Technology investments, international expansion and booming e-commerce and online gambling markets did the trick for Safecharge (SCH) in its first full year as a publicly-traded entity. Soaring transaction volumes drove the payment processing group's adjusted cash profits up 26 per cent to $31.1m (£21.7m) in 2015.
Safecharge offers merchants such as Paddy Power Betfair (PPB) a reliable payments platform, security and fraud detection services, together with innovative cashier technology that allows the real-time payment of winnings and refunds. It signed a flurry of new customers and landed more work from existing clients in the period. That drove the value of transactions it processed up 21 per cent to about $6.9bn, sending organic revenues up a fifth in the core business.
Management rolled out new services and ventured into new markets and territories. For instance, it launched acquiring services for Visa - it already processes payments for MasterCard. Snapping up peer CreditGuard helped it win its first retail, travel and aviation customers. And it will soon launch its inaugural point-of-sale product, allowing it to offer merchants both online and offline payment solutions.
Broker Numis expects pre-tax profits of $35.8m in 2016, giving EPS of 20.9¢ (from $28.5m and 17.3¢ in FY2015).
| SAFECHARGE (SCH) | ||||
|---|---|---|---|---|
| ORD PRICE: | 262p | MARKET VALUE: | £396m | |
| TOUCH: | 258-265p | 12-MONTH HIGH: | 296p | LOW: 235p |
| DIVIDEND YIELD: | 3.0% | PE RATIO: | 25 | |
| NET ASSET VALUE: | 110¢ | NET CASH: | $133m* | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2011 | 30.3 | 5.9 | 3.6 | na |
| 2012 | 32.9 | 4.1 | 2.4 | na |
| 2013 | 43.2 | 0.4 | -1.3 | nil |
| 2014† | 76.9 | 16.3 | 10.4 | 8.16 |
| 2015 | 99.8 | 22.7 | 15.1 | 11.3 |
| % change | +30 | +39 | +45 | +38 |
Ex-div: 19 May Payment: 27 May *Excludes $18.6m in available-for-sale investments †Safecharge listed in April 2014 £1=$1.42 | ||||
