Worldline (WLN) Investor Update summary

Compliance and risk management actions

• Enhanced compliance standards and a full review of high burn risk (HBR) merchant portfolios have been implemented since 2023, with rigorous offboarding of non-compliant merchants under regulatory oversight, especially in Germany.

• HBR merchants now represent 1.5% of acquiring volumes after significant offboarding, with ongoing due diligence and remediation for the remaining marginal portfolio.

• Strengthened risk supervision includes increased resources, robust onboarding, ongoing monitoring, and harmonized frameworks for sensitive clients, with immediate action on signs of non-compliance.

• The board and its committees are actively involved in remediation, audits, and compliance enhancements, aiming for industry-leading standards.

• The CEO is committed to a no-tolerance approach for deviations and closely monitors progress.

Financial and operational impact

• Offboarding of HBR merchants is expected to impact revenue by approximately EUR 130 million in 2024, with confirmation of figures due at the end of July.

• HBR merchant fees are higher, typically 2-3% of transaction value, representing a premium over standard merchant fees.

• The orchestration business, mainly serving gaming and gambling sectors, contributes EUR 40-45 million to EBITDA, with about half of its volume regulated as gambling.

• The orchestration business is being reviewed for compliance, though it is not within the regulatory scope, and any remediation will remain within the previously disclosed financial impact.

Regulatory and stakeholder engagement

• No issues have arisen with major card schemes (Visa, Mastercard) regarding compliance, and current chargeback rates are below industry thresholds.

• Regular audits are conducted by regulators in all jurisdictions, with ongoing and upcoming audits considered part of normal business.

• There is no knowledge of litigation or claims related to recent media allegations, and any future legal action will be addressed transparently.

• The company is considering legal action against media outlets for reputational damage caused by recent reports.