Network International reaffirms earnings and revenue guidance

Network International on Wednesday reaffirmed its annual revenue and earnings guidance as the company reported that it had continued to build on a strong first half performance in its third quarter.

The Middle East and Africa-focused digital commerce specialist said migration of new customers onto its new Network One IT platform is progressing on schedule, with completion set to be achieved before the end of the year.

The FTSE 250-listed company also confirmed a multi-year contract renewal with Orabank, as well as new customer mandates in Africa, notably in Nigeria, where the business has seen the mass adoption of card control services from First Bank of Nigeria Limited.

Network International is now planning the incremental investment needed to enter the Saudi Arabian market, which it said has the potential to be its second largest market, providing significant upside to revenue and earnings guidance.

Meanwhile, after signing a commercial agreement with Mastercard in August, the company is close to finalising an initial set of product and sales initiatives that it will launch with its new partner.

"The board remains confident in the group's growth prospects and ability to capture the very significant opportunities that exist across our markets and we remain on track to deliver low double-digit constant currency organic revenue growth while maintaining stable underlying EBITDA margins for 2019, in line with the guidance shared earlier," said Network International.

Analysts from Liberum commented that the successful progress of customer migration should be noted by investors given the challenges that companies often face with such IT projects, while also highlighting the attractive long-term financial returns the Saudi Arabian market could offer.

"We continue to see the shares as offering an attractive opportunity for long-term investors seeking exposure to a company uniquely placed to benefit from a number of structural growth drivers, providing the group with a number of options to create significant value for shareholders," said analysts.

Network International shares were down by 0.37% at 536.00p at 1027 GMT.