Equiniti Group plc
Incorporated in England and Wales
Registration number: 07090427
19 November 2019
EQUINITI GROUP PLC - TRADING UPDATE
Equiniti Group plc ("Equiniti" or "the Group"), an international technology-led services and payments specialist, today issues the following trading update for the period 1 July 2019 to 18 November 2019.
The Group's performance in the period has been reassuring and we expect 2019 full year results to be towards the upper end of market expectations* for revenue and towards the lower end for underlying EBITDA due to weaker higher margin UK corporate activity.
Client retention remained strong across the Group and we have continued or extended all relationships including ALLETE Inc., BT, Centrica, Fidelity and Hewlett Packard Enterprise. New client wins have also been encouraging and we are pleased to have secured new clients across all of our divisions. Investment Solutions continued to take market share with new share register wins including Marshall of Cambridge and Vitec Group. Remediation services and software sales remain the drivers of growth in Intelligent Solutions with software sales to DXC, MBNA and Yorkshire Building Society. Pension Solutions secured client wins in the period including a significant pension administration contract and, with the cost efficiency actions completed in the first half, underlying EBITDA in Pension Solutions is expected to stabilise for full year 2019. EQ US continued to build upon the momentum in the prior period with further success in cross-selling new products into the client base, most notably equity compensation services to BT's US employee base, Dorman Products and Johnson Outdoors.
After completion of the US separation in the first half of 2019, there are no further non-operating charges in the second half of the year. Operating cash conversion is expected to be comparable to that of the first half of the year with leverage at or slightly above the higher end of the range of market expectations due to timing of business in the fourth quarter. Our medium term guidance remains at c.95% operating cash flow conversion.
Whilst we expect the uncertainty in the macro environment to continue, Equiniti remains well positioned. We expect further organic growth in the UK as we build on our relationships with our exceptional client base. The US offers a platform for accelerated growth based on market opportunity, the potential to take market share and the opportunity to cross-sell digitised services into our blue-chip client base.
Equiniti's business model gives us good forward visibility of revenues. Our operations are scalable with platform characteristics, and actions undertaken in the first half will serve to increase efficiency and reduce marginal costs. This, along with progressive deleveraging and further operational improvements, will allow us to grow underlying profits and earnings ahead of revenue.
2019 market expectations*
Revenue : £550 - £567m
Underlying EBITDA : £136 - £142m
Leverage : 2.3 - 2.5x
*Source: Company Compiled; post IFRS 16
12 March 2020 Full year results announcement
7 May 2020 AGM and trading update
30 July 2020 Interim results announcement
For further information please contact:
Equiniti Group plc Guy Wakeley, Chief Executive +44 (0) 207 469 1811
John Stier, Chief Financial Officer
Frances Gibbons, Head of Investor Relations
Temple Bar Advisory Alex Child-Villiers + 44 (0) 7795 425580
Will Barker + 44 (0) 7827 960151
This announcement contains forward-looking statements regarding Equiniti. These forward-looking statements are based on current information and expectations, and are subject to risks and uncertainties, including market conditions and other factors outside of Equiniti's control. Readers are cautioned not to place undue reliance on the forward-looking statements contained herein, which speak only as of the date hereof. Equiniti undertakes no obligation to publicly update any forward-looking statement contained in this release, whether as a result of new information, future developments or otherwise, except as may be required by law.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
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Market Cap: £749.49 m
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