TIDMADS
RNS Number : 9168M
Alexander David Securities Grp PLC
24 September 2012
Alexander David Securities Group plc
Interim results
for the six months to 30 June 2012
HIGHLIGHTS
-- Group revenue of GBP856,085 (2011: GBP1,509,070)
-- Gross profit of GBP623,231 (2011: GBP1,162,376)
-- Loss before tax of GBP148,039 (2011: GBP85,122)
Chairman's Statement
Dear Shareholders
The results for the six months to 30 June 2012 show how
difficult the market in the UK has been since the end of 2011. The
tough trading conditions of the second half of last year have
continued into the first half of 2012. The financial markets in the
UK, Europe and the USA have continued to be difficult and Alexander
David, like much of the sector in which it operates, has suffered a
significant reduction in revenues in this climate.
Our private client business has had mixed fortunes in the
period. As announced in February, we acquired the business of
Bridge Hall Stockbrokers. The first tranche of clients which we
acquired as part of that transaction were released to us in May.
The final tranche is due to be transferred shortly. Since that
period these clients have been trading well and have made a
contribution to the business above the acquisition costs. However,
our Contracts for Difference division has suffered as clients have
carried out fewer trades over the period and have effectively
de-risked themselves from this activity. In the period under
review, core private client revenues have fallen by 16%.
Overall this has led to a decline in the private client business
by some 38% compared to the same period last year and an increase
of 15% over the second half of 2011.
The retainer and advisory side of the corporate finance business
has been steady but overall has suffered from a lack of corporate
client fundraisings in the first half of 2012. In addition whilst
the team is working on a number of mandates market conditions have
made it difficult for all of these to move to market. Therefore the
income is down on a like for like basis with the first six months
of 2011 by 49%.
This has led to a 74% increase in our pre-tax loss to GBP148,000
for the six months to 30 June 2012 (2011: GBP85,000).
In light of the challenging conditions highlighted by the
Company above and in previous announcements in 2012, the Directors
have, for the most part deferred their salaries for the first half
of 2012.
Despite the difficult six months, the Board has also been
successful in containing other costs, which are down by 10% on the
previous six month period, and integrating the acquisition of the
private client business of Bridge Hall Stockbrokers. This has led
to an increase in clients of 311 from 896 to 1,207 over the
period.
Trading remains competitive and arduous in the current
environment and as a result the Directors are regularly reviewing
opportunities to protect shareholders in what they expect will
continue to be difficult market conditions.
The Board continues to review activities which include fund
management, wealth management, as shown by our recent launch of
Alexander David Wealth Management in association with Scottsdale
Consulting Limited. In addition, the Company continues to review
opportunities in commodity trading and fund advisory.
Current Trading
Despite the challenging times, and although turnover is down as
against the comparative period last year, when compared to the
previous six months at the end of 2011, it is up slightly. The
second half should see a full contribution of the acquisition of
Bridge Hall Stockbrokers and the core agency business of the
private client team is performing well. We have a number of
transactions in the corporate finance pipeline which are being
actively pursued. Some of these transactions are already funded or
do not require a funding from the capital markets. In addition, we
anticipate that there will be a number of opportunities for clients
to raise money in the public markets as we approach the year
end.
In these uncertain times the Board continues to work to ensure
that Alexander David will be in a position to benefit from any
improvements in market conditions as they happen.
Financial Review
6 Months ended 6 Months ended Year ended
Revenue 30 June 2012 30 June 2011 31 December 2011
Private Client 508,413 824,359 1,267,366
Corporate Finance 347,672 684,708 1,078,100
Other - - 9,667
TOTAL 856,085 1,509,070 2,355,135
Group total assets decreased to GBP1,423,000 (2011:
GBP1,424,000).
For further information please see www.ad-securities.com or
contact:
Michael Hicks, Chairman Alexander David Securities
David Scott, Chief Executive Group plc 020 7448 9800
James Cathie, Avi Robinson Cairn Financial Advisers
Nominated Adviser LLP 020 7148 7900
Bill Sharp Alexander David Securities
Broker Limited 020 7448 9800
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the Six Months to 30 June 2012
6 Months 6 Months Year ended
to 30 June to 30 June 31 December
2012 unaudited 2011 unaudited 2011
audited
GBP'000 GBP'000 GBP'000
Revenue 856 1,509 2,355
Cost of Sales (233) (347) (537)
---------------- -------------------- -------------
Gross Profit 623 1,162 1,819
Administrative expenses (770) (1,072) (1,994)
Operating profit/(loss) (147) 90 (175)
Investment income 8 (175) (316)
Finance costs (9) - (3)
Loss before taxation (148) (85) (493)
Taxation - - -
Loss after taxation (148) (85) (493)
Other comprehensive income - - -
---------------- -------------------- -------------
Total comprehensive income (148) (85) (493)
---------------- -------------------- -------------
Basic and diluted loss per share from
continuing and total operations (0.02)p (0.01)p (0.07)p
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2012
As at 30 As at As at
June 2012 30 June 31 December
unaudited 2011 unaudited 2011 audited
GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Property, plant and equipment 1 5 3
Intangible assets 485 485 485
----------- ---------------- --------------
486 490 488
----------- ---------------- --------------
Current Assets
Listed Securities 406 322 210
Trade and other receivables 531 578 340
Cash and cash equivalents - 34 57
----------- ----------------
937 934 608
Total assets 1,423 1,424 1,096
----------- ---------------- --------------
Equity and liabilities
Equity
Share capital 2,882 2,772 2,882
Share premium 1,462 1,351 1,462
Merger reserve 3,278 3,278 3,278
Preference Shares 2,074 1,724 1,724
Reverse acquisition reserve (5,036) (5,036) (5,036)
Accumulated losses (4,019) (3,470) (3,871)
----------- ---------------- --------------
641 619 439
----------- ---------------- --------------
Non-current liabilities
Subordinated loan notes 142 139 140
Current liabilities
Trade and other payables 625 666 517
Cash and cash equivalents 15 - -
----------- ---------------- --------------
640 666 517
----------- ---------------- --------------
Total equity and liabilities 1,423 1,424 1,096
----------- ---------------- --------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the Six Months to 30 June 2012
Share Share Rev. Merger Preference Accumulated Total
capital premium Acq Reserve Shares losses
Reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January
2011 2,772 1,351 (5,036) 3,278 1,724 (3,385) (704)
Loss for the period - - - - - (85) (85)
Balance at 30 June 2011
(unaudited) 2,772 1,351 (5,036) 3,278 1,724 (3,470) 619
-------- --------- --------- --------- --------------------- ------------ ----------
Issue of Share Capital 110 111 - - - - 221
Credit for share based
payment - - - - - 7 7
Loss for the period - - - - - (408) (408)
Balance 31 December
2011
(audited) 2,882 1,462 (5,036) 3,278 1,724 (3,871) 439
-------- --------- --------- --------- --------------------- ------------ ----------
New Preference Shares - - - - 350 - 350
Loss for the period - - - - - (148) (148)
Balance at 30 June 2012
(unaudited) 2,882 1,462 (5,036) 3,278 2,074 (4,019) 641
======== ========= ========= ========= ===================== ============ ==========
CONSOLIDATED CASH FLOW STATEMENT
for the Six Months to 30 June 2012
6 Months 6 Months Year ended
to 30 June to 30 June 31 December
2012 unaudited 2011 unaudited 2011
audited
GBP'000 GBP'000 GBP'000
Loss before taxation (148) (85) (493)
Loss/(profit) on principal trading (173) (40) 87
Share based payments - - -
Investment income - - -
Finance costs - - 2
Depreciation 2 4 6
Decrease/(increase) in receivables (191) (195) 41
Increase/(decrease) in payables 111 29 (120)
---------------- ---------------- -------------
Cash outflow from operations (399) (287) (470)
---------------- ---------------- -------------
Interest paid - - -
Net cash outflow from operating
activities (399) (287) (470)
---------------- ---------------- -------------
Cash flow from investing activities:
Purchase of assets at fair value
through profit and loss - (148) (68)
Sale of assets at fair value through
profit and loss - 163 67
Net cash used in investing activities - 15 (1)
---------------- ----------------
Cash flow from financing activities:
Issue of equity shares - - 221
Issue of preference shares 350 - -
Net cash from financing activities 350 - 221
---------------- ---------------- -------------
Net increase in cash and cash equivalents (49) (272) (249)
Cash and cash equivalents at beginning
of period 34 306 307
Cash and cash equivalents at end
of period (15) 34 58
---------------- ---------------- -------------
Accounting Policies
Interim Accounts for the Six Months to 30 June 2012
1. Basis of preparation and accounting policies
These condensed interim statements have been prepared in
accordance with IAS34, 'Interim Financial Reporting', as adopted by
the European Union on a basis consistent with International
Financial Reporting Standards (IFRS). They do not contain all of
the information required for full financial statements and should
be read in conjunction with the consolidated financial statements
of the Group as at and for the year ended 31 December 2011. These
interim financial statements do not constitute statutory accounts
within the meaning of the Companies Act.
The interim financial information is not audited. The interim
financial information was approved by the Board of Directors on 20
September 2012. The information for the year ended 31 December 2011
is extracted from the statutory financial statements for that year
which have been reported on by the Group's auditors and delivered
to the Registrar of Companies. The audit report was
unqualified.
The accounting policies applied by the Group in these interim
financial statements are the same as those applied by the Group in
its consolidated financial statements for the year ended and as at
31 December 2011.
2. Earnings per share
Six months Six months Year ended
to 30 June to 30 June 31 December
2012 2011 2011
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Loss for the purpose of basic
and diluted loss per share (148) (85) (493)
------------ ------------ -------------
Number of shares:
Weighted average number of
shares in issue during the
year 742,544,869 631,794,869 677,611,992
Effect of outstanding options - - -
------------ ------------ -------------
Adjusted weighted average number
of shares 742,544,869 631,794,869 677,611,992
------------ ------------ -------------
Basic and diluted loss per
share from continuing and total
operations (0.02)p (0.01)p (0.07)p
------------ ------------ -------------
3. Segmental reporting
Business Segments
The Group adopted IFRS8 Operating Segments with effect from I
January 2009. IFRS 8 requires operating segments to be identified
on the basis of internal reports about components of the Group that
are regularly reviewed by the Directors. The Directors allocate
resources to the segments to assess their performance.
Corporate Finance
This segment provides corporate finance and corporate broking
services to small and mid cap companies
Private Clients
The Private Client team provides advice regarding cash equity
and derivative products and execution services to private and high
net worth clients.
Segmental Analysis
6 Months to Corporate Private Unallocated Total
30 Jun 2012 Finance Client Sales
GBP'000 GBP'000 GBP'000 GBP'000
UK 310 508 - 817
Overseas 38 - - 39
Total Revenue 348 508 - 856
6 Months to Corporate Private Unallocated Total
30 Jun 2011 Finance Client Sales
GBP'000 GBP'000 GBP'000 GBP'000
UK 611 824 - 1,435
Overseas 74 - - 74
Total Revenue 685 824 - 1,509
12 Months to Corporate Private Unallocated Total
31 Dec 2011 Finance Client Sales
GBP'000 GBP'000 GBP'000 GBP'000
UK 713 1,170 10 1,892
Overseas 365 98 - 463
Total Revenue 1,078 1,267 10 2,355
4. Segmental reporting(Continued)
Revenue Analysis
6 Months to 30 Corporate Private Unallocated Total
Jun 2012 Finance Client Sales
GBP'000 GBP'000 GBP'000 GBP'000
Fees 288 27 - 315
Trading 60 - - 60
Commissions - 404 - 404
Securities - 77 - 77
Total Revenue 348 508 - 856
Cost of sales (13) (220) - (233)
Gross profit 335 289 - 623
Admin Expenses (283) (488) - (770)
Operating Profit/(loss) 52 (199) - (147)
Investment income 8 - - 8
Finance costs (3) (6) - (9)
(Loss) Profit
for the Year 57 (205) - (148)
6 Months to 30 Corporate Private Unallocated Total
Jun 2011 Finance Client Sales
GBP'000 GBP'000 GBP'000 GBP'000
Fees 461 - - 461
Trading - - - -
Commissions 119 706 - 825
Securities 105 118 - 223
Total Revenue 685 824 - 1,509
Cost of sales (40) (306) - (346)
Gross profit 645 518 - 1,163
Admin Expenses (411) (621) (40) (1,072)
Operating Profit/(loss) 234 (103) (40) 91
Investment income (175) - - (175)
Finance costs - - - -
(Loss) Profit
for the Year 59 (103) (40) (84)
12 Months to 31 Corporate Private Research Total
Dec 2011 Finance Client Sales
GBP'000 GBP'000 GBP'000 GBP'000
Fees 570 - 10 580
Trading 509 - - 509
Commissions - 1,091 - 1,091
Securities - 176 - 176
Total Revenue 1,079 1,267 10 2,356
Cost of sales (69) (468) - (537)
Gross profit 1,010 799 10 1,819
Admin Expenses (772) (1,092) (130) (1,994)
Investment income (366) 50 - (316)
Finance costs - - (2) (2)
(Loss) Profit
for the Year (128) (243) (122) (493)
The accounting policies of the reportable segments are the same
as the group accounting policies. Segment profit represents the
profit earned by each segment after allocating an appropriate
proportion of overheads and support function expenses to each
revenue centre.
The directors do not consider the Group's operations to be
subject to significant seasonal fluctuation.
5. Related party transactions
Key management are those persons having authority and
responsibility for planning, controlling and directing the
activities of the Company. In the opinion of the Board, the
Company's key management are the Directors of the Company.
Information regarding their compensation is given below in
aggregate for each of the categories specified in IAS 24 Related
Party Disclosures:
6 months 6 months Year
to 30 to 30 Ended
June 2012 June 2011 31 Dec
2011
GBP'000 GBP'000 GBP'000
Short-term employee benefits 117 155 282
117 155 282
=========== =========== =========
Included in Directors' emoluments is an amount of GBP11,000
invoiced to the Company by a company controlled by Mr M Hicks.
During the period to 30 June 2012 the Group received income from
share trading conducted through Jarvis Investment Management plc.
Jarvis Investment Management PLC is the trading subsidiary of
Jarvis Securities plc. The chief executive of Jarvis Securities
plc, Andrew Grant, is a shareholder of Alexander David Securities
Group plc and was a Director until he resigned on 8 August 2012.
The total income derived from trading through Jarvis Investment
Management PLC was GBP387,256. Transactions are undertaken on a
normal commercial basis. At the period end there was a balance of
GBP2,749 due from Jarvis Investment Management plc.
6. Ultimate controlling party
The Directors do not consider there to be a single ultimate
controlling party.
7. Directors' responsibility statement
The interim report is the responsibility of, and has been,
approved by the Directors. The Directors are responsible for
preparing the interim financial statements in accordance with the
AIM Rules for Companies.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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