JARDINE LLOYD THOMPSON GROUP 26 FEBRUARY 2019
Jardine Lloyd Thompson Group plc
PRELIMINARY RESULTS statement
FOR THE YEAR ENDED 31 DECEMBER 2018 (UNAUDITED)
Jardine Lloyd Thompson Group plc ('JLT' or the 'Group') announces its preliminary results for the year ended 31 December 2018. Due to the recommended cash offer for JLT by MMC Treasury Holdings (UK) Limited (the 'MMC transaction'), this statement replaces JLT's usual announcement of its preliminary results and provides an update on key financial items in accordance with Listing Rule 9.7A.1. There will not be a presentation to investors and analysts at JLT's office today.
As announced on 7 November 2018, the MMC transaction has been approved by shareholders and is expected to complete in spring 2019, subject to the satisfaction or (where applicable) waiver of the conditions set out in the scheme document published on 15 October 2018 (the 'Scheme Document') (available to view athttps://www.jlt.com/investors/recommended-cash-acquisition-of-jlt). The process of satisfying the anti-trust and regulatory conditions is continuing, with MMC having received clearance from the US anti-trust authority in October 2018.
group Financial Highlights1
• Revenues of £1,451m, up 5%
• Organic2 revenue growth of 5%
•Underlying3 profit before tax of £233.6m, up 25%
• Underlying3 trading margin of 17.5%, up 240bps
•Reported profit before tax of £88.1m, reflecting £145.4m4 of exceptional items consisting principally of MMC transaction-related costs, regulatory-related costs and Global Transformation Programme restructuring charges
•Net Debt5 of £535m (2017: £506m). Net Debt to EBITDA was 1.8:1 on a reported basis, consistent with 2017
12017 figures restated for IFRS 15 Revenue from Contracts with Customers2Organic revenue growth is based on total revenue excluding the effect of currency, acquisitions, disposals and investment income
3Underlying results exclude exceptional items
4 The MMC transaction-related costs have been estimated based on anticipated completion in spring 2019
5Net Debt is defined as own funds less total borrowings net of transaction costs
BUSINESS Highlights
•All divisions delivered organic revenue growth year on year, with 7% in Global Specialty and 7% in UK Employee Benefits.
• Trading profit grew 21% year on year, driven by organic revenue growth and the Global Transformation Programme. Trading Profit increased by 25% in Global Specialty to £192.7m, 10% in Global Reinsurance to £45.8m and 8% in Global Employee Benefits to £51.2m.
•US Specialty revenue increased by US$38.8m to US$134.4m, net investment losses decreased to US$9.9m and the business remains on track to achieve profit in 2019.
•UK Employee Benefits increased trading profit by 55% year on year to £21.6m, driven by organic revenue growth, combined with higher trading margins. The business remains on track to achieve a 15% trading margin in 2019.
•The Global Transformation Programme delivered benefits of £20.7m for a cost of £28.6m and remains on track to deliver further incremental benefits of £16.3m in 2019, and full annualised benefits of £40m in 2020.
Exceptional items principally consist of MMC-related transaction costs of £77.2m (predominantly staff costs relating to the amortisation of remuneration payments and the acceleration of share awards vesting outlined in the Scheme Document), estimated net costs of £38.4m arising from the UK regulatory review disclosed in JLT's 2017 Annual Report relating to enhanced transfer value products, and Global Transformation Programme restructuring charges of £28.6m.
In light of the cash consideration of £19.15 per share to be paid by MMC to JLT shareholders on completion of the MMC transaction, and consistent with the terms of the MMC cash offer, no final dividend will be paid for the 2018 financial year.
Enquiries
Jardine Lloyd Thompson Group plc
Dominic Burke Group Chief Executive 020 7558 3373
Charles Rozes Group Finance Director 020 7558 3380
Paul Dransfield Head of Investor Relations 020 7528 4933
Brunswick Group LLP
Tom Burns/Rosheeka Field Brunswick Group LLP 020 7404 5959
Disclaimer
This document may contain forward-looking statements that may or may not prove accurate. For example, statements regarding expected revenue growth, margins and market trends are forward-looking statements. Phrases such as 'aim', 'plan', 'intend', 'anticipate', 'well-placed', 'believe', 'estimate', 'expect', 'target', 'consider' and similar expressions are generally intended to identify forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results to differ materially from what is expressed or implied by the statements. Any forward-looking statement is based on information available to JLT as of the date of the statement. All written or oral forward-looking statements attributable to JLT are qualified by this caution. JLT does not undertake any obligation to update or revise any forward-looking statement to reflect any change in circumstances.
LEI Number: 213800XRWB6SDDCZZ434
Condensed Income Statement | Year ended 31 December 2018 | ||
for the year ended 31 December 2018 | Underlying profit £'000 | Exceptional items £'000 | Total £'000 |
Fees and commissions | 1,438,416 | - | 1,438,416 |
Investment income | 12,865 | - | 12,865 |
Operating costs | (1,197,198) | (145,442) | (1,342,640) |
Trading profit | 254,083 | (145,442) | 108,641 |
Finance costs - net | (23,562) | - | (23,562) |
Share of results of associates | 3,055 | - | 3,055 |
Profit before taxation | 233,576 | (145,442) | 88,134 |
Income tax expense | (56,653) | 22,861 | (33,792) |
Profit for the year | 176,923 | (122,581) | 54,342 |
Profit attributable to: | |||
Owners of the parent | 163,318 | (120,317) | 43,001 |
Non-controlling interests | 13,605 | (2,264) | 11,341 |
Earnings per share attributable to the owners of the parent during the year (expressed in pence per share) | |||
Basic earnings per share | 77.0p | 20.3p | |
Diluted earnings per share | 74.4p | 19.6p | |
Year ended 31 December 2017 (restated) | |||
Underlying profit £'000 | Exceptional items £'000 | Total £'000 | |
Fees and commissions | 1,373,689 | - | 1,373,689 |
Investment income | 7,474 | - | 7,474 |
Operating costs | (1,171,999) | (9,882) | (1,181,881) |
Trading profit | 209,164 | (9,882) | 199,282 |
Finance costs - net | (24,349) | - | (24,349) |
Share of results of associates | 2,149 | - | 2,149 |
Profit before taxation | 186,964 | (9,882) | 177,082 |
Income tax expense | (52,424) | 422 | (52,002) |
Profit for the year | 134,540 | (9,460) | 125,080 |
Profit attributable to: | |||
Owners of the parent | 123,154 | (8,332) | 114,822 |
Non-controlling interests | 11,386 | (1,128) | 10,258 |
Earnings per share attributable to the owners of the parent during the year (expressed in pence per share) | |||
Basic earnings per share | 58.3p | 54.4p | |
Diluted earnings per share | 56.9p | 53.0p | |
Condensed Balance Sheet
as at 31 December 2018 | Restated | |
2018 | 2017 | |
£'000 | £'000 | |
NET ASSETS | ||
Non-current assets | ||
Goodwill & other intangible assets | 732,641 | 686,732 |
Property, plant and equipment | 66,770 | 68,645 |
Investments in associates | 54,234 | 53,055 |
Other financial assets | 20,385 | 16,858 |
Derivative financial instruments | 83,996 | 82,569 |
Trade and other receivables* | 60,355 | 39,950 |
Deferred tax assets | 76,696 | 63,751 |
1,095,077 | 1,011,560 | |
Current assets | ||
Trade and other receivables* | 648,063 | 564,301 |
Current tax assets | 7,219 | - |
Derivative financial instruments | 3,241 | 5,545 |
Other financial assets | 164,163 | 115,269 |
Cash and cash equivalents | 1,007,484 | 1,015,087 |
1,830,170 | 1,700,202 | |
Current liabilities | ||
Borrowings | (17,867) | (19,226) |
Trade and other payables** | (1,483,815) | (1,280,245) |
Derivative financial instruments | (9,634) | (10,265) |
Current tax liabilities | - | (10,290) |
(1,511,316) | (1,320,026) | |
Net current assets | 318,854 | 380,176 |
Non-current liabilities | ||
Borrowings | (715,525) | (690,872) |
Trade and other payables** | (258,032) | (247,678) |
Derivative financial instruments | (112,617) | (85,516) |
Deferred tax liabilities | (11,656) | (11,773) |
(1,097,830) | (1,035,839) | |
316,101 | 355,897 | |
TOTAL EQUITY | ||
Capital and reserves attributable to the owners of the parent | ||
Shareholders' equity | 296,132 | 336,444 |
Non-controlling interests | 19,969 | 19,453 |
316,101 | 355,897 | |
*includes Contract Assets and Retirement benefit surpluses | ||
**includes Contract Liabilities, Provisions for Liabilities and Charges and Retirement Benefit Obligations | ||
The accounting policies applied in the preparation of the condensed Income Statement and Balance Sheet are consistent with those of the Interim Financial Statements for the 6 months ended 30 June 2018 | ||
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JLT - Jardine Lloyd Thompson Group plc published this content on 26 February 2019 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 26 February 2019 07:22:28 UTC
