REG - Hansard Global plc - Trading update for the period ended 31 March 2022

Hansard GlobalAnnouncement

05/05/2022 07:01

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220505:nRSE3419Ka&default-theme=true

RNS Number : 3419K  Hansard Global plc  05 May 2022

 

 

 

 

 

5 May 2022

 

 

Hansard Global plc

Trading update for the period ended 31 March 2022

 

 

Hansard Global plc ("Hansard" or "the Group"), the specialist long-term
savings provider, issues its trading update for the quarter ended 31 March
2022 ("Q3 2022").  All figures refer to this period, except where indicated.
 Year to date ("YTD") figures refer to 1 July 2021 to 31 March 2022.

 

Summary

·    New business for the Group for Q3 2022 was £30.9m in PVNBP ("Present
Value of New Business Premiums") terms (Q3 2021: £47.3m, Q2 2022: £33.5m);

·    For the nine months to 31 March 2022, new business was £95.8m (Q3
YTD 2021: £123.6m);

·    Assets under administration were £1.17bn at 31 March 2022 (£1.23bn
at 31 December 2021);

·    The Group continues to work with its prospective Japanese
distribution partner towards a suitable launch date, against the current
challenging background of Covid-19 in Japan.

 

Graham Sheward, Group Chief Executive Officer, commented:

"As our targeted region of Japan remains under Covid-19 restrictions with
increased case counts, we continue to work with our local distribution partner
towards a suitable launch date.

 

We also continue to take vigorous action to improve new business levels both
with respect to our traditional business and by progressing opportunities to
deploy new products more widely in Japan and other suitable territories around
the world.  In addition to the new initiatives mentioned in our previous
quarterly trading update, we have recently recruited two experienced
executives into our sales and business development team in order to assist the
delivery of this growth."

 

For further information:

Hansard Global
plc
+44 (0) 1624 688 000

Graham Sheward, Group Chief Executive Officer

Tim Davies, 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 31 March 2022

 

 

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-to-date continued to be
impacted by the challenges of Covid-19 restrictions and their aftermath around
the world, economic uncertainty and a general hesitancy by clients to commit
to contractual long-term savings products.  The prior period comparative
figures benefited from a number of high net worth single premium policies
which did not repeat in Q3 2022.

In Present Value of New Business Premiums ("PVNBP") terms, new business for Q3
2022 was 34.7% lower than Q3 2021. For the nine months ended 31 March 2022,
new business was 22.5% lower compared to the prior period comparative.

 

New Business Flows

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

                                         Three months ended             Nine months ended
                                         31 March                       31 March
                                         2022     2021     %            2022    2021    %
 Basis                                   £m       £m       change       £m      £m      change
 Present Value of New Business Premiums  30.9     47.3     (34.7%)      95.8    123.6   (22.5%)
 Annualised Premium Equivalent           4.4      6.6      (33.3%)      13.2    17.5    (24.6%)

 

 

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

                        Three months ended             Nine months ended
                        31 March                       31 March
                        2022     2021     %            2022    2021    %
 PVNBP by product type  £m       £m       change       £m      £m      change
 Regular premium        19.1     26.5     (27.9%)      59.7    76.0    (21.4%)
 Single premium         11.8     20.8     (43.3%)      36.1    47.6    (24.2%)
 Total                  30.9     47.3     (34.7%)      95.8    123.6   (22.5%)

 

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

                             Three months ended             Nine months ended
                             31 March                       31 March
                             2022     2021     %            2022    2021    %
 PVNBP by geographical area  £m       £m       change       £m      £m      change
 Middle East and Africa      12.5     20.6     (39.3%)      35.0    49.2    (28.9%)
 Rest of World               7.9      12.1     (34.7%)      28.5    36.4    (21.7%)
 Latin America               6.3      10.1     (37.6%)      20.7    28.7    (27.9%)
 Far East                    4.2      4.5      (6.7%)       11.6    9.3     24.7%
 Total                       30.9     47.3     (34.7%)      95.8    123.6   (22.5%)

 

 

 

 

The overall environment remained challenging for investment and long-term
savings plans, with new business down 34.7% from Q3 2021.  Regular premium
new business fell 27.9%, with single premiums falling 43.3%.

The general experience across each region saw a reduction both in the number
of cases sold and in the quantity of high-value cases sold.  New business in
Latin America has been additionally impacted this year by a tightening of our
business acceptance criteria in parts of the region to better control the
quality of new business submissions.

The exception to the above was our Far East region which has continued to show
recovery on a year-to-date basis from 2021.

In addition to the various initiatives mentioned in our previous quarterly
update, we have recently recruited two senior additions to our sales team: a
Head of Sales and a Head of New Business Development, to help develop and grow
future new business levels.

The Head of Sales has taken oversight of our global broker-channel sales team
and is tasked to deliver a number of our key distribution and relationship
initiatives, enhancing our overall broker proposition.

The Head of New Business Development is tasked with developing business
relationships with new distributors and further invigorating relationships
with current distributors.

The expanded sales team will continue with the initiatives mentioned in our
previous quarterly update and will drive a number of new initiatives to
increase new business in the coming year and beyond.  This includes the
development and launch of new products for key target markets, updates and
improvements to existing products and the recruitment of additional localised
sales colleagues into key growth regions.

 

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 2022 AuA decreased by £59.1m or 4.8%, reflecting a pull-back in
global stock markets and significantly lower single premium inflows. For the 9
months ended 31 March 2022, AuA decreased £52.5m or 4.3%.

 

 

 

 

 

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

 

                                                      Three months ended                      Nine months ended
                                                                 31 March                                31 March
                                                      2022             2021                   2022             2021
                                                      £m               £m                     £m               £m
 Deposits to investment contracts - regular premiums  21.6             21.0                   64.9             63.3
 Deposits to investment contracts - single premiums   11.6             21.0                   36.2             47.7
 Withdrawals from contracts and charges               (38.3)           (38.4)                 (122.0)          (116.6)
 Effect of market and currency movements              (54.0)                 10.5             (31.6)                  106.2
 (Decrease) / increase in period                      (59.1)                  14.1            (52.5)                  100.6
 Opening balance                                      1,230.8          1,167.0                1,224.2          1,080.5
 Assets under Administration at 31 December           1,171.7          1,181.1                1,171.7          1,181.1

 

 

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

                                                 Nine months ended
                                                  31 March
                                              2022          2021
                                              £m            £m
 Hansard International                        (40.2)        104.3
 Hansard Europe                               (12.3)        (3.7)
 (Decrease) / increase in period              (52.5)        100.6

 

 

Results for the year ENDing 30 JUNE 2022

New business results for the full year are scheduled to be announced on 21
July 2022. Trading results for the full year are expected to be announced on
22 September 2022.

OUTLOOK

The external global environment and the ability for our Independent Financial
Advisor ("IFA") distribution network to grow new long-term savings business
continues to be challenging as Covid-19 related restrictions and their
aftermath and economic confidence fluctuate.  We therefore expect IFA sales
for FY 2022 to be lower than FY 2021 but note that will not have a material
impact to our profit under International Financial Reporting Standards
("IFRS") in the short term.  This is because initial income and origination
costs are deferred at point of sale and recognised over the lifetime of
contracts sold.

We remain confident that our Japanese product will produce long-term business
growth for the Group. We continue to work with our local distribution partner
towards a suitable launch date, although the timing remains subject to factors
not within our control, notably an improvement in the Covid-19 restrictions
currently in place in Japan.

 

 

 

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

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTUPUPAAUPPGCC