Update

RNS Number : 2259C

Brown (N.) Group PLC

11 April 2017

 

11^th April 2017

FY17 EXCEPTIONAL COSTS UPDATE

N Brown Group Plc ("N Brown" or the "Group") provides the following update on its estimated exceptional costs for FY17.

The Group has previously guided to FY17 exceptional costs of c.£12m, of which £9m related to financial services customer complaint redress. Within this £9m we had provided for, firstly, recompensing certain customers due to an error in our previous calculation for redress and, secondly, our estimate of the likely future costs arising from complaints relating to financial services products sold in the past. 

We now expect the cost of likely future complaints to be higher than our previous estimate for the following reasons:

·     The Financial Conduct Authority's ("FCA") industry-wide deadline for complaints has been announced as August 2019, a year later than had previously been indicated

·     We have experienced a greater than anticipated volume of complaints due to wider public awareness of the August 2019 deadline

·     The age profile of complaints received are typically older than we had previously experienced, which increases the average redress amount; and

·     An adjustment due to the Supreme Court judgment in the case of Plevin v Paragon Personal Finance Ltd, taking into account the final guidance and rules recently issued by the FCA.

We therefore expect to incur an FY17 exceptional cost related to financial services customer complaint redress in the region of £22m - £24m. The cash cost associated with this exceptional item will be incurred over the period to August 2019.

We continue to expect an additional £2m - £3m exceptional costs in FY17 in relation to our ongoing historic tax cases.  Total FY17 exceptional costs are therefore expected to be in the region of £24m - £27m. 

We will be announcing our FY17 full year results on 27 April 2017. 

For further information:

N Brown Group
Craig Lovelace, CFO                        Bethany Hocking, Director of Investor Relations	On the day 07887 536153 Thereafter 0161 238 1845
MHP
John Olsen / Simon Hockridge	0203 128 8100 [e-mail]

 

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