TIDMADS
RNS Number : 1867P
Alexander David Securities Grp PLC
30 September 2011
ALEXANDER DAVID SECURITIES GROUP PLC
(the "Company")
HALF YEARLY REPORT
HIGHLIGHTS
-- Group revenue of GBP1,509,070 (2010: GBP1,450,119) up
4.1%
-- Corporate revenue GBP622,398 (2010: GBP440,976) up 41%
-- Operating profit GBP92,000 (2010: GBP(193,000)); maiden
operating profit
-- Investment write down GBP175,000 (2010: GBP97,000)
-- Loss before tax of GBP85,122 (2010: GBP294,119) reduced by
71%
Chairman's Statement
I am pleased to present the half yearly report for the six
months to 30 June 2011. In our trading statement issued on 29 July
we indicated that we had seen a strong start to 2011.
Sales continued well with the Company trading at or marginally
ahead of where it was last year. The cost savings we made, which on
an annualised basis amount to some GBP600,000, have helped to
reduce the loss before tax to GBP85,122 (2010: GBP294,119).
Turnover in corporate finance has been particularly strong with
revenues up 41%, albeit GBP269,000 of the fees recognized in this
number were received in the form of options or warrants.
The Company has benefitted from the cost savings which were made
at the year end and the benefit of these are being shown in these
results. The headcount was reduced by 20% and, as a result,
turnover per employee increased for the 6 months from GBP36,000 to
GBP47,000.
In line with market practice we have revalued our stock
portfolio. Prior to revaluation the Company made an operating
profit of GBP92,000 (2010: GBP(193,000)). The directors believe
this is a good performance against a market background which has
seen a reduction of business globally and a 30% fall in the number
of equity placings on the stock exchange this year. At the six
month end the portfolio was valued at GBP320,000 (2010:
GBP132,000).
In the July trading statement we notified the market that
Alexander David Securities was expected to be profitable to July
2011. In addition, we raised GBP221,500 for additional working
capital as we were concerned that the equity markets could be very
volatile in the next five months. This prediction has been borne
out in August and September and the Directors are pleased to have
added additional capital to the Company to strengthen the balance
sheet at this time.
Financial review
Year ended 31
6 Months ended 30 6 Months ended 30 December 2010
Revenue June 2011 (GBP) June 2010 (GBP) (GBP)
Private Client 824,359 838,792 1,718,000
Corporate Finance 622,398 440,976 620,000
Institutional &
Corporate
Broking sales 62,313 155,766 194,000
Research 0 0 20,000
Gain/(loss) on
investments 0 14,585 0
TOTAL 1,509,070 1,450,119 2,552,000
Administrative costs for the six month period were down
approximately 20% on the same period last year.
Group total assets decreased to GBP1,424,000 (2010:
GBP1,485,000).
Operational review
Alexander David has focused on reducing costs and maintaining
revenues during 2011. In the first six months of the year it has
achieved this goal. The Corporate Finance business has performed
strongly in the first half. The Private Client business has added
an additional 93 accounts in the first half of the year and broadly
maintained its revenue contribution despite the more difficult
trading conditions.
The Institutional and Corporate Broking team has also performed
satisfactorily, participating in nine secondary placings in the six
months to 30 June, although it has reduced revenue for the period
to date.
The Group has significantly reduced the losses from June 2010,
the major reason being substantial reduction in non-fee earning
staff and a reduction in administrative expenses.
Outlook
Despite the challenging climate the Board continues to see a
robust pipeline of corporate activities which are being actively
worked on. The UK and global equities market volumes are down on
previous years and as a result the broking business has been
quieter in August and September but the Board is confident that it
will continue to contribute to the ongoing growth of the
business.
The Board remains positive about the prospects for the rest of
the year.
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 Caithie
Nominated Adviser Cairn Financial Advisers 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 2011
6 Months
to 30 Year ended
June 6 Months 31 December
2011 to 30 June 2010
unaudited 2010 unaudited audited
GBP'000 GBP'000 GBP'000
Revenue 1,509 1,450 2,552
Cost of Sales (347) (311) (551)
----------- ---------------- -------------
Gross Profit 1,162 1,139 2,001
Administrative expenses (1,072) (1,332) (2,887)
Exceptional Item - - (146)
Operating profit/(loss) 90 (193) (1,032)
Investment (write down)/ income (175) (97) 70
Finance costs - (4) (8)
Loss before taxation (85) (294) (970)
Taxation - - -
Loss after taxation (85) (294) (970)
Other comprehensive income - - -
----------- ---------------- -------------
Total comprehensive income (85) (294) (970)
----------- ---------------- -------------
Basic and diluted loss per
share from continuing and
total operations (0.01)p (0.06)p (0.19)p
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2011
As at 30 As at 30 As at
June 2011 June 2010 31 December
unaudited unaudited 2010 audited
GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Property, plant and equipment 5 14 9
Intangible assets 485 485 485
----------- ----------- --------------
490 499 494
----------- ----------- --------------
Current assets
Listed Securities 322 132 297
Trade and other receivables 578 540 381
Cash and cash equivalents 34 314 306
----------- -----------
Total current assets 934 986 984
Total assets 1,424 1,485 1,478
----------- ----------- --------------
Equity and liabilities
Equity
Share capital 2,772 2,639 2,772
Share premium 1,351 1,120 1,351
Merger reserve 3,278 3,278 3,278
Preference Shares 1,724 1,724 1,724
Reverse acquisition reserve (5,036) (5,036) (5,036)
Accumulated losses (3,470) (2,717) (3,385)
----------- ----------- --------------
619 1,008 704
----------- ----------- --------------
Non-Current liabilities
Subordinated loan notes 139 130 137
Current liabilities
Trade and other payables 666 347 637
----------- ----------- --------------
Total liabilities 805 477 774
----------- ----------- --------------
Total equity and liabilities 1,424 1,485 1,478
----------- ----------- --------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the Six Months to 30 June 2011
Share Share Rev.Acq Merger Preference Accumulated
capital premium Reserve Reserve Shares losses Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January
2010 2,639 1,120 (5,036) 3,278 (2,423) (422)
Conversion of
subordinated debt to
preference shares - - - 1,724 1,724
Loss for the period - - - - - (294) (294)
Balance at 30 June 2010
(unaudited) 2,639 1,120 (5,036) 3,278 1,724 (2,717) 1,008
-------- -------- -------- -------- ----------- -------------- ------------------
Issue of Share Capital 133 231 - - - - 364
Credit for share based
payment - - - - - 8 8
Loss for the period - - - - - (676) (676)
Balance 31 December 2010
(audited) 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
======== ======== ======== ======== =========== ============== ==================
CONSOLIDATED CASH FLOW STATEMENT
for the Six Months to 30 June 2011
Year ended
6 Months 6 Months 31 December
to 30 June to 30 June 2010
2011 2010 unaudited audited
GBP'000 GBP'000 GBP'000
Loss before taxation (85) (294) (970)
Options & Warrants received in
lieu of fees (269) (38) (32)
Loss/(profit) on principal
trading (15) 3 10
Share based payments - - 8
Investment income - - (14)
Finance costs - 6 8
Depreciation 4 6 11
Decrease/(increase) in
receivables (195) (236) (78)
Changes in value of
assets at fair value 244 95 (56)
Increase/(decrease) in
payables 29 (118) 172
------------ ---------------- -------------
Cash outflow from
operations (287) (576) (941)
------------ ---------------- -------------
Interest paid - (6)
Net cash outflow from
operating activities (287) (582) (941)
------------ ---------------- -------------
Cash flow from investing
activities:
Purchase of assets at
fair value through
profit and loss (148) (191) (343)
Sale of assets at fair
value through profit and
loss 163 219 344
Investment income - - 14
------------ ----------------
Net cash used in investing
activities 15 28 15
------------ ----------------
Cash flow from financing
activities:
Issue of shares - - 364
Issue of shares expenses - -
Net cash from financing
activities - - 364
------------ ---------------- -------------
Net increase in cash and cash
equivalents (272) (554) (562)
Cash and cash equivalents at
beginning of period 306 868 868
Cash and cash equivalents at
end of period- 34 314 306
NOTES TO THE FINANCIAL STATEMENTS
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 2010. 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
21September 2011. The information for the year ended 31 December
2010 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 2010
Six months Six months Year ended
to 30 June to 30 June 31 December
Earnings per 2011 2010 2010
2. share Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Loss for the
purpose of basic
and diluted loss
per share (85) (294) (970)
----------------- ----------------- -----------------
Number of
shares:
Weighted average
number of shares
in issue during
the year 631,794,869 499,067,599 508,158,508
Effect of
outstanding
options - - -
----------------- ----------------- -----------------
Adjusted weighted
average number of
shares 631,794,869 499,067,599 508,158,508
----------------- ----------------- -----------------
Basic and diluted
loss per share
from continuing
and total
operations (0.01)p (0.06)p (0.19)p
----------------- ----------------- -----------------
3. Post baPost balance sheet events
On 29 July 2011 the Company placed 110,750,000 new ordinary
shares in the Company of 0.1 pence each ("New Ordinary Shares") at
a price of 0.2 pence per New Ordinary Share raising GBP221,500. The
placing proceeds will provide additional working capital to the
Company to enable it to pursue its growth strategies. Certain of
the Directors participated in the Placing, the result of which is
that their participation is deemed to be a related party
transaction pursuant to AIM Rule 13.
4. Post SeSegmental Reporting
Business Segments
Adoption of IFRS, Operating Segments
The Group adopted "IFRS 8 - 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.
Institutional Equities
The institutional equities team raises money for corporate
clients and provides execution services to institutional and high
net worth clients.
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
Private
6 Months to Corporate Institutional Client
30 Jun 2011 Finance Sales Sales Unallocated Total
--------------- ---------- -------------- --------- ------------ ----------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- ---------- -------------- --------- ------------ ----------
UK 563 48 824 0 1,435
--------------- ---------- -------------- --------- ------------ ----------
Overseas 60 14 0 74
--------------- ---------- -------------- --------- ------------ ----------
Total Revenue 623 62 824 0 1,509
--------------- ---------- -------------- --------- ------------ ----------
Private
6 Months to Corporate Institutional Client
30 Jun 2010 Finance Sales Sales Unallocated Total
--------------- ---------- -------------- --------- ------------ ----------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- ---------- -------------- --------- ------------ ----------
UK 325 111 758 14 1,208
--------------- ---------- -------------- --------- ------------ ----------
Overseas 116 45 81 242
--------------- ---------- -------------- --------- ------------ ----------
Total Revenue 441 156 839 14 1,450
--------------- ---------- -------------- --------- ------------ ----------
Private
12 Months to Corporate Institutional Client
31 Dec 2010 Finance Sales Sales Unallocated Total
--------------- ---------- -------------- --------- ------------ ----------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- ---------- -------------- --------- ------------ ----------
UK 298 175 1,546 20 2,039
--------------- ---------- -------------- --------- ------------ ----------
Overseas 322 19 172 513
--------------- ---------- -------------- --------- ------------ ----------
Total Revenue 620 194 1,718 20 2,552
--------------- ---------- -------------- --------- ------------ ----------
Revenue Analysis
Private
6 Months to Corporate Institutional Client
30 Jun 2011 Finance Sales Sales Unallocated Total
--------------- ---------- -------------- --------- ------------ ----------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- ---------- -------------- --------- ------------ ----------
Fees 399 62 706 - 1,167
--------------- ---------- -------------- --------- ------------ ----------
Commissions 119 - 118 - 237
--------------- ---------- -------------- --------- ------------ ----------
Securities 105 - - - 105
--------------- ---------- -------------- --------- ------------ ----------
Total Revenue 623 62 824 - 1,509
--------------- ---------- -------------- --------- ------------ ----------
Cost of sales (29) (11) (306) - (347)
--------------- ---------- -------------- --------- ------------ ----------
Gross profit 594 51 518 1,162
--------------- ---------- -------------- --------- ------------ ----------
Admin Expenses (286) (125) (621) (40) 1,072
--------------- ---------- -------------- --------- ------------ ----------
Operating
Profit/(loss) 308 (74) (103) (40) 90
--------------- ---------- -------------- --------- ------------ ----------
Investment
income (175) - (175)
--------------- ---------- -------------- --------- ------------ ----------
Finance costs
--------------- ---------- -------------- --------- ------------ ----------
(Loss) Profit
for the Year 133 (74) (103) (40) (85)
--------------- ---------- -------------- --------- ------------ ----------
Private
6 Months to Corporate Institutional Client
30 Jun 2010 Finance Sales Sales Unallocated Total
--------------- ---------- -------------- --------- ------------ ----------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- ---------- -------------- --------- ------------ ----------
Fees 441 14 455
--------------- ---------- -------------- --------- ------------ ----------
Commissions 156 621 777
--------------- ---------- -------------- --------- ------------ ----------
Securities 218 218
--------------- ---------- -------------- --------- ------------ ----------
Total Revenue 441 156 839 14 1,450
--------------- ---------- -------------- --------- ------------ ----------
Cost of sales (11) (15) (283) (2) (311)
--------------- ---------- -------------- --------- ------------ ----------
Gross profit 430 141 556 12 1,139
--------------- ---------- -------------- --------- ------------ ----------
Admin Expenses (516) (286) (476) (54) (1,332)
--------------- ---------- -------------- --------- ------------ ----------
Operating loss (86) (145) 80 (42) (193)
--------------- ---------- -------------- --------- ------------ ----------
Investment
income (97) (97)
--------------- ---------- -------------- --------- ------------ ----------
Finance costs (4) (4)
--------------- ---------- -------------- --------- ------------ ----------
(Loss) Profit
for the Year (86) (145) 80 (143) (294)
--------------- ---------- -------------- --------- ------------ ----------
Private
12 Months to Corporate Institutional Client
31 Dec 2010 Finance Sales Sales Research Total
--------------- ---------- -------------- ---------- --------- --------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- ---------- -------------- ---------- --------- --------
Fees 620 20 640
--------------- ---------- -------------- ---------- --------- --------
Commissions 194 1,298 1,492
--------------- ---------- -------------- ---------- --------- --------
Securities 420 420
--------------- ---------- -------------- ---------- --------- --------
Total Revenue 620 194 1,718 20 2,552
--------------- ---------- -------------- ---------- --------- --------
Cost of sales (55) (45) (451) (551)
--------------- ---------- -------------- ---------- --------- --------
Gross profit 565 149 1,267 20 2,001
--------------- ---------- -------------- ---------- --------- --------
Admin Expenses (950) (562) (1,188) (187) (2,887)
--------------- ---------- -------------- ---------- --------- --------
Exceptional
Expenses (52) (30) (64) (146)
--------------- ---------- -------------- ---------- --------- --------
Investment
income 88 (18) 70
--------------- ---------- -------------- ---------- --------- --------
Finance costs (8) (8)
--------------- ---------- -------------- ---------- --------- --------
(Loss) Profit
for the Year (349) (443) 15 (193) (970)
--------------- ---------- -------------- ---------- --------- --------
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. Post Related Party transactions
Ultimate controlling party
The Directors do not consider there to be a single ultimate
controlling party.
Management
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 June 31 Dec
2011 2010 2010
GBP'000 GBP'000 GBP'000
Short-term
employee benefits 155 148 311
155 148 311
============== ============== ============
Included in Directors' emoluments is an amount of GBP15,000
invoiced to the Company by a company controlled by Mr M Hicks.
During the period to 30 June 2011 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 director and a shareholder of Alexander
David Securities Group plc. The total income derived from trading
through Jarvis Investment Management PLC was GBP590,115.
Transactions are undertaken on a normal commercial basis. At the
period end there was a balance of GBP23,029 due from Jarvis
Investment Management plc.
6. 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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