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

Yes, retest of highs before too long...

Yesterday's minimal move higher reported in The Times and Telegraph as possible merger with World Pay. Bored traders perhaps.

Daily Telegraph:

Finally, mobile payments company Optimal Payments became the latest target of takeover chatter in the City. The stock ticked up 1.8pc to 340.5p as traders said Worldpay was a possible suitor

I'd prefer to see value added from Skrill and good growth before a takeover approach but can see how the enlarged group with US Skrill and the existing business is likely to be appealing to a suitor.

http://www.forbes.com/sites/thomasbrewster/2015/11/05/optimal-payments-hack-investigation/

The history behind the original hacking attempts.

Canaccord comment on the above article:
"The article describes how the author came across the data, his dealings with his source and his interactions with Optimal Payments. He comments on the sensitivity, amount and age of the data, how such data can potentially be used on the “dark web” and the risks to enterprises generally. The article provides many positive disclosures for Optimal Payments:
• The article indicates that data is related to attacks from 2009 and 2010. Optimal Payments previously stated that forensic audits indicated that the NETELLER data breach contained no evidence to suggest that the breach was material and, to the best of the company’s knowledge, no NETELLER customers suffered any financial losses as a result. Similarly, to the best of the company’s knowledge, no Moneybookers’ customers suffered any financial losses as a result of the historic breach.
• The article did not contradict Optimal’s account that the Neteller breach involved only a marketing database with no financial information. Optimal indicates in the article that the Moneybookers breach involved a production database with encrypted passwords and card numbers, but that the forensic investigator believed the likelihood of a successful transfer of the data to the attacker was low.
• The author was impressed with Optimal Payments’ professionalism and openness. He said the company was “refreshingly transparent”, “responded quickly” and praised its “exemplary reception of ethical disclosure”. Optimal Payments reported the breaches in 2009 & 2010 to the FSA (now the FCA) and were the subject of independent forensic investigations from major accounting firms.
The article alleges that the leaked databases contained 4.5m and 3.6m records from Moneybookers (Skrill) and Neteller, respectively. Optimal has commenced an investigation into the matter and the veracity of the allegations (bought to the company by the journalist at Forbes), and has informed both the Information Commissioner and the FCA. Shares continue to trade at a discount to peer average (11.7x versus 13.5x FY2 EV/ EBITDA), despite strong growth and potential for earnings out performance, driven by acquisition cost synergies, combined Skrill/ Neteller margin improvement and continued strong growth against conservative market expectations."

Thanks Harrycat.

Looks like there are no significant shorts on this now either ..

So we're now under the PAYS ticker and trading in line with expectations. Synergies of $5-$10m by end of this year. Plus integration ahead of schedule. Canaccord (today) buy, tp 425p

What a lot of full mouth creating over here
pardon me is only my view

try that in english pim!

Berenberg views payment services industry as a structurally growing industry, it says in note as it initiates European payment coverage.

- sector's transaction volume growth drive by GDP growth and non-cash based transactions gaining share vs. cash.
- M&A activity is rife as new money from venture capital funds is attracted by growth

Paysafe Group preferred stock in industry and sees its discount vs sector is unjustified. New buy, tp 431p

There is a new thread now under the PAYS ticker.