REG - STM Group PLC - Interim Results & Investor Presentation
14/09/2022 07:01
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RNS Number : 3466Z STM Group PLC 14 September 2022
(http://www.stmgroupplc.com/) (http://www.stmgroupplc.com/)
14 September 2022
STM Group Plc
("STM", "the Company" or "the Group")
Unaudited Interim Results for the six months ended 30 June 2022
and
Investor Presentation
STM Group Plc (AIM: STM), the multi-jurisdictional financial services group,
is pleased to announce its unaudited interim results for the six months ended
30 June 2022.
Financial Highlights:
2022 2022 2021 2021
(reported)
(reported)
(underlying)**
(underlying)**
Revenue £11.3m £11.3m £11.4m £10.6m
EBITDA* £1.4m £1.7m £1.5m £1.6m
Profit before taxation ("PBT") £0.5m £0.8m £0.9m £0.7m
Profit before other items margin 12% 15% 13% 15%
Earnings per share 0.62p N/A 1.28p N/A
Cash at bank (net of borrowings) £17.0m £16.5m
Interim dividend 0.60p 0.60p
* EBITDA is defined as revenue from continuing operations less operating
expenses i.e. profit from continuing operations before taxation, net finance
income costs, depreciation, amortization, and non operating items such as
bargain purchase gains and gains on the sale of investments
** Underlying statistics are net of certain transactions which do not form
part of the regular operations of the business as further detailed in the
table below
Operating Highlights:
· Predictable recurring revenue remains a cornerstone
of the business
· UK Corporate Pensions business revenues continue to
grow despite "small pot" legislation having come into effect
· Strategic partnerships continue to be developed in
the UK, for example Options SIPP is partnering with IG Group to provide its
pensions SIPP wrapper
· The Mercer SIPP and SSAS acquisition recently
completed, post period end, adds further scale to the UK offering, in line
with the strategy, doubling the UK SIPP & SSAS business
· Further development of operating model to drive
increased revenue growth
· Significant new business now being generated in H2
2022 from our niche annuity products
Commenting on the results and prospects, Alan Kentish, Chief Executive
Officer, said:
"As previously reported, the first six months of the year have been slower
than anticipated for new business, although both the pensions and insurance
businesses show an uplift in revenues relative to the prior year comparable
period.
"The completion of the SIPP and SASS portfolio acquisition from Mercer Ltd as
well as the continued development of several strategic partnerships in the UK
further augment the Group's UK focus and provide scale for further growth.
Equally, the Corporate pensions business continues to grow despite changes in
legislation coming into effect.
"Cost management and operating efficiencies remain key areas of focus for the
Plc board.
"Further to the recently announced Board changes, I take this opportunity to
express my thanks to Duncan Crocker and Malcolm Berryman who recently stepped
down from their roles as Chair and independent Non-Executive Director
respectively. I equally take this opportunity to welcome Nigel Birrell as he
assumes the role of Group Chair and as independent Non-Executive Director, I
look forward to working closely with him in the coming months.
"There remain a number of exciting opportunities which, albeit slower to come
to fruition than we would have liked, makes us optimistic for the future
despite the unsettled macro-economic outlook. In particular, our niche annuity
products are now starting to produce significant new business."
Investor Presentation: 2.00pm today, 14 September 2022
The Directors will hold a presentation to introduce STM Group Plc to investors
and cover the Interim Results and prospects at 2.00 p.m. today, Wednesday 14
September 2022.
The presentation will be hosted through the digital platform Investor Meet
Company. Investors can sign up to Investor Meet Company and add to meet STM
Group Plc via the following link
https://www.investormeetcompany.com/stm-group-plc/register-investor
(https://urldefense.proofpoint.com/v2/url?u=https-3A__www.investormeetcompany.com_stm-2Dgroup-2Dplc_register-2Dinvestor&d=DwMGaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A_CdpgnVfiiMM&r=05PHl3GHdShYuaCii2fBRpoqaNr9B1d97X09daeosu0&m=_R4278x6I1MWW9CJ0oRZBNk9FSdmAMLQt2Sb47D8zFU&s=H2GNe8qPcN0oaN8MUSU-9c1mPxuLXEnTcOLM-j1yt2A&e=)
.
For those investors who have already registered and added to meet the Company,
they will automatically be invited.
Questions can be submitted pre-event to STM@walbrookpr.com
(mailto:STM@walbrookpr.com) or in real time during the presentation via the
"Ask a Question" function.
This announcement contains inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 (as it forms part of retained EU law as defined in
the European Union (Withdrawal) Act 2018).
For further information, please contact:
STM Group Plc
Alan Kentish, Chief Executive Officer Via Walbrook PR
Nicole Coll, Chief Financial Officer www.stmgroupplc.com (http://www.stmgroupplc.com)
finnCap Tel: +44 (0)20 7600 1658
Matt Goode / Emily Watts / Abigail Kelly- Corporate Finance www.finncap.com (http://www.finncap.com)
Tim Redfern / Richard Chambers - ECM
Media enquiries:
Walbrook PR Tel: +44 (0) 20 7933 8780
Tom Cooper / Joseph Walker Mob: +44 (0) 797 122 1972
STM@walbrookpr.com
Notes to editors:
STM is a multi-jurisdictional financial services group traded on AIM, a market
operated by the London Stock Exchange. The Group specialises in the
administration of client assets in relation to retirement, estate and
succession planning and wealth structuring.
Today, the Group has operations in the UK, Gibraltar, Malta, Australia and
Spain. STM has developed a range of pension products for UK nationals and
internationally domiciled clients and has two Gibraltar life assurance
companies which provide life insurance bonds - wrappers in which a variety of
investments, including investment funds, can be held.
STM's growth strategy is focused on both organic initiatives and strategic
acquisitions.
Further information on STM Group can be found at www.stmgroupplc.com
(https://urldefense.proofpoint.com/v2/url?u=http-3A__www.stmgroupplc.com&d=DwMGaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A_CdpgnVfiiMM&r=05PHl3GHdShYuaCii2fBRpoqaNr9B1d97X09daeosu0&m=PU7KD9-tYowY3PC9sXem4PQSmJ-Zm8TJB2ox4M8NHwI&s=39Vvq5Ccz7txaqksRCl4B8zUxhpd6elnqEy0XmTed50&e=)
Chief Executive's Review
Overview
The first half of 2022 was slower than anticipated for new business, although
both our pensions' businesses and life assurance businesses are showing an
uplift in revenue compared to the previous half year position. Revenues from
our businesses in Gibraltar and Malta remain consistent and in line with
management expectations, but revenues in the UK SIPP business are behind plan
as some strategic partners, whilst onboarded, have yet to fully roll out the
product to their distribution network. UK Corporate pensions business revenues
continue to grow despite the impact of the "small pots" legislation coming
into force.
Recurring revenue, a cornerstone of our business, continues to hold up well
and gives the predictability to build a strategy around organic growth.
Like-for-like revenue comparison shows a steady uplift compared to the
previous 2021 half year.
Operational expenses for the first six months were £10.8m (2021: £10.6m),
broadly in line with management expectations, with overruns in certain
businesses being compensated by savings in others. In relation to
non-operational expenses, as classified as "other items" on the income
statement, the non-cash item of amortisation of the client portfolios and IT
development programs are higher than originally anticipated, leading to a
reduction in the reported PBT number.
Optimisation of the operating model continues so as to improve efficiency and
increase margins. This is primarily driven by the roll-out of our internal
administration system and the automation of processes which will continue into
the second half of the year, with margin improvements expected in second half
year and into 2023.
Financial review
Financial performance in the period
The Group delivered revenue in the six months to 30 June 2022 of £11.3m
(2021: £11.4m). The prior year included revenues from the Corporate Trust
Services business of £0.8m which was disposed of in March 2021. Hence, on a
like-for-like basis we have seen revenue growth of 7% across the pensions and
life businesses.
Recurring revenues for the period have remained consistent whilst organic
growth has been achieved in the UK Corporate pensions business and Gibraltar
life business.
Profit before other items for the period is £1.4 million (2021: £1.5
million), with reported profit before tax of £0.5 million (2021: £0.9
million). During the period there have been a number of one-off and
non-recurring costs such as costs associated with internal restructures. Thus,
underlying profit before other items is £1.7 million (2021: £1.6 million)
and underlying profit before tax of £0.8 million (2021: £0.7 million).
The reconciliation of reported measures to underlying measures is made up of
items which are either non-recurring or exceptional and thus do not form part
of the normal course of business. This reconciliation for all three key
financial measures is shown in the table below:
RECONCILIATION OF REPORTED TO UNDERLYING MEASURES
REVENUE EBITDA PROFIT BEFORE TAX
2022 2021 2022 2021 2022 2021
£m £m £m £m £m £m
Reported measure 11.3 11.4 1.4 1.5 0.5 0.9
Add: integration and acquisition costs for H1 - - - - - -
Add: other non-recurring costs - - 0.3 0.2 0.3 0.2
Less: gain on sale of investments - - - - (0.1)
Less: bargain purchase gain and derivative asset - - - - - (0.2)
Less: effect of disposal of Companies and Trust Services (0.8) (0.1) (0.1)
Underlying measure 11.3 10.6 1.7 1.6 0.8 0.7
Cashflows
Cash and cash equivalents at 30 June 2022 were £18.1 million (2020: £18.3
million) with cash generated from operating activities being £1.2 million
(2021: £1.2 million) thus exceeding our reported profit before tax.
Whilst cash balances have decreased compared to the same period for the prior
year, they have remained fairly consistent since the half-year end.
During the period we also repaid £0.3 million of our bank loan with £1.1
million still outstanding. Net cash and cash equivalents as at 30 June 2022
was therefore £17.0 million (2021: £17.3 million). Whilst the Group had
£4.4 million available in the credit facility as at the balance sheet date,
this has been fully drawn down to fund the portfolio acquisition from Mercer
that completed on 31 August 2022.
As would be expected for a Group which is regulated in several jurisdictions,
a significant proportion of our cash balance forms part of the regulatory and
solvency requirements. It is not possible to determine exactly how much of the
cash and cash equivalents are required for solvency purposes as other assets
can also be used to support the regulatory solvency requirement. However, the
total regulatory capital requirement across the Group as at 30 June 2022 was
£16.9 million.
The balance sheet also gives visibility of future revenue and cash generation
and, in line with all administration services businesses, the Group had
accrued income in the form of work performed for clients but not yet billed of
£1.6 million as at the period end (2021: £1.5 million). This gives some
visibility of revenue still to be billed and collected as cash at bank.
Additionally, deferred income relating to annual fees invoiced but not yet
earned stood at £3.9 million (2021: £4.0 million). This figure also gives
good visibility of revenue that is still to be earned through the Income
Statement in the coming months.
Trade receivables as at 30 June 2022 were £3.4 million (2021: £3.1 million).
Dividend
I am pleased to announce that the Board has declared an interim dividend of
0.60 pence per share which is in line with the prior year. The interim
dividend is expected to be paid on 16 November 2022 to those shareholders on
the register on 21 October 2022. The ordinary shares will become ex-dividend
on 20 October 2022.
Subject to trading continuing to perform in line with our revised
expectations, the Board expects to propose a final dividend for the full year.
Review of operations
Pensions
The pensions administration businesses continue to be the cornerstone of our
operations.
Pensions revenue for the period was £9.1 million (2021: £8.7 million)
representing 81% (2021: 76%) of total Group revenues. Total revenue is split
between £4.9 million for QROPS (2021: £4.9 million), £1.9 million (2021:
£1.7 million) for the SIPP and SSAS businesses and a further £1.8 million
(2021: £1.5 million) for the workplace pensions business. In addition, this
year the Group also has a revenue contribution of £0.6 million (2021: £0.6
million) from third party administration and Group Pension Plans.
The recurring revenue percentage for this operating segment remains at 92%,
and when combined with the relatively low attrition rates, remains a solid
predictor of future divisional profitability.
Opportunities and challenges around the pensions businesses are focused on
improving margins in the UK, as well as capitalising on volumes of new
business from our strategic partners. Internationally, the focus is on
increasing revenue through our occupational pension schemes for international
businesses.
Life Assurance
Revenue for the combined Life Assurance businesses amounted to £1.9 million
compared to £1.6 million in 2021. In a similar manner to the pensions
operating segment, our life assurance business also has high levels of
recurring fees.
Our flexible annuity products aimed at the UK market remain the key focus for
sustainable organic growth within our life businesses. Conversion times for
new business remain slow and unpredictable, and continued effort to expand our
intermediary base is an important part of improving our new business numbers.
In addition, the businesses are in the process of launching a suite of
portfolio bonds for the UK market, which will produce a steady flow of new
revenue, giving additional predictability to future organic growth.
Distribution of these products will be via our strategic partners and thus
additional costs for such products will be minimal.
Outlook
In the second half of 2022, we anticipate a healthy uplift in new business
flow for our life assurance businesses in relation to certain of our annuity
products, as well as increased new business flows for our SIPP business
through our strategic partners; such an example being the recent announcement
in relation to our partnering with IG Index.
However, a further benefit of our strategic partner program is that we
anticipate that some of our other core products will also be made available
soon via these platforms.
Having completed the acquisition of the SIPP and SSAS books from Mercer on 31
August, it is paramount that we integrate this business, and the staff, into
our UK Options business in an orderly and efficient manner. The acquisition
doubles our UK SIPP and SSAS business and will allow us to gain some benefits
of scale. The team based in Cardiff is experienced and keen to bring its own
new business relationships and opportunities into the STM family.
As previously announced, we anticipate the acquisition will generate
approximately £0.87m in additional EBIT to STM's current UK business,
Options, on an annualised basis, after a twelve month phased integration
process. As a result of transaction costs of £0.3 million, and specific
integration costs of £0.3 million, it is anticipated for the four months to
31 December 2022 that the acquisition will be a negative contribution of £0.3
million to the Group's result.
As we move forward towards the last quarter of 2022, we have made some
significant changes within our board structure, as well as at subsidiary board
level both at non-executive, as well as senior management level. All of the
above is conducive to accelerating our revenue growth and improving our profit
margins.
I look forward to updating the market with our progress in due course.
Alan Kentish
Chief Executive Officer
CONSOLIDATED INCOME STATEMENT
For the period from 1 January 2022 to 30 June 2022
Notes Unaudited Unaudited Audited
6 months to 6 months to Year to
30 June 30 June 31 December
2022 2021 2021
£'000 £'000 £'000
Revenue 4 11,323 11,386 22,355
Administrative expenses (10,744) (10,629) (20,982)
Profit before other items 579 757 1,373
OTHER ITEMS - 219
Gain on disposal of subsidiaries
120
Gains on revaluation of financial instruments - 222 406
Finance costs (99) (152) (330)
Movement on deferred consideration - - 330
Impairment of goodwill - - (798)
Profit before taxation 480 947 1,200
Taxation (111) (187) 542
Profit after taxation 369 760 1,742
OTHER COMPREHENSIVE INCOME 13 (37) (33)
Items that are or may be reclassified to profit and loss
Foreign currency translation differences for foreign operations
Total other comprehensive income/(loss) 13 (37) (33)
Total comprehensive income for the period/year 382 723 1,709
Profit attributable to: 305 800 1,749
Owners of the Company
Non-Controlling interests 64 (40) (7)
369 760 1,742
Total comprehensive income 318 763 1,716
attributable to:
Owners of the Company
Non-Controlling interests 64 (40) (7)
382 723 1,709
Earnings per share basic (pence) 5 0.62 1.28 2.94
Earnings per share diluted (pence) 5 0.62 1.28 2.94
The results for the period from 1 January 2022 to 30 June 2022 relate to
continuing activities. The results for the period from 1 January 2021 to 31
December 2021 include both continuing and discontinued activities (see Note
6).
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2022
Notes Unaudited Unaudited Audited
30 June 30 June 31 December
2022 2021 2021
£'000 £'000 £'000
ASSETS
Non-current assets
Property, plant and equipment 1,317 1,692 1,663
Intangible assets 19,437 20,066 19,355
Financial assets 881 697 881
Deferred tax asset 76 85 76
Total non-current assets 21,711 22,540 21,975
Current assets
Accrued income 1,550 1,447 1,311
Trade and other receivables 9 6,549 4,019 7,699
Receivables due from insurers 24,130 3,600 24,130
Cash and cash equivalents 8 18,118 18,574 18,207
Total current assets 50,347 27,640 51,347
Total assets 72,058 50,180 73,322
EQUITY
Called up share capital 12 59 59 59
Share premium account 22,372 22,372 22,372
Retained earnings 14,734 13,836 14,429
Other Reserves (467) (482) (480)
Equity attributable to owners of the Company 36,698 35,785 36,380
Non-controlling interests (388) (485) (452)
Total equity 36,310 35,300 35,928
LIABILITIES
Current liabilities
Liabilities for current tax 786 890 640
Trade and other payables 10 9,325 8,081 10,532
Provisions 24,130 3,600 24,130
Total current liabilities 34,241 12,571 35,302
Non-current liabilities
Other payables 11 1,074 1,774 1,628
Deferred tax liabilities 433 535 464
Total non-current liabilities 1,507 2,309 2,092
Total liabilities and equity 72,058 50,180 73,322
CONSOLIDATED CASH FLOW STATEMENT
For the period from 1 January 2022 to 30 June 2022
Notes Unaudited Unaudited Audited
30 June 30 June 31 December
2022 2021 2021
£'000 £'000 £'000
Operating Activities
Profit for the period/year before tax 408 947 1,200
Adjustments for:
Depreciation of property, plant and equipment 333 369 659
Amortisation of intangible assets 445 391 791
Impairment of goodwill - - 798
Taxation paid 35 (447) (14)
Unrealised gains on financial instruments at FVTPL - (222) (406)
(Increase)/decrease in trade and other receivables 1,150 (996) (2,226)
(Increase) in receivables due from insurers - - (20,530)
Decrease/(increase) in accrued income (239) 291 8
Increase/(decrease) in trade and other payables (1,018) 817 (936)
Increase in provisions - 20,530
Net cash from operating activities 1,186 1,150 (126)
Investing activities
Disposal of investments - 2,330 4,821
Purchase of property, plant and equipment (13) (193) (352)
Increase in intangible assets (527) (546) (1,032)
Net cash used in investing activities (540) 1,591 3,437
Cash flows from financing activities
Proceeds from Bank loans - 500 900
Bank loan repayment (275) (138) (1,050)
Lease liabilities paid (473) (437) (469)
Dividends paid 7 - (505) (861)
Net cash from financing activities (748) (580) (1,480)
Increase/(decrease) in cash and cash (102) 2,161 1,831
equivalents
Reconciliation of net cash flow to movement in net funds
Analysis of cash and cash equivalents during the period/year
Increase/(decrease) in cash and cash equivalents (102) 2,161 1,831
Effect of movements in exchange rates on cash and cash equivalents 13 4 (33)
Balance at start of period/year 18,207 16,409 16,409
Balance at end of period/year 18,118 18,574 18,207
STATEMENT OF CONSOLIDATED CHANGES IN EQUITY
For the period from 1 January 2022 to 30 June 2022
Share Share Retained Treasury Foreign Currency Translation Shares Total Non-Controlling Interests Total Equity
Capital Premium Earnings Shares Reserve Based £000's £000's £000's
£000's £000's £000's £000's £000's Payments
Reserve
£000's
Balance at
1 January 2021 59 22,372 13,541 (549) (60) 162 35,525 (445) 35,080
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD
Profit for the year - - 1,749 - - - 1,749 (7) 1,742
Other comprehensive income
Foreign currency translation differences - - - - (33) - (33) - (33)
Transactions with owners, recorded directly in equity
Dividend paid - - (861) - - - (861) - (861)
Changes in ownership interest
31 December 2021 and
1 January 2022 59 22,372 14,429 (549) (93) 162 36,380 (452) 35,928
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD
Profit for the year - - 305 - - - 305 64 369
Other comprehensive income
Foreign currency translation differences - - - - 13 - 13 - 13
Transactions with owners, recorded directly in equity
Dividend paid - - - - - - - - -
Changes in ownership interest
At 30 June 2022 59 22,372 14,734 (549) (80) 162 35,398 (388) (36,310)
NOTES TO THE CONSOLIDATED RESULTS
For the period from 1 January 2021 to 30 June 2022
1. Reporting entity
STM Group Plc (the "Company") is a company incorporated and domiciled in the
Isle of Man and was admitted to trading on the London Stock Exchange AIM
Market on 28 March 2007. The address of the Company's registered office is 18
Athol Street, Douglas, Isle of Man, IM1 1JA. The Group is primarily involved
in financial services.
2. Basis of preparation
Results for the period from 1 January 2022 to 30 June 2022 have not been
audited.
The consolidated results have been prepared in accordance with International
Financial Reporting Standards ("IFRS"), interpretations adopted by the
International Accounting Standards Board ("IASB") and in accordance with Isle
of Man law and IAS 34, Interim Financial Reporting.
3. Significant accounting policies
The accounting policies in these consolidated results are the same as those
applied in the Group's consolidated financial statements for the year ended
31 December 2021. No changes in accounting policies are expected to be
reflected in the Group's consolidated financial statements for the year ended
31 December 2022.
4. Segmental Information
STM Group has four reportable segments: Pensions, Life Assurance, Corporate
Trustee Services and Other Services. Each segment is defined as a set of
business activities generating a revenue stream and offering different
services to other operating segments. The Group's operating segments have been
determined based on the management information reviewed by the CEO and Board
of Directors.
The Board assesses the performance of the operating segments based on turnover
generated. The performance of the operating segments is not measured using
costs incurred as the costs of certain segments within the Group are
predominantly centrally controlled and therefore the allocation of these is
based on utilisation of arbitrary proportions. Management believes that this
information and consequently profitability could potentially be misleading and
would not enhance the disclosure above.
The following table presents the turnover information regarding the Group's
operating segments:
Operating Segment Unaudited Unaudited Audited
6m 2022 6m 2021 2021
£'000 £'000 £'000
Pensions 9,072 8,690 17,597
Life Assurance 1,910 1,638 3,402
Other Services 341 284 582
11,323 10,612 21,581
Corporate Trustee Services - 774 774
Total 11,323 11,386 22,355
Analysis of the Group's turnover information by geographical location is
detailed below:
Geographical Segment Unaudited Unaudited Audited
6m 2022 6m 2021 2021
£'000 £'000 £'000
Gibraltar 2,976 3,172 6,099
Malta 3,755 3.670 7,288
United Kingdom 4,251 3,822 7,952
Jersey - 445 445
Other 341 277 571
11,323 11,386 22,355
5. Earnings per Share
Earnings per share for the period from 1 January 2022 to 30 June 2022 is based
on the profit after taxation of £368,000 divided by the weighted average
number of £0.001 ordinary shares during the period of 59,408,088 basic.
A reconciliation of the basic and diluted number of shares used in the period
ended 30 June 2022 and 30 June 2021 is as follows:
2022 2021
Weighted average number of shares 59,408,088 59,408,088
Share incentive plan - -
Diluted 59,408,088 59,408,088
6. Discontinued operation
On 23 March 2021 the Group disposed of its Gibraltar company and trustee
services ("CTS") and tax compliance businesses. On 8 May 2021 the Group
disposed of its Jersey based CTS businesses. These businesses were previously
classified as held-for-sale and are now discontinued operations.
There results for the discontinued operation included in the six month period
ended 30 June 2021 and the year ended 31 December 2021 are shown below. There
are no results for discontinued operations included in the six month ended 30
June 2022:
£'000
Revenue 785
Expenditure (736)
Results from operating activities 38
Income tax _
Results from operating activities, net of tax 38
Gain on sale of discontinued operation 219
Profit from discontinued operation 257
The profit from the discontinued operation is attributable entirely to the
owners of the Company.
7. Dividends
The following dividends were declared and paid by the Group during
the period:
Unaudited Unaudited Audited
30 June 30 June 31 December
2022 2021 2021
£'000 £'000 £'000
0.0 pence (2021: 0.85 pence) per qualifying ordinary share - 505 881
8. Cash and cash equivalents
Cash at bank earns interest at floating rates based on prevailing rates. The
fair value of cash and cash equivalents in the Group is £18,118,000.
9. Trade and other receivables
Unaudited Unaudited Audited
30 June 30 June 31 December
2022 2021 2021
£'000 £'000 £'000
Trade receivables 3,421 3,077 3,921
Prepayments 723 581 508
Other receivables 2,405 3,962 3,270
Total 6,549 7,620 7,699
10. Trade and other payables
Unaudited Unaudited Audited
30 June 30 June 31 December
2022 2021 2021
£'000 £'000 £'000
Deferred income 3,869 4,014 3,579
Trade payables 547 549 638
Bank loan 550 552 550
Lease liabilities 638 651 747
Contingent consideration 56 700 170
Other creditors and accruals 3,665 5,215 4,848
9,325 11,681 10,532
The Company maintains a credit facility with Royal Bank of Scotland
(International) Ltd for £5.50 million. The facility has a 5-year term with
capital repayments structure over ten years and a final instalment to settle
the outstanding balance in full at the end of the 5 years. At the period-end
£1.6 million of this facility had been drawn down with £1.2 million
outstanding. Interest on the drawn funds is charged at 3.5% per annum over the
Sterling Relevant Reference Rate, with the undrawn balance charged at an
interest rate of 1.75% per annum over the Sterling Relevant Reference Rate.
The facility is subject to customary cashflow to debt service liability ratios
and EBITDA to debt service liability ratio covenants tested quarterly and is
secured by a capital guarantee provided by several non-regulated holding
subsidiary companies within the Group and debenture over these companies.
Whilst the Group had £4.4 million available in the credit facility as at the
balance sheet date, this has been fully drawn down to fund the portfolio
acquisition from Mercer that has completed on 31 August 2022.
11. Other payables - amounts falling due in more than a year
Unaudited Unaudited Audited
30 June 30 June 31 December
2022 2021 2021
£'000 £'000 £'000
Lease liabilities 273 831 637
Bank loan 625 773 900
Other payables 175 170 91
1,503 1,774 1,628
12. Called up share capital
Unaudited Unaudited Audited
30 June 30 June 31 December
2022 2021 2021
£'000 £'000 £'000
Authorised
100,000,000 ordinary shares of £0.001 each 100 100 100
Called up, issued and fully paid
59,408,088 ordinary shares of £0.001 each 59 59 59
13. Subsequent events
On 31 August 2022 STM completed the acquisition of the portfolio, net assets,
and trustee companies of the SIPP and SSAS businesses, from Mercer Ltd for a
total purchase price of £3.34m. The acquisition was funded through drawing
down the of the unutilised portion of the RBS facility.
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