Network International Holdings Q4 2020 trading update

Continued improvement in trading and full year outturn ahead of expectations


Network International Holdings plc, the leading enabler of digital commerce across the Middle East and Africa, provides an update on trading performance in the fourth quarter of the financial year. Unless otherwise stated, all growth figures reflect the Q4 2020 period compared with Q4 2019.

  • FY20 revenue ahead of guidance, totalling USD284m. Underlying EBITDA1 also anticipated to be slightly ahead of market expectations
  • Q4 2020 total revenue (19)% y/y, although absolute revenues in Q4 were higher than Q3, reflecting the continuing recovery in card and digital transactions across our markets, and particularly encouraging trading in December

·        Q4 Merchant Solutions revenue (31)% y/y, exiting 2020 with domestic TPV equal to prior year

  • Strong TPV growth from online merchants of 68% y/y (excluding Government and airline online TPV) within directly acquired Total Processed Volume (TPV) growth of (18)% y/y
  • In direct TPV, domestic volumes improved, down (3)% y/y, and we saw a full recovery to 2019 levels as we exited the year. International volumes were down (61)% y/y due to tougher comparables, but we saw a stronger than expected recovery in UAE tourism
  • Take rates were lower y/y; reflecting merchant sector mix, the regulatory impact on acquiring fees in Jordan, and higher non-TPV related revenue streams in the prior year
  • Q4 Issuer Solutions revenue (13)% y/y, against a strong comparator in the prior year. Absolute revenues were higher than the Q3, reflecting improving KPIs across cards and transactions
  • DPO’s strong revenue growth continues, with over 30%2 Q4 TPV growth in constant currency
  • Balance sheet remains strong and we are comfortably inside financial covenants Total liquidity position of cUSD325 million, comprised of cUSD190 million in undrawn lending facilities and a cash balance of cUSD135 million (excluding the funds raised for the DPO acquisition)

·        New products and market entry delivered:

  • Mastercard partnership collaborations: new digital platform and corporate card products launching, which will support the acceleration towards digital payments across all our markets
  • Africa: new market entry to Sudan in conjunction with Mastercard, providing Issuer Solutions services to Faisal Islamic Bank
  • Middle East: renewed our contract with ADCB for fully outsourced Merchant Solutions services; and signed new merchants and partnership arrangements with several global brands in the online acquiring space.

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