TIDMSAM
For immediate release: 0700hrs, Wednesday 8 December 2010
Syndicate Asset Management Plc
("Syndicate", the "Company" or the "Group")
Interim Results
Syndicate Asset Management Plc (AIM: SAM), the fund management group, today
announces its Interim Results for the six months ended 30 September 2010.
Financial highlights for period:
* Group revenues up 7.5% to GBP18.45 million when compared the same period last
year (6 months to 30 September 2009: GBP17.16 million);
* Wealth management subsidiary, Ashcourt Rowan, records a 28% increase in
revenues compared to same period last year;
* Wealth management subsidiary, Savoy, moves into profit achieving a
Reportable Segment Profit before Tax of GBP110,000 compared to a loss of GBP
342,000 for 6 months to 30 September 2009;
* Institutional fund management subsidiary, EPIC, sees revenues fall by GBP
460,000 over same period last year resulting in a Reportable Segment Loss
before Tax of GBP68,000 for the period;
* Group losses reduced by GBP400,000 for the period when compared to the same
period last year, reported loss for first half of year reduced to GBP33,000;
* Overall revenues and EBITDA achieved in the period in line with management
expectations.
Post Period Highlights:
* Funds under management or influence increased by approximately GBP1 billion
to GBP6.5 billion following the acquisition by Ashcourt Rowan of the IFA
business of the Co-operative Bank Independent Financial Advisers; and
* Mark Cheshire, CEO of Ashcourt Rowan, appointed to the Board as Group
Director of Sales and Business Development for the Group.
Peter Dew, Chairman of Syndicate Asset Management, commented:
"The Group has made significant strides towards returning all of its operations
to profitability. We are confident that the initiatives and organisational
streamlining now in train will allow the business to hit its year-end targets."
The Interim Results can additionally be downloaded from the Company's website
www.syndicateplc.com.
-Ends-
Further information:
Syndicate Asset Management plc
Jonathan Freeman (Group CEO) Tel: 020 7659 8060
Cenkos Securities plc
Stephen Keys/Julian Morse Tel: 020 7397 8900
GTH Communications
Toby Hall/Christian Pickel Tel: 020 3103 3903
Chairman's statement:
I am pleased to report to you the results of your Company for the six months
ended 30 September 2010.
I am delighted to say that we continue to make good progress in re-building the
Group's revenues. For the six months to 30 September 2010 Group revenues were
up 7.5% to GBP18.45 million when compared to the same period last year (6 months
to 30 September 2009: GBP17.16 million). We would normally expect our revenues to
be higher in the second half of our financial year and so the fact that we have
maintained revenues in the 6 months under review at the equivalent levels to
the second half of the last financial year, (six months to 31 March 2010: GBP
18.88 million), suggests that we are on track for a much improved full year. It
is also reassuring to note that the overall revenues achieved in the period
under review are in line with management's expectations.
Ashcourt Rowan, in particular, has enjoyed a very encouraging first half of our
financial year, with revenues of GBP12.38 million, up by approximately 28% on the
same period last year (6 months to 30 September 2009: GBP9.7 million). This
growth in revenue is, we believe, the direct result of the restructuring of the
Ashcourt and Rowan businesses, the repositioning of its product offering to the
mass affluent market, and increased marketing. We recognise that there is much
more work to do within Ashcourt Rowan with many opportunities to be addressed
and that this is effectively only the beginning of what can be achieved.
Since the period end we announced the acquisition by Ashcourt Rowan of the IFA
business of the Co-operative Bank Independent Financial Advisers Limited for an
initial consideration of GBP1 and fixed deferred consideration payments of GBP
250,000 on 1 October 2011 and GBP200,000 on 1 October 2012. This acquisition has
meant the transfer to us of approximately GBP1.0 billion of funds under
management or influence, the on-going commission revenues of the business, a
client base of approximately 55,000 customers and a network of IFA's and sales
managers to supplement our existing group of financial planners. This
acquisition is allowing Ashcourt Rowan to provide a significantly enhanced
national offering of financial planning advice and we expect that this will
have a positive impact on our revenues and profitability during the course of
2011. This post period end acquisition has also meant that the funds under
management in the Group were, as of 31 October 2010, approximately GBP6.5 billion
(30 September 2010: GBP5.5 billion and 30 March 2010: GBP5.8 billion).
Turning towards our High Net Worth wealth management business, Savoy, I am
pleased to report that it has made an unaudited Reportable Segment Profit
before Tax of GBP110,000, (6 months to 30 September 2009: loss of GBP342,000). This
profitability has been achieved despite a decline in revenues earned to GBP3.35
million for the period under review (6 months to 30 September 2009: GBP3.93
million). Savoy, whose business model is based around individual fund managers
managing portfolios for their own client-base, is now focused on ensuring that
existing fund managers increase the level of funds they individually manage as
well as attracting additional fund managers to the business in order that the
fixed cost base of the business is used more effectively. To support this, we
have been working on a range of projects to further improve the client
experience at Savoy with one key project being the development of a new Client
Relationship Management and investor portal platform which is due to go live in
the first quarter of 2011. This will, we expect, provide a huge benefit to
Savoy's existing client base and fund managers and will support Savoy's efforts
to attract new clients and fund managers. We look forward to gaining
confirmation that the strong progress made in returning the division to
profitability will be further reflected in improved revenue numbers for the
second half of the year.
As already reported in the first half of the year, the good progress made in
the wealth management divisions has been partially off-set by a decline in
revenues within our institutional business, EPIC, where revenues have fallen to
GBP1.67 million for the period under review (6 months to 30 September 2009: GBP2.1
million). This decline is due to the previously reported loss of funds under
management from EPIC's largest client not being replaced quickly enough by the
attraction of new mandates. This has resulted in EPIC having an unaudited
Reportable Segment Loss before Tax of GBP68,000, (6 months to 30 September 2009:
profit of GBP386,000). This loss of legacy clients also explains the reduction of
funds under management for EPIC to approximately GBP2.1 billion (30 September
2009: GBP2.6 billion) which has, in turn, caused the Group's funds under
management to fall to approximately GBP5.5 billion as at 30 September 2010 (31
March 2010: GBP5.8 billion). In addition to the on-going efforts to attract new
traditional mandates into EPIC which is bearing fruit, the management of EPIC
has also been working on the successful creation and launch of its first bond
fund which is open to both institutional and retail investors. The goal with
this was not to create just one fund but to put in place the necessary
structures to allow for the eventual launch of multiple funds. The first of
these funds, the EPIC International Bond Fund, was launched in July 2010. The
total funds received into the fund to date are approximately GBP17.0 million and
we expect that this total will grow significantly in the second half of this
financial year as the marketing efforts being undertaken begin to generate
investment. Once this first fund is established we intend to launch a variety
of other funds within the structures that we now have in place, with each new
fund addressing a particular segment of the fixed income universe. We expect
that these on-going efforts to attract new traditional mandates and the new
initiative to create a series of fixed income funds for retail and
institutional clients will return EPIC to revenue growth and profitability in
the near term.
That said, the low level of profitability within Savoy coupled to the loss
incurred by EPIC, has dampened the improved profitability within Ashcourt
Rowan. As a result, whilst losses for the first half of the year have been
reduced by GBP400,000, Syndicate has recorded a loss for the period of GBP33,000.
The Board is nevertheless confident that the initiatives already underway -
combined with the organisational adjustments outlined below - to increase
revenues will begin to be reflected within the Group results in the short term.
We commented in our annual report for the financial year ending 31 March 2010
that we had taken the strategic decision that the Guernsey based `Class B'
funds, which make up the majority of the Zenith Funds, are not core to our
business and that we were therefore working to sell this business to a third
party. We very much hope that we will be able to provide shareholders with a
further update on this process in the near future.
During the course of the period under review, and as previously announced, we
also welcomed to the Group Board as a Director, Neil Hale, who is the Group's
Chief Financial Officer. I am also pleased to be able to welcome to the Group
Board, as Group Director of Sales and Business Development, Mark Cheshire. Mark
is the CEO of Ashcourt Rowan and will continue with this role as well as taking
on responsibility for oversight of the revenues of the Group as a whole,
ensuring that they are growing. We have also asked Christopher Jeffreys, the
CEO of Savoy to also take on an oversight role for the asset managers within
the wealth management businesses of the Group, Ashcourt Rowan and Savoy, and
for Ravi Shankar, the CEO of EPIC, to also take on an oversight role for the
Group's various investment and research capabilities. We believe that these
organisational changes will allow the senior management of the Group to be more
co-ordinated across the Group and that this will encourage cross-company
fertilisation of ideas and business opportunities.
We likewise continue to work on the final parts of ensuring that Syndicate
provides a single platform of `central services' across the Group which is
expert, efficient and scalable. To this end we have now commenced the
implementation phase of the single Group operating platform which will
eventually be rolled out across all the divisions. The creation and
implementation of a single Group-wide operating platform is being taken with
great care. This planned project will be deliberately and incrementally
executed over the next 18 months ensuring that we do not put our businesses, or
their clients, at risk. Whilst this careful path causes some frustration to us
because it means that we have to rely on existing legacy systems for a longer
time than is at least theoretically necessary, we believe that the risks that
would be generated by a faster roll-out of the platform are not justifiable. In
addition to this on-going programme of works for the operating platform, I am
also pleased to be able to report that we have now made the strategic decision
to exit from our current three London properties and to move into a single
location on Gracechurch Street in the City of London. We intend to begin the
occupation of our new property in March 2011 and to have vacated all three of
our current London properties by the summer of 2011. In addition to the
financial savings that this move is expected to create for the Group, we are
also very excited by the many intangible benefits that will flow from
approximately one third of the Group's employees (approximately 120 people)
operating out of one location. Clearly these moves are still subject to a
variety of legal agreements being agreed and signed.
We stated in our annual report for the year to 31 March 2010 that the focus of
our attention has now turned towards building upon our existing strengths, in
order that our revenues and profits grow. I believe that these results show
that we are now beginning to provide consistently improving results which
reflect a part of the effort all of us within the Syndicate Group have
expended. We are well aware that there is a lot more to do and a lot more to
come. We will continue to emphasise cost reduction and revenue growth and very
much expect to be able to show success in this over the course of the next
months and years.
Once again there has been an enormous amount of personal commitment and effort
by many people across the Group. Some of this effort is beginning to be
reflected in our financial results and I congratulate those who have achieved
this. There is also, however, a significant amount of effort where the pay-back
in financial terms takes a longer period to reach maturity. I therefore take
this opportunity to thank all our staff, particularly those who are working on
longer term initiatives whose efforts are putting in place the infrastructure
and systems that will allow our business to continue materially growing and
prospering. Finally I would like to take this opportunity to thank our many and
varied clients for continuing to ask us to provide services to them.
Peter Dew
Chairman of the Board
7 December 2010
Consolidated income statement
Six months ended 30 September 2010
Six months Six months Year
ended ended ended
30 September 30 September 31 March
Note 2010 2009 2010
(unaudited) (unaudited) (audited)
GBP'000s GBP'000s GBP'000s
Revenue 18,451 17,164 35,684
Cost of sales (7,273) (6,460) (13,615)
Gross profit 11,178 10,704 22,069
Administrative expenses 5 (11,508) (10,766) (24,688)
Loss from operations (330) (62) (2,619)
Investment income 29 67 97
Other gains and losses 24 - -
Net finance costs (7) (436) 10
Loss before tax (284) (431) (2,512)
Taxation 6 251 (113) 408
Loss for the period attributable to (33) (544) (2,104)
the equity holders of the parent
Loss per share
Basic 7 (0.00)p (0.10)p (0.20)p
Diluted 7 (0.00)p (0.10)p (0.20)p
Consolidated statement of comprehensive income
Six months ended 30 September 2010
Six months Six months Year
ended ended ended
30 September 30 September 31 March
2010 2009 2010
(unaudited) (unaudited) (audited)
GBP'000s GBP'000s GBP'000s
Loss for the period (33) (544) (2,104)
Other comprehensive income: - (153) (153)
Unrealised currency (loss)/gain
recognised directly in equity
Total comprehensive income for the year (33) (697) (2,257)
Attributable to:
Equity holders of the Parent (33) (697) (2,257)
Total recognised income and expense for (33) (697) (2,257)
the period
Consolidated balance sheet
30 September 2010
30 September 30 September 31 March
Note 2010 2009 2010
(unaudited) (unaudited) (audited)
GBP'000s GBP'000s GBP'000s
Non-current assets
Goodwill 8 46,466 47,090 46,576
Other intangible assets 9 5,372 6,424 5,900
Property, plant and equipment 1,648 1,010 984
Available-for-sale investments 146 146 146
Total non-current assets 53,632 54,670 53,606
Current assets
Trade and other receivables 9,593 8,447 13,142
Cash and cash equivalents 8,962 6,480 7,531
Available-for-sale investments - 21 -
Total current assets 18,555 14,948 20,673
Total assets 72,187 69,618 74,279
Current liabilities
Trade and other payables (10,905) (7,506) (12,096)
Obligations under finance leases - (7) -
Loans and deferred consideration (62) (5,564) (917)
Short-term provisions 10 (116) (1,309) (125)
Total current liabilities (11,083) (14,386) (13,138)
Non-current liabilities
Loans and deferred consideration - (7,210) -
Deferred tax liabilities (1,144) (1,676) (1,395)
Obligations under finance leases - (5) -
Long-term provisions 10 (154) (1,131) (277)
Total non-current liabilities (1,298) (10,022) (1,672)
Total liabilities (12,381) (24,408) (14,810)
Net assets 59,806 45,210 59,469
Equity
Share capital 11 3,608 1,295 3,608
Share premium account 12 72,522 59,192 72,522
Equity reserve 1,305 759 935
Retained earnings (17,629) (16,036) (17,596)
Equity attributable to equity 59,806 45,210 59,469
holders of the parent
Consolidated statement of changes in equity
30 September 2010
Share Share Equity Retained Total
Capital Premium Reserve Earnings
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
At 31 March 2009 275 55,750 692 (15,339) 41,378
Total comprehensive income for
the period:
Loss for the period - - - (544) (544)
Other comprehensive income,
net of tax:
Unrealised currency loss - - - (153) (153)
Transactions with owners
recorded directly in equity:
Share-based payments - - 67 - 67
Issues of shares 1,020 4,085 - - 5,105
Costs of share issue - (643) - - (643)
At 30 September 2009 1,295 59,192 759 (16,036) 45,210
Total comprehensive income for
the period:
Loss for the period - - - (1,560) (1,560)
Transactions with owners
recorded directly in equity:
Share-based payments - - 476 - 476
Cancellation of share-based - - (300) - (300)
payments
Issues of shares 2,313 15,032 - - 17,345
Costs of share issue - (1,702) - - (1,702)
At 31 March 2010 3,608 72,522 935 (17,596) 59,469
Total comprehensive income for
the period:
Loss for the period - - - (33) (33)
Transactions with owners
recorded directly in equity:
Share-based payments - - 370 - 370
At 30 September 2010 3,608 72,522 1,305 (17,629) 59,806
Consolidated cash flow statement
Six months ended 30 September 2010
Six months Six months Year
ended ended ended
30 September 30 September 31 March
2010 2009 2010
Operating activities: (unaudited) (unaudited) (audited)
GBP'000s GBP'000s GBP'000s
Loss for the period (33) (544) (2,104)
Adjustments for:
Depreciation of property, plant and 271 226 455
equipment
Amortisation of intangibles 528 531 1,055
Share based payment expense 370 67 543
Impairment of available-for-sale - - 22
investments
Discount on repayment of loan notes - - (276)
Unrealised foreign exchange loss - (153) (153)
Investment income (29) (67) (97)
Finance costs 7 436 266
Corporation tax (credit)/expense (251) 113 (408)
Operating cash inflow/(outflow) before 863 609 (697)
movements in working capital
Decrease/(increase) in receivables 4,372 4,079 (614)
(Decrease)/increase in payables (2,017) (4,492) 777
Decrease in provisions (6) (14) (126)
Cash inflow/(outflow) from operations 3,212 182 (660)
Tax paid - (987) (1,100)
Interest received 29 67 95
Interest paid (7) (188) (318)
Cash inflow/(outflow) from operating 3,234 (926) (1,983)
activities
Investing activities
Acquisition of goodwill and intangible - - (58)
assets
Purchases of property, plant and (935) (157) (361)
equipment
Dividends received - 2 3
Net cash used in investing activities (935) (155) (416)
Financing activities
Proceeds of share issues - 5,105 22,450
Costs of share issue - (643) (2,345)
Repayments of obligations under finance - (2) (12)
leases
Repayments of loans and deferred (868) (4,000) (16,964)
consideration
Cancellation of share-based payments/ - - (300)
warrants
Net cash from financing activities (868) 460 2,829
Net decrease in cash and cash equivalents 1,431 (621) 430
Cash and cash equivalents at beginning of 7,531 7,101 7,101
period
Cash and cash equivalents at end of 8,962 6,480 7,531
period
Notes to the unaudited interim financial report
Six months ended 30 September 2010
1. Reporting entity
Syndicate Asset Management plc (the "Company") is a company domiciled in the
United Kingdom. The condensed consolidated interim financial statements of the
Company as at and for the six months ended 30 September 2010 comprise the
Company and its subsidiaries (together referred to as the "Group") and the
Group's interests in associates and jointly controlled entities. The
consolidated financial statements of the Group as at and for the year ended 31
March 2010 are available upon request from the Company's registered office at 7
Hanover Square, London W1S 1HQ or at www.syndicateplc.com.
2. Statement of compliance
These condensed consolidated interim financial statements have been prepared in
accordance with IAS 34 Interim Financial Reporting. They do not include all of
the information required for full annual financial statements, and should be
read in conjunction with the consolidated financial statements of the Group as
at and for the year ended 31 March 2010. These condensed consolidated interim
financial statements were approved by the Board of Directors on 7 December
2010.
3. Accounting policies
The accounting policies applied by the Group in these condensed consolidated
interim financial statements are the same as those applied by the Group in its
consolidated financial statements as at and for the year ended 31 March 2010,
except that with effect from 1 April 2010 the Group adopted the following new
standards and interpretations:
IFRS - 3 Business Combinations (2008) and IAS 27 - Consolidated and Separate
Financial Statements (2008) for business combinations occurring in the
financial year commencing 1 October 2009. All business combinations occurring
on or after 1 April 2010 are accounted for by applying the acquisition method.
The change in accounting policy was applied prospectively and had no material
impact on earnings per share.
4. Operating Segments
The Group has four reportable segments, as described below, which are the
Group's strategic business units. The strategic business units offer a
different mix of products and services, and are managed separately. For each of
the strategic business units, the Group's CEO reviews internal management
reports on at least a monthly basis. The following summary describes the
operations in each of the Group's reportable segments:
Ashcourt Rowan Group - Wealth management and financial planning
EPIC - Institutional investment management
Savoy - Wealth management
Syndicate C.I. (Zenith) - Retail fund management
Information regarding the results of each reportable segment is included below.
Performance is measured based on segment profit before tax, as included in the
internal management reports that are reviewed by the Group's CEO. Segment
profit is used to measure performance as management believes that such
information is the most relevant in evaluating the results of certain segments
relative to other entities that operate within these industries. Inter-segment
pricing is determined on an arm's length basis.
6 months to 30.09.2010 Ashcourt EPIC Savoy SAM C.I. Total
Rowan
6 months 6 months 6 months 6 months 6 months
ended ended ended ended ended
30.09.10 30.09.10 30.09.10 30.09.10 30.09.10
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
External revenues 12,347 1,666 3,346 1,092 18,451
Inter-segment revenues 34 47 - - 81
Total revenue 12,381 1,713 3,346 1,092 18,532
External cost of sales (4,819) (627) (1,194) (633) (7,273)
Inter-segment cost of - - - (81) (81)
sales
Total cost of sales (4,819) (627) (1,194) (714) (7,354)
Gross Profit 7,562 1,086 2,152 378 11,178
Administrative expenses (5,697) (1,000) (1,672) (486) (8,855)
Depreciation and (617) (2) (47) - (666)
amortisation
Total administrative (6,314) (1,002) (1,719) (486) (9,521)
expenses
Operating profit 1,248 84 433 (108) 1,657
Finance income 28 1 - - 29
Finance expense (7) - - - (7)
Group management charges (816) (153) (323) (90) (1,382)
Reportable segment profit 453 (68) 110 (198) 297
before tax
Segment assets 34,465 4,879 4,733 5,515 49,592
Segment liabilities (24,035) (603) (1,541) (4,473) (30,652)
6 months to 30.09.2009 Ashcourt EPIC Savoy SAM C.I. Total
Rowan
6 months 6 months 6 months 6 months 6 months
ended ended ended ended ended
30.09.09 30.09.09 30.09.09 30.09.09 30.09.09
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
External revenues 9,647 2,113 3,928 1,476 17,164
Inter-segment revenues 36 60 - - 96
Total revenue 9,683 2,173 3,928 1,476 17,260
External cost of sales (3,561) (887) (1,447) (565) (6,460)
Inter-segment cost of - - - (96) (96)
sales
Total cost of sales (3,561) (887) (1,447) (661) (6,556)
Gross Profit 6,122 1,286 2,481 815 10,704
Administrative expenses (4,881) (733) (2,531) (851) (8,996)
Depreciation and (390) (79) (79) (155) (703)
amortisation
Total administrative (5,271) (812) (2,610) (1,006) (9,699)
expenses
Operating profit 851 474 (129) (191) 1,005
Finance income 55 2 4 3 64
Finance expense (120) - - (20) (140)
Group management charges (467) (90) (217) (72) (846)
Reportable segment profit 319 386 (342) (280) 83
before tax
Segment assets 34,789 5,700 4,800 3,852 49,141
Segment liabilities (24,195) (1,087) (1,458) (2,346) (29,086)
Reconciliations of reportable segment revenues, profit or loss
6 months 6 months
ended ended
30 September 30 September
2010 2009
GBP000's GBP000's
Revenues
Total revenue for reportable segments 18,532 17,260
Less intra-segment revenue (81) (96)
Consolidated revenue 18,451 17,164
6 months 6 months
ended ended
30 September 30 September
2010 2009
GBP000's GBP000's
Total administrative expenses
Total administrative expenses for (9,521) (9,699)
reportable segments
Less unallocated items (1,987) (1,067)
Consolidated total administrative (11,508) (10,766)
expenses
6 months 6 months
ended ended
30 September 30 September
2010 2009
GBP000's GBP000's
Profit or loss before tax
Total profit before tax for 297 83
reportable segments
Unallocated amounts:
Management fees paid to parent 1,382 847
Head office costs and costs of parent (1,855) (1,014)
Depreciation and amortisation (133) (54)
Other gains and losses 25 -
Investment income - 3
Finance costs - (296)
Consolidated loss before tax (284) (431)
Reportable Unallocated Consolidated
segment amounts totals
total
GBP000's GBP000's GBP000's
Other material items 2010
Finance income 29 - 29
Finance expense (7) - (7)
Amortisation and depreciation (666) (133) (799)
Reportable Unallocated Consolidated
segment amounts totals
total
GBP000's GBP000's GBP000's
Other material items 2009
Finance income 64 6 70
Finance expense (140) (296) (436)
Amortisation and depreciation (703) (54) (757)
5. Administrative expenses
Administrative expenses include depreciation of GBP271,000 (six months ended 30
September 2009: GBP226,000 and year ended 31 March 2010: GBP455,000) and
amortisation of non-goodwill intangible assets of GBP528,000 (six months ended 30
September 2009: GBP531,000 and year ended 31 March 2010: GBP1,055,000).
6. Taxation
Six months Six months Year ended
ended ended
30 September 30 September 31 March
2010 2009 2010
(unaudited) (unaudited) (audited)
GBP'000s GBP'000s GBP'000s
Current tax:
UK corporation tax - (241) -
Overprovision in prior periods - (39) (39)
Deferred tax:
Current year 251 167 447
251 (113) 408
Corporation tax for the interim period is charged at 28% (year ended 31 March
2010: 28%), representing the best estimate of the weighted average annual
corporation tax rate expected for the full financial year.
7. Earnings per share
The calculation of the basic and diluted earnings per share is based on the
following data:
Six months Six months Year
ended ended ended
30 September 30 September 31 March
Earnings 2010 2009 2010
(unaudited) (unaudited) (audited)
GBP'000s GBP'000s GBP'000s
Earnings for the purposes of basic (33) (544) (2,104)
earnings per share being net profit
attributable to equity holders of the
parent
Six months Six months Year
ended ended ended
30 September 30 September 31 March
2010 2009 2010
Number Number Number
Number of shares
Weighted average number of ordinary 1,804,015,296 522,113,438 1,049,591,627
shares for the purposes of basic
earnings per share
Effect of dilutive potential ordinary
shares:
Warrants - - -
Options - - -
Weighted average number of ordinary 1,804,015,296 522,113,438 1,049,591,627
shares for the purposes of diluted
earnings per share
The denominator for the purposes of calculating basic earnings per share has
been adjusted to reflect the share issues which took place during the period.
During the period the potential ordinary shares under the options would have
the effect of reducing the loss per share and therefore are anti-dilutive.
8. Goodwill
GBP'000s
Cost
As at 31 March 2009 (audited) 48,090
Adjustment to the fair value of consideration payable:
EPIC (1,000)
As at 30 September 2009 (unaudited) 47,090
Adjustment to the fair value of consideration payable:
EPIC (573)
Additional amounts paid on restructuring of deferred consideration 59
As at 31 March 2010 (audited) 46,576
Adjustment to the fair value of consideration payable:
Burfield (24)
Pagan Osborne (86)
As at 30 September 2010 (unaudited) 46,466
9. Other intangible assets
Acquired Acquired Acquired
client OEIC and Investment
relationships unit trust trust
management management
contracts contracts Total
GBP'000s GBP'000s GBP'000s GBP'000s
Cost
At 31 March 2009 (audited) 6,419 3,251 442 10,112
Acquired on acquisition of - - - -
businesses
At 30 September 2009 6,419 3,251 442 10,112
(unaudited)
Acquired on acquisition of - - - -
businesses
At 30 September 2010 6,419 3,251 442 10,112
(unaudited)
Acquired on acquisition of - - - -
businesses
At 30 September 2010 6,419 3,251 442 10,112
(unaudited)
Amortisation
At 31 March 2009 (audited) 1,713 1,258 186 3,157
Charge for the period 324 163 44 531
30 September 2009 (unaudited) 2,037 1,421 230 3,688
Charge for the period 317 162 45 524
At 31 March 2010 (audited) 2,354 1,583 275 4,212
Charge for the period 321 163 44 528
At 30 September 2010 2,675 1,746 319 4,740
(unaudited)
Carrying amount
At 30 September 2010 3,744 1,505 123 5,372
(unaudited)
At 31 March 2010 (audited) 4,065 1,668 167 5,900
At 30 September 2009 4,382 1,830 212 6,424
(unaudited)
At 31 March 2009 (audited) 4,706 1,993 256 6,955
10. Provisions
Surplus Contingent Total
leasehold deferred GBP'000s
property consideration
costs
GBP'000s GBP'000s
At 31 March 2009 (audited) 308 3,526 3,834
Reduction in provision (14) (1,380) (1,394)
At 30 September 2009 (unaudited) 294 2,146 2,440
Change in provision (110) (1,928) (2,038)
At 31 March 2010 (audited) 184 218 402
Reduction in provision (6) (126) (132)
At 30 September 2010 (unaudited) 178 92 270
30 September 30 September 31 March
2010 2009 2010
(unaudited) (unaudited) (audited)
GBP'000s GBP'000s GBP'000s
Included in current liabilities 116 1,309 125
Included in non current 154 1,131 277
liabilities
270 2,440 402
The provision in respect of surplus leasehold assets reflects management's best
estimate of the liability arising from onerous lease obligations in respect of
leasehold property interests acquired on the acquisition of subsidiaries in the
periods ended 31 March 2006 and 2007.
The provision in respect of contingent deferred consideration relates to
consideration on acquisitions that will fall due only if future conditions are
met. These conditions include future levels of profitability, turnover or
values of funds under management as follows:
a) On 29 February 2008 Investment Management Holdings Limited acquired 100% of
the issued share capital of Burfield and Partners Asset Management Limited.
Consideration included minimum deferred consideration of GBP100,000 to a maximum
of GBP275,000 based on 71% of revenue arising post acquisition. The deferred
consideration is payable over the period from the date of acquisition to 31
March 2011. The provision included at 30 September 2010 is GBP92,000.
11. Share Capital
30 September 30 September 31 March
2010 2009 2010
(unaudited) (unaudited) (audited)
GBP'000s GBP'000s GBP'000s
Authorised:
2,500,000,000 ordinary shares of GBP 5,000 3,000 5,000
0.002 each
Issued and fully paid:
1,804,015,296 ordinary shares of GBP 3,608 1,295 3,608
0.002 each
No new ordinary shares in the Company were issued during the period.
The Company has one class of ordinary shares which carries no right to fixed
income.
Share capital
GBP'000s
At 31 March 2009 (audited) 275
Issue of equity shares 1,020
At 30 September 2009 (unaudited) 1,295
Issue of equity shares 2,313
At 31 March 2010 (audited) and at 30 3,608
September 2010 (unaudited)
12. Share Premium
Share
premium GBP
'000s
At 31 March 2009 (audited) 55,750
Issue of equity shares 4,085
Cost of share issues (643)
At 30 September 2009 (unaudited) 59,192
Issue of equity shares 15,032
Cost of share issues (1,702)
At 31 March 2010 (audited) 72,522
Issue of equity shares -
Cost of share issues -
At 30 September 2010 (unaudited) 72,522
13. Post balance sheet events
On 1 October 2010 the Company acquired the business of Co-Op Independent
Financial Advisers for an initial consideration of GBP1 plus a share of the
revenue of the business of GBP250,000 payable in October 2011 and GBP200,000
payable in October 2012.
END
Syndicate Asset Management (LSE:SAM)
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