Half yearly financial report for the 6 months ended 30 September 2015

The full announcement is available here

 

HIGHLIGHTS

 

 

6 months ended 30 September 2015

6 months ended 30 September 2014

Increase/

(decrease)

Revenue

£102.8m

£104.3m

(1.4%)

Net revenue1

£59.3m

£57.9m

2.4%

Gross margin

49.6%

48.0%

1.6ppts

Operating profit before goodwill impairment2

£21.3m

£22.4m

(5.0%)

Adjusted earnings per share3

24.8p

26.0p

(4.6%)

Interim dividend per share

14.2p

12.4p

14.5%

Cash at period end (comparative 31 March 2015)

£46.1m

£43.9m

4.9%

 

Good progress in our strategic priorities

  • Sales success in multi-channel payment solution, including first big six energy client and a framework agreement with a housing consortium for rent collection
  • New tablet based retail terminal, which builds new functionality (to include EPoS) now in pilot phase
  • Reorganising to improve cost efficiency and provide better strategic focus
  • Active review of new countries with retail network potential
  • Potential beyond current verticals enabled by new retail technology
  • Discussions continue with Yodel on Collect+, with reduced profitability from cost increases
  • Sale of Mobile and Online businesses expected to complete in the second half of the financial year

Financial results

  • Overall results for the first half are in line with our expectations, but weather warmer than expected
  • Net revenue up 3.5% in retail networks
  • Operating profits2 decreased by 5.0% as expected, from investment in Mobile and lower revenues in Online Payments
  • Online Payments goodwill impairment of £18.2 million as offers have not met expectations
  • Robust balance sheet with cash of £46.1 million and undrawn credit facility of £45 million
  • Increase in interim dividend by 14.5% to 14.2p

Operations

  • Record first half group transaction volumes at 399 million, up 6.9%
  • Romanian bill payment transactions grew 15.6%
  • Total retail network sites increased to 38,000 and Collect+ to 6,000 going into Christmas peak
  • Mobile and Online transactions up 22.2% to 85.9 million

Dominic Taylor, Chief Executive of PayPoint, said:

“In the first half of the year, I am pleased to report further progress in the delivery of the strategy we outlined last year. We have leveraged our unique business model to secure the best client offering and drive growth in our retail services through innovation in new products and technology. We continued to seek new international opportunities. Overall the results are in line with our expectations for the first half, with the performance from retail networks offset by losses in Mobile and Online Payments, which we expect to sell in the second half of this financial year as announced in May this year. Offers on the Online Payments business have not met expectations and accordingly, we have impaired the entire goodwill on this business.

Looking ahead to the second half, we expect to conclude current Collect+ joint venture discussions with our partner Yodel and complete the sale of our Mobile and Online businesses. Overall, we expect to make further progress across the business, with trading since 30 September in line with our expectations. Our dividend increase anticipates double digit growth in the dividend for the year as a whole and reflects our confidence in the business and its long term prospects.”

Enquiries

PayPoint plc
Steve O'Neill
Group Marketing Director

+44(0)1707 600 440
[email protected]

PayPoint Press Office
Finsbury

+44(0)207 251 3801
[email protected]

A presentation for analysts is being held at 11.45am today (26 November 2015) at Finsbury Group, Tenter House, 45 Moorfields London EC2Y 9AE
 

The full announcement is available here

  1. Net revenue is revenue less the cost of mobile top-ups (where PayPoint is principal), SIM cards and other costs incurred by PayPoint, which are recharged to clients and merchants.These other costs include retail agent commission, card payment merchant service charges and costs for the provision of call centres for PayByPhone clients.

  2. Operating profit before goodwill impairment includes our share of joint venture results.

  3. Adjusted earnings per share are stated before the £18.2m impairment of goodwill in the Online Payment business.

    Net revenue, operating profit before goodwill impairment and adjusted earnings per share are measures the directors believe will assist with a better understanding of the underlying performance of the group.