Shares in fee-charging cash machine operator Cardpoint have plummeted after the company said its short term profits would be hit by underperforming Moneybox ATMs.
Cardpoint shares were down 43% to 72 pence in mid-afternoon trading after the firm said it would remove around 1000 poor-performing Moneybox ATMs from its estate, some of which will be redeployed in more profitable sites. This will cause a delay in implementation of new sites that will affect the firm's short-term profits.
Furthermore, Cardpoint says while integrating the Moneybox business, which it acquired in August, it has had to process a "significant level of accounting and fair value adjustments" which have reduced the net assets of the unit by £5.9m.
The news comes as the group reports widening losses of £11.5m for the year ending 30 September 2005, from £3.1m in 2004. The company says the increased losses are due to higher goodwill charges, £9.3m of which relate to its purchase of ATMs from HBOS, while £2.9m relates to Moneybox for the period following its acquisition of the business.
Despite this the firm is reporting a 66% increase in turnover for the year, which rose to £61.1m, compared to £36.8m a year ago. Ebitda is up 98% to £8.9m, from £4.5m in 2004, while profit before tax, goodwill amortisation and charges for share based payments, excluding Moneybox, increased by 93% to £3.6m, from £1.9m in 2004.