PensionBee Group plc

Good afternoon, ladies and gentlemen. Welcome to the PensionBee Group PLC Q4 results investor update. Questions are encouraged. They can be submitted at any time using the Q&A tab situated on the right hand corner of your screen. Please simply type in your question at any time and press send. Alternatively, you can ask your questions verbally by simply placing a question mark along with the firm that you represent in the Q&A panel. We'll then unmute your microphones and then invite you to ask your question to the presenting team. Before we begin, we'd like to submit the following poll. And I'd now like to hand over to CEO Rami Slavova. Good afternoon.

Good afternoon and welcome to PensionBee's Q4 2024 results announcement covering trading for the period ending 31 December 2024. I'm Romy Savova, the CEO of PensionBee Group. For those of you who are new to the PensionBee story, we are creating a global leader in the consumer retirement market. We exist to help our customers prepare for and enjoy a happy retirement. We enable our customers to combine their old retirement accounts into a new online plan. We enable them to make contributions, to invest in line with their objectives, with money managed by the world's largest asset managers, and ultimately to withdraw and spend their retirement savings. Our aspiration is to build a lifetime relationship with our customers, generating predictable and scalable revenue for our company and for our investors. Over the fourth quarter of 2024, we continued to record strong growth in assets under administration, revenue, and invested customers. As a result of our revenue growth, effective cost control, and increasing productivity, we achieved positive adjusted EBITDA for PensionBee Group in Q4 2024 and for the year overall. In the United Kingdom, we were pleased to deliver significant growth with assets under administration of £5.8 billion, representing 34% year-on-year growth, annual run rate revenue of £38 million, representing 36% year-on-year growth, and 265,000 invested customers, representing 16% year-on-year growth. To continue capturing the market opportunity, we believe it is important to own our customer relationships so that we can fully understand the evolving needs of the consumer base and ultimately serve them more effectively. To that end, in the UK, we have invested £64 million in the PensionBee brand cumulatively, and our prompted brand awareness now stands at 57% whilst unprompted brand awareness, reported now for the first time, was 15%. Our data-led advertising approach, combined with our household brand name, has continued to deliver marketing efficiency. Each pound of marketing expenditure generated 96 pounds of net flows over the full year of 2024, an increase of 10% year on year. At the same time, we continued to maintain a stable cost per invested customer of £242. In 2024, PensionBee entered the US, the world's largest defined contribution pension market, with $24 trillion in assets in partnership with State Street Global Advisors, our longstanding asset management partner. Since our SEC registration in July 2024, PensionBUS has been advancing at a rapid pace, leveraging our scalable technology platform. Our robust technology foundation has enabled PensionBUS to hit key milestones and progress at a faster rate than initially achieved in the UK, generating revenue by December 2024. Over Q4, we continued to build the foundations of our US business. We rolled out further components of our multi-channel diversified marketing strategy and onboarded our first customers through early testing. The year concluded with the launch of the native mobile app on both the Google Play and Apple App Stores in December. Over the coming weeks and months, PensionBee intends to launch its Roth IRA and to continue building custom rollover journeys for the largest US providers. PensionBee will also continue to build out its Safe Harbor IRA proposition, working with its partners at State Street, relevant third parties, and potential clients. I would now like to hand over to Christoph Martin, PensionBee Group's Chief Financial Officer, who will cover the financial update. Over to you.

Thank you very much, Romy. A very warm welcome to everyone. I'm pleased to cover the financial section of the quarterly trading update. In the fourth quarter of 2024, PensionBee achieved another key milestone. At the time of our IPO, we gave a profitability guidance to achieve full year profitability in the UK by 2024. And today we can confirm that we have achieved our UK profitability milestone in line with our IPO guidance. Moreover, we also achieved our group breakeven, which is again consistent with our new guidance framework introduced on the 1st of October last year during our Capital Markets Day. Those consistent achievements are further testament of our consistent and reliable execution against our public market guidance and is ultimately derived from the business core value drivers, which are first, predictable and recurring revenue, and second, business scalability. The first value driver is PensionBee's predictable and recurring revenue, which is generated from a durable base of assets and administration and is derived from the assets of existing and new customers. In the fourth quarter, we have seen a 34% year-on-year EOE growth to 5.8 billion pounds. The vast majority of our AOA base is derived from existing customers. Customers who remain with PensionBee for a long period of time and continue to build up their pension savings with us, resulting in value generation for decades to come. This is because our average customer is around 40 and they build up the pension savings with PensionBee, which means that cohorts on an underlying value basis are growing over time. Next, AOA is also derived from new customer acquired through our proven approach to cost-disciplined new customer acquisition. As a result, the compounding AOA base is subsequently converted in our revenue base owing to our resilient revenue margin. In Q4 2024, we have seen a revenue margin of 64 basis points, which enabled us to convert the 34% of year-on-year EOA growth into annual run rate revenue growth of 36% and full year 2024 revenue growth of 39%. In conclusion, owing to our compounding EOA-based and resilient revenue margin, we are driving highly predictable and recurring revenue. The second value driver is pension-based business scalability, owing to the controllability of our cost base, which is thereby declining as a proportion of revenue. The cost base for 2024 for the group amounted to circa 33 million pounds, an increase of only 2% year on year compared to revenue growth of 39% year on year. Those scalability dynamics of predictable and recurring top line growth coupled with cost discipline led to an improvement in adjusted EBITDA margin. With respect to our 2025 guidance framework for PensionBee as a group, outlying our short, medium and long-term targets, In the short term, in 2024, we expected the group to generate revenue of circa 30 million pounds and we further targeted a break-even profitability point. We delivered on this guidance, achieving group revenue of 33 million pounds and group adjusted EBITDA break-even of 0.4 million pounds of profit as measured on adjusted EBITDA. Short to medium term. In the short to medium term, spanning around three to five years, we target the group to generate revenue of above £100 million and group adjusted EBITDA margin of circa 20% by year five, whereby the UK is considerably contributing to group profitability. In the long term, spanning 5 to 10 years, we expect the group to generate above a quarter of a billion pounds of revenue and target a group adjusted EBITDA margin of circa 50%. The cash balance is strong with circa 35 million pounds or circa 43 million dollars, putting PensionBee in a strong position to further scale their UK business as well as invest in the tremendous US market opportunity to continue execution against our public market guidance. I would now like to hand back to Romy for concluding remarks.