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Personal Group revenues held back by delays in Royal Mail offering
Employee services provider Personal Group witnessed revenues drop in its most recent trading year as a delayed roll out of its salary sacrifice offering to Royal Mail and other key customers impacted the firm's cash flow.
Revenue from continuing operations fell 15.6% to £45.2m as a result of the Let's Connect product being pushed back to 2018.
However, Personal highlighted that the eventual roll-out came with a stronger offer at a reduced cost base after the initial delay, leading management to believe that current year would be "an important year of growth".
EBITDA from continuing operations remained broadly flat, down to £10.8m from its £11.4m showing a year earlier.
A fifth successive year of record new insurance sales and a 77% growth in software-as-a-service revenue to £2.7m helped the group boost its balance sheet 28.5% to £16.2m.
Directors upped the dividend 3.2% to 22.7p.
Mark Scanlon, chief executive of Personal Group, said, "2017 was a strong year across much of the group's operations, which is reflected in the EBITDA of £10.8m which was marginally ahead of current market expectations. This performance again demonstrates the strength of the underlying business and was despite the transient issue of the HMRC review into Salary Sacrifice, which delayed sales at our PG Let's Connect business into 2018."
"As we continue in the current financial year, the company is better placed than ever to realise the significant opportunity presented by the employee services market, which is being driven by increasing competition for staff in a tight labour market and recognition of the commercial value of investing in and retaining staff. This issue is common to organisations big and small, public and private all of which we are now very able to serve," he added.
As of 1420 GMT, shares had gained 3.93% to 391.80p.