- Revenue up 12% and EBITDA up 14%
- ‘Exceptional’ trading in insurance
- Tougher comparisons this year
Price comparison website Moneysupermarket.com (MONY) reached a milestone last year, posting record revenue despite an almost complete lack of energy switching on the platform.
However, the suggestion that comparisons in the insurance market would get tougher as the year progresses took the steam out of the early rally in the shares, which opened up 2% at 255p but eased back to trade down 1% at 249p by mid-morning.
RECORD-BREAKING YEAR
The switching website generated its best-ever turnover of £432 million in 2023, an 11% increase on 2022, thanks to ‘exceptional’ trading in its insurance specialism as customers sought out cheaper policies.
Revenue from the insurance business alone jumped 28% to £220 million, accounting for more than half of the group total, as ‘exceptionally high premium inflation continued, driving high search traffic in the quarter and fueling high levels of switching in car and in home’ said the company.
Growth in travel (excluding insurance) was also impressive at 33%, but the base level is much lower and the firm saw a clear slowdown in the final quarter of last year due to increased competition among holiday firms.
The money division, which helps customers get higher rates on their savings and lower rates on loans, saw a small dip in revenue despite a fourth-quarter rebound in borrowing, while home services also experienced a slight drop in revenue due to ‘continued broadband softness in a competitive market’.
Altogether the firm helped customers save a record £2.7 billion last year, according to chief executive Peter Duffy, even without a material contribution from energy switching, which Duffy expects to remain the case this year.
The firm said 2024 had got off to a good start, but it expected the comparisons in insurance to become harder moving into the second half of the year which accounted for the soft share price.
It also said it would expand its membership-based customer offering to drive customer loyalty and build on its ‘retain and grow’ strategy through SuperSaveClub, the MoneySavingExpert app – which already has over 1.1 million downloads – and cash-back service Quidco.
EXPERT VIEW
Roddy Davidson at Shore Capital described today’s update as ‘a pleasing performance’ with the full-year results above expectations and ‘an impressive £2.7 billion of estimated savings delivered to customers’.
The better-than-expected turnout and solid outlook ‘add to our confidence that the company is well-placed to leverage a range of positive factors to deliver strong earnings-per-share growth (31% FY23F-FY25F based on our current estimates), a useful dividend progression and very strong cash generation (conversion consistently >100%)’ added Davidson.
