Trading Update
13 March 2009 - 6:00PM
UK Regulatory
TIDMNEO
RNS Number : 7995O
Neovia Financial PLC
13 March 2009
+---------------------------+---------------------------+---------------------------+
| 13Mar09 | | For immediate release |
| Press release | | |
+---------------------------+---------------------------+---------------------------+
NEOVIA Financial Plc
NEOVIA Financial 2008 Forth Quarter Trading Update
Friday, 13 March 2009 - NEOVIA Financial Plc (LSE: NEO) (NEOVIA or the Group),
the independent global online payments business, announces its trading update
for the fourth quarter and year ended 31 December 2008.
The Group has continued to make progress in the fourth quarter of 2008, with
trading proving resilient in what has been a challenging period in the
marketplace. Revenue for the fourth quarter is anticipated to be around US$ 21.3
million (all figures herein subject to final audit), an increase of 31% from Q4
2007 revenue of US$ 16.2 million, and compared to US$ 19.1 million for the third
quarter of 2008. Fee income, which excludes interest, increased by 43% over Q4
2007 to $19.8 million. Interest income, as expected, decreased from $2.4 million
in Q4 07 to $1.5 million in Q4 08, a drop of 38%. Despite the current economic
downturn, the Group recorded a slight increase in active e-wallet users in the
fourth quarter, up to 97,673 from 97,448 in the previous quarter. The Group has
commenced a number of programmes aimed at stimulating further active e-wallet
user growth in 2009 and has made encouraging gains in diversification into new
market sectors.
The Board expects that the Group will report operating profit, before any
impairment losses or restructuring costs, for the full year 2008 in line with
market expectations. Results for the full year will be impacted by a number of
non-recurring items, including approximately US$ 1.1 million in restructuring
expenses pertaining to the cessation of the North American-facing business,
which cessation occurred in Q1 2007, and a non-cash expense relating to
impairment of the goodwill and intangible assets arising on the acquisition of
Netbanx Limited in 2005. Goodwill and intangible assets amounting to US$ 14.5
million may be subject to part or full impairment. The Group also recorded tax
recoveries of US$ 2.1 million in Q4 2008 in relation to favourable assessments
of prior periods.
During the second half of 2008, NEOVIA implemented several initiatives to
enhance its position in the online payments space, including the launch of the
Net+ prepaid MasterCard products, the enhanced NEOVIA payment network, and the
roll out of further currencies, countries and payment options for e-wallet users
and merchant customers. NEOVIA has also continued to invest in its business, in
line with its strategic objectives, with further progress achieved on the
"NewTeller" platform development project, which is currently scheduled for
deployment in Q3 2009. The future benefits of "NewTeller" will include cost
savings and greater operating efficiencies within the Group.The Group continues
to focus on further reduction of its cost base through additional restructuring
and geographical optimization of cost centres.
As at 31 December 2008, total Group cash was approximately US$ 82.3 million,
which includes restricted cash surpluses and the excess of EU customers'
qualifying liquid assets over balances payable. The working capital position of
the Group, defined as current assets less current liabilities, is approximately
US$ 68 million. Required cash inventory comprising amounts held at processors,
operating account balances to cover payouts and the buffer on trust accounts is
approximately US$ 30.0 million, resulting in available "free cash" of about US$
38.0 million. A substantial portion of this available cash is earmarked for
capital expenditures in 2009 (including the completion of the "NewTeller"
platform) and for the IDT acquisition referred to below.
The proposed acquisition of IDT Financial Services Holdings Limited, which was
announced on 1 December 2008, remains subject to obtaining the consent of the
Gibraltar Financial Services Commission and a further update will be made in due
course.
Following four intense years in executive roles with the Company, Ron Martin,
President & CEO of NEOVIA, will leave the Company for family reasons. Mr Martin
has agreed to remain with the Company during a transition period to facilitate
the orderly engagement of a replacement CEO. A recruitment process is being
commenced. The Board expresses its gratitude to Mr Martin for his effective
leadership during a challenging time for the Company and appreciates his
continuing support during the transition interval. The Company will advise
shareholders the exact date of his departure in due course.
NEOVIA expects to release its preliminary announcement of the 2008 audited full
year results on or around April 23, 2009.
For further information contact:
Doug Terrydial North America 1 403 769 3419
CFO, NEOVIA Financial Plc
Email:doug.terry@neovia.com
Andrew Gilchrist+ 44 (0) 1624 698 713
VP Communications, NEOVIA Financial Plc
Email:investorrelations@neovia.com
Citigate Dewe Rogerson+ 44 (0) 207 638 9571
Sarah Gestetner / George Cazenove
Daniel Stewart & Co Plc+ 44 (0) 207 776 6550
Paul Shackleton
* * * * *
About NEOVIA Financial
Trusted by consumers and merchants in over 160 countries to move and manage
billions of dollars each year, NEOVIA Financial Plc (formerly NETELLER Plc)
operates the world's leading independent online payments business. Through its
Payment Suite, featuring NETELLER , NETBANX , Net+(TM) and 1-PAY(TM) brands,
NEOVIA Financial specialises in providing innovative and instant payment
services where money transfer is difficult or risky due to identity, trust,
currency exchange, or distance. Being independent has allowed the company to
support thousands of retailers and merchants in many geographies and across
multiple industries.
NEOVIA Financial Plc is quoted on the London Stock Exchange's AIM market, with a
ticker symbol of NEO. Subsidiary company NETELLER (UK) LTD is authorised by the
Financial Services Authority (FSA) to operate as a regulated e-money issuer. For
more information about NEOVIA Financial visit www.neovia.com or contact us by
email at investorrelations@neovia.com.
NEOVIA Financial Plc recently changed its corporate identify from NETELLER Plc
to better reflect the strength and breadth of its individual product brands. At
the same time its ticker symbol changed from NLR to NEO.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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