Good morning and welcome to the Analyst Call for Ten Lifestyle Group PLC's half- year results for 2022 financial year. Without any further ado, I'll hand over to Alex.
Great. Thank you very much, Kezia. Thank you everybody for coming along. Welcome to the results for the H1 of the financial year. We've got good results and a positive outlook, so looking forward to pressing on. As you know, we're all about becoming the most trusted service in the lives of our mass affluent and high net worth members around the world. The concept behind Ten as an investment is that we're, first of all, an established market leader. In terms of that, well, in this period, we've won new clients, three new clients, one each in the Americas, Europe and Japan, Asia. We've retained every single one of our corporate clients once again. That's for the second or even third period on the trot.
In terms of growth, very pleased to say that we are growing again at over 20%, and we're expecting that kind of growth to continue into next year and beyond as well. I'm really pleased that we've been able to sustain investment into our technology because not only does that make our service better, which leads to more repeat use and drives revenues, and takes us closer to our vision for the business, but it also drives efficiencies and profitability that gets us closer to cash generation, and generates more cash beyond that too.
It's a huge market opportunity because, as we become the best place in the world for high net worth to mass affluent, to organize their travel, dining, going out, and buying premium items as well, that's a huge market opportunity, and we've made some good progress in improving that proposition too. All of that helps us develop a business which gets better, more profitable, higher quality, better service as it gets bigger. Very importantly, since the half- year end at the end of February, and really since the beginning of February when we saw the impact of Omicron start to recede, we've got really strong KPIs. Request activity is up in every single region versus the previous periods.
Net revenue is up above pre-COVID levels. That is led clearly by corporate income, but also by supply revenue, which is now above pre-COVID levels as well. Most of our supply revenue comes from travel partners like hotels, and that's doing very well for us. That's despite the fact that in the last few months we've still got COVID-19 impacting the business in that, for instance, travel is very subdued still in parts of Asia, particularly China and Hong Kong. Japan is still not seeing a lot of international travel at all, for instance. Latin America has been subdued too. The good results in March and April are also notwithstanding the fact that we closed our Moscow office, which was less than 2% of our net revenues.
Obviously that did make a difference. Our revenue results would've been higher if Moscow had stayed open. What that means is that the results in March and April are looking very positive, but we hadn't, in March and April, launched the new programs that we announced earlier in the year. I'm delighted to say that we have launched Schroders in the UK as of today. That's hot off the press. We have announced that contract before. We didn't name it before, but that's actually going live today and the people are being asked to register for that from this morning. We've got another corporate client, the very large bank in the Americas, going live on Thursday this week. It's a very good week for launches.
Most of these launches will make a good difference to next year's numbers. They'll make a difference to the numbers moving forward from May onwards, but they're not in our trading update for March and April. What do we expect to do from here? Well, deliver improved net revenue, improved profitability in the second half of the year, and so that we achieve the expectations out there in the market today and in line with board's expectations for sure. Beyond this year, we are optimistic. Why? We've got very strong contract retention, and many of our contracts still aren't yet at the levels that they were pre-COVID.
We've also had wins during COVID-19 and wins coming up, right, being launched right now, which will make a good impact, and we've got the strongest sales pipeline that we've ever had. We've also got growing supply revenue, which is partly because the cost of travel has gone up, but it's also very much because our success rate at converting, travel requests and other types of requests too is improving as well. The continued investment in tech and proposition really helps us become a high-quality service that drives our metrics in the right direction, and more efficient, which helps us with cash generation and profitability. A couple of other things worth pointing out. We've got a very large member base now, and we're growing that all the time, but what we don't need to do is scale into new markets or new languages.
The scaling that we need to do is pretty much in known areas where we've got existing management team and existing setup. The proposition that we've got in dining, travel, live entertainment and premium retail, it's there on a global basis. Now it's about iterating it. We don't have to do very much in the world in the way of kind of risky newness to continue to scale and improve our proposition. We could double the business and double it again just in financial services, and selling into known markets is likely to be where most of our revenue comes from over the next couple of years.
We're approaching cash generation, and as we do achieve cash generation, we can invest some of that back into the business to speed up the growth and to make the growth that we generate more efficient and more profitable for future success of the business. That's why we're feeling good. Those of you that don't know, everybody on this call has seen the growth engine video, but a reminder that that is worth looking at, and we would expect that at year-end, we'll be able to update that, and that will become more and more compelling in the months and years to come. Alan, over to you.
Thank you, Alex. The first slide I wanna go through is the key financial highlights. Our net revenue did grow in H1. However, we did have a short-term impact on our profitability through Omicron, which I can go through. Net revenue increased by 21% to GBP 20.8 million. We had growth in all three regions, with corporate revenue up 13% to GBP 18.4 million and a strong recovery in supplier revenue, as Alex pointed out, and back to pre-COVID levels at GBP 2.4 million for the period. Our operating expenses did increase due to the increased activity to GBP 19.9 million, as opposed to GBP 15.5 million last year, which did benefit from payroll assistance of GBP 2.1 million, which I'll go into more detail.
As a result, our adjusted EBITDA was slightly below last year at GBP 0.9 million versus GBP 1.7 million. However, our loss before tax did improve at GBP 2.8 million versus GBP 3.6 million last year. We ended with cash in the period at GBP 5.1 million, which is slightly up on what we said at the trading update. We said GBP 4.7 million, but when we closed the month end, there's some cash in transit we account for, and that's the difference. Next slide please, Alex. This is just our income statement. I've got a slide on net revenue next, which I'll go through, so I'll just focus operating expenses. As I said, increased by GBP 4.4 million. Now, that was the removal of payroll assistance.
If you remember, we did some salary sacrifice last year, which saved us cost and cash, and also we took advantage of government support across the globe. That amounts to GBP 2.1 million. We also increased FTE through the period 'cause we saw a strong rebound in activity in the first half of the first quarter of the period. We maintained those resources as Omicron hit November through January, and that's the reason for the increase in expenses. However, they still remain below pre-COVID levels, so if you compare it to H1 2020, before it was GBP 21.7 million. We're now at GBP 19.9 million, and that's where we've driven efficiencies through our business model that's driven that result. Depreciations decreased by GBP 0.5 million. Basically, that's less office space, less lease costs under IFRS 16.
Our share-based payments decreased by GBP 0.5 million because we did not have any salary sacrifice options issued this year compared to last year. Exceptional items were nil. We had a small impairment last year. Net finance income would benefit from FX gains in the period. That resulted in an improved loss before tax of GBP 2.8 million by GBP 0.8 million compared to GBP 3.6 million last year. This is our normal revenue bridge. As I said, we retained all material contracts in the period. Our base corporate revenue did increase by GBP 1 million, despite the impact of Omicron. That would've been higher if Omicron had not hit. Supplier revenue has come back strongly, and I've got a slide next to go through that detail. As global travel restrictions lifted, especially in EMEA, we saw a return to travel.
We did launch some new programs in the period. Majority of that is our Credit Saison new launch that started in September of 2021 in Japan. This is to show how supplier revenue has recovered. The graph just shows that, in H1 2020, which is pre-COVID, GBP 2.5 million, and then COVID-19 hit in H2 2020, and then H1 2021. We saw the sharp decline in activity. We saw the recovery coming back through in the H2 of last year and then coming back strongly in this period to get back to pre-COVID levels.
More importantly, as Alex pointed out, in March and April, we've seen above pre-COVID level performance on supplier revenue, and we're still seeing that coming through in the start of May as well. Net revenue by region, as I said, all regions have grown. EMEA up 15% with base corporate recovering and supplier revenue coming back, albeit slowed by Omicron. Really strong performance Americas, up 40% as the base corporate recovered and supplier revenue came back as well. APAC principally grown because of the Credit Saison new launch in September 2021. Base business recovery continued to be subdued because of the COVID-19 restrictions in that region.
Our adjusted EBITDA by region, EMEA has gone down versus last year as we retained FTE through Omicron, as we believed that was the right thing to do, as it was just a short-term impact on the business. Our actual EBITDA improved in Americas because of the strong recovery on revenue, as I've highlighted. APAC adjusted profit is slightly down on last year. Some cost control measures in there to offset the lower base net revenue that came through in which activity was subdued in the period. This is a normal slide that we show on our technology investment, and we're pleased to say we've continued that investment throughout the COVID-19 period and throughout the last period. Why do we do that?
It creates competitive advantage, and it also drives efficiencies, service levels, and ultimately revenues to the business, and we've been pretty stable in terms of our investment over that period. Lastly, cash flow. Our operating cash flow in the period was GBP 1.4 million. That was driven by our reduced loss before tax and improved working capital with our non-cash items being depreciation, amortization, share-based payments, and exceptional items. We continue to invest in our technology, i.e., intangible investment was GBP 2.9 million. We did receive some cash in the period from exercise of share options and also sale of treasury shares in the period. Our repayment on leases and interest decreased because of our reduced office space, which overall meant that our net decrease in cash was GBP 1.5 million in the period to GBP 5.1 million.
Thank you. I'll hand back to Alex now. Oh, you're on mute, Alex.
Great. Thank you very much, Alan. A reminder, we make our money through a mixture of supplier revenue and corporate revenue, money from our corporate clients. We get paid typically in line with the number of high touch requests we do, where we get paid a larger amount. We get paid less, but typically a higher profit for the digital requests that we do. Pretty much all of the revenue from corporate clients comes in on multi-year contracts, three or five-year contracts that we've got a very good track record of repeating. Really pleasing to see not just revenue coming back, but the number of members using our service is growing again, and that should continue to see improvements as we engage more people coming out of Omicron.
We continue to re-engage with clients on existing contracts and engage with new clients on new contracts too. Operationally, Alan's talked about the fact that we launched Credit Saison in Japan, won three new material contracts in each of the major regions, and also not just retained, but actually resigned quite a few contracts as well. Renewals, for instance, with Barclays, DNB in Norway, St. James’s Place here in the U.K. We've invested to continue to invest in the tech to grow efficiencies, improve the member proposition as well, not only through technology, but also through how we work with different types of supplier. We had a slight dip in member satisfaction in October and November of last year, where we had an influx of requests in many parts of the world.
As everybody thought COVID-19 was over, people were traveling again, busy again, and requests were very complicated to manage at that time, because of the complications, for instance, around travel and eating out. That dip has since recovered in the second half of the period. Really pleased to say we've retained the senior leadership team through this pretty challenging period, because, we're looking forward to growing the business with that team over the next 12 months and beyond. Our corporate client base stays very strong. I'll be delighted at year-end to add Schroders onto this and to be able to tell you who the large private bank in the Americas is. Actually one of the largest wealth managers in Japan will be added onto this as well.
All of those contracts already announced, but not named until Schroders today and the others at a later date. In terms of our core categories, it is really now about iteration. With dining, it's about just improving our access, improving how we manage dining requests, how we talk about them, the events that we host and so on. With tickets, it's about getting more availability at more venues and for more shows. Our members are never happier than when they've got a face value ticket for a sold-out show. That's really what we want to do.
Also gathering many more preferences from our members about what shows and acts and, music styles they never want to miss, to make sure that we can tell them about those events and tell many thousands more every period than in previous periods. At travel, we're getting more and better offers with hotels around the world and airlines, car hire companies. We're also developing our premium travel proposition as well. Retail, I'm really excited about what we can do in retail. It scales very well. It scales very well digitally as well. This is not just things like shopper evenings, where we've now got an RSVP function that automates a lot of that.
It's things like unique codes, so we can generate a code for one member that only they can use, and they can only use it once. That allows luxury brands to work with us at more scale. That's built into our platform and will be one of the reasons why we should have more offers around luxury brands on our platform, which are self-serve in the months to come and beyond. The reason why Inspiration and Book Club are in brackets is that they're not really new categories. Inspiration is content which is typically about dining, entertainment, travel or luxury.
The Book Club was just a good example of something that we innovated during COVID-19, which does generate a good number of requests for us throughout the year, but that we're gonna continue to have as part of our proposition moving forward. Investing in the platform's been really good for us. It is how we tend to sell the business to corporate clients, because while we can talk about the quality of our lifestyle managers, and that's absolutely crucial for the service quality, it's not something that a corporate client can easily evaluate. Whereas we believe we are the only concierge company in the world with a really strong digital proposition. We tend to lead with that in our sales meetings.
Really delighted that we're now very strong with the digital platform in Japan as well as in all of the other markets that we've been in previously. Obviously, Japan is the world's third biggest country in terms of GDP and the number of high-net-worth as well. The platform is doing well for us, and it allows for a lot of customization now. Our platform can look and act very differently for different corporate clients. We can tell the brand story that they want to tell and hit the commercial imperative that they want to hit as well. One side benefit of allowing customization the way we have is that we are increasingly being paid by some of our major corporate clients to build technology and features and to integrate in with them in ways that we didn't previously.
Now, the good thing about that is it adds more value to our corporate clients, and obviously, that's just good thing for the long-term of our business. It also creates a new revenue stream for us as well, which is a very healthy revenue stream to have. One example of that is the single sign-on with HSBC Jade, where Jade is a top-end of retail banking proposition for people that have got, let's say, if you had a million pounds of assets with HSBC, you would qualify for Jade. When you come to your Jade app to make a payment to a supplier or a friend or a family member, you can see Jade Lifestyle right up there.
If you click on that, because you're already logged in, you can go straight into the digital platform without having to set up a password or anything like that. Really very, very good news for us in terms of engagement, and it works very well for the Jade client as well. It's not all about the digital platform. We're also investing into our internal tools, which is chiefly Ten MAID, which lifestyle managers use for most requests, and then our Ten Travel system, which is very travel specific, for booking hotels, flights, and booking them together as well. Our aim is, over a period of time, to make our lifestyle managers 10% more efficient and ideally another 10% more efficient after that. Every time, even in today's business, we make our lifestyle managers 10% more efficient.
That saves the business around GBP 2 million in profitability and cash. It's a good investment for us to be making, and we hope to see the benefits of that on an ongoing basis moving forward. It's an important part of our growth engine. We also have got a lot more sophisticated in terms of how we onboard members and how we recover any members that use us once or twice and then stop using us for whatever reason. We've done a lot of research about why that is and what we could and should do to, one, prevent it in the first place, but two, to reengage people where that does happen.
All of these, given that we get paid by activity and both onboarding and recovery, activate members and keep them activated, keep people using the service, that's very good for our revenues and our profitability. To come back to the slide that we've seen before, you know, we grow our business by retaining our current contracts, growing those contracts through more active members, more usage, integrating more in with those current clients so that they promote us more. We win new clients in financial services, and then we win some new clients in other verticals as well and open up in new geographies. Now, again, I don't expect to be opening up in many new geographies in the next 12 months, but we should have some activity in new verticals.
The bulk of our growth will come from financial services in existing markets. To remind ourselves about where we started the presentation, current trading is very strong. We've seen a really good recovery since the beginning of February. March and April, we're tracking up in a very healthy way, even on top of the good results from H1 in terms of growth. Net revenue is above pre-COVID levels. Supplier revenue, as part of that, is above pre-COVID levels, despite the fact there should be more to come as LAC and APAC continue to escape the pandemic. We've got new launches that will help us as well.
Now we expect to deliver improved net revenue, improved profitability in the second half to achieve the expectations we have in the market, and then to continue to develop the business and grow the business into 2023 and beyond. Thank you, everybody. That is an overview of where the business is at right now.