Paypoint IMS

Provides clients with specialist consumer payment transaction processing and settlement across a wide variety of markets: (energy pre and post-payment, telecoms, housing, water, transport, e-commerce, parking and gaming) through its retail networks, internet and mobile phone channels. I have a holding in my income portfolio (epic code: PAY).

Paypoint issued their third quarter IMS today and commented that overall trading for the period to 31 December 2013 was in line with market expectations.

Total transactions processed for the quarter were 206m, up 6% compared to LY.  Gross revenues were £57m up 4% on the same period last year, with net revenues up 8% to £31m as a result of the growth in bill and general payments, retail services and PayByPhone.

Their Collect+ JV continues to grow substantially with volume up 87% to 4.2m transactions in the period.  They have increased the number of sites offering Collect+ since the half year end by 173 to 5,617 and importantly continues to trade profitability.

Strong cash generation continues to be a feature of Paypoint's trading - net cash at 31 December 2013 was £24.4m (excluding client cash of £6.4m), after payment of the interim dividend of £7.7m in the period, compared to £20.2m at 30 September 2013 (excluding client cash of £3.3m).

A positive IMS with talk of opportunities to unlock better growth in their e&m commerce (internet and PayByPhone) businesses, since a new single management structure  is providing greater focus.