RESULTS ANNOUNCEMENT FOR THE YEAR ENDED 30 APRIL 2023
FY23 results demonstrate resilient profitability and robust cash generation
Summary financial results
| Year ended 30 April 2023 | Year ended 30 April 2022 | Year-on-year growth % |
Group revenue (£m) | 320.1 | 304.3 | 5.2% |
Gross profit (£m) | 179.7 | 150.1 | 19.7% |
Gross margin (%) | 56.1% | 49.3% | 6.8%pts |
Adjusted EBITDA (£m)1 | 84.2 | 74.9 | 12.4% |
Adjusted EBITDA margin (%)1 | 26.3% | 24.6% | 1.7%pts |
Reported profit before taxation (£m) | 34.9 | 40.0 | (12.6%) |
Adjusted profit before taxation (£m)1 | 48.0 | 51.5 | (6.9%) |
Basic earnings per share (pence) | 7.8 | 9.3 | (15.6%) |
1. Before adjusting items of £13.1m in FY23 and £11.6m in FY22. See Adjusting Items at Note 5 and definition of Alternative Performance Measures below.
Results summary
- Revenue growth of 5.2% year-on-year to £320.1m.
- Adjusted EBITDA growth to £84.2m (FY22: £74.9m) with Adjusted EBITDA margin increased to 26.3% (FY22: 24.6%).
- Adjusted Profit before Taxation of £48.0m (FY22: £51.5m).
- Net debt to pro forma Adjusted EBITDA decreased to 1.97x as at 30 April 2023 from 2.45x as at 31 October 2022.
Strategic and operational highlights
A milestone year establishing key capabilities to drive future growth:
- Scaled our technology team to 250 (April 2022: 195) roles and transitioned from re-platforming to a focus on initiatives that are delivering new features for our customers.
- Opened new operational facilities in Almere, Netherlands, and Tamworth, UK.
- Continued customer acquisition across our brands, with revenue from new customers at Moonpig and Greetz of £31.7m, remaining ahead of pre-pandemic levels (FY19: £23.9m).
- Delivered significant operational improvements at Experiences, including appointing a new leadership team and investing in the technology platform.
Resilient profitability through the economic cycle:
- Our business model’s inherent flexibility enabled us to deliver Adjusted EBITDA in line with expectations despite the challenging economic context from October 2022 onwards.
- Adjusted EBITDA for Moonpig and Greetz was £71.2m (FY22: £74.9m), surpassing the level implied by pre-IPO guidance.
- Resilience is rooted in the stability of the greeting cards market and in our loyal customer cohorts, with 88.6% of Moonpig and Greetz revenue from existing customers (FY22: 86.5%). It is bolstered by our proprietary data, with 84m occasion reminders (April 2022: 72m).
- Experiences revenue grew year-on-year, albeit more slowly in the second half of the year in light of the macroeconomic environment.
Strong cash generation:
- Operating cash inflow of £56.2m (FY22: £59.6m).
- Continued deleveraging, with net debt to pro forma Adjusted EBITDA decreasing to 1.97x as at 30 April 2023 from 2.45x as at 31 October 2022.
- Significant liquidity headroom and covenant against £255.0m senior debt facilities, committed until 8 December 2025.
- Floating interest rate exposure hedged for broadly three quarters of expected senior debt (less cash) until 30 November 2024.
Focus on digital innovation to drive growth:
- Full launch of Moonpig Plus, our low-cost, affordable subscription service.
- Innovation to differentiate and elevate Moonpig cards:
- Video messages rolled out across the card range, with over 75,000 messages sent by Father’s Day 2023.
- Ability to use digital codes for gift experiences in Moonpig cards.
- Ability to add stickers and photos to the inside of Moonpig and Greetz cards.
- New functionality for Moonpig group cards, providing opportunity to convert message contributors into future customers.
- Recommended gift bundles and gift cross-sell at the basket stage of the customer journey at Moonpig.
- Developed new iOS and Android apps for Greetz.
- New recommendation algorithms tailored to Dutch customer preferences to drive gift attachment at Greetz.
- Commenced building a new content management system and on-site search at Experiences ahead of roll-out in FY24.
Outlook
Trading since the start of the year has been in line with our expectations. In the context of the current macroeconomic environment, we expect pro forma revenue to grow at a low single digit percentage rate in the first half of FY24, underpinned by the Moonpig brand, which has been in growth since March.
For the full financial year, we expect consolidated revenue growth at a mid to high single digit percentage rate, with all of our brands returning to growth in the second half. Adjusted EBITDA margin is expected to remain resilient.
Nickyl Raithatha, CEO, commented:
"Today’s results demonstrate the resilience of our business model which is rooted in the stability of the greeting cards market and our unique use of data to drive customer loyalty. We have high profitability, strong cash generation and inherent flexibility that allows us to respond rapidly to a dynamic macroeconomic environment.
We are innovating to differentiate and elevate Moonpig cards with embedded video messages, personalised content and the ability to include a gift experience within the card. We have continued to extend our market leadership in online cards and we expect to return to growth during the year ahead, underpinned by our continued investments in our technology, marketing and operational capabilities. As the clear online leader in greetings cards, Moonpig Group is well positioned to benefit from the long-term structural market shift to online."
Investor and analyst meeting
The full year results presentation will be available on the Investor Relations section of Moonpig Group's corporate website (www.moonpig.group/investors) shortly after 7:00am on 29 June 2023.
Nickyl Raithatha (CEO) and Andy MacKinnon (CFO) will host a Q&A for analysts and investors via webcast at 9:30am. Please note that the presentation will not be repeated during the webcast. Analysts wishing to register for the event should email investors@moonpig.com.
Investors wishing to join the Q&A should register via the following link: https://www.lsegissuerservices.com/spark/MoonpigGroup/events/9aa6b9a3-02dd-477f-a830-bcd687826fa3
Enquiries:
Brunswick Group
Sarah West, Fiona Micallef-Eynaud, Sofie Brewis
+44 20 7404 5959
moonpig@brunswickgroup.com
Moonpig Group
Nickyl Raithatha, Chief Executive Officer
Andy MacKinnon, Chief Financial Officer
investors@moonpig.com
pressoffice@moonpig.com
About Moonpig Group:
Moonpig Group plc (the "Group") is a leading online greeting cards and gifting platform, comprising the Moonpig, Red Letter Days and Buyagift brands in the UK and the Greetz brand in the Netherlands. The Group's leading customer proposition includes an extensive range of cards, a curated range of gifts, personalisation features and next day delivery offering.
The Group offers its products through its proprietary technology platforms and apps, which utilise unique data science capabilities designed by the Group to optimise and personalise the customer experience and provide scalability. Learn more at https://www.moonpig.group/.
Forward Looking Statements:
This announcement contains certain forward-looking statements with respect to the financial condition, results or operation and businesses of Moonpig Group plc. Such statements and forecasts by their nature involve risks and uncertainty because they relate to future events and circumstances. There are a number of other factors that may cause actual results, performance or achievements, or industry results to be materially different from those projected in the forward-looking statements.
These factors include general economic and business conditions; changes in technology; timing or delay in signing, commencement, implementation and performance of programmes, or the delivery of products or services under them; industry; relationships with customers; competition and ability to attract personnel. You are cautioned not to rely on these forward-looking statements, which speak only as of the date of this announcement. We undertake no obligation to update or revise any forward-looking statements to reflect any change in our expectations or any change in events, conditions or circumstances.