2018 Annual Report Overview

For the generations of today and tomorrow

Quilter

We are a leading wealth management business, helping to create prosperity for the generations of today and tomorrow.

Chairman & CEO

Chairman

I am delighted to introduce Quilter’s 2018 Annual Report and Accounts, our first as an independent quoted company.

Glyn Jones

Chairman

CEO

2018 was a momentous year in the history of Quilter. We are a modern, purpose-built UK wealth management company that has many opportunities ahead of it.

Paul Feeney

Chief Executive Officer

Our strategy

We aim to be the leading UK wealth manager by continuing to focus on delivering good outcomes for our customers.

Our strategic priorities

Ensure we deliver good customer outcomes, strong investment returns and quality customer service.

2018 achievements

  • Stable asset retention
  • Low levels of upheld complaints

Focus in 2019

  • Drive investment performance
  • Launch full-service SIPP

Grow our advice business by adding financial advisers and investment managers ("IMs"), supporting them to improve their individual productivity. We will also complete the build out of our Quilter Investors team.

2018 achievements

  • Strong profit growth
  • Resilient integrated flows

Focus in 2019

  • Growth in restricted financial planners/private client advisers - embed and leverage acquisitions
  • Growth in IMs in Quilter Cheviot

Deliver our UK Platform Transformation Programme ("PTP") which will bring benefits including greater capability and functionality.

2018 achievements

  • Strong underlying UK Platform growth
  • PTP progress leading to soft launch in early 2019

Focus in 2019

  • UK platform migration
  • Supporting advisers and customers

We will grow our business by enhancing our scale and efficiency whilst reducing unnecessary cost and complexity.

2018 achievements

  • Phase 1 planning complete
  • Early savings achieved through cost management

Focus in 2019

  • Mobilise Phase 1 initiatives
  • Protect PTP-related areas

Key performance indicators

Quilter has identified the key performance indicators it believes are useful in assessing the Group’s performance against its strategic priorities. They encompass both financial and non-financial measures, as set out below.

NCCF/opening assets under management and administration

6%
9%
5%
201620172018

Integrated flows

£2.2bn
£5.2bn
£4.7bn
201620172018

Operating margin

32%
29%
30%
201620172018

Adjusted profit before tax

£208m
£209m
£233m
201620172018

Total shareholder returnR

201620172018
n/a
n/a
(11%)

IFRS profit before taxR

£25m
£67m
£49m
£(5)m
£112m
£5m
201620172018
IFRS profit before tax (excluding amortisation and life tax contributions)IFRS profit before tax

Restricted financial planners

1,423
1,561
1,621
201620172018

Investment managers

158
164
155
201620172018

RThis KPI is linked to Remuneration. See Remuneration report on page 64 of the full report for more information.

Responsible business

We are committed to growing Quilter responsibly for the long-term, recognising that we must earn the trust of our stakeholders.

Responsible business

Our Shared Prosperity Plan

In light of external trends and our strategic business priorities, our Shared Prosperity Plan focuses on three long-term goals and nine commitments which are most material to our customers and our business. These goals and commitments will guide our responsible business activity to 2025.

To enhance financial capability

Commitments

  • Enable all our colleagues to feel money confident
  • Improve access to financial guidance and advice for customers and consumers more widely
  • Empower young people to manage their money well for life

To enable secure futures

Commitments

  • Enable all colleagues to thrive in work and fulfil their potential
  • Empower customers to be more engaged in their financial future
  • Help people in the community overcome the barriers to prosperity

To promote responsible investment

Commitments

  • Create an inclusive culture at work that embraces diversity
  • Embed responsible investment principles across our business
  • Reduce the environmental intensity of our activities

Governance

You can read more about our Board of Directors, executive management team, and our approach to corporate governance and remuneration.

Chairman

We believe that outstanding corporate governance adds value for all of our stakeholders. That conviction has guided the design of our governance framework.

Glyn Jones

Chairman

An effective system of corporate governance, with appropriate checks and balances to assess, manage and mitigate risks, is important in any organisation to enable it to anticipate and adapt to changing internal and external circumstances.

For a young, newly standalone listed company operating in a fast growing but highly regulated environment, a robust governance framework, overseen by a skilled and experienced board, is absolutely critical.