European Wealth : Unaudited Interim Results

("European Wealth", or "the Group")

The directors of European Wealth (AIM: EWG, EWGL), the growing wealth management group, are pleased to announce its unaudited interim results for the 6 month period to 30 June 2016.

• Group funds under management ("FUM") increased by 29.6% over the last 12 months to £1.4 billion (30 June 2015: £1.08 billion)

• Three acquisitions made in second half of 2015 fully integrated

• Board restructured in August 2016

• Recurring revenue increased to 62% of turnover (30 June 2015: 57%)

• Review of charging structures in trading companies completed and new fee schedules introduced

• Board's focus remains on growing the Group through acquisition, organic growth and attracting revenue-generating staff

  Group Financial Highlights

• Group revenue for period up 12.8% to £4.4 million (H1 2015: £3.9 million)

• Positive EBITDA achieved of £0.02 million (H1 2015: £0.03 million)

• Group loss before tax for period: £0.5 million (H1 2015: £0.4 million loss)

" The first half of the current year has seen an improvement in the trading performance of the Group due to the integration of the three acquisitions completed in the second half of last year together with the benefit of a reduction in the ongoing cost base of the Group. We expect the Group to continue to improve the underlying trading performance into the second half of the year. Any growth in the funds under management will have an impact on the financial performance of the Group."

A copy of the unaudited interim accounts is available for download from the Company's website,http://www.europeanwealth.com.

The first six months of 2016 has been a period of consolidation and stabilisation for the Group after the three acquisitions made in the second half of 2015. During this period we are pleased to announce a significant improvement in the trading performance of the Group. This is as a result of a further increase in the Group's funds under management, cost savings and the full integration of the acquisitions completed over the last 12 months. These factors combined have resulted in the Group announcing an EBITDA positive figure for the 6 months to 30 June 2016 of £0.02 million compared to a £0.79 million EBITDA loss recorded for the year to 31 December 2015.

In addition, over the last six months both trading divisions have undertaken a thorough review of the various charging structures which has also contributed to an increase in profitability across the Group.

Group funds under management/ influence have increased over the last six months from £1.2 billion as at the 31 December 2015 to £1.4 billion as at 30 June 2016, representing an increase of 16.7% over the last six months and an increase of 29.6% since 30 June 2015.

The net current liability position of the Group remains a matter of consideration for the Board. As noted in the 2015 annual report and accounts, a material percentage of this position relates to non operating costs. The Group still has several options in terms of re-financing that if required will assist in covering these costs.

A significant amount of work has also been undertaken in examining the Group cost base following the acquisitions during 2015. As with any growing company, it is important to ensure our capital and cash flow is invested into areas of the business that are showing the strongest levels of growth. Over the last six months the Management team have identified and made annualised cost savings of over

£750,000. These savings will fully benefit the Group over the next 12 months and are not expected to impact on the Group's ability to continue to pursue the defined growth strategy of the Group.

For the six months to 30 June 2016, the Group reported total revenue of £4.4 million which represents a 12.8% increase on the £3.9 million recorded in the period to 30 June 2015.

The reported loss before tax is £0.5 million for the six months to 30 June 2016 compared to a loss of

£0.40 million for the six months to 30 June 2015. This increased loss is primarily as a result of higher amortisation and finance costs.

Since the reverse acquisition, we have been focusing on a number of key performance indicators that the Board believe are good benchmarks by which to measure the performance of the Group. One of these key measures was the EBITDA performance and I am pleased to report that the Group has once again reached its target of having a positive EBITDA figure at this six month stage.

European Wealth Group has established two key divisions which allow the Group to offer a wide range of services within the wealth management industry.

We have continued to see good growth in the funds under management, which in our investment management business, European Investment Management Limited ("EIM") have reached £889 million (30 June 2015: £751 million), an increase of 18.4%. Unlike the second half of 2015, the funds under management within EIM have not been boosted by acquisition and have been achieved through organic growth.

Whilst EIM has continued to see a gradual increase in the funds under management as a result of the investment made in the previous 18 months into increasing the number of client facing staff, the most pleasing aspect is the success within our institutional fixed interest team. During the first six months of the current year, they have significantly increased their funds under management. Whilst the margins achievable managing fixed interest investments are more modest than those on discretionary equity portfolios, the fixed interest team continue to provide a good alternative stream of income to the Group. Your Board remains optimistic as to the flow of new funds under management that can be expected within the investment management division over the remainder of the current year.

The revenue generated by the investment management division reached £2.67 million (30 June 2015:

£2.29 million) an increase of 17%. Of this revenue, £1.39 million or 52% (H1 2015: £1.28 million or 56%) relates to investment management fees or other types of recurring income. The non-recurring revenue is predominantly brokerage fees generated by European Wealth Trading Limited ("EWT"), which is our broking business that is a member of the London Stock Exchange. As commented in my report last year, your Board's aim is to increase the amount of recurring revenue as a proportion of the total revenue both for the investment management business and also the financial planning business.

In my report last year, I commented on the investment we had made in our back office and administration functions which, inevitably, had an impact on the short term profitability of the Group. It is pleasing to report that the investment management back office function have been able to cope with the increased volumes over the last six months without a significant increase in the cost base.

At the heart of any wealth management business has to be the determination to provide superior investment returns to our clients. I am pleased to report that EIM has continued to win industry awards for investment performance including Best Boutique Wealth Manager in the 2016 Acquisition International Finance Awards.

Our success within the institutional fixed interest space has encouraged your Board to develop an institutional equity offering which is planned to be launched towards the end of the current year. This will build on the investment management expertise in both the UK and Switzerland.

The financial planning business, European Financial Planning Limited ("EFP"), has experienced a challenging first six months. Revenue has reached £1.70 million (H1 2015: £1.52 million), an increase of 11.8%, however, this division has benefited from acquisitions during 2015 which has added £0.46 million to turnover in the six months under review.

Whilst the like for like turnover within the financial planning business is disappointing, your Board is confident that the second half of the year should see a recovery in the revenue figures. The performance in the first 6 months was impacted by a short term reduction in the amount of new business generated by the financial planners whilst new procedures were being introduced and the ISM and Bells acquisitions were being fully integrated within the existing financial planning business.

Your Board is pleased to note that the amount of revenue that is recurring within EFP has increased to

£1.34 million or 79% (H1 2015: £0.98 million or 65%). It is the Board's opinion that for any financial planning business to be successful in the future, it is imperative that the amount of recurring revenue is as high as possible thus providing the cash flow to build an appropriate and robust offering to clients providing an added value service for which the client base is willing to pay ongoing fees.

The acquisition of both ISM and Bells over the last 12 months has played a significant part in increasing the amount of recurring income and demonstrates the underlying quality of the financial planning business that has been established over the last six years.

Both these acquisitions have now been integrated within our existing structure with the ISM team moving into our Head Office in Austin Friars and the financial adviser from Bells being based in our office in Wokingham.

The last six months have been a period of considerable development within the Group and the improved trading performance is expected to continue into the second half of the year.

It is your Board's ambition to continue to build on the amount of revenue that is generated on a recurring basis. The Board believe that the high level of recurring revenue illustrates the quality of the business and the segment of the wealth management industry the Group serves.

There is a noticeable preference amongst new investment management clients to pay an all inclusive fee which may or may not include the provision of financial planning services but emphasises a trend away from the traditional investment management charging structure of a management fee and an additional charge for dealing on the underlying portfolios. This trend is helping your Board in the ambition of increasing the amount of recurring revenue generated by the Group as a whole without losing current revenue.

Our financial planning business has recently announced a revised charging structure which will better align the charges to the clients with the level of service that is appropriate for the client. Once fully implemented, over the next six months, we expect our margins within the financial planning business to improve.

Since the end of the period under review, the Board have announced a reorganisation. Kenneth ('Buzz') West has agreed to become Non-Executive Chairman and I have taken on the role of Group Chief Executive with Simon Ray, the Group Chief Operating Officer, being appointed to the Board. This