Half-year Report

RNS Number : 1120D
Fiske PLC
28 February 2022
 

28 February 2022

FISKE PLC

("Fiske" or the "Company" or the "Group")

Interim results

Fiske ( AIM:FKE ) is pleased to announce its interim results for the six months ended 30 November 2021.

 

In accordance with rule 26 of the AIM Rules for Companies this information is also available, under the Investors section, at the Company's website, http://www.fiskeplc.com .

 

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 

For further information, please contact:

 

Fiske PLC
James Harrison (CEO) Tel: +44 (0) 20 7448 4700
100 Wood Street

London

EC2V 7AN


Grant Thornton UK LLP (Nominated Adviser) Tel: +44 (0) 20 7383 5100
Samantha Harrison / Harrison Clarke / Samuel Littler

 

 

Trading

 

In the half year to November 2021 UK markets were broadly level, and market activity was generally quieter.

 

However, our investment management fee income, which now represents 55% of our revenues, rose noticeably over the period.  Our investment performance and new client wins over the six months to November 2021 resulted in our investment management fee income being ahead, by some 17%, of the equivalent period to November 2020.

 

In contrast, and as a result of less volatile market conditions, our commission revenues were softer when compared to the previous six months to May 2021.  Although they were around the same level as for the comparable period to November 2020.  Overall, our revenues for the half year were £2.9m which is 6% higher than for the equivalent prior year period to November 2020.

 

Our operating expenses increased during the period partly due to relocation costs and partly due to restructuring costs incurred in anticipation of a smaller office footprint.  At the end of November, we moved to new modern offices at 100 Wood Street after spending some 45 years at Salisbury House.  We expect to benefit from the reduction in overall property costs in the second half of our financial year which will now run to 30 June 2022.  This follows our recent decision to change our accounting year end to 30 June.

 

Following an internal review of the results for the first half of the year, the Directors of the Company determined that certain one-off adjustments needed to be made to its accounts for the prior financial period.  These are related to the method of computation of accrued management fee revenue.  There has been no impact on the client money or asset positions of our clients, and no impact on the Company's cash position.  As a consequence, group revenues for the year to May 2021 have been restated downwards by 4% and balance sheets commensurately corrected.  Comparative data in this report has been restated and the adjustments elaborated in notes to the accounts and the comments in this statement reflect these changes.

 

Overall, our operating results for the half year to 30 November 2021 show a loss of £179,000 compared to the restated loss of £97,000 in the half year to November 2020.  Our pre-tax losses were £6,000 (November 2020:restated loss of £103,000) for the period following receipt of the dividend of £183,000 for our shareholding in Euroclear.

 

Our cash balances continue to rise, reaching £3.6m at the end of November.

 

Markets

 

The final three months of the calendar year 2021 produced the UK's fifth consecutive positive quarterly equity market return despite increased volatility created by the emergence of the Omicron variant of Covid-19.  Although more transmissible and infectious, it would seem it is less virulent, and that vaccinations and boosters have produced the level of protection hoped for.

 

With the market impact of the pandemic beginning to recede, inflation has now become a major concern and increasingly central banks are accepting that the current increase is not transitory and are responding by raising interest rates and/or by withdrawing Covid induced financial support measures and monetary stimulus.  Higher commodity and energy prices, rising demand, supply chain disruption and wage pressures are just some of the issues driving up the cost of living

 

On the geo-political front, the invasion of Ukraine by Russian troops and the imposition of sanctions on Russia by Western nations is also of concern.  The failure to find a diplomatic solution before Russian troops crossed the Ukrainian border might also embolden China to make more aggressive moves on Taiwan.

 

Since the turn of the year, market leadership has also shifted dramatically away from highly valued US technology growth stocks and pandemic beneficiaries towards higher yielding value situations found in the "old economy" sectors that are so predominant in the UK equity market.  The relatively low ratings of many of the UK's major companies is also attracting the interest of activist investors.  As a result, the US and UK markets have become disconnected with the latter moving ahead whilst the US market and the NASDAQ market are falling. 

 

Outlook

 

We expect to see continuing turbulence in markets.  Many shares that comprise the NASDAQ index have experienced a torrid time of late with some substantial intraday falls leading to major value destruction.  This trend may continue for a while as speculative positions unwind, and share price ratings fall back to more realistic levels.

 

Interest rates are almost certain to rise further over the next 12 months, albeit from historically low levels.  Against a backdrop of rising inflation rates, investment in real assets particularly in shares trading at reasonable valuations in companies with enough pricing power to underpin real earnings growth is likely to find favour.  Overall, we look forward to identifying attractive investment opportunities for our clients that will no doubt be forthcoming in the coming months.

 

From an operational standpoint we are settling into our new offices well and look forward to the benefits that our reduced property costs and non-recurring restructuring costs will provide for the further development of the business.

 

Clive Fiske Harrison  James P Q Harrison

Chairman                                                                         Chief Executive Officer

28 February 2022

 
 

 

Condensed Consolidated Statement of Total Comprehensive Income

For the six months ended 30 November 2021

 

 

 

 

Note

Six months ended

30 November 2021

Unaudited

Six months ended

30 November 2020

Unaudited

Year ended

31 May 2021

  Audited

 

 

£'000

 

£'000

(restated)

£'000

(restated)

Revenues

2

2,856

2,699

5,854

Operating expenses

 

(3,035)

(2,796)

(5,716)

Operating (Loss)/Profit

 

(179)

(97)

138

Investment revenue

 

183

-

237

Finance income

-

-

-

Finance costs

(10)

(6)

(9)

(Loss)/Profit on ordinary activities before taxation

 

(6)

(103)

366

Taxation

 

0

1

(43)

(Loss)/Profit on ordinary activities after taxation

 

(6)

(102)

323

Other comprehensive (expense)/ income

 

 

 

 

Items that may subsequently be reclassified to profit or loss

 

 

 

Movement in unrealised appreciation of investments

(35)

222

75

Deferred tax on movement in unrealised appreciation of investments

 

(162)

 

(37)

 

(12)

Net other comprehensive (expense)/income

 

(197)

185

63

Total comprehensive (loss)/income for the period/year attributable to equity shareholders

 

(203)

 

83

 

386

Profit / (Loss) Earnings per ordinary share (pence)

3

 

 

 

Basic

(0.1)p

(0.9)p

2.8p

Diluted

(0.1)p

(0.9)p

2.8p

 

All results are from continuing operations and are attributable to equity shareholders of the parent Company.

 

 

Condensed Consolidated Statement of Financial Position

30 November 2021

 

 

 

 

As at

30 November 2021

Unaudited

As at

30 November 2020

Unaudited

As at

31 May 2021

Unaudited

As at

31 May 2020

Unaudited

 

 

£'000

 

£'000

(restated)

£'000

(restated)

£'000

(restated)

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

Intangible assets arising on consolidation

 

1,050

1,216

1,129

1,289

Other intangible assets

 

16

49

32

65

Right-of-use assets

 

304

14

-

101

Property, plant and equipment

 

30

37

24

53

Investments held at Fair Value Through Other Comprehensive Income

 

3,568

3,751

3,604

4,962

Total non-current assets

 

4,968

5,067

4,789

6,470

 

 

 

 

 

 

Current assets

 

 

 

 

 

Trade and other receivables

 

2,797

3,325

2,211

2,340

Cash and cash equivalents

 

3,620

2,992

3,498

2,239

Total current assets

 

6,417

6,317

5,709

4,579

Current liabilities

 

 

 

 

 

Trade and other payables

 

2,647

3,237

2,049

2,924

Short-term lease liabilities

 

-

18

-

124

Current tax liabilities

 

43

-

43

-

Total current liabilities

 

2,690

3,255

2,092

3,048

Net current assets

 

3,727

3,062

3,617

1,531

 

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

Long-term lease liabilities

 

308

-

-

-

Deferred tax liabilities

 

735

538

573

611

Total non-current liabilities

 

1,043

538

573

611

Net assets

 

7,652

7,591

7,833

7,390

 

 

 

 

 

 

Equity

 

 

 

 

 

Share capital

 

2,957

2,939

2,939

2,923

Share premium

 

2,085

2,082

2,082

2,057

Revaluation reserve

 

2,356

2,736

2,553

3,597

Retained earnings

 

254

(166)

259

(1,187)

Shareholders' equity

 

7,652

7,591

7,833

7,390

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statement of Changes in Equity

 

 

 

Share Capital

Share Premium

Revaluation Reserve

Retained Earnings

Total Equity

 

£'000

£'000

£'000

£'000

£'000

Balance at 31 May 2021

2,939

2,082

2,553

562

8,136

Adjustments

-

-

-

(303)

(303)

Balance at 31 May 2021 as restated

2,939

2,082

2,553

259

7,833

Profit / (Loss) on ordinary activities after taxation

-

-

-

(6)

(6)

Movement in unrealised appreciation of investments

-

-

(35)

-

(35)

Deferred tax on movement in unrealised appreciation of investments

-

-

(162)

-

(162)

Total comprehensive income / (expense) for the period

-

-

(197)

(6)

(203)

Share based payment transactions

-

-

-

1

1

Issue of ordinary share capital

18

3

-

-

21

Total transactions with owners, recognised directly in equity

18

3

-

1

22

Balance at 30 November 2021

2,957

2,085

2,356

254

7,652

 

Balance at 31 May 2020

2,923

2,057

3,597

(1,129)

7,448

Adjustments

-

-

-

(58)

(58)

Balance at 31 May 2020 as restated

2,923

2,057

3,597

(1,187)

7,390

(Loss) on ordinary activities after taxation

-

-

-

(102)

(102)

Movement in unrealised appreciation of investments

-

-

222

-

222

Deferred tax on movement in unrealised appreciation of investments

-

-

(37)

-

(37)

Realised disposal of Fair value through other comprehensive income investments

-

-

(1,046)

1,122

76

Total comprehensive income / (expense) for the period

-

-

(861)

1,020

159

Share based payment transactions

-

-

-

1

1

Issue of ordinary share capital

16

25

-

-

41

Total transactions with owners, recognised directly in equity

16

25

-

1

42

Balance at 30 November 2020 as restated

2,939

2,082

2,736

(166)

7,591

 

Balance at 1 June 2020

2,923

2,057

3,597

(1,129)

7,448

Adjustments

-

-

-

(58)

(58)

Balance at 1 June 2020 as restated

2,923

2,057

3,597

(1,187)

7,390

Profit / Loss on ordinary activities after taxation

-

-

-

323

323

Movement in unrealised appreciation of investments

-

-

75

-

75

Deferred tax on movement in unrealised appreciation of investments

-

-

(12)

-

(12)

Realised disposal of Fair Value through OCI

-

-

(1,107)

1,122

15

Total comprehensive income / (expense) for the period

-

-

(1,044)

1,445

401

Share based payment transactions

-

-

-

1

1

Issue of ordinary share capital

16

25

-

-

41

Total transactions with owners, recognised directly in equity

16

25

-

1

42

Balance at 31 May 2021

2,939

2,082

2,553

259

7,833

 

 

Condensed Consolidated Statement of Cash Flows

For the six months ended 30 November 2021

 

 

 

Six months ended

30 November 2021

Unaudited

Six months ended

30 November 2020

Unaudited

Year ended

31 May 2021

Unaudited

 

£'000

 

£'000

(restated)

£'000

(restated)

Operating Profit / (loss)

(179)

(97)

138

Amortisation of intangible assets arising on consolidation

80

74

160

Amortisation of other intangible assets

16

16

33

Depreciation of Right-of-use assets

23

86

101

Depreciation of property, plant and equipment

15

16

33

Expenses settled by the issue of shares

1

1

2

Decrease/(increase) in receivables

(305)

(987)

125

Increase/(decrease) in payables

317

316

(873)

Cash generated from / (used in) operations

(32)

(575)

(281)

Tax paid

0

-

-

Net cash (used in)/generated from operating activities

(32)

(575)

(281)

Investing activities

 

 

 

Investment income received

183

-

237

Interest received

-

-

-

Proceeds on disposal of investments held at FVTOCI

-

1,400

1,400

Purchases of property, plant and equipment

(21)

-

(4)

Purchases of other intangible assets

-

-

-

Net cash (used in)/ generated from investing activities

162

1,400

1,633

Financing activities

 

 

 

Interest paid

(10)

(6)

(9)

Proceeds from issue of ordinary share capital

22

40

40

Repayment of lease liabilities

(20)

(106)

(124)

Net cash used in financing activities

(8)

(72)

(93)

Net (decrease) / increase in cash and cash equivalents

122

753

1,259

Cash and cash equivalents at beginning of period

3,498

2,239

2,239

Cash and cash equivalents at end of period/year

3,620

2,992

3,498

 

 

 

Notes to the Interim Financial Statements

1.  Basis of preparation

The Condensed Consolidated Interim Financial Statements of Fiske plc and its subsidiaries (the Group) for the six months ended 30 November 2021 have been prepared in accordance with IAS 34 (Interim Financial Reporting), as adopted in the United Kingdom. The accounting policies applied are consistent with those set out in the May 2021 Fiske plc Annual Report and accounts. These Condensed Consolidated Interim Financial Statements do not include all the information required for full annual statements and should be read in conjunction with the May 2021 Annual Report and Accounts.

The Financial Statements of the Group for the year ended 31 May 2021 were prepared in accordance with International Financial Reporting Standards adopted by in the United Kingdom. The statutory Consolidated Financial Statements for Fiske plc in respect of the year ended 31 May 2021 have been reported on by the Company's auditor and delivered to the registrar of companies. The report of the auditor was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under Section 498 (2) or (3) of the Companies Act 2006.

Under IAS 27 these financial statements are prepared on a consolidated basis where the Group consists of Fiske plc, the parent, and those subsidiaries in which it owns 100% of the voting rights, being Ionian Group Limited, Fiske Nominees Limited, Fieldings Investment Management Limited and VOR Financial Strategy Limited.

 

The directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Thus, they continue to adopt the going concern basis of accounting in preparing this half-yearly financial report.

There were no new mandatory standards or amendments to existing standards effective in the six-month reporting period to 30 November 2021.

 

2.  Revenues

IFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by management to allocate resources to the segments and to assess their performance. Following the acquisition of Fieldings Investment Management Limited in August 2017, their staff and operations have been integrated into the management team of Fiske plc. Pursuant to this, the Group continues to identify a single reportable segment, being UK-based financial intermediation. Within this single reportable segment, total revenue comprises:

 

 

Six months ended

30 November 2021

Unaudited

Six months ended

30 November 2020

Unaudited

Year ended

31 May 2021

Audited

 

£'000

£'000

(restated)

£'000

(restated)

Commission receivable

1,276

1,295

2,854

Investment management fees

1,578

1,353

2,920

 

2,854

2,648

5,774

Other income

2

51

80

 

2,856

2,699

5,854

 

 

3.  Deferred tax

Deferred tax assets and liabilities are recognised at a rate which is substantively enacted at the balance sheet date. The rate to be taken in this case is 25%, (2020: 19%) being the anticipated rate of taxation applicable to the Group and Company in the following year.

 

 

4.  Earnings per share

 

 

 

Basic

Diluted

Basic

 

£'000

£'000

Loss on ordinary activities after taxation

(6)

(6)

Adjustment to reflect impact of dilutive share options

-

-

Loss

(6)

(6)

Weighted average number of shares (000's)

11,785

11,785

Loss per share (pence)

(0.1)

(0.1)

 

 

5.  Impact of restatements

 

(a)  Consolidated Statement of Total Comprehensive income in the prior half year to 30 November 2020

 

Notes

As previously reported

(Unaudited)

£'000

Adjustments

(Unaudited)

£'000

As restated

(Unaudited)

£'000

Total Revenue

i

2,775

(76)

2,699

Operating expenses

 

(2,796)

-

(2,796)

Operating Profit/(loss)

 

(21)

(76)

(97)

Investment revenue

-

-

-

Finance income

-

-

-

Finance costs

(6)

-

(6)

(Loss) / Profit on ordinary activities before taxation

 

(27)

(76)

(103)

Taxation

 

(1)

-

(1)

(Loss)/Profit on ordinary activities after taxation

 

(26)

(76)

(102)

Other comprehensive income/(expense)

 

 

 

 

Movement in unrealised appreciation of investments

222

-

222

Deferred tax on movement in unrealised appreciation of investments

 

 

(37)

 

-

 

(37)

Net other comprehensive (expense)/ income

 

185

-

185

Total comprehensive (loss) / income for the period/year attributable to equity shareholders

 

 

159

 

(76)

 

83

(Loss) / Earnings per ordinary share (pence), excluding other comprehensive income

 

 

 

 

Basic

(0.2)p

(0.7)p

(0.9)p

Diluted

(0.2)p

(0.7)p

(0.9)p

 

(b)  Consolidated Statement of Total Comprehensive income in the prior year to 31 May 2021

 

Notes

As previously reported

(Audited)

£'000

Adjustments

(Unaudited)

£'000

As restated

(Unaudited)

£'000

Total Revenue

i

6,098

(244)

5,854

Operating expenses

 

(5,716)

-

(5,716)

Operating Profit/(loss)

 

382

(244)

138

Investment revenue

 

237

-

237

Finance income

 

-

-

-

Finance costs

 

(9)

-

(9)

(Loss) / Profit on ordinary activities before taxation

 

610

(244)

366

Taxation

 

(43)

-

(43)

(Loss)/Profit on ordinary activities after taxation

 

567

(244)

323

Other comprehensive income/(expense)

 

 

 

 

Movement in unrealised appreciation of investments

 

75

-

75

Deferred tax on movement in unrealised appreciation of investments

 

 

(12)

 

-

 

(12)

Net other comprehensive (expense)/ income

 

63

-

63

Total comprehensive (loss) / income for the period/year attributable to equity shareholders

 

 

630

 

(244)

 

386

(Loss) / Earnings per ordinary share (pence), excluding other comprehensive income

 

 

 

 

Basic

 

4.8p

(2.0)p

2.8p

Diluted

 

4.8p

(2.0)p

2.8p

 

 

(c)  Consolidated Statement of Financial Position as at 30 November 2020

 

Notes

As previously reported

(Unaudited)

£'000

Adjustments

(Unaudited)

£'000

As restated

(Unaudited)

£'000

 

 

 

 

 

Non-current assets

 

 

 

 

Intangible assets arising on consolidation

 

1,216

-

1,216

Other intangible assets

 

49

-

49

Right-of-use assets

 

14

-

14

Property, plant and equipment

 

37

-

37

Investments held at Fair Value Through Other Comprehensive Income

 

3,751

-

3,751

Total non-current assets

 

5,067

-

5,067

 

 

 

 

 

Current assets

 

 

 

 

Trade and other receivables

i

3,459

(134)

3,325

Cash and cash equivalents

 

2,992

-

2,992

Total current assets

 

6,451

(134)

6,317

Current liabilities

 

 

 

 

Trade and other payables

 

3,237

-

3,237

Short-term lease liabilities

 

18

-

18

Current tax liabilities

 

-

-

-

Total current liabilities

 

3,255

-

3,255

Net current assets

 

3,196

(134)

3,062

 

 

 

 

 

Non-current liabilities

 

 

 

 

Deferred tax liabilities

 

538

-

538

Total non-current liabilities

 

538

-

538

Net assets

 

7,725

(134)

7,591

 

 

 

 

 

Equity

 

 

 

 

Share capital

 

2,939

-

2,939

Share premium

 

2,082

-

2,082

Revaluation reserve

 

2,736

-

2,736

Retained earnings

 

(32)

(134)

(166)

Shareholders' equity

 

7,725

(134)

7,591

 

 

 

 

 

 

 

(d)  Consolidated Statement of Financial Position as at 31 May 2021

 

Notes

As previously reported

(Audited)

£'000

Adjustments

(Unaudited)

£'000

As restated

(Unaudited)

£'000

 

 

 

 

 

Non-current assets

 

 

 

Intangible assets arising on consolidation

1,129

-

1,129

Other intangible assets

32

-

32

Property, plant and equipment

24

-

24

Investments held at Fair Value Through Other Comprehensive Income

3,604

-

3,604

Total non-current assets

 

4,789

-

4,789

 

 

 

 

Current assets

 

 

 

Trade and other receivables

2,514

(303)

2,211

Cash and cash equivalents

 

3,498

-

3,498

Total current assets

 

6,012

(303)

5,709

Current liabilities

 

 

 

 

Trade and other payables

2,049

-

2,049

Current tax liabilities

43

-

43

Total current liabilities

 

2,092

-

2,092

Net current assets

 

3,920

(303)

3,617

 

 

 

 

 

Non-current liabilities

 

 

 

Deferred tax liabilities

 

573

-

573

Total non-current liabilities

 

573

-

573

Net assets

 

8,136

(303)

7,833

 

 

 

 

 

Equity

 

 

 

Share capital

2,939

-

2,939

Share premium

2,082

-

2,082

Revaluation reserve

2,553

-

2,553

Retained earnings

 

562

(303)

259

Shareholders' equity

 

8,136

(303)

7,833

 

 

 

 

 

 

 

(e)  Consolidated Statement of Financial Position as at 1 June 2020

 

Notes

As previously reported

(Audited)

£'000

Adjustments

(Unaudited)

£'000

As restated

(Unaudited)

£'000

 

 

 

 

 

Non-current assets

 

 

 

Intangible assets arising on consolidation

1,289

-

1,289

Other intangible assets

65

-

65

Right-of-use assets

101

-

101

Property, plant and equipment

53

-

53

Investments held at Fair Value Through Other Comprehensive Income

4,962

-

4,962

Total non-current assets

 

6,470

-

6,470

 

 

 

 

Current assets

 

 

 

Trade and other receivables

2,398

(58)

2,340

Cash and cash equivalents

 

2,239

-

2,239

Total current assets

 

4,637

(58)

4,579

Current liabilities

 

 

 

 

Trade and other payables

2,924

-

2,924

Short-term lease liabilities

124

-

124

Current tax liabilities

-

-

-

Total current liabilities

 

3,048

-

3,048

Net current assets

 

1,589

(58)

1,531

 

 

 

 

 

Non-current liabilities

 

 

 

Deferred tax liabilities

 

611

-

611

Total non-current liabilities

 

611

-

611

Net assets

 

7,448

(58)

7,390

 

 

 

 

 

Equity

 

 

 

Share capital

2,923

-

2,923

Share premium

2,057

-

2,057

Revaluation reserve

3,597

-

3,597

Retained earnings

 

(1,129)

(58)

(1,187)

Shareholders' equity

 

7,448

(58)

7,390

 

 

 

 

 

Notes:

i            impact of adjustments to the management fee accrual to reflect improved methodology of system data extraction

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