CLEARVIEW WEALTH LIMITED — Interim / Quarterly Report 2012

Feb 21, 2012

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22 February 2012

The Manager Companies Announcement Office Australian Securities Exchange Level 4, 20 Bridge Street Sydney NSW 2000

Dear Sir/Madam,

RESULTS FOR ANNOUNCEMENT TO THE MARKET

Please refer to the following information in relation to ClearView Wealth Limited’s results for the six months ended 31 December 2011.

Part 1: Appendix 4D

Part 2: Half Year Condensed Consolidated Financial Report

Part 3: Results Market Release

Part 4: Results Investor Presentation

Yours sincerely

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Chris Robson

General Counsel and Company Secretary

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Appendix 4D for the half year ended 31 December 2011

ClearView Wealth Limited ABN 83 106 248 248 Appendix 4D

Name of Entity: ACN: Half year ended ("reporting period") Half year ended ("previous corresponding period")
	ClearView Wealth Limited
	106248248
	31 December 2011
	31 December 2010

Results for announcement to the market

(Amount and percentage change up or down from the previous corresponding period)

Operating revenue before net fair value gains on financial assets Net operating revenues from ordinary activities(1) Net profit after tax from ordinary activities Net profit for the reporting period attributable to members	Dec-11	Dec-10	% **Change **
	$'000	$'000
	76,361	70,056	9%
	18,419	156,144	(88%)
	12,231	2,942	316%
	12,231	2,942	316%

(1) Net operating revenues from ordinary activities includes amounts attributable to shareholders, policyholders and external unitholders. The amount is the aggregate of premium revenue of $18m (2010: $19m), fee and other revenue of $22m (2010: $23m), investment income of $36m (2010: $28m) and net fair value losses of $58m (2010: $86m gain).

Dividends

Interim dividend declared Record date for determining entitlements to the dividends	Amount per security	Franked amount
		per security
	Nil	Nil
		n/a

The Directors have not declared an interim dividend (1H FY11: Nil). A final dividend for FY11 of $7.7m was paid during the half year (1H FY11: Nil).

ClearView is in a strong capital position with no debt and $59m in excess of its regulatory requirements and internal benchmarks at 31 December 2011. Internal benchmarks exceed regulatory requirements.

Details of dividend reinvestment plan in operation and the last date for the receipt of an election notice for participation in any dividend reinvestment plan.

The directors have previously suspended the Dividend Reinvestment Plan (DRP). No interim dividend has been declared.

ClearView Wealth Limited ABN 83 106 248 248 Appendix 4D (continued)

Review and results of operations

The key focus of the Group for the half year period was the successful launch in December 2011 of ClearView LifeSolutions (LifeSolutions) and ClearView WealthSolutions (WealthSolutions). LifeSolutions is a full suite of life advice products and services. WealthSolutions is a private label wrap platform for superannuation, retirement income and Investor Directed Portfolio Service (IDPS) accounts, and includes a number of new ClearView managed funds and model portfolios.

ClearView’s range of new life insurance and wealth management products and services enables the Group to penetrate the independent financial adviser (IFA) market, improve the product and service offering for ClearView financial planners, grow its financial planning business, and significantly broaden the Group’s exposure to the wealth management and life insurance markets.

As part of the Group’s strategy to increase distribution of its products and services, the Group has commenced recruiting experienced and successful financial advisers to join the ClearView Financial Advice Pty Limited (CFA) dealer group. Most notably Lambert Investments Pty Limited (Lambert) joined the dealer group in September 2011 with over 6,000 clients, approximately $100 million of funds under administration and $8 million of in-force life insurance premium.

The Group is developing its presence in the IFA market (including obtaining access to approved product lists of third party dealer groups) and will be entering distribution agreements and arrangements with IFAs and dealer groups as suitable relationships are established.

The Group has achieved the following results in 1H FY12:

• Net profit after tax of $12.2 million (1H FY11: $2.9 million), representing an increase of 316% over the prior comparable period;

• Basic earnings per share for the half year on a statutory basis of 2.99 cents per share (1H FY11: 0.72 cents per share), representing an increase of 315% over the prior comparable period;

• Fully diluted earning per share on a statutory basis of 2.88 cents per share (1H FY11: 0.69 cents per share), representing an increase of 318% over the prior comparable period; and

• Underlying net profit after tax of $9.1 million (1H FY11: $10.3 million), representing a decrease of 12% over the prior comparable period.

Underlying net profit after tax (NPAT) is the Board’s key measure of profitability and the basis on which dividends are determined. It consists of profit after tax adjusted for amortisation, the effect of changing discount rates on the insurance policy liabilities and, in the prior comparable period, restructure, transition and system upgrade costs considered unusual to the Group’s ordinary activities.

Underlying NPAT has decreased by $1.2m (12%) compared with that for the half year ended 31 December 2010, equivalent to a decrease in basic underlying earnings per share for the half year from 2.51 cents per share to 2.22 cents per share (12%). This result reflects:

• The negative impact of investment markets on fee income and net investment flows. In addition, a general deferral of retirement plans of clients (and related investment into retirement products) has disproportionately impacted ClearView owing to its historic participation in the retiree market. Fee income is likely to remain hostage to global developments and sentiment in the short term;

• Investment in the business (and related increase in the cost base) to develop the Group’s range of new products and infrastructure to expand the business (see discussion above); and

• The negative impact of life insurance lapses exceeding the rates assumed in the life insurance policy liability determined at 30 June 2011.

ClearView Wealth Limited ABN 83 106 248 248 Appendix 4D (continued)

Review and results of operations (continued)

Partially offset by:

• Good claims experience in the 1H of the current financial year; and

• • Materially similar tax benefits in both periods.

Reported NPAT has increased by $9.3m (316%) compared with that for the half year ended 31 December 2010, equivalent to an increase in reported earnings per share from 0.72 cents per share to 2.99 cents per share (315%). This result reflects:

• A significant positive impact of $6.5m after tax from the impact on the life insurance contract liability (based on AIFRS) of the reduction in long term discount rates over the reporting period;

• No restructure, transition and acquisition type related costs (considered unusual to the Groups ordinary activities) being incurred in the 1H of the current financial year; and

• • The factors impacting the underlying NPAT as reported above.

A reconciliation of the reported net profit after tax to underlying NPAT is as follows:

2011 **$ million **	2010 $ million % Increase (Decrease)
Reported Profit
Adjusted for: 12.2	2.9 316%
Amortisation of intangibles 3.4	3.9 (13%)
Policy liability discount rate effect (9.3)	2.6 (463%)
System upgrade costs -*	0.7 (100%)
Restructure and transition costs -*	2.1 (100%)
Other -	(0.1) (100%)
Income tax effect 2.8	(1.8) (256%)
Underlying net profit after tax 9.1	10.3 (12%)

*Considered unusual to ordinary activities of the Group

• The amortisation of the intangibles is associated with the acquisition of ClearView Group Holdings Pty Limited (CVGH) and CFA (formerly ComCorp Financial Advice Pty Limited) and is separately reported to remove the non cash effect of the write-off of these intangibles;

• The policy liability discount rates effect is the result of the changes in long term discount rates used to determine the insurance policy liabilities. The life insurance policy liability (based on AIFRS) is discounted using market discount rates that typically vary at each reporting date and create volatility in the policy liabilities and consequently earnings. ClearView separately reports this volatility which represents a timing difference in the release of profit and has no impact on underlying cash earnings;

• Restructure and transition costs in the prior comparable period predominantly related to the transition off the Bupa Australia Pty Limited (Bupa) IT Infrastructure and the termination and related salary costs associated with the organisational restructure and termination of employees. Terminations were completed by 31 October 2010; and

• Fintechnix system upgrade costs in the prior comparable period related to the upgrade to the latest version of the life administration platform acquired as part of the acquisition of CVGH. The extent of the upgrade (catchup) was such that it was considered as unusual to the ordinary activities of the Group. All subsequent costs incurred on system upgrades are either reported as part of underlying profit or capitalised in accordance with the ClearView capitalisation policy.

ClearView Wealth Limited ABN 83 106 248 248 Appendix 4D (continued)

Net tangible assets per security Net tangible asset backing per ordinary security (cents)		Previous corresponding period
	Reporting period
	48.8	44.4

Net tangible asset backing per ordinary share excludes the shares issued in terms of the employee share plan (ESP) as well as the associated ESP plan loans. Had the employee share plan shares been included in the calculation together with the ESP plan loans the net tangible asset backing per share would have been 49.2 cents per share (December 2010: 45 cents per share).

Control gained or lost over entities

None.

Details of associates and joint venture entities

ClearView Financial Advice Pty Limited continues to hold 40% of the issued shares in Berry Financial Services Pty Limited.

Compliance Statement

The information provided in this report has been prepared in accordance with AASB standards, other AASB authoritative pronouncements or other standards acceptable to ASX.

The ClearView Wealth Limited Condensed Consolidated Half Year Report for the six months ended 31 December 2011 has been subject to review by our external auditors. A copy of the independent review report to the members of ClearView Wealth Limited is included in the Half Year Condensed Consolidated Financial Report.

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Chris Robson Company Secretary