TIDMPOLR

RNS Number : 0417T

Polar Capital Holdings PLC

22 November 2021

Polar Capital Holdings plc ("Polar Capital" or "the Group")

Unaudited interim results for six months ended 30 September 2021

65% increase in core profits

Highlights

   --    Assets under Management ("AuM") at 30 September 2021 GBP23.4bn (31 March 2021: GBP20.9bn) 
   --    Core operating profit GBP36.3m (30 September 2020: GBP22.0m) 
   --    Pre-tax profit GBP31.7m (30 September 2020: GBP27.0m) 

-- Basic earnings per share 26.5p (30 September 2020: 23.4p) and adjusted diluted total earnings per share 28.1p (30 September 2020: 22.1p)

-- Interim dividend per ordinary share of 14.0p (January 2021: 9.0p) declared to be paid in January 2022 (*)

-- Shareholders' funds GBP146.8m (30 September 2020: GBP114.4m) including cash and investments of GBP140.5m (30 September 2020: GBP111.3m)

T he non-GAAP alternative performance measures shown here are described and reconciled to IFRS measures on the Alternative Performance Measures (APM) page

* Further details on the timetable for the interim dividend are described on the shareholder information page

Gavin Rochussen, Chief Executive Officer, commented:

" In the six months to 30 September 2021, AuM increased by GBP2.5bn from GBP20.9bn to GBP23.4bn, an increase of 12% over the period and since then has increased to GBP25.0bn as at 12 November 2021.

"Core operating profit (excluding performance fees, other income and exceptional items) was up 65% to GBP36.3m compared to the comparable prior half year period and up 23% from GBP29.5m in the immediately preceding six-month period to 31 March 2021.

"This time last year, Polar Capital established a new Head of Sustainability role and put in place separate Sustainability and Diversity committees to increase focus on these areas, in investment and for the Group. Six of Polar Capital's funds have been classified as Article 8 under the European Union's SFDR regulations and there is a pipeline of funds aiming to reclassify as Article 8. The recently launched Smart Energy and Smart Mobility funds are classified as Article 9 funds.

"There is much greater concern about the impact of climate change, and this will result in growing demand for greener technologies and the investment landscape will be shaped by the conversations and outcomes from COP26 held in Glasgow.

"The launch of the Polar Capital Smart Energy and Smart Mobility Funds in September 2021 were well received with early flows and demonstrable appetite from potential investors in these funds.

"Our diverse and differentiated range of sector, thematic and regional fund strategies and our performance led culture where 74%, 93% and 99% of our AuM is in the top two quartiles against peers over three years, five years and since inception respectively together with significant remaining capacity provides confidence that momentum will continue."

 
 For further information please contact: 
 Polar Capital +44 (0)20 7227 2700 
  Gavin Rochussen (Chief Executive) 
  Samir Ayub (Finance Director) 
 
  Numis Securities- Nomad and Joint Broker +44 (0)20 7260 1000 
  Charles Farquhar 
  Stephen Westgate 
  Giles Rolls (QE) 
 
  Peel Hunt - Joint Broker +44 (0)20 3597 8680 
  Andrew Buchanan 
  Rishi Shah 
 
  Camarco +44 (0)20 3757 4995 
  Ed Gascoigne-Pees 
  Jennifer Renwick 
  Monique Perks 
  Phoebe Pugh 
 

Assets Under Management

AuM split by type

 
                          30 September                           31 March 2021 
                                  2021 
---------------------  ---------------  --------------------  ---------------- 
                          GBPbn      %                            GBPbn      % 
---------------------  --------  -----  --------------------  ---------  ----- 
 Open-ended funds          17.8    76%   Open-ended funds          16.6    79% 
 Investment trusts          4.5    19%   Investment trusts          3.9    19% 
 Segregated mandates        1.1     5%   Segregated mandates        0.4     2% 
---------------------  --------  -----  --------------------  ---------  ----- 
 Total                     23.4          Total                     20.9 
---------------------  --------  -----  --------------------  ---------  ----- 
 

AuM split by strategy

(Ordered according to launch date)

 
                              30 September                              31 March 2021 
                                      2021 
-------------------------  ---------------  -----------------------  ---------------- 
                              GBPbn      %                              GBPbn       % 
-------------------------  --------  -----  -----------------------  --------  ------ 
 Technology                    10.7    46%   Technology                  10.2     49% 
 Japan                          0.2   0.8%   Japan                        0.1    0.5% 
 European Long/Short            0.1   0.4%   European Long/Short          0.2      1% 
 Healthcare                     3.8    16%   Healthcare                   2.9     14% 
 Financials                     0.5     2%   Financials                   0.3      1% 
 Insurance                      1.7     7%   Insurance                    1.7      8% 
                                             Emerging Markets 
 Emerging Markets Income          -      -    Income                      0.1    0.5% 
 Convertibles                   0.8     3%   Convertibles                 0.8      4% 
 North America                  0.9     4%   North America                0.8      4% 
 European Income                0.1   0.4%   European Income              0.2      1% 
 UK Value                       1.7     7%   UK Value                     1.4      7% 
 Emerging Markets and                        Emerging Markets 
  Asia                          0.9     4%    and Asia                    0.4      2% 
 Phaeacian                      0.6     3%   Phaeacian                    0.5      2% 
 European Opportunities         1.3     6%   European Opportunities       1.1      5% 
 European Absolute                           European Absolute 
  Return                        0.1   0.4%    Return                      0.1    0.5% 
 Melchior Global Equity           *      -   Melchior Global Equity       0.1    0.5% 
 Sustainable Thematic            **      -   Sustainable Thematic           -       - 
  Equity                                      Equity 
-------------------------  --------  -----  -----------------------  --------  ------ 
 Total                         23.4          Total                       20.9 
-------------------------  --------  -----  -----------------------  --------  ------ 
 
   *   AuM as at 30 September 2021 was GBP5m. 

** AuM as at 30 September 2021 comprised of seed capital of GBP7m.

Chief Executive's Report

Market Overview

The six-month period to the end of September 2021 saw a change in investment environment and market leadership. Growth once again outperformed value, and the technology sector was one of the best performers, with the materials and industrials sectors at the bottom of the pack.

US 10-year bond yields and the US 2-10 year yield curve hit a post COVID-19 high on 31 March 2021 and, until recently, had been moving persistently lower as excitement about economic re-opening began to wane in the face of continuing COVID-19 outbreaks across the world. This was the opposite of the prior six-month period; equity markets had rallied strongly from the point in early November 2020 when the first announcements on effective COVID-19 vaccines were made, and the victorious US Democrats proposed a stimulatory set of policy initiatives.

News media are giving extensive coverage to supply chain problems and intermediate goods shortages across the world. At the margin, these trends are likely to lead companies to carry more inventory, and to shorten supply lines in the search for resilience.

Talk of higher inflation is widespread, particularly in the UK, where apparent labour shortages in particular industries are exacerbating goods shortages. Oil and gas prices have risen rapidly. As ever, the solution has a political dimension. Europe does not want to concede too much to Russia, which plays a big role in gas supply.

Despite the possibility that these changes in investment backdrop bring greater risk, financial markets have so far been reasonably well behaved.

The reason for such a moderate response may be that growth remains strong in much of the world; output has probably peaked at high levels but should remain above trend through 2022. Similarly, while central banks are starting to remove policy support, it is likely to be some time before policy becomes restrictive.

Equally, governments have little incentive to endanger the nascent recovery by tightening fiscal policy too rapidly. Paying down large amounts of COVID-19 related debt would be much harder in a lower growth phase.

Data indicates that US consumers have not spent all of the stimulus cheques which they received. This means that there is still pent-up consumer demand, but it may be the case that households want to retain a higher level of savings in these uncertain times.

There is much greater concern about the impact of climate change, and this will result in growing demand for greener technologies and the investment landscape will be shaped by the conversations and outcomes from COP26 held in Glasgow.

Fund Performance

The past 18 months have seen significant variability in equity market leadership, visible in the performance of value versus growth and quality, of small companies versus large and, more broadly, of disruptors versus more established businesses.

The six months to end September 2021 saw the style pendulum swing back from value to growth, consistent with lower market interest rates. Those Polar strategies with greater value orientation, such as North America and European ex UK Income underperformed over the period, although strategies which combine value and quality, such as UK Value and Phaeacian International Value, outperformed their benchmarks.

In the growth group, Emerging Market Stars and Asian Stars, both of which incorporate sustainability as an important part of their process, delivered outperformance, building on their strong foundations since inception at Polar in 2018.

Polar Capital's Technology and Healthcare teams have had a tougher time in the first six months of the financial year. The Global Technology Fund and the Healthcare Opportunities fund underperformed, in part due to the outperformance of the very large companies in their respective areas; both strategies have an all-cap orientation. The Technology team came into 2021 with a cautious view of their sector, due to high valuations; their defensive tactics, expressed via cash and index puts, have not yet borne fruit as valuations across the sector have continued to go up.

The small and mid-cap Healthcare Discovery fund, the Healthcare Blue Chip fund, and the Automation and Artificial Intelligence fund have outperformed their benchmarks nevertheless.

This time last year, Polar Capital established a new Head of Sustainability role and put in place separate Sustainability and Diversity committees to increase focus on these areas, in investment and for the Group. Six of Polar Capital's funds have been classified as Article 8 under the European Union's SFDR regulations and there is a pipeline of funds aiming to reclassify as Article 8. The recently launched Smart Energy and Smart Mobility funds are classified as Article 9 funds.

As at 29 October 2021, 74% of Polar Capital's UCITS fund AuM is ranked in the top two quartiles versus peers over three years with 21% ranked in the top quartile over the same period. Over five years, 74% of AuM is ranked top quartile and 93% ranked in the top two quartiles versus the Lipper peer group. Since inception, 84% of AuM is ranked in the top quartile and 99% is ranked in the top two quartiles.

AuM and Fund Flows

In the six months to 30 September 2021, AuM increased by GBP2.5bn from GBP20.9bn to GBP23.4bn, an increase of 12% over the period and since then has increased to GBP25.0bn as at 12 November 2021. The GBP2.5bn increase in AuM comprised net subscriptions of GBP690m and GBP1,807m relating to market movement and fund performance. There were net inflows of GBP596m into segregated mandates, net inflows from share issuance of GBP136m by the investment trusts and net outflows of GBP42m from the open-ended funds.

In the six months, the largest beneficiaries of net inflows were the sustainability oriented Emerging Market Stars Fund with GBP366m of net inflows and the Asian Stars Fund which had net inflows of GBP70m. Within the healthcare suite of funds, the Biotechnology Fund benefited from net inflows of GBP199m and three segregated healthcare mandates were funded with GBP427m. The Polar Capital Global Financials Trust had share issuances amounting to GBP154m while the Polar Capital Technology Trust had net share buy-backs amounting to GBP18m.

The Convertibles team attracted GBP85m of net inflows into their Global Convertible Fund and Global Absolute Return Fund. The Phaeacian International Mutual Fund had net inflows of GBP27m and the Japan Value Fund benefited from net inflows of GBP20m reversing a multi-year period of sustained net outflows.

The Technology Fund, which had benefited from inflows in 2020, suffered from client allocation decreasing away from the technology sector as well as profit taking by investors following excellent absolute performance over the past years. Net outflows from the fund, which was soft closed in 2020, were GBP413m and the A&AI Fund had outflows, for similar reasons, of GBP49m. While the UK Value Opportunities Fund, also soft-closed in 2020, suffered modest net outflows of GBP18m in the period, the team benefited from the funding of a segregated mandate amounting to GBP169m. Our North American Fund which has suffered sustained prior periods of net outflows saw this trend reduce and net outflows in the six-month period were GBP33m with net inflows in the more recent months.

Following the retirement of the lead fund manager, the GEM Income Fund was closed and merged with the Emerging Market Stars Fund resulting in GBP34m of net outflows in the period leading up to the merger of the two funds. Other funds experiencing outflows in the period were the European ex-UK Income Fund, Global Insurance Fund and Healthcare Opportunities Fund, although outflows from the latter were more than offset by the funding of segregated healthcare mandates.

The launch of the Polar Capital Smart Energy and Smart Mobility Funds in September 2021 were well received with early flows and demonstrable appetite from potential investors in these funds.

Results

Average AuM over the six months to 30 September 2021 increased by 53% to GBP22.5bn from GBP14.7bn in the comparable prior half year period, while there has been a 20% rise in average AuM compared to average AuM of GBP18.7bn for the immediately preceding six months to 31 March 2021. The increase in average AuM resulted in net management fees, after commission and rebates payable, increasing by 50% to GBP92.9m compared to the comparable six-month period and rose 15% compared to the immediately preceding six-month period. Management fee yield margin declined, as anticipated, by 1bp to 83bp compared to the comparable prior six-month period.

Core operating profit (excluding performance fees, other income and exceptional items) was up 65% to GBP36.3m compared to the comparable prior half year period and up 23% from GBP29.5m in the immediately preceding six-month period to 31 March 2021.

Profit before tax increased by 17% to GBP31.7m compared to the comparable prior half year period, although it declined compared to the immediately preceding six-month period which included performance fee profits which crystalise in the second half of our financial year. Basic EPS has increased by 13% compared to the half year period to September 2020. Adjusted diluted core EPS of 28.2p is a 25% increase on the immediately preceding six months to 31 March 2021 and a 56% increase over the comparable half year period to September 2020. Adjusted diluted total EPS of 28.1p is a 27% increase compared to the comparable six-month period to 30 September 2020.

 
                                        Six months  Six months to     Six months 
                                                to       31 March             to 
                                      30 September           2021   30 September 
                                              2021            GBP           2020 
                                               GBP                           GBP 
                                     -------------  -------------  ------------- 
Average AuM                                 22.5bn         18.7bn         14.7bn 
Net management fees                          92.9m          80.7m          61.8m 
Core operating profit                        36.3m          29.5m          22.0m 
Performance fee profit                           -          19.5m           0.5m 
Other income *                              (0.3)m           2.5m           4.9m 
Share-based payments on preference 
 shares                                     (0.4)m           0.7m         (0.4)m 
Exceptional items                           (3.9)m         (2.8)m              - 
                                     -------------  -------------  ------------- 
Profit before tax                            31.7m          48.9m          27.0m 
                                     -------------  -------------  ------------- 
Basic EPS                                    26.5p          43.8p          23.4p 
Adjusted diluted earnings per 
 share 
 (non-GAAP measure)                          28.1p          40.1p          22.1p 
Adjusted diluted core EPS                    28.2p          22.6p          18.0p 
                                     -------------  -------------  ------------- 
 

The non-GAAP alternative performance measures shown here are described on the APM page.

   *                     A reconciliation to reported results is given on the APM page. 

In accordance with the stated dividend policy, the Board has declared an interim dividend of 14p to be paid in January 2022 (January 2021: 9p). This represents a 56% increase in the first interim dividend which aligns with the increase in adjusted diluted core EPS.

Net inflows have continued in October 2021 and early November 2021 and the pipeline for the remainder of the financial year is encouraging.

Strategic progress and thanks

The sustainable thematic team joined Polar Capital in September 2021 and the Polar Capital Smart Energy and Smart Mobility Funds were launched. This provides additional capacity in appealing equity strategies and will, over time, further diversify the concentration of our assets under management across a broader array of teams. There has been considerable progress in the growth and diversification of our distribution activities and further investment in our digital marketing efforts. Following the funding of further segregated institutional mandates in the period, we had in excess of GBP1bn in segregated mandates at the period end including a mandate with an Australian institution marking success in our expansion into the Asia Pacific region.

Continued progress has been made in the area of sustainability both at Polar Capital corporate level and within our funds. In terms of SFDR, we have two Article 9 funds, six Article 8 Funds with a pipeline of funds aiming to reclassify as Article 8.

With the attainment of a highly credible three-year track record since joining Polar Capital, the AuM in the sustainable Emerging Market Stars suite of fund strategies now exceeds GBP1bn and has been instrumental in establishing a meaningful and valued client base in the Nordic region.

During the period, Polar Capital was recognised as Boutique of the Year in the Financial News Fund Manager awards.

We are extremely grateful for the support of our clients and the hard work and commitment of our partners and staff during the period as we continue to emerge from lockdown into a more normalised working environment.

Outlook

Our diverse and differentiated range of sector, thematic and regional fund strategies and our performance led culture where 74%, 93% and 99% of our AuM is in the top two quartiles against peers over three years, five years and since inception respectively together with significant remaining capacity provides confidence that momentum will continue.

Gavin Rochussen

Chief Executive

19 November 2021

Alternate Performance Measures (APMs)

 
 APM                  Definition                Reconciliation       Reason for use 
-------------------  ------------------------  -------------------  --------------------------------------- 
 Core operating       Profit before             APM reconciliation   To present a measure of the 
  profit               performance                                    Group's profitability excluding 
                       fee profits,                                   performance fee profits and 
                       other income,                                  other components which may 
                       exceptional                                    be volatile, non-recurring 
                       items and tax.                                 or non-cash in nature. 
-------------------  ------------------------  -------------------  --------------------------------------- 
 Performance fee      Gross performance         APM reconciliation   To present a clear view of 
  profit               fee revenue                                    the net amount of performance 
                       less performance                               fee earned by the Group after 
                       fee interests                                  accounting for staff remuneration 
                       due to staff.                                  payable that is directly attributable 
                                                                      to performance fee revenues 
                                                                      generated. 
-------------------  ------------------------  -------------------  --------------------------------------- 
 Core distributions   Variable compensation     APM reconciliation   To present additional information 
                       payable to investment                          thereby assisting users of 
                       teams from management                          the accounts in understanding 
                       fee revenue.                                   key components of variable 
                                                                      costs paid out of management 
                                                                      fee revenue. 
-------------------  ------------------------  -------------------  --------------------------------------- 
 Performance          Variable compensation     APM reconciliation   To present additional information 
  fee interests        payable to investment                          thereby assisting users of 
                       teams from performance                         the accounts in understanding 
                       fee revenue.                                   key components of variable 
                                                                      costs paid out of performance 
                                                                      fee revenue. 
-------------------  ------------------------  -------------------  --------------------------------------- 
 Adjusted diluted     Profit after              APM reconciliation   The Group believes that (a) 
  total EPS            tax but excluding                              as the preference share awards 
                       (a) cost of                                    have been designed to be earnings 
                       share-based                                    enhancing to shareholders 
                       payments on                                    adjusting for this non-cash 
                       preference shares,                             item provides a better understanding 
                       (b) the net                                    of the financial performance 
                       cost of deferred                               of the Group, (b) comparing 
                       staff remuneration                             staff remuneration and profits 
                       and (c) exceptional                            generated in the same time 
                       items which                                    period (rather than deferring 
                       may either be                                  remuneration over a longer 
                       non-recurring                                  vesting period) allows users 
                       or non-cash                                    of the accounts to gain a 
                       in nature, and                                 better understanding of the 
                       in the case                                    Group's results and their 
                       of adjusted                                    comparability period on period 
                       diluted earnings                               and (c) removing acquisition 
                       per share, divided                             related transition and termination 
                       by the weighted                                costs as well as the non-cash 
                       average number                                 amortisation, and any impairment, 
                       of ordinary                                    of intangible assets and goodwill 
                       shares.                                        provides a better understanding 
                                                                      of the Group's results and 
                                                                      allows users of the accounts 
                                                                      to better compare results 
                                                                      across companies to the extent 
                                                                      the identification, or not, 
                                                                      of intangible assets affects 
                                                                      the relative amortisation 
                                                                      costs. 
-------------------  ------------------------  -------------------  --------------------------------------- 
 Adjusted diluted     Core operating            APM reconciliation   To present additional information 
  core EPS             profit after                                   that allows users of the accounts 
                       tax excluding                                  to measure the Group's earnings 
                       the net cost                                   excluding those from performance 
                       of deferred                                    fees and other components 
                       core distributions                             which may be volatile, non-recurring 
                       divided by the                                 or non-cash in nature. 
                       weighted average 
                       number of ordinary 
                       shares. 
-------------------  ------------------------  -------------------  --------------------------------------- 
 Core operating       Core operating            Chief Executive's    To present additional information 
  margin               profit divided            report               that allows users of the accounts 
                       by                                             to measure the core profitability 
                       net management                                 of the Group before performance 
                       fees.                                          fee profits, and other components, 
                                                                      which can be volatile and 
                                                                      non-recurring. 
-------------------  ------------------------  -------------------  --------------------------------------- 
 Net Management       Net management            Chief Executive's    To present additional information 
  fee yield            fees divided              report               that allows users of the accounts 
                       by average AuM.                                to measure the fee margin 
                                                                      for the Group in relation 
                                                                      to its assets under management. 
-------------------  ------------------------  -------------------  --------------------------------------- 
 

Summary of non-GAAP financial performance and reconciliation of APMs to interim reported results

The summary below reconciles key APMs the Group measures to its interim reported results for the current year and also reclassifies the line by line impact on consolidation of seed investments to provide a clearer understanding of the Group's core business operation of fund management.

Any seed investments in newly launched or nascent funds, where the Group is determined to have control, are consolidated. As a consequence, the statement of profit or loss of the fund is consolidated into that of the Group on a line by line basis. Any seed investments that are not consolidated are fair valued through a single line item (other income) on the Group consolidated statement of profit or loss.

 
                                       Reclassification 
                             Interim   on consolidation                         Interim 
                            reported            of seed    Reclassification    Non-GAAP 
                             Results        investments            of costs     results 
                               GBP'm              GBP'm               GBP'm       GBP'm                APMs 
Investment management 
 and research fees             103.6                  -                   -       103.6 
Commissions and fees 
 payable                      (10.7)                  -                   -      (10.7) 
------------------------  ----------  -----------------  ------------------  ----------  ------------------ 
                                92.9                  -                   -        92.9 
Operating costs               (60.5)                0.3                29.0      (31.2) 
                                   -                  -              (25.4)      (25.4)  Core distributions 
 -----------------------  ----------  -----------------  ------------------  ----------  ------------------ 
                                                                                             Core operating 
                                32.4                0.3                 3.6        36.3             profits 
Investment performance             -                  -                   -           - 
 fees 
                                   -                  -                   -           -         Performance 
                                                                                              fee interests 
-----------------------   ----------  -----------------  ------------------  ----------  ------------------ 
                                   -                  -                   -           -         Performance 
                                                                                                fee profits 
Other income                   (0.7)              (0.3)                 0.7       (0.3) 
Share-based payments 
 on preference shares              -                  -               (0.4)       (0.4) 
Exceptional items                  -                  -               (3.9)       (3.9) 
------------------------  ----------  -----------------  ------------------  ----------  ------------------ 
Profit for the year             31.7                  -                   -        31.7 
------------------------  ----------  -----------------  ------------------  ----------  ------------------ 
 

The effect of the adjustments made in arriving at the adjusted diluted total EPS and adjusted diluted core EPS figures of the Group is as follows:

 
Earnings per share                                 Unaudited 
                                                30 September 
                                                        2021 
                                                       Pence 
--------------------------------------------   ------------- 
Diluted earnings per share                              25.3 
Impact of share-based payments - preference 
 shares only                                             0.4 
Impact of exceptional items                              3.9 
Impact of deferment, where IFRS defers 
 cost into future periods                              (1.5) 
---------------------------------------------  ------------- 
Adjusted diluted total EPS                              28.1 
Performance fee profit and other income                  0.1 
---------------------------------------------  ------------- 
Adjusted diluted core EPS                               28.2 
---------------------------------------------  ------------- 
 

Interim Consolidated Statement of Profit or Loss

For the six months to 30 September 2021

 
                                                      (Unaudited)       (Unaudited) 
                                                       Six months        Six months 
                                                  to 30 September   to 30 September 
                                                             2021              2020 
                                                          GBP'000           GBP'000 
-----------------------------------------------  ----------------  ---------------- 
Revenue                                                   103,647            68,826 
Other income                                                (722)             5,290 
-----------------------------------------------  ----------------  ---------------- 
Gross income                                              102,925            74,116 
Commissions and fees payable                             (10,735)           (6,055) 
-----------------------------------------------  ----------------  ---------------- 
Net income                                                 92,190            68,061 
Operating costs                                          (60,468)          (41,020) 
Profit for the period before tax                           31,722            27,041 
Taxation                                                  (6,366)           (5,216) 
-----------------------------------------------  ----------------  ---------------- 
Profit for the period attributable to ordinary 
 shareholders                                              25,356            21,825 
-----------------------------------------------  ----------------  ---------------- 
Earnings per share 
 Basic                                                      26.5p             23.4p 
Diluted                                                     25.3p             22.5p 
Adjusted basic (Non-GAAP measure)                           29.4p             23.0p 
Adjusted diluted (Non-GAAP measure)                         28.1p             22.1p 
-----------------------------------------------  ----------------  ---------------- 
 

Interim Consolidated Statement of Other Comprehensive Income

For the six months to 30 September 2021

 
                                                          (Unaudited)       (Unaudited) 
                                                           Six months        Six months 
                                                      to 30 September   to 30 September 
                                                                 2021              2020 
                                                              GBP'000           GBP'000 
---------------------------------------------------  ----------------  ---------------- 
Profit for the period attributable to ordinary 
 shareholders                                                  25,356            21,825 
Other comprehensive income - items that will 
 be reclassified to income statement in subsequent 
 periods: 
Net movement on the fair valuation of cash 
 flow hedges                                                        -             1,167 
Deferred tax effect                                                 -             (222) 
---------------------------------------------------  ----------------  ---------------- 
                                                                    -               945 
Exchange differences on translation of foreign 
 operations                                                       327             (668) 
---------------------------------------------------  ----------------  ---------------- 
Other comprehensive income for the period                         327               277 
---------------------------------------------------  ----------------  ---------------- 
Total comprehensive income for the period, 
 net of tax, attributable to ordinary shareholders             25,683            22,102 
---------------------------------------------------  ----------------  ---------------- 
 

All of the items in the above statements are derived from continuing operations.

Interim Consolidated Balance Sheet

As at 30 September 2021

 
                                                             (Audited) 
                                                (Unaudited)   31 March 
                                               30 September 
                                                       2021       2021 
                                                    GBP'000    GBP'000 
--------------------------------------------  -------------  --------- 
Non-current assets 
Goodwill and intangible assets                       26,743     24,998 
Property and equipment                                4,458      5,104 
Deferred tax assets                                   4,598      5,783 
--------------------------------------------  -------------  --------- 
                                                     35,799     35,885 
--------------------------------------------  -------------  --------- 
Current assets 
Assets at fair value through profit or loss          71,451     57,151 
Trade and other receivables                          27,621     23,924 
Other financial assets                                  164         84 
Current tax assets                                    3,136      1,966 
Cash and cash equivalents                           103,382    136,718 
                                                    205,754    219,843 
--------------------------------------------  -------------  --------- 
Total assets                                        241,553    255,728 
--------------------------------------------  -------------  --------- 
Non-current liabilities 
Liabilities at fair value through profit or 
 loss                                                 7,692      4,258 
Provisions and other liabilities                      3,505      4,123 
Deferred tax liabilities                              3,896      4,116 
--------------------------------------------  -------------  --------- 
                                                     15,093     12,497 
--------------------------------------------  -------------  --------- 
Current liabilities 
Liabilities at fair value through profit or 
 loss                                                15,076     16,124 
Trade and other payables                             64,182     71,598 
Other financial liabilities                             367      4,069 
                                                     79,625     91,791 
--------------------------------------------  -------------  --------- 
Total liabilities                                    94,718    104,288 
--------------------------------------------  -------------  --------- 
Net assets                                          146,835    151,440 
--------------------------------------------  -------------  --------- 
 
 
 
  Capital and reserves 
Issued share capital                                    2,502     2,468 
Share premium                                          19,364    19,364 
Investment in own shares                             (21,683)  (26,579) 
Capital and other reserves                             12,451    11,030 
Retained earnings                                     134,201   145,157 
---------------------------------------------------  --------  -------- 
Total equity attributable to ordinary shareholders    146,835   151,440 
---------------------------------------------------  --------  -------- 
 

Interim Consolidated Statement of Changes in Equity

For the six months to 30 September 2021

 
 
                             Issued            Investment 
                              share     Share      in own    Capital      Other   Retained 
                            capital   premium      shares   reserves   reserves   earnings  Total equity 
                            GBP'000   GBP'000     GBP'000    GBP'000    GBP'000    GBP'000       GBP'000 
------------------------  ---------  --------  ----------  ---------  ---------  ---------  ------------ 
 
As at 1 April 2021 
 (audited)                    2,468    19,364    (26,579)        695     10,335    145,157       151,440 
Profit for the period             -         -           -          -          -     25,356        25,356 
Other comprehensive 
 income                           -         -           -          -        327          -           327 
------------------------  ---------  --------  ----------  ---------  ---------  ---------  ------------ 
Total comprehensive 
 income                           -         -           -          -        327     25,356        25,683 
Dividends paid to 
 shareholders                     -         -           -          -          -   (29,836)      (29,836) 
Issue of shares                  34         -           -          -          -       (34)             - 
Own shares acquired               -         -     (7,629)          -          -          -       (7,629) 
Release of own shares             -         -      12,525          -          -   (10,489)         2,036 
Share-based payment               -         -           -          -          -      4,047         4,047 
Current tax in respect 
 of employee share 
 options                          -         -           -          -      2,477          -         2,477 
Deferred tax in respect 
 of employee share 
 options                          -         -           -          -    (1,383)          -       (1,383) 
------------------------  ---------  --------  ----------  ---------  ---------  ---------  ------------ 
As at 30 September 
 2021 (unaudited)             2,502    19,364    (21,683)        695     11,756    134,201       146,835 
------------------------  ---------  --------  ----------  ---------  ---------  ---------  ------------ 
 
 
As at 1 April 2020 
 (audited)                2,417  19,101  (24,139)  695  7,646   110,358   116,078 
Profit for the period         -       -         -    -      -    21,825    21,825 
Other comprehensive 
 income                       -       -         -    -    277         -       277 
------------------------  -----  ------  --------  ---  -----  --------  -------- 
Total comprehensive 
 income                       -       -         -    -    277    21,825    22,102 
Dividends paid to 
 shareholders                 -       -         -    -      -  (23,494)  (23,494) 
Issue of shares              45      38         -    -      -      (44)        39 
Own shares acquired           -       -   (4,277)    -      -         -   (4,277) 
Release of own shares         -       -     2,287    -      -   (1,150)     1,137 
Share-based payment           -       -         -    -      -     2,282     2,282 
Current tax in respect 
 of employee share 
 options                      -       -         -    -    145         -       145 
Deferred tax in respect 
 of employee share 
 options                      -       -         -    -    414         -       414 
------------------------  -----  ------  --------  ---  -----  --------  -------- 
As at 30 September 
 2020 (unaudited)         2,462  19,139  (26,129)  695  8,482   109,777   114,426 
------------------------  -----  ------  --------  ---  -----  --------  -------- 
 

Interim Consolidated Cash Flow Statement

For the six months to 30 September 2021

 
                                                    (Unaudited)       (Unaudited) 
                                                     Six months        Six months 
                                                to 30 September   to 30 September 
                                                           2021              2020 
                                                        GBP'000           GBP'000 
---------------------------------------------  ----------------  ---------------- 
Operating activities 
Cash generated from operations                           27,015             5,718 
Tax paid                                                (5,404)           (5,069) 
Interest on lease                                          (51)              (65) 
---------------------------------------------  ----------------  ---------------- 
Net cash flow from operating activities                  21,560               584 
---------------------------------------------  ----------------  ---------------- 
Investing activities 
Interest received and similar income                         13                37 
Investment income                                           176               137 
Sale of assets at fair value through profit 
 or loss                                                 14,698            18,166 
Purchase of assets at fair value through 
 profit or loss                                        (30,666)          (18,357) 
Re-measurement of purchase consideration 
 in respect of business acquisition                          38                 - 
Payments in respect of asset acquisition                  (363)                 - 
Purchase of property and equipment                         (30)              (50) 
Net cash outflow from investing activities             (16,134)              (67) 
---------------------------------------------  ----------------  ---------------- 
Financing activities 
Dividends paid to shareholders                         (29,836)          (23,494) 
Issue of shares                                               -                 9 
Purchase of own shares                                  (7,585)           (3,900) 
Lease payments                                            (653)             (648) 
Third-party subscriptions into consolidated 
 funds                                                    3,194             2,501 
Third-party redemptions from consolidated 
 funds                                                  (3,811)              (94) 
Net cash outflow from financing activities             (38,691)          (25,626) 
---------------------------------------------  ----------------  ---------------- 
Net decrease in cash and cash equivalents              (33,265)          (25,109) 
Cash and cash equivalents at start of period            136,718           107,753 
Effect of exchange rate changes on cash and 
 cash equivalents                                          (71)             (170) 
---------------------------------------------  ----------------  ---------------- 
Cash and cash equivalents at end of period              103,382            82,474 
---------------------------------------------  ----------------  ---------------- 
 

Notes to the Unaudited Interim Consolidated Financial Statements

For the six months to 30 September 2021

   1.    General Information, Basis of Preparation and Accounting Policies 
   1.1            General information 

Polar Capital Holdings plc ("the Company") is a public limited Company registered in England and Wales.

   1.2            Basis of Preparation 

The unaudited interim condensed consolidated financial statements to 30 September 2021 have been prepared in accordance with IAS 34: Interim Financial Reporting.

The unaudited interim condensed consolidated financial statements do not include all the information and disclosures required in annual financial statements and should be read in conjunction with the Group's annual financial statements as at 31 March 2021, which have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and the Companies Act 2006 applicable to companies reporting under IFRS.

The accounting policies adopted and the estimates and judgements used in the preparation of the unaudited interim condensed consolidated financial statements are consistent with the Group's annual financial statements for the year ended 31 March 2021.

   1.3            Group information 

The Group is required to consolidate seed capital investments where it is deemed to control them. In addition to the operating subsidiaries and seed capital investments consolidated at 31 March 2021, the Group has consolidated the following two funds as at 30 September 2021:

   --    Polar Capital Smart Energy Fund 
   --    Polar Capital Smart Mobility Fund 
   1.4          Going concern 

The Directors have made an assessment of going concern taking into account both the Group's current results as well as the Group's outlook. As part of this assessment the Directors have used information available to the date of issue of these interim financial statements and considered the following key areas:

-- Analysis of the Group's budget for the year ending March 2022, longer-term financial projections and its regulatory capital position and forecasts. The stress testing scenarios applied as part of the Group's ICAAP have also been revisited to ensure they remain appropriate.

-- Cash flow forecasts and an analysis of the Group's liquid assets, which include cash and cash equivalents and seed investments.

-- The operational resilience of the Group and its ability to meet client servicing demands across all areas of the Group's business, including outsourced functions, whilst ensuring the wellbeing and health of its staff.

The Group continues to maintain a robust financial resources position, access to cashflow from ongoing investment management contracts and the Directors believe that the Group is well placed to manage its business risks. The Directors also have a reasonable expectation that the Group has adequate resources to continue operating for a period of at least 12 months from the balance sheet date. Therefore, the Directors continue to adopt the going concern basis of accounting in preparing the consolidated financial statements.

   2.    Revenue 
 
                                               (Unaudited)       (Unaudited) 
                                                Six months        Six months 
                                           to 30 September   to 30 September 
                                                      2021              2020 
                                                   GBP'000           GBP'000 
----------------------------------------  ----------------  ---------------- 
Investment management and research fees            103,647            67,909 
Investment performance fee                               -             1,050 
Loss on forward currency contracts                       -             (133) 
----------------------------------------  ----------------  ---------------- 
                                                   103,647            68,826 
----------------------------------------  ----------------  ---------------- 
 

Effective 1 April 2021, the Group has discontinued its revenue hedging programme.

   3.    Operating costs 

a) Operating costs include the following items:

 
                                                            (Unaudited)       (Unaudited) 
                                                             Six months        Six months 
                                                        to 30 September   to 30 September 
                                                                   2021              2020 
                                                                GBP'000           GBP'000 
-----------------------------------------------------  ----------------  ---------------- 
Staff costs including partnership profit allocations             46,576            30,437 
Depreciation                                                        678               670 
Amortisation of intangible assets                                   932                 - 
Auditors remuneration                                               175               133 
-----------------------------------------------------  ----------------  ---------------- 
 

b) Auditors' remuneration:

 
Audit of Group financial statements             68   43 
Local statutory audits of subsidiaries          63   51 
Audit-related assurance services                 5    - 
Other assurance services - internal controls 
 review                                         39   39 
                                               175  133 
---------------------------------------------  ---  --- 
 
   4.    Other income 
 
                                                       (Unaudited)       (Unaudited) 
                                                        Six months        Six months 
                                                   to 30 September   to 30 September 
                                                              2021              2020 
                                                           GBP'000           GBP'000 
------------------------------------------------  ----------------  ---------------- 
Interest income and cash and cash equivalents                   13                41 
Net gain/ (loss) on other financial liabilities 
 - short positions and futures                               1,704           (4,600) 
Net (loss)/gain on forward contracts                         (440)               718 
Net gain on financial assets at FVTPL                          360             4,308 
Net (loss)/ gain on financial liabilities at 
 FVTPL                                                     (3,048)             5,347 
Investment income                                              190               155 
Other gain/ (loss) - attributed to third party 
 holdings                                                      499             (679) 
                                                             (722)             5,290 
------------------------------------------------  ----------------  ---------------- 
 

Net loss on financial liabilities at fair value through profit or loss includes a mark to market charge of GBP0.7m relating to the deferred consideration payable on the Dalton acquisition .

   5.    Dividends 
 
                     (Unaudited)       (Unaudited) 
                      Six months        Six months 
                 to 30 September   to 30 September 
                            2021              2020 
                         GBP'000           GBP'000 
--------------  ----------------  ---------------- 
Dividend paid             29,836            23,494 
--------------  ----------------  ---------------- 
 

On 31 July 2021, the Group paid a second interim dividend for 2021 of 31p (2020: 25p) per ordinary share.

   6.    Share-based Payments 

A summary of the charge to the consolidated statement of profit or loss for each share-based payment arrangement is as follows:

 
                                     (Unaudited)       (Unaudited) 
                                      Six months        Six months 
                                 to 30 September   to 30 September 
                                            2021              2020 
                                         GBP'000           GBP'000 
------------------------------  ----------------  ---------------- 
Preference shares                            444               429 
LTIP and initial share awards              2,303               810 
Equity incentive plan                        739               380 
Deferred remuneration plan                   561               663 
------------------------------  ----------------  ---------------- 
                                           4,047             2,282 
------------------------------  ----------------  ---------------- 
 

Certain employees of the Group and partners of Polar Capital LLP hold Manager Preference Shares or Manager Team Member Preference Shares (together 'Preference Shares') in Polar Capital Partners Limited, a group company.

The preference shares are designed to incentivise and retain the Group's fund management teams. These shares provide each manager with an economic interest in the funds that they run and ultimately enable the manager, at their option and at a future date, to convert their interest in the revenues generated from their funds to a value that may (at the discretion of the parent undertaking, Polar Capital Holdings plc) be satisfied by the issue of ordinary shares in Polar Capital Holdings plc. Such conversion takes place according to a pre-defined conversion formula intended to be earnings enhancing for the Group and that considers the relative contribution of the manager to the Group as a whole. The equity is awarded in return for the forfeiture of a manager's current core economic interest and is issued over three years from the date of conversion.

In November 2021, the Biotechnology team called for a full conversion and the Convertible team called for a partial conversion of preference shares into Polar Capital Holdings equity (2020: none). At 30 September 2021, three sets of preference shares (2020: four sets) have the right to call for conversion.

The following table illustrates the number of, and movements in, the estimated number of ordinary shares to be issued.

Estimated number of ordinary shares to be issued against preference shares with a right to call for conversion:

 
                                   (Unaudited)        (Unaudited) 
                                  30 September       30 September 
                                          2021               2020 
                              Number of shares   Number of shares 
---------------------------  -----------------  ----------------- 
At 1 April                           4,426,258          4,676,882 
Conversion/crystallisation         (1,350,514)                  - 
Movement during the period           (718,593)            147,276 
At 30 September                      2,357,421          4,824,158 
---------------------------  -----------------  ----------------- 
 

Number of ordinary shares to be issued against converted preference shares:

 
                                     (Unaudited)        (Unaudited) 
                                    30 September       30 September 
                                            2021               2020 
                                Number of shares   Number of shares 
-----------------------------  -----------------  ----------------- 
Outstanding at 1 April                 1,766,541          3,733,904 
Conversion/crystallisation             1,350,514                  - 
Adjustment on re-calculation                   -           (28,261) 
Issued during the period             (1,333,921)        (1,622,380) 
Outstanding at 30 September            1,783,134          2,083,263 
-----------------------------  -----------------  ----------------- 
 
   7.    Earnings Per Share 

A reconciliation of the figures used in calculating the basic, diluted and adjusted earnings per share (EPS) figures is as follows:

 
                                                        (Unaudited)        (Unaudited) 
                                                         Six months         Six months 
                                                                 to                 to 
                                                       30 September       30 September 
                                                               2021               2020 
                                                            GBP'000            GBP'000 
Earnings 
Profit after tax for purpose of basic and 
 diluted EPS                                                 25,356             21,825 
Adjustments (post tax): 
Add back cost of share-based payments on 
 preference shares                                              444                429 
Add back exceptional items - acquisition 
 related costs                                                2,262                  - 
Add back exceptional items - amortisation 
 of intangible assets                                           932                  - 
Add back exceptional items - fair value charge 
 on deferred consideration relating to business 
 acquisition                                                    686                  - 
Less net amount of deferred staff remuneration              (1,500)              (832) 
------------------------------------------------  -----------------  ----------------- 
Profit after tax for purpose of adjusted 
 basic and adjusted diluted EPS                              28,180             21,422 
------------------------------------------------  -----------------  ----------------- 
 
                                                        (Unaudited)        (Unaudited) 
                                                         Six months         Six months 
                                                                 to                 to 
                                                       30 September       30 September 
                                                               2021               2020 
                                                   Number of shares   Number of shares 
------------------------------------------------  -----------------  ----------------- 
Weighted average number of shares 
Weighted average number of ordinary shares, 
 excluding own shares, for purposes of basic 
 and adjusted basic EPS                                  95,743,599         93,307,573 
Effect of dilutive potential shares - share 
 options                                                  2,711,240          1,699,471 
Effect of preference shares crystallised 
 but not yet issued                                       1,783,134          2,083,263 
Weighted average number of ordinary shares, 
 for purpose of diluted and adjusted diluted 
 EPS                                                    100,237,973         97,090,307 
------------------------------------------------  -----------------  ----------------- 
 
 
 
                       (Unaudited)     (Unaudited) 
                        Six months      Six months 
                                to              to 
                      30 September    30 September 
                              2021            2020 
                             Pence           Pence 
-------------------  -------------  -------------- 
Earnings per share 
Basic                         26.5            23.4 
Diluted                       25.3            22.5 
Adjusted basic                29.4            23.0 
Adjusted diluted              28.1            22.1 
-------------------  -------------  -------------- 
 
   8.    Goodwill and intangible assets 

Goodwill relates to the acquisition of Dalton Capital (Holdings) Limited, the parent company of Dalton Strategic Partnership LLP (Dalton), a UK based boutique asset manager, which completed on 28 February 2021.

Intangible assets relate to investment management contracts acquired as part of the business combination with Dalton and the asset acquisition related to the International Value and World Value equity team from the Los Angeles based asset manager First Pacific Advisors LP (FPA). The net book value of these intangible assets as at 30 September 2021 were GBP10.9m and GBP9.1m respectively.

 
                                                 Investment 
                                                 management 
  (Unaudited)                         Goodwill    Contracts      Total 
                                       GBP'000      GBP'000    GBP'000 
----------------------------------  ----------  -----------  --------- 
Cost 
As at 1 April 2021                       6,770       18,647     25,417 
Re-measurement of goodwill(1)             (38)            -       (38) 
Revaluation(2)                               -        2,715      2,715 
----------------------------------  ----------  -----------  --------- 
As at 30 September 2021                  6,732       21,362     28,094 
----------------------------------  ----------  -----------  --------- 
Amortisation and impairment 
As at 1 April 2021                           -          419        419 
Amortisation for the period                  -          932        932 
Impairment for the period                    -            -          - 
----------------------------------  ----------  -----------  --------- 
As at 30 September 2021                      -        1,351      1,351 
----------------------------------  ----------  -----------  --------- 
Net book value as at 30 September 
 2021                                    6,732       20,011     26,743 
----------------------------------  ----------  -----------  --------- 
 
 
                                                  Investment 
                                                  management 
                                       Goodwill    Contracts      Total 
  Audited                               GBP'000      GBP'000    GBP'000 
-----------------------------------  ----------  -----------  --------- 
Cost 
As at 1 April 2020                            -            -          - 
Acquisition during the year               6,770       18,647     25,417 
-----------------------------------  ----------  -----------  --------- 
As at 31 March 2021                       6,770       18,647     25,417 
-----------------------------------  ----------  -----------  --------- 
Amortisation and impairment 
As at 1 April 2020                            -            -          - 
Amortisation for the year                     -          419        419 
Impairment for the year                       -            -          - 
-----------------------------------  ----------  -----------  --------- 
As at 31 March 2021                           -          419        419 
-----------------------------------  ----------  -----------  --------- 
Net book value as at 31 March 2021        6,770       18,228     24,998 
-----------------------------------  ----------  -----------  --------- 
 

1. The re-measurement of goodwill relates to the purchase price adjustment recognised in the current period.

2. Revaluation of intangible asset relates to investment management contracts acquired from FPA and is a result of the subsequent fair value measurement of the deferred consideration amount payable to FPA.

Goodwill is tested for impairment at least on an annual basis or more frequently when there are indications that goodwill may be impaired.

The Group has reviewed the investment management contracts related intangible assets as at 30 September 2021 and has concluded that there are no indicators of impairment.

   9.    Issued Share Capital 
 
                                                             (Audited) 
                                                (Unaudited)   31 March 
                                               30 September 
                                                       2021       2021 
Allotted, called up and fully paid:                 GBP'000    GBP'000 
--------------------------------------------  -------------  --------- 
100,113,855 ordinary shares of 2.5p each 
 (31 March 2021: 98,745,668 ordinary shares 
 of 2.5p each)                                        2,502      2,468 
--------------------------------------------  -------------  --------- 
 

During the period, Polar Capital Holdings plc has issued 34,266 shares on exercise of employee share options and 1,333,921 shares in connection with the crystallisation of manager preference shares.

10. Financial Instruments

The fair value of financial instruments that are traded in active markets at each reporting date is determined by reference to quoted market prices or dealer price quotation (bid price for long positions and ask price for short positions), without any deduction for transaction costs. For financial instruments not traded in an active market, such as forward exchange contracts, the fair value is determined using appropriate valuation techniques that take into account the terms and conditions and use observable market data, such as spot and forward rates, as inputs.

The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data.

 
                                          (Unaudited) 
                                       30 September 2021 
                          ------------------------------------------ 
                           Level 1    Level 2    Level 3     Total 
                            GBP'000    GBP'000    GBP'000    GBP'000 
                          ---------  ---------  ---------  --------- 
 Financial assets 
 Assets at FVTPL             71,451          -          -     71,451 
 Other financial assets           -        164          -        164 
                             71,451        164          -     71,615 
                          ---------  ---------  ---------  --------- 
 
 
 Financial Liabilities 
 Liabilities at FVTPL           5,543   -   17,225   22,768 
 Other financial liabilities      367   -        -      367 
                               ------      -------  ------- 
                                5,910   -   17,225   23,135 
                               ------      -------  ------- 
 
 
                                                (Audited) 
                                              31 March 2021 
                               ------------------------------------------ 
                                Level 1    Level 2    Level 3     Total 
                                 GBP'000    GBP'000    GBP'000    GBP'000 
                               ---------  ---------  ---------  --------- 
 Financial assets 
 Assets at FVTPL                  57,151          -          -     57,151 
 Other financial assets                -         84          -         84 
                                  57,151         84          -     57,235 
                               ---------  ---------  ---------  --------- 
 Financial Liabilities 
 Liabilities at FVTPL              6,328          -     14,054     20,382 
 Other financial liabilities       4,069          -          -      4,069 
                               ---------  ---------  ---------  --------- 
                                  10,397          -     14,054     24,451 
                               ---------  ---------  ---------  --------- 
 

During the period there were no transfers between levels in fair value measurements.

Movement in liabilities at FVTPL categorised as Level 3 during the year were:

 
 
                                              (Unaudited)   (Audited) 
                                             30 September    31 March 
                                                     2021        2021 
                                                  GBP'000     GBP'000 
------------------------------------------  -------------  ---------- 
At 1 April                                         14,054           - 
Additions                                               -      15,014 
Repayment                                           (363)       (517) 
Fair value movement                                 3,402           - 
Foreign currency revaluation loss/ (gain)             132       (443) 
------------------------------------------  -------------  ---------- 
At 30 September                                    17,225      14,054 
------------------------------------------  -------------  ---------- 
 

11. Notes to the Cash Flow Statement

Reconciliation of profit before taxation to cash generated from operations

 
 
                                                                           (Unaudited) 
                                                           (Unaudited)      Six months 
                                                            Six months              to 
                                                       to 30 September    30 September 
                                                                  2021            2020 
                                                               GBP'000         GBP'000 
----------------------------------------------------  ----------------  -------------- 
Cash flows from operating activities 
Profit on ordinary activities before tax                        31,722          27,041 
Adjustments for: 
Interest receivable and similar income                            (13)            (41) 
Investment income                                                (190)           (155) 
Interest on lease                                                   51              65 
Amortisation of intangible assets                                  932               - 
Depreciation of non-current property and equipment                 678             670 
Decrease/ (increase) in fair value of assets 
 at fair value through profit or loss                            2,001         (9,656) 
(Decrease)/ increase in other financial liabilities            (3,050)           3,311 
Increase in receivables                                        (3,697)        (15,302) 
Decrease in trade and other payables                           (7,433)         (2,059) 
Share-based payments                                             4,047           2,282 
(Decrease)/ increase in liabilities at fair 
 value through profit or loss                                  (1,004)             175 
Release of fund units held against deferred 
 remuneration                                                    2,971           (613) 
----------------------------------------------------  ----------------  -------------- 
Cash generated from operations                                  27,015           5,718 
----------------------------------------------------  ----------------  -------------- 
 

12. Related Party Transactions

Transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not included in this note. All related party transactions during the period are consistent with those disclosed in the Group's annual financial statements for the year ended 31 March 2021 and have taken place on an arm's length basis.

13. The Publication of Non-Statutory Accounts

The financial information contained in this unaudited interim report for the period to 30 September 2021 does not constitute statutory accounts as defined in s434 of the Companies Act 2006. The financial information for the six months ended 30 September 2021 and 2020 has not been audited. The information for the year ended 31 March 2021 has been extracted from the latest published audited accounts, which have been filed with the Registrar of Companies. The audited accounts filed with the Registrar of Companies contain a report of the independent auditor dated 30 June 2021. The report of the independent auditor on those financial statements contained no qualification or statement under s498 of the Companies Act 2006.

Shareholder Information

Directors

   David Lamb                                        Non-executive Chairman 
   Gavin Rochussen                             Chief Executive Officer 
   John Mansell                                     Executive Director 
   Jamie Cayzer-Colvin                         Non-executive Director 

Alexa Coates Non-executive Director, Chair of Audit and Risk Committee

Win Robbins Non-executive Director, Chair of Remuneration Committee

   Andrew Ross                                     Non-executive Director 
   Samir Ayub                                         Executive Director (appointed 17 November 2021) 

Laura Ahto Non-executive Director (appointed 17 November 2021)

Company No.

Registered in England and Wales

4235369

Registered Office

16 Palace Street

London, SW1E 5JD

Tel: 020 7227 2700

Group Company Secretary

Neil Taylor

Dividend

A first interim dividend of 14.0p per share has been declared for the year to 31 March 2022. This will be paid on 14 January 2022 to shareholders on the register on 24 December 2021. The shares will trade ex-dividend from 23 December 2021.

Remuneration Code

Disclosure of the Group's Remuneration Code will be made alongside its Pillar 3 disclosure which is available on the Company's website.

Half Year Report

Copies of this announcement and of the Half Year report will be available from the Secretary at the Registered Office, 16 Palace Street, London SW1E 5JD and from the Company's website at www.polarcapital.co.uk

Neither the contents of the Company's website nor the contents of any website accessible from the hyperlinks on the Company's website (or any other website) is incorporated into or forms part of this announcement .

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November 22, 2021 02:00 ET (07:00 GMT)

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