TIDMAFHP TIDMTTM
RNS Number : 0915Q
AFH Financial Group Plc
04 June 2018
4 June 2018
AFH Financial Group PLC ("AFH" or the "Company")
Results for the six months ended 30 April 2018
AFH reports further strong revenue and margin growth
AFH, a leading financial planning led wealth management firm, is
pleased to announce its results for the six months ended 30 April
2018.
Strong growth
-- Revenues up 63% to GBP22.7 million (H1 2017: GBP13.9 million)
-- Underlying EBITDA* up 118% to GBP4.43 million (H1 2017: GBP2.03 million)
-- Underlying EBITDA* margin increased to 19.5% (H1 2017: 14.6%)
-- Profit after tax up 177% to GBP2.5 million (H1 2017: GBP0.9 million)
-- Statutory Earnings per share up 85% to 6.85 pence (H1 2017: 3.71 pence)
-- Underlying Earnings per share* up 62% to 9.98 pence (H1 2017: 6.17 pence)
-- Funds under Management above GBP3.2bn, up 45% (H1 2017: GBP2.2bn)
*Underlying excludes amortisation of intangible assets arising
on business combinations and the non-cash charge/credit for share
based payment costs.
Confident Outlook
-- Strong balance sheet to support further acquisitions
-- Cash reserves of GBP23.7million, following on from successful
GBP17.5 million placing (30 April 2017: GBP12.6 million)
-- Regulatory dynamics continue to support further industry consolidation
-- Proven acquisition methodology
-- Strong pipeline of acquisition opportunities
Alan Hudson, Group Chief Executive, commented:
"I am pleased to report another six month period of increased
turnover and trading margins based on organic growth from new and
existing clients.
The business saw further growth over the period with
profitability increasing at both EBITDA and EPS levels. At the
start of FY17, the Board set an aspiration to achieve an underlying
EBITDA margin of 20% within a three-to-five year period and the
Company remains significantly ahead of that timeframe.
The strategy of the Company continues to be to generate long
term value for shareholders by providing exceptional value and
service to our clients and using our increasing size to drive down
platform and fund management charges aligned to an appropriate risk
based investment model."
For further information please contact:
AFH Financial Group PLC 01527 577 775
Alan Hudson, Chief Executive Officer
Paul Wright, Chief Financial Officer
Liberum (Nominated Adviser and Broker) 020 3100 2000
John Fishley
Richard Bootle
This announcement is released by AFH Financial Group plc and
contains inside information for the purposes of Article 7 of the
Market Abuse Regulation (EU) 596/2014 (MAR), and is disclosed in
accordance with the Company's obligations under Article 17 of
MAR.
For the purposes of MAR and Article 2 of Commission Implementing
Regulation (EU) 2016/1055, this announcement is being made on
behalf of the Company by Paul Wright, Chief Financial Officer.
Chief Executive's Review
Business review
I am pleased to report another six month period of increased
turnover and trading margins based on organic growth from new and
existing clients. New Funds under Management have been invested at
a rate of GBP35 million per month. During the period the Company
completed and integrated six acquisitions which have brought a
further GBP270 million of investment portfolios and are expected to
be earnings enhancing in the second half of the year and
thereafter.
Our two divisions both produced revenue growth with enhanced
margins during the period which enabled the consolidated group to
report an increase in the underlying EBITDA margin to 19.5%. At the
start of FY17, the Board set an aspiration to achieve an underlying
EBITDA margin of 20% within a three-to-five year period and the
Company remains significantly ahead of that timeframe.
Funds under Management exceeded GBP3.2 billion at the period
end, representing a 45% increase over the April 2017 level.
The institutional fundraising which closed in December 2017 has
provided the Company with the ability to undertake a number of
strategic and tactical acquisitions during the remainder of the
year and into 2019. At the period end the Company retained over
GBP23.7 million in cash against a regulatory requirement of GBP2.5
million. Despite the increased share count as a result of the
fundraising I am pleased to report an increase in earnings per
share of 85%with the opportunity to make further earnings enhancing
acquisitions in the future.
Trading results
The business saw further organic growth over the period with
profitability increasing at both EBITDA and EPS levels. Revenue for
the period increased to GBP22.7 million (H1 2017: GBP13.9 million),
underpinned by ongoing recurring fees. These increased by 38% and
represented 59% of total revenue during the period; driven by new
business in both our Wealth Management and Protection broking
operations.
Revenue from acquisitions reported during the current period
totaled GBP2.6 million and represented 11% of total revenue for the
period.
The increased revenue together with the economies of scale
generated by the business enabled the Company to report underlying
EBITDA of GBP4.43 million, an increase of 117% over the same period
last year (GBP2.03 million).
I am pleased to report an increase of 62% in underlying earnings
per share to 9.98p per share (2017: 6.17p) whilst statutory
earnings per share increased to 6.85p per share (2017: 3.71p).
Financial Advisory and investment management
Financial advisory and the subsequent management of client
portfolios continued to represent the core business of AFH based on
the simple philosophy that the most appropriate way to manage a
client's portfolio is to fully understand their current and future
financial aims, their attitude to risk and their lifestyle
requirements before constructing appropriate personal models and
finally managing their money to meet their objectives.
During the period our initial financial planning fees totalled
GBP5.6 million, an increase of GBP1.5 million (37%), reflecting the
expanding client base and increasing client requirements for
financial planning driven by new legislation as well as changing
lifestyle needs.
Ongoing management fees increased to GBP13.2 million (2017:
GBP9.8 million), reflecting the growing funds under management
which, as set out below, increased to GBP3.2 billion as a result of
net organic inflows together with assets attached to acquisitions
during the year.
Annualised revenue per adviser in our core business increased to
GBP220,000 (H1 2017 GBP180,000).
Gross margins in our core business remained at 55%, reflecting
the stable level of business generated centrally relative to that
self-generated by our advisers.
The division generated EBITDA of GBP4.4m (2017: GBP3.1m),
representing a 23.4% margin on revenue (2017: 22.3%) and
demonstrating the benefits of scale that has been achieved by the
strategy adopted by the Company since joining the AIM.
Protection broking
The Eunisure business traded above expectations during the
period, reporting strong growth in both revenues and margins since
the business was acquired in June 2017.
In March 2018 Eunisure started to transition part of its
business from an indemnity to a non- indemnity basis using the
financial strength of the AFH Financial Group to support the move.
This is expected to have a positive impact on future revenue flows
and to improve the EBITDA margin of the business above the
traditional sector levels.
During the period the division generated revenues of GBP3.9
million from which EBITDA of GBP1.3 million was derived.
We continue to view this sub sector of the market as underserved
and providing a significant opportunity for the future.
Acquisitions
The market for acquisitions within the IFA sector continued to
be buoyant and whilst some upward pressure on prices was seen in
larger businesses, where competition from private equity and
product providers has increased, we were able to close a number of
transactions at our traditional multiples and in line with our earn
out model. Our pipeline remains strong with a number of
opportunities in due diligence and contract negotiations at the
period end.
During the period we completed six acquisitions for an initial
consideration of GBP3.2 million, encompassing both retiring IFAs,
whose client portfolios have been transitioned to existing AFH
advisers, as well as larger organisations whose clients and
advisers have been absorbed into the AFH model. This model
continues to allow clients' portfolios to be retained on existing
platforms and products where appropriate but enables them to move
to our cost-effective discretionary service where a clear benefit
to the client can be demonstrated. Future deferred consideration of
up to GBP3.5 million is payable on these acquisitions over the next
two financial years depending on their achievement of financial
targets.
Integration of acquisitions made during the period has been
completed successfully and I am pleased to report that businesses
acquired in previous periods continue to trade in line with our
expectations. During the period we again paid deferred
consideration, based on the profitability of the acquired
businesses, in excess of 90% of the expectation, including a growth
opportunity, set at the time of acquisition across the
portfolio.
Whilst AFH has a strategy of continuing to increase the average
size of its acquisitions, the Company also remains committed to
providing an exit for retiring IFAs where our existing advisers can
offer the full AFH service to the acquired client base. As a
result, the Board expects to announce both strategic and tactical
acquisitions in the future.
Funds under management
Funds under management increased by GBP0.41 billion during the
period, driven by new monies invested and acquired portfolios. The
fall in the markets that occurred in February and March 2018 was
cushioned for our clients by the investment strategy for our funds
and represented less than a 0.4% impact during the period.
Funds under management GBPbillion
Reported as at 1 November
2017 2.79
----------------------------------
Inflows through acquisitions 0.27
----------------------------------
Inflows from existing
business 0.21
----------------------------------
Market impact (0.01)
----------------------------------
Outflows and drawdowns (0.06)
----------------------------------
Balance as at 30 April
2018 3.2
----------------------------------
Inflows from existing business continued to be predominantly
invested on a discretionary mandate and again showed annualised
double digit growth.
December fundraising
During the period the Company raised GBP17.5 million gross
(GBP16.8 million after expenses) in an institutional fundraising
that I am pleased to report was oversubscribed. The creation of 7
million new ordinary shares represented a 23% increase in the
issued share capital of the Company and in addition to introducing
a number of new institutions to the register was supported by
existing major institutional shareholders. The fundraising has
already provided the financial strength to complete a number of
acquisitions during the current financial year
Cash position
The Group remains free of bank or secured debt, with the
exception of a small property mortgage, and maintains healthy cash
balances. Following the December fundraising, cash and cash
equivalents at period end totalled GBP23.7 million. Unsecured
non-convertible bonds of GBP0.75 million and GBP2.14 million mature
in 2020 and December 2018 respectively. As noted above, the
Company's regulatory requirement is GBP2.5 million.
Outlook
The strategy of the Company continues to be to generate long
term value for shareholders by providing exceptional value and
service to our clients and using our increasing size to drive down
platform and fund management charges aligned to an appropriate risk
based investment model. We believe that this is the most
sustainable model for the future of the sector, aligning clients'
interests with those of shareholders to secure long term growth and
profitability, and in line with the current objectives of the
regulator.
The Company remains profitable and cash generative, and during
the period further strengthened its balance sheet. Our model
remains to expand our distribution capacity through both organic
and acquisitive growth whilst maintaining centralised investment,
advice and compliance functions to drive increased profitability
and shareholder value.
The Directors believe that the expansion of our financial
planning products and scope is in the best interests of both our
shareholders and clients and whilst maintaining a focus on the IFA
market the Company continues to actively seek appropriately priced
acquisition opportunities in the wider advisory and wealth
management sector with a comparable culture to AFH.
The progress made during the first half of the current financial
year, combined with the growth dynamics of our market, allow the
Directors to view the prospects for the full year and beyond with
confidence.
Alan Hudson
Chief Executive
4 June 2018
Consolidated Statement of Comprehensive Income
Unaudited Unaudited Audited
Six months Six months Twelve months
ending 30 ending 30 ending 31
April 2018 April 2017 October 2017
Note GBP'000 GBP'000 GBP'000
Revenue 3 22,706 13,865 33,639
Cost of sales (10,625) (6,055) (15,672)
-------------- -------------- --------------
Gross profit 12,081 7,810 17,967
Administrative expenses before
amortisation and depreciation
and share based payments
expenses (7,655) (5,781) (12,320)
-------------- -------------- --------------
Underlying EBITDA 4,426 2,029 5,647
Amortisation and Depreciation 1,048 689 1,778
Non cash share based payments 72 72 136
-------------- -------------- --------------
Operating profit 3,306 1,268 3,733
Finance income 40 6 19
Finance costs (122) (123) (245)
-------------- -------------- --------------
Profit before tax 3,224 1,151 3,507
Income tax expense (733) (230) (444)
-------------- -------------- --------------
Profit for the year attributable
to owners of the parent 2,491 921 3,063
Other comprehensive income - - -
-------------- -------------- --------------
Total comprehensive income
for the year attributable
to owners of the parent 2,491 921 3,063
Earnings per share (in pence) 9
Basic 6.85 3.71 11.22
Diluted 6.32 3.38 10.31
Underlying EBITDA adjusted
for tax per share (in pence) 9
Basic 9.98 6.17 16.97
Diluted 9.20 5.61 15.58
All results derive from continuing operations
Consolidated Statement of Financial Position
Unaudited Unaudited Audited
30 April 30 April 31 October
2018 2017 2017
Note GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Intangible assets 4 44,734 25,157 38,930
Property, plant and equipment 1,206 1,533 1,195
Investments 1 1 1
Deferred tax asset 28 43 28
-------------- -------------- --------------
45,969 26,734 40,154
Current assets
Trade and other receivables 5 7,903 5,108 6,015
Cash and cash equivalents 23,725 12,576 9,275
-------------- -------------- --------------
31,628 17,684 15,290
-------------- -------------- --------------
Total assets 77,597 44,418 55,444
Liabilities
Current liabilities
Trade and other payables 7 12,059 7,052 11,502
Current tax liabilities 922 445 468
Financial liabilities -
Borrowings 6 2,220 77 77
-------------- -------------- --------------
15,201 7,574 12,047
Net current assets /
(liabilities) 16,427 10,110 3,243
-------------- -------------- --------------
Non-current liabilities
Trade and other payables 7 7,996 2,476 6,736
Financial liabilities -
Borrowings 6 1,103 3,317 3,281
Provision 297 - 49
-------------- -------------- --------------
9,396 5,793 10,066
Total liabilities 24,597 13,367 22,113
-------------- -------------- --------------
Net assets 53,000 31,051 33,331
Shareholders' equity
Share capital 8 3,782 3,008 3,058
Share premium account 8 40,605 23,299 24,224
Merger reserve (540) (540) (540)
Share-based payment reserve 703 566 630
Retained earnings 8,450 4,718 5,959
-------------- -------------- --------------
Total Shareholders' equity 53,000 31,051 33,331
Consolidated Statement of Changes in Equity
Share Share premium Merger Share-based Retained Total
capital reserve payment earnings
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Audited
balance at
31 October
2016 2,413 13,989 (540) 494 3,797 20,153
------------ ------------ ------------ ------------ ------------ ------------
Profit for the
period - - - 72 921 993
Other
comprehensive
income - - - - - -
------------ ------------ ------------ ------------ ------------ ------------
Total
comprehensive
income - - - 72 921 993
------------ ------------ ------------ ------------ ------------ ------------
Issue of share
capital 595 9,310 - - - 9,905
Dividend
------------ ------------ ------------ ------------ ------------ ------------
Unaudited
balance
at 30 April
2017 3,008 23,299 (540) 566 4,718 31,051
------------ ------------ ------------ ------------ ------------ ------------
Profit for the
period - - - 64 1,241 1,305
Other
comprehensive
income - - - - - -
------------ ------------ ------------ ------------ ------------ ------------
Total
comprehensive
income - - - 64 1,241 1,305
------------ ------------ ------------ ------------ ------------ ------------
Issue of share
capital 50 925 - - - 975
Dividend
------------ ------------ ------------ ------------ ------------ ------------
Audited
balance at
31 October
2017 3,058 24,224 (540) 630 5,959 33,331
------------ ------------ ------------ ------------ ------------ ------------
Profit for the
period - - - 73 2,491 2,564
Other
comprehensive
income - - - - - -
------------ ------------ ------------ ------------ ------------ ------------
Total
comprehensive
income - - - 73 2,491 2,564
------------ ------------ ------------ ------------ ------------ ------------
Issue of share
capital 724 16,381 - - - 17,105
Dividend
------------ ------------ ------------ ------------ ------------ ------------
Unaudited
balance
at 30 April
2018 3,782 40,605 (540) 703 8,450 53,000
------------ ------------ ------------ ------------ ------------ ------------
Consolidated Statement of Cash Flows
Unaudited Unaudited Audited
Six months Six months Twelve months
ending 30 ending 30 ending 31
April April October
2018 2017 2017
Note GBP'000 GBP'000 GBP'000
Cash flows from operating activities
Cash generated from operations 10 3,518 1,455 5,704
Tax paid (337) (103) (351)
-------------- -------------- --------------
Net cash inflow from operating activities 3,181 1,352 5,353
-------------- -------------- --------------
Cash flows from investing activities
Purchase of property, plant and
equipment (151) (450) (265)
Purchase of other intangible assets,
net of cash (5,251) (4,495) (11,141)
Interest received 40 6 19
-------------- -------------- --------------
Net cash (outflow) from investing
activities (5,362) (4,939) (11,387)
-------------- -------------- --------------
Cash flows from financing activities
Proceeds from issue of shares 17,552 10,021 10,022
Share issue costs (712) (412) (412)
Proceeds from finance leasing - - 255
Repayment of borrowings (85) (35) (121)
Interest paid (124) (128) (251)
Dividends - - (901)
-------------- -------------- --------------
Net cash inflow/(outflow) from financing
activities 16,631 9,446 8,592
-------------- -------------- --------------
Net increase/(decrease) in cash
and cash equivalents 14,450 5,859 2,558
Cash and cash equivalents at the
beginning of the period 9,275 6,717 6,717
-------------- -------------- --------------
Cash and cash equivalents at the
end of the period 23,725 12,576 9,275
Notes to the Consolidated Financial Statements
1 General Information
AFH Financial Group Plc is a company incorporated in England and
Wales. The Group is principally engaged in the provision of
independent financial advice to the retail market.
2 Basis of preparation and accounting policies
2.1 Basis of preparation
The interim condensed consolidated financial statements have
been prepared in accordance with IAS 34 Interim Financial
Reporting. 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 financial statements for the year ended 31 October
2017, which were prepared in accordance with International
Financial Reporting Standards adopted by the International
Accounting Standards Board ("IASB") and interpretations issued by
the International Financial Reporting Interpretations Committee
("IFRIC") of the IASB (together "IFRS") as adopted by the European
Union, and in accordance with the requirements of the Companies Act
applicable to companies reporting under IFRS.
The information relating to the six months ended 30 April 2018
and the six months ended 30 April 2017 is unaudited and does not
constitute statutory financial statements within the meaning of
section 434 of the Companies Act 2006. The Group's statutory
financial statements for the year ended 31 October 2017 have been
reported on by its auditor and delivered to the Registrar of
Companies. The report of the auditor was unqualified and did not
draw attention to any matters by way of emphasis, or contain a
statement under section 498(2) or (3) of the Companies Act
2006.
2.2 Significant accounting policies
The accounting policies adopted in the preparation of the
interim condensed consolidated financial statements are consistent
with those followed in the preparation of the Group's annual
financial statements for the six months ended 30 April 2018.
2.3 Basis of consolidation
The interim condensed consolidated financial statements
consolidate the financial statements of the Company and its
subsidiary undertakings as at 30 April and 31 October each
year.
Subsidiaries are fully consolidated from the date of
acquisition, being the date on which the Group obtains control, and
continue to be consolidated until the date that such control
ceases. The financial statements of subsidiaries are prepared for
the same reporting period as the parent company, using consistent
accounting policies.
2.4 Key sources of judgements and estimation uncertainty
The preparation of the condensed consolidated financial
statements requires management to make estimates and assumptions
that affect the reported amount of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities. If in the
future such estimates and assumptions, which are based on
management's best judgement at the date of preparation of the
financial statements, deviate from actual circumstances, the
original estimates and assumptions will be modified as appropriate
in the period in which the circumstances change. The areas where a
higher degree of judgement or complexity arises, or where
assumptions and estimates are significant to the consolidated
financial statements, are discussed below.
Impairment of client portfolios
The Group reviews whether acquired client portfolios are
impaired at least on an annual basis. This comprises an estimation
of the fair value less cost to sell and the value in use of the
acquired client portfolios. In assessing value in use, the
estimated future cash flows expected to arise from the individual
client portfolios are discounted to their present value over a
finite period to calculate the fair value.
The key assumptions used in arriving at a fair value less cost
of sale are those around valuations based on multiples of future
earnings streams and values based on assets under management. These
have been determined by looking at valuations of similar businesses
and the consideration paid in comparable transactions.
The carrying amount of client portfolios at 30 April 2018 was
GBP37.8m (2017 HY: GBP23.1m). No impairments have been made during
the period (2017 HY: nil).
Impairment of goodwill
The Group determines whether goodwill is impaired at least on an
annual basis. This requires an estimation of the value in use of
the cash-generating units to which the goodwill has been allocated.
In assessing value in use, the estimated future cash flows expected
to arise from the cash-generating unit are discounted to their
present value using the Group's weighted average cost of capital
adjusted for tax.
The carrying amount of goodwill at 30 April 2018 was GBP6.6m
(2017 HY: GBP2.1m). No impairments have been made during the period
(2017 HY: GBP nil).
3 Revenue and segmental Analysis
The following is an analysis of the Group's revenue and results
from continuing operations by reportable segment.
Unaudited Six months ending 30 April
2018
Financial Advice and Investment
Head Office Management Protection Total
2018 2018 2018 2018
GBP'000 GBP'000 GBP'000 GBP'000
-------------- -------------------------------------- ----------- ---------
Revenue - 18,829 3,877 22,706
Cost of sales - (8,555) (2,070) (10,625)
Gross profit - 10,274 1,807 12,081
Administrative expenses before
amortisation and depreciation and
share based payments expenses (1,237) (5,883) (535) (7,655)
4,426
-------------- -------------------------------------- ----------- ---------
Underlying EBITDA (1,237) 4,391 1,272 4,426
Amortisation and Depreciation - (1,031) (17) (1,048)
Non cash share based payments (72) - - (72)
Operating profit (1,309) 3,360 1,255 3,306
Finance income 35 3 2 40
Finance costs (122) - - (122)
Profit before tax (1,396) 3,363 1,257 3,224
Unaudited Six months ending 30 April
2017
Financial Advice and Investment
Head office Management Protection Total
2017 2017 2017 2017
GBP'000 GBP'000 GBP'000 GBP'000
-------------- -------------------------------------- ----------- ---------
Revenue - 13,865 - 13,865
Cost of sales - (6,055) - (6,055)
Gross profit - 7,810 - 7,810
Administrative expenses before
amortisation and depreciation and
share based payments expenses (1,069) (4,712) - (5,781)
2,02
-------------- -------------------------------------- ----------- ---------
Underlying EBITDA (1,069) 3,098 - 2,029
Amortisation and Depreciation - (689) - (689)
Non cash share based payments (72) - - (72)
Operating profit (1,141) 2,409 1,268
Finance income 6 - - 6
Finance costs (123) - - (123)
Profit before tax (1,258) 2,409 - 1,151
Segment revenue reported above represents revenue generated from
external customers. There were no Inter-segment sales in the
current year.
The Accounting policies of the reportable segments are the same
as the Group's accounting policies.
The total revenue of the Group for the year has been derived
from its activities wholly undertaken in the United Kingdom.
No customer is defined as a major customer by revenue,
contributing more than 10% of the Group revenues (2017 -
GBPnil)
4. Intangible Assets
Acquired
Other client
intangibles Goodwill portfolios Total
GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 31 October 2016 - 2,465 21,543 24,008
Additions - - 4,368 4,368
Disposals - - - -
Revaluations - - - -
At 30 April 2017 2,465 25,911 28,376
Additions 401 4,500 9,835 14,736
Disposals - - - -
Revaluations - - - -
At 31 October 2017 401 6,965 35,746 43,112
Additions - - 6,732 6,732
Disposals - - - -
Revaluations - - - -
At 30 April 2018 401 6,965 42,478 49,844
Amortisation
At 31 October 2016 - 375 2,274 2,649
Charge for the period - - 570 570
At 30 April 2017 - 375 2,844 3,219
Charge for the period 16 - 947 963
At 31 October 2017 16 375 3,791 4,182
Charge for the period 20 - 908 928
At 30 April 2018 36 375 4,699 5,110
Net book value
At 30 April 2018 365 6,590 37,779 44,734
At 31 October 2017 385 6,590 31,955 38,930
At 30 April 2017 - 2,090 23,067 25,157
At 31 October 2016 - 2,090 19,269 21,359
Goodwill and Acquired client portfolios
Goodwill believed to have an indefinite useful life is carried
at cost. The determination of whether goodwill is impaired requires
an assessment of the value in use. The recoverable amount of
goodwill on a value in use calculation is based on the discounted
cash flows expected from the intangible assets of each acquisition,
assuming no future growth in revenue generated cash flows,
discounted at an implied factor of 10%, for a period of 10 years
with no annuity. On this basis the directors believe the value of
goodwill is not impaired at 30 April 2018. The directors have
concluded that Goodwill relates to a single Cash Generating
Unit.
The Directors have assessed the sensitivity of the assumptions
detailed above and consider that, due to the level of prudence
already factored into these assumptions, it would require a
significant adverse variance in any of these to reduce the fair
value to a level where it matched the carrying value.
During the period ended 30 April 2018, 3 asset purchases and 3
share purchases were undertaken relating to acquired client
portfolios. Consideration for these acquisitions amounted to
GBP6.7m, of which GBP6.7m related to client portfolios. Included
within the total consideration are amounts relating to contingent
consideration of GBP3.5m. The contingent consideration is subject
to earn outs based on future turnover over a period up to three
year period.
5. Trade and other receivables
Group
Unaudited Unaudited Audited
Six months Six months Twelve
ending 30 ending 30 months
April 2018 April 2017 ending
31 October
2017
GBP'000 GBP'000 GBP'000
Trade receivables 6,037 3,298 4,426
Other receivables 1,065 1,370 725
Prepayments 801 440 864
7,903 5,108 6,015
There are no bad or doubtful receivables.
6. Analysis of borrowings
Unaudited Unaudited Audited
Six months Six months Twelve months
ending 30 ending 30 ending 31
April April October
2018 2017 2017
GBP'000 GBP'000 GBP'000
Current borrowings
Mortgage on freehold property 78 77 77
7.5% Unsecured bonds 2,142 - -
-------------- -------------- --------------
2,220 77 77
Non-current borrowings
8% Unsecured bonds 752 752 752
7.5% Unsecured bonds - 2,142 2,142
Mortgage on freehold property 351 423 387
-------------- -------------- --------------
1,103 3,317 3,281
The financial liabilities are recognised at amortised cost.
There is no material difference between the fair value and the
carrying value.
The 8% unsecured bond is due in 2020. The 7.5% Unsecured bond is
due in December 2018.
The mortgage is repayable by instalments over an 8 year period,
ending October 2023, with an interest rate of 2.9% over LIBOR.
7. Trade and other payables
Unaudited Unaudited Audited
Six months Six months Twelve months
ending 30 ending 30 ending 31
April April October
2018 2017 2017
GBP'000 GBP'000 GBP'000
Current
Trade payables 1,587 948 1,373
Contingent consideration 4,869 3,039 4,637
Commissions payable 4,604 2,584 4,076
Other payables 664 355 599
Accruals 335 126 817
12,059 7,052 11,502
Non-current
Contingent consideration 7,996 2,476 6,736
8. Share Capital
Unaudited Unaudited Audited
Six months Six months Twelve
ending 30 ending months
April 30 April ending
31 October
2018 2017 2017
37,822,154 authorised, issued and
fully paid 10p ordinary shares 3,782 3,008 3,058
9. Earnings per share
The calculation of earnings per share is based on the profit
attributable to the equity holders for the period of GBP2,491,000
(2017 - GBP921,000) and weighted average number of shares in issue
during the period of 36,352,925 (2016 - 24,806,775).
The diluted earnings per share has been adjusted for the
potential share issue relating to the share-based payments. The
number of shares has been increased by the difference between the
amount of shares that will be issued if all options are exercised
and the number of shares that could be purchased for the same
consideration at average market price.
Unaudited Unaudited Audited
Six months Six months Twelve months
ending 30 ending ending 31
April 30 April October
2018 2017 2017
GBP'000 GBP'000 GBP'000
Weighted average number of ordinary
shares for the purpose of basic
earnings per share 36,352,925 24,806,775 27,300,689
Effect of dilutive potential ordinary
shares 3,089,690 2,487,559 2,420,417
Weighted average number of ordinary
shares for the purpose of diluted
earnings per share 39,442,615 27,295,334 29,721,106
There are no adjustments between the Earnings for the purpose of
basic earnings per share being net profit attributable to
shareholders and the Earnings for the purpose of diluted earnings
per share.
There are no adjustments between the Net profit attributable to
equity holders of the parent and the Earnings from continued
operations for the purpose of diluted earnings per share excluding
discontinued operation.
Underlying earnings per share of 9.98p (2016 - 6.17p) have been
calculated on the profit attributable to the equity holders for the
period after adding back Amortisation, Depreciation and non-cash
share based payments after adjusting the tax provision
accordingly.
10. Reconciliation of Operating profit to Net Cash inflow from
Operating Activities
Unaudited Unaudited Audited
Six months Six months Twelve months
ending 30 ending 30 ending 31
April April October
2018 2016 2017
GBP'000 GBP'000 GBP'000
Profit before tax for the
period 3,224 1,151 3,507
Adjustments for
Interest and other investment
income (40) (6) (19)
Interest expense 122 123 245
Depreciation, amortisation
and impairment 1,048 689 1,778
Equity settled share based
expense 72 72 136
Movements in working capital
Decrease / (Increase) in trade
and other receivables (1,529) (23) (1,195)
(Decrease) / Increase in trade
and other payables 621 (551) (1,252)
Cash generated from operations 3,518 1,455 5,704
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR SSDFIFFASEFM
(END) Dow Jones Newswires
June 04, 2018 02:00 ET (06:00 GMT)
Afh Financial (LSE:AFHP)
Graphique Historique de l'Action
De Juin 2024 à Juil 2024
Afh Financial (LSE:AFHP)
Graphique Historique de l'Action
De Juil 2023 à Juil 2024
