REG - Christie Group PLC - Interim Results
30/09/2024 07:00
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RNS Number : 1033G Christie Group PLC 30 September 2024
30 September 2024
Christie Group plc
Interim Results for the six months ended 30 June 2024
Christie Group plc ('Christie Group' or the 'Group'), the leading provider of
Professional & Financial Services (PFS) and Stock & Inventory Systems
& Services (SISS) to the hospitality, leisure, healthcare, medical,
childcare & education and retail sectors, today announces its Interim
Results for the six months ended 30 June 2024
H1 2024 Financial Headlines
· Revenues increased by £2.2m (7%) to £35.3m (2023: £33.1m)
· £0.8m improvement in H1 operating loss to £0.6m (2023: £1.4m
loss)
· Recovery in PFS revenues which increased by 10% to £22.3m (2023:
£20.4m)
· PFS division returns to modest H1 operating profit (2023: £0.4m
loss)
· SISS revenues up 2% to £13.0m (2023: £12.8m)
· SISS operating loss significantly reduced by 38% to £0.6m loss
(2023: £1.0m loss)
· Both defined benefit pension schemes remain in surplus with no
ongoing cash cost
· Cash used in operations during the period was £1.1m (H1 2023:
£1.8m). The Group continues to operate within its banking facilities with net
overdraft facilities of £4.5m and an expectation of an improved cash position
by the year end
· The Board has maintained an interim dividend of 0.50p (H1 2023:
0.50p per share) reflecting its confidence in a stronger H2 and a profitable
full year performance
H1 2024 Operational Headlines
· Strong recovery in transactional brokerage activity in the UK,
with 517 units sold in H1 (2023: 376)
· UK performance offset by weak H1 trading in our international
businesses, where transaction timings are significantly second-half weighted
· 38% growth in H1 incomes from our finance brokerage activities
· 16% growth in H1 revenues from our UK hospitality stock audit
business
· Progress has been made in reducing losses in our retail
stocktaking operations, delivering a profitable H1 performance from our
aggregated UK operations
· Customer acquisition in our visitor attraction software business
has been disappointing
Current trading and outlook
· Transactional brokerage pipelines in the UK and Europe support
expectations of a stronger second half performance, and the Group is on-track
to deliver a recovery in FY24 transactional volumes to levels consistent with
those achieved in 2021 and 2022
· UK transactional pipelines were 24% higher at the end of H1 2024
than the same point in the previous year
· Finance brokerage activity is also encouraging with positive
levels of commercial mortgage and unsecured lending into our sectors
· Demand for our hospitality stock audit services remains robust
with encouraging levels of new business growth and sales conversion into our
pub and hotel markets
Financial results for the six months ended 30 June 2024
6 months ended 6 months ended 12 months ended
30 June 2024 (unaudited) 30 June 2023 (unaudited) 31 December 2023 (audited)
Revenue £35.3m £33.1m £65.9m
Operating loss pre non-recurring board changes and restructuring costs (£0.6m) (£1.4m) (£0.6m)
Loss before tax (£1.1m) (£1.9m) (£4.3m)
Basic EPS (3.51p) (5.41p) (14.79p)
Dividend Interim 0.50p Interim 0.50p Full year 1.00p
Dan Prickett, Chief Executive, commented:
"Reporting a first-half operating loss is undoubtedly a disappointing outcome
but masks progress being made across our Group. We have delivered a strong
recovery in our UK transactional brokerage activity in H1 alongside positive
growth performances in our finance brokerage business and our hospitality
stock audit business.
Within our PFS division, we have absorbed the significant costs of investing
in our international brokerage operations against second-half weighted income
expectations, while also bearing the costs of our ongoing development of a
resilient insurance brokerage business.
Within our SISS division, the Board is focused on eliminating losses from our
retail stocktaking and visitor attraction software brands.
We anticipate a much stronger H2 result and a return to a profitable full year
performance."
Enquiries:
Christie Group plc
Daniel Prickett 07885 813101
Chief Executive
Simon Hawkins 07767 354366
Chief Finance Officer
Shore Capital
Patrick Castle 020 7408 4090
Nominated Adviser & Broker
Notes to Editors:
Christie Group plc (CTG.L), quoted on AIM, is a leading professional business
services group with 37 offices across the UK and Europe, catering to its
specialist markets in the hospitality, leisure, healthcare, medical, childcare
& education and retail sectors.
Christie Group operates in two complementary business divisions:
Professional & Financial Services (PFS) and Stock & Inventory Systems
& Services (SISS). These divisions trade under the brand names: PFS
- Christie & Co, Pinders, Christie Finance and Christie Insurance: SISS
- Orridge, Venners and Vennersys.
Tracing its origins back to 1846, the Group has a long-established reputation
for offering valued services to client companies in agency, valuation
services, investment, consultancy, project management, multi-functional
trading systems and online ticketing services, stock audit and inventory
management. The diversity of these services provides a natural balance to the
Group's core agency business.
The information contained within this announcement is deemed by the Company to
constitute inside information for the purposes of Article 7 of the UK Market
Abuse Regulation (EU) No. 596/2014 which is part of the UK law by virtue of
the European Union (Withdrawal) Act 2018.
For more information, please go to https://www.christiegroup.com
(https://url.avanan.click/v2/___https:/www.christiegroup.com___.YXAxZTpzaG9yZWNhcDphOm86MzM0ZWUxOTJmMTc2NGRiMjRiZmM4YzZiY2U1M2ZlYzM6NjpjNjg3Ojc4M2RhNGZlOTJlZWE0MjljMmU1NGE3MzY4ZjRiOGVkMjQ4NGIzYWI5ZTVhMThmMzVhNzJhODYyZGQwY2I5OGM6cDpUOk4)
Chief Executive's review
As reported in our most recent trading update, the Group reported an operating
loss in the first half but has made progress in a number of areas which have
contributed to a reduction in the operating loss reported for the same period
last year. While ongoing market volatility has reduced the Board's original
expectations for the full year, we continue to anticipate a return to a
profitable full-year performance.
Financial Review
The Group reported revenues of £35.3m (2023: £33.1m) and an operating loss
of £0.6m (2023: operating loss £1.4m). The £0.8m reduction in H1 operating
losses was attributable to improvements in performance across both the
Professional and Financial Services ("PFS") division and the Stock &
Inventory Systems and Services ("SISS") division, with the H1 performance in
each improved by £0.4m year-on-year.
H1 revenue growth of 7% was primarily due to a recovery in transactional and
finance brokerage income in the PFS division, where income rose by 10% to
£22.3m (2023: £20.3m). In our SISS division, we grew revenues by a more
modest 2% to £13.0m (2023: £12.8m).
Employee benefit expenses increased by 5% to £26.3m (2023: £25.2m). Having
borne the impact of strong inflationary pay pressures and grown headcount in
those areas where we see the opportunity to support increased income
potential, lower inflationary pressures in 2024 and beyond will be welcome.
Other operating expenses increased by only 2% from £9.4m to £9.5m.
Finance costs increased slightly to £0.6m (2023: £0.5m). We anticipate our
cash balance improving in H2 as a result of the improved H2 trading outlook,
and with reduced working capital funding requirements where H1 outflows
include the payment of annual bonuses and commissions relating to the previous
year. Both of our defined benefit pension schemes remain in surplus.
Notwithstanding the disappointment of reporting a first half operating loss,
the Board's confidence of delivering a return to profit for the full year is
recognised by its decision to declare an interim dividend of 0.5p per share
(H1 2023: 0.5p per share) which will be paid on 8 November 2024 to
shareholders on the register on 11 October 2024.
Professional and Financial Services Division
A 38% increase in the number of businesses sold in the UK in the period - 517
compared to 376 in H1 2023 - was a key driver in the division's revenue
growth, but the strength of recovery in our UK agency business was offset by
weak first-half revenues from our European agency and advisory offices. The
strong volume recovery in our UK transactional income was counterbalanced by
the mix of revenues being derived from lower-value sector streams. Our average
fee per transaction reduced by 23% compared to 2023, but the composition of
our pipelines for second-half activity - we have a higher H2 weighting towards
sectors such as Healthcare, Childcare and Dental - mean that we expect to
sustain at least the same level of transaction volumes in H2, but with average
fees closer to H1 2023 levels.
Against this recovery in UK activity, we have borne the costs in the first
half of seeking to create a stronger, broader and more resilient European
network. With income for the year on the continent expected to be strongly
second half-weighted, the impact on H1 operating profits in the division has
been stark and has prevented the division from achieving the double-digit
operating profit return on revenue that it would otherwise be capable of. The
mainland continental performance in the period has served to offset otherwise
encouraging performances from our UK agency teams and our finance brokerage
operation. The latter saw H1 revenues grow by 38% compared to the prior year
with revenues from our commercial mortgage, unsecured and real estate and
bridging finance streams all contributing to that strong growth.
Our advisory teams have once again been busy throughout the period. We valued
over £5.7bn of businesses during the period. This was a slight reduction on
the £6.1bn we valued in H1 2023 as the first half ended with a short period
of subdued activity in the run up to the UK General Election which took place
on 4(th) July.
We also continued to invest in developing our insurance brokerage business and
have seen encouraging progress being made in the level of client retentions
now being achieved, and an encouraging level of life and protection cover
being secured, often for clients for which we have already secured commercial
mortgage lending offers through our finance brokerage teams.
Stock & Inventory Systems & Services Division
In the SISS division, 16% income growth from our hospitality stock audit
business was offset by lower revenues from our retail stocktaking operation
and slower growth than desired from our visitor attraction software business.
We nonetheless managed to deliver a £0.4m reduction in first-half operating
losses to £0.6m (2023: operating loss £1.0m). This was achieved by operating
our retail stocktaking operation from a more efficient base following the
actions taken in H2 2023 and benefitting from strong profit conversion of the
income growth in our hospitality stock audit business. The main disappointment
in our SISS operating performance in the first half was a weak level of new
business wins achieved in our visitor attraction software business, where
client buying decisions appear linked to increasingly elongated funding
applications for government and local authority grants.
Outlook
The Group commenced the second half with encouraging pipelines for both the UK
and our European businesses, with the UK transactional pipeline 24% higher
than the same point than H1 2023. As a result, we are optimistic of stronger
second half trading performance and anticipate returning to brokering the sale
or purchase of over 1,000 businesses in the year. The outlook for our finance
brokerage business in the second half is similarly positive.
In our SISS division we expect continued growth from our hospitality stock
audit business, and further progress in the steps needed to reduce or
eliminate losses from our retail stocktaking operation. Following the
disappointing sales performance of our visitor attraction business in H1, we
have already secured a number of wins in the early part of H2, but growth rate
remains subdued.
I would like to thank our talented and dedicated teams who have worked with
such commitment throughout the first half and their continued dedication
during the remainder of this year to deliver positive outcomes for our
clients. We look forward to a positive outcome for the full year.
Dan Prickett
Chief Executive Officer
Independent Review Report to Christie Group plc
Introduction
We have been engaged by the company to review the condensed set of financial
statements in the half-yearly financial report for the six-month period ended
30 June 2024 which comprises the Interim Consolidated Income Statement, the
Interim Consolidated Statement of Comprehensive Income, the Interim
Consolidated Statement of Financial Position, the Interim Consolidated
Statement of Cash Flows, the Interim Consolidated Statement of Changes in
Equity and the related Notes 1 to 16.
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2024 is not prepared, in all
material respects, in accordance with International Accounting Standard
('IAS') 34 "Interim Financial Reporting", as adopted for use in the United
Kingdom and the AIM Rules issued by the London Stock Exchange.
Basis for Conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, "Review of Interim Financial Information Performed by
the Independent Auditor of the Entity" issued for use in the United Kingdom. A
review of interim financial information consists of making enquiries,
primarily of persons responsible for financial and accounting matters, and
applying analytical and other review procedures. A review is substantially
less in scope than an audit conducted in accordance with International
Standards on Auditing (UK) and consequently does not enable us to obtain
assurance that we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit opinion.
As disclosed in Note 2, the annual financial statements of the group are
prepared in accordance with International Financial Reporting Standards
adopted for use in the United Kingdom ("UK adopted IFRS"). The condensed set
of financial statements included in this half-yearly financial report has been
prepared in accordance with International Accounting Standard ('IAS') 34
"Interim Financial Reporting", as adopted for use in the United Kingdom.
Conclusions Relating to Going Concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis of Conclusion section of this report,
nothing has come to our attention to suggest that management have
inappropriately adopted the going concern basis of accounting or that
management have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with
this ISRE, however future events or conditions may cause the entity to cease
to continue as a going concern.
Responsibilities of directors
The directors are responsible for preparing the half-yearly financial report
in accordance with International Accounting Standard ('IAS') 34 "Interim
Financial Reporting", as adopted for use in the United Kingdom and the AIM
Rules issued by the London Stock Exchange.
In preparing the half-yearly financial report, the directors are responsible
for assessing the Group's ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the
company or to cease operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the review of the financial information
In reviewing the half-yearly report, we are responsible for expressing to the
Company a conclusion on the condensed set of financial statement in the
half-yearly financial report. Our conclusion, including our conclusions
relating to going concern, are based on procedures that are less extensive
than audit procedures, as described in the Basis for Conclusion paragraph of
this report.
This report is made solely to the Company in accordance with guidance
contained in ISRE (UK) 2410 "Review of Interim Financial Information Performed
by the Independent Auditor of the Entity" issued by the Auditing Practices
Board. Our review work has been undertaken so that we might state to the
company those matters we are required to state to them in a review report and
for no other purposes. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than the Company, for our
work, for this report, or for the conclusions we have formed.
MHA, Statutory Auditor
Milton Keynes, United Kingdom
27 September 2024
MHA is the trading name of MacIntyre Hudson LLP, a limited liability
partnership in England and Wales (registered number OC312313)
Consolidated interim income statement
Note Half year to 30 June Half year to 30 June Year ended 31 December 2023
2024 2023 £'000
£'000 £'000 (Audited)
(Unaudited) (Unaudited)
Revenue 4 35,291 33,124 65,873
Employee benefit expenses (26,343) (25,159) (47,769)
8,948 7,965 18,104
Other operating expenses (9,530) (9,363) (18,736)
Operating loss pre non-recurring board changes and restructuring costs (582) (1,398) (632)
Non-recurring board changes and restructuring costs - - (2,723)
Operating loss post non-recurring board changes and restructuring costs (582) (1,398) (3,355)
Finance costs (565) (527) (1,043)
Finance income 2 62 115
Total finance costs (563) (465) (928)
Loss before tax (1,145) (1,863) (4,283)
Taxation 5 239 470 484
Loss for the period after tax (906) (1,393) (3,799)
Earnings per share attributable to equity holders - pence
Basic 6 (3.51) (5.41) (14.79)
Diluted 6 (3.51) (5.41) (14.79)
Loss for the period after tax is wholly attributable to equity shareholders of
the parent.
All amounts derive from continuing operations.
Consolidated interim statement of comprehensive income
Half year to 30 June Half year to 30 June Year ended 31 December 2023
2024 2023 £'000
£'000 £'000 (Audited)
(Unaudited) (Unaudited)
Loss for the period after tax (906) (1,393) (3,799)
Other comprehensive losses:
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translating foreign operations (8) (11) (42)
Net other comprehensive losses to be reclassified to profit or loss in (8) (11) (42)
subsequent periods
Items that will not be reclassified to profit or loss:
Re-measurement gains on defined benefit plans - 5,340 2,892
Effect of asset ceiling - (5,332) (2,882)
- 8 10
Tax effect on defined benefit plans - (2) (723)
Tax effect of asset ceiling - - 721
- (2) (2)
Net other comprehensive income not being reclassified to profit or loss in - 6 8
subsequent periods
Other comprehensive income/(losses) for the period net of tax - 6 (34)
Total comprehensive losses for the period (914) (1,398) (3,833)
Total comprehensive losses for the period are wholly attributable to equity
shareholders of the parent.
Consolidated interim statement of changes in shareholders' equity
Share capital Other reserves £'000 Cumulative Retained earnings Total equity
£'000 translation £'000 £'000
reserve
£'000
Half year to 30 June 2024 (unaudited)
Balance at 1 January 2024 531 3,679 525 (1,434) 3,301
Loss for the period after tax - - - (906) (906)
Other comprehensive losses - - (8) - (8)
Total comprehensive losses for the period - - (8) (906) (914)
Movement in respect of employee share scheme - 82 - - 82
Employee share option scheme:
- value of services provided - 31 - - 31
Dividends payable - - - (128) (128)
Transactions with shareholders - 113 - (128) (15)
Balance at 30 June 2024 531 3,792 517 (2,468) 2,372
Half year to 30 June 2023 (unaudited)
Balance at 1 January 2023 531 5,128 567 2,170 8,396
Loss for the period after tax - - - (1,393) (1,393)
Other comprehensive (losses)/income - - (11) 6 (5)
Total comprehensive losses for the period - - (11) (1,387) (1,398)
Movement in respect of employee share scheme - (506) - - (506)
Employee share option scheme:
- value of services provided - 34 - - 34
Dividends payable - - - (663) (663)
Transfer from share option reserve - (896) - 896 -
Transactions with shareholders - (1,368) - 233 (1,135)
Balance at 30 June 2023 531 3,760 556 1,016 5,863
Year ended 31 December 2023 (audited)
Balance at 1 January 2023 531 5,128 567 2,170 8,396
Loss for the year after tax - - - (3,799) (3,799)
Other comprehensive (losses)/income - - (42) 8 (34)
Total comprehensive losses for the year - - (42) (3,791) (3,833)
Movement in respect of employee share scheme - (571) - - (571)
Employee share option scheme:
- value of services provided - 76 - - 76
Dividends paid - - - (767) (767)
Transfer from share option reserve - (954) - 954 -
Transactions with shareholders - (1,449) - 187 (1,262)
Balance at 31 December 2023 531 3,679 525 (1,434) 3,301
Consolidated interim statement of financial position
At 31 December 2023
At 30 June 2024 At 30 June 2023 £'000
£'000 £'000 (Audited)
(Unaudited) (Unaudited)
Note
Assets
Non-current assets
Intangible assets - Goodwill 1,807 1,819 1,826
Intangible assets - Other 1,408 1,138 1,249
Property, plant and equipment 940 1,167 1,013
Right of use assets 6,046 6,049 6,294
Deferred tax assets 2,390 2,024 2,102
Other receivables 2,984 2,811 2,984
15,575 15,008 15,468
Current assets
Inventories 16 28 17
Trade and other receivables 8 11,837 10,519 9,442
Other current assets 2,056 2,299 3,186
Current tax assets - 399 -
Cash and cash equivalents 13 705 3,646 1,336
14,614 16,891 13,981
Total assets 30,189 31,899 29,449
Equity
Capital and reserves attributable to the Company's equity holders
Share capital 9 531 531 531
Other reserves 3,792 3,760 3,679
Cumulative translation reserve 517 556 525
Retained earnings (2,468) 1,016 (1,434)
Total equity 2,372 5,863 3,301
Liabilities
Non-current liabilities
Trade and other payables 385 620 814
Retirement benefit obligations 10 852 915 883
Lease liabilities 7,978 8,295 8,322
Provisions 1,243 1,410 1,243
10,458 11,240 11,262
Current liabilities
Trade and other payables 11 9,845 10,271 9,834
Lease liabilities 1,399 1,313 1,296
Current tax liabilities 29 359 72
Borrowings 3,094 1,707 721
Provisions 2,992 1,146 2,963
17,359 14,796 14,886
Total liabilities 27,817 26,036 26,148
Total equity and liabilities 30,189 31,899 29,449
Consolidated interim statement of cash flows
Note Half year to 30 June Half year to 30 June Year ended 31 December 2023
2024 2023 £'000
£'000 (Unaudited) £'000 (Audited)
(Unaudited)
Cash flow from operating activities
Cash used in operations 12 (1,129) (2,769) (1,809)
Interest paid (565) (528) (1,043)
Tax paid (50) (664) (612)
Net cash used in operating activities (1,744) (3,961) (3,464)
Cash flow from investing activities
Purchase of property, plant and equipment (214) (251) (368)
Interest received 2 62 115
Intangible asset expenditure (405) (233) (544)
Net cash used in investing activities (617) (422) (797)
Cash flow from financing activities
Repayment of bank borrowings - (1,000) (1,000)
Proceeds from invoice discounting 809 316 10
Repayment of lease liabilities (645) (898) (1,565)
Dividends paid - - (767)
Net cash generated/(used in) from financing activities 164 (1,582) (3,322)
Net decrease in cash (2,197) (5,965) (7,583)
Cash and cash equivalents at beginning of period 1,248 8,839 8,839
Exchange gains/(losses) on euro bank accounts 2 4 (8)
Cash and cash equivalents at end of period 13 (947) 2,878 1,248
Notes to the consolidated interim financial statements
1. General information
Christie Group plc is a public limited company incorporated in and operating
from England. The Company's ordinary shares are traded on the AIM Market
operated by the London Stock Exchange. Christie Group plc is the parent
undertaking of a group of companies covering a range of related activities.
These fall into two divisions - Professional & Financial Services and
Stock & Inventory Systems & Services. Professional & Financial
Services principally covers business valuation, consultancy & agency,
business mortgages & insurance services and business appraisal. Stock
& Inventory Systems & Services covers stock audit & counting,
consulting, compliance, inventory preparation & valuation and hospitality
& software solutions.
2. Basis of preparation
The interim financial statements have been prepared in accordance with
International Accounting Standard ('IAS') 34 "Interim Financial Reporting", as
adopted for use in the United Kingdom and the accounting policies applied in
the financial statements for the year ended 31 December 2023. Taxes on income
in the interim periods are accrued using the effective tax rate that would be
applicable to expected total annual earnings.
There are no new standards, amendments or interpretations that have been
published and are mandatory from 1 January 2024 that have a material effect on
the 31 December 2024 accounts.
Going concern
Having reviewed the Group and Company's detailed budgets, projections and
funding requirements to 31 December 2025, taking account of reasonable
possible changes in trading performance over this period, the Directors
believe they have reasonable grounds for stating that the Group and Company
have adequate resources to continue in operational existence for the
foreseeable future. Accordingly, the Directors continue to adopt the going
concern basis in preparing these interim accounts.
Non-statutory accounts
These consolidated interim financial statements have been prepared in
accordance with IAS 34 'Interim Financial Reporting'. The statutory accounts
for the year ended 31 December 2023 have been delivered to the Registrar of
Companies. The auditors reported on these accounts reported the following:
(1) their report was unqualified;
(2) did not contain a statement under either section 498(2) or section
498(3) of the Companies Act 2006; and
(3) did not include references to any matters to which the auditor drew
attention by way of emphasis.
The financial information for the periods ended 30 June 2024 and 30 June 2023
is unaudited.
3. Critical accounting estimates and judgements
Estimates and judgements are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances.
Critical accounting estimates and assumptions
The Group makes estimates and assumptions concerning the future. The resulting
accounting estimates will by definition, seldom equal the related actual
results. The estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below.
(a) Estimated impairment of goodwill and investments
Goodwill and investments are subject to an impairment review both annually and
when there are indications that the carrying value may not be recoverable. The
recoverable amounts of cash-generating units have been determined based on
value-in-use calculations.
(b) Retirement benefit obligations
The assumptions used to measure the expense and liabilities related to the
Group's defined benefit pension plans are reviewed annually by professionally
qualified, independent actuaries, trustees and management as appropriate.
Management base their assumptions on their understanding and interpretation of
applicable scheme rules which prevail at the statement of financial position
date. The measurement of the expense for a period requires judgement with
respect to the following matters, amongst others:
- the probable long-term rate of increase in pensionable pay;
- the discount rate; and
- the estimated life expectancy of participating members.
The assumptions used by the Group, may differ materially from actual results,
and these differences may result in a significant impact on the amount of
pension expense recorded in future periods. In accordance with IAS 19, the
Group recognises all actuarial gains and losses immediately in other
comprehensive income.
Where the present value of the minimum funding contributions exceeds the
present value of the defined benefit obligation and the amounts are not
available as a refund or reduction in future payments, the Company will adjust
the retirement benefit obligation to match the present value of the minimum
funding contributions. The liability recognised in the Statement of Financial
Position, will reflect the present value of the minimum funding contributions.
A corresponding charge will be recognised in other comprehensive income, as
'effect of asset ceiling' in the period which they arise.
Critical accounting judgements and assumptions
The critical judgements made in the process of applying the Group's accounting
policies during the year that have the most significant effect on the amounts
recognised in the financial statements are set out below.
(a) Deferred taxation
Deferred tax assets are recognised to the extent that the Group believes it is
probable that future taxable profit will be available against which temporary
timing differences and losses from previous periods can be utilised.
Management judgement is required to determine the amount of deferred tax
assets that can be recognised, based upon the likely timing and the level of
future taxable profits together with future tax planning strategies.
(b) Revenue recognition
In determining the amount to be recognised on incomplete contracts it is
necessary to estimate the stage of completion. An element of judgement and
estimate is inherent in this process.
3. Critical accounting estimates and judgements (continued)
(c) Property, plant and equipment
Depreciation is derived using estimates of assets' expected useful lives and
residual value, which are reviewed annually. Management determines useful
lives and residual values based on experience with similar assets.
(d) Leases - estimating the incremental borrowing rate
The Group cannot readily determine the interest rate implicit in the lease.
Therefore, it uses its incremental borrowing rate (IBR) to measure lease
liabilities. The IBR therefore reflects what the Group 'would have to pay',
which requires an estimate when no observable rates are available.
4. Segment information
The Group is organised into two main business segments: Professional &
Financial Services (PFS) and Stock & Inventory Systems & Services
(SISS).
The segment results for the period ended 30 June 2024 are as follows:
PFS SISS Other Group
£'000 £'000 £'000 £'000
Total gross segment revenue 22,345 13,006 - 35,351
Inter-segment revenue (60) - - (60)
Revenue 22,285 13,006 - 35,291
Operating profit/(loss) 37 (619) - (582)
Finance costs (398) (173) 8 (563)
Loss before tax (361) (792) 8 (1,145)
Taxation 239
Loss for the period after tax (906)
The segment results for the period ended 30 June 2023 are as follows:
PFS SISS Other Group
£'000 £'000 £'000 £'000
Total gross segment revenue 20,393 12,789 - 33,182
Inter-segment revenue (58) - - (58)
Revenue 20,335 12,789 - 33,124
Operating loss (384) (1,014) - (1,398)
Finance costs (178) (101) (186) (465)
Loss before tax (562) (1,115) (186) (1,863)
Taxation 470
Loss for the period after tax (1,393)
4. Segment information (continued)
The segment results for the year ended 31 December 2023 are as follows:
PFS SISS Other Group
£'000 £'000 £'000 £'000
Total gross segment revenue 42,351 23,638 - 65,989
Inter-segment revenue (116) - - (116)
Revenue 42,235 23,638 - 65,873
Operating profit/(loss) pre non-recurring board changes and restructuring 1,345 (1,977) - (632)
costs
Non-recurring board changes and restructuring costs (314) (262) (2,147) (2,723)
Operating profit/(loss) post non-recurring board changes and restructuring 1,031 (2,239) (2,147) (3,355)
costs
Finance costs (530) (252) (146) (928)
Profit/(loss) before tax 501 (2,491) (2,293) (4,283)
Taxation 484
Loss for the year after tax (3,799)
Revenue recognised in the period has been derived from the provision of
services provided when the performance obligation has been satisfied.
5. Taxation
Deferred tax assets have been recognised in respect of tax losses and other
temporary differences giving rise to deferred tax assets where it is probable
that these assets will be recovered.
6. Earnings per share
Basic earnings per share is calculated by dividing the profit/(loss)
attributable to equity holders of the Company by the weighted average number
of ordinary shares in issue during the period, which excludes the shares held
in the Employee Share Ownership Plan (ESOP) trust.
Diluted earnings per share is calculated by adjusting the weighted average
number of ordinary shares outstanding to assume conversion of all dilutive
potential ordinary shares, once performance conditions are met. The Company
has only one category of potential dilutive ordinary shares: share options.
The calculation is performed for the share options to determine the number of
shares that could have been issued at fair value (determined as the average
annual market share price of the Company's shares) based on the monetary value
of the subscription rights attached to outstanding share options. The number
of shares calculated as above is compared with the number of shares that would
have been issued assuming the exercise of the share options.
Half year to Half year to Year ended 31 December 2023
30 June 2024 30 June 2023 £'000
£'000 £'000
Loss attributable to the equity holders (906) (1,393) (3,799)
30 June 2024 30 June 2023
6. Earnings per share (continued)
Thousands Thousands 31 December 2023
Thousands
Weighted average number of ordinary shares in issue 25,793 25,725 25,694
Adjustment for share options (158) 373 235
Weighted average number of ordinary shares for diluted earnings per share 25,635 26,098 25,929
30 June 2024 30 June 2023
Pence pence 31 December 2023
Pence
Basic earnings per share (3.51) (5.41) (14.79)
Diluted earnings per share (3.51) (5.41) (14.79)
7. Dividends
A final dividend in respect of 2023 of 0.50p per share, amounting to a
dividend of £128,000, was proposed by the directors and approved by the
shareholders at the Annual General Meeting on 13 June 2024, with the funds
paid to the registrar on 2 July 2024. The funds were transferred to
shareholders on 12 July 2024.
An interim dividend in respect of 2024 of 0.50p per share, amounting to a
dividend of £133,000, was declared by the directors at their meeting on 24
September 2024. These financial statements do not reflect this dividend
payable.
The dividend of 0.50p per share will be payable to shareholders on the record
on 11 October 2024. The dividend will be paid on 8 November 2024.
As at the 30 June 2024, the parent company had distributable reserves of
£12,780,000 (31 December 2023: £10,616,000).
8. Trade and other receivables
Half year to Half year to Year ended
30 June 2024 30 June 2023 31 December 2023
£'000 £'000 £'000
Trade receivables 8,921 8,111 6,512
Less: provision for impairment of receivables (747) (733) (693)
Contract assets 2,586 2,031 2,536
Other debtors 1,077 1,110 1,087
11,837 10,519 9,442
The fair value of trade and other receivables approximates to the carrying
value as detailed above.
9. Share capital
30 June 2024 30 June 2023 31 December 2023
Ordinary shares of 2p each Number £'000 Number £'000 Number £'000
Allotted and fully paid:
At beginning and end of period 26,526,729 531 26,526,729 531 26,526,729 531
The Company has one class of ordinary shares which carry no right to fixed
income.
Investment in own shares
The Group has established an Employee Share Ownership Plan (ESOP) trust to
meet its future contingent obligations under the Group's share option
schemes. The ESOP purchases shares in the market for distribution at a later
date in accordance with the terms of the Group's share option schemes. The
rights to dividend on the shares held have been waived.
10. Retirement benefit obligations
The Group operates two defined benefit schemes (closed to new members)
providing pensions on final pensionable pay. The contributions are determined
by qualified actuaries based on triennial valuations using the projected unit
method.
When a member retires, the pension and any spouse's pension is either secured
by an annuity contract or paid from the managed fund. Assets of the schemes
are reduced by the purchase price of any annuity purchase and the benefits no
longer regarded as liabilities of the scheme.
The defined benefit is calculated on a year-to-date basis. There have been no
significant market fluctuations and significant one-off events, such as plan
amendments, curtailments and settlements that have resulted in an adjustment
to the actuarially determined pension cost since the end of the prior
financial year. The terms of the schemes are that the Group does not have an
unconditional right to a refund of any surplus. Therefore there is an asset
ceiling that prevents an asset being recognised. The asset ceiling at 31
December 2023 was £16.8m unrecognised asset (30 June 2023: £20.0m). Given
that the pension schemes remain in surplus and the asset would not be
recognised, accordingly no formal actuarial valuation of the pension schemes
has been undertaken as at 30 June 2024.
The obligation outstanding of £852,000 (30 June 2023: £915,000; 31 December
2023: £833,000) represents £852,000 (30 June 2023: £915,000; 31 December
2023: £883,000) payable to David Rugg by Christie Group plc. The movement in
the pension liability attributable to David Rugg's pension arises from a
change in the actuarial assumptions used and the discount rate applied. There
have been no changes to the amounts payable to Mr Rugg.
The Group continues to work closely with the Trustee in managing pension
risks, with the defined benefit schemes closed to new members since 1999 &
2000.
In addition, the Group operates a defined contribution scheme for
participating employees. Payments to the scheme are charged as an employee
benefit as they fall due. The Group has no further payment obligations once
the contributions have been paid.
11. Trade and other payables
Half year to Half year to Year ended
30 June 2024 30 June 2023 31 December 2023
£'000 £'000 £'000
Trade payables 1,281 1,126 2,080
Other taxes and social security 2,929 2,594 2,438
Other creditors 757 1,357 606
Contract liabilities 366 281 277
Accruals 4,512 4,913 4,433
9,845 10,271 9,834
12. Note to the cash flow statement
Cash generated from operations
Half year to Half year to Year ended
30 June 2024 30 June 2023 31 December 2023
£'000 £'000 £'000
Continuing operations
Loss for the period (906) (1,393) (3,799)
Adjustments for:
- Taxation (239) (470) (484)
- Finance costs 563 465 928
- Depreciation 870 758 1,591
- Amortisation of intangible assets 204 195 399
- Profit on sale of PP&E - - (64)
- Foreign currency translation 1 169 88
- Increase in provisions 29 42 1,692
- Payments to ESOT - (300) (375)
- Movement in share option charge 31 34 76
- Movement in non-current other receivable - - (173)
Movement in working capital:
- (Increase)/decrease in inventories (1) (3) 8
- Increase in trade & other receivables (1,265) (381) (191)
- Decrease in trade & other payables (418) (1,885) (1,505)
Cash used in operations (1,129) (2,769) (1,809)
13. Cash and cash equivalents
Half year to Half year to Year ended
30 June 2024 30 June 2023 31 December 2023
£'000 £'000 £'000
Cash and cash equivalents 705 3,646 1,336
Bank overdrafts (1,652) (768) (88)
(947) 2,878 1,248
The Group is operating within its existing banking facilities and maintains a
net overdraft facility of £4.5m.
14. Related-party transactions
There is no controlling interest in the Group's shares.
During the period rentals of £299,000 (30 June 2023: £282,000; 31 December
2023: £565,000) were payable to Carmelite Property Limited by Christie Group
plc in accordance with the terms of a long-term lease agreement. Carmelite
Property Limited is a company incorporated in England and Wales, and jointly
owned by The Christie Group Pension and Assurance Scheme, The Venners
Retirement Benefit Fund and The Fitzroy Square Pension Fund, by Christie Group
plc in accordance with the terms of a long-term lease agreement.
15. Publication of Interim Report
The 2024 Interim Financial Statements are available on the Company's website
https://www.christiegroup.com
(https://url.avanan.click/v2/___https:/www.christiegroup.com___.YXAxZTpzaG9yZWNhcDphOm86MzM0ZWUxOTJmMTc2NGRiMjRiZmM4YzZiY2U1M2ZlYzM6NjpjNjg3Ojc4M2RhNGZlOTJlZWE0MjljMmU1NGE3MzY4ZjRiOGVkMjQ4NGIzYWI5ZTVhMThmMzVhNzJhODYyZGQwY2I5OGM6cDpUOk4)
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