REG - JTC PLC - Pre-close Interim Trading Update

JTCAnnouncement

25/07/2024 07:00

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RNS Number : 7356X  JTC PLC  25 July 2024

25 July 2024

 

 

JTC PLC

(the "Company" and together with its subsidiaries "JTC" or the "Group")

 

Pre-close Interim Trading Update

 

Positive start to the 'Cosmos era' with record H1 new business wins and four
announced acquisitions

 

 

JTC, the global professional services business, today issues the following
trading update in advance of its interim results for the period ended 30 June
2024.

 

The Group has made a positive start to 2024, the first year of its Cosmos era
business plan, during which it aims to once again double revenue and
underlying EBITDA from that reported in 2023. The business has quadrupled in
size since IPO in 2018 through the successful delivery of its Odyssey era
(2018 to 2020) and Galaxy era (2021 to 2023) business plans.

 

Net organic revenue growth in H1 2024 was ahead of the Company's updated
guidance of 10%+ per annum, with record H1 new business wins of £18.8m, up
28.8% on the same period last year (H1 2023: £14.6m). The new business
enquiry pipeline going into H2 remains strong across both Divisions, with win
rates of c. 50%.

 

During the period, the Group has delivered against its well-established
guidance metrics for underlying EBITDA margin (33% - 38%) and leverage (1.5x -
2.0x underlying EBITDA). Cash conversion was strong, in line with levels
typically seen in the first half of the year, and the Company expects to
achieve its guidance range of 85% to 90% for the full year.  As a result, the
Board expects the Company to deliver full year 2024 results in line with
market expectations. 1  (#_ftn1)

 

M&A activity during the period included the completion or announcement of
four acquisitions:

 

·      Blackheath - ICS Division

London, UK, completed in March.

 

·      First Republic Trust Company - PCS Division

Delaware, USA, announced in April, completion expected within the coming
weeks.

 

·      FFP - ICS Division

Cayman, BVI and Dubai, announced in June, completion expected in Q4. FFP is a
strategically important acquisition for the Group as it directly supports the
development of its new Governance Services business line, a further innovation
from the Group Commercial Office.

 

·      Hanway - ICS Division

London, UK, completed in July.

 

These transactions are being funded by a combination of existing cash and
JTC's debt facilities, which were increased in 2023 to support delivery of the
Cosmos business plan. SDTC, the PCS Division platform business acquired in the
USA in 2023, continues to integrate well into the Group and performed strongly
in the period. The Company continues to maintain a well-developed pipeline of
acquisition opportunities spanning both Divisions and all target growth
markets.

 

In addition, as a result of the successful delivery of its Galaxy era business
plan, the Company has today granted a total of 4,748,909 awards over ordinary
shares of £0.01 each in the Company, amounting to c.£50m in value, to all
eligible current permanent Group employees, excluding the Executive Directors,
under the Employee Incentive Plan (the "EIP"). These awards follow the same
process as the grants made in 2021 which marked the successful completion of
the Odyssey era plan.

Shared ownership has been a cornerstone of JTC's culture, financial success,
industry-leading employee retention and attractiveness as an acquiror for the
past 26 years, dating back to the establishment of the first JTC Employee
Benefit Trust in 1998, making all employees 'owners' of the business. The EIP,
following in the footsteps of its predecessor schemes, aims to recognise and
reward long-term performance throughout the entire Group. This alignment of
employees' and shareholders' interests is closely tied to the Company's
multi-year business plans, which it refers to as eras. The Galaxy era EIP
Awards will be satisfied by the transfer of existing Ordinary Shares held by
JTC PLC Employee Benefit Trust (the "EBT") to each participant. As such, this
granting of shares under the EIP is non-dilutive to the existing shareholders
of the Group.

 

Nigel Le Quesne, CEO of JTC PLC, said:

 

"The Group has made a very good start to the Cosmos era, building on the
momentum of our outstanding results from 2023. Organic growth remains above
our updated guidance with record new business wins. We are extremely pleased
with the acquisitions made during the period, which support our strategy to
increase our footprint in key growth markets and expand our service offering
to better meet the needs of our global client base, therefore supporting
long-term organic growth.

 

I am delighted that the hard work and commitment to client service excellence
of our people has resulted in a shared ownership award for all our c. 1,800
employee-owners globally, in recognition of their successful delivery of our
Galaxy era business plan, in which they doubled the size of the Group in just
three years. Our commitment to shared ownership aligns the interests of our
people, our wider shareholder base, our clients and other stakeholders and has
already energised the business in this first year of our Cosmos era."

 

The Company will announce its interim results for the period ended 30 June
2024 on Tuesday 17 September 2024. An analyst briefing will be given by Nigel
Le Quesne, Chief Executive Officer, and Martin Fotheringham, Chief Financial
Officer, at 09:30 BST via video / audio conference.

 

Enquiries:

JTC
PLC
+44 (0) 1534 700 000

Nigel Le Quesne, Chief Executive Officer

Martin Fotheringham, Chief Financial Officer

David Vieira, Chief Communications Officer

 

Camarco                                                                      +44
(0) 20 3757 4980

Geoffrey
Pelham-Lane

Sam Morris

 

About JTC

JTC is a publicly listed, global professional services business with deep
expertise in fund, corporate and private client services. Every JTC person is
an owner of the business and this fundamental part of our culture aligns us
with the best interests of all of our stakeholders. Our purpose is to maximise
potential and our success is built on service excellence, long-term
relationships and technology capabilities that drive efficiency and add
value.

www.jtcgroup.com (http://www.jtcgroup.com/)

 

 1  (#_ftnref1) Analyst Consensus | JTC (jtcgroup.com)
(https://www.jtcgroup.com/investor-relations/analyst-consensus/)

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