Tyro chips away at payments

Break-even is "in sight" for specialist payments provider Tyro Payments, though management is not putting a date on this milestone-to-be.

Tyro reported a loss of A$1.8 million for the year to June 2011, the same size as the loss incurred in 2010.

Tyro is achieving reasonable top-line growth in for what remains an immature business. The company began processing card payments under a restricted banking licence in 2007.

Revenue from merchant fees increased by 47 per cent to $18.6 million, though net revenue from transaction processing increased by only 25 per cent, thanks to higher commission payments to one sales partner who had deferred some commission payments from the previous year.

Accumulated losses at Tyro stand at $28 million.

In the month of June 2011, the transaction volume reached 2.55 million transactions for a value of $183 million. This represented growth of 51 per cent by volume and 44 per cent by value over June 2010

Merchant numbers at June 2011 were 4250.

Tyro's market share remains around 0.5 per cent.
 
Jost Stollmann, chief executive of Tyro, said that, taking into account the commission arrangements for one partner (who back-loaded expenses into 2011) and foreign exchange losses in 2011, the company recorded a "significant improvement in operating profit" over the year.

He said Tyro was a business with "significant fixed-cost characteristics" and that "break-even is in sight".

Stollmann said the firm was now targeting hospitality sector to complement its early strength in medical practices. He said Tyro technology could handle bill splitting and tipping at the point of sale with mobile devices, for example.

The company continues to rely on funding from directors and key shareholders, four of whom have provided a $2.5 million loan that is likely to convert into equity later this year.


Note: volume and value and market share data for FY2011 corrected, 14 October 2011.