Final Results

W.H. Ireland Group PLC 29 February 2008 WHI WH IRELAND GROUP PLC ('WH Ireland' or 'the Group') Preliminary Results for the year ended 30 November 2007 Quoted on AIM, WH Ireland is an established financial services group with four distinct activities, stockbroking, corporate finance, financial services and investments. Highlights • Group turnover increased by 41% to £42.73m (2006: £30.34m) • Profit before tax of £3.80m (2006 restated: £3.67m) • Basic earnings per share of 14.89p (2006 restated: 14.78p) • Net assets of 114.3p per share (2006 restated: 94.6p) - newly refurbished head office property revalued at £8.25m (November 2006: £4.93m) • Final dividend of 3.0p (2006: 3.0p), making a total dividend for the year of 5.0p (2006: 4.4375p) • Particularly strong contribution from Australian business - further increased stake in the business to 76.59% this year • Further growth in stockbroking - addition of two new fund management teams - substantial new office opened in Bristol • Total funds under management and control of £1.77bn (2006: £1.36bn) - WH Ireland UK Growth Trust grown to £88m • Acquisition of IFA businesses in Bristol for initial consideration of £1.25m Commenting on results, Chief Executive, Laurie Beevers, said, 'These results are encouraging, especially when viewed against the backdrop of market turbulence. During the year, we have undergone a period of substantial change and strengthening of the Group and, as a result of continuing investment, we have expanded the scope and intrinsic value of our business, the full benefits of which will come through in the future. 'Our diversified approach is aimed at de-risking the Group, where possible, and our strong balance sheet gives us the confidence to continue to develop all facets of the business, both in the UK and Australia.' Laurie Beevers Tel: 020 7448 1000 (today) WH Ireland Tel: 0161 832 6644 Zoe Biddick Tel: 020 7448 1000 Biddicks Tom Durie Tel: 020 7710 7600 Oriel Securities Limited CHAIRMAN'S STATEMENT Results and Dividend Despite a tougher trading environment for the second half of the year, it is pleasing to report the fifth consecutive year of pre tax profits growth for the Group. The figures encompass a period of substantial change and strengthening of the Group; principally the focused move towards fund management within the stockbroking business which has led to an increase of 30% in funds under management to £1.77 billion (2006: £1.36 billion) and the revaluation to £8.25 million of the Manchester property following a major refurbishment, representing a rise of 67%. Our Net Asset Value has increased to £19.66 million (2006 restated: £15.37 million), up 27%. Turnover rose 41% to £42.73 million (2006: £30.34 million). Our pre tax profits have shown a more modest increase to £3.80 million (2006 restated: £3.68 million) with EPS of 14.89p (2006 restated: 14.78p). Investment across the business both in the addition of new client advisers and the implementation of new systems, and an increased regulatory burden has held back significant profit progress. Therefore, despite a substantial increase in both turnover and funds under management and control which will underpin future development, pre tax profit saw a modest increase on the previous year. However, as a result of continuing investment in and expansion of our business, we have considerably increased both its scope and intrinsic value, the full benefits of which will come through in future years. The make up of these operating profits reflects our growing spread of activities and our diversified investment portfolio. Our profits now, on a regular basis, derive from a blend of stockbroking, corporate finance, investment management, investment banking and our associated companies. We aim to achieve the best possible return from all our activities, but inevitably, with these diversified sources of income, from year to year, the mix of profits may well vary quite significantly. The carried interest costs (of £1,134,782) are included in administrative expenses. The associated profits of these transactions are shown below the operating profit line. In previous years the Group took advantage of true and fair override of the Companies Act to net off costs against revaluation gains on investments to eliminate this charge from administrative expenses. The Group has grown very significantly over the last ten years and especially during the seven years we have been a public company. We have taken the opportunity during those years, not only to increase our dividends substantially but also to increase and broaden the net asset base of the company which has grown from £1.90 million when we joined AIM in August 2000 to £19.66 million at the year end. We are proposing a final dividend of 3p per share, making a total dividend of 5p for the year as a whole (2006: 4.4375p) +12.7% which is covered nearly 3 times by earnings. The dividend will be paid on 25 April 2008 to holders on the register on 7 March 2008. As in the last few years, a scrip dividend alternative will be available. Trading Stockbroking has seen significant fluctuations during the year with a very strong first half. This was followed by a more subdued second half of the year when the impact of a variety of factors - principally the difficulties in America resulting from reckless lending in the sub-prime property market, negatively impacted on UK, European and North American equity markets. Our corporate finance division has continued to perform well with more work being undertaken for our existing clients as our portfolio has grown. Our 78 AIM clients provide a level of retainer income which underpins the department's performance. Our business in Australia continues to perform well and had an excellent year. We have great confidence in the management team there, and have increased our shareholding further to 76.59% of the equity, the remainder being largely held by Directors and outside investors. This has proved a worthwhile merger for both parties and we congratulate our colleagues once again on their results. Our financial services business has continued to grow and made an acquisition in the last few weeks of the financial year in Bristol. Our stockbroking and financial services activities in Cardiff now share one office. The year has seen increased sales but the development of further infrastructure, including significantly higher compliance costs, has meant that profits in this division were lower than in the previous year, although steps have been taken which we believe will lead to an improved performance in this area during the coming year given a reasonable trading environment. Systems are a major feature of modern investment management and we continue to upgrade the quality of our systems with the move to a new back office infrastructure now being complete. Our accounting platform has also been upgraded which will give us faster delivery of accurate client and management information. The introduction of further regulations and accounting changes including MIFID, CRD and ICAAP have significantly added to the workload of our compliance and finance departments. The implementation costs of compliance procedures and regulation generally has continued to rise with ever more demands being made by regulators in their endeavour to create a risk free world. We believe we always treat our customers fairly - a commitment which is engrained in our ethos and culture and which permeates throughout the firm. We strongly support the need for supervision and regulation in our industry, but the costs cannot be underestimated. Strategy We have a clearly developed strategy to continue to grow the business. We believe that we should play to our strengths and develop the business in areas of financial services which we understand and which can provide a profitable return. We also believe in maintaining a number of profit streams to provide greater stability when markets fluctuate. That spread of interests does not mean we cannot move quickly to exploit opportunities in the market where these open up, as is shown by our successful development of our position on AIM and our investment in Australia. We believe that, for a company of our size operating in markets which can be volatile, a broadly based business supported by strong asset backing is the best way forward. Investments As previously mentioned, the single most significant balance sheet investment is that of our head office building in the centre of Manchester. Following our substantial refurbishment of the building, it was professionally revalued in September at £8.25 million, an uplift of £3.32 million, including the cost of refurbishment of £1.43 million. Board I would like to thank my colleagues on the Board for their hard work and good counsel as always. I would also like to thank all our loyal staff who have endured the upheaval due to system changes, increased volumes and office moves with good grace and their usual commitment to the job. During the year our Finance Director, Derek Ashford, resigned to start his own private, accountancy practice and we wish him well and thank him for his contribution. We have further strengthened the finance department and we intend to make a replacement in that role in due course. As you will be aware we have had a number of approaches from various parties to merge with or make an offer for our business. These discussions were largely preliminary in nature and have not been progressed as was announced on 8 February 2008. We remain committed to enhancing shareholders value. Outlook The outlook for all companies in the financial services industry is uncertain and, while stockbroking volumes in the first two months are ahead of last year, February has been a touch disappointing. Our continued profit performance will depend on activity, particularly on AIM, and in the first three months of our year our level of transactions has held up well. Meanwhile, we have established strong foundations for the future, with good people and a strong balance sheet which should enable us to take advantage of opportunities for the ongoing development of our business. Sir David Trippier RD JP DL MSI Chairman CHIEF EXECUTIVE'S REPORT The year under review has seen a repeat of the previous year's pattern, namely a good first six months followed by a much tougher second half. Clearly the emergence of the credit crunch issues resulting from the uncertainty surrounding sub-prime bank exposure initially in the US and the UK market in late August, eroded confidence in the latter part of our year. This resulted in considerable volatility and led to very demanding stockmarket conditions. It is against this background that these results and the ongoing prospects for the development of the business need to be viewed. Stockbroking and Investment Management Stockbroking remains the largest activity within the Group, accounting for over half of our turnover. It has seen further growth over the past 12 months with the integration of two fund management teams; one in London, the other in Manchester. It is very much part of our strategy to further strengthen the fund management area of our business. This expansion has resulted initially in additional costs but should lead to improved quality of earnings in the medium term. We are always looking for opportunities to grow our stockbroking presence. At the same time we remain alert to the need to rationalise our costs, where appropriate. Our national office network continues to evolve, we have opened a substantial office in the centre of Bristol and closed our small Blackburn office, relocating the business to, and thereby expanding, our existing office in Lancaster. In addition to these developments, we have relocated both our Birmingham and Leeds offices into significantly improved and refurbished new premises. The WH Ireland UK Growth Trust, launched in July 2006, has achieved an excellent performance and has now grown to £88m in size. Since the period close, we have announced our intention, subject to market conditions, to launch a complementary fund, the WH Ireland Income Plus unit trust, in the current financial year. DJ Carmichael Pty Ltd, the subsidiary of WHI Australia Pty, has had a very good year making a significant contribution to the group, aided to some degree by the ongoing boom in the commodity sector, in which they have particular strength. Corporate Finance Corporate Finance has had another highly successful year, completing 11 AIM IPOs, 17 secondary fundraisings and one advisory transaction, raising a total of £116 million for our corporate clients. We remain one of the leading Nominated Advisers in terms of number of corporate clients and it is pleasing to report that the total of annual retainers which we currently receive comfortably exceeds our basic employment costs in this area. In order to develop our client service and bearing in mind the recent AIM rule changes, we have continued to increase our staffing levels, principally in London and Manchester. We have highly qualified teams in our four corporate finance locations in London, Manchester, Birmingham and Leeds and all offices continue to have a good workload. Financial Services Financial Services has had a somewhat quiet year as we continue to transition the business from a model of earning upfront fees to one of creating recurring revenue. However, as with the other parts of our business, we are keen to expand when opportunities arise and this was amply reflected with the purchase in October for an initial consideration of £1.25 million of two private financial advisory businesses with strong recurring income streams. Based to the north of Bristol, they further increase our presence in the South-West. Investments Our portfolio of listed and unlisted investments held by WH Ireland and DJ Carmichael has had another highly satisfactory year during which we have crystallised a number of gains. As reported previously, we have substantially refurbished our head office property in the centre of Manchester to a high standard, including new entrance, lifts, shopfronts with air conditioning throughout. Of the five floors, WH Ireland occupies three; the first floor having been fully let with a good covenant, leaving only the ground floor still to be occupied. Discussions are ongoing with various potential tenants. During the year we further increased to 24.67% our shareholding in Ultimate Finance Group plc, an AIM quoted company specialising in invoice discounting and factoring. Due to the investment in the Manchester refurbishment, the Bristol IFA purchase and working capital requirements in the normal course of our business, our year end cash resources are lower than last year's November figure. Our total net asset value (before minority interests) was £19.30 million, equivalent to 112.2p per share (2006 restated: 91.6p). Outlook Market conditions, as I have already stated, deteriorated during the second half of our year and we are yet to see signs of a significant or sustained recovery. Current economic forecasts suggest that the year will prove testing in many respects but our corporate finance operation continues to be active. Our diversified approach is aimed at de-risking the business, where possible, and our strong balance sheet gives us the confidence to continue to develop all facets of the business, both in the UK and Australia. Laurie Beevers Chief Executive Consolidated Profit and Loss Account for the Year Ended 30 November 2007 Year ended Restated Year ended 30 November 30 November 2007 2006 Note £ £ Group turnover Continuing operations 42,685,210 29,645,609 Acquisitions 42,201 695,787 2 42,727,411 30,341,396 Administrative expenses* (41,625,921) (28,248,776) Group operating profit Continuing operations 1,088,150 2,696,286 Acquisitions 13,340 (603,666) 1,101,490 2,092,620 Share of operating profit before tax in Associates 157,609 210,503 Total operating profit: Group and share of Associates 1,259,099 2,303,123 Profit on disposal of fixed assets 34,099 10,463 Profit on disposal of investments 7 1,360,531 1,257,809 Fair value gains on investments 7 1,004,222 - Amounts written off investments 7 (46,061) (25,544) Income from investments 35,984 31,775 3,647,874 3,577,626 Other interest receivable and similar income 751,859 516,461 Interest payable and similar charges (595,580) (421,978) Profit on ordinary activities before taxation 3,804,153 3,672,109 Tax on profit on ordinary activities 3 (1,222,581) (1,228,034) Profit on ordinary activities after taxation 2,581,572 2,444,075 Minority interest (113,754) (60,149) Profit for the financial year 2,467,818 2,383,926 Earnings per share restated Basic 5 14.89p 14.78p Diluted 5 13.56p 13.36p * The Carried Interest Bonus costs of £1,134,781 are provided in administrative expenses. In previous years, the Company took advantage of the true and fair override to offset revaluation gains on investments and eliminated this charge from administrative expenses. Consolidated Statement of Total Recognised Gains and Losses for the Year Ended 30 November 2007 Year ended Restated* Year ended 30 November 30 November 2007 2006 Note £ £ Profit for the financial year 2,467,818 2,383,9261 Unrealised gain on revaluation of properties 7 1,898,983 - Net loss from changes in fair value of available for sale 7 (1,736,466) - investments Unrealised surplus on revaluation of fixed asset - 548,886 investments Profit on disposal transferred to income during the (400,855) - period Taxation on current year's realised surplus on - (625,535) revaluation of fixed assets Currency translation differences 164,137 (127,184) Total recognised gain for the year 2,393,617 2,180,093 Prior year adjustment (note 1) 82,573(2) Total 2,476,190 1. After having deducted £37,030 for the additional FRS 20 expense in the year and the net credit impact of £48,457 relating to changes in accounting policies of the treatment of put call options in WHIA. 2. The cumulative additional FRS 20 expense in respect of prior periods, net of deferred tax. Note Of Historical Cost Profits And Losses For the Year Ended 30 November 2007 Year ended Restated* Year ended 30 November 30 November 2007 2006 Note £ £ Reported profit on ordinary activities before tax 3,804,153 3,672,109 Unrealised fair value movements 7 (1,004,222) - Realisation of investment revaluation gains - 2,084,321 Historical cost profit on ordinary activities before 2,799,931 5,756,430 taxation Historical cost profit retained for the year after the 1,577,350 4,528,396 provisions for taxation and minority interest * See Note 1 Consolidated Balance Sheet as at 30 November 2007 2007 2007 Restated* Restated* 2006 2006 Note £ £ £ £ Fixed assets Intangible assets 4,474,639 3,509,706 Negative goodwill (143,716) (143,204) 4,330,923 3,366,502 Tangible assets 9,790,378 6,105,899 Investments - Investments 7 5,690,456 4,767,838 - Investments in Associates 945,648 837,191 6,636,104 5,605,029 20,757,405 15,077,430 Current assets Debtors 99,875,349 76,387,142 Investments - 11,268 Cash at bank and in hand 8,001,885 14,819,199 107,877,234 91,217,609 Creditors: amounts falling due within one year (102,883,028) (85,337,320) Net current assets 4,994,206 5,880,289 Total assets less current liabilities 25,751,611 20,957,719 Creditors: amounts falling due after more than (5,955,057) (5,574,115) one year Provisions for liabilities and charges (136,349) (16,980) Net assets 19,660,205 15,366,624 Consolidated Balance Sheet (cont.) as at 30 November 2007 2007 Restated* 2006 Note £ £ Capital and reserves Called up share capital 860,046 812,017 Share premium account 2,613,325 1,785,965 Capital redemption reserve 228,083 228,083 Merger reserve 490,511 490,511 Other reserves 753,704 753,704 Revaluation reserve 2,565,953 2,844,042 Available for sale reserve 851,422 - Profit and loss account 11,223,170 8,043,886 Treasury shares (286,963) (86,561) Equity shareholders' funds 19,299,251 14,871,647 Minority interest (all equity) 360,954 494,977 Total capital employed 19,660,205 15,366,624 Consolidated Cash Flow Statement for the Year Ended 30 November 2007 Year ended Restated Year ended 30 November 30 November 2007 2006 £ £ Net cash (outflow) / inflow from operating activities (2,796,045) 7,263,974 Returns on investments and servicing of finance 352,914 261,868 Taxation (2,707,277) (857,762) Capital expenditure and financial investment (647,367) 2,762,903 Acquisitions and disposals (1,506,766) (616,836) Equity dividends paid (583,790) (479,465) Cash (outflow) / inflow before financing (7,888,331) 8,334,682 Financing 112,780 (870,031) (Decrease) / Increase in cash in the year (7,775,551) 7,464,651 Analysis of Net Cash Other At beginning Cash non-cash Exchange At end of year Flow changes movements of year £ £ £ £ £ Cash at bank and in hand 14,819,199 (6,873,791) - 56,477 8,001,885 Overdrafts (46,199) (901,760) - - (947,959) 14,773,000 (7,775,551) - 56,477 7,053,926 Debt due within one year (314,727) 66,448 (287,760) (5,473) (541,512) Debt due after one year (3,594,718) - 287,760 - (3,306,958) Finance leases (3,887) 3,887 - - - Total 10,859,668 (7,705,216) - 51,004 3,205,456 Reconciliation of Movement in Equity Shareholders' Funds for the Year Ended 30 November 2007 Group Company 2007 Restated* 2007 Restated * 2006 2006 £ £ £ £ Profit/(loss) for the financial year before dividends 2,467,818 2,372,177 (343,724) 597,250 Dividend - restatement adjustment - (400,410) - (400,410) Dividend - current year - (233,084) - (233,084) Put call option adjustment - 5,713 - - Restated profit/(loss) for the financial year 2,467,818 1,744,396 (343,724) (36,244) Dividend - final (488,490) - (488,490) - Dividends - interim (337,173) - (337,173) - Share based payment 39,715 37,030 39,715 37,030 Restatement adjustment - FRS 26 relating to available for 2,144,948 - - - sale equity shares (Deficit) /Surplus on available for sale reserve (1,736,466) 548,886 (196,091) (56,964) Transfer of revaluation from available for sale reserve on (400,855) - disposal Surplus on property revaluation reserve 1,898,983 - - - Tax in respect of current year realised surplus on - (625,535) - - revaluation Issued share capital 48,030 - 48,030 - Shares issued in payment of scrip dividends in the year 232,497 153,866 232,497 153,866 Shares issued on acquisition of subsidiary undertaking 243,056 - 243,056 - Shares issued on exercise of options 351,807 85,652 351,807 85,652 Shares bought back for cancellation - (45,250) - (45,250) Treasury shares acquired (200,402) (86,561) (200,402) (86,561) Exchange rate adjustments 164,136 (127,184) - - Increase in shareholders' funds during the year 4,427,604 1,685,300 (650,775) 51,529 Opening equity shareholders' funds 14,871,647 13,186,347 4,603,902 4,552,373 Restatement adjustment - FRS 26 relating to assets at fair 1,333,277 - 219,394 - value through the profit and loss account Restatement adjustment - FRS 26 relating to assets at fair (1,333,277) - (219,394) - value through the profit and loss account Closing equity shareholders' funds 19,299,251 14,871,647 3,953,127 4,603,902 1. Accounting policies The Group has maintained consistent accounting policies in the preparation of this preliminary announcement except as noted below. During the year the Group adopted the following new standards for the first time: • FRS 20 'Share-based payments'; • FRS 23 'The Effects of Changes in Foreign Exchange Rates', and; • FRS 26 'Financial Instruments: Recognition and Measurement'. The figures for the year ended 30 November 2006 have been restated to comply with FRS 20 as if the policy had been adopted throughout the year. Impact of the new standards • FRS 20 'Share-based payments' - Following a restatement of the comparative figures to include amendments required to reflect the impact of FRS 20, the profits for the year months ended 30 November 2006 have been reduced by a charge of £37,030. A total of £82,573 is shown in the statement of total recognised gains and losses being the total of the FRS 20 charge for the year ended 30 November 2006 of £37,030 and £45,543 as the total of the FRS 20 charge for previous periods. As the awards are all equity-settled, a corresponding credit arises directly in equity and the restatement has no effect on retained profits. A charge of £39,715 has been made in this year's profit to reflect the charge for the year ended 30 November 2007. • FRS 23 'The Effects of Changes in Foreign Exchange Rates' - The Group is required to adopt FRS 23 from the date it adopts FRS 26. No material impact arose on adoption, including on translation of the Group's Australian subsidiary. • FRS 26 'Financial Instruments: Recognition and Measurement' - The Group has taken advantage of the exemption available not to restate comparative amounts. As a result, the effect of the implementation of FRS 26 on the accounts is to adjust opening reserves by a transfer of £1,333,277 from revaluation reserve to retained profits in relation to financial assets now at fair value through the profit and loss account but previously revalued through the statement of total recognised gains and losses. The revaluation gains and losses have been recognised in the available for sale reserve. Additionally, a transfer of £2,177,072 has been made from revaluation reserves to available for sale reserve and an adjustment of £2,144,948 has been made to the available for sale reserve to reflect the increase in value of assets available for sale to their fair value as at 30 November 2006. • In the current year, the profit and loss account includes a gain of £1,004,222 for the increase in fair value of financial assets held at fair value through profit and loss and the revaluation reserve has been reduced by £1,736,466 relating to the decrease in fair value for the period of assets classified as available for sale. The carried interest bonus charge to administration expenses was £1,134,781. Put Call Option In addition the Group has revised its treatment of the options outstanding over minority share interests in WH Ireland Australia Pty Ltd. As part of the Group's acquisition of a majority stake in DJ Carmichael (part of WHI Australia), 51% interest being acquired in June 2005, there is an option for minority shareholders to put a proportion of their shares to the Group in a future period (31 March 2009 to 30 September 2009). The amounts which can be put to the Group under these options vary depending on other purchases of shares made by the Group but at 30 November 2007 represent 12% of the share capital of DJ Carmichael (2006: 23%). Additionally, the Group has a call option over the full minority interest. In combination with the put options, the call option has the effect of creating a forward purchase agreement over the element of shares covered by the put options. The consideration payable under these options is formula driven but considered by the Directors as equating to market value of those shares at the point of exercise. Previously, this resulting obligation to the minority shareholders was disclosed in the in the financial statements with no financial entries posted within the accounts. In the light of emerging accounting practice the Group has amended its accounting policy in respect of these put option to account for this as contingent consideration from the date of the original acquisition, with corresponding adjustments to goodwill. Under this revised accounting policy the Group consolidates a higher proportion of the results of DJ Carmichael to reflect the higher ownership which would arise if, as is considered likely by the Directors, these put-options are exercised. Consequently, the minority interest reserve has been reduced. The impact on the profit after tax is minimal, however, there is a reduction in the profit previously attributable to the minority interests, which is now attributable to the Group. The effects of the changes in the reported Group financial statements for 2006 are tabulated below. 1 December 30 November 2005 2006 Balance Sheet £ £ Decrease / (increase) in negative goodwill (see Note 13) 43,492 (110,141) Increase in liabilities for put call options (647,112) (379,123) Decrease in minority interest 603,620 494,976 Increase in reserves - (5,712) As a result of these changes, the related balances within the 2006 comparative figures have been restated. Financial Instruments As noted above, the Group has elected to apply FRS 26 from 1 December 2006 and in accordance with the exemption available in the standard has not restated comparative information. The Company has elected to classify its financial assets under the following headings: Quoted and unquoted equity shares - Equity investments, other than those in subsidiary undertakings and those equities which form part of the carried interest scheme (see below), that are held for an indefinite period of time are categorised as available for sale financial assets. These are measured at fair value at each reporting date with gains and losses on revaluation taken to the available for sale reserve through the statement of total recognised gains and losses, with the exception of a number of unlisted investments which are held at cost as no reliable fair values are available. In the case of listed investments, the fair value represents the quoted bid price of the investment at the balance sheet date. The fair value of unlisted investments is estimated by reference to recent arm's length transactions. When available for sale financial assets are derecognised, the cumulative gain or loss previously recognised in the statement of total recognised gains and losses is recycled to the profit and loss account. Warrants and those equities which form part of the carried interest scheme (see note below) - these are classified as financial assets held at fair value through the profit and loss account and are measured at fair value at each reporting date with all gains and losses credited or charged to the profit and loss account as appropriate. In the case of warrants, the fair value is estimated using established valuation models. Loans and receivables - trade receivables are measured on initial recognition at fair value. An appropriate provision for irrecoverable amounts is recognised in the profit and loss account where there is objective evidence that the asset is impaired. Carried Interest Bonus Scheme The Group provides for bonuses payable under the Carried Interest Bonus Scheme under which bonuses may be payable to certain corporate finance personnel when certain warrants or shares acquired as part of a corporate finance transaction are ultimately sold at a profit. For 2007, these costs (£1,134,781) have been debited to administrative expenses. During 2006, in order to show a true and fair view of the Carried Interest Bonus Scheme the Directors departed from the prescribed accounting treatment and off-set revaluation gains on investments to eliminate this charge. 2. Segmental reporting a) By geographical location UK Australia Total 30 November 2007 £ £ £ Turnover 32,655,130 10,072,281 42,727,411 Results - profit before interest and tax 2,232,692 1,415,182 3,647,874 Net assets 16,044,723 3,615,482 19,660,205 UK Australia Total 30 November 2006 £ £ £ Turnover 24,382,031 5,959,365 30,341,396 Restated Results - profit before interest and tax 3,118,141 459,485 3,577,626 Restated net assets 12,757,819 2,608,805 15,366,624 b) Turnover by activity 30 November 30 November 2007 2006 £ £ Stockbroking 29,019,071 19,838,727 Corporate finance 11,810,361 8,348,001 Financial services 1,863,697 2,099,192 Other 34,282 55,476 Total 42,727,411 30,341,396 No analysis of operating profit and net assets has been given by activity as all expenses, assets and liabilities relate jointly to these segments. Any allocation of these items would be arbitrary. 3. TAXATION The tax charged to the profit and loss of £1,222,581 represents a tax charge of 32.14% (2006 restated: £1,228,034 and 33.44%). 4. DIVIDEND A final dividend for the year ended 30 November 2006 totalling £488,490 was satisfied by the payment in cash of £340,271 paid on 7 April 2007. On the same day 122,386 new ordinary shares of 5p each were issued at 121.1p per share in relation to the scrip dividend alternative. An interim dividend for the year ended 30 November 2007 totalling £377,173 was satisfied by the payment in cash of £283,389 paid on 11 August 2007. On the same day 63,369 new ordinary shares of 5p each were issued at 148p per share in relation to the scrip dividend alternative. 5. Earnings per share Year ended Restated Year ended 30 November 30 November 2007 2006 Profit for the year used for the basic calculation £2,467,818 £2,383,926 Weighted average number of shares used in the basic calculation 16,573,548 16,124,635 Weighted average number of options outstanding for the period 1,619,354 1,715,123 Weighted average number of shares used in the diluted calculations 18,192,902 17,839,758 6. INVESTMENT IN SUBSIDIARY UNDERTAKINGS During the year the Group's holding in WHI Australia Pty Ltd was increased by a further 16.65% for a total consideration of £344,715, taking the Group's holding to 76.59%. The acquisition gave rise to negative goodwill of £135,916. During the year the Group bought the incorporated companies of ARE Business and Professional Limited, SRS Business and Professional Ltd and the assets and liabilities of the unincorporated business of Robbie East for a total consideration of £1,250,040 being £1,000,039 cash and £250,001 of WH Ireland Group plc shares. 7. Investments Unquoted Quoted investments Warrants investments Total Group (excluding investments in £ £ £ £ Associates) Cost or valuation At beginning of year (as previously 350,071 2,013,373 2,404,394 4,767,838 stated) Restatement adjustment - FRS 26 relating 2,144,948 -- -- 2,144,948 to available for sale equity shares At beginning of year (as restated) 2,495,019 2,013,373 2,404,394 6,912,786 Additions 15,000 -- 601,455 616,455 Fair value adjustments - P&L account -- 765,884 238,338 1,004,222 Revaluation adjustment - Available for (1,310,909) -- (425,557) (1,736,466) sale reserve Exchange rate adjustments -- -- 45,863 45,863 Diminution in value -- -- (46,041) (46,061) Disposals (16) (359,498) (746,829) (1,106,343) At end of year 1,199,094 2,419,759 2,071,623 5,690,456 Warrants and quoted investments with carried interest attached are revalued at fair value through the profit and loss account whereas unquoted and quoted investments without carried interest attached are revalued through the available for sale reserve. The historical cost value of the above quoted investments at the year end was £1,035,246 (2006: £1,374,684). The potential tax charge arising if the above quoted investments were sold at their market value is £290,214 (2006: £330,118). Profit on Disposal of Investments: Year ended Year ended 30 November 30 November 2007 2006 £ £ Gross profit on disposal of investments 1,355,493 1,443,487 Profit / (Loss) on disposal of current asset investments 5,038 (10,524) Carried Interest Bonus (see note 1) - (165,154) Net profit on disposal of investments 1,360,531 1,257,809 8. FINANCIAL INFORMATION The financial information in this press release, which has not been audited, does not constitute Statutory Accounts within the meaning of Section 240 of the Companies Act 1985. The Annual Report and Accounts for the year ended 30 November 2007 will be delivered to the Registrar of Companies following the Company's Annual General Meeting. Accounts for the year ended 30 November 2006 have been filed with the Registrar of Companies, and these accounts contain an unqualified audit report and did not contain any statements under Section 237(2) or (3) of the Companies Act 1985. This information is provided by RNS The company news service from the London Stock Exchange VRUUUR

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