CURTIS BANKS GROUP PLC-Final Results

CURTIS BANKS GROUP PLC-Final Results

Final Results for the 12 Months to 31 December 2022

Curtis Banks (AIM: CBP), one of the UK's leading SIPP providers, announces its final results for the 12 months to 31 December 2022.

Financial Highlights

·      Group revenue increased by 7.6% to £68.1m (2021: £63.3m)

·      Pension administration fee income steadied at £45.3m (2021: £45.1m)

·      Interest income associated with pension administration increased to £15.1m (2021: £8.3m)

·      FinTech revenue decreased to £7.7m (2021: £9.9m)

·      Group adjusted operating margin1 of 24.1% (2021: 23.5%1)

·      Pension administration adjusted operating margin of 25.5% (2021: 23.9%)

·      FinTech adjusted operating margin of 15.4% (2021: 21.9%), reflecting one-off lower key client activity

·      Adjusted profit before tax1 increased by 10.0% to £15.4m (2021: £14.0m1)

·      Loss before tax of £3.7m (2021: Profit before tax of £9.3m), impacted by a £11.5m goodwill impairment charge relating to Dunstan Thomas

·      Adjusted diluted EPS1 increased to 18.7p (2021: 16.9p1)

Operational Highlights

·      Total Full and Mid SIPPs increased to 56,929 (2021: 55,971), reflecting continued positive product range appeal

·      Net growth in Full and Mid SIPPs of 1.7% (2021: 1.8%)

·      Gross organic growth in Full and Mid SIPP plan numbers of 6.4% (2021: 7.9%)

·      Attrition rate on Full and Mid SIPPs reduced to 4.7% (2021: 6.1%) reflecting initiatives taken by management to improve service levels across the Group

·      Assets under Administration ("AuA") decreased by 4.3% to £35.8bn (2021: £37.4bn) due to external market movements

Post-period Highlights

·      On 6 January 2023, the boards of Curtis Banks Group PLC, and Nucleus Clyde Acquisition Limited ('Bidco'), a wholly-owned subsidiary of Nucleus Financial Platforms Limited ('Nucleus'), announced that they have reached agreement on the terms of a recommended cash offer by Bidco to acquire the entire issued share capital of Curtis Banks for 350 pence per share

·      On 27 February 2023, Curtis Banks's shareholders voted in favour of the proposed acquisition. Both parties are progressing the relevant regulatory and court approval processes and the acquisition is expected to complete, subject to these approvals, in the summer of 2023

·      The transaction - which is expected to complete in the coming months - will create a leading financial planning and retirement-focused adviser platform in the UK, with combined Assets Under Administration of c.£80bn

Key Performance Indicators

Year ended 31 December 2022

Year ended 31 December 2021

Financial

Revenue

£68.1m

£63.3m

Adjusted profit before tax1

£15.4m

£14.0m

(Loss) / Profit before tax

£(3.7m)

£9.3m

Adjusted operating margin1

24.1%

23.5%

Diluted EPS

(10.1p)

11.5p

Adjusted diluted EPS1

18.7p

16.9p

Operational Highlights

Number of Full and Mid SIPPs Administered

56,929

55,971

Assets under Administration

£35.8bn

£37.4bn

Total organic new Full & Mid SIPPs

3,602

4,329

Gross organic growth in Full & Mid SIPPs

6.4%

7.9%

Attrition rate on Full & Mid SIPPs

4.7%

6.1%

Number of properties administered

8,890

9,065

1 In addition to statutory IFRS performance measures, the Group has presented a number of non-statutory alternative performance measures ("APMs"). The Board believes that the APMs used give a more representative view of the underlying performance of the Group and enhance comparability of information between reporting periods. APMs are identified in the definitions at the end of this announcement.

David Barral, Non-Executive Chairman of Curtis Banks, commented:

"These are resilient results that demonstrate the strength of Curtis Banks' business model against a volatile market backdrop. The Group increased the size of its core SIPP book, added new adviser relationships and recorded good growth in revenue and underlying profitability.

"The modest growth in the core Full and Mid SIPP business was supported by a pleasing reduction in customer attrition, reflecting the measures taken to improve service levels across the business. In addition, the Group benefitted from the tailwind of interest income, which nearly doubled to £15.1 million, and our fixed-fee, inflation-linked pricing model, which continued to protect the business from macroeconomic pressures. The FinTech business continued to face commercial challenges in 2022, as outlined in the interim results, however the current year has started well and we remain optimistic over its medium-term prospects.   

"The Board recognises the strategic value of being part of a larger group with enhanced scale and efficiencies. The proposed acquisition by Nucleus, which received shareholder approval in February, is an opportunity for Curtis Banks to be part of a leading retirement-focused adviser platform with approximately £80 billion of assets under administration. It will see us expand our offering, leverage the strengths of the combined Group, and deliver enhanced value to our advisers, customers and shareholders."

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