Cash may be king, but there are a dozen other ways to pay these days and PayPoint (PAY) is doing its best to keep up. The business began life as a network of bill payment terminals in convenience stores. Bill payments still account for just over half of all the transactions that PayPoint processes, but these days the best of the growth lies in the mobile and online business.
PayPoint's mobile and online transactions - such as paying for parking on a mobile phone or for an online purchase - rose 16 per cent last year. PayPoint's Collect+ joint venture with delivery company Yodel is another hot spot. Collect+ allows shoppers to buy a product online and have it delivered to a convenient point near their home, such as a local petrol station. It's certainly proving popular, with transaction volumes up 76 per cent.
Management said PayPoint has more than 250 retail brands signed up to Collect+, and a network of 5,600 pick-up collections. The ultimate aim is to get that up to 12,000, which would make the network larger than that of the Post Office.
Broker JPMorgan Cazenove expects adjusted earnings per share of 56.7p this year (52.6p in 2013-14).
| PAYPOINT (PAY) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,056p | MARKET VALUE: | £717m | |
| TOUCH: | 1,055-1,057p | 12-MONTH HIGH: | 1,218p | LOW: 902p |
| DIVIDEND YIELD: | 3.3% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 153p* | NET CASH: | £42m | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 197 | 32.6 | 32.9 | 21.8 |
| 2011 | 193 | 34.5 | 35.2 | 23.4 |
| 2012 | 200 | 37.2 | 39.8 | 26.5 |
| 2013 | 209 | 41.3 | 45.7 | 30.4** |
| 2014 | 212 | 46.0 | 52.9 | 35.3 |
| % change | +2 | +11 | +16 | +16 |
Ex-div: 25 Jun Payment: 24 Jul *Includes intangible assets of £64m, or 94p a share **Excludes special dividend of 15p | ||||
