REG - DSW Capital PLC - Half Year Results
27/11/2023 07:00
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RNS Number : 6526U DSW Capital PLC 27 November 2023
27 November 2023
DSW CAPITAL PLC
("DSW Capital", "DSW" or the "Group")
(AIM:DSW)
Half Year Results
Resilient performance with M&A activity levels returning towards more
normal levels
DSW Capital, a profitable, mid-market, challenger professional services
licence network and owner of the Dow Schofield Watts brand, is pleased to
announce its half year results for the six-month period ended 30 September
2023 ("H1 24" or the "Period").
The Group delivered a resilient performance in H1 24, under challenging market
conditions which dominated trading in the first four months of the Period. The
Group's licensees reported a return towards more normalised levels of M&A
activity over the last two months of the Period, with activity levels
continuing to improve post Period end, suggesting that the low point in the
cycle may have passed.
Financial highlights
· Network Revenue 25.3% lower at £7.3m (H1 23: £9.8m), reflecting subdued
M&A activity
· Total income from licensees was 30.9% lower at £1.1m (H1 23: £1.6m)
· Adjusted Pre-Tax Profit reduced to £0.2m (H1 23: £0.9m), after increased
investment of £0.2m to capitalise on increasingly favourable recruitment
conditions
· Statutory Loss before tax of £0.1m (H1 23: £0.6m Profit)
· Cash of £2.8m (FY23: £4.6m), after the investment of £0.9m in Bridgewood,
dividend payment of £0.4m and breakout incentives of £0.2m to new partners
· Net cash used by operations of £0.3m, comprising start up loans and working
capital support provided to new licensees. Lock up remains low at 33 days
(FY23: 27 days), contributing to a strong balance sheet with Net Assets of
£7.6m (FY23: £7.9m)
· Interim dividend of 1.25p per share, representing one third of the intended
full year dividend (FY23: 3.76p). We intend to maintain our progressive
dividend policy.
Operational highlights
· Fee Earners increased to 104 at the Period end (H1 23: 93), up 11.8% YoY, with
Partner numbers increasing 20% from 40 to 48
· An additional Corporate Recovery licensee was added in July, with DSW
supporting the MBO of Bridgewood
· Tax advisory capabilities, a target for the Group, were expanded through
supporting DSW Tax Advisory's acquisition of STS Europe
· A new geographic location and office in Leicester was added during the Period
with a Corporate Finance team joining the Network under the Breakout
Initiative
· Since the Period end, a further geographic location has been added under the
Breakout Incentive, which targets existing teams in larger firms, with the
launch of a new Corporate Finance business in Cardiff
· Whilst deal volumes have decreased on the prior period (named by Experian* as
the 20(th) most active corporate finance adviser in the UK in the first half
of 2023, compared to 10(th) in the first half of 2022), average deal values
across Corporate Finance and Financial Due Diligence have increased from £8m
to £14m, reflecting the growing strength and profile of the brand
*Experian Market IQ: H1 2023 Report
Current trading and outlook
· Adjusted Pre-Tax Profit in FY24 expected to be between
£1.1m to £1.4m - higher end achievable subject to certain M&A deals
completing before the year end
· A further geographic location has been added under the Breakout Incentive,
which extracts existing teams from larger firms, with the launch of a new
Corporate Finance business in Cardiff in October 2023
· Three new partners have joined the business, since the Period end, taking the
current total to 51
· DSW Network well positioned to benefit from returning M&A activity levels,
which continue to recover
· Early results of recruitment investment are positive - the increase in
partners is expected to drive organic fee earner growth
· The Board is confident in the Group's growth strategy and continues to invest
in the long-term future of the Network
James Dow, Chief Executive Officer, said:
"We will continue to seek to grow the business, through diversification with
the addition and expansion of new service lines, to improve its resilience and
reduce its dependence on corporate finance and due diligence.
"During this favourable time for recruitment, our ongoing investment has
delivered three new offices to the Network and expanded our corporate recovery
and tax service lines, as well as increasing Partner numbers from 40 to 51.
Partner numbers are a lead indicator of future organic Fee Earner growth.
"We will continue to invest in the long-term profitable growth of the business
and the delivery of strong returns for all our stakeholders."
Definitions:
Adjusted Pre-Tax Profit - Adjusted operating profit, which is defined as
operating profit adjusted for items not considered part of underlying trading,
which in the current and prior period represents share-based payments, is a
non-GAAP metric used by management and is not an IFRS disclosure
Network Revenue - Network Revenue is defined as total revenue earned by
licensees, as opposed to total revenue reported by the Company
Total income from licensees - Total income from licensees represents statutory
revenue plus share of results in associates
Lock up - Defined as licence fee and profit share debtors as a proportion of
Network Revenue
Enquiries:
DSW Capital
James Dow, Chief Executive Officer Tel: +44 (0) 1928 378 029
Nicole Burstow, Deputy CEO Tel: +44 (0) 1928 378 039
Shore Capital (Nominated Adviser & Broker) Tel: +44 (0)20 7408 4090
James Thomas / Mark Percy / Rachel Goldstein
Guy Wiehahn / Isobel Jones (Corporate Broking)
Belvedere Communications
Cat Valentine Tel: +44 (0) 7715 769 078
Keeley Clarke Tel: +44 (0) 7967 816 525
dsw@belvederepr.com
(https://url.avanan.click/v2/___mailto:dswcapital@belvederepr.com___.YXAxZTpzaG9yZWNhcDphOm86Yjc0Nzc1ZDRhNmI2ZDQ3ODRiMTU2MDJlZmUzYWIyOWE6NjpiM2UzOjNlNDFhZjMzOTc3YTA5ZmIzMjJlN2ExNDJmOTg4MGVjYWZhNzZkYmI3ZGY2YTQxYzA1YWZlYWI2NjhhYmZjMTg6cDpU)
About DSW Capital
DSW Capital, owner of the Dow Schofield Watts brand, is a profitable,
mid-market, challenger professional services network with a cash generative
business model and scalable platform for growth. Originally established in
2002, by three KPMG alumni, DSW is one of the first platform models disrupting
the traditional model of accounting professional services firms. DSW now
operates licensing arrangements with 25 licensee businesses with 106 fee
earners, from 12 offices across the UK. These trade primarily under the Dow
Schofield Watts brand.
DSW's vision is for the DSW Network to become the most sought-after
destination for ambitious, entrepreneurial professionals to start and develop
their own businesses. Through a licensing model, DSW gives professionals the
autonomy and flexibility to fulfil their potential. Being part of the DSW
Network brings support benefits in recruitment, funding and infrastructure.
DSW's challenger model attracts experienced, senior professionals,
predominantly with a "Big 4" accounting firm background, who want to launch
their own businesses and recognise the value of the Dow Schofield Watts brand
and the synergies which come from being part of the DSW Network.
DSW aims to scale its agile model through organic growth, geographical
expansion, additional service lines and investing in "Break Outs" (existing
teams in larger firms). The Directors are targeting high margin,
complementary, niche service lines with a strong synergistic fit with the
existing DSW Network.
Chief Executive Officer's Statement
I am pleased to report that the Group continued to make progress on its
strategic growth plans, despite the challenging market conditions encountered
in the first four months of the Period, which impacted our overall trading
performance in H1 24.
I am encouraged that our licensees reported more normalised levels of M&A
activity in the three months to 31 October 2023, which suggests that we may
have passed the low point in the cycle. We expect that M&A activity will
continue to recover in the second half and that the Group is likely to achieve
Adjusted Pre-Tax Profit between £1.1m to £1.4m in FY24.
The Board would like to thank all our Licensee Partners and Employees for
their hard work and commitment to the DSW brand.
Network Revenue in the Period was £7.3m, compared to £9.8m in H1 23. This
resulted in a decrease in Total Income from Licensees in the Period to £1.1m
(H1 23: £1.6m) and a consequent reduction in Adjusted Pre-Tax Profit to
£0.2m (H1 23: £0.9m). The decline in profitability also reflects the
significant investment (£0.2m) made into recruitment in the Period, to enable
us to capitalise on the increasingly favourable recruitment conditions.
The Group's cash at the half year end was in line with management expectation
at £2.8m (FY23: £4.6m), reflecting the investment of £0.9m in Bridgewood,
the dividend payment of £0.4m and breakout incentives paid to new partners of
£0.2m.
We have continued to strengthen our central infrastructure and support
offering in the Period, with greater training and development opportunities
for partners and employees, the launch of our ESG Committee and improving our
IT capabilities to create greater working efficiencies for our teams.
Continually improving and enhancing our service offering increases the
attractiveness of the Network to new recruits, adds to the value we provide to
our existing licensees and enables us to retain them.
Vision and strategy
DSW Capital is the owner of the Dow Schofield Watts brand, which is the
predominant brand it licences to licensee businesses. Our vision is to become
the most sought-after destination for ambitious, entrepreneurial professionals
to start and develop their own businesses. We aim to scale the business
through organic growth, new service lines and geographic locations, and
investing in "Break Outs", which extracts existing teams from larger firms.
We further executed on our strategy in the Period. Fee Earners within our 25
licensed businesses rose to 104, compared with 93 at H1 23, as the Group
benefitted from the significant investment in its recruitment resources. We
have increased the number of Fee Earners in the Network by 22, or 26.8%, since
IPO in December 2021.
The growth in Fee Earners in H1 24 centred on partners, with a new office
being launched in Leicester, which was supported by our acquisitions of
licensee fee income. Organic recruitment was hampered, as the more demanding
trading conditions meant our partners were, understandably, less inclined to
recruit replacements for their leavers. Our attrition levels, however, remain
low at 12% for the last 12 months. Of our 104 Fee Earners at H1 24, 48 were
partners, compared to 40 in the prior year period. This 20% growth in partners
is a lead indicator for future organic Fee Earner growth and subsequent
organic recruitment.
The Group remains committed to the acquisition of licence fees and further
diversification, through the broadening of its service lines. We are in
constant dialogue to encourage teams to join DSW and successfully added
Bridgewood (Corporate Recovery) and STS Europe (Tax Advisory) in the Period.
We are confident that our efforts will continue to bear fruit.
People
After the Period end, on 11 October 2023, Nicole Burstow, our Chief Financial
Officer ("CFO") was appointed as Deputy Chief Executive Officer. We are
extremely fortunate to have such a capable and committed executive, she is
well respected by all our stakeholders, and this appointment reflects that her
contribution to the Group has extended far beyond her role for quite some
time. Nicole will continue to fulfil her responsibilities as CFO.
Dividend
We maintain a robust cash position with cash balances of £2.8 million and are
pleased to declare an interim dividend of 1.25p per share. The interim
dividend will be paid on 12 January 2024 to shareholders on the register on 15
December 2023 with the shares going ex-dividend on 14 December 2023.
The Board intends to maintain the total dividend payable for the year at 3.76p
(FY23: 3.76p). In line with the Group's stated dividend policy, one third will
be paid at the interim. The maintenance of the dividend at last year's level
demonstrates our confidence in the medium-term prospects of the Group and we
intend to maintain our progressive dividend policy.
Current trading and outlook
Our results are typically weighted towards the second half of the financial
year, due to the recognition of profit share income. This year is no
exception. The Group will benefit from the contribution from Bridgewood, which
joined the Network in July 2023, in the second half, and also from an
expected improvement in M&A activity. Whilst M&A activity levels are
improving, this market represents a sizeable percentage of Group revenues (H1
24: 73%, H1 23: 73%) and the timing of transactions can change. As such, the
Board expects to achieve an Adjusted Pre-Tax Profit in FY24 of
between £1.1m to £1.4m. The higher end of this range remains
achievable but is subject to the successful completion of certain M&A
deals currently scheduled to complete before the year end.
The Board was cautious at the start of the year and remains vigilant to macro
uncertainties. We are pleased with the strategic progress being made and
continue to seek opportunities to grow the business through licensee growth
and diversification, with the addition and expansion of new service lines, to
improve its resilience. Since the Period end, we have launched a new Corporate
Finance business, based in Cardiff, focused on Wales and the South-West, which
has added an additional two partners. A further Partner has also joined the
DSW Ventures team post Period end, taking our Partner numbers to 51.
With a strong cash balance (£2.8m) and a robust Balance Sheet (Net Assets of
£7.6m), we remain well-resourced to execute our strategy. The strategic
progress to date has laid the foundations for future growth and the Board is
confident in the medium-term outlook for the Group.
James Dow
Chief Executive Officer,
27 November 2023
Interim consolidated statement of comprehensive income
For the six month period ended 30 September 2023
6 months ended 30 Sept 2023 6 months ended 30 Sept 2022
Note £'000 £'000
Continuing operations
Revenue 5 1,108 1,509
Gross profit 1,108 1,509
Share of results of associates 20 124
Share of results of jointly controlled entity 45 -
Administrative expenses (1,331) (1,075)
Operating (loss) / profit (158) 558
Adjusted operating profit(1) 95 872
Share based payments expense (253) (314)
Operating (loss) / profit (158) 558
Finance income 109 43
Impairment of loans due from associated undertakings 2 -
Finance costs (16) (13)
(Loss) / Profit before tax (63) 588
Adjusted Profit before tax(2) 190 902
Share based payments expense (253) (314)
(Loss) / Profit before tax (63) 588
Income tax (40) (170)
(Loss) / Profit for the half-year (103) 418
Total comprehensive (expenditure) / income for the half-year attributable to (103) 418
owners of the Company
(Loss) / Earnings per share
From continuing operations
Basic 3 (£0.005) £0.020
Diluted 3 (£0.005) £0.020
(1) Adjusted operating profit, which is defined as operating profit adjusted
for items not considered part of underlying trading, which in the current and
prior period represents share based payments, is a non GAAP metric used by
management and is not an IFRS disclosure.
(2) Adjusted profit before tax, which is defined as profit before tax adjusted
for items not considered part of underlying trading, which in the current and
prior period represents share based payments, is a non GAAP metric used by
management and is not an IFRS disclosure.
Interim consolidated statement of financial position
For the six month period ended 30 September 2023
Note As at 30 Sept 2023 As at 31 March 2023
£'000 £'000
Non-current assets
Intangible assets 725 748
Property, plant and equipment 387 440
Investments 7 1,422 922
Investments in associates 7 132 209
Interests in jointly controlled entities 7 30 39
Prepayments and Accrued Income 8 631 166
Deferred Tax asset 9 9
3,336 2,533
Current assets
Trade receivables 8 1,077 924
Prepayments and Accrued Income 8 311 350
Other receivables 8 834 567
Cash and bank balances 2,817 4,584
5,039 6,425
Total assets 8,375 8,958
Current liabilities
Trade payables 86 162
Other taxation 146 211
Other payables 101 76
Accruals and Deferred Income 63 133
Current tax liabilities 16 95
Lease liability 93 91
505 768
Net current assets 4,534 5,657
Non-current liabilities
Lease liability 173 220
Dilapidation provision 77 75
250 295
Total liabilities 755 1,063
Net assets 7,620 7,895
Equity
Share capital 55 55
Share premium 5,268 5,271
Share-based payment reserve 2,121 1,868
Retained earnings 176 701
Total Equity attributable to owners of the Company 7,620 7,895
The interim statements were approved and authorised for issue by the Board of
Directors on 24 November 2023 and were signed on its behalf by James Dow,
Chief Executive Officer.
Interim consolidated statement of changes in equity
For the six month period ended 30 September 2023
Share capital Share premium Share-based payments reserve Retained earnings Total equity
£'000 £'000 £'000 £'000 £'000
Balance at 1 April 2022 54 5,280 1,174 1,477 7,985
Profit for the half-year - - - 418 418
Dividends - - - (890) (890)
Share-based payments - - 314 - 314
Issue of shares in period 1 - - - 1
Balance at 30 Sept 2022 55 5,280 1,488 1,005 7,828
Profit for the half-year - - - 67 67
Dividends - - - (371) (371)
Share-based payments - - 380 - 380
Issue of shares in period - (9) - - (9)
Balance at 1 April 2023 55 5,271 1,868 701 7,895
Loss for the half-year - - - (103) (103)
Dividends - - - (422) (422)
Share-based payments - - 253 - 253
Issue of shares in period - (3) - - (3)
Balance at 30 Sept 2023 55 5,268 2,121 176 7,620
Interim consolidated statement of cash flows
For the six month period ended 30 September 2023
6 months ended 30 Sept 2023 6 months ended 30 Sept 2022
Note £'000 £'000
(Loss) / Profit for the half-year (103) 418
Adjustments for:
Income tax expense 40 170
Net interest income (93) (30)
Depreciation of property, plant and equipment 70 69
Amortisation of intangible assets 24 23
Bonus shares / LTIP awards - 1
Impairment of loans due from associated undertakings (2) -
Share-based payment expense 253 314
Operating cash flows before movements in working capital 189 965
Increase in trade and other receivables (326) (171)
Decrease in trade and other payables (186) (68)
Decrease in amounts owed from associates and jointly controlled entities in 47 95
relation to profit share
Cash (used by) / generated by operations (276) 821
Income taxes paid (120) (63)
Net cash (outflow) / inflow from operating activities (396) 758
Investing activities
Purchases of property, plant and equipment (16) (14)
Investments made in period 7 (986) -
Net cash used in investing activities (1,002) (14)
Financing activities
Dividends paid 6 (422) (890)
Finance lease payments (53) (51)
Interest received 109 42
Costs of issue of ordinary shares (3) -
Net cash used in financing activities (369) (899)
Net decrease in cash and cash equivalents (1,767) (155)
Cash and cash equivalents at beginning of half-year 4,584 4,722
Cash and cash equivalents at end of half-year 2,817 4,567
Notes to the interim consolidated financial information
1. General Information
The Company was incorporated as DSW Capital Limited on 23 March 2010 under the
Companies Act 2006 (Registration number: 07200401). The Company was
re-registered as DSW Capital plc on 26 October 2021. The Company is
incorporated and domiciled in England and Wales. The principal activity of the
Company and its subsidiaries, DSW Services LLP and Dow Schofield Watts
Operations Limited (together referred to as the 'Group') is the licensing of
the Dow Schofield Watts brand and associated brand names for use in the
professional services sector.
The address of the Company's registered office is:
7400 Daresbury Park
Daresbury
Warrington
WA4 4BS
2. Basis of preparation
This condensed consolidated interim financial information for the 6 months to
30 September 2023 has been prepared in accordance with IAS 34 'Interim
financial reporting' and also in accordance with the measurement and
recognition principles of UK adopted international accounting standards. It
does not include all of the information required for full annual financial
statements and should be read in conjunction with the Annual Report and
Accounts for the year ended 31 March 2023. A copy of the statutory accounts
for that year has been delivered to the Registrar of Companies. The auditors
reported on those accounts: their report was unqualified, did not draw
attention to any matters by way of emphasis and did not contain a statement
under section 498 (2) or (3) of the Companies Act 2006. This condensed
consolidated interim financial information does not comprise statutory
accounts within the meaning of section 434 of the Companies Act 2006. The
Interim Report has not been audited or reviewed in accordance with the
International Standard on Review Engagement 2410 issued by the Auditing
Practices Board.
The interim condensed consolidated financial information is presented in the
Group's functional currency of Pounds Sterling and all values are rounded to
the nearest thousand (£'000) except when otherwise indicated.
Significant Accounting Policies
The accounting policies used in the preparation of the interim financial
information for the six months ended 30 September 2023 are in accordance with
the recognition and measurement criteria of UK Adopted International
Accounting Standards and are consistent with those which were adopted in the
annual statutory financial statements for the year ending 31 March 2023.
Use of estimates and judgements
There have been no material revisions to the nature of estimates and
judgements of amounts reported in prior periods.
Going concern
The interim financial information has been prepared on a going concern basis
as the Directors have reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable future. The
Group has no debt and £2.8m cash at 30 September 2023. The Group's forecasts
and projections show that the Group has sufficient resources for both current
and anticipated cash requirements.
Accounting Developments
There have been no new standards or interpretations, relevant to the Group's
operations, applied in the interim financial information.
Adjusted PBT
Adjusted PBT is utilised as a key performance indication for the Group and is
calculated as follows:
Six months ended Six months ended
30 September 2023 30 September 2022
£'000 £'000
(Loss) / Profit before tax (63) 588
Share based payments 253 314
Adjusted PBT 190 902
3. Earnings per share
From continuing operations
The calculation of the basic and diluted earnings per share is based on the
following data:
Six months ended 30 September 2023 Six months ended 30 September 2022
Earnings £'000 £'000
Earnings for the purposes of basic earnings per share being net profit (103) 418
attributable to owners of the Company
Effect of dilutive potential ordinary shares: - -
Earnings for the purposes of diluted earnings per share (103) 418
Six months ended 30 September 2023 Six months ended 30 September 2022
Number of shares
Weighted average number of ordinary shares for the purposes of basic earnings 21,086,175 21,065,045
per share
Effect of dilutive potential ordinary shares:
Share Options 840,185 509,629
Weighted average number of ordinary shares for the purposes of diluted 21,926,360 21,574,674
earnings per share
Six months ended 30 September 2023 Six months ended 30 September 2022
Earnings £ £
Basic (loss) / earnings per share (0.005) 0.020
Diluted earnings per share (0.005) 0.020
Adjusted earnings per share is included as an Alternative Performance Measure
('APM') and is not presented in accordance with IAS 33. It has been calculated
using adjusted earnings calculated as profit after tax but before:
· Share-based payments expense and
· The tax effect of the above item
The calculation of adjusted basic and adjusted diluted earnings per share is
based on:
Six months ended 30 September 2023 Six months ended 30 September 2022
£'000 £'000
(Loss) / Profit after tax on continuing operations (103) 418
Adjusted for:
Share-based payment expense 253 314
Tax effect of adjustments above - -
Adjusted earnings for the purposes of adjusted basic and adjusted diluted 150 732
earnings per share
Six months ended 30 September 2023 Six months ended 30 September 2022
Earnings £ £
Adjusted basic earnings per share 0.01 0.03
Adjusted diluted earnings per share 0.01 0.03
Shares held in trust are issued shares that are owned by the Group's employee
benefit trusts for future issue to employees as part of share incentive
schemes. The future exercise of the share awards and options is the dilutive
effect of share awards granted to employees that have not yet vested.
Shares held in trust are deducted from the weighted average number of shares
for basic earnings per share. For its adjusted basic measure, the Group uses
the weighted average number of ordinary shares.
4.(Loss) / Profit for the year
(Loss) / Profit for the year has been arrived at after charging/(crediting):
Six months ended 30 September 2023 Six months ended 30 September 2022
£'000 £'000
Depreciation of property, plant and equipment 70 69
Amortisation 24 23
Employee pension 10 3
Expected credit loss - license fees 8 -
Expected credit loss - outstanding loans (2) -
Expected credit loss - profit share (7) -
5. Revenue
The disclosure of revenue by product line is consistent with the revenue
information that is disclosed for each reportable segment under IFRS 8.
Disaggregation of revenue
Six months ended 30 September 2023 Six months ended 30 September 2022
£'000 £'000
External revenue by product line
License Fee Income 1,108 1,491
Profit Share Income - 18
Total Revenue 1,108 1,509
A further breakdown of revenue by reporting line is shown below:
Six months ended 30 September 2023 Six months ended 30 September 2022
£'000 £'000
External revenue by reporting line
License fees attributable to Mergers & Acquisitions (M&A) 800 1,142
License fees attributable to Other 308 349
Profit share attributable to M&A - 18
Total Revenue 1,108 1,509
6. Dividends
The final ordinary dividend for the year ended 31 March 2023 of £0.02 per
share as proposed in the 31 March 2023 financial statements and approved at
the Group's AGM was paid on 29 September 2023.
In addition, since the end of the half-year the Directors have recommended the
payment of an interim dividend of 1.25 pence per fully paid ordinary share.
The dividend will be paid on 12 January 2024 to shareholders on the register
on 15 December 2023 with the shares going ex-dividend on 14 December 2023. In
accordance with IAS10 "Events after the Balance Sheet Date", these dividends
have not been reflected in the Interim Report.
7. Investments
Group Group
As at 30 September 2023 As at 31 March 2023
£'000 £'000
Financial assets measured under the equity method
Investment in Associates 132 209
Investment in jointly controlled entities 30 39
Financial assets measured at amortised cost
Other investments 1,422 922
Total Investments 1,584 1,170
The movement in Investment in Associates and Investments in jointly controlled
entities is included in the cashflow statement as a decrease in amounts owed
from associates and jointly controlled entities in relation to profit share.
Where long-term loans are made to licensees, which are disclosed within "Other
investments" above, the Directors of the Company have accounted for them as
investments under IFRS 9. These loans are accounted for using the amortised
cost method.
On 12 July 2023, DSW Capital completed a transaction with Bridgewood Financial
Solutions Ltd, to acquire licence fee income and provide funding to support a
management buyout. As part of the transaction, DSW Capital have provided a
long-term loan of £780,000 to Bridgewood. The fair value of the loan has been
accounted for as an investment with the below market value element being
recorded separately within prepayments and accrued income, both as in
accordance with IFRS 9.
8. Trade and other receivables
Group Group
As at 30 September 2023 As at 31 March 2023
£'000 £'000
Trade receivables 1,126 965
Loss allowance (49) (41)
1,077 924
Other receivables 1,070 805
Loss Allowance (236) (238)
834 567
Prepayments and Accrued Income 947 528
Loss Allowance (5) (12)
942 516
2,853 2,007
Included in prepayments and accrued income are £631k (March 2023: £166k) due
in greater than 1 year. Other receivables are made up from loans due from
licensees, and prepayments and accrued income relates to profit share due from
licensees.
9. Related party transactions
Balances and transactions between the Company and its subsidiaries, which are
related parties, have been eliminated on consolidation and are not disclosed
in this note. Transactions between the Group and its related parties are
disclosed below.
Related parties are those licensees where the Company is a member of the
related LLP or has significant influence over an entity either via voting
rights or shareholding.
Revenue and Cost Recharges
Group entities entered into the following transactions with related parties
who are not members of the Group. All entities other than DSW Investments 2
LLP are licensee businesses. DSW Investments 2 LLP is an entity owned by
current significant shareholders.
Six months ended 30 September 2023 Six months ended 30 September 2022
Revenue and Cost Recharges Revenue and Cost Recharges
£'000 £'000
PHD Industrial Holdings 100 137
DSW Investments 2 LLP 53 51
Other investments 274 320
Totals 427 508
Other investments relate to routine and similar transactions which arose in
the ordinary course of business, with DSW CF Leeds, DSW TS Leeds, DSW Business
Recovery and DSW Bridgewood.
Amounts due from/to related parties
Group entities had the following balances, including loans to related parties,
outstanding at period end with related parties who are not members of the
Group:
30 September 2023 30 September 2022
Amounts due from/(to) related parties Amounts due from/(to) related parties
£'000 £'000
PHD Industrial Holdings 15 24
DSW Investments 2 LLP (32) (32)
Other investments 248 290
Totals 231 282
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. END IR NKQBPABDDCDBRecent news on DSW Capital
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