TIDMSGR
RNS Number : 5093T
Shore Capital Group Limited
21 March 2019
Shore Capital Group Limited
("Shore Capital", the "Group", or the "Company")
Preliminary Results for the Year Ended 31 December 2018
Shore Capital, the independent investment group specialising in
capital markets, asset management and principal finance, today
announces its preliminary results for the year ended 31 December
2018.
Financial highlights
2018 2017 Change
(GBP m) (GBP m) (%)
----------------------------------- --------- --------- -------
Group revenue 43.3 41.9 3.4
Profit before tax 4.1 4.6 (11.1)
Basic earnings per share 12.6p 13.1p (3.8)
Final proposed dividend per share 5.0p 5.0p -
Total dividends for the year (per
share) 10.0p 10.0p -
Operational highlights
-- Increased revenues have allowed further investment in both
Capital Markets and Asset Management divisions, positioning us to
capture market share as global banks retrench and benefit further
when sentiment improves
-- Acquisition of Stockdale Securities after the year end will
create London's fourth largest adviser to quoted businesses,
expected to complete on 31 March 2019
-- Agreement of a GBP200 million institutional funding line for
Puma's property finance operation with funds advised by RoundShield
Partners LLP, a significant endorsement of the Group's Asset
Management business
-- DBD's 32 regional radio spectrum licences have been
reallocated to the 3.700-3.730 GHz frequency band on a flexibilised
basis, enabling their use for modern 4G and 5G services
Commenting on the results, Howard Shore, Chairman, said:
"We have continued to grow revenues whilst making targeted
investments across our main operating divisions. This
counter-cyclical strategy positions us to capture market share,
further establishing our credentials as a significant presence in
UK financial services.
"The Stockdale acquisition is evidence of our appetite for
investment and will elevate our Capital Markets division to
London's fourth largest adviser to quoted businesses. Similarly, in
Asset Management we have secured a GBP200 million institutional
funding line for our property finance business.
"Whilst not immune to uncertainty in capital markets, we are
excited by recent developments in all divisions - Capital Markets,
Asset Management and Principal Finance - and are therefore
optimistic about the prospects of our diversified business
model."
- Ends -
Enquiries:
Shore Capital
Howard Shore, Executive Chairman +44 (0) 20 7468 4050
Simon Fine, Co-Chief Executive
David Kaye, Co-Chief Executive
Lynn Bruce, Director +44 (0) 14 8172 8902
Grant Thornton UK LLP (Nominated
Adviser)
Philip Secrett
Jamie Barklem
Ben Roberts +44 (0) 20 7383 5100
Montfort Communications (Public
Relations)
Olly Scott +44 (0) 78 1234 5205
The information contained within this announcement is deemed to
constitute inside information under the Market Abuse Regulations
(EU) No. 596/2014.
About Shore Capital
Shore Capital is an AIM quoted independent investment group.
Founded and majority owned by entrepreneurs, for three decades
Shore Capital has been helping entrepreneurial businesses reach
their full potential, find committed long-term investors and
develop into significant enterprises. The business offers
innovative corporate advice; a leading market making business; some
of the most respected investment research available in the UK; and
a diverse range of high quality investment opportunities, including
its hugely successful VCTs and principal finance activities.
The Group is based in Guernsey, London, Liverpool, Edinburgh and
Berlin. Shore Capital Stockbrokers Limited, Shore Capital and
Corporate Limited, Shore Capital Limited and Puma Investment
Management Limited are each authorised and regulated by the
Financial Conduct Authority. Shore Capital Stockbrokers Limited is
a member of the London Stock Exchange.
www.shorecap.gg
Chairman's statement
Introduction
During 2018, the Group continued to grow revenues, allowing for
further investment in both of the Group's main operating divisions
and positioning us to capture market share as sentiment improves.
As global investment banks and mainstream providers continue to
retreat from the UK market, the targeted investments we have made
will enable us to grow the strength and size of our financial
services franchise.
Group revenue for the year increased by 3.4% to GBP43.3 million
(2017: GBP41.9 million), whilst profit before tax decreased by
11.1% to GBP4.1 million (2017: GBP4.6 million), driven by an 8.4%
increase in administrative expenses to GBP38.9 million (2017:
GBP35.9 million), reflecting our investment in the business. Basic
earnings per share were marginally lower at 12.6p (2017:
13.1p).
The most important development in the Capital Markets division
came after the year end with the acquisition of Stockdale
Securities Limited, which is expected to complete on 31 March 2019.
The acquisition will create London's fourth largest adviser to
quoted businesses, unlocking exciting new opportunities.
Stockdale's clients and expertise complement and enhance our
existing activities and the combined business will have a quality,
strength and scale which we believe clients and investors will find
compelling.
During the year, the Capital Markets division grew income from
corporate mandates and transactions and continued to add to its
high-quality retained client base. The business has performed
robustly through the year, developing its integrated offering and
maintaining high levels of market activity. New retained clients
included a further FTSE 100, Marks and Spencer Group Plc, and FTSE
250 Sirius Minerals plc. The team advised on five new admissions,
18 secondary fundraisings and three public takeovers, including the
reverse takeover and acquisition of a majority interest in Welcome
Break by Applegreen plc, raising EUR175 million; and the GBP198
million placing of stock in FTSE 100 GVC Holdings plc on behalf of
Playtech plc.
We have continued to build our equity research coverage,
underscoring our strong sector credentials, focusing primarily on
growth companies in the UK & Ireland and expanding into the
Industrials sector. In addition, we developed our response to the
cross-sector impact of evolving digital technologies, with new
coverage of technology, digital media, online retailing and
disruptive innovations.
Our Market Making activities were impacted by tough trading
conditions in the fourth quarter of 2018, but nevertheless remained
profitable throughout the period. Overall the Market Making
business achieved a solid, profitable performance for the year,
albeit on lower revenues. The continued strength and reputation of
this business is driven by its strong management and expert team,
demonstrating that even in difficult conditions it is able to
deliver profits whilst carefully managing risk.
In Asset Management we maintained the momentum achieved in
previous years, developing exciting new opportunities for investors
to grow revenues, profits and assets under management, with overall
AUM growing 6.4% to GBP920 million.
Puma Investments has developed its platform focus on private
equity, property finance and listed equities. Earlier investments
in new expertise and distribution capabilities have enabled the
business to anticipate changing market conditions and attract a
significant institutional partner. In the fourth quarter of 2018
the division secured a GBP200 million funding line for its property
finance business from RoundShield Partners LLP ("RoundShield"), a
European private equity house.
Puma Private Equity continued to attract retail investment
funds, with the latest Puma VCT 13 closing early due to high
demand. It has now deployed over 30% of its capital. Our EIS
service, Puma Alpha, has attracted over GBP70 million.
Puma Property Finance gained significant ground during the year
following its agreement with funds advised by RoundShield to
provide GBP200 million for new finance opportunities. Alongside
this institutional money, the diversified Puma Heritage property
finance business continued to attract funds, growing to
approximately GBP75 million during the year from a combination of
lending returns and additional subscriptions.
In Listed Equities, the Puma AIM IHT Service was Highly
Commended at the 2018/19 Investment Week Tax Efficiency Awards.
Assets under management, reached GBP24 million during the year,
driven by its availability on the Ascentric, Standard Life and
Transact platforms.
During the year we also acquired a majority stake in a company
investing in property in the social care sector. We have an
exciting pipeline of opportunities in this space and are optimistic
about prospects for further revenues from this sector.
In the Institutional asset management business, the Group has
continued to assist Brandenburg Realty and Puma Brandenburg to
implement their strategies. The Group has supported initiatives to
renovate and generate income from assets, transact commercial and
residential properties and strengthen relationships with
tenants.
Given our recent expansion and together with the Stockdale
acquisition, it became clear that we required new premises for our
London operations. We recently entered into a lease for new offices
at Cassini House, St James's Street, taking the fourth and fifth
floors comprising 13,700 sq ft. This will both accommodate current
and future expansion plans and we believe enable a more modern and
flexible work environment.
With respect to DBD, it has now been concluded that the 32
German regional radio spectrum licences that DBD holds shall be
reallocated from the 3.5 GHz frequency band to the 3.700-3.730 GHz
frequency band at no cost, on a "flexibilised" basis, meaning
without historic technical restrictions limiting their usage, and
continue to be for perpetual duration. The flexibilisation will
enable their use for modern services such as 4G and 5G. We are
confident of the future prospects for DBD's business and the value
that can accrete from it.
Financial review
Income and expenditure
Revenue for the year increased by 3.4% to GBP43.3 million (2017:
GBP41.9 million), whilst administrative expenses increased by 8.4%
to GBP38.9 million (2017: GBP35.9 million). Group profit before tax
decreased by 11.1% to GBP4.1 million (2017: GBP4.6 million).
Revenue from Capital Markets decreased by 6.5% to GBP25.5
million (2017: GBP27.2 million) and divisional profit before tax
declined 21.9% to GBP4.1 million (2017: GBP5.2 million) with a net
margin of 15.9% (2017: 19.1%).
Revenue from Asset Management grew by 22.8% to GBP15.8 million
(2017: GBP12.9 million) and divisional profit before tax increased
5.5% to GBP3.2 million (2017: GBP3.0 million) generating a net
margin of 20.0% (2017: 23.3%).
The Principal Finance division recorded a pre-tax loss of GBP1.5
million (2017: GBP2.0 million loss).
Basic Earnings per Share
The Group generated earnings per share of 12.6p (2017:
13.1p).
Liquidity
The Group maintained a strong liquidity position enabling it to
undertake a range of transactions as opportunities arise in the
near term. As at the balance sheet date, available liquidity was
GBP33.8 million, comprising cash of GBP31.0 million (2017: GBP35.7
million) and GBP2.8 million of gilts and bonds (2017: GBP8.8
million). The Group also had a GBP20 million working capital
facility which was unused at the year end.
Balance sheet
The Group's balance sheet remains strong. Total equity at the
year end was GBP68.1 million (2017: GBP67.2 million) reflecting the
profit generated in the year, offset by dividends paid.
In addition to the GBP31.0 million of cash and GBP2.8 million of
gilts and bonds referred to above, GBP6.8 million was held in funds
advised by the Group; GBP3.6 million net in quoted equities and a
further GBP1.3 million in other unquoted holdings. The licences
held as part of the Group's Spectrum Investments were carried at a
cost of GBP2.3 million on a gross basis, before allowing for
minority interests.
The remainder of the balance sheet was GBP20.3 million net,
which included GBP11.9 million of net market and other debtors in
the Company's stockbroking subsidiary.
Net Asset Value per Share
Net asset value per share at the year end was 269.4p (2017:
270.0p).
Dividend
The Board proposes a final dividend of 5.0p per share (2017:
5.0p) making a total for the year of 10.0p per share (2017: 10.0p).
The dividend will be paid on Wednesday 24 April 2019 to
shareholders on the register as at Friday 5 April 2019.
Operating review
Capital Markets
Overview
During the year the Capital Markets business has proved robust
in an environment characterised by substantial political
uncertainty and significant global economic headwinds.
Revenues were 6.5% lower than the prior year, predominantly
resulting from difficult market conditions in the final quarter of
2018. In that context, it has been enormously encouraging that
income from corporate mandates and transactions has grown
year-on-year, reflecting our sustained investment in the business.
We also grew the retained client base, a particular highlight being
the addition of our second FTSE 100 broking client, Marks and
Spencer Group Plc.
We have worked carefully to ensure that the business is
well-positioned to take advantage of market opportunities. As such,
after the year end in February 2019, we were delighted to announce
the acquisition of Stockdale Securities Limited, which is expected
to complete on 31 March 2019. The combination of the two businesses
is compelling in that it unites complementary businesses and
enhances our existing operations, adding scale, expertise and
diversity to the Capital Markets division.
Corporate Broking and Advisory
During 2018, we have continued to be very active and advised on
five admissions consisting of two IPOs and three reverse takeovers.
In the year under review Shore Capital undertook 18 secondary
fundraisings and advised on three public takeovers. Significant
transactions during the year included acting as:
-- Nominated Adviser, global co-ordinator and joint bookrunner
on the reverse takeover and acquisition of a majority interest in
Welcome Break by Applegreen plc, raising EUR175 million;
-- Nominated Adviser sole bookrunner and broker on the IPO of
Nucleus Financial Group plc, raising GBP32.1 million;
-- Joint bookrunner on the GBP198 million placing of stock in
FTSE 100 GVC Holdings plc on behalf of Playtech plc;
-- Joint bookrunner on the GBP70 million placing by FTSE 250
Dairy Crest Group plc;
-- Nominated Adviser and joint bookrunner the acquisition of
Inprova Finance Limited by Inspired Energy plc, raising GBP19.0
million;
-- Joint bookrunner on the GBP22.5 million placing by Motorpoint
Group plc; and
-- Lead Manager on the placing and re-admission to AIM of
Savannah Petroleum plc, following its acquisition of certain assets
from Seven Energy International Limited, raising US$125
million.
Our advisory work included acting as:
-- Financial and Rule 3 adviser to Produce Investments plc in
relation to its GBP55.3 million takeover by Promethean Investments
LLP;
-- Financial and Rule 3 adviser to Zenith Hygiene Group plc in
relation to its GBP100 million takeover by Bain Capital; and
-- Financial and Rule 3 adviser to Styles & Wood Group Plc
in relation to its GBP42.5 million takeover by Central Square
Holdings Limited.
During the year we added nine new clients including a further
FTSE 100 mandate in the form of Marks and Spencer Group Plc, as
well as FTSE 250 Sirius Minerals plc.
Research, Idea Generation and Distribution
Through the first year of the MiFID II Directive's
implementation, Shore Capital's research and distribution teams
remained focused upon producing high-quality independent and issuer
sponsored equity research and idea generation, and maintaining high
levels of interaction with the market. MiFID II has created
significant upheaval and uncertainty for all market participants,
changing the way that the industry operates. Notwithstanding this,
we are very pleased to have had extensive engagement with the
investment community over the year.
We have continued to build our equity research coverage,
underscoring our strong sector credentials, focusing primarily on
growth companies in the UK & Ireland, with notable additions in
the Industrials sector in particular. In addition, we developed our
response to the cross-sector impact of evolving digital
technologies, with new coverage of technology, digital media,
online retailing and disruptive innovations.
Market Making
Our Market Making activities were impacted by tough trading
conditions in the fourth quarter of 2018, but nevertheless remained
profitable during this period. Overall the Market Making business
achieved a solid, profitable performance for the year, albeit on
lower revenues. The continued strength and reputation of our
business is driven by its strong management and expert team,
demonstrating that even in difficult conditions it is able to
deliver profits whilst carefully managing risk.
Although clearly sensitive to the macroeconomic environment, we
remain focused and adaptable to changing trading conditions and
client needs.
Asset Management
Overview
The Asset Management division continued to make significant
progress during the year, growing revenues, profits and assets
under management. Overall AUM at the year end grew 6.4% to GBP920
million, (2017: GBP865 million) driven by fundraising in the Puma
Investments operations and increased valuations in our
institutional portfolios.
Puma Investments
Overview
Puma Investments, our UK fund management business, enjoyed a
strong year in which revenues grew substantially, allowing for
further investment into its three focus areas of private equity;
property finance; and listed equities. In recent years we have
steadily invested in new resources and expertise for the business,
resulting in significant growth. The momentum maintained over the
past two years combined with the operational capacity in the
business means that we are ideally positioned to take advantage of
the opportunities ahead and continue growing the business.
Our potential was endorsed towards the end of 2018 with the
agreement of a GBP200 million institutional funding line for our
property finance business.
Puma Private Equity
Puma Private Equity offers retail investors access to tax
efficient private equity strategies through our long-standing
Venture Capital Trusts ("VCTs") and Enterprise Investment Scheme
("EIS") offerings. We are sector-agnostic and seek to back
well-positioned businesses led by high-quality, credible management
teams who have the potential and aspiration to deliver material
growth.
Since 2005, the Group has raised nearly GBP240 million for its
Puma VCTs and returned over GBP140 million in dividends to
investors. Its latest offer, Puma VCT 13, recently closed early due
to high demand. At the time of writing, Puma VCT 13 had deployed
over 30% of its funds into qualifying companies.
The Puma Alpha EIS service, ("Puma Alpha") launched in October
2017 and is run by the same experienced team responsible for the
Puma VCTs, benefiting from their strong track record and expertise.
Fundraising continued successfully throughout the year, increasing
funds in Puma Alpha, together with its predecessor Puma EIS, to
over GBP75 million at the time of writing. Puma Alpha has now made
five investments, growing the suite of EIS companies in both
services to 15.
Puma Property Finance
Puma Property Finance offers investors access to secured, first
charge loans, on UK real estate across a range of sectors. The
platform provides lending solutions to professional borrowers
throughout the lifecycle of property development, via three
principal offerings: pre-development bridge loans; development
finance; and development exit loans. Transaction sizes typically
range from GBP3 million to GBP30 million and the team is active
across residential, commercial and more specialist areas of real
estate, including hotels, student accommodation and healthcare.
For a number of years, Private Client investors have been able
to access these activities through an investment into Puma Heritage
plc, which utilises its diversified loan book, (totalling over 450
loans to date) to generate regular returns for shareholders
intended to counter long-term inflationary pressures. An investment
in Puma Heritage is intended to benefit from 100% relief from
Inheritance Tax after two years.
The net asset value of Puma Heritage has grown to over GBP75
million at the time of writing from a combination of lending
returns and additional subscriptions. Puma Heritage remains open
for investment and has a strong pipeline of loan opportunities to
drive future growth.
During the year, we were delighted to agree an institutional
funding line of up to GBP200 million from funds advised by
RoundShield Partners LLP and affiliates ("RoundShield") for
deployment in our Puma Property Finance business. The RoundShield
deal signifies the institutional quality of our real estate
activities and enables us to engage with the high level of demand
we face for competitively priced development finance as well as
investing in our infrastructure and high-quality, experienced
lending team.
Listed Equities
The business offers retail investors access to a discretionary
equity portfolio service through its Puma AIM IHT Service, (the
"AIM Service") which seeks to mitigate Inheritance Tax by investing
in a carefully selected portfolio of AIM shares. The AIM Service is
particularly attractive for those that wish to utilise these tax
advantages whilst also investing within their ISA wrapper. The
service has now been running for over four years and has won many
awards, most recently being Highly Commended at 2018/19s Investment
Week Tax Efficiency Awards.
Despite tough equity markets over the course of 2018, the
service continued to grow assets under management, reaching GBP24
million by December 2018. A significant proportion of our growth
was generated as a result of our availability on the Ascentric,
Standard Life and Transact platforms. Having grown the team, we now
have the capacity to increase the number of platforms through which
we can provide our service and aim to add more platform providers
during 2019.
Social Care
The business has enjoyed strong revenue generation from its
activities in the social care sector, leveraging our many years of
experience providing development funding in this area. Our broad
range of relationships has enabled us to partner with external
funds investing in the supported living sector, where we are
providing a holistic service to source, structure and negotiate
acquisitions.
During the year, we also invested GBP800,000 to acquire a
majority stake in a company investing in property in the social
care sector. We have an exciting pipeline of opportunities and are
optimistic about prospects for further revenues from this
sector.
Institutional Asset Management
Brandenburg Realty
Brandenburg Realty (the "Fund") continues to seek a range of
high-quality real estate opportunities and implement its asset
management programme to enhance value creation across the
portfolio.
During the year, the Fund took possession of the three Mitte and
Prenzlauer Berg assets purchased in December 2017. Since then, the
first stage of obtaining condominium title has been completed for
each building. Renovation works have been planned and the first
furnished apartments have been let. In December 2018 two further
assets were notarised with completion expected in the second
quarter of 2019.
The team also continues to assist the Fund's implementation of
its strategy for the other commercial and residential assets. At
the Potsdam assets, a full planning permission to construct c.1,800
sq.m. of new residential space was been secured and both plots were
sold to a third party developer at a significant gain. Vacant units
in the existing Potsdam residential assets are being renovated and
let as furnished apartments. Meanwhile, units in Berlin's
Monumentenstrasse continue to be sold at more favourable prices
than the underwriting expectations at the time of acquisition.
During the year the team secured debt financing with DKB for a
portfolio of four assets including the three Mitte and Prenzlauer
Berg assets.
The team continues to assist Mixer Global to identify and
evaluate new co-working sites, especially in Germany and the US.
During the year, Mixer entered into a lease to open its third site
in Israel where construction works are underway, and a fourth site
in the centre of Tel Aviv where heads of terms have been
agreed.
Puma Brandenburg Limited ("PBL")
During the year, the Group has continued to assist PBL to
execute its strategy, including:
-- The completion of two new restaurant pavilions at Cologne's
Hyatt Regency hotel;
-- The conversion of further apartments to add to PBL's pool of
furnished apartments that are let out on short term leases; and
-- PBL's participation in the Mixer Global investment, as noted
above.
St Peter Port Capital ("SPPC")
SPPC announced its results for the half year ended 30 September
2018 on 8 November 2018. As at that date, it had investments in six
companies, (excluding companies in the portfolio it had written
down to zero).
SPPC realised one small investment which had recently listed on
a Canadian stock exchange, generating GBP96,000 during the
year.
Principal Finance
The Principal Finance division seeks to use the Group's balance
sheet to invest in attractive opportunities and seed new funds.
Investment in DBD
Shore Capital holds a 59.94% interest in Spectrum Investments
Limited, the parent company of DBD. DBD, through a subsidiary, has
held 32 regional radio spectrum licences in Germany of perpetual
duration (the "Licences").
Following previous updates in respect of communications with the
German Telecoms Regulator ("BNetzA"), it has now been concluded
that the Licences shall be reallocated from the 3.5 GHz frequency
band to the 3.700-3.730 GHz frequency band at no cost. The licences
will continue to be for perpetual duration, on a "flexibilised"
basis, meaning without historic technical restrictions limiting
their usage. The flexibilisation will enable their use for modern
services such as 4G and 5G.
We are therefore confident of the future prospects for DBD's
business and the value that can accrete from it.
New offices
Since the year end, the Group has entered into a lease for new
offices at Cassini House, St James's Street, London, taking the
fourth and fifth floors comprising 13,700 sq ft. This will both
accommodate current and future expansion plans and we believe
enable a more modern and flexible work environment. The move is
anticipated for June 2019 and associated one-off costs are expected
to be circa GBP500,000.
Current Trading and Prospects
Whilst not immune to uncertainty in capital markets, we are
excited by recent developments in all divisions - Capital Markets,
Asset Management and Principal Finance - and are therefore
optimistic about the prospects of our diversified business
model.
Howard Shore
Chairman
21 March 2019
Unaudited Consolidated Income Statement
For the year ended 31 December 2018
Notes 2018 2017
GBP'000 GBP'000
-------------------------------- ------ --------- ---------
Revenue 2 43,334 41,896
Administrative expenditure (38,929) (35,906)
Balance sheet impairments - (1,883)
Share of results of associates - 805
Operating profit 4,405 4,912
--------- ---------
Interest income 43 95
Finance costs (380) (430)
--------- ---------
(337) (335)
Profit before taxation 2 4,068 4,577
--------- ---------
Taxation (485) (912)
Profit for the year 3,583 3,665
========= =========
Attributable to:
Equity holders of the parent 2,727 2,826
Non-controlling interests 856 839
3,583 3,665
========= =========
Earnings per share
Basic 4 12.6p 13.1p
Diluted 4 12.5p 12.8p
Unaudited Consolidated Statement of Comprehensive Income
For the year ended 31 December 2018
2018 2017
GBP'000 GBP'000
----------------------------------------------- -------- --------
Profit after tax for the year 3,583 3,665
-------- --------
Items that may be reclassified to the income
statement
Losses on revaluation of available-for-sale
investments - (14)
(Losses)/gains on cash flow hedges (201) 105
Tax thereon 38 (20)
-------- --------
(163) 71
Exchange difference on translation of foreign
operations 299 516
-------- --------
Other comprehensive income for the year,
net of tax 136 587
-------- --------
Total comprehensive income for the year,
net of tax 3,719 4,252
======== ========
Attributable to:
Equity holders of the parent 2,785 3,260
Non-controlling interests 934 992
3,719 4,252
======== ========
Unaudited Consolidated Statement of Financial Position
As at 31 December 2018
Notes 2018 2017
GBP'000 GBP'000
------------------------------------------ ------ --------- ---------
Non-current assets
Goodwill 381 381
Intangible assets 2,263 2,229
Property, plant & equipment 7,653 7,699
Investment properties 2,643 -
Principal Finance Investments 5,357 6,475
Deferred tax asset 108 149
18,405 16,933
--------- ---------
Current assets
Trading assets 9,837 8,154
Trade and other receivables 42,058 52,767
Derivative financial instruments - 32
Cash and cash equivalents 31,015 35,673
--------- ---------
82,910 96,626
--------- ---------
Total assets 2 101,315 113,559
--------- ---------
Current liabilities
Trading liabilities (708) (1,017)
Trade and other payables (27,877) (34,602)
Derivative financial instruments (135) (12)
Tax liabilities (165) (966)
Borrowings (4,299) (9,726)
(33,184) (46,323)
--------- ---------
Non-current liabilities
Provision for liabilities and charges (68) (66)
--------- ---------
(68) (66)
--------- ---------
Total liabilities 2 (33,252) (46,389)
--------- ---------
Net assets 68,063 67,170
========= =========
Capital and reserves
Share capital - -
Share premium 1,866 1,866
Merger reserve 14,903 14,903
Other reserves 1,348 1,596
Retained earnings 39,992 39,882
--------- ---------
Equity attributable to equity holders of
the parent 58,109 58,247
Non-controlling interest 9,954 8,923
Total equity 68,063 67,170
========= =========
Unaudited Consolidated Statement of Changes in Equity
For the year ended 31 December 2018
Share Share Merger Other Retained Non-controlling Total
capital premium reserve reserves earnings interest
account
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- ---------- --------- --------- ---------- ---------- ---------------- --------
At 1 January
2017 - 336 17,151 1,596 39,587 8,415 67,085
Profit for the
year - - - - 2,826 839 3,665
Revaluation of
available for
sale investments - - - (14) - - (14)
Foreign currency
translation - - - - 380 136 516
Valuation change
on cash flow
hedge - - - 84 - 21 105
Tax on cash flow
hedge - - - (16) - (4) (20)
Total comprehensive
income - - - 54 3,206 992 4,252
Decrease in deferred
tax asset recognised
directly in equity) - - - (62) - - (62)
Equity dividends
paid - - - - (2,167) - (2,167)
Dividends paid
to non controlling
interests/ rebalancing
of non controlling
interest - - - - (744) (694) (1,438)
Issue of shares - 1,530 - - - - 1,530
Repurchase/cancellation
of own shares - - (2,248) - - - (2,248)
Credit in relation
to share based
payments - - - 8 - - 8
Investment by
non controlling
interest in subsidiaries - - - - - 210 210
At 31 December
2017 - 1,866 14,903 1,596 39,882 8,923 67,170
========== ========= ========= ========== ========== ================ ========
Unaudited Consolidated Statement of Changes in Equity
For the year ended 31 December 2018
Share Share Merger Other Retained Non-controlling Total
capital premium reserve Reserves earnings interest
account
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------- ---------- --------- --------- ---------- ---------- ---------------- --------
At 1 January
2018 - 1,866 14,903 1,596 39,882 8,923 67,170
Transition adjustment
- IFRS 9 Financial
instruments - - - 48 (48) - -
At 1 January
2018 (as restated) - 1,866 14,903 1,644 39,834 8,923 67,170
Profit for the
year - - - - 2,727 856 3,583
Foreign currency
translation - - - - 224 75 299
Valuation change
on cash flow
hedge - - - (203) - 2 (201)
Tax on cash
flow hedge - - - 38 - - 38
Total comprehensive
income - - - (165) 2,951 933 3,719
Equity dividends
paid - - - - (2,158) - (2,158)
Dividends paid
to non controlling
interests/ rebalancing
of non controlling
interest - - - - (635) (1,308) (1,943)
Debit in relation
to share based
payments - - - (131) - - (131)
Investment by
non controlling
interest in
subsidiaries - - - - - 1,406 1,406
At 31 December
2018 - 1,866 14,903 1,348 39,992 9,954 68,063
========== ========= ========= ========== ========== ================ ========
Unaudited Consolidated Cash Flow Statement
For the year ended 31 December 2018
Notes 2018 2017
GBP'000 GBP'000
------------------------------------------------- ------ --------- --------
Cash flows from operating activities
Operating profit 4,405 4,912
Adjustments for:
Depreciation and impairment charges 1,262 2,775
Share-based payment (credit) / expense (131) 8
Fair value (gains)/ losses on Principal
Finance investments (367) 320
Share of results of associates - (805)
Reduction in provision for national insurance
on options (36) (38)
--------- --------
Operating cash flows before movements in
working capital 5,133 7,172
Decrease / (increase) in trade and other
receivables 11,787 (902)
(Decrease) / Increase in trade and other
payables (6,833) 3,369
(Decrease) / Increase in trading liabilities (309) 252
(Increase) / decrease in trading assets (1,683) 4,136
--------- --------
Cash generated by operations 8,095 14,027
Interest paid (380) (430)
Corporation tax paid (1,207) (962)
--------- --------
Net cash generated by operating activities 6,508 12,635
--------- --------
Cash flows from investing activities
Purchase of property, plant and equipment (882) (681)
Sale of property, plant and equipment - 80
Sale of investment property - 2,885
Acquisition of subsidiary, net of cash (826) -
acquired
Investment in associate - (7,000)
Redemption of shares in associate - 7,750
Income from associate - 55
Purchase of Principal Finance investments (803) -
Sale of Principal Finance investments 1,270 314
Investment by non controlling interest
in subsidiaries 1,331 210
Interest received 43 95
--------- --------
Net cash generated by investing activities 133 3,708
--------- --------
Cash flows from financing activities
Issue of shares - 1,530
Repurchase of own shares - (2,248)
Decrease in borrowings (12,192) (393)
New borrowings 4,458 -
Dividends paid to equity shareholders 3 (2,158) (2,167)
Dividends paid to non controlling interests (1,943) (1,438)
--------- --------
Net cash used in financing activities (11,835) (4,716)
--------- --------
Net (decrease) / increase in cash and cash
equivalents (5,194) 11,627
Effects of exchange rate changes 536 109
Cash and cash equivalents at the beginning
of the year 35,673 23,937
--------- --------
Cash and cash equivalents at the end of
the year 31,015 35,673
========= ========
Notes
1. Financial information
Basis of preparation
The annual financial statements of Shore Capital Group Limited
(the "Company") have been prepared in accordance with International
Financial Reporting Standards ("IFRS") as adopted by the European
Union ("Adopted IFRS").
The accounting policies adopted are those disclosed in the 2017
Annual Report other than for the adoption of new accounting
standards described below.
New standards, interpretations and amendments effective from 1
January 2018
New standards impacting the Group that have been adopted in the
annual financial statements for the year ended 31 December 2018,
and which have given rise to changes in the Group's accounting
policies are:
-- IFRS 9 Financial Instruments (IFRS 9); and
-- IFRS 15 Revenue from Contracts with Customers (IFRS 15)
Details of the impact of these two standards will be given in
the annual financial statements. However, adoption has not had a
significant effect on the amounts recognised in the Group's
financial statements although there have been some presentational
changes.
Presentation of the financial statements and financial
information
The financial information set out in the announcement does not
constitute the Company's statutory accounts for the year ended 31
December 2018 within the meaning of section 244 of the Companies
(Guernsey) Law, 2008.
The financial information for the year ended 31 December 2017 is
derived from the statutory accounts of the Company for that year.
The auditors reported on those accounts; their report was
unqualified, did not draw attention to any matters by way of
emphasis without qualifying their report and did not contain a
statement under section 263(2) or (3) of the Companies (Guernsey)
Law, 2008. Those accounts were prepared under Adopted IFRS and have
been reported on by the Company's auditors.
The audit of the statutory accounts of Shore Capital Group
Limited for the year ended 31 December 2018 is not yet complete.
These accounts will be finalised on the basis of the financial
information presented by the directors in this preliminary
announcement.
The statutory accounts have been prepared in accordance with
IFRS as adopted by the European Union. Details of the accounting
policies that will be applied in the statutory accounts will be set
out in the 2018 Annual Report and Accounts of the Company.
A copy of this statement is available on the Company's website
at www.shorecap.gg.
The financial statements have been prepared on the historical
cost basis, except for the revaluation of certain financial
instruments. The financial statements are rounded to the nearest
thousand except where otherwise indicated.
2. Segment Information
For management purposes, the Group is organised into business
units based on their services, and has four reportable operating
segments as follows:
-- Capital Markets provides research in selected sectors,
broking for institutional and professional clients, market-making
in small cap and mid-cap stocks, fixed income broking and corporate
broking and advisory for large, mid and small cap companies.
-- Asset Management provides advisory services and manages
specialist funds.
-- Central Costs comprises the costs of the Group's central
management team and structure
-- Principal Finance comprises investments and other holdings
acquired, together with principal finance activities conducted,
using the Group's own balance sheet resources.
Management monitors the operating results of its business
segments separately for the purpose of making decisions about
resource allocation and performance assessment. Segmental
performance is evaluated based on operating profit or loss.
Transfer prices between operating segments are on an arms-length
basis in a manner similar to transactions with third parties.
Year ended 31 December Capital Asset Management Central Principal Consolidated
2018 Markets costs Finance
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ --------- ----------------- -------- ---------- -------------
Revenue 25,452 15,843 - 2,039 43,334
========= ================= ======== ========== =============
Results
Depreciation (278) (127) (67) (790) (1,262)
Interest expense (86) (78) - (216) (380)
Profit/(loss) before
tax 4,058 3,166 (1,637) (1,519) 4,068
========= ================= ======== ========== =============
Assets 56,658 10,018 1,599 33,040 101,315
========= ================= ======== ========== =============
Liabilities (23,337) (3,651) (855) (5,409) (33,252)
========= ================= ======== ========== =============
Year ended 31 December Capital Asset Management Central Principal Consolidated
2017 Markets costs Finance
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- --------- ----------------- -------- ---------- -------------
Revenue 27,230 12,906 - 1,760 41,896
========= ================= ======== ========== =============
Results
Share of results
of associates - - - 805 805
Balance sheet impairments - - - (1,883) (1,883)
Depreciation (262) (87) (65) (477) (891)
Interest expense (103) - - (327) (430)
Profit/(loss) before
tax 5,193 3,001 (1,651) (1,966) 4,577
========= ================= ======== ========== =============
Assets 66,317 8,319 2,948 35,975 113,559
========= ================= ======== ========== =============
Liabilities (33,300) (2,622) (637) (9,830) (46,389)
========= ================= ======== ========== =============
No material amounts of revenue or profit before tax were
generated outside Europe.
3. Rates of Dividends Paid and Proposed
2018 2017
GBP'000 GBP'000
----------------------------------------------------------- -------- --------
Amounts recognised as distributions to equity
holders in the period:
Final dividend for the year ended 31 December
2016 of 5.0p per share - 1,088
Interim dividend for the year ended 31 December
2017 of 5.0p per share - 1,079
Final dividend for the year ended 31 December 1,079 -
2017 of 5.0p per share
Interim dividend for the year ended 31 December 1,079 -
2018 of 5.0p per share
-------- --------
2,158 2,167
-------- --------
The directors propose a final dividend of 5.0p per share,
bringing the total for the year ended 31 December 2018 to 10.0p per
share (2017: 10.0p per share).
4. Earnings per Share
The earnings and number of shares in issue or to be issued used
in calculating the earnings per share and diluted earnings per
share in accordance with IAS 33 were as follows:
As at 31 December 2018 there were 21,573,322 ordinary shares in
issue (2017: 21,573,322).
2018 2017
Basic Diluted Basic Diluted
--------------------------------- ----------- ----------- ----------- -----------
Earnings (GBP) 2,727,000 2,727,000 2,826,000 2,826,000
Number of shares 21,573,322 21,840,354 21,645,329 22,019,172
Earnings per share (p) 12.6 12.5 13.1 12.8
=========== =========== =========== ===========
Calculation of number of shares 2018 2017
Basic Diluted Basic Diluted
--------------------------------- ----------- ----------- ----------- -----------
Weighted average number of
shares 21,573,322 21,573,322 21,645,329 21,645,329
Dilutive effect of share option
schemes - 267,032 - 373,843
21,573,322 21,840,354 21,645,329 22,019,172
=========== =========== =========== ===========
5. Subsequent events
On 13 February 2019 Shore Capital Markets Limited, a subsidiary
of the Group, agreed the acquisition of the entire issued share
capital of Stockdale Securities Limited ("Stockdale") for an
initial consideration of GBP4.9 million and a maximum deferred
consideration of up to GBP4.0 million. Stockdale is authorised and
regulated by the Financial Conduct Authority and completion of the
acquisition is expected to take place on 31 March 2019.
On 12 March 2019 the Group signed a 10 year occupational lease
with a 5 year break clause for its new London office.
Notes
A copy of this announcement is available on the Company's
website at www.shorecap.gg. The annual report & accounts will
be sent to shareholders in due course and will also be available on
the Company's website from the date of posting.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR PGUBCWUPBGRU
(END) Dow Jones Newswires
March 21, 2019 03:02 ET (07:02 GMT)
Shore Capital (LSE:SGR)
Gráfica de Acción Histórica
De Abr 2024 a May 2024
Shore Capital (LSE:SGR)
Gráfica de Acción Histórica
De May 2023 a May 2024
