Cuscal talks up IPO plans after a surge in earnings

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The payments processor owned by mutual banks and credit unions is lining up meetings with prospective investors as it attempts to hit the ASX before Christmas.

Cuscal, which connects non-major banks to the payments system, is eyeing a run at the ASX and could list by the end of the year if there is sufficient investor demand after reporting a near-quarter rise in its earnings over the past 12 months.Craig Kennedy, Cuscal’s chief executive, says he wants a float to set the company up for long-term success, not quick profit.

“We will be recommencing a process towards a potential IPO with a view to achieving this before the end of 2024,” the company said in its results. “We have consistent, moderate growth,” Mr Kennedy said. “We are not promoting hocky stick , or that we will burst out of the barriers. At a time of volatility, 66 per cent of our revenue is under long-term contracts, and we have never lost a top 20 client.”For investors trying to wrap their head around valuation, there is no direct comparison globally, although some analysts have compared it to Nasdaq-listed payments processing group Jack Henry.

“It is not like we are owned by two or three private equity houses, looking to maximise the share price at a liquidity event,” Mr Kennedy said. Rather, any IPO would be “the acknowledgement from existing shareholders that if we want to grow, and have ongoing access to capital, we need liquidity”.

 

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