REG - Team PLC - Half-year Report
27/06/2024 07:00
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RNS Number : 0276U Team PLC 27 June 2024
27 June 2024
TEAM plc
("TEAM " or the "Company ")
Interim Results
TEAM well-placed for International Growth on the back of Wealth exodus
TEAM plc (AIM: TEAM), the wealth, asset management and complementary financial
services group, is pleased to announce its interim results for the six months
to 31 March 2024.
Commenting on the results Mark Clubb, Executive Chairman of TEAM, said: "We
have significant growth opportunities ahead. Britain has seen a material
exodus of the wealthy following Brexit and tax reforms. According to a recent
report* Britain will lose 9,500 millionaires this year, more than double the
previous year and nearly seven times the number in 2022. Critically for TEAM,
they are re-locating to cities where we are strong and can provide the
financial advice and offshore services they require. This is therefore an
important tail-wind as we expand our international platform servicing the
financial needs of expatriates not just from Britain but from all
nationalities. With AUM/A now close to 1 billion we are in a good position and
will look to build on this during the reminder of the financial year and
beyond." *Henley & Partners' "Private Wealth Migration Report 2024"
Financial Highlights
· Revenues increased 116% to £4.1 million (HY 23: £1.9 million)
· Loss before tax of £1.0m (HY 23: Loss £0.5m)
· Group assets under management / advice up 87% to £916m (HY 23:
£493m) with £97 million in model portfolios
· Successful fund raise of £1.8 million: £1.3 million in new equity,
£500,000 in a convertible loan note
Operational Highlights
· Strategic focus on migrating assets under advice to assets under
management, primarily through TEAM Multi Asset Portfolio Strategies (MPS), to
drive future group profitability
· Continued expansion of the number of financial advisors in the
International division and targeting ex-pat professional clients working in
Asia, Africa and the Middle East - team highly motivated to introduce clients
to TEAM AM services
· Strong growth in model portfolio AuM, up 372% to £97 million (Mar
'23 £20 million), showing the benefits of vertical integration
· Launch of unitised version in H2 24 key to unlocking Team
International AuA for conversion into AuM at management fees of 0.5% - 1.5%
· Excellent investment performance has underpinned positive response to
models by advisers and their clients
· Jersey advisory integration complete, launched in Guernsey in H2 24
Current trading
· Stable start to the beginning of H2
· Progressing advanced discussions with a strategic investor for
additional funding and deeper collaboration
For further information, please contact:
Team plc Tel: +44 (0) 1534 877210
Mark Clubb / Matthew Moore
Strand Hanson (Nominated Advisor) Tel: +44 20 7409 3494
Richard Johnson / James Spinney / David Asquith
Oberon Capital (Joint Broker to TEAM) Tel: +44 20 3179 0500
Michael Seabrook, Adam Pollock, Jessica Cave
Hannam & Partners (Financial Advisor to TEAM) Tel: +44 20 7907 8500
Giles Fitzpatrick / Ernest Bell / Richard Clarke
Novella Communications (Financial PR) Tel: +44 20 3151 7008
Tim Robertson / Safia Colebrook team@novella-comms.com
About TEAM plc
TEAM plc is building a new wealth, asset management and complementary
financial services group. With a focus on Jersey and International Finance
Centres, the strategy is to build local businesses of scale around TEAM plc's
core skill of providing investment management services. Growth will be
achieved via targeted and opportunistic acquisitions, team and individual
hires, collaboration with suitable partners, and by organic growth and
expansion.
TEAM plc has three principal activities, Investment Management, Advisory, and
International.
Investment Management provides discretionary investment management services,
model portfolios, bespoke portfolios and fund management services via fixed
income and equity fund vehicles. Total assets managed as at 30 September 2023
were £289 million (30 September 2022: £233 million).
Advisory - primarily for individuals resident in Jersey, investment
consultancy services to wealthy individuals and trusts and treasury advisory
service for institutions, professional advisers, trustees and high net worth
individuals. Total assets advised on as at 30 September 2023 were £365
million (30 September 2022: £318 million).
International is the Group's financial advisory, fund distribution division
and insurance brokering services covering Africa, the Middle East and Asia.
Total assets advised on as at 30 September 2023 were £180 million (30
September 2022: £nil).
At 30 September 2023, the Group had 87 staff (30 September 2022: 33), with 52
in the UAE, 29 in Jersey, 3 in Singapore and 1 each in the UK, South Africa
and Malaysia (30 September 2022: 32 in Jersey and 1 in the UK). There were
also 10 self-employed advisers, 8 with BVI contracts and 2 in Jersey.
Executive Chairman's Statement
Dear Shareholders,
The six months leading up to the end of March 2024, were highly active. We
completed the acquisition of Neba businesses on December 12, 2023, enhancing
our international expansion. John Beverley, Neba's founder, is now CEO of our
offices in Dubai, Abu Dhabi, Kenya, South Africa, Malaysia, and Singapore. He
is also a substantial shareholder and between us we own 20% of the business.
At the start of the year, we focused on remediating the Globaleye businesses
acquired in 2023. We are nearing the end of this process. Our recruitment
efforts have intensified, beginning with the appointment of Bart Kendall as
Managing Director for the Middle East and Will Price as Managing Director for
Asia. The management structure is evolving positively.
We have new advisors set to join before the end of September. Our goal is to
expand from around 70 advisors to over 100 within the next 12 months, with a
promising pipeline already committed.
To meet cashflow requirements, we initiated a fund raise in March 2024,
supported by our new Nomad, Strand Hanson, and brokers Oberon Capital. Despite
challenging market conditions we successfully raised £1.8 million: £1.3
million in new equity at 20p and £500,000 in a convertible loan note from
Harwood Capital. Further details on funding requirements are set out in the
Operational and Financial Review.
Since then, we are pleased to announce that we are in ongoing discussions with
a strategic investor for additional funding and deeper collaboration. These
talks underscore our commitment to securing partnerships that align with our
long-term vision and capacity to deliver meaningful growth and value to
shareholders. The potential investor is expected to bring both financial
investment and strategic insights and expertise that will bolster our
international market position and drive repeatable growth, although there is
no guarantee that the discussions will lead to a successful conclusion. We
remain dedicated to transparency throughout this process and look forward to
updating shareholders on developments. This dialogue is a testament to the
robust foundations we have built and our focus on future opportunities in the
international financial services markets.
Our investment strategy focuses on migrating assets under advice to assets
under management, primarily through TEAM Multi Asset Portfolio Strategies
(MPS), which will drive future group profitability. The MPS Investment
performance remains strong, and assets under management have grown to £97
million.
Period to 31 March 2024 3 month 1 year 3 year 5 year
Multi Asset Growth 6.2% 12.4% 19.3% 41.8%
MPI High Risk 4.4% 11.4% 13.1% 32.3%
Outperformance 1.8% 1.0% 6.3% 9.6%
Multi Asset Balanced 6.0% 10.7% 17.5% 27.7%
MPI Medium Risk 2.5% 8.0% 7.9% 21.5%
Outperformance 3.5% 2.7% 9.6% 6.2%
Multi Asset Cautious 4.8% 9.1% 13.1% 17.6%
MPI Low Risk 1.4% 6.4% 2.8% 10.3%
Outperformance 3.4% 2.7% 10.3% 7.3%
We hope that Neba Private Clients and Concentric Guernsey will be significant
supporters of the TEAM MPS given its strong performance and anticipate funds
to flow once the investment models are unitized, which we expect to be in Q4
2024. The UCITS unitization project will open new distribution channels,
especially for the clients of our International advisers. Waystone in Dublin
will handle the fund and trust administration.
We have historic annualized revenues now exceeding £9 million and approaching
£1 billion in assets under advice/management, primarily in regions
experiencing significant wealth growth and our clients typically have high
disposable incomes.
We have significant growth opportunities ahead. Britain has seen a material
exodus of the wealthy following Brexit and recent tax reforms. According to
Henley & Partners' "Private Wealth Migration Report 2024," Britain will
lose 9,500 millionaires this year, more than double the previous year and
nearly seven times the number in 2022( www.henleyglobal.com
(http://www.henleyglobal.com) ). Britain is second only to China for
high-net-worth outflows. But it's not just the British and Chinese on the
move. In 2024, a record 128,000 millionaires are expected to relocate, up from
120,000 in 2023 and 110,000 pre-pandemic in 2019.
Wealthy Britons and other nationalities are flocking to the UAE and Singapore
as well as other favourable tax and investor-friendly regulation "Safe
Haven's". These "Expats" or individuals living outside their native country
are moving abroad temporarily or permanently for tax, work, lifestyle,
retirement, or other reasons. This year, Singapore will gain 3,500
millionaires while the UAE welcomes 6,700. The UAE is rolling out the red
carpet for the wealthy with a golden visa programme offering a 10-year
renewable residence for a GBP500,000 property investment and no income,
capital gains or inheritance taxes. The UAE now boasts 20 billionaires and
116,500 millionaires. Up and coming are Saudi Arabia, Malta, Mauritius,
Monaco, Spain, France and New Zealand. All of them are projected to see net
inflows of over 200 millionaires each in 2024.
The wealthy are all heading to regions where TEAM can cover their needs, they
are going to require financial advice and offshore services, including asset
and cash management, life insurance, tax and retirement planning, estate
planning, mortgages and loans, property ownership advice, trusts and/or
foundations and currency exchange.
I call these pools of expertise and services TEAM "castles", all focused on
delivering strong, regulated financial services for global clients and locals,
emphasizing continuity and expertise, ensuring strong client-advisor
relationships and spanning borders and regulatory environments. These castles
are growing in value, just on a replacement cost basis, let alone availability
as jurisdictions tighten regulations and law. They have moats which are
getting deeper and wider.
The TEAM strategy for growth? More castles and more advisers, with a focus on
recruitment, which should deliver a growing base of clients with more
disposable income.
Clients have strong relationships with their financial advisor and appreciate
continuity in financial planning and investment strategies. By being part of a
network, the advisor or client can maintain these relationships even if they
move locations or switch firms within the network. Clients also have the
security of being part of a London Stock Exchange listed "castle". For
recruitment, few alternatives have the spread of network and are listed. That
provides transparency, governance and security.
I remain confident in being able to achieve our short and longer-term
prospects. Achieving breakeven remains the immediate aim alongside the goal of
scalability and "escape velocity" targeting growing the business to £20
million in revenues, 30%+ EBITDA margin, and £4 billion in AUA/M.
Thank you.
Sincerely,
Mr J M Clubb
Executive Chair
26 June 2024
Operational and Financial Review
Review of the results for the period
The table below shows the Group's financial performance for the six months to
31 March 2024 along with prior comparative periods and provides a
reconciliation to the underlying results, which the Company considers to be an
appropriate reflection of the Group's underlying trading, and the statutory
result.
The first six months of the financial year include a full contribution from
Globaleye, acquired in June 2023, and a part contribution from Neba, acquired
in December 2023. These acquisitions account for most of the changes from the
previous interim results to March 2023.
Revenues increased 116% to £4.1 million from £1.9 million while the
underlying loss before tax of the group was £1.0 million, an increase from a
loss of £0.4 million. Underlying adjustments of £21,000, reflecting non-cash
expenses, were down from £132,000. The loss per share for the period was
3.5 pence (H1 23: 2.3 pence) and no dividend is recommended at this point in
the Company's development (H1 23: nil).
6 months ended 31 Mar 2024 (unaudited) 6 months ended 31 Mar 2023 (unaudited) 12 months ended 30 Sept 2023 (audited)
£'000 £'000 £'000
Revenue 4,106 1,898 5,323
Direct Cost (1,490) (228) (924)
Contribution 2,616 1,670 4,399
Total staff costs (2,260) (1,393) (3,359)
Total non-staff costs (1,348) (651) (1,727)
Underlying profit before tax (992) (374) (687)
Underlying adjustments (21) (132) 244
Loss before tax (1,013) (506) (443)
Tax 3 7 (2)
Loss for the period (1,010) (499) (445)
Client assets
The table below shows the opening and closing client asset position and the
movements during the period broken down by division.
Division Investment Management Advice and Consultancy International Total
£'m £'m £'m £'m
As at 30 Sept 2023 289 263* 180 732
Inflows 22 6 60 88
Outflows (5) (10) - (14)
Other 15 13 - 27
From acquired businesses - - 84 84
As at 30 March 2024 321 271 324 916
Growth in period 11% 3% 80% 25%
Net inflows (£'m) 18 - 4 60 73
Inflow as % of opening balance 6% -2% 33% 10%
*£55 million of client assets where an investment reporting service is
provided have been excluded from the A&C total.
Within the Investment Management division the model portfolios, now available
on five investment platforms, increased from £20 million (H1 23) to £97
million. Material flows into the models are expected from our newly
established Guernsey Advice operation, and as the portfolios become available
in a single UCITS structure, where they become suitable for many of our
International clients.
Revenues
Total revenues rose 116% to £4.1 million (H1 23: £1.9 million). Investment
and fund management ("IFM") revenues rose 23% to £0.6 million, reflecting the
higher yield on the incremental asset managed in the models and the 11%
increase in AUM. Advisory and Consultancy ("A&C") revenues fell 36% to
£1.0 million (H1 23: £1.6 million), primarily as there was a one-off
settlement of £0.6 million received in the prior period. Excluding this item
revenues were up 3%. International recorded its first H1 revenues of £2.5
million (H1 23: nil).
Costs
Direct costs, being the cost of commissions paid to International advisers,
and the custody and trading costs incurred for certain clients in IFM, rose
significantly from £0.2 million to £1.5 million. This is a feature of the
International business model, where the self-employed adviser receive no or
small salaries, and high commission shares on business written. The indirect
cost, being primarily the costs of staff, office and technology, rose to £3.6
million, up 76% on H1 23. Of this increase of £1.6 million, £1.5 million was
from International, with the costs across the rest of the group falling by 2%
despite inflation running at over 7% in Jersey. This reflects the cost cutting
measures taken in the consolidation of the A&C division (down 9%) and in
IFM (down 12%).
Loss before tax
The resulting loss before tax for the half year was £1.0 million (H1 23:
£0.5 million), with the underlying position a loss of £1.0 million (H1 23:
£0.4 million)
The underlying adjustments are shown in the below table:
6 months ended 31 Mar 2024 (unaudited) 6 months ended 31 Mar 2023 (unaudited) 12 months ended 30 Sept 2023 (audited)
£'000 £'000 £'000
Underlying (loss) before tax (992) (374) (687)
Amortisation of client relationships (497) (497) (995)
Acquisition related expenses (52) - (222)
Changes in deferred consideration 670 452 1,680
Interest and depreciation (142) (87) (219)
Total underlying adjustments (21) (132) (682)
(Loss) before tax (1,013) (506) (443)
Adjustments to the statutory loss have been selected to give a more
informative indication of the trading of the group.
Amortisation of client relationships was unchanged at £0.5 million.
Acquisition related expenses incurred in the period were £52,000 (H1 23:
nil). Changes in deferred consideration were £0.7 million (H1 23: £0.5
million) of which £0.5 million was from the fall in the value of the 3.2
million shares due to be issued for the consideration to acquire Neba, and
£0.2 million from the fall in the expected revenue related deferred
consideration for the Omega acquisition.
Segmental analysis
The Group operates in three divisions, supported by the PLC head office.
International is a new division following the Globaleye and Neba acquisitions:
6 months ended 31 Mar 2024 IFM A & C International Group and consolidation adjustments Group
(unaudited)
£'000 £'000 £'000 £'000 £'000
Revenue 630 998 2,477 1 4,106
Direct Cost (209) (6) (1,261) (15) (1,490)
Contribution 421 992 1,216 (14) 2,616
Indirect Costs (649) (1,025) (1,522) (412) (3,608)
Underlying (loss) before tax (228) (33) (305) (426) (992)
Underlying adjustments - - - (21) (21)
(Loss) before tax (228) (33) (305) (447) (1,013)
Tax 4 - (1) - 3
(Loss) for the period (224) (33) (306) (447) (1,010)
6 months ended 31 Mar 2023 IFM A & C Group and consolidation adjustments Group
(unaudited)
£'000 £'000 £'000 £'000
Revenue 511 1,548 (161 1,898
Direct Cost (200) - (28) (228)
Contribution 311 1,548 (189) 1,670
Indirect Costs (715) (1,166) (163) (2,044)
Underlying (loss)/profit before tax (404) 382 (352) (374)
Underlying adjustments - - (132) (132)
Profit before tax (404) 382 (484) (506)
Tax 43 (36) - 7
(Loss)/profit for the period (361) 346 (484) (499)
12 months ended 30 Sept 2023 (audited) IFM A & C International Group and consolidation adjustments Group
£'000 £'000 £'000 £'000 £'000
Revenue 951 3,039 1,332 1 5,323
Direct Cost (372) - (497) (55) (924)
Contribution 579 3,039 835 (54) 4,399
Indirect Costs (1,416) (2,052) (967) (651) (5,086)
Underlying (loss) /profit before tax (837) 987 (132) (705) (687)
Underlying adjustments - - - 244 244
(Loss)/ Profit before tax (837) 987 (132) (461) (443)
Tax (4) 5 (3) - (2)
(Loss)/ profit for the year (841) 992 (135) (461) (445)
Taxation
Regulated financial services businesses in Jersey pay a flat corporation tax
rate of 10%. The treasury services business is not regulated and has a nil tax
rate. The International entities operate predominantly in nil corporation tax
environments.
Earnings per share
The Groups underling loss per share was 3.5 pence, an increase of 52% from a
loss per share of 2.3 pence in H1 23.
Financial position and going concern
The Group's cash position has increased from £0.9 million to £1.5 million.
As at 31 March 2024 the regulated entities within the Group all held in excess
of the required level of regulatory assets.
The Directors have prepared financial projections along with sensitivity
analyses of reasonably plausible alternative outcomes, covering clients and
assets, cost inflation and take up of group services. The forecasts
demonstrate that the Directors have a reasonable expectation that the Group
will require additional financial resources to meet working capital
requirements and the cash-settled deferred consideration liabilities due in
the financial year ending 30 September 2025. The requirement for additional
fundraising has been highlighted as a feature of the business model for TEAM
in the initial years on the business plan. The placing and subscription in May
2024, which raised £1.3 million and an additional £0.5 million via a
convertible loan note, has enabled the business to recapitalise the Globaleye
entities and top up the regulatory capital of the nine regulated entities.
Further external funding will be required to see the business through to a
cash flow positive state and to fund all deferred consideration payments and
the Board is in advanced discussions with various parties to provide such
funding. The track record of TEAM in fund raising from the current and
potential shareholder base, and the ongoing funding discussions, gives the
Board sufficient confidence to consider the going concern basis to be
appropriate for the accounts.
Dividend
The Group is at the early stages of building the business, and so is consuming
capital. No dividends are expected to be paid until underlying profits are
made.
Mr M C Moore
CFO and COO
26 June 2024
Consolidated Statement of Comprehensive Income
6 months ended 6 months ended 12 months ended
31 Mar 2024 31 Mar 2023 30 Sept 2023
(unaudited) (unaudited) (audited)
Note £'000 £'000 £'000
Revenues 3 4,106 1,898 5,323
Cost of sales 3 (1,490) (228) (924)
Operating expenses 3 (4,236) (2,610) (6,474)
Operating (loss) (1,620) (940) (2,075)
Operating (loss) before exceptional items (1,568) (940) (1,853)
Exceptional items 8 (52) - (222)
Operating (loss) after exceptional item (1,620) (940) (2,075)
Fair value gains on financial instruments 5 670 452 1,680
Share award expense - - (13)
Other charges (63) (18) (35)
(Loss) on ordinary activities before tax (1,012) (506) (443)
Taxation (3) (7) 2
(Loss) for the year/ period and total comprehensive loss (1,010) (499) (445)
Loss per share (basic and diluted) 11 (3.5p) (2.3p) (2.0p)
The accompanying notes on pages 15 to 24 form an integral part of these
Condensed consolidated financial statements.
Consolidated Statement of Financial Position
31 Mar 2024 31 Mar 2023 30 Sept 2023
(unaudited) (unaudited) (audited)
Note £'000 £'000 £'000
ASSETS
Non-current assets
Intangible assets 5,888 6,883 6,386
Goodwill 6 7,092 1,896 6,012
Property, plant & equipment 7 65 79 80
Right of use asset 7 503 615 574
Deferred tax 157 199 152
Long term deposit 74 67 71
13,780 9,739 13,275
Current assets
Trade, other receivables and prepayments 880 961 731
Cash and cash equivalents 4 1,522 864 1,938
2,402 1,825 2,669
Total assets 16,182 11,564 15,944
LIABILITIES
Amounts falling due within one year
Trade and other payables (1,957) (565) (2,080)
Lease liability (94) (110) (152)
Deferred consideration 5 (1,320) (1,338) (3,756)
(3,371) (2,013) (5,988)
Amounts falling due after one year
Lease liability (446) (555) (441)
Loan notes (1,184) (838) (425)
Deferred (1,115) - (865)
consideration
5
(2,745) (1,393) (1,731)
Total liabilities (6,116) (3,406) (7,719)
Total net assets 10,066 8,158 8,225
EQUITY
Stated capital 9 15,200 12,349 12,349
Share award reserve 13 - 13
Retained earnings (5,147) (4,191) (4,137)
Total Equity 10,066 8,158 8,225
The condensed consolidated interim financial statements were approved and
authorised for issue by the board of the directors on 26 June 2024 and were
signed on its behalf by:
Mr J M
Clubb
Mr M C Moore
Executive
Chair
CFO and COO
Consolidated Statement of Cash Flows
6 months ended 6 months ended 12 months ended
31 Mar 2024 31 Mar 2023 30 Sept 2023
(unaudited) (unaudited) (audited)
Note £'000 £'000 £'000
Cash flows from operating activities
(Loss) for the year before tax (1,013) (506) (443)
Adjustments to cash flows from non-cash items:
Depreciation and amortisation 576 567 1,166
Finance costs 64 18 35
Fair value (gains) on financial instruments (670) (452) (1,680)
Share award expense - - 13
Trade and other receivables (152) 87 (336)
Trade and other payables 21 (494) 425
Net cash outflow from operating activities (1,174) (780) (820)
Cash flows from investing activities
Payment of deferred consideration - - (20)
Acquisition of property, plant and equipment - (30) (45)
Net cash outflow from investing activities - (30) (65)
Cash flows from financing activities
Lease liability paid (58) (73) (201)
Proceeds from loan notes issued 735 - 425
Net cash flow from financing activities 677 (73) 224
Net decrease in cash and cash equivalents (497) (883) (661)
Cash and cash equivalents from at beginning of period/ year 1,938 1,747 1,747
Cash and cash equivalents from acquired subsidiaries 81 - 852
Cash and cash equivalents at end of period/ year 1,522 864 1,938
Consolidated Statement of Changes in Equity
Stated Share award Retained Total
capital Reserve earnings equity
£'000 £'000 £'000 £'000
At 1 October 2022 12,349 - (3,629) 8,657
(Loss) for the period - - (499) (499)
At 31 March 2023 12,349 - (4,191) 8,158
Stated Share award Retained
capital reserve earnings Total
£'000 £'000 £'000 £'000
At 1 April 2023 12,349 - (4,191) 8,158
Profit for the period - - 54 54
Share award for the year - 13 - 13
At 30 September 2023 12,349 13 (4,137) 8,225
Stated Share award Retained
capital reserve earnings Total
£'000 £'000 £'000 £'000
At 1 October 2023 12,349 13 (4,137) 8,225
New share Capital 2,851 - - 2,851
(Loss) for the period - - (1,010) (1,010)
At 31 March 2024 15,200 13 (5,827) 10,066
Notes to the Consolidated Financial Statements
1. General information
TEAM plc (the "Company") is the parent company of a group of companies (the
"Group") which offers a range of investment management, fund management,
financial planning and other financial services to retail, professional and
institutional clients.
The Company is a public limited company and is incorporated and domiciled in
Jersey, Chanel Islands. The address of the registered office is 6 Caledonia
Place, St Helier, Jersey, JE2
2. Accounting policies
Basis of preparation and accounting policies
The accounting policies and estimates adopted are consistent with those of the
previous financial period as disclosed in the 2023 Report and Audited
Consolidated Financial Statements.
The financial information in this interim report has been prepared in
accordance with the disclosure requirements of the AIM Rules for Companies and
the recognition and measurements of International Financial Reporting
Standards ("IFRS"), as adopted by the European Union ("EU"). They have been
prepared on a going concern basis with reference to the accounting policies
and methods of computation and presentation set out in the Group's
Consolidated financial statements for the year ended 30 September 2023.
The Interim Condensed consolidated financial statements do not include all the
information and disclosures required in the annual financial statements and
should be read in conjunction with the Group's audited financial statements
for the year ended 30 September 2023, which have been prepared in accordance
with International Financial Reporting Standards ("IFRS") as issued by the
International Accounting Standards Board ("IASB"), the interpretations issued
by the International Financial Reporting Interpretations Committee ("IFRIC")
and the requirements of Companies (Jersey) Law 1991.
The information relating to the six months ended 31 March 2024 is unaudited
and does not constitute statutory financial statements. The Group's
Consolidated financial statements for the year ended 30 September 2023 have
been reported on by the Group's auditor. The report of the auditor was
unqualified.
Consolidated financial statements
The consolidated financial statements incorporate the financial statements of
the Company and subsidiary entities controlled by the Company made up to 31
March 2024. Control is achieved where the Company is exposed, or has rights,
to variable returns from its involvement with an investee company and has the
ability to affect those returns through its power over the other entity; power
generally arises from holding a majority of voting rights.
Notes to the Consolidated Financial Statements
3. Operating Segments
Following the acquisitions of the subsidiaries, the Group now identifies three
principal operating segments, Investment and Fund Management (IFM) and
Advisory and Consultancy (AC), and International, and a number of plc and
group activities that have been aggregated into one operating segment.
IFM provides investment management services for individuals, trusts, sovereign
agencies and corporations, and fund management services to for a range of fund
vehicles. AC provides personal financial advice, investment consulting, and
treasury advisory services. Both segments are located in Jersey, Channel
Islands. International provides personal financial advice and insurance
services to expatriates predominantly in Asia and Africa.
No customer represents more than 10% of group revenues (FY 23: nil)
The following table represents revenue and cost information for the Group's
business segments
6 months ended 31 Mar 2024 Investment management Advisory and Consultancy International Group and consolidation adjustments Group
(unaudited)
£'000 £'000 £'000 £'000 £'000
Revenue 630 998 2,477 1 4,106
Direct Cost (209) (6) (1,261) (15) (1,490)
Contribution 421 992 1,216 (14) 2,5616
Indirect Costs (649) (1,025) (1,522) (412) (3,608)
Underlying (loss) before tax (228) (33) (305) (426) (992)
Amortisation of an acquired clients relationships - - - (497) (497)
Acquisition costs - - - (52) (52)
Deferred consideration fair value adjustments - - - 670 670
Interest payments (63) (63)
Net changes in the value of non-current asset - - - (79) (79)
(Loss) before tax (228) (33) (305) (447) (1,013)
Tax 4 - (1) - 3
Loss) for the period (223) (33) (307) (447) (1,010)
Notes to the Consolidated Financial Statements
3. Operating Segments (continued)
6 months ended 31 Mar 2023 Investment management Advisory Group and consolidation adjustments Group
(unaudited)
£'000 £'000 £'000 £'000
Revenue 511 1,548 (161) 1,898
Direct Cost (200) - (28) (228)
Contribution 311 1,548 (189) 1,670
Indirect Costs (715) (1,166) (163) (2,044)
Underlying (loss)/profit before tax (404) 382 (352) (374)
Amortisation of an acquired clients relationships - - (497) (497)
Changes in fair value - - (18) (18)
Realised gain on investments - - 452 452
Net changes in the value of non-current asset - - (69) (69)
(Loss)/profit before tax (404) 382 (484) (506)
Tax 43 (36) - 7
Profit/(loss) for the period (361) 346 (484) (499)
12 months ended 30 Sept 2023 (audited) Investment management Advisory International Group and consolidation adjustments Group
£'000 £'000 £'000 £'000
Revenue 951 3,039 1,332 1 5,323
Direct Cost (372) - (497) (55) (924)
Contribution 579 3,039 835 (54) 4,399
Indirect Costs (1,416) (2,052) (967) (651) (5,086)
Underlying (loss)/profit before tax (837) 987 (132) (705) (687)
Acquisition related costs - - - (222) (222)
Amortisation of an acquired clients relationships - - - (995) (995)
Interest payments - - - (35) (35)
Deferred consideration fair value adjustments - - - 1,680 1,680
Share award expense - - - (13) (13)
Net changes in the value of non-current asset - - - (171) (171)
(Loss)/profit before tax (837) 987 (132) (461) (443)
Tax (4) 5 (3) - (2)
Loss)/profit for the year (841) 992 (135) (461) (445)
Notes to the Consolidated Financial Statements
4. Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other
short-term highly liquid investments that are readily convertible to a known
amount of cash and are subject to an insignificant risk of change in value.
5. Deferred Consideration
As at As at As at
31 Mar 2024 31 Mar 2023 30 Sept 2023
£'000 £'000 £'000
Opening balance 4,621 2,649 2,649
Additions in the period 1,375 - 3,672
Deferred consideration paid/settled in period (2,891) (20) (20)
Adjustments in fair value during the period (670) (453) (1,680)
Closing balance 2,435 2,176 4,621
Deferred consideration split 31 Mar 2024 31 Mar 2023 30 Sept 2023
£'000 £'000 £'000
Equity consideration 997 973 1,263
Cash consideration 1,438 1,203 1,386
Total deferred consideration 2,435 2,176 2,649
Deferred consideration outstanding at the period end relates to the amounts
owed to the previous shareholders following the acquisitions of Omega
Financial Services Limited in the financial year ended 30 September 2022 and
NEBA Financial Services in the financial period ended 31 March 2024.
Additional deferred consideration in the period to 31 March 2024 relates to
the acquisition of the NEBA Financial Services group for £1,375,246.
During the period to 31 March 2024, £2,891,000 of deferred consideration was
settled via share capital issues to the previous shareholders of Concentric
Group Limited and Globaleye Group worth £655,000 and £2,236,000
respectively.
Amounts owed via equity settlement were revalued at the period end resulting
in a gain of £670,000.
Of the £2,435,000 due payable as at 31 March 2024, £1,115,000 is due payable
in more than one year.
Notes to the Consolidated Financial Statements
6. Goodwill
As at As at As at
31 Mar 2024 31 Mar 2023 30 Sept 2023
£'000 £'000 £'000
Opening balance 6,012 1,896 1,895
Acquisitions during the period 1,080 - 4,117
Closing balance 7,092 1,895 6,012
Goodwill is assessed annually for impairment and the recoverability will be
assessed as part of the full year financial statements and audit at 30
September 2024. Goodwill added during the period relates to the acquisition of
NEBA Financial Services.
7. Property, plant and equipment
Right of Equipment Computer Leasehold
use assets & fixtures Hardware Improvements Total
£'000 £'000 £'000 £'000 £'000
Cost
At 1 October 2023 800 67 81 2 950
Additions - - - - -
Disposals - - - - -
At 31 March 2024 800 67 81 2 950
Depreciation
At 1 October 2023 227 28 40 1 296
Disposals - - - - -
Charge for the year 63 14 2 - 89
At 31 March 2024 297 19 32 1 349
Carrying Amount
At 31 March 2024 503 25 39 2 567
At 30 September 2023 573 39 41 1 654
The right-to-use asset balance is made up of three properties across the
Group. The three properties are:
- 6 Caledonia Place, St Helier, Jersey, JE2 3NG. The lease term ends
on 30 April 2030.
- Ground Floor, 3 Mulcaster Street, St Helier, Jersey, JE2 3NJ. The
lease term ends on 23 March 2026.
- Third Floor, Conway House, St Helier, Jersey, JE2 3NT. The lease
term ends on 31 October 2027.
Notes to the Consolidated Financial Statements
8. Exceptional items
6 months ended 6 months ended 12 months ended
31-Mar-24 31-Mar-23 30 Sept 2023
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Acquisition related costs 52 - 222
52 - 222
9. Stated capital
As at As at As at
31 Mar 2024 31 Mar 2023 30 Sept 2023
No. No. No.
Allotted, called and fully paid shares
Ordinary shares 21,976,145 21,967,145 21,976,145
Deferred consideration shares issues 8,029,069 - -
30,005,214 21,967,145 21,976,145
As at As at As at
31 Mar 2024 31 Mar 2023 30 Sept 203
£'000 £'000 £'000
Stated capital
Opening balance 12,349 12,349 12,349
New Capital subscribed 2,851 - -
15,200 12,349 12,349
10. Related party transactions
Key management personnel are the same as the Directors.
There are no further related party transactions to be disclosed during the
year.
Notes to the Consolidated Financial Statements
11. Earnings per share
The Group has calculated the weighted-average number of outstanding ordinary
shares for the period as follows:
6 months ended 31 Mar 2023 Number of shares Time weighting Weighted average number of shares
Balance brought forward 21,976,145 6/6 21,976,145
21,976,145 6 months 21,976,145
12 months ended 30 Sept 2023 Number of shares Time weighting Weighted average number of shares
Balance brought forward 21,976,145 12/12 21,976,145
21,976,145 12 months 21,976,145
6 months ended 31 Mar 2024 Number of shares Time weighting Weighted average number of shares
Balance brought forward 21,976,145 6/6 21,976,145
Deferred consideration shares issues 8,029,069 5/6 6,690,891
30,005,214 6 months 28,667,036
The Parent Company does not have any contingent issuable shares as at year
end, hence diluted loss per share is the same as the basic loss per share
Notes to the Consolidated Financial Statements
11. Earnings per share (continued)
Loss per share As at As at As at
31 Mar 2024 31 Mar 2023 30 Sept 2023
Loss per share
(Loss) for the financial period and total comprehensive loss (£'000) (1,010) (499) (445)
Weighted average number of shares 28,667,036 21,976,145 21,976,145
Pence per share (3.5p) (2.3p) (2.0p)
Adjusted Loss per share As at As at As at
31 Mar 2024 31 Mar 2023 30 Sept 2023
£'000 £'000 £'000
Loss after tax (1,010) (499) (445)
Interest 64 18 35
Tax (4) (7) 2
Depreciation 79 69 171
Amortisation of intangible assets 497 497 995
Underlying (loss) before tax (374) (78) 758
Acquisition related expenses 52 - 222
Share award expenses - - 13
Fair value adjustments (670) - (1,680)
Adjusted underlying (loss) before tax (992) (374) (687)
As at As at As at
31 Mar 2024 31 Mar 2023 30 Sept 2023
Adjusted loss per share
Adjusted underlying loss before tax (992,000) (374,000) (687,000)
Weighted average number of shares 28,667,036 21,976,145 21,976,145
(Loss) in Pence per share (3.5p) (1.7p) (3.1p)
Notes to the Consolidated Financial Statements
12. Dividends
No interim dividend has been paid or proposed in respect of the current
financial period (2023: nil).
13. Events after the statement of financial position date
Following the year end and share authorities at the AGM on 17(th) April 2024,
an application was made to the London Stock Exchange for admission to trading
on AIM for an aggregate 9,549,300 new Ordinary Shares with trading effective
on 19(th) April 2024.
The breakdown of the new Ordinary Shares was as follows:
- 6,231,500 new Ordinary Shares pursuant to the Placing,
Subscription and WRAP Retail Offer, which raised £1.3 million for the Group
- 3,281,250 new Ordinary Shares pursuant to conversion of the
£1.181m nil coupon convertible loan issued to John Beverley as initial
consideration for the acquisition of Neba Financial Solutions Ltd and Neba
Financial Solutions Private Ltd, announced on 12 December 2023
- 36,550 new Ordinary Shares pursuant to the vesting of the initial
third of the Executive Director bonus awards for the financial period to 30
September 2022 ("Awards"), comprising 13,158 new Ordinary Shares to Mark
Clubb, Executive Chair, and 23,392 new Ordinary Shares to Matthew Moore, Chief
Financial Officer.
In addition, a further £500,000 was raised through the subscription for
unsecured convertible loan notes at par value by Growth Financial Services, a
Harwood Capital Management LLP subsidiary.
Notes to the Consolidated Financial Statements
Company number
129405
Nominated Adviser
Strand Hanson Limited
26 Mount Row,
London
W1k 3SQ
Corporate broker
Oberon Investments Limited
Nightingale House,
65 Curzon Street,
London
W1J 8PE
Financial adviser
H&P Advisory Limited
2 Park Street
London
W1K 2HX
Bankers
HSBC Bank plc
15-17 King Street
Jersey
JE2 4WF
Registered office
6 Caledonia Place
St Helier
Jersey
JE2 3NG
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