Interim Results

RNS Number : 0064I

Tavistock Investments PLC

23 March 2015

 

Tavistock Investments Plc

Unaudited interim results for the six months ended 31 December 2014

I am pleased to present the Company's unaudited results for the six month period to 31 December 2014 and to report that the Company has made significant progress both in the period under review and subsequently.

In my last report to shareholders, a copy of which was announced on 5 September 2014, I outlined our short-term objectives for the business. These were to ensure that Tavistock Wealth and Tavistock Partners operate together on an integrated basis, to progress toward profitable trading at the Group level and then to increase the scale and the geographic reach of the business. I am pleased to advise that all of these objectives have been achieved.

On 10 October, it was announced that Tavistock Wealth had developed and launched a discretionary fund management (DFM) service, predominantly for use by clients of the advisory business, Tavistock Partners, but also to be made available to selected third parties. This service included the provision of an extensive series of risk progressive model portfolios and to ensure choice in meeting the needs of each investor, many of the models are managed in conjunction with a panel of third party specialists.

Advisory clients were first made aware of the DFM service in early August and in the short period since, it has attracted some 1,600 investment clients and already manages more than £125 million on their behalf.  As a consequence of this rapid growth Tavistock Wealth is now trading profitably. More information about Tavistock Wealth is available on the company's website at www.tavistockwealth.com. 

Tavistock Partners, continues to trade profitably, as it has done consistently since its acquisition. More information about Tavistock Partners is available on the company's new website at www.tavistockpartners.com.

On 13 October 2014, the Company announced that it had made an initial grant of options under its recently established EMI Scheme. The Scheme had been established with the intention of providing a long term, tax efficient, incentive to retain and reward key staff within the business. The initial grant was made to certain directors and senior management to subscribe for, in aggregate, 8,300,000 new ordinary shares of 1p each in the Company ("Ordinary Shares") at a subscription price of 5.25p per share, being a price that had previously been agreed with HMRC.

As the EMI Scheme is a long term incentive program, with an effective life of 10 years, half of the options that were granted to each individual are exercisable after 3 years and the other half are exercisable after 5 years, and in both instances are subject to the continued employment of the individual within the Group.

In the months immediately following the period under review, the Company's unaudited management accounts indicated that the recently established integrated business had begun trading profitability at the Group level.

In February 2015 the Company announced that it had completed the acquisition of Standard Financial Group Limited ("SFG"), an IFA advisory business based near Cheltenham in Gloucestershire. In conjunction with the acquisition the Company raised a gross total, before costs, of £3,355,856 of additional working capital through the issue of 167,792,809 new ordinary shares of 1p each at a price of 2p per share and that as a consequence, the Company now has a total of 289,615,305 shares is issue.

Following this acquisition the Company has over 300 financial advisers and an estimated £3 billion of assets under advice. It currently also has some £2 million of available cash resources with which to fund its future development.

The Company subsequently announced a change in its accounting reference date from 31 December to 31 March of each year so as to align with that of its largest trading subsidiary, SFG.

Results for the period

The results, which are summarised below, reflect the extent to which the wider Group's costs exceeded the profits generated by Tavistock Partners throughout the period and the profits generated by Tavistock Wealth in the latter part of the period under review.

Reported revenues in the period were £2.25 million and the Company's loss before interest, depreciation and amortisation (EBITDA) was £165k. As at 31 December 2014, the Company had net assets of £7.75 million of which £170k was in cash. As a consequence of the share subscriptions and the placing completed in February 2015, the Company's cash resources were increased by some £3.35 million. These resources are considered to be sufficient for current needs.

Future objectives and prospects

SFG has historically operated a low margin business model that was solely dependent upon the scale of its network membership in order to achieve profitability. However, the business has recently been trading at a loss because of a fall in the number of network members. The Board's main objectives in the current year will be to integrate SFG's member firms into a restructured Group and to continue to develop synergies between our various trading subsidiaries.

Despite the fact that the current year might be characterised as being one of reorganisation and integration, the Company is now particularly well placed to capitalise on the opportunities that it has to further develop its business.

Consequently the Board will continue to pursue suitable acquisition opportunities and to grow the level of funds within Tavistock Wealth's centralised investment proposition.

I would like to thank all of our staff for their hard work and dedication since we began the "Tavistock journey" and I look forward to updating shareholders on the Company's further progress in due course.

Oliver Cooke

Executive Chairman

Consolidated Income Statement

For the six months ended 31 December 2014

Note	6 months to 31 December 2014 (unaudited)	6 months to 31 December 2013 (unaudited)
	£'000	£'000
Revenue                                                                         2
- Continuing operations	2,251	35
Cost of sales
- Continuing operations	(1,419)	(15)
Gross profit	832	20
Administrative expenses	(1,012)	(173)
Loss from Operations	(180)	(153)
Reconciliation of earnings before interest, depreciation and amortisation (EBITDA) to Loss from Operations - EBITDA - Depreciation	(165) (15)	(153) -
Loss on disposal of discontinued operations	-	(92)
Interest payable	-	(2)
Finance income	-	1
Transaction costs associated with business combination	(163)	-
Loss before and after tax and total comprehensive income for the year	(343)	(246)
Loss per New Ordinary Share (pence)
Basic	(0.28)p	(2.57)p

Consolidated Statement of Financial Position

As at 31 December 2014

Note	As at 31 December 2014 (unaudited)	As at 31 December 2013 (audited)
ASSETS	£'000	£'000
Non-current assets
Tangible fixed assets	31	-
Intangible assets                                                      4	9,627	-
	9,658	-
Current assets
Trade and other receivables	985	43
Cash and cash equivalents	170	324
	1,155	367
Total Assets	10,813	367
LIABILITIES
Non-current liabilities
Deferred Consideration	(2,222)	-
Term Loan	(250)
	(2,472)	-
Current liabilities
Trade and other payables	(371)	(5)
Accruals	(215)	(124)
	(586)	(129)
Total liabilities	(3,058)	(129)
Total assets less liabilities	7,755	238
Equity
Share capital	8,567	7,471
Share premium	18,800	11,887
Retained deficit	(19,612)	(19,120)
Total equity	7,755	238

Consolidated Cash Flow Statement

For the six months ended 31 December 2014

		6 months to 31 December 2014 (unaudited) £'000	6 months to 31 December 2013 (unaudited) £'000
Cash flows from operating activities
Loss from operations		(180)	(246)
Adjustments for:
Share based payments		23	(12)
Depreciation		15	(1)
Amortisation of intangible assets		-	(102)
Loss on disposal of discontinued operations		-	92
Finance Income		-	(1)
Cash flows from operating activities before changes in working capital		(142)	(270)
Increase in receivables		(297)	(107)
Increase/(decrease) in liabilities		119	(124)
Net cash used in from operating activities		(320)	(501)
Cash flows from investing activities
Finance Income		-	1
Net cash on acquisition of subsidiary		-	372
Capitalised R & D expenditure		-	31
Purchases of property, plant and equipment		(15)	-
Net cash (used in)/generated from investing activities		(15)	404
Cash flows from financing activities
Proceeds from issue of share capital		157	417
Net cash generated from financing activities		157	417
Net (decrease)/increase in cash and cash equivalents		(178)	320
Cash and cash equivalents at beginning of period		348	4
Cash and cash equivalents at end of period		170	324

Consolidated Statement of changes in equity

For the six months ended 31 December 2014

	Share capital	Share premium	Retained earnings	Merger reserve	Total
	£'000	£'000	£'000	£'000	£'000
As at 30 June 2013	7,394	11,547	(18,739)	(118)	84
Shares issued	77	340	-	-	417
Reserves transfer	-	-	(135)	118	(17)
Loss before tax and after tax and total comprehensive income	-	-	(246)	-	(246)
As at 31 December 2013	7,471	11,887	(19,120)	-	238
Shares issued	1,050	6,780	-	-	7,830
Loss before tax and after tax and total comprehensive income	-	-	(172)	-	(172)
As at 30 June 2014	8,521	18,667	(19,292)	-	7,896
Shares issued	46	133	-	-	179
Loss before tax and after tax and total comprehensive income	-	-	(343)	-	(343)
Share based payment	-	-	23	-	23
As at 31 December 2014	8,567	18,800	(19,612)	-	7,755

Notes to the Interim Results for the six months ended 31 December 2014

1. Basis of preparation

The Interim Results for the six months ended 31 December 2014 have been prepared and presented in accordance with IAS 34 'Interim Financial Reporting' as adopted by the European Union. They have been prepared on a going concern basis with reference to the accounting policies and methods of computation and presentation set out in the Group's consolidated financial statements for the period ended 31 December 2013, except as stated below.

The information in this announcement does not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. The Group's accounts for the year ended 31 December 2013 have been reported on by the Group's auditors and delivered to the Registrar of Companies. The report of the auditors, dated 12 May 2014 was unqualified.

The Income Statement for the six months ended 31 December 2013 is unaudited, whilst the balance sheet as at 31 December 2013 has been audited.

2. Segmental information

The Group provides financial advisory and investment management services in the UK.

All of the Group's assets are UK based.

3. Loss per Share

		6 months to 31 December 2014 (unaudited)	6 months to 31 December 2013 (unaudited)
	Loss per New Ordinary Share has been calculated as follows:
	Loss (£'000)	343	246
	Weighted average number of New Ordinary shares ('000s)	120,295	9,568
	Basic loss per New Ordinary Share	0.28p	2.57p

Loss per New Ordinary Share has been calculated using the weighted average number of shares in issue during the relevant financial periods, adjusted for the consolidation of shares in May 2014.  

4. Intangible Assets	Goodwill on	Capitalised	Intellectual
	Consolidation	Development	Property	Total
	£'000	£'000	£'000	£'000
Cost
Balance at 30 June 2013 Disposals	1,529 (1,529)	1,381 (1,381)	635 (635)	3,545 (3,545)
	-----------	--------------	-------------	-------------
Balance at 31 December 2013	-	-	-	-
Additions (see Note 5) Balance at 30 June 2014	9,899 ----------- 9,899 -----------	- ----------- - -----------	- ----------- - -----------	9,899 ------------ 9,899 ------------
Transaction costs	(272)	-	-	(272)
	-----------	-----------	-----------	-------------
Balance at 31 December 2014	9,627	-	-	9,627
	-----------	-----------	-----------	------------
Accumulated amortisation
Balance at 30 June 2013	1,529	824	635	2,988
Eliminated on disposal	(1,529)	(824)	(635)	(2,988)
	-----------	--------------	-------------	---------------
Balance at 31 December 2013 Provision for period Balance at 30 June 2014 and 31 December 2014	- - ------------ -	- - ------------- -	- - ------------- -	- - -------------- -
	------------	-------------	-------------	--------------
Net book value
At 30 June 2013	- ------------	557 -------------	- ------------	557 -------------
At 31 December 2013	-	-	-	-
	-------------	-------------	------------	------------
At 30 June 2014	9,899	-	-	9,899
	-------------	-------------	------------	------------
At 31 December 2014	9,627	-	-	9,627
	-------------	-------------	------------	------------

5. Share Capital

			31 December 2014	31 December 2013
			£'000	£'000
Called up share capital
Allotted, called up and fully paid
121,822,496 New Ordinary shares of 1p (31 December 2013 1,228,916,168 Ordinary Shares of 0.01 p)			1,218	122
10,000,000 Ordinary "A" shares of 0.01p			1	1
30,450,078 Deferred shares of 9p each			2,741	2,741
465,344,739 Deferred "A" shares of 0.99p			4,607	4,607
			-----------	-------------
			8,567	7,471
			-----------	-------------

In September 2014, the Company placed 4,533,334 New Ordinary shares of 1p each and as a consequence the Company had a total of 121,822,496 New Ordinary shares in issue at 31 December 2014.

6. Events after the balance sheet date

Significant events after the balance sheet date have been referred to in the Chairman's Statement.

For further information:

Tavistock Investments plc Oliver Cooke, Executive Chairman Brian Raven, Group Chief Executive	Tel: [phone]
Northland Capital Partners Limited William Vandyk Matthew Johnson	Tel: [phone]
WH Ireland Limited Tim Feather Mark Leonard	Tel: [phone] Tel: [phone]
Templars Communications Ltd Kitty Parry James Kimber	Tel: [phone]

 

END

 

 

IR VBLBLEXFEBBE