Record Regulatory News (REC)

RECORD PLCTHIRD QUARTER TRADING UPDATE

Record plc ("Record" or "the Company"), the specialist currency manager, announces today that the Group's assets under management equivalents ("AUME") as at 31st December 2016 totalled $56.6 billion (30th September 2016: $55.0 billion).

AUME expressed in sterling as at 31st December 2016 totalled £45.8 billion (30th September 2016: £42.4 billion).

1. AUME composition

AUME expressed in US dollars increased by 2.9% between 30th September 2016 and 31st December 2016 and increased by 8.0% when expressed in sterling. The composition of AUME by product was as follows:

2. AUME Movement

Net client AUME flows in the three months to 31st December 2016 by product were as follows:

Record had 64 clients at 31st December 2016 (30th September 2016: 61 clients). Since the end of the quarter, notice has been served to terminate mandates in respect of six associated Passive Hedging clients representing $0.7 billion AUME with effect from 30th January 2017, and also in respect of one Dynamic Hedging client representing $0.3 billion AUME, with timing to be determined.

Other than client flows, the factors which have had an aggregate impact on AUME during the quarter of -$0.6 billion, were as follows:

(i) Exchange rate movements: -$2.4bnExchange rate movements during the period affect the conversion of non-US dollar mandate sizes into US dollar AUME.

(ii) Movements in global stock and other markets: +$1.8bn Substantially all the Passive and Dynamic Hedging, and some of the Currency for Return and Multi-Product mandates, are linked to stock and other market levels. Consequently AUME may be affected by movements in these markets.

3. Investment performance

For US Dynamic Hedging clients during the quarter, hedging returns in the programmes were positive, as the US dollar strengthened against the weighted basket of the respective hedged currencies. The largest gain came from hedging the Japanese yen, as hedge ratios rose materially from a low starting point in line with substantial yen weakness. Gains also came from hedging the euro, where hedge ratios increased systematically in line with the broad US dollar strengthening over the quarter.

For UK-based Dynamic Hedging clients the programmes performed as expected, controlling hedging losses in response to sterling weakness against the weighted basket of currencies. Negative returns came primarily from hedging the US dollar, however, losses were limited as the hedge ratios began the period close to zero during sterling's decline in October and then rose and fell accordingly to reflect sterling strength and weakness in November and December, respectively.

Investment performance of the FTSE Currency FRB10 index (excess return in sterling) during the three months to 31st December 2016 was +1.96% (three months to 30th September 2016: return of +1.37%). The FTSE FRB10 Index Fund continued to track the index closely, on a 1.8x geared basis.

Record's Emerging Market product investment performance was positive during the quarter and for an un-geared portfolio equated to a quarterly return of +4.02% (three months to 30th September 2016: return of +2.51%). Annualised performance since inception (30th November 2009) for an un-geared portfolio was +1.89% p.a.

Investment performance in the Multi-Strategy product that comprises the FTSE Currency FRB10, Emerging Market, Value and Momentum strategies was positive during the quarter as positive returns from the FRB10 and Emerging Market strategies more than offset losses from the Momentum and Value components. For an un-geared portfolio, the return was 1.11% over the quarter (three months to 30th September 2016: return of 1.35%). Annualised performance since inception (31st July 2012) for Record's longest-standing Multi-Strategy mandate on an un-geared portfolio basis is +1.76% p.a.

4. AVERAGE FEE RATES, PERFORMANCE FEES AND PRODUCT DEVELOPMENT

During the quarter to 31st December 2016, fee rates for all products remained broadly unchanged from the previous quarter. No performance fees were earned in the quarter.

5. CHIEF EXECUTIVE'S COMMENT

Chief Executive James Wood-Collins, commenting on business development, said:

"US dollar strength dominated the second half of the quarter following the seemingly-unexpected result of the US presidential election in early November, with President-elect Trump's economic ambitions being seen as supportive of the dollar.

"The more divergent paths now appearing between the policies of major Central Banks was underlined by the Federal Reserve's decision to raise the base rate by 0.25% in December, contrasting with the ECB decision in December to extend the QE programme and by the Bank of England's decision to reduce the base rate in the preceding quarter.

"The recent referendum result in Italy, plus forthcoming elections in the Netherlands, France and later in 2017 Germany, continue to remind investors of the ongoing event risk in foreign exchange markets.

"Against this backdrop, it's pleasing to report flows into multi-product and hedging products during the quarter. Such volatility and uncertainty in markets continues to provide opportunities for Record to discuss both its return-seeking and risk-reducing products with current and potential clients."

Record will announce its fourth quarter trading update on 21st April 2017.

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Notes to Editors

Record plc

Record is a specialist currency manager and provider of currency hedging services for institutional clients. Founded in 1983, Record has established a market leading position as a currency manager. Specifically, the Group has a leading position in managing Currency Hedging and Currency for Return for institutional clients.

The Group has four principal reporting lines:

- Dynamic Hedging, where Record seeks to eliminate the impact of currency movements on elements of clients' investment portfolios that are denominated in foreign currencies when these movements are expected to result in an economic loss to the client, but not to do so when they are expected to result in an economic gain;

- Passive Hedging, where Record seeks to eliminate fully or partially the economic impact of currency movements on elements of clients' investment portfolios that are denominated in foreign currencies;

- Currency for Return, in which Record enters into currency contracts for clients with the objective of generating positive returns; and

- Multi-Product, where the client mandate includes combined hedging and return-seeking objectives.

Record (LSE: REC) was admitted to trading on the London Stock Exchange on 3rd December 2007.

This announcement includes information with respect to Record's financial condition, its results of operations and business, strategy, plans and objectives. All statements in this document, other than statements of historical fact, including words such as "anticipates", "expects", "intends", "plans", "believes", "seeks", "estimates", "may", "will", "continue", "project" and similar expressions, are forward-looking statements.

These forward-looking statements are not guarantees of the Company's future performance and are subject to risks, uncertainties and assumptions that could cause the actual future results, performance or achievements of the Company to differ materially from those expressed in or implied by such forward-looking statements.

The forward-looking statements contained in this document are based on numerous assumptions regarding Record's present and future business and strategy and speak only as at the date of this announcement.

The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained in this announcement whether as a result of new information, future events or otherwise.