TIDMEPO
RNS Number : 8101L
Earthport PLC
24 July 2017
Earthport plc
("Earthport" or the "Company")
Unaudited Trading Update for the year ended 30 June 2017
Earthport (AIM: EPO.L), the leading payment network for
cross-border payments, is pleased to provide an unaudited trading
update for the fiscal year ended 30 June 2017 ("FY 2017").
Financial Highlights
-- Revenues grew by approximately 33% to GBP30.3 million (FY 2016: GBP22.8 million)
o Approximately 90% of the revenue growth was driven by the
existing client base
o Transactional revenues comprised 95% of FY 2017 total
revenues
-- Adjusted gross profit(1) increased by approximately 30% to
GBP20.7 million (FY 2016: GBP15.9 million)
-- Adjusted gross margin(1) decreased by approximately 2% to 68% (FY 2016: 70%)
-- Administrative expenses decreased approximately to GBP25.5
million (FY 2016: GBP25.8 million), representing 84% of revenues
(FY 2016: 113%)
-- Adjusted EBITDA(2) loss decreased by approximately 65% to
GBP2.4 million (FY 2016: GBP6.9 million)
-- Cash Balance at 30 June 2017 amounted to GBP11.9 million,
compared to GBP14.4 million at 30 June 2016
Operational & Transactional Highlights
-- Monetary value of transactions processed increased by 48% to
$17.5 billion(3) (FY 2016: $11.8 billion)
-- Record number of transactions at approximately 11 million, up 67% (FY 2016: 6.6 million)
o Earthport's payments processing platform continues to perform
at a 99.9% "up-time" rate, ensuring virtually uninterrupted service
for our clients
-- A total of 143 new opportunities, inclusive of existing and
new clients, are currently in the commercial pipeline
-- Total of 10+ new countries in our Network pipeline
-- Executed payments across 193 destination countries, in 49 currencies
-- Average revenue per transaction of GBP2.64 (FY 2016: GBP3.12)
_________________
1. Adjusted gross profit and margin figures are before warrant
charge, share based payment charge, unrealised fair value
adjustment and exceptional items
2. Adjusted EBITDA is before warrant charge, share based payment
charge, unrealised fair value adjustment and exceptional items
3. Figure shown in US dollars to conform with market
practice
Summary
The performance of the business in FY 2017 has been encouraging
with a substantial increase in the number of transactions and
payment volumes resulting in revenues of GBP30.3 million. We
continue to invest in the Company's operational platform to ensure
scalability and resilience, as well as expanding our geographical
presence and product capabilities. Our ongoing cost efficiency
objectives have resulted in a small decrease in administrative
expenses. When combined with growing revenues, the adjusted
EBITDA(2) loss has decreased by 65% to GBP2.4 million in FY 2017.
Excluding our expenditures and investments to support strategic
growth during the year, Earthport's existing business continues to
generate an operating margin of approximately 25%.
Key investments in the period included the launching of the
India strategy, building on the Reserve Bank of India approval,
allowing Earthport to work with all Indian banks for outbound
payments. This is a significant opportunity to serve the extensive
Indian market. In addition, we have expanded our focus on serving
the eCommerce sector in the US where the early indicators are
positive. Our Network is a unique asset and we have added to it by
forming a new partnership with Asian United Bank (AUB) in the
Philippines, as well as launching a new route to Bangladesh, while
strengthening our existing Network presence with a number of
operational improvements. We currently have more than ten new
countries in our Network pipeline and expect to cover most of
Africa during the next 12 months.
On the commercial side of the business, a total of 143 new
opportunities are currently in the pipeline across Europe, the
Americas, Middle East and APAC. Our client mix continues to evolve
in line with our long-term strategy of establishing our presence in
the industries we serve, with banks driving the majority of the
contracted new opportunities. In addition, we have broadened our
strategic relationship with Bank of America Merrill Lynch (BofAML)
by expanding the service which adds numerous new countries and
currencies to the bank's online and file based banking portal,
CashPro(R).
As previously communicated, Earthport was not cash flow
breakeven in FY 2017, principally to capitalise on the growth
opportunities related to new customer acquisition, product and
delivery enhancements presented during the year. Given the current
business and operational trajectory, we are pleased that FY 2017
transactional performance, revenues, and year-end cash balance were
in-line with market expectations. This positive momentum, coupled
with our unique market positioning, gives us confidence in our
continued growth and prospects.
For further information, please contact:
Earthport plc
Hank Uberoi, Chief Executive Officer
Simon Adamiyatt, Chief Financial
Officer 020 7220 9700
Newgate
Bob Huxford / James Ash / James Browne 020 7653 9848
N+1 Singer (Nomad and Joint Broker)
Mark Taylor / James White 020 7496 3000
Shore Capital (Joint Broker)
Bidhi Bhoma/ Toby Gibbs 020 7408 4090
About Earthport
Earthport provides cross-border payment services to banks and
businesses. Through a single relationship with Earthport, clients
can seamlessly manage payments to almost any bank account in the
world, reducing costs and complexity to meet their customers'
evolving expectations of price, speed and transparency.
Earthport offers clients access to global payment capability in
190+ countries and territories, with local ACH options in 60+
countries and an evolving suite of currencies and settlement
options.
Earthport continues to invest in the establishment of in-country
bank partnerships across the world, bringing together its deep
market and regulatory expertise in order to maintain compliant and
commercially competitive services.
The result - a global payments Network accessed via a single
relationship, delivering significant cost and operating
efficiencies for banks and businesses servicing high volumes of
lower value payments.
Headquartered in London with regional offices in New York,
Dubai, Miami and Singapore, Earthport is a public company, traded
on the London Stock Exchange (AIM: EPO) with an institutional
investor base including World Bank IFC, Oppenheimer, Blackrock,
Henderson.
Please visit www.earthport.com for more information.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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