Mortgage Advice Bureau Regulatory News (MAB1)

27 January 2022

Mortgage Advice Bureau (Holdings) plc 

("MAB" or the "Group")

Trading Update 

Mortgage Advice Bureau (Holdings) plc (AIM: MAB1) today issues a trading update for the year ended 31 December 2021, ahead of publishing its final results on Tuesday, 29 March 2022.

Despite the regulatory approval of new Appointed Representative firms taking longer than in previous years, the Group increased revenue to circa £188m for the year ended 31 December 2021. This represents a 27% increase on 2020 (£148m) and a 31% increase compared to 2019 (£144m).

The increase in revenue since 2019 is driven by the combination of a 23% increase in the average number of mainstream1 advisers to 1,649 over the two-year period (2019: 1,341) and a 7% increase in revenue per mainstream adviser. At 31 December 2021, total adviser numbers had grown to 1,8852, an increase of 305 (or 19%) for the year (31 December 2020: 1,580).

As anticipated during the second half of the year, housing market activity softened when compared to H1 2021, following the tapering and ultimately the removal of the stamp duty holiday. This was however countered by a strong increase in refinancing activity. The underlying fundamentals driving levels of consumer demand for housing and mortgage products remain strong, though activity has been constrained by the currently lower level of housing stock for sale.

The Group's adjusted profit before tax for the year ended 31 December 2021 is expected to be in line with Board expectations.

1 Excludes directly authorised advisers, later life advisers, and advisers from associates in the process of being onboarded under MAB's AR arrangements

2 Includes a total of 47 advisers at 31 December 2021 who are either directly authorised or later life advisers. The directly authorised advisers are employees of a firm previously authorised under an Appointed Representative agreement with MAB until 7 December 2020. MAB continues to provide services to this firm, which is now directly authorised by the FCA. For both later life and directly authorised advisers the fees received by MAB represent the net income received by MAB as there are no commission payouts made by MAB. Also includes 64 advisers from associates, who are in the process of being onboarded under MAB's AR arrangements. These advisers will shortly become mainstream advisers. Until these 64 advisers become onboarded fully as mainstream advisers, MAB currently only recognises its share of profit after tax from these associates.

Current trading

The Group starts 2022 with a strong pipeline of written business and adviser recruitment, which will be enhanced by delayed adviser starts from 2021. Refinancing activity remains positive, and demand for housing continues to be very strong, with greater activity levels only constrained by the level of housing stock for sale.

Gross new mortgage lending in 2021 was driven by a very strong purchase market, with the Intermediary Mortgage Lenders Association ("IMLA") and UK Finance estimating gross new mortgage lending for 2021 at £304bn and £316bn respectively. IMLA and UK Finance's recent estimates of gross new mortgage lending for 2022 are £275bn and £281bn respectively, representing a reduction versus 2021, with higher levels of refinancing forecast.

Current trading is in line with the Board's expectations. MAB's maturing and new growth drivers put MAB in a strong position to accelerate its pace of growth.

Peter Brodnicki, CEO of MAB, commented:

"I am delighted with MAB's performance and we enter 2022 with a strong and growing pipeline of business, ARs, advisers and lead sources, and expect to have a very strong start to the year in terms of adviser numbers.

"We are delighted with the recent investments we have made which we believe will contribute strongly, along with those that have been maturing in recent years.

"MAB's strategy of not only delivering growth in advisers, but also in adviser productivity driven by further enhancements in our technology platform, lead generation initiatives and our proposition for ARs and their advisers, will drive profitability and supports our plan for accelerated growth."

Enquiries:

Mortgage Advice Bureau (Holdings) plc +44 (0)1332 525007

Peter Brodnicki, Chief Executive Officer

Ben Thompson, Deputy Chief Executive Officer

Lucy Tilley, Chief Financial Officer

Numis Securities Limited

Stephen Westgate / Giles Rolls

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR").