Shareholder Update, page-65

Dear Shareholder

I am pleased to present theISX Financial EU Plc (unaudited) results for Q1 2022 as part of our Quarterly Update process.

In Quarter 1 2022 the Group has recorded anunaudited €0.8m profit, up 137% on an annualised basis versus Full Year 2021.

In Quarter 1 2022 the Group focused ononboarding new customers and offering existing customer new products, withtotal Electronic Money Issued up 44% and revenue up 21% on an annualised basisversus Full Year 2021, with major clients yet to be fully onboarded. Marginsdecreased in the quarter, as the Group continued to focus on diversifying itsrevenue away from card acquiring, towards lower cost instant and batchedinterbank payments, and creating a multi-rail ecosystem centred on its flykk®service.

Expenses in the first quarter were up 10% on anannualised basis versus Full Year 2021. Payment scheme costs remained wellcontrolled, up 10% in the quarter on an annualised basis versus Full Year 2021,as the Group continued to focus on diversifying its revenue away from highercost card acquiring, as outlined above.

During Quarter 1 2022 the Group incurred a €474kimpairment charge on its investment in NSX Limited.

Cash and cash equivalents remained strong at€5.4m as at 31 March 2022 (up €0.2m versus 31 December 2021). During thequarter the Group also repaid circa €1 million, in debt, leaving a remainingconvertible note payable of €3.5 million.

During Quarter 1 2022, the Group continued tosee funds held on behalf of merchants increase, up 4% to €97.5m due toonboarding of new customers.

Click here for the Quarterly Update.

Next Steps towards IPO

The Company will be seeking to reorganise its assets under a new holding company, ISX Plc, which will be the listed entity and issuer of securities. Shareholders will retain their holdings in direct proportion to their existing holdings. This allows the group to re-organise its operating companies and financial reporting lines on a geographic basis, consistent with our prudential supervisory and taxation reporting obligations. The “top hat” process of inserting a holding company above will be via a court supervised scheme of arrangement, and subject to a shareholder vote at general meeting.

The audited accounts are being finalised, and will also be issued shortly, as these are a key requisite for the Initial Public Offering (IPO).

As with any IPO, there is a lot of work to do including a new prospectus, appointing a sponsor broker, updating insurances, updating company policies and procedures consistent with the target stock exchange requirements, and ascertaining the level of interest from funds/institutions and strategic partners.

With the number of new clients growing and volumes being processed increasing per customer, we anticipate a listing towards the end of the year would be likely, provided that market conditions (incl the Ukraine impact) stabilise.

Overall, I am confident of a successful IPO based on the Company’s fundamentals.

Yoursfaithfully

N. Karantzis
Managing Director & CEO
ISX Financial EU Plc