Thank you all for standing by. Welcome to today's Worldline Q1 Revenue Conference Call. Our presentation for today will be followed by a question-and-answer session. Please be advised the call is being recorded. I would now like to hand the call over to the speaker, Chairman and CEO of the group, Mr. Gilles Grapinet.
Many thanks, operator. Ladies and gentlemen, good morning. This is Gilles Grapinet speaking. Thank you for attending this Worldline conference call today on our first quarter 2021 revenue. As usual, I'm going to share this presentation with our Deputy CEO, Marc-Henri Desportes, and with Eric Heurtaux, our Group CFO. As you can see, during the first quarter, we faced, as anticipated in our central scenario, a third wave of COVID, leading to new restrictions implemented in most of our key countries. Regardless, Worldline has shown a strong resilience with a limited 9% organic decline, which is notable compared to a very strong start of the year in 2020 with both Worldline and Ingenico growing double digits. This resilience in Q1 2021 clearly reflects the increased share of our online activities and the acceleration of the cashless trends triggered by the pandemic.
The evolution of payment transaction volumes is also showing an improvement at the very end of the first quarter, consistent with the expected strong growth acceleration during the second quarter. This trend is currently supported by the ease of national restriction roadmaps and, more than ever, by the rollout of vaccination campaigns to reach the collective immunity in the course of the summer 2021 as per the official targets of European governments. I'm pleased to report that the Ingenico integration is progressing at a rapid pace, allowing us to already secure a vast majority of the expected synergies in 2021, supporting our annual objective of circa 200 basis points profitability improvements. In parallel, we pursue the execution of our strategic roadmap with the expected completion in 2021 of the strategic review of the payment terminal business as planned, while keeping, as usual, a maximum focus on new consolidation opportunities.
Overall, I am very pleased to report that this first quarter is fully in line operationally and strategically with the expected trajectory presented in February 2021, and we confirm, of course, our full-year guidance. I give the floor now to Marc-Henri to give you more color on the current health and business environment and how we see the coming quarters.
Thank you, Gilles. Good morning to you all. There is clearly no precedent of such a crisis on our transaction-based activity. You can see on the chart the now three consecutive waves of various restrictions impacting massive merchants and consumers. Looking at it, starting from the left, you can observe that we enjoyed a very strong performance in January and February last year, brutally interrupted by the first COVID wave in March 2020, triggered by strict lockdown rules in our core countries and impacting particularly our second quarter. You can see as well, end of Q2 and in Q3, the strong sensitivity of transaction volumes and their ability to recover quickly as soon as stores are even partially reopened, despite a certain number of restrictions remaining in place at that time.
Since then, we have experienced two consecutive waves of government measures, with the first one in Q4 2020, which included still a flexibility during the Christmas period that allowed us to deliver a decent fourth quarter despite the overall context. The second one, beginning of 2021, a re-generalization of tighter restrictions in our core countries, driving this quarter to be as expected between Q2 and Q4 2020. More importantly, I would like to underline two points. First, we have been less impacted by the last two waves than by the first one, thanks to an increased online exposure, allowing us to capture growth opportunity and the acceleration from cash to card, driven by an improved usage of contactless payment. Second, the beginning of restrictions easing seen at the end of Q1 allowed us to be back to growth in the month of March.
Maybe two data points to help you see the acceleration. In terms of number of transactions, we were up 12% in March, with online up strong double digits and in stores up mid-single digits. In January and February, we were down high single digits overall, but with in-store transactions down double digits. My most important takeaway from this slide is a strong benefit in terms of resilience of the new group profile post-Ingenico, with most significant online exposure, which is now three times bigger than the average reported for Worldline before the acquisition. Let's have a look at slide six on the current and expected health situation in Worldline core markets. In the first two columns, you can see the lockdown situation in our core European countries during the first quarter.
Most important part of the table is on the right-hand side, showing the current and expected status of reopenings as of today based on plans implemented by European governments. Except some markets such as France and Belgium, where stricter restrictions came into force in March, we have seen more relaxed measures across Europe, as Austria and Switzerland, and at the very end of the quarter in Germany, with end of lockdowns and at least partial reopening of non-essential retail. This status is fully in line with our central scenario of progressive lifting of restriction, on which I will comment later on in the presentation. This positive trend is strengthened by the acceleration of vaccination campaigns, confirming our scenario of further progressive reopening, as shown on slide seven. Talking about vaccination campaigns, here are the latest official data points in key European countries.
As of today, circa 18% of the population in our key countries is already vaccinated. Based on the vaccination campaigns announced and observed, we see a strong acceleration that is planned to be over the coming four months to reach 60% - 70% of the population vaccinated by summer 2021, reaching the herd immunity. This vaccination ramp-up will allow progressive acceleration in the course of Q2, and a more normalized environment hopefully in H2. As for the partial lifting of restriction, this trend is fully in line and embedded into our central scenario. As I mentioned, all the recent announcements reconfirm our central scenario, assuming a gradual recovery along the year. As a reminder, our scenario is based on the following assumptions.
For the first half 2021, we expect to be flat to slightly negative in terms of organic performance, driven by several government domestic restriction during Q1, including lockdowns of non-essential merchants, curfews, and border restriction, with a Q1 performance as a crossroad between Q2 and Q4 2020, which is in line with our publication today. Partial relief of restriction in the course of H1 2021, in particular in Q2. No significant intra-European travels, no intercontinental travels, and ramp-up of vaccination campaigns. More importantly, for the second half of the year 2021, we expect to re-accelerate towards the circa double-digit organic growth based on the ease of domestic restriction with end of lockdowns for non-essential merchants, end of curfews, and borders restrictions. Intra-European travels fully allowed, and progressive return to normal level of travel flows in high European travel flows, and no significant intercontinental travels yet.
Once again, it's just a reminder of what we already shared with you of some first scenario, and so far confirmed by the first four months of 2021 and supporting the full-year guidance that Gilles will remind you in the next slide.
Many thanks, Marc-Henri. Indeed, our resilient Q1 2021 in such a context and the ongoing recovery that we observe in transaction volumes at the end of March, as per our plan, allows us to fully confirm our 2021 guidance based on the scenario of the previous page. I remember the guidance, at least a mid-single digit revenue organic growth for the full year 2021, an OMDA margin improvement by circa 200 basis points compared to 2020 pro forma margin of 23.9%, including Ingenico on a full-year basis. Finally, an OMDA conversion rate into free cash flow of circa 50%. Now, Eric will take you through Q1 performance by activity before I come back for the conclusion.
Thank you, Gilles. Good morning to all of you. Let me start with an overview of our revenue performance in Q1 2021. During the first quarter of 2021, Worldline's revenue reached EUR 1.08 billion, with revenue impacted by severe restriction implemented in our key countries, as already mentioned by Marc-Henri. Consequently, as expected, organic revenue decline for the first quarter was -9%, rather resilient in such a context. The most important point is the fading of the quarter. First, I remind you that both Worldline and Ingenico experienced last year a very strong start of the month of January and February 2020, a double-digit, after, the month of March impacted by the strict lockdown put in place, as all of you know. With high comparison basis, coupled with the new restrictions in Q1 2021, has obviously impacted our activity.
The important message here is the inflection point we have seen in March. All our transaction-based activities were back to positive organic growth in March. This acceleration fully confirms the expected trend we foresee for the entire year 2021 and highlights the strongly bound capacity of Worldline transaction activities when we have the relaxation of restrictions. Let me now put these numbers by business line. Starting with Merchant Services activities, revenue reached EUR 517 million, representing an organic decline by 8.7%. Most of the decrease was in commercial acquiring, while payment acceptance, both online and in store, as well as digital services, showed more resilience in the current COVID-19 context.
Digging into more details to our activity, first, on the commercial acquiring side, we experienced a strong impact from the new COVID-19 measure in our key countries, mainly in the German and Swiss market, with a particular low high-value transaction and DCC payments. Moving to the payment acceptance, our activity was quite stable versus last year, despite the lower activity on the SMB acceptance.
The main positive drivers were good dynamism on the large retailer transaction volumes, mainly in France and Germany, as well as our online activities continuing to grow double digits, excluding travel, having in mind that travel activities were still strong in Q1 2020, creating a high comparison basis. Last, with digital services, we have seen a steady performance with a good trend in our key countries such as Belgium or Switzerland, driven by large retailers, while SMBs remained under pressure during the first quarter due to severe restriction implemented in Germany, Belgium, and the Netherlands. Over the quarter, commercial activity remains strong. Notably, we have renewed in a competitive process an important contract with Total.
The main pillar of this success are our ability to provide a competitive pricing for the acquiring transactions in Europe markets such as Benelux, France, and Germany, a solution offering enhanced and globalized reporting and system connectivity, and a specific customization to answer customer needs. The flexibility of our solution, combining reach, scale, and customization, is clearly a key differentiating factor in such merchant RFPs. Now moving to financial services. Financial services revenue reached EUR 216 million, representing an organic decline by 2.4%. The activity showed an overall resilience with a progressive improvement throughout the quarter. Regarding issuing processing activities, we have experienced lower volumes related to COVID-19 on a high comparison basis. This effect has been partially compensated by the ramp-up of new projects, notably Comdirect. Our acquiring processing activity has been impacted by missing transactions due to the restriction in our key countries.
It has been partially compensated by the start of the ramp phase in new contract signed. This latest effect should continue to contribute in 2021. On the other hand, both digital banking and account payment have grown significantly in this quarter. On digital banking side, we have seen a strong growth of the activity across all geographies, driven by higher authentication volumes related to the growth acceleration on online transaction and higher volumes of orders processed on Worldline e-brokerage platform. To end with account payment activities, the performance has been solid, benefiting from the ongoing ramp-up of a UniCredit contract combined with significant project activities. Regarding the commercial activity, one of the key contracts to mention is the one with Comdirect. Following many years of successful partnership, we have extended by five years the existing service agreement with Comdirect, the Commerz bank brand.
We will process the bank's new Visa debit card via our next-gen API-based issuing service. On top, the bank has been seduced by our catalog of value-added services, such as the possibility to offer instantaneously a virtual card to its customer. This quarter highlights once again the highly resilient profile of FS division, which could face three waves of COVID, never exceeding minus 5% organic evolution. Regarding TSS, revenue reached EUR 266 million, representing an organic decline of 16.5% in a challenging environment adversely impacted by COVID-19 consequences, as anticipated. In this context, we naturally stayed focused on the cost management, which combined with a favorable geographical mix allowed to preserve margin profile. Let me now cover the performance per region. Regarding EMEA, Western Europe, particularly France, U.K., and DACH, suffered from lockdowns implemented in the first quarter as expected.
In Eastern Europe, we have been impacted mainly by several order delays that should come back in the coming quarters. Middle East and Africa suffered from high comparison basis, but the pipeline of projects remains strong, offering future growth opportunities. In APAC, the market offered an overall good traction with a strong momentum in Australia with our main customer, a resilient performance in Southeast Asia. The only market suffering is China, impacted by a lack of market dynamism and a high comparison basis related to half of projects delivered in Q1 2020. Latin America has shown a strong performance with the solid momentum of project execution with key customers in Brazil and market share gains in a new equipment phase in other countries such as Argentina, Chile, and Peru.
In North America, despite the strong pipeline, the quarter was soft due to a high comparison basis, difficulties of our clients to deploy Terminals in the first two months of the year. We expect a sequential increase of the activity for the coming quarters. During the first quarter of the year, Terminal Solutions & Services continued to strengthen its Payments Platform as a Service, PPaaS, with the onboarding of 16 foundational partners to co-design and test the solution. These include leading acquirers, global PSPs, payment players, and fintechs. It's a new step in the business model transformational journey of TSS to move toward a more recurring revenue-based activity. Let me conclude this part with MTS. Revenue reached EUR 82 million, representing a quasi-stability, thanks to a new project contribution in the quarter. By division, the main highlights were as follows.
Starting with trusted digitization, the activity has been impacted by the end of specific contracts, but we have been able to partially offset this effect by new projects and additional volumes coming from contracts, new and existing, such as tax collection services in LATAM region. E-ticketing activities have been obviously impacted at the beginning of the quarter, suffering from the exposure of transportation in our key countries. The situation progressively recovered at the end of the quarter on the back of new project development in France and better activity in the U.K. Lastly, on the e-consumer and mobility, we have experienced a steady performance with a strong momentum in contact solution, with increased volume and a strong dynamic in e-health activities in France regarding consumer cloud solutions and new projects in connected living and mobility solutions.
To end with MTS commercial activity over the quarter, we have signed amongst over a new contract with the Grand Est region in France. We have been chosen to equip the region with the last e-ticketing generation platform. This solution will enable the harmonization of mobile ticketing assets throughout the region and will facilitate intermodality between the various regional transport networks. In the long term, this ticket model could be used to access other services provided by the region and its partner cities, such as e-administration of public services. Now let me hand over to Gilles to conclude.
Many thanks, Eric. Before concluding this presentation, I would like to take advantage of this call to highlight the successful completion of our TRUST 2020 five-year CSR program, which has been recently reported within our universal registration document, which was filed last week. Since our IPO in 2014, and in parallel, as you know, to a very robust value creation for our shareholders, Worldline has indeed committed to an ambitious corporate social responsibility approach. The resulting five-year action plan, TRUST 2020, was launched in 2015 and fully embedded in the group's corporate strategy. After the materiality assessment we did at the time covered multiple dimensions like business, people, value chain analytics, and the environment, of course. TRUST 2020 has proven to be a very powerful framework, mobilizing the whole organization around the 13 measured objectives to be achieved by 2020.
As a result, we have delivered successfully on most of our ambitions, and correspondingly, Worldline is now seen as a CSR leader in the field of payment and technology, awarded by the leading non-financial rating agencies such as GRI, CDP, EcoVadis, Vigeo, or Dow Jones, amongst many others. Building on this strong momentum, strengthened in 2020 by the adoption of the company sense of purpose by our shareholders, Worldline has been designing its new TRUST 2025 program, post-Ingenico acquisition. It aims to open a new chapter for the company's CSR journey with the same level of ambition to secure further long-term value creation for all stakeholders by driving new long-term transformation actions as customer satisfaction and their long-term commitment to source from Worldline, attractiveness and retention for our people and for talents.
Positive contribution to climate change with carbon neutrality objectives, sustainable practice with our suppliers, and deeper engagement with local communities, in particular with payment services dedicated to charities. This new TRUST 2025 CSR program will, of course, be presented to you more in detail in our projected Investor Day in H2 2021. Now, let's conclude this presentation by restating our key priorities for 2021. First, from an organic standpoint and beyond reaching our guidance, we will focus on delivering the strongest possible acceleration of our growth rate as soon as of Q2, upon the progressive normalization of the health situation. Of course, as usual, we will focus on the quickest possible execution of our synergy roadmap, already largely secured for the objective of the Ingenico synergy in 2021.
Second, we will keep a very strong focus on executing our strategic initiatives within particular the completion as planned this year of the currently ongoing strategic review of the payment terminal activities, which is very well on track, and the continuation of our scale and reach enhancement through further consolidation opportunities, notably given the favorable context created by numerous initiatives currently taken by European banks in terms of contemplated divestment of their payment activity. Thank you very much for your attention. With Marc-Henri and Eric, we now will be happy to take your questions.
Thank you. We'll now take our question. The first question is from the line of James Goodman from Barclays.
James, thanks very much for taking my questions. Just two, please. First one, just on the guidance, mainly for the first half of the year. Just in terms of the reiteration there of flat to down slightly. Given your comments around the March run rate, the sort of regions opening up, given the comp effect mathematically in Q2, I find it hard not to look for double-digit growth in the second quarter, so bringing you maybe into positive territory in the first half. Just wondered if you could address that really, anything I'm not thinking about there in terms of the Q2 likely performance. Then second question, just on Terminals. There was a press article a couple of days ago, again, commenting on the process, valuation, and various other things.
Just wondered if you could add a bit of context to that, and maybe you could recap a little bit, the latest thoughts around protecting, I guess, what will be a very important supplier relationship to Worldline, in the event that you pursue that course of action. Thank you.
Hi, James. Many thanks for all your questions. Maybe I will start on the first one. I will also comment a little bit on your question regarding TSS. Well, I see where you are going on the Q2. Indeed, you're right. Q1 is fully in line with the expected trajectory, in particular, as you noted, with the very solid recovery of the revenue and the transaction volumes at the end of the quarter. All this is totally confirming our H1 view of circa flat performance. With all division, we expect to be in positive territory, including potentially even TSS. It's true that the final result may depend a little bit on the speed of some relaxations here and there. It's hard for us to forecast. There could be a favorable scenario indeed that could bring us even better than what we see.
For the time being, we still stay on the trend that has been described by Marc-Henri sooner of what we said for the H1. Of course, some good news may happen during the course of Q2. Let's see. Regarding TSS, as you know, we don't comment on rumors coming in such circumstances from all types of media. What I can say, nonetheless, is that definitely, we are progressing extremely well on the strategic review, and we've been exploring all the potential options. Definitely what I cannot deny is that we came, in particular, amongst many other options, to observe that probably TSS could be an attractive asset also for financial sponsor. So as we are committed to explore the feasibility of all options, we cannot exclude that some types of rumors will pursue popping up. This is the only comment I could do.
What we want to secure, in any case, is the best possible future for TSS in the interest of all stakeholders, Worldline, the business, the employee, the customers, and we will pursue exploring all the relevant options. What we are pleased with is to see the level of attention that the strategic review has attracted around us. Regarding the relationship, which has been a deep work done by the strategic review, indeed, to project ourselves in a world where TSS would no longer be controlled by the company. It is important indeed, we have a clean base to start a new relationship with this major supplier. Maybe, Marc-Henri, you can talk about it.
It is clearly in place today as an intra-group relationship and a key element to secure for the future for both parties. Clearly, we rely on this hardware supply and the innovation, the quality of the work between the two teams to provide the best possible combination to our customers. Obviously, TSS as well needs these very, very important customers driving huge volumes and leading on the market. The work has been done to make sure that this is secured, this is stabilized, this can last and be a long-term, value-building relationship for both parties. It took quite some energy to make sure that documentation support that beyond the quality of the people relationship. That is a strong basis of the strategic review, no doubt.
To be ready to execute fast and also to give visibility and transparency to the potential long-term investor that would take over the business if we go in that direction in the end.
Many thanks.
Our next question is from the line of Josh Levine from Autonomous Research. You may ask your question.
Good morning. I have two questions. The first, you achieved 2/3 of your 2021 Ingenico synergies target in the first quarter. Does that mean you may beat the original synergy guidance, or did you expect it was going to be front-loaded this year? On PAYONE, has there been a change to the degree which the Sparkassen are distributing your payment products and services versus Concardis' payment products and services? Thank you.
Hi, Josh. Good to hear you. Trust you well. Lucky guy, you live in a country which is ahead of Europe in terms of relaxation measures as far as I know. I give the floor for your first question to Eric, and then probably Marc-Henri can discuss a bit around PAYONE.
Hi, Josh. Yes, you're right. We are very pleased with the progress so far of the synergy plan. We have, after three months, secured already two-third of the synergies. For the year, it means that we still need a few additional actions to deliver the last third of the synergies expected for the year. Not the two-third have already materialized in Q1. We are really on a good track. That's what I can confirm to you at this point in time. That's why we thought interesting to share this data point with you all. You know us, basically. We will not over-commit. It's very early in the year, but it's promising. We always apply the same approach. We try to deliver fast. That's our motto, that's our signature. Usually, when we deliver fast, ultimately, we get more synergies.
That's what we will be aiming for this time again, that's a proven recipe, and we expect to apply it again.
Yeah. I will continue on this work of delivering the synergy. I can tell you, we see the teams extremely motivated to demonstrate that this fast spirit is everywhere in the company. There is a kind of internal competition to demonstrate that you are the fastest to the target. We keep this. Also, the momentum of the company, the morals, despite personal lockdowns of the people with this big energy and momentum around the synergy, that's very supportive to building our future. Now, coming to the relationship with the Sparkassen. Yes, indeed, it's excellent.
Given their interest into PAYONE and their very strong support to the project, they have put more and more emphasis, in particular over the last years and months, into making sure that all the individual branches, the network, the sub-banks inside the saving bank's group, are equipped in terms of online tools, process, relationship, trainings, to push the solutions of PAYONE. It is an accelerator for commercial performance. We see right now it is a bit hidden by the low level of transaction. In Germany, we are insisting about the lockdown situation to study business, and Germany is the big case of the Q1, with having been under extremely strict rules and lockdowns, I would say, beyond what was seen before through 2020 during Q1.
Ending at the very end of the quarter, and the very last days, the last week of the quarter has shown that when things ease in Germany, it's a big game changer. Yes, the Sparkassen relationship is improving. It's developing fast, and will support an acceleration of the sales and top-line momentum.
Thank you very much.
Our next question, it's from the line of Hannes Leitner from UBS. You may ask your question.
Good morning, everyone. I got also a couple of questions. The first one is on Terminals. Just in regards to put your comment in context of concluding by year-end, could you talk a little bit about the timing? If something gets announced, in what time frame could you be closing the business, as you have already legally separated the businesses? Just in terms of EBITDA, can you maybe scope what is in the current scope, and is there a certain range because you still have different scenarios running there? Would there be an internal re-cost allocation if you completely divest the business? Just a short follow-up afterwards.
Hello, Hannes. Good morning. I will take the first one, Eric will take the second one on the relevant EBITDA scope. Regarding the strategic review timing, as you remember, we launched it as soon as the closing. We executed very seriously to make sure that we can actually come after the potential signing would be done to a relatively fast closing without too many things to be further worked around. For example, it's why it was so important prepare properly the future relationship between Merchant Services in Worldline and TSS. This is off the table for business signing and closing. With that in mind, our ideal scenario would be to start 2022, ideally, in the new setup, whatever it could be. It may look ambitious.
We believe it could be feasible, depending on the scenarios that would be retained by the board in the end, in particular, of course, for scenarios that would imply a divestment of a controlling stake in the TSS business. It is still what we are after, the timeline has been built with that overall objective in mind. Of course, it may probably also, depending on multiple factors, it may move a little bit by a few months, we are in this mindset to try to make it in 2021, to start 2022 on a new setup on both sides. Eric?
The scope and EBITDA. The scope is the Terminal activity for both Worldline and Ingenico. In terms of EBITDA, you should expect probably something between EUR 300 million-EUR 350 million. This, of course, will be finalized with any potential buyer if we decide to sell. There is always a bit of tuning in the last mile as you know. That's probably the right order of magnitude. To give you another data point, also a rough order of magnitude, you should expect for this unit probably circa 25% of EBITDA margin.
Okay, thank you. Then just a topic here. I think something, a topic or theme is alternative payment methods. Maybe you can remind us what is the typically different, let's say, profitability rates between payment methods if you do Visa, Mastercard, Amex, PayPal, or for example, direct accounts to account payments or PSD2 related direct online banking payments, et cetera. Thank you.
Yeah. Hannes, this is probably one of the most difficult question of the industry right now, and clearly there is no stable answer to it because it's in constant evolution. A payments mix pricing model is a choice made by every PSP, based on their willingness to go fast on the market, fast or slow, much more than the technical way it is operated.
It's not because an account to account payment is settled by a central ACH infrastructure that it doesn't need to be known by a consumer, accepted by a merchant, integrated in a consistent reporting. We have situation, typically, I can think about the Chinese payment means where we make more monies than on the traditional card schemes. You have a huge diversity of situations. Overall, what remains a driver of the growth and the relevance of our positioning is to serve the merchant in handling this diversity. What the merchant hates is losing a sale. Merchants are there to sell. They want to serve each and every customer, whatever its preference in terms of payment means. They want to know how much they sold.
They want to know their treasury level, and they want ideally to get their treasury as soon as possible, into their account. That is the job of a merchant service provider, to provide a consistent solutions to all these needs, accept all kind of payments methods, be efficient, provide the right reporting, make sure that cash flows quickly and handle exceptions, incidents in the most professional way. As we I think shared with you already a few times, we believe that diversity in this moment and likely to continue or even to develop in the coming months and years is a strong driver of our growth and of the relevance of our positioning on the market.
Great. Thank you.
Thank you. The next one, it's from the line of Mohammed Moawalla from Goldman Sachs.
Great. Thank you very much. Hi, Gilles, Marc-Henri, and Eric. I had two questions. One, you sort of sounded more optimistic in terms of your sort of exit rates around March. Could you give us a sense of how April has been trending in terms of sort of the pace of the acceleration? I'm cognizant that the comparisons now really start to ease up, that drive your kind of view around a kind of flattish H1. As we think about the back half of the year, you've clearly excluded travel and tourism, but is there any other factors that potentially could paint to a more optimistic scenario around the growth recovery that we're missing, particularly in terms of revenue synergies from the Ingenico side? Secondly, any update on M&A?
I know you've talked about Terminals a lot. If you sort of come up with a announcement around Terminals, could you update us on the discussions you're having? I know there was something on the wires earlier this morning that you're increasingly still being approached by banks as an industrial vendor. That would be helpful in terms of how quickly you can transition on the next M&A moves. Thank you.
Sure, Mo. Good morning. Marc-Henri, maybe on the first one?
On the momentum, what we saw beginning of April was very much a continuation at the level at the end of March, remaining strong compared to the previous period. Not yet an acceleration further, remaining strong like at the end of March, because there was no new lifting of restriction happening. What we see is extremely reactive to any lifting of restriction, and this gives us a good visibility for the period to come, as we say, at this very solid and decent level. We are approved that with what we shared with you on the vaccination campaign progress and the rest, all this very tight situation of the core European countries is getting to be behind us. Maybe to your question of what are the upsides that could come as a positive.
There is one we did not mention, is the accumulated hundreds of billions of saving in Continental Europe. The particularity of this Continental Europe is maybe very restrictive measures when it comes to freedom to operate, also a very protective measure.
When it comes to business and people, to secure that their revenues are not impacted. Of course, a lot of public debt has been generated, but somehow the private savings have been preserved. People have accumulated a huge amount of unspent money. Consumers may decide to mobilize this money at a much faster pace, and that is the external factor on the context data, on which we miss a bit of knowledge because this was not so strong and so much accumulated in Q3 last year, and this may come as an accelerator with time.
That's the outside part, of course. There is inside, all the energy that we have accumulated internally in terms of capacity to cross-sell and deliver the revenue synergies within Ingenico, with a better product mix, a better combination of teams, and that will be potentially an accelerator as well.
Regarding M&A, what is striking these days, over the last recent months, is that more and more banks, including leading domestic players in their home markets, are accelerating somehow the strategic review that they do on their payment activities. It covers two dimensions. The first one is on the merchant services business, where clearly there are more and more opportunities recently of potential sale or partnership or JVs along the merchant acquiring related activities of banks who are recognizing that they lack scale, sometimes technologies, sometimes just the focus on this business, given the fact that it is more and more populated by large pure players in Europe, and that partnership makes absolute sense in the nature of the ANZ Worldline joint venture that we announced at the end of 2020. We believe this is winning for all.
Not always a JV, by the way, but always at least a commercial alliance and a distribution agreement. This is really one of the trends we see in more and more countries. The second one is related to relatively transformative thinking around the processing factories of payments. Some banks are really questioning the contribution to their cost income ratios of the way they operate their payments. It is more cost driven than about accelerating growth for merchant distribution. It connects probably to the overall environment in which large universal banks are operating these days, and which is clearly driving the strategic agenda of some of these to really reconsider their level of insourcing versus outsourcing. It can also echo sometimes some M&A dimension or feed a potential longer term pipeline of large processing opportunities in the coming years.
Not everything should be short term, to be clear. Clearly we are entertaining sometime a very interesting discussion with banks that are clearly opening up a brand new array of thinking on their strategic options to rethink the way they should distribute payments, and consequently also partner in producing the right level on cost on their payment means and payment products and payment solutions. It is really, I think, something that we will need to further observe in the coming months. I must say that the last months have been pretty interesting from that standpoint. I think also preparing very well a new wave of consolidation of payment volume in Europe, whether through M&A or through large outsourcing in the same nature of the one we discussed around Commerz and UniCredit over the recent years.
Okay. I just had one for Eric on the synergies. Can I just reconfirm, there was not a pull forward, but rather, you're realizing the synergies quicker and there could be the numbers, the EUR 66 million could still be a relatively conservative estimate for the year?
That would be my assumption and my hope. That around this objective that we are all pushing the team, that are already quite motivated, as Marc-Henri said. Indeed, we try to secure further 66, but that's really well on track. Potentially doing a bit more or doing a bit faster even some of the synergies that could have been done in 2022, so that it can bring positive impact earlier. Yeah.
Great. Thank you, gentlemen.
Thank you. The next question is from the line of Stéphane Houri from ODDO.
Yes, hello. Good morning, everyone. I have two questions. The first one is a little bit long-term, or not so much in a way, because if you try to imagine the group when you will have solved the TSS issue, or if we can call it like that, what is the profile you see for the group in term of growth and EBITDA margin, let's say starting in 2022? 2021 is obviously not a normal year. That's the first question. The second question is, if you could give some details about your online business today, how it is growing, if your traditional customer has changed a little bit the way they think about it, and if they want to accelerate. That's basically my question. Thank you.
Hi, Stéphane. Nice try, Stéphane, but rendezvous in our future for the first question in our future Capital Market Day, if you don't mind, to talk about the medium-term perspective of the group with or without TSS on board. It will, of course, depend on the outcome of the strategic review. Indeed, it should be an interesting moment for you all. Really, as you know, for us, TSS is not an issue, as you call it. TSS is a great asset, having great teams, a superb transformation ahead, and we just want to make sure what is the best home for driving this business to its next journey of world leadership in the future secure, interactive, cloud-based payment devices of tomorrow. This said, regarding e-commerce and online, indeed, we see interesting evolution, particularly post the Ingenico acquisition, and maybe Marc-Henri, he can give you some more colors here.
Yeah. Maybe just to insist that as a starting point, e-com is indeed growing strongly since the end of Q1. In particular, as we don't have travel anymore in the comparison basis towards last year. Ingenico, in particular, was strong in the travel sector, and that weighted a bit on the performance of this business during the year 2020. This is behind us, and this is just now a full upside when travel's coming back. As you see in our central scenario, very progressively in Europe and intercontinental, we'll need to wait for the following years. What I can say on in-store, on online and its acceleration, firstly, the quality and the scope of the offering that now combining Worldline and Ingenico is much bigger, and we can offer that to both portfolio in a cross-selling logic.
More importantly, I think what we see accelerating very fast is the fact that there is no in-store merchants that do not think about having an online solution. For the bigger ones, a fully integrated in-store and online solution that allow to have a very consistent experience, a real omni-channel experience where you can start online, finish in-store, move from a remote to in-store experience with a mix of click and collect or some in-store combination. The need for a seamless world in which this dimension in-store and online are not any more separated, but tightly related, is the new trend in the industry. That's very good for us who have such an in-store position and online capabilities, because we are perfectly positioned to capture this evolution of the market.
Which largely was existing before COVID, but the COVID has accelerated it, because now merchants see a situation when you have ups and downs, people tend to foresee the future, with events looks like today, that may reoccur, and they want to keep fully flexible and have the ability to serve their customer in whatever way. This need of combining online with in-store, which is not the new normal, the new must have for everyone, is a very interesting accelerator of the momentum, and we are putting a lot of emphasis and energy on this dimension in MS right now.
Okay. Sorry, yes. The word issue was not appropriate, of course. I've got a short follow-up on online. When you say integrated offer, does it mean that you think about integrating services like buy now, pay later or things like that? You just continue to outsource these kind of services?
Today, there are a lot of partners that are very dynamic on this market. Our first move is clearly to offer the big names to the merchants. Buy now, pay later is primarily a branded concept targeting consumers. We think it's important, we are not a B2C company, and that we offer this kind of solution, and we allow the merchants to accept this kind of solution and to serve their consumers. Of course, all options are quite open. It's quite a new market, I'm not saying that more B2B solution could not be envisaged. The first move and the first priority is to ensure that big brand names are available to all our merchants.
Okay. Thank you very much.
Thank you. The next question is from the line of Alexander Faure from Exane. Thank you.
Good morning. Thanks for squeezing me in. We've got three questions. The first one is more of a housekeeping one. Wondering if you could give us a sense of the FX impact we should expect for the rest of the year, it's getting harder to model out FX now that you've got Terminals. That'd be helpful. My questions, one would be on the order book and pipeline in Financial Services. I know, Gilles, you commented on potential large deals just now in outsourcing. Sometimes this takes a little while, wondering perhaps smaller, medium-sized deals, what we might expect in the coming months and quarters. My second question is a bit longer-term. Curious to hear how you're thinking of a potential digital euro. Would you view this as a way to perhaps displace cash a little faster and therefore upside to Worldline?
Quite the opposite, some risk of putting pressure on take rates across all e-payment methods? That's it. Thank you very much.
Okay. Eric speaking. I will take the first question, which is definitely not an easy one. You know that FX is quite hard to predict. What I would say is that we are particularly sensitive to the evolution of euro to dollar. That's probably the primary KPI you should consider if you want to model based on your anticipation of this evolution. Also sensitive to the evolution of the Latin American currencies, which may evolve very fast. You know, still there is this hyperinflation in Argentina, the reais in Brazil is also quite volatile. I would say that, probably, in this region that you should look for the various impact. Last, I would say the Swiss franc, which is also significant for us. With this, you have a good idea of the currencies that are impacting us.
The first two, mostly for TSS, which is the division which is the most impacted. The last one, the Swiss franc, being more connected with Merchant Services. In terms of absolute value, I will not bet, because that's definitely not something I usually do. We give objectives and guidance excluding the FX rate, because this is not something under our control. Just to give you a number, in Q1 it has been EUR 31 million, the FX impact, which impacted negatively the reported number from last year through the appreciation of EUR. Two-thirds of it being a bit more even than two-thirds being in TSS division.
Thank you, Eric. Regarding the pipeline in FS, what we can say is that end of March, the pipeline of commercial opportunities is at a very good level in FS. The quality of the pipeline at this point in time, the one on which we actually work daily with the hope to close in the coming quarters, is made also of very good, many middle-sized opportunities. Larger deals, we have learned that from the past, are taking a long time to close always. What is really interesting these days is to see that banks are really looking at this issue from a strategic and sometimes even from a top management standpoint with external advisory firms helping them to drive literally new business cases. This is more, for me, a medium-term relay of strong growth for FS.
When such strategic decision could be proven right in certain European banks, then moved to the tender phase or the bilateral discussion with the most obvious supplier that, for example, Worldline can be. What is really great is to make sure that, and what we will monitor in 2020, is the speed at which this strategic review of the make or buy dilemma is taking place in some of the large European banks. Of course, we hope to keep you updated of our latest assessment of the market opportunities at the time of our financial communication with our capital market day later in H2. Coming to digital euro, to make it short, because it is still a project, I think the most obvious use case would be to accelerate the cash displacement of particular categories of population of certain use cases.
Today, the two hottest things that are looked after are the unbanked or the people that have difficult access to traditional banking networks. Like minor, migrants, the poorest part of our population, which are heavy cash users, but they need, nonetheless, now to be able to spend digitally. They don't have a bank account, nor a credit card, but they need, nonetheless, to buy things online, to order streaming services or whatever, to buy their tickets online. Digital euro could be a way to actually solve the cash issue on this front. The second one is the moment in our lives where we have no connectivity. When we are traveling underground and there is a limited connectivity or in white spots in Europe, where basically you could be deprived of your ability to pay because of the lack of connectivity.
A digital euro, that would be a type of a prepaid wallet with a certain amount of money encapsulated, and then you reconnect when you get back online with your bank account to do the resynchronization could be also a valid use case. This is the current state of thinking. Let's see where it goes. There may be other use cases, but we don't see that at all as a threat, rather than an opportunity to accelerate the long tail of cash. Once we will get well above 50% of cashless penetration in most of the countries, there will be still a long tail of cash usage to displace, and digital euro could play a part here.
Understood. Thank you very much.
I think it is now the end of this hour. Guys, many thanks for your attendance this morning. It is still a bizarre moment in time, but we saw now, we see very clearly some solid light at the end of this tunnel and for Worldline, a strong return to growth as soon as of Q2. I can't wait to be with you at the end of the month of July to see the world starting to be normal again in most of our countries, and big volumes flowing on our platform. In between, stay safe, get vaccine, and see you soon.
Thank you. That concludes our conference for today. You may all disconnect. Thank you all for participating.