Wrap Text
Quilter plc interim results for the six months ended 30 June 2019
QUILTER PLC
(previously, Old Mutual Wealth Management Limited)
Incorporated under the Companies Act 1985 with registered number 06404270 and re-registered as a public limited company
under the Companies Act 2006)
ISIN CODE: GB00BDCXV269
JSE SHARE CODE: QLT
Quilter plc (the "Company")
NEWS RELEASE
5 August 2019
Quilter plc interim results for the six months ended 30 June 2019
Quilter plc reports 5% growth in adjusted profit before tax to £115 million and an interim dividend of
1.7 pence per share
Highlights
- Adjusted profit before tax up 5% to £115 million (H1 2018: £110 million), of which:
o £89 million, an increase of 7%, from Quilter excluding Quilter Life Assurance (‘QLA’) (H1 2018: £83 million); and
o £26 million from QLA (H1 2018: £27 million).
- Adjusted diluted earnings per share of 5.5 pence in line with H1 2018, of which:
o 4.1 pence from Quilter excluding QLA (H1 2018: 4.1 pence); and
o 1.4 pence from QLA (H1 2018: 1.4 pence).
- Headline earnings per share of (0.9) pence (H1 2018: £2.8 pence).
- Agreed disposal of QLA, subject to regulatory approval, to ReAssure for consideration of £425 million representing 120% of end 2018 own
funds (after taking into account dividend payments of £130 million made to Quilter during the course of 2019). The Board is currently minded
to undertake a meaningful capital distribution from the net sale proceeds to shareholders with the method of capital return subject to
shareholder consultation. We will update on the amount and method of distribution at the closing of the transaction, expected to be late
2019.
- IFRS loss before tax attributable to equity holders from continuing operations of £40 million (H1 2018: £nil), principally due to the period on
period change in policyholder tax movements.
- Interim dividend of 1.7 pence per share.
- Operating margin stable at 29% including QLA (26% excluding QLA).
- Assets under Management/Administration (‘AuMA’) up 8% from 31 December 2018 to £118.4 billion (FY 2018: £109.3 billion), of which:
o £108.7 billion, an increase of 9%, from Quilter excluding QLA (FY 2018: £99.3 billion); and
o £12.1 billion, a decrease of 2%, from QLA (FY 2018: £12.4 billion).
- Gross sales (excluding QLA) of £6.0 billion (H1 2018: £7.9 billion, H2 2018: £6.3 billion).
- Net Client Cash Flow (‘NCCF’) (excluding QLA) of £0.3 billion (H1 2018: £3.0 billion) with a modest (£0.2 billion) outflow in the second
quarter predominantly attributable to the impact of expected client redemptions in Quilter Cheviot of c.£0.8 billion.
- Integrated flows (excluding QLA) of £1.3 billion (H1 2018: £2.8 billion).
- Solvency II ratio of 181% after payment of interim dividend (FY 2018: 190%).
- UK Platform Transformation Programme is making good progress with final software testing in progress and validation of migration data
integrity nearing completion. Initial migration expected by early 2020 and full programme expected to complete by around this time next
year at an additional cost of approximately £25 million.
- Business optimisation and cost saving initiatives progressing well with £11 million of benefits realised for 2019 providing support to the first
half operating margin.
Paul Feeney, Chief Executive Officer, said:
”Quilter produced a solid set of results for the first half of 2019, as evidenced by growth in adjusted profit before tax with revenues growing modestly
faster than costs and a stable operating margin. We are focussed on making Quilter a simpler, more efficient wealth management business, and the
announcement today of the sale of Quilter Life Assurance is a further significant step forward in this regard.
In addition to the Charles Derby Group acquisition announced in February 2019, I am delighted that we completed the acquisition of Lighthouse plc
in June 2019, consolidating our place as the second largest retail advisory business in the UK. We are on a mission to make advice more valued and
accessible, and want Quilter to be recognised as the best place to go for trusted financial advice in the UK.
We are building a business that is fit for the future. Good progress continues to be made on optimisation and with the UK Platform Transformation
Programme, notwithstanding the additional costs announced today. While we have encountered some short-term delays, we are focussed on ensuring
the programme is implemented to our desired quality and still expect to complete the programme by this time next year.
While the uncertain political environment in the UK evidenced in the latter half of 2018 has continued into 2019, gross new business sales have held
up well at £6.0 billion. We experienced higher outflows in Quilter Cheviot following the resignation of some Investment Managers during 2018 putting
pressure on net flows.
The Board declared an interim dividend of 1.7 pence per share, representing a pay-out ratio of approximately 46% of adjusted profit after tax and
based on an expected one third/two thirds dividend split. This is consistent with the dividend policy outlined at the time of our Listing one year ago.”
Shareholder Information
The Board has declared an interim dividend for 2019 of 1.7 pence per share. The interim dividend will be paid on Friday 20 September 2019 to
shareholders on the UK and South African share registers on Friday 30 August 2019.
Dividend Timetable
Dividend announcement in pounds sterling with South Africa ZAR Equivalent Monday 5 August 2019
Last day to trade cum dividend in South Africa Tuesday 27 August 2019
Shares trade ex-dividend in South Africa Wednesday 28 August 2019
Shares trade ex-dividend in the UK Thursday 29 August 2019
Record Date in UK and South Africa Friday 30 August 2019
Payment date Friday 20 September 2019
From the opening of trading on Monday 5 August 2019 until the close of business on Friday 30 August 2019, no transfers between the London and
Johannesburg registers will be permitted. Share certificates for shareholders on the South African register may not be dematerialised or rematerialised
between Wednesday 28 and Friday 30 August 2019, both dates inclusive.
Additional information
Shareholders who hold shares through the Johannesburg Stock Exchange will receive their dividend (treated as a dividend from a foreign source) in
South African rand. For shareholders on our South African share register a dividend of 30.24071 cents per share will be paid on Friday 20 September
2019, using an exchange rate of 17.78865. Dividend Tax will be withheld at the rate of 20% from the amount of the gross dividend of 30.24071 South
African cents per share paid to shareholders on the South African share register unless a shareholder qualifies for exemption. After the Dividend Tax
has been withheld, the net dividend will be 24.19256 South African cents per share. The Company had a total of 1,902,251,098 shares in issue at
today’s date.
If you are uncertain as to the tax treatment of any dividends you should consult your own tax advisor.
Quilter highlights from continuing operations1 H1 2019 H1 2018
Assets and flows
AuMA (£bn)2 108.7 104.7
Gross sales 6.0 7.9
NCCF (£bn)2 0.3 3.0
NCCF/opening AuMA (annualised) 4 1% 6%
Integrated flows (£bn)2 1.3 2.8
Productivity (£m)3 1.0 1.8
Asset retention5 89% 91%
Profit & loss
IFRS loss before tax attributable to equity holders (£m) (40) -
IFRS (loss)/profit after tax (£m) (32) 2
Adjusted profit before tax (£m)2 89 83
Operating margin2 26% 25%
Revenue margin (bps)2 56 56
Adjusted diluted earnings per share (pence)2 4.1 4.1
Return on equity2 9.2% 14.1%
Non-financial
Restricted Financial Planners ('RFPs') 1,803 1,590
Investment Managers ('IMs') 163 168
Quilter highlights from continuing operations including Quilter Life Assurance H1 2019 H1 2018
Assets and flows
AuMA (£bn)2 118.4 116.5
Gross sales 6.0 8.1
NCCF (£bn)2 (0.9) 2.2
Profit & loss
Adjusted profit before tax (£m)2 115 110
Operating margin2 29% 29%
Revenue margin (bps)2 57 57
Basic earnings per share (pence)2 (0.9) 18.7
Adjusted diluted earnings per share (pence)2 5.5 5.5
Return on equity2 10.2% 14.7%
1 Continuing operations represent Quilter plc excluding results of QLA (for both 2018 and 2019) and the Single Strategy business (up to the date of sale which completed
on 29 June 2018).
2 Alternative Performance Measures ('APMs') are detailed on page 5.
3 Average NCCF per Restricted Financial Planner.
4 NCCF (annualised) as a % of opening AuMA (excluding Quilter Life Assurance).
5 Outflows are calculated on an annualised basis.
This short-form announcement is the responsibility of the directors and is only a summary of the information in the full announcement. Any
investment decisions by investors and/or shareholders should be based on consideration of the full announcement as a whole.
The full announcement can be found on the company’s website at www.quilter.com/investor-relations and
https://senspdf.jse.co.za/documents/2019/JSE/ISSE/QLTE/Quilter.pdf.
Copies of the full announcement may also be requested at the company’s registered office, at no charge, during office hours.
JSE Sponsor: J.P. Morgan Equities South Africa (Pty) Ltd
Date: 05/08/2019 08:02:00
Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
