Earnings call transcript: Worldline Q3 2025 revenue stable amid challenges

Worldline SA reported its Q3 2025 earnings on October 21, showing external revenue of €1,150 million and a slight organic revenue decline of 0.8%. Despite the challenging macroeconomic environment in Europe, the company’s stock saw a modest increase of 1.35%, closing at €2.44. According to InvestingPro data, the stock is currently trading significantly below its 52-week high of €10.54, with a price-to-book ratio of just 0.17, suggesting potential undervaluation. The company maintains a "Fair" overall financial health score of 1.88 out of 5. The earnings call revealed a flat performance in merchant services and a decline in financial services revenue, prompting a cautious outlook for the next quarter.

Key Takeaways

• Worldline’s Q3 2025 revenue reached €1,150 million, with a 0.8% decline organically.
• Merchant services revenue remained stable year-on-year at €862 million.
• Financial services revenue decreased by 4.5%.
• The company expects Q4 performance to mirror Q3 results.
• Stock price increased by 1.35% following the earnings report.

Company Performance

Worldline’s performance in Q3 2025 was characterized by stability in its merchant services segment, which remained flat compared to the previous year. However, the financial services segment faced a 4.5% decline, reflecting broader challenges in the sector. The company continues to navigate a soft European macro environment and a challenging consumer context, with some positive performance in travel and hospitality verticals.

Financial Highlights

• External Revenue: €1,150 million (down 0.8% organically)
• Merchant Services Revenue: €862 million (flat year-on-year)
• Financial Services Revenue: Down 4.5%
• Adjusted EBITDA Guidance: €830-855 million
• Free Cash Flow Guidance: -€30 million to €0

Outlook & Guidance

Worldline anticipates Q4 2025 performance to be similar to Q3, with potential investments in compliance and risk management. The company is focused on optimizing its merchant portfolio and expects continued stabilization in its merchant acquiring business, particularly in Italy and the Nordics.

Executive Commentary

CEO Pierre Antoine Vacheron expressed confidence in the company’s direction, stating, "Q3 has again been super active as this management is acting with a true sense of urgency to put the company back on track." He also highlighted the potential for growth in the financial services segment, despite current challenges.

Risks and Challenges

• Soft European macro environment could continue to impact revenue.
• Ongoing investigations in Belgium and Sweden may pose regulatory risks.
• Challenges in Germany’s partner channel could affect future growth.
• Market saturation in certain segments may limit expansion.
• Economic uncertainties could impact consumer spending and business investment.

Q&A

During the earnings call, analysts inquired about the impact of a recent S&P credit rating downgrade, which the company stated would not have a material impact. There were also questions regarding ongoing investigations and the company’s cash pooling mechanism, which were addressed in detail by the management.

Worldline remains focused on navigating the current economic landscape while seeking opportunities for growth in its financial services segment. The upcoming Capital Markets Day on November 6th is expected to provide further insights into the company’s strategic direction.

Full transcript - Worldline SA (WLN) Q3 2025:

Conference Operator: Evening, and thank you for standing by. Welcome to the Worldline Q3 twenty twenty five Revenue Conference Call. Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Pierre Antoine Vacheron, Worldline Group CEO. Please go ahead.

Pierre Antoine Vacheron, Group CEO, Worldline: Thank you. Thank you, operator, and thanks a lot to all of you for joining our Q3 revenue call. Before we begin the presentation, let me welcome Srikant Seshadi, who joined as our new CFO last month and who is here with me today. Some of you may have spoken to already and you’ll have the opportunity to meet him obviously at our Capital Market Day on the November 6. I must say, I’m super happy to have Frigand on board with me.

He come with extensive experience at Alstom, and I can tell you that he already has a big impact on the organization. So maybe to start with the key highlights, I will not comment the whole slide, but what you can see on this slide is that Q3 has again been super active as this management is acting with a true sense of urgency to put the company back on track. Our Q3 revenue performance is in line with expectations with the good news of stabilization of revenue at Merchant Services versus last year Q3 and the slowdown of the decline on Financial Services. These results that Srikant will comment more, combined with the underlying trends that we see, allow us to confirm the guidance of July in a narrower brand between €830,000,000 and €855,000,000 of adjusted EBITDA and the free cash flow, including the increase of financial cost, that would be between minus 30,000,000 and 0 plus, depending on the EBITDA. This performance of Q3 is linked to the positive impact of the measures that we have taken since April.

As you remember, one of our key challenges was the unavailability of next gen Android based terminals. This topic is the most behind us, which enable the management, together with the improvement of customer satisfaction, to stabilize the churn in several geographies. Same with the ramp up of our soft POS, which proves to be super competitive in the various segments and verticals where we deploy it. It’s not big volumes, but it shows that our line is well positioned in emerging customer journey. The successful launch of Wipro with the first pilot in Germany, the fast ramp up of GOPE e commerce offering in the Crediag recall branches, the commitment of several enterprise merchants to migrate to GOPE are other testimonies of our line in motion.

And I could give other examples of this, notably in Financial Services, with the successful deployment of cards from our next generation issuing platform within the portfolio of a large Dutch bank. During Q3, we finalized the review of our merchant portfolio and the assessment of our risk framework. What is super important for you to get is that we confirm today based on the results on the analysis done by Accuracy that the group’s merchant acquiring and collecting portfolio is generally mature and that no material off boarding is expected beyond the merchants that were already off boarded since 2023. We are also continuing to review the technical orchestration layer that could lead to some decommissioning of some merchants, but the impact in 2025 would be marginal. On this side, Oliver Wyman concluded on the assessment of our compliance and risk framework.

Their evaluation confirms that wireline has made significant progress in enhancing its risk and compliance framework in the recent years. The AML framework and governance according to them are well defined according to benchmarks, but we need to improve the harmonization of their implementations across entities, which we knew. This is what we are committed to do through industrialization and automation across our global competence centers. As you know, our transformation roadmap includes the divestments of assets, which we consider as non core. To today, we announced our entry into exclusive negotiations regarding the divestment of Wireline North American activities for an enterprise value of EUR $1,770,000,000.

Worldwide North America provides online and in person payment services to SMBs across Canada and The United States in a range of specialized verticals, and its perimeter represents a turnover of €60,000,000 in 2024 and €8,000,000 of adjusted EBITDA. This contemplated transaction is a significant milestone after METS in our journey to simplify the scope of this company. It is expected to close in the 2026, subject to usual customary approvals. Regarding METS that we announced last July, the process is progressing as expected. The signing of the share purchase agreement is expected in the coming weeks, while the closing of the transactions should happen in H1 twenty twenty six.

Ahead of this and in anticipation of the disposal of METS, we have decided to move to the next phase of simplification and streamlining of the organization. As you know, we renewed the leadership team in the last month to have greater diversity and increase the range of competencies. In the past few months, we have welcomed Candace Dion to Head of Technology and Operations, Frick Hunt has joined as new Group CFO, Anika Grant as Group Head of HR and Madelena Cascais as new Head of Financial Services. To make it simple, as Merchant Services will represent something like 80% of the revenue of the company, we are going to drive our Merchant Services business directly at the ex co level, tailoring the organization. I will take myself direct ownership of the go to market, while Candace will take ownership of the operations.

This new setup will help maximize synergies between FS and MS and have a direct grip on the transformation journey ahead that I’m looking forward to share with you at the CMD on November 6. I would like now to hand over to Frigant, who will enter in detail in the performance of the Q3 in our various business lines.

Srikant Seshadi, Group CFO, Worldline: Thank you, Pierre Antoine, and good evening, everyone. I’m very happy to join you for my first results call at World Life. I’m aware of the challenges we are facing and I’ve been working with the refresh management team across the organization and we’re all quite motivated, highly motivated I would say to deliver the turnaround plan to restore growth and cash generation potential. Now looking at Q3 twenty twenty five, Worldline delivered external revenue of EUR 1,150,000,000.00 in line with expectation, representing an organic decline of 0.8% with Merchant Services decreasing 0.1% or down 3.5% on a net net revenue basis. The lag in NNR versus published revenue was mainly due to merchant and product mix.

Financial Services was down 4.5% with a decline versus H1 moderating after the end of client and sourcing in account payment division. And finally, Meds revenue was up 0.6%. Turning on the next page to the detailed segment analysis. In Merchant Services, we delivered Q3 revenue of EUR $862,000,000 broadly flat year on year in organic terms, but underlying was slightly higher year on year when excluding the hardware base effect. Looking at the trends by go to market in large enterprise, the segment was impacted by lower performance on terminals as Pierre Antoine was alluding to earlier, as well as lower volumes in the retail vertical.

On the positive front, our acquiring business has stabilized with good performance in Italy and in The Nordics. Our travel and hospitality franchise continued its momentum, thanks to new client wins and growth of our business with existing clients. As illustrated by the logos on the side, our offering for airlines continue to expand. We notably signed a partnership with Yipei in China, where Yipei will be integrated into our dedicated travel hub platform and are acquiring capabilities. We also signed a couple of new customers in the hotel space and expanded our offering with Arabian Oud in retail and the Avis Budget Group.

Then in the small and mid mid business, small and medium sized business, while our performance was affected by the lack of availability of next gen terminals in certain markets, this issue has been materially fixed and our solutions are being rolled out. The stabilization of our churn has thus been confirmed during the summer. Our growth dynamic in Central Europe remains robust and broad based across all verticals. Last, in our joint ventures, we continue to see solid market share gains in Italy, thanks to progressive migration of Credem and CCB merchants. On the other hand, Germany performance was more difficult in Acceptance and in Terminals.

Although situation has improved in SMB main channels, I. E. Direct and Savings Bank, the partner channel is still suffering. Now looking at the FX Q3 revenue developments. Card based payments processing revenue was broadly stable.

We benefited from new contracts as well as upselling and volume increases on existing customers. These positive developments were partly offset by the descoping of certain activities of acquiring in Benedict and in Italy. Digital Banking revenue was impacted mainly by lower SMS activity in France and to a lesser extent, ideal volumes in Netherlands. Finally, account payment activities were held back mainly by a decline in transformation projects. Account payment was the main reason behind the drop of the segment’s revenue decline as the other two segments were broadly stable to slightly negative.

In terms of commercial dynamic in Q3, Worldline won a contract with Guaranty Bank to plug in merchants for e commerce acquiring services, as well as contracts with large banks in Italy and Netherlands for verification of pay, bureau processing and client migration for the target issuing platform. On Mobility and eTransaction Services, segment delivered positive organic growth in Q3. Transport and Mobility sub segment benefited from higher volumes in The UK rail sector and from higher activity in mobility projects and ticketing systems in France. In omni channel interactions, we saw good growth in LCL in France, but faced a high comparison in license deals from the prior year. Finally, we had lower revenue in trusted services as a result of certain contracts coming to an end and lower volumes for our connected vehicle solution in France.

In Q3, Worldline was selected by the French services and payment agency for the management, coordination and functional design of agricultural aid solutions in France. The business unit also renewed its contract with the rail delivery group in The UK for several years, Worldline will modernize and transform its service offering by migrating the solutions to a Google cloud based service and replacing the existing ticketing software. Finally, the guidance, based on the performance of the first nine months, we narrowed the 2025 guidance, which is still within the range of the guidance we provided on July 2025, a low single digit organic decline in sales and adjusted EBITDA of EUR $830,000,000 to EUR $855,000,000 and a free cash flow of minus EUR 30,000,000 to EUR 0 plus. Before handing over to Pierre Antoine to conclude the presentation, I would like to mention that we have a slide in the appendix related to the notional cash pool mechanism that would clarify several inbound questions from the financial community on liquidity management. I have looked at this setup, which has been in place at Worldline for over ten years, where the subsidiary cash pooled into BMG, which is a subsidiary of ING, and used for offset at the parent to pay down debt.

My conclusion is that it has been functioning smoothly and efficiently, and I’m willing to take more questions during the Q and A. We look forward to providing you more details on our transformation plan and the free cash flow outlook at the Capital Markets Day on the November 6. Thank you. And now I hand you back to Pierre Antoine.

Pierre Antoine Vacheron, Group CEO, Worldline: Thanks a lot, Vikanth. So as you can see, we achieved a lot during this quarter as per plan. We fixed most of the urgent issues that we had in terms of product delivery and Q3 revenue demonstrate that we are stabilizing our business. This allows us to confirm and to narrow the guidance for the full year. We deliver according to plan the divestment of non core activities with the second announcement, and we simplify our operating model to drive efficiently our transformation and reduce our cost.

I look forward to meeting many of you at the Capital Market Day in Paris in two weeks’ time, where you will have the opportunity to meet a number of representatives from the wireline top management and where we will be outlining the group’s ambition for the medium term. Thank you very much for your attention. And I’m now ready with Frigand to take your questions.

Conference Operator: Thank We will take our first question. And the question comes from the line of Frederic Boulan from Bank of America. Please go ahead. Your line is open.

Frederic Boulan, Analyst, Bank of America: Hi, good evening, Pierre Antoine, and welcome, Streakand. Maybe first question, Pierre Antoine, on your thinking on HBA merchants. So as CEO, do you think the right approach is to keep all the merchants you can legally work with? Or you want to add an extra layer of prudence, potentially create some more questionable segments? And maybe a question to Srikant.

We’d love to have your initial impressions looking at the company with a fresh price. Where do you see the strongest upside opportunity? Any thoughts on the cap structure? I mean, you mentioned the cash pulling structure, but we’d love to hear any thoughts at this stage around the kind of approach to cash, cap structure, credit position, etcetera. Thank you very much.

Pierre Antoine Vacheron, Group CEO, Worldline: Thank you for the question. So I’ll take the first one. So I think what is super important is that the framework that we have is according to benchmarks exactly where it should be in terms of standards of control. The question that we have or the topic that we have is to make sure that each and every entity, each and every regulated entity is applying exactly the same framework in the same manner, so that we can ease the internal controls. On the portfolio, so the portfolio is again, I mean, we’ve done extensive screening, which gives us the comfort on the quality of the portfolio and on our ability to scrutinize it.

So there is no reason to change the policy at the size of this company, all the players to have this type of activities because that’s of the market that we are addressing. The point is to have the proper controls that we are not caught in reputational issues again. Obviously, what may happen is that considering the cost that you are encountering to control this type of merchants where the schemes are much more demanding than standard merchants, we may revisit the threshold of the merchants that we accept so that we have the good economic balance and risk reward balance going forward. Frigant?

Srikant Seshadi, Group CFO, Worldline: Thank you, Pierre Antoine, and thanks for the question. As far as first views of being in one line, two things are important for me personally, a sense of belonging, sense of purpose, and I found that in abundance in one line. And the whole team is energized to deliver the plan. In terms of the specific question on the cash, again, there’s been a lot of questions inbound on way do we manage cash. The cash pool mechanism has been a flexible operational model for the last ten years.

And we can go further into it specifically if you have a question around the cash pool and in terms of managing our own liquidity. In terms of the capital structure and the overall financial plan, we will be dealing with that during the Capital Markets Day.

Frederic Boulan, Analyst, Bank of America: Okay. Thank you very much.

Srikant Seshadi, Group CFO, Worldline: Thank you.

Conference Operator: Thank you. We will take our next question. Your next question comes from the line of Justin Fulso from UBS. Please go ahead. Your line is open.

Justin Fulso, Analyst, UBS: Hey. Good evening, Pierre Antoine, and welcome, sir Crown. Thank you for the questions here. A couple on my end. Wanted to go back to the cash flow.

Apologies to pile on there. Maybe you could just talk a little bit about the the minimum required operating cash at a subsidiary level. So is there whether it’s on a per subsidiary basis, whether it’s on an aggregate basis, I mean, I see that and that’s a great slide. Thank you for providing it. The the 2,300,000,000.0 in in cash you have at the subsidiary level, what is the minimum operating cash?

Because I would presume you don’t wanna get anywhere close to hitting that level. Are are you able to give any lean as well as to what your pro form a 3Q cash is given all the questions that have been coming in on it? And is there any increases or changes to your collateral requirements with Visa or Mastercard as a result of your change in credit rating or any increased capital requirements really anywhere across your operations? And then one follow-up. Maybe you could just talk about the different dynamics in churn.

I I know you mentioned Germany specifically. Seems like things are not improving there. Maybe you could walk through a little bit, in more detail the dynamics at play. Is someone taking share off of you? Are unit economics compressing?

Is there certain verticals where you’re seeing weakness? And maybe just articulate that in a little more detail. Thank you.

Pierre Antoine Vacheron, Group CEO, Worldline: Maybe can you repeat the the last question? I’m not sure we got it.

Justin Fulso, Analyst, UBS: Yeah. It was just related to the churn you were talking about in the slide deck on in Germany.

Florent Eggnol, Analyst, Citigroup: And Okay.

Justin Fulso, Analyst, UBS: Just articulate a little bit of the puts and takes and what’s driving it. Is it certain verticals? Is it is it certain activities? Are are yields compressing? Maybe just talk about that in more detail.

Pierre Antoine Vacheron, Group CEO, Worldline: Okay, Claire. Thank you, Justin, for these questions. So maybe I let Suikanth start with your questions on the cash flow, carat rolls, and I’ll come back on the business question on the churn.

Srikant Seshadi, Group CFO, Worldline: Yes, I’ll start with your second question, Justin, and thanks for your questions. As a result of the S and P downgrade, we’ve not had any change into our business operations in terms of collaterals or anything of that sort. Now in terms of the cash pool itself, as you see there is EUR 2,300,000,000.0 of cash in the subsidiaries, EUR 1,800,000,000.0 is in the cash pool structure. And what we have announced during H1 in terms of trapped cash was in the area of EUR72 million, primarily in India and Asia. As in any company, we would like to strive to take actions on the level of subs cash, which is now used for working capital requirements locally and centralized as much as possible and reduce the level of cash held in subs.

In terms of the global cash needed to drive the business, We’re not a lumpy business, but we do keep a bit of cash for our interest investor volatility in terms of working cap. But as you see there, there’s sufficient liquidity at the parent. And with the pro form a and we did say that we had a €1,200,000,000 liquidity June, where we posted a €40,000,000 of cash. And right now the pro form a is between minus 30. So I wouldn’t expect the level of liquidity end of the year to be substantially different from that.

Pierre Antoine Vacheron, Group CEO, Worldline: Okay. Thank you. And so to answer your question on the churn To answer the question of the churn, sorry for that. So I mean, one key element of the churn has been linked to the lack of availability of POS terminals. All what I explained since April on the fact that we had missed the window of the Android and Exchange terminals in several markets, which is something that we are I mean, we are finishing to cure as we speak.

So that’s the first element. The second element because when you don’t have the terminals, by definition, especially next gen terminals, the small merchants are going somewhere else. The second reason has been a bit linked to that, but decrease in the Net Promoter Score on several markets, which has obviously impacted the churn of SMBs. And the third element is something that we on which we are working and we will share some good news at the time of the CMD is that we’ve been probably a bit passive in terms of digital journey for the small and midsized merchants. That’s something that we are tackling now and where we should be in a much more competitive positions quite soon in 2026.

Justin Fulso, Analyst, UBS: Got it. So just to make sure I’m crystal clear, one, you were talking about Germany as well for the availability of the point of sale terminals. And two, I guess, like, is there any validity to the idea that maybe you’re not able to be in market as much pushing out RFPs trying to drive new sales because you’re dealing with remediating a lot of these issues, and that’s kind of hamstrung you a bit on the outbound sales perspective as well. Is there any of that tied into this?

Pierre Antoine Vacheron, Group CEO, Worldline: No, no, no. Not really. It’s not really the same teams which are taking care of that. And as you know, we have several channel to market for the SMBs. So we direct channel, we have partners and increasing share of partners like ASVs in several geographies.

And we have the bank’s partners, especially in Germany. So the topic is not significant friction coming from the remediation, but it’s much more the three elements that I mentioned.

Craig McDonough, Analyst, JPMorgan: All right. Got it. Thank you

Justin Fulso, Analyst, UBS: very much both. Appreciate it.

Conference Operator: Thank you. We will take our next question. Your next question comes from the line of Gregoire Herman from Barclays. Please go ahead. Your line is open.

Gregoire Herman, Analyst, Barclays: Good evening, everyone. A few questions for me, please. Just the first one on the revenue guidance for the full year 2025. I think it still remains a bit a broad guidance. Could you be a bit more specific on what you expect Q4 to be like compared to Q3?

Do you think we should expect any improvements? Then just on the feedback you made from the Oliver Wyman’s review, this shows that basically there are uneven standards across entities. Do you expect extraordinary costs from actions you may undertake following those review? And then lastly, about the Orchestration portfolio again. I think you mentioned in the press release that no material impact should be expected in 2025.

Basically, how long still this review is going to last? And should we expect any impact in 2026 as well? Thank you.

Pierre Antoine Vacheron, Group CEO, Worldline: Thank you for those questions. So regarding the guidance, if you do the math, you will deduct that we do not anticipate acceleration in Q4. The low end of the guidance would be even some lower performance in Q4 versus Q4 last year as compared to Q3 versus Q3. We do anticipate and it could be better, but I prefer to be cautious at this stage. We do anticipate to be close to stable in MS, And we do anticipate to be more negative on FX because 2024, Q4, we had a number of milestone that we had reached and licensed that we had sold that we do not see as guaranteed in Q4.

So that’s basically the reasons that explain the low end of the guidance. And since you have a project on a phase where you have some uncertainty in terms of reaching the milestones, You have some still some uncertainty in the speed of recovery in some markets on Merchant Services. We prefer at this stage to have a range of guidance, which I admit would be better if it was closer or smaller than what it is. Regarding the Oliver Wyman review, should we expect some extraordinary cost? So the question is, will there be investments to be able to be at the right stand down everywhere?

The answer is probably yes. We want to be much more industrialized, much more automatized that in we terms of KYC, in terms of ongoing due diligence. And that will mean investments that would be part of the plan that we would share in two weeks from now. Last question on the orchestration. So we will we are not far from having assessed the ability of the merchants on which we have some questions in terms of their own license to get certainty or more comfort in their plans to remediate so that we can make the decisions of keeping them or not.

So it’s a question of a few weeks probably ahead of us.

Gregoire Herman, Analyst, Barclays: Okay. Thank you.

Conference Operator: Thank you. We will take our next question. Your next question comes from the line of Hannes Ledner from Jefferies. Please go ahead. Your line is open.

Hannes Ledner, Analyst, Jefferies: Yes, thanks. I would like to double click on the cash pool structure questions. Maybe you can talk a little bit about, like you mentioned in the past, 500,000,000 are necessary to run the business. But given the structure, it feels that you need to keep more on subsidiary level. So maybe you can keep talk us through that for this direction and how much more efficiency you can drive there?

And then the second one, maybe just to understand the MSV trends, given that looks like a flat quarter on quarter performance and how does this relate to Orchestration Layer as a whole. Maybe you can quantify the size of the orchestration layer today. Thank you.

Srikant Seshadi, Group CFO, Worldline: Thanks for your question. I’ll probably take the first one. In terms of the subsidiaries cash, what we have said is the level of trapped cash at $70,000,000 Then there are some cash in the subsidiaries, which still need to be upstream through dividends and so on. We are working through optimizing those balances. They are lower today than the 500 that we had in December.

Since we don’t give the cash numbers, don’t want to talk about them now, Anish. But that’s clearly an area for us to work on to optimize it to the least possible amount. And that’s all I can say in terms of the $506,100,000,000 in terms of the cash that you’ve got in the past to run the business, I would say it’s between EUR 600,000,000 to EUR $750,000,000 would be the amount of liquidity we’d like to keep.

Pierre Antoine Vacheron, Group CEO, Worldline: Okay. And on the question of on MSV, so as second said, NNR is still declining because of the mix of product and customers. But the MSV is as you can see in the slide in appendix, is progressing clearly in Q3, sorry. I have a doubt because I think on the slide, it’s written Q2, but I think it’s Q3. So Q3 is a plus 3%, sorry, of MSC.

The Orchestration area, it’s a totally different story because it’s just a pure gateway. So we are not at all in acquiring or collecting business here. It’s a pure technical gateway of orchestration.

Hannes Ledner, Analyst, Jefferies: Thank you so much.

Conference Operator: Thank you. We will take our next question. Your next question comes from the line of Craig McDonough from JPMorgan. Just

Craig McDonough, Analyst, JPMorgan: the first one, Justin mentioned it, but on the Standard and Poor’s downgrade of your credit rating, just wondering to what extent that’s coming up in client conversations, either prospective or existing clients. Is that having any impact? My second question, if you’re able to give an update on the investigations in Belgium and Sweden, How are conversations going with regulators there? And any time line for resolve? Okay.

Pierre Antoine Vacheron, Group CEO, Worldline: So on the first questions, obviously, I mean, any downgrading is never good news for customers who are committed with you for a long period of time. So following the downgrading, we had active dialogue with a number of financial institutions, which are customers to our line. And but no implication and no consequence of this downgrading as Frickon said. On the And second question

Craig McDonough, Analyst, JPMorgan: on the prospective clients, is it an issue when you go and speak with floor fees and so on?

Pierre Antoine Vacheron, Group CEO, Worldline: No, no. It’s really not an issue. Obviously, everybody is expecting us to present our plan at the CMD. But all the dialogue I have had with the customers and I have met many of them over the last month, I mean, is no significant concern once you have spent time to talk with them. So the business is under control, which is what is important for them.

Sorry, your second question?

Craig McDonough, Analyst, JPMorgan: I was just an update on the Swedish and Belgian.

Pierre Antoine Vacheron, Group CEO, Worldline: Sorry. Thank you. Yes. So obviously, teams have been quite heavily solicited by the various audit that have taken place in several jurisdiction. And we are doing all what is necessary to be obviously transparent and to demonstrate where we stand.

So usually, those audits take some time, not only to be executed, but also to give their conclusions. So we are I mean, it will not come next week, but it will come, I mean, the last over the next sorry, over the next month.

Craig McDonough, Analyst, JPMorgan: Thank you very much.

Conference Operator: Thank you. We will take our next question. Your next question comes from the line of Florent Eggnol from Citigroup. Please go ahead. Your line is open.

Florent Eggnol, Analyst, Citigroup: Hi, good evening. Thank you for the presentation. I just wanted to come back on the cash pooling and the cash around the company. So basically, you have €800,000,000 of cash at the parent level. You have €2,300,000,000 of cash at the subsidiary level.

Does this include any merchant cash at all? Or the merchant cash is fully segregated and not including in those numbers? That will be my first question. And then can you please explain why the cash pooling kept increasing over the last few years? And then why don’t you net it off every year?

And the last question will be around working capital. How do you finance the merchant working capital? In your annual report, you mentioned that there is one, two days of lag between receiving the payments and giving the cash to the merchant? How do you finance that? Do you use your own funds?

Or is it a specific line? And how should we think about that? Thank you. Okay.

Pierre Antoine Vacheron, Group CEO, Worldline: So maybe Srikant will take the first questions, and I will take the two results.

Srikant Seshadi, Group CFO, Worldline: So, thanks for your question. In in what we are calling as our own liquidity structure is how we have our bank account structure, which is the corporate cash account. There’s a segregated account and the safeguarded account. So there is no commingling between merchant cash and corporate cash. There is intermediation accounts where we have this

Pierre Antoine Vacheron, Group CEO, Worldline: net settlement.

Srikant Seshadi, Group CFO, Worldline: So there’s no the merchant cash is a separate liquidity structure as compared to our corporate cash accounts. Second one, in terms of your cash pool question as to why it’s been increasing. The the the beauty and the flexibility of the notional cash pool is we’ve been able to use historically the subsidiary cash to fully be used at the parent in order to pay down group debt. So historically, as we have been able to pool more entities into the cash pool, we’ve been able to have more euros at the group level that is able to be paying out group debt. And and therefore, that’s that’s why that’s been widening because against the widening overdraft as it’s been termed, which is in fact a pool offset, there is a much larger cash collateral in the subsidiaries.

The only way to net it will be to physically move the cash, and we we can’t net it within the it’s already netted in fact within the PMG. So that’s why over the period, it’s been it’s been growing. And for the third question, I will defer to Yes.

Pierre Antoine Vacheron, Group CEO, Worldline: So I mean, in the vast majority of the cases, we are setting the merchants once we have been settled ourselves. There are some markets where there is by exception, because that’s the market practice settlement of the merchant that can happen before we are settled ourselves. And in that in those circumstances, we are usually, we are using a third party to offer that facility.

Florent Eggnol, Analyst, Citigroup: Okay. Thank you. Are you referring to Australia or there is any other countries where you have to No.

Pierre Antoine Vacheron, Group CEO, Worldline: I’m referring mostly to Australia and to some cases in Italy.

Florent Eggnol, Analyst, Citigroup: Okay. And just coming back on your answer about why the cash flow has been increasing. What would happen if BMG were to pull the line, basically? How how would you deal with that?

Srikant Seshadi, Group CFO, Worldline: So first of all, we’ve been having that relationship with BMG for over ten years, and we have a great relationship with BMG. So on the theoretical, hypothetical point that this was to happen, we still have a certain amount of time period within which we can actually go back to that point of netting that you raised and set up an inter co loans and deposits. So again, all of those options are available. We have the notional cash pool, which has been run pretty well over the last ten years, as I said. We have the inter co loans and deposits.

And we’ve checked internally on the regulatory aspects. Have no concerns to do that. And then we’ll need to keep some working cap in the subsidiaries or we can go into the physical cash pool. I come from the physical cash pool world in my previous company. Of those options are open.

I’m one month into the job. So we’ll review that on an ongoing basis and take the most efficient treasury decision for the company.

Florent Eggnol, Analyst, Citigroup: Okay. Thank you very much.

Srikant Seshadi, Group CFO, Worldline: You’re welcome.

Pierre Antoine Vacheron, Group CEO, Worldline: And so I understand we have the last question from Alex from Exane BNP.

Conference Operator: Thank you. Please stand by. Your final question comes from the line of Alexandra For from BNP Paribas. Please go ahead. Your line is open.

Alexandra For, Analyst, BNP Paribas: Hi, good evening. Thank you very much for squeezing me in. Maybe two, three things on my side. First of all, could you comment a little bit on the macro over the course of the quarter, there’s been any inflection during the quarter or in October. I looking at your MSV slide and obviously very stable, consistent with Q2, but I think this includes also contribution from the joint ventures, which are probably ramping up.

So any commentary on same store sales would be helpful. My second question, maybe moving to net revenues. Could you give us a sense of the contribution from the joint ventures in Q3 and how we should think of that in the next few quarters? And lastly, on Financial Services, I mean, the quarter performance is what it is. And I heard what you said looking into Q4, but maybe looking a bit further out, is this kind of, call it mid single digit decline, maybe low single digit decline, how we should think of the division going forward?

And what’s hurting so much in Financial Services, more broadly speaking?

Srikant Seshadi, Group CFO, Worldline: Yes.

Pierre Antoine Vacheron, Group CEO, Worldline: Sorry, So so on the JV yes, so the macro, sorry. So first on the macro, I mean, I hope you appreciate that we don’t claim for the macro. But I mean, clearly, the macro is soft across Europe. There’s no doubt about that. That benefits to the verticals, which are obviously the hard discounters, what we call the box moving verticals to the detriment of more specialized retail, especially SMBs.

So I mean, I don’t like to call for the macro, but it’s clear that the macro doesn’t help. Has there been a significant deterioration? I wouldn’t say so. It’s a soft consumer context that we have, and we cope with that. On the second question, which is the JVs, so I don’t think we enter into this level of detail.

But the JVs I mean, obviously, is the JV’s perimeter is driving the growth, especially with some geographies like Italy, which is doing extremely well on the back of the migration of some merchant portfolio, as you know. Turkey also is doing very well in this scope, in this perimeter. And Australia is not doing bad in Q3 or so. So that’s sorry? And Greece also is doing well.

Yes, absolutely. And the third question was this third question?

Alexandra For, Analyst, BNP Paribas: Yes, on Financial Services and how

Pierre Antoine Vacheron, Group CEO, Worldline: Yes, yes, sorry.

Gregoire Herman, Analyst, Barclays: Yes, yes.

Pierre Antoine Vacheron, Group CEO, Worldline: So I mean Financial Services and we have the opportunity to share much more on that at the CMD. But basically, happens today in Financial Services for wireline is that there has been loss contract loss over the last three to four years, which are impacting which are impacting us which would continue to impact us to some extent in 2026. And in the meantime, there has been very limited wins at significant scale by wireline. Does it mean that the market does not exist or that the market is reducing? The answer is clearly no.

And I can tell you, based on the discussion I have had and the project that I see with the large financial institutions that the potential for growth on FS is significant. The topic that we have is to refill the pipeline of sales, which is starting, then it’s to win, then it’s to deliver the projects and then it’s to generate the revenue. So it’s a long cycle business. And when you have been, to some extent, off the market for several quarters, takes some time to reinitiate the pump of our revenue. But I’m quite positive on that segment, and that’s, by the way, the reason why Madeline Nakaskayes decided to join the company.

Alexandra For, Analyst, BNP Paribas: Understood. This is helpful. Thank you.

Conference Operator: Thank you. This concludes today’s question and answer session. I will now hand back the call for closing remarks.

Pierre Antoine Vacheron, Group CEO, Worldline: Thanks a lot. So I will not add a lot. As you can see, we are fully mobilized. A lot of good things are happening. We are now heading to the CMD, and we hope to continue restoring the confidence in the company going forward.

And I would say that’s the most important topic that we have beyond the confidence of the customers. Have a great evening, and thanks a lot for attending this call.

Srikant Seshadi, Group CFO, Worldline: Thank you, everyone.

Conference Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.