REG - PensionBee Group plc - 1H 2023 Results Announcement

PensionbeeAnnouncement

20/07/2023 07:00

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RNS Number : 5773G  PensionBee Group plc  20 July 2023

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

 20 July 2023

 

 PensionBee Group plc
 Trading Update for the six months ended 30 June 2023

 Continued strong growth across all key metrics
 On track to achieve ongoing Adjusted EBITDA profitability by end of 2023

 PensionBee Group plc ('PensionBee' or the 'Company'), a leading online pension
 provider, today announces a trading update for the six months ended 30 June
 2023.

 Highlights

 

 ●            Strong continued customer growth, with Invested Customers having increased by
              33% year on year to 211,000 (June 2022: 159,000).
 ●            Assets under Administration increased by 38% year on year to £3,704m (June
              2022: £2,676m), underpinned by strong Net Inflows from new and existing
              customers.
 ●            Successful launch of LifeSearch partnership with initial positive customer
              demand.
 ●            Commitment to continuous product innovation and outstanding customer service
              contributed to a sustained high Customer Retention Rate of c.97%.
 ●            LTM Revenue increased by 30% to £20m (June 2022: £16m) and first half
              Revenue increased by 32% to £11m (June 2022: £8m).
 ●            Adjusted EBITDA of £(8)m (June 2022: £(15)m), reflecting continued progress
              towards profitability.
 ●            On track to achieve ongoing Adjusted EBITDA profitability by the end of 2023
              and profitability for the full year 2024.

 

 PensionBee delivered strong growth across all of its key performance
 indicators in the first half of the year, with Assets under Administration
 ('AUA') increasing by 38% to £3,704m.

 The Company has seen excellent momentum in the growth of the customer base,
 adding approximately 30,000 new Invested Customers in the first half of the
 year, taking the overall Invested Customer base to 211,000. This demonstrates
 the continued success of its data-led, multi-channel customer acquisition
 approach and highlights the clear demand for its customer-focused proposition.

 Revenue for the first half of the year grew by 32% year on year to £11m as a
 result of strong Net Inflows from new and existing customers, with LTM Revenue
 increasing by 30% to £20m. The Company's sustained high Customer Retention
 Rate and AUA Retention Rate, both c.97%, have continued to drive recurring
 revenue.

 Continued Advancement of Strategic Goals

 Sustained marketing investment of £7m across the last two quarters has
 supported brand building and customer acquisition. PensionBee expects to
 continue investing in its brand awareness through the renewal of its
 partnership with Brentford FC, becoming the left sleeve sponsor of the Men's
 first team and the 'front of shirt' sponsor for the B team, Academy and
 Women's team. The Company has continued to apply its data-driven,
 multi-channel approach to successfully reach new customers, bringing
 educational initiatives to customers through roadshows, podcasts and new
 channels such as TikTok. The Cost per Invested Customer has continued to
 demonstrate a downward trajectory, in line with expectations, given the depth
 of the Company's marketing capability in efficient customer acquisition.

 PensionBee has continued to innovate and adapt its products to suit the
 evolving needs of its customers and to support customer engagement. It has
 added free informative content and helpful tools, including a state pension
 age calculator. The in-app offering has been enhanced via the launch of in-app
 content delivering helpful insights to mobile app users to increase their
 transfer and saving rates. The Company has also launched a successful
 partnership with LifeSearch, helping customers to obtain a range of insurance
 products and critical illness cover which enable them to continue to save for
 a happy retirement even in the event of unforeseen circumstances, with initial
 positive customer demand. The Company's focus on delivering outstanding
 customer service has been evidenced through the maintenance of its Excellent
 Trustpilot rating and rapid response times on the phone and live chat.

 The Company has continued to invest in the scalability of its technology
 platform through a focus on internal automation, efficiency, security and
 pension transfer improvements to support productivity, as demonstrated by a
 12% improvement in productivity(1) over the first half of the year. The
 Company will continue to explore and adopt artificial intelligence tooling
 within its departments, using it for initial content generation, project
 research and coding problem resolution. It is increasingly integrating its
 data platform within daily product management operations to ensure its
 multidisciplinary development teams remain productive and impactful.

 Outlook

 The Board remains confident in PensionBee's potential for continued growth and
 profitability, due to its ability to attract new customers that generate
 growth in recurring revenue through its scalable technology platform.

 The Company is pleased to reiterate the guidance previously provided at the
 time of the 2022 full year results. Its strong cash balance of £14m leaves it
 well-placed to pursue a c.2% market share target of the substantial £700bn UK
 transferable pensions market over the next 5-10 years, resulting in a
 long-term potential revenue opportunity of approximately £150m.

 The Company remains on track to further reduce Cost per Invested Customer,
 expecting to achieve ongoing Adjusted EBITDA profitability by the end of 2023
 and profitability for the full year 2024. PensionBee expects to achieve
 long-term EBITDA margins in excess of 50%, driven by the scalability of its
 technology platform. This is supported by the Company's continued positive
 momentum in its trading performance and growth in key metrics such as customer
 growth and AUA.

 Analyst and Investor Presentation

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

 Romi Savova, CEO of PensionBee, commented:

 "We are delighted to report a successful first half of 2023 as we pursue our
 mission to make pensions simple so that everyone can look forward to a happy
 retirement. We have continued growing our Assets Under Administration and
 Revenue by acquiring new customers and helping our existing customers to save
 more in their pensions.

 We are preparing the Company for the achievement of ongoing Adjusted EBITDA
 profitability in the second half of the year by consistently focusing on our
 productivity and harnessing the scalability of our technology platform. We
 have continued to invest effectively in our marketing initiatives, maintaining
 our household brand name status. We are proud to have launched additional
 helpful features, such as in-app content and life insurance, to help our
 customers navigate a testing economic environment. The market opportunity for
 PensionBee is vast and our strong cash balance leaves us well-positioned to
 continue capturing market share."

 Financial Summary

 

                                        As at Period End
                                        Jun-2022  Jun-2023  YoY change
 AUA (£m)(2)                            2,676     3,704     38%
 AUA Retention Rate (% of AUA)(3)       >95%      >95%      Stable
 Invested Customers (thousands)(4)      159       211       33%
 Customer Retention Rate (% of IC)(5)   >95%      >95%      Stable
 Cost per Invested Customer (£)(6)      260       247       (5)%
 Realised Revenue Margin (% of AUA)(7)  0.63%     0.65%     +1 bps

 

                             For the Trailing 12-month Period Ending
                             Jun-2022        Jun-2023        YoY change
 LTM Revenue                 16              20              30%
 LTM Adjusted EBITDA         (24)            (13)            (47)%
 LTM Adjusted EBITDA Margin  (152)%          (62)%           90ppt*

 

                                            For the 6 month Period Ending
                                            Jun-2022    Jun-2023    YoY change
 Revenue (£m)(8)                            8           11          32%
 Adjusted EBITDA (£m)(9)                    (15)        (8)         (47)%
 Adjusted EBITDA Margin (% of Revenue)(10)  (181)%      (73)%       108ppt*

 

                                     For the 6 month Period Ending
                                     Jun-2022    Jun-2023    YoY change
 Opening AUA (£m)(2)                 2,587       3,025       17%
    Gross Inflows (£m)               579         612         6%
    Gross Outflows (£m)              (98)        (143)       47%
 Net Inflows (£m)                    481         469         (3)%
    Market Growth and Other (£m)     (392)       210         n/a
 Closing AUA (£m)(2)                 2,676       3,704       38%

 

Notes

 *   ppt is the absolute change in percentage.
 1   Invested Customers per Staff Member calculated using LTM average for total
     workforce. Management information as at 30 June 2023.
 2   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.
 3   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.
 4   Invested Customers ('IC') means those customers who have transferred pension
     assets or made contributions into one of PensionBee's investment plans.
 5   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.
 6   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.
 7   Realised Revenue Margin is calculated by using the last twelve months of
     Recurring Revenue over the average quarterly AUA held in PensionBee's
     investment plans over the period.
 8   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.
 9   Adjusted EBITDA is the profit or loss for the period before taxation, finance
     costs, depreciation, share based compensation and transaction costs.
 10  Adjusted EBITDA Margin means Adjusted EBITDA as a percentage of Revenue for
     the relevant period.

 

 Contacts
 PensionBee        press@pensionbee.com

 Rachael Oku

 Laura Dunn-Sims

About PensionBee

 PensionBee is a leading online pension provider, making pension management
 easy for its customers while they save for a happy retirement.

 PensionBee helps its customers combine their old pension pots, make flexible
 contributions, invest in line with their goals and values and make withdrawals
 from the age of 55 (increasing to 57 in 2028). PensionBee offers a range of
 investment plans, including fossil fuel free options, from some of the world's
 largest asset managers.

 Operating in the £1 trillion market of Defined Contribution pension assets,
 PensionBee has grown rapidly through its direct-to-consumer marketing
 activities, creating a household brand name for the mass market.

 The Company has £3.7 billion in Assets Under Administration and 211,000
 Invested Customers as at 30 June 2023. PensionBee has consistently maintained
 a Customer Retention Rate in excess of 95% and an Excellent Trustpilot rating,
 reflecting its commitment to outstanding customer service.

About PensionBee

PensionBee is a leading online pension provider, making pension management
easy for its customers while they save for a happy retirement.

 

PensionBee helps its customers combine their old pension pots, make flexible
contributions, invest in line with their goals and values and make withdrawals
from the age of 55 (increasing to 57 in 2028). PensionBee offers a range of
investment plans, including fossil fuel free options, from some of the world's
largest asset managers.

 

Operating in the £1 trillion market of Defined Contribution pension assets,
PensionBee has grown rapidly through its direct-to-consumer marketing
activities, creating a household brand name for the mass market.

 

The Company has £3.7 billion in Assets Under Administration and 211,000
Invested Customers as at 30 June 2023. PensionBee has consistently maintained
a Customer Retention Rate in excess of 95% and an Excellent Trustpilot rating,
reflecting its commitment to outstanding customer service.

 

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