Ince Group PLC (The) Trading Update (3502M)

TIDMINCE

RNS Number : 3502M

Ince Group PLC (The)

23 May 2022

Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information, as stipulated under the UK Market Abuse Regulation. With the publication of this announcement, this information is now considered to be in the public domain.

The Ince Group plc

("Ince", the "Company" or "Group")

Trading Update

The Board of Ince provides the following trading update following the end of the financial year on 31 March 2022 ("FY22").

As a result of a challenging last quarter of the financial year, overall revenue for FY22 was slightly below the prior year ("FY21") at approximately GBP97m (unaudited). The reasons for the revenue shortfall were:

   --    the resurgence of Covid-19 impacting the UK market from the end of November 2021; 

-- the Covid-19 impact in Hong Kong and People's Republic of China, particularly on our offices in that region;

   --    the Ukraine conflict affecting global shipping, a key market for us; and 

-- a cyber attack at the end of FY22, when the Group was mid-way through IT system migrations in Asia.

Together with some adverse movements in our overheads, this will mean that reported pre-tax profits are expected to be short of market expectations.

Cyber attack

The Group was the victim of a cyber-attack on 13 March 2022, which has meant that the business has had to adapt to difficult operating conditions for a short period of time. Disaster recovery procedures were immediately implemented, including taking some systems offline. A team of specialists was appointed immediately to support the restitution of systems and advise on managing the situation.

Our first concern was to minimise the effect on client work. Once the data loss had been quantified, it was clear that the effects of the attack had principally been on non-client data and our own internal systems, which have now substantially been restored. We continue to investigate the matter and restore some data, but we remain vigilant and have successfully implemented upgrades to our IT systems and controls.

At this time we believe that the overwhelming majority of the costs incurred will be covered by insurance, and although the operating conditions have been difficult, as the systems are now substantially restored we do not believe the effect on the Group's financial performance will be material going forward.

Acquisition of Arden Partners PLC

When we were informed on 6 April 2022 that the London Stock Exchange had notified Arden that its application for continued Nominated Adviser status following a change of control had not been approved, the Boards of each business subsequently assessed the likely impact of this decision and concluded that despite the reduced forecasts, the acquisition still represented good value for Ince shareholders and that the original rationale had not been severely impacted. We were pleased then that the acquisition of Arden subsequently completed on 28 April and we are now starting to capitalise on the identified synergies and cross-selling opportunities.

Publication of Annual Results

As a result of the circumstances outlined above, our final audited results are unlikely to be published before September. Our newly appointed auditors, BDO, are aware of the situation and working closely with us to ensure the financial reporting process remains efficient.

Simon Howard, the Group's Chairman, said : "Since the announcement of the Offer for Arden on 26 October 2021, we have been bound by tight regulatory conditions in terms of communication with our shareholders. For reasons beyond our control the timetable for the Arden offer slipped considerably as we awaited decisions from regulatory authorities. This resulted in an extremely challenging period for management, which was then exacerbated by Covid-19, global market conditions and a cyber-attack in mid-March. The net result is that the Board now anticipates that the final trading results for the year to March 2022 will be behind expectations.

"I am committed to frequent, open and informed communications with shareholders, and to ensuring that the strategy of the Group is understood and embraced by all stakeholders."

Adrian Biles, the Group's CEO, added: "The final quarter of the 2021/22 financial year presented a number of challenges. It had been the Board's intention to complete the Arden acquisition prior to the end of January 2022 but due to regulatory matters this was delayed until after the March 2022 balance sheet date. The UK's Covid-19 lockdown in December 2021 and January 2022 also had a negative effect on financial performance, as did similar issues in Asia, and on top of this, the Group was extremely unfortunate in being victim to a cyber attack in March.

"The hurdles and timetable that were applied to the Arden acquisition caused much frustration. Now completed, we can move forward to pursue our vision and continue to grow our global multi-talented professional services group.

"I would like to take this opportunity to say that I am extremely proud of the way the business and its people have reacted to these challenges".

Enquiries:

 
 The Ince Group plc 
 Adrian Biles, Group Chief Executive          [e-mail] 
 Simon Oakes, Chief Financial Officer 
 
 Allenby Capital Limited - Nominated 
  Adviser                                     [phone] 
 Jeremy Porter / Piers Shimwell, Corporate 
  Finance 
 
 Arden Partners plc - Broker                  [phone] 
 John Llewellyn Lloyd, Corporate Finance 
 Louisa Waddell, Corporate Finance 
 Simon Johnson, Equity Sales 
 
 Williams Nicolson - Financial PR             [phone] 
 Steffan Williams / Fraser Schurer-Lewis      [e-mail] 
 
 

About The Ince Group plc

The Ince Group is a dynamic international legal and professional services business with offices in nine countries across Europe, Asia and the Middle East. With over 700 people, The Ince Group delivers legal advice, strategic guidance and business solutions to clients ranging from the world's oldest and biggest businesses operating across numerous industries to ultra-high net worth individuals. Through its entrepreneurial culture and "one firm" approach, the business offers its clients over 150 years of experience, insight and relationships. The Group is driven by a unique team of passionate people whose broad expertise and deep sector specialisms provide their clients with solutions to all their complex legal and strategic needs.

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May 23, 2022 02:00 ET (06:00 GMT)