North America Proved Difficult for Ingenico Last Year

Ingenico Group’s business generated through North American banks and merchant acquirers had a difficult 2018, the company reported Tuesday.

Full-year revenues from North America within the Paris-based point-of-sale terminal maker and payment processor’s Banks & Acquirers segment declined 9% year-over-year on a constant-currency comparable basis and 13% as reported to €163 million ($184.1 million at today’s exchange rates). Comparable bank/acquirer revenues fell 16% in the Europe-Middle East-Africa region and 4% in Asia, but Latin American revenues grew 36%. In all, the bank/acquirer segment produced €1.31 billion in revenues, down 4%. Banks & Acquirers accounted for 49% of the company’s total revenues of €2.64 billion ($2.99 billion).

“Starting with B&A, the year has been challenging. We have suffered in our most mature markets, i.e. EMEA and North America,” new chief executive Nicolas Huss said in a conference call with analysts, according to a Thomson Reuters StreetEvents transcript. He attributed part of the bank/acquirer slippage to “lack of execution” as well as two big orders in late 2017 that resulted in lower comparable figures in 2018.

In its earnings release, Ingenico also said “activity has been impacted by the lower than expected contribution of EMV renewals in the United States, which was slowed down by a longer certification process.” Sales of the new Axium product, an Android-based POS platform for small merchants that uses Ingenico’s Telium Tetra operating system, also came in lower than expected.

The situation was brighter in the Retail segment, which includes online processing and revenues from large as well as small and mid-size businesses. Comparable revenues increased 8% to €1.34 billion ($1.51 billion). Ingenico doesn’t break out that segment’s revenues geographically.

Huss said the bank/acquirer segment is being “repositioned and optimized to benefit from ongoing opportunities.” Ingenico also is continuing its expansion into processing and digital payments. It owns 52% of Ingenico Payone, a new joint-venture payment processor in Germany. And last month it completed its acquisition of New Zealand’s Paymark payment network.

Ingenico reported net income of €189 million ($213.5 million) for the full year, down 26% from 2017, partly because of an accounting change.