Earthport PLC Business and Trading Update (6341Y)

TIDMEPO

RNS Number : 6341Y

Earthport PLC

26 February 2013

Earthport plc

("Earthport" or the "Company)

Business and Trading Update

Earthport (AIM: EPO.L), the cross-border payments services provider, is pleased to announce an update on trading for the six months ended 31 December 2012.

Highlights

-- Revenue grew by approximately 32% to over GBP1.80m compared to the period ended 31 December 2011

   --      Transaction volumes increased 72% compared to the period ended 31 December 2011 
   --      9 new customers were signed in the period and 8 customer implementations went live

-- Major global financial institutions contracted to use the Earthport service, including Bank of America N.A. and BB&T

-- Country network expanded to a total of 55 countries, with several more in progress and existing network strengthened

Overview

Strong progress was achieved during the first half of the financial year with several major customer signings and go lives. In addition, network coverage expanded and transaction volumes increased throughout the period. Transaction volumes grew by approximately 72% compared to the prior period. Costs were in-line and have stabilised. Base costs have held steady in the period, reflecting three half year periods of steady costs, and are not expected to increase other than related to specific revenue producing activities such as professional services.

Customer and Partner Activity

During the period, three large banks contracted for the Earthport service. These include Bank of America N.A. which contracted with Earthport to expand its low-value, cross-border service capability and BB&T Corporation, which will use the Earthport service for retail person to person payments, providing a transparent service in line with the requirements under Dodd Frank 1073 regulation.

Changing regulation, particularly in North America has driven increased traction in the sales pipeline, resulting in the agreement with BB&T and two significant ($100,000+) consulting engagements, one with an existing customer and one with a new customer. We expect both engagements to lead to full implementations in due course. Two further consulting agreements, unrelated to Dodd Frank, have also been signed with a major international bank and one of our channel partners.

The business focused significant effort on supporting the previously announced partner relationships. Since the start of the financial year, these partners have contracted with three clients, two of which are large banks and one is an Asian remittance business. This is our second Asia based customer following the signing of the Company's first Asian client earlier in the period.

While some of the activities above generated integration and professional services revenues in the first half of the year, minimal transactional revenue from the above mentioned clients is included in the revenues to 31 December 2012. Several of these relationships are expected to generate transactional revenues in the second half as services are launched and go-live.

With some of the world's largest financial services brands now trusting Earthport, the business has seen heightened interest in all forms of cross border activity. In light of a business focus to serve the banking community, the Company has strived to improve the quality of customers and transactions. As a result of a business review, Earthport has taken the step of dis-continuing transacting relationships with three revenue generating clients who do not align to the Company's stated strategic direction.

From the traction to date, it is clear that Earthport's low-value, cross-border payments service is being adopted as a mainstream function of the banking industry. We expect to have increasing momentum in this space. Transaction volumes follow four to eight months after contracting with a client, with larger clients taking longer than smaller ones to adopt the service. Minimum transaction commitments and professional services revenues are now providing a significant revenue contribution during the integration and adoption phase.

Hank Uberoi, Executive Director, Earthport plc,

"Earthport is now providing cross-border payment services to some of the world's largest financial services companies. We are very pleased with the clients we have signed up so far and are confident of capitalising on the tremendous opportunities that we are seeing. There is real potential for Earthport to become a core part of the global low value payment infrastructure together with our Banking partners and Clients."

Notice of Results

The Company expects to announce the results for the period ended 31 December 2012, on Thursday 28 March 2013.

For further information, please contact:

 
 Earthport plc 
  Hank Uberoi / Paul Thomas/Chris Cowlard      020 7220 9700 
 Panmure Gordon 
  Fred Walsh / Victoria Boxall                 020 7886 2500 
 Charles Stanley Securities 
  Mark Taylor / Paul Brotherhood               020 7149 6000 
 Newgate Threadneedle 
  Caroline Evans-Jones/ Josh Royston/ Fiona 
  Conroy                                       020 7653 9850

About Earthport

Earthport plc, a regulated global financial services organisation, specialises in the provision of a white label cross-border payments service.

Through its innovative payments framework, specifically designed for high volumes of low value cross-border payments, Earthport provides a cost-effective and transparent service for secure international payments. Earthport's customers include banks, foreign exchange businesses, money transfer organisations, payment aggregators and e-commerce businesses. Through Earthport's well established payments infrastructure, customers can clear and settle payments directly to banked beneficiaries in over 50 countries.

The company is headquartered in London and is listed on the Alternative Investment Market (AIM) on the London Stock Exchange. It operates globally with additional regional offices in Dubai and New York. Earthport plc is authorised and regulated by the Financial Services Authority under the Payment Service Regulations 2009 for the provision of payment services. To learn more, please visit www.earthport.com and follow us on Twitter @Earthport

This information is provided by RNS

The company news service from the London Stock Exchange

END

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