Moneysupermarket Q3 revenues hit by Covid-19 crisis
Price comparison website Moneysupermarket.com posted a decline in third-quarter revenue on Thursday as the Covid-19 pandemic affected several of its channels.
In the three months to 30 September, revenue fell 16% to £85.1m, with revenue in the nine months to the end of September down 11% to £268.4m.
In the money business, revenue was down 40% in the third quarter to £12.5m, while the insurance segment saw an 8% decline to £45.7m. Home services revenue was 13% lower in Q3 at £15.5m, with other revenue down 9% at £11.5m.
Moneysupermarket said the performance of the insurance business was consistent through the quarter and slightly ahead of June, with the motor segment continuing its "strong" performance, although home and life declined year-on-year and travel insurance revenue remained "negligible".
Trading dynamics in Money were similar to the second quarter, with tightened lending criteria and low product availability in banking leading to a weak performance.
Home services grew in July, the company said, mainly due to a strong energy performance on MSE. However, revenue growth began to slow as the quarter progressed.
"The energy price cap fell as expected, while wholesale prices rose. As a result, the level of savings available to customers fell sharply, and energy market switching reduced substantially," it said.
Chief executive officer Peter Duffy said: "Our markets continue to be impacted by Covid-19, which is affecting our current performance. However, the group benefits from strong brands and high levels of cash conversion, so we are well positioned to weather this period of economic uncertainty and deliver future growth."
At 1055 BST, the shares were down 5.8% at 251.40p.
Broker Liberum cut its price target on the shares to 335p from 355p after the results, which it said were behind its expectations "due to multiple headwinds in their serviced markets".
"Covid restrictions continue to affect the travel business while fewer deals and credit tightening provided headwinds in the Money segment. The shorter-term outlook for the group remains broadly unchanged, with momentum in motor slowing, but we remain positive on the group on a longer-term outlook. Headwinds in the group will unwind over time, and we remain excited on the opportunity presented by automated energy switching."
Liberum rates the stock at 'buy'.