Digital transactions technology company eServGlobal updated the market on its joint venture with Mastercard and BICS, HomeSend, on Tuesday, and issued an update on its current trading within its core digital financial transactions business.
The AIM-traded company said HomeSend was showing "strong momentum" in its expanded focus on the banking market, with further agreements expected.
Mastercard, through Mastercard Send and HomeSend, was said to be offering a solution to the challenges experienced by banks in cross-border payments.
The recent announcement of 10 bank agreements over the last 12 months reinforced HomeSend's "strong position" to expand in the bank market, eServGlobal's board explained.
Advanced discussions, including implementation discussions, were in progress with a number of large banks, the board confirmed.
It added that it understood precise planning of short and medium-term volume expansion was difficult to predict, but said it remained "satisfied" that the momentum of existing and imminently-expected agreements supported the required financial growth of HomeSend over the next few years.
In its core business, eServGlobal said it expected to "finally achieve" operational EBITDA breakeven in the quarter to December, however it would not be able to recognise enough revenue to recover from the "disappointing" first half of the year.
As a result, the board said it was expecting a lower revenue range for the 14-month year than previously advised, in the range of 9.7 to 11.0m.
However, it did note that orders in the year were expected to be in the range of 11.0m to 15.0m, which would build a "positive momentum" of backlog and works in progress going into 2018, against a "significantly reduced" cost base over previous years.
During the year, eSG said it has "thoroughly reviewed" its market and commercial model.
"We have been very pleased with the level of interest in our next generation mobile financial services recharge platform provided within Paymobile 3," the board said in its statement.
"This recharge capability has been the cornerstone of our business for the last 10 years and continues to represent a significant part of our value to existing customers."
The core business was already addressing a "final right size", the board explained, having previously driven out much complexity and "poor" commercial arrangements.
It was forecasting an operational EBITDA breakeven result for the December 2017 quarter, and was planning to enter the 2018 financial year with a break even point of 12m in annual revenues.
That would be covered by an expected 2m of deferred revenue from 2017, an expected 5m of recurring revenue from existing customers and a targeted 5m of changes and upgrades from those existing customers.
The board said it would look to "maximise" the value of the core business in the medium term, as it proved itself as a self-sustaining standalone business.
"This is the most exciting period in my time with eServGlobal," said executive chairman John Conoley.
"It would be an understatement to say that our investors have been patient, particularly with the core business."
Conoley said he was "delighted" that the company was "on the verge" of delivering a satisfactory and capable core business.
"We believe that following completion of cost reduction plans, the core business will be self-sustaining next year on a stand-alone basis.
"This will be following an expected operational EBITDA breakeven in the last quarter of 2017."
At the same time, Conoley said HomeSend was beginning to realise the expectations that eServGlobal and its investors had placed in it.
"It has a colossal market to go for and its traction in that market is building rapidly."