Mind Gym PLC – Full year results

Mind Gym PLC – Full year results

Mind Gym (AIM:MIND), the global provider of human capital and business improvement solutions, is pleased to announce its audited full year results for the year ended 31 March 2019.

Financial highlights

12 months to 31 Mar 2019 (FY19)

12 months 31 Mar 2018 (FY18)

Change

Revenue

£42.1m

£37.0m

+14%

Gross profit margin

80.6%

79.3%

+1.3pps

Adjusted EBITDA*

£8.7m

£7.9m

+11%

Adjusted EBITDA* margin

20.7%

21.3%

-0.6pps

Adjusted EBIT/PBT*

£8.5m

£7.7m

+12%

Adjusted EBIT* margin

20.3%

20.7%

-0.4pps

Statutory PBT

£5.1m

£6.2m

       -17%

Basic EPS

4.08p

4.94p

-17%

Adjusted Diluted* EPS

6.85p

5.77p

+19%

Total Dividend per share **

2.4p

n/a

Net Cash

£8.3m

£5.5m

+50%

Adjusted* EBITDA cash conversion***

113%

79%

+34pps

EBITDA cash conversion***

142%

77%

+65pps

 *Adjustments include foreign exchange gains/losses (prior year only), IPO transaction costs and aborted transaction advisory fees, employee share option surrender bonuses and share-based payment charges. A  reconciliation of these adjustments is shown in Note 6.
** Post-IPO dividends only shown. Note 11 sets out details of pre-IPO dividends.
***EBITDA cash conversion defined as cash generated from operations/EBITDA

  • Revenues up 14% to £42.1 million (FY18: £37.0 million). On a constant currency basis revenues grew 13%
  • Gross profit margin up to 80.6% (FY18: 79.3%), driven by improved sales mix towards higher margin services
  • Adjusted* EBIT margin slightly decreased to 20.3% (FY18: 20.7%), principally the result of investment in people
  • Adjusted* diluted EPS increased by 19% to 6.85p (FY18: 5.77p)
  • Cash balance of £8.3 million despite £2.3m IPO related cash costs and £3.2 million pre-IPO dividend
  • Final dividend of 1.6p per share will be paid in August 2019, bringing the total dividend for the year to 2.4p

Operating highlights

  • Revenue growth fuelled by both new client acquisition and demand from existing clients, with 84% of revenues coming from clients who have engaged with Mind Gym in one or more of the past three years
  • Digital revenues grew by 72% to £3.6 million, representing 9% of total revenues (FY18: 6%), supported by 13 new e-workouts and contributing to gross profit margin improvement
  • Average number of employees during the year increased by 13%, ensuring Mind Gym can meet the rapidly growing demand for its services globally
  • Product innovation highlights:
    –  Development soft launch of a new diagnostics tool in Q4 to support digital growth;
    –  Roll out of 13 more digital workouts;
    –  Successful launch of a suite of new instructor-led and digital products to help clients prevent and address bullying and harassment at work; and
    –  Development of a customer service ‘Point of View’, launching in FY20, which will create new revenue opportunities.
  • Investment in operations to support future growth including a number of new hires, most notably a Chief Operating Officer to drive data and efficiencies.
  • The percentage of participants rating their Mind Gym experience as ‘Excellent’ (5/5) rose from 50.4% to 53.3%% in 2019, and those rating it as either “Very Good” (4/5) or “Excellent” (5 /5) from 87.7% to 88.5%

Octavius Black, Chief Executive Officer of Mind Gym, said:

“We are pleased with the Group’s performance in our first financial year as a listed business.

With people and talent issues high on corporate leaders’ agenda, this is an exciting time for a disruptive, behavioural change company with a track record of delivering lasting impact in many of the world’s largest businesses. The opportunity in a growing learning market is substantial and Mind Gym is well positioned with a clear growth strategy to help meet the worldwide demand for behavioural science-based solutions.

The global market for Learning and Development is over $240bn – half of this in behavioural areas that we believe can be directly addressed by Mind Gym – and with growth of 9% in the last year, the market shows no sign of slowing. 

We feel confident about the Group’s future and further progress following a strong start to FY2020.”

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