Wise shares surge on plans to shift to US listing as FY profits jump

(Sharecast News) - Fintech giant Wise has announced its intention to shift its primary listing from the UK to US, saying the move would help accelerate growth and bring "substantial" strategic benefits to the business and its shareholders. The news came as the cross-border payments firm delivered a 17% increase in underlying pre-tax profits, with revenues rising 15%, and said that medium-term profit margin guidance would be at the top end of expectations.

The announcement was welcomed by the market on Thursday, with shares up 8% at 1,168p by 0827 in London.

According to co-founder and chief executive Kristo Käärmann, benefits of a dual listing include "helping us drive greater awareness of Wise in the US, the biggest market opportunity in the world for our products today, and enabling better access to the world's deepest and most liquid capital market".

Käärmann, who confirmed Wise would maintain a secondary listing on the LSE, said: "The UK is home to some of the best talent in the world in financial services and technology, and we will continue to invest in our presence here to fuel our UK and global growth."

Wise said it served 15.6m active customers during its most recent fiscal year, up 21% over the year before, with personal customers growing 22% and business numbers up 11%.

This growth, along with higher account adoption and interest rates, drove underlying income up 16% to £1.4bn and revenue up to £1.21bn, from £1.05bn previously.

Meanwhile, operational efficiencies to reduce prices for customers enabled a year-on-year reduction in the cross-border take rate of 14 basis points as of the fourth quarter.

Looking ahead, Wise said it would invest around £2bn over the next two years across infrastructure, marketing and products, and has maintained its underlying pre-tax profit margin of 13-16%, down from 21% in the year just gone, as the company "prudently ramp[s] up investments". For the current year, margins should be "around the top of this range".

"We will accelerate our investments to improve the customer experience and to increase our share of the huge c.£32 trillion market opportunity," Käärmann said.

"Powered by our new payments infrastructure that is fundamentally faster, cheaper, and more reliable than the traditional correspondent networks, we're well on our way to handle trillions, not just billions, and become 'the' global network for the world's money."