REG - W.H. Ireland Group - Half Yearly Report - Replacement <Origin Href="QuoteRef">WHI.L</Origin>
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RNS Number : 5456T
W.H. Ireland Group PLC
20 July 2015
The following amendments have been made to the Half Year Results announcement
released on 20 July 2015 at 7.00am under RNS No 4414T.
In Note 2 Segmental reporting, in the table representing revenue and profit
information for the Group's business segments for the half year ended 31 May
2015, all figures marked with an asterisk have been amended.
All other details remain unchanged.
The full amended text is shown below.
Monday, 20 July 2015
WH Ireland Group plc
("WH Ireland", "the Group" or "the Company")
Half Year Results
WH Ireland, the financial services group that provides corporate broking and
private wealth management services, today announces its results for its half
year ended 31 May 2015.
Highlights
· Group revenue increased 9% to £15.94m (2014: £14.69m)
o 34% increase in recurring revenues to £5.13m (2014: £3.83m)
· Operating profit of £0.31m (2014: £0.12m)
· Profit before tax of £0.59m (2014: £0.20m)
· Basic earnings per share of 1.86p (2014: 0.58p)
Private Wealth Management
· Total funds under management and control of £2.8bn up 3.7% from year
end (30 November 2014: £2.7bn)
o Strong increase in discretionary assets under management of 16% to £0.83bn
(30 November 2014: £0.72bn)
· Management fee income increased by 55% to £3.4m (2014: £2.2m)
Corporate Broking
· Further growth in number of retained corporate clients to 98 (2014:
92)
· Retainer fee income rose by 7% to £1.68m (2014: £1.57m)
· Increased flow of secondary placings with 15 transactions completed
Richard Killingbeck, Chief Executive, said:
"We have reported an improved and profitable first half performance with
increased discretionary funds under management in Private Wealth Management
and increased numbers of clients in Corporate Broking.
"The actions we have taken in order to achieve the margins that the Company is
capable of producing will begin to benefit the second half and beyond. We
remain cautiously optimistic and look forward to the next six months with
confidence."
For further information please contact:
WH Ireland Group plc www.wh-ireland.co.uk
Richard Killingbeck, Chief Executive OfficerMiles Nolan, Head of Communications +44(0) 20 7220 1666
SPARK Advisory Partners Limited
Mark Brady/Miriam Greenwood +44(0) 20 3368 3551/3550
MHP Communications
Reg Hoare / Jade Neal / Jamie Ricketts +44(0) 20 3128 8100
whireland@mhpc.com
Chairman's Statement
Introduction
It is pleasing to report a profitable first half to the year with further
progress being made in most areas of our business. There remains a
considerable amount of work to be done if we are to achieve the returns that
the Board believes the Company is capable of producing but, under difficult
market conditions, it is reassuring to see our recurring revenues growing
strongly.
Dividend
In line with previous years, the Board is continuing with its policy of only
recommending the payment of a final dividend in respect of its financial year
end; this will be declared at the time of the 2014/5 results announcement in
February 2016.
Conclusion
The second half of the year will face the headwind of various macro-economic
uncertainties. Currently the most topical are the volatile market conditions
in China and the demise of the Greek economy with the attendant uncertainty
about her continued participation in the Euro experiment. Nevertheless the
cautious optimism that I expressed at the year-end remains appropriate and we
look forward to the next six months with confidence.
Rupert Lowe
Chairman
Chief Executive's Statement
Overview
The first six months of the year has witnessed considerable progress in both
of our divisions in delivering our stated ambition of achieving a greater
share of our revenue from recurring revenue streams.
The Private Wealth Management division has continued to grow its management
fee income with an increase of over 50% being achieved when compared with the
same period last year. This growth reflects the continued focus on
discretionary and advisory fee paying assets from both new and existing
clients.
Within the Corporate Broking division continuing growth in the number of
corporate clients has resulted in further increases to retainer income and a
consequential increase in the number of client-related corporate transactions
undertaken during the first half.
Outlook
Despite this solid progress, there remains a lot of work to be undertaken in
order to achieve the gross margin levels and returns that the Chairman refers
to above. The rationalisation of office locations and reductions in the cost
base will begin to have a positive impact in the second half of our financial
year. Further, we are continuing to focus a significant amount of time and
effort in bringing efficiencies to bear within our operational platform whilst
at the same time ensuring that we have the ability to service our growing
discretionary client base. Various internal projects have begun this year
which will take some time to be completed but which should begin to benefit
the business in 2016 and beyond.
Richard Killingbeck
Chief Executive Officer
Consolidated statement of comprehensive income - unaudited
for the half year ended 31 May 2015 Half year Half year Year
ended ended ended
31 May 31 May 30 November
2015 2014 2014
(audited)
Note £'000 £'000 £'000
Revenue 2 15,942 14,691 30,043
Administrative expenses (15,626) (14,564) (29,353)
Operating profit 316 127 690
Other income - - 12
Investment (losses)/gains (98) (2) (2)
Fair value gains/(losses) on investments 385 87 (221)
Finance income 16 14 25
Finance expense (26) (23) (48)
Profit before tax 593 203 456
Tax expense (141) (64) (119)
Profit and total comprehensive income for the period 452 139 337
Earnings per share for profit attributable to the ordinary equity holders of the parent during the period
Basic 6 1.86p 0.58p 1.42p
Diluted 6 1.82p 0.55p 1.34p
Consolidated statement of financial position - unaudited
as at 31 May 2015 31 May 31 May 30 November
2015 2014 2014
(audited)
Note £'000 £'000 £'000
Assets
Non-current assets
Property, plant and equipment 5,500 5,700 5,595
Goodwill 258 319 258
Intangible assets 3,502 476 463
Investments 3 456 532 579
Deferred tax asset 350 375 360
10,066 7,402 7,255
Current assets
Trade and other receivables 20,919 33,098 38,345
Trading investments 261 1,180 890
Cash and cash equivalents 4 5,903 8,643 7,490
27,083 42,921 46,725
Totalassets 37,149 50,323 53,980
Liabilities
Current liabilities
Trade and other payables (17,685) (34,191) (37,919)
Corporation tax payable (443) (192) (308)
Obligations under finance leases (119) (119) (119)
Borrowings (174) (175) (179)
Provisions for liabilities and charges (45) (412) (189)
(18,466) (35,089) (38,714)
Non-current liabilities
Deferred tax liability (205) (393) (205)
Obligations under finance leases (50) (159) (109)
Accruals and deferred income (3,461) (363) (347)
Borrowings (1,081) (1,255) (1,169)
Provisions for liabilities and charges (35) (21) (21)
(4,832) (2,191) (1,851)
Total liabilities (23,298) (37,280) (40,565)
Total net assets 13,851 13,043 13,415
Equity
Share capital 5 1,222 1,192 1,193
Share premium 343 95 101
Available-for-sale reserve 7 7 7
Other reserves 982 982 982
Retained earnings 12,033 11,549 11,895
Treasury shares (736) (782) (763)
Total equity 13,851 13,043 13,415
Consolidated statement of cash flows - unaudited
for the half year ended 31 May 2015
Half year Half year Year
ended ended ended
31 May 31 May 30 November
2015 2014 2014
(audited)
£'000 £'000 £'000
Operating activities:
Profit for the period 452 139 337
Adjustments for:
Depreciation, amortisation and impairment 169 235 474
Finance income (16) (14) (25)
Finance expense 26 23 48
Taxation 141 64 119
Gain in investments (363) (155) (202)
Non-cash adjustment for share based payments 108 99 205
Decrease/(increase) in trade and other receivables 17,425 3,594 (1,653)
(Decrease)/increase in trade and other payables* (20,172) (554) 3,158
(Decrease)/increase in provisions (130) 68 (155)
Decrease/(increase) in trading investments 629 (333) (43)
Net cash (used in)/generated from operations (1,731) 3,166 2,263
Income taxes received/(paid) 4 - (112)
Net cash (used in)/generated from operating activities (1,727) 3,166 2,151
Investing activities*:
Proceeds from sale of investments 646 70 70
Interest received 16 14 25
Acquisition of investments (160) - -
Acquisition of property, plant and equipment (60) (201) (261)
Net cash generated from investing activities 442 (117) (166)
Financing activities:
Proceeds from issue of shares 313 96 132
Repayment of borrowings (93) (59) (181)
Repayment of obligations under finance leases (48) (99) (102)
Interest paid (26) (23) (48)
Interest paid: Finance leases (11) (10) (17)
Dividends paid (437) (357) (325)
Net cash used in financing activities (302) (452) (541)
Net (decrease)/increase in cash and cash equivalents (1,587) 2,597 1,444
Cash and cash equivalents at beginning of period 7,490 6,046 6,046
Cash and cash equivalents at end of period 5,903 8,643 7,490
Cash and cash equivalents at the end of the period comprise of:
Clients' settlement cash 107 4,895 172
Group cash 5,796 3,748 7,318
Cash and cash equivalents at end of period 5,903 8,643 7,490
*The investing activities and movement in trade and other payables for the
half-year ended 31 May 2015, do not include the acquisition of intangibles for
deferred payments of £3.05m, treated as a non cash item.
Consolidated statement of changes in equity - unaudited Available
Share Share for-sale Other Retained Treasury Total
capital premium reserve reserves earnings shares equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 December 2013 1,185 6 7 982 11,668 (782) 13,066
Profit and total comprehensive income for the period - - - - 139 - 139
Contributions by and distributions to owners
Recognition of share-based payments - - - - 99 - 99
Share options exercised 7 89 - - - - 96
Dividends (note 7) - - - - (357) - (357)
Total contributions by and distributions to owners 7 89 - - (258) - (162)
Balance at 31 May 2014 1,192 95 7 982 11,549 (782) 13,043
Profit and total comprehensive income for the period - - - - 198 - 198
Contributions by and distributions to owners
Recognition of share-based payments - - - - 106 - 106
Share options exercised 1 6 - - 10 19 36
Dividends (note 7) - - - - 32 - 32
Total contributions by and distributions to owners 1 6 - - 148 19 174
Balance at 30 November 2014 1,193 101 7 982 11,895 (763) 13,415
Profit and total comprehensive income for the period - - - - 452 - 452
Contributions by and distributions to owners
Recognition of share-based payments - - - - 108 - 108
Share options exercised 29 242 - - 15 27 313
Dividends (note 7) - - - - (437) - (437)
Total contributions by and distributions to owners 29 242 - - (314) 27 (16)
Balance at 31 May 2015 1,222 343 7 982 12,033 (736) 13,851
for the half year ended 31 May 2015
Notes to the interim report and financial information
for the half year ended 31 May 2015
1. Basis of preparation
Statement of compliance
The financial information in this interim report has been prepared in
accordance with the disclosure requirements of the Alternative Investment
Market ("AIM") Rules and the recognition and measurements of International
Financial Reporting Standards (IFRS), as adopted by the European Union (EU).
The interim report does not include all of the information required for full
annual financial statements.
The accounting policies adopted by the Group in the preparation of its 2015
interim report are those which the Group currently expects to adopt in its
annual financial statements for the year ending 30 November 2015 and are
consistent with those disclosed in the annual financial statements for the
year ended 30 November 2014.
The financial information for the period ended 31 May 2015 does not constitute
the Company's statutory accounts. The statutory accounts for the year ended
30 November 2014 have been delivered to the Registrar of Companies in England
and Wales. The auditor has reported on those accounts. Its report was
unqualified, did not draw attention to any matters by way of emphasis, and did
not contain a statement under Section 498(2) or 498(3) of the Companies Act
2006. The financial information for the half year ended 31 May 2015 and 31
May 2014 is unaudited.
The AIM Rules for Companies do not require IAS 34 "Interim Financial
Reporting" to be applied; therefore it has not been used in the preparation of
this interim report.
Going concern
The financial statements of the Group have been prepared on a going concern
basis. In making this assessment, the Directors have prepared detailed
financial forecasts for the period to November 2017 which consider the funding
and capital position of the Group. Those forecasts make assumptions in
respect of future trading conditions, notably the economic environment and its
impact on the Group's revenues and costs. In addition to this, the nature of
the Group's business is such that there can be considerable variation in the
timing of cash inflows. The forecasts take into account foreseeable downside
risks, based on the information that is available to the Directors at the time
of the approval of these financial statements.
Certain activities of the Group are regulated by the Financial Conduct
Authority (FCA) which is the statutory regulator for financial services
business in the UK and has responsibility for policy, monitoring and
discipline for the financial services industry. The FCA requires the Group's
capital resources to be adequate; that is sufficient in terms of quantity,
quality and availability, in relation to its regulated activities. The
Directors monitor the Group's regulatory capital resources on a daily basis
and they have developed appropriate scenario tests and corrective management
plans which they are prepared to implement to address any potential deficit as
required. These actions may include cost reductions, regulatory capital
optimisation programmes or further capital raising. The Directors consider
that, taking account of foreseeable downside risks, regulatory capital
requirements will continue to be met.
The Directors have renewed the Group's banking facilities, confirming that
these will be available until 28 February 2016.
2. Segmental reporting
The Group has two operating segments.
The Private Wealth Management division offers investment management advice and
services to individuals and contains the Group's Wealth Planning business,
giving advice on and acting as intermediary for a range of financial products.
The Corporate Broking division provides corporate finance and corporate
broking advice and services to companies and acts as Nominated Adviser to
clients listed on AIM. It also contains the Group's Institutional Sales and
Research business, which carries out stockbroking activities on behalf of
companies as well as conducting research into markets of interest to its
clients.
All divisions are located in the UK or the Isle of Man. Each reportable
segment has a segment manager who is directly accountable to and maintains
regular contact with the CEO.
No customer represents more than ten percent of the Group's revenue.
The following tables represent revenue and profit information for the Group's
business segments:
Half year ended 31 May 2015
Private Wealth Corporate Head Other Group
Management Broking Office Companies Group
£'000 £'000 £'000 £'000 £'000
Revenue 10,915 4,869 - 158 15,942
Segment result 501 (283) - 98 316
Executive Board cost 169 169 (454) 116 -
Other Income - - - - -
Investment gains (8) (90) - - (98)
Fair value gains/(losses) on investments (11) 396 - - 385
Finance income 15 - - 1 16
Finance expense (11) (4) - (11) (26)
Profit/(loss) before tax 655 189 (454) 203 593
Tax (expense)/income (22) (130) - 11 (141)
Profit/(loss) for the year 633* 59* (454) 214* 452*
Half year ended 31 May 2014
Private Wealth Corporate Head Other Group
Management Broking Office Companies Group
£'000 £'000 £'000 £'000 £'000
Revenue 10,077 4,540 - 74 14,691
Segment result 326 (118) - (81) 127
Executive Board cost 188 188 (476) 100 -
Other Income - - - - -
Investment losses - (2) - - (2)
Fair value gains on investments - 87 - - 87
Finance income 12 1 - 1 14
Finance expense (8) (3) - (12) (23)
Profit/(loss) before tax 518 153 (476) 8 203
Tax (expense)/income (17) (96) - 49 (64)
Profit/(loss) for the year 501 57 (476) 57 139
Year ended 30 November 2014 (audited)
Private Wealth Corporate Head Other Group
Management Broking Office Companies Group
£'000 £'000 £'000 £'000 £'000
Revenue 20,328 9,538 - 177 30,043
Segment result 229 616 - (155) 690
Executive Board cost 347 347 (897) 203 -
Other Income 12 - - - 12
Investment losses - (2) - - (2)
Fair value losses on investments (24) (197) - - (221)
Finance income 22 1 - 2 25
Finance expense (17) (6) - (25) (48)
Profit/(loss) before tax 570 759 (897) 25 456
Tax (expense)/income (31) (181) - 93 (119)
Profit/(loss) for the year 539 578 (897) 118 337
3. Investments
Half year Half year Year
ended ended ended
31 May 31 May 30 November
2015 2014 2014
(audited)
£'000 £'000 £'000
Available-for-sale investments
Fair value: unquoted 93 247 93
93 247 93
Investments at fair value through the income statement
Fair value: quoted 196 41 284
warrants 167 244 202
363 285 486
Total investments 456 532 579
Fair value, in the case of quoted investments, represents the bid price at the
reporting date. In the case of unquoted investments, the fair value is
estimated by reference to recent arm's length transactions. The fair value of
warrants is estimated using established valuation models.
4. Cash, cash equivalents and bank overdrafts
For the purposes of the statement of cash flows, cash and cash equivalents
comprise cash in hand and deposits with banks and financial institutions with
a maturity of up to three months.
Cash and cash equivalents represent the Group's and the Company's money and
money held for settlement of outstanding transactions.
Money held on behalf of clients is not included in the statement of financial
position. Client money at 31 May 2015 was £130.8m (31 May 2014: £101.6m; 30
November 2014: £107.2m).
5. Share capital
The total number of authorised ordinary shares is 34.5 million shares of 5p
each (31 May 2014 and 30 November 2014: 34.5 million). The total number of
issued ordinary shares is 24.4 million shares of 5p each (31 May 2014: 23.8
million and 30 November 2014: 23.9 million).
6. Earnings per share
Basic earnings per share (EPS) is calculated by dividing the profit
attributable to equity holders of the Company by the weighted average number
of ordinary shares in issue during the year, excluding ordinary shares
purchased by the Company and held as treasury shares.
Diluted EPS is the basic EPS, adjusted for the effect of conversion into fully
paid shares of the weighted average number of all dilutive employee share
options outstanding during the period. 34,838 options over shares are
excluded from the EPS calculation. At 31 May 2014: nil and 30 November 2014:
nil options were excluded from the EPS calculation as they were anti-dilutive.
Anti-dilutive options represent options issued where the exercise price is
greater than the average market price for the period.
Reconciliations of the earnings and weighted average number of shares used in
the calculations are set out below:
Half year Half year Year
ended ended ended
31 May 31 May 30 November
2015 2014 2014
(audited)
'000 '000 '000
Weighted average number of shares in issue during the period 24,268 23,763 23,763
Effect of dilutive share options 611 1,243 1,308
24,879 25,006 25,071
£'000 £'000 £'000
Earnings attributable to ordinary shareholders 593 139 337
Basic EPS
Continuing operations 2.44p 0.58p 1.42p
Diluted EPS
Continuing operations 2.38p 0.55p 1.34p
7. Dividends
A final dividend of 2.0p per share, in respect of the year ended 30 November
2014, was approved by shareholders at the Annual General Meeting held on 26
March 2015. This was subsequently paid on 10 April 2015. No interim dividend
has been paid or proposed in respect of the current financial year (2014:
nil).
8. Contingent liabilities
In April 2014, the FCA instigated an investigation into WH Ireland Limited,
the principal operating subsidiary of
WH Ireland Group plc, in respect of its control procedures required by
Principle 3 of the FCA Rules of Business. The investigation is in relation to
the period between 1st January 2013 until 19th June 2013.
The Directors continue to cooperate fully with the FCA and are in ongoing
dialogue in the hope of seeking clarity and timely resolution of the matter.
There is insufficient information at the date of these financial statements to
allow the Board to make a reliable estimate of the effect on the Group's
financial position. The Directors have therefore made no provision in these
financial statements in respect of this matter.
9. Availability of Interim Report
Copies of this Report and the Company's shareholder presentation can be
downloaded from the Company's website at www.wh-ireland.co.uk.
This information is provided by RNS
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