REG - Frenkel Topping Grp - Final Results
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RNS Number : 3067G Frenkel Topping Group PLC 28 April 2025
The information contained within this announcement was deemed by the Company
to constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014 as it forms part of UK domestic law by virtue
of the European Union (Withdrawal) Act 2018 as amended. With the publication
of this announcement via a Regulatory Information Service, this inside
information is now considered to be in the public domain.
Frenkel Topping Group plc
("Frenkel Topping", "the Company" or the "Group")
Results for the 12 months ended 31 December 2024
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 2024 ("FY24") and an encouraging start to the 2025 financial year.
Financial Highlights
FY 2024 FY 2023 % change
Revenue £37.4m £32.8m 14%
Recurring revenue £13.4m £12.0m 12%
Non-recurring revenue £24.0m £20.8m 15%
Gross profit £14.4m £13.9m 4%
Adjusted EBITDA* £8.0m £8.0m -
Adjusted profit from operations £7.2m £7.2m -
Profit before tax £4.2m £3.2m 31%
EPS - basic 2.3p 1.4p 64%
Adjusted EPS - basic* 3.9p 4.3p (10%)
Total dividends (paid and proposed) 1.375 pence per share 1.375 pence per share
Cash generated from operating activities £2.0m £3.2m
Cash £3.1m £2.4m
Net cash/(debt) (£3.8m) £2.4m
*Adjusted EBITDA and Adjusted EPS are stated after adding back share based
compensation, re-organisation, costs relating to our acquisition strategy and
any exceptional items.
Operational Highlights
● Funds under management ("FUM") of £1,560m (2023: £1,335m) - growth of 17% -
a record year for assets added
● Funds on a discretionary mandate ("DFM") of £1,031m (2023: £820m) - growth
of 26%, a landmark year as we cross £1bn and win a number of awards
● Money Market Solution launched in June 2023 grew to £130m (2023: £39m)
● Acquisition of Northwest Law Services ("NWL") - a leading firm of costs
consultants, already exceeding expectations for revenue and profit
contribution
● Sixteenth consecutive year of high client retention (99%) in investment
management services
● One new Major Trauma Centre added by Cardinal Management Limited ("Cardinal")
during the year and a further Centre added post year end at Sheffield
Children's Hospital and Royal Stoke University Hospital respectively
● Record growth in number of Medico-Legal Expert Witnesses available - a key
driver in future revenue growth
● Revolving Credit Facility of £7.5m put in place with Santander
● Record year of fundraising by Frenkel Topping Charitable Foundation - over
£120k raised to support individuals who have suffered life-changing events
● Welfare Benefits team identified £2.7m (2023: £2.1m) of unclaimed benefits,
demonstrating our commitment to supporting our clients
● Board have assessed the impact of changes in National Insurance & National
Minimum Wage set by the Autumn Budget on future period and taking steps to
minimise as far as is practicable
Richard Fraser, CEO of Frenkel Topping, said:
"Our 2024 results demonstrate the success of our growth strategy over recent
years and the resilience of our business against the backdrop of challenges
faced within our costs segment which had a modest impact on the year end
outturn, as previously announced.
Pleasingly, we have had a record year of growth in FUM thanks to the skills
and expertise of our sales team, aided by the excellent performance of our
DFM, Ascencia Investment Management, which crossed the £1bn threshold, a
landmark achievement.
Our professional services businesses have also continued to grow, with
non-recurring revenue up by 15%, with 9% of the growth in this area coming
from organic growth across our business units. This was aided by the
acquisition of Northwest Law Services during April 2024, which is already
outperforming our original expectations for revenue and profitability.
This demonstrates the strength of the acquisition strategy with the Company
demonstrably identifying businesses that the management has been able to grow
and capture upside opportunities as well as diversifying revenue streams. We
will continue to explore synergies, to invest in our people, data and
efficiencies in order to help us to further take advantage of opportunities
that the enlarged Group presents.
We have started 2025 strongly, with a record first quarter and we remain
confident for the year ahead."
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
Cavendish Capital Markets Ltd (Nominated Adviser & Broker) Tel: 020 7220 0500
Carl Holmes/ Isaac Hooper/ Fergus Sullivan (Corporate Finance) Tim Redfern /
Jamie Anderson (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 Sharialawcompliant 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
Chairman's Statement
Overview
On behalf of the Board of Directors, I am pleased to report on a year of
progress for the Group against a challenging market backdrop, in which we
continued to deliver against our strategy in the personal injury and clinical
negligence space, as shown with the record growth in both FUM and funds on a
discretionary mandate. We have carved out a leading position in our chosen
niche market segment and we continue to consolidate and develop our offering,
ensuring our clients receive the absolute best support and advice in a focused
and consolidated manner.
The year was not without some headwinds, particularly within our Costs segment
at Partners in Costs ("PIC"). However we have addressed these swiftly by way
of strategic appointments and with a focus on optimising key business
processes in this area. We now look forward with positivity with Partners in
Costs having started the new financial year well and contributing positively
again.
Additionally, we were pleased to welcome NWL to the Group during April 2024 to
further strengthen our Costs offering. This has proved an excellent strategic
fit within the Group, offering access to high-quality work with a
customer-focused approach. We continue to look at other acquisition
opportunities where these can complement and add to our existing offering,
whilst also aligning with our values.
Consumer Duty
During 2024 the Group made considerable progress in the embedding of Consumer
Duty, including the appointment of Executive and Non-Executive level
'champions' who meet on a regular basis to address our ongoing commitment to
the Consumer Duty pillars. Management and the Board has worked hard to make
sure there is robust governance in place around Consumer Duty and have ensured
material regulatory implications have been fully addressed and fair value
assessment and associated best practice has been completed and implement.
The pillars of Consumer Duty align with the Group's values in putting clients'
needs first in order to improve outcomes for consumers.
Dividend
Total dividends proposed for the year are 1.375p per share (FY 2023: 1.375p).
Outlook
We have entered 2025 with challenges arising from the Autumn Budget 2024 in
terms of increases in National Insurance (NI) and National Minimum Wage (NMW),
which the team is working hard to minimise the impact of. Additionally, the
work done during 2024 has given us a stable foundation from which to build.
This, alongside our continued investment into people, data and efficiencies,
means we are well positioned to begin to maximise the opportunities of our
broad service offering.
We have seen a strong performance in Q1 and remain confident in achieving
management expectations over the remainder of the year.
Christopher Mills
Chairman
Chief Executive Officer's Statement
Review of the Year
We are pleased to report our results for 2024, a year of record growth in FUM
for the Group which has been the most pleasing result and development against
a tough market backdrop.
This is in no small part, due to the skills and expertise of our consultants,
our Business Development team and the work done across the Group in embedding
our services within solicitor firms in order to ensure that we can be seen as
a trusted partner when the time comes for their clients to invest their
settlement award.
It was particularly pleasing to note that 31% of the new FUM added in FY2024
was added by team members who had previously come through our Graduate Scheme,
which speaks volumes in regards to the success of this scheme and our
continued investment in people.
Our in-house discretionary fund manager, Ascencia Investment Management
(Ascencia), continued to show that its conservative multi-asset investment
approach delivers a smooth client investment experience, focused on asset
protection.
3 year return to 31st December 2024 compared to benchmarks are shown below:
Ascencia continued to demonstrate resilient performance in Q1 2025, despite
heightened economic policy uncertainty and broader market volatility, with MPS
Low to Medium returning 0.89% compared to ARC Sterling Balance Asset PCI
returning -0.46%.
During FY2024 Ascencia was recognised as Highly Commended in the Defaqto
Defensive Comparator Sector and awarded with the ARC 3D Research Award. We are
also pleased to now report that Ascencia has been further recognised in the
Defaqto MPS Awards 2025:
· Defaqto Defensive Comparator Sector - Winner - Ascencia Portfolio of
Sharia Compliant Solutions 4
· Defaqto Defensive Comparator Sector - Highly Commended - Ascencia
Safety First 3
· Defaqto Cautious Comparator Sector - Highly Commended - Ascencia
Portfolio of Sharia Compliant Solutions 5
· Defaqto Balanced Comparator Sector - Highly Commended - Ascencia
Portfolio of Sharia Compliant Solutions 6
We have seen a number of key successes across the wider Group, with growth in
each operating segment, as set out in note 1 of the financial statements. This
is a testament to the hard work of the staff across all of our business units
and I would like to thank them for their efforts during the year, particularly
the team within NWL who we welcomed to the Group during April 2024.
NWL has helped to strengthen our Costs offering which faced a challenging year
but still managed to deliver growth in profit before tax of 10% compared to
2023 and remains a key area of focus for the year ahead. We have continued to
grow our Costs Training Academy with three intakes during 2024 and the same
again planned for 2025.
Within PIC, management addressed a number of challenges faced in the early
part of the year in regards to recruitment and technology. The board addressed
these challenges by restructuring management and business development to align
with the Group's growth strategy and continued to invest in improvements to
technology. We are pleased to report that these actions have led to an
increase in instructions of 26% and increased revenue of 20% in Q1 FY25
compared to FY24. EBITDA has more than tripled in the same period.
Within Cardinal we were pleased to announce a new partnership with the NHS
Major Trauma Centre (MTC) at Sheffield Children's Hospital during 2024, with a
further partnership signed in Q1 2025 with Royal Stoke University Hospital. In
addition to this, Cardinal also launched Re.Source v2.0, a directory made
available to NHS staff at MTCs allowing medical professionals easy access to
make referrals to patients for care needs after discharge from the MTC. These
partnerships allow the NHS to facilitate additional support for patients at
difficult times for them and their families.
Our Medico-Legal Expert Witness business, Somek and Associates ('Somek')
attracted more than 70 new Associates during 2024, growing the overall number
of Medico-Legal experts by 36% which is expected to drive significant revenue
growth in this area. Due to the strength of our recruitment campaigns, the
skills of our Associate Trainers and our robust processes, we believe we can
achieve, and are on track to deliver, similar growth in the number of
Associates during 2025 whilst still upholding the gold standard quality of our
work.
Within Case Management we continued to increase our headcount and geographical
reach in order to expand and fulfil the further untapped potential. Having
evaluated a number of potential acquisition opportunities in this space the
Board has resolved to focus on growing this business division organically,
with our focus shifting to ensuring our Case Managers have full caseloads and
can work efficiently.
National Insurance & National Minimum Wage
As announced post period end, following the most recent government financial
budget the Board spent time assessing the impact on the current financial year
(FY2025) and future periods. The anticipated impact of National Insurance (NI)
and National Minimum Wage (NMW) is expected to be c.£360k in FY2025 and
c.£500k thereafter on an annualised basis. The Board has worked hard, and
continues to do so, in order to mitigate this external headwind as far as
possible through cost control and technology efficiencies.
Market Landscape
According to industry data from NHS Litigation Authority, the NHS paid out
Clinical Negligence Damages of £2.1bn across a total of 6,899 claims during
the 12 months to 31 March 2024 (2023: £2.0bn across 6,888 claims).
Media sources suggest road traffic accidents accounted for 29,540 deaths or
serious injuries with £2.4bn paid out on motor insurance claims during 2023.
Growth Strategy
Our strategic pillars to drive future growth are People, Data and
Efficiencies.
People:
2024 has seen the continued success of our investment in people. In addition
to the 31% of FUM added having come through members of the team who progressed
through our Graduate Training Academy, we also welcomed seventeen new entrants
to our Costs Training Academy, who have all contributed to revenue in the
year.
We have a continued focus in this area in the year ahead, with a further three
intakes to the Costs Academy and one within Financial Services planned.
Data:
We have made considerable progress with regards to how we manage our data
during the year and this continues into 2025 with a focus on data integrity
and consistency with a view to enabling the ability to identify opportunities
and enact cross-selling across the Group.
Efficiencies:
Within our Costs segment, we were able to enhance file transfer technologies
with reported time efficiency improvements of c13 days per month. We have
further work ongoing in this area, both within Costs and Financial Services,
to further improve the time taken to handle work for our clients, cutting down
on manual processing and allowing our team to focus on tasks which add value
for our clients.
These pillars present significant opportunities to continue to grow the
business, increase market share and move towards our goal of growing FUM by
£300m per annum by 2027.
Outlook
2025 has seen a strong start across the Group, with Q1 slightly ahead of
overall Group budget, buoyed by the level of FUM added during 2024 and with a
healthy pipeline in place for the remainder of the year. This performance is
echoed by our transactional businesses and we are particularly pleased with
the performance of our Costs segment during the first quarter, delivering
growth and the team having learnt from challenges faced in the prior year
which we addressed and rectified expeditiously.
These successes and opportunities come against the backdrop of increased costs
relating to Employer's NI and National Minimum Wage, which, as a people-based
business, we are not immune to. However, despite these challenges management
remains confident in our expectations for the year ahead and beyond
Richard Fraser
Chief Executive Officer
Chief Financial Officer's Report
Recurring Revenue
2024 saw record growth in both FUM (17%) and Funds on a Discretionary Mandate
(26%) which in turn led to an increase of 12% in recurring revenue to £13.4m
in 2024 (2023: £12.0m) and means we began 2025 on a strong footing.
Ascencia's 'Money Market Solution', launched in 2023 in order to provide
clients with an investment solution that benefited from the higher interest
rate environment, saw continued demand from both new and existing clients with
total funds reaching £130m (2023: £39m) by the year end. Whilst funds in
this product earn a lower fee than those invested in our other investment
solutions, we have begun to see demand switch back towards our higher-margin
fully-invested products.
Non-recurring revenue
Non-recurring revenue grew by 15% on the whole to £24.0m (2023: £20.8m). Of
this, £1.4m or 6% was related to the acquisition of NWL, whilst pleasingly a
further £1.8m or 9% came from organic growth in the existing Group.
A significant proportion of the organic growth occurred within our
Medico-Legal Expert Witness business, Somek, which reported increased revenue
of 20% (£1.15m) driven by the continued growth in the number of experts added
in recent years, which remains a key focus area for growth moving forward.
Margin
In addition to the impact of lower margin investment solutions in the short
term, margin has suffered during the year as a result of general wage
inflation, increased technology costs and, as discussed within the CEO
Statement, issues faced within our Costs segment.
2024 2023
Revenue 37.4 32.8
Adjusted EBITDA 8.0 8.0
Adjusted EBITDA Margin 21.4% 24.4%
As a people-based service business, the impact of the Autumn Budget 2024 and
general wage inflation represent continued pressures on our margin and it is
unlikely that we will return to our 2023 level overnight. However, as
discussed within the CEO Statement and Strategic Report, we continue to
explore opportunities relating to Data and Efficiencies whilst also investing
in our People with a view to improving efficiencies, minimising the overall
impact of NI and NMW and driving margin improvements in the medium to long
term.
Working Capital
Whilst pre-tax Cash from Operations remains positive at £3.4m, this is down
from 2023's £4.2m. Of this, £0.4m can be explained by lower Profit from
Operations as a result of acquisition costs and exceptional items.
There is also the impact of a slight lengthening of debtor days. Total debtor
days, calculated including trade debtors and accrued income, are shown below
by operating segment and as a comparative to the prior year:
2024 2023
Financial Services 84 88
Costs 385 309
Other professional services 181 185
Total 197 178
The table shows that whilst timing of receipts in relation to Financial and
Other Professional Services have showed slight improvement, our debtor days in
relation to our Costs businesses have extended, a result of delays in the
court systems.
Recent official County Court data shows that multi/fast track claims in the
period ending June 2024 were taking on average 20.2 weeks longer than they did
in 2019, representing a significant delay for those seeking justice, as well
as for the Group's cashflow cycle and that of other professional parties
involved. We welcome the Justice Committee's new enquiry into the work of the
County Court, launched on 21st January 2025, to seek to address these issues.
Within our Court of Protection team, we have seen delays within the Senior
Courts Costs Office (SCCO) also worsen. The SCCO provides a vital service to
vulnerable individuals who lack capacity to manage their own affairs and
require a court appointed deputy.
A Freedom of Information request submitted by the Professional Deputies Forum
showed the average time from receipt of a provisional assessment to the
assessment being carried out has grown significantly:
2019/20 2020/21 2021/22 2022/23 To July 2024
2023/24
Average wait time (days) 35 42 105 175
280 308
In addition to these delays slightly impacting the Group's cashflows, they
also impact on that of the court appointed deputies which can only serve as a
deterrent to anyone in taking on such a role, in turn impacting on the
vulnerable individuals.
The same report does also show that the SCCO has modestly increased staff
numbers to try and address the delays. We welcome this but acknowledge it will
take some time for the newer staff to become efficient in their roles and
begin to reduce the delays.
The action taken by both the Justice Committee and the SCCO gives management
sufficient confidence that these delays are being addressed and will not
represent a long-term issue within our working capital cycle.
Revolving Credit Facility / Net Debt
During January 2025 the Group secured a revolving credit facility of £7.5m
with Santander in order to fund previously committed acquisition related
payments, the acquisition of NWL and give flexibility to continue to pursue
our acquisition strategy. As such, by the year end we have moved to a net debt
position for the first time:
2024 2023
Net cash/(debt) (£m) (3.8) 2.4
Earnings Per Share (EPS)
Whilst stated EPS has improved to 2.3 pence (2023: 1.4 pence) we have seen a
drop off in Adjusted EPS to 3.9 pence (2023: 4.3 pence). This is as a result
of finance costs in relation to debt taken on to fund the acquisition made in
the year and deferred and contingent payments relating to acquisitions made in
prior years.
As we move forward, continuing to grow profitability and increase cashflows we
will begin to reduce debt levels and expect to see improvements in both stated
and Adjusted EPS moving forward.
Elaine Cullen-Grant
Chief Financial Officer
group STATEMENT of comprehensive income
for the year ended 31 December 2024
2024 2023
£'000 £'000
REVENUE 37,401 32,809
Direct staff costs (23,025) (18,943)
_______ _______
GROSS PROFIT 14,376 13,866
Administrative expenses (9,706) (8,797)
Adjusted profit from operations 7,153 7,233
Share based compensation (133) (610)
Other adjustments to profit from operations (2,350) (1,554)
_______ _______
profit from operations 4,670 5,069
Finance and other income 21 20
Finance costs (744) (532)
Revaluation of contingent consideration 204 (1,364)
_______ _______
profit BEFORE TAX 4,151 3,193
Income tax expense (1,120) (1,286)
________ ________
PROFIT FOR THE YEAR 3,031 1,907
ITEMS THAT WILL NOT BE SUBSEQUENTLY RECLASSIFIED TO PROFIT OR LOSS:
Gains on property revaluation arising net of tax
30 80
_______ _______
TOTAL COMPREHENSIVE INCOME FOR YEAR 3,061 1,987
_______ _______
profit ATTRIBUTABLE TO:
Owners of the parent undertaking 2,795 1,661
Non-controlling interests 236 246
_______ _______
total comprehensive INCOME ATTRIBUTABLE TO:
Owners of the parent undertaking 2,825 1,741
Non-controlling interests 236 246
_______ _______
Earnings per ordinary share - basic (pence) 2.3p 1.4p
Earnings per ordinary share - diluted (pence) 2.1p 1.3p
Adjusted earnings per ordinary share - basic (pence) 3.9p 4.3p
Adjusted earnings per ordinary share - diluted (pence) 3.7p 4.0p
_______ _______
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 2024
Group Group
2024 2023
£'000 £'000
assets
NON-CURRENT ASSETS
Goodwill and other intangibles 30,602 29,210
Property, plant and equipment 3,450 2,998
Loans receivable 101 151
_______ _______
34,153 32,359
CURRENT ASSETS
Accrued income 9,057 6,066
Trade receivables 12,480 11,282
Other receivables 911 896
Investments 114 107
Cash and cash equivalents 3,138 2,425
_______ _______
25,700 20,776
_______ _______
total assets 59,853 53,135
_______ _______
equity and liabilities 640 640
equity 22,706 22,706
Share capital 6,155 6,492
Share premium 589 559
Merger reserve (341) (341)
Revaluation reserve (2,130) (2,134)
Other reserve 14,324 13,134
Own shares reserve
Retained earnings
_______ _______
Equity attributable to owners of the parent company 41,943 41,056
Non-controlling interests 308 344
_______ _______
TOTAL EQUITY 42,251 41,400
_______ _______
CURRENT LIABILITIES 1,015 999
Current taxation 6,306 8,112
Trade and other payables
_______ _______
7,321 9,111
LONG TERM LIABILITIES 10,281 2,624
_______ _______
TOTAL EQUITY AND LIABILITIES 59,853 53,135
_______ _______
GROUP STATEMENT OF CHANGES IN EQUITY
Share Capital Share Premium Merger reserve Other Own shares Retained Earnings Total Non-controlling interests
Reserve Reserve Revaluation reserve controlling Total
interest
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance 1 January 2023 637 22,706 6,245 (341) (2,211) 12,296 479 39,811 283 40,094
Issue of Share Capital 3 - 247 - - - - 250 - 250
Share based compensation - - - - 77 - - 77 - 77
Sale of own shares - - - - - 443 - 443 - 443
Dividend paid - - - - - (1,266) - (1,266) (185) (1,451)
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Total transactions with 3 - 247 - 77 (823) - (496) (185) (681)
owners recognised in equity
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Profit for year - - - - - 1,661 - 1,661 246 1,907
Other comprehensive income - - - - - - 80 80 - 80
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Total comprehensive income - - - - - 1,661 80 1,741 246 1,987
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Balance at 1 January 2024 640 22,706 6,492 (341) (2,134) 13,134 559 41,056 344 41,400
Sale of own shares - - - - - - - - - -
Share based compensation - - - - 4 27 - 31 - 31
Non-controlling interests acquired - - (337) - - 58 - (279) (58) (337)
Dividend paid - - - - - (1,690) - (1,690) (214) (1,904)
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Total transactions with owners recognised in equity - - (337) - 4 (1,605) - (1,938) (272) (2,210)
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Profit for year - - - - - 2,795 - 2,795 236 3,031
Other comprehensive income - - - - - - 30 30 - 30
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Total comprehensive income - - - - - 2,795 30 2,825 236 3,061
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
Balance at 31 December 2024 640 22,706 6,155 (341) (2,130) 14,324 589 41,943 308 42,251
_______ _______ _______ _______ _______ _______ _______ _______ _______ _______
group CASHFLOW STATEMENT
for the year ended 31 December 2024
Group Group
2024 2023
£'000 £'000
Profit before 4,151 3,193
tax
Adjustments to reconcile profit before tax to cash generated from operating
activities:
Finance income (21) (20)
Finance costs 744 532
Revaluation of contingent consideration (204) 1,364
Goodwill write off - 62
Share based compensation 234 499
Depreciation and amortisation 852 720
(Increase)/decrease in accrued income, trade and other receivables (2,547) (2,736)
(Decrease)/increase in trade and other payables 192 612
_______ _______
Cash generated from operations 3,401 4,226
Income tax paid (1,430) (1,014)
_______ _______
Cash generated from operating activities 1,971 3,212
Investing activities
Acquisition of property, plant and equipment (238) (290)
Acquisition and deferred consideration payments (5,115) (3,518)
Cash acquired on acquisition of subsidiaries 232 -
_______ _______
Cash used in investment activities (5,121) (3,808)
Financing activities
Exercise of share options - 1
Dividends paid (1,903) (1,451)
Loans received 7,179 237
Repayment of borrowing (257) (201)
Interest element of lease payments (59) (38)
Principal element of lease payments (578) (516)
Interest received 13 13
Other interest paid and foreign exchange losses (532) (10)
_______
_______
Cash (used in)/generated from financing activities 3,863 (1,965)
Decrease in cash and cash equivalents 713 (2,561)
Opening cash and cash equivalents 2,425 4,986
_______ _______
Closing cash and cash equivalents 3,138 2,425
========================================= =========================================
Cash and cash equivalents are held at Santander UK plc.
Frenkel Topping Group Plc
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
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 2024 and 31 December 2023. The
figures for the year ended 31 December 2024 are audited. The preliminary
announcement is prepared on the same basis as set out in the statutory
accounts for the year ended 31 December 2024. 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 2023 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
2024 2023
£'000 £'000
13,405 11,961
Recurring
Non-recurring 23,996 20,848
_______ _______
Total revenue 37,401 32,809
_______ _______
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
2024
£'000 £'000 £'000 £'000 £'000
Revenue 14,207 9,852 13,206 136 37,401
Depreciation 419 166 267 - 852
Finance Income 18 1 1 1 21
Finance Costs 21 8 30 685 744
Profit before tax 4,312 1,769 2,628 (4,558) 4,151
Corporation tax (412) (228) (513) 33 (1,120)
Profit After Tax 3,900 1,541 2,115 (4,525) 3,031
Additions to plant property and equipment 536 179 558 - 1,273
Additions/(disposals) to Goodwill and other intangibles - - - 1,392 1,392
Financial services Costs Other Professional Services Central Services Total
Law
2023
£'000 £'000 £'000 £'000 £'000
Revenue 12,778 8,355 11,570 106 32,809
Depreciation 341 115 264 - 720
Finance Income 12 1 2 5 20
Finance Costs 23 7 18 484 532
Profit before tax 4,153 1,609 2,598 (5,167) 3,193
Corporation tax (625) (306) (352) (3) (1,286)
Profit After Tax 3,528 1,303 2,246 (5,170) 1,907
Additions to plant property and equipment 536 91 202 - 829
Additions/(disposals) to Goodwill and other intangibles - - - (369) (369)
Measures of total assets and total liabilities are not shown as they are not
regularly reviewed by the CEO.
Group Group
2 TAXation 2024 2023
£'000 £'000
Analysis of charge in year
Current tax
UK corporation tax 1,163 1,251
Adjustments in respect of previous periods (10) (7)
_______ _______
Total current tax charge 1,153 1,244
_______ _______
Deferred tax
Temporary differences, origination and reversal (33) 42
_______ _______
Total deferred tax charge/(credit) (33) 42
_______ _______
Tax on profit on ordinary activities 1,120 1,286
_______ _______
Factors affecting tax charge for year
The corporation tax rate rose to 25% from 1
April 2024. The effective standard rate of tax applied to reported profit on
ordinary activities is 25 per cent (2023: 23.52 per cent). 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
2024 2023
£'000 £'000
Profit before taxation 4,151 3,193
_______ _______
Profit multiplied by effective rate of corporation tax in the UK of 25% (2023: 1,038 751
23.52%)
Effects of:
Expenses not deductible less capital allowances 155 241
Revaluation of contingent consideration not tax allowable (51) 321
Deferred tax relating to Share based payments (6) (140)
Previous period adjustments (10) (7)
Deferred tax (27) 162
Other (deductions)/charges 21 (42)
_______ _______
Total tax expense for year 1,120 1,286
_______ _______
3 EARNINGS PER SHARE
The calculation of the basic and diluted earnings per share is based on the
following data:
Group Group
2024 2023
£'000 £'000
Earnings
Earnings for the purposes of basic and diluted earnings per share (net profit
for the year attributable to equity holders of the parent)
2,795 1,661
Earnings for the purposes of adjusted basic earnings per share (as above, 4,759 5,217
adjusted for share based compensation, acquisition strategy, reorganisation
costs and unwinding of the discount on deferred consideration)
Number of shares '000 '000
Weighted average number of ordinary shares for the purposes of basic earnings 127,693
per share
128,013 (5,216)
Weighted average shares in issue
(5,128)
Less: weighted average own shares held
_______ _______
122,885 122,477
7,254 7,300
Effect of dilutive potential ordinary shares:
- Share options
_______ _______
Weighted average number of ordinary shares for the purposes of diluted 130,139 129,777
earnings per share
_______ _______
Earnings per ordinary share - basic (pence) 2.3p 1.4p
Earnings per ordinary share - diluted (pence) 2.1p 1.3p
Adjusted earnings per ordinary share - basic (pence) 3.9p 4.3p
Adjusted earnings per ordinary share - diluted (pence) 3.7p 4.0p
_______ _______
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