Interim Results, AGM Notice &

RNS Number : 2300O

Jarvis Securities plc

04 March 2009

 



4 March 2009 

Jarvis Securities plc

('Jarvis' or the 'Company')

Interim Results, AGM Notice and Prior Distributions

As set out in the announcement earlier today of the Company's results for the year ended 31 December 2008, amounts totalling £1,393,345 were paid to shareholders during 2008 as dividend payments. Due to a procedural issue, the interim distribution of 7p per Ordinary share paid on 25 July 2008 requires ratification by the Members at the Annual General Meeting. 

Details of this are included within the Notice of the Annual General Meeting distributed with the Annual Report to Members today. The Annual General Meeting will be held at the offices of the Company on Tuesday 14 April 2009 at 9.00 a.m. The resolutions to be considered are as follows:

The Ordinary Resolutions to be considered are:

1.	To approve the Directors' Report and Accounts for the year ended 31 December 2008.
2.	To re-appoint Messrs. Horwath Clark Whitehill LLP as auditors.
3.	To approve the appointment of Mr G McAusland as a director of the Company.
4.	To approve the appointment of Mr N J Crabb as a director of the Company
5.	To ratify the previously declared interim dividend of 7p per Ordinary share as paid on 25 July 2008.

The Special Resolution to be considered is:

6.	To renew the authority granted at the Extraordinary General Meeting of 30 July 2008 allowing the company to repurchase its own shares for Treasury or cancellation up to a maximum level of 10% of the Ordinary shares in issue at that date (being 10,800,000 Ordinary 1p shares).

In addition, the declared final dividend for the year ended 31 December 2007 of 6p per Ordinary share and paid on 14 March 2008 requires declaration as an interim dividend for 2009 in order to be treated as a lawful dividend. In order to declare this dividend, the Company is required to produce relevant accounts in accordance with the requirements of the Companies Act to justify such a payment. Consequently, unconsolidated interim results for the two months ended 28 February 2009 for Jarvis Securities plc as an entity only are set out below. The directors propose the payment of an interim dividend of 6.17p per Ordinary share (to take account of the reduction in issued share capital) to holders on the register at 6 March 2009 and to be treated as satisfied on the same date by release of the potential obligation to repay the distribution made to Members on 14 March 2008.

Subject to approval of resolution 5 at the Annual General Meeting, the net position of shareholders will not vary and this is not an additional payment in cash.

Enquiries: 

Jarvis Securities plc        Tel:   [phone] 

Andrew Grant

Mathew Edmett

Arbuthnot Securities      Tel: [phone]

Alasdair Younie

Katie Shelton

Notes: 

Jarvis Securities plc is the holding company for Jarvis Investment Management plc (AIM: JIM.L) a stock broking company and outsourced service provider for bespoke tailored financial administration. Jarvis was established in 1984 and is a member of the London Stock Exchange; a broker dealer member of PLUS Markets, authorised and regulated by the Financial Services Authority and an HM Revenue & Customs approved ISA manager. Jarvis has more than 30,000 retail clients and a growing number of institutional clients. As well as normal retail broking Jarvis provides cost effective and flexible share trading facilities within ISA and SIPP wrappers. 

Jarvis provides outsourced and partnered financial administration services to a number of third party organisations. These organisations include advisers, stockbrokers, banks and fund managers. Jarvis can tailor its administration processes to the requirements of each organisation and has a strong reputation for flexibility and cost-effectiveness.

JARVIS SECURITIES PLC

INTERIM FINANCIAL STATEMENTS

For the two month period ended 28 February 2009

CoMPANY income statement for the PERIOD ended 28 FEBRUARY 2009

	Notes 4 5 14		Two Months
			Ended
			28/2/09
			£
Continuing operations:
Revenue			1,548,340
Administrative expenses			(70,856)
Finance costs			(18)
Profit before income tax			1,477,466
Income tax charge			(75,600)
Profit for the period			1,401,866
Attributable to equity holders of the company			1,401,866

CoMPANY balance sheet as at 28 February 2009

	Notes			28/2/09
				£
Assets
Non-current assets
Property, plant and equipment	6			310,872
Intangible assets	7			40,962
Goodwill	7			342,872
Investments held to maturity	8			39,601
Available-for-sale investments	9			86,251
Investment in subsidiaries	10			112,118
Deferred income tax				3,143
				935,819
Current assets
Trade and other receivables	11			2,007,039
Cash and cash equivalents	12			22,889
				2,029,928
Total assets				2,965,747
Equity and liabilities
Capital and reserves	14
Share capital	13			105,000
Share premium	14			779,934
Capital redemption reserve	14			9,845
Revaluation reserve	14			85,152
Other reserves	14			56,819
Retained earnings	14			1,428,413
Own shares held in treasury	14			(83,319)
Total equity	14			2,381,844
Current liabilities	15
Trade and other payables	15			412,354
Income tax	15			171,549
Total liabilities	15			583,903
Total equity and liabilities				2,965,747

cashflow statement for the PERIOD ended 28 FEBRUARY 2009

			28/2/09
			£
Cash flow from operating activities
Profit before income tax			1,477,466
Depreciation and amortisation			25,417
Cost of share options			1,806
Finance costs			18
			1,504,707
(Increase) in trade and other receivables			(164,530)
(Decrease) in trade payables			(1,310,685)
Cash generated from operations			29,492
Interest paid			(18)
Net cash from operating activities			29,474
Cash flows from investing activities
Purchase of property, plant and equipment			(4,569)
			(4,569)
Cash flows from financing activities
Net cash used in financing activities			-
Net increase in cash and cash equivalents			24,905
Cash and cash equivalents at the start of the period			(2,016)
Cash and cash equivalents at the end of the period			22,889

Notes forming part of the INTERIM financial statements

1. Basis of preparation

The company has adopted the requirements of International Financial Reporting Standards (IFRS) and IFRIC interpretations endorsed by the European Union (EU) and those parts of the Companies Act 1985 applicable to companies reporting under IFRS. The interim financial statements have been prepared under the historical cost convention as modified by the revaluation of available-for-sale financial assets, and financial assets and liabilities at fair value through profit or loss.

These interim financial statements have been prepared in accordance with the accounting policies set out below, which have been consistently applied. These accounting policies comply with applicable IFRS standards and IFRIC interpretations issued and effective at the time of preparing these statements.

The following IFRS standards, amendments and interpretations are effective for the company from 1 January 2009. The adoption of these standards, amendments and interpretations does not have a material impact on the company's profit for the period or equity:

IFRIC 13 Customer Loyalty Programmes

IFRIC 16 Hedges of a Net Investment in a Foreign Operation

IAS1 Presentation of Financial Statements (revised September 2007)

IFRS 8 Operating Segments

IAS 32 Financial Instruments - Presentation (Amendments)

IAS1 Presentation of Financial Statements - Puttable Financial Instruments and Obligations Arising on Liquidation

Amendment to IFRS 2 Share Based Payment - Vesting Conditions and Cancellations

IAS 23 Borrowing Costs

IAS 27 Consolidated and Separate Financial Statements

IFRS 3 Business Combinations 

IFRIC 15 Agreements for the Construction of Real Estate

IAS 39 Financial Instruments: Recognition and Measurement (Amendment) - Eligible Hedged Items

Reclassification of Financial Assets (Amendments to IAS 39 Financial Instruments: Recognition and Measurement and IFRS 7 Financial Instruments: Disclosures)

IFRIC 17 Distributions of Non-cash Assets to Owners

IFRS 1 First- time Adoption of International Financial Reporting Standards (revised)

The preparation of financial statements in accordance with IFRS requires the use of certain accounting estimates. It also requires management to exercise judgement in the process of applying the Company's accounting policies. The areas involving a high degree of judgement or complexity, or areas where the assumptions and estimates are significant to the consolidated financial statements are detailed in note 18.

2. Summary of significant accounting policies

(a) Revenue

Revenue represents net sales of services excluding value added tax. 

(b) Property, plant and equipment

All property, plant and equipment is shown at cost less subsequent depreciation and impairment. Cost includes expenditure that is directly attributable to the acquisition of the items. Depreciation is provided on cost in equal annual instalments over the lives of the assets at the following rates:

Leasehold improvements - 33% on cost

Motor vehicles - 15% on cost

Office equipment -20% on cost

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date. Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the income statement. Impairment reviews of property, plant and equipment are undertaken if there are indications that the carrying values may not be recoverable or that the recoverable amounts may be less than the asset's carrying value.

(c) Intangible assets

Intangible assets are capitalised at their fair value on acquisition and carried at cost less accumulated amortisation. Amortisation is charged to administrative expenses within the income statement and provided on cost in equal annual instalments over the lives of the assets at the following rates:

Databases - 4% on cost

Software developments - 33% on cost

Website - 33% on cost

Impairment reviews of intangible assets are undertaken if there are indications that the carrying values may not be recoverable or that the recoverable amounts may be less than the asset's carrying value.

(d) Goodwill

Goodwill represents the excess of the fair value of the consideration given over the aggregate fair values of the net identifiable assets of the acquired trade and assets at the date of acquisition. Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses.

(e) Deferred income tax

Deferred income tax is provided in full, using the liability method, on differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. The deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction, other than a business combination, that at the time of the transaction affects neither accounting or taxable profit or loss. Deferred income tax is determined using tax rates that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Deferred income tax is provided on temporary differences arising on investments in subsidiaries except where the timing or the reversal of the timing difference is controlled by the company and it is probable that the temporary differences will not reverse in the foreseeable future.

(f) Segmental reporting

A business segment is a group of assets and operations engaged in providing products or services that are subject to risks and returns that are different from those of other business segments. The directors regard the operations of the company as a single segment.

(g) Operating leases and finance leases

Costs in respect of operating leases are charged on a straight line basis over the lease term in arriving at the profit before income tax. Where the company has entered into finance leases, the obligations to the lessor are shown as part of borrowings and the rights in the corresponding assets are treated in the same way as owned fixed assets. Leases are regarded as finance leases where their terms transfer to the lessee substantially all the benefits and burdens of ownership other than right to legal title.

(h) Finance lease interest

The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

(i) Investments

The company classifies its investments in the following categories: investments held to maturity, investments held for trading and available-for-sale investments. The classification depends on the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition and re-evaluates this designation at every reporting date.

Investments held to maturity

Investments held to maturity are stated at cost. An investment is classified in this category if acquired principally with the intention of holding indefinitely. Assets in this category are classified as non-current.

Investment held for trading

Investments held for trading are stated at fair value. An investment is classified in this category if acquired principally for the purpose of selling in the short term. Assets in this category are classified as current.

Available-for-sale investments

Available-for-sale investments are stated at fair value. They are included in non-current assets unless management intends to dispose of them within 12 months of the balance sheet date.

Purchases and sales of investments are recognised on the trade-date - the date on which the company commits to purchase or sell the asset. Investments are initially recognised at fair value. Investments are derecognised when the rights to receive cash flows from the investments have expired or been transferred and the company has transferred substantially all the risks and rewards of ownership. Realised and unrealised gains and losses arising from changes in fair value of investments held for trading are included in the income statement in the period in which they arise. Unrealised gains and losses arising in changes in the fair value of available-for-sale investments are recognised in equity. When investments classified as available-for-sale are sold or impaired, the accumulated fair value adjustments are included in the income statement as gains and losses from investment securities.

The fair value of quoted investments is based on current bid prices. If the market for an investment is not active, the company establishes fair value by using valuation techniques. These include the use of recent arm's length transactions, reference to other instruments that are substantially the same, or discounted cash flow analysis refined to reflect the issuer's specific circumstances.

The company assesses at each balance sheet date whether there is objective evidence that an investment is impaired. In the case of investments classified as available-for-sale, a significant or prolonged decline in the fair value below its cost is considered in determining whether the security is impaired.

(j) Share Capital

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction from proceeds, net of income tax.

Where the company purchases its equity share capital (treasury shares), the consideration paid, including any directly attributable incremental costs (net of income tax), is deducted from equity attributable to the company's equity holders until the shares are cancelled, reissued or disposed of. Where such shares are subsequently sold or reissued, any consideration received, net of any directly incremental transaction costs and the related income tax effects, is included in equity attributable to the company's equity holders.

(k) Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.

(l) Current income tax

Current income tax assets and/or liabilities comprise those obligations to, or claims from, fiscal authorities relating to the current or prior reporting periods, that are unpaid at the balance sheet date. They are calculated according to the tax rates and tax laws applicable to the fiscal periods to which they relate based on the taxable profit for the year. 

(m) Dividend distribution

Dividend distribution to the company's shareholders is recognised as a liability in the company's financial statements in the period in which interim dividends are notified to shareholders and final dividends are approved by the company's shareholders.

3. Segmental information

All of the reported revenue and operational results for the period derive from the company's continuing operations.

4. Profit before income tax		28/2/09
Profit before income tax is stated after charging:		£
Directors' emoluments		2,000
Depreciation - owned assets		22,414
Amortisation		3,003
Operating lease rentals - land and buildings		10,583
Finance costs		18
Directors' emoluments
Fees		2,000
Details of the highest paid director are as follows:
Aggregate emoluments		2,000

Key personnel

The executive directors are considered to be the key management personnel of the company.

5. Income and deferred tax charges							28/2/2009
							£
Based on the adjusted results for the period:
UK corporation tax							75,600
Total current income tax							75,600
6. Property, plant and equipment			Leasehold Improvements	Motor  Vehicle		Office  Equipment	Total
Cost:			£	£		£	£
At 1 January 2008			56,212	27,057		214,314	297,583
Additions			284,561	36,601		54,363	375,525
Disposal			(52,431)	-		(31,570)	(84,001)
At 31 December 2008			288,342	63,658		237,107	589,107
At 28 February 2009			288,342	63,658		237,107	589,107
Depreciation:
At 1 January 2008			41,191	7,912		161,133	210,236
Charge for the year			77,006	9,092		29,583	115,681
On disposal			(42,438)	-		(27,658)	(70,096)
At 31 December 2008			75,759	17,004		163,058	255,821
Charge for the year			16,018	1,591		4,805	22,414
At 28 February 2009			91,777	18,595		167,863	278,235
Net Book Value:
At 28 February 2009			196,565	45,063		69,244	310,872
At 31 December 2008			212,583	46,654		74,049	333,286

7. Intangible assets and goodwill		Goodwill	Databases	Software Development	Website		Total
		£	£	£	£		£
Cost:
At 1 January 2008		342,872	25,000	93,521	70,185		531,578
Additions		-	-	972	18,884		19,856
At 31 December 2008		342,872	25,000	94,493	89,069		551,434
Additions		-	-	1,569	3,000		4,569
At 28 February 2009		342,872	25,000	96,062	92,069		556,003
Amortisation:
At 1 January 2008		-	4,427	89,379	56,415		150,221
Charge for the year		-	1,250	2,834	14,861		18,945
At 31 December 2008		-	5,677	92,213	71,276		169,166
Charge for the year			208	281	2,514		3,003
At 28 February 2009		342,872	5,885	92,494	73,790		172,169
Net Book Value:
At 28 February 2009		342,872	19,115	3,568	18,279		383,834
At 31 December 2008		342,872	19,323	2,280	17,793		382,268

In reviewing the value of goodwill for impairment, the directors have assumed an attrition rate of 7.0% based upon the actual rate for the previous period and a discount rate of 2.0%. The discounted cashflow is calculated over a period of 5 years. For impairment to the goodwill value to occur, the attrition rate would need to exceed 86.7% or the discount rate would need to exceed 24.5%.

8. Investments held to maturity

28/2/2009

Unlisted Investments:

£

Cost:

At 1 January 2009

39,601

As at 28 February 2009

39,601

Unlisted investments held to maturity are stated at cost. Unlisted investments are interests held in the following company registered in the United Kingdom:

Shareholding

Holding

Business

Alexander David Securities Group plc

£39,601 at par

Loan notes

Stockbrokers

9. Available-for-sale investments

28/2/2009

Listed Investments:

£

Cost:

At 1 January 2009

57,500

On revaluation

28,751

As at 28 February 2009

86,251

Listed investments are stated at their market value at 28 February 2009. Listed investments are interests held in the following company registered in the United Kingdom:

Shareholding

Holding

Business

Alexander David Securities Group plc

2.7%

11,500,096

1p Ordinary shares

Stockbrokers

10. Investments in subsidiaries

28/2/2009

Unlisted Investments:

£

Cost:

At 1 January 2009

111,204

Additions (capital contributions re share option costs)

914

As at 28 February 2009

112,118

Shareholding

Holding

Business

Jarvis Investment Management plc

100%

10,030,000

1p Ordinary shares

Financial administration

Dudley Road Nominees Limited*

100%

2

£1 Ordinary shares

Dormant nominee company

JIM Nominees Limited*

100%

1

£1 Ordinary shares

Dormant nominee company

Galleon Nominees Limited*

100%

2

£1 Ordinary shares

Dormant nominee company

Sharegain Limited*

100%

1

£1 Ordinary shares

Dormant company

* indirectly held

11. Trade and other receivables							28/2/2009
Amounts falling due within one year:							£
Trade receivables							107,892
Amounts owed by group undertakings							322,436
Other receivables							22,887
Charge against ordinary shares							1,393,345
Prepayments and accrued income							160,479
							2,007,039
12. Cash and cash equivalents							28/2/2009
							£
Balance at bank and in hand							22,889
							22,889
13. Share capital							28/2/2009
							£
Authorised:
16,000,000 Ordinary shares of 1p each							160,000
Allotted, issued and fully paid:
10,500,000 (2007: 10,800,000) Ordinary shares of 1p each							105,000

A total of 600,000 options were granted to directors and employees on admission of the company to trading on AIM on 23 December 2004 and a further 50,000 to a director on 20 January 2007. These options were granted with an exercise price of 82.5p and are first exercisable on 23 December 2009 and with a last exercise date of 23 December 2014. In addition, 230,000 options were granted on 18 May 2007 to directors and employees with an exercise price of 175p and are first exercisable on 17 May 2012 and with a last exercise date of 17 May 2017. The total number of options currently unexercised and in issue is 820,000.

The following options were granted to directors and remain in issue:

	at 82.5p		at 175p
A J Grant	273,500		76,500
M J Edmett	175,000		50,000

14. Capital and reserves

	Share capital	Share premium	Capital redemption reserve	Revaluation reserve	Other reserves	Retained earnings	Own shares held in treasury	Total equity
	£	£	£	£	£	£	£	£
At 1 January 2008	108,000	779,934	6,845	-	34,010	100,890	(1,930)	1,027,749
Profit for the financial year	-	-	-	-	-	675,285	-	675,285
Expense of employee options	-	-	-	-	20,089	-	-	20,089
Deferred tax charged to equity	-	-	-	-	-	(29,305)	-	(29,305)
Purchase of own shares	-	-	-	-	-	-	(842,962)	(842,962)
Cancellation of own shares	(3,000)	-	3,000	-	-	(720,323)	720,323	-
Sale of shares from treasury	-	-	-	-	-	-	41,250	41,250
Investment revaluation	-	-	-	56,401	-	-	-	56,401
At 31 December 2008	105,000	779,934	9,845	56,401	54,099	26,547	(83,319)	948,507
Profit for the period	-	-	-	-	-	1,401,866	-	1,401,866
Expense of employee options	-	-	-	-	2,720	-	-	2,720
Investment revaluation	-	-	-	28,751	-	-	-	28,751
At 28 February 2009	105,000	779,934	9,845	85,152	56,819	1,428,413	(83,319)	2,381,844

Other reserves relates to the provision for the estimated cost of employee share options. 

15. Trade and other payables			28/2/2009
Amounts falling due within one year:			£
Trade payables			26,795
Other provisions			385,559
Trade and other payables			412,354
Income tax			171,549
Total liabilities			583,903

16. Operating lease commitments

At 28 February 2009 the company was committed to making the following payments in respect of operating leases which expire:

			28/2/2009
Land & buildings:			£
After more than five years:			608,542

On 26 September 2007 the company entered into a lease with Sion Holdings Limited, its parent company, for the rental of 78 Mount Ephraim, a self-contained office building. The lease has an annual rental of £63,500, being the market rate on an arm's length basis, and expires on 26 September 2017.

17. Financial Instruments

The company's principal financial instruments comprise cash, short terms borrowings and various items such as trade receivables, trade payables etc. that arise directly from operations. The main purpose of these financial instruments is the funding of the company's trading activities.

The main financial asset of the company is cash and cash equivalents which is denominated in sterling and which is detailed in note 12. The company also holds investments in equities and loan notes.  

Short-term receivables and payables are excluded from these disclosures.

18. Critical accounting estimates and judgements

The company makes estimates and assumptions concerning the future. These estimates and judgements are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets within the next financial year relate to goodwill and the expense of employee options.

The company tests annually whether goodwill has suffered any impairment, in accordance with the accounting policy stated in Note 2 (d). These calculations require the use of estimates. The assumptions and sensitivity relating to the impairment tests are detailed in note 7.

Employee options are expensed equally in each year from issue to the date of first exercise. The total cost is calculated on issue based on the Black Scholes method with a volatility rate of 30% and a risk free interest rate of 3.75%. It is assumed that all current employees with options will still qualify for the options at the exercise date.

19. Immediate and ultimate parent undertaking

The company's immediate and ultimate parent undertaking is Sion Holdings Limited, a company registered in England and Wales. The largest set of accounts that Jarvis Securities plc is consolidated into is that of Sion Holdings Limited. Sion Holdings Limited is controlled by Mr A J Grant by virtue of his majority shareholding.

20. Related party transactions

Jarvis Investment Management plc paid a performance related management charge to Jarvis Securities plc of £250,000 during the period. Other receivables for the company include £5,000 due from Mr M J Edmett, a director of the company.

21. Event after the balance sheet date

Amounts totalling £1,393,345 were paid to shareholders during 2008 as dividend payments. Due to a procedural issue, these distributions require ratification by the Members at the Annual General Meeting as an interim dividend for 2009 in order to be treated as a lawful dividend. Consequently the Board proposes the payment of an interim dividend as detailed in the recent Notice of Meeting sent to Members.

22. Capital commitments

The company had no capital commitments at 28 February 2009.

23. Fair value estimation

The fair value of financial instruments traded in active markets (such as trading and available for sale securities) is based on quoted market prices at the balance sheet date. The quoted market price used for financial assets held by the company is the current bid price.

The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values. 

24. Financial risk management objectives and policies

The directors consider that their main risk management objective is to monitor and mitigate the key risks to the company, which are considered to be principally credit risk and liquidity risk. Several high-level procedures are already in place to enable all risks to be better controlled. These include detailed profit forecasts by business segment, monthly management accounts and comparisons against forecast, and regular meetings of the full Board of Directors.

The company's main credit risk is in respect of trade receivables. The company's policy is to monitor trade and other receivables and avoid significant concentrations of credit risk. Aged receivables reports are reviewed regularly and significant items brought to the attention of senior management. 

The company aims to fund its expansion plans mainly from existing cash balances without making use of bank loans or overdraft facilities. Other risks are under constant review by the executive directors.

The directors do not consider that the company is materially exposed to foreign exchange risk or interest rate risk.

 

END

 

 

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