Interim Results & Interim Dividend for the six months ended 30 June 2022
Over the first six months we have seen all our underlying growth drivers moving in the right direction and we reflect on a period of good momentum and clear strategic progress - the insurance book re-building substantially, a very strong period for Pay & Reward, and acceleration in our offering to the small and mid-sized business market. All of this reflects the continued high demand for workforce benefits and services and the relevance of our product offering.
Trading into July and August has remained robust, and in line with management’s expectations, giving the Board confidence in meeting market expectations for the full year. Operationally, the Company is full of activity, with the core business delivering well and new opportunities being driven forward by an energised workforce.
Financial Highlights
- Group revenue increased 5.8% to £34.7m (H1 2021: £32.8m)
- Annualised Premium Income for the Group’s largest division, Affordable Insurance, rebuilding post-pandemic, up 7% to £26.2m, providing a strong basis for future growth
- Adjusted EBITDA* of £1.5m (H1 2021: £4.1m), in line with management expectations reflecting the anticipated reduced contribution from insurance due to investment in policyholder acquisition and increased claims costs, offset by strong growth from other divisions
- Profit before tax of £0.5m (H1 2021: £3.2m) in line with adjusted EBITDA
- Basic EPS of 1.7p (H1 2021: 8.4p)
- Strong balance sheet and liquidity with cash and deposits at period end of £21.8m (Dec 2021: £22.9m), and debt free
- Interim dividend of 5.3p (H1 2021: 5.3p) to be paid, reflecting continued confidence in the Group’s business model and prospects
Operational Highlights
- 52 new client wins secured in the period including Vinci, Renfrewshire Council and BSI Group
- Strong retention and new insurance sales across Affordable Insurance segment, successfully building back towards pre-pandemic levels
- Continued substantial increase in contribution from SME channel via Sage Employee Benefits; Annual Recurring Revenue of £2.1m at 30 June 22 (£1.6m at 31 December 21, £1.2m at June 21)
- Hapi platform subscriptions showing growth; ARR of £1.7m at 30 June 22 (£1.5m at 31 December 21), with significant investment into the platform, driving immediate and ongoing cost savings
- Strong organic growth in Pay & Reward
