Tavistock Regulatory News (TAVI)

Tavistock Investments Plc

("Tavistock" or the "Company")

Trading Update

9 February 2021

Tavistock Investments Plc, the AIM listed financial services group, is pleased to provide the following trading update for the period ended 31st January 2021.

FINANCIAL PERFORMANCE DURING THE PANDEMIC

The Company's financial performance during the Coronavirus pandemic has been resilient. The primary impact of the pandemic and associated lockdowns has been a reduction in new Advisory business levels, which are influenced by advisers' ability to meet with clients. However, because the Company benefits from a high level of recurring income, the Board currently expects to report gross revenues for the financial year broadly in line with last year.

Prudent management of cost has protected the business and an appropriate structure is now in place to support the Company's future growth. Tavistock has made strong progress with the rationalisation exercise referred to in the Group's interim accounts for the period to 30 September 2020, resulting in the removal of a significant level of cost from the business. Consequently, the Board expects to report EBITDA for the financial year to 31 March 2021, that is significantly ahead of last year.

ACQUISITION OF CLIENTS

The Company has continued to focus on its growth strategy and recently entered into its tenth client acquisition agreement, using its own cash resources to purchase books of business from advisers who are retiring from the industry. These books of business generate recurring income ranging from £25,000 per annum at the low end, to almost £600,000 at the high end. Ownership of client relationships enables the Company to achieve higher margins from the provision of financial advice.

PLATFORM LAUNCH

In December 2020, the Company launched the Tavistock Platform, providing a new low-cost platform service to the Company's advisory and investment clients.

Entry level charging on the Tavistock Platform is 10 bps regardless of portfolio size. Charges reduce to 5bps and, subsequently 2 bps for high value portfolios. The Board believes that this level of pricing is substantially lower than most competing platforms and this initiative emphasises Tavistock's commitment to providing retail clients with extremely cost-effective solutions to their investment needs. Transitioning clients to the Tavistock Platform will enable the Company to service the entire value chain for retail clients. We believe that it will also increase investment in Tavistock's funds and model portfolios.

INVESTMENT PERFORMANCE

Following a change of Chief Investment Officer in July 2020, and the introduction of a revised investment strategy, the performance of the Company's funds and model portfolios has seen many of them consistently ranked in the top quartile of the appropriate IA (Investment Association) sector, the key comparator used by advisers across the industry. By way of example, two of our six flagship ACUMEN funds are ranked 1/173 funds, one 3/155 and another 3/141.

The combination of strong investment performance and low-cost platform has been very well received by Tavistock's clients - and also by advisers from outside the Company.

RECRUITMENT

In the past few months, the Company has been successfully recruiting new advisers from a number of well-known competitors including Sandringham, Quilter/Lighthouse and Succession. There is also a growing pipeline of others wishing to join Tavistock either as Appointed Representative firms or Registered Individuals. These additions are expected to make a material contribution to the Company's financial performance in future years.

INDUSTRY AWARDS

Tavistock has continued to win industry recognition for the high quality of financial advice and investment products that it provides.

Tavistock Wealth, the Company's investment management business, has once again been shortlisted as a finalist for a series of awards over the last year, including being runner-up for the Growth Investor Award as Wealth Manager of the Year and a finalist for the Money Marketing Award as Best Discretionary Fund Manager. Its newest fund, the ACUMEN ESG Protection Portfolio, won the Innovation Award at the 2020 Moneyfacts Investment Life & Pension Awards, beating competition from other much larger nominees.

Similarly, within the Company's advisory business, Tavistock Private Client has recently won prestigious accolades as Boutique IFA of the Year - England and Most Outstanding & Tax Efficient Investing - England.

Brian Raven, Chief Executive, commented: "I am very pleased to update shareholders on so many positive developments, particularly as we approach the end of an extremely challenging financial year. I would like to thank our staff for their dedication and commitment, and I am extremely proud of what we have accomplished together. The Company is now in a strong position to accelerate its growth over the next few years and by so doing, deliver increased value to our shareholders and an enhanced service to our clients."

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