Network International’s half-year revenues reach $239m

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Dubai-based Network International Holdings’ half-year revenues surged by 17 per cent to $239m compared to the same period a year ago, driven by business growth in the UAE and Jordan, with merchant services up 30 per cent and outsourced payment services up 7 per cent.

The payments firm said the Middle East region witnessed significant growth in the value of merchant payments processed from domestic consumers and international visitors, increasing 28 per cent and 53 per cent year on year (YoY) respectively.

Network said growth was driven by the UAE’s resilient domestic consumer spending and a strong influx of tourists.

The total value of consumer payments processed by merchants jumped by 31 per cent YoY, driven by the company’s focus on the high growth small to medium enterprises (SMEs), online and hospitality sectors.

Network’s profit for the period was $35m, up 9 per cent YoY, as the company’s strong underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) growth was slightly offset by higher net interest expense due to rising market interest rates and a higher effective tax rate due to growing profits across Africa.

The generated robust underlying free cash flow of $65m, up 64 per cent YoY.

“Our performance continues to be supported by the acceleration of digital payments growth across key markets but is also evidence of our successful strategic execution, competitive services and product offering,” said Nandan Mer, CEO of Network International.

“Performance in our home market of the UAE has been particularly good, where we have seen consistent market share gains in direct-to-merchant services through 2022 and into 2023, supported by our continued focus on high growth strategic areas such as SME, online and hospitality.

Network’s investment strategy

Network continues to attract a significant number of key accounts and SME merchants. Major new signings in the first half of 2023 include Talabat and Al Fujairah National Insurance Company.

“The company’s ongoing focus on the SME segment continues to pay off, delivering significant year-on-year growth in SME signings in the UAE, with sign-ups in May accelerating substantially, up 80 per cent YoY,” Network said in a statement.

The payments firm secured eight new customers across acquirer and issuer processing in H1 2023. It also continues to rapidly expand its customer base in Saudi Arabia signing three new banks including Alinma Bank.

Since expanding into the kingdom in 2022, Network has quickly grown its customer base of processing customers to a total of nine.

Earlier in June, Brookfield Asset Management agreed to acquire Network in a deal valued around $2.8bn, as the Canadian investment firm seeks to bolster its presence in the Middle East region’s payments sector.

Brookfield plans to merge Network and Magnati upon the completion of the deal. Network operates through two business divisions – the merchant services segment which provides payment gateways for online merchants and the outsourced payment services division – where the majority of the revenue is delivered through issuer processing.

The company was listed on the London Stock Exchange in 2019.

Read: Canada’s Brookfield acquires Network International for $2.8bn