STM Group PLC Trading Update (9839I)
November 30 2018 - 2:00AM
UK Regulatory
TIDMSTM
RNS Number : 9839I
STM Group PLC
30 November 2018
STM Group Plc
("STM" or the "Group")
Trading Update
STM Group Plc (AIM: STM), the cross border financial services
provider, announces a trading update on expected performance for
the full year ending 31 December 2018, demonstrating year on year
growth in underlying profit before tax.
As detailed in the Group's interim results to 30 June 2018,
profit before tax for the first six months of the year amounted to
GBP2.1 million, being consistent with the Board's expectations for
the year to 31 December 2018, despite having absorbed GBP0.3
million of professional fees incurred as part of the Skilled
Person's review on the Group's business in Gibraltar completed by
Deloitte in June 2018 and the implementation of the recommendations
from the report.
It is anticipated that in the last quarter of 2018 there will be
a significant release from the London & Colonial Assurance plc
technical long term insurance fund which the Directors currently
anticipate will be at least GBP0.5 million, which will contribute
to the Group's anticipated profit before tax for the year. The
exact amount to be released is currently being calculated by the
Group's appointed actuary. For the year ended 31 December 2017 an
equivalent technical reserve release amounted to GBP1.3 million and
therefore contributed GBP1.3m to the overall profit before tax
result of GBP4.0 million for the year.
During the second half of 2018, the Group's other life company,
STM Life Assurance PCC plc, has incurred a number of one-off costs
in relation to uncollectable policy fees amounting to GBP0.2
million, as well as a policy cancellation and closure exercise for
uneconomical policies amounting to GBP0.1 million. Additionally,
there has been a reduction in the forecasted new business pipeline
to the year end by GBP0.2 million, reflecting a timing delay in
some policies not likely to incept until 2019.
The anticipated release of the technical reserve provides a
significant positive contribution to earnings, as it has done in
previous years. Including this anticipated contribution, the Board
remains confident that the Group will report overall profit before
tax for 2018 in line with its previous expectations, with
underlying profit before tax (excluding the impact of profits from
reserve releases and one off costs) expected to increase year on
year. Trading across all other Group divisions has been in line
with management's expectations.
The Board looks forward to providing a further update once the
technical reserve release from London & Colonial Assurance plc
has been finalised, as part of its pre-close trading statement in
January 2019.
Alan Kentish, Chief Executive Officer of the Company,
commented:
"We are pleased with the underlying trading of the Group for the
year to date, which demonstrates steady growth against our previous
year. The year so far has seen significant change, and it is
apparent that we have experienced a number of material one-off
costs as well as ongoing costs as part of our enhanced governance,
both of which will impact our profitability but make our businesses
more robust. Despite these headwinds, the growth in our underlying
business and the anticipated release of the technical reserve mean
we remain confident of being in line with management's expectations
of overall profit before tax for the full year."
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014.
For further information, please contact:
STM Group Plc
Alan Kentish, Chief Executive Officer Via Walbrook PR
alan.kentish@stmgroupplc.com www.stmgroupplc.com
Therese Neish, Chief Financial Officer
therese.neish@stmgroupplc.com
FinnCap www.finncap.com
Matt Goode / Emily Watts - Corporate Tel: +44 (0) 20 7220 0500
Finance
Tim Redfern / Richard Chambers -
ECM
Walbrook www.walbrookpr.com
Tom Cooper / Paul Vann Tel: +44 (0) 20 7933 8780
Mob: +44 (0) 797 122 1972
tom.cooper@walbrookpr.com
Notes to editors:
STM is a multi jurisdictional financial services group which is
listed on the AIM Market of the London Stock Exchange. The Group
specialises in the delivery of a wide range of financial service
products to professional intermediaries and the administration of
assets for international clients in relation to retirement, estate
and succession planning and wealth structuring.
STM has operations in the UK, Malta, Gibraltar, Jersey, and
Spain. The Group is looking to expand through the development of
additional products and services that its ever more sophisticated
clients demand. STM has developed a specialist international
pensions division which specialises in SIPPs, Qualifying Recognised
Overseas Pension Schemes (QROPS), and Qualifying Non UK Pension
Schemes (QNUPS). STM has a Gibraltar Life Insurance Company, STM
Life plc, which provides life insurance bonds - wrappers in which a
variety of investments, including investment funds, can be
held.
Further information on STM Group can be found at
www.stmgroupplc.com
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 or visit www.rns.com.
END
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