Retail network growth pushes PayPoint revenue higher

Payment systems provider PayPoint posted its preliminary results for the year to 31 March on Thursday, claiming “good growth” in its core retail networks as gross revenue rose 3.6% to £203.4m.

The FTSE 250 company said net revenue grew 6.2% to £117.5m, while operating profit improved 1.1% to £53.3m.

Retail services net revenue grew to £39.9m - an increase of 31.6% - as the firm also benefited from a profit on the sale of its mobile division of £19.5m.

Mobile sale proceeds of £26.5m were returned to shareholders, with goodwill of £30.8m having been fully impaired in 2016

The board declared a final ordinary dividend of 30p per share, making for a total ordinary dividend of 45p per share, or an increase of 6.1%.

An additional dividend of 36.7p per share was being paid as part of the company’s commitment to return surplus cash to shareholders over a five year period to 2021.

As a result, total dividends of 120.6p per share were being paid to shareholders for the year to 31 March 2017

PayPoint held cash and cash equivalents at year end of £53.1m, with net cash generated from operating activities of £42.2m.

“We have continued to deliver a significant transition in our business to respond to the needs of our retail clients and the changing world of payments,” said chief executive officer Dominic Taylor.

“Our transition has involved the sale of our mobile business, a renegotiated agreement with our partner on Collect+ and, most importantly, launched our new terminal PayPoint One, which includes an industry-leading EPoS solution.”

Taylor said the year had seen further “good growth” in PayPoint’s core retail network, with net revenue up 6% and an increase in sites of 3%, up to 40,500.

“Looking beyond the current financial year, I see significant opportunities for our retail services business, accelerating the growth of ATM's, parcels and EPoS and we will continue to work to build our retailer relations.

“Our strategy is supported by balance sheet strength and the ability to continue to make superior returns to shareholders.”