Frp Advisory Group Regulatory News (FRP)

11 November 2021

FRP Advisory Group plc

("FRP" or the "Group")

Half Year Trading Update

FRP Advisory Group plc, a leading UK professional services firm specialising in advisory services, today announces a trading update for the half year ended 31 October 2021 (H1 2022).

Trading performance

The Group delivered another strong performance during the first half, continuing to grow revenue and underlying adjusted EBITDA.

The Corporate Finance market remains busy as pent-up capital continues to be deployed. FRP Corporate Finance, including Debt Advisory, was enlarged last year by two acquisitions and the team have been very active, advising on 50 transactions in H1 with a combined deal value of £1.28bn and £0.5bn of debt raised. Three notable transactions in H1 include:

- Sell side adviser to Solent Global, a provider of branded, licensed and white label products to the consumer sector, in their £117m merger with the Swedish FMCG powerhouse Humble Group.

- Sell side adviser to Timberwolf, a manufacturer of a broad range of commercial wood chippers, in their sale to Alamo Group

- Sell side adviser to Insurtech firm Ignite Software Solutions on their sale to Sequel, owned by the Nasdaq listed data analytics group, Verisk.

The Corporate Finance team have a strong transactional pipeline for H2.

The Restructuring market has seen liquidation activity return to pre-pandemic levels but extended Government support has meant the administration market, where FRP has a significant market share, remains subdued.

The Group expects to report revenue for the half year to 31 October 2021 of £44.7m, up 25% on the prior year (H1 2021: £35.9m), and underlying adjusted EBITDA* of £11.1m, up 14% on the prior year (H1 2021: £9.7m), in line with the Board's expectations to date.

*Underlying adjusted EBITDA removes non-cash costs including share based payments relating to deemed remuneration arising on acquisitions that is subject to continuing employment and the Employee Incentive Plan established on IPO and funded by partners, so no dilution to existing shareholders.

Balance sheet and liquidity

The Group's balance sheet remains strong with an unaudited net cash balance as at 31 October 2021 of £9.2m** (H1 2021: £15.4m). The Group also continues to have an undrawn revolving credit facility of £10m.

**£16.8m gross cash less £7.6m of structured debt, repayable over approximately four years.

People and operations

FRP's 22 offices in the UK continue to work well together, drawing on specialists from different service lines as necessary, in order to deliver the best possible service and outcome.

We continued to grow our headcount, with total Colleagues up 11% over H1 (via demand-led lateral hires) and 18% year-on-year (via both demand-led lateral hires and acquired Colleagues that came with the Spectrum Corporate Finance Ltd acquisition) .

In H1, two new London Partner hires included Simon Stibbons, a Restructuring Partner specialising in Government projects and Jim Davies, a Valuations specialist who joined our Corporate Finance team. Harry Walker, a Leicester based Corporate Financier was an internal promotion to Partner in H1.

On 1 November 2021 two new Partners joined FRP. Dan Bowtell joined our Corporate Finance team and will be based in a new FRP Cambridge office, while Henry Pocock joined our Birmingham office as a Forensic Services Partner. Our new Glasgow office is expected to open in late November 2021.

The Group has also started to execute several key system upgrades and changes as part of a plan to further improve operational efficiency and enhance internal controls. These changes are expected to conclude in late 2022.

Notice of results

The Group expects to report its unaudited results for the half year ended 31 October 2021 on 16 December 2021.

Geoff Rowley, Chief Executive Officer of FRP Advisory Group plc, said:

"We delivered another pleasing performance in the first half, continuing to execute our strategy to grow the business. The markets we operate in have been mixed. The Corporate Finance market is highly active as capital continues to be deployed. However, the extension of Government support over most of H1 has resulted in Restructuring administration activity remaining subdued. 

Looking ahead, we are well positioned to service the expected increase in Restructuring Advisory activity driven by: the withdrawal of Government support, supply chain disruption and rising input costs from energy, wages and raw materials. Our Corporate Finance team have a strong pipeline and are well positioned to continue helping clients realise their strategic ambitions.

The medium-term outlook for all our markets is positive and the Board remains confident of making further progress in the current financial year."

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the UK version of the EU Market Abuse Regulation (2014/596) which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended and supplemented from time to time. 

Enquiries:

FRP Advisory Group plc

Geoff Rowley, CEO

Jeremy French, COO

Gavin Jones, CFO

Enquiries via MHP

Cenkos Securities plc (Nominated Adviser and Sole Broker)

Katy Birkin/Max Gould (Corporate Finance)

Alex Pollen (Sales)

Tel: +44 (0) 207 397 8900

MHP Communications (Financial Public Relations)

Oliver Hughes

Charlie Barker

Pete Lambie

Tel: +44 (0) 3128 8540 / +44 (0) 20 3128 8570

FRP@mhpc.com 

Notes to Editors

FRP is a professional services firm established in 2010 which offers a range of advisory services to companies, lenders, investors and other stakeholders, as well as individuals. These services include:

· Restructuring advisory: corporate financial advisory, formal insolvency appointments, informal restructuring advisory, personal insolvency and general advice to all stakeholders.

· Corporate finance: mergers & acquisitions (M&A), strategic advisory and valuations, financial due diligence, capital raising, special situations M&A and partial exits.

· Debt advisory: raising and refinancing debt, debt amendments and extensions, restructuring debt, asset based lending and corporate and leveraged debt advisory.

· Forensic services: forensic investigations, compliance and risk advisory, dispute services and forensic technology.

· Pensions advisory: pension scheme transaction advisory, pension scheme restructuring advisory, covenant advisory and corporate governance