8 November 2018 Hansard Global plc Trading update for the quarter ended 2018 Hansard Global plc ( Hansard or the Group ), the specialist long-term savings provider, issues its trading update for the period from 1 July 2018 to 2018 (Q1 FY 2019), except where indicated. Summary New business for Hansard International Limited ( Hansard International ) for the quarter to 2018 was 32.6m in PVNBP ( Present Value of New Business Premiums ), 15.5% lower than Q1 of the prior year; Primary driver of reduced new business is the Far East where we are in the process of re-positioning to locally licenced business; Continued positive growth of our locally licensed business relationship in the UAE; Assets under administration marginally up on previous quarter to 1.04 billion; New subsidiary in the Bahamas to commence trading on 1 January 2019. Gordon Marr, Group Chief Executive Officer, commented: We have continued to make good progress on our strategic re-positioning activities during the past quarter. While our actions to exit certain distribution channels have led to lower sales in the short term, we expect that the development of further licenses across our markets will deliver growth in the near, medium and long terms. We expect to be in a position to further outline our strategic opportunities and progress at an investor day which we plan to hold in the new year. For further information: Hansard Global plc +44 (0) 1624 688 000 Gordon Marr, Group Chief Executive Officer Tim Davies, Chief Financial Officer Email: investor-relations@hansard.com Camarco +44 (0) 203 757 4980 Ben Woodford, Kimberley Taylor, Rebecca Noonan Legal Entity Identifier: 213800ZJ9F2EA3Q24K05
HANSARD GLOBAL plc NEW BUSINESS RESULTS FOR THE QUARTER ENDED 30 SEPTEMBER 2018 OVERVIEW The Group continues to focus on the distribution of regular and single premium products in a range of jurisdictions around the world. In Present Value of New Business Premiums ( PVNBP ) terms, levels of new business in Q1 FY 2019 were 15.5% below Q1 FY 2018 and 11.4% below Q4 FY 2018. As outlined within our full year results released in September, business is significantly lower in our Far East region while we re-position towards locally licensed business in that region. We expect to be in a position to announce further progress on this process in the near term. NEW BUSINESS FLOWS New business flows for Hansard International for Q1 FY 2019 on our key internal metrics are summarised as follows. Basis m m change Present Value of New Business Premiums 32.6 38.6 (15.5%) Annualised Premium Equivalent 5.0 6.1 (18.0%) Present Value of New Business Premiums ( PVNBP ) New business flows for Hansard International for Q1 FY 2019 on the basis of PVNBP are analysed in the following two tables as follows: PVNBP by product type m m change Regular premium 15.5 19.3 (19.7%) Single premium 17.1 19.3 (11.4%) Total 32.6 38.6 (15.5%) PVNBP by geographical area m m change Rest of World 12.3 13.7 (10.2%) Middle East and Africa 8.8 8.5 3.5% Latin America 7.0 7.7 (9.1%) Far East 4.5 8.7 (48.3%) Total 32.6 38.6 (15.5%) Page 1 of 4
Overall business levels for Q1 FY 2019 saw reductions to both regular and single premiums compared to Q1 FY 2018. Notwithstanding that, we did see pleasing on-going growth from our licensed business relationship in the UAE. This is now a substantive part of the Middle East and Africa region s sales demonstrating how our strategy of repositioning towards locally licensed business is delivering. In Latin America, despite the PVNBP measure of volume being down 9%, the numbers of policies sold were up by over 20% and business activity levels continued to be strong. Q1 FY 2018 contained a large single premium contribution of 1.4m which distorts a more like-for-like comparison. Q1 FY 2019 new business was 13% higher than the final quarter of last year, Q4 FY 2018. As outlined in our 2018 financial year results released in September, new business has declined in our Far East region while we exit certain distribution channels and re-position towards locally licensed business in a similar way to what we have done in the Middle East. We expect to see that re-positioning to restore growth later in 2019. The Rest of World and Middle East & Africa regions were affected in the period by two of our larger brokers focusing on a change in ownership and the retention of key sales staff respectively. More generally in the market place, we have observed greater product competition. There is a trend for Independent Financial Advisors ( IFAs ) to focus increasingly on lump sum new business which has increased price competition and affected our single premium sales for the period. 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. AuA levels are affected by the level of new premium contributions received from new and existing policy contracts, the amount of assets withdrawn by contract holders (including those withdrawn from Hansard Europe, which closed to new business in 2013), charges and the effect of investment market and currency movements. These factors ultimately affect the level of fundbased income earned by the Group. The value of AuA is underpinned by a steady flow of regular contributions from new and existing contract holders around the world. Net withdrawals are typically experienced in Hansard Europe, which closed to new business in 2013. In aggregate, AuA increased marginally in Q1 FY 2019 from the opening position as at 30 June 2018. This was driven by modest investment market gains. Page 2 of 4
2018 2017 m m Deposits to investment contracts regular premiums 19.6 21.0 Deposits to investment contracts single premiums 17.1 17.3 Withdrawals from contracts and charges (41.4) (52.8) Effect of market and currency movements 11.5 15.3 Increase / (decrease) in period 6.8 0.8 Opening balance 1,036.0 1,049.7 Assets under Administration at 1,042.8 1,050.5 The movement in AuA is split as follows between Hansard International and Hansard Europe: 2018 2017 m m Hansard International 8.4 8.5 Hansard Europe (1.6) (7.7) Increase / (decrease) in period 6.8 0.8 RESULTS FOR THE HALF-YEAR ENDING 31 DECEMBER 2018 New business results for the half year ending 31 December 2018 are expected to be announced on 24 January 2019. Trading results for the half year are expected to be announced on 7 March 2019. OUTLOOK As mentioned in our full year results released in September, we expect business to be lower in our Far East region while we re-position towards locally licensed business in that region. Notwithstanding this, we remain confident that continued progress with our strategic initiatives this year will result in attractive future growth. We are currently seeing our current year Q2 new business levels running higher than Q2 of last year. We expect our new subsidiary in the Bahamas to commence trading on 1 January 2019, helping to support the on-going development of our Latin American and global expatriate business. Page 3 of 4
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 contract wrapper, designed to appeal to affluent, international investors. The Group utilises a controlled cost distribution model by selling policies exclusively through 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 scaleable. The principal geographic markets in which the Group currently services contract holders and financial advisors are the Middle East, the Far East and Latin America, in the case of Hansard International Limited, and Western Europe in the case of Hansard Europe Designated Activity Company, the Group s two life assurance companies. Hansard Europe Designated Activity Company ceased accepting 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 scaleability 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. Following the closure of Hansard Europe Designated Activity Company to new business with effect from 30 June 2013, the Group continues to report new business performance of Hansard International Limited alone within this document. Reporting of Assets under Administration incorporates cash flows relating to insurance contracts issued by both Hansard International Limited and Hansard Europe Designated Activity Company. 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 Page 4 of 4