Our belief is that technology can be a powerful enabler, but it is our people that translate that into meaningful experiences for our customers. That’s why we have invested heavily in our people and improved everything from the recruitment and induction process, to the ongoing development of individuals and teams, to taking a long-term view of the skills and capabilities our business will need most.
Dear Shareholders,
In our second full year as a listed company we became a multi-brand, multi-office Group with enhanced technical and operational capabilities that place us in a strong position to help people everywhere save time and money.
Throughout 2018 we demonstrated our ability to work and adapt quickly to a dynamic environment without losing sight of the day-to-day requirements of our businesses. We firmly believe that choosing to grow quality earnings in a challenging economic cycle remains a good business and financial decision, allowing us to allocate capital to ideas that will transform the customer experience – and the company – over the medium to long term. Our fast integration of two acquisitions enabled us to leverage the companies’ assets to the benefit of the Group, launching a brand-new automated switching proposition in the form of weflip, and achieving 13.6% operating profit and 22.2% adjusted operating profit growth.
Just a month after acquiring Energylinx, we made use of their industry-leading, Ofgem-regulated comparison and switching service to launch a new customer journey through GoCompare, and in October we launched weflip having built the service using Energylinx and our Newport-based engineering and data teams. Energylinx was also an excellent acquisition in its own right with strong underlying financial performance since acquisition. With MyVoucherCodes, we quickly replatformed the business and used our strengths in technology and partner relationships to secure exclusive deals with News UK and Reach plc to power the discount voucher services for The Sun and Express websites.
The achievements delivered by the team at the GoCompare Group give me a real sense of pride. We’ve been consistent in believing that we can stand out in extremely competitive environments by having an entrepreneurial mindset and a culture that supports experimentation and demands action. With our consistent focus on profitable, disciplined delivery, strong cash generation allows us to make a more strategic use of capital be that through marketing, acquisitions or investments.
Our belief is that technology can be a powerful enabler, but it is our people that translate that into meaningful experiences for our customers. That’s why we have invested heavily in our people and improved everything from the recruitment and induction process, to the ongoing development of individuals and teams, to taking a long-term view of the skills and capabilities our business will need most.
We focused on several key areas that span diversity and inclusion and introduced a number of initiatives designed to help the Group become a home for the most talented people based solely on merit. We rolled out company-wide unconscious bias training, implemented blind CVs in the recruitment process and introduced monitoring software to ensure job descriptions and job adverts aren’t inadvertently off-putting.
Importantly, we launched our GoFurther Academy through which all our training, mentoring and development activity is channelled. Through GoFurther, we picked five talented, local to Newport school-leavers who are interested in careers in technology based companies, and they have started a sponsored degree apprenticeship programme with Aston University. We are committed to our ambition of being the technology employer of choice, particularly in the South Wales and South West England region, and take a role in developing the local talent pool very seriously.
Outside of doing the right thing, our ongoing investment in people is the right business decision. By building a workforce of people who have great skills and attitude, and by creating a culture that they want to be part of, we are able to recruit and retain star performers who are impatient to build and evolve products, services and even whole new brands (see weflip) that result in better customer experiences. Capable and motivated people can change the world. We welcomed Zoe Harris to the Group’s leadership team in October, taking up the role of Chief Marketing Officer, having previously been Group Marketing Director and Head of Innovation at Reach plc. Her impact has already been felt, with an immediate focus on speed of change, marketing efficiency and using our strengths to innovate in brand and digital channels. Zoe has also led the appointment of a new media planning and buying agency for the Group to ensure that our significant advertising spend generates maximum awareness and customer action.
When we listed in November 2016, we committed to highlight the need for ‘botheration’ in order to tackle people’s inability or unwillingness to shop around and switch to better deals. Through developing products and services that take away the burden of keeping on top of household outgoings, and through targeted and compelling marketing communications, we aim to save as many people as possible as much time and money as we can – year after year.
Despite the price comparison sector having been established over 15 years ago, millions of people still struggle to effectively manage the burden of their personal and household bills, and overpay for products and services as a result. We believe that we can address this gap through weflip, which aims to remove the ongoing burden through a strong, compelling, more automated proposition. A one-time sign up allows people to delegate the management of the tedious chore of energy switching to weflip, forever. Indeed it is so tedious, in fact, that 54% of British households have never or only once switched (according to Ofgem). It uses all our strengths in data, engineering and product development to create seamless experiences across browsers and devices.
We continue to transform the Group so that we continue to disrupt the market as we did when GoCompare launched over 12 years ago, when we were instrumental in changing the way people find, evaluate and buy insurance forever.
The Board expects another year of disciplined performance on the core business with modest revenue growth and stable marketing margin, with performance to be skewed towards H2, reflecting our business initiatives and the market backdrop.
We are investing in weflip in 2019 to unlock the potential for exceptional growth in the medium term, with a spend in the region of £10m in marketing funded by operational cash flow from the core business.
Our ambitions are to scale weflip to transform the Group into a higher EBITDA margin business. weflip will benefit from higher customer retention, recurring revenue and multi-year customer lifetime value.
We remain proud of our focus on constant capability improvements that enable us to meet and even re-set consumers’ evolving expectations, alongside the generation of strong, quality earnings driven by operational control and efficiency, and a constant search for innovation.
Whether someone is looking for a good deal on more non-discretionary products and services (GoCompare, Energylinx, weflip), or for things they really want and enjoy (MyVoucherCodes), GoCompare Group has a free service that can make things as easy as possible for them, while allowing people to maintain the level of control they need. For example, for those people who know what they want and how to do it – we refer to them as ‘savvy switchers’ – GoCompare gives an established, transparent and industry-leading comparison and switching service. For those who need more help and who’d rather delegate bill management, weflip is at the fore of the new and growing range of more automated services.
While change and evolution is inevitable in 2019, and with broader political and economic unease a certainty, we will continue to provide services that work for consumers, appeal to our partners, motivate our employees, and build long-term value for our shareholders. We are and will remain in the service of saving.
