The EML Payments Ltd (ASX: EML) share price is ending the week in sensational form.
In morning trade, the embattled payments company's shares are up 36% to 57 cents.
Though, as you can see on the chart below, this doesn't hide the fact that the EML share price is still down approximately 80% over the last 12 months.
Image source: Getty Images
Why is the EML share price rocketing higher?
Investors have been buying this payments company's shares on Friday after it released an update on its European operations and guidance.
In respect to its European operations, known as PFS Card Services Ireland, the news is not good. Management advised that the Central Bank of Ireland has decided that growth in total payment volumes for the period 31 March 2023 to 30 March 2024 will be restricted to nil% above annualised baseline volumes in 2022.
This is down from the central bank's previous plan to restrict its growth to 10%. It made the move in response to disappointing remediation progress and the remaining "significant and ongoing deficiencies" in PFS Card Services Ireland's anti-money laundering and counter-terrorism financing (AML/CTF) control framework.
As EML operates its European operations through this business, this is a bitter blow.
So why are investors buying shares?
The reason the EML share price is rising today is that the company has reiterated its FY 2023 guidance. That's despite management previously warning that the above actions could impact its earnings.
The release reveals that it continues to expect revenue of $235 million to $245 million and underlying EBITDA of $26 million to $34 million.
The company also advised that it remains focused on engaging constructively with the Central Bank of Ireland, working to complete the remediation program, and ensuring all of the regulator's concerns are addressed.
