Paypoint plc Paypoint Plc : Trading Update For The Three Months Ended 30 June 2017

 
TIDMPAY 
 
   PayPoint plc 
 
   Trading update for the three months ended 30 June 2017 
 
   26 July 2017 
 
 
   -- Group1 organic net revenue2 grew 4.2% from GBP27.3 million to GBP28.4 
      million 
 
   -- UK retail services net revenue grew by 10.5% driven by PayPoint One, card 
      payment transactions and ATM transactions 
 
   -- Romania net revenue, reported in constant currency, grew by 16.1% 
 
   -- UK parcel volumes grew by 16.6% to 6.1 million in the quarter 
 
   Dominic Taylor, PayPoint's Chief Executive, commented: 
 
   'We have continued our repositioning of the business in the new 
financial year, as we have driven profitable growth in UK retail 
services, increased parcel volumes and delivered another strong 
performance in Romania. The successful roll out of our innovative new 
PayPoint One terminal in the UK continues, following its launch last 
September. We are on target to achieve 8,000 installations by the end of 
this financial year, with 5,000 terminals already in service. This good 
progress underpins the Board's confidence in our strategy and our full 
year outlook remains in line with previous guidance.' 
 
 
 
   Performance(3) for the first quarter period ending 30 June 2017 
 
   Group(1) organic net revenue grew 4.2% from GBP27.3 million to GBP28.4 
million despite a 4.5% reduction in transaction volumes to 150.3 million, 
as a result of an expected decline in our UK prepay energy volume, which 
was partially offset by growth in our net revenue per transaction 
through a shift to smaller but higher yielding clients, combined with 
strong growth in our MultiPay platform, through which transactions 
doubled to 3.3 million. On a reported basis including the results of 
PayByPhone, which was sold on 23 December 2016, net revenue reduced 4.0% 
from GBP29.6 million to GBP28.4 million. 
 
   UK and Ireland retail services net revenue was up 10.5% driven by 
PayPoint One service fees, card payment transactions which grew by 8.3% 
to 24.1 million and ATM transactions which increased 5.0% to 10.2 
million. Our PayPoint One terminal, which launched in September 2016, is 
now in operation in 5,000 sites(3) , an increase of 1,296 since the 
beginning of this financial year. We remain on target to reach 8,000 
sites by 31 March 2018. Due to the strong take up of PayPoint One by our 
retailers, we have introduced and standardised the service fees for 
legacy terminals across 14,000 sites. As expected, this caused a small 
amount of retailer churn and our UK network reduced by 449 during the 
first quarter to 28,727 outlets. We are also pleased with the 
performance of our parcel service, which increased volume by 16.6% to 
6.1 million. The Collect+ network expanded to 6,521 sites up by 354 
since the beginning of the financial year. 
 
   As anticipated, net revenue in bill and general decreased by 2.7% as 
transaction volume declined by 11.2%, driven mainly by a 15.1% reduction 
in prepay energy volume, with the shift in mix towards smaller but 
higher yielding clients partially offsetting the decrease in 
transactions. Top-up transactions declined by 14.4% as the prepaid 
mobile sector continued to contract. 
 
   Romania continued to grow, net revenue reported in constant currency 
increased by 16.1% and in GBP increased by 25.3%. Total transactions 
increased 9.1% from last year to reach 19.3 million. Our Romanian 
network continued to expand with PayPoint at 11,477 retailer sites at 30 
June 2017, up 175 since the beginning of the financial year. 
 
   Balance sheet at 30 June 2017 
 
   The group had net cash of GBP56.9 million (31 March: GBP53.1 million) 
including the balance held in respect of short term client settlement 
obligations which was GBP17.6 million (31 March: GBP20.2 million). 
 
 
 
 
Enquiries                                           Finsbury (Tel: [phone] 
 PayPoint plc                                       801) 
Dominic Taylor, Chief Executive (Tel: [phone]     Rollo Head 
317) 
Rachel Kentleton, Finance Director (Tel: [phone]  Andy Parnis 
 906) 
 
   ABOUT PAYPOINT 
 
   We operate market leading national networks across 40,100 convenience 
stores in the UK and Romania so that our customers are always close to a 
PayPoint store. At these locations, whether at home or on the move, 
people use us to better control their household finances, make essential 
payments and use in-store services, like parcel drop and collect. 
 
   Our UK network contains more branches than all banks, supermarkets and 
Post Offices together, putting us at the heart of communities for over 
10 million regular weekly customers. 
 
   We have a proven track record of decades of tech-led innovation, 
providing retailers with tools that attract customers into their shops. 
Our recently launched PayPoint One platform offers EPoS, card payments 
and PayPoint services, and is designed to help retailers run their whole 
store from one device. 
 
   Coupled with our industry-leading solutions, we provide a first class 
service to the customers of over 300 clients - utility companies, 
retailers, transport firms, mobile phone providers, government and more. 
 
   We are on and offline; providing for payments by cash, card including 
contactless; retail, phone and digital; at home, work and whilst out and 
about from Land's End to the Highlands and Islands - helping to keep 
modern life moving. 
 
   Multichannel payments 
 
   MultiPay is our multichannel payment service, offering consumer service 
providers a ready-made solution for their full range of payments via app, 
web, phone, text and IVR, complementing our cash in store services. 
 
   Clients benefit from streamlining their consumer payment processing and 
transaction routing in a seamlessly integrated and cost effective 
solution. The services are available either as a full portfolio or by 
the client's choice of preferred channels, including our app which has a 
4 star rating on the Google Play and Apple App Stores. Clients can 
choose to access our services as a full outsourced model or by linking 
their own digital solutions to our MultiPay payment suite. 
 
   MultiPay is particularly targeted to serve the rollout of smart meters 
within the energy market. For example, our service has helped Utilita to 
become the fastest growing, challenger prepay energy supplier and we 
have also signed several other energy companies, including SSE, our 
first Big 6 energy client. Among other relevant sectors, MultiPay is 
available to the local authority and social housing sectors through a 
framework with Procurement for Housing. 
 
   Retail networks 
 
   In the UK, our network includes over 28,700 local shops including Co-op, 
Spar, Sainsbury's Local, Tesco Express and thousands of independent 
outlets. These outlets are quick and convenient places to make energy 
meter prepayments, bill payments, benefit payments, mobile phone top-ups, 
transport ticket payments, TV licence payments, cash withdrawals and 
more. 
 
   Our Romanian network continues to grow profitably. We have more than 
11,400 local shops, helping people to make cash bill payments, money 
transfers, road tax payments and mobile phone top-ups. Our clients 
include all the major utilities and telcos and many other consumer 
service companies. 
 
   In the UK, our Collect+ network offers parcel collection and return 
services in over 6,500 convenient outlets. Customers use Collect+ for 
their parcels from major retailers including Amazon, eBay, ASOS, New 
Look, John Lewis, House of Fraser, M&S and Very. The Collect+ brand is 
jointly owned with Yodel. 
 
   The UK network also includes over 4,100 LINK branded ATMs, and 9,700 of 
our terminals enable retailers to accept debit, credit and contactless 
payments, including Apple Pay. We operate over 4,100 Western Union 
agencies in the UK and Romania for international and domestic money 
transfers. 
 
   1 Group consists of our UK, Ireland and Romanian retail networks and 
excludes PayByPhone which was sold on 23 December 2016. 
 
   2 Net revenue is revenue less the cost of mobile top-ups (where PayPoint 
is principal), SIM cards and other costs incurred by PayPoint which are 
recharged to clients and merchants. These costs include retail agent 
commission, card payment merchant service charges and costs for the 
provision of call centres for PayByPhone clients. Net revenue is a 
measure which the directors believe assists with a better understanding 
of the underlying performance of the group. 
 
   3 At 30 June 2017 PayPoint One was in 4,897 sites. 
 
   4 PayPoint's auditors have not been requested to review the performance 
or financial position. 
 
   PayPoint Trading update for the three months ended 30 June 2017: 
http://hugin.info/137093/R/2122987/809645.pdf 
 
   This announcement is distributed by Nasdaq Corporate Solutions on behalf 
of Nasdaq Corporate Solutions clients. 
 
   The issuer of this announcement warrants that they are solely 
responsible for the content, accuracy and originality of the information 
contained therein. 
 
   Source: PayPoint plc via Globenewswire 
 
 
  http://www.paypoint.co.uk/default.htm 
 

(END) Dow Jones Newswires

July 26, 2017 02:00 ET (06:00 GMT)

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