Shares in French payments processor Worldline slipped in early morning trading after the company reported a net loss due to a €1.15 billion impairment charge in merchant services and a deteriorating outlook.
The company reported a "net loss group share" of €817 million for 2023, compared with a €211 million profit a year earlier. It also reported a 6% rise in full-year revenue, in line with revised guidance.
Merchant services experienced a contrasted performance between a good first half and a second half of the year. This was due in particular to the economic and consumption slowdown in Europe, which further deteriorated during the fourth quarter versus the third quarter. In financial services, the firm reported a 1.3% decline in revenue due to the low conversion of pipeline opportunities.
Worldline says the impairment in merchant services was based on "conservative assumptions reflecting the change in valuation paradigm in the payments’ Industry".
The firm in February instituted a cost-cutting programme, taking the axe to 1400 jobs. The Power24 plan will cost around €250 million but deliver a €200 million run-rate cash costs savings from 2025, says the firm.
Last October, Worldline's share price plummeted after the vendor warned of a deteriorating outlook for sales and the termination of a number of merchant relationships due to soaring cyber crime rates.
It has since been propped up by the purchase of a seven percent stake by Crédit Agricole, in a bid to keep a proposed joint venture between the two firms afloat.