DR. MARKUS BRAUN
CEO, CTO
T O O U R S H A R E H O L D E R S L E T T E R F R O M T H E C E O
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Letter from the CEO
Dear ladies and gentlemen,
Dear shareholders,
Wirecard AG was able to report a successful 2014 fiscal year. Transaction volumes processed
through the Wirecard platform grew by 28.5 percent to EUR 34.3 billion. Asia contributed
EUR 7.4 billion, which represented a share of 21.6 percent of the total volume.
Consolidated revenue grew 24.8 percent year on year to reach EUR 601 million. Earnings before
interest, tax, depreciation and amortisation (EBITDA) increased by 37.3 percent to
EUR 172.9 million.
Development in 2014 In the 2014 fiscal year, Wirecard Group exceeded its growth targets in its core e-commerce
business. The key factors, alongside market growth, were the resulting increase in processing
volumes from existing customers, our sales success with new customers, the strategic expan-
sion and innovations in the area of mobile payment business and the associated value added
services.
Today, Wirecard is one of the world’s leading technology companies for electronic payment
transactions. Our solutions provide customers with the opportunity to reduce costs and add
value by enabling them to outsource the growing complexity of payment processing to a
service-provider. We offer retailers payment processing based on Internet technologies for all
sales channels, whether online, mobile or point-of-sale (POS).
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In 2014, Wirecard achieved further progress in the development of its core business for innova-
tive payments, risk management and payment acceptance. In its area of payment acceptance
solutions, the Company continuously expanded its existing solutions to include payment
methods, local acquiring options and integration measures relating to retailer back-office
automation. Our risk management solution, the Trust Evaluation Suite, combines intelligent risk
management with payment processing and a record of the order and payment history between
the retailer and their customers.
In light of the increasing internationalisation of the market and the complexity of our business,
cooperation partners form an important component of our success. For example, we have also
been working for the last year with an American supplier of digital enterprise e-commerce
solutions for retailers that specialise in the fashion industry. In the payment area, we are
cooperation partners in the world's leading reservation system for the airline industry and travel
sector.
The issuing of standardised co-branded card products and prepaid voucher card products
makes the Wirecard Group one of the leading card issuers in Europe. In the mobile payment
business area, we are an active driver of product development with card products for Visa and
MasterCard that are saved on mobile devices in digital form.
In Asia, we were able to report a very encouraging performance in our operating business.
A good example here is our Indonesian subsidiary PT Prima Vista Solusi, which has taken over
responsibility for the payment infrastructure and the connections to financial institutions for the
local public transport system in Jakarta, TransJakarta Busway. Services provided by the
Wirecard Group already support contactless payment in local public transport systems in
London, Singapore and Jakarta.
T O O U R S H A R E H O L D E R S L E T T E R F R O M T H E C E O
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Developments in the mobile payment business area In the past year, Near Field Communication (NFC) established itself as the standard for mobile
payment at the POS. The projects that Wirecard has been implementing with leading telecom-
munication services in a variety of European countries since 2012 were gradually rolled out in
Spain, Germany, the Netherlands and England as a soft launch in 2014. A gradual increase in
marketing activities is expected this year because the prerequisites for mobile payments are
being continuously improved. Cash terminals in the retail sector will be progressively upgraded
for contactless payment in many European countries as Visa and MasterCard are increasing the
pressure on network operators and retailers.
Another impulse for the growth of NFC-based mobile payment transactions is the increasing
availability of practical application scenarios for consumers. Customers using the Vodafone
SmartPass have had the opportunity since September to make contactless payments with their
smartphones for all modes of public transport offered by the British umbrella organisation
Transport for London (TfL). At the same time, the Vodafone SmartPass allows passengers to
pass through ticket barriers, which is a significant advantage for users.
Numerous products – whether mobile wallets, the mobile POS solution card reader or mobile
payment applications – are already deployed through our partners on various markets – in
Europe or Asia, for example in India and Vietnam. We are shaping the market with our
innovations in the mobile payment business area as a key company for technology services and
as a card-issuing financial institution.
Host card emulation (HCE) technology is another development in the field of mobile payment
based on NFC. Visa and MasterCard have certified the secure integration of HCE, with which
transactions can be transferred via so-called tokens in a similar way to conventional EMV card
transactions. HCE is thus hardware-independent and cheaper as a result. Therefore, this
technology enables telecommunications companies, financial service providers, banks or even
retailers to quickly access the mobile payment market on the basis of NFC. In this area,
Wirecard can offer all of the components as a co-branded solution or in combination with its
own brand boon, which we are launching on the market in the summer of 2015, as a partner
project. NFC has, for the time being, established itself as the technological standard. All
significant market participants from card companies through to retailers are following this path.
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Geographic expansion We continued our geographical expansion with four acquisitions in 2014. 3pay, based in Istanbul,
will enable us to roll out our core business on the Turkish market. As a result of the acquisition
of Amara Technology in South Africa and its existing customer portfolio in the banking sector,
we will also be able to address financial service providers in the neighbouring region with
processing and mobile payment solutions. The GFG Group, based in New Zealand, not only has
customers in the Asia-Pacific region but also globally with partly in Africa and in South America.
The company has also developed an interesting mobile payment feature that we can offer in our
growth markets in combination with existing technology. In the meantime, the transaction and
cooperation agreement with Visa Processing Service in Singapore has also now been
contractually concluded. As a result, we are strengthening our partnership with Visa and thus
our cooperation with banks in the area of issuing processing.
Outlook Our increasingly global orientation in the core e-commerce business will serve as the main basis
for the dynamic development of the Wirecard Group over the next few years. Internet
technologies are encroaching more and more into all areas of our lives. In terms of our business,
it can be expected that this will push forward the convergence of POS and online business. We
are keeping abreast of this development with our strategy of also rolling out products and
services to end customers via leading distribution partners who have access to the B2C market.
The Wirecard Group is also focusing on applications in the areas of mobile payment acceptance,
mobile money transfer and the technological provision of loyalty and couponing programmes
that are completely integrated into mobile payment processes. These value added services are
an integral component for retailers when launching and managing campaigns and customer
loyalty activities. Our technological expertise is being combined with various services to form a
unique complete package – from card and payment processing through card management to
issuing licensing.
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We will globally expand our core business – the processing of payments based on Internet
technologies through our Multi-Channel Payment Gateway. According to our planning, it will
also grow faster than the market in the current fiscal year.
Despite strong organic growth, the Management Board remains committed to its strategy of
increasing the presence of the Group in growth markets though acquisitions. Acquisitions
outside of the Asia-Pacific region, such as in South America, are also of interest.
The e-commerce market continues to offer considerable potential for growth.
Wirecard AG’s Management Board is optimistic about the business performance and expects
operating earnings before interest, tax, depreciation and amortisation (EBITDA) of between
EUR 210 million and EUR 230 million in the 2015 fiscal year. This growth forecast is based on
the market growth of online transactions in Europe, the dynamic development of our business in
the Asia-Pacific region and Africa, our activities in the area of mobile services, as well as by our
ability to tap into new business areas.
My colleagues on the Management Board and I would like to thank all of our employees! The
now globally distributed team has once again managed to continue Wirecard’s success story
due to their tireless dedication and industriousness. We would also like to thank our customers,
shareholders and partners for their loyalty, trust and excellent cooperation.
To reflect our continued dynamic growth, we will propose to the Annual General Meeting the
approval of a dividend of EUR 0.13 per share this year.
Yours sincerely,
Dr. Markus Braun
CEO of Wirecard AG
BURKHARD LEY
CFO
JAN MARSALEK
COO
WULF MATTHIAS
Chairman of the Supervisory Board