Worldline meets third quarter revenue estimates on merchant services strength

:French digital payments company Worldline on Wednesday reported third-quarter revenue largely in line with analyst expectations, as resilient performance in its business services offset the termination of some contracts.

Sales in the third quarter of the year fell organically by 1.1 percent year-on-year to 1.16 billion euros ($1.3 billion), in line with the average analyst estimate of 1.17 billion euros in a consensus provided by the company.

The Merchant Services business – which accounts for around 75 percent of the group’s adjusted core profit and provides payment terminal and e-commerce services – saw revenue growth of 0.2 percent in the quarter, helped by steady growth in Central Europe and a larger market share. in Southern Europe.

Faced with slower consumer spending in Europe and a drop in market valuation that led to its exclusion from France’s CAC 40 index last year, Worldline’s efforts to boost its share price have been hampered by repeated cuts to its financial targets.

The Paris-based company, which processes digital transactions for clients ranging from merchants to government agencies, issued profit warnings in August and September, the most recent of which was announced with the departure of longtime CEO Gilles Grapinet.

The group confirmed its 2024 forecasts for adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of approximately 1.1 billion euros and organic growth of approximately 1 percent.

“We aim to gradually return to single-digit revenue growth by 2025,” CEO Marc-Henri Desportes said in a statement.

Desportes was appointed for an interim period because Worldline management is still looking for Grapinet’s successor.

“The board members will appoint a new CEO, I am committed to taking action today,” he said during a conference call with journalists.

Analysts at investment bank Intermonte have said partnerships are back on the table in the payments sector, citing Mario Draghi’s report on the European Union’s competitiveness, which could pave the way for a merger between Worldline and its Italian rival Nexi.

“We have built a great success story in Italy, it is normal that this generates rumors… but what matters now is the margin of our business, that is our priority,” Desportes said when asked about further mergers and acquisitions in Italy .

($1 = 0.9206 euros)