REG - TT Electronics PLC - Update on U.K. DB Pension Scheme

TT electronicsAnnouncement

21/11/2022 07:00

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RNS Number : 9746G  TT Electronics PLC  21 November 2022

 

 

 

 

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

 

21 November 2022

 

TT Electronics plc

 

TT fully de-risks UK DB Pension Scheme

 

TT Electronics plc ("TT", "the Group"), a global provider of engineered
electronics for performance critical applications, is pleased to announce that
it has completed a buy-in of all its UK defined benefit pension liabilities
giving an immediate £6 million cash flow benefit.

 

The Trustee of the TT Electronics Pension Scheme (the "Scheme") has purchased
a bulk annuity insurance policy from Legal and General Assurance Society
Limited ("L&G"), covering all liabilities required to pay all future
defined benefit pensions for the Scheme's circa 5,000 members and any eligible
dependants.

 

The purchase of this insurance policy is the successful culmination of
extensive work over the last few years by TT and the Scheme Trustees.  The
insurance policy has been purchased using existing assets held within the
Scheme, without the need for TT to make any additional contributions.

 

TT will not be required to make any future contributions into the Scheme
regarding defined benefit liabilities and the buy-in delivers greater security
to the Scheme's members. The Scheme's circa £400 million of liabilities are
now matched by the insurance policy, and TT no longer bears any investment,
longevity, interest rate or inflation risk in respect of the Scheme.

 

There will be an immediate benefit to the Group's current year cash flow of
£6 million and an equivalent annual improvement to free cash flow in future
years.

 

The pension benefits that Scheme members will receive in the future are almost
entirely unaffected by this transaction.

 

 

Mark Hoad, TT Chief Financial Officer commented:

 

"This transaction is an excellent outcome for our defined benefit pension
scheme members, TT and our shareholders. We have worked hand in hand with the
Scheme's Trustee over the last few years to reach this position. Those
efforts, combined with excellent stewardship by the Scheme's Trustee
Directors, has meant that the Scheme can now be fully de-risked for the
benefit of members and the Group.

 

Importantly, the successful execution of this transaction means there will be
a significant increase in TT's annual free cash flow."

 

 

 For further information please contact:

 TT Electronics plc                       Tel: +44 (0)1932 827 779
 Richard Tyson, Chief Executive Officer

 Mark Hoad, Chief Financial Officer

 Kate Moy, Head of Investor Relations and Communications

 MHP                                      Tel: +44 (0)20 3128 8100
 Tim Rowntree / Ollie Hoare

 

Notes:

 

1.   Established in 1836, Legal & General is one of the UK's leading
financial services groups and a major global investor, with over £1.4
trillion in total assets under management of which a third is international.

 

 

About TT Electronics

TT Electronics is a global provider of engineered electronics for performance
critical applications.

TT solves technology challenges for a sustainable world. TT benefits from
enduring megatrends in structurally high-growth markets including healthcare,
aerospace, defence, automation and electrification. TT invests in R&D to
create designed-in products where reliability is mission critical. Products
designed and manufactured include sensors, power management and connectivity
solutions. TT has design and manufacturing facilities in the UK, North
America, Sweden and Asia.

Cautionary statement

This update contains forward-looking statements. These have been made by the
directors in good faith based on the information available to them up to the
time of their approval of this update. The directors can give no assurance
that these expectations will prove to have been correct. Due to the inherent
uncertainties, including both economic and business risk factors underlying
such forward-looking information, actual results may differ materially from
those expressed or implied by these forward-looking statements. The directors
undertake no obligation to update any forward-looking statements whether as a
result of new information, future events or otherwise.

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