TIDMLCG
RNS Number : 3602L
London Capital Group Holdings PLC
30 September 2016
LONDON CAPITAL GROUP HOLDINGS PLC
("LCG", the "Company" or the "Group")
INTERIM RESULTS FOR THE 6 MONTHSED 30 JUNE 2016
LCG is pleased to announce its interim results for the six
months ended 30 June 2016.
Financial Highlights Unaudited Unaudited
6 Months 6 Months
30 June 2016 30 June 2015
GBP'000 GBP'000
Revenue 11,218 5,320
Gross Profit 9,241 3,032
Adjusted EBITDA(3) (2,148) (7,452)
Adjusted (loss)/profit before tax(2) (3,418) (8,556)
Statutory (loss) before tax (3,493) (8,592)
Basic loss per share from continuing operations (5.26p) (14.26p)
Diluted loss per share from continuing operations (5.26p) (14.26p)
Dividend per share 0.0p 0.0p
Commenting on the results, Charles-Henri Sabet, Chief Executive,
said:
"Despite the tough trading conditions seen at the tail end of
Q1-16 and through Q2-16 prior to the Brexit vote, the Group has
seen strong revenue growth primarily due to increased revenue
capture compared to prior periods. The integration of new
technology coupled with a resilient and loyal client base continues
to see LCG grow despite the continued lack of volatility in the
market resulting in a benign trading environment. LCG's ability to
capture and take advantage of trading opportunities means the Group
is now better placed to be resilient during periods where trading
conditions are weak".
Operational Highlights
- Growth in total monthly active clients - increased 2% to 4,141 (H1 2015: 4,060)
This despite challenging trading conditions in Q2-16 prior to
Brexit.
- Growth in monthly open & funded accounts - monthly average
increased 15% to 325 (H1 2015: 283).
This demonstrates the increasing effectiveness of the new brand,
platform and marketing activities.
Post Period End Events
-- Issue of new equity and redemption of CLN on 6 July 2016.
-- Around GBP8.3m of debt redeemed and replaced with equity.
-- 286,207,779 new shares issued
-- Re-affirms the commitment of GLIO to the business.
(1) Adjusted (loss)/profit before tax represents (loss)/profit
before tax excluding share based payment expense, impairment
charges to goodwill and investments, non-recurring restructuring
costs, costs related to change in IT platform, the movement in the
provision for FOS claims and non-recurring legal fees. Applied
consistently hereafter.
(2) Net cash and short term receivables represents Cash and cash
equivalents, less unsegregated amounts due to clients, plus amounts
due from brokers.
(3) Adjusted EBITDA represents (loss)/profit before interest,
tax, depreciation, amortisation, share based payment expense,
impairment charges to goodwill and investments, non-recurring
restructuring costs, costs related to change in IT platform and the
movement in the provision for FOS claims.
For further information, please contact:
London Capital Group Holdings
plc
Simon Hooks +44 (0)20 7456 7000
Allenby Capital Limited
Nominated Adviser and
Broker
John Depasquale
Nick Naylor +44 (0)20 3328 5656
About London Capital Group
(http://ir.londoncapitalgroup.com/)
London Capital Group Holdings plc (hereafter "LCGH plc" or "LCG"
or "London Capital Group" or "the Group") is a financial services
company offering online trading services.
London Capital Group Limited ("LCG Ltd"), a wholly-owned trading
subsidiary of LCGH plc, is authorised and regulated by the
Financial Conduct Authority. Its core activity is the provision of
spread betting and CFD products on the financial markets to retail
clients under the trading names Capital Spreads, Capital CFDs and
LCG MT. Its other division provides online foreign exchange trading
services. LCG Ltd has a European passport and is a member of the
London Stock Exchange. LCG Ltd also has access to international
markets through its global clearing relationships.
LCGH plc is quoted on the London Stock Exchange's AIM market.
LCG is included in the General Financial sector (8770) and
Speciality Finance sub sector (8775) and has a RIC code of
LCG.L.
CHAIRMAN'S STATEMENT
For the period ended 30 June 2016
H1 performance
For the 6 months ended 30 June 2016, notwithstanding January and
February, trading conditions overall have been heavily affected by
lower market volatility due primarily to the uncertainty in the
lead up to the EU referendum vote in the UK. This uncertainty had
the effect of deterring market participation both for existing and
new clients.
However, despite such challenging conditions, the Group, through
its continued investment in innovation, IT, sales and marketing and
the quality of people as well as an enhanced analytical approach to
trading and risk, were able to capture revenues far more
efficiently than in prior periods. This approach has ensured that
the Group is able to capitalise on significant trading
opportunities as they present themselves whilst at the same time
preserving the value of the franchise through diligent risk
management techniques.
We are confident the Group is now far better placed to derive a
steady revenue stream during weak trading conditions and be in a
position to take full advantage when conditions are favourable.
Organisational restructuring
As we have previously reported, the business had gone through a
phase of consolidation in 2015 as management has been focused on
getting the building blocks in place within the business (in terms
of technology, product offering, trading platforms, brand, customer
service and, most importantly, people) in order to position LCG for
a return to profitability. This effort has continued through the
first half of 2016 with LCG now positioned to take advantage of
growth opportunities. Cost savings associated with the
restructuring exercise in H1-16 are expected to materialise in the
second half of the year.
Outlook
LCG continues to invest in and to develop our people, products
and services, to provide our clients with the service they expect
in order to ensure that LCG is their provider of choice for their
trading needs. Part of that investment and growth has resulted in
the Group further developing its product offering by improving its
Meta Trader 4 platform, which the Board expects will create a
greater appeal to markets outside of the Group's traditional UK
market place.
The Group looks forward to benefiting from a refreshed marketing
campaign that will be launched, that in addition to the enhanced
product offering, the Board believes will give us the opportunity
to promote the brand, develop broader and more innovative products
and service offerings, and attract a more diversified client base,
both within the UK market and internationally.
In addition, the balance sheet of the Group has been
strengthened by the redemption of the outstanding Convertible Loan
Notes (CLN) and the issue of new equity capital. This has enhanced
the capital position of the Group while at the same time removing
debt.
I, the other Board members and the senior management team remain
confident about the prospects for the business in the coming
periods and are fully committed to ensuring that LCG continues on
the path to sustained long-term growth.
Charles Poncet
Non-Executive Chairman
30 September 2016
CHIEF EXECUTIVE OFFICER'S STATEMENT
For the period ended 30 June 2016
Financial Results
The Company experienced a positive start to the trading year
which coincided with a period of high volatility and market
movements in January and February of 2016 in reaction to various
market conditions. January and February saw volatility at their
highest levels for 6 months, with the CVIX (Chicago Board Options
Exchange Market Volatility Index, which is a measure of the implied
volatility of the S&P 500) gauging at historically high levels.
This resulted in positive trading conditions as markets across the
majority of asset classes traded outside of their ranges. The
increased volatility encouraged participation by clients with newly
funded accounts up 12% in the first three months of 2016 compared
with the same period in 2015.
The Group was able to take advantage of the favourable trading
conditions coupled with an enhanced analytical view of the Group's
client trading activity and behaviour to ensure maximum revenue
capture where opportunities allowed. As a result, revenues in the
first 3 months were 105% higher than the same period in 2015.
From March 2016 and continuing into the second quarter of the
year, saw a decrease in volatility to financial markets as a result
of the increased uncertainty over the EU referendum vote as market
participants chose to refrain from any short term position taking,
resulting in a reduction in activity across all asset classes. As a
result of the decrease in volatility and range bound market
conditions, client trading volumes decreased 28% during the second
quarter of 2016 versus the first quarter and 50% lower compared
with the same period in 2015.
Despite the down-turn in volatility - the Group was still able
to capture revenue at a greater rate than compared to the previous
year due to its analytical risk management policy. Revenues for the
second quarter were 98% higher than the same period in 2015 and
this shows that the investment by the Group in both the brand and
trading platform as well as the implementation of the enhanced risk
management analysis of client trading behaviour and patterns is
starting to repay its investment.
Overall, the first half of 2016 has seen revenues increase 111%
from the same period in the prior year and the Group has seen
monthly average open and funded accounts up 15% on the previous
year and, although total client funds decreased 11% over the same
period, it is anticipated that as the brand continues to gain
traction through marketing activities, this will begin to have a
positive impact.
Costs of sales for the period are GBP1.9m (2015 H1: GBP2.3m) and
gross profit is GBP9.2m which represents an 82% gross profit margin
on revenues (2015 H1: GBP3.0m gross profit and 57% gross profit
margin). This increase in gross profit margin is the result of the
increase in revenue capture the firm has seen since the
introduction of the enhanced risk management analysis of client
behaviour without any incremental increase in cost of sales.
EBITDA for the 6 month period is a loss of GBP2.1m (2015 H1:
loss of GBP7.5m) and is an approx. 71% improvement on the same
period last year. Administrative costs remain on the higher side at
GBP12.4m for the period (2015 H1: GBP9.9m) but the Group expects to
see the benefits of its cost reduction initiatives in the second
half of the year.
The loss before tax was GBP3.5m (2015 H1: loss of GBP8.6m) and
demonstrates the improvements the Group have made to ensure that
despite poor trading conditions seen in Q2-2016, there is a clear
path of improvement and move toward sustainable long term
profitability, through its improved branding, technology and
investment in people.
The net cash and short term receivables, decreased 38% to
GBP14.0m (2015 H1: GBP22.9m) primarily as a result of the losses
for the second half of 2015 (2015 Full year loss: GBP14.9m).
Available liquidity which comprises own cash held, title transfer
funds, unsegregated funds and amounts due from brokers decreased by
GBP1.7m from 31 December 2015.
Available liquidity and cash flow
Unaudited Unaudited Audited
30 June 30 June 31 December
2016 2015 2015
GBP'000 GBP'000 GBP'000
Own cash held 3,349 13,180 12,459
Short term receivables:
Amounts due from brokers 10,680 9,697 4,327
---------- ---------- -------------
Net cash and short term
receivables 14,029 22,877 16,786
---------- ---------- -------------
Title transfer funds
and unsegregated funds 1,029 - -
---------- ---------- -------------
Available liquid resources 15,058 22,877 16,786
---------- ---------- -------------
The results for the period and the financial position at 30(th)
June 2016 were considered satisfactory by the directors and they
are confident of improved results in the ensuing year with client
acquisition remaining strong, with the third quarter showing open
and funded accounts remaining at levels seen in both the first two
quarters of 2016.
Subsequent Events
The balance sheet of the Group has been enhanced by the
redemption of the Convertible Loan Notes (CLN) by the majority
shareholders (GLIO Holdings Limited) and issue of new ordinary
share capital on 6(th) July 2016. This has enhanced the capital
position of the Group while at the same time removing debt. The
removal of debt from the balance sheet and the resultant increase
in capital will improve LCG's capacity to expand into new markets
and geographies and will provide the Group with greater
opportunities to increase revenue. This is also a further sign of
GLIO's commitment and support to the Group and its belief in the
objectives of the firm.
Strategy
Customer trading volumes are driven by eight main factors. Four
of these factors are broad external factors outside the Company's
control and include:
-- changes in the financial strength of market participants;
-- economic and political conditions;
-- changes in the supply, demand and volume of foreign currency
transactions; and
-- regulatory changes.
Many of the above factors impact the volatility of financial
markets, which has generally been positively correlated with client
trading volume. The Company's customer trading volume is also
affected by the following additional factors:
-- the effectiveness of sales activities;
-- the competitiveness of the Company's offerings;
-- the effectiveness of the customer service team; and
-- the effectiveness of the marketing activities.
In order to increase customer trading volume, the Company will
continue to focus its marketing and its customer service and
education activities on attracting new customers and increasing
overall customer trading activity.
Historically, the Company and the Group business models have
been predominantly driven by retail client transactions focusing on
the UK market with client trading focused on its spread betting and
CFD offering. The Group is now looking to expand its offering
beyond the UK and enhance its technology and product offering by
developing its existing Meta Trader 4 platform to ensure it is both
market leading as well as being fit for purpose for the active
trader. The Group has enlisted the services of a team of experts
with a number of years of experience in both the target markets and
the technology being offered, to ensure that the release is both
suitable and scalable for the expected increase in client activity.
The team will operate from Cyprus and will take advantage of the
local resources and talent pool to ensure the offering has the
highest standard of technological requirements for the target
market. The launch date is expected to be in Q4-2016.
At the same time, the Group will also take advantage of these
resources and talent pool by off-shoring many of its processing and
operational functions to Cyprus which will additionally have a cost
saving benefit to the Group. The timing of these benefits is
expected to be seen in the latter part of Q4-16.
The Group looks forward to benefiting from the enhanced product
offerings which will give us the opportunity to promote the brand,
develop broader and more innovative products and service offerings,
and is hoped will attract a more diversified client base, both
within the UK market and internationally.
The Group's future success continues to be based on providing a
high quality service to our customers and offering a variety of
financial trading products and platforms. We will deliver a
complete multi-asset experience for our clients.
Our increased investment in technology will allow us to offer an
intelligent new platform while still delivering industry leading
spreads with instant, reliable execution. In addition, our analysts
will offer high quality analysis, research and financial news.
The Group's medium-term strategy will also continue to focus on
the promotion and further development of our key selling points
upon the completion of the Group's near-term objectives of:
- Industry-leading platforms
- Service
- Professional tools and news service
- Educational material
- Pricing
- Marketing
- Dealing execution
Our marketing is being aimed at attracting active retail
traders. This combined with improving the customer journey and
technology will ensure that the Group continues to be in a strong
strategic position.
Outlook
With the new initiatives being employed by the Group to expand
its already robust product offering through its enhanced and client
focused technology, whilst building on the LCG brand and expanding
into new markets and territories, the Board is confident the
business can continue to build on what has been a confident first
half performance. The removal of debt from the balance sheet and
the resultant increase in capital will improve LCG's capacity to
expand into new markets and geographies and I, the other Board
members and senior management team remain excited about the
prospects for the business in the coming periods and are fully
committed to ensuring that LCG continues on the path to sustained
long-term growth.
Charles-Henri Sabet
Chief Executive
30 September 2016
CONDENSED CONSOLIDATED INCOME STATEMENT
For the period ended 30 June 2016
Unaudited Unaudited Audited
6 Months 6 Months Year
to 30 to 30 to 31
June June December
2016 2015 2015
GBP'000 GBP'000 GBP'000
Revenue 11,218 5,320 15,489
Cost of sales (1,977) (2,288) (4,972)
----------- ---------- -------------
Gross profit 9,241 3,032 10,517
Other operating income - - 165
Administrative expenses
(before certain items)
Certain items: (12,330) (11,192) (24,149)
Credit / (Charge) for provision
against FOS claims - 489 (38)
Impairment of leasehold
assets - - (1,321)
Restructuring credit - 900 900
Share-based payment (charge) (75) (123) (142)
-------------------------------------- ----------- ---------- -------------
Total administrative expenses (12,405) (9,926) (24,750)
Other operating expenses - (8)
----------- ---------- -------------
Operating (loss) (3,164) (6,894) (14,076)
Investment revenue 20 58 257
Finance costs (350) (1,756) (684)
(Loss) before taxation (3,493) (8,592) (14,503)
Tax credit / (charge) - 1,303 (433)
----------- ---------- -------------
(Loss) for the period (3,493) (7,289) (14,936)
----------- ---------- -------------
Earnings per share (pence)
Pence Pence Pence
Basic (5.26) (14.26) (24.32)
Diluted (5.26) (14.26) (24.32)
Adjusted basic (5.17) (16.20) (23.11)
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the period ended 30 June 2016
Unaudited Unaudited Audited
6 Months 6 Months Year
to 30 to 30 to
June June 31 December
2016 2015 2015
GBP'000 GBP'000 GBP'000
(Loss) for the period (3,493) (7,289) (14,936)
---------- ---------- -------------
Total comprehensive (loss)
for the period (3,493) (7,289) (14,936)
---------- ---------- -------------
Total comprehensive (loss)
for the period attributable
to the owner of the parent (3,493) (7,289) (14,936)
========== ========== =============
CONDENSED CONSOLIDATED BALANCE SHEET
As at 30 June 2016
Unaudited Unaudited Audited
30 June 30 June 31 December
2016 2015 2015
Notes GBP'000 GBP'000 GBP'000
NON-CURRENT ASSETS
Intangible assets 3,716 1,281 2,903
Property, plant and
equipment 2,175 2,448 2,382
Deferred tax assets - 1,736 -
5,891 5,465 5,285
---------- ---------- -------------
CURRENT ASSETS
Financial investments
- held for trading 8,243 670
Trade and other receivables 6,114 13,656 6,456
Current tax receivables - - -
Cash and cash equivalents 4,378 13,180 12,459
18,735 26,836 19,585
---------- ---------- -------------
TOTAL ASSETS 24,626 32,301 24,853
---------- ---------- -------------
CURRENT LIABILITIES
Trade and other payables 6,505 4,522 3,680
Provisions 902 379 990
Obligations under finance
leases 82 28 93
Derivative financial
instruments 135 135
TOTAL CURRENT LIABILITIES 7,624 4,929 4,878
---------- ---------- -------------
NET CURRENT ASSETS 11,111 21,907 14,687
---------- ---------- -------------
NON-CURRENT LIABILITIES
Convertible loan notes 8,527 10,905 8,265
Obligations under finance
leases 149 98 149
Deferred consideration 230 230
8,906 11,003 8,644
TOTAL LIABILITIES 16,530 15,932 13,542
NET ASSETS 8,097 16,369 11,328
========== ========== =============
EQUITY
Share capital 7,985 7,559 7,985
Share premium 23,819 23,565 23,819
Own shares held (6,065) (6,065) (6,065)
Equity reserve 3,967 2,004 3,967
Retained earnings (16,138) (5,350) (12,907)
Other reserves (5,471) (5,344) (5,471)
TOTAL EQUITY 8,097 16,369 11,328
========== ========== =============
CONDENSED CONSOLIDATED CHANGES IN EQUITY
For the period ended 30 June 2016
Share Share Own shares Equity Retained Other Total equity
capital premium held reserve earnings reserves
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January
2015 5,580 20,592 (6,065) 6,809 1,887 (5,344) 23,459
Issue of share
capital 1,979 2,973 - - - - 4,952
Total
comprehensive
loss for the
period - - - - (7,289) - (7,289)
Share based
payment
transactions - - - - 123 - 123
At 30 June
2015 7,559 23,565 (6,065) 6,809 (5,279) (5,344) 21,245
Issue of share
capital 426 254 - - - - 680
Total
comprehensive
loss for the
period - - - - (7,647) - (7,647)
Share based
payment
transactions - - - - 19 - 19
Equity
component of
convertible
loan notes - - - (2,842) - - (2,842)
Issue of put
option over
shares - - - - - (127) (127)
At 1 January
2016 7,985 23,819 (6,065) 3,967 (12,907) (5,471) 11,328
Revaluation of
opening
equity on
Surecom - - - - - 188 188
Total
comprehensive
loss for the
period - - - - (3,494) - (3,494)
Share based
payment
transactions - - - - 75 - 75
At 30 June
2016 7,985 23,819 (6,065) 3,967 (16,326) (5,283) 8,097
============= ============= ============ ============= ============ ============= =============
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
For the period ended 30 June 2016
Unaudited Unaudited Audited
6 Months 6 Months Year
to 30 to 30 to 31
June June December
2016 2015 2015
GBP'000 GBP'000 GBP'000
Loss for the financial period (3,493) (7,289) (14,936)
Adjustments for:
Depreciation of property,
plant and equipment 285 262 584
Amortisation of intangible
assets 656 323 718
Share-based payments 75 123 142
Impairment of leasehold
improvements - - 1,321
Provisions (88) (1,389) (836)
Gain on disposal of property,
plant and equipment - 39 39
Investment income (20) (58) (257)
Finance costs 537 1,756 684
Current tax charge - - (2)
Movement in deferred tax
asset - (1,303) 435
Operating cash flows before
movements in working capital (2,048) (7,536) (12,108)
(Increase)/decrease in receivables (7,231) (4,875) 1,849
Increase/(decrease) in payables 3,077 (543) (640)
Cash (used in) operating
activities (6,202) (12,954) (10,899)
Taxation received/(paid) - 193 164
Net cash (used in) operations (6,202) (12,761) (10,735)
---------- ---------- ----------
Investing activities
Investment income 20 58 257
Finance costs - (6) -
Proceeds on disposal of
property, plant and equipment - 90 90
Acquisitions of property,
plant and equipment (86) (534) (1,200)
Acquisition of leasehold
assets 9 (940)
Acquisitions of intangible
assets (1,469) (460) (1,679)
Acquisitions of trademarks - (116)
Acquisitions of investment
in subsidiary - - -
Net cash used in investing
activities (1,526) (852) (3,588)
---------- ---------- ----------
Financing activities
Net proceeds in issue of
convertible loan note - - -
Finance costs (353) (11)
Cash used in the repurchase - - -
of shares
---------- ---------- ----------
Net cash provided by financing
activities (353) - (11)
---------- ---------- ----------
Net (decrease)/increase
in cash and cash equivalents (8,081) (13,613) (14,334)
Cash and cash equivalents
at beginning of period 12,459 26,793 26,793
Cash and cash equivalents
at end of period 4,378 13,180 12,459
========== ========== ==========
NOTES TO THE FINANCIAL STATEMENTS
For the period ended 30 June 2016
1. Basis of preparation
The interim condensed consolidated financial statements for the
six months ended 30 June 2016 have been prepared using accounting
policies consistent with International Financial Reporting
Standards as adopted by the EU (IFRS) and in accordance with IAS 34
Interim Financial Reporting.
The same accounting policies, presentation and methods of
computation are followed in the condensed set of financial
statements as applied in the Group's latest audited financial
statements.
The directors are satisfied that the Group has sufficient
resources to continue in operation for the foreseeable future, a
period of not less than 12 months from the date of this report.
Accordingly, they continue to adopt the going concern basis for
preparing the financial statements.
2. Adjusted (loss)/profit before tax, adjusted operating
(loss)/profit and adjusted EBITDA from continuing operations
Unaudited Unaudited Audited Year to 31 December 2015
6 Months to 30 June 6 Months to 30 June
2016 2015 GBP'000
GBP'000 GBP'000
Reported (loss) before tax from
continuing operations (3,493) (8,592) (14,503)
Add back - (credit)for provision
against FOS claims - (489) 38
Add back - (credit)/charge for
restructuring costs - (900) (900)
Add back - impairment of leasehold
assets - - 1,321
Add back - (credit)/charge for
share-based payment charge 75 123 142
Adjusted (loss)/profit before tax
from continuing operations (3,418) (9,858) (13,902)
Tax as reported - 1,303 (433)
Tax effect of add backs (15) 272 144
--------------------- --------------------- ---------------------------------
Adjusted (loss)/profit after tax
from continuing operations (3,433) (8,283) (14,191)
===================== ===================== =================================
Reported operating (loss) before tax
from continuing operations (3,164) (6,894) (14,076)
Add back - (credit)/charge for
share-based payment charge 75 123 142
--------------------- --------------------- ---------------------------------
Adjusted operating (loss) before tax
from continuing operations (3,089) (6,771) (13,934)
Add back - amortisation and
depreciation from continuing
operations 941 585 1,302
Add back - (credit)/charge for
provision against FOS claims - (489) 38
Add back - (credit)/charge for
restructuring costs - (900) (900)
Add back - impairment of leasehold
assets - - 1,321
Adjusted EBITDA from continuing
operations (2,148) (7,575) (12,173)
===================== ===================== =================================
3. Earnings per ordinary share
Basic earnings per share is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average
number of ordinary shares in issue during the period, after
deducting any own shares held. Fully diluted earnings per share is
calculated by dividing the earnings attributable to ordinary
shareholders by the total of the weighted average number of shares
in issue during the period and the dilutive potential ordinary
shares relating to share options and the convertible loan
notes.
From continuing operations
The calculation of the basic and diluted earnings per share is
based on the following data:
Unaudited Unaudited Audited
6 Months 6 Months Year to
to 30 June to 30 31 December
June
2016 2015 2015
Basic EPS
(Loss) after tax (GBP'000) (3,493) (7,289) (14,936)
Weighted average number
of shares 61,412,303 51,119,804 61,412,303
Weighted average basic
EPS (pence) (5.69) (14.26) (24.32)
Diluted EPS
(Loss) after tax (GBP'000) (3,493) (7,289) (14,936)
Weighted average number
of shares 61,412,303 125,248,630 61,412,303
Weighted average fully
diluted EPS (pence) (5.69) (14.26) (24.32)
Adjusted basic EPS
Adjusted (loss)/profit
after tax (see note 4)
(GBP'000) (3,433) (8,283) (14,191)
Weighted average number
of shares 61,412,303 51,119,804 61,412,303
Weighted average basic
EPS (pence) (5.59) (16.20) (23.11)
The diluted EPS excludes 74,128,826 in shares as this decreases
the loss per share and thus these are anti-dilutive.
4. Dividends
No dividends were declared or paid in the period (H1'15:nil)
5. Provisions and contingent liabilities
Unaudited 30 June 2016 Unaudited 30 June 2015 Audited 31 December 2015
GBP'000 GBP'000 GBP'000
Provision against FOS claims 486 - 486
Market data provision 315 379 403
Dilapidation provision 101 - 101
902 - 990
----------------------- ----------------------- -------------------------
Provision & contingent liability against FOS claims
Provision against FOS claims Contingency against FOS claims
GBP'000 GBP'000
At 1 January 2016 486 -
Utilisation - -
Release - -
Recognised during the period - -
At 30 June 2016 486 -
----------------------------- -------------------------------
In the second half of 2015, the Group received a complaint from
a client seeking to recover losses that arose in 2013 from an
agreement that they had entered into with an investment manager who
executed trades with the Group.
This complaint was ultimately forwarded to the FOS and following
the decision by the FOS to uphold the original complaint, the Group
has provided in full for the losses incurred by other clients who
were managed by this individual together with accrued interest. The
value of this provision totals GBP486,000.
Market data provision
During 2015 and 2016, a number of exchanges used by the Group
have been conducting audits in relation to data usage and
redistribution. The provision of GBP315,000 is the Group's best
estimate of the liability in relation to these open audits from the
relevant exchanges.
6. Related party transactions
Balances and transactions between the Company and its
subsidiaries, which are related parties, have been eliminated on
consolidation and are not disclosed in this note.
Trading Transactions
During the period, Group companies entered into the following
transactions with related parties who are not members of the
Group:
Unaudited Unaudited Audited
30 June 30 June 31 December 2015
2016 2015
GBP'000
GBP'000 GBP'000
Alogoweb Trading Services FZE (formerly Algoweb S.A.R.L) - purchase of
licence 600 600 1,200
---------- ---------- ------------------
600 600 1,200
========== ========== ==================
Loans from related parties
The following loan amounts:
Unaudited Unaudited Audited
30 June 30 June 31 December 2015
2016 2015
GBP'000
GBP'000 GBP'000
GLIO Holdings Limited - convertible loan note 13,332 13,332 13,332
---------- ---------- ------------------
13,332 13,332 13,332
========== ========== ==================
The following amounts were outstanding at the balance sheet
date:
Unaudited Unaudited Audited
30 June 30 June 31 December 2015
2016 2015
GBP'000
GBP'000 GBP'000
GLIO Holdings Limited - convertible loan note 13,332 11,705 13,332
Alogoweb Trading Services FZE (formerly Algoweb S.A.R.L) - purchase of
licence 300 300 300
TTCM Traders Trust Capital Markets Limited - - 101
---------- ---------- ------------------
13,632 12,005 13,733
========== ========== ==================
In 2014, a subsidiary Company entered into a licencing agreement
with Algoweb S.A.R.L. ("Algoweb"). On 18 September 2015, this
agreement was novated to Algoweb Trading Services FZE. The
Licencing agreement will allow the Group to access Algoweb's retail
distribution platforms and software, as well as connectivity to
post trade services. Algoweb is a related party of the Group
because Charles-Henri Sabet, Chief Executive Officer of London
Capital Group Holdings plc and his wife, together own 50 per cent
of the share capital in Algoweb.
GLIO Holdings Limited ("GLIO") is a related party of the Group
because Charles-Henri Sabet, Executive Chairman of London Capital
Group Holdings plc holds a 100% interest in ILOG Investments
Limited, GLIO's largest shareholder. The balance represents both
the liability and equity components of this transaction.
On 6 July 2016 the full amount of GLIO Holdings Limited's
convertible loan notes were redeemed and replaced with new share
capital.
7. Publication of Interim Results
The interim results for the six months ended 30 June 2016 will
be available on the Company's website http://ir.lcg.com/.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BBGDCGBXBGLG
(END) Dow Jones Newswires
September 30, 2016 07:14 ET (11:14 GMT)
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