The directors of PayPoint plc are pleased to announce that profits before tax are running ahead of expectations. 

Strong growth in transaction volumes for prepaid energy, bill payment and mobile top-ups, particularly those carried out on retailers’ own till systems, have resulted in better than expected turnover growth. Going forward, mobile top up growth is expected to slow down.

Gross margins have declined as predicted, largely as a result of the growth in Irish mobile top-up revenues, where PayPoint is principal in the transaction with the consumer and therefore includes the full value of the top-up in turnover and the cost in cost of sales.

The migration of mobile top-up transactions from PayPoint terminals to certain multiple retailers’ own till systems has now started, but one multiple retailer has not completed the software development necessary for the change to take place, although this is expected during the second half of the year.  Mobile top-ups on retailers’ own till systems produce lower revenues for PayPoint.  The impact of this migration and other factors such as depreciation, will tend to make the split of the first half and second half profits more evenly balanced than last year.

Operating margins (earnings before interest and taxes expressed as a percentage of revenue) have increased despite the additional cost of strengthening the management team for future growth.

Enquiries

Finsbury                                             

Rollo Head

Don Hunter                                                            020 7251 3801 

About PayPoint

PayPoint is a leading branded payment collection network used, primarily, for the cash payment of bills and services and prepayments for mobile telephones and energy meters. There are over 13,000 retail outlets using PayPoint’s payment terminals.

PayPoint began trading in 1996 and initially collected payments through its network of retail agents for its founder client investors, who included British Gas, BT, BBC TV Licensing, London Electricity (now part of EDF Energy) and four water companies.

It now has more than 500 clients including many of the UK and Ireland’s major energy, cable, mobile and fixed line telephony companies. Its blue chip client list also extends to numerous water companies, local authorities and housing associations and a growing transport and travel base.