Hole-in-the-wall firm raises charges

CASH machines company Scott Tod has increased the amount it charges customers to withdraw their money after its network of ATMs failed to perform as well as expected.

Fees for taking out cash have risen from £1.50 to £1.75 at the company's 2,600-plus hole-in-the-wall machines, which it said put it in line with the rest of the industry.

The shares fell 13% after the announcement, which came as the group revealed profits before tax and goodwill rose to £56,000 in the six months to 31 December from £38,000 last year. Turnover increased to £5.6m from £875,000.

The company, whose Scott Tod-branded machines are situated in pubs, concert venues and theme parks, started to raise charges about a month ago. News of the increase came two days before a report on cash machine charges from a committee of MPs, who have criticised the sector for charging customers.

The number of fee-charging machines has grown from zero in 1999 to almost 20,000 today - 40% of the UK's cash machine network. The cash machine companies have claimed before the Treasury Select Committee that they are providing choice for consumers who decide not to seek out free machines.

Scott Todd warned in January that results for the second half year would be below expectations. Today it said it had since concluded that a 'significant number' of machines were operating below the desired level. This was partly due to the seasonal nature of some locations.

The company also had difficulties with ATMs that it did not fully manage, as they were not always fully replenished with cash and were sometimes switched off. It will now focus on moving some machines to better, more profitable sites instead of rolling out new dispensers. It said its other two divisions - change machines and card vending - were performing in line with expectations.