Record Regulatory News (REC)

17 January 2012

RECORD PLC

THIRD QUARTER TRADING UPDATE

Record plc ("Record" or the "Company"), the specialist currency manager, announces today that as at 31st December 2011 the Group's assets under management equivalents ("AuME") totalled $25.4 billion (30th September 2011: $28.9 billion).

AuME expressed in Sterling as at 31st December 2011 totalled £16.4 billion (30th September 2011: £18.6 billion).

1. AuME composition

Record saw an overall decrease in AuME when expressed in both US Dollars and Sterling during the period between 30th September 2011 and 31st December 2011, largely due to the previously announced loss of the second largest Dynamic Hedging mandate and a continuation in outflows from Currency for Return. There has also been a change to a Dynamic Hedging mandate and changes to Currency for Return mandates during the period. The composition of AuME at 31st December 2011 was as follows:

Note 1: This includes $0.8 billion of Emerging Market strategies (30th September 2011 $1.1 billion).

2. AuME MOVEMENT

Net client AuME flows in the three months to 31st December 2011 by product were as follows:

Record had 40 clients at 31st December 2011, compared to 43 clients at 30th September 2011.

The factors other than client flows which impacted AuME during the quarter, totalling $0.8 billion, were:

(i) Movements in global stock and other markets: $1.1bn Substantially all the Passive and Dynamic Hedging, and some of the Currency for Return mandates are linked to stock and other market levels. Consequently AuME is affected by movements in these markets;

(ii) Exchange rate movements: ($0.3bn) Exchange rate movements during the period affect the conversion of non-US Dollar mandate sizes into US Dollar AuME;

(iii) Pooled fund investment performance: $-bn Investment returns are compounded on a geared basis into the AuME of the pooled funds and so impact AuME.

Our Dynamic Hedging programmes performed as expected for US clients during the quarter although the hedge ratios varied significantly in response to movements in exchange rates. The product performed particularly well in November when the US Dollar started strengthening following a period of weakness in October. As the US Dollar strengthened against the Euro and Swiss Franc towards the end of the quarter the hedge ratios increased. In this positioning any further weakness in these currencies will be translated into positive performance going forward.

For the UK based Dynamic Hedging clients, Sterling started the quarter with strong performance especially against the US dollar but declined in value towards the quarter end when measured against a basket of currencies. Overall, the programmes generated value during the period of Sterling strength and passed through approximately half of the foreign currency gains during the period of Sterling weakness.

Investment performance in Record's established active Forward Rate Bias (FRB) product was marginally positive during the quarter ending 31st December 2011 and for an un-geared portfolio equated to a positive return of 0.03% over the quarter (3 months to 30th September 2011: positive return of 0.34%). This compares to a positive return in the quarter of 2.70% for the FTSE Currency FRB10 index (excess return in Sterling). The FRB10 index has outperformed the active FRB product principally because of the index's greater exposure to less liquid currencies and absence of risk management costs.

3. AVERAGE FEE RATES

During the quarter to 31st December 2011, fee rates for all products remained broadly unchanged from the six months ended 30th September 2011.

During the quarter Dynamic Hedging AuME reduced by $2.0 billion. Of this $2.0bn, net client outflows contribute $2.5 billion, including $1.5 billion from the previously announced termination by Record's second largest client and $1.2 billion from Record's largest client restructuring their programme. As previously announced, this client has a tiered fee structure and the reduction in AuME has a significantly lower impact on income than the average Dynamic Hedging fee rate would imply.

4. CHIEF EXECUTIVE'S COMMENT

Chief Executive James Wood-Collins, commenting on trading, said "Although the quarter has seen an overall decline in AuME, we continue to believe we are well positioned to secure further hedging mandates in the current financial year. The decline in AuME is largely due to two events in Dynamic Hedging - namely the previously announced loss of a large client, and our largest client amending their programme with a relatively modest impact on income - and to Currency for Return products, principally active FRB, continuing to see client outflows.

"By contrast, we have seen a number of enquiries and RFPs for Passive Hedging in Continental Europe, in particular Switzerland, and for Dynamic Hedging in the UK. We are optimistic about our prospects with these opportunities and we have been awarded, but not yet started, Passive Hedging mandates including one for CHF1.8 billion. In the longer term, we are also confident that the increased attention being paid to currency risk by US investors will create more opportunities for hedging in that market."

Record will announce its fourth quarter trading update on 20th April 2012.

 ENDS

For further information, please contact:

Record plc Tel: +44 (0) 1753 852 222

James Wood-Collins

Paul Sheriff

MHP Tel: +44 (0) 20 3128 8100

Nick Denton

John Olsen

Vicky Watkins

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 Dynamic Hedging and Currency for Return for institutional clients.

The Group has three principal product lines:

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

- Dynamic Hedging, formerly known as Active 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; and

- 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.

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.