JRP Group PLC BUSINESS UPDATE FOR THE PERIOD ENDED 31 DEC 2016 (8064V)
February 02 2017 - 2:00AM
UK Regulatory
TIDMJRP
RNS Number : 8064V
JRP Group PLC
02 February 2017
NEWS RELEASE www.jrpgroup.com
2 February 2017
JRP GROUP PLC
BUSINESS UPDATE FOR THE PERIOD ENDED 31 DECEMBER 2016
FOCUS ON MARGIN EXPANSION, CAPITAL DISCIPLINE & MERGER
PROGRESS
JRP Group plc ("JRP", "the Group") announces a business update
for the period ended 31 December 2016.
Highlights
* Our core focus on pricing discipline has meant that
our IFRS new business margin for 2016 should exceed
previous guidance and is now likely to exceed 6%
(2015 pro forma - 3.6%). This expansion has been
helped by pricing and risk selection, as well as
attractive mortgage yields.
* Pro forma sales (as if the merger had taken place on
1/1/15) were up 2% for Guaranteed Income for Life
(GIfL), confirming the stabilisation of this market
post pension freedom and choice. Our addressable
market is expected to grow in 2017, boosted by growth
in the open market.
* Pro forma DB De-risking (DB) sales were 24% lower, as
fully expected, given the exceptionally high sales in
the second half of 2015 ahead of the introduction of
Solvency II. However, the underlying growth rate is
better indicated by pro forma DB sales in 2016 which
were up 37% compared to pro forma 2014 sales. Future
growth prospects remain very positive for the
segment.
* Pro forma Lifetime Mortgage (LTM) advances fell by 6%
(reflecting the lower DB sales), but at 32% of GIfL
and DB sales were ahead of our 25% target.
* Run rate merger cost synergies of GBP30m p.a. were
achieved, out of the GBP45m targeted by end 2018.
This is well ahead of schedule, and will contribute
to profit margins in 2017.
12 months 12 months
JRP pro forma new business to to Change
31/12/16 31/12/15
GBPm GBPm %
Defined Benefit De-risking 943 1,233 (24)
Guaranteed Income for
Life 778 763 2
Care Plans 97 92 5
========== ========== =======
Retirement Income sales 1,819 2,088 (13)
Drawdown 25 21 22
========== ========== =======
Total Retirement sales 1,844 2,109 (13)
Protection 5 5 (7)
Lifetime mortgage loans
advanced 559 598 (6)
========== ========== =======
Total new business sales 2,408 2,712 (11)
========== ========== =======
Rodney Cook, Group Chief Executive, said:
"The transformation of our business since the merger is more
than delivering the expected benefits. We have adapted the business
rapidly in 2016 to the new regulatory environment. This will
continue into 2017, with our primary focus on growing earnings by
using our combined IP for better risk selection and by driving down
costs.
Our DB pipeline continues to grow, and we are progressing
transactions at all stages of the sales process with a number of
major Employee Benefit Consultants.
The GIfL market is continuing to stabilise, and we remain
confident that, following further regulatory intervention by the
Financial Conduct Authority, more GIfL customers will shop around,
rather than just taking their pension saving company's in-house
offering. This means our addressable market for GIfL should
increase, and several pension companies are creating GIfL panels on
which we expect to feature.
We took full advantage of favourable economic conditions in the
first 9 months of the year for Lifetime Mortgages and then
intentionally managed back sales in the final quarter. The LTM
market grew by more than 30% in 2016, and it remains attractive
with favourable underlying dynamics.
I would like to thank colleagues across the Group for
maintaining our excellent customer service during a challenging
merger process. The rapid progress achieved to date, including our
ahead of schedule delivery of cost savings, confirms the benefits
we saw in recommending the merger to shareholders in 2015."
18 months 18 months
JRP Statutory to to Change
31/12/16 31/12/15
GBPm GBPm %
Defined Benefit De-risking 1,645 1,310 26
Guaranteed Income for
Life 973 749 30
Care Plans 97 29 240
========== ========== =======
Retirement Income sales 2,715 2,088 30
Drawdown 32 56 (42)
========== ========== =======
Total Retirement sales 2,747 2,144 28
Protection 3 0 n/a
Lifetime mortgage loans
advanced 730 545 34
========== ========== =======
Total new business sales 3,481 2,689 29
========== ========== =======
Notes
1. The merger of Just Retirement and Partnership is required for
accounting purposes to be treated as an acquisition by Just
Retirement of Partnership with an effective date of the beginning
of April 2016. Accordingly the statutory information includes 18
months of Just Retirement and nine months results of Partnership.
Just Retirement Group plc (renamed JRP Group plc) changed its year
end to 31 December and consequently its next statutory reporting
period will be for the 18 months to December 2016. As a consequence
pro-forma sales data as though the merger took place at the
beginning of January 2015 have been presented to give the market an
understanding of the business of the merged Group.
2. Numbers in table subject to rounding.
FINANCIAL CALENDAR DATE
----------------------------------- -----------------
Defined Benefit De-risking seminar 22 February 2017
Preliminary results for the 18 10 March 2017
months ended 31 December 2016
----------------------------------- -----------------
Enquiries
Investors / Analysts Media
James Pearce, Group Director Stephen Lowe, Group Communications
of Corporate Finance and Director
Investor Relations
Telephone: +44 (0) 7715 Telephone: +44 (0) 1737
085 099 827 301
james.pearce@wearejust.co.uk press.office@wearejust.co.uk
Temple Bar Advisory
Alex Child-Villiers
William Barker
Telephone: +44 (0) 20 7002
1080
------------------------------ -------------------------------------
A copy of this announcement will be available on the Group's
website www.jrpgroup.com
JRP GROUP PLC
GROUP COMMUNICATIONS
Vale House, Roebuck Close
Bancroft Road, Reigate
Surrey RH2 7RU
This information is provided by RNS
The company news service from the London Stock Exchange
END
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