TIDMTENG
RNS Number : 4763M
Ten Lifestyle Group PLC
30 April 2018
Ten Lifestyle Group plc
("Ten" or the "Company")
Trading Update and Notice of Half-Year Results
Ten Lifestyle Group plc (AIM: TENG), a leading
technology-enabled lifestyle and travel platform for the world's
wealthy and mass affluent, provides an update on trading ahead of
the Company's half-year results for the six months ended 28
February 2018, to be released on Tuesday 15 May 2018.
Since the end of the Company's financial year ended 31 August
2017, Ten has increased its number of sizeable contracts with
corporate clients from 15 to 27. This is made up of 21 Medium and 6
Large contracts(1) which includes the recently announced new
contract win with HSBC Group. This compares to the year ended 31
August 2017 when Ten had 11 Medium contracts and 4 Large contracts.
In addition, Ten anticipates at least two further Medium contracts
before the financial year ending 31 August 2018. This momentum
continues the strong competitive win rate of recent years and,
management believes, reflects the differentiation and appeal of
Ten's customer service proposition as well as the Company's new
proprietary technology platform.
However, the Board now expects net revenues for the financial
years ending 31 August 2018 and 2019 to be approximately GBP6
million and GBP10 million below previous expectations,
respectively, for the following reasons:
- The length of time between a contract tender, win and
commencement of net revenue earning activity has been longer than
anticipated and in some instances the volume of activity on new
wins has taken longer than expected to achieve anticipated levels.
This is expected to result in the deferral of net revenues in 2018
and in some instances into 2019;
- Whilst there can be no certainty of this, two new Large
contracts and four new Medium contracts that were expected in
FY2018 are now expected in FY2019;
- One existing contract in the Americas has not grown as
anticipated and, whilst that growth is still expected, which would
result in it becoming a Large contract, the timing at present is
not certain; and,
- A significant global tender that Ten anticipated winning in H2
FY2018 is now unlikely to be won by Ten. This will have a material
impact on 2019 expectations for net revenue and earnings before
interest, tax and amortisation ("EBITA").
It is currently anticipated that the Company's EBITA losses in
FY2018 will be materially less than previous expectations,
notwithstanding the anticipated lower net revenues described above.
This reflects better operational efficiency across the whole
business than had previously been anticipated as well as the timing
and efficiency of investment into new verticals. Accordingly,
management also expects the cash balance to be higher at the end of
FY2018 than previously expected.
In addition to the reduction in net revenues for FY2019, some of
the investment into new verticals that was not deployed in FY2018
will now be made in FY2019. Accordingly, profitability in FY2019
will be lower than previous expectations.
Pipeline and Competitive Positioning
The Board believes that the current new business pipeline is
stronger and more robust than at the time of the IPO, despite not
winning the tender in the Americas. The Board, therefore, remains
confident in the Group's strong growth potential which is further
underpinned by its strengthening competitive position, its
differentiated proposition, as reflected in record member
satisfaction ratings, and its market leading technology
platform.
Half-Year Results
The Company expects to announce its first half-year results, for
the six months ended 28 February 2018, on Tuesday 15 May 2018. The
half-year results will show net revenues modestly increased from
the prior period last year.
The Company will be hosting an analyst presentation to accompany
the half-yearly results on Tuesday 15 May 2018. If you would like
to attend, please email tengroup@tavistock.co.uk.
Alex Cheatle, CEO, Ten Lifestyle Group plc, said:
"We are disappointed to announce this reduction in expected net
revenues. With the exception of the unsuccessful tender for a large
potential contract in the Americas, where we were not prepared to
compete on price, most of the reduction is due to deferral of
business rather than loss of business or tenders. We believe that
Ten's customer and competitive proposition has strengthened over
the recent months and we are as convinced as ever about the
significant market opportunity and Ten's growth potential within
that market as well as our ability to generate value for our
shareholders."
(1) Ten classifies its contracts as Large, Medium and Small:
Large contracts are where the annual value of net revenue is
expected to be over GBP2 million. Medium contracts are where the
annual net revenues are expected to be between GBP250,000 and GBP2
million and a Small contract is where the annual value of net
revenue is expected to be below GBP250,000.
- End -
For further information, please contact:
Ten Lifestyle Group Plc via Tavistock
Alex Cheatle, Chief Executive Officer
Sean Hegarty, Chief Financial Officer
Jefferies International Limited +44 (0) 20 7029 8000
Nominated Advisor
Simon Hardy
Christopher Binks
Tavistock +44 (0) 20 7920 3150
Jos Simson
Simon Hudson
Sophie Praill
Notes to Editors
Ten Lifestyle Group Plc, founded in 1998, is a leading,
technology-enabled lifestyle and travel platform, providing trusted
concierge services to its members around the clock, 365 days a
year. The Group currently has a headcount of over 750 staff around
the world and is listed on the AIM market of the London Stock
Exchange.
Ten assists its members to discover, organise and book travel,
dining and live entertainment; seeking to save them both time and
money. Through Ten's service proposition, members can achieve
superior access, experiences and outcomes, more cost-effectively
and conveniently than they could have achieved on their own.
Across the business, Ten manages and provides its personalised
service to more than 1.6 million registered private and corporate
individuals on behalf of over 40 organisations.
Ten is headquartered in London, with offices in 20 locations
globally serving its growing global network of members.
For further information about Ten Lifestyle Group Plc, please go
to: https://www.tengroup.com/.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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