Long-term savings provider Hansard is expecting to report that profits for the second half of financial year 2019, “while positive, will be significantly lower” than in the preceding six-month period.
The company’s financial year runs from 1 July to 30 June.
The reasons for the downbeat assessment include the development costs of a new administration system and licensing and development costs for its Japanese proposition.
This was compounded by increased litigation defence costs, lower surrender charge income from contract-holder withdrawals and lower fee income from Hansards Europe, which has been closed to new business since 2013.
Legal costs
The Isle of Man-based company has been bogged down by legal action relating to the legacy operations of Hansard Europe.
Last year, the group reported it had successfully defended nine cases with net exposures of approximately €8.2m (£7.3m, $9.1m), including its largest single case in Belgium.
It said this affirmed confidence in its legal arguments.
Trading update
Hansard reported new business for the year ending 30 June 2019 was £155.9m, up 6.3% from £146.6m last year.
Assets under administration rose “in line with global stock markets”, the company said, reaching £1.08bn in Q4 up from £1.03bn at the end of Q3.
Gordon Marr, group chief executive of Hansard Global, said: “We are delighted to have achieved a 6% growth in sales in the 2019 financial year given the amount of regulatory change taking place in our market.
“While we have incurred a number of costs for the full year to support future growth and improve operational efficiency.
“Our implemented strategy in the UAE is proving a significant success and we look forward to capitalising on our recently announced licence in Japan during the course of the financial year.”
