Record-high net profit of HK$ 625 million.
(Hong Kong, PRC, 30 March 2020) PAX Global Technology Limited (“PAX” or the “Company” or the “Group”, HKSE stock code: 00327.HK), one of the world’s leading providers of electronic payment terminal (“E-payment terminal”) solutions and related services, is pleased to announce the annual results for the year ended 31 December 2019.
In 2019, the Group’s revenue and net profit achieved new record highs. Revenue increased by 11.6% to HK$ 4,925.7 million. Profit for the year was HK$ 624.9 million, representing a surge of 21.2% compared to 2018. Profit attributable to the owners of the Company was HK$ 623.9 million, an increase of 19.4% year-on-year. The basic earnings per share was HK$ 56.7 cents (2018: HK$ 47.5cents). The Board of Directors of the Company has recommended to declare a final dividend of HK$ 0.06 per ordinary share, representing an increase of 50% compared to HK$ 0.04 per ordinary share in 2018.
As one of the world’s leading E-payment terminal solution providers, overseas markets represent the core of the PAX’s business, accounting for around 91.9% of total revenue, as compared to 84.5% in 2018. In 2019, PAX strengthened its global strategic investment and recorded a significant revenue growth of 21.3% in overseas markets.
Driven by the widespread adoption of cashless payment methods worldwide, financial inclusion has become a key national development strategy for governments worldwide. The introduction of more convenient and efficient electronic payment options continues to offer unprecedented innovative opportunities for the E-payment terminal industry. A regional summary of PAX business in 2019 follows:
Latin America and the Commonwealth of Independent States (LACIS)
In the LACIS region, PAX maintained its market-leading position. In view of promising business prospects of acquirers in Brazil, PAX established further strategic partnerships with acquirers and enhanced the local Android product portfolio.
PAX’s strong brand recognition in Brazil also continues to generate positive knock-on effects in other key countries, such as Mexico and Argentina, where PAX continues to capture market share.
Europe, Middle East and Africa (EMEA)
Throughout the EMEA region, PAX’s Android smart terminals (SmartPOS), intelligent management and integrated payment terminals (SmartECR) solutions continue to be in high demand, where an increasing number of acquiring banks and payment service providers appreciate the enhanced value that can now be offered to their merchants, by leveraging the innovative PAXSTORE service platform.
In Europe, PAX has also added strength to its existing extensive spectrum of international software and hardware certifications, by obtaining ITSO certification from the Integrated Transport Smartcard Organization in the United Kingdom, and ATEX certification from the European Union for safe device usage on petroleum forecourts.
In the Middle East, there was strong demand for PAX’s new Android-based solutions in the GCC (Gulf Cooperation Council countries) and North Africa, where significant large-volume sales occurred. Large volume orders also continued to come in from West Africa, where government initiatives continue to encourage financial inclusion and a drive towards more cashless economies.
Asia Pacific (APAC)
Asia Pacific is proving to be one of the most dynamic parts of the world when it comes to electronic payments, with practically all countries are now devoted to promoting cashless payment societies.
The Group established subsidiaries in India and Japan in recent years and now successfully penetrating these markets. PAX’s Android terminals have been highly recognized in India, Indonesia, Malaysia and many other countries. The Group not only covers the mainstream acquiring banks and institutions in various APAC countries, but has also been selected as one of the main Android product suppliers by many regional acquiring institutions, electronic wallet companies and value-added service companies.
In 2019, PAX’s sales in India achieved a high growth momentum, with annual shipments exceeding 600,000 units, positioning the Group as the leading supplier in India.
United States of America and Canada (USCA)
In the United States, the PAX’s brand image has been further enhanced as the Group took the lead in bringing its Android SmartPOS and SmartECR portfolios to market.
Major processors and acquirers have now certified PAX products, with more chain store brands, Independent Sales Organizations (“ISOs”) and merchants entering into strategic partnerships with the Group.
EMV migration in the USA’s petroleum forecourt sector is expected to accelerate in 2020, especially for self-service terminals and the Group believes that this will help stimulate further market demand for PAX solutions.
Important certifications were achieved from Verizon and AT&T, the two nationwide telecommunications companies in the United States, which help set the scene for further growth momentum in the USCA region.
In 2019, revenue generated from China decreased by 41.9% to HK$397.1 million. The decrease was mainly due to the continuously keen price competition and shifting of the Group’s overall strategy to focus more on serving strong and reputable customers. PAX will continue to strengthen its strategic partnerships with leading acquiring banks and payment service providers in China, as well as, strengthen the risk assessment and management procedures of the China business. PAX believes that it will improve the Group’s overall profitability to bring benefits to shareholders in the long run.
Mr. Jack Lu, Chief Executive Officer of PAX, commented:
PAX is at the forefront of the electronic payment value chain and is committed to continuously enhancing the Group’s innovative product portfolio through R&D and continuous innovation. Our new generation of Android SmartPOS, SmartECR and smart self-service products (SmartKiosk) offer revolutionary solutions to customers worldwide. Looking ahead, the prospect for the E-payment terminal market is more promising than ever before. Thanks to our skilled personnel resources, diversified solutions portfolio and extensive global sales network, PAX is more than well prepared to embrace the huge market opportunities being presented as cashless societies become prevalent around the world, allowing the Group to achieve more remarkable milestones and create greater value for customers and shareholders alike.