PensionBee in expansion phase – Investors’ Chronicle

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  • Rising marketing and workforce costs
  • Profitability target by 2023

At this stage of its development, PensionBee’s (PBEE) financial performance is of secondary importance to its conquest of the market, especially since the online retirement provider has given itself a few years to become profitable. Nonetheless, revenue more than doubled in the first half of 2021, and if you discount the marketing costs, the negative cash profit margin declined from 45% to 28% – an improvement of sorts.

The company raised £ 55million on the high-growth segment of the London Stock Exchange in April this year, although cash profits contracted as staff and marketing expenses skyrocketed early in the year. expansion phase. The workforce has grown to 151 full-time employees from 99 at the end of June 2020. And there has also been an increase in costs related to share-based payments, in particular the accelerated vesting of options.

The increase in capital demands is understandable, but the new business volumes are more illuminating. Assets under management grew 117 percent from the 2020 mid-range mark to £ 1.99 billion, helped by a stable retention rate of 95 percent. The number of clients invested increased 81% to 92,000, but the pro-rated costs were on the rise, so any advantages of scale were wiped out by the costs of expanding the business.

It’s still early days, so we can expect further investment in marketing, coupled with the rollout of new features on the technology platform, tempered by a disciplined approach to customer acquisition costs, according to management. Bosses expect high double-digit income growth for the remainder of the year, but there is still a significant “blue sky” element to these types of market disruptors. So if you’ve ever bought stocks, you might as well stay invested. Socket.

Last seen IC: Hold, 168p, Jul 22, 2021

PENSIONBEE (PBEE)
ORDER PRICE: 148p MARKET VALUE: £ 326 million
TO TOUCH: 147-151p UP TO 12 MONTHS: 170p LOW: 149p
DIVIDEND RETURN: NIL P / E RATIO: N / A
NET ASSET VALUE: 24p NET CASH : £ 55million
Semester on June 30 Turnover (£ m) Profit before tax (£ m) Earnings per share (p) Dividend per share (p)
2020 2.59 -5.22 n / A nothing
2021 5.40 -12.8 -6.54 nothing
% cash +109
Ex-div:
Payment:

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