Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Nexi Full Year 2020 Preliminary Results conference call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, then they signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Paolo Bertoluzzo, CEO of Nexi. Please go ahead, sir.
Good afternoon or good morning for those of you connecting from the U.S. This is Paolo. It's very nice to find you again in the new year. Welcome to our full year results, preliminary results call for 2020. As usual, I'm here with Bernardo Mingrone, our CFO, and Stefania Mantegazza, who's leading Investor Relations, and a few other members of our team. As we've done in the recent past, we will be covering our results. But before I do that, we will also give you an update on what we see happening on the back of the evolution of the COVID-19 pandemic. And obviously, at the end of the presentation, we'll have time, as usual, for your questions.
Now, before we jump into the details of the content, and so on and so forth, let me start with page three, where we try to basically, you know, highlight the three key messages that we believe are important from today's session. The first message has to do with our 2020 performance. We believe we had a strong overall performance despite COVID, and I would add, despite the second wave of COVID. This performance is also better than the anticipated ambition that I want to remember for everybody that was given in July, so before we could even foresee the second wave of the pandemic, and despite that, we have done a bit better than what we had communicated as our ambition for 2020.
EBITDA closed up 2.5% at EUR 601 million. EBITDA minus CapEx closed at 466, up double digit, plus 11.2%. Revenues were at EUR 1,044 million, minus 2.8% in the year, with a positive Q3 and a basically flat Q4 over last year, minus 0.7%. Overall, we had a very resilient operating performance with a good traction despite COVID on our key propositions. The second key message is that, you know, despite, you know, the complexity of managing the COVID situation, and obviously the pressure on volumes and therefore on top line, we continue to see visible signals of possible digital payments acceleration.
This is very clear when we observe customer habits, changes towards digital payments throughout the pandemic, and we try to highlight a couple of factoids here. We see at the same time, and this is probably even more important from a strategic point of view, a growing interest from merchants and consumers for more advanced digital and omni-channel solutions, and we'll comment on this, and finally, now, we've seen good traction on government cashless initiatives, in particular on cashback that was started in a Christmas version at some point at the beginning of December, and will continue for 2021 and probably 2022. Third key message, as you well know, in the latter part of the year, we have accelerated our transformation from an Italian PayTech leader into a European PayTech leader.
At the beginning of the year, we have basically closed the acquisition, completed the acquisition of the Intesa merchant book, and integration is executed since Q3, and our activities right now are well integrated and progressing well with the new partner. Second, as you know, we signed the Nexi Nets merger agreement, and we have already filed with European Antitrust to move as fast as possible towards closing. Over the last few hours, we have also signed the Nexi SIA merger, and we are overall on plan, on track with our overall plan. If you bring all of this together, we actually see a very positive outlook in the coming years. Clearly, twenty twenty-one performance will continue to depend in a very relevant way on the dynamics from COVID.
We will comment our outlook for the new year at the end of the presentation, but it's very clear that there is a positive mid-long term outlook as society and economy gradually recover from COVID-19. Now, let me jump into a more detailed summary of today's session, page 4, and let me start with the COVID-19 update. Transaction volumes for the year, is a combination of, acquiring and issuing, were down 11% versus 2019. In the last quarter, they were down -8.6% due to the effect of the second wave of COVID. The second wave of COVID, however, did have a much more limited impact versus the first wave of COVID. To cut a long story short, while the first wave of COVID was at around -50% impact on overall volume.
This second wave has seen a peak around minus 20% on volumes, thanks to the fact that compared to the first wave, the measures that have been implemented by the government in Italy did have two qualities compared to the first one. Obviously, they were much better planned, given the fact that the first wave came as absolutely a new thing. First of all, they were more selective in nature. For example, industrial production, business to business, these were open, and also the broader retail activities were only selectively closed. And second, the government took an approach that was a region-by-region segmented approach based on the local situation with COVID.
However, now from basically mid-January, we see a rapid volume recovery, quite similar to the one that we've seen in May, June, July, at the back of the first wave, now after the easing of the restriction, and we see a continued double-digit growth in basic consumption, a very fast recovery in discretionary spending. If you strip out the foreign cards, the cards that are used by inbound tourists, inbound visitors, that obviously remain very weak, and you focus on the Italian cards only. Italian cards only are actually already back into visible growth overall, and even more so if you just look at basic consumption and discretionary consumptions. Basically, over the last few days and week, now we've seen as a total volume dynamic that is marginally negative, minus 2% year over year already.
We saw throughout the year a strong e-commerce acceleration, net off, obviously, of the tourism and travel-related sectors. We've seen basically this acceleration fluctuating around 35%, 37%, 40%. It was actually 42% in the last quarter. Overall, e-commerce performance was overall, including travel-related sectors, less impacted than physical commerce. The total for the year was -2%. And finally, as I said before, we continue to see signals of acceleration from cash to digital transactions, and we're seeing a good traction for government cashless initiatives, especially on cashback.
We can comment more on Q&A, anticipate that we will not be providing detailed data on customer behaviors, not because we don't observe them, as you can imagine, we observe them with a lot of rigor, but because they're still unstable, and we really don't want to misguide the market on data that are not yet reliable. As you probably read in the media, the cashback initiative did have an overall very good traction. We basically had about 10% of Italian cards that did sign up into this initiative in December, beginning of January, continues to see this interest growing. The government has launched only a couple of weeks ago a new initiative that was planned already, that is the lottery initiative.
This is a bit more complex in terms of customer experience, will probably take a bit more time in terms of gaining traction, but in general, we see a very high level of interest from, consumers and from merchants on these initiatives, and, I would say nice changes of behaviors and good elasticity. Now, coming to our results on page 5, as I've anticipated, EBITDA was up 2.5% for the year, and was actually up 8.3% in the quarter, in the last quarter. EBITDA minus CapEx overall was up double digit, +11.2%. Revenues were down -2.8%, in the full year, and, basically flat year over year.
We will comment the business updates of the three business units later on, so let me jump over it. We had a strong performance on costs that obviously has supported the growth of EBITDA, despite COVID. Costs were down 9% year over year, basically due to our continued effort on efficiency and the 100 million-plus cash cost containment plan that we did overachieve. And last but not least, when it comes to our financial results, the net financial debt to EBITDA multiple was down at 3.5 times, which is really remarkable if you net from these numbers, the effect of the acquisition of the Intesa book, EUR 1 billion that we funded with debt.
Actually, our leverage would be already at 2.5 times EBITDA. Only in April 2018, when we did to take the company public and we were at around 3.5, we said very clearly that we were seeing a long-term target for our leverage at 2 to 2.5 times EBITDA. We are already at 2.5, despite if you strip out the Intesa book investment that you are all aware of. Now, let me also just give you an update on where we are on the SIA transaction. As I said, we are progressing as planned. We've basically signed this morning the binding documentation on the SIA transaction.
As far as the next transaction is concerned, we have filed already the cross-border merger plan with the European Antitrust. We continue to see closing happening in second quarter this year for Nets, and in third quarter this year for SIA. Let me also give you the highlights of the results that SIA and Nets have published over the last few hours. SIA closed the year with an EBITDA up 3%, so similarly, similar to us, with a very strong performance in the last quarter of the year, plus 13%. Revenues were also growing plus 2% in the year, and a nice 7% growth in the last quarter of this year, thanks to a resilient business model and a few projects and customer wins outside of Italy, as well as partially in Italy.
Net result was also pretty much in line with our expectations on EBITDA, despite the second wave of COVID. On an underlying basis, EBITDA was up 4% in the year. Actually up 21.5% in the fourth quarter, which is very remarkable, and is happening also on the back of a very positive cost measures that the company is undertaking. Revenues were again, on an underlying basis, marginally down in the year, -1.2%, with a -1.9% year-over-year in the fourth quarter. Again, please always keep in mind the fact that the second wave basically came out in the third quarter, and therefore is after when we announced basically our deal.
And, differently from Italy, the second wave has impacted more than the first wave, the geographies where Nets is present, in particular Germany, with the lockdowns that you are aware of, and the Nordics as well, which were less affected in the first wave. So a little bit of the opposite dynamic that we have seen in Italy. Now, let me jump into page six, and give you the usual overview of what are the volume dynamics that we are observing. As in the past, we are presenting you on page six, the combination of our issuing volumes and acquiring volumes. You see now, again, the fast recovery from the first wave. The first wave was minus 50%, basically back to marginal growth, in August.
And then as the second wave of COVID appeared, I would say outside of Italy, before Italy itself, you did start to see a new slowdown. And here you see that slowdown. It peaked basically around mid late November, at around minus 20. To then recover at the beginning of December, when basically no reopenings were allowed in the preparation of the Christmas season. Then it went down again, basically during the Christmas holidays, because Italy decided to have a hard shutdown in the holiday period to avoid acceleration of the pandemic.
And then, now, given that the results and the evolution of the pandemic was positive, there was a reopening after that, and you see that rapidly the volumes came back to much better levels and, again, close to last year results. Following page, page seven gives you the split that we've talked about in the past as well, in between Italian cards, so Italian consumers, and international inbound travelers. This is obviously very, very important because we continuously track the standalone Italian customers' behaviors, because that's where we expect to see the acceleration from cash to digital. And here you see... And that's basically the light blue line.
Here you see that while the international travelers contribution remains, negative, very negative, I would say it's minus 70%-80%, still. Now, you see that, instead, the Italian customers, already the beginning of February, late January, were back to positive growth, and you will see the details, in a moment. Very similar behaviors to what we have observed in the summer, even if, the, international travelers are not back, to Italy yet, are not actually traveling anywhere around the world yet. Page eight, I will spend, a few more seconds on page eight, because page eight is a very rich page in terms of, information, but it's a very important page as well.
Here, we provide you with the overview of what has happened across the three macro sector e-merchant services. Again, we separate between basic consumptions, groceries, medical, retail, utility services, so activities that remain broadly open throughout: 35% of our overall volumes. Second category, what we call discretionary consumption, clothing, household, other type of retail, and this is obviously very affected by the reopening and closing of the stores. And last but not least, the high impact consumption sector, that is the smallest one with a 31% weight, even if it's actually the largest one when it comes to e-commerce. On the table on the right, you see the evolution of this. Starting from the total, you basically find the numbers that we saw before.
Now they are presented in quarters, and you see the dynamics of the last few months as well. As I said before, we closed the year minus 12% in terms of overall volumes, minus 13% on physical, minus 1% on e-commerce. It's important to underline the fact that throughout the year, basic consumption has been growing 16%, so faster than what it was growing in the past. It has been running at a high double digit level, basically throughout the year. I would also underline the fact that in basic consumption and discretionary consumption sectors, e-commerce has been growing around 36-39%, so really, really fast, while obviously has been suffering in the high impact travel-related type of sectors.
I want to focus your attention on the last column, which is literally not the last week rolling. The last week rolling is particularly important because is the first week after a long period of time where the Italian regions are basically all in what is called the yellow zone, the yellow category. Which is basically meaning that most of the retail is open with certain limitations. Restaurants and bars can stay open up until six o'clock in the evening. You can again travel across regions, but still you have certain measures of lockdown implemented.
What you see here is that as a total, volumes were down -2%, so very close to last year values. But I think it is even more interesting to look at sector by sector. Basic consumption was up 24%. It was 26% for Italian cards, so what you see in the circles are the Italian customers only. So 24% for total, 26% for Italian customers. The discretionary consumption is particularly telling, up 3% on a total and up double digits for Italian customers only, while obviously the high-end consumption is still negative on a total basis, -43%, even if you see an improvement compared to the recent months with Italians being at -35%. Overall, again, Italians is at +6%.
On the following page, you see basically these dynamics are presented graphically. And again, I want to draw your attention to the fact that the dynamics that we are seeing now after mid-January are very similar to the recovery, the fast recovery we've seen from May to June after the first wave. The real difference, if you wish, is that the recovery of the underlying travel category is actually a bit slower now while the basic consumption is running quite visibly faster than what it was before during the rest of the pandemic, and much faster than what it was before the pandemic.
Now, before I move to results, let me close on page 10 with a couple of observations on what we see in terms of customer behaviors. Here, as always, we try to separate the effect of the pandemic from the underlying customer behaviors here, and basically, we are providing you two snapshots. The first one is on the left. This is basically the growth of the grocery segment on Italian cards. So if you basically focus on this segment, where basically the retail has been open with a lot of limitations in terms of access to stores and all of that, but has been broadly speaking, open throughout, and here you focus on Italian cards.
You see that throughout fourth quarter, the growth has been 21%, full year, 22%, January was 25%. So overall, a strong growth and much higher than what it was before the pandemic, although this sector was already a nicely growing sector. So a visible acceleration when you don't have the impact of COVID. Second data point that I think is also very remarkable here on the bottom on the right, you see the evolution of Italy. Now from the Christmas period, it was all red. Mid-January it was still a partial red situation with a remarkable focus on Lombardy, that is a large chunk of Italian economy. It was red together with Sicily.
And you see that now basically it is broadly speaking yellow with still some orange areas. And on the top part, top right part here, you see what is the performance that we've been observing a couple of weeks back when it was still a mix, or it was coming from mid-late January across the different zones. And again, here we look at Italian cards only. So red zone was a minus 4%. If you remove year-on-year performance, if you remove the effect of the high-impact consumption, which is basically broadly speaking closed across all the zones, basically red zone was actually up 5%. Orange zone is up plus 3% if you remove the high-impact consumption sectors above was above last year by about 20%.
And the yellow zone, which overall was up 17%, was actually going up 29% without the effect of the high-impact consumption sectors. Obviously, here there is a little bit of rebound, you know, when you reopen stores, people you know have the tendency to buy more than normal, simply because they could not buy before. But so that, we've seen that these numbers then tend to stick at a much higher level than before. So this is the overall picture on volumes. Again, to cut a long story short, second wave obviously impacting our overall volumes and the fourth top line.
The faster recovery being observed over the last three, four weeks, and again, visible signals of digital payments acceleration, I would say wherever you look at the details, neutralizing the effect of COVID. Now, let me jump into our financial results, and let me jump to page 12. Overall, as I've anticipated, with a strong financial performance, EBITDA grew in the quarter, in the quarter 8.3%, with a total for the year, basically 2.5% up. EBITDA margin went from 19.55% to full year 2020, 58%, also on the back of important cost measures that we took also on this cost, postponing certain investments and also on the back of.
The slowdown of certain activities that were actually not effective in the context of COVID. Overall revenues were marginally down -2.8% with the quarter basically almost flat year-over-year at 290 million EUR. Let me just now jump into the business unit by business unit focus. Let me start with merchant services and solutions. Obviously, the key drivers throughout the years have been the continued development of our propositions for both actually SME, large, and e-commerce. We continue to make progress to be able to address the broader merchant needs, but also more and more vertical needs, in particular, I would say in large and e-commerce.
We saw not just the volume dynamics, as I just described, but also more and more demand for advanced omni-channel solutions, also from SMEs. And obviously, we've seen a good traction with the merchants of the cashless initiatives. Now, going into a more granular update by segment. On SMEs, we saw a strong growth of the POS customer base. So despite COVID, despite a lot of stores being closed, we saw a growth for the overall base of about 4%, also driven by the vertical industry propositions. We see this actually continuing. Second, we saw significant acceleration on omni-channel and mobility solutions.
I think we spoke in the past about Pay by Link offer that is actually allowing merchants without an e-commerce presence to be able to sell and accept payments from remote by sending SMS, emails, WhatsApp, whatever they want to their customers. Actually, we had a good progress on SmartPOS as well, and we now launched also the proposition on Intesa book. We have completely redesigned the mobile POS proposition. We launched the new ones at the end of last year, and we're seeing a good traction. It's fully integrated with our digital properties already. Our Merchant App that was already quite successful, as seen, is now at above 55% penetration. We are starting to use it for upselling or cross-selling of higher value products and services.
And in parallel to this, we've been working through the year, in terms of adding, next to the banks in a bank-friendly way, additional channels to make sure that we can be with the customers wherever they decide to shop. And here, clearly, the rules of the game are online, retail, in particular, electronics and technology leading retailers, software developers, partnerships, ISVs, and ECR distribution partnerships, and we believe that will be an important contribution as we go forward. So this is it in terms of SME sector. Moving to the other two sectors, large merchants, omni-channel. We basically saw good volume resilience, thanks to the leading position on large scale food retailers.
We were obviously affected in the travel sector, even if we are not exposed to risk because it remains with the banks. But we obviously saw on large retail and large food categories a strong progress. Basically, we are continuing to develop our omni-channel proposition and it's becoming more and more differentiated. Basically, combining the best-in-class capabilities that you can find also with other international players, with actually very specific, country-specific needs and requirements, such as, for example, implementing cashback capabilities, implementing local scheme digital products, and so on and so forth. We've seen an acceleration also in projects in terms of omni-channel.
We saw a growing pipeline of customer demand in a list of emerging verticals that are understanding that omni-channel acceptance is very critical for them. Just to mention one, insurance agents networks, or pharma, and new retail chains. We also saw a strong pipeline on transport. Clearly, transport has been a hot topic for Italy for a while, and now we have more and more projects ongoing with local administrations, and we said in the past that we had prepared a specialist sales support team by vertical sector for larger merchants. We are now doing the same also for mid-corporates, that we believe in Italy are an important opportunity, given the structure of our economy.
As far as e-commerce is concerned, we saw strong sales results across all segments. Gateway activation, we have been up 50% year over year, and actually four times, if you include the Pay by Link, that is technically like a gateway activation. But putting that aside, there's been up 50%. We have enlarged our strategic partnership footprint with content management providers and marketplaces, like Italiaonl ine, Totem, and a few others. We already had many, and we simply continue to reach them. We had new wins in invisible payments, a good traction on public administration segment, where we've been the largest acquirer with a 100% year-over-year growth on PagoPA.
We are now applying a strong focus in managing, you know, the impact of the evolution of the strong customer authentication regulation in the Italian market, both at the merchant and the consumer, as well. Now, coming to results for the segment, page 15. In the quarter, revenues were down about 1%. For the full year, minus 3.4%. This was achieved despite a decrease on volumes that is consistent with the numbers and the graphs that I did show you before, minus around 10-15%, depending if you look at managed transactions and or value of managed transaction.
Basically, the revenues have been supported by a long list of measures that have been put in place, and the evolution of the mix of the volumes. Let me underline the fact that throughout the year, we've been more successful in selling technology products and technology solutions across the various segments, SMEs like, but also e-commerce. I think e-commerce is probably the most visible example where basically, you know, we had, despite the total volumes did marginally decline, actually, our revenues in the segment did go up, thanks to the sales of more technology advanced solutions. Now, moving on page 16, and moving on the second largest business unit, Cards & Digital Payments.
Here, the key drivers as well, being the development of our proposition towards more and more advanced products and services, the increased demand from customers and banks of more advanced solutions, and not only products, but also processes, for example, digital onboarding and remote selling. Last but not least, we also saw a good traction of government cashless initiatives as well. Moving into more specific updates on the card side, we saw a growth of the card's base. I would say, in particular, in the debit and prepaid segments that are more oriented to the mass market and for the everyday spending and e-commerce. We saw an accelerated interest on international debit, with now over fifty banks selling the product.
We are now launching a new version, a further premium version of international debit, because we believe there is room for segmentation into this mass market product. At the same time, we continue to support the evolution of national debit, implementing all the digital capabilities that are becoming available. Actually, we continue to see a growing interest and a growing pipeline for our business-to-business virtual card, working capital optimization product, while obviously, the broader business and commercial card segment has been affected in terms of volume by the COVID restrictions, and very much reduced level of business travel and activity more in general. When it comes to digital and VAS, we actually continue to see a growth of contactless transaction.
The penetration of another jump from 38% to 45%, basically from pre-lockdown to December. Here in this space, it's important to notice that, basically, in the first half of this year, we'll be rolling out the upgrade of the contactless limit from 25 to 50. What does it mean? That today, if you transact contactless below 25, you can avoid to basically put your PIN or sign the receipt. Over the next few months, this limit will go from 25 to 50, as by the way, has happened already in a few other countries. We also saw a step-up in mobile debit payments. Overall volumes were up 140% year over year.
It's still small, but I think also here, the needs of the customers are evolving, and we saw a good traction, and all our analysis suggests that this is an enabler of further digital payments, cash to digital payments conversion. Basically, we did continue to promote our loyalty program and all the other value-added services we have around it with further penetration. And then we actually did a lot of effort to support the government initiative, in particular, cashback, allowing our customers to have easy access from our apps and banks' apps as well, and basically enroll in the program as fast as possible, basically with one click.
Just to give you the point, if the country average is about 10% registration on the cards that where we manage the customer experience and more directly are the licensing cards, that penetration has been above 15%. Last but not least, on YAP, even if we've reduced the level of push, commercial push in the year, we saw in the last quarter an increase of almost 100% year over year in terms of person to business transactions. Moving to page 17.
Here you see the performance of the business unit, plus 2.4% on revenues in the quarter, supported by many of the initiatives that I've just listed, despite actually transactions have been going down single-digit to mid-single-digit, I would say, throughout the year, and were a bit negative also in the fourth quarter on the back of the COVID second wave. Third and last division, accounting for about 10% of our total revenues, Digital Banking Solutions. Again, it's similar key drivers here. The evolution of our offer becoming more and more digital, but also the increased interest from the banks and from third parties for self-remote and open banking solutions.
Here, the year was affected not that much by volumes, but actually by the fact that a lot of these projects depend on the willingness and the possibility for the banks to drive the execution, and some of the activities have been delayed or actually go around at a lower level. Key business updates here, again, in the self-banking space, we basically completed the rollout of our new front-end platform for ATMs. We continue to see a growing international, a good traction on advanced ATMs that are more valuable for us, plus 5% growth year-over-year. While the overall stock as banks rationalize their distribution networks has gone down 2%. Here again, we continue to drive evolution.
For example, now we have a personalized CRM on our ATMs, if the bank wants to implement it. Second, important area, digital corporate banking. Again, also here, we continue to innovate on the product. The nice thing is that despite all the challenges of a COVID year, we saw a growth in the install base for the product, plus 2%. This was an important year, 2020, also for the business to business and corporate payments. We did continue to evolve on instant payments, and actually we now have a strong commercial pipeline on corporate payments, basically from two angles. Number one, and it's actually very related to merchant services as well.
We are launching a new pay-by-account product for very large tickets, based on open banking. Where basically the merchant enables the customer on large tickets to pay directly from his own bank account, basically having direct access to the own banking of the bank through PSD2 enabled solutions in our gateway. As well as we saw growing traction for payment as a service for corporates and payment providers more in general. We've also renewed and extended our strategic partnership with Depobank that is now being acquired by Banca Farmafactoring, which is very important.
It's very strategic because it is allowing us to offer our digital payments technology-based services bundled with treasury, supplemental banking services, providing especially to the medium- and small-sized banks a bundle of payment and banking services at the same time. Last but not least, we continue to see good traction in open banking, where we've seen an explosion of volumes on the CBI Globe, though a bit less than what we expected because of COVID and also because of Brexit, given the fact that some of the third parties, the many third parties that are registered to the platform are actually UK-based, and trying to understand how to manage the implications of Brexit on their business.
Last but not least, here we continue to sign up world-class fintechs on our Nexi Open platform and partnership program, like Meniga, Experian, and we see more and more interest from the banks as well. Page 18, sorry, page 19. The results for the business units. Overall, the revenues went down about 3% year-over-year, with higher decrease in the last quarter of this year. We're talking about 2 million EUR here. It is basically important to go back to what I said before. This is basically driven by the fact that certain projects were postponed, and at the same time, we had a lower level of activities on the store.
As a given example, ATM interventions and technical assistance, we saw lower levels, given the type of behaviors we've seen, in the country in the year. Let me now hand it over to Bernardo. That will complete the overview of the results, and I will come back to comment on-
Yeah, we'll give Paolo a chance to catch his breath after a long, introductory session on how I think hopefully you have appreciated how strong the performance was in terms of revenues and the resilience of our business models. But it's important also to have a look at how we were able to protect our P&L and our cash flow in terms of the cost containment. Overall, for the year, we reduced costs by 45 million EUR. That's a 9% reduction, driven by the cost containment program where we exceeded our 100 million EUR target. The continued focus we have on our overall efficiency and the benefits we're getting from the implementation of our IT strategy.
As you see, the fourth quarter had an acceleration in cost reduction compared to the average for the year. We're down 11.5%. This is due, I'd say, primarily to seasonality and the fact that the cost-cutting program was announced in May, but it took, you know, full speed in the second half of the year. We have a reduction in staff costs. This was driven by the variable component of compensation, which was tied to, you know, performance targets linked to EBITDA, which we clearly didn't reach compared to our budget, which was set at the end of 2019, and reduced the bonus pool for some of us.
Reduction in travel expenses, the benefits of smart working and therefore lower costs related to overtime payments and fuel consumption and meal vouchers, et cetera. This was accompanied by a double-digit reduction in admin costs. These include, clearly, the benefit of lower volumes driving lower processing costs, but also the cost-cutting program that we mentioned earlier. I think it's important to note also, this is, you know, particularly the case when we look back to concerns that we had and a lot of you had walking into the COVID environment back in the first quarter of this year.
When the cost of credit was a major concern, and indeed, we closed the year pretty much in line with what we had last year for both issuing and acquiring. In total, we had EUR 6.3 million of credit-related losses. This is basically flat year-on-year compared to 2019 on the same accounts. Moving on to slide 21, just a summary with regards to the cost containment, the cash flow protection plan we put in place. This was really about, as I said, protecting our cash flow, our cash position, not really structurally improving the P&L.
What we did was cut everything which we could cut, which was variable or discretionary, which would inherit future growth in terms of our IT strategy or our business. But it was about reducing, well, what automatically fell in terms of processing costs with lower volumes, but also we froze some of the hiring or pushed them out into the second half of the year when we had greater visibility on COVID, consulting expenses, et cetera, et cetera. Overall, we overachieved compared to our target. We'd set ourselves 100 million EUR of cash containment. We exceeded that by approximately 5 million EUR. Part of this fed into the P&L, part of it was just cash flow CapEx, therefore, balance sheet, part of it was under EBITDA.
But it helped outperform, I would say, what had been our ambition with regards to the EBITDA. We'd set ourselves back during the course of the summer. Slide 22 moves on to CapEx. As you can see, we have a reduction of 20% in CapEx, to EUR 335 million. Ordinary CapEx is approximately 10% of revenues, as you would expect. The transformation CapEx, I mean, we kept on investing in what is core for future growth. What we delayed were initiatives which were primarily tied to our client business, which was probably more heavily impacted than it was than for us, and therefore, we've moved some of those expenses out into 2021.
Some of it was avoidance, and I'll speak to that in a second, of CapEx, which would have been a duplication of CapEx, which we, you know, will fund through the synergies or effectively the merger with SIA, and we spoke of at the time of the announcement of SIA. We can see that on slide 23, where we show the graph, which summarizes the evolution of our transformation IT strategy and the transformation CapEx spend. Back in June, back in with the June results or the end of July, we had approximately 120 million EUR of IT strategy or transformation CapEx spend left. We are now 65% complete.
We would have had EUR 103 million left, so approximately EUR 17 million left. We would have had EUR 103 million of transformation CapEx to be completed by 2023, and since announcing SIA, we have effectively crystallized the reduction of approximately EUR 40 million of this EUR 103 million. Therefore, we will save approximately two-thirds of what we announced at the time of the SIA transaction, the EUR 65 million one-off CapEx savings. EUR 40 million, we've already defined where they're going to come from, and therefore, we can reduce the Nexi transformation CapEx spend for the next few years by EUR 40 million, so reducing it to EUR 63 million.
The remaining CapEx savings, so between the EUR 40 million we're saving in Nexi and the EUR 65 million target we gave you, will be savings that SIA will have in their CapEx spend. Just to exemplify it, we were planning to build our own issuing processing platform. We will no longer do that because we will adopt the SIA platform. Similarly, SIA was going to work on their core acquiring platform. We have a new state-of-the-art core acquiring platform, which is ready to go, and therefore, there will be saving CapEx related to that.
The overall impact of COVID has been to flatten this, what used to look like, you know, a curve. It's flattened it out because of us pushing out some of the CapEx we're going to incur in 2020 out to 2021. So you see a slight pickup next year in transformation CapEx and overall CapEx. But overall, the quantum is reduced by the savings I just mentioned. Slide 24 shows that also below EBITDA, we continued to reduce transformation costs. They've been halved compared to where they were in 2019, and I remember in 2019, when it was down more than 60% compared to 2018. Essentially, half of this transformation is now related to YAP. The other half is equally split between some pure transformation costs.
I'll mention, for instance, some penalty payments, we made to get out of certain contracts, including rental contracts, for our Mercury Payment Services subsidiary, where we've closed their headquarters and relocated them here to the Nexi headquarters. So there's some penalties associated with that, associated with the exit of certain long-term contracts and the maintenance of our laptops or our desktops, et cetera. And the other is just sundry, I would say, consulting expenses associated with the ongoing and almost finalized transformation here at Nexi. On the right-hand side, we show a chart which takes us from the transformation cost to everything which is below EBITDA.
And this includes essentially two big buckets, which are M&A fees related to the Nets and the SIA transaction, which are clearly one-off. And in the EUR 23.4 million bucket, we have half of this is the non-cash LTI component of deferred compensation. The other half is related to COVID costs, so sanitation of head offices, buying masks and vaccination of the flu, the early COVID, unfortunately, the other flu, et cetera.
We also have 17 million EUR of costs which flow through our P&L, but are actually met by Mercury UK, so they have a zero impact on Nexi, but need to be, for accounting purposes, booked into our P&L, and this is a legacy of the IPO scheme, which was triggered with the IPO back in 2019. Slide 25 shows the bridge from EBITDA to normalized net profit. We have a normalized net profit, which is substantially, I'd say, in line with last year, slightly down at 245.8 million EUR. If you took out from last year the capital gain on the sale of Oasi, you would have a slightly better performance this year compared to last year.
But in general, in line with last year, which is not surprising, given that EBITDA is roughly in line, slightly higher than last year, but roughly in line with last year. Page 26 is a strong, I'd say, testament to the strength of our balance sheet and our ability to convert EBITDA into cash, 80% compared to 77% in 2019. This is before interest and taxes. After interest and taxes, we have 280 million EUR normalized free cash flow. We will be upstreaming north of around about 350 million EUR of cash from the subsidiaries to service debt at the parent company level, which is what you see from this point down, the normalized free cash flow.
Add back the interest expense, which is more in the, in the next level. You get the cash, which gets upstreamed from the payments subsidiaries. Slide 27 is a summary of the evolution of our net financial indebtedness. We continue to deleverage. What we have shown here is what the trajectory would have been, excluding the acquisition of Intesa, which closed in June. So we took on board additional 1 billion EUR of debt. Had we not done that, we would land at the end of 2020, notwithstanding COVID, at two and a half times leverage, which is in line with the guidance we gave at the IPO in terms of our midterm guidance, midterm target, which was expected for 2021. So we are a year early in reaching this deleverage target.
Clearly, Intesa happened, and that's a great deal for us, but that increases leverage in the short term. We're still within what we had highlighted at IPO to be our comfort range in terms of, leverage. So we closed the year three and a half times, which is EUR 2.1 billion of net financial debt compared to the EUR 600 million EBITDA. So Paolo, now I can hand the floor back to you for guidance.
Thank you, Bernardo. So let us recap basically how these 2020 performance compare to what we declared as ambition for 2020. As a reminder, we did declare this 2020 ambition in July, when we were seeing a very good recovery happening and before any of us could foresee a second wave of COVID. At that point in time, we said that we were seeing a possible return to revenue growth by year end. Despite the second wave of COVID, we saw positive growth in the third quarter, and as you've seen, we basically had a fourth quarter that has been fully into second wave, basically flat year over year.
Second, we said that the EBITDA level, we wanted to grow EBITDA versus 2019, and we were targeting material growth of EBITDA minus CapEx for the year. Despite the second wave of COVID, we saw basically EBITDA coming back to growth in third quarter and remaining in the growing space until year end. For the full year, we grew EBITDA by 2.5%. We did over-deliver our cash cost containment plan, despite, as you're seeing, the volumes have been probably a bit better than what we expected.
Overall, we saw normalized operating cash flow conversion at 80%, with a cash position improved versus last year and with our leverage improving, even better than expected, and at levels that were actually not better than what we thought would have happened at IPO time, again, despite COVID. As you clearly understand, if we are delivering these results despite the second wave of COVID, and you saw the impact of the second wave, this means that despite the second wave, the rebound of volumes and the overall transition from cash to digital has been happening better than what we were expecting, now, despite the second wave of COVID.
Now, putting 2020 behind our shoulders and looking at the new year, 2021, we have decided to basically not provide what we would normally call a guidance, so we consider our guidance still suspended. But as we have done in July, now, we basically provide our view, our ambition for 2021, and our ambition is clearly to go back to material growth in 2021. Let me be explicit on what we see for the year, and then I will comment a bit more to make sure that we provide you as much color as we can.
So, assuming a gradual recovery in the first half of the year at the current trajectory, broadly in line with current trajectory, what we expect for the year, the ambition we have for the year, is a mid-high single digit revenue growth, a broadly stable EBITDA margin, which is up three percentage points versus twenty nineteen. A broadly stable CapEx intensity ratio, also thanks to the anticipation of the M&A synergies, and a continued strong organic cash flow generation and deleveraging profile. Now, a few comments to provide color here again. Basically, our outlook for twenty twenty-one, before the second wave came, so when we were preparing our budget for the new year, and we were at the beginning of October, was actually double-digit revenue growth and double-digit EBITDA growth, to be very, very clear.
Now, then, the second wave came, and, we obviously did decide to take a more cautious, approach. The second comment, I would have, is the fact that we consider this, again, to be an ambition rather than a precise guidance, because honestly, the outcome of the year may depend more on the evolution of the pandemic and its impact on economy and society and government decisions rather than on our own performance.... And honestly, we don't want to bet our guidance on that. That's the reason why we continue to talk about ambition. And honestly, as I said, the performance will very much depend on that. We're taking, these, mid-high single digit revenue growth, view, because it's really, the midpoint of a broad range.
It's a midpoint of a broad range that can be double-digit, despite the second wave, because if the recovery goes fine, everything goes well, you have a little bit of support from Cashback and so on and so forth, absolutely realistic to see a double-digit revenue growth, but at the same time, if instead we have new lockdowns, we have go back to red zones, we have third waves and stuff like that, then it's gonna be very difficult to be a double-digit, and we may be at a mid-single-digit.
So we believe it's better and more conservative and transparent with the market, with all of you, to be explicit about this hypothesis and to provide you what, is, at the end of the day, the midpoint of a broad range of outcomes that only partially depend on us. The third comment, I want to make is on, EBITDA, dynamics. On EBITDA dynamics, we have to remember the fact that we've expanded three percentage points of EBITDA margin in the COVID year. I think this is a very unique situation, performance in, the sector. As we said in the past, very specifically, some of the costs do unwind in the new year. They have to do with commercial activities, they have to do with many other things.
This is the reason why, now, we in the year now we expect to have a stable EBITDA margin, but I want to put this in perspective. If you take our midpoints of the outlook for twenty twenty-one, no, and you compare that number, that outcome, with two thousand nineteen, that was the last stable moment of our recent history, if you combine the honestly, very good performance, and I would say better than many others, in twenty twenty, with the outlook we're giving you in twenty twenty-one, basically, what you find is that we would have a mid-single digit growth of revenues from two thousand nineteen to twenty-one, so not only we are already back to the levels of two thousand nineteen, but we are actually about mid-single digit up.
And similarly, for EBITDA, you would have, you know, a growth from 2019 to 2021, up about double digits, which obviously confirms, you know, the operating leverage improvement that we had in the past, and we believe will continue in the future, simply cannot emerge in these two strange years, 2019 and 2020, in the spec- sorry, 2020 and 2021, in the specific year. That's the reason why you see the confirmation of the margin, but not further margin expansions due to the unwinding on certain cost cuts, and actually the investments that we do for the growth of the business. So this is the outlook that we see for the year.
Let me just conclude, going back to the three key messages I gave you at the beginning of page 30. Very special year, I would say, for all of us. Three key messages for us that will remain for 2020. Strong global performance, despite COVID, despite the second wave of COVID, I would say, in particular, growing EBITDA, low single digit, growing EBITDA minus CapEx, double digit. Visible signals, second message, of acceleration of digital payments, basically on the back of the digitalization of the society and the economy, and the fact that the superiority of digital payments versus cash is becoming more and more clear to citizens, merchants, banks, everybody in the society, and now, initial good signals of good traction of the government interventions as well.
Third important message, in 2020, we have accelerated our transformation from an Italian PayTech leader into a European PayTech leader. That transformation is well on track, and we're progressing according to our plan, signing the SIA deal today, and basically filing for antitrust approval on that a few days back. Overall, now what we have achieved in 2020, the outlook in terms of customer behaviors and evolution from cash to digital, and the transformational initiatives that we started in the second part of 2020, make us feel very positive about the outlook for the future. I will stop there, and I'm very happy to take your questions.
Excuse me, this is the Chorus Call conference operator. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Stéphane Houri with Oddo BHF. Please go ahead.
Yes, hello, good afternoon. So, I have two questions actually. The first one is on the revenue, let's say, ambition for twenty twenty-one, when you said mid- to high-single digits. In fact, it looks a little bit better than your, you know, normal guidance of 5%-7%, and this despite the COVID-19 impact at the beginning of the year. So, the question is to understand what is doing better? Is it the cashback program in Italy that is driving more volumes? Or is it, you know, an accelerated digitalization of the economy... more digital payment, more online. So if you can, you know, just clarify that for me.
The second question is about the absence in a way of operating leverage, because you're guiding for a flat EBITDA margins for the year. Despite this growth guidance, so can you, you know, re-explain the different elements that lead you to guide for flat EBITDA margin? Is it question of, you know, costs coming back after the cost containment program? Thank you.
So, Steven, thank you. Thank you for the two questions. I think they have a common theme here that I reiterate, because I think it's really important. I believe we cannot look at twenty twenty-one in isolation to what has happened in twenty twenty, because somehow, the worse you perform in twenty twenty, the better you perform in twenty twenty-one and the other way around. That's really the reason why it's important to look at these two years in combination. And by the way, when we project our volumes in the future, we continue to look at what we thought was twenty twenty budget, because otherwise you get completely misled.
So this is the reason why, the way I would frame the comparison with our guidance, is it's a combination of 2020 and 2021 outlook. If we take again the midpoint of 2021 outlook, basically, now the growth, now would be of 5% from 2019 to 2021. So that's, I think, the important way to look at these revenues. So not only we recover COVID, but we do 5% better than that. Yes, you're right. Technically, we are somehow in the previous guidance, we doubt, but I think technically, it's probably better to look at it as a combined two years basis. As far as leverage is, operating leverage is concerned, the same logic has to apply.
If you look at our performance in 2020 here, operating leverage has been somehow super strong, because we grew a bit up by 2.5%, despite revenues going down minus 5, minus 2.8%, thanks to a cut of cost of 9%. So honestly, I never understood how you manage how you calculate... How we calculate operating leverage on negative numbers, but that doesn't really matter. What really matters is margin expansion from 55% to 58%. This year, certain cost reductions will unwind, and hopefully we will have a stronger level of commercial activities as well.
This is the reason why, you know, this year, we are therefore confirming the EBITDA margin of 2020, which means that over the two-year period, and again, this is the right way to look at it, we believe, we saw a margin expansion of three percentage points, from 55% to 58%. By the way, in organic, so this is already making the contribution of the SIA book acquisition. And this is basically the operating leverage improvement we've seen over the last four or five years, 1.5 percentage points per year.
Simply, this year we had three percentage points of expansion, and the second year where instead will be more flat. So again, let's take the two years view.
Okay. And sorry, but a quick follow-up about Q1. Last a few weeks ago, you were tending to say that you would expect a negative Q1. With the most recent development, do you think that Q1 will be growing compared to Q1 last year?
Honestly, I don't have a memory on what you're saying. I think at Q1, the specific Q1 this year, again, so we're not providing the guidance for the year. Let me please not get into providing the guidance for the quarter. Again, the output will depend very much on the comparison for last year. Now, you remember very well that last year we had a very good January, I would say, a very good February as well, and then the disaster of COVID exploded in March. Now, this year our expectation is that obviously, compared to last year, as a consequence, we will have a soft January. I did just show you the numbers.
February, it depends what happens over the next couple of weeks, but you saw that year-on-year volume dynamics start to be more similar to the ones of last year, and then let's see what happens in March. I don't know, Bernardo, if you want to comment more than this, but this is, at the end of the day, what we see. I think all in volumes may be ending up with being broadly not far from last year, but again, it will depend on the evolution over the next few weeks. Bernardo?
All I would add, Paolo, is that, you know, in putting together our ambition, I think, you know, we take comfort from how we're performing in January and February compared to the ambition we stated, I would say.
Yes, of course.
Okay. Thank you very much.
The next question is from Mohammed Moawalla with Goldman Sachs. Please go ahead, sir.
Great. Thank you very much. Good afternoon, Paolo and Bernardo. I had a couple of questions. Firstly, just want to clarify on your comment around the 2021 outlook.
Are you effectively saying that in an upside case, a double digit is possible? Or do you think that, you know, if obviously as things start to reopen, that in a base case could be achievable kind of at the upper band of your guidance? Just wanna kind of understand the nuances there. And then secondly, you know, as we think of that shape of that recovery, you know, I know maybe you can help us a little bit around sort of that, you know, is your assumption that even the large part of Q2 is still somewhat at a similar run rate with what we've seen in the first two months of the year? So just wanna get a sense of that sort of acceleration in the back half.
Then sort of as we start to think about this more, medium term, you obviously had that sort of 5-7% objective, but when we start to look beyond sort of 2021 and even 2022, given to what extent do you think some of the sort of shift from cash to card, how much of that do you think has been brought forward? So how should we think of a sort of more normalized growth rate in Italy, and are we gonna revert back to sort of the lower band of that guidance? And what I'm trying to get at is how much of that sort of demand has been pulled forward. Thank you.
Good afternoon, and good to hear from you, so again, on 2020, sorry, 2021 outlook, yes. I mean, double digit growth is possible. It depends what kind of assumption you make on the speed of recovery. We have been surprised by how fast the recovery has been in the latter part of January, and is being as we speak. It depends if the speed of recovery is gonna be reabsorbed over the next two or three months, or this kind of overperformance will continue throughout the rest of the year, but it is definitely possible.
I also, again, want to underline the fact that if that goes the other way around, you could also end up on a lower end of, whatever, 5%-10% range or whatever you want to consider, you know, the range for a midpoint and mid-high single digit. But yes, double digit growth is possible. And by the way, as I anticipated, this is what we had in our plans before the second wave. Now, when it comes to the recovery, the shape of the recovery, the way we planned this, let me try to really give you the sense of what we do and we planned. The way we planned this is basically sector by sector.
So we, you remember, now, the three categories: basic consumption, discretionary, and high impact. And also, we separate in between Italian cards and foreign cards, because we've seen that the dynamics are very, very different. And by the way, the foreign cards are not directly affected from the same acceleration of cash to digital transition that we see for Italian cards. And here, the benchmark for us cannot really be to basically do our plans, the actuals of 2020, because the actuals of 2020 are, by themselves, completely erratic, depending on how deep the pandemic has been. And therefore, somehow, our benchmark remains what a normal 2020 would have been without the pandemic, which was actually our initial budget of the year, no?
Keeping that in mind, just to give you a flavor of the outlook now that we see for the year, we basically see an outlook where Italian cards, you know, will basically go back to positive in Q2, and basically over the rest of the year will go basically to low double digit type of growth. Again, you've seen that already in March, in February, they are into positive space. Within that, we expect to have the basic consumption continue to grow double digit in a very solid way, well supported by cash to card transition.
And we see discretionary consumption going into the double digit space from the second quarter, again, if the reopenings remain such. While basically instead we see the high consumption sector, the high impact consumption sector recovering very, very, very slow and maybe coming back to normal levels at the end of the year. So this is it for Italian cards.
As far as foreign cards, so visitors to the country, instead, we are taking a very cautious approach, and here we see a very gradual recovery where still the summer will see an important gap versus normal, and we would end the year again with a material gap because we believe that international travel will be the last thing to be restated into normality on the back of COVID. So it's done with a lot of, I would say, detail and analytics and so on, so forth, but unfortunately, no, you know that it is false precision. But this is at the end of the day, you know, what is behind this logic.
The last but not least, medium term, listen, we remain positive on the fact that this acceleration from cash to digital payments will continue to be sustained. I think, we are seeing shifts. We've seen shifts in 2020. We continue to see shifts. That probably will be also even more supported by the government initiatives, as it has happened in the past. That is why when we think about a mid-term future with a mid-high single digit for normal years, not for this year only, but for normal years, mid-high single digit EBITDA growth and a double digit.
Sorry, revenue growth and double digit EBITDA growth, we still feel comfortable with that type of outlook. Obviously before.
Yeah, that's very clear. Thank you very much, Paolo.
The next question is from Josh Levin with Autonomous. Please go ahead.
Good afternoon. I have two questions. The first question is, there has been talk in recent weeks of consolidation in the Italian banking sector. Can you comment on what that might mean for Nexi and to what extent it's reflected in guidance? And the second question is: have you seen or do you expect to see any impact from secure customer authentication? Thank you.
Hi, Josh. So, Italian banking sector consolidation, I think, we also did highlight in the past that, for us, Italian banking sector consolidation was a fact of life, in the sense that it was somehow in our projections. So in the projections that I've given to you, we have factored in already the potential impacts of the consolidation that is happening, that is the combination of... Sorry, the acquisition from Intesa of UBI, and the sale of certain UBI assets to Depobank. So the impact of all of that is already in our assumptions, and is broadly in line with what we had before. Obviously, not talking about potentially buying the book.
I am talking about the organic implications of this, potentially the UBI book acquisition may be an upside to this. To be honest with you, we don't expect. And sorry, and other things that are happening, or may be happening, are somehow into our plans already. On the press, you read a lot about Unicredit, Monte Paschi, all of that. Honestly, it's really too early to talk about it, and we don't see impact next in twenty twenty-one, not necessarily in twenty twenty-two either, because these things, before they happen and before they go into execution, it takes a long time.
As I said before, in our overall guidance, we try to take all of these potential combinations into account. On SCA, we are heavily on the topic, because as you can imagine, this is a very important evolution. We all should always remember that e-commerce in Italy, the new Strong Customer Authentication implementation, is again affecting only e-commerce. Therefore, the Italian market has a more limited impact, given the lower weight of e-commerce. The way it works is that from the beginning of the year, you will have these new rules being applied with stronger customer authentication.
January was a threshold of 1,000 euros, so you have to apply them above a thousand euro. From the beginning of February, it is above EUR 500, and there is a roadmap to continue to decrease this. We are clearly observing very carefully the customers. We did put, obviously, in place all the upgrades that were necessary with most of our merchants already. And we are upgrading the experience with the new tools of the consumers that are our bank's customers, and here we are at different stages of development. By the way, we are trying to find solutions also to our customers that get stuck into the process.
And in parallel, we are also developing more advanced artificial intelligence-based ways to help merchants and consumers, so both on the merchant side and the issuing side, to basically reduce the impact and allow merchants to basically transact before raising the Strong Customer Authentication needs, simply based on the knowledge of the customer. So it is in progress. We are in continuous conversation with institutions to make sure that we manage this process properly. But clearly, in terms of customer experience, this is a change.
So, I'm sure it will have, over the next very few months, some short-term impact, but I would say immaterial on our numbers.
Thank you very much.
The next question is from James Goodman with Barclays. Please go ahead.
Great. Good afternoon. Thank you. At the risk of asking another clarification on the guidance, just to start with, there was just one thing that I wasn't totally clear on from your comments, just in terms of the sort of approach to cost management into the year. So, I completely understand your points, Paolo, about the sort of growth in the margin versus two thousand and nineteen.
I just want to understand whether you're really managing a sort of cost base to that mid- to high-single-digit growth level, or you're really sort of managing to a margin into next year, i.e., if one thinks that revenues are going to come back, you know, more strongly than your guidance, would you see some outperformance, do you think, on the margin, or would that be an opportunity to maybe slightly accelerate some of the sort of investments planned or the return of costs?
And then the other question I had just on SIA, very strong performance in Q4, realize you don't have control or complete visibility there, but wondered if you can go into a little bit more detail on the projects that you mentioned, just how they managed to deliver such a strong performance in the final quarter, and whether they've communicated any sort of an outlook for their business into next year. Thank you.
Hi, James, and thank you for the two questions. Before I hand over to Bernardo to provide you a deeper view on this, let me just make one comment on the way we think about cost versus revenue and so on and so forth.
To be clear, our key topic, I mean, the core driver remains revenue growth. We are into a growth business. We believe there is a lot of growth possible in our sector in Italy, in particular, I would say the broader region will be present in the future. So we'll not sacrifice future revenue growth for short-term cost efficiency. Here, it's really, really important that we look at the two years altogether.
If you take our costs from twenty nineteen to twenty twenty-one, underlying our ambition for twenty twenty-one, de facto, you have cost reduction, so we will be a minus 2-3% cost base from two thousand nineteen to twenty twenty-one, despite a material growth of volumes. So you see, we continue to push for efficiency measures wherever they're not impacting the opportunity for pushing growth. And that's, we believe, is the important way of looking at it, and our mindset is very simple. Basically, we run efficiencies all across to be able to fund further growth in an efficient way. Bernardo, you want to add on cost, color on cost, and then SIA?
On costs, obviously, I'm biased, but I think we're underselling our efforts on costs because we are going to be structurally below where we were in 2018, 2019 going forward, notwithstanding volumes going back. And, you know, at times when, you know, all these questions on the guidance, I think, you know, we're, again, maybe not 100% clear. If we closed 2020 slightly worse than we did, so if we'd underperformed slightly, you know, there'd be no question about double-digit growth in revenues. We're kind of victims of the fact that we ultimately did a little better than expected, at the end of the year, and therefore, we closed, we closed well, and this has cannibalized part of the growth in 2021.
But if you multiply out our guidance, both on revenues and EBITDA, and therefore implicitly on costs, the message as Paolo has passed on should be loud and clear that we will end in terms of revenues probably higher than where we would have been in 2020, based on the previous guidance. So if you grew 2019 revenues at the high end of our guidance for 2020, then what we will have in 2021 is higher than that. So we're growing, notwithstanding COVID.
And on costs, we are below where we were in twenty nineteen, which is, you know, a function of, the insourcing of some of the costs we were, you know, we were paying out to, SIA and to, Worldline, and in part, other efficiency measures that we were, we were making. Now, in terms of the rebound next year and how we manage the cost next year being twenty twenty-one, sorry, the cost this year, you know, we started our budget. Some of it is zero-based, some of it is, you know, unfortunately, fixed or inertial. But we have the reappearance of certain costs which are not proportionally tied to the growth in revenues.
Think of, I know my very variable compensation or Paolo's variable compensation, that is disproportionately tied to our achievement of EBITDA, and not therefore 100% tied to revenues. This has gone to zero in 2020. In 2021, hopefully, we meet our EBITDA target, you know, we will be paying that, and that is not really linked to the growth in revenue. So you have this structural rebound in costs in 2021, which is, independent, I would say, of the growth of revenue. So that said, on costs, sorry, James, you wanted an update on SIA, right?
Yeah.
On the progress of this. So SIA, we published in the appendix of our document a table showing the P&L for SIA. As you can see, SIA was, you know, grew revenues and EBITDA for the full year, so I think quite a strong performance. This is a function of both the resilience of the business, which is being, you know, primarily a processing business, is less affected than we were by volumes, because the value of transaction is less of a driver for their revenue than it is for us. It's more about number of transactions. Also, their business is also further skewed than ours to payments which are not necessarily card rails, but bank transfers, et cetera, which were less impacted by COVID.
So structurally, they have a business which was, you know, better protected by the impact of COVID. And additionally, they had some client wins and just grew the business organically, such that that revenues overall in the year grew 2%. And in the quarter, if you look at it, and this is more the effect of the client wins year on year, so they won clients at the end of 2019 and got the full effect of this in the fourth quarter of 2020. So we have revenues on a quarterly basis, 2019 over 2020, in the last quarter growing 7%. And the same holds true for EBITDA. So even though their costs actually grew, they were less capable, I would say, than we are. Again, more of a structural issue.
They have less variable costs in their cost base, so their costs grew. EBITDA, nonetheless, grew 3%, so in line with what we have managed to deliver. And if you look at the fourth quarter performance, EBITDA actually grew double digits at 13%. So overall, I would say SIA has performed in line with, obviously, our expectations, probably slightly better, but I would say has produced a strong set of results which allow us to look at twenty twenty-one optimistically.
Very good. Thank you.
The next question is from Adithya Metuku with B-BAML. Please go ahead.
... Good afternoon, guys. Just two questions, please. Firstly, you talked about large customer wins on Pay by Bank. I just wondered if you could give us some color on how the take rates with Pay by Bank compare for you compared to card payments, how the economics works, and, you know, how should we think about one-to-one transposition of these transactions, card transactions by Pay by Bank? And secondly, just on, there was a line in the press release talking about the option to SIA's owners to issue more capital.
Just wanted to confirm that this doesn't mean that the share count will change, you know, post the two transactions being completed. It'll remain at, you know, what you expected it to be before, you know, regardless of the timing of the closure of these two transactions. If you could clarify that, that would be great. Thank you.
Hi, Eddie. This is Paolo. So I, I'll let Bernardo cover the second point. On the first point, let me try to answer in a simple way because it's something new that we are starting to engage with our customers right now. Let me put it this way, the pricing is structurally a bit different from the one that you would have for card transactions, but the way it's designed is to basically have a take rate that is broadly in line with the one of debit cards. Here, it's important to remember the fact that normally these are transactions that would not flow through cards. This is really important. So we are enabling through our gateways, now, transactions that would normally go in a different direction.
Now, thanks to the fact that we enable them through, you know, our technology, now, hopefully, we will be able to to make a good business also on these type of transactions. On the share count, Bernardo?
Yeah, sorry, Eddie. The share count potentially will change depending on whether CDP, the anchor shareholder in, the controlling shareholder of the, of SIA decides or not to exercise its anti-dilution option. Obviously, the enterprise value of SIA will not change, because what will happen is, CDP will put money, put cash into SIA, reduce the indebtedness, increase the equity value within the enterprise value, and therefore there will be an increased number of Nexi shares issued, and there will be a lower level of net debt. And this is something which, CDP will evaluate further down the line, pending, you know, whatever decision-making process they have internally that it needs to go through.
Understood. So essentially, the economics for the equity holders of Nexi shouldn't change. This is just a mechanical move, is that my understanding?
Yeah, to equity, effectively. So you will have, you know, greater EPS dilution coming from the greater number of shares, but you will have then a benefit because lower leverage, lower interest, et cetera. Now, whether, you know, the weight of the two, you know, it's up to you to decide whether that's a positive or negative. Clearly, you know, one would try and maximize leverage, but at the same time, you know, we are at three and a half times leverage. We probably don't wanna go much beyond that.
Understood. Thank you.
The next question is from Sebastien Sztabowicz with Credit Suisse. Please go ahead.
Yeah, hello, everyone, and thanks for taking the question. On digital payment, basically, the shift seems to be accelerating in Italy. Where are we standing right now in terms of card penetration in Italy? And do you believe there is a way to exit the crisis with a little bit of stronger volume growth potential in the Italian market following the COVID-19? And the second one is on the cashback bonus measure, because it seems that in Italy, there is some newswire talking about some potential push from some opposition party to cancel or delay the cashback in order to reallocate the fund to other measures because of the crisis. Do you have any idea of what is happening and the situation there? Thank you.
Hi, Sébastien. So on penetration, unfortunately, it's very difficult, as we speak, to have any real data of where penetration is. I mean, our underlying assumption for our plan in the new year is that basically, while in a normal period, penetration of digital payments would grow around one to two percentage points every year, so let's say one point five. Our underlying assumption is that in the new year, it's gonna be double that. As far as longer term volume growth is concerned, I basically am quite positive about it, but again, I really don't want to overshoot on it.
I think, what is happening, is showing that people are really, you know, getting more and more comfort with this type of, service and with the value added of, digital payments. And actually, in Italy, there's a new government being created, and, despite the specific measures that they may decide to take or not to take, clearly, I think everybody sees as, digital payments as, something that creates, benefits for the society in terms of, again, efficiency, modernity, but also, somehow, transparency and as well as security as well.
Now, when it comes to specifically on the cashback, there was, I mean, the situation is that the new wave. So in December, there was a kind of a trial, a Christmas edition type of wave, and that has been going well. The prizes, the cashbacks will be paid at the end of, in, again, towards the end of February, beginning of March. Now we are already into a second wave that will last for the six months of the year. And again, this is having a good traction.
Currently, the current government, the government currently in place, has budgeted around EUR 1.3 billion, EUR 1.5 billion for this year, and potentially more for next year. Honestly, it's impossible to project what the new government that should come in place over the next few days in Italy will do. I think everybody sees the merit of promoting digital payments, no doubt. Will they decide to reallocate part of this budget somewhere else? Honestly, this is a political decision that has nothing to do with us.
I think it is clear that promoting through whatever measures, including the lottery, honestly, now, digital payments is something that creates value for the society, the economy, and for the country itself. So I think that we continue to see these measures being implemented in the future as well, maybe different shape, different size, but again, we remain positive on the topic. We said in the past that we don't want to bet on specific new initiatives from a third party and so on and so forth. We continue to have that position even if we think positive about it.
Okay, thank you, Paolo.
The next question is from Hannes Leitner with UBS. Please go ahead.
Yes, good afternoon. Thanks for letting me on, and congrats to the strong cash cost control. Maybe just to phrase it, you know, in terms of transaction volumes, and cash to card and digital payments, clearly there were a lot of moving parts due to the pandemic. Your e-commerce shares remained the same. So if you now look at, for example, in your in-store customer base, do you appear that there the share of card payments have increased, and what kind of validation points do you have? That's the first question.
And then in regards to your margin, many questions have been asked, but in terms of your ability to keep growing EBITDA faster than revenue, should we expect that twenty twenty-two you will return to that? And then just some small questions on your merger partners. Clearly, you don't own those assets yet, so just directionally it would be helpful. In regards to SIA, their large contract with an Italian bank, should we expect that this will be signed or was signed at the same price, at the same conditions? So there is no potential revenue headwind expected. And then in regards to Nets, we only have constant currency growth numbers and pro forma numbers for a couple of acquisitions.
So do you expect to maintain this strategy of bolt-on acquisitions for small bolt-on acquisitions going forward once you have consolidated the assets?
Hi, Hannes. So let me take three of the four, and then I will let Bernardo comment more on the evolution of the SIA relationship with that large customer. Listen, on e-commerce, it's very difficult to project what will happen going forward, because, I mean, the dynamics we've seen throughout the pandemic are very, very complex. If you simply look at the data that we did provide on page eight, you clearly see the shift.
Now, you just take, I don't know, basic, discretionary consumption, where shops have been opening and closing, opening and closing throughout the pandemic, you clearly see a correlation that the more shops were closed, the more, the faster e-commerce was growing, and the other way around. Now, you simply see that now that shops are again reopened, given that Italy is back to all yellow, you know, e-commerce is now at, I mean, it's growing very, very fast. It's 20%, but it's actually less than what it was when shops were closed, when it was growing 40%. So this is clearly an inverse correlation there. Difficult to say what underlying situation is.
My bet would be, obviously, that we have seen a bit more shift from physical commerce to e-commerce. Don't forget that a part of the reason why the government has been driving these cashless initiatives is also to bring people into stores, and so I think the government has taken a very clear decision, and we'll see what the new government will be, so I think we will continue to see shifts towards e-commerce, but clearly not at the levels that we've seen throughout the pandemic, and it's very clear. Now, whenever you reopen the stores, in most of the categories, people are very keen to go back there, even if underlying there is the shift happening.
It really depends on the sector. On the margin expansion, we continue to see the future the way we were seeing it before the pandemic. Our guidance was basically 2019-2021 guidance in the past. It was a midterm guidance. You remember, we will issue a new guidance later in the year, very probably, but we continue to see definitely the possibility to grow EBITDA faster than revenues, and even more so on the back of the M&A that we've done and the cost synergies that we will be able to capture there. Last comment on my side, on your question around the potential for further bolt-on acquisitions from Nets....
Listen, this is a really very small stuff, but also I'll say very nice stuff, because they've done a couple of small acquisition. We're really talking about tens of millions of EUR of cost. One is actually in e-commerce in Finland, where they already have a good position, and they decide to strengthen it. And the second one is actually, I would say a bit more strategic because they are already present in Switzerland, and they bought a local player that is active in terminal and POS management, processing systems, and in general merchant services with a nice base. And it is very strategic because it's very difficult to enter into Switzerland.
That is, as you know, as a very clear incumbent player in place. And, because there is also a terminal technology, terminal certification issue, thanks to this, as a very small acquisition, Nets will be able to push harder in Switzerland, which is a very attractive market because it has high penetration and quite high prices as well.
So, yeah, but just to complete on M&A, I think it's fair to say that all three companies have a pretty full M&A pipeline. It's a sector which is dominated by M&A activity, and there are other companies outside of Italy and Europe that have, you know, merged, undergone antitrust processes which have led to certain assets needing to be sold. And, you know, some of maybe SIA or Nets or Nexi might be interested in those. Nexi itself is currently engaged with Intesa to buy the merchant book, and this will not be the last merchant book I believe to come to market. SIA is present not only in Italy, but outside of Italy, and in the markets in which it's present may be interested in other assets.
So there's a lot going on in Europe and Nexi, Nets, and SIA will be at the heart of this consolidation game. As I said, you know, Paolo and I don't lose any sleep in terms of filling our opportunities pipeline, I would say. With regards to the discussions which SIA has been in with a large Italian bank, that large Italian bank happens to have changed its CEO recently or is about to change its CEO. That hasn't helped, you know, the speed of the discussions, which have been in any event very fruitful, and they were about expanding the relationship, not only extending it and deepening it with that client.
You know, the overall commercial terms, which is, I think, what, Hannes, you were after, are, I think, you know, consistent with normal commercial negotiations, so I try and do more for longer and maybe give you a bit of a discount, so maybe the per unit price of everything I'm selling comes down, but you know, hopefully, and that's the plan, we do more and generate more revenues and in general, generate growth out of that customer relationship, which, by the way, spans beyond Italy. It's not just Italy. It's Italy, Austria, and Germany, and potentially even further, and that, by the way, is in the process of being signed, so it will be completed in the coming days.
Okay, so just to be sure that you don't expect there's particular headwinds, let's say, on pro forma basis this year, because, you know, kind of you are all connected already. Thank you.
I think Paolo said it pretty clearly. By the way, that extension of the contract is, you know, that contract is expires, the original expiry was 2026. So between now and then, very little will happen. And then, you know, there, there's... As I said, I mean, we don't wanna jump the gun here. But I think, I'll go back to Paolo's guidance, which is, or ambition, which is that if things continue the way they are, we feel pretty good about 2021.
Okay. Good luck.
Mm, thanks.
The next question is from Paul Kratz with Jefferies. Please go ahead.
Hi, good afternoon, everyone. A couple of questions from my end. I think when I look at your commentary on installed base revenues in the merchant services and solutions businesses, it would suggest that take rates have actually gone up very significantly in the second half. I mean, could you unpack maybe the factors driving this, and to what extent, you know, you can maintain that take rate? And maybe, you know, just to follow on, the cost dynamics into kind of FY 2021, I mean, how should we think of really fixed costs as you guys define it? You know, nominally, should it be at the same level as 2019, maybe slightly higher?
Then just finally, when we think about expanding the commercial terms with this large Italian bank, should we think of those commercial terms being an expansion of the geographic footprint of that agreement, or more something along the lines of the value chain? Thank you.
Hi, Paul. So quick answer on the third one. Again, it's in the hands of SIA, so it's in their hands, and so we have limited visibility and also actually no influence, direct influence. We understand that there is possibility for geographical expansion. Coming back on your first questions, yes, I mean, if you look at the take rates, the traditional way, take rates have been going up, I would say, throughout the year, and in particular in the second half on merchant services. And I think there are a few clear drivers, as you suggested, that despite the reduction in volumes, the overall customer base went up, number one.
And second, we had, we were able to promote and sell, richer and richer propositions, from the SmartPOS to e-commerce, technology solutions, solutions and so on and so forth, and value-added services in the base, and so on and so forth. And last but not least, you may remember, the mix has been helping us a bit because the net merchant fees that are charged to visitors coming into Italy are normally net of interchange, lower, and therefore the mix, the value mix, has been supporting. So that's about it for the take rates, but you are absolutely right. By the way, some of these,...
This latter part will hopefully, I would say, unwind in the future as the visitors will come back. But obviously, it will come with nice volumes as well, and therefore positive for our total revenues and our growth. Bernardo, you want to comment on costs again?
Yeah, well, I think, you know, there's more of what we've seen in the past in terms of our cost base evolution going forward. If you try and not focus just on the quarter evolution, but look at the overall journey from, you know, the last few years, we have had step changes coming from basically two sources. One has been our IT strategy, which was aimed at insourcing basically processing and changing variable costs into CapEx investment and depreciation. And the second one was M&A, driving cost takeout through duplication of platforms.
So what you're gonna have in 2021, both on a standalone basis, and if we broaden the outlook also to encompass the two companies we're going to be merging with, is more of the same. We're going to have our own IT strategy, which is aimed at insourcing processing costs, and this will, you know, take, you know, full will have full impact, I would say, from next year, not 2021, but we will see some benefit this year. And that's on acquiring volumes, and we've discussed this in the past. We'll have more of that. And then obviously, we will have a great acceleration in terms of this internalization of variable costs through the mergers with SIA in particular, but also with Nets our two processors.
And we also have the M&A benefit of these two transactions, which will help us reduce costs structurally from the takeout of duplication of platforms and general costs. So we'll have both effects. And this just replicates on a larger scale, what's been the story of the evolution of Nexi so far.
That's very clear. Thank you very much, guys.
The next question is from Gianmarco Bonacina with Equita. Please go ahead, sir.
Yes, good afternoon. A couple of questions. Just to follow up on the acquisition of the UBI Banca. So shall we expect this to happen in the first quarter? And is this excluded from your guidance, i.e., if this is going to happen, then maybe there is a little bit of upside from this? I don't know, maybe you can quantify how big is this opportunity. And then the other one on Nets, maybe if you can elaborate a bit on a recent article which highlighted some residual credit risk at Concardis related to the travel sector, in particular, Thomas Cook. Thank you.
Bernard, you want to cover both? Yeah. So UBI is, we've been working on this with Intesa, and it's something we expect to sign in the first quarter. It will never close in the first quarter, given where we are. It will close at some point between now and June, and likely signed before the first quarter results. The guidance Paolo gave earlier, the ambition, you know, is organic, so it does not include any of this, and clearly, we hope to benefit from this acquisition. Now, the perimeter of the deal is still being fine-tuned because of the, you know, the sister transaction, which is the sale by Intesa, effectively, to BPER of 500-odd branches of the former UBI network.
So I can't give you an exact number in terms of the EBITDA we'll be buying, but the terms are basically, you know, extension of the agreement we struck with Intesa on the Intesa book back in June. So it should be an interesting accretion for us. With regards to Germany, thanks for asking the question, by the way, because we had a lot of feedback from the broker community, in particular investors, because of this article, which was published in Germany with regards to Concardis.
Now, I think I will just refer to what we've already published in our November presentation with regards to the Nets transaction, and that is that, the Thomas Cook bankruptcy obviously was very significant, was a very significant event for Concardis, but it was fully disclosed. It is a 2019 event, fully provisioned as well, because in 2020, the final tail of the provisioning was booked in, in Concardis and Nets. And therefore, it was fully discounted at the time of our discussions with Nets and was reflected in the exchange ratio and the, you know, the terms and conditions of our, of our merger. Obviously, this alerted us, you know, to risks involved, and we, you know, diligenced Nets very carefully.
You know, I take this opportunity to remind you again what we stated in the presentation back in November. Nets has made huge progress as a group in terms of reducing its merchant acquiring risk very, very substantially from where it was only a couple of years ago, including you know asking for cash collaterals or in general collaterals against its acquiring exposure and shedding riskier exposures. By the way, there's also some comments to that effect in the Nets presentation which was uploaded yesterday. Just in general, I would say that Germany for us is one of the most exciting areas of future development for Nets. If you look at the performance in general, Nets' performance was good.
I commented on SIA. I think the Nets results, which you can find on their website and in the appendix to our presentation, were also strong. In merchant services, we had, you know, performance which was, you know, slightly down. I think 2% down, which is, you know, better than what we did, notwithstanding the fact that the Nordics and Germany were hard hit in the final quarter of last year from COVID restrictions. And in general, if you look at Germany, I think Concardis is ideally positioned to capture the growth in that market. This is something, a point we made in the presentation back in November, given its, we think, superior product proposition, which is...
I think the winning proposition in that market and the distribution, the distribution structure, which is emancipating itself from the legacy distribution of banks. And this translates into the double-digit growth we've seen in terms of revenues in the last couple of years. Obviously, last year was flat, given the, you know, the COVID impact, but I think better than most of its competitors. And obviously, we're happy to have 100% of that subsidiary, compared to having minority shareholders.
Good. Thank you, Bernardo. So I guess the summary is, no new news really, Gianmarco, thank you for the question. No new news for us, but I think for anybody from that article, and actually very excited about Germany more in general.
The next question is from Alexandre Faure with Exane BNP Paribas. Please go ahead.
Hi, good afternoon. Thanks for including me. I had a couple of questions. One is on the antitrust documentation with SIA. You commented on having filed that in the case of Nets, but when should we expect you to file documentation with antitrust authorities in the context of SIA? And is that at the EU level, or because it's such an Italian play, it would be at the Italian level? So that'd be my first question. A second question is on the app that you mentioned in the slides. Just curious to hear the latest on this, if you're starting to monetize the app, or you're still at the, let's say, installed base building phase. Thank you very much.
Hi, Alexandre. So on antitrust, we will start in the coming very few weeks the conversation with the authority, basically to prepare to do in the pre-filing, if you like, phase. And hopefully, we will be then filing over the next two to three months, depending on how that conversation goes. Based on the shareholder agreements among our future shareholders, the advisors are suggesting that we should be filed with Italian authority, and this is something that we are analyzing in detail.
Obviously, this does not mean that reference market then will be Italy, because all authorities act independently, and therefore, you know, the market can definitely be considered a European market, even if you file into a local authority. On the app, I think we are still in the early stages. As you've seen, I would basically have, by now, almost a million customers, and they're becoming more and more active and with nice volume transactions. We are starting to monetize a bit more this year. And we are positioning this more and more as a proposition for the youth, for physical commerce and e-commerce, more in particular.
So more to come on this topic in the future. It's really important to also realize the fact that the app has a very strategic value for us in terms of being literally an innovation lab, a lab for interacting with very young and technology advanced customers and testing new things. That's only, for example, the place where we have tested the onboarding of the Cashback program, and we are stimulating customers. So there is a value that goes also beyond the pure monetization. And by the way, for us, making sure that customers are staying to card rails, because we should always remember that the app is based on card rails, is strategic.
We start the process, but there is more value beyond the pure monetization, direct monetization.
Got it. Thank you very much.
Mr. Bertoluzzo, gentlemen, there are no more questions registered at this time.
So thank you for attending this call. Sorry for being a bit longer than expected. It lasted a couple of hours, but I really wanted to be able to cover all your questions. Please come back to us in the coming days. I'm sure we'll meet and talk with many of you in different setups. Again, the key messages of the day are strong performance despite COVID, despite second wave COVID in 2020. Very positive output when it comes to evolutionary customer behaviors in future, further shift from cash to digital. And last but not least, very excited in accelerating the transformation of the company from an Italian leader to a European leader, and progressing well on that plan as of today.
So thank you again, and enjoy the rest of the day. See you soon.