9 Jul 2013 11:21
For Immediate Release 9 July 2013
1PM PLC
("1pm" or the "Company" or the "Group")
FINAL RESULTS FOR THE YEAR ENDED 31 MAY 2013
Strong trading momentum maintained to produce another record financial performance
1pm plc (AIM: OPM), the AIM listed independent provider of asset finance facilities to the SME sector, announces final results for the year ended 31 May 2013.
Commenting on the results, Non-executive Chairman, Mike Johnson, said: "Against a challenging UK economic backdrop, I am very pleased to report that 1pm has produced another set of record results, achieving its highest ever levels of revenues and profits. This is proof positive of the success of its business model, its growing reputation within the industry and the appetite amongst SMEs for equipment leasing from specialist independent providers".
Financial Highlights:
·; Revenues up 34.5 per cent. to £3.1m (FY12: £2.31m)
·; Profit before tax up 77.8% to £775k (FY12: £436k)
·; EPS up 70 per cent to 0.0178p (FY12: 0.0104p)
·; Lease portfolio up 34.6 per cent. to £14.8m (FY12: £11.0m)
·; Net assets increased by 15.2 per cent. to £4.56m (FY12: £3.96m) as at 31 May 2013
·; £1.5m of new equity capital raised (before costs) through share placing with Henderson Global Investors after year-end
Operational Highlights:
·; New business written during year up 57 per cent, to £7.8m (FY12: £4.96m)
·; £4.14m of new funding raised (FY12: £4.1m)
·; Customer numbers increased by 26.5 per cent to 2,380 (FY12: 1,881)
·; UK-wide network of finance brokers increased significantly during the year
·; Continued strict underwriting and credit management controls; bad debts and provisions at an all-time low of 1.4 per cent of Lease Portfolio
On current trading and prospects, Chief Executive, Maria Hampton added: "This is the sixth consecutive set of published results to show profit and revenue increases, and I am pleased to report that trading since the year end has remained buoyant. The Group is very well placed both strategically and financially to take further advantage of the significant growth opportunities which exist within the SME lease finance market. The Board anticipates further profitable growth in the current year".
Contacts:
1pm plc | |
Mike Johnson, Non-executive Chairman Maria Hampton, Chief Executive Officer | 0844 967 0944 0844 967 0944 |
WH Ireland (NOMAD) | |
Mike Coe | 0117 945 3470 |
Winningtons Financial PR | |
Paul Vann/Tom Cooper | 0117 985 8989 |
07768 807 631 |
About 1pm:
1pm plc is an established independent asset finance company focused on providing SMEs with accessible funding to add value to their businesses. All customers must have good credit histories and proven ability to repay their finance commitments. 1pm currently lends from £1,000 to- £50,000 for a period of between 12 and 60 months. The Company was admitted to AIM in August 2006.
Mission Statement - 'Helping the UK economy grow by supporting SMEs'
You can find more information on the Company website www.1pm.co.uk
CHIEF EXECUTIVE REVIEW
Financial Results
I am very pleased to report to shareholders that the financial year ended 31 May 2013 was the third consecutive year of increased profit and revenue; moreover, the Group out-performed revised market expectations and produced another set of record results, culminating in its highest ever monthly sales and profits in May 2013. The Group has delivered these results by continuing to focus on its core strengths. It combines a high quality customer service with a flexible approach to lending whilst maintaining strict underwriting and credit management controls to a market it knows well - the UK's SME market.
Total revenue for the year rose 34.5 per cent. to £3.1m (FY12: £2.31m), with profit before tax increasing by 77.8 per cent. to £0.775m (FY12: £0.436m). Earnings per share increased by 70 per cent. to 0.0178p (FY12: 0.0104p).
The Group's balance sheet has continued to strengthen during the year with net assets as at 31 May 2013 standing at £4.56m (FY12: £3.96m).
The lease portfolio has also grown significantly during the year, increasing by 34.5 per cent to £14.8m (FY12: £11.0m). However, no single customer accounts for more than 0.53 per cent. of the total portfolio value. Notwithstanding the current economic climate, defaults are at an all-time low of less than 1.4 per cent. of the portfolio balance and bad debts and provisions as a percentage of the portfolio have decreased by 18.7 per cent. We believe these figures reflect our continued focus on credit management.
Strategic review
The Board has identified a number of significant growth opportunities which will complement the Group's current activities and business model. These include the provision of small business loans to the SME market which continues to experience its own "credit crunch" as a result of the mainstream banking sector's reluctance to provide sufficient funds to small businesses despite Government intervention.
Our unwavering commitment and focus on this much neglected sector of the UK economy will continue.
Operations and Business Development
During the year the Group enjoyed two record sales months; firstly during October 2012 which saw the Group write £840k of new business and most recently, in the final month of the financial year, in May 2013 where record sales of £920k were achieved.
New business written during the year amounted to £7.8m (FY12: £4.96m), an increase of 57 per cent., another record for the Group.
The management team continue to build upon the strong foundations which have been laid and have achieved consistent, continually improving results over the past three years. The policies and procedures in place are regularly reviewed and a responsible and prudent approach to lending has helped to deliver a robust portfolio.
The systems in place are also reviewed regularly to ensure 1pm is working as efficiently as possible. We have made improvements to our bespoke Customer Relationship Management system during the year to further improve production and reduce administration.
The Group's relationship with its network of over 70 finance brokers continues to be a priority. Management places great emphasis on building communication and trust within this network, developing existing relationships whilst growing the network to further improve the Group's geographical coverage of the UK SME market.
Staff
The results are a reflection of the quality and hard work of the people employed by the Group.
Investment within the business has continued and during the year 1pm recruited four additional members of staff; including two apprentices from the local college.
On behalf of the Board and Shareholders, I would like to thank all staff for their continued contribution and commitment to the Group.
Financing
I am pleased to report that the Group raised £4.14m of new funding (FY12: 4.1m) during the financial year from a variety of sources including commercial banking institutions and high net worth individuals. This funding is used solely for the purpose of writing new business. The Board will continue to seek additional funding sources in order to continue to support and satisfy growing demand from the UK SME market.
Shareholders
In June 2013, following the financial year end, the Group raised £1.5m before costs from Henderson Global Investors Ltd, ("Henderson") by way of a placing of new ordinary shares. The Board is very pleased to have an institution such as Henderson supporting the Group.
The Group is very grateful to all of its shareholders for their on-going support and the Board will continue its focus on increasing returns and building shareholder value.
Outlook
Over the past three years the Group has established a strong, stable platform upon which to continue to build its core business. This remains our priority; however the Board is aware of other opportunities that will complement its existing strategy, such as acquisitions and new product offerings.
The withdrawal from the leasing market of one of the UK's largest lenders, ING Lease last November, combined with the constraints placed on the UK mainstream banking sector has resulted in a dramatic increase in business levels, which triggered the need to increase staff numbers. 1pm will continue to monitor new business volumes and will recruit new staff accordingly.
Over the past three years the Group has established a strong, stable platform upon which to continue to further build its business.
The Board remains very positive about the opportunities to increase its market share and enhance further its reputation within the marketplace as a leading independent provider of finance to the SME market. The Group is well positioned to take advantage of the significant growth potential and anticipates further profitable growth in in the current financial year.
Maria Hampton
Chief Executive Officer
8 July 2013
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 MAY 2013
Notes | 2013 £ | 2012 £ | |
CONTINUING OPERATIONS | |||
Revenue | 2 | 3,106,612 | 2,310,571 |
Cost of Sales | (1,651,194) | (1,275,253) | |
GROSS PROFIT | 1,455,418 | 1,035,318 | |
Administrative expenses | (663,179) | (576,542) | |
OPERATING PROFIT | 792,239 | 458,776 | |
Finance costs | (17,100) | (22,749) | |
Finance income | 148 | - | |
PROFIT BEFORE INCOME TAX | 3 | 775,287 | 436,027 |
Income tax | (172,219) | (87,602) | |
PROFIT FOR THE YEAR | 603,068 | 348,425 | |
Profit attributable to: | |||
Owners of the parent | 603,068 | 348,425 | |
Earnings per share expressed | |||
In pence per share: | 4 | ||
Basic | 0.017760 | 0.010447 | |
Diluted | 0.017760 | 0.010447 |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
31 MAY 2013
2013 | 2012 | |
£ | £ | |
ASSETS | ||
NON-CURRENT ASSETS | ||
Property, plant and equipment | 40,761 | 38,621 |
Deferred tax | - | 24,278 |
40,761 | 62,899 | |
CURRENT ASSETS | ||
Trade and other receivables | 12,899,718 | 10,111,880 |
Cash and cash equivalents | 12,894 | 5,187 |
12,912,612 | 10,117,067 | |
TOTAL ASSETS | 12,953,373 | 10,179,966 |
EQUITY | ||
SHAREHOLDERS' EQUITY | ||
Called up share capital | 2,315,132 | 2,315,132 |
Share premium | 1,569,340 | 1,569,340 |
Retained earnings | 679,357 | 76,289 |
TOTAL EQUITY | 4,563,829 | 3,960,761 |
LIABILITIES | ||
NON-CURRENT LIABILITIES | ||
Trade and other payables | 3,112,199 | 3,125,473 |
Financial liabilities - borrowings | ||
Interest bearing loans and borrowings | 100,000 | 100,000 |
3,212,199 | 3,225,473 | |
CURRENT LIABILITIES | ||
Trade and other payables | 4,109,327 | 2,927,418 |
Financial liabilities - borrowings | ||
Bank overdrafts | 520,077 | 66,314 |
Interest bearing loans and borrowings | 400,000 | - |
Tax Payable | 147,941 | |
- | ||
5,177,345 | 2,993,732 | |
TOTAL LIABILITIES | 8,389,544 | 6,219,205 |
TOTAL EQUITY AND LIABILITIES | 12,953,373 | 10,179,966 |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2013
Called up | Retained | Share | Total | |
Share | earnings | premium | equity | |
capital | ||||
£ | £ | £ | £ | |
Balance at 1 June 2011 | 2,236,735 | (272,136) | 1,567,249 | 3,531,838 |
Changes in equity | ||||
Issue of share capital | 78,407 | - | 2,091 | 80,498 |
Total comprehensive income | - | 348,425 | - | 348,425 |
Balance at 31 May 2012 | 2,315,132 | 76,289 | 1,569,340 | 3,960,761 |
Changes in equity | ||||
Issue of share capital | - | - | - | - |
Total comprehensive income | - | 603,068 | - | 603,068 |
Balance at 31 May 2013 | 2,315,132 | 679,357 | 1,569,340 | 4,563,829 |
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2013
2013 | 2012 | |
£ | £ | |
Cash flows from operating activities | ||
Cash generated from operations | (812,142) | 3,308 |
Interest paid | (17,100) | (22,749) |
Net cash from operating activities | (829,242) | (19,441) |
Cash flows from investing activities | ||
Purchase of tangible fixed assets | (16,962) | (28,289) |
Interest received | 148 | - |
Net cash from investing activities | (16,814) | (28,289) |
Cash flows from financing activities | ||
New loans in year | 400,000 | - |
Share issue | - | 80,498 |
Net cash from financing activities | 400,000 | 80,498 |
Increase/(decrease) in cash and cash equivalents | (446,056) | 33,768 |
Cash and cash equivalents at beginning of year | (61,127) | (93,895) |
Cash and cash equivalents at end of year | (507,183) | (61,127) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 20132
1. ACCOUNTING POLICIES
Basis of preparation
The financial statements have been prepared in accordance with International Financial Reporting Standards (as adopted by the European Union) and IFRIC interpretations and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements have been prepared under the historical cost convention.
2. SEGMENTAL REPORTING
The company has one business segment to which all revenue, expenditure, assets and liabilities relate.
3. PROFIT BEFORE INCOME TAX
The profit before income tax is stated after charging:
2013 | 2012 | |
£ | £ | |
Other operating leases | 16,020 | 20,924 |
Depreciation - owned assets | 14,822 | 19,921 |
Auditors' remuneration | 10,050 | 9,000 |
Non audit services | 3,450 | 3,450 |
4. EARNINGS PER SHARE
The calculations of earning per share are calculated by dividing the earnings attributable to ordinary shares by the weighted average number of shares in issue during the year. For diluted earnings per share, the weighted average number of ordinary shares is adjusted to assume conversion of all dilutive potential ordinary shares. There are no dilutive ordinary shares.
2013 | 2012 | |
Profit/(Loss) attributable to equity shareholders | £603,068 | £348,425 |
Weighted average number of shares | 3,395,618,769 | 3,335,162,802 |
Basic and diluted earnings per share | 0.017760p | 0.010447p |
5. PUBLICATION OF NON-STATUTORY ACCOUNTS
The financial information set out in this announcement does not comprise the Group's statutory accounts for the years ended 31 May 2013 or 31 May 2012.
The financial information has been extracted from the statutory accounts of the Company for the years ended 31 May 2013 and 31 May 2012. The auditors' opinion on those accounts was unmodified and did not contain a statement under section 498 (2) or section 498 (3) Companies Act 2006 and did not include references to any matters to which the auditor drew attention by the way of emphasis.
The statutory accounts for the year ended 31 May 2012 have been delivered to the Registrar of Companies, whereas those for the year ended 31 May 2013 will be delivered to the Registrar of Companies following the Company's Annual General Meeting.
6. ANNUAL REPORT AND ANNUAL GENERAL MEETING
The Annual Report will be available from the Company's website www.1pm.co.uk from 9th July 2013 and will be posted to shareholders on or before 19 July 2013. The Annual Report contains notice of the Annual General Meeting of the Company which will be held at the Bailbrook House Hotel, Eveleigh Avenue, London Road West Bath BA1 7JD on 16 August 2013 at 12.30p.m.