eServGlobal's revenue expectations fall

Mobile financial technology company eServGlobal, dropped their expectations for its year-end revenue in a trading update on Monday.

Revenue for the financial year ended on 31 October 2016 is expected to be below guidance between €14m to €14.5m.

The company is however confident it will turn the business around due to the “significant” growth in orders. The total contracted bookings was 60% higher at over €21m than in 2015.

Costs are expected to be in line with expectations at around €19.5m, down from €23,8m in 2015 due to focused management and restructuring.

The cash balance at the end of 2016 is expected at around €6.4m.

The company has signed its first major channel partnership, showing market support for the redesigned software platform PayMobile 3. The partner operates in areas of Africa which the company has historically struggled to penetrate. The group expects significant growth in regional opportunities in these areas over the next five years as a result of the deal.

The group is also pleased with its continuing progress of the joint venture with Mastercard. HomeSend, a global payment network, has continued to increase its send and receive footprint globally through the Mastercard Send digital platform. The venture is on track for breakeven in 2017.

The board has also appointed the former head of finance at Hurricane Energy Andrew Hayward as their new chief financial officer.

Looking ahead to 2017, the core business is positioned to grow sales significantly following the increased order flow. Costs will be €1m below the current €18.5m.

Executive chairman John Conoley said: “I am proud of the achievements of the company in its core business in FY16 after its poor start. Although we did not fully recover from that start by the end of the financial year and reach our target of cashflow breakeven, we have embarked on FY17 with justified optimism in the core business.”

The share price fell 2.04% to 6p at 1303 GMT on Monday.