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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Ultimate Fin. | LSE:UFG | London | Ordinary Share | GB0031685414 | ORD 5P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 25.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
RNS Number:2732Q Ultimate Finance Group PLC 29 September 2003 Ultimate Finance Group plc 29 September 2003 For immediate release Preliminary Statement of Results for the period from 10 January 2002 to 30 June 2003 Ultimate Finance Group plc ("Ultimate Finance", "the company" or "the group") was admitted on AIM in June 2002 as a newly formed business and commenced trading at that time The Group offers recourse factoring, bulk factoring, confidential invoice discounting, credit insurance and trade finance services Key points: *The Board are pleased to be in a position to announce that the group's first year objectives have been met. * From a start-up position with no clients, a period of initial losses was anticipated whilst establishing our core infrastructure. * Turnover for the period was #485,000 and the operating loss, which was in line with expectations, was #655,000. Overheads have been rigidly controlled throughout the period. * Client turnover factored or discounted during the period amounted to #18.4m. * As each new client is won, the contribution to overhead increases. The #459,000 loss for the period to 31 December 2002 compares with a loss of #196,000 for the six months to 30 June 2003. * 95% of revenue has been derived from recourse factoring business with approximately 5% generated from confidential invoice discounting. * Risk management systems are operated by experienced and well-qualified staff. No bad debts were incurred during the period. * The group had gained a well spread portfolio of 59 clients at the period end and, having established its position in the market place, the directors view the group's future with confidence. Press enquiries: Brian Sumner, Chief Executive Ultimate Finance Group plc +44 (0) 7976 406 474 Chairman's statement Results I am delighted to report that notwithstanding the difficult economic conditions prevailing in the UK since the admission of your company's share capital to AIM on 12 June 2002, Ultimate's business has performed well and delivered a solid performance in line with our original expectations. Since trading commenced, the company has secured a well spread portfolio of 59 clients. Our recourse factoring products accounted for 95% of the group's turnover in the period with the remaining 5% being confidential invoice discounting. The turnover for the period was #485,117 reflecting significant growth in the last six months. Overheads were almost constant during the whole period and amounted to #1,140,077. The loss on ordinary activities before taxation was #663,083 and the loss per share was 5.91p. During the period the company financed sales of #18.4m. At 30 June 2003 factored debt stood at #5.1m against which #2.8m was advanced to clients. Of the total availability under the Bank of Scotland revolving credit facility, #2.1m had been drawn down with #2.3m being unutilised. Staffing levels have increased during the period as the number of clients and debtors have increased. At the end of the year, staff numbers totalled 13. During the last six months of the period, the company increased its geographical spread with the recruitment of a senior executive with responsibility for the south-east of England. This together with the two offices operating in Bristol and Greater Manchester leads me to believe that the business is well positioned to achieve continued growth in its target markets. Directors During the course of the trading period Mark Harris joined the Board as a non-executive director. He is a chartered accountant with a background in corporate finance and banking. He is, currently, chief executive of Glenmore Investments Limited one of the group's major shareholders. I welcome him to the Board and am grateful to him for the knowledge and experience he brings to it. Mark has also accepted the role as chairman of the audit committee. Thanks I am grateful to all my colleagues on the Board for their consistent support and guidance throughout the year and to our chief executive, Brian Sumner, and his executive team for successfully establishing the company's business on a firm foundation. I would like to say thank you to all the employees of Ultimate for their dedication, support and continuing efforts. Their professionalism and quality will play a key role in the group's future success. Finally, I would like to thank our shareholders for their patience. We are dedicated to providing shareholder value. Outlook Notwithstanding the difficulty that many UK businesses are currently experiencing as a result of an uncertain political and economic climate, the market for factoring and discounting continues to grow. Ultimate Finance is ideally placed to capitalise on this growth. Clive R Garston Chairman Chief Executive's review Introduction Our factoring and invoice discounting services provide small and medium-sized businesses with a highly flexible form of funding. Funds are not restricted (as with a normal bank overdraft) by a formula based on the assets or net worth on a balance sheet. This flexibility is driving the demand for factoring and discounting products at the expense of the traditional bank overdraft. As a result our target market is growing strongly, despite uncertain economic and political conditions, affording significant business opportunities for the group in the future, particularly given our flexible approach and commitment to personal service. The group's client portfolio is currently in line with expectations and reflects a wide range of business activities, located throughout England and Wales, served from the company's offices in Bristol and the Greater Manchester area. Main products Our recourse factoring products account for over 95% of the group's turnover. Funding is provided, in most cases up to 80% of approved debts, on a continuing basis together with debt collection and sales ledger management for the full factoring service. If the prospect's internal credit control function is considered effective and efficient our Bulk Factoring solution may be offered or alternatively a service where the clients manage their own telephone chase up. Confidential invoice discounting, currently some 5% of the book, offers cash flow finance in a similar way to factoring. The differences are that the arrangement is not disclosed to the debtors, the client continues to run its own sales ledger as it is usually equipped to do so, and the client's balance sheet, administration and financial management tend to be stronger than the average factoring client. Trade finance and debtor insurance are offered to our clients through close partnerships with specialist providers. No risk accrues to the group through theses activities. Performance As each new client is won, the accumulating client list results in increasing turnover and cash generation. Turnover from a new client taken on towards the end of a reporting period has little impact on the results for that period, but makes a greater contribution to future results. The effect of this can be seen by comparing the turnover and operating loss for the period from 12 June 2002, when trading commenced, to 31 December 2002 with the results for the six months to 30 June 2003: For the period from 12 June 2002 For the period from 1 January 2003 to 31 December 2002 to 30 June 2003 #000 #000 Turnover 127 358 Operating Loss (459) (196) The generation of income from existing clients for the whole of the next reporting period, combined with the impact of net new clients' contribution for part of it, gives the Board confidence that the end of the predicted early loss making phase of your company's initial development is in sight. People Our commitment to a personal service ethic is setting us apart from our main competitors. I fully recognise that our staff are our greatest asset and we have been fortunate to be able to assemble an excellent team of industry professionals. I would like to add my own thanks to them for all their hard work and commitment since forming the group. Risk management Experienced and well-qualified staff, together with strong systems, processes and procedures have been introduced throughout the business to ensure that risk management benefits from the industry's best practice. Tried and tested portfolio management techniques continue to be applied to reduce risk wherever possible. We have successfully managed risk during the period whilst continuing to provide the top class service expected by our clients. No bad debts have been experienced during the year. We are continuing to build and develop our core infrastructure and systems to cope successfully with the increasing demands made upon it. Our target market is smaller sized businesses and to spread the risk our funds are utilised across a diversified portfolio of clients. At 30 June 2003 total debts under management were #5.1m, against which we had advanced a total of #2.8m. The future We have now built a solid foundation on which to grow the group robustly in the future. The market for factoring and discounting continues to grow giving us increasing numbers of good quality opportunities to win business. We fully expect to continue gaining business at the expense of some of our larger and less flexible competitors through the combination of a well-structured solution at a competitive price with the onus on high service levels. Brian Sumner Chief Executive Consolidated profit and loss account for the period from 10 January 2002 to 30 June 2003 2003 # Turnover 485,117 Administrative expenses (1,140,077) ------------- Operating loss (654,960) Other interest receivable and similar income 22,722 Interest payable and similar charges (30,845) ------------- Loss on ordinary activities before taxation (663,083) Tax on profit on ordinary activities - ------------- Loss on ordinary activities after taxation (663,083) ============= Basic and fully diluted loss per share (note 5) (5.91)p ============= All amounts relate to continuing activities. Trading commenced on 12 June 2002 and the above results relate to the activities carried out since that date. The company was dormant for the period from incorporation on 10 January 2002 to 12 June 2002, being the date its shares were admitted to AIM. There are no recognised gains or losses in the period except those reported above. Consolidated balance sheet At 30 June 2003 Note 2003 # Fixed assets Tangible assets 29,566 Current assets Debtors 1 2,883,433 Cash at bank and in hand 404,130 ------------- 3,287,563 Creditors: amounts falling due within one year 2 (2,202,381) ------------- Net current assets 1,085,182 ------------- Net assets 1,114,748 ============= Capital and reserves Called up share capital 3 561,169 Share premium account 1,216,662 Profit and loss account (663,083) ------------- Shareholders' funds (all equity) 1,114,748 ============= These financial statements were approved by the Board of directors on 26 September 2003. Consolidated cash flow statement for the period from 10 January 2002 to 30 June 2003 Note 2003 # Reconciliation of operating loss to net cash flow from operating activities Operating loss (654,960) Depreciation charges 8,607 Increase in debtors (2,883,433) Increase in creditors 120,753 ------------- Net cash outflow from operating activities (3,409,033) ============= Cash flow statement Cash flow from operating activities (3,409,033) Returns on investments and servicing of finance 4 (8,123) Capital expenditure 4 (38,173) ------------- Cash outflow before financing (3,455,329) Financing 4 3,827,831 ------------- Increase in cash in the period 372,502 ============= Reconciliation of net cash flow to movement in net debt Increase in cash in the period 372,502 Cash inflow from debt in the period (2,050,000) ------------- Movement in net debt in the period (1,677,498) Net debt at the start of the period - ------------- Net debt at the end of the period (1,677,498) ============= Reconciliation of movements in shareholders' funds for the period from 10 January 2002 to 30 June 2003 Group 2003 # Loss for the period (663,083) New share capital subscribed (net of issue costs) 1,777,831 ---------------- Net addition to shareholders' funds 1,114,748 Opening shareholders' funds - ---------------- Closing shareholders' funds 1,114,748 ================ On incorporation, the authorised share capital of the company was #50,000 divided into 50,000 ordinary shares of #1 each ("Old Shares") of which 2 were in issue, fully paid or credited as fully paid. On 28 May 2002, by or pursuant to resolutions of the company passed on that date each of the Old Shares was sub-divided into 20 ordinary shares and the authorised share capital of the company was increased from #50,000 to #1,000,000 by the creation of an additional 15,360,000 ordinary shares and 3,640,000 redeemable preference shares of 5p each (the "Redeemable Preference Shares") On 28 May 2002, C R Garston, B R Sumner, R J Pepler, J H Coombes, D F Ashford and R E M Lee were allotted 100,000, 1,000,000, 800,000, 700,000, 20,000 and 20,000 Redeemable Preference Shares respectively and W.H. Ireland Group plc and Glenmore Investments Limited were allotted 918,850 and 81,150 Redeemable Preference Shares respectively, in each case at 5p per share. On 11 June 2002 all the Redeemable Preference Shares were converted into and redesignated as ordinary shares pursuant to the company's articles of association. On 12 June 2002 11,223,372 ordinary shares were issued at 24p. In addition there were outstanding options under the non-Inland Revenue share option scheme over 300,000 ordinary shares as detailed on page 8 of this report and warrants to subscribe for 561,165 ordinary shares initially issuable as to 112,233 to Dawnay, Day Corporate Finance Limited and as to 448,932 to W.H. Ireland Group plc. Each warrant entitles the holder to subscribe for one ordinary share at 24p. The warrants are transferable and must be exercised between 11 June 2004 and 11 June 2009. Notes 5 Debtors Group 2003 # Gross factored debts receivable 5,126,860 Due to clients on collection (2,309,101) ---------------- Client commitments 2,817,759 Other debtors 13,922 Prepayments and accrued income 51,752 ---------------- 2,883,433 ================ 6 Creditors: amounts falling due within one year Group 2003 # Bank loans and overdrafts 2,081,628 Trade creditors 31,612 Taxation and social security 34,037 Other creditors 39,687 Accruals and deferred income 15,417 ---------------- 2,202,381 ================ 7 Called up share capital 2003 # Authorised Equity: 20,000,000 ordinary shares of 5p each 1,000,000 ================ Allotted, called up and fully paid Equity: 11,223,372 ordinary shares of 5p each 561,169 ================ 8 Analysis of cash flows 2003 # Returns on investment and servicing of finance Interest received 22,722 Interest paid (30,845) ---------------- (8,123) ================ Capital expenditure and financial investment Purchase of tangible fixed assets (38,173) ---------------- (38,173) ================ Financing Issue of ordinary share capital 2,002,000 Expenses paid in connection with share issue (224,169) Utilisation of revolving credit facility 2,050,000 ---------------- 3,827,831 ================ 9 Earnings per share The basic loss per share for the period to 30 June 2003 has been calculated from the loss on ordinary activities after taxation of #663,083 and on the 11,223,372 ordinary shares in issue at 30 June 2003. The fully diluted loss per share for the period to 30 June 2003 is shown as the same value as basic earnings per share, since the average market value of the company's shares during the period is below the average option price and the options are therefore not considered to have a diluting effect. 10 Preliminary statement This preliminary statement was approved by the Board on 26 September 2003. It is not the company's statutory accounts. The statutory accounts for the period ended 30 June 2003 have been audited and have been approved by the Board of directors on 26 September 2003. Copies of the Directors' report and consolidated financial statements will be sent to all shareholders shortly and will be available from the Group's Bristol office, 1st Floor, Aztec Centre, Aztec West, Almondsbury, Bristol BS32 4TD. This information is provided by RNS The company news service from the London Stock Exchange END FR SELFSUSDSESU
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