CAB Payments shares sank over 70% on Tuesday after it lowered full-year revenue forecast, saying volatile African currencies were hurting volumes and margins. Trading in the share was halted.
The losses, if they hold, are set to wipe off three-fourths of British money transfer group’s market value, which stood at 851 million pounds in its July debut.
CAB said changes in market conditions of key currency corridors, mostly Nigeria’s naira, Central African Franc and West African Franc are compressing margins and reducing trading volumes.
The company, which specialises in business-to-business emerging markets cross-border payments and foreign exchange, now expects 2023 group revenue 17% below its previously issued guidance.
CAB added that the “majority of any revenue impact will flow through to the bottom line.”
“With FY23 guidance very explicitly proffered, we expect income to decline by ~17%,” JPMorgan analysts said in a note.
Shares of the company, backed by private equity firm Helios Investment Partners, were trading at 65p in London, far below their IPO price of 335p. Trading was halted midmorning.
CAB Payments’ public listing was hailed by London bourse as recognition of the British capital as a “vibrant market” for financial technology firms, many of which in recent years have hinted at moving to New York in search of higher valuations.
Reuters
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