Streamlined Group profile
The Power24 reorganisation was fully delivered in Q3, as planned.
Implementation cash costs will remain unchanged at € 250 million, and we confirm the € 220 million run rate of cash costs savings in 2025 at a minimum.
In parallel, we are executing structural actions to improve our cash generation, with particular attention to capex prioritization towards growth initiatives and a continuous decrease of Integration and rationalization costs. These actions constitute a solid base from which Worldline will accelerate its free cash flow generation in the coming years.
Ongoing execution to rebound and refocus Worldline
New leadership for Merchant Services
On October 7, 2024, Worldline announced the appointment of Paul Marriott-Clarke as the new head of Merchant Services. M. Marriott-Clarke brings extensive expertise in the world of banking and payments. He most recently led the Customer & Digital business at Barclays UK, where he drove the bank’s digital transformation, shifting the organization towards an agile and customer-centric model. He had previously served as PayPal Europe’s CEO and PayPal’s Chief Commercial Officer in the Europe, Middle East, and Africa region.
M. Marriott-Clarke will lead a Merchant Services segment that has been restructured into a more customer-focused organization around go-to markets, namely large enterprises and small and medium-sized businesses. The new management team will focus on deploying a differentiated product offering adapted to clients’ specific needs to accelerate revenue growth.
Management actions in place to address specific challenges
Worldline’s Merchant Services activity has been impacted by specific challenges, particularly in the Travel and Gaming online verticals and in APAC, for which management implemented action plans.
- In Australia, the business is not meeting our expectations. A new management team has been brought in and has started to turn the business around. Repricing actions are being implemented in agreement with Worldline’s local banking partner to factor in our cost increases and secure a return to growth in Q4.
- In the online business, revenue was held back notably by lower demand in the Travel and Gaming verticals. Consequently, dedicated actions have been put in place such as a profound work to accelerate customer onboarding, i.e. volume ramp-up of already signed customers like Google or Turkish Airlines.
- As previously indicated, the impact of merchant terminations (maximum € 130 million on annual revenue) will no longer affect the reported growth by end-Q1’25 and with already a lesser impact in Q4’24.
Investment focused on value-added product roll-outs and growth accelerators
To secure Worldline's growth rebound, we are accelerating the work already engaged in releasing new products addressing new verticals or distribution channels while reinforcing banking distribution networks through partnerships.
On the new products release side, while the Group continues to successfully expand its Tap-on-Mobile solution, new releases have been launched to address new verticals and distribution channels, such as among others:
- Leveraging the partnership with OPP, Worldline has launched an innovative Embedded Payments solution in Europe for ISV’s and marketplaces. OPP, coupled with Worldline's 50 years of payment expertise, will provide a new solution covering the full revenue ecosystem from global online acceptance to full acquiring capabilities. The solution is easy to use and integrate, flexible, fully compliant with the EU regulations particularly the GDPR, secure and flexible and comes with a full range of value-added capabilities.
- The result of a combined solution of Merchant Services and Financial Services, Worldline has launched “Bank Transfer by Worldline”, a new account-to-account payment method which will be available in 14 European countries by the end of 2024.
Regarding our banking distribution networks, the implementation of the Group’s roadmap has been pursued to open new markets (CAWL in France) or to reinforce our positions in new markets, such as Italy where we continue to grow by over 20%.
- The development of Worldline’s strategic partnership in France with the operational set-up of CAWL, our joint-venture with Crédit Agricole, is fully on-track and as per plan, and we confirmed its go live date in 2025.
- Worldline continued its geographic expansion in 2024, particularly in Italy. The CCB partnership signed in Q1’24 is a strategic development that will ramp-up at the beginning of 2025 with the full migration of circa 60,000 merchants’ portfolio on the Worldline platform. We will pursue our development in Italy, which is a very promising market and one of our highest growth contributors.
Portfolio pruning on some peripheral assets
After a decade of actively consolidating the European payments landscape, Worldline's management and Board are currently assessing the relevance of some peripheral assets in the portfolio that may not enjoy many synergies with the Group’s other businesses.
This analysis is driven by the Group’s strategic refocusing, with an objective of orderly execution to generate shareholder value.
2024 objectives confirmed
- Organic revenue growth of around 1%.
- Adjusted EBITDA of around € 1.1 billion.
- Free cash flow of around € 0.2 billion.
