TIDMKWG
RNS Number : 5145Z
Kingswood Holdings Limited
15 September 2022
Half-year Report
Kingswood Holdings Limited ("Kingswood") continues to make
strong progress against strategic objectives and is well positioned
to accelerate the delivery of medium-term targets
-- Following record results in 2021, revenue has further grown
by 31% in H1'22 (vs H1'21) and operating profit by 47% increasing
by GBP1.5m to GBP4.5m confirming the resilience of the business
with a highly scalable platform
-- UK trading in line with expectations and has completed 6
acquisitions so far in 2022, adding GBP2.8m annual operating profit
and c.GBP0.9bn Assets under Management and Advice (AUM/A) to the
Group. Kingswood has also signed Heads of Terms or is in exclusive
discussions with a further 8 UK & Ireland businesses, most of
which it expects to conclude in this financial and calendar
year
-- Kingswood US increased the number of registered
representatives in its Registered Investment Adviser (RIA) and
Independent Broker Dealer (IBD) business by 6% in the first six
months of the year, supporting growth in AUM/A by $0.2bn to
c.$2.7bn
-- A complementary focus on organic growth is now delivering a
positive trajectory across all operating segments in H1'22
-- Kingswood now manages GBP9.3bn of client assets, an increase
of 37% compared to December 2021
Kingswood Holdings Limited (AIM: KWG), the international, fully
integrated wealth and investment management group, is pleased to
announce its unaudited interim financial results for the half year
ended 30 June 2022.
David Lawrence, Kingswood Chief Executive Officer, commented :
"We delivered record levels of revenue and operating profit in all
3 of our Divisions in 2021 and I am delighted to report further
growth in the first half of 2022. Whilst the business continues to
build momentum through 2022, revenue and operating profit have been
impacted by unfavourable market conditions, mainly from lower than
expected capital market activity in the US. Despite this, our
business continues to grow organically in both the UK and US and
our acquisition strategy continues to progress as planned.
We have continued to implement our buy, build and grow strategy
in the UK, successfully completing the acquisition of 6 UK IFA
businesses and have a strong pipeline for future UK acquisitions. I
would like to welcome our 6 recently acquired businesses to the
Kingswood Group and wish them every success with us moving
forwards. Under the leadership of Mike Nessim, we have also
continued to expand our US footprint adding 12 new registered
representatives and growing our AUM by $0.2bn.
Whilst the external environment is less certain in the
short-term, the strategy and trajectory of the business continues
as planned. We have a strong leadership team that is driving
tangible results and realising our ambition to become a leading
fully integrated international wealth & investment management
business and I would like to thank all colleagues and stakeholders
for their effort, focus and commitment."
Strategic Highlights
-- UK AUM/A increased by GBP2.2bn to GBP7.1bn in H1'22 largely
driven by inorganic growth and positive net flows of assets under
our management and advice (AUM/A)
-- We completed the acquisition of 6 UK IFA businesses in the
first half of the year which have been successfully integrated into
the Group's operations within 4 months
-- 8 UK acquisitions are currently in exclusive due diligence,
comprising a total of GBP8.7m annual operating profit and GBP1.9bn
AUM/A. These are expected to conclude in the fourth quarter of
2022
-- Kingswood places the client at the heart of everything we do
and we are extremely proud to have 4.8 stars out of 5 on
VouchedFor, home to the UK's most trusted advisers
-- Technology has been successfully deployed in the business to
improve the client experience and productivity. Following the
launch of our market leading 'Kingswood Go' app in March 2022, over
1,300 clients have now registered providing them with easier access
to their investment portfolio. Further investments in technology
will deliver an enhanced experience for the client including
digital fact finds and new propositions that will provide both a
face to face and a digitally delivered service
-- As we build a business more representative of our society,
good progress has been made to address diversity imbalances across
the organisation - 60% of UK adviser hires in 2022 were female
compared to an adviser community where c.15% of our advisers are
female
-- Kingswood US has continued to grow organically through the
accelerated recruitment of registered representatives, which
supported an 8% increase in AUM/A to $2.7bn
-- The US business continues to build on the exceptional growth
experienced in its Investment Banking operating segment during
2021, recruiting two new high quality IB groups in H1'22 focussed
on mid-market equity capital markets
Financial Highlights
-- Group revenue of GBP80.4m increased by GBP18.8m, or 31%,
compared to H1'21 reflecting the impact of acquisitions and healthy
organic growth across both the UK and US
-- Wealth Planning revenue of GBP12.9m increased by 55% compared
to H1'21 reflecting the impact of our recent acquisitions and
organic revenue growth from higher new volumes of new business.
Investment Management revenue of GBP3.6m also increased by 55%
compared to the prior year due to the acquisition of IBOSS Asset
Management, with positive net inflows also seen in our Fixed Income
business
-- US revenue of GBP63.9m increased by 26% compared to H1'21.
Recurring revenues increased from 7% in 2021 to 13% in H1 2022. The
Registered Investment Adviser (RIA) and Independent Broker Dealer
(IBD) business reported revenue was GBP8.0m, 189% higher than
H1'21, as an increase in the number of registered representatives
by 12 to 223 supported growth in AUM by $0.2bn to $2.7bn.
Investment Banking (IB) revenue of GBP55.9m increased by 16%
compared to H1'21 reflecting a strong performance in the first
quarter. IB revenue in the second quarter fell by 20%
year-over-year as macro-economic headwinds and market volatility
led to a slowdown in capital market activity, as demonstrated by a
fall in the number of IPOs in the Americas region by 73% compared
to H1'21. On a like for like currency basis, US revenue increased
by 17% to $82.7m compared to H1'21
-- Operating Expenditure of GBP15.6m increased by 46% compared
to H1'21 largely reflecting the impact of acquisitions in the UK
(GBP2.9m) and higher costs in Kingswood US (GBP1.5m) due to higher
legal, compliance and regulatory costs. Central costs increased by
(GBP0.5m) to GBP2.8m reflecting investment to support a growing
business and higher professional fees
-- Operating Profit of GBP4.5m was GBP1.5m higher than H1'21
reflecting the additional contributions from the recently acquired
businesses. The Kingswood Board believes Operating Profit is the
most appropriate indicator to explain the underlying performance of
the Group. The definition of Operating Profit is profit before
finance costs, amortisation and depreciation, gains and losses, and
exceptional costs (business re-positioning and transaction
costs)
-- Profit before Tax for the period was a Loss of GBP1.7m
reflecting a net GBP6.3m acquisition related deferred consideration
release offset by GBP1.9m amortisation and depreciation, GBP1.5m
finance (interest related) costs, GBP2.8m business re-positioning
and transaction costs and a goodwill adjustment of GBP6.4m
-- The Group had GBP20.7m of cash as at June 2022, a decrease of
GBP22.2m since December 2021, largely driven by acquisition related
payments in the UK and timing of the settlement of Investment
Banking commission payments in the US
GBP'000 (unless otherwise Change
stated) H1'22 H1'21 %
--------------------------- -------- -------- -------
Wealth Management 12,864 8,307 55%
Investment Management 3,588 2,312 55%
Kingswood US 63,937 50,922 26%
Total Revenue 80,389 61,541 31%
Recurring Revenue 28% 19% n/a
Kingswood UK (WM + IM) 5,810 2,830 105%
Kingswood US 1,529 2,519 (39)%
Division Operating Profit 7,339 5,349 37%
Central Costs (2,834) (2,294) 24%
Operating Profit 4,505 3,055 47%
GBP'000 (unless otherwise Change
stated) H1'22 FY'21 %
--------------------------- -------- -------- -------
Total Equity 75,608 76,898 (2)%
Total Cash 20,693 42,933 (52)%
Key Metrics
AUM/A (GBPm) 9,288 6,772 37%
# of UK Advisers 87 70 24%
# of US RIA/IBD reps 223 211 6%
Change of Auditor
During H1 2022 Kingswood Holdings Limited embarked on a tender
process to undertake future audit activity. Our existing auditor
BDO LLP ("BDO") did not participate in this process. BDO LLP
("BDO") have subsequently resigned as the Group's auditor and the
Board has approved the appointment of PKF Littlejohn ("PKF") as the
Group's new external auditor. PKF will conduct the audit of the
Group's financial statements for the financial period to 31
December 2022. BDO has submitted to the Company, in accordance with
Companies (Guernsey) Law, 2008, a letter stating its reason for
resigning. A copy of BDO's letter has, in accordance with section
274 of the Companies (Guernsey) Law, 2008, today been shared with
all shareholders on the Company's website, along with an
explanatory letter from Kingswood Holdings Limited.
Outlook
Our near-term target remains to build our UK AUM/A to in excess
of GBP10bn and GBP12.5bn globally, and we are building a pipeline
to deliver a proforma GBP20m Operating Profit through a combination
of acquisitions and organic growth.
Whilst external factors continue to impact the business,
Kingswood's resilience has been demonstrated through a solid
performance in the first half of the year. We have made good
progress against our UK inorganic growth strategy and have
generated pleasing organic revenue growth across the Group. The UK
business has proven to have sticky, long-term recurring revenues
that are not directly correlated to market performance. In the
second half of the year, we expect further organic growth and
positive net inflows and it remains well positioned as financial
markets recover. The transactional nature of US Investment Banking
revenues means that its revenue and profit will be dependent on the
levels of capital market activity.
Looking ahead we remain confident in the success of our
ambitious long-term growth strategy grounded in supporting our
clients to protect and grow their wealth.
Company Registration No. 42316 (Guernsey)
KINGSWOOD HOLDINGS LIMITED
CONSOLIDATED INTERIM UNAUDITED FINANCIAL STATEMENTS
FOR THE SIX MONTH PERIODED 30 JUNE 2022
KINGSWOOD HOLDINGS LIMITED
CONTENTS
Page
Financial and Operational Review 1 - 2
Interim Consolidated Statement of Comprehensive Income 3 - 4
Interim Consolidated Statement of Financial Position 5 - 6
Interim Consolidated Statement of Changes in Equity 7 - 8
Interim Consolidated Statement of Cash Flows 9
Notes to the Interim Consolidated Financial Statements 10 - 26
KINGSWOOD HOLDINGS LIMITED
FINANCIAL AND OPERATIONAL REVIEW
FOR THE PERIODED 30 JUNE 2022
Group Review:
The business has continued to build momentum in 2022 and revenue
and operating profit have grown despite unfavourable market
conditions. Our business continues to grow organically in both the
UK and US and our acquisition strategy continues to progress as
planned. We have a strong leadership team that is driving tangible
results and realising our ambition to become a leading fully
integrated International wealth & investment management
business.
Finance Review:
Despite the continued macro-economic uncertainty and volatility,
Kingswood has delivered double-digit revenue and operating profit
growth in the first half of the year. AUM/A is now GBP9.3bn and we
are reporting organic revenue growth in the business.
We continue to see the benefits of our buy, build and grow
strategy, completing a further 6 acquisitions in 2022 that will
continue the growth trajectory into 2023 and beyond. The Kingswood
Board continues to focus on ensuring that they maintain and deliver
a robust Balance Sheet with a view to ensuring no deferred
liability remains uncovered from a funding perspective. Our focus
is to maximise shareholder returns through Operating Profit growth
combined with minimising our weighted average cost of capital.
Group revenue of GBP80.4m increased by 31% compared to H1'21,
with double digit growth across all operating segments. Wealth
Planning revenue increased by 55% to GBP12.9m and Investment
Management revenue increased by 55% to GBP3.6m, driven by GBP4.5m
and GBP1.1m growth through acquisitions respectively. Organic
revenue growth across the UK segments demonstrates the synergies
generated through our vertically integrated growth strategy.
US revenues of GBP63.9m increased by 26% compared to H1'21.
Recurring revenues increased from 7% in 2021 to 13% in H1 2022. The
Registered Investment Adviser (RIA) and Independent Broker Dealer
(IBD) business reported revenue was GBP8.0m, 189% higher than
H1'21, as an increase in the number of registered representatives
by 12 to 223 supported growth in AUM by $0.2bn to $2.7bn.
Investment Banking (IB) revenue of GBP55.9m increased by 16%
compared to H1'21 reflecting a strong performance in the first
quarter. IB revenue in the second quarter fell by 20%
year-over-year as macro-economic headwinds and market volatility
led to a slowdown in capital market activity, as demonstrated by a
fall in the number of IPOs in the Americas region by 73% compared
to H1'21.
Operating Profit for the period was GBP4.5m, an increase of
GBP1.5m compared to the prior year, reflecting the impact of
acquisitions the underlying business dynamics. An increase in
central costs of GBP0.5m to GBP2.8m largely reflects an increase in
the central resources required to support a larger business and
one-off professional fees.
Profit before Tax for the period was a Loss of GBP1.7m
reflecting a net GBP6.3m acquisition related deferred consideration
release offset by GBP1.9m amortisation and depreciation, GBP1.5m
finance (interest related) costs, GBP2.8m business re-positioning
and transaction costs and a goodwill adjustment of GBP6.4m.
The Group had GBP20.7m of cash as at June 2022, a decrease of
GBP22.2m compared to December 2021. This is largely driven by
acquisition related payments and a timing impact of the settlement
of Investment Banking commission payments in the US. Net Assets as
at 30 June 2022 were GBP75.6m, a decrease of GBP1.3m compared to
December 2021.
Our near-term target remains to build our UK AUM/A in excess of
GBP10bn and GBP12.5bn globally, and we are building a pipeline to
deliver a proforma GBP20m Operating Profit through a combination of
acquisitions and organic growth. Although we continue to operate
within an uncertain macroeconomic environment looking ahead, we
remain confident in the success of our ambitious long-term growth
strategy grounded in supporting our clients to protect and grow
their wealth.
UK Highlights:
Kingswood UK has delivered a solid financial performance in
H1'22, with revenue and operating profit increasing by 55% and 105%
year-over year respectively.
We successfully completed the acquisition of 6 UK IFA
businesses, with all 2022 acquisitions now fully integrated into
the Group's operations and there is a healthy pipeline of future
acquisition opportunities at various stages of study and
negotiation, including 8 currently in exclusive due diligence
comprising a total of GBP8.7m annual operating profit and GBP1.9bn
AUM/A. These transactions are expected to conclude in the fourth
quarter of 2022.
Total UK revenue of GBP16.5m in H1'22, was GBP5.8m higher
compared to the same period last year and with 86% of revenues
being recurring in nature this provides the strong, annuity style
fee stream required to deliver sustainable, long term returns to
our shareholders.
We expect organic growth in both initial and ongoing fees post
integration through accretive assets under influence and, despite
the first half of 2022 bringing with it both a decline in global
markets and inflationary pressures, the UK business generated
positive organic revenue growth in H1'22. Organic growth is
delivered through agreements with professional introducers who
recommend Kingswood to their clients, digital channels including
SEO and Google ads, a greater share of wallet through
adviser-client meetings and vertical integration.
The Advisory model demonstrated resilience during COVID and
remains resilient in the current period. Clients tend to seek
advice in periods of market volatility and the adviser-client
relationship is the stickiest part of the value chain. Despite a
decline in global markets our clients are typically invested for
the long term, with assets tied up in diversified portfolios.
The hard work and dedication of all our staff has enabled us to
continually deliver against our buy, build and grow strategy at
pace whilst maintaining the highest levels of service and
experience for our clients, as reflected in our most recent
'Vouchedfor' rating of 4.8 / 5.0.
US Highlights:
We maintain a robust recruitment pipeline of new advisers, with
a particular focus on developing predictable and recurring revenue
streams from the advice and management of our client assets and the
first half of 2022 we further expanded our US footprint by adding
12 new registered representatives and growing our AUM/A by $0.2bn.
Our brand recognition continues to develop within the market, and
we are seeing increasing levels of referrals from within our
current adviser base. This has enabled us to continually build a
strong pipeline of new advisers and we expect to onboard a further
10 reps managing c.$300m AUM/A in 2022.
Kingswood US revenue of $82.7m in the first half of the year
increased by $12.0m or 17% compared to the same period last year.
Operating profit decreased by $1.5m to $2.0m compared to H1'21. The
decrease in operating profit has largely been driven by an increase
in operating expenses related to non-recurring professional fees
and higher staff commission payments for the recruitment of reps,
which we will begin to see revenue generation from over H2'22.
In the second half of the year, we expect our financial
performance to continue to be impacted by market movements and
capital market activity in the US. The transactional nature of US
Investment Banking revenues means that they will be dependent on
the levels of capital market activity. Through investment in the
business we remain well positioned as financial markets begin to
recover.
We remain confident in the success of our long term growth
strategy of acquiring small to medium size IBD/RIA firms and
recruiting independent financial advisers through a superior wealth
management platform, supporting practice offering and by removing
the management and regulatory burden to enable advisers to focus on
growing their client base. In turn this will continue to increase
our levels of recurring revenues and drive improved margins.
Six months Six months Year ended
to to
30 June 2022 30 June 31 Dec 2021
2021
(unaudited) (unaudited) (audited)
Notes GBP'000 GBP'000 GBP'000
Revenue 3 80,389 61,541 149,716
Direct expenses (60,330) (47,824) (120,497)
Gross profit 20,059 13,717 29,219
Operating staff costs (10,283) (7,631) (15,157)
Other operating costs (5,271) (3,031) (7,735)
Total operating costs (15,554) (10,662) (22,892)
Operating profit 4,505 3,055 6,327
Non-operating costs:
Business re-positioning costs (1,202) (407) (1,564)
Finance costs (1,455) (840) (4,927)
Amortisation and depreciation (1,863) (1,117) (2,399)
Acquisition-related items:
Other (losses) / gains 4 - - (3,056)
Remuneration charge (deferred
consideration) 10 6,309 (4,145) (7,009)
Goodwill adjustment 8 (6,364) - -
Transaction costs (1,621) (274) (1,836)
Loss before tax (1,691) (3,728) (14,464)
Tax (139) 3 (761)
Loss after tax (1,830) (3,725) (15,225)
Other comprehensive income /
(loss)
Items that may not be reclassified to profit
or loss
Exchange differences on translation
of foreign operations (417) 368 367
Total comprehensive loss (2,247) (3,357) (14,858)
Six months Six months Year ended
to to
30 June 2022 30 June 31 Dec 2021
2021
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
- Owners of the parent company (2,545) (4,857) (17,432)
- Non-controlling interests 715 1,132 2,207
Total comprehensive loss is attributable
to:
- Owners of the parent company (2,962) (4,489) (17,065)
- Non-controlling interests 715 1,132 2,207
Loss per share:
- Basic loss per share 5 GBP (0.01) GBP (0.02) GBP (0.08)
- Diluted loss per share 5 GBP (0.00) GBP (0.02) GBP (0.08)
The notes on pages 10 - 26 form an integral part of the financial
statements.
30 Jun 30 Jun 31 Dec
2022 2021 2021
(unaudited) (unaudited) (audited)
Notes GBP'000 GBP'000 GBP'000
Non-current assets
Property, plant and equipment 6 916 915 941
Right-of-use assets 7 3,071 2,583 2,719
Goodwill and other intangible
assets 8 97,231 46,943 80,255
Investments - 20 -
Deferred tax asset - 392 -
101,218 50,853 83,915
Current assets
Short term investments 72 - 65
Trade and other receivables 7,207 5,067 5,749
Cash and cash equivalents 20,693 24,733 42,933
27,972 29,800 48,747
Total assets 129,190 80,653 132,662
Current liabilities
Trade and other payables 18,515 20,077 26,084
Deferred consideration payable 10 14,286 900 7,706
32,801 20,977 33,790
Non-current liabilities
Deferred consideration payable 10 10,304 3,810 14,482
Other non-current liabilities 2,956 9,834 2,915
Deferred tax liability 7,521 1,889 4,577
Total liabilities 53,582 36,510 55,764
Net assets 75,608 44,143 76,898
Equity
Share capital 11 10,846 10,846 10,846
Share premium 11 8,224 8,224 8,224
Preference share capital 12 70,150 37,550 70,150
Other reserves 11,597 (487) 11,041
Foreign exchange reserve 417 (459) (488)
Retained (loss) (27,638) (12,359) (23,800)
Equity attributable to the owners of
the Parent Company 73,596 43,315 75,973
Non-controlling interests 2,012 828 925
Total equity 75,608 44,143 76,898
The notes on pages 10 - 26 form an integral part of the financial
statements.
The financial statements of Kingswood Holdings Limited (registered
number 42316) were approved and authorised for issue by the Board
of Directors, and signed on its behalf by:
Chairman
Date:
KINGSWOOD HOLDINGS LIMITED
INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIODED 30 JUNE 2022
Share Deferred Preference Other Foreign Retained Equity Non-controlling Total
capital share share reserves exchange earnings attributable interests
and capital capital reserve to the
share owners
premium of the
parent
Company
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1
January 2021 19,070 - 37,550 (519) (855) (6,159) 49,087 1,065 50,152
Loss for the
period - - - - - 4,857 4,857 (1,132) 3,725
Amounts
attributable
to NCI - - - - - - - 32 (32)
Elimination of
local
goodwill
on
consolidation - - - - - (1,343) 1,343 (1,337) (2,680)
Foreign
exchange gain - - - - 368 - 368 - 368
Share based
remuneration - - - 60 - - 60 - 60
Balance at 30
June 2021
(unaudited) 19,070 - 37,550 (459) 487 (12,359) 43,315 828 44,143
(Loss) /
profit for
the period - - - - - (12,575) (12,575) 1,075 (11,500)
Dividends due
to NCI - - - - - - - (1,033) (1,033)
Other
adjustment - - - - - 1,134 1,134 - 1,134
Issue of
preference
share capital - - 32,600 - - 32,600 - 32,600
Share based
remuneration - - - 34 - - 34 - 34
Preference
share capital
reserve 11,466 11,466 - 11,466
Foreign
exchange loss - - - - (1) - (1) 55 54
Balance at 31
December 2021
(audited) 19,070 - 70,150 11,041 (488) (23,800) 75,973 925 76,898
Share Deferred Preference Other Foreign Retained Equity Non-controlling Total
capital share share reserves exchange earnings attributable interests
and capital capital reserve to the
share owners
premium of the
parent
Company
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
(Loss) /
profit for
the period - - - - - (2,545) (2,545) 715 (1,830)
Movement on
NCI - - - - - - - 372 372
Consolidation
adjustment - - - - - (1,293) (1,293) - (1,293)
Foreign
exchange
movement - - - - 905 - 905 - 905
Share based
remuneration - - - 556 - - 556 - 556
Foreign
exchange gain - - - - - - - - -
Balance at 30
June 2022
(unaudited) 19,070 - 70,150 11,597 417 (27,638) 73,596 2,012 75,608
Note 11 provides further details of, and the split between, Share Capital and Share
Premium.
Additional reserves consist of foreign exchange translation, other reserves including share-based
remuneration and expenses charged against reserves.
The notes on pages 10 - 26 form an integral part of the financial statements.
KINGSWOOD HOLDINGS LIMITED
INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIODED 30 JUNE 2022
Period Period Year ended
30 Jun 30 Jun 31 Dec
2022 2021 2021
(unaudited) (unaudited) (audited)
Notes GBP'000 GBP'000 GBP'000
Net cash generated from
/ (used in) operating activities 13 (8,989) 1,679 1,741
Investing activities
Property, plant and equipment
purchased (50) (529) (127)
Acquisition of investments (13,180) - (12,720)
Remuneration charge (deferred
consideration) (173) - (738)
Net cash used in investing
activities (13,403) (529) (13,585)
Financing activities
Proceeds from issue of
shares - 20,000 52,600
Interest paid (11) (12) (58)
Lease payments (454) (304) (650)
Dividends paid to non-controlling
interests - - (1,272)
New loans (repaid) / loans
received (156) - 18
Net cash (used in)/generated
from financing activities (621) 19,684 50,638
Net (decrease)/increase
in cash and cash equivalents (23,013) 20,834 38,794
Cash and cash equivalents at beginning
of Period 42,933 3,899 3,899
Effect of foreign
exchange rates 771 - 240
Cash and cash equivalents
at end of Period 20,691 24,733 42,933
Prior period financials have been restated to correctly recognise
contingent deferred consideration payments, linked to the continued
employment of the acquiree's employees, as an operating cash outflow
in the Consolidated Statement of Cash Flows. Previously all deferred
consideration payments related to acquisitions were included in the
deferred consideration line within net cash used in investing activities.
In 30 June 2021, the cash outflow reclassified from investing activities
to operating activities was GBP3,974,702.
The notes on pages 10 - 26 form an integral part of the financial
statements.
KINGSWOOD HOLDINGS LIMITED
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE PERIODED 30 JUNE 2022
1 Accounting policies
General information
Kingswood Holdings Limited is a company incorporated in Guernsey
under The Companies (Guernsey) Law, 2008. The shares of the Company
are traded on the AIM market of the London Stock Exchange (ticker
symbol: KWG). The nature of the Group's operations and its principal
activities are set out in the Strategic Report. Certain subsidiaries
in the Group are subject to the FCA's regulatory capital requirements
and therefore required to monitor their compliance with credit,
market and operational risk requirements, in addition to performing
their own assessment of capital requirements as part of the ICAAP.
1.1 Basis of accounting
The Group's interim condensed consolidated financial statements
are prepared and presented in accordance with IAS 34 'Interim
Financial Reporting'. The accounting policies adopted by the
Group in the preparation of its 2022 interim report are consistent
with those disclosed in the annual financial statements for the
year ended 31 December 2021.
The information relating to the six months ended 30 June 2022
and the six months ended 30 June 2021 do not constitute statutory
financial statements and has not been audited. The interim condensed
consolidated financial statements do not include all the information
and disclosures required in the annual financial statements and
should be read in conjunction with the Group's most recent annual
financial statements for the year ended 31 December 2021.
1.2 Changes in significant accounting policies
The Group has applied the same accounting policies and methods
of computation in its interim consolidated financial statements
as in its 2021 annual financial statements.
There are a number of standards and interpretations which have
been issued by the International Accounting Standards Board that
are effective for periods beginning subsequent to 31 December
2022 (the date on which the company's next annual financial statements
will be prepared up to) that the Group has decided not to adopt
early. The Group does not believe these standards and interpretations
will have a material impact on the financial statements once
adopted.
1.3 Significant accounting policies
Going concern
The Directors review the going concern position of the Group
on a regular basis as part of the monthly reporting process which
includes consolidated management accounts and cash flow projections
and have, at the time of approving the financial statements,
a reasonable expectation that the Group has adequate resources
to continue in operational existence for the foreseeable future.
Accordingly, the Directors continue to adopt the going concern
basis of accounting in preparing the financial statements.
Revenue recognition
Performance obligations and timing of revenue recognition
The majority of the Group's UK revenue, being investment management
fees and ongoing wealth advisory, is derived from the value of
funds under management / advice, with revenue recognised over
the period in which the related service is rendered. This method
reflects the ongoing portfolio servicing required to ensure the
Group's contractual obligations to its clients are met. This
also applies to the Group's US Registered Investment Advisor
("RIA") business.
For certain commission, fee-based and initial wealth advisory
income, revenue is recognised at the point the service is completed.
This applies in particular to the Group's US Independent Broker
Dealer ("IBD") services, and its execution-only UK investment
management. There is limited judgement needed in identifying
the point such a service has been provided, owing to the necessity
of evidencing, typically via third-party support, a discharge
of pre-agreed duties.
1 Accounting policies
The US division also has significant Investment Banking operations,
where commission is recognised on successful completion of the
underlying transaction.
Determining the transaction price
Most of the Group's UK revenue is charged as a percentage of
the total value of assets under management or advice. For revenue
earned on a commission basis, such as the US broker dealing business,
a set percentage of the trade value will be charged. In the case
of one-off or ad hoc engagements, a fixed fee may be agreed.
Allocating amounts to performance obligations
Owing to the way in which the Group earns its revenue, which
is largely either percentage-based or fixed for discrete services
rendered, there is no judgement required in determining the allocation
of amounts received. Where clients benefit from the provision
of both investment management and wealth advisory services, the
Group is able to separately determine the quantum of fees payable
for each business stream.
Further details on revenue, including disaggregation by operating
segment and the timing of transfer of service(s), are provided
in note 3 below.
2 Critical accounting judgements and key sources of estimation
uncertainty
In the application of the Group's accounting policies, which
are described in note 1, the Directors are required to make judgements,
estimates and assumptions about the carrying amounts of assets
and liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on historical
experience and other factors that are considered to be relevant.
Actual results may differ from these estimates.
Critical judgements in applying the Group's accounting policies
The following are the critical judgements that the Directors
have made in the process of applying the Group's accounting policies
that had the most significant effect on the amounts recognised
in the financial statements.
Assessment of control
Control is considered to exist where an investor has power over
an investee, or else is exposed, and has rights, to variable
returns. The Group determines control to exist where its own
direct and implicit voting rights relative to other investors
afford KHL - via its board and senior management - the practical
ability to direct, or as the case may be veto, the actions of
its investees. KHL holds 50.1% of voting rights in MHC and its
subsidiaries, as well as a majority stake in the US division's
advisory board when grouped with affiliated entities. The Group
has thus determined that the Company has the practical ability
to direct the relevant activities of MHC and its subsidiaries,
and has consolidated the sub-group as subsidiaries with a 49.9%
non-controlling interest.
Estimates and Assumptions
Intangible assets:
Expected duration of client relationships
The Group makes estimates as to the expected duration of client
relationships to determine the period over which related intangible
assets are amortised. The amortisation period is estimated with
reference to historical data on account closure rates and expectations
for the future. During the period, client relationships were
amortised over a 10-20 year period.
2 Critical accounting judgements and key sources of estimation
uncertainty
Goodwill
The amount of goodwill initially recognised as a result of a
business combination is dependent on the allocation of the purchase
price to the fair value of the identifiable assets acquired and
the liabilities assumed. The determination of the fair value
of the assets and liabilities is based, to a considerable extent,
on management's judgement. Goodwill is reviewed annually for
impairment by comparing the carrying amount of the CGUs to their
expected recoverable amount, estimated on a value-in-use basis.
Share-based remuneration:
Share based payments
The calculation of the fair value of share-based payments requires
assumptions to be made regarding market conditions and future
events. These assumptions are based on historic knowledge and
industry standards. Changes to the assumptions used would materially
impact the charge to the Statement of Comprehensive Income.
Deferred tax:
Recoverability of deferred tax assets
The amount of deferred tax assets recognised requires assumptions
to be made to the financial forecasts that probable sufficient
taxable profits will be available to allow all or part of the
asset to be recovered.
Leases:
Estimating the incremental borrowing rate
The Group cannot readily determine the interest rate implicit
in leases where it is the lessee, therefore, it uses its incremental
borrowing rate to measure lease liabilities. This is the rate
of interest that the Group would have to pay to borrow over a
similar term, and with a similar security, the funds necessary
to obtain an asset of a similar value to the right-of-use asset
in a similar economic environment.
The incremental borrowing rate therefore reflects what the Group
'would have to pay', which requires estimation when no observable
rates are available or when they need to be adjusted to reflect
the terms and conditions of the lease (for example, when leases
are not in the subsidiary's functional currency). The Group estimates
the incremental borrowing rate using observable inputs (such
as market interest rates) when available and is required to make
certain entity-specific estimates (such as the subsidiary's stand-alone
credit rating).
Deferred consideration:
Payment of deferred consideration
The Group structures acquisitions such that consideration is
split between initial cash or equity settlements and deferred
payments. The initial value of the contingent consideration is
determined by EBITDA and/or revenue targets agreed on the acquisition
of each asset. It is subsequently remeasured at its fair value
through the Statement of Comprehensive Income, based on the Directors'
best estimate of amounts payable at a future point in time, as
determined with reference to expected future performance. Forecasts
are used to assist in the assumed settlement amount.
3 Business and geographical segments
Information reported to the Group's Non-Executive Chairman for
the purposes of resource allocation and assessment of segment
performance is focused on the category of customer for each type
of activity.
The Group's reportable segments under IFRS 8 are as follows:
investment management, wealth planning and US operations.
The Group has disaggregated revenue into various categories in
the following table which is intended to depict how the nature,
amount, timing and uncertainty of revenue and cash flows are
affected by economic date and enable users to understand the
relationship with revenue segment information provided below.
The following is an analysis of the Group's revenue and results
by reportable segment for the year to 31 December 2021. The table
below details a full year's worth of revenue and results for
the principal business and geographical divisions, which has
then reconciled to the results included in the Statement of Comprehensive
Income:
Investment Wealth US operations Group Total
management planning
Perioded Ended 30
June 2022
Continuing operations: GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue (disaggregated by
timing):
Point in time 465 1,776 55,944 - 58,185
Over time 3,123 11,088 7,993 - 22,204
External sales 3,588 12,864 63,937 - 80,389
Direct expenses (717) (519) (59,094) - (60,330)
Gross profit 2,871 12,345 4,843 - 20,059
Operating profit
/ (loss) 685 5,125 1,529 (2,834) 4,505
Business re-positioning
costs (140) (336) (397) (329) (1,202)
Finance costs (1) (70) (3) (1,381) (1,455)
Amortisation and
depreciation - (687) 42 (1,218) (1,863)
Remuneration charge
(deferred consideration) - (42) - 6,351 6,309
Transaction costs - - - (1,621) (1,621)
Goodwill adjustment - - - (6,364) (6,364)
Profit / (loss)
before tax from continuing
operations 544 3,990 1,171 (7,396) (1,691)
Tax - (129) 11 (21) (139)
Profit / (loss)
after tax from continuing
operations 544 3,861 1,182 (7,417) (1,830)
3 Business and geographical segments
Perioded Ended 30 Investment Wealth US operations Group Total
June 2021 management planning
Continuing operations: GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue (disaggregated by
timing):
Point in time 513 953 48,162 - 49,628
Over time 1,799 7,354 2,760 - 11,913
External sales 2,312 8,307 50,922 - 61,541
Direct expenses (790) (460) (46,574) - (47,824)
Gross profit 1,522 7,847 4,348 - 13,717
Operating (loss)
/ profit 56 2,774 2,519 (2,294) 3,055
Business re-positioning
costs (76) (112) (184) (35) (407)
Finance costs - (50) 5 (795) (840)
Amortisation and
depreciation - (522) (15) (580) (1,117)
Remuneration charge
(deferred consideration) - (2,128) - (2,017) (4,145)
Transaction costs - (8) - (266) (274)
Profit / (loss)
before tax from continuing
operations (20) (46) 2,325 (5,987) (3,728)
Tax - - (40) 43 3
Profit / (loss)
after tax from continuing
operations (20) 46 2,285 (5,944) (3,725)
3 Business and geographical segments
Year Ended Investment Wealth US operations Group Total
31 December management planning
2021
(audited) 2021 2021 2021 2021 2021
Continuing operations: GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue (disaggregated by
timing):
Point in time 881 2,045 118,396 - 121,322
Over time 3,771 15,169 9,431 23 28,394
External sales 4,652 17,214 127,827 23 149,716
Direct expenses (1,476) (913) (118,108) - (120,497)
Gross profit 3,176 16,301 9,719 23 29,219
Operating (loss)
/ profit 365 5,779 5,123 (4,940) 6,327
Business re-positioning
costs (177) (239) (263) (885) (1,564)
Finance costs - (72) 2 (4,857) (4,927)
Amortisation and
depreciation - (1,197) (212) (990) (2,399)
Other gains - - - (3,056) (3,056)
Remuneration charge
(deferred consideration) - (3,691) - (3,318) (7,009)
Transaction costs - (4) - (1,832) (1,836)
(Loss) / profit
before tax from
continuing
operations 188 576 4,650 (19,878) (14,464)
Tax - (16) (317) (428) (761)
(Loss) / profit
after tax from continuing
operations 188 560 4,333 (20,306) (15,225)
4 Other (losses) / gains
Six months Six months Year Ended
to to
30 June 30 June 31 December
2022 2021 2021
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Additional payments due on acquired
businesses - - (2,983)
Unrealised gain/(loss) on stock - - (73)
- - (3,056)
5 Earnings per share
Six months Six months Year ended
to to
30 Jun 30 Jun 31 Dec 2021
2022 2021
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Loss from continuing operations
for the purposes of basic loss
per share, being net loss attributable
to owners of the Group (2,545) (4,857) (17,432)
Number of shares
Weighted average number of ordinary
shares for the purposes of basic
loss per share 216,920,719 216,920,719 216,920,724
Effect of dilutive potential ordinary
shares:
Share options 8,580,094 14,979,244 5,702,567
Convertible preference shares
in issue 469,263,291 271,687,533 271,986,413
Weighted average number of ordinary
shares for the purposes of diluted
loss per share 694,764,104 503,587,496 494,609,704
Continous operations:
Basic loss per share GBP(0.02) GBP(0.02) GBP(0.08)
Diluted loss per share GBP(0.01) GBP(0.02) GBP(0.04)
Total loss:
Basic loss per share GBP(0.02) GBP(0.02) GBP(0.08)
Diluted loss per share GBP(0.01) GBP(0.02) GBP(0.04)
6 Tangible Assets
Fixtures
and equipment
GBP'000
Cost
At 1 January 2021 1,380
Additions 79
At 30 June 2021 1,459
Additions 196
At 31 December 2021 1,655
Additions 147
At 30 June 2022 1,802
Accumulated depreciation
At 1 January 2021 453
Depreciation charged in the Period 91
At 30 June 2021 544
Depreciation charged in the Period 170
At 31 December 2021 714
Acquisitions during the year 42
Depreciation charged in the Period 130
At 30 June 2022 886
Net book value
At 30 June 2022 916
At 31 December 2021 941
At 30 June 2021 915
7 Right-of-use assets
Land and
buildings
GBP'000
Cost
At 1 January 2021 3,569
Prior year reclassification (35)
Additions 65
At 30 June 2021 3,599
Additions 490
At 31 December 2021 4,089
Movement due to FX 8
Additions 742
At 30 June 2022 4,831
Accumulated depreciation
At 1 January 2021 741
Prior year reclassification 35
Depreciation charged in the Period 310
At 30 June 2021 1,016
Depreciation charged in the Period 354
At 31 December 2021 1,370
Depreciation charged in the Period 398
At 30 June 2022 1,768
Net book value
At 30 June 2022 3,071
At 31 December 2021 2,719
At 30 June 2021 2,583
8 Goodwill and other intangible assets
Goodwill Other intangible Total
assets
GBP'000 GBP'000 GBP'000
Cost
At 1 January 2021 25,684 27,968 53,652
Additions 35 - 35
At 30 June 2021 - - 53,687
Additions - - -
At 30 June 2021 25,719 27,968 53,687
Additions 19,404 14,647 34,051
Movement due to FX 67 - 67
Disposals (40) - (40)
Impairment
At 31 December 2021 45,150 42,615 87,765
Additions 11,226 13,449 24,675
Movement due to FX - - -
Disposals - - -
Impairment (6,364) (6,364)
At 30 June 2022 50,012 56,064 106,076
Accumulated amortisation
At 1 January 2021 2,279 3,757 6,036
Amortisation charged for the Period - - -
Disposals
Charge for period - 708 708
At 30 June 2021 2,279 4,465 6,744
Disposals
Charge for period - 767 767
At 31 December 2021 2,279 5,232 7,511
Disposals
Charge for period 1,335 1,335
At 30 June 2022 2,279 6,567 8,846
8 Goodwill and other intangible assets (continued)
Net book value
As at 30 June 2022 47,733 49,498 97,231
As at 31 December 2021 42,871 37,384 80,255
As at 30 June 2021 23,440 23,503 46,943
For the half year ended 30 June 2022, the Group recorded a goodwill
adjustment charge of GBP6.4m in respect of the acquisition of
iBoss in 2021 linked to the reduction of the growth earn-out
liability (see note 10).
9 Lease liabilities
The lease liabilities are included in trade and other payables
and other non-current liabilities in the statement of financial
position.
Land and
buildings
GBP'000
At 1 January 2021 3,234
Additions 65
Interest expense 92
Lease payments (315)
At 30 June 2021 3,076
Additions 517
Interest expense 16
Lease payments (335)
At 31 December 2021 3,274
Additions 735
Interest expense 95
Lease payments (451)
At 30 June 2022 3,653
The Group recognises a right-of-use asset and a lease liability
at the lease commencement date. The right-of-use asset is initially
measured at cost, and subsequently at cost less any accumulated
depreciation and impairment losses and adjusted for certain
re-measurements of the lease liability.
9 Lease liabilities (continued)
The lease liability is initially measured at the present value
of the lease payments that are not paid at the commencement
date, discounted using the Group's incremental borrowing rate.
The lease liability is subsequently increased by the interest
cost on the lease liability and decreased by lease payment made.
The Group has applied judgement to determine the lease term
for some lease contracts in which it is a lessee that includes
renewal options. The assessment of whether the Group is reasonably
certain to exercise such options impacts the lease term, which
significantly affects the amount of lease liabilities and right-of-use
assets recognised.
10 Deferred consideration payable
Six Months Six Months Year Ended
to to
30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
Deferred consideration payable on acquisitions: 24,590 4,710 22,188
- falling due within one year 14,286 900 7,706
- due after more than one year 10,304 3,810 14,482
The deferred consideration payable on acquisitions is due to
be paid in cash.
The deferred consideration liability is contingent on performance
requirements during the deferred consideration period. The value
of the contingent consideration is determined by EBITDA and/or
revenue targets agreed on the acquisition of each asset, as defined
under the respective Share or Business Purchase Agreement. As
at the reporting date, the Group is expecting to pay the full
value of its deferred consideration as all acquisitions are on
target to meet the requirements.
Previously all deferred consideration payable on acquisitions
was recorded as a deferred liability and included in the fair
value of assets. However, in circumstances where the payment
of deferred consideration is contingent on the seller remaining
within the employment of the Group during the deferred period,
the contingent portion of deferred consideration is not included
in the fair value of consideration paid, rather is treated as
remuneration and accounted for as a charge against profits over
the deferred period.
During the year, deferred consideration as remuneration was a
credit through profit or loss of GBP6,309,121, mainly due to
a reduction in growth earn-out liabilities for the iBoss business
(2021: GBP7,008,600 expense).
11 Share capital
Six months Six months Year ended Six months Six months Year ended
to to to to
30 June 30 June 31 Dec 30 June 30 June 31 Dec
2022 2021 2021 2022 2021 2021
(unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited)
Shares Shares Shares GBP'000 GBP'000 GBP'000
Ordinary
shares
issued:
Fully paid 216,920,719 216,920,719 216,920,719 10,846 10,846 10,846
216,920,719 216,920,719 216,920,719 10,846 10,846 10,846
Share capital and share premium
Number Par value Share Total
of ordinary premium
shares
'000 GBP'000 GBP'000 GBP'000
At 1 January 2020 216,921 10,846 8,224 19,070
Issued during year - - - -
As at 30 June 2021 216,921 10,846 8,224 19,070
At 31 December 2021 216,921 10,846 8,224 19,070
Issued during year - - - -
At 30 June 2022 216,921 10,846 8,224 19,070
Ordinary shares have a par value of GBP0.05 per share. They entitle
the holder to participate in dividends, and to share in the proceeds
of winding up the company in proportion to the number of, and
amounts paid on, shares held. On a show of hands, every holder
of ordinary shares present at a meeting in person or by proxy,
is entitled to one vote and upon a poll each share is entitled
to one vote.
Kingswood Holdings Limited does not have a limit on the amount
of authorised capital.
As at 31 December 2021, KPI (Nominees) Limited held 143,720,906
Ordinary Shares, representing 66.3 per cent of ordinary shares
in issue at year end.
12 Preference share capital
Six Months Six Months Year Ended Six Months Six Months Year Ended
to to to to
30 June 30 June 31 Dec 2021 30 June 30 June 31 Dec
2022 2021 2022 2021 2021
(unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited)
Shares Shares Shares GBP'000 GBP'000 GBP'000
Convertible preference shares
issued:
Fully paid 77,428,443 44,828,443 77,428,443 77,428 44,828 77,428
77,428,443 44,828,443 77,428,443 77,428 44,828 77,428
Preference share capital movements are
as follows:
Number Par value
of shares
'000 GBP'000
At 1 January 2021 5,728 5,728
Issued during year 39,100 39,100
At 30 June 2021 44,828 44,828
Issued during year 32,600 32,600
At 31 December 2021 77,428 77,428
Issued during year - -
At 30 June 2022 77,428 77,428
Six Months Six Months Year Ended
to to
30 June 30 June 31 Dec
2022 2021 2021
(unaudited) (unaudited) (audited)
Equity component 70,150 37,550 70,150
Liability component - 7,469 -
70,150 45,019 70,150
12 Preference share capital (continued)
On 12 September 2019, Kingswood Holdings Limited entered into
a subscription agreement with HSQ INVESTMENT LIMITED, a wholly
owned indirect subsidiary of funds managed and/or advised by Pollen
Street, to subscribe for up to 80 million irredeemable convertible
preference shares, at a subscription price of GBP1 each (the Subscription).
Pollen Street is a global, independent alternative asset investment
management company, established in 2013 with currently GBP3.2
billion gross AUM across private equity and credit strategies,
focused on the financial and business services sectors, with significant
experience in speciality finance.
All irredeemable convertible preference shares convert into new
ordinary shares at Pollen Street Capital's option at any time
from the earlier of an early conversion trigger or a fundraising,
or automatically on 31 December 2023. Preferential dividends on
the irredeemable convertible preference shares accrue daily at
a fixed rate of five per cent per annum from the date of issue.
Effective 17 December 2021 onwards, these will be settled via
the issue of additional ordinary shares, thereby extinguishing
the liability component.
13 Notes to the cash flow statement
Cash and cash equivalents comprise cash and cash equivalents
with an original maturity of three months or less. The carrying
amount of these assets is approximately equal to their fair value.
Six Months Six Months Year Ended
to to
30 June 30 June 31 Dec 2021
2022 2021
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Loss before tax (1,691) (3,728) (14,464)
Depreciation and amortisation 1,863 1,117 2,399
Goodwill adjustment 6,364 - -
Finance costs 1,455 840 4,927
Remuneration charge (deferred consideration) (7,399) 170 234
Share-based payment expense 556 60 94
Other losses / (gains) - - 1,281
Foreign exchange gain 12 4 (6)
Tax paid (139) (40) (318)
Operating cash flows before movements
in working capital 1,021 (1,577) (5,853)
(Increase)/decrease in receivables 786 (863) (449)
Increase/(decrease) in payables (10,796) 4,119 8,043
Net cash inflow / (outflow) from operating
activities (8,989) 1,679 1,741
14 Financial instruments
The following table states the classification of financial instruments
and is reconciled to the Statement of Financial Position:
30 Jun 30 Jun 31 Dec
2022 2021 2021
Carrying Carrying Carrying
amount amount amount
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Financial assets measured at amortised
cost
Trade and other receivables 5,846 3,790 4,308
Cash and cash equivalents 20,693 24,733 42,933
Financial liabilities measured at
amortised cost
Trade and other payables (16,530) (17,495) (23,826)
Other non-current liabilities (222) - (318)
Lease liability (3,653) (3,076) (3,274)
Preference share liability - (7,469) -
Financial liabilities measured at
fair value through profit and loss
Deferred consideration payable (24,590) (4,710) (22,188)
(18,456) (4,227) (2,365)
Financial instruments not measured at fair value includes cash
and cash equivalents, trade and other receivables, trade and
other payables, and other non-current liabilities.
Due to their short-term nature, the carrying value of cash and
cash equivalents, trade and other receivables, and trade and
other payables approximates fair value.
Item Fair value Valuation technique Fair value
hierarchy
level
GBP'000
Deferred 24,590 Fair value of Level 3
consideration deferred
payable consideration
payable
is estimated by
discounting the
future cash flows
using the IRR
inherent
in the company's
acquisition price.
15 Related party transactions
Remuneration of key management personnel
The remuneration of the Directors, who are the key management
personnel of the Group, is set out below in aggregate for each
of the categories specified in IAS 24 Related Party Disclosures.
Six months Six months Year ended
to to
30 June 30 June 31 Dec
2022 2021 2021
(unaudited) (unaudited) (audited)
2022 2021 2021
GBP'000 GBP'000 GBP'000
Short-term employee benefits 103 371 340
Termination benefits - - -
Share based payments - 34 -
103 405 340
Other related parties
During the period, KHL incurred fees of GBP58,333 (30 June 2021:
GBP62,500; 31 December 2021: GBP137,500) from KPI (Nominees)
Limited in relation to Non-Executive Director remuneration. At
30 June 2022, GBPnil of these fees remained unpaid (30 June 2021:
GBP37.500; 31 December 2021: GBPnil).
Fees received from Moor Park Capital Partners LLP, in which Gary
Wilder holds a beneficial interest, relating to property related
services provided by KHL totalled GBP23,708 for the period ended
30 June 2022 (30 June 2021: GBP23,708; 31 December 2021: GBP23,090),
of which GBPnil (30 June 2021: GBPnil; 31 December 2021: GBPnil)
was outstanding at 30 June 2021.
Fees paid for financial and due diligence services to Kingswood
LLP and Kingswood Corporate Finance Limited, in which Gary Wilder
and Jonathan Massing hold a beneficial interest, totalled GBP420,807
for the period to 30 June 2022 (30 June 2021: GBP201,829; 31
December 2021: GBP384,750), of which GBPnil (30 June 2021: GBP5,430;
31 December 2021: GBPnil) was outstanding at 30 June 2022.
16 Ultimate controlling party
As at the date of approving the financial statements, the ultimate
controlling party of the Group was KPI (Nominees) Limited.
17 Events after the reporting date
Acquisition of Smith Pearman & Associates
On 29th July 2022, Kingswood completed the acquisition of Smith
Pearman & Associates, an independent financial advice company
based in Hampshire. Established for over 35 years, Smith Pearman
& Associates look after over 240 clients with over GBP70m AUA
in the Hampshire region. They offer tailored services to high
net-worth individuals with an existing portfolio, or new investment
requirements, based on personal goals and aspirations.
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END
IR FLFETAFISLIF
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