Tyro boss Robbie Cooke offers ‘faster’ resolution on potential $15m in eftpos connectivity claims

The payments group used its latest growth numbers to hit back at a short-seller targeting its stock.

Tyro managing director and CEO Robbie Cooke is focused on rebuilding trust. Photo AAP

Eftpos terminals provider Tyro boss Robbie Cooke says thousands of disgruntled customers affected by a connectivity issue in January and February have a clear choice on resolving potential claims – an internal ‘triage’ system or years of litigation.

“Resolving directly with us is faster,” Mr Cooke told The Australian on the sidelines of reporting its first-half results.

“Litigation (if any) is going to take 3-4 years.

“(With us) There’s more in the hands of businesses than in payments to lawyers.”

Close to 10,000 customers of Tyro, the largest provider of eftpos terminals outside the big four banks, were hit by a connectivity issue on January 5, which affected processing of payments.

On January 13, Sydney-based class-action law firm Bannister said it was investigating potential claims from many businesses against Tyro, valued at $1.4bn on the Australian share market.

The law firm said it was also “considering at any potential shareholder claims” against the publicly listed company following its share price fall.

US short-seller Viceroy issued a highly critical report following the incident, labelling Tyro the “most unreliable and technologically inferior fintech” in Australia.

Atlassian co-founder billionaire Mike Cannon-Brookes holds more than 12.5 per cent of Tyro and supported the business through the short-seller attack.

On Monday, Mr Cooke, who has slammed Viceroy’s report as being factually flawed, said no class action proceedings have commenced and connectivity issues had been resolved.

Tyro is estimating potential merchant claims of about $15m with Mr Cooke encouraging customers to register directly with the business.

“Our first priority over the next six months is to do all that we can to rebuild trust with those of our merchants impacted”.

“This event did not sit comfortably with me nor my team, and notwithstanding 18 years of operation with no similar issue, we are now building a ‘failover’ solution.”

Tyro will trial a new dongle solution for customers in April, which it said was an industry-first move to prevent future disruptions.

The business, which grew its customer base by 13 per cent to 36,720 merchants, reported a lower first-half loss of $3.4m, with revenue down 2 per cent to $114.8m.

A record $12.1bn transactions were processed with earnings before interest, taxes, depreciation and amortisation growing to $8.5m, up from $1.5m.

Mr Cooke said Tyro did not have a “fixation on profit”.

“We have demonstrated strong top-line growth without high costs.

“The opportunity in front of Tyro is that it has only a 3 per cent share of a potential $660bn market in terms of card payment transactions in the country.”

Cash and cash equivalents along with financial investments at the end of December totalled $238.6m.

Shares closed on Monday up 11.8 per cent at $3.04.