TIDMBPM
RNS Number : 7636Z
B.P. Marsh & Partners PLC
05 September 2018
B.P. Marsh & Partners Plc
("B.P. Marsh", the "Company" or the "Group")
Trading Update
Trading Update
B.P. Marsh, the niche venture capital provider to early stage
financial services businesses, is pleased to provide the market
with an update on trading for the six months ended 31 July
2018.
Highlights
- Placing and Open Offer completed
- PSC Insurance Group Limited a new 19.6% investor
- GBP17m cash raised (before costs)
- New investment in ATC Insurance Solutions PTY Limited
- Strong opportunity pipeline
- GBP14.5m net cash available
In July 2018 the Group completed a successful Placing and Open
Offer, as a result of which a new investor, PSC Insurance Group
Limited ("PSC") (via its subsidiary PSC UK PTY Limited) became a
19.6% shareholder in the Company and delivered GBP17m in cash
(before expenses) to the Company.
The completion of this transaction represents the beginning of a
new phase of development for the Company, having passed the GBP100m
market capitalisation level for the first time and re-ordered the
shareholder base, with Brian Marsh's holding having reduced to 44%,
and with healthy cash reserves for developing the portfolio and for
new opportunities. The Group is encouraged to have a new
substantial shareholder that understands its business and with
which there are possibilities for future joint working.
The Company's investment portfolio is increasingly
geographically diverse with strong performers and the pipeline
continues to deliver sound investment opportunities. The management
team is committed to growing the Company's existing portfolio as
well as continuing to invest in early stage financial services
intermediary businesses with the aim of becoming the capital
provider of choice for the sector and delivering value to the
Company's shareholders.
New Investment
Investment in ATC Insurance Solutions PTY Limited ("ATC")
On 10 July 2018 the Group announced an investment into the
Australian based company ATC, taking a 20% equity stake for a total
cash consideration of AUD $5m (GBP2.8m).
ATC is a Managing General Agency which provides insurance
underwriting services to a wide array of clients across a number of
sectors, including Accident & Health, Construction &
Engineering, Plant & Equipment and Sports Liability.
Chief Executive Officer, Chris Anderson and Director, Shane
Sheppard established ATC as a Lloyd's Coverholder in 2009. ATC is
headquartered in Melbourne, with offices in Sydney and Brisbane,
employing more than 30 people.
For the year ended 30 June 2017, ATC reported Gross Written
Premium of AUD $47m. The budget for the year ending 30 June 2018
demonstrates substantial year on year growth for ATC, with expected
Gross Written Premium of circa AUD $60m.
Portfolio Developments
Specific developments within the portfolio during the period are
noted below:
CBC UK Limited ("CBC")
On 2 July 2018 CBC completed the 100% acquisition of PBS
Insurance Limited ("PBS"). PBS is a general insurance broker based
in Jersey. As part of the transaction, Si Aziz, the Managing
Director of PBS, subscribed for a shareholding in Paladin Holdings
Limited, CBC's parent company, in which B.P. Marsh holds a c. 45%
shareholding.
The transaction is an important development for CBC, being its
first acquisition since the investment by B.P. Marsh in February
2017 and expansion into a new territory with the resulting
opportunities this should bring.
CBC's audited accounts for the financial year ended 31 December
2017, the first year following the Management Buy-Out backed by the
Group, report revenue of GBP5.4m and profit before tax of GBP0.7m,
an increase in profit before tax over the previous year of
GBP0.7m.
CBC is actively seeking individuals or teams that would
complement the existing business, to further its growth
ambitions.
EC3 Brokers Limited ("EC3")
Since the Group's investment, in December 2017, EC3 has seen
continued profitability.
Management are reviewing a number of opportune personnel and
team hires and M&A activity in order to bring about substantial
growth.
LEBC Group Limited ("LEBC")
LEBC announced strong half-year results for the six-month period
to 31 March 2018, with revenue growth of 20.7% from GBP8.5m last
year to GBP10.2m. Trading profit grew by 95.3% from GBP1.2m to
GBP2.4m.
Demographic changes, with increasing numbers of people in
retirement, coupled with Pensions Freedom legislation have ensured
that LEBC has seen increased demand for its services, whilst the
firm has invested in technology and a new operating model to
increase the efficiency of its face-to-face advice.
LEBC has won several awards during the summer awards season,
with LEBC winning the Best Pension Adviser category of the
Corporate Adviser Awards on 3 July 2018, and LEBC's the Retirement
Adviser winning the Money Marketing Awards Best Retirement Adviser
in June 2018 and Best Use of Technology by a Corporate Adviser at
the Corporate Adviser Awards.
Nexus Underwriting Management Limited ("Nexus")
Nexus has undertaken a number of acquisitions in the Group's
financial year to 31 January 2018, including Vectura Underwriting,
Equinox Global, Zon Re Accident Reinsurance and Credit Risk
Solutions.
Since the Company's investment in 2014, Nexus has grown its
Gross Written Premium from GBP56m in 2014 to GBP175m in 2017. In
the same period, commission income has increased from GBP12.3m to
GBP23.5m in 2017 and EBITDA has increased from GBP2.6m to GBP10m in
2017.
In April 2018, Nexus was ranked at number 91 in the 19th annual
Sunday Times BDO Profit Track 100, a league table which ranks
Britain's 100 private companies with the fastest-growing profits
over their latest three years.
Walsingham Motor Insurance Limited ("Walsingham")
Walsingham, the London-based fleet MGA, continued its strong
growth, reporting a 20% increase in revenues from GBP2.2m to
GBP2.6m, and an increase in profit before tax from GBP0.1m to
GBP0.5m in the year to 30 September 2017.
Garry Watson, Walsingham's CEO, stated "The company continues to
make excellent progress as we build on relationships with brokers,
emphasising the benefits of using A rated paper."
Sterling Insurance (PTY) Ltd ("Sterling") & MB Prestige
Holdings (PTY) Ltd ("MB")
The Group's two investments in Sydney, Australia, Sterling and
MB, continue to perform in line or above the Group's expectations
at the current time.
Since the Group's investment in 2012, MB has continued to show
strong growth year on year with 2017 being MB's best year from a
performance standpoint to date.
Sterling, in which the Group has held an investment since 2013,
also reported a strong financial year to June 2018, exceeding its
EBITDA budget by c. 42%.
XPT Group LLC ("XPT")
Since the Group's investment in June 2017, XPT has made two
acquisitions: Western Security Surplus Insurance Brokers Inc, a
Texas-based wholesale broker and managing general agency, and W.E.
Love & Associates Inc, a North Carolina based managing general
agency.
XPT has been working towards bedding in these acquisitions and
has a strong pipeline of further opportunities it is assessing
currently.
Net Asset Value post-Placing and Open Offer
Following completion of the Placing and Open Offer on 9 July
2018, the Group notified the market on 23 July 2018 of its adjusted
NAV of 321p per share.
This is based on the previously announced NAV as at 31 January
2018, plus the net funds raised from the recently announced Placing
and Open Offer and the resultant enlarged Issued Share Capital. It
is to be noted that this Issued Share Capital figure excludes the
1,461,302 shares held under the Joint Share Ownership Plan
arrangements (announced on 13 June 2018) as these are currently
non-dilutive. It also excludes any investment portfolio movement
since 31 January 2018.
Share Buy-Backs
The Group reconfirmed its Share Buy-Back policy on 24 July 2018,
following the authority conferred by the Company's shareholders at
the annual general meeting held on 18 July 2018.
The Group's Share Buy-Back Committee meets periodically to
decide if Buy-Back transactions should be undertaken when the
discount to Net Asset Value of the Group's share price exceeds 20%.
The adjusted NAV of 321p, as above, will be used for this
calculation. The suitability of the 20% threshold is regularly
monitored by the Board.
The Group intends Buy-Backs to be used as a stabilising
mechanism and this has been particularly useful during periods of
market instability. During the period of six months to 31 July 2018
the Group undertook no Buy-Back transactions.
Dividend
The Board aims to find a balance between utilising cash to
invest in the existing portfolio and new opportunities, with
providing investors with a sustainable yield. It is the Board's
aspiration to continue to maintain a dividend of at least 4.76p per
share for the year ending 31 January 2019, subject to ongoing
review and approval by the Board and the Shareholders.
Director Appointments to the board of B.P. Marsh & Company
Limited
The Board is pleased to announce the appointment of three of its
current team to the board of its operating subsidiary B.P. Marsh
& Company Limited. Oliver Bogue, Investment Director, and
Abigail Barber, Investment Associate, of the Investment Department
and Francesca Lowley, Group Management Accountant, of the Finance
Department were appointed as Directors on 14 June 2018.
These appointments are in recognition of the increased
responsibilities and influence Oliver, Abigail and Francesca have
demonstrated to the Group. They have also each been appointed to
the Company's Investment Committee.
New Business Opportunities and Outlook
During the six-month period the Group has continued to see a
strong flow of new investment opportunities, both in the UK and
internationally, and discussions are ongoing on a number of
these.
The Managing General Agency sub-sector continues to produce a
strong pipeline of good potential opportunities, both in the UK and
internationally.
On the wealth management side, the Group continues to be
interested in businesses with ambitious and capable management
teams, whether IFAs, fund managers or other intermediaries.
The investment portfolio now has geographic representation in
the UK, Europe, U.S.A., Singapore, Australia, Canada and South
Africa, which the Group believes represents a solid international
framework and makes it well-positioned to take advantage of global
economic growth. The Group anticipates no adverse consequences to
its existing business from the withdrawal of the United Kingdom
from the European Union
Cash Balance
The net cash available for investment after provision for tax
and investment commitments currently stands at GBP14.5m.
Interim Results
The Group expects to report the results for the six months to 31
July 2018 on Tuesday 16 October 2018.
For further information:
B.P. Marsh & Partners Plc www.bpmarsh.co.uk
Brian Marsh OBE / Camilla Kenyon +44 (0)20 7233 3112
Nominated Adviser & Broker
Panmure Gordon (UK) Limited
Atholl Tweedie / Charles Leigh-Pemberton
/ Sandra Björck +44 (0)20 7886 2500
Notes to Editors:
About B.P. Marsh & Partners Plc
B.P. Marsh's current portfolio contains seventeen companies.
More detailed descriptions of the portfolio can be found at
www.bpmarsh.co.uk.
Since formation over 25 years ago, the Company has assembled a
management team with considerable experience both in the financial
services sector and in managing private equity investments. Many of
the directors have worked with each other in previous roles, and
all have worked with each other for at least five years.
Prior to Brian Marsh's involvement in the Company, he spent many
years in insurance broking and underwriting in Lloyd's as well as
the London and overseas market. He has over 30 years' experience in
building, buying and selling financial services businesses,
particularly in the insurance sector.
Alice Foulk joined B.P. Marsh in September 2011 having started
her career at a leading Life Assurance company. In 2014 she took
over as Executive Assistant to the Chairman, running the Chairman's
Office and established herself as a central part of the management
team.
In February 2015 she was appointed as a Director of B.P. Marsh
and a member of the Investment Committee. In January 2016 Alice was
appointed Managing Director of B.P. Marsh.
In her position as Managing Director, Alice is responsible for
the overall performance of the Company and monitoring the Company's
overall progress towards achieving the objectives and goals of the
Company, as set by the Board.
Dan Topping is the Chief Investment Officer of B.P. Marsh,
having been appointed as a Director in 2011. He joined the Company
in February 2007, following two years at an independent London
accountancy practice. Dan is the Senior Executive with overall
responsibility for the portfolio and investment strategy of B.P.
Marsh.
Dan graduated from the University of Durham in 2005 and is a
member of the Securities and Investment Institute and the Institute
of Chartered Secretaries and Administrators.
Dan is a standing member of the B.P. Marsh Investment and
Valuation Committees and currently serves as a Board Director
across the portfolio.
Camilla Kenyon (Millie) was appointed to the main Board in 2011,
following her appointment as Head of Investor Relations in 2009.
She has dual responsibilities within the Group, running both
Investor Relations and the New Business Department and is Chair of
the New Business Committee evaluating new investment
opportunities.
Millie is nominee director in one investee company and is a
member of the Investment Committee. She has over 20 years of
experience in the financial services industry, including numerous
Board appointments and is a Member of the Investor Relations
Society.
Jonathan Newman is a Chartered Management Accountant and is the
Group Director of Finance and has over 20 years' experience in the
financial services industry. Jon graduated from the University of
Sheffield with an honours degree in Business Studies and joined the
Group in November 1999, following two years at Euler Trade
Indemnity and two years at a Chartered Accountants. Jon is a Member
of the Chartered Global Management Accountants, the Chartered
Management Accountants and the Chartered Institute of Securities
and Investment.
Jon was appointed a Director of B.P. Marsh & Company Limited
in September 2001, and Group Finance Director in December 2003 and
was instrumental in the admission of the Group to AIM in February
2006. Jon is a member of the B.P. Marsh Investment and Valuation
Committees and currently serves as a Board Director for Walsingham
Motor Insurance Limited, and provides senior financial support and
advice to all companies within the Group's portfolio as well as
evaluating new investment opportunities.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
TSTLLFFRALISIIT
(END) Dow Jones Newswires
September 05, 2018 02:00 ET (06:00 GMT)
B.p. Marsh & Partners (LSE:BPM)
Historical Stock Chart
From Apr 2024 to May 2024
B.p. Marsh & Partners (LSE:BPM)
Historical Stock Chart
From May 2023 to May 2024