SimplyBiz reports ‘strong and resilient’ trading for first half of 2020
has reported strong and resilient trading for the six months ended 30 June 2020 which the company said is demonstrative of “the robust nature” of the business.
In its half-year results, SimplyBiz said it had taken ‘strong and positive action in the first week of national lockdown to ensure it could fully support its customers and colleagues.
All services to intermediary customers were moved onto a proprietary digital platform and delivered without disruption, while decisive cost control and efficiency improvements were implemented which the group said will deliver sustained margin benefits in the future.
While the Distribution Channels division was significantly impacted by the COVID-19 restrictions, with revenues reducing by 31% to £9.2m, Fintech and Research remained the resilient segments for the Company with revenues growing 77% year on year.
The group therefore reported total revenue of £28.9m for the period, 1% lower than £29.1m recorded in the prior period.
Costs were strictly controlled during the period to deliver an operating profit increase of 56% to £5.0m (H1 2019: £3.2m, after exceptional charges of £3.0m).
Meanwhile, the group reported a robust adjusted EBITDA margin of 25.5% due to ‘continued revenue growth in higher margin sectors, rapid and decisive cost saving measures, and £0.8m received through the UK Government's assistance schemes.’
Shares in SimplyBiz have traded strongly over the past month and were trading 8.16% higher this morning at 161p following the announcement.
“The quality of our revenues, the resilience of our customers, and the benefits of a stronger digital delivery platform have enabled strong trading during challenging times,” said Matt Timmins, Joint CEO of The SimplyBiz Group.
He added, “We have responded quickly and decisively to deliver growth in key strategic areas, whilst improving the quality of our underlying earnings. We have accelerated our digital strategy. This data led, digital delivery, will further improve our quality of earnings, margins and cash generation going forward, whilst also improving customer service."
Post period end, trading has continued in line with the Board's expectations with organic growth expected to be driven by the Company's investments in digital services and technology offerings to its customers as well as increasing average revenue per customer.
The company highlighted to investors that an accelerated digital strategy ‘will deliver strong margin growth and greater cash and capital efficiency.’
The board said it remains confident of the group’s strong trading and cash generation and expects that 2020 full year adjusted earnings per share shall be no less than 11.0p.
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