REG - Mind Gym PLC - Half Year Trading Update & Notice of Results

Mind GymAnnouncement

22/10/2024 07:00

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RNS Number : 0267J  Mind Gym PLC  22 October 2024

22 October 2024

 

Mind Gym plc

 ("Mind Gym" or the "Company" or "Group")

Half Year Trading Update and Notice of Interim Results

MindGym (AIM: MIND), the global provider of human capital and business
improvement solutions, provides a trading update for the six months ended 30
September 2024.

MindGym has embarked on a transformation strategy to evolve the business from
episodic training provider to behaviour change partner, which will set the
Group up to earn more sustainable, repeatable revenues.  The strategy is on
track and in FY25 to date, which is a year of transition, the Group is
performing in line with the Board's expectations for a return to
profitability.

There continues to be challenging market conditions for HR services, reflected
by cautious buying behaviours and postponed contracts. This has been
particularly pronounced in the US where there has been a sustained reduction
in client spend, especially as it relates to DEI initiatives.  Performance in
EMEA has been strong, helped by the multi-year energy framework agreement,
which has delivered the expected levels of revenue over its three-year term
and is due to end in December 2024.

Financial highlights

The Group expects to report:

·      H1 revenues of £20.2m

o  3% lower than the comparative period last year (2% in constant currency).

o  Performance in EMEA has been strong with revenues of £12.1m, a 24%
improvement versus H1 FY24.

o  In the US, performance has been impacted by the challenging market
conditions outlined above, with H1 revenues expected to be down 27% to £8.1m
(25% down in constant currency).

·      A return to EBITDA profitability in H1 vs the £4.1m adjusted
loss reported in H1 FY24.

·      During the period, MindGym negotiated a new £4m overdraft
facility which replaces the expiring RCF and reduces ongoing financing
costs.  As at 30 September 2024, cash at bank was £0.7m which, combined with
access to the £4m undrawn overdraft facility, provides the Group with
adequate liquidity.

Strategic and operational highlights

·      A core focus has been to increase operational efficiency and
resilience.    In H1 FY25 the Group has continued to globalise its
organisational structure and reduce the cost base, which aligns with the
strategic priorities.

·      In Q2, MindGym's Diagnostics offering was succesfully launched
with a number of clients, and will be followed by additional diagnostics and
analytics offerings in H2.  This is key to the strategy of building long term
client relationships and for generating new, proprietary insights from primary
data.

·      In H2, after significant market testing, we will be launching the
first of our new integrated packages which combine proprietary diagnostics,
digital self-directed and live deliveries.  Future releases will also
incorporate AI.  The Group will also be launching a new IP package for
clients who have, or want, their own in-house, certified MindGym coaches.

Outlook

·      H2 revenues are expected to be broadly in line with H1,
reflecting the on-going challenging market conditions.

·      The Board's expectations for FY25 of adjusted EBITDA remain
unchanged, with the actions taken providing greater resilience and expected to
lead to improved profitability in due course.

Board change

As separately announced today, Mind Gym confirms the appointment of Emily
Fyffe as CFO and a Director of the Company.  This follows the announcement of
28 August 2024 when Emily was announced as CFO Designate and successor to
Dominic Neary who leaves the Group on 25 October 2024.

Notice of Half Year Results

Mind Gym will announce its half year results on 3 December 2024.

Christoffer Ellehuus, Chief Executive Officer of MindGym, commented:

"MindGym has delivered a resilient performance with significant improvement in
profitability, despite a macroeconomic environment for HR services that
remains challenging.  We are making good progress on our strategy to
productise and digitise our IP, making MindGym solutions easy to buy, easy to
deliver, and easy to renew, whilst delivering more sustainable, repeatable
revenues.  We therefore remain confident in the long-term prospects of the
business."

Enquiries

 Mind Gym plc                                    +44 (0) 20 7376 0626
 Christoffer Ellehuus, Chief Executive Officer   investors@themindgym.com (mailto:investors@themindgym.com)

 Emily Fyffe, Chief Financial Officer

 Panmure Liberum (Nominated Adviser and Broker)  +44 (0) 20 3100 2000
 Nick How

 Anake Singh

 MHP Communications (for media enquiries)        +44 (0) 7885 447 944
 Reg Hoare                                       mindgym@mhpgroup.com (mailto:mindgym@mhpgroup.com)

 Katie Hunt

 Veronica Farah

 

About MindGym

MindGym is a company that delivers business improvement solutions using
scalable, proprietary products which are based on behavioural science.  The
Group operates in three global markets: business transformation, human capital
management and learning & development.

MindGym is listed on the London Stock Exchange Alternative Investment Market
(ticker: MIND) and headquartered in London. The business has offices in
London, New York and Singapore.

Further information is available at www.themindgym.com
(http://www.themindgym.com/) @themindgym

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