REG - Hansard Global plc - New business results for the year ended 30/06/2023

Hansard GlobalAnnouncement

27/07/2023 07:15

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RNS Number : 3040H  Hansard Global plc  27 July 2023

 

27 July 2023

 

 

Hansard Global plc

New business results for the year ended 30 June 2023

 

 

Hansard Global plc ("Hansard" or "the Group"), the specialist long-term
savings provider, issues its trading update for the quarter ended 30 June 2023
("Q4 2023").  All figures refer to this period, except where indicated.
 Financial year ("FY 2023") figures refer to 1 July 2022 to 30 June 2023.

Summary

·    New business for the financial year ended 30 June 2023 was £85.7m in
PVNBP ("Present Value of New Business Premiums") terms, down 28.9% from
£120.5m in FY 2022.

·   New business for Q4 2023 was £16.9m, 31.9% lower than £24.8m in Q4
2022 (incorporating the impact of annual changes in actuarial assumptions to
the calculation of PVNBP in Q4).

·    New business for the quarter and financial year was impacted by a
general hesitancy by clients to commit to long-term savings products
reflecting on-going economic uncertainty, geopolitical developments, and the
aftermath of Covid-19 restrictions around the world.

·     Assets under administration were £1.1bn as at 30 June 2023, in line
with £1.1bn at 30 June 2022.

·  The Group continues to make positive progress with distribution
opportunities for our Japan proposition, and continues work to make targeted
refinements to our proposition in our current core markets.

·  The Group remains on track to replace its policy administration systems
to support the next generation of products whilst realising associated cost
and efficiency gains.

Graham Sheward, Group Chief Executive Officer, commented:

"Consistent with our strategy, we continue to focus our efforts proactively on
distribution opportunities for our Japanese proposition and good progress
continues to be made.

More generally, we are working hard to improve new business levels through a
combination of new product development, new broker relationships and the
deployment of additional experienced sales management executives into the
business.

We are confident that our new product pipeline will lead to increased sales
and long term growth in the business."

 

For further information:

Hansard Global plc
                         +44 (0) 1624 688 000

Graham Sheward, Group Chief Executive Officer

Thomas Morfett, Chief Financial Officer

Email: investor-relations@hansard.com

Camarco
                                   +44 (0) 7990 653 341

Ben Woodford, Hugo Liddy

Hansard Global plc

TRADING UPDATE for the PERIOD ended 30 June 2023

 

 

OVERVIEW

The Group continues to focus on the distribution of regular and single premium
savings and investment products in a range of jurisdictions around the
world.

New business for the quarter and financial year continued to be impacted by a
general hesitancy by clients to commit to long-term savings products ,
particularly those with contractual regular premiums, reflecting ongoing
global economic uncertainty, geopolitical developments, and the aftermath of
Covid-19 restrictions around the world. This was particularly acute in our
Rest of the World and Far East regions.

In Present Value of New Business Premiums ("PVNBP") terms, new business for Q4
2023 was 31.9% lower than Q4 2022. For the year ended 30 June 2023, new
business was 28.9% lower compared to the prior year comparative.

The comparisons for Q4 are impacted by our annual assessment of actuarial
assumptions which take place each year in Q4 and are reflected in the Q4
results. The Q4 2022 review incorporated positive adjustments which increased
the value of new business premiums assigned to regular premium savings plans,
whereas the review in Q4 2023 resulted in a negative adjustment. Further
analysis of this impact is outlined in more detail below.

New Business Flows

New business flows for the quarter and the year ended 30 June are summarised
as follows:

                                                                         Three months ended               Year ended
                                                                         30 June                          30 June
                                                                         2023      2022     %             2023   2022    %
 Basis                                                                   £m        £m       change        £m     £m      change
 Present Value of New Business Premiums                                  16.9      24.8     (31.9%)       85.7   120.5   (28.9%)

 Present Value of New Business Premiums excluding the impact of annual
 assumption changes made in Q4 of the relevant year

                                                                         17.9      22.3     (19.7%)       86.7   118.0   (26.5%)
 Annualised Premium Equivalent                                              2.7    3.2      (15.6%)       12.7   16.4    (22.6%)

 

The present value of new business premiums is influenced, amongst other
factors, by the Group's expectations of future premium collections on regular
premium contracts issued during the year. Where these expectations at year end
are different from the assumptions used in the calculation in prior quarters,
the assumptions are amended in Q4 to better report the cumulative value of new
business. This adjustment is reflected in the Q4 reported new business figures
and can, where material, impact the underlying Q4 result.

 

In the prior year, improved experience in the collection of premiums over the
lifetime of policy contracts resulted in an increase to PVNBP for the year of
£2.5m, reflected in Q4 2022.  For the 2023 financial year, the change in
assumptions gave a decrease of £1.0m, reflected in Q4 2023.

 

Excluding the impact of those adjustments, new business was down 19.7% for Q4
2023 versus Q4 2022, and down 26.5% for FY 2023 versus FY 2022 (as shown in
line 2 of the table above).

 

In Annualised Premium Equivalent ("APE") terms, new business was down 15.6%
for the quarter and down 22.6% for the year. APE figures are unaffected by the
updated assumptions above.

The split of regular and single new business premiums on the PVNBP basis was
as follows:

                        Three months ended             Year ended
                        30 June                        30 June
                        2023     2022     %            2023  2022   %
 PVNBP by product type  £m       £m       change       £m    £m     change
 Regular premium        11.4     17.2     (33.7%)      55.7  76.9   (27.6%)
 Single premium         5.5      7.6      (27.6%)      30.0  43.6   (31.2%)
 Total                  16.9     24.8     (31.9%)      85.7  120.5  (28.9%)

 

The regional split of new business premiums on the PVNBP basis was follows:

                             Three months ended             Year ended
                             30 June                        30 June
                             2023     2022     %            2023  2022   %
 PVNBP by geographical area  £m       £m       change       £m    £m     change
 Middle East and Africa      7.7      9.3      (17.2%)      42.4  44.3   (4.3%)
 Latin America               6.4      7.5      (14.7%)      25.7  28.2   (8.9%)
 Rest of World               0.8      5.5      (85.5%)      12.1  33.9   (64.3%)
 Far East                    2.0      2.5      (20.0%)      5.5   14.1   (61.0%)
 Total                       16.9     24.8     (31.9%)      85.7  120.5  (28.9%)

 

 

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 70% 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 Q4 2023, AuA decreased by £15.4m or 1.4%. For the year ended 30 June
2023, AuA increased £8.1m or 0.7%.

 

The following analysis shows the components of the movement in AuA during the
period:

 

                                                      Three months ended                 Year ended
                                                                 30 June                            30 June
                                                      2023           2022                2023           2022
                                                      £m             £m                  £m             £m
 Deposits to investment contracts - regular premiums  20.4           21.3                86.1           86.2
 Deposits to investment contracts - single premiums   5.7            7.6                 30.2           43.8
 Withdrawals from contracts and charges               (39.7)         (37.9)              (148.3)        (158.4)
 Effect of market and currency movements              (1.8)          (70.4)              40.1           (103.5)
 (Decrease) / increase in period                      (15.4)              (79.4)         8.1            (131.9)
 Opening balance                                      1,115.8        1,171.7             1,092.3        1,224.2
 Assets under Administration at 30 June               1,100.4        1,092.3             1,100.4        1,092.3

 

The movement in AuA is split as follows between Hansard International
(incorporating business reinsured from Hansard Worldwide) and Hansard Europe:

                                  Three months ended                Year ended
                                             30 June                           30 June
                                  2023           2022               2023           2022
                                  £m             £m                 £m             £m
 Hansard International            (13.1)         (70.0)             12.2           (110.2)
 Hansard Europe                   (2.4)          (9.4)              (4.1)          (21.7)
 (Decrease) / increase in period  (15.4)         (79.4)             8.1            (131.9)

 

Results for the year ENDing 30 JUNE 2023

Full trading results for the year are scheduled to be announced on 28
September 2023.

OUTLOOK

We continue to expect sales of long-term savings products through Independent
Financial Advisors will be impacted by global economic headwinds in the near
term. Looking further forward however we are confident that our new product
pipeline will lead to increased sales and long term growth in the business.

 

 

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

 

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