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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:1503J Ultimate Finance Group PLC 01 March 2005 Embargoed until 07:00 1st March 2005 Ultimate Finance Group plc ("the Company" or "Ultimate Finance") Interim results for the six months ended 31 December 2004 Highlights: * Turnover for the period up 79% to #992,000 (2003: #554,000) * Funds advanced up almost 106% to #7.0 million (2003: #3.4m) * 50 net new clients on board up 63% to 130 retained clients at period end (2003: 80) * A further 14 new clients added to the portfolio in January with strong pipeline building * Losses reduced significantly with a move into profit expected in the current year * Cost remain tightly controlled * Sales capability strengthened with senior regional sales director appointment * Directors confident of further growth in 2005 Brian Sumner, chief executive, commented: "I am delighted with this set of results which represents significant progress for the group. We have reduced our losses, grown our client base and are well positioned to move into profitability in the short term. Our target market offers tremendous growth opportunities for the group and we are well positioned to take maximum advantage." Enquiries: Brian Sumner, Chief Executive Ultimate Finance Group plc 07976 406 474 Richard Pepler, Managing Director Ultimate Finance Group plc 07870 212 180 Shane Dolan Biddicks 020 7448 1000 Chairman's statement Results Results for the period ended 31 December 2004 show a loss before taxation of #37,000, a considerable improvement compared with a loss of #166,000 for the six months to 31 December 2003. In the same period, turnover was #992,000 against #554,000 for the six months to 31 December 2003. Client turnover in the period amounted to #36.1 million (31 December 2003: #18.2 million). 44 new clients were taken on during the period and, after client losses, the portfolio of clients stood at 130 clients at 31 December 2004 (31 December 2003: 80). Aggregate advances across the portfolio at the end of the period reached #7.0 million (31 December 2003: #3.4 million). The cost base continues to be contained with the sole justification for increase being to meet the demands of a growing portfolio and expanding business. Working Capital Facilities The #14 million debt facility from Lloyds TSB has provided the group with the flexibility it promised. Bigger investments, faster decision making and less onerous administration has been a major contributor to the continued success of Ultimate Finance. Of the total funding facility available to us, #5.1 million (net) has been utilised as at 31 December 2004 (31 December 2003: #2.4 million). People As always, the board recognise the importance of an experienced, well-trained and dedicated workforce. The success of Ultimate Finance is entirely attributable to this committed team. In support of the increase in staff numbers, the head office, which was previously located in serviced offices in Bristol moved to its own dedicated, larger premises at the beginning of the financial year. The incremental cost of these premises is negligible and I am pleased to report that the business will benefit considerably from increasing economies of scale over the next two years. Risk management With high standards of underwriting, experienced client management and credit control staff, risk management continues to be the primary focus for control in the business. Our clients continue to offer an excellent spread of risk in terms of size of investment, industry type and geographical location. The single largest investment at the end of December 2004 was #322,000, which constituted less than 7% of total funds advanced. Outlook These results demonstrate further evidence of the strength of Ultimate's offer in a growing market place. Our commitment to building sustainable shareholder value through investment in all facets of our business is delivering results in accordance with our expectations. Current performance is in line with expectations and the board look forward to the future with confidence. I would like to take this opportunity to thank our Chief Executive, Brian Sumner and his staff for their efforts and continued commitment to the success of the group. Clive R Garston Chairman Chief Executive's review Introduction At the end of the last financial year (30 June 2004), the portfolio had grown by almost 80% from 59 at the end of June 2003 to 106 clients. In the first six months of the current financial year a further 44 new clients were added to the portfolio and after clients exiting, the total number of live clients at 31 December 2004 increased to 130. The increasing size of the portfolio reflects a wide range of business activities, located throughout England and Wales. The last year has been a breakthrough period for Ultimate Finance, one in which I feel we have really cemented our position as a proactive finance house, willing and able to meet the needs of today's SME with a level of personal service that our competitors are finding it difficult to match. The ability of our highly experienced new business team to structure deals quickly that work well for the client and then deliver a high quality personal service with full access to the decision makers is providing us with significant client wins. The additional funding raised in May of last year has provided the foundation for continued, controlled growth of the portfolio and provide much greater flexibility to write new and bigger business; this is the key to our future growth potential. People In support of our growth ambition, we have recently recruited a third regional sales director, Peter Stanton, who has taken responsibility for the Midlands with effect from September 2004. Peter has a great deal of experience of structuring factoring and invoice discounting deals, recently with IGF, and is well known in the region. He has already established a new client base for us and is currently performing well ahead of his targets. Our client management team has been strengthened by the addition of three credit controllers taking the operations department to 12 staff at the end of the half-year (31 December 2003: 9). The total number of staff employed by the group at the end of December 2004 was 22 (31 December 2003: 16). I fully recognise that our staff are our greatest asset and we have been fortunate to be able to assemble such an excellent group of professionals who are all behind our core strategy. I would like to add my own thanks to my co-directors and all our staff for their hard work and commitment since forming the group. Darren Newman, our excellent Financial Controller from day one of the business, has now been appointed Finance Director of the group - a much-deserved appointment. I would also like to thank Clive Garston and our non-executive board directors whose collective experience and encouragement is extremely valuable to us. We are also greatly appreciative of all our introducers of business who range from specialist brokers to accountants and business consultants. Risk management Risk management alongside the provision of a high quality service continues to form the core element of business management within Ultimate Finance. High standards of selection for recruitment combined with continuous training programs are regarded as a corner stone of best practice. This applies to new business staff as well as operations staff. The quality of our staff together with the strength of our underwriting procedures continue to reward us with a well spread and stable portfolio. Ongoing development of our core infrastructure and systems enable us to successfully cope with the increasing demands made upon it. One thing is for sure, however, that as we grow, we are determined not to lose the personal touch. At 31 December 2004 total debts under management were #13.4 million (31 December 2003: #6.3 million), against which we had advanced a total of #7.0 million (31 December 2003: #3.4 million). Our main target market is businesses with an annual turnover of up to #5 million but ranges from quality, well thought out start ups to long established, mature, medium sized businesses. FDA I am delighted to announce we were recently accepted as the latest member of the trade association, the Factors and Discounters Association. It is very gratifying to have gained acceptance by our peers. Our products and the marketplace Our product range is soon to be supplemented by the addition of our new debt protection scheme, which I am sure, will be of great interest to many of our clients and potential clients. The market for factoring and invoice discounting products is far from saturated with less than 40,000 companies using the products against an estimated potential number in excess of 200,000. The products are more and more accepted as part of the financial scene and we believe the market in them will continue to grow at the expense of the more traditional bank overdraft. Conclusion The portfolio has been augmented by a further 14 clients (net of losses) in the month of January 2005. It is our intention to further increase the sales team in the near future assuring the business of continued growth. With a growing market to attack, a determined management team focussed on growth, and the strength of resource concentrated on risk management and high levels of service, I am confident that the future of Ultimate Finance is secure. Brian Sumner Chief Executive Independent Review Report by KPMG Audit Plc to Ultimate Finance Group plc Introduction We have been engaged by the company to review the financial information set out in the consolidated profit and loss account, the consolidated balance sheet, the reconciliation of movements in shareholders' funds, the consolidated cash flow statement, the reconciliation of net cash flow to movement in net funds, the reconciliation of operating profit / (loss) to net operating cash flows and the notes to the interim report and we have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. This report is made solely to the company in accordance with the terms of our engagement. Our review has been undertaken so that we might state to the company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company for our review work, for this report, or for the conclusions we have reached. Director's responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim report in accordance with the AIM Rules which require that the interim report must be presented and prepared in a form consistent with that which will be adopted in the company's annual accounts having regard to the accounting standards applicable to such annual accounts. Review work performed We conducted our review having regard to the guidance contained in Bulletin 1999 /4: Review of interim financial information issued by the Auditing Practices Board for use in the United Kingdom. A review consists principally of making enquiries of group management and applying analytical procedures to the financial information and underlying financial data and, based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review is substantially less in scope than an audit performed in accordance with Auditing Standards and therefore provides a lower level of assurance than an audit. Accordingly we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the six months ended 31 December 2004. KPMG Audit Plc Chartered Accountants 1 The Embankment Neville Street Leeds LS1 4DW 28 February 2005 Consolidated profit and loss account Half year to Half year to Year to 31 Dec 04 31 Dec 03 30 Jun 04 #'000 #'000 #'000 Turnover 992 554 1,184 Administrative expenses (883) (650) (1,357) Operating Loss 109 (96) (173) Other interest receivable and similar income 3 2 5 Interest payable and similar charges (149) (72) (171) Loss before and after taxation (37) (166) (339) Basic and fully diluted loss per share (0.18)p (1.48)p (2.72)p There are no recognised gains and losses in the period other than those reported in the profit and loss account. Consolidated balance sheet Half year to Half year to Year to 31 Dec 04 31 Dec 03 30 Jun 04 #'000 #'000 #'000 Fixed Assets 98 30 43 Current Assets Debtors (see note 5) 7,088 3,439 5,220 Cash at bank 267 580 327 7,355 4,019 5,547 Current Liabilities Amounts due in less than one year (5,543) (3,100) (3,643) Net current assets 1,812 919 1,904 Net assets 1,910 949 1,947 Shareholders' funds Called up share capital 1,000 561 1,000 Share premium account 1,949 1,217 1,949 Profit and loss account (1,039) (829) (1,002) Total shareholders' funds 1,910 949 1,947 Reconciliation of movements in shareholders' funds Half year to Half year to Year to 31 Dec 04 31 Dec 03 30 Jun 04 #'000 #'000 #'000 Opening shareholders' funds 1,947 1,115 1,115 New share capital subscribed (net of issue costs) - - 1,171 Loss for the period (37) (166) (339) Closing shareholders' funds 1,910 949 1,947 Consolidated cash flow statement Half year to Half year to Year to 31 Dec 04 31 Dec 03 30 Jun 04 #'000 #'000 #'000 Net cash flow from operating activities (1,722) (616) (2,444) Returns on investments & servicing of finance (146) (70) (166) Capital expenditure (69) (6) (27) Cash outflow before financing (1,937) (692) (2,637) Financing Issue of shares - - 1,171 Increase in debt 1,877 900 1,094 (Decrease) / Increase in cash (60) 208 (372) Reconciliation of net cash flow to movement in net funds Half year to Half year to Year to 31 Dec 04 31 Dec 03 30 Jun 04 #'000 #'000 #'000 (Decrease) / Increase in cash (60) 208 (372) Cash inflow from increase in debt (1,877) (900) (1,094) Movement in net debt in the period (1,937) (692) (1,466) Net debt at the beginning of the period (3,143) (1,677) (1,677) Net debt at the end of the period (5,080) (2,369) (3,143) Reconciliation of operating profit / (loss) to net operating cash flows Half year to Half year to Year to 31 Dec 04 31 Dec 03 30 Jun 04 #'000 #'000 #'000 Operating profit / (loss) 109 (96) (173) Depreciation charges 14 6 14 Increase in commitments to clients (1,877) (565) (2,274) Decrease / (Increase) in sundry debtors 9 10 (62) Increase in provisions against client commitments 26 31 17 (Decrease) / Increase in sundry creditors (3) (2) 34 Net cash outflow from operating activities (1,722) (616) (2,444) Notes to the interim report 1. The results for the half year to 31 December 2004 and the comparative six month trading period to 31 December 2003 are unaudited and have been prepared using accounting policies consistent with those set out in the Directors' Report and Consolidated Financial Statements for the period ended 30 June 2004. The figures for the financial period ended 30 June 2004 are taken from the statutory accounts for that period, which have been delivered to the Registrar of Companies and upon which an unqualified audit report was given. 2. The basic loss per share has been calculated from the loss after taxation of #37,000 and on the 19,997,018 ordinary shares in issue at 31 December 2004. As the company has made a loss in the period the basic loss per share is the same as the fully diluted loss per share, therefore, the calculation does not take into consideration share options granted in the period. 3. These interim financial statements were approved by the board of directors on 28 February 2005. 4. Accounting policies The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the company's financial statements. Basis of preparation These unaudited financial statements do not constitute statutory accounts. They have, however, been reviewed by the auditors whose report is included. The financial statements have been prepared in accordance with applicable accounting standards, and under the historical cost accounting rules. Fixed assets and depreciation Depreciation is provided to write-off the cost less the estimated residual value of tangible fixed assets by equal instalments over their estimated useful economic lives as follows: Office equipment incl. network equipment - 5 years Computer equipment excl. network equipment - 3 years. Turnover Turnover represents fees (excluding value added tax) and discount income. Fees are recognised when service is provided and discount income is recognised on funds advanced to clients as it becomes due. Cash and liquid resources Cash, for the purpose of the cash flow statement, comprises cash in hand and deposits repayable on demand, less overdrafts payable on demand. Introducer commissions Commissions payable to the introducers of business are charged to the profit and loss account over the minimum period of the service contract. In the event of early termination, any commission not already charged to the profit and loss account will be written off in full. Net client commitments Amounts due to clients under recourse factoring agreements are offset against the related trade debtors. The resulting balance represents net client commitments and is included in debtors. 5. Debtors Half year to Half year to Year to 31 Dec 04 31 Dec 03 30 Jun 04 #'000 #'000 #'000 Gross factored debts receivable 13,394 6,342 8,974 Due to clients on collection (6,425) (2,959) (3,882) Client Commitments 6,969 3,383 5,092 Other debtors 32 11 20 Prepayments and accrued income 87 45 108 Debtors 7,088 3,439 5,220 6. Taxation No taxation arose due to the losses incurred in the period. The group has accumulated tax losses available for offset against future profits of #1,055,000 (31 December 2003: #835,000). A deferred tax asset of #305,000 (31 December 2003: #244,000) has not been recognised as the directors do not believe that it is more probable than not that it will recover a material amount in the next 12 months. 7. Interim Report Copies of this report are being sent to shareholders. Additional copies may be obtained from the Ultimate Finance Group plc registered office: Bradley Pavilions, Pear Tree Road, Bradley Stoke, Bristol BS32 0BQ. This information is provided by RNS The company news service from the London Stock Exchange END IR VVLFLELBBBBV
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