The Tyro Payments Ltd (ASX: TYR) share price was out of form on Tuesday and dropped lower with the rest of the market.
The payments company's shares ended the day 2.5% lower at $3.72.
Why did the Tyro share price drop lower?
Although Tyro released its annual general meeting update today, I suspect this decline had less to do with that and more to do with a selloff of tech shares.
After all, the S&P/ASX All Technology Index (ASX: XTX) dropped a sizeable 2.8% today, compared to a 1.7% decline by the benchmark ASX 200.
What about Tyro's update?
Tyro's update revealed that its solid growth has continued in FY 2021 despite the pandemic.
According to the release, the company's Payments business has maintained its merchant acquisition momentum with 33,200+ merchants on its platform at 30 September 2020. This is up 8% on the prior corresponding period.
In addition to this, despite lockdowns and restrictions, the company has delivered growth in transaction value year to date.
As of 23 October, Tyro's transaction value stood at $6.8 billion, up 5% on the same period last year. Impressively, that's despite the company recording a 34.5% decline in transaction value in Victoria over the period.
Finally, the company recorded eCommerce transaction value of $6.7 million for the first quarter.
Over in the Banking business, things have been a bit quieter. Loan originations to 30 September 2020 were just $0.9 million, down a massive 95% on the prior corresponding period. Deposit balances stood at $76.6 million at the end of the quarter.
Outlook.
Due to the uncertain environment, the company isn't providing any specific profit guidance for FY 2021.
However, management did speak about the future and particularly its recent alliance with Bendigo and Adelaide Bank Ltd (ASX: BEN).
It commented: "We expect to deploy more than 26,000 Tyro terminals in calendar 2021 for the alliance, increasing our terminal fleet to just above 89,000 terminals."
"It is our expectation that Bendigo Bank's business customers will generate approximately $5 billion in transaction value in FY22. Our gross profit share (after gross profit share to Bendigo Bank and before operating costs) from the Bendigo Bank cohort will be approximately $19 million in FY22," management added.
