TIDMOPM
RNS Number : 9490M
1PM PLC
26 January 2016
For Immediate Release 26(th) January 2016
1pm plc
("1pm", the "Group" or the "Company")
INTERIM RESULTS
FOR THE SIX MONTHS ENDED 30(th) NOVEMBER 2015
Strong trading momentum maintained;
Further profitable growth at both 1pm and newly-acquired Academy
Leasing;
Aggregate Portfolio stood at GBP57m at period end; Earnings per
share increased 54%
1pm, the AIM listed independent specialist provider of finance
facilities to the SME sector, announces Interim Results for the six
month period ended 30(th) November 2015 which include a first
contribution from Academy Leasing from 25(th) August 2015 to 30(th)
November 2015.
Financial Highlights
-- Revenue for the period more than doubled to GBP5.25m (H1 2015: GBP2.56m);
-- Profit before tax more than doubled to GBP1.66m (H1 2015: GBP0.76m);
-- Earnings per share increased 52% to 2.91p (H1 2015: 1.91p);
-- Net receivables increased 135% to GBP47.94m (H1 2015: GBP20.42m);
-- Bad debt write-off in the period amounted to GBP0.16m,
representing 0.28% of the total portfolio
(H1 2015: GBP0.11m, representing 0.46% of the total
portfolio)
Operational Highlights
-- GBP12m acquisition of Academy Leasing successfully completed
in August 2015, funded by a net GBP6.9m of new equity finance,
GBP1m of vendor loan notes and issue of ordinary shares;
-- New lease and hire purchase contracts written during the
period increased to GBP9.7m (H1 2015: GBP5.8m);
-- New business loan contracts written during the period
amounted to GBP6.1m (H1 2015: GBP1.0m)
-- Total portfolio increased to GBP57.0m (H1 2015: GBP24.3m);
-- New revenue stream of GBP0.45m in the period from lease and vehicles commissions;
-- Organic growth funded by increased use of existing
facilities, additional debt funding of GBP2.35m (H1 2015: GBP5.7m)
and reinvestment of GBP4.5m of cash flow from operations (H1 2015:
GBP3.0m).
Commenting on the results, Chairman, Ian Smith, said:
"1pm's results for the first six months of the current financial
year continue the trend of profitable growth delivered over recent
years and, although only three months since its acquisition, the
equally strong results of Academy Leasing clearly justify the
decision to expand the Group. Investment in resources at 1pm
earlier in 2015 and the Academy Leasing acquisition completed in
August 2015 mark the first successful steps towards achieving our
strategic aims. We look forward to the second half of the financial
year with optimism and confidence".
For further information,
please contact:
1pm plc
Ian Smith, Chairman 01225 474230
Mike Nolan, Chief Strategy
and Risk Officer 01942 408520
Helen Walker, Chief Financial
Officer 01225 474230
WH Ireland (NOMAD)
Mike Coe / Ed Allsopp 0117 945 3470
Walbrook PR Limited 0117 985 8989
Paul Vann 07768 807631
paul.vann@walbrookpr.com
About 1pm:
The Company was admitted to AIM in August 2006.
1pm plc is an established group of independent finance companies
focused on providing SMEs with accessible funding to add value to
their businesses. All customers must have good credit histories and
proven ability to repay their finance commitments.
Mission Statement - 'Helping the UK economy grow by supporting
SMEs'
More information is available on the Company website
www.1pm.co.uk
CHAIRMAN'S STATEMENT
Financial Results
I am pleased to report that the Group continued to make good
progress during the first half of the current financial year. The
financial results achieved for the six months ended 30(th) November
2015 ("the period") give cause for optimism and confidence in the
outcome of the year to 31(st) May 2016 as a whole.
The half-year results include a first contribution from Academy
Leasing Limited ("Academy") for the period 25(th) August 2015 to
30(th) November 2015. Academy, a provider of equipment finance and
an equipment and vehicles broker to the SME market, is the only
trading company within the MH Holdings (UK) Limited group of
companies ("MH Holdings"), which was acquired by 1pm plc on 25(th)
August 2015 (the "Acquisition").
Total revenue amounted to GBP5.25m (H1 2015: GBP2.56m). In
addition to the revenue generated from lease and hire purchase
contracts by 1pm and Academy, a further GBP0.45m of commission
income was generated by Academy in the period in respect of the
broking-on of equipment and vehicles contracts.
Profit before tax more than doubled to GBP1.66m (H1 2015:
GBP0.76m). This profit figure is stated after charging GBP0.1m of
non-recurring costs relating to the Acquisition. Profit after tax
in the period rose to GBP1.31m (H1 2015: GBP0.60m).
Excluding the first contribution from Academy, 1pm increased its
revenue by 48% and its profit before tax by 52% in the period
compared with the equivalent period in the previous financial
year.
Earnings per share ("EPS") increased 52% to 2.91p (H1 2014:
1.91p). EPS before the non-recurring costs in the period was 3.13p.
EPS has been calculated on a weighted average basis taking into
account the issue of 15,679,893 new ordinary shares on 26(th)
August 2015 in connection with the financing of the Acquisition. At
the period end a total of 52,534,463 ordinary shares were in
issue.
The Group paid a maiden dividend as a final dividend in respect
of the financial year ended 31(st) May 2015. It is the Board's
intention to replicate this policy in the current financial year
with one dividend payment, being a final dividend in respect of the
current financial year ending 31(st) May 2016.
At the period end, the Group's consolidated net assets stood at
GBP25.2m (H1 2015: GBP11.7m). Profit after tax in the period
therefore represents a 5.2% return on net assets (H1 2015:
5.2%).
Operations
In the period, the Group experienced strong demand across its
product range from its core SME customer base. It originated
GBP9.7m of new lease and hire purchase contracts, a 67% increase
over the same period last year (H1 2015: GBP5.8m) and GBP6.1m of
business loans, a six-fold increase compared to last year (H1 2015:
GBP0.96m). To fund this organic growth the Group increased use of
its existing block funding facilities, raised additional debt
funding of GBP2.35m (H1 2015: GBP5.7m) and reinvested GBP4.5m of
free cash flow generated from receivables (H1 2015: GBP3.0m).
Following the acquisition of Academy, the Group now has
considerably greater flexibility to manage the mix of new business
origination between lease, hire purchase and loan contracts and the
capacity to broke-on equipment and vehicles business to generate
cash from commissions. This flexibility and additional capacity
will enable the Group to continue to grow profitability whilst
optimising its risk profile.
At the period-end the Group's combined lease and loan portfolios
amounted to GBP57.0m, comprising GBP39.4m at 1pm (H1 2015:
GBP24.3m) and GBP17.6m at Academy. Approximately 55% of new lease
and hire purchase contracts at Academy are broked-on to generate
commission income.
The average contract value in the portfolio in the period was
GBP10.8k (H1 2015: GBP9.8k) with no single customer representing
more than 0.21% of the total portfolio value (H1 2015: 0.51%).
During the period, the Group's strict financial controls were
maintained, with just GBP0.16m written off as bad debt,
representing 0.28% of the aggregate portfolio value (H1 2015:
GBP0.1m representing 0.46% of the portfolio).
Strategy
It is pleasing to report that trading at Academy since the
Acquisition is in line with management's expectations and
consistent with its stated strategic and operational objectives.
Against this background and with the financial results at both 1pm
and Academy continuing to be strong, the Group has confidence in
pursuing its further strategic growth plans. These include the
addition of complementary products, an expanded funding mix to
include a wider range of borrowing facilities and consideration of
potential further acquisitions.
Board changes
As announced on 27(th) November 2015, with effect from 1(st)
February 2016, I will become Group CEO and John Newman, currently a
non-executive director, will be appointed Chairman.
The Board also announces that Maria Lewis, Chief Operating
Officer, will be leaving 1pm on 31(st) January 2016 and will step
down as a director of both 1pm plc and 1pm (UK) Limited with effect
from that date. The Board would like to record its appreciation and
gratitude to Maria for her operational stewardship of the business
and for the part she played in steering 1pm to a position of
financial strength. The Board is pleased to also announce that
Maria will continue her involvement with the business and will act
for the Group in an ad-hoc consulting capacity.
Outlook
Notwithstanding some recent uncertainty over the global economic
outlook, demand within the UK SME sector for our products and
services remains strong. Competition is increasing, but we continue
to expand our broker network and equipment supplier-base which has
contributed to the significant increase in new lease and hire
purchase contracts written in the period.
(MORE TO FOLLOW) Dow Jones Newswires
January 26, 2016 02:00 ET (07:00 GMT)
The financial results of 1pm for the period continue the trend
of profitable growth delivered in recent years. The results of
Academy clearly justify the first step in the planned strategic
expansion of the Group and give confidence in relation to further
expansion plans. The Board is committed to delivering sustainable
growth and building value for shareholders. Accordingly, the Board
looks forward to the second half of the financial year with
optimism and confidence. I would like to thank our staff,
shareholders, advisors, clients, finance brokers and funding
partners for their continued support.
Ian Smith
Chairman, 1pm plc
Independent Review Report to 1pm plc
Introduction
We have been instructed by the Company to review the financial
information set out on pages 6 to 10 and we have read the other
information contained in the interim report and considered whether
it contains any apparent misstatements or material inconsistencies
with the financial information.
Directors' responsibilities
The interim report, including the financial information
contained therein, is the responsibility of, and has been approved
by the directors. The directors are responsible for preparing the
half-yearly financial report in accordance with the rules of the
London Stock Exchange for companies trading securities on AIM, a
market operated by the London Stock Exchange plc. The Disclosure
and Transparency Rules require that the accounting policies and
presentation applied to the half yearly figures must be consistent
with those applied in the latest published annual accounts except
where the accounting policies and presentation are to be changed in
the subsequent annual financial statements, in which case the new
accounting policies and presentation should be followed, and the
change and the reasons for the changes should be disclosed in the
half yearly financial report. The condensed set of financial
statements included in this half yearly financial report has been
prepared in accordance with International Accounting Standard 34,
"Interim Financial Reporting".
Our responsibility
Our responsibility is to express a conclusion on the condensed
set of financial statements in the half yearly financial report
based on our review.
Scope of Review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410 "Review of
Interim Financial Information performed by the Independent Auditor
of the Entity," issued by the Auditing Practices Board for use in
the United Kingdom. A review consists principally of making
enquiries of group management and applying analytical and other
review procedures to the financial information. A review excludes
audit procedures such as tests of controls and verification of
assets, liabilities and transactions. It is substantially less in
scope than an audit performed in accordance with Auditing Standards
and therefore provides a lower level of assurance than an audit.
Accordingly we do not express an audit opinion on the financial
information.
Review conclusion
On the basis of our review, nothing has come to our attention
that causes us to believe that the condensed set of financial
statements in the half yearly financial report for the six months
ended 30 November 2015 is not prepared, in all material respects,
in accordance with International Accounting Standard 34.
Moore Stephens
Registered Auditors
Chartered Accountants
30 Gay Street
Bath BA1 2PA
25 January 2016
CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME
FOR THE SIX MONTHS TO 30 NOVEMBER
2015
Independently Independently Audited
Reviewed Reviewed 12 months
6 months 6 months to
to to 30 31 May
30 November November
2015 2014 2015
Note GBP GBP GBP
REVENUE 5,253,091 2,560,943 5,533,990
Cost of sales (1,859,886) (1,161,718) (2,503,253)
-------------- -------------- -------------
GROSS PROFIT 3,393,205 1,399,225 3,030,737
Administrative expenses (1,604,101) (625,977) (1,393,636)
-------------- -------------- -------------
OPERATING PROFIT BEFORE
EXCEPTIONAL ITEM 1,789,104 773,248 1,637,101
Exceptional item - acquisition
costs (98,614) - -
-------------- -------------- -------------
OPERATING PROFIT BEFORE
EXCEPTIONAL ITEM 1,690,490 773,248 1,637,101
Finance income 804 1,165 3,373
Finance expense (32,171) (12,209) (20,857)
-------------- -------------- -------------
PROFIT BEFORE TAXATION 1,659,123 762,204 1,619,617
Taxation (343,661) (160,055) (349,003)
-------------- -------------- -------------
PROFIT AFTER TAXATION 1,315,462 602,149 1,270,614
============== ============== =============
Attributable to equity
holders of the company 1,315,462 602,149 1,270,614
============== ============== =============
Profit per share attributable
to the equity holders
of the company during
the Period
Pence per Pence Pence
share per share per share
- basic and diluted 5 2.91 1.91 3.72
============== ============== =============
All of the above amounts are in respect
of continuing operations.
CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
FOR THE SIX MONTHS TO 30 NOVEMBER
2015
Independently Independently Audited
Reviewed Reviewed 12 months
6 months 6 months to
to to 30 31 May
30 November November
2015 2014 2015
GBP GBP GBP
FIXED ASSETS
NON CURRENT ASSETS
Intangible assets - goodwill 8,804,619 - -
Property, plant and equipment 1,052,599 224,378 239,214
9,857,218 224,378 239,214
-------------- -------------- -------------
CURRENT ASSETS
Cash at bank and in hand 469,809 2,957,442 12,000
Trade and other receivables 47,935,868 20,415,351 24,991,236
-------------- -------------- -------------
48,405,677 23,372,793 25,003,236
CURRENT LIABILITIES
Trade and other payables 17,311,799 6,043,939 7,048,879
-------------- -------------- -------------
NET CURRENT ASSETS 31,093,878 17,328,854 17,954,357
TOTAL ASSETS LESS CURRENT
LIABILITIES 40,951,096 17,553,232 18,193,571
NON CURRENT LIABILITIES
Trade and other payables 15,791,795 5,889,882 5,824,596
-------------- -------------- -------------
25,159,301 11,663,350 12,368,975
-------------- -------------- -------------
EQUITY
Called up share capital 5,253,446 3,692,260 3,685,457
Share premium account 13,064,319 5,645,387 5,606,347
Consideration shares
to be issued 2,528,292 - -
Employee shares to be
issued 132,602 - 83,002
Retained earnings 4,180,642 2,325,703 2,994,169
-------------- -------------- -------------
TOTAL EQUITY 25,159,301 11,663,350 12,368,975
-------------- -------------- -------------
CONSOLIDATED INTERIM CASH FLOW STATEMENT FOR
THE SIX MONTHS TO 30 NOVEMBER 2015
Independently Independently Audited
Reviewed Reviewed 12 months
6 months 6 months to
to to 30 31 May
30 November November
(MORE TO FOLLOW) Dow Jones Newswires
January 26, 2016 02:00 ET (07:00 GMT)
2015 2014 2015
Cash flows from operating
activities
Cash generated from operations 790,824 (95,873) (3,294,279)
Interest Paid (32,171) (12,209) (20,857)
Tax paid - - (297,322)
Dividends paid (128,989) - -
-------------- -------------- ------------
Net cash generated from
operating activities 629,664 (108,082) (3,612,458)
-------------- -------------- ------------
Cash flows from investing
activities
Interest received 804 1,165 3,373
Purchase of tangible
fixed assets (82,159) (173,744) (245,826)
-------------- -------------- ------------
Net cash generated from
investing activities (81,355) (172,579) (242,453)
-------------- -------------- ------------
Cash flows from financing
activities
Repayment of loans - (380,000) (180,000)
Issue of shares net of
costs 6,365,064 4,018,475 4,090,333
Acquisition (6,098,614) - -
-------------- -------------- ------------
Net cash generated from
financing activities 266,450 3,638,475 3,910,333
-------------- -------------- ------------
Increase in cash and
cash
equivalents 814,759 3,357,814 55,422
Cash and cash equivalents
at the beginning of the
period (344,950) (400,372) (400,372)
-------------- -------------- ------------
Cash and cash equivalents
at the end of the period 469,809 2,957,442 (344,950)
============== ============== ============
CONSOLIDATED STATEMENT OF CHANGES IN
EQUITY
FOR THE SIX MONTHS TO 30 NOVEMBER
2015
Share Share Retained Consideration Employee Total
Capital Premium Earnings Shares Shares Equity
Balance
at 31
May 2015 3,685,457 5,606,347 2,994,169 - 83,002 12,368,975
Movement
in share
capital 1,567,989 7,457,972 - 2,528,292 49,600 9,075,561
Profit
for period
- - 1,315,462 - - 1,315,462
Dividend
paid - - (128,989) - - (128,989)
Balance
at 30
November
2015 5,253,446 13,064,319 4,180,642 2,528,292 132,602 25,159,301
============ ============= ============ ==================== ========== =============
Balance
at 30
November
2014 3,692,260 5,645,386 2,325,704 - - 11,663,350
Movement
in share
capital (6,803) (39,039) - - 83,002 37,160
Profit
for Period - - 668,465 - - 668,465
Balance
at 31
May 2015 3,685,457 5,606,347 2,994,169 - 83,002 12,368,975
============ ============= ============ ==================== ========== =============
1 BASIS OF PREPARATION
The financial information set out in the interim
report does not constitute statutory accounts as
defined in section 434(3) and 435(3) of the Companies
Act 2006. The Group's statutory financial statements
for the year ended 31 May 2015 prepared in accordance
with IFRS as adopted by the European Union and with
the Companies Act 2006 have been filed with the Registrar
of Companies. The auditor's report on those financial
statements was unqualified and did not contain a
statement under Section 498(2) of the Companies Act
2006. These interim financial statements have been
prepared under the historical cost convention.
These interim financial statements have been prepared
in accordance with the accounting policies set out
in the most recently available public information,
which are based on the recognition and measurement
principles of IFRS in issue as adopted by the European
Union (EU) and are effective at 31 May 2015. The
financial information for the six months ended 30
November 2014 and the six month period 30 November
2015 are unaudited and do not constitute the Groups
statutory financial statements for these periods.
The accounting policies have been applied consistently
throughout the Group for the purposes of preparation
of these interim financial statements.
2 BASIS OF CONSOLIDATION
The consolidated financial statements incorporate
the financial statements of the Company and entities
controlled by the Company (its subsidiaries). Control
is achieved where the Company has the power to govern
the financial and operating policies of an entity
so as to obtain benefit from its activities.
All intra-group transactions, balances, income and
expenses are eliminated on consolidation.
3 TAXATION
Taxation charged for the period ended 30 November
2015 is calculated by applying the directors' best
estimate of the annual tax rate to the result for
the period.
4 SHARE CAPITAL
The Articles of Association of the company state
that there is an unlimited authorised share capital.
Each share carries the entitlement to one vote.
On 26 August 2015 the Company issued shares for cash
to the value of GBP7,263m (before expenses) by way
of an Open Offer and Placing of 12,104,181 ordinary
shares of nominal value 0.10p at 0.60p per share.
In addition on the same date the Company allotted
3,575,712 ordinary shares of 0.10p at 0.67p per share
in consideration for the acquisition of MH Holdings
(UK) Limited.
During the six months to 30 November 2015, an amount
of GBP49,600, representing 81,311 shares of nominal
value 0.10p at a price of 0.61p per share, has been
accrued in relation to employee and director share
schemes (18,333 for employees and 62,978 for directors).
None of the shares had been issued as at 30 November
2015.
EARNINGS PER ORDINARY
5 SHARE
The earnings per ordinary share has been calculated
using the profit for the period and the weighted
average number of ordinary shares in issue and accrued
during the period as follows:
6 months 6 months
to to
30-Nov-15 30-Nov-14
GBP GBP
Profit for the period
after taxation 1,315,462 602,149
Number Number
45,165,770 31,586,768
Basic weighted average
of ordinary shares
post consolidation
Pence Pence
per per
share share
Basic earnings (pence
per share) 2.912519 1.906333
The basic earnings per share is calculated on the
weighted average number of shares in issue and accrued
during the period.
COPIES OF THE INTERIM
6 REPORT
Copies of the Interim Report are available from www.1pm.co.uk
and the Company Secretary at the registered office:
2(nd) Floor, St James House, The Square, Lower Bristol
Road, Bath BA2 3BH
This information is provided by RNS
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January 26, 2016 02:00 ET (07:00 GMT)
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