Half-yearly Report
27 September 2012
Norman Broadbent plc
("Norman Broadbent" or "the Company")
Norman Broadbent, a leading provider of executive search and leadership
consultancy services, today announces its unaudited results for the six months
ended 30 June 2012.
Financial highlights
* Group revenue increased to £4.0m from £3.5m for the six months ended 30
June 2011, an increase of 15 per cent.
* Core UK executive search revenues increased 20 per cent. to £3.5m from
£2.9m in 2011
* Operating profit of £0.26m before restructuring costs, compared with £0.45m
in 2011
* Equity shareholders' funds increased to £2.4m from £2.3m at 31 December
2011.
Operational highlights
* UK executive search business continues to build market share, despite a
difficult trading environment
* New subsidiaries established in the United States and Singapore.
* Discussions with potential acquisition targets and teams are underway with
progress expected before the year end
Pierce Casey, Executive Chairman, said:
"Despite a challenging market we were pleased to grow UK executive search
revenues by 20% over the corresponding period. We aim to continue to build
market share in executive search and are optimistic about our plans to create a
diversified, human capital group over the next twelve months."
For further information please contact:
Norman Broadbent plc Tel: 020 7484 0000
Pierce Casey/Sue O'Brien/Ben Felton
Merchant Securities Limited Tel: 020 7628 2200
Simon Clements/Virginia Bull
Notes to Editors
Norman Broadbent plc is a leading provider of executive search and leadership
consultancy services. It offers board and executive search services, interim
management services and leadership consultancy services, such as executive
assessment and development, talent management, and executive coaching services.
Headquartered in London, the group operates globally and has offices in
Barcelona, Bogota, Dublin, Limassol, Milan, Madrid, Singapore, Los Angeles and
across the Middle East.
For further information visit www.normanbroadbent.com
Chairman's Statement
Introduction
Following our share placing in May 2011, which raised £1.75m, Norman Broadbent
plc (the "Company" or the "Group") embarked on a fundamental restructure and
expansion of the core UK executive search business through the appointment of
10 senior executives, the creation of a dedicated board and non-executive
search practice, and geographical expansion with the opening of modest offices
in Singapore and the United States.
Market conditions for the search industry in the UK and rest of Europe in the
first six months of 2012 have been very challenging. This has been reflected in
the results and commentary of our competitors, with two global search firms
publically traded in the United States showing significant European revenue
declines in the first six months of 2012.
In that context it is very pleasing to note that, despite anticipating it
taking up to 18 months for new teams to reach full productivity, our core
executive search revenues in the UK increased 20 per cent in the six months to
30 June 2012. The strategy, initiated in 2011, to reposition Norman Broadbent
as a Tier 1 search firm was prescient as the market has demonstrably moved to
favour firms that offer excellent service via seasoned professional consultants
and provide innovative business solutions. The Board greatly appreciates the
combination of ability, strong work ethic and persistence of all our team from
managing directors to support staff.
Our mission is twofold; we aim to support our existing team as it continues to
build market share and reach full productivity while developing new offerings
both in the UK and abroad.
Financial Results
The table below summarises the results for the Group.
Six months to Six months to Year ended
30 June 30 June 31 Dec
2012 2011 2011
£000's £000's £000's
REVENUE 4,014 3,490 6,900
Cost of Sale (116) (42) (109)
GROSS PROFIT 3,898 3,448 6,791
Operating Expenses (3,643) (3,023) (6,515)
Other Income 0 27 25
GROUP OPERATING PROFIT BEFORE 255 452 301
RESTRUCTURING COSTS
Restructuring costs (189) (410) (802)
GROUP OPERATING PROFIT 66 42 (501)
Net Finance Cost (16) (6) (34)
Profit Before Tax 50 36 (535)
Income tax (7) (6) (26)
Profit After Tax 43 30 (561)
Group operating profit before restructuring costs declined to £255,000 during
the period (£452,000 for six months ended 30 June 2011) due to the higher UK
cost base and modest start-up costs in Singapore and the US.
Total revenue grew by 15 per cent, while core UK executive search revenue grew
by 20 per cent. Operating expenses grew by 20 per cent reflecting the higher
salary costs of the new team combined with the incremental costs of operating
in two new overseas territories. Restructuring costs of £189,000, relating to
residual sign-on commissions were 54 per cent. lower than the comparative
period and will be fully amortised by the year end.
Earnings per share for the six months to 30 June 2012 increased to 0.40 pence
per share compared with 0.37 pence in the comparative period and adjusted
earnings per share increased to 0.89 pence from 0.67 pence in 2011.
Financial Position
Net assets increased marginally to £2.4m as at 30 June 2012 (£2.3m as at 31
December 2011). Net current assets were £0.58m as at 30 June 2012 (£0.47m as at
31 December 2011). Cash at £0.58m was down marginally (£0.65m as at 31 December
2011), whilst invoice discounting increased to £1.0m, reflecting the higher
trade receivables balance of £1.6m (£1.2m at 31 December 2011) built up over a
busy trading quarter. Bank debt was a modest £59,000 at 30 June 2012 (£109,000
at 31 December 2011).
Strategy and Business Development
The search business is by its nature highly operationally geared with
substantial fixed costs associated with the provision of high level service to
our clients. We believe that as our offering matures, the UK search business is
well placed to continue to grow its revenue and market share resulting in
increased profitability. The timing of achieving optimum levels of
profitability in the business is also clearly dependent on an overall
improvement in market conditions.
Internationally we intend to develop our new subsidiaries in Singapore and the
United States from their existing small bases. Through our Spanish business we
have gained exposure to Latin America; in this regard, the opening in Columbia
has got off to an encouraging start. In due course, we anticipate further
market penetration into Latin America.
We continue to look at development opportunities both in the UK and abroad. A
number of discussions with potential acquisition targets and teams are underway
and we are hopeful of progress on this front before the year end. We believe we
can create a broader based human capital group with modest capital investment.
Current Trading and Outlook
The 20 per cent. growth in executive search revenue in the six months was
encouraging. This was achieved despite the impact of an unexpectedly slow
trading month in June 2012, also experienced by a number of our competitors. In
view of the fact that the traditionally quiet July / August period coincided
with the Olympic Games in London, we were pleased with revenues for this
period.
Recent data on UK and European growth prospects suggest a robust recovery is
some way off. However, September revenues look satisfactory and the outlook for
the last quarter of 2012 appears encouraging, albeit there is limited
visibility particularly in view of heightened geo-political tensions and
macroeconomic uncertainties across the globe.
Pierce Casey
Executive Chairman
27 September 2012
Consolidated Statement of Comprehensive Income
for the six month period ended 30 June 2012
Note Six months Six months Year ended
ended ended 31
December
30 June 30 June 2011
2012 2011 (audited)
(unaudited) (unaudited)
£000 £000 £000
REVENUE 3 4,014 3,490 6,900
Cost of sales (116) (42) (109)
GROSS PROFIT 3,898 3,448 6,791
Operating expenses (3,643) (3,023) (6,515)
Other income - 27 25
GROUP OPERATING PROFIT BEFORE 255 452 301
RESTRUCTURING COSTS
Re-structuring costs 4 (189) (410) (802)
GROUP OPERATING PROFIT/(LOSS) 66 42 (501)
Net finance cost (16) (6) (34)
PROFIT/(LOSS) ON ORDINARY ACTIVITIES 50 36 (535)
BEFORE INCOME TAX
Income tax expense (7) (6) (26)
PROFIT/(LOSS) FOR THE PERIOD 43 30 (561)
Earnings/(loss) per share
- Basic 6 0.40p 0.37p (5.96)p
- Diluted 0.40p 0.36p (5.96)p
Adjusted earnings/(loss) per share
- Basic 6 0.89p 0.67p (5.16)p
- Diluted 0.89p 0.66p (5.16)p
There are no recognised gains and losses other than as stated above.
Consolidated Statement of Financial Position
As at 30 June 2012
As at As at As at
30 June 30 June 31 December
2012 2011 2011
(Unaudited) (Unaudited) (Audited)
£000 £000 £000
Non-Current Assets
Intangible assets 1,810 1,810 1,810
Property, plant and equipment 114 147 131
Deferred tax assets 69 69 69
TOTAL NON-CURRENT ASSETS 1,993 2,026 2,010
Current Assets
Trade and other receivables 2,652 2,185 1,829
Cash and cash equivalents 583 1,530 650
TOTAL CURRENT ASSETS 3,235 3,715 2,479
TOTAL ASSETS 5,228 5,741 4,489
Current Liabilities
Trade and other payables 1,280 1,237 980
Deferred consideration 300 250 300
Bank overdraft and interest bearing 1,079 778 734
loans
TOTAL CURRENT LIABILITIES 2,659 2,265 2,014
Non-Current Liabilities
Deferred consideration 181 613 181
Interest bearing loans - 50 -
TOTAL NON-CURRENT LIABILITIES 181 663 181
TOTAL LIABILITIES 2,840 2,928 2,195
TOTAL ASSETS LESS TOTAL
LIABILITIES 2,388 2,813 2,294
Issued share capital 5,833 5,833 5,833
Share premium account 8,758 8,736 8,758
Retained earnings (12,203) (11,756) (12,297)
TOTAL EQUITY 2,388 2,813 2,294
Consolidated Statement of Changes in Equity
For the six month period ended 30 June 2012
Attributable to equity holders of the
business
Share Share Retained Total
Premium Earnings
Capital Equity
£000 £000
£000 £000
Balance at 1 January 2011 5,804 6,985 (11,811) 978
Profit for the period - - 30 30
Total recognised income and expense - - 30 30
for the period
Issue of ordinary shares 29 1,805 - 1,834
Costs relating to issue of shares - (54) - (54)
Credit to equity for share based - - 25 25
payments
Balance at 30 June 2011 5,833 8,736 (11,756) 2,813
Balance at 1 July 2011 5,833 8,736 (11,756) 2,813
Loss for the period - - (591) (591)
Total recognised income and expense - - (591) (591)
for the period
Issue of ordinary shares - 22 - 22
Costs relating to issue of shares - - - -
Credit to equity for share based - - 50 50
payments
Balance at 31 December 2011 5,833 8,758 (12,297) 2,294
Balance at 1 January 2012 5,833 8,758 (12,297) 2,294
Profit for the period - - 43 43
Total recognised income and expense - - 43 43
for the period
Issue of ordinary shares - - - -
Costs relating to share issue - - - -
Credit to equity for share based - - 51 51
payments
Balance at 30 June 2012 5,833 8,758 (12,203) 2,388
Consolidated Statement of Cashflows
For the six month period ended 30 June 2012
Six months Six months Year ended
31 December
ended ended 2011
30 June 30 June (Audited)
2012 2011
(Unaudited) (Unaudited)
£000 £000 £000
Net cash used in operating activities (i) (372) (196) (561)
Cash flows from investing activities
and servicing of finance
Net finance cost (16) (6) (35)
Dividends received - 27 25
Payments to acquire tangible fixed (24) (14) (33)
assets
Repayment of deferred consideration - (146) (528)
Net cash used in investing activities (40) (139) (571)
Cash flows from financing activities
Net cash inflows from equity placing - 1,740 1,750
(Repayment)/increase in secured loans (50) 20 (116)
Repayment of directors' loans - (7) (7)
Increase /(decrease) in invoice 395 (28) 14
discounting
Net cash from financing activities 345 1,725 1,641
Net (decrease)/increase in cash and (67) 1,390 510
cash equivalents
Net cash and cash equivalents at 650 140 140
beginning of period
Net cash and cash equivalents at end 583 1,530 650
of period
Analysis of net funds
Cash and cash equivalents 583 1,530 650
Borrowings due within one year (1,079) (778) (734)
Borrowings due after one year - (50) -
Deferred consideration (481) (863) (481)
Net funds (977) (161) (565)
Note (i) Six months Six months Year ended
Reconciliation of operating profit to ended ended 31 December
net cash from operating activities 30 June 30 June 2011
2012 2011 (audited)
(unaudited) (unaudited)
Operating profit/(loss) 66 42 (501)
Depreciation / impairment of property, 41 44 79
plant and equipment
Share based payment charge 51 25 75
Dividends received - (27) (25)
(Increase) /decrease in trade and (823) (213) 144
other receivables
Increase /(decrease) in trade and 300 (66) (306)
other payables
Loss on disposal of investment - 5 -
Taxation paid (7) (6) (27)
Net cash used in operating activities (372) (196) (561)
Notes to the Financial Statements
1. ACCOUNTING POLICIES
1.1 Basis of preparation
The financial information set out in this interim report does not constitute
statutory accounts as defined in Section 434 of the Companies Act 2006. The
Group's statutory financial statements for the year ended 31 December 2011,
prepared under International Financial Reporting Standards (IFRS), have been
filed with the Registrar of Companies. The auditor's report on those statements
was unqualified.
The interim financial information for the six months ended 30 June 2012, has
been prepared in accordance with the AIM Rules for Companies. The Group has not
elected to apply IAS 34 `Interim Financial Reporting'. The principal accounting
policies used in preparing the interim results are those the Group expects to
apply in its financial statements for the year ending 31 December 2012 and are
unchanged from those disclosed in the Group's Annual Report for the year ended
31 December 2011. The interim financial statements have not been audited.
1.2 Basis of consolidation and business combinations
The Group financial statements consolidate those of the Company and of the
following subsidiary undertakings:
Principal Group Country of Principal Description and
investments: activities proportion of
incorporation shares held by the
or Company
registration
and
operation
Norman Broadbent England and Executive search 100% ordinary
Executive Search Ltd Wales shares
Norman Broadbent Overseas England and Executive search 100% ordinary
Ltd Wales shares
Human Asset Development England and Assessment, 100% ordinary
International Ltd Wales coaching and shares
talent mgmt.
Norman Broadbent Inc United States Executive Search 100% ordinary
of America shares
The NB Consultancy Republic of Executive Search 100% ordinary
(Singapore) Pte Ltd Singapore shares
Norman Broadbent Republic of Executive Search 100% ordinary
(Ireland) Ltd Ireland shares
Bancomm Ltd England and Dormant 100% ordinary
Wales shares
NBBI Limited* England and Dormant 100% ordinary
Wales shares
Substantial
Shareholdings:
NBS Norman Broadbent SA** Spain Executive Search 20% ordinary shares
* The 100% shareholding in this company is owned by Norman Broadbent Executive
Search Ltd, a wholly owned subsidiary of the Company.
** The 20% shareholding in this company is owned by Norman Broadbent Overseas
Ltd, a wholly owned subsidiary of the Company.
2. COPIES OF THE UNAUDITED INTERIM REPORT
Copies of this report are available on request from the Company's registered
office at 12 St James's Square, London, SW1Y 4LB and are also available on the
Company's website at www.normanbroadbent.com.
3. SEGMENTAL ANALYSIS
Management has determined the operating segments based on the reports reviewed
regularly by the board for use in deciding how to allocate resources and in
assessing performance. The Board considers Group operations from both a class
of business and geographic perspective.
Each class of business derives its revenues from the supply of a particular
recruitment related service, from retained executive search through to
executive assessment and coaching. Business segment results are reviewed
primarily to operating profit level, which includes employee costs, marketing,
office and accommodation costs and appropriate recharges for management time.
Group revenues are primarily driven from UK operations however, when revenue is
derived from overseas business the results are presented to the Board by
geographic region to identify potential areas for growth or those posing
potential risks to the Group.
i) Class of Business:
The analysis by class of business of the Group's turnover, profit before
taxation and net assets/ (liabilities) is set out below:
BUSINESS SEGMENTS
Six months ended 30 Executive Overseas Interim Assessment, Unallocated Total
June 2012 Royalties coaching &
Search £000 talent £000 £000
£000 mgmt.
£000 £000
Revenue 3,500 189 73 252 - 4,014
Cost of sales (84) - - (32) - (116)
Gross profit 3,416 189 73 220 - 3,898
Operating expenses (3,041) (86) (10) (313) (152) (3,602)
Other operating - - - - - -
income
Re-structuring costs (189) - - - - (189)
Finance costs (16) - - - - (16)
Depreciation and (41) - - - - (41)
amortisation
Profit before tax 129 103 63 (93) (152) 50
Net assets 2,497 - - (109) - 2,388
BUSINESS SEGMENTS
Six months ended 30 Executive Overseas Interim Assessment, Unallocated Total
June 2011 Search Royalties coaching &
£000 talent £000 £000
£000 £000 mgmt.
£000
Revenue 2,945 191 47 307 - 3,490
Cost of sales (4) - - (38) - (42)
Gross profit 2,941 191 47 269 - 3,448
Operating expenses (2,463) (115) - (303) (94) (2,975)
Other operating 27 - - - - 27
income
Re-structuring costs (270) - - - (140) (410)
Finance costs (6) - - - - (6)
Depreciation and (48) - - - - (48)
amortisation
Profit before tax 181 76 47 (34) (234) 36
Net assets 2,816 - - (3) - 2,813
BUSINESS SEGMENTS
Year ended 31 Executive Overseas Interim Assessment, Unallocated Total
December 2011 Search Royalties coaching &
£000 talent £000 £000
£000 £000 mgmt.
£000
Revenue 5,929 333 47 591 - 6,900
Cost of sales (50) - - (59) - (109)
Gross profit 5,879 333 47 532 - 6,791
Operating expenses (5,336) (119) - (580) (401) (6,436)
Other operating 25 - - - - 25
income
Re-structuring costs (512) (290) (802)
Finance costs (34) - - - - (34)
Depreciation and (79) - - - - (79)
amortisation
Profit before tax (57) 214 47 (48) (691) (535)
Net assets 2,312 - - (18) - 2,294
ii) Geographic Region:
The analysis by geographic region of the Group's turnover, profit before
taxation and net assets/ (liabilities) is set out below:
BUSINESS SEGMENTS
Six month period Executive Overseas Interim Assessment, Unallocated Total
ended 30 June 2012 Search Royalties coaching &
£000 talent £000 £000
£000 £000 mgmt.
£000
Revenue
United Kingdom 3,330 - 44 252 - 3,626
Europe 121 133 15 - - 269
Other 49 56 14 - - 119
Total 3,500 189 73 252 - 4,014
Gross profit
United Kingdom 3,248 - 44 220 - 3,512
Europe 122 133 15 - - 270
Other 46 56 14 - - 116
Total 3,416 189 73 220 - 3,898
Profit/(Loss) before
tax
United Kingdom 174 - 38 (93) (152) (33)
Europe - 72 13 - - 85
Other (45) 31 12 - - (2)
Total 129 103 63 (93) (152) 50
Net assets
United Kingdom 2,535 - - (109) - 2,426
Europe - - - - - -
Other (38) - - - - (38)
Total 2,497 - - (109) - 2,388
BUSINESS SEGMENTS
Six month period Executive Overseas Interim Assessment, Unallocated Total
ended 30 June 2011 Search Royalties coaching &
£000 talent £000 £000
£000 £000 mgmt.
£000
Revenue
United Kingdom 2,574 - 34 195 - 2,803
Europe 313 140 10 112 - 575
Other 58 51 3 - - 112
Total 2,945 191 47 307 - 3,490
Gross profit
United Kingdom 2,570 - 34 169 - 2,773
Europe 313 140 10 100 - 563
Other 58 51 3 - - 112
Total 2,941 191 47 269 - 3,448
Profit/(Loss) before
tax
United Kingdom 181 - 34 (34) (234) (53)
Europe - 54 10 - - 64
Other - 22 3 - - 25
Total 181 76 47 (34) (234) 36
Net liabilities
United Kingdom 2,816 - - (3) - 2,813
Total 2,816 - - (3) - 2,813
BUSINESS SEGMENTS
Year ended 31 Executive Overseas Interim Assessment, Unallocated Total
December 2011 Search Royalties coaching &
£000 talent £000 £000
£000 £000 mgmt.
£000
Revenue
United Kingdom 5,284 - 34 356 - 5,674
Europe 333 263 10 235 - 841
Other 312 70 3 - - 385
Total 5,929 333 47 591 - 6,900
Gross profit
United Kingdom 5,234 - 34 309 - 5,577
Europe 333 263 10 223 - 829
Other 312 70 3 - - 385
Total 5,879 333 47 532 - 6,791
Profit/(Loss) before
tax
United Kingdom (57) - 34 (40) (691) (754)
Europe - 164 10 (8) - 166
Other - 50 3 - - 53
Total (57) 214 47 (48) (691) (535)
Net liabilities
United Kingdom 2,312 - - (18) - 2,294
Total 2,312 - - (18) - 2,294
Turnover by location is not materially different from turnover by destination.
The unallocated costs refer to central costs of the Group including salaries,
professional and other costs, which are not directly attributable to the
delivery of the services. The four segments shown represent the management
information provided to the Board and in the opinion of the directors reflect
the nature of the Group's services.
4. RE-STRUCTURING COSTS
Re-structuring costs include personnel costs relating to the hiring of new
consultants, exiting of under-performing staff and external recruitment
consultancy costs relating to the new hires.
These items have been highlighted in the consolidated statement of
comprehensive income because separate disclosure is considered appropriate in
understanding the underlying performance of the business.
Six months Six months Year ended
ended ended 31 December
30 June 30 June 2011
2012 2011 £000
£000 £000
Personnel 189 335 677
Consultancy - 75 125
Total 189 410 802
5. EQUITY SECURITIES ISSUED
During the six month period ended 30 June 2012 no equity securities were
issued. During the six month period ended 30 June 2011, the following equity
securities were issued:
* On 31 March 2011 Mr C Auld, an existing shareholder, exercised warrants
over 97,777 ordinary shares of 1p at a price of 45p per share.
* On 30 April 2011 a resolution was passed at the company's Annual General
Meeting, approving the placing of 2,692,308 ordinary shares of 1p for a
total consideration of £1.75 million.
* On 13 May 2011 61,069 ordinary shares of 1p were issued at a price of 65.5p
per share to an employee in lieu of a bonus.
* On 13 May 2011 the Company issued 1,037,832 options over ordinary shares of
1p to employees and certain members of the Board. The exercise price is
65.5p and the options vest in equal tranches over the next 3 years.
An analysis of all ordinary shares issued during the period is shown below:
Issue of ordinary shares during Six months Six months Year ended
the period ended ended 31 December
30 June 2012 30 June 2011 2011
(unaudited) (unaudited) (audited)
Shares Value Shares Value Shares Value
000's £000 000's £000 000's £000
Issue of shares on exercise of - - 98 44 118 54
warrants/options
Issue of shares in lieu of - - 61 40 79 52
employee bonus
Issue of shares for cash - - 2,692 1,750 2,692 1,750
Total - - 2,851 1,834 2,889 1,856
6. EARNINGS PER ORDINARY SHARE
i. Basic earnings per share:
This is calculated by dividing the profit attributable to equity holders of the
company by the weighted average number of ordinary shares in issue during the
period:
Six months Six months Year ended
ended ended 31 December
30 June 30 June 2011
2012 2011
(unaudited) (unaudited) (audited)
Profit/(Loss) attributable to £43,000 £30,000 £(561,000)
shareholders
Weighted average number of ordinary 10,607,801 8,233,881 9,416,510
shares
ii) Diluted earnings per share:
This is calculated by adjusting the weighted average number of ordinary shares
outstanding to assume conversion of all dilutive potential ordinary shares. The
company has two categories of dilutive potential ordinary shares; share options
and warrants. For these options and warrants, a calculation is done to
determine the number of shares that could have been acquired at fair value
(determined as the average annual market share price of the company's shares)
based on the monetary value of the subscription rights attached to the
outstanding warrants and options. The number of shares calculated as above is
compared with the number of shares that would have been issued assuming the
exercise of the share options.
Six months Six months Year ended
ended ended 31 December
30 June 30 June 2011
2012 2011
(unaudited) (unaudited) (audited)
Profit/(Loss) attributable to £43,000 £30,000 £(561,000)
shareholders
Weighted average no. of ordinary 10,607,801 8,233,881 9,416,510
shares
- assumed conversion of share options - 68,823 49,272
- assumed conversion of warrants 3,076 55,122 55,343
Weighted average number of ordinary 10,610,877 8,357,826 9,521,125
shares for diluted earnings per share
iii) Adjusted earnings per share
Adjusted earnings per share has also been calculated in addition to the basic
and diluted earnings per share and is based on earnings adjusted to eliminate
the effects of impairment of intangibles and charges for share based payments.
It has been calculated to allow shareholders to gain a clearer understanding of
the trading performance of the Group.
Six months ended 30 Six months ended 30 Year ended 31
June 2012 June 2011 December 2011
£000 Basic Diluted £000 Basic Diluted £000 Basic Diluted
pence pence pence pence pence pence
per per per per per per
share share share share share share
Basic earnings
Profit after tax 43 0.40 0.40 30 0.37 0.36 (561) (5.96) (5.96)
Adjustment
Share based 51 0.49 0.49 25 0.30 0.30 75 0.80 0.80
payment charge
Adjusted earnings 94 0.89 0.89 55 0.67 0.66 (486) (5.16) (5.16)
7. RELATED PARTY TRANSACTIONS
i. Purchase of services:
Six months Six months Year ended
ended ended 31 December
30 June 30 June 2011
2012 2011 £000
£000 £000
Adelaide Capital Limited 73 96 166
Anderson Barrowcliff LLP 15 15 35
Andrew Garner Associates Limited - 112 261
Total 88 223 462
Adelaide Capital Limited invoiced the Group for the directors' fees (P Casey £
63,000, B Stephens £10,000). P Casey and B Stephens are directors of Adelaide
Capital Limited.
Taxation and company secretarial services of £5,000 were acquired from Anderson
Barrowcliff LLP, an accountancy firm of which R Robinson is a partner. Anderson
Barrowcliff also invoices the Group for R Robinson's director's fees (£10,000).
Andrew Garner Associates Limited invoiced the Group for the director's fees and
business related expenses of A C Garner, a former director of the Company,
during 2011. A C Garner is a director of Andrew Garner Associates Limited.
ii. Period-end payables arising from the purchases of services:
Six months Six months Year ended
ended ended 31 December
30 June 30 June 2011
2012 2011 £000
£000 £000
Adelaide Capital Limited 12 46 19
Anderson Barrowcliff LLP 6 19 4
Total 18 65 23
The payables to related parties arise from purchase transactions and are due
one month after date of purchase. The payables bear no interest.
iii) Loans from related parties:
In order to assist the working capital position, certain directors and
shareholders advanced loans to the Group, which are non-interest bearing and
have no formal repayment terms.
Six months Six months Year ended
ended ended 31 December
30 June 30 June 2011
2012 2011 £000
£000 £000
Beginning of period - 7 7
Loans repaid during the period - (7) (7)
End of period - - -
iv) Personal guarantees from related parties:
At 30 June 2012 A C Garner, a shareholder and former director of the Company
had a £59,000 personal guarantee as security for the Group's bank loan.
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