The business to be conducted at the meeting will be to review the audited accounts for the year to 30 June 2013 and to vote on resolutions, including the re-election of directors
As per last year, the AGM will be broadcast as a live webcast, and you are encouraged to submit your vote using this proxy form rather than attend in person (to keep our costs down!). You are welcome to participate in the webcast and ask any questions live to the Chairman i.e. me Although of course you can ask questions at any time during the year using our forum
General guidance with regard to our AGMs can be found here
Below is my "Review of business" which is also included in the accounts:
If you have any questions on the accounts, no need to wait until the AGM - ask away!REVIEW OF BUSINESS
The year under review was the company's third year of operation. We made continuous improvements to our cashback service, with a dual aim of generating the maximum amount of cashback for members whilst also establishing a reputation as the most reliable and trustworthy cashback website. To date, imutual can boast the following achievements:
- We have extended our range of cashback merchants to over 3,000.
- We launched our "mutual dividend" initiative, beating the rates offered by our largest two competitors on over 80% of our merchants.
- We have tracked and awarded cashback to imutual members over two million times.
- We launched a new site design to make imutual more attractive to prospective members and easier to navigate for existing members.
Performance of the business
During the year, our revenues more than doubled from £118,296 to £260,881. This represents a small fraction of the potential revenues the company can achieve in the long term, but at this early stage for imutual we are pleased to see such a significant increase in turnover. It should be noted that this figure included a significant contribution from a small number of deals which we do not expect to see repeated in the following year. That said, the underlying performance of the business is clearly showing an improving trend. We also achieved our first annual profit, a significant milestone in the company's development. Again, it may be difficult to repeat this achievement in the following year, due to limited profit margins and the need to invest in the website's development. Unlike other companies, imutual does not seek to maximise its profits; its primary goal is to deliver the best possible savings for its customers whilst managing its costs prudently and increasing the value of the company.
Our administrative expenses for the year were £65,339. By way of comparison, the equivalent figures for the two largest UK cashback websites are £5.3m (year to July 2012) and £3.6m (year to Jan 2013). We attracted a further 5,077 members to the website during the year. imutual's approach to recruitment has been to rely on word-of-mouth recommendation rather than spend members' funds on advertising. We are continuing to see an increase in favourable commentary of imutual on third party websites and, together with planned improvements to the website and other initiatives such as tell-a-friend incentives, we hope to recruit significantly more members in the year ahead.
We consider that our key financial performance indicators are those that communicate the financial performance and strength of the company as a whole, these being turnover, gross margin and return on capital employed.
The company reported a profit after tax of £1,883. Share capital in issue at the year end was £12,527 and closing reserves were -£16,350. The amount of cash at bank has increased from £7,899 to £32,074. The directors have demonstrated their commitment to the business by giving a written undertaking to provide ongoing financial support for the company.
By way of comparison, below is a comparison of our financial performance over the past few years with the largest two cashback companies.
- For simplicity, "Cashback paid" is assumed to be "Cost of sales" as reported in the accounts, although in reality Cost of Sales could include other items such as refer-a-friend fees.
- "Revenue kept" is the difference between revenue earned by the company and "Cost of sales"
- "Overheads" are the costs of running the company which are not classed as direct "Cost of sales", including administration expenses and exceptional items. It excludes any dividends paid to shareholders
There are only 3 lines for imutual as we only have 3 full years of operation, but the points I hope imutual members will take from this comparison are:
- There are significant revenues being generated in the industry that imutual operates in, demonstrating the huge potential for our company
- Whilst accepting that the top 2 sites do many things we don't, such as mobile phone apps and high street cashback, we're proud that we have kept our overheads so low while providing a broadly-equivalent online cashback service.
- The importance of having a member-owned business model to provide an alternative to commercial sites with outside shareholders. The top 2 describe themselves as "100% cashback sites" (and for years quidco called itself a "co-operative"), and yet over this period there's a difference of nearly £30m between income earned and what's been paid out to members. We think our member shareholder model is a good way of making us accountable to you, so that you can ensure that your cashback site is being operated 100% in your interests
I hope this is of interest