Ten Lifestyle Group: Half Year Results
Ten Lifestyle Group plc (AIM: TENG), a leading technology-enabled lifestyle and travel platform for the world’s wealthy and mass affluent, announces its unaudited Interim Results for the six months ended 28 February 2018* (“H1 2018”, or “the period”).
- Record member satisfaction levels, measured by Net Promoter Score.
- Contract wins include HSBC Group, Visa International, OCBC Bank** and Japanese MI Card***.
- 12 Large and Medium contracts won. An increase to 27 from 15 at the end of FY 2017. This is made up of 21 Medium and 6 Large contracts**** (previously 11 Medium and 4 Large). These contracts will show a full year impact only in FY 2019.
- Continued investment into technology and associated content has helped to drive new business wins and to improve operational efficiencies.
- Ten’s proprietary digital platform is now available in 10 languages with contracted commitment for rollout in all three global regions in summer 2018 with multiple client brands.
- Continued expansion into new geographies including two new offices in the Americas.
- New hires have strengthened leadership team and operational and technology teams.
- Successfully listed on the AIM Segment of the London Stock Exchange in November 2017 which resulted in net cash to the Group of £25.1m.
- Revenue up 5% to £18.2m (H1 2017: £17.4m).
- Net Revenue***** up 6% to £17.3m (H1 2017: £16.4m).
- Adjusted EBITA****** of £1.4m loss (H1 2017: £0.8m gain) reflects investment activities and international roll out.
- Loss before interest and tax of £3.8m (H1 2017: £0.3m loss), including share based payment expense and exceptional costs relating to the AIM listing. This is an improved position versus expectations.
- Robust balance sheet following admission to the AIM with cash at the end of H1 2018 of £24.4m (FY 2017: £8.2m) and all long-term debt repaid.
Profit & Loss
- Net Revenue: £17.3m (2017: £16.4m)
- Adjusted EBITA: -£1.4m (2017: £0.8m)
- Adjusted EBITA %: -8% (2017: 5%)
- Operating Loss Before Interest & Tax: £3.8m (2017: £0.3m)
- Profit/ Loss for the period: £-4.9m (2017: £0.2m)
Post Period End Activities and Outlook
- As announced on 30 April 2018, Ten reduced Net Revenue growth expectations for the financial years ending 31 August 2018 and 2019 compared to expectations at IPO.
- Net Revenue in H2 2018 is expected to show accelerating growth versus H1 2018 as new business wins generate additional revenue, underpinned by increased investment in infrastructure.
- In FY 2019 management expects to see further growth in Net Revenue. Whilst there can be no certainty of this, two new Large contracts and four new Medium contracts that were expected in FY 2018 are now expected in FY 2019. Pipeline of new business remains strong and is larger than at the time of IPO. We have won over 80% of the contracts we have tendered for since 2015 in our core financial services market.
- We are continuing to invest into our newer geographies and into developing the content and technology to help our digital platform become established in multiple geographical markets.
- Development of new vertical markets (outside of our core market of financial services) is happening later than expected, with revenue expected to commence in H2 2019 (e.g. from our employee vertical market).
Alex Cheatle, CEO of Ten Lifestyle Group, said;
“We are delighted with the increase in member satisfaction levels. We believe this underpins and validates our corporate reputation, market leading proposition and growth expectations and is essential for us to achieve our mission to become the world’s most trusted consumer service. We have won and launched contracts with major new corporate clients that will provide accelerated growth in H2 2018 and continued organic growth in FY 2019. Furthermore, we have retained all our Medium or Large contracts since IPO. Overall, we believe that Ten’s customer and competitive proposition has strengthened over recent months and our current new business pipeline is stronger and more robust than at the time of IPO. This is supported by both our investment into proprietary technology and our ever-growing geographical reach which we believe allows us to pitch more powerfully for more opportunities in major markets globally. We are as convinced as ever about the significant market opportunity and Ten’s growth potential within that market as well as our ability to generate value for our shareholders.”