Ann: HALFYR: SPY: SmartPay Interim Result

• Release Date: 29/11/12 15:42
• Summary: HALFYR: SPY: SmartPay Interim Result
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SPY
29/11/2012 13:42
HALFYR

REL: 1342 HRS Smartpay Holdings Limited

HALFYR: SPY: SmartPay Interim Result

SMARTPAY INTERIM RESULT

o Interim result a mix of old and new structure as restructure occurred mid
period
o Business on track and performing well following restructure

AUCKLAND, 29 November 2012 - SmartPay (NZX: SPY), a leading provider of
payments and transactional solutions in New Zealand and Australia, today
announced its interim, unaudited financial results for the six months to 30
September 2012.

Six month financial highlights:
o Revenue $7.155 million,
o Gross Profit $6.245 million,
o Earnings before interest, tax, depreciation and amortisation (EBITDA),
$1.916 million,

Managing Director, Bradley Gerdis, said "This interim result reflects a mix
of the old and new structure as the restructure of the business occurred mid
period between July and August.  This interim result is therefore not
reflective of the current business as it only includes a part period of cash
flows from the bringing the rental revenue back in house".

As the month of October is the most representative month of the business
under the new model post the restructure and provides the best indication of
the how the business is currently performing, the Board is pleased to confirm
that the business is now performing in-line with expectations.

We said at the time of the restructure that "...once the recapitalisation is
complete and rental revenues are brought back into the business, the Board
expects the business to generate revenue in the order of $17.5m and EBITDA of
$7.5m on an annualised basis." (Source: SPY 2012 full year results
announcement, 30/05/12) .  We are pleased to confirm that for the month of
October, being the first full month under the new structure, that the
business is generating revenue of approximately $17.0m and EBITDA of $7.4m
(unaudited management accounts) on an annualised basis.

The slightly lower revenue number relates to one small group of contracts
that we have not yet brought back in-house.  While we continue to negotiate
with the party holding those contracts with the intention to eventually bring
them back in-house, the rest of the business is performing ahead of
expectations resulting in overall profitability in-line with expectations so
we are pleased with the overall position of the business.  Of course our net
debt is lower as a result of not having bought back these contracts and with
the benefit of the positive monthly cash flows generated by the business.

Business Update and Outlook

New Zealand

Our New Zealand business is performing well and we have a number of new
products and services due for release over the next few months.  We will be
introducing a completely new hardware range of next-generation payments
solutions including mobile Apple IOS and Android based integrated payments
terminals.  We also have a number of new business streams expected to deliver
incremental revenue opportunities in the new year.

Australia

We have started to resource our Australian sales team and have recently
appointed an experienced General Sales Manager to lead the growth of our
Australian sales channels.

We have had significant interest in our next-generation payments solutions
from both our banking channels and direct from retailers.  With both the
products and sales capability in place we expect to see strong growth from
Australia in the new year.

ENDS

For further information contact:

Bradley Gerdis, Managing Director, SmartPay, + 64 9 442 2717

About SmartPay Holdings Limited
SmartPay is a leading provider of integrated merchant services utilising the
Internet and broadband connectivity.

SmartPay's product set includes:
1. The provision of EFTPOS terminals and related payments services.
2. Transactional processing services, including for the taxi industry;
Prepayment products; Bill payment solutions and Online Payments.
3. Audio and video, music, messaging and media via its Retail Radio product
set.

For more information visit - www.smartpayltd.com
End CA:00230419 For:SPY    Type:HALFYR     Time:2012-11-29 13:42:25