New financial operating segment disclosures
16th February 2023: Network International Holdings Plc
New financial operating segment disclosures
We have updated our financial segment reporting to align with operational responsibilities. The change will be reflected in the 2022 preliminary results on 9th March 2023 and Annual Report and Accounts.
New financial segments will be classified according to customer groups and comprised of 'Merchant Services' which directly serves merchants (previously known as Merchant Solutions); and 'Outsourced Payment Services' where we serve financial institutions (FIs), fintechs and other customers (previously known as Issuer Solutions).
The main adjustment is the movement of acquirer processing revenues out of the business line previously known as Merchant Solutions into the newly classified Outsourced Payment Services business line1. We will continue to report the Group's geographical revenue split for information purposes, in line with prior years.
We present 2022 and 2021 revenue for the new segments, which is for information purposes and remains subject to the completion of year-end statutory audit process. The comparative segmental results for 2021 have been restated on this new basis.
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U SD millions |
2022 |
2021 |
y/y growth |
|
Merchant Services r evenue2 |
183.3 |
129.7 |
41% |
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|
|
|
|
Outsourced Payment Services r evenue |
242.5 |
214.1 |
13% |
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Other revenue3 |
12.5 |
8.51 |
48% |
Merchant Services, 42% of 2022 revenue: Where we maintain direct relationships with merchant customers and PSPs (Payment Service Provider businesses), enabling merchants to accept digital payments. Merchant Services spans the UAE, Jordan, across Africa (DPO Group) and newly launched services in Egypt. (DPO Group performance will not be reported separately going forward, after our 2022 preliminary results).
Outsourced Payment Services, 55% of 2022 revenue: Where we support FIs, fintechs and other customers in over 50 countries across two main business lines:
i) Issuer processing: Where we support payment credential issuing customers in enabling their consumers to 'make payments' by managing and processing their consumer payment credentials and transactions. Issuer processing represents the majority of revenue within Outsourced Payment Services.
ii) Acquirer processing: Where we enable FIs, fintechs, and indirectly, their merchant customers, to 'take payments' from consumers. Within acquirer processing, our clients maintain the relationship with the merchants, whilst we provide digital payment acceptance, transaction processing and other operational services.
1. The only other adjustment to reporting relates to Diners revenue which has been moved into the new Outsourced Processing Services business line. 2021 'other' revenue has been restated on this basis.
2. Merchant Services includes revenue from DPO Group, having completed the acquisition on 28th September 2021. There is therefore a three-month contribution to the 2021 financials and twelve months in 2022.
3. Other revenue primarily includes cash advance fees on withdrawals from ATMs, and foreign exchange gains / (losses) arising from the Merchant Services and Outsourced Payment Services business lines, alongside revenues recognised as part of the Mastercard strategic partnership.
Upcoming events
· FY22 preliminary results announcement: 9th March 2023
· Q1 2023 trading statement: 19th April 2023
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Investor Relations enquiries |
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Network International |
InvestorRelations@Network.Global |
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Amie Gramlick, Head of Investor Relations |
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Media enquiries |
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Teneo |
NetworkInternational@Teneo.com |
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Ben Foster, Andy Parnis |
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Forward Looking Statements
This announcement contains certain forward-looking statements with respect to the financial condition, results or operation and businesses of Network International Holdings Plc. Such statements and forecasts by their nature involve risks and uncertainty because they relate to future events and circumstances. There are a number of other factors that may cause actual results, performance or achievements, or industry results, to be materially different from those projected in the forward- looking statements.
These factors include general economic and business conditions; changes in technology; timing or delay in signing, commencement, implementation and performance of programmes, or the delivery of products or services under them; industry; relationships with customers; competition; and ability to attract personnel. You are cautioned not to rely on these forward-looking statements, which speak only as of the date of this announcement. We undertake no obligation to update or revise any forward-looking statements to reflect any change in our expectations or any change in events, conditions or circumstances.
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