Investors weren’t impressed with Hansard Global’s (HSD) latest showing. Within minutes of the opening bell, the specialist long-term saving provider’s shares were heading south. Management was keen to emphasise how it continues to build and diversify revenue streams, mirrored by another rise in the present value of new business premiums in the six months to December 2017, this time by 2.9 per cent to £77m. This compensated, to an extent, for some brokers exiting Middle Eastern markets because of regulatory and competitive pressures.
Unfortunately, those revenue gains, generated mainly from Latin America and the rest of the world segment, failed to boost the bottom line. Margins contracted considerably due to new savers choosing single premiums over more profitable regular premiums. That trend, coupled with unfavourable currency movements, additional costs from selling new contracts, increased litigation defence expenses, and the ongoing reduction in income from the now closed European operation, triggered the double-digit contraction in reported profits.