Final Results

Life Settlement Assets PLC

28 April 2023

 

Life Settlement Assets PLC

(the "Company" or "LSA")

Results for the year ended 31 December 2022

LSA, a closed-ended investment trust company which invests in, and manages, portfolios of whole and fractional interests in life settlement policies issued by life insurance companies operating predominantly in the United States, is pleased to announce its results for the year ended 31 December 2022, and the publication of its 2022 Annual Report.

The highlights of the year were as follows:

Finalisation of MBC litigation

·    Formal acceptance on 2 March 2023 by the US Court of the southern District of Florida, Miami Division, of the sale of life policies portfolio to Acheron Portfolio Trust ("APT"), on behalf of the Company.

·    Mitigation of operational risk with fractional interests in policies now able to be consolidated into policies 100% owned by APT.

·    More cost-effective operations in the future with a significant reduction in future legal costs.

·    Reduced need to retain cash following the life policies portfolio purchase, together with a resumption of dividends payable by the Company.

Net Asset Value

·    USD 109.9 million, representing an uplift of USD 0.6 million during the year.

Maturities

·    Maturities totalling USD 27.2 million were declared - of these, USD 20.9 million were non-HIV policies, and USD 6.3 million were HIV policies.

Costs

·    Decrease in total ongoing charges ratio from 7.6% to 7.1% of NAV in 2022.

·    Decrease in ongoing charges ratio excluding policy servicing fees and legal costs from 3.6% to 3.0% of NAV.

·    The Company has agreed a reduction of the Investment Manager performance fee from 20% to 10% of the total distributions made by the Company over the agreed hurdle rate.

Dividend

·    Since the year end, following the initial indication of the ruling of the US Court, LSA announced on 2 February 2023, the declaration of a special dividend of 6.0209 cents per share totalling approximately USD 3.0 million, which was paid to Shareholders on 24 February 2023.

Michael Baines, Chairman, commented:

"The successful conclusion of your Company's long running litigation against MBC marks a significant development in our strategy of unlocking value for Shareholders.  It removes an important area of risk, builds value, and unlocks alternatives for the deployment of funds arising on the maturity of policies. It also means that the Board's attention can focus solely on the broader risk issues in the portfolio, including that of HIV mortality.

The Board is acutely aware of the impact that last year's cash retention policy has had on the level of discount at which LSA's shares trade.  Therefore, in addition to the announcement of a special dividend and a return to the previous approach to dividend payments generally, the Board is actively considering further options to reduce this discount, which will be communicated to Shareholders at the appropriate time.

Given that the non-HIV portfolio is now expected to mature faster than the HIV portfolio, we will continue to closely monitor research on mortality in general to guide future decisions.  The past track record of assessing risk across the portfolio gives the Board confidence that outcomes should be achieved which will continue to underpin the value proposition for Shareholders."

The Directors are pleased to attach the Company's annual report and financial statements for the year ended 31 December 2022.

Click on the following link, or paste it into your web browser, to view the associated PDF document:

http://www.rns-pdf.londonstockexchange.com/rns/7833X_1-2023-4-27.pdf

The annual report and financial statements for the year ended 31 December 2022 may also be downloaded from the Company's website at

 https://www.lsaplc.com/investor-relations/company-reports/published-reports/

For further information contact:

Acheron Capital Limited (Investment Manager)

Jean-Michel Paul

020 7258 5990

Shore Capital (Financial Adviser and Broker)

Robert Finlay

020 7408 4090

ISCA Administration Services Limited

Company Secretary

Tel: [phone]

DISCLAIMER

Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

NATIONAL STORAGE MECHANISM

A copy of the 2022 Annual Report and Accounts will be submitted shortly to the National Storage Mechanism ("NSM") and will be available for inspection at the NSM, which is situated at:

https://data.fca.org.uk/#/nsm/nationalstoragemechanism

Notes to Editors

Life Settlement Assets PLC is a closed-ended investment trust company which invests in, and manages, portfolios of whole and fractional interests in life settlement policies issued by life insurance companies operating predominantly in the United States. The Company seeks to generate long-term returns for investors by investing in the life settlement market, through each of the separate Share Classes. The Company aims to manage its investment in portfolios of life settlement products so that the realised value of the policy maturities exceeds the aggregate cost of acquiring the policies, ongoing premiums, management fees and other operational costs.

 

END