SUPERB RESULTS

REG - Optimal Payments PLC - Interim Results19 Sep 2012 - 07:01

For best results when printing this announcement, please click on the link below: http://pdf.reuters.com/Regnews/regnews.asp?i=43059c3bf0e37541&u=urn:newsml:reuters.com:20120919:nRSS5828Ma RNS Number : 5828M Optimal Payments PLC 19 September 2012 Optimal Payments Plc Interim Results for the six months ended 30 June 2012 Strong first half growth, on track to exceed full year market expectations Optimal Payments Plc (LSE: OPAY) ("Optimal Payments", the "Group" or the "Company"), a leading online payments provider, today announces its results for the six months ended 30 June 2012. Highlights · EBITDA(1) up 76% to $11.2m (H1 2011: $6.4m). · Revenues up 37% to $78.9m (H1 2011: $57.4m). Fixed costs marginally down following headcount reduction in Q1. · Profit before tax $1.7m (H1 2011: loss of $4.1m). · Strong organic growth from NETBANX Straight Through Processing division ("STP"), up 68% to $61.9m (H1 2011: $36.9m) with continued strength and growth in Asia. · NETELLER Stored Value ("SV") revenues down to $16.2m (2011:$18.0m(2)) principally as a result of the fallout from Black Friday(3) in H1 2011. § Initiatives undertaken in H1 have produced improved results in second half to date. Major investment in NETELLER SV platform now complete and cost base aligned. § US online gaming opportunity taking shape. · Strong demand from existing customers and from new customers won during the first half including Ford Credit, Hockey Canada and Rona. Commercial agreement signed with Lotus F1 Team. · Strong H1 revenue exit run rate positions the Company for further growth in second half and on track to exceed the market consensus full year expectations. Financial summary (unaudited) Six months ended 30 June 2012 2011(5) US$ million US$ million Revenue Straight Through Processing (NETBANX bureau & gateway services) 61.9 36.9 Stored Value (NETELLER eWallet & Net+ cards) 16.2 18.0 Stored Value - discontinued revenues (4) - 2.1 Investment income 0.7 0.4 Total Revenue 78.9 57.4 EBITDA (1) 11.2 6.4 Profit/(loss) before tax 1.7 (4.1) Tax (charge)/recovery (6) (2012 charge relates to 2004/5 period) (2.5) 0.5 Net loss for the period (0.8) (3.6) (1) EBITDA is defined as results of operating activities before depreciation and amortisation and exceptional non-recurring items which are defined as items of income and expense of such size, nature or incidence, that in the view of management their disclosure is relevant to explain the performance of the Group. (2) Excluding discontinued revenues - see note 4. (3) "Black Friday" refers to the regulatory action taken in April 2011 against certain major poker operators which resulted in many players ceasing to play poker worldwide. (4) Discontinued revenues were derived from e-money expiry which is now subject to different rules under the Electronic Money Regulations 2011. (5) 2011 comparables include only 5 months of revenues and costs from the OP Inc business acquired on 1 February 2011. (6) Tax charge in the period relates to expected reassessment of 2004/5 Canadian taxes following a review by the Canadian Revenue Agency which commenced in 2005. The Board has made a full provision for the amount it believes it is likely to be required to pay in respect of withholding taxes and interest. See note 17 in the Financial Statements for more detail. Commenting on today's results announcement, Joel Leonoff, President & CEO, said: The combination of NETELLER and OP Inc. has produced a multi-faceted payment product offering and positioned the emerged business Optimal Payments Plc to benefit from a rapidly evolving online payment market. Our efforts have resulted in a fully integrated and right-sized business with an efficient cost base. Our operationally geared business model, continued focus on product development and R&D, along with our strong presence in the internet payment market have combined to produce significant organic revenue and EBITDA growth. Our H1 results and strong foundation position the Company well for further growth in H2. The online payment industry continues to consolidate and the Group should benefit from the expected significant growth in both the online and mobile commerce markets. We see substantial opportunities to provide innovative solutions to merchants and consumers in both the NETELLER eWallet and NETBANX

Questor share tip: Optimal Payments shares jump on profits

Aim-listed online payment processor sees shares jump almost 8pc as revenue and profits rise, says Questor


Optimal Payments
510p+36¾p
Questor says BUY


SHARES in Aim-listed online payment platform Optimal Payments jumped by almost 8pc as it reported soaring first-half profits and major acquisitions yesterday.


Optimal Payments helps customers use credit cards, debit cards and direct debits online by processing them through a technology system designed and managed by the company.


The company has two main sources of revenue: NETELLER, an “e-wallet” business into which online gamblers can deposit money before playing games, and NETBANX, a system that processes transactions for online retailers. Both performed strongly, lifting group revenue by 34pc to $159m (£98.7m) during the six months ended June 30.


NETELLER is the faster growing of the two, with revenue increasing by 46pc to $41.4m during the first six months, while gross margins improved to 87pc, from 83pc. The NETBANX business is no slouch either, increasing revenue by 31pc to $117.4m, on gross margins stable up to 55pc.

With revenue increasing strongly and margins improving, pre-tax profits jumped to $27.5m, for the half-year ended June, from $15.5m a year earlier. Group net cash increased by $27.8m to $121.6m.

Revenue and profit growth should accelerate next year following the $225m spent on acquisitions in July.

There are opportunities for further growth, too. Gaming legislation in the US is easing and the next big opportunity is if California, the biggest state in the US, legalises online gambling.

This investment is not without its risks. In 2006, the US withdrew online gaming licences, causing Optimal’s shares to suffer a crash. Also, about a third of the group’s fee revenue comes from just one client.

Optimal is expected to achieve pre-tax profits of $58.8m, on revenue of $318m in the year ended December. With 19.5p in earnings per shares forecast, the shares are trading on 25 times, falling to 20 times next year.

Questor said the shares were one to watch at 250p this time last year and we said buy at 425.5p in July. The shares are up 18pc in just over a month and we still like the outlook. Buy.

Biggy here from one of the better brokers...

11 Sep 2014 Optimal Pay OPAY Barclays Capital Overweight 521.75 510.00 600.00 600.00 Reiterates

SP TARGET 600p

Bring it on gf.

Warn out now............LOL.

Another good day here - worn out as well gf.

Well done 3m and all. :-))

Thank you dc - hope you have some that are doing well. I only have this one that is any good but better than nothing at all.

New research report out from Edison:

Http://www.edisoninvestmentresearch.com/research/report/optimal-payments15

News just hitting the wires of agreement renewal and enhancement to the Desjardins internet payment solution. Several solution enhancements successfully implemented.

Momentum for 600p...

What is happening here - another day of red?

Just the market in general 3m.

Been like this for 3 or 4 days.

Canaccord reiterates buy yesterday tp 600p. News just out too of a tie in with Demandware. Should see some pm improvement.

Excelent.

Correct just looked at press releases on Corporate Governance it came out yesterday.

Did not think we would see this below £5 but it has managed it.

It jumps back up pretty quickly 3m.

Modern day markets for you were computers are directing this and that data.

It is falling pretty dam fast gf - it needs to go in reverse equally as fast.

You cant hold this one back either way thats for sure 3m.

Pathetic somewhat!!! gf Ah well more patience required.