Good afternoon and welcome to PensionBee's Q4 2025 results announcement, covering trading for the period ending 31 December 2025. I'm Romi Savova, the CEO of PensionBee Group. For those of you who are new to the PensionBee story, we are creating a global leader in the consumer retirement market. We exist to help our customers prepare for and enjoy a happy retirement. We enable our customers to combine their old retirement accounts into a new online plan. We enable them to make contributions, to invest in line with their objectives with money managed by the world's largest asset managers, and ultimately to withdraw and spend their retirement savings. Our aspiration is to build a lifetime relationship with our customers, generating predictable and scalable revenue and profit for our company and for our shareholders.
We are pleased with the results of the fourth quarter, which reflect strong execution in the U.K. and in the U.S. As is expected for the medium term, the United Kingdom made up the bulk of assets and invested customers. The U.K. closed the quarter with assets under administration of GBP 7.4 billion, representing 27% year-on-year growth, annual run rate revenue of over GBP 50 million, representing 33% year-on-year growth, and approximately 305,000 invested customers. Over the fourth quarter, we increased marketing expenditure to GBP 2 million compared to GBP 1.2 million in the fourth quarter of 2024, positioning the business for continued ramp-up in marketing-led growth in 2026 and beyond. The investment drove U.K. customer growth of 37% over the quarter, with 8,000 new invested customers onboarded, underscoring the effectiveness of our growing marketing expenditure. Overall, we onboarded approximately 40,000 customers in 2025, increasing the number of net new customers relative to 2024.
We continue to invest in productivity, introducing new automations and efficiencies across our technology platform. We generated a productivity improvement of 22% year-on-year, with each staff member supporting 1,621 invested customers. We are well positioned for 2026 with the launch of our new and refreshed BeeHive experience, which will soon include the introduction of AI-powered chat in the app, further enhancing our long-term productivity. The U.K. achieved Adjusted EBITDA profitability of GBP 3.4 million, with a 26% Adjusted EBITDA margin for the quarter, underscoring our commitment to profitable growth in the U.K. The U.K. also supported growth profitability for the year overall. Turning to the United States, over the fourth quarter of 2025, we have continued to focus on establishing a strong foundation for long-term growth. Our first advertising campaign concluded successfully, delivering a meaningful uplift in brand awareness in the markets where billboard advertising was deployed.
Our home location of New York saw prompted brand awareness of 12%, Seattle at 9%, and Chicago at 6%. This heightened visibility converted broader market interest into a healthy customer pipeline, which we can see continues to convert over time. The company maintained its product-led growth strategy, enhancing the customer experience through the introduction of performance analytics, giving customers greater visibility of investment returns and improving transparency. PensionBee is now entering 2026 poised for growth, supported by strong early interest in our 1% Match initiative, which is designed to accelerate the company's path to $1 billion of AUA in the U.S., as well as a number of new distribution partnerships. PensionBee has successfully secured its inaugural Safe Harbor IRA contracts, and initial clients are in the process of being onboarded, while additional clients are in the final stages of discussion.
I would now like to hand over to Christoph Martin, PensionBee CFO, who will cover the financial update.
Thank you very much, Romi. Hello, and a warm welcome to everyone. I'm pleased to cover the financial section of the Q4 trading update. In Q4 2025, PensionBee had strong financial performance with 27% year-on-year growth in our AUA to GBP 7.4 billion and a 33% year-on-year growth in ARR to approximately GBP 51 million. This top-line growth, coupled with continuous cost discipline, led to an improvement in our Adjusted EBITDA margin, with the group achieving profitability of GBP 2 million at a 16% group EBITDA margin for the quarter, driven by U.K. Adjusted EBITDA profitability of GBP 3.4 million at a 26% margin for the quarter. These continuous achievements are derived from the core value drivers of our business, which are first, predictable and recurring revenue, and second, business scalability. Furthermore, they are a testament to our ability to consistently and reliably execute against our public market guidance.
The first value driver is PensionBee's predictable and recurring revenue, which is generated from a durable base of assets and administration, a function of the assets of existing and new customers. In Q4, we experienced a 27% year-on-year AUA growth to GBP 7.4 billion. The vast majority of the AUA base is derived from existing customers. Those are customers who remain with PensionBee for a long period of time and continue to build up their pension savings with us, resulting in value generation for decades to come. Our average customer is in their early 40s, and they build up their pension savings with PensionBee, which means that cohorts on an underlying value basis, so that is before any impact on capital markets, are resilient over time. AUAs are derived from new customers acquired through our proven cost-disciplined approach to new customer acquisition.
Over Q4 2025, we onboarded circa 8,000 new invested customers onto our technology platform, representing a 37% year-on-year growth. Over 2025, customers joining were slightly younger than in 2024, aged approximately 39.7, and so last the year before, in 2024, it was 40.6, so approximately one year younger, in line with our marketing strategy for 2025. The younger customer cohorts acquired resulted in a slightly lower average balance of new customers this year compared to the previous year. As a result, the compounding AUA base is subsequently converted into our revenue growth, owing to our resilient gross revenue margin. In Q4 2025, we saw a revenue margin of circa 65 basis points, which enabled us to convert the 27% year-on-year AUA growth into quarterly revenue growth of 34% and annual run rate revenue of 33%.
In conclusion, thanks to our compounding AUA base and resilient revenue margin, we have generated predictable and recurring revenue, which represents PensionBee's first value driver. The second value driver is PensionBee's business scalability due to the controllable nature of the cost base. Our cost base has continued to decline as a proportion of revenue. These scalability dynamics of predictable and recurring top-line growth, coupled with cost discipline, led to an improvement in operating margin. On a 2025 basis, Adjusted EBITDA margin improved to 11%, up from 7% in 2024 for the United Kingdom. Furthermore, the operating margin pre-marketing, so this is a measure of scalability for the U.K., improved to 39%, up by 6 percentage points from 33% last year, reflecting the inherent strong scalability and margin potential of the business.
Reflecting on our long-term track record, PensionBee has delivered a revenue growth since our IPO of compound annual growth rate of 48% to December 2025 and strong margin expansion in the U.K., with Adjusted EBITDA margin improving from - 166% pre-IPO to + 11% today. Furthermore, operating margin pre-marketing improved from - 35% pre-IPO to + 39% over 2025 in the U.K. This underscores the strong delivery against our growth and business scalability objectives. With respect to our guidance framework for PensionBee as a group, we have outlined the short, medium, and long-term targets. So by the end of 2029, we expect the group revenue to be above GBP 100 million and Adjusted EBITDA margin of circa 20% by the year end 2029, with the U.K. considerably contributing to those targets.
By the year end 2034, we expect the group to generate above GBP 250 million in revenue and an Adjusted EBITDA margin of circa 50%. Our circa GBP33 million in cash balance puts PensionBee into a strong position to further scale the U.K. business as well as invest in the tremendous U.S. market opportunity, continuing to execute on our long-term strategy and delivering our public market guidance. I would now like to hand back to Romi for concluding remarks.
Thank you very much, Christoph. We are very pleased to be concluding the fourth quarter on a high note and are very excited about the 2026 plans ahead, both for the United Kingdom and also for the United States. We'd now like to open up to questions.
Fantastic. Romi, Christoph, thank you very much indeed for the update. Just while the team take a few minutes to review those questions submitted there, I'd just like to remind all the attendees that you can please continue to submit your questions, and we'll have available the presentation on the platform as well. Romi, perhaps if I can just start with the first question. Gautam, thank you. It comes in three parts, so I'll break them out for you. The first one is, can I please ask about the take rates, which were slightly higher in Q4? Anything to be mindful of?
Christoph, one for you.
The take rates, can you maybe ask a question of how this would be defined? Is this a new invested customer number? Maybe someone can clarify.
Let me see if Gautam can clarify that point. Let me just hit the second part of that question. CAC year-on-year was a touch higher as well. What are the drivers? How should we think about CAC long-term?
Yeah, happy to take the second one, so the CAC, so the way of how we think about marketing and customer acquisition is basically to drive growth, and so CAC is a very important measure for that that we look at and where we have a self-imposed threshold of GBP 250, which we are at at the end of 2025, but another way that we're also looking at is what is the return on that CAC? And so a way of, again, thinking about we spend marketing to drive growth, and so in other words, is we spend marketing and we get gross inflows.
If you're looking at the gross inflows and divide them by marketing, so you get basically what is the gross inflows that you get for each pound of marketing spend. What you will find actually that the business model is very, very predictable because the gross inflows per marketing pound spend for 2025 was 114, and the average age of the customer that they acquired was 39.7. If you look actually two years back in 2023, the average age of the customer that they acquired was 39.5, so roughly the same age, and the gross inflows per marketing spend was 120. That means actually, and then last year, where the average age was 40.5, the gross inflows were 145. The years before where it was lower, the gross inflows per marketing spend was lower.
So that tells us that actually if we are very mindful of what is the demographic and the average age of the customer cohort that we acquire, it gives us a really reliable and predictable indicator of what the gross inflows return would be as a proportion of marketing spend. So that's the second way that we're looking at, and I think that tells us a lot about the predictability of the nature of the business.
Fantastic. Thanks, Christoph. And the final part of the question, how is U.S. expansion tracking to your internal plan? Should we expect to see material revenues from the U.S. in 2026? How will costs track against this?
Great question on the U.S. The U.S. is, of course, still in the early phases of its development, and I would point you towards the medium-term guidance that we have for the group overall. The medium-term guidance, of course, sees us achieving a GBP 100 million revenue marker with a 20% EBITDA margin, and I think, as you can see from the numbers that we've reported today, simply kind of doing more of what we have currently been doing would very much kind of be in line with the achievement of that guidance, and so when it comes to the U.S., we will continue to focus on the kind of key development milestones that we see for the business over the 2026 timeframe.
That includes establishing the direct-to-consumer repeatable marketing funnel, which we are now starting to see coming through on the back of the advertising that we did last year, but also with the B2B contracts on the Safe Harbor IRA side, where we have signed the first ones and are in the process of onboarding. And so you can expect to see quite a lot of progress on the U.S. in terms of initial milestones being reported over 2026. I would, as I have done in the past, contextualize the U.S. business with the goal of, and our goal of, growing it more quickly than we grew the U.K. business at a similar stage of its development. Some relevant milestones there. It took us about a year and a half to acquire the first U.K. customer. Within two years, we had about GBP 20 million of AUA.
Within three years, we had about GBP 100 million of AUA. So I think that you can see us moving the U.S. business much faster against those initial milestones. I think that that's what we will be reporting against as we scale it up to a meaningful level.
Fantastic.
Yeah, can I maybe add one point? I think there was also a question on the cost. And I think the key point to highlight there is that we approach the U.S. in a really, let's say, capital disciplined and de-risk approach, generating a lot of synergies, number one, from the technology platform that we have developed in the U.K. and bringing it over to the U.S., and as well as having the commercial relationship with our local partner who funds the marketing investment. And then the third one is the 1% Match that we're rolling out. And you need to be mindful is that that 1% Match, yes, it comes from our balance sheet, but what you actually get is a highly predictable return from it because, or minimum return from it, because the requirement for the 1% Match is a 5% hold.
And so that means that is already paying back your acquisition costs as well as generating some returns on it. To quantify this a little bit, so the U.S. for the full year was an investment of GBP 4.5 million. There was some transfer pricing in those numbers. So if you take that out and look at the pure cash number, it was about GBP 3 million. So that means actually we spent a low single digit for expansion to tap into the world's largest pension market. So that's number one. And then included in the number as well is a GBP 3.8 million investment in marketing. But again, this got refunded thanks to the relationship that we have with our partner.
So I think one thing to be very mindful of is how we approach the U.S. expansion in a very capital-disciplined way and therefore also de-risk that expansion by being very mindful, generating synergies, having a very interesting commercial agreement, and then the structure around the 1% Match.
Fantastic. Thank you very much indeed. Next one we've got here, what are the key operational levers to reach your medium-term target of 20%? I think you've covered some of these on the way through, but if there's anything further to add.
Yeah, I'm happy to take this one. So the levers to get to our 20% target, it is really almost embedded in the business itself because PensionBee is, of course, a growth story. So we will continue growing in the U.K. as strongly as we can. So we have publicly said we actually reinvest our profit back into the business to accelerate growth and drive growth there. And so you actually see very clearly when you're looking at the scalability metrics and one proxy you can look at is what is the profitability as a percentage of revenue and actually track, see how this tracks over time because this gives an indication of how strong the operating leverage is in the business. I made a reference around profitability before marketing because that is really looking at the underlying platform itself, irrespective of how much we actually spend on growth.
If you're looking at that Adjusted EBITDA, so pre-marketing margin, basically pre-IPO, it was - 35%. And this year, 2025, it is 39%. So that tells you that as we grow the top line, given the high retention rate of our cohorts and the compounded nature of the asset base and conversion to revenue, the top line is highly predictable and recurring in nature. And then at the same time, the cost base is growing at a much slower clip compared to the top line, and that generates this operating leverage. And so this is probably the biggest lever is continuing investing in growth, continuing cost discipline, and doing more of the same, really, of what we have already achieved since IPO consistently year after year to just driving that operating leverage and that scalability further.
Fantastic. Thank you. Question from Paul. Marketing spend in Q4 fell to GBP 2 million from 2.6 in Q3, but new customers also fell roughly in the same proportion. Could you explain why you let the marketing spend and new customers fall? Wouldn't it be better to spend a bit more on marketing and keep the new customer growth momentum?
It's a great question in terms of marketing spend. I think one of the points that is highlighted through the question is very much how marketing spend and new customer growth are correlated. And that really points to the predictability of the revenue model and how we drive increasing customer growth, increasing revenue growth in a very, very big market. In terms of Q4 in particular, I would say that Q4 is quite a special quarter for a number of reasons. Q4 last year was, of course, kind of the time where we were eagerly anticipating a budget from the U.K. government. It's also the run-up to Christmas. And so advertising decisions can be made around some of the bigger events.
Normally in Q4, you would seasonally see us spending a little bit less than we do in, say, Q1 and Q2 because of the timing and the nature around the sentiment of personal finances in particular. Certainly what you can see in Q4 at the end of last year compared to the year before that is that we continue to increase the level of marketing spend on a relative historical basis. We expect that to, of course, be positive as we move into 2026 because ultimately we are investing in current customer growth, but also in future customer growth when we spend on marketing. We're pleased to be able to continue that momentum of increasing the marketing budget at the end of last year, but also into 2026.
Thank you very much. Next question from William. Thank you, William. In 2026, what level of growth do you expect you can achieve in U.K. customer numbers from the 305,000 and net flows from GBP 809 million?
Yeah, very happy to take this one. So if you take a step back and you're looking at our medium-term guidance, so the GBP 100 million by 2029, and you back out or you apply also our average pot size guidance, which was GBP 20,000-GBP 25,000 per customer, you get to a number of around GBP 600,000 by the end of 2029. And so I think the way of how we get to where we are today to that point is by increasing that net edge every year a little bit more, roughly by GBP 10,000. And I think this year for 2026, we will probably expect the net edge to be around GBP 50,000-GBP 55,000. Let's put it this way. And then also you need to be mindful that's on the back of, again, discipline in the acquisition costs per customer, as well as an increase in the marketing spend.
Because as we just alluded to earlier, the more we scale, the more underlying profitability we generate and that we reinvest back into the business. So I think the expectation for this year is probably to increase the marketing budget, as we have said in the past, to around mid-double digit teens and therefore drive the customer number. Then on the net flows, I think the way of how you can think about in certain building blocks is looking at gross inflows, gross outflows, and markets. The market assessment I would kindly leave up to the analyst, but on the other two, I think we can give a little bit more color around them.
On the outflows, what you actually see is that the model is quite predictable because if you're looking at outflows as a percentage of beginning of period balance of the AUA base, you see that it is around 10% in 2025, but it was also around 10% the prior year. And then when you're looking at from 2019 to 2024, I think it was always the average was always about 10%. So this 10% is a very consistent, let's say, number. And then it depends, and then it becomes how much gross inflows are we driving. And so there you have the marketing number. We target for 2026 probably a slightly older demographic compared to 2025. So that means that that gross inflow per each marketing pound we spend would probably be expected to be larger than it was in 2025.
So if you bring those building blocks together, that should give you a very informed answer around your net flows.
Thank you. And William has two further passed to William's questions. Second part is, of the net increase in U.K. customers of 40,000, what was the gross addition and the gross loss? Applying a 5% attrition rate from your reported retention ratio would imply a loss of customers about 13,000. Does that sound right? What are you learning from customers who leave PensionBee?
Yeah, maybe I can quickly take the definition point. So please be reminded that the value retention is around 96%, to be very precise. So the attrition is around 4%. And then if you apply the 4% to the average IC number over the year and apply this to the 4%, you get to around, let's say, very low double digits, around the 10,000, 11,000 mark rather than the, I think, 13,000 that you asked. So it's a little bit lower because the retention is higher than 95% if you actually look at the actual number. And then in terms of what we are learning from the customers that do leave, as you know, we are running various qualitative and quantitative analysis. And I think what we continuously see is that there's various idiosyncratic reasons of our customer leaving. Some want to consolidate with the workplace pension.
Some are happy to pay a premium price to go to an advisor. Some want to have a very specific asset exposure. So there tends to be various idiosyncratic reasons for us. But I think the point is really when you're looking at the retention rate over the long run, it is quite resilient. It is quite stable. We reported greater than 95% retention on a value and volume basis since inception. So I think if we're looking at those numbers and it tells us that actually overall, the vast majority of the customers are actually quite happy.
Fantastic. Thanks, Christoph. Final part to William's questions. When do you think you'll have U.S. stats like customers, flows, and revenue that we may be able to disclose?
I'm happy to take this one. Yeah, I think we're really excited about 2026. As you know, we secured our first B2B client. So I think we're very excited about onboarding our first clients. And I think that will help us getting the snowball rolling and acquiring more clients in that new distribution channel. And then also on the B2C side, the 1% Match is something that we place a little bit more prominently in the advertisement. And so I think we're really excited about that as well. And I think once we see that ramp-up coming and we see the materiality of the numbers to come through, then we would place a little bit of a closer look at them and would also embed them a little bit more closer in the reporting.
Thanks, Christoph. Jude from RBC, two questions. Thank you, Jude. On the U.S., can you add any color around the impact of flows from the Safe Harbor onboarding for Q1 2026? There's nothing further to add there. On the second part, on the U.K., it looks like your average new customer balance was a bit higher quarter on quarter. Was that driven by anything in particular? And how do you see that progressing next year? I think some of the points you've touched on, but if there's anything further you can just expand to.
Very happy to start with some of these questions. On the U.S., we'd like to add some color on kind of the Safe Harbor IRA contracts that we've been signing. These are the initial employers that we're onboarding. We are starting with some of the smaller and medium-sized employers. And so the level of flow will, of course, mirror the size of the employer that we begin with. That being said, relative to the starting point, you will see a meaningful change in net flows and in AUA in the U.S. And we'll have some more details for you on that at the end of the first quarter. And then on the U.K. question, it looks like the average new customer balance was a bit higher Q on Q. Was that driven by anything in particular?
Customer balance in general is pretty consistently driven by the average age of the cohorts that we onboard, which in and of itself can then be driven by specific marketing channels. Q4 tends to be a very SEO and organic-heavy quarter. It's usually a quarter where we spend less on paid acquisition channels. And therefore, you usually do see a slightly older customer coming through. And so the changes in customer balance can generally be explained by the age of the customer cohorts.
Fantastic. Thank you. Just a follow-up from William. U.K. read across of 100 million AUA after year three in the U.S. would seem like a really low ambition. I know you said you should be ahead of this, but I'd assume considerably ahead of this. Am I getting ahead of myself?
I think it's really important to keep the U.K. numbers in context, and I would point you to the medium-term guidance that we have given for the group. If you look at where we stand on a revenue basis for the end of 2025, you can impute the growth rate required to reach GBP 100 million of revenue by the end of 2029, and you would see that we have considerably been beating that on a historical basis. And so I would focus on the medium-term guidance and will definitely let you know when it's a good time to start extrapolating more of the U.S. numbers.
In the meantime, we'll be reporting on the significant milestones that it takes to build the U.S. business for the long term, which of course includes the completion of a lot of the product work that we did over the course of last year, but also the signing of the Safe Harbor IRA contract that we just announced.
Fantastic. And that concludes the questions. And thank you for answering those from investors. And of course, any further questions come through, the team will be able to review those and we'll publish responses where appropriate to do so on the Investor Meet Company platform. Just before redirecting investors to provide their feedback, which is particularly important to you, Romi, if I could just ask you for a few closing comments, please.
Absolutely. Thanks so much for joining the call today. It's always a pleasure to engage with the investor community. And we look forward to having more conversations as we move into 2026.
Fantastic. Thank you both for updating investors today. Can I please ask investors not to close this session? It should now be automatically redirected to provide your feedback so that all the management can better understand your views and expectations. It only takes a few moments to complete and is greatly valued by the company. On behalf of the management team and PensionBee Group plc, I'd like to thank you for attending today's presentation. That concludes today's session. Good afternoon to you all.