Sale of Goodbody stake to AIB helped Fexco return to profit in 2021

Irish financial services group Fexco posted a €1.2 million operating profit before exceptional items in 2021 after plunging to a net loss of nearly €48 million in 2020, driven by the pandemic.

In an update on Monday, the Killorglin, Co Kerry-based technology and business services outfit said group income topped €102 million in its 2021 financial year, roughly 60 per cent of its pre-pandemic income for 2019.

Fexco said that its disposal of a number of assets in 2021 contributed €54 million to its balance sheet.

Fexco enhanced its financial position in the financial year by disposing of its 51 per cent share in Goodbody Stockbrokers to AIB for €70 million. It also received €30 million from the sale of its share in fintech Taxamo, which was acquired by US tax-compliance software and services company Vertex.

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The group, founded four decades ago by Brian McCarthy, was forced to restructure in 2021 after revenues from its foreign exchange and payment services businesses slid during the Covid-19 crisis and two subsidiaries fell into administration.

Fexco reported a €59 million net profit before exceptional items for last year.

Neil Hosty, Fexco Group chief executive, said the pandemic continued to have an impact on foreign exchange revenues in 2021.

However, he said the group was “very happy” with the performance, which reflects “the resilience of our business”.

Mr Hosty said Fexco’s payments and foreign exchange businesses grew their customer base in 2021, “base positioning them for growth as transaction volumes returned close to pre-pandemic levels by the second half of 2022″.

In a trading update for 2022, Fexco hailed the recovery in global travel, which boosted its retail foreign exchange and payments revenues in the second half of the year. The division also “invested in growth in the US, Latin America and Asian markets, which delivered “significant growth” in the second half of the year, it said.

Separately, the group launched a new platform this year that analyses carbon emissions in the aviation sector, enabling airlines and investors in the sector to manage their emissions in line with Net Zero targets.

Fexco has also hired some 200 people in the last 12 months, the group said on Monday.

“As global travel recovered in the second quarter of 2022, our travel related businesses have returned strong volumes and profitability,” Mr Hosty said. “Our continued investment in organic growth and innovation has served us well across our divisions who are all delivering strong performance.”