Release Date: August 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Nayax Ltd (NYAX, Financial) returned to positive operating profit for the first time since 2018, marking a significant milestone.
- Revenue reached a record level of $78.1 million in Q2 2024, a 39% increase from Q2 2023.
- The company added over 9,000 new customers in Q2, reaching a total of 85,000 customers.
- Gross margin improved to 44.3% in Q2 2024, up from 37.1% in Q2 2023, reflecting operational efficiency.
- Nayax Ltd (NYAX) completed two strategic acquisitions, expanding its product offering and market reach.
Negative Points
- Finance expenses were negatively impacted by a $1 million write-off due to a change in the fair value of a minority interest.
- Revenue and adjusted EBITDA were negatively impacted by a $1 million purchase accounting adjustment related to an acquisition.
- The contribution from recent acquisitions, VM Tech and Roseman, was not significant in Q2 2024.
- Operating expenses are expected to increase due to the addition of recent acquisitions.
- The take rate increase to 2.7% may be influenced by customer and geography mix, which could fluctuate.
Q & A Highlights
Q: Can you talk about some of the progress that you're making in the high-growth verticals such as EV, parking, and transit?
A: Yair Nechmad, CEO, mentioned that while they are not providing extensive details, there is significant progress in these areas. The EV market is becoming more regulated, and Nayax is optimistic about its potential, although it is not yet a significant part of their business.
Q: Is there any way to think about the quarterly progression in the back half, considering hardware volatility?
A: Sagit Manor, CFO, stated that historically, the second half of the year is stronger than the first. They are confident in their guidance due to a strong backlog and growing recurring revenue, which was 68% of total revenue in Q2.
Q: Can you provide an outlook for the recurring revenue gross margins for the remainder of the year?
A: Sagit Manor highlighted improvements in gross margins across all areas, with recurring revenue margins increasing from 47% to 52%. This was driven by efficiencies from their call center in Romania and improved transaction processing margins.
Q: What was the contribution to revenue from VM Tech and Roseman, and how should we think about revenue growth going forward?
A: Sagit Manor explained that the contributions from these acquisitions were not significant, with VM Tech contributing approximately $2 million in Q2. The focus is on integration, and the full impact will be seen in future quarters.
Q: The take rate increased to 2.7% from 2.6% last quarter. Is this sustainable, and what factors influenced it?
A: Sagit Manor attributed the increase to customer and geography mix, as well as more EV charging and parking transactions, which are areas where they do not have direct influence.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
