The EML Payments (ASX: EML) share price is up more than 13% after announcing a trading update.
What is EML Payments?
EML specialises in issuing and managing prepaid stored value products, ranging from reloadable cards through to traditional, single-store gift cards. The company was founded in 2001 and its head office is in Brisbane, Australia.
EML Payment’s trading update
EML has continued its upwards trajectory after the last update.
In March the gift and incentive (G&I) segment saw gross debit volume fall 29% reflecting mall closures. The general purpose reloadable (GPR) segment saw GDV growth of 10.4% which is expected to continue in the fourth quarter with salary packaging programs launching additional benefit accounts. The Virtual Account Numbers (VANS) segment was up 56%.
In April the G&I segment saw GDV of $31.4 million, down 53%. Excluding the PFS acqusition, EML’s GPR segment grew GDV by 26% to $286.5 million thanks to salary packaging and resilient online gaming. PFS contributed $395.3 million of GDV – PFS volumes were in line with pre-COVID-19 levels and up 13% compared to April 2019. EML’s VANS segment saw $612.5 million in the month, up 9%. Unaudited EBITDA for the month including PFS was $2.7 million.
The company is expecting that COVID-19 will cause an acceleration of the take up of digital payments.
Is EML a buy?
EML continues to rise and it’s focused on the long term. It could be one to think about for the continuing shift back to normal life, but I’m not sure how much further the company can recover. It may be an idea to consider other technology shares on the ASX.
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Disclosure: at the time of publishing, Jaz does not have a financial interest in any of the companies mentioned.