Worldline Sa Ord

Good day and thank you for standing by. Welcome to the Worldline Q1 2026 Revenue Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 to 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1, 1 again. 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.

Thanks a lot and good evening to all of you. Thanks a lot for joining us for this Q&A release at Worldline. and I am obviously with Shadri, our CFO. So let me start with a few snapshots on Q1. So overall, as you will see, Q1 reflects a business that is now stabilized, refocused, and shifting from repair to execution. After the capital increase and the exit of Australia that we announced this evening, we have renewed foundations from a scope and financial perspective. A quarterly revenue which is in line with expectations and which gives us some confidence on the full year trajectory. Finally, a company that is fully focused on operational performance and cash flow trajectory. So first on the scope and financial foundations. So with New Zealand and Australia announced this evening, we have now completed our geographic refocus, and portfolio pruning. Those two businesses were far away from our core geographies. They needed further investment and were sources of distraction. And I'm extremely happy to have found a deal with ANZ, our partner. At the end, in total, this is seven disposals announced in 10 months, two of which already closed. and that enables us to focus now on our mandate, payments excellence and leadership in Europe. At the same time, we successfully executed a 500 million capital increase with a 121% take rate on the right issue, underscoring strong market support in a fairly adverse environment. Importantly, Our shareholder base has been reinforced with long-term European and core investors who now represent around 37% of the share capital. Taken together, these actions give us a much stronger financial foundation and remove key uncertainties that have weighed on the group over the past two years. This allows us to move forward with North Star 2030 while maintaining a clear focus and balance sheet discipline. In terms of business dynamics, slide 7 illustrates the underlying operating dynamics. On a fully pruned basis, which is what matters, group revenue came in at €831 million, down 0.5% organically, in line with expectations. Merchant services have turned positive. with revenue up 1.6% organically. Although it has been boosted by non-recurring positive items, this is the first quarter of growth since Q4 2024, driven by volume momentum across in-store and online channels. SMB churn is stabilizing, although performance remains uneven across geographies, with Switzerland and Benelux still in recovery phase. Enterprise is growing, driven by mobility and self-service. Global commerce decline as expected, impacted by deliberate credit derisking and churn, while travel and hospitality remain solid. Our focus is now to reboost our presence in digital, on the back of product innovation, and change in sales management for this segment. Financial services declined by 7.4%, reflecting previously lost and decommissioned contracts. This drag will continue through 2026, but we are rebuilding the growth potential. Q1 has seen, and Stricount will come back on that, several contract renewals and extensions, and we have a strengthening commercial pipeline that will build revenue back-end loaded. We do see concrete product traction and shift in client behavior getting more reassured after the capital increase. Let me hand over to Srikanth now, who will provide more color on the Q1 performance.

Thank you, Pierre-Antoine, and good evening to you all. Pleasure to be with you. So on the next slide, we see the status of the pruning program. Glad to say that this is over. So we had the non-core payments with METS Citrel divested, non-synergetic payments with North America Payment IQ, India, Australia, and New Zealand. And we have closed North America and Payment IQ with cash proceeds of 225 million euro received in Q1. And we expect, as Perantwan mentioned, that sum total to be 590 to 640 million euro, all of them to be closed over 2026. and with India and the Australian JV to be closed in H2 of 2026. Moving on to the next slide to explain a little bit more the divestments in the Pacific. So Australia, we had 107 million euro of EV with a net proceeds of 30 million euro coming in to us subject to closing adjustments. And on New Zealand, as announced already earlier, 17 million of EV with 20 million Euro of net proceeds subject to closing adjustments. The financial implications that you see at the bottom is the revenues for the combined entity in excess of 200 million, adjusted EBITDA of 30 million. And you'd recall that we had said that these were a cash drain on our company. So along with India, Australia, and New Zealand, they were essentially draining the cash generated from PaymentIQ, so net zero in terms of free cash. Moving on to the next one, now in terms of revenues, Q1 is in line. As you know, we detailed that a little bit more during the full year regarding the IFRS 5 for a perimeter change. So we have two perimeters here. The one that we've guided the market on is the fully pruned scope, i.e. it excludes all the entities that you've seen in the previous slide. And then we have the published revenue, which only removes the discontinued operations of METS, as well as those which have been closed, which is North America and PaymentIQ since March. So those are the two scopes. So on the fully pruned scope, we came in at €831 million, which is a slight organic decline of 0.5%. In merchant services, we generated €652 million of revenue, with an organic growth of 1.6% on external revenue, the first time we've seen a positive since Q4 of 2024, and a slight decline of 0.7% in net revenue terms. On financial services, sales came in at €182 million, down 7.4% year-on-year. So as you can see, merchant services is clearly showing some signs of stabilization and growth, while FS is still impacted by client terminations from the past, as anticipated during our previous communication. On the published revenue, €924 million with an organic decline of 1.5. Merchant services generated €742 million, flat in organic terms and down 1.4% on net-net revenue basis. Financial services contributed to €182 million, down 7.4% year-on-year. Going on to merchant services on the next slide, looking deeper on the fully pruned basis, Our SMB business had contrasting dynamics within it. Acquiring grew, whereas the GoPay migration induced a churn on acceptance. And regarding the geos, Nordics and Germany grew well above the rest, whereas the Southern Europe with Italy, Greece, and our Central and Eastern Europe continued underlying growth, and Switzerland and Benelux still in recovery phase and progressively showing stabilization. We are seeing increased traction on ISVs and partners across Europe and as a strategic axis of our growth as highlighted during our capital markets day. In enterprise segment, growth is driven by mobility and self-service verticals. We continue to see positive commercial momentum and it offsets some churn in the retail sector. Globally in enterprise, we see a mid single digit growth in merchant sales value and a number of transactions as well in online and in-store, which shows a healthy underlying evolution. Finally, on global commerce, sales were lower driven by some expected remediation actions and softer flows, notably in digital. We have initiated a turnaround plan on that. We've also seen good growth in travel and hospitality, leveraging our leading product expertise in that segment. Moving on to financial services, As I said previously, the revenue decline is linked to our legacy contract terminations. Our pipeline in FS remains strong, boosted by a number of recent wins and upselling in Q1, notably the PSA in Austria, with whom we are enhancing the Wiro end-to-end solution, the renewal of issuing and acquiring processing contracts with the Tier 1 bank that we announced earlier, as well as renewal of several digital services contracts with La Banque Postale. Moving on to the next slide regarding the balance sheet strengthening, now we've completed that. With our pruning program, as outlined earlier, the successful capital raise that we have done have paved the way for a stronger balance sheet and liquidity profile. The net proceeds arising from the reserve capital increase and the rights issue came in at 470 million euro received in April, and regarding divestments, I have already outlined that earlier. With these, we confirm our expectation to reach our leverage target, i.e., the net debt over EBITDA of 2X by the end of the year. Moving on to the last slide on the outlook, we confirm our 2026 outlook on a fully pruned scope, low single-digit organic growth in terms of revenue, adjusted EBITDA between 630 and 650 million euro, free cash flow target of minus 80 to minus 70 million euro. And as of today, we have not seen a material impact on the geopolitical context, and we'll continue to monitor them closely. As Piyantwan mentioned, Q1 was boosted by some non-recurring items. We expect Q2 to be softer on a year-on-year comparison, resulting in a slight negative H1. MS will continue to show further signs of turnaround and underlying growth more pronounced in H2. FS momentum will be progressively seen more in H2 due to the recognition of build milestones from the new contract wins. Thank you for listening, and I'll now hand you back to Pierre Antoine to conclude.

Thank you, Srikanth, and as you've seen, Q1 is a new milestone in the turnaround of the company. But I would like to highlight now some of our underlying achievements that make us confident in our trajectory. Slide 15 shows momentum across the organization on our three focuses, operational performance, North Star, and innovation. In terms of operational performance, the churn in SME is stable across the board, despite the impact on acceptance coming from the migration from Ogon to Gopay on the SME merchants. The focus on customer excellence is paramount, and we now monitor the NPS every month in each geography. This will allow us to continue to reduce the churn, which is a must. In enterprise, mobility and self-service is doing extremely well with high single-digit growth on the back of a unique restored positioning. We are now tackling retail on the back of our one commerce value proposition. We have a unique position across Europe Improving the product will unleash our potential. In financial services, momentum is growing from a sales and third leadership perspective. We are positioning ourselves on the topics that matter the most today, fraud, bank wallets, digital euro in particular. Northstar is no longer a plan on paper. It is firmly in execution mode with clear milestones and accountability across the group. In Q1, we have fully migrated the Wopa platform in Argentina towards global collect with cumulative cash cost saving of 7 million of Euro on a full year basis. Significant part of it was already in our books because it's a sequential demigration that we have done, but that shows you the magnitude that you can get from closing and converging platforms. Regarding GoPay, our European e-commerce solution, we reached now 68% of the Ogon SME portfolio having migrated to GoPay, coming from 50%, you will certainly remember, at the end of December. On acquiring, the Italian portfolio pilot has been successfully launched, and the ambition is to have finalized the migration of this portfolio to our target acquiring platform in the course of 2026 with double digit savings anticipated impact. And you remember that the total savings that we anticipate from platform convergence is 100 million of euro by 2030. An additional milestone is the fact that we have returned two licenses to the regulators, which obviously contributes to simplify the organization and reduce the overhead. These execution milestones of Northstar are critical, not just operationally, but because they improve resilience, reduce complexity, and support scalable growth going forward. Finally, this quarter shows that Whirline innovates as expected by its clients. On innovation, I would like to give you three illustrations. In those times where everyone speaks about sovereignty in Europe, we make it happen. Worldline now supports nearly all major European wallets, including Wiro in Germany and Belgium, while we are supporting Austrian banks through PSA to make these payment solutions available in the country. Besides, for global commerce customers, especially on the digital goods segment, We join the very few PSPs able to offer recurring payments for subscription management. This is a long-awaited feature that will help us to rebound in this segment. Finally, Circle selected Worldline to be the European go-to market for their new CPM management payments, with Worldline acting as a European integration and enablement partner to ease settlement in stablecoins. So to conclude, Worldline now stands on much stronger foundations, a simplified and focused European perimeter, a reinforced balance sheet, momentum in our operational performance and transformation. In a volatile environment, our priorities are clear. Execute, deliver on North Star 2030, and restore sustainable growth and cash flow generation. Thank you all and happy to take your questions.

Thank you. If you wish to ask a question, you will need to press star 1, 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1, 1 again. We will take our first question, and the question comes from the line of Frederick Boulan from Bank of America. Please go ahead. Your line is open.

Hey, good evening. Thank you very much for taking the question. Two, please. Firstly, around MS, so back to growth in Q1, if you can discuss a little bit some of the underlying drivers, any merchant wins, anything you can share on pricing. I mean, you have the 3.5% volume growth. So implicitly, are we seeing pricing compression or the pressure is more coming outside of acquiring? And if you can repeat the commentary around Q2 and what drives that. And the second question maybe for Srikanth around the leverage. So we'd love to hear any updates from agencies. How do you expect those disposals to impact your credit rating considering the free cash flow burn and EBITDA guidance for 26? Thank you.

Okay, so... Should I take the second one first?

Yeah, take the second one. Hello, Frederick. Thanks for your question. So on the S&P, of course, after the Capital Markets Day, we had another review with them before the full-year announcement was done. They followed our full-year results with a bulletin because they felt that it was not necessary to go back to credit. because it was consistent with what we had presented during the capital markets day. And the numbers we presented to them was on a fully pruned basis. So we are good and consistent with everything we've said so far. So we expect the leverage calculations to be in line as well.

OK, thank you. So regarding MS performance, so as you have in mind, SMB is 50% of the revenue of the company, the external revenue of the company. In SMB, as Srikanth said, we have obviously diverse performance depending on the geography. We are typically extremely satisfied with the acceleration of growth in the Nordics, and more particularly in Sweden, on the back of strong performance with partners and ISIS. But the performance of Greece, Central Europe has been good also, as well as Germany. And Germany is the second quarter where we have strong performance in SMB. Italy, obviously, has been boosted for the last quarter, and that gives you one element of answer to your question by the migration of merchant portfolio from the banks that started one year ago. You remember Credem in particular. And where the situation remains a bit more difficult, it's in Switzerland and Benelux. So Benelux is starting to recover, to improve. The NPS is improving. But it remains a journey. And Switzerland, obviously we are in a defensive stance in a market where we have very strong position. This is also a market where we've been suffering from reduction of heat rate in DCC, dynamic currency conversion. because of the change of behavior of the consumers during this period. In enterprise, as we said, we are growing, and this growth is mostly coming from mobility and self-service. We are today still more in the defensive stance on the retail part of this business, but to the contrary, mobility and self-service It's a high single-digit growth, especially in transportation. We extended the partnership with the French tube company, but also with the French . We have a very dynamic traction with on EV charging, to give you some examples. Regarding global commerce, We have a strong traction at the end of this quarter of the global collect platform, but global commerce globally is declining in Q1 for various reasons linked notably to churn that we pushed, linked to ongoing due diligence, what we call ODD, but also credit risk assessment on some verticals. So in a nutshell, this is the way we see the situation. So I will not mention very strong price pressure per se. It's more, so some geographies are facing more price pressure than others. But it's really the behavior of a business in a turnaround situation. Some segments progressing faster than the others.

Thank you. And if I may, a quick follow-up to Shrikan's point around the leverage. So the bulletin from March, we're still talking about a double B and negative outlook and confirming the U numbers, so it's aligned on numbers, but we begin to understand, considering the half a billion cap increase and the 600 million of disposals, are we still in that kind of double B and negative outlook territory, or if you're saying that that could change considering the execution on those two items.

Frederic, yeah, I mean, I leave that to our experts in S&P to decide, but my view, I mean, there is, again, two parameters on which S&P is rating us. One which is on leverage, and one which is the free operating cash flow over debt that needed to be above 10%. And one of the points we mentioned during the Capital Markets Day is because we knew that the 2026 will be negative cash. We needed to get some runway on the leverage, because at double B, we needed to be less than four, hence the quantum on the sizing of equity. Gives us a bit of runway, so the negative outlook is there, but I guess execution is the only way to stabilize this thing. But the free operating cash flow over debt to be above 10% is the second factor that we need to show.

Okay, very clear. Thank you. You're welcome.

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

Thank you very much, Pierre, Antoine, and Srikant. A couple from my end, if you don't mind. Srikant, I just wanted to make sure I understand the puts and takes with all of the acquisitions, and in particular, the free cash flow impact, I think, and correct me if I'm wrong here, the implication is that the fully pruned guide reflects a, I guess, negative contribution in net from all the acquisitions. So if you could just walk us through each of the different deals and what the positive or negative free cash flow impact was there, and maybe just confirm the overall take that that across all of them there was a negative free cash flow impact that would be they'll be helpful and congrats on getting the ANZ and all the pruning done I understand that was a really big really big effort if we could just talk about ANZ for a second because I think that was a business that was purchased for 250 300 million euros something like that so we're now talking about net proceeds of 30 million euros generating negative 30 million euros in free cash and it sounds like dilutive to revenue growth. So maybe, you know, clearly things have changed since that asset was purchased, but maybe you could just walk through, Pierre-Antoine, in a little bit of detail, maybe the trajectory. And I know you weren't here, but walk us through what happened between 2021 and today with that relationship. Thank you.

Hello, Justin. Good to have the question from you. Let me take the first one, and then we'll answer the second one with Pierre-Antoine. On the impacts, I'll break it into two. There's the CMD scope and there's the post-CMD scope. If you recall at the CMD when we had the METS, Citrel and North America, we said that the impact of all of those was something like 110 million on adjusted EBITDA and 55 million Euro of cash. Then what we said as well is that on the post CMD when we talked about payment IQ India and now we can say that it is Australia and New Zealand we said that there will be another 90 million euro of EBITDA and zero cash because payment IQ was essentially generating 30 million euro of cash which was and you've seen now the Pacific was draining the 30 million India was very limited in terms of cash so plus 30 minus 30 said neutral cash So that's really on adjusted EBITDA, 110 million on the CMD scope, 90 million post-CMD for India, Pacific, and PaymentIQ. And cash, 55 on the CMD scope, neutral thereafter. And on the revenue, you recall, 500 million at CMD scope, 400 million after, so 900 million. So what we were saying is we were a 4.5 billion euro company. became 3.6 billion euro, so 900 million, i.e. 20% reduction in top line. We also said that 840 million becomes 640 million because of the 200 million reduction in ABDA. And, in fact, we had a total impact of minus 55 million on the divestments, and there was an underlying cash negative on the core post-prune business. Hence, we had the minus 70 to minus 80 million as a guidance for 2026. I hope that answers it. So it's exactly what we presented during the full year. We reconfirmed that, so it's been consistent across our various calls. On the ANZ relationship, I'll hand it over to Pierre-Antoine.

Thank you, Sri. No, so I mean, I was involved obviously in the whole history of ANZ. I mean, looking at it to some extent from the outside, I would just make two comments. One is that we have changed, unfortunately, of era in terms of multiples in this industry, and that's a fact. And I guess that when the deal was done, it was at the peak of the fever of consolidation in this sector. So I think that's one element. And the second element is probably there were some significant synergies that were anticipated. And the history has proven that they were more difficult to materialize, especially because of the distance between Australia and Europe, which is not neutral.

Yep. Got it. That's very helpful context and understanding that you weren't there. Just maybe one quick follow-up then, Pierre-Antoine. I feel like we haven't heard about the Credit Agricole joint venture in a little bit. Maybe you could just update us on progress there. And I think you were running two systems, perhaps trying to bring small businesses across to the combined platform. Kind of maybe just update on the progress there. Thank you so much.

So we have made some steps on the acceptance side of the partnership. So GoPay is our e-commerce solution is distributed now within the branches of Crédit Agricole and that's been the case for the last eight months already. And we have been successful on the enterprise segment also between the access acceptance solution and the acquiring of Frédéric Ecole. We are still working on the next step and the right model to select for the SMB segment, having in mind that the banks in France want to keep the acquiring of the SMB segment. So we are working on this. I already said since I joined that the magnitude that we have in mind wouldn't be what was initially considered because we challenged some of the assumptions and some of the options of the model, especially from the enterprise acquiring, which is not profitable. So I found it was not that interesting. So this is where we stand, and I hope to be able to share more during this summer.

Great. Thank you so much, both. Appreciate it. Take care.

Thank you. We will take our next question. The question comes from the line of Hannes Leitner from Jefferies. Please go ahead. Your line is open.

Yes. Thanks for letting me on. I've got also a couple of questions. The first one is, when I'm looking at your 25 accounts, I think you disclosed around 150 million translated Australian dollars. Now you talked about 230 million. So maybe you can talk us through there about the gap. Then we always appreciate when you give the volume data, you talked on the slide of 3.5% without naming the absolute amount. So maybe there is some scope changes. Can you talk us through maybe on MSV level? And then maybe just like in terms of the platform pruning, platform convergence, I think that sounds all very interesting. Maybe you can give a little bit more color on some obstacles for merchants. Should you anticipate some acceleration of some problems? And lastly, you talked about non-recurring revenues in Q1 in merchant services.

Maybe you can elaborate on that. Thank you. So this is many questions.

So I need clarity, Hannes. Hello. On the first one, you said something on the 25 accounts, $150 million and $230 million Aussie dollars. Could you repeat that part again, please?

Yeah, of course. So you give in your accounts, the currency split, and you had 3.7% reported in Australian dollar. which, based on your post IFRS 5 numbers, would give you 149 million of the dollars. Euro, sorry, euro. And we can take that offline.

Yeah, yeah, I'm happy to. I mean, in terms of the two boxes we said during the thing, We said there was, for the PaymentIQ India and to be signed, we said 400 million euros of revenue and 90 million of adjusted EBITDA, of which Pacific was half, which is the 225 million euro you see now. Happy to take any reference on what you're mentioning offline, but there should not be any inconsistency. Your second question was on the 3.5% of MSV level that you were mentioning, Pierre-Antoine. And then there was one on platform convergence and non-recurring revenues, if you will.

Yeah. So I think your question was what is the basis of growth for those 3% growth. So I don't have top on my mind, to be honest, the pro forma volumes as compared to the 450 billion MSE that we shared last October. I don't think it has significantly decreased because of the disposals that we've done, but we will update in each one. On platform convergence, so what we are seeing today What we are seeing today is a bit what I explained already last year, which is that when we are speaking about the acquiring platforms, especially the back-office acquiring platform, which is the one on which Italy is migrating, we do not anticipate special difficulties or churn. The key point is usually to align the back-office processes for the merchants, how we manage the chargeback, how we manage the report in terms of settlement, these type of things. So that's something on which we are preparing very carefully before starting the migration, starting the pilot. But if I take the example of Italy so far, It's hard work, but it is smooth. Where it is more sensitive, it's when you are talking about acceptance, especially on e-commerce. And as we said, especially for the SMB, the volatility when you do platform convergence is higher. And this is one element that has impacted already Q1 and that will continue to impact Q2, but to some extent a bit lower than what we had in mind. So do we expect more challenges than that? Not really. So it's really a point of discipline execution. We are not, in any case, not speaking about merging platforms. We are just selecting a platform put it at the right level in terms of features, and then asking the merchants to change the API or to migrate directly the merchant from the back-office. On the non-recurring of Q1, so we wanted effectively to be very transparent. So Q1, we are happy with the growth of merchant services, but there are some non-recurring items Typically, we have now almost finalized the migration of the Italian portfolio. And that means that in Q2, we will run at the speed of the Italian market, for which I know that you have many information coming from the competition. The same, we had some some extraordinary, not extraordinary, but not recurring items in some geographies that will not be repeated in Q2. So that's why the underlying trend that we foresee for merchant services in Q2 is quite consistent with what we have in Q1, but that means slower growth in Q2 than in Q1.

I hope this is clear for you. Thank you.

Thank you.

We will take our next question. And the question comes from the line of Alexandra Foray from BNP Paribas. Please go ahead. Your line is open.

Hi, good evening. Thanks for letting me on. Just had a quick question. If you could update us on, I think you had the intention to renegotiate and push out some of the put options you have with Greek banks and Italian banks. Just wondering how this is progressing, and I'd say in the same vein, is there any update when it comes to the Belgian investigation or the Swedish inquiry, or we should really stop thinking about those things too hard?

Thank you very much. I'll take the put options, and I'll hand you back for the investigation.

Hello, Alex. On the put options, you know, we were looking at this for additional room of maneuver on liquidity. We have enough liquidity, so we'll potentially just use our liquidity on the Greek one for sure, and then for the Italian one most likely. But that's more an H1 topic. We have a bit more time, but it's likely what we do.

And on the second topic, I mean, the outcome of the inspections from the various regulators is not yet known, but we've been engaging very closely with them so that hopefully this is under control. that will come in the coming quarter at the base of the administration, if I may say so. And one of the key topics for us is to make the right progress on the remediation that we have initiated and for which, as you know, we are spending quite a lot of money in 2026. Regarding the prosecutor in Belgium, he's also pursuing his investigation on what may have been AML issues in the past. Again, at this stage, there is no special comment that we can make.

Thank you very much.

Thank you.

We will take our next question. And the question comes from the line of Herve Dravet from CICIB. Please go ahead, your line is open.

Yes, good afternoon. Thank you for taking my questions. First one is regarding, sorry to insist, but on mentioned services, how much of those non-recurring items, I mean, can you give a bit of an order of magnitude how big they were? I did not catch exactly the size of those non-recurring items. And the second question is regarding the churn. I was wondering, could you share with us some detail about churn, especially in financial services, if you have seen some, and also in merchant services in SMB, I mean, you say the churn stabilized across all geographies. Is there some which are really progressing very positively and others, you know, lagging, if you can give a bit more light, you know, on those differences?

Thank you. Okay.

So, on the first question, Let's say that excluding the non-recurring items, we are still growing in the merchant services, so which is a significant improvement as compared to Q4 when we were still at minus 1.4, if I remember correctly. So that's what I have in mind on the first question. On the second question regarding the churn, So on financial services, we are exactly where we were supposed to be, meaning we have something like 60 million of revenue that we are unfortunately offloading in the course of this year. And it's quite spread across the four quarters on an equal basis. And today we do not have any additional non-renewal of contract. But as you know, in financial services, it's a long-term contract and we are progressing well in the renewal, even if the troubled times in which we've been in 2025 has caused some delays in some decisions for some significant renewals, which explains also why we are a bit lower than what we would have liked in terms of a build in 2026. Regarding SMB, it's strangely enough quite consistent in all our geographies, this churn in terms of stabilized in 2026. versus the same period of 25. Obviously, not starting from the same position. And clearly, the ambition we have is to reduce this across the board in our various geographies based on the initiative that we have taken, starting with measuring the NPS every month on our respective portfolios. Okay.

Thank you. That's clear. Thank you.

Thank you. We will take our next question. The next question comes from the line of Emmanuel Matos from ODABHS. Please go ahead. Your line is open.

Hello, Pierre-Antoine. Hello, Srikant. Two questions for me. First, do we have to be concerned about Ingenico's serious financial difficulties? To what extent are you diversified in terms of your supply for payment terminals? And second, how long will it take for financial services to return to growth, according to you? When will we see an end to the negative impacts of previous contract losses? Thank you very much.

So on the first question, we are obviously monitoring the situation of our historical partner. especially because we are still bound to them until the end of 2027. So we have today alternatives that have been growing with some other providers, but in some geographies we are still very much dependent. So we are obviously, and based on all the rules that we have for continuity of business, we are working on potential fallback solutions. That's for the first question. The second question was? FS. FS, yes. So, I mean, we said, if you remember the CMD, we said that it would take time to rebuild the growth engine of FS because the because of the sell cycle in financial services. So obviously there are some small deals that we can win and get the bid very quickly and then generate some transactions. But in most of the cases, when it's a big project, which is what we are looking for, it's something like 12 to 18 months of decision, then it's... It's one year, one year and a half of build, and finally you get the transaction volume. So that means, and this is what we said, that it's more mid-27, maybe beginning of 27, but really mid-27. And if we are good in execution today, that we would see a real turnaround on financial services, which is totally in line and consistent with the trajectory that we gave for Nostar. We had a discussion at the board this morning. I remain extremely committed to financial services because of the intensity of the discussion we have with several financial institutions across Europe. And this, not only on the legacy topics, but also on the emerging topics, typically the pilot on digital euro is a topic on which we are highly interested for the banks. Helping the banks to be enabled for agent e-commerce is another topic. And so all this shows that there is traction, that this year has the right partner for them going down the road. And the banks are overwhelmed with the needs of investment. And so they value really the presence of our line in the industry. So it takes time. I'm not surprised that it takes time. But I'm confident, especially because now we have a new setup. Madalena Cascais is doing a great job in terms of interacting and pushing for positive decision with the banks. And her team is behind her. while this business had been a bit left behind in the previous times where there was so much focus on merchant acquiring. Thank you very much.

Thank you.

Okay, last question.

Once again, if you wish to ask a question, please press star 1, 1 on your telephone. We will take our next question. And the question comes from the line of Craig McDowell from JP Morgan. Please go ahead. Your line is open.

Hi, good morning. Oh, good evening. Thanks for taking my question. Just the first one on net net revenue in MS. Just obviously down again this quarter, contribution margin down. Just comment whether that's consistent with your plan and guidance for 26. And then how should we expect that trend through the rest of 26? Obviously growth in verticals, which might have a lower contribution margin like travel and hospitality. But if you just comment to that and then have a follow up as well, please.

Yeah, thanks for that question. If we see the Q1, we've seen the headwinds on our key markets still on Switzerland and Benelux, which is in recovery phase. And obviously, we expect that to show further signs of stabilization in Q2 and carry the momentum into H2 that should be accretive for us. And the same to go with FS, which are both our key strategic axes for growth and hence, accretive. So, the contribution margin should improve. We did expect and fed in, if you recall, during the capital market day, we did say three blocks. One of the blocks was the FS headwinds. Second one was the business mix. And the third one was all the stuff that we said we'd do on the remediation. So the business mix is still recovering. So we have budgeted this. We have fed this. But we expect this contribution margin to be better in H2. Thank you. And the other question was?

The other question, on the Q4 call, you had mentioned about some plans off-boarding and MS occurring, sort of a hangover, I guess you'd call it, from 23 and the issues you experienced there. Just checking whether that's in the Q1 number or how should we think about that phasing of off-boarding in 2016?

So no, from 2023, we had 130 million euro that we had off boarded on the high risk.

Yeah, that Yeah, my understanding was a key for there was he talked about further off boardings impact into moving away from worldwide.

Yeah, we sorry, yes, we see we see have some minor I mean, minor It's something like one or two millions of ongoing due diligence on the global commerce side of things that have led to outboarding. So it's really the end of what we wanted to achieve in terms of ODG remediation. Yeah. OK. Thank you.

Thank you. This concludes the question.

Sorry, just one point, maybe back to Hannes. I see what you're talking about, the 3.7% of the AUD mix in our total revenue at 4.5 billion, which was the full scope. Probably we are talking about 3.7%, which is in the 160, 170 million range. And the 225 we're talking about is last year to what we see in 2026 first. And then we have New Zealand on top. adding to the 220 million that we've mentioned. And if you need further data, we could provide that offline, indeed. Back to you.

Thank you. There are no further questions. I would like to come back for closing remarks.

Yes, thanks a lot for that, and thanks to all of you for attending this call. The closing remarks are very simple and consistent with my opening remarks. We have done clearly all what was needed to stabilize this company, to refocus this company, and we have shifted from repair to execution. We have a sound balance sheet, we have a scope, which is consistent with this mission to be the European leader in payments for Europe and finally we are step by step in a very disciplined manner executing our North Star Plan with some good elements in Q1 and step by step we continue this recovery. Thanks again and happy to see you soon. Thanks everyone.

This concludes today's conference call thank you for participating you may now disconnect.