Premier Miton Regulatory News (PMI)

PREMIER MITON GROUP PLC

HALF YEAR RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2022

Strong investment performance despite volatile market conditions

Premier Miton Group plc ('Premier Miton', 'Company' or 'Group'), the AIM quoted fund management group, today announces its half year results for the six months ended 31 March 2022 (the 'Period').

Highlights 

· £12.8 billion closing Assets under Management 3 ('AuM') (2021 HY: £12.6 billion)

· £12.5 billion closing AuM at 30 April 2022

· Net outflows of £(401) million in the Period (2021 HY: £359 million inflows)

· 80% of funds have above median investment performance since launch or tenure 4 (2021 HY: 74%)

· Adjusted profit before tax 1,3 of £14.6 million (2021 HY: £11.9 million)

· Profit before tax of £9.9 million (2021 HY: £6.2 million)

· Proposed interim dividend of 3.7 pence per share (2021 interim: 3.7 pence per share)

· On 25 May 2022, Premier Miton announced the further expansion of its investment capabilities with the hire of a new emerging market sustainable equities team

· New institutional distribution capability established to build relationships with institutional investors and investment consultants 

Notes

(1) Adjusted profit before tax is calculated before the deduction of taxation, amortisation, share-based payments, merger related costs and exceptional items. Reconciliation included within the Financial Review section.

(2) Adjusted earnings per share is calculated before the deduction of amortisation, share-based payments, merger related costs and exceptional costs.

(3) These are Alternative Performance Measures ('APMs').

(4) As at 31 March 2022. Based on Investment Association sector classifications where applicable, with data sourced from FE Analytics using the main representative post-RDR share class, based on a total return, UK Sterling basis. Performance for investment trusts is calculated on Net Asset Value ('NAV'), ranked against the relevant Morningstar category for each investment trust.

Mike O'Shea, Chief Executive Officer of Premier Miton Group, commented:

"This is a good set of results given the volatile market environment. Premier Miton is a well-diversified asset manager operating on a stable and sustainable platform with a robust balance sheet and, notwithstanding the more difficult market environment, our business is in good health. We are delivering strong investment returns for our fund investors with almost 90% of our funds outperforming over 3 years and 80% since tenure. At times of market stress there are substantial opportunities for genuinely active managers who have the courage of their convictions to run differentiated, long-term, and focused portfolios by taking an agile and positive role in the capital allocation process.

"We remain focused on our medium-term goal of growing our assets under management to £20bn and beyond. We continue to develop our successful profile in the UK wealth management and independent financial advisory space as well as through our new distribution channel in the UK institutional market. 

"We are committed to invest in the future of our business by hiring talented, high conviction managers to strengthen the range of funds we can offer investors. We are therefore excited to welcome a new Global Emerging Markets sustainable equities team. This represents an important strategic development, aligned with our objective to expand our investment strategies, as well as bolstering our range of dedicated responsible and sustainable investment products.

The outlook for investment markets remains uncertain and, in my view, this is likely to remain the position for some months yet. Our balance sheet strength and overall health of the business will allow us to focus on delivering superior investment returns for our clients through genuinely active investing during this volatile period. As and when investors decide to commit new capital to investment markets once more, I believe our strong, long term performance record places us in a good position to capture significant market share."

ENDS

For further information, please contact:

www.premiermiton.com

About Premier Miton

Premier Miton Investors is focused on delivering good investment outcomes for investors through relevant products and active management across its range of investment strategies, which include equity, fixed income, multi-asset and absolute return.

LEI Number: 213800LK2M4CLJ4H2V85

Chairman's Statement

Investment markets by their nature are subject in good and bad ways to commercial and political events and it is not surprising that we have experienced a tough first half to the year. However, our business has demonstrated its strength and we are continuing with our medium-term growth plans.

Our financial performance has been affected by market turbulence with our Assets under Management ('AuM') ending the period at £12.8 billion, however, our adjusted profit before tax was £14.6 million, representing an increase of 22% on the comparative period.

We have a clear purpose in managing our funds as well as we can for the benefit of our clients, and a strategy designed to provide for their needs and ambitions as well as those of our people and shareholders.

During the period, the Board held a strategy day to review this in detail and I am pleased to say we reaffirmed our objectives and plans to achieve these. We looked carefully at key aspects of our own business and resources, as well as reviewing our markets and competitors, to ensure we are rigorous in our self-examination as well as clear sighted in considering the terrain we have to traverse.

The broad savings market is large and ever changing, containing a diverse range of participants and importantly has long term structural growth. We are confident that there is an attractive space for high performing genuinely active asset management here in the UK as well as in other international markets, and properly tackled this should allow us to grow our business and create shareholder value.

Strong fund performance is critical in our industry as is an energetic yet disciplined approach to managing our own business to improve our overall performance. We believe that our diversified product offering benefits our business and contributes to our resilience. We actively manage our portfolio of funds as well as regularly consider changes to reflect evolving market demands and areas of future growth which should in time contribute to shareholder value.

The business now has a range of funds and investment performance which would be attractive to the institutional market, alongside our traditional distribution channels in the UK IFA and wealth management sectors. Following the recent appointment of a Head of Business Development (Institutional), we are starting carefully to invest in creating a proposition in what we see as a market with considerable potential for us.

We continue to pursue organic, tactical and strategic growth and value opportunities where we believe they are in the interests of the business. We remain disciplined in our approach and shareholders will have noted that we stepped away from one potential public market transaction during the period. I am confident that the Board made the right decisions here and I know that our management team were thorough and robust throughout the process.

Our industry is likely to present a range of opportunities over the coming period and I feel comfortable that we can actively participate in these conversations from a position of strength as a highly credible potential new partner for high quality individuals, teams and even other businesses.

At meetings I have with our shareholders and third parties, I am frequently asked about the culture of Premier Miton and how we manage this. Culture is crucial to success or failure in our industry and the Board ensures that we keep a close watch on this. The Board and management team seek to demonstrate the right tone from the top and we use formal surveys and informal feedback to foster an inclusive and accountable culture and demonstrate our values. We want and expect to be doing the right things, in the right way and for the right reasons, with a focus on looking after our clients. There are always things we can adjust yet I believe we have a strong and healthy culture for our business to support our strategic ambitions.

The commercial turbulence of the pandemic, along with current political and market strains, is testing for all of us and I am pleased how well our people are handling this within the business. We are assessing how we work and the changing attitudes of our people to make sure that we continue to provide an environment where individuals can flourish with a common and clear understanding of their responsibilities and requirements, and where decision making is achieved in a robust and defensible way.

We have a strong and well-regarded management team that we are keen to retain, motivate and reward appropriately, including for achieving our strategic objectives which include growing shareholder value. Following a review of the compensation framework for this group, we have now decided to deploy the LTIP which Premier established on its IPO in 2016 for this and future years. We believe the scheme has been designed to align the interests of our major stakeholders and has appropriate mechanisms and protections. Further details will be communicated in the next Annual Report. The Board is confident that this is in the best interests of all our stakeholders.

In uncertain times our financial position is a source of strength and reassurance. We have a range of potential demands on our capital and cash, including of course maintaining a suitable level of regulatory capital. A lot of thought and effort goes into deciding on this. In line with our ambitions and strategy, we are seeking to invest in future growth areas, for example by hiring individuals and teams, or developing our business model in a careful way.

It is important to us that we seek to provide an attractive return for our shareholders, including cash returns underpinned by our dividend policy. The interim dividend of 3.7p reflects our confidence in the resilience of the business and the board will continue to monitor our capital allocation approach to ensure we are balancing prudence with investment in the long-term growth of the business and adequate cash returns to shareholders.

The asset management industry is expected to play an increasingly important role in dealing with climate change concerns. We are a responsible firm and keen to do not only what we must but what we should; it is simply a matter of good business. Of course, our main investment responsibility is to generate returns for our clients on a basis consistent with their expectations and we note that for many these increasingly include low/zero carbon alignment.

This is a rapidly evolving and complex area of expertise and we are making sure that the Board is fully aware of the issues and challenges involved so we are in a position to exercise appropriate oversight and governance in making good strategic choices, especially as regards to commitments made by the business.

Outlook

In my statement in the last Annual Report, I commented that we are an ambitious and growing business, that markets were showing signs of strain and material volatility, with an uncertain political and regulatory environment adding to our challenges.

The war in Ukraine has added to this list. I also said that the long-term prospects for the savings markets are attractive and we continue to believe this. I have a high level of confidence in the quality and attitude of our people and in the resilience and potential of our business. We will continue to work hard through these challenging times for a better future for all of our stakeholders.

Robert Colthorpe

Chairman

26 May 2022

Chief Executive Officer's Statement

The half year ended 31 March 2022 was a more challenging period for the Group. Recent geopolitical events, as well as worries about inflation, introduced additional uncertainty for our clients. As a result we have seen a much tougher environment for UK retail fund flows across the industry and we have not been immune to this.

Overall, investors made net withdrawals of £303 million from our open-ended funds during the period. This represents around 2% of our opening Assets under Management ('AuM').

Inevitably, the falls in markets we have seen of late have impacted on our total AuM which stood at £12.8 billion at the end of March, down some 8% on the position on 1 October 2021. However, we are long term investors both for our clients and for our business and recognise that there will be many fluctuations in markets as we build for the future. Our business remains strong with good cash reserves and an exciting and diversified portfolio of actively managed funds that we believe will become increasingly attractive to investors seeking strong investment performance in the new environment we face over the coming years. With this in mind, we are continuing to develop our business by adding new investment capabilities and through developing new distribution channels for our funds.

I am proud of how the team at Premier Miton has responded to recent challenges and their commitment to deliver good investment results for our clients through our clear and consistent approach to genuinely active management.

At 31 March 2022, 62% of our funds by number were ranked in the first quartile of our funds' relevant sectors since fund manager start date, and 80% of our funds had performed above median in their respective Investment Association ('IA') sectors over the same period.

It is our belief that the conditions created by a period of reducing interest rates and deflation seen since the financial crisis of 2008 will now make way for a different reflationary environment.

Our proposition of genuinely active management managed by very high-quality investment teams is well suited to produce long term value for clients in these conditions.

Business performance

The Group's average AuM was £13.5 billion versus £11.8 billion for the comparative period, an increase of 14%.

Net outflows for the period from our open-ended funds were £303 million (2021 HY: £14 million inflow). We have seen investor redemptions predominantly from out of favour areas for wealth managers and investment-led intermediaries, such as UK equities. We have continued to see redemptions from our multi manager funds, although the rate of these redemptions has slowed and we are encouraged by the progress we are making to grow net flows and assets under management in our directly invested multi asset funds. Our range of six Diversified funds have strong performance records and are seeing good levels of new business from intermediaries, as well as ratings from highly regarded research agencies.

Pleasingly the business demonstrated robust profitability with adjusted profit before tax increasing by 22% against the comparative period to £14.6 million.

Following the arrival of our fixed income team in September 2020, we have continued to see strong net flows and an 11% increase in AuM to £1.1 billion. This includes the Group's existing corporate bond fund and two newly launched funds. Growing this franchise is a core priority and the team's highly active investment approach should be well suited to succeeding in more volatile markets.

In the past two years we have launched five new equity and bond funds. AuM in these funds has now reached a total of £413 million. These funds are run by talented investment teams who are establishing their important three-year track records within Premier Miton. When we look across that important three-year performance period for our more established funds, we see strong numbers across UK equities, European equities, global infrastructure, US equities, global sustainable equities, global equity income, multi-asset, pan European property, absolute return and fixed income. As ever, our primary focus is on ensuring that we deliver superior investment outcomes for investors in our funds. The combination of our new teams and our established managers coupled with our strong investment performance means we are optimistic about the long-term growth potential of the Group.

Product development

During the period the Group has continued to develop its product range. In March 2022 we introduced the Premier Miton Diversified Sustainable Growth Fund to our range of dedicated responsible and sustainable funds. This fund was previously known as the Premier Miton Balanced Multi Asset Fund and has been managed by Neil Birrell and the Diversified investment team since March 2021. The change better reflects the fund characteristics with a strong environmental, social and governance profile and long-term sustainable growth themes, as described in the fund's updated investment policy and investment strategy.

We now have a total of six funds that are dedicated to responsible and sustainable investing and the Premier Miton Diversified Sustainable Growth Fund is our first multi-asset fund in this category. Dedicated responsible and sustainable investing funds have been a significant area of demand from investors in the UK and elsewhere, and this is believed to be a significant, long-term trend. I am glad that the Group continues to develop strong offerings in this area, as well as the integration of responsible and sustainable factors in our wider investment approach. Raising assets in these dedicated responsible and sustainable investment strategies is a key business development focus.

I am pleased to be able to report that during the period, as well as launching new dedicated responsible and sustainable investing funds, we have also made good progress in integrating responsible and sustainable factors across our investment strategies. Importantly, we have continued to make good progress in the area of responsible investing, including initiating a Responsible Investing Oversight Committee to oversee our activities in this area, led by our Head of Responsible Investing.

We have also expanded our responsible investing team with a new hire and we are a signatory to the Financial Reporting Council's Stewardship Code and achieved a B- rating for our most recent CDP submission covering our environmental impacts, processes and plans. We have also partnered with Climate Action 100+, which is an investor-led initiative to ensure the world's largest corporate greenhouse gas emitters take necessary action on climate change, and we have engaged with many of the companies we invest in to participate in the CDP Non-Disclosure Campaign.

During the period, we have been informed that three of our funds have been shortlisted in three different multi-asset and flexible investment categories for this year's Investment Week Fund Manager of the Year Awards. The awards are designed to "honour fund managers and groups at the top of their game who have demonstrated consistently strong performance for investors and whom the judging panel believe have the potential to continue

to outperform in the future."

The three funds are Premier Miton Defensive Multi Asset, Premier Miton Diversified Growth and Premier Miton Worldwide Opportunities. We were also pleased to learn that Premier Miton Defensive Multi Asset, Premier Miton Diversified Growth, Premier Miton Cautious Monthly Income and Premier Miton Multi-Asset Monthly Income have all been shortlisted for awards with Professional Adviser.

Distribution

Over the past year the Group has been assessing the opportunity to develop a presence in the institutional market, catering to the demands of institutional investors looking for high alpha investment strategies.

In April 2022 we welcomed a new Head of Business Development - Institutional who will be responsible for building, maintaining, and developing relationships with institutional investors and investment consultants. Our strategy in this new growth channel will complement our already successful UK wholesale-focused business, with the intention of growing AuM and diversifying our client base.

Our marketing team continues to focus on a broad range of activities to build awareness of the Premier Miton brand and familiarity across our investment range, as well as keeping our clients informed. This work has included organising digital content, including webinars, videos, infographics, e-marketing, advertising, social media, and virtual events, aimed at both existing and potential investors.

The marketing team have continued to develop the Group's new and improved website, launched in March 2021, to ensure it continues to provide easy access to up-to-date, relevant information for different client types

and products.

Ukraine crisis

At the time of writing, we continue to hear harrowing stories of the widescale impact the war has had on Ukrainians and their country. As a Group we have made a corporate donation to the DEC Ukraine Humanitarian Appeal, and we extend our solidarity to those who have been displaced by the awfulness of the violence.

From an investment point of view, we know that all of our funds continue to be expertly and actively managed by our investment teams. We are long term investors, but this period of volatility and uncertainty for economies, markets and investing needs to be carefully managed. We keep our clients informed, including through regular fund manager commentaries, client meetings with fund managers, videos, webinars and articles. The economic, market and investment implications of the crisis formed a key part of the virtual event we held in March on our Diversified funds for investment-led intermediaries, featuring eight fund managers covering different asset classes.

We took the decision during the period to exclude Russian investments from our portfolios. Our directly invested funds moved to exclude Russian Sovereign debt, corporate debt instruments and equities listed on a Russian exchange or issued by a company incorporated in Russia or Belarus. Outside of our directly invested funds, including in our range of multi-manager funds which invest in Collective Investment Schemes, we have a policy to exclude Russian domiciled funds and to ensure that managers of external schemes intend to fully comply with sanctions issued against Russia and other relevant countries.

River & Mercantile

In November it was announced that we had approached the board of River & Mercantile ('RMG') about a possible acquisition of their residual fund management business following the sale of their solution business to Schroders. In January our Board concluded that there were insufficient commercial merits for our shareholders to make a formal proposal for the acquisition of RMG and thereafter we withdrew from the process.

We are extremely well placed as a stand-alone business and we will continue to focus on delivering outstanding returns for our investors and on our own organic growth plans. However, we will continue to look at possible strategic acquisitions where we believe they can accelerate this growth path and create value for our shareholders.

Outlook

The last decade or so has been dominated by quantitative easing, falling bond yields, and falling inflation. This

has had the effect of 'raising all boats' across asset classes and reducing the dispersion of returns within major indices.

As we look forward, the long-term implications of current events remain unclear. Investors are pondering issues such as energy security, global supply chains, energy transition, increased defence spending and the end of quantitative easing. Above all, a generation of investors has never had to worry about investing in an inflationary era.

Irrespective of whether these issues turn out to be permanent or more transitory in nature, they will create opportunities for genuinely active managers who have the courage of their convictions to run long term, focused portfolios. Not only through good investment performance but through the active and positive role we play in the capital allocation process. Taken together, these factors represent good opportunities for our business to grow significantly.

We expect strong demand for clearly differentiated, high performing, actively and responsibly managed investment products as investors recognise their investments have to work harder to achieve their financial objectives.

Alongside our core active investment proposition, we have a strong, ongoing focus on delivering good client service, improving the efficiency of our business processes and maintaining a working environment that makes Premier Miton a really good place to work. With this focus I am confident we can deliver for our clients, our shareholders, our employees and society over the long term.

Mike O'Shea

Chief Executive Officer

26 May 2022

Financial Review

Financial performance

Profit before tax increased by 60% to £9.9 million (2021 HY: £6.2 million). The increase in profitability for the period was primarily driven by a higher average level of assets being managed by the Group when compared to the comparative period, detailed below. In addition to this, the comparative period includes non-recurring costs associated with the completion of the operational aspects of the merger totalling £1.2 million.

Adjusted profit before tax *, which is stated before amortisation, share-based payments, merger related costs and exceptional costs increased to £14.6 million (2021 HY: £11.9 million).

Adjusted profit and profit before tax

* Indicates Alternative Performance Measures ('APMs').

Assets under Management * ('AuM')

AuM ended the period at £12,847 million (2021 HY: £12,602 million) representing an 8% fall from the opening position of £13,931 million on 1 October 2021. Despite this, the Group's average AuM increased by 14% over the comparative period to £13,453 million (2021 HY: £11,819 million).

Geopolitical events created a challenging period for markets and this was reflected in the Group's AuM. Despite strong relative investment performance the Group saw negative market returns of £683 million. 

Net outflows for the period from open ended funds were £303 million (2021 HY: £14 million net inflows), these were primarily from UK equity funds and the multi-asset multi-manager funds where there was weaker client demand. The outflows were partially offset by inflows into the fixed income funds and the Diversified multi-asset funds.

Net revenue

1 Being management fee income less trail/rebate expenses and the cost of any external Authorised Corporate Director ('ACD') fees

2 Calculated using the daily AuM adjusted for the monthly closing AuM invested in other funds managed by the Group

3 Net management fee margin represents annualised net management fees divided by the average AuM

The Group's revenue represents management fees generated on the assets being managed by the Group. The net management fee margin for the period was 65.1 basis points. The increase from the comparative period reflects the alignment of the operating model completed on 27 November 2020 with all open-ended funds being on the in-house ACD platform from that date.

Net management fees increased to £43.7 million (2021 HY: £37.9 million) representing a 15% increase reflecting the higher level of average AuM compared to the comparative period.

Administration expenses

Administration expenses for the period (excluding share-based payments) totalled £29.1 million (2021 HY: £26.6 million), an increase of 9%.

Staff costs continue to be the largest component of administration expenses, consisting of both fixed and variable elements.

The fixed staff costs, which includes salaries and associated National Insurance, employers' pension contributions and other indirect costs of employment increased to £9.8 million (2021 HY: £9.1 million). The average headcount for the period increased to 163 (2021 HY: 150) reflecting further hires predominantly in the investment team in the second half of 2021 and continued investment in the current financial period.

Variable staff costs totalled £9.5 million (2021 HY: £7.8 million). Included within this are general discretionary bonuses, sales bonuses and bonuses in respect of the fund management teams, plus associated employers' national insurance. These costs move in line with the net revenues of the Group and the adjusted profit before tax.

Overheads and other costs totalled £9.2 million (2021 HY: £9.0 million) being 21.1% of net revenues (2021 HY: 23.4%).

Share-based payments

The share-based payment charge for the period was £2.2 million (2021 HY: £2.1 million).

At 31 March 2022 the Group's Employee Benefit Trusts ('EBTs') held 12,692,553 ordinary shares representing 8.0% of the issued ordinary share capital (2021 HY: 10,421,565 shares).

At the period end the outstanding awards totalled 12,486,827 (2021 HY: 13,213,920).

During the period 1,902,500 awards were issued (2021 HY: 3,980,000). See note 12 for further detail.

Balance sheet, capital management and dividends

Total shareholders' equity as at 31 March 2022 was £127.7 million (2021 HY: £129.5 million).

At the period end the cash balances of the Group totalled £36.0 million (2021 HY: £34.4 million). The Group has no external bank debt.

Dividends totalling £9.3 million were paid in the period (2021 HY: £6.7 million).

The Board is recommending an interim dividend payment of 3.7p per share (2021 HY: 3.7p). The interim dividend will be paid on 5 August 2022 to shareholders on the register at the close of business on 8 July 2022.

The Group's dividend policy is to target an annual ordinary dividend pay-out of approximately 50 to 65% of profit after tax, adjusted for exceptional costs, merger related costs, share-based payments and amortisation.

Piers Harrison

Chief Financial Officer

26 May 2022

Alternative Performance Measures ('APMs')

Unaudited Condensed Consolidated Statement of Comprehensive Income

for the six months ended 31 March 2022

No other comprehensive income was recognised during 2022 or 2021. Therefore, the profit for the period is also the total comprehensive income.

All of the amounts relate to continuing operations.

Unaudited Condensed Consolidated Statement of Changes in Equity

for the six months ended 31 March 2022

Unaudited Condensed Consolidated Statement of Financial Position

as at 31 March 2022

Unaudited Condensed Consolidated Statement of Cash Flows

for the six months ended 31 March 2022

Notes to the Unaudited Condensed Consolidated Financial Statements

for the six months ended 31 March 2022

1. Basis of accounting

These interim unaudited Condensed Consolidated Financial Statements do not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006. They have been prepared on the basis of the accounting policies as set out in the Group's Annual Report for the year ended 30 September 2021.

The interim unaudited Condensed Consolidated Financial Statements to 31 March 2022 have been prepared in accordance withIAS 34 'Interim Financial Reporting' and the Listing Rules of the Financial Conduct Authority.

Premier Miton Group plc (the 'Group') is the Parent Company of a group of companies which provide a range of investment management services in the United Kingdom and Channel Islands.

The Group's 2021 Annual Report is prepared in accordance with International Financial Reporting Standards ('IFRS') as adopted by the United Kingdom, and is available on the Premier Miton Group plc website (www.premiermiton.com).

The Group has considerable financial resources and ongoing investment management contracts. As a consequence, the Directors believe that the Group demonstrates the financial resilience required to manage its business risks successfully. The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for a period of at least 12 months after the date the interim financial statements are signed. Thus, the Directors continue to adopt the going concern basis of accounting in preparing the interim unaudited Condensed Consolidated Financial Statements. The Directors note that the Group has no external borrowings and maintains significant levels of cash reserves. The Group has conducted financial modelling at materially lower levels of AuM with the business remaining cash generative. The Directors have also reviewed and examined the financial stress testing inherent in the Internal Capital Adequacy Assessment Process ('ICAAP').

These interim unaudited Condensed Consolidated Financial Statements were approved and authorised for issue by the Board acting through a duly authorised committee of the Board of Directors on 26 May 2022.

The full-year accounts to 30 September 2021 were approved by the Board of Directors on 6 December 2021 and have been delivered to the Registrar of Companies. The report of the auditor on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under section 498 of the Companies Act 2006. The figures for the six months ended 31 March 2022 and the six months ended 31 March 2021 have not been audited.

The interim unaudited Condensed Consolidated Financial Statements are presented in Sterling and all values are rounded to the nearest thousand pounds (£000) except where otherwise indicated.

Forward looking statements

These interim unaudited Condensed Consolidated Financial Statements are made by the Directors in good faith based on information available to them at the time of their approval of the accounts. Forward looking statements should be treated with caution due to the inherent uncertainties, including economic, regulatory and business risk factors underlying any such statement. The Directors undertake no obligation to update any forward looking statement whether as a result of new information, future events or otherwise. The interim unaudited Condensed Consolidated Financial Statements have been prepared to provide information to the Group's shareholders and should not be relied upon by any other party or for any other purpose.

2. Segmental reporting

The Group has only one business operating segment, asset management for reporting and control purposes.

IFRS 8 'Operating Segments' requires disclosures to reflect the information which the Group's management uses for evaluating performance and the allocation of resources. The Group is managed as a single asset management business and as such, there are no additional operating segments to disclose. Under IFRS 8, the Group is also required to make disclosures by geographical segments. As Group operations are solely in the UK and Channel Islands, there are no additional geographical segments to disclose.

3. Dividend

The final dividend for the year ended 30 September 2021 of 6.3p per share was paid on 11 February 2022 resulting in a distribution of £9,268,748. This is reflected in the unaudited Condensed Consolidated Statement of Changes in Equity (2021 HY: £6,659,616).

4. Revenue

Revenue recognised in the Consolidated Statement of Comprehensive Income is analysed as follows:

All revenue is derived from the United Kingdom and Channel Islands.

5. Exceptional items and merger related costs

Recognised in arriving at operating profit from continuing operations:

Exceptional items are those items of income or expenditure that are considered significant in size and/or nature to merit separate disclosure and which are non-recurring.

There were £25,496 of merger related legal and professional costs in the period (2021 HY: £667,026, of which, £25,496 represented legal and professional fees associated with the merger with Miton Group plc and merger integration costs of £641,530).

There were no employment restructuring costs arising as a result of the merger (2021 HY: £546,057).

6. Taxation

In the Spring Budget 2021, the Government announced that from 1 April 2023 the corporation tax rate will increase to 25% from 19%. This was subsequently enacted on 24 May 2021. The deferred tax balances included within the Consolidated Financial Statements have been calculated with reference to the rate of 25% to the relevant balances from 1 April 2023.

At 31 March 2022, a deferred tax liability of £2,066,253 has been included in relation to a temporary difference on an intangible asset held on the balance sheet acquired in a business combination in 2007. Management has assessed this adjustment to be not material (on both quantitative and qualitative bases) to require restating comparatives, and as such the deferred tax liability has been recognised in this Unaudited Condensed Consolidated Statement of Financial position via current period tax charge.

7. Earnings per share

Basic earnings per share is calculated by dividing the profit for the period attributable to ordinary equity shareholders of the Parent Company by the weighted average number of ordinary shares outstanding during the period.

The weighted average of issued ordinary share capital of the Company is reduced by the weighted average number of shares held by the Group's Employee Benefit Trusts ('EBTs'). Dividend waivers are in place over shares held in the Group's EBTs.

In calculating diluted earnings per share, IAS 33 'Earnings Per Share' requires that the profit is divided by the weighted average number of ordinary shares outstanding during the period plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares during the period.

(a) Reported earnings per share

Reported basic and diluted earnings per share has been calculated as follows:

(b) Adjusted earnings per share

Adjusted earnings per share is based on adjusted profit after tax, where adjusted profit is stated after charging interest but before share-based payments, amortisation, merger related costs and exceptional items.

Adjusted profit for calculating adjusted earnings per share:

Adjusted earnings per share was as follows using the number of shares calculated at note 7(a):

8. Goodwill and other intangible assets

Cost amortisation and net book value of intangible assets are as follows:

Other intangible assets relate to the investment management agreements acquired in business combinations between the funds to which they were the investment manager and the value arising from the underlying client relationships.

The Group has determined that it has a single cash-generating unit ('CGU') for the purpose of assessing the carrying value of goodwill. Impairment testing is performed at least annually whereby the recoverable amount of the goodwill is analysed via the value-in-use method and compared to the respective carrying value. During the period no impairment was identified.

9. Cash and cash equivalents

10. Provisions

Provisions relate to dilapidations for the offices at 6th Floor, Paternoster House, London, the lease on this property runs to 28 November 2023 and the provision for dilapidations has been disclosed as non-current.

11. Share capital

12. Share-based payment

The total expense recognised for share-based payments in respect of employee services received during the period to 31 March 2022 was £2,240,420 (2021 HY: £2,067,110).

During the period, 1,902,500 (2021 HY: 3,980,000) nil cost contingent share rights over ordinary shares of 0.02p in the Company were granted to 32 employees (2021 HY: 36 employees). Of the total award, 375,000 (2021 HY: 550,000) nil cost contingent share rights were awarded to Executive Directors. The awards will be satisfied from the Group's EBTs.

The share-based payment expense is calculated in accordance with the fair value of the contingent share rights on the date of grant. The price per right at the date of grant was £1.425 on 10 March 2022, resulting in a fair value of £2,711,063 to be expensed over the vesting period of three years.

The key features of the awards include: a three-year vesting term, automatic vesting at the relevant anniversary date with the delivery of the shares to the participant within 30 days of the relevant vesting date.

During the period, 157,035 nil cost contingent share rights over ordinary shares of 0.02p in the Company were exercised by three employees.

After the period end, 622,916 nil cost contingent share rights over ordinary shares of 0.02p in the Company that vested on 16 April 2022, were exercised by 34 employees. On 23 April 2022, 848,333 nil cost contingent share rights over ordinary shares of 0.02p in the Company vested and were exercised by six employees; of the total 275,000 were exercised by an Executive Director.

(a) Employee Benefit Trusts ('EBTs')

Premier Miton Group plc established an EBT on 25 July 2016 to purchase ordinary shares in the Company to satisfy share awards to certain employees.

During the period, 1,902,500 (2021 HY: 500,000) shares were acquired and held by the Group's EBTs at a cost of £3,222,043 (2021 HY: £723,670).

At 31 March 2022, 12,692,553 (2021 HY: 10,421,565) shares are held by the Group's EBTs, 12,486,827 (2021 HY: 10,421,565) shares relate to outstanding awards.

At 31 March 2022, the cost of the shares held by the EBTs of £18,619,283 (2021 HY: £15,372,639) has been disclosed as own shares held by an EBT in the unaudited Condensed Consolidated Statement of Changes in Equity and the unaudited Condensed Consolidated Statement of Financial Position.

13. Subsequent events post balance sheet

At 26 May 2022, there were no subsequent events to report.