REG-FY26 Update, Business Reorganisation and FY27 Outlook

PayPointAnnouncement

Today 07:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20260330:nGNE92ybww&default-theme=true


PayPoint Plc 
30 March 2026
FY26 Update, Business Reorganisation and FY27 Outlook

FY26 Update

PayPoint Plc (“PayPoint” or the “Group”) today issues an unaudited
trading update for the financial year ended 31 March 2026.

The Group anticipates it will deliver a record financial performance for FY26,
broadly in line with expectations. Consistent with the extended and increased
buyback programme announced on 1 July 2025, as of market close on 25 March
2026, a total of 3,957,613 shares have been purchased at a total value of
£23.8 million. The Group remains on course to reduce its issued share capital
by circa 30% in the three years to FY28 while continuing to grow the ordinary
dividend, with share capital already reduced by circa15% in the current year.

Business Reorganisation

The Board also today announces that it has taken the decision to simplify the
business through a reorganisation into four business units: Network Services,
Digital Payments and Open Banking, Love2shop and Merchant Services. This will
result in a better integrated and more transparent business with a simpler
investment case.

This reorganisation will establish four business units of scale, with clearly
defined operating structures, a greater focus on growth opportunities with a
more accountable operating culture. This will enable a more focused portfolio
of businesses and lead to a better harnessing of the Group’s collective
capabilities, strengthen execution and go-to-market strategy with better
defined areas of co-operation, cost savings, synergy and opportunity between
business units to drive growth. Consistent with this reorganisation is a
fundamental review of the Group cost base which will lead to an unlocking of
cost savings and enable reallocation of investment with a renewed focus on
driving enhanced shareholder returns.

The Group has made significant progress on its transformation journey over the
past five years, assembling additional capabilities and opening up a range of
new opportunities. The next stage now is to convert these gains into
meaningful and sustained growth through strong operational delivery –
realising the full potential of the Group.

Consistent with the more transparent and accountable operating culture
underpinning this reorganisation, each of the four business units will have
clearly defined financial metrics and KPIs. The Group will also provide
investors with enhanced insight from the wealth of data available particularly
with respect to Network Services. Further details will be provided at the
preliminary results in June 2026.

The four business units will be:

1.   Network Services (estimated FY26 net revenue: £91.3 million)

The reorganisation will enable Network Services to better support our UK-wide
estate of over 30,000 convenience stores, delivering key essential community
services and enabling stronger performance through better compliance, improved
service delivery and adoption of the full range of PayPoint services.

Today, PayPoint operates the leading UK network delivering essential community
services, including cash bill payments and government services, an open parcel
carrier collect and drop off network (branded as Royal Mail Shops and
Collect+), local cash banking for both consumers and, in future, small and
medium-sized enterprises (SMEs), and top ups for a wide range of digital and
physical gift cards and experiences.

Having established the highest quality and most comprehensive network in the
UK, our future strategy will be to drive network performance through better
store compliance and service delivery, driving higher consumer footfall and
adoption of the full range of PayPoint services across our retailer estate.
This will reduce the emphasis on estate growth and place a greater focus on
network performance and services adoption.

To achieve this, the Network Services unit will move to a unified,
geographically aligned operating model to enhance estate quality, strengthen
commercial and operational consistency and deliver material efficiency
savings. The business will be organised into Field Services and a Retail
Service Hub, operating in a truly integrated structure across four
geographical regions. This will deliver clearer ownership, improved
coordination between field and hub, and a more efficient operating model. This
approach will underpin a ‘growing retailer value’ strategy focused on
increasing revenue per store, improving compliance, widening product
penetration and strengthening retailer capability, supported by increasingly
sophisticated data analytics.

2.   Digital Payments and Open Banking (estimated FY26 net revenue: £13.4
million)

The reorganisation will bring together PayPoint’s Digital Payments, Open
Banking and real-time credit bureau capabilities under a single management and
operating structure. This will create a more coherent platform for product
development, accelerate new business wins and support closer integration
across the Group.

Today, the Digital Payments and Open Banking business is a technology-led
suite of complementary services consisting of:
* Digital payments platform – enabling secure payment and funds disbursement
journeys for major organisations across housing, government, utilities and
financial services with multiple payment methods (Open Banking, cards, direct
debit and cash) and with multiple channels (web, app, voice, messaging and
embedded/API).
* SaaS data-sharing platform – providing a secure and resilient network for
national operators, regulated firms and corporates for Open Banking,
Confirmation of Payee and other open data sharing initiatives. This technology
powers GetVerified’s CoP ecosystem in New Zealand and has enabled over 50
organisations to participate in Open Banking, CoP and VoP in the UK, Europe
and New Zealand.
* Real-time credit reference and transaction analytics – powered by Open
Banking and AI, to deliver instant high-quality credit, lending and
vulnerability assessments for regulated firms. 
A unified business structure will better enable the future development of
these products and an acceleration of new business growth, through
cross-selling into the existing PayPoint client base, leveraging frameworks
such as the Crown Commercial Service and both scaling and integrating
obconnect into the PayPoint business, while retaining and deepening
relationships with an extensive payment services client portfolio.

3.   Love2shop (estimated FY26 net revenue: £53.2 million)

Since acquisition in 2023, the Love2shop leadership team has made considerable
progress in upgrading and enhancing the technology platform and its product
capabilities, broadening the Love2shop product distribution channels and
delivering an improved financial performance from a refined commercial model,
delivering an improving blended margin through maximising the lifetime value
of billings from each channel. Love2shop offers consumers and corporates the
widest choice of both digital and physical gift card products and the largest
range of redemption partners.

Love2shop is now the UK-leading rewards, engagement and prepaid savings
platform, serving corporates, public sector organisations and consumers with
the widest range of multi-retailer gift cards and vouchers in both digital and
physical formats. Its services support employee reward and recognition,
customer acquisition and government support programs, as well as
direct-to-consumer gifting and savings solutions.

The reorganisation will enable an improved focus on new business growth and on
maximising opportunities across Love2shop’s distribution channels. Continued
investment in our technology platform, ongoing product enhancement and
leveraging AI to improve marketing insight will strengthen our go-to-market
strategy and support accelerated new business growth across Love2shop
Business, the expansion of our prepaid savings proposition and growth of our
consumer channels, including through our Incomm Payments partnership. There
also remain significant opportunities to integrate Love2shop more efficiently
across the wider PayPoint Group and client base.

4.   Merchant Services (estimated FY26 net revenue: £31.5 million)

The reorganisation will drive a fundamental reset of the strategy and
organisational structure of the Merchant Services business.

Today, the business delivers in-store and online card acquiring, terminal
rental and business finance solutions to more than 30,000 UK SMEs across the
PayPoint and Handepay estates, supporting around 10,000 retailers within the
PayPoint network and a further 20,000 through Handepay.

In the merchant card acquiring business, our strategy needs to adapt and
respond to the changes in a highly competitive card processing market. The
business has a strong merchant network, and a fundamental action in the
business reset will be to make the investment required to deliver better
merchant support and significantly improve merchant retention. Plans are
already underway to bring retention and estate management activities for the
entire estate into a single management structure. This will also require
further leverage and utilisation of our data analytics capability to better
anticipate merchant behaviours and support retention conversations.

In addition, we are planning a significant shift in our merchant acquiring new
business go-to-market strategy. In the PayPoint estate, we will continue to
target growth, with greater emphasis on supporting the onboarding and in life
management of the network, to ensure new PayPoint merchants become high
transacting and profitable additions to the estate. In Handepay, we will
refocus our future sales resource at growing in the higher value segment where
we believe our product and broader range of payment capabilities better
positions the business for longer term profitable growth. As a result, we will
stop targeting low value, high-churn merchants in a market segment that has
become increasingly competitive and purely price focused. This will also drive
a fundamental reorganisation of the current Handepay sales teams as we
introduce the necessary skills into the business to succeed in a mid-market
growth strategy.

Execution of this strategy shift will deliver a higher quality merchant
acquiring estate, a focus on net revenue, improved profitability and a
merchant estate managed for value rather than a focus on merchant estate
growth.

In Merchant Rentals, the leading provider of flexible financing and rental
options for payment terminals, we are targeting further growth driven by major
partnerships with FreedomPay and Lloyds Bank. In particular, the new agreement
with FreedomPay, signed in December 2025, underscores Merchant Rentals’
commitment to supporting introducers and their clients with innovative
financing solutions. The partnership is already delivering positive results,
with the first joint client now live across more than 1,000 terminals. This
relationship represents significant growth for Merchant Rentals and reinforces
its position as a trusted provider of flexible payment technology solutions.

In Business Finance, delivered in partnership with YouLend, we continue to
deliver strong results with over £28 million in funding provided to
businesses over the past year and strong growth demonstrated across the
PayPoint and Handepay estates. Plans are well underway to continue this
momentum and grow further in FY27.

FY27 Outlook

The business reorganisation will drive significant change in the Group during
FY27 and beyond. The actions we are taking to simplify and optimise the
business structure will better position PayPoint to prioritise resources and
focus towards areas which will deliver growth for the long term despite
structural change in a number of our key markets and a slower than expected
pace in the roll out of some of our key growth initiatives. The Board believes
these actions are fundamental to the next steps in the development of the
PayPoint business and will establish a stronger foundation for future growth.

Entering into the new financial year, in a challenging trading environment,
our business reorganisation will ensure there are a number of important
changes in priority and emphasis across the business. At a headline level, the
focus across each of our four business units and their respective channels to
market is to harness our capabilities to deliver a higher quality of earnings
and greater adoption of our products and services.

In terms of trading, our outlook for the year ahead is balanced between the
continued growth across the Group, further cost efficiency initiatives and
recent trends in certain of our business units, in particular our parcels
business. Overall, this indicates the business is likely to exceed the
underlying profits delivered in FY26 and within the range of market
expectations.

Capital allocation policy

The Board believes the current capital allocation and dividend policies
continue to be appropriate and key elements to the value proposition for
shareholders. In FY26, in total through a combination of share buybacks,
ordinary and special dividends, the Group will have returned more than £90
million in value to shareholders in the year. The business remains on course
to reduce its issued share capital by circa 30% in the three years to FY28
while continuing to grow the ordinary dividend, with share capital already
reduced by c.15% in the current year.

FY26 preliminary results and Capital Markets Day

PayPoint Plc’s preliminary results for the financial year ended 31 March
2026 will be announced on 11 June 2026, along with further detail on the
business reorganization, the Group’s strategy and medium-term outlook for
the new business units. This will be ahead of a Capital Markets Day planned
for September 2026.

 Enquiries                                                                                         
                                                                                                   
 PayPoint plc                                                 FGS Global                           
 Nick Wiles, Chief Executive (Mobile: 07442 968960)           Rollo Head                           
 Rob Harding, Chief Financial Officer (Mobile: 07525 707970)  James Thompson                       
                                                              (Telephone: 0207 251 3801)           
                                                              (Email: PayPoint-LON@fgsglobal.com)  



Attachment
*     FY26 Update Reorganisation and FY27 Outlook - 27 March
(https://ml-eu.globenewswire.com/Resource/Download/29a933aa-189d-4804-b295-1dbda236e388)