REG - Frenkel Topping Grp - Final Results
24/04/2023 07:15
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RNS Number : 1371X Frenkel Topping Group PLC 24 April 2023
Frenkel Topping Group plc
("Frenkel Topping", "the Company" or the "Group")
Results for the 12 months ended 31 December 2022
A year of executing strategy and delivering a strong performance
Frenkel Topping Group (AIM: FEN), a specialist professional and financial
services firm operating in the Personal Injury (PI) Clinical Negligence (CN)
space, is pleased to announce its final results for the 12 months ended 31
December 2022. These results demonstrate a strong performance through 2022
and the Board is pleased to report an encouraging start to the 2023 financial
year in line with management's expectations.
Financial Highlights
FY 2022 FY 2021 % change
Revenue £24.8m £18.4m +35%
Recurring revenue £11.0m £8.9m +24%
Gross profit £11.1m £9.0m +23%
Adjusted EBITDA £6.1m £4.6m +33%
Underlying profit from operations £5.5m £4.3m +28%
Total dividends (paid and proposed) 1.37p per share 1.36p per share +1%
Total assets £53.1m £37.8m +40%
Operational Highlights
· Fourteenth consecutive year of high client retention (99%) for
investment management services
· Assets under management ("AUM") up 1% to £1,187m (as at 31
December 2021: £1,174m)
· Ascencia - Assets on a discretionary mandate up 6% to £715m (as at
31 December 2021: £676m)
o Net Growth in Ascencia demonstrating the resilience of the inhouse DFM
Funds in a turbulent market
· Acquisition of Cardinal Management Limited ("Cardinal"), Somek
& Associates Limited ("Somek") and N-Able Services Limited ("N-Able")
completed during the year
· Continued successful execution of our acquisition and consolidation
strategy in the PI and CN space, diversifying our revenue streams
· Additional working-in-partnership agreement signed with CFG Law
A strong start to the new financial year
· Continued integration of acquisitions made to date
· First three months of trading has been robust and is in line with
management expectations
· Additional working-in-partnership agreements signed with Serious
Injury Law
· The Executive and Management team are focused on the next stage of
growth and the drive to double market share and target doubling of revenue
over the next five years
Richard Fraser, CEO of Frenkel Topping, said:
"Our 2022 results demonstrate our focused approach to delivering on our
acquisition strategy, along with the organic growth of our enlarged Group, in
order to deliver the best possible outcomes for our clients, both professional
and individuals.
We are continuing to develop a market-leading suite of services from which to
offer greater breadth of support to people who have suffered significant and
often life changing injuries. Our impressive client retention rate reflects
our clients' trust and confidence in us to manage their money conservatively.
We are particularly proud of the performance of the Group's discretionary fund
manager, Ascencia Investment Management ("Ascencia"), where assets on a DFM
Mandate increased to £715m (2021: £676m).
Comparing Ascencia's positive performance against a backdrop of wider market
contraction and material outflows further demonstrates Ascencia's success in
managing multi-asset investment solutions that are positioned to capture the
upside of market fluctuations, while aiming to reduce the negative impact of
market turbulence on client assets.
Ascencia's strong performance in the previous financial year continued last
year, with the core risk-rated strategies outperforming their respective
Private Client Indices/ARC indices. It is testament to the Group's in-house
strategy and approach to risk management. The Company views the Ascencia
platform as a clear growth opportunity in the coming years and a key tool to
winning future business. Ascencia portfolios are currently defensively
positioned given the uncertain and opaque investment outlook, with cash ready
to be deployed should the opportunity arise.
We would like to take this opportunity to thank the staff, both longstanding
and those that have joined during our acquisition journey, for their
commitment and dedication to our clients enabling us to achieve these results.
The current financial year has begun robustly giving cause for optimism for
the remainder of the year.
The Board remain focused on delivering value for all stakeholders and are
happy to report that the Group is trading in line with management's
expectations."
Elaine Cullen-Grant, CFO of Frenkel Topping said:
"Despite a challenging market, we delivered a strong set of financial results,
in no small part a reflection of our delivery against a focused acquisition
strategy resulting in diversified revenue streams. This coupled with control
on costs has meant we were able to maintain our adjusted EBITDA margin at 25%
and mitigate the slight reduction in recurring revenue.
We are well positioned to continue to grow the business in the year ahead and
are pleased with the 2023 performance to date"
For further information:
Frenkel Topping Group plc www.frenkeltoppinggroup.co.uk (http://www.frenkeltoppinggroup.co.uk/)
Richard Fraser, Chief Executive Officer Tel: 0161 886 8000
finnCap Ltd (Nominated Advisor & Broker) Tel: 020 7220 0500
Carl Holmes/Abigail Kelly/Milesh Hindocha (Corporate Finance)
Tim Redfern / Charlotte Sutcliffe (ECM)
About Frenkel Topping Group
The Frenkel Topping Group of companies specialises in providing financial
advice and asset protection services to clients at times of financial
vulnerability, with particular expertise in the field of personal injury (PI)
and clinical negligence (CN).
For more than 30 years the Group has worked with legal professionals and
injured clients themselves to provide pre-settlement, at-settlement and
post-settlement services to help achieve the best long-term outcomes for
clients after injury. It boasts a client retention rate of 99%.
Frenkel Topping Group is focused on consolidating the fragmented PI and CN
space in order to provide the most comprehensive suite of services to clients
and deliver a best-in-class service offering from immediately after injury or
illness and for the rest of their lives.
The group's services include the Major Trauma Signposting Partnership service
inside NHS Major Trauma Centres, expert witness, costs, tax and forensic
accountancy, independent financial advice, investment management, and care and
case management.
The Group's discretionary fund manager, Ascencia, manages financial
portfolios for clients in unique circumstances, often who have received a
financial settlement after litigation. In recent years Ascencia has
diversified its portfolios to include a Sharia-law-compliant portfolio and a
number of ESG portfolios in response to increased interest in socially
responsible investing (SRI).
Frenkel Topping has earned a reputation for commercial astuteness underpinned
by a strong moral obligation to its clients, employees and wider society, with
a continued focus on its Environmental, Social and Governance (ESG) impact.
For more information visit: www.frenkeltoppinggroup.co.uk
(https://protect-eu.mimecast.com/s/WNCMCR1EKSxDwoTNKWD-?domain=frenkeltoppinggroup.co.uk)
Chairman's Statement
Overview
On behalf of the Frenkel Topping Group (FTG) Board of Directors, I am pleased
to report on another positive year of growth for the Group in which we
continued to deliver strong results for our shareholders.
The Group's performance in the last financial year demonstrates the company's
resilience in a challenging financial market, as well as further progress made
by the Group through its focused acquisition strategy and continued
consolidation of the Personal Injury (PI) and Clinical Negligence (CN) space.
FTG is a unique group of businesses operating in a niche sector and its
continued growth despite challenging market conditions shows how well
positioned its service offering and reputation is in the marketplace. The
Group demonstrated the power of diversifying revenue streams, which tempered
the impact of the challenging capital markets, while the performance of the
Group's discretionary fund manager, Ascencia Investment Management
("Ascencia") continues to be a credit to the firm.
FTG's work for both claimants and defendants makes it a stand out provider of
expert witness reports. Its unique business model, offering multiple services
and touch points from the very start of a case at the 'index event' and
throughout the claimant lifecycle, means one of its key revenue streams
(expert witness services) is also a key business development pipeline.
The Group's expansion by acquisition into complementary areas continues to be
very well received and the last year has seen the Group make excellent
progress in developing new business while continuing to grow existing
relationships.
Following the fundraises in July 2020 and July 2022, FTG has capitalised on
the opportunity to consolidate a highly fragmented area of professional
services. FTG has executed a buy-and-build strategy bringing complementary
services into the Group, creating multiple touch points in the PI and CN space
providing the opportunity to grow Assets Under Management and delivering
recurring revenues.
In 2022 the Group has completed three further acquisitions of Cardinal, Somek
and Associates Ltd and N-Able Services Ltd. The three additions to the family
of businesses have integrated incredibly well both operationally and
culturally. The fundraise during the year has also allowed the group to gain
further momentum and enact a number of key investments that will drive further
operational efficiencies, maintain client retention rates and future-proof the
business through developing in areas including technology, talent and the
client journey. We are grateful for the support shown by both existing and new
investors in supporting our growth strategy.
These important, successful developments are outlined in further detail in the
Chief Executive Officer's Statement and the Strategic Report. In addition,
we are very proud of the firm's longstanding client retention rate which has
been maintained at 99%, a fourteenth consecutive year of excellent
performance.
Finally, on behalf of the Board I would like to thank all FTG employees for
their dedication and hard work.
Dividend
Total dividends (paid and proposed) for the year are 1.37p per share (FY 2021:
1.36p). This is a reflection of the board's intention to continue to invest in
the future of the business.
Outlook
The current financial year has started well and the Board is confident that
the acquisitions made to date will continue to contribute revenue and
profitable growth to the Group. Expectations for FY2023 therefore remain
unchanged as a result of the solid start to the financial year.
Chief Executive Officer's Statement
I am very pleased to report on another strong 12-month period that has seen
the group move into the next stage of its strategy, integrating the companies
we have acquired, harnessing the strength of our shared services and
maximising commercial opportunities within a larger client pool. We are
developing an extensive service offering under the Frenkel Topping Group name
which is held in high regard in the PI and CN space and can act as single
destination, providing an end-to-end service for lawyers, consultants and
claimants involved in PI and CN cases both pre and post settlement.
We have continued to execute on the buy and build strategy outlined ahead of
our capital raise in 2020 and we are in a strong position to accelerate growth
through the Group in the coming years, capitalising on the significant
opportunity in the PI and CN sector. I am incredibly proud of the team's
efforts and I look forward to seeing the positive impact of the key
investments we are making following our more recent fundraise in July 2022.
These acquisitions have served to diversify our revenue streams, which has
been especially important in the year given the backdrop of market volatility.
Additionally, of note during the year is the performance of the Group's
discretionary fund manager (DFM), Ascencia Investment Management, where assets
on a DFM mandate increased to £715m (2021: £676m). Comparing Ascencia's
positive performance against a backdrop of wider market contraction further
demonstrates Ascencia's success in managing multi-asset investment solutions
that are positioned to capture the upside of market fluctuations, while aiming
to reduce the negative impact of market turbulence on client assets.
Ascencia has performed strongly in recent periods and in the year under
review, with the core risk-rated strategies outperforming their respective
Private Client Indices/ARC indices. It is testament to the Group's in-house
strategy and approach to risk management and something the Board is
justifiably proud of.
We see our Ascencia platform as a clear growth opportunity in the coming years
and a key tool to winning future business. Ascencia portfolios are currently
defensively positioned given the uncertain and opaque investment outlook, with
cash ready to be deployed should the opportunity arise.
The Group continued to make significant progress delivering against its
acquisition strategy to consolidate the pre-settlement professional services
marketplace in the PI and CN space, positioning Frenkel Topping as a market
leader in its sector.
Across the Group, we support litigators pre-settlement in achieving
appropriate damages for their clients, by providing expert witness services.
Post-settlement, we support clients in achieving the best long-term financial
outcomes after injury, meaning FTG provides a true end-to-end service.
I now want to give some more information on the three acquisitions we made in
the year.
Cardinal Management Ltd
We started 2022 with our most impactful deal to date in January with the
acquisition of Cardinal Management Ltd.
Cardinal works in close partnership with a number of key NHS Major Trauma
Centres to provide a Major Trauma Signposting Partnership support service.
It is the sole commercial organisation operating in its space and has a
six-year track record of contracts with the NHS with a 100% contract renewal
rate.
The acquisition of Cardinal provides a clear and direct link to claimants and
their professional representatives, at the earliest stage possible after
injury or illness, introducing the portfolio of FTG services in a relevant and
timely way to its clients in the PI and CN litigation space as well as
claimants themselves.
Cardinal is performing to plan, as successful claims and cases come to
settlement, driving growth in AUM.
Somek and Associates Ltd
Somek has been operating since 1997 and is one of the largest providers of
Expert Witnesses in the UK, delivering highly professional trained experts in
a range of health professions. As a trusted source of Expert Witnesses, Somek
has a balanced portfolio with instructions from claimants and defendants and
has experts with specialist experience in a range of clinical fields based
throughout the UK.
The addition of Somek to the Group's existing Expert Witness professional
service offering transforms FTG into a market leader in this space.
N-Able Services Ltd
N-Able is a professional service firm, founded in 2002 in response to the
growing demand for bespoke, specialist Case Management services to support
those who had experienced catastrophic injuries. N-Able is now one of the
largest independent Case Management providers in the UK. N-Able works directly
with many of the UK's leading law and insurance firms to guide and support
clients through the rehabilitation and litigation process and beyond, enabling
clients to maximise their independence and live life to their fullest.
The Board believes that N-Able's presence in Case Management in regional areas
where the Group does not currently operate will bolster the Group's existing
Keystone Case Management business significantly and provides a platform for
growth.
Care and Case Management is a core part of the client journey in PI and CN and
the ability to provide those services within FTG strengthens our position as
an end-to-end provider in the marketspace. These specific areas are well
covered by the addition of N-Able and Somek, increasing our touchpoints on
the journey of a potential claimant and allowing the Group to apply the same
high standards consistently throughout the client journey.
The trust and respect we have earned, the relationships we have nurtured and
the results we have achieved across all our Group brands over many years can
only be matched by high calibre businesses such as these two firms. The
addition of Somek and N-Able enhance the Group's position as a flagship firm
in its field.
Strategy in Action
2022 saw the further enactment of the strategy that was outlined in 2020 of
consolidating the PI and CN space. By acquiring a number of highly
complementary businesses that have contributed to the financial performance of
the Group, we have increased visibility and significantly enhanced our
touchpoints within the space, we have developed a market-leading platform from
which to offer a greater breadth of services to people who have suffered
significant and often life-changing injuries and to their professional
representatives.
By focusing on the consolidation of professional services in a very niche
sector, we have developed greater access to clients - both directly to the
injured party and via their legal representatives - and extended the
customisation of their care. Frenkel Topping Group now delivers an end-to-end
service to its client base under a tried and trusted umbrella group, making us
a leading operator in our field..
In January 2023, subsidiaries Forth Associates and Bidwell Henderson Cost
Consultants (BH) both delivered record revenues and BH surpassed its previous
highest recorded number of files received by 20% - some examples of how the
businesses are stronger together.
We are driven by our ambition to provide a full, end-to-end service in the
personal injury and clinical negligence space because we are confident that we
can deliver the very best service levels to clients from immediately after
injury or illness and for the rest of their lives.
The most recent acquisitions are in line with the Board's strategy of
expanding the Group's activities in Care & Case management as set out at
the time of the Group's July 2022 fundraising. In addition, the acquisition
of N-Able adds regional reach in Case Management, helping drive further growth
in this sector.
Revenue for the year increased by 35% to £24.8m (2021: £18.4m), within which
recurring revenue has grown by 24% to £11.0m (2021: £8.9m).
Gross profit was up to £11.1m (2021: £9.0m) and underlying profit from
operations (as defined in our Accounting Policies on page 45) was £5.5m
(2021: £4.3m), an increase of 31%. The Group is in a robust financial
position, with total assets of £53.1m (2021 £37.8m) and as at 31 December
2022, net cash remained strong at £5.0m (2021 £8.6m). Following the year
end the Group paid £1.1m in respect of deferred consideration for previous
acquisitions.
Our client retention rate within the financial advisory business remains
exceptionally high at 99%, reflecting positive performance from our portfolios
and our relentless focus on excellent customer service.
The Directors believe the acquisitions made to date have given the Group
visibility and oversight of the Group's future business pipeline in a way that
no other professional services group in the PI and CN space can compete with
and also drives revenue across the Group's entire claims management systems.
We are looking forward to building on the successes of the last year with a
continued focus on growing our core business, driving AUM, integrating our
acquisitions (from a cultural and commercial point of view), maintaining our
outstanding client retention levels and generating strong and sustainable
returns for our shareholders.
group STATEMENT of comprehensive income
for the year ended 31 December 2022
2022 2021
£ £
REVENUE 24,849,888 18,366,425
Direct staff costs (13,716,400) (9,348,803)
_______ _______
GROSS PROFIT 11,133,488 9,017,622
Administrative expenses (8,230,391) (6,174,173)
Other operating income - 24,426
Underlying profit from operations 5,491,891 4,270,243
Share based compensation (659,473) (429,918)
Acquisition strategy, integration and reorganisation costs (1,929,321) (972,450)
_______ _______
profit from operations 2,903,097 2,867,875
Finance and other income (7,587) 145,939
Finance costs (476,716) (319,102)
_______ _______
profit BEFORE TAX 2,418,794 2,694,712
Income tax expense (569,626) (219,094)
________ ________
PROFIT FOR THE YEAR 1,849,168 2,475,618
ITEMS THAT WILL NOT BE SUBSEQUENTLY RECLASSIFIED TO PROFIT OR LOSS:
Gains on property revaluation arising net of tax
127,000 125,000
_______ _______
TOTAL COMPREHENSIVE INCOME FOR YEAR 1,976,168 2,600,618
_______ _______
profit ATTRIBUTABLE TO:
Owners of the parent undertaking 1,652,456 2,336,821
Non-controlling interests 196,712 138,797
_______ _______
total comprehensive INCOME ATTRIBUTABLE TO:
Owners of the parent undertaking 1,779,456 2,461,821
Non-controlling interests 196,712 138,797
_______ _______
Earnings per ordinary share - basic (pence) 1.5p 2.2p
Earnings per ordinary share - diluted (pence) 1.4p 2.1p
Adjusted earnings per ordinary share - basic (pence) 3.8p 3.8p
Adjusted earnings per ordinary share - diluted (pence) 3.6p 3.6p
_______ _______
All amounts are derived from continuing operations.
The Notes to the Financial Statements form an integral part of these financial
statements.
group STATEMENT of FINANCIAL POSITION
As at 31 December 2022
2022 2021
£ £
assets
NON-CURRENT ASSETS
Goodwill and other intangibles 29,579,590 16,255,913
Property, plant and equipment 2,833,905 1,994,710
Investments - -
Loans receivable 161,732 127,986
Deferred taxation - 432,850
_______ _______
32,575,227 18,811,459
CURRENT ASSETS
Accrued income 4,070,941 3,314,440
Trade receivables 10,661,189 6,349,486
Other receivables 749,044 609,947
Investments 100,369 108,863
Cash and cash equivalents 4,986,245 8,617,957
_______ _______
20,567,788 19,000,693
_______ _______
total assets 53,143,015 37,812,152
_______ _______
equity and liabilities 637,216 565,787
equity 22,705,248 13,139,664
Share capital 6,244,702 6,244,702
Share premium 479,103 352,103
Merger reserve (341,174) (341,174)
Revaluation reserve (2,210,554) (2,314,537)
Other reserve 12,296,435 11,716,270
Own shares reserve
Retained earnings
_______ _______
Equity attributable to owners of the parent company 39,810,976 29,362,815
Non-controlling interests 282,739 196,027
_______ _______
TOTAL EQUITY 40,093,715 29,558,842
_______ _______
CURRENT LIABILITIES 759,828 668,742
Current taxation 7,680,044 5,201,045
Trade and other payables
_______ _______
8,439,872 5,869,787
LONG TERM LIABILITIES 4,609,428 2,383,523
_______ _______
TOTAL EQUITY AND LIABILITIES 53,143,015 37,812,152
_______ _______
Group Statement of Changes in Equity for the Year Ended 31(st) December 2022
Share Capital Share Premium Merger reserve Other Own shares Retained Earnings Total Non-controlling interests
Reserve Reserve Revaluation reserve controlling Total
interest
£ £ £ £ £ £ £ £ £ £
Balance 1 January 2021 555,787 12,697,252 5,314,702 (341,174) (4,578,549) 11,110,993 227,103 24,986,114 162,230 25,148,344
Issue of Share Capital 10,000 - 930,000 - - - - 940,000 - 940,000
Share based compensation (note 4) - - - - 450,594 (278,965) - 171,629 - 171.629
Sale of own shares - 442,412 - - 1,813,418 - - 2,255,830 - 2,255,830
Dividend paid - - - - - (1,452,579) - (1,452,579) (105,000) (1,557,579)
_______ _______ _______ _______ _______ _______ _______ _______ _______- _______
Total transactions with 10,000 442,412 930,000 - 2,264,012 (1,731,544) - 1,914,880 (105,000) 1,809,880
owners recognised in equity
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Profit for year - - - - - 2,336,821 - 2,336,821 138,797 2,475,618
Other comprehensive income - - - - - - 125,000 125,000 - 125,000
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Total comprehensive income - - - - - 2,336,821 125,000 2,461,821 138,797 2,600,618
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Balance at 1 January 2022 565,787 13,139,664 6,244,702 (341,174) (2,314,537) 11,716,270 352,103 29,362,815 196,027 29,558,842
Issue of share capital 71,429 9,565,584 - - - - - 9,637,013 - 9,637,013
Sale of own shares - - - - 103,983 - - 103,983 - 103,983
Share based compensation - - - - - 588,654 - 588,654 - 588,654
Dividend paid - - - - - (1,660,945) - (1,660,945) (110,000) (1,770,945)
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Total transactions with owners recognised in equity 71,429 9,565,584 - - 103,983 (1,072,291) - 8,668,705 (110,000) 8,558,705
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Profit for year - - - - - 1,652,456 - 1,652,456 196,712 1,849,168
Other comprehensive income - - - - - - 127,000 127,000 - 127,000
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Total comprehensive income - - - - - 1,652,456 127,000 1,779,456 196,712 1,976,168
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Balance at 31 December 2022 637,216 22,705,248 6,244,702 (341,174) (2,210,554) 12,296,435 479,103 39,810,976 282,739 40,093,715
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
group CASHFLOW STATEMENT
for the year ended 31 December 2022
Group Group
2022 2021
£ £
Profit before 2,418,794
tax
2,694,712
Adjustments to reconcile profit before tax to cash generated from operating
activities:
Finance income 7,587 (141,955)
Finance costs 476,716 319,102
Share based compensation 479,513 290,777
Depreciation and amortisation 574,502 334,073
(Increase)/decrease in accrued income, trade and other receivables (2,205,073) (1,709,141)
(Decrease)/increase in trade and other payables (95,250) (163,555)
_______ _______
Cash generated from operations 1,656,789 1,624,013
Income tax paid (998,911) (884,175)
_______ _______
Cash generated from operating activities 657,878 739,838
Investing activities
Acquisition of property, plant and equipment (239,983) (99,955)
Acquisition of subsidiaries (13,477,532) (6,119,050)
Cash acquired on acquisition of subsidiaries 1,991,826 519,050
Investment - 1,278,146
disposals
Loans advanced (22,076) (27,986)
Dividend received - -
_______ _______
Cash used in investment activities (11,747,765) (4,449,795)
Financing activities
Shares issued (net of costs) 9,637,013 -
Exercise of share options 1,250 83,750
Own shares sold - 2,255,830
Dividends paid (1,770,945) (1,557,579)
Repayment of borrowing (2,183) (235,300)
Interest element of lease payments (35,744) (18,518)
Principal element of lease payments (367,993) (188,384)
Other interest paid and foreign exchange losses (3,224) (9,321)
_______ _______
Cash generated from financing 7,458,174 330,478
Decrease in cash and cash equivalents (3,631,712) (3,379,479)
Opening cash and cash equivalents 8,617,957 11,997,436
_______ _______
Closing cash and cash equivalents 4,986,245 8,617,957
========================================= =========================================
Reconciliation of cash and cash equivalents
Cash at bank and in hand 4,986,245 8,617,957
========================================= =========================================
General information
The preliminary financial information does not constitute full accounts within
the meaning of section 434 of the Companies Act 2006 but is derived from
accounts for the years ended 31 December 2021 and 31 December 2022. The
figures for the year ended 31 December 2022 are audited. The preliminary
announcement is prepared on the same basis as set out in the statutory
accounts for the year ended 31 December 2021. Those accounts upon which the
auditors issued an unqualified opinion, did not include a reference to any
matters to which the auditors drew attention by way of emphasis, without
qualifying their report, and made no statement under section 498(2) or (3) of
the Companies Act 2006, will be delivered to the Registrar of Companies
following the Annual General Meeting.
Statutory accounts for the year ended 31 December 2021 have been filed with
the registrar of Companies. The auditors report on those accounts was
unqualified did not include a reference to any matters to which the auditors
drew attention by way of emphasis, without qualifying their report, and made
no statement under section 498(2) or (3) of the Companies Act 2006.
While the financial information included in this preliminary report has been
prepared in accordance with the recognition and measurement criteria of
International Financial Reporting Standard (IFRS), as adopted by the U.K.,
this announcement does not in itself contain sufficient information to comply
with IFRS.
Frenkel Topping Group Plc is incorporated and domiciled in the United Kingdom.
1 revenue and SEGMENTAL REPORTING
All of the Group's revenue arises from
activities within the UK..
Revenue arising from recurring and non-recurring sources is as follows:
Group Group
2022 2021
£ £
11,044,694 8,933,779
Recurring
Non-recurring 13,805,194 9,432,646
_______ _______
Total revenue 24,849,888 18,366,425
_______ _______
OPERATING SEGMENTS
The Group's chief operating decision maker is deemed to be the CEO. The CEO
has identified the following operating segments:
Financial Services:
This segment includes our independent financial advisory, discretionary fund
management and financial services businesses.
Costs Law:
This segment includes each of our costs law services businesses.
Other Professional Services:
This segment includes our major trauma signposting, forensic accountancy, care
and case management and medico-legal reporting businesses.
Central Services:
This is predominantly a cost centre for managing Group related activities or
other costs not specifically related to a product.
Financial services Costs Other Professional Services Central Services Total
Law
2022
£'000 £'000 £'000 £'000 £'000
Revenue 11,792 7,057 6,001 - 24,850
Depreciation 248 110 217 - 575
Finance Income (8) - - - (8)
Finance Costs 15 9 14 438 476
Profit before tax 3,403 981 1,307 (3,272) 2,419
Corporation tax (251) (174) (268) 123 (570)
Profit After Tax 3,152 807 1,039 (3,149) 1,849
Additions to plant property and equipment 219 333 263 - 817
Additions to Goodwill and other intangibles - - - 13,324 13,324
Financial services Costs Other Professional Services Central Services Total
Law
2021
£'000 £'000 £'000 £'000 £'000
Revenue 10,973 4,972 2,422 - 18,367
Depreciation 287 16 31 - 334
Finance Income 7 - 4 135 146
Finance Costs 16 10 2 291 319
Profit before tax 3,524 1,423 252 (2,504) 2,695
Corporation tax 449 277 51 (558) 219
Profit After Tax 3,075 1,146 201 (1,946) 2,476
Additions to plant property and equipment 184 21 8 - 213
Additions to Goodwill and other intangibles - - - 7.957 7,957
2 TAXation 2022 2021
£ £
Analysis of charge in year
Current tax
UK corporation tax 691,487 758,250
Adjustments in respect of previous periods 6,505 (16,066)
_______ _______
Total current tax charge 697,992 742,184
_______ _______
Deferred tax
Temporary differences, origination and reversal (128,366) (523,090)
_______ _______
Total deferred tax credit (128,366) (523,090)
_______ _______
Tax on profit on ordinary activities 569,626 219,094
_______ _______
Factors affecting tax charge for year
The standard rate of tax applied to reported
profit on ordinary activities is 19 per cent (2021: 19 per cent).
FACTORS AFFECTING FUTURE TAX CHARGE
On 3 March 2022 the Chancellor announced that the corporation tax rate will
rise to 25% from 1 April 2023.
There is no expiry date on timing differences, unused tax losses or tax
credits.
The charge for the year can be reconciled to the profit per the income
statement as follows:
Group Group
2022 2021
£ £
Profit before taxation 2,418,794 2,694,712
_______ _______
Profit multiplied by main rate of corporation tax in the UK of 19% (2021: 19%) 459,571 511,995
Effects of:
Expenses not deductible less capital allowances 231,794 298,506
Share based payments (153,366) (428,426)
Increase in tax rate on deferred tax asset - (111,532)
Other charges/(deductions) 31,627 (51,449)
_______ _______
Total tax expense for year 569,626 219,094
_______ _______
3 EARNINGS PER SHARE
The calculation of the basic and diluted earnings per share is based on the
following data:
Group Group
2022 2021
£ £
Earnings
Earnings for the purposes of basic and diluted earnings per share (net profit 2,336,821
for the year attributable to equity holders of the parent)
1,652,456
Earnings for the purposes of adjusted basic earnings per share (as above, 5,054,747 3,966,220
adjusted for share based compensation, acquisition strategy, reorganisation
costs and unwinding of the discount on deferred consideration)
Number of shares
Weighted average number of ordinary shares for the purposes of basic earnings 112,987,486
per share
119,431,986 (8,102,668)
Weighted average shares in issue
(5,501,669)
Less: weighted average own shares held
_______ _______
113,930,317 104,884,818
7,344,449 6,001,159
Effect of dilutive potential ordinary shares:
- Share options
_______ _______
Weighted average number of ordinary shares for the purposes of diluted 121,274,766 110,885,978
earnings per share
_______ _______
_______
_______
Earnings per ordinary share - basic (pence) 1.45p 2.23p
Earnings per ordinary share - diluted (pence) 1.36p 2.11p
Adjusted earnings per ordinary share - basic (pence) 3.78p 3.78p
Adjusted earnings per ordinary share - diluted (pence) 3.55p 3.58p
_______ _______
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