• Total Revenue: EUR2.9 billion, growth of more than 12%.
• EBITDA: EUR1,265 million, like-for-like growth of 19%.
• EBITDA Margin: Increased by 130 basis points to 44.3%.
• EPS: EUR2.07, increase of 21% reported for 2024.
• Free Cash Flow: EUR881 million, with a conversion ratio of 70%.
• Net Debt: Leverage ratio of 1.4 times.
• Operating Revenue Growth: 11.4% growth, with Europe at 10%, Latin America at 15%, and Rest of the World at 20% like-for-like.
• Other Revenue: EUR247 million, growth of 26.2% like-for-like.
• Funds from Operation: Up 19.2%.
• Shareholder Return: EUR664 million, including dividends and share buyback.
• Dividend Proposal: EUR1.21 per share, up 10% from last year.

• Warning! GuruFocus has detected 5 Warning Signs with EDNMY.

Release Date: February 18, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Edenred SE (EDNMY) delivered a strong financial performance in 2024, with total revenue reaching almost EUR2.9 billion, marking a growth of more than 12%.
• The company exceeded its 2024 guidance with a like-for-like EBITDA growth of 19%, surpassing the initial 12% target.
• Edenred SE (EDNMY) increased its shareholder return significantly, reaching a total of EUR664 million through dividends and share buybacks.
• The company is well-positioned for further profitable growth in 2025, despite uncertain European economic conditions, with a target of more than 10% like-for-like EBITDA growth.
• Edenred SE (EDNMY) made significant progress in ESG performance, being recognized by leading ESG ratings and joining the Dow Jones Sustainability World Index.

Negative Points

• Edenred SE (EDNMY) faces economic uncertainty in Europe, which could impact its growth trajectory in 2025.
• The company anticipates a EUR60 million EBITDA impact in Italy due to regulatory changes, posing a challenge for 2025.
• Interest rates are expected to decrease, potentially leading to a EUR30 million reduction in other revenue and EBITDA.
• The company experienced slower growth in Q4 2024, with some business lines, such as complementary solutions, remaining flat.
• Edenred SE (EDNMY) is undergoing a portfolio review, which may lead to exits from certain underperforming segments, potentially impacting revenue.

Q & A Highlights

Q: How many one-off factors from Q4 2024 will persist into 2025, and what is the outlook for Brazil regulation? A: The Belgian consumption voucher and CESU impacts are not expected to affect 2025. EBV Finance is expected to rebound, and the exit from some banking as a service clients will impact H1 2025. Regarding Brazil, discussions on portability and interoperability continue, but no immediate regulatory changes are expected.

Q: Can you provide more detail on the growth expectations for the "beyond food" category and the impact of Italy's revenue changes? A: Wellness and engagement benefits are expected to drive growth in the "beyond food" category. The EUR60 million EBITDA impact from Italy is factored into the 2025 outlook, with operating revenue growth expected to be high single-digit, considering the Italian impact.

Q: What is the expected impact of the portfolio review on PayTech and the cost structure? A: The PayTech portfolio review is focused on growth, not cost-cutting. Some client exits will impact revenue slightly. The cost base will grow in 2025, but at a slower rate than in previous years, with some efficiency measures in place.

Q: How will the 2025 financial performance be phased, considering the strong H1 2024 comparisons? A: H1 2025 will face tough comparisons due to strong growth in H1 2024. However, the full year is expected to achieve 10% EBITDA like-for-like growth, supported by revenue growth and cost management.

Q: Can you provide more details on the Reward Gateway rollout and its impact on growth and profitability? A: Reward Gateway achieved double-digit growth in both revenue and EBITDA in 2024. The rollout in new markets is progressing well, with cost synergies realized, making it accretive to the overall business.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.