Insurance outsourcer boosts EBITDA margin target to 30% after strong year
Insurance outsourcer Quindell made a 2013 profit before tax of £107m, up 202% on the £35.4m it made in 2012.
Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 164% to £137.7m (2012: £52.2m).
Adjusted EBITDA margin based on revenue rose four percentage points to 36% (2012: 32%). The company has now boosted its longer-term EBITDA margin target to 30% from 25%.
The jump in profitability was driven by a 133% increase in revenue to £380.1m (2012: £163m).
Although Quindell has been acquisitive, most of the revenue growth was organic. The company said that the bulk of its purchases were completed in 2012 and acquisitions only contributed 11% to 2013 revenues.
Year of proof
Quindell founder and executive chairman Rob Terry said: “Our strategy, set at the time of our listing on AIM in May 2011, needed to be proven to the market, to our industry and to all other stakeholders during 2013.
“By doing so, Quindell has the potential to be rewarded with a market rating that is more appropriate for the growth and high quality revenue visibility that it provides for any investor. So in summary, 2013 was a year to provide “proof”. We delivered on our goal of significantly exceeding market expectations with 168% growth in technology solutions revenue, our highest margin and most cash generative segment.”
He added: “Trading in 2014 has also been ahead of plan for all key performance indicators, being profitability, cash generation and EBITDA margin.
“We are determined to ensure we achieve the optimum valuation for the company’s shareholders, the best and most innovative services and technology for our clients, and be a great place to work for our staff. All of this gives me and our team, immense confidence in our ability to grow from this platform and continue the success in 2014 and beyond exceeding current market expectations.”
Full listing progress
Quindell is seeking to convert its current listing on the Alternative Investment market (AIM) into a full listing on the London Stock Exchange.
It plans to submits its prospectus to the UK Listing Authority by mid-April, and is targeting a full listing for early June.
The company is expecting to be part of either the FTSE 250 or the FTSE 100 indices, which contain the largest companies on the London Stock Exchange. It is also considering a listing in North America.