Cuscal Reports 49% Profit Surge Fueled by Indue and Paymark Acquisitions

Profit Growth Fueled by Strategic Acquisitions

Cuscal Limited (ASX:CCL) delivered a robust financial performance for the year ended 30 June 2026, reporting a 49% increase in statutory profit after tax to $42.7 million, up from $28.7 million in FY25. This surge was underpinned by the successful completion of two transformative acquisitions, Indue Ltd in December 2025 for $75.2 million and Paymark Limited in May 2026 for NZD 37.5 million, significantly expanding Cuscal’s scale and capabilities across Australia and New Zealand.

The acquisitions have broadened Cuscal’s client base and diversified its revenue streams, with Indue contributing $34.8 million and Paymark $5.2 million to net operating income in FY26. The combined entity is positioned to realise substantial cost synergies estimated at $15-$20 million annually post-tax by FY29, alongside EPS accretion exceeding 25% and a return on invested capital above 20% once integration is complete. Non-recurring integration costs are forecast between $25-$30 million over three years, primarily in the first two years.

Underlying Performance Reflects Operational Strength

On an underlying basis, which excludes acquisition and integration costs, tax losses from the 2023 Braavos Group acquisition, and other non-recurring items, Cuscal’s net profit after tax rose 20% to $46.2 million. Underlying net operating income increased 20% to $347.7 million, driven by a 12% rise in transaction volumes to 4.8 billion transactions, reflecting both organic growth and acquisition contributions.

Core capabilities saw strong growth, with issuing net operating income up 22% to $204.2 million and payments net operating income rising 15% to $82.2 million. Financial crimes services, a key enabling foundation, surged 41% to $22.5 million, while data services grew 4% to $5.7 million. Acquiring income remained stable at $30.1 million.

Capital Position and Dividend Policy Support Growth

Cuscal maintained a solid capital position with a total capital adequacy ratio of 19.1%, comfortably above APRA’s minimum requirements and within its target operating range of 18-19%. The company’s strong balance sheet and investment-grade credit rating underpin its capacity to fund ongoing investments and acquisitions.

Reflecting the improved financial performance, the board declared a fully franked final dividend of 7.0 cents per share, payable on 18 September 2026, bringing total dividends for FY26 to 11.5 cents per share, up 15% from the prior year.

Governance Enhancements and Leadership Changes

Governance continued to evolve alongside Cuscal’s growth, with the appointment of Dr Leila Fourie as an independent non-executive director in August 2026. Dr Fourie brings over 30 years of international experience in payments, banking, and capital markets, including CEO roles at the Johannesburg Stock Exchange and the Australian Payments Network. Her addition strengthens the board’s expertise in risk and remuneration oversight.

Meanwhile, director Claudine Ogilvie has announced her intention to resign effective 20 October 2026. Executive leadership changes include Michael Blomfield taking the helm as CEO of Paymark and the creation of a Chief Strategy Officer role to sharpen strategic execution.

Sustainability and Risk Management Integration

Cuscal’s 2026 Sustainability Report, prepared under the Australian Sustainability Reporting Standards, highlights its commitment to environmental, social, and governance (ESG) principles. The company reported modest Scope 1 and 2 greenhouse gas emissions and is actively reviewing its broader sustainability strategy following the acquisitions.

Risk management remains a strategic priority, with a comprehensive Risk Management Framework and Strategy guiding the identification and mitigation of material risks, including operational resilience, cyber security, and regulatory compliance. Climate-related risks were assessed as low given Cuscal’s asset-light, service-based model, with ongoing scenario analysis to monitor emerging exposures.

Executive Remuneration Aligned with Performance and Risk

The board’s remuneration approach continues to emphasize performance and risk alignment, with a greater weighting towards long-term incentives (LTI). In FY26, the Managing Director’s total fixed remuneration was $1.22 million with an STI outcome of 130% of target, reflecting strong group and individual performance. The LTI grants issued are subject to performance conditions tied to relative total shareholder return, earnings per share growth, and synergy delivery from the Indue acquisition.

For FY27, the board approved an increase in LTI opportunity to 100% of fixed remuneration for the Managing Director and 70% for other executives, reinforcing long-term shareholder value creation and accountability.

Outlook: Mid-Twenties Growth Expected

Looking ahead, Cuscal expects to sustain its momentum with underlying net profit after tax and transaction volumes forecast to grow in the mid-twenties percentage range in FY27. Growth will be driven by ongoing organic expansion, full-year contributions from Indue, and the initial impact of Paymark, alongside disciplined cost management and continued integration efforts.

The company remains focused on extending its product offerings into new segments and markets, enhancing transaction monitoring capabilities, and delivering value for clients across the payments ecosystem.

With a strengthened trans-Tasman presence and a diversified earnings base, Cuscal is positioning itself for sustained growth amid evolving regulatory and technological landscapes.