CEO states that RS2 Group’s performance is expected to improve with a ‘stronger pipeline’ in 2024

Radi Abd El Haj, CEO at Malta- headquartered RS2 Group, has noted that business is set to increase with a “stronger pipeline” in 2024, following a series of years filled with macroeconomic challenges.

His comments came in the group’s Annual Report for the financial year ended 31st December 2023, released on Tuesday. RS2, formerly RS2 Software, is a leading provider of omni and multichannel payment software and end-to-end payment solutions for both issuers and acquirers on a single payment platform for banks, large financial institutions, integrated software vendors, and other entities.

The report highlighted that during 2023, RS2 Group generated €39.7 million in revenue, 5.7 per cent more than it did in 2022 (€37.5 million). The majority of the revenue (62.8 per cent) was generated through the provision of processing solutions. Additionally, cost of sales and administrative expenses both decreased marginally, amounting to €24.9 million and €10.3 million, respectively. The group also reported an exchange rate loss on operating activities of €586,363 in 2023, a sharp drop from the €1.5 million gains it had made in this regard in 2022. As a result, pre-tax profit for 2023 totalled €1.4 million, 19.1 per cent less than the €1.8 million that was registered in 2022.

As at the end of 2023, the group’s total assets amounted to €49.4 million (2022: €43.4 million), while its current assets exceeded its current liabilities by €41,111. The Board of Directors did not recommend the payment of a final dividend for the year, stating that its growth strategy “requires further investment in infrastructure and business development.”

In his statement in the Annual Report, Mr El Haj noted that after a series of “demanding years” that were marked by exceptional market circumstances, RS2 Group closed 2023 “on a positive trajectory.”

He noted that milestones such as securing a major processing outsourcing agreement with one of the largest acquirers in the US “highlight RS2’s resilience and effective long-term planning, made achievable through the commitment of a dedicated global team, management, and Board of Directors.”

The past few years have been characterised by a global economic slowdown brought by the effects of the COVID-19 pandemic and the Russian invasion of Ukraine, prompting a period of slow growth and heightened inflation. However, while in previous years customers opted to postpone projects or minimise investments, Mr El Haj said that RS2 is witnessing a “notable increase in client inquiries and demands, indicating a positive shift in the business landscape.”

Mr El Haj noted that RS2 and its subsidiaries have continued to broaden their business across regions and lines of operation throughout 2023, “evolving from licencing to processing, and now also to acquiring business in Europe.”

He added that the group has made “strong progress” and executed its key strategic priorities at a “steady pace,” which will in turn help the group strongly position itself to increase the pace of its growth in 2024 and beyond.

RS2 Group is seeking to add more enterprise clients, such as tier one banks and financial institutions, to its managed services business. It also aims to increase the issuing processing business in markets where acquiring services are already provided. Additionally, the group is also planning to make further investments in infrastructure to strengthen its technology and complete the product offering to “play a more active role in the digitalisation of the whole customer journey,” Mr El Haj said.

“The payments industry is constantly evolving and 2023 is shaping up to be a year of significant innovation and change with focus on making payments more convenient, secure, and personalised for consumers,” he continued.

Mr El Haj said that business is expected to “ramp up with a stronger pipeline, gearing up for the coming year,” which together with the launch of a number of new products for RS2 Group, will result in a “successful 2024 and beyond.”

He also proceeded to thank RS2 Group’s global team, management, the Board of Directors, and shareholders for their support.