Appreciate Group Plc - Half-year Report
APPRECIATE GROUP PLC
("Appreciate", "Appreciate Group" or "the Group")
Half Year Results
for the six months ended 30 September 2019
Continued strategic progress, with a resilient performance in line with the Board's expectations
Appreciate Group plc (AIM: APP), the UK's leading multi-retailer, multi-channel gift voucher and prepaid gift card provider, is pleased to announce its half year results for the six months ended 30 September 2019. Appreciate's business is highly seasonal; the first half of the year sees an expected loss with the majority of annual revenues and profit generated in the second half of the year.
- Billings increased by 10.3% to £120.2m (H1 2018: £109.0m)
- Revenue increased by 21.3% to £33.2m (H1 2018: £27.4m)
- Seasonal operating losses reduced to £2.0m (H1 2018: £2.3m)
- Pre-tax losses reduced to £1.3m (H1 2018: £1.5m loss)
- Proposed interim dividend of 1.05p (H1 2018: 1.05p)
- Cash balances, including cash held in trust, at 30 September 2019 of £211.8m (H1 2018: £212.4m)
- Strong growth in billings of 9.3% to £80.1m (H1 2018: £73.3m)
- Revenues up 23.8% to £24.3m (H1 2018: £19.6m) benefiting from increased demand and the addition of new clients
- Billings grew by 12.5% to £40.1m benefiting from significantly increased customer numbers through highstreetvouchers.com. Revenues increased by 14.9% to £8.9m (H1 2018: £7.8m).
- Christmas Savings benefited from earlier despatches than in the prior year
- Added new redemption partners (high street and online retailers, hospitality and leisure providers), focusing on brands that are more relevant to our current customer base and future target audience with greater online presence
Implementation of the strategic business plan during the half year
- Relocated our head office to Liverpool city centre
- Changed the company name to Appreciate Group plc, which more accurately describes our product range and helps to position the Group to take advantage of its growth aspirations
- Developed a Mastercard gifting product with digital fulfilment and mobile wallet capability that is being tested through the highstreetvouchers.com channel
- Began trialling a new consumer digital gifting product, Giftli, which appeals to a new millennial audience, ahead of a planned soft launch before Christmas 2019
- Invested in our technology, including initiating the first phase of Microsoft Dynamics 365 as our core ERP system
- Implemented Blue Venn as our new integrated digital marketing platform
- Outlook for trading for the second half and the year as a whole is unchanged
- Current year cost estimate of implementation of strategic business plan unchanged at £2.0m
- Good momentum in terms of implementing the remaining milestones of the strategic business plan
Ian O'Doherty, Chief Executive Officer, commented:
"Appreciate Group performed well in the first half, consistent with our expectations for the year as a whole, with strong operational performances in both consumer and corporate divisions. This was an extremely busy period for the Group as we continued to implement our strategic business plan whilst optimising the performance of the business.
"We continue to be encouraged by the significant progress we have made on delivery of our strategic business plan, including the development of new consumer products, and are optimistic about the benefits this will realise in a growing market."