Walker Crips Regulatory News (WCW)

13 Nov 2007 07:00

Walker Crips Group plc13 November 2007 Walker Crips Group PLC (WCW) Tuesday 13 November, 2007 7:00A - Interim Results Walker Crips Group PLC 13 November 2007 Press Release For immediate release: 13 November 2007. Interim Results for the six months to 30 September 2007 Walker Crips Group PLC ("Walker Crips" or the "Company"), the financial servicesfirm with activities covering stockbroking, fund management, corporate financeand personal wealth management, today announces results for the six months ended 30 September 2007, the highlights of which are: • Revenue of £9,076,000 (2006: £8,439,000), an increase of 7.5% • Operating Profit of £1,226,000 (2006: £1,126,000), an increase of 8.9% • Pre-tax profit of £1,402,000 (2006: £1,225,000), an increase of 14.4% • Earnings per share up 16.7% to 2.8p (2006:2.4p) • Interim dividend increased by 6.8% to 0.94p per share (2006: 0.88p per share) Commenting on the results, David Gelber, Chairman of Walker Crips said: 'I amdelighted to see the business performing strongly and progress being made acrossthe broad range of its operations despite the current challenging investmentclimate. For further information, please contact: Walker Crips Group Plc Tel: +44 (0)20 3100 8000 Rodney FitzGerald, Chief Executive. Stephen Bailey, Investment Director. Further information on Walker Crips Group plc: Further information on Walker Crips Group is available on the Company's website: www.wcwb.co.uk. Chairman's statement It gives me great pleasure to report another strong set of results for the groupreflecting a solid performance from all operating divisions. The pre-tax profitin the six months to 30 September 2007 of £1,402,000 is an increase of 14.4%over the £1,225,000 reported in the comparable period last year. Despitevolatile market conditions in this half-year period, revenues improved by 7.5%to £9,076,000 (2006: £8,439,000) Operations The stockbroking division has shown resilience in the recent difficultinvestment climate. The increase in revenue and profitability has been driven byboth an increase in non-sharing recurring fees and a tight control of costs. All three of our UK equity funds have achieved first quartile performance since1 April 2007, with the longer established UK Growth and Equity Income Funds alsofirst quartile over 1, 3 and 5 years. Equity Income is ranked in the firstdecile since launch and UK Growth, first decile since our investment fundmanagement subsidiary (WCAM) assumed the mandate. Our Multi Manager funds, runfrom our York office, also continue to perform well and attract new monies.Following on from this, WCAM profitability rose by more than 43% over thecomparable period last year, underpinned by higher revenues from substantiallylarger underlying funds. This commendable result has been achieved despite afall in funds under management to £321m as at 30 September 2007 from £383m atthe last year end. Since the half-year end date, we have been granted a mandateto manage additional funds valued at £80m, which significantly contributes tothe recent increase in funds under management to the current total of £410m. Our corporate finance division performed well during an uncertain period. Therecent recruitment of a number of experienced individuals will provide thefoundation for expansion in both advisory and corporate broking services. The London York group, our York-based wealth management arm, has made excellentprogress during the period. The Ebor SIPP continues to attract new investors andhas completed another successful half-year period. Total funds held within EborSIPPs have now increased to £39 million from £25 million at the last year end. In line with our strategy of increasing our recurring fee-based revenues, I ampleased to report further progress, with non broking revenues increasingmarginally to 48.1% of total revenue compared to 47.9% in the previous halfyear. Office Move In August, we relocated our head office to Bunhill Row in the City of London.The effective planning and dedication of the project team, staff and accountexecutives ensured a smooth transition. Our new offices now provide a morefunctional environment for our team and sufficient space to fulfil our expansionplans. Name change and Share Subdivision On 14 August 2007 shareholders approved a proposal to change the Company's nameto Walker Crips Group plc, having earlier approved the subdivision of each old20p ordinary share into three new ordinary shares of 6 2/3p each on 20 July 2007at the Company's Annual General Meeting. Dividend I am pleased to announce an increase in the interim dividend to 0.94p perordinary share (2006: 0.88p per share), a rise of over 6.8%. This is areflection of our confidence in the future of the group. The dividend will bepaid on 14 December 2007 to those shareholders on the register at the close ofbusiness on 23 November 2007. Directors, Account Executives and Staff On behalf of the board, I would like to thank my fellow directors, all accountexecutives and members of staff for their continued loyalty and commitment. Theresults during the period reflect the hard work of all our staff and thecontinued support of our clients. Outlook I remain cautiously optimistic about the second half despite a quiet start withmarkets dominated by credit and liquidity issues. The breadth of the Company'sproducts provides the platform for confidence in our long-term prospects andshould ensure we are well placed to withstand any adverse investment conditionswhich may lie ahead. D. M. Gelber Chairman 13 November 2007 Walker Crips Group plcConsolidated interim incomestatementFor the six months ended 30 Unaudited Unaudited AuditedSeptember 2007 Notes Six months to Six months to Year to 30 September 30 September 31 March 2007 2007 2006 £'000 £'000 £'000 Revenue 2 9,076 8,439 17,959Commission payable (1,893) (1,944) (4,253) ----------- ----------- -----------Gross profit 7,183 6,495 13,706 Share of after taxprofits of jointventures 30 21 50 Administrativeexpenses - other (5,987) (5,390) (11,347)Administrativeexpenses -exceptional item - - (520) ----------- ----------- -----------Total (5,987) (5,390) (11,867)administrativeexpenses ----------- ----------- -----------Operating profit 1,226 1,126 1,889 Investment revenues 179 111 243Finance costs (3) (12) (14) ----------- ----------- -----------Profit before tax 1,402 1,225 2,118 ----------- ----------- ----------------------------------- ----- ----------- ----------- -----------Analysed as:Profit before taxand exceptionalitem 1,402 1,225 2,638Administrativeexpenses -exceptional item - - (520) ----------- ----------- -----------Profit before tax 1,402 1,225 2,118------------------------ ----- ----------- ----------- ----------- Taxation (413) (393) (595) ----------- ----------- -----------Profit for theperiod attributableto equity holdersof the company 989 832 1,523 ----------- ----------- ----------- Earnings per share 5 Basic 2.8p 2.4p 4.4pDiluted 2.7p 2.33p 4.27p Walker Crips Group plcConsolidated interim balancesheetAs at 30 September 2007 Notes Unaudited Unaudited Audited 30 September 30 September 31 March 2007 2007 2006 £'000 £'000 £'000 Non current Assets Goodwill 5,152 4,677 5,152Other intangibleassets 863 978 921Property, plant andequipment 1,465 499 1,143Investment in jointventures 54 25 74Available for saleinvestments 980 886 888Deferred tax asset 177 - 178 ----------- ----------- ----------- 8,691 7,065 8,356Current Assets Trade and otherreceivables 57,985 40,915 64,290Trading Investments 321 298 138Cash and cashequivalents 3,164 4,149 6,298 ----------- ----------- ----------- 61,470 45,362 70,726 ----------- ----------- -----------Total assets 70,161 52,427 79,082 ----------- ----------- ----------- Current liabilities Trade and otherpayables (54,518) (38,491) (63,656)Current taxliabilities (654) (485) (448)Bank overdrafts (86) (78) (148)Provisions (155) (323) (649)Shares to be issued (1,588) - - ----------- ----------- ----------- (57,001) (39,377) (64,901) ----------- ----------- -----------Net current assets 4,469 5.985 5,825 ----------- ----------- ----------- Non current liabilities Deferred taxliabilities - (164) -Shares to be issued - (1,113) (1,588) ----------- ----------- ----------- - (1,277) (1,588) ----------- ----------- -----------Net assets 13,160 11,773 12,593 =========== =========== =========== Equity Share capital 7 2,358 2,336 2,356Share premiumaccount 7 1,555 1,450 1,547Own shares 7 (173) (173) (173)Revaluation reserve 7 633 567 569Other reserves 7 3,940 3,592 3,907Retained earnings 7 4,847 4,001 4,387 ----------- ----------- -----------Equity attributableto equity holdersof the company 13,160 11,773 12,593 =========== =========== =========== Walker Crips Group plcConsolidated interim cash flowstatementFor the six months ended 30 Unaudited Unaudited AuditedSeptember 2007 Six months to Six months to Year to 30 September 30 September 31 March 2007 2007 2006 £'000 £'000 £'000Operating activities Cash (used in) /generated fromoperations (1,880) 2,321 5,384Interest received 179 85 216Interest paid (3) (12) (14)Tax paid (232) (134) (435) ----------- ----------- -----------Net cash (used in) /generated fromoperating activities (1,936) 2,260 5,151 ----------- ----------- ----------- Investing activitiesJoint ventureinvestment - - (20)Purchase of property,plant and equipment (513) (68) (830)Purchase ofinvestments held fortrading (183) (163) (3)Dividends received 79 77 77 ----------- ----------- -----------Net cash used ininvesting activities (617) (154) (776) ----------- ----------- ----------- Financing activitiesProceeds on issue ofshares 10 64 181Dividends paid (529) (483) (790) ----------- ----------- -----------Net cash used infinancing activities (519) (419) (609) ----------- ----------- ----------- Net (decrease) /increase in cash andcash equivalents (3,072) 1,687 3,766Net Cash and cash equivalents at thestart of the period 6,150 2,384 2,384 ----------- ----------- -----------Net Cash and cashequivalents at the endof the period 3,078 4,071 6,150 ----------- ----------- ----------- Cash and cashequivalents 3,164 4,149 6,298Bank overdrafts (86) (78) (148) ----------- ----------- ----------- 3,078 4,071 6,150 ----------- ----------- -----------Walker Crips Group plcConsolidated interim statement of recognised income and expenseFor the six months Unaudited Unaudited Auditedended 30 September 2007 Six months to Six months to Year to 30 September 30 September 31 March 2007 2007 2006 £'000 £'000 £'000Gain onrevaluation ofavailable-for-saleinvestmentstaken to equity 92 42 43Deferred taxon gains onavailable-for-saleinvestments (28) 10 11Deferred taxon shareoptions - - 275 ----------- ---------- ----------Net incomerecogniseddirectly inequity 64 52 329 Transfers: Profit for theperiod 989 832 1,523 ----------- ---------- ----------Totalrecognisedincome andexpense forthe periodattributableto equityholders of theCompany 1,053 884 1,852 ----------- ---------- ---------- Walker Crips Group plc Notes to the accounts For the six months ended 30 September 2007 1. Basis of preparation and accounting policies The Group's consolidated financial statements are prepared in accordance withInternational Financial Reporting Standards as adopted by the EU (IFRS). Theseinterim financial statements are presented in accordance with IAS 34 Interim Financial Reporting. The interim financial statements have been prepared on the basis of theaccounting policies and methods of computation set out in the Group'sconsolidated financial statements for the year ended 31 March 2007. The interimfinancial statements should be read in conjunction with the Group's auditedfinancial statements for the year ended 31 March 2007. The interim financial information is unaudited and does not constitute statutoryfinancial statements within the meaning of section 240 of the Companies Act1985. The presentation of certain comparative figures has been amended to conform tothe format of recently published financial statements. The Group's financial statements for the year ended 31 March 2007 have beenreported on by the auditors and delivered to the Registrar of Companies. Thereport of the auditors was unqualified and did not draw attention to any mattersby way of emphasis. They also did not contain a statement under section 237(2)or (3) of the Companies Act 1985. Interests in joint ventures The Group's share of the assets, liabilities, income and expenses of jointlycontrolled entities are accounted for in the consolidated financial statementsunder the equity method. Income from the sale or use of the Group's share of the output of jointlycontrolled assets, and its share of the joint venture expenses, are recognisedwhen it is probable that the economic benefits associated with the transactionswill flow to / from the Group and their amount can be measured accurately. Goodwill Goodwill arising on consolidation represents the excess of the cost ofacquisition over the Group's interest in the fair value of the identifiableassets and liabilities of a subsidiary or jointly controlled entity at the dateof acquisition. Goodwill is initially recognised as an asset at cost andreviewed for impairment at least annually. Any impairment is recognisedimmediately in profit or loss and is not subsequently reversed in futureperiods. Intangible assets At each balance sheet date, the Group reviews the carrying amounts of itsintangible assets to determine whether there is any indication that those assetshave suffered an impairment loss. If any such indication exists, the recoverableamount of the asset is estimated in order to determine the extent of theimpairment loss (if any). Where the asset does not generate cash flows that areindependent from other assets, the Group estimates the recoverable amount of thecash-generating unit to which the assets belong. Deferred tax Deferred tax is the tax expected to be payable or recoverable on differencesbetween the carrying amounts of assets and liabilities in the financialstatements and the corresponding tax bases used in the computation of taxableprofits, and is accounted for using the balance sheet liability method. Deferredtax liabilities are generally recognised for all taxable temporary differencesand deferred tax assets are recognised to the extent that is probable thattaxable profits will be available against which deductible temporary differencescan be utilised. Share based compensation The Group operates a number of share option schemes for employees and accountexecutives. The charge to the income statement is determined by the fair valueof the options granted at the date of grant and recognised over the vestingperiod. Principal risks and uncertainties The principal risks and uncertainties faced by the Group continue to be creditrisk and operational risk. These are described in detail in the Annual Reportfor the year ended 31 March 2007. Related party transactions No transactions took place in the period that would materially affect thefinancial position or performance of the group. Related party transactions aredescribed in detail in the Annual Report for the year ended 31 March 2007 2. Segmental analysis 6m to 6m to 12m to Sept Sept MarchRevenue 2007 2006 2007 Stockbroking 6,573 6,101 13,111 Corporate Finance 463 480 861 Financial Services 955 1,061 2,141 Investment Fund Management 1,085 797 1,846 -------- ---------- ---------- 9,076 8,439 17,959 ===== ====== ====== 3. Share Capital On 20 July 2007 a resolution was passed at the annual general meeting tosubdivide each 20p ordinary share of the issued and unissued share capital ofthe Company into 3 ordinary shares of 6 2/3p each. Previously disclosed earningsand dividend per share figures have been amended to reflect this change. 4. Change of Name On 14 August 2007 a resolution was passed at an extraordinary general meeting tochange the Company's name to Walker Crips Group Plc 5. Earnings per share The calculation of basic earnings per share for continuing operations is basedon the post-tax profit for the period of £989,000 (2006 - £832,000) and on34,908,914 (2006 - 34,499,979) ordinary shares of 6 2/3p, being the weightedaverage number of ordinary shares in issue during the period. The effect of options granted and commitments to issue shares in respect ofacquisitions would be to reduce the reported earnings per share. The calculationof diluted earnings per share is based on 36,175,753 (2006 - 35,665,590)ordinary shares, being the weighted average number of ordinary shares in issueduring the period adjusted for dilutive potential ordinary shares. 6. Dividends The interim dividend of 0.94p per share (2006 : 0.88p) is payable on the 14December to shareholders on the register at the close of business on the 23November. The interim dividend has not been included as a liability in thisinterim report. Walker Crips Group plc Notes totheaccounts(continued)For the sixmonthsended 30September2007 7. Reserves Called up Share Own shares Capital Other Revaluation Retained Total and share capital premium held Redemption earnings Equityretainedearnings £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Equity as at 1 2,326 1,396 (173) 111 3,437 515 3,654 11,266April 2006 Revaluationofinvestment 42 42atfair valueDeferredtax 10 10charge Profit forthe6 monthsended 832 83230 --------- --------- --------- --------- --------- --------- --------- ---------September2006Totalrecognisedincome andexpense forthe period 52 832 884March 2006final (485) (485)dividendShare-basedpayments 44 44Issue ofshares onexercise ofoptions 10 54 64 --------- --------- --------- --------- --------- --------- --------- ---------Equity asat 30September 2,336 1,450 (173) 111 3,481 567 4,001 11,7732006 Revaluationofinvestment 2 2atfair valueDeferred - -tax chargeExcessdeferredtaxon share 275 275optionsProfit forthe6 months 691 691ended --------- --------- --------- --------- --------- --------- --------- ---------31 March2007Totalrecognisedincome andexpense forthe period 275 2 691 968September2006interim (305) (305)dividendShare-basedpayments 40 40Issue ofshares onexercise ofoptions 20 97 117 --------- --------- --------- --------- --------- --------- --------- ---------Equity asat 2,356 1,547 (173) 111 3,796 569 4,387 12,59331 March2007 Revaluationofinvestment 92 92atfair valueDeferredtax (28) (28)creditProfit forthe6 monthsended 989 98930 --------- --------- --------- --------- --------- --------- --------- ---------September2007Totalrecognisedincome andexpense forthe period 64 989 1,053March 2007final (529) (529)dividendShare-basedpayments 33 33Issue ofshares onexercise ofoptions 2 8 10 --------- --------- --------- --------- --------- --------- --------- ---------Equity asat30 2,358 1,555 (173) 111 3,829 633 4,847 13,160September2007 Directors' Responsibility Statement The Directors confirm that to the best of their knowledge: (a) The condensed set of financial statements contained within the half yearlyfinancial report has been prepared in accordance with IAS 34 ' Interim FinancialReporting' as adopted by the EU; (b) The half yearly report from the Chairman (constituting the interimmanagement report) includes a fair review of the information required by DTR4.2.7R; and (c) The half yearly report from the Chairman includes a fair review of theinformation required by DTR 4.2.8R as far as applicable. On Behalf of the Board Rodney FitzGerald Chief Executive Officer 13 November 2007 This information is provided by RNS The company news service from the London Stock Exchange