REG - Cornerstone FS PLC - 2023 Full Year Trading Update

Cornerstone FSAnnouncement

10/01/2024 07:00

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RNS Number : 1529Z  Cornerstone FS PLC  10 January 2024

Certain information contained within this Announcement is deemed by the
Company to constitute inside information as stipulated under the Market Abuse
Regulation (EU) No. 596/2014 ("MAR") as applied in the United Kingdom. Upon
publication of this Announcement, this information is now considered to be in
the public domain.

 

10 January 2024

 

Cornerstone FS plc

("Cornerstone" or "the Company" or "the Group")

 

2023 Full Year Trading Update

Doubling of revenue and delivery of maiden full year adj. EBITDA

 

Cornerstone FS plc (AIM: CSFS), a foreign exchange and payments solutions
company offering multi-currency accounts to businesses and individuals through
its proprietary technology platform, is pleased to provide an update on
trading for the year ended 31 December 2023. The information contained herein
has not been audited and may be subject to further review and amendment.

 

Highlights

·    Revenue growth of 100% to c. £9.6m (2022: £4.8m)

·    Gross margin improvement to c. 63% (2022: 60.9%)

·    Adj. EBITDA(1) of not less than c. £1.4m (2022: £0.9m adj. EBITDA
 loss)

·    Net cash generated from operating activities of c. £1.4m (2022: net
outflow from operating activities of £0.8m)

·    Cash and cash equivalents at 31 December 2023 of c. £2.3m (30 June
2023: £0.8m; 31 December 2022: £0.7m)

 

The Group is pleased to confirm that the previously reported strong trading
momentum was sustained to year end and, as a result, it expects to report a
year-on-year increase in revenue of approximately 100% to £9.6m (2022:
£4.8m), ahead of market expectations. The significant growth reflects the
advancements made across the business driving year-on-year increases in active
customers(2) (2023: 906, 2022: 803) and average transaction value. Key
elements of this have been growth in the sales team and enhancing and
expanding the Group's offering, in particular increasing the number of
counterparties to broaden the range of currencies and countries where it can
transact.

 

The Group expects to report an improvement in gross margin to c. 63% for 2023
(2022: 60.9%), reflecting a lower proportion of revenue derived from white
label partners following the strategic decision to manage down almost all of
its historic white label business. The Group also saw an improvement resulting
from the change in commission arrangements agreed with Robert O'Brien, General
Manager APAC and Middle East, in the first half of the year.

 

With the increase in revenue and gross margin, as well as continued careful
management of the cost base, the Group expects to report adjusted EBITDA for
2023 of not less than £1.4m, which is significantly ahead of current market
expectations, compared with an adjusted EBITDA loss of £0.9m for the previous
year. The Group generated a net cash inflow of c. £1.6m during the year,
including a cash inflow from operating activities of c. £1.4m (2022: net cash
outflow from operating activities of £0.8m), with cash and cash equivalents
at 31 December 2023 of £2.3m (30 June 2023: £0.8m; 31 December 2022:
£0.7m).

( )

(1) Adjusted to exclude share-based compensation, transaction costs, other
operating income and profit on a disposal of a subsidiary

(2) Defined as customers who traded through Cornerstone in the preceding 12
months

 

James Hickman, CEO of Cornerstone, said: "It has been an excellent year for
Cornerstone as we made substantial strategic progress culminating in a set of
strong financial results which significantly exceeded the Board's expectations
this time last year. We have enhanced our sales team and expanded our
offering, which has resulted in us executing higher value transactions and
with a greater number of active customers. With a highly scalable platform,
along with careful management of our cost base, we are also benefitting from
the operating leverage within our business and 2023 has seen us report our
maiden full year adjusted EBITDA. We look forward to updating the market on
our success as we progress through 2024."

 

Investor Presentation

 

The Group gives notice that James Hickman, CEO, Judy Happe, CFO, and Jordanna
Curtis, COO, will be presenting via Investor Meet Company on 16 January 2024
at 10.00am GMT to provide investors with an update on the Group's strategy.

 

Questions can be submitted pre-event via the Investor Meet Company platform up
until 9.00am GMT the day before the meeting or at any time during the live
presentation.

 

Investors can sign up to Investor Meet Company for free and add to
meet Cornerstone via:

https://www.investormeetcompany.com/cornerstone-fs-plc/register-investor
(https://url.avanan.click/v2/___https:/www.investormeetcompany.com/cornerstone-fs-plc/register-investor___.YXAxZTpzaG9yZWNhcDphOm86YTU1M2E3ODJmZjg3MmE5ODI5ZjE2NjFiZjcxZjkwNmM6NjphNTU4OjYxMTMwZDQwODllZTA1NDE5MmI4NmJhMWYyOTJkOTlkYjFlY2FlZjQ4NTIyZTI5MjBlNGVmYmI0ZTZjMDZhNGE6cDpU)

 

Enquiries

 

 Cornerstone FS plc                            +44 (0)203 971 4865
 James Hickman, Chief Executive Officer

 Judy Happe, Chief Financial Officer

 SPARK Advisory Partners Limited (Nomad)       +44 (0)203 368 3550
 Mark Brady, Adam Dawes

 Shore Capital (Broker)                        +44 (0)207 408 4090
 Daniel Bush, Tom Knibbs (Corporate Advisory)

 Guy Wiehahn (Corporate Broking)

 Gracechurch Group (Financial PR)              +44 (0)204 582 3500
 Harry Chathli, Claire Norbury

 

 

About Cornerstone FS plc

 

Cornerstone FS plc (AIM: CSFS) is a foreign exchange and payments company
offering multi-currency accounts and payment solutions to businesses and
individuals. Headquartered in the City of London, Cornerstone combines a
proprietary technology platform with a high level of personalised service to
support clients with payments in over 150 countries in 58 currencies. With a
track record of over 12 years, Cornerstone has the expertise, experience and
expanding global partner network to be able to execute complex cross-border
payments. It is fully regulated by the Financial Conduct Authority as an
Electronic Money Institution through its wholly owned subsidiary company
Cornerstone Payment Solutions Limited. www.cornerstonefs.com
(https://url.avanan.click/v2/___http:/www.cornerstonefs.com/___.YXAxZTpzaG9yZWNhcDphOm86YTU1M2E3ODJmZjg3MmE5ODI5ZjE2NjFiZjcxZjkwNmM6NjpmMTRlOmJmNjU4NGI4NDcxZGQ4MmJiZGUyNjhjMzBlNzQ4NzlhMGExNzM5MzMzMjQ2MzkxMmRmZjhlNGRiNzA0ZjE4Y2U6cDpU)
 

 

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