PaySauce Limited/Announcement
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PaySauce FY24 Full Year Result and Annual Report

Full Year Results21 May 2024PYSInformation Technology

AUDITEDFINANCIALRESULTSFORTHEYEARTOTHEENDOFMARCH2024
PaySaucereportsmaidennetprofit;advances

growthstrategy

LowerHutt,NewZealand-22May2024

SoftwareasaServiceFintechPaySauce(NZX:PYS)todayreportsamaidenfull

yearnetprofitaftertaxof$1.2mfortheyearto31March2024asthecompany

benefitedfromgrowthincustomersandincreasedinterestincome.

Italsoreportssignificantprogressinpreparingforitsnextphaseofgrowth.

PaySauceisnearingcompletionoftheproofofconceptwhichwilldemonstrate

theabilitytoexecutewholesalepayrollwiththenewGen2.0payrollengine.

PaySaucealsoextendedthereachofitsmicrobusinessappfromitscoredairy

farmermarketintonewverticalsofplumbers,buildersandhospitality.

HIGHLIGHTS

1


Operatingrevenue:$7.7mup33%liftedbya7%increaseincustomersto

7,368anda11%increaseinaveragemonthlyrevenueperuser(ARPU)to$91.


Processingfeeincome:$5.4mup17%liftedbycustomergrowthandfee

increasesaswepassedonrisingcosts.


Interestincome:$2.2mup96%liftedbycustomergrowthandcontinued

highinterestrates.


Annualisedrecurringrevenue(ARR):$8mup19%from$6.7m.


EBTDA:$1.06m,reversesEBTDAlossof$0.08mwithrevenuegrowthmore

2

thanoffsettinginvestmentsforgrowthandgeneralinflationarypressures.


Netprofitaftertax(NPAT):$1.2mmaidennetprofit,reversinga$0.6mloss.

ChairShelleyRuhasaid:“Ourachievementofourfirstfullyearnetprofitaftertax

andpositivecashflowsisasignificantmilestone,especiallyinthefaceofthe

headwindsthatgrowthcompaniessuchasPaySauceandindeedourcustomers

havefacedformuchofthelastyear.

“Persistentinflationandsubdueddemandhavepresentedachallengetonew

customergrowthoutsideourcoredairyvertical.However,ouroperatingrevenue

hasbeensupportedbyhighinterestrates,whichhaveinsulatedPaySaucefrom

thesepressures.

2

Earningsbeforetaxdepreciationandamortisationisanon-GAAPmeasureoffinancialperformance.It

isdefinedandreconciledtotheGAAPmeasureofnetprofitonpage25ofthecompany’sannualreport

releasedtotheNZXtodayandavailableonthecompany’swebsite.

1

AllcomparisonsareagainstFY23unlessotherwisestated.

“Asaprofitableandcashflowpositivecompanyweremainfirmlyinchargeofour
owndestinyandhavebeenabletoadvancestrategiesthatarenowpoisedto

deliveranaccelerationofgrowthanddrivethelong-termsustainabilityofour

business.

“Wehavealsoputinplacethefoundationsforournextphaseofgrowth.Thekey

achievementswerepilotingournewGen2.0payrollengine,significantprogress

ontheproof-of-conceptworkofournewwholesalesolutionandmigratingour

techstacktoAmazonWebServices.Itisanexcitingtimeforthecompany.”

ChiefExecutiveOfficerandCo-FounderAsanthaWijeyeratnesaid:“The2024

financialyearhasbeenayearoftransformationforPaySauce.

“We’vedeliveredonourstrategicobjectives,themostsignificantofwhichwas

re-investingforgrowth.WepilotedournewGen2.0payrollengineandare

nearingcompletionofthewholesalepayrollproofofconcept.Thisisfora

significantcustomerthathasthepotentialtoaddasignificantnumberofpeople

usingourtechnology.Thisdevelopmentwillputinplacethefoundationsofthe

company’snextphaseofgrowth.

“TheenginewillenablePaySaucetomakethefirststepsinawholesalepayroll

strategythatwillseeourtechnologyembeddedinbusinessmanagement

platforms.Itwillalso,overtime,formthecoreofourmicrobusinessappwhichwill

accelerateourgrowthintonewverticalssuchasourcurrenttargetofthe

constructionindustryandrelatedtrades.”

FINANCIALPERFORMANCE

OperatingrevenuefortheyeartotheendofMarch2024rose33%to$7.7mfrom

$5.8mintheprioryear.Theresultwasunderpinnedbythestrongriseininterest

ratesandanincreaseinthebalanceoffundsheldonaccountforcustomers,

whichledtoan96%riseininterestincome.

Processingfeeincomeroseby17%to$5.4mfrom$4.6m,anincreasedrivenbya

7%increaseincustomersto7,368from6,875atthesametimeayearagoand

priceincreasesasPaySaucepassedonthecostsofinflationtothebusiness.

Averagemonthlyrevenueperuser(ARPU)increased11%to$91from$81inthe

prioryear.ARRattheendofMarchroseto$8.0mfrom$6.7matthesametimea

yearago.

PaySauceachievedanunderlyingNPATof$0.2m,whichwasinflatedbya$1.0m
taxadjustmentasadeferredtaxassetwasrecognisedintheyear.PaySauceisnow

profitableandexpectstobeabletoutilisesomeofthecarriedforwardtaxlossesin

futureyears.

PaySaucedeliveredmaidenfullyearearningswithEBTDAreaching$1.06m

reversingtheprioryear’s$0.08mloss,whileNetProfitAfterTaxroseto$1.2mup

fromlastyear’slossof$0.6m.Inbothcasestheimprovementwasunderpinnedby

growthintotalrevenue,butthegainsweredilutedbyinvestmentsforgrowth.

Theseinvestmentsincludedthedevelopmentintothenewpayrollengineandthe

wholesalepayrollproofofconcept,enhancementstodevelopmentinfrastructure

andtheexpansionofthesalesandmarketingteams.PaySaucealsosawageneral

increaseincostsinlinewiththebroaderinflationarypressuresaffectingthe

economy.

Operatingcashflows,beforetheinflowoffundsduetocustomersandtheIRD,

roseto$1.5millionfrom$0.3mintheprioryearandPaySaucepostedpositivefree

cashflowof$0.3mafterallowingforinvestmentactivity,reversingtheprioryear

negativefreecashflowof$645k.

STRATEGICPROGRESS
Oncedelivered,thenewGen2.0payrollenginewillbeabletobequickly

configuredtocomplywithcomplexpayrollrulesinanyjurisdictionaroundthe

worldandisdesignedforsuperiorspeedandprocessing.Thewholesalesolution

willbecomplementarytotheexistingmicrobusinesssolutionwherePaySauce

willcontinuetoinvestforgrowth.

Customergrowthslowedrelativetotheyearearlierreflectingboththematurityof

thecompany’scoredairysectorverticalandtheearlystageofeffortstodiversify

andgrowourcustomerbase.Totalcustomeracquisitioncostsweresimilartothe

prioryearintotal,butincreasedonapercustomerbasisreflectingtheearlystage

ofthecompany’spenetrationintothenewconstructionandtradeverticals.

PaySauce’smonthlychurnrateincreasedto1.18%comparedto1.15%atthesame

timeayearagoastougheconomicconditionstooktheirtollonsmallbusiness

customers.Despitethis-customerlifetimevalueincreased23%to$43.4m,asthe

company’smarginsandcustomerbasegrew.

PaySaucecontinuestoachieveitsgoaltoexceedtheruleof40globalbenchmark

forSaaScompaniesandwhilethecompany’sscorehasmoderatedoverthelast

year,theinvestmentsputinplaceforthefuturepositionthecompanytoreverse
thistrendfortheyearahead.

OUTLOOK

AsanthaWijeyeratnesaidheremainedconfidentaboutPaySauce’sprospects.

“Thecurrenthigh-interestrateenvironmentappearssettopersistandunderpin

ourrevenueforatleastthenexttwelvemonths.Aswenotedatthehalfyearit

representsanaturalhedgeforPaySaucegiventheimpactelevatedinterestrates

arehavingonthebroadereconomy,”Wijeyeratnesaid.

“Againstthis,wearethrilledbytheopportunitiespresentedwiththeadvancesof

theGen2.0payrollengineandourwholesalepayrollsolution.Webelievethese

developmentscombinedarebringingourgoalof$10millioninARRintosight.”

Furtherdetailonthecompany’sperformanceisincludedintheannualreportand

investorpresentationreleasedtotheNZXtodayandalsoavailableonthe

company’sinvestorwebsite:https://www.paysauce.com/investor/#/documents

PaySaucewillhostanInvestorandMediaconferencecalltodaytodiscussthefull

yearresult.

Theconferencecallisscheduledtobeginat10.00amNZDT.

Investorsandmediaareinvitedtoattendtheconferencecall,andcanregister

theirinterestbyemailinginvestor@paysauce.combefore9amtoreceivethe

conferencecalllink.

ReleasedforandonbehalfofPaySaucebyJaimeMonaghan,ChiefFinancial

Officer.

ENDS

ABOUTPAYSAUCE

PaySauceisaSaaSfintechplatformprovidingsolutionsforpeopleatworkin14

jurisdictionsacrosstheAsia-Pacificregion.Thetechnologyenablessmall

employerstodigitallyonboard,payandmanageemployeesfromanydevice.The

platformincludesrosters,mobiletimesheets,payrollcalculations,banking

integration,automatedpayments,PAYEfiling,labourcosting,automatedgeneral

ledgerentriesanddigitalemploymentcontracts.ThePayNowfeatureenables

customers’employeestoaccessthepaythey’veearnedbeforepayday,providinga

freealternativetopaydaylenders.www.paysauce.com

CONTACT
AsanthaWijeyeratne

CEOPaySauce

+6421554600

Pleasedirectanyinvestmentqueriestoinvestor@paysauce.com

---

Results announcement
(for Equity Security issuer/Equity and Debt Security issuer)

Updated as at June 2023



Results for announcement to the market

Name of issuer PaySauce Limited

Reporting Period 12 months to 31 March 2024

Previous Reporting Period 6 months to 30 September 2023

Currency NZD

Amount (000s) Percentage change

Revenue from continuing

operations

$7,716 33%

Total Revenue $7,716 33%

Net profit/(loss) from

continuing operations

$1,232 -321% (reversed a loss)

Total net profit/(loss) $1,232 -321% (reversed a loss)

Interim/Final Dividend

Amount per Quoted Equity

Security

It is not proposed to pay a dividend

Imputed amount per Quoted

Equity Security

Not Applicable

Record Date Not Applicable

Dividend Payment Date Not Applicable

Current period Prior comparable period

Net tangible assets per

Quoted Equity Security

-$0.00237224 -$0.00441609

A brief explanation of any of

the figures above necessary

to enable the figures to be

understood

Please refer to the attached Annual Report and financial

statements

Authority for this announcement

Name of person


authorised

to make this announcement

Jaime Monaghan

Contact person for this

announcement

Jaime Monaghan

Contact phone number +64 22 5246366

Contact email address investor@paysauce.com

Date of release through MAP


22 May 2024


Audited financial statements accompany this announcement.

---

1
2023

2024

2024

Annual


Report

23
Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

payroll

Gen 2.0 Payroll

Engine Rev

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

Wholesale

Payroll

Micro-business

App

A

P

I

PaySauce

Gen 2.0

Engine

A

P

I

Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

Payroll

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

4−6 months

sales and

implementation

TIME TO

SALE

Download the app

and pay staff the

same day

TIME TO

SALE

Serve new

customer base

following

implementation

SALES

CYCLE

Support

Accounting and

Direct marketing

channels

SALES

CYCLE

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

2024 marks a milestone year with PaySauce

delivering a maiden full year profit.


The bottom-line profit is underpinned by

continued customer growth on our existing

platform, with development focussed on

our new Gen 2.0 payroll engine to drive

future growth.

The proof of concept for delivering a B2B

payroll solution is nearing completion,

proving our ability to execute wholesale

payroll to supercharge our future offering.

Contents

04 / FY24 highlights

06 / FY25 Strategy

08 / Leadership messages

12 / Delivering on the plan

22 / Leadership team

24 / Performance (SaaS metrics)

34 / Financial statements

65 / Corporate governance

82 / Company directory

45
1

3

2

4

Free

Cashflow

$

0.3

m

46

Rule of 40

1

Annualised

Recurring

Revenue

(ARR)

$

8.0

m

Up 19%

YoY

Up $0.94m

YoY

2

Above industry

benchmark

What we’ve delivered

Our FY24 strategy

Reinvest for long

term growth

Built and piloted the Gen 2.0 payroll

engine

Proof of concept for wholesale

payroll nearing completion

New micro-business payroll

application in progress

Migrated the tech stack to AWS

Obsess over

customers

Consolidated our position in the core

rural sector

Commenced marketing to new

verticals

Strong customer advocacy

maintained with NPS increase to 58

Delivered more features to delight

customers

Win-Win-Win

partnerships

Further invested in the Accountant

channel to drive customer acquisition

New partnership with Master

Plumbers and Master Builders

Evolved the payments solutions in NZ

with Akahu and ASB

Improved internal efficiencies with

Salesforce

Awesome

people

Recognised as a top 100 tech startup

employer by Matchstiq

Added product & development

capability

Building specialist functions for

scaling up

Improved internal efficiencies with

Salesforce CRM solution

How we’re performed

Highlights

1. The sum of the company’s growth rate and EBTDA margin. A figure of above 40 is an international

financial efficiency benchmark for SaaS companies. 2. Excludes funds due to customers and IRD.

NPAT

(Net Profit

after Tax)

$

1.23

m

Up $1.79m

YoY

Maiden

Profit

67
Where we’re going

Our FY25 strategy

Partnerships

Powering our go-forward strategy

The strategy going forward is to build on the solid

foundations delivered in FY24 - growing the business to

deliver value back to our shareholders.

Supercharge growth is about attracting new customers to

PaySauce. Marketing campaigns have begun with a view to

increasing brand awareness and showing small businesses

that we understand them.

We expect further investment into our Sales capability

will drive increased business from new and existing

accounting partners.

Customer love is demonstrated through our

understanding of the unique challenges that face small

business owners, giving them the two things they need

the most: peace of mind and time. Our customers are our

strongest advocates and our most effective marketing

channel.

Scalability through every stage of the customer journey

is critical to ensuring we can support the growth in a

sustainable way. From onboarding new customers, to

providing an intuitive, self-service payroll experience to

ensuring that back end processes are powered by reliable

tooling with the optimal level of human input.

These three strategic priorities are underpinned by the

three key areas of investment for PaySauce: People,

Product and Partnerships. Having strengthened these

core functions in FY24, they become the foundations of

success for FY25 and beyond.

FY24 saw significant investment into long-term growth

as a strategic priority. Having delivered on that strategic

objective, the strategy going forward delivers continued

investment into the product and platform underpinning

future priorities.

Supercharge growth

We’ll deliver growth through

two distinct paths: continuing

our work directly with the SME

market as well as opening a

whole new opportunity with

wholesale.

To get to $10m ARR, we will:

• Improve brand awareness and

opportunities with targeted

sales and marketing strategies

• Deliver new interface for both

web and mobile

• Identify new wholesale

opportunities, including new

jurisdictions

Loving our customers

Our relationship with our

customers is mutually

beneficial: they get peace

of mind and time through a

great product, and we get

a dedicated fanbase as our

best source of growth.

To make this happen, we will:

• Delight our users with features

and functionality they need and

want

• Provide customers with the

knowledge and guidance they

need to be successful

• Improve product and service

experiences with in-app support

and guidance

Scalability

To ensure we can retain

very high service levels at

scale, we’re focusing on

the improvements to how

we operate. Removing pain

points for ourselves and our

customers means we have

more time to focus on the

growth activities.

To operate more efficiently and

safely, we will:

• Create a smoother journey for

new and existing customers

• Implement AI and other new

technologies to build scalable

processes

• Optimise our tech stack for

speed, security and scale

PeopleProduct

89
InterestProcessing Fees

Annualised Recurring Revenue

Mar 21Mar 22Mar 23Mar 24

$0 M

$2 M

$4 M

$6 M

$8 M

MESSAGE FROM THE CHAIR

Shelley Ruha

Independent Director,

Chair

3. EBTDA (earnings before tax, depreciation and amortisation) is a non-GAAP financial measure that is defined on page 25 of this report.



19

%

Annualised

Recurring

Revenue (ARR)

$8.0m

In charge of

our destiny

I am delighted to report on the outstanding progress

PaySauce has made over the last year.

We have delivered our first full year net profit and positive

cashflow as we benefited from growth in customers and

increased interest income. This is a significant milestone,

especially in the face of the headwinds that growth

companies such as PaySauce and indeed our customers

have faced for much of the last year.

Persistent inflation and subdued demand have

presented a challenge to new customer growth outside

our core dairy vertical. However, our operating revenue

has been supported by high interest rates, which have

insulated PaySauce from these pressures.

As a profitable and cashflow positive company we

remain firmly in charge of our own destiny and have been

able to advance strategies that are now poised to deliver

an acceleration of growth and drive the long-term

sustainability of our business.

We have also put in place the foundations for our next

phase of growth. The key achievements were the

development of our new Gen 2.0 payroll engine, significant

progress on the proof-of-concept work of our new

wholesale solution and migrating our tech stack to Amazon

Web Services.

It is an exciting time for the company.

Financial Performance

Operating revenue for the year to the end of March 2024

rose 33% to $7.7m from $5.8m in the prior year. The

result was underpinned by the strong rise in interest rates

and an increase in the balance of funds held on account

for our customers, which led to an 96% rise in interest

income.

Processing fee income rose by 17% to $5.4m from

$4.6m, an increase driven by a 7% increase in customers

to 7,368 from 6,875 at the same time a year ago and price

increases as we passed on the costs of inflation in our

business.

Average monthly revenue per customer increased 11%

to $91 from $81 in the prior year. Annualised Recurring

Revenue (ARR) at the end of March rose to $8.0m from

$6.7m at the same time a year ago.

We achieved an underlying NPAT of $0.2m, which was

inflated by a $1.0m tax adjustment as we recognised a

deferred tax asset in the year. We are now profitable and

expect to be able to utilise some of the carried forward

tax losses in future years.

We delivered maiden full year earnings with EBTDA

3


reaching $1.1m reversing the prior year’s $80k loss,

while Net Profit After Tax rose to $1.2m up from last

year’s loss of $558k. In both cases the improvement

was underpinned by growth in total revenue, but the

gains were diluted by investments for growth. These

investments included piloting the new payroll engine and

the wholesale solution, enhancements to our information

infrastructure and the expansion of the sales and

marketing teams. We also saw a general increase in costs

in line with the broader inflationary pressures affecting

the economy.

Operating cashflows, before the inflow of funds due to

customers and the IRD rose to $1.5 million from $264k in

the prior year and we posted positive free cashflow of

$296k after allowing for investment activity, reversing the

prior year negative free cashflow of $645k.

Outlook

The board and management remain confident about

the company’s prospects. The current high-interest

rate environment appears set to persist and underpin

our revenue for at least the next twelve months. As we

noted at the half year it represents a natural hedge for

PaySauce given the impact elevated interest rates are

having on the broader economy.

Against this, we are thrilled by the opportunities

presented with the advances of the Gen 2.0 payroll

engine and our wholesale payroll solution. We believe

these developments combined are bringing our goal of

$10 million in ARR into sight.

We thank the PaySauce team for their dedication over

this past year.

Shelley Ruha

Independent Director, Chair

We’ve delivered profitability, positive

cashflow, and advanced strategies that

will enable us to deliver an acceleration

of growth and drive the long-term

sustainability of our business

1011
MESSAGE FROM THE CEO


Asantha Wijeyeratne

CEO, Co-founder

Total Customer LTV

Mar 21Mar 22Mar 23Mar 24

$50 M

$40 M

$30 M

$20 M

$10 M

$0 M

23

%

Total Customer

lifetime value

$43m

Poised for an

acceleration

in growth

The 2024 financial year has been a year of transformation

for PaySauce.

We’ve delivered on our strategic objectives, the most

significant of which was re-investing for growth.

We piloted our new Gen 2.0 payroll engine, and are

nearing completion of the wholesale payroll proof of

concept. This is for a significant customer that has the

potential to add a significant number of people using

our technology. This development will put in place the

foundations of the company’s next phase of growth.

The engine will enable PaySauce to make the first steps in

a wholesale payroll strategy that will see our technology

embedded in business management platforms. It will

also, over time, form the core of our microbusiness app

which will accelerate our growth into new verticals such

as our current target of the construction industry and

related trades.

Strategic Progress

Once delivered, the new Gen 2.0 payroll engine will be

able to be quickly configured to comply with complex

payroll rules in any jurisdiction around the world and is

designed for superior speed and processing.

The wholesale solution will be complementary to our

existing microbusiness solution. New contracts can

deliver an immediate and significant uplift in ARR with

pricing set at rates per pay slip and agreements set with

contracted minimum volumes.

Contract periods for the wholesale solution are expected

to be fixed term over multiple years and where the service

is offered in New Zealand, PaySauce will continue to earn

interest on balances held on behalf of clients. Meanwhile,

the cost to serve customers is expected to be lower

since the wholesale customer owns the direct customer

relationship.

Against this there is a longer sales cycle than the mobile

app. Additionally, there are development costs as

PaySauce will be contracted to maintain ongoing Service

Level Agreements.

To ready the company for the expected increase in

service demand generated by this new strategy we

have migrated production servers and back-end tools

to Amazon Web Services (AWS). This shift will allow

us to scale quickly and give us the flexibility to offer

continuous product upgrades.

Customer Growth

We meanwhile continued to drive the adoption of our

microbusiness app.

Customer growth slowed relative to the year earlier,

growing 7% year on year, reflecting both the maturity of

the company’s core dairy sector vertical and the early

stage of efforts to diversify and grow our customer base.

Total customer acquisition costs were similar to the

prior year in total, but increased on a per customer basis

reflecting the early stage of our penetration into the new

construction and trade verticals.

A key step to grow in these markets has been to focus

our sales and marketing efforts on partnering with

accountants and industry associations such as Master

Plumbers and Master Builders.

We are pleased with the progress we have made with

accountants. We have recruited more than 50 separate

firms to our partnership programme and they have already

referred us more than 600 potential customers.

Digital marketing campaigns have begun alongside the

industry association partnerships to further grow our

brand awareness in this space.

We have also expanded our sales and marketing teams

with the appointment of a new Marketing Manager, as well

as a new Head of Sales and new Business Development

managers, the latter of which have a focus on developing

new and existing relationships with chartered

accountants, who are trusted advisors to thousands of

potential and existing customers.

Our monthly churn rate increased to 1.18% compared to

1.15% at the same time a year ago as tough economic

conditions took their toll on our small business

customers. Despite this - customer lifetime value

increased 23% to $43.4m, as we grew our margins and

our customer base.

PaySauce continues to achieve its goal to exceed the

rule of 40 global benchmark for SaaS companies and

while our score has moderated over the last year, the

investments we have put in place for future, position the

company to reverse this trend for the year ahead.

With the wholesale payroll proof of concept

nearing completion and our expanding

reach into new target verticals - we’re poised

for an acceleration in growth in FY25

We continue to attribute our success to a payroll product

that is easy to use, and the incredible knowledge

and efforts of our customer support team. This is

underpinned by the determination of the wider team and

a vindication of our strategy to prioritise the recruitment

and retention of great people. Alongside Shelley, I want

to thank them for their efforts and dedication over the

last year.


Looking Forward

I am proud of what we achieved over the last year and

the promise offered in the coming twelve months and

beyond by the advances in our technology and our new

wholesale strategy. We have now put in place all the

building blocks for an acceleration of growth.

I look forward to updating you on progress at the end of

the first quarter and at our annual meeting in September.

Asantha Wijeyeratne

Executive Director, CEO and Co-Founder

1213
Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

payroll

Gen 2.0 Payroll

Engine Rev

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

Wholesale

Payroll

Micro-business

App

A

P

I

PaySauce

Gen 2.0

Engine

A

P

I

Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

Payroll

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

4−6 months

sales and

implementation

TIME TO

SALE

Download the app

and pay staff the

same day

TIME TO

SALE

Serve new

customer base

following

implementation

SALES

CYCLE

Support

Accounting and

Direct marketing

channels

SALES

CYCLE

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

Embedded payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Embedded

Payroll

Gen 2.0 Payroll

Engine Rev

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

Embedded

Payroll

Micro-business

App

A

P

I

PaySauce

Gen 2.0

Engine

A

P

I

Embedded payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Embedded

Payroll

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

4−6 months

sales and

implementation

TIME TO

SALE

Download the app

and pay staff the

same day

TIME TO

SALE

Serve new

customer base

following

implementation

SALES

CYCLE

Support

Accounting and

Direct marketing

channels

SALES

CYCLE

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

payroll

Gen 2.0 Payroll

Engine Rev

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

Wholesale

Payroll

Micro-business

App

A

P

I

PaySauce

Gen 2.0

Engine

A

P

I

Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

Payroll

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

4−6 months

sales and

implementation

TIME TO

SALE

Download the app

and pay staff the

same day

TIME TO

SALE

Serve new

customer base

following

implementation

SALES

CYCLE

Support

Accounting and

Direct marketing

channels

SALES

CYCLE

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

DELIVERING ON THE PLAN

STRATEGIC PRIORITY #1

Re-invest for long

term growth

40

%

By investing in our inf rastructure, following

best in class architecture and security

practices, and locking in adjacent markets,

we’ve made the business scalable in

a sustainable way. This has delivered a

platform f rom which to launch our Gen 2.0

payroll engine, creating wholesale payroll

opportunities as well as strengthening our

existing product offerings.

PaySauce Gen 2.0 Payroll Engine

The Gen 2.0 payroll engine is a step-change in the

architectural evolution for PaySauce. The modular

architecture enables different components to be pieced

together to deliver a first-class payroll experience for

different end users, tailored to their needs. In the year ended

March 2024, the two key products developed were the

payroll engine and the Application Programming Interface

(API).

The payroll engine has been designed and built to provide

a payroll calculation service that can be re-used in different

jurisdictions with minimal to no code changes. By using a

unique but simple rules configuration tool, international

expansion into new jurisdictions is simplified: new rules can

easily be configured to enable accurate calculations and

application of local legislation or regulation. The payroll

engine also enables jurisdiction-specific tax filing, tax

payment and employee payments.

The API provides our Partner development teams with

an interface to the payroll engine. The API will enable an

accelerated uptake for end users looking to add payroll

services to their existing customers. The API is largely

re-usable between jurisdictions, but can receive specific

customisations based on key legislative features of

jurisdictions that we enter. The flexibility of the API allows

us to decide on a case-by-case basis if customer-

specific extensions are a good fit for the core product

offering or if they are considered a bespoke solution

for the customer. This allows us to be very focused on

meeting customer needs without sacrificing operational

efficiency.

Combined, the payroll engine and API have two primary

use cases. Firstly, they’ll enable PaySauce to offer a

wholesale payroll product to larger enterprises who

already provide adjacent services to customers, adding

a revenue stream for them, for PaySauce, and reducing

subscription services for the mutual customers.

Development commenced this year on a proof of

concept for the first consumer of the payroll engine and

API, and is nearing completion as we work through the

final desired outcomes.

Secondly, PaySauce will build a beautiful new interface

powered by our new payroll engine and API. This

new application for micro-businesses will initially be

launched in New Zealand. This will allow new customers

employing 1-5 employees to onboard, manage, make

payments and file tax records for their staff from their

phone. Delivering a new interface for both new and

existing customers allows us to unify our current product

portfolio, which currently consists of several offerings.

These will be merged into this one new suite.


Proof of

concept for

first wholesale

payroll

opportunity

nearing

completion

Successfully

migrated the tech

stack to AWS

Invested in

product and

development

specialist talent

Increased

investment into

R&D by 40% YoY

AWS

1415
Mar 24Mar 23Mar 22Mar 21

$0.5m

$1.0m

$1.5m

$2.0m

FY24

4

Investment

into R&D

R&D Investment

AWS Migration

FY24 saw PaySauce's largest technological change

to date, with the entire suite of test and production

environments shifted from Catalyst Cloud to Amazon

Web Services (AWS). Following substantial planning

and preparation, the migration ran successfully within

the scheduled maintenance window and customers

experienced a seamless transition to the new servers.

AWS unlocks improved tooling and servicing of

PaySauce’s architecture, including faster release

cycles, the ability to increase capacity on demand and

a reduction in reliance on key PaySauce team members

through the use of appropriate managed services.

Now supporting over 7,000 customers, business

continuity planning is even more critical. AWS lowers

the barriers to the implementation of highly available

systems, allowing normal operation to continue should

a range of previously service-interrupting events occur.

Amazon’s global presence and extensive support for

infrastructure as code also allows the team to quickly

spin up customer-ready copies of PaySauce in alternate

regions on demand. These capabilities combined with

strong security features such as secrets management,

threat detection, web application firewalling and audit

logging mean a big step forward in the ability to manage

and control technical risks without slowing the product

delivery pipeline.

Reinvesting in the product

Reinvestment for growth has been the focus for

PaySauce this year with investment into product

development being a core component of this. Increased

investment has been made into headcount, outsourced

development and streamlining internal processes as

PaySauce builds for scale. The three focus points for the

year have been:

• Enhancing the existing product architecture and

infrastructure for scale;

• Using the Gen 2.0 payroll engine to deliver a Proof of

Concept for the first wholesale payroll opportunity;

and

• Enhancing the existing products in response to

customers needs.

As the key strategic deliverable in FY24, investment into

Product and Development increased 12% year on year,

reflecting 26% of total recurring revenue (31% in 2023).

The incremental investment improved the efficiency

of development release cycles. This efficiency gain is

reflected in the capitalisation rate which improved 7

percentage points to 56%.

Tooling for growth

Our success has come from the love we’ve shown our

customers and the love they’ve shown us in return. Our

Customer Support centre offers exceptional service,

giving our customers the peace of mind that they’re in

safe hands. To ensure that we can continue to support an

increasing number of customers, investment into tooling

has allowed our Customer Support team to offer better

service. Through partners like Salesforce, we’ve been

able to streamline the CRM and utilise AI capability to

ensure our Support staff can confidently provide timely

responses to customers.

New Verticals

Having obtained market dominance in the rural sectors in

New Zealand, the benefit of targeting specific verticals

and demonstrating that we understand them deeply is

essential. The construction sector and related trades were

targeted for growth and partnerships with key players,

such as Master Plumbers and Master Builders were formed

in FY24. Market penetration takes time and the successes

and lessons taken from entering the dairy sector will

be applied to the new sectors, with meaningful growth

anticipated from new verticals in FY25.

$

2.0

m

Wholesale

Payroll

Micro-business

App

A

P

I

PaySauce

Gen 2.0

Engine

A

P

I

4. Expensed and capitalised

1617
DELIVERING ON THE PLAN

STRATEGIC PRIORITY #2

Obsess over

customers

Customers remain our best marketing tool,

and FY24 saw PaySauce implement further

improvements to the service offered to

our customers. A focus on improving the

customer experience is good for business

too! The team implemented more intuitive

features that reduced the volume of calls

to the call centre, enabling the Customer

Support team to continue excelling without

the need for additional headcount. The

result was reflected in the increase in the Net

Promoter Score (NPS) to 58 - a result we’re

very proud of.

of 96%Customer Support

The improvements have also come through investment

into our internal systems, including a new phone system

enabling faster response times and ultimately faster

resolutions for customers. Improved reporting metrics

also enable a faster customer satisfaction (CSAT)

score, which allows us to better understand whether

customers’ queries have been resolved.

Customer-led improvements

With Salesforce’s CRM integrated into the Customer

Support team, categorisation of new customer cases is

simpler to use, making the data capture more accurate

and more timely. This in turn leads to more informed

decisioning in relation to prioritisation of product

feature improvements, as well as how we can support

our customers with educational resources. We know our

customers don’t go into business to be payroll experts,

and providing knowledge articles or interactive webinars

further strengthens their peace of mind.

Wholesale payroll opportunities

To date, we’ve had very close contact with our customers

and served them either directly, or through one of our

incredibly supportive Accountant channel partners.

In FY24, we identified the opportunity to leverage a

new Gen 2.0 Payroll Engine to serve a new customer

base through a wholesale offering. Our product team

is nearing completion on the proof of concept with our

first potential wholesale payroll customer. Once the first

wholesale payroll opportunity is executed, the customer

relationship will change to a more technical one, with

the customer owning the relationship with the end users

(small business owners and their employees).

Achieved Net Promoter Score of

58 (well above industry average)

58

NPS

PayNow saved customers an

estimated $2.5m in interest

and fees in FY24

Customer satisfaction score

(CSAT) of 96%

Product improvements reduced

customer case volumes by 7%

year on year, despite growing our

customer base 7%

7

%

$

2.5

m

96

%

1819
Win-win-win

partnerships

DELIVERING ON THE PLAN

STRATEGIC PRIORITY #3

Over 50 New

Accountants joined

and referred 600

customers

Accountants

Customers

50

600

PaySauce uses partnerships to ensure a

better outcome for PaySauce, PaySauce’s

customers, and the chosen partner.

Partnerships are used to enhance PaySauce’s

product and to reach audiences in target

markets.

Product partnerships include Akahu,

who enable banking APIs, AplyID who

enable AML verification of our customers’

employees, and BNZ who provide interest

and fee-free lending to ensure we can keep

our PayNow product free. By leveraging their

industry expertise, we can provide a better

customer experience (and provide a genuine

alternative protecting them f rom predatory

payday lenders!).

Partnerships to reach audiences include sponsorship,

channel, industry and distribution partnerships.

Sponsorship partnerships are generally intended to

increase awareness of the PaySauce brand. These

include our partnerships with Wellington Rugby and

Taranaki Rugby Football Union. Both unions are PaySauce

customers, and both have been Bunnings Warehouse

NPC Champions during our partnerships.

In FY24, we’ve focussed on expanding our reach beyond

the rural sectors in New Zealand. A new partnership with

Master Plumbers enables us to target the under-served

plumbing sector with a first class payroll product that

enables plumbers to pay their workers from their van.

Partnering with industry experts gives confidence to the

sector that the product is suitable for them, and people

like them. The partnerships enable PaySauce to present

at conferences and talk to the sector directly to better

understand their industry specific needs.The move into

more urban locations is deliberate to emphasise that

PaySaue is much more than an agri-payroll provider.

Investment into a larger sales team has been focused

on targeting the largest cities, with two Auckland based

BDMs and a newly appointed BDM in Christchurch. With

Accountants being our primary channel partners, the

focus from our sales team has been to increase the reach

to make PaySauce the payroll solution that Accountants

recommend to their clients.

PaySauce partnered with Salesforce to develop AI

capabilities to help augment their employees’ technical

knowledge, ensuring customers are provided with

effective and efficient support. The AI allows Customer

Support employees to broaden their capabilities by

leveraging a centralised company-wide knowledge base.


PaySauce implemented an internal chatbot, powered

by Salesforce’s Service Cloud Einstein, to assist with

framing research and customer responses. This supports

the capability of the Customer team, allowing them to

confidently shape answers and respond to customers

in a timely manner. New employees add value faster

with the ability to “fact check” the responses before

communicating back to the customer – maintaining their

values of prioritising the customer experience.

New industry partnership

with Master Plumbers

New

partnerships

Strong new tech

partnerships with Amazon

and Salesforce

2021
DELIVERING ON THE PLAN

STRATEGIC PRIORITY #4

Grew Product & Development

Team by 50%

Recognised as top 100 tech/

startup employer by Matchstiq

Top 100

tech/

startup

employer

Awesome

people

People are the largest investment at

PaySauce, with over $5m paid to our

people in FY24. As well as increasing

headcount in our key growth areas, we

invested in tools that supported our

people to be more efficient.

Jacques Labuschagne joined the team as Head of

Delivery, leveraging his previous expertise to improve

the discipline and structure in our development function.

The team was split into squads to focus work into two

streams: delivering the Gen 2.0 payroll engine and

continuing to improve the existing product supporting

the current customer base. Overall, we grew our Product

& Development Team by 50%, including specialist

DevOps talent and more development capability. We

continue to also utilise the expertise of contractors

or specialist partners when needed to support our

permanent inhouse team, staying flexible with how we

resource our projects on an as-needs basis.

While our overall headcount has not increased

significantly, the make up of our workforce has changed

shape to focus more on our technology function.

The investment into a better resourced Product &

Development function is bearing fruit, with a significant

improvement in the velocity of work here - directly

impacting our ability to deliver on our strategic

objectives.

Our Sales & Marketing Team has been boosted with the

addition of our new Head of Sales and new Business

Development Managers: they bring a depth of collective

experience selling payroll solutions as well as a deep

understanding of our accountancy partner channel. Our

new Marketing Manager brings a wealth of experience in

managing campaigns to support brand awareness and

drive sales, and has driven a number of improvements

and efficiencies as well as new campaigns and initiatives

to help us reach more small business employers.

We’re well known for our excellent customer service.

This year, we’ve focused on supporting this team with

increased tooling at their disposal to help with both on

the job learning and training as well as easier access for

our customers to reach help when it is needed.

We’ve continued our commitment to looking after

the PayForce and helping them to share in PaySauce’s

success, and this year our Employee Share Scheme

continued - albeit with changes for it to be simpler to

administer and for employees to understand. Almost all

of the PayForce are shareholders, which means everyone

is committed to our ongoing success.

New Sales

& Marketing

teams

50

%

2223
Gavin Thompson

Director (Non-Independent)

Gavin is a founder and director of

Catalyst IT, New Zealand’s largest

open-source IT service provider. His

background is in software development and delivery,

and he has over 30 years’ experience in software

systems in the manufacturing, engineering, financial,

and government sectors. Gavin is also a director on the

board of Catalyst Cloud, a company which grew from an

infrastructure platform for the Catalyst business into a

provider of cloud services for Aotearoa.

Gavin is passionate about open source and open

standards software and systems which allow a

collaborative and effective approach to delivering

secure, resilient and innovative solutions.

Michael "MOD" O'Donnell

Independent Director

Mike "MOD" O'Donnell is a professional

director, writer and advisor with a

background in FinTech, ecommerce and

news media.

MOD is chair of New Zealand’s largest craft brewery

Garage Project and deputy chair of both New Zealand

Trade and Enterprise and global online music company

Serato. MOD is also a director of Radio New Zealand,

www.realestate.co.nz, Sandfield Software and he is a

Trustee of The New Zealand Hi-Tech Trust.

MOD is an independent weekly business columnist for

Stuff Media and the host of TVNZ series "Start Me Up".

He was previously Chief Operating Officer of Trade Me,

Chief Operating Officer of vWork and Head of Wholesale

Investment at Gareth Morgan Investments.

Mark Samlal

Independent Director

Mark Samlal has over 25 years'

experience in growth leadership roles

in Asia Pacific. Most recently Mark co-

founded PayAsia in 2006 where he was Non-Executive

Chair, until being appointed as Executive Chair and

Managing Director of PayAsia in 2015. In 2017, Mark

was appointed to the Board and as Managing Director

of PayGroup which listed on the ASX in May 2018 and

PayAsia became a 100% subsidiary. During this time,

Mark strategically executed over five acquisitions

before being acquired by Deel Inc by way of scheme of

arrangement in November 2022 and delisted.

Mark remains the Founder of PayGroup and the General

Manager of Deel Inc Asia. Mark was also a Director and

General Manager of PayConnect Solutions that was

acquired by ADP. His previous senior roles include CEO

at Vicplas International Ltd, a Singapore Stock Exchange

listed company, as well as Executive Director of Omni

Industries in Singapore. Throughout all experience

mentioned, Mark was an invested shareholder.

Jim Sybertsma

Independent Director, Audit & Risk

Committee Chair

Jim has over 25 years of experience in

financial leadership positions including

CFO roles for DB Group, NZ Dairy Foods, Fliway Group,

and Hawkesby Management. During this time, Jim has

been involved in audit, compliance and corporate

finance activities across a range of industries and sizes

from start-up to scale-up.

Jim is currently a Director for Provident Insurance

Corporation Limited, Auto Drive Holdings and First Glass.

He is also CFO of Hawkesby Management, a family office

investment role managing multiple investments in early

stage tech companies and listed equity portfolios

Troy Tarrant

CTO & Co-Founder

Troy has over 20 years experience in

IT development, product design and

architecture - ten of those years focused

solely on HR and payroll applications. He's worked

on projects across the board, from small business

to government. He's built PaySauce to enable rapid

development, security and scale.

Mathew Stokes

COO

Mathew has a strong finance and

technology background and amplifies

this with his passion for innovation,

streamlining operations and enhancing customer

experiences. Mathew actively contributes to the

finance and technology sectors, providing invaluable

insights and guidance. He is regularly invited to speak

on international stages about his insights on technology

and customer operations at scale, and also ensures

that we run a tight ship on compliance and regulatory

requirements.

Jaime Monaghan

CFO

With an extensive commercial

background, Jaime brings incisive

leadership to our financial and strategic

planning. Jaime’s expertise in bringing business and

finance together was honed in her previous roles at

Trade Me and Kiwibank. A Scottish Accountant, Jaime is

dedicated to ensuring the best possible stewardship of

shareholders’ funds in the short, medium and long term.

PaySauce is responsible for managing a high volume

of funds on behalf of customers, with billions of dollars

being transacted every year through PaySauce systems.

Jaime’s financial acumen and excellent management is

key to overseeing this.

Jessica McLean

CPO

Jess has had a career that started with

hands-on customer service and payroll

consulting, then moved into people

& culture. She's now leading our people and product

functions at PaySauce, making sure we have both the

talent and the product strategies to propel PaySauce

forward. She's passionate about creating high-trust,

growth-supporting cultures and enabling high-

performing teams to do what they do best, as well as

the integral function that payroll plays in a business and

ensuring we help people get that right.

Jacques Labuschagne

Head of Delivery

Jacques is a seasoned expert in

delivering technology solutions for a

range of customers, including both

bespoke solutions as well as building successful suites

of core product and service offerings. With a career

that started in software development and moved

into team and project management, Jacques most

recently spent several years as the CEO of a technology

services business in the UK, then as the COO of the

NZ based business in the same group before joining

the PaySauce team in 2023. Using a blend of technical

expertise, strategic thinking and disciplined planning

and execution, he excels at managing technology teams

to deliver successful solutions.

Shelley Ruha

Independent Director and Chair

Shelley joined the PaySauce board in

February 2022. Shelley is a professional

director with strong governance

experience within FinTech, large scale technology

infrastructure, payments innovation, banking, wealth

management and venture capital.

Current governance roles include Chair of Allied Farmers

and directorships at Heartland Bank, 9Spokes and

Partners Life. Prior directorships include Paymark, The

Icehouse, Hobson Wealth, TaxGift and JBWere Australia.

Asantha Wijeyeratne

Executive Director, CEO and Co-

Founder

Asantha has over 20 years’ experience

of unparalleled focus on helping small

businesses navigate the difficult landscape of effective

payroll. His formal background in accounting combined

with his ‘people first’ attitude has seen him successfully

build a number of businesses into market leadership

positions.

Most notably, Asantha was the driving force behind the

creation and growth of SmartPayroll and SmartBooks

which he grew to service close to 10,000 SMEs in NZ

before he left in December 2013.

Asantha’s obsession is the small business sector with

a tech and customer service focus. He loves seeing

someone with determination and passion turn an idea

into a business that supports them, their families and

the wider community. He gets a lot of enjoyment from

making tech work to help business owners succeed.

In recognition of his contribution to business and the

community, he was awarded a Queens Service Medal

(QSM) in the New Year’s honours list in 2013 and was a

finalist in Ernst & Young’s 2021 Entrepreneur of the Year.

LEADERSHIP TEAM

Leadership team

We have ambitious goals, so we’ve built an

ambitious leadership team. They have the

talents, mindsets and skills to achieve our

goals, and will keep PaySauce on course as we

scale up for increased sustainable growth.

2425
PERFORMANCE fiSAAS METRICSflPERFORMANCE fiSAAS METRICSfl

PaySauce SaaS

Performance

Business Results

The business results and SaaS metrics reported in

the following sections provide an overview of the

performance of the business in a format that we

believe is useful for readers to assess the performance

of PaySauce as a SaaS business and should be read

alongside the consolidated financial statements and the

related notes in this report.

Non-Generally Accepted Accounting Principles (Non-

GAAP) measures have been included and should not be

viewed in isolation, nor considered as substitutes for

measures reported in accordance with New Zealand

Equivalents to International Financial Reporting

Standards (NZ IFRS).


MAR 2024 MAR 2023

$000s$000s

Processing Fees5,3704,592

Interest Income2,2001,123

Recurring Revenue7,5705,715

Cost to Serve(1,747)(1,569)

Gross Margin5,8234,146

Gross Margin %77%73%

Other Interest Income1515

Other Revenue13182

Total Other Revenue14697

Customer Acquisition

(766)(709)

Research & Development(934)(991)

General & Administration(3,108)(2,561)

Interest Expense(97)(62)

Earnings Before Tax, Depreciation and Amortisation 1,064(80)

Earnings Before Tax, Depreciation and Amortisation Margin %14%(1%)

Depreciation & Amortisation(646)(498)

Asset Impairment(228)-

Income Tax1,04220

Net Profit / (Loss)1,232(558)

Earnings Before Tax, Depreciation and Amor tisation (EBTDA) is calculated by adding back depreciation, amor tisation and income tax

expense to the amounts reported in the NZ IFRS-based financial statements. PaySauce believes that this measure provides useful

insights to measure the performance of PaySauce as a SaaS business.

EBTDA Margin % is EBTDA as a percentage of recurring revenue and is calculated by dividing EBTDA by recurring revenue

2627
PERFORMANCE fiSAAS METRICSflPERFORMANCE fiSAAS METRICSfl

PaySauce delivered its maiden net profit as it continued

to grow revenue and re-invest for long term growth in a

sustainable and deliberate manner.

EBTDA increased $1.14m year on year for March 2024

to $1.1m. This was driven primarily by the increase in

recurring revenue of $1.85m (33%) which more than

offset the $1.14m increase (18%) in expenditure. The net

profit for the year was $1.23m, up $1.79m on the net loss

of $558k of the prior year. The result includes a deferred

tax asset of $1.02m that was recognised during the year.

Recurring Revenue Earnings

$0.00 M

$0.50 M

-$0.50 M

-$1.00 M

-$1.50 M

-$2.00 M

Mar 21Mar 22Mar 23Mar 24

Free cash flow (excluding funds held on behalf of customers)

Free cash flow

(excluding funds held on behalf of customers)

Profitability

$8 M

$6 M

$4 M

$2 M

Mar 21Mar 22Mar 23Mar 24

RevenueExpenses

Profitability

Revenue* Expenses

*Revenue excludes recognition of deferred tax asset of $1.02m

Free cash flow is a non-GAAP financial measure that has

been included to demonstrate net cash generated by, and

invested into the business. PaySauce defines free cash

flow as cash flows generated from operating activities less

cash flows used for investing activities (excluding funds

held on behalf of customers).

Free cash flow increased by $0.94m year on year for

March 2024, primarily driven by an increase in net cash

from operating activities before increase in funds due

to customers and IRD of $1.21m.

Rule of 40

The rule of 40 provides a balanced measure of two key

metrics for SaaS businesses: growth and profitability.

PaySauce uses the combination of recurring revenue

growth, and EBTDA to assess against this measure.

A score of 40 is widely seen as the benchmark for SaaS

companies.

How and why do we monitor recurring revenue?

PaySauce monitors the revenue received from customers

as a growth metric. Looking at it from a customer journey

angle, this is the Average Revenue per User (ARPU) and

is derived by dividing the total recurring revenue by the

number of customers in a period. PaySauce measures this

metric on a monthly basis - the higher the ARPU, the more

value received from each customer.

Definitions

Recurring revenue is revenue that is expected to repeat into

the future. Recurring revenue for PaySauce consists of:

• Processing Fees - the monthly or annual subscription

customers pay for PaySauce payroll products.

• Interest Income - interest earned from funds held on

behalf of PaySauce customers. As interest earned on

these funds grows directly in relation to the number of

customers, this is considered an additional recurring

revenue stream.

Annualised recurring revenue (ARR) multiplies the recurring

revenue generated in the last month of the period by 12 to

annualise the current recurring revenue.

Recurring revenue grew 32% year on year to $7.6m. This

arose from increases in both processing fee revenue and

interest revenue.

Processing fee revenue increased to $5.37m, up 17%,

or $0.78m year on year. The increase in volume of

customers accounted for just over half of this increase,

while the increase in average revenue per customer

accounted for the remainder.

Interest revenue increased to $2.2m, up 96% or $1.08m

year on year. This was due to the increase in interest

rates, as well as an increase in the balance of funds held

on behalf of customers.

Annualised recurring revenue (ARR) grew 19% year on

year to $8m as at 31 March 2024.


MAR 2024MAR 2023YOY Change

ARR at end of period ($000s)8,0056,70119%

Recurring revenue for the period - Total ($000s)7,5705,71632%

ARPU (monthly) at end of period ($)918111%

FTEs464210%

Revenue per FTE ($000s)16813821%

InterestProcessing Fees

Annualised Recurring Revenue

Mar 21Mar 22Mar 23Mar 24

$0 M

$2 M

$4 M

$6 M

$8 M

Annualised recurring revenue


Interest


Processing fees

PaySauce has

surpassed the rule

of 40 benchmark

with annual recurring

revenue growing

+32% and an improved

EBTDA margin of +14%.

Exceed global benchmark

for SaaS companies

Rule of

40

2829
PERFORMANCE fiSAAS METRICSflPERFORMANCE fiSAAS METRICSfl

This enabled the customer support team to support a

greater number of customers, more effectively, with

the same headcount - evidenced by an NPS score of

58 at March 2024 (up 10 from 48 in March 2023). The

increase in cost to serve was largely inflationary, and

was outpaced by a 32% increase in recurring revenue,

of which a large portion of the increase was the result of

an increase in interest revenue. This led to an increased

gross margin of 77% for the year (up 4 percentage points

on last year).

MAR 2024MAR 2023YOY Change

Recurring revenue ($000s)

7,5705,71632%

Less cost to serve ($000s)

(1,747)(1,569)11%

Gross margin ($000s)5,8234,14640%

Gross margin %77%73%

4pp

Customer

Acquisition

PaySauce has continued its expansion outside of the

rural sector into new verticals, forming key partnerships

including Master Plumbers and Master Builders, as the

company prepares to deliver new digital marketing

campaigns in this space to increase brand awareness.

Accounting partners contribute to a large portion of

new customers and continue to be a focus as PaySauce

expands its network and deepens relationships with

existing accounting partners as well as bringing on new

ones.

MAR 2024MAR 2023*YOY Change

CAC per addition510413

24%

New customers1,5021,717

(13%)

Customer acquisition costs ($000s)766709

8%

Percentage of Recurring Revenue10%12%(2 pp)

* PaySauce changed the methodology in how it recognises customer activity during the period. As a result, the comparative period

metrics have been restated to equivalent values. The following metrics relating to Customer Acquisition were impacted:

-New customers increased f rom 1,417 to 1,717.

-CAC per addition decreased f rom $500 to $413.

Mar 21Mar 22Mar 23Mar 24

80%

75%

70%

65%

60%

Gross Margin %

Gross margin %

Mar 21Mar 22Mar 23Mar 24

30%

20%

10%

0%

Customer Acquisition as a % of Revenue

Customer acquisition as a % of revenue

How and why do we monitor cost to serve?

PaySauce monitors the cost of servicing customers as

an efficiency metric. The cost to serve per customer

(CTS) divides the total cost to serve by the total number

of customers for the period. The lower the CTS, the more

efficient PaySauce is at servicing customers.

Definitions

Cost to serve consists of customer support costs and

expenses such as cloud hosting, maintenance of our

software products, and bank fees charged per customer

transaction.


Gross margin represents our recurring revenue less the

cost to serve our customers, and is also often expressed

as a percentage, where the gross margin is divided by the

recurring revenue.

Cost to serve increased to $1.7m (up 11% on last year).

PaySauce continued to make investment into new

systems and tools to increase the efficiency of the

customer support team and set up the team for scalable

growth.

How and why do we monitor customer acquisition?

PaySauce monitors the cost of acquiring new customers

as an efficiency metric. The customer acquisition cost

(CAC) divides the total cost of acquisition across the new

customers for the period. Customer acquisition is more

efficient the lower the CAC per new customer metric.

Definitions

Customer acquisition costs relate to acquiring and

onboarding new customers. These consist of sales and

marketing people costs and expenses such as digital

marketing, events and sponsorship. These costs are

expensed as incurred as they do not relate to any specific

customer or contract for services.

PaySauce added more than 1,500 new customers during

the year (an increase of 7%) taking the total to 7,300

amid tough economic conditions, inflation and subdued

demand. While slower than originally anticipated,

Cost to Serve

3031
PERFORMANCE fiSAAS METRICSflPERFORMANCE fiSAAS METRICSfl

Research and development costs relate to building new

products and features as well as enhancing the current

products and infrastructure. These costs predominantly

consist of the software development team salaries, and

are either expensed or capitalised in line with NZ IFRS

requirements. Costs are expensed if they are primarily

related to researching new products or maintaining existing

products, and capitalised if they are related to developing

new and improving existing products. Development costs

are discussed in aggregate below - to demonstrate the

total spend on R&D for the business in the period before

capitalisation under NZ IFRS requirements.

PaySauce increased investment into research &

development by 25% year on year - up to $2.2m for

the year ended 31 March 2024. This included $0.2m of

development in progress which was written off during

the period as part of the impairment testing process.

Investment has primarily been made into additional

headcount as PaySauce, growing 50% year on year and

included several key hires that have led to improvements

both with the structure of the team, and the security

of the product. This is evidenced by an increase in

capitalisation rate to 56% up 7 percentage points year

on year, which is a measure of how much time is spent

developing and improving products compared to the

time spent maintaining them.

Our investment into additional headcount has resulted

in cost savings of our non-people, and outsourced

expenditure as we’ve built efficiencies to help manage

these costs as we scale our product and customer base.

R&D made up 29% of our Recurring Revenue, down 2

percentage points from last year.

General &

Administration

MAR 2024 MAR 2023YOY Change

Research & development expensed ($000s)934991

(6%)

Research & development impairment ($000s)228-

-

Research & development capitalised ($000s)1,066791

35%

Total research and development costs ($000s)2,2281,782

25%

Percentage of Recurring Revenue29%31%

(2pp)

Capitalisation rate56%49%

7pp

General and administration costs are the overhead related

costs of running the business which include management

remuneration, director fees, office running costs, finance

and administration, legal and consulting expenses and other

overheads

General and administration costs increased 21% year

on year to $3.1m though decreased as a percentage of

recurring revenue at 41% compared to 45% last year. The

increase was primarily driven by an increase in people

costs as a result of inflationary pressures and bringing

several team members in line with market rates.

MAR 2024MAR 2023YOY Change

Total general and administration costs ($000s)3,1082,561

21%

Percentage of Recurring Revenue41%45%

(4 pp)

G&A Cost as a % of Revenue

125%

100%

75%

50%

25%

Mar 21Mar 22Mar 23Mar 24

G&A cost as a % of revenue

Äу$ CaʄǶtalǶsatǶoɃ

Mar 21Mar 22Mar 23Mar 24

$2Ά00 M

$1Ά50 M

$1Ά00 M

$0Ά50 M

$0Ά00 M

R&D investment

Research &

Development

3233
PERFORMANCE fiSAAS METRICSflPERFORMANCE fiSAAS METRICSfl

Customer Lifetime

Value

Customer Lifetime

Journey

How and why do we monitor customer lifetime?

PaySauce monitors the retention of customers. This is

measured using the churn metric which calculates the

percentage of customers that stop using PaySauce products

each month. The lower the churn rate, the higher the derived

lifetime of each customer and the more value generated from

them. The customer lifetime value is assessed relative to the

customer acquisition cost (CAC) to determine the return on

investment of acquiring new customers.

Definitions

Monthly average churn rate is the 12 month average of the net

reduction of customers in a calendar month. This is expressed

as the percentage of the total Ccustomers at the star t of that

month. The estimated customer lifetime (in months) is derived

using the inverse of monthly average churn rate (being 1

divided by the monthly average churn rate).

Customer lifetime value (LTV) is a measure of the gross margin

each customer brings in over the time they use PaySauce. LTV

is calculated by multiplying the gross margin per customer by

the estimated customer lifetime.

Total customer LTV is a measure of the estimated value of the

current customer base, assuming that churn, revenue and

cost to serve remain constant. This measure is calculated by

multiplying customer LTV by the total number of customers.

LTV : CAC is a measure of the return on investment of acquiring

a new PaySauce customer. This measure is calculated by

dividing the customer LTV by the CAC per addition.

Tough economic pressures faced by customers during

the year, with high interest rates and inflation, has

provided a natural hedge for PaySauce. On one hand,

PaySauce saw average monthly churn increase to 1.18%,

a 3% increase year on year. On the other, PaySauce saw

an increase in interest revenue lead to an improved gross

margin of 77%, up 4 percentage points year on year.

On balance, this led to an increase in customer LTV to

$5,890 per customer, up 15% year on year.

This increase in customer LTV combined with the increase

in the number of PaySauce customers increased total

customer LTV by 23% year on year, growing to $43.4m as

at 31 March 2024.

Customer LTV is particularly sensitive to churn and assumes

these levels will remain consistent over an extended future

period. Using the average churn levels for the last three years

(1.16%), total customer LTV would be $0.9m (2%) higher.

CAC

$

510

24%


YOY

New customer

joins PaySauce

Customer

Acquisition (CAC)

$510 per customer

ARPU

$

91

Customer pays

a monthly

subscription

Recurring revenue

(Monthly): $91per

customer

11%


YOY

Customer

receives support

Cost to serve (CTS)

(Monthly): $21 per

customer

Customer stays

with PaySauce

Customer lifetime

Average monthly

churn of 1.18%

CTS

$

21

6% YOY

Customer

Lifetime

7

yrs

3% YOY

At 31 March 2024

Total customer

lifetime value

$

43.4m

23

% YOY

Customer

lifetime value

(CLTV)

$5,890 per

customer

CLTV

$

5,890

CLTV : CAC

12:1

Flat YOY

15% YOY

MAR 2024MAR 2023*YOY Change

Customers at end of period7,3686,875

7%

Average monthly churn rate for the period (%)1.181.15

3%

Churned customers1,009894

13%

LTV per customer at end of period ($)5,8905,142

15%

Total customer LTV at end of period ($000s)43,39935,348

23%

LTV:CAC ratio at end of period12 : 112 : 1

-

* PaySauce changed the methodology in how it recognises customer activity during the period. As a result, the comparative period

metrics have been restated to equivalent values. The following metrics relating to Customer Lifetime Value were impacted:

-Customer lifetime decreased f rom 11.1 years to 7.3 years

-Average monthly churn rate increased f rom 0.75 to 1.15%

-Churned customers increased f rom 594 to 894

-LTV per customer decreased f rom $7,817 to $5,142

-Total Customer LTV decreased f rom $53.7m to $35.4m

-LTV:CAC ratio decreased f rom 16 : 1 to 12 : 1.

3435
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Consolidated Financial

Statements

For the year ended 31 March 2024

Director’s Report 35

Independent Auditor’s Report 36

Consolidated Financial Statements

Consolidated Statement of Comprehensive Income 40

Consolidated Statement of Financial Position 41

Consolidated Statement of Movements in Equity 43

Consolidated Statement of Cash Flows 44

Notes to the Consolidated Financial Statements 45

Company Directory 82

Directors’ Report

The Board of Directors have pleasure in presenting the annual report of PaySauce Limited, incorporating the consolidated

financial statements and the independent auditor’s report, for the year ended 31 March 2024.

In the opinion of the directors of PaySauce Limited, the consolidated financial statements and notes on pages 40 to 64:

• comply with New Zealand Generally Accepted Accounting Practice (“NZ GAAP”) and present fairly the consolidated

financial position of the Group as at 31 March 2024 and the results of their operations and cash flows for the year

ended on that date; and

• have been prepared using appropriate accounting policies, which have been consistently applied and supported by

reasonable judgements and estimates.

The directors consider that they have taken adequate steps to safeguard the assets of the Group and to prevent

and detect fraud and other irregularities. Internal control procedures are also considered to be sufficient to provide

reasonable assurance as to the integrity and reliability of the consolidated financial statements.

For and on behalf of the Board of Directors:

Shelley Ruha Jim Sybertsma

Chair Chair of Audit & Risk Committee

21 May 2024 21 May 2024

3637
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Grant Thornton New Zealand Audit Limited

L4, Grant Thornton House

152 Fanshawe Street

PO Box 1961

Auckland 1140

T +64 (0)9 308 2570

www.grantthornton.co.nz

Independent

Auditor’s Report

To the Shareholders of PaySauce Limited

Report on the Audit of the

Consolidated Financial Statements

Opinion

We have audited the consolidated financial statements of PaySauce Limited (the “Company”) and its controlled

subsidiaries (“the Group”) on pages 40 to 64 which comprise the consolidated statement of financial position

as at 31 March 2024, and the consolidated statement of comprehensive income, consolidated statement

of movements in equity and consolidated statement of cash flows for the year then ended, and notes to the

consolidated financial statements, including the material accounting policy information.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the

financial position of the Group as at 31 March 2024 and its financial performance and cash flows for the year then

ended in accordance with New Zealand Equivalents to International Financial Reporting Standards (‘NZ IFRS’)

issued by the New Zealand Accounting Standards Board and International Financial Reporting Standards (“IFRS”).

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (New Zealand) (ISAs (NZ)) issued

by the New Zealand Auditing and Assurance Standards Board. Our responsibilities under those standards

are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

section of our report. We are independent of the Group in accordance with Professional and Ethical Standard

1 International Code of Ethics for Assurance Practitioners (including International Independence Standards)

(New Zealand) issued by the New Zealand Auditing and Assurance Standards Board and the International

Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including

International Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in

accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for our opinion.

Other than in our capacity as auditor we have no other relationship with, or interests in, the Company or any of its

subsidiaries.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit

of the consolidated financial statements of the current period. These matters were addressed in the context of

our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not

provide a separate opinion on these matters. We have determined the matters described below to be the key

audit matters to be communicated in our report.

Why the audit matter is significantHow our audit addressed the key audit matter

Intangible assets – Capitalisation of internally

developed software and impairment testing of

intangible assets not yet ready for use

Intangible assets carrying value of $2,399,000 at 31

March 2024 ($2,009,000 at 31 March 2023) is comprised

of computer software, development in progress and

customer relationships.

The Group is a Software as a Service (“SaaS”) provider

which incurs significant expenditure in developing and

maintaining its software assets.

NZ IAS 38 Intangible Assets outlines the criteria for

capitalisation of costs associated with developing the

software including whether the software will generate

future economic benefits

As disclosed in Note 5, capitalised software costs are

recognised at cost and subsequently amortised over

their estimated useful lives. Costs that do not meet the

criteria for capitalisation are expensed to profit or loss as

incurred.

In addition to the above, the software asset includes

development in progress. NZ IAS 36 Impairment of Assets

requires intangible assets that are not yet available for

use to be tested annually for impairment.

Capitalisation of internally generated intangible

assets and impairment testing of intangible assets

under development involves significant estimate and

judgement and therefore is also a key audit matter.

We evaluated the appropriateness of intangible asset

capitalisation and assessed impairment testing of

intangible assets.

In respect to capitalised intangible assets, our

procedures, amongst others, included the following:

• obtained an understanding of the nature and

background of the activities and costs that are

capitalised;

• reviewed a sample of projects and assessed

whether they met the capitalisation criteria in NZ

IAS 38 Intangible Assets; and

• agreed a sample of costs capitalised to sufficient

and audit evidence to ensure they were reasonable

and appropriate.

In respect to impairment assessments, our procedures,

amongst others, included the following:

• reviewed individual development projects for

indicators of impairment;

• performed procedures to evaluate and challenge

the Group’s determination of CGUs;

• obtained management’s impairment assessments

and tested the completeness and mathematical

accuracy of the value in use calculations;

• compared the forecast cash flows used for FY24

to the Board approved business plan;

• assessed managements historical accuracy in

cash flow forecasting; and

• used our internal valuation experts to assess the

models’ compliance with NZ IAS 36, and to review

the appropriateness of key assumptions.

Other procedures of note included the following:

• Reviewed disclosures in the consolidated

financial statements for reasonableness and

appropriateness.

3839
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Information Other than the Financial Statements and Auditor’s Report thereon

The Directors are responsible for the other information. The other information comprises the F24 highlights, F25 strategy,

leadership messages, delivering on the plan, leadership team, Performance (SaaS metrics), corporate governance,

company directory, the Directors’ report, and the corporate governance disclosures, but does not include the

consolidated financial statements and our auditor’s report thereon. Our opinion on the consolidated financial statements

does not cover the other information and we do not express any form of audit opinion or assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information

and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial

statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work

we have performed, we conclude that there is a material misstatement of this information, we are required to report that

fact. We have nothing to report in this regard.

Directors’ responsibilities for the Consolidated Financial Statements

The Directors are responsible on behalf of the Group for the preparation and fair presentation of the consolidated

financial statements in accordance with NZ IFRS issued by the New Zealand Accounting Standards Board and IFRS, and

for such internal control as the Directors determine is necessary to enable the preparation of consolidated financial

statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the directors are responsible on behalf of the Group for assessing

the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using

the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or

have no realistic alternative but to do so.

Auditor’s responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are

free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.

Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with

ISAs (NZ) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are

considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic

decisions of users taken on the basis of these consolidated financial statements.

A further description of the auditor’s responsibilities for the audit of the financial statements is located on the External

Reporting Board’s website at: https://www.xrb.govt.nz/standards/assurance-standards/auditors-responsibilities/

audit-report-1

Restriction on use of our report

This report is made solely to the Company’s shareholders, as a body. Our audit work has been undertaken so

that we might state to the Company’s shareholders, as a body those matters which we are required to state to

them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or

assume responsibility to anyone other than the Company and the Company’s shareholders, as a body, for our

audit work, for this report or for the opinion we have formed.

Grant Thornton New Zealand Audit Limited

B Smith, Partner

Auckland

21 May 2024

4041
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Consolidated Statement

of Comprehensive Income

For the year ended 31 March 2024

20242023

Notes$000s$000s

Operating revenue 87,7175,813

Expenses

Employee expenses

9

(4,470)(3,739)

Other expenses

12

(2,086)(2,092)

Depreciation and amortisation

4,5

(646)(498)

Asset impairment

5

(228)-

Finance costs

11

(97)(62)

Total expenses (7,527)(6,391)

Net profit / (loss) before income tax 190(578)

Tax benefit

13

1,04220

Net profit / (loss) for the period 1,232(558)

Other comprehensive income


--

Total comprehensive profit / (loss) for the period1,232(558)

Earnings / (loss) per shareCentsCents

Basic earnings / (loss) per share70.88(0.40)

Diluted earnings / (loss) per share70.88(0.40)

The above statement should be read in conjunction with the accompanying notes.

Consolidated Statement

of Financial Position

As at 31 March 2024

20242023

Notes$000s$000s

Assets

Current assets

Cash and cash equivalents

22

603504

Cash and cash equivalents - customer funds

22

8,9098,169

Term deposits - customer funds

22

24,70024,200

Trade receivables


173124

Other assets


500638

Total current assets 34,88533,635

Non‑current assets

Deferred tax asset

13

979-

Property, plant and equipment

4

371358

Intangible assets

5

2,3992,009

Total non‑current assets 3,7492,367

Total assets 38,63436,002

Liabilities

Current liabilities

Trade and other payables398627

Funds due to customers and IRD

22

33,60932,369

Employee benefits332372

Other liabilities


390346

Lease liabilities134114

Interest bearing liabilities

14

650-

Total current liabilities 35,51333,828

The above statement should be read in conjunction with the accompanying notes.

4243
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Consolidated Statement

of Financial Position

As at 31 March 2024

20242023

Notes$000s$000s

Non‑current liabilities

Lease liabilities77115

Employee benefits-14

Interest bearing liabilities

14

-650

Total non‑current liabilities 77779

Total liabilities 35,59034,607

Net assets 3,0441,395

Equity

Share capital

6

13,65913,212

Reserves

19

212242

Accumulated losses


(10,827)(12,059)

Equity attributable to the owners of the Company 3,0441,395

For and on behalf of the Board of Directors, who authorised the issue of these Consolidated Financial Statements on 21

May 2024:

Shelley Ruha Jim Sybertsma

Chair Chair of Audit & Risk Committee

21 May 2024 21 May 2024

The above statement should be read in conjunction with the accompanying notes.

Consolidated Statement

of Movements in Equity

For the year ended 31 March 2024

Attributable to equity holders of the Company


Share‑based

payment reserve

Share

Capital

Accumulated

losses

Total

Notes$000s$000s$000s$000s

Balance as at 1 April 2023 24213,212(12,059)1,395

Comprehensive profit

Net profit for the period--1,2321,232

Other comprehensive income----

Total comprehensive profit‑‑1,2321,232

Transactions with owners

Share-based payments, net of tax

19

211--211

Share-based payments paid up

6

(241)241--

Issue of ordinary shares

6

-206-206

Total transactions with owners(30)447‑417

Balance as at 31 March 202421213,659(10,827)3,044

Balance as at 1 April 2022 13113,039(11,502)1,668

Comprehensive loss

Net loss for the period--(557)(557)

Other comprehensive income----

Total comprehensive loss‑‑(557)(557)

Transactions with owners

Share-based payments, net of tax

19

257--257

Share-based payments paid up

6

(146)146--

Issue of ordinary shares

6

-27-27

Total transactions with owners111173‑284

Balance as at 31 March 202324213,212(12,059)1,395

The above statement should be read in conjunction with the accompanying notes.

4445
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Consolidated Statement

of Cash Flows

For the year ended 31 March 2024

20242023

Notes$000s$000s

Cash flows from operating activities

Receipts from customers5,0824,290

Interest received2,205970

Payments to suppliers and employees(5,803)(4,978)

Taxes refunded / (paid)13(13)

Interest paid on operating leases(22)(5)

Net cash from operating activities before increase in funds

due to customers and IRD

221,475264

Increase in funds due to customers and IRD

22

1,2405,031

Net cash from operating activities182,7155,295

Cash flows used in investing activities

Funds on term deposit(500)(6,475)

Investment in intangible assets(1,066)(791)

Purchases of property, plant and equipment


(113)(118)

Net cash used in investing activities (1,679)(7,384)

Cash flows from / (used in) financing activities

Loan advances


-650

Repayments of principal portion of lease liability


(122)(55)

Interest paid on borrowings


(75)(38)

Net cash (used in) / from financing activities (197)557

Net increase / (decrease) in cash and cash equivalents 839(1,532)

Cash and cash equivalents at beginning of the period


8,67310,205

Cash and cash equivalents at end of the period9,5128,673

The above statement should be read in conjunction with the accompanying notes.

Notes to the Consolidated Financial

Statements

For the year ended 31 March 2024

1. General information

PaySauce Limited (the "Company" or “PaySauce”), is a for-profit limited liability company, domiciled and incorporated in

New Zealand and registered under the Companies Act 1993. The company is an FMC Reporting Entity for the purpose of

the Financial Markets Conduct Act 2013. PaySauce is listed on the New Zealand Stock Exchange (“NZX”) that trades under

the ticker PYS.

PaySauce is a SaaS fintech platform providing solutions for people at work in 14 jurisdictions across the Asia-Pacific

region. The technology enables small employers to digitally onboard, pay and manage employees from any device.

The platform includes rosters, mobile timesheets, payroll calculations, banking integration, automated payments, PAYE

filing, labour costing, automated general ledger entries and digital employment contracts. The PayNow feature enables

customers’ employees to access the pay they’ve earned before payday, providing a free alternative to payday lenders.

The consolidated financial statements for the Company and its subsidiaries (the "Group") for the year ended 31 March

2024 were authorised in accordance with a resolution of the directors for issue on 21 May 2024 and are audited.

2. Summary of material accounting policies

a. Basis of preparation

These consolidated financial statements have been prepared:

• in accordance with New Zealand Generally Accepted Accounting Practice (“NZ GAAP”)

• in accordance with New Zealand equivalents to International Financial Reporting Standards (“NZ IFRS”) and other

applicable Financial Reporting Standards, as appropriate for profit oriented entities

• in accordance with International Financial Reporting Standards (“IFRS”)

• in accordance with the requirements of the Financial Markets Conduct Act 2013;

• on the basis of historical cost;

• in New Zealand dollars (NZD) with all values rounded to the nearest one thousand dollars ($1,000) unless otherwise

stated;

• on the assumption that the Group is a going concern.

There were no new standards, amendments or interpretations issued in the financial period which would materially impact

the financial statements.

b. Basis of consolidation

The Group financial statements incorporate the financial statements of the Company and its subsidiaries as at 31 March

2024. All subsidiaries are wholly owned and controlled by the Company as at 31 March 2024 and have a reporting date of

31 March 2024 (note 21).


All transactions and balances between the Group are eliminated on consolidation. Amounts reported in the financial

statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies

adopted by the Group.

4647
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

c. Foreign currency translation

Functional and presentation currency


Items included in the consolidated financial statements of the Group's entities are measured using the currency of the

primary economic environment in which the entity operates (New Zealand). The consolidated financial statements are

presented in New Zealand dollars ($), which is the Group's functional and presentation currency.

Transactions and balances


Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates

of the transactions or valuation where items are re-measured.

d. Goods and Services Tax (GST)

All revenue and expense transactions are recorded exclusive of GST. Assets and liabilities are similarly stated exclusive of

GST, with the exception of receivables and payables, which are stated inclusive of GST.

e. Leases

Payments associated with short-term leases and leases of low-value assets are recognised on a straight line basis as an

expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise

IT-equipment and small items of office furniture.

Lease liabilities are initially measured at the present value of the remaining lease payments, discounted at the Group’s

incremental borrowing rate. Subsequently, the carrying value of the liability is adjusted to reflect interest and lease

payments made.

PaySauce recognised a right-of-use asset and corresponding lease liability for the property lease entered into during the

period at 85 The Esplanade, Petone.

3. Use of critical accounting estimates and judgements

The preparation of the consolidated financial statements requires PaySauce to make a number of judgements, estimates

and assumptions. Estimates and underlying assumptions are reviewed on an on-going basis.

Information about critical judgements and significant estimates used in applying accounting policies that have the most

significant effect on the amounts recognised in the consolidated financial statements are included below and in the

following notes:

• Intangible Assets (Note 5)

• Tax Expense (Note 13)

Going concern

The consolidated financial statements have been prepared on a going concern basis.

The Group made a net profit before tax of $0.190 million for the year ended 31 March 2024 (2023: loss of $0.578 million),

has equity at 31 March 2024 of $3.044 million (2023: $1.395 million) and net current liabilities of $0.628 million (2023:

$0.193 million). The Group had positive operating cash flows before increase in funds due to customers and IRD of $1.475

million for the year ended 31 March 2024 (2023: $0.264 million). The Group also has additional debt facilities of $0.250

million to draw upon as required.

The Directors consider after making due enquiry and having regard to the circumstances which they consider reasonably

likely to affect the Group for the foreseeable future, which is not less than 12 months from the date these financial

statements are approved for issue, that the going concern assumption is valid.

4. Property, plant and equipment

Right‑of‑use

Asset (Property)

Office

Equipment

Leasehold

Improvements

Computer

Equipment

Total

Year ended 31 March 2024$000s$000s$000s$000s$000s

Opening net book value

22860466358

Additions

10445-67216

Disposals

-(1)-(3)(4)

Depreciation

(129)(18)(2)(50)

(199)

Closing net book value

20386280371

As at 31 March 2024

Cost

3421534242741

Accumulated depreciation

(139)(67)(2)(162)(370)

Net book value

20386280371

Right‑of‑use

Asset (Property)

Office

Equipment

Leasehold

Improvements

Computer

Equipment

Total

Year ended 31 March 2023$000s$000s$000s$000s$000s

Opening net book value

5830742137

Additions

23942472357

Disposals

-(1)-(5)(6)

Depreciation

(69)(11)(7)(43)

(130)

Closing net book value

22860466358

As at 31 March 2023

Cost

44112115224801

Accumulated depreciation

(213)(61)(11)(158)(443)

Net book value

22860466358

Items of computer, office equipment, leasehold improvements are measured at cost less accumulated depreciation and

accumulated impairment losses.

Cost includes expenditure that is directly attributable to the acquisition of the asset. Purchased software that is integral

to the functionality of the related equipment is capitalised as part of that equipment.

Any gain or loss on disposal of an item of property, plant and equipment is recognised in profit or loss within the Statement

of Comprehensive Income.

4849
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Depreciation is recognised in profit or loss on a straight line basis over the estimated useful lives of each item of

equipment. The depreciation rates for the current and comparative years of significant items of property, plant and

equipment are as follows:

Right-of-use asset 20 - 50%

Office equipment 8.5 - 67%

Leasehold improvements 50%

Computer equipment 40%

Depreciation methods, useful lives and residual values are reviewed at each reporting period and adjusted if appropriate.

The carrying values of property, plant and equipment are reviewed annually for impairment when events or changes in

circumstances indicate the carrying value may not be recoverable.

5. Intangible assets

Development in

progress

Computer

Software

Customer

Relationships

Total

Year ended 31 March 2024$000s$000s$000s$000s

Opening net book value

7999862242,009

Additions5226-78

Development costs recognised as an asset988--988

Development in progress recognised as Software(639)639--

Asset impairment(228)--(228)

Amortisation-(377)(71)(448)

Closing net book value9721,2741532,399

As at 31 March 2024

Cost9722,6283543,954

Accumulated amortisation-(1,354)(201)(1,555)

Net book value9721,2741532,399

Development in

progress

Computer

Software

Customer

Relationships

Total

Year ended 31 March 2023$000s$000s$000s$000s

Opening net book value4008912951,586

Additions14339-182

Development costs recognised as an asset57138-609

Development in progress recognised as Software(315)315--

Amortisation-(297)(71)(368)

Closing net book value7999862242,009

As at 31 March 2023

Cost

7992,0763543,229

Accumulated amortisation-(1,090)(130)(1,220)

Net book value7999862242,009

Finite life intangible assets

Acquired computer software licences and costs associated with developing computer software are capitalised on the

basis of the costs incurred to acquire and bring the specific software into use. All intangible assets of PaySauce are finite

life intangible assets.

Development expenditure initially recognised as an expense is not recognised as an asset in subsequent periods.

Costs associated with maintaining computer software programs are recognised as an expense as incurred. Where

development activities result in the replacement of previously capitalised functionality, the associated development

costs are classified as maintenance activity and accordingly expensed.

Developed and acquired software is measured at cost less accumulated amortisation and impairment losses, if any.

Amortisation is recognised in the Statement of Comprehensive Income on a straight-line basis over 5 years.

Key estimates and judgements

Capitalisation of intangible assets

Management considers the time and associated salary cost of development staff to fall under the classification of

development expenditure for assessment purposes in accordance with the principles outlined below. No indirect people

costs, nor weighting of overheads is applied in these calculations.

Development expenditure is capitalised if, and only if the Group can demonstrate all of the following:

• its ability to measure reliably the expenditure attributable to the asset under development;

• the product or process is technically and commercially feasible;

• its future economic benefits are probable;

• its ability to use or sell the developed asset; and

• the availability of adequate technical, financial and other resources to complete the asset under development.

5051
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Accounting for finite life intangible assets

At each reporting date, the useful lives and residual values of finite life intangible assets are reviewed for indicators of

impairment. As at 31 March 2024, the assets were assessed for indicators of impairment, taking into account the condition

of the assets, expected period of use of the assets by the Group, and expected disposal proceeds from any future sale of

the assets. Management’s assessment concluded that there were no indicators of impairment.

Development in progress has been tested for impairment by reviewing the nature of the events that originally gave rise

to the recognition of the asset, the estimation of future generation of cash flows and any anticipated changes to the

business or product circumstances.

Indicators of impairment were identified for development in progress assets during the year, with some assets in this

category no longer expected to be completed. Upon assessment of the recoverable amount of the Development in

progress assets, it was determined that an impairment loss of $0.228 million be recognised.

6. Share capital

DateDetailsNotesNumber of Shares$000s

1 April 2023Opening Balance139,207,93513,212

Issue of ordinary shares(a)359,84591

Share based payment(b)100,00025

Issue of ordinary shares(c)431,647106

Share based payment(d)43,36510

Issue of ordinary shares(e)284,43565

Issue of ordinary shares(f)230,91366

Issue of ordinary shares(g)324,00684

31 March 2024Closing Balance140,982,14613,659

DateDetailsNotesNumber of Shares$000s

1 April 2022Opening Balance138,583,81913,039

Issue of ordinary shares(h)273,24474

Share based payment(i)98,46027

Issue of ordinary shares( j)252,41272

31 March 2023Closing Balance139,207,93513,212

Fully paid up, ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary

shares are recognised as a deduction from equity, net of any tax effects.

(a) On 31 May 2023: Shares issued (unpaid) as part of the FY23 employee share scheme were paid up as tranche 1 of the

scheme vested for those employees who met the vesting conditions. 359,845 shares were fully paid up via a discretionary

bonus approved by the board. This resulted in an issue of 359,845 ordinary shares at $0.2596 per share, totalling an issue

of $0.094m. Directly attributable costs totalled $0.003m, bringing the net share issue to $0.091m.

(b) On 30 November 2023: Shares were issued to an employee as a sign-on bonus. This resulted in an issue of 100,000

ordinary shares being issued at a price of $0.2492 per share, satisfying remuneration arrangements to the value of

$0.025m expensed in the consolidated statement of comprehensive income.

(c) On 30 November 2023: Shares were issued and paid up for both Q1 and Q2 of the FY24 employee share scheme.

This resulted in an issue of 431,647 ordinary shares at $0.2492 per share, totalling an issue of $0.106m.

(d) On 31 January 2024: PaySauce issued ordinary shares to remunerate a director. There was no vesting period. The

allotment resulted in 43,365 shares being issued at a price of $0.2306 per share, satisfying remuneration arrangements to

the value of $0.010m expensed in the consolidated statement of comprehensive income.

(e) On 31 January 2024: Shares were issued and paid up for Q3 of the FY24 employee share scheme. This resulted in an

issue of 284,435 ordinary shares at $0.2306 per share, totalling an issue of $0.065m.

(f ) On 31 March 2024: Shares issued (unpaid) as part of the FY22 employee share scheme were paid up as tranche

3 of the scheme vested for those employees who met the vesting conditions. 230,913 shares were fully paid up via a

discretionary bonus approved by the board. This resulted in an issue of 230,913 ordinary shares at $0.2842 per share,

totalling an issue of $0.066m.

(g) On 31 March 2024: Shares issued (unpaid) as part of the FY23 employee share scheme were paid up as tranche

2 of the scheme vested for those employees who met the vesting conditions. 324,006 shares were fully paid up via a

discretionary bonus approved by the board. This resulted in an issue of 324,006 ordinary shares at $0.2596 per share,

totalling an issue of $0.084m.

(h) On 31 May 2022: Shares issued (unpaid) as part of the FY22 employee share scheme were paid up as tranche 1 of the

scheme vested for those employees who met the vesting conditions. 273,244 shares were fully paid up via a discretionary

bonus approved by the board. This resulted in an issue of 273,244 ordinary shares at $0.2842 per share, totalling an issue

of $0.078m. Directly attributable costs totalled $0.004m, bringing the net share issue to $0.074m.

(i) On 28 February 2023: PaySauce issued ordinary shares to remunerate and align the interests of a new director with

PaySauce shareholders ahead of their formal appointment to the Board. There was no vesting period, and the shares were

issued subject to the Director continuing to hold office until voted in by shareholders at the Annual Shareholders Meeting.

The allotment on 28 February 2023 resulted in 98,460 shares being issued at a price of $0.2694 per share, satisfying

remuneration arrangements to the value of $0.027m expensed in the consolidated statement of comprehensive income.


( j) On 31 March 2023: Shares issued (unpaid) as part of the FY23 employee share scheme were paid up as tranche

2 of the scheme vested for those employees who met the vesting conditions. 252,412 shares were fully paid up via a

discretionary bonus approved by the board. This resulted in an issue of 252,412 ordinary shares at $0.2842 per share,

totalling an issue of $0.072m.

Dividends

No dividends were declared or paid during the reporting period (2023: None).

Capital Risk Management

The Group considers its capital to comprise its fully paid up, ordinary share capital and accumulated retained earnings.

When managing capital, management's objective is to achieve optimal long term capital returns to shareholders and

benefits for other stakeholders. Management also aims to maintain a capital structure that ensures the lowest cost of

capital available to the Group.

5253
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

7. Earnings per share

20242023

Basic earnings per share

Net profit / (loss) used in calculating earnings per share ($000s)1,232(557)

Weighted average number of ordinary shares for basic earnings per share139,739,655138,434,287

Basic earning / (loss) per share (cents)0.88(0.40)

There are no financial instruments on issue that will dilute the basic earnings per share amounts for the year ended 31

March 2024.

Basic earnings per share is calculated by dividing the profit / (loss) attributable to equity holders of the Company by the

weighted average number of fully paid up ordinary shares on issue during the period.

8. Operating revenue

20242023

$000s$000s

Revenue from contracts with customers

-Processing fees5,3704,592

-Other services revenue6465

Revenue from other sources

-Interest income2,2201,139

-Other revenue6317

Total operating revenue7,7175,813

There are no significant estimates or judgements surrounding recognition of revenue.

Revenue from contracts with customers

Processing fees

Revenue from processing fees includes both fixed and incremental components based on the number of employees and

pays processed for the customer. Revenue is recognised at the point in time the service is provided, which is when the

customer’s payroll has been processed.

Other services revenue

Revenue from sales of digital contracts are recognised when the customer has used the service. Revenue is recognised

at the point in time the service is provided, which is when the customer uses the contract builder application.

Revenue from other sources

Interest income

Interest income is earned on all funds held on behalf of customers, including net wages payable to customers’

employees and PAYE and other deductions payable to the IRD. The interest earned on these customers’ funds is

determined to be operating revenue by the Group. Interest income is accrued using the effective interest rate method.

Other revenue

Other revenue is recognised upon completion of services at a point in time.

9. Employee expenses

20242023

$000s$000s

Employee benefits/entitlements3,7123,251

Employee benefits/entitlements - share based payments582355

Fringe benefit tax2219

Other employee expenses154114

Total employee expenses4,4703,739

Short term employee benefit obligations are measured on an undiscounted basis and are expensed as the related

service is provided.

5455
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

10. Research & Development

20242023

$000s$000s

Research & development costs expensed

(included in note 9 - Employee expenses under Employee benefits/entitlements,

and note 12 - Other expenses under

Infrastructure and security)934991

Total research & development934991

11. Finance Costs

20242023

$000s$000s

Interest paid7557

Finance cost - Interest on lease225

Total finance costs9762

12. Other expenses

20242023

$000s$000s

Advertising, PR and marketing256255

Audit fees7970

Communications and subscriptions302239

Customer and transactional550489

Other overheads538514

Infrastructure and security250429

Travel11196

Total other expenses2,0862,092

The allocation of other expenses has been simplified due to the size and nature of the categories presented. The

disclosure for the year ended 31 March 2023 has also changed from what was presented in the group financial statements

to align the comparative period disclosure with the newly created categories. The change in disclosure does not impact

the reporting results of operations, for the categories presented on the face of the financial statements.

A provision for other overheads of $108k was released to the statement of comprehensive income during the period. The

provision was released as directors no longer believe the cost will be incurred.

13. Tax expense & deferred tax

20242023

(a) Income tax$000s$000s

Net profit / (loss) before tax for the period190(578)

At the New Zealand statutory income tax rate of 28%53(161)

Non-deductible expenditure (permanent differences)4227

Prior period adjustments (temporary differences)18112

Recognition/(utilisation) of tax losses(113)22

Deferred tax adjustments

- Reversal of temporary differences2020

-Recognition of tax losses carried forward as deferred tax asset1,022-

Income tax benefit1,04220

(b) Deferred tax assets / (liabilities)

Opening net deferred tax asset / (liability)(62)(82)

Recognised in profit of loss

- Unused tax losses1,022-

-Intangible assets2020

Closing net deferred tax assets / (liabilities)979(62)

Deferred tax assets1,022‑

Deferred tax liabilities(43)(62)

Tax expense comprises current and deferred tax. Current tax and deferred tax is recognised in profit or loss except to the

extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income.


Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for

financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for:

• temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business

combination and that affects neither accounting nor taxable profit or loss;

• temporary differences related to investments in subsidiaries and jointly controlled entities to the extent that it is

probable that they will not reverse in the foreseeable future; and

• taxable temporary differences arising on the initial recognition of goodwill.

The Group has recognised deferred tax assets in accordance with the key estimates and judgements below.

Key estimates and judgements

The Group holds tax losses of $8.523 million as at 31 March 2024 (2023: $8.926 million) available to carry forward, subject

to shareholder and business continuity being maintained. Deferred tax assets are only recognised to the extent that it is

probable that future taxable profits will be available to use against the asset. These are reviewed at each reporting period

and adjusted if appropriate. Management has assessed that tax losses of $3.651 million be recognised as deferred tax

assets as at 31 March 2024. Tax losses carried forward but not yet recognised as deferred tax assets therefore total

$4.833 million as at 31 March 2024.

5657
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

14. Interest bearing liabilities

The Group entered into a revenue based funding agreement with BNZ for $0.65m on 26 April 2022, which was drawn

down on 20 June 2022. The repayment terms are interest only, starting on 20th July 2022 and continuing until 20 June

2024. Repayment of the principal is also due on 20 June 2024.

The Group is required to maintain an Annual Recurring Revenue growth rate of at least 20% p.a. over the term of the

facility, tested at the end of each financial quarter. The funding is also provided on the basis that no dividend be paid out

during the term of the facility.

The loan is secured over all present and acquired property of the Group.

As at 31 March 2024 the loan carries an interest rate of 11.47% fixed for the period of the loan.

20242023

$000s$000s

BNZ Term Loan650650

Total interest bearing liabilities650650

15. Key management personnel and related parties

Key management personnel compensation

Key management personnel are defined as those persons having authority and responsibility for planning,

directing and controlling the activities of the Group, directly or indirectly and include the Directors, the

Chief Executive Officer and the Executive Leadership Team.


The table below summarises remuneration paid to key management personnel.

20242023

$000s$000s

Directors’ fees191152

Short term employee benefits1,128876

Share-based payments303131

Total key management personnel compensation1,6221,159

Related party transactions and balances

A number of key management personnel, or their related parties, hold positions in other entities that result in them

having control or significant influence over the financial or operating policies of those entities. A number of those entities

subscribe to services provided by the Group. None of the related party transactions are significant to either party.

Outside of these transactions, and the Directors’ fees and short term employee benefits noted above, all other related

party transactions are outlined below:

20242023

Related party transactions during the period$000s$000s

Cloud hosting services supplied by entities controlled by related parties

Catalyst Cloud Limited101113

20242023

Related party balances payable at period end$000s$000s

Directors' Fees3612

Cloud Hosting Services411

20242023

Related party balances receivable at period end$000s$000s

Prepaid Directors’ Fees

-20

PaySauce Limited has a standby debt facility agreement with Director Gavin Thompson. The facility totals $0.25M and

can be drawn on demand, within three years from the date of the agreement (December 2021). The interest rate in the

agreement is linked to the floating interest rate of ASB Bank Limited. As at 31 March 2024, no funds have been drawn.

16. Financial instruments

The Group’s financial assets mainly comprise of Cash and Cash Equivalents and Term Deposits. Cash and Cash

Equivalents is comprised of cash on hand. Term Deposits are measured at amortised cost. Cash and Cash Equivalents

and Term Deposits includes funds collected from customers as a PAYE intermediary (note 22).

Classification and measurement of financial liabilities

The Group’s financial liabilities include trade and other payables, funds due to customers and IRD, other liabilities

(including an overdraft facility used to operate our BNZ PayNow feature), and interest bearing liabilities.

Financial liabilities are initially measured at fair value, and, where applicable, adjusted for transaction costs.

Subsequently, financial liabilities are measured at amortised cost using the effective interest method.

5859
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Categories of Financial Assets & Liabilities

The carrying amounts presented in the statement of financial position relate to the following categories of assets and

liabilities.

20242023

Financial assets$000s$000s

Financial assets at amortised cost

Cash and cash equivalents603504

Cash and cash equivalents - customer funds8,9098,169

Term deposits24,70024,200

Trade and other receivables173124

Total financial assets34,38532,997

20242023

Financial liabilities$000s$000s

Financial liabilities at amortised cost

Funds due to customers and IRD33,60932,369

Trade and other payables321574

Other liabilities390346

Interest bearing liabilities650650

Total financial liabilities34,97033,939


The Group is exposed to a variety of financial risks. The financial risks arise from the business activities of the Group. The

specific financial risks that the Group is exposed to are discussed below.

1. Credit risk

As a SaaS business with minimal credit exposure, credit risk is relatively low relating to revenue received from customers

and any associated trade receivables. For other financial assets (including cash and bank balances), the Group minimises

credit risk by dealing exclusively with high credit rating counterparties.

(i) Credit risk concentration profile

The Group manages credit risk by placing its cash and short term investments with high quality financial institutions. The

majority of the Cash and Cash Equivalents are held with ASB Bank, BNZ and Kiwibank, which hold the following credit

ratings:

Credit Ratings Standard &

Poors Rating

Fitch

Rating

Moody's

Rating

ASB BankAA-A+A1

BNZAA-A+A1

KiwibankNot ratedAAA1

(ii) Exposure to credit risk

As the Group does not hold any collateral, the maximum exposure to credit risk is represented by the carrying amount of

the financial assets as at the end of the reporting period.

2. Liquidity risk

Liquidity risk arises mainly from business activities. The Group manages liquidity risk by ensuring cash flow is planned

ahead of time, and funding is planned and organised when required, to ensure the Group will be able to meet its financial

obligations. The following table sets out the maturity profile of the financial liabilities as at the end of the reporting period

based on contractual undiscounted cash flows (including interest payment computed using contractual rates or, if

floating, based on the rate at the end of the reporting period):

Carrying

amount

Total0‑6

months

7‑12

months

1‑ 2

years

2‑5

years

Year ended 31 March 2024$000s$000s$000s$000s$000s$000s

Funds due to customers and IRD33,60933,60933,609---

Trade and other payables321321321---

Other liabilities390390390---

Lease liabilities21221270634237

Interest bearing liabilities650662662---

Total35,18235,19435,052634237

Carrying

amount

Total0‑6

months

7‑12

months

1‑2

years

2‑5

years

Year ended 31 March 2023$000s$000s$000s$000s$000s$000s

Funds due to customers and IRD32,36932,36932,369---

Trade and other payables574574574---

Other liabilities346346346---

Lease liabilities2302536666121-

Interest bearing liabilities6507363737662-

Total34,16934,27833,392103783‑

6061
FINANCIAL STATEMENTSFINANCIAL STATEMENTSFINANCIAL STATEMENTS

3. Interest rate risk

PaySauce’s interest rate risk arises from the interest that it earns from its cash and cash equivalents. These funds are

subject to variable interest rates that expose PaySauce to cash flow interest risk rate. PaySauce does not currently use

any derivative products to manage interest rate risk.

As at balance date, none of the funds held in term deposits were subject to interest periods of greater than 12 months.

An analysis of the sensitivity of the Group’s earnings due to movements in interest rates is shown below:

20242023

Effect on net profit before tax$000s$000s

Cash and cash equivalents and term deposits

Each 100 basis point increase in interest rate335304

Each 100 basis point decrease in interest rate(335)(304)

The above information is calculated by applying the effective movement to the average balance of cash and cash

equivalents, term deposits, and interest bearing liabilities. Cash and cash equivalents and Term Deposits totalled $34.21

million as at 31 March 2024 (2023: $32.87 million). Interest bearing liabilities totalled $0.65 million as at 31 March 2024

(2023: $0.65 million) are not sensitive to interest rate changes as the interest rate is fixed.

17. Fair values of financial assets and liabilities

The carrying values of short term financial assets and liabilities approximate their fair values. Short term financial assets

include cash, trade and other receivables and related party receivables.

18. Reconciliation of net profit after tax to net cash flows from operations

20242023

$000s$000s

Net profit / (loss) after taxation1,232(557)

Add back non‑cash & non‑operating items:

Depreciation & amortisation646498

Asset impairments & loss on disposal of fixed assets2325

Share based payment expense418283

Other non-cash & non-operating items(948)19

1,580248

Movement in working capital:

Increase in Trade and other receivables(49)(42)

(Increase)/decrease in Other assets182(246)

Increase in Funds due to customers and IRD1,2405,031

Increase/(decrease) in Trade and other payables(229)172

Increase/(decrease) in Employee benefits (54)78

Increase in Other liabilities4554

Net cash inflow from operating activities2,7155,295

19. Employee Share Scheme

FY22 & FY23 Schemes

The Employee Share Schemes for FY22 and FY23 each consisted of 3 tranches, which vested over three years. The third

tranche of the FY22 scheme and the second tranche of the FY23 scheme vested on 31 March 2024. The shares were

originally issued unpaid to members of staff (ESS shares), In March 2024, a discretionary bonus was paid to all staff

remaining in those schemes for the value of vested shares, with deductions including PAYE deducted and paid to the

IRD on behalf of the staff. The net wages were then used to pay up the ESS shares, thereby converting them to fully paid

up ordinary shares. The remaining ESS shares (being the value of the deductions) remain vested, but not paid up. For

accounting purposes, the pool of ESS shares which have vested, but remain unpaid are accounted for in the same way as

options since the employee has the option to pay up the remaining unpaid ESS shares at the strike price. The fair value of

these unpaid ESS shares is not material. The scheme is expensed over the period that the employee receives the benefit,

with the equity settled transactions measured at fair value on the date they were issued.

FY 24 Scheme

The Group also entered into an employee share scheme for the year ended 31 March 2024. The new FY24 scheme differs

from the FY22 and FY23 schemes outlined above, as follows:

An ESS agreement is entered into between each eligible employee and the Company stipulating the value of fully paid

up ordinary shares granted. Shares are issued quarterly, at the end of each quarter, and the number of shares granted is

determined by the volume weighted average share price on each issue date.

6263
FINANCIAL STATEMENTSFINANCIAL STATEMENTSFINANCIAL STATEMENTS

New ESS agreements may be entered into throughout the course of the financial year for new employees as they

become eligible, with the benefit pro-rated for the proportion of the year those employees are eligible from. Equally,

employees who leave or become ineligible for the scheme will forfeit their right to be issued shares as part of the ESS

agreement.

Shares are performance based on the achievement of the employees personal KPI objectives.

This equity settled remuneration attracts income tax on the employees. The income tax and other deductibles are

deducted and the net amount of ordinary shares are issued to employees.

Employee share scheme expenses for the year ended 31 March 2024 are as follows:

Employee share scheme expenses

March 2024

Employee

Share Scheme

March 2023

Employee

Share Scheme

March 2022

Employee

Share Scheme

Total

For the period ended 31 March 2024$000s$000s$000s$000s

Share based payment expense, net of tax2867021377

Tax on share based payment expense1563712205

Total share based payment expense44210733582

March 2024

Employee

Share Scheme

March 2023

Employee

Share Scheme

March 2022

Employee

Share Scheme

Total

For the period ended 31 March 2023$000s$000s$000s$000s

Share based payment expense, net of tax-17860238

Tax on share based payment expense-8532117

Total share based payment expense‑26392355

The share based payment reserve is used to record the accumulated value of unvested shares and share options that

remain exercisable.

Share‑based payment reserve$000s

Balance at 1 April 2023242

Employee Share Scheme (F22) - Share based payment expense, net of tax 21

Employee Share Scheme (F23) - Shares vested and fully paid up(66)

Employee Share Scheme (F23) - Share based payment expense, net of tax70

Employee Share Scheme (F23) - Shares vested and fully paid up(178)

Employee Share Scheme (F24) - Share based payment expense, net of tax 286

Employee Share Scheme (F24) - Shares vested and fully paid up(173)

Other share based payment expenses, net of tax10

Balance at 31 March 2024212

Share based payment reserve$000s

Balance at 1 April 2022131

Employee Share Scheme (F22) - Share based payment expense, net of tax 67

Employee Share Scheme (F22) - Shares vested and fully paid up(134)

Employee Share Scheme (F23) - Share based payment expense, net of tax 178

Balance at 31 March 2023242

There is a liability associated with share based payments that have vested or been earned by employees, for the income

tax and other deductibles that are deducted by PaySauce on each employee’s behalf when shares are paid up. These

liabilities are accrued based on an estimate of the value of the future income tax and other deductibles for the individuals

based on their current marginal tax rates. The accrued liability at balance date was as follows:

20242023

Share‑based payment liabilities$000s$000s

Current9194

Non-current-13

Total share‑based payment liabilities91107

The employee liabilities in the consolidated statement of financial position also include other employee entitlements

such as accrued leave.

20. Segment reporting

The Group is organised into one reportable operating segment only, being SaaS based employment and payment

solutions for people at work in 14 jurisdictions across the Asia-Pacific region, primarily within New Zealand. Providing

employers the technology to digitally onboard, pay and manage employees from any device. The PaySauce platform

includes rosters, mobile timesheets, payroll calculations, banking integration, automated payments, PAYE filing, labour

costing, automated general ledger entries and digital employment contracts. The chief operating decision maker has

been identified as the Board of Directors, as it makes all key strategic resource allocation decisions (such as those

concerning acquisition, divestment and significant capital expenditure).

Overseas revenue earned is not material and no separate geographical segment has been reported.

6465
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

21. Investments in subsidiary

The Company had the following subsidiaries at 31 March 2024:

Entity NameDate of

incorporation

Nature of

business

Equity

held (%)

Value

held ($)

Country of

incorporation

Balance

date

PaySauce Operations

Limited

07/01/2015SaaS

Employment

Solutions

100309,278New Zealand31 March

Right Remuneration

Limited

22/01/2015PAYE

Intermediary

100-New Zealand31 March

Payroll.Kiwi Limited01/08/2017Employee

Share Scheme

Bare Trustee

100-New Zealand31 March

PaySauce Pty Limited08/02/2023SaaS

Employment

Solutions

100-Australia31 March

Only PaySauce Operations Limited, Right Remuneration Limited and PaySauce Pty Limited are consolidated in these

consolidated financial statements, as Payroll.Kiwi Limited is a non-trading company.

22. Funds due to customers and IRD

As a PAYE intermediary, PaySauce collects funds from clients which are payable to both clients’ employees (as the

employees’ net wages and salaries) and the IRD (as the applicable PAYE, student loan and other IRD liabilities). These

funds are included in PaySauce’s cash and term deposit balances and in accordance with section RP6 of the Income Tax

Act 2007, PaySauce can earn interest on these funds, but the funds must only be used as follows:

• Payment of net salary or wages to employees of PaySauce’s clients.

• Payment of IRD obligations resulting from pays run on PaySauce software to the IRD, including PAYE deductions,

student loan deductions, superannuation contributions and any other amount of tax withheld from a payment of

salary or wages to IRD.

Under the financial reporting standards movements in these funds do not meet the definition of either investing or

financing activities and so must be classified as operating cash flows. However as stated above the use of these funds is

restricted and they cannot be used to cover other PaySauce expenses, the company has therefore presented operating

cash flows in the Cash Flow Statement as both before and after this movement in funds. The value of restricted funds at

reporting date is represented by funds due to customers and IRD as disclosed in the Statement of Financial Position.

23. Contingencies

As at 31 March 2024 the Group had no contingent liabilities or assets (2023: $nil)

24. Events occurring after the reporting period

No adjusting or significant non-adjusting events have occurred between the reporting date and the date of authorisation.

6667
CORPORATE GOVERNANCECORPORATE GOVERNANCE

Corporate

Governance

Strong corporate governance protects the Company and as a

result our shareholders, customers, staff, and stakeholders. Our

approach to the recommendations outlined in the NZX Corporate

Governance Code (the Code) are set out below.

This section is structured around the principles detailed in the Code, and explains how PaySauce is

applying the Code’s recommendations. PaySauce documents referred to in this section are also

available online at https://www.paysauce.com/investor/

The Board considers that, as at 21 May 2024, the Company complied with the recommendations

set by the NZX Corporate Governance Code dated 1 April 2023, unless stated in the sections

outlined below, or in PaySauce’s Corporate Governance Code.

Principle 1 – Code of ethical behaviour

“Directors should set high standards of ethical behaviour, model this behaviour

and hold management accountable for these standards being followed

throughout the organisation.”

Code of ethics

Our code of ethics exists to help our directors, senior management, and employees with not just doing well, but doing

good.

This sets the standard of conduct for all our people. It's intended to support decision-making that aligns with PaySauce's

values, business goals, and legal and policy obligations. The board approves the code of ethics, which covers:

• conflicts of interest

• accepting gifts or benefits

• protecting company assets

• complying with laws and policies

• maintaining confidentiality

• valuing personnel

• transparency

All new directors and employees receive a copy of the code of ethics.

Securities trading policy

PaySauce respects the integrity of New Zealand’s financial markets and insider trading laws. Our securities trading policy

outlines how those laws apply, and the rules we've put in place to help ensure our people follow the law.

Directors, certain employees, and related parties need approval from PaySauce to trade in the company’s shares. Trading

is limited to defined “trading windows”.


The directors’ shareholdings and trading of shares during the year by the directors is published under Directors’

disclosures. A director or senior manager must advise the NZX promptly if they trade in the company’s shares.

Principle 2 – Board composition and performance

“To ensure an effective board, there should be a balance of independence, skills,

knowledge, experience”

The board of directors

The directors are responsible for the corporate governance practices of the company. The board's practices are detailed

in the Company’s corporate governance code, which lays out protocols for board operations.

This code complies with the relevant recommendations in the NZX Corporate Governance Code, and is reviewed

annually.

The board’s primary role is to represent and promote the interests of shareholders, ultimately adding long-term value to

the company’s shares.

6869
CORPORATE GOVERNANCECORPORATE GOVERNANCE

The board carries out its responsibilities according to the following mandate.

• the Board shall have a minimum number of three directors and a maximum of 10;

• the Board shall have at least two directors ordinarily resident in New Zealand;

• the Board shall maintain at least two Independent Directors (as defined in the NZX Main Board Listing Rules). Where

there are eight or more directors, the board will maintain three or one-third (rounded down to the nearest whole

number) of the total number of directors, whichever is the greater;

• a majority of the directors should not be executives of the Company;

• a director should not have any significant conflict of interest that is potentially detrimental to the Company, other

than and to the extent dealt with in the Corporate Governance Code of the Company;

• the Board seeks diversity in the skills, attributes and experience of its members across a broad range of criteria, to

represent the diversity of shareholders, business types and regions in which the Company operates; and

• the Board elects a Chair, and can replace them at any time.

• Management must provide the board with accurate information within the timeframe required for the board to

effectively discharge its duties.

• The effectiveness and performance of the board and its individual members should be re-evaluated annually.

As at 31 March 2024 the Board comprised of six Directors:

• Asantha Wijeyeratne – Executive Director and CEO

• Gavin Thompson – Non-Executive Director

• Michael O’Donnell – Independent Director

• Shelley Ruha – Independent Director (Chair of Board)

• Mark Samlal – Independent Director

• Jim Sybertsma – Independent Director (Chair of Audit & Risk Committee)

Independence of directors is determined by assessing the directors against the following factors:

• Not currently, or historically (within 3 years) employed in an executive role with PaySauce;

• Not currently holding a senior role in a provider of material professional services to PaySauce;

• No current material business relationship (i.e. as a supplier or customer) to PaySauce;

• Not currently a substantial product holder of PaySauce or a senior manager of a product holder of PaySauce;

• No current material contractual relationship with PaySauce, other than as a director;

• No close family ties with anyone who would fall into the above categories;

• Has not been a director of PaySauce for a length of time that may compromise independence.

Jacqueline Cheyne resigned as an Independent Director and Chair of the Audit & Risk Committee, effective 30

September 2023.

Jim Sybertsma joined the Board as an Independent Director and Chair of the Audit & Risk Committee, subject to

shareholder approval at the next Annual Shareholder Meeting, effective 1 October 2023.

More information on the directors, including their relevant interests, and shareholdings, is provided in the Directors’

disclosures section of this report and is on the company’s website.

Day-to-day management of PaySauce is delegated to the Chief Executive and the Executive team.

The board’s responsibilities

The primary responsibilities of the board are to:

• provide overall governance and strategic leadership;

• oversee management’s implementation of the Company’s strategic objectives and performance;

• oversee the development, adoption and communication of a clear strategy for the Company;

• oversee accounting and reporting systems and ensure the quality and independence of the Company’s external

audit process;

• adopt and regularly review the risk management framework;

• appoint a Chair of the Board and the CEO;

• review and approve the Company’s operating budgets and major capital expenditure;

• adopt and review the Company’s remuneration policy and other corporate governance documents;

• ensure compliance with the Company’s constitution, continuous disclosure obligations, and the relevant laws, listing

rules and regulations and auditing and accounting principles;

• implement and periodically review the Company’s Code of Ethics, foster high standards of ethical conduct and

personal behaviour and hold accountable those who engage in unethical behaviours;

• periodically assess its own effectiveness in carrying out these functions and the other responsibilities of the Board.

On appointment to the board by the shareholders, new directors sign a written agreement that covers the terms of their

appointment.

Every year, the board and sub-committees critically evaluate their own performance and processes. This will identify any

training opportunities for individual directors to maintain relevant and up-to-date skills for their role.

Independent professional advice

With the prior approval of the Chair, each director may seek independent legal and professional advice, at the company’s

expense, about any aspect of PaySauce's operations to assist in fulfilling their duties as a director.

Diversity

The PaySauce board and management are determined that all staff and all eligible candidates for vacant positions should

have equal opportunity to demonstrate their skills and experience. This forms the basis of our diversity policy.

PaySauce embraces uniqueness in our people and welcomes diversity. We believe that difference builds resilience and

innovation. We encourage our employees to be curious and open-minded, embracing wide-ranging perspectives and

working to meet the needs of individuals.

Our approach to diversity is to continually develop a work environment that supports equality, exchange and inclusion.

We believe in accommodating, rather than minimising, the different needs of our people.

The Board has considered the need for measurable objectives for diversity and determined that it is not yet appropriate

to set measurable objectives due to market conditions and the stage of the company's development. That decision will

be reconsidered annually. When appropriate the Board, or a committee appointed by the Board, will set measurable

objectives for achieving diversity (which, at a minimum, will address gender diversity). The Board will annually review those

objectives and the Company’s progress in achieving them. Despite being a small team, there is diversity across age,

gender identity, race, first language, religion and mobility.

7071
CORPORATE GOVERNANCECORPORATE GOVERNANCE

We held the following gender diversity as at 31 March 2024:

As at 31 March 2024

DirectorsExecutive TeamEmployees

Male

5

4

18

Female

1223

Total

6641

As at 31 March 2023

DirectorsExecutive TeamEmployees

Male

4

3

14

Female

2223

Total

6537


Principle 3 – Board committees

“The board should use committees where this will enhance its effectiveness in key

areas, while still retaining board responsibility.”

Audit and Risk Committee

The Audit and Risk Committee (“ARC”) assists the board in financial reporting, and risk and financial/secretarial

compliance.

The ARC makes recommendations to the board on appointing external auditors to ensure their independence. The ARC

also monitors 5-yearly rotation of the lead audit partner.

The ARC facilitates communication between the board and external auditors. The committee’s responsibilities include:

• reviewing the appointment of the external auditor, the annual audit plan, and addressing auditor recommendations

• reviewing publicly released dividend proposals and financial information

• ensuring that appropriate financial systems and internal controls are in place.

The ARC must include at least three directors, and consist of only non-executive directors and have a majority of

independent directors. At least one member must be a director with an accounting or financial background.

The Chair of the Board cannot also be the Chair of the ARC. The current members are Jim Sybertsma (Chair), Michael

O’Donnell, and Gavin Thompson, of which Jim, and Michael are independent directors.

The committee usually invites the Executive Team, and at least twice a year invites the external auditors to attend ARC

meetings.

Principle 4 – Reporting and disclosure

“The board should demand integrity in financial and non-financial reporting, and in

the timeliness and balance of corporate disclosures.”

Reporting and disclosure

The board is committed to providing accurate, thorough, and timely information to existing shareholders and to the

market. This means all investors can make informed decisions about PaySauce.

As an NZX listed company, PaySauce must comply with disclosure requirements under the NZX Main Board Listing Rules.

PaySauce recognises the importance of these requirements in providing equal access for all investors, or potential

investors, to price-sensitive information.

The disclosure and communications policy outlines PaySauce's obligations to meet disclosure requirements. It also

covers related issues, including external communications.

PaySauce has not provided detailed reporting on environmental, economic and social sustainability risks. Whilst

PaySauce is not yet captured by the mandatory climate risk disclosure reporting regime, management does not consider

the business has material exposure to climate risk given the nature of our business and the increasing diversification of our

customer base.

PaySauce publishes key governance and other relevant documents in the investor centre of our website:

https://www.paysauce.com/investor/

Announcements made to the NZX and reports are also posted on the company’s website.

Principle 5 – Remuneration

“The remuneration of directors and executives should be transparent, fair and

reasonable.”

The board is responsible for setting individual directors’ fees, and monitoring the remuneration of the Chief Executive and

Executive Team.

PaySauce has in place a remuneration policy, outlining the key principles that influence remuneration practices. This can

be found in the Company’s Corporate Governance Code, located on the Company’s website (at the date of this report,

located in section 15 of the Company’s Corporate Governance Code at

https://www.paysauce.com/investor/).

Further details and disclosures are outlined in the disclosures section of this document.

Principle 6 – Risk management

“Directors should have a sound understanding of the material risks faced by

the issuer and how to manage them. The board should regularly verify that the

Company has appropriate processes that identify and manage potential and

material risks.”

The board is responsible for overseeing internal controls to manage key risks, and has overall responsibility for managing risk.

The company maintains a risk register to identify and manage risk. The Executive Team is responsible for maintaining this

register, and reporting to the board on a regular basis.

Through the ARC, the board considers the recommendations of external auditors. The board sees that those

recommendations are investigated and appropriate action is taken, where necessary.

7273
CORPORATE GOVERNANCECORPORATE GOVERNANCE

Principle 7 – Auditors

“The board should ensure the quality and independence of the external audit

process.”

The Audit and Risk Committee (“ARC”) makes recommendations to the board to appoint an external auditor. The

committee also monitors the independence and effectiveness of the external auditor, and reviews and approves any

non-audit services they perform.

The committee meets with the external auditor at least twice a year to approve the terms of engagement, audit partner

rotation (at least every 5 years) and audit fee, and to review and provide feedback on the annual audit plan.

The committee routinely meets with PaySauce’s external auditor, Grant Thornton, without management present. Grant

Thornton also attends PaySauce's ASM.

The company continually monitors its internal control environment.

Principle 8 – Shareholder rights and relations

“The board should respect the rights of shareholders and foster constructive

relationships with shareholders that encourage them to engage with the issuer.”

Information for shareholders

The company seeks to help investors understand its activities, by communicating effectively and providing clear and

balanced information. In addition to interim and annual reporting, the company also chooses to release quarterly trading

updates to the market.

The company website (www.paysauce.com) provides an overview of the business and information about its activities.

This includes details of the company’s services, latest news, investor information, key corporate governance information,

and copies of significant NZX announcements. The website also provides profiles of the directors and the Executive Team.

Shareholders have the right to vote on PaySauce's major decisions, in line with the requirements of the Companies Act

1993 and the NZX Main Board Listing Rules.

Communicating with shareholders

PaySauce works to keep investors well informed, and regularly provides information about current operations and future

plans. This is achieved through our NZX market announcements and presentations to retail investors.

PaySauce sends notice of the ASM to shareholders, and publishes it on the company website at least 28 days before the

meeting each year.

Disclosures

Employee remuneration

The table below sets out the number of PaySauce Group employees and former employees who received remuneration

and other benefits, including non-cash benefits and share-based remuneration in excess of $100,000 per annum.

Director remuneration is not included in the table below, and instead set out in a separate section below.

Remuneration rangeEmployees ‑ 2024Employees ‑ 2023

$100,000 - $109,99923

$110,000 - $119,9992-

$120,000 - $129,99923

$130,000 - $139,99912

$160,000 - $169,9993-

$180,000 - $189,9991-

$190,000 - $199,9991-

$200,000 - $209,999-1

$240,000 - $249,999-2

$250,000 - $259,99911

$300,000 - $309,9991-

$310,000 - $319,9991-

$350,000 - $359,9991-

Donations

No cash donations were made by the Group during the year ended 31 March 2024 (2023: $Nil). Donations in kind of

$175,000 were given to 102 charities and non-profit organisations during the period (2023: $130,000, and 100).

7475
CORPORATE GOVERNANCECORPORATE GOVERNANCE

Board meeting attendance

Board meetings are held in person and/or by teleconference. The Directors attended the following board meetings

during the year ended 31 March 2024:


DirectorBoard Meetings AttendedARC Meetings Attended

Asantha Wijeyeratne11 of 11-

Gavin Thompson11 of 113 of 3

Jacqueline Cheyne*6 of 61 of 1

Michael O'Donnell11 of 112 of 3

Shelley Ruha11 of 11-

Mark Samlal11 of 11-

Jim Sybertsma**3 of 52 of 2

Note - If a director was not a member of a particular committee at the time of the relevant meetings ‘-‘ has been

recorded.

*Jacqueline Cheyne resigned as an Independent Director and Chair of the Audit & Risk Committee, effective 30

September 2023.

**Jim Sybertsma joined the Board as an Independent Director and Chair of the Audit & Risk Committee, subject to

shareholder approval at the next Annual Shareholder Meeting, effective 1 October 2023.

Directors’ share transactions

Directors disclosed, pursuant to section 148 of the Companies Act 1993 and Part 5 of the Financial Markets Conduct Act

2013, the following acquisitions and disposals of relevant interest in PaySauce ordinary shares during the year ended 31

March 2024:


DirectorRegistered holder /

associated entity

Number

of shares

acquired /

(disposed)

ConsiderationDate

Asantha WijeyeratnePayroll.Kiwi Limited79,806$21,655Mar-24Discretionary

bonus paid

and applied to

paying up unpaid

Employee Share

Scheme Shares

Asantha WijeyeratnePayroll.Kiwi Limited(40,000)$NilFeb-24Off-market sale of

shares - gifted for

no consideration

Mark SamlalMark Samlal43,365$10,000Jan-24Issued shares in

lieu of director

remuneration

Asantha WijeyeratneCloud Investments Limited(2,770,369)$720,296Jan-24Off-market sale of

shares

Asantha WijeyeratnePayroll.Kiwi Limited(74,650)$20,000Jan-24Off-market sale of

shares

Jim SybertsmaJim Sybertsma74,650$20,000Jan-24Off-market

purchase of shares

Asantha WijeyeratnePayroll.Kiwi Limited41,708$10,828May-23Discretionary

bonus paid

and applied to

paying up unpaid

Employee Share

Scheme Shares

Directors’ remuneration

The total Directors’ fees and other remuneration received by the Directors for the period ended 31 March 2024 is outlined

below:

31‑Mar‑2431‑Mar‑23

DirectorDirector feesOther

remuneration

TotalDirector feesOther

remuneration

Total

Asantha

Wijeyeratne

Nil$358,826$358,826Nil$249,206$249,206

Gavin Thompson$40,000Nil$40,000$40,000Nil$40,000

Jacqueline

Cheyne*

$24,375Nil$24,375$45,000Nil$45,000

Michael

O'Donnell

$40,000Nil$40,000$40,000Nil$40,000

Shelley Ruha$65,000Nil$65,000$27,038Nil$27,038

Mark Samlal$10,000Nil$10,000$40,250Nil$40,250

Jim Sybertsma**$11,250Nil$11,250NilNilNil

*Jacqueline Cheyne resigned as an Independent Director and Chair of the Audit & Risk Committee, effective 30

September 2023.

**Jim Sybertsma joined the Board as an Independent Director and Chair of the Audit & Risk Committee, subject to

shareholder approval at the next Annual Shareholder Meeting, effective 1 October 2023.

7677
CORPORATE GOVERNANCECORPORATE GOVERNANCE

Executive Director remuneration

Asantha Wijeyeratne is the Chief Executive Officer, and held this position as at 31 March 2023. He did not receive any

remuneration in his capacity as a Director, but was remunerated as Chief Executive Officer as follows:

31‑Mar‑2431‑Mar‑23

CEO RemunerationSalaryEmployee

Share Scheme

TotalSalaryEmployee

Share Scheme

Total

Asantha Wijeyeratne$305,576$53,250$358,826$213,706$35,500$249,206

Insurance of Directors and Officers

PaySauce has a Directors’ and officers’ liability insurance policy in place. This provides insurance for the liabilities of the

Directors and officers for acts or omissions in their capacity as Directors or employees. The insurance policies do not

cover dishonest, fraudulent, malicious, or wilful acts or omissions.

General Disclosures of Interest

Director/ExecCompanyNature of Interest

Asantha WijeyeratneBuzz Hospitality LimitedDirector

Catalyst IT LimitedShareholder

Cloud Investments LimitedDirector & Shareholder

Manuka Café LimitedDirector

Payroll.Kiwi LimitedDirector

PaySauce LimitedDirector & Shareholder

PaySauce Operations LimitedDirector

Right Remuneration LimitedDirector

Wijeyeratne & Co LimitedDirector & Shareholder

Gavin ThompsonCatalyst Cloud LimitedDirector

Catalyst IT LimitedDirector & Shareholder

Catalyst.Net LimitedDirector

Catalyst IT Australia Pty LtdDirector

Catalyst IT Europe LtdDirector

PaySauce LimitedDirector & Shareholder

PaySauce Operations LimitedDirector

Truenet LimitedDirector

Michael O'DonnellPaySauce LimitedShareholder, Independent Director

Realestate.co.nz LimitedDirector

Brewwell LimitedChair

Radio New Zealand LimitedDirector

NZ Trade + Enterprise / G2GChair

Serato Audio Research LimitedDeputy Chair

Stuff MediaNational Columnist

High Tech New ZealandTrustee

Sandfield SoftwareDirector

Shelley RuhaAnaley Holdings LimitedDirector and Shareholder

IT & Business Consulting LimitedDirector

Analey Investments LimitedDirector and Shareholder

Heartland Bank LimitedIndependent Director

Partners Group Holdings LimitedIndependent Director

Partners Life LimitedDirector

PaySauce LimitedShareholder, Independent Chair

New Zealand Rural Land Management GP

Limited

Director

Allied Farmers LimitedIndependent Chair

Allied Farmers Rural LimitedDirector

LONZ 2008 Holdings LimitedDirector

Allied Farmers Property Holdings LimitedDirector

Rural Funding Solutionz LimitedDirector

QWF Holdings LimitedDirector

Allied Farmers (New Zealand) LimitedDirector

Clearwater Hotel 2004 LimitedDirector

LONZ 2008 LimitedDirector

UFL Lakeview LimitedDirector

7879
CORPORATE GOVERNANCECORPORATE GOVERNANCE

Lifestyles of New Zealand Queenstown

Limited

Director

5M No.2 LimitedDirector

ALF Nominees LimitedDirector

New Farmers Livestock Finance LimitedDirector

9 Spokes International LimitedIndependent Director

9 Spokes Trustee LimitedDirector

9 Spokes Knowledge LimitedDirector

9 Spokes US Holdings LimitedDirector

9 Spokes UK LimitedDirector

9 Spokes Canada LimitedDirector

9 Spokes Australia LimitedDirector

9 Spokes US LimitedDirector

Mark SamlalPaySauce LimitedShareholder, Independent Director

MS&MS Pty LtdDirector

Pay AsiaManaging Director

PYG NXT 1 Inc - Investment companyDirector

Astute Corporation Pty LtdDirector

Managed Payroll Services Pty LtdDirector

INTEGRATED WORKFORCE SOLUTIONS PTY

LT D

Director

IWS BOOKKEEPING AUSTRALIA PTY. LTD.Director

Payroll HQ Pty LtdDirector

Pay Asia Australia Pty LtdDirector

Pay Asia Pty LtdDirector

PayMY Outsourcing Sdn BhdDirector

Pay Asia LimitedDirector

Pay Asia HR Services Limited IncDirector

CONG TY TNH H PAY ASIA VIETNAMDirector

Pay Asia (Thailand) LimitedDirector

PT Payasia Konsultansi IndonesiaDirector

Payasia Company LimitedDirector

Pay Asia Management Private LimitedDirector

Payasia BPO Payroll India Private LimitedDirector

PAYGROUP NZ LIMITEDDirector

PayGroup (Shanghai) Human Resource Co.,

Ltd.

Director

PayGroupEmployee - Founder and CEO

Jim SybertsmaPaySauce LimitedShareholder, Independent Director

Provident Insurance Corporation LimitedDirector

Autodrive Holdings LimitedDirector

RIMANUI FARMS LIMITEDAdvisory Board Member

Hawkesby Management LimitedChief Financial Officer


Note - In some cases, shareholding indicated above may not be held directly. Furthermore, there may be subsidiaries of

the above entities in which the Directors are also interested, without necessarily being a Director, Shareholder, or Officer

of that entity.

Director interests in shares

Directors held the following relevant interests in PaySauce ordinary shares at 31 March 2024:


DirectorSecurities held by Director or associated entity*

Asantha Wijeyeratne36,278,092

Gavin Thompson2,276,978

Michael O'Donnell87,835

Shelley Ruha241,377

Mark Samlal341,825

Jim Sybertsma**74,650

*Whilst directors are not required to own shares as part of their directorships, all have chosen to own shares.

**Jim Sybertsma joined the Board as an Independent Director and Chair of the Audit & Risk Committee, subject to

shareholder approval at the next Annual Shareholder Meeting, effective 1 October 2023.

8081
CORPORATE GOVERNANCECORPORATE GOVERNANCE

Substantial product holders

The substantial product holders in PaySauce ordinary shares as at 31 March 2024 were as follows:


Substantial product holderShares held% of issued shares

Wijeyeratne & Co Limited27,750,43319.93%

Perpetual Trust Limited21,466,66715.23%

Gondolin Trust16,218,12011.50%

New Zealand Central Securities11,770,3208.35%

Cloud Investments Limited8,527,6596.05%

Twenty largest equity security holders

The 20 largest holders of PaySauce ordinary shares as at 31 March 2024 were as follows:

RankShareholders/InvestorsShares held% of issued shares

1Wijeyeratne & Co Limited27,750,43319.68%

2Perpetual Trust Limited21,466,66715.23%

3Gondolin Trust16,218,12011.50%

4New Zealand Central Securities11,770,3208.35%

5Cloud Investments Limited8,527,6596.05%

6Charlotte Anne Lockhart3,211,1832.28%

7New Zealand Depository Nominee3,023,1742.14%

8David Russell Stewart & Adrienne Ruth Stewart2,851,9202.02%

9Ian Stewart Frame & Pamela Anne Frame2,652,7651.88%

10Gavin Thompson2,276,9781.62%

11Woodward Family2,120,0001.50%

12Krishnakumar Guda1,870,0001.33%

13Bhagwanji Bhula Rama1,645,0001.17%

14Malcolm William Campbell1,506,0001.07%

15Hugh Anthony Pradeep Fernando1,471,1021.04%

16Cloud Investments Two Limited1,457,5571.03%

17Geoffrey Wiliam Bennett1,315,8540.93%

18Victoria Ann Taylor1,243,2460.88%

19Amanda Higgins & Patrick Higgins & Paul Philipson1,017,9210.72%

20Matthew Gardner926,1640.66%

Spread of security holders

The spread of holders of PaySauce ordinary shares as at 31 March 2024 are listed below:

ShareholdersShares

Size of holding (shares)Number%Number%

1 - 10,00091473.18%1,713,1871.22%

10,001 - 50,00021116.89%5,049,1103.58%

50,001 - 100,000463.68%3,257,3492.31%

100,001 - 500,000473.76%9,158,9996.50%

500,001 - 1,000,000120.96%8,407,6025.96%

1,000,001 and over191.52%113,395,89980.43%

Totals1249100.00%140,982,146100.00%

NZX waivers from listing rules

No waivers were granted to PaySauce by NZX during the year ended 31 March 2024, and there were no waivers that

PaySauce relied upon during this period.

8283
FINANCIAL STATEMENTSFINANCIAL STATEMENTS

Company Directory

Directors:

Asantha Wijeyeratne

Gavin Thompson

Jim Sybertsma

Mark Samlal

Michael O’Donnell

Shelley Ruha

Registered Office:

85 The Esplanade

Petone, 5012

New Zealand

Website:

www.paysauce.com

Auditor:

Grant Thornton New Zealand Audit Limited

Stock Exchange:

NZX

Share Registrar:

Link Market Services Limited

80 Queen Street

Auckland, 1010

New Zealand

NZ Company Number:

1719868

NZBN:

9429034458099

Investor Calendar

Annual Shareholders Meeting

September 2024

FY25 Half year

30 September 2024

FY25 Interim result announcement

November 2024

FY25 Year end

31 March 2025

34
FINANCIAL STATEMENTS

---

2024
2023

Results presentation

YEAR ENDED 31 MARCH 2024

Maiden Net Profit

The information in this presentation is of a general nature and does not
constitute financial product advice, investment advice or any other

recommendation. Nothing in this presentation constitutes legal,

financial, tax or other advice.

This presentation should be read in conjunction with, and is subject

to PaySauce’s Annual Report, market releases and information

published on PaySauce’s website - www.paysauce.com

This presentation may contain forward looking statements about

PaySauce and the environment in which PaySauce operates, which

are subject to uncertainties and elements outside of PaySauce’s

control - PaySauce’s actual results or performance may differ

materially from these statements. PaySauce gives no warranty or

representation as to its future financial performance or any future

matter.

This presentation may include statements relating to past

performance, which should not be regarded as a reliable indicator for

future performance.

This presentation may include information from third parties believed

to be reliable; however, no representations or warranties are made as

to the accuracy or completeness of such information.

While reasonable care has been taken in compiling this presentation,

none of PaySauce nor its subsidiaries, directors, employees, agents

or advisors (to the maximum extent permitted by law) gives any

warranty or representation (express or implied) as to the accuracy,

completeness or reliability of the information contained in it, nor takes

any responsibility for it. The information in this presentation has not

been and will not be independently verified or audited.

No person is under any obligation to update this presentation at any

time after its release to you or provide you with further information

about PaySauce.

Disclaimer

Please refer to the Glossary for definitions of key metrics used in this presentation. All currency amounts are in New Zealand Dollars unless stated otherwise.

2

PaySauce

Jaime
Monaghan

Chief Financial Officer

Asantha

Wijeyeratne

CEO, Co-founder

Agenda

1. Intro & Strategy

2. Financial Results

3. Q & A

3

PaySauce

Intro & Strategy
Asantha Wijeyeratne, CEO

4

PaySauce

Highlights
Maiden net profit; advancing growth strategy

Free Cashflow

Positive f ree cash flow

2


$0.94m year on year

improvement

$

0.29

m

46

Rule of 40

Self sufficient,

Surpassing Rule

of 40

NPAT

Maiden NPAT

1

.

Underlying NPAT of

$0.19m before deferred

tax asset recognised

$

1.23

m

ARR

Annualised recurring

revenue (ARR) grew 19%

year on year

$

8.00

m

1. Net profit after Tax. 2. Before funds due to customers and IRD.

Maiden net profit

Proof of concept for embedded payroll

nearing completion

Gen 2.0 payroll engine piloted successfully

Self sufficient cash generation re-investing

for scalable growth

Continued to outperform “Rule of 40”

benchmark

Up $1.79m

YoY

Up 19%


YoY

Up $0.94m


YoY

2

Above industry

benchmark

Maiden

Profit

5

PaySauce

We are in transition to our
platform for the future

Gen 1.0 goPayroll +

SmoothPay (acquisition)

Serving over 1,400


customers in NZ,

AU and Pacific Islands

Gen 1.0

Existing code base


serving over 5,900

customers in NZ

Gen 2.0

Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

payroll

Gen 2.0 Payroll

Engine Rev

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

Wholesale

Payroll

Micro-business

App

A

P

I

PaySauce

Gen 2.0

Engine

A

P

I

Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

Payroll

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

4−6 months

sales and

implementation

TIME TO

SALE

Download the app

and pay staff the

same day

TIME TO

SALE

Serve new

customer base

following

implementation

SALES

CYCLE

Support

Accounting and

Direct marketing

channels

SALES

CYCLE

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

PaySauce

6

Gen 2.0 payroll engine affords
us commercial optionality

Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

payroll

Gen 2.0 Payroll

Engine Rev

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

Wholesale

Payroll

Micro-business

App

A

P

I

PaySauce

Gen 2.0

Engine

A

P

I

Wholesale payroll opportunity

Rapid global

scalability by

embedding into

existing providers with

large customer base

End customer

relationship and

support is owned

by the 3rd party

provider

Fixed term, multi

year contract,

invoiced annual in

advance

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

Tax and

compliance

filing

integration

Payment

solution

integration

Wholesale

Payroll

Micro-business

App

Configure

jurisdiction

rules

PaySauce

Gen 2.0

Engine

Very large

under-served market

of micro-businesses

with 1−5 employees

acquired directly and

through accountants

PaySauce owns

the customer

relationship and

provides direct

support

Monthly

subscription on a

pay as you go basis

CUSTOMER

ACQUISITION

CUSTOMER

SUPPORT

REVENUE

RECOGNITION

4−6 months

sales and

implementation

TIME TO

SALE

Download the app

and pay staff the

same day

TIME TO

SALE

Serve new

customer base

following

implementation

SALES

CYCLE

Support

Accounting and

Direct marketing

channels

SALES

CYCLE

Micro-business App opportunity

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

C

O

N

N

E

C

T

S


T

H

R

O

U

G

H


A

P

I

7

PaySauce

FY25 strategy
Partnerships

Powering our go-forward strategy

PeopleProduct

Supercharge growth

We’ll deliver growth through

two distinct paths: continuing

our work directly with the SME

market as well as opening a

whole new opportunity with

wholesale.

To get to $10m ARR, we will:

• Improve brand awareness and

opportunities with targeted

sales and marketing strategies

• Deliver new interface for both

web and mobile

• Identify new wholesale

opportunities, including new

jurisdictions

Loving our customers

Our relationship with our

customers is mutually

beneficial: they get peace

of mind and time through a

great product, and we get

a dedicated fanbase as our

best source of growth.

To make this happen, we will:

• Delight our users with features

and functionality they need and

want

• Provide customers with the

knowledge and guidance they

need to be successful

• Improve product and service

experiences with in-app support

and guidance

Scalability

To ensure we can retain

very high service levels at

scale, we’re focusing on

the improvements to how

we operate. Removing pain

points for ourselves and our

customers means we have

more time to focus on the

growth activities.

To operate more efficiently

and safely, we will:

• Create a smoother journey for

new and existing customers

• Implement AI and other new

technologies to build scalable

processes

• Optimise our tech stack for

speed, security and scale

8

PaySauce

Financial Results
Jaime Monaghan, CFO

9

PaySauce

Financial results
• Maiden positive NPAT result

of $1,232k.

• Positive net operating

cashflow* of $1,475k.

• PaySauce grew total

recurring revenue 32% year

on year due to increased

interest income, additional

customers and increased

ARPU.

• Gross margin grew 40% year

on year from higher revenue

and greater efficiency.

MAR 24 ($000s)MAR 23 ($000s)Change 

Net profit / (loss) after tax (NPAT) $1.23m ($0.56m) $1.79m

Earnings / (Loss) before tax, impairment,

depreciation & amortisation (EBTDA)

$1.06m($0.08m)$1.14m

Free cash flow*$0.30m($0.64m)$0.94m

Cash and cash equivalents* $0.60m$0.50m$0.10m


Total recurring revenue$7.57m$5.72m 32%

Gross margin$5.82m$4.15m40%

Gross margin percentage77%73%4pp

*Excludes funds due to customers and the IRD, collected in performing our role as a PAYE intermediary.

10

PaySauce

Revenue growth
• Recurring Revenue grew 32% to $7.6m for

the year ended 31 March 2024.

• Interest income up 96% year on year.

• Processing fees growth lower at 17% year on

year as PaySauce continues entry into new

verticals, starting with plumbers, gasfitters

and builders.

• Growth in processing fees came from

7% increase in customer count, and a 6%

increase in ARPU.

32

%

$

7.6

m

Recurring

revenue

Recurring Revenue

Mar 21Mar 22Mar 23Mar 24

$0 M

$2 M

$4 M

$6 M

$8 M

11

PaySauce

Results summary
• PaySauce inverted the gap between

Revenue and Expenditure in FY24,

increasing revenue 33% year on year

whilst curbing expenditure growth to 18%.

• After adjusting for the impact of deferred

tax on revenue* - PaySauce delivered an

improvement of $0.7m in the bottom line

with an underlying net profit of $0.2m for

the year.

• Free cashflow (excluding movement

of funds held on behalf of customers)

increased by $0.9m year on year for

March 2024.

*Revenue excludes deferred tax income arising from the recognition of deferred tax from losses carried forward.

Profitability

$8 M

$6 M

$4 M

$2 M

Mar 21Mar 22Mar 23Mar 24

RevenueExpenses

Profitability

Revenue* Expenses

$0.00 M

$0.50 M

-$0.50 M

-$1.00 M

-$1.50 M

-$2.00 M

Mar 21Mar 22Mar 23Mar 24

Free cash flow (excluding funds held on behalf of customers)

Free cash flow

(excluding funds held on behalf of customers)

12

PaySauce

Reinvest for long term growth
• PaySauce increased investment into research

& development by 12% year on year to $2m.

• Investment included additional headcount

- growing 50% year on year and included

several key hires that have led to

improvements both with the structure of the

team, and the security of the product.

• PaySauce migrated to Amazon Web Services

(AWS), enhancing scalability options and

greater flexibility to optimise development

release cycles.

R&D Capitalisation

Mar 21Mar 22Mar 23Mar 24

$2.00 M

$1.50 M

$1.00 M

$0.50 M

$0.00 M

R&D investment

13

PaySauce

Customer metrics
• Fewer customers acquired, and cost to

acquire increased.

• Higher average revenue per customer due to

price increases and higher interest rates.

• Cost to serve each customer increased

slightly - mostly inflationary.

• Customer churn increased slightly to 1.18%

per month, reducing the implied customer

lifetime.

• Increase in customers to 7,368 and customer

lifetime value to $5,890 per customer resulted

in a 23% increase in total customer lifetime

value to $43.4m

*PaySauce changed the methodology in how it recognises customer activity during the period. Refer to

the annual report for full details on the impacts on comparative customer metrics.

CAC

$

510

24%


YOY

New customer joins

PaySauce

Customer acquisition

(CAC)

$510 per customer

ARPU

$

91

Customer pays

a monthly

subscription

Recurring revenue

(Monthly): $91per

customer

11% YOY

Customer receives

support

Cost to serve (CTS)

(Monthly): $21 per customer

Customer stays

with PaySauce

Customer lifetime

Average monthly churn

of 1.18%

CTS

$

21

6% YOY

Customer

Lifetime

7

yrs

3% YOY

At 31 March 2024

Total customer

lifetime value

$

43.4m

23

% YOY

Customer

lifetime value

(CLTV)

$5,890 per

customer

CLTV

$

5,890

CLTV : CAC

12:1

Flat YOY

15% YOY

14

PaySauce

Questions
“I am proud of the advances we’ve made in

our technology and the future opportunities

on offer as a result, particularly in relation to

our wholesale payroll solution. We now have

all the building blocks for an acceleration of

growth.

I look forward to sharing our progress next

quarter and at the Annual Shareholders

Meeting in September.”

Asantha Wijeyeratne

CEO, Co-founder

25.98% shareholder

PaySauce

15

Glossary
Recurring Revenue: Recurring revenue

is revenue that is expected to repeat

each period into the future. For

PaySauce, this is directly linked to the

number of customers, their size, and

the number of pays they run using the

PaySauce payroll products. There are

currently two sources of recurring

revenue - processing fees and interest

income (only interest earned on funds

held on behalf of customers is included

in recurring revenue).

ARR: The total recurring revenue for the

last calendar month of the reporting

period, multiplied by 12.

ARPU (monthly): Average revenue

per user (monthly) is the total recurring

revenue for the month, divided by the

total customers processing payroll that

month.

Gross margin: When discussed as a

SaaS term, is the recurring revenue of

the business, less the cost to serve

customers. This is often then expressed

as a percentage, where the gross

margin is divided by the recurring

revenue.

Churn (monthly): Churn is expressed

as a percentage calculated as the net

reduction of customers in a calendar

month divided by the total customers at

the start of that month.

LTV: Lifetime value is the estimated

value of a customer over its lifetime with

PaySauce. This is calculated by taking

the monthly ARPU multiplied by the

gross margin percentage, then divided

by the monthly churn percentage.

Total Customer LTV: Total customer

lifetime value is the lifetime value

multiplied by the total customers.

LTV : CAC: This ratio reflects the return

on investment for customer acquisition.

It is calculated by dividing the lifetime

value of a customer by the customer

acquisition cost (per addition).

Free cash flow: Cash flows generated

from operating activities less cash flows

used for investing activities (excluding

funds held on behalf of customers).

PayNow: A unique feature in the

PaySauce mobile application, which lets

employee’s access the money they’ve

already earned, effectively letting them

choose their own payday on demand.

Refer to paysauce.com/paynow for

further details.

Rule of 40: The rule of 40 provides

a balanced measure of two key

metrics for SaaS businesses: growth

and profitability. PaySauce uses the

combination of recurring revenue

growth, and EBTDA to assess against

this measure.

EBTDA: Earnings Before Tax,

Depreciation and Amortisation

is calculated by adding back

depreciation, amortisation and

income tax expense to the amounts

reported in the NZ IFRS-based financial

statements. PaySauce believes that

this measure provides useful insights to

measure the performance of PaySauce

as a SaaS business.

Note - the terms and metrics above are

Non-Generally Accepted Accounting

Principles (non-GAAP) measures and

should not be viewed in isolation, not

considered substitutes for measures

reported in accordance with New

Zealand Equivalents to International

Financial Reporting Standards (NZ

IFRS). Refer to the PaySauce Annual

Report for further information.

16

PaySauce



85 The Esplanade, Petone,

Lower Hutt 5012, New Zealand

www.paysauce.com/investor

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