25 March 2025

Personal Group Holdings plc

("the Company", "Personal Group" or "Group")

Preliminary Results and Final Dividend

Double-digit revenue growth with strong operational progress

41% increase in full year dividend

Personal Group Holdings Plc (AIM: PGH), the workforce benefits and health insurance provider, is pleased to announce its preliminary results for the year ended 31 December 2024.

Financial Highlights

*   Continuing Operations excludes the results of Let's Connect, which was disposed of on 9 July 2024

** Adjusted EBITDA is defined as earnings before interest, tax, depreciation, amortisation of intangible assets, goodwill impairment, share-based payment expenses, profit or loss on disposal of subsidiaries, corporate acquisition costs and restructuring costs.

Operational Highlights

Outlook

Paula Constant, Chief Executive of Personal Group, commented: "I'm incredibly pleased to be reporting on such a strong year of progress for Personal Group, delivering double-digit revenue growth and completing some major operational projects to position the Group for further growth. We have entered 2025 a stronger business with a clear plan in place to accelerate growth and capture the significant market opportunity. Our Insurance and Benefits offerings are more relevant than ever in the current climate and our results are testament to the value we provide. I'm excited about what lies ahead and in achieving our ambition to deliver in excess of £100m revenues, Group EBITDA of £30m and SaaS ARR of £20m by 2030 as we continue to pursue the significant opportunities in an underpenetrated addressable market."

Personal Group Holdings will host a webinar for analysts and investors today at 12.00pm. If you would like to register for the webinar, please follow this link: https://www.investormeetcompany.com/personal-group-holdings-plc/register-investor

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 Notes to Editors

Personal Group Holdings Plc (AIM: PGH) is a workforce benefits and health insurance provider. Its vision is to be the champion of affordable and accessible insurance and benefits, keeping businesses and their employees happy, healthy and protected. The Group is proud to support the health and wellbeing of c. 1.25 million UK employees.

The Group's insurance provides employees with access to affordable, individual policies for hospital, recovery and death benefit plans. The Group's award-winning benefits platform, Hapi, brings together extensive employee benefits, discounts and rewards, in one responsive platform. As well as being sold direct to employers, the Hapi platform supports Sage's Employee Benefits offerings for SMEs.

This comprehensive range of offerings, powerful platform and unique sales model of face-to-face, one-to-one engagement with employees, provides Personal Group with a strong market position from which to grow. 

Head-quartered in Milton Keynes, the Group has built an extensive blue-chip customer list over its 40-year history, including Airtanker, B & Q, Barchester Healthcare, British Transport Police, British Airways, Merseyrail, Office of National Statistics, Randstad, Royal Mail Group, The Royal Mint, Stagecoach Group plc, and The University of York

For further information on the Group please see www.personalgroup.com

CHAIR'S STATEMENT

The strategic initiatives that have been implemented over the last 18 months have provided a stronger platform on which to build, increasing the proportion of recurring revenue within the business, simplifying its structure and introducing increased operational rigour and integrity. As a result, the business has entered 2025 with real momentum.

The relevance of the Group's Affordable Insurance and Benefits & Rewards offerings to our customers and their employees can be seen in the growth of our customer base and high retention levels. We have seen several record insurance sales months again this year and are confident that we have room to improve upon these results further still, through continuing to refine our sales approach, expanding our product offering and engaging with additional partners.

The investment in our senior leadership team, including key strategic hires of Chief Operations Officer, Chief Sales Officer and Chief Commercial Officer, means we now have strength and depth across the organisation, and it is pleasing to see the newly formed team united by a common conviction in the growth strategy, the creation of which was a key priority for the Board.

I would like to thank the entire team for their continued dedication to supporting our customers, while delivering these strong results. Their passion for what we do is evident in the high level of customer service across the organisation, and it is their dedication and commitment that makes Personal Group the strong organisation that it is.

Strategic execution delivering strong performance

We have successfully delivered across our KPIs once again this year, achieving double-digit revenue growth from continuing operations of £43.8m (2023: £38.6m) and EBITDA growth of 29% at £10.0m (2023: £7.8m). We continue to benefit from a strong balance sheet, generating cash from operations in the year of £11.4m, increasing our cash and bank deposits position to £27.4m as at 31 December 2024 (2023: £20.1m) with no debt. Importantly, following the disposal of Let's Connect, recurring revenues continued to increase, now represent 92% of total Group revenue from continuing operations (2023: 93%).

Our Affordable Insurance division and successful face-to-face sales approach continues to be a major asset of the business, once again delivering a record performance, driven by record new sales and high retention rates.

Benefits platform revenue has also continued to grow, delivering increased levels of annual recurring revenue ("ARR") and with the migration of customers to the second generation of the platform now all but complete, the future for this division looks promising.

The contribution from Pay & Reward increased this year, supported by a significant contract win with British Airways, and the division has developed innovative digital offerings which we are now looking to roll out further.

ESG

Personal Group is a business very much guided by its purpose, and the Board remains committed to maintaining high standards of ESG, ensuring we build a strong business in a responsible way. We continue to reduce the Group's already low carbon footprint, while fostering an inclusive, progressive and diverse working environment. Our ESG metrics were incorporated into our Group bonus scheme for the first time this year, and we are delighted that all targets were achieved.

Dividend

I am pleased to announce that the Board has recommended a final ordinary dividend of 10.0 pence per share which will be paid on 14 May 2025 to members on the register as at 4 April 2025 (the record date). Shares will be marked ex-dividend on 3 April 2025. This makes a total ordinary dividend for 2024 of 16.5 pence per share, representing an increase of 41% year-on-year (2023: 11.7p).

Increased profitability across the growing business in the second half of the year as well as the net cash inflow and realisation of working capital resulting from the disposal of Let's Connect has resulted in the cash balances of the Group being significantly increased and this enhanced cash position is reflected in an increased dividend to shareholders. While the disposal of Let's Connect has contributed to this year's enhanced return, our policy remains to grow the dividend progressively in line with earnings and cash flow generation.

Confident Outlook

The successes of 2024 have continued into 2025 and we see real momentum across the business. Personal Group's high levels of recurring revenue provide high levels of visibility, and strong cash generation give the Board considerable confidence. We will continue to invest in our people and offerings to ensure we capture the significant opportunity ahead, and in doing so deliver increasing returns for our shareholders.

Martin Bennett

Non-Executive Chair
25 March 2025

GROUP CHIEF EXECUTIVE'S STATEMENT

I am excited to report on another strong financial performance by Personal Group, in my first full year as CEO, with double-digit revenue growth across all divisions. In addition, we have thoroughly underpinned our strategy and have started implementing what is required for accelerated growth in future years.

We have delivered another record year in Insurance sales, supported by our unique face-to-face sales model, increasing efficiency and effectiveness through forensic operational management and strong team engagement. We have also secured notable new client wins, including DHU Healthcare and Freshpak, and maintained high levels of customer retention across all our offerings, resulting in strong growth in our recurring revenues, providing high levels of visibility and strong cash generation. As importantly, we have significantly shortened our time to process claims and handle queries, with exemplary customer review scores and have been recognised for our dedicated approach to vulnerable customer treatments. It is clear that we offer solutions which resolutely address customer needs, with exceptional customer support.

Much work has been undertaken to strengthen and streamline the business and we have exited the year with a leaner, more capable organisation geared for further growth and ready to execute on our strategy. The successful migration of customers onto the next generation of our Benefits platform, Hapi 2.0, provides a basis for greater Benefits adoption and expansion. We have reorganised and strengthened our team, including the key strategic hires of a new Chief Operations Officer and, more recently, a Chief Sales Officer for new and existing business and a Chief Commercial Officer to grow our product portfolio and optimise our profitability. Considerable progress has been made in enhancing our data insight, risk frameworks, contract management and security to create a more robust business on which to build.

United behind a clear strategy

Crucially, the Group is now united behind clarity of ambition supported by a clear strategy, with KPIs to track progress. This strategy is informed by the extensive market research undertaken in my first year as CEO, which highlighted the strength of the Group's market positioning and key areas of opportunity.

Our strategy has four key pillars: Expansion, Innovation, Adoption and Partnering. Insurance growth will be driven by expanding within customer accounts and deepening our addressable employee base, alongside winning new clients directly and through partnerships, and expanding our insurance offering into new products and channels. Growth in Benefits & Rewards will come from the increased adoption of the Hapi platform across our Insurance customer base and expansion of our market reach, predominantly through partnerships.

Our ambition is to exit 2030 having delivered in excess of £100m revenues, group EBITDA of £30m and recurring revenues of £20m and we are confident in our ability to achieve this organically. That said, our strong balance sheet and excellent cash generation also enables us to consider complementary acquisitions that would provide additional products or expertise and accelerate growth. We are continuing to explore potential M&A activity and we remain open to acquisition opportunities that meet our criteria and we see to be strengthening to the existing business divisions.

Sales and Operational Review

The Group made strong progress across both our Affordable Insurance and Benefits & Rewards divisions, enhancing and expanding our product offerings and growing our reach through partners.

Affordable Insurance

The Group delivered another record year in Insurance sales, including another record month in September, with new annualised insurance sales increasing by 18% in the year to £13.9m. We are proud to have increased both productivity and quality through our forensic analysis of team activity and management in addition to a laser focus on the early cancellations, which reduced by 10% year-on-year.

Claims levels increased year-on-year, as anticipated, to £8.5m (2023: £6.9m). Customer retention levels remained high at over 80% year-on-year, testament to the value provided. We have invested huge efforts in improving customer service, achieving a Trustpilot score of 4.9, which we believe to be outstanding in our industry. In addition, claims processes have improved throughout the year, with the business processing more than 95% claims within 48 hours in Q4 with this standard expected to be maintained going forward. Given this strong performance, Insurance Annualised Premium Income increased 14% to £36.0m (2023: £31.6m).

2025 Insurance objectives

We are focused on increasing our penetration of new employees, particularly within our top 100 accounts, which we are dissecting in terms of visit frequency and attendance by skill. Further opportunities to improve penetration include expanding our offering into new, adjacent products associated with 'protection' and increasing our routes to market through partnerships. We have identified our Group Cash plan and digital insurance options as the first two potential avenues to thoroughly test in 2025.

Benefits & Rewards

The Group's digital benefits platform, Hapi, directly and via our SME-focused partnership with Sage, performed well and secured new clients, delivering ARR growth by 10% to £6.7m (2023: £6.1m). We improved customer churn by over 20% by further digitising processes and handoffs.

Hapi's performance was steady in the year, delivering ARR of £2.7m (2023: £2.5m), underpinned by 27 new Benefits clients won in 2024, comparable to the previous year, up 10% in average value per win year-on-year. Notable new client wins for Hapi include the Office of National Statistics, DHU Healthcare and Karbon Homes. We won a number of industry awards in the year, including Best Use of Technology in the 2024 Health and Wellbeing Awards, and Best Use of Technology in Benefits in the 2024 Workplace Savings & Benefits Awards, demonstrating the competitive strength of our platform. These, alongside the increased uptake of our Benefits offerings and Hapi's top class Trustpilot score of 4.3, are evidence of the quality of our offering.

A significant area of focus for the team in 2024 was the migration of customers onto Hapi 2.0, our next generation platform. We are delighted at the pace and the effectiveness of our migration, with the vast majority of customers (99.9%) now on the new platform. Customer feedback has been excellent, with the enhanced platform providing improved user navigation and personalisation, the reward and recognition features being strongly embraced, and the self-serve capability providing better flexibility. As importantly, consolidating code from the two platforms into one significantly reduces our operating costs into 2025.

During the year we also launched SEB 2.0 (Sage Employee Benefits), based on Hapi 2.0, and migrated all Sage customers to the next generation platform within weeks. The Group also strengthened its relationship with Sage in the year and had its best-ever month of leads in November and December, providing a strong position from which to expand into new segments and geographies in 2025.

The Group's Pay & Reward division, comprising Innecto and QCG, now consolidated as one operating group under the Innecto brand, performed well, with ARR increasing to £0.71m (2023: £0.67m). This was largely due to the significant three-year contract with British Airways signed in the first quarter, worth £650,000, contributing approximately £100,000 per annum in ARR. The contract includes reward consultancy, the implementation of Innecto's job evaluation tool and the development of a career pathway interface, which is expected to launch in 2025. The consultancy services and subsequent SaaS tools continue to serve an important strategic function.

2025 Benefits & Rewards objectives

Now that the migration onto the new platform is nearly complete, the Group has the capabilities and bandwidth to focus on accelerating growth in Benefits. We are progressing various initiatives to upsell our benefits modules to Insurance customers, including Reward and Recognition (R&R) and Transform, our wellbeing health and fitness module, and are implementing greater digital integration of our Insurance and Benefits offerings to reduce friction in the sales process.

Additionally, an important avenue for growth is via partnerships, and we are focused on increasing our leads across partners, progressing additional partnerships to target the SME market and monetising our eCommerce partnerships. We are pleased to have agreed a new consultancy partnership early in 2025, which has opportunity to and interest in expanding to benefits platform sales later in the year.

Within our Pay & Reward division, our priority is the completion of an industrialised tool for Innecto and the launch of the British Airways career pathways tool.

Passionate about our Purpose

At Personal Group, our Purpose is at our core: to keep businesses and their employees happy, healthy and protected. This includes supporting our own employees and, to that end, we have implemented 11 new employment policies, placing us ahead of other businesses our size.

To cement adherence to our ESG targets across the organisation, we have established a new Bonus Gateway to make our ESG metrics and targets a more meaningful part of renumeration for all employees, removing their inclusion from any LTIP portion. We are pleased to have achieved progress on every dimension of ESG in 2024.

Outside of the organisation, Personal Group is committed to ensuring our customers are cared for above and beyond the FCA's Consumer Duty regulations, and we have established an internal working group to deliver these requirements. Our endeavours were recognised in the year when we were awarded the Vulnerable Consumer Duty award in the inaugural Consumer Duty awards. 

Serving our communities is also integral to Personal Group's ethos, and in the year we focused our Personal Assurance Charitable Trust donations, for which we pledge at least 1% of EBITDA or a minimum of £100k each year, on charities within three main areas: employee charity of choice, customers and policy holders, and the local community. We also launched a new Volunteering Policy which is participated in across all levels of the organisation.

Outlook

Personal Group has entered 2025 a stronger, simpler business with a clear strategy in place to accelerate growth and capture the significant market opportunity. We will build on our momentum by further refining our sales processes and expanding through product innovation and new routes to market. The Group continues to benefit from a strong balance sheet and high levels of recurring revenues, providing confidence in continued growth.

Paula Constant

Group Chief Executive

25 March 2025

CHIEF FINANCIAL OFFICER'S STATEMENT

Group revenue

Group revenue from continuing operations grew 13% to £43.8m (2023: £38.6m).

A strong performance in our Insurance segment, driven by another record year of new policies written, resulted in growth of the insurance book to £36.0m Annualised Premium Income (API) (2023 £31.6m), the majority of which continues to renew on weekly or monthly rolling contracts.

In line with our strategy, our previously separate Benefits Platform, and Pay and Reward, segments have been combined to form one new "Benefits & Reward" segment. Income in this segment increased to £10.2m for the year (2023: £8.9m) with growth arising from both SaaS and Consultancy income.

Other income increased to £1.4m (2023: £1.0m) as a result of further leveraging the increased cash deposits held by the insurance subsidiaries.

The Group continues to build its recurring revenues across all business lines, with over 90% of reported revenue from continuing operations for 2024 deriving from one of these sources, providing confidence and visibility as we enter 2025.

Adjusted EBITDA

Adjusted EBITDA from continuing operations for the year grew 29% to £10.0m (2023: £7.8m) following increases in contribution from the insurance segment, where underwriting profit continued to deliver strong margins while growing in line with the size of the insurance book. The ongoing value of our insurance proposition to our policyholders can be seen in the upturn in our claims ratio to 29.1% (2023: 27.0%) as NHS activity increased throughout 2024.

The Benefits & Reward segment also continued to drive growth in EBITDA, with contribution up 20% to £5.2m (2023: £4.3m), driven by new platform sales in both Hapi and Sage Employee Benefits, our white-labelled product, as well as a strong performance across consultancy and digital reward platform sales.

Outside of the core segments, Group administration and central costs increased year-on-year reflecting inflationary wage and operating expense increases.

We continue to believe that adjusted EBITDA remains the most appropriate measure of performance for our business, reflecting the underlying profitability of the business and removing the impact of one-off items arising from past acquisitions on the Group's reported profit before tax. The definition remains unchanged from previous years.

Profit before and after tax

Statutory profit before tax from continuing operations for the year was £6.8m (2023: £5.1m), which includes £0.3m of restructuring costs across the Group. The tax charge for the year was £1.3m (2023: £0.9m), and profit after tax for the year £5.5m (2023: £4.2m).

Discontinued operations

Profit from discontinued operations of £1.0m (2023: £0.1m) represents the total after tax profits relating to Let's Connect which was disposed of during the year, including a £1.2m profit on disposal. Let's Connect was a seasonal business therefore selling the business mid-year left the Group with an in-year loss from activity to the date of sale.

EPS

Resulting earnings per share were up 32% to 17.7p (2023: 13.4p) from continuing operations. The calculation is detailed in Note 3.

Dividend

The Board has recommended a final ordinary dividend of 10.0 pence per share, making a total ordinary dividend for 2024 of 16.5 pence per share. The Board has considered the level of dividend in the context of both the underlying growth seen during the year and the increased in-year profit and cash realisation as a result of the disposal of Let's Connect, alongside continued confidence in the Group's business model and prospects. While the disposal of Let's Connect has contributed to this year's enhanced return, our policy remains to grow the dividend progressively in line with earnings and cash flow generation.

Balance sheet

As at 31 December 2024, the Group's balance sheet remained strong with cash and bank deposits of £27.4m (2023: £20.1m) and no debt. The Group's primary underwriting subsidiary, Personal Assurance Plc (PA), continues to maintain a conservative solvency ratio of 279% (unaudited), with a £7.6m surplus over its Solvency Capital Requirement of £4.3m. The Company has consistently maintained a prudent position in relation to its Solvency UK requirement. Personal Assurance (Guernsey) Limited, the Group's subsidiary which underwrites the death benefit policy, also maintained a healthy solvency ratio of 544% (unaudited), with a £3.6m surplus under its own regime.

Cash Flow

Cash generation is a key quality of the business and the business generated £11.4m in cash from operations in 2024 (2023: £6.7m). This has been particularly high in the year following the realisation of opening working capital in Let's Connect (c. £2.8m) prior to its disposal in July. Underlying cash generation remains strong.

With capital required of currently c.£10m to support insurance business and working capital, there is opportunity to invest to deliver the Group's business plans including product developments and enhancements as well as increasing the return to shareholders via an increased dividend and selectively considering earnings enhancing acquisitions that will enable acceleration of growth.

Segmental results

The Group reports across two core segments as detailed in the table above.

For each of the segments, the adjusted EBITDA contribution comprises the gross profit of that segment together with any costs associated directly with the operation of that segment. Sales and marketing costs and other central costs that are not directly attributable to a segment, such as Finance, HR, depreciation, amortisation and Group Board expenses are not allocated to a segment and are shown separately as 'Group Admin and Central Costs'.

We believe this presentation provides transparency to enable the impact of top line growth on adjusted EBITDA contribution for each area of the business to be better understood.

Affordable insurance

Insurance revenue from the Group's core insurance business grew 12% to £32.2m (2023: £28.7m).

The continued success of our face-to-face sales activity, which directly engages employees with their employers' benefit provision, resulted in a second successive record year for new insurance sales, with £13.8m written (2023: £11.8m). The combination of these new sales alongside continued strong retention rates means that, as at 31 December 2024, we had £36.0m (2023: £31.6m) of Annualised Premium Income, and over 100,00 insurance payers.

The claims ratio for the year increased to 29.1% (2023: 27.0%), in line with general increased NHS activity across the UK.

Adjusted EBITDA contribution of £12.4m for the year (2022: £11.2m), reflected the increased underlying profit arising from increased revenue despite the increase in claims activity.

Benefits & Reward

Revenue from digital platform subscriptions and commissions from third party benefit suppliers which sit on the benefits platform rose 16% to £7.8m in 2024 (2023: £6.7m).

Subscriptions for our enterprise platform, Hapi, continued to build with ARR on the platform increasing to £2.7m (2023: £2.5m) with 27 new clients won during the year.

Our footprint in the SME market further widened with Sage Employee Benefits, the Group's SME proposition being taken to market through its partner Sage. ARR here increased to £4.1m at the end of the year (2023: £3.7m).

We delivered our largest ever reward consultancy project during 2024 and drove further growth in digital subscription income from proprietary HR solutions to £0.7m (2023: £0.6m). The operational merger of our Innecto and QCG businesses in the latter stages of 2023 also drove efficiencies in both delivery effort and costs through 2024.

Adjusted EBITDA contribution of £5.2m (2023: £4.3m) demonstrates the continued development in this segment and serves as a reminder of the opportunity for growth on which the Group plans to capitalise.

Group administration expenses and central costs

Group administration and central costs of £8.9m (2023: £8.7m) reflects inflationary cost increases associated with salaries, corporate and fleet insurances, IT delivery and other services.

Sarah Mace

Chief Financial Officer
25 March 2025