Trading Update

RNS Number : 3589F

Mind Gym PLC

09 March 2020

 

9 March 2020

Mind Gym plc

 ("Mind Gym" or the "Company" or "Group")  

Coronavirus update and Notice of Further Trading Update

Mind Gym (AIM: MIND), the global provider of human capital and business improvement solutions, today updates the market on its trading performance for its financial year ending 31 March 2020 in light of the COVID-19 virus and gives notice of a further update next month.

Underlying trading remained strong between the half year-end (30 September 2019) and the end of January 2020, however, the Group has since experienced a material impact on revenues from the outbreak of the COVID-19 virus. As the virus has spread from region to region, we have observed an increased number of cancellations of booked sessions from clients and a material reduction in new bookings.

Given the uncertainty about the extent and duration of the virus outbreak, it is difficult to forecast accurately the full year impact, but we currently anticipate revenues to be in the range of a 10-15% increase on the prior year (£46.5m to £48.5m), which is below our  previous expectations of revenue growth for the year. Whilst the Group is focussed on tight cost control, the sudden fall in revenues so close to the end of the financial year provides limited opportunity to reduce planned expenditure and investment. Accordingly, Adjusted PBT is now expected to be between £5.8m and £7.3m. The strong focus on cash continues, and the cash balance at 31 March 2020 is expected to remain in line or above market consensus of £14.0m.

The Group is closely following and regularly monitoring the advice from the World Health Organization ("WHO"), as well as regional and local government advice, and continues to assess the situation carefully. We have taken rapid and decisive actions to mitigate the potential impact including:

· Working with clients and coaches to switch live face-to-face coaching sessions to virtual web-ex sessions

· Promoting our digital proposition as an alternative to live sessions

· Tracking the movement of our staff and coaches and implementing a policy of a minimum two-week self-isolation period

· Minimising travel requirements and accelerating the adoption of remote working practices

As previously planned, the Board will provide a further trading update on its full year results to 31 March 2020 on 27 April 2020.

Octavius Black, Chief Executive Officer of Mind Gym, commented:

" Our primary concern now is the health and welfare of our clients, colleagues and coaches . In a fast-changing environment we continue to assess the impact of COVID-19 on our business, supporting clients with our digital products and managing costs as required. Our cash generative business model and strong cash balance provide resilience during these volatile times. We remain committed to our investment in product and people and are confident that this will deliver long term value to shareholders."

Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No 596/2014) ("MAR") prior to its release as part of this announcement and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

Enquiries

Mind Gym plc	[phone]
Octavius Black (CEO)
Joanne Black (Chair)
Richard Steele (CFO)
Liberum (Nominated Adviser and Sole Broker)	[phone]
Bidhi Bhoma
Joshua Hughes
Euan Brown
Maitland/AMO (for media enquiries)	[phone]
Al Loehnis
Sam Cartwright

[e-mail]  

 

END

 

 

TSTMZGGFMRVGGZZ