{"id":6583,"date":"2026-06-10T10:42:39","date_gmt":"2026-06-10T10:42:39","guid":{"rendered":"https:\/\/www.fintechpulse8.com\/?p=6583"},"modified":"2026-06-10T10:42:39","modified_gmt":"2026-06-10T10:42:39","slug":"araxi-shows-itself-on-a-really-good-footing-going-into-fy-2027","status":"publish","type":"post","link":"https:\/\/www.fintechpulse8.com\/?p=6583","title":{"rendered":"Araxi shows itself \u2018on a really good footing\u2019 going into FY 2027"},"content":{"rendered":"<p><\/p>\n<div>\n<p><iframe loading=\"lazy\" src=\"https:\/\/iframe.iono.fm\/e\/1684521?layout=modern\" width=\"100%\" height=\"170\" frameborder=\"0\" data-mce-fragment=\"1\"><\/iframe><\/p>\n<p>You can also listen to this podcast on iono.fm here.<\/p>\n<p><strong>SIMON BROWN:<\/strong> I\u2019m chatting with Bradley Sacks. He\u2019s CEO of Araxi. The year ending March saw revenue 6.8% down and Heps [headline earnings per share] down 18.2%, but dividend unchanged at 12 cents.<\/p>\n<p>Brad, appreciate the time. You make the point that the year-on- year comparison may be not fair, negatively impacted by a delayed delivery of a fairly chunky terminal order. Of course, you had a fairly big contract that came in during the prior year. If we take those two out, how was your year operationally otherwise?<\/p>\n<p><strong>BRADLEY SACKS:<\/strong> Operationally, we\u2019re very pleased with how the year went across metrics that are easily comparable. We had licence revenue up in our Terminal business, up 31%.<\/p>\n<p>We exited the period with Ebitda [earnings before interest, tax, depreciation and amortisation] growth in our software business up 77%.<\/p>\n<blockquote>\n<p>We had Terminal sales up by \u2013 sorry, the estate grew by 5%. We\u2019re verging on 500\u00a0000 terminals in the not too distant future.<\/p>\n<\/blockquote>\n<p>So we are very pleased with how the business is operating.<\/p>\n<p>Read: Araxi to acquire 80% of Pay@ group in R1bn deal<\/p>\n<p>As you noted, there are some accounting issues that make the comparison a little challenging. But once we normalise for those things, Heps were up 10%, which we think in this climate is pretty good, given the investments that we\u2019re making.<\/p>\n<p>And with the acquisition of Pay@ \u2013 the pro forma effect of Pay@ \u2013 which is the transaction we announced earlier in the year, our earnings would have been up 20%. So we think we are on a really good footing going into FY\u00a02027.<\/p>\n<p><strong>SIMON BROWN:<\/strong> And Pay@ from May \u2013 about a billion rand for 80%. What does it give you? Is this tech you didn\u2019t have or is it more leapfrogging you ahead with that acquisition?<\/p>\n<p><strong>BRADLEY SACKS:<\/strong> It gives us a lot of things that we didn\u2019t have. The part that\u2019s the most difficult to replicate is the network of points of presence and capabilities that exist. They are in hundreds of retailers.<\/p>\n<blockquote>\n<p>They have 150\u00a0000 mobile points of presence, and they are embedded in the software apps of many of their clients \u2013 which include banks and fintechs and others.<\/p>\n<\/blockquote>\n<p>That means that we\u2019re in millions of downloads on people\u2019s phones already.<\/p>\n<p>What this really does is it drives for financial inclusion and allows you to meet the customer wherever they are, and allow them to pay in whatever tender type and instrument they would like. So it starts a whole new pillar of our business.<\/p>\n<p>Although it\u2019s payments related, it\u2019s not duplicative with anything that we do, but we can certainly enhance what they\u2019re doing with the portfolio of capabilities that we have within Araxi.<\/p>\n<p><strong>SIMON BROWN:<\/strong> How did you fund it? I ask because your dividend remains flat at 12\u00a0cents. I have to say, I thought you might take it out of the dividend, but apparently not.<\/p>\n<p><strong>BRADLEY SACKS:<\/strong> So it was your question \u2013 how did we find it?<\/p>\n<p><strong>SIMON BROWN:<\/strong> Fund it, fund it. How did you fund it?<\/p>\n<p><strong>BRADLEY SACKS:<\/strong> We funded it through R200\u00a0million of cash that we had. We had over R325\u00a0million. So we used R200 of our own resources and we borrowed R800\u00a0million from Investec.<\/p>\n<p>Listen: PGMs under pressure but offering opportunity<\/p>\n<p><strong>SIMON BROWN:<\/strong> And you\u2019re still very, very cash generative. This is a very strong cash business. Cash from operations up 25%, almost R260 million.<\/p>\n<p><strong>BRADLEY SACKS:<\/strong> Exactly. And so on a pro forma basis, the Ebitda at Pay@ is R150\u00a0million. Most of that will convert into cash. We think that will be close to R400\u00a0million in cash generation on a pro forma basis.<\/p>\n<p><strong>SIMON BROWN:<\/strong> You mentioned at the top a delay in a substantial terminal order. You also mentioned the worldwide shortage of microchips, and that\u2019s delaying timely delivery of terminals. This microchip \u2013 is this the demand from AI? Is this the Strait of Hormuz? What\u2019s the problem with microchips?<\/p>\n<p><strong>BRADLEY SACKS:<\/strong> I think across the entire semiconductor industry all electronics use microchips. You\u2019ve seen a diversion of capacity into higher GPUs [Graphics Processing Units] as opposed to CPUs [Central Processing Units] and I think the effect that we felt was somewhat momentary, because we haven\u2019t encountered a similar effect or consequence in additional orders.<\/p>\n<p>We have seen an increase in pricing on semiconductors, and that is being felt by everybody and is affecting people from handset manufacturers for phones, televisions, cars \u2013 it\u2019s across all areas.<\/p>\n<p>Read:<br \/>Semiconductor giants are powering the AI revolution<br \/>AI bubble debate gets real as chip stocks rally turns historic<\/p>\n<p><strong>SIMON BROWN:<\/strong> Yes. I look across my desk \u2013 just everything has microchips, except maybe my pen, but everything else has.<\/p>\n<p>A last question. Your Halo Dot enabled Apple\u2019s Tap to Pay iPhone launch in South Africa. Maybe I\u2019m missing it, but I think that\u2019s a fairly big deal.<\/p>\n<p><strong>BRADLEY SACKS:<\/strong> It is a big deal. So it\u2019s not a fairly big deal, \u00a0It\u2019s a big deal. We are particularly proud of that. We think it\u2019s tremendous. You have to be a gateway service provider to do that, licensed by Apple. There are only a handful that have deserved that qualification. It allows us to do these launches globally.<\/p>\n<p>Read: Capital Appreciation rides the digitalisation wave at home and abroad<\/p>\n<p>We showed a slide today in a presentation of all the implementations that we have around the world. So we have things under way in Brazil, in Mexico, in the United States, in the Middle East, in Turkey, in Europe, in the UK, in Singapore, and in countries across Africa.<\/p>\n<p>So we are really starting to see some traction in the Halo Dot offering, and we think it is a testament to the basis upon which the platform was developed.<\/p>\n<p>Read:<br \/>Some 70% of SMMEs in SA still married to cash \u2013 iKhokha\u00a0co-founder<br \/>Apple and Samsung Pay lead SA\u2019s digital Black Friday shopping shift<br \/>The evolution of payments in South Africa<\/p>\n<p><strong>SIMON BROWN:<\/strong> Yes. We\u2019ll leave it there. Bradley Sacks, CEO of Araxi, appreciate the time.<\/p>\n<\/p><\/div>\n<p>#Araxi #shows #good #footing<\/p>\n","protected":false},"excerpt":{"rendered":"<p>You can also listen to this podcast on iono.fm here. SIMON BROWN: I\u2019m chatting with Bradley Sacks. He\u2019s CEO of Araxi. The year ending March saw revenue 6.8% down and&hellip; <\/p>\n","protected":false},"author":1,"featured_media":6584,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[9000,9001,66,405],"class_list":["post-6583","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing","tag-araxi","tag-footing","tag-good","tag-shows"],"_links":{"self":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/6583","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6583"}],"version-history":[{"count":0,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/6583\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/media\/6584"}],"wp:attachment":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6583"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6583"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6583"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}