Appreciate announces £3.45m acquisition

Profits exceed expectations at Liverpool savings and corporate rewards business Appreciate Group as it announces a £3.45m acquisition. Tony McDonough reports

Ian O'Doherty
Ian O’Doherty, chief executive of Appreciate Group

 

Pre-tax profits at Liverpool savings, vouchers and corporate rewards business Appreciate Group have hit £8.4m – ahead of market expectations.

In an end-of-year trading update in April, Appreciate said it expected profits for the 12 months to March 31 to hit £7.5m. Revenues for the year came in at £123.3m – up 15.4%. This is a clear sign of recovery after the company took a hit during COVID-19.

Previously known as Park Group, the business closed its traditional Christmas hampers operation in 2020. It is now focused on Christmas savings and providing vouchers and pre-paid cards for retailers and corporate rewards. The firm employs around 250 people in Liverpool city centre.

One of its best-known products is the Love2shop gift card. This can be redeemed with around 200 household brands including Argos, Boots, Iceland, M&S, Matalan, River Island and Schuh. It was boosted further in March when Appreciate agreed a deal with Primark. This will see the fashion retailer accept the cards in its store network.

On Tuesday, Appreciate announced the acquisition of MBL Holdco from Redu Group. MBL is a North East-based gift card technology provider to UK businesses and consumers. It specialises in offerings which are complementary to Appreciate’s corporate business, including:

  • An end-to-end gift card processing and management service for retailers.
  • A digital gift card mall enabling B2C and B2B customers to purchase gift cards directly from a catalogue of more than 160 high-street retailers.
  • A SaaS offering, which is a fully white-labelled eCommerce platform, enabling businesses to launch their own fully functional gift card websites.

The acquisition was completed on June 24 for an initial cash consideration of £1.65m. A further £1.8m is deferred for 12 months dependent on certain criteria being met. The initial cash consideration is being met from Appreciate’s existing financial resources. 

 

Love2Shop
Appreciate Group offers the Love2shop multi-retailer voucher

 

Ian O’Doherty, chief executive of Appreciate, said: “The acquisition of MBL rapidly accelerates the group’s technology plans. It immediately enhances our capabilities, particularly in our corporate business.

“The MBL platform will help us improve the competitiveness of our offerings and bring forward opportunities that can deliver higher levels of growth.”

In its annual results Appreciate also saw a rise in billings. These represent the value of goods and services shipped and invoiced to customers, net of VAT, rebates and discounts.

Excluding Christmas Savings, billings are £222m, up 5.5%. This follows three consecutive quarters of double-digit growth from Q2 onwards. Digital billings are up 20.5% to £54.8m (FY21: £45.5m)

Total Group billings are down to £385.8m (FY21: £406.5m). This follows a reduction in billings from Christmas Savings which were impacted by lockdown measures, restricting agent collections.

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