Worldline's Q1 Revenue Drops Sharply on Difficult Comps but Trend Reversal in Sight

We maintain our EUR 84 per-share fair value estimate for Worldline after the payment services provider published first-quarter revenue figures. The top line declined 9% on an organic basis, driven primarily by its merchant services and terminals business, although all segments were down this quarter. While this performance is not pretty, it was well within our expectations. Given the continued, and in some of Worldline’s operating regions intensifying, coronavirus lockdowns; a revenue decline versus the largely unaffected first-quarter 2020 was to be expected. On the flip side of the coin, the combination of vaccine rollouts and a much lower comparable base for the second quarter should result in significantly stronger growth figures in future. Looking past these multiple moving parts, we think mid-single-digit revenue growth and a 2% operating margin improvement are achievable for the full year. We maintain our narrow moat and stable trend ratings.