PayPoint Group has delivered another positive quarter, with robust performance across its key seasonal businesses, reinforcing its confidence in meeting FY25 expectations and achieving its ambitious target of £100 million EBITDA by the end of FY26.
In a trading update for the three months ended 31 December 2024, the group reported a 1.9 per cent increase in net revenue to £53.0 million, driven by strong performances in its e-commerce and Love2shop divisions.
“Our business has continued to deliver further progress in the third quarter building on our strong first half year performance, despite a more challenging overall trading environment and a stalled recovery in consumer confidence,” Nick Wiles, chief executive of PayPoint Plc, said.
“During the period, our seasonal businesses in particular have performed well and, for the business as a whole, the board remains confident in the delivery of further progress in the year and meeting expectations.”
In the shopping division, retail services net revenue increased by 1.9 per cent to £8.2 million driven by further PayPoint One/Mini site growth. However, card payment revenues declined by 5.7 per cent to £7.8 million, reflecting lower consumer spending and a challenging environment for UK consumers.
Overall, shopping divisional net revenue decreased by 2.0 per cent to £16.1 million.
The e-commerce division delivered a record quarter, with parcel transaction volumes up 36.8 per cent to 35.8 million, driven by the growing popularity of its Collect+ network for out-of-home fulfilment. The division’s net revenue increased by 32.0 per cent to £4.1 million. PayPoint’s partnership with Royal Mail has also gained momentum, with plans to expand the number of Royal Mail sites and volumes. Additionally, the goup is making strides in engaging with Chinese and South Asian marketplaces, with services expected to go live in the final quarter.
“We will be starting a number of initiatives through our network with SF Express in Q4, the leading integrated logistics service provider with an extensive PUDO network in China, focused on enabling our services in Chinese communities across the UK,” Wiles said.
In the payments & banking division, net revenue grew by 0.8 per cent to £14.0 million, supported by the continued expansion of the MultiPay platform and Open Banking services. PayPoint also completed the majority ownership of obconnect in October 2024, which is expected to contribute modestly in the second half of the year.
The Love2shop division saw a 1.3 per cent increase in net revenue to £18.8 million, with billings reaching £71.2 million, up from £66.8 million in the same period last year. The division’s strategic partnership with InComm Payments has driven significant growth, with Love2shop gift card sales increasing by 69 per cent year-on-year. Park Christmas Savings also delivered a solid performance, with billings of £162.2 million, consistent with the previous year.
Reflecting the group’s strong performance, the board declared an increased interim dividend of 19.4 pence per share, up 2.1 per cent from the previous half-year.
“As we continue towards delivering £100m EBITDA by the end of FY26, our confidence in our business resilience and growth is underpinned by the breadth of opportunities across all of our divisions and maintaining the right organisational structure and cost base to support the delivery of our growth plans,” Wiles concluded.
