Liontrust Asset Management Regulatory News (LIO)

Process

Total

Institutional

UK Retail

Multi-Asset

Offshore

(£m)

(£m)

(£m)

(£m)

(£m)

Sustainable Investment

13,243

151

12,203

0

889

Economic Advantage

10,116

469

9,168

0

479

Multi-Asset

7,357

0

0

7,357

0

Global Equity

3,060

195

2,865

0

0

Cashflow Solution

1,032

689

289

0

54

Global Fixed Income

851

0

367

0

484

Total

35,659

1,504

24,892

7,357

1,906

Total

Institutional

UK Retail

Multi-Asset

Offshore

(£m)

(£m)

(£m)

(£m)

(£m)

Opening AuMA - 1 April 2021

30,929

1,488

20,627

7,139

1,675

Net flows

2,088

(63)

2,038

(26)

139

Market and Investment performance

2,642

79

2,227

244

92

Closing AuMA - 30 September 2021

35,659

1,504

24,892

7,357

1,906

Quartile ranking - Since Launch/Manager Appointed

Quartile ranking - 5 year

Quartile ranking - 3 year

Quartile ranking - 1 year

Launch Date/ Manager Appointed

Economic Advantage funds

Liontrust UK Growth Fund

1

2

2

3

25/03/2009

Liontrust Special Situations Fund

1

1

1

3

10/11/2005

Liontrust UK Smaller Companies Fund

1

1

1

3

08/01/1998

Liontrust UK Micro Cap Fund

1

1

1

1

09/03/2016

Sustainable Future funds

Liontrust Monthly Income Bond Fund

2

1

3

1

12/07/2010

Liontrust SF Managed Growth Fund

1

1

1

2

19/02/2001

Liontrust SF Corporate Bond Fund

1

1

2

1

20/08/2012

Liontrust SF Cautious Managed Fund

1

1

1

3

23/07/2014

Liontrust SF Defensive Managed Fund

1

1

1

3

23/07/2014

Liontrust SF European Growth Fund

1

1

1

2

19/02/2001

Liontrust SF Global Growth Fund

2

1

1

3

19/02/2001

Liontrust SF Managed Fund

1

1

1

1

19/02/2001

Liontrust UK Ethical Fund

2

1

1

2

01/12/2000

Liontrust SF UK Growth Fund

2

1

1

2

19/02/2001

Global Equity funds1

Liontrust Balanced Fund

1

1

1

4

31/12/1998

Liontrust China Fund

3

3

3

3

31/12/2004

Liontrust Emerging Market Fund

3

3

3

3

30/09/2008

Liontrust Global Smaller Companies Fund

1

1

1

2

01/07/2016

Liontrust Global Alpha Fund

1

1

1

1

31/12/2001

Liontrust Global Dividend Fund

2

1

1

2

20/12/2012

Liontrust Global Innovation Fund

1

1

1

4

31/12/2001

Liontrust Global Technology Fund

3

2

3

3

15/12/2015

Liontrust Income Fund

1

1

2

4

31/12/2002

Liontrust Japan Equity Fund

2

3

2

3

22/06/2015

Liontrust US Opportunities Fund

1

1

2

1

31/12/2002

Cashflow Solution funds

Liontrust European Growth Fund

1

1

1

1

15/11/2006

Global Fixed Income funds

Liontrust Strategic Bond Fund

3

- 

3

3

08/05/2018

Consolidated Statement of Comprehensive Income

Six months ended 30 September 2021

Six

Six

Year

months to

months to

ended

30-Sep-21

30-Sep-20

31-Mar-21

(unaudited)

(restated and unaudited)

(audited)

Notes

£'000

£'000

£'000

Revenue*

4

114,893

69,082

175,080

Cost of sales*

4

(6,348)

(6,026)

(11,321)

Gross profit

108,545

63,056

163,759

Realised profit on sale of financial assets

50

-

250

Unrealised gain on financial assets

-

316

672

Administration expenses

5

(77,486)

(56,436)

(129,646)

Operating profit

31,109

6,936

35,035

Interest receivable

3

4

7

Interest payable

(49)

(66)

(113)

Profit before tax

31,063

6,874

34,929

Taxation **

7

(4,852)

(1,588)

(7,257)

Profit for the period

26,211

5,286

27,672

Other comprehensive income

-

-

-

Total comprehensive income

26,211

5,286

27,672

Pence

Pence

Pence

Basic earnings per share

8

43.27

9.21

47.02

Diluted earnings per share

8

42.72

9.00

46.25

All of the results are derived from continuing operations.

The accompanying notes form an integral part of these unaudited condensed interim financial statements.

* The revenue of the six months to 30 September 2020 has been restated to reflect rebates being reclassified as a reduction in revenue rather than a cost of sales (see note 1d). This restatement has no impact on Gross profit, nor on net asset balances.

** The tax charge for the six months to 30 September 2020 has been restated to reflect deferred taxation on the share option charge that was not previously recognised (see note 1d).

Consolidated Balance Sheet

As at 30 September 2021

30-Sep-21

30-Sep-20

31-Mar-21

(unaudited)

(restated and unaudited)

(audited)

Notes

£'000

£'000

£'000

Assets

Non current assets

Intangible assets

9

79,992

36,565

84,812

Goodwill

10

27,577

19,626

27,577

Property, plant and equipment

5,346

6,875

5,257

112,915

63,066

117,646

Current assets

Trade and other receivables

11

240,935

186,119

289,805

Financial assets

12

4,107

1,859

2,188

Cash and cash equivalents

82,837

98,602

71,898

Total current assets

327,879

286,580

363,891

Liabilities

Non current liabilities

Deferred tax liability *

(12,467)

(4,599)

(13,436)

Lease liability

(5,024)

(6,668)

(3,418)

Total non current liabilities

(17,491)

(11,267)

(16,854)

Current liabilities

Trade and other payables

(252,314)

(190,679)

(298,007)

Corporation tax payable

(1,853)

(1,314)

(3,288)

Total current liabilities

(254,167)

(191,993)

(301,295)

Net current assets

73,712

94,587

62,596

Net assets

169,136

146,386

163,388

Shareholders' equity

Ordinary shares

611

606

610

Share premium

64,370

121,809

64,370

Capital redemption reserve

19

19

19

Retained earnings *

109,626

29,142

104,207

Own shares held

(5,490)

(5,190)

(5,818)

Total equity

169,136

146,386

163,388

The accompanying notes form an integral part of these unaudited condensed interim financial statements.

The unaudited condensed interim financial statements were approved by the Board of Directors on 30 November 2021 and signed on their behalf by: Vinay Abrol

* The 30 September 2020 deferred taxation and retained earnings have been restated to reflect deferred taxation on the share option charge that was not previously recognised (see note 1d).

Consolidated Cash Flow Statement

Six months ended 30 September 2021

Six

Six

Year

months to

months to

ended

30-Sep-21

30-Sep-20

31-Mar-21

(unaudited)

(unaudited)

(audited)

£'000

£'000

£'000

Cash flows from operating activities

Cash inflow from operations

114,775

74,765

141,409

Cash outflow from operations*

(71,972)

(70,046)

(95,913)

Cash inflow from changes in unit trust receivables and payables

1,453

2,357

4,554

Net cash generated from operations*

44,256

7,076

50,050

Interest received

3

4

7

Tax paid

(7,500)

(1,316)

(6,416)

Net cash from operating activities

36,759

5,764

43,641

Cash flows from investing activities

Purchase of property, plant and equipment

(310)

(99)

(254)

Acquisition of Architas net of cash required

-

-

(54,124)

Purchase of financial assets

(3,124)

-

-

Sale of financial assets

-

1,334

1,334

Purchase of seeding investments

(34)

(47)

(117)

Net cash (used in) / from investing activities

(3,468)

1,188

(53,161)

Cash flows from financing activities

Payment of lease liabilities*

(839)

(1,044)

(2,263)

Purchase of own shares

-

-

(812)

Sale of own shares

328

672

852

Issue of shares

-

66,170

64,421

Dividends paid

(21,841)

(14,442)

(21,074)

Net cash (used in) / from financing activities*

(22,352)

51,356

41,124

Net increase in cash and cash equivalents

10,939

58,308

31,604

Opening cash and cash equivalents

71,898

40,294

40,294

Closing cash and cash equivalents

82,837

98,602

71,898

 Cash and cash equivalents consist only of cash balances.

The accompanying notes form an integral part of these unaudited condensed interim financial statements.

* The cash flow statement to 30 September 2020 has been represented to show the payment of lease liabilities as an item in financing activities rather than in operating activities in accordance with IAS7.

Consolidated Statement of Change in Equity (unaudited)

Six months ended 30 September 2021

Share

Share

Capital

Retained

Own shares

Total

capital

premium

redemption

earnings

held

Equity

£ '000

£ '000

£ '000

£ '000

£ '000

£ '000

Balance at 1 April 2021 brought forward

610

64,370

19

104,207

(5,818)

163,388

Profit for the period

-

-

-

26,211

-

26,211

Total comprehensive income for the period

-

-

-

26,211

-

26,211

Dividends paid

-

-

-

(21,841)

-

(21,841)

Shares issued

1

-

-

(1)

-

-

Sale of own shares

-

-

-

-

328

328

Equity share options issued

-

-

-

1,541

-

1,541

Equity share options settled

-

-

-

(244)

-

(244)

Deferred tax on option charge taken to equity

-

-

-

(247)

-

(247)

Balance at 30 September 2021

611

64,370

19

109,626

(5,490)

169,136

Consolidated Statement of Change in Equity (unaudited and restated)

Six months ended 30 September 2020

Share

Share

Capital

Retained

Own shares

Total

capital

premium*

redemption

earnings*

held

Equity

£ '000

£ '000

£ '000

£ '000

£ '000

£ '000

Balance at 1 April 2020 brought forward*

555

57,439

19

37,888

(5,862)

90,039

Profit for the period

-

-

-

5,286

-

5,286

Total comprehensive income for the period

-

-

-

5,286

-

5,286

Dividends paid

-

-

-

(14,442)

-

(14,442)

Shares issued

51

64,370

-

-

-

64,421

Sale of own shares

-

-

-

-

672

672

Equity share options issued

-

-

-

823

-

823

Equity share options issued settled

-

-

-

(532)

-

(532)

Deferred tax on option charge taken to equity*

-

-

-

119

-

119

Balance at 30 September 2020

606

121,809

19

29,142

(5,190)

146,386

Consolidated Statement of Change in Equity (audited)

Year ended 31 March 2021

Ordinary

Share

Capital

Retained

Own shares

Total

shares

premium

redemption

earnings

held

Equity

£ '000

£ '000

£ '000

£ '000

£ '000

£ '000

Balance at 1 April 2020 brought forward *

555

57,439

19

37,888

(5,862)

90,039

Profit for the year

-

-

-

27,672

-

27,672

Total comprehensive income for the year

-

-

-

27,672

-

27,672

Dividends paid

-

-

-

(21,074)

-

(21,074)

Capital reorganisation

-

(57,439)

-

57,439

-

-

Shares issued

55

64,370

-

-

-

64,425

Sale/(purchase) of own shares

-

-

-

-

44

44

Equity Share options issued

-

-

-

2,636

-

2,636

Equity share options settled

-

-

-

(518)

-

(518)

Deferred tax on option charge taken to equity

-

-

-

164

-

164

Balance at 31 March 2021

610

64,370

19

104,207

(5,818)

163,388

The accompanying notes form an integral part of these unaudited condensed interim financial statements.

* The 1 April 2020 opening balance has been restated to reflect the historic deferred taxation on share options charge that was not previously recognised (see note 1d)

1

Principal Accounting policies

a)

Basis of preparation

The Group financial information for the six months ended 30 September 2021 has been prepared in accordance with the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority and with IAS 34 Interim Financial Reporting. This condensed set of financial statements has been prepared applying the accounting policies and presentation that were applied in the preparation of the Group's published consolidated financial statements for the year ended 31 March 2021. These are consistent with IFRSs issued by the International Accounting Standards Board as adopted by the UK Endorsement Board for use in the United Kingdom.

This Half Yearly Report is unaudited and does not constitute statutory accounts within the meaning of s434 of the Companies Act 2006. The financial information for the half years ended 30 September 2021 and 2020 has not been audited by the auditors pursuant to the Auditing Practices Board guidance on Review of Interim Financial Information. Therefore, these half year accounts should be read in conjunction with the statutory accounts for the year ended 31 March 2021, which were prepared in accordance with International Financial Reporting Standards, which comprise standards and interpretations issued by either the International Accounting Standards Board or the IFRS Interpretations Committee or their predecessors as adopted by the European Union ('IFRS') adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union, those parts of the Companies Act 2006 applicable to companies reporting under IFRS; and in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 ("Adopted IFRS"). KPMG reported on the 31 March 2021 financial statements, and their report was unmodified and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006 in the UK.

The preparation of financial statements in conformity with IFRS requires the directors of the Company to make significant estimates and judgements that affect the reported amounts of assets and liabilities and disclosure of contingencies at the date of the financial information and the reported income and expense during the reporting periods. Although these judgements and assumptions are based on the directors' best knowledge of the amount, events or actions, actual results may differ from these estimates. The accounting policies set out below have been used to prepare the financial information. All accounting policies have been consistently applied.

b)

Going concern

The financial information presented within these financial statements has been prepared on a going concern basis under the historical cost convention (except for the measurement of financial assets at fair value through profit and loss and DBVAP liability which are held at their fair value). The Group is reliant on cash generated by the business to fund its working capital. The Directors have assessed the prospects of the Group and parent company over the forthcoming 12 months, including an assessment of current trading; budgets, plans and forecasts; the adequacy of current financing arrangements; liquidity, cash reserves and regulatory capital; and potential material risks to these forecasts and the Group strategy. This assessment includes a review of the ongoing impact of the Covid-19 pandemic on the business; and consideration of a severe but plausible downside scenario in which AuMA falls due to a market event by 20%. The Directors confirm that as a result of this assessment they have a reasonable expectation that the Group and parent company will continue to operate and meet its liabilities as they fall due for at least 12 months from the date of signing these accounts.

c)

Accounting estimates and judgements

The preparation of the financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies. Estimates and judgements used in preparing the financial statements are periodically evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable. The resulting accounting estimates may not equal the related actual results. There are no significant judgements. The estimates and assumptions that have a significant effect on the carrying amounts of assets and liabilities are set out as follows:

(i) Impairment of Goodwill

Goodwill arising on acquisitions is capitalised in the consolidated balance sheet. Goodwill is carried at cost less provision for impairment. The carrying value of goodwill is not amortised but is tested annually for impairment or more frequently if any indicators of impairment arise. Goodwill is allocated to a cash generating unit (CGU) for the purpose of impairment testing, with the allocation to those CGUs that are expected to benefit from the business combination in which the goodwill arose (see note 14 of the Financial Statements to 31 March 2021).

Impairment losses on goodwill, where these are identified, are not reversed. Impairment is tested through measuring the recoverable amount against the carrying value of the related goodwill. The recoverable amount is the higher of the fair value less costs to sell the CGU and its value in use. Value in use is assessed using a multi-period excess earnings model which requires a number of inputs requiring management estimates and judgements, the most significant of which are: future business performance and growth (including fund sales, redemptions and market growth), operating costs, synergies, and the cost of capital/discount rate.

Due to the strong performance and growth of the Sustainable Investment team (acquired as part of the ATI acquisition) and the Global Equity team (acquired as part of the Neptune acquisition) there is no significant estimation in relation to the impairment of the related goodwill allocated to the Sustainable and Global Equity Investment teams' CGU. Due to the relatively recent acquisition of the Archtias UK Investment Business (Multi-Asset team CGU) and development of the Multi-Asset team products, goodwill and its impairment is a significant estimate therefore in relation to the Architas intangible (Multi-Asset team CGU).

(ii) Impairment of intangible assets

Details of the impairment policy for intangible assets and their estimated useful lives can be found in note 1h) of the Financial Statements to 31 March 2021.

Due to the relatively recent acquisition of Architas (Multi-Asset team CGU) and development of the Multi-Asset team products, intangible impairment is a significant estimate in relation to the Architas intangible Asset (Multi-Asset team CGU).

d

Restatement

The 30 September 2020 financial statements have been restated to reflect:

(1) the corrected treatment of the deferred tax asset arising from the issue of employee share options due to the timing difference between the service period and the future tax deduction when the options are exercised. The restatement increased opening deferred tax assets and retained earnings at 1 April 2019 by£990,000. In the year ended 31 March 2020 the restatement increased deferred tax assets by a further £489,000 to £1,479,000, with £237,000 crediting retained earnings and £252,000 crediting taxation in the Statement of Comprehensive Income. The restatement increased profit and total comprehensive income for the year ended 31 March 2020 by £252,000 to £13,216,000 and increased net assets at 31 March 2020 by £1,479,000 to £90,039,000. The Statement of Comprehensive Income, Balance sheet, Statement of Changes in Equity and related notes were updated to reflect this restatement; and

(2) contractual rebates due to customers being reclassified as a reduction in revenue rather than a cost of sales (see note 4) as they do not represent a payment for distinct goods or services. This restatement reduced revenue and cost of sales by £15,209,000 and has no impact on Gross profit, total profit, total comprehensive income for the year ended 31 March 2020 or net assets at 31 March 2020 and does not impact brought forward reserves at 1 April 2020.

These restatements do not have an impact on basic and diluted earnings per share.

The accounting policies applied in this Half Yearly Report are consistent with those applied in the Group's most recent annual accounts.

2

Alternative Performance measures

The Group assess its performance using a variety of measures that are not defined under IFRS and are therefore termed alternative performance measures ('APMs'). The APMs that we use may not be directly comparable with similarly named measures used by other companies.

The Group uses the APM's to present its financial performance, in a manner which is aligned with the requirements of our stakeholders. By presenting these APM's it enables comparison with our peers who may use different accounting policies.

The Group uses the following APMs:

Alternative Performance Measure

Definition

Reconciliation

Adjusted profit before tax

Profit before taxation, depreciation, amortisation, net IFRS16 finance costs, share incentivisation expenses and non-recurring items*

Note 6

This is used to present a measure of profitability of the Group which is aligned to the requirements of shareholders, potential shareholders and financial analysts, and which removes the effects of financing and capital investment, which eases the comparison with the Group's competitors who may use different accounting policies and financing methods.Specifically, calculation of Adjusted profit before tax excludes share incentivisation expenses for similar reasons to above, and in particular provides shareholders, potential shareholders and financial analysts a consistent year on year basis of comparison of a "profit before tax number", when comparing the current year to the previous year and also when comparing multiple historical years to the current year, of how the underlying business is performing without the effects of share incentivisation expenses which can be influenced by other factors such as timing of grants due to prohibited periods, shareholder approval of share incentivisation plans, and other factors.

Adjusted operating profit

Profit before interest, depreciation and amortisation, share incentivisation expenses and non-recurring items*

Note 6

This is used to present a measure of profitability of the Group which is aligned to the requirements of shareholders, potential shareholders and financial analysts, and which removes the effects of financing and capital investment, which eases the comparison with the Group's competitors who may use different accounting policies and financing methods. Specifically, calculation of Adjusted operating profit before tax excludes share incentivisation expenses for similar reasons to above, and in particular provides shareholders, potential shareholders and financial analysts a consistent year on year basis of comparison of a "profit before tax number", when comparing the current year to the previous year and also when comparing multiple historical years to the current year, of how the underlying business is performing without the effects of share incentivisation expenses which can be influenced by other factors such as timing of grants due to prohibited periods, shareholder approval of share incentivisation plans, and other factors.

Gross profit excluding performance fees

Gross profit less any revenue attributable toperformance related fees.

Note 4

This is used to present a consistent year on year measure of revenues within the business, removing the element of revenue that may fluctuate year on year.

Adjusted earnings per share

Adjusted profit before tax divided by the weighted average number of shares in issue for the period

n/a

This is used to present a measure of profitability per share in line with the adjusted operating profit as detailed above.

Adjusted diluted earnings per share

Adjusted profit before tax divided by the diluted weighted average number of shares in issue for the period

n/a

This is used to present a measure of profitability per share in line with the adjusted operating profit as detailed above.

*Non-recurring items include acquisition related and associated restructuring costs, and severance compensation related expenses.

3

Segmental reporting

The Group operates only in one business segment - Investment management.

The Group offers different fund products through different distribution channels. All financial, business and strategic decisions are made centrally by the Board, which determines the key performance indicators of the Group. The Group reviews financial information presented at a Group level. The Board, is therefore, the chief operating decision-maker for the Group. The information used to allocate resources and assess performance is reviewed for the Group as a whole. On this basis, the Group considers itself to be a single-segment investment management business.

4

Revenue

Six

Six

Year

months to

months to

ended

30-Sep-21

30-Sep-20

31-Mar-21

(unaudited)

(unaudited)

(audited)

£'000

£'000

£'000

Revenue

 - Revenue *

114,893

69,082

161,388

 - Performance fee revenue

-

-

13,692

Total Revenue

114,893

69,082

175,080

Cost of sales *

(6,348)

(6,026)

(11,321)

Gross Profit

108,545

63,056

163,759

* Following a review, Management Fees are shown net of contractual rebates with customers, see note 1d.

Revenue from earnings includes:

- Investment management on unit trusts, open-ended investment companies sub-funds, portfolios and segregated account.

- Performance fees on unit trusts, open-ended investment companies sub-funds, portfolios and segregated accounts.

- Fixed administration fees on unit trusts and open-ended investment companies sub-funds.

- Net value of sales and repurchases of units in unit trusts and shares in open-ended investment companies (net of discounts).

- Net value of liquidations and creations of units in unit trusts and shares in open-ended investment companies sub-fund.

- Box profits on unit trusts - the "at risk" trading profit or loss arising from changes in the valuation of holdings of units in Group Unit Trusts to help manage client sales into, and redemptions from the trust.

- Foreign currency gains and losses.

- Less contractual rebates paid to customers.

The cost of sales includes:

- Operating expenses including (but not limited to) keeping a record of investor holdings, paying income, sending annual and interim reports, valuing fund assets and calculating prices, maintaining fund accounting records, depositary and trustee oversight and auditors.

- Sales commission paid or payable to third parties.

- External investment advisory fees paid or payable.

5

Administration expenses

Six

Six

Year

months to

months to

ended

30-Sep-21

30-Sep-20

31-Mar-21

(unaudited)

(unaudited)

(audited)

£'000

£'000

£'000

Employee related expenses

Wages and salaries

20,060

11,710

25,817

Social security costs

2,864

3,508

Pension costs

866

656

1,480

Share incentivisation expense

2,974

2,049

4,693

DBVAP expense (1)

1,344

856

1,656

Severance compensation

4

214

1,793

28,112

15,485

38,947

Non-employee related expenses

Members' drawings charged as an expense

24,314

16,387

41,986

Members' share incentivisation expense

971

1,045

1,471

Members' severance

114

Professional services(2)

3,255

10,047

15,025

Depreciation and Intangible asset amortisation

5,779

2,429

7,448

Other administration expenses

14,941

11,043

24,769

Total administration expenses

77,486

56,436

129,646

(1) For the financial year ended 31 March 2021 (going forward) management have reviewed their assessment of adjustments and have removed the DBVAP expense and the share incentive plan expense from its adjusted profit measure.

(2) Includes acquisition related and restructuring costs for the Architas and Neptune.

6

Adjusted profit before tax

Adjusted profit before tax is reconciled in the table below:

Six

Six

Year

months to

months to

ended

30-Sep-21

30-Sep-20

31-Mar-21

(unaudited)

(unaudited)

(audited)

£'000

£'000

£'000

Profit before tax for the period

31,063

6,874

34,929

Share incentivisation expense

3,734

3,094

5,776

Unrealised (Gain) on DBVAP asset

-

-

(525)

DBVAP expense net of gain(1)

-

540

-

Severance compensation

118

214

1,793

Net IFRS 16 finance costs

(821)

(902)

112

Gain on sale of Asia Income Fund

-

-

(250)

Professional services(2)

3,255

10,047

15,025

Depreciation, Intangible asset amortisation and impairment

5,779

2,429

7,448

Adjustments

12,065

15,422

29,379

Adjusted profit before tax

43,128

22,296

64,308

Interest receivable

(3)

(4)

(7)

Interest payable

-

-

-

Adjusted operating profit

43,125

22,292

64,301

Adjusted basic earnings per share

57.67

31.46

88.52

Adjusted diluted earnings per share

56.94

30.74

87.06

(1) For the financial year ended 31 March 2021 ( and going forward) management have reviewed their assessment of adjustments and have removed the DBVAP expense and the share incentive plan expense from its adjusted profit measure.

(2) Includes acquisition related and restructuring costs for Architas/Neptune.

7

Taxation

The half year tax charge has been calculated at the estimated full year effective UK corporation tax rate of 19% (30 September 2020: 19%).

8

Earnings per share

The calculation of basic earnings per share is based on profit after taxation and the weighted average number of Ordinary Shares in issue for each period. The weighted average number of Ordinary Shares for the six months ended 30 September 2021 was 60,570,438 (30 September 2020 57,406,615; 31 March 2021: 58,846,929). Shares held by the Liontrust Asset Management Employee Trust are not eligible for dividends and are treated as cancelled for the purposes of calculating earnings per share.

Diluted earnings per share is calculated on the same bases as set out above, after adjusting the weighted average number of Ordinary Shares for the effect of options to subscribe for new Ordinary Shares that were in existence during the six months ended 30 September 2021. The adjusted weighted average number of Ordinary Shares so calculated for the period was 61,356,243 (30 September 2020: 58,757,394; 31 March 2021: 59,831,128). This is reconciled to the actual weighted number of Ordinary Shares as follows:

30-Sep-21

30-Sep-20

31-Mar-21

Weighted average number of Ordinary Shares

60,570,438

57,406,615

58,846,929

Weighted average number of dilutive Ordinary shares under option:

 - to Liontrust Long Term Incentive Plan

757,386

1,323,491

959,895

 - to the Liontrust CSOP

28,419

27,288

24,304

Adjusted weighted average number of Ordinary Shares

61,356,243

58,757,394

59,831,128

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Intangible assets

Intangible assets represent investment management contracts that have been capitalised upon acquisition and are amortised on a straight-line basis over a period of 10 years. The intangible asset on the balance sheet represents investment management contracts as follows:

30-Sep-21

30-Sep-20

31-Mar-21

£'000

£'000

£'000

Investment management contracts acquired from ATI

6,600

7,800

7,200

Investment management contracts acquired from Neptune

24,223

28,765

25,737

Investment management contracts acquired from Architas

49,168

-

51,874

79,991

36,565

84,811

10

Goodwill

Goodwill is allocated to the CGU to which it relates as the underlying funds acquired in each business acquisition are clearly identifiable to the ongoing investment team that is managing them. The ATI Goodwill on acquisition is allocated to the Sustainable Funds team CGU and at 30 September 2021 was £11,873,000 (2020: £11,873,000). At 31 March 2021 an assessment was made in relation to impairment of the goodwill where the recoverable amount, based on a value in use, was calculated using an earnings model which used key assumptions such as the discount rate (12.8%, 2020: 13.0%), terminal growth rate (2%, 2020: 2%) and net AuMA growth (5%, 2020: 5%). Sensitivity analysis was carried out on this model which significantly reduced the forecast net AuMA growth. These changes in estimates would not lead to any impairment in the carrying value of this goodwill.

The Neptune Goodwill on acquisition is allocated to the Global Equities team CGU and at 30 September 2021 was £7,753,000 (2020: £7,753,000). At 31 March 2021 an assessment was made in relation to impairment of the goodwill where the recoverable amount, based on a value in use, was calculated using an earnings model with reference to the projected cashflows relating to the CGU over a period of 5 years, which used key assumptions such as net AuMA growth, comprising net sales of £150 million and market growth rate (5%, 2020: 2.5% per annum), terminal growth rate (2%, 2020: 2%) and a discount rate (12.8%, 2020: 13.0%). Based on these reasonable estimates there was no indication of impairment and headroom over the carrying value of goodwill of £5.9 million.

Sensitivity analysis was carried out on this model which included changing the discount rate and reducing the net AuMA growth. The discount rate could be increased by 1% without impacting goodwill and resulted in a £5.1 million reduction in headroom. If the terminal growth rate reduced by 0.6% the headroom would be reduced by £2.2 million but would not lead to an impairment. However, reducing the fund inflows to nil would result in the carrying value of goodwill being fully impaired. Management consider this to be a reasonably possible scenario, however the five year modelling timeframe would give ample time for management action. The "breakeven" point for impairment is net flows of £104 million. Given the strong current investment performance, and net inflows for the Global Equity funds in the period ended 30 September 2021 management have concluded that no impairment of the goodwill is required. An assessment of the goodwill will be reperformed at the financial year end.

The Architas Goodwill on acquisition is allocated to the Multi Asset team CGU. At 31 March 2021 an assessment was made in relation to impairment of the goodwill where the recoverable amount, based on a value in use, was calculated using an earnings model with reference to the projected cashflows relating to the CGU over a period of 5 years, which used key assumptions such as net sales, net AuMA growth rates (4% per annum), terminal growth rate (2%) and a discount rate of 12.8%. Based on this assessment there was no indication of impairment.

Sensitivity analysis was carried out on this model which included changing the discount rate and reducing the market growth. A reasonably possible change in the key assumptions would not lead to an impairment. In a severe scenario of nil market growth and nil net sales over the five year model the goodwill would be impaired. Management consider this to be a highly unlikely scenario and management would take action in such a scenario. Further, given this relatively recent acquisition and satisfactory performance in the period since acquisition management have concluded that no impairment of the goodwill is required. An assessment of the goodwill will be reperformed at the financial year end.

£'000

ATI - Sustainable investment team

11,873

Neptune - Global Equity investment team

7,753

Architas - Multi-Asset team

7,951

27,577

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Trade and other receivables

30-Sep-21

30-Sep-20

31-Mar-21

£'000

£'000

£'000

Trade receivables:

- Fees receivable

- Unit Trust sales and cancellations

Prepayments and accrued income

22,703

211,316

6,916

13,749

164,871

7,499

33,118

254,006

2,681

240,935

186,119

289,805

All financial assets listed above are non-interest bearing. The carrying amount of these non-interest bearing trade and other receivables approximates their fair value.

As at 30 September 2021, trade receivables of £nil (2020 : £nil) were past due but not impaired. Expected credit losses are immaterial.

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