Wirecard quarterly profit strength meets expectations

Technology

FILE PHOTO: The headquarters of Wirecard AG, an independent provider of outsourcing and white label solutions for electronic payment transactions is seen in Aschheim near Munich, Germany April 25, 2019. REUTERS/Michael Dalder/File Photo

BERLIN (Reuters) – Payments company Wirecard reported strong quarterly results in line with analyst expectations on Friday and reiterated guidance for core profit growth of 34% this year.

There was no update on an outside audit to address Financial Times allegations of fraud and false accounting that have dogged the Munich-based company over the past year. KPMG is due to report its findings by the end of March, Wirecard has said.

Chief Executive Markus Braun has denied the allegations, which were made in a series of investigations by FT reporter Dan McCrum and have prompted Singapore police to raid Wirecard’s local offices and sparked a legal battle between Wirecard and the newspaper.

The company’s shares, which have rallied by 28% since the start of the year on the absence of any negative news around the KPMG investigation, were down 1.1% in early Frankfurt trade.

Commenting on the financial update, Braun said: “This is a strong result on our path for profitable growth. Above all, it is very clear evidence of the sustained profitability of our business model.”

Wirecard forecast core profit of 1 billion to 1.12 billion euros ($1.08 billion to $1.21 billion) this year. At the mid-point, that implies growth of 34% from the 794 million euros it made in 2019.

Fourth-quarter adjusted earnings before interest, tax, depreciation and amortization (EBITDA) came in at 241 million euros, up 46% year on year and in line with expectations in a Refinitiv poll of analysts.

The results were preliminary and Wirecard will publish audited figures on April 8.

Reporting by Douglas Busvine; Editing by Michelle Martin and David Goodman

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