REG - Begbies Traynor - Half-year Results
10/12/2024 07:00
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RNS Number : 4038P Begbies Traynor Group PLC 10 December 2024
10 December 2024
Begbies Traynor Group plc
Half year results
for the six months ended 31 October 2024
"Strong financial performance with high double-digit revenue and profit
growth"
Begbies Traynor Group plc (the 'company' or the 'group'), the professional
services consultancy, today announces its half year results for the six months
ended 31 October 2024.
Financial overview
2024 2023
£m £m
Revenue 76.3 65.9
Adjusted EBITDA(1) 15.3 12.8
Adjusted profit before tax(2) 11.5 9.9
Profit before tax 4.7 3.0
Adjusted diluted EPS(2) (p) 5.1 4.6
Diluted EPS (p) 1.3 0.8
Interim dividend (p) 1.4 1.3
Net (debt) cash(3) (3.8) 1.1
Financial highlights - strong first half building on decade long track record
of profitable growth
· Revenue growth of 16% (11% organic, 5% acquired)
· Adjusted EBITDA growth of 20% reflecting revenue growth and
improved margins
· Adjusted profit before tax growth of 16%
· Increase in interim dividend extends our seven consecutive years
of dividend growth since 2017
· Strong financial position and significant levels of headroom
within committed bank facilities
o Free cash flow increased by 8%
o Net debt position at 31 October reflects significant payments in the
period (acquisition earn outs of £4.1m, share buy-backs of £0.8m and
dividends of £2.0m)
o Well placed to continue investing in successful organic and acquisitive
growth strategy
Operating highlights - double digit organic growth across both divisions
· Business recovery and advisory
o Increased year on year insolvency activity levels in higher value cases
o Market-leading position maintained (by volume of appointments)
o Strong growth in advisory income reflecting benefit of recent investment
and growth of the team through senior hires
· Property advisory
o Asset sales: strong growth driven by property auction volumes (organic and
acquired)
o Consultancy: continuing organic growth in building consultancy
instructions together with on-going investment in growing the team
o Valuations: robust activity levels reflecting supportive market volumes
Current trading and outlook - in line with expectations
· Confident of delivering full year results in line with current
market expectations(4)
o Supportive market conditions and good activity levels across the business
o Extending the group's strong financial track record of growth
· On track to deliver medium-term revenue target of £200m
· Q3 trading update will be issued in late February 2025
1 Adjusted EBITDA is operating profit before share based
payments, depreciation, amortisation and non-underlying items arising due to
acquisitions under IFRS.
2 Adjusted PBT is before non-underlying items arising due to
acquisitions under IFRS. Adjusted EPS excludes these items and the related tax
effect. The board believe that these adjusted performance measures provide
more meaningful information on the operating performance of the business.
3 Net debt (cash) includes cash and cash equivalents and
borrowings but excludes IFRS 16 lease liabilities.
4 Current range of analyst forecasts for adjusted PBT of
£23.0m-£24.3m (as compiled by the group)
Commenting on the results, Ric Traynor, Executive Chairman of Begbies Traynor
Group, said:
"I am pleased to report a strong first half performance in which we have
continued to execute our strategy to grow the business, reporting high
double-digit growth in revenue and profit.
"This builds on a decade of profitable growth, which has been driven by
investing in organic development and earnings enhancing M&A. Since 2014 we
have tripled the size of the business with a six-fold increase in adjusted
profit before tax. Building on this track record, we are making good progress
towards our medium-term revenue target of £200m.
"Market conditions remain supportive for the group's service lines which is
reflected in our current activity levels and positive momentum across the
business. This, together with our financial performance in the first six
months, leaves the board confident of delivering current market expectations
for the full year, which will extend our longstanding track record of strong,
profitable growth."
There will be a webcast and conference call for analysts today at 9:00am.
Please contact begbies@mhpgroup.com (mailto:begbies@mhpgroup.com) if you
would like to receive details.
Enquiries please contact:
Begbies Traynor Group plc
0161 837 1700
Ric Traynor - Executive Chairman
Nick Taylor - Group Finance Director
Canaccord Genuity Limited
020 7523 8350
(Nominated Adviser and Joint Broker)
Emma Gabriel / Harry Pardoe
Shore Capital
020 7408 4090
(Joint Broker)
Malachy McEntyre / Mark Percy / Anita Ghanekar / James Thomas
MHP
07595 461 231
Reg Hoare / Katie Hunt / Charles Hirst
begbies@mhpgroup.com
Notes to editors
Begbies Traynor Group plc is a leading UK advisory firm with expertise in
business recovery, advisory and corporate finance, valuations, asset sales and
property consultancy.
We have 1,300 colleagues operating from 45 locations across the UK, together
with four offshore offices. Our multidisciplinary professional teams include
insolvency practitioners, accountants, lawyers, funding professionals and
chartered surveyors.
· Business recovery
o Corporate and personal insolvency; contentious insolvency; creditor
services
· Advisory and corporate finance
o Debt advisory and finance broking; corporate finance; special situations
M&A; financial advisory
· Valuations
o Property, business and asset valuations
· Asset sales
o Property, plant and machinery auctions; property and business sales agency
· Property consultancy
o Building consultancy; transport planning; commercial property management;
insurance and protection
Further information can be accessed via the group's website at
https://ir.begbies-traynorgroup.com/ (https://ir.begbies-traynorgroup.com/)
.
CHAIRMAN'S STATEMENT
INTRODUCTION
I am pleased to report a strong first half performance in which we have
continued to execute our strategy to grow the business, reporting high
double-digit revenue and profit growth.
We have a proven growth strategy which has delivered a decade of profitable
growth. This has been driven by investing in organic development and earnings
enhancing M&A, resulting in a diversified and resilient business. Since
2014 we have tripled the size of the business with a six-fold increase in
adjusted profit before tax. Building on this track record, we are making good
progress towards our medium-term revenue target of £200m.
Business recovery has continued to grow organically with increased activity
levels, notably in higher value cases. It remains the group's largest service
line and retains its leadership position in the UK market. We are ranked
number one by overall volume of corporate appointments, second nationally for
administrations and are well placed to continue delivering growth.
Our advisory teams reported strong organic growth in the period driven by
instructions across restructuring, debt advisory, finance broking, special
situations M&A and financial advisory. Advisory services have been an area
of investment for us and we have expanded our team organically in the period
through recruiting senior fee earners. As part of the development of this
business, we released the first two episodes of the BTG Advisory Restructuring
Round-Up podcast. These include a discussion on the current restructuring
landscape and a discussion on the complementary advisory services provided by
the group.
Our property advisory division was created ten years ago with the acquisition
of Eddisons in December 2014. In that period we have significantly increased
its scale, service offering and geographic presence driving annual revenue
from c.£12m at inception to a current run rate in excess of £45m. Over this
ten year trading period the business has demonstrated resilience through the
cycle and reported strong growth in revenue and profits.
We have maintained this track record in the period with further strong growth,
reflecting the benefits of the continuing organic development of the business
and the full year impact of prior year acquisitions.
Across the group, we continue to invest in our people and processes. We have
made further progress in developing the learning and development support we
provide to our colleagues, with bespoke training courses across a broad range
of key skills. We also continue to enhance our processes through increased use
of technology to improve efficiency and working practices. We will continue
to focus on driving efficiencies in the way we work as we face the headwind of
increased employment costs from April 2025 following the October 2024 UK
budget.
We remain in a strong financial position with free cash flow in the period
increasing by 8%. Our net debt position at 31 October 2024 of £3.8m
reflects the payment of acquisition earn outs of £4.1m, share buy-backs of
£0.8m and dividends of £2.0m (30 April 2024: net debt of £1.4m, 31 October
2023: net cash of £1.1m). We have significant headroom in our overall debt
facilities of £35m.
Our cash generation, combined with our debt facilities, provides us with the
flexibility to execute our strategy to continue to grow our scale and range of
services both organically and through acquisition.
RESULTS
Group revenue in the half year ended 31 October 2024 increased by 16% to
£76.3m (2023: £65.9m). Adjusted EBITDA(1) increased by 20% to £15.3m (2023:
£12.8m). Adjusted profit before tax(2) increased by 16% to £11.5m (2023:
£9.9m). Statutory profit before tax increased by 57% to £4.7m (2023:
£3.0m).
Adjusted diluted earnings per share(2) increased by 11% to 5.1p (2023: 4.6p).
Diluted earnings per share was 1.3p (2023: 0.8p).
Net debt(3) as at 31 October 2024 was £3.8m (30 April 2024: net debt of
£1.4m, 31 October 2023: net cash of £1.1m), after acquisition earn out
payments of £4.1m, share buy-backs of £0.8m and dividends of £2.0m.
1. Adjusted EBITDA is operating profit before share based payments,
depreciation, amortisation and non-underlying items arising due to
acquisitions under IFRS.
2. Adjusted PBT is before non-underlying items arising due to
acquisitions under IFRS. Adjusted EPS excludes these items and the related tax
effect. The board believe that these adjusted performance measures provide
more meaningful information on the operating performance of the business.
3. Net debt (cash) includes cash and cash equivalents and borrowings
but excludes IFRS 16 lease liabilities.
DIVIDEND
The board is pleased to declare an 8% increase in the interim dividend to 1.4p
(2023: 1.3p), which will extend our seven consecutive years of dividend growth
since 2017 and reflects our confidence in sustaining our financial track
record and in the group's financial position and prospects. We remain
committed to a long-term progressive dividend policy, which takes account of
the group's earnings growth, our investment plans and cash requirements,
together with the market outlook.
The interim dividend will be paid on 7 May 2025 to shareholders on the
register on 11 April 2025, with an
ex-dividend date of 10 April 2025.
OUTLOOK
The group's financial performance in the first six months underpins the
board's confidence in delivering current market expectations(1) for the full
year, which will extend our strong financial track record of growth.
Market conditions remain supportive for the group's service lines and this is
reflected in good activity levels and positive momentum across the business.
UK insolvencies remain at elevated levels. We anticipate continuing growth in
business recovery, our largest service line, as businesses face continuing
demand pressures and cost challenges, including the recent rise in costs
following the budget and the prospect of higher-for-longer interest rates.
With our expanded team, we have the capacity and breadth of expertise to
provide the advice and support required by our clients in such circumstances.
We continue to invest and develop our advisory team, which has a healthy
pipeline of engagements.
Our property advisory teams have ongoing positive momentum and are well-placed
to maintain their strong financial performance from the first half year across
our three key areas of asset sales, consultancy and valuations.
Our broad range of services, diversified client base, organic growth
initiatives and pipeline of acquisition opportunities, leaves us confident of
continuing to build upon our strong track record of growth in the current year
and beyond.
We will provide an update on third quarter trading in late February 2025.
1. Current range of analyst forecasts for adjusted PBT of
£23.0m-£24.3m (as compiled by the group)
Ric Traynor
Executive Chairman
10 December 2024
BUSINESS REVIEW
OPERATING REVIEW
Operating result
Strong operating performance in the period increasing revenue by £10.4m to
£76.3m (2023: £65.9m), an overall increase of 16% (11% organic, 5%
acquired). Operating profits increased by £1.9m (18%) to £12.6m (2023:
£10.7m).
Operating performance by segment is detailed below:
6 months to 6 months to % growth
31 Oct 2024 31 Oct 2023
£m £m
Revenue
Business recovery and advisory 52.8 47.0 12% (12% organic)
Property advisory 23.5 18.9 24% (8% organic)
76.3 65.9 16% (11% organic)
Operating profit
Business recovery and advisory 13.6 11.6 17%
Property advisory 3.9 3.5 11%
Group services (4.9) (4.4) 11%
12.6 10.7 18%
Margins
Segmental margins
· Business recovery and advisory 25.8% 24.7%
· Property advisory 16.6% 18.5%
Group services as % of revenue 6.4% 6.7%
Operating margins 16.5% 16.2%
Operating margins improved to 16.5% (2023: 16.2%) reflecting:
· business recovery and advisory improved margins reflecting
improved activity levels;
· property advisory margins normalised following additional
consultancy fees in the prior year (as previously reported) together with
organic investment;
· group services costs as a percentage of revenue reduced.
Markets
The marketplace for our advisory services continues to provide a positive
environment for developing and growing the group.
Insolvency
Corporate insolvencies remained at elevated levels in the 12 months ended 31
October 2024(1) with 24,428 appointments (2023: 24,644). The total number of
administrations (which typically involve larger and more complex instructions)
in the 12 month period was 1,578 (2023: 1,575), which remains below the
pre-pandemic levels in 2019 of c.1,800 appointments.
Commercial property
The property advisory business has benefitted from supportive market activity
levels. In the 12 months ended 30 September 2024 there were 120,100 UK
non-residential property transactions(2) (2023: 119,120). This extends the
period of stable transaction levels experienced since 2021, albeit this is
c.6% below pre-pandemic levels. In addition, lending to UK real estate SMEs(3)
increased to £60.0bn at 30 September 2024 (2023: £57.7bn).
(1. Insolvency Service statistics on the number of corporate insolvencies
in England and Wales on a seasonally adjusted basis for the 12 months ended 31
October)
(2. HMRC UK monthly property transactions commentary updated 31 October
2024)
(3. Bank of England Bankstats tables showing loan amounts outstanding to
UK small and medium-sized enterprises of which buying, selling and renting of
own or leased real estate (ZKP5))
( )
Business recovery and advisory
Our business recovery teams have experienced increased demand in the period,
notably in higher value cases. As the UK market-leader by volume we continue
to benefit from our extensive national coverage and strong digital marketing
presence.
Insolvency revenue increased by 7% in the period to £41.4m (2023: £38.8m)
and the insolvency order book (including both contingent and non-contingent
fees) increased to £76.4m (30 April 2024: £71.9m, 31 October 2023: £70.3m).
The non-contingent element increased to £38.8m (30 April 2024: £36.3m, 31
October 2023: £35.0m).
Notable insolvency appointments during the period included the administrations
of Caskade Group and Island Poke (hospitality), Strabens Hall (financial
services), Beck Interiors (construction) and AAD Transport (haulage), together
with a number of large restructuring engagements.
Our advisory team reported strong growth in the period with revenue increasing
by 39% to £11.4m (2023: £8.2m) across our range of restructuring, debt
advisory, finance broking, special situations M&A and financial advisory
services. Corporate finance activities remained subdued reflecting general
uncertainty in the lead up to the October 2024 UK budget.
We have continued to invest in growing our advisory team and have appointed
four partners and one director across our London, Manchester and Leeds
offices. Their expertise covers special situations M&A, forensics and
financial advisory. This expanded team will continue to develop and enhance
our reputation for larger and more complex instructions across both formal
insolvency and advisory. On these appointments, we are able to deliver the
best value to stakeholders from leveraging our broad range of expertise across
restructuring, debt advisory, funding, valuations and asset sales.
Property advisory
We have seen strong growth in the period from our asset sales team, driven by
property auctions. Following the acquisition of SDL Property Auctions in
December 2023, we have made good progress in its integration, which will be
completed later this financial year. In the period we experienced organic
growth in auction lots across the combined business reflecting both our strong
market position and a growing market backdrop.
Our building consultancy team, delivering projects and development activity,
continued to expand in the period, with increased activity levels across a
broad client base. We have continued to invest organically in growing the team
during the period, including enhancing our sustainability expertise.
We reported increased revenue from our valuations team following the prior
year acquisition and integration of the Andrew Forbes valuation practice in
November 2023. Organic activity levels were robust, reflecting the stable
market environment.
We have continued to invest in growing our team in the period through
recruiting experienced chartered surveyors notably in our building consultancy
and valuations teams.
People and processes
The average number of full-time equivalent (FTE) partners and employees
working in the group over the period increased due to both organic investment
and prior year acquisitions. Over the last year, the number of fee-earning
colleagues in the group increased by 7% to 947 (3% since the start of the
financial year).
6 months to 6 months to
31 Oct 2024 31 Oct 2023
Business recovery Property advisory Group services Total Business recovery and advisory Property advisory Group services Total
and advisory
Fee earners 596 351 - 947 566 320 - 886
Support teams 64 23 67 154 77 24 64 165
Total 660 374 67 1,101 643 344 64 1,051
We have continued to invest in our people, notably through continuing to
enhance our learning and development support. During the period, we delivered
a leadership development programme to over 200 of our senior business
leaders. We also commenced a series of 'live-learns' providing convenient
remote training sessions on core skills which have included maximising the
benefit of Microsoft tools, using LinkedIn for business development and the
opportunities of AI across the workplace. We have gained CPD accreditation for
a number of our courses which enables our professionals to complete an element
of their professional development on bespoke in-house courses.
In the period, we launched our fourth save as you earn scheme for all
qualifying colleagues.
We have continued to make progress in our process improvement initiatives
across our operations to identify and embed improved ways of working, making
the best use of technology.
FINANCE REVIEW
Financial summary
6 months to 31 Oct 2024 6 months to 31 Oct 2023 12 months to 30 Apr 2024
£m £m £m
Revenue 76.3 65.9 136.7
Adjusted EBITDA 15.3 12.8 28.5
Share-based payments (0.5) (0.2) (0.6)
Depreciation (2.2) (1.9) (4.0)
Operating profit (before non-underlying items) 12.6 10.7 23.9
Finance costs (1.1) (0.8) (1.9)
Adjusted profit before tax 11.5 9.9 22.0
Non-underlying items (6.8) (6.9) (16.2)
Profit before tax 4.7 3.0 5.8
Tax on profits on ordinary activities (2.5) (1.8) (4.3)
Profit for the period 2.2 1.2 1.5
Adjusted EBITDA increased by 20% to £15.3m (2023: £12.8m) with non-cash
costs (share-based payments and depreciation) increasing to £2.7m (2023:
£2.1m).
Finance costs increased to £1.1m (2023: £0.8m) principally due to higher
levels of net debt following the prior year purchase of own shares and higher
IFRS 16 interest charges.
Adjusted profit before tax increased by 16% to £11.5m (2023: £9.9m).
Non-underlying items
The non-underlying items detailed below all arise due to acquisition
accounting.
Under IFRS, acquisition consideration which is contingent on the selling
shareholders remaining with the group is charged to the statement of
comprehensive income, rather than being capitalised within non-current assets.
These contingent payments, agreed in the terms of the sale and purchase
agreements, are designed to preserve the value of goodwill and customer
relationships acquired in the business combinations. As a result of this
treatment of consideration, negative goodwill arises on a number of
acquisitions which is credited to income in the year of acquisition.
6 months to 31 Oct 2024 6 months to 31 Oct 2023 12 months to 30 Apr 2024
£m £m £m
Acquisition consideration (deemed remuneration in accordance 4.9 4.5 11.1
with IFRS 3)
Negative goodwill (gain on acquisition) - (0.7) (0.8)
Transaction costs - 0.1 0.3
Amortisation of intangible assets recognised on acquisition 1.9 3.0 5.6
accounting
6.8 6.9 16.2
Tax
The overall tax charge for the period was £2.5m (2023: £1.8m) as detailed
below:
6 months to 31 Oct 2024 6 months to 31 Oct 2023
Profit before tax Tax Profit after tax Effective rate Profit before tax Tax Profit after tax Effective rate
£m £m £m £m £m £m
Adjusted 11.5 (3.0) 8.5 26% 9.9 (2.6) 7.3 26%
Non-underlying items:
Amortisation (1.9) 0.5 (1.4) 25% (3.0) 0.8 (2.2) 25%
Other non-underlying items (4.9) - (4.9) - (3.9) - (3.9) -
Tax on ordinary activities 4.7 (2.5) 2.2 53% 3.0 (1.8) 1.2 60%
The adjusted tax rate of 26% is based on the expected rate for the full year.
Earnings per share (EPS)
Adjusted basic EPS(1) increased by 17% to 5.4p (2023: 4.6p) resulting from the
growth in adjusted earnings. Basic EPS increased to 1.4p (2023: 0.8p).
Adjusted diluted EPS(1) increased by 11% to 5.1p (2023: 4.6p), reflecting
increased dilutive potential ordinary shares following the granting of options
under the group's performance share plan and the maturity of equity settled
earn out obligations. Diluted earnings per share increased to 1.3p (2023:
0.8p).
(1. See reconciliation in note 5)
Liquidity
The group remains in a strong financial position. At 31 October 2024, the
group had net debt of £3.8m (30 April 2024: net debt of £1.4m, 31 October
2023: net cash of £1.1m), represented by cash balances of £4.2m (2023:
£8.1m) net of drawn borrowing facilities of £8.0m (2023: £7.0m). All bank
covenants were comfortably met during the period.
We have significant levels of headroom in our bank facilities which are
committed until February 2027, with two one-year extension options, giving a
potential maturity date of February 2029.
Our total facilities of £35m comprise:
· £25m committed, unsecured revolving credit facility.
· £10m accordion facility, allowing further debt capacity to
support the group's growth strategy, subject to certain conditions.
Cash flow
Cash flow in the period is summarised as follows:
6 months to 6 months to 12 months to 30 Apr 2024
31 Oct 2024 31 Oct 2023 £m
£m £m
Adjusted EBITDA 15.3 12.8 28.5
Working capital (5.7) (4.6) (4.0)
Cash generated by operations 9.6 8.2 24.5
Tax (1.9) (1.8) (6.7)
Interest (1.0) (0.9) (2.0)
Capital expenditure (1.0) (0.8) (1.5)
Capital element of lease payments (1.4) (0.7) (1.9)
Free cash flow 4.3 4.0 12.4
Acquisition consideration payments (net of cash acquired)(1) (4.1) (3.9) (8.2)
Transaction costs - (0.1) (0.3)
Purchase of own shares (0.8) - (2.9)
Net proceeds from share issues 0.2 - 0.5
Dividends (2.0) (1.9) (5.9)
Net cash outflow (2.4) (1.9) (4.4)
Cash from operating activities (before acquisition consideration payments) was
£9.6m (2023: £8.2m) due to increased EBITDA of £2.5m. Working capital
absorption of £5.7m (2023: £4.6m) resulted from organic revenue growth and
annual profile of payments (prior-year bonuses paid and prepaid annual costs).
Lock up(2) at 31 October 2024 was 4.3 months (30 April 2024: 4.2 months, 31
October 2023: 4.0 months).
Free cash flow in the period increased by 8% to £4.3m (2023: £4.0m).
Acquisition consideration payments of £4.1m in the period related to
contingent payments in respect of prior year acquisitions. Following these
payments, the estimate of future contingent consideration payments is £15.2m,
which will be satisfied by December 2027.
The purchase of own shares of £0.8m related to EBT share purchases of £0.1m
and the share buyback programme (announced on 21 October 2024) of £0.7m.
The share buyback programme completed on 7 November 2024.
(1. Including deemed remuneration under IFRS3)
(2. Lock up determined by unbilled income and trade receivables (net of
impairment provision) less deferred income compared to TTM revenue)
Net assets
Net assets as at 31 October 2024 were £76.3m, compared to £78.4m as at 30
April 2024. The movement represents an increase of £8.5m from post-tax
adjusted earnings, £2.1m from shares issued by the EBT and £0.7m for credit
to equity for share based payments and other share issues, offset by dividends
of £6.3m and the post-tax impact of acquisition-related transaction and
amortisation costs of £6.3m and £0.8m in relation to shares acquired as part
of the share buy back.
Ric Traynor
Nick Taylor
Executive
chairman
Group finance director
10 December
2024
10 December 2024
Consolidated statement of comprehensive income
Six months ended Six months ended Year ended
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
Underlying Non-underlying Total Underlying Non-underlying Total Underlying Non-underlying Total
Note £m £m £m £m £m £m £m £m £m
Revenue 2 76.3 - 76.3 65.9 - 65.9 136.7 - 136.7
Direct costs (43.9) - (43.9) (38.1) - (38.1) (77.8) - (77.8)
Gross profit 32.4 - 32.4 27.8 - 27.8 58.9 - 58.9
Other operating income 0.2 - 0.2 0.4 - 0.4 0.5 - 0.5
Administrative expenses (20.0) (6.8) (26.8) (17.5) (6.9) (24.4) (35.5) (16.2) (51.7)
Operating profit 2 12.6 (6.8) 5.8 10.7 (6.9) 3.8 23.9 (16.2) 7.7
Finance costs 4 (1.1) - (1.1) (0.8) - (0.8) (1.9) - (1.9)
Profit before tax 11.5 (6.8) 4.7 9.9 (6.9) 3.0 22.0 (16.2) 5.8
Tax on profits on ordinary activities (3.0) 0.5 (2.5) (2.6) 0.8 (1.8) (5.7) 1.4 (4.3)
Profit and total comprehensive income for the period 8.5 (6.3) 2.2 7.3 (6.1) 1.2 16.3 (14.8) 1.5
Earnings per share
Basic 5 1.4p 0.8p 0.9p
Diluted 5 1.3p 0.8p 0.9p
All of the profit and comprehensive income for the period is attributable to
equity holders of the parent.
Consolidated statement of changes in equity
For the six months ended 31 October 2024 (unaudited) Share capital Share premium Merger reserve Capital redemption reserve Own shares reserve Retained earnings Total equity
£m £m £m £m £m £m £m
At 1 May 2024 8.0 30.5 28.3 0.3 (2.9) 14.2 78.4
Total comprehensive income for the period - - - - - 2.2 2.2
Dividends - - - - - (6.3) (6.3)
Credit to equity for equity-settled share-based payments - - - - - 0.5 0.5
Other share options - 0.2 - - - - 0.2
Own shares acquired - - - - (0.8) - (0.8)
Own shares issued - - - - 2.8 (0.7) 2.1
At 31 October 2024 8.0 30.7 28.3 0.3 (0.9) 9.9 76.3
For the six months ended 31 October 2023 (unaudited) Share capital Share premium Merger reserve Capital redemption reserve Own shares reserve Retained earnings Total equity
£m £m £m £m £m £m £m
At 1 May 2023 7.7 30.0 27.9 0.3 - 18.4 84.3
Total comprehensive income for the period - - - - - 1.2 1.2
Dividends - - - - - (5.9) (5.9)
Shares issued as consideration for acquisitions - - 0.4 - - - 0.4
Other share options 0.2 - - - - - 0.2
At 31 October 2023 7.9 30.0 28.3 0.3 - 13.7 80.2
For the year ended 30 April 2024 (audited) Share capital Share premium Merger reserve Capital redemption reserve Own shares reserve Retained earnings Total equity
£m £m £m £m £m £m £m
At 1 May 2023 7.7 30.0 27.9 0.3 - 18.4 84.3
Total comprehensive income for the period - - - - - 1.5 1.5
Dividends - - - - - (5.9) (5.9)
Credit to equity for equity-settled share-based payments - - - - - 0.5 0.5
Shares issued as consideration for acquisitions - - 0.4 - - - 0.4
Other share options 0.3 0.5 - - - (0.3) 0.5
Own shares acquired - - - - (2.9) - (2.9)
At 30 April 2024 8.0 30.5 28.3 0.3 (2.9) 14.2 78.4
Consolidated balance sheet
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
Note £m £m £m
Non-current assets
Intangible assets 70.5 71.0 72.4
Property, plant and equipment 2.6 2.2 2.2
Right of use assets 10.9 9.7 11.2
Trade and other receivables 7 1.4 4.8 2.8
85.4 87.7 88.6
Current assets
Trade and other receivables 7 69.5 60.2 63.3
Current tax receivable - - 0.3
Cash and cash equivalents 4.2 8.1 5.6
73.7 68.3 69.2
Total assets 159.1 156.0 157.8
Current liabilities
Trade and other payables 8 (52.0) (46.2) (50.0)
Current tax liabilities (0.9) (2.0) -
Lease liabilities (2.8) (2.2) (2.1)
Provisions (1.2) (1.1) (0.9)
(56.9) (51.5) (53.0)
Net current assets 16.8 16.8 16.2
Non-current liabilities
Borrowings (8.0) (7.0) (7.0)
Lease liabilities (8.6) (8.2) (9.5)
Provisions (2.8) (2.3) (2.9)
Deferred tax (6.5) (6.8) (7.0)
(25.9) (24.3) (26.4)
Total liabilities (82.8) (75.8) (79.4)
Net assets 76.3 80.2 78.4
Equity
Share capital 8.0 7.9 8.0
Share premium 30.7 30.0 30.5
Merger reserve 28.3 28.3 28.3
Capital redemption reserve 0.3 0.3 0.3
Own shares reserve (0.9) - (2.9)
Retained earnings 9.9 13.7 14.2
Equity attributable to owners of the company 76.3 80.2 78.4
Consolidated cash flow statement
Six months ended Six months ended Year ended
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
Note £m £m £m
Cash generated by operations 9 9.6 8.2 24.5
Income taxes paid (1.9) (1.8) (6.7)
Interest paid on borrowings (0.6) (0.6) (1.2)
Interest paid on lease liabilities (0.4) (0.3) (0.8)
Net cash from operating activities (before acquisition payments)
6.7 5.5 15.8
Transaction costs - (0.1) (0.3)
Acquisition consideration payments (which are deemed remuneration under IFRS (4.1) (4.3) (6.3)
3)
Net cash from operating activities 2.6 1.1 9.2
Investing activities
Purchase of property, plant and equipment (1.0) (0.8) (1.5)
Acquisition consideration payments - (0.2) (3.5)
Net cash acquired in acquisition of businesses - 0.6 1.6
Net cash used in investing activities (1.0) (0.4) (3.4)
Financing activities
Dividends paid (2.0) (1.9) (5.9)
Proceeds on issue of shares 0.2 - 0.5
Purchase of own shares (0.8) - (2.9)
Capital element of lease payments (1.4) (0.7) (1.9)
Drawdown of loans 1.0 2.0 2.0
Net cash used in financing activities (3.0) (0.6) (8.2)
Net (decrease) increase in cash and cash equivalents (1.4) 0.1 (2.4)
Cash and cash equivalents at beginning of period 5.6 8.0 8.0
Cash and cash equivalents at end of period 4.2 8.1 5.6
1. Basis of preparation and accounting policies
(a) Basis of preparation
The half year condensed consolidated financial statements do not include all
of the information and disclosures required for full annual financial
statements and should be read in conjunction with the group's annual financial
statements as at 30 April 2024, which have been prepared in accordance with UK
adopted International Accounting Standards.
This condensed consolidated half year financial information does not comprise
statutory accounts within the meaning of Section 435 of the Companies Act
2006. Statutory accounts for the year ended 30 April 2024 were approved by the
board of directors on
8 July 2024 and delivered to the Registrar of Companies. The report of the
auditor on those accounts was unqualified, did not include a reference to any
matters to which the auditor drew attention by way of emphasis without
qualifying their report and did not contain statements under section 498 (2)
or (3) of the Companies Act 2006.
The directors have reviewed the financial resources available to the group and
have concluded that the group is a going concern. This conclusion is based
upon, amongst other matters, a review of the group's financial projections for
a period of twelve months following the date of this announcement, together
with a review of the cash and committed borrowing facilities available to the
group. Accordingly, the going concern basis has been used in preparing these
half year condensed consolidated financial statements.
The condensed consolidated financial statements for the six months ended 31
October 2024 have not been audited nor subject to an interim review by the
auditors. IAS 34 'Interim financial reporting' is not applicable to these
half year condensed consolidated financial statements and has therefore not
been applied.
(b) Significant accounting policies
The accounting policies adopted in preparation of the half year condensed
consolidated financial statements are consistent with those followed in the
preparation of the group's annual financial statements for the year ended 30
April 2024.
2. Segmental analysis by class of business
Six months ended Six months ended Year ended
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
£m £m £m
Revenue
Business recovery and financial advisory 52.8 47.0 96.4
Property advisory 23.5 18.9 40.3
76.3 65.9 136.7
Operating profit before non-underlying items
Business recovery and financial advisory 13.6 11.6 25.5
Property advisory 3.9 3.5 7.6
Group services (4.9) (4.4) (9.2)
12.6 10.7 23.9
3. Non-underlying items
Six months ended Six months ended Year ended
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
£m £m £m
Acquisition consideration (deemed remuneration in accordance with IFRS 3) 4.9 4.5 11.1
Transaction costs - 0.1 0.3
Negative goodwill - (0.7) (0.8)
Amortisation of intangible assets arising on acquisitions 1.9 3.0 5.6
6.8 6.9 16.2
4. Finance costs
Six months ended Six months ended Year ended
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
£m £m £m
Interest on bank loans 0.6 0.5 1.2
Finance charge on lease liabilities 0.4 0.3 0.6
Finance charge on dilapidations provisions 0.1 - 0.1
1.1 0.8 1.9
5. Earnings per share
The calculation of the basic and diluted earnings per share is based on the
following data:
Six months ended Six months ended Year ended
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
£m £m £m
Earnings
Profit for the period attributable to equity holders 2.2 1.2 1.5
31 October 2024 (unaudited) 31 October 2023 30 April 2024 (audited)
(unaudited)
million million million
Number of shares
Weighted average number of ordinary shares for the purposes of basic earnings 158.5 158.1 158.5
per share
Effect of dilutive potential ordinary shares:
Share options 5.1 1.6 5.3
Contingent shares 1.8 - -
Weighted average number of ordinary shares for the purposes of diluted 165.4 159.7 163.8
earnings per share
Six months ended Six months ended Year ended
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
pence pence pence
Basic earnings per share 1.4 0.8 0.9
Diluted earnings per share 1.3 0.8 0.9
The following additional earnings per share figures are presented as the
directors believe they provide a better understanding of the trading position
of the group, as they exclude the accounting charges which arise due to
acquisitions in accordance with IFRS 3 and are not influenced by the
day-to-day operations of the group.
Six months ended Six months ended Year ended
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
£m £m £m
Earnings
Profit for the period attributable to equity holders 2.2 1.2 1.5
Non-underlying items 6.8 6.9 16.2
Tax effect of above items (0.5) (0.8) (1.4)
Adjusted earnings 8.5 7.3 16.3
Six months ended Six months ended Year ended
31 October 2024 31 October 2023 30 April 2024
(unaudited) (unaudited) (audited)
pence pence pence
Adjusted basic earnings per share 5.4 4.6 10.3
Adjusted diluted earnings per share 5.1 4.6 9.9
6. Dividends
The interim dividend of 1.4p (2023: 1.3p) per share (not recognised as a
liability at 31 October 2024) will be payable on 7 May 2025 to ordinary
shareholders on the register at 11 April 2025. The final dividend of 2.7p per
share as proposed in the 30 April 2024 financial statements and approved at
the group's AGM was paid on 6 November 2024 and was recognised as a liability
at 31 October 2024.
7. Trade and other receivables
31 October 2024 (unaudited) 31 October 2023 30 April 2024 (audited)
(unaudited)
£m £m £m
Non current
Deemed remuneration 1.4 4.8 2.8
Current
Trade receivables 14.2 11.3 13.0
Unbilled income 49.2 41.6 45.3
Other debtors and prepayments 4.4 4.0 2.8
Deemed remuneration 1.7 3.3 2.2
69.5 60.2 63.3
8. Trade and other payables
31 October 2024 (unaudited) 31 October 2023 30 April 2024 (audited)
(unaudited)
£m £m £m
Current
Trade payables 2.2 2.7 2.4
Accruals 10.4 9.8 12.1
Final dividend 4.2 4.1 -
Other taxes and social security 5.7 5.2 5.2
Deferred income 7.9 7.0 7.4
Other creditors 16.7 14.1 17.0
Deferred consideration 0.9 - 0.9
Deemed remuneration liabilities 4.0 3.3 5.0
52.0 46.2 50.0
9. Reconciliation to the cash flow statement
31 October 2024 (unaudited) 31 October 2023 30 April 2024 (audited)
(unaudited)
£m £m £m
Profit for the period 2.2 1.2 1.5
Adjustments for:
Tax 2.5 1.8 4.3
Finance costs 1.1 0.8 1.9
Depreciation of property, plant and equipment 0.6 0.6 1.1
Depreciation of right of use assets 1.5 1.2 2.7
Amortisation of intangible assets 0.1 0.1 0.2
Non underlying operating costs 6.8 6.9 16.2
Share-based payment expense 0.5 0.2 0.6
Operating cash flows before movements in working capital 15.3 12.8 28.5
Increase in receivables (6.7) (4.4) (7.9)
Increase (decrease) in payables 1.0 (0.1) 4.2
(Decrease) in provisions - (0.1) (0.3)
Cash generated by operations 9.6 8.2 24.5
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