February 20, 2018 / 8:00 AM / 8 months ago

UPDATE 2-France's Edenred reports record results, shares hit all-time high

* EBIT of 437 mln euros up 13.1 pct

* Dividend up 37 pct

* Expects sustained growth in Europe

* Shares hit record high (Adds analyst, shares)

By Dominique Vidalon

PARIS, Feb 20 (Reuters) - French prepaid meal voucher and card provider company Edenred on Tuesday handed investors a 37 percent dividend hike and delivered record 2017 earnings, lifting its shares to all-time highs.

Edenred, which helps firms manage staff expenses and benefits and is best known for its “Ticket Restaurant” vouchers, also expressed confidence that 2018 would be another year of sustained growth for its business in Europe and Latin America even as economic conditions in Brazil remained challenging.

“This is a new record year with all key indicators at historic levels and in comparable terms we are ahead of our targets,” Chief Executive Bertrand Dumazy told journalists.

“The performance achieved in 2017 confirms that Edenred has set itself on a course of profitable and sustainable growth,” he said.

Earnings before interest and tax (EBIT) rose to 437 million euros ($541 million) from 370 million, said Edenred, which competes with caterers Sodexo and Compass as well as credit card networks MasterCard and Visa.

That was slightly above estimates for an EBIT of 430 million euros in a ThomsonReuters I/B/E/S poll, while Edenred’s own guidance had been 420-445 million euros.

Revenue rose 17.6 percent to 1.34 billion euros

It raised its dividend to 0.85 euros per share, beating forecasts and helping Edenred shares to a record high of 28.64 euros. They were up 7.1 percent at 27.49 euros by 0910 GMT.

“This morning Edenred released solid 2017 results, slightly above consensus,” wrote analysts at brokerage Kepler Cheuvreux, who retained a “hold” rating on the shares.


Edenred, which employs 8,000 people in 45 countries, sells prepaid meal vouchers that employers offer to workers, but its development of products such as fuel cards aims to tap into a sector that is growing faster than other employee benefits as companies seek to control business expenses more effectively.

Its ‘Employee Benefits’ division now makes 65 percent of revenue while Fleet and Mobility Solutions 25 percent of revenue against 14 percent in 2015, it said.

The company is also accelerating its shift from paper-based vouchers towards digital cards in order to cut costs.

At the end of 2017, digital solutions accounted for 78 percent of Edenred’s business volume, up 8 percentage points from 2016 and on track to meet a target of 85 percent in 2020.

Edenred added it expected more strong growth in 2018 in Latin America, which makes up 41 percent of its business, even though conditions remained challenging in Brazil, which is emerging from recession.

Edenred, whose recent acquisitions include buying a Slovakian meal voucher company and acquiring a 51 percent stake in a Poland-based fuel card distribution firm, added it would consider further acquisitions this year.

For 2018, the company confirmed its medium-term objectives of like-for-like growth in operating revenue of more than 7 percent and operating EBIT growth of more than 9 percent.

Edenred shares rose 28 percent last year and are up around 14 percent in 2018 versus a flat Paris SBF-120 index.

$1 = 0.8078 euros Reporting by Dominique VidalonAdditional reporting by Blandine Henault; editing by Sudip Kar-Gupta and Jason Neely

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