PAX Technology logo in white transparent
Flag of Australia

PAX Technology 2023 Financial Results

PAX Global Technology Limited, one of the world’s leading providers of electronic payment terminal (“E-payment terminal”) solutions and related services, is pleased to announce the audited annual results for the year ended 31 December 2023.

In 2023, the recovery of global economy still encountered substantial challenges. High inflation, as well as exchange rate fluctuations, remain as primary concern for many global customers, leading to increased prudence in payment terminal deployment, which in turn have an impact on the Group’s revenue. PAX adeptly responded to market dynamics through the implementation of flexible strategies that further focus on high margin markets, resulting in positive progress. Thanks to our diversified revenue structure across four international regions, as well as cost reduction resulting from effective cost control strategies and RMB depreciation, the Group’s gross profit margin reached 44.6%. In 2023, the Group recorded revenue of HK$6,709.3 million, profit for the year of HK$1,165.1 million, and an increased net profit margin of 17.4%. The Board has recommended to declare a final dividend of HK$0.23 per ordinary share for the year ended 31 December 2023.

A new headquarters building marks a new milestone in the Group’s development

As a leading global electronic payment terminal enterprise, PAX is committed to investing in the future with a long-term international perspective. In view of the Group’s global business growth and ongoing increase in workforce, PAX has completed its new headquarters building in Pinghu, Longgang District, Shenzhen City, China, and officially commenced operations in January 2024. The 18-storey headquarter building has above-ground gross floor area of approximately 29,000 square metres, as well as an underground floor area of approximately 16,000 square metres of primarily parking space, providing employees with high-quality working environment. CAPEX (including the cost of land use rights) of the new headquarters construction project was approximately HK$360 million. The opening of the new headquarters building will effectively enhance inter-departmental collaboration and efficiency, thereby strengthening the development of PAX business worldwide.

Mr. Jack LU, Chief Executive Officer of PAX, commented, “Upholding a corporate cultural spirit of continuous innovation and relentless pursuit of excellence, PAX places strong focus on merchants and consumers, striving to deliver exceptional payment experiences worldwide. To maximise the full potential of Android smart payment solutions, the Group is poised to further strengthen the MAXSTORE ecosystem. Meanwhile, the Group is proactively increasing its investment in EPOS segment and focus on the continuous development of a diverse range of Elys products seamlessly integrated with business Internet of Things.

Android smart payment terminals and the Software as a Service (“SaaS”) solutions continue to deliver intelligent values to merchants worldwide

PAX stands at the forefront of the international payment terminal industry. Since the launch of Android-based smart payment terminals in 2016, the Group has actively promoted solutions featuring intelligent payment and business process management globally, helping merchants enhance their agility in navigating market dynamics. In 2023, sales of Android smart payment terminals accounted for more than 50% of the Group’s total revenue, becoming a crucial pillar in the PAX business.

As Payment Card Industry PIN Transaction Security (“PCI PTS”) 4.0 and 5.0 certifications are scheduled to expire in 2024 and 2026, upcoming market demand is expected to gradually shift towards deployment of payment devices with PCI PTS 6.0 certification. In order to capture the future opportunity of terminal replacements, PAX launched a range of Android smart payment solutions during the year, including the A920MAX, A930 and the IP67-rated Android PDA A6650, all of which are PCI PTS 6.0 certified.

Since the launch of PAX SaaS solutions, there has been a growing adoption among acquiring banks, PSPs and PAX channel partners worldwide. In 2023, revenue generated from SaaS solutions (including MAXSTORE) reached a noteworthy milestone of over HK$100 million. As of 31 December 2023, over 11 million devices connected to the MAXSTORE platform, providing merchants with a diverse array of software applications and value-added operational services.

PAX embarked on a new business strategy to seize the Android commercial POS (“EPOS”) market opportunity

Recognising the increasing demand for integrated business solutions across retail, catering and hospitality, the Group implemented a new business strategy, actively venturing into opportunities within the EPOS field. Leveraging our R&D edge in Android smart terminal technology, PAX has rolled out the Elys Series during the year.

The Elys Series incorporates a suite of software and hardware for business Internet of Things. Powered by Android, these devices seamlessly interconnect and collaborate between in-store EPOS devices. In 2023, the Elys Series won the prestigious German Red Dot Product Design Award and iF Design Award. The Elys Series has been well received by the market, and the Group expects it will make a greater contribution in the future.

PAX was elected to the Payment Card Industry Security Standards Council (PCI SSC) Advisory Board

In 2023, PAX was elected to the PCI SSC Advisory Board, distinguishing itself as the first Asian payment terminal provider to take up the role. The advisory board consists of over 50 influential international organisations across industries. PAX, as one of the members, is committed to making further contributions to the long-term development of the payment industry.

Latin America and the Commonwealth of Independent States (LACIS)

In LACIS, the Brazilian payment market has undergone rapid development in recent years, creating high levels of payment terminal penetration. As a result, PAX sales in Brazil slowed down, offsetting strong growth of other regional markets.

PAX has been actively pursuing new opportunities in the region and strengthening collaborative relationships with channel partners and PSPs. During 2023, the Group achieved record-high sales in Mexico, Chile and Argentina, where these markets have become key driving forces for PAX in the Latin American market. As the commercial value of the A-series Android smart payment terminals has been increasingly recognised, more channel partners and PSPs have accelerated their deployments in retail, catering, transportation and other sectors, propelling substantial sales growth.

Europe, the Middle East and Africa (EMEA)

In EMEA, multiple economic factors contributed to mixed performances across different countries. Across Europe, demand for PAX payment solutions weakened in Germany, however the Group continued to record notable sales in Italy, the United Kingdom, Turkey, Spain and France. In France, the full range of PAX Android payment terminals now support FRv6 payment application, which is compliant with the national payment association Groupement des Cartes Bancaires (GIE CB) and supports both contact and contactless payments. This will further empower the Group to strengthen its market position in the country.

In the Middle East, in view of surging demand for cutting-edge financial technology, PAX has accelerated its sales network expansion to capitalise on growing opportunities within the payment terminal market. During the year, the Group’s sales achieved significant performance by nearly doubling in both the United Arab Emirates and Kuwait. Meanwhile, the longer-than-expected sales cycle in Saudi Arabia resulted in temporary sales slowdown. A gradual uptick in market demand momentum is expected in the future. In Africa, Egypt remains a key market for PAX, and we achieved positive sales results in South Africa during the year.

Asia Pacific Region (APAC)

The Group continued its expansion across diverse markets in the Asia Pacific region. PAX achieved remarkable sales growth in Japan, Indonesia and the Philippines during the year. However, the longer-than-expected sales cycle in India resulted in sales slowdown, offsetting the growth of other markets in the region.

In Japan, a robust rise in the number of inbound tourists has driven the market demand for cashless solutions, fostering swift adoption of the PAX A920 model. Leveraging innovative Android solutions, the PAX brand has gained increased recognition from local acquirers and PSPs. In 2023, the Group’s sales in Japan doubled, reaching a record high.

As an integral part of the Asia Pacific, PAX has consistently increased its investment in Southeast Asia, yielding significant results. In Indonesia, the Group continued its high-growth momentum by successfully securing bulk orders from multiple acquiring banks, achieving record-high sales. Indonesia now becomes as another key driver of growth in the Asia Pacific region. In the Philippines, PAX achieved substantial surge in sales, exceeding 400% growth during the year.

In Australia and New Zealand, PAX has become the preferred terminal provider for key PSPs. In 2023, the Group accelerated certification works and successfully secured landmark projects, including Virgin Australia and A2B Australia – the Australian taxi payment solutions company. These successes have laid a strong foundation for PAX positioning in the Australian and New Zealand markets.

The United States of America and Canada (USCA)

In 2023, PAX strengthened its ties with local Independent Sales Organisations (“ISOs”) and financial institutions, deploying high-quality payment solutions for merchants. With the ongoing reinforcement of Android product offerings, PAX brand recognition is on the rise in North America. During the year, the Group introduced the Elys Series, innovative EPOS solutions specifically tailored for retail and catering. Featuring cutting-edge software and hardware for business Internet of Things, the Elys Series garnered high praise from customers, providing PAX a new growth momentum in North America.

PAX is dedicated to expanding its Independent Software Vendor (“ISV”) alliances, with a focus on crafting customised solutions for vertical industries that deliver unique value propositions to customers. The synergy between MAXSTORE and Android products is now stronger than ever, propelling growth in both the shipment of Android products and the number of connected devices on the MAXSTORE across North America.

Mr. Jack LU, Chief Executive Officer of PAX, commented, “Despite the ongoing impact of factors such as high interest rates and sluggish trade on the global market, electronic payments remain an indispensable element of the future digital economy. Many countries across the globe are undergoing transition towards cashless societies. It is expected that the global payment terminal market reached US$29.6 billion by 2030, a compound annual growth rate of 9.5%, highlighting the extensive long-term prospects for the payment terminal industry.

For more information, please refer to the announcement and presentation.