Top story

Revenues at PayPoint slipped in the first half following the disposal of its online payment businesses but underlying operating profits increased 15.6% to £24.7m as the payment technologies company lowered costs.

Net revenue at the group, which counts the likes of Co-op, Spar, McColls, Asda and thousands of independents in its retail network, fell 1.5% to £58.4m and total revenues declined 1.1% to £101.7m.

Transaction volumes were also down in the six months to 30 September to 337.2 million, compared with 399 million in the same period a year ago, with a transaction value of £4.9bn, down from £7.2bn.

PayPoint said that excluding the results of the online payments business, which was sold for £14m to Capita in January, net revenues grew year on year by 5.1%, overall revenues were up 2.7%, transactions by 0.1% and transaction values by 0.4%.

Its retail networks produced net revenue growth of 2.8%, a slowdown from 3.5% a year ago, fuelled by strong growth from Romania of 23.9% and 1.3% from UK and Ireland.

PayPoint said PayPoint One, the tablet-style terminal, had been well received by retailers, but revenues were lower than anticipated as roll outs of the older terminals were stopped and demand for upgrades was stronger than expected.

Bill and general transactions decreased 4%, with revenues in the division down 1.9% to £37.8m, as energy transactions continued to decline. Top-up transactions also reduced 14.1% as a result of the continued decline in the mobile top-up volumes in the UK.

Net revenue growth of 14.7% to £25.7m in retail services was greater than transaction growth and was driven by bonuses earned on SIM activations and increased retailer service fees for PayPoint One, card payment service fees and broadband enabled terminals.

The mobile business also increased revenues by 38% to £6.3m.

CEO Dominic Taylor said: “Overall results are in line with our expectations. As set out in our last full year results announcement, this year is proving to be pivotal as we change the focus of the organisation towards our retailers.

“In the first half, the commercial trial of our new PayPoint One terminal and Core EPoS were successfully concluded with the official launch in September. The platform has been well received and will enable us to drive further growth in retail services which is central to our strategy. Whilst we will continue to improve the client offering, our main development focus will continue on enhanced versions of our new EPoS product and implementing organisational improvements and process efficiencies to improve our retailer offering.

“Looking ahead to the second half, we expect to rollout PayPoint One to achieve around 4,000 sites by the end of the financial year, to develop Advanced EPoS and to step up our installations of ATMs and card payment, requiring increased costs as expected, to deliver our full year results. Trading since 30 September has been in line with our expectations.”

Shares in PayPoint are up 1.1% so far this morning to 1,051p.

Morning update

Acquisitive wholesaler Kitwave has continued its rapid expansion plans with its second deal since a refinancing earlier this year. Wakefield-based HB Clark is one of the UK’s largest independent alcohol wholesalers, with annual revenues of about £80m, supplying alcohol and soft drinks to the on trade sector in the north of England from 11 depots.

The deal follows the recent acquisition of Phoenix Fine Foods and a multimillion-pound investment in Kitwave from Pricoa Capital Group earlier this year.

For the full story see thegrocer.co.uk later this morning.

Brewer and pub group Marston’s has grown annual revenues and pre-tax profits by 7% to £905.8m and £98m respectively. The group behind the Pedigree, Wainwright, Lancaster Bomber and Hobgoblin brands said the results for the year to 1 October reflected like-for-like growth in its pubs, the positive impact of new openings, growth in the beer brands and the acquisition of Thwaites’ beer business.

CEO Ralph Findlay said: “We have delivered another year of good growth across the business, with the outstanding performance of our beer company particularly encouraging. Trading has been solid in the first few weeks of the new financial year and we have seen no discernible change to the trends experienced in 2016. The majority of our major product cost lines are contracted for 2017 and well into 2018.

“We have a high quality pub and beer business which is displaying positive momentum and is consistently outperforming the market. We believe that, despite some continuing market headwinds, our expansion plans for new pub-restaurants, lodges and Revere bars will further enhance our ability to deliver attractive returns.”

Yesterday in the City

The FTSE 100 finished the day flat at 6,817.71 points and the FTSE 250 fell back 0.3% to 17,622.52 points as Chancellor Philip Hammond delivered his first – and last – Autumn Statement spelling out lower growth and higher borrowing in the wake of Brexit. Estate agency stocks were among the losers yesterday as Hammond announced an end to one-off tenant fees.

Grocery stocks in the red included Tesco (TSCO), Sainsbury’s (SBRY), B&M European Retail (BME), Britvic (BVIC) and Greencore (GNC) – falling 2.2% to 214p, 0.9% to 235.2p, 1.6% to 251.2p, 1.4% to 561.5p and 1.4% to 286.5p respectively.

Finsbury Food Group (FIF) slumped 5.4% to 117.8p as the bakery warned in a trading update that input costs had jumped significantly as a result of the fall in sterling post-Brexit.

Caterer Compass Group (CPG) rose 2% to 1,352.35p to make back losses from Tuesday.

Topics