• PayPoint’s UK terminal and ATM business had like-for-like[3] net revenues up 6% and operating costs down 3%.
• UK terminal network expanded by nearly 900 sites to 20,772 - on track to meet target of 1,500 Additional terminals for the year.
• ATM network has increased by 7% and internet merchants have grown by 6% since March 2008.
• New website and restructured marketing is generating increased leads for our internet business.
• Romanian bill payment service launched in August with 1,200 branded PayPoint sites.

Operating profit growth in the UK terminal and ATM business was up 22% on a like-for-like[3] basis, including a slight decline in mobile transactions and in ATM transactions per terminal, suffered in common with other Providers. The terminal network in the UK has been expanded to service transaction growth and mitigate the decline in mobile volumes and the ATM estate compared to last year.

Our internet companies have been integrated to operate successfully as a single business, PayPoint.net, and its new website and marketing programmes have driven more leads, which will increase the number of merchants using our service. This, combined with the introduction of PayCash, which permits the payment in cash at PayPoint convenience stores for consumer purchases online, positions our internet business for growth.

In Romania, we have launched bill payment alongside the existing mobile top-up business and transaction volumes are growing as expected with the four launch clients and with a further four to follow before the year end. We also have strong interest from other substantial bill issuers with whom we expect to sign contracts.  We continue to invest in the roll-out of terminals in Romania at a rate faster than we anticipated last year and this, together with the delayed transfer of the transaction processing to the UK and the launch of bill payment, has held back the results. We expect the business to be profitable next year.

David Newlands, Chairman, said: “PayPoint has delivered first half results ahead of market expectations. There are new products and prospects in the UK and elsewhere, which provide ample opportunity for management to continue to deliver growth.”

The condensed financial statements cover the 26 week period from 31 March 2008 to 28 September 2008, the last Sunday in the month, compared to a 27 week period ended 30 September 2007.

1 Net revenue is revenue less commissions paid to retail agents, acquiring bank charges and the cost of mobile top-ups where PayPoint is the principal.

2 Net revenue and operating margin are measures which the directors believe assist with a better understanding of the underlying performance of the group. The reconciliation of net revenue to statutory amounts can be found in note 2.

3 The like-for-like basis adjusts the comparative period to 26 weeks.