Equals Group PLC COVID-19 Update (2641K)
April 21 2020 - 2:00AM
UK Regulatory
TIDMEQLS
RNS Number : 2641K
Equals Group PLC
21 April 2020
For immediate release 21 April 2020
Equals Group plc
('Equals' or the 'Group)
COVID-19 Update
Equals (AIM:EQLS) , the fast-growing B2B focused e-banking and
international payments group, provides the following update
regarding the steps taken by the Group to ensure continuity of
service whilst protecting its employees.
Actions taken and contingency plans for COVID-19
As stated previously on 17 March 2020, all Equals staff are
working from home and the transition has been proving successful
both for business-as-usual and for the ongoing development of new
products and revenue streams.
To combat the likely revenue impacts during the global pandemic,
the Group has reduced its cost base selectively depending on
product lines and levels of demand during the pandemic. The Group
has also welcomed and is accessing available government support
measures, including the UK Government's Coronavirus Job Retention
Scheme for approximately 20% of employees. The Group has also
implemented measures to reduce 20% of the pay of its employees who
have not been furloughed, including the Board and executive
management team, as a temporary cash conservation measure. Finally,
the success of home-working is also enabling the Board to review
the Group's office space requirements, especially in London.
Furthermore, the Group has taken decisive actions to be in a
position to react swiftly to any changes in the situation,
including both an extension of the lockdown and, however unlikely,
a more rapid return to normal trading than is currently
anticipated. Underpinning this readiness are multiple scenario
models and key trigger points for action. Through this planning,
combined with a strong balance sheet, the Group is confident of its
ability to emerge from the crisis in a strong position.
Q1-2020 trading
Group revenues to 31 March 2020 were 32% higher than the same
period last year at GBP8.3 million. In terms of revenue split, B2B
accounted for 67%, up from 46% in Q1-2019 and 52% for FY-2019.
The robust Q1-2020 performance was built upon strong growth in
International Payments (up by 116%) and also Corporate Banking (up
by 30%), however, this was offset by declines due to the pandemic
in March 2020 in Travel Money* (down by 30%) and Corporate Expense
platform usage (down by 11%).
International Payments were supported by volatile currency
markets which saw corporate customers transacting to hedge
positions. B2B banking saw increased new account openings as more
companies sought to move to online trading. Further growth in B2B
banking is expected from continuous user experience upgrades to the
platform combined with additional functionality coming on stream in
late April 2020.
The global pandemic has also impacted reporting timetables for
numerous public companies as auditors need longer to finalise their
processes due to remote working and revised guidance issued from
the Financial Reporting Council. The Group is in constant dialogue
with its auditors, PWC, and currently expects to publish its final
results for the year ended 31 December 2019 in late May 2020 and
hold the Group's AGM in late June 2020. However, both dates are
subject to change and will be confirmed in due course.
Outlook
The outlook for Q2-2020 is largely dictated by the length and
severity of the lockdown here in the UK and impact on the global
economy. The effects of COVID-19 in Q1-2020 varied by product with
a more pronounced effect on Travel Money than International
Payments and corporate platform usage. For Q2-2020, the early
indications are within the Group's median expectations on its
scenario modelling, reinforcing the relatively strong position of
the business to withstand the pandemic and to emerge in a strong
position when the situation abates.
Ian Strafford-Taylor, CEO of Equals Group, said:
"We are pleased with the resilience that business has
demonstrated in Q1-2020 which reflects the underlying growth of the
business in 'normal' conditions and validates our strategy over the
last two years of transforming the business to one that focuses
largely on B2B. We have also taken decisive and prudent steps to
protect the Group including cost reduction measures and this
combined with the continued dedication of our staff, provides us
with increased confidence that we will emerge from this pandemic in
a strong position."
- Ends -
For more information, please contact:
Equals Group plc
Ian Strafford-Taylor, CEO Tel: +44 (0) 20 7778
Richard Cooper, CFO 9308
www.equals.co
Cenkos Securities plc (Nominated Advisor
/ Joint Broker)
Max Hartley / Callum Davidson Tel: +44 (0) 20 7397
Nick Searle (Sales) 8900
Canaccord Genuity (Joint Broker)
Bobbie Hilliam / David Tyrell Tel: +44 (0) 20 7523
Alex Aylen (Sales) 8150
Buchanan (Financial Communications)
Henry Harrison-Topham / Steph Watson Tel: +44 (0) 20 7466
/ Toto Berger 5000
equals@buchanan.uk.com www.buchanan.uk.com
Notes to Editors:
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. The Group enables its
personal and business customers to make easy, low-cost payments
both domestically and in a broad range of currencies across a range
of products all via one integrated system.
Equals provides money movement services to both business and
personal customers through five inter-connected channels -
International Payments, Corporate Expenses platform, Bank Accounts,
Travel Money (*comprising currency cards and physical currency).
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 which yields significant
cost savings via tighter control on expenses before they are
incurred coupled with eliminating inefficient processes. Equals
also offers business and retail bank accounts with all the
functionality offered by banks, namely faster payments, BACs,
direct debits, international payments and a debit card. The Travel
Money offerings (retail currency card and physical currency)
represent cost-effective and secure methods for travelers to spend
abroad.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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