Formerly known as Park Group, Liverpool-based Appreciate has finally closed its decades-old Christmas hampers business to focus solely on financial services. Tony McDonough reports

Appreciate Group has finally closed its decades-old Christmas hampers operation as the Liverpool business completes its transformation into a financial services company.

Until last year Appreciate was known as Park Group and began life in the 1960s as a Christmas savings and hampers club. It grew out of the Birkenhead butchers shop owned by the family of the business founder, Peter Johnson.

Earlier this year, it announced the hampers businesses was to end. It has disposed of its headquarters and distribution depot in Birkenhead and moved its 270 staff into 20 Chapel Street in Liverpool city centre.

On Tuesday, AIM-listed Appreciate, which is now fully focused on Christmas savings, vouchers and pre-paid cards for retailers and corporate rewards, published its half-year results for the six months to September 30.

Appreciate’s business is seasonal and it traditionally reports a loss in the first half of its financial years. The latest results show a a fall in revenues and an increase in losses as the company was hit by the COVID-19 crisis. It reported revenues of £27.4m, down from £33.2m last year. Pre-tax losses widened to £6.2m from £1.3m.

The firm also reports what it calls ‘billings’. This represents the value of goods and services shipped and invoiced to customers, net of VAT, rebates and discounts. They were also down in the half-year period from £120.2m last year to £98.8m this year.

In its corporate business Appreciate said business from new clients was up 87% to £3.1m, excluding Iceland free school meals partnership. This was driven by demand from clients seeking to thank hard working employee efforts during the pandemic.

The business has successfully enabled summer free school meals through digital vouchers for use at Iceland. And it has continued to expand redemption partners with online and essential retail, adding new brands such as Schuh and Foot Locker.

The Christmas Savings order book is now completed – down 8%, ahead of previous expected levels of 10% due to fewer cancellations over the year. Digital billings almost tripled (+186%) to £24.2m (H1 2019: £8.5m), boosted by its partnership with Iceland.

Chairman Laura Carstensen said that, due to continued COVID-19 disruption and the November lockdown, “significant uncertainties for the second half of the year remain”. But she added Appreciate was now in a stronger position than at the start of the pandemic.

Appreciate has an £15m revolving credit facility with Santander UK put in place providing additional financial flexibility. Its Cash balances, including cash held in trust, at September 30, were £227.3m. The group also returned £300,000 in furlough cash it had claimed from the Government.

Chief executive Ian O’Doherty said: “I am pleased that trading during our critical Q3 trading period is progressing well with Christmas savings orders now fully completed, and that we are in a position to reinstate the dividend for shareholders.

“The decisive actions we took to intensify the focus on digital and accelerate parts of our strategy have led to a steady recovery and now improvement in performance, following the initial shock when lockdown measures were first introduced in March.”