XPS Pensions Group plc

Annual Report and

Accounts 2026

Delivering

sustainable

growth

Strategic report

Highlights 2

At a glance 4

Investment case 5

Business model 6

Markets overview 8

Our strategy 10

Co-Chief Executives’ review 12

Sustainability 16

Non-financial and sustainability

information statement 36

Chief Financial Officer’s review 37

Principal risks and uncertainties 43

Viability statement 51

Governance

Chair’s introduction 52

Board of Directors 54

Board and Committee composition

andoperation 56

Stakeholder engagement 60

Nomination Committee 62

Audit & Risk Committee 65

Sustainability Committee 68

Directors’ remuneration report 70

Annual report on remuneration 84

Directors’ report 94

Directors’ responsibility statement 98

Financial statements

Independent auditor’s report 99

Consolidated statement of

comprehensiveincome 108

Consolidated statement of

financial position 109

Consolidated statement of changes

inequity 110

Consolidated statement of cash flows 111

Notes to the consolidated financial

statements 112

Statement of financial position

– Company 144

Statement of changes in equity

– Company 145

Statement of cash flows – Company 146

Notes to the financial statements

–Company 147

Company information 151

Contents

Delivering

sustainable

growth

Our purpose

We exist to shape and support pension

schemes and other institutions that

provide long-term financial security

to people, for the benefit of society,

and at the same time achieve

profitable growth.

Why we exist

Who we are

XPS is a leading UK consulting and administration

business specialising in the pensions sector and

providing wider ranging support to insurance

companies in the life andbulk annuities sector.

What drives us What we want to achieve

Our vision

We will constantly challenge the

status quo to drive better outcomes

for members and policyholders,

offering our people exciting

andrewarding careers.

Our mission

We strive to be leaders in consulting

and administration with brilliant people

and leading technology enabling

pension schemes, insurers and other

financial institutions to deliver better

outcomes for their members and

policyholders. Our ambition is to

be the best employer in our market,

recognising that our people are at the

heart of what we do and are critical to

our future success.

A forward-looking, ambitious business

Strategic report

Our strategy

Our purpose-driven strategy is centred on our four strategic priorities whilst

delivering long-term, sustainable returns and creating value for our shareholders.

Our sustainability framework has

the mission to “shape a better

future”. With clear ambitions for

each of its priority areas, the

framework supports our corporate

priorities with the ultimate aim to

ensure that sustainability is

embedded in our business model,

products and services.

Read more on pages 10 and 11

Our people

Experts in their fields, our people drive the

business. They’re the innovators, the

problem-solvers, theforward-thinkers,

andthat’s why weinvest in them.

Our culture

Values driven, employee centric, inclusive,

friendly, meritocratic – our culture

empowers our business.

Our technology

We invest in technology to deliver our

services efficiently and to bring clarity and

understanding to the complex problems

we help to solve.

Our financial strength

We are consistently profitable with the

financial resources to invest in the

development of services to anticipate

client needs.

Revenue

+13%

Proposed full-year dividend

+11%

FY 2026 FY 2026

FY 2025 FY 2025

£231.8m

£262.7m

11.9p

13.2p

Highlights

Financial

1 Adjusted EBITDA excludes the impact of exceptional and non-trading items (see note 5 in the financial statements). See table 1 in the

appendix to the Chief Financial Officer’s Review for more detail.

2 Adjusted diluted earnings per share is based on adjusted profit after tax, which excludes the impact of exceptional and non-trading items

and the tax impact of these items (see note 5 in the financial statements). Also see table 3 in the appendix to the Chief Financial Officer’s Review.

3 As at year end.

4 For banking covenant purposes, net debt is the drawn revolving credit facility less cash held. This includes any amount owed as contingent

consideration, but excludes lease liabilities.

Adjusted diluted earnings per share

+8%

Profit before tax

-5%

FY 2026FY 2026

FY 2025FY 2025

£40.8m

£38.7m

20.6p

22.3p

FTE employees

+6%

Basic earnings per share

-12%

FY 2026FY 2026

FY 2025FY 2025

1,901

2,024

Adjusted EBITDA

+9%

Net debt/adjusted EBITDA

+12%

FY 2026 FY 2026

FY 2025 FY 2025

£69.7m

£75.7m

0.57x

0.64x

14.7p

13.0p

XPS Pensions Group plc Annual Report and Accounts 2026

Strategic report

Number of transactions for whichwe

provided risk transfer advice

2025: 32

Operational Sustainability

Number of schemes that we

advise with over £1bn of assets

2025: 86

Members under administration

1.2m

2025: 1.2m

High eNPS score for the second year in a row

+32 eNPS

2025: +24 eNPS

Continuing investment in softwareassets

to drive operationalefficiencies and

improvecustomer experience

£7.5m

2025: £6.3m

Senior management positions held bywomen

39%

FY 2026

FY 2025

38%

39%

Electricity sourced from no carbon sources

100%

FY 2026

FY 2025

90%

100%

Number of clients in Sustainable funds

FY 2026

FY 2025

XPS Pensions Group plc Annual Report and Accounts 2026

At a glance

What we do

XPS Group is a leading UK consulting and administration business specialising

inthe pensions sector and providing wider ranging support to insurance companies

in the life and bulk annuities sector. We have benefits of scale – wehave a breadth

of experience to draw on and can invest in solutions for the benefit of our clients –

yet we remain agile, able to respond quickly astheworld around our clients shifts.

Welcome to XPS Group

Our services

UK locations

Our 15 locations give us access

toemployees, expertise

andclientsacross the UK.

2,100+

Employees

Our 2,100+ employees have

market-leading experience and

knowledge and pride themselves

onthe highest delivery standards

tosolve our clients’ needs.

1,300+

Clients

We build strong relationships

withour clients, which lead

torepeat business and

opportunitiesto cross-sell.

The foundations of a thriving business

Advisory

We help make sure there is

enough moneyin schemes

Pensions

We provide pragmatic advice that addresses the specific and often complex

challenges faced by UK pension schemes and their corporate sponsors.

xpsgroup.com/what-we-do/pensions-advisory/

Insurance

We provide consulting services that are strategically designed tohelp life

andannuity insurance clients navigate market disruption and stay ahead

ofevolvingregulations.

xpsgroup.com/what-we-do/insurance-consulting/

Investment

We provide clear and independentinvestment advice which we help clients

implement quickly and effectively.

xpsgroup.com/what-we-do/investment-consulting/

Administration

We keep all the records,

communicate with members

and pay thepensions

Administration

Our award-winning pensions administration service puts scheme members

attheheart of everything we do.

xpsgroup.com/what-we-do/ administration/

Self Invested Pensions

We have specialised in

self-invested pensions for

more than 45 years

Self Invested Pensions

XPS Self Invested Pensions is an award-winning SIPP and SSAS pension

provider,trustee and administrator, which has specialised in self invested

pensions for more than 45 years.

xpsselfinvestedpensions.com

XPS Pensions Group plc Annual Report and Accounts 2026

Strategic report

Investment case

Why invest in XPS Group?

Diversified and

stable client base

We have long-standing relationships with alarge

and diverse client base, consisting of over 1,300

clients. We have a strong brand and have won

multiple industry awards for our client service.

Read more on pages 11

acquisitions

since listing in 2017

XPS Pensions Group plc Annual Report and Accounts 2026

Specialist insight and expertise:

Our team of experts brings

deep knowledge and

experience to the table.

Exceptional quality service

and tailored solutions:

We pride ourselves on

delivering a quality service.

Our culture: Our culture

andvalues guide us

ineverything we do.

Diverse client base: XPS serves

a diverse range of clients,

including large corporate schemes,

public sector funds, smaller

pension arrangements and other

financial institutions.

Our resources

Business model

Strong brand: Our strong

award-winning brand sets

us apart from our competitors

and communicates our values

and brand promise.

Our people

Experts in their fields, our people

drive the business. They’re the

innovators, the problem-solvers,

theforward-thinkers, andthat’s

whywe invest in them.

Our culture

Values driven, employee centric,

inclusive, friendly, meritocratic –

our culture empowers our business.

Our technology

We invest in technology to deliver

our services efficiently and to bring

clarity and understanding to the

complex problems we help to solve.

Our financial strength

We are consistently profitable with

the financial resources to invest in

the development of services to

anticipate client needs.

XPS Group’s unique proposition is its ability to add value across its business. Ourpeople,

culture, technology and financial strength make this possible.

Delivering strong and stable growth

Our competitive advantage

XPS Pensions Group plc Annual Report and Accounts 2026

Strategic report

Value for all stakeholdersHow we create value

Clients

• Specialist insight and expertise

leading tobetter outcomes for

allstakeholders

• High-quality service

andtailored solutions

• Value for money

Read more on page 15

Effective capital allocation is crucial for

sustained growth and competitiveness. It

plays a vital role in shaping the firm’s overall

strategy and ensuring long-term success.

Capital allocation priorities

Organic

growth

Best in class

technology

platform

Progressive

dividends

Earnings

enhancing

strategic M&A

Capital

allocation

priorities

XPS Pensions Group plc Annual Report and Accounts 2026

Large addressable markets for our services

Markets overview

Our end markets are large

. We estimate that the fee market for services required by

pension scheme trustees and employers to be around £3bn pa. The Group’s addressable

market now extends

to insurers and other institutions, including participants in the

bulk annuities market and providers of long-term financial protection, with an

addressable fee market of an additional £1.5bn.

New regulation passed

Regulatory landscape changes

Tailored advice is required by trustees and

sponsors on how the rules affect their schemes

and what action should betaken

New multi-year demand stream

forXPS’sservicesisgenerated

Market development

Change in financial circumstancesfor schemes

Tailored advice required by trustees and sponsors

on how the shift in financial markets affects their

schemes and what action should be taken

New multi-year demand stream

forXPS’sservicesisgenerated

In recent years, a series of new regulations has been

passedincluding:

• the Pension Schemes Act of 2021;

• the Pension Schemes Act of 2026;

• the GMP equalisation ruling;

• the CMA review of the investment market; and

• a recent new funding code for defined benefit schemes.

Each of the above has given rise to incremental growth

within existing revenuestreams. More regulations in the

future are inevitable; we expect new rules on the release of

surplus from defined benefit schemes to come into force in

the first half of 2027.

Growth from financial market changes

Financial market developments have the same effect

asnew regulations: clients need to navigate the change

andso new demand for our services isgenerated.

A number of key market developments are generating

demand for our services. These include the shift from

alow-to-higher-interest/inflationary rate environment,

thegrowing overlap between the pension scheme and

insurance markets, and growth in the defined contribution

(DC) market.

Markets for all seasons

Our end markets have built-in protection against the

economic cycle and inflation.

Protection against the economic cycle

The UK pensions consulting and administration market

operates largely independently of the wider economy.

Members still need to be paid the correct amount on time,

regardless of prevailing economic conditions. In addition,

scheme funding and strategy require regular monitoring to

ensure obligations to members continue to be met. Pension

schemes require advice and solutions throughout the

economic cycle, including when the wider economy is

facing challenges.

Protection against inflation

Across our markets, contracts and fees are typically linked

to inflation. For work done on the basis of a retainer, client

contracts typically include annual price increases aligned to

an inflationary measure. As a result, pricing in the UK

pensions fee market has historically tracked at least the

rate of inflation, equating to an annual growth rate of 3–4%.

In recent years, market growth has exceeded this long-term

growth rate for two main reasons: inflation has been (much)

higher and increased activity volumes.

Structural growth

Our markets do not merely track inflation; they also benefit

from structural drivers which drive increased activity

volumes. Thesecan be split into two categories: regulatory

growth and growth from financial market changes.

Regulatory growth

To ensure members and the benefits they are due remain

protected at all times, pension schemes operate in a highly

regulated yet constantly evolving environment. New rules

and guidance are regularly drawn up and implemented,

andevery time this happens, new advice and solutions

arerequired.

XPS Pensions Group plc Annual Report and Accounts 2026

Strategic report

The shift from a low-to-higher-interest/inflationary rate environment

What does this mean for pension schemes?

The shift in the interest rate environment has led to a

material improvement in the financial circumstances

of many schemes in recent years. The near-zero

interest rate regime that previously prevailed had led

to many schemes falling into large deficits, meaning

the value of their respective liabilities (what they owe

to members) became far larger than the value of their

respective assets (what the schemes own). Today’s

higher interest rates have led to deficits being sharply

reduced and, in many cases, replaced by surpluses.

How is XPS positioned?

Trustees and corporate sponsors require advice on

what to do with this improved financial position. We

provide that advice and help put in place strategies

that are suitable for individual schemes, whether this

is de-risking to lock in the improved financial position,

run-on-for-surplus (potentially enabling excess funds

to be returned to the sponsor or used to improve

member benefits), or accessing solutions in the bulk

annuity market. We have deep expertise in designing

and implementing all of the strategic options available.

The growing overlap between the pension scheme and insurance industries

What is behind the overlap?

Many defined benefit pension schemes are electing

to de-risk by transferring their responsibilities to

insurance companies via the bulk annuities market.

InFY 2026, there were 350 deals in the UK bulk

annuity market worth a combined £38 billion. This

represents asmall fraction of the estimated

£1.2trillion liabilities still outstanding within the

private sector pension market. Further growth in the

bulk annuity market is therefore expected for many

years to come and as aresult, the overlap between

the pension scheme andinsurance industries will

continue to grow.

What does this mean for pension schemes?

A pension scheme electing to go down the de-risking

route requires a lot of support and advice, including

complex preparatory work on data, benefit

specifications and transaction broking services.

Atransaction from inception to ultimate completion

will typically take three to four years with XPS

providing support throughout.

What does this mean for insurance companies?

Insurance companies taking on the assets and

liabilities of schemes require support and services

toadminister members’ benefits and ensure these

are protected.

How is XPS positioned?

XPS offers a full suite of services to pension scheme

trustees and corporate sponsors through our Risk

Settlement team, as well as to insurance companies

and other commercial entities that seek to take on

pension liabilities such as superfunds. Our observation

is that although the number of defined benefit

schemes will gradually decline, many members of

these schemes will be receiving benefits for 50 years

or more, whether from a pension scheme or another

institution. Essentially, we “follow the member”

throughout the whole process, providing support

topension schemes, insurers and other institutions

that take responsibility for paying members’ benefits.

The wider insurance market

What support do insurers need?

Insurance companies need a lot of support on other

matters too. Most are staffed to deal with stable

business as usual activities, but seek external support

to adapt to market and regulatory changes, which

(like for pension schemes) happen frequently. In

recent years, for example, insurers have needed a lot

of support in adapting to a new accounting standard,

and many need support in modernisation programs

in the area of finance and risk management.

What capability does XPS have?

We began to invest in our insurance consulting

capability two years ago, and have recruited a senior,

experienced team. Building on this we made the

acquisition of an insurance consulting business,

Polaris, early in 2025. We now have the capability

toprovide wide ranging support to insurers,

wellbeyond the overlap created by the bulk

annuitymarket.

How is XPS positioned?

XPS has strong relationships with a number of

thelargest insurance companies in the market.

Wehave 18 Master Service Agreements with such

insurers. As such we are very well placed to win

valuable mandates in the insurance consulting market

in the future.

£4.5bn+

Total addressable market

£3.0bn+

Pension fee market

£1.5bn+

Insurance fee market

Total addressable market

XPS Pensions Group plc Annual Report and Accounts 2026

Our strategy

Our strategic pillars

Pension scheme members need to receive the correct

amounts they are owed when they are due. To ensure

they do, the regulatory landscape governing pension

schemes is constantly evolving. New rules regularly come

into effect and when they do, pension schemes and their

members require advice and support across all four areas

of the UK pensions market – administration, actuarial,

investment and employer covenant – to understand and

adapt to the changing regulatory environment. Typically,

the workflows generated run for multi-year periods.

As our markets expand and evolve so too must the

services we offer. By continually investing in cutting-

edge technology and our people, we can scale up our

platform so that we can always offer new and existing

clients the solutions they need.

As a Group, we have generated nine consecutive years of profitable revenue

growth since becoming a publicly traded company in February 2017.

This growth stems from our four core strategic pillars below.

Capturing growth

Regulatory and market change drives growth in our end markets. Whenever new regulations come

into force or key market developments take place, pension scheme trustees, corporate sponsors,

insurance companies and individual members require support to navigate the change. Demand for

advice and solutions is therefore generated and this in turn drives market growth.

The year saw continued progress made across all four strategic pillars.

Progress in FY 2026

We continued to help clients implement the new Single Code of

Practice and Funding and Investment Code as well as roll out our

equalisation solution for the multi-year GMP rectification project.

Demand was also driven by new rules on pension scheme

valuations that came into force in 2024. These require a change to

how clients’ triennial actuarial valuations are carried out.

Progress in FY 2026

Areas of focus during the year included further expansion of our

services in life insurance consulting, a tangential market for XPS.

Alongside this, we launched XPS Integrated Run-On for DB

trustees and sponsors, XPS Xchange to facilitate illiquid asset

trades on the secondary market, and a new investment solution

for small and medium-sized DC schemes.

Progress in FY 2026

Thanks to being one of the few service providers to have successfully

delivered the McCloud rectification project accurately and on time,

we secured new ongoing administrator mandates including the West

Midlands and Metropolitan Police forces, the latter being XPS’s

largest ever public sector client. We also completed the transition to

provide full administration services for the entire SEI Master Trust

from their previous supplier. We have continued to win new work with

insurance companies following the acquisition of Polaris in FY 2025.

Progress in FY 2026

Following the acquisition of UK insurance consultancy business

Polaris in FY 2025, the year under review was focused on

embedding the business within our Insurance Consulting division,

leveraging cross-selling opportunities and accelerating our

expansion into the UK insurance consulting market. In line with

this, insurers that were previously Polaris clients were seamlessly

transitioned into clients of the wider Group.

Priorities for FY 2027

• Prepare trustees and corporate sponsors for the introduction of a

new Pension Schemes Bill which is due to come into effect in 2027

• Help trustees of pension schemes and corporates evaluate

therelative merits of available options such as running on

andrisk transfer

Priorities for FY 2027

• Focus on operational and functional refinement of Aurora

inFY2027 and progressing the migration of clients from

ourfinal legacy system

• Leverage the 2025 acquisition of strategic consultancy Polaris

Actuaries and Consultants Ltd (“Polaris”) to expand the Group’s

service offerings in the insurance consulting market

• Continue to invest in AI-driven solutions to scale up our

platform and provide innovative solutions to clients

Priorities for FY 2027

• Grow our share of the risk transfer market

• Increase cross-selling opportunities across the business

• Pursue new mandates within Administration including first-time

outsourcing and public sector opportunities

Priorities for FY 2027

• Continue to evaluate potential opportunities that meet our

investment and strategic criteria

Key risk s

• Third-party supplier and outsourcing issues/errors, theft and

fraud and execution risk with our strategy

Key risks

• Strategic planning and execution, financial performance,

information/cyber security, human resources, client engagement

and business conduct and reputation

Key risks

• Strategic planning and execution, errors and third-party

supplier/outsourcing issues

Key risks

• Financial performance and business conduct and reputation,

strategic planning and execution

57%

Employers looking to

run their DB pension

schemes on for surplus

extraction

36%

Our clients who have

completed all stages of

GMP equalisation

670k

The total number of

members now on the

Aurora platform

The number of risk

transfer engagements

secured by the Group

during the year

Organic revenue growth

during the year

Our ranking in the

pension services fee

market in terms of

revenues

Acquisitions since

listingin 2017

£62m

Capital deployed

sinceFY 2018

Regulatory change

as a driver of activity

Growth through

expanding services

Read more in Principal risks and uncertainties on pages 43 to 50.

XPS Pensions Group plc Annual Report and Accounts 2026

Strategic report

Investing in our platform increases its scale and

functionality. Not only does this expand our best-in-

class service offering and capability; it also allows us to

grow our market share in both the £2.5 billion pension

scheme fee market and the £1.5 billion insurance

consulting fee market.

Our focus is to expand our offering and grow our

market share organically. Our strong balance sheet

also allows us to pursue inorganic growth

opportunities that match our investment criteria.

Growing market

Growth through

M&A

Regulatory change: The upcoming Pension Schemes Bill

The new Pension Schemes Bill aims to make it easier

for well-funded defined benefit schemes to run on,

enabling surpluses to be deployed for the benefit of

members and the sponsoring companies and for

growth in the wider economy to be facilitated.

When does it come into effect?

2027.

What does this mean for pension schemes?

Once the bill is in place, trustees and corporate

sponsors will require advice on what the best and

most appropriate long-term strategy for their

schemes will be.

How is XPS positioned?

Our full-service offering enables us to advise on all

the various options available, including “run-on-for-

surplus” and de-risking strategies.