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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Assetco Plc | LSE:ASTO | London | Ordinary Share | GB00BQ2K3557 | ORD 1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 36.50 | 36.00 | 37.00 | 36.50 | 36.50 | 36.50 | 19,664 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Offices-holdng Companies,nec | 16.72M | -26.7M | -3.1691 | -0.12 | 3.08M |
TIDMASTO
RNS Number : 8886O
AssetCo PLC
15 June 2022
15 June 2022
AssetCo plc
("AssetCo" or the "Company")
2022 Half-year Report
for the six months ended 31 March 2022
Key highlights
-- Two acquisitions announced to expand AssetCo's listed equity platform and to build a private markets capability:
o River and Mercantile Group ("RMG")
o Revera Asset Management
-- Progress made at underlying businesses:
o Rize ETF - three additional strategies launched and positive net inflows in each month
o Saracen Fund Managers - improvement in positioning and performance
o Parmenion - strong profit growth, with growth prospects improved through broadening of investment offering
-- Assets under Management: GBP12.2 billion (following completion of River and Mercantile acquisition)
-- Proposed 13.0p interim dividend expected to be declared in Q4 2022
Campbell Fleming, Chief Executive Officer of AssetCo plc, commented:
"We have made good progress in developing AssetCo's listed equity platform, private markets capability and thematic ETF business. At the same time, Parmenion, which provides investment solutions to advisers and their clients, has expanded. The current market environment, alongside the structural shifts taking place within the asset and wealth management sector, supports a strategy of building an agile asset and wealth manager, uninhibited by legacy issues, to meet the needs of investors."
"There is still much to do, but we have the people, products and the financial strength to deliver for clients and shareholders alike. We will continue to invest in our existing businesses, assess strategic opportunities that will add value to our capabilities, and focus on generating organic growth."
For further information, please contact:
AssetCo plc Numis Securities Limited Campbell Fleming, CEO Nominated adviser and joint Peter McKellar, Deputy Chairman broker James Thorneley, Head of Communications Stephen Westgate / Charles Farquhar/ Tel: +44 (0) 7958 005141 Giles Rolls Tel: +44 (0) 20 7260 1000 Panmure Gordon (UK) Limited Maitland/AMO Joint broker Neil Bennett Charles Leigh-Pemberton / Atholl Rachel Cohen Tweedie / Gabriel Hamlyn Tel: +44 (0) 20 7379 5151 Tel: +44 (0) 20 7886 2906
For further details, visit the website, www.assetco.com
Ticker: AIM: ASTO.L
CHAIRMAN'S STATEMENT
The six months ended 31 March 2022 was a period of building and growing, following a transformational financial year for AssetCo, during which the Company was transformed into an asset and wealth management business and agreed to acquire interests in four businesses.
There are numerous structural shifts taking place within the asset and wealth management industry driven by changing investor needs, demographics, an evolving approach to savings products, the use of technology and digitalisation, and a continuing pressure on fees. These are presenting both challenges and opportunities. AssetCo is focused on identifying and building on a limited number of growth opportunities and in unlocking value from the repositioning of more traditional asset managers. Of particular relevance are high conviction active equities, ESG/sustainable strategies and thematic investing, and private markets capabilities.
Financials
The Income Statement for the six months ended 31 March 2022 shows revenue of GBP1.3 million (31 March 2021: nil) and a loss before taxation of GBP2.6 million (31 March 2021: profit GBP22.3 million), which is in line with our expectations as we continue to build the business. The profit in 2021 principally arose from the final payment received from the successful litigation claim against Grant Thornton.
Net assets at 31 March 2022 were GBP55.6 million (31 March 2021: GBP31.1 million). This uplift in net assets includes the investment gain in RMG shares of GBP1.2 million, where the Company held 5.85% of the issued equity share capital prior to the acquisition and the goodwill recognised on investments in Rize ETF and Saracen totalling GBP19.8 million.
Building Active Equity and Private Markets platforms
In January 2022, the Company announced an offer to acquire River and Mercantile Group by way of a scheme of arrangement for effectively GBP95.3 million, to be satisfied by the issue of around 6 million new AssetCo shares. The offer was conditional on the sale of River and Mercantile's UK Solutions business and a subsequent GBP190 million return of capital to shareholders, both of which have now occurred. The acquisition received overwhelming support from both River and Mercantile and AssetCo shareholders at their respective General Meetings and has received regulatory approval from the Financial Conduct Authority. Completion of the acquisition and the issue of the new AssetCo shares takes place today.
River and Mercantile has an established and well-respected equities team that manages around GBP2.7 billion of Assets under Management (AuM). Importantly, the acquisition also provides the foundation stone to building a private markets business given its infrastructure investment team.
Significant progress has already been made in terms of right-sizing the River and Mercantile business post the sale of the UK Solutions business. Material cost efficiencies have been identified, with a large proportion being implemented. It is hoped that, due to the actions being taken both on cost and building new revenue, River and Mercantile can be returned to profitability by early 2023.
Separately, in February 2022 the Company announced the acquisition of Revera Asset Management for GBP2.8 million, to be satisfied through a mix of new AssetCo shares and cash. Revera has approximately GBP103 million of AuM and is based in Edinburgh. The acquisition of Revera is conditional on regulatory approval from the Financial Conduct Authority, which is expected shortly. The proposed acquisition of Revera, along with that of Saracen Fund Managers last year, demonstrates our desire to have a strong presence in Scotland, given the talent and expertise located there.
Subject to regulatory approval and completion, River and Mercantile, Saracen Fund Managers and Revera will form the Company's listed equity platform, offering a range of UK, smaller companies, European and Global capabilities. Individual teams will continue to employ their existing investment processes, but will benefit from sharing research, ESG analysis, distribution and marketing resources. This should result in a more efficient and cost effective platform.
Progress of existing businesses
The last six months has been a challenging period for financial markets. Despite this, all of the Company's existing businesses have made good progress.
Since the Company acquired Rize in July 2021, the business has successfully launched three new thematic strategies - Digital Payments Economy, Pet Care and Emerging Market Internet and Ecommerce. The business now offers eight ETFs with total AuM of $512.9 million and, despite a challenging market environment, recorded net inflows in each of the six months to 31 March 2022.
During the period under review, Parmenion, a B2B investment and advisory platform to the UK wealth and IFA sector, broadened the range of managed portfolio solutions that are available on its platform. It has added strategies managed by LGT Wealth Management, Tatton Investment Management and Dimensional. The platform's AuM was GBP9.4 billion at 31 March 2022, and has been relatively robust given the volatility in financial markets, but should see growth over the calendar year.
In May 2022, Parmenion published its annual report and accounts for the 12 months ended 31 December 2021, which provided a good overview of the business and its potential. Year-on-year management and custody fees grew from GBP29.6 million to GBP35.6 million - an increase of 21%. There was a significant increase in underlying profit to GBP4.6 million. AuM grew by 17.2%, from GBP8.2 billion to GBP9.6 billion. Parmenion partners with over 1,500 advisers providing investment solutions to over 80,000 underlying clients.
Following the acquisition of Saracen in July 2021, the business has been relaunched with an updated brand. At 31 March 2022, AuM was GBP113.2 million.
Capital structure and dividend policy
We intend to write to shareholders shortly with proposals to instigate a sub-division of the Company's ordinary shares of 10p each ("Ordinary Shares") on a basis to be determined. Such a sub-division would increase the number of Ordinary Shares in issue and the Board believes this would reduce the Company's share price to a level where smaller sized dealings in Ordinary Shares would be more efficient. It should also improve the liquidity, spread and marketability of the Ordinary Shares to a wider group of investors.
The Board recognises the importance some investors attach to receiving a regular income from their shareholdings. It is, therefore, expected that the Company declares a 13.0p interim dividend in Q4 2022. Thereafter, the Company intends to adopt a progressive dividend policy.
Board and Corporate Broker
I would like to welcome Jonathan Dawson to the Board further to the completion of the acquisition of River and Mercantile. Jonathan was previously Chairman of River and Mercantile. He started his career in the Ministry of Defence before joining Lazard, the investment bank, where he spent over 20 years. He left Lazard in 2005 and co-founded Penfida Limited, the leading independent corporate finance advisor to pension funds. Jonathan's experience and expertise will be a valuable addition to the Board.
In April, the Company announced the appointment of Numis as Nominated Adviser and Joint Broker. The Company also appointed Panmure Gordon as Joint Broker. The Board and I are grateful to the team at Arden Partners, our former Nominated Adviser, for their advice and hard work over the years and wish them well for the future.
Outlook
The Company continues to make good progress in executing on its strategy. The Company is also in sound financial shape and following completion of the acquisition of, and return of capital from, River and Mercantile, the Group will have net cash of more than GBP45 million.
The acquisition of River and Mercantile results in the Group having investments in businesses with total AuM of GBP12.2 billion, with genuine strength in active equities and thematic strategies, together with an embryonic private markets business. Our aim in relation to the integration of the businesses is to develop an operating model which will improve scalability, drive material cost synergies and strengthen distribution.
Martin Gilbert
Chairman
15 June 2022
AssetCo plc
Consolidated Income Statement
for the six month ended 31 March 2022
Six months ended Year ended Notes Unaudited Unaudited31 Audited 31 March 2022 March 2021 30 Sept GBP'000 GBP'000 2021 GBP'000 ----------------------------------- ------ --------------------- ---------------- ------------ Revenue 3 1,285 - 408 Cost of sales (1,767) - (536) ------------------------------------------- --------------------- ---------------- ------------ Gross (loss)/profit (482) - (128) Other income 4 - 22,388 22,388 Administrative expenses (5,261) (766) (7,967) ------------------------------------------- --------------------- ---------------- ------------ Operating (loss)/profit (5,743) 21,622 14,293 Share of net profits of associate accounted for using equity method 1,512 - - Investment income 5 1,590 645 1,844 Finance costs - (8) (8) ------------------------------------------- --------------------- ---------------- ------------ (Loss)/profit before income tax 6 (2,641) 22,259 16,129 Income tax charge 7 - - (1,442) ----------------------------------- ------ --------------------- ---------------- ------------ (Loss)/profit for the year (2,641) 22,259 14,687 ------------------------------------------- --------------------- ---------------- ------------ (Loss)/profit attributable to: Owners of the parent (2,252) 22,259 14,796 Non-controlling interest (389) - (109) ------------------------------------------- --------------------- ---------------- ------------ (2,641) 22,259 14,687 ------------------------------------------ --------------------- ---------------- ------------ Earnings per Ordinary Share Pence Pence Pence attributable to the owners of the parent during the year ----------------------------------- ------ --------------------- ---------------- ------------ From continuing operations Basic 8 (26.73) 284.72 180.57 Diluted 8 (23.91) 284.72 161.05 ----------------------------------- ------ --------------------- ---------------- ------------
AssetCo plc
Consolidated Statement of Comprehensive Income
for the six month ended 31 March 2022
Six months ended Year ended Unaudited Unaudited Audited 30 31 March 2022 31 March Sept 2021 GBP'000 2021 GBP'000 GBP'000 ----------------------------------- -------------------- ------------- ----------------- (Loss)/profit for the year (2,641) 22,259 14,687 Other comprehensive (loss)/income: Currency translation differences - (10) (7) ------------------------------------ -------------------- ------------- ----------------- Other comprehensive income (net of tax) - (10) (7) ------------------------------------ -------------------- ------------- ----------------- Total comprehensive income for the period (2,641) 22,249 14,680 ------------------------------------ -------------------- ------------- ----------------- Attributable to: Owners of the parent (2,252) 22,249 14,799 Non-controlling interests (389) - (109) ------------------------------------ -------------------- ------------- ----------------- Total comprehensive income for the year (2,641) 22,249 14,680 ------------------------------------ -------------------- ------------- -----------------
AssetCo plc
Consolidated Statement of Financial Position
as at 31 March 2022
Notes Unaudited Unaudited Audited 31 March 31 March 2021 30 Sept 2022 GBP'000 2021 GBP'000 GBP'000 -------------------------------- ----- ---------- -------------------- -------------- Assets Non-current assets Property, plant and equipment 27 - 16 Intangible assets 20,051 - 20,067 Investments accounted for using the equity method 9 23,383 - - -------------------------------- ----- ---------- -------------------- -------------- Total non-current assets 43,461 - 20,083 -------------------------------- ----- ---------- -------------------- -------------- Current assets Trade and other receivables 636 230 607 Financial assets at fair value through profit and loss 10 13,200 10,800 12,000 Current income tax receivable 3 - 3 Cash and cash equivalents 3,634 21,324 26,902 -------------------------------- ----- ---------- -------------------- -------------- Total current assets 17,473 21,554 39,512 -------------------------------- ----- ---------- -------------------- -------------- Total assets 60,934 32,354 55,595 -------------------------------- ----- ---------- -------------------- -------------- Liabilities Non-current liabilities Deferred tax liabilities 49 - 49 -------------------------------- ----- ---------- -------------------- -------------- Total non-current liabilities 49 - 49 -------------------------------- ----- ---------- -------------------- -------------- Current liabilities Trade and other payables 1,973 1,251 1,972 Loan due to related party 1,000 - - Current income tax liabilities 1,437 - 1,437 -------------------------------- ----- ---------- -------------------- -------------- Total current liabilities 4,908 1,251 3,409 -------------------------------- ----- ---------- -------------------- -------------- Total liabilities 4,957 1,251 3,458 -------------------------------- ----- ---------- -------------------- -------------- Equity attributable to owners of the parent Share capital 843 653 843 Share premium 27,770 3,274 27,770 Capital redemption reserve 653 653 653 Merger reserve 2,762 - 2,762
Other reserves 7,977 - 5,496 Retained earnings 16,640 26,523 18,892 -------------------------------- ----- ---------- -------------------- -------------- 56,645 31,103 56,416 Non-controlling interest (668) - (279) -------------------------------- ----- ---------- -------------------- -------------- Total equity 55,597 31,103 56,137 -------------------------------- ----- ---------- -------------------- -------------- Total equity and liabilities 60,934 32,354 55,595 -------------------------------- ----- ---------- -------------------- --------------
AssetCo plc
Consolidated Cash Flows
for the six month ended 31 March 2022
Six months ended Year ended Unaudited Unaudited Audited 31 March 31 March 30 Sept 2022 2021 2021 GBP'000 GBP'000 GBP'000 ------------------------------------------ --------- --------- ---------- Cash flow from operating activities Cash generated by operations (note 11) (2,768) 19,381 16,755 Cash released in respect of bonds - 1,126 1,104 Finance costs - (8) (8) ------------------------------------------ --------- --------- ---------- Net cash generated by operating activities (2,768) 20,499 17,851 ------------------------------------------ --------- --------- ---------- Cash flow from investing activities Payments for acquisition of subsidiaries, net of cash acquired - - (16,460) Payments to acquire associated undertakings (21,871) - - Dividends received from financial assets held at fair value 390 - 194 Interest income - - - Purchase of property, plant and equipment (14) - (8) Purchase of intangibles (6) - (1) ------------------------------------------ --------- --------- ---------- Net cash used in investing activities (21,501) - (16,275) ------------------------------------------ --------- --------- ---------- Cash flow from financing activities Proceeds from issuance of ordinary shares - - 25,103 Costs of share issue - - (515) Payments for shares bought back - (26,850) (26,850) Buy-back transaction costs - (171) (171) Short-term loan from related party 1,000 - - ------------------------------------------ --------- --------- ---------- Net cash flow from financing activities 1,000 (27,021) (2,523) ------------------------------------------ --------- --------- ---------- Net change in cash and cash equivalents (23,269) (6,522) (947) Cash and cash equivalents at beginning of year 26,902 27,860 27,860 Exchange differences on translation - (14) (11) ------------------------------------------ --------- --------- ---------- Cash and cash equivalents at end of year 3,633 21,324 26,902 ------------------------------------------ --------- --------- ----------
AssetCo plc
Consolidated Statement of Changes in Equity
for the six month ended 31 March 2022
Share Capital Share premium redemption Merger Other Retained Non-controlling Total capital account reserve reserve reserve earnings Total interest equity GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 ----------------- ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- At 1 October 2020 1,221 - - - - 31,124) 32,345 - 32,345 Comprehensive income Profit for the period - - - - - 22,259 22,259 - 22,259 Other comprehensive income/(expense) Currency translation differences - - - - - (10) (10) - (10) ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- Total comprehensive income - - - - - 22,249 22,249 - 22,249 ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- Share-based payments - success fee 85 3,445 - - - - 3,530 - 3,530 Share buy-back (653) - 653 - - (26,850) (26,850) - (26,850) Costs of share buy-back - - - - - (171) (171) -` (171) ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- At 31 March 2021 653 3,445 653 - - 26,352 31,103 - 31,103 ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- Comprehensive income Loss for the period - - - - - (7,463) (7,463) (109) (7,572) Other comprehensive income Currency translation differences - - - - - (3) (3) - (3) ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- Total comprehensive (loss) - - - - - (7,460) (7,460) (109) (7,569) ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- Proceeds from share issue 173 24,840 - - - - 25,013 - 25,013 Costs of share issue - (515) - - - - (515) - (515) Shares issued on acquisition 17 - - 2,762 - - 2,779 - 2,779 Share-based payments - LTIP - - - - 5,496 - 5,496 - 5,496 Non-controlling interest on acquisition - - - - - - - (170) (170) ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- At 30 September 2021 843 27,770 653 2,762 5,496 18,892 56,416 (279) 56,137 ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- Comprehensive income Loss for the period - - - - - (2,252) (2,252) (389) (2,641) ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- Total comprehensive (loss) - - - - - (2,252) (2,252) (389) (2,641) ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- Share-based payments - LTIP - - - - 2,481 - 2,481 - 2,481 ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- ----------- At 31 March 2022 843 27,770 653 2,762 7,977 16,640 56,6456 (668) 55,977 ------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
NOTES FORMING PART OF THE INTERIM FINANCIAL STATEMENTS
1. General information and basis of presentation
AssetCo Plc ("AssetCo" or the "Company") is a public limited company incorporated and domiciled in England and Wales. The address of its registered office is Singleton Court Business Park, Wonastow Road, Monmouth, Monmouthshire, NP25 5JA.
The Group's principal activity is the development of an asset and wealth management business.
The financial information in the Half-year Report has been prepared using the recognition and measurement principles of the international accounting standards in conformity with the requirements of the Companies Act 2006 ("IFRS"). The principal accounting policies used in preparing the Half-year Report are those the Company expects to apply in its financial statements for the year ending 30 September 2022 and are unchanged from those disclosed in the Annual Report and Financial Statements for the year ended 30 September 2021 with the exception that following the acquisition of 30% of Parmenion Capital Partners LLP on 1 October 2021 the Group has adopted IFRS 10 in respect of accounting for Associated undertakings.
The financial information for the six months ended 31 March 2022 and the six months ended 31 March 2021 is unaudited and does not constitute the Group's statutory financial statements for those periods. The comparative financial information for the full year ended 30 September 2021 has, however, been derived from the audited statutory financial statements for that period. A copy of those statutory financial statements has been delivered to the Registrar of Companies.
While the financial figures included in this Half-year Report have been computed in accordance with IFRSs applicable to interim periods, this Half-year Report does not contain sufficient information to constitute an interim financial report as that term is defined in IAS 34.
The financial statements have been presented in sterling to the nearest thousand pounds (GBP'000), except where otherwise indicated .
2. Going concern
At the time of approving the financial statements, the Directors have a reasonable expectation that the Company and Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.
3. Segmental reporting
The core principle of IFRS 8 'Operating segments' is to require an entity to disclose information that enables users of the financial statements to evaluate the nature and financial effects of the business activities in which the entity engages and the economic environments in which it operates. Segment information is therefore presented in respect of the company's commercial competencies, Active Specialists, High-Growth Thematics and Digital Platforms and Head Office Costs.
All revenues are earned in the UK. The Directors consider that the chief operating decision maker is the Board.
The amounts provided to the Board with respect to net assets are measured in a manner consistent with that of the financial statements. The Company is domiciled in the UK and also operated out of a branch in UAE. Unallocated comprises the assets and liabilities of AssetCo, including the UAE business with Head Office costs identified separately.
The segment information provided to the Board for the reportable segments is as follows:
Period ended Digital 31 March 2022 Active High-growth platforms unaudited specialists thematics Head office Unallocated Total GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 ------------------------ ------------ ----------- ---------- ----------- ----------- -------- Revenue Management fees 424 - - - - 424 Marketing fees - 861 - - - 861 ------------------------ ------------ ----------- ---------- ----------- ----------- -------- Total revenue 424 861 - - - 1,285 ------------------------ ------------ ----------- ---------- ----------- ----------- -------- Operating result before adjustments (6) (1,229) 1,512 (969) - (692) Share-based payments - LTIP - - - - (2,493) (2,493) Exceptional costs - - - - (1,046) (1,046) ------------------------ ------------ ----------- ---------- ----------- ----------- -------- Operating profit/(loss) (6) (1,229) 1,512 (969) (3,539) (4,231) Investment income - - - - 1,590 1,590 Finance costs - - - - - - ------------------------ ------------ ----------- ---------- ----------- ----------- -------- Profit/(loss) before tax (6) (1,229) 1,512 (969) (1,949) (2,641) Income tax - - - - - - ------------------------ ------------ ----------- ---------- ----------- ----------- -------- Profit/(loss) for the year (6) (1,229) 1,512 (969) (1,949) (2,641) ------------------------ ------------ ----------- ---------- ----------- ----------- -------- Segment assets Total assets 3,523 20,346 23,383 - 14,682 60,934 Total liabilities (48) (304) - - (4,604) (4,956) ------------------------ ------------ ----------- ---------- ----------- ----------- -------- Total net assets 3,475 20,042 23,383 - 10,078 55,978 ------------------------ ------------ ----------- ---------- ----------- ----------- -------- Depreciation - 3 - - - 3 Amortisation 2 20 - - - 22 Total capital expenditure - 20 - - - 20 Period ended 31 March 2021 Active High-growth Digital Head unaudited specialists thematics platforms office Unallocated Total GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 ------------------------ ------------ ----------- ---------- ------- ----------- ------- Revenue Management fees - - - - - - Marketing fees - - - - - - ------------------------ ------------ ----------- ---------- ------- ----------- ------- Total revenue - - - - - - ------------------------ ------------ ----------- ---------- ------- ----------- ------- Operating result before adjustments - - - (460) - (460) Other income - - - - 22,388 22,388 Share-based payments - LTIP - - - - - - Exceptional costs - - - - (306) (306) ------------------------ ------------ ----------- ---------- ------- ----------- ------- Operating profit/(loss) - - - (460) 22,082 21,622 Investment income - - - - 645 645 Finance costs - - - - (8) (8) ------------------------ ------------ ----------- ---------- ------- ----------- ------- Profit before tax - - - (460) 22,719 22,259 Income tax - - - - - - ------------------------ ------------ ----------- ---------- ------- ----------- ------- Retained profit - - - (460) 22,719 22,259 ------------------------ ------------ ----------- ---------- ------- ----------- ------- Segment assets Total assets - - - - 32,354 32,354 Total liabilities - - - - (1,251) (1,251) ------------------------ ------------ ----------- ---------- ------- ----------- ------- Total net assets - - - - 31,103 31,103 ------------------------ ------------ ----------- ---------- ------- ----------- ------- Total capital expenditure - - - - - - Year ended 30 September 2021 Active High-growth Digital Head audited specialists thematics platforms office Unallocated Total GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 ------------------------ ------------ ----------- ---------- ------- ----------- -------- Revenue Management fees 135 - - - - 408 Marketing fees - 273 - - - 273 ------------------------ ------------ ----------- ---------- ------- ----------- -------- Total revenue 135 273 - - - 408 ------------------------ ------------ ----------- ---------- ------- ----------- -------- Operating result before adjustments 32 (347) - (1,147) - (1,516) Other income - - - - 22,388 22,388
Share-based payments - LTIP - - - (6,273) (6,273) Exceptional costs - - - - (360) (360) ------------------------ ------------ ----------- ---------- ------- ----------- -------- Operating profit/(loss) 32 (347) - (1,147) 15,755 14,293 Investment income - - - - 1,844 1,844 Finance costs - - - - (8) (8) ------------------------ ------------ ----------- ---------- ------- ----------- -------- Profit/(loss) before tax 32 (347) - (1,147) 17,591 16,129 Income tax (6) 1 - - (1,437) (1,442) ------------------------ ------------ ----------- ---------- ------- ----------- -------- Profit/(loss) for the year 26 (346) - (1,147) 16,154 14,687 ------------------------ ------------ ----------- ---------- ------- ----------- -------- Segment assets Total assets 3,518 21,712 - - 34,335 59,595 Total liabilities (85) (471) - - (2,902) (3,458) ------------------------ ------------ ----------- ---------- ------- ----------- -------- Total net assets 3,433 21,271 - - 31,433 56,137 ------------------------ ------------ ----------- ---------- ------- ----------- -------- Depreciation - 2 - - - 2 Amortisation 1 7 - - - 8 Total capital expenditure 3 5 - - - 8 4. Other income Six months ended Year ended Unaudited Unaudited Audited 31 March 31 March 30 September 2022 2021 2021 GBP'000 GBP'000 GBP'000 -------------------------- --------- ------------ ------------- Grant Thornton litigation - 25,918 25,918 Success fee - (3,530) (3,530) -------------------------- --------- ------------ ------------- - 22,388 22,388 -------------------------- --------- ------------ -------------
The case against Grant Thornton was concluded successfully in the financial year 2021. The total award came to GBP30.515 million, of which GBP4.597 million was reflected in the 2020 full year accounts, as it had been awarded by the Courts irrespective of the outcome of any appeal. Other income shown in these accounts represents the balance of the Court's award, less the success fee of 15% of claim proceeds excluding costs.
5. Investment income Six months ended Year ended Unaudited Unaudited Audited 31 March 31 March 30 September 2022 2021 2021 GBP'000 GBP'000 GBP'000 ------------------------------------------ --------- ------------ ------------- Fair value gains on financial instruments classified as fair value through profit and loss 1,200 450 1,650 Dividend income 390 195 195 ------------------------------------------ --------- ------------ ------------- 1,590 645 1,845 ------------------------------------------ --------- ------------ ------------- 6. Adjusted profit Six months ended Year ended Unaudited Unaudited Audited 31 March 31 March 30 September 2022 2021 2021 GBP'000 GBP'000 GBP'000 ------------------------------------------- ---------- ---------- -------------- Reported pre-tax (loss)/profit (2,641) 22,259 16,129 Add back: Other income - Grant Thornton litigation - (22,388) (22,388) Share-based payments - LTIP 2,493 - 6,273 Exceptional costs related to re-admission documents 1,046 306 360 Adjusted pre-tax profit 898 177 374 ------------------------------------------- ---------- ---------- --------------
The Group has grown rapidly since shareholder approval was given to change its strategy in April 2021. Because of AssetCo's relatively low market capitalisation at the outset of its growth journey it has required two re-admission circulars. Prior to the change in strategy the Group had successfully concluded the long-running litigation against its former auditor, Grant Thornton, resulting in a significant settlement which, net of related costs, gave rise to an Other Income figure of GBP22.388 million.
These items, together with a new incentivisation scheme for management in the form of the LTIP, have perhaps masked the underlying progress of the business's results. Accordingly, we have set out above the Group's pre-tax result adjusted for the three items mentioned.
7. Income tax charge
Six months ended Year ended Unaudited Unaudited Audited 31 March 31 March 30 September 2022 GBP'000 2021 GBP'000 2021 GBP'000 -------------------------------------- ------------- ------------- ------------- Current tax: Current tax on profit for the year - - 1,437 -------------------------------------- ------------- ------------- ------------- Total current tax - - 1,437 Deferred tax: Arising from movement in deferred tax assets (228) - (307) Arising from movement in deferred tax liabilities 228 - 312 -------------------------------------- ------------- ------------- ------------- Total deferred tax - - 5 -------------------------------------- ------------- ------------- ------------- Income tax charge - - 1,442 -------------------------------------- ------------- ------------- -------------
8. Earnings per share
Basic earnings per share is calculated by dividing the profit attributable to equity owners of the parent by the weighted average number of Ordinary Shares in issue during the period.
Diluted earnings per share is calculated by adjusting the weighted average number of Ordinary Shares outstanding assuming conversion of all dilutive potential Ordinary Shares. The Company has one category of dilutive potential Ordinary Shares, being shares allocated to the LTIP pool.
Six months ended Year ended Unaudited Unaudited Audited 31 March 31 March 30 September 2022 2021 2021 GBP'000 GBP'000 GBP'000 --------------------------------------- --------- --------- ------------- (Loss)/profit attributable to owners of the parent (2,252) 22,259 14,796 --------------------------------------- --------- --------- ------------- No: No: No: Weighted average number of ordinary shares in issue 8,424,847 7,817,964 8,194,031 Effect of dilutive potential ordinary shares 993,315 - 993,315 --------------------------------------- --------- --------- ------------- Weighted average number of ordinary shares - diluted 9,418,162 7,817,964 9,187,346 --------------------------------------- --------- --------- ------------- Pence Pence Pence Basic (26.73) 284.72 180.57 Diluted (23.91) 284.72 161.05
9. Investments accounted for using the equity method
On 1 October 2021 the Group acquired a 30% stake in Parmenion Capital Partners LLP for a purchase price of GBP21.9 million. The investment is accounted for using the equity method and a reconciliation of the cost of investment and accumulated results of Parmenion is set out below:
Six months ended Year ended Unaudited Unaudited Audited 31 March 31 March 30 September 2022 2021 2021 GBP'000 GBP'000 GBP'000 ---------------------------------- --------- ------------ ------------- At start of period - - - Cost of investment 21,871 - - Share of net profits of associate using equity method 1,512 - - ---------------------------------- --------- ------------ ------------- At end of period 23,383 - - ---------------------------------- --------- ------------ -------------
10. Financial assets at fair value through profit and loss
At 31 March 2022 the Group held 5,000,000 shares in River and Mercantile Group Plc and the fair value at that date is recognised here. The six months to 31 March 2022 shows a fair value gain of GBP1.2 million (see note 5). The Group has also received dividends amounting to GBP390,000 in the period (see note 5). As we report in the Chairman's statement and note 12 we have today announced the completion of the acquisition of River and Mercantile Group Plc so from today's date the investment will be accounted for as a business combination.
11. Cash generated by operations
Six months ended Year ended Unaudited Unaudited Audited 31 March 31 March 30 September 2022 2021 2021 GBP'000 GBP'000 GBP'000 -------------------------------------------- --------- --------- ------------- (2,641 (Loss)/profit before tax ) 22,259 16,129 Adjustments for: Share-based payments - LTIP 2,481 - 5,496 - Success fee on Grant Thornton litigation - 3,530 3,530 Share of profits of associates (1,512) - - Depreciation 3 - 2 Amortisation 22 - 8 Finance costs - 8 8 Investment income (390) - (194) Increase in investments (1,200) (10,800) (12,000) Changes in working capital - Trade and other receivables (29) 4,458 4,367 - Trade and other payables 498 (74) (591) -------------------------------------------- --------- --------- ------------- Net cash generated/(consumed) by operations (2,768) 19,381 16,755 -------------------------------------------- --------- --------- -------------
12. Post balance sheet event
On 25 January 2022 the Company announced a formal bid to acquire the 94.15% of River and Mercantile Group Plc which was not already owned, with River and Mercantile shareholders entitled to receive 0.07392 New AssetCo shares for each River and Mercantile share held. As referred to in the Chairman's statement the acquisition has completed today. The effective acquisition cost is GBP46 million.
13. Electronic communications
This Half-year Report is available on the Company's website www.assetco.com . News updates, regulatory news and financial statements can be viewed and downloaded from the Company's website, www.assetco.com . Copies can also be requested, in writing, from The Company Secretary, AssetCo plc, Singleton Court Business Park, Wonastow Road, Monmouth, Monmouthshire NP25 5JA. The Company is not proposing to bulk print and distribute hard copies of the Half-year Report unless specifically requested by individual shareholders.
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(END) Dow Jones Newswires
June 15, 2022 03:03 ET (07:03 GMT)
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