Last close As at 05/08/2026
GBP1.08
▲ 4.00 (3.86%)
Market capitalisation
GBP309m
Research: TMT
Boku saw strong growth in total payment volume (TPV) in H123 translating to revenue growth of at least 24% (31% constant currency) and EBITDA growth of at least 25%. Local payment methods (LPMs) were a key driver of growth, pushing up the take rate to 0.76% and contributing 19% of revenue. The company also announced that CEO Jon Prideaux will be stepping down from his role at the end of the year; his successor will be Stuart Neal, who was previously CFO of Boku, providing continuity and decades of experience in the payments industry.
Boku |
Strong H1 drives upgrades |
H123 trading update |
Software and comp services |
4 July 2023 |
Share price performance
Business description
Next events
Analyst
Boku is a research client of Edison Investment Research Limited |
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Boku saw strong growth in total payment volume (TPV) in H123 translating to revenue growth of at least 24% (31% constant currency) and EBITDA growth of at least 25%. Local payment methods (LPMs) were a key driver of growth, pushing up the take rate to 0.76% and contributing 19% of revenue. The company also announced that CEO Jon Prideaux will be stepping down from his role at the end of the year; his successor will be Stuart Neal, who was previously CFO of Boku, providing continuity and decades of experience in the payments industry.
Year |
Revenue |
EBITDA* |
Diluted EPS* |
DPS |
P/E |
EV/EBITDA |
12/21 |
62.1 |
22.9 |
4.7 |
0.0 |
36.2 |
17.8 |
12/22 |
63.8 |
20.5 |
4.0 |
0.0 |
43.0 |
19.9 |
12/23e |
76.8 |
24.9 |
4.9 |
0.0 |
35.1 |
16.4 |
12/24e |
86.9 |
29.0 |
5.8 |
0.0 |
29.3 |
14.1 |
Note: *EBITDA and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
FY23 trading ahead of expectations
The company saw strong trading in H123 and anticipates beating the board’s prior expectations for FY23. Boku expects to report H123 TPV of $5.0bn (+15% y-o-y), revenue of at least $37.5m (+24% y-o-y, +31% in constant currency) and EBITDA of least $12.0m (32% margin). LPMs were a key driver of growth, contributing revenue of $7.2m (19% of total revenue; up 359% y-o-y). With LPM monthly active users at 8% of the group total of 61.2m, this demonstrates how LPMs support higher transaction values. End-H123 cash was $114m, of which c $52m was Boku’s own cash, with an average daily cash balance of $106m in June. To reflect the stronger than expected performance we upgrade FY23/24/25 revenue by 6.4%/ 5.8%/5.4% and EBITDA by 7.7%/7.1%/5.9%.
CEO transition announced
The current CEO, Jon Prideaux, intends to retire from the role on 31 December 2023 and will remain as a non-executive director thereafter. After a search for a new CEO, Stuart Neal has re-joined Boku and been appointed CEO designate; he will work with Jon for the rest of the year. He is expected to join the board and be appointed CEO on 1 January 2024. Stuart held the role of Boku CFO in 2012-2014 and 2017–2019 before heading up the Identity division before its sale to Twilio.
Valuation: LPMs to drive upside
Boku is trading at a discount to its peer group on EV/EBITDA multiples for FY23. Via a reverse discounted cashflow (DCF) that uses our forecasts to FY25 (which are more conservative than the company’s mid-term targets would suggest), we estimate the share price is factoring in revenue growth of 6% and average EBITDA margins of 36% for FY26–32, well below the company’s targets. In a DCF factoring in meeting the targets by FY27, we estimate the shares could be worth 214p. A growing contribution from Amazon, continued adoption of LPMs and new major merchant sign-ups are the main triggers to achieve this, in our view.
H123 trading update
The table below summarises the company’s performance in H123.
Exhibit 1: H123 key performance indicators
H123 |
H122 |
Growth y-o-y |
|
TPV |
$5.0bn |
$4.3bn |
15% |
Revenue |
At least $37.5m |
$30.3m |
24% |
Take rate |
0.76% |
0.70% |
|
EBITDA |
c $12m |
$9.5m |
25% |
Monthly active users (MAU) |
61.2m |
46.4m |
32% |
New users |
32.7m |
29.3m |
12% |
Local Payment Methods (LPM): |
|||
MAUs |
4.7m |
2.1m |
122% |
New users |
6.3m |
3.2m |
97% |
LPM MAU/Total MAU |
7.7% |
4.5% |
|
LPM new users/total new users |
19.3% |
10.9% |
|
Revenue from LPMs ($m) |
7.2 |
1.6 |
359% |
Revenue from direct carrier billing ($m) |
30.3 |
28.7 |
6% |
LPM revenue/group revenue |
19.2% |
5.3% |
Source: Boku
Changes to estimates
We have revised our forecasts to reflect H1 performance.
Exhibit 2: Changes to estimates
$'m |
FY23e |
FY23e |
FY24e |
FY24e |
FY25e |
FY25e |
|||||||
Old |
New |
Change |
y-o-y |
Old |
New |
Change |
y-o-y |
Old |
New |
Change |
y-o-y |
||
Revenue |
72.1 |
76.8 |
6.4% |
20.4% |
82.1 |
86.9 |
5.8% |
13.2% |
92.1 |
97.0 |
5.4% |
11.7% |
|
Gross profit |
69.6 |
74.1 |
6.4% |
19.5% |
79.2 |
83.9 |
5.8% |
13.2% |
88.9 |
93.6 |
5.4% |
11.7% |
|
Gross margin |
96.5% |
96.5% |
0.0% |
-0.7% |
96.5% |
96.5% |
0.0% |
0.0% |
96.5% |
96.5% |
0.0% |
0.0% |
|
EBITDA |
23.1 |
24.9 |
7.7% |
21.6% |
27.0 |
29.0 |
7.1% |
16.4% |
33.2 |
35.1 |
5.9% |
21.4% |
|
EBITDA margin |
32.0% |
32.4% |
1.2% |
0.3% |
32.9% |
33.3% |
1.2% |
0.9% |
36.0% |
36.2% |
0.5% |
2.9% |
|
Normalised operating profit |
17.8 |
19.5 |
10.0% |
23.5% |
21.5 |
23.4 |
8.9% |
19.7% |
27.0 |
28.9 |
7.3% |
23.7% |
|
Normalised operating margin |
24.6% |
25.4% |
0.8% |
0.6% |
26.1% |
26.9% |
0.8% |
1.5% |
29.3% |
29.8% |
0.5% |
2.9% |
|
Reported operating profit |
10.6 |
12.3 |
16.8% |
172.0% |
14.3 |
16.2 |
13.4% |
31.2% |
19.8 |
21.7 |
10.0% |
34.3% |
|
Reported operating margin |
14.6% |
16.1% |
1.4% |
9.0% |
17.4% |
18.6% |
1.2% |
2.6% |
21.5% |
22.4% |
0.9% |
3.8% |
|
Normalised PBT |
17.2 |
19.0 |
10.3% |
23.9% |
20.9 |
22.9 |
9.1% |
20.2% |
26.4 |
28.4 |
7.4% |
24.3% |
|
Reported PBT |
10.0 |
11.8 |
17.7% |
190.9% |
13.8 |
15.7 |
13.9% |
32.6% |
19.2 |
21.2 |
10.2% |
35.4% |
|
Normalised net income |
13.6 |
15.0 |
10.3% |
22.3% |
16.5 |
18.1 |
9.1% |
20.2% |
20.9 |
22.4 |
7.4% |
24.3% |
|
Reported net income |
8.5 |
10.0 |
17.7% |
-65.2% |
11.7 |
13.3 |
13.9% |
32.6% |
16.4 |
18.0 |
10.2% |
35.4% |
|
Normalised basic EPS ($) |
0.046 |
0.050 |
10.6% |
22.6% |
0.055 |
0.060 |
9.6% |
19.7% |
0.069 |
0.074 |
7.9% |
23.0% |
|
Normalised diluted EPS ($) |
0.044 |
0.049 |
10.6% |
22.6% |
0.053 |
0.058 |
9.6% |
19.7% |
0.066 |
0.072 |
7.9% |
23.1% |
|
Reported basic EPS ($) |
0.029 |
0.034 |
18.0% |
-65.2% |
0.039 |
0.045 |
14.4% |
31.9% |
0.054 |
0.060 |
10.7% |
34.1% |
|
Net debt/(cash) |
(127.7) |
(129.5) |
1.4% |
30.1% |
(153.8) |
(157.5) |
2.4% |
21.6% |
(183.7) |
(189.4) |
3.1% |
20.3% |
|
TPV ($bn) |
9.91 |
10.21 |
3.1% |
15.2% |
11.12 |
11.42 |
2.7% |
11.8% |
12.32 |
12.62 |
2.5% |
10.5% |
|
Take rate |
0.73% |
0.75% |
0.02% |
0.03% |
0.74% |
0.76% |
0.02% |
0.01% |
0.75% |
0.77% |
0.02% |
0.01% |
Source: Edison Investment Research
Exhibit 3: Financial summary
$'m |
2017 |
2018 |
2019 |
2020 |
2021 |
2022 |
2023e |
2024e |
2025e |
||
31-December |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
||
INCOME STATEMENT |
|||||||||||
Revenue |
|
|
24.4 |
35.3 |
50.1 |
56.4 |
62.1 |
63.8 |
76.8 |
86.9 |
97.0 |
Cost of Sales |
(2.3) |
(2.5) |
(5.6) |
(4.9) |
(1.6) |
(1.8) |
(2.7) |
(3.0) |
(3.4) |
||
Gross Profit |
22.1 |
32.8 |
44.6 |
51.5 |
60.5 |
62.0 |
74.1 |
83.9 |
93.6 |
||
EBITDA |
|
|
(2.3) |
6.3 |
10.7 |
15.3 |
22.9 |
20.5 |
24.9 |
29.0 |
35.1 |
Normalised operating profit |
|
|
(4.0) |
4.8 |
4.5 |
11.6 |
18.6 |
15.8 |
19.5 |
23.4 |
28.9 |
Amortisation of acquired intangibles |
(1.3) |
(1.3) |
(1.6) |
(2.2) |
(1.9) |
(1.0) |
(1.2) |
(1.2) |
(1.2) |
||
Exceptionals |
(2.2) |
(1.4) |
(0.3) |
(21.1) |
0.4 |
(5.1) |
0.0 |
0.0 |
0.0 |
||
Share-based payments |
(1.5) |
(4.6) |
(6.8) |
(4.9) |
(6.4) |
(5.2) |
(6.0) |
(6.0) |
(6.0) |
||
Reported operating profit |
(9.0) |
(2.4) |
(4.1) |
(16.7) |
10.6 |
4.5 |
12.3 |
16.2 |
21.7 |
||
Net Interest |
(2.4) |
(0.6) |
(0.4) |
(0.6) |
(0.7) |
(0.5) |
(0.5) |
(0.5) |
(0.5) |
||
Joint ventures & associates (post tax) |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
Exceptionals |
(17.1) |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
Profit Before Tax (norm) |
|
|
(6.4) |
4.3 |
4.1 |
11.0 |
17.8 |
15.3 |
19.0 |
22.9 |
28.4 |
Profit Before Tax (reported) |
|
|
(28.5) |
(3.0) |
(1.3) |
(17.3) |
9.9 |
4.1 |
11.8 |
15.7 |
21.2 |
Reported tax |
(0.1) |
(1.3) |
1.7 |
(1.5) |
1.9 |
0.2 |
(1.8) |
(2.3) |
(3.2) |
||
Profit After Tax (norm) |
(4.8) |
3.4 |
3.2 |
8.8 |
14.3 |
12.3 |
15.0 |
18.1 |
22.4 |
||
Profit After Tax (reported) |
(28.7) |
(4.3) |
0.4 |
(18.8) |
11.8 |
4.3 |
10.0 |
13.3 |
18.0 |
||
Minority interests |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
Discontinued operations |
0.0 |
0.0 |
0.0 |
0.0 |
(5.5) |
24.6 |
0.0 |
0.0 |
0.0 |
||
Net income (normalised) |
(4.8) |
3.4 |
3.2 |
8.8 |
14.3 |
12.3 |
15.0 |
18.1 |
22.4 |
||
Net income (reported) |
(28.7) |
(4.3) |
0.4 |
(18.8) |
6.3 |
28.9 |
10.0 |
13.3 |
18.0 |
||
Basic ave. number of shares outstanding (m) |
150.3 |
217.1 |
246.8 |
273.8 |
294.0 |
298.3 |
297.7 |
299.2 |
302.2 |
||
EPS - basic normalised ($) |
|
|
(0.03) |
0.02 |
0.01 |
0.03 |
0.05 |
0.04 |
0.05 |
0.06 |
0.07 |
EPS - diluted normalised ($) |
|
|
(0.03) |
0.02 |
0.01 |
0.03 |
0.05 |
0.04 |
0.05 |
0.06 |
0.07 |
EPS - basic reported ($) |
|
|
(0.19) |
(0.02) |
0.00 |
(0.07) |
0.02 |
0.10 |
0.03 |
0.04 |
0.06 |
Dividend ($) |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
||
Revenue growth (%) |
42.0 |
44.5 |
42.2 |
12.5 |
10.1 |
2.7 |
20.4 |
13.2 |
11.7 |
||
Gross Margin (%) |
90.7 |
92.9 |
88.9 |
91.3 |
97.5 |
97.2 |
96.5 |
96.5 |
96.5 |
||
EBITDA Margin (%) |
(9.5) |
17.9 |
21.3 |
27.1 |
36.9 |
32.1 |
32.4 |
33.3 |
36.2 |
||
Normalised Operating Margin |
(16.5) |
13.7 |
9.0 |
20.5 |
30.0 |
24.8 |
25.4 |
26.9 |
29.8 |
||
BALANCE SHEET |
|||||||||||
Fixed Assets |
|
|
26.9 |
23.0 |
52.2 |
69.8 |
71.9 |
65.7 |
65.8 |
66.4 |
66.9 |
Intangible Assets |
25.8 |
22.5 |
46.8 |
65.6 |
63.1 |
56.2 |
56.7 |
57.2 |
57.3 |
||
Tangible Assets |
0.4 |
0.3 |
3.5 |
3.8 |
5.7 |
4.4 |
4.8 |
5.3 |
5.9 |
||
Investments & other |
0.7 |
0.3 |
1.8 |
0.5 |
3.1 |
5.1 |
4.3 |
4.0 |
3.8 |
||
Current Assets |
|
|
79.3 |
84.0 |
89.2 |
155.2 |
145.0 |
212.2 |
253.5 |
299.4 |
348.6 |
Stocks |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
Debtors |
59.1 |
51.7 |
53.6 |
92.5 |
82.6 |
90.1 |
107.1 |
125.0 |
142.2 |
||
Cash & cash equivalents |
18.7 |
31.1 |
34.7 |
61.3 |
56.7 |
99.6 |
129.5 |
157.5 |
189.4 |
||
Other |
1.4 |
1.3 |
0.9 |
1.4 |
5.8 |
22.6 |
17.0 |
17.0 |
17.0 |
||
Current Liabilities |
|
|
(78.0) |
(79.6) |
(81.8) |
(139.7) |
(122.1) |
(157.8) |
(188.5) |
(215.8) |
(241.4) |
Creditors |
(75.5) |
(77.4) |
(78.0) |
(136.8) |
(119.6) |
(156.3) |
(187.0) |
(214.3) |
(239.9) |
||
Tax and social security |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
(0.2) |
(0.2) |
(0.2) |
(0.2) |
||
Short term borrowings |
(2.5) |
(2.2) |
(2.1) |
(1.4) |
(1.1) |
0.0 |
0.0 |
0.0 |
0.0 |
||
Other |
(0.0) |
0.0 |
(1.7) |
(1.4) |
(1.3) |
(1.3) |
(1.3) |
(1.3) |
(1.3) |
||
Long Term Liabilities |
|
|
(0.2) |
(0.8) |
(2.6) |
(13.6) |
(12.3) |
(8.7) |
(8.7) |
(8.7) |
(8.7) |
Long term borrowings |
(0.0) |
0.0 |
0.0 |
(10.8) |
(6.7) |
0.0 |
0.0 |
0.0 |
0.0 |
||
Other long term liabilities |
(0.1) |
(0.8) |
(2.6) |
(2.8) |
(5.7) |
(8.7) |
(8.7) |
(8.7) |
(8.7) |
||
Net Assets |
|
|
28.0 |
26.6 |
57.0 |
71.8 |
82.4 |
111.4 |
122.1 |
141.4 |
165.5 |
Minority interests |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
Shareholders' equity |
|
|
28.0 |
26.6 |
57.0 |
71.8 |
82.4 |
111.4 |
122.1 |
141.4 |
165.5 |
CASH FLOW |
|||||||||||
Op Cash Flow before WC and tax |
(2.3) |
6.3 |
7.4 |
15.3 |
22.9 |
20.5 |
24.9 |
29.0 |
35.1 |
||
Working capital |
1.0 |
7.2 |
3.0 |
20.1 |
(7.1) |
27.9 |
13.7 |
9.3 |
8.4 |
||
Exceptional & other |
(5.5) |
0.2 |
(1.3) |
(3.8) |
(3.5) |
1.6 |
0.0 |
0.0 |
0.0 |
||
Tax |
0.0 |
(0.2) |
(0.1) |
(0.3) |
(0.4) |
(0.3) |
(1.0) |
(2.0) |
(3.0) |
||
Net operating cash flow |
|
|
(6.8) |
13.5 |
9.0 |
31.3 |
11.9 |
49.7 |
37.6 |
36.3 |
40.6 |
Capex |
(0.3) |
(0.3) |
(2.1) |
(3.4) |
(5.8) |
(5.3) |
(5.7) |
(6.1) |
(6.4) |
||
Acquisitions/disposals |
0.0 |
(0.2) |
(0.7) |
(36.6) |
0.0 |
26.5 |
5.6 |
0.0 |
0.0 |
||
Net interest |
(0.9) |
(0.6) |
(0.4) |
(1.0) |
(0.6) |
(0.2) |
(0.5) |
(0.5) |
(0.5) |
||
Equity financing |
19.8 |
0.5 |
0.6 |
26.2 |
1.1 |
(1.4) |
(5.4) |
0.0 |
0.0 |
||
Dividends |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
Other |
(1.1) |
0.2 |
(1.5) |
(2.6) |
(6.1) |
(12.7) |
(1.7) |
(1.7) |
(1.7) |
||
Net Cash Flow |
10.6 |
13.1 |
4.857 |
13.8 |
0.5 |
56.6 |
29.9 |
28.0 |
31.9 |
||
Opening net debt/(cash) |
|
|
9.9 |
(16.2) |
(28.9) |
(32.6) |
(49.0) |
(48.8) |
(99.6) |
(129.5) |
(157.5) |
FX |
0.4 |
(0.5) |
(1.1) |
1.3 |
(0.6) |
(5.6) |
0.0 |
0.0 |
0.0 |
||
Other non-cash movements |
15.1 |
(0.0) |
(0.0) |
1.2 |
(0.1) |
(0.3) |
0.0 |
0.0 |
0.0 |
||
Closing net debt/(cash) |
|
|
(16.2) |
(28.9) |
(32.6) |
(49.0) |
(48.8) |
(99.6) |
(129.5) |
(157.5) |
(189.4) |
Source: Boku, Edison Investment Research
|
|
Research: Investment Companies
Templeton Emerging Markets Investment Trust (TEMIT) benefits from the extensive experience of co-managers Chetan Sehgal (lead manager) and Andrew Ness. The trust’s performance has turned a corner as its results tend to be better during periods when share prices are driven by company fundamentals, which are the driver of long-term equity returns, rather than macroeconomic factors. Emerging markets offer a broad range of investment opportunities and are home to a growing number of world-class, leading businesses. While all portfolio stocks are selected on a bottom-up basis, TEMIT’s high-conviction portfolio is widely diversified by geography, sector and market cap. Its balanced structure means the fund has potential to outperform in both up and down markets.