Cash machine group profits soar

THE UK‘s biggest independent operator of cash point machines today rushed to reassure bank customers that it will still be possible to take their own money out of their accounts for free.

But Cardpoint‘s promise was hedged with provisos and it admitted that it will retain only 'some' machines for free as long as they can be operated profitably.

Cardpoint acquired 816 high transacting machines from HBOS in June as part of a £40m deal which made it the UK market leader by number of fully managed cash machines. It now operates 2,800 machines at petrol stations, in stores, railway stations and at leisure outlets.

Today the company announced a sharp rise in full-year profits, well ahead of expectations. Its shares picked up almost 6p at 115p on the results.

Chief executive Mark Mills said the migration of HBOS machines to Cardpoint‘s operational platform was on track and most will be converted to a charging system.

'It was always anticipated that not all of these machines would be immediately converted to the charging model and, once the non-charging machines are operating profitably, there is a further opportunity to convert these machines to the charging model with the benefit of further improved profitability.'

Cardpoint has signed contracts with several key customers in whose premises it sites cash machines – these include Road Chef, Welcome Break and First Motorway Services.

Cardpoint's German business now has 30 cash machines live, each earning on average more than €3.50 per withdrawal.

Turnover for the year of £36.8m represents a 203% increase on last year‘s £12.2m. Pre-tax profit was £1.8m, compared with £50,000 in 2003. Capital expenditure rose more than 50% from £2.1m to £3.3m, most of it due to equipment upgrades required for Chip and Pin technology and security improvements.