- Three-month revenue up 14%
- Insurance income jumps 38%
- Shares gain 7.5% on update
Shares in Moneysupermarket (MONY) climbed 7.5% to 263p after the FTSE 250 price comparison website said increased customer switching in car and home insurance products gave its third-quarter revenue a major boost.
The company reported ‘strong growth in all core insurance channels’ including insurance and travel with revenue for the three months to 30 September up 14% to £115.6 million.
INSURANCE SWITCHING ROCKETS
Revenue from insurance products, including car, home and travel, surged 38% as customers flocked to the site to look for cheaper deals due to rampant price-hiking by the big insurance companies, while travel revenue soared 31% as people sought out the best offers on package holidays.
Home services revenue dipped 1% due to continued softness in broadband switching, partially but not fully offset by strong growth in mobile switching.
As yet the firm hasn't seen any switching activity in energy, as suppliers are tending to keep prices high, but at some point this is expected to return providing another major source of income.
Chief executive Peter Duffy said the group was confident in delivering full year expectations. ‘We help millions of people save money on their bills. While headwinds in some of our markets persist, we are making progress on our strategy - expanding our offering while attracting and retaining customers more efficiently.
‘We're particularly excited to have launched a rewards and loyalty programme under the Moneysupermarket brand, the SuperSaveClub. It is very simple - if we help customers save more, we will drive profitable growth for the group.’
The only damp squib was the money division which reported revenue of £25.2 million, down 10% year-on-year and 5% over the nine-month period, due to lapping a very strong prior-year period and the high interest rate environment which ‘continues to impact conversion for borrowing products.’
ANALYST APPLAUDS CONTINUED MOMENTUM
Roddy Davidson, analyst at Shore Capital, remains upbeat about Moneysupermarket’s ‘resilient business model’ and ‘on-going strategic progress.’
Davidson said: ‘We are pleased to note the positive headline trading momentum. The balance provided by Moneysupermarket’s broad portfolio of money saving services and adds confidence to our full year 2023 estimates and expectation of strong medium term earning per share growth (three-year aggregate +41%), robust cash generation (average three-year conversion 105%) and a growing dividend.’
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