TIDMQYM
RNS Number : 3599Z
Quayle Munro Holdings PLC
15 March 2012
Quayle Munro Holdings PLC Interim Report 2011
for the six months ended 31 December 2011
Company registration number
SC 72014
Highlights
-- Creditable outcome in difficult market conditions.
-- Revenue GBP5.0m compared with GBP5.3m in 2010 on a like-for-like basis.
-- Loss after tax of GBP(0.5)m (2010: GBP(0.6m)).
-- Advised on a number of major transactions, including Virgin
Group on the acquisition of Northern Rock plc by Virgin Money.
-- Good current pipeline of work across the business.
-- Interim dividend of 11p per share has been declared (2010: 10p per share).
-- Net assets of GBP39.7m (2010: GBP38.8m).
-- Andrew Adams appointed Chief Executive of Quayle Munro
Holdings PLC. Andrew Tuckey to stand down as Executive Chairman at
the AGM remaining as a Senior Adviser.
Andrew Tuckey, Chairman, commented: "The business is well
capitalised and in a strong position to meet the current market
challenges. We are encouraged by the good pipeline of new business
and the strength of our dedicated team and we expect a satisfactory
result for the year."
For further information:
Andrew Tuckey, Chairman, Quayle Munro +44 (0)20 7907 4200
John Kiely/Gemma Froggatt, Smithfield: +44 (0)20 7360 4900
Sandy Fraser, N+1 Brewin +44 (0)131 529 0385
Chairman's Statement
This has not been an easy period for Quayle Munro, with the
Group having to contend with a subdued M&A market and generally
depressed economic conditions, particularly in Europe. Taking into
account the difficult environment in which we operate at present, I
regard the Group result for the half year as a creditable
outcome.
Results
The Group result was broadly in line with the first six months
of last year.
Revenues for the period were GBP5.0m compared with GBP5.3m for
the previous period, a decline of 6%.
The loss on ordinary activities after taxation for the period
was GBP(0.5)m (2010: GBP(0.6)m). The loss on ordinary activities
after taxation for the period is stated after GBP0.7m of long term
incentive scheme and deferred bonus costs (2010: GBP1.0m).
Basic loss per share was reduced to (11.2)p (2010: loss per
share of (14)p) with fully diluted loss per share of (10.3)p (2010:
loss per share of (13.6)p).
Advisory Business
A number of significant deals were closed during the period, the
most notable being the successful purchase by Virgin Money of
Northern Rock, a transaction on which Quayle Munro advised the
Virgin Group over a number of years. In the public market we
advised the Board of LMS Capital plc on the company's new
investment strategy and board composition and in the media sector
we advised on the sale of Doctors.net to M3, Inc., a publicly
listed company on the Tokyo stock exchange. Our energy and
infrastructure teams advised Barclays Infrastructure Funds on the
acquisition and financing of Wadlow, a 26MW wind farm near
Cambridge. We are working with a number of bidders for Non-Profit
Distributing infrastructure projects in Scotland and have
consolidated our leading position in the higher education sector
with a wide range of ongoing projects.
Three of our senior executives have recently left the Group, all
for different reasons; Stuart Roberts has taken up an appointment
as group finance director of the Robertson Group (a long standing
client), Andreas Wesemann has moved to work with former colleagues
and Rashmi Sinha is pursuing other business opportunities in the
retail sector. On the other hand we have hired some outstanding new
talent at all levels and we are busy in both London and
Edinburgh.
The M&A market remains difficult at present; however, the
talented team we have at Quayle Munro continues to provide high
quality advice and services to our clients and I believe we are
well placed to benefit from an improvement in market
conditions.
Investments
Morris Homes, in which we have a 22.96% shareholding, has traded
satisfactorily in the nine month period to 31 December 2011 with
sales turnover of GBP101m (2010: GBP82m) and operating profits of
GBP14m (2010: GBP11m). Reservations and visitors to the open sites
have been encouraging during the early weeks of the year.
Of our other smaller investments, AMG delivered an impressive
set of results for 2011 and we have increased the valuation of our
shareholding by GBP0.3m. Moneybarn (formerly Duncton) continued to
perform satisfactorily during 2011, although marginally behind
budget. Nevis Range has continued to broaden its product offering
but with the lack of snow so far this winter, may not match last
year's visitor numbers. Tayside Flow Technologies has recently
changed its name to Vascular Flow Technologies and has hired a new
Chief Executive with significant industry experience. Following the
successful raising of significant new debt and equity finance in
December 2011 the company is now in a position to move ahead with
its business plan.
There has been no change in the fair value of the investments
held other than AMG.
Net Assets and liquidity
The Group continues to maintain significant cash resources.
These are held on short term deposits with three major UK retail
banks. In the current difficult economic environment and in the
absence of new investment opportunities, we continue to believe
this is the most prudent strategy for the time being.
The Group balance sheet as at 31 December 2011 shows net assets
of GBP39.7m which is equivalent to 870p per share and this compares
with 908p as at 30 June 2011.
After payment of the proposed dividends set out below the Group
has cash resources of approximately GBP16m.
Dividend
The Directors propose an interim dividend of 11p per share
(2010: 10p per share) to be paid on 10 April 2012 to shareholders
on the register at the close of business on 23 March 2012.
Prospects
After two record years and taking account of current market
conditions and the difficulty in anticipating the timing of deal
completions, I think it is unlikely our revenues for the current
year will match those of last year. However, with a good pipeline
of new business and a strong and dedicated team in both our
offices, we expect a satisfactory result for the full year.
The Board considers that the principal risks and uncertainties
facing the Group are consistent with those disclosed in the Annual
Report and Accounts 2011 where a list of the risks and
uncertainties can be found on pages 14 and 15.
Board and Management Changes
The Board is pleased to announce the appointment of Andrew Adams
as Chief Executive of Quayle Munro Holdings PLC as of today's date.
Andrew has been with the Group since the acquisition of van
Tulleken in 2008 and he has made an outstanding contribution to the
Advisory Business over that period.
I have been Chief Executive since 2009 and Executive Chairman
since 2010. I intend to stand down from the Board at the AGM later
this year but will remain with the Group as a Senior Adviser. We
will now seek a new independent Non-Executive Chairman to take over
from me.
Andrew Tuckey
14 March 2012
Group statement of comprehensive income
For the six months ended 31 December 2011
Six months Six months Year
31 December 31 December 30 June
2011 2010 2011
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
-------------------------------------------- ------ ------------- ------------- ---------
Revenue 5,016 5,254 14,744
-------------------------------------------- ------ ------------- ------------- ---------
Administrative expenses (4,836) (4,597) (10,188)
Impairment of investments
held as available-for-sale - - (2,019)
Gain on sale of associate - - 167
Exceptional expenses 7 - (177) (202)
Other operating expenses (750) (1,100) (2,811)
-------------------------------------------- ------ ------------- ------------- ---------
(5,586) (5,874) (15,053)
-------------------------------------------- ------ ------------- ------------- ---------
Group operating loss (570) (620) (309)
-------------------------------------------- ------ ------------- ------------- ---------
Finance income 254 219 439
Other finance (costs)/income
- pensions (74) (95) 32
-------------------------------------------- ------ ------------- ------------- ---------
180 124 471
(Loss)/profit on ordinary
activities before tax (390) (496) 162
Tax expense (74) (116) (1,123)
-------------------------------------------- ------ ------------- ------------- ---------
Loss on ordinary activities
after tax (464) (612) (961)
-------------------------------------------- ------ ------------- ------------- ---------
Loss attributable to shareholders
of the Company (464) (612) (961)
Other comprehensive income
Gain on revaluation of available-for-sale
financial assets 300 229 368
Actuarial (loss)/gain on
defined benefit pension
scheme (631) 313 213
Total comprehensive loss
for the period (795) (70) (380)
-------------------------------------------- ------ ------------- ------------- ---------
Basic earnings per share 9 (11.2)p (14.0)p (23.2)p
-------------------------------------------- ------ ------------- ------------- ---------
Group statement of financial position
As at 31 December 2011
31 December 31 December 30 June
2011 2010 2011
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
-------------------------------- ------ ------------ ------------ ---------
Non-current assets
Property, plant and equipment 686 808 742
Intangible assets 5 11,630 11,630 11,630
Financial assets 6 10,370 9,930 10,070
Defined benefit pension
scheme surplus 156 596 785
22,842 22,964 23,227
-------------------------------- ------ ------------ ------------ ---------
Current assets
Trade and other receivables 3,186 3,672 5,571
Current tax asset 62 18 49
Cash and short-term deposits 16,171 14,286 17,494
-------------------------------- ------ ------------ ------------ ---------
19,419 17,976 23,114
-------------------------------- ------ ------------ ------------ ---------
Total assets 42,261 40,940 46,341
-------------------------------- ------ ------------ ------------ ---------
Current liabilities
Trade and other payables 1,585 1,867 4,137
Current tax liabilities 72 71 456
1,657 1,938 4,593
-------------------------------- ------ ------------ ------------ ---------
Non-current liabilities
Financial liabilities - 6 -
Long term creditors 859 181 260
Deferred tax liabilities 50 4 50
-------------------------------- ------ ------------ ------------ ---------
909 191 310
-------------------------------- ------ ------------ ------------ ---------
Total liabilities 2,566 2,129 4,903
-------------------------------- ------ ------------ ------------ ---------
Net assets 39,695 38,811 41,438
-------------------------------- ------ ------------ ------------ ---------
Capital and reserves
Equity share capital 11,145 11,144 11,145
Revaluation reserve 9,603 7,145 9,303
Other reserves 2,963 1,627 2,953
Retained earnings 15,984 18,895 18,037
Total equity 39,695 38,811 41,438
-------------------------------- ------ ------------ ------------ ---------
These interim financial statements were approved by the Board of
Directors and signed on their behalf by:
Andrew Tuckey
Chairman
14 March 2012
Group statement of changes in equity
For the six months ended 31 December 2011
Share Total
Equity Capital option Own Total equity
share Revaluation redemption Merger expense shares other Retained and
capital reserve reserve reserve reserve reserve reserves earnings reserves
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------- -------- ----------- ----------- -------- -------- -------- --------- --------- ---------
Balance at 30
June 2010
(audited) 9,277 6,916 155 1,229 2,080 (730) 2,734 24,179 43,106
Comprehensive
income
Loss for the period - - - - - - - (612) (612)
Gain on revaluation
of investments - 229 - - - - - - 229
Share-based
payments - - - - 832 - 832 - 832
Actuarial gain
on defined benefit
pension scheme - - - - - - - 312 312
Transactions with
owners
Issue of shares 1,867 - - - - - - - 1,867
Movement of shares
in Employee
Benefit Trust - - - - - (1,939) (1,939) - (1,939)
Equity dividends
paid - - - - - - - (4,984) (4,984)
------------------- -------- ----------- ----------- -------- -------- -------- --------- --------- ---------
Balance at 31
December 2010
(unaudited) 11,144 7,145 155 1,229 2,912 (2,669) 1,627 18,895 38,811
Comprehensive
income
Loss for the period - - - - - - - (349) (349)
Gain on revaluation
of investments - 139 - - - - - - 139
Re-classification
of previous
impairment - 2,019 - - - - - - 2,019
Share-based
payments - - - - 1,540 - 1,540 - 1,540
Actuarial loss
on defined benefit
pension scheme - - - - - - - (99) (99)
Transactions with
owners
Issue of shares 1 - - - - - - - 1
Movement of shares
in Employee
Benefit Trust - - - - - (214) (214) 29 (185)
Equity dividends
paid - - - - - - - (439) (439)
------------------- -------- ----------- ----------- -------- -------- -------- --------- --------- ---------
Balance at 30
June 2011
(audited) 11,145 9,303 155 1,229 4,452 (2,883) 2,953 18,037 41,438
Comprehensive
income
Loss for the period - - - - - - - (464) (464)
Gain on revaluation
of investments - 300 - - - - - - 300
Share-based
payments - - - - 342 - 342 - 342
Transfer between
reserves - - - - (312) - (312) - (312)
Actuarial loss
on defined benefit
pension scheme - - - - - - - (631) (631)
Transactions with
owners
Movement of shares
in Employee
Benefit Trust - - - - - (20) (20) - (20)
Equity dividends
paid - - - - - - - (958) (958)
------------------- -------- ----------- ----------- -------- -------- -------- --------- --------- ---------
Balance at 31
December 2011
(unaudited) 11,145 9,603 155 1,229 4,482 (2,903) 2,963 15,984 39,695
------------------- -------- ----------- ----------- -------- -------- -------- --------- --------- ---------
Group statement of cash flows
For the six months ended 31 December 2011
Six months Six months Year
31 December 31 December 30 June
2011 2010 2011
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------------------ ------------ ------------ --------
Operating activities
(Loss)/profit before tax (390) (496) 162
Adjustments to reconcile (loss)/profit
before tax
to net cash flow from operating
activities
Finance income (254) (219) (439)
Depreciation 76 87 180
Share-based payments 388 1,013 2,372
Losses/(gains) on disposal of
fixed assets 10 (5) (6)
Gains on disposals of financial
assets - - (167)
Impairment of financial assets - - 2,019
Movement in pensions (2) (6) (181)
Decrease/(increase) in assets 2,385 (1,373) (3,271)
(Decrease)/increase in liabilities (2,270) (1,964) 570
------------------------------------------ ------------ ------------ --------
Cash (absorbed by)/generated
from operations (57) (2,963) 1,239
Tax paid (461) (935) (1,545)
------------------------------------------ ------------ ------------ --------
Net cash flow from operating
activities (518) (3,898) (306)
------------------------------------------ ------------ ------------ --------
Investing activities
Finance income received 204 210 334
Proceeds from sales of available-for-sale
financial assets - - 167
Proceeds from sales of plant
and equipment 2 93 93
Payments to acquire plant and
equipment (33) (250) (278)
Payments to acquire available-for-sale
financial assets - (47) (47)
------------------------------------------ ------------ ------------ --------
Net cash flow from investing
activities 173 6 269
------------------------------------------ ------------ ------------ --------
Financing activities
Dividends paid to equity shareholders
of the parent (958) (4,984) (5,423)
Own shares purchased (20) (75) (283)
------------------------------------------ ------------ ------------ --------
Net cash flow from financing
activities (978) (5,059) (5,706)
------------------------------------------ ------------ ------------ --------
Decrease in cash and cash equivalents (1,323) (8,951) (5,743)
Cash and cash equivalents at
the beginning of the period 17,494 23,237 23,237
------------------------------------------ ------------ ------------ --------
Cash and cash equivalents at
the end of the period 16,171 14,286 17,494
------------------------------------------ ------------ ------------ --------
Notes
1. Basis of preparation
Quayle Munro Holdings PLC ("the Company") is registered in
Scotland. This interim report contains the condensed financial
information of the Company and its subsidiaries (together "the
Group") for the six month period ended 31 December 2011.
The annual consolidated financial statements are prepared in
accordance with all relevant International Financial Reporting
Standards ("IFRSs") adopted for use in the European Union. The
interim condensed financial information complies with the
requirements of IAS 34 "Interim Financial Reporting".
The Group has adopted the following new and amended IFRSs as of
1 July 2011.
New and amended standards and interpretations
International Accounting Standards (IAS Effective
/ IFRSs) date
IAS 1 Amendment 'Presenting Comprehensive 1 July
Income' 2011
IFRS 7 Amendment 'Transfers of Financial 1 July
Assets' 2011
IASB and IFRIC have issued the following standards and
interpretations with an effective date after the date on these
financial statements:
International Accounting Standards (IAS Effective
/ IFRSs) date
IAS 12 Amendment 'Income taxes' - on 1 January
deferred tax 2012
IAS 1 Amendment 'Financial statement 1 July
presentation' - regarding other 2012
comprehensive income
IFRS 9 'Financial instruments' - classification 1 January
and measurement 2015
IFRS 10 'Consolidated financial statements' 1 January
2013
IFRS 13 'Fair value measurement' 1 January
2013
IAS 27 'Separate financial statements' 1 January
(revised 2013
2011)
The adoption of these standards has had no material impact on
the interim financial information.
The Directors consider that seasonality does not affect the
business' results or operations.
The Group has considerable financial resources and no external
debt and the Directors therefore consider it appropriate to
continue to use the going concern basis of preparation.
2. Accounting policies
The accounting policies adopted in the preparation of the
interim consolidated financial statements are consistent with those
followed in the preparation of the Group's annual financial
statements for the year ended 30 June 2011.
Available-for-sale financial assets
If an available-for-sale asset is impaired, an amount comprising
the difference between its cost (net of any principal payment and
amortisation) and its fair value is transferred from equity to the
statement of comprehensive income. Reversals in respect of equity
instruments classified as available-for-sale are not recognised in
the statement of comprehensive income.
3. Segment information
Management has determined the operating segments based on the
reports reviewed by the executive management team and the Board
(the Chief Operating Decision Maker) that are used to make
strategic decisions. The Group is managed primarily by class of
business and presents the segmental analysis on that basis. The
Group's activities are organised in two primary divisions: Advisory
Business, and Other (Investment Management and Head Office).
The following tables present revenue, expenditure and certain
asset information regarding the Group's business segments for the
period ended 31 December 2011 and the period ended 31 December
2010.
Advisory Business Other Total
Period ended 31 December 2011 GBP'000 GBP'000 GBP'000
-------------------------------- ----------------- -------- --------
Revenue 5,016 - 5,016
Overheads (5,344) (242) (5,586)
----------------- -------- --------
Operating loss (328) (242) (570)
Finance income - 254 254
Finance costs - (74) (74)
----------------- -------- --------
Group loss before tax (328) (62) (390)
Total assets 4,028 38,233 42,261
Total liabilities (2,461) (105) (2,566)
-------------------------------- ----------------- -------- --------
Total assets includes:
Additions to non-current assets 33 - 33
Period ended 31 December 2010
-------------------------------- ----------------- -------- --------
Revenue 5,254 - 5,254
Overheads (5,685) (189) (5,874)
----------------- -------- --------
Operating loss (431) (189) (620)
Finance income - 219 219
Finance costs - (95) (95)
----------------- -------- --------
Group loss before tax (431) (65) (496)
Total assets 5,441 35,499 40,940
Total liabilities (2,023) (106) (2,129)
-------------------------------- ----------------- -------- --------
Total assets includes:
Additions to non-current assets 250 47 297
4. Principal financial risks
Interest rate risk
The Group's cash balances are held in accounts that bear
interest directly related to the bank base rate.
Credit risk
There are no significant concentrations of credit risk within
the Group. The Group has established procedures to minimise the
risk of default by trade receivables including detailed client
adoption checks. Historically, these procedures have proved
effective in minimising the level of impaired and past due
receivables.
Liquidity risk
Liquidity risk reflects the risk that the Group will have
insufficient resources to meet its financial obligations as they
fall due. The Group's strategy to managing liquidity risk is to
ensure that the Group has sufficient liquid funds to meet all its
potential liabilities as they fall due, including anticipated
shareholder distributions. Risk is mitigated by maintaining
significant cash balances. The Group did not carry any borrowings
at 31 December 2011.
Equity price risk
The Group holds a portfolio of unlisted investments. The value
of the unlisted investment portfolio could decrease as well as
increase.
5. Intangible assets
Intangible assets relate to goodwill arising on the acquisition
of New Boathouse Capital Limited in 2007 and The van Tulleken
Company Limited in 2008. Goodwill is assessed annually for
impairment.
6. Financial assets
Available-for-sale financial assets consist of investments in
ordinary shares and loan stock which have no fixed maturity
date.
7. Exceptional expenses
Exceptional expenses incurred during the prior year totalled
GBP0.2m. These included redundancy costs of GBP0.1m and the buyback
cost of options of GBP0.1m.
8. Dividends paid and proposed
The interim dividend of 11p per share (2010: 10p per share) will
be paid on 10 April 2012 to members on the register at 23 March
2012 and will absorb GBP0.5m of shareholders' funds.
The final dividend in relation to the year ended 30 June 2011 of
22p per share was paid in the period. This absorbed GBP1m of
shareholders' funds.
9. Key performance indicators
Earnings per share
The calculation of basic loss per share for the six months to 31
December 2011 is based on losses after tax of GBP(0.5)m (2010 -
losses GBP(0.6)m) and on 4.1m ordinary shares, being the weighted
average number of shares in issue during the period (2010 -
4.4m).
The calculation of fully diluted loss per share is based on the
weighted average of 4.5m ordinary shares (2010 - 4.5m) and the
average share price during the period.
Net assets per share
The net assets per share are based on 4.6m ordinary shares in
issue as at 31 December 2011 (30 June 2011 - 4.6m, 31 December 2010
- 4.6m).
10. Financial information
The financial information contained in this interim statement
does not constitute statutory accounts as defined in section 434 of
The Companies Act 2006.
The results for the six months ended 31 December 2011 and 31
December 2010 are unaudited; however a review opinion made under
ISRE 2410 has been issued by PricewaterhouseCoopers LLP. Our
auditors, PricewaterhouseCoopers LLP, have audited the annual
financial statements for the year ended 30 June 2011 and their
report was unqualified and did not contain a statement under
section 498(2) or 498(3) of the Companies Act 2006. The Group's
consolidated statutory accounts for the year ended 30 June 2011
have been filed with the Registrar of Companies.
11. Shareholder information
This report will be circulated to all shareholders, and copies
will be available from the Company Secretary at 102 West Port,
Edinburgh EH3 9DN.
Independent review report
To the members of Quayle Munro Holdings PLC
Introduction
We have been engaged by the company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 31 December 2011, which comprises the Group
statement of comprehensive income, the Group statement of financial
position, the Group statement of changes in equity, the Group
statement of cash flows and related notes. We have read the other
information contained in the half-yearly financial report and
considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set
of financial statements.
Directors' responsibilities
The half-yearly financial report 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 AIM Rules for Companies which require that the financial
information must be presented and prepared in a form consistent
with that which will be adopted in the company's annual financial
statements.
As disclosed in note 1, the annual financial statements of the
Group are prepared in accordance with IFRSs as adopted by the
European Union. 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", as adopted by the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review. This report, including the
conclusion, has been prepared for and only for the company for the
purpose of the AIM Rules for Companies and for no other purpose. We
do not, in producing this report, accept or assume responsibility
for any other purpose or to any other person to whom this report is
shown or into whose hands it may come save where expressly agreed
by our prior consent in writing.
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 of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on 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 31
December 2011 is not prepared, in all material respects, in
accordance with International Accounting Standard 34 as adopted by
the European Union and the AIM Rules for Companies.
PricewaterhouseCoopers LLP
Chartered Accountants
Edinburgh
14 March 2012
This information is provided by RNS
The company news service from the London Stock Exchange
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