Ann: 2022 Interim Report, page-53

UBS post-results update
Negatives in rear mirror, focus on the positives

In our view, the market has focused on the negatives, rather than considering thepositives from the result. We suspected Omicron would impact gift cards, we knew theCBI remediation would reduce establishment fees and increase costs. The positivesdeserve attention, in our view: 1) GPR rev growth +28% (despite no new clients in GPREurope); 2) CBI remediation in sight, but importantly EML has recommenced onboardingnew clients from Dec22; 3) Interest headwinds (-$2.7m cost) in 1H22 become tailwindsgoing forward, with a +1% in cash rate adding +$14-15m EBITDA (full benefit worth+24-26% to FY23E EPS) from EML's $2.7b float; 4) The material uplift in the salespipeline ($13.6b vs $10.5b at 4Q21), with 439 active deals vs 313 at FY21 and a numberof large potential deal decisions expected shortly (within 6 weeks); and 5) The missedrecovery of the Xmas gift card tailwind provides further incremental upside in FY23E.EML is trading on a 2yr fwd EV/EBITDA of 10.0x vs the international high growth peermedian of 13.1x, despite offering a stronger 2yr EBITDA CAGR (+27% vs +24%).Maintain Buy.