5 Jul 2011 07:00
Immediate Release | 5 JULY 2011 |
Arden Partners plc
("Arden" or the "Group")
Interim results for the six months ended 30 April 2011
Arden Partners plc (AIM: ARDN.L), the institutional stockbroking company, today announces its unaudited interim results for the six month period ended 30 April 2011.
Highlights
·; Revenue increased by 14% to £7.4m (2010: £6.5m)
·; Profit before tax £1.2m (2010: Loss before tax £0.2m)
·; Underlying* profit before tax £1.5m (2010: £0.4m)
·; Basic profit per share 3.7p (2010: Loss per share 1.7p)
·; Underlying basic profit per share** 4.8p (2010: 0.9p)
·; Strong Balance Sheet underpinned by liquid resources
(* underlying profits are profits before share based payments and reorganisation costs of £0.3m pre-tax (2010: £0.7m))
(** underlying basic profit per share is basic profit per share adjusted for the post-tax effect of share based payments and reorganisation costs of £0.2m (2010: £0.6m))
Commenting on the interim results CEO Jonathan Keeling said:
"Trading results for May and June have been satisfactory, and Arden is engaged on a number of corporate finance mandates. I remain cautiously optimistic about continued improved results for 2010/2011 against a background of an encouraging pipeline of corporate transactions subject to timing and prevailing market conditions."
Arden Partners plc | 0207 614 5900 |
Jonathan Keeling - Chief Executive Officer |
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Trevor Norris - Group Finance Director |
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Altium - NOMAD to Arden Partners plc | 0207 484 4040 |
Phil Adams |
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Sam Fuller |
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Buchanan Communications | 0207 466 5000 |
Mark Edwards Nicola Cronk |
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CHIEF EXECUTIVE'S STATEMENT
Financial review
I am delighted to report a significant increase in profits in the half year ended 30 April 2011. Set out in the table below is the profit before taxation illustrating the effects of share based payments which are added back in arriving at underlying profits before taxation:
Six months ended 30 April 2011 Unaudited £'000 | Six months ended 30 April 2010 Unaudited £'000 | Year ended 31 October 2010 Audited £'000 | |
Revenue | 7,417 | 6,488 | 13,046 |
Expenses (excluding Share based payments) | (5,964) | (6,073) | (12,543) |
Trading profit | 1,453 | 415 | 503 |
Share based payments | (279) | (685) | (1,079) |
Profit/(loss) from operations | 1,174 | (270) | (576) |
Net finance income | 11 | 30 | 64 |
Profit/(loss) before taxation | 1,185 | (240) | (512) |
The UK business performance was satisfactory against a difficult market background and there was a strong performance from our Indian franchise where we have established an important position.
We continue to have a strong balance sheet underpinned by liquid resources which will stand the business in good stead in these challenging times for our industry.
Consolidated net assets are £13.3m before deduction of treasury shares (2010: £12.3m). At 30 April 2011 the Company holds in Treasury 2,372,768 Arden Partners plc ordinary shares of 10 pence each at a total cost of £1.2m. The price paid for these shares ranged between 49 pence and 54.5 pence per ordinary share.
During the six months period ended 30 April 2011 Arden was involved in placing over £155m for clients and directors and since the period end we have raised a further £54m.
The Board do not propose the payment of an interim ordinary dividend (2010: Nil).
Outlook
Trading results for May and June have been satisfactory, and Arden is engaged on a number of corporate finance mandates. I remain cautiously optimistic about continued improved results for 2010/2011 against a background of an encouraging pipeline of corporate transactions subject to timing and prevailing market conditions.
The UK franchise is a key element of Arden's business model and we will continue to invest in this area and seek to innovate and develop. The Company will continue to develop its Indian franchise and other emerging market opportunities.
On 14 June 2011 we announced the appointment of Lord Flight as Chairman. Howard had spent several months acting as Interim Chairman and I am delighted to be working with him, and the other Non-Executive Directors, in our strategy to deliver an increasingly profitable business.
As ever, company performance could not be delivered without the support and commitment of our staff and on behalf of the Board I would like to thank them all.
Jonathan Keeling
Chief Executive
5 July 2011
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the period ended 30 April 2011
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Six months ended 30 April 2011 Unaudited |
Six months ended 30 April 2010 Unaudited |
Year ended 31 October 2010 Audited | |
Note | £'000 | £'000 | £'000 | |
Revenue | 2 | 7,417 | 6,488 | 13,046 |
Administrative expenses | 3 | (6,243) | (6,758) | (13,622) |
Share based payments | (279) | (685) | (1,079) | |
Other expenses | (5,964) | (6,073) | (12,543) | |
Profit/(loss) from operations | 1,174 | (270) | (576) | |
Finance income | 13 | 31 | 73 | |
Finance cost | (2) | (1) | (9) | |
Profit/(loss) before taxation | 1,185 | (240) | (512) | |
Income tax | (319) | (185) | (519) | |
Profit/(loss) after taxation attributable to equity holders of the parent | 866 | (425) | (1,031) | |
Other comprehensive income: | ||||
Tax taken to equity | - | 23 | - | |
Other comprehensive income for the period (net of tax) | - | 23 | - | |
Total comprehensive income for the period | 866 | (402) | (1,031) | |
Earnings/(loss) per share | ||||
Basic | 4 | 3.7p | (1.7p) | (4.2p) |
Diluted | 4 | 3.5p | (1.7p) | (4.2p) |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION At 30 April 2011
| At 30 April 2011 Unaudited | At 30 April 2010 Unaudited | At 31 October 2010 Audited | |
£'000 | £'000 | £'000 | ||
Assets | ||||
Non-current assets | ||||
Plant, property and equipment | 312 | 513 | 401 | |
Deferred tax | 277 | 656 | 280 | |
Total non-current assets | 589 | 1,169 | 681 | |
Current assets | ||||
Trading investments | 5,831 | 4,111 | 3,207 | |
Trade and other receivables | 8,390 | 12,940 | 6,210 | |
Cash and cash equivalents | 6,318 | 3,087 | 9,014 | |
Total current assets | 20,539 | 20,138 | 18,431 | |
Total assets | 21,128 | 21,307 | 19,112 | |
Current liabilities | ||||
Trade and other payables | (8,701) | (8,127) | (6,895) | |
Corporation tax liability | (304) | (822) | (171) | |
Total current liabilities | (9,005) | (8,949) | (7,066) | |
Non-current liabilities | ||||
Deferred tax liability | - | (67) | (53) | |
Total non-current liabilities | - | (67) | (53) | |
Total liabilities | (9,005) | (9,016) | (7,119) | |
Net assets | 12,123 | 12,291 | 11,993 | |
Financed by: | ||||
Called up share capital | 2,679 | 2,536 | 2,544 | |
Share premium account | 2,933 | 2,894 | 2,926 | |
Employee Benefit Trust reserve | (612) | (648) | (648) | |
Profit and loss account | 8,316 | 7,509 | 7,171 | |
Total equity before deduction of own shares | 13,316 | 12,291 | 11,993 | |
Own shares | (1,193) | - | - | |
Total equity | 12,123 | 12,291 | 11,993 |
CONSOLIDATED STATEMENT OF CASH FLOWS For the period ended 30 April 2011 | Six months ended 30 April 2011 Unaudited | Six months ended 30 April 2010 Unaudited | Year ended 31 October 2010 Audited |
£'000 | £'000 | £'000 | |
Operating activities before taxation | |||
Net profit/(loss) from ordinary activities before tax | 1,185 | (240) | (512) |
Adjustments for: | |||
Fair value adjustments in respect of unrealised profits | (390) | (244) | (155) |
Depreciation | 101 | 112 | 236 |
Net interest receivable | (11) | (30) | (64) |
Share based payments | 279 | 685 | 1,079 |
Operating surplus before changes in working capital | 1,164 | 283 | 584 |
(Increase)/decrease in trade and other receivables | (2,146) | 2,757 | 9,439 |
(Increase) in trading investments | (2,233) | (1,290) | (400) |
Increase/(decrease) in trade and other payables | 1,808 | (9,008) | (10,266) |
Cash generated from operations | (1,407) | (7,258) | (643) |
Income taxes paid | (237) | (39) | (790) |
Cash flows from operating activities | (1,644) | (7,297) | (1,433) |
Investing activities | |||
Purchases of property, plant and equipment | (12) | (367) | (379) |
Interest received | 11 | 28 | 63 |
Net cash from investing activities | (1) | (339) | (316) |
Financing activities | |||
Purchase of own shares | (1,193) | - | - |
Issue of shares | 142 | 200 | 240 |
Net cash from financing activities | (1,051) | 200 | 240 |
Decrease in cash and cash equivalents | (2,696) | (7,436) | (1,509) |
Cash and cash equivalents at the beginning of the period | 9,014 | 10,523 | 10,523 |
Cash and cash equivalents at the end of the period | 6,318 | 3,087 | 9,014 |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the period ended 30 April 2011
Unaudited Statement of changes in equity for the six months ended 30 April 2011
Share Capital | Share Premium Account | Own shares | Employee Benefit Trust Reserve | Retained earnings | Total | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Balance at 31 October 2010 | 2,544 | 2,926 | - | (648) | 7,171 | 11,993 |
Changes in equity for period | ||||||
Total comprehensive income for the period | - | - | - | - | 866 | 866 |
Share based payments | - | - | - | - | 279 | 279 |
Issue of shares | 135 | 7 | - | - | - | 142 |
Purchase of own shares | - | - | (1,193) | - | - | (1,193) |
Sale of shares held by the Employee Benefit Trust | - | - | - | 36 | - | 36 |
Balance at 30 April 2011 | 2,679 | 2,933 | (1,193) | (612) | 8,316 | 12,123 |
Unaudited Statement of changes in equity for the six months ended 30 April 2010
Share Capital | Share Premium Account | Employee Benefit Trust Reserve | Retained earnings | Total | |
£'000 | £'000 | £'000 | £'000 | £'000 | |
Balance at 31 October 2009 | 2,494 | 2,736 | (648) | 7,226 | 11,808 |
Changes in equity for period | |||||
Total comprehensive income for the period | - | - | - | (402) | (402) |
Share based payments | - | - | - | 685 | 685 |
Issue of shares | 42 | 158 | - | - | 200 |
Balance at 30 April 2010 | 2,536 | 2,894 | (648) | 7,509 | 12,291 |
Notes to the Condensed Financial Statements
1) Basis of preparation
As permitted, IAS 34, 'Interim Financial Reporting' has not been applied in this interim report.
The financial information presented in this report has been prepared using accounting policies that are expected to be applied in the preparation of the financial statements for the year ending 31 October 2011.
These policies are in accordance with the recognition and measurement principles of International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively IFRS) issued by the International Accounting Standards Board as endorsed for use in the European Union, and these principles are disclosed in the Financial Statements for the year ended 31 October 2010.
The financial information in this interim report does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006.
The Annual Report and Financial Statements for 2010 have been filed with the Registrar of Companies. The Independent Auditors' Report on the Annual Report and Financial Statement for 2010 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.
2) Revenue
Six months ended 30 April 2011 Unaudited | Six months ended 30 April 2010 Unaudited | Year ended 31 October 2010 Audited | ||
£'000 | £'000 | £'000 | ||
Equities Division | 5,937 | 3,637 | 6,113 | |
Corporate Finance division | 1,480 | 2,851 | 6,933 | |
Total revenue | 7,417 | 6,488 | 13,046 | |
3) Administrative expenses
Six months ended 30 April 2011 Unaudited | Six months ended 30 April 2010 Unaudited | Year ended 31 October 2011 Audited | |
£'000 | £'000 | £'000 | |
Staff costs including incentive scheme | 3,116 | 3,247 | 6,385 |
Other overheads including exceptional charges | 1,989 | 2,217 | 4,920 |
Staff and overhead costs | 5,105 | 5,464 | 11,305 |
Share based payments | 279 | 685 | 1,079 |
Depreciation | 101 | 112 | 236 |
Total overhead costs | 5,485 | 6,261 | 12,620 |
Variable overheads including settlement costs | 758 | 497 | 1,002 |
Total administrative costs | 6,243 | 6,758 | 13,622 |
4) Profit per share
The basic profit per share of 3.7p (2010: basic loss per share 1.7p) is calculated on a profit after tax of £866,000 (2010: loss after tax £425,000) and 23,143,927 (2010: 24,467,440) being the weighted average number of ordinary shares in issue during the period.
Diluted profit per share takes account of the weighted average number of outstanding share options being 1,557,827. In respect of the comparative for the six months ended 30 April 2010, no adjustment has been made to the diluted loss per share of 1.7p as the dilution effect of the weighted average number of outstanding share options of 3,266,576 would be to decrease the loss per share.
The underlying basic profit per share of 4.8p (2010: 0.9p) for the six months ended 30 April 2011 is calculated on a profit after tax of £1,114,000 (2010: £221,000) being the result after tax, adjusted for the post tax impact of IFRS 2 costs of £248,000 (2010: £646,000).
5) Dividends
The Board has not declared an interim dividend (2010: Nil).
INDEPENDENT REVIEW REPORT TO ARDEN PARTNERS PLC
Introduction
We have been engaged by the group to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 April 2011 which comprises the consolidated statement of comprehensive income, the consolidated statement of financial position, the consolidated statement of cash flows, the consolidated statements of changes in equity and the related explanatory notes that have been reviewed.
We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.
Directors' responsibilities
The interim report, including the financial information contained therein, is the responsibility of and has been approved by the directors. The directors are responsible for preparing the interim report in accordance with the rules of the London Stock Exchange for companies trading securities on AIM which require that the half-yearly report be presented and prepared in a form consistent with that which will be adopted in the group's annual accounts having regard to the accounting standards applicable to such annual accounts.
Our responsibility
Our responsibility is to express to the group a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.
Our report has been prepared in accordance with the terms of our engagement to assist the group in meeting the requirements of the rules of the London Stock Exchange for companies trading securities on AIM and for no other purpose. No person is entitled to rely on this report unless such a person is a person entitled to rely upon this report by virtue of and for the purpose of our terms of engagement or has been expressly authorised to do so by our prior written consent. Save as above, we do not accept responsibility for this report to any other person or for any other purpose and we hereby expressly disclaim any and all such liability
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, ''Review of Interim Financial Information Performed by the Independent Auditor of the Entity'', issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 April 2011 is not prepared, in all material respects, in accordance with the rules of the London Stock Exchange for companies trading securities on AIM.
BDO LLP
Chartered Accountants and Registered Auditors
London
United Kingdom
5 July 2011
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).