(Adds details, background, CEO comments)
By Arathy S Nair
March 7 British payment processor Worldpay Group
Plc on Tuesday said revenue for the full year was lower
than expected, hurt by weakness in its U.S. business.
Worldpay, which provides platforms to allow merchants to
accept payments by cards and other methods, said its performance
in the U.S. was "subdued" with second-half revenue being softer
The industry has become extremely competitive in recent
years as payments are increasingly routed electronically,
including through cards and mobile wallets.
Net revenue from its U.S. business, which accounts for more
than a quarter of the company's revenue, rose 15.5 percent to
$299 million, though average transaction value was down 2.2
percent at $39.50.
"Worldpay is struggling in the U.S.... As a result, the
whole group's profitability is under pressure," Richard-Maxime
Beaudoux, an analyst at Brian Granier & Co, wrote in a note.
However, chief executive Philip Jansenn ruled out any plans
to sell the U.S. business.
The company will continue to focus on small businesses and
corporates and offer integrated payments through partnership
sales, he told Reuters.
The payment processing industry in the U.S. has seen some
consolidation with Global Payments Inc buying smaller
rival Heartland Payment Systems Inc for $4.3 billion last year
to expand its merchant base.
Worldpay also maintained its medium-term outlook for
compound annual net revenue growth of 9 percent to 11 percent.
Worldpay's total transaction value in 2016 rose 11.6 percent
to 451.1 billion pounds ($551.83 billion), as it processed 14.9
billion transactions, up from 13.1 billion a year earlier.
Global e-commerce payments revenue, which accounts for more
than a third of Worldpay's total, rose 21.7 percent to 386.6
million pounds, driven by new business wins and strength in its
global retail and digital content units.
Worldpay's underlying earnings before interest, taxes,
depreciation and amortization rose 15.1 percent to 467.6 million
pounds for the year ended Dec. 31.
Analysts had expected underlying earnings of 374.64 million
pounds, according to Thomson Reuters I/B/E/S.
The company's net revenue rose 14.5 percent to 1.12 billion
pounds, but missed analysts estimates of $1.13 billion.
Worldpay's shares fell as much as 4.4 percent to $263 in
($1 = 0.8179 pounds)
(Reporting by Arathy S Nair in Bengaluru; Editing by Amrutha
Gayathri and Sunil Nair)