REG - Fintel PLC - Trading Update, Completion and Notice of Results

FintelAnnouncement

30/01/2025 07:00

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RNS Number : 1870V  Fintel PLC  30 January 2025

30 January 2025

 

Fintel plc

 

("Fintel", the "Company", the "Business" or the "Group")

 

Year End Trading Update, Completion of Acquisition and Notice of Full Year
Results

 

Positive financial performance, significant strategic expansion

 

Fintel (AIM: FNTL), a leading provider of fintech and support services to the
UK retail financial services sector, today announces a trading update for the
year ended 31 December 2024, and the successful completion of the acquisition
of RSMR following regulatory approval.

 

Financial highlights

 

·      Positive performance and significant strategic progress with full
year results in line with Board expectations

·      Revenue increased 21% to £78.3m (FY23: £64.9m)

·      Core(1) revenue increased 22% to £68.9m (FY23: £56.6m),

·      Core SaaS & Subscription revenue up 17% to £44.1m (FY23:
£37.6m)

·      Adjusted EBITDA(2) growth of 8.5% to £22.2m (FY23: £20.5m),
following investment to expand products, services and capabilities

·      Strong balance sheet with £6.3m of cash, and £50m of headroom
in our £80m Revolving Credit Facility

·      Net debt position(3) of £23.7m (FY23: net cash of £1.7m),
representing comfortable leverage of 1.1x, following significant spend on
acquisitions and step up in investment

 

Financial performance - Revenue

Statutory revenue increased 21% to £78.3m (FY23: £64.9m) with the non-core
business performing in line with expectations delivering revenues of £9.4m
(FY23: £8.4m).

Core revenue increased to £68.9m (FY23: 56.6m), up 22%, supported by revenue
of £15m (FY23: £1.5m) from our acquired portfolio.

On a like-for-like(4) basis, core organic revenue increased by 2% (LfL: FY24:
£52.6m; FY23: £51.7m), stripping out the impact of acquisitions and the
gross-to-net recognition of the re-contracted software seller agreement.

 

Strategic and operational highlights

 

·      Significant growth in SaaS and subscription revenue in the core
business (up 17%)

·      Four strategic acquisitions and investments completed, supporting
our strategy of adding scale, IP and quality data sets to consolidate a
fragmented technology market

o  Threesixty Services - July 2024

o  ifaDASH - March 2024

o  Owen James - January 2024

o  Synaptic Software - January 2024

 

·      Focus on acquisition integration and delivering revenue
synergies, to drive medium term organic growth

·      New distribution agreement with Mortgage Brain, with its CRM,
sourcing and submission software available to Fintel's wide network of
advisers

·      Strengthening of intermediary proposition through access to
proprietary technology and services

·      Organic investment in technology and data propositions to expand
growth opportunity, including the release of Defaqto's Matrix 360 in January
2025

 

Regulatory approval received to complete acquisition of Rayner Spencer Mills
Research Limited

 

·      On 16 July 2024, the Company announced a conditional agreement to
acquire 70% of Rayner Spencer Mills Research Limited ("RSMR"), a UK-based
company specialising in providing independent investment research, ratings,
and support to financial advisers, investment professionals, and financial
services firms. The remaining 30%, owned by management, will be acquired over
the following 24 months, subject to price and performance.

·      Regulatory approval was granted in late December 2024, and the
acquisition was successfully completed on 7 January 2025, for an initial net
cash consideration of £5.2m. The expected EBITDA contribution for FY25 is
c.£0.5m.

 

Outlook

 

Fintel continues to drive growth through the expansion of new customers and
technology solutions within the UK Retail Financial Services market. The
recent acquisitions provide an excellent platform for growth, contributing
towards our strategic ambitions of inspiring better outcomes across the
market.

 

The backdrop for Fintel remains positive, underpinned by the dynamic
structural market shifts in UK financial services, including regulatory
requirements and demand for data and insights, as intermediaries and product
providers navigate an evolving market. This, together with our recent
acquisitions, positions Fintel strongly for sustained organic growth going
forward.

 

After assessing the financial impact of the increase in Employer's National
Insurance Contributions (NIC) announced in the budget, we have concluded that
the business will make the necessary steps to absorb the forecasted additional
cost of c.£0.65m for FY25, without negatively impacting earnings.

 

While we remain mindful of macroeconomic uncertainties, we are confident of
delivering further strategic progress in 2025, as we focus on ongoing
integration of recent acquisitions, realising further synergies and achieving
sustained organic growth.

 

Matt Timmins, Joint CEO of Fintel plc, said:

 

"2024 has been a year of continued strategic progress and positive financial
performance. The business has performed well, with complementary acquisitions
supporting significant growth in SaaS and subscription revenues.

 

"We have welcomed four new businesses to the Fintel family in 2024, with the
previously announced acquisition of RSMR also receiving regulatory approval in
December 2024. Through these strategic acquisitions and continued investment
in our unique technology and data propositions, we have successfully expanded
our IP, scale and reach, which will support future organic growth.

"We are confident of delivering further progress in the year ahead, with our
extensive platform positioning us strongly to capitalise on the multiple
growth opportunities available in a fragmented retail financial services
market."

 

Notice of Full Year Results

 

Fintel intends to announce its Full Year Results for the year ended 31
December 2024 on 18 March 2025.

 

Footnotes

(1)Core business excludes revenues from panel management and surveying.

(2)Adjusted EBITDA is earnings before interest, tax, depreciation,
amortisation, share option charges and exceptional operating costs.

(3) Net debt position excludes any adjustment under IFRS16 "Lease Accounting"
and compares gross cash balances to gross borrowings under the Group's £80m
Revolving Credit Facility.

(4)Like-for-like basis strips out the impact of acquisitions and the changes
in revenue recognition of a software reseller agreement.

 

 

For further information, please contact:

 

 Fintel plc                                     via MHP Group

 Matt Timmins (Joint Chief Executive Officer)

 Neil Stevens (Joint Chief Executive Officer)

 David Thompson (Chief Financial Officer)

 Zeus (Nominated Adviser and Joint Broker)      +44 (0) 20 3829 5000

 Martin Green

 Dan Bate

 Investec Bank (Joint Broker)                   +44 (0) 20 7597 5970

 David Anderson

 Kamalini Hull

 MHP Group (Financial PR)                       +44 (0) 7736 464749

 Reg Hoare                                      Fintel@mhpgroup.com (mailto:Fintel@mhpgroup.com)

 Robert Collett-Creedy

 

Notes to Editors

Fintel is a UK fintech and support services business, combining
award-winning intermediary business support services, and leading research,
ratings and fintech businesses.

Fintel provides technology, compliance and regulatory support to thousands of
intermediary firms, data and targeted distribution services to hundreds of
product providers and empowers millions of consumers to make better informed
financial decisions. We serve our customers through three core divisions:

The Intermediary Services division provides technology, compliance, and
regulatory support to thousands of intermediary businesses through a
comprehensive membership model. Members include directly authorised IFAs,
Wealth Managers and Mortgage Brokers.

The Distribution Channels division delivers market Insight and analysis and
targeted distribution strategies to financial institutions and product
providers. Clients include major Life and Pension companies, Investment
Houses, Banks, and Building Societies.

The Fintech and Research division (Defaqto) provides market leading
software, financial information and product research to product providers and
intermediaries. Defaqto also provides product ratings (Star Ratings) on
thousands of financial products. Financial products are expertly reviewed by
the Defaqto research team and are compared and rated based on their
underlying features and benefits. Defaqto ratings help consumers compare and
buy financial products with confidence.

For more information about Fintel, please visit the
website: www.wearefintel.com
(https://protect.checkpoint.com/v2/r06/___http:/www.wearefintel.com/___.ZXV3MjpuZXh0MTU6YzpvOjM5NWVhNGE0NmUxZTgwNjY1NjQzNGY1NGMwMTcxNWJiOjc6MzQ5YTo4N2YwMDdmNmRiZWVjZGQyOTM1MWZkMDA0NmNkMmE2NWYxOGQ5MDZhOTY5NzdmMzMxMTFjMmJmY2MyODllOWJiOnA6VDpU)

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