TIDMCLKH
The Clarkson Hill Group Plc (the "Group")
Half-yearly report for the 6 months to 30 June 2010
HIGHLIGHTS
* Revenues increased 12% to GBP9.6 million (2009: GBP8.5 million).
* Gross profit increased by 8% to GBP1.78 million (2009: GBP1.65 million).
* EBITDA* increased to GBP123,173 (2009: GBP20,226)
* Operating efficiency improved to 17.3% (2009: 19.1%). Operating efficiency
is calculated as being the operating costs as a percentage of revenue
* Earnings before interest, tax, depreciation and amortisation.
CHAIRMAN'S STATEMENT
Trading Highlights Unaudited Unaudited
6 months to 6 months to
30 June 2010 30 June 2009
Revenue 9,605,204 8,558,381
Gross Profit 1,780,971 1,650,841
Net Operating Costs (1,657,798) (1,630,615)
EBITDA* 123,173 20,226
Exceptional reorganisation costs - (129,320)
Profit/(loss) before Tax 47,853 (178,479)
* Earnings before interest, tax, depreciation and amortisation.
Results
Turnover increased by 12% to GBP9.6 million (2009: GBP8.5 million). The group
EBITDA increased to GBP123,173 (2009: GBP20,226), reflecting the group's
improvement during the six month period. Operating efficiency improved to 17.3
% (2009: 19.1%).
The increase in turnover reflects an improvement in consumer confidence in the
first six months of the year. Whilst operating costs were 1.6% higher than 2009
the restructuring programmes begun last year have resulted in an overall
improvement in operating efficiency currently at 17.3% (2009: 19.1%).
Profit before taxation for the period was GBP47,853 (2009: Loss GBP178,479) which
demonstrates a significant turnround in the group's performance.
Move to Assets under Management
The group continues to increase its recurring revenue, by generating ongoing
trail income from existing client investments to reflect the ongoing advice
being given. Such recurring revenues currently represent over 20% of the half
years income.
This revenue stream continues to grow significantly.
Retail Distribution Review (RDR)
The group's advisers continue to pass the examinations leading up to the
necessary qualifications post 1 January 2013.
The company will continue to provide the necessary support and assistance to
ensure as many of the advisers who wish to continue do so.
Regulatory Capital
Further to the announcement made by the Company 23 July 2010 the Board remain
in discussions with the FSA about the regulatory capital requirement of the
Company, and are seeking a number of ways in which to resolve this issue in a
timely manner.
Outlook
Since June the group has continued to trade in line with the Board's
expectations.
RD Pritchard
29 September 2010
The Clarkson Hill Group Plc
Consolidated Statement of Comprehensive Income
Unaudited Interim Results to 30 June 2010
6 months to 6 months to year ended
30 June 2010 30 June 2009 31 December
Unaudited Unaudited 2009
Audited
GBP GBP GBP
Revenue 9,605,204 8,558,381 17,551,520
Cost of sales (7,824,233) (6,907,540) (14,300,750
Gross profit 1,780,971 1,650,841 3,250,770
Net operating expenses (1,657,798) (1,630,615) (3,282,269)
Earnings before interest, tax, 123,173 20,226 (31,499)
depreciation and exceptional
items
Depreciation (41,200) (36,300) (73,500)
Exceptional reorganisation costs - (129,320) (465,107)
Group operating (loss)/profit 81,973 (145,394) (570,106)
Finance revenues 14 1,699 1,962
Finance costs (34,134) (34,784) (68,555)
(Loss)/profit on ordinary 47,853 (178,479) (636,699)
activities before taxation
Tax on (loss)/profit on 0 0 (68,000)
ordinary activities
(Loss)/retained profit for the 47,853 (178,479) (704,699)
group
Basic earnings/(loss) per share 0.2p (0.7)p (2.6)p
There are no recognised gains or losses other than the profit or loss for the
above financial periods.
None of the group's activities were acquired or discontinued during the above
financial periods.
Consolidated Statement of Financial Position
Unaudited Interim Results at 30 June 2010
30 June 2010 30 June 2009 31 December
2009
Unaudited Unaudited
Audited
GBP GBP GBP
ASSETS
Non current assets
Intangible assets 120,055 120,055 120,055
Property, Plant & Equipment 100,300 156,021 133,733
Investments 7,000 7,000 7,000
Deferred Tax 435,919 503,919 435,919
663,274 786,995 696,707
Current Assets
Trade and other receivables 4,831,974 3,523,126 3,509,013
Cash and cash equivalents 108,706 455,993 277,658
4,940,680 3,979,119 3,786,671
Total assets 5,603,954 4,766,114 4,483,378
Current Liabilities
Trade and other payables 4,384,460 3,149,291 3,448,293
Short term borrowings 412,370 276,448 346,745
Current portion of long term 136,401 121,963 53,066
borrowings
Current taxes payable 152,857 107,178 81,928
5,086,088 3,654,880 3,930,032
Non-current Liabilities
Long term borrowings 375,000 530,000 458,333
Total liabilities 5,461,088 4,184,880 4,388,365
Net Assets 142,866 581,234 95,013
CAPITAL AND RESERVES
Called up share capital 591,005 579,154 591,005
Share premium account 2,205,159 2,177,011 2,205,159
Merger reserve (99,000) (99,000) (99,000)
Retained earnings (2,554,298) (2,075,931) (2,602,151)
Total Equity 142,866 581,234 95,013
The interim financial information was approved by the Board of Directors on 29
September 2010, and was signed on its behalf by R Pritchard Director.
Consolidated Statement of Cash Flows
Unaudited Interim Results to 30 June 2010
6 months 6 months year
ended ended ended
30 June 30 June 31
2010 2009 December
2009
Unaudited Unaudited
Audited
GBP GBP GBP
Cash flows from operating activities
Group Profit/(Loss) before taxation for the 47,853 (178,479) (636,699)
period
Depreciation 41,200 36,300 73,500
Net finance costs 34,120 33,085 66,593
Operating (loss)/profit before working 123,173 (109,094) (496,606)
capital changes
Decrease/(Increase) in trade and other (1,322,961) (333,769) (319,656)
receivables
Increase in trade and other payables 1,007,096 128,966 402,718
Cash generated from operations (192,692) (313,897) (413,544)
Finance costs paid (34,134) (34,784) (68,555)
Net cash outflow from operating activities (226,826) (348,681) (482,099)
Cash flows from investing activities
Purchase of property, plant and equipment (7,767) (38,343) (53,255)
Interest received 14 1,699 1,962
(7,753) (36,644) (51,293)
Cash flows from financing activities
Share issue / Forfeiture of shares - 190,000 229,999
Proceeds from (repayment of) long term - (4,444) (4,444)
borrowings
Movement in short term borrowings 65,627 69,122 (1,145)
65,627 254,678 224,410
Net (decrease)/increase in cash and cash (168,952) (130,647) (308,982)
equivalents
Cash and cash equivalents at the beginning of 277,658 586,640 586,640
the period
Cash and cash equivalents at the end of the 108,706 455,993 277,658
period
Consolidated Statement of Changes in Equity
Unaudited Interim Results to 30 June 2010
Share Share Merger Retained Total
capital premium reserve earnings equity
Balance at 1 January 2009 479,154 2,087,011 (99,000) (1,897,452) 569,713
Changes in equity for 2009
Share issue 111,851 118,148 - - 229,999
(Loss) for the period - - - (704,699) (704,699)
Balance at 31 December 2009 591,005 2,205,159 (99,000) (2,602,151) 95,013
carried forward
Changes in equity for 2010
Profit for the period - - - 47,853 47,853
Balance at 30 June 2010 591,005 2,205,159 (99,000) (2,554,298) 142,866
carried forward
Basis of preparation
The interim financial information has been prepared on the basis of the
accounting policies set out in the group accounts for the year ended 31
December 2009.
The interim financial information does not constitute statutory accounts within
the meaning of the Companies Act 2006. A copy of the statutory accounts for the
year ended 31 December 2009, which was prepared under International Accounting
Standards, has been filed with the Registrar of Companies. The auditors' report
on those accounts was unqualified.
Earnings/(loss) per share
The earnings per share is calculated on the profit attributable to ordinary
shareholders of GBP47,853 (6 months to 30 June 2009: loss GBP178,479, year ended 31
December 2009: loss GBP704,699) divided by 29,550,270 (6 months to 30 June 2009:
24,107,677, year ended 31 December 2009: 27,115,161) being the weighted average
number of ordinary shares in issue during the period.
During 2010 and 2009, the share warrants and options were antidilutive and
accordingly there is no dilution of loss per share. However, the share options
could potentially dilute basic earnings per share in the future.
Report and financial statements
Copies of the Interim Report for the 6 months ended 30 June 2010 will be sent
to shareholders shortly. Further copies will be available from the Company's
registered office at Alexandra House, Alexandra Road, Wisbech, Cambridgeshire
PE13 1HQ. The financial statements are also available on the Company's website
www.theclarksonhillgroup.co.uk.
Contact:
The Clarkson Hill Group Plc
Ron Pritchard, Director
Tel: 01945 585721
Nominated Adviser
Cairn Financial Advisers LLP
Liam Murray
Tel: 020 7148 7903
END
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