PaySauce Limited Analysis

Overview

PaySauce is a multiple award-winning cloud-based FinTech business, delivering Software as a Service payroll solutions to small and medium sized enterprises ("SMEs").

PaySauce has a particular focus on agricultural SMEs. PaySauce enables SME owners to pay staff accurately and efficiently using web, iOS, and Android applications. The PaySauce platform includes mobile timesheets, payroll calculations, banking integration, PAYE filing, labour costing, automated general ledger entries and digital employment contracts

PaySauce was founded in 2015 by Asantha Wijeyeratne, a New Zealand FinTech entrepreneur with a record of success in building SME service businesses, and Troy Tarrant, a software architect and developer with a background in creating payroll and human resource solutions. Their vision is to take the Kiwi-grown PaySauce software platform to businesses around the globe, helping SME owners spend less time paying staff and more time doing what they love.

Performance

The following information was extracted from PaySauce Limited's full year results, released 21 May 2025:

FINANCIAL HIGHLIGHTS

• Operating revenue: $9.0m up 17% from $7.7m.
• Processing fee income: $6.3m up 18% lifted by an 11% increase in customers to 8,204.
• EBTDA : $1.4m, up $0.3m as revenue growth more than offset investments for growth and general inflationary pressures.
• Net profit before tax: $0.46m up $0.27m from $0.19m. Second consecutive profit.

Average revenue per user (ARPU) fell 5% to $86 from $91 as at 31 March 2024, with the increase in processing fee income diluted by the fall in interest rate income.

This also impacted ARR which rose to $8.5m as at 31 March 2025, compared to $8.0m at the same time a year ago. ARR from processing fees grew 14% year on year to $6.5m, more than offsetting the decline in ARR from interest revenue of 14% to $2.0m.

PaySauce achieved a net profit before tax of $0.46m, an increase of $0.27m from FY24. Net profit after tax was $0.68m, down $0.55m from last year, as the FY24 net profit after tax was inflated by a deferred tax asset of $1.02m recognised in relation to the losses carried forward.

PaySauce delivered EBTDA of $1.35m, up $0.29m (29%), as efficiency gains from investment into systems and processes delivered benefits. Recurring revenue growth of $1.08m (14%) outpaced expenditure increases of $0.99m (15%).

Free cash flow of $0.50m increased $0.20m on FY24. This was driven by an increase in net cash from operating activities (excluding funds held on behalf of customers) of $0.69m, up 47% year on year to $2.2m.

PaySauce continued to improve its key customer metrics, seeing a reduction in monthly churn to 0.99% per month, and an improvement in the gross margin percentage from 77% to 78% as the cost to serve customers reduced on a per customer basis.