Park Group is a specialised financial services business and is the UK’s leading provider of multi-retailer redemption products. Consumers can access products directly through its market-leading Christmas Savings offering while corporate customers use these products to supply a range of incentive and reward products.
FY19 results confirmed the underlying progress reported in the end-April trading update. Billings increased 3.4% to £426.9m, driven by the Corporate business and more profitable own-branded product, and despite £6.2m of discontinued low margin sales. Profit before tax and the £1.2m non-cash exceptional impairment of the group’s historical head-office site was little changed at £12.5m (FY18: £12.6m). This was despite an additional £0.9m deferral of revenues and profits under the new IFRS15 accounting standard, £0.5m is strategic development costs, and a one-off pension charge of £0.3m. Cash balances remained strong, and including cash held in trust reached a record £133.8m during the year, and the full year DPS increased by 5% to 3.2p. Management expects similar positive trends in the current year but for the c £2.0m net implementation costs for the strategic plan to dampen profits. From FY21 onwards it targets p&l benefits of £2–5m pa.
The market is estimated at c £6bn by the UK Gift Card & Voucher Association, and is fragmented, providing significant opportunities for growth.