PAY - Finals & KGF - Q1

Having mentioned Paypoint (PAY) yesterday I thought I should touch on their results today which seem fine. The net revenue came in roughly in line at £113.7 million (+7.7%) v £115 million (F), eps were ahead at 52.6 pence (+16.1`%) v 51 pence (F), while there was a nice beat on the dividend which came in at 35.3 pence (+16.1%) v 33.3 pence (F). They said this increase reflected their confidence in the business.

So some growth in their payment business and expansion in Eastern Europe (Romania) is on going. Meanwhile the Collect+ (Parcel collections from shops) saw transactions up over 76% and is now apparently profitable so will no longer be a drag on profits. So overall it seems OK as they continue to invest in and develop their multi channel payment capabilities (mobile, on line and retail) + click and collect delivery network. They also mentioned that some extra days in last years numbers reduced reported growth metrics by 1% to 3%.
I was sorry to see that David Newlands is retiring but he seems to be leaving it in good shape. So although it seems fine it is one I'll probably continue to watch for now as I cannot bring myself to pay up for it.

I wrote Kingfisher up earlier in the year having got into it as a way of playing the recovering housing market, click the link above for more in depth details. Their trading update today looks good, especially in the UK, which seems to support my thinking on this one. However, France remains weak and they do flag that the numbers were flattered by a very weak comparative from last year. They suggest these comparatives will become harder from now on and that Q1 is generally a quiet quarter any way - so not too much to get excited about there.

On a more positive note they did confirm a special dividend payment of 4.2 pence to return £100 million on top of the £35 million of share buy backs they have done already as part of their £200 million capital return programme for 2014/15, which is part of a multi year programme. So all seemed OK to me but Mr. Market seems underwhelmed by them as he has marked them down by about 5 to 6% this morning - but as a French DIY customer would say c'est Le vie and au re voir.

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