PAX Global Technology Limited Announces 2021 Interim Results
PAX Global Technology Limited (HKSE stock code: 00327.HK), one of the world’s leading providers of electronic payment terminal (“E-payment terminal”) solutions and related services, is pleased to announce the unaudited interim results for the six months ended 30 June 2021 (the “Period”).
The pandemic continues to pose a significant impact on the global economy and development trends. Governments and financial institutions all over the world have focused, more than ever before, on initiatives to promote increasingly cashless societies, resulting in the rapid development of financial technology and record levels of electronic payment acceptance. To capture the business opportunities attribute to the consumers’ changing payment behaviors under the new normal, retail and catering merchants are spurring the pace of adopting electronic payment terminals. Thanks to the wide product portfolio and industry-leading cloud-based MAXSTORE platform, in the first half of 2021, the Group had robust revenue growth by 30.6% to HK$ 3,318.7 million. PAX demonstrated stability in supply chain management and product delivery, providing full support to acquiring banks and payment service providers to accelerate terminal deployment during the pandemic. All these contributed to gaining recognition from global customers with growing market share. PAX has become the preferred business partner of more international and regional mainstream acquiring banks and payment service providers.
“PAX Android smart terminals + SaaS solutions” delivers new intelligent business capabilities for merchants
In the face of the challenges brought by the pandemic, more merchants recognise the value of the business intelligence with digitization. Thanks to PAX’s innovative Android smart terminals and the cloud-based MAXSTORE platform, even small merchants can embrace the digitization of payments to seize the opportunities under the new normal. During the first half of 2021, sales of PAX Android smart terminals increased by 86.0% compared to the same period of the previous year.
The MAXSTORE ecosystem continues to gain market traction globally with currently over 3 million terminals connected. Through MAXSTORE, millions of merchants can access over 5,000 applications covering payment, ordering, ticketing, inventory handling, marketing & loyalty initiatives and tax refunds, etc. Revenues generated from SaaS solutions surged by 319.6% compared to the same period of the previous year. As the global shipment of PAX Android terminals continues to soar, the contribution of SaaS solutions is expected to increase gradually in the coming years.
Mr. Jack LU, Chief Executive Officer of PAX, stated, “Continuous innovation with a superior quality-oriented approach is the cornerstone of the PAX brand. The Group will prioritize Android payment terminal solutions as the key pillar of our research and development and roll out more innovative products for diversified business application scenarios. Meanwhile, PAX will further devote investment into the SaaS solutions, as well as explore cooperation with more acquirers and value-added software application providers to jointly build a global SaaS ecosystem.”
PAX Strengthens its International Leadership Position
Riding the tailwind of electronic payments, PAX has established closer cooperation with its extensive global partner network. Acquiring banks and payment service providers in over 120 countries have been accelerating the adoption of PAX terminals. the first half of 2021, the Group achieved strong performance, particularly in the EMEA and USCA regions with 63.2% and 71.7% growth respectively.
Latin America and the Commonwealth of Independent States (LACIS)Brazil continued to be the key market for PAX in the region. Since the onset of the pandemic, Brazilian financial regulators and financial institutions have initiated a series of reforms to build up the country’s electronic transaction acceptance infrastructure, coupled with surging nationwide merchant networks of our acquiring partners, providing a strong impetus for the growth of PAX’s terminal business in Brazil. In the first half of 2021, PAX successfully launched its first M-series product, the M30 Android PayPhone in Brazil, which is compliant to all major industry standards such as PCI 6.0, EMV and NFC Contactless.
In Argentina and Russia, PAX has achieved significant sales growth. Meanwhile, the Group continues to strengthen its commitment to other promising markets such as Mexico and Chile.
Europe, Middle East and Africa (EMEA)
Driven by the competitive edge offered by the cloud-based MAXSTORE platform, the value of PAX Android smart terminals has been unlocked across EMEA. In the first half of 2021, the sales coming from the EMEA region surged by 63.2%.
In Europe, PAX has delivered particularly positive performances in Italy, the United Kingdom, Greece, Germany and Poland. Thanks to the rising transaction limits for contactless payments among many European countries during the pandemic, the demand for payment terminals boosted. Alongside with the market shift toward Android smart terminals, as well as large estates of legacy devices with older PCI 3.0 certification being replaced by acquiring banks and payment service providers, the demand for PAX products will continue to grow.
Many countries in the Middle East and Africa have also accelerated their adoption of digital financial services. During the period, the Group achieved strong sales results in Nigeria, Egypt and Saudi Arabia.
Asia Pacific (APAC)
Alongside PAX’s rising global brand recognition, China’s digital transformation is spurring with huge market potential and has continually created more synergies with other Asia-Pacific markets. The Group has decided to group the sales of China under APAC. During the period, sales in China represented 24.7% of overall APAC revenues. In the first half of 2021, the shipment of PAX Android smart terminals was on the rise across this region, particularly in India, Malaysia and Vietnam.
In India, PAX is already considered as the leading payment terminal supplier. PAX sales in India more than doubled during the period, as the nation’s digital payment infrastructure undergoes rapid expansion thanks to multiple initiatives by the central bank and local government.
The United States of America and Canada (USCA)
In the United States and Canada (USCA), contactless payments have been booming since the outbreak of the pandemic. According to the eMarketer report, the number of instore mobile payment users in the United States is expected to surpass 100 million by the end of 2021. As the first provider of Android smart terminals in North America, the Group has delivered new-generation PAX terminals to merchants through the nationwide extensive Independent Sales Organization (ISO) network. During the period, PAX sales in this region increased substantially by 71.7%.
The A920 smart terminal was the best-selling model in the North America, with widespread adoption from an increasing number of top-tier retailers and Quick Service Restaurant (QSR) chains in the first half of 2021. With the Group’s continuous dedication in this region, PAX brand is gaining more traction and market share. It is expected that the North America will continue to be one of the key global markets for the Group.
Mr. Jack LU, Chief Executive Officer of PAX, commented, “In view of the bright prospect of the international payment terminal market, PAX has been actively planning for a new industrial base to increase production capacity and support long-term business development. In July 2021, the Group entered into the construction contracts in relation to the construction works of the new industrial base. The construction is expected to be completed in the fourth quarter of 2022 at the earliest. The completion of the industrial base will greatly enhance the production capacity of PAX terminal products, build an enhanced and concentrated supply chain, strengthen the Group’s core competitiveness and lay a solid foundation for PAX’s future business development.”