Pushpay to buy church-app business for $US3.1m as first-half sales soar, loss widens

Pushpay chief executive Chris Heaslip (Photo: Tinaz Karbhari)

Related Audio: Pushpay’s Chris Heaslip opens up to Andrew Patterson (August 2016)

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Pushpay Holdings, the mobile payments app developer, says it will acquire a church app business from Bluebridge Digital for $US3.1 million, continuing an expansion that saw revenue soar 308% in the first half while its net loss widened.

Bluebridge is one of the leading providers of church apps in the world and provides churches with "high-quality mobile apps, a scalable platform, intuitive content management system and mobile expertise." Pushpay will pay cash for the business after raising $A40 million in a private placement last month, ahead of its secondary listing on the ASX. It cited Giving USA figures showing $US119.3 billion was given to religious organisations in 2015, which it said amounted to a $US2.2 billion revenue opportunity that's expected to rise to $US3.1 billion in 2020.

Pushpay's operating revenue rose to $12 million in the six months ended September 30, from $US2.9 million a year earlier, the Auckland-domiciled, Redmond, US-headquartered company said in a statement. Its net loss widened to $US11.3 million from $US2.9 million.

Annualised committed monthly revenue (ACMR) rose to $US33.9 million from $US8.9 million, while total merchants rose to 5,286 from 2,102, it said. The company affirmed it is on track to reach ACMR of $US72 million ($100 million) and "breakeven on a monthly cash flow basis" in calendar 2017.

Pushpay is targeting US churches with technology that makes it easy for congregations to make donations using their mobile phones and is also expanding its mobile payment app beyond the faith sector to helping people pay their utility bills such as water and insurance. Its headcount rose to 280 in the first half from 143 a year earlier while total expenses jumped by 158% to $23.4 million, including sales and marketing costs of $8.3 million.

Its net cash outflow from operations rose to $7 million from $4.4 million. Before the $A40 million of new capital raised last month, the company's cash on hand had dwindled to $667,000 at September 30 from $8.4 million at March 31. Total cash and available funding fell about 30% to $US5.4 million.

Pushpay shares dropped 2.7% to $1.80 and have gained 5.7% this year.

(BusinessDesk)


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9 Comments & Questions

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I'm loving the operating leverage they are developing.

At 30 Sept 2015, Pushpay had approx $12.36m NZD of ACMR, with 143 employees, giving them ACMR per employee of around $86k.

At 30 September 2016, they had approx $47m NZD of ACMR from 280 employees, or approx $168k per employee.

With the combination of sales growth and average revenue per merchant rising, 2017 looks bright for Pushpay.

Disc: shareholder

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Haha, nice sell. Does look interesting.

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The usual good news from PPH: "Everything is on track, the story is moving along at great speed, as always, and we're all working very hard."

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But are you a believer ?

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They should have bought that app that the Catholic church just bought, an instant confession for all those sinners.

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Maybe the Catholic Church has a longer-term plan here. If they connect their app to a payment gateway they can relive the good old days and start selling indulgences. That would make Sindr and Tindr perfect pocket buddies. Pay for your sin before you Uber home for a night together.

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Brian Tamaki will be either delighted or spewing more venom on minorities such as app developers.

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It will make singing hymns without the need of a songsheet a helluva lot easier.

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US $3.1m for a leading church app developer........brings a touch of reality to valuations maybe.

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