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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Impact Holdings | LSE:IHUK | London | Ordinary Share | GB00B3DFYL18 | ORD 50P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 45.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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TIDMIHUK
Impact Holdings (UK) plc
("Impact" or "The Group")
Interim Results
Impact (AIM: IHUK), the specialist lender, announces its unaudited interim
results for the six months ended 30 September 2012.
Financial Highlights
- Cash and cash equivalents of GBP1.09 million (GBP1.37 million 30 September 2011)
- Net assets of GBP5.40million (GBP4.91 million 30 September 2011)
- Debt reduced by 20% year on year to GBP4.73 million (GBP5.90 million September
2011)
- Share issue raised GBP320,000 cash
- Profit after tax of GBP3,726 (GBP141,024 30 September 2011)
- Earnings per share 0.2p (6.3p 30 September 2011)
Operational Highlights
- Ongoing business re-aligned in line with expectations
- Continued reduction in borrowings from financial institutions
- Reduction in operating expenses
- Growth opportunities for new business lines identified
A copy of the interim results is also available on the Group's website
(www.impactholdings.net).
For further information:
Impact Holdings (UK) plc
Paul Davies, Chief Executive Officer Tel: 01928 793 550
Zeus Capital Limited
Andrew Jones, Nick Cowles Tel: 0161 831 1512
CHAIRMAN'S STATEMENT
I am pleased to report our unaudited interim financial results for
the six months ended 30th September 2012. Revenue of GBP425,104 and pre-tax
profit of GBP3,726 were in line with expectations, as the management team
continued its realignment of the business.
The general economic downturn has continued with a further
deterioration in 2012 and a significant lack of confidence in the economy and
a shortage of liquidity in the banking markets which has resulted in a
strategic decision to continue to reduce our indebtedness to financial
institutions.
Business Overview
The Board continues to be concerned at the lack of liquidity in the
banking markets and for the overall economic environment in which we trade.
The consequence of these concerns and our desired strategy of concentrating on
better quality covenants has seen a slowing down of our organic growth within
the solicitor lending business. The Board intends to continue this prudent
strategy until the economic environment returns to a more stable platform.
The business of solicitor lending, in relation to funding
disbursements on personal injury cases, continues to be our core market albeit
we continue to reduce our exposure.
The Board remains committed to diversifying its product offering,
reducing its reliance on speciality funding and re-aligning the business to
provide various ancillary services to the legal and professional sectors. We
are presently well progressed in assessing a number of new initiatives which
will hopefully come to fruition in 2013 and beyond and generate new income
streams.
We continue to incur upfront legal expenses in seeking to recover
loans which have been previously provided against by the Group. A number of
matters have been successfully concluded.
Outlook
The Group remains focussed on providing services to the legal and
professional sectors and maximising niche funding opportunities where the
return profiles look highly attractive. In addition, the management team
continues to analyse various opportunities that will only be executed upon if
they meet our exacting standards for profits growth and shareholder returns.
Roger Barlow
Non-Executive Chairman
IMPACT HOLDINGS (UK) PLC
UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 Months 6 Months Year
ended ended Ended
30/09/2012 30/09/2011 31/03/2012
GBP GBP GBP
Revenue 425,104 848,754 1,186,355
Cost of Sales (112,793) (125,206) (241,816)
Gross profit 312,311 723,548 944,539
Operating expenses (308,585) (582,524) (630,054)
Operating profit 3,726 141,024 314,485
Interest receivable - - 260
Profit for the period from
operations before tax 3,726 141,024 314,745
Tax credit - - (9,721)
Profit for the period 3,726 141,024 305,024
Earnings per share(pence)
Basic 0.2p 6.3p 13.7p
Fully Diluted 0.2p 6.3p 13.4p
IMPACT HOLDINGS (UK) PLC
UNAUDITED CONSOLIDATED BALANCE SHEET
As at As at As at
30/09/2012 30/09/2011 31/03/2012
GBP GBP GBP
Non-current assets
Goodwill 421,766 421,766 421,766
Other intangible assets - 23,311 -
Property, plant and equipment 886,690 612,954 866,825
Deferred taxation 171,892 181,613 171,892
1,480,348 1,239,644 1,460,483
Current assets
Trade and other receivables
including amounts falling
due after more than one year 7,898,230 8,397,545 7,983,892
Cash and cash equivalents 1,095,999 1,374,746 1,076,179
8,994,229 9,772,291 9,060,071
Total assets 10,474,577 11,011,935 10,520,554
Capital and reserves
Share capital 6,411,201 6,211,201 6,211,201
Share premium account 5,125,291 5,005,288 5,005,288
Share based payment reserve - 172,199 -
Shares held by Employee Benefit Trust (45,070) (45,070) (45,070)
Retained earnings (6,091,000) (6,430,925) (6,094,726)
Equity Attributable to equity
shareholders of the parent 5,400,422 4,912,693 5,076,693
Trade and other payables due after more
than one year 548,958 395,955 570,391
Trade and other payables due in less
than one year 4,525,197 5,703,287 4,873,470
10,474,577 11,011,935 10,520,554
IMPACT HOLDINGS (UK) PLC
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE PERIOD
6 Months 6 Months Year
ended ended Ended
30/09/2012 30/09/2011 31/03/2012
GBP GBP GBP
Operating activities
Cash generated from operations 174,014 1,108,068 1,805,382
Income taxes paid - - -
Net cash generated by operating activities 174,014 1,108,068 1,805,382
Investing activities
Purchase of property, plant and equipment (19,865) (15,669) (288,246)
Interest received - - 260
Net cash (used in)/ generated by investing activities (19,865) (15,669) (287,986)
Financing Activities
Decrease in amount owed to
lending institutions (454,332) (1,611,718) (2,335,282)
Issue of shares 320,003 - -
Net cash used in financing activities (134,329) (1,611,718) (2,335,282)
Net (decrease)/increase in
cash and cash equivalents 19,820 (519,319) (817,886)
Opening cash and cash equivalent 1,076,179 1,894,065 1,894,065
Closing cash and cash equivalents 1,095,999 1,374,746 1,076,179
IMPACT HOLDINGS (UK) PLC
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share
based Shares Profit and
Share Share payment held by loss
capital premium reserve EBT account Total
GBP GBP GBP GBP GBP GBP
Balance as at 31 March 2011 6,211,201 5,005,288 172,199 (45,070) (6,571,949) 4,771,699
Lapse of share options - - (172,199) - 172,199 -
Net profit for the year - - - - 305,024 305,024
Balance as at 31 March 2012 6,211,201 5,005,288 - (45,070) (6,094,726) 5,076,693
Shares issued 200,000 120,003 - - - 320,003
Net profit for the period - - - - 3,726 3,726
Balance as at 30 September 2012 6,411,201 5,125,291 - (45,070) (6,091,000) 5,400,422
Notes to the Interim Financial Statements
1. Accounting policies
The financial statements have been prepared in accordance with International
Financial Reporting Standards as endorsed by the EU ("IFRS").
The financial statements have been prepared on the historical cost basis,
except for the revaluation of certain financial instruments. The principal
accounting policies adopted are set out below.
The financial statements have been prepared on a going concern basis.
New and revised accounting standards
The effect of changes on the group's financial statements as a
result of new standards issued since the last reference date is not
significant. The group has elected not to adopt any other standards earlier
than the proposed effective dates.
Further detail in relation to the above International Accounting
Standards is available from the IASB's website, www.iasb.org.
Basis of consolidation
The consolidated financial statements of the Group incorporate the
financial statements of Impact Holdings (UK) plc (the "Company") and
enterprises controlled by the Company (its subsidiaries) made up to the
balance sheet date. Control is achieved where the company has the power to
govern the financial and operating policies of an investee enterprise so as to
obtain economic benefit from its activities. Subsidiaries are fully
consolidated from the effective date of acquisition or up to the effective
date of disposal, as appropriate.
The acquisition method of accounting is used to account for the
acquisition of subsidiaries by the Group. The cost of an acquisition is
measured as the fair value of the assets given, equity instruments issued and
liabilities incurred or assumed at the date of exchange, plus costs directly
attributable to the acquisition. Identifiable assets acquired and liabilities
and contingent liabilities assumed in a business combination are initially
measured at fair value at the acquisition date irrespective of the extent of
any minority interest.
The excess of cost of acquisition over the fair values of the
Group's share of identifiable net assets acquired is recognised as goodwill.
Any deficiency of the cost of acquisition below the fair value of identifiable
net assets acquired (i.e. discount on acquisition) is recognised directly in
the income statement.
Where necessary, adjustments are made to the financial statements
of subsidiaries to bring the accounting policies used into line with those
used by other members of the Group.
All intra-group transactions, balances, and unrealised gains on
transactions between Group companies are eliminated on consolidation.
Unrealised losses are also eliminated unless the transaction provides evidence
of an impairment of the asset transferred.
Goodwill
Goodwill arising on consolidation represents the excess of the cost
of acquisition over the Group's interest in the fair value of the identifiable
assets and liabilities of a subsidiary, associate or jointly controlled entity
at the date of acquisition. Goodwill on acquisition of subsidiaries is
separately disclosed.
Goodwill is recognised as an asset and reviewed for impairment
semi-annually or on such other occasions that events or changes in
circumstances indicate that it might be impaired. Any impairment is recognised
immediately in the income statement and is not subsequently reversed. Goodwill
is allocated to cash generating units for the purpose of impairment testing.
Goodwill arising on acquisitions before the date of transition to
IFRS has been retained at the previous UK GAAP amounts subject to being tested
for impairment.
Intangible assets
The cost of developing or acquiring computer software including own
labour costs incurred directly in connection with software development, is
capitalised as an intangible asset where the related expenditure is separately
identifiable and where there is reasonable expectation that future economic
benefits will arise from the development. Software costs are amortised using
the straight line method over 3 years. The amortisation charge is included
within operating expenses.
Interest income and expense
Revenue shown in the profit and loss account represents interest,
commission and arrangement fees receivable on loans made to third parties.
Interest income and expense are recognised in the profit and loss account for
all financial assets and liabilities using the effective interest method,
being the rate that exactly discounts estimated future cash payments or
receipts through the expected life of the financial instrument to the net
carrying amount of the financial asset or financial liability. When
calculating the effective interest rate, the Group includes all establishment
and arrangement fees, commissions and administrative fees paid or received
between parties to the contract that are an integral part of the effective
interest rate.
Interest on legal disbursement funding is added to the principal,
is calculated on a daily basis and is repaid to the Group at the end of the
term of the agreement.
Amounts received in respect of interest on property bridging loans
relating to future periods are held on the balance sheet as deferred income
within trade and other payables.
Financial assets and liabilities
Financial assets and liabilities used by the Group include loans
made to third parties and debt finance received by the Group. Financial assets
are recognised initially at fair value and measured subsequently at amortised
cost using the effective interest method, less provision for impairment.
Financial liabilities are recognised initially at fair value and measured
subsequently at amortised cost.
Bad and doubtful debts
Specific provision is made against all advances considered to be
impaired. When there is reasonable doubt over recovery, provision is made
against the outstanding debt including interest and further interest is
suspended until the directors are satisfied as to the recoverability of the
total amount due.
Segmental reporting
No separate segmental reporting information is provided as in the
directors' opinion there are no material segments other than the provision of
short term niche funding solutions.
Leasing
Rentals payable under operating leases are charged to income on a
straight line basis over the term of the lease.
Retirement benefits costs
Payments to defined contribution retirement benefit plans are
charged as an expense as they fall due.
Taxation
The tax expense represents the sum of the current tax expense and
deferred tax expense.
The tax currently payable is based on taxable profit or loss for
the year. Taxable profit or loss differs from net profit as reported in the
income statement because it excludes items of income or expense that are
taxable or deductible in other years and it further excludes items that are
never taxable or deductible. The Group's liability for current tax is
calculated by using tax rates that have been enacted or substantively enacted
by the balance sheet date.
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amount of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation
of taxable profit, and is accounted for using the balance sheet liability
method. Deferred tax liabilities are recognised for all taxable temporary
differences and deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which deductible
temporary differences can be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from the initial recognition of
goodwill or from the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction which affects
neither the tax profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries and associates, and
interests in joint ventures, except where the Group is able to control the
reversal of the temporary difference and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred tax is calculated at the tax rates that are expected to
apply to the period when the asset is realised or the liability is settled
based upon tax rates that have been enacted or substantively enacted by the
balance sheet date. Deferred tax is charged or credited in the income
statement, except when it relates to items credited or charged directly to
equity, in which case the deferred tax is also dealt with in equity.
Property, plant and equipment
Fixtures and equipment are stated at cost less accumulated
depreciation. Depreciation is charged so as to write off the cost or valuation
of assets over their useful economics lives, using the straight line method on
the following basis:-
Leasehold improvements - unexpired length of lease
Plant and machinery - 3 years
Fixtures, fittings & equipment - 3 years
The directors consider that the freehold property is maintained in
such a state of repair that its residual value is at least equal to its
carrying value. Accordingly, no depreciation is charged on the grounds of
immateriality. Annual impairment reviews are undertaken and provisions made at
the end of each reporting period where necessary.
Non -depreciation of freehold property is a departure from the
Companies Act 2006 and is considered necessary by the directors to ensure that
the financial statements give a true and fair view.
Equity Instruments
Equity instruments, which are contracts that evidence a residual
interest in the assets of the Group after deducting all of its liabilities,
are recorded at the proceeds received, net of direct issue costs.
Provisions
Provisions are recognised when the Group has a present obligation
as a result of a past event which it is probable will result in an outflow of
economic benefits that can be reliably estimated.
Share-based payments
Equity-settled share-based payments are measured at fair value at
the date of grant. The fair value determined at the grant date of
equity-settled share-based payments is expensed on a straight-line basis over
the vesting period, based on the Group's estimate of shares that will
eventually vest. Fair value is measured by use of a binomial model. The
expected life used in the model has been adjusted, based on management's best
estimate, for the effect of non-transferability, exercise restrictions, and
behavioural considerations.
At each balance sheet date, the Group revises its estimates of the
number of options that are expected to become exercisable. It recognises the
impact of the revision of original estimates, if any, in the income statement
and a corresponding adjustment to reserves over the remaining vesting period.
Costs are recognised in the income statement with a corresponding credit to a
share based payment reserve.
Financial Risk Management
Interest rate risk
The interest rate risks are limited to the revolving credit
facilities which the Group has in place.
The Group has no exposure arising from trading overseas.
Liquidity risk
The Group has to monitor closely its access to bank and other funds
and its ongoing loans and overdrafts to ensure that there are sufficient funds
to meet its obligations.
The Board receives regular debt management forecasts which estimate
the cash inflows and outflows over the next eighteen months, so that
management can ensure that sufficient financing is in place as it is required.
Credit Risk
The Group is exposed to the risk that any counterparty to which the
Group lends money will be unable to repay the amounts when they fall due.
These risks are managed by ensuring that exposures to individual
counterparties and particular market sectors or loans exhibiting particular
attributes are minimized wherever possible. The Board and Risk Committee
monitor such exposures on a regular basis, with figures being regularly
reviewed. In respect of property bridging loans the Group enforces
repossession of property where necessary with a view to holding the asset for
resale in order to extinguish the debt. In addition, impairment provisions are
made when it becomes evident that the Group may incur losses at the balance
sheet date.
2. Earnings per Ordinary A share
6 Months 6 Months Year
ended ended Ended
30/09/2012 30/09/2011 31/03/2012
Profit for the period (GBP) 3,726 141,024 305,024
Average number of shares -
basic and diluted 2,330,094 2,222,402 2,222,402
EPS - basic (pence) 0.2p 6.3p 13.7p
EPS - diluted (pence) 0.2p 6.3p 13.4p
3. Trade and other receivables
30/09/2012 30/09/2011 31/03/2012
GBP GBP GBP
Trade receivables
-Disbursement funding loans 5,998,563 6,899,274 6,544,387
- Property bridging loans 917,547 1,174,297 1,026,832
- Other trade debtors 586,478 86,202 302,914
Prepayments and accrued income 395,642 237,772 109,759
7,898,230 8,397,545 7,983,892
4. Trade and other payables amounts falling due within one year
30/09/2012 30/09/2011 31/03/2012
GBP GBP GBP
Trade and other payables falling due within one year
Trade payables 51,893 54,245 56,086
Bank loans and overdrafts
- Disbursement funding loans 3,818,637 5,038,692 4,218,159
-Property Bridging Loans 334,000 474,000 384,000
-Mortgages 29,156 - 12,533
Other taxation and social security 18,258 17,591 58,569
Accruals and deferred income 273,253 118,759 144,123
4,525,197 5,703,287 4,873,470
Trade and other payables falling due after more than one year
Mortgage 548,958 395,955 570,391
The disbursement funding loans for Sutherland Professional Funding
Limited are financed by committed revolving credit facilities secured by fixed
and floating charges over the assets of the company supported by a parent
company guarantee.
The facility represents individual funding loans, repayable when
the related disbursement loan is collected.
The property bridging loans are uncommitted revolving credit
facilities secured by secondary charges over all properties, where bank
funding has been provided. In addition, there are fixed and floating charges
over all properties and assets, present and future, of Impact Bridging
Solutions Limited supported by a parent company guarantee.
The mortgages are provided by two lenders both of whom have first
charges over the properties concerned.
5. The Board of Directors approved the interim report on 28 December 2012.
END
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