Xafinity PLC (LON:XAF), the pensions actuarial, consulting and administration business, has today announced its interim results for the six months ended 30 September 2017.
Financial Highlights:
|
H1 2018 |
H1 2017 |
% change |
Revenue |
£ 26.6m |
£26.0m |
2 |
Adjusted EBITDA |
£ 8.7m |
£8.5m |
2 |
Pre-tax profit |
£ 4.9m |
£1.7m |
188 |
Basic earnings per share |
2.9p |
1.0p |
190 |
· Revenue for HY18 of £26.6m, a 2% increase when compared with the prior year (HY17: £26.0m)
· Adjusted EBITDA grew by 2% to £8.7m (HY17: £8.5m), representing a margin of 32.7%
· Pre-tax profit increased by an impressive 188% to £4.9m (HY17: £1.7m)
· Strong cash conversion in H1 2018 of 75%
· Basic earnings per share of 2.9p (HY17: 1.0p) following IPO share reorganisation
· Interim dividend of 2.1p per share declared by the Board
Operational Highlights:
· The Company has added 5 more annuity client wins in the six months ended 30 September 2017
· Introduction of Radar technology to 40 clients since beginning of financial year
· Xafinity fully supports the CMA investigation into the investment consultancy sector, and is looking forward to assisting the regulator as the investigation progresses
· Performance since 30 September 2017 has remained in line with the Board’s expectations and the revenue associated with recent contract wins is expected to feed through over the remainder of this financial year
Proposed Acquisition of Punter Southall divisions
Xafinity today announced a proposed acquisition of Punter Southall Holdings Limited, the holding company of the actuarial consulting, pensions administration and investment consulting businesses of Punter Southall Group Limited (“PS Group”), for up to approximately £153 million. The deal would combine the three target businesses with Xafinity’s existing businesses, whilst Xafinity’s HR Trustees business would be sold to PS Group. The addition of these complementary divisions to the Xafinity group is anticipated to enable the enlarged group to become the largest “pure play” pensions consulting firm in the UK outside of the global consultancies.
Ben Bramhall, co-CEO of Xafinity plc, commented:
“The Company’s performance since 31 March 2017 has been pleasing, and I would like to thank all of our employees for their hard work as the business continues to build momentum as a publicly listed company. We remain committed to investing in people and technology, as seen by the roll-out this year of our market leading product, “Radar”, which has been positively received both by our new and retained clients.”
“The investment consultancy industry is currently undergoing a period of increasing scrutiny from the CMA, and we fully support the regulators decision to explore ways in which the industry can work more effectively. We believe this investigation will be hugely beneficial to pension schemes and trustees, and we look forward to sharing our recommendations with the CMA on how the industry can improve.”
Paul Cuff, co-CEO of Xafinity plc, commented:
“The announcement today regarding the transaction with Punter Southall is very exciting news for everyone at Xafinity, and it follows a successful period for the Company built on the back of a series of impressive client wins. We have a very clear strategy to build market share in the pensions advisory space, and the merger of these three divisions from PS Group with Xafinity will enable us to achieve our aim of becoming the clear alternative to the Big Three in the pensions consultancy sector. The trading environment for Xafinity remains strong, while the pipeline of new business continues to offer real growth opportunities, and we look forward to the rest of the year with confidence.”