RNS Number:4669B
Ashcourt Holdings PLC
30 July 2004
30 July 2004
Ashcourt Holdings plc
Preliminary Results for the year ended 30 April 2004
("Ashcourt" or "the Company")
Highlights
* Group turnover increased by 75% to #4.56 million (#2.6m** year ended 30
April 2003, #1.7m period from 30 July 2002 to 30 April 2003)
* Group funds under management increased by 91% from #233 million to #444
million as at 30 April 2004 and to #538 million as at 30 June 2004
* Ashcourt Asset Management increased its revenue by 59% during the year
ended 30 April 2004
* Profit before tax of #9,536 (Loss before tax #358,396 - year ended 30
April 2003)
* Profit before tax, depreciation and amortisation of #240,583* (Loss before
tax, depreciation and amortisation of #275,541 - year ended 30 April 2003)
* 86% rise in market capitalisation from #2.8 million to #5.2 million since
its listing on OFEX two years ago
* Introduction to Alternative Investment Market (AIM) 25 June 2004
- Ends -
For further information please contact:
Ashcourt Holdings Plc Parkgreen Communications
John Morton, Chief Executive Officer Justine Howarth/Ana Ribeiro
Tel: 01732 520780 Tel: 020 7493 3713
* Representing profit before tax before deduction of goodwill amortisation of
#152,524 and depreciation of #78,524
** Prior year comparative reflects the results of Ashcourt Asset Management for
the full year, although it was acquired by Ashcourt Holdings on 30 July 2002, on
completion of a group restructuring. Shareholders however benefited from its
results for the entire period.
Chairman's Statement
I am pleased to report that for the first time since Ashcourt was formed in May
2000, global stock markets have provided positive returns over the last twelve
months. During the twelve months under review the FTSE 100 Share Index rose
from 3880.10 on 1 May 2003 to 4489.70 on 30 April 2004, a rise of 15.71%.
Overseas stock markets fared marginally worse over the period largely owing to
the strength of Sterling. The FTA World Index in Sterling terms rose from
207.11 to 240.61, a rise of 16.17%.The improved investment climate has helped
Ashcourt Asset Management to increase its revenue from investment management
fees and dealing activity by 51% during the year. It is also pleasing to report
that the amount of funds under management by the Group as a whole as at 30 April
2004 had grown to #444 million and to #538 million as at 30 June 2004. The most
significant contribution to the increase in the funds under management was the
acquisition of Barney Wilkins and Howard (BWH) in August last year. The core
Ashcourt Asset Management funds under management increased from #233 million to
#272 million over the year, reflecting an improvement in stock market levels
together with a steady flow of new business from existing sources, as well as
the result of acquisitions which have continued into the new trading year.
The improved trading environment together with acquisitions in the year ended 30
April 2004 resulted in Group turnover of #4.56 million compared to Group
turnover for the year ended 30 April 2003 of #2.6 million on a pro-forma, a rise
of 75% (#1.7 million turnover for the period 30 July 2002 to 30 April 2003).
Over the last two years group turnover has more than doubled.
After the losses of last year, I am pleased to report that your Company made a
profit before tax, depreciation and amortisation of #240,583 which compares to a
loss of #275,541 for the period to 30 April 2003. The Board has decided not to
declare a dividend for the current financial year.
As noted above the most significant event of last year was the acquisition of
Barney Wilkins and Howard in August 2003. This business has significantly
strengthened our pensions and financial planning business, Ashcourt Investment
Advisers (AIA), by creating a much greater depth of expertise in a broad range
of financial planning disciplines. The staff were rapidly integrated into our
existing London operations helping to achieve economies of scale. Since the end
of our financial year, your Company has further expanded AIA by the acquisition
in June of Horder & Company for a maximum consideration of #600,000. This is a
further step down the road of achieving the Company's objective of creating a
larger financial planning operation in an attempt to balance out the unavoidable
effects that the volatility of global stock markets has on the revenue of our
investment management business, Ashcourt Asset Management.
During the year under review we have continued to integrate the businesses we
have acquired over the last three years. To this end, in February we decided to
close the small Epsom office we acquired as part of the acquisition of the
financial services division of DMH solicitors (DMH) and to transfer the clients
to a new office at Hightimbers just outside Brighton, where we have also located
the staff who had previously been placed in DMH's Brighton office.
Since the year end your Company has raised an additional #500,000 of capital by
way of a placing with existing shareholders. This was followed by trading in
the Company's shares being transferred from the OFEX market to the Alternative
Investment Market of the London Stock Exchange (AIM). The Company had been
quoted on the OFEX market for nearly two years and seen the share price rise
from 75p to 99.5p and the market capitalisation rise from #2.8 million to #5.2
million, an increase of 86%. Your Board was of the view that the move to AIM
would raise the Company's profile and provide access to the additional capital
necessary to achieve our strategic objectives. Additionally, the admission to
AIM will provide your Company with a more readily tradable stock on a well
respected and rapidly growing market, which your Board believes will be
attractive to both potential investors and to the shareholders of companies that
Ashcourt may consider acquiring.
As the Ashcourt group has expanded and particularly as a result of the Company's
admission to AIM, the Board have concluded that a review of the composition and
responsibilities of the main Board should be undertaken. As a result, I was
pleased to welcome Lisa Felstead to the Board with effect from 1 May 2004 as
Group Chief Operating Officer. This strengthened the executive members of the
Board but still retained a majority of non-executive Board members.
Additionally, an Audit Committee will be established over the next two months,
which will result in your Company having both a Remuneration and an Audit
Committee demonstrating our objective to maintain standards of corporate
governance appropriate to our size and stage of development.
The last twelve months have, once again, put considerable strain on the staff
who have coped admirably with the inevitable pressures associated with the
development of the business both through organic growth and acquisition. I have
no doubt that the next twelve months will be equally challenging, not only with
the integration of our most recent acquisition, Horder & Company, but also the
continued expansion of Ashcourt. I should like to thank everyone for their
considerable efforts in contributing to the development of Ashcourt over the
last twelve months and look forward to the challenges of the coming year.
G G Dearing
Chairman
Chief Executive's Report
The last twelve months have, once again, seen considerable progress in the
development of the Group within a much improved trading environment.
The sharp falls in world stock markets seen during the opening months of 2003
have given way to an improving trend from the start of the period under review.
As a result the trading performance of the Group has improved significantly,
returning to profit for the year ended 30 April 2004.
The improved performance of our asset management business, Ashcourt Asset
Management (AAM), has had a considerable impact on the group's result for the
year to 30 April 2004. Turnover increased by 59% from #2.11 million for the
year ended 30 April 2003 to #3.35 million for the year ended 30 April 2004
reflecting an increased revenue flow from management fees together with
increased dealing activity across both discretionary and advisory portfolios.
This has been complemented by a steady flow of new business that has helped
AAM's funds under management grow during the year to #272 million.
Over the last twelve months AAM has expanded the range of funds it manages with
the acquisition of CF BWH International in August 2003. The investment
performance of all the funds managed by AAM has remained good with each
performing within 2.5% of its benchmark. The performance of Ashcourt Select
Portfolio over the first half of the year was especially pleasing resulting in
an additional performance fee.
A considerable amount of resource has been focused towards improving the
administration capabilities within AAM. Any investment management business must
continue to improve the administration and reporting services provided to both
clients and asset managers. I am pleased to report that these investments in
terms of both management time and financial resource are improving the ability
of asset managers to respond to shifts in world stock markets. The fact that no
fund management business acquisitions occurred during the last twelve months has
also allowed the integration of previous acquisitions to be completed. To this
end, the Chairman has already commented on the closure of our Epsom office and
the transfer of the clients to our new office, north of Brighton, which also
accommodates the asset managers who joined Ashcourt in November 2002, following
the acquisition of the DMH investment business.
Ashcourt Investment Advisers (AIA) significantly increased turnover during the
year under review as a result of the acquisition of BWH in August 2003. The net
contribution to the Group, in terms of profit, was impacted by the inevitable
costs of integrating the two companies, together with the investment needed to
develop a central administration function to facilitate the growth of the
business in the future. The acquisition of BWH almost doubled the size of AIA
giving it much greater depth and expertise in the financial planning industry.
BWH has performed in line with our financial expectations at the time of the
acquisition. However, the impact on the growth and standing of AIA is what has
exceeded our expectations.
We have been able to recruit two additional advisers who bring with them an
established client base which will help to increase AIA's turnover in the coming
twelve months. Additionally, the Board hope to launch the Ashcourt SIPP in the
autumn which should further expand the range of Ashcourt services that can be
offered to our overall client base.
Since the year end the size of AIA has been further expanded by the acquisition
of Horder & Company. The Horder team have already been integrated into the AIA
team in London in new premises in Bucklersbury House and I would like to take
this opportunity to welcome the Horder staff who have joined Ashcourt. This
acquisition was particularly important as it provided the ability to administer
group personal pension schemes from the London office and to be able to add
bespoke mortgage advice to the range of services available across the Ashcourt
Group.
In my report last year, I commented that the outlook for the Group was
encouraging given the possible end to a three year bear market in equities and
the continued concern within the pensions industry. Broadly, I feel the same
factors influence the outlook for the coming twelve months. Equity markets
appear to have regained their composure, but many uncertainties remain that
could influence any significant upwards move in equity prices over the short
term. The pensions industry remains in a state of flux with the recently
announced pensions simplification due to come into force in 2006. The continued
need for individuals to provide for their pensions and more complex investment
products being offered to the investing public only increases the need for
expert independent advice.
Much of the growth of the Ashcourt Group over the last three years has been by
acquisition with little management time or resources spent on marketing. It is
the Board's intention to create a marketing function with the objective of
broadening the sources from which new business is introduced to Ashcourt.
Currently, the majority of our new business comes from existing clients or
introductions from a relatively small number of professional organisations. Our
aim over the coming twelve months is to increase significantly the sources of
new business referrals. At the same time the Board expects to continue to
evaluate acquisitions, but remains committed to ensuring the development of a
broadly based independent wealth management company.
Finally, I should like to add my thanks to all the staff within Ashcourt.
Without their commitment and determination we could not have built the
organisation we have today.
A J Morton
Chief Executive
UNAUDITED CONSOLIDATED PROFIT AND LOSS ACCOUNT
For the year to 30 April 2004
Year to 30 April Period from 30 July
2004 2002 to 30 April
2003
# #
TURNOVER 4,563,797 1,733,061
Administrative expenses (4,494,516) (2,060,645)
OPERATING PROFIT/(LOSS) 69,281 (327,584)
Interest payable and similar charges (59,745) (30,812)
PROFIT/(LOSS) ON ORDINARY ACTIVITIES BEFORE 9,536 (358,396)
TAXATION
Tax on profit/(loss) on ordinary activities (43,000) (3,913)
LOSS ON ORDINARY ACTIVITIES AFTER TAXATION (33,464) (362,309)
Dividends paid and proposed - -
Retained loss (33,464) (362,309)
(LOSS)/EARNINGS PER SHARE
Basic (0.73)p (11.13)p
There are no gains and losses other than those reported in the profit and loss
account.
UNAUDITED CONSOLIDATED BALANCE SHEET
As at 30 April 2004
30 April 2004 30 April 2003
# #
FIXED ASSETS
Intangible assets - goodwill 2,985,776 2,321,583
Tangible assets 209,796 102,841
Other investments 204 203
3,195,776 2,424,627
CURRENT ASSETS
Debtors 1,113,611 835,369
Cash at bank and in hand 247,046 132,497
1,360,657 967,866
CREDITORS: amounts falling due (1,025,595) (634,441)
within one year
NET CURRENT ASSETS 335,062 333,425
TOTAL ASSETS LESS CURRENT LIABILITIES 3,530,838 2,758,052
CREDITORS: amounts falling due after one year (170,956) (299,282)
PROVISIONS FOR LIABILITIES AND CHARGES (9,000) (6,066)
NET ASSETS 3,350,882 2,452,704
CAPITAL AND RESERVES
Called-up ordinary share capital 94,796 84,959
Called-up preference shares 523,802 -
Merger reserve 2,354,321 2,354,321
Share premium account 768,644 370,641
Profit and loss account (395,773) (362,309)
SHAREHOLDERS' FUNDS 3,345,790 2,447,612
Minority interests (including non-equity 5,092 5,092
interests)
TOTAL CAPITAL EMPLOYED 3,350,882 2,452,704
SHAREHOLDERS' FUNDS ARE SPLIT:
Equity interests 2,821,988 2,447,612
Non-equity 523,802
TOTAL SHAREHOLDERS' FUNDS 3,345,790 2,447,612
UNAUDITED CONSOLIDATED CASH FLOW STATEMENT
For the year to 30 April 2004
Year ended Period from 30
30 April July 2002 to
2004 30 April 2003
# #
Net cash inflow/(outflow) from operating activities 196,892 (416,701)
Returns on investments and servicing of finance (59,745) (30,812)
Taxation 12,789 5,267
Capital expenditure and financial investment (95,981) (25,087)
Acquisitions - net cash on acquisition of subsidiary (9,587) 219,298
undertakings
Cash inflow/(outflow) before management of liquid resources
and financing 44,368 (248,035)
Financing 70,181 380,532
Increase in cash in the year 114,549 132,497
NOTES
1. subsequent events
On 3 June 2004 Ashcourt Holdings Plc acquired 100% of the issued share capital
of Horder and Company Limited, a London based fund management and financial
services consultancy. The consideration for the acquisition is as follows:
* #200,000 cash, of which #45,000 was financed by a vendor placing of
Ashcourt shares
* Deferred revenue of up to #400,000 cash payable over a period of up to five
years and tied to gross revenue generated by the Horder business in that
period
A share placing of 500,000 shares at #1 per share was undertaken during May 2004
leading to the total number of shares in issue following the placing to be
5,284,809.
2. SOURCES OF INFORMATION
The financial information set out in this announcement does not constitute the
Company's statutory accounts for the year ended 30 April 2004 or the period
ended 30 April 2003. The financial information for the year ended 30 April 2004
and for the period ended 30 April 2003 is derived from the statutory accounts
for that year which have been delivered to the Registrar of Companies. The
auditors reported on those accounts; their report was unqualified and did not
contain a statement under s237(2) or (3) Companies Act 1985. The statutory
accounts for the year ended 30 April 2004 will be finalised on the basis of the
financial information presented by the directors in this preliminary
announcement and will be delivered to the Registrar of Companies following the
Company's annual general meeting.
3. REPORT AND ACCOUNTS
The Report and Accounts of the Group for the year ended 30 April 2004 will be
sent to shareholders shortly and will be available from our head office at 11
Tower View, Kings Hill, West Malling, Kent, ME19 4UN.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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