TIDMANX
RNS Number : 5042V
Anexo Group PLC
09 April 2019
For immediate release 9 April 2019
Anexo Group plc
('Anexo' or the 'Group')
Final Results
'Strategic IPO objectives met; sustained profitable growth and
maiden dividend proposed'
Anexo Group plc (AIM: ANX), the specialist integrated credit
hire and legal services provider, announces its maiden set of final
results for the year ended 31 December 2018 (the 'period' or 'FY
2018').
Financial Highlights
-- Successfully raised GBP25.0 million(1) (before expenses)
and admitted to trading on AIM in June 2018
-- Revenue increased by 24.7% to GBP56.5 million (FY 2017: GBP45.3
million)
-- Operating profit reported at GBP15.4 million (2017: GBP15.1
million), an increase of 2.7%
-- Adjusted(2) operating profit before exceptional items slightly
ahead of market expectations, rising by 13.9% to GBP17.2
million (FY 2017: GBP15.1 million)
-- Adjusted(2) operating profit margin reduced marginally to
30.4% (FY 2017: 33.3%)
-- Profit before tax of GBP14.3 million (2017: GBP14.6 million),
a reduction of 2.0%
-- Adjusted(2) profit before tax and exceptional items increased
to GBP16.1 million, (2017: GBP14.6 million), an increase
of 10.3%
-- Adjusted(3) basic EPS at 12 pence (FY 2017: 11.4 pence)
-- Proposed final dividend of 1.5 pence per share (FY 2017:
Nil)
-- Net assets reported at GBP75.8 million (FY 2017: GBP55.6
million) representing an increase of 36.3%
-- Net cash outflow from operating activities to fund growth
of GBP7.9 million (FY 2017: net cash inflow: GBP1.1 million)
-- Strong net cash balance of GBP5.5 million at 31 December
2018 (31 December 2017: GBP0.2 million)
-- Net debt balance at 31 December 2018 was GBP17.3 million
(31 December 2017: GBP15.0 million)
1. The placing that accompanied Anexo's admission to AIM raised
GBP25.0 million before expenses, of which GBP10.0 million was
raised for the Group, and GBP15.0 million for the Selling
Shareholders, of which not less than GBP5.0 million was repaid to
the Group.
2. Adjusted operating profit and profit before tax: excludes the
costs of Admission to AIM and share--based payment charges.
3. Adjusted EPS: adjusted PBT less tax at statutory rate divided
by the number of shares on a pro forma basis, i.e. assuming that
the number of shares in issue immediately post-IPO were in issue
through the entire comparative period.
Operational Highlights and KPIs
-- Bolton office opened on 3 December 2018. At 31 December
2018 it had recruited 20 experienced litigators significantly
increasing capacity within Bond Turner
-- Focus on settlement rate which continues to move upwards
driving increased cash collections
-- Number of new cases funded increased 31.2% to 5,930 (FY
2017: 4,520)
KPI FY 2018 FY 2017 % movement
Number of vehicles on hire at
the year end 1,531 815 +87.9
Average number of vehicles on
hire for the year 1,155 894 +29.2
Cash collections from settled
cases (GBP'000s) 58,100 53,973 +7.6
New cases funded (no) 5,930 4,520 +31.2%
Number of senior fee earners
at period end 89 66 +34.8
Average number of senior fee
earners 76 62 +22.6
Commenting on the Final Results, Alan Sellers, Executive
Chairman of Anexo Group plc, said:
"We are delighted to report such a strong set of maiden final
results which, as announced earlier in January 2019, are ahead of
market expectations. Anexo has successfully demonstrated that the
cash raised at IPO has enabled the strategic investment outlined
upon Admission, expanding the Credit Hire fleet and growing Anexo's
high quality legal team in order to increase the number of
processed claims whilst increasing cash generation from cases
settled.
"The investment is clearly supporting near-term profitable
growth across the business with the strong financial performance,
coupled with the ever-increasing UK credit hire and legal claims
market, giving the Board confidence in our ability to scale and
generate near term returns for our shareholders as demonstrated by
the maiden proposed final dividend in line with the Board's stated
intention at Admission.
Anexo remains extremely well positioned to grow its market share
and take advantage of the opportunities available to it. The Board
views the current financial year with considerable optimism."
- Ends -
For further enquiries:
Anexo Group plc +44 (0) 151 227 3008
www.anexo-group.com
Alan Sellers, Executive Chairman
Mark Bringloe, Chief Financial Officer
Arden Partners plc
(Nominated Adviser and Broker)
John Llewellyn-Lloyd / Benjamin Cryer +44 (0) 20 7614 5900
/ Alex Penney www.arden-partners.co.uk
Buchanan
(Financial Communications)
Henry Harrison-Topham / Steph Watson +44 (0) 20 7466 5000
Anexo@buchanan.uk.com
Notes to Editors:
Anexo is a specialist integrated credit hire and legal services
provider. The Group has created a unique business model by
combining a direct capture Credit Hire business with a wholly owned
Legal Services firm. The integrated business targets the
impecunious not at fault motorist, referring to those who do not
have the financial means or access to a replacement vehicle.
Through its dedicated Credit Hire sales team and network of
1,100 plus active referrers around the UK, Anexo provides customers
with an end-to-end service including the provision of Credit Hire
vehicles, assistance with repair and recovery, and claims
management services. The Group's Legal Services division, Bond
Turner, provides the legal support to maximise the recovery of
costs through settlement or court action as well as the processing
of any associated personal injury claim.
The Group was admitted to trading on AIM in June 2018 with the
ticker ANX. For additional information please visit:
www.anexo-group.com.
Executive Chairman's Statement
On behalf of the Board, I am pleased to introduce Anexo's maiden
set of full year results since the Group's admission to trading on
AIM in June 2018, which has enabled us to accelerate our growth and
enhance market share. The Group has performed strongly in the
financial year ended 31 December 2018, with significant growth
compared to FY 2017 and Anexo has excellent prospects for FY 2019
and beyond.
Group performance
We delivered a strong performance across the Group in our first
financial year on AIM and it was pleasing to see revenues growing
across the operational businesses. Group revenues increased from
GBP45.3 million in FY 2017 to GBP56.5 million in FY 2018,
generating growth of 24.7% year on year, a result which was ahead
of market expectations.
Credit Hire division
Anexo has deployed an element of the funds raised at IPO to
expand the fleet, reaching 1,946 vehicles available for hire at
period end (FY 2017: 1,066), an 82.6% increase on the prior year
with a similar trend seen in the number of vehicles on hire to
clients which increased from 815 to 1,531 during FY 2018 (an
increase of 87.9%).
In particular, the Group has witnessed growth in our motorcycle
business, facilitated by the strategic investment in the fleet.
The high utilisation rates of these vehicles and bikes on the
road (which is typically in the region of 75% to 80%) demonstrates
the strong demand for Anexo's credit hire services across the UK
and the quality of the Group's sales staff which are supporting the
expansion of our market share. These trends are even more pleasing
given we have only had access to the IPO funding for part of the
year.
Furthermore, as outlined at the time of the IPO, the increased
access to financial resources is accelerating Anexo's growth
strategy as we are able to employ additional local sales
representatives, who are proven to generate higher revenues with
increased efficiency when working closer to home, whilst broadening
Anexo's geographic footprint in the UK.
Legal Services division
A significant portion of the IPO funds were targeted at
increasing capacity within Bond Turner, our legal services
business. This was to facilitate the scaling of the Credit Hire
business whilst improving cash generation. The expanded capacity at
Bond Turner has been supported by the opening of our new office in
Bolton in December 2018, where recruitment has progressed well and
the number of highly skilled, vastly experienced litigators
continues to grow. In fact, we have managed to increase the number
of senior fee earners within the Group from 66 at the end of FY
2017 to 89 at 31st December 2018, an increase of almost 35% during
the year in line with our recruitment policy.
With further significant investment planned into FY 2019, these
additional staff are expected to provide a significant increase to
the number of cases settled during FY 2019 and ultimately the level
of cash recovered from our significant portfolio of cases.
With the support of our larger legal team, it is pleasing to see
that Anexo has been able to increase the number of new cases funded
by 31.2% between FY 2017 and FY 2018, having completed just over
5,200 credit hire claims during FY 2018.
As a result of the factors set out above, I am pleased to be
able to report to shareholders that the Group achieved an adjusted
profit before taxation of GBP16.1 million compared to GBP14.6
million last year, an increase of 10.3%, further details around the
Group's performance are included within the Financial Review.
Dividends
The Board is pleased to propose a final dividend of 1.5 pence
per share, which if approved at the Annual General Meeting to be
held on 12 June 2019 will be paid on 28 June 2019 to those
shareholders on the register at the close of business on 21 June
2019. The shares will become ex-dividend on 20 June 2019. No
interim dividend was paid or proposed by Anexo Group Plc.
Corporate Governance
Anexo values corporate governance highly and the Board believes
that effective corporate governance is integral to the delivery of
the Group's corporate strategy, the generation of shareholder value
and the safeguard of our shareholders' long-term interests.
As Chairman, I am responsible for the leadership of the Board
and for ensuring its effectiveness in all aspects of its role. The
Board is responsible for the Group's strategic development,
monitoring and achievement of its business objectives, oversight of
risk and maintaining a system of effective corporate governance. I
will continue to draw upon my experience to help ensure that the
Board delivers maximum shareholder value.
Our employees and stakeholders
The strong performance of the Group reflects the dedication and
quality of the Group's employees. We rely on the skills, experience
and commitment of our team to drive the business forward. Their
enthusiasm, innovation and performance remain key assets of the
Group and are vital to its future success. On behalf of the Board,
I would like to thank all of our employees, customers, suppliers,
business partners and shareholders for their continued support over
the last year.
Outlook
The outlook for FY 2019 is positive and we remain confident that
management decisions and investment will result in increasing
claims generation and an expanding market share for our Credit Hire
division.
As we continue to expand the Legal Services division, we expect
revenues to increase. Recruitment has continued to progress well in
Anexo's new Bolton office and we are close to finalising the terms
of contracts with a number of high quality litigators. The
additional capacity is driving our settlement numbers and rates and
we believe this will significantly improve cash generation in FY
2019 by fully leveraging the potential in our case book and realise
its potential as a significant cash generating asset. Having only
opened the office in early December 2018, we had successfully
recruited 20 legal staff into Bolton by the year end.
Trading in the year to date has been in line with the Board's
expectations. We are in final negotiations with yet more high
quality litigators who wish to join our growing Bond Turner
practice in Bolton, which is helping us to increase the number of
claims processed by the Group.
Anexo remains extremely well positioned to grow its market share
and take advantage of the opportunities available to it. The Board
views the current financial year with considerable optimism.
Alan Sellers
Executive Chairman
9 April 2019
Financial Review
Basis of Preparation
Anexo Group Plc was admitted to AIM on 20 June 2018 (the 'IPO').
Given the Company was formed on 27 March 2018 and acquired its
subsidiaries on 15 June 2018, these are the first consolidated
statutory financial statements. In order to provide an
understanding of the trading performance of the Group, comparative
numbers have been presented on a basis consistent with the Group
being in existence through FY 2018 and FY 2017.
In addition, to provide comparability across reporting periods,
the results within this Financial Review are presented on an
'underlying' basis, adjusting for the GBP1.4 million cost of this
year's IPO transaction and the GBP0.4 million charge recorded for
share-based payments.
A reconciliation between underlying and reported results is
provided at the end of this Financial Review. This Financial Review
also incorporates and constitutes the Strategic Report of the
Group.
Revenue
In FY 2018 Anexo successfully increased revenues across both of
its divisions, Credit Hire and Legal Services, resulting in Group
revenues of GBP56.5 million, representing a 24.7% increase over the
prior year (FY 2017: GBP45.3 million).
During FY 2018 we provided vehicles to 5,215 individuals (FY
2017: 4,586) an increase of 13.7%. Much of this growth has arisen
within the motorcycle side of our business and of the increase in
claims (629 - 13.7%) between FY 2017 and FY 2018. The number of
motorcycle claims increased from 2,260 in FY 2017 to 2,923 in FY
2018, an increase of 663 (29.3%). This growth follows the strategic
decision to expand the McAMS division alongside our continued
investment into the motorcycle community, with the sponsorship of
the McAMS Yamaha team in the British Superbike Championship
continuing into FY 2019.
Growth has also been reported within the Legal Services
division, revenues rising from GBP20.5 million in FY 2017 to
GBP22.5 million in FY 2018 (an increase of 9.8%).
Expansion of the headcount in Bond Turner is critical to
increasing both revenues and cash settlements into the Group and
the opening of the Bolton Office in December 2018 provides a
crucial platform for growth in both factors. By the end of December
2018, we had recruited 20 staff into the Bolton Office, of which 17
are senior fee earners, taking the total number of staff employed
in Bond Turner to 267 (FY 2017: 187), of which 89 are senior fee
earners (FY 2017: 66). This investment has resulted in an increase
in senior fee earners of 23 (34.8%) significantly adding to our
settlement and cash recovery capacity.
Gross Profits
Gross profits were reported at GBP40.3 million (at a margin of
71.4%) in FY 2018, increasing from GBP34.0 million in FY 2017 (at a
margin of 74.9%). Whilst the reported results indicate a reduction
in margin, staffing costs within Bond Turner are reported within
Administrative Expenses, gross profit in effect being reported at
100% within Bond Turner. This reduction reflects the change in the
mix of Credit Hire to total revenues which increased between FY
2017 (54.8%) and FY 2018 (60.2%).
Gross profits for the Credit Hire division reached GBP19.9
million in FY 2018 (at a margin of 58.5%) rising from GBP14.9
million in FY 2017 (at a margin of 60.2%), the slight reduction
reflecting an increase in vehicle insurance premiums year on
year.
Operating Costs
Administrative expenses before exceptional items increased
year-on-year, reaching GBP21.6 million in FY 2018 (FY 2017: GBP18.1
million) an increase of GBP3.5 million (19.3%) reflecting the
continued investment in staffing costs within Bond Turner to drive
settlement of cases and cash collections; staffing costs increased
to GBP8.7 million (FY 2017: GBP6.2 million) an increase of GBP2.5
million, the balance of the increase reflecting investment in staff
and infrastructure to allow the Group to meet its growth
aspirations, as well as to meet its requirements as a PLC.
During FY 2018 we continued to invest heavily in our motorcycle
fleet, a significant element of which is capitalised and
depreciated, whereas a lesser element is sourced under operating
lease arrangements (as are all of the car fleet) and charged to the
profit and loss accounts as incurred. Total capex on vehicles
reached GBP2.9 million in FY 2018 (FY 2017: GBP1.3 million)
resulting in an increased depreciation charge in the year of GBP1.6
million (FY 2017: GBP0.8 million).
EBITDA
Adjusted EBITDA reached GBP18.7 million in FY 2018, increasing
from GBP15.8 million in FY 2017 (18.4%), the result, as previously
announced was ahead of management expectations. To provide a better
guide to the underlying business performance, adjusted EBITDA
excludes share-based payment charges, professional and other costs
charged to the profit and loss account in relation to the listing
along with depreciation, interest and tax from the measure of
profit.
The GAAP measure of the profit before interest and tax was
GBP15.4 million (FY 2017: GBP15.1 million) reflecting the non-cash
share-based payment charge of GBP0.4 million (FY 2017: GBPNil) as
well as the professional and other fees arising from the listing
(GBP1.4 million). Where we have provided adjusted figures, they are
after add-back of these two items.
EPS and Dividend
Statutory basic EPS is 10.4 pence (FY 2017: 11.4 pence).
Statutory diluted EPS is 10.2 pence (FY 2017: 11.1 pence). The
adjusted EPS is 12.0 pence (FY 2017: 11.4 pence). The adjusted
diluted EPS is 11.8 pence (FY 2017: 11.1 pence). The adjusted
figures exclude the effect of share based payments and the fees
associated with the listing.
Following our first period end trading as an AIM quoted group a
final dividend of 1.5 pence per share has been recommended by the
Board (FY 2017: Nil). No interim dividend was either paid or
proposed by Anexo Group Plc since incorporation. This dividend, if
approved at the Annual General Meeting to be held on 12 June 2019,
will be paid on 28 June 2019 to those shareholders on the Register
at the close of business on 21 June 2019.
Group Statement of Financial Position
The Group's net assets position is dominated by the balances
held within trade and other receivables. This balance includes
credit hire and credit repair debtors and disbursements paid in
advance and support of ongoing claims. The value of the receivables
being GBP165.2 million in FY 2018, rising from GBP151.5 million in
FY 2017. In accordance with our income recognition policies,
provision is made to reduce the carrying value to recoverable
amounts, being GBP76.0 million and GBP55.9 million respectively, an
increase of 36.0%. This increase reflects the recent trading
activity and strategy of the Group and is in line with management
expectation.
In addition, the Group has a total of GBP23.0 million reported
as accrued income (FY 2017: GBP16.3 million) which represents the
value attributed to those ongoing hires and claims.
Further investment has been made into the motorcycle fleet in FY
2018 to keep up with demand, with total fixed asset additions
totalling GBP3.5 million in FY 2018 (FY 2017: GBP1.5 million), the
fleet being in part financed with hire purchase, the balance
outstanding increasing during FY 2018 to GBP2.5 million (FY 2017:
GBP1.3 million).
Trade and other payables, including tax and social security
increased to GBP7.2 million compared to GBP5.4 million at 31st
December 2017, an increase of 33.3%.
Net assets at 31st December 2018 reached GBP75.8 million (FY
2017: GBP55.6 million).
Cash Flow
Following the AIM listing, the Group utilised the funds raised,
alongside increases in debt facilities, to take advantage of the
opportunities in the market and increase the number of vehicles on
the road alongside a significant investment in the capacity of the
legal services business, where the number of senior staff engaged
to settle cases and recover cash for the group increased from 66 to
89 during FY 2018 (an increase of 34.8%). Whilst this strategy
improves profitability and absorbs working capital in the short
term, it is anticipated that the real financial benefits to the
Group will come through in FY 2019.
Fleet investment was most significant on the McAMS side of the
Credit Hire division, where the number of vehicles on the road
increased from 563 at the start of the period to 1,011 at 31
December 2018, an increase of 80%. The number of cars and vans in
this division also saw significant growth, with vehicles on the
road increasing from 252 to 520 during FY 2018 (an increase of
106.0%), demonstrating the significant opportunities available to
the Group as a whole.
In FY 2018 the Group reported a net cash outflow from operating
activities of GBP7.9 million (FY 2017: Cash inflow GBP1.1 million).
The total variance between the profits reported in FY 2018 of
GBP11.4 million (FY 2017: GBP12.5 million) and the net cash flow
from operating activities reached GBP19.3 million (FY 2017: GBP11.3
million) and included the investment made into new cases across
both the Credit Hire and Legal Services divisions, absorbing a net
GBP20.5 million of funds in FY 2018 (FY 2017: GBP12.4 million).
During the year total cash receipts increased to GBP58.1 million
(FY 2017: GBP54.0 million) an increase of 7.6% year on year.
Investment in the motorcycle fleet continued into FY 2018,
accounting for the majority of the GBP3.5 million of fixed asset
additions (FY 2017: GBP1.5 million), funded from cash flow and the
draw of an additional GBP2.6 million of hire purchase funding (FY
2017: GBP1.2 million).
As previously reported, the Group generated a net GBP9.3 million
from the AIM listing, alongside additional debt funding of GBP4.0
million (FY 2017: GBP6.8 million). As a result of the above, the
Group reported a net increase in cash and cash equivalents of
GBP0.5 million in 2018 (FY 2017: GBP2.5 million).
Net Debt, Cash and Financing
Cash balances increased during FY 2018 and at 31 December 2018
reached GBP5.5 million (FY 2017: GBP0.2 million), this increase
reflects additional funding facilities secured and drawn during FY
2018, net debt reported at GBP17.3 million at 31 December 2018 (FY
2017: GBP15.0 million).
Borrowings increased during the year to fund the additional
working capital investment in the Group's portfolio of claims, the
balance rising from GBP15.2 million in FY 2017 to GBP22.8 million
at the end of FY 2018. The two principal facilities include an
invoice discounting facility within Direct Accident Management
Limited, (and secured on the credit hire and repair receivables)
and a revolving credit facility within Bond Turner Limited.
The Group is in advanced discussions with a specialist legal
assets funder to extend and increase existing facilities and secure
additional funding from the Group's current asset base to support
growth across all aspects of the business operations. This extended
the current facilities which expire in November 2019. This funding
is intended to support the Group's working capital as it continues
to expand its legal capacity and increase the rate of cash
conversion.
Reconciliation of Underlying and Reported IFRS Results
In establishing the underlying operating profit, the costs
adjusted include GBP1.4 million (FY 2017: GBPNil) related to the
cost of the Company's Admission to AIM that was completed in June
2018 (the 'IPO costs') and GBP0.4 million of costs related to
share-based payments (FY 2017: GBPNil).
A reconciliation between underlying and reported results is
provided below:
Year to
December
Year to December 2018 2017
-----------------------
Share-based Reported
Underling IPO Costs payment Reported and underlying
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
----------------------- ------------ ------------ ------------ ----------- ----------------
Revenue 56,505 - - 56,505 45,302
Gross profit 40,337 - - 40,337 33.953
Other operating costs
(net) (23,168) (1,411) (384) (24,963) (18,879)
Operating profit 17,169 (1,411) (384) 15,374 15,074
Finance costs (net) (1,090) - - (1,090) (492)
Profit before tax 16,079 (1,411) (384) 14,284 14,582
Depreciation 1,574 - - 1,574 760
EBITDA 18,743 (1,411) (384) 16,948 15,834
----------------------- ------------ ------------ ------------ ----------- ----------------
By order of the Board.
Mark Bringloe
Chief Financial Officer
9 April 2019
Consolidated Statement of Total Comprehensive Income
for year ended 31 December 2018
2018 2017
Note GBP'000s GBP'000s
Revenue 56,505 45,302
Cost of sales (16,168) (11,349)
--------- -----------
Gross profit 40,337 33,953
Depreciation & loss on disposal (1,574) (760)
Administrative expenses before exceptional
items (21,594) (18,119)
Operating profit before exceptional
items 17,169 15,074
--------- -----------
Share based payment charge 3 (384) -
Non-recurring administrative expenses 3 (1,411) -
Operating profit 3 15,374 15,074
--------- -----------
Finance income - -
Finance costs (1,090) (492)
Net financing expense (1,090) (492)
--------- -----------
Profit before tax 14,284 14,582
Taxation (2,879) (2,095)
Profit and total comprehensive income
for the year attributable to the owners
of the company 11,405 12,487
--------- -----------
Earnings per share
Basic earnings per share (pence) 4 10.4 11.4
--------- -----------
Diluted earnings per share (pence) 4 10.2 11.1
--------- -----------
The above results were derived from continuing operations.
Consolidated Statement of Financial Position
as at 31 December 2018
2018 2017
Assets Note GBP'000s GBP'000s
Non-current assets
Property, plant and equipment 5 3,270 1,520
3,270 1,520
--------- -------------
Current assets
Trade and other receivables 6 101,445 80,593
Cash and cash equivalents 5,532 202
106,977 80,795
--------- -------------
Total assets 110,247 82,315
--------- -------------
Equity and liabilities
Equity
Share capital 55 50
Share premium 9,235 40
Share based payments reserve 384 -
Retained earnings 66,127 55,542
--------- -------------
Equity attributable to the owners
of the Company 75,801 55,632
--------- -------------
Non-current liabilities
Other interest-bearing loans and borrowings 7 870 5,475
Deferred tax liabilities - -
870 5,475
--------- -------------
Current liabilities
Bank overdraft 7 12,536 7,688
Other interest-bearing loans and borrowings 7 9,402 2,085
Trade and other payables 7,223 5,395
Corporation tax liability 4,415 6,040
33,576 21,208
--------- -------------
Total liabilities 34,446 26,683
--------- -------------
Total equity and liabilities 110,247 82,315
--------- -------------
Consolidated Statement of Changes in Equity
for the year ended 31 December 2018
Share Based
Share Share Payment Retained
Capital Premium Reserve Earnings Total
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
At 1 January 2017 50 40 - 46,756 46,846
Profit for the year
and total comprehensive
income - - - 12,487 12,487
Dividends - - - (3,701) (3,701)
At 31 December 2017 50 40 - 55,542 55,632
Profit for the year
and total comprehensive
income - - - 11,405 11,405
Issue of share capital 5 - - - 5
Increase in share premium - 9,195 - - 9,195
Creation of share based
payment reserve - - 384 - 384
Dividends - - - (820) (820)
At 31 December 2018 55 9,235 384 66,127 75,801
--------- ---------- ------------ ---------- ---------
Consolidated Statement of Cash Flows
for the year ended 31 December 2018
2018 2017
GBP'000s GBP'000s
Cash flows from operating activities
Profit for the year 11,405 12,487
Adjustments for:
Depreciation and loss on disposal 1,574 730
Financial expense 1,090 492
Taxation 2,879 2,095
--------- ---------
16,948 15,804
Working capital adjustments
(Increase)/decrease in trade and other
receivables (20,871) (12,360)
(Decrease)/increase in trade and other
payables 1,828 (329)
--------- ---------
Cash generated from operations (2,095) 3,115
Interest paid (1,090) (492)
Tax paid (4,738) (1,475)
--------- ---------
Net cash from operating activities (7,923) 1,148
--------- ---------
Cash flows from investing activities
Proceeds from sale of property, plant
and equipment 170 183
Acquisition of property, plant and
equipment (3,493) (1,473)
Net cash from investing activities (3,323) (1,290)
--------- ---------
Cash flows from financing activities
Net proceeds from the issue of share
capital 9,235 -
Proceeds from new loan 4,016 6,825
Repayment of borrowings (1,931) (1,217)
Payment of finance lease liabilities (1,362) (425)
New finance lease arrangements 2,590 1,205
Dividends paid (820) (3,701)
--------- ---------
Net cash from financing activities 11,728 2,687
--------- ---------
Net increase in cash and cash equivalents 482 2,545
Cash and cash equivalents at 1 January (7,486) (10,031)
Cash and cash equivalents at 31 December (7,004) (7,486)
--------- ---------
Notes to the Consolidated Financial Statements
for the year ended 31 December 2018
1. Basis of Preparation and Principal Activity
These condensed preliminary financial statements for the year
ended 31 December 2018 have been prepared in accordance with the
recognition and measurement criteria of International Financial
Reporting Standards as adopted by the European Union ("Adopted
IFRS"), IFRS IC interpretations and those parts of the Companies
Act 2006 applicable to companies reporting under IFRS. The
financial statements are presented in Pounds Sterling, being the
functional currency of the Group, generally rounded to the nearest
thousand.
The information contained within this announcement has been
extracted from the audited financial statements which have been
prepared in accordance with IFRS as adopted by the European Union
('adopted IFRS'), and with those parts of the Companies Act 2006
applicable to companies reporting under adopted IFRS. They have
been prepared using the historical cost convention except where the
measurement of balances at fair value is required. The same
accounting policies, presentation and methods of computation are
followed in both of the preliminary condensed sets of financial
statements and the audited financial statements.
Availability of audited accounts
Copies of the 2018 audited accounts will be available later this
month on the Company's website (www.anexo-group.com) for the
purposes of AIM Rule 26 and will be posted to shareholders in due
course. The Company is a public limited company, which is listed on
the Alternative Investment Market of the London Stock Exchange and
incorporated and domiciled in the UK. The address of its registered
address office is 5(th) Floor, The Plaza, 100 Old Hall Street,
Liverpool, L3 9QJ.
Forward-looking statements
This report may contain certain statements about the future
outlook for Anexo Group plc. Although the directors believe their
expectations are based on reasonable assumptions, any statements
about future outlook may be influenced by factors that could cause
actual outcomes and results to be materially different.
Going concern
The Group is in advanced discussions with a specialist asset
funder to extend and increase existing facilities and secure
additional funding from the Group's current asset base to support
growth across all aspects of the business operations. This funding
is intended to support the Group's working capital as it continues
to expand its legal capacity and increase the rate of cash
conversion. Credit backed terms have been provided by the lender
which have been approved by the Board. Funds are expected to be
available to the Group in April 2019 subject to approval of revised
covenants and the satisfaction of routine administrative
matters.
In addition, discussions continue with both our existing lender
within Bond Turner Limited to renew our current facility which is
due to expire on 30 June 2019 as well as a further high street bank
to increase the current facility limit.
While the final agreement of these facilities is not certain,
the Board is confident that these conditions will be satisfied and
that the likelihood of the funding not being available is
remote.
It is considered that while there is sufficient cash headroom in
the forecasts, any impact on liquidity in the course of finalising
these arrangements or a decrease in expected cashflows could be
mitigated through short term actions the Group could take which are
not expected to impact longer term performance.
The Directors have prepared trading and cash flow forecasts for
a period of one year from the date of approval of these financial
statements. The Directors have a reasonable expectation that the
Group will have adequate cash headroom. The Group continues to
trade profitably and early indications for growth in the current
year are positive. Accordingly, the directors continue to adopt the
going concern basis in preparing the consolidated financial
statements.
2. Segmental Reporting
The Group's reportable segments are as follows:
-- the provision of credit hire vehicles to individuals who have
had a non-fault accident, and
-- associated legal services in the support of the individual
provided with a vehicle by the Group and other legal service
activities.
Management monitors the operating results of business segments
separately for the purpose of making decisions about resources to
be allocated and of assessing performance.
The year ended 31 December 2018
Credit Hire Legal Services Consolidated
GBP'000s GBP'000s GBP'000s
Revenues
Third Party 34,042 22,463 56,505
Total revenues 34,042 22,463 56,505
------------ --------------- -------------
Profit before taxation 10,889 3,395 14,284
------------ --------------- -------------
Depreciation and loss on
disposal 1,489 85 1,574
------------ --------------- -------------
Segment assets 73,896 36,453 110,349
------------ --------------- -------------
Capital expenditure 3,005 487 3,492
------------ --------------- -------------
Segment liabilities 27,791 6,757 34,548
------------ --------------- -------------
The year ended 31 December 2017
Credit Hire Legal Services Consolidated
GBP'000s GBP'000s GBP'000s
Revenues
Third Party 24,814 20,488 45,302
Total revenues 24,814 20,488 45,302
------------ --------------- -------------
Profit before taxation 7,690 6,891 14,581
------------ --------------- -------------
Depreciation and loss on
disposal 692 68 760
------------ --------------- -------------
Segment assets 52,613 29,702 82,315
------------ --------------- -------------
Capital expenditure 1,416 57 1,473
------------ --------------- -------------
Segment liabilities 15,306 11,377 26,683
------------ --------------- -------------
3. Operating Profit
Operating profit is arrived at after charging:
2018 2017
GBP'000s GBP'000s
Depreciation expense 1,563 760
Operating lease expense 4,221 3,800
Non-recurring administrative costs 1,411 -
Share based payments 384 -
Loss / (Gain) on disposal of property,
plant and equipment 11 (41)
Non-recurring administrative costs in the year ended 31 December
2018 of GBP1.4 million related to Placing and Admission to AIM by
the Company and the Group reorganisation undertaken in preparation
of this process. There were no non-recurring costs in the year
ended 31 December 2017.
4. Earnings Per Share
2018 2017
Number of shares: No. No.
Weighted number of ordinary shares
outstanding 110,000,000 110,000,000
Effect of dilutive options 2,200,000 2,200,000
------------ ------------
Weighted number of ordinary shares
outstanding - diluted 112,200,000 112,200,000
------------ ------------
Earnings: GBP'000s GBP'000s
Profit basic and diluted 11,405 12,487
------------ ------------
Profit adjusted and diluted 13,200 12,487
------------ ------------
Earnings per share: Pence Pence
Basic earnings per share 10.4 11.4
------------ ------------
Adjusted earnings per share 12.0 11.4
------------ ------------
Diluted earnings per share 10.2 11.1
------------ ------------
Adjusted diluted earnings per share 11.8 11.1
------------ ------------
The adjusted profit after tax for 2018 and adjusted earnings per
share are shown before non-recurring costs (net of tax) of GBP1.4
million (FY 2017: GBPNil) and share--based payment charges of
GBP0.4 million (FY 2017: GBPNil). The Directors believe that the
adjusted profit after tax and the adjusted earnings per share
measures provide additional useful information for shareholders on
the underlying performance of the business. These measures are
consistent with how underlying business performance is measured
internally. The adjusted profit after tax measure is not a
recognised profit measure under IFRS and may not be directly
comparable with adjusted profit measures used by other
companies.
5. Property, Plant and Equipment
Fixtures,
fittings
Property & Motor Office
improvements equipment vehicles equipment Total
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
Cost or valuation
At 1 January 2017 276 253 1,705 645 2,879
Additions 65 55 1,329 24 1,473
Disposals - - (800) - (800)
------------- ---------- --------- ---------- ---------
At 31 December
2017 341 308 2,234 669 3,552
Additions - 486 2,944 62 3,492
Disposals - - (721) - (721)
At 31 December
2018 341 794 4,457 731 6,323
------------- ---------- --------- ---------- ---------
Depreciation
At 1 January 2017 239 134 991 555 1,919
Charge for year 9 46 664 41 760
Eliminated on disposal - - (647) - (647)
------------- ---------- --------- ---------- ---------
At 31 December
2017 248 180 1,008 596 2,032
Charge for the
year 10 66 1,441 46 1,563
Eliminated on disposal - - (542) - (542)
At 31 December
2018 258 246 1,907 642 3,053
------------- ---------- --------- ---------- ---------
Carrying amount
At 31 December
2018 83 548 2,550 89 3,270
------------- ---------- --------- ---------- ---------
At 31 December
2017 93 128 1,226 73 1,520
------------- ---------- --------- ---------- ---------
6. Trade and Other Receivables
2018 2017
GBP'000s GBP'000s
Trade receivables 165,195 151,518
Provision for impairment of trade
receivables (89,205) (95,628)
Net trade receivables 75,990 55,890
Accrued income 22,457 16,176
Prepayments 532 165
Directors loan account 463 4,644
Other debtors 1,922 3,711
Deferred taxation 81 7
101,445 80,593
--------- ---------
The Group's exposure to credit and market risks, including
impairments and allowances for credit losses, relating to trade and
other receivables is disclosed in the financial risk management and
impairment of financial assets note.
Trade receivables stated above include amounts due at the end of
the reporting period for which an allowance for doubtful debts has
not been recognised as the amounts are still considered recoverable
and there has been no significant change in credit quality. Average
gross debtor days calculated on a count back basis were 418 at 31
December 2018 and 421 at 31 December 2017.
7. Borrowings
2018 2017
GBP'000s GBP'000s
Non-current loans and borrowings
Bank loans and overdrafts - -
Revolving credit facility - 4,900
Obligations under finance lease and
hire purchase contracts 851 438
Other borrowings 19 137
870 5,475
--------- ---------
Current loans and borrowings
Bank loans and overdrafts 12,536 7,688
Revolving credit facility 5,000 -
Obligations under finance lease and
hire purchase contracts 1,640 825
Other borrowings 2,762 1,260
21,938 9,773
--------- ---------
Direct Accident Management Limited uses an invoice discounting
facility which is secured on the trade receivables of that company,
the balance outstanding being reported within bank loans and
overdrafts. Security held in relation to the facility includes a
debenture over all assets of Direct Accident dated 11 October 2016,
extended to cover the assets of Anexo Group Plc and Edge Vehicles
Rentals Group Limited from 20 June 2018 and 28 June 2018
respectively. Agreed during the year were a Company guarantee and
indemnity from Anexo Group pic dated 20 June 2018 and Edge Vehicle
Rentals Group Limited dated 28 June 2018, as well as a cross
corporate guarantee with Professional and Legal Services Limited
dated 21 February 2018.
Direct Accident Management Limited is also party to the number
of finance leases which are secured over the respective assets
funded.
The revolving credit facility is secured by way of a fixed
charge dated 25 January 2017, over all present and future property,
assets and rights (including uncalled capital) of Bond Turner
Limited. The loan is structured as a revolving credit facility
which is committed for a two-year period, until June 2019, with no
associated repayments due before that date. Interest is charged at
3.75% over LIBOR.
8. Obligations Under Leases and Hire Purchase Contracts
Finance leases
The finance leases of the Group primarily relate to the hire
purchase of motorbikes. The total future value of minimum lease
payments under finance leases and hire purchase contracts are as
follows:
2018 2017
GBP'000s GBP'000s
Not later than 1 year 1,544 825
Later than 1 and not later than 5
years 947 438
2,491 1,263
--------- ---------
Operating leases
The Group lease a number of office and other premises as well as
a proportion of the motor vehicle fleet under non-cancellable
operating lease agreements. The total future value of minimum lease
payments is as follows:
2018 2017
GBP'000s GBP'000s
Operating leases
Not later than 1 year 3,821 1,901
Later than 1 and not later than 5
years 3,107 2,116
Later than 5 years 803 -
7,731 4,017
--------- ---------
The amount of non-cancellable operating lease payments
recognised as an expense during the year was GBP4.2 million (FY
2017: GBP3.8 million).
- Ends -
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR UGUAWCUPBGRR
(END) Dow Jones Newswires
April 09, 2019 02:00 ET (06:00 GMT)
Anexo (LSE:ANX)
Historical Stock Chart
From Mar 2024 to Apr 2024
Anexo (LSE:ANX)
Historical Stock Chart
From Apr 2023 to Apr 2024