REG - PensionBee Group plc - 3Q 2023 Results Announcement

PensionbeeAnnouncement

19/10/2023 07:00

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RNS Number : 5850Q  PensionBee Group plc  19 October 2023

 PensionBee Group plc

 Incorporated in England and Wales

 Registration Number: 13172844

 LEI: 2138008663P5FHPGZV74

 ISIN: GB00BNDRLN84

 

 Thursday 19 October 2023

 PensionBee Group plc

 Trading Update for the nine months ended 30 September 2023

 Successful strategy continues to drive 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 nine months ended 30
 September 2023.

 Highlights

 

 ·             Strong continued customer growth, with Invested Customers having increased by
               28% year on year to 223,000 (September 2022: 174,000).
 ·             Assets under Administration increased by 40% year on year to £3,902m
               (September 2022: £2,788m), underpinned by strong Net Inflows from new and
               existing customers.
 ·             Customer Retention remains >95%, driven by our focus on customer
               satisfaction and continuous product innovation.
 ·             LTM Revenue increased by 32% to £22m (Sept 2022: £17m) and the first nine
               months' Revenue increased by 33% to £17m (September 2022: £13m).
 ·             Year to date Adjusted EBITDA of £(9)m (September 2022: £(18)m) improving by
               51% year on year, driven by strong Revenue growth and cost efficiencies across
               the business. Adjusted EBITDA Margin for Q3 was (17)%, compared to (98)% and
               (50)% in Q1 and Q2 respectively, demonstrating a clear path to Adjusted EBITDA
               profitability by the end of 2023.

 

 PensionBee delivered strong growth across all of its key performance
 indicators in the first nine months of the year, with Assets under
 Administration ('AUA') increasing by 40% to £3,902m.

 The Company has seen excellent momentum in the growth of its customer base,
 adding approximately 40,000 new Invested Customers in the first nine months of
 the year, taking the overall Invested Customer base to 223,000. 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 nine months of the year grew by 33% year on year to
 £17m as a result of strong Net Inflows from new and existing customers, with
 LTM Revenue increasing by 32% to £22m. The Company's sustained high Customer
 Retention Rate and AUA Retention Rate, both >95%, have continued to drive
 recurring Revenue.

 Continued Advancement of Strategic Goals

 The Company's £9m marketing investment across the last three quarters has
 driven sustained brand awareness and customer acquisition. PensionBee has
 focused on cost-effective brand channels, such as YouTube and Tik Tok,
 reaching millions of consumers. This approach has been accompanied by
 continued investment in performance channels focused on search and social
 media, with data-led insights driving decision-making. 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, ensuring it meets the needs of its
 customers and supports their engagement. It has maintained its commitment to
 providing customers with helpful tools they need to achieve their retirement
 goals, such as its public calculators and informative video series. In
 addition, our award nominated podcast is now available within the app, making
 it easy for customers to access valuable content on the go. The Company's
 focus on delivering outstanding customer service has been evidenced through
 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. There has been further
 integration with the Company's proprietary data platform and product
 development processes to facilitate best practice decision making, as
 reflected by an 11% improvement in productivity.(1) PensionBee is focused on
 cyber security and providing a secure experience for its customers and has
 implemented a mandatory two-factor authentication for all customers.

 Outlook

 The Board remains confident in PensionBee's potential for continued growth and
 profitability, due to a combination of the strength and stability of its
 existing customer base, together with 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. The Company's ambition is to pursue a c.2%
 market share target of the substantial £700bn UK transferable pensions market
 over the next 5-10 years, translating to a Revenue ambition 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 for the full year 2024. PensionBee expects to achieve long-term EBITDA
 Margins in excess of 50%, leveraging the scalability of its technology
 platform and maintaining its high quality service. This is supported by the
 Company's continued positive momentum in its trading performance and growth in
 key indicators, such as Invested Customers and AUA. PensionBee continues to
 maintain a strong cash balance of £12.5m.

 Analyst and Investor Presentation

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

 Romi Savova, CEO of PensionBee, commented:

 "We are pleased to have continued growing our customer base throughout the
 year, helping more and more consumers to become Pension Confident. Our
 customers prioritise their retirement savings, ensuring they can keep track of
 their pensions by consolidating them and topping up their contributions. As a
 result, we have continued growing our Assets Under Administration and Revenue.
 We are confident in the delivery of ongoing Adjusted EBITDA profitability by
 the end of the year, marking an important milestone in PensionBee's corporate
 trajectory."

 

 

Financial Summary

 

                                        As at Period End
                                        Sept-2022  Sept-2023  YoY change
 AUA (£m)(2)                            2,788      3,902      40%
 AUA Retention Rate (% of AUA)(3)       >95%       >95%       Stable
 Invested Customers (thousands)(4)      174        223        28%
 Customer Retention Rate (% of IC)(5)   >95%       >95%       Stable
 Cost per Invested Customer (£)(6)      253        244        (4)%
 Realised Revenue Margin (% of AUA)(7)  0.64%      0.65%      +1bp

 

                             For the Trailing 12-month Period Ending
                             Sept-2022       Sept-2023       YoY change
 LTM Revenue                 17              22              32%
 LTM Adjusted EBITDA         (23)            (10)            55%
 LTM Adjusted EBITDA Margin  (137)%          (46)%           91ppt*

 

                                            Over the 9-month Period Ending
                                            Sept-2022    Sept-2023    YoY change
 Revenue (£m)(8)                            13           17           33%
 Adjusted EBITDA (£m)(9)                    (18)         (9)          51%
 Adjusted EBITDA Margin (% of Revenue)(10)  (143)%       (52)%        90ppt*

 

                                Over the 9-month Period Ending
                                Sept-2022    Sept-2023    YoY change
 Opening AUA (£m)(2)            2,587        3,025        17%
 Gross Inflows (£m)             838          923          10%
 Gross Outflows (£m)            (150)        (231)        54%
 Net Inflows (£m)               688          692          1%
 Market Growth and Other (£m)   (487)        185          n/a
 Closing AUA (£m)(2)            2,788        3,902        40%

 

 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 September 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 and impact investing 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 c.£3.9bn in Assets Under Administration and 223,000 Invested
 Customers as at 30 September 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.

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

 

 

 

 

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