What Personal Group does

Personal Group Holdings PLC (LON:PGH) specialises in the provision of employee services, including engagement programmes provided to corporate clients for their employees use and insurance products sold directly to client employees.

Insurance products include hospital cash plans, convalescence plans and death benefit, while employee engagement services focus more on salary sacrifice schemes, retail and leisure discounts and rewards, as well as other services like electronic payslips and app push notifications to help communicate with employees.

Personal Group’s business is currently divided into four main segments:

• An insurance business, which provides most of the group’s profits

• Let’s Connect – a service that allows employees to buy home technology through payroll deduction and salary sacrifice

• Software-as-a-service (SaaS) business – which includes Hapi, a benefits platform and app, enabling client employees to access their benefits

• Innecto – a pay and reward consultancy that provides support to employers setting up pay and reward schemes for their staff.


How is it doing

The group traded in line with expectations in 2019, making good progress on delivering the strategy implemented since the appointment of Deborah Frost as chief executive when the company acquired Innecto last March.

She said the Insurance division remained strongly profitable in 2019 despite a slowdown in the number of new client business wins; the company is now seeing signs that its marketing and sales investment is addressing this trend.

Let’s Connect improved its year-on-year performance and this growth is expected to continue following a positive reaction to the new proposition created for the National Health Service.

The SaaS business saw a strong year-on-year increase in revenue, helped by the fact that the provision of products such as reloadable cards, e-vouchers and cinema tickets are now serviced largely in-house.

An increase in paid-for Hapi subscriptions and the addition of consultancy income following the acquisition of Innecto have also helped to drive revenue growth, Personal Group said.

The relationship with accountancy software titan Sage continues to progress following the launch of Sage Employee Benefits on 2 September 2019 and a new extensive marketing campaign is planned by Sage for the first quarter of this year.


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Blue Sky

Frost’s first move as CEO was to launch a strategic review, the results of which are an aspiration to double underlying profits (EBITDA) by 2025 and to attract one million users on the Hapi platform.

“We intend to grow the insurance business by widening our accessible market to include the ‘gig’ economy for current and new clients, improving the attractiveness of our offer to employers and policyholders and retaining more policyholders for longer.

“This is expected to be delivered by disrupting core markets and driving profitable growth by growing the lower cost of acquisition segments with new products and cross-selling across the group.

“We intend to increase client/customer penetration and retention across all markets.”

Frost said the aim is to build a more balanced, broader portfolio that focusses on long-term profit and dividend growth, with less reliance on existing core markets.

In the January 2020 update, she said Personal Group was “starting to see the benefits of the investment that the company has made in sales and marketing and developing our strategy”.