Edison Investment Research - Optimal Payments (OPAY) Update: Trading in line

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Edison Investment Research

Update: Trading in line

Optimal expects to report FY14 revenues and EBITDA in line with market expectations; lower than expected tax should result in earnings materially above market expectations. The underlying business continues to perform well, bolstered by the US STP acquisitions in July, providing strong foundations for growth in FY15 and beyond. The stock trades at a discount to peers despite strong forecast revenue and earnings growth.

15/01/2015 3 EN

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Optimal Payments

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Isle of Man

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Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Edison Investment Research

Outlook: Focus shifts to integration

H115 results confirm that business continues to be strong, and with the Skrill acquisition complete, the focus shifts to execution of targeted cost synergies and exploitation of the groupâ€™s broader reach. With a more balanced geographical and customer mix and operating in a structural growth industry, key to Optimalâ€™s success will be the ability to develop innovative services to keep ahead of larger payment industry peers.

September 24, 2015 September 24, 2015 12 EN

Edison Investment Research

Flash note: H115 trading in line; acquisition on track

Optimal has confirmed that trading in H115 was strong and in line with expectations. Depending on the timing of regulatory approvals, the Skrill acquisition is likely to complete at end July/early August. On our illustrative estimates for the combined Optimal/Skrill business, the stock is trading on a FY16e P/E of only 10.7x, at a significant discount to its peer group. We would expect this discount to start to close on completion of the deal and as Optimal moves to a main market listing, and ultimately FTSE 250 inclusion.

July 3, 2015 July 3, 2015 2 EN

Edison Investment Research

Update: Skrill completion moves a step closer

Optimal has raised proceeds of Â£452m from the rights issue. The Skrill acquisition is on track, with completion expected in early Q315, and we believe there is a strong likelihood of the stock joining the FTSE 250 later in Q3. On initial calculations, the combined group looks set to grow revenues to $800m and EBITDA margins to 30% by FY16 as cost synergies are realised. The stock is trading at a discount to peers based on our initial illustrative estimates for FY16.

May 5, 2015 May 5, 2015 6 EN

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Update: Trading in line

Outlook: Focus shifts to integration

Flash note: H115 trading in line; acquisition on track

Update: Skrill completion moves a step closer

Manx Financial Group - Termination of coverage

musicMagpie - Termination of coverage

Topps Tiles - Accelerating growth through Q125

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