Home » News » PLC News » JTC plc strong performance with revenue up 15.2% to £53.7 million

JTC plc strong performance with revenue up 15.2% to £53.7 million

JTC plc (LON:JTC) has announced its interim results for the six months ended 30 June 2020.

 As reported
H1 2020
As reported
H1 2019
As reported
H1 2020
H1 2019
Revenue (£m)53.746.6+15.2%53.746.6+15.2%
EBITDA (£m)16.715.7+6.1%17.916.1+11.2%
EBITDA margin (%)31.0%33.7%-2.7pp33.3%34.5% -1.2pp
Operating profit/EBIT (£m)10.210.7-4.7%11.511.1+3.0%
Profit before tax (£m)10.49.0+14.7%11.69.5+22.1%
Earnings per share (p)*8.627.09+21.6%12.039.61+25.2%
Cash conversion93%82%+11.0pp108%103% +5.0pp
Net debt (£m)(70.5)(63.9)-6.6(68.0)(60.9) -7.1
Interim dividend per share (p)2.41.7 +41.2%2.41.7 +41.2%

*Average number of shares for 6 months to 30 June 2020: 114,350,893 (12 months ending 2019: 111,352,868).


·      Revenue up 15.2% to £53.7m (H1 2019: £46.6m), reflecting a combination of strong net organic growth (+10.1%) and growth from acquisitions (+5.1%)

·      Underlying EBITDA up 11.2% to £17.9m (H1 2019: £16.1m) with underlying EBITDA margin down 1.2pp to 33.3% (H1 2019: 34.5%)

·      Annualised new business wins totaling £8.6m, including NESF, (H1 2019: £5.9m) with substantial new mandates won during the period

·      Net debt at period end of 2.0x underlying proforma EBITDA (H1 2019: 1.9x) reflecting our acquisition activity during the period

·      Underlying cash conversion of 108% (H1 2019: 103%)

·      Interim dividend increased 41.2% to 2.4p (H1 2019: 1.7p)


·      JTC’s highly resilient business model has allowed the business to perform well during the first half of the year during a period of global turmoil

·      Strong all round performance from the Private Client Services (PCS) Division and substantial new business wins in the Institutional Client Services (ICS) Division

·      Acquired the Sanne private client business in Jersey (1 July 2020) and technology-enabled fund administration business NES Financial (NESF) in the US (29 April 2020). Also acquired a small bolt-on in the UK (Registrar Services) and established a presence in Ireland on a greenfield basis with a new office in Dublin (Corporate Services)

·      M&A pipeline remains healthy and our disciplined approach will continue


·      The Group has traded broadly in line with Board expectations

·      JTC’s medium term guidance metrics at Group level remain unchanged:

  • 8% – 10% net organic revenue growth per annum
  • Underlying EBITDA margin of 33% – 38%
  • Net debt of up to 2.0x underlying EBITDA
  • Cash conversion in the range 85% – 90%

·      Ongoing integration of acquisitions made in H1 2020, with particular focus on NESF in the US and the application of acquired technology capabilities across the wider Group.

·      The Group’s established platform will enable further operational efficiencies, especially in the fund services practice of the ICS division, and to also allow it to take advantage of consolidation opportunities.

·      Continued positive growth prospects for the Group, underpinned by long-term fundamental drivers for our industry

Nigel Le Quesne, Chief Executive Officer of JTC PLC, said:

“In the first half of 2020 we all faced extreme challenges at very short notice. At JTC our priorities were the safety of our people, uninterrupted service for our clients and maintaining the long-term performance of the Group. The strong results delivered in H1 are testament to the highly resilient nature of our business, the outstanding quality of our people and the loyalty of our client base.

Based on our more than 30 years’ experience, our outlook remains positive. We will continue to focus on the smooth integration of the Sanne private client and NESF businesses while simultaneously working to grow the Group through client service excellence, improving operational efficiencies and making even greater use of technology. We will also remain open to acquisition opportunities that fit our disciplined approach to inorganic growth.”



The first half of 2020 presented unique challenges that ultimately proved just how resilient and well-constructed our business is. We often reference our long track record spanning more than 30 years and experience in successfully navigating external shocks and volatility and so it has proved again during the Covid-19 pandemic. Our shared ownership culture came to the fore as our outstanding global team ensured that client service continued seamlessly and despite restrictions on certain aspects of business development activity, we grew strongly during the period in terms of net organic growth and new business wins. We were also able to acquire NESF and a smaller ICS bolt-on in the period and the Sanne PCS business immediately post period end. We continue to see many acquisition opportunities and, if anything, our potential pipeline is even stronger than at the beginning of the year. The fundamental drivers of our industry remain valid and we see good opportunities for both organic and inorganic growth in the second half of the year and beyond.


Our H1 2020 results are in line with our expectations and we have seen good momentum in the period across both divisions. In comparing to the same period last year, Group revenue increased by 15.2% to £53.7m (H1 2019: 46.6m), the annualised value of new business won was up 46% to £8.6m (H1 2019: £5.9m) and underlying EBITDA increased by 11.2% to £17.9m (H1 2019: £16.1m). It is worth noting that due to the timing of acquisitions, the growth seen during the period was predominantly driven by the core business, with net organic revenue growth of 10.1%, which is at the top end of our guidance range and a 1.9pp increase on the 8.2% recorded in the 12 months to 30 June 2019. Our underlying EBITDA margin fell slightly to 33.3% (H1 2019: 34.5%) but is still within our guidance range of 33% – 38%. The cause was weaker margin performance in our ICS Division and explained in more detail below is the work that is underway to bring ICS margins back in line with Group targets. The net debt at the period end was 2.0x proforma underlying EBITDA (H1 2019: 1.9x) and underlying cash conversion was strong at 108% (H1 2019: 103%).

Our outlook is positive and we maintain our medium term guidance, namely: 8%-10% net organic revenue growth per annum at Group level; underlying EBITDA margin of 33%-38% at Group level; net debt of up to 2.0x underlying EBITDA and annual cash conversion in the range 85%-90%.

I am also pleased that we have been able to increase our interim dividend by 41.2% to 2.4p per share (H1 2019: 1.7p).  


Gross revenue showed a 19.6% increase in the period to £30.3m (H1 2019: £25.4m) but disappointingly, underlying EBITDA was flat at £8.2m (H1 2019: £8.2m) and underlying EBITDA margin fell 5.1pp to 27.1% (H1 2019: 32.2%).

Turning first to revenue growth, this was a success driven by an effective business development and marketing programme that pivoted rapidly to adapt to remote working conditions. Last twelve months (LTM) organic revenue growth was 8.9% (H1 2019 LTM: 12.3%) and the annualised value of new business won during H1 2020 was £6.9m, an increase of 116% over the H1 2019 figure of £3.2m. We have seen positive trends for win rate and average mandate size and the new work won in the period demonstrates the quality of our new business pipeline at the time of ‘lockdown’ and the strength of our relationships with existing clients and intermediaries who refer business to JTC. The ICS organic new business pipeline at 30 June 2020 was up 32% at £29.3m (H1 2019: £22.2m) and we continue to be invited to tender for mandates of £1m+ pa on a regular basis.

With regard to the fall in underlying EBITDA margin, we have taken the opportunity presented by the external environment to focus internally and have started to implement a revised operating model into our fund services practice supported by a greater reliance on technology to deliver efficiencies. In the short-term this has had an adverse effect on the ICS margin, which we anticipated, but once implemented (within the next 6-12 months) we are confident that there are increasing efficiencies to be found in the servicing of this growing book providing a scalable platform and working model for future expansion.

We purchased a small bolt-on business in the UK that adds Registrar Services to our offering. We have also expanded our footprint to Ireland for the first time, where we will commence with Corporate Services before expanding into Fund Services once relevant regulatory approvals have been secured.

The acquisition of NES Financial (NESF), a technology-enabled fund administration business, provided an important strategic entry into the US, which is a key growth market for the industry and in particular the alternative fund administration sector. The pace of integration has been slower than normal due to remote working restrictions and the business itself has faced a number of Covid-19 related headwinds as market conditions have temporarily impacted fund raising for existing NESF clients as well as slowing the rate of new fund launches. The low interest rate environment and impending US elections in November are also acting as a general drag on market confidence in the US and the markets served by NESF, further slowing activity levels. As such, we believe the direct financial benefit of the transaction will only begin to come through in 2021. More generally, we are making good progress with the very capable NESF management team to develop the business and integrate it into the global JTC platform. The technology capabilities of NESF are starting to be leveraged in both Divisions to enhance the client experience, improve processes and deliver efficiencies all of which will make an increasing impact over time.

The ICS Division enjoys strong market fundamentals and we will continue to invest in the platform to deliver organic growth and to capitalise on the technology capabilities brought by the NESF acquisition. The work to improve the margin is well underway and we expect to see positive changes in the second half of the year.


Gross revenue showed a 10.0% increase in the period to £23.4m (H1 2019: £21.2m) and underlying EBITDA increased by 22.1% to £9.7m (H1 2019: £7.9m). Underlying EBITDA margin increased by 4.2pp to 41.4% (H1 2019: 37.2%).

Revenue growth was good, with particularly strong LTM organic revenue growth of 11.8% (H1 2019: 2.3%) demonstrating the ability of the PCS Division to develop and grow the core client book. Indeed, the number of client mandates generating in excess of £100k pa in fees increased by 21.8% period on period as clients took more services from the PCS Division, including our innovative JTC Private Office offering. The annualised value of new business won during the period was slightly disappointing at £1.7m (H1 2019: £2.7m) and this reflects the more personal nature of PCS work in general, with many clients and intermediaries unable to travel or attend in-person meetings due to Covid-19 restrictions. However, the organic new business pipeline at 30 June 2020 was £13.3m (H1 2019: £11.0m) which augurs well for the second half of the year.

Margin improvement was strong with the PCS Division now operating consistently at or beyond the top end of our Group guidance range of 33% – 38%, driven by a highly efficient operating model.  

Immediately post period end on 1 July 2020, we purchased the Sanne private client business in Jersey, which has delivered a high quality client book supported by an experienced group of employees. Clients representing annualised ongoing revenues of £4.1m transferred to JTC resulting in a cash payment of £9m. Our ability to rapidly integrate the business into our Jersey office, despite having to do this on a virtual basis, is further evidence of the rationale for this straightforward deal. Moving forward, our award winning PCS team will provide fresh impetus and positivity and we have already seen material cross selling activity within the acquired book, including engagement with our JTC Private Office and treasury services. We believe that the acquisition price will ultimately represent only a low single digit multiple of the EBITDA that it generates for the Group.

The PCS Division continues to be a clear leader in its sector and we see multiple opportunities for further investment and growth. We will enhance our Edge client portal, which forms part of the JTC Private Office proposition, using technology acquired in the NESF transaction and will also continue to leverage a range of ‘first cousin’ services, including: treasury, custody, FX and tax compliance to drive organic growth.


We maintained our disciplined approach to acquisitions and during the period completed the NESF transaction as well as a small bolt-on deal and immediately post-period end completed the Sanne PCS transaction, as detailed in the Divisional sections above.

More generally, we continue to regard the sector as being in a period of consolidation and have an active global pipeline of M&A opportunities of varying sizes and stages of development. The impact of the Covid-19 pandemic on acquisition opportunities and pricing is still evolving, but following an initial hiatus of several months, we are now seeing an increase in activity levels with deal flow back to, or even exceeding, levels seen at the beginning of the year pre-pandemic.

We believe there will be opportunities to make acquisitions at attractive price points that fit with our disciplined approach and commitment to both the ICS and PCS Divisions. As ever, always knowing when to say no remains a key JTC attribute.  


Our shared ownership culture has always been at the heart of JTC and in 2020 it came into its own. The Covid-19 pandemic required an almost overnight shift to remote working for our more than 900 employees worldwide and their collective response has been nothing short of outstanding. The team spirit, ingenuity, commitment and professionalism displayed by the team at JTC has allowed us to not only provide a seamless and uninterrupted service to clients, but has enabled the business to grow and develop through a period of incredible challenge and uncertainty. As already noted, we even managed to successfully progress two major acquisitions under lockdown conditions, a testament to the skill and tenacity of our people.

While some of our 23 offices are now fully or partially back to ‘normal’ working, we anticipate that the impact of the pandemic on our people and their working arrangements will be felt for some time to come. At JTC we pride ourselves on being innovative and solutions orientated and new processes and adoption of technology that have been accelerated through necessity are now in the process of being formally adopted as long-term working practices, to the benefit of our people, our clients and the long-term success of JTC plc.

Our people continue to be our most important asset and personally, and on behalf of the Board, I would like to thank all members of the team for their contribution in the first half of the year and their continued dedication to JTC.


The principal risks facing the Group remain as set out in our 2019 Annual Report. Ongoing material risks include acquisition risk, client risk, data protection and cyber security risk, staff resourcing risk, political and regulatory change risk, and regulatory and procedural compliance risk. The Covid-19 pandemic presents a particular set of risks at the present time and we believe that the business has demonstrated great resilience to date in this regard. Overall, we remain satisfied as to the effectiveness of the Group’s risk analysis, management and culture, developed over more than 30 years of JTC operations.


The Board has recommended an interim dividend of 2.4p per share, an increase of 41.2% period on period (H1 2019: 1.7p). The interim dividend will be paid on 23 October 2020 to shareholders on the register as at close of business on the record date of 25 September 2020.


We are pleased with the results delivered in the period and in particular the net organic growth of the business and the growth in both revenue and underlying EBITDA. The strong results are testament to the highly resilient and defensive nature of our business, the outstanding quality of our people and the loyalty of our client base and as such our guidance metrics remain unchanged and we increase our dividend pay-out ratio guidance from 25% of underlying earnings per share to 30%.

Although overall margin at Group level was at the lower end of our expectations, a particular area of focus going forward will be on the implementation of the revised operating model of our fund services business within the ICS Division. The PCS Division continues to build on its recent success and has a clear path to maintain that momentum.

We will continue to focus on the smooth integration of both Sanne and NESF in the second half of the year, although we recognise that there will be challenges due to the impact of the Covid-19 pandemic, in particular for the NESF business and we remain open to opportunities that fit our disciplined approach to inorganic growth.

Our long-term outlook for our business and industry is positive, despite Covid-19, and we see good organic and inorganic growth opportunities for both Divisions.



Join us on our new LinkedIn page

Follow us on LinkedIn