Moonpig Group Stock

Right. Good morning, everyone, and thank you for joining us. This is my first full year results presentation as CEO of Moonpig Group, and we've deliberately chosen to host today's event differently. We wanted to create the opportunity for more direct engagement and conversation with our investors and analysts. Members of my executive leadership team are here today. We operate as one team, and I wanted you to have the opportunity to meet the people responsible for delivering our strategy, serving our customers and building the future of our group.

Before we get into the results themselves, I'd like to share some reflections on my first few months in the role, what attracted me to Moonpig Group and where I see the opportunity ahead. Before I talk about the group, I thought it would be helpful to say a few words about my own background and what attracted me to Moonpig Group. I spent most of my career leading consumer-focused digital businesses. Most recently, I spent 8 years at Auto Trader, where I served as Chief Operating Officer. Prior to that, I held senior leadership roles at Trainline and Addison Lee.

Across those businesses, I've worked at the intersection of data, technology and operations, helping to build stronger customer relationships and to drive sustainable growth. When I was considering my next role, I was looking for a business with strong foundations, a meaningful purpose and significant long-term potential. And I found it at Moonpig Group.

Moonpig Group has strong foundations. It combines trusted brands, deep customer relationships and differentiated capabilities with attractive economics and strong cash generation. Moonpig Group has a meaningful purpose. At its heart, this is a business that helps people connect with the people they care about. Every day, millions of customers trust us with some of life's most important moments from birthdays and anniversaries to celebrations, milestones and moments of support.

In a world of artificial intelligence and algorithms, the human connection that we create here feels more important than ever. That emotional connection is powerful. And crucially, Moonpig Group has significant long-term potential. I've spent time across the group meeting over 500 colleagues, many of our customers, partners and shareholders, and my conviction in that potential has only grown.

One of the most consistent questions I've been asked since joining is whether people should expect a material change in strategy. The answer is no. This is a business with strong foundations, a disciplined growth framework and a clear financial model. We remain committed to delivering sustainable revenue growth, strong cash generation and attractive returns for shareholders. That said, I do believe to deliver the next phase of growth, we need to sharpen our focus and to think differently about how we create value.

It has become increasingly clear to me over the last few months that Moonpig has a unique combination of strengths, trusted brands, deep customer relationships, rich proprietary data and differentiated operational capabilities. These assets provide us with a powerful foundation for future growth. The question is not whether we have the right foundations, we do. The question is whether we are fully realizing the potential of those assets and those capabilities. And my view is that we are not.

Over the last few years, the business has invested significantly in technology, data and customer relationships, building capabilities that are difficult to replicate. The opportunity now is not simply to do more of what we have done before. It is to be deliberate about where we focus, how we create sustainable competitive advantage and what will drive the next phase of growth.

The 3 priorities I'm about to outline are the areas where I believe we can create the greatest long-term value. Firstly, our differentiated model, which is built on customer relationships and operational excellence. Historically, Moonpig Group has often been described as a technology business. Technology remains fundamental to our success and will continue to play an important role in our future.

Much of the discussion around Moonpig has focused specifically on the product features that we have delivered like AI stickers or face swap functionality. Increasingly, I believe these capabilities are the price of entry rather than the source of competitive differentiation. At our core, we help people build and maintain meaningful relationships. We serve deeply human needs, celebrating, supporting, thanking and staying connected with the people who matter the most. Product features enable us to do this through convenience, personalization and increasingly through AI, where it enhances creativity, relevance and the customer experience. But these features alone are not our only competitive advantage.

Our ability to deliver these experiences comes from the combination of trusted customer relationships, proprietary data, operational excellence and the unique capabilities we have built over many years. Together, these assets allow us to understand customers more deeply, personalize experiences more effectively and deliver products both reliably and at scale.

As technology becomes increasingly accessible, individual product features will inevitably become easier to replicate. What is much harder to replicate is the integrated model that sits behind them. Our model gives us the agility and economics of a digital business while retaining control of the customer experience and the ability to innovate our tangible products and services in ways that many pure technology businesses cannot.

We can fulfill and deliver over 750,000 cards a day of any design and almost 100,000 gifts customers can order up until 9:00 the night before for delivery before 1:00 p.m. the next day. Put simply, the moat is not the feature. The moat is our model. And as we look ahead, we believe that model will become an increasingly important source of sustainable competitive advantage and long-term growth.

The second focus area is driving frequency and lifetime value through a deeper understanding of our customers and building more personalized customer relationships. The more time I spend with our customers, the more convinced I become that our greatest opportunities start with understanding them in a more human way, understanding the occasions they celebrate, the people they buy for, the moments that matter most and the barriers that prevent them from engaging with us more often.

While we've traditionally focused on customer cohorts and taken a relatively functional approach to customer understanding, I believe we've underinvested in understanding individual customer needs, motivations and behaviors. We've become very good at understanding what customers do. The opportunity now is to better understand why they do it, complementing our cohort-based view with a much richer understanding of individual customers and the relationships that matter most to them.

For example, our recent research shows there are customers looking for highly personalized cards to give in person, who we do not serve as well as we could today. Equally, there are customers who prioritize speed and convenience above all else. The better we understand these different needs, the more opportunities we can create to serve them.

Over many years, we have built what we believe is the richest customer data set in our category through trusted customer relationships and millions of meaningful interactions. Yet I believe we are still only scratching the surface of what it can enable. Historically, we've used data to optimize channels, improve experiences and drive conversion through recommendations based on aggregated customer behavior. Increasingly, the bigger opportunity is to use it to build more personalized and more valuable customer relationships.

So the opportunity is not simply to understand customers better. It is to help them celebrate more occasions, strengthen the relationships that matter most to them and make gifting more relevant and meaningful through personalization. Whether through improved reminder journeys, more relevant recommendations, and an evolved Plus proposition or the intelligent application of AI, we are still at the beginning of what this opportunity can unlock.

The third area of focus is leveraging our group advantage. Our opportunity is not simply to strengthen the assets of the group individually, but to leverage them more effectively across the group. Historically, we have operated as a collection of businesses. Increasingly, I believe the opportunity is to think and operate as one group so that we can move faster, share capabilities more effectively and unlock more value from the assets we already have. We can apply insights across markets. We can leverage technology, data and operational capabilities across the group. And we can ensure that the strength that exists in one part of the business create value for all parts of the business.

We're already beginning to see this in practice through our Experiences business, which we have brought much closer to the group. I also believe there is an opportunity for us to become more externally connected to spend more time with our customers, to build deeper relationships with suppliers, creators and strategic partners and to strengthen the ecosystem around our brands.

Ultimately, this is about pace, faster learning, faster execution and unlocking more value from the assets we already have. Taken together, these focus areas give me confidence that the group's opportunity remains significant. It is significant because we operate in large and resilient markets. Online penetration remains relatively low compared with many retail categories. Our market shares remain modest relative to the size of the overall opportunity and customer frequency remains below what we believe is achievable. And advances in technology, data and personalization are creating new ways all the time to serve customers and deepen engagement.

As a group, we are committed to building a track record of consistent delivery over the longer term. Our objective is to deliver sustainable, high-quality growth supported by strong returns and disciplined capital allocation. We have a consistent financial framework and are targeting mid- to high single-digit annual revenue growth and an adjusted EBITDA margin of 25% to 27%. We aim to deliver double-digit growth in adjusted earnings per share alongside continued returns of excess capital to shareholders.

Today's results demonstrate the resilience of the business that this team has built. But what excites me most is the opportunity ahead of us, an opportunity to build on strong foundations, an opportunity to unlock more value from the assets we already have and an opportunity to continue delivering returns for shareholders over the very long term. With that, let us turn to the results for the year. Over to Andy.

Thanks, Catherine, and good morning, everyone. We delivered another year of strong financial performance with revenue growth, strong margins and excellent cash generation. Revenue increased by 6.5% to GBP 373 million, driven by continued growth at Moonpig and a return to growth at Greetz. Our business model continues to deliver high margins with adjusted EBITDA increasing by 8.1% to GBP 104.6 million and adjusted EBITDA margin remaining strong at 28%.

Profit growth, together with the benefit of our share buyback programs, drove adjusted basic EPS up by 19.5% to 18p. We also continue to generate significant cash with free cash flow increasing by 11.2% to GBP 73.5 million. These results demonstrate the strength of our model and provide the foundation for continued investment in growth alongside attractive shareholder returns. Let's look at each in turn, starting with revenue growth.

Both of our card-first brands delivered revenue growth in FY '26. Revenue at Moonpig increased by 8.6%, building on the strong growth delivered in FY '25. Performance was supported by new customer acquisition, customers trading up to higher-priced gifts and larger card formats and increased adoption of tracked next-day delivery. We also delivered revenue growth of 33% across Ireland, Australia and the U.S.

Greetz returned to growth with revenue increasing by 4.5% in sterling and 1.5% in local currency. This reflects the progress in strengthening the local proposition, improving online customer experience and deepening customer engagement through initiatives such as Plus and Reminders. We also continue to invest in marketing and commercial partnerships at Greetz, driving strong new customer acquisition and contributing to a gradual strengthening in revenue growth through the year.

Together, Moonpig and Greetz delivered revenue growth of 7.9% in FY '26. Let's look at the customer and order trends behind that growth. Order growth in FY '26 was driven by new customer acquisition. Orders increased by 2.1% to GBP 36 million, driven by continued growth in active customers. Our active customer base increased by 300,000 to 12.3 million, with growth at both Moonpig and Greetz reflecting the strength of our customer acquisition platform.

Purchase frequency was broadly stable, reducing from 2.94 to 2.92 orders per active customer. This reduction was specific to Greetz and reflects increased use of commercial partnerships with nationally recognized Dutch consumer brands as a customer acquisition channel. These partnerships are an effective source of new customers, but they temporarily dilute average order frequency while we build engagement with them.

Importantly, frequency at Moonpig remained unchanged year-on-year despite significant migration to tracked next-day delivery at a higher price point. Turning to average order value. Alongside growth in orders, we also delivered strong growth in average order value, which increased by 5.7% to GBP 9.32 per order, excluding VAT. This growth reflects continued improvement in the customer proposition.

Customers traded up to higher-priced gifting products, including categories such as homeware, where we've added trusted brands. We also saw higher uptake of our large and giant greeting card formats. Gift attach rate increased by 0.2 percentage points to 17.9%, supported by the continued development of our gifting proposition and the addition of new trusted brand partners.

Average order value also benefited from increased uptake of tracked next-day delivery and the impact of stamp price changes. Importantly, there were no significant changes to card pricing during the year with the U.K. standard card price remaining at GBP 3.99 throughout both FY '25 and FY '26. Looking ahead, we remain confident in the long-term opportunity to increase gift attach rates. We're focused on making gifting more visible throughout the customer journey while moving towards truly personalized gifting recommendations for individual customers.

Turning to cards and attached gifting. Moonpig and Greetz both operate a card-first strategy with more than 95% of orders, including a card. Card revenue increased by 9.4% during FY '26. Growth was driven by higher order volumes, increased customer uptake of tracked next-day delivery, stamp price increases and continued success in upselling customers into larger card formats. Attached gifting revenue increased by 6.5%. This was supported by higher card order volumes, a modest increase in gift attach rates and customers trading up to higher-priced gifting products.

We'll look next at Experiences, where we've strengthened the commercial offering and improved performance. We've continued to make progress in strengthening the Experiences proposition during FY '26. Revenue decreased by 4.5% for the full year, but within this, trading improved throughout the year with revenue down 8.9% in the first half and down 1.9% in the second half. This improvement reflects the work undertaken to strengthen and broaden the product range.

During the year, we expanded our range across key categories, including Casual Dining, Days Out, Immersive Experiences and Subscriptions. This all helped to restore growth in gross transaction value. However, the impact on revenue was partially offset by lower average commission rates, reflecting changes in supplier and product mix. Our focus has also broadened beyond the commercial proposition to the recipient experiences.

We've made organizational changes to bring the Experiences business closer to the rest of Moonpig Group and expect alignment to strengthen over time. With this in mind, we're focused on ensuring that product quality and the recipient journey consistently meet the standards expected across the group. While the progress made during the year is encouraging, further work remains. And as a result, we expect the trading pattern seen in the second half of FY '26 to continue in the near term. Growth in gross transaction value is likely to remain offset by lower average commission rates as we continue to prioritize proposition quality and recipient outcomes.

Moving now to gross margin performance across the group. We delivered gross profit growth of 4.5% to GBP 218 million and continue to invest in our delivery proposition. Gross margin at Moonpig decreased by 1.1 percentage points to 55.9%, and that reflects strategic investments to expand delivery choice through tracked and premium options. We also saw a mix impact from revenue growth in new markets where gross margin rates are lower due to outsourced fulfillment.

Gross margin at Greetz increased by 0.6 percentage points, reflecting the transition of Dutch flowers fulfillment to the group's long-term strategic category partner. Looking ahead to FY '27, we expect gross margin rates to reduce modestly, and this reflects continued investment in strengthening our delivery proposition and expanding customer delivery choice alongside the mix impact of continued growth in new markets.

Despite the impact of these investments on gross margin, we increased adjusted EBITDA margin to 28% and delivered adjusted EBITDA growth of 8.1% to GBP 104.6 million. At Moonpig, we maintained a strong adjusted EBITDA margin of 30.5%. The lower gross margin rate was partially offset by positive operating leverage and a lower level of share-based payment expense. At Greetz, the organizational restructuring, which we completed in late FY '25, reduced the indirect cost base and helped drive a 4.4 percentage point increase in adjusted EBITDA margin.

The restructuring also allowed us to strengthen and refresh the team, supporting the return to revenue growth in FY '26. As Experiences continued cost efficiency initiatives drove a 2.3 percentage point improvement in adjusted EBITDA margin, looking ahead to FY '27, we expect adjusted EBITDA margin to ease towards the top of our target range of 25% to 27%, reflecting continued investment in our delivery proposition and a higher rate of share-based payment expense. Strong growth in adjusted EBITDA translated into even stronger growth further down the P&L with adjusted PBT increasing by 13.4% to GBP 76.5 million.

Depreciation and amortization reduced slightly to GBP 17.4 million, reflecting the relatively low level of capital expenditure over the last 3 years. Net finance costs increased by GBP 0.3 million year-on-year with the benefit of lower interest rates more than offset by higher average borrowings. Adjusted basic EPS increased by 19.5% to 18p, which reflects both the growth in profit and the positive impact of our share buyback programs. Over the last 12 months, we repurchased and canceled approximately 28 million shares, reducing issued share capital by over 8%.

Now let's look at how those profits have translated into cash. We consistently generate strong free cash flow. This reflects our high-margin business model, disciplined capital expenditure and the benefits of negative working capital. Free cash flow increased by 11.2% to GBP 73.5 million in FY '26, representing 70% conversion of adjusted EBITDA. Capital expenditure increased by GBP 2.6 million to GBP 15.9 million. Around GBP 0.8 million of this increase related to software development with the balance reflecting planned investment in automation and in-sourcing at our Tamworth fulfillment center.

Working capital was a modest outflow of GBP 0.5 million, whilst taxation increased by GBP 2.2 million, reflecting higher profitability. The group's strong and consistent cash generation supports continued investment in technology, in customer acquisition and in operational automation while also providing substantial capacity for shareholder returns. FY '26 highlights how we have deployed that capacity to return capital to shareholders.

Our approach to capital allocation remains unchanged. With our organic growth priorities fully funded and significant M&A not currently part of our strategy, our focus remains on returning excess capital to shareholders. Importantly, we've delivered these returns while maintaining balance sheet discipline. Net debt to adjusted EBITDA was 1.03x at year-end, in line with our target leverage of around 1x on an IFRS 16 basis.

Turning to dividends. We operate a progressive dividend policy, targeting dividend cover of 3 to 4x over the medium term. The Board has proposed a total dividend of 3.75p per share, which is up 25% year-on-year. Alongside dividends, we're returning significant capital through share buybacks. We repurchased GBP 60 million of shares in FY '26, equivalent to over 8% of opening share capital. And looking forward, we intend to repurchase up to GBP 65 million in FY '27.

As always, we approach buybacks with discipline. We undertake them only where they are EPS accretive, funded from excess capital and offer an attractive rate of return. Now finally, let me update you on current trading and the group's outlook for FY '27. As highlighted in this morning's results announcement, trading across the group since the start of the year has been in line with expectations, and our outlook for FY '27 remains unchanged. We continue to operate with a consistent financial framework, and our goal is to deliver sustainable, high-quality growth supported by strong returns and consistent capital allocation.

We are targeting mid- to high single-digit percentage annual revenue growth and an adjusted EBITDA margin of 25% to 27%. We aim to deliver double-digit percentage growth in adjusted earnings per share alongside continued returns of excess capital to shareholders. And with that, I'll hand over to Catherine to cover the strategic progress we've made during the year.

Thanks, Andy. At the heart of Moonpig Group is a simple, but powerful idea. We use data and technology to turn transactions into long-term customer relationships. Most retailers start each year having to reacquire a large proportion of their customer base. Our model is fundamentally different. Through our capabilities, including over 100 million occasion reminders and over 1 million-plus subscription members, we help customers remember, celebrate and connect through the moments that matter the most.

The result is a business where around 90% of our revenue comes from existing customers. That level of loyalty is unusual. It is one of our greatest competitive advantages and the foundation on which we continue to build. It means we can acquire customers profitably, deepen our relationships over time and create highly relevant opportunities to grow gifting alongside cards. It gives us a more efficient growth model, stronger economics and a richer understanding of the relationships, occasions and motivations that matter to our customers.

As we look ahead, our opportunity is not simply to acquire more customers. It is to strengthen the relationships we already have to increase frequency, improve relevance and play a bigger role in helping customers celebrate, connect and show they care. Our business is built on transactions, but more importantly, it is built on relationships. And the stronger those relationships become, the stronger Moonpig becomes. These are the fundamental drivers of our business, and they will remain our focus for years to come, growing our customer base, deepening engagement, increasing frequency and strengthening the loyalty that underpins our long-term growth.

We see a significant runway for growth ahead, and that opportunity is reflected in the 3 compounding levers that underpin our business model. The first is customer growth. Across our core U.K. and Dutch markets, there are around 51 million card buyers. And today, we serve 12.3 million active customers, having added 300,000 new customers in 2026. That gives us a substantial opportunity to continue to grow our customer base over time.

The second is frequency. Customers in our markets purchased on average around 19 cards a year. Today, our active customers send an average of 3.5 cards annually through Moonpig and Greetz. Whilst we already benefit from high levels of loyalty, there remains a significant opportunity to help customers celebrate more of the occasions that matter. And the third is average order value. More than 60% of occasions involve both a card and a gift. Yet today, our gift attach rate is 17.9%. As we continue to improve our gifting proposition, increase relevance and strengthen the customer experience, there is significant headroom to grow our share of those occasions.

What makes our model particularly powerful is that these levers reinforce one another. As we acquire more customers, deepen engagement and increase frequency, we create more opportunities to grow gifting and increase value per order. Together, these 3 levers create a powerful compounding effect that drives sustainable growth over time. These will remain our most important growth metrics, but our approach to driving them is changing. Historically, much of our focus has been on product features like handwriting and customer-facing innovation like AI stickers.

Those things remain important. But increasingly, we believe the biggest opportunities lie in understanding our customers in a more human way, understanding not just what they do, but why they do it and using the unique data, operational capabilities and customer relationships we have built over many years to serve them better. The metrics themselves do not change. What is changing is our focus on the underlying drivers of those metrics and our belief that there remains a significant opportunity to unlock more value from the foundations that we have already built.

The opportunity to grow frequency starts with helping customers remember and celebrate more occasions. One of the things that makes Moonpig unique is that we're not simply present at the point of purchase. We have the opportunity to support customers throughout the entire relationship life cycle. Over the years, we have built a significant set of customer engagement assets, including more than 100 million stored occasions and a growing subscription base of over 1 million-plus members.

These assets are valuable because they help us stay connected to customers in between transactions. They allow us to engage customers in relevant and helpful ways rather than simply marketing to them when we want them to buy something. Our reminder service is a great example of this. Today, around 40% of orders are placed within 7 days of an occasion reminder. That demonstrates the important role we can play in customers -- in helping customers manage important moments in their lives.

Looking ahead, we believe there is significant opportunity to make these engagement tools even more valuable. We want to create a more personalized, intelligent and helpful experience that understands customers, their relationships and the occasions that matter the most to them. Similarly, we continue to see momentum in Plus. Our subscription base has grown by almost 30% year-on-year and now represents around 1/4 of Moonpig orders.

Beyond the commercial benefits, Plus strengthens customer loyalty, increases engagement and creates a deeper relationship with our most valuable customers. Taken together, these capabilities are not just marketing tools. They are relationship-building tools. They help customers celebrate more occasions, increase engagement over time and ultimately drive greater frequency and lifetime value. Having discussed how we build and maintain customer relationships, the next question is how we continue to improve the customer experience itself.

Every customer journey starts with finding the right card. With more than 40,000 card designs across Moonpig and Greetz, helping customers discover the most relevant product quickly and easily is becoming increasingly important. This is where personalization can play a critical role. We can use data and technology to make the discovery experience more relevant over time, helping customers find the right card for the right person and the right occasion with less effort.

At the same time, we continue to invest in creativity and personalization. Features such as Face Swap give customers more ways to create something unique, while improvements to our local proposition at Greetz ensure we remain relevant to customers in each market. While these innovations may appear small individually, together, they help to create a better customer experience, improve conversion and to strengthen engagement.

Ultimately, our objective is simple: to make it easier for customers to create thoughtful, meaningful products that help them celebrate and connect with the people who matter the most. Once the customer has found the right card, the next opportunity is helping them create an even more meaningful experience through gifting. This is an attractive growth opportunity within our model, and our approach is not simply to offer more products. Instead, our focus is on building a more relevant, curated and trusted gifting proposition that complements the card journey and helps customers find the right gift for the right recipient.

Importantly, we're already seeing evidence that customers are responding positively to a stronger gifting proposition. Attached gifting revenue grew by 6.5% during the year, driven not only by higher order volumes, but also by customers increasingly choosing higher-value gifts. This reinforces our belief that the opportunity in gifting is not only about increasing attachment rates. It is also about helping customers find more meaningful gifts and creating greater value from each occasion.

When we improve relevance and recipient outcomes, customers are willing to spend more with us. Over time, we believe gifting will be an important contributor to growth, allowing us to deepen customer relationships while increasing the value we create from each interaction. Once the customer has selected the right card or gift, the experience moves into an area of the business that we believe is an increasingly important source of both customer value and competitive advantage.

Over many years, we've built highly specialized fulfillment and operational capabilities that enable us to manufacture, personalize and deliver hundreds of thousands of unique products every day with high levels of quality, speed and reliability. These capabilities are fundamental to the customer experience. Customers trust us not only because we help them choose the right product, but because they trust us to deliver accurately, reliably and on time for some of life's most important moments. While individual features can often be replicated, building an operational platform capable of delivering highly personalized products at scale requires years of investment, expertise and continuous improvement.

Importantly, these capabilities do not just improve customer outcomes. They also create meaningful economic advantages. They enable us to improve efficiency, support attractive unit economics, scale profitably as the business grows and continue investing in the customer proposition. As we look ahead, we see opportunities to continue strengthening these capabilities through automation, fulfillment innovation and operational improvements.

Our fulfillment operation is not simply an operational capability. It is an important part of our competitive advantage. Our fulfillment capabilities do more than enable efficient operations. They allow us to continually improve the customer proposition and better support the occasions that matter most. One of the clearest examples of this is the evolution of our delivery offering. Increasingly, customers want greater flexibility, more certainty and more control over how and when their products arrive. This is particularly important in a category where purchases are often linked to specific dates and meaningful occasions.

Over the last few years, we've expanded the range of delivery options available to customers, including faster delivery services and track delivery propositions. The response from customers has been encouraging, where faster and higher value delivery options are available, customers consistently choose them. This reflects the nature of the occasions we serve and the importance customers place on ensuring cards and gifts arrive on time.

Importantly, track delivery does more than create a better customer experience. It provides greater visibility throughout the delivery journey and has contributed to a reduction in customer service contacts relating to delivery issues. Our goal here is to remove friction, provide customers with more choice and increase confidence that they will successfully mark the moments that matter.

Looking ahead, we see further opportunities to strengthen our proposition through additional delivery innovation, greater flexibility and a better recipient experience because ultimately, the value we create is not when a customer places an order. It is when a card or gift arrives at exactly the right moment.

Before I close, I want to acknowledge the progress the team delivered during FY '26. The performance we're reporting today reflects the hard work and commitment of our people and the strength of the business that has been built over many years. As I've settled into the role, what has become clear to me is both the scale of the opportunity ahead and how much potential remains to be unlocked.

The foundations are strong. The strategy remains clear, but I believe the next phase of growth will come from sharpening our focus, a deeper understanding of our customers, stronger relationships, better recipient outcomes and greater leverage of the scale, capabilities and assets we have across the group. Our priority remains sustainable high-quality growth, supported by strong customer outcomes, disciplined execution and long-term value creation. That is why I am excited about the future of Moonpig Group. We're building from a position of strength with strong foundations, clear areas of focus and a significant opportunity ahead of us. Thank you. We'll now move to questions.

[Operator Instructions]

Let me go back a bit. Ross Broadfoot from RBC. I've got a few questions disguised as 3. Could you give me some color on how you expect those 3 revenue KPIs to play out into the midterm? And if all goes to plan, releveraging the why, when do you think we can expect to see a bit of a pickup in frequency?

Sorry, the 3 revenue KPIs, you mean the 3, the customer -- new customer numbers, frequency and then...

Yes.

Yes.

And then number two, could you give any detail on how much of the AOV growth of the 5.7% was driven by stamp price increase and tracked delivery? And then sort of part 2 of that, just on those Moonpig delivery options, where do you see that tracked order percentage now at 44% maturing? Just thinking about that in the context of it as an organic growth driver. And then finally, you mentioned in the statement Australia, the focal international region. Will we see much of a step-up in marketing there? And if not, what's holding you back?

I don't know how many questions there were there, but...

Probably 5.

5. Yes, let's go 5. We will take each one in turn and jump or come back towards at the end if we haven't captured them all. So I'll do the first one, and then I'll hand over to you for the second. In terms of the 3 revenue growth levers, I think we've said pretty consistently that we are -- our strategy is clearly to grow all 3. In any half or year period, you should expect us to be growing at least 1 or 2 of them and that you shouldn't expect to see consistent stable growth in all 3, compounding every half year and every year.

I think we've seen good momentum in new customer numbers over the last year or so, in particular, continuing an incredible track record that the business has of very consistently driving new customers into the group. I hope very much that will continue and certainly will remain a very important focus for us. In terms of AOV, AOV has been one of the bigger stories of this last year or so. We have seen despite some wider concerns about U.K. consumer, we've seen through the occasions and the moments that people are selecting Moonpig for, we've seen really strong and consistent growth there. And we don't see any signs at the moment that, that growth is slowing dramatically.

Clearly, we have a job to do to keep making sure the delivery proposition is right, the gifting proposition is right to keep driving that, but it's certainly been one of our more positive levers and will continue to be a positive lever in the future. Frequency, I think, has forever been the big opportunity for the group and remains the big opportunity for the group.

I think we will be trying some different levers and some different ways of thinking about and addressing frequency, as we talked about in the presentation, and we're hopeful that by segmenting and thinking about our customers differently and the missions that they're on that we will find ways to unlock different segments of the market that historically haven't even had us top of mind or haven't thought about us for particular missions that they're on.

And then the question around AOV. Obviously, it was a strong period for AOV growth, up 5.7%. Within that, broadly half of the increase was down to changes in the postal proposition, probably about 1 percentage point coming from stamp price increases and very roughly sort of 2 percentage points coming through from the increase in track delivery.

I mean standing back, we're on a journey from a world several years ago where we had a relatively straightforward delivery proposition, which served all customers equally well with a single proposition for gifts and a single first-class stamp price for cards. And we're on a journey towards a world where there's a much broader range of delivery options available to our customers, and we build our delivery capabilities as a strategic asset for the business.

In the last year, the growth in track delivery has been an important part of that, and we actually expect that to continue in the year ahead. And we will see -- I expect more than half of our of our card-only orders going through track delivery, including sort of an increase in the proportion of large card dispatches that we've seen in recent months go through track delivery. But there will be further innovation, which will sort of build on top of that. And I think one of the things that we referenced in the presentation was the launch of our next-day premium by 1:00 p.m. delivery, which is seeing good uptake. And that will be a driver of AOV growth as well.

So again, I'd encourage you not to think about sort of the growth of track as being a sort of a one-and-done lever, which then means that we're sort of out of runway. It's a process of evolution with lots of opportunities to drive basket size. And I think across the board, what we're seeing is strong customer propensity in lots of different areas, card size format and track delivery and gifting price points for upsell.

On International, I think the overall approach to International, taking a very disciplined approach to organic growth in those markets is still very much the headline. I think Australia and the reference to Australia in the RNS was we have decided to invest a little bit more in marketing in that market, but I would see it as a continuation and a further incremental step-up with still very much the focus being how do we find the right formula to drive profitable growth that will contribute at a gross margin level to the overall group.

Through the work we have been doing in recent months on Greetz, which I guess is our first international market, I think we are getting clearer understanding of the target -- the right target operating model for our international businesses, where should we be building group centers of excellence, where should we be localizing, customizing, whether it's the proposition or the team or the capabilities that we have. And I think some of the learnings there will very much be looking to take and then apply to Ireland, Australia and some of those other markets. Should we work our way back, if that's okay.

John Stevenson of Peel Hunt. Just a couple of questions. First up, the sort of leveraging group advantage. I think you sort of mentioned there's an element of cost, I guess, an element of revenue from that. How much more cost is the potentially to come out from that? And then secondly, I guess, on the revenue side, what is it that you think that you're going to get by kind of centralizing maybe some of this sort of proposition? Is it more about sort of centralized control in terms of how you think about the data and the opportunity?

And then second question is on the Plus membership. I guess, historically, this has always been the best performing customers. Are you now getting to the stage where you're getting new cohorts that you're able to sort of bring in and drive sort of frequency and performance? Or is it still basically your top tier?

Sure. On Group Advantage, you are right. Some of the process of moving from businesses being run more separately in the group to more centralization has been through building centers of excellence, whether that's in finance or in our products and technology team, there has been some cost benefit to that journey. I think most of that in terms of people costs, certainly, I think we're now predominantly through.

There are still some cost savings coming through in whether it's consolidating CRM platforms or sharing tooling and systems. But I'd say they're not material in the context of the overall group. They're nice to have rather than big levers for future improvement. On the direct revenue outputs, I think most of what we're -- most of the learnings and most of the capabilities that we're sharing across the group are -- should be levers that help us drive speed and execute faster. So whether it's a marketing agency we're working within one part of the group, having some great learnings around demand-based bidding or whether it's some social work with influencers, we've been doing in one market that we can bring and transport over into the U.K. or in a different market.

I think it is about we are getting a common central shared sense of purpose for the group and getting that right mix of doubling down group centers of excellence and capabilities, but then where a division has a particularly strong capability in a field or in a discipline, making sure that we're absolutely getting the best value for that within other parts of the group as well. So I hope it will drive speed, pace and alignment that will, over time, drive performance and better revenue in the business units.

Sorry, just on the...

Yes...

Sorry, the second question just on...

Second one on Plus and Membership, sorry. We've added I think the cohort performance on -- the cohort performance on Plus continues to be strong. If we take a baseline of people that are not on Plus and then look at Plus members, we're continuing to see strong signs of loyalty through those Plus cohorts. I don't think we're seeing anything hugely different in more recent cohorts from the early cohorts, but we're clearly continuing to be able to drive the habit and drive performance of people migrating through to Plus through the growth that we've delivered in the last 12 months.

It's definitely an area where as we think about understanding some of the barriers to people using us and where there might be opportunities, Plus is an obvious area where in the future, we might think about evolving the proposition. Are there other tiers or are there different components that should be built into Plus to really try and drive loyalty, but we're right at the early stages of all of that thinking.

It's Hai from UBS. I have 3 questions, if you don't mind. The first one is just to understand the financial framework on the top line a little bit. So you say mid- to high single-digit growth. In April, stamp increase was around 5% to 6%, I believe, this year. So am I correct in thinking that within that range, you have a set expectations of how much you can drive on your own and then the range varies from stamp increase, also whether it's helpful for you or not, right, so that we know where you could land depending on stamp increases? So that's the first question.

The second one is on frequency. So frequency was down a little bit, and you said that's due to Greetz partnerships building. And you say that's temporary reduction. When you say temporary, do you expect that to continue for FY '27 or just first half of '27? And then finally, on Experiences, when you say second half of '26, trading patterns will continue in the near term. Again, I'm trying to get what near term means. Is this throughout FY '27 as well? Or do you expect it to become kind of flat growth for the year?

Do you want to take the first one?

Yes, absolutely. I'll take the first one. So you're right. Our financial framework specifies revenue growth of mid- to high single digit. And I think the question was around whether or not we should expect that to flex based on stamp price changes. I think that the price of a stamp is just one of the inputs into revenue growth in a given period. And hopefully, by now, we've got a very strong track record of showing that in different periods, we're able to drive revenue growth through pulling on different levers depending upon what we think is most appropriate in the external environment in the year that we operate.

And the way that we think about it internally is that to the extent that there is an increase in the price for stamp, that's a contribution to the overall basket size, which means that perhaps we're moving a little bit less in terms of other parts of the overall proposition where we're moving the price. So as an example, in the context of 2 periods where we've been very focused on driving penetration of track delivery because that's the right thing strategically to move away from first class into a different proposition, we haven't increased the price of a stamp during that period on our standard card size despite the fact that, that actually would be more accretive to margin because it's a higher margin element of the overall basket.

So in periods where stamp prices do rise, there will be a contribution to the overall growth in revenue. But if there is a slowing in the rate of stamp price increases, that's not a limiter on our ability to deliver against the medium-term framework.

On frequency, you asked about Greetz and whether the frequency movement was temporary. The explanation for the Greetz shift in frequency is driven by some partnership activity that we ran during the year. When we run partners with big local brands in the Netherlands, we typically see some of those consumers will come through and will be there for the promotion. And so we don't always get the same lifetime value from those customers as we would get if we'd acquired them through direct brand traffic or through our other marketing channels.

I think our goal clearly within Greetz and our mission is absolutely to keep driving frequency and to get frequency trending more positively. I don't think it's not temporary in the sense that I don't think we're never going to do partnerships again. I think we just need to find the right balance and mix between running partnerships that we know pay back and deliver customer growth in the right way, but also driving underlying customer frequency at the same time.

Yes. And then I think the third question was around Experiences. I mean the first thing is we're very pleased with the trajectory of that business and the fact that it's moved much closer to being flat year-on-year in the second half of the year. Within that, as we called out in the presentation, the actual amount that customers are spending on the Buyagift website, the gross transaction value is in growth. And that, from my perspective, is the lead indicator of the health of the business.

The customers of that brand are willing to spend more on the website when they come to shop with us. We are looking to bring experiences much closer to the rest of the organization. And that's both in terms of organization design and ways of working, but also increasingly bringing it within the overall Moonpig brand architecture.

If you're doing that, what you want to do is make sure that every Buyagift customer recipient has a fantastic experience because it's obviously much more adjacent to the core Moonpig brand. And so we are choosing to invest to make sure that we've got a stronger range of partners, a broader range of brand names within the portfolio where perhaps actually there is a little bit of margin difference versus the average, where there are experiences where it's high margin, but we don't think that the proposition is universally outstanding for the recipient. We'll sort of phase that out or change the proposition.

That's something that we expect to continue throughout FY '27. So I think we've been clear with people that whilst we've seen a strong trajectory in experiences, there'll be a slightly different focus. It will be revenue growth rather than revenue quality throughout the new financial year.

Let's keep going along...

Caroline Gulliver from Equity Development. I think you mentioned in the presentation that one area of growth is delivering personalized cards that people wanted to hand deliver themselves, which I believe you can already do because you can obviously just have it delivered to yourself and then hand deliver it. So my question is, is this just an increase in marketing? Is this just an increase in awareness among existing customers or new customers?

So I think we're right at the beginning of doing the work and spending time with customers and really understanding the missions of -- that really play to our strength and the missions that perhaps customers were choosing to go somewhere else before. There are definitely pockets of customers where we have a product proposition, we have a service that should work really well from them, but yet we're not top of mind. We're not the first place they're going to fulfill or to secure that card or gift for them.

So we're right in the middle of understanding like what would it take? What are the barriers to that customer fulfilling that job with us? And what would they need to believe about our brand or our service or proposition for that to become compelling for them. We do know today that about 40% of our customers get the card sent back to them.

And that is a really big signal of actually the personal element, one of the biggest bits of feedback I've heard from customers when I've been sitting down with them is a lot of people just really love writing still in the card and feel like that is a very personal element of the gesture experience that they want to do themselves. And when you dig into those in-person people that are more likely to give in person often, it's because they want to do their own personalization as well as relying on the digital tools that we have available.

So whether it's the delivery proposition that needs to evolve, whether it's how we show up in our range and how the products are curated or whether it's just us understanding that mission in more detail to make sure that we're really talking to them in that moment, we're just at the beginning of understanding all of those things. But the reassuring thing is from both early research and from the time we're spending with customers, there are opportunities with the range and the product set that we already have. There are elements where, yes, we will need to change some things, but there's still a big core opportunity for us to run out with broadly the proposition that we've got today.

It's Georgina Johanan from JPMorgan. Just 2 quick questions, please. The first one, you've talked about understanding sort of why customers do things rather than how. And I guess just if you could provide some sort of tangible examples of actually how you'll go about that, particularly on like a consistent and ongoing basis rather than just sort of maybe sitting down sort of initially. And then my second question was just on marketing strategy and whether you think that the strategy and the spend is in the right place and at the right levels at the moment or if you have plans to kind of evolve that further?

Sure. So the why for me. So one of the conversations, I think we talked about it in the presentation a bit. A lot of our -- if we start with personalization, what we do today on site and then how the product might evolve. Today, a lot of our recommendations and a lot of what we're servicing people through the journey are just that, they're recommendations based on you've picked a card, you personalized that card, and then we're serving you other cards or other gifts based on what other people looking at that card have done.

So it's very logical. It's based on big data and technology, but ultimately, what everyone else has done, like we're recommending based on what everyone has done. But arguably, that's recommending for everyone, but not actually personalized for anyone because it is just a representation of what the whole of Moonpig has done.

Increasingly, with the first-party customer data that we know and with what we will know about what else you might have done on our platform or experience or other orders you might have placed, part of the journey that we want to go on is moving beyond recommendations towards more personalization, personalized to you, not just personalized to everyone that we've seen on Moonpig. So we think there's definitely an avenue there that we want to explore, and we want to keep developing and evolving.

In terms of the Wise as well, some of it comes back to the last question in that we are -- to really understand the barriers to frequency, we really need to understand like why people are not using us and why in those moments, they're not choosing Moonpig or why they're taking some other actions and steps. And the data that we have on our side about conversion rates or about cohort performance just doesn't give the answer to those questions.

We've got great understanding of what people have done on our site of what they've ordered, of what journeys they've been on. But this -- a lot of this learning is about taking it off Moonpig, off platform and understanding, well, right, actually out in the real world, what are all the other choices that people are making and how might we tap into them a bit more powerfully, which won't just come down to our card range and product features on site. It will come down to the delivery proposition, how fulfillment works. It will come down to the full end-to-end customer experience and rethinking some of how that works.

And then just on marketing strategy.

Marketing. Our CMO, Kristof is here, you can ask him afterwards as well and see if he says the same thing. But we -- I think we are -- we have incredible awareness as a brand. It is one of the absolute foundational strengths of the business. And that awareness gives us all sorts of advantages. We've also got a brilliant app with very high download levels and with brilliant performance and conversion through the journey.

So we have brand assets as a result of our history and our heritage that means that we are in a very strong organic position when it comes to how and where we show up for consumers. I think rightly, we prioritize our marketing spend and have done historically very rationally around new customer acquisition. I don't think we want to lose that focus because it is a core part of our economic engine and how the business model works. But there are definitely opportunities to think more broadly about the brand and some of the more human aspects of the brands and the moments that people are using us for that I don't think we've really lent into as much as we could in the past.

We are a very functional or have been a very functional business operating in a very emotional category. And I think there's opportunities to rethink some of that. That means we show up increasingly a bit differently for consumers. I don't think that's as much around marketing spend levels, just as much about how and where we choose to deploy some of that budget.

Andy Wade from Jefferies. Two quick ones and then a slightly potentially waffly one from me. The first one on -- obviously, you're doing a few partnerships on the gifting side of things. Would that have had any impact on the revenue number? So might GMV have been a bit -- GMV growth have been a bit higher than revenue growth. Just interested on that one.

Second one on gift attach, obviously, a bit slower in the second half. You've done a lot on the gifting proposition on the range. You had a lot of new names. Some really good work has been done there. And yet it's sort of backwards a bit. And I don't know, it doesn't seem to make sense to me. So I'm interested as to why you think that's going backwards or went backwards in the second half, only marginally, but still it's not moving forwards. So a bit of color on that one would be really helpful.

And then the third one, so you've made some really interesting diagnosis of the business and thoughts on where Moonpig is, Catherine. But then on the strategic side, there's a lot of very familiar things in there, Moonpig Plus, reminders, gifting range, delivery, so on and so on. I guess I'm trying to think in concrete terms about how we should be thinking about things that are going to change. And the things I noted down here, personalization clearly seems like a key area, expanding that delivery proposition seems like a key area and making things easier to shop for the customer seems like a key area. But have I hit the right ones there? And if that's not it, are there -- is there more stuff there? So just sort of concrete, what's going to be different, I guess, would be the third question.

Sure. Do you want to take the GMV versus revenue on?

Yes, sure. That's fairly straightforward. The partnerships that we've launched during the financial year just gone have all been on a sort of buying as principle. So we've been purchasing the stock and reselling. So no, there isn't a difference between GMV and reported revenue.

On gift attach, you're right, gift attach in the second half, in particular, has been stubbornly at about the same level despite the work the team have done on range and despite the good growth that we've delivered in the value of the gifts that customers have bought. I think we're in the middle, and I'm still in the middle of 3 months in of diagnosing why and how we should think about that and what some of the answers to driving gift attach might be. I think a bit like the different revenue levers that we've got with gifting, it's probably a bit of a similar story.

Yes, of course, we want to drive attach. But equally, there's revenue growth that we can keep driving through gifting and also gifts per order. And we've made some encouraging changes in the last few months around how we treat multi-gifting proposition to get the delivery proposition right for consumers, then that will be an opportunity for us as well. Gift attach absolutely has to stay as a priority.

I think one of the challenges with gift attach is we're a card-first and card-led proposition. and awareness of our card range is phenomenal. Awareness of our gifting range is okay. It's clearly not as strong as cards, what we're famous for. We are trying to drive gifting through the cross-sell. And we need to get better at improving the curation of the range, the personalization of that range so that we are really hitting the right notes with the gifts that we surface for customers in that moment.

There's probably more work we need to do given that, that cross-sell range is always going to be in a moment in a journey on Moonpig, there probably is more work we need to do as well to make gifting more broadly, more associated with the brand, more visible in other parts of the consumer experience and journey as well.

Could I just check on the earlier part of that answer, you were saying that multi-gifts, so that would potentially not move the gift attach rate, but would benefit the AOV...

Exactly...

Because obviously, they're adding to. Okay, some other layer on...

We've seen some of that in the 6.5-odd percent gifting revenue growth that we've seen this year. Some of that is driven by more people adding 2 gifts rather than 1. So there -- when we talk about gifting internally and when I've been spending time with the team, it's those 3 things that we're talking about that all contribute to gifting in a different way. But yes, absolutely still work to do on attach and figuring out the formula that we now need to land to take attach that has been stubbornly around that 17%, 18% mark for quite a while now. We need to think about what some of the bigger levers that we can do to address that.

Yes. And just going in a little bit more on that. I guess the thought had always been that it was because the range wasn't big enough or broad enough, but it sounds like that wasn't the whole answer, right, that...

Right.

Yes, it's a bit more complex than that.

It's more than that. But I think the interesting thing is -- if we put in the range there, the encouraging thing is that people will trade up. And we've encouraged people to buy things from Moonpig that I think a few years ago, maybe people wouldn't have associated with us as a brand. So we've proven that by growing range, we can drive value of gifting. We now need to figure out what are the moments, what are the occasions, what are the mindsets of those other customers that either have never attached, or have attached once, but haven't come back. But what do we need to do to unlock that opportunity? And some of it might be more gifting value, some of it might be more than one gift. But ultimately, we need to keep focusing on attach.

And some of it might be intractable in the sense that for some people getting and putting the effort into a Moonpig card is partly the gift in itself, right? I mean...

Yes. And I'd say it's interesting. We were debating a lot of people have upgraded to large and giant cards. And in some of those moments, like some of the giant cards, if you spend time, some are incredible, like the effort and the thought that people put into them. If you're spending more on the card and then -- I don't know, are people trading off? I'm not -- I don't think we understand that well enough. But definitely, we've seen people trading up, whether it's card size or gift type has been a theme over the last few months. Your last question was how much is going to be different versus how much is going to be the same and we...

Well, more specifically, what are the themes rather than how much, yes.

Themes. Yes. So I think I would caveat it always. And the reason I deliberately talked about areas of focus themes is because I'm still in month 4. And so the exact like what are we going to go and do? What product should you expect to see in a month or in a couple of months' time? We are absolutely on all of those things, but I don't want to commit to things now that we might end up changing in the coming weeks.

But your direction of thinking about delivery and fulfillment more as how do we increase, improve the choice that we're offering to consumers to make that -- I mean, it's a huge part of our service proposition, right? The thing arriving on time, as I see in the customer complaints that I get is as important as the thing, right, if not more important in many ways.

So thinking about delivery as a core part of our service proposition and a core part of the product that we deliver to customers is definitely a theme. And personalization, yes, it's about our data asset and leveraging that differently. It's also about that customer understanding piece, which I think will mean that we evolve the proposition in different ways because we believe to unlock some of those missions or some of the frequency we're not seeing today, we will need to evolve it. That might come through product features.

It might come through range expansion, not range as in digital range, but it might come through with some other physical aspects of the proposition that we think about -- that we want to think about changing as well. And then, yes, your third theme of customer journeys, UX, how do we think about, how we make the job of creating a card, booking a card, checking out, getting to how do we make all of that easier.

We do see for some customers, they're very much there on an efficiency mission. They're buying an 8th birthday card for their niece and they need it tomorrow and they need it in under a minute and they want the job done. And we need to -- our journey is amazing if you want to add load of stickers, add load of photos, spend time creating a beautiful product. We need it also to be excellent if you've got a minute or 2 and you just -- you need to get the job done. And so all of those things are very much part of the work that we're doing and thinking about at the moment.

And no other specific ones that you'd call out. Those 3 are broadly on them...

I think those themes are good themes.

Matthew McEachran from Singer Capital Markets. A couple of questions and one sort of tied in to what Andy was asking about. I mean the markets obviously had a bit of a hunger for the pace of growth, not just the sustainability of growth. You've laid out some initiatives here, which probably give you quite a nice road map in terms of broadening out and sustaining growth. But I'm assuming that some of the initiatives don't necessarily result in a uniform uplift or, if you like, enhancement to the growth rate across the group.

I was wondering if you could maybe give us a flavor as to where you feel the benefits land most effectively initially, i.e., this year into early next year? Is it Greetz? Or is it International? And I think really aligned to that is, again, tied into Andy, do you think Moonpig's growth rate is a little bit resistant to some of these initiatives just initially if the attach rate doesn't move?

I think we're -- the reason, if I take it back a level, the reason for being really clear on the financial framework and financial model is to just -- is to give clarity with the change of CEO that actually back to Andy's question on what's going to change, what's going to stay the same. I think the financial framework for this business is one of its core strengths, right? The fact that we can -- we've got different business units in the group.

They deliver different performance in different periods, but we are figuring out the formula for each of them that means that hopefully, we can get them all to a point where they're delivering sustainable, consistent, and good quality revenue streams over time. And we are comfortable that within that portfolio of business units and within the capabilities we have in the group, we're comfortable that, that financial framework is the right one and is one that as a team, we are all 100% behind and committed to.

I think there will be a place of growth trade-offs within the different divisions. I think when I think about some of the themes of what's going to feel different, I hope they will -- they clearly play in different segments, but there will be benefits for all of the group, like with the experiences leveraging the group capabilities and advantage. I think we're already seeing benefits in customer service and customer experience from the group leaning into that business for Greetz the work we're doing on the target operating model and how should we really think about what needs to be customized versus what needs to be in a center of excellence within the group.

I think all of that thinking will lay the foundations and the platforms that we need to keep growing the group. But I'm very comfortable with the trade-off between delivering sustainable, consistent revenue growth and returning very strong margins, good cash generation and returning surplus cash to shareholders. I think that's the right model for this group.

Great. One for Andy, just in terms of the capital allocation. And you initially talked about very strong discipline in terms of the buybacks, which I think probably means that as the share price continues well now starts to perform and hit some levels, perhaps there may be scope for a return to maybe some special dividend. Would like if you get to the point where buybacks no longer become enhancing and you start generating that free cash flow and not spending, would you look to use the leverage target of 1x through in-year specials to hit to repeatedly do that or not?

Yes. I mean I think that's a fair question. I mean, obviously, as we set out in the presentation, we do have a clear internal framework. We're not disclosing share prices, but we do require to the extent that we're buying back shares, it's from surplus capital. So it's not money that could be deployed elsewhere within the business. It's EPS accretive. And then on top of that, when you do sort of an ROI calculation, it makes sense and is it just being used to nudge up earnings per share. I don't think we're near that point even with the movement in share price that we've seen this morning.

But you're right, in principle, if it got to a point where it was no longer attractive to buy back shares, then we would look at other uses of capital. I think one of the nice things about the fact that we operate the business with 1x leverage is that gives us a bit more flexibility. So we, in addition, have an opportunity to drive EPS accretion through deleveraging the business. We don't do that at the moment because we think it is comparatively more attractive to repurchase shares. But there is a subset of options that are available to us, which we will adopt depending on whichever we think is best for shareholders.

Adam Tomlinson from Berenberg. You touched on it a little bit there, but just a follow-up on Greetz. So back into growth now, but still that delta in terms of Greetz growth versus Moonpig growth. So I was just wondering, a bit more color maybe on where you think Greetz is perhaps underperforming versus Moonpig, how you get that going? And just your confidence, I suppose, over time in when you give that mid- to high single-digit revenue growth guidance, can both brands be at that level?

Sure. So I think with Greetz, we've seen good momentum over the last few months, and it's been really encouraging to see. What's been particularly encouraging is the growth that we've seen in some of the foundational loyalty levers that have been so important for the U.K. market. So we've seen good growth in Reminders, good growth in Plus. And we've seen a continued, I guess, trend towards more stable, low single-digit revenue growth.

Over the midterm, I think with Greetz, we're very comfortable with the overall group guidance. Of course, we would love to believe that we can keep laying those foundations that we can keep driving the trajectory of that business to be close to the U.K. I think we've still got to prove that we can do that and that we can do that sustainably. And that is our job for the next few months to figure out, there'll be a version of the products, the formula that we're deploying in the U.K. And the great thing about having multiple markets is that we see where we launch features, where we launch products.

We're getting a better understanding of what we can build at a group level and just deploy and launch into a local market versus what needs some more thought or some more customization and tailoring. And we are -- I think what I get really encouragement from is that I feel like we're really figuring out those formulas, and we've got a good team driving Greetz, a good team on the ground that have got momentum. So I'm hopeful that we'll be able to prove out a track record for Greetz as well as a very strong track record we've got in the U.K. business.

We will wrap it up there though. Thank you ever so much for joining us today. The team are here. So any more questions for our team and hunt them down. Thank you all.

Good day, ladies and gentlemen, and welcome to the Moonpig Group FY 2026 Half Year Results Q&A session. [Operator Instructions] I would like to remind all participants that this call is being recorded.

I will now hand over to Nickyl Raithatha, CEO, for his opening remarks.

Hi, everyone. Thank you for joining the Q&A this morning. Hopefully, you have had a chance to look through the announcement and to watch the video on the website. I'll just give a quick intro, and then we will get to Q&A as soon as possible.

Overall, it's been a great period for the group, and we now have strong momentum across the board. The first half of the year saw the core Moonpig brand delivering 9.4% revenue growth, saw Greetz returning to positive growth, and we delivered 13% adjusted EPS as a group. The Moonpig business continues to leverage our outstanding data and technology capabilities to drive top line growth in a challenging consumer environment with both growth in customers and gift attach during the period. It's a direct result of the accelerating growth in our loyalty drivers. Our subscriptions grew over 36% to over 1 million subscribers now. Reminders keep growing over 11% over the year to over 107 million now. And our AI creative features are growing at a rapid pace, over almost 60% year-on-year, and now over half of our cards include a creative feature.

Greetz has now successfully returned to growth. We delivered a 1.3% increase in constant currency over the period. And this is due to us fully embedding the benefits of the global technology platform to our Dutch business. And Greetz exited the half at a higher growth rate than the average of the first half, and we will see a sequential step-up in the second half.

The transformation at our Experiences business is now nearly complete, with the tech platform, the team and the product range all rebuilt. And though this did not impact the first half results, we are very encouraged by the step-up in trading momentum that we've seen since the start of the second half, which is particularly crucial given that almost half of the year's trading is captured through November and December alone. We completed the first half of our GBP 60 million share buyback, and we've increased our interim dividend by 25%, underscoring our commitment to significant capital returns.

On a personal note, this is my last, final -- this is and final results presentation. And I wanted to take the opportunity to thank, firstly, the extraordinary employees of the Moonpig Group that have supported me on this incredible journey over the last 7 years as CEO. And also to thank everyone on this call, investors and analysts for all of your support over the last few years. My successor, Catherine, will be joining the business at the beginning of March. And she's going to be inheriting a fantastic business with great trading momentum, a super leadership team led by Andy, who you know well, and a vast long-term growth opportunity that we are really well placed to capture.

Thank you very much, and I will turn over to questions.

[Operator Instructions] The first question is from Ross Broadfoot at RBC Capital Markets.

Three from me, please. Number one, could you give any color on how the Moonpig brand has started H2? You obviously gave a little bit of color for Experiences. Number two, just on the KPI mix. You've obviously had a bigger contribution from AOV, some contribution from new customers and relatively flat order frequency. So question 2a, would you expect similar drivers of growth in H2? And do you have any early indicators that frequency may pick up? And then number three, regarding the better performance that you flagged at Experiences in November and early December, can you give any color on what you think is moving the needle there from the customer's perspective?

Sure. Andy, do you want to take the first two, and I'll take the rest of them?

Yes. So on the first one was around the trajectory of Moonpig for the start of the second half. And actually, we've seen sort of trading consistent with the rate at which we sort of exited the business. So we would, based on current trading, expect the business to continue delivering growth at sort of a high single-digit rate, and sort of close to the sort of 10% mark.

The second question was around the KPI mix. And you're right, the primary driver of revenue growth at Moonpig in the first half was average order value with the contribution as well from growth in new customers. And we were pleased with sort of strong continued delivery of new customer acquisition throughout the first half. I think the point I'd make would be that we don't look to see each of our KPI drivers move in lockstep in each financial period. And we view each of those drivers as a portfolio that we can pull on in order to deliver revenue growth in each period. And for instance, if we look last year, we saw particularly strong new customer acquisition. In the first half of this year, there's been a stronger sort of AOV growth.

And specifically on frequency, that was flat year-on-year. But in the context of a tougher consumer environment and the fact that we have seen some increase in average selling price from moving people on to track delivery, which is a more expensive product, but also a sort of better solution for customer and a better quality product. I think we're actually pretty comfortable with the fact that frequency has been flat. We think that's a solid place to be.

Looking at where we are in current trading, I would expect the drivers of frequency in the second half to be similar. So on AOV, we're continuing to see strong progress in terms of driving gift attach rate. I'd expect H2 to be another period where we drive gift attach. We're making great progress in terms of the rollout of trusted brands, and we've got a number of brands such as Lush and some of the Boots Beauty brands that we expect to launch in the second half, which will continue to drive gift attach.

And then if you think about sort of the increase in track delivery, that really started from the end of FY '25. So we've got a sort of a tailwind in terms of that for the majority of H2. So we'd expect the drivers of Moonpig growth to remain broadly consistent H1 versus H2.

Thanks, Andy. Yes. And on Experiences, I think the -- we've kind of talked in the past about how we've had this three-phase transformation plan. So we've rebuilt the technology platform. That on its own doesn't do anything. What it does is it allows us to then optimize and improve the experience at a much faster pace. And that's something we've been working on delivering huge volume of experiments, which have improved conversion rate consistently.

The team, we kind of finished the rebuild of the team. So kind of the leadership team is now complete. We've kind of improved the capabilities, in particular, on sort of the buying and sort of commercial side of the business. And actually, all of that work has been really targeted around how do we then take that -- take those capabilities and prepare the business for the peak period, which really is the key period in the year.

And so actually, a lot of the products we've launched in the last few months have just been about building those supplier relationships, getting products live, but the real focus is actually on getting exclusive products for the peak period, exclusive supplier-funded discounts, exclusive ranges and just setting everything up so that kind of once we hit the ground in the key trading period that we're actually really well placed. And we saw a sort of pretty kind of clear step change once we launch that peak kind of trading offering. So both from a product perspective, from the way we are doing promotions, from the CRM plan and from our kind of marketing plan as well, where we've kind of saved a lot of our marketing efforts for this period.

And so actually, I think from our side, what we're seeing is we've just got better capabilities to trade. But primarily, we've also got better products to trade as well. And so I think maybe to give you one bit of a color on this, it's not just about new suppliers. So when we have launched some really exciting new partners and those -- the ones that are driving value are the -- and driving excitement are the sort of the exclusive and the very topical ones. So the traders experience is we have exclusivity on that. That drives a lot of interest, a lot of engagement.

Clarkson's Farm similarly. We've also got kind of more products that are sort of more utility-type products, so something like a Spotify subscription where people feel if they don't want to do something that's onetime and it's got a longer use, they're using that. But actually, what we've done is we've gone to some of our older suppliers that we've been working with for years. And we said rather than selling the same products again, how can we package these up and kind of refresh these to make them to look more interesting or to sort of make them more modern and kind of reexcite the customer. And so we've seen like pretty good success in taking some of our old suppliers, spas or restaurants and just creating new menus, new packages, new combinations of products, and that's driving value as well.

So I think it's just -- it's a kind of -- it's a new way of working that we're really working closely with suppliers. They're funding exclusive, they're funding discounts, and we've just got a more compelling range. And I think that gives us confidence that actually the step change we've seen in the last couple of months will kind of continue through into the future.

The next question is from Georgina Johanan at JPMorgan.

Can you hear me?

Yes. Hi, Georgi.

Yes, I just wanted to ask a question on CapEx, actually. Your guidance is really clear. I just wanted to understand kind of on a midterm perspective, how we should expect the CapEx to be spent because it feels like you've invested well over the last sort of 12 months and currently. So what kind of investments are going to be made from a CapEx perspective? And how should they be supporting growth over a midterm perspective, please?

Yes, sure I'll pick up that. Georgi, I think we would expect CapEx to continue within the sort of 4% to 5% of revenue range over time. So steadily growing broadly in line with revenue. There was a slightly different mix to capital expenditure in sort of the first half of this year because I think generally, we expect relatively low tangible capital expenditure, because the nature of our operations is relatively asset-light, but we have seen opportunities for automation in our fulfillment center. And we call out in the announcement two particular projects that we've implemented in H1, which went live in November, which are -- we've in-sourced the production of giant cards. So our largest size format was previously outsourced, but now we're doing it ourselves. And we've implemented parcel sortation, which allows us to effectively sort of dispatch packages by different sort of career services at different rates.

And so there's a sort of a good ROI on each of those in terms of effectively sort of closing the year-on-year margin gap in Moonpig from H2. The majority of our CapEx will continue to be spent on technology development. So we obviously have around about 250 software engineers and product people and data scientists within the organization. And as we talked about when we did the Capital Markets Day just over 12 months ago, we see that as a driver of revenue growth. It's people who are incrementally were working on building out the tech platform, conducting UX experiments. And every time we deploy some of the winning variant, that makes a contribution to one of the drivers behind our sort of revenue growth at Moonpig and Greetz.

And so broadly looking forward, I would expect the envelope of CapEx to be broadly similar. Tactically where there are opportunities to invest for efficiency in fulfillment, we'll do that, but it won't be the bulk. And the majority of our investment will be in tech. And obviously, to the extent that's people internally and capitalized time, just to the extent that the salary rate increases, that will contribute to CapEx growth. But also as we see opportunities to invest, we'll look to do that as well.

The next question is from Adam Tomlinson at Berenberg.

Can you hear me okay?

Yes. Hi, Adam.

So the first question is, I suppose, just on guidance. So with your EPS growth coming in, in H1, I think, about 13%, still guiding to that 8% to 12% for the full year, obviously, implies a bit of a step back in H2. But to your mind, is there anything -- any reason -- I get it's still peak trading to come, but is there anything we need to be thinking about in H2, headwinds or comps or anything like that as to why we should see that -- necessarily see that slowdown is the first question.

Second question is just a current trading question, really. We've had I suppose some of the retail sales data out there was a bit slower heading into the budget. Just wondering, it doesn't feel like you have, but if you saw any kind of slowdown or consumer caution on that front, and was there much volatility in terms of trading. And then third question was just actually on the subscription customers. So obviously, that number going up nicely and now about 20% of sales. And just a reminder, if you could, please, just in terms of the characteristics of your subscription customers and some of the stats around those would be great.

Do you want to take the EPS question?

Yes, sure. Will do. Yes, I mean, you're right. We're really pleased with the fact that the H1 results had EPS growth 13% ahead of our sort of outlook for the full year of 8% to 12%, reflecting obviously both the sort of strong result in terms of profit for the first half, but also the way that we're putting our free cash flow to work through share buybacks and the GBP 30 million that we bought back in the first half, which Nickyl talked about. And I think our stance on guidance is very much informed by the point that you made, Adam, which is obviously, we're coming into our peak trading period. We still got Valentine's Day and U.K. Mother's Day ahead of us. So I don't think we're seeing any particular headwind or reversal that we've factored in for the second half. But we think at this stage of the year, with two of our major peaks still to come, the right stance is to hold our guidance in its current place.

Yes. And I think on kind of the consumer impact of the budget, I think we were reading the same news articles as you, but we didn't see it in our business. I think one of the things about the Moonpig business is that it kind of -- it does have this kind of pretty extraordinary resilience. And because the business is driven so much by existing customers, by reminders, by our CRM that actually it's kind of -- it was able to sort of continue through November, December. We didn't see any sort of volatility there, similarly in -- obviously, in Greece given there was no budget.

But actually, on the Experiences side, I think the sort of the -- this was the move into sort of the peak season. But I think in particular, the change in kind of our transformation plan probably kind of outweighed any macro effects. And so that's why we saw the step-up. So yes, I think our business didn't see any direct read from the sort of consumer uncertainty.

On Moonpig Plus, yes, as you mentioned, we're really thrilled with how this is going. It's kind of 2.5 years since launch now. And like we're continually surprised by just how well it's going, both in terms of how many customers are signing up, the type of customers that are signing up, the change in their behavior and the number of them renewing. And kind of if you put all of those things together, those are the four ingredients for a pretty great subscription service. We've talked about in the past how the average customer is someone who is buying kind of sort of high single-digit kind of number of cards a year. And their frequency once they sign up goes -- is up by about 25%.

So a subscriber once they subscribe, they do buy more cards. And actually, what we've also seen is customers that become members, their attach rate also goes up by kind of a 1 percentage point or so. So we're seeing customers that sign up, they're buying more cards and they're adding slightly more gifts to those cards, which is obviously great. That's obviously in exchange for the discount they get. What's really encouraging is we're seeing very strong renewal numbers sort of, I think, in sort of year 1 to year 2, kind of in the sort of 2/3. Actually higher than 2/3 of customers are renewing, which we know is kind of best-in-class for a sort of membership scheme. And actually, that's kind of -- as we've kind of got the first cohorts kind of moving from year 2 to year 3, we're seeing equally encouraging numbers in terms of the customers that are kind of staying with us into that year. And obviously, the subscription fee is not discounted as you kind of move into year 2 and year 3. So you're paying the full GBP 10 subscription fee, which makes the scheme even more profitable.

So from our perspective, we're kind of -- we've got 1 million very high-value customers that are kind of more locked in and embedded into the ecosystem than ever before. And actually, we're just seeing sort of the snowball effect of the more behavior. Those are the customers that use our new AI features earlier, which drives even more frequency. And so we've really got this kind of virtuous cycle going. And so the focus is very much on how can we move more customers into it. Just probably to give you some color, Greetz is kind of further behind on the Plus journey. So Greetz Plus is live, but it's following a very similar pattern sort of 18 months behind the U.K. And so I think we're kind of excited for, again, what that can bring to the Netherlands as well.

The next question is from Andrew Wade at Jefferies.

Fairwell to Nickyl, I suppose. Good luck in your next role. On to my questions. I've got three of them. First one on the gift side of things. Obviously, the easy answer to this is a bit of everything, but anything in particular you think that's moved that from being relatively flat over a number of years to sort of moving into quite a decent step forward? So that's the first one. Anything in particular in there? Or is it just a bit of everything?

The second one, EBITDA margin impact of gifts. Historically, you've sort of talked to it not being a drag on EBITDA margin. Being a drag at gross margin, but not EBITDA margin. But in your commentary, you sort of talked to adjusted EBITDA margin being down 110 basis points, reflecting the sort of gift impact on gross margin. So sort of interested as to how we see that one going forward now.

And then the third one, track delivery, obviously, been a big boon to revenue this year. Just sort of interested as to whether you're anticipating a sort of step down in top line growth in Moonpig once we annualize that track delivery step forward, i.e., at the start of next year or if you're going to have other dynamics that you expect to sort of pick up the slack?

Yes. Look, I'll take the first and then Andy can take the gift margin and kind of next year's revenue comments. So I think one of the -- you're right, the gift attach didn't move for a few years. I think we were sort of -- we were saying at the time on an underlying basis, we could see how we were driving increases in attach rate. So AB tests when we were launching UX changes, algorithm upgrades, but those were being offset by macro headwinds. So kind of as we entered the cost of living challenges and so on in sort of '22, '23.

What we see now is actually -- I think no one think -- everyone is aware, it's not a particularly favorable consumer environment. But we think from our perspective, it is a relatively stable consumer environment. And so actually, the sort of the year-on-year, there is no macro headwind when you sort of -- when you're annualizing the previous year. And so actually, what we're seeing is probably a continuation of the sort of the organic improvements we were making just that they're no longer being offset by kind of macro headwinds. Those changes are very much linked to the momentum we've got in gifting brands. I think Andy just touched on this, but the sort of the brands that we're bringing on board, they're bigger and better, and we're able to execute them much better than before. So rather than just putting them on site, it's now a true partnership.

If you look at kind of what we've done with NEXT, we're the only third-party reseller of NEXT products in the world, right? NEXT has never in its history, worked with anyone else to sell their own branded products. Not only are they working with Moonpig, but we launched a small range last Christmas. We grew it over Valentine's, over spring, over Mother's Day, Father's Day. And now we've expanded it into more categories. So it's kind of a much bigger range. It's performing exceptionally well. We've launched NEXT Flowers. And so just our ability to work with these gifting partners has really improved, and that kind of obviously then provides case studies for more of them to come on board.

And so I think our gifting team has never been this busy, but it's also -- it's easier than it's been for them to actually convince the next partner to work on board because we kind of -- we're a more attractive proposition. We can demonstrate to pretty much any partner that we are an incremental channel for sales that doesn't compete with their own, and we're able to present their brand in a really positive light because it's a gifting business. So I think lots happening there on the range.

Then on the data science side, there is loss because we've got a 5- or 10-year road map ahead of us in terms of just making those cross-sell recommendations more relevant month after month after month. And we see -- we're consistently doing that. We eke out a few basis points of attach rate every time. And I think with the new AI technologies that are kind of out there, those will continue to deliver for years to come.

Andy, do you want to take the margin?

Yes, sure. Will do. I think the commentary in the RNS was intended to be an explanation of the movement in gross margin rather than EBITDA margin, but it's a useful opportunity sort of just to reiterate in our business model, every time we sell an additional gift, it's incremental absolute margin. We're not paying marketing money for gift sales because every time we sell a gift, it's on a cross-sell for somebody who's come to the business to buy a card. And the gross margin is net of all fulfillment costs, which means that actually there's hardly anything in the cost base, which is variable beneath gross profit for that incremental gift, just a little bit of card acquirer fees, but nothing much else.

And so actually, it remains the case that incremental gifting sales are not dilutive to adjusted EBITDA margin. Or otherwise stated, our gross margin on gifts and fully loaded is higher than our EBITDA margin rate. And so what you're seeing in the EBITDA margin in the first half is the sort of the benefit of operating leverage come through. It does mean obviously that there is a headline reduction in the sort of the gross margin percentage rate and down to mix, but that isn't impacting us further down the P&L.

The third question was on track delivery. And probably just a reminder, track delivery is a fantastic product. The reason we originally introduced it was not as a revenue driver, but to solve for the customer. It's unique. Nobody else in the market does it. It's a great price point. So GBP 2.79 for guaranteed next-day delivery. Nobody else in the market offers it. And we see it really positive for consumer Net Promoter Score. We originally introduced it just over a year ago for peak periods only. But at the end of FY '25, started to scale that as an everyday proposition, and it's up to about 40% of card-only orders at the moment are through our Moonpig guarantee delivery service.

To the point about what happens when the current penetration of track delivery rolls off, I think the answer is that actually we don't think that the current 4 in 10 is the sort of the limit of what we will do on track delivery. And I think there's opportunity in future periods for that to scale further. And in particular, at the moment, we have some commitments around the amount of first class volume that we put through the network. And as they roll off, there's actually sort of further opportunity to scale that product, and we think probably actually ways that we can drive sort of further demand. So I don't see it as being something that we will necessarily annualize when we get to the end of the year.

More broadly, I would go back to the comments around the portfolio of levers that we have. And hopefully, investors will see that actually over the past 4, 5 halves, what we've done is effectively use the sort of portfolio of levers that are available to us to drive growth. In some periods, it's particularly strong customer acquisition. That was the case last year when we had a particularly strong focus in our road map on things that reduce purchase friction and improve new customer acquisition. In other periods, it might be other levers. But no reason to think that we should see a step back in performance as a consequence.

The next question is from Jonathan Pritchard at Peel Hunt.

A slightly different angle here. Just talk to us a bit about Catherine. I don't know, Nickyl or Andy, whether it's appropriate for you to talk about her strengths and sort of how she won the interview process. And then Nickyl, as you leave and very best wishes for what you do in the future, what's the biggest challenge you think that Catherine faces?

Yes. Good questions. I'm not sure, I guess, how well placed we are. I mean the Board obviously led the hire of Catherine, as I think is the appropriate process in this. So that's very much something that maybe the Chair, if you can speak to her, he is probably in best place to answer. Myself and Andy have obviously spent time with Catherine kind of talking about the business, and she's kind of said hello to the team. From my perspective, she seems like a fantastic person candidate, an experienced background mindset to sort of take this business on to great things. So I'm very excited for the change and very happy I'm handing to her, but I probably can't share more than that with a qualified view.

I think the -- I mean, the biggest challenge for Catherine, I think it's actually going to be -- I'd probably reframe it. I think it's the biggest opportunity. I think what she's -- Catherine is coming into a business which has great trading momentum and a really strong leadership team kind of driving that. And so actually, I think one of the things we look at in the business is we need to make sure we maintain that momentum on the Moonpig side and work out how can we continue to capture that opportunity, make sure that sort of the turnaround of Greetz and then Experiences kind of continue their trajectory. And so I think the strategy is very clear there and actually continuing that is going to be really important.

But beyond that, I think the interesting is sort of the smaller sort of seeds that we've planted. So the new markets business, our international business is very nascent, but growing really well. Moonpig for Business is even more nascent. It's launched just in the last 2, 3 months. We've kind of really started to sort of see that scale quite nicely.

And so kind of I think the challenge will be how to sort of invest for the future in kind of new things alongside maintaining that momentum in the core business. But this is a business which is kind of showing pretty strong stability, sustainable growth and an ability to sort of generate those high margins, deliver cash, deliver growth. And so hopefully, Catherine comes into a stable platform and our focus can be very much on how to build on top of that.

The next question is from Hai Huynh at UBS.

And you alluded to this just now in your answer. I just wanted to ask on the contribution of Moonpig for Business at the moment in terms of revenue and profitability. Anything you can say there, a bit more color?

Yes, sure. Look, so it's very small. It's very small at this point. We really -- we kind of -- we were in testing phase for quite some time. We sort of -- I think September is kind of when we sort of -- did a sort of soft launch, and this was mostly sort of through organic LinkedIn posts and referrals. But what we've seen is kind of over the last 10, 12 weeks, we've seen really kind of exciting week-on-week growth. So very much kind of -- we think of this as a sort of small start-up in the company, but we've seen week-on-week growth. We've seen November was more than double October, first week of December was bigger than the whole of November. So we're kind of seeing some pretty exciting growth numbers on a very, very small base.

What's been really interesting here is we've built a product that works great for multiple use cases in an enormous market. And so I think whilst the revenues and P&L are very small at this point, the potential of what this business could be is obviously huge given the size of the market within the U.K. but also globally. And we're catering to sort of two primary use cases. So one is for employers, gifting to employees. And so we're seeing Thank You cards, New Starter cards, Well Done on 5 years at UBS cards, Going Out or Thank You for a Great Year. So that's a really interesting use case to drive employee engagement, and that is -- that's probably about half of the orders we're seeing.

Again, these are driving -- think about the average order size of this business, cards is 50, 100, 150 cards per order. So significantly different to our consumer business so far. And then we're also seeing it used for corporate gifting as well. So we added gifts to the product just, I think, beginning of November, so very recently. And we're seeing people gifting a bottle of champagne to thank you for the end of the year to the 20 clients to 100 clients. And so we've got lots of interest. We've got a very, very small team working on this. It's kind of a couple of individuals, but lots of inbound coming in, lots of momentum building.

And so I think if we can find product market fit, then we will look to scale this. And again, that's something that Catherine and Andy will be kind of making decisions on. But I think there's -- it's a big market, and we're seeing lots of encouraging signs that this could be a really good fit for the business.

Sure. Just two other quick questions, if you don't mind. The first one is just to understand the longer-term economics a little bit. Because you're guiding for 25% to 27% EBITDA margins, and part of that is because of increasing gift attach rate. What are the sort of gift attach rate you're targeting in that midterm range that gives you that 25% to 27% guidance?

Yes. I'll pick that one up. So if you think about our business model with a sort of relatively large fixed element to cost base beneath gross profit, there's a large element of operating leverage inherent in our operating model. And I think all things being equal, what you would expect is that the EBITDA margin rate percentage would increase over time. Our guidance is and has been since IPO for a flat percentage. And I think the important thing is that, that's a choice. So it's us saying that what we want to do is have the opportunity to invest the surplus that would otherwise accrue into opportunities for growth within the business.

And probably the most obvious example of that at the moment is the expansion that we're doing in new markets. So the way that we operate Ireland, Australia and the U.S. together is as a profit pool where to the extent that we drive additional gross profit in those markets, we reinvest all of that into marketing to fund the growth in those markets. And what that means is that to the extent that we drive an extra GBP 1 million of revenue in those new markets, that's effectively at 0 EBITDA. So that's an example of us reinvesting the surplus that would otherwise accrue into sort of revenue expansion within the business.

Now clearly, we've got choice in that going forward. But our guidance as it stands is that EBITDA margin will stay constant, and that's because we think that there are lots of opportunities to continue investing to drive top line growth.

And my last question is just on the competitive landscape. So we're aware of a merger of a key competitor. But do you see -- they're in the transition period, but do you see a longer-term threat there in terms of the competitive landscape? Or do you think the market is large enough for you to grow as you're targeting without being affected?

I think what we've shown over the last several years is that actually we've been able to grow our market share because of the investments we've made in technology and the sort of the virtuous flywheel that it creates in terms of the fact that we are 4 or 5x larger than the next player in both the U.K. and the Netherlands means we have significantly more sort of firepower when it comes to marketing. We have significantly more data, significantly more investments in technology. And then when you sort of combine those things together, that allows us to sort of pull away from the competition in terms of the experience and then the loyalty drivers and the sort of data moat that we're able to create. So we kind of think that, that will continue going forward. We haven't seen any change in competitive dynamics or competitive behavior over the last period. And actually, we're not really anticipating it based on anything we've heard or read publicly.

And I think maybe the other sort of change that's probably more -- that we're more focused on is whether there's a sort of change in the marketing landscape, the growth in LLMs, all of that stuff. And that we're very focused on making sure that if those trends do emerge, we will be very well placed to sort of actually continue our kind of market leadership and extend our market leadership through being the most prominent, whether that's on LLMs or new emerging channels and in other ways because I think we've got the sort of the technology mindset and capabilities to sort of make sure we are all over and kind of at the forefront of any innovations that can come.

The next question is from Matthew McEachran at Singer Capital.

A couple of questions left over for me, if that's okay. And one just comes back to this query about Moonpig operating leverage and EBITDA margin. Let's go back to your point, Andy, about new markets where you're going to be reinvesting the gains. I mean you're annualizing at what, I don't know, GBP 15 million of sales, roughly 4% of group sales. Could you give us some idea as to the scale or critical mass in that side of the business where we should expect some contribution to drop through to profit? I mean is it plausible that, that doesn't start happening until you reach 10% of sales, in which case that is quite a bit of dilution against the accrued benefits through the core business?

I think the honest answer is we don't have a sort of fixed target for the scale of those businesses. We just think that there's significant opportunity that we want to sort of leverage going forward. I think we think about it more in terms of actually outside of Ireland, where we're already profitable, how do we get to a point where we're confident that we can scale investment on attractive economics. So I think we talked in the past about the fact that actually, if you look at Australia and the U.S., the thing that we're solving for is the fact that at the moment, our cost of new customer acquisition is higher than we'd want it to be because people don't know the Moonpig brand in those territories. And therefore, we're working to find out better ways to acquire customers and paybacks that are getting closer to where we are in the U.K. And we don't have the same lifetime value as we do in the U.K., probably primarily because the gifting range is less mature. So our ability to monetize the customers over time is a bit less because the attach rate is lower.

And so the way we think about that and the work that we're doing is to sort of bring down the cost of customer acquisition over time and to raise the lifetime value of customers by progressively improving the gifting range in each of those markets. And we're really looking for the point where we're confident that if we increase our investment in those markets and probably Australia is the sort of the furthest along in terms of being close to a point where we're able to look at that decision. Where we're confident that if we invest in additional marketing, the payback is there because we know the way that the customer cohorts will behave and it presents us with a sort of sensible return on investment.

When we get to that point, it may be that we sort of come back and say we are going to scale and that actually one of the sort of primary uses of that excess in EBITDA margin will be to increase our presence in one of those other markets. But I think we're not there in terms of that yet because it really is dependent upon what we see in the results on the ground.

Yes. That's helpful. Second question, Nickyl, just in relation to experiences. In your video, you talked about the pace of development and new initiatives never having been quicker. And you did talk quite a bit about new suppliers and brand propositions coming through, some of which are -- they're supporting in terms of promotional activity. Could you give us a flavor -- sorry, I'll get to the point. Could you give us a flavor as to what's in the pipeline between now and the key upcoming events around Christmas? Is there still a lot to come? Or have you landed most of what needs to be landed and now it's just a case of getting some yield out of it?

Yes. I mean, look, I think there's a sort of -- there's a very clear Christmas plan, which started really on -- started at the beginning of November. A lot of those key offers and products and exclusives were launched over the Black Friday weekend. And then kind of as we sort of ramp up over the next couple of weeks, I think every day, there are sort of different products that will be featured in different kind of exclusive offers. And then kind of in those final couple of days, I think we've said many times, Christmas Eve is the biggest day of the year for the Experiences business. And so Christmas Morning is also one of the top 5 days. So there are many people that leave it very, very late. And so I think on those, we also want to have sort of special products ready.

So I don't think we can give color on specific SKUs. I think just there's a daily newsletter and a daily website which we're featuring. But I think it's -- a lot of it will be the key suppliers that we have kind of on the website, but that there's special products from within those. So that might be, I think Marco Pierre White, there's a sort of six course tasting menu for a pretty extraordinary price. We've kind of launched that. It's been kind of on and off the website at various points, and I'm sure that, that will come back in the next couple of weeks. That drives huge volume.

We just launched codes [indiscernible] which is kind of something we've been working on for a while, and that's gone live, I think, a couple of days ago. So there are new products coming live, but I think primarily, it's about tweaking the offering and the specific products within those and the sort of the promotional campaign that we'll do around that. So yes, I think I'd probably say the next 2 weeks are kind of more of the same of the last 2 weeks in terms of just the way we're executing it.

The next question is from Anubhav Malhotra at Panmure Liberum.

I've got three on the Experiences business really. Firstly, can you talk about -- in the Experiences business, you said you have secured some supplier discounts for peak trading. But have you been investing more in the gross margin yourself in the second half to drive some of the revenue progress? And then maybe talk about the operating leverage in the Experiences business, in particular, as the performance improves. I mean, you mentioned you're spending more on advertising in the second half. You kept the firepower. But any other operating costs that necessarily increase with growing revenue or improving revenue in that business? And then just lastly, this competition seems to have launched a loyalty program of their own in the Experiences business, your key competitor there. Is that something that you have considered? And I know you used the Moonpig branding already on the Buyagift website. So could that eventually be part of the same envelope of Plus program in your thinking?

Sure. Why don't I'll take the loyalty one, and I'll pass to Andy to talk about the margin questions and the leverage? So I think we haven't considered launching a loyalty program in the Experiences business directly. I think what we see in -- if we think about the difference between the two platforms, the Moonpig business has an average frequency of 3, but the average member who's signing up to this has a frequency in the sort of high single digits. So buying seven, eight, nine cards a year before they sign up, which is kind of, I think, kind of -- it makes sense to sort of be a reward member when you have a frequency that's slightly higher.

In the Experiences business, that number is closer to 1. And so it's above 1, but it's quite low. And so we haven't seen a priority to launch a loyalty product for a business that tends to have a lower frequency. It doesn't rule it out in the future. I think we'll stay close. But for now, our focus has really just been on operational excellence and just making sure we've got amazing products, and we're turning over that product, and we're driving kind of excitement for the customer, and we're making it easier for them to find. This kind of e-commerce basics and kind of range basics is very much where we are laser-focused and not looking at sort of adding kind of ancillary features at this stage.

Cool. And then the other two questions were around sort of the impact upon profitability of discounts and advertising. I think the simple answer on both of those is that we wouldn't expect any change in mix in the first half to the second half. So it has always been a feature of the Buyagift business model that there is some discount which is supplied, which is funded by the company. And that is -- that has historically been sort of the primary sort of way of sort of providing value to customers. So there's a sort of an agreed commission rate with the merchant providers and part of what that has funded is effectively sort of discounting as part of the sort of the trading calendar for Buyagift and Red Letter Days.

What we've actually got better at doing as part of the changes that we've made in the last year and the strengthening of the commercial team is that we're placing a much greater focus on supplementing that with supplier-funded discounts, so that from a consumer perspective, the proposition that they see on the website is stronger and more attractive. And we think actually, we've doubled the number of sort of hero deals that we show on the website through November and December, and that has resonated very well with customers. And alongside that, we've put a lot of work into making sure that the hero deals that we shown on the website are differentiated. So there's something about the proposition, which is unique and attractive to the customer.

It's the same with advertising. Clearly, in a business model which is more focused than Moonpig on paid traffic acquisition to the extent that we sell more in the second half, we spend proportionately more on advertising, but that's just a reflection of the seasonality of trading, and there's no structural change in the economics of the business there. And actually, if you look at the shape of EBITDA margin in H1 versus H2 in previous years, what you'll see is that we actually typically have a higher EBITDA margin in the second half. And I would expect that in H2 of this year, reflecting the fact that, again, it's a business with a degree of operating leverage and November and December are particularly important for Buyagift. So about 4/10 of revenue come through the door in those 2 months of the year.

As there are no further questions on the webinar, I will now hand over to Gareth Davis to read out the written questions. Please go ahead.

Good morning, everyone. This is Gareth Davis from the finance team here at Moonpig. We have a question each from a couple of individuals. Firstly, we have a single question from Caroline Gulliver at Equity Development. It reads, could you add some color on frequency? Although the average is just under three cards per annum, what is the variance? I understand that some customers order one or two cards per annum and then a few customers order cards more frequently. Noting that you've had an 11% increase in reminders, what is the average number of reminders per customer and also the range of reminders per customer? And does this give you any insight into how much you could increase frequency?

Yes. Thanks. So I guess to start like -- maybe the point to start with is if we look at the average Moonpig customer in the U.K. buys 23 cards a year. And we've done this -- we've surveyed, we've spoken to customers. We've done extensive research on this, and that's been kind of verified multiple times. So when we think about the average Moonpig customer being slightly higher than the average U.K. consumer, but there's -- there are 23 cards a year being bought by our customers, and they are on average buying 3 from us. So it leaves 20 is the sort of the white space for us to grow into from our already loyal customer base. And so when we think about how much frequency could increase, there's sort of -- there's an enormous runway. I think that said, if we could get one more card from each customer, I think that would be transformational for the business. If you can kind of get beyond that, I think that's interesting. So there is a huge white space and a long runway for us to grow into.

Reminders are a kind of useful indicator on this. They continue to grow. We have sort of between -- the average customer has set between six and seven reminders, which is kind of an indication of -- to the extent that, that's -- those reminders are either linked to events they've previously bought for or it's linked to kind of events where we've encouraged them to set. Then I think it does give you an indication of kind of maybe the near-term goal should be to absolutely capture all of those reminders. And we've used some pretty interesting kind of tools in the past. So for everyone buying a card at Mother's Day, we've encouraged those customers to set a mother's birthday reminder given we can kind of pre-populate a lot of the information already. And that's been very successful. And so sort of just trying to use kind of user experience and sort of behavioral tools to sort of to drive that next card from customers. And so yes, so I think we continue to try and set more reminders and then convert those better and kind of everything we're doing shows that is working.

The final point was just on the average frequency. Yes, the average is three. But when we break that down, there really is a sort of barbell distribution where you've got sort of 40%, 50% of customers buying one or two cards and the others buying five or six or more cards. And then there's a long tail of customers buying 10, 20, 30, 40, 50 cards a year. So actually, there is a sort of -- there is a point here with Moonpig that kind of -- there are some customers that sort of come once and don't come back. Those tend to be the new customers. But once you're sort of in the Moonpig ecosystem, once you're kind of coming back in that second year, where we've shown the cohorts consistently show those customers essentially never leave, those customers are in that sort of that higher bucket of kind of buying five or six cards. And so actually, the journey of getting them into Plus, getting them up the curve, getting them to seven cards, eight cards, nine cards is the key.

And so we think there's sort of two big opportunities here. One is to get the half of our customers that are already using us to use us more and Plus is a big, big driver of that. The other half is to get a lot of the onetime customers to make sure they do come back for that second and then third card. And that's where a lot of our CRM and promotional incentives go into. And both of those [Technical Difficulty] we've got a pretty clear plan to deliver on.

Secondly, we have a single and final written question from Hamish Adam, an individual investor. It reads what factors will influence how much of the GBP 60 million buyback you complete? And what is your current best estimate of how much you will complete?

I'll take that. Hamish, I mean, look, in the last 12 months, our business has generated GBP 65 million worth of free cash flow. And the great thing about that is that is funding some significant capital returns to shareholders. So as you observe, we've got the GBP 60 million buyback across the year in addition to the fact that we've put up the interim dividend by 25%. We've got a pretty clear approach to how we think about buybacks. And so we do it where there is excess capital, where we're confident that it's earnings accretive. And then actually, we also pay attention to whether or not in terms of return on investment, it's a useful deployment of capital.

In terms of where we stand today, we do have excess capital because we're very well invested in all of the areas that we want to put money into the business. So we've got, what, 10% of revenue has been spent on marketing. We're spending between 4% and 5% of revenue on capital expenditure. And we're doing everything that we can at the moment in our international markets. So as I touched on in one of the earlier questions, the sort of constraint there is around how we get to the point where we're confident in the economics to be able to scale further.

And then in terms of EPS accretion and ROI, I think at the current share price, I think we think that Moonpig investing in itself by buying back its own shares is an attractive use of capital. And therefore, whilst the share price remains at the sort of the current level, my expectation would be that we would continued to spend all of the GBP 60 million on buying back shares. And following the same approach that we've applied throughout each of the last 2 halves, which is broadly to be always on in the market in terms of activity.

Probably the one final thing that I'd note is that actually the total amount of shares which are repurchased in the year will be higher than GBP 60 million because in addition to the purchases by the -- as part of the share buyback program, the employee benefit trust has started to make purchases of shares because we've moved to satisfying share awards through market purchases rather than through dilution. And actually, as we stand today across H1 and H2 to date, the EBT has purchased just under GBP 6 million of shares in addition to the GBP 60 million program. Thank you.

Given there are no further questions, we shall now hand back to Nickyl for closing remarks.

Thank you, everyone. Thanks for all your questions and thank you on a personal note for all the interest and support you've shown to Moonpig over the last few years. I think we are -- I feel like I'm leaving Moonpig in a great place with very good momentum across the group. Fantastic platform, a fantastic team and a huge growth opportunity. And I think that this business is very well placed to deliver extraordinary value for shareholders over the coming years.

Thank you all for your time today. And hopefully, I'll see as many of you as possible over the next couple of weeks on the road show. Otherwise, at a different point. Thank you.

Thank you for joining. We are no longer live. Have a nice day.

Hi, and welcome to the Moonpig Group Half Year Results Presentation. I'm Nickyl Raithatha, CEO, and I'm here today with Andy MacKinnon, our CFO.

First, I'd like to draw your attention to the disclaimer. Please do take some time to read it. In terms of the running order today, I'll start with a quick overview of the half. I'll then turn to Andy to run through the financials in detail, and then I'll close with an update on our strategic progress.

Moonpig Group is the undisputed online leader in a category that is still in the early stages of digital transition with a #1 position in the U.K. and 70% online market share. Our entire business is built on a simple, yet powerful model. We leverage data and technology to drive exceptional customer loyalty and superior engagement. Using levers such as our 100 million reminders and 1 million subscription members, we are consistently able to generate over 90% of our revenue from existing customers. And this translates to a standout financial model that delivers consistent revenue growth, EBITDA margins of 27%, strong cash conversion, and we expect to deliver compound EPS growth of 15% over the medium term. These fundamentals give Moonpig Group all the hallmark characteristics of a true platform business: scalable, profitable and built for sustainable growth.

Turning to the first half of this year. It's been a great period for the group. Moonpig delivered 9.4% revenue growth, outperforming a challenging consumer backdrop. This was underpinned by growth in both customer numbers and gift attach. Greetz successfully returned to growth with a 1.3% increase in constant currency. An EBITDA margin of just under 27% translated to adjusted EPS growth of 13%. We also completed the first half of our GBP 60 million share buyback and have increased our interim dividend by 25%, underscoring our commitment to significant capital returns.

Our ongoing strategic delivery continues to strengthen the foundations for future growth. We saw accelerating growth in our key frequency drivers. Plus subscribers grew 36% to 1 million, reminders increased 11% to 107 million and the use of AI-powered creative features surged 57% to 20 million. Our gift attach rate grew by 50 basis points, supporting growth in AOV, and our new markets delivered impressive self-funded revenue growth of 32% year-on-year.

We have carried this momentum into H2. Since the half year, we have seen continued high growth at Moonpig and a step-up in trading at both Greetz and Experiences, which has had a particularly encouraging peak period so far. At this point in the financial year, our expectations for the full year remain unchanged. With that, I'll pass on to Andy to take you through the results in more detail.

Thanks, Nickyl, and good morning, everyone. We're pleased to report another strong first half with year-on-year growth in both revenue and profit alongside consistent cash generation. H1 revenue increased by 6.7% to GBP 168.6 million, underpinned by the consistent performance of the Moonpig brand and a return to growth of Greetz.

Our margins remain sector-leading. Adjusted EBITDA grew to GBP 45 million with a margin of 26.7%, supported by disciplined cost management and strong operational performance across the group. This flowed through into strong EPS growth. Adjusted basic EPS increased by 13.1% year-on-year to 6.9p, driven by higher profit and the impact of our ongoing share buyback program.

And we continue to generate consistent high-quality cash flow. Over the last 12 months, free cash flow reached GBP 64.5 million, reflecting strong underlying cash conversion and our capital-light business model. This strong consistent cash generation enabled us to increase our interim dividend by 25% to 1.25p and repurchase GBP 30 million shares in H1. For the full year, we intend to buy back up to GBP 60 million of share capital. So overall, a strong financial performance in the first half.

Both our card-first brands are now back in year-on-year growth. And together, Moonpig and Greetz grew revenue by 8.3%. At Moonpig, revenue increased by 9.4%, marking another strong trading period with consistent momentum through the half. The brand continues to perform well across both orders and average order value, reinforcing its clear online market leadership.

Earlier this year, we set out the actions we were taking to strengthen Greetz. We've migrated core services onto the group platform, improved underlying data systems and begun tailoring the user experience to reflect the needs of local customers. These changes have strengthened the foundations of our Dutch business and helped Greetz to return to growth in H1. Revenue improved as the half progressed, rising by 1.3% in constant currency with a foreign exchange tailwind taking reported growth to 3%. That positive momentum has continued into the second half, and we exited H1 with low to mid-single-digit constant currency revenue growth.

Let's look now at the key drivers of revenue growth, starting with average order value. AOV was a significant contributor to revenue growth in the half. Across Moonpig and Greetz, we grew average order value by 5.6%. That increase was driven by a higher gift attach rate and a favorable postage mix, including greater upsell to Moonpig Guaranteed Delivery, our market-leading tracked delivery option for cards. We also optimized pricing and promotions across the half.

The overall attach rate increased by 0.5 percentage points year-on-year to 17.8% with an even stronger uplift of 0.7 percentage points of the Moonpig brand. That reflects the continued expansion of our trusted brand partnerships. In H1, we broadened the range with new launches, including JoJo Maman, Next Flowers and Laura Ashley Flowers. We remain confident that we can deliver continued attach rate growth, underpinned by an active pipeline of new trusted brand launches scheduled for H2, including Lush, Master of Malt and Boots' Liz Earle, Soap & Glory brands.

Turning now to order growth in our active customer base. Together, Moonpig and Greetz delivered order growth of 2.5% in the first half, driven by strong new customer acquisition. Our active customer base grew by 400,000 to 12.1 million with both brands contributing to that increase. New customer acquisition remained efficient, supported by technology improvements such as social sign-on, which has helped simplify account creation. Throughout the period, we also maintained our 12-month payback thresholds.

We don't expect every revenue driver to move in locked up each period. We manage them as a portfolio with different components contributing at different times. In H1, purchase frequency remained stable at 2.95 orders per active customer on a last 12-month basis, which we think is a strong result in the context of a tougher consumer environment. At the same time, we continue to scale the key drivers that support frequency over the medium term.

Occasion reminders grew by 11% to 107 million. Membership of Plus rose by 36% to reach 1 million members and use of creative features increased by 57% on a last 12-month basis, reaching 20 million users. These are unique assets that continue to deepen loyalty and reinforce repeat purchasing across our card-first brands.

I'll now turn to the performance of cards and attached gifting. Moonpig and Greetz both operate a card-first strategy and more than 19 out of every 20 orders of these brands include the card. It was a particularly strong period for card revenue, which grew by 9.7%. This reflects higher order volume, greater upsell to Moonpig Guaranteed Delivery, the scaling of our Plus subscription base and continued growth in card upsell and multi-buy. We also drove 6.8% growth in attached gifting revenue. This was supported in particular by the 0.5 percentage point increase in gift attach rate.

Let me now turn to Experiences, where we've been focused on strengthening performance ahead of the key Christmas trading period. We've made strong progress in repositioning the Experiences business, including putting a new commercial leadership team in place, improving the online experience and broadening the partner range across casual dining, immersive experiences, days out and subscription gifts.

There's naturally a lead time to a shift of this scale. And while the operational progress has been significant, it was not yet reflected in H1 financial performance with revenue down 8.9% year-on-year. Much of our work has been focused on preparing for the peak trading season, the 2-month buildup to Christmas, which typically accounts for around 4/10ths of annual revenue at Experiences. And encouragingly, current trading has improved in the second half to date, including across the early peak trading period and Black Friday. We entered the critical runup to Christmas with clearer operational momentum.

Let's now turn to gross margin performance across the group. We delivered a 3.7% year-on-year increase in H1 gross profit to GBP 97 million. Moonpig's gross margin rate decreased by 1.7 percentage points to 55.8%. The primary effects were mix related, reflecting higher gift attachment, greater use of track postage and continued expansion in Ireland, Australia and the U.S. There was also an impact from increased shipping costs and fulfillment wages.

Looking ahead, Moonpig's margin will benefit in the second half from in-sourcing giant card fabrication and the introduction of automated parcel sortation, both of which were completed in November.

At Greetz, the gross margin rate increased by 0.4 percentage points. We will shortly transition flowers fulfillment in the Netherlands to the same partner we use in the U.K., enabling us to better leverage group-wide scale. This is expected to deliver a modest uplift to Greetz's margin from the fourth quarter, together with improvements in range and customer experience.

In Experiences, the gross margin rate increased by 0.8 percentage points, reflecting a higher mix of direct sales and digital voucher delivery in the period. We increased adjusted EBITDA margin rate to 26.7%, while delivering GBP 45 million of adjusted EBITDA. At Moonpig, we maintained adjusted EBITDA margin at 30% even with a lower gross margin rate. This reflects planned indirect cost discipline, the benefits of operational leverage and a lower share-based payment charge.

At Greetz, we completed the headcount restructuring in late FY '25. This reduced the indirect cost base, enabling a 3.5 percentage point increase in margin. It also allowed us to refresh and strengthen the team, supporting the improved trajectory that we've seen through the half.

At Experiences, we have managed the indirect cost base tightly, delivering cost efficiencies that enabled a 2.1 percentage point improvement in adjusted EBITDA margin. Strong delivery at the EBITDA line translated into even stronger performance further down the P&L with adjusted PBT increasing by 11.4% to GBP 30.5 million. Depreciation and amortization reduced slightly to GBP 8.9 million, reflecting the relatively low level of capital expenditure in the previous 2 years.

Net finance costs rose to GBP 5.7 million. Lower interest on bank borrowings and leases was more than offset by foreign exchange differences on euro-denominated debt. The GBP 0.9 million movement reflects FX losses this year compared to gains in the prior period. Adjusted basic EPS increased by 13.1% to 6.9p, supported by higher profit and the impact of buybacks on our issued share capital. Over the last 12 months, we canceled 24.5 million shares, just over 7% of share capital, and we have now moved to using market purchase shares to settle future employee share scheme vesting.

Let's turn now to how our profit translates into cash. We consistently generate strong free cash flow. That reflects our high-margin, asset-light business model and our negative net working capital position. Free cash flow remained strong at GBP 64.5 million across the last 12 months. As always, most of that cash generation was delivered in the second half, reflecting seasonality in both trading and working capital with H1 representing 13% of the total.

H1 free cash flow was GBP 8.6 million, slightly lower than the GBP 10.1 million delivered last year, reflecting higher CapEx from our planned investment in automation and in-sourcing at Tamworth. We expect full year CapEx to be around GBP 19 million. Our consistent cash generation supports balance sheet strength and underpins our capital allocation across dividends and buybacks.

This half again highlights the scale of capital we are returning to shareholders. Our capital allocation priorities remain unchanged. With growth priorities fully funded and no significant M&A in contemplation, our focus remains firmly on returning excess capital to shareholders. Our medium-term target remains net leverage of around 1x, and we expect to be around that level at the year-end. At the half year point, leverage was 1.24x, reflecting typical seasonality.

We operate a progressive dividend policy, targeting dividend cover of 3x to 4x over the medium term. With this in mind, the Board has declared an interim dividend of 1.25p, representing 25% year-on-year growth. Alongside dividends, we are returning significant capital through buybacks. We intend to repurchase up to GBP 60 million shares in FY '26. The first half GBP 30 million program has been completed and the second half program is underway.

In addition to the GBP 60 million, our Employee Benefit Trust has purchased GBP 1.8 million shares in H1 and a further GBP 4 million so far in H2 as we've now moved to settling obligations under employee share plans through market purchases subject to the prevailing share price. We approach buybacks with discipline, undertaking them only when they are EPS accretive, funded from excess capital and offer an attractive return on investment.

Now to close, I'll finish with an update on current trading and our outlook for the rest of the year. As we highlighted in this morning's RNS announcement, overall group trading performance has remained in line with our expectations since the start of the second half. Growth remains underpinned by consistent strong revenue growth at Moonpig and positive trading momentum at Greetz. Current trading experiences has been encouraging with improved performance in the second half to date. Our expectations for the full year remain unchanged.

And with that, I'll hand back to Nickyl for his final update as CEO on strategic progress. Thank you.

Thank you, Andy. I'll now give an update on the strategic progress we've been making across the business.

We are the clear online leader in a category that is still in the early stages of digital transition. Our strategy is simple and effective. We lead with cards and attached gifts, maximizing both customer loyalty and profitability. Cards are not just the starting point of the journey. They're the engine of our data advantage. They provide incredibly rich insight into customer behavior, which we use to build loyalty, increase purchase frequency and cross-sell gifts in a highly personalized way.

With over 60% of cards typically given alongside the gift, our model enables us to capture this incremental gifting opportunity without additional marketing spend using our cross-sell page to surface relevant gifts based on each customer's preferences. What makes this model particularly powerful is the way it compounds over time. We profitably acquire sticky customers who then layer on top of previous cohorts. With over 90% of revenue coming from existing customers, this is the foundation of our ability to drive sustainable, profitable growth.

We have a long runway for growth ahead, and it's most clearly reflected in the 3 compounding levers that drive our model. First, we're continuing to capture more card buyers across our markets. Second, we're increasing the number of cards each customer sends through us annually. And third, we're driving more gifts into the basket with each purchase. These levers work together to create a powerful compounding effect, expanding our customer base, deepening engagement and increasing average order value over time. Together, they underpin our expectation for consistent strong top line growth. Over the past 5 years, we've made clear progress across all 3, demonstrating the strength and resilience of our growth model.

Our active customer base continues to scale, growing 3% year-on-year to over 12 million customers. In the past months, we've really doubled down on our partnership strategy, leveraging the reach and brand affinity of other brands to enhance customer awareness, acquisition and engagement. Furthermore, we are proactively positioning ourselves for the future growth in traffic from large language models, where our early generative engine optimization activities are already showing encouraging visibility.

One of our major loyalty drivers is Moonpig Plus, our subscription service, which continues to deliver meaningful value to both customers and the business. We've now hit over 1 million members, representing 36% growth year-on-year. We continue to see clear uplifts in order frequency, attach rates and strong renewal behavior and have clear road maps to drive further improvements in each of these metrics over time with UX features and personalization initiatives at the core.

The reminders ecosystem remains one of our most powerful assets, with approximately 40% of our orders placed shortly after an occasion reminder is sent. Customers have now set 107 million reminders, up 11% on the year. We are focused on continuously launching improvements that not only encourage customers to set more reminders, but more importantly, help them to convert at demonstrably higher rates.

We continue to innovate using the latest technologies to improve the customer experience and to ensure we continue to deliver the world's most personalized cards. One feature we've launched this half is a really exciting experience upgrade for customers. They can simply select the age of the birthday and every appropriate card on the website will automatically be shown with that number prepopulated. This is something that has only recently become possible with developments in AI. And as we gain customer feedback, we can then extend this to recipient names to occasions and so on, which when combined with our reminders data can really deliver a personalized shopping experience like no other.

Our AI-driven creative features continue to scale amongst our customer base as we surged past 50% of all cards now including a creative feature. We now also have data showing that this usage directly benefits future frequency. And so we continue to launch new features with the next one being Face Swap coming soon.

Our gift attach rate continues to grow, principally driven by the momentum we have in our gifting range. This half continued to build on the brands we added in the previous period with exciting additions to our flowers, children's and beauty categories. And we also launched a new innovation and experience gifting on Moonpig with digital multi-choice vouchers seeing initial strong success. We continue to invest in our operations to enhance efficiency and to elevate the customer experience.

Our guaranteed delivery is now used for 40% of occasions, showing the value customers place on our cards arriving on time. We have upgraded our Tamworth facility, bringing giant card production in-house and building new automation capabilities, both of ich will save costs and also allow for better service levels. And excitingly, our new AI customer service tool is already successfully resolving 1/3 of all queries with a higher customer satisfaction score than before, and we expect this to grow rapidly in the future.

The final phase of the transformation of our Experience business is now firmly underway. And in particular, in recent weeks, we have started to see the compounding benefits of a new technology platform, new organizational capabilities and a breadth of new suppliers and products coming together.

We are releasing upgrades to the on-site experience at a faster pace than ever before, constantly making it easier for customers to find the products that they want. And those products are getting more exciting. We've added a wealth of products to the site, both household brands such as Pizza Express and Spotify, but also topical high-demand products such as the Traitors and the Clarkson's Farm experiences. And these changes are delivering an encouraging start to the peak period so far.

Finally, our expansion into new markets continues at a healthy pace with combined revenues growing 32% year-on-year. Ireland is now sustainably profitable with growth this period supported by continued improvements to the gifting range, including launching flowers for the first time.

Australia is scaling well and approaching the point of profitable growth. This half, we focused on developing the core gifting range and improving delivery services. The U.S. remains in experimentation phase, focused on learning, testing and refining the model before we scale further.

In summary, the group is in a period of strong momentum across the board. The first half of the year saw profit before tax up 11% and EPS up 13%. And we have had a strong start to the second half with consistent performance at Moonpig and a step-up at Greetz and Experiences in the second half so far. Our model continues to deliver strong earnings growth, high margins and consistent free cash flow, enabling us to grow our dividend and to continue significant share buybacks while continuing to invest for the long term.

Looking ahead, the group will remain focused on executing against clear growth levers, scaling the international opportunity and further enhancing the customer proposition through technology.

As this is my final results presentation, I also wanted to take the opportunity to thank the extraordinary employees of Moonpig Group for supporting me on this incredible journey over my last 7 years as Chief Executive. As I hand over the reins to my successor, I'm confident in the team's ability to continue the momentum across the business and to deliver sustained long-term growth and value creation for our shareholders.

Thank you for listening and see you shortly at the Q&A.