REG - Fiske PLC - Interim results
02/03/2023 07:01
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RNS Number : 5852R Fiske PLC 02 March 2023
02 March 2023
FISKE PLC
("Fiske" or the "Company" or the "Group")
Interim results
Fiske (AIM:FKE (AIM%3AFKE) ) is pleased to announce its interim results for
the six months ended 31 December 2022.
In accordance with rule 26 of the AIM Rules for Companies this information is
also available, under the Investors section, at the Company's website,
http://www.fiskeplc.com .
For further information, please contact:
Fiske PLC
James Harrison (CEO) Tel: +44 (0) 20 7448 4700
100 Wood Street
London
EC2V 7AN
Grant Thornton UK LLP (Nominated Adviser) Tel: +44 (0) 20 7383 5100
Samantha Harrison / Harrison Clarke / Samuel Littler
Trading
Across the half year to December 2022 UK markets were broadly level, although
there was a material dip in October. Meanwhile, across the world, different
markets had separate distinctive profiles in the period. With Fiske's client
assets invested internationally, assets under management and thus management
fees were broadly level; slightly down versus the prior reported interims (to
November 2021) but slightly up on the immediately preceding six months to 30
June 2022.
In contrast, commission revenues were some 15% lower than the prior reported
interims (to November 2021) and also lower than the immediately preceding six
months to 30 June 2022. We believe that this recent pattern reflects the
apparent turmoil in the world, with sentiment highly tuned to expectations
around interest rate movements.
In a period of double-digit inflation, operating expenses have increased by
some 4% over the immediately preceding six months to June 30, but are down
almost 10% on the prior reported interims (to November 2021) when we had the
expenses associated with our relocation to new offices at 100 Wood Street and
restructuring costs incurred in anticipation of a smaller office footprint.
As expected, we now benefit from the reduction in overall property costs.
Overall, the profit before tax for the half year to 31 December 2022 was
£28,000 compared to a loss of £6,000 in the half year to November 2021.
Our cash balances remain strong, at £3.1m.
Recent results from Euroclear showed further improvement in the company's
operating businesses. Sales of shares by other shareholders have taken place
at modestly lower levels than when last notified. Accordingly, we have
adjusted our holding value down to this lower level. The company also guided
shareholders that it expects to increase its dividend, payable in October
2023, by some 31%.
Significant regulatory change in the form of the Consumer Duty is due for
implementation in 2023. Considerable time and effort is being spent
evaluating how the new rules should be implemented across our business and
client base. As guided by the Financial Conduct Authority we have appointed
a Consumer Duty Champion at Board level to oversee the implementation of these
new regulations.
Markets
Over the past six months market leadership has shifted dramatically away from
highly valued US technology growth stocks and pandemic beneficiaries towards
higher yielding value situations found in the "old economy" sectors that are
so predominant in the UK equity market. The relatively low ratings of many
of the UK's major companies are attracting the interest of activist
investors. As a result, the US and UK markets have become disconnected with
the latter moving ahead whilst the US market and the NASDAQ market are
falling. Whilst not necessarily a long-term trend this adjustment may have
further to go.
The two major factors affecting stock markets at present are the European war
between Russia and Ukraine and the high level of inflation. It would appear
that neither is about to be solved favourably in the short term. The Russian
invasion of Ukraine and in the background the threatening behaviour of China
towards Taiwan have at last so disturbed the very complacent Western powers
that the geo-political scene for at least the next decade will be totally
changed.
Defence expenditure, for so long a declining priority amongst Western but
especially European powers, has re-emerged as an urgent priority. At the
same time inflation which has been quiescent for two decades has been
rekindled partly by the changed world political scene but more because it had
never gone away but rather lain dormant and consequently ignored. Commodity
prices, especially that of oil and gas, have always been volatile but what we
have seen in the past decade looks more like a major readjustment and as such
will be of economic significance for many years to come. The idea that
inflation in the West will return to a maximum of 2% within the current
calendar year is naïve if not irresponsible and seems like the wish
fulfilment of the Wall Street bulls rather than a considered economic
forecast.
Outlook
History tells us that markets will eventually be calmer and meanwhile it is
our role to focus on delivering the best investment strategies to protect and
grow our client's assets. Since December 2022, we have executed an overhaul of
our fee tariffs and are legislating for this to increase our income; a
much-needed implementation given the ever-increasing costs, especially those
pertaining to regulations and compliance.
Clive Fiske Harrison
James P Q Harrison
Chairman
Chief Executive Officer
02 March 2023
Condensed Consolidated Statement of Total Comprehensive Income
For the six months ended 31 December 2022
6 months ended 6 months ended 13 months ended
31 December 2022 30 November 2021 30 June 2022
note Unaudited Unaudited Audited
£'000 £'000 £'000
Revenues 2 2,604 2,856 5,764
Operating expenses (2,762) (3,035) (6,269)
Operating (loss)/profit (158) (179) (505)
Investment revenue 200 183 185
Finance costs (14) (10) (29)
Profit/(loss) on ordinary activities before taxation 28 (6) (349)
Taxation credit/(charge) - - 177
Profit/(loss) on ordinary activities after taxation 28 (6) (172)
Other comprehensive income/(expense)
Items that may subsequently be reclassified to profit or loss
Movement in unrealised appreciation of investments (192) (35) 1,017
Deferred tax on movement in unrealised appreciation of investments 3 48 (162)
(443)
Net other comprehensive income/(expense) (144) (197) 574
Total comprehensive income/(loss) for the period/year attributable to equity (116) (203) 402
shareholders
Profit/(loss) Earnings per ordinary share (pence) 4
Basic 0.2p (0.1)p (1.5)p
Diluted 0.2p (0.1)p (1.5)p
All results are from continuing operations and are attributable to equity
shareholders of the parent Company.
Condensed Consolidated Statement of Financial Position
31 December 2022
As at As at As at
31 December 2022 30 November 2021 30 June 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Non-current assets
Intangible assets arising on consolidation 830 1,050 911
Other intangible assets - 16 -
Right-of-use assets 203 304 250
Property, plant and equipment 18 30 21
Investments held at Fair Value Through Other Comprehensive Income 4,429 3,568 4,621
Total non-current assets 5,480 4,968 5,803
Current assets
Trade and other receivables 2,417 2,797 2,450
Cash and cash equivalents 3,051 3,620 3,248
Total current assets 5,468 6,417 5,698
Current liabilities
Trade and other payables 1,801 2,647 2,147
Short-term lease liabilities 106 - 106
Current tax liabilities - 43 -
Total current liabilities 1,907 2,690 2,253
Net current assets 3,561 3,727 3,445
Non-current liabilities
Long-term lease liabilities 111 308 155
Deferred tax liabilities 785 735 833
Total non-current liabilities 896 1,043 988
Net assets 8,145 7,652 8,260
Equity
Share capital 2,957 2,957 2,957
Share premium 2,085 2,085 2,085
Revaluation reserve 2,984 2,356 3,128
Retained earnings 119 254 90
Shareholders' equity 8,145 7,652 8,260
Condensed Consolidated Statement of Changes in Equity
For the six months ended 31 December 2022
Share Capital Share Premium Revaluation Reserve Retained Earnings Total Equity
£'000 £'000 £'000 £'000 £'000
Balance at 1 July 2022 2,957 2,085 3,128 90 8,260
Profit on ordinary activities after taxation - - - 28 28
Movement in unrealised appreciation of investments - - (192) - (192)
Deferred tax on movement in unrealised appreciation of investments - - 48 - 48
Total comprehensive income / (expense) for the period - - (144) 28 (116)
- - - 1 1
Share based payment transactions
Total transactions with owners, recognised directly in equity - - - 1 1
Balance at 31 December 2022 2,957 2,085 2,984 119 8,145
Balance at 31 May 2021 2,939 2,082 2,553 562 8,136
Adjustments - - - (303) (303)
Balance at 31 May 2020 as restated 2,939 2,082 2,553 259 7,833
(Loss) on ordinary activities after taxation - - - (6) (6)
Movement in unrealised appreciation of investments - - (35) - (35)
Deferred tax on movement in unrealised appreciation of investments - - (162) - (162)
Total comprehensive income / (expense) for the period - - (197) (6) (203)
- - - 1 1
Share based payment transactions
Issue of ordinary share capital 18 3 - - 21
Total transactions with owners, recognised directly in equity 18 3 - 1 22
Balance at 30 November 2021 2,957 2,085 2,356 254 7,652
Balance at 1 June 2021 2,939 2,082 2,553 259 7,833
(Loss) on ordinary activities after taxation - - - (172) (172)
Movement in unrealised appreciation of investments - - 1,017 - 1,017
Deferred tax on movement in unrealised appreciation of investments - - (443) - (443)
Realised disposal of Fair Value through OCI - - 1 - 1
Total comprehensive income / (expense) for the period - - 575 (172) 403
- - - 3 3
Share based payment transactions
Issue of ordinary share capital 18 3 - - 21
Total transactions with owners, recognised directly in equity 18 3 - 3 24
Balance at 30 June 2022 2,957 2,085 3,128 90 8,260
Condensed Consolidated Statement of Cash Flows
For the six months ended 31 December 2022
6 months ended 6 months ended 13 months ended
31 December 2022 30 November 2021 30 June 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Operating (loss)/profit (158) (179) (505)
Amortisation of intangible assets arising on consolidation 81 80 218
Amortisation of other intangible assets - 16 32
Depreciation of right-of-use assets 47 23 79
Depreciation of property, plant and equipment 6 15 31
Expenses settled by the issue of shares 1 1 3
Decrease/(increase) in receivables 683 (305) 248
(Decrease)/increase in payables (996) 317 (389)
Cash generated (used in)/from operations (336) (32) (283)
Tax recovered / (paid) - - (49)
Net cash (used in)/generated from operating activities (336) (32) (332)
Investing activities
Investment income received 200 183 185
Interest received - - -
Purchases of property, plant and equipment (3) (21) (28)
Purchases of other intangible assets - - -
Net cash (used in)/ generated from investing activities 197 162 157
Financing activities
Interest paid (14) (10) (29)
Proceeds from issue of ordinary share capital - 22 22
Repayment of lease liabilities (44) (20) (68)
Net cash used in financing activities (58) (8) (75)
Net (decrease) / increase in cash and cash equivalents (197) 122 (250)
Cash and cash equivalents at beginning of period 3,248 3,498 3,498
Cash and cash equivalents at end of period/year 3,051 3,620 3,248
Notes to the Interim Financial Statements
1. Basis of preparation
The Condensed Consolidated Interim Financial Statements of Fiske plc and its
subsidiaries (the Group) for the six months ended 31 December 2022 have been
prepared in accordance with IAS 34 (Interim Financial Reporting), as adopted
in the United Kingdom. The accounting policies applied are consistent with
those set out in the June 2022 Fiske plc Annual Report and accounts. These
Condensed Consolidated Interim Financial Statements do not include all the
information required for full annual statements and should be read in
conjunction with the June 2022 Annual Report and Accounts.
The Financial Statements of the Group for the 13-month period ended 30 June
2022 were prepared in accordance with International Financial Reporting
Standards adopted by in the United Kingdom. The statutory Consolidated
Financial Statements for Fiske plc in respect of the 13-month period ended 30
June 2022 have been reported on by the Company's auditor and delivered to the
registrar of companies. The report of the auditor was (i) unqualified, (ii)
did not include a reference to any matters to which the auditor drew attention
by way of emphasis without qualifying their report, and (iii) did not contain
a statement under Section 498 (2) or (3) of the Companies Act 2006.
Under IAS 27 these financial statements are prepared on a consolidated basis
where the Group consists of Fiske plc, the parent, and those subsidiaries in
which it owns 100% of the voting rights, being Ionian Group Limited, Fiske
Nominees Limited, Fieldings Investment Management Limited and VOR Financial
Strategy Limited.
The directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable future.
Thus, they continue to adopt the going concern basis of accounting in
preparing this half-yearly financial report.
There were no new mandatory standards or amendments to existing standards
effective in the six-month reporting period to 31 December 2022.
2. Revenues
IFRS 8 requires operating segments to be identified on the basis of internal
reports about components of the Group that are regularly reviewed by
management to allocate resources to the segments and to assess their
performance. Following the acquisition of Fieldings Investment Management
Limited in August 2017, their staff and operations have been integrated into
the management team of Fiske plc. Pursuant to this, the Group continues to
identify a single reportable segment, being UK-based financial intermediation.
Within this single reportable segment, total revenue comprises:
6 months ended 6 months ended 13 months ended
31 December 2022 30 November 2021 30 June 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Commission receivable 1,087 1,276 2,576
Investment management fees 1,495 1,578 3,186
2,582 2,854 5,762
Other income 22 2 2
2,604 2,856 5,764
3. Deferred tax
Deferred tax assets and liabilities are recognised at a rate which is
substantively enacted at the balance sheet date. The rate to be taken in this
case is 25%, (13 months to June 2022: 25%) being the anticipated rate of
taxation applicable to the Group and Company in the following year.
4. Earnings per share
Diluted
Basic Basic
£'000 £'000
Profit on ordinary activities after taxation 28 28
Adjustment to reflect impact of dilutive share options - -
Profit 28 28
Weighted average number of shares (000's) 11,830 11,830
Profit per share (pence) 0.2p 0.2p
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