Why the Tyro Payments (ASX:TYR) share price is shooting higher

The Tyro Payments (ASX:TYR) share price is shooting higher today, up more than 6% in morning trade. We take a look at the company’s results.

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Tyro Payments Ltd (ASX: TYR) shares are shooting higher today after the payment solutions provider released its results for the financial half year ending 31 December (H1 FY21). At the time of writing, the Tyro share price is trading 6.62% higher at $2.90.

What did Tyro Payments report?

The Tyro share price is surging higher in morning trade after the company reported a 13% increase in the number of merchants using its payments solutions. Merchant numbers reached a record high of 36,720 in H1 FY21, up from 32,450 in the first half of the 2020 financial year.

Tyro also revealed it had achieved a new record high in the transactions processed by its merchants, up 10% to $12.1 billion.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) came in at $8.5 million. That’s up 464% from the $1.5 million reported in H1 FY20.

Revenue for the half was $114.8 million, an increase of 2.1% from the previous corresponding period.

Statutory net profit after tax (NPAT) was still negative, but losses narrowed by 82% to $3.4 million, down from $19.2 million in the previous corresponding half.

Commenting on the results, Robbie Cooke Tyro CEO said:

We are proud to have processed a record $12.1 billion in transactions for our merchants. This was achieved despite the continuing challenges from COVID and unpredictable lockdowns. Our merchants saw solid growth in the half, while our market leading solutions continued to attract new merchants to our platform.

Looking ahead, the company remains focused on repairing any lingering damage from its terminal connectivity failures in January this year.

Cooke stated:

Whilst we continue at pace with our planned initiatives to drive growth and build our ecosystem centred around payments and enhanced by value adding features and products, our first priority over the next six months is to do all that we can to rebuild trust with those of our merchants impacted by the terminal connectivity issue triggered on 5 January.

He added:

We are now building a ‘failover’ solution. This will see us provide all our merchants with a dongle solution in combination with their standard terminals as an extra level of redundancy – this is an industry first move.

Tyro share price snapshot

The Tyro share price has yet to fully recover from the heavy hit it endured during the wider COVID-19-driven market rout during February and March last year. Over the past 12 months, Tyro shares are down by nearly 29%. By comparison, the All Ordinaries Index (ASX: XAO) is flat over that same period.

With today’s intraday gains taken into account, year to date, the Tyro share price is down by around 14%.

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Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Tyro Payments. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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