Araxi (AXX) H2 2026 earnings summary

Executive summary

• Completed first full year under the Araxi brand after rebranding from Capital Appreciation in 2025, with significant strategic progress and the acquisition of 80% of Pay@, a major payments platform, for less than 8x EBITDA, funded by ZAR 800 million senior secured facility and ZAR 200 million cash.

• Focused on disciplined execution, operational improvements, and integrating Pay@ to drive future growth, while maintaining strong relationships with blue-chip clients and investing in talent and technology.

• Software division saw a 77% increase in underlying EBITDA, driven by cost-saving initiatives and improved sales momentum.

• Recognized with multiple industry awards for growth and innovation.

• Strategic focus on expanding payment solutions, software innovation, and international expansion.

Financial highlights

• Cash flow from operations rose 25% year-over-year to ZAR 260 million.

• Underlying EBITDA increased 5.9% to ZAR 283.2 million, with margin improvement driven by software division efficiency.

• Underlying headline earnings per share up 10.1%, while reported EPS declined 18% due to one-off items.

• Underlying revenue decreased 3.6% year-over-year, and reported revenue decreased 6.8% to ZAR 1,166.2 million, mainly due to a large software contract in the prior year and delayed terminal sales.

• Dividend of ZAR 0.12 per share for the year, supported by strong cash generation.

Outlook and guidance

• Anticipates further growth from Pay@ integration, international expansion, and new product launches such as Halo Dot and MicroPOS.

• Software division has turned the corner, with improved pipeline and utilization rates heading into FY 2027.

• Well-capitalised with strong management and technology to deliver on growth strategy, with broad organic and acquisitive growth opportunities.

• Strong pipelines across divisions and significant orders already placed for H1'27.

• Economic and regulatory challenges acknowledged, but business remains well-positioned for both organic and acquisitive growth.