Payment services company Safecharge’s (SCH) strategy in recent years has been to build out its portfolio of high-quality 'tier one' customers – larger clients for whom it provides tailored services. Progress has been mixed. The group launched services for companies including 888 (888) and Plus500 (PLUS) in the period, but in the trading statement preceding these numbers, management warned revenue from these clients was coming through slower than expected.
Reshaping the customer base in this way meant first-half gross profit fell 4 per cent year on year to $30.4m (£22.9m). But a number of significant clients including Bet365, Paddy Power and EuroBet will be launched from the second half of 2017 and into early 2018.
Transaction volume has continued to grow, climbing 30 per cent to 75.6m in the period, with the total value of said transactions up 7 per cent to $4.2bn. This was due to growth in new and existing clients, alongside rapid growth in volumes from Safecharge Acquiring, the company’s dedicated platform. Transaction value from the platform more than doubled to $811m, from $395m last year, and by period-end was accounting for a fifth of overall transactions.
Analysts at Shore Capital are forecasting adjusted pre tax profit of $30.2m, giving EPS of 18¢ in 2017 (from $29.6m and 18.3¢ in 2016).
| SAFECHARGE (SCH) | ||||
| ORD PRICE: | 248p | MARKET VALUE: | £363m | |
| TOUCH: | 245-250p | 12-MONTH HIGH: | 288p | LOW: 197p |
| DIVIDEND YIELD: | 5.2% | PE RATIO: | 21 | |
| NET ASSET VALUE: | 106¢* | NET CASH: | $113m | |
| Half-year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
| 2016 | 52.2 | 16.0 | 10.0 | 7.00 |
| 2017 | 53.0 | 13.5 | 8.2 | 7.69 |
| % change | +2 | -15 | -18 | +10 |
| Ex-div: | 28 Sep | |||
| Payment: | 13 Oct | |||
| *Includes intangible assets of $37.2m, or 25¢ a share £1=$1.33 | ||||
