Seven reasons to invest in the Edenred Group
Leading digital platform for services and payment and the everyday companion for people at work.
1. Position as a global leader in relatively untapped markets with excellent development prospects
Edenred is a leading digital platform for services and payments and the everyday companion for people at work, connecting more than 52 million users and 2 million partner merchants in 45 countries via close to 1 million corporate clients.
Edenred offers specific-purpose payment solutions for food (such as meal benefits), incentives (such as gift cards, employee engagement platforms), mobility (such as multi-energy, maintenance, toll, parking and commuter solutions) and corporate payments (such as virtual cards).
True to the Group’s purpose, “Enrich connections. For good.”, these solutions enhance users’ well-being and purchasing power. They improve companies’ attractiveness and efficiency, and vitalize the employment market and the local economy. They also foster access to healthier food, more environmentally friendly products and softer mobility.
Thanks to its agile, innovative approach, leading-edge technological expertise and close contact with each local ecosystem, Edenred seizes opportunities for development in all countries and all of its business lines. These offer significant potential, as the Group operates in underpenetrated markets and benefits from favorable demographic and social fundamentals, such as the formalization of the economy and increasing numbers of people in work worldwide; the impact of digitalization on the way we work, consume and interact; changes to urbanization and the way we relate to distance, which are generating more mobility needs and new ways of getting around; and lastly, global awareness of the climate emergency, which has led society to question the industrialization of farming and food production.
To connect the fast-changing world of work, Edenred monitors and analyzes economic, social and environmental trends everywhere it operates so that it can develop the required solutions.
2. A strategy of sustainable and profitable growth
The strategic plan Beyond22-25 launches a new phase of profitable and sustainable growth. It leverages the unique nature of the Edenred platform to provide people in the world of work with the full range of services and payment solutions they need to make their working lives easier.
Edenred harnesses a virtuous business model, combining a low user acquisition cost with high levels of user adoption and retention. Operating exclusively in the working world and serving specific purposes, the Group is able to screen transactions and earmark funds for selected merchants, who appreciate the extra revenue that Edenred sends their way.
Edenred operates in markets that are still largely underpenetrated and that therefore harbor considerable growth opportunities, reinforced by widespread adoption of new behaviors. Against this backdrop, the Group intends to leverage to the full its unique global platform advantage by developing a common approach in each of its business lines based on three priorities:
- Scale the Core – grow further in its existing markets, which are still largely underpenetrated, notably by capitalizing on a segmented go-to-market strategy, cross-selling and up-selling in its client portfolio, and increasing user monetization.
- Extend Beyond – accelerate the Beyond Food, Beyond Fuel and Beyond Payment strategies by launching and deploying more value-added services for its clients, partner merchants and users.
- Expand in New Businesses – expand into promising new geographies, such as the United States, the world’s largest economy.
Reaffirming Next Frontier strategic plan targets for 2023
|Annual EBITDA Growth||> +12%|
|Annual FCF/EBITDA Conversion Rate (1)||> 70%|
1At constant regulation and methodologies
3. A business model generating strong cash flows
Edenred’s business model is underpinned by a profitable and sustainable growth profile with significant operating leverage. Its operations are not capital-intensive and generate substantial cash flows.
What makes the model unique is that the majority of the solutions developed by Edenred are prepaid, which leads to a structurally negative working capital requirement.
Edenred leveraged its strongly cash generative business model to deliver record-high funds from operations before other income and expenses (FFO) of €673 million in 2022, up 21% as reported.
Free cash flow was a record €881 million in 2022, lifted by the increase in the float – notably due to the good fourth-quarter performance – and by the positive impact of regulatory changes affecting the Ticket City product in Germany, for which the related cash was considered as restricted until January 1, 2022. Excluding the one-off impact of this change in regulations, free cash flow would have amounted to €711 million for 2022, compared with €518 million for 2021, with a free cash flow/EBITDA conversion rate of 85% versus 77% in the previous year.
4. Considerable technological expertise and strong innovation capacity in payments
Continuously striving to improve user experience, Edenred has developed a leading-edge technology platform for payments. Thanks to this B2B2C platform, the Group managed some €38 billion in business volume in 2022, thanks to transactions carried out primarily via mobile applications, online platforms and cards.
Edenred’s technological expertise is a major competitive advantage, giving it an unparalleled capacity for innovation in its markets and a high level of agility in terms of deployment processes for value-added services, while keeping transactions totally secure.
5. A generous shareholder value policy based on a solid financial position
Edenred proposed a dividend of €1.00 per share for 2022, representing a 11% increase compared with the prior year.
It is consistent with its growth profile, solid financial position and strong cash generation.
The dividend was approved by shareholders at Edenred’s Combined General Meeting on May 11, 2023.
6. 10,000 employees driving forward a Group committed to society
Edenred’s 10,000 employees are committed to making the world of work a connected ecosystem that is safer, more efficient and more responsible every day.
The solutions they imagine, develop and propose to corporate clients have a positive impact on their 52 million end users and promote more environmentally responsible practices, every day and over the long term. Edenred’s programs notably encourage employees to eat a balanced diet and opt for eco-friendly modes of transportation for their daily commute.
These positive impacts on society reflect the objectives set out in the Group’s corporate social responsibility (CSR) policy, “Ideal”: improve the lives of individuals, protect the planet and create value responsibly. Edenred’s employees are ambassadors for its ambitions.
7. A responsible governance structure that creates value
Edenred’s governance bodies guarantee the relevance and compliance of all decisions made by the Group and actions carried out as part of its strategy.
The Board of Directors comprises 12 members and has three committees to assist it with its decisions and to ensure Edenred’s responsible development.
The 10-member Executive Committee brings together operational representatives from the Group's main business lines, as well as functional managers who provide expertise to support operations.
The Board of Directors strives to ensure that its membership and that of its committees is balanced in terms of independence, experience, skills, professional expertise, international exposure, age and gender.
Experience, skills and professional expertise are fundamental criteria in the selection of directors, particularly in the fields of B2B2C relationships, digital technology, international experience, finance and corporate social responsibility (CSR).
The profiles of the directors selected must be complementary, so that the combination of their individual skills and expertise covers all of the Group’s operations.
In order to support the Group’s international dimension, the Board of Directors ensures that it includes international profiles (nationality, experience). As of December 31, 2022, the Board of Directors included two Italian citizens, two Spanish citizens, one Brazilian citizen and eight members with extensive international experience.
Moreover, all directors appointed by the General Meeting (excluding the Chairman and Chief Executive Officer) are members of at least one committee of the Board of Directors.
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