Last checked at 19 Mar 2020 12:00
19 March 2020
The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
THE PEBBLE GROUP PLC
("The Pebble Group", the "Company" or the "Group")
Trading Update and COVID-19
The Pebble Group, a leading provider of products, services and technology to the global promotional products industry, issues the following trading update for the year ending 31 December 2020 ("FY20"), which includes initial details of the impact of the COVID-19 pandemic.
Whilst it is impossible to estimate the full impact of the pandemic on the Group's performance at this stage, a COVID-19 mitigation strategy is being implemented and the Board's current view is that the Company is well placed to manage the disruption and is confident in the long term prospects for the business.
COVID-19 strategy
· Business operations are fully functioning, despite the disruption, and work patterns, which maintain the team dynamic and effectiveness whilst minimising risk, have been put in place;
· The Pebble Group has strong cash balances, no debt, a committed revolving credit facility of £10m and an efficient working capital model. New measures aimed specifically at managing cash during the outbreak are currently being implemented, including a hold on non-committed capital expenditure;
· Product supplies from China and elsewhere have been successfully maintained to date and this is expected to continue.
How COVID 19 is currently impacting the Group's trading
Revenue source | Contribution to Adjusted EBITDA in FY19 |
Status |
Facilisgroup |
34% |
Minor disruption |
Facilisgroup operates primarily on a SAAS recurring revenue model (c.68% of divisional revenue)
|
| Customer (Partner) numbers continue to grow in line with the management's expectations and, although the sales processed per Partner are expected to decline in the year as a result of the virus, the business remains on track for FY20.
|
Brand Addition
| 66% |
|
Consumer promotions (c.30% of divisional revenue)
|
| Minor disruption
|
Consumer promotions supports the sales of clients |
| Trading remains in line with management expectations.
Orders are placed early in the year for clients' H2 20 promotions. Order values amounting to c.70% of our full year expectations have already been received, which is slightly ahead of the prior year.
|
Corporate programmes (c.70% of divisional revenue) |
| Major disruption |
Corporate programmes supports clients' general marketing activities |
|
Substantial reduction in order intake experienced in the last two weeks, as clients take understandable measures to protect their people through home office working and the cancelation of travel, conferences and events.
We cannot predict the longevity of this situation but there will be a financial impact resulting from COVID-19 in FY20.
New business activity in Corporate programmes in the year to date has been strong. The Group currently expects to benefit from this new business in H2 20. |
In summary
The Group's balance sheet is strong and debt free and the Board is confident in the future prospects for the Group and its growth strategy. The strength and robustness of the Facilisgroup business model is being demonstrated in this uncertain trading environment and we remain confident about its prospects in 2020 and beyond. New business activity in Brand Addition in Q1 demonstrates the attractiveness of its offering and the constitution of its client base, together with its geographical and sector diversity, leave the business well-placed to manage in the short term and benefit as normal business activity resumes.
As previously announced, the Group intends to issue final results in line with expectations for the year ended 31 December 2019 on 2 April 2020 and will update the market further at this time.
Enquiries:
The Pebble Group plc Chris Lee, Chief Executive Officer Claire Thomson, Chief Financial Officer
| +44 (0) 161 786 0277 |
Grant Thornton UK LLP (Nominated Adviser) Samantha Harrison / Harrison Clarke / Niall McDonald
| +44 (0) 20 7383 5100 |
Berenberg (Corporate Broker) Chris Bowman / Marie Stolberg / Simon Cardron
| +44 (0) 20 3207 7800 |
Belvedere Communications (Financial PR) Cat Valentine Keeley Clarke Llew Angus | thepebblegrouppr@belvederepr.com +44 (0) 7715 769 078 +44 (0) 7967 816 525 +44 (0) 7407 023 147 |
About The Pebble Group plc - www.thepebblegroup.com
The Pebble Group is a provider of products, services and technology to the global promotional products industry, comprising two differentiated businesses, focused on specific areas of the promotional products market:
Brand Addition - www.brandaddition.com
The Group's promotional product merchandise business, Brand Addition, is a leading provider of promotional products to global brands. Brand Addition utilises its global network to source and deliver complex and creative promotional product solutions to support the marketing efforts of its multi-national clients, who operate in sectors which include health & beauty, fast moving consumer goods, transport, technology, banking & finance and charity. Brand Addition's clients primarily comprise major global brands.
Facilisgroup - www.facilisgroup.com
The Group's SaaS business, Facilisgroup, provides subscription-based services to SME promotional product distributors in the United States and Canada. Facilisgroup's suite of services includes business intelligence software, buying power and community events. Through its @ease proprietary software, Facilisgroup offers a SaaS technology platform that enables its network of Partners to improve order management, CRM and sales analysis and reporting. Facilisgroup also provides its Partners with access on favourable terms to a selected group of preferred suppliers, by consolidating the purchasing power of its Partners. This attracts rebates from suppliers, who in turn benefit from access to a network of selected distributors.