ThinkSmart swings to profit after ClearPay sale

ThinkSmart's shares climbed on Wednesday after the company swung to a profit after tax following its sale of ClearPay and confirmed it would distribute AU$8m to shareholders.

The AIM traded company sold 90% of ClearPay to Afterpay Touch Group in August, causing profit after tax for the six month period ended 31 December to jump to £6.9m from a loss of £1.1m.

A statement from ThinkSmart said its ability to innovate and leverage its proprietary technology and expertise was successfully proven through the sale of ClearPay to and added that it will continue to pursue its growth strategy through its existing retail partnership, as well as through diversifying into new markets and sectors.

Ned Montarello, executive chairman of ThinkSmart, said: "The development and launch of the ClearPay offering was underpinned by the Group's core credit and leasing capabilities, as well as its 'SmartCheck' digital proprietary technology platform. The speed at which we were able to bring ClearPay to market demonstrates ThinkSmart's ability to create and realise value, as evidenced by the sale of ClearPay to an emerging global market leader."

At the end of the period the company had cash and cash equivalents of £11.3m, up from £2.5m at the same point the year before, and the company said it would distribute approximately AU$8m to shareholders.

This will come in two parts, a capital reduction that will see the company return 3.772 cents per share (or depositary interest) to shareholders and a special dividend of 3.772 cents per ordinary share (or depositary interest).

Meanwhile, the digital payment solutions provider reported a loss before tax of £0.8m, down 41% compared to the same period the year before, after operating costs were cut by 31% to £2.2m, offsetting a 5% drop in revenue to £3.8m.

"Post the period end, trading continues broadly in line with the performance for continuing activities reported for the interim period. Looking ahead, the business is well positioned to further leverage its proprietary IP for expansion into new products and markets, and to create value for shareholders," said a statement from ThinkSmart.

ThinkSmart's shares were up 13.96% at 13.96p at 0908 GMT.