The cloud-based provider of international payment, currency risk management and electronic account services to small and medium-sized businesses released its first set of results as a publicly listed company, which showed revenues rose to £1.66mln in 2020 from £1.24mln in the nine months to the end of 2019, representing slight growth on a pro-rata basis.
The fintech firm processed £462mln of transactions (2019: £336mln) in 2020 and added 328 new clients, compared to 181 additions the year before. The total number of clients increased to 732 from 530 at the end of 2019.
This year, 179 new customer accounts have been opened, increasing the group’s total number of customers to more than 810.
Trading in 2020 was heavily affected by the coronavirus (COVID-19) pandemic. Ahead of the COVID-19 outbreak, FXPress, the foreign exchange broking business, was delivering strong growth with revenue in the first half of the year up 20% year-on-year but the introduction of travel restrictions across the globe led to a contraction in trading volumes.
The gross margin for 2020 was 29.8% (2019 period: 43.4%) with the reduction due to both the increasing proportion of revenue derived through the group’s introducer network and revenue being more weighted towards network partners who receive higher rates of commission.
The lower gross margin contributed to a widening of the loss before tax to £2.16mln from £81,549 the year before, as did £0.8mln in costs related to the acquisitions of FXPress and Avila House and to the company’s flotation on AIM.
“Amid a year of global upheaval, 2020 was a milestone period for us; establishing Cornerstone’s foundations, making two key acquisitions and culminating, post-period, in our admission to AIM. While, along with the rest of the industry, our trading volumes were impacted by COVID-19, we successfully navigated the transition to home working with no disruption to our operations or service provision,” said Julian Wheatland, the chief executive officer of Cornerstone.
“We have come to the market to build a significant business in the provision of technology-enabled international payment services, foreign exchange and currency risk management. While we are still at the beginning of our journey, with our strong team and highly scalable platform, we believe we are well-placed to take advantage of the meaningful organic and acquisition opportunities that will enable us to achieve this,” he added.