PaySauce (NZX: PYS) reports rise in Q2 YoY recurring revenue

Highlights

• PaySauce announced its Q2 FY23 update today (11 October 2022).
• The company reports a recurring revenue of NZ$1.3 million, up 74% YoY.
• PYS claims that it has become a market leader in the dairy industry.

Employment fintech PaySauce Limited (NZX: PYS) announced its Q2 FY23 update today (11 October 2022). The company, which gives employers the technology to digitally onboard, pay and manage employees from any device, reported a recurring revenue of NZ$1.3 million, up 74% year on year (YoY), and annualised recurring revenue (ARR) crossing NZ$5.5 million in the second quarter of 2023.    

As per the company, it continued to grow in the quarter to September 2022. Asantha Wijeyeratne, CEO of PaySauce, said that the results were in line with expectations and that continuing interest rate hikes had become a contributor to the overall recurring revenue.

In its update, the company also confirmed that it had become a market leader in the dairy industry with almost half of all its employing dairy farms using the PaySauce platform to pay their staff members. The CEO also said that the milestone was achieved in the quarter to September 22, which is earlier than anticipated.

Further, he specified that the success in the dairy sector was being applied to other small and medium-sized enterprises, including hospitality and construction.

Q1 FY23 results

For the first quarter of FY23 (7 July 2022), the company saw recurring revenue go up 86% YoY and ARR move up to NZ$4.9 million, up 69% YoY. Jaime Monaghan, CFO, said that the results in the first quarter were driven by three key factors: customer growth, average processing fees, and interest income earned on the float.

As per the company, sales in the first quarter to June were mainly due to customer growth in the dairy sector. Recurring revenue increased mainly from processing fee revenue.

Key highlights

• Recurring revenue of NZ$1.17 million (86% increase YoY)
• Processing fees (PaySauce and SmoothPay) of NZ$1.03 million (72% increase YoY)
• ARR of NZ$4.94 million (69% increase YOY)
• Active customers at the end of the period were 6,514 (24% increase YoY)

Even in Q1, as per the update, growth from interest revenue also increased as the floating rate increased.

Stock performance

On 11 October, the stock was trading down 6.35% to NZ$0.295, at the time of writing.