The rollout of the PayPoint One EPoS system is driving revenue growth for the company, according to its latest quarterly results.
In the three months ending 31 December 2019, net revenue grew by 4.2%. This was led by service fees – the amounts charged to stores for its services, rising by nearly a third compared to the same quarter in 2018. PayPoint said this was due to growth in the PayPoint One network, with 1,135 stores signing up for the service in the last three months.
The service fee revenue growth also comes from an increase in the average weekly fee paid per store. This rose from £14.89 to £15.38 as more stores opted for its premium PayPoint One Pro product.
Despite the rise in PayPoint One deployments to 16,223 sites, the overall size of PayPoint’s network shrank by 534 sites to 27,832, which it said was due to retailers opting to lose all PayPoint services rather than upgrade. Meanwhile, rivals Payzone claimed it is adding new retail sites ‘almost every day.’
In the parcel click and collect market, volumes through partnered stores rose 12.6% overall and 15% in December. PayPoint said this was a ‘solid performance’ but admitted the rise was ‘towards the lower end of our expectations.’
Bill payments were up 2.2% which PayPoint credited to strong growth in its digital and in-store payments service – MultiPay. However, transaction volumes continued to fall and the long-term decline of mobile top-ups in store cut top-up and eMoney revenues by 3%.
Discussing the start of 2020 for bill payments, the company made no reference to the loss of its largest utilities partner – British Gas and instead hinted an energy transaction slowdown on ‘warmer weather.’
PayPoint executive chairman Nick Wiles said the latest results show: “Resilience in our bill payments business, growth in our parcels activities during the important peak parcels period and continued progress in the rollout of PayPoint One and our retail services activities.”
The quarter also saw chief executive Patrick Headon step down from his role in December citing an ongoing medical condition. A replacement is yet to be announced.