EML Payments (EML) H2 2026 earnings summary

Executive summary

• Major restructuring completed by June 2026, refreshing 51 senior positions and establishing a global operations center, delivering 35% cost savings and enhanced efficiency.

• FY 2026 financial performance missed expectations due to slower onboarding, delayed contract activations, and softer trading in the Northern Hemisphere in H2.

• Product innovation advanced, including new mobility solutions and a benefit maximizer card in APAC, with development embedded under new leadership.

• Commercial pipeline remains strong at AUD 109 million, with significant contract wins, renewals, and conversion rates ahead of plan.

• Strategic investments in technology and partnerships, notably Project Arlo and a 28% stake in Tendren, underpin future growth.

Financial highlights

• Revenue from continuing operations was AUD 206.8 million, down 6% year-over-year; customer revenue was AUD 150 million, down 4%.

• Interest revenue declined 11% to AUD 56.7 million due to lower central bank rates.

• Underlying EBITDA fell 18% to AUD 48.3 million, within revised guidance.

• Net loss after tax from continuing operations was AUD 19.7 million, a significant improvement from AUD 53 million loss prior year.

• Cash at year-end was AUD 37.8 million, down AUD 21.6 million, mainly due to class action settlements, investments, and restructuring.

Outlook and guidance

• FY 2027 priorities: convert wins to revenue, activate Arlo, renew key clients, and grow pipeline to AUD 150 million.

• Underlying EBITDA guidance for FY 2027 is AUD 50 million–AUD 54 million, with improved customer and interest revenue and yields forecast to rise by ~20bps.

• Pro forma free cash flow forecast of AUD 30 million–AUD 35 million in FY 2028 as transformation and legacy costs subside.

• Continued investment in Arlo (AUD 17 million in FY 2027) and focus on cash flow management.

• Mobility solution to go live with initial paying clients; Arlo UK migration and APAC deployment scheduled.