PayPoint was started in 1996 as a branded retail network for the payment of household bills. It was intended as an alternative to the Post Office – and it’s grabbed market share ever since then, adding mobile top-ups and private ATMs to its repertory.
Flotation in 2004 saw the company expanding fast – it was a top tip for growth investors. By 2006 it was growing at 30% a year. Now, it has businesses in the UK, Ireland, and Romania – the latter business having been acquired for £10.5m in 2007.
Is the growth still there? Results for the year to March 2009 show an 8% rise in transaction volumes, with pretax profit up 19% and an increase in the final dividend. But the interim management statement issued in August 2009 makes less impressive reading . Transactions rose only 2% in the period – and revenues declined 11% as the mobile top-ups business declined. That’s partly due to the economic downturn, and partly to the fact that mobile operators have been offering more airtime for less money. Fortunately, since mobile is the lowest margin product, net revenues (that is, after paying the cost of airtime and agents’…
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