Shares in money transfer company Wise (WISE) surged 17% higher on Tuesday to 615.7p after raising growth and margin guidance for year ending 31 March 2024.

Over the last year the shares are up around 65% but they remain well shy of the £11 levels achieved in October 2021.

Over the 12 months through March the business served around 10 million active customers representing year on year growth of 34% and driving volumes 37% higher to £104.5 billion.

Revenues increased by half to £846 million and pretax profit surged to £146.5 million from £43.9 million in 2022. Adjusted EBITDA (earnings before interest, tax, depreciation and amortisation) almost doubled to £238.6 million.

EBITDA margins as a percentage of revenue increased 2.9% to 24.7% as the company benefited from higher interest rates and increased profitability from more customers using the Wise account.

More than a third of personal customers and 55% of business customers are using their Wise account for more than just sending money internationally, the company said.

WHAT DID THE CEO SAY?

CEO and co-founder Kristo Käärmann commented: ‘At Wise we are laser focused on our mission of money without borders and building the products that our customers need.

‘Over the past year, we continued to invest in our infrastructure and launched new features, such as Assets, to make moving and managing money faster, cheaper, easier, and more transparent for more people and businesses around the world.

‘Today, 55% of our payments reach their recipient in less than 20 seconds and we save our customers an estimated £1.5bn* in fees annually.’

RAISED GUIDANCE

The company increased income growth guidance for 2024 to between 28% and 33% and expects income to grow at a compound annual growth rate above 20% over the medium term.

EBITDA margins are anticipated to be at or above 20% over the medium term but higher in 2024 due to a higher proportion of interest income.

Davy’s estimates the market was anticipating growth at the lower end of the range at around 27.6% which implies upward revisions to analysts’ forecasts.

Davy’s commented: ‘An 18% decline in the equity over the past two weeks has left it near the bottom of the £5-6 range in which it has traded for the last six months. We view this as related to top-line growth concerns; in particular, soft web/app user data in April and May.’

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