This announcement contains inside information which is disclosed in accordance with the Market Abuse Regulations
Trustpilot Group PLC
11 January 2024
Trading update for the year ended 31 December 2023
FY23 ARR +c.18% YoY at constant currency, Adj. EBITDA above the top end of market expectations
Trustpilot Group PLC ("Trustpilot"), a leading global review platform, provides an update on trading for the financial year ended 31 December 2023 ("FY23").
FY23 highlights
● Revenue +c.17% bookings +c. 16% and ARR +c.18% YoY at constant currency
● Reported Adjusted EBITDA1 ahead of the top end of the range of market expectations2
● Net dollar retention rate resilient YoY at 99% (FY22: 100%)
● Our balance sheet remains strong, with our net cash balance increasing to $91m, reflecting strong cash generation in the period
● Separately announced share buy-back program of up to £20m (c.$25m)
| USD
| FY23 expected | FY22 actual | (+/-) % actual | (+/-) % constant currency |
| Total revenue | $176m | $149m | +c.18% | +c.17% |
| ARR3 | $197m | $162m | +c.22% | +c.18% |
| Total bookings4 | $195m | $165m | +c.18% | +c.16% |
For FY23, Trustpilot expects to report Group revenue of $176m, +c.17% at constant currency. We expect to report FY23 annual recurring revenue (ARR) of $197m, compared to $162m in the prior year, representing c.18% constant currency growth year-on-year. Total bookings increased to $195m, up c+.16% year-on-year at constant currency, and the LTM net dollar retention rate was 99% (FY22: 100%).
We continued to manage our business to deliver additional operating leverage in H2, further supported by solid top-line growth. Hence, we expect to report Adjusted EBITDA above the top end of the range of market expectations. In addition, we continue to deliver strong cash generation, and we closed the year with $91m of cash and no debt (30 June 2023: $83m).
Share buyback programme
Separately, Trustpilot announced today a c.£20m share buyback (which would amount to a buyback of up to approximately $25 million at prevailing exchange rates). This reflects our disciplined capital allocation strategy to deliver profitable growth and cash flow generation. Please see the separate RNS announcement for further details.
Adrian Blair, CEO, commented:
"Building on a solid performance in the first half of the year, we achieved further growth and margin improvement in the second half, with profitability and positive free cash flow ahead of expectations for the year. In addition to our focus on delivering sustainable operating leverage, we achieved robust growth in new business and a resilient retention rate across all regions. Following our commitment to return excess capital to shareholders, we announced today a share buyback programme of up to £20m.
The strong performance in FY23 shows the strength of the Group. We remain confident in our ability to sustain growth and improve margins over the long term as we deepen the network effects in our model to capitalise on large and growing market opportunities."
Notice of results
Trustpilot will report results for the financial year ended 31 December 2023 on Tuesday, 19 March 2024. On that day, an in-person analyst and investor briefing will take place in London at 09:00, which will also be accessible via webcast and conference call. For registration, please visit https://investors.trustpilot.com.
1 Adjusted EBITDA excludes share-based compensation, associated cash-settled social security costs, and non-recurring transaction costs such as restructuring costs. In addition, as previously announced, from FY23 onwards, Adjusted EBITDA also excludes capitalised sales commissions under IFRS 15 - this benefited FY23 Adjusted EBITDA by c.$4m and should be expected to contribute a c.$3m benefit in FY24.
2 On 31 December 2023, the company-compiled analyst consensus stood at mean constant currency revenue and bookings growth of 15% and 14%, respectively, and a mean Adj. EBITDA forecast of $12.4m, with the range of $11.1m - $14.1m.
3 Annual Recurring Revenue = Monthly Recurring Revenue * 12 translated at period closing spot rate.
4 The annual contract value of contracts signed in a given period translated at monthly average rates.
Enquiries
Trustpilot
Derek Brown, Head of Investor Relations
Adrian Blair, CEO
Hanno Damm, CFO
investor.relations@trustpilot.com
https://investors.trustpilot.com
Financial PR
Headland Consultancy
Stephen Malthouse
Charlie Pepper
+44 (0)73 1136 9861
About Trustpilot
Trustpilot was founded in 2007 with a vision to create an independent currency of trust. A digital platform that brings businesses and consumers together to foster trust and inspire collaboration. We are free to use, open to everybody and built on transparency.
Trustpilot hosts reviews to help consumers shop with confidence and deliver rich insights to help businesses improve the experience they offer. The more consumers use our platform and share their opinions, the richer the insights we offer businesses, and the more opportunities they have to earn consumers' trust worldwide.
Trustpilot has around 900 employees and is headquartered in Copenhagen, with operations in London,
Edinburgh, New York, Denver, Melbourne, Amsterdam, and Milan.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
