PayPoint PlcResults for the year ended 31 March 2025
Further progress towards £100m EBITDA by end of FY26
New targets established for the Group for the next three years, including share buyback programme increased and extended to at least £30 million per annum till the end of FY28
GROUP FINANCIAL HIGHLIGHTS
Nick Wiles, Chief Executive of PayPoint Plc, said:
“This has been another year of progress for PayPoint where we have delivered a resilient financial performance and made further significant steps towards delivering £100m EBITDA by the end of FY26. These results reflect both the resilience of our businesses in the current challenging economic environment and the impact of our growing capabilities as we unlock further opportunities and growth across our four business divisions.
Looking ahead, in addition to our existing target of £100m EBITDA for the current year, we have now established new targets for the Group for the next three years to the end of FY28, underlining our confidence in the future growth prospects of the business: achieving net revenue growth in the range of 5% to 8% per annum across the Group; establishing an organisational framework which will deliver greater automation of processes and greater agility to support the delivery of our plan; and delivering a reduction of at least 20% of our issued share capital through an enhanced share buyback programme, consistent with a prudent capital structure and leverage in the range of 1.2x to 1.5x.
We have had an encouraging start to the current financial year in each of our business divisions and have already secured a number of important new contract wins, particularly within the Housing sector. In addition to our focus on the organic building blocks for growth, significant energy is being directed into: building strong new business pipelines, particularly in Love2shop Business, Housing and Charities; successful delivery of our Local Banking service, with at least two banks due to go live in H1; continued parcels growth, driving volume opportunities with each carrier and growing Out of Home consumer adoption; optimising our retailer network performance, through better adoption of services, our new Store Growth Specialist team and further site growth; and the further upselling of our enhanced payment capabilities into our existing client base, including utilities. Our continued confidence in the growth opportunities in the business and the execution of our plan to deliver strong earnings growth and cash flow generation, combined with a sustainable dividend policy, provide a robust platform for the Board to further enhance shareholder returns through an increased and extended share buyback programme of at least £30 million per annum till the end of March 2028, all underpinned by our confidence and clear operational plans to deliver further progress in the current year and our £100m EBITDA target.”
SHARE BUYBACK PROGRAMME INCREASED AND EXTENDED
Today the Group announces its intention to increase and extend its 3-year share buyback programme (the “Buyback Programme”). This enhanced Buyback Programme reflects the strong cash generative nature of the Group, along with the Board’s confidence in delivering on our growth targets for FY26-FY28 and in-line with our commitment to enhance shareholder returns.
The Buyback Programme will be increased with a plan to return at least £30 million per annum to shareholders and will be extended until the end of March 2028, with the target of reducing our equity base by at least 20% over that period. We will continue to review the Buyback Programme based on business performance, market conditions, cash generation and the overall capital needs of the business.
Throughout this period, we will continue to increase dividends at a nominal rate and, as a result of our continued financial performance, grow our cover ratio from the current 1.5 to 2.0 times earnings range to over 2.0 times earnings by FY28. Combined with the increased and extended Buyback Programme, this dividend policy will enhance shareholder returns and ensure the business continues to maintain an efficient capital structure, balancing an appropriate leverage ratio of around 1.2 to 1.5 times net debt/EBITDA with the overall capital needs of the business.
DIVISIONAL HIGHLIGHTS
Shopping divisional net revenue increased by 1.2% to £65.2 million (FY24: £64.4 million)
E-commerce divisional net revenue increased strongly by 39.0% to £16.4 million (FY24: £11.8 million)
Payments & Banking divisional net revenue increased by 1.7% to £54.4 million (FY24: £53.5 million)
Love2shop divisional net revenue increased by 0.8% to £51.7 million (FY24: £51.3 million)
BUILDING BLOCKS FOR GROWTH
In the current financial year, the Group remains focused on executing against the seven building blocks for growth to the end of FY28:
RECONCILIATION OF REPORTED NUMBERS
BUSINESS DIVISION NET REVENUE AND MIX
A presentation for analysts is being held at 9.30am today (12 June 2025) via webcast. This announcement, along with details for the webcast, is available on the PayPoint Plc website: paypointbusiness.com/corporate
CHIEF EXECUTIVE’S REVIEW
GROUP UPDATE
Resilient financial performance with further progress towards delivering £100m EBITDA by the end of FY26
This has been another year of progress for PayPoint where we have delivered a resilient financial performance and made further significant steps towards delivering £100m EBITDA by the end of FY26. These results reflect both the resilience of our businesses in the current challenging economic environment and the impact of our growing capabilities as we unlock further opportunities and growth across our four business divisions.
Targets for the Group to the end of FY28
While we remain focused on the delivery of our current target of £100m EBITDA by the end of FY26, looking further ahead, we have now established new targets for the Group for the next three years to the end of FY28, reflecting our confidence in the growth prospects of the business and our continued commitment to delivering enhanced returns for our shareholders:
1. Achieving net revenue growth in the range of 5% to 8% per annum across the GroupOur strategy over the past five years to transform the business and its capabilities from our legacy cash bill payments history has created a more robust and higher organic growth platform. We believe a combination of our business mix today and the opportunities in each of our key building blocks for growth supports a consistent, underlying net revenue growth rate in the range of 5-8% per annum.
2. Establishing an organisational framework which will deliver greater automation of processes and greater agility to support the delivery of our planAn important next step to support the delivery of this growth is to ensure as a business we have the necessary organisational framework to deliver better operational performance at a reduced cost and a higher level of customer service and experience. To achieve this, we have sought the support of Nile, an independent consultancy, in a project to review our operational structure and business processes today and develop a plan to deliver greater automation and business agility in the future to support the delivery of our plan.
3. Delivering a reduction of at least 20% of our issued share capital, with scope for leverage in the range of 1.2x to 1.5xThe actions we are taking to deliver sustained organic growth across the business in a more efficient and agile business structure will further enhance the core cash generative characteristics of the business, enabling an accelerated share buyback programme over the next three years within a prudent capital structure of leverage in the range of 1.2x to 1.5x
REVIEW BY DIVISION
SHOPPING DIVISION
In Retail Services, our core focus is to continue the growth of our retailer estate and to drive a consistently higher level of adoption of our service proposition. We remain committed to supporting our retailer partners drive more revenue and to maximising the opportunities from our unparalleled portfolio of community services. The next stage of that commitment is the recent rollout of a Store Growth Specialist team, dedicated to supporting retailers to unlocking more commission opportunities and enabled by targeted data and analytics to ensure we are focusing our efforts in the right locations. Early indications from this rollout have been very positive in terms of demonstrable performance optimisation and services adoption. In addition, we continue to drive further engagement with our Retailer Rewards scheme, launched in September 2024, giving retailers additional commission for scanning goods in store. Our next generation device, PayPoint Mini, continues to rollout across our estate with 2,898 now live, along with our integrated third-party EPoS solution, PayPoint Connect. We also now have structured plans in place to support our multiple retailer partners in maximising the value of our wide portfolio of services in their stores, including the rollout of additional Collect+ sites, FMCG campaigns, Love2shop gift cards and our new Local Banking service. Our FMCG consumer engagement proposition, PayPoint Engage, continues to gain good traction delivering campaigns for major consumer brands, leveraging our PayPoint One platform, advertising screens and vouchering capability. Over 18 campaigns have been delivered in the year, including an award-winning campaign for Spar during Euro 2024, with a building pipeline of further brand campaigns for delivery over the next 12 months.
In Cards, we have focused in the year on delivering a successful transition to Lloyds Bank Cardnet as an acquiring partner across the wider Group, with the partnership launching in December 2024 into our Handepay business. The partnership has enhanced our merchant proposition, including earlier in the day settlement, and delivered an enhanced and faster onboarding for our merchants. Additionally, we have launched our Merchant Mobile App, enabling merchants to access transaction data and insights about their business, with over 3,000 merchants already signed up and plans in place for further growth over the current year. Over the course of the next 12 months, we will be adding further features and functionality to the app, including real-time transaction data and the integration of our Rewards scheme. In the period, we have also improved participation in our Handepay Rewards Scheme, with over 3,500 merchants registered, and continued to drive further enhancements to our core proposition, with the launch of a new AI-driven statement reader to further speed up and enhance the merchant sales experience, strengthened pricing governance and time to transact drastically reduced from 14.7 days to 2.2 days, driven by our welcome call programme and an improved customer onboarding process with the new Lloyds Bank Cardnet partnership. All of these actions are focused on driving an improved retention performance in the current year, with a target reduction of churn to 25%. Our Business Finance product, via YouLend, continues to grow with over £23.8m of funding delivered to merchants across the Group in FY25, an increase of 23% versus the prior year, and with plans in place to pilot an Asset Finance product with merchants in H1 FY26.
In our Community Cash Access and Banking network, while progress continues to be frustrating, a detailed ATM recovery plan is now underway to improve performance in the current year, including the enablement of Mastercard and Visa throughout the network in H1 FY26, an improved support and maintenance model with Notemachine to drive ATM uptime and service, individual site performance optimisation visits and further network expansion opportunities in progress with new partners. Our Counter Cash service, offering withdrawals and balance enquiries over the counter, is now live in 2,993 locations, and we have processed over £475 million of consumer deposits for our neobank clients in the year. We are also well advanced with the launch of the first two major High St Banks delivering consumer deposits across our extensive network in H1 FY26, which will be followed by an SME deposit solution for High St Banks in development for pilot in H2 FY26.
E-COMMERCE DIVISION
In E-commerce, we have delivered a record year, with net revenue +39.0% at £16.4 million and parcel transactions growing to 133.4 million. This performance reflects the strong positioning of our growing Collect+ network for Out of Home (OOH) fulfilment with both consumers and carriers and a continuing market shift towards OOH delivery. Our partnership with Royal Mail launched earlier in the financial year, with over 7,500 sites rolled out across the UK and store to store and click and collect services now live. Our longstanding Yodel/Vinted partnership has continued to deliver strong volumes through our Store-to-Store service, with growing adoption by consumers and our carrier partners. We have also expanded our Zebra printer technology to over 93% of our network, underlining our continuing commitment to invest in improving the consumer experience in store and driving further adoption of Out of Home (OOH) with our carrier partners.
As referred to in our interim results in November 2024, we made a strategic investment in Yodel alongside other investors, including InPost in June 2024. As we indicated at the time, our investment was in support of the Yodel management team as they planned to further automate and modernise the Yodel business. Since this initial investment, InPost has provided Yodel with significant additional funding and announced their acquisition of Yodel on 17 April 2025, resulting in a significant dilution of our original investment to a 4.5% minority stake in the business and a write down of the investment to £2.2 million. An expansion of InPost PUDO locations has also recently been announced, growing to over 6,000 sites, which harmonises locations, parcel volumes and opening up the opportunity for further expansion and parcel volume growth across our extensive network for both InPost and Yodel.
We have now established new partnerships with Chinese and South Asian marketplaces, with the initial rollout of 26 stores with SFExpress, the leading integrated logistics service provider with an extensive PUDO network in China, focused on enabling our services in Chinese communities across the UK. We continue to explore further opportunities to build increased momentum and drive further volume into our network, with the primary focus to establish Collect+ as the first-choice partner for Pick Up Drop Off (PUDO) with these marketplaces.
We have successfully grown the Collect+ network to 14,213 sites in new locations and demographics, including increasing our presence with major multiple retailers like One Stop, Spar NI owned by Henderson Group and a pilot with Asda, rolling out further sites for the Royal Mail, InPost and UPS, and growing our student presence working with 19 of the top universities and student unions across the UK (Strathclyde, Aberdeen, Sunderland and Open University added in the year). We will continue to identify opportunities to grow the Collect+ network across a number of new and existing channels, in partnership with our carriers and consistent with developing consumer behaviours and needs in the Out of Home market.
PAYMENTS & BANKING DIVISION
In Payments & Banking, our integrated digital payments platform, MultiPay, continues to establish itself as a comprehensive payment solution for clients across card processing, Open Banking, direct debit and cash, with net revenue growth of 4.5% year on year. We have secured further strong wins in the Housing sector, with Guinness Housing, Sovereign and Thirteen, and in the Charity sector with several Citizen’s Advice regional offices, Alzheimer’s Society, Shelter and Wiltshire and Bath Air Ambulance. A major focus for the current year is on increasing opportunities to cross-sell payments services within our existing client base, leveraging our wider multichannel payments platform and Open Banking capabilities. We have also completed our first full year of delivering the DVLA International Driving Permit service, which went live on 1 April 2024, marking another key central government service fulfilled via our extensive retailer network.
In our cash through to digital category, we have made the key decision to build on our success and market positioning in the cash through to digital sector, by combining our leading portfolio of consumer brands, including Amazon, Netflix, Deliveroo and Uber, with physical Love2shop gift cards in store. This creates a strong consumer proposition, offering the choice of specific cash through to digital brands and our Love2shop multi-retailer redemption card, which is expected to generate meaningful additional card load and revenue opportunities for retailer partners. The strength of this proposition is evidenced by the sales momentum built with Love2shop gift cards in over 2,600 multiple retailers in the PayPoint network, establishing an annual run rate of circa £1m of value processed, and the early success of our partnership with InComm Payments offering Love2shop gift cards into a range of major retailers.
Following the completion of our majority investment in obconnect in October 2024, we are now making strong progress executing on our strategy in Open Banking. In PayPoint, we are focused on winning business with both new and existing clients delivering Open Banking services and payments channels, all enabled by obconnect and Aperidata, with 28 further clients live in the year for our services, including the Crown Commercial Service. In the year, the BBC also went live for Confirmation of Payee. In obconnect, the focus is on providing the necessary support and expertise to deliver data sharing ecosystems for major banks and jurisdictions, as demonstrated by the major contract win to deliver the Confirmation of Payee ecosystem for the New Zealand Banking Association which went live successfully in December 2024, including major banks like ANZ, Kiwibank and Westpac. In addition, a major focus for the current year is developing the next generation of Open Banking technology and capability, which will support future pipeline opportunities in this rapidly evolving market. As we indicated at the time of the announcement of the investment in obconnect on 1 August 2024, we have recognised a modest net revenue contribution in H2 FY25 of £1.8 million, in the expectation of a more meaningful contribution in FY26 and thereafter, driven by further pipeline opportunities in Confirmation of Payee, Verification of Payee in Europe and ecosystems in additional jurisdictions.
In Cash, legacy energy bill payments net revenue decreased by 6.5% for the year consistent with our expectations, with this part of the business continuing to be resilient, both in transaction volumes, rates and the renewal of a number of key contracts including Scottish Power. We expect this pattern and moderation in the rate of decline to continue into the current year. Over the year, the energy price cap, updated by Ofgem on a quarterly basis, was set for pre-pay customers at £1,643 for April to June 2024, £1,522 for July to September 2024, £1,669 for October to December 2024 and £1,690 for January to March 2025. However, the price cap has increased in the current financial year to £1,803 for pre-pay customers for April to June 2025.
LOVE2SHOP DIVISION
Overall, the Love2shop division had an excellent year, delivering growth in Love2shop Business, a resilient performance in Park Christmas Savings and strong progress in a number of key initiatives to develop new sales channels and partnerships. In Love2shop Business, we delivered a positive year with £172.2 million of billings delivered (FY24: £162.8 million), benefiting from the excellent planning and preparation by the Love2shop team well in advance of the peak trading period, and the growing benefits from corporate API integrations launched into major clients last year, delivering increased billings and improved customer experience. For our top 10 clients, we saw sales volumes grow by 17% YOY as we continue to develop our relationships, with ourmanaged client portfolio billings retention at 91% and major clients retention at 107%. During our peak trading month of December, we saw a YOY increase in AOV by 11% to £11.5k.
Highstreetvouchers.com performance was strong with billings +12.8% ahead of plan, reflecting the benefits of the actions taken at the beginning of the financial year to our online strategy. This positive outcome has been driven by a more efficient use of paid media spend driving a higher Average Order Value (AOV) of £320 vs £92 previously, improved customer journeys optimised for business customers transacting online or wishing to speak to our sales team, and an improved digital product and participation enabling larger bulk orders which has also increased AOV from £400 to £1500.
Our expanded distribution partnership with InComm Payments launched successfully on 20 October 2024 and has delivered a strong first six months with over £2.9 million of billings. The partnership has seen a significant expansion of physical Love2shop gift cards into major grocers and High St retailers, with plans already underway to build on this positive start and gain further momentum in FY26. Our sales momentum has also continued to build with Love2shop gift cards in over 2,600 multiple retailers in the PayPoint network, establishing an annual run rate of circa £1m of value processed. New redemption partners onboarded in the year for Love2shop included Dobbies Garden Centres, Foyles Bookstores, Blackwells, Frankie & Bennys, Las Iguanas and Wilko. Together these initiatives launched over the year have further enhanced consumer recognition of the Love2shop brand through our online and physical in store channels.
Park Christmas Savings delivered a solid outcome to the Christmas 2024 campaign with final billings of £162.2m, consistent with the previous year, with average saver value increased by 2.5% versus the prior year and customer retention strong at 91% of value retained from the prior season, all against the backdrop of tighter consumer spending and fluctuating consumer confidence over the year. A key focus in the year has been improving payment to conversion for new customers, which increased by 5% vs prior year delivering an improvement in the number of ‘nil paid’ and ‘off track’ customers. All of this has been achieved by focused saver activity and engagement campaigns leveraging Group capabilities via PayPoint’s PayByLink payment solution. The 2025 savings season has started positively, with gross accounts +18,000 versus the prior year, and the paid order book and cash collected +2% in the season to date. In addition, a new Agent App was launched to support savers and new digital gift cards added to the extensive product portfolio, with ongoing campaigns focused on driving payment to conversion. This again reinforces the enduring appeal and vital role this service plays in helping consumers budget for big occasions and avoid debt, with a Trustpilot rating of 4.6/5 and over £2 million of value delivered to savers each year. We continue to explore new expansion opportunities with a number of potential partners, in which to support further growth of our prepaid savings platform and leverage the strength of this capability.
MBL, the leading gift card technology platform that was acquired by Love2shop in 2022, processed £123.2 million in gift card value in in the year (FY24: £59.7 million), reflecting continued momentum as a gift card service provider for Greggs, B&M, New Look, Tapi, and Schuh, and as a key distributor for over 150 UK retailers' gift cards. We continue to expand the range of MBL solutions that we offer to our corporate clients and grow gift card management services with more retailers.
UPDATE ON CLAIMS AGAINST PAYPOINT
In FY24, a number of companies in the PayPoint Group, including PayPoint Plc, received two claims relating to issues addressed by commitments accepted by Ofgem in November 2021 as a resolution of Ofgem’s concerns raised in its Statement of Objections received by the PayPoint Group in September 2020. The Ofgem resolution did not include any infringement findings. The first claim was served by Utilita Energy Limited and Utilita Services Limited (subsequently renamed Luxion Sales Limited) (“Utilita”) on 16 June 2023. The second claim was served by Global-365 plc and Global Prepaid Solution Limited (“Global 365”) on 18 July 2023.
On 14 May 2025, PayPoint and Utilita came to a settlement such that Utilita has withdrawn its claim against PayPoint. As part of this settlement, the two parties have agreed to a new 5-year contract for over-the-counter prepayment services. PayPoint is looking forward to the opportunity to build a more collaborative and mutually supportive relationship with Utilita going forward.
PayPoint remains confident that it will successfully defend the claim by Global 365 at trial. The claim fundamentally misunderstands the energy market and the relationships between the relevant Group companies and the major energy providers, whilst also over-estimating the opportunity available, if any, for the products offered by Global 365. The trial at the Competition Appeal Tribunal, started on 10 June 2025.
OUTLOOK AND DIVIDEND
The continued progress and momentum established across the Group, particularly with the seven key building blocks, underpins our confidence in delivering our newly established targets for the next three year period to the end of FY28: achieving net revenue growth in the range of 5% to 8% per annum across the Group; establishing an organisational framework which will deliver greater automation of processes and greater agility to support the delivery of our plan; and delivering a reduction of at least 20% of our issued share capital through an enhanced share buyback programme, consistent with a prudent capital structure and leverage in the range of 1.2x to 1.5x.
We have had an encouraging start to the current financial year in each of our business divisions and have already secured a number of important new contract wins, particularly within the housing sector. In addition to our focus on the organic building blocks for growth, significant energy is being directed into: building strong new business pipelines, particularly in Love2shop Business, Housing and Charities; successful delivery of our Local Banking service, with at least two banks due to go live in H1; continued parcels growth, driving volume opportunities with each carrier and growing Out of Home consumer adoption; optimising our retailer network performance, through better adoption of services, our new Store Growth Specialist team and further site growth; and the further upselling of our enhanced payment capabilities into our existing client base, including utilities.
Our commitment to an increased and extended share buyback programme will enhance shareholder returns and is reflective of our long-term confidence in the business and our underlying cash flow. The Board has declared a final dividend of 19.6p per share, an increase of 2.1% vs the prior year final dividend of 19.2p per share, consistent with our dividend policy and target cover range of 1.5 to 2.0 times earnings excluding exceptional items.
We remain confident in delivering further progress in the current year, meeting expectations and achieving our financial goals to FY28.
Nick WilesChief Executive 11 June 2025
KEY PERFORMANCE INDICATORS
PayPoint Group has identified the following KPIs to measure progress of business performance:
FINANCIAL REVIEW
OVERVIEW
Current year total statutory revenue of £310.7 million is reported after an exceptional deduction of £14.2 million related to a claim settlement. Underlying revenue, excluding this deduction, increased by £18.5 million (6.0%) to £324.9 million. Net revenue increased by £6.7 million (3.7%) to £187.7 million (2024: £181.0 million). Net revenue from the PayPoint segment increased by £6.3 million to £136.0 million (2024: £129.7 million) predominately driven by the growth in e-commerce, with parcel transactions exceeding 130 million in the year, and the 5 months of net revenue contribution from obconnect partially offset by the cash payments decline in Payments & Banking.
Total costs increased by £0.4 million to £119.7 million (2024: £119.3 million). The increase in costs includes £1.5 million additional costs from 5 months of contribution of obconnect, together with increases in transactional costs of revenue and depreciation of terminals and devices used to drive revenue in the business, these increases have been partially offset by savings in overheads following the organisational restructure earlier in the year.
Exceptional costs of £23.4 million, which are one-off, non-recurring and do not reflect current operational performance, comprises settlement and legal fees incurred as a result of the Group’s defence of claims served against it, costs associated with early exit of a property lease in Love2shop and accelerated amortisation on certain modules of Love2shop ERP systems following the commencement to re-platform key systems. The prior year costs comprise the same legal fees as noted in the current year, restructuring costs and costs associated with refinancing for the Group.
During the year the Group remeasured its investments and convertible loan notes resulting in a net charge of £9.6 million in the Consolidated statement of profit or loss for the current year, reported within adjusting items (see note 14).
The underlying profit before tax for the Group increased by £6.3 million (10.2%) to £68.0 million (2024: £61.7 million).
Profit before tax of £26.3 million (2024: £48.2 million) decreased by £21.9 million (45.4%).
Underlying EBITDA increased by £8.7 million to £90.0 million (2024: £81.3 million), which comprises £21.0 million for the L2s segment and £69.0 million for the PayPoint segment.
Cash generation increased by £11.1 million to £69.0 million (2024: £57.9 million), delivered from profit before tax of £26.3 million (2024: £48.2 million). There was a net working capital outflow of £10.3 million (2024: £11.8 million) with trade receivables and inventory levels increasing as the Group grows its revenue and supports new revenue generating initiatives which requires increases in working capital.
Net corporate debt increased by £29.9 million to £97.4 million (2024: £67.5 million), with cash generation of £69.0 million offset by tax payments, capital expenditure, share buyback, investments and dividends. At 31 March 2025 loans and borrowings were £102.3 million (2024: £93.9 million)
PAYPOINT SEGMENT
Revenue of £163.6 million includes a £14.2 million exceptional deduction, excluding this underlying revenue increased by £8.1 million to £177.8 million (4.8%).
Shopping net revenue increased by £0.8 million (1.2%) to £65.2 million (2024: £64.4 million). Service fees net revenue increased by £2.1 million (10.7%) driven by the implementation of the annual RPI increase and additional PayPoint sites. Cards net revenue decreased by £0.3 million (0.9%), with site growth delivered in the PayPoint retailer estate and a reduction in the Handepay SME partners as we strengthen the field sales team and align to the strong and consistent progress already achieved in the Telesales teams. Lower than anticipated consumer spending has impacted the total value processed through the network which is down 4.2%. ATM and Counter Cash net revenue decreased by £1.0 million (11.4%) due to a reduction in transactions driven by the continuing trend of reduced demand for cash across the economy.
E-commerce net revenue increased by £4.6 million (39.0%) to £16.4 million (2024: £11.8 million), driven by strong growth in parcel transactions which increased by 33.3%. This was due to the growing strength in partnerships with InPost and Royal Mail, the investment in the in-store experience with Zebra label printers over the past 18 months and the continued expansion from new services and carrier partners.
Payments & Banking net revenue increased by £0.9 million (1.7%) to £54.4 million (2024: £53.5 million). Cash bill payments and top ups revenue decreased by £1.9 million (6.8%) to £25.9 million (2024: £27.8 million) driven by a 18.9% reduction in transactions following the reduced usage of cash and the continued switch to digital payments. Digital net revenue increased by £1.7 million (12.3%) to £15.5 million (2024: £13.8 million) with the current year including 5 months contribution from obconnect partially offset by a reduction in cashout transactions. In addition there was an increase in other Payments & Banking income received from a number of items which are non-recurring in nature.
The cost of commission to PayPoint retailers increased by £1.8 million (4.5%) to £41.7 million (2024: £39.9 million). This increase in payment to our retailer partners reflects an increase in the number of E-commerce transactions processed as well as more with higher commission rates per transaction.
Total costs (excluding adjusting items) increased by £3.4 million (4.3%) to £82.6 million (2024: £79.2 million), primarily as a result of the depreciation and amortisation impact of investment software and devices and the further investment in our people and field sales team to support growth in sales.
SECTOR ANALYSIS
SHOPPING
Shopping consists of services provided to retailer and SME partners, which contain two sub divisions, Card Services and Retail Services. Services include providing the PayPoint terminal to retailer partners, ATMs and Counter Cash and FMCG vouchering.
Net revenue increased by £0.8 million (1.2%) to £65.2 million (2024: £64.4 million) due to the growth in service fees driven by growth in sites and an annual RPI increase . The net revenue of each of our key products is separately addressed below.
As at 31 March 2025, PayPoint had a live terminal in 30,712 UK sites, an increase of 5.4% primarily as a result of new PayPoint Mini sales.
Service fees: This is a core growth area and consists of service fees from PayPoint terminals. Service fee net revenue increased by £2.1 million (10.7%) to £21.8 million driven by the additional revenue generating sites compared to the prior year.
Card services: Card acquiring services generated £21.0 million net revenue in the year, a reduction of £2.3 million from the previous year (2024: £23.3 million). Transaction values overall have decreased by 4.2% to £6,868 million (2024 £7,173 million) following lower than anticipated consumer spending. During the year unprofitable legacy RSM2000 sites have been removed which has reduced revenue and reduced costs.
Revenue from terminal rentals has increased by £1.8 million to £10.6 million (2024: £8.8 million) mainly as a result of a change in the sales mix of operating leases compared to finance leases. Operating leases also have associated costs included in the profit and loss account.
ATMs and Counter Cash: Net revenue reduced by £1.0 million (11.4%) to £7.8 million (2024: £8.8 million) as transactions reduced by 14.0% to 24.5 million. This is attributable to the continued reduced demand for cash across the economy. ATM and Counter Cash live sites decreased 33.7% to 6,365 following a review to remove non transacting counter cash sites.
Other: Other shopping services remained flat at £3.2 million (2024: £3.2 million)
E-COMMERCE
E-commerce net revenue increased by £4.6 million (39.0%) to £16.4 million following a record year for Collect+ as parcel transactions grew strongly by 33.3% to 133.4 million. This was due to the growing strength in partnerships with InPost and Royal Mail, the investment in the in-store experience with Zebra label printers over the past 18 months . There has been continued expansion from new services, Yodel store to store and Amazon returns, and new carrier partnerships with Royal Mail. Parcel sites increased by 20.6% to 14,213 sites.
PAYMENTS & BANKING
Payments & Banking divisional net revenue increased by 1.7% to £54.4 million following 5 months of contribution from obconnect included within Digital and higher non-recurring other income. This has been partially offset by fewer cash bill payments and top up transactions.
Cash net revenue decreased by £1.9 million (6.8%) to £25.9 million. This is due to a reduction in transactions as consumers move to different payment methods.
Digital (obconnect, MultiPay, Cash Out, Open banking) net revenue increased by £1.7 million (12.3%) to £15.5 million. This is mainly due to including £1.8 million revenue from the first 5 months of trading from obconnect. Digital transactions excluding obconnect decreased by 1.9 million (4.1%) to 45.0 million. MultiPay net revenue increased by £0.3 million to £6.7 million (2024: £6.4 million). The DWP Payment Exception Service contributed £3.5 million net revenue in the year (2024: £3.9 million) following the expected decrease in customers. Cashout revenue decreased by £0.4 million (14.0%) to £2.7 million (2024: £3.0 million). Open banking and other revenue increase by £0.3 million (60.0%) to £0.8 million (2024: £0.5 million).
Cash through to digital (eMoney) net revenue remained flat at £6.8 million (2024: £6.8 million) and transactions decreased by 0.3 million (3.7%) to 7.9 million (2024: 8.2 million).
Other payments & banking net revenue includes interest income from client balances, SIM sales and other ad-hoc items which contributed £6.2 million (2024: £5.1 million) net revenue. The year on year increase is driven by a number of items which are non-recurring in nature.
LOVE2SHOP SEGMENT
Love2shop (L2s) Segment has generated £367.5 million of total billings in the year (2024: £359.3 million). Net revenue for the year increased £0.4 million to £51.7 million (2024: £51.3 million) as a result of higher interest income and the product mix, partially offset by changing product mix in Prepaid Christmas Savings to drive customer retention and a reduction in prepaid media on lower margin billings which has led to an increased profit contribution.
Love2shop achieved £204.5 million of billings in the year, an increase on prior year of £7.9 million (2024: £196.7 million). This increase reflects improved performance in our corporate area, with our established client base achieving record retention and an increase in client order value of 11% during our key peak trading month of December.
Included in Love2shop are billings from the distribution partnership with Incomm payments, this went live in October 2024 with a phased rollout. During this phased rollout Love2shop gift cards were sold in over 3,100 unique locations, including leading UK grocers and high street stores for the first time. Through this partnership and our distribution across the PayPoint multiple retailer network gift cards were sold in over 6,000 unique locations in FY25.
Park Christmas Savings achieved billings of £163.0 million (2024: £162.6 million), building on prior year channel improvements.
PROFIT BEFORE TAX AND TAXATION
The income tax charge of £7.0 million (2024: £12.5 million) on profit before tax of £26.3 million (2024: £48.2 million) represents an effective tax rate of 26.6% (2024: 25.9%). This is higher than the UK statutory rate of 25% mainly due to the impact of prior year adjustments.
GROUP STATEMENT OF FINANCIAL POSITION
Net assets of £97.3 million (2024: £121.2 million) decreased by £23.9 million reflecting the first year impact of the share buyback programme, the claim settlement and fair value investment adjustments, partially offset by underlying profit after tax. Current assets decreased by £26.0 million to £270.6 million (2024: £296.6 million) due to a reduction in corporate cash and a decrease in the balance for items in the course of collection, an equal but opposite decrease in the settlement payables is included in current liabilities. Non-current assets of £237.8 million (2024: £222.5 million) increased by £15.3 million reflecting the acquisition of obconnect.
Total liabilities increased by £13.0 million to £411.0 million (2024: £398.0 million) following an increase in loans and borrowings, offset by a reduction in settlement payables, as noted above.
Net corporate debt was £97.4 million (2024: £67.5 million) and has increased by £29.9 million from the previous year. Positive cash generation from trading has been offset by £14.9 million on the share buyback programme, investments in obconnect and Yodel and working capital requirements in the year, along with tax payments, capital expenditure and dividend requirements. Total loans and borrowings were £102.3 million at the year end, increasing by £8.4 million from 31 March 2024. These consisted of a £45.0 million non-amortising term loan, £58.0 million drawdown of the £90.0 million revolving credit facility and £0.3 million of accrued interest less £1.0 million arrangement fees (2024: £36.0 million of amortising term loans, £57.5 million drawdown from the revolving credit facility, and £0.4 million of accrued interest).
GROUP CASH FLOW AND LIQUIDITY
The following table summarises the cash flow and net debt movements during the year.
Cash generation increased £11.1 million to £69.0 million (2024: £57.9 million) delivered from profit before tax of £26.3 million (2024: £48.2 million). There was a net working capital outflow of £10.3 million (2024: £11.8 million) with trade receivables and inventory levels increasing as the Group grows its revenue and supports new revenue generating initiatives which requires increases in working capital.
Taxation payments on account of £11.4 million (2024: £8.4 million) were higher than the prior year, with payments based on a higher estimated profit before tax. Dividend payments were higher compared to the prior year following an increased interim and final ordinary dividend per share from the prior year ended 31 March 2024. The 3-year share buyback programme commenced on 1 July 2024 and returned £14.9 million cash during the year (2024: £nil).
Capital expenditure of £18.8 million (2024: £16.2 million) was £2.6 million higher than the prior year. Capital expenditure primarily consists of payment terminals including Zebra printers, IT hardware, card terminals and other software development. The increase in capital expenditure is primarily the result of software development investment to modernise heritage systems.
DIVIDENDS
We have declared an increase of 2.1% in the final dividend to 19.6 pence per share (2024: 19.2 pence per share) payable in equal instalments of 9.8 pence per share (2024: 9.6 pence per share) on 11 August 2025 and 26 September 2025 to shareholders on the register on 4 July 2025 and 29 August 2025 respectively. The final dividend is subject to the approval of shareholders at the Annual General Meeting on 6 August 2025.
The final dividend will result in £13.8 million (2024: £14.0 million) being paid to shareholders from the standalone statement of financial position of the Company which, as at 31 March 2025, had approximately £67.2 million (2024: £102.2 million) of distributable reserves.
CAPITAL ALLOCATION
The Group maintains a capital structure appropriate for current and prospective trading over the medium term that allows a healthy mix of returns to shareholders and cash for investments. The Group’s capital allocation priorities have been updated as follows:
GOING CONCERN
The financial statements have been prepared on a going concern basis having regard to the identified principal risks and uncertainties and the viability statement on page 22. Our cash and borrowing capacity provides sufficient funds to meet the foreseeable needs of the Group including dividends.
Rob HardingChief Financial Officer
11 June 2025
PRINCIPAL RISKS AND UNCERTAINTIES
Continuous development and review, whilst maintaining a dynamic and effective risk management process, is vital to support the business in achievement of its strategy and business objectives. Risk management continues to be an essential part of PayPoint’s Corporate Governance.
Changes to principal risks
New risks and disclosures
PayPoint’s risk appetite is determined by the Board and aligns the level of risk considered acceptable in achieving our strategic objectives, increasing financial returns and adhering to statutory requirements. Our risk appetite remains the same as last year.
It is defined as:
Changing risks
Credit and Liquidity/Treasury Management – The name of this risk has been updated to reflect the increasing importance of Counter Party Risk Management to the Group which is now included within the risk profile. This risk is considered to be increasing following recent investment activities aligned to our strategic objectives.
Operational Model – this risk has been renamed as Client Services to more accurately reflect the composition of this risk and its associated risk management strategy.
Other principal risks have remained similar to last year, although they reflect current trends and our risk appetite for each area.
Emerging Risks
ESG and Climate Risk remains an emerging risk. Whilst we recognise the impact climate change is having globally, we continue to be a low-carbon producing company and, as such, these risks do not pose an immediate risk to our operations. We have embedded a strategy of reducing our carbon emissions, with a goal of becoming fully net-zero by 2040 (2030 for our own operations). Details of how we plan to achieve are set out in our annual report.
In 2022 we implemented The Task Force on Climate-related Financial Disclosures (TCFD) which provides companies with a framework to improve reporting on climate-related risks and opportunities. Risks caused by climate change have been embedded into our enterprise risk management framework including our financial planning processes, business case development and our overall risk identification and management processes are set out in our annual report.
The table on pages 18 to 21 sets out our principal and emerging risks and includes: details of the potential impact; mitigation strategies; status of each risk; risk appetite; and exposure trend. They do not comprise all risks faced by the Group and are not set out in order of priority.
VIABILITY STATEMENT
In accordance with the 2018 UK Corporate Governance Code, The Directors have assessed the viability of the Group over a three-year period, taking account of the Group’s current financial and trading position, the principal risks and uncertainties (as set out on pages 18 to 21) and the strategic plans that are reviewed at least annually by the Board.
Assessment periodThe Directors have determined that the Group’s strategic planning period of three years remains an appropriate timeframe over which to assess viability. This broadly aligns to average client renewal terms, new client prospecting and onboarding cycles and the development-through-to-maturity evolution of new products and service lines. The current financing facilities are in place until 2029 broadly in line with this period.
Assessment of prospectsThe Directors assess the Group’s prospects through the annual strategy day in September 2024 and review of the Group’s three-year Plan in March 2025. The planning process forecasts the Group’s financial performance that include cash flows which allow the Directors to assess both the Group’s liquidity and adequacy of funding. In its assessment of the Group’s prospects, the Directors have considered the following: —
The Group’s strategy and how it addresses changing economic environments in the context of our clients, parcel partnerships, merchants, prepay savers and retailer requirements.
In each of our business divisions, we evolve our proposition to specifically address the requirements of our clients and merchants. In the e-Commerce division, we continue to extend our network and offer online customers greater convenience driven by the developing partnerships with carriers. In our Shopping division, our partnership with Lloyds Bank is providing a market-leading banking and card services proposition. In Payments and Banking, leveraging our open banking capabilities (obconnect) to cross- and up-sell our multi-channel payment capabilities, bringing innovation to our targeted sectors. In Love2shop, we continue to integrate our products into new channels (Incomm) and extend adoption of the PayPoint OpenPay service enabling consumers the choice of cash or vouchers. Finally, we are expanding our community cash banking solutions across the UK providing much needed access to cash for consumers, through our retailer partners.
The Group’s inherent resilience to risk.
The Group has an inherent resilience to risk from its diversified proposition across many sectors. This means there are substantial opportunities to continue to provide more key services across all our customers (Retailers, SMEs, Clients, prepay savers and Parcel partnerships). This will ensure we are more integral to all our customers. The business remains highly cash generative, enabling continued investment in key areas of growth to support the Group’s longer-term viability.
Expectations of the future economic environment.
The economic environment remains uncertain. Higher inflation and cost of borrowing have and continue to impact consumer behaviours and confidence. The diversity and necessity of our proposition ensures the business can adapt to ongoing and unexpected changes. A good example of this is the Yodel/Vinted partnership which supports many value seeking consumers with purchases in the previously loved clothing market.
The Group’s financial position.
As at 31 May 2025 the Group had £105.7 million of net debt, split £8.7m cash and £114.4 utilised facilities. Compared to the total facility of £165m means the group has substantial headroom of £59.3m. This level of liquidity is sufficient for all viability scenarios. Furthermore, the Group has proven, robust performance and cash generation in previous economic downturns.
Assessment of viability To assess our viability, we modelled different scenarios identified by considering the potential impact of the principal risks (as shown in the table on pages 18 to 21). Our development of scenarios included reviewing the risks of PayPoint Group, and where appropriate we have made adjustments. Risks are broadly unchanged, the additional investments required to realise our integration and plan targets are included in the plan financial projections. We have reassessed the group’s scenarios to reflect the progress made in delivering our strategy. All ten principal risks were used in our modelling. They were chosen because they combine to represent plausible scenarios covering a range of different operational and financial impacts on the business.In total, three severe but plausible individual scenarios have been modelled, with a fourth reverse stress test scenario. These scenarios and the assumptions within are detailed in the table below. Theoretically all these scenarios, with differing causes could occur together, with varying levels of impact. However, we have not included a combined scenario of scenarios A to C.None of the separate scenarios modelled was found to impact the long-term viability of the Group over the assessment period. In assessing each of the scenarios, we have taken account of the mitigating actions available to us, including, but not limited to reducing discretionary operating spend, reducing non-committed capital expenditure. repricing our products and services, freezing recruitment, reducing variable incentives and temporary suspension of dividend payments.
ConclusionHaving assessed the Group’s current position, potential impacts of principal risks, managing adverse conditions in the past, potential mitigating actions and prospects of the Group, the Directors confirm they have a reasonable expectation that the Group will be able to continue in operation over the next three years and there are no indications that impact the Group’s longer term prospects.
Consolidated statement of profit or loss
Consolidated statement of comprehensive income
Consolidated statement of financial position
These financial statements on pages [24] to [43] were approved by the Board of Directors and authorised for issue on 11 June 2025 and were signed on behalf of the Board of Directors.
Nick WilesChief Executive
Consolidated statement of changes in equity
Consolidated statement of cash flows
Note to the consolidated statement of cash flows - reconciliation of cash and cash equivalents
Notes to the consolidated financial statements
Basis of preparation
PayPoint Plc (‘PayPoint’ or the ‘Company’) is a public limited company limited by shares and is incorporated, domiciled and registered in England in the UK under the Companies Act 2006. The Company’s ordinary shares are traded on the London Stock Exchange. The Group and Company financial statements have been prepared under the historical cost convention except as disclosed in accordance with UK-adopted International Accounting Standards (“UK-adopted IFRS”) and with the requirements of the Companies Act 2006 as applicable to companies reporting under those standards.
The financial information for the year ended 31 March 2025 set out in this document does not constitute the Group’s financial statements for that financial year but is derived from those financial statements. Those financial statements have been reported on by the Group’s auditor, PricewaterhouseCoopers LLP, and will be delivered to the Registrar of Companies in due course. The report of the auditor (i) was unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
These financial statements are presented in Pounds Sterling rounded to thousands (£’000). The Pound Sterling is the currency of the primary economic environment in which the Group operates.
Adoption of standards and policiesNew and amended standards adopted by the Group The Group has adopted the following amendments to standards for the first time in the year ended 31 March 2025:
The accounting policies adopted by the Group in the financial statements for the year ended 31 March 2025 are otherwise consistent with those applied to all other years set out in these group financial statements.
New and revised IFRS in issue but not yet effective No new standards or interpretations have been adopted in the Group’s accounting policies in the year ended 31 March 2025.
At the date of authorisation of these financial statements, the new and revised standards issued but not yet effective are set out below:
It is anticipated that the adoption of these standards and interpretations in future years will have no material impact on the financial statements of the Group, with the exception of IFRS18. IFRS18 will replace IAS1 Presentation of financial statements and will have an impact on the presentation of the Group’s Consolidated statement of profit or loss, with new statutory profit or loss sub-totals and income and expenditure classified into Operating, Investing and Financing categories.
Going concernThe financial statements have been prepared on a going concern basis. The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximising the return to shareholders through the optimisation of the debt-to-equity balance. The capital structure of the Group consists of debt, cash and cash equivalents, restricted funds held on deposit and equity attributable to equity holders of the parent company comprising capital, reserves and retained earnings.
The Group’s policy is to borrow centrally to meet anticipated funding requirements. Our cash and borrowing capacity provides sufficient funds to meet the foreseeable needs of the Group. At 31 March 2025, the Group had corporate cash of £4.9 million.
The Group carried out a refinancing, completed on 6 June 2024, following which its borrowing facilities consisted of:
On 11 June 2025, the Group completed an amendment to the above arrangement, to manage its working capital requirements and capital allocation. Its borrowing facilities now consist of:
At 31 March 2025, £58.0 million (2024: £57.5 million) was drawn down from the £90.0 million revolving credit facility and the outstanding balance of the non-amortising term loan was £45.0 million.
The Group’s statement of financial position shows net assets of £97.3 million as at 31 March 2025 (£121.2 million as at 31 March 2024), having made a profit after tax for the year of £19.3 million (2024: £35.7 million) and generated cash from operations of £74.7 million for the year then ended (2024: £65.7 million). The Group had net current liabilities of £14.0 million (2024: £4.4 million).
The Directors consider the going concern period as twelve months from the date of signing of these financial statements and have reviewed detailed monthly cash flow forecasts from the Group over this period. In this ‘base case’ scenario, the cash flow forecasts show considerable liquidity headroom and debt covenants will be met throughout the period. In addition, the Directors have considered and confirm there are no significant or material events that have been identified beyond the going concern period that may cast significant doubt upon the continuing use of the going concern basis.
Additionally, the Directors have carried out an assessment of the principal risks and uncertainties and applied severe but plausible scenarios, together with a reverse stress test, to test further the Group going concern assumption. These scenarios included a reduction in the volume of transactions caused by a severe economic downturn, transformation and growth plans not delivering intended benefits and material one-off impacts of regulatory, IT or credit loss events. As mitigating actions, we have assumed achievable reductions in expenditure and a reduction in the level of future dividends following the payment of the final dividend of 19.6 pence per share declared in respect of the financial year ended 31 March 2025. The cash flow forecasts included an analysis and stress test for the above scenarios to ensure working capital movements within a reporting year do not trigger a covenant breach.
Based on this assessment the Directors confirm that they have a reasonable expectation that the Group will be able to continue in operation and meet its liabilities as they fall due over the period of not less than twelve months from the date of approval of these financial statements and therefore have prepared the financial statements on a going concern basis.
Use of judgements and estimatesIn the application of the Group’s accounting policies, the Directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered relevant. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the year in which the estimate is revised if the revision affects only that year, or in the year of the revision and future years if the revision affects both current and future years.
Critical judgement: recognition of cash and cash equivalents and restricted funds held on depositThe nature of payments and banking services means that PayPoint collects and holds funds on behalf of clients as those funds pass through the settlement process and retains retailer partners’ deposits as security for those collections. Love2shop also holds, in trust, gift card voucher deposits on behalf of agents, cardholders and redeemers and prepay savers’ cash on behalf of savers.
A critical judgement in this area is whether each of the above categories of funds, and restricted funds held on deposit, are recognised on the consolidated statement of financial position, and whether they are included in cash and cash equivalents for the purpose of the Statement of consolidated cash flows. This includes evaluating:
(a) the existence of a binding agreement, such as a legal trust, clearly identifying the beneficiary of the funds;(b) the identification of funds, ability to allocate and separability of funds;(c) the identification of the holder of those funds at any point in time, and;(d) whether the Group bears the credit risk.
Where there is a binding agreement specifying that PayPoint holds funds on behalf of the client (i.e. acting in the capacity of a trustee) and those funds have been separately identified as belonging to that beneficiary, the cash (referred to as ‘Clients’ own funds’) and the related liability are not included on the consolidated statement of financial position.
In all other cases, the Group has access to the interest on such monies and can, having met certain conditions, withdraw the funds. The cash and corresponding liability are therefore recognised on the consolidated statement of financial position. Corporate cash and cash equivalents consists of cash freely available to the Group for use in its daily operations and is presented as a separate line item on the consolidated statement of financial position from non-corporate cash and cash equivalents, which is not freely available to the Group, either because of self-regulation and segregation or due to contractual or regulatory requirements. Non-corporate cash and cash equivalents comprises:
Both corporate cash and non-corporate cash are included within cash and cash equivalents on the Consolidated statement of cash flows.Restricted funds held on deposit (non-corporate), comprises gift card voucher cash and prepay savers’ cash. However, unlike the gift card voucher cash and prepay savers’ cash included in non-corporate cash and cash equivalents, restricted funds held on deposit (non-corporate) may only be accessed after a minimum of three months. Consequently, they are excluded from cash and cash equivalents on the Consolidated statement of financial position and the Consolidated statement of cash flows.
The amounts recognised on the Consolidated statement of financial position as at 31 March 2025 are as follows:
Critical judgement: assessment of the Group’s Cards division cash generating units (CGUs)Management reassessed its CGUs during the prior period, prompted by the signing of a new partnership with Lloyds Banking Group’s “Cardnet” division in March 2024. This resulted in the creation of a new Cards CGU in the prior period, comprising the former Handepay CGU and Merchant Rentals CGU plus the pre-existing PayPoint cards business.
Consequently, the Group now tests for impairment the aggregate goodwill of £45.2 million which arose on the acquisitions of Handepay and Merchant Rentals, by comparing the enlarged Cards CGU’s recoverable amount to its carrying value. Prior to this CGU reassessment, the Group performed separate impairment tests on the goodwill which arose on the Handepay and Merchant Rentals acquisitions (£35.6 million and £9.6 million respectively) by comparing the recoverable amounts to the carrying values for each of the Handepay and Merchant Rentals CGUs. The consolidation of the former Handepay CGU, Merchant Rentals CGU and PayPoint cards business into a single Cards CGU remains a critical judgement.
Critical estimate: Valuation of acquired intangible assets on acquisition of obconnect LtdThe fair value of acquired intangible assets (customer relationships, brand and developed technology) recognised on the acquisition of obconnect Ltd amounted to £11.0 million, with a related deferred tax liability of £2.7 million. Together with other assets acquired and liabilities assumed, this resulted in goodwill of £12.2 million. The estimate of fair value measurement of acquired customer relationships is considered by management a critical estimate due to a significant risk of material adjustment in the measurement period. The fair value of customer relationships is derived from assumptions, changes to which would have a material impact on its fair value.
The table below summarises the fair value of customer relationships recognised, the assumptions used in deriving the fair value and the range of fair values obtained by changing one or more of the assumptions:
Given that the acquired customer relationships were not purchased in separate transactions, but rather as part of the wider obconnect Ltd business combination, the ‘market participant’ perspective is hypothetical. Therefore, in measuring the acquired customer relationships at fair value, management considered the types of potential market participants (e.g. competitors and comparable companies) to apply assumptions that were consistent with the assumptions that market participants would use when pricing the intangible assets.
Given that the acquired customer relationships are not traded on an active market, have no recent market transactions and are unique to obconnect, management valued them using a multi-period excess earnings (MEEM) method, which reflects market participant fair value by including forecast lifetime earnings which were specifically attributable only to the customer relationships existing at the acquisition date. The discount rate applied to the MEEM incorporates general market rates of return at the acquisition date as well as industry risks and the risks of the asset to typical market participant, based on an analysis of comparable companies.
The residual £12.2 million goodwill represents the future economic benefits arising from the acquisition that were not individually identified and separately recognised at the acquisition date. The buyer-specific synergies subsumed into goodwill did not exist at the market-participant level at the acquisition date because i) they result from combining PayPoint and obconnect Ltd, enabling PayPoint to cross-sell to the obconnect Ltd customer base and ii) the new customer relationships and sectors are anticipated to arise post-acquisition but these were not identifiable at the acquisition date. The workforce and operating expertise are not separately identifiable intangible assets and are also included in goodwill.
Critical estimate: Valuation of the investments in Judge Logistics Ltd
Convertible loan notesAs explained in note 7, the Company held a convertible loan note in Judge Logistics Ltd (“Judge”) at 31 March 2025, which it had purchased for consideration of £15 million during the current period. In accordance with IAS32 Financial Instruments the Company is required to re-measure the loan note at fair value at the end of each reporting period, using an appropriate valuation method. Management used the Probability-Weighted Expected Return Method (“PWERM”), valuing the instrument under each of the different outcomes it identified, and assigning a relative probability to each such outcome.
Management exercised judgement in assigning the relative probabilities. It assigned the highest probability to the scenario which transpired on 17 April 2025, namely the conversion of the Company’s loan note into a 3.6% equity investment in Judge, triggered by InPost spa z.o.o.’s (“InPost’s”) acquisition of Judge. Management assigned lower probabilities to other feasible scenarios.
Management also exercised judgement in estimating the fair value of a 3.6% equity investment. The amount paid by InPost to purchase convertible loan notes in Judge, prior to acquiring 95.5% of it, provided management with observable market information to assist in estimating the fair value of a 3.6% share.
The re-measurement of the Company’s loan note in Judge, from £15.0 million to £2.2 million, resulted in a charge of £12.8 million in the Consolidated statement of profit or loss for the current year, reported within adjusting items (see note 7).
Equity investmentIn addition to the convertible loan note, the Company purchased for £100 an equity investment in Judge in the current year. This investment represented a 0.9% share in Judge following conversion of the Company’s and InPost’s loan notes on 17 April 2025.
With reference to the valuation of £2.2 million derived by the PWERM method for its loan note and the estimated relative probabilities of the possible scenarios, management re-measured the Company’s equity investment in Judge at £0.5 million, resulting in a gain of £0.5 million in the Consolidated statement of profit or loss, reported within adjusting items (see note 7).
Future impactWith the conversion of the Company’s loan note into equity on 17 April 2025, the element of uncertainty relating to the relative probabilities of the scenarios existing at 31 March 2025 was removed. However, the fair value attributable to the Company’s investments in Judge remains subject to estimation. It is reasonably possible that changes to assumptions used by management to estimate the fair value of its investments could give rise to further material adjusting items in the following financial year.
Alternative performance measures Non-IFRS measures or alternative performance measures are used by the Directors and management for performance analysis, planning, reporting and incentive-setting purposes. They have remained consistent with the prior year. These measures are included in these financial statements to provide additional useful information on performance and trends to shareholders.
These measures are not defined terms under IFRS and therefore they may not be comparable with similarly titled measures reported by other companies. They are not intended to be a substitute for IFRS measures.
Underlying performance measures (non-IFRS measures)Underlying performance measures allow shareholders to understand the operational performance in the year, to facilitate comparison with prior years and to assess trends in financial performance. They exclude the impact of one-off, non-recurring and exceptional items and the amortisation of intangible assets arising on acquisition, such as brands and customer relationships.
The adjusting items between the Group’s statutory and underlying performance measures are as follows:
Love2shop billings (non-IFRS measure relating solely to the Love2shop segment)Billings represents the value of goods and services shipped and invoiced to customers during the year and is recorded net of VAT, rebates and discounts. Billings is an alternative performance measure, which the directors believe provides an additional measure of the level of activity other than total revenue. This is due to revenue from multi-retailer redemption products being reported on a ‘net’ basis, whilst revenue from single-retailer redemption products and other goods are reported on a ‘gross’ basis.
Net revenue (non-IFRS measure)Net revenue is total revenue less commissions paid (to retailer partners and Park Christmas Savings agents) and the cost of revenue for items where the Group acts in the capacity as principal (including single-retailer vouchers and SIM cards). This reflects the benefit attributable to the Group’s performance, eliminating pass-through costs to create comparability of performance under both the agent and principal revenue models. It is a key consistent measure of the overall success of the Group’s strategy. A reconciliation from total underlying revenue to net revenue is included in note 4.
Total costs (non-IFRS measure)Total costs comprise other costs of revenue, administrative expenses, finance income and finance costs. Total costs exclude adjusting items, being exceptional costs, amortisation of intangible assets arising on acquisition and net movement on investment fair values.
Earnings before interest, tax, depreciation and amortisation (EBITDA) (non-IFRS measure)The Group presents EBITDA as it is widely used by investors, analysts and other interested parties to evaluate profitability of companies. This measures earnings before interest, tax, depreciation and amortisation. See page 11 for a reconciliation from profit before tax to EBITDA.
Adjusted earnings before interest, tax, depreciation and amortisation (Underlying EBITDA) (non-IFRS measure)The Group also presents adjusted EBITDA, which comprises EBITDA, as defined above, excluding exceptional items and net movements on convertible loan notes and other investments. See page 11 for a reconciliation from profit before tax to adjusted EBITDA.
Underlying earnings per share (non-IFRS measure)Underlying earnings per share is calculated by dividing the net profit before adjusting items attributable to equity holders of the parent by the basic or diluted weighted average number of ordinary shares in issue.
Underlying profit before tax (non-IFRS measure)Underlying profit before tax represents statutory profit before tax excluding adjusting items.
Net corporate debt (non-IFRS measure)Net corporate debt represents corporate cash and cash equivalents less bank overdraft and amounts borrowed under financing facilities (excluding IFRS 16 liabilities). The reconciliation of corporate cash and cash equivalents to net corporate debt is as follows:
2. Segmental reporting Segmental information
The Group considers its Love2shop business to be separate segments from its legacy PayPoint business, since discrete financial information is prepared for Love2shop and PayPoint and they offer different products and services. Furthermore, the chief operating decision maker (CODM) reviews separate monthly internal management reports (including financial information) for Love2shop and PayPoint to allocate resources and assess performance.
The material products and services offered by each segment are as follows:
PayPoint
Love2shop
Information related to each reportable segment is set out below. Segment profit / (loss) before tax and adjusting items is used to measure performance because management believes that this information is the most relevant in evaluating the results of the respective segments relative to other entities that operate in the same industries.
A business division analysis of revenue has been provided in note 3.
The £310.7 million (2024: £306.4 million) total revenue and £237.8 million (2024: £222.5 million) non-current assets at 31 March 2025 are geographically located within the UK.
3. Revenue Disaggregation of revenue
Service fee revenue of £21.8 million (2024: £19.7 million) and management fees, set-up fees and upfront lump sum payments of £1.1 million (2024: £1.3 million) are recognised on a straight-line basis over the period of the contract. Card terminal leasing revenue of £10.6 million (2024: £8.7 million) is recognised over the expected lease term using the sum of digits method for finance leases and on a straight-line basis for operating leases. Multi-retailer voucher, card and e-code service fee revenue is recognised on redemption by the customer. The remainder of revenue is recognised at the point in time when each transaction is processed. The usual timing of payment by PayPoint customers is on 14-day terms. The usual timing of Love2shop’s corporate customers is 15-day terms; its consumer customers pay on ordering.
Revenue subject to variable consideration of £14.1 million (2024: £13.6 million) exists where the consideration to which the Group is entitled varies according to transaction volumes processed and rate per transaction. Management estimates the total transaction price using the expected value method at contract inception, which is reassessed at the end of each reporting year, by applying a blended rate per transaction to estimated transaction volumes. Any required adjustment is made against the transaction price in the year to which it relates. The revenue is recognised at the constrained amount to the extent that it is highly probable that the inclusion will not result in a significant revenue reversal in the future, with the estimates based on projected transaction volumes and historical experience. The potential range in outcomes for revenue subject to variable consideration resulting from changes in these estimates is not material.
Love2shop revenue is recorded net of corporate discounts.
Other revenue comprises:
4. Alternative performance measures
Net revenue
The reconciliation between total underlying revenue and net revenue is as follows:
Total costs
Total costs, excluding adjusting items, comprises:
5. Exceptional items
The tax impact of the exceptional items is £5,859,000 (2024: £1,305,000).
Exceptional items are those which are considered significant by virtue of their nature, size or incidence. These items are presented as exceptional within their relevant income statement categories to assist in the understanding of the performance and financial results of the Group, as they do not form part of the underlying business.
Claim settlementThe current year deduction against revenue relates to the Group’s settlement of a claim brought against it by Utilita, as disclosed in note 12. The claim was settled after the year-end date and has been treated as an adjusting event in accordance with IAS10 Events after the reporting period.
Legal feesThe current year charge relates to the Group’s defence of two claims served on a number of its companies in connection with the issue disclosed in note 12. The Group remains confident that it will successfully defend the claim served by Global-365.
Chapel St. The costs arise from the Group’s decision to vacate part of its leased Chapel Street, Liverpool premises in February 2025. Following the decision, the Group will continue to pay rent until June 2029, five years short of the original lease termination date. Consequently, the lease liability and associated right of use asset were remeasured in the current year and the reduced right of use asset fully impaired, along with other assets in the vacated space.
In addition, the Group has recognised an onerous contract provision for unavoidable costs related to the vacated space.
ERP system amortisationThe current year accelerated amortisation costs relate to Love2shop’s ERP system. As part of an e-commerce project initiated in the current period, certain modules of that system will be replaced by 31 March 2025, earlier than the previously expected date.
Restructuring costsThe prior year restructuring costs relate to the organisational design of the Group communicated by management to all staff on 6 March 2024.
Refinancing costsThe prior year refinancing costs comprise legal and professional fees incurred by the Group in respect of its borrowing facilities referred to in note 1 and the write-off of the unamortised balance of capitalised costs arising on the previous refinancing exercise.
6. Tax
The income tax charge is based on the UK statutory rate of corporation tax for the year of 25% (2024: 25%). Deferred tax has been calculated using the enacted tax rates that are expected to apply when the liability is settled, or the asset realised. Deferred tax has been calculated based on the rate applicable at the date timing differences are expected to reverse.
The income tax charge of £7.0 million (2024: £12.5 million) on profit before tax of £26.3 million (2024: £48.2 million) represents an effective tax rate1 of 26.6% (2024: 25.9%). This is higher than the UK statutory rate of 25% due to adjustments in respect of disallowable expenses, share-based payments and prior year adjustments.
The tax charge for the year is reconciled to profit before tax, as set out in the consolidated statement of profit or loss, as follows:
1Effective tax rate is the tax cost as a percentage of profit before tax.
Given the Group’s effective tax rate, its annual revenue and that it has no overseas operations, the Group assesses that the Organisation for Economic Co-operation and Development’s Pillar Two tax regime will have no impact on it.
7. Investments
Convertible loan notes The movements in the fair values of the convertible loan note investments in the prior and current years are as follows:
Judge Logistics LtdThe Group’s £15 million investment in Judge Logistics Ltd was purchased in three stages (£10 million on 21 June 2024, £3 million on 31 July 2024 and £2 million on 30 September 2024). Judge Logistics Ltd is the parent company of Yodel Ltd, a customer in the Group’s e-commerce parcel business.
At 31 March 2025 the Company revalued its investment to fair value in accordance with IAS32 Financial Instruments. It elected to use the Probability-Weighted Expected Return Method (“PWERM”), under which the Directors identified various future scenarios for its investment and assigned a relative probability and valuation for each such scenario. They considered the most probable outcome to be that which transpired on 17 April 2025, namely the conversion of the Company’s loan note into equity, following the acquisition of Judge Logistics Limited by InPost sp z.o.o. The fair value derived from the above valuation method was £2.2 million, with the £12.8 million loss recorded within adjusting items .
obconnect LtdThe Company purchased a convertible loan note of nominal amount £3.0 million on 7 July 2022 from obconnect Ltd, which provides open banking services to banks and other financial institutions. Based on the key terms of the convertible loan note and investment agreement, the investment was recognised at fair value, with any gains or losses recognised through the statement of profit or loss.
The fair value as at 31 March 2024 determined using the discounted cash flow method was £3,689,000. Management therefore recognised a £689,000 gain in the statement of profit or loss in the prior year, reported within adjusting items.
The loan converted into a 22.5% equity stake in obconnect Ltd’s ordinary shares on the Company’s acquisition of a majority shareholding in obconnect Ltd on 30 October 2024 (see note 8). On that date, the fair value of the convertible loan note was £6,117,000, the increase of £2,428,000 reflecting the continued trading improvements of obconnect Ltd in the seven months since 31 March 2024 and an observable market price provided by the price per share paid by the Company to acquire control of obconnect Ltd.
Aperidata LtdThe Company purchased a convertible loan note in Aperidata Ltd in May 2024 for consideration of £1.0 million. Aperidata Ltd provides credit reporting and open banking services to consumers and businesses. The loan converts into an equity stake in Aperidata Ltd’s ordinary shares on 23 May 2027, such that the Company’s aggregate equity stake in Aperidata Ltd following conversion will be 42.97%, including its diluted, direct equity investment referred to below.
The current year discounted cash flow valuation is based on a 5-year forecast extrapolated to perpetuity, using the following financial assumptions. The discount rate reflects management’s view of the level of risk associated with the business:
The fair value derived from the above valuation method was £1.0 million.
Other investmentsThe movements in the fair values of the equity investments in the prior and current years are as follows:
Judge Logistics LtdDuring the year the Company acquired 17.3% of the ordinary share capital of Judge Logistics Ltd for consideration of £100, in addition to the convertible loan note in Judge Logistics Ltd referred to above.
At 31 March 2025 the Company revalued its investment to fair value in accordance with IAS32 Financial Instruments. It elected to use the Probability-Weighted Expected Return Method (“PWERM”), under which the Directors identified two future scenarios for its investment and assigned a relative probability and valuation for each such scenario. The fair value derived from the above valuation method was £0.5 million, with the £0.5 million gain recorded within adjusting items.
obconnect LtdIn the year ended 31 March 2023 the Company acquired 2.5% of the ordinary share capital of obconnect Ltd for consideration of £251,000, in addition to the convertible loan note in obconnect Ltd referred to above. In the current year, the Company increased the fair value of this investment to £516,000, the increase of £265,000 reflecting the continued trading improvements of obconnect Ltd. This 2.5% shareholding ceased to be treated as a separate investment, following the Company’s current year acquisition of obconnect Ltd.
Aperidata LtdDuring the year the Company acquired 19.9% of the ordinary share capital of Aperidata Ltd for consideration of £0.2 million, in addition to the convertible loan note in Aperidata Ltd referred to above. The current year discounted cash flow valuation of this investment is £0.2 million.
8. Acquisition of subsidiary
On 30 October 2024, PayPoint acquired a further 52.8% of the share capital of obconnect Ltd for consideration of £17.2 million, comprising cash of £10.5 million plus the fair values of its convertible loan note (£6.1 million) and existing 2.5% equity investment (£0.5 million) and stamp duty of £0.1 million. The convertible loan note converted into 22.5% equity as part of the acquisition, within the total 55.3% acquired. The acquisition resulted in a net £8.9 million cash outflow (net of cash acquired) in the current year.
The primary reason for the acquisition was to further leverage obconnect Ltd’s technology platform, offering its Open Banking services to both new and existing clients.
In accordance with IFRS3 Business Combinations, the Group identified and recognised the following intangible assets as part of the fair value exercise. The assets are being amortised over useful lives as shown:
In the period since acquisition, obconnect Ltd contributed revenue of £1.8 million and profit before tax of £0.3 million to the Group’s results. Had the acquisition taken place on the first day of the financial year, obconnect Ltd would have contributed revenue of £4.5 million and profit before tax of £0.2 million.
Acquisition costs incurred in the year in relation to obconnect totalled £0.1 million, which are reported within administrative expenses in the Consolidated statement of profit or loss.
The following table summarises the provisional fair values of the identifiable assets purchased and liabilities assumed at the acquisition date:
The acquired identifiable assets and liabilities have been recognised at their fair values at acquisition date and in accordance with the Group’s accounting policies:
• The acquired customer relationships including order backlogs have been valued using the multi-period excess earnings method (“MEEM approach”) by estimating the total expected income streams from the customer relationship and deducting portions of the cash flow that can be attributed to supporting, or contributory, assets (including workforce). The order backlog is estimated based on the expected revenue to be received, less the costs to deliver the service. The residual income streams are discounted. No tax amortisation benefit is applied. The key inputs to this method are the customer churn rate, revenue growth rate and discount rate applied to future forecasts of the businesses.• Acquired brands have been valued using the relief-from-royalty method.• Acquired software intangible assets have been valued using the depreciated replacement cost method, considering factors including economic and technological obsolescence. • Trade receivables and trade payables have been assessed at fair value on the basis of the contractual terms and economic conditions existing at the acquisition date, reflecting the best estimate at the acquisition date of contractual cash flows not expected to be collected.
The following acquired assets and liabilities were valued using management’s best estimates based on information available at the acquisition date, which are therefore subject to adjustment within the measurement period if new information about facts and circumstances that existed at the acquisition date is obtained and, if known, would have resulted in the recognition of those assets and liabilities at that date.
Of the £12.2 million goodwill acquired during the year, no goodwill is expected to be deductible for tax purposes. The goodwill arising on the acquisition is attributable to workforce, synergies, growth from new customers and other assets not separately recognised.
A non-controlling interest (NCI) of £4.0 million arose on the acquisition, measured as 44.7% of the £8.9 million fair value of net assets acquired. The NCI’s share of post-acquisition profit in the current year was £0.1 million, resulting in an NCI balance of £4.1 million, reported within total equity in the Consolidated statement of financial position.
9. Provisions
In February 2025 the Group decided to vacate part of its Chapel St. premises in Liverpool. Consequently, in accordance with IAS37 Provisions, contingent liabilities and contingent assets, it has recognised a provision for unavoidable costs related to the lease agreement.
In May 2025 the Group settled a claim which had been served by Utilita in 2023 (see note 12). The claim settlement is treated as an adjusting event in the year ended 31 March 2025 and consequently the Group has recognised a provision at that date for the full £14.2 million settlement amount.
The current year provision utilisation relates to the group-wide review of its organisational structure which PayPoint conducted in the prior year. All related payments were made to the employees impacted by the restructuring between April and October 2024.
The prior year Company balance was classified as non-current.
10. Share capital, share premium and merger reserve
On 13 June 2024, the Group announced a share buy-back programme of at least £20.0 million over a 12-month period. In accordance with IFRS9, the Group recognised an initial liability for the full £20.0 million, with a corresponding reduction in retained earnings. The £14.9 million cost of shares purchased under the programme to 31 March 2025 is recorded against the liability. A total of 2,031,817 shares were purchased, with a nominal value of £6,773. This resulted in a reduction in Share capital of £6,773 and the creation of a corresponding Capital redemption reserve balance.
Partly offsetting the impact of the share buy-back programme,146,394 shares (of 1/3p each) were issued in the current year for share awards which vested in the year and 25,910 matching shares (of 1/3p each) were issued under the Employee Share Incentive Plan.
The share premium of £1.0 million (2024: £1.0 million) represents the payment of deferred, contingent share consideration in excess of the nominal value of shares issued in relation to the i-movo acquisition.
The merger reserve of £18.2 million (2024: £18.2 million) comprises £1.0 million initial share consideration in excess of the nominal value of shares issued on the initial acquisition of i-movo and £17.2 million share consideration in excess of the nominal value of shares issued in relation to the Love2shop acquisition.
11. Notes to the statements of cash flow
12. Contingent liability
Ofgem’s Statement of ObjectionsIn FY24, a number of companies in the PayPoint Group, including PayPoint Plc, received two claims relating to issues addressed by commitments accepted by Ofgem in November 2021 as a resolution of Ofgem’s concerns raised in its Statement of Objections received by the PayPoint Group in September 2020. The Ofgem resolution did not include any infringement findings. The first claim was served by Utilita Energy Limited and Utilita Services Limited (subsequently renamed Luxion Sales Limited) (“Utilita”) on 16 June 2023. The second claim was served by Global-365 plc and Global Prepaid Solution Limited (“Global 365”) on 18 July 2023.
HMRC assessmentIn February 2024, HMRC raised an assessment on the Group’s tax position for the accounting period ended 31 March 2021. The Group has appealed the assessment on the grounds that it is not valid from a tax technical and administrative perspective and no provision has therefore been recognised.
13. Events after the reporting date
Conversion of loan note investment in Judge Logistics LtdOn 17 April 2025 the Company’s £15.0 million convertible loan note investment in Judge Logistics Ltd converted to an 3.6% equity share. The conversion was triggered by InPost spa. z.o.o. acquiring a controlling equity share in Judge Logistics Ltd by converting its loan note investment into equity. See note 7.
Share buy-backOn 12 June 2025 the Group announced that the share buy-back programme, which it began on 1 July 2024 for an initial 12-month period, would be extended until the end of March 2028. The Group plans to purchase at least £30 million of shares per annum. It will continue to review the programme based on business performance, market conditions, cash generation and the overall capital needs of the business. This is a non-adjusting event, having no impact on the current year financial statements.
Settlement of legal claimOn 13 May 2025 the Group settled the legal claim with Utilita referred to in note 12. The total settlement amount was £14.2 million, recorded in the current year as an exceptional revenue deduction and a provision. See notes 5 and 9.
1 Underlying EBITDA (EBITDA before exceptional items and net movements on convertible loan notes and other investments) is an alternative performance measure. Refer to the Financial Review for a reconciliation to profit before tax.2 Underlying profit before tax (profit before tax excluding adjusting items) is an alternative performance measure. Refer to the Financial Review for a reconciliation to profit before tax.3 Net revenue is an alternative performance measure. Note 4 to the financial information reconciles from total underlying revenue to net revenue. Total underlying revenue of £324.9 million is stated before the £14.2 million exceptional revenue deduction explained in notes 5 and 12 to the financial information.4 Adjusting items comprises exceptional items (£14.2 million claim settlement and £6.4 million for legal costs related to claims against PayPoint, £2.0 million related to lease exit costs in Love2shop and £0.8m accelerated amortisation of intangible assets), £9.6 million net decrease in fair value of the investments held in obconnect and Yodel, and amortisation of intangible assets arising on acquisition (£5.8 million for Love2shop and £2.9 million for PayPoint). Refer to note 1.5 Diluted underlying earnings per share is an alternative performance measure, Refer to note 1 to the financial information.6 Net corporate debt (excluding IFRS 16 liabilities) is an alternative performance measure. Refer to note 1 to the financial information for a reconciliation to cash and cash equivalents.7 Current year statutory revenue is reported net of a £14.2 million exceptional deduction related to a claim settlement.7 Exceptional items comprises £20.6 million for settlement and legal costs related to claims against PayPoint, £2.0 million related to lease exit costs in Love2shop and £0.8m accelerated amortisation of intangible assets8 Net revenue is an alternative performance measure. Refer to note 4 to the financial information for a reconciliation to underlying revenue.9 Underlying profit before tax is an alternative performance measure. see above for a reconciliation to profit before tax.10 Underlying EBITDA is an alternative performance measure. Refer to page 11 for a reconciliation to profit before tax.11 Net corporate debt (excluding IFRS 16 liabilities) is an alternative performance measure. Refer to note 1 to the financial information for a reconciliation to cash and cash equivalents.
12 Excludes exceptional depreciation of £0.8 million related to the Chapel St. lease and exceptional amortisation of £0.9 million related to Love2shop’s ERP system, both of which are included in the £33.0 million exceptional items
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