Paypoint profits jump but mobile is a drag

26th May 2011 11:08

Paypoint posted a 5.5% rise in profits after seeing record transaction volumes of 590m in the year to the end of March.The electronic payment services provider reported pre-tax profits of £34.5m up from £32.6m the year previously.The increased profit came despite a 1.6% fall in revenues to £193m.The reduction arose from a decrease in mobile top-ups and from the impact of merchant service charges on card transactions being charged direct to merchants rather than through PayPoint.net, the firm said.This was reflected in Paypoint's UK retail services network where net revenue jumped 25%, but was constrained by a decline in profits from mobile top-ups as operators offered more airtime at lower cost.Chairman, David Newlands, said internet net revenues have increased 20% and the business had notable success in winning gaming merchants, including Stan James, 32 Red and Sportingbet."We are continuing to win gaming business because of our robust and resilient platform, innovation, advanced fraud and risk management capabilities, and real-time enterprise level reporting," he said.The firm said trading for the current financial year was in line with expectations and proposed a final dividend of 15.6 pence per share.This takes the total for the year of 23.4 pence, an increase of 7.3%.Paypoint said it had cash of £26.5m (including client cash of £6.1m). It also had a new £35m five year banking facility that has been agreed since the financial year end, it said.---mm