Regulatory News

Continued Strong Growth, US market access now live

Equals, the e-banking and payments group, is pleased to provide the market with a trading update for the six-month period ended 30th June 2019.

The Group has continued to deliver on its strategy in the first half of the year which has resulted in further strong growth. The Group's ongoing investment in technology has led to improvements in Customer Experience (CX) and new products being developed, which will underpin further expansion of the business in the second half on 2019 and beyond. We have also successfully completed our rebranding which reflects the diversification of the business over the last two years.

Turnover* for the first half was up 17.5% year on year to £1.3 billion (2018: £1.1 billion), in line with management expectations. Overall revenue margins were slightly improved as the positive effects of supply change rationalisation outweigh the impact of growth being strongest in lower margin products.

Growth in the usage of corporate expenses product has accelerated with a 34.7% increase to £102 million (2018 H1: £75 million), driven by the roll-out of improved Customer Experience (CX) and new functionality.

International payments turnover increased 14.4% year-on-year to £636.3 million, reflecting continued success of the cross-selling within the Group.

Travel money turnover (retail cards and travel cash) is down 8.9% for the period at £158 million (2018 H1: £173 million), principally due to the Group deciding to cancel some low margin travel cash affiliate partnerships. As such, the impact on revenue is expected to be minimal.

Banking turnover rose 36.7% to £358.6 million, driven by significant growth in business banking as the CX of the platform improves. This turnover growth is expected to continue as the investment in the banking platform yields further benefits through improved payment functionality including direct Faster Payments access, enhanced CX and new products including lending via our Credit Broker licence.

In addition, the Group has now entered into a contract with Metropolitan Commercial Bank (MCB) which gives access to the US market. Utilising MCB's US regulatory status means Equals now has US domestic clearance accounts and can service both retail and corporate clients for international payments. Furthermore, now the regulatory process is complete, work can commence to launch our "Equals Spend" Corporate platform in the USA later in 2019.

The focus for the second half of 2019 is to continue the Group's strategy of building scale and extracting efficiencies in its supply chain combined with rolling out a series of exciting new products under the new Equals brand.

The strong first half combined with the new product pipeline and successful introduction of the Equals brand gives the Board confidence that the Company will achieve full year market expectations. 

Equals CEO, Ian Strafford-Taylor, commented: 

"The performance of Equals during the first half of 2019 clearly demonstrates the success of the Group's strategy and its diversified and evolving business model. The wider regulatory permissions we now have both in the UK and the US combined with the depth of our connectivity to the payment networks will enable us to continue our growth in 2019 and beyond."

* Turnover is defined as gross value of currency transactions sold plus gross value of deposits into bank accounts.

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About Equals

Equals is a leading challenger brand in banking and payments that disintermediates the incumbent banks with a superior user experience and low-cost operating model. Our business enables personal and business customers to make easy, low-cost payments both domestically and in a broad range of currencies and across a range of products all via one integrated system. The Equals platform facilitates payments either direct to Bank Accounts or at 35 million merchants and over 1 million ATM's in a broad range of countries globally via Mobile apps, the Internet, SMS, wire transfer and MasterCard/VISA debit cards.

Equals provides money movement services to both personal and business customers through four channels: Currency Cards, Physical Currency, International Payments and Bank Accounts. The Currency Card and Physical Currency offerings facilitate multiple overseas payments at points of sale and ATM's whereas the International Payments channel supports wire transfer foreign exchange transactions direct to Bank Accounts. For Corporates, Equals has a market-leading business-expenses solution based around its corporate platform and prepaid card. This service can yield significant savings on a Corporate's expenses and procurement both domestically and overseas, through better controls and improved transparency. The platform also streamlines the downstream administrative processes and integrates into accounting software, thus saving costs. Equals offers retail and business bank accounts with all the functionality you would expect from a bank, namely faster payments, BACs, direct debits, international payments and a debit card.