Boku 2021 group revenues expected to be approximately $69.0m, an increase of 22%

Growth

Boku Inc (LON:BOKU), a leading global mobile payment and mobile identity company, has provided the following unaudited trading update for the financial year ended 31 December 2021.

The Group grew the volume processed through its mobile first payments network of Direct Carrier Billing, eWallets and Real Time Payments by 18% in 2021 to exceed $8.2bn. Volumes generated from the newer payment methods – eWallets and Real Time Payments – increased five-fold. The Identity division, which, as announced earlier today, is being divested, also continued its improving performance. These improved operating metrics led to an expected 22% increase in Group revenues and an expected 31% increase in Group Adjusted EBITDA*, as Boku invested to build out the M1ST payment network.

Group highlights

·    Group revenues for 2021 expected to be approximately $69.0m, an increase of 22% (2020: $56.4m)    

·    Group Adjusted EBITDA* increased by 31% to an estimated $20.0m (2020: $15.3m)

·    On a constant currency basis, both Group revenues and EBITDA would have been $2.3m higher

·    Group cash of $62.4m on 31 December 2021 (30 June 2021: $48.6m)

o  $11.88m of the $20m debt used to acquire Fortumo paid down at year end

·    Average daily cash balance – a measure which smooths out the effect of carrier and merchant payments, was $50.5m in December 2021 (June 2021: $38.0m)

Boku Payments division

Boku Payments division had another very positive year with progress on DCB, eWallets and Real Time Payments:

·    Payments division revenues increased 21% to an estimated $61.9m (2020: $51.2m) and represents approximately 90% of the Group total

·    Total Processed Value (“TPV”)** of $8.2bn up 18% (2020: $6.9bn)

·    Payments revenues on a constant currency basis would have been $2.3m higher and TPV would have been at least $360m higher

·    Payments EBITDA* up 21% to an estimated $22.9m (2020: $19.0m), reflecting investment into the ‘mobile first’ M1ST payments network in H2, as previously flagged

·    New launches during the year with Google, Netflix, DAZN, Spotify, Epic Games, Facebook, Amazon, Riot Games and Tinder across DCB, eWallets and Real Time Payments

·    Monthly Active Users (“MAU”) increased by 3.8m to 32.3m in December 2021, growth of 13% over December 2020

·    M1ST network expanded to over 7bn end user accounts, 42% of which are non-DCB

·    Volumes processed from eWallets and Real Time Payments increased five-fold during the year, from a small base. eWallets and Real Time Payments MAUs increased nine-fold to over 1.1m

·    Non-DCB Customers now include leading global companies in digital advertising, streaming music, streaming video, games and games consoles

Boku Identity division

The Identity division saw strong revenue growth in 2021 and improved EBITDA as a result of good growth, particularly in Asia.

·    Identity revenue growth of 37% to an estimated $7.1m (2020: $5.2m) with strong growth outside of the U.S.

·    Reduced Identity EBITDA* loss of approximately $2.9m (2020: $3.9m loss)

·    Connections added in Germany, Spain, Italy and Indonesia drove increased usage

·    Identity division to be sold to Twilio for a maximum consideration of $32.3m as announced earlier today

*           Adjusted EBITDA (Earnings before interest, taxation, depreciation and amortization): Adjusted for stock option expenses, Forex gains/losses and Exceptional items

**        TPV is the US$ value of transactions processed by the Boku platform

Jon Prideaux, Boku’s CEO, commented: “We are pleased with our 2021 performance with both Payments and Identity showing good growth, and Group revenue and EBITDA running considerably ahead of last year. Without a significant exchange rate headwind, mostly affecting the second half, both revenues and EBITDA would have been materially higher. These results show that Boku has been able to maintain its performance through the pandemic, despite some distortion to traditional seasonality patterns which we expect to revert to normal in 2022. Our growth has enabled us to make significant investment in the second half in building out our Mobile First ‘M1ST’ payments network.

“Following the disposal of Boku Identity to Twilio, Boku enters 2022 as a pure-play payments company, with continued strong growth in the underlying metrics: new users and TPV. Underpinning this performance is Boku’s position as the Direct Carrier Billing (DCB) provider, mostly exclusively, to the world’s largest digital merchants. Importantly, during the year we further expanded our payments reach, with eWallet and Real Time Payment volumes increasing five-fold, albeit from a small base. It is clear that these new methods will be a key factor driving Payments revenue growth in 2022.

“We look forward to reporting our audited results in March 2022.”

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