TIDMSJH
RNS Number : 0813H
St James House PLC
30 July 2021
30 July 2021
ST JAMES HOUSE PLC
("SJH", the "Group" or the "Company")
AGM Statement & Strategy Update
At the Company's annual general meeting ("AGM") to be held
today, Richard Shearer, the Company's recently appointed CEO, will
make the following AGM Statement and provide a Group Strategy
Update, as indicated in the announcement of the Company's annual
results on 27 July 2021.
AGM Statement
The Last Three Months
"I would like to introduce myself to shareholders and set some
out the stall for our plans going forward.
I have been conscious that I want to report on matters once they
are completed or at the very least contracted, so as to move away
from the forward-looking statements that formed a large part of the
Company's reporting methodology of the past. I hope this will go
some way to building a relationship with shareholders based on
defined and executable goals that engender trust in the
process.
The overarching philosophy is to build a corporate culture and
business model that allows for a well-run, tightly controlled
business that is able to be nimble and scalable at speed.
We have moved quickly over the past three months during which
the company has been undergoing a rigorous internal reorganisation.
I have been working hard with teams both internally and externally
to "right size" the Group, cut costs and to create a vision for the
future that builds on the foundations of both SJH and Tintra's
experiences in a way that creates shareholder value and builds a
model for the future.
To that end we produced an internal Positioning Document that
outlined a 90-day Change Management Process. This document included
a number of items, again internal and external that we have, for
the most part, completed. The result is that we now have a team
that is streamlined and a cost base that is rationalised, as
announced on 13 July 2021.
As you may have seen from earlier announcements, our starting
point was to undertake a deep dive of the business and see where
there was value and more importantly where there was not. This was
done with the goal of building a strong, efficient, cost-effective
foundation from which to grow. Any business is only as strong as
its weakest point, and as such we wanted to ensure that was where
we started.
We had no preconceptions at the start of that process; however,
it quickly became evident what needed to be done. To that end we
were able to cut the staffing overhead for a material saving. This
cost cutting took further form in the disposal of the legal claims
business. This business needed substantial new investment and even
with such investment its ability to scale was capped and we took
the view that it was a better private business than as part of our
public one.
We continue our analysis of the lottery business, which we
expect to finish during August 2021, at which time we will submit
options to the Board and announcements will be made that outline
the plans for that business unit.
We have done a lot of work to rationalise the business and
prepare it for growth. The process is not entirely complete, but it
is materially so, and the team will complete it within the next 4-6
weeks at which time further announcements will be made. I will now
outline of the future strategy of the Group, as announced earlier
today."
Strategy Update
The Future
"As we head into the AGM and we rebrand the Group, our minds are
strongly focused on the horizon and what shape the future may take.
The Company historically has perhaps lacked a clear, well-defined
vision.
I take the view that for success a company needs to identify a
need, articulate a mission, define success and have a strategy to
execute on these components. That is what we have done and will
continue to do.
Tintra Holdings has for many years been focused on servicing
emerging market UHNW families and corporates with their
cross-border investment needs, it is something that we have a deep
understanding of and over the past few months, we have been working
hard to fold that knowledge into SJH.
We have identified a gap in the market that in our view nobody
is filling sufficiently well, and we believe that we in turn are
well placed to win that space.
Over the past decade, trade and investment between emerging
markets and advanced economies have become largely borderless and
frictionless - the ability to make payments for that trade has
not.
We are developing a plan to build an emerging market focused
banking technology and infrastructure to enable financial
institutions, multinationals and large corporates in the emerging
world to access global banking infrastructure without bias or
prejudice in an environment where we control the compliance
exposure from end to end.
Competitors such as Revolut have filled this space domestically,
Wise PLC have achieved great things solving the problem from the
'west' to frontier markets. Nobody is solving the problem the other
way around in a meaningful way. We intend to fill in this gap.
An uneven playing field has grown where emerging market
businesses cannot get clear banking routes due to the lack of
understanding of their markets. Legacy banks' KYC/AML framework has
not kept pace with the emergence of new territories onto the global
financial scene.
A misguided methodology has developed in the space whereby
compliance teams don't understand what a 'good' compliance pack
looks like versus a 'bad' compliance pack. As a result, they label
entire jurisdictions as 'bad' - something that is clearly not
correct.
Over the past few years E-money & challenger banks have
grown to try to fill this void, but for the most part have become
very siloed and inward facing with limited jurisdictional
reach.
At Tintra we have been passionate about fighting this prejudice,
that derives simply from a lack of jurisdictional understanding,
for a long time and the aim with the payments business is to grow
this unit in a way that neutralizes these prejudices in a fashion
that nobody else is attempting and in doing so to achieve a
scalable business that has revenue streams from merchant services,
payments, foreign exchange and technology licensing.
We plan to do this by building our own banking infrastructure
that moves away from the concept of 'payments' and into building an
international banking infrastructure where we control the entire
end to end process.
E-money challengers are only as strong in a new vertical as
their banking partner; our strategy is to build deep infrastructure
that has best in class technology which includes e-money along with
banking licenses.
We have identified that there are many players in the market
that solve parts of the current needs and problems, but nowhere is
a holistic solution available. We have been watching this for a
couple of years and feel that now is the right time.
Tintra PLC will build regulation-first technology banking that
provides cross border banking services to large corporates and
multinationals in emerging market jurisdictions who have need to
access developed markets, either because that is the location of
their main HQ or that they have meaningful trade with the territory
in a way that they either cannot or find difficult in the current
status quo.
How we plan to do it
Our view is that the only way to solve this problem is to build
banking infrastructure that is compliance led, using a hub and
spoke system that will be able to provide frictionless banking for
major organisations in developing markets.
This is a big vision and one that will require funding,
dedication and a lot of hard work over the coming months and years.
We strongly believe we are building the right team to be able to
execute this.
A number of steps have been taken to assist us in the first part
of achieving that goal. We have engaged DLA Piper to act for the
Company as advisor, in the first instance, on the change management
process completion and to build a framework from which to scale
quickly and effectively.
We have further engaged Bruce Wallace, a chartered company
secretary focused on Public Companies, to act with building the
business best governance framework and to provide Company
Secretarial support going forward.
We have also engaged with OTC Markets to commence the process of
a reciprocal trading facility on the OTCQXB Venture Market in the
United States. This market is designed to allow developing
international companies to be publicly traded in the United States.
This is a cost-effective way for our Company to be able to provide
access to our stock to US investors.
Our strategy is to build a licence framework in key
jurisdictions. In the first instance it is our plan to obtain a FCA
Electronic Money Institution licence, either by application or
acquisition and have undertaken a deep dive analysis of the sector
in the United Kingdom. We expect to be announcing the results of
this process during September.
To begin the process of overseas growth in a strategic location
we have engaged Sharq Law Firm, one of Qatar's premier operators,
to begin the process of applying for a full banking licence in the
Qatar Financial Centre. We have already had a number of discussions
with the Qatar Financial Centre and have received interim
approvals. Our formal submission will be submitted in the next two
weeks. This process is expected take 10-12 months to complete.
We have also begun conversations in two other territories and
these will be announced to the market once we have matured those
discussions to a material point.
Tintra has committed funds to the business to date and will
continue to do so in the short term, but of course the above plans
require funding. To that end we are already speaking to a number of
partners around the world to articulate our plans and to budget a
potential fund raise over H2 2021.
We have been conscious to ensure that we are validating our
strategy as we move through this process and over the past two
months have been developing relationships with two major partners.
Should these reach a contractual stage, we will make a further
announcement, which will provide flows across all of the verticals
mentioned above and form the backbone of the growth strategy in the
early stages.
Our vision is strong, and our execution strategy is well
defined, but this is a big plan and is unlikely to be a straight
line of achievement. But the gap exists, and it is something we
have been market researching for a number of years, so we believe
we are the best placed team to execute on it. More announcements
will be forthcoming in the coming weeks."
For further information, contact:
St. James House PLC
Richard Shearer, CEO
Website www.sjhplc.com 020 3655 5000
Allenby Capital Limited
(Nomad, Financial Adviser & Broker)
John Depasquale / Nick Harriss / Vivek
Bhardwaj 020 3328 5656
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END
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