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(Sharecast News) - Payments technology company Network International said on Monday that it was expecting total revenue in the first half to be between $133m (£106.42m) and $134m, representing "broadly flat" performance year-on-year in the first quarter, and a fall of around 23% in the second quarter.
The FTSE 250 firm added that, looking at 2020 as a whole, it now expected a total revenue decline of between 17% and 20% on a year-on-year basis.
It said its merchant solutions division showed a "gradual recovery" through June, while issuer solutions performance remained relatively more resilient.
In the Middle East, the company said it was anticipating a gradual recovery of domestic spending through the second half, but little return of international spending, while in Africa, while the business there was more focussed on issuer solutions, the World Health Organization had indicated that Covid-19 had yet to peak.
As a result, Network said it was expecting further pressure on card issue and transaction volumes.
The board said the firm's balance sheet and liquidity remained "strong", adding that it expected to remain comfortably within its financial covenants.
It explained that it still intended to move forward with its expansion in Saudi Arabia, and on-soil data centre deployment, as soon as it was practical to do so.
Network was still working on the delivery of its strategic and business initiatives, describing "notable" new merchant wins and a partnership with the online payments services provider HyperPay.
It said it was seeing "growing demand" for its 'N-Genius' online gateway, while e-commerce volumes excluding government and airlines were up 45% year-on-year in the second quarter.
Africa business wins had "naturally slowed" in the current environment, but the company said it was confident that was temporary, with no underlying change in the appetite for banks to outsource payments processing.
The firm said the transition from cash to digital payments remained "in high growth" across its markets, where recent indicators pointed to an acceleration in that trend.
"We have continued to focus on supporting our customers and colleagues through this period," said chief executive officer Simon Haslam.
"We have enabled online payments for a large number of merchants through our proprietary N-Genius gateway, and have a strong pipeline of demand.
"Whilst Covid-19 is causing some short term disruption, we are fortunate to be operating in high growth and fragmented digital payments markets, where we are seeing signs of an acceleration in underlying trends and the long term opportunity remains significant."
Haslam said that, as "the only independent payments processor of scale" across its regions, the firm was "best-positioned" to capitalise on such opportunities.
"[This] means we continue to pursue new customers, continue discussions with banks in regard to outsourcing, and scan the market for selective acquisition opportunities.
"There is much to be excited about and we remain confident in the industry fundamentals and our strategic approach, which remains unchanged."
At 0810 BST, shares in Network International Holdings were up 3.32% at 469p.
21 Apr 2023 08:52
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