eServGlobal Limited Trading Update for the half-year ended June 2018 (5960W)
02 August 2018 - 4:02PM
UK Regulatory
TIDMESG
RNS Number : 5960W
eServGlobal Limited
02 August 2018
eServGlobal Limited ("eServGlobal" or the "Company")
Trading Update for the half-year ended June 2018
2 August 2018
eServGlobal (LSE: ESG.L & ASX: ESV.AX), a pioneering digital
transactions technology company, provides the following update on
trading for the six months ended 30 June 2018 (1H18).
The Board has been encouraged that orders received for the
period exceeded forecasts at EUR7.7M and this, together with the
strong pipeline for the second half, puts the Company in a strong
position to reach the breakeven target for the year. Only EUR1.2M
of the EUR7.7M in new orders has been recognised as revenue in
1H18, with the remaining EUR6.5M to be recognised in subsequent
periods. Recognisable revenue in 1H18 is expected to be in the
region of EUR3.6M. Operating costs are around EUR2.2M below the
comparable six-month period in 2017.
The Company's results for 1H18 will be released by the end of
August, after equity accounting for eServGlobal's share of the
HomeSend operating result for the same six-month period.
Accelerating the preparation of the core business for corporate
activity, whilst further reducing the cost base, has helped
generate interest from a number of parties and conversations are
ongoing and the Company will keep shareholders informed as
appropriate.
Cash at 30 June 2018 was EUR1.8M, after allowing for increased
spend in 1H18 to ready the Company for corporate activity, with one
significant late payment being received after the half returning
the cash balance to within Board expectations at the end of
July.
The 1H18 revenues combined with total orders already booked and
expected to be recognised in the second half of the year come to
EUR7.7M. This represents 67% of the targeted EUR11.5M needed to
break even at the operational EBITDA level, indicating that the
turnaround of the core business is on track. The pipeline for the
rest of the year is centred around existing customers.
HomeSend continues to work hard to position itself for volume
acceleration through its efforts in the banking market, and the
current focus is onboarding more banks to the hub. HomeSend
recently filed its annual report in line with the Belgian Companies
Code for the year ended 31 December 2017, showing revenues of
EUR6.7M, 59% growth compared to the prior year. In the HomeSend
SCRL Financial Statements it states, "The Company is still
confident in the long term plan and does not see any sign or event
requiring any significant update. The Company foresees significant
sales expansion and expects to become profitable in the coming
years, depending on the timing required to activate pipeline
opportunities and signed customers".
(https://www.eservglobal.com/wordpress/wp-content/uploads/2018/07/HomeSend-2017-Financial-Statements-FRA.pdf)
At the fundraising in October 2017, it was expected that two
large agreements would soon be signed to exploit the HomeSend
network. One of those was signed and is expected to go live in the
September 2018 quarter, and the other remains a live situation with
the agreement still expected despite the delay.
John Conoley, eServGlobal Executive Chairman and HomeSend Board
Member, commented: "The Board is encouraged by the improving
fortunes of the core business and by the demonstrable progress in
the current financial year. The Board is pleased to see indications
of success coming through and expects to return to growth in 2018
on a continually lowering cost base. The Board is further pleased
to see the published accounts of HomeSend demonstrating continued
traction. eServGlobal remains satisfied by the prospects for
HomeSend in the larger banking market going forward."
About eServGlobal
eServGlobal (AIM:ESG, ASX:ESV) is a pioneering digital financial
transactions technology company, enabling financial and
telecommunications service providers to create smoother
transactions for their customers through deep technical expertise
and rapid implementation. Built on the latest technology platforms,
eServGlobal offers a range of transaction services including
digital wallets, commerce, remittance, recharge, rapid service
connection and business analytics. eServGlobal combines more than
30 years' experience, with an agile, future-focused mindset, to
align with the requirements of customers and partners around the
globe.
Together with Mastercard, eServGlobal is a joint venture partner
of the HomeSend global payment hub, enabling cross-border transfer
between bank accounts, cards, mobile wallets, or cash outlets from
anywhere in the world.
For further information, please contact:
eServGlobal www.eservglobal.com
Tom Rowe, Company Secretary investors@eservglobal.com
Andrew Hayward, Chief Financial Officer
Alison Cheek, VP Corporate Communications
finnCap Limited (Nomad and Broker) www.finnCap.com
Corporate Finance: Jonny Franklin-Adams / T: +44 (0) 20 7220
Anthony Adams / Hannah Boros 0500
Corporate Broking: Tim Redfern / Richard Chambers
Alma PR (Financial Public Relations) www.almapr.co.uk
John Coles / Helena Bogle T: +44 (0) 208 004
4218
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END
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