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SafeCharge upgraded by Barclays after stellar first half performance

Barclays said SafeCharge's strategy to migrate the portfolio to lower risk and larger customers was paying off
SafeCharge upgraded by Barclays after stellar first half performance
SafeCharge's payment technology is used by companies such as Paddy Power Betfair and Domino’s Pizza

Shares in SafeCharge International PLC (LON:SCH) edged up on Friday after the online secure payments group's stock was upgraded by Barclays following strong first-half profit growth, fuelled by new customer wins and a growing sales pipeline.

SafeCharge, whose technology is used by companies such as Paddy Power Betfair (LON:PPB) and Domino’s Pizza (LON:DOM), on Thursday said underlying earnings (EBITDA) rose 15% to US$18mln (£13.8mln) in the six months to the end of June on sales 26% higher at US$77.8mln.

READ: SafeCharge shares up as new customer wins fuel profit growth

"It is clear that its strategy to migrate the portfolio to lower risk and larger customers is paying off and, with the purge of the back-book completed, the business is accelerating," Barclays analysts wrote in a note to clients.

"It has a strong technology offering though and, with a large and expanding market, SafeCharge should benefit and become a credible acquirer, particularly in multi-source accounts," the analysts said, adding that it had also increased the group's target price to 420p from 335p.

The AIM-listed payments technology company said it had made a good start to the second half of 2018, benefiting from continued growth from its existing customers and further new client wins.

Shares in SafeCharge were flat at 306.50p in mid-morning trade.

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