- 2022 results top market estimates
- Strong underlying trading continued into this year
- 2023 seen beating previous guidance
Small and mid-cap focused payment firm Equals Group (EQLS:AIM) delivered yet another set of forecast-beating results and revealed trading for the current year would be ‘ahead of current expectations’.
Investors snapped up the shares, pushing them higher by as much as 9p or 11% to 90p in early trading.
ANOTHER BANNER YEAR
The group generated revenue of almost £70 million last year compared to just over £44 million the previous year, a 58% improvement.
While foreign exchange (FX) and banking transactions were healthy, rising 26% and 31% respectively, the big boost came from the firm’s solutions platform which grew its activity by 137% to over £2 billion.
‘The traction we gained in 2022 and the trading momentum we possess today is a direct result of the sustained investment we have made into our platform and proposition over several years’, said chief executive Ian Strafford-Taylor.
Thanks to the wide-ranging capabilities of its platform, which is securely backed by bank-grade functionality, the group has seen ‘significantly greater’ levels of activity from its clients and is attracting larger volumes ‘from a broader array of businesses, including large corporates’.
The increase in activity and revenue drove an 94% increase in EBITDA (earnings before interest, taxes, depreciation and amortisation) from £5.7 million to £11 million and saw the company swing from a net loss of £2.3 million to a profit of £3.6 million despite ongoing investment.
MORE TO COME IN 2023
Revenue from the start of the year to 24 March hit £20.2 million, a 54% increase on the same period last year and in line with the growth posted over the previous 12 months, while per-day earnings of £342,000 were 13% up on the previous quarter.
On top of this impressive organic growth the firm has made a couple of opportunistic acquisitions which will add to revenue and earnings, meaning trading this year is likely to be better than the market is forecasting.
The deal to buy Roquett, an open banking payments platform, completed in January, since when the firm has entered into a deal to take over UK foreign exchange broker Hamer & Hamer, and today it announced the share-based acquisition of Belgian payments provider Oontex for up to £4.1 million, subject to regulatory approval.
As well as bringing new customers and new card services, the Oontex deal gives Equals a European base from which to sell its own products and services to a much bigger small and mid-cap corporate clientele.
