Forex specialist OFX confident of strong finish to 2023

Australian online foreign exchange and payments specialist OFX Group (ASX: OFX) has added to its growing investment portfolio and forecast continued strong upside for its cross-border payments business in FY 2024.

OFX today confirmed it was making a significant investment to add to its B2B client offering with the acquisition of fellow Sydney-based firm, Paytron.

The takeover is for an initial consideration of approximately $6 million in the first year, followed by further cash fundings based on revenue milestones.

Paytron has developed a platform which offers card multi-currency account capabilities. In acquiring 100% of Paytron, OFX will also be bring its team of specialist with a focus on in-house development capabilities.

Growth forecast

In releasing its Annual Report, OFX revealed strong growth forecasts for FY 2024.

It estimated that, excluding any Paytron input, the company is targeting net operating income (NOI) growth of between $225 million and $243 million with an underlying EBITDA of between $63 million and $74 million.

This will include increased input from the company’s March 2022 acquisition of Firma Foreign Exchange Corporation for $98 million.

Strong annual results

OFX reported a 45% increase for NOI of $214.1 million for the 12 months ended 31 March 2023.

The impressive result was driven by revenue growth across all regions.

The annual results also included a record underlying EBITDA of $62.4 million, up 40.3% and an underlying EBITDA margin of 29.2%. Statutory net profit after tax was up 25.6% to $31.4 million.

The company’s corporate segment revenue jumped by 89.4% to $124.6m, 88% of which was recurring.

Share buy-back

Chief executive officer and managing director, Skander Malcolm, also revealed OFX will implement an on-market share buy-back program to acquire up to 10% of its ordinary shares over the next 12 months.

“I am delighted to report a record result for OFX, which demonstrates our successful pivot to B2B, and our ability to grow value from our loyal client base,” Mr Malcolm said.

“We achieved outstanding financial outcomes with NOI and margin growth driving record EBITDA of $62.4m. Our recurring revenues are now 84%, driven by our strong corporate segment, and it was pleasing to see signs of recovery in our high value consumer segment towards the end of the period as interest rate rises begin to stabilise.”

Billions in transactions

Since its formation in 2001, OFX has undertaken transaction for over over million customers in more than 50 currencies and over 170+ countries.

The company estimates it has helped move more than $200 billion in that time.