Nexi S.p.A. (NEXI) Earnings Call Transcript & Summary

Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Nexi Full Year 2020 Preliminary Results Conference Call. [Operator Instructions] 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 3, where we tried to basically highlight the 3 key messages that we believe are important from today's session. So 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 EUR 466 million, up double digit, plus 11.2%. Revenues were at EUR 1.044 billion, minus 2.8% in the year with a positive Q3 and a basically flat Q4 over last year, minus 0.7%. And overall, we had a very resilient operating performance with good traction despite COVID on our key bit propositions. The second key message is that despite the complexity of managing the COVID situation and obviously, the pressure on volumes and therefore, on top line, we continued 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 tried to highlight a couple of [ factoids ] here. We see at the same time, and this is probably even more important from the strategic point of view, a growing interest from merchants and consumers for more advanced digital and omnichannel solutions, and we'll comment on this. And finally, now we have seen good traction on government cashless initiatives, in particular on cashback that was started in Christmas, I would say, version at some point at the beginning of December and will continue for '21 and probably '22. 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. And over the last few hours, we've 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, 2021 performance will continue to depend in a very relevant way on the dynamics on COVID. We will comment our outlook for the new year at the end of the presentation, but it's very clear that there's 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, as a combination of acquiring and issuing, were down 11% versus 2019. In the last quarter, they were down minus 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 minus 50% impact on overall volume, this second wave has seen at 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 2 qualities compared to the first one. Obviously, they were much better planned, given the fact that the first wave came as an absolutely new thing. First of all, they were more selective in nature. For example, industrial production, business-to-business activities 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, from basically mid-January, we see a rapid volume recovery, quite similar to the one that we have seen in May, June, July at the back of the first wave, 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 and by visitors, that obviously remain very weak. And you focus on the Italian cards only, the 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. That basically, over the last few days and week, now we've seen as a total a volume dynamic that is marginally negative, minus 2% year-over-year already. We saw throughout the year a strong e-commerce acceleration, net of, 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 minus 2%. And finally, as I said before, we continue to see signals of acceleration from cash to digital transactions, and we've seen a good traction for government cashless initiatives, especially on cashback. We can comment more on Q&A. I 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 guide the market on data that are not yet reliable. As you probably read that 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. It's a bit more complex in terms of customer experience. We 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. It was actually up 8.3% in the quarter -- in the last quarter. EBITDA minus CapEx overall was up double digit, plus 11.2%. Revenues were down minus 2.8% in the full year and basically flat year-over-year. We will comment the business update of the 3 business units later on. So let me jump over it. We had a strong performance on cost, that obviously has supported the growth of EBITDA despite COVID. Costs were down 9% year-over-year, continued to -- basically due to our continued effort on efficiency and the EUR 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 over EBITDA multiple was down at 3.5x, 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 2.5x EBITDA. Only in April '18, when we did took -- take the company public, and we were at around 3.5x, we said very clearly that we were seeing a long-term target for our leverage at 2 to 2.5x 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 -- let me also give you an update on where we are on the SIA and Nets transactions. As I said, we are progressing as planned. We signed -- basically signed this morning the binding documentation on the SIA transaction. As far as the Nets transaction is concerned, we have filed already the cross-border merger plan with 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 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 our resilient business model and a few projects and customer wins outside of Italy as well as partially in Italy. Nets result were 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 it is happening also on the back of very positive cost measures that the company is undertaking. Revenues were, again on an underlying basis, marginally down in the year, minus 1.2%, with a minus 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 6 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 6 the combination of our issuing volumes and acquiring volumes. You see, 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, that slowdown had peaked basically around mid-late November at around minus 20%, to then recover at the beginning of December, when basically reopenings were allowed in the preparation of the Christmas season, then went down again in -- 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 results and the evolution of the pandemic was positive, there was a reopening after that. And you see that rapidly the volumes come back to much better levels and again, closer to last year results. Following page, Page 7 gives you the split that we have 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 stand-alone 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. And here, you see that while the international travelers' contribution remains negative -- very negative, I would say, it's minus 70%, minus 80% still -- you see that instead, the Italian customers already at the beginning of February, late January were back to positive growth, and you will see the details in a moment. So very similar behaviors to what we have observed in the summer, even if the international travelers are not back to Italy yet, and not actually traveling anywhere around the world yet. Page 8, I will spend a few more seconds on Page 8 because Page 8 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 3 macro sector in Merchant Services. Again, we separate in between basic consumptions: groceries, medical retails, utilities, services. So activities that remained 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% in 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 now the last week rolling. The last week rolling is particularly important because it's 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 6:00 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 minus 2%, so very close to last year values. But I think it is even more interesting to look at the 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-impact consumption is still negative on a total basis, minus 45%, even if you see an improvement compared to the recent month, with Italian being at minus 35%. Overall, again, Italian is a plus 6%. On the following page, you see basically these dynamics represented 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 that we have 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, 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 2 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 limitation, no, 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 lumber, that is a large chunk of the 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 that was coming from mid-late January across the different zones. And again here, we look at Italian card 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 a plus 3%. If you remove the high-impact consumption sector it 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 a rebound. When you reopen stores, people have the tendency to buy more than normal, simply because they could not buy before. But said 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 therefore top line. The faster recovery being observed over the last 3, 4 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 our 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 fixed 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, minus 2.8%, with the quarter basically almost flat year-over-year at EUR 290 million. Let me just now jump into the business unit by business unit focus. Let me start with Merchant Services & Solutions. Obviously, the key drivers throughout the years have been the continued development of our propositions for both SME and LAKA. And e-commerce, we continued 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 LAKA and e-commerce. We saw not just the volume dynamics, as I just described, but also more and more demand for bank omnichannel 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 all those stores being closed, we saw our growth for the overall base of about 4%, also driven by the vertical industry propositions. The -- indeed we see these actually continuing. Second, we saw a significant acceleration of omni-channel and mobility solutions. I think we've spoken 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, e-mails, with apps, whatever they want to their customers. Actually, we had a good progress on SmartPOS sales as well. And we now launched also the proposition on Intesa book. We have completely redesigned a mobile POS proposition. We launched the new ones at the end of last year and it's 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 all this, we've been working throughout 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, and in particular electronics and technology-leading retails, 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 -- moving to the other 2 sectors. Large Merchants & Omnichannel, 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 omnichannel 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 omnichannel. We saw a growing pipeline of customer demand in a list of emerging verticals that are understanding that omnichannel acceptance is very critical for them. Just to mention one, insurance agent networks or pharma in 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 especially 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 4x if you include Pay-by-link, that is technically like a gateway activation. But putting that aside, it's been up 50%. We have enlarged our strategic partnership footprint with content management providers and marketplaces like ItaliaOnLine, StoreEden and a few others. We already had many and we simply continue to reach them. We had new wins in invisible payments, good traction on Public Administration segment, where we've been the largest acquirer with 100% year-on-year growth in PagoPA, and we are now applying a strong focus in managing the impacts of the evolution of the strong customer authentication regulation in the Italian market, both at the merchant and the consumer end 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 the decrease on volumes that is consistent with the numbers and the graphs that I did show you before, minus -- around minus 10% to 15%, depending if you look at managed transactions or value of managed transactions. 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 have been more successful in selling technology products and technology solutions across the various segments: SMEs, LAKA. But also e-commerce, I think e-commerce is probably the most visible example where basically, we had -- despite -- the total volumes did marginally decline. Actually, our revenues in the segment did go up, thanks to the sales of more technologically 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 on-boarding and remote selling. And 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 base, I would say in particular, on 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 50 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. While at the same time, we continue to support the evolution of National Debit, implementing all the digital capabilities that are becoming available. And actually, we continue to see a growing interest and a growing pipeline for our business-to-business virtual card for 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 a 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 in the number jumped 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 EUR 25 to EUR 50. What does it mean? That today, if you transact contactless below EUR 25, you can avoid to basically put your PIN or sign the receipt. Over the next few months, this limit will go from EUR 25 to EUR 50 as, by the way, has happened already in a few other countries. We also saw a step-up in mobile app 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 our -- all our analysis suggests that this is an enabler of further digital payments, cash digital payments conversion. Basically, we did continue to promote our loyalty program and all the other value-added services [ that we have around it ] with further penetration. And we actually did a lot of effort to support the government initiatives, in particular the cashback, allowing our customers to have easy access from our apps and banks apps as well, and basically roll in the program as fast as possible, basically with one click. Just to give a data point, if the country average is about 10% registration on the cards that -- where we manage the customer experience and more data if you count the licensing cards, that penetration has been above 15%. Last but not least, on YAP, even if we reduce 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 to 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 we increased the 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 run 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 growing interest actually, we have 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%. And here again, we continue to drive evolution. For example, now we have 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 installed 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 2 angles. Number 1, and it's actually very related to merchant services as well, we are launching a new Pay-by-account product for very large tickets, 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 online banking of the bank through PSD2-enabled solutions in our gateway. As well as we saw growing traction for payment as a service for corporate 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-settlement banking services, providing, especially to the medium -- middle -- smaller-sized banks a bundle of payment and banking payment services at the same time. Last but not least, we continue to see good traction in Open Banking, where we have seen an explosion of volumes on the CBI Globe, although 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 main third parties that are registered to the platform are actually U.K.-based and trying to understand how to manage the implications of Brexit on their business. And 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 a higher decrease in the last quarter of this year. We are talking about a couple of million euros 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 these. So to give you an example, ATM interventions and technical systems 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.

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 EUR 45 million, that's a 9% reduction driven by the cost containment program where we exceeded our EUR 100 million 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 through seasonality, and the fact that the cost-cutting program was announced in May, but it took 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 performance targets linked to EBITDA, which we clearly didn't reach compared to our budget, which was set at the end of '19 and reduced the bonus pool for some of us. And 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 is 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 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 -- 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 (sic) [ inhibit ] 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 EUR 100 million of cash containment. We exceeded that by approximately EUR 5 million. Part of this fed into the P&L, part of it was just cash flow [ to ] 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 135 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 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 transform -- IT strategy and the transformation CapEx spend. Back in -- back in with the June results, so at the end of July, we had approximately EUR 120 million 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 a reduction of approximately EUR 40 million of this EUR 103 million. Therefore, we will save approximately 2/3 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 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'll 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 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 continue to reduce transformation costs. They've been halved compared to where they were in 2019, and I remember that 2019 was down more than 60% compared to 2018. Essentially half of this transformation is now related to the app. The other half is equally split between some fewer transformation costs. I'll mention, for instance, some penalty payments we made to get out of certain contracts, including rental contracts for our Mercury Payments 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 2 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 noncash LTI component of deferred compensation, and the other half is related to COVID costs. So sanitation of head offices, buying masks and vaccination of the flu, the early -- of the COVID, unfortunately [ we had the ] flu, et cetera. We also have EUR 17 million of costs which flow through our P&L, but are actually met by Mercury U.K. So they have a 0 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 net -- normalized net profit, which is substantially, let's say, in line with last year, slightly down at EUR 245.8 million. I think if we took out from last year the capital gain on the sale of [ Oasi ], we 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 if you -- this is before interest and taxes. After some taxes, we have EUR 280 million normalized free cash flow. We will be upstreaming north of around about EUR 350 million of cash from the subsidiaries to service debt at the parent company level, which is what you would see from this diagram are mostly cash flow. Add back the interest expense, which is more in the Nexi level, and you get to the cash which gets upstreamed from the payments at 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 onboard additional EUR 1 billion of debt. Had we not done that, we would land at the end of 2020, notwithstanding COVID, at 2.5x leverage, which is in line with the guidance we gave at the IPO in terms of our mid-term guidance -- sorry, mid-term 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 at 3.5x, which is the 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 this 2020 performance compared 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 positive return to revenue growth by year-end. Despite the second wave of COVID, we saw positive growth in the third quarter. And as you see that 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 '19, and we were targeting a 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 the growing space until year-end. For the full year, we grew EBITDA by 2.5%. We did overdeliver our cash cost containment plan despite, as you've seen, the volumes have been probably a bit better than what we expected. Overall, we saw a normalized operating cash flow conversion at 80%, with a cash position improved versus last year and with a 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 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 our guidance. So we consider again as 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 3 percentage points versus 2019; 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 2021 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 decided 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 this 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 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 going to be very difficult to be 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 and with all of you, to be explicit about the hypothesis and to provide you what is, at the end of the day, at 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 3 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 we -- in the year, we expect to have a stable EBITDA margin. But I want to put this in perspective. If you take our midpoint of the outlook for 2021, and you compare that number, that outcome with 2019, 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 2020, with the outlook we're giving you in 2021. Basically, what you find is that we would have a mid-single-digit growth of revenues from 2019 to '21. So not only we are already back to the levels of 2019, but we are actually about mid-single digit up. And similarly for EBITDA, you would have a growth from 2019 to 2021, up about double digit, which obviously confirms the operating leverage improvement that we had in the past, and we believe will continue in the future. Simply cannot merge these 2 strange years, '19 and '20 in the -- sorry, '20 and '21 -- in the specific year. That's the reason why you see the continuation of the EBITDA margin, but not further margin expansion due to the unwinding of certain cost cuts and actually, the investments that we will 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 3 key messages I gave you at the beginning. Page 30, a very special year, I would say, for all of us. 3 key messages for us that will remain for 2020: strong overall 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 (sic) [ signs ], second message, of acceleration of digital payments, based 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 things also 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 that we're progressing according to our plan, signing the SIA deal today, and basically filing for antitrust approval on Nets a few days back. Overall, 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 very happy to take your questions.

[Operator Instructions] The first question is from Stephane Houri with ODDO BHF.

So I have 2 questions, actually. The first one is on the revenue, let's say ambition for 2021. When you said mid to high single digits, in fact, it looks a little bit better than your normal guidance of 5% to 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 an accelerated digitalization of the economy, more digital payment more online? So if you can just clarify that for me. And the second question is about the absence, in a way, of operating leverage, because you're guiding for flat EBITDA margins for the year. So -- despite this growth guidance. So can you re-explain the different elements that lead you to guide for flat EBITDA margin? Is it a question of costs coming back after the cost containment program?

So Stephane, thank you for the 2 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 2021 in isolation to what has happened in 2020. Because somehow, the worse you perform in 2020, the better you perform in 2021, and the other way around. That's really the reason why it's important to look at these 2 years in combination. And by the way, when we project our volumes in the future, we continue to look at what we thought was 2020 budget. Because otherwise, you had completely misled. So this is the main reason why we would frame the comparison with our guidance, is this combination of '20 and '21 outlook. If we take again the midpoint of 2021 outlook, basically, the growth would be of 5% from '19 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 had out. But I think technically, it's probably better to look at it as a combined 2 years' basis. As far as leverage -- operating leverage is concerned, the same logic has to apply. If you look at our performance in the 2020, here operating leverage has been somehow super strong. Because we grew EBITDA 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 -- 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 this year, we are confirming the EBITDA margin of 2020, which means that over the 2-year period -- and again, this is the right way to look at it, we believe -- we saw a margin expansion of 3 percentage points from 55% to 58%. By the way, organic. So this is already making their contribution of the Intesa book acquisition. And this is basically the operating leverage improvement that we have seen over the last 4, 5 years, 1.5 percentage points per year. Simply, this year we had 1 year where you had 3 percentage points' expansion, and the second year when we said that will be more flat. So again, let's take the 2 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, we're not providing the guidance for the year. Let me please not get into providing the guidance for the quarter. The -- again, the outlook will depend very much on the comparison for last year. 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. This year, our expectation is that obviously, compared to last year, as a consequence, we will have a softer 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 of the next few weeks. Bernardo?

All I would add, Paolo, is that in putting together our ambition I think we take comfort from how we're performing in January and February compared to the ambition we stated, I would say.

Yes, of course.

Your next question is from Mohammed Moawalla with Goldman Sachs.

Paolo and Bernardo. I had a couple of questions. Firstly, I 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 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 want to kind of understand the nuances there. And then secondly, as we think of that shape of that recovery, I don't know if maybe you can help us a little bit around that. 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 2 months of the year? So just trying to get a sense of that acceleration in the back half. And then as we start to think about this more medium term, you obviously had that sort of 5% to 7% objective. But when we start to look beyond 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? Are we going to revert back to the lower band of that guidance? And what I'm trying to get at is how much of that demand has been pulled forward.

Mo, 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 going to be reabsorbed over the next 2 or 3 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 instead it goes the other way around, you could also end up on a lower end of whatever, 5% to 10% range or whatever you want to consider the range for a midpoint and mid-high single digit. But yes, double-digit growth is possible. And by the way, it was 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, so let me try to really give you the sense of what we do and we plan. The way we plan this is basically sector by sector. So you remember, the 3 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 digital -- of cash to digital transition that we see for the Italian cards. 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 over the year. So keeping that in mind, just to give you a flavor of the outlook that we see for the year. We basically see an outlook where Italian cards 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. And again, you have 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, supported -- was 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 low 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, we 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 reinstated into a normality on the back of COVID. So it's done with a lot of, I would say, detail and analytics and some support, but unfortunately, you know that it is false precision. But this is, at the end of the day, 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's the reason why, when we think about a mid-term future with mid-high single-digit -- for normal years, not for this year only, but for normal years -- mid-high single-digit EBITDA growth and double-digit -- sorry, revenue growth and double-digit EBITDA growth. We still feel comfortable with that type of outlook for M&A.

The next question is from Josh Levin with Autonomous.

I have 2 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?

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 impact 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 BPER. So the impact of all of that is already into our assumptions and is broadly in line with what -- with BPER. Obviously, I'm not talking about potentially buying the UBI book, I'm 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 dei Paschi, all of that. Honestly, it's really too early to talk about it, and we don't see impact next -- I mean in 2021. Not necessarily in 2022 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, I would [ 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 should always remember that e-commerce for Italy, the new SCA customer authentication implementation is, again, affecting only e-commerce and is -- and therefore in 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, the -- you will have these new rules being applied with stronger customer authentication. January was a threshold of EUR 1,000, so you had to apply them above EUR 1,000. From the beginning of February, it is above EUR 500, and there is a road map to continue to decrease this. We are clearly observing very carefully the customers. We did put, obviously, in place on 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 -- this properly. But clearly, in terms of customer experience, this is a change. So I'm sure it has -- it will have, over the next very few months, some short-term impact, but I would say immaterial on our numbers.

The next question is from James Goodman with Barclays.

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 growth in the margin versus 2019. 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 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. I realize you don't have control or complete visibility there, but I 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?

James, and thank you for the 2 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 strategy and so on and so forth. To be clear, we -- 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 and in the future. So we will not sacrifice short term -- we'll not sacrifice future revenue growth for short-term cost efficiency. In here, it's really, really important that we look at the 2 years all together. If you take our costs from 2019 to 2021, underlying our ambition for 2021 de facto cost reduction, so we would be a minus 2%, minus 3% cost base from 2019 to 2021, 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, 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, do you want to add color on cost and then SIA?

Costs obviously, I'm biased. But I think you're understating our efforts on cost because we are going to be structurally below where we were in 2018, 2019 going forward, notwithstanding volumes coming back. And at times, all these questions on the guidance, I think we're, again, maybe not 100% clear. If we closed 2020 slightly worse than we did, so if we'd underperformed slightly, there would be no question about double-digit growth in revenue. 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 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 messages Paolo has passed on should be loud and clear: that we will land, in terms of revenues, [ pretty ] higher than where we would have been in 2020 based on the previous guidance. So if we 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 2019, which is a function of the in-sourcing of some of the costs we were paying out to SIA and to Worldline, and in part, other efficiency measures that we were making. Now in terms of the rebound next year and how we manage the cost next year being 2021, sorry, the cost this year. We started our budget. Some of it is 0 based. Some of it is unfortunately, fixed or inertial. But we have the reappearance of certain costs which are not proportionately tied to the growth in revenues. Think of, I don't 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 0 in 2020. In 2021, hopefully, we meet our EBITDA target, we will be paying that. And that is not really linked to the growth in revenue. So you have this structural rebounding cost 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? On the progress of the...

Yes.

So SIA, we published in the Appendix of our document, a table showing the P&L for SIA. As you can see, SIA was -- 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 as being a primarily processing business, is less affected than we were by volumes, because a value 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 -- is a skew -- is further skewed than ours to payments which are not necessarily card rails, bank transfers, et cetera, which were less impacted by COVID. So structurally, they have a business which was better protected by the impact of COVID. And additionally, they had some client wins and just grew the business organically such that revenues overall in the year grew 2%. And in the quarter, if you look at it, and this is more an 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 they had revenues on a quarterly basis, '19 over '20 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 cost 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 digit 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 2021 optimistically.

Your next question is from Adithya Metuku with BAML.

Just 2 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 work? And how should we think about one-to-one transplantation of these transactions, card transactions by pay to 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. I just wanted to confirm that this doesn't mean that the share count will change post the 2 transactions being completed. It will remain at what you expected it to be before, regardless of the timing of the closure of these 2 transactions. If you could clarify that, that would be great.

Adi, this is Paolo. So 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 part of our customers right now. The -- let me put it this way, the pricing is structurally a bit different from the one that you would have for car 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. And 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're enabling through our gateways, transactions that would normally go in a different direction. And thanks to the fact that we enabled them through our technology, hopefully, we will be able to make a good business also on this type of transactions. On the share count, Bernardo?

Yes, sorry, Adi. The share count potentially will change depending on whether CDP, the banker shareholder and the controlling shareholder of SIA, decides or not to exercise its antidilution 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 whatever decision-making process they have internally that needs to go through.