An in line Q1 update from The Innovation Group (TIG) points to another positive year for the insurance business process services (BPS) player in 2013, after notching up 10% growth in FY12 (see Innovation Group more than delivers the goods). TIG said it is delivering good levels of cash, and the conversion rate of EBITDA to operating cash flow remains strong. Consensus estimates put TIG’s FY13 revenues at c£208m, which should show growth of over 7% at the top line.
As we noted yesterday, TIG is securing some key renewals (see TIG and Steria renew BPS deals), and it is now making some positive noises in the US market. Since last October it has signed new deals with Homesite for its Insurer Claims and Insurer Analytics software, and with Austin Mutual Insurance Company, for Innovation Auto to provide end-to-end auto claims and repair services for its personal and commercial auto business across nine states.
Additionally TIG is seeking new partnerships to help broaden its reach and access to new customers, including with Xuber for analytics (see Innovation Group and Xchanging partner over analytics), and auto repair software provider AutoRestore across its UK network of 130 bodyshops. Perhaps most interesting is its new partnership with legal services provider DAC Beachcroft to offer an extended motor claims handling service in the UK. TIG’s partnering approach is very different from the aggressive M&A route being pursued by rival Quindell Portfolio (see here). We are meeting TIG’s CEO next month and will be sure to update subscribers on the strategy then.