Travelex interim results and summer trading update

Travelex interim results and summer trading update

26 September 2010

Travelex, the world's leading foreign exchange specialist, today announces strong interim results for the six months ended 30 June 2011 and a positive update on the summer trading period to the end of August.

First half financial highlights

  • Significant uplift in revenue and profit in spite of challenging global trading conditions
  • First half Group revenues up 9% to £356.5m¹
  • First half Group EBITDA up 17% to £49.9m¹

Summer trading update

  • Quarterly revenues and EBITDA for the key summer trading period 1 June 2011 to 31 August 2011 up 6% and 2%, respectively compared to the strong comparable period last year²
  • Strong performances from UK, Continental Europe and US
  • Improved UK performance driven by higher passenger traffic at main airport hubs and a return to growth at regional airports
  • Continental European performance benefited from presence across major international airport hubs, with growth particularly strong in the Czech Republic, Switzerland and Italy
  • Strong recovery in US with a significant increase in sales from online and pre-paid cards
  • Asia Pacific performance strengthened following impact from natural disasters in the first half of the year

 Operating highlights

  • Further expansion of our global footprint, including announced acquisition of Grupo Confidence, Brazil's largest independent foreign exchange provider in May, and acquisition of significant stake in FX Africa, one of South Africa's largest consumer foreign exchange providers, which received SARB approval in August
  • Continued investment in products and services, including the launch of Send Money Now, a UK consumer payments service and improvements across online capabilities, which have driven revenues from online spending up 32% globally
  • Total stores network grows to more than 1,000 globally with 42 new stores and 45 ATMs opened during the period
  • Sale of Travelex Global Business Payments ("TGBP") to Western Union for £606m on track to complete by the end of 2011; sale of prepaid Card Programme Management operations to MasterCard for a consideration of £290m completed in April

Commenting on the results, Peter Jackson, CEO of Travelex, said:

"I am pleased to report another strong set of financial and operating results during an extremely busy period for the Group. In spite of the challenging trading conditions, both our Currency Services and TGBP operations have shown significant growth in profitability, with both businesses benefitting from continuing expansion and investment in products and services. This encouraging performance is testament to the resilience of our business model and the extraordinary efforts of our people in the 24 countries in which we operate.

"This positive momentum has continued since June, with encouraging trading in the key summer period. In particular, trading in the UK and Japan has been very strong. A number of European regions have remained resilient in spite of the impact of the higher Euro on inbound traffic, with Travelex benefitting from a strong foothold in the major European airport hubs. The US market has recovered strongly, although the Asia Pacific market has been impacted by lower inbound passenger traffic, particularly from Japan.

"We opened a further 42 new stores and 45 ATMs in the first half, and recently celebrated our landmark 1,000th store opening at London City Airport. In line with our strategy of focusing on faster growing markets, much of this expansion has been in the APAC region, including Australia, New Zealand, China, Japan, Hong Kong and India.

"In May we announced our entry into Brazil through the acquisition of Grupo Confidence, Brazil's largest independent foreign exchange business. Brazil is a very exciting market with compelling growth prospects. Expanding our geographic reach remains a strategic priority and we have plans to extend our presence into Qatar and Malaysia later this year. The SARB approval granted last month for our acquisition of a significant shareholding in FX Africa also gives us a great platform to build on our presence in this region.

"Increasing numbers of customers are choosing to exchange currency online and we have made significant investments to enhance and extend our online capability, resulting in internet sales growing 32% during the period. The Travelex Cash Passport also continues to show strong growth with sales almost doubling, boosted by the introduction of Chip & PIN. These have also been a popular alternative to credit cards as customers seek to manage their foreign currency requirements in the current environment.

"The sale of TGBP to Western Union, announced in July, was a transformational deal for Travelex and takes us back to our roots with a clear focus on our retail customers. The proceeds from the sale will provide further resources as we look to capitalise on the significant growth opportunities available to us by entering new markets, increasing our availability and investing further in innovative products and services for our customers.

"Looking ahead, the outlook for the remainder of the year is unquestionably challenging, given the volatility in global markets and the continuing economic uncertainty. At the same time, we will be entering a period of tougher comparator financials. The busy summer trading period, however, has been encouraging and we remain on track to deliver full year results in line with the Board's expectations. We will continue to build on the work we have done in order to grow the business and meet the needs of our customers around the world."

1. Group revenue and EBITDA are unaudited and extracted from the management accounts for the six month period ended 30 June 2011

2. Group quarterly revenues and EBITDA are unaudited and extracted from the management accounts for the three month period ended 31 August 2011



About Travelex

Founded in 1976, Travelex has grown to become the world's leading specialist providers of foreign exchange and international payments. Travelex processes £20bn of foreign exchange transactions every year. 

The Group's consumer focused operations provide cash and pre-paid cards to over 30 million retail customers each year through a network of over 1,000 stores and over 500 ATMs spread across 24 countries. TGBP, the group's business focused operations, provide international payments to over 35,000 businesses large and small. Travelex announced the sale of TGBP to Western Union in July 2011 and expect to complete the transaction by the end of 2011.




Dani Filer, Head of Communications
t: +44 (0) 20 7400 4000

Tulchan Communications

Peter Hewer, Susanna Voyle, Tom Murray

t: +44 (0)20 7353 4200


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