Worldline confirms guidance as merchant services volumes boost Q3

Oct 25 (Reuters) – French payments company Worldline (WLN.PA) confirmed its full-year outlook on Tuesday as it posted quarterly revenue slightly ahead of expectations driven by volume growth and market share gains in its merchant services business.

The group, which operates digital payment and transactional solutions, posted third-quarter revenue of 1.16 billion euros ($1.14 billion), which was a 10% increase organically and ahead of the 1.14 billion euros forecast on average by analysts polled by the company.

Payments processing firms have seen a surge in business as more people switched to digital transactions during the pandemic, but analysts had anticipated that the squeeze on discretionary and e-commerce spending due to rising costs this year could weigh on the sector’s revenues.

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Worldline, whose clients range from merchants to government agencies, is seeing consumption holding up across all its segments despite the tense economic context, said Chief Executive Officer Gilles Grapinet, adding the group has not observed any slowdown in travel so far and booking levels “remain good”.

Worldline’s decision to close its activities in Russia in February cost it almost 3 percentage growth points at merchant services level in the third quarter, finance chief Gregory Lambertie told analysts.

“Ongoing inflation (where payments services providers such as Worldline are beneficiaries) and the return of travel and that growth more than offset the exit from Russia”, said JPMorgan in a client note on the revenue increase in the merchant services segment.

Worldline confirmed its full-year guidance for organic revenue growth between 8% and 10% and an improvement of earnings before depreciation and amortisation margin by 100 to 150 basis points.

“We know that we’ve been performing well that we will end up probably in any case at the top end of the guidance”, said deputy chief executive Marc-Henri Desportes, adding the group is continuing to see “a story dynamic” at the beginning of the fourth quarter.

($1 = 1.0121 euros)

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Reporting by Elena Vardon and Juliette Portala; Editing by Jacqueline Wong, Kim Coghill and Mike Harrison

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