Interim Results

Begbies Traynor Group PLC 07 January 2005 RNS Release 7 January 2005 Begbies Traynor Group plc Interim results for the period ended 31 October 2004 Begbies Traynor Group plc, the UK's leading independent insolvency, corporate rescue and recovery specialist, announces interim results for the period ended 31 October 2004. Financial and business highlights: •Profit before tax of £570,000 (after goodwill amortisation of £879,000) for the six months, of which £342,000 is attributable to the pre-acquisition period •Turnover of £11 million •Earnings per share of 0.37 pence (before goodwill amortisation) for the one month following the creation of the Group •Estimated value of new work won up 35% on 2003 on a like-for-like basis •Intention to propose a maiden dividend at the full-year stage reconfirmed Ric Traynor, Executive Chairman, said: 'The Board is confident in the Group's ability to maintain growth and meet the challenge of doubling our market share by 2007 through sustained organic expansion and through acquisitions of smaller firms or teams. We are also planning to add new complementary services that will further enhance the Group's business service offerings.' Enquiries, please contact: Ric Traynor Neil Boom/Jenny Leahy Executive Chairman Gresham PR Ltd. Begbies Traynor Group plc 020 7404 9000 0161 839 0900 Chairman's statement Following the formation of Begbies Traynor Group plc and its flotation on the AIM market on 1 October last year, I am delighted to welcome our new shareholders and to present our first report. It is particularly pleasing that so many partners and staff from our offices around the country have joined us in ownership; the Members of the Board also have large stakes in the Company. This means that the focus of the Group's management is firmly on the safe growth of long-term shareholder value and the generation of cash to both fuel our business expansion and to deliver dividend returns to shareholders. The Board has resolved to pursue a progressive dividend policy for the future and has re-confirmed its intention to recommend a maiden dividend when we present our financial statements for the period up to our year end on 30 April 2005. Although, technically, the Group has only traded under the ownership of the Company for one month up to 31 October 2004, the Interim Statement includes a profit and loss account and cash flow statement covering the whole of the preceding six months to give shareholders more meaningful information and allow comparisons to be made now and in the future. As well as the major matter of bringing the Group into corporate ownership and our admission to AIM, the business has continued its development as the major independent corporate recovery specialist in Great Britain. We have maintained our leading position in the field of liquidations and increased our market share in other aspects of business rescue and recovery. Over the last six months, we have welcomed three new partners to the Group and we are in active discussions with a number of other individuals and firms. The activity level in the Group in the six months to 31 October 2004 was wholly in line with our expectations and we have achieved a record volume of new appointments; the estimated value of new work won in the period is up 35% on the same six months in 2003 on a like-for-like basis (i.e. excluding Nottingham, which was acquired in May 2004). Our newer offices, in Birmingham and Scotland, have shown particularly encouraging growth in this regard. Operating profit for the six months was £1.75 million, before finance charges and amortisation of goodwill, on billings of £11 million, which reflects the expected margin in the summer half-year, given the incidence of holiday down-time. Profit before tax (after goodwill amortisation of £879,000) was £570,000 for the six months, of which £342,000 is attributable to the pre-acquisition period. Earnings per share before goodwill amortisation, for the one month following the creation of the Group, were 0.37 pence. Looking forward, the Board remains confident of the out-turn for the full year and the prospects for 2004/2005. We are looking forward to the challenge of delivering our objective of sustained organic and acquisitive growth in our chosen specialist market and I look forward to reporting to shareholders again after our financial year end. Ric Traynor 7 January 2005 Begbies Traynor Group plc Group Profit and Loss Account 6 months ended 31 October 2004 Notes £'000 Group Turnover From 1 October 2004 2 2,220 Five months to 30 September 2004 8,785 --------- 11,005 Movement in the realisable value of work in progress 465 --------- Value of work done 11,470 Direct costs (8,607) Administrative expenses (1,192) Other operating income 88 --------- Operating profit before goodwill amortisation 1,757 Goodwill amortisation (879) --------- Total operating profit 878 Finance charges (308) Less pre-acquisition profits 3 (342) --------- Profit on ordinary activities before taxation 228 Tax on profits on ordinary activities 4 (89) --------- Profit on ordinary activities after taxation retained 139 ========= Basic earnings per share (pence) 5 0.21 Turnover & operating profit derived from continuing operations. There were no unrealised gains or losses in the period. Begbies Traynor Group plc Consolidated Balance Sheet As at 31 October 2004 £'000 Fixed Assets Goodwill on group formation 23,567 Goodwill on acquisitions 4,410 Intellectual property 187 --------- 28,164 Tangible fixed assets 2,157 --------- 30,321 --------- Current assets Work in progress at cost 5,602 Debtors 4,730 Cash at bank and in hand 2,131 --------- 12,463 Creditors: amounts falling due within one year (8,965) --------- Net Current Assets 3,498 --------- Total assets less current liabilities 33,819 Creditors: amounts falling due after more than one year (8,482) --------- Net Assets 25,337 ========= Capital and reserves Called up share capital 3,271 Share premium account 21,927 Profit and loss account 139 --------- 25,337 ========= Begbies Traynor Group plc Group Cash Flow Statement 6 months to 31 October 2004 £'000 Total operating profit 878 Depreciation of tangible fixed assets 369 Amortisation of goodwill 879 Profit on sales of fixed assets (7) --------- EBITDA 2,119 Increase in work in progress (298) Increase in debtors (1,390) Increase in creditors 474 --------- Cash inflow from operating activities 905 Servicing of finance - net finance charges paid (291) Capital expenditure (1,379) Proceeds of fixed asset sales 633 Former partners' current accounts drawn (1,655) Acquisitions (1,581) --------- (3,368) Financing Proceeds of share issues 5,032 Asset finance raised 609 --------- Movement in net cash 2,273 Net debt at beginning of the period (5,087) --------- Net debt at 31 October 2004 (2,815) ========= Cash at bank and in hand 2,131 Amount drawn on bank facility (4,946) --------- (2,815) ========= The bank facility totals £10m and the amount drawn thereon is shown within creditors falling due after more than one year. Begbies Traynor Group plc Movement in shareholders' funds 6 months to 31 October 2004 £'000 £'000 Profit on ordinary activities after taxation 139 Ordinary share capital issued Subscriptions on flotation 5,503 Less flotation costs (471) 5,032 ------- Share issues on group accretion Acquisition of corporate interests 18,666 Acquisition of personal interests 1,500 20,166 ------- ------- Total movement on shareholders' funds 25,337 ======= Begbies Traynor Group plc Interim Financial Statement 31 October 2004 Notes to the Interim Statement 1. Status of the Interim Results The interim figures are unaudited. The financial information set out in these financial statements does not comprise full accounts within the meaning of s240 of the Companies Act 1985. Profit and Loss and Cash Flow figures are shown for the underlying Group for the full six months to 31 October 2004. 2. Accounting Policies The financial information included in this statement has been compiled under the accounting policies set out in the Prospectus of the Company, dated 28 September 2004, save that Group turnover does not include disbursements recharged on cases. 3. Pre-acquisition Profits Profits up to 30 September 2004, which accrued to the former owners of firms in the Group, have been deducted in arriving at the profit before taxation of the Group in this financial statement. Any tax liability relating to those profits is the responsibility of those former owners. 4. Taxation The taxation charge is based on the estimated effective tax rate for a full year of 32% and takes credit (at 30%) for allowable goodwill amortisation. 5. Earnings per Share Basic earnings per share are calculated by dividing the profit attributable to ordinary shareholders of £139,000 by 65,424,580, the number of ordinary shares in issue from 1 October 2004. Adjusted earnings per share, adding back the effect of goodwill amortisation, for the one month period to 31 October 2004 were 0.37 pence. This information is provided by RNS The company news service from the London Stock Exchange

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