Appreciate pleased with trading as it focuses on value
Appreciate Group
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16:30 27/02/23
Redemption product provider Appreciate Group said in an update on Tuesday that its overall trading remained in line with the board's expectations.
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The AIM-traded company, which was holding its annual general meeting, said it had prioritised driving profitable billings within its consumer high-street vouchers business ahead of volumes.
Its focus in the Appreciate Business Services corporate market, meanwhile, was still on improving retention levels for corporate clients while increasing the number of new clients purchasing from the firm for the first time.
That, it said, would set the group up “strongly” for its key trading period in the lead-up to Christmas.
Appreciate said its Park Christmas Savers business was trading strongly and in-line with expectations, underpinned by its highest level of agent and direct customer retention rates.
The board said the new Park Christmas Savers 2023 campaign launched earlier in September, adding that it was “confident” the channel could return to growth.
A total of 22 new partnerships were added to the Love2shop brand since the start of the financial year, and 53 exclusive value-adding offers sent to customers.
Appreciate said it was “highly seasonal” in nature, with 58% of total billings and 51% of full-year contribution made in the third quarter last year.
It expected that to be higher this financial year, as both corporate and consumer customers reassessed their spending habits and looked for better value in the lead-up to Christmas amid the cost-of-living crisis.
“Since being appointed executive chair on 1 August, the senior management team has focused on the group's costs and maximising profitability,” said executive chair Guy Parsons.
“We have already identified and implemented some immediate changes around how we communicate the savings that recipients of a Love2shop product can benefit from, evaluated net profit by channel to drive the most profitable billings, as well as ensuring that we are earning a suitable risk adjusted return from the large sums held on deposit.
“In the coming months, we will be working to accelerate the simplification of the business, which is intended to enhance earnings in the medium term.”
Parsons said he expected to make further announcements “in due course” on progress with those plans.
“Despite the challenging macroeconomic environment, our outlook remains in line with our expectations for the year ending 31 March.
“I am confident that with the leadership changes underway and a renewed focus on costs, growth, and simplification, the group can continue to prosper.”
At 0901 BST, shares in Appreciate Group were up 2.65% at 25.15p.
Reporting by Josh White at Sharecast.com.