Stargroup boosts revenue by 50%
Payments player Stargroup (ASX:STL) has recorded its eight quarter of record revenue in a row, and says all the signs are pointing towards a ninth.
STL told its shareholders this morning in a pre-open release that it had quarterly revenue of about $750,000, which was a 24% jump on gross revenue quarter-on-quarter, and more than double on a year-on-year basis.
The result was driven by a 50% hike in ATM revenue for the quarter on the back of a 51% increase in ATM transactions.
STL said ATM revenue reached almost $350,000 for the quarter, but there would be more to come in the next quarter.
In October last year STL announced that it would acquire Cash+ and its network of 109 ATM machines.
The latest quarterly result, STL said, only contained one month of contribution from the new 109 machines.
STL currently has 230 active ATM machines in the field.
“This quarterly result has only incorporated on month’s results of the recently acquired ATMs from Cash Plus and therefore we will also see a significant improvement in our results in the next quarter,” STL CEO Todd Zani said.
Average transactions per machine reached 667 per month during the quarter, a 9% increase quarter on quarter.
STL said it was focused primarily on the transactions per machine metric as an indicator of growth as it’s “the best as to how well we are investing our shareholders’ capital”.
It said its result of 667 transactions per month put more established players in the space in the shade, including Canadian-listed DC Payments, over which STL enjoyed a 20% premium.
Back in September STL merged with iCash Payment Systems to create a combined ATM and EFTPOS company.
It has a network of ATMs around Australia, taking a clip on each transaction, but it also has longer term plans to get into the EFTPOS game, adding another source of revenue for the combined company.
STL is also the only listed ATM company which has a direct stake in the manufacturer of its ATM machines, namely NeoICP in South Korea.
It has estimated the stake helps reduce the costs of manufacturing machines by about 30%, saving $1.1 million in capital expenditure each year.
It has also sought to diversify into other areas such as ‘cash recycler’ ATMs and PayWave Technology.
Where to invest $1,000 right now
When the experts at Next Investors have a stock pick, it may pay to listen.
The Next Investors have been investing in ASX small cap stocks for years, with their best small cap picks yielding returns of 1,200%, 1,120%, 900% and 678%.
They have just revealed their hand-picked, FY2021 stock portfolio of high conviction long-term investments.
Click the link below to see what they are currently investing in.
S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.
Conflict of Interest Notice
S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.
The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.