Germany’s Wirecard lifts profit forecast on rising payment volumes
Group expects rise in key earnings metric with payment processing volume up 37%
Wirecard has lifted its operating profit forecast after the volume of payments processed by the German financial services company that is in the midst of an accounting scandal grew vigorously at the start of this year.
The group said on Wednesday it now expects earnings before interest tax depreciation and amortisation for this year of between €760m and €810m, compared to the previous target of €740m to €800m. It had generated ebitda of €560.5m in 2018.
Wirecard’s ebitda between January and March was 41 per cent higher than in the same period a year ago, the company reported on Wednesday. At €158m, it was slightly above average analyst expectations according to data by S&P Global Market Intelligence.
The German company said payment volumes jumped 37 per cent to €36.7bn in the first quarter.
Wirecard had confirmed its previous guidance only two weeks ago when it reported 2018 results. An accounting scandal in its Asian operations had forced the Aschheim-based group to postpone the publication of its annual report by three weeks.
Wirecard disclosed that some employees may face criminal liability in the group’s Singapore unit, where it is embroiled in a police investigation into suspected forgery and fraudulent accounting.
According to the report of Wirecard’s auditors, there is no evidence that 2018 annual results need to be corrected with regard to the Singapore accounting issues. However, it said the investigation by police in the city-state may lead to new insight that could affect the accounting of Wirecard.
Wirecard said that an independent investigation by an external law firm found that the suspicious transactions in its Singapore division had “no material impact” on its financial reports.
In the first quarter of 2019, Wirecard reported a 35 per cent increase in revenue to €567m and a 50 per cent increase in net profit to €106m.