REG - Eurowag - Trading Update

WAG Payment SolutionsAnnouncement

24/10/2023 07:00

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RNS Number : 0274R  Eurowag  24 October 2023

24 October 2023

 

W.A.G payment solutions plc

("Eurowag" or the "Group")

 

Trading Update

 

Solid performance, in-line with expectations

 

W.A.G payment solutions plc ("Eurowag", or the "Group") a leading pan-European
integrated payments and mobility platform focused on the Commercial Road
Transportation industry ("CRT"), today announces its trading update for the
nine-month period ending 30 September 2023.

 

Financial highlights for 9 months:

 

·     In the 9 months net revenue grew 35.5% to €183.7 million(1),
supported by sustained organic growth from both the acquisition of new
customers and cross-selling of new capabilities, as well as the significant
contribution from our Inelo acquisition.

·   In the 9 months organic net revenue grew 17.1% to €158.7 million(2),
driven by strong growth in mobility solutions.

o  Mobility solutions organic revenues, which now includes Webeye, grew
36.6%(2) as a result of effective cross-sell and new automotive strategic
partnerships. This is also reflective in the Q3 mobility solutions organic
revenues which grew 28.1% year-on-year.

o  Payment solutions organic revenues grew 9.3%(2), with economic headwinds
continuing to impact the CRT industry, reflecting fewer kilometres driven.
These headwinds continued into Q3, and as a result payment solutions organic
revenues in the quarter were flat year-on-year.

·     If Inelo had been acquired at the start of the financial year, net
revenue contribution to the Group would have been €34.4 million.

·      Net revenue for the last twelve months grew 33.7% to €239.0
million.

 

Martin Vohánka, CEO and Founder said:

 

"I am pleased to report that the Group delivered a solid performance in the
first nine months of this year, once again demonstrating the resilience of our
business model as well as the mission critical nature of our solutions. Our
strong double-digit organic growth was achieved despite the macroeconomic
headwinds across Europe impacting the CRT industry through a slowdown in
freight demand, and therefore fewer kilometres driven.

 

Following recent acquisitions, our revenue mix has been further diversified
towards mission critical data-centric software solutions, and we are
capitalising on the synergies and significant cross-sell opportunities
presented. We continue to deliver on our priorities of integrating our newly
acquired businesses as well as deliver on our vision of providing the
industry's first integrated end-to-end digital platform, launching in Q4 2024.
All of this gives me confidence that we will continue delivering value for all
stakeholders, whilst our full year expectations remain unchanged."

 

 

                     Net revenue          Year-on-year  Organic revenue  Organic

                     (€m)                 growth        (€m)²            year-on-year

                                          (%)                            growth

                                                                         (%)
                     9M 2023(1)  9M 2022
 Payment solutions   106.0       96.9     9.4%          105.9            9.3%
 Mobility solutions  77.7        38.7     100.8%        52.9             36.6%
 Total               183.7       135.6    35.5%         158.7            17.1%

 

                     Net revenue                                           Year-on-year  Organic revenue  Organic

                     (€m)                                                  growth        (€m)²            year-on-year

                                                                           (%)                            growth

                                                                                                          (%)
                     12 months to 30 Sept 2023  12 months to 30 Sept 2022
 Payment solutions   144.0                      129.3                      11.4%         143.9            11.3%
 Mobility solutions  95.0                       49.5                       91.9%         70.2             41.7%
 Total               239.0                      178.8                      33.7%         214.0            19.7%

Notes:     1. Net revenues include 6 months of contribution from Inelo
following the completion of the acquisition.

2. Organic revenues excludes the contribution from Inelo.

 

Operational highlights

 

·      Revenue growth continues to be supported by strong non-financial
KPI performance:

o  Average number of payment solutions active customers rose from 17,201 in
Q3 2022 to 18,519 in Q3 2023, representing 7.7% year-on-year growth.

o  Average number of payment solutions active trucks rose from 86,523 in Q3
2022 to 93,433 in Q3 2023, representing 8.0% year-on-year growth. The growth
in the reporting quarter has accelerated compared to Q1 and Q2 2023, as a
results of trucks from our Portuguese customers returning to fuel in Spain
following the reverse in the fuel legislation at the end of Q2 2023, as well
as new customer acquisitions momentum in Poland.

 

Strategic highlights

 

The Group held its first Capital Markets Day on 11 October 2023, which
included an update on the Group's strategic ambitions, aligned to the
strategic pillars announced at the end of 2022. Eurowag also presented
detailed summaries of its sales strategy and product offering, with a clear
roadmap towards delivering the Group's integrated end-to-end digital platform.
To review all the materials from the event, please visit the Group's website
at https://investors.eurowag.com/ (https://investors.eurowag.com/)

 

Outlook and Guidance

 

As communicated at the half year results, considering the macro-economic
headwinds and the magnitude of the transformative programme we are
undertaking, we expect near-term net revenue percentage growth to be around
mid-teens. In the medium-term, we expect the net revenue percentage growth to
return to high-teens, reflecting the value creation from our platform through
the growth in customers, the cross-sell opportunities, and the full extraction
of acquisition synergies.

 

We expect FY 2023 margin levels to be in-line with FY 2022, at around 43%,
accounting for net revenue weighting in the second half and cost actions
already proactively taken, including headcount reduction ahead of integrating
Webeye and Inelo into our organisational structure. We still expect our margin
in the medium-term to improve to high-forties, as operational leverage and
acquisition synergies are realised.

 

As articulated at the Capital Markets Day, we expect to finalise our
transformational capex programme by the end of 2023, on time and within
budget. Following the acquisition of Inelo and Webeye, we expect ordinary
capex to move to just above 10 percent of net revenues for the end of this
financial year. The ordinary capex over the medium-term is expected to be
around 10 percent of net revenues. We anticipate reducing duplications across
IT, hardware, and technology over time through a combination of integration
and the transition to a single technology platform.

 

Reducing our net debt to adjusted EBITDA within our target leverage range of
1.5x to 2.5x remains our priority.

 

The Board's expectations for the full year remain unchanged.

 

ENQUIRIES:

 

Eurowag

Carla Bloom

Head of Investor Relations and Communications

+44 (0) 789 109 4542

investors@eurowag.com (mailto:investors@eurowag.com)

 

Instinctif Partners

Galyna Kulachek and Bryn Woodward

IR and International Media

+44 (0)20 7457 2020

eurowag@instinctif.com (mailto:eurowag@instinctif.com)

 

About Eurowag

 

Eurowag was founded in 1995 and is a leading pan-European integrated payments
& mobility platform focused on the commercial road transportation
industry. Eurowag's innovative solutions makes life simpler for small and
medium businesses in the Commercial Road Transportation industry across Europe
through its unique combination of payments solutions, seamless technology, a
data-driven digital eco-system and high-quality customer service.
http://www.eurowag.com (http://www.eurowag.com)

 

 

 

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