REG - PensionBee Group plc - Announcement of Proposed US Expansion

PensionbeeAnnouncement

04/03/2024 07:00

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RNS Number : 4125F  PensionBee Group plc  04 March 2024

PensionBee Group plc

Incorporated in England and Wales

Registration Number: 13172844

LEI: 2138008663P5FHPGZV74

ISIN: GB00BNDRLN84

 

The information contained within this announcement is deemed to constitute
inside information as stipulated under the retained EU law version of the
Market Abuse Regulation (EU) No. 596/2014 (the 'UK MAR') which is part of UK
law by virtue of the European Union (Withdrawal) Act 2018. The information is
disclosed in accordance with the Company's obligations under Article 17 of the
UK MAR. Upon the publication of this announcement, this inside information is
now considered to be in the public domain.

 

 

4 March 2024

 

PensionBee Group plc

 

Announcement of Proposed US Expansion

 

PensionBee Group plc ('PensionBee' or the 'Company'), a leading online pension
provider, today announces it has entered into an exclusive, non-binding term
sheet with a large, US-based global financial institution in order to expand
into the United States of America ('US'). The US has the world's largest
Defined Contribution pension market, representing approximately 80% of the
global total and $22.5 trillion in assets.(1)

 

Under the proposed strategic relationship, PensionBee will deliver the US
service through PensionBee Inc, to be established in Delaware as a
wholly-owned subsidiary of PensionBee Group plc, with operational headquarters
in New York.

 

PensionBee will manage the operations of the US business, including the hiring
of a local team, making available its award-winning online retirement
proposition and UK-based proprietary technology to consumers in the US Defined
Contribution market. PensionBee will enable US consumers to easily consolidate
and roll over their 401(k) plans into a new Individual Retirement Account
('IRA').(2)

 

The US-based partner will provide its expertise and substantial marketing
funding. Correspondingly, PensionBee's financial contribution will be financed
from the existing resources of PensionBee Group plc.

 

Entry into a final binding agreement between the parties is subject to
confirmatory due diligence, legal documentation and regulatory approvals, with
launch expected in late 2024.

 

In the UK, following close to a decade of operations, PensionBee will continue
to grow its market share in the £1 trillion Defined Contribution pension
market in accordance with current guidance on revenue growth and
profitability, operating the UK business as financially separate to the US
undertaking. As at the end of 2023, PensionBee had £4.4 billion of Assets
Under Administration on behalf of approximately one quarter of a million
Invested Customers.(3) PensionBee achieved ongoing Adjusted EBITDA
profitability at the end of 2023 and expects to be profitable in the UK on an
Adjusted EBITDA basis for the full 2024 financial year.(4)

 

Given the context of the enormous US market opportunity, PensionBee sees the
potential for its US business to grow rapidly, becoming at least the size of
its UK business over the next decade.

 

Romi Savova, CEO of PensionBee, commented:

 

"In the year of our 10th anniversary, having demonstrated underlying
profitability, we have entered discussions with a view to deploying our
award-winning customer proposition, supported by our innovative technology
platform and marketing approach, in the United States of America. This is a
transformative step for PensionBee and for our stakeholders.

 

By entering the world's largest Defined Contribution pension market, where
many consumers still struggle to prepare adequately for retirement amidst an
array of confusing and difficult to use investment options, our
straightforward approach to online retirement savings will help millions of
consumers look forward to a happy retirement."

 

Notes:

1.   Investment Company Institute, "Release: Quarterly Retirement Market
Data" as at 13 December, 2023. Includes the sum of Defined Contribution Plans
and IRAs.

2.   A 401k is an employer-sponsored Defined Contribution retirement plan
into which employees can contribute and into which employers may also make
matching contributions. An individual retirement account ('IRA') is a
tax-advantaged retirement savings account into which an individual can
contribute either pre- or post-tax money and which grows on either a
tax-deferred or tax-free basis.

3.   Assets under Administration means 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. Invested Customers means those customers who have transferred pension
assets or made contributions into one of PensionBee's investment plans.

4.   Adjusted EBITDA is the profit or loss for the period before taxation,
finance costs, depreciation, share based compensation and transaction costs.

 

Contacts

 

PensionBee

Becky O'Connor (+44) 7967 613925

Laura Dunn-Sims

press@pensionbee.com (mailto:press@pensionbee.com)

020 3557 8444

 

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 £4.4 billion in Assets Under Administration and 229,000 Invested
Customers as at 31 December 2023. PensionBee has consistently maintained a
Customer Retention Rate in excess of 95% and an Excellent Trustpilot rating
from more than 10,000 customers, 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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