IFG Group PLC Trading Update (7465L)
July 21 2017 - 4:31AM
UK Regulatory
TIDMIFP
RNS Number : 7465L
IFG Group PLC
21 July 2017
21 July 2017
IFG Group plc (the "Company")
Trading Update
The Company issues the following pre-results update for its half
year up to 30 June 2017:
As disclosed in our Interim Management Statement on the 9(th)
May 2017, both of the businesses, James Hay and Saunderson House,
have seen strong growth in new client activity during 2017 to date,
which has translated into assets under administration and advice
increasing to more than GBP29 billion (H1 2016, GBP24.4
billion).
James Hay has added more than 3,000 clients in H1 2017, which
amounts to a 50% increase compared to the same period in 2016.
Pricing changes have now been implemented in James Hay meaningfully
offsetting the previously announced reduction in interest income
and providing a more stable and predictable revenue stream for
James Hay.
Attrition within James Hay, at 6.2%, is lower than the
equivalent period in 2016 (6.8%). Saunderson House has added 144
clients compared to 126 for the same period for 2016, which was
driven by the faster than anticipated growth in its new
discretionary management offering. In aggregate, we expect both
businesses to deliver an adjusted operating profit in line with
market consensus in 2017 and replace lost interest income with more
stable and predictable fee income, strongly positioning both
businesses to deliver meaningful growth in profitability in
2018.
As previously disclosed, the Group is incurring material legal
and remediation costs in relation to legacy non-standard
investments in which some of James Hay's clients invested,
principally a structured bio-fuels investment known as Elysian
Fuels. We are engaged in on-going discussions with HMRC to clarify
any potential sanction charges but due to the complexity of the
matter, any financial exposure to the Group, which is a function of
any sanction charges offset by recoveries, is unlikely to be
resolved by the time of the announcement of our interim results on
the 30(th) August.
At a Board meeting on the 20(th) July 2017, the Company's Board
approved an acceleration of the restructuring plan for James Hay,
which will deliver improvements to the operational capability of
the business, supporting increased efficiency, reduced on-going
costs and improved service levels to clients.
As a result of the above matters, the level of exceptional costs
that will be incurred in 2017 is expected to increase materially,
which will lead to reduced statutory profits for the Group. We
believe this is the correct course of action to firmly position the
Company to deliver meaningful profit growth in 2018.
John Cotter, IFG Group CEO, commented "It is pleasing that both
businesses are strongly growing clients and assets, reflecting the
quality propositions we offer to our clients. The pricing changes
we have implemented will deliver growth in revenues in H2, and the
acceleration of the restructuring within James Hay reflects our
confidence that the changes will deliver a more efficient, and more
profitable, business going forward. We are focused on resolving the
legacy issues within James Hay, which are distracting from the
strong underlying performance of the businesses."
This trading update contains inside information.
Enquiries:
John Cotter Group Chief Executive Tel: +44 203 887 6181
Andrew Price Group Chief Financial Officer Tel: +44 203 887 6181
This announcement has been issued through the Companies
Announcement Service of
The Irish Stock Exchange
This information is provided by RNS
The company news service from the London Stock Exchange
END
ISEFMGZNRMMGNZG
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