Homepage Cashcard Australia Limited newsroom

Cashcard acquires EBS To create new force in payments system and announces year end 2002 results

Announcement posted by Cashcard Australia Limited 23 Oct 2002

Company acquires a complementary ATM business and positions for listing on ASX
Cashcard Australia Limited, (Cashcard) Australias leading independent provider of financial payments services, today announced the successful acquisition of Electronic Banking Solutions Limited (EBS). EBS is a specialist in ATM and EFTPOS solutions for the retail merchant market. The deal adds a significant retail ATM network to Cashcards existing operations. Almost 2,500 additional ATM locations at fuel outlets; shopping centres and malls; licensed hotels and clubs, as well as entertainment venues will be integrated into the national Cashcard network. The company also outlined its financial results for financial year ending 30 June 2002.

Cashcard Chief Executive Greg Baker said today The acquisition of EBS reinforces Cashcard as the countrys leading independent ATM services operator for both the wholesale and retail segments.

EBS will provide Cashcard with significantly increased profit potential from the acquired national retail ATM network. Prior to acquisition, EBS was owned by a group of shareholders principally comprising one of Australias leading private equity funds Gresham Private Equity Limited (GPE), and senior managers of EBS and their associates.

Ken Gaunt, Managing Director of EBS said This deal recognises and rewards the leadership position that we had built for EBS in the retail ATM deployment market.

As part of the acquisition and in line with its current review of its investments, St George Bank has normalised its 49% shareholding to around 8% by selling shares to Cashcard shareholders and GPE. GPE has become Cashcards largest shareholder with around 29% of the shares in the merged entity. St George remains the companys third largest shareholder and will continue all its existing commercial relationships with Cashcard as its supplier of electronic payment services. Other major shareholders of Cashcard include Suncorp Metway Ltd, Adelaide Bank and Bendigo Bank.

2002 Business Highlights
Cashcard also outlined its annual results for a thirteen month period to 30 June 2002. Business highlights included:
Revenue up 32%
Profit before tax up 21%
Acquisition and successful integration of Mayne Logistics Armaguard retail merchant ATM business
ATMs serviced by Cashcard increased by 69% to 3,200
Investment in SecurePay Holdings Pty Limited (SecurePay) completed for internet and telephone payment technologies
Record operational performance achieving 100% system uptime
446 million transactions processed

Mr Baker outlined, These results consolidate our track record of consistent business growth, as well as position the business for a long term and highly sustainable future.

Our diversification in the payments services market has led us to broaden our offerings from our core and highly successful transaction switching services for financial institutions. This has included areas of new growth including the merchant ATM market and e-payment solutions such as EFTPOS and future payment services strategies. We have also prepared for emerging market opportunities in the internet and telephone payments space, by investing in bill payment expert, SecurePay, he concluded.

Cashcard further confirmed its plans to list on the Australian Stock Exchange in the medium term of twelve to twenty-four months.

Strategic Development and Outlook
In March 2002, Cashcard was granted approval for the operation of Australias first independent Exchange Settlement Account, which went live in late August 2002. In conjunction, the company obtained full membership of the Consumer Electronic Clearing System of the Australian Payments Clearing Association (APCA). This positions the company to further manage and develop payment services without dependence on third party financial institutions. Marketing activities included the successful completion of an extensive Cashcard brand enhancement program across all forms of media and presentation materials.

Cashcard has maintained a long-term average growth rate of over 25% per annum for nearly 10 years, and believes
that its growth prospects for the future remain solid. Cashcard continues to position itself as the leader in the provision of electronic payments services for the Australian marketplace.

Cashcards key customers include every regional bank in Australia, every card-issuing building society in Australia, major retailers such as Shell and Coles Myer, as well as hundreds of smaller retailers using Cashcard ATM and EFTPOS services and direct entry payments such as payroll and insurance deductions.

Board appointments
Mr Richard Haddock was recently elected as Non-Executive Chairman. Mr Haddock is currently a Director of SME Growth Ltd and H G Ventures Ltd. He was previously Deputy General Manager of BNP Paribas, as well as Director of its
investment banking, stockbroking and asset management operations.

As part of the EBS acquisition, St George Bank sold down its shareholding position within Cashcard to around 8% and the St George Bank affiliated directors Mr John Loebenstein and Mr Peter Clare resigned. They have been replaced by Mr Greg Ruddock, Investment Director Gresham Private Equity; and EBS founder Mr Ken Gaunt who will be Sales Director of the merged entities of Cashcard and EBS.

About Cashcard
Cashcard is Australias premier payments services provider. It is the only independent services company to provide high volume payment services across the entire consumer electronic payments spectrum, including ATM and EFTPOS, Direct Entry, Bpay, Telephone and Internet payments. Launched in 1982, the group now services more than 50 member financial institutions and has processed around 2.5 billion EFT payments since 1993, making it one of the largest independent transaction providers in the region. For further details please visit www.cashcard.com.au.