Momentum continues across divisions at Park Group

Investors in Park Group were told of continuing momentum in the current financial year after a strong set of 2017 results on Thursday, at the company’s annual general meeting being held in Wirral.

The AIM-traded firm had published “strong” results for the year to 1 March in June, and at the time its board reported that the 2018 year had started well, giving it confidence in delivering “another strong performance”.

Chairman Laura Carstensen said at Thursday’s AGM that the company had continued on that trajectory in both its corporate and consumer-facing divisions.

“Our corporate business, Love2shop Business Services, supplies an extensive range of gift cards, vouchers, digital reward and incentivisation products to some 31,000 organisations,” Carstensen explained.

“Last year's progress has been maintained with continuing growth driven by ongoing product enhancement and innovation.”

'Evolve,' Park Group’s new digital reward platform launched in 2016, continued to be adopted by large blue-chip brands and small to medium-sized enterprises alike, Carstensen claimed.

A total of 211 client organisations now used the portal - up from 165 clients three months ago.

“Building on this success, we have developed the 'Evolve' proposition even further by adding an international capability.

“In June, Love2shop Worldwide was launched, an innovative product allowing Park to provide its reward, recognition and benefits services to the global employee and customer engagement markets,” Carstensen said.

“This has proved especially attractive to international organisations with customers, offices and subsidiaries overseas.”

A total of 15 corporate clients were already using Love2shop Worldwide, and the board said there was a “pleasing pipeline” of potential new customers.

Park Group’s consumer division enabled customers to plan for Christmas in a “controlled and structured” way,” Carstensen explained.

Customers made regular payments over a 45 week period, and received their gift vouchers, gift cards or gifts in time for the festive season.

“This division continues to perform well, with customer numbers and average order values ahead and an order book running more than four per cent above the same period last year.”

As part of the company’s commitment to ongoing product development and “excellent customer service”, in January it launched a mobile application for its Christmas savings customers, which the board said reflected their preference for that means of communication.

“The app is proving very popular and the feedback we receive from customers allows us to further improve its appeal and functionality,” Carstensen said.

“We will continue to develop and enhance the app to the benefit of customers and subsequently, Park itself.”

The company’s relationship with Mastercard also continued to strengthen, according to the chairman, and in January it became a licensed issuer of Mastercard prepaid cards.

“This was an important strategic development and the first product to be offered was a digital card, issued to customers for online use at a select number of retail outlets including John Lewis and Argos.

“As planned, we have now extended this offering to include both digital and physical cards which can be used at any retailer accepting Mastercards, both in-store and online, across the UK and in Ireland.”

On its outlook, Carstensen said Park is a cash generative business with a “strong, debt-free” balance sheet.

Total cash balances were reportedly continuing to increase, and were again ahead of the same period last year.

“This progress is significant as it highlights the growth in our order books, principally for the consumer business, where orders are booked in the first half of the year for dispatch in the second half, in time for the festive season.”

The seasonality of Park's business meant that the majority of orders were delivered in the final quarter of each calendar year, Carstensen explained.

Park was approaching its busiest period with “robust systems” and a “proven track record” in order execution.

“Our order books continue to grow and our commitment to excellent customer service gives us a loyal and expanding customer base.

“Trading is in line with expectations and we look forward to the future with confidence.”