Revenues at Moneysupermarket soar by 19%
Revenues at online firm Moneysupermarket.com rose by 19% to £104.9m in the first quarter of the year.
The Chester based business issued a trading update this morning,
The company said motor insurance benefited from improved conversion, partially offset by subdued trading in life insurance as competitors spent more on their customer incentives.
The combination of attractive offers and the announcement of the price cap increase meant energy switching was exceptionally strong in the quarter
Mark Lewis, chief executive of Moneysupermarket.com Group, said: “The reinvent strategy continues with a strong first quarter of trading, notably helping a record number of customers beat the rising energy price cap.
“Moneysupermarket innovation continues, we have new branding and advertising to remind everyone how we can help them with their finances and ‘get money calm’ and new products like Credit Monitor are on the site.”
Performance of Home Services was exceptional in the first quarter and the firm expects this to moderate through the year.
The outlook for the year remains unchanged. The board remains confident of meeting current market expectations.
Following the announcement in February of a proposed £40m enhanced distribution and the related shareholder consultation, the board confirmed that this will be made by way of special dividend.
Russ Mould, investment director at Manchester investment firm AJ Bell, said: “Comparison site Moneysupermarket’s stellar first quarter numbers are all the more impressive when you consider demand for its services are often seen as being linked to the fortunes of the UK economy.
“But while the latter might be struggling, mired in political and economic uncertainty, Moneysupermarket is forging ahead investing in new technology and expanding into new areas.
“This involves investment and is perhaps why the company is not lifting full year guidance, despite performing significantly better than expected in the first three months of the year.
“This cautious approach also reflects the fact that it’s first quarter numbers were boosted by a particularly strong period for energy switching ahead of flagged price increases from the big suppliers, a trend which the company expects to moderate in the remainder of the year.”
He added: “A new strategy built around a tailored service which would push products to consumers based on their needs and profile is seen as a potential game-changer for the business.
“It could create more of a subscriber-based model, with a stronger connection with users which could help address the significant marketing costs and competition associated with the price comparison market.
“Today’s statement shows how competitive that market still is. This is principally reflected in the life insurance market where rivals have been allocating more to customer incentives.”