TIDMTAVI
RNS Number : 6709E
Tavistock Investments PLC
10 November 2020
Tavistock Investments Plc
("Tavistock" or the "Company")
Interim Accounts
10 November 2020
Tavistock Investments Plc (AIM:TAVI) announces its unaudited
interim results for the six months ended 30 September 2020.
Financial highlights
-- 25% increase in the level of adjusted EBITDA compared to the same period last year
-- Higher operating profit from lower gross revenues with
adjusted EBITDA of GBP1.3 million on gross revenues of GBP13.4
million
Operational highlights
-- The leadership team is well advanced with a comprehensive
Group-wide reorganisation expected to deliver more than GBP750,000
of annual cost savings
-- Investments
- Tavistock Wealth increased contribution to the Group's
adjusted EBITDA by 32% to GBP2.0 million
- Level of FUM (funds under management) remained steady at GBP1.1 billion
-- Protected products
- The Company's newest fund, the ACUMEN ESG Protection
Portfolio, has performed particularly well to date, with its NAV
(net asset value) dropping by just 1% between inception in December
2019 and the end of October 2020, compared to the FTSE 100 falling
by almost 17% over the same period
- The fund won the Innovation Award at the 2020 Moneyfacts
Investment Life & Pension Awards, beating competition from
other much larger nominees
-- Advisory
- Increased contribution to the Group's adjusted EBITDA by 344%
to GBP964,000, predominantly resulting from the eradication of
losses previously experienced by two entities.
Brian Raven, Chief Executive of Tavistock Investments, said: "In
a year of unprecedented pressure on our business, I am delighted by
our Group's performance and by how well our management team has
adapted. We have undertaken a comprehensive cost saving exercise
and are accelerating plans to significantly scale up our business.
I am confident that these initiatives will enable us to deliver
greater value to our shareholders and look forward to managing a
growing dividend for their benefit."
Post-period update
-- The Company is about to launch a new low-cost platform
service, the Tavistock Platform, for use by the clients of the
Group's advisers. The Group will then be delivering all aspects of
the financial services value chain to retail clients - financial
advice, investment management and the platform service that
provides for the administration and custodianship of clients'
assets.
-- It is currently difficult to assess precisely how the Group
will perform in the second half of its financial year, given the
variable possibilities with regard to the Brexit outcome, the
Government's public health policy and the impact on markets of the
US Presidential election result. However, the Directors are
confident that the initiatives underway will enable the Company to
continue to increase operating profit and recommence the payment of
a dividend.
Ends
Enquiries
Tavistock Investments Plc Tel: 01753 867000
Oliver Cooke
Brian Raven
Allenby Capital Limited Tel: 020 3328 5656
Nick Naylor, Nick Athanas,
Liz Kirchner
Corporate Finance
Tony Quirke
Sales
Vested Tel: 07540 496 159
Sophie Paterson
TAVISTOCK INVESTMENTS PLC
CHAIRMAN'S STATEMENT
FOR THE SIX MONTHSED 30 SEPTEMBER 2020
I am pleased to report that the business has performed
particularly well in the face of the pandemic, the related
Government imposed restrictions, and their impact on both customer
confidence and the market value of investment assets. The Directors
are now turning their focus to the development of a substantially
larger business.
The Government's imposition of a national lock-down took the
population by surprise. However, the leadership team reacted
swiftly and successfully transitioned the business to home-working
and the use of new technology. They also moved quickly to reduce
the Group's operating costs in response to what was then seen as an
unquantifiable threat to the business.
As a consequence of these decisive actions, the Company has been
able to report an increase of 25% in the level of adjusted EBITDA
(earnings before interest tax depreciation and amortisation)
compared to the same period last year and is well positioned to
deal with the second lock-down.
The leadership team has also undertaken a detailed review of
business operations and is well advanced with a comprehensive
Group-wide reorganisation exercise. Upon completion, this is
expected to deliver over GBP750,000 of annual cost savings.
The reorganisation includes a reduction in the number of offices
being occupied by the Group, from eleven to six, the loss of some
senior as well as junior staff, and the withdrawal from less
productive areas of business activity. One such activity was the
Group's association with the Law Society which both parties agreed
to terminate amicably, once it became apparent that the
relationship was unlikely to deliver an appropriate level of return
to Tavistock.
The Government's response to the emergence of a second wave of
the pandemic, the imminence of the UK's departure from the European
Union and the consequences of the US Presidential election result
are all factors that make it difficult to assess the Company's
likely performance in the second half of the financial year.
However, the leadership team is confident that the business will
continue to perform well over the medium and long term. In addition
to focusing on the optimisation of the Group's facilities, the
containment of costs and the improvement of operational efficiency,
they are progressing with plans to deliver greater value to
shareholders.
Investment Management
During the period, Tavistock Wealth increased its contribution
to the Group's adjusted EBITDA by 32% from GBP1.5 million in the
six months to 30 September 2019, to GBP2.0 million.
The level of FUM (funds under management) remained steady at
GBP1.1 billion (30 September 2019 GBP1.1 billion) despite the
recent blows to customer confidence and the sudden and sustained
falls in the market value of investment assets.
The Company's newest fund, the ACUMEN ESG Protection Portfolio,
has performed particularly well to date and won the Innovation
Award at the 2020 Moneyfacts Investment Life & Pension Awards,
beating off competition from other much larger nominees including
7IM, Standard Life, Brooks McDonald, Investec and Legal &
General.
The fund's NAV (net asset value) dropped by just 1% between
inception in December 2019 and the end of October 2020. By
comparison, the FTSE 100 fell by almost 17% over the same
period.
Advisory
During the period, the Advisory business increased its
contribution to the Group's adjusted EBITDA by an impressive 344%,
from GBP217,000 to GBP964,000. This predominantly resulted from the
eradication of the losses previously experienced by two
entities.
New business levels are heavily influenced by advisers' ability
to meet with clients and recurring revenue levels are linked to the
underlying value of the clients' investment assets. Both have been
adversely impacted in the short-term by recent events. During the
six months to 30 September 2020, the overall level of Advisory
gross revenue fell by 8% in comparison with last year, from GBP11.6
million to GBP10.7 million.
Financial Performance
During the period, the Directors delivered higher operating
profit from lower gross revenues, enabling the Group to report
adjusted EBITDA of GBP1.3 million on gross revenues of GBP13.4
million (comparative period, EBITDA of GBP1.0 million on gross
revenues of GBP14.3 million).
At the end of the period the Group had available cash resources
of GBP4.0 million (31 March 2020 GBP2.4 million).
Cash resources were boosted by the draw-down of a CBILS loan
facility and by GBP785,000 of cash generated from operations
(comparative period GBP1.0 million). During the period the Group
spent some GBP101,000 on the purchase of fixed assets, much of
which was to facilitate the move to home-working, GBP687,000 on
payments toward the purchase of client books and GBP257,000 on key
initiatives. Debt and finance obligations were also reduced by
GBP392,000.
At 30 September 2020, the Group had net assets of some GBP15.0
million (31 March 2020 GBP15.4 million) with the reduction from 30
September 2019 resulting from the GBP5.0 million provision against
the carrying value of acquired intangible assets that was made in
the Group's audited accounts for the financial year ended 31 March
2020. However, as a consequence of having made this provision, the
amortisation charge in the period under review was some GBP390,000
lower than in the equivalent period last year.
During the period, the Group established a reorganisation
reserve of GBP1.2 million to meet the one-off costs of the exercise
referred to above. Given the GBP750,000 of anticipated annual
savings, full payback will be achieved in less than two years.
The Group's results for the period can be summarised as
follows:
6 Months ended 6 Months ended Movement
30 Sept '20 30 Sept '19
GBP'000s GBP'000s
Gross Revenues 13,380 14,311 7% decrease
--------------- --------------- --------------
Reported adjusted EBITDA 1,260 1,006 25% increase
--------------- --------------- --------------
Depreciation &
Amortisation (326) (755) 57% decrease
--------------- --------------- --------------
Share based payments (13) (131) 90% decrease
--------------- --------------- --------------
Profit from operations
before reorganisation
reserve, investment write
off and minority interest 921 120 668% increase
--------------- --------------- --------------
Reorganisation provision (1,200) - -
--------------- --------------- --------------
Investment write off - (133)* -
--------------- --------------- --------------
Minority interest (22) - -
--------------- --------------- --------------
Reported Loss from operations (301) (13) -
--------------- --------------- --------------
Loss per share 0.07p 0.01p -
--------------- --------------- --------------
*Write-off of investment in strategic relationship with
Lighthouse Group Plc.
Future Prospects
The Directors plan to deliver greater value to shareholders
through the resumption of dividend payments this year and other
developments that they expect will lead to increases in the
Company's share price.
Distributable reserves are a prerequisite for the payment of
dividends, and these have now been created through the successful
completion of a Court sanctioned process. The Directors look
forward both to the resumption of dividend payments and to the
management of a growing dividend stream for the benefit of
shareholders.
The Group is about to launch a new low-cost platform service,
the Tavistock Platform, for use by the clients of the Group's
advisers. The Group will then be delivering all aspects of the
financial services value chain to retail clients - financial
advice, investment management and the platform service that
provides for the administration and custodianship of clients'
assets.
At that point, the Company will have established a solid,
commercially successful base upon which to develop a much more
substantial business.
The Directors consider that the Company is chronically
undervalued with a market capitalisation of some GBP10.0 million
and have confirmed this view in discussions with independent
experts. At its current microcap scale, the Company's share price
is susceptible to volatile movements based upon extremely low
trading volumes and values. For example, in the month of October
2020 there were just 55 trades, for a total of 868,000 shares at an
aggregate value of less than GBP14,000. This represents less than
0.15% of the Company's issued share capital. Yet this very low
level of activity resulted in a 30% adverse movement in the share
price.
The Directors believe that such disproportionate volatility can
only be eliminated effectively through the development of a much
larger, dividend paying business with a higher proportion of the
Company's shares in public hands. This would be best achieved by
combining continued organic growth with an accelerated,
acquisition-led growth strategy. The Directors are actively focused
on how best to achieve such a strategy in a manner that delivers
value to shareholders before rewarding the leadership team. I look
forward to updating you in due course.
It is currently difficult to assess precisely how the Group will
perform in the second half of the financial year, given the
variable possibilities with regard to the Brexit outcome, the
Government's public health policy and the impact on markets of the
US Presidential election result. However, the Directors are
confident that the initiatives highlighted in this report will
enable the Company to continue to increase operating profit and
recommence the payment of a dividend.
I look forward to updating you on progress.
Oliver Cooke
Chairman
10(th) November 2020
TAVISTOCK INVESTMENTS PLC
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
FOR THE SIX MONTHSED 30 SEPTEMBER 2020
Unaudited Unaudited
6 months ended 6 months ended
30 September 30 September
2020 2019
Note GBP'000 GBP'000
Revenue 2 13,380 14,311
Cost of sales (7,660) (8,500)
------------ ------------
Gross profit 5,720 5,811
Administrative expenses (6,021) (5,824)
-------------- --------------
Loss from operations (301) (13)
Memorandum:
Adjusted EBITDA 1,260 1,006
Depreciation & amortisation (326) (888)
Restructuring provision (1,200) -
Share Based Payment (13) (131)
Minority interest (22) -
-------------- --------------
Loss from operations (301) (13)
Finance costs (115) (119)
------------ ------------
Loss before taxation and attributable
to equity holders of the parent (416) (132)
Taxation - 54
------------ ------------
Loss after taxation and attributable
to equity holders of the parent and
total comprehensive income for the
period (416) (78)
====== ======
Loss per share
Basic 3 (0.07)p (0.01)p
====== ======
TAVISTOCK INVESTMENTS PLC
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
AS AT 30 SEPTEMBER 2020
Unaudited Audited
30 September 2020 31 March 2020
GBP'000 GBP'000 GBP'000 GBP'000
ASSETS
Non-current assets
Tangible fixed assets 774 915
Intangible assets 4 17,576 16,907
----------------- -----------------
Total non-current assets 18,350 17,822
Current assets
Trade and other receivables 6,025 4,998
Cash and cash equivalents 3,974 2,416
----------------- -----------------
Total current assets 9,999 7,414
----------------- -----------------
Total assets 28,349 25,236
LIABILITIES
Current liabilities (5,659) (4,994)
Non-current liabilities
Loan & Lease liability (3,620) (1,396)
Payments due regarding purchase
of client lists (927) (1,234)
Provisions (3,062) (2,115)
Deferred taxation (93) (93)
------------------ ------------------
Total liabilities (13,361) (9,832)
------------------ ------------------
Total net assets 14,988 15,404
========= =========
Capital and reserves
attributable
to owners
of the parent
Share capital 5 13,426 13,426
Share premium 6,001 6,001
Retained earnings (4,439) (4,023)
------------------ ------------------
Total equity 14,988 15,404
========= =========
TAVISTOCK INVESTMENTS PLC
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN
EQUITY
FOR THE SIX MONTHSED 30 SEPTEMBER 2020
Retained
Share capital Share premium earnings Total equity
GBP'000 GBP'000 GBP'000 GBP'000
31 March 2019 13,101 5,681 1,214 19,996
Loss after tax and total comprehensive
income - - (67) (67)
Equity settled share based
payments - - 131 131
Dividend payment - - (58) (58)
------------- -------------- --------------- --------------
30 September 2019 13,101 5,681 1,220 20,002
-------------- -------------- -------------- --------------
Issue of shares 325 325 - 650
Cost of share issue - (5) - (5)
Loss after tax, adjustments
and total comprehensive income - - (5,341) (5,341)
Equity settled share based
payments - - 98 98
-------------- -------------- -------------- --------------
31 March 2020 13,426 6,001 (4,023) 15,404
-------------- -------------- -------------- --------------
Loss after tax and total comprehensive
income - - (429) (429)
Equity settled share based
payments - - 13 13
-------------- -------------- -------------- --------------
30 September 2020 13,426 6,001 (4,439) 14,988
-------------- -------------- -------------- --------------
TAVISTOCK INVESTMENTS PLC
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH
FLOWS
FOR THE SIX MONTHSED 30 SEPTEMBER 2020
Unaudited Unaudited
6 months ended 6 months ended
30 September 2020 30 September 2019
GBP'000 GBP'000 GBP'000 GBP'000
Cash flows from operating
activities
Loss before tax
Adjustments for: (416) (132)
Share based payments 13 131
Depreciation on fixed assets 233 272
Amortisation of intangible assets 93 483
Impairment - 133
Restructuring reserve 1,200 -
Net finance costs 115 119
----------------- -----------------
Cash flows from operating
activities
before changes 1,238 1,006
in working capital
Increase in trade and other
receivables (2,328) (1,384)
Increase in trade and other
payables 1,875 1,386
----------------- -----------------
Cash used in operations 785 1,008
Investing activities
Purchase of fixed assets (101) (856)
Purchase of intangible assets (762) (2,661)
Payments due regarding purchase
of clients lists 505 1,622
Deferred consideration payments (687) (520)
----------------- -----------------
Net cash generated from investing
activities (1,045) (2,415)
Financing activities
Finance costs (115) (119)
New loans 2,130 -
Leases (135) 676
Loan repayments (62) (230)
Dividend payment - (58)
----------------- -----------------
Net cash from financing
activities 1,818 269
----------------- -----------------
Net increase/(decrease) in cash
and cash equivalents 1,558 (1,138)
Cash and cash equivalents at
beginning
of the period 2,416 3,116
------------------ ------------------
Cash and cash equivalents at end
of the period 3,974 1,978
========= =========
TAVISTOCK INVESTMENTS PLC
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
FOR THE SIX MONTHSED 30 SEPTEMBER 2020
1. ACCOUNTING POLICIES
Basis of preparation
The interim condensed consolidated financial statements have
been prepared in accordance with the recognition and measurement
requirements of International Financial Reporting Standards (IFRS)
and IFRIC interpretations issued by the International Accounting
Standards Board (IASB) adopted by the European Union.
The accounts have been prepared in accordance with accounting
policies that are consistent with the March 2020 Report and
Accounts and that are expected to be applied in the Report and
Accounts of the year ended 31 March 2021.
This report is not prepared in accordance with IAS 34, which is
not mandatory. The financial information does not constitute
statutory accounts within the meaning of section 435 of the
Companies Act 2006. Statutory accounts for Tavistock Investments
Plc for the year ended 31 March 2020 have been delivered to the
Registrar of Companies. The auditors' report on those accounts was
unqualified, did not draw attention to any matters by way of
emphasis and did not contain a statement under Section 498 (2) or
(3) of the Companies Act 2006.
2. SEGMENTAL INFORMATION
A segmental analysis of revenue and expenditure for the period
is:
Unaudited Unaudited
Investment Advisory 30 September 30 September
Management Support 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Revenue 2,704 10,676 13,380 14,311
Cost of Sales (216) (7,444) (7,660) (8,500)
Administrative Expenses (804) (3,034) (3,838) (4,674)
Group costs (2,183) (1,150)
------------- -------------
Loss from operations (301) (13)
====== ======
The segmental analysis above reflects the parameters applied by
the Board when considering the Group's monthly management accounts.
The Directors do not consider a division of the statement of
financial position to be appropriate or useful for the purposes of
understanding the financial performance and position of the
Group.
During the period under review the Group operated and earned
revenue exclusively within the UK.
3. LOSS PER SHARE Unaudited Unaudited
6 months ended 6 months ended
30 September 30 September
2020 2019
Loss per share has been calculated using
the following:
Loss from continuing operations (GBP'000) (416) (78)
Weighted average number of shares ('000s) 607,796 575,296
-------------- --------------
Basic loss per ordinary share (0.07)p (0.01)p
======= =======
4. INTANGIBLE ASSETS Regulatory Goodwill Internally
Client Approvals Arising Developed
on
Lists & Systems Consolidation Assets Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
Balance at 1 April
2020
(Audited) 8,408 1,815 14,751 2,249 27,223
Additions 505 - - 257 762
------------- ------------- ------------- ------------ ---------------
Balance at 30
September
2020 8,913 1,815 14,751 2,506 27,985
(Unaudited) ------------- ------------- ------------ ------------ ---------------
Accumulated
amortisation
Balance at 1 April
2020
(Audited) 7,039 1,815 235 1,227 10,316
Amortisation 91 - - 2 93
------------ ------------ ----------- ------------ ---------------
Balance at 30
September
2020 7,130 1,815 235 1,229 10,409
(Unaudited) ----------- ----------- ------------ ------------ ---------------
Net Book Value
At 1 April 2020
(Audited) 1,369 - 14,516 1,022 16,907
====== ====== ====== ====== =======
At 30 September 2020 1,783 - 14,516 1,277 17,576
(Unaudited) ====== ====== ====== ====== =======
5. SHARE CAPITAL Unaudited Audited
30 September 31 March
2020 2020
GBP'000 GBP'000
Called up share capital
Allotted, called up and fully paid
607,795,801 Ordinary shares of 1 pence
each 6,078 6,078
30,450,078 Deferred shares of 9 pence
each 2,741 2,741
465,344,739 Deferred "A" shares of 0.99
pence each 4,607 4,607
------------ ------------
13,426 13,426
====== ======
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.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
IR BKLFBBFLXFBB
(END) Dow Jones Newswires
November 10, 2020 02:00 ET (07:00 GMT)
Tavistock Investments (LSE:TAVI)
Historical Stock Chart
From Apr 2024 to May 2024
Tavistock Investments (LSE:TAVI)
Historical Stock Chart
From May 2023 to May 2024