Last checked at 3 Feb 2022 07:00
3 February 2022
JTC PLC
(the "Company" and together with its subsidiaries "JTC" or the "Group")
Pre-close Full Year Trading Update
Continued strong new business growth and trading in line with expectations
JTC, the global professional services business, today issues the following trading update in advance of its full year results for the year ended 31 December 2021.
2021 was a successful year for the Company which included our largest ever new client win, the first 'Shared Ownership' (Employee Incentive Plan) distribution since IPO, seven completed acquisitions, two oversubscribed fund raises and a refinancing of our debt facilities. The Board expects that the full year results will be in line with market expectations.
Despite the continuing effects of Covid, new business performance in the year was strong, with the annualised value of new business won increasing c.16% on a YoY basis to £20.9m (2020: £17.9m). These wins included the largest single new business mandate ever secured by JTC, a significant outsourcing mandate from a blue-chip global bank, which will be delivered by the Private Client Services Division. The contract was secured in Q2 2021 and following an extensive on-boarding process revenues will be recognised from H2 2022 onwards.
The Group is pleased with the acquisitions made during the year and progress with integration. Both INDOS and RBC cees have been fully integrated onto the JTC platform, with the RBC cees business rebranded to JTC Employer Solutions and now running at typical JTC profitability margins. The focus for 2022 and beyond is the growth of these propositions, including the Irish fund solutions business and development of JTC's Institutional Client Services (ICS) brand.
The acquisitions of SALI Fund Services, Segue Partners and EFS in the second half of 2021 significantly enhanced JTC's ICS business in the US. While the completion of the SALI transaction came approximately one month later in Q4 than expected due to change of control consents, we have been pleased with the performance of the business since acquisition. Additionally, a plan is being developed to maximise the opportunity to internalise the fund accounting work currently outsourced by SALI. Greater detail on this project will be provided when the full year results are presented in April.
The Group underlying EBITDA margin was consistent with management guidance relating to the short-term impact of bringing acquisitions onto the JTC platform and continues to trend towards medium term guidance levels of 33% - 38%.
The Company maintains its medium-term guidance metrics of 8%-10% net organic revenue growth; underlying EBITDA margin of 33%-38%; net debt of 1.5x to 2.0x underlying EBITDA and cash conversion in the range 85%-90%.
Nigel Le Quesne, CEO of JTC PLC, said:
"2021 was the first year of our latest multi-year business plan, the Galaxy Era, in which we are aiming to double the size of the Group relative to where we ended FY20. We have made an excellent start with strong new business wins, good organic growth and a highly engaged and motivated global workforce that is bound together by our culture of shared ownership. Our inorganic growth ambitions have been particularly successful with a record seven acquisitions completed in the year, three of which were in the high growth US institutional services market.
"2022 will see us build upon the progress made in 2021, while continuing to focus on delivering client service excellence, maintaining strong organic growth within the core business and capturing high quality opportunities in a consolidating market."
The Company will announce its full year results for the year ended 31 December 2021 on Tuesday 19 April 2022. An analyst briefing will be given by Nigel Le Quesne, Chief Executive Officer, and Martin Fotheringham, Chief Financial Officer, at 09:30 BST via audio conference.
Enquiries:
JTC PLC +44 (0) 1534 700 000
Nigel Le Quesne, Chief Executive Officer
Martin Fotheringham, Chief Financial Officer
David Vieira, Chief Communications Officer
Camarco +44 (0) 20 3757 4985
Geoffrey Pelham-Lane
Monique Perks
Emily Shea-Simonds
About JTC
JTC is a publicly listed, global professional services business with deep expertise in fund, corporate and private client services. Every JTC person is an owner of the business and this fundamental part of our culture aligns us with the best interests of all of our stakeholders. Our purpose is to maximise potential and our success is built on service excellence, long-term relationships and technology capabilities that drive efficiency and add value.
www.jtcgroup.com