Revolut, the British fintech company, has achieved record profits thanks to higher interest rates and an expanded customer base. Chairman Martin Gilbert praised the upcoming reforms of the UK stock market listing rules but expressed caution regarding a London IPO.
All the steps the regulators take are good. They allow founder-led companies like Revolut to list here instead of having no choice," Gilbert told the Financial Times. "But let's wait and see how everything develops.
Gilbert, who joined the fintech's board in 2020, stated that Revolut is at least a year away from an IPO and will remain open regarding the location. These statements mark a softening of earlier remarks by CEO Nikolay Storonsky, who had previously avoided the British regulatory environment and last year ruled out a London IPO. The SoftBank-backed company has been waiting for over three years for a UK banking license.
The British Financial Conduct Authority (FCA) is considering changes to stock market listing rules to make it easier for companies to use dual-class share structures, allowing founders to retain control even after selling large stakes.
Revolut announced on Tuesday that it achieved a pre-tax profit of 438 million pounds in 2023, compared to a loss of 25 million pounds in the previous year. Revenue nearly doubled to 1.8 billion pounds.
The company, founded by Storonsky and Vlad Yatsenko in 2015, has pursued ambitious international expansion and surpassed the growth of rival banks like Monzo and Starling, although it is still waiting for a British banking license.
The group added 12 million customers last year, bringing the total to more than 45 million. Interest income increased fivefold to 500 million pounds during the same period.
Our diversified business model continues to demonstrate resilience with robust growth across various business units," said Storonsky. "This growth has been driven by the introduction of new products and the acquisition of millions of new customers.
The British banking license application was delayed due to issues such as a warning from the auditors that they were unable to fully verify the revenue figures for the fiscal years 2021. A UK banking license would allow Revolut to expand its product and service offerings in its largest market.
The group, which holds a European banking license from the Lithuanian authorities and offers private loans in France, Germany, and Spain, expanded its loan portfolio to 528 million pounds. Advertising and marketing costs rose by more than 80 percent last year to 241 million pounds. As part of its expansion in Europe, Revolut purchased advertising space on jet bridges at airports across the continent.
Despite ongoing uncertainty over a UK license, the fintech is aiming for a valuation of over $40 billion in a stock sale, FT reported last month. This would exceed the $33 billion valuation from the 2021 fundraising round.
The company also announced plans to move its headquarters to one of the most prominent buildings in Canary Wharf, where it has been based since its founding.
