Asset sales help Travelex swing back into profit

City A.M. Reporter
BRITISH foreign exchange company Travelex, whose bureaux de change are prevalent in many of the world’s leading airports, yesterday said it swung back to a profit in 2011 after netting gains of some £436m from the sale of key businesses.

Travelex, which is majority-owned by private equity company Apax, reported 2011 profits of £377.6m, up from a 2010 loss of £59.6m. Revenues at its ongoing operations rose nine per cent to £586.7m.

Profits were boosted by the sale of its Travelex Global Business Payments (TGBP) division last year to Western Union, as well as the disposal of another business to Mastercard.

The Mastercard sale netted Travelex £290m last April, and TGBP was offloaded for £606m in November.

Although Travelex has sold off non-core assets, the company has also made acquisitions of its own in key fast-growing markets, such as Brazil and Africa.

“Turning to the year ahead, global trading conditions remain unquestionably challenging,” chief executive Peter Jackson said in a statement.

“Despite these challenging trading conditions, I am confident that our strategy, together with our leading brand and talented team of people will generate further growth for our group over the long term,” he added.

The company said that online sales now account for 30 per cent of all sales in the UK, after Travelex saw a 34 per cent increase in web-based orders globally over 2011.

During the year, it added 133 stores to its portfolio, as well as 175 dedicated ATM terminals, increasing ATM transactions by nearly 20 per cent. Travelex also expanded into new destinations, adding locations in Malaysia, acquiring a shareholding in FX Africa, and buying Grupo Confidence – Brazil’s largest provider of foreign exchange services.

Apax Partners has been the majority shareholder in the company since an investment in 2005, which valued Travelex at £1.06bn.