Trading update for the period ended 31 March 2019

RNS Number : 4438Y

Hansard Global plc

09 May 2019

 

9 May 2019

Hansard Global plc

Trading update for the period ended 31 March 2019

Hansard Global plc ("Hansard" or "the Group"), the specialist long-term savings provider, issues its trading update for the quarter ended 31 March 2019 ("Q3 2019").  All figures refer to this period, except where indicated.  Year to date figures refer to 1 July 2018 to 31 March 2019.

Summary

·     New business for Q3 2019 was £34.1m in PVNBP ("Present Value of New Business Premiums") terms, an increase of 4% on Q3 2018;

·     Overall for the year to 31 March 2019, new business was £108.3m compared with the prior year period level of £109.8m;

·     The momentum with our locally licensed venture in the UAE has continued and is delivering very solid growth.  New business in the Middle East & Africa region in Q3 2019 was up 14% compared to Q3 2018 and up 35% year to date;

·     We continue to see mixed results in other regions as both Hansard and distributors reposition aspects of their business in line with strategic and regulatory objectives;

·     Assets under administration recovered in line with global stock markets and were £1.03 billion at 31 March 2019 (£975m at 31 December 2018).

Gordon Marr, Group Chief Executive Officer, commented:

"We are pleased to have delivered a further quarter of new business growth with the main highlight clearly our locally-licensed partnership in the UAE. We remain optimistic that opportunity for growth exists across each of our regions and continue in particular to make progress in our licence application process in Japan."

For further information:

Hansard Global plc	[phone]
Gordon Marr, Group Chief Executive Officer
Tim Davies, Chief Financial Officer
Email: [e-mail]
Camarco	[phone]
Ben Woodford, Kimberley Taylor, Rebecca Noonan

Hansard Global plc

TRADING UPDATE for the PERIOD ended 31 March 2019

OVERVIEW

The Group continues to focus on the distribution of regular and single premium products in a range of jurisdictions around the world, achieving well diversified new business growth.

In Present Value of New Business Premiums ("PVNBP") terms, new business for Q3 2019 grew 4% to £34.1m.  New business for the nine months to 31 March 2019 was £108.3m, 1% down on the prior year comparative period.  The primary driver of growth in 2019 continues to come from our strategic relationship in the UAE. 

New Business Flows

New business flows for Hansard International for the quarter and the nine months ended 31 March are summarised as follows:

	Three months ended				Nine months ended
	31 March				31 March
	2019	2018	%		2019	2018	%
Basis	£m	£m	change		£m	£m	change
Present Value of New Business Premiums	34.1	32.8	4.0%		108.3	109.8	(1.4%)
Annualised Premium Equivalent ("APE")	6.0	4.8	25.0%		17.8	16.9	5.3%

The percentage increase in new business under the PVNBP and APE measures above differ more than normal in this period because of a significant change in the mix of regular and single premiums.  The increased proportion of regular premiums in Q3 2019 gets a higher proportional credit under the APE metric than under the PVNBP metric.

New business flows for Hansard International on the basis of PVNBP are broken down as follows:

	Three months ended				Nine months ended
	31 March				31 March
	2019	2018	%		2019	2018	%
PVNBP by product type	£m	£m	change		£m	£m	change
Regular premium	19.6	13.9	41.0%		57.0	51.8	10.0%
Single premium	14.5	18.9	(23.3%)		51.3	58.0	(11.6%)
Total	34.1	32.8	4.0%		108.3	109.8	(1.4%)

	Three months ended				Nine months ended
	31 March				31 March
	2019	2018	%		2019	2018	%
PVNBP by geographical area	£m	£m	change		£m	£m	change
Middle East and Africa	14.5	12.7	14.2%		39.2	29.0	35.2%
Rest of World	11.7	9.6	21.9%		37.9	40.6	(6.7%)
Latin America	4.5	5.6	(19.6%)		17.6	19.6	(10.2%)
Far East	3.4	4.9	(30.6%)		13.6	20.6	(34.0%)
Total	34.1	32.8	4.0%		108.3	109.8	(1.4%)

Our Middle East and Africa region continues to outperform, driven primarily by the continuing growth of our strategic relationship in the UAE.  New business was up 14% for the quarter and 35% year to date.  This business is predominantly regular premium, which can be seen in the regular premium growth of 41% compared to Q3 2018.

The Rest of World region grew 22% from Q3 2018, broadly in line with its 2019 quarterly run-rate and benefiting from the early adoption of our recently launched insurer in the Bahamas, Hansard Worldwide Limited ("Hansard Worldwide").

In Latin America, the PVNBP measure of volume was lower for Q3 2019 as smaller sized policies were sold and brokers transition to Hansard Worldwide. The overall quantity of policies sold year to date continues to be higher than the previous year.  We expect to see a stronger Q4 as Hansard Worldwide adoption increases and the effect of an additional Account Executive for the region starts to have a positive effect. 

As communicated in previous announcements, new business in our Far East region is down while we re-position towards locally licensed business in a similar manner to that successfully implemented in the Middle East. 

Assets under Administration ("AUA")

The composition and value of AuA is based upon the assets selected by or on behalf of contract holders to meet their savings and investment needs.  Reflecting the wide geographical spread of the Group's customer base, the majority of premium contributions and of AuA are designated in currencies other than sterling.  Over 60% of Group AuA are denominated in US dollars.

The total of such assets is affected by the level of new premium contributions received from new and existing policy contracts, the amount of assets withdrawn by contract holders, charges and the effect of investment market and currency movements. These factors ultimately affect the level of fund-based income earned by the Group.

Net withdrawals are typically experienced in Hansard Europe dac ("Hansard Europe"), which closed to new business in 2013.  

During Q3 2019 AuA increased by £50.6m or 5.2%, reflecting a recovery in global stock markets during the period and leaving the year to date position down by just under 1%.

	Three months ended			Nine months ended
	31 March			31 March
	2019	2018		2019	2018
	£m	£m		£m	£m
Deposits to investment contracts - regular premiums	19.9	14.9		59.6	57.3
Deposits to investment contracts - single premiums	14.1	22.3		51.1	57.4
Withdrawals from contracts and charges	(39.2)	(45.4)		(116.9)	(143.2)
Effect of market and currency movements	55.8	(46.0)		(3.7)	12.1
	50.6	(54.2)		(9.9)	(16.4)
Opening balance	975.5	1,087.5		1,036.0	1,049.7
Assets under Administration at 31 March	1,026.1	1,033.3		1,026.1	1,033.3

 

The movement in AuA is split as follows between Hansard International and Hansard Europe:

				Nine months ended
				31 March
				2019	2018
				£m	£m
Hansard International				3.4	8.9
Hansard Europe				(13.3)	(25.3)
Increase / (decrease) in period				(9.9)	(16.4)

Results for the year ENDing 30 JUNE 2019

New business results for the full-year are scheduled to be announced on 25 July 2019. Trading results for the full-year are expected to be announced on 26 September 2019.

Outlook

Over the course of the remainder of our financial year we expect to see the strong growth from our strategic relationship in the UAE be maintained.  Based on current run-rates we expect to finish ahead of our 2018 new business total. 

 

Notes to editors:

·     Hansard Global plc is the holding company of the Hansard Group of companies. The Company was listed on the London Stock Exchange in December 2006. The Group is a specialist long-term savings provider, based in the Isle of Man.

·     The Group offers a range of flexible and tax-efficient investment products within a life assurance policy wrapper, designed to appeal to affluent, international investors.

·     The Group utilises a controlled cost distribution model via a network of independent financial advisors, and the retail operations of certain financial institutions who provide access to their clients in more than 170 countries. The Group's distribution model is supported by Hansard OnLine, a multi-language internet platform, and is scalable.

·     The principal geographic markets in which the Group currently services contract holders and financial advisors are the Middle East & Africa, the Far East and Latin America.  These markets are served by Hansard International Limited and Hansard Worldwide Limited.

·     Hansard Europe dac previously operated in Western Europe but closed to new business with effect from 30 June 2013. 

·     The Group's objective is to grow by attracting new business and positioning itself to adapt rapidly to market trends and conditions. The scalability and flexibility of the Group's operations allow it to enter or develop new geographic markets and exploit growth opportunities within existing markets without the need for significant further investment.

Forward-looking statements:

This announcement may contain certain forward-looking statements with respect to certain of Hansard Global plc's plans and its current goals and expectations relating to future financial condition, performance and results. By their nature forward-looking statements involve risk and uncertainties because they relate to future events and circumstances which are beyond Hansard Global plc's control. As a result, Hansard Global plc's actual future condition, performance and results may differ materially from the plans, goals and expectations set out in Hansard Global plc's forward-looking statements. Hansard Global plc does not undertake to update forward-looking statements contained in this announcement or any other forward-looking statement it may make. No statement in this announcement is intended to be a profit forecast or be relied upon as a guide for future performance.

This announcement contains inside information which is disclosed in accordance with the Market Abuse Regime.

Legal Entity Identifier: 213800ZJ9F2EA3Q24K05

 

END

 

 

TSTKMGGKMRGGLZZ