EDENRED : Third-quarter 2022 revenue - Edenred upgrades its full-year 2022 outlook after another quarter of strong growth

EDENRED

Third-quarter 2022 revenue

Edenred upgrades its full-year 2022 outlook after another quarter of strong growth

Edenred records another quarter of strong growth, reflecting the relevance of its solutions and the strength of its go-to-market: Third-quarter operating revenue of €484 million, up 23.0% as reported (+19.1% like-for-like) versus third-quarter 2021 Double-digit like-for-like revenue growth in all regions and all business lines Driven by strong business volume and higher interest rates in all regions, other revenue more than doubled, from €11 million to €23 million Total revenue of €506 million, up 25.2% as reported (+21.4% like-for-like) For the nine months ended September 30, 2022, the Group’s total revenue stood at €1,428 million, up 22.9% as reported (+19.2% like-for-like) versus the same period in 2021 Edenred’s ESG commitments recognized once again: Edenred was included in the Euronext CAC 40 ESG index on September 19 – recognition of the Group’s commitment to sustainable development Moody’s ESG Solutions increased Edenred’s score by 5 points, raising its status from “Robust” to “Advanced” Edenred is well positioned to benefit from the increasing scale effect of its platform and generate sustainable and profitable growth in 2022 and beyond: Accelerated investments in technology and product innovation to provide corporates, users and merchants with best-in-class experiences and value-added services Powerful go-to-market strategy to further penetrate markets, and in particular tackle the SME segment Continued expansion of the product portfolio with the rollout of Beyond Food, Beyond Fuel and Beyond Payment solutions, fostering cross-selling and unlocking new growth opportunities Buoyant market trends (lasting post-Covid structural changes, increased attractiveness of solutions to support employee purchasing power) and favorable economic conditions (higher interest rates generating additional revenue)   Thanks to its steady growth quarter after quarter, and to the increased attractiveness of its solutions, Edenred is upgrading its 2022 EBITDA outlook to between €810 million and €840 million1 (compared with a target range of between €770 million and €820 million announced on July 26, 2022).   ***   Bertrand Dumazy, Chairman and Chief Executive Officer of Edenred, said: “Edenred’s strong growth momentum continues, quarter after quarter. By enhancing our portfolio of solutions and accelerating our technology investments, we continue to increase the efficiency of our digital platform, providing our clients with best-in-class experiences increasingly tailored to their needs. Our solutions, which are synonymous with higher purchasing power for employees and greater efficiency for fleet managers, are even more relevant in today’s inflationary environment. In these circumstances, our powerful go-to-market enables us to speed up our market penetration, notably in the SME segment. We are confident as the year draws to an end and are upgrading our EBITDA outlook. We will present our strategic plan and prospects for the coming three years next week.”

Turkey is now qualified as a hyperinflationary economy. The Group has therefore applied IAS 29 – Financial Reporting in Hyperinflationary Economies to its operations in this country since January 1, 2022.


THIRD-QUARTER AND NINE-MONTH 2022 TOTAL REVENUE

(in € millions)	Third-quarter 2022	Third-quarter 2021	% change (reported)	% change (like-for-like)
Operating revenue	484	393	+23.0%	+19.1%
Other revenue	23	11	+100.1%	+99.7%
Total revenue	506	405	+25.2%	+21.4%

(in € millions)	First nine months 2022	First nine months 2021	% change (reported)	% change (like-for-like)
Operating revenue	1,375	1,130	+21.7%	+17.9%
Other revenue	53	32	+67.3%	+65.4%
Total revenue	1,428	1,162	+22.9%	+19.2%

• Total revenue

For the third quarter of 2022, total revenue amounted to €506 million, up 25.2% as reported compared with third-quarter 2021. This year-on-year increase includes a favorable currency effect (+3.8%) and a slightly negative scope effect (-0.1%). On a like-for-like basis, total revenue was up 21.4%.

For the first nine months of the year, total revenue came to €1,428 million, up 22.9% as reported and up 19.2% like-for-like compared with the same period in 2021. Reported growth includes a favorable currency effect (+4.0%) and a slightly negative scope effect (-0.3%).

• Operating revenue

Operating revenue increased by 23.0% as reported to €484 million in the third quarter of 2022. The currency effect was a favorable 4.1% and the scope effect was a negative 0.2%. On a like-for-like basis, operating revenue rose by 19.1% year-on-year.

Following on from the results achieved in the first half of the year, Edenred delivered double-digit like-for-like operating revenue growth in the third quarter in each of its business lines and in each of the regions where the Group operates. This solid performance reflects the dynamism of Edenred’s sales teams as well as the Group’s ability to continuously enhance its portfolio and offer its clients innovative and attractive digital solutions.

Operating revenue for the first nine months of 2022 was up by 21.7% as reported and by 17.9% like-for-like compared with the same period in 2021, including a positive currency effect (+4.1%) and a slightly negative scope effect (-0.4%).

• Operating revenue by business line

(in € millions)	Third-quarter 2022	Third-quarter 2021	% change (reported)	% change (like-for-like)
Employee Benefits	275	233	+17.7%	+15.5%
Fleet & Mobility Solutions	143	110	+30.6%	+23.6%
Complementary Solutions	65	50	+31.3%	+26.4%
Total	484	393	+23.0%	+19.1%

(in € millions)	First nine months 2022	First nine months 2021	% change (reported)	% change (like-for-like)
Employee Benefits	802	682	+17.7%	+15.6%
Fleet & Mobility Solutions	395	300	+31.7%	+23.9%
Complementary Solutions	177	148	+19.6%	+16.5%
Total	1,375	1,130	+21.7%	+17.9%

Operating revenue for the Employee Benefits business line, which accounts for 57% of the Group’s total operating revenue, was €275 million in third-quarter 2022, a 17.7% year-on-year increase as reported (+15.5% like-for-like).

This growth is in line with the Group’s first-half performance and confirms the strong sales momentum gained by Ticket Restaurant^® meal benefits, notably among SMEs. It also reflects the progressive impact of clients’ greater use of higher face values to protect their employees’ purchasing power, particularly in countries where the maximum face value by law has been raised. Lastly, Beyond Food solutions, notably designed for companies seeking to enhance their employer brand and boost employee engagement, met with strong commercial success. These solutions are all the more relevant amid today’s structural changes in the workplace and rising inflation.

For the nine months ended September 30, 2022, operating revenue for Employee Benefits came to €802 million, up 17.7% as reported (+15.6% like-for-like) compared with the same period in 2021.

In the Fleet & Mobility Solutions business line, which represents 30% of the Group’s total operating revenue, operating revenue for third-quarter 2022 amounted to €143 million, up 30.6% year-on-year as reported (+23.6% like-for-like).

This strong growth reflects the continued rollout of the Beyond Fuel strategy, notably through the maintenance and toll offering, which is proving highly successful in both Latin America and in Europe. The business also enjoyed strong sales momentum once again, driven by the relevance of its digital, multi-product offering for fleet managers.

For the nine months to September 30, operating revenue for Fleet & Mobility Solutions totaled €395 million, up 31.7% as reported (+23.9% like-for-like) compared with the first nine months of 2021.

The Complementary Solutions business line, which includes Corporate Payment Services, Incentive & Rewards and Public Social Programs, generated operating revenue of €65 million in third-quarter 2022, representing 13% of the Group total. This figure was up 31.3% as reported (+26.4% like-for-like) compared with the third quarter of 2021.

Corporate Payment Services in North America, operated through Edenred CSI, delivered a solid performance, driven by new contract wins, particularly in segments into which the company has recently expanded such as property management and energy, as well as by the ramp-up of its commercial partnerships with several banks and software companies, including Sage. The strong growth in Complementary Solutions also reflects the success of the Group’s innovative programs, such as the fully digital Benefit Xpress offering in Taiwan and the new value-added services accessible via the C3Pay mobile app in the United Arab Emirates (salary advances, for example).

In the first nine months of the year, operating revenue for Complementary Solutions came to €177 million, up 19.6% as reported (+16.5% like-for-like) compared with the same period in 2021.

• Operating revenue by region

(in € millions)	Third-quarter 2022	Third-quarter 2021	% change (reported)	% change (like-for-like)
Europe	283	241	+17.5%	+17.6%
Latin America	161	120	+34.6%	+19.9%
Rest of the World	40	33	+21.1%	+27.7%
Total	484	393	+23.0%	+19.1%

(in € millions)	First nine months 2022	First nine months 2021	% change (reported)	% change (like-for-like)
Europe	834	716	+16.5%	+16.3%
Latin America	432	324	+33.3%	+18.0%
Rest of the World	109	90	+20.7%	+30.0%
Total	1,375	1,130	+21.7%	+17.9%

In Europe, operating revenue amounted to €283 million in the third quarter, a year-on-year increase of 17.5% as reported (+17.6% like-for-like). Europe represented 59% of total consolidated operating revenue in third-quarter 2022.

In the nine months to September 30, 2022, operating revenue in the region totaled €834 million up 16.5% as reported (+16.3% like-for-like) compared with the first nine months of 2021.

In France, operating revenue came to €71 million for the third quarter, up 8.7% both as reported and like-for-like. This growth reflects the success of the Employee Benefits and Fleet & Mobility Solutions businesses, notably in the SME segment, which remains largely underpenetrated. In particular, it is the result of a very good sales performance by the digital Ticket Restaurant^® solution. This performance was also partially offset by the impact of the daily spending cap being lowered back to its pre-Covid level of €19 as from July 1, 2022 (versus €38 since June 12, 2020) and by an unfavorable basis of comparison with third-quarter 2021, when users spent funds they had accumulated while restaurants and certain retailers were shut. Lastly, solutions rolled out under the Beyond Food strategy, including the ProwebCE employee engagement platform and the remote working platform, continued to deliver robust growth, benefiting from continuous, innovation-driven improvements to the user experience.

Operating revenue for France in the first nine months of the year amounted to €220 million, up 10.4% as reported and like-for-like compared with the first nine months of 2021.
Operating revenue in Europe excluding France totaled €212 million in third-quarter 2022, an increase of 20.8% as reported and like-for-like versus the prior-year period. Employee Benefits enjoyed strong momentum across the region. Ticket Restaurant^® meal benefits once again delivered robust growth, boosted by an increase in face values introduced by clients in the current inflationary context, and the Beyond Food strategy continued to be a success. In Fleet & Mobility Solutions, further solid growth in the third quarter was driven by the success of the Beyond Fuel strategy and good sales momentum in the SME segment.

For the first nine months of 2022, operating revenue for Europe excluding France came to €613 million, up 18.8% year-on-year as reported (+18.6% like-for-like).

Operating revenue in Latin America came to €161 million for the third quarter, a rise of 34.6% as reported (+19.9% like-for-like) compared with the third quarter of 2021. Latin America represented 33% of consolidated operating revenue in third-quarter 2022.

For the nine months ended September 30, 2022, operating revenue came to €432 million, up 33.3% as reported (+18.0% like-for-like).

In Brazil, operating revenue rose by 16.2% like-for-like in third-quarter 2022 versus third-quarter 2021. Fleet & Mobility Solutions continued to be driven by the success of the Beyond Fuel offering in maintenance and toll services. Employee Benefits delivered a good sales performance thanks to the continued penetration of the SME segment, supported notably by the growing contribution of the partnership with Itaú Unibanco and the success of the virtual canteen solution.

For the first nine months of the year, operating revenue in Brazil grew by 16.8% like-for-like.

In Hispanic Latin America, third-quarter 2022 operating revenue was up 27.9% like-for-like versus the same period in 2021. This robust performance reflects a sharp acceleration in the Employee Benefits business, as well as further strong growth in Fleet & Mobility Solutions.

For the first nine months of the year, operating revenue in Hispanic Latin America rose by 20.6% like-for-like.

In the Rest of the World, operating revenue came to €40 million for the third quarter, up 21.1% as reported (+27.7% like-for-like). This region represents 8% of consolidated operating revenue in third-quarter 2022.
This performance was notably driven by the success of innovative programs proposed in countries such as the United Arab Emirates and Taiwan. In North America, Edenred CSI’s Corporate Payment Services continued to build on the strong momentum seen in the second quarter, thanks in particular to the ramp-up of its commercial partnerships with several banks and software companies.

For the first nine months of the year, operating revenue in the Rest of the World totaled €109 million, up 20.7% as reported (+30.0% like-for-like) compared with the first nine months of 2021.

• Other revenue 

Other revenue for the third quarter of 2022 totaled €23 million, up 100.1% as reported (+99.7% like-for-like). This significant increase reflects the impact of strong business growth on the float², as well as favorable changes in interest rates in all regions where the Group operates. The gradual acceleration in other revenue growth period after period can be attributed to the steady rise in interest rates observed for several quarters now in Europe (outside the euro zone) and Latin America, as well as to the first effects of interest rate increases in the euro zone. For the nine months ended September 30, 2022, other revenue came to €53 million, representing an increase of 67.3% as reported (+65.4% like-for-like).

OUTLOOK

After achieving record results in the first half, Edenred confirmed its very good business momentum in the third quarter.

Thanks to its segmented sales approach, Edenred continues to penetrate its core markets, with the economic environment further enhancing the attractiveness of its solutions, which notably enable employers to effectively boost their employees’ purchasing power.

Edenred is also unlocking new growth opportunities by expanding its portfolio of solutions to more fully meet clients’ needs. In Employee Benefits, Beyond Food solutions enable companies to enhance their employer brand and boost employee engagement in a fast-changing working world. In Fleet & Mobility Solutions, the Beyond Fuel offering (including maintenance and toll management and VAT refund solutions) helps fleet managers control their expenses. And in Complementary Solutions, the Beyond Payment strategy to enhance the value proposition, as illustrated by the acquisition of IPS, a leading invoice automation vendor, is moving Edenred CSI up the accounts payable value chain.

Lastly, Edenred is accelerating its investments in product and technology innovation to seize opportunities arising from secular trends, such as remote working as a permanent feature in the workplace, green commuting, the consumption of eco-friendly products and the transition of fleets to electric or plug-in hybrid vehicles.

Thanks to its ability to leverage the increasing scale effect of its platform, in an environment where its solutions are increasingly attractive and amid favorable economic conditions, the Group is upgrading its 2022 EBITDA outlook to between €810 million and €840 million³ (compared with a target range of between €770 million and €820 million euros announced on July 26, 2022).

SIGNIFICANT EVENTS IN THE THIRD QUARTER

• Edenred joins the Euronext CAC 40 ESG^® index

On September 19, 2022, the Group joined the Paris stock exchange’s Euronext CAC 40 ESG index, taking its place alongside other companies demonstrating outstanding environmental, social and governance (ESG) practices.

SUBSEQUENT EVENTS

• Edenred expands its Corporate Payment invoice automation capabilities in the US, with the acquisition of IPS
  
  

On October 17, 2022, Edenred announced the acquisition of IPS, a leading invoice automation vendor, through its corporate payment subsidiary Edenred CSI.
This acquisition enhances Edenred CSI’s value proposition by expanding along the procure-to-pay value chain and integrating a turnkey invoice automation solution into its digital platform. By combining suppliers’ invoice processing and payment automation, Edenred CSI clients will have access to an end-to-end integrated solution that further simplifies and streamlines the management of the entire accounts payable process.

UPCOMING EVENTS

October 25, 2022: Capital Markets Day in London
February 21, 2023: Full-year 2022 results
April 20, 2023: First-quarter 2023 revenue
May 11, 2023: General Meeting

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About Edenred

Edenred is a leading digital platform for services and payments and the everyday companion for people at work, connecting 52 million users and more than 2 million partner merchants in 45 countries via 950,000 corporate clients.

Edenred offers specific-purpose payment solutions for food (such as meal benefits), incentives (such as gift cards, employee engagement platforms), mobility (such as multi-energy, maintenance, toll, parking and commuter solutions) and corporate payments (such as virtual cards).

True to the Group’s purpose, “Enrich connections. For good.”, these solutions enhance users’ well-being and purchasing power. They improve companies’ attractiveness and efficiency, and vitalize the employment market and the local economy. They also foster access to healthier food, more environmentally friendly products and softer mobility.

Edenred’s 10,000 employees are committed to making the world of work a connected ecosystem that is safer, more efficient and more responsible every day.

In 2021, thanks to its global technology assets, the Group managed close to €30 billion in business volume, primarily carried out via mobile applications, online platforms and cards.

Edenred is listed on the Euronext Paris stock exchange and included in the following indices: CAC 40 ESG, CAC Next 20, CAC Large 60, Euronext 100, FTSE4Good and MSCI Europe.

The logos and other trademarks mentioned and featured in this press release are registered trademarks of Edenred S.E., its subsidiaries or third parties. They may not be used for commercial purposes without prior written consent from their owners.

 

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CONTACTS

        

Communications Department   Emmanuelle Châtelain +33 (0)1 86 67 24 36 emmanuelle.chatelain@edenred.com   Media Relations   Matthieu Santalucia +33 (0)1 86 67 22 63 matthieu.santalucia@edenred.com

Investor Relations   Cédric Appert +33 (0)1 86 67 24 99 cedric.appert@edenred.com   Baptiste Fournier +33 (0)1 86 67 20 73 baptiste.fournier@edenred.com

APPENDICES

Operating revenue

	Q1		Q2		Q3			Year to date
	2022	2021	2022	2021	2022	2021		2022	2021
(in € millions)
Europe	270	237	281	238	283	241		834	716
France	76	69	74	66	71	65		220	200
Rest of Europe	194	168	207	172	212	176		613	516
Latin America	123	97	148	107	161	120		432	324
Rest of the world	33	29	36	28	40	33		109	90
Total	426	363	465	373	484	393		1,375	1,130
	Q1		Q2		Q3			Year to date
	Change reported	Change L/L	Change reported	Change L/L	Change reported	Change L/L		Change reported	Change L/L
In %
Europe	+13.8%	+13.4%	+18.1%	+18.0%	+17.5%	+17.6%		+16.5%	+16.3%
France	+10.3%	+10.3%	+12.2%	+12.2%	+8.7%	+8.7%		+10.4%	+10.4%
Rest of Europe	+15.3%	+14.8%	+20.3%	+20.2%	+20.8%	+20.8%		+18.8%	+18.6%
Latin America	+26.5%	+16.5%	+38.0%	+17.2%	+34.6%	+19.9%		+33.3%	+18.0%
Rest of the world	+14.3%	+26.0%	+26.9%	+36.7%	+21.1%	+27.7%		+20.7%	+30.0%
Total	+17.3%	+15.3%	+24.5%	+19.2%	+23.0%	+19.1%		+21.7%	+17.9%

Other revenue

	Q1		Q2		Q3			Year to date
(in € millions)	2022	2021	2022	2021	2022	2021		2022	2021
Europe	5	3	6	3	9	3		20	10
France	2	1	1	1	1	1		4	4
Rest of Europe	3	2	5	2	8	2		16	6
Latin America	7	6	10	6	11	6		28	18
Rest of the world	1	1	2	1	2	1		5	4
Total	13	10	18	10	23	11		53	32
	Q1		Q2		Q3			Year to date
	Change reported	Change L/L	Change reported	Change L/L	Change reported	Change L/L		Change reported	Change L/L
In %
Europe	+40.5%	+39.1%	+89.8%	+88.9%	+165.4%	+165.3%		+99.3%	+98.5%
France	+5.6%	+5.6%	-2.0%	-2.0%	+4.0%	+4.0%		+2.5%	+2.5%
Rest of Europe	+66.0%	+63.5%	+159.5%	+158.0%	+281.4%	+281.2%		+170.5%	+169.1%
Latin America	+33.5%	+22.8%	+71.1%	+44.1%	+74.7%	+54.0%		+60.6%	+41.0%
Rest of the world	-18.9%	+35.3%	+10.1%	+78.4%	+60.0%	+149.1%		+18.2%	+89.2%
Total	+28.9%	+29.7%	+69.1%	+63.0%	+100.1%	+99.7%		+67.3%	+65.4%

Total revenue

	Q1		Q2		Q3			Year to date
(in € millions)	2022	2021	2022	2021	2022	2021		2022	2021
Europe	275	240	287	241	292	244		854	726
France	78	70	75	67	72	67		225	204
Rest of Europe	197	170	212	174	220	178		629	522
Latin America	130	103	158	113	172	126		460	342
Rest of the world	34	30	38	30	42	34		114	95
Total	439	373	482	384	506	405		1 428	1 162
	Q1		Q2		Q3			Year to date
	Change reported	Change L/L	Change reported	Change L/L	Change reported	Change L/L		Change reported	Change L/L
In %
Europe	+14.2%	+13.8%	+19.1%	+19.0%	+19.6%	+19.6%		+17.6%	+17.5%
France	+10.2%	+10.2%	+11.9%	+11.9%	+8.6%	+8.6%		+10.2%	+10.2%
Rest of Europe	+15.9%	+15.3%	+21.9%	+21.7%	+23.7%	+23.8%		+20.5%	+20.3%
Latin America	+26.9%	+16.8%	+39.6%	+18.6%	+36.7%	+21.7%		+34.7%	+19.2%
Rest of the world	+12.9%	+26.5%	+26.1%	+38.6%	+22.8%	+32.9%		+20.6%	+32.6%
Total	+17.6%	+15.7%	+25.7%	+20.4%	+25.2%	+21.4%		+22.9%	+19.2%

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¹ Calculated based on an assumption of an average euro/Brazilian real exchange rate for the fourth quarter of 2022 equal to the closing spot rate on September 30, 2022.
² The float corresponds to a portion of the operating working capital from the preloading of funds by corporate clients.
³ Calculated based on an assumption of an average euro/Brazilian real exchange rate for the fourth quarter of 2022 equal to the closing spot rate on September 30, 2022.

 

Attachment

• 2022 10 20 - Edenred - PR - Q3 2022 revenue