(Alliance News) - Mi-Pay Group PLC on Wednesday reported a narrowed interim loss on increased payment transaction values but warned of slowing growth for the full year following the loss a large client.
The mobile payment solutions provider said revenue in the six months to June 30 rose 6.2% to GBP1.7 million from GBP1.6 million a year earlier, resulting in the company's pretax loss narrowing to GBP98,098 from GBP145,764.
"Our strong performance in transaction volume growth and improved fraud management performance drove revenues and gross profits up," the Mi-Pay explained.
Mi-Pay said its payment transaction volumes processed increased 16% to GBP58.1 million from GBP50.2 million the year before.
Transaction services revenue increased 8.3% to GBP1.3 million, with fraud services revenue rising 52% to GBP203,833. Mi-Pay's professional services revenue, however, slipped 2.3% to GBP176,267.
Chair Michael Dickerson said: "In the six-month period, we delivered further growth as consumers transferred to our on-line digital payment services, building on our previous periods of growth to Ebitda profitability.
"We are pleased to have further supported this by extending two of our major contracts and expect these clients to increase their volumes over the longer term. Our growth has enabled us to maintain our Ebitda break-even position."
During the period, Mi-Pay secured a two-year contract extension with its largest client - who contributed 31% of annual revenue in 2018 - and a five-year extension with its third largest client - who generated 12% of annual revenue in 2018.
"We have continued to invest in delivering new market compliance regulations and are well placed to take advantage of the ongoing uncertainty this is bringing. Short-term growth is impacted by this uncertainty and the previously announced client consolidation," Dickerson continued.
In September, Mi-Pay's second largest client - 13% of revenue in 2020 - consolidated its payment transactions to another existing provider as it restructured and downsize its own operation.
Dickerson added: "When combined with the slowing of new business growth due to the market challenges with new legislation, this will affect our full year performance growth expectations."
In 2018, Mi-Pay recorded a pretax loss of GBP221,214 on revenue of GBP3.3 million. The firm saw 7.4 million payment transactions, with a payment value of GBP106.0 million.
Dickerson continued: "Over the longer term, we expect to continue to build on our long term, naturally growing transaction flows and proven ability to deliver our secure payment services into the expanding and increasingly complex e-commerce market, underpinned with our ongoing investment in our solutions and our free cash position."
Shares in Mi-Pay were untraded in London on Wednesday but last closed at 6.80 pence each.
By Paul McGowan; paulmcgowan@alliancenews.com
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