Preliminary Results
04 Mai 2006 - 2:59PM
UK Regulatory
RNS Number:4497C
Conister Trust PLC
04 May 2006
Conister Trust PLC Year-end results
Preliminary results announcement for y/e 31/12/05
Chairman's Statement
The profit on ordinary activities before tax for the year was #124,000 (2004:
#760,000). Following an interim dividend of 0.3p per share (2004:0.3p) the board
has resolved that no final dividend should be declared (2004:0.75p per share).
Throughout the period the group faced strong competition, with both volumes and
margins under pressure. Despite opening a new office in February 2005 for
lending to military personnel, the overall interest receivable grew only 4.1% to
#7.5 million (2004:#7.2 million). After deducting interest payable and
commissions, the net operating income grew 5% to #4.2 million (2004:#4.0
million).
We continued to monitor costs closely, including a freeze on staff pay in April
2005. However, expenses have grown ahead of revenues. This is largely explained
by the costs of the new office in Peterborough; closing the office in
Huddersfield; additional resources to grow the UK HP book; and further
investment in upgrading the IT system. At the time of writing we are reviewing
our position with the supplier of the new IT software.
After deducting provisions for bad and doubtful debts, which we continue to make
on a prudent basis, tax and the payment of an interim dividend of 0.3p per
share, the retained earnings for the year were #23,000 (2004:#414,000).
Business Units
During 2005, HP advances fell by 16% and there was a 23% reduction in the number
of agreements entered into. This was mainly in the core Manx lending book, where
margins were also under pressure.
Volumes from UK brokers remained static and lending margins were further eroded.
Our in-house UK broker, Conister Finance and Leasing Limited, delivered lower
volumes and margins.
The new office in Peterborough performed well against its budget and this has
continued since the year-end. As this is unsecured lending, we will not take an
aggressive stance in this market.
We significantly reined back lending for litigation funding, consequent upon the
withdrawal of a number of companies from the after-the-event insurance market.
Litigation funding continues to be our highest margin business, but the amount
set aside for provisioning has grown as repayments are taking longer than
anticipated. However, we are confident that we are taking appropriate action
and, if successful, we will be able to write back some of this in future
periods.
At the end of 2005, we announced the launch of a new revenue stream from the
provision of premium finance on insurance policies. An agreement was reached
with Group Direct Limited, which is anticipated to deliver lending of at least
#5 million annually over 4 years.
Directorate
I have noted previously our need to move into new markets. As can be seen in the
performance for 2005, our traditional markets, primarily HP and motor finance,
are mature and competitive and offer limited opportunity for sustained
profitable growth. The board has now identified new strategic opportunities.
This led to the creation of a new role of Chief Executive Officer and, after a
thorough search, I was delighted to announce the appointment by the board of Mr
Jerry Linehan as CEO. He has now completed a strategic review of the group and
identified a number of significant opportunities, which are being progressed
rapidly.
During the year, Mr John Webster, who was appointed a non executive director in
2004, left the board to pursue his growing personal business interests and, more
recently, Mr Gareth Jones, Executive Director, who was appointed in 2003, left
the board to return to the UK. I thank them for their services to the company
and wish them well in their future endeavours.
Outlook
Since the end of the financial period, trading conditions have remained
competitive. However, the board is actively pursuing new significant strategic
opportunities and details will be announced in the very near future.
The board is confident in the future potential of the bank for customers, staff
and shareholders and, in what has been a challenging year, I wholeheartedly
thank all our staff for their hard work and dedication.
Consolidated Profit & Loss Account
for the year ended 31 December 2005
2005 2004
Restated
#000 #000
Interest receivable and similar income 7,461 7,162
Interest payable (2,492) (2,308)
--------- ----------
Net interest income (gross income) 4,969 4,854
Commissions (848) (915)
Other operating income 56 64
--------- ----------
Net operating income 4,177 4,003
Operating expenses (3,180) (2,708)
Bad and doubtful debts - specific (586) (200)
- general (287) (335)
--------- ----------
Profit on ordinary activities before taxation 124 760
--------- ----------
Taxation (16) (49)
--------- ----------
Profit on ordinary activities after taxation 108 711
Dividends (85) (297)
--------- ----------
Retained profit for the year 23 414
========= ==========
Basic earnings per share 0.38p 2.53p
========= ==========
Fully diluted earnings per share 0.38p 2.53p
========= ==========
Consolidated Statement of Total Recognised Gains and Losses
for the year ended 31 December 2005
2005 2004
Restated
#000 #000
Profit for the financial year 108 711
Loss on pension scheme (33) (31)
Current tax associated with loss on pension scheme 3 1
Deferred tax associated with loss on pension scheme - 2
--------- ----------
Total recognised gains and losses relating to the year 78 683
Prior period adjustment (482)
---------
Total gains and losses recognised since last annual (404)
report =========
The adoption of Financial Reporting Standard 17 "Retirement
Benefits" (FRS 17") has required a change to the accounting treatment of
pensions and the prior year Balance Sheet and results have been restated as
shown above.
Balance Sheets
as at 31 December 2005
Group Company
2005 2004 2005 2004
Restated Restated
#000 #000 #000 #000
Assets
Cash at bank 6,827 5,087 6,811 4,972
Customers accounts receivable 55,739 57,395 54,471 54,702
Tangible fixed assets 866 1,070 807 890
Investment in subsidiary - - 10 10
undertakings
Other debtors and prepayments 169 123 416 2,171
--------- --------- --------- ----------
Total assets 63,601 63,675 62,515 62,745
========= ========= ========= ==========
Liabilities
Deposit accounts 52,884 52,701 52,884 52,701
Creditors and accrued charges 554 664 499 563
Proposed dividends - 212 - 212
Provision for liabilities and - 5 - -
charges --------- --------- --------- ----------
53,438 53,582 53,383 53,476
Capital resources
--------- --------- --------- ----------
Called up share capital 7,111 7,056 7,111 7,056
Share premium account 769 749 769 749
Profit and loss account 1,799 1,806 768 982
--------- --------- --------- ----------
Equity shareholders' funds 9,679 9,611 8,648 8,787
--------- --------- --------- ----------
Total liabilities and equity
shareholders' 63,117 63,193 62,031 62,263
funds excluding pension liability
Pension liability 484 482 484 482
--------- --------- --------- ----------
Total liabilities and equity
shareholders' 63,601 63,675 62,515 62,745
funds including pension liability ========= ========= ========= ==========
Consolidated Cash Flow Statement
for the year ended 31 December 2005
Reconciliation of profit before taxation 2005 2004
to net operating cash flow Restated
#000 #000
Profit before taxation 124 760
Profit on sale of fixed assets (60) (1)
Provision on fixed assets 120 -
Depreciation charge 103 103
Pension scheme (31) (10)
Increase in trade debtors (32) (53)
(Decrease)/Increase in trade creditors (206) 110
--------- ----------
Net cash inflow from trading activities 18 909
Decrease/(Increase) in customers accounts receivable 1,656 (6,323)
Increase in deposit accounts 183 4,828
--------- ----------
Net cash inflow/(outflow) from operating activities 1,857 (586)
========= ==========
Cash flow statement 2005 2004
#000 #000
Net cash inflow/(outflow) from operating activities 1,857 (586)
Taxation (49) (37)
Capital expenditure
Purchase of tangible fixed assets (109) (240)
Sale of tangible fixed assets 150 42
--------- ----------
1,849 (821)
Equity dividends paid (222) (207)
--------- ----------
Increase /(Decrease) in cash 1,627 (1,028)
========= ==========
Preparation of the results
The financial information set out in this statement is extracted from the
statutory financial statements which have not yet been audited but are not
expected to differ materially from the information given in this statement.
Final dividend
An interim dividend of 0.3p per share has been paid. The directors do not
propose to pay a final dividend.
Report and Accounts
A copy of these results contained in the annual report and accounts for the year
ended 2005 will be posted to shareholders by 22 May, 2006 and will be available
from that date from the Company's Registered Office, Conister House, 16-18 Finch
Road, Douglas, Isle of Man, IM1 2PT and will be posted on the Company's web site
www.conistertrust.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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