TIDMASTO
RNS Number : 8886O
AssetCo PLC
15 June 2022
15 June 2022
AssetCo plc
("AssetCo" or the "Company")
2022 Half-year Report
for the six months ended 31 March 2022
Key highlights
-- Two acquisitions announced to expand AssetCo's listed equity
platform and to build a private markets capability:
o River and Mercantile Group ("RMG")
o Revera Asset Management
-- Progress made at underlying businesses:
o Rize ETF - three additional strategies launched and positive
net inflows in each month
o Saracen Fund Managers - improvement in positioning and
performance
o Parmenion - strong profit growth, with growth prospects
improved through broadening of investment offering
-- Assets under Management: GBP12.2 billion (following
completion of River and Mercantile acquisition)
-- Proposed 13.0p interim dividend expected to be declared in Q4 2022
Campbell Fleming, Chief Executive Officer of AssetCo plc,
commented:
"We have made good progress in developing AssetCo's listed
equity platform, private markets capability and thematic ETF
business. At the same time, Parmenion, which provides investment
solutions to advisers and their clients, has expanded. The current
market environment, alongside the structural shifts taking place
within the asset and wealth management sector, supports a strategy
of building an agile asset and wealth manager, uninhibited by
legacy issues, to meet the needs of investors."
"There is still much to do, but we have the people, products and
the financial strength to deliver for clients and shareholders
alike. We will continue to invest in our existing businesses,
assess strategic opportunities that will add value to our
capabilities, and focus on generating organic growth."
For further information, please contact:
AssetCo plc Numis Securities Limited
Campbell Fleming, CEO Nominated adviser and joint
Peter McKellar, Deputy Chairman broker
James Thorneley, Head of Communications Stephen Westgate / Charles Farquhar/
Tel: +44 (0) 7958 005141 Giles Rolls
Tel: +44 (0) 20 7260 1000
Panmure Gordon (UK) Limited Maitland/AMO
Joint broker Neil Bennett
Charles Leigh-Pemberton / Atholl Rachel Cohen
Tweedie / Gabriel Hamlyn Tel: +44 (0) 20 7379 5151
Tel: +44 (0) 20 7886 2906
For further details, visit the website, www.assetco.com
Ticker: AIM: ASTO.L
CHAIRMAN'S STATEMENT
The six months ended 31 March 2022 was a period of building and
growing, following a transformational financial year for AssetCo,
during which the Company was transformed into an asset and wealth
management business and agreed to acquire interests in four
businesses.
There are numerous structural shifts taking place within the
asset and wealth management industry driven by changing investor
needs, demographics, an evolving approach to savings products, the
use of technology and digitalisation, and a continuing pressure on
fees. These are presenting both challenges and opportunities.
AssetCo is focused on identifying and building on a limited number
of growth opportunities and in unlocking value from the
repositioning of more traditional asset managers. Of particular
relevance are high conviction active equities, ESG/sustainable
strategies and thematic investing, and private markets
capabilities.
Financials
The Income Statement for the six months ended 31 March 2022
shows revenue of GBP1.3 million (31 March 2021: nil) and a loss
before taxation of GBP2.6 million (31 March 2021: profit GBP22.3
million), which is in line with our expectations as we continue to
build the business. The profit in 2021 principally arose from the
final payment received from the successful litigation claim against
Grant Thornton.
Net assets at 31 March 2022 were GBP55.6 million (31 March 2021:
GBP31.1 million). This uplift in net assets includes the investment
gain in RMG shares of GBP1.2 million, where the Company held 5.85%
of the issued equity share capital prior to the acquisition and the
goodwill recognised on investments in Rize ETF and Saracen
totalling GBP19.8 million.
Building Active Equity and Private Markets platforms
In January 2022, the Company announced an offer to acquire River
and Mercantile Group by way of a scheme of arrangement for
effectively GBP95.3 million, to be satisfied by the issue of around
6 million new AssetCo shares. The offer was conditional on the sale
of River and Mercantile's UK Solutions business and a subsequent
GBP190 million return of capital to shareholders, both of which
have now occurred. The acquisition received overwhelming support
from both River and Mercantile and AssetCo shareholders at their
respective General Meetings and has received regulatory approval
from the Financial Conduct Authority. Completion of the acquisition
and the issue of the new AssetCo shares takes place today.
River and Mercantile has an established and well-respected
equities team that manages around GBP2.7 billion of Assets under
Management (AuM). Importantly, the acquisition also provides the
foundation stone to building a private markets business given its
infrastructure investment team.
Significant progress has already been made in terms of
right-sizing the River and Mercantile business post the sale of the
UK Solutions business. Material cost efficiencies have been
identified, with a large proportion being implemented. It is hoped
that, due to the actions being taken both on cost and building new
revenue, River and Mercantile can be returned to profitability by
early 2023.
Separately, in February 2022 the Company announced the
acquisition of Revera Asset Management for GBP2.8 million, to be
satisfied through a mix of new AssetCo shares and cash. Revera has
approximately GBP103 million of AuM and is based in Edinburgh. The
acquisition of Revera is conditional on regulatory approval from
the Financial Conduct Authority, which is expected shortly. The
proposed acquisition of Revera, along with that of Saracen Fund
Managers last year, demonstrates our desire to have a strong
presence in Scotland, given the talent and expertise located
there.
Subject to regulatory approval and completion, River and
Mercantile, Saracen Fund Managers and Revera will form the
Company's listed equity platform, offering a range of UK, smaller
companies, European and Global capabilities. Individual teams will
continue to employ their existing investment processes, but will
benefit from sharing research, ESG analysis, distribution and
marketing resources. This should result in a more efficient and
cost effective platform.
Progress of existing businesses
The last six months has been a challenging period for financial
markets. Despite this, all of the Company's existing businesses
have made good progress.
Since the Company acquired Rize in July 2021, the business has
successfully launched three new thematic strategies - Digital
Payments Economy, Pet Care and Emerging Market Internet and
Ecommerce. The business now offers eight ETFs with total AuM of
$512.9 million and, despite a challenging market environment,
recorded net inflows in each of the six months to 31 March
2022.
During the period under review, Parmenion, a B2B investment and
advisory platform to the UK wealth and IFA sector, broadened the
range of managed portfolio solutions that are available on its
platform. It has added strategies managed by LGT Wealth Management,
Tatton Investment Management and Dimensional. The platform's AuM
was GBP9.4 billion at 31 March 2022, and has been relatively robust
given the volatility in financial markets, but should see growth
over the calendar year.
In May 2022, Parmenion published its annual report and accounts
for the 12 months ended 31 December 2021, which provided a good
overview of the business and its potential. Year-on-year management
and custody fees grew from GBP29.6 million to GBP35.6 million - an
increase of 21%. There was a significant increase in underlying
profit to GBP4.6 million. AuM grew by 17.2%, from GBP8.2 billion to
GBP9.6 billion. Parmenion partners with over 1,500 advisers
providing investment solutions to over 80,000 underlying
clients.
Following the acquisition of Saracen in July 2021, the business
has been relaunched with an updated brand. At 31 March 2022, AuM
was GBP113.2 million.
Capital structure and dividend policy
We intend to write to shareholders shortly with proposals to
instigate a sub-division of the Company's ordinary shares of 10p
each ("Ordinary Shares") on a basis to be determined. Such a
sub-division would increase the number of Ordinary Shares in issue
and the Board believes this would reduce the Company's share price
to a level where smaller sized dealings in Ordinary Shares would be
more efficient. It should also improve the liquidity, spread and
marketability of the Ordinary Shares to a wider group of
investors.
The Board recognises the importance some investors attach to
receiving a regular income from their shareholdings. It is,
therefore, expected that the Company declares a 13.0p interim
dividend in Q4 2022. Thereafter, the Company intends to adopt a
progressive dividend policy.
Board and Corporate Broker
I would like to welcome Jonathan Dawson to the Board further to
the completion of the acquisition of River and Mercantile. Jonathan
was previously Chairman of River and Mercantile. He started his
career in the Ministry of Defence before joining Lazard, the
investment bank, where he spent over 20 years. He left Lazard in
2005 and co-founded Penfida Limited, the leading independent
corporate finance advisor to pension funds. Jonathan's experience
and expertise will be a valuable addition to the Board.
In April, the Company announced the appointment of Numis as
Nominated Adviser and Joint Broker. The Company also appointed
Panmure Gordon as Joint Broker. The Board and I are grateful to the
team at Arden Partners, our former Nominated Adviser, for their
advice and hard work over the years and wish them well for the
future.
Outlook
The Company continues to make good progress in executing on its
strategy. The Company is also in sound financial shape and
following completion of the acquisition of, and return of capital
from, River and Mercantile, the Group will have net cash of more
than GBP45 million.
The acquisition of River and Mercantile results in the Group
having investments in businesses with total AuM of GBP12.2 billion,
with genuine strength in active equities and thematic strategies,
together with an embryonic private markets business. Our aim in
relation to the integration of the businesses is to develop an
operating model which will improve scalability, drive material cost
synergies and strengthen distribution.
Martin Gilbert
Chairman
15 June 2022
AssetCo plc
Consolidated Income Statement
for the six month ended 31 March 2022
Six months ended Year ended
Notes Unaudited Unaudited31 Audited
31 March 2022 March 2021 30 Sept
GBP'000 GBP'000 2021
GBP'000
----------------------------------- ------ --------------------- ---------------- ------------
Revenue 3 1,285 - 408
Cost of sales (1,767) - (536)
------------------------------------------- --------------------- ---------------- ------------
Gross (loss)/profit (482) - (128)
Other income 4 - 22,388 22,388
Administrative expenses (5,261) (766) (7,967)
------------------------------------------- --------------------- ---------------- ------------
Operating (loss)/profit (5,743) 21,622 14,293
Share of net profits of associate
accounted for using equity method 1,512 - -
Investment income 5 1,590 645 1,844
Finance costs - (8) (8)
------------------------------------------- --------------------- ---------------- ------------
(Loss)/profit before income
tax 6 (2,641) 22,259 16,129
Income tax charge 7 - - (1,442)
----------------------------------- ------ --------------------- ---------------- ------------
(Loss)/profit for the year (2,641) 22,259 14,687
------------------------------------------- --------------------- ---------------- ------------
(Loss)/profit attributable
to:
Owners of the parent (2,252) 22,259 14,796
Non-controlling interest (389) - (109)
------------------------------------------- --------------------- ---------------- ------------
(2,641) 22,259 14,687
------------------------------------------ --------------------- ---------------- ------------
Earnings per Ordinary Share Pence Pence Pence
attributable to the owners of
the parent during the year
----------------------------------- ------ --------------------- ---------------- ------------
From continuing operations
Basic 8 (26.73) 284.72 180.57
Diluted 8 (23.91) 284.72 161.05
----------------------------------- ------ --------------------- ---------------- ------------
AssetCo plc
Consolidated Statement of Comprehensive Income
for the six month ended 31 March 2022
Six months ended Year ended
Unaudited Unaudited Audited 30
31 March 2022 31 March Sept 2021
GBP'000 2021 GBP'000
GBP'000
----------------------------------- -------------------- ------------- -----------------
(Loss)/profit for the year (2,641) 22,259 14,687
Other comprehensive (loss)/income:
Currency translation differences - (10) (7)
------------------------------------ -------------------- ------------- -----------------
Other comprehensive income
(net of tax) - (10) (7)
------------------------------------ -------------------- ------------- -----------------
Total comprehensive income
for the period (2,641) 22,249 14,680
------------------------------------ -------------------- ------------- -----------------
Attributable to:
Owners of the parent (2,252) 22,249 14,799
Non-controlling interests (389) - (109)
------------------------------------ -------------------- ------------- -----------------
Total comprehensive income
for the year (2,641) 22,249 14,680
------------------------------------ -------------------- ------------- -----------------
AssetCo plc
Consolidated Statement of Financial Position
as at 31 March 2022
Notes Unaudited Unaudited Audited
31 March 31 March 2021 30 Sept
2022 GBP'000 2021
GBP'000 GBP'000
-------------------------------- ----- ---------- -------------------- --------------
Assets
Non-current assets
Property, plant and equipment 27 - 16
Intangible assets 20,051 - 20,067
Investments accounted for
using the equity method 9 23,383 - -
-------------------------------- ----- ---------- -------------------- --------------
Total non-current assets 43,461 - 20,083
-------------------------------- ----- ---------- -------------------- --------------
Current assets
Trade and other receivables 636 230 607
Financial assets at fair value
through profit and loss 10 13,200 10,800 12,000
Current income tax receivable 3 - 3
Cash and cash equivalents 3,634 21,324 26,902
-------------------------------- ----- ---------- -------------------- --------------
Total current assets 17,473 21,554 39,512
-------------------------------- ----- ---------- -------------------- --------------
Total assets 60,934 32,354 55,595
-------------------------------- ----- ---------- -------------------- --------------
Liabilities
Non-current liabilities
Deferred tax liabilities 49 - 49
-------------------------------- ----- ---------- -------------------- --------------
Total non-current liabilities 49 - 49
-------------------------------- ----- ---------- -------------------- --------------
Current liabilities
Trade and other payables 1,973 1,251 1,972
Loan due to related party 1,000 - -
Current income tax liabilities 1,437 - 1,437
-------------------------------- ----- ---------- -------------------- --------------
Total current liabilities 4,908 1,251 3,409
-------------------------------- ----- ---------- -------------------- --------------
Total liabilities 4,957 1,251 3,458
-------------------------------- ----- ---------- -------------------- --------------
Equity attributable to owners
of the parent
Share capital 843 653 843
Share premium 27,770 3,274 27,770
Capital redemption reserve 653 653 653
Merger reserve 2,762 - 2,762
Other reserves 7,977 - 5,496
Retained earnings 16,640 26,523 18,892
-------------------------------- ----- ---------- -------------------- --------------
56,645 31,103 56,416
Non-controlling interest (668) - (279)
-------------------------------- ----- ---------- -------------------- --------------
Total equity 55,597 31,103 56,137
-------------------------------- ----- ---------- -------------------- --------------
Total equity and liabilities 60,934 32,354 55,595
-------------------------------- ----- ---------- -------------------- --------------
AssetCo plc
Consolidated Cash Flows
for the six month ended 31 March 2022
Six months ended Year ended
Unaudited Unaudited Audited
31 March 31 March 30 Sept
2022 2021 2021
GBP'000 GBP'000 GBP'000
------------------------------------------ --------- --------- ----------
Cash flow from operating activities
Cash generated by operations (note
11) (2,768) 19,381 16,755
Cash released in respect of bonds - 1,126 1,104
Finance costs - (8) (8)
------------------------------------------ --------- --------- ----------
Net cash generated by operating
activities (2,768) 20,499 17,851
------------------------------------------ --------- --------- ----------
Cash flow from investing activities
Payments for acquisition of subsidiaries,
net of cash acquired - - (16,460)
Payments to acquire associated
undertakings (21,871) - -
Dividends received from financial
assets held at fair value 390 - 194
Interest income - - -
Purchase of property, plant and
equipment (14) - (8)
Purchase of intangibles (6) - (1)
------------------------------------------ --------- --------- ----------
Net cash used in investing activities (21,501) - (16,275)
------------------------------------------ --------- --------- ----------
Cash flow from financing activities
Proceeds from issuance of ordinary
shares - - 25,103
Costs of share issue - - (515)
Payments for shares bought back - (26,850) (26,850)
Buy-back transaction costs - (171) (171)
Short-term loan from related party 1,000 - -
------------------------------------------ --------- --------- ----------
Net cash flow from financing
activities 1,000 (27,021) (2,523)
------------------------------------------ --------- --------- ----------
Net change in cash and cash equivalents (23,269) (6,522) (947)
Cash and cash equivalents at beginning
of year 26,902 27,860 27,860
Exchange differences on translation - (14) (11)
------------------------------------------ --------- --------- ----------
Cash and cash equivalents at
end of year 3,633 21,324 26,902
------------------------------------------ --------- --------- ----------
AssetCo plc
Consolidated Statement of Changes in Equity
for the six month ended 31 March 2022
Share Capital
Share premium redemption Merger Other Retained Non-controlling Total
capital account reserve reserve reserve earnings Total interest equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------- ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
At 1 October 2020 1,221 - - - - 31,124) 32,345 - 32,345
Comprehensive
income
Profit for the
period - - - - - 22,259 22,259 - 22,259
Other
comprehensive
income/(expense)
Currency
translation
differences - - - - - (10) (10) - (10)
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
Total
comprehensive
income - - - - - 22,249 22,249 - 22,249
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
Share-based
payments
- success fee 85 3,445 - - - - 3,530 - 3,530
Share buy-back (653) - 653 - - (26,850) (26,850) - (26,850)
Costs of share
buy-back - - - - - (171) (171) -` (171)
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
At 31 March 2021 653 3,445 653 - - 26,352 31,103 - 31,103
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
Comprehensive
income
Loss for the
period - - - - - (7,463) (7,463) (109) (7,572)
Other
comprehensive
income
Currency
translation
differences - - - - - (3) (3) - (3)
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
Total
comprehensive
(loss) - - - - - (7,460) (7,460) (109) (7,569)
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
Proceeds from
share
issue 173 24,840 - - - - 25,013 - 25,013
Costs of share
issue - (515) - - - - (515) - (515)
Shares issued on
acquisition 17 - - 2,762 - - 2,779 - 2,779
Share-based
payments
- LTIP - - - - 5,496 - 5,496 - 5,496
Non-controlling
interest on
acquisition - - - - - - - (170) (170)
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
At 30 September
2021 843 27,770 653 2,762 5,496 18,892 56,416 (279) 56,137
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
Comprehensive
income
Loss for the
period - - - - - (2,252) (2,252) (389) (2,641)
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
Total
comprehensive
(loss) - - - - - (2,252) (2,252) (389) (2,641)
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
Share-based
payments
- LTIP - - - - 2,481 - 2,481 - 2,481
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
At 31 March 2022 843 27,770 653 2,762 7,977 16,640 56,6456 (668) 55,977
------------------ ------- ------- ----------- --------- --------- ---------- ------------ ----------------- -----------
NOTES FORMING PART OF THE INTERIM FINANCIAL STATEMENTS
1. General information and basis of presentation
AssetCo Plc ("AssetCo" or the "Company") is a public limited
company incorporated and domiciled in England and Wales. The
address of its registered office is Singleton Court Business Park,
Wonastow Road, Monmouth, Monmouthshire, NP25 5JA.
The Group's principal activity is the development of an asset
and wealth management business.
The financial information in the Half-year Report has been
prepared using the recognition and measurement principles of the
international accounting standards in conformity with the
requirements of the Companies Act 2006 ("IFRS"). The principal
accounting policies used in preparing the Half-year Report are
those the Company expects to apply in its financial statements for
the year ending 30 September 2022 and are unchanged from those
disclosed in the Annual Report and Financial Statements for the
year ended 30 September 2021 with the exception that following the
acquisition of 30% of Parmenion Capital Partners LLP on 1 October
2021 the Group has adopted IFRS 10 in respect of accounting for
Associated undertakings.
The financial information for the six months ended 31 March 2022
and the six months ended 31 March 2021 is unaudited and does not
constitute the Group's statutory financial statements for those
periods. The comparative financial information for the full year
ended 30 September 2021 has, however, been derived from the audited
statutory financial statements for that period. A copy of those
statutory financial statements has been delivered to the Registrar
of Companies.
While the financial figures included in this Half-year Report
have been computed in accordance with IFRSs applicable to interim
periods, this Half-year Report does not contain sufficient
information to constitute an interim financial report as that term
is defined in IAS 34.
The financial statements have been presented in sterling to the
nearest thousand pounds (GBP'000), except where otherwise indicated
.
2. Going concern
At the time of approving the financial statements, the Directors
have a reasonable expectation that the Company and Group have
adequate resources to continue in operational existence for the
foreseeable future. Accordingly, they continue to adopt the going
concern basis in preparing the financial statements.
3. Segmental reporting
The core principle of IFRS 8 'Operating segments' is to require
an entity to disclose information that enables users of the
financial statements to evaluate the nature and financial effects
of the business activities in which the entity engages and the
economic environments in which it operates. Segment information is
therefore presented in respect of the company's commercial
competencies, Active Specialists, High-Growth Thematics and Digital
Platforms and Head Office Costs.
All revenues are earned in the UK. The Directors consider that
the chief operating decision maker is the Board.
The amounts provided to the Board with respect to net assets are
measured in a manner consistent with that of the financial
statements. The Company is domiciled in the UK and also operated
out of a branch in UAE. Unallocated comprises the assets and
liabilities of AssetCo, including the UAE business with Head Office
costs identified separately.
The segment information provided to the Board for the reportable
segments is as follows:
Period ended Digital
31 March 2022 Active High-growth platforms
unaudited specialists thematics Head office Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ ------------ ----------- ---------- ----------- ----------- --------
Revenue
Management fees 424 - - - - 424
Marketing fees - 861 - - - 861
------------------------ ------------ ----------- ---------- ----------- ----------- --------
Total revenue 424 861 - - - 1,285
------------------------ ------------ ----------- ---------- ----------- ----------- --------
Operating result
before adjustments (6) (1,229) 1,512 (969) - (692)
Share-based payments
- LTIP - - - - (2,493) (2,493)
Exceptional costs - - - - (1,046) (1,046)
------------------------ ------------ ----------- ---------- ----------- ----------- --------
Operating profit/(loss) (6) (1,229) 1,512 (969) (3,539) (4,231)
Investment income - - - - 1,590 1,590
Finance costs - - - - - -
------------------------ ------------ ----------- ---------- ----------- ----------- --------
Profit/(loss)
before tax (6) (1,229) 1,512 (969) (1,949) (2,641)
Income tax - - - - - -
------------------------ ------------ ----------- ---------- ----------- ----------- --------
Profit/(loss)
for the year (6) (1,229) 1,512 (969) (1,949) (2,641)
------------------------ ------------ ----------- ---------- ----------- ----------- --------
Segment assets
Total assets 3,523 20,346 23,383 - 14,682 60,934
Total liabilities (48) (304) - - (4,604) (4,956)
------------------------ ------------ ----------- ---------- ----------- ----------- --------
Total net assets 3,475 20,042 23,383 - 10,078 55,978
------------------------ ------------ ----------- ---------- ----------- ----------- --------
Depreciation - 3 - - - 3
Amortisation 2 20 - - - 22
Total capital
expenditure - 20 - - - 20
Period ended
31 March 2021 Active High-growth Digital Head
unaudited specialists thematics platforms office Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ ------------ ----------- ---------- ------- ----------- -------
Revenue
Management fees - - - - - -
Marketing fees - - - - - -
------------------------ ------------ ----------- ---------- ------- ----------- -------
Total revenue - - - - - -
------------------------ ------------ ----------- ---------- ------- ----------- -------
Operating result
before adjustments - - - (460) - (460)
Other income - - - - 22,388 22,388
Share-based payments
- LTIP - - - - - -
Exceptional costs - - - - (306) (306)
------------------------ ------------ ----------- ---------- ------- ----------- -------
Operating profit/(loss) - - - (460) 22,082 21,622
Investment income - - - - 645 645
Finance costs - - - - (8) (8)
------------------------ ------------ ----------- ---------- ------- ----------- -------
Profit before
tax - - - (460) 22,719 22,259
Income tax - - - - - -
------------------------ ------------ ----------- ---------- ------- ----------- -------
Retained profit - - - (460) 22,719 22,259
------------------------ ------------ ----------- ---------- ------- ----------- -------
Segment assets
Total assets - - - - 32,354 32,354
Total liabilities - - - - (1,251) (1,251)
------------------------ ------------ ----------- ---------- ------- ----------- -------
Total net assets - - - - 31,103 31,103
------------------------ ------------ ----------- ---------- ------- ----------- -------
Total capital
expenditure - - - - - -
Year ended 30
September 2021 Active High-growth Digital Head
audited specialists thematics platforms office Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ ------------ ----------- ---------- ------- ----------- --------
Revenue
Management fees 135 - - - - 408
Marketing fees - 273 - - - 273
------------------------ ------------ ----------- ---------- ------- ----------- --------
Total revenue 135 273 - - - 408
------------------------ ------------ ----------- ---------- ------- ----------- --------
Operating result
before adjustments 32 (347) - (1,147) - (1,516)
Other income - - - - 22,388 22,388
Share-based payments
- LTIP - - - (6,273) (6,273)
Exceptional costs - - - - (360) (360)
------------------------ ------------ ----------- ---------- ------- ----------- --------
Operating profit/(loss) 32 (347) - (1,147) 15,755 14,293
Investment income - - - - 1,844 1,844
Finance costs - - - - (8) (8)
------------------------ ------------ ----------- ---------- ------- ----------- --------
Profit/(loss)
before tax 32 (347) - (1,147) 17,591 16,129
Income tax (6) 1 - - (1,437) (1,442)
------------------------ ------------ ----------- ---------- ------- ----------- --------
Profit/(loss)
for the year 26 (346) - (1,147) 16,154 14,687
------------------------ ------------ ----------- ---------- ------- ----------- --------
Segment assets
Total assets 3,518 21,712 - - 34,335 59,595
Total liabilities (85) (471) - - (2,902) (3,458)
------------------------ ------------ ----------- ---------- ------- ----------- --------
Total net assets 3,433 21,271 - - 31,433 56,137
------------------------ ------------ ----------- ---------- ------- ----------- --------
Depreciation - 2 - - - 2
Amortisation 1 7 - - - 8
Total capital
expenditure 3 5 - - - 8
4. Other income
Six months ended Year ended
Unaudited Unaudited Audited
31 March 31 March 30 September
2022 2021 2021
GBP'000 GBP'000 GBP'000
-------------------------- --------- ------------ -------------
Grant Thornton litigation - 25,918 25,918
Success fee - (3,530) (3,530)
-------------------------- --------- ------------ -------------
- 22,388 22,388
-------------------------- --------- ------------ -------------
The case against Grant Thornton was concluded successfully in
the financial year 2021. The total award came to GBP30.515 million,
of which GBP4.597 million was reflected in the 2020 full year
accounts, as it had been awarded by the Courts irrespective of the
outcome of any appeal. Other income shown in these accounts
represents the balance of the Court's award, less the success fee
of 15% of claim proceeds excluding costs.
5. Investment income
Six months ended Year ended
Unaudited Unaudited Audited
31 March 31 March 30 September
2022 2021 2021
GBP'000 GBP'000 GBP'000
------------------------------------------ --------- ------------ -------------
Fair value gains on financial instruments
classified as fair value through
profit and loss 1,200 450 1,650
Dividend income 390 195 195
------------------------------------------ --------- ------------ -------------
1,590 645 1,845
------------------------------------------ --------- ------------ -------------
6. Adjusted profit
Six months ended Year ended
Unaudited Unaudited Audited
31 March 31 March 30 September
2022 2021 2021
GBP'000 GBP'000 GBP'000
------------------------------------------- ---------- ---------- --------------
Reported pre-tax (loss)/profit (2,641) 22,259 16,129
Add back:
Other income - Grant Thornton litigation - (22,388) (22,388)
Share-based payments - LTIP 2,493 - 6,273
Exceptional costs related to re-admission
documents 1,046 306 360
Adjusted pre-tax profit 898 177 374
------------------------------------------- ---------- ---------- --------------
The Group has grown rapidly since shareholder approval was given
to change its strategy in April 2021. Because of AssetCo's
relatively low market capitalisation at the outset of its growth
journey it has required two re-admission circulars. Prior to the
change in strategy the Group had successfully concluded the
long-running litigation against its former auditor, Grant Thornton,
resulting in a significant settlement which, net of related costs,
gave rise to an Other Income figure of GBP22.388 million.
These items, together with a new incentivisation scheme for
management in the form of the LTIP, have perhaps masked the
underlying progress of the business's results. Accordingly, we have
set out above the Group's pre-tax result adjusted for the three
items mentioned.
7. Income tax charge
Six months ended Year ended
Unaudited Unaudited Audited
31 March 31 March 30 September
2022 GBP'000 2021 GBP'000 2021 GBP'000
-------------------------------------- ------------- ------------- -------------
Current tax:
Current tax on profit for the year - - 1,437
-------------------------------------- ------------- ------------- -------------
Total current tax - - 1,437
Deferred tax:
Arising from movement in deferred tax
assets (228) - (307)
Arising from movement in deferred tax
liabilities 228 - 312
-------------------------------------- ------------- ------------- -------------
Total deferred tax - - 5
-------------------------------------- ------------- ------------- -------------
Income tax charge - - 1,442
-------------------------------------- ------------- ------------- -------------
8. Earnings per share
Basic earnings per share is calculated by dividing the profit
attributable to equity owners of the parent by the weighted average
number of Ordinary Shares in issue during the period.
Diluted earnings per share is calculated by adjusting the
weighted average number of Ordinary Shares outstanding assuming
conversion of all dilutive potential Ordinary Shares. The Company
has one category of dilutive potential Ordinary Shares, being
shares allocated to the LTIP pool.
Six months ended Year ended
Unaudited Unaudited Audited
31 March 31 March 30 September
2022 2021 2021
GBP'000 GBP'000 GBP'000
--------------------------------------- --------- --------- -------------
(Loss)/profit attributable to owners
of the parent (2,252) 22,259 14,796
--------------------------------------- --------- --------- -------------
No: No: No:
Weighted average number of ordinary
shares in issue 8,424,847 7,817,964 8,194,031
Effect of dilutive potential ordinary
shares 993,315 - 993,315
--------------------------------------- --------- --------- -------------
Weighted average number of ordinary
shares - diluted 9,418,162 7,817,964 9,187,346
--------------------------------------- --------- --------- -------------
Pence Pence Pence
Basic (26.73) 284.72 180.57
Diluted (23.91) 284.72 161.05
9. Investments accounted for using the equity method
On 1 October 2021 the Group acquired a 30% stake in Parmenion
Capital Partners LLP for a purchase price of GBP21.9 million. The
investment is accounted for using the equity method and a
reconciliation of the cost of investment and accumulated results of
Parmenion is set out below:
Six months ended Year ended
Unaudited Unaudited Audited
31 March 31 March 30 September
2022 2021 2021
GBP'000 GBP'000 GBP'000
---------------------------------- --------- ------------ -------------
At start of period - - -
Cost of investment 21,871 - -
Share of net profits of associate
using equity method 1,512 - -
---------------------------------- --------- ------------ -------------
At end of period 23,383 - -
---------------------------------- --------- ------------ -------------
10. Financial assets at fair value through profit and loss
At 31 March 2022 the Group held 5,000,000 shares in River and
Mercantile Group Plc and the fair value at that date is recognised
here. The six months to 31 March 2022 shows a fair value gain of
GBP1.2 million (see note 5). The Group has also received dividends
amounting to GBP390,000 in the period (see note 5). As we report in
the Chairman's statement and note 12 we have today announced the
completion of the acquisition of River and Mercantile Group Plc so
from today's date the investment will be accounted for as a
business combination.
11. Cash generated by operations
Six months ended Year ended
Unaudited Unaudited Audited
31 March 31 March 30 September
2022 2021 2021
GBP'000 GBP'000 GBP'000
-------------------------------------------- --------- --------- -------------
(2,641
(Loss)/profit before tax ) 22,259 16,129
Adjustments for:
Share-based payments
- LTIP 2,481 - 5,496
- Success fee on Grant Thornton litigation - 3,530 3,530
Share of profits of associates (1,512) - -
Depreciation 3 - 2
Amortisation 22 - 8
Finance costs - 8 8
Investment income (390) - (194)
Increase in investments (1,200) (10,800) (12,000)
Changes in working capital
- Trade and other receivables (29) 4,458 4,367
- Trade and other payables 498 (74) (591)
-------------------------------------------- --------- --------- -------------
Net cash generated/(consumed) by operations (2,768) 19,381 16,755
-------------------------------------------- --------- --------- -------------
12. Post balance sheet event
On 25 January 2022 the Company announced a formal bid to acquire
the 94.15% of River and Mercantile Group Plc which was not already
owned, with River and Mercantile shareholders entitled to receive
0.07392 New AssetCo shares for each River and Mercantile share
held. As referred to in the Chairman's statement the acquisition
has completed today. The effective acquisition cost is GBP46
million.
13. Electronic communications
This Half-year Report is available on the Company's website
www.assetco.com . News updates, regulatory news and financial
statements can be viewed and downloaded from the Company's website,
www.assetco.com . Copies can also be requested, in writing, from
The Company Secretary, AssetCo plc, Singleton Court Business Park,
Wonastow Road, Monmouth, Monmouthshire NP25 5JA. The Company is not
proposing to bulk print and distribute hard copies of the Half-year
Report unless specifically requested by individual
shareholders.
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END
IR BKQBKCBKDBAD
(END) Dow Jones Newswires
June 15, 2022 03:03 ET (07:03 GMT)
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