Results from moneysupermarket.com for the first half of 2009 show that difficult trading conditions continue in the price comparison sector.
Revenues were down by 31% to £68.5m at the UK’s leading price comparison website, and operating profits fell by 89% from £12.7m to £1.4m. However, the business is still highly cash generative and remains debt free with cash balances of £75.6m at the end of June 2009.
Closer examination of the results highlights the pressures that the company has come under in the credit crunch. Revenues in the insurance sector remained fairly strong at the start of 2009 as moneysupermarket.com strengthened a core part of its business.
The money part of the organisation – which covers searches on mortgages, credit cards, current accounts, loans and savings – suffered as the credit markets worsened over the course of 2008 and the early part of 2009. A reduction in the supply of credit and a tightening of underwriting criteria meant that ‘money’ revenues declined from £40.3m to £18.6m. First Plus, which closed to new business in August 2008, alone contributed nearly £10m towards revenues in the first half of 2008.
CEO remains confident
Peter Plumb, chief Executive of moneysupermarket.com, remains optimistic about the prospects for the comparison website sector and his company in particular: ‘Moneysupermarket.com has made a solid start to the year. Trading levels have stabilised over the past six months and we remain a profitable and highly cash-generative business.
‘The moneysupermarket.com brand remains strong. As the leading price comparison website our broad product offer is clearly as relevant as ever to our customers. We are confident that the work we are doing across the business will ensure that moneysupermarket.com is well positioned to capitalise on its strengths when growth returns to our markets.’
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