REG - Wise PLC - 1st Quarter Results

WiseAnnouncement

16/07/2024 07:00

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RNS Number : 4894W  Wise PLC  16 July 2024

 

Customer growth continues to drive volume and underlying income growth

 

●     26% YoY growth in quarterly active customers to 8.4m, driven by
strong customer retention and new customers joining as a result of
recommendations.

●     Volumes increased 18% YoY (20% on a constant currency basis) to
£33.2bn, driven by the continued growth in active customers, while we reduced
fees with the cross border take rate reducing c.5% to 64 bps YoY (down from 67
bps in Q4 FY24).

●     Underlying income grew 22% YoY to £325.4m, with continuing growth
in deposit balances (23% YoY) and strong card and other revenue growth (55%
YoY).

●     Continuing to expect strong growth in FY25 with underlying income
expected to grow 15-20% over FY24.

●     Focus remains on the long term opportunity to grow cross border
volumes while targeting an underlying profit before tax margin of 13-16%.

 

We're pleased to start the new financial year on a positive note, with strong
momentum in active customer and volume growth. We remain committed to offering
the lowest possible price for moving and managing money internationally, a key
pillar of our mission and a significant driver of business growth. In Q1, we
reduced fees for customers with our cross border take rate at 64 bps in Q1
FY25, c5% lower fees on average compared to last quarter. This reduction was
made possible through our efforts to improve efficiency and represents another
investment into our long term growth.

 

This quarter, we were thrilled to announce our first Wise Platform partnership
in Brazil with Nubank, one of the world's largest digital banking platforms.
Meanwhile, our partnership with Qonto in Europe is simplifying international
payments for over 500,000 SMEs and freelancers.

 

-Kristo Käärmann, Co-founder and Chief Executive Officer

 

                                 Q1 FY25  Q1 FY24  YoY Movement
 Volume (£ billion)              33.2     28.2     18%
 Underlying income (£ million)   325.4    266.9    22%
 Cross-border take rate (%)      0.64%    0.67%    -3 bps
 Instant transfers (%)           59%      57%      +2 pps

 

You can read more about our progress in our quarterly Mission Updates on
wise.com.

 

Please see the appendix for further historical financial information.

 

 

 

 

 

 

Enquiries

Martin Adams / Lawrence Nates - Investor Relations

owners@wise.com (mailto:owners@wise.com)

 

Sana Rahman - Communications

press@wise.com

 

Brunswick Group

Charles Pretzlik / Sarah West / Nick Beswick

Wise@brunswickgroup.com

+44 (0) 20 7404 5959

 

About Wise

Wise is a global technology company, building the best way to move and manage
the world's money. With Wise Account and Wise Business, people and businesses
can hold over 40 currencies, move money between countries and spend money
abroad. Large companies and banks use Wise technology too; an entirely new
network for the world's money.

 

Co-founded by Kristo Käärmann and Taavet Hinrikus, Wise launched in 2011
under its original name TransferWise. It is one of the world's fastest growing
tech companies and is listed on the London Stock Exchange under the ticker
WISE.

 

In fiscal year 2024 Wise supported around 13 million people and businesses,
processing approximately £118bn billion in cross-border transactions, and
saving customers over £1.8 billion.

 

A glossary of terms can be found in our annual report and accounts
(https://wise.com/imaginary-v2/images/3f1628373b212ca54c1ac73c68d69b72-WISE-2024-Annual-Report-and-Accounts.pdf)
.

 

FORWARD LOOKING DISCLOSURE DISCLAIMER

This report may include forward-looking statements, which are based on current
expectations and projections about future events. These statements may
include, without limitation, any statements preceded by, followed by or
including words such as "forward looking", "guidance", "target", "believe",
"expect", "intend", "may", "anticipate", "estimate", "forecast," , "project",
"will", "can have", "likely", "should", "would", "could" and  any other words
and terms of similar meaning or the negative thereof. These forward-looking
statements are subject to risks, uncertainties and assumptions about Wise and
its subsidiaries. In light of these risks, uncertainties and assumptions, the
events in the forward-looking statements may not occur.

Past performance cannot be relied upon as a guide to future performance and
should not be taken as a representation that trends or activities underlying
past performance will continue in the future, and the statements in this
report speak only as at the date of this report. No representation or warranty
is made or will be made that any forward-looking statement will come to pass
and there can be no assurance that actual results will not differ materially
from those expressed in the forward-looking statements.

Wise expressly disclaims any obligation or undertaking to update, review or
revise any forward-looking statements contained in this report and disclaims
any obligation to update its view of any risks or uncertainties described
herein or to publicly announce the results of any revisions to the
forward-looking statements made in this report, whether as a result of new
information, future developments or otherwise, except as required by law.

Appendix - Historical Financials

 

 Quarterly                           Q1 FY2023  Q2 FY2023  Q3 FY2023  Q4 FY2023  Q1 FY2024  Q2 FY2024  Q3 FY2024  Q4 FY2024  Q1 FY2025  QoQ        Q YoY

                                                                                                                                        Movement   Movement
 Active customers (thousand)         4,997      5,484      5,793      6,125      6,670      7,232      7,512      7,911      8,374      6%         26%
 Personal (thousand)                 4,711      5,182      5,475      5,784      6,307      6,847      7,120      7,517      7,962      6%         26%
 Business (thousand)                 286        302        319        340        363        385        392        395        412        4%         13%

 Cross border volume (£ billion)¹    24.4       27.0       26.4       26.7       28.2       29.2       30.6       30.6       33.2       9%         18%
 Personal (£ billion)                18.0       20.1       19.0       19.5       20.8       21.6       22.3       22.6       24.5       9%         18%
 Business (£ billion)                6.3        6.9        7.4        7.3        7.4        7.6        8.3        8.0        8.7        8%         17%

 Customer balances (£ billion)       7.7        9.2        10.1       10.7       11.5       12.3       12.9       13.3       14.1       6%         23%
 Personal (£ billion)                3.9        4.9        5.4        5.8        6.5        7.0        7.5        7.9        8.5        8%         31%
 Business (£ billion)                3.8        4.3        4.7        4.9        5.0        5.3        5.4        5.4        5.6        5%         12%

 Cross border revenue (£ million)    149.5      171.0      181.3      177.7      187.9      196.5      206.2      204.6      211.2      3%         12%
 Personal (£ million)                119.1      135.9      141.5      139.7      149.0      154.7      161.2      161.0      167.1      4%         12%
 Business (£ million)                30.4       35.1       39.8       38.0       38.9       41.8       45.0       43.6       44.1       1%         14%

 

1.         Cross border volume only.  On a constant currency basis,
cross border volumes for Wise, its personal segment and its business segment
grew 9%, 9%, 8% respectively versus the prior quarter, and 20%, 20%, 19%
compared to the same quarter in the previous year.

 

Note: Differences between 'total' rows and the sum of the constituent
components of personal and business are due to rounding.

 

 

 

 

 

 

 

Appendix - Historical Financials (continued)

 

 Quarterly                                                   Q1 FY2023  Q2 FY2023  Q3 FY2023  Q4 FY2023  Q1 FY2024  Q2 FY2024  Q3 FY2024  Q4 FY2024  Q1 FY2025  QoQ        Q YoY

                                                                                                                                                                Movement   Movement
 Card and other revenue (£ million)                          36.4       40.5       43.9       45.8       51.6       62.2       70.4       72.6       80.0       10%        55%
 Personal (£ million)                                        25.3       28.9       32.2       33.7       37.4       46.1       51.9       54.0       59.6       10%        60%
 Business (£ million)                                        11.1       11.6       11.7       12.1       14.2       16.1       18.5       18.6       20.4       10%        43%

 Underlying interest income (first 1pct yield) (£ million)   -          -          24.2       25.4       27.4       29.7       31.3       32.3       34.2       6%         25%
 Personal (£ million)                                        -          -          13.0       13.7       15.2       16.9       18.0       19.0       20.4       8%         34%
 Business (£ million)                                        -          -          11.2       11.7       12.2       12.8       13.3       13.3       13.8       4%         13%

 Underlying income (£ million)                               183.2      210.6      249.4      248.8      266.9      288.4      307.9      309.5      325.4      5%         22%
 Personal (£ million)                                        143.0      164.3      186.7      187.0      201.6      217.7      231.1      234.0      247.1      6%         23%
 Business (£ million)                                        40.2       46.3       62.7       61.8       65.3       70.7       76.8       75.5       78.3       4%         20%

 Interest income (above the first 1pct yield) (£ million)    3.9        18.4       22.2       46.1       68.3       85.7       100.9      109.6      114.3      4%         67%
 Personal (£ million)                                        2.0        9.6        11.9       25.0       37.9       48.7       58.0       64.3       68.0       6%         80%
 Business (£ million)                                        1.9        8.8        10.3       21.1       30.4       37.0       42.9       45.3       46.3       2%         52%

 Benefits paid relating to customer balances (£ million)     -          -          (2.9)      (15.5)     (24.3)     (29.0)     (33.7)     (37.9)     (41.3)     9%         70%
 Personal (£ million)                                        -          -          (1.7)      (9.0)      (14.1)     (16.9)     (19.1)     (22.6)     (24.8)     10%        75%
 Business (£ million)                                        -          -          (1.2)      (6.5)      (10.2)     (12.1)     (14.6)     (15.3)     (16.5)     8%         62%

 Cross border take rate (%)                                  0.61%      0.63%      0.69%      0.67%      0.67%      0.67%      0.67%      0.67%      0.64%      -3 bps     -3 bps

 

Note: Differences between 'total' rows and the sum of the constituent
components of personal and business are due to rounding.

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