Allpay, a highly profitable British PSP focused on the public sector, has reported excellent results with turnover up 21% to £48.7m in year ending June 2023. Operating margin rose to a very creditable 16%.
The business was founded by Tony Killeen in 1994. Although the idea for Allpay came to him while he was working for Hereford Council. Killeen believes his time spent in the armed forces provided him with the discipline to run his own business.
Along with Pay360 (recently sold by Capita to Access Group), Allpay is one of a small number of specialist providers of bill payment solutions to the UK public sector. This includes direct debits, card payments, debt collection tools, a white label app and the ability to accept cash payments via the Paypoint, Payzone and Post Office retail networks. Allpay boasts more than 500 housing associations and one third of British local authorities as clients.
Allpay also has a growing business supplying pay-out products which allow authorities to distribute benefit payments directly to low-income families, often onto one of Allpay’s pre-pay Mastercard’s. During the cost-of-living crisis, more people have been relying on state assistance of various kinds and Allpay reported a record £37.5m loaded to its cards in March 2023. These cards can include MCC and ATM blocking as well as spend limits that give public sector bodies more control on what money is spent on.
Allpay manufactures cards for itself and others and has invested £1.5m into new production technology.
Prepay is fast becoming an excellent business line for Allpay. Revenue from pre-pay and other services grew 72% to £10.3m. Turnover from the much larger bill payment segment was up 12% at £38.4m.
Cost of sales rose just 2% resulting in gross profits increasing 47% to £25m.
Administrative expenses were up 28% to £17m including £11m of staff costs. Employee numbers rose 6% to 271 at an average cost up just 5% at £40K. Allpay is based in rural Herefordshire and less impacted by the high and rising pay costs hitting Fintech providers in London.
Operating profit more than doubled to £8m with margins rising to a very creditable 16.3% compared to 9.4% in 2022.
Allpay is growing nicely, has a blue-chip customer list, maintains a positive cash flow, is largely debt-free and pays a consistent dividend to its owners. With Killeen now 67 years old and still the sole owner of the company, Allpay must be an attractive acquisition target for private equity or trade buyers.
