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Quilter plc Fourth Quarter 2019 Trading Statement

29 January 2020

Quilter reports positive trends in Q4 net flows and confirms date of initial platform migration

 

Highlights

  • Assets under Management and Administration (“AuMA”) of £110.4 billion at year-end (+13% from 31 December 2018) with growth supported by positive market movements.
  • Fourth quarter gross sales of £3.5 billion, 17% higher than the prior year period (£3.0 billion).
  • Fourth quarter Net Client Cash Flow inflow (“NCCF”) of £0.5 billion, excluding Heritage Life Assurance (Q4 2018: £0.6 billion).
    • Quilter Cheviot continued to generate year-on-year gross sales momentum, totalling £0.7 billion in the fourth quarter (Q4 2018:
      £0.6 billion). Although the business experienced net outflows of £0.8 billion for the year, reflecting the impact of the previously announced departures of some investment managers, the declining trend in outflows led to a net neutral NCCF out-turn in the fourth quarter.
    • Strong fourth quarter performance from International with gross flows of £0.8 billion (Q4 2018: £0.5 billion).
  • Annual NCCF inflow of £0.3 billion, excluding Heritage Life Assurance, reflected a turnaround from the net outflow of £0.2 billion for the nine months to end-September 2019.
  • 2019 integrated net flows of £2.6 billion continue to demonstrate the robustness of the Quilter business model (2018: £4.7 billion).
  • Platform Transformation Programme update: Initial migration of assets onto the new UK platform is currently planned for the weekend of 22/23 February 2020, with notice given to advisers and customers involved.

 

Quilter plc: Three months ended 31 December 2019

 

 

Quilter plc excl. Heritage Life Assurance (£bn), unaudited

Q4 2019

Q4 2018

Gross sales

3.5

3.0

NCCF

0.5

0.6

Total integrated net flows

0.8

1.0

  of which Quilter Financial Planning generated

0.6

0.8

Defined Benefit to Defined Contribution transfers

0.2

0.3

 

 
Quilter plc: Year ended 31 December 2019

Quilter plc excl. Heritage Life Assurance (£bn), unaudited

2019

2018

Gross sales

12.3

14.2

NCCF

0.3

4.7

NCCF/opening AuMA1

0%

5%

Total integrated net flows

2.6

4.7

   of which Quilter Financial Planning generated

2.6

3.8

 

 

 

Quilter plc excl. Heritage Life Assurance (£bn), unaudited

31 December 2019         

31 December 2018                   

AuMA2

110.4

97.7

1 NCCF as a % of opening AuMA.

2 Following the disposal of Heritage Life Assurance, which completed on 31 December 2019, AuMA includes assets managed and administered on behalf of clients and policyholders only and therefore excludes assets that support shareholder capital and cash requirements. All comparatives have accordingly been restated on this basis.

 

Paul Feeney, CEO of Quilter plc, commented:

“2019 was a good year for market performance but a challenging year for net client flows. We were pleased to finish the year in a positive position. Net inflows of £0.3 billion for the year represented a sharp turnaround from the net outflow of £0.2 billion for the nine months to end-September.

“Looking across our businesses, the integration of our advice acquisitions is progressing well and both Lighthouse and Charles Derby, which this week rebranded to Quilter Financial Advisers, are well positioned to contribute to net flows in 2020. Quilter Cheviot delivered consistently strong gross sales throughout 2019 reflecting the quality of its franchise supported by the contribution from new hires made to strengthen the business. The outflow associated from the investment managers who departed in mid-2018 declined to £0.3 billion in the fourth quarter from £0.6 billion in the third quarter. Our International business, where new business mandates can be sizeable but inherently more irregular, ended the year well with an annual increase of 67% in NCCF.

“Net flows into the UK platform remain subdued ahead of migrating advisers and customers onto our new platform this year. This, in turn, led to more modest flows into Quilter Investors. Stable gross flows in the fourth quarter relative to the prior year demonstrate the strength of our adviser and customer-focussed platform business model. More importantly, we are pleased that the initial migration of customers onto our new platform is currently planned for the weekend of 22/23 February 2020. Our advisers and clients who are involved in this process have been notified accordingly. Our new UK platform will be transformational for Quilter – it has taken time to get to this point and we are excited about the ability to drive further business growth once we have fully migrated onto the new platform by the end of this summer.”

Quilter plc data tables for the three months ended 31 December 2019 (£bn), unaudited

 Q4 gross flows, net flows & AuMA (£bn)¹

AuMA
as at
30 September

2019

Gross  
sales

Gross outflows

Net flows

Market and other movements

AuMA
as at
31 December 2019

 

 

 

 

 

 

 

Quilter Investors

20.2

2.0

(1.9)

0.1

0.5

20.8

Quilter Cheviot

23.8

0.7

(0.7)

-

0.4

24.2

Quilter Financial Planning

0.8

-

-

-

-

0.8

Advice & Wealth Management

44.8

2.7

(2.6)

0.1

0.9

45.8

 

 

 

 

 

 

 

UK platform

55.7

1.6

(1.3)

0.3

1.2

57.2

International

20.2

0.8

(0.5)

0.3

-

20.5

Wealth Platforms

75.9

2.4

(1.8)

0.6

1.2

77.7

 

 

 

 

 

 

 

Elimination of intra-group assets

(12.5)

(1.6)

1.4

(0.2)

(0.4)

(13.1)

 

 

 

 

 

 

 

Quilter plc excl. Heritage Life Assurance

108.2

3.5

(3.0)

0.5

1.7

110.4

Heritage Life Assurance

10.3

-

(1.2)

(1.2)

(9.1)

-

 

 

 

 

 

 

 

 

AuMA
as at
30 September

2018

Gross
sales

Gross outflows

Net flows

Market and other movements

AuMA
as at
31 December 2018

Quilter Investors

18.6

1.1

(0.6)

0.5

(1.4)

17.7

Quilter Cheviot

24.2

0.6

(0.5)

0.1

(2.1)

22.2

Quilter Financial Planning

1.0

-

-

-

(0.2)

0.8

Advice & Wealth Management

43.8

1.7

(1.1)

0.6

(3.7)

40.7

 

 

 

 

 

 

 

UK platform

52.9

1.6

(1.2)

0.4

(3.9)

49.4

International

19.5

0.5

(0.3)

0.2

(1.4)

18.3

Wealth Platforms

72.4

2.1

(1.5)

0.6

(5.3)

67.7

 

 

 

 

 

 

 

Elimination of intra-group assets

(11.0)

(0.8)

0.4

(0.4)

0.7

(10.7)

 

 

 

 

 

 

 

Quilter plc excl. Heritage Life Assurance

105.2

3.0

(2.2)

0.8

(8.3)

97.7

Heritage Life Assurance

12.9

0.2

(1.0)

(0.8)

(0.9)

11.2

1 Following the disposal of Heritage Life Assurance, which completed on 31 December 2019, AuMA includes assets managed and administered on behalf of clients and policyholders only and therefore excludes assets that support shareholder capital and cash requirements. All comparatives have accordingly been restated on this basis

Quilter plc data tables for the twelve months ended 31 December 2019 (£bn), unaudited

 Full year gross flows, net flows & AuMA
 (£bn)¹

AuMA
as at
31 December    2018

Gross 
sales

Gross outflows

Net flows

Market and other movements

AuMA
as at
31 December 2019

 

 

 

 

 

 

 

Quilter Investors

17.7

4.9

(4.4)

0.5

2.6

20.8

Quilter Cheviot

22.2

2.6

(3.4)

(0.8)

2.8

24.2

Quilter Financial Planning

0.8

-

-

-

-

0.8

Advice & Wealth Management

40.7

7.5

(7.8)

(0.3)

5.4

45.8

 

 

 

 

 

 

 

UK platform

49.4

6.0

(5.1)

0.9

6.9

57.2

International

18.3

2.0

(1.5)

0.5

1.7

20.5

Wealth Platforms

67.7

8.0

(6.6)

1.4

8.6

77.4

 

 

 

 

 

 

 

Elimination of intra-group assets

(10.7)

(3.2)

2.4

(0.8)

(1.6)

(13.1)

 

 

 

 

 

 

 

Quilter plc excl. Heritage Life Assurance

97.7

12.3

(12.0)

0.3

12.4

110.4

Heritage Life Assurance

11.2

0.4

(3.9)

(3.5)

(7.7)

-

 

 

 

 

 

 

 

 

AuMA
as at
31 December    2017

Gross   
sales

Gross outflows

Net flows

Market and other movements

AuMA
as at
31 December 2018

Quilter Investors

16.7

5.5

(2.7)

2.8

(1.8)

17.7

Quilter Cheviot

23.5

2.5

(1.8)

0.7

(2.0)

22.2

Quilter Financial Planning

1.1

-

-

-

(0.3)

0.8

Advice & Wealth Management

41.3

8.0

(4.5)

3.5

(4.1)

40.7

 

 

 

 

 

 

 

UK platform

49.6

7.7

(4.6)

3.1

(3.3)

49.4

International

19.2

1.8

(1.5)

0.3

(1.2)

18.3

Wealth Platforms

68.8

9.5

(6.1)

3.4

(4.5)

67.7

 

 

 

 

 

 

 

Elimination of intra-group assets

(9.8)

(3.3)

1.1

(2.2)

1.3

(10.7)

 

 

 

 

 

 

 

Quilter plc excl. Heritage Life Assurance

100.3

14.2

(9.5)

4.7

(7.3)

97.7

Heritage Life Assurance

14.6

0.6

(2.9)

(2.3)

(1.1)

11.2

1 Following the disposal of Heritage Life Assurance, which completed on 31 December 2019, AuMA includes assets managed and administered on behalf of clients and policyholders only and therefore excludes assets that support shareholder capital and cash requirements. All comparatives have accordingly been restated on this basis.

 

 

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