Xps Pensions Regulatory News (XPS)

17 October 2023

XPS Pensions Group plc

Post-close trading update

XPS Pensions Group plc ("XPS" or the "Group") is pleased to provide its post-close trading update (unaudited) for the six months ended 30 September 2023 ahead of its interim results expected to be released on 23 November.

Trading update

The strong trading momentum from H2 last year has continued in the six months ended 30 September 2023 and Group revenues have grown 23% year on year to £94.5 million (HY 23: £77.0 million), 19% organically.

Strong demand across all our services, new clients, and the inflation-linkage of our contracts across the business has contributed to the growth.

Advisory revenues grew 28% year on year (23% organic) comprising Pensions Actuarial & Consulting growth of 29% year on year (22% organic) and 26% year on year growth in our Pensions Investment Consulting business. The growth reflects continued high levels of client activity, driven in part by continued regulatory changes and demand for advice in response to volatility in financial markets and changes in pension scheme funding levels. Our clients continue to seek lots of support as they update their long-term strategies in response to rising long term interest rates and the changed inflationary environment, both of which can have profound impacts on pension scheme assets and liabilities.

Pensions Administration revenues grew 16% year on year driven by new client wins coming on stream as well as strong demand for project work. The outlook for Pensions Administration is strong with significant project work with public sector clients stemming from regulatory changes as well as continued success in the first-time outsourcing market.

Across all of our Pensions businesses we have been targeting new business activity in enlisting insurance companies as clients. There has been some immediate success and we will continue to focus on this market.

SIP revenues grew 23% year on year; driven by strong underlying sales and the impact of the increase in the bank base rate. The National Pensions Trust (NPT) business has seen AUM at 30 September 2023 increase 7% to over £1.5 billion since 31 March 2023. Revenues were flat year on year impacted by competitive price pressures. We announced the sale of the NPT business to SEI in July 2023 pending regulatory approvals. We continue to have positive engagement with The Pensions Regulator and currently expect to complete the sale by end of the calendar year.

The Group has continued to invest as anticipated in people and technology to support future growth whilst continuing to deliver operational gearing. The Board is pleased with the Group's performance in the first half of the year and, notwithstanding a tougher comparative period in H2, is confident of achieving full year results ahead of its previous expectations.

Paul Cuff, Co-CEO commented:

"We are pleased to confirm continued strong performance across all our lines of business, sustaining the momentum we have built in recent years. We have been building the breadth and depth of our capability for some time now, and this has enabled us to provide excellent support to our clients in all the varied areas where they need support. I continue to be immensely proud of our people who have continued to look after our clients and each other very well, and I would like to thank all of them for their dedication."

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Notes to Editors:

XPS Pensions Group is a leading independent pension consulting and administration business focussed on UK pension schemes. XPS combines expertise, insight and technology to address the needs of over 1,500 pension schemes and their sponsoring employers on an ongoing and project basis. We undertake pensions administration for over one million members and provide advisory services to schemes and corporate sponsors in respect of schemes of all sizes, including 81 with assets over £1bn.