Bango, the Cambridge-based mobile web payments and analytics company, has posted final results which show evidence of growing traction for its services in the smartphone market.

It looks an astute decision by management to have transitioned in the year to focus on the smartphone, rather than the featurephone, market.

The company has revealed strong progress with its BlackBerry relationship and says it is on track to announce a second App Store contract by the end of June.

Bango is confident it will accelerate its growth in the coming months. Bango payment technology will soon appear in new markets such as Indonesia, Mexico and the Middle East – markets where mobile content is a passion for the young mobile customer base.

The preliminary results for the year to March 31 show a pick-up in business in the second half, with improvement in gross profit to £1.29m (H1 £1.21m).

Revenues were well down – from £26.1m to £19.3m – as Bango switched focus and a post-tax profit of £0.1m last year morphed into a £0.7m loss. Bango reported a cash balance only slightly down at £2.71m (£2.74m).

CEO Ray Anderson said: “The key development during the year was the decision to focus on the fast growing smartphone market segment, developing relationships with App Stores as a way of deploying Bango technology more widely.

“Bango’s agreement with RIM to provide carrier billing for BlackBerry App World, announced in the first half, is potentially transformational and resources have been re-allocated to ensure the success of the project.

“Bango is now developing a number of other significant App Store opportunities including those focused on the increasingly popular Android platform.

“As expected, the continued decline in end user spending on low-margin content for featurephones reduced gross profit from that part of the business. However, good progress in growing smartphone payment and analytics business resulted in an overall growth in gross margin in the second half.

“The second half showed an underlying profit after allowing for one-time costs related to the acceleration of cost reduction in the featurephone business and a change in recognition of gross profit on mobile operator integrations.

“Since the year end, the number of mobile operators activated for RIM has doubled and in May overall end user spending grew compared with April. Progress with RIM and other App Stores in the pipeline gives us confidence that we are well placed to accelerate this growth in future periods.”

During the second half, Bango connected and commissioned many new carriers, both in its pool of existing connections, such as Vodafone UK and T-Mobile USA and new connections and a small number of these were active at the year end.

The continued growth of the Android market promises to be a significant driver of growth for Bango. Canalys reported that in Q4 2010, Android powered smartphones became the fastest selling with 33 per cent share of smartphone shipments – ahead of Nokia (31 per cent) iPhone (16 per cent) and BlackBerry (14 per cent).

Google provides an App Store – Android Market for Android – but there are other App Stores being developed to target the fast growing Android user base. iPhone users are restricted by Apple in their choice of content and apps and how they can be marketed and sold, but Android enables much more choice and innovation.