Moneysupermarket FY profit drops amid weakness in insurance, home services

In the year to the end of December, pre-tax profit fell £70.2m from £87.8m, with revenue down 8% to £316.7m. Basic earnings per share were 24% lower at 9.8p. Adjusted earnings before interest, taxes, depreciation and amortisation declined 7% from the prior year to £100.5m.

The group declared a final dividend of 11.71p a share, in line with the previous year.

The money business saw revenues grow 20% to £75.2m. However, revenue from insurance dropped 8% to £158.7m and home services revenue slumped 34% to £68.1m, while travel saw a 32% fall to £4.1m.

The company said car and home insurance revenue fell in a "softer but highly competitive switching market". This was partly offset by travel insurance, which saw revenue near pre-pandemic levels for much of the final quarter.

In home services, high wholesale energy prices meant there were no switchable energy tariffs available from October. "Wholesale energy prices remain too high to return attractive switching tariffs to the market, despite the increase in the energy price cap," Moneysupermarket said. "We remain confident that the energy switching market will return strongly in the medium term but assume no energy revenue in 2022. We nonetheless expect 2022 adjusted EBITDA to increase to around 2020 levels."

Chief executive officer Peter Duffy said: "In a tough year for some of our markets, we delivered well against our strategy. Our work to attract customers more efficiently led to margin improvements, and our transition to a leading, flexible tech and data platform is on track. We're building a more dynamic and efficient organisation, with better pace of delivery.

"We've added new brands, welcoming colleagues from CYTI, Icelolly.com and Quidco. The addition of cashback aligns well with our purpose of helping households save money and brings new opportunities."

At 1540 GMT, the shares were up 2.8% at 192.20p.

AJ Bell financial analyst Danni Hewson said: "At least the travel business is picking up as Covid restrictions are eased and the insurance and money categories are seen as being in a relatively decent place too.

"If households can’t save money on energy there is at least a prospect that they will turn to Moneysupermarket to pursue cheaper deals on broadband, loans as well as credit cards and insurance.

"However, in a rising interest rate environment cheap deals on financial products are likely to be less prevalent.

"Moneysupermarket needs to focus on the things it can control, protecting its share of a competitive market with smart marketing spend and delivering innovation which makes customers’ lives easier through areas like automated switching."