REG - Equals Group PLC - Final Results and Special Dividend
08/04/2025 07:00
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RNS Number : 0078E Equals Group PLC 08 April 2025
8 April 2025
Equals Group PLC
('Equals' or the 'Group')
Final Results and Special Dividend
Equals (AIM:EQLS), the fast-growing payments group focused on the SME
marketplace, announces its final results for the year ended 31 December 2024
(the 'year' or 'FY-2024').
FY-2024 Financial Summary
FY-2024 FY-2023 Change(1)
£ millions £ millions
GAAP Measures:
Revenue 131.7 95.7 +38%
% of revenue from B2B(2) 86% 84%
Gross profit 73.9 52.3 +41%
Administrative expenses 55.3 33.7 +64%
Profit after taxation 7.4 7.7 -4%
EPS:
Basic 3.93p 4.22p
Diluted 3.70p 4.00p
Non-GAAP Measures:
Underlying transaction values
- FX 7,832 5,866 +34%
- Banking 2,565 2,178 +18%
- Solutions Platform 7,820 4,368 +79%
- Total 18,217 12,412 +47%
Adjusted EBITDA (3) 28.3 20.6 +37%
EBITDA 18.8 17.1 +10%
Adjusted profit after taxation 19.6 13.1 +49%
Adjusted EPS:
Adjusted(4) Basic 10.41p 7.16p +45%
Adjusted(4) Diluted 9.80p 6.79p +44%
Other information:
Capitalised staff costs 5.9 5.7
Separately reported items (below Adjusted EBITDA) 3.6 2.1
Cash per share (at balance sheet date) 15.5p 10.2p
FY-2024 Financial Highlights
· 47% increase in transaction flow to £18.2 billion (FY-2023:
£12.4 billion)
· 38% increase in revenue to £131.7 million (FY-2023: £95.7
million)
· 37% increase in Adjusted EBITDA(3) to £28.3 million (FY-2023:
£20.6 million)
· Dividend payments of £3.8 million (FY-2023: £0.9 million)
· Robust Balance sheet with £29.2 million cash at bank at 31
December 2024
Recommended Cash Acquisition by Alakazam Holdings Bidco Limited ('Bidco')
On 11 December 2024, the Boards of Equals and Bidco announced that they had
reached an agreement on the terms of a recommended all cash acquisition of the
entire issued and to be issued ordinary share capital of Equals (the
'Acquisition').
Under the terms of the Acquisition, Equals Shareholders shall be entitled to
receive 140 pence in cash, comprising a cash consideration of 135 pence per
share plus a special dividend payment of 5 pence in cash per share (the
'Special Dividend'). The offer values the entire issued and to be issued
ordinary share capital of the Group at approximately £283 million on a fully
diluted basis.
The Acquisition is to be effected by means of a Court-sanctioned scheme of
arrangement under Part 26 of the Companies Act 2006 (the 'Scheme') and is
subject to the terms and conditions set out in the scheme document relating to
the Acquisition (the 'Scheme Document') published on 17 December 2004.
Unless otherwise defined, all capitalised terms in this announcement have the
meaning given to them in the Scheme Document.
As announced on 8 January 2025, the Scheme was approved by the requisite
majority of Scheme Shareholders at the Court Meeting held on 8 January 2025
and the Special Resolutions relating to the implementation of the Scheme were
also approved by the requisite majority of Equals Shareholders at the General
Meeting also held on 8 January 2025.
As announced on 1 April 2025, the Regulatory Conditions set out in paragraphs
3.2 to 3.7 of Part III (Conditions to the Implementation of the Scheme and to
the Acquisition) of the Scheme Document have now been satisfied.
Completion of the Acquisition remains subject to the Court's sanction of the
Scheme at the Court Hearing, the delivery of a copy of the Scheme Court Order
to the Registrar of Companies and the satisfaction (or, where applicable,
waiver) of the remaining Conditions set out in Part III (Conditions to the
Implementation of the Scheme and to the Acquisition) of the Scheme Document.
The Court Hearing to sanction the Scheme is scheduled to be held on 10 April
2025 and subject to the satisfaction (or where applicable, waiver) of the
remaining Conditions, the Scheme is expected to become Effective on 14 April
2025. The last day of dealings in, and for registration of transfers of,
Equals Shares is therefore expected to be 11 April 2025, with all dealings in
Equals Shares being suspended at 7.30 a.m. on 14 April 2025. It is also
expected that the admission to trading of Equals Shares on AIM will be
cancelled with effect from 7.00 a.m. on 15 April 2025.
If any of the key dates and/or times set out above change, the revised dates
and/or times will be notified to Equals Shareholders by issuing an
announcement through a Regulatory Information Service, with such announcement
being made available on Equals' website (www.equalsplc.com/strategic-review
(http://www.equalsplc.com/strategic-review) ).
Special dividend
As part of the Acquisition, the Board is pleased to declare a special dividend
of 5.0 pence per share. Subject to the Scheme becoming effective, the
special dividend will be payable to shareholders on the register at 6pm on 11
April 2025, and will be paid by 28 April 2025. On the basis that the special
dividend is being paid as part of the Acquisition there is no associated
ex-dividend date.
The most secure way for eligible shareholders to receive their dividends will
be to have them paid directly into their nominated bank account. Shareholders
can action this by adding their bank details into the Signal Shares portal of
our Registrar, MUFG Corporate Markets, using the following link
https://uk.investorcentre.mpms.mufg.com/Login/Login
(https://urldefense.com/v3/__https:/uk.investorcentre.mpms.mufg.com/Login/Login__;!!H_q-o1I4kFo!mdjT0fNR-uf82qTGkCCqL2kxYtgzi8zoCrmfYLcr9jP4lfrA-PX_wUgqbMNgjqsvMdwud_gPbVzetWIRpUq2z8QJ4ufyYW0ySTkbZhaDmg$)
. Additionally Equals, will, on its investor relations website
(www.equalsplc.com (http://www.equalsplc.com) ), include a guide to this.
Commenting on the Final Results, Ian Strafford-Taylor, CEO of Equals Group
PLC, said: "We continued to grow strongly in 2024, achieving strong levels of
revenue, adjusted EBITDA, and operational cash generation. We also expanded
internationally, broadened our product offering and hired greater talent to
take the Group forward. I am immensely proud of the workforce that allowed
us to reach these levels of performance, and I want to thank them all for
their efforts in achieving these results.
"However, and as previously stated, the highly competitive nature of the
payments market, and the considerable investment required to
'stay-ahead-of-the-game' led the Board to conclude that private ownership by
well-funded partners would be a better route for the Group with shareholders
having approved the terms of the Acquisition, which is now expected to
complete on 14 April 2025.
"These results are therefore likely to be the last that Equals announces as a
public company and I would like to thank shareholders for their continued
support for the business since our IPO in 2014."
FY-2024 Annual Report
An electronic copy of the Annual Report and Financial Statements for the year
ended 31 December 2024 will be posted on the Group's website
(www.equalsplc.com). at midday today, and be available at Companies House once
filed.
Notes
(1) Based on underlying, not rounded, figures.
(2) Transactions with business customers are reported as 'B2B' and
transactions with retail customers are reported as 'B2C'.
(3) Adjusted EBITDA is defined as: earnings before; depreciation,
amortisation, impairment charges, share option charges, foreign exchange
differences and separately reported items. Separately reported items are of a
material nature, non-recurring items. A bridge to Adjusted EBITDA is provided
on table 1 in the CFO report.
(4) The measure of profit for this ratio has been adjusted to form Adjusted
EPS. The add-back adjustments consist of share option charges, amortisation of
acquired intangibles, exceptional items, acquisition costs and tax impacts on
these items thereon.
The financial statements were approved for release at 07:00 hours on 8 April
2025 to the London Stock Exchange via RNS after being approved by the Board
after stock market hours on 7 April 2025.
For more information, please contact:
Equals Group PLC
Ian Strafford-Taylor, CEO Tel: +44 (0) 20 7778 9308
Richard Cooper, CFO www.equalsplc.com (http://www.equalsplc.com)
Canaccord Genuity (Nominated Advisor / Broker)
Max Hartley / Harry Rees Tel: +44 (0) 20 7523 8150
Burson Buchanan (Financial Communications)
Henry Harrison- Topham / Steph Whitmore / Toto Berger Tel: +44 (0) 20 7466 5000
equals@buchanan.uk.com (mailto:equals@buchanan.uk.com) www.buchanan.uk.com (http://www.buchanan.uk.com)
Notes to Editors:
Equals Group is a technology-led international payments group augmented by
highly personalised service for the payment needs of SME's whether these be
FX, card payments or via Faster Payments. Founded in 2007, the Group listed on
AIM in 2014. For more information, please visit www.equalsplc.com
(http://www.equalsplc.com) .
Chief Executive Officer's Report
The vision for the Group is to 'make money movement simpler' for corporate
customers. Equals achieves this by giving its corporate customers access to
payment and transactional capabilities that were previously only available via
Banks. Given the typically often dated state of the infrastructure at Banks,
coupled with the long lead times to become a customer, there is a clear
opportunity for Equals to provide value-added services to the B2B space.
Equals services its corporate customers via its B2B platforms, being Equals
Money, which is targeted at SME customers, and Equals Solutions, which targets
larger corporate opportunities. The Group's growth potential continues to be
strong given that the core building blocks of its platforms, namely own-name
multi-currency IBANs, proprietary technology, and bank-grade connectivity and
clearance, are highly complex and time consuming to replicate. This market
position was achieved by the investments made in previous years into
technology and connectivity and will be continuously enhanced by further
investment.
Against this vision, the Board's objective for FY-2024 was to expand the reach
of our B2B platforms and thereby increase the Total Addressable Market ('TAM')
for our services. Equals achieved this objective by increasing the
capabilities to connect to our platforms via API integrations, expanding our
white-label capabilities and allowing our customers to transact both directly
with Equals or 'indirectly' where Equals provides the platform for our B2B
customers to transact with their underlying customer, so called B2B2C or
B2B2B.
The advances the Group made in its offering, combined with improved Sales and
Marketing capabilities, meant the Group delivered the following strong
headline financial performance:
· Transactions executed on the Group's platforms increased by 47%
to £18.2 billion (FY-2023: £12.4 billion)
· Revenue increased by 38% to £131.7 million (FY-2023: £95.7
million)
· Adjusted EBITDA increased by 37% to £28.3 million (FY-2023:
£20.6 million)
· Adjusted PBT increased to £19.6 million (FY-2023: £13.1
million)
A detailed financial analysis is presented in the Report of the Chief
Financial Officer, which follows this statement.
Growth with control and investment
Total transaction volumes processed by our platforms increased 47% to £18.2
billion (FY-2023: £12.4 billion), with increases across all payment channels,
and reflects the scalability of the platform that has been built, and the
operational processes that support it.
Revenues also grew strongly, posting a 38% increase to £131.7 million
(FY-2023: £95.7 million). The revenues grew slower than transaction volumes
in percentage terms is not due to pressure on margins, rather it reflects
Equals winning larger corporate business which is typically higher volumes at
lower spreads.
The Group's focus on distribution to B2B customers is reflected in the
breakdown of revenues of which 86% were derived from B2B customers, up from
84% in FY-2023. Similarly, our success in attracting larger corporate
customers, especially via the Equals Solutions platform, is reflected in 43%
of revenues being derived from this category, compared to 33% in FY-2023.
Analysing revenue trends further, growth continues to be centred around a very
strong uptake of our Solutions platform augmented by solid performance from
the core products within Equals Money. Specifically, Equals Solutions
revenues grew by 80% to £55.8 million (FY-2023: £31.0 million),
International Payments (including White Labelled FX services) grew 21% to
£47.7 million (FY-2023: £39.4 million), and card-based revenues grew 1% to
£15.3 million (FY-2023: £15.2 million).
The increase in transaction volumes and revenues resulted in strong growth in
profits, with Adjusted EBITDA up 37% to £28.3 million (FY-2023: £20.6
million).
Regulators across the globe are increasingly focused on anti-money laundering
('AML') and compliance standards. Equals welcomes higher levels of
supervision as we view our compliance controls and governance to be a
competitive advantage. Equals instils a Group-wide compliance culture
facilitated by regular, compulsory training for all employees. The Group has
continued its investment in this area with increased headcount and expertise
being added across onboarding, enhanced due-diligence, transaction monitoring,
risk, compliance and regulatory teams. In addition to the investment in
people, the Group has deployed compliance technology and tooling to automate
tasks where possible.
The philosophy of 'growth with control and investment' extends to our product
and engineering functions. All customer-facing product developments are
built with the involvement of all areas of the business to ensure Equals
creates end-to-end applications that support internal operational efficiency
as well as superior customer user experience ('UX'). In addition, in 2024 we
increased the proportion of our technical roadmap that is dedicated to
improving internal efficiency and control, not just outward facing product
rollouts.
Control whilst investing within Engineering and IT is further enhanced by the
Group operating a monthly Security Council, with membership including Board
members and all key departments. The approval of the Council is required to
progress new products, product changes, new software usage and vendor
approval. The Security Council also conducts a review of any security
incidents at each meeting and authorises any changes required. The
robustness of our governance is just part of the reason the Group has ISO/IEC
27001 status, the leading international standard focused on Information
Security Management. This independent accreditation testifies to the
strength of the technology platform that has been built as well as the
processes and controls that we operate.
Sustained investment in people
The success of the Group is directly attributable to its excellent employees.
Equals has a defined culture which we espouse through our core values, being
Make it happen, Succeed together, Be the customer, and Go beyond. We have
monthly awards for the employees who have excelled in each value and have been
nominated by their colleagues. Equals values not just individual employees,
but teamwork and togetherness - the 'Equals Family'.
In this vein, Equals continues to invest in its employees and consistently
looks to implement measures to enhance the work environment. The Group
utilises benchmarking to ensure it provides a strong benefits programme and it
continues to support a hybrid working policy. The health and wellbeing of
employees is taken very seriously, and the Group has implemented many
programmes to support this.
As part of the development of our employees, the Group has a bi-annual
appraisal process, which also drives salary reviews and incentive plans. The
appraisal process includes input from not just the individual and their
manager, but also from colleagues. The Group is proud to have a diverse
workforce, and it strives to train and promote from within where possible.
Overall, investment in People has resulted in the Group having a low level of
staff turnover amongst key employees.
Headcount increased to 400 on 31 December 2024, up 9% from 367 at the end of
2023 reflecting the Group putting in place the resources needed for our next
phase of growth in 2025 and beyond. In keeping with our strategy of 'growth
with control' the additional recruitment has been concentrated in revenue
production areas (sales and marketing) together with increases in onboarding,
compliance and operations.
We expect headcount to continue to grow, but at much lower rates than revenue
expansion, in 2025.
Equals position in the payments space
The global payments industry is fundamental to the global economy. Without
an efficient payments industry, global trade suffers. Global payments
represents a multi-trillion dollar market that remains a complex and
constantly evolving space. Despite the importance of payments, whilst
technology has seen radical changes in many industries, payments had not
evolved at the same pace until relatively recently. In part this is because
of its importance, if changes are made and they fail, the consequences are
far-reaching. We have seen many times when Banks attempt to upgrade their
systems and there are major outages. Therefore, we still see a prevalence of
legacy payment mechanisms of cash, cheques, account-to-account transfers and
more latterly cards dominating the landscape. Furthermore, the settlement
rails that support these payment methodologies were frequently decades old.
The problems that this created were even more acute when making
international, or cross-border, payments as settlement rails in one country
frequently did not interface with those in another.
The 21(st) century has seen more investment into payments and more disruptive
technology being applied which has changed the long-standing status quo and
introduced new participants into the space, known as 'fintech' businesses.
The advent of cryptocurrencies, and concurrently blockchain, has further
accelerated the rate of change such that payments in general are now evolving
at a rapid pace.
It is the rapid evolution that we now see that provides the fundamental
opportunity for Equals as we can provide our corporate customers access to
payment methodologies that they cannot access via traditional Banks.
Accordingly, the Group has invested into technology and people over several
years to carve out a specific niche for Equals, focused on the B2B customer
space. This investment has yielded a powerful proposition that provides its
customers with both account-to-account transfers and card payments in one
multi-currency platform built on infrastructure giving bank-grade connectivity
and security on superior customer interfaces. Equals customers can access
this platform directly via the secure login, on a white-label basis, or via an
API technical interface. The flexibility the Group can support and the
channels by which this can be consumed by customers is a key differentiator.
Within Equals B2B focus, the Group targets two major segments, SMEs, via
Equals Money, and larger corporates, via Equals Solutions. Both offer a
single platform comprising own-name, multi-currency IBAN current accounts,
account-to-account transfers, and card products for both domestic and
international transactions.
Competition and differentiation
The Group's competitors fall into two major categories: the incumbent banks;
and the fintech 'disruptors' that have come into the market in recent years.
Despite the growth of fintech companies, the majority of payment volumes
continue to flow through the incumbent banks, in some part due to customer
inertia and the difficulty of switching providers. Accordingly, for Equals,
the key is to target the customer base of the incumbent banks whilst
concurrently making it easy for those customers to consume the products and
services of the Group. These twin challenges are addressed by continued
investment into both product development and our customer onboarding
capabilities to provide a rapid process whilst retaining control.
Fintech competitors, in contrast to the incumbent banks, tend to focus on one
product component of what Equals provides as an overall platform. In
addition, they are often B2C focused, therefore focusing on a different
customer base than Equals. Further, fintech companies typically operate
'self-serve' platforms where the user must consume the standard product
whereas Equals platforms are highly configurable to fit the requirements of
the user. Lastly, fintech companies rarely provide human interaction in terms
of onboarding, implementation and ongoing support whereas Equals provides
leading technology allied with human assistance in supporting customers to
navigate the complexities of payments via dedicated account management teams.
The Group therefore differentiates itself by harnessing the best of these two
competitor groups, namely the trust, security and heritage of the incumbent
banks combined with the technological innovation of the fintech community.
Accordingly, Equals will continue to invest in its platform, connectivity,
and payment rails to remain one step ahead and its success in doing so to date
is clearly reflected in the Group's FY-2024 results.
ESG
In keeping with prior years, Equals remains committed to ESG initiatives and
the Group takes Equality, Diversity, and Inclusivity ('EDI') extremely
seriously. Our EDI strategy, which covers not only employees but also
customers, includes an internal EDI network populated with elected
representatives and regular employee surveys.
Outlook
The outlook for Equals Group remains strong, because of our outstanding people
combined with sustained investments in technology and connectivity.
Concurrently, the Group has consistently widened its addressable market via
new distribution channels and geographical expansion. Equals has created a
highly configurable payments platform comprising international and domestic
payments, card payments and current account services underpinned by
exceptional technology and direct connections to multiple payment networks.
Accordingly, we look to the future with confidence.
Ian Strafford-Taylor
Chief Executive Officer
7 April 2025
Chief Financial Officer's Report
The Strategic Review, launched in Q4-2023 has impacted the overall, but not
the underlying results for the year, with trading revenues growing by 21%, and
total revenues, significantly benefitting from robust interest rates and
growing customer balances, which grew by 38%. Adjusted* EBITDA also grew
strongly by 37% to £28.3 million. The professional fees and other costs
incurred on the Strategic Review in 2024 were £3.6 million. Normalised**
EBIT was 34% higher at 13.9 million (2023: £10.4 million). Share option
charges reflected a full year of charges related to the LTIP awards in
December 2022 and November 2023). Higher profits have led to a higher tax
charge.
A summary income statement is shown below.
TABLE 1: INCOME AND EXPENSE ACCOUNT
FY-2024 FY-2023
£ millions £ millions
Revenue (table 3) 131.7 95.7
Gross Profits (table 4) 73.9 52.3
Less: Marketing (4.0) (2.6)
Contribution 69.8 49.8
Staff costs (28.7) (20.3)
Property and office cost (1.5) (1.2)
IT and telephone costs (5.8) (3.2)
Professional Fees (2.4) (2.2)
Compliance costs (2.4) (1.5)
Travel and other expenses (0.8) (0.7)
Adjusted EBITDA 28.3 20.6
Less: Share option expense (6.0) (1.4)
Less: Acquisition costs (table 5) - (1.4)
Less: Exceptional items (3.6) (0.7)
EBITDA 18.7 17.1
IFRS 16 Depreciation (table 7) (0.7) (0.7)
Other depreciation (table 7) (0.5) (0.5)
Amortisation of acquired intangibles (table 8) (1.6) (1.7)
Other amortisation (table 8) (5.8) (5.4)
(8.6) (8.3)
Contingent consideration credit - 0.5
Gain on Disposal of Cash CGU - 0.4
Research and Development Income 0.2 -
(8.4) (7.4)
EBIT 10.3 9.7
Lease interest (0.1) (0.2)
Foreign exchange differences (0.1) (0.3)
Contingent consideration finance credits/(charges) 0.1 (0.1)
(0.1) (0.6)
PROFIT BEFORE TAXATION 10.2 9.1
Corporate and deferred taxation (2.7) (1.4)
PROFIT FOR THE YEAR 7.4 7.7
*Adjusted EBITDA is EBITDA before exceptional items, non-cash share option
expenses and costs incurred in acquisitions.
**Normalised EBIT is stated before Exceptional Items.
When the changes are presented as a bridge, the standout facts are the
increase in revenue leading to increased contribution (gross profits less
marketing costs), offset by higher labour costs, both through planned
increases in staff resources and responding to labour market pressures.
Other cost increases were also a mix of inflation pressures, but also
decisions taken to upskill and upscale resources for a rapidly growing
business.
TABLE 2 - ADJUSTED EBITDA BRIDGE FROM FY-2023 TO FY-2024 (in £'000s)
FY-2023 Adjusted EBITDA 20,637
Add: 40% uplift in contribution FY-2024 20,076
Less: 41% increase in staff costs, reflecting a higher planned headcount, (8,400)
particularly in compliance and onboarding roles.
79% increase in IT and communications, largely through increased web hosting (2,541)
charges and development tools in line with transaction growth.
29% increase in professional and compliance costs, much of which is
attributable to increased professional and compliance including regulatory
fees in line with geographical expansion.
(1,079)
26% increase in property costs reflecting a full-years charge for EU (304)
operations (2023 - 6 months)
Increase in other costs including travel and entertaining costs incurred (115)
through ambassadorial initiatives and industry awareness events.
FY-2024 Adjusted EBITDA 28,274
Uplift over FY-2023 7,637
% uplift over FY-2023 37%
Revenue
All product lines and all verticals saw significant increases in revenue in
the year. The Group has concentrated on the corporate sector and has seen
strong growth in International Payments, White-Label and Solutions business
lines, and modest growth in consumer and small businesses. The Group
stabilised its EU revenues and structurally removed some revenue not linked to
its current strategy.
Shown below, revenue by type, followed by revenue by product line with an
allocation of interest based on the customer balances within each segment.
TABLE 3 - REVENUE BY CUSTOMER TYPE
The table below shows the revenue by half year periods, split by customer
grouping and within than the type of business provided.
By income type
£ millions H1-2023 H2-2023 TOTAL H1-2024 H2-2024 TOTAL
FY-2023 FY-2024
FX 24.7 22.4 47.1 25.1 29.9 55.0
Fees 16.1 21.3 37.4 25.0 29.8 54.8
Total, trading revenue 40.8 43.7 84.5 50.1 59.6 109.8
Interest 4.2 7.0 11.2 9.8 12.1 21.9
Total 45.0 50.7 95.7 60.0 71.7 131.7
Revenue in H1-2024 grew by 33% over the same period in 2023, then by 18.3%
over the prior half year, Revenues in the second half continue to grow
strongly; 41% over H2-2023 and 19.5% above H1-2024.
By segment, including interest allocated to segments
£ millions H1-2023 H2-2023 TOTAL H1-2024 H2-2024 TOTAL
FY-2023 FY-2024
International Payments 9.2 9.7 18.9 10.3 12.4 22.7
Cards 4.8 5.4 10.2 4.7 5.1 9.8
Medium enterprises 14.0 15.1 29.1 15.0 17.5 32.5
International Payments 1.9 1.9 3.8 2.6 2.0 4.6
Cards 2.4 2.6 5.0 2.7 2.8 5.5
Banking 4.1 4.2 8.3 4.0 4.7 8.7
Consumer and small business 8.4 8.7 17.1 9.3 9.5 18.8
White-label 8.9 7.8 16.7 8.6 11.8 20.4
Large enterprises ('Solutions') 13.6 17.4 31.0 24.8 31.0 55.8
Europe - 1.7 1.7 2.3 2.0 4.3
Bureau de change 0.1 - 0.1 - - -
Total 45.0 50.7 95.7 60.0 71.7 131.7
Interest
Interest income on safeguarded customer funds rose 96% to £21.9 million, up
from £11.2 million in 2023.
Interest is earned on balances maintained in GBP, EUR and USD. Interest
earning balances have risen sharply from an average of £313 million in
H1-2023 to £350 million in H2-2023, £485 million in H1-2024 to £625 million
in H2-2024.
The impact of the growth of balances, more than offsets the recent reductions
in global interest rates.
Interest is a key component of pricing across all product segments by
dominated by Solutions. Thus, revenue by segment is shown gross of interest.
Revenue by distribution channel
The Group has two distribution channels: direct, or via affiliates. The
Group has been building up its direct sales team which naturally increases
staff costs, but, produces a higher gross margin as there is less 'pay-away'
to affiliates and staff commissions can be controlled better.
Revenue from direct channels is around 54% of the total, marginally up on
FY-2023 (52%).
Revenue by customer type
The Group has been pivoting away from its B2C origins for some time, disposing
of the FX Bureau in March 2023 and having little focus on marketing to B2C
customers in cards ('FairFX') and in Banking ('CardOneMoney').
The percentage of revenue from B2B has increased from 83.8% in FY-2023 to
85.7% in FY-2024.
Revenue by type
As the Group develops, it has not only pivoted away from B2C but also focused
towards more recurring revenue. Of the trading revenue, fees represented 50%
compared with 44% in 2023.
Revenue by segment
a. Solutions
Solutions now represents over 42% of Group revenues.
The investment in technology, systems and compliance processes to enable the
Solutions product to be sold to international customers with complex payment
needs evolved several years ago and enabled a launch in H1-2021. Since then,
revenues (with interest allocated) have grown thus:
£ millions
H1-2021 0.3
H2-2021 3.3
H1-2022 6.2
H2-2022 9.4
H1-2023 13.6
H2-2023 17.4
H1-2024 24.8
H2-2024 31.0
b. International Payments
Revenue increased from £22.7 million in 2023 to £27.3 million in 2024 at
20.3%.
c. White-label
Revenue increased from £16.7 million in 2023 to £20.4 million in 2024 an
increase of 22% despite difficult headwinds and intense competition.
d. Cards
The Group continues to operate FairFX its retail-focused card product, but
increasingly concentrates on the Corporate section with a relaunched Equals
Money card.
Retail revenues were:
£5.5 million, up from £5.0 million in 2023
Corporate revenues were: £9.8
million, marginally lower than in 2023
e. Banking
The 'CardOneMoney' platform also serves both B2B and B2C, but is a non-core
product and receives minimal marketing investment. Its revenue remains
relatively static at £8.7 million (2023: £8.3 million).
f. Europe
The Group's acquisition in July 2023 was fully remediated and restructured in
2024. Certain revenue streams were eliminated as they did not fit into the
Group's strategy and risk appetite. Despite this, revenue increased to £2.0
million in H2-2024 from £1.7 million in the same period in the prior year.
GROSS PROFITS
Whilst revenues have grown by 38% over the same period last year, Gross
Profits increased by 41%. This is a result of the impact of interest income
(which has no associated cost), and the changing mix of business including a
greater percentage being derived from direct sales as opposed to affiliates.
Gross profit ratios over the half year periods are shown below:
TABLE 4 - GROSS PROFIT MARGIN %
H1-2023 H2-2023 Total H1-2024 H2-2024 Total
FY-2023 FY-2024
International Payments 57% 58% 57% 62% 61% 61%
Cards 65% 67% 65% 66% 54% 58%
Medium enterprises 59% 61% 60% 63% 57% 60%
International Payments 68% 68% 68% 68% 56% 60%
Cards 58% 61% 60% 63% 54% 54%
Banking 85% 84% 84% 83% 80% 82%
Consumer, and small business 74% 74% 74% 75% 67% 71%
White-label 19% 21% 20% 21% 28% 25%
Large enterprises (Solutions) 54% 60% 57% 61% 61% 61%
Cash (affiliate from H2-2023) 31% 87% 36% 60% 73% 68%
Europe - 56% 56% 57% 47% 50%
Total 52% 56% 55% 57% 55% 56%
Marketing, branding and contribution
The Group has actively managed its marketing expenditure more closely having
carried out a thorough review and a constant assessment of 'Return on Spend'.
Increased marketing expenditure in 2024 is focused on hospitality events and
exhibitions. Marketing, as a percentage of Revenue is 3.1% (2023: 2.7%).
Staff costs
Reported here staff costs exclude commissions and associated Employers NI
which are shown within Gross Profits.
Staff costs below the Gross Profit line and gross of capitalisation and
exceptional items were £35.9 million in FY-2024 against £25.9 million in
FY-2023. This increase was attributable to:
· Organic headcount increases (headcount numbers have moved from
367 as at 31 December 2023 to 400 as at 31 December 2024). Recruitment costs
fell to £738k (but includes a number of higher recruitment costs for Exec and
senior hires) in 2024 against £969k in 2023. 2024 saw the recruitment of 85
new employees in the UK (2023: 149).
· Wage pressures, where the aggregate increases were around 8.5%.
Gross staff costs have been offset by £5.9 million of capitalised internal
software (FY-2023: £5.7 million), which included £3.3 million on contractors
(FY-2023: £2.4 million). The amounts capitalised represent 16.4% of gross
staff costs, reduced from 21% in 2023 largely due to inflation impacting
contractor costs.
The composition of headcount is approximately: Commercial, 22%; Compliance,
15%; Operations (excluding risk & compliance), 23%; Engineering, 15%;
Product and EU operations, 10%; Finance and HR, 9%; Other, 6%.
Professional fees and Compliance costs
Owing to an increasing cross-industry compliance burden, the Group has chosen
to report compliance, and similar costs separate to other professional fees.
Such costs, including onboarding systems, have risen due to a combination of
greater business activity and the Group's desire to fast-track business
applications proactive with regulation.
Professional fees have risen in line with trends widely reported in the
national press, most notably the provision for the cost of the audit noting
increased acquisition activity and implementation of enhanced systems.
Exceptional items
In connection with the Strategic Review announced on 1 November 2023 and the
implementation of the Acquisition that followed, the Group incurred costs of
£3.6 million in FY-2024, of which £2.3 million related to professional fees
and £1.3 million to retention bonuses.
Dividend Payments
The Group paid two dividends of 1.00 pence per share to the shareholders of
Equals Group PLC in 2024:
- Final dividend of 1.0 pence per share announced in the final
results published on 16 April 2024 with a total cash payment of £1,876k on 28
June 2024.
- Interim dividend of 1.0 pence per share announced as part of the
Interim Results released on 10 September 2024 with a total cash payment of
£1,885k on 25 October 2024.
Acquisitions
The following two tables present the purchase consideration for acquisitions
made since 1st January 2023, along with the cash and equity transferred in
connection with these acquisitions.
TABLE 5 - ACQUIRED ASSET CONSIDERATION THROUGH ACQUISITIONS
Total Roqqett Hamer & Hamer EMEU
Acquisition date 06.01.2023 20.04.2023 04.07.2023
£'000s £'000s £'000s £'000s
Value on balance sheet at 01.01.2023 - - - -
Acquisitions in 2023 12,667 1,550 2,268 8,849
Fair value and deferred tax adjustments in 2023 3,391 664 339 2,388
Total Consideration on balance sheet at 31.12.2023 16,058 2,214 2,607 11,237
Total Consideration on balance sheet at 31.12.2024 16,058 2,214 2,607 11,237
Comprising:
Cash paid at acquisition 1,669 169 1,500 -
Cash paid at acquisition for acquired liabilities 2,461 - - 2,461
Cash paid post-acquisition 2,709 1,215 19 1,475
Total cash paid for acquisitions 6,839 1,384 1,519 3,936
Shares issued at acquisition 3,190 - - 3,190
Shares issued post-acquisition 810 - - 810
Total shares issued paid for acquisitions 4,000 - - 4,000
Total cash paid and shares issued for acquisitions 10,839 1,384 1,519 7,936
Fair Value on shares issued 694 - - 694
Performance assessed consideration thereon 233 35 148 50
Capitalised incidental expenses 131 131 - -
Acquired liabilities payable in cash 169 - - 169
Deferred consideration payable in cash* 601 - 601 -
Total consideration transferred 12,667 1,550 2,268 8,849
Fair Value thereon 2,413 664 (30) 1,779
Deferred tax thereon 978 - 369 609
Total acquired 16,058 2,214 2,607 11,237
Goodwill 9,930 - 1,129 8,801
Other intangible assets:
Open Banking Technology 2,214 2,214 - -
Customer Relationships 3,914 - 1,478 2,436
Total intangibles acquired 16,058 2,214 2,607 11,237
*the earnout which relates to Hamer & Hamer and are payable on the 1st,
2nd and 3rd anniversaries of the acquisition if targets are met. The maximum
earn out is £1.7 million over the three-year period, of which £19k has been
paid on the first anniversary and the remainder has been fair valued to £0.6
million is payable over the next two years.
TABLE 6 - CASH AND EQUITY TRANSFERRED FOR ACQUISITIONS
Total Cash Total Casco Roqqett Hamer & Hamer Equity Total EMEU
Acquisition date 19.11.2019 06.01.2023 20.04.2023 04.07.2023
£'000s £'000s £'000s £'000s £'000s £'000s £'000s
Gross outstanding at 01.01.2023 2,025 2,025 2,025 - - - -
Acquisitions in 2023 8,669 4,619 - 1,419 3,200 4,050 4,050
Cash payments in 2023 (3,476) (3,476) (1,092) (884) (1,500) - -
Shares issued in 2023 (3,190) - - - - (3,190) (3,190)
Revaluation of asset based on performance in 2023 (1,441) (1,391) (424) (35) (932) (50) (50)
Gross Outstanding at 31.12.2023 2,587 1,777 509 500 768 810 810
Cash payments in 2024 (1,028) (1,028) (509) (500) (19) - -
Shares issued in 2024 (810) - - - - (810) (810)
Revaluation of asset based on performance in 2024 (148) (148) - - (148) - -
Gross Outstanding at 31.12.2024 601 601 - - 601 - -
Depreciation
Tangible fixed assets are depreciated over the anticipated useful life with a
maximum of 60 months (other than leasehold improvements which is a maximum of
120 months).
TABLE 7 - DEPRECIATION
FY-2024 FY-2023
£'000s £'000s
IFRS 16 depreciation 711 692
Other depreciation 450 536
1,161 1,228
Amortisation
Intangible assets acquired on acquisition are amortised over their estimated
useful lives, with a maximum of 60 months for brands and a maximum of 108
months for customer relationships. The charge to amortisation for the year
can be analysed as follows:
TABLE 8 - COMPONENTS OF AMORTISATION CHARGES
FY-2024 FY-2023
£'000s £'000s
Amortisation charge arising from the capitalisation of internally developed
software in the following years:
2018 and earlier 260 545
2019 940 1,661
2020 924 893
2021 666 599
2022 903 791
2023 1,041 506
2024 628 -
5,362 4,995
Amortisation charge for other intangibles 419 381
5,780 5,376
Amortisation of acquired intangibles 1,611 1,672
Total amortisation charge 7,392 7,048
Operating result
The Group made a profit before taxation of £10.2 million for the year,
compared to £9.1 million for FY-2023.
Taxation, incorporating R&D credits
The Group has recognised a net tax charge of £2.7 million for FY-2024
(FY-2023: £1.4 million). At the balance sheet date, the Group estimates it
has usable tax losses of £4.4 million.
TABLE 9 - BALANCE SHEET
This table shows a compressed "balance sheet" for the Group.
31.12.2024 31.12.2023
£'000s £'000s
Internally generated software - cost 38,725 32,207
Internally generated software - accumulated amortisation (23,768) (18,407)
14,957 13,800
Other non-current assets (other than 'right to use') 30,985 32,949
IFRS 16 assets, less IFRS 16 liabilities (527) (599)
45,415 46,150
Liquidity (see Table 12) 25,316 17,803
Accrued Income and Trade Debtors 7,493 6,503
Net value of forward contracts* 1,490 358
Prepayments 2,563 1,789
Deferred consideration receivable from the sale of the FX bureau - 100
Inventory of card stock 165 372
Other Sundry Debtors 294 196
Current assets - as presented in this format 37,321 27,121
Less:
Accounts payable (2,850) (2,831)
Affiliate commissions (3,901) (3,135)
PAYE and Pension Liabilities (1,138) (1,023)
Staff commissions and accrued bonuses (3,708) (2,391)
Purchase accruals and other creditors (5,233) (3,700)
Accrued acquired liabilities for EMEU. (169) (1,519)
Earn-out balances due** (601) (1,777)
Net deferred income tax credit (2024 RDEC)** (748) -
Net corporation and deferred taxes (404) (1,152) 849 849
Liabilities - as presented in this format (18,752) (15,527)
Net, as presented in this format 18,569 11,594
NET SHAREHOLDER FUNDS 63,984 57,744
At 31 December 2024, the Company has distributable reserves of £18,543k. This
is equivalent to £0.10 per share.
*The gross value of the forwards book at 31st December 2024 was £280.2
million (31st December 2023: £315.3 million)
**Taxation and R&D expenditure credit
The Financial statements for the full year of 2024 are be prepared under the
'RDEC' scheme as Equals will have exceeded the SME scheme limits on revenue
and gross assets.
Under the RDEC scheme, the accounting treatment recognises the credit as an
'above the line' adjustment.
This allows 20% of eligible R&D expenditure (staff and IT costs) to be
credited to the balance sheet and then released to the P&L as either:
· other income; or
· netted off against R&D costs, such as staff costs on the
income statement.
This credit is subject to corporation tax, resulting in an effective tax rate
of 15%, compared to 21.5% under the SME scheme.
The value of the scheme is accounted for in the P&L over five accounting
years, as opposed to one year under the SME scheme, so the impact of the RDEC
scheme appears marginally dilutive. The tables below show the impact on the
financial statements.
TABLE 10: IMPACT OF RDEC SCHEME
With RDEC
applied
Before RDEC applied
£ millions FY-2024 FY-2023 FY-2024 FY-2023
Adjusted EBITDA before RDEC 28.3 20.6 28.3 20.6
Impact of RDEC 0.2 0.2 - -
Revised EBITDA 28.5 20.8 28.3 20.6
Taxation charge before RDEC 1.4 1.4 1.4 1.4
Impact of RDEC 1.3 1.3 - -
Revised taxation charge 2.7 2.7 1.4 1.4
Profit after tax before RDEC 8.5 7.7 8.5 7.7
Impact of RDEC (1.1) (1.1) - -
Revised profit after tax 7.4 6.6 8.5 7.7
EPS: FY-2024 FY-2023 FY-2024 FY-2023
Basic 3.93p 3.59p 4.51p 4.22p
Diluted 3.70p 3.41p 4.25p 4.00p
Adjusted Basic 10.41p 6.53p 10.99p 7.16p
Adjusted Diluted 9.80p 6.20p 10.35p 6.79p
Share capital - Ordinary shares of £0.01 each
Number at 01 January 2024 186,627,898
Final tranche of shares issued pursuant to EMEU. acquisition, issued 4 January 1,000,000
2024
Options exercised by a former employee, 24 July 2024 904,800
LTIP vesting, 18 October 2024 1,838,800
Number in issue 31 December 2024 and 07 April 2025 190,371,498
The SIP held 1,701,272 shares at 31 December 2024.
Share options
At 31 December 2024, there were the following options outstanding across the
following schemes:
Scheme type Number at 31.12.23 Lapsed in year Exercised and issued Net settled in year Number at 31.12 24 Lapses since 31.12.24 Number at 07.04.25
2023 LTIP 2,600,000 (72,500) - - 2,527,500 (67,500) 2,460,000
2022 LTIP 3,132,500 (30,000) - 3,102,500 - 3,102,500
2021 LTIP 3,435,000 (50,000) (1,838,800) (1,546,200) - - -
EMI scheme 850,000 - (50,000) 800,000 - 800,000
IPO awards 4,372,800 - (854,800) 3,518,000 - 3,518,000
2020 awards 2,000,000 - - - 2,000,000 - 2,000,000
16,390,300 (152,500) (2,743,600) (1,546,200) 11,948,000 (67,500) 11,880,500
Earnings per share
Earnings per share are reported/calculated in accordance with IAS 33. For
non-diluted, the result after tax is divided by the average number of shares
in issue in the year. The average number of shares was 188,354,225 (FY-2023:
183,624,192).
The calculation of diluted EPS is based on the result after tax divided by the
number of actual shares in issue (above) plus Dilutive shares. Dilutive
shares are calculated on, the number of options where the fair value exceeds
the weighted average share price in the year less shares repurchased. Share
repurchased is the proceeds from exercise divided by the share price at
year-end. The fair value of options is measured using Black-Scholes and
Monte-Carlo. It should be noted that in accordance with Accounting Standards,
this calculation is based on fair value, not the difference between the market
price at the end of the year or the weighted average price and the exercise
price. The weighted average price was 118 pence (FY-2023: 99 pence), and the
number of options exceeding the fair value was 11,680,541 (FY-2023:
9,820,535).
The basic and diluted EPS are shown below:
Basic Basic Diluted Diluted
FY-2024 FY-2023 FY-2024 FY-2023
Earnings per share (in pence) 3.93 4.22 3.70 4.00
Adjusted earnings and adjusted EPS
FY-2024 FY-2023
£'000s £'000s
P&L Attributable to owners of Equals Group PLC 7,405 7,746
Add back:
- Share option charges 6,045 1,447
- Amortisation of acquired intangibles 1,611 1,672
- Exceptional items 3,636 714
- Acquisition costs - 1,377
- Tax impacts thereon* 909 183
Adjusted earnings 19,606 13,139
*Tax impacts thereon are associated to items not added back to the tax
computations relating to Exceptional items and Acquisition costs.
The resulting earnings per share are shown below:
Basic Basic Diluted Diluted
FY-2024 FY-2023 FY-2024 FY-2023
Adjusted earnings per share (in pence) 10.41 7.16 9.80 6.79
CASH STATEMENT
The movement in the cash position is shown in the table below, splitting out
trading from M&A activities:
TABLE 11: CASHFLOWS 2024 2023
£'000s £'000s
Adjusted EBITDA 28,274 20,637
Lease payments (principal and interest) (468) (929)
R&D tax credits received via Roqqett acquisition - 232
Exceptional items (3,636) (714)
Internally developed software capitalised for R&D:
- Staff (5,912) (5,653)
- IT Costs (605) (553)
Purchase of other intangible assets less disposals (261) (412)
Purchase of other non-current assets (254) (478)
17,138 12,130
Movement in working capital (699) (1,027)
'Operational Cash inflows' 16,439 11,103
Acquisition costs expensed through income statement - (1,377)
Net acquired consideration - (4,465)
Acquired Liabilities associated with acquisition (1,395) -
Earn-outs (1,028) (1,092)
Net cash proceeds in Disposal of CGU 100 280
M&A outflows (2,323) (6,654)
Funds from exercise of share options 231 97
Dividend payments (3,761) (928)
NET CASHFLOWS 10,586 3,618
Opening balance 18,662 15,044
Closing Balance 29,248 18,662
Cash per share 15.5p 10.2p
Working capital movements often comprise timing differences, the most
significant being between:
- accrued and paid affiliate commissions;
- accrued and paid performance related pay;
- accrued expenses and the settlement of
subsequent invoices;
- Profit transfers from the Client ledgers; and,
- Margin calls (or releases) from liquidity
providers.
TABLE 12 - LIQUIDITY FY-2024 FY-2023
£'000s £'000s
Cash at bank 29,248 18,662
Balances with liquidity providers 746 2,758
Pre-funded balances with card scehme provider 1,411 1,912
Gross liquid resources 31,405 23,332
Customer balances not subject to safeguarding (4,821) (4,718)
Balances due to card scheme (1,268) (811)
(6,089) (5,529)
Net position 25,316 17,803
The Group has its principal banking and deposit arrangements with Barclays
Bank PLC, NatWest, Citibank and Blackrock. As a member of RTGS, the Group
also holds interest-earning balances with the Bank of England.
Richard Cooper
Chief Financial Officer
7 April 2025
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
Note FY-2024 FY-2023
£'000s £'000s
Revenue from currency transactions 118,701 85,614
Revenue from banking transactions 8,682 8,350
Revenue from Europe transactions 4,289 1,747
Revenue 131,672 95,711
Transaction and commission costs (57,813) (43,385)
Gross Profit 73,859 52,326
Administrative expenses (55,301) (33,739)
Depreciation charge (1,161) (1,228)
Amortisation charge (7,391) (7,048)
Acquisition expenses*(1) - (1,377)
Total operating expenses (63,853) (43,392)
Memo: Adjusted EBITDA*(2) G 28,274 20,637
Operating profit A 10,006 8,934
Gain on the sale of the Cash CGU E - 380
Research & development expenditure credit 187 -
Finance cost (77) (166)
Profit before tax 10,116 9,148
Tax (charge) / credit B (2,711) (1,402)
Profit after tax 7,405 7,746
Other comprehensive income:
Exchange differences arising on translation of foreign operations (2) 6
Total comprehensive income for the year 7,403 7,752
Earnings per share C
Basic 3.93p 4.22p
Diluted 3.70p 4.00p
Notes:
Adjusted EBITDA is Operating profit or loss before: Depreciation,
Amortisation, Impairments, Share option charges, and Separately reported
items. All income and expenses arise from continuing operations.
*(1) Acquisition costs represents and includes costs pursuant to acquisitions.
*(2) Adjusted EBITDA is not a GAAP measure and represents operating profit or
loss before share option charges, depreciation, amortisation and separately
reported items (exceptional items).
CONSOLIDATED AND COMPANY STATEMENTS OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
2024 2024 2023 2023
Group Company Group Company
£'000s £'000s £'000s £'000s
ASSETS
Non-current assets
Property, plant and equipment 938 - 1,120 -
Right of use assets 2,450 - 2,881 -
Intangible assets (note E) 21,621 - 22,232 -
Goodwill 23,397 - 23,397 -
Deferred tax assets - 142 956 814
Investments - 82,935 - 77,750
48,406 83,077 50,586 78,564
Current assets
Inventories 166 - 372 -
Trade and other receivables 13,178 735 13,431 1,398
Current tax assets 365 -
Derivative financial assets (note F) 8,077 - 4,760 -
Cash and cash equivalents 29,248 6 18,662 509
51,034 741 37,225 1,907
TOTAL ASSETS 99,440 83,818 87,811 80,471
EQUITY AND LIABILITIES
Equity attributable to equity holders
Share capital 1,904 1,904 1,866 1,866
Share premium 28,720 28,720 28,498 28,498
Share-based payment reserve 5,971 3,930 5,564 3,483
Other reserves 13,544 8,118 13,556 8,128
Retained earnings 13,844 18,543 8,260 22,855
63,983 61,215 57,744 64,830
Non-current liabilities
Lease liabilities 2,191 - 2,730 -
Deferred tax liabilities 769 -
2,960 - 2,730 -
Current liabilities
Trade and other payables 25,110 22,603 22,079 15,641
Current tax liabilities - - 106 -
Lease liabilities 800 - 750 -
Derivative financial liabilities (note F) 6,587 - 4,402 -
32,497 22,603 27,337 15,641
TOTAL EQUITY AND LIABILITIES 99,440 83,818 87,811 80,471
CONSOLIDATED AND COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
Group Share capital Share premium Share- based payment (Accumulated losses) / retained earnings Other reserves Total equity
£'000 £'000 £'000 £'000 £'000 £'000
At 1 January 2023 1,807 53,405 3,231 (24,148) 8,609 42,904
Profit for the year - - - 7,746 - 7,746
Other comprehensive income:
Exchange differences arising on translation of foreign operations - - - - 6 6
Other items:
Share-based payment charge - - 1,419 - - 1,419
Share options exercised in year 3 - (333) 333 - 3
Shares issued in year 50 93 - - 143
Shares issued in relation to Roqqett acquisition 6 - - - 494 500
Dividends paid in year - - - (928) - (928)
Share premium reduction scheme - (25,000) - 25,000 - -
Share issued in relation to EMEU acquisition - - - - 3,844 3,844
Shares yet to be issued in relation to EMEU acquisition - - - - 860 860
EMEU deferred shares - non-payable - - - 50 (50) -
Transfer of Q-Money contingent liability - - - 207 (207) -
Movement in deferred tax on share-based payment reserve - - 1,247 - - 1,247
At 31 December 2023 1,866 28,498 5,564 8,260 13,556 57,744
Profit for the year - - - 7,405 - 7,405
Other comprehensive expense:
Exchange differences arising on translation of foreign operations - - - - (2) (2)
Other items:
Share-based payment charge - - 2,386 - - 2,386
Transfer of exercised and cancelled options - - (1,939) 1,939 - -
Share options exercised in year 28 222 - - - 250
Shares issued in relation to EMEU acquisition 10 - - - (10) -
Dividends paid in year - - - (3,760) - (3,760)
Movement in deferred tax on share-based payment reserve - - (40) - - (40)
At 31 December 2024 1,904 28,720 5,971 13,844 13,544 63,983
Company Share capital Share premium Share- based payment (Accumulated losses) / retained earnings Other reserves Total equity
£'000 £'000 £'000 £'000 £'000 £'000
At 1 January 2023 1,807 53,405 2,397 (89) 3,187 60,707
Loss for the year - - - (1,718) - (1,718)
Share-based payment charge - - 1,419 - - 1,419
Share options exercised in year 3 - (333) 333 - 3
Shares issued in year 50 93 - - - 143
Shares issued in relation to Roqqett acquisition 6 - - - 494 500
Dividends paid in year - - - (928) - (928)
Share premium reduction scheme - (25,000) - 25,000 - -
Acquisition of EMEU fair value increase - - - - 3,844 3,844
Acquisition of EMEU deferred consideration - - - - 860 860
EMEU deferred consideration - non-payable - - - 50 (50) -
Transfer of Q-Money contingent liability - - - 207 (207) -
At 31 December 2023 1,866 28,498 3,483 22,855 8,128 64,830
Loss for the year - - - (2,491) - (2,491)
Share-based payment charge - - 2,386 - - 2,386
Transfer of exercised and cancelled options - - (1,939) 1,939 - -
Share options exercised in year 28 222 - - - 250
Shares issued in relation to EMEU acquisition 10 - - - (10) -
Dividends paid in year - - - (3,760) - (3,760)
At 31 December 2024 1,904 28,720 3,930 18,543 8,118 61,215
The following describes the nature and purpose of each reserve within owners'
equity:
Share capital
Amount subscribed for shares at nominal value.
Share
premium
Amount subscribed for shares in excess of nominal value, less directly
attributable costs.
Share-based payment reserve Proportion of the fair
value of share options granted relating to services rendered up to the balance
sheet date.
Retained earnings / (accumulated losses) Cumulative profit and
losses attributable to equity shareholders.
Other reserves comprise:
Merger
reserve Arising
on equity settled consideration on acquisition of subsidiaries.
Contingent consideration reserve Arising on equity based
contingent consideration on acquisition of subsidiaries.
Foreign currency reserve Arising on
translation of foreign operation.
CONSOLIDATED STATEMENT OF CASHFLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
FY-2024 FY-2024 FY-2023 FY-2023
Group Company Group Company
£'000s £'000s £'000s £'000s
Profit / (Loss) before tax 10,116 (3,818) 9,148 (2,666)
Add: Cashflows from operating activities:
Adjustments for:
Depreciation 1,160 - 1,228 -
Amortisation 7,391 - 7,048 -
Share-based payment charges 2,386 - 1,419 -
Other non-cash items (96) - - -
Decrease / (increase) in trade and other receivables*(1) 253 664 (6,415) 1,867
Increase / (decrease) in trade and other payables*(2) 2,283 6,961 (386) 3,604
(Increase) / decrease in derivative financial assets (3,317) - 856 -
Increase / (decrease) in derivative financial liabilities 2,185 - (387) -
Decrease / (increase) in inventories 206 - (80) -
Finance costs 77 - 167 8
12,528 7,625 3,449 5,479
Net cash inflow 22,644 3,807 12,597 2,813
Tax receipts - - 232 -
Tax paid (561) - (345) -
NET CASHFLOWS FROM OPERATING ACTIVITIES 22,083 3,807 12,484 2,813
Cashflows from investing activities
Acquisition of property plant and equipment (268) - (479) -
Acquisition of intangibles (6,780) - (6,618) -
Acquisition of subsidiary, net of cash acquired - - - (2,976)
Additional investment in subsidiaries - (2,799) - -
Dividend income - 2,000 - 1,500
Net cash used in investing activities (7,048) (799) (7,097) (1,476)
Cashflows from financing activities
Principal elements of lease payments (789) - (786) -
Interest paid on finance lease (149) - (155) -
Dividends paid (3,761) (3,761) (928) (928)
Proceeds from issuance of ordinary shares 250 250 100 100
Net cash outflow from financing activities (4,449) (3,511) (1,769) (828)
NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS 10,586 (503) 3,618 509
Cash, and cash equivalents at 1 January 18,662 509 15,044 -
Cash, and cash equivalent at 31 December 29,248 6 18,662 509
*(1) The movement in the deferred and current tax assets and the right-of-use
asset balances (excluding the depreciation charge) is included within the
movement in trade and other receivables.
*(2) The movement in the deferred and current tax liabilities and the lease
liability balances is included within the movement in trade and other
payables.
ABBREVIATED NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
A - OPERATING PROFIT IS STATED AFTER CHARGING:
FY-2024 FY-2023
£'000s £'000s
Staff costs:
Commissions 6,062 4,141
Other pay and benefit elements 31,753 22,411
Training and recruitment 869 1,114
Vehicle leasing costs 176 160
Contractors 3,266 2,398
Costs gross of exceptional items 42,126 30,224
Less: incorporated in Transaction and commission costs (6,062) (4,141)
Less: amounts capitalised (5,912) (5,653)
Less: IFRS 16 (176) (160)
Included in administrative expenses 29,976 20,270
IT, and telephone costs 6,364 3,859
Less: amounts capitalised (605) (553)
Included in administrative expenses 5,759 3,306
Professional and compliance fees
Fees incurred on capital restructuring of the Company* - 58
Fees incurred on the strategic review* 2,225 656
Statutory audit costs 747 493
Other professional and compliance fees 4,193 3,175
Included in administrative expenses 7,165 4,382
Property costs
Rents 1,010 790
Other property costs 1,207 1,067
2,217 1,857
Less: IFRS 16 (753) (697)
Included in administrative expenses 1,464 1,160
Travel and subsistence 846 633
Marketing 4,023 2,565
Other costs, including SIP and LTIP PAYE/NI 3,649 117
Included in administrative expenses 8,518 3,315
Sub-total, cash based expenditure 52,882 32,433
Share option charge 2,386 1,419
Foreign exchange loss 33 346
Contingent consideration charge - (459)
Sub-total, non-cash based costs 2,419 1,306
Total, administrative expenses 55,301 33,739
Add:
Depreciation - right to use assets 711 692
Depreciation - property, plant, equipment 450 536
Amortisation charge (see table 5) 7,391 7,048
Acquisition costs - 1,377
TOTAL OPERATING EXPENSES 63,853 43,392
*recorded as separately reported items.
B. TAXATION
The Group's taxation charge or credit is the composite of:
1. Corporation tax charge arising on profits in the financial year,
2. Deferred taxation arising on temporary and permanent timing differences
and losses carried forward, to the extent that the Company believes these to
be recoverable from future taxable profits.
FY-2024 FY-2023
£'000s £'000s
Corporation tax charge* 1,109 259
Adjustment in respect of prior year corporation tax (83) -
Current tax charge 1,026 259
Origination and reversal of temporary differences 407 534
Remeasurement of deferred tax asset on carry forward tax losses - current year 1,556 844
Deferred tax - prior year adjustment (278) (235)
Deferred tax charge 1,685 1,143
Total tax charge 2,711 1,402
*Corporation tax charge is paid under quarterly instalments, £441k has been
paid up to 31 December 2024.
As at 31 December 2024, the Group had tax losses available to be offset
against future taxable profits of £4,371k (FY-2023: £12,384k). The losses
can be carried forward indefinitely and have no expiry date.
In addition to corporation tax, the Group paid £5,341k in taxation during the
year as follows:
a. Employers National Insurance contributions - £3,698k (FY-2023: £2,683k),
b. irrecoverable VAT - £3,187k (FY-2023: £2,658k)
Factors affecting tax credit for the year
The credit for the year can be reconciled to the loss per the consolidated
statement of comprehensive income as follows:
FY-2024 FY-2023
£'000s £'000s
Profit before taxation: continuing operations 10,116 9,148
Taxation at the UK corporation rate tax of 25% (2023: 23.5%) 2,529 2,150
Net permanent differences between tax and accounting 566 190
Adjustment in respect of prior year corporation tax (83) -
Net taxation impact of R&D tax credit claim - (897)
Remeasure of deferred tax asset on carry-forward losses -current year 1,556 844
Remeasure of deferred tax asset on carry forward losses - prior year (278) (235)
Effect of change in tax rates - 194
Utilisation of tax losses for which no deferred tax asset was recognised (23) -
Utilisation of tax losses (1,556) (844)
2,711 1,402
C. EARNINGS PER SHARE
Basic earnings per share
The calculation of basic earnings per share has been based on the profit
attributable to ordinary shareholders and weighted average number of ordinary
shares outstanding. The profit after tax attributable to ordinary shareholders
of the Group is £7,405k (2023: £7,746k) and the weighted average number of
shares for the period was 188,354,225 (2023: 183,624,192).
Diluted earnings per share
The calculation of diluted earnings per share has been based on the profit
attributable to ordinary shareholders and weighted average number of ordinary
shares outstanding, after adjustment for the effects of all dilutive potential
ordinary shares. The weighted average number of dilutive shares is
200,034,765 (2023: 193,444,728).
Basic Diluted Basic Diluted
FY-2024 FY-2024 FY-2023 FY-2023
Earnings per share 3.93p 3.70p 4.22p 4.00p
Adjusted earnings per share (note D) 10.41p 9.80p 7.16p 6.79p
D. ADJUSTED EARNINGS PER SHARE
The calculation of adjusted earnings per share has been based on the analyst
community calculations, which takes profit or loss attributable to ordinary
shareholders and excludes share option charges, amortisation on acquired
intangibles, exceptional items, acquisition costs and tax on these items, and
weighted average number of ordinary shares. The adjusted earnings after tax
to ordinary shareholders of the Group is £19,606k (FY-2023: £13,139k) and
the weighted average number of shares and diluted shares are as above.
E. INTANGIBLE ASSETS OTHER THAN GOODWILL
Intangible assets comprise:
Intangible assets recognised through acquisitions Intangible assets acquired through internal capitalisation Other intangible assets Total, 31 December 2024 Total, 31 December 2023
All in £'000s
Cost at 31.12.2023 15,074 32,207 2,530 49,811 49,811
Additions in year - 6,518 262 6,780
Cost at 31.12.2024 15,074 38,725 2,792 56,591
Amortisation at 31.12.2023 (7,500) (18,406) (1,673) (27,579) (27,579)
Amortisation in the year (1,611) (5,361) (419) (7,391)
Amortisation at 31.12.2024 (9,111) (23,767) (2,092) (34,970)
Net Book Value at 31.12.2024 5,963 14,958 700 21,621
Net book value at 31.12.2023 7,574 13,801 857 22,232
F. DERIVATIVE FINANCIAL ASSETS AND LIABILITIES
The Group does not take house positions on foreign exchange contracts. Each
contract with a customer is contemporaneously booked with a bank or liquidity
provider. Under accounting standards however, the contracts need to be valued
as both a 'purchase' and a 'sale'. The valuation of these contracts is done
by a third party using information sourced from Hedgebook.
G. RECONCILIATION FROM OPERATING PROFT TO ADJUSTED EBITDA
FY-2024 FY-2023
£'000s £'000s
10,006
Operating profit 8,934
Add back:
Depreciation 1,161 1,228
Amortisation 7,391 7,048
Acquisition expenses - 1,377
Separately reported items 3,638 714
FX differences 33 346
Share Option charges 2,386 1,419
Other Share Option charges 3,659 30
Contingent Consideration - (459)
Adjusted EBITDA 28,274 20,637
- ENDS -
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