(Alliance News) - PayPoint PLC on Thursday said revenue declined in its third financial quarter following cessation of its contract with Centrica PLC's British Gas.
The Hertfordshire, England-based payment services provider said underlying net revenue from continuing operations dropped 11% in the three months ended December 31 to GBP24.5 million from GBP27.5 million.
This included cessation of its British Gas contract, which brought in GBP1.7 million the prior year,
Net UK retail services revenue dropped 1.4% year-on-year to GBP10.6 million in the third quarter, reflecting higher PayPoint One card payment transactions and service fees as well as a GBP400,000 hit from compensation paid to retail partners over a November card services outage as well as lower ATM volumes.
Payment volumes were up 46% form the prior year at 49.7 million. UK parcels transactions were up 6.6%, and its UK retail network increased to 27,758 sites on December 31 from 26,829 March 31.
UK bill payments net revenue, however, dropped 34% to GBP9.5 million. Excluding British Gas, net revenue was 24% lower and transactions were down 24% as well, mostly a result of "consumers making fewer, larger payments during the Covid-19 period".
Chief Executive Nick Wiles said: "The business continues to show strong resilience and adaptability, delivering a robust performance, in line with expectations, despite increased restrictions in response to Covid-19. We have refocused our field team to work with our retailer partners to help them maximise the value of the PayPoint technology in their stores, enabling them to continue to provide essential services to their local community as well as helping them run their businesses more efficiently and understand sales trends from increased footfall as customers continue to shop local.
"Strategically, we continue to accelerate our delivery as we identify new opportunities for growth in our core UK market, both through internal investment and the integration planning of i-movo and Handepay/Merchant Rentals. I am confident the steps we have taken during this year have strengthened the business and its prospects for the future. As we enter the final quarter, our underlying trading performance is at the higher end of our expectations for the year as a whole."
Shares in PayPoint were up 3.0% at 665.17 pence in London on Thursday morning.
By Anna Farley; annafarley@alliancenews.com
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