GlobeNewswire Inc | Oct 29, 2020 01:45AM EDT

October 29, 2020

Press Release

Paris, 29th October 2020

Third quarter 2020

Q320 strongly supports 2020 guidance

Mid to high single digit full year organic decline confirmed All 2020 objectives reiterated

Revenue of 646million, down 9% on a comparable basis1Retail growth down 5% in Q320, better than expectedActivity in SMB, Enterprise and Payone stabilized while Global Online is still impacted by the Travel vertical

B&A performance in the trajectory of a gradual recovery with a 14% organic decline in Q320

Fit for Growth and Covid-19 action plan on-track to deliver 135 million impact in 2020,

All 2020 objectives reiteratedMid to high single digit organic decline in revenues for FY20FY20 EBITDA in percentage of net revenue above 21%Free Cash Flow conversion rate above 50%

Ingenico Group (Euronext: FR0000125346 - ING), the global leader in seamless payments, today announced its revenue for the third quarter 2020.

Michel-Alain Proch, Chief Financial Officer of Ingenico Group, commented: In the context of the Covid-19 crisis, the Group posted a solid performance in the third quarter, achieving 9% organic decline with a better than expected performance of Retail while B&A came fully in line with our expectations. The latest evolution of the health situation leads us to be cautious regarding the recovery curve of the fourth quarter which will be smoother than expected. Considering the dynamics of the last two quarters of the year, we confirm our scenario, a mid to high single digit organic decline in revenues for 2020.

During the first nine months, we have successfully pursued the execution of our Covid-19 action plan on top of the Fit for Growth plan and we confirm our objective to deliver a combined 135 million EBITDA savings impact in 2020. I would like to thank our teams for their proactive mobilization during this period and their full commitment to deliver quarter after quarter a very solid EBITDA performance despite the health situation. Finally, the combination with Worldline is now completed and integration is fully on track to create the undisputed European champion in payments.

Key figures

9-months 2020 Q3 2020 ?m % Change ?m % Change Comparable^1 Reported Comparable^1 ReportedRetail 980 -4% -7% 348 -5% -7%SMBs 174 -3% -4% 60 -6% -6%Global Online 252 -7% -8% 84 -14% -15%Enterprise 268 -3% -10% 98 4% -3%Payone 286 -5% -5% 107 -5% -5%B&A 908 -12% -16% 297 -14% -22%EMEA 323 -9% -9% 111 -4% -4%Latin America 142 -17% -41% 53 -13% -45%North America 176 22% 36% 54 -8% -4%Asia-Pacific 266 -26% -26% 79 -27% -29%TOTAL 1,888 -8% -12% 646 -9% -14%

Third quarter 2020 performance

In the third quarter of 2020, net revenue totalled 646million, representing a 9% decrease on a comparable basis. On a reported basis net revenue was 14% lower than in the third quarter of 2019 and included a negative foreign exchange impact of 34 million and the effect of Healthcare France disposal.

Over the quarter, the Retail Business Unit reported a net revenue of 348million, showing a decrease of 5% on a comparable basis. On a reported basis, net revenue decreased by 7% during the quarter and included a negative foreign exchange impact of 6 million and the effect of Healthcare France disposal. Compared with Q319, the various activities performed as follows on a like-for-like basis:

-- SMB (down 6%): The third quarter performance was slightly above our expectations with a positive performance on the non-travel verticals. SMB continued to deliver a steady onboarding rate of merchants on its platform with c.1,000 net new customers per month (c.4,000 gross new customers), thanks to an ongoing decrease of the churn rate during the period and a strong dynamic on online merchants. During the third quarter, the all-in one instore offering, Bambora connect, tailored for ISVs, is continuing to gain traction with a significant ramp-up of one of the contracts signed in H120 and good growth prospects expected for the fourth quarter of 2020. -- Global Online (down 14%): The third quarter performance came in line with our expectations driven by a good dynamic in the non-Travel verticals such as marketplaces, gaming and digital goods continuing to grow double-digit, but not able to fully compensate the Travel impact. The latter vertical remains impacted by the fall of international travel traffic, as expected, despite some domestic and intra-regional travel recovery, and less refunds flows accounted than in Q220. On the regional side, APAC continued showing good momentum again growing double digit. During the period, Global Online pursued its geographical and acceptance network expansion with new client wins during the quarter and expanded relationships with existing clients such as Shein, Zendesk or Mindbody.

-- Enterprise (up 4%): Performance came slightly better than expected during the third quarter despite the high comparison basis in Q319 driven by Healthcare Germany activities. Excluding this specific effect, Enterprise was up 9% on an organic basis. The division is benefiting from a strong traction on both sale of POS and transaction activities. In the latter, the transaction business continued its double-digit growth, driven by the European omnichannel instore platform (Axis), in which processed volumes recovered during the third quarter after a Q220 strongly impacted by the lockdowns in Europe. POS activities enjoyed a good dynamic. North America has been a strong driver this quarter, with an activity back to normative levels. -- Payone (down 5%): The third quarter performance came in line, with transaction activities fuelled by an acceleration of the shift towards electronic payments, in the trajectory of Q220. Usage of card payment in the German market continued to strongly increase, thanks to the improvement of payment threshold leading to a higher usage of contactless payments that represent today c.60% of electronic payments vs c.50% pre-Covid. The conversion of saving banks customers to Payone payment solution remained steady during the quarter, driven by the one-stop shop offering and digital onboarding capabilities, with more than 1,000 net new merchants joining the platform every month. The DACH region shift acceleration towards electronic payments will benefit to Payone performance in the coming quarters.

The B&A Business Unit posted a net revenue of 297million, a 14% decrease on a comparable basis. On a reported basis, the activity decreased by 22% and included a negative foreign exchange impact of 28million. Compared to Q319, the various regions performed as follows on a like-for-like basis:

-- Europe, Middle-East & Africa (down 4%): The third quarter performance came in solid and slightly above our expectations with a steady improvement of the dynamic quarter to quarter. In Q320, France was back to growth, while countries such as DACH and Iberia have shown a good dynamic, fuelled by Terminal as a Service contract signed in H120 and the first deliveries of Android POS for the latest. In the meantime, the UK and Italy remained impacted in the current environment. As expected, Eastern Europe, after being back to growth in H120, has pursued on the same trajectory, while Russia has continued to suffer from a high comparison basis and a low pipeline of projects. The trajectory of the region should remain solid in the coming quarters with an improvement of the overall performance. -- Asia-Pacific(down 27%): The dynamic in the region came in below our expectations during the quarter. China has been still impacted by a very low pipeline due to the lack of projects initiated in H120. The situation should continue in the coming quarters. In parallel, India has been strongly impacted by the ongoing lockdowns that are still implemented in the country. As during H120, South East Asia came in softer on the back of Indonesia suffering from a high comparison basis. In the meantime, the Pacific region has shown a good dynamic, benefitting from the ongoing impact of commercial successes and pipeline of projects that would continue to deliver good growth basis in Q420. -- Latin America (down 13%): The dynamic in the region came in slightly better than our expectations with Brazilian market still impacted by the Covid-19 spread during the quarter, combined with high comparison basis. This situation should continue to weight in the coming quarters. In other countries, such as Columbia, Argentina and Peru, the momentum keeps ongoing on the same trajectory as H120, fuelled by the contracts signed and the pipeline of projects. -- North America (down 8%): The third quarter performance came in line with a level of activity stabilizing sequentially after four quarters of strong growth. On the regional side, Canada is back to a normative level of activity during the last quarter. US-based activity remained strong benefitting from the early implementation of our ISV vertical initiative showing a continuous strong dynamic fuelled by project delivery and development of partner programs. In the meantime, the first Terminal as a Service contract has been signed during the Q320. The ongoing demand on back of the EMV cycle renewals remains robust and some consolidation of market shares has been achieved. Overall, the pipe should sustain sequentially the level of activity in the coming quarters.

All 2020 objectives confirmed

-- Net revenue: a mid to high single digit organic decline -- EBITDA: an EBITDA margin above 21% (20.9% in FY19) -- Free cash-flow conversion: a FCF conversion above 50%

The 2020 objectives communicated in April have been built on the three following scenarios structured around different recovery curves:

-- Scenario 1: return to the pre-Covid-19 guidance of 4% to 6% organic growth in Q420 leading to a mid-single digit organic decline in FY20; -- Scenario 2: return to the pre-Covid-19 guidance of 4% to 6% organic growth in December 2020 leading to a mid to high single digit organic decline in FY20; -- Scenario 3: return to the pre-Covid-19 guidance of 4% to 6% organic growth in Q121 leading to a high single digit organic decline in FY20.

After nine months of activity, the Groups business assumptions remain unchanged, i.e. a progressive pick-up in consumption while stores re-open depending on health constraints, a central scenario on travel with no recovery of international travel before 2021 and a gradual pick-up on regional travel, and some possible short and local re-confinements in the countries in which the Group operates.

Based on the recent performance with a third quarter better than expected driven by a post-confinement pick-up in activity, Ingenico anticipates for the fourth quarter a gradual recovery curve.

Despite this phasing, the overall groups performance for the full year should remain in the mid to high single digit organic decline, confirming the expected growth scenario.

Based on this scenario, Ingenico Group confirms its strong and holistic action plan activated early March, aiming at adapting its cost structure, protecting profitability and preserving cash. Consequently, on top of the Fit for Growth plan that will deliver 35 million EBITDA impact in 2020, this C19 action plan implemented during Q120 will deliver 100 million added EBITDA impact in 2020.

Ingenico Groups long-term growth drivers remain intact and we are convinced that the Group should come out of the current crisis even stronger with the engagement of all of the teams serving our clients for the benefit of all of our stakeholders.

Audio Webcast & Conference Call

The third quarter 2020 revenue will be discussed in an audio webcast and a Group telephone conference call to be held on 29th October 2020 at 7.15am Paris time (6.15am UK time). The presentation and audio webcast will be accessible at www.ingenico.com/finance. The call will be accessible by dialling one of the following numbers: +33(0)170377166 (from France), +12129996659 (from the US) and +442030032666 (from other countries) with the conference password:Ingenico.

This press release contains forward-looking statements. The trends and objectives given in this release are based on data, assumptions and estimates considered reasonable by Ingenico Group. These data, assumptions and estimates may change or be amended as a result of uncertainties connected in particular to the performance of Ingenico Group and its subsidiaries. These forward-looking statements in no case constitute a guarantee of future performance, and involve risks and uncertainties. Actual performance may differ materially from that expressed or suggested in the forward-looking statements. Ingenico Group therefore makes no firm commitment on the realization of the growth objectives shown in this release. Ingenico Group and its subsidiaries, as well as their executives, representatives, employees and respective advisors, undertake no obligation to update or revise any forward-looking statements contained in this release, whether as a result of new information, future developments or otherwise. This release shall not constitute an offer to sell or the solicitation of an offer to buy or subscribe for securities or financial instruments.

About Ingenico Group

Ingenico Group (Euronext: FR0000125346 ING) is shaping the future of payments for sustainable and inclusive growth. As a global leader in seamless payments, we provide merchants with smart, trusted and secure solutions to empower commerce across all channels and enable simplification of payments and deliver customer promises. We are the trusted and proactive world-class partner for financial institutions and retailers, from small merchants to the worlds best-known global brands. We have a global footprint with more than 8,000 employees, 90 nationalities and a commercial presence in 170 countries. Our international community of payment experts anticipates the evolutions of commerce and consumer lifestyles to provide our clients with leading-edge complete solutions wherever they are needed.www.ingenico.com@ingenico

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Contacts / Ingenico Group

InvestorsLaurent Marie - VP Investor Relations & Financial Communication(T): +33 (0)1 58 01 83 24laurent.marie@ingenico.com

MediaHlne Carlander - PR Officer(T): +33 (0)7 72 25 96 04helene.carlander@ingenico.com

EXHIBIT 1GROSS AND NET REVENUE

Following the achievement of the Group operating model redesign, the reporting has been adjusted as follow:

-- Restatement of Healthcare France contribution after the disposal of the entity end 2019 -- Mexico is now allocated in North America versus Latin America previously following a change in management responsibility

In parallel, as announced and to provide a greater transparency and to make it easier to read the performance, revenue are now reported on a net basis (excluding interchange fees).

1. FORMER REPORTING ON REPORTED BASIS (GROSS REVENUE) In Millions of euros Q1 2019 Q2 2019 Q3 2019 Q4 2019 2019Retail 435 471 501 512 1,919SMBs 79 85 90 89 343Global Online 133 141 152 155 582Enterprise 91 104 101 116 412Payone 131 142 158 152 582Banks & Acquirers 318 387 379 367 1,451EMEA 110 130 116 118 473Latin America 65 78 96 85 325North America 31 42 56 60 189APAC 112 136 111 104 463TOTAL 753 858 880 879 3,370 2. NEW REPORTING ON A PRO FORMA BASIS (GROSS REVENUE) In Millions of euros Q1 2019 PF Q2 2019 PF Q3 2019 PF Q4 2019 PF 2019 PFRetail 430 464 500 512 1,906SMBs 79 85 90 89 343Global Online 133 141 152 155 582Enterprise 87 96 99 116 399Payone 131 142 158 152 582Banks & Acquirers 319 389 376 365 1,449EMEA 111 132 117 119 479Latin America 57 72 83 81 293North America 37 46 62 57 201APAC 115 140 114 108 477TOTAL 749 853 875 878 3,355

3. FORMER REPORTING ON REPORTED BASIS (NET REVENUE) In Millions of euros Q1 2019 Q2 2019 Q3 2019 Q4 2019 2019Retail 324 351 376 394 1,444SMBs 57 60 64 66 246Global Online 85 90 99 101 374Enterprise 91 104 101 116 412Payone 91 98 112 111 412Banks & Acquirers 318 387 379 367 1,451EMEA 110 130 116 118 473Latin America 65 78 96 85 325North America 31 42 56 60 189APAC 112 136 111 104 463TOTAL 642 738 755 761 2,895 4. NEW REPORTING ON A PRO FORMA BASIS (NET REVENUE) In Millions of euros Q1 2019 PF Q2 2019 PF Q3 2019 PF Q4 2019 PF 2019 PFRetail 319 344 374 394 1,431SMBs 57 60 64 66 246Global Online 85 90 99 101 375Enterprise 87 96 99 116 399Payone 91 98 112 111 412Banks & Acquirers 319 389 376 365 1,449EMEA 111 132 117 119 479Latin America 57 72 83 81 293North America 37 46 62 57 201APAC 115 140 114 108 477TOTAL 638 733 750 760 2,881

1 On a like-for-like basis and at constant rate on net revenues



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