PYS - PaySauce

[etrader]

15 trading days until the annual results are out and one would guess this potentially will sync with the update on embedded payrole with a “multi jurisdiction employment software firm” jury is out on who, how big and what the downstream benefits will be if this gets rolled out globally.

My novice view reading between the lines are.
* PYS processes the payroll on behalf of an existing employment software firm clipping a min employee annual fee upfront on a multi year contract.
* PYS hold the funds to gain interest
* the payroll labour needs won’t increase as this software firm is still responsible to those employees meaning little difference in headcount once 2.0 is developed
* immediate boost to annual ARR, cashflow to expand Oz
* This version 2.0 was been developed already to roll out Oz so it’s pushed it along for more positive results.
* Non of this will require capital raising and in fact I would say the upfront fee will give free flow of cash to roll out Oz and beyond.

Who could it be is anyone’s guess but globally there’s a lot of consolidation in payroll and firms are seeing multi jurisdictions software where digital nomads can work anywhere and get paid in that currency 💵

I’m picking post result a new range of .25, - 32c while this news and the upside flow through each quarter.

[etrader]

Tomorrow pre market the results are out !!!

We know q1 / q4 sales already and know the “proof of concept” has been accepted with the final contract and terms to be released.

The key metrics I’m looking at before scaling up my holding is….
• who is the contract with that the embedded software has been trialed on / how many employees will come under the new contract and what min revenue and terms of contract are in place.

• will this be exclusive to one employment software firm for a period of one year ? Or does it allow them to push further around jurisdictions?

• they’ve already announced their first “profit and cashflow positive” expectations albeit how much ? Given the growth % is small I’m picking 50k - 150k max pre tax profit.

Let’s digest the metrics and see if this pops .30c in the come 30 days.

[Sideshow Bob]

https://www.nzx.com/announcements/431425

Software as a Service Fintech PaySauce (NZX: PYS) today reports a maiden full year net profit after tax of $1.2m for the year to 31 March 2024 as the company benefited from growth in customers and increased interest income.

It also reports significant progress in preparing for its next phase of growth. PaySauce is nearing completion of the proof of concept which will demonstrate the ability to execute wholesale payroll with the new Gen 2.0 payroll engine. PaySauce also extended the reach of its microbusiness app from its core dairy farmer market into new verticals of plumbers, builders and hospitality.

HIGHLIGHTS
- Operating revenue: $7.7m up 33% lifted by a 7% increase in customers to 7,368 and a 11% increase in average monthly revenue per user (ARPU) to $91.
- Processing fee income: $5.4m up 17% lifted by customer growth and fee increases as we passed on rising costs.
- Interest income: $2.2m up 96% lifted by customer growth and continued high interest rates.- Annualised recurring revenue (ARR): $8m up 19% from $6.7m.
- EBTDA: $1.06m, reverses EBTDA loss of $0.08m with revenue growth more than offsetting investments for growth and general inflationary pressures.
- Net profit after tax (NPAT): $1.2m maiden net profit, reversing a $0.6m loss.

[Sideshow Bob]

https://www.nzx.com/announcements/433857

KEY YEAR-ON-YEAR PERFORMANCE HIGHLIGHTS FOR Q1 FY25

- Executed the Proof of Concept (POC) for wholesale payroll using our new Gen 2.0 engine
- ARR of $8.2m (Up 18% YoY)
- Recurring revenue of $2.1m for the quarter (Up 20% YoY)
- Processing fee revenue of $1.5m for the quarter (Up 18% YoY)
- Customers at end of the quarter - 7,611 (Up 7% YoY)

[Almost-confused]

Nice 10% move today. A fairly thin order book so was always going to move up quickly once someone decided they wanted in. $$

[winner69]

Nice 10% move today. A fairly thin order book so was always going to move up quickly once someone decided they wanted in. $$

Couple of PE guys hanging out around town ...... maybe sounding put PaySauce

Might check with Mike if anything up

[etrader]

Some time back the proof of concept was finished for third party client and the gap to contract is dragging, the revenue is generally flat and they need to lift their overall sales to keep interest in this stock.

Yes agree small increases on light volume, looks like mum and dad investors

Couple of PE guys hanging out around town ...... maybe sounding put PaySauce

Might check with Mike if anything up