Octagonal PLC Trading Update for Trading Subsidiary (1228M)
April 26 2018 - 1:00AM
UK Regulatory
TIDMOCT
RNS Number : 1228M
Octagonal PLC
26 April 2018
For immediate release
26 April 2018
Octagonal plc
("Octagonal" or the "Company")
Trading Update for Trading Subsidiary
Following completion of the reporting period to 31 March 2018,
Octagonal provides the following trading update for its principal
and wholly owned trading subsidiary - Global Investment Strategy UK
Ltd ("GIS").
The Board is very pleased to announce that GIS expects to report
EBITDA of GBP3.01 million, a record for the Group, on sales of
GBP6.53 million for the year ended 31 March 2018. This is a 39%
increase in profit (2017: GBP2.16 million) and 16% increase in
sales (2017: GBP5.62 million) from the previous year. These results
reflect the ongoing work we have undertaken to improve efficiencies
and reducing transaction costs as well as offering a broader range
of services to clients.
Highlights
-- Cash in the bank or equivalents more than GBP5m as at 31 March 2018
-- Sales increase 16% against FY2017
-- EBITDA increased 39% against FY2017
-- Net profit margins remain strong at 46%
-- Corporate finance and related activities represented 14% of sales in the period
-- Soft launch of SynerGIS Bonds Platform
-- Further developments with Hong Kong application to the SFC.
GIS expects to make an impairment charge this year against its
remaining pre-RTO non-core legacy investment: specifically, it
expects a charge of GBP50,000 against its Level 1 investment,
namely Inspirit Energy Holdings PLC, reducing the carrying value of
this investment to approximately GBP56,000.
The Group's audited results will be announced in due course.
John Gunn CEO commented;
"This year has seen the continued benefit of the work we have
done to streamline our operations. Margins have again improved year
on year which has enabled us to deliver strong profit growth,
whilst also increasing top line sales. This has come at a time of
economic uncertainty, the impact of Brexit and a strengthening
pound, which has a negative impact on our profits.
The year ahead looks positive as we expect to continue seeing
improvements in our operational capabilities and a greater
contribution from our ancillary businesses.
2018 has had its challenges from a regulatory perspective with
the introduction of Mifid II and PSD2. I am pleased to say that we
were able to implement these on schedule.
We had in the year declared our first dividend of GBP0.001 per
share and we look forward to declaring future dividends, subject to
sustainable growth.
Our application for regulatory approval in Hong Kong is ongoing
and we expect to provide the market with an update shortly. Our CEO
Samantha Esqulant and myself made several alternate visits to Hong
Kong in the past year and we have now made new appointments that
will enable us to launch our activities in this very dynamic market
shortly. This is expected to allow GIS to expand its Asian offering
to provide similar services to those currently available to our
existing global network of clients. We are closely monitoring these
costs, but we do not see them having any significant impact on our
earnings as they should be offset by increased income, which we
hope to generate from this region. We have started soft marketing
in the region and hope to build on the existing client base we
already have there.
The SynerGIS Bond platform was launched in November 2017 and we
continue to progress with this soft launch to develop market
awareness. Our management have risen to many challenges over the
past years in several fields that are new to them, but have
delivered impressively. I am pleased to say that the product is of
an excellent standard. The regulatory requirements are very high
and we continue to work with the competent authorities towards the
conclusion of the prospectus.
Our total investment to date in the project stands at less than
GBP387,000 and based on the last private equity investment, this
provides a valuation of GBP9.1m on the investment. GIS retains a
71.14% shareholding in the venture.
We will further update Shareholders once the Bond is ready to be
launched."
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
For further information please visit www.octagonalplc.com or
contact:
+44 (0) 20 7048
Octagonal Plc 9400
John Gunn, CEO
Beaumont Cornish Limited (Nominated Adviser
and Broker) +44 (0) 20 7628
James Biddle / Roland Cornish 3396
www.beaumontcornish.com
This information is provided by RNS
The company news service from the London Stock Exchange
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