Pensionbee maintains positive earnings as fintech raises cash for US growth

Pensionbee sustained positive adjusted earnings last quarter while the online retirement savings provider raised £20m for US expansion.

The London-listed fintech also reported a jump in revenue for the third quarter to £9m from £6m a year earlier.

The firm is expecting to break even on adjusted earnings before interest, tax, deprecation and amortisation basis (EBITDA) in 2024.

It posted its second consecutive quarter of positive adjusted EBITDA for the third quarter at £1m.

Meanwhile, it posted £5.5bn in assets under administration (AuA), a 41 per cent jump from £3.9bn in September 2023.

The firm has seen £538m in net flows from new customers this year, alongside £153m from existing ones. Customer numbers hit 260,000 at the end of the third quarter after it added 37,000 year on year.

Pensionbee, which floated on the London Stock Exchange in 2021, has seen its stock price more than double this year as it scales up and improves profitability.

The London-based firm aims to take a roughly two per cent share of the UK’s £1.2 trillion pensions market over the next five to 10 years. It also wants to onboard 1m customers and is targeting £20bn to £25bn in AuA.

Separately on Thursday, Pensionbee announced it had raised £20m through a share placing to invest in its fledgling US business.

Pensionbee launched its subsidiary there in July, supported by a partnership with State Street’s investment management division.

The US defined contribution pension market represents some 80 per cent of the global total and is worth around $22.5 trillion.

“We are pleased to see a positive consumer response to our marketing approach and to have developed local features to facilitate easier rollovers,” said chief executive Romi Savova, who founded Pensionbee in 2014.

“The opportunity we have ahead of us, to help millions of Americans enjoy a happy retirement, is transformational for the next decade of PensionBee’s growth.”

Pensionbee is targeting $20bn to $25bn in US defined contribution assets over the next decade to make that unit as important as its UK business.