REG - PensionBee Group plc - FY2021 Trading Update Announcement

PensionbeeAnnouncement

20/01/2022 07:05

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RNS Number : 0194Z  PensionBee Group plc  20 January 2022

 PensionBee Group plc
 Incorporated in England and Wales
 Registration Number: 13172844
 LEI: 2138008663P5FHPGZV74
 ISIN: GB00BNDRLN84

 20 January 2022

 PensionBee Group plc
 Trading Update for the year ending 31 December 2021
 Revenue Growth over 100% exceeds guidance
 with continued strong growth across all core KPIs

 PensionBee Group plc ("PensionBee" or "the Company"), a leading online pension
 provider, today announces a trading update for the year ending 31 December
 2021.*

 Highlights*

 ●            Revenue growth of 103% year on year to £13m (2020: £6m) ahead of guidance,
              with December Annual Run Rate Revenue of £16m and resilient contractual gross
              revenue margin of 69bps
 ●            Continued to deliver strong performance across all core KPIs during the fourth
              quarter, in line with guidance and expectations
 ●            Assets under Administration (AUA) increased by 91% year on year to £2.6bn
              (2020: £1.4bn), driven predominantly by strong net flows from new and
              existing customers and supported by market growth
 ●            Registered Customer base increased by 63% year on year to 658,000 (2020:
              403,000)
 ●            Invested Customer base increased by 70% year on year to 117,000 (2020: 69,000)
 ●            Continued improvement in same-year conversion of Registered Customers to
              Invested Customers to 18% (2020: 17%)
 ●            Excellent Trustpilot rating and Customer Retention Rate of >95% maintained

 

 The Company has continued to scale up investment in marketing, with a focus on
 maximising return on investment whilst ensuring that Cost per Invested
 Customer ("CPIC") remains within the desired range of £200-250, as previously
 communicated. Total AUA has increased by 91% year on year driven by both new
 and existing customer inflows, demonstrating that the product offering
 continues to resonate strongly with customers as well as the effectiveness of
 the marketing campaigns to date. The average pension pot size has continued to
 increase as pension savings across the country grow and as the Company
 continues to attract more mature savers.

 The Company remains at the forefront of innovation, developing its scalable,
 industry-leading technology platform. Over the year, the Company continued to
 invest in automation, driving operational efficiency and margin improvement.
 New product releases have enabled customers to self-serve, complementing the
 Company's excellent customer service capabilities. In addition, the Company's
 proprietary data platform provides important insights into consumer behaviour,
 supporting decision-making to optimise marketing and return on investment.

 Outlook

 The Board remains confident in the continued growth opportunity for the
 Company and is pleased to re-iterate the medium-term financial guidance
 provided at the time of the IPO. In addition, due to increasing revenue
 visibility as customer numbers continue to grow, the Board now announces
 additional short-term guidance for FY2022. The Company is expected to generate
 in excess of £20m of revenue for FY2022. Further margin improvement during
 the year will enable Adjusted EBITDAM profitability by December 2022, assuming
 relative market stability.

 The Company will continue to invest in marketing and customer acquisition
 through 2022 to ensure that it is best positioned to capture the significant
 opportunity in the UK defined contribution pensions market. The Board
 anticipates that marketing spend will be weighted towards H1 2022, with CPIC
 experiencing a strong decline towards the end of the year.

 Preliminary results for the 12 months to 31 December 2021 will be released on
 17 March 2022.
 It is expected that PensionBee will transition from the High Growth Segment to
 the Premium Segment of the Main Market in the first half of 2022.

 There will be a presentation for analysts and investors this morning at 8:30am
 via webcast. Please contact pensionbee@tulchangroup.com if you would like to
 attend.

 Romi Savova, CEO of PensionBee, commented:

 "We are delighted to report another period of strong operational and financial
 performance, with revenue growing by more than 100% year on year - in excess
 of our guidance given at the time of our IPO. Our focus on efficient, data-led
 marketing has helped us to increase our customer base considerably as we
 continue to seize the significant opportunities in front of us. We are looking
 forward to further capitalising on these market drivers in the year ahead,
 responding to our customers' needs in order to help everyone achieve a happy
 retirement."

Financial Summary*
 

                                           As at Period End
                                           Dec-2019  Dec-2020  Dec-2021  YoY change

 AUA (£m)(1)                               745       1,358     2,587     91%
 AUA Retention Rate (% of AUA)(2)          >95%      >95%      >95%      Stable
 Registered Customers (thousands)(3)       232       403       658       63%
 Active Customers (thousands)(4)           64        119       172       44%
 Invested Customers (thousands)(5)         38        69        117       70%
 Customer Retention Rate (% of IC)(6)      >95%      >95%      >95%      Stable
 Cost per Invested Customer (£)(7)         206       232       246       Within Threshold
 Same Year RC: IC Conversion (% of RC)(8)  16%       17%       18%       +1 ppt
 Contractual Revenue Margin (% of AUA)(9)  0.68%     0.69%     0.69%     Stable

 

 

                                            For the Period Ending
                                            Dec-2019  Dec-2020  Dec-2021  YoY change

 Revenue (£m)(10)                           4         6         13        103%
 Annual Run Rate Revenue (£m)(11)           5         9         16        85%
 Adjusted EBITDA (£m)(12)                   (6)       (10)      (16)      57%
 Adjusted EBITDA Margin (% of Revenue)(13)  (166)%    (166)%    (128)%    +38 ppt

 

                                For the Period Ending
                                FY-2019  FY-2020  FY-2021  YoY change

 Opening AUA (£m)(1)            328      745      1,358    82%
 Gross Inflows (£m)             378      593      1,099    85%
 Gross Outflows (£m)            (34)     (70)     (145)    106%
 Net Inflows (£m)               344      523      955      83%
 Market Growth and Other (£m)   73       90       275      n/m
 Closing AUA (£m)(1)            745      1,358    2,587    91%

 

 *    Financial results for FY-2021 are unaudited.
 1   Assets under Administration (AUA) is the total invested value of pension
     assets within PensionBee Invested Customers' pensions. It measures the new
     inflows less the outflows and records a change in the market value of the
     assets. AUA is a measurement of the growth of the business and is the primary
     driver of Revenue.
 2   AUA Retention measures the percentage of retained PensionBee AUA from Transfer
     Outs over the average of the trailing twelve months. High AUA retention
     provides more certainty of future Revenue. This measure can also be used to
     monitor customer satisfaction.
 3   Registered Customers (RC) measures customers who have started the sign-up
     process and have submitted at least a name and an email address and includes
     those customers who are classified as Active Customers.
 4   Active Customers (AC) means all customers who have requested to become an
     Invested Customer by accepting PensionBee's terms of business but for whom the
     transfer or contribution process is not yet completed and all customers who
     are classified as Invested Customers.
 5   Invested Customers (IC) means those customers who have transferred pension
     assets or made contributions into one of PensionBee's investment plans.
 6   Customer Retention Rate measures the percentage of retained PensionBee
     Invested Customers over the average of the trailing twelve months. High
     customer retention provides more certainty of future Revenue. This measure can
     also be used to monitor customer satisfaction.
 7   Cost per Invested Customer (CPIC) means the cumulative advertising and
     marketing costs incurred since PensionBee commenced trading up until the
     relevant point in time divided by the cumulative number of Invested Customers
     at that point in time. This measure monitors cost discipline of customer
     acquisition. PensionBee's desired CPIC threshold is £200-£250.
 8   Same Year RC:IC Conversion percentage is calculated by dividing the number of
     Invested Customers as at the end of the period by the number of Registered
     Customers at the end of the period. This measure monitors PensionBee's ability
     to convert customers through the acquisition funnel.
 9   Contractual Revenue Margin means the weighted average contractual fee rate
     across PensionBee's investment plans (before applying any size discount)
     calculated by reference to the amount of AUA held in each plan across the
     period.
 10  Revenue means the income generated from the asset base of PensionBee's
     customers, essentially annual management fees charged on the AUA, together
     with a minor revenue contribution from other services.
 11  Annual Run Rate (ARR) Revenue is calculated using the Recurring Revenue for
     the relevant month multiplied by 12.
 12  Adjusted EBITDA is the profit or loss for the period before taxation, finance
     costs, depreciation, share based compensation and transaction costs.
 13  Adjusted EBITDA Margin means Adjusted EBITDA as a percentage of Revenue for
     the relevant period.

 

 Enquiries:
 PensionBee              via Tulchan
 Tulchan Communications  pensionbee@tulchangroup.com

 James Macey White       +44 (0)20 7353 4200

 Victoria Boxall

 Laura Marshall

 About PensionBee

 PensionBee is a leading online pension provider, enabling customers to manage
 their savings through its unique combination of smart technology and dedicated
 customer service.

 Since it was founded in 2014 by Romi Savova, PensionBee has been a challenger
 in an industry ripe for disruption. It has grown rapidly by helping consumers
 to solve the challenges they face when it comes to locating, combining and
 managing their pension savings. PensionBee counts 172,000 Active Customers
 from 18-80 years of age with £2.6 billion in Assets under Administration as
 at 31 December 2021. Its range of pension plans are tailored to its customers
 and are managed by some of the world's largest money managers including:
 BlackRock, HSBC, Legal & General and State Street Global Advisors.

 PensionBee uses its proprietary technology and Open APIs to allow customers to
 manage their pension easily, view their live balance, and with the help of a
 smart calculator to plan their savings, make contributions and withdrawals
 online, all with transparency on fees. It continuously engages with customers
 through its dedicated customer account managers using jargon-free
 communication and listens to feedback to develop new tools which help
 customers to easily plan for their retirement. PensionBee has consistently
 maintained a Customer Retention Rate and an AUA Retention Rate of >95% and
 an Excellent Trustpilot rating.

 PensionBee is admitted to trading on the High Growth Segment of the London
 Stock Exchange's Main Market (LON:PBEE).

 

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