REG - Boku Inc - Interim Results
24/09/2024 07:00
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RNS Number : 3248F Boku Inc 24 September 2024
24 September 2024
Boku, Inc.
("Boku" or the "Company" and, together with its subsidiaries, the "Group")
Interim results for the six months ended 30 June 2024
Continued revenue growth as we lift our ambition to be the world's best
localised payment partner for global commerce
Boku (AIM: BOKU), a global network of local payment solutions, is pleased to
announce the following unaudited interim results for the six months ended 30
June 2024 ("H1 2024").
Financial Highlights
· Revenues increased 24% to $47.3m in H1 2024 (H1 2023: $38.2m), up 30% on a
constant exchange rate(1) basis driven by continued increases in transaction
volumes for our global merchants across all Local Payment Methods(2) ("LPMs").
· Revenues include $11.9m from digital wallets and Account to Account(2)
("A2A"), up 64% from $7.3m in H1 2023, showing continued adoption by
merchants, following our strategic initiatives focused on enhancing and
expanding our product offerings in these areas.
· Adjusted EBITDA(1) increased 18% to $14.2m in H1 2024 (H1 2023: $12.1m
restated) representing an Adjusted EBITDA margin(1) of 30.1% as we keep our
commitment to maintain Adjusted EBITDA margin above 30% while we continue to
invest in the business.
· An operating loss of $0.4m was reported for H1 2024 (H1 2023: operating profit
$2.1m restated). This was primarily due to increases in foreign exchange
revaluation losses on non-USD balances, share based payment expenses driven by
increases in both the number of awards granted and our average share price
together with accelerated amortisation charges relating to a legacy platform.
· Boku's 'own' cash(1) increased to approximately $75m at the period end (H1
2023: $54.4m and FY 2023 $70.4m). Total group cash was $148.5m at 30 June 2024
up from $113.9m at 30 June 2023 (FY 2023 $150.9m). The Group remains debt
free.
· The average daily cash balance(1), a measure which smooths out the effect of
carrier collections and merchant payments, was $138.6m in June 2024, up from
$105.8m in June 2023.
· In H1 2024, $1.6m was spent repurchasing 700,000 of Boku's own shares under
the share buyback scheme.
· Interest income increased to $1.6m in H1 2024 (H1 2023: $0.5m) as more cash
was moved to longer term deposits.
· A higher Boku share price drove a fair value loss of $3.3m on the Amazon
warrants (H1 2023: fair value gain of $0.02m).
Operational highlights
· We continue to see significant growth in both users and payment volumes:
o 30% increase in monthly active users(2) ("MAUs") in June 2024 to 79.6m (June
2023: 61.2m).
o 39.9m new users made their first payment or bundling transaction with Boku
during the first half of the year (H1 2023: 32.7m).
o Total Payment Volume(2) ("TPV") up 16% to $5.8bn (H1 2023: $5.0bn) and up 26%
on a constant exchange rate basis in the period.
· Growth driven by strong performance in digital wallets and A2A connections:
o MAUs increased 86% to 8.8m in the month of June 2024 (June 2023: 4.7m).
o New users increased by over 46% to 9.2m in H1 2024 (H1 2023: 6.3m).
· Take rate(2) increased to 0.81% in H1 2024 (H1 2023: 0.76%) driven by higher
take rates from digital wallet revenues.
· Over 50 new launches across LPMs in H1 2024 with new and existing merchants
including Netflix, Sony and Google.
The shareholders have approved the board's proposal for a new stretch
restricted share unit plan. This plan will support and reward the performance
of the executive management team of the Company in a fair, transparent and
proportionate manner.
Stuart Neal, Boku's CEO, commented:
"Following on from a very positive 2023, the first half of 2024 has seen Boku
continue to demonstrate strong revenue growth, largely driven from existing
merchants. We are committed to supporting merchant growth and are lifting our
ambition to be the world's best localised payments partner for global
commerce. The first half has therefore also seen us increase our investment in
our products and the infrastructure required to scale whilst maintaining our
Adjusted EBITDA margin above 30%.
"It is pleasing to see continued double-digit growth in our Direct Carrier
Billing ("DCB") product, proving once again its resilience and the value it
adds for our merchants. Digital wallets and A2A payments have kicked on again
and comprised 25% of total Group revenues in H1 2024. We have expansion plans
for these products with all our key merchants, most of which we would expect
to see rolled out over the coming two years; thus, it is our expectation that
the product mix within our business will continue to see an increasing shift
towards these payment types.
"We reiterate our expectation that 2024 will be a year of solid top line
growth that is in turn funding an increase in investment, with Adjusted EBITDA
margins staying broadly flat on 2023. We remain confident that we will achieve
expectations for the full year."
(1) These represent alternative performance measures ("APMs") for the Group.
Refer to the Non-IFRS financial information section of Boku's 2024 Interim
Report for a summary of APMs used, together with their definitions.
(2) For a full list of definiitons and abbreviations used by the Group, refer
to the Glossary at the end of Boku's 2024 Interim Report.
Investor Presentation
The Company will be hosting an online investor presentation and Q&A
session at 5.30 p.m. BST, today, Tuesday 24 September 2024. This session is
open to all existing and prospective shareholders. Those who wish to attend
should register via the following link where they will be provided with access
details
https://us02web.zoom.us/webinar/register/WN_nTiw40r8QsqXtvpPZKXyww
(https://us02web.zoom.us/webinar/register/WN_nTiw40r8QsqXtvpPZKXyww)
Participants will have the opportunity to submit questions during the session,
but questions are welcomed in advance and may be submitted to:
boku@investor-focus.co.uk (mailto:boku@investor-focus.co.uk) .
Enquiries:
Boku, Inc. +44 (0)20 3934 6630
Stuart Neal, Chief Executive Officer
Robert Whittick, Chief Financial Officer
Investec Bank plc (Nominated Advisor & Joint Broker) +44 (0)20 7597 5970
Nick Prowting / Kamalini Hull / Patrick Robb
Peel Hunt LLP (Joint Broker) +44 (0)20 7418 8900
Neil Patel / Ben Cryer / Kate Bannatyne
IFC Advisory Limited (Financial PR & IR) +44 (0)20 3934 6630
Tim Metcalfe / Graham Herring / Florence Chandler
Note to Editors:
Boku, Inc. (AIM: BOKU) is a leading global provider of mobile payment
solutions. Boku's mobile-first payments network, including mobile wallets,
direct carrier billing, and account to account/real-time payments schemes,
reaching over 7.5 billion mobile payment accounts through a single
integration.
Customers that trust Boku to simplify sign-up, acquire new paying users and
prevent fraud include global leaders such as Amazon, Meta Platforms, Google,
Microsoft, Netflix, Sony, Spotify and Tencent.
Boku Inc. was incorporated in 2008 and is headquartered in London, UK, with
offices in the US, India, Brazil, China, Estonia, Germany, Indonesia, Ireland,
Japan, Singapore, Spain, Taiwan and Vietnam.
To learn more about Boku, Inc., please visit: https://www.boku.com
(https://www.boku.com)
CHIEF EXECUTIVE OFFICER'S REPORT
The first half of 2024 has seen Boku continue to demonstrate solid revenue
growth, following on from a very strong 2023. As presented at the FY 2023
results, 2024 will be a year of continued top line growth, largely from
existing merchants, coupled with increased investment in the business as we
lift our ambition to be the world's best localised payments partner for global
commerce.
The planned investment comes in four focused areas:
· Investment in the functionality required to deliver the next wave
of growth opportunities for our existing merchants (some of which are
scheduled to technically land in Q4 2024)
· Investment to scale our business to attack the global commerce
market, allowing for a wider range of LPMs and market-leading money movement
capabilities
· Investment to fund R&D projects to design and build an
off-the-shelf Boku product that can target a wider set of global merchants
(either directly or via channel partners)
· Investment in our delivery capability to ensure that the whole
company can scale efficiently and maintain good operational gearing
We believe that the above initiatives are fully costed within existing analyst
projections and covered with existing cash reserves.
More of the same in H1
Revenues in the period were up 24% (30% if you remove the impact of exchange
rate movements, largely the negative impact of a depreciating Japanese Yen
over the period).
It is pleasing to see continued double-digit growth in our Direct Carrier
Billing (DCB) product, proving once again its resilience and the value added
for our merchants. DCB allows consumers to make digital purchases and charge
those purchases to their phone bill, which is settled at the end of the
billing period. In that regard, DCB is the original Buy Now Pay Later (BNPL)
product. It is for this reason that it proves to be a highly effective way for
merchants to attract more users in any given market. We have seen continued
strong performance in heritage DCB markets such as Germany, UK, Japan, Taiwan,
Switzerland and Saudi Arabia, as well as a general ramp in demand across the
Middle East.
Digital wallets and Account to Account (A2A) payments have kicked on again and
during H1 comprised 25% of total Group revenues. We now have expansion plans
for these products with all of our key merchants in new and existing markets.
Thus, it is our expectation that the product mix within our business will
continue to see an increasing shift towards these payment types.
It is by design that our success is directly linked to the success of our
merchants. Being useful for our merchants is key to the ongoing success of our
business, which is why Monthly Active Users are tracked as a measure of how we
have performed for our merchants. In June 2024, 79.6m users successfully
completed a transaction using the Boku platform to access the services
provided by our merchants, 30% more users than did so in June 2023.
An operating loss of $0.4m was reported for the six months to 30 June 2024 (H1
2023: operating profit $2.1m). This was primarily due to increases in foreign
exchange revaluation losses on non-USD balances, accelerated amortisation
charges relating to a legacy platform and higher share-based payment expenses
driven by increases in both the number of awards granted and our share price.
Innovate or die
Juniper research points to the global ecommerce market growing to $11 trillion
(tn) by 2028 and 59% of this total payment volume is expected to be via Local
Payment Methods (LPMs). (Boku & Juniper Research, 2024)(1)
Boku already possesses a formidable set of assets to be successful in this
market - we serve some of the largest and most exacting merchants in the
world, we have high quality connections to c.300 individual LPMs, licenses to
move money in 60 countries and a flexible set of connections that offer
card-like conversion rates. Put simply, we remove complexity for our merchants
as they attempt to grow their businesses internationally.
To fully maximise the long-term potential for Boku, we are now adding scaling
capabilities as described below.
With the addition of A2A payments to our network, consumer funds will be
flowing through our regulated bank accounts in real time. A significant
emphasis is being placed on compliance, segregation of funds, automated
reconciliation and faster settlement of funds, both domestically and cross
border.
To deliver a differentiated global money movement capability, over the next
6-9 months we are building a sophisticated treasury platform, supported by a
number of tier one banking partners, offering best in market payments
capability and foreign exchange rates for our merchants.
Scaling the back end of our platform will allow for strong margin growth as
Boku rolls out to the broader ecommerce market and adds new payment products
in new geographies such as UPI in India and PIX in Brazil.
In addition to scaling the platform, we also welcomed some new executives to
the Boku leadership team during H1, who will add vast experience and knowhow
when it comes to helping the business navigate the tricky step from start up
to scale up. Victoria Rogers (formerly AO.com) joined as Chief People Officer,
Paul Jarrett (formerly Zepz) joined as Global Head of Banking and Rob Whittick
(formerly NatWest Bank) joined as our new Chief Financial Officer. I am
excited to see what the combination of existing Boku leadership talent and our
new executives will deliver as we grow.
Outlook for the year
We reiterate our expectation that 2024 will be a year of solid top line growth
that is in turn funding an increase in investment - with Adjusted EBITDA
margins staying broadly flat on 2023. We remain confident that we will
achieve expectations for the full year.
Once again, I would like to offer a huge note of thanks to the 452 Boku
colleagues around the world, whose incredible talent and energy have helped to
deliver these results and provide a springboard for what's to come.
Stuart Neal
Chief Executive Officer
24 September 2024
(1) Boku & Juniper Research, 2024. 2024 Global Ecommerce Report. Available
at: https://www.boku.com/boku-knows/2024-boku-global-ecommerce-report
(https://www.boku.com/boku-knows/2024-boku-global-ecommerce-report) .
CHIEF FINANCIAL OFFICER'S REPORT
Introduction and thank you
I am pleased to present my first interim report as CFO of Boku. Since my
arrival in July, I have been warmly welcomed by colleagues across the company.
My particular thanks to Keith for ensuring a smooth transition.
I have been thoroughly impressed by the dedication, talent, and innovative
spirit that defines the Boku team. Our global payments platform is market
leading in the DCB and other LPM arenas with an impressive list of merchants
and an extensive, growing network of issuers across the world.
As we look forward, I am excited about the future of Boku. Together, we will
continue to build on our successes, leveraging our strengths to drive
sustainable growth for our customers and long-term value for our shareholders.
We aim to become the world's best network for localised payment methods, and I
am delighted to be part of that journey. With over 25 years of experience in
the financial services sector, I look forward to contributing to our shared
vision and helping steer the company towards new and ambitious goals.
A summary of our financial and operational highlights for the six months to 30
June 2024 are set out below:
Financial Highlights H1 2024 H1 2023(2) % change
$'000 $'000
Revenue 47,284 38,174 24%(3)
of which
DCB 35,392 30,921 14%
Other LPMs 11,892 7,253 64%
Adjusted EBITDA(4) 14,213 12,081 18%
Adjusted Operating Expenses(5) 31,706 24,777 28%
Adjusted EBITDA Margin(6) 30.1% 31.6% -
Operating (Loss)/ Profit (396) 2,107 -
Cash Balances 148,500 113,866 30%
Average Daily Cash Balances in June 138,610 105,777 31%
Own cash(7) 75,206 54,434 38%
Operational Highlights H1 2024 H1 2023 % change
Total Payment Volumes (TPV) $5.8bn $5.0bn 16%(8)
Take Rates 0.81% 0.76% 7%
Monthly Active Users (MAU) in June 79.6m 61.2m 30%
New users in the six months to June 39.9m 32.7m 22%
(2) The prior period to 30 June 2023 has been restated to exclude the fair
value gain on warrants from administrative expenses, further details can be
found in note 2. Additionally, right-of use assets have been restated,
resulting in a reduction in depreciation, further details can be found on
pages 18 to 19.
(3) 30% on a constant exchange rate basis
(4) Adjusted EBITDA is a non-IFRS measure defined as earnings before interest,
tax, depreciation, amortisation, non-recurring income, share-based payment
expense, foreign exchange gains/ (losses) and exceptional items (see pages 18
to 19 for further details).
(5) Defined as gross profit less Adjusted EBITDA.
(6) Calculated as Adjusted EBITDA over revenue for the period.
(7) Own cash is a non-IFRS measure calculated as cash held plus amounts due
from issuers less amounts owed to merchants
(8) 26% on a constant exchange rate basis
Comments on overall performance
Our growth remains positive, with revenue increasing by 24% to $47.3m (30% on
a constant exchange rate basis) over the first six months of the year (H1
2023: $38.2m). Building on the momentum from last year, we achieved meaningful
revenue growth from other LPMs which now accounts for 25% of total revenues.
This was underpinned by our strategic initiatives focused on enhancing and
expanding our product offering in this area. Our DCB product also continues to
perform well reporting double digit growth in the period. Despite investment
we have increased our Adjusted EBITDA by 18% to $14.2m (H1 2023: $12.1m) and
maintained an Adjusted EBITDA margin of greater than 30% underscoring our
efficient operational management and cost-control measures.
The growth trajectory is maintained
Supporting our customers has always been the cornerstone to Boku's growth
story. By continuously enhancing our offering we have not only retained our
loyal customer base but also attracted new customers in new markets. This is
reflected in our revenue growth of 24% (30% on a constant exchange rate basis)
which has been primarily driven by a 16% increase in TPV (26% on a constant
exchange rate basis) to $5.8bn (H1 2023: $5bn).
The increased TPV is underpinned by a 30% increase in MAU to 79.6m in June
2024 (H1 2023: 61.2m), together with adding 39.9m new users in the six-month
period (H1 2023: 32.7m), reflecting our continued efforts in adding new
connections for our global merchants across existing and new markets. We
completed over 50 new launches in multiple jurisdictions across all LPMs -
DCB, digital wallets and A2A in H1 2024 with both new and existing merchants
including Netflix, Sony and Google.
A significant portion of our revenue growth came from other LPMs - digital
wallets and A2A - where revenue increased by 64% to $11.9m. This was supported
by increases in new users of 46% to 9.2m and increased MAU of 86% to 8.8m
across these other LPMs.
Our take rate has also increased to 0.81% in the six months to 30 June 2024
(from 0.76% H1 2023) which was largely due to higher take rates in other LPM
products - specifically digital wallets.
Looking ahead, our growth trajectory remains positive and promising. The
expanding addressable market together with our relentless focus on meeting
customer needs through innovation and operational excellence will continue to
drive us forward.
Investment continues while maintaining Adjusted EBITDA margin
To support and sustain our growth, we are committed to continued investment
while maintaining an Adjusted EBITDA margin of over 30%. Consequently, while
our Adjusted operating expenditure has increased by 28% to $31.7m (H1 2023:
$24.8m) our Adjusted EBITDA increased by 18% to $14.2m (H1 2023 $12.1m),
resulting in an Adjusted EBITDA margin of 30.1% (H1 2023: 31.6%).
As noted by Stuart above, our investment strategy is centred on both enhancing
our product offering and strengthening our delivery capability to make it
scalable for the future. This approach ensures that we can drive innovation
and expansion, allowing us to capitalise on growth opportunities while
maintaining strong financial performance.
Review of operating expenses and other items
Boku reported a small operating loss of $0.4m for the first six months of 2024
compared to an operating profit of $2.1m in the previous half year. Key items
contributing to this loss are as follows:
· Depreciation and Amortisation charges have increased to $3.8m from $3m in H1
2023 due to the accelerated decommissioning of a legacy platform related to a
prior acquisition.
· Share-based payment charges have increased to $5.8m from $4m in H1 2023
primarily due to the increased number of share awards granted and an increase
in our share price. Boku has a policy of making annual RSU awards to all staff
which vest in full over 3 years. These share awards are satisfied from
treasury stock as part of our share buyback programme which is discussed in
more detail below.
· Foreign exchange losses of $4.8m were reported in the period compared to
losses of $3.1m in H1 2023. This is largely driven by losses on the
revaluation of non-USD balances during the period.
Other notable items below the operating loss line are as follows:
· A fair value loss on the Amazon warrants of $3.3m was reported in the period
compared to a fair value gain of $0.02m in H1 2023 reflecting increases in our
share price. See note 8 for further detail.
· Interest income has increased to $1.6m from $0.5m in H1 2023 as more funds
were moved to longer term deposits.
The Group reported a Basic loss per share of $(0.0036) (H1 2023: EPS
$0.0060).
Ongoing cash generation continues to strengthen our balance sheet
Cash Generation
Boku continues to operate debt-free and generate positive cash flows. As at 30
June 2024 the group held cash balances of $148.5m which was up 30% from
$113.9m in H1 2023 (FY 2023: $150.9m) and average daily cash balances in June
of $138.6m which were up 31% from $105.8m in June 2023 (December 2023:
$131.7m). At 30 June 2024, $75.2m is Boku's 'own' cash which was up 38% from
$54.4m in H1 2023 (FY 2023: $70.4m). It is encouraging to see the business
enhancing its cash generating capabilities which will allow us to make the
necessary investments to drive future growth as noted above.
The 30 June 2024 cash balance includes $3m of cash received from Danal
relating to the exercise of warrants granted upon acquisition of Danal. See
note 8 for further details.
Share Buyback
The cash balance above is stated after the purchase of 700,000 of Boku's own
shares in the first six months of 2024 for a total consideration of $1.6m as
part of its share buyback programme. As explained in Note 10, this programme
has now expired.
Intangibles
As at 30 June 2024, the Group had goodwill of $41.8m (FY 2023: $42.2m) and
other intangibles of $14.8m (FY 2023: $14.4m). As at 30 June 2024, no
impairment was required.
Deferred Tax Asset
Our deferred tax asset increased to $17.7m from $15.3m as at 31 December 2023.
This is primarily due to recognition of previously unrecognised tax losses.
Principal Risks and Uncertainties
For the six months to 30 June 2024, the principal risks and uncertainties of
the Group remain consistent with those previously reported in the Annual
Report and Accounts for the year-ended 31 December 2023. For more details on
the Group's risk management, please refer to the 'Principal Risks and
Uncertainties' section on pages 16 to 20 of the Annual report.
Going Concern
The Group has undertaken a detailed going concern assessment, reviewing its
current and projected financial performance and position, including forecast
cash flows. The Directors are satisfied that the Group has sufficient cash
resources over the period of at least 12 months from the date of approval of
the condensed consolidated financial statements. As such, the condensed
consolidated interim financial statements have been prepared on a going
concern basis.
Looking forward
As I look ahead, our investment narrative remains clear. We anticipate
continued volume increases as we tap into an expanding addressable market. Our
commitment to supporting merchant growth will drive our ongoing investment in
our products, while we also enhance our delivery capability to ensure
scalability. Our goal is to be the leading network for localised payment
methods globally and I am confident we can meet that ambition.
Robert Whittick
Chief Financial Officer
24 September 2024
Cautionary Statement
Boku has made forward-looking statements in this financial information,
including statements about the market and benefits of its products and
services; financial results; product development plans; the potential benefits
of business relationships with third parties and business strategies. The
Group considers any statements that are not historical facts as
"forward-looking statements". They relate to events and trends that are
subject to risk and uncertainty that may cause actual results and the
financial performance of the Group to differ materially from those contained
in any forward-looking statement. These statements are made by the Directors
in good faith based on the information available to them and such statements
should be treated with caution due to the inherent uncertainties, including
both economic and business risk factors underlying any such forward-looking
information.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited*
Six months ended Six months ended
30 June 2024 30 June 2023
Note $'000 $'000
Revenue 5 47,284 38,174
Cost of providing services (1,365) (1,316)
Gross profit 45,919 36,858
Administrative expenses (46,315) (34,854)
Other income - 103
Operating (loss)/ profit (396) 2,107
Fair value (loss)/ gain on warrants 8 (3,279) 18
Finance income 6 1,637 474
Finance expense 6 (115) (150)
(Loss)/ profit before tax (2,153) 2,449
Income tax benefit/ (expense) 1,084 (649)
(Loss)/ profit for the period (1,069) 1,800
(all attributable to equity holders of the parent)
Other comprehensive income
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations (1,063) 1,141
Other comprehensive (loss)/ income for the period, net of tax (1,063) 1,141
Total comprehensive (loss)/ income for the period (2,132) 2,941
(all attributable to equity holders of the parent)
Earnings per share for loss/profit attributable to equity holders of the USD USD
parent
Basic (loss)/ earnings per share (0.0036) 0.0060
Diluted (loss) / earnings per share (0.0036) 0.0055
Alternative performance measures restated*
Adjusted EBITDA(1) 14,213 12,081
(*)The prior period to 30 June 2023 has been restated to exclude the fair
value gain on warrants from administrative expenses. Further details can be
found in note 2.
(1)Adjusted EBITDA is a non-IFRS measure defined as earnings before interest,
tax, depreciation, amortisation, non-recurring income, share-based payment
expense, foreign exchange gains/ (losses) and exceptional items (see pages 18
to 19 for further details).
The accompanying notes form an integral part of these condensed consolidated
financial statements.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Audited
30 June 2024 31 December 2023
Note $'000 $'000
Assets
Non-current assets
Property, plant and equipment 771 758
Right-of-use assets 3,232 2,784
Intangible assets 56,645 56,620
Warrant contract assets 8 1,954 1,840
Deferred tax assets 17,660 15,306
Total non-current assets 80,262 77,308
Current assets
Trade and other receivables 139,016 148,522
Warrant contract assets 226 122
Cash and cash equivalents 7 148,500 150,859
Total current assets 287,742 299,503
Total assets 368,004 376,811
Current liabilities
Trade and other payables 214,509 233,049
Current tax payable 778 509
Current lease liabilities 1,362 1,370
Total current liabilities 216,649 234,928
Non-current liabilities
Other payables 1,537 979
Deferred tax liabilities 126 182
Warrant liabilities 8 9,089 5,511
Non-current lease liabilities 2,173 1,682
Total non-current liabilities 12,925 8,354
Total liabilities 229,574 243,282
Net assets 138,430 133,529
Equity
Share capital 10 29 29
Other reserves 256,895 255,249
Foreign currency translation reserve (5,781) (4,718)
Treasury reserve 10 (2,018) (6,628)
Retained losses (110,695) (110,403)
Total equity 138,430 133,529
(all attributable to equity holders of the parent)
The accompanying notes form an integral part of these condensed consolidated
financial statements.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share capital Other reserves Foreign currency translation reserve Treasury shares reserve Accumulated losses Total
$'000 $'000 $'000 $'001 $'000 $'000
Balance at 1 January 2023 29 252,385 (6,290) (1,835) (120,713) 123,576
Profit for the period - - - - 1,800 1,800
Other comprehensive income - - 1,141 - - 1,141
Total comprehensive income for the period - - 1,141 - 1,800 2,941
(all attributable to equity holders of the parent company)
Transactions with owners in their capacity as owners
Loss on treasury shares - - - 269 (269) -
Issue of share capital upon exercise of stock options and RSUs - 40 - - - 40
Share-based payments expense - 3,559 - - - 3,559
Taxation adjustment on share-based payments - - - - (55) (55)
Acquisition of treasury shares - - (5,460) - (5,460)
Issue of treasury shares to employees - (5,008) - 5,008 - -
Balance at 30 June 2023 29 250,976 (5,149) (2,018) (119,237) 124,601
Balance at 1 January 2024 29 255,249 (4,718) (6,628) (110,403) 133,529
Loss for the period - - - - (1,069) (1,069)
Other comprehensive loss - - (1,063) - - (1,063)
Total comprehensive loss for the period - - (1,063) - (1,069) (2,132)
(all attributable to equity holders of the parent company)
Transactions with owners in their capacity as owners
Issue of share capital - 3,000 - - - 3,000
Issue of share capital upon exercise of stock options - 428 - - - 428
Share-based payments expense - 4,412 - - - 4,412
Taxation adjustment on share-based payments - - - - 777 777
Acquisition of treasury shares - - - (1,584) - (1,584)
Issue of treasury shares to employees - (6,194) - 6,194 - -
Balance at 30 June 2024 29 256,895 (5,781) (2,018) (110,695) 138,430
The accompanying notes form an integral part of these condensed consolidated
financial statements.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited Unaudited
Six months ended Six months ended
30 June 2024 30 June 2023
Note $'000 $'000
Operating activities
(Loss)/ profit after tax (1,069) 1,800
Adjustments:
Income tax (benefit)/expense (1,084) 649
Amortisation of intangible assets 2,802 2,061
Depreciation of property, plant and equipment 987 1,041
Loss on disposal of property, plant and equipment - 2
Fair value adjustment on warrant valuations 3,279 (18)
Amortisation of warrant assets 81 76
Finance income and expenses 6 (1,522) (324)
Foreign exchange loss/ (gain) (unrealised) 1,535 (707)
Share-based payments expense 4,413 3,559
Operating gain before working capital changes 9,422 8,139
Decrease\(increase) in trade and other receivables 8,009 (3,012)
(Decrease) in trade and other payables (15,680) (2,892)
Cash generated from operations 1,751 2,235
Income taxes paid (159) (118)
Net cash from operating activities 1,592 2,117
Investing activities
Purchase of property, plant and equipment (267) (133)
Payments for internally developed software (3,461) (2,617)
Interest received 6 1,637 474
Net cash used in investing activities (2,091) (2,276)
Financing activities
Principal elements of lease payments (750) (625)
Interest paid 6 (115) (150)
Proceeds on Issue of shares 8 3,000 -
Issue of share capital on exercise of options & RSUs 428 40
Acquisition of treasury shares (1,584) (5,460)
Proceeds on sale of treasury shares - 2,333
Net cash from/ (used in) financing activities 979 (3,862)
Net increase/ (decrease) in cash and cash equivalents 480 (4,021)
Effect of foreign exchange rate changes on cash and cash equivalents (2,839) 1,374
Cash and cash equivalents at beginning of period 150,859 116,513
Cash and cash equivalents at end of period 7 148,500 113,866
The accompanying notes form an integral part of these condensed consolidated
financial statements.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. General information
Boku, Inc., a public limited company, incorporated and domiciled in the United
States of America, is the parent company (Parent Company or Parent) for all of
its subsidiaries (together Boku or the Group). The shares of the Company are
quoted on AIM, a market of the London Stock Exchange Group plc. The registered
office of the Company is 660 Market Street, Suite 400, San Francisco, CA
94104, United States.
The principal activity of the Group is the provision of digital payments,
including mobile wallets, real-time payment schemes, and direct carrier
billing for global merchants. These solutions enable merchants to acquire new
customers and accept online payments from customers who prefer to pay without
credit cards.
The condensed consolidated financial statements were approved for issue on 23
September 2024.
2. Basis of preparation
The annual financial statements of the Group will be prepared in accordance
with International Financial Reporting Standards ("IFRS") as issued by the
International Accounting Standards Board ("IASB"). The condensed consolidated
financial statements included in this interim report are for the six months
ended 30 June 2024 and have been prepared in accordance with International
Accounting Standard 34 Interim Financial Reporting ("IAS 34"). The condensed
consolidated financial statements have been independently reviewed, not
audited.
The disclosures in these condensed consolidated financial statements do not
include the information reported for full annual financial statements and
should therefore be read in conjunction with the annual financial statements
of the Group for the year ended 31 December 2023. Comparative condensed
consolidated statement of financial position is extracted from annual
financial statements as at 31 December 2023 whereas comparative condensed
consolidated statement of comprehensive income, consolidated condensed
statement of changes in equity and condensed consolidated statement of cash
flows are extracted from un-audited condensed consolidated financial
statements of the Group for the six-month period ended 30 June 2023.
In the six months ended 30 June 2024 the Group did not adopt any new standards
or amendments issued by the IASB or interpretations by the IFRS
Interpretations Committee ("IFRIC") that would have had a material impact on
the condensed consolidated financial statements.
2.1 Going concern
The Group meets its day-to-day working capital requirements through its own
cash balances. The Group has undertaken a detailed going concern assessment,
reviewing its current and projected financial performance and position,
including forecast cash flows. The downside scenario considered revenue
falling between 31% and 55%. The downside scenario, outlining the impact of a
severe but plausible adverse case, shows that there is sufficient headroom for
liquidity for at least the next 12 months from the date of approval of these
condensed interim financial statements. Thus, the directors are satisfied that
the Group has sufficient resources to continue in operation for the
foreseeable future and meet its financial obligations as they fall due for a
period of not less than 12 months from the date of approving this interim
report. Accordingly, the Directors continue to adopt the going concern basis
in preparing the condensed consolidated financial statements.
2.2 Alternative performance measures (APMs)/ Non-GAAP measures
Management regularly uses APMs internally to understand, manage and evaluate
the business performance and make operating decisions. These measures are
among the primary factors management uses in planning for and forecasting
future periods. The primary APMs are EBITDA, Adjusted EBITDA, Adjusted
Operating expenses and Constant exchange rate revenues which management
considers are relevant in understanding the Group's financial performance.
Further information about these APMs together with a reconciliation to
operating profit are disclosed at the end of this report.
2.3 Restatement
The condensed consolidated statement of comprehensive income for the six
months ended 30 June 2023 has been restated to move the fair value gain on
warrants from exceptional items in administrative expenses to a separate line
below operating profit, to more appropriately reflect the accounting
judgement.
This adjustment had no impact on the condensed consolidated statement of cash
flows or condensed consolidated statement of financial position.
Fair value gain on warrants
As originally reported Effect of restatement Group restated amounts
30 June 2023 $'000 $'000 $'000
Condensed consolidated statement of comprehensive income (extract)
Gross profit 36,858 - 36,858
Administrative expenses (34,836) (18) (34,854)
Other Income 103 - 103
Operating profit 2,125 (18) 2,107
Fair value gain on warrants - 18 18
Finance income 474 - 474
Finance expense (150) - (150)
Profit before tax from continuing operations 2,449 - 2,449
2.4 Critical accounting estimates and judgements
The preparation of interim financial statements requires management to make
judgements, estimates and assumptions that affect the application of
accounting policies and the reported amounts of assets and liabilities, income
and expense. Actual results might differ from these estimates. In preparing
these condensed consolidated financial statements, the significant judgements
made by management in applying the Group's accounting policies and the key
sources of estimation uncertainty were the same as those that applied to the
consolidated financial statements for the year ended 31 December 2023, with
the exception of changes in estimates that are required in determining the
recognition of deferred tax assets.
3. Significant Accounting Policies
The accounting policies adopted are consistent with those of the previous
financial year and corresponding interim reporting period.
4. Operating Segments
These condensed consolidated financial statements have been prepared on the
basis of a single reportable segment being the Payments Business.
5. Revenue from contracts with customers
The Group's revenue is principally its service fees earned from its merchants.
All revenue is earned at the time the transaction is processed and, as a
result, all revenue is recognised at that point in time. The geographical
analysis of the revenue by location of the users is presented below:
Group revenue by region Unaudited Unaudited
Six months ended Six months ended
30 June 2024 30 June 2023
$'000 % $'000 %
Americas 1,043 2.2% 1,338 3.5%
APAC 27,999 59.2% 22,429 58.8%
EMEA 18,242 38.6% 14,407 37.7%
Total 47,284 100% 38,174 100%
The amortisation of the warrant contract asset to revenue during the six
months ended June 2024 amounted to $0.08m (H1 2023: $0.08m). See note 8 for
more information on warrants.
6. Finance income and expense
Unaudited Unaudited
Six months ended Six months ended
30 June 2024 30 June 2023
$'000 $'000
Finance income
Interest income 1,637 474
Total finance income 1,637 474
Finance expense
Interest on bank loans/ credit facility (25) (51)
Interest on operating leases (90) (99)
Total finance expense (115) (150)
Net finance income 1,522 324
7. Cash and cash equivalents and restricted cash
Unaudited Audited
30 June 2024 31 December 2023
$'000 $'000
Cash and cash equivalents 123,721 117,360
Restricted cash 24,779 33,499
Total Cash 148,500 150,859
Restricted cash primarily includes money received but not yet paid to
merchants (segregated funds, in transit), for Boku's licenced entities, cash
held in the form of a letter of credit to secure a lease agreement for the
Company's San Francisco office and a certificate of deposit held at a
financial institution to collateralise Company credit cards.
8. Warrants
Amazon Warrants - Derivative Liabilities
On 16 September 2022, the Group entered into a stock warrant agreement with
Amazon in conjunction with a commercial service level agreement for the Group
to provide payment processing services to Amazon. The Group includes a
detailed explanation of the Amazon warrants and its accounting policy for such
warrants in the Group's most recent annual report and has therefore not
replicated those disclosures within these condensed consolidated financial
statements.
The fair value of the warrant liability was $9.1m as at 30 June 2024, and
$5.5m as at 31 December 2023. The increase in fair value from 31 December 2023
to 30 June 2024 was primarily due to an increase in the spot price of shares
on AIM from £1.34 to £1.82 (partially offset by an increase in risk free
rate from 3.81% to 4.25%), combined with an increase in the number of warrants
expected to vest from 5,333,781 to 5,622,828. The fair value of 1 warrant
increased to $1.616 at 30 June 2024 from $1.033 at 31 December 2023. The
increase in the number of warrants expected to vest resulted in an increase to
the contract asset and financial liability of $0.3m. The remaining increase in
the fair value of underlying warrants of $3.3m represented a charge to the
statement of comprehensive income.
The warrants are classified as Level 3 derivative liabilities as there is no
current market for the warrants, such that the determination of fair value
requires significant judgment and estimation. The Group values the warrants
using a combination of Monte Carlo Simulation and Black-Scholes Model
valuation methods. Significant unobservable inputs as at 31 December 2023
included volatility of the Company's common stock of 40%, revenue volatility
of 30%, a risk-free rate of 3.81%, and forecasted revenue from Amazon over the
7-year vesting period. Significant unobservable inputs as at 30 June 2024
included volatility of the Company's common stock of 40%, revenue volatility
of 30%, a risk-free rate of 4.25%, and forecasted revenue from Amazon over the
7-year vesting period.
A significant increase in volatilities in isolation as at 30 June 2024 would
result in a significant change in fair value. If equity volatility and
revenue volatility were both to decrease by 5% to 35% and 25% respectively,
the total fair value of warrants would decrease to $8.8m, representing a
decrease in fair value of $0.2m. If equity volatility and revenue volatility
were both to increase by 5% to 45% and 35% respectively, the total fair value
of warrants would increase to $9.4m, representing an increase in fair value of
$0.3m.
Exercise of other warrants in the period
Danal Company Ltd exercised a total of 1,634,699 warrants, exercisable at
141p, for a total compensation of $3m. As a result, 1,634,699 new common
shares of $0.0001 were issued. The warrants were issued as part of the initial
consideration in respect of the Company's acquisition of Danal, Inc, announced
on 6 December 2018 and completed on 1 January 2019.
9. Dividends
No interim dividend has been paid or proposed in respect of the current
financial period (H1 2023: nil).
10. Share Capital
At 30 June 2024, Boku, Inc. had 303,028,613 (FY23: 301,066,914) common shares
issued and fully paid. Boku, Inc. has only one class of shares with par value
of $0.0001 each. The authorised share capital is 500,000,000 shares. Boku,
Inc. holds 747,451 shares in treasury (FY23: 4,007,868 shares). During the
year the Boku, Inc. purchased back 700,000 shares under the Share buyback
programme. The programme was extended on 8 June 2023 and expired on 30 June
2024.
11. Contingent liabilities
The Group does not believe it has any potential liabilities or obligations
that would have a material adverse effect on its financial position or results
of operations, including those related to legal disputes, patent claims, or
indemnification agreements.
12. Events after the reporting date
Executive award plan
On 11 September, the shareholders approved the adoption of the new stretch
restricted share unit plan. This plan will support and reward the performance
of the executive management team of the company in a fair, transparent and
proportionate manner. The awards granted under new share scheme will be RSUs.
The aggregate number of shares that will be allocated under the new plan will
not exceed 3% of issued share capital as at 31 July 2024.
All awards are subject to the same performance condition being a comparison of
the 40-day Volume-Weighted Average Price ("VWAP") following the release of the
results announcement for the 2027 financial year (expected to be released
in March 2028) (the "Tested Share Price") against 180.4p (being the 40-day
VWAP following the release of the results announcement for the 2023 financial
year on 19 March 2024) ("Base Share Price") as follows:
· no Awards will vest if the Tested Share price is less than 3x the Base Share
Price;
· 25% of the Awards vest if the Tested Share Price is 3x the Base Share Price;
· 100% of the Awards vest if the Tested Share Price is 5x the Base Share Price;
and
· if the Tested Share Price is between 3x and 5x the Base Share Price, the
Awards vest on a straight-line basis from 25% to 100%. For example, if the
Tested Share Price is 4x the Base Share Price, 62.5% of the Awards will vest.
Credit facility
The $10m revolving credit facility, previously available to the Group, expired
on 17 September 2024 and was not renewed. This facility remained undrawn
throughout the period.
NON-IFRS FINANCIAL INFORMATION
Management regularly uses APMs internally to understand, manage and evaluate
the business performance and make operating decisions. These measures are
among the primary factors management uses in planning for and forecasting
future periods.
Management present APMs because they believe that these and other similar
measures are widely used by certain investors, securities analysts and other
interested parties as supplemental measures of performance and liquidity. It
is believed these APMs depict the true performance of the business by
encompassing only relevant and controllable events, allowing management to
evaluate and plan more effectively for the future.
The primary APMs are EBITDA, Adjusted EBITDA and Adjusted Operating expenses,
and Constant exchange rate which management considers are relevant in
understanding the Group's financial performance. Management calculates APMs by
excluding certain non-cash and one-off items from the actual results. The
determination of whether non-cash items or one-off items should be excluded,
is a matter of judgement and is based on whether the inclusion/exclusion from
the results represent more closely the consistent trading performance of the
business.
The Group uses the following APMs
APM Definition and purpose
EBITDA Calculated as net income/ (loss) for the year, less discontinued operations
gains, net of tax, before finance expenses (including finance costs related to
lease liabilities), depreciation and amortisation (including depreciation of
right-of-use assets), and income tax expense/ (benefit).
Adjusted EBITDA Defined as earnings before interest, tax, depreciation and amortisation,
non-recurring other income, share-based payments expense, foreign exchange
losses and exceptional items. Adjusted EBITDA is used internally to establish
forecasts, budgets and operational goals to manage and monitor our business,
as well as evaluate our underlying historical performance. We believe that
Adjusted EBITDA is a meaningful indicator of the health of our business as it
reflects our ability to generate cash that can be used to fund recurring
capital expenditures and growth. Adjusted EBITDA from continuing operations
also disregards non-cash or non-recurring charges (exceptional items) that we
believe are not reflective of our long-term performance. We also believe that
Adjusted EBITDA is widely used by investors, securities analysts and other
interested parties as a supplemental measure of performance and liquidity.
Adjusted operating expenses Defined as gross profit less Adjusted EBITDA.
Adjusted EBITDA margin Calculated as Adjusted EBITDA over revenue for the period.
Constant exchange rate measures (revenue only) Calculated by applying the monthly average foreign exchange rates for each
month of 2023 to the actual 2024 monthly results.
Own cash Calculated as cash held plus amounts due from issuers less amounts owed to
merchants
A reconciliation of Adjusted EBTIDA to operating (loss)/ profit is as follows:
Unaudited Unaudited*
Six months ended Six months ended
30 June 2024 30 June 2023
$'000 $'000
Adjusted EBITDA 14,213 12,081
Other income adjustment (non-recurring) - 103
Depreciation and amortisation (3,789) (2,967)
Share-based payment expense (5,821) (3,978)
Foreign exchange loss (4,833) (3,132)
Exceptional items (included in administrative expenses) (166) -
Operating (loss)/ profit (396) 2,107
(*)The prior period to 30 June 2023 has been restated to exclude the fair
value gain on warrants from administrative expenses. Additionally,
right-of-use assets have been restated resulting in a reduction in
depreciation, further details are set out below.
Restatement of APMs:
Amounts previously accounted for under IFRS 16 as right-of-use assets were
restated to prepayments in the condensed consolidated statement of financial
position. The impact on Adjusted EBITDA as a result of the related reduction
in depreciation for the six months ended 30 June 2023 is shown below.
As originally reported Effect of restatement Group restated amounts
30 June 2023 $'000 $'000 $'000
Alternative performance measures (extract)
Depreciation and amortisation (3,102) 135 (2,967)
Adjusted EBITDA 12,216 (135) 12,081
Adjusted EBTIDA margin 32% 31.6%
Adjusted operating expenses 24,642 135 24,777
INDEPENDENT REVIEW REPORT
Report on the condensed consolidated interim financial statements
Our conclusion
We have reviewed Boku, Inc.'s condensed consolidated interim financial
statements (the "interim financial statements") in the Interim Report 2024 of
Boku, Inc. for the 6 month period ended 30 June 2024 (the "period").
Based on our review, nothing has come to our attention that causes us to
believe that the interim financial statements are not prepared, in all
material respects, in accordance with International Accounting Standard 34,
'Interim Financial Reporting', as issued by the IASB and the AIM Rules for
Companies.
The interim financial statements comprise:
· the Condensed Consolidated Statement of Financial Position as at
30 June 2024;
· the Condensed Consolidated Statement of Comprehensive Income for the
period then ended;
· the Condensed Consolidated Statement of Cash Flows for the period
then ended;
· the Condensed Consolidated Statement of Changes in Equity for the
period then ended; and
· the explanatory notes to the interim financial statements.
The interim financial statements included in the Interim Report 2024 of Boku,
Inc. have been prepared in accordance with International Accounting Standard
34, 'Interim Financial Reporting', as issued by the IASB and the AIM Rules for
Companies.
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, 'Review of Interim Financial Information Performed by
the Independent Auditor of the Entity' issued by the Financial Reporting
Council for use in the United Kingdom ("ISRE (UK) 2410"). A review of interim
financial information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and, consequently, does not
enable us to obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not express
an audit opinion.
We have read the other information contained in the Interim Report 2024 and
considered whether it contains any apparent misstatements or material
inconsistencies with the information in the interim financial statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on the review
procedures performed in accordance with ISRE (UK) 2410. However, future events
or conditions may cause the group to cease to continue as a going concern.
Responsibilities for the interim financial statements and the review
Our responsibilities and those of the directors
The Interim Report 2024, including the interim financial statements, is the
responsibility of, and has been approved by the directors. The directors are
responsible for preparing the Interim Report 2024 in accordance with the AIM
Rules for Companies which require that the financial information must be
presented and prepared in a form consistent with that which will be adopted in
the company's annual financial statements. In preparing the Interim Report
2024, including the interim financial statements, the directors are
responsible for assessing the group's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to
liquidate the group or to cease operations, or have no realistic alternative
but to do so.
Our responsibility is to express a conclusion on the interim financial
statements in the Interim Report 2024 based on our review. Our conclusion,
including our Conclusions relating to going concern, is based on procedures
that are less extensive than audit procedures, as described in the Basis for
conclusion paragraph of this report. This report, including the conclusion,
has been prepared for and only for the company for the purpose of complying
with the AIM Rules for Companies and for no other purpose. We do not, in
giving this conclusion, accept or assume responsibility for any other purpose
or to any other person to whom this report is shown or into whose hands it may
come save where expressly agreed by our prior consent in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
London
24 September 2024
Glossary
Abbreviation Definition
A2A Account to Account based payment systems allow payments to be made from one
bank account to another, generally in real time. They are contrasted with
card-based payment systems where the payment is mediated through a card
scheme. In A2As the payment is direct. A2A payments can be organised as
schemes, typically under the jurisdiction of the Central Bank (UPI in India or
Pix in Brazil), as interbank initiatives (Twint in Switzerland, Blik in
Poland) or as infrastructure (Open Banking access to Faster Payments in the
UK).
AGM Annual General Meeting
AIM Alternative Investment Market
AISP Under Open Banking, an Account Information Service Provider, with consumer
consent can access information about the transactions and balances in the
consumer's bank account. AISPs can then provide services that provide a
consolidated view of a consumer's activity across multiple banks, or analysis
that might not be available from their financial institution. In the UK, AISPs
are authorised by the FCA.
APMs Alternative performance measures are non-GAAP financial measures used by
management to assess and monitor the performance of the business.
ATV The Average Transaction value is the TPV divided by the total number of
successful transactions.
Bundling The distribution of a digital entertainment company's services through a 3rd
party such as a Telco, TV company, Bank or retailer, typically as part of a
new tariff (e.g. "Get 6 month's streaming music as part of your mobile phone
service"). Boku's services link the distributor and the entertainment
company's systems.
Carriers Carriers are the consumers phone company where purchases can be charged to a
phone bill, see DCB.
Constant exchange rate Constant exchange rate is calculated by applying the monthly average foreign
exchange rates in 2023 to the actual 2024 results.
CEO Chief Executive Officer
CFO Chief Finance Officer
CGU Cash generating unit
COO Chief Operating Officer
CT Corporation tax
DCB Direct Carrier Billing is a form of payment method whereby consumers can
purchase digital goods using their post-paid mobile phone account or pre-paid
mobile phone balance.
DEI Diversity, equity and inclusion
DT Deferred tax
EGM Extraordinary General Meeting
EPS Earnings per share
eWallet/ digit wallet An eWallet is a type of payment method that allows a user to undertake
transactions online and, sometimes, offline. A user will link their eWallet to
a funding source which might be a bank account, debit card or cash top up. The
balance in the wallet is then used to fund the purchase. In some cases,
eWallets will have an auto top up feature that allows funds to be withdrawn
from the funding source if there is insufficient balance. Examples include
Alipay, PayPal, Dana or Gopay.
GLT Global Leadership Team
Gross margin The difference between revenue and cost of sales divided by revenue
Group Boku, Inc. and its controlled entities
IFRS International Financial Reporting Standards
Issuer The Issuer is the entity within the Boku system who has the relationship with
the consumer, issues them with payment credentials, collects the amounts owed
by the consumer and settles them. The Issuers within the Boku network include
Mobile Network Operators, eWallet providers and A2A schemes.
LPMs Local Payment Methods are those which typically operate in a single country.
They embrace domestic card schemes, domestic voucher schemes, mobile network
operators, eWallets, Account to Account based payment systems and Buy Now Pay
Later operators. Local Payment schemes typically operate to their own standard
and are not interoperable with other schemes.
LTIP Long term incentive plan
MAU Boku defines a Monthly Active User as one who has undertaken one or more
successful payment transactions or who has an active bundle within the month
in question. Users who have registered and still have an active payment method
on file are not defined as active unless they have successfully transacted
Merchant The merchant is the party in the system who wishes to sell products or
services to consumers and needs to support various payment methods in order to
collect the money.
MNOs Mobile network operator, see carrier.
Nomad Nominated adviser
NPV Net present value
Open Banking In Open Banking markets, banks are required to provide interfaces to
authorised 3(rd) parties to access account information (AISP) or initiate
payments (PISP)
PISP Under Open Banking, a Payment Initiation Service Provider, with consumer
consent, can initiate payments from the consumer's bank account. In the UK,
PISPs are authorised by the FCA.
Platform The platform that Boku have built to connect Merchants and local payment
methods.
PPA Price purchase allocation
PSP A Payment Service Provider acts as a technical layer connecting a merchant to
various issuers. The base level of service is the transaction model where only
technical services are provided. It can be supplemented by the settlement
model whereby funds are collected and settled to those merchants.
PwC PricewaterhouseCoopers LLP
RCF Revolving credit facility
RSU Restricted Stock Units are share awards subject to a vesting schedule and
certain vesting conditions.
Settlement Model In the Settlement model, Boku provides not only technical transaction
processing services but also collects the funds due from the Issuers and
settles them to the merchant in the currency of their choice.
SID Senior Independent Director
SMS aggregator Company used by Boku used to purchase SMS messages in bulk.
Take Rate Take rate is defined as revenue divided by TPV. It is a measure of the average
price obtained.
TPV Total Payment Volume is total value transacted through the system quantified
in US dollars. For payments, this is the total amount successfully transacted
by consumers translated into USD at average FX rates for the month. For
bundling transactions, it represents the total retail value of the bundles. In
some cases, this value is inferred from revenue.
Transaction model The Transaction Model is when Boku provides solely technical connectivity
services to a merchant who arranges for settlement directly with the issuer.
WACC Weighted average cost of capital
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