BPS Technology meets prospectus forecasts

BPS Technology, the operator of the Bartercard system, has beaten prospectus forecasts in its first financial report since listing on the Australian Securities Exchange last September.

The company reported revenue of A$24.9 million for the six months to December, compared with a prospects forecast of $24.7 million.

Net profit for the period was $3.3 million, compared with a prospectus forecast of $2.9 million.

BPS claims that Bartercard is the world's biggest barter trade exchange, processing more than $600 million in transactions each year.

The business is structured around local trade exchanges. Bartercard has 20 trade exchanges in Australia - half owned by the company and half franchised. In the US it has 15 franchises, with around 500 members in each.

Proceeds of the initial public offering went to acquire Bartercard New Zealand, which had a separate group of owners.

BPS Technology's prospectus outlined plans to increase the number of Bartercard cardholders from 54,000 today to 100,000 by the end of 2016.

In January the company signed a licensing agreement to introduce Bartercard in China.

During the December half, 68 per cent of revenue came from the Australian operation, 23 per cent from New Zealand, eight per cent from the United Kingdom and a little under one per cent from the United States.

Bartercard's business proposition is that a trade exchange provides merchants with an additional sales channel. Typically, members use Bartercard to trade excess goods and services, using it as an alternative to mass discounting.

Transactions through a Bartercard trade exchange usually account for about five per cent of a member's turnover and the average member trade is $25,000 a year.