Worldline CEO exits as payments group issues another profit warning

By Alban Kacher

(Reuters) -French payments group Worldline announced on Friday the departure of its long-time CEO Gilles Grapinet as it issued its third profit warning within a year, sending its shares sharply lower.

The shares were down 17% by 0833 GMT, after hitting a record low earlier in the session and extending their year-to-date decline to 55%.

Worldline said that Deputy CEO Marc-Henri Desportes will act as chief executive as of Sept. 30 for an interim period. Grapinet had been the group's CEO for more than 11 years.

The decision comes from Worldline's board of directors, spokesperson Helene Carlander said, adding it was aimed at preparing "a new strategic step for the company".

"The CEO change was motivated by the third profit warning within a year with many investors calling for management change," Jefferies analyst Hannes Leitner said, adding that investors expected the new CEO to "ignite organic growth".

Last December activist investor Bluebell urged the fintech company to shake up its board to "restore trust" amid rumours of a potential hostile takeover bid for the group.

Bluebell was not immediately available for comment.

Worldline said it now expects organic revenue growth of about 1% for 2024, against a previous forecast of 2-3%. It sees adjusted earnings before interest, tax and depreciation (EBITDA) around 1.1 billion euros ($1.2 billion), down from 1.13 billion-1.17 billion previously.

The group, which earns a fee for processing digital payments for clients ranging from businesses to government agencies, also postponed its capital markets day, initially planned on Nov. 26.

COST SAVINGS

Worldline said it saw weaker summer trading and "specific performance issues" in its Pacific business and other markets. It declined to give details when asked by Reuters.

The group said it would launch further cost saving measures.

Worldline previously cut its full-year guidance in August, citing a sharp decline in domestic consumption trends across Europe and uncertainty about a potential recovery.

The company benefited during the pandemic when investors piled into European payments companies, attracted by their rapid growth as customers ditched cash and by consolidation in the industry.

But the group's shares lost more than half their value in October last year after it cut its full-year financial targets, sending shockwaves across the sector.

($1 = 0.9024 euros)

(Reporting by Alban Kacher; Editing by Sherry Jacob-Phillips, Mark Potter and Susan Fenton)