October 9, 2018 / 6:13 AM / 2 months ago

UPDATE 3-Wirecard spells out vision for further growth to investors

* Sees EBITDA of at least 3.3 billion euros in 2025

* Confirms guidance for this year and for 2020

* Forecast represent lower bound of range - CEO

* Shares rise 3 percent (Adds CEO comments to investor event)

By Tommy Wilkes and Jörn Poltz

LONDON/MUNICH, Oct 9 (Reuters) - Fresh from its promotion to Germany's blue chip share index, fintech company Wirecard said on Tuesday it expects core profits to grow sixfold by 2025 thanks to a boom in e-commerce and digital payments.

Wirecard, founded in 1999, is the leading German player in a payments sector that is rapidly expanding as established banks struggle to shake off the legacy of the global financial crash a decade ago.

Earnings before interest, taxation, depreciation and amortisation (EBITDA) are forecast to exceed 3.3 billion euros ($3.79 billion), according to a Vision 2025 strategy presented at an investor day in London.

That view is conservative, CEO Markus Braun told Reuters. "All the figures that we are giving represent the bottom end of the range - I want to stress that," he said in an interview ahead of the event.

Addressing investors, Braun said the long-term forecast implied an acceleration in top-line growth to an annual rate of 27 percent from 23-24 percent previously.

He also said Wirecard "could perhaps double" its so-called take rate -- or the cut it charges on transactions -- over that period. But it would not have been professional to reflect that in the long-term forecast, he added.

The economics of digital platforms mean that margins tend to expand as they build scale, often favouring the emergence of a dominant player. Some analysts and investors attending the event cautioned, however, that ever-more frictionless commerce would also make it easy for Wirecard's clients to switch to rivals.

The long-term outlook compares with EBITDA guidance for this year of between 530 and 560 million euros, which Wirecard confirmed along with its existing forecasts for 2020.

Shares traded 3 percent higher in Frankfurt at 171 euros after giving back some earlier gains, with Wirecard the biggest gainer on the DAX.

Knut Woller, analyst at Baader Helvea, said the long-term outlook confirmed his view that an acceleration of internally generated profit growth in the first half of this year "was not a 'one-hit wonder'".

Woller has a 'buy' rating on the stock with a price target of 198 euros.

'VOICE' COMMERCE

The company recently ousted Commerzbank from the blue-chip DAX index thanks to a rise of 84 percent in its shares this year. More broadly, the digital payments sector led by Paypal is in vogue with investors.

It has not always been such smooth progress for Wirecard, which for years struggled to shake off a sleazy image as a payments provider for online porn and gambling sites, and more recently came under attack from speculative short sellers that are under investigation by state prosecutors.

To maintain momentum, the company will focus on bringing together online, mobile and point-of-sale payments.

Braun said that Wirecard's end-to-end solutions positioned it to profit from the shift from cash - which still accounts for 80-85 percent of transactions worldwide - to digital payments.

"This convergence from the point of sale to the electronic point of sale will be a very large growth driver for us," he said.

Braun, whose 7 percent stake in the company is worth $1.7 billion, saw opportunities in value-added services, such as allowing merchants to offer loans or insurance to customers when they make purchases via their smartphones or in stores.

Data-driven analysis of consumers' purchasing habits should also make it possible to make more targeted sales offers, increasing turnover both for merchants and Wirecard, he said.

Braun also said he saw 'voice' commerce using digital assistants such as Amazon.com's Alexa as a promising new growth channel.

In 2025, Wirecard expects transaction volumes to increase to more than 710 billion euros, while revenues are expected to reach at least 10 billion euros.

That implies a take rate of 1.4 percent - a fractional rise from Wirecard's existing forecast that transaction volumes will top 215 billion euros in 2020 on revenues of more than 3 billion euros. ($1 = 0.8699 euros) (Editing by Maria Sheahan and Keith Weir)

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