TIDMPAY
PayPoint Plc
Results for the half year ended 30 September 2023
Strong revenue growth across the Group and significant progress
with ongoing business transformation
FINANCIAL HIGHLIGHTS
-- Group net revenue1 of GBP79.8 million (H1 FY23: GBP59.5 million)
increased by GBP20.3 million (34.1%)
-- Net revenue from PayPoint segment of GBP62.3 million (H1 FY23: GBP59.5
million) increased by GBP2.8 million (4.7%)
-- Underlying EBITDA2 of GBP31.1 million (H1 FY23: GBP28.3 million)
increased by GBP2.8 million (9.9%)
-- Underlying profit before tax (profit before tax excluding adjusting
items)3 of GBP21.8 million (H1 FY23: GBP23.6 million) decreased by GBP1.8
million (7.5%) reflecting our continued investment in the business for
growth, increased financing costs, the expected H1 loss from the
Love2shop business, and depreciation and amortisation from the core
PayPoint business
-- Underlying cash generation excluding exceptional items4 of GBP15.6
million (H1 FY23: GBP28.3 million), reflecting a seasonal increase in
working capital of GBP12.6 million following the Love2shop acquisition
-- Net corporate debt5 of GBP83.2 million (H1 FY23: GBP39.4 million)
increased by GBP43.8 million. This is due to increased financing costs
related to the acquisition of Love2shop and seasonal working capital
movements, and is expected to reduce below the starting position of
GBP72.4m by the end of the current financial year
-- Increased ordinary interim dividend of 19.0 pence per share declared,
consistent with our progressive dividend policy, and representing an
increase of 2.2% vs the final dividend declared on 28 July 2023 of 18.6
pence per share
Half year ended 30 September 2023 H1 FY24 H1 FY23 Change
--------------------------------------
Revenue GBP126.5m GBP75.4m 67.8%
Net revenue(1) GBP79.8m GBP59.5m 34.1%
Underlying EBITDA(2) GBP31.1m GBP28.3m 9.9%
Underlying profit before tax (profit
before tax excluding adjusting
items)(3) GBP21.8m GBP23.6m (7.5)%
Adjusting items(6) GBP(4.6)m GBP(2.6)m n/m
Profit before tax GBP17.2m GBP21.0m (17.9)%
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Diluted earnings per share excluding
adjusting items 22.1p 27.8p (20.2)%
Diluted earnings per share 17.4p 24.4p (28.7)%
Ordinary paid dividend per share 18.6p 18.0p 3.3%
Cash generation excluding exceptional
items(4) GBP15.6m GBP28.3m (44.5)%
Net corporate debt(5) GBP(83.2)m GBP(39.4)m 111.1%
--------------------------------------
Nick Wiles, Chief Executive of PayPoint Plc, said:
"This has been a positive half year for the PayPoint Group with
a period of significant activity supporting a number of key
initiatives across the business: the acceleration of our sales
efforts delivering growth in each of our product estates; a strong
new business pipeline for our integrated payments platform; and
driving new opportunities which leverage our enhanced capabilities,
including the first initiatives live following the acquisition of
Love2shop. It is testimony to the transformation of the business
that we continue to deliver overall Group net revenue growth in a
period where energy sector net revenue has decreased by almost 20%
and against the background of uncertain consumer behaviour and
weakening confidence due to the Cost of Living challenges.
Our partnership philosophy across the Group, combined with an
intensity and focus on execution, is continuing to unlock new
markets and revenue opportunities for us, including successfully
launching our Park Super Agent network with The Fed to over 1,500
retailer partners; Love2shop physical gift cards now live in over
2,600 major multiple retailers; an expanded partnership with Yodel
and Vinted leveraging our Collect+ Store to Store service; our
success in Open Banking working with Ovo and the Department for
Energy Security and Net Zero; our first significant win in the
charity sector with East Anglian Air Ambulance; and the continued
momentum in our PayPoint Engage proposition, helping major brands
to connect with consumers in the convenience sector.
Following the acquisition of Love2shop, the seasonal balance to
profit and cash generation in our business has now changed,
resulting in a more H2 weighted performance and contribution to the
financial year as a whole. Encouragingly, our trading momentum in
the business has remained strong into the second half of the year.
We continue to identify new opportunities to innovate and leverage
our platform and the unique strengths of our extensive client base,
accelerate the onboarding of new client business, while delivering
a strong performance in our important seasonal businesses in
parcels, Park Christmas Savings, Love2shop and energy. Our
continued focus on execution underpins our confidence in delivering
a strong second half, further progress for the year and the Group
trading in line with expectations."
OPERATIONAL HIGHLIGHTS
The Group has delivered significant progress in the half year in
a number of key business areas:
-- Parcels -- new multi-year partnership agreed with Yodel and Vinted,
delivering significant volume through our new Store to Store service,
with continued expansion of network and investment in consumer experience
through technology, in-store label printers and retailer partner support
-- Card processing -- estate growth delivered in both our EVO and Lloyds
Cardnet merchant books, driven by positive sales momentum, strengthened
governance on pricing and retention, leveraging analytics and AI tools,
an enhanced proposition and merchant engagement
-- Open Banking -- the Group is now one of the leading Open Banking
transaction processors in the UK, with further wins for our Confirmation
of Payee service with Lexis Nexis, Cardstream, Think Money and the
Department for Energy Security and Net Zero, and the expansion of our
PayPoint OpenPay service supporting a growing number of clients,
including Ovo and the Department for Energy and Net Zero
-- Park Christmas Savings -- a return to growth in billings delivered in
core business with key additional sales channel now launched in over
1,500 PayPoint Park Super Agents, recruiting savers for the 2024
Christmas Savings season to accelerate billings for FY25
-- Love2shop -- physical gift cards available for first time in over 2,600
locations ahead of Christmas 2023 gifting season, partnering with key
multiple retailers, including One Stop, MFG, Henderson's Retail and CJ
Lang. Love2shop Essentials added to key government procurement frameworks
and integrated into our PayPoint OpenPay service as an important
additional channel to support vulnerable customers
-- Integrated payments platform -- key client wins in target sectors of
housing and charities, with POBL Housing, Network Homes and East Anglian
Air Ambulance, and a strong new business pipeline building in these key
growth sectors with detailed plans to accelerate the onboarding of these
clients in H2
-- FMCG -- positive growth in our consumer engagement proposition, PayPoint
Engage, delivering brand campaigns with Coca-Cola, Amazon, AG Barr and
JTI, driving additional footfall and sales for our retailer partners
-- Business Finance -- continued growth with over GBP9m lent to our SME and
retailer partners, partnering with YouLend, support businesses during the
current economic challenges
DIVISIONAL HIGHLIGHTS
Positive performance with increased Group net revenue
Shopping
Shopping divisional net revenue increased by 4.2% to GBP32.1
million (H1 FY23: GBP30.8 million), driven by the growth of our
PayPoint One estate, service fee revenue and further enhancements
to our retailer and SME propositions.
-- Service fee net revenue increased by 8.8% to GBP9.7million, reflecting
growth in the number of revenue-generating PayPoint One sites to 18,786
(31 March 2023: 18,453 sites) and the impact of the annual RPI increase
which was capped to support our retailer partners through the current
economic challenges
-- Card payment net revenue increased by 3.5% to GBP16.4 million, with our
positive sales momentum and increased focus on customer retention
delivering site growth, driven by AI and data analytics
-- Card payment sites in the Handepay EVO estate grew to 19,371 (31 March
2023: 18,397) and in the PayPoint Lloyds Cardnet estate to 9,772 (31
March 2023: 9,541), driven by the strength of our proposition, positive
sales momentum and optimisation of our retention programme
-- UK retail network increased to 28,646 sites (31 March 2023: 28,478), with
70.0% in independent retailer partners and 30.0% in multiple retail
groups
E-commerce
E-commerce divisional net revenue increased strongly by 71.8% to
GBP5.1 million (H1 FY23: GBP3.0 million) and transactions grew by
83.1% to 42.1 million (H1 FY23: 23.0 million) through our
e-commerce technology platform, Collect+. This is further evidence
of the growing importance of our out-of-home PUDO (Pick Up and Drop
Off) network, reflecting changes in consumer habits and
accelerating channel shift away from delivery to home.
-- Excellent transaction volumes, achieving a milestone of a 2 million
parcels week in August, driven by continued growth in Vinted, the launch
of Consumer Send for FedEx and an increase in Amazon sites to over 7,600
in time for Prime Day 2023
-- Store to store service launched for Yodel/Vinted, with strong consumer
take up of the service
-- New partnership launched with OOHPod in Northern Ireland, enabling Yodel
Click & Collect customers to have their parcels delivered to secure
lockers when checking out online and returns launched at the end of the
half
-- Zebra printer expansion plans underway to rollout a further 2,000 devices
ahead of Christmas Peak 2023
-- Number of initiatives underway to grow our network in support of our
carrier partners and growing in-store volumes
Payments & Banking
Payments & Banking divisional net revenue decreased by 2.3%
to GBP25.1 million (H1 FY23: GBP25.7 million), with further growth
in digital transactions offset by a reduction in cash bill payment
volumes in the energy sector.
-- Continued digital payments growth with net revenue increasing by 9.1% to
GBP6.4 million (H1 FY23: GBP5.9 million), driven by our MultiPay
integrated payments platform
-- Cash through to digital net revenue decreased slightly by 1.2% to GBP3.3
million (H1 FY23: GBP3.4 million) and transactions decreased by 5.2% to
4.1 million (H1 FY23: 4.3 million), with volumes now returning to
pre-Covid-19 levels and a new baseline set for the category. In addition
to our existing range of digital brands, we are launching new
partnerships with a number of neo-banks, including JPMorgan Chase and
Revolut, enabling withdrawals and deposits across our extensive network
of retailer partners
-- Cash payments net revenue decreased by 9.3% to GBP15.4 million (H1 FY23:
GBP16.4 million) and transactions decreasing by 17.3% to 68.6 million (H1
FY23: 83.0 million)
-- Legacy energy sector net revenue decreased by 19.4%, driven by a shift in
consumer topping up behaviour due to the Cost of Living challenges and
unseasonably warm weather over the period
Love2shop
Love2shop divisional net revenue was GBP17.5 million in the
period (H1 FY23: N/A), with Park Christmas Savings returning to
growth for the first time in six years and a refocused and
strengthened team in Love2shop Business building momentum.
-- Park Christmas Savings delivered GBP29.9 million of billings year to date,
a return to growth after 6 years of decline
-- Rollout of over 1,500 Park Super Agents across the PayPoint retailer
partner network, helping more families budget for the newly launched
Christmas 2024 season
-- Love2shop Business -- additional corporate APIs delivered to unlock
further sales growth, a restructured business development team
established to open up further opportunities and existing client account
performance ahead of plan
-- Brand refresh for Love2shop delivered to drive further awareness and
advocacy in key consumer and corporate sectors.
RECONCILIATION OF REPORTED NUMBERS
GBPm H1 FY24 H1 FY23
Reported profit before tax from continuing
operations 17.2 21.0
---------------------------------------------------- ------- -------
Exceptional items 0.6 1.5
---------------------------------------------------- ------- -------
Profit before tax from continuing operations
excluding exceptional items 17.8 22.5
---------------------------------------------------- ------- -------
Amortisation of intangible assets arising
on acquisition -- PayPoint (previous acquisitions) 1.0 1.1
Amortisation of intangible assets arising
on acquisition -- Love2shop 3.0 -
Underlying profit before tax (profit before
tax excluding adjusting items) 21.8 23.6
---------------------------------------------------- ------- -------
Underlying EBITDA 31.1 28.3
---------------------------------------------------- ------- -------
BUSINESS DIVISION NET REVENUE AND MIX
Net revenue by business
division (GBPm) H1 FY24 H1 FY23 H1 FY22
Shopping 32.1 30.8 29.8
E-commerce 5.1 3.0 2.1
Payments & Banking 25.1 25.7 24.2
PayPoint Segment Total 62.3 59.5 56.1
Love2shop Segment Total 17.5 - -
PayPoint Group Total 79.8 59.5 56.1
Business division mix H1 FY24 H1 FY23 H1 FY22
------------------------ ------- ------- -------
Shopping 40.2% 51.8% 53.2%
E-commerce 6.4% 5.0% 3.7%
Payments & Banking 31.5% 43.2% 43.1%
Love2shop 21.9% - -
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Enquiries
PayPoint plc FGS Global
Nick Wiles, Chief Executive (Mobile: 07442 Rollo Head (Telephone: 0207 251
968960) 3801)
Rob Harding, Chief Financial Officer (Mobile: James Thompson (Email:
07525 707970) PayPoint-LON@fgsglobal.com)
A presentation for analysts is being held at 9.30am today (23
November 2023) via webcast. This announcement, along with details
for the webcast, is available on the PayPoint plc website:
https://www.globenewswire.com/Tracker?data=XThuvxq3Rg9hsIY8l6Y6A4ZCZf_KGDYVUEmmpFT32yLL15yD-iG8UkWaZDH9dRh2y7Tvv2u2JyDsonRQw_WGeXY-2YZsJ0-PbmDHXIy1bgg=
corporate.paypoint.com
CHIEF EXECUTIVE'S REVIEW
Positive half year leveraging enhanced platform for growth
This has been another positive half year for the PayPoint Group
with continued net revenue growth across the business, excellent
progress in parcels and digital payments, and good momentum in our
key growth areas of card processing, Open Banking and integrated
payments. Our integration of the Love2shop and Park Christmas
Savings businesses is largely complete and we have now launched the
first new business opportunities arising from the acquisition of
these businesses. Following the acquisition of Love2shop, the
seasonal balance to profit and cash generation in our business has
also now changed, resulting in a more H2 weighted performance and
contribution to the financial year as a whole, which is reflected
in the results we are reporting today.
First Appreciate Group initiatives live and continued Open
Banking progress
The materially enhanced platform we have built over the past
three years is opening up a wealth of opportunities, leveraging our
extensive capabilities with new and existing clients in multiple
sectors, and enabling the enhancement of our services proposition
for our SME and retailer partners.
Our new partnership, announced earlier in the year, with The
Federation of Independent Retailers (The Fed) to create a network
of Park Christmas Savings Super Agents has gained positive early
momentum and is one of the first major initiatives delivered since
the acquisition of Love2shop in FY23. Working in partnership, we
have established a network of over 1,500 Super Agents ready for the
Christmas 2024 savings season, with retailers recruiting savers in
their area and creating an additional opportunity to earn over
GBP1,000 per annum from the service. Park Christmas Savings plays
an important role in helping families budget for Christmas and
boosting their spending power through regular offers and discounts,
especially as families manage their money through the current cost
of living challenges. This additional savings channel is expected
to accelerate growth in billings for the Park Christmas Savings
business in FY25.
In addition, we were delighted to have delivered an important
first for Love2shop through rolling out physical gift cards to over
2,600 multiple retailer stores ahead of Christmas 2023, including
One Stop, Motor Fuels Group, Spar Scotland and Northern Ireland,
and several regional Co-Ops. This is a key part of our expansion
plans for Love2shop, and will be followed next year by a further
rollout into our independent retailer partners. We have now added
Love2shop Essentials to key government procurement frameworks
(Crown Commercial Service and Fund Administration and Disbursement
Services) and it has also been integrated with the PayPoint OpenPay
service, providing an important additional channel to support
vulnerable customers.
Our Open Banking partnership with OBConnect has enhanced our
integrated payments platform and already yielded positive results,
with PayPoint now one of the top 10 Open Banking transaction
processors in the UK. Our Confirmation of Payee service continues
to grow, with several client wins including Lexis Nexis,
Cardstream, Think Money and the Department for Energy Security and
Net Zero. Additionally, the PayPoint OpenPay service continues to
gain traction and new clients, notably Ovo to support Alternative
Fuel Payments, Sheffield City Council to distribute Household
Support Fund monies and the Department of Energy Security and Net
Zero for dispersing Cost of Living support to continuous cruisers,
with 97% of recipients opting to deposit into a bank account
through the PayPoint OpenPay service. We see Open Banking as a key
growth area where we can partner with organisations in the public
and private sector to enhance their payment offering, reduce costs
and improve customer support to those in need.
Accelerated momentum across all business divisions
Shopping
In Shopping, our retailer partner and SME service propositions
have been enhanced further, with a strong take up and positive
feedback from our partners. The overall PayPoint network and
PayPoint One estate have grown again this half year and our broader
commitment to our retailer partners to deliver further value and
opportunities to earn has delivered an increase to a positive NPS
score for the first time in six years. New commission-generating
services and transaction volumes have driven this positive impact
to retailer partner revenues, including good growth in our FMCG
consumer engagement proposition, PayPoint Engage, delivering brand
campaigns with Coca-Cola, Amazon, AG Barr and JTI; our partnership
with Eurochange, offering foreign currency click and collect, which
is now in pilot; and the early rollout of our new technology
solution, PayPoint Connect, which integrates with leading, third
party EPoS suppliers including PointFour and the Retail Data
Partnership.
In our card processing business, we have continued the momentum
established at the end of the last financial year, with a strong
sales performance across Handepay and PayPoint delivering further
growth in the EVO merchant book, ending the half year at 19,371
sites, and in the Lloyds Cardnet book, growing to 9,772 sites. This
positive progress has been driven by the increased optimisation of
our sales efforts, including a new team established in London for
Handepay to capture the regional market opportunity; a
strengthening of key areas of business governance to optimise
pricing and retention; a new senior hire recruited to lead our
sales and retention efforts, supported by better data, AI tools and
analytics; and the leverage of our enhanced proposition, including
launching additional functionality like EPoS and loyalty for SMEs.
In addition, we are enhancing our pricing and governance framework
for our card processing across both Handepay and PayPoint to ensure
we optimise the value delivered from our growing estate. Our
Business Finance product continues to grow, delivered in
partnership with YouLend across both PayPoint and Handepay, with
over GBP9m of funding approved to support our retailer and SME
partners during the current economic challenges.
We have continued our extensive efforts to strengthen our
retailer partner relationships, including a refreshed approach to
the 'early life' support provided to our retailer partners to drive
adoption of new services, allied with our core commitments to
regular face to face store visits, more direct communications and
our strengthened relationships with the key trade associations,
including the Association of Convenience Stores (ACS), the Scottish
Grocers' Federation (SGF) and the Federation of Independent
Retailers (the Fed). As more critical services continue to withdraw
from communities and high streets across the UK, we are more
focused than ever on working closely with our retailer and industry
partners to evolve our service provision and ensure we can leverage
our extensive network to provide vital infrastructure and
accessibility to individuals close to where they live.
E-commerce
In E-commerce, our half year-on-year performance has been
excellent, driven by the continued growth in the second-hand
clothing market via Vinted; our new Store to Store service which is
being quickly adopted by customers; and an expansion of our Amazon
network to over 7,600 stores. A further rollout of Zebra printer
technology is underway to an additional 2,000 sites, underlining
our continuing commitment to invest in improving the consumer
experience in store. Operationally, we are in our strongest
position ever heading into the peak trading period, with the
business division on track to deliver a record year of transaction
growth.
Looking ahead, we are continuing to focus on our plans to
strengthen our carrier and retailer partnerships, as well as
expanding the Collect+ network into new locations and demographics,
including transport locations, 'Home Hubs' via the Park Christmas
Savings agent network, and our growing student presence working
with the top universities and student unions to bring a range of
tailored Group services to the student population.
Payments & Banking
In Payments and Banking, we continue to diversify our digital
payments client base and strengthen our integrated payments
platform as we expand the range of digital solutions that we can
deliver to support our clients across multiple sectors, including
government, local authorities and housing associations. We continue
to make good progress in the housing sector, with POBL Housing and
Network Homes adopting our MultiPay integrated payments platform to
serve their customers, and we have recently secured our first
significant win in the charity sector with East Anglian Air
Ambulance. We are building a strong new business pipeline in these
key growth sectors and have detailed plans to accelerate the
onboarding of these clients in H2.
Our Open Banking solutions, delivered in partnership with
OBConnect, continue to go from strength to strength: Ovo is our
first client live for PISP, 2 clients have signed for AIS services
(Ovo and Citizens Advice) and 13 clients signed for Confirmation of
Payee. In addition, we successfully tendered for the new government
framework (DPS) through the Crown Commercial Service. The PayPoint
OpenPay service has also been enhanced, now giving customers the
option to deposit funds directly into a bank account, exchange for
a Love2shop Essentials card or redeem in cash via our extensive
retailer partner network. Several clients have already successfully
deployed this service, including Sheffield City Council, replacing
cheques for the distribution of the Household Support Fund, and the
Department for Energy Security and Net Zero, helping to disperse
Cost of Living support for continuous cruisers with 97% of
recipients opting to deposit into a bank account via Open Banking.
These innovative solutions give us a highly differentiated
proposition that is opening up new sectors and growth.
Love2shop
In Love2shop, we have quickly integrated the business following
the completion of the acquisition at the end of FY23 and are making
positive progress in enhancing the core business performance. It's
particularly pleasing that Park Christmas Savings has returned to
growth for the first time in six years, delivering GBP29.9m of
billings in H1 FY24 (H1 FY23: GBP24.9m), and we have taken
important steps to strengthen our corporate offering in Love2shop
Business, with investment in additional APIs delivered to unlock
further sales growth and a restructured business development team
established to better manage our existing relationships and drive
new business.
The enhanced capabilities that Love2shop has added to our
platform is already yielding positive results, including: the
rollout of 1,500 Park Super Agents across the PayPoint retailer
partner network, helping more families budget for the newly
launched Christmas 2024 season; the launch of physical Love2shop
gift cards in over 2,600 multiple retailers ahead of Christmas 2023
peak trading; and the addition of Love2shop Essentials cards to our
PayPoint OpenPay service as well as key government frameworks.
Furthermore, there are several new sector opportunities that are in
development, combining capabilities across the Group, including a
new partnership with Card Factory to combine Love2shop gift cards
with their greetings card offer through PayPoint's extensive
network.
Further progress on our ESG commitments
Our Environment, Social and Governance (ESG) strategy and action
plan has progressed well in the half year, as we consider our
social responsibility and impact as a business and reflect on the
important role that the Group plays in delivering vital services in
communities across the UK. New hybrid cars were introduced to our
fleet in April 2023, replacing diesel company cars and petrol hire
cars and an electric car leasing scheme has now launched. We
continue to be mindful of the impact of the Cost of Living on our
people, with salaries reviewed again in July, ensuring that all of
our colleagues are paid in excess of the Real Living Wage. In
addition, we launched 'My Pay, My Way' with Wagestream to offer
further financial wellbeing support to our people. As part of our
'Welcoming Everyone' programme, we held a series of events to mark
Pride Month in June, and Love2shop was recognised as one of the
Best Workplaces for Women by Great Place to Work UK in June. The
Group recently participated in the Great Place to Work survey for
the first time, and we were delighted to achieve Great Place to
Work certification which recognises the work we have done to create
a dynamic environment for our people where we deliver for our
customers by collaborating and being good colleagues to each other,
creating a positive and inclusive environment where everyone can
learn, grow and shine.
Update on claims against PayPoint
Further to the update provided on 28 July 2023, PayPoint can
confirm that a first Case Management Conference (CMC) was held on
31 October 2023 at the Competition Appeal Tribunal relating to the
claims served by Utilita Energy Limited and Utilita Services
Limited ("Utilita") and Global 365 plc and Global Prepaid Solution
Limited ("Global 365"). The focus of the CMC was to agree
disclosure and a timetable for proceedings.
The Group's position remains unchanged: it is confident that it
will successfully defend the claim by Utilita, which does not
provide any clear evidence to support the cause of action or the
amount claimed, and also that it will successfully defend the claim
by Global 365, which fundamentally misunderstands the energy market
and the relationships between the relevant Group companies and the
major energy providers, whilst also over-estimating the opportunity
available, if any, for the products offered by Global 365. As a
result, no accounting provision has been made for these claims.
Given this position, the Group's preference is for a swift and
expedient process, targeting a trial listing on the first available
date to be agreed with all parties.
The Group will continue to update the market on a quarterly
basis as part of its financial reporting cycle.
Outlook and dividend
We have delivered strong results in a growing number of key
areas in the first half. Our enhanced platform and expanded
capabilities across the Group, combined with our business-wide
partnership philosophy and intensity of execution, give the Board
confidence in delivering a strong second half, further progress for
the year and the Group trading in line with expectations.
The opportunity to deliver enterprise level solutions, combining
the extensive capabilities across the Group, is significant and is
enabling us to deepen our relationships with existing clients as
well as expanding into new verticals.
We have detailed execution plans in place to capitalise on the
positive momentum built up in our key growth areas of card
processing, Open Banking, parcels, integrated payments and the new
Love2shop division, delivering profitable growth in our retail and
card estates, further enhancements to our SME and retailer partner
proposition and positive new business growth in key target sectors.
Following the acquisition of Love2shop, the seasonal balance to
profit and cash generation in our business has also now changed,
resulting in a more H2 weighted performance and contribution to the
financial year as a whole.
The trading momentum in the business has remained strong into
the second half of the year, as we continue to identify new
opportunities to innovate and leverage our platform and the unique
strengths of our extensive client base, accelerate the onboarding
of new client business, all while delivering a strong performance
in our important seasonal businesses in parcels, Park Christmas
Savings, Love2shop and energy. The latter business is already
delivering a more resilient performance early in H2, in spite of
the shifts in consumer topping up behaviour due to the Cost of
Living challenges and unseasonably warm weather seen over H1.
Cash usage remains resilient in the UK, particularly for the
millions of consumers who rely on it on a daily basis, and we
remain committed to providing vital services that maintain access
to cash, as well as developing new services to support communities
across the UK. We also remain alert to the potential impact on
consumers from the broader economic challenges, including the
changes we have seen to behaviours in the energy sector and the
weakening consumer confidence reported across the UK, all of which
we monitor closely across the business. It is testimony to the
transformation of the business that we have delivered overall Group
net revenue growth in a period where energy sector net revenue has
decreased by almost 20%.
The Board has proposed an interim dividend of 19.0 pence per
share, an increase of 2.2% vs the final dividend declared on 28
July 2023 of 18.6 pence per share, consistent with our progressive
dividend policy of a target cover range of 1.5 to 2.0 times
earnings excluding exceptional items, reflecting our long-term
confidence in the business, the strength of our underlying cash
flow, and the enhanced growth prospects across the Group.
Our compelling characteristics of strong cash flow and resilient
earnings remain constant, and our materially enhanced platform is
positioned to deliver sustainable and profitable growth for our
shareholders, and further progress in the delivery of these
objectives in the current year.
Nick Wiles
Chief Executive
22 November 2023
PROGRESS AGAINST OUR STRATEGIC PRIORITIES
SHOPPING BUSINESS DIVISION -- H1 FY24 net revenue GBP32.1m (H1
FY23: GBP30.8m)
PRIORITY 1: EMBED PAYPOINT GROUP AT THE HEART OF SME AND
CONVENIENCE RETAIL BUSINESSES
H1 FY24 Progress
-- Further enhancements delivered to our SME and retailer proposition,
including good growth in our FMCG consumer engagement proposition,
PayPoint Engage, delivering brand campaigns with Coca-Cola, Amazon, AG
Barr and JTI; our partnership with Eurochange, offering foreign currency
click and collect, is now in pilot; and the early rollout of our new
technology solution, PayPoint Connect, which integrates with leading,
third party EPoS suppliers including PointFour and the Retail Data
Partnership.
-- Strong sales performance in card processing business for Handepay and
PayPoint, delivering further growth in the EVO merchant book, ending the
half year at 19,371 sites, and in the Lloyds Cardnet book, growing to
9,772 sites. This was driven by the increased optimisation of our sales
efforts, including a new team established in London to capture the
regional market opportunity; a strengthening of key areas of business
governance to optimise pricing and retention; a new senior hire recruited
to lead our sales and retention efforts, supported by better data, AI
tool and analytics; and the leverage of our enhanced proposition,
including launching additional functionality like EPoS and loyalty for
SMEs
-- Further expansion of Counter Cash, now enabled in 6,127 sites and with
2,098 sites transacting regularly, and over GBP32.1 million withdrawn in
the half year, offering vital access to cash over the counter and
complementing the existing ATM estate
-- Continued under performance of ATMs, due to broader shifts in consumer
cash usage, with net revenue decreased by 9.1% and transaction volumes by
10.5%. Management in this area has been recently strengthened, with a new
hire secured to drive tighter operational management of the estate and
reduce churn
-- Good progress on retailer engagement and service, with our Net Promoter
Score moving from negative to positive, a new in-life management
programme launched to drive retailer service adoption, and several
service improvements launched, including a new Chatbot launched to
support retailer partners achieving a 75% first time resolution rate in
its first weeks
-- Positive year on year growth of Business Finance via YouLend with over
GBP9 million lent in the half year, supporting our retailer and SME
partners during the current economic challenges
E-COMMERCE BUSINESS DIVISION -- H1 FY24 net revenue GBP5.1m (H1
FY23: GBP3.0m)
PRIORITY 2: BECOME THE DEFINITIVE TECHNOLOGY-BASED E-COMMERCE
DELIVERY PLATFORM FOR FIRST AND LAST MILE CUSTOMER JOURNEYS
H1 FY24 Progress
-- Excellent transaction volumes, achieving milestone of a 2 million parcels
week in August, driven by continued growth in Vinted, the launch of
Consumer Send for FedEx and an increase in Amazon sites to 7,698 in time
for Prime Day 2023
-- Further network expansion to 11,263 sites, including Fed retailer
partners as part of Park Christmas Savings Super Agent rollout and
additional multiple retailers onboarded, including One Stop
-- DPD partnership expanded to over 2,000 sites, with API integration into
our parcels app and additional Print In Store capability launched
-- Store to store service launched for Yodel/Vinted, with strong consumer
take up of the service
-- New partnership launched with OOHPod in Northern Ireland, enabling Yodel
Click & Collect customers to have their parcels delivered to secure
lockers in 12 sites when checking out online and returns launched at the
end of the half
-- Zebra printer expansion plans underway to rollout a further 2,000 devices
ahead of Christmas Peak 2023
PAYMENTS & BANKING BUSINESS DIVISION -- H1 FY24 net revenue
GBP25.1m (H1 FY23: GBP25.7m)
PRIORITY 3: SUSTAIN LEADERSHIP IN 'PAY-AS-YOU-GO' AND GROW
DIGITAL BILL PAYMENTS
H1 FY24 Progress
-- Continued progress in digital net revenue, with growth of +9.1% versus H1
FY23
-- Further expansion of our client relationships with our enhanced
integrated payments platform, including launching with POBL Housing and
Network Homes, rolling out our PayPoint OpenPay service to more clients
(Sheffield City Council, Ovo, Department for Energy Security and Net
Zero), expanding our Confirmation of Payee services with Lexis Nexis,
Cardstream, Think Money and the Department for Energy Security and Net
Zero and being established as sole provider of cash disbursement services
on Crown Commercial Service, displacing Post Office
-- Won award for Best Open Banking Partnership -- Consumer at the 2023 Open
Banking Awards, in conjunction with obconnect, for our work delivering
the Energy Bills Support Scheme
-- Strong pipeline of client wins secured, for mobilisation over H2 FY24,
including Guinness Housing and East Anglia Air Ambulance for our full
suite of integrated payments solutions
-- Cash through to digital -- strong growth in the banking segment,
providing cash deposits and withdrawals to a number of neobanks, with
over GBP210 million deposited in the half year. Further progress in
expanding client base and services provided in gifting (Netflix and
Google Play) and additional neo banks (Revolut and JP Morgan Chase) being
onboarded in H2 FY24, to complement existing gaming portfolio
-- Legacy energy sector net revenue decreased by 19.4%, driven by a shift in
consumer topping up behaviour due to the Cost of Living challenges and
unseasonably warm weather over the period
LOVE2SHOP BUSINESS DIVISION - H1 FY24 net revenue GBP17.5m (H1
FY23: N/A)
PRIORITY 4: REINFORCE LEADERSHIP POSITION IN GIFTING, REWARDS
AND PREPAID SOLUTIONS
-- Park Christmas Savings - a return to growth in billings for the first
time since 2018, with the best retention rate for direct customers
delivered to date of 77.9% and a growth in the agency size to an average
of 4.49 savers per agent. In addition, a new closed-loop Mastercard
(Purple Card) was launched with 140+ brands, exclusively for Park
customers
-- Love2shop Business -- positive half year with 13 new client wins
delivered, including Five Guys, existing managed client accounts ahead of
plan, and a restructured business development team now in place,
including a new Head of Business Development joining us from Edenred
-- First new initiatives launched into the PayPoint retailer partner network
following acquisition -- over 1,500 Park Super Agents now live to help
recruit savers for the Christmas 2024 season and physical Love2shop gift
cards now rolled out to over 2,600 multiple retailer sites, including One
Stop, Motor Fuels Group and several regional Co-ops
-- New redemption partners added ahead of the Christmas peak, including
significant brands, such as B&Q, WH Smith, Rymans, Matalan & Blackwell's.
Additionally, a successful refresh of the Love2shop brand was delivered,
with brand awareness now at a high of 44.8%
PRIORITY 5: BUILDING A DELIVERY FOCUSED ORGANISATION AND
CULTURE
PAYPOINT GROUP
H1 FY24 Progress
-- Good progress against our ESG programme, with new hybrid cars introduced
to our fleet in April 2023, replacing diesel company cars and petrol hire
cars, and an electric car leasing scheme now launched
-- A number of actions taken to mitigate the impact of the Cost of Living on
our people, with salaries reviewed again in July, ensuring that all our
colleagues are paid a minimum of the Real Living Wage. In addition, we
launched 'My Pay, My Way' with Wagestream to offer further financial
wellbeing support to our people
-- As part of our 'Welcoming Everyone' programme, we held a series of events
to mark Pride Month in June, and Love2shop was recognised as one of the
Best Workplaces for Women by Great Place to Work UK in June
-- The Group recently participated in the Great Place to Work survey for the
first time, and we were delighted to achieve Great Place to Work
certification which recognises the work we have done to create a dynamic
environment for our people where we deliver for our customers by
collaborating and being good colleagues to each other, creating a
positive and inclusive environment where everyone can learn, grow and
shine
-- Integration of Love2shop largely complete, with first business
initiatives launched, a new Northern Hub established in Liverpool,
investment agreed and delivered in further APIs to open up additional
revenue opportunities in the Corporate business, and first phase of
organisational changes completed
-- Continued focus on improving our IT service delivery through the
transformation into cross-functional product engineering teams with full
responsibility for service delivery and product development of each
service, a continued focus on cybersecurity, and Love2shop IT employees
now fully integrated
FINANCIAL REVIEW
2
Six months to 30 September Six months to 30 September Change
GBPm 2023 2022 %
----------------------------------------------------------
PayPoint segment 81.2 75.4 7.8%
Love2shop segment 45.3 - -
----------------------------------------------------------
Total revenue 126.5 75.4 67.8%
---------------------------------------------------------- -------------------------- -------------------------- -------
PayPoint segment 62.3 59.5 4.7%
Love2shop segment 17.5 - -
Total net revenue 79.8 59.5 34.1%
PayPoint segment (38.7) (35.9) 7.8%
Love2shop segment (19.3) - -
----------------------------------------------------------
Total costs continuing operations (58.0) (35.9) 61.4%
---------------------------------------------------------- -------------------------- -------------------------- -------
PayPoint segment 23.6 23.6 -
Love2shop segment (1.8) - -
Underlying profit before tax 21.8 23.6 (7.5)%
Adjusting items:
Amortisation of intangible assets arising on acquisition (4.0) (1.1) 277.4%
Exceptional items (0.6) (1.5) 64.1%
----------------------------------------------------------
Profit before tax 17.2 21.0 (17.9)%
Underlying EBITDA(7) 31.1 28.3 9.9%
Cash generation from continuing operations excluding
exceptional items 15.6 28.3 (44.5)%
Net corporate debt(8) (83.2) (39.4) 111.1%
Total revenue increased by GBP51.1 million (67.8%) to GBP126.5
million (September 2022: GBP75.4 million). Net revenue increased by
GBP20.3 million (34.1%) to GBP79.8 million (September 2022: GBP59.5
million) with this being the first period including the L2S segment
contributing GBP17.5 million.
Total costs increased by GBP22.1 million to GBP58.0 million
(September 2022: GBP35.9 million). The increase in costs was driven
by the GBP19.3 million additional cost base from L2S segment
together with increases in borrowing costs following the
acquisition of Appreciate Group and investments in our field sales
teams. Exceptional costs of GBP0.6 million, which are one-off,
non-recurring and do not reflect current operational performance
relate to legal fees incurred as as result of the Group's defence
of claims served against it. The prior year exceptional costs of
GBP1.5 million include a write down in relation to the disposal of
Snappy Ltd in October 2022 and fee associated with the acquisition
of Appreciate Group.
The underlying profit before tax decreased by GBP1.8 million
(7.5%) to GBP21.8 million (September 2022: GBP23.6 million). This
result includes GBP1.8 million loss on the Love2shop segment which
includes an interest cost allocation. This is due to the seasonal
nature of the business where profit is primarily generated in the
second half of the financial year. In comparison, the previous year
before PayPoint acquired Love2Shop, Appreciate Group PLC made a
loss before tax of GBP1.2 million in the six month period to
September 2022. The historic PayPoint segment underlying profit
before tax was in line with the prior year.
Profit before tax of GBP17.2 million (September 2022: GBP21.0
million) decreased by GBP3.8 million (17.9%). The decrease reflects
current year adjusting items totalling of GBP4.6 million which
includes six months amortisation of intangible assets arising on
the Appreciate acquisition following the acquisition in February
2023.
3
Six months to 30 September Six months to 30 September
EBITDA / Underlying EBITDA (GBPm) 2023 2022
-----------------------------------------------------
Profit before tax 17.2 21.0
Add back:
Net interest expense 3.6 1.0
Depreciation & Amortisation - including amortisation
of intangible assets arising on acquisition 9.7 4.8
EBITDA (GBPm) 30.5 26.8
----------------------------------------------------- -------------------------- --------------------------
Exceptional items 0.6 1.5
----------------------------------------------------- -------------------------- --------------------------
Underlying EBITDA (GBPm) 31.1 28.3
----------------------------------------------------- -------------------------- --------------------------
Underlying EBITDA increased by GBP2.8 million to GBP31.1 million
(September 2022: GBP28.3 million), which is made up of GBP2.2
million for the Love2Shop segment and GBP28.9 million for the
PayPoint segment.
Cash generation reduced to GBP15.6 million (September 2022:
GBP28.3 million), delivered from underlying profit before tax of
GBP21.8 million (September 2022: GBP23.6 million). There was a net
working capital outflow of GBP12.6 million, of this GBP2.0 million
related to payment of costs accrued for the Appreciate acquisition
at the year end, GBP2.7 million relating to extending payment terms
with a key customer and the remaining amount related to seasonal
timing which is expected to unwind in the second half of the
year.
Net corporate debt increased by GBP43.8 million from September
2022 to GBP83.2 million (March 2023: GBP72.4 million) following
working capital requirements in the first six months of the year.
At 30 September 2023 loans and borrowings were GBP101.8 million
(September 2022: GBP43.2 million).
PAYPOINT SEGMENT
Six months to 30 September Six months to 30 September Change
GBPm 2023 2022 %
-----------------------------------------------------------
Total Revenue 81.2 75.4 7.8%
-----------------------------------------------------------
Shopping 32.1 30.8 4.2%
E-commerce 5.1 3.0 71.8%
Payments & Banking 25.1 25.7 (2.3)%
-----------------------------------------------------------
Net revenue 62.3 59.5 4.7%
----------------------------------------------------------- -------------------------- -------------------------- ------
Other costs of revenue 8.1 7.1 14.1%
Depreciation and amortisation (costs of revenue) 4.3 3.4 26.5%
Depreciation and amortisation (administrative expenses)
excluding amortisation of intangible assets arising
on acquisition 0.2 0.2 -
Other administrative costs -- excluding exceptional
items 24.7 24.2 2.1%
Net finance costs -- excluding exceptional costs 1.4 1.0 40.0%
-----------------------------------------------------------
Total costs 38.7 35.9 7.8%
----------------------------------------------------------- -------------------------- -------------------------- ------
Underlying profit before tax (excluding adjusting
items) 23.6 23.6 -
----------------------------------------------------------- -------------------------- -------------------------- ------
Shopping net revenue increased by GBP1.3 million (4.2%) to
GBP32.1 million (September 2022: GBP30.8 million). Service fees net
revenue increased by GBP0.8 million (8.8%) driven by additional
PayPoint One sites and implementing the annual RPI increase. Cards
net revenue increased by GBP0.5 million (3.5%) from
Handepay/Merchant Rentals performance, partially offset by PayPoint
cards. ATM and Counter Cash net revenue decreased by GBP0.3 million
(6.5%) due to a reduction in transactions driven by the continuing
trend of reduced demand for cash across the economy. FMCG revenue
increased by GBP0.3 million (416.0%) to GBP0.4 million (September
2022: GBP0.1 million) following further campaigns run in the
year.
E-commerce net revenue increased by GBP2.1 million (71.8%) to
GBP5.1 million (September 2022: GBP3.0 million), driven by strong
growth in total transactions which increased by 83.1%. This was due
to our strength in clothing/fashion categories, the investment in
the in-store experience with Zebra label printers over the past 18
months and the continued expansion from new services and carrier
partners.
Payments & Banking net revenue decreased by GBP0.6 million
(2.3%) to GBP25.1 million (September 2022: GBP25.7 million). Cash
bill payments net revenue decreased by GBP2.0 million (16.4%) as a
result of a decrease in bill payment transactions from the increase
in energy prices and the continued switch to digital payments. Cash
top-ups net revenue decreased by GBP0.1 million (1.6%) with volumes
down 5.0% driven by the continuing structural declines in the
prepaid mobile sector. Digital net revenue increased by GBP0.5
million (9.1%) driven by our Cash Out services. Cash through to
digital, eMoney, net revenue decreased by GBP0.1 million (1.2%) as
a result of a 5.2% decrease in volumes.
Total costs (excluding adjusting items) increased by GBP2.8
million (7.8%) to GBP38.7 million, primarily as a result of further
investment in our people and field sales team to support growth in
sales.
SECTOR ANALYSIS
SHOPPING
Shopping consists of services PayPoint provides to retailer
partners, which form part of PayPoint's network, and SME partners.
Services include providing the PayPoint One platform (which has a
basic till application), EPoS, card payments, terminal leasing,
ATMs, Counter Cash and FMCG vouchering.
Net revenue Six months to 30 September Six months to 30 September
(GBPm) 2023 2022 Change %
----------------
Service fees 9.7 8.9 8.8%
Card payments 16.4 15.9 3.5%
ATMs and Counter
Cash 4.5 4.8 (6.5)%
Other shopping 1.5 1.2 20.8%
----------------
Total
net
revenue
(GBPm) 32.1 30.8 4.2%
---------------- -------------------------- -------------------------- --------
Net revenue increased by GBP1.3 million (4.2%) to GBP32.1
million (September 2022: GBP30.8 million) primarily due to the
growth in service fees and Handepay/Merchant Rentals card payments.
The net revenue of each of our key products is separately addressed
below.
Service fees from Six months to 30 September Six months to 30 September
terminals 2023 2022 Change %
-------------------
Net Revenue (GBPm) 9.7 8.9 8.8%
PayPoint terminal
sites (No.)
PayPoint
One Base 6,533 7,090 (7.9)%
PayPoint
One EPoS
Core 11,509 10,223 12.6%
PayPoint
One EPoS
Pro 744 992 (25.0)%
-------------------
Total PayPoint
One -- revenue
generating 18,786 18,305 2.6%
PayPoint One Base
non-revenue
generating 667 691 (3.5)%
-------------------
Total PayPoint One 19,453 18,996 2.4%
Legacy (T2) 19 140 (86.4)%
.PPoS 9,174 9,259 (0.9)%
Total terminal
sites in PayPoint
network 28,646 28,395 0.9%
PayPoint One
average weekly
service fee per
site (GBP) 19.1 17.7 7.3%
As at 30 September 2023, PayPoint had a live terminal in 28,646
UK sites, an increase of 0.9% primarily as a result of new PayPoint
One sites which increased by 2.4% to 19,453 sites.
Service fees is a core growth area and consists of service fees
from PayPoint One and our legacy terminals. Service fee net revenue
increased by GBP0.8 million (8.8%) to GBP9.7 million driven by the
additional 481 PayPoint One revenue generating sites compared to
the prior period. The higher price point EPoS Core sites increased
by 1,286 due to new sales and upselling whilst EPOS Pro sites
decreased by due to normal churn and no longer being actively
marketed.
The PayPoint One average weekly service fee per site increased
by 7.3% to GBP19.1, benefiting from the increase in EPoS Core sites
which are charged at a higher rate and the annual RPI increase.
Six months to 30 September Six months to 30 September
Card payments and leases 2023 2022 Change %
--------------------------------------------------
Net Revenue (GBPm)
Card payments and leases -- Handepay and Merchant
Rentals 10.6 9.8 8.8%
Card payments -- PayPoint and RSM 2000 5.8 6.1 (5.1)%
--------------------------------------------------
Services in Live sites (No.)
Card payments -- Handepay 22,615 22,065 2.5%
Card terminal lessees -- Merchant Rentals 35,386 34,648 2.1%
Card payments -- PayPoint 9,772 9,514 2.7%
Card payments -- RSM 2000 129 145 (11.3)%
--------------------------------------------------
Transactions (Millions)
Card payments -- Handepay 84.7 78.0 8.5%
Card payments -- PayPoint 126.4 118.5 6.6%
Card payments -- RSM 2000 3.6 3.6 -
--------------------------------------------------
Handepay and Merchant Rentals generated GBP10.6 million net
revenue in the period. Handepay card payments transactions
increased by 8.5% to 84.7 million, maintaining strong transaction
volumes seen in the previous year but at a lower average
transaction value of GBP28.01 (September 2022: GBP29.20). There
were 22,625 Handepay card payments sites, an increase of 550 sites
(2.5%) since September 2022. Handepay EVO sales increased in the
year supported by the one-month operating lease proposition, but
sites overall have been impacted by higher churn, particularly in
our Worldpay back book in this very competitive market. The sales
momentum increased due to the sales team being fully staffed and
the launch of the new Android device.
PayPoint card payments transactions increased by 6.6% to 126.4
million while net revenue decreased by 5.6% to GBP5.2 million,
maintaining strong transaction volumes seen in the previous year
but at a lower average transaction value GBP10.40 (September 2022:
GBP10.60). Across our network there were 9,772 PayPoint card
payments sites, an increase of 258 sites (2.7%) since 30 September
2022.
ATMs and Six months to 30 September Six months to 30 September
Counter Cash 2023 2022 Change %
-------------
Net Revenue
(GBPm) 4.5 4.8 (6.6)%
Services in
Live sites
(No.) 9,639 8,060 19.6%
Transactions
(Millions) 14.7 15.5 (5.6)%
------------- -------------------------- -------------------------- --------
Net revenue reduced by GBP0.3m (6.6%) to GBP4.5 million
(September 2022: GBP4.8 million) as transactions reduced by 5.6% to
14.7 million. This is attributable to the continued reduced demand
for cash across the economy although our new product, Counter Cash,
continues to grow. ATM and Counter Cash sites increased 19.6% to
9,639 mainly as a result of the continued roll out of Counter Cash
sites and PayPoint continued to optimise its ATM network by
relocating existing machines to better performing locations.
Counter Cash contributed 10.4% of transactions (September 2022:
5.5%).
Other: Other shopping services increased by GBP0.3 million
(20.3%) to GBP1.5 million (September 2022: GBP1.2 million) this
includes the partnership with Snappy Shopper and FMCG
campaigns.
E-COMMERCE
Six months to 30 September Six months to 30 September
Parcels 2023 2022 Change %
-------------
Net Revenue
(GBPm) 5.1 3.0 71.8%
Services in
Live sites
(No.) 11,263 9,891 13.9%
Transactions
(Millions) 42.1 23.0 83.1%
------------- -------------------------- -------------------------- --------
E-commerce net revenue increased by GBP2.1 million (71.8%) to
GBP5.1 million due to the increase in total parcels transactions by
83.1% to 42.1 million. This was driven by our strength in
clothing/fashion categories and the investment in the in-store
experience with Zebra label printers over the past 18 months. There
has been continued expansion from new services, Yodel store to
store and Amazon returns, and new carrier partnerships with
Wish.com and InPost. Parcel sites increased by 13.9% to 11,263
sites.
PAYMENTS & BANKING
Six months to 30 September Six months to 30 September
2023 2022 Change %
------------
Net revenue
(GBPm)
Cash -- bill
payments 10.3 12.3 (16.4)%
Cash --
top-ups 3.6 3.7 (1.6)%
Digital 6.4 5.9 9.1%
Cash through
to digital 3.3 3.4 (1.2)%
Other
payments
and
banking 1.5 0.4 229.9%
Total net
revenue
(GBPm) 25.1 25.7 (2.3)%
------------ -------------------------- -------------------------- --------
Payments & Banking divisional net revenue decreased by 2.3%
to GBP25.1 million as a result of fewer cash bill payments and top
up transactions and margin erosion from prior year client contract
renewals partially offset by continued growth in digital
transactions, particularly within the cash-out sector.
Cash -- bill Six months to 30 September Six months to 30 September Change
payments 2023 2022 %
-------------
Net revenue
(GBPm) 10.3 12.3 (16.4)%
Transactions
(millions) 59.4 73.3 (18.9)%
Transaction
value
(GBPm) 1,828.2 1,963.8 (6.9)%
Average
transaction
value (GBP) 30.8 26.8 14.8%
Net revenue
per
transaction
(pence) 17.3 16.8 3.2%
-------------
Cash -- bill payments net revenue decreased by GBP2.0 million
(16.4%) to GBP10.3 million. Cash -- bill payments transactions
decreased by 13.9 million (18.9%) to 59.4 million as a result of
changing consumer behaviour leading to lower top ups following the
support in FY23 from the Governments Energy Bills Support Scheme
(EBSS).
Cash -- Six months to 30 September Six months to 30 September Change
top-ups 2023 2022 %
--------------
Net revenue
(GBPm) 3.6 3.7 (1.6)%
Transactions
(millions) 9.2 9.7 (5.0)%
Transaction
value (GBPm) 115.2 120.0 (4.1)%
Average
transaction
value (GBP) 12.5 12.4 1.0%
Net revenue
per
transaction
(pence) 39.1 38.1 2.6%
--------------
Cash -- top-ups net revenue decreased by GBP0.1 million (1.6%)
to GBP3.6 million. Cash top-ups transactions decreased by 0.5
million (5.0%) to 9.2 million due to further market declines in the
prepaid mobile sector whereby UK direct debit pay-monthly options
displace UK prepay mobile.
Six months to 30 September Six months to 30 September Change
Digital 2023 2022 %
--------------
Net revenue
(GBPm) 6.4 5.9 9.1%
Transactions
(millions) 23.5 23.5 -
Transaction
value (GBPm) 534.1 482.9 10.6%
Average
transaction
value (GBP) 22.7 20.5 10.9%
Net revenue
per
transaction
(pence) 27.2 25.1 8.5%
--------------
Digital (MultiPay, Cash Out and Direct Debits) net revenue
increased by GBP0.5 million (9.1%) to GBP6.4 million and digital
transactions remained in line with the prior period. MultiPay net
revenue increased by GBP0.4 million to GBP2.2 million (September
2022: GBP1.8 million) with transactions growing by 0.1 million to
16.3 million. The DWP Payment Exception Service contributed GBP2.0
million net revenue in the period (September 2022: GBP2.4 million)
following the expected decline of customers. Cashout revenue
increased by GBP0.5 million (45.6%) to GBP1.5 million (September
2022: GBP1.0 million) driven by a higher number of councils using
the service to provide cash out vouchers.
Cash through Six months to 30 September Six months to 30 September Change
to digital 2023 2022 %
--------------
Net revenue
(GBPm) 3.3 3.4 (1.2)%
Transactions
(millions) 4.1 4.3 (5.2)%
Transaction
value (GBPm) 265.0 244.1 8.6%
Average
transaction
value (GBP) 64.6 56.4 14.5%
Net revenue
per
transaction
(pence) 80.5 79.1 1.8%
--------------
Cash through to digital (eMoney) net revenue decreased by GBP0.1
million (1.2%) to GBP3.3 million (September 2022: GBP3.4 million)
and transactions decreased by 0.2 million (5.2%) to 4.1 million
(September 2022: 4.3 million) with volumes returning to
pre-Covid-19 levels and a new baseline set for the category. EMoney
transactions derive a substantially higher fee per transaction than
traditional top-up transactions as they are more complex to
process.
Other Payments & Banking net revenue includes SIM sales,
interest generated by investing cash received on client funds and
other ad-hoc items which contributed GBP1.4 million (September
2022: GBP0.4 million) net revenue.
LOVE2SHOP SEGMENT
Six months to 30 September
GBPm 2023
-----------------------------------------------------------
Billings 105.1
-----------------------------------------------------------
Revenue 45.3
-----------------------------------------------------------
Net revenue 17.5
-----------------------------------------------------------
Other costs of revenue (5.7)
Depreciation and amortisation (administrative expenses)
excluding amortisation on intangible assets arising
on acquisition (1.2)
Other administrative costs (10.2)
Net finance costs (2.2)
Total costs (19.3)
----------------------------------------------------------- --------------------------
Underlying profit before tax (excluding adjusting
items) (1.8)
----------------------------------------------------------- --------------------------
Love2shop (L2s) has generated GBP105.1 million of total billings
in the period -- a measure of total value of balance sold on cards
and vouchers. The primary focus of the business is the sale of
multi-retailer redemption products. Revenue from these products is
largely service fee received from retail partners when the products
are spent, non-redemption income when the product expires, and
interest income earned on prepaid funds. L2s also sells cards and
vouchers that can only be redeemed at a single retailer,
effectively acting as a reseller. For these products, L2s acts as
the principal, and revenue is recognised at the full value of
billings at the time of dispatch. Net revenue however is stated
after deducting the costs for the single retailer product,
reflecting the actual income generated from the sale. Net revenue
for the HY was GBP17.5 million.
The business is seasonal in nature, and profit is primarily
generated In H2 of the financial year, which represents the peak
trading period for L2s corporate business and of the dispatch of
Park Christmas savings prepaid products around Christmas.
PROFIT BEFORE TAX AND TAXATION
The income tax charge of GBP4.4 million (September 2022: GBP3.9
million) on profit before tax of GBP17.2 million (September 2022:
GBP21.0 million) represents an effective tax rate of 25.5%
(September 2022: 18.7%). This is higher than the UK statutory rate
of 25% due to adjustments in respect of share based payments.
GROUP STATEMENT OF FINANCIAL POSITION
Net assets of GBP110.8 million (September 2022: GBP88.4 million)
increased by GBP22.4 million reflecting the shares issued as part
of the acquisition of Appreciate and the growth in retained
earnings. Current assets increased by GBP226.4 million to GBP335.7
million (September 2022: GBP109.3 million) due to the monies held
in trust and voucher deposits acquired with the Appreciate
acquisition. Non-current assets of GBP224.2 million (September
2022: GBP123.1 million) increased by GBP101.1 million due to the
Appreciate acquisition goodwill and intangible assets and the
investment in terminals. Current liabilities increased by GBP260.8
million due to the liabilities matching the cash held on behalf of
clients and monies held in trust and an increase in borrowings from
the RCF drawdown, required for the acquisition. Non-current
liabilities of GBP53.9 million (September 2022: GBP9.5 million)
increased by GBP44.4 million due to the new GBP36.0 million
amortising term loan taken out to fund the acquisition and deferred
tax liabilities arising from the acquisition.
At 30 At 31 At 30
Net debt September March September
2023 2023 2022
Cash and cash equivalents - net corporate
cash 18.6 22.0 3.8
Less:
Loans and borrowings (101.8) (94.4) (43.2)
Net debt (83.2) (72.4) (39.4)
-------------------------------------------- ----------- ------ -----------
At 30 September 2023, net corporate debt was GBP83.2 million
(September 2022: GBP39.4 million) and has increased by GBP10.8
million from the year end position. This is as a result of positive
cash generation offset by working capital requirements in the first
six months along with tax, capex and dividend requirements. Total
loans and borrowings of GBP101.8 million, which have increased by
GBP7.4 million from 31 March 2023, consisted of a GBP41.4 million
amortising term loans, GBP59.5 million drawdown of the GBP75.0
million revolving credit facility and GBP0.9 million of asset
financing balances and accrued interest (September 2022: GBP26.0
million drawdown from the revolving credit facility, GBP16.3
million amortising term loan and GBP0.9 million of asset financing
balances).
GROUP CASH FLOW AND LIQUIDITY
The following table summarises the cash flow movements during
the period.
Six months Six months
to 30 September to 30 September
2023 2022 Change %
Profit before tax 17.2 21.0 (18.2)%
Exceptional items 0.6 1.5 (60.0)%
Depreciation and amortisation 9.7 4.7 106.4%
Share-based payments and other
items 0.7 0.3 133.3%
Working capital changes
(corporate) (12.6) 0.8 n/m
Cash generation 15.6 28.3 (44.9)%
Taxation payments (5.1) (1.3) 292.3%
Capital expenditure (7.1) (6.0) 18.3%
Contingent consideration cash paid - (1.0) -
Purchase of convertible loan note and
other investment - (3.0) -
Lease payments (0.7) (0.1) 600.0%
Dividends paid (13.5) (12.4) 8.9%
Net (increase)/decrease in net debt (10.8) 4.5 -
Net corporate debt at the beginning of
the period (72.4) (43.9)
Net (increase)/decrease in net debt (10.8) 4.5
Net corporate debt at the end of the
period (83.2) (39.4) 111.2%
---------------------------------------- ---------------- ---------------- --------
Cash generation reduced to GBP15.6 million (September 2022:
GBP28.3 million) delivered from profit before tax of GBP17.2
million (September 2022: GBP21.0 million). There was a net working
capital outflow of GBP12.6 million, of this GBP2.0 million related
to payment of costs accrued for the Appreciate acquisition at the
year end, GBP2.7m relating to extending payment terms with a key
customer and the remaining amount related to seasonal timing which
is expected to unwind in the second half of the year.
Taxation payments on account of GBP5.1 million (September 2022:
GBP1.3 million) are higher compared to the prior period which
included a tax refund of GBP3.3 million following the closure of
March 2021 tax filings which do not impact the prior year tax
charge. The Corporation tax rate in the year has increased from 19%
to 25%. Dividend payments were higher compared to the prior period
due to the increase in the final ordinary dividend paid per share
for the prior year ended 31 March 2023.
Capital expenditure of GBP7.1 million (September 2022: GBP6.0
million) was GBP1.1 million higher than the prior year. Capital
expenditure primarily consists of PayPoint One and card terminals,
terminal development, the enhancement to the Direct Debit platform
and IT hardware. The increase in capital expenditure is primarily
the result of the inclusion of Love2shop, which accounts for GBP0.8
million of the GBP1.1 million.
DIVIDS
In the six months to 30 September 2023, total dividend payments
of GBP13.5 million or 18.6 pence per share (September 2022: GBP12.4
million or 18.0 pence per share) were made, representing the final
ordinary dividend for the year ended 31 March 2023. This is a 3.3%
increase in the final dividend since last year.
We have declared an increased interim dividend of 19.0 pence per
share (September 2022: 18.4 pence) payable in equal instalments of
9.5 pence per share on 29 December 2023 and 5 March 2024 (to
shareholders on the register on 1 December 2023 and 2 February 2024
respectively). This is an increase of 2.2% compared to the final
dividend declared of 18.6 pence per share, and an increase of 3.3%
compared to the same period last year (September 2022: 18.4
pence).
The interim dividends will result in GBP13.8 million (September
2022: GBP12.7 million) being paid to shareholders from the
standalone statement of financial position of the Company which, as
at 30 September 2023, had approximately GBP36.0 million (September
2022: GBP62.7 million) of distributable reserves.
CAPITAL ALLOCATION
The Board's immediate priority is to continue to preserve
PayPoint's balance sheet strength. The Group maintains a capital
structure appropriate for current and prospective trading over the
medium term that allows a healthy mix of dividends and cash for
investment through capital expenditure and acquisitions. The
Board's approach to the setting of the ordinary dividend has been
updated since the prior year in relation to cover ratio to
strengthen the capital position and follows the following capital
allocation priorities:
-- Investment in the business through capital expenditure in innovation to
drive future revenue streams and improve the resilience and efficiency of
our operations;
-- Investment in opportunities such as the acquisition of Appreciate in
February 2023 and investment in OBConnect convertible loan;
-- Progressive ordinary dividends targeting a cover ratio of 1.5 to 2.0.9
times earnings from continuing operations excluding exceptional items.
GOING CONCERN
The financial statements have been prepared on a going concern
basis having regard to the identified principal risks and
uncertainties. Our cash and borrowing capacity provides sufficient
funds to meet the foreseeable needs of the Group including
dividends.
Rob Harding
Chief Financial Officer
22 November 2023
PayPoint Plc
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS
Re-presented(1)
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
Note GBP000 GBP000 GBP000
Revenue 3 113,988 75,385 165,220
Other revenue 3 12,513 - 2,503
Total revenue 126,501 75,385 167,723
Cost of revenue (64,554) (26,602) (64,257)
Gross profit 61,947 48,783 103,466
Administrative expenses -- excluding
adjusting items (36,566) (24,168) (50,083)
Operating profit before adjusting
items 25,381 24,615 53,383
Adjusting items:
Exceptional items - administrative
expenses 5 (558) (1,553) (5,317)
Amortisation of intangible assets
arising on acquisition -- administrative
expenses (4,038) (1,069) (2,574)
Operating profit 20,785 21,993 45,492
Finance income 463 71 87
Finance costs (4,066) (1,088) (2,718)
Exceptional item -- finance costs 5 - - (287)
Profit before tax 17,182 20,976 42,574
Tax 6 (4,376) (3,931) (7,864)
Profit for the period 12,806 17,045 34,710
Earnings per share (pence)
Basic 17.6 24.7 50.1
------------------------------------------ ----- ------------- --------------- ---------
Diluted 17.4 24.4 49.6
------------------------------------------ ----- ------------- --------------- ---------
Underlying earnings per share --
before adjusting items (pence)
Basic 22.4 28.1 61.0
------------------------------------------ ----- ------------- --------------- ---------
Diluted 22.1 27.8 60.3
------------------------------------------ ----- ------------- --------------- ---------
(1) Amortisation of intangible assets arising on acquisition was
not identified as an adjusting item in the September 2022 financial
statements (see note 1).
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Items that will not be reclassified to
the consolidated statement of profit or
loss:
Remeasurement of defined benefit
pension scheme (845) - 353
Deferred tax on defined benefit pension
scheme 211 - (86)
Foreign exchange 7
Other comprehensive (loss) / income
for the period (627) - 267
Profit for the period 12,806 17,045 34,710
Total comprehensive income for the
period attributable to equity holders
of the parent 12,179 17,045 34,977
---------------------------------------------- ------------- ------------- ---------
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
30 September 30 September 31 March
2023 2022 2023
Note GBP000 GBP000 GBP000
Non-current assets
Goodwill 117,427 57,668 117,427
Other intangible assets 71,157 35,886 75,293
Convertible loan notes 3,750 3,750 3,750
Other investment 251 - 251
Property, plant and equipment 30,729 22,551 29,257
Net investment in finance lease
receivables 915 3,233 1,711
Retirement benefit asset - - 411
Total non-current assets 224,229 123,088 228,100
--------------------------------------- ----- ------------ ------------ --------
Current assets
Inventories 8,417 66 3,152
Trade and other receivables 97,887 81,830 82,055
Current tax asset 7,691 1,562 6,231
Cash and cash equivalents -- clients'
funds, retailer partners' deposits
and card and voucher deposits 118,410 16,636 55,905
Cash and cash equivalents -- corporate
cash 20,325 3,752 22,546
Monies held in trust 83,000 - 82,000
335,730 103,846 251,889
Asset held for sale - 5,502 -
Total current assets 335,730 109,348 251,889
--------------------------------------- ----- ------------ ------------ --------
Total assets 559,959 232,436 479,989
--------------------------------------- ----- ------------ ------------ --------
Current liabilities
Trade and other payables 327,222 96,990 255,526
Lease liabilities 728 157 862
Loans and borrowings 65,585 37,336 58,245
Bank overdraft 1,757 - 525
Total current liabilities 395,292 134,483 315,158
--------------------------------------- ----- ------------ ------------ --------
Non-current liabilities
Trade and other payables 106 - 115
Lease liabilities 4,522 - 4,617
Loans and borrowings 36,165 5,818 36,170
Retirement benefit liability 355 - -
Deferred tax liability 12,763 3,687 12,215
Total non-current liabilities 53,911 9,505 53,117
--------------------------------------- ----- ------------ ------------ --------
Total liabilities 449,203 143,988 368,275
--------------------------------------- ----- ------------ ------------ --------
Net assets 110,756 88,448 111,714
--------------------------------------- ----- ------------ ------------ --------
Equity
Share capital 8 242 230 242
Share premium 8 1,000 1,000 1,000
Merger reserve 8 18,243 999 18,243
Share-based payment reserve 2,042 1,560 2,286
Retained earnings 89,229 84,659 89,943
Total equity attributable to equity
holders of the parent 110,756 88,448 111,714
--------------------------------------- ----- ------------ ------------ --------
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share-
based
Share Share Merger payment Retained Total
capital premium reserve reserve earnings equity
Note GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Opening equity
1 April 2022 230 1,000 999 1,570 79,459 83,258
---------------------------------- -------- -------- -------- -------- --------- --------
Profit for the period - - - - 17,045 17,045
---------------------------------- -------- -------- -------- -------- --------- --------
Comprehensive income
for the period - - - - 17,045 17,045
Equity-settled share-based
payment expense - - - 556 - 556
Vesting of share scheme - - - (566) 566 -
Dividends - - - - (12,411) (12,411)
Closing equity
30 September 2022 230 1,000 999 1,560 84,659 88,448
---------------------------------- -------- -------- -------- -------- --------- --------
Profit for the period - - - - 17,665 17,665
Total other comprehensive
income - - - - 267 267
Comprehensive income
for the period - - - - 17,932 17,932
Issue of shares 12 - 17,244 - - 17,256
Equity-settled share-based
payment expense - - - 774 - 774
Vesting of share scheme - - - (48) 48 -
Dividends - - - - (12,696) (12,696)
Closing equity
31 March 2023 242 1,000 18,243 2,286 89,943 111,714
---------------------------------- -------- -------- -------- -------- --------- --------
Profit for the period - - - - 12,806 12,806
Total other comprehensive
income - - - - (627) (627)
Comprehensive income
for the period - - - - 12,179 12,179
Equity-settled share-based
payment expense - - - 690 - 690
Vesting of share scheme - - - (934) 623 (311)
Dividends - - - - (13,516) (13,516)
Closing equity
September 2023 242 1,000 18,243 2,042 89,229 110,756
---------------------------------- -------- -------- -------- -------- --------- --------
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Re-presented(1)
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
Note GBP000 GBP000 GBP000
Net cash generated by operations 9 81,545 29,391 102,182
Corporation tax paid (5,095) (1,321) (6,204)
Interest received 46 71 609
Interest paid (3,527) (1,126) (2,973)
Net cash inflow from operating
activities 72,969 27,015 93,614
Investing activities
Purchases of property, plant and
equipment (4,827) (3,075) (7,802)
Purchases of intangible assets (2,233) (2,950) (4,900)
Acquisitions of subsidiaries net
of cash acquired - - (45,580)
Contingent consideration cash
paid - (1,000) (1,000)
Disposal of investment in associate - - 5,487
Purchase of convertible loan note - (3,000) (3,000)
Purchase of other investment - - (251)
Net cash used in investing activities (7,060) (10,025) (57,046)
--------------------------------------- ----- ------------- --------------- ---------
Financing activities
Dividends paid (13,516) (12,411) (25,107)
Proceeds from issue of share capital - - 1
Payment of lease liabilities (677) (110) (261)
Repayment of loans and borrowings (7,664) (8,380) (22,074)
Proceeds from loans and borrowings 15,000 - 64,500
Net cash (used in) / generated
from financing activities (6,857) (20,901) 17,059
--------------------------------------- ----- ------------- --------------- ---------
Net increase / (decrease) in cash
and cash equivalents 59,052 (3,911) 53,627
Cash and cash equivalents at beginning
of year 77,926 24,299 24,299
Cash and cash equivalents at period
end 136,978 20,388 77,926
--------------------------------------- ----- ------------- --------------- ---------
(1) Interest received was presented within the heading "Investing activities"
in the prior period.
Reconciliation of cash and cash
equivalents
Corporate cash 20,325 3,752 22,546
Clients' funds, retailer partners'
deposits and card and voucher
deposits 118,410 16,636 55,905
Bank overdraft (1,757) - (525)
Cash and cash equivalents on the
condensed consolidated statement
of financial position 136,978 20,388 77,926
--------------------------------------- ----- ------------- --------------- ---------
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
1. Accounting policies
Reporting entity
PayPoint plc ('PayPoint' or the 'Company') is a public limited
company, incorporated and registered in the UK under the Companies
Act 2006. Its registered office is at Unit 1, The Boulevard, Welwyn
Garden City, Hertfordshire, AL7 1EL. Its shares are listed on the
London Stock Exchange.
These condensed consolidated interim financial statements
('interim financial statements') as at and for the six months ended
30 September 2023 are made up of the Company and its subsidiaries
(together referred to as the 'Group'). They were approved for issue
on 22 November 2023.
These interim financial statements do not comprise statutory
accounts within the meaning of section 434 of the Companies Act
2006. Statutory accounts for the year ended 31 March 2023 were
approved by the board of directors on 27 July 2023 and delivered to
the Registrar of Companies. The report of the auditor on those
accounts was unqualified, did not contain an emphasis of matter
paragraph and did not contain any statements under section 498 of
the Companies Act 2006.
The financial statements have been reviewed, not audited.
Basis of preparation
The interim financial statements for the half-year reporting
period ended 30 September 2023 have been prepared in accordance
with the UK-adopted International Accounting Standard 34 Interim
Financial Reporting and the Disclosure Guidance and Transparency
Rules sourcebook of the UK's Financial Conduct Authority.
Adoption of standards and policies
The accounting policies applied by the Group in the interim
financial statements for the period ended 30 September 2023 are
consistent with those set out in the Group's Annual Report for the
year ended 31 March 2023.
Going concern
The interim financial statements have been prepared on a going
concern basis. The Group manages its capital to ensure that
entities in the Group will be able to continue as a going concern
while maximising the return to shareholders through the
optimisation of the debt-to-equity balance. The capital structure
of the Group consists of debt, cash and cash equivalents and equity
attributable to equity holders of the parent comprising capital,
reserves and retained earnings.
The Group's policy is to borrow centrally to meet anticipated
funding requirements. Our cash and borrowing capacity provides
sufficient funds to meet the foreseeable needs of the Group. At 30
September 2023, the Group had cash and cash equivalents of GBP136.9
million, consisting of GBP20.3 million corporate cash, GBP118.4
million clients' fund, retailer partners' deposits and card and
voucher deposits and GBP1.8 million bank overdraft. The Group's
borrowing facilities consist of:
-- GBP5.4 million amortising term loan which is due to be repaid in
quarterly instalments, completing in February 2024.
-- GBP36.0 million amortising term loan repayable from May 2024 to February
2026 in equal, quarterly instalments until the final, double payment.
-- GBP75.0 million unsecured revolving credit facility with an additional
GBP30.0 million accordion facility (uncommitted) expiring in February
2026.
-- GBP0.3 million block loan balances, to be repaid within 6 months of the
period-end.
At 30 September 2023, GBP59.5 million (31 March 2023: GBP46.5
million) was drawn down from the revolving credit facility and the
Group also had GBP0.3 million block loan balances.
The Group has a strengthened statement of financial position,
with net assets of GBP110.8 million as at 30 September 2023 (30
September 2022: GBP88.4 million), having made a profit for the
period of GBP12.8 million (30 September 2022: GBP17.0 million) and
delivered net cash flows from operating activities of GBP72.7
million for the period then ended (30 September 2022: GBP27.0
million). Net debt increased from GBP72.4m to GBP83.2m in the
period, the GBP10.8m increase comprising a net, pre-dividend inflow
of GBP2.7m and dividend payments of GBP13.5m. In the prior period,
net debt decreased by GBP4.5m, comprising a net, pre-dividend
inflow of GBP16.9m and dividend payments of GBP12.4m. The Group has
net current liabilities of GBP59.6 million at 30 September 2023 (30
September 2022: GBP25.1 million), which includes the drawn down
revolving credit facility balance of GBP59.5 million (31 March
2023: GBP46.5 million). This balance is classified as a current
liability at 31 March 2023 and at each of the comparative dates,
reflecting the fact that each individual borrowing tranche drawn
down from the revolving credit facility is for a period of less
than 12 months. The net current liability position does not affect
the Group's ability to continue as a going concern as the facility
is not required to be repaid until February 2026
The Directors have prepared cash flow forecast scenarios for a
period of at least 12 months from the date of this announcement,
taking into account the Group's current financial and trading
position, the impact of current economic conditions, the principal
risks and uncertainties and the strategic plans that are reviewed
at least annually by the Board. In this 'base case' scenario, the
cash flow forecasts show considerable liquidity headroom and debt
covenants will be met throughout the period. The Directors have
also considered the matters described in note 10 and concluded that
it is not appropriate to extend the going concern assessment beyond
the 12 months on the basis that the timing of conclusion of legal
proceedings is so uncertain.
In addition to the 'base case' scenarios, the Directors have
also prepared a 'downside' scenario which includes the following
assumptions:
Shopping
-- No growth in the PayPoint One estate
-- Double the decline in cards merchant count which was experienced in the
year-ended 31 March 2023
-- Double the decline in the ATM estate which was experienced in the
year-ended 31 March 2023
-- No growth or management challenge achieved in other areas
E-commerce
-- No growth or management challenge achieved
Payments and banking
-- Double the transaction decline which was experienced in the year-ended 31
March 2023
-- Management challenge not achieved
Love2Shop
-- 10% decline in billings across all channels
Even with the above assumptions, the forecasts indicated that
there was sufficient headroom and liquidity for the Group to
continue with the existing facilities outlined above.
Based on these assessments, the Directors confirm that they have
a reasonable expectation that the Group will be able to continue in
operation and meet its liabilities as they fall due over the period
of not less than 12 months from the date of approval of these
interim financial statements and therefore have prepared the
interim financial statements on a going concern basis.
Alternative performance measures
Non-IFRS measures or alternative performance measures are used
by the Directors and management for performance analysis, planning,
reporting and incentive setting purposes which have remained
consistent with the alternative performance measures disclosed in
the Annual Report for the year ended 31 March 2023. These measures
are included in these interim financial statements to provide
additional useful information on performance and trends to
shareholders.
These measures are not defined terms under IFRS and therefore
they may not be comparable with similarly titled measures reported
by other companies. They are not intended to be a substitute for,
or superior to, IFRS measures.
Underlying performance measures (non-IFRS measures)
Underlying performance measures allow shareholders to understand
the operational performance in the year, to facilitate comparison
with prior years and to assess trends in financial performance.
They usually exclude the impact of one-off, non-recurring and
exceptional items and the amortisation of intangible assets arising
on acquisition, such as brands and customer relationships.
Love2Shop billings (non-IFRS measures relating solely to the
Love2Shop segment)
Billings represents the value of goods and services shipped and
invoiced to customers during the year and is recorded net of VAT,
rebates and discounts. Billings is an alternative performance
measure, which the directors believe provides an additional measure
of the level of activity other than revenue. This is due to
billings being recognised at a different time to revenue from
multi-retailer products and revenue from multi-retailer redemption
products being reported on a 'net' basis, whilst revenue from
single-retailer redemption products and other goods are reported on
a 'gross' basis.
Net revenue (non-IFRS measure)
Net revenue is revenue less commissions paid (to retailer
partners and Park Christmas agents) and the cost of revenue for
items where the Group acts in the capacity as principal (including
single-retailer vouchers and SIM cards). This reflects the benefit
attributable to the Group's performance, eliminating pass-through
costs which creates comparability of performance under both the
agent and principal revenue models. It is a key consistent measure
of the overall success of the Group's strategy. A reconciliation
from revenue to net revenue is included in note 4.
Adjusting items (non-IFRS measure)
Adjusting items consist of exceptional items and amortisation of
intangible assets arising on acquisition. These items are presented
as adjusting items in the consolidated statement of profit or loss,
as they do not reflect the operational performance of the Group.
Further details of the exceptional items are provided in note
5.
Re-presented(1)
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Exceptional item -- professional fees 558 - -
Exceptional item -- acquisition costs
expensed - 300 4,065
Exceptional item -- impairment loss
on reclassification of investment in
associate to asset held for sale - 1,253 1,252
Exceptional item -- finance costs - - 287
Amortisation of intangible assets arising
on acquisition 4,038 1,069 2,574
Total adjusting items 4,596 2,622 8,178
------------------------------------------ ------------ ---------------- --------
(1) Amortisation of intangible assets arising on acquisition
were not identified as adjusting items in the September 2022
financial statements (see note 1).
See note 5 for explanations of the above exceptional items.
Effective tax rate (non-IFRS measure)
Effective tax rate (note 6) is the tax charge as a percentage of
the net profit before tax.
Reported dividends (non-IFRS measure)
Reported dividends for an interim reporting period are based on
that period's results from which the dividend is declared and
consist of the interim dividend declared. This is different to
statutory dividends where the final dividend on ordinary shares is
recognised in the following interim period when it is approved by
the Company's shareholders.
Cash generation (non-IFRS measure)
Cash generation reflects earnings before tax, depreciation,
amortisation and non-cash exceptional items adjusted for working
capital (excluding movement in clients' funds, retailers partners'
deposits and card and voucher deposits) as detailed in the
financial review. This measures the cash generated which can be
used for tax payments, new investments, payment of dividends and
financing activities.
Total costs (non-IFRS measure)
Total costs comprise other cost of revenue, administrative
expenses, financing income and financing costs. Total costs exclude
adjusting items, being exceptional costs and amortisation of
intangible assets arising on acquisition.
Earnings before interest, tax, depreciation and amortisation
(EBITDA) (non-IFRS measure)
The Group now presents EBITDA, as it is widely used by
investors, analysts and other interested parties to evaluate
profitability of companies. This measures earnings from continuing
operations before interest, tax, depreciation and amortisation.
Underlying earnings before interest, tax, depreciation and
amortisation (Underlying EBITDA) (non-IFRS measure)
The Group also now presents underlying EBITDA, which comprises
EBITDA, as defined above, excluding exceptional items.
Underlying earnings per share (non-IFRS measure)
Underlying earnings per share is calculated by dividing the net
profit from continuing operations before exceptional items and
amortisation of intangible assets arising on acquisition
attributable to equity holders of the parent by the basic or
diluted weighted average number of ordinary shares in issue.
Underlying profit before tax (non-IFRS measure)
The calculation of underlying profit before tax is as
follows:
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Profit before tax 17,182 20,976 42,574
Total adjusting items 4,596 2,622 8,178
Underlying profit before tax 21,778 23,598 50,752
Underlying profit after tax (non-IFRS measure)
The calculation of underlying profit after tax is as
follows:
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Profit after tax 12,806 17,045 34,710
Total adjusting items 4,596 2,622 8,178
Tax on adjusting items (1,149) (267) (644)
Underlying profit after tax 16,253 19,400 42,244
Net corporate debt (non-IFRS measure)
Net corporate debt represents cash and cash equivalents
excluding cash recognised as clients' funds and retailer partners'
deposits, less bank overdraft and amounts borrowed under financing
facilities (excluding IFRS 16 liabilities).
The reconciliation of cash and cash equivalents to net corporate
debt is as follows:
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Cash and cash equivalents - corporate
cash 20,325 3,752 22,546
Less:
Bank overdraft (1,757) - (525)
Loans and borrowings (101,750) (43,154) (94,415)
Net corporate debt (83,182) (39,402) (72,394)
-------------------------------------- ------------ ------------ --------
Use of judgements and estimates
In the application of the Group's accounting policies, the
Directors are required to make judgements, estimates and
assumptions about the carrying amounts of assets and liabilities
that are not readily apparent from other sources. The estimates and
associated assumptions are based on historical experience and other
factors that are considered to be relevant. Actual results may
differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimate is revised if the revision affects
only that period, or in the period of the revision and future
periods if the revision affects both current and future
periods.
Critical judgement: recognition of cash and cash equivalents
The nature of payments and banking services means that PayPoint
collects and holds funds on behalf of clients as those funds pass
through the settlement process and retains retailer partners'
deposits as security for those collections. Following the
Appreciate acquisition, it also holds card and voucher deposits on
behalf of agents, cardholders and redeemers, some of which is held
in trust.
A critical judgement in this area is whether clients' funds,
retailer partners' deposits and monies held in trust are recognised
in the statement of financial position, and whether they are
included in cash and cash equivalents for the purpose of the
statement of consolidated cash flows. This includes evaluating:
(a) the existence of a binding agreement, such as a legal trust, clearly identifying the beneficiary of the funds
(b) the identification of funds, ability to allocate and separability of funds
(c) the identification of the holder of those funds at any point in time
(d) whether the Group bears the credit risk
Where there is a binding agreement specifying that PayPoint
holds funds on behalf of the client (i.e. acting in the capacity of
a trustee) and those funds have been separately identified as
belonging to that beneficiary, the cash and the related liability
are not included in the statement of financial position.
Where funds are held in trusts set up for the purpose of
ring-fencing monies belonging to agents, cardholders and redeemers,
they are recognised as monies held in trust on the statement of
financial position, as the Group has access to the interest on such
monies and can, having met certain conditions, withdraw the funds.
However, given the restrictions over these monies, the amounts held
in trust and ring-fenced are not included in cash and cash
equivalents.
In all other situations the cash and corresponding liability are
recognised on the statement of financial position. Corporate cash
and clients' funds, retailer partners' deposits and card and
voucher deposits are presented as separate line items within cash
and cash equivalents on the statement of financial position.
The amounts recognised on the Statement of financial position as
at 30 September 2023 are as follows:
-- Cash and cash equivalents - clients' funds GBP15.8 million (31 March
2023: GBP12.0 million)
-- Cash and cash equivalents - retailers' deposits GBP0.5 million (31 March
2023: GBP6.2 million
-- Cash and cash equivalents -- card and voucher deposits GBP102.1 million
(31 March 2023: GBP37.7 million)
-- Cash and cash equivalents - corporate cash GBP20.3 million (31 March
2023: GBP22.5 million
-- Monies held in trust GBP83.0 million (31 March 2023: GBP82.0 million)
The increase in the card and voucher deposits balance since 31
March 2023 reflects the seasonality of Love2Shop's business. Its
clients purchase redemption products most heavily in the peak
September to December period, resulting in a higher balance at
September than in March each year.
Clients' funds held in trust off the statement of financial
position as at 30 September 2023 are GBP49.2 million (31 March
2023: GBP124.3 million). The 31 March 2023 amount included total
one-off balances of GBP50m arising from the Group's participation
in the Government's Energy Bills Support Scheme.
Critical estimate: Valuation of the goodwill relating to the
Handepay cash generating unit
Handepay's principal activity is that of an independent sales
organisation in the merchant acquiring industry. It is a growth
business that has strong cash generation and limited capital
expenditure requirements. The market in which it operates is highly
competitive and facing several regulatory changes. Handepay has a
relatively small market share, however it continues to develop its
proposition, sales force, and operations with an ambition to
accelerate the growth of its market share. Handepay is a CGU for
the purposes of impairment testing.
The Handepay CGU generated a value in use (VIU) in excess of its
carrying value, therefore, the CGU and its assets continue to be
measured at their carrying value. Sensitivity analysis was applied
to determine the impacts of reasonably possible changes in the
assumptions used for the VIU calculation. A reasonable change in
these assumptions could give rise to an impairment as was the case
at the 31 March 2023 year-end.
The key assumptions underpinning the recoverable amounts that
are most sensitive to a reasonable change, as was the case in March
2023, continue to be:
1. The average revenue growth assumption
2. Pre-tax discount rate
2. Segmental reporting
The Group provides a number of different services and products.
However, prior to the acquisition of Appreciate Group PLC on 28
February 2023, the different services and products provided by the
Group did not meet the definition of different operating segments
under IFRS 8, as the chief operating decision maker (CODM), the
Executive Board, did not review them separately to make decisions
about resource allocation and performance. Therefore, the Group had
only one operating segment.
The Group considers the Appreciate business, now known as
Love2Shop, to be a separate segment from its pre-acquisition
PayPoint business, since discrete financial information is prepared
and it offers different products and services. Furthermore, the
CODM reviews separate monthly internal management reports
(including financial information) for both PayPoint and Love2Shop
to allocate resources and assess performance.
The material products and services offered by each segment are
as follows:
PayPoint
-- Card payment services to retailers, including leased payment devices
-- ATM cash machines
-- Bill payment services and cash top-ups to individual consumers, through a
network of retailers
-- Parcel delivery and collection
-- Retailer service fees
-- Digital payments
Love2Shop
-- Shopping vouchers, cards and e-codes which customers may redeem with
participating retailers. These are either 'single-retailer' or
'multi-retailer'. The former may only be used at the specified retailer,
whilst the latter may be redeemed at one or more of over 200 retailers.
-- Christmas savings club, to which customers make regular payments
throughout the year to help spread the cost of Christmas, before
converting to a voucher.
Information related to each reportable segment, for the period
ended 30 September 2023 and as at that date, is set out below.
Segment profit / (loss) before tax, exceptional items and
amortisation of intangible assets arising on acquisition is used to
measure performance because management believes that this
information is the most relevant in evaluating the results of the
respective segments relative to other entities that operate in the
same industries.
The Group operates exclusively in the UK.
6 months ended 30 September 2023 PayPoint Love2Shop Total
and as at 30 September 2023 GBP000 GBP000 GBP000
Revenue 80,232 33,756 113,988
Other revenue 1,010 11,503 12,513
Segment revenue 81,242 45,259 126,501
Segment profit / (loss) before
tax and adjusting items 23,564 (1,786) 21,778
Exceptional items (558) - (558)
Amortisation of intangible assets
arising on acquisition (1,069) (2,969) (4,038)
Segment profit / (loss) before
tax 21,937 (4,755) 17,182
Interest income 46 417 463
Interest expense 1,439 2,617 4,066
Depreciation and amortisation 5,519 4,204 9,723
Capital expenditure 6,240 820 7,060
Segment assets 241,231 318,728 559,959
Segment liabilities 138,570 310,633 449,203
Segment equity 102,661 8,095 110,756
Year ended 31 March 2023 and as PayPoint Love2Shop Total
at 31 March 2023 GBP000 GBP000 GBP000
Revenue 159,531 5,689 165,220
Other revenue 575 1,928 2,503
Segment revenue 160,106 7,617 167,723
Segment profit before tax and
adjusting items 50,296 456 50,752
Exceptional items (5,604) - (5,604)
Amortisation of intangible assets
arising on acquisition (2,139) (435) (2,574)
Segment profit before tax 42,553 21 42,574
Interest income 29 58 87
Interest expense 2,303 415 2,718
Depreciation and amortisation 9,819 658 10,477
Capital expenditure 12,349 354 12,703
Segment assets 219,649 260,340 479,989
Segment liabilities 125,113 243,162 368,275
Segment equity 94,536 17,178 111,714
3. Revenue
Disaggregation of revenue
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
(Shopping)
Card payments 12,360 12,390 24,293
Terminal lease income 4,026 3,467 7,542
Service fees 9,695 8,910 17,947
ATMs 6,093 6,727 12,920
Other shopping 1,895 1,424 3,355
(Shopping total) 34,069 32,918 66,057
------------------------------ ------------- ------------- ---------
(e-commerce total) 14,141 8,143 20,183
(Payments and banking)
(Cash -- bill payments) 13,381 16,928 34,135
(Cash -- top-ups) 5,811 6,046 11,959
(Digital) 8,442 6,842 18,081
(Cash through to digital) 3,776 3,844 7,769
(Other payments and banking) 612 664 1,347
(Payments and banking total) 32,022 34,324 73,291
------------------------------ ------------- ------------- ---------
Love2Shop -- card and voucher
service fee 33,756 - 5,689
Total 113,988 75,385 165,220
------------------------------ ------------- ------------- ---------
Management fees, set-up fees and up-front lump sum payments of
GBP0.5 million (September 2022: GBP0.3 million) are recognised on a
straight-line basis over the period of the contract. Service fee
revenue is recognised on a straight-line basis over the period of
the contract. Card terminal leasing revenue is recognised over the
expected lease term using the sum of digits method for finance
leases and on a straight-line basis for operating leases.
Multi-retailer voucher, card and e-code service fee revenue is
recognised on redemption by the customer. The remainder of revenue
is recognised at the point in time when each transaction is
processed. The usual timing of payment by PayPoint customers is on
fourteen-day terms. The usual timing of Love2Shop's corporate
customers is fifteen-day terms; its consumer customers pay on
ordering.
Revenue subject to variable consideration of GBP6.7 million
(September 2022: GBP7.0 million) exists where the consideration
which PayPoint is entitled to varies according to transaction
volumes processed and rate per transaction. Management estimates
the total transaction price using the expected value method at
contract inception, which is reassessed at the end of each
reporting period, by applying a blended rate per transaction to
estimated transaction volumes. Any required adjustment is made
against the transaction prices in the period to which it relates.
The revenue is recognised at the constrained amount to the extent
that it is highly probable that the inclusion will not result in a
significant revenue reversal in the future, with the estimates
based on projected transaction volumes and historical experience.
The potential range in outcomes for revenue subject to variable
consideration resulting from changes in these estimates is not
material.
Seasonality of operations
Following the Group's acquisition of Love2Shop on 28 February
2023, its performance is now considered "highly seasonal" under IAS
34 Interim Financial Reporting. The Love2Shop business is heavily
weighted towards the second half of the current financial year, in
particular the peak September to December pre-Christmas period when
revenues from card, voucher and e-code redemptions are at their
highest.
The PayPoint business is far less seasonal, although its
e-commerce division also generates its highest revenues in the
pre-Christmas months. Bill payments transactions, which were
historically higher during the winter months (H2), continue to be
impacted by the shift in consumer behaviour towards making fewer,
larger payments and structural changes in this market. Card
payments typically generates higher value processed and revenue in
the summer months (H1). Card terminal leasing revenue is relatively
unaffected by seasonality.
Other revenue
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
PayPoint
Interest revenue 1,010 - 575
Love2Shop
Interest revenue 3,374 - 325
Non-redemption revenue 8,129 - 1,603
(Love2Shop total) 11,503 - 1,928
----------------------- ------------- ------------- ---------
Total 12,513 -2,503
------ ------ -----
Other revenue comprises:
Payments and banking
-- Interest earned on clients' funds and retailer partners' deposits.
Love2Shop
-- Multi-retailer non-redemption revenue (where the end-user has the right
of refund), recognised when the product has expired and the right of
refund lapsed.
-- Multi-retailer non-redemption revenue (where the end-user has no right of
refund), recognised on expiry.
-- Interest generated by investing cash received from customers. This
applies both to cash received for the Park Christmas Saver business where
customers save with the Group throughout the year, and to all other
pre-paid products. Funds associated with customers are included in both
monies held in trust and cash and cash equivalents.
4. Alternative performance measures
Net revenue
The reconciliation between total revenue and net revenue is as
follows:
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Service revenue -- Shopping 34,069 31,286 66,057
Service revenue -- e-commerce 13,609 8,143 16,085
Service revenue -- Payments and
banking 31,425 33,687 71,994
Service revenue -- multi-retailer
redemption products 2,938 - 1,217
Service revenue -- other 2,040 - 128
Sale of goods -- single-retailer
redemption products 28,776 - 4,325
Sale of goods -- other 599 637 1,316
Royalties -- e-commerce 532 1,632 4,098
Other revenue -- multi-retailer
non-redemption income 8,129 - 1,603
Other revenue -- interest on clients'
funds, retailer partners' deposits
and card and voucher deposits 4,384 - 900
Total revenue 126,501 75,385 167,723
less:
Retailer partners' commissions (18,960) (15,818) (34,369)
Cost of single-retailer cards and
vouchers (27,657) - (4,208)
Cost of SIM cards and e-money sales
as principal (83) (95) (199)
Net revenue from continuing operations 79,801 59,472 128,947
-------------------------------------- ------------- ------------- ---------
Total costs
Total costs, excluding adjusting items, comprises:
Re-presented(1)
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Other costs of revenue 17,854 10,689 25,481
Administrative expenses -- excluding
adjusting items 36,566 24,168 50,083
Finance income (463) (71) (87)
Finance costs 4,066 1,088 2,718
Total costs 58,023 35,874 78,195
(1) Amortisation of intangible assets arising on acquisition
were not identified as adjusting items in the September 2022
financial statements (see note 1).
Love2Shop billings
Billings relates solely to Love2Shop and represents the value of
goods and services dispatched and invoiced to customers during the
year. The reconciliation between Love2Shop's billings and total
revenue is as follows, with the 31 March 2023 comparative figures
representing only one month's trading after Love2Shop's acquisition
by PayPoint on 28 February 2023:
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Love2Shop billings 105,064 - 14,807
Multi-retailer redemption products
-- gross to net revenue recognition (63,179) - (7,515)
Other revenue -- interest on card
and voucher deposits 3,374 - 325
Love2Shop total revenue 45,259 - 7,617
------------------------------------- ------------- ------------- ---------
5. Exceptional items
Re-presented(1)
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
-------------------------------------------- ------------- --------------- ---------
Legal fees - administrative expenses 558 - -
-------------------------------------------- ------------- --------------- ---------
Acquisition costs expensed - administrative
expenses - 300 4,065
-------------------------------------------- ------------- --------------- ---------
Impairment loss on reclassification
of investment in associate to asset
held for sale - 1,253 1,252
-------------------------------------------- ------------- --------------- ---------
Total exceptional items included
in operating profit 558 1,553 5,317
-------------------------------------------- ------------- --------------- ---------
Refinancing costs expensed -- finance
costs - - 287
-------------------------------------------- ------------- --------------- ---------
Total exceptional items included
in profit or loss 558 1,553 5,604
-------------------------------------------- ------------- --------------- ---------
The tax impact of the exceptional items is GBP0.14 million
(September 2022: GBPnil).
Exceptional items are those which are considered significant by
virtue of their nature, size or incidence. These items are
presented as exceptional within their relevant income statement
categories to assist in the understanding of the performance and
financial results of the Group, as they do not form part of the
underlying business.
The current period legal fees relate to the Group's defence of 2
claims served on a number of its companies in connection with
issues addressed by commitments accepted by Ofgem as a resolution
of its concerns raised in Ofgem's Statement of Objections received
by the Group in September 2020. The Group remains confident that it
will successfully defend both claims.
The prior period acquisition costs related to the acquisition of
Appreciate Group PLC on 28 February 2023.
The prior period impairment loss arose on the reclassification
of the Group's interest in Snappy Shopper Ltd from an investment in
associate to an asset held for sale. The Group subsequently
disposed of its interest in Snappy Shopper on 14 October 2022.
The prior period refinancing costs related to the acquisition of
Appreciate Group PLC.
6. Tax
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Current tax 3,617 3,949 7,023
Deferred tax 759 (18) 841
Total 4,376 3,931 7,864
Effective tax rate 25.5% 18.7% 18.5%
Tax charged directly to other comprehensive
income
Deferred tax (credit) / charge on actuarial
(losses) / gains on defined benefit pension
plans (211) - 86
The tax charge was GBP4.4 million (September 2022: GBP3.9
million) resulting in an effective tax rate of 25.5% (September
2022: 18.7%). This is higher than the UK statutory rate of 25% due
to adjustments relating to share-based payments.
An increase in the main rate of UK corporation tax from 19% to
25% was enacted in June 2021 with effect from 1 April 2023.
Deferred tax has been calculated based on the rate applicable at
the date timing differences are expected to reverse.
7. Earnings per share
Basic and diluted earnings per share are calculated on the net
profit attributable to equity holders of the parent and the
weighted average number of ordinary shares in issue as follows:
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Net profit attributable to equity
holders of the parent
Profit after tax 12,806 17,045 34,710
Underlying profit after tax 16,253 19,400 42,244
30 September 30 September 31 March
2023 2022 2023
Number of Number of Number of
Shares Shares Shares
Thousands Thousands Thousands
Weighted average number of ordinary
shares in issue (for basic earnings
per share) 72,603 69,051 69,281
Potential dilutive ordinary shares:
Long-term incentive plan - 59 -
Restricted share awards 772 605 588
Deferred annual bonus scheme 185 120 104
SIP and other 60 36 60
Weighted average number of ordinary
shares in issue (for diluted earnings
per share) 73,620 69,871 70,033
--------------------------------------- ------------- ------------- ----------
8. Share capital, share premium and merger reserve
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Called up, allotted and fully paid
share capital
72,672,845 (September 2022: 68,978,647)
ordinary shares of 1/3p each 242 230 242
Total 242 230 242
---------------------------------------- ------------ ------------ --------
In the current period 90,222 shares were issued (of 1/3p each)
for share awards which vested in the period and 19,389 matching
shares were issued (of 1/3p each) under the Employee Share
Incentive Plan.
The share premium of GBP1.0 million (September 2022: GBP1.0
million) represents the payment of deferred, contingent share
consideration in excess of the nominal value of shares issued in
relation to the i-movo acquisition.
The merger reserve of GBP18.2 million (September 2022: GBP1.0
million) comprises GBP1.0 million initial share consideration in
excess of the nominal value of shares issued on the initial
acquisition of i-movo and GBP17.2 million share consideration in
excess of the nominal value of shares issued in relation to the
Appreciate acquisition.
9. Notes to the condensed consolidated statement of cash flows
6 months 6 months Year
ended ended ended
30 September 30 September 31 March
2023 2022 2023
GBP000 GBP000 GBP000
Profit before tax from continuing
operations 17,182 20,976 42,574
Adjustments for:
Depreciation of property, plant
and equipment 3,354 2,375 4,922
Amortisation of intangible assets 6,369 2,341 5,555
Exceptional item -- non-cash impairment
loss on reclassification of investment
in associate to asset held for sale - 1,538 1,252
Loss on disposal of fixed assets - 40 1,090
Finance income (463) (71) (987)
Finance costs 4,066 1,088 2,718
Share-based payment charge 713 556 1,330
Operating cash flows before movements
in corporate working capital 31,221 28,843 58,454
Movement in inventories (5,264) 267 737
Movement in trade and other receivables (6,140) 125 (1,301)
Movement in finance lease receivables 511 1,495 2,366
Movement in contract assets (409) (474) (853)
Movement in contract liabilities (116) 67 (78)
Movement in payables (1,024) (787) 3,688
Movement in lease liabilities 261 1 (90)
------------------------------------------
Cash generated by operations 19,040 29,537 62,923
Movement in clients' funds, retailer
partners' deposits and card and
voucher deposits 62,505 (146) 39,259
Net cash generated by operations 81,545 29,391 102,182
------------------------------------------ ------------- ------------- ---------
10. Contingent liability
Further to the update provided on 28 July 2023, PayPoint can
confirm that a first Case Management Conference (CMC) was held on
31 October 2023 at the Competition Appeal Tribunal relating to the
claims served by Utilita Energy Limited and Utilita Services
Limited ("Utilita") and Global 365 plc and Global Prepaid Solution
Limited ("Global 365"). The focus of the CMC was to agree
disclosure and a timetable for proceedings.
The Group's position remains unchanged: it is confident that it
will successfully defend the claim by Utilita, which does not
provide any clear evidence to support the cause of action or the
amount claimed, and also that it will successfully defend the claim
by Global 365, which fundamentally misunderstands the energy market
and the relationships between the relevant Group companies and the
major energy providers, whilst also over-estimating the opportunity
available, if any, for the products offered by Global 365. As a
result, no accounting provision has been made for these claims.
Given this position, the Group's preference is for a swift and
expedient process, targeting a trial listing on the first available
date to be agreed with all parties.
The Group will continue to update the market on a quarterly
basis as part of its financial reporting cycle.
PRINCIPAL RISKS AND UNCERTAINTIES
Like all businesses, we face a number of risks and uncertainties
and successful management of existing and emerging risks is
critical to the achievement of strategic objectives and to the
long-term success of any business. Therefore, risk management is an
integral part of PayPoint's Corporate Governance. The Group's
principal risks and uncertainties remain the same as those
disclosed in the Strategic Report section of its Annual Report for
the year ended 31 March 2023, which are as follows:
Risk Trend Potential Impact Mitigation Strategies Status
& Appetite
--------------- ---------------------------------- ---------------------------------- --------------------------------
Principal Risks
-----------------------------------------------------------------------------------------------------------------------------
Market Risks
-----------------------------------------------------------------------------------------------------------------------------
1 Competition PayPoint's markets and The Executive Board Risk is increasing as
and Markets competitors continue regularly reviews markets, competition has intensified,
Trend = to evolve; failure to competitor activity, and cost of living pressures
Increasing anticipate and respond trading opportunities are causing a downward
Appetite to these will reduce and potential acquisitions push on margins. Also,
= market share, revenue and so oversees and the use of cash continues
Medium and profits. The decline challenges strategic to decrease, which reduces
in cash usage is expected direction. It also closely our income from certain
to continue, which will monitors consumer and parts of the business.
reduce revenue from technological trends However, we continue
those affected business and engages with clients, to strengthen our card
areas. Inflationary retailers and other and digital payment
and cost of living pressures stakeholders to improve businesses. Levels of
may impact fee margins our proposition. PayPoint global investment in
and discretionary spend, continually develops our Fintech competitors
which will in turn affect products, services and slowed in the last year,
growth opportunities systems to adapt to which presents opportunities
in parts of the business. changes in consumer for PayPoint in the
Keen pricing by competitors trends and technology digital space. Finally,
may further serve to and make strategic acquisitions the recent acquisition
narrow profit margins, where appropriate. has further diversified
as would excessive reliance the Group into the gifting
on key clients or market and rewards business.
segments
--------------- ---------------------------------- ---------------------------------- --------------------------------
2 Emerging There is risk to our PayPoint continually Risk is stable as recent
Technology business if our offering develops products with acquisitions have accelerated
Trend = fails to keep pace and the latest technology our ability to mitigate
Stable we do not exploit new and evolves them to the impact of emerging
Appetite technologies and markets take advantage of new technologies, and the
= Medium to evolve our proposition. and expanding markets. re-platforming of our
New and emerging technologies The Executive Board digital proposition
are changing the way closely monitors emerging will better enable us
consumers pay for goods technologies and the to expand our presence
and services; failure impact they may have in digital payment markets.
to keep up with alternative on PayPoint. We also We are engaged in various
payment solutions will develop and implement government schemes involving
reduce our market share our own innovative technology new technology, for
and profitability where possible. Emerging example, the Department
technology from recent for Work and Pensions
acquisitions has been Payment Exception Service.
developed further and We are rolling out a
used to deepen and widen new, updated version
our customer relationships. of our retailer terminal
-- the PayPoint mini,
and have developed solutions
in our open banking
and open pay propositions.
We are also tracking
the fast evolution of
generative AI, as this
has potential to be
highly transformative.
--------------- ---------------------------------- ---------------------------------- --------------------------------
Strategic Risks
-----------------------------------------------------------------------------------------------------------------------------
3 Trans-formation Our business relies The Executive Board Risk is increasing;
Trend = on implementation of drives, challenges and the acquisition of Appreciate
Increasing continued innovation assesses our response is now complete and
Appetite to keep pace with emerging to change as part of work has started to
= Medium technology and changing the strategic planning integrate their operations
markets. Furthermore, process. PayPoint is where appropriate, and
we need to remain agile committed to diversifying to add their system
to continually improve its product offering improvements into the
our processes and controls, and client base by delivering Group roadmap. Other
as failure to do so innovative, efficient major projects include
would reduce efficiency, and robust processes Payment Facilitation
increase costs, and in a range of sectors, and the roll out of
increase the likelihood and by continuous improvement the PayPoint mini terminal,
of poor customer service. in existing systems a project that started
Failure to invest and and processes. in 2021.These require
improve would also reduce considerable investment
our capacity to capitalise in technology and systems
on opportunities for as well as infrastructure
growth. channels and in developing
people.
--------------- ---------------------------------- ---------------------------------- --------------------------------
Business Risks
-----------------------------------------------------------------------------------------------------------------------------
4 Operating It is important we have PayPoint builds and Risk is stable; recent
Model a diversified and varied carefully manages strategic acquisitions have diversified
Trend = operating model, so relationships with key our operations into
Stable we are not overly exposed clients, retailers, the gifting ad rewards
Appetite to any particular markets, redemption partners business. We continue
= Medium clients, suppliers or and suppliers. We continually to renew contracts and
SMEs. Our core business seek to improve and onboard new retailers,
relies on an appropriate diversify services through clients merchants and
mix of clients operating new initiatives, products redemption partners
in diverse industry and technology. We have in line with expectations.
sectors, retailers and further diversified We have built on the
redemption partners, our business this year counter cash, FMCG and
supported by a robust through the acquisition newspaper propositions
supply chain and operating of Appreciate Group with campaigns and onboarding
processes. Failure to which gives us access new SMEs, with more
maintain attractive to new markets, SMEs, in the pipeline. We
propositions for clients retailers, clients and have however noted that
retailers and redemption technology. We maintain retailers and SMEs are
partners may result strong relationships under increasing financial
in losses of key clients, with suppliers to reduce pressure, which may
or a reduction in fees concentration risk in lead to an increase
and margins. this area. in defaults. We are
monitoring this situation
carefully.
--------------- ---------------------------------- ---------------------------------- --------------------------------
5 Legal and PayPoint is required Our Legal and Compliance Risk is increasing due
Regulatory to comply with numerous teams work closely with to two key factors.
Trend = contractual, legal, management on all legal Firstly, following completion
Increasing and continuously evolving and regulatory matters of the Appreciate acquisition,
Appetite regulatory requirements. and adopt strategies additional support has
= Low Failure to anticipate to ensure PayPoint is been required to ensure
and meet obligations appropriately protected a coherent group approach
may result in fines, and complies with regulatory to compliance is implemented.
penalties, prosecution requirements. The teams Secondly, as referenced
and reputational damage. advise on all key contracts in Note 34, two claims
Recent acquisitions and legal matters and have now been served
have increased the number oversee regulatory compliance, on a number of companies
of regulated entities, monitoring and reporting. in the Group in
which further increases Emerging regulations relation to the matters
the regulatory risk. are incorporated into addressed by commitments
Commitments made to strategic planning, made to Ofgem in 2021
Ofgem in 2021 regarding and we engage with regulators in resolution of Ofgem's
its Competition law to ensure our frameworks competition concerns.
concerns have been implemented are appropriate to support Key new regulations
new products and initiatives. this year have been
The compliance team the PSR and Consumer
has been expanded and Duty, which we are addressing
developed to meet the in line with regulatory
ever-changing requirements deadlines.
of both existing and
new legislation, and
external counsel is
engaged where required.
We respond promptly
and comprehensively
to all legal and regulatory
enquiries.
--------------- ---------------------------------- ---------------------------------- --------------------------------
6 People Failure to attract and The Executive Board Risk is increasing.
Trend = retain key talent impacts defines and advocates Following completion
Increasing many areas of our business PayPoint's purpose, of the Appreciate Group
Appetite including service delivery vision and values, and acquisition, we announced
= Low and achieving strategic an employee forum comprising a rationalisation of
objectives. Maintaining employees from across our Northern offices,
a strong culture of the business engages which has caused some
ethical behaviours and directly with the Executive staff turnover. Inflationary
employee wellbeing is Board on employee matters. pressures mean salaries
also vital in ensuring We continue to invest remain high and, hybrid
our business, people, in, and support our working serves to exacerbate
customers and other people. We have well this trend. Therefore,
stakeholders are safeguarded, established processes there remain a number
and our operations remain for recruiting and retaining of vacancies, especially
efficient and profitable. key talent and developing in specialist fields.
Maintaining competitive our people, and there However, we have recruited
remuneration levels is continued focus on some extra staff in
ensures we retain our culture, ethics and accordance with our
talent pool. diversity. planned headcount increase
for the year. Recruitment
and retention have eased
somewhat from earlier
in the year due to redundancies
and recruitment freezes
elsewhere.
Employee engagement
surveys remain positive
and key actions around
cost-of-living support,
better employee interaction
and flexible working
have been implemented..
--------------- ---------------------------------- ---------------------------------- --------------------------------
Operational Risks
-----------------------------------------------------------------------------------------------------------------------------
7 Cyber Cyber-attacks may significantly The Executive Board Risk is increasing because
Security impact service delivery assesses PayPoint's of the growing volume
Trend = and data protection cyber security and data and sophistication of
Increasing causing harm to PayPoint, protection framework, cyber-attacks, coupled
Appetite our customers and other and the Cyber Security with our expanding digital
= Low stakeholders. Recent and IT Sub-Committee footprint. Due to the
acquisitions have increased of the Audit Committee current geopolitical
the number of IT environments, maintain oversight. instability, the NCSC
products and systems Our IT security framework has issued a warning
we need to protect. is comprehensive, with regarding targeted threats
PayPoint has multiple multiple security systems to organisations supporting
cyber security systems, and controls deployed critical services in
capabilities and controls across the Group. the UK.
however cyber-attacks We are ISO27001 and Group security standards
are constantly evolving PCI DSS Level 1 certified, and systems are being
and remain a persistent and systems are constantly applied to our acquired
threat. monitored for attacks IT environments and
with response plans we continue to enhance
implemented and tested. our architecture, systems,
Employees receive regular processes and cyber
cyber security training, monitoring and response
and awareness is promoted capabilities. We regularly
through phishing simulations engage third parties
and other initiatives. to assess and assist
We have implemented on our cyber defences
simple reporting tools and strengthen our controls..
to assist in quick identification
of potential threats.
We operate a robust
incident response framework
to address potential
and actual breaches
in our estate or within
our supply chain. We
engage with stakeholders,
including suppliers
on cyber-crime and proactively
manage adherence with
data protection requirements.
--------------- ---------------------------------- ---------------------------------- --------------------------------
8 Business Our clients and stakeholders The Executive Board Risk is increasing.
Interruption rely on our systems, reviews PayPoint's business The acquisition of Appreciate
Trend = products and services continuity framework and our expansion into
Increasing being resilient to maintain and the Cyber Security different products contribute
Appetite continuous service delivery. and IT SubCommittee to an increasing complexity
= Low Failure to maintain of the Audit Committee of our operations. We
stable infrastructure maintains oversight. have not suffered any
or processes, or to Business continuity, significant outages
promptly recover services disaster recovery and during the year, however
following an incident major incident response system disruption is
may result in financial plans are maintained an inherent business
loss, reputational harm and tested with failover risk. Therefore, we
and potential regulatory capabilities across have upgraded the processing
scrutiny. third party data centres environments for our
Interruptions may be and the cloud. Systems core switch and some
caused by system failure, are routinely upgraded core services that are
cyberattack, failure with numerous change hosted in the data centres.
by a third party, or management processes This has resulted in
failure of an internal deployed and resilience a reduction in critical
process. Recovery may embedded where possible. incidents, and availability
be hampered by a lack Risk from supplier failure of the core processing
of resilience planning is managed through contractual switch has improved.
and testing. arrangements, alternative Better staff training
supplier arrangements and retention has enhanced
and business continuity our ability to detect
plans. and recover from service
issues.
--------------- ---------------------------------- ---------------------------------- --------------------------------
9 Credit and PayPoint has material PayPoint has effective Risk is stable. Credit
Liquidity/ credit exposures with credit and operational losses remain low. Cost
Treasury large retailers, redemption processes and controls. of living pressures
Management partners, and other Retailers and counterparties may impact our retailers,
Trend = counterparties; in the are subject to ongoing which may increase the
Stable event of a default, credit reviews, and default rate. However,
Appetite significant financial effective debt management we have robust monitoring
= Low loss may result, as processes are implemented. and an increase in support
demonstrated with the Residual risk associated payment processing in
McColl's collapse. with potential default place to reduce default
We process large volumes of gift card providers rates and impacts.
of payments daily, therefore is mitigated through The risk profile of
effective operational insurance. Settlement our business operations
controls are essential systems and controls remains stable. We continue
to ensure funds are are continually assessed to review and enhance
settled accurately, and enhanced with new our operational processes
securely and promptly. systems and technology. and controls, and relationships
We have a number of We have effective governance with our funding partners.
debt / banking covenants with oversight committees, We successfully refinanced
and interest expenses delegated authorities to support the acquisition
which must be managed and policies for key of Appreciate and our
carefully. processes. Segregation cash generation remains
Absent or ineffective of duties and approvals robust.
controls in these processes are implemented for
could all areas where fraud
result in fraud, liquidity or material error may
risk, reputational damage occur.
or other
financial loss.
--------------- ---------------------------------- ---------------------------------- --------------------------------
10 Operational Successful delivery The Executive Board Risk is stable. The
Delivery of key initiatives and has overall responsibility Appreciate acquisition
Trend = strategic objectives for delivering key initiatives will require considerable
Stable is central to achieving implementing a robust management time and
Appetite our day-to-day and transformation control framework over effort to integrate.
= Low aims. Successful operational BAU activities. The combined group is
delivery Our project management now large enough to
depends on effective methodology ensures qualify for the SAO
forecasting, planning projects are prioritised regime, which means
and well controlled and governed effectively. the risk and control
execution both within Our existing documentation must be
the Group and in its processes are continuously reviewed and brought
supplier chain. Failure reviewed to make sure in line with HMRC requirements.
to manage this risk they There have been a number
would hamper our business are efficient and well of new products in the
performance, impact controlled. year, e.g. EBSS and
our stakeholders, and Open Banking, which
lead to regulatory or have been challenging
legal sanctions. and demanded prioritisation
of resources.
--------------- ---------------------------------- ---------------------------------- --------------------------------
Emerging Risks
-----------------------------------------------------------------------------------------------------------------------------
11 ESG and Focus on environmental, The CEO and the Executive Our ESG working group
Climate social and governance Board have overall accountability has implemented various
Trend = matters continues to for PayPoint's climate measures as we embed
Stable increase, and our business and social responsibility low carbon strategies
Appetite needs to be environmentally agendas, and they recommend into our working practices
= Medium responsible to create strategy to the Board. and business strategy.
shared value for PayPoint aligns its We will be rolling out
all stakeholders. business with reducing our new PayPoint terminal,
Climate risk is a key carbon emissions, and which generates lower
priority for governments continually assesses emissions than previous
and organisations globally, its approach to environmental models. We are moving
and PayPoint needs to risk and social responsibility, toward electric cars
play its part in reducing which are embedded in for our company fleet
carbon emissions and our decision-making and helping our field
its environmental impact. processes. We have multiple team to travel in more
Approximately 17% of policies and processes environmentally friendly
our revenue is derived governing our social ways.
from energy and fuel responsibility strategy We run an employee forum
markets and as the UK and we continually assess and have implemented
transitions to Net-zero and evolve our strategy various measures as
carbon emission economy and working practices a result, such as cost
by 2050, we need to to ensure the best outcomes of living support. Love2shop
closely monitor the for stakeholders and was named one of the
impacts on our business the environment. UK's best places to
to ensure our revenue work in April 2023.
streams remain sustainable.
--------------- ---------------------------------- ---------------------------------- --------------------------------
RESPONSIBILITY STATEMENT
We confirm that to the best of our knowledge this set of interim
financial statements has been prepared in accordance with IAS 34
Interim Financial Reporting as contained in UK-adopted IFRS and the
Disclosure Guidance and Transparency Rules sourcebook of the United
Kingdom's Financial Conduct Authority and that the interim
management report includes a fair review of the information
required by DTR 4.2.7 (indication of important events during the
first half and description of principal risks and uncertainties for
the remaining half of the year) and DTR 4.2.8 (disclosure of
related parties' transactions and changes therein).
Nick Wiles Rob Harding
Chief Executive Finance Director
INDEPENT REVIEW REPORT TO PAYPOINT PLC
Report on the condensed consolidated interim financial
statements
Our conclusion
We have reviewed PayPoint PLC's condensed consolidated interim
financial statements (the "interim financial statements") in the
Results for the half year ended 30 September 2023 of PayPoint PLC
for the period from 1 April 2023 to 30 September 2023 (the
"period").
Based on our review, nothing has come to our attention that
causes us to believe that the interim financial statements are not
prepared, in all material respects, in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting'
and the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority.
The interim financial statements comprise:
-- the Condensed Consolidated Statement of Financial Position as at
30 September 2023;
-- the Condensed Consolidated Statement of Profit or Loss and Condensed
Consolidated Statement of Comprehensive Income for the period then ended;
-- the Condensed Consolidated Statement of Changes in Equity for the period
then ended;
-- the Condensed Consolidated Statement of Cash Flows for the period then
ended; and
-- the explanatory notes to the interim financial statements.
The interim financial statements included in the Results for the
half year ended 30 September 2023 of Paypoint PLC have been
prepared in accordance with UK adopted International Accounting
Standard 34, 'Interim Financial Reporting' and the Disclosure
Guidance and Transparency Rules sourcebook of the United Kingdom's
Financial Conduct Authority.
Basis for conclusion
We conducted our review in accordance with International
Standard on Review Engagements (UK) 2410, 'Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity' issued by the Financial Reporting Council for use in the
United Kingdom ("ISRE (UK) 2410"). A review of interim financial
information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying
analytical and other review procedures.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK) and,
consequently, does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
We have read the other information contained in the Results for
the half year ended 30 September 2023 and considered whether it
contains any apparent misstatements or material inconsistencies
with the information in the interim financial statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than
those performed in an audit as described in the Basis for
conclusion section of this report, nothing has come to our
attention to suggest that the directors have inappropriately
adopted the going concern basis of accounting or that the directors
have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on
the review procedures performed in accordance with ISRE (UK) 2410.
However, future events or conditions may cause the group to cease
to continue as a going concern.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the directors
The Results for the half year ended 30 September 2023, including
the interim financial statements, is the responsibility of, and has
been approved by the directors. The directors are responsible for
preparing the Results for the half year ended 30 September 2023 in
accordance with the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority. In
preparing the Results for the half year ended 30 September 2023,
including the interim financial statements, the directors are
responsible for assessing the group's ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
directors either intend to liquidate the group or to cease
operations, or have no realistic alternative but to do so.
Our responsibility is to express a conclusion on the interim
financial statements in the Results for the half year ended 30
September 2023 based on our review. Our conclusion, including our
Conclusions relating to going concern, is based on procedures that
are less extensive than audit procedures, as described in the Basis
for conclusion paragraph of this report. This report, including the
conclusion, has been prepared for and only for the company for the
purpose of complying with the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom's Financial Conduct
Authority and for no other purpose. We do not, in giving this
conclusion, accept or assume responsibility for any other purpose
or to any other person to whom this report is shown or into whose
hands it may come save where expressly agreed by our prior consent
in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
Watford
22 November 2023
(1) Net revenue is an alternative performance measure. Refer to
note 4 to the financial information for a reconciliation to
revenue.
(2) Underlying EBITDA (EBITDA excluding adjusting items) is an
alternative performance measure. Refer to note 1 to the financial
information for the definition and the Financial review for a
reconciliation to profit before tax.
(3) Underlying profit before tax (profit before tax excluding
adjusting items) is an alternative performance measure. Refer to
note 1 to the financial information for a reconciliation.
(4) Cash generation is an alternative performance measure. Refer
to the Financial review -- cash flow and liquidity for a
reconciliation to profit before tax
(5) Net corporate debt (excluding IFRS 16 liabilities) is an
alternative performance measure. Refer to note 1 to the financial
statements for a reconciliation to cash and cash equivalents
(6) Adjusting items comprises exceptional items and amortisation
of intangible assets arising on acquisition. Refer to note 1 for a
reconciliation.
7 Adjusted EBITDA is an alternative performance measure. Refer
the finance review for a reconciliation.
(8) Net corporate debt (excluding IFRS 16 liabilities) is an
alternative performance measure. Refer to note 1 to the financial
information for a reconciliation to cash and cash equivalents.
(9) Dividend cover represents profit after tax divided by
reported dividends.
Attachment
-- H1 FY24 RNS - Final (004)
https://ml-eu.globenewswire.com/Resource/Download/ad59579f-7a69-4fca-992f-b85cad90726e
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November 23, 2023 02:00 ET (07:00 GMT)
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