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PayPoint PLC on Thursday reported a decrease in its interim profit, as it grappled with ‘two challenges’ during the period, though revenue increased. Shares in PayPoint dropped 17% to 538.75 pence on Thursday morning in London. The Hertfordshire, England-based payments and retail technology group said for the six months ended September 30, pretax profit fell 14% to £19.9 million from £23.1 million. This included an increase of £1.7 million in current period Obconnect costs, from none last year. There were also increases in cost of sales, reflecting the increase in revenue, and in finance costs. Obconnect is an open banking provider. Underlying pretax profit fell 4.5% to £25.7 million from £26.9 million a year ago. Total revenue rose 6.7% to £144.1 million from £135.0 million. PayPoint noted a 9.6% drop in revenue for the Love2shop segment, which fell to £17.0 million from £18.8 million. Love2shop’s decline was offset by growth in the PayPoint segment. Revenue for the PayPoint unit grew 2.9% to £67.7 million from £65.8 million. PayPoint attributed Love2shop’s revenue decrease to changes to the timing of revenue recognition for expiry of cards. ‘Proactive management of this change ahead of the current financial year will result in a stronger H2 performance as card expiries lead to a greater weighting in the second half of the current year,’ the company said. Chief Executive Nick Wiles said: ‘As the current year has progressed, we have faced two challenges: firstly, the impact from the disruption to our parcels network from the harmonisation of InPost and Yodel services combined with the commercial terms of our new 3-year contract has been greater than we had anticipated, and secondly, while Obconnect continues to build its new business pipeline and range of opportunities, the pace of growth and monetising of these opportunities in year is slower than we had planned.’ The company declared an interim dividend of 19.8p per share, up 2.1% from 19.4p in the prior year. Looking ahead, PayPoint said it expects underlying earnings before interest, taxes, depreciation, and amortisation for financial 2026 to be ahead of last year and ‘broadly in line with current market expectations’. For the next three years to the end of financial 2028, the company also said it aims to achieve net revenue growth in the range of 5% to 8% per year, establish an organisational framework and deliver a reduction of at least 20% of its issued share capital. CEO Wiles added: ‘We have continued to build on an encouraging start to the year and in the first half we have reached important milestones in the delivery of major projects key to our long-term growth plans. Against the background of a generally weak economy and some specific business challenges, we remain confident in delivering further progress in the current year.’ ‘Consumer uncertainty and tightening household budgets are not new factors as we enter the peak trading period for several of our businesses.’ Copyright 2025 Alliance News Ltd. All Rights Reserved.
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