SHRE.L Regulatory News (SHRE)

AIM: SHRE

Share plc

("Share" or "the Company")

Trading Update

&

Agreement to Acquire Book of 8,000 Customer Accounts

Share, which operates The Share Centre Limited, a leading UK independent stockbroker, today provides an update on trading, including its Q3 performance against its peers* and announces an agreement to acquire a book of 8,000 customer accounts.

Trading Update

Share's performance in Q3 was in line with management expectations, with revenues excluding interest increasing by 7% year-on-year, up from the 1% increase for the first half of the year. Assets held on behalf of customers have increased by 34% to £3.6bn year-on-year, reflecting the benefit of acquisitions as well as the continued strength of customer interaction and net account transfers in from other brokers. The rise represented a 6% increase quarter-on-quarter, in line with the FTSE All Share Index over the period.

Share's market share of peer group* revenues (excluding interest) for Q3 was 10.08%. This compared to 10.06% in Q2 and 10.88% in Q3 last year. Including interest, Share's market share in Q3 was 7.72%, compared to 7.87% in Q2 2016 and 8.41% in Q3 last year. An analysis of Share's income streams for Q3 shows:

- Dealing commission (which currently accounts for c.48% of Group revenues) increased by 9% relative to Q3 2015 which for Share in particular was a comparatively strong quarter. This growth was supported by the Barclays Investment Club accounts acquired in February 2016, as well as healthy trading volumes since the EU Referendum Result. The peer group experienced an increase of 14%;

- Fee income (which accounts for c.47% of Group revenues) increased by 6% relative to Q3 2015. The peer group, where fee income collectively only accounts for c.13% of revenues, saw an increase of 29%. The increase in the peer group's fees may be explained by the Retail Distribution Review ("RDR"), which required companies to review their charging structures by April 2016. With trail commission no longer available, the market has shifted towards fee-based and other charges. Fee-based charges are often based on the value of customer holdings and therefore increase or decrease with the value of those holdings, thereby penalising the customer in a rising market as seen in the last quarter. By contrast, The Share Centre has adopted a simple low fixed-rate account administration fee. Whilst this positions The Share Centre very competitively, especially against value-related fee structures and particularly in weak markets, it does not benefit to the same extent in rising markets as the last quarter demonstrates;

- Interest income (which now only accounts for less than 5% of Group revenues) reduced by 35% relative to Q3 2015. Whilst Share's client money balances have increased, not only did the Bank of England reduce interest rates to 0.25% in August but banks for regulatory reasons increasingly show a limited appetite to accept client money deposits. A number of our peers however are part of larger banking entities and so can benefit from higher internal rates on money. We also believe that some of our peers are now using relatively higher risk counterparties than ourselves, where money can be placed at significantly higher interest rates. Reflecting both these factors, interest income for the peer group increased by 5% and continues to exceed its income generated from fees, even in this low interest rate environment.

*Market share data has been independently compiled and measured by ComPeer Limited and benchmarked revenue peer group comprises: Alliance Trust Savings; Barclays Stockbrokers; Equiniti; Halifax Share Dealing; HSBC Stockbrokers; Saga Personal Finance; Selftrade and TD Direct Investing

Acquisition of Accounts

We are pleased to announce an agreement to acquire a book of 8,000 client accounts (predominantly ISAs) containing approximately £200m of assets under administration. The acquisition is expected to complete in April 2017, is in line with the Company's strategy of signing strategic partnerships and a further announcement will be made in due course.

Richard Stone, Chief Executive of Share plc, commented:

"Share's trading performance in the third quarter of the year was in line with management expectations, with revenues excluding interest up by 7% year-on-year and assets up by 34% year-on-year to £3.6bn. These encouraging results reflect the benefits of the acquisitions we have made as well as net account transfers-in from other brokers.

We are also delighted to announce that we have reached terms to acquire a book of 8,000 active accounts and will be providing further information on this acquisition in due course. This new agreement highlights our high quality customer service and compelling flat-fee pricing proposition. The Share Centre remains a compelling home for wealth management businesses looking to find a suitable provider of execution-only services or looking to exit the execution-only element of their operations."

About Share plc:

Share plc is the parent holding company of The Share Centre Limited and Sharefunds Limited and its shares are traded on AIM. The Share Centre started trading in 1991 and provides a range of account-based services to enable investors to share in the wealth of the stock market. Retail services include share accounts, ISAs, Junior ISAs and SIPPs, all with the benefit of investment advice, and dealing in a wide range of investments. Services available to corporate clients include Enterprise Investment Scheme administration and 'white-label' dealing platforms.

For more details contact 0800 800 008, or visit www.shareplc.com or www.share.com

Risk Warning

This document is not intended to constitute an offer or agreement to buy or sell investments and does not constitute a personal recommendation. The investments and services referred to in this document may not be suitable for every investor and if in doubt independent financial advice should be sought. No liability is accepted whatsoever for any loss howsoever arising from any information in this document subject to the rules of the Financial Conduct Authority or the Financial Services and Markets Act 2000. Share prices, values and income can go down as well as up and investors may get back less than their initial investment. The Share Centre is a member of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority under reference 146768. Sharefunds is authorised and regulated by the Financial Conduct Authority under reference 227807.