Release Date: July 21, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Mony Group PLC (STU:39M, Financial) achieved financial and strategic milestones, helping UK households save an estimated GBP1.4 billion.
- Revenue grew by 1% to GBP225 million, and adjusted EBITDA increased by 2% to GBP75 million, demonstrating resilient financial performance.
- The company expanded its member base by 0.5 million since February, bringing the total to over 1.5 million members.
- Mony Group PLC saw 11% growth in provider offerings and scaled its B2B partnerships to 34, with over 100 providers signed up for its market foods data product.
- The company plans to deliver GBP96 million in shareholder returns over 2025, including increased ordinary dividends and a GBP30 million share buyback program.
Negative Points
- The margin of incremental transactions decreased from GBP79 million to GBP75 million, indicating potential pressure on profitability.
- Energy segment revenues peaked in February and have since declined, with ongoing regulatory impacts such as the price cap and ban on acquisition tariffs.
- PPC costs increased by 20% year over year, driven by competitor behavior, impacting marketing margins.
- Gross profit margin declined from 68% to 66%, affected by first purchase rewards, PPC costs, and growth in the B2B business.
- The company experienced a timing and mix effect in working capital, with slower cash conversion in energy and life segments compared to faster cycles in other areas.
Q & A Highlights
Q: Can you clarify if you are happy with the midpoint of consensus expectations for this year, around GBP144 million EBITDA?
A: Yes, we are happy with the midpoint of consensus expectations for this year. (Peter Duffy, CEO)
Q: How has the energy segment performed since the price cap activity, and is this improvement sustainable into the second half of the year?
A: Average sales are up about 40% from the peak of energy in 1920, but savings are only about 10% today due to regulation. We expect the market to gradually come back, with significant switching activity around price cap movements. (Peter Duffy, CEO)
Q: What is driving the increase in PPC rates, and how does this affect your marketing margin?
A: PPC costs are up 20% year over year, largely due to competitor behavior. Our long-term strategy is to reduce reliance on paid media by growing clubs and focusing on profitable growth. (Niall Mcbride, CFO)
Q: Can you explain the dynamics of the outflow of receivables in the first half and how we should think about working capital for the year?
A: The cash conversion in this half isn't much different from '23. The timing and mix effect is specific to the half, with a shift from faster cash conversion segments like char to slower ones like energy and life. Overall, cash generation remains strong. (Niall Mcbride, CFO)
Q: Could you provide more color on the people cost reduction?
A: We've removed about 50% of legacy code, improving productivity and allowing us to take cost savings or efficiency gains. This is part of a new way of working, with a 300% improvement in tech team productivity over the years. (Niall Mcbride, CFO)
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
