- Operational gearing is a plus in a positive sales cycle.
- High gross margin.
- Improving cash generation.
Targeting high net worth individuals (HNWI) and small and medium-sized enterprises (SMEs), one exciting fintech company in the payment processing sector is taking on the incumbent banks and delivering eye-catching growth in transaction volumes. With a high-end offering in international payments solutions and a low-cost operating model (with the benefit of a relatively fixed cost base), an increasing proportion of incremental revenue will be converted into profit.
The business' operational gearing is not only expected to deliver robust profit growth over the 2024-26 forecast period, but the low working capital intensity and high cash conversion will materially strengthen the group’s financial position. Underpinned by prospective FCF yields of 4.8 per cent (2024), 10.8 per cent (2025) and 13.3 per cent (2026), net cash could increase 13-fold by the 2024 year-end and double in each of the two years thereafter.
