XPS Pensions posts strong growth, chair to step down

(Sharecast News) - XPS Pensions Group delivered another year of strong growth in the year ended 31 March, it announced on Thursday, with revenue rising 18% to £231.8m excluding the impact of the NPT disposal, driven by robust demand across advisory and administration services. Adjusted EBITDA increased 27% to £69.7m, lifting the margin to 30.1% from 27.9% a year earlier, while adjusted profit before tax rose 34% to £59.5m.

Diluted earnings per share were up 36% to 20.6p.

The FTSE 250 company proposed a final dividend of 8.2p, bringing the full-year payout to 11.9p, an increase of 19%.

Actuarial and consulting revenue grew 14% to £106.1m, supported by continued demand for risk transfer and GMP projects, while investment consulting revenue dipped 4% following two years of strong growth.

Administration revenues jumped 30% to £93.7m, boosted by new client onboarding, GMP work, and delivery of the McCloud remedy projects.

SIP revenues were up 15% at £12.6m.

"We are delighted that for the third year in a row we have achieved really strong growth and are reporting another excellent set of financial results," said co-chief executive officer Paul Cuff.

"In the public sector our work on McCloud was a huge challenge, but we rose to it and delivered successfully for the members of the schemes we administer.

"Our strong client survey results show that we're meeting their needs well too."

Statutory profit before tax fell 35%, reflecting the prior-year impact of the NPT disposal, but excluding that effect, profits rose 36%.

Operating cash flow conversion remained strong at 96%, and net debt rose to £40.3m, equivalent to 0.57 times adjusted EBITDA, still well below the group's target range of 1.0 to 1.5 times.

"It has been exciting to welcome new colleagues to the group with the acquisition of Polaris," commented co-CEO Ben Bramhall.

"The integration is progressing to plan, and we are pleased with a very positive response from clients and our people."

Looking ahead, XPS said it was confident in its outlook, with continued regulatory and market change expected to drive demand.

The firm pointed to further opportunities in the insurance consulting sector following the acquisition of Polaris and said migrations to its proprietary Aurora platform would continue to support efficiency gains.

Separately, the group announced a leadership transition.

Alan Bannatyne would step down as chairman following the annual general meeting in September after nearly nine years on the board.

He would be succeeded by Martin Sutherland.

Margaret Snowdon OBE was also set to step down in early 2026.

"What a transformation since listing," commented outgoing chair Bannatyne.

"I can only commend the team in the highest possible way, not just for creating growth and increasing profits, but also for always focusing on the longer-term opportunities."

At 0941 BST, shares in XPS Pensions Group were up 4.26% at 392p.

Reporting by Josh White for Sharecast.com.