TIDMCNKS
RNS Number : 7676I
Cenkos Securities PLC
30 March 2015
Cenkos Securities plc ("the Company") together with its
subsidiaries ("the Group")
ANNUAL FINANCIAL RESULTS OF THE GROUP FOR THE YEAR ENDED 31
DECEMBER 2014
Cenkos Securities plc today announced its audited final results
for the year to 31 December 2014. The highlights of the results,
comparing them with the prior year, are:
Highlights
31-Dec-14 31-Dec-13
----------------------------------------------------- ------ --------- ---------
Revenue + 72% GBP88.5m GBP51.4m
Profit before tax + 152% GBP27.0m GBP10.7m
Cash + 9% GBP32.9m GBP30.3m
Basic earnings per share + 148% 35.2p 14.2p
Full year dividend per share paid and proposed + 42% 17p 12p
- includes proposed final dividend of 10p (2013:
8.5p)
- additionally, 9% of the Company's shares were
bought back in January 2015. The Company has now
returned GBP76.4 million of cash to shareholders
(equivalent to 118p per share) since it was floated
in 2006
Commenting on the final results, Chief Executive Officer Jim
Durkin noted:
"Our successful strategy of being a leading UK institutional
broker to growth companies and investment funds has led to us being
profitable in every year since our formation in 2004. This approach
continues to bear fruit and I am pleased to report a very strong
performance for 2014. We have materially increased our
profitability and earnings per share. We strengthened our position
as one of the leading brokers in London for growth companies. We
grew our client base and staff numbers. We achieved a market share
of 15% of all funds raised on AIM and acted as sole co-ordinator
and book runner on the flotation of The AA plc. All of this
demonstrates our ability to execute transactions across the small,
mid and large cap space. I would like to thank all of our clients
and staff for their continued support.
We are pleased with our performance since the start of 2015.
There continues to be strong institutional demand to fund high
quality companies and ideas. Since January we have been engaged in
a number of significant fundraisings and our current pipeline is
encouraging."
Enquiries:
Jim Durkin
Chief Executive Officer +44 20 7397
Cenkos Securities plc 8900
Dr Azhic Basirov / David Jones
/ Ben Jeynes
Nominated Adviser
Smith & Williamson Corporate Finance +44 20 7131
Limited 4000
David Rydell / Duncan Mayall +44 20 3772
Bell Pottinger 2500
Strategic report
Introduction
The Board of Cenkos is pleased to report that revenues and
profits were materially ahead of last financial year on the back of
increased fundraising for our growing list of clients. This
includes the GBP1,385 million IPO in June 2014 of The AA plc, where
Cenkos acted as sole bookrunner. We are rated as one of the leading
brokers in London for growth companies. AIM Advisers Rankings Guide
for January 2015 ranks the Company as the number one Nominated
Adviser ("Nomad") by client market capitalisation, and number two
Nomad and Stockbroker by number of AIM clients.
Our strategy
The Company was founded in 2004 and over the past ten years has
established a successful platform that has been profitable in every
year of its existence and delivered strong returns to
shareholders.
Our prime strategy is to build from these solid foundations to
become the pre-eminent UK institutional broker to growth companies
and investment funds admitted to trading or listed on a UK market.
We aim to achieve this through:
n Understanding the needs of our clients, enabling us to provide
successful fund raising and advice through an innovative and
entrepreneurial approach;
n Delivering sustainable, diversified and growing income
streams;
n Adding high quality individuals to the teams; and
n Managing costs and risks carefully.
Thereby delivering a high return on equity and shareholder value
through earnings growth and attractive cash returns to
shareholders.
Our business model
We provide corporate finance, corporate broking and securities
services to small and mid-cap growth companies and increasingly
larger companies, across a wide range of industry sectors, as well
as investment funds. We focus on companies that seek admission of
their shares to trading on AIM or the LSE's main market, or
companies that are already quoted on those markets. For growing
companies that require access to capital and international
exposure, AIM's flexibility, with its Nomad arrangements, provides
a firm foundation for financing and corporate development. We offer
our clients advice and access to equity finance at all stages of
their development.
Revenue streams
Cenkos earns fees from primary and secondary equity fundraising,
providing access to capital through acting as a key intermediary
between growth companies or investment funds and institutional
providers of capital. In 2014 we raised GBP2.8 billion of funds for
our clients and from when we first opened for business in August
2004 to the end of December 2014 have raised a total of almost
GBP12 billion for our clients - mainly acting as sole broker.
We aim to provide equity financing and strong and supportive
shareholder lists for companies and healthy returns for
institutional investors. Corporate finance fees are earned from
providing strategic advice and regulatory guidance to clients, as
well as advice on all forms of corporate transactions including
fundraisings, mergers and acquisitions, disposals, restructurings
and tender offers. Fees are also generated from acting as Nomad,
broker and/or financial adviser to our corporate clients.
Commission is earned from execution and research services and
revenue is also generated from our market-making activities.
As corporate broker, our clients' Boards engage us to:
n Create and maintain supportive shareholder registers;
n Provide an informed and effective interface with shareholders
and potential investors;
n Provide appropriate dealing liquidity in their company's
shares; and
n Advise on all pertinent market and regulatory issues.
Management systems and controls
We operate an efficient and flexible business model, well
adapted to a highly regulated environment. It is therefore critical
that we continue to maintain an appropriate and proportionate level
of systems and controls, commensurate with our size and complexity.
Our risk management processes are outlined in more detail in the
Corporate Governance section and in note 23 of the Annual
Report.
We manage our cost base carefully. We offer our client-facing
staff relatively low basic salaries but reward their performance
based on factors that include their net income generation. This
cost flexibility allows us to operate during economic downturns
more successfully than many of our competitors who have higher
levels of fixed or guaranteed pay. Further details on pay are
disclosed in the Directors' Remuneration Report. We selectively use
outsourcing partners to help us maintain this cost flexibility in
areas where volumes can be unpredictable. Our settlement and core
trading systems and associated support are outsourced.
Culture and people
Our success is based on maintaining experienced and stable
teams, whose members build professional relationships and achieve
results through a committed and entrepreneurial approach. We
endeavour to remunerate our staff to a level which not only retains
them but also motivates them to perform in line with the
longer-term growth objectives of the Company.
Our key objectives and key performance indicators ("KPIs")
Our key objectives are to:
n Grow the business by both retaining existing corporate clients
and winning new ones, helping clients achieve their strategies
through the provision of advice and fundraising capabilities,
ensuring we have the right calibre and number of staff deployed to
support this; and
n Reward our shareholders by remaining profitable and generating
a high return on equity (within acceptable risk limits), leading to
an attractive dividend yield - or other returns to shareholders
such as share buy-backs where appropriate - and strong share price
growth.
Our KPIs include, but are not limited to, measures such as:
n The size of our corporate client base (Nomad / broker /
financial adviser appointments): this increased from 125 in 2013 to
130 as at 31 December 2014. We won a number of new clients in the
year and grew this measure, even though several of our clients were
acquired in the year;
n Funds raised for clients: in 2014 we raised GBP2,816 million
(2013: GBP1,195 million) for our clients. We achieved a market
share of 15% of all fundraisings on AIM in 2014, and demonstrated
our ability to float large cap companies onto the LSE's main market
through The AA plc IPO, generating a 68% post-float return for IPO
investors on this transaction for the period to 20 March 2015
(source: LSE);
n Revenue per head, profit before tax, earnings per share:
revenue per head grew from GBP0.48 million in 2013 to GBP0.77
million in 2014 despite hiring activity in the year across the
business, including a new office in Liverpool and a convertible
bond desk. We continue to look to attract experienced staff who can
help grow our business. Our profit before tax rose 152% to GBP27.0
million in 2014. Operational leverage within the business model has
helped us grow profit before tax faster than revenues, despite
continued investment in core infrastructure and in net staff hires.
Our basic earnings per share ("EPS") grew 148% to 35.2p due to
higher profits;
n Post tax return on average equity, total shareholder returns:
our post tax return on average equity improved from 37% in 2013 to
60% in 2014. This level is far above industry averages, reflecting
both our profitability and careful management of surplus capital;
and
n Various key risk indicators, including capital resources and
cash. As at 31 December 2014 we held GBP32.9 million (2013: GBP30.3
million) of cash. We continue to maintain healthy cash reserves,
reflecting our positive cash flow cycle.
Review of the year
Financial results
Overall performance
We are pleased to report that performance in 2014 was very
strong. As at 31 December 2014 we were Nomad, broker or financial
adviser to 130 companies or trusts (2013: 125). Revenues grew on
the back of increased fundraising for our growing list of clients.
Costs rose primarily due to greater performance-related pay on the
back of increased profitability. Profit before tax was GBP27.0
million (2013: GBP10.7 million) and, as noted below, this 152%
increase reflected both a very material rise in revenues and the
benefits of operational gearing in the business. Basic earnings per
share rose by 148% to 35.2p (2013: 14.2p).
Revenues
Revenue increased by 72% to GBP88.5 million (2013: GBP51.4
million) due largely to a higher level of corporate activity -
including fundraising - by our expanding list of corporate clients.
The economic recovery the UK is experiencing has clearly benefited
equity markets, with the total funds being raised by all companies
on AIM in 2014 reaching GBP5,868 million, a 50% rise on 2013
(source: LSE AIM factsheet December 2014), with IPOs making up
GBP2,599 million of that figure (up 119% on 2013). We have been
well positioned to benefit from this tailwind given our strong
market position, helping our clients raise around 15% of all of the
funds raised on AIM in 2014. During the year we completed 38
transactions - including 12 IPOs - and helped our clients raise a
total of GBP2,816 million (2013: GBP1,195 million), including
GBP1,385 million on the IPO of The AA plc onto the main market of
the LSE. During the year we also completed seven M&A corporate
finance transactions (2013: seven). Our corporate finance revenue
(including fees from placings) rose 91% to GBP69.1 million in 2014
(2013: GBP36.2 million).
We remain ranked as one of the leading brokers in London for
growth companies, as demonstrated by AIM Advisers Rankings Guide
for January 2015 where we were ranked as number one Nomad by client
market capitalisation, second in terms of both Nomad and
Stockbroker for all AIM clients by number of clients, as well as
being ranked top Nomad for Oil and Gas and Consumer Services,
second for both Financials and Industrial clients and third for
both Consumer Goods and Technology companies by number of AIM
clients.
We make markets in the securities of all the companies where we
have a broking relationship to support the other services we
provide. We actively provide liquidity to the market and facilitate
institutional business in small, mid and selected large cap
equities. Our trading desks make markets in the shares of 413
(2013: 341) companies and investment trusts. Importantly, we
maintained a top three market share in 85% of our clients' stock.
Despite this we continue to restrict actively the amount of capital
committed to this activity to limit market risk exposure without
adversely affecting our market-making services and the revenue
generated.
Our corporate broking, market-making, research and commission
revenues rose 28% to GBP19.4 million in 2014 (2013: GBP15.2
million) as we experienced more favourable trading conditions and
higher commission income, helped in part by new staff hired in the
year. However, the pressure on secondary commissions shows no sign
of relenting, including the potential impact of recent FCA
initiatives in terms of the unbundling of dealing commission and
payment for equity research. We are confident that we can continue
to prosper in this environment because of our flexible cost model.
Our execution business is primarily focused on client facilitation.
We believe that this enhances our overall service offering to our
expanding client base.
Costs, profit and earnings per share
Costs of continuing operations rose by GBP20.8 million (51%) in
the year, primarily driven by higher performance-related pay on the
back of increased profitability. We have grown our average staff
numbers by 7% to 115 and incurred a GBP1.2 million rise in costs
when compared to 2013 due to increased staff bonuses resulting from
the Compensatory Award Phantom Dividend Plan 2009 ("CAP"). Payments
under this scheme are only triggered by the payment of a dividend
to ordinary shareholders. This amounted to an 8.5p final dividend
for 2013 paid in H1 2014 and a 7p interim dividend for 2014 paid in
November 2014 (4p for 2012's final dividend paid in H1 2013 and
3.5p interim dividend paid in 2013). Profit before tax increased by
152% to GBP27.0 million (2013: GBP10.7 million).
The tax charge for the year from continuing operations as
presented in the income statement was GBP5.6 million (2013: GBP2.1
million), which equates to an effective rate of tax of 21% (2013:
20%). Profit after tax increased by 148% to GBP21.3 million (2013:
GBP8.6 million). Basic earnings per share rose by 148% to 35.2p
(2013: 14.2p).
Financial position and cash flow
As at 31 December 2014, our net trading investments were GBP7.3
million (2012: GBP9.4 million). Cash held at 31 December 2014 was
GBP32.9 million (2013: GBP30.3 million). The year to 31 December
2014 saw an inflow of cash and cash equivalents of GBP2.6 million
(2012 inflow: GBP8.1 million). The net inflow in 2014 reflects a
number of factors including our profitable trading in 2014, offset
partly by a reduction in trade payables and the payment of
corporation tax and dividends.
Dividend and capital levels
We aim to retain sufficient capital and reserves to meet our
regulatory capital and cash requirements, after taking into account
anticipated future working capital needs and potential growth
requirements. As at 31 December 2014, we had a capital resources
surplus of GBP12.4 million (2013: GBP6.2 million) in excess of our
Pillar 1 and 2 regulatory capital requirements after considering
January's 2015 share buy-back (noted below) but before including H2
2014's retained earnings. Surplus capital rose by GBP6.2 million
when compared to 2013 due to profitable trading in 2014, offset by
the planned buy-back and dividends paid.
In December 2014 a Tender Offer was launched to purchase up to
5.7 million ordinary shares in Cenkos (9% of the issued share
capital). The Tender Offer subsequently returned GBP10.8 million of
surplus capital to shareholders when the offer closed in January
2015.
Since our flotation on AIM in October 2006, we have paid out
91.5p in dividends (prior to the 10p proposed final dividend for
2014 noted below) and bought back 15 million shares at a cost of
GBP17.2 million for cancellation (including the GBP10.8 million
Tender Offer completed in January 2015), thereby increasing the
Company's prospective earnings per share. We have therefore
returned GBP76.4 million of cash to shareholders equivalent to 118p
per share (before 2014's final dividend of 10p) since our flotation
in 2006.
No shares were bought back by Cenkos for cancellation in the
year (2013: 0.4 million shares were cancelled at a cost of GBP0.3
million) and no shares were acquired by Cenkos Securities Employee
Benefit Trust ("EBT") in the year (2013: 0.3 million shares were
purchased by EBT at a cost of GBP0.3 million). In July 2014 we
launched two HM Revenue & Customs approved all staff share
schemes - a Share Incentive Plan ("SIP") and a Save As You Earn
Sharesave ("SAYE") Scheme. During 2014 347,447 shares were
transferred from the EBT into the Cenkos Securities plc SIP to
satisfy Matching, Free and Dividend share awards made under that
scheme.
The Board proposes a final dividend of 10p per share (2013: 8.5p
per share). This makes a total dividend of 17p for the year (2013:
12p). The payment of this final dividend will trigger payments to
staff under the CAP of GBP1.4 million in the first half of 2015
(2013: final dividend of 8.5p led to a further GBP2.0 million of
staff costs in the first half of 2014). In setting the level of the
final dividend, the Board considered, inter alia, the GBP10.8
million Tender Offer paid in January 2015 to participating
shareholders as well as regulatory capital and cash requirements,
working capital needs and potential growth requirements.
Subject to approval at the Annual General Meeting to be held on
12 May 2015, the final dividend will be paid on 28 May 2015 to all
shareholders on the register at 1 May 2015. In line with existing
shareholder authorisation, the Board will continue to assess
opportunities for share buy-backs, tender offers and the funding of
share purchases by the EBT where this is beneficial to
shareholders.
People
The continued professionalism of our employees has enabled us to
achieve a robust performance for the year. We continue to look to
recruit staff attracted by our culture and business model, and a
further net 12 staff joined us in the year. We aim to take
advantage of further regional opportunities in the UK and in Asia.
We opened an office in Liverpool in December 2014 and plan to open
an office in Singapore in 2015.
We endeavour to remunerate our staff to a level and in a manner
which not only retains but also motivates them to perform in line
with the longer-term growth objectives of the Company. Our staff's
skill, commitment and determination will continue to provide us
with a solid platform on which to continue to build our franchise.
In recognition of the contribution our staff made to help build the
franchise that Cenkos now enjoys, "one-off" discretionary bonuses
were paid to staff in the year in addition to their annual
performance related bonus and we also launched two share schemes
for all staff - a SIP and a SAYE scheme.
Principal risks
We face a range of risks which could affect both our financial
performance and the achievement of our strategic objectives. One of
our key risks is that our income is dependent on the health of the
financial markets and in particular the economic conditions of the
UK and how they impact equity fundraising. Our business model has
been designed to minimise the impact of lower revenues by ensuring
that performance-related pay also falls to help compensate for
this. The primary economic environment in which we operate is the
UK and the majority of our transactions are in UK-based equities.
We therefore have limited direct exposure to the Eurozone and
immaterial foreign exchange risk.
Aside from the health of UK equity markets, the remaining risks
outlined below are those that we believe have the potential to have
a significant detrimental impact on our financial performance and
future prospects. These risks should not be regarded as a
comprehensive list of all the risks that the Company may
potentially face which could adversely impact performance or future
prospects. The key risk areas that could impact the Company's
future performance - and how they are managed - are noted below,
along with comments as to how our risk profile has changed in the
year, where relevant.
Principal risk Mitigation Change in the year
--------------------- ------------------------------- --------------------------------
Reputational All new business proposals are We continued to enhance the
risk subject to a rigorous appraisal processes supporting this
We believe that process followed by Committee
one of the greatest consideration and the quality of debate and
risks we face by the New Business Committee. subsequent actions.
comes from potential
damage to our
reputation.
Operational risk We continually review our risk We continued to refresh and
Operational risk framework to ensure that it refine our risk framework and
is the risk that properly the associated risk and
we will suffer reflects the risks to which we governance
a loss directly are exposed and that any fora.
or indirectly significant We have taken our internal
from inadequate operational risks and their audit resources in house,
or failed internal associated supplementing
processes, people, controls are reviewed, assessed this with external expertise
systems, or external and, where applicable, as and when required.
events. enhanced. In both February 2014 and
Other specific There is also an on-going February
operational risks process 2015 our business continuity
that are material for identifying, evaluating and plans were tested. No issues
to our performance managing the significant risks of concern were raised by these
are regulatory we face, including fraud and tests.
risk, people cybercrime.
risk and litigation Our business model relies on
risk. These key
are commented suppliers for our trading and
on in more detail settlement
below. systems. We maintain regular
dialogue
and meetings with them to
ensure
there is appropriate oversight
of the risks associated with
outsourcing.
We continuously review our
business
continuity plans, and have
disaster
recovery facilities in place in
order to mitigate any
substantial
disruption to our operations.
Regulatory risk We continue to ensure that the In light of the increasing
appropriate systems and regulatory burden being placed
controls, on regulated entities such
reporting, capital and as ourselves, we continued
liquidity to enhance our systems,
requirements are in place to processes
meet and controls. This includes
the on-going obligations of an enhanced compliance monitoring,
FCA regulated (IFPRU a focus on Conduct Risk and
Investment) the implementation of new
firm. This is focused regulatory
particularly processes associated with Basel
on our on-going obligations and III / Capital Requirements
responsibilities as an AIM Directive ("CRD") IV.
Nomad
and a UK Listing Authority
("UKLA")
Sponsor.
People risk We seek to minimise this risk In addition to increased bonus
Our employees by payments - reflecting our strong
are our greatest creating the right culture and financial performance in the
asset and the working environment and by year - we also launched two
future success rewarding HM Revenue & Customs approved
of the Company employees through an overall all staff share schemes, both
depends on our remuneration of which were well received
ability to attract package that is geared towards by staff.
and retain high performance, after
quality employees. consideration
of relevant risk factors, and
aim
to align the interests of both
employees and shareholders.
People risk is also mitigated
via
a senior management succession
planning process overseen by
the
Nomination Committee and Board.
Litigation risk There is always a risk that We were not subject to any
some litigation in the year.
form of litigious action may be
taken against the Company.
Before
any decision to enter into
litigation
is made, the Board, senior
management
and our legal advisers will
review
all aspects of the case to
assess
and consider if it is in the
best
interests of the Company and
ultimately
the shareholders to either
instigate
proceedings or defend ourselves
against any potential
litigation.
Credit, market We are exposed to limited No material change in the year.
and credit
liquidity risk risks in the normal course of
business
as our market making activities
are carried out on a delivery
versus
payment basis, hence face
settlement
risk or market risk in terms of
an underlying exposure to
equities.
To mitigate market risk we have
established individual stock
position
limits and overall trading book
limits. There are daily
procedures
in place to monitor any
position
limit excesses. We do, from
time
to time, take shares in lieu of
fees subject to appropriate
internal
signoffs. Some stocks traded on
AIM are subject to low levels
of
underlying liquidity.
To mitigate liquidity risk we
have
put in place an appropriate
liquidity
risk management framework. The
Board approves our Individual
Liquidity
Adequacy Assessment ("ILAA") at
least annually.
Financial risks are also discussed in more detail in note 23 to
the financial statements and include capital, equity price risk,
credit risk and liquidity risk. Our internal control and risk
management processes are discussed in more detail in the Corporate
Governance report in this Annual Report. It is not anticipated that
our risk profile will change materially in 2015.
Outlook
We are pleased with our performance since the start of 2015.
There continues to be good institutional demand to fund high
quality companies and ideas. Since January we have been engaged in
a number of significant fund raisings and our current pipeline is
encouraging.
Jim Durkin
Chief Executive Officer
27 March 2015
Forward-looking statements
These financial statements contain forward-looking statements
with respect to the financial condition, results, operations and
businesses of the Company. Although the Company believes that the
expectations reflected in these forward-looking statements are
reasonable, we can give no assurance that these expectations will
prove to have been correct. Such statements and forecasts involve
risk and uncertainty because they relate to events and depend upon
circumstances that will occur in the future. There are a number of
factors that could cause actual results or developments to differ
materially from those expressed or implied by forward-looking
statements and forecasts. Forward-looking statements and forecasts
are based on the Directors' current view and information known to
them at the date of this statement. The Directors do not make any
undertaking to update or revise any forward-looking statements,
whether as a result of new information, future events or
otherwise.
Consolidated income statement
For the year ended 31 December 2014 2014 2013
Note GBP 000's GBP 000's
--------------------------------------------------- ---- --------- ---------
Continuing operations
Revenue 3 88,516 51,433
Administrative expenses (61,704) (40,856)
Operating profit 26,812 10,577
Investment income - interest receivable 4 161 135
Interest expense 5 (1) (1)
Profit before tax from continuing operations for the
year 7 26,972 10,711
Tax 8 (5,644) (2,122)
Profit after tax 21,328 8,589
Attributable to:
Equity holders of Cenkos Securities plc 21,328 8,589
Basic earnings per share 10 35.2p 14.2p
Diluted earnings per share 10 32.0p 14.2p
The profit attributable to the Company in the year ended 31
December 2014 was GBP21.33 million (31 December 2013: GBP9.54
million).
Consolidated statement of comprehensive income
For the year ended 31 December 2014 2014 2013
GBP 000's GBP 000's
------------------------------------------------------ --------- ---------
Profit for the year 21,328 8,589
Amounts that will be recycled to income statement in
future periods
Gain on available-for-sale financial assets 132 -
Tax on available-for-sale financial assets (28) -
104 -
Total comprehensive income for the year 21,432 8,589
Attributable to:
Equity holders of Cenkos Securities plc 21,432 8,589
Consolidated statement of financial position
As at 31 December 2014 2014 2013
Notes GBP 000's GBP 000's
------------------------------------ ------ --------- ---------
Non-current assets
Property, plant and equipment 421 387
Deferred tax asset 2,042 1,024
2,463 1,411
Current assets
Trade and other receivables 19,717 19,349
Available-for-sale financial assets 729 1,080
Other current financial assets 10,014 13,706
Cash and cash equivalents 32,932 30,343
63,392 64,478
Total assets 65,855 65,889
Current liabilities
Trade and other payables (23,583) (35,508)
Other current financial liabilities (2,711) (4,289)
(26,294) (39,797)
Net current assets 37,098 24,681
Total liabilities (26,294) (39,797)
Net assets 39,561 26,092
Equity
Share capital 637 635
Share premium 232 -
Capital redemption reserve 93 93
Own shares (3,218) (3,228)
Available-for-sale reserve 104 -
Retained earnings 41,713 28,592
Total equity 39,561 26,092
The financial statements were approved by the Board of Directors
and authorised for issue on 27 March 2015. They were signed on its
behalf by:
Jim Durkin Mike Chilton
Chief Executive Officer Finance Director
27 March 2015 27 March 2015
Registered Number: 05210733
Consolidated cash flow statement
For the year ended 31 December 2014 2014 2013
Notes GBP 000's GBP 000's
-------------------------------------------------- ----- --------- ---------
Profit for the year 21,328 8,589
Gain on available-for-sale financial assets 104 -
Adjustments for:
Net finance income (160) (134)
Tax expense 8 5,644 2,122
Tax expense arising on available-for-sale asset 28 -
Depreciation of property, plant and equipment 386 311
Shares and options received in lieu of fees (3,443) (1,335)
Share-based payment expense 250 138
Operating cash flows before movements in working capital 24,137 9,691
Decrease / (increase) in net trading investments 5,976 (1,212)
Increase in trade and other receivables (379) (3,742)
(Decrease) / increase in trade and other payables (12,940) 10,406
Net cash flow from operating activities 16,794 15,143
Interest paid (1) (1)
Tax paid (4,815) (1,871)
Net cash flow from operating activities 11,978 13,271
Investing activities
Interest received 173 62
Purchase of property, plant and equipment (420) (148)
Net cash outflow from investing activities (247) (86)
Financing activities
Dividends paid 9 (9,386) (4,541)
Proceeds from issue of own shares 234 -
Acquisition of own shares by Cenkos Securities
Employee
Benefit Trust ("EBT") - (283)
Transfer of shares by EBT to employee share plans 10 -
Acquisition of own shares for cancellation - (289)
Net cash used in financing activities (9,142) (5,113)
Net increase in cash and cash equivalents 2,589 8,072
Cash and cash equivalents at beginning of year 30,343 22,271
Cash and cash equivalents at end of year 32,932 30,343
Consolidated statement of changes in equity
For the year ended Share Share Capital Own Available-for-sale Retained Total
31 December capital premium redemption shares reserve earnings
2014 reserve
GBP GBP GBP 000's GBP GBP 000's GBP GBP
000's 000's 000's 000's 000's
------------------- ------- ------- ---------- ------- ------------------ -------- -------
At 1 January 2013 638 - 90 (2,945) - 24,446 22,229
Profit for the year - - - - - 8,589 8,589
Total comprehensive
income
for the year - - - - - 8,589 8,589
Own shares acquired
in
the year - - - (283) - - (283)
Own shares acquired
in
the year for
cancellation (3) - 3 - (289) (289)
Credit to equity
for equity-settled
share-based
payments - - - - - 138 138
Credit to equity
for day
1 valuation of
acquired
share options - - - - - 12 12
Deferred tax on
share-based
payments - - - - - 237 237
Dividends paid - - - - - (4,541) (4,541)
At 31 December 2013 635 - 93 (3,228) - 28,592 26,092
Profit for the year - - - - - 21,328 21,328
Gain on
available-for-sale
financial assets
net of
tax - - - - 104 - 104
Total comprehensive
income
for the year - - - - 104 21,328 21,432
Shares issued in
the year 2 232 - - - - 234
Transfer of shares
to employee
share plans - - - 10 - - 10
Credit to equity
for equity-settled
share-based
payments - - - - - 250 250
Credit to equity
for day
1 valuation of
acquired
share options - - - - - 68 68
Deferred tax on
share-based
payments - - - - - 818 818
Current tax on
share-based
payments - - - - - 43 43
Dividends paid - - - - - (9,386) (9,386)
At 31 December 2014 637 232 93 (3,218) 104 41,713 39,561
Notes to the financial statements
1. Accounting policies
General information
Cenkos Securities plc is a company incorporated in the United
Kingdom under the Companies Act 2006 (Company Registration No.
05210733). These financial statements are presented in pounds
sterling because that is the currency of the primary economic
environment in which the Company operates. The Company has taken
advantage of the exemption under section 408 of the Companies Act
2006 and therefore has not produced a Company income statement or
accompanying notes.
Basis of accounting
The Company's consolidated financial statements are prepared in
accordance with International Financial Reporting Standards
("IFRS") and International Financial Reporting Interpretations
Committee ("IFRIC") interpretations adopted by the European Union,
and with those parts of the Companies Act 2006 applicable to
companies reporting under IFRS, with the prior period being
presented on the same basis.
Adoption of new and revised standards
During the year, a number of amendments to IFRS became effective
and were adopted by the Company, none of which had a material
impact on the Company's net cash flows, financial position,
statement of comprehensive income or earnings per share. Note 25
details the accounting standards and interpretations that are
issued, but not yet effective, up to the date of issuance of the
Company's financial statements. The Company intends to adopt these
standards, if applicable, when they become effective.
Basis of consolidation
The consolidated financial statements incorporate the financial
statements of the Company and entities controlled by the Company
made up to 31 December each year. Control is achieved where the
Company has the power to govern the financial and operating
policies of an investee entity so as to obtain benefits from its
activities. All intra-group transactions, balances, income and
expenses are eliminated on consolidation.
Going concern
The Company's business activities, together with the factors
likely to affect its future development and performance, the
financial position of the Company, its cash flows and liquidity
position are set out in the Strategic Report. In addition, note 23
of the Annual Report includes the Company's objectives, policies
and processes for managing its capital, its financial risk
management objectives, details of its financial instruments and its
exposures to credit risk and liquidity risk.
The financial statements of the Company have been prepared on a
going concern basis as the Directors have satisfied themselves
that, at the time of approving the financial statements and having
taken into consideration the strength of the Company's statement of
financial position and cash balances, the Company has adequate
resources to continue in operational existence for at least the
next 12 months from the signing of these financial statements.
Financial instrument
Financial assets and financial liabilities are recognised in the
Company's statement of financial position when it becomes a party
to the contractual provisions of the instrument.
Financial Assets
Financial assets are recognised and derecognised on trade date
when the purchase or sale of an investment is under a contract
whose terms require delivery of the investment within the time
frame established by the market concerned, and are initially
measured at fair value, net of transaction costs.
Financial assets are classified into the following specified
categories: financial assets as "at fair value through profit or
loss" ("FVTPL"), "held-to-maturity", "available-for-sale", and
"loans and receivables". The classification depends on the nature
and purpose of the financial assets and is determined at the time
of initial recognition. However, reclassification is possible when
the criteria in IAS 39.50 are met. There were no reclassifications
during the year.
Financial assets at fair value through profit or loss
Financial assets are classified as at FVTPL when the financial
asset is either held for trading or it is designated as at
FVTPL.
Financial assets are classified as financial assets at FVTPL
where the Company acquires the financial asset principally for the
purpose of selling it in the near term, the financial asset is a
part of an identified portfolio of financial instruments that the
Company manages together and has a recent actual pattern of
short-term profit taking, as well as all derivatives that are not
designated as FVTPL and hedging instruments. Financial assets at
fair value through profit or loss are stated at fair value, with
any resulting gain or loss recognised in the income statement. The
net gain or loss recognised in the income statement incorporates
any dividend or interest earned on the financial asset.
Trading investment
Trading investments pertain to investment securities which are
held for trading purposes. These investments comprise both long and
short positions and are initially measured at fair value excluding
transaction costs. Subsequently and at each reporting date, these
investments are measured at their fair values, with the resultant
gains and losses arising from changes in fair value being taken to
the income statement. Trading investments include securities which
have been received as consideration for corporate finance and other
services rendered.
Derivative financial assets
Derivative financial assets include equity options and warrants
over listed securities earned by the Company as part of fee
arrangements. The Directors consider that the initial valuation
reflects fair consideration for the services provided. All gains
and losses on subsequent valuations are recorded within revenue in
the income statement.
Available-for-sale investments
Unlisted shares held by the Company are classified as
available-for-sale investments and are initially measured at fair
value, including transaction costs. At each reporting date, these
investments are measured at their fair values and the resultant
gains and losses, after adjusting for taxation, are recognised
directly in other comprehensive income, until the security is
disposed of or is determined to be impaired, at which time the
cumulative gain or loss previously recognised in equity is included
in the net profit or loss for the period.
Loans and receivables
Loans and receivables are non-derivative financial assets with
fixed or determinable payments that are not quoted on an active
market. They are included in current assets, except for those with
maturities greater than 12 months after the reporting date which
are classified as non-current assets. Loans and receivables
comprise trade and other receivables and cash and cash equivalents
in the statement of financial position.
Trade and other receivables
Market debtors are measured at fair value. All other debtors are
measured at amortised cost using the effective interest method,
less any impairment. Appropriate allowance for estimated
irrecoverable amounts is recognised in the income statement when
there is objective evidence that the asset is impaired. The
allowance recognised is measured as the difference between the
asset's carrying amount and the present value of estimated future
cash flows discounted at the effective interest rate computed at
initial recognition.
Impairment of financial assets
Financial assets, other than those held for trading purposes or
designated at fair value through profit or loss, are assessed for
indicators of impairment at each reporting date. Financial assets
are impaired where there is objective evidence that as a result of
one or more events that occurred after the initial recognition of
the financial asset the estimated future cash flows of the
investment have been impacted. For loans and receivables the amount
of the impairment is the difference between the asset's carrying
amount and the present value of estimated future cash flows,
discounted at the original effective interest rate.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand
deposits and other short-term highly liquid investments, which are
readily convertible to a known amount of cash and are subject to an
insignificant risk of changes in value.
Derecognition of financial assets
The Company derecognises a financial asset only when the
contractual rights to the cash flows from the asset expire, or when
it transfers the financial asset and substantially all the risks
and rewards of ownership of the asset to another entity. If the
Company neither transfers nor retains substantially all the risks
and rewards of ownership and continues to control the transferred
asset, the Company recognises its retained interest in the asset
and an associated liability for amounts it may have to pay. If the
Company retains substantially all the risks and rewards of
ownership of a transferred financial asset, the Company continues
to recognise the financial asset and also recognises a
collateralised borrowing for the proceeds received.
Financial liabilities
Financial liabilities are classified as either financial
liabilities "at FVTPL" or "other financial liabilities".
Financial liabilities at FVTPL
Financial liabilities are classified as at FVTPL where the
financial liability is either held for trading or it is designated
as at FVTPL upon initial recognition.
A financial liability is classified as held for trading if:
n It has been incurred principally for the purpose of disposal
in the near future; or
n It is part of an identified portfolio of financial instruments
that the Company manages together and has a recent pattern of
short-term profit taking; or
n It is a derivative that is not designated and effective as a
hedging instrument.
A financial liability other than a financial liability held for
trading may be designated as at FVTPL upon initial recognition
if:
n Such designation eliminates or significantly reduces a
measurement or recognition inconsistency that would otherwise
arise; or
n The financial liability forms part of a Company of financial
assets or financial liabilities or both, which is managed and its
performance is evaluated on a fair value basis, in accordance with
the Company's documented risk management or investment strategy,
and information about the Company is provided internally on that
basis; or
n It forms part of a contract containing one or more embedded
derivatives, and IAS 39 Financial Instruments: Recognition and
Measurement permits the entire combined contract (asset or
liability) to be designated as at FVTPL.
Financial liabilities at FVTPL are stated at fair value, with
any resultant gain or loss recognised in the income statement. The
net gain or loss recognised in the income statement incorporates
any interest paid on the financial liability.
Trade and other payables
Trade payables are initially measured at fair value. At each
reporting date, these trade payables are measured at amortised cost
using the effective interest rate method.
Other financial liabilities
Other financial liabilities, including borrowings, are initially
measured at fair value, net of transaction costs.
Other financial liabilities are subsequently measured at
amortised cost using the effective interest method, with interest
which is recognised on an effective yield basis.
The effective interest method is a method of calculating the
amortised cost of a financial liability and of allocating interest
expense over the relevant period. The effective interest rate is
the rate that exactly discounts estimated future cash payments
through the expected life of the financial liability or, where
appropriate, a shorter period to the net carrying amount on initial
recognition.
Derecognition of financial liabilities
The Company derecognises financial liabilities when, and only
when, the Company's obligations are discharged, cancelled or they
expire.
Equity instruments
An equity instrument is any contract that evidences a residual
interest in the assets of an entity after deducting all of its
liabilities. Equity instruments issued by the Company are
recognised as the proceeds are received, net of direct issue
costs.
Derivative financial instruments
The Company has no significant exposure to derivative financial
instruments but will occasionally enter into futures to manage its
exposure to market risk.
Derivatives are initially recognised at fair value on the date a
derivative contract is entered into and are subsequently
re-measured to their fair value at each reporting date. The
resulting gain or loss is recognised in the income statement
immediately.
Financial guarantee contracts
Financial guarantee contracts issued by the Company are those
contracts that require a payment to be made to reimburse the holder
for a loss it incurs because the specified debtor fails to make a
payment when due in accordance with the terms of a debt instrument.
Financial guarantee contracts are recognised as a liability at fair
value. Subsequently, the liability is measured at the higher of the
best estimate of the expenditure required to settle the present
obligation at the reporting date and the amount initially
recognised less cumulative amortisation.
Provisions
Provisions are recognised when the Company has a present
obligation (legal or constructive) as a result of a past event, it
is probable that the Company will be required to settle that
obligation and a reliable estimate can be made of the amount of the
obligation.
The amount recognised as a provision is the best estimate of the
consideration required to settle the present obligation at the
reporting date, taking into account the risks and uncertainties
surrounding the obligation. Where a provision is measured using the
cash flows estimated to settle the present obligation, its carrying
amount is the present value of those cash flows.
When some or all of the economic benefits required to settle a
provision are expected to be recovered from a third party, a
receivable is recognised as an asset if it is virtually certain
that reimbursement will be received and the amount of the
receivable can be measured reliably.
Foreign currencies
Transactions in foreign currencies are recorded at the rate of
exchange at the date of the transaction. Monetary assets and
liabilities denominated in foreign currencies at the reporting date
are reported at the rates of exchange prevailing at that date.
Gains and losses arising during the year on transactions
denominated in foreign currencies are translated at the prevailing
rate and included in the income statement.
Investments in subsidiary undertakings
Investments held as fixed assets are stated at cost, less any
provision for impairment in value.
Operating leases
Rentals payable under operating leases are charged to the income
statement on a straight-line basis over the term of the relevant
lease. Where a rent free period or discount is negotiated it is
amortised over the period of the lease.
Property, plant and equipment
Property, plant and equipment is stated at cost, net of
depreciation and any provision for impairment. Depreciation is
provided at rates calculated to write off the cost, less estimated
residual value, of each asset evenly over its estimated useful life
as follows:
n Leasehold improvements: Remaining term of the lease
n Fixtures and fittings: Three years
n IT equipment: Three years
The carrying values of property, plant and equipment are subject
to annual review and any impairment is charged to the income
statement.
Taxation
The tax expense represents the sum of the tax currently payable
and deferred tax.
The tax currently payable is based on taxable profit for the
year. Taxable profit differs from net profit as reported in the
income statement because it excludes items of income or expense
that are taxable or deductible in other years and it further
excludes items that are never taxable or deductible. The Company's
liability for current tax is calculated using tax rates that have
been enacted or substantively enacted by the reporting date.
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in
the computation of taxable profit, and is accounted for using the
balance sheet liability method. Deferred tax liabilities are
generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which
deductible temporary differences can be utilised. Such assets and
liabilities are not recognised if the temporary difference arises
from the initial recognition of goodwill or from the initial
recognition (other than in a business combination) of other assets
and liabilities in a transaction that affects neither the tax
profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries and associates,
and interests in joint ventures, except where the Company is able
to control the reversal of the temporary difference and it is
probable that the temporary difference will not reverse in the
foreseeable future.
The carrying amount of deferred tax assets is reviewed at each
reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow
all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled or the asset is
realised. Deferred tax is charged or credited in the income
statement, except when it relates to items charged or credited
directly to equity, in which case the deferred tax is also dealt
with in equity.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied
by the same taxation authority and the Company intends to settle
its current tax assets and liabilities on a net basis.
Revenue recognition
Revenue is measured at the fair value of the consideration
received or receivable and represents amounts receivable for
services provided in the normal course of business, net of
discounts, VAT and other sales related taxes.
Revenue comprises fees for corporate finance advisory services
which are taken to the income statement at the point in time when,
under the terms of the contract, the conditions have been met such
that Cenkos is entitled to the fees specified. Revenue also
comprises profits on dealing operations, being gains less losses,
both realised and unrealised, on financial assets and financial
liabilities, arrived at after taking into account attributable
dividends and directly related interest, together with commission
income receivable.
Interest income is recognised at the effective interest rate
applicable, which is the rate that discounts estimated future cash
receipts through the expected life of the financial asset to that
asset's net carrying amount.
Dividend income from investments is recognised when the
shareholder's right to receive payment has been established.
Revenue includes the fair value of options over securities which
have been received as consideration for corporate finance services
rendered.
Segment reporting
IFRS 8 requires that an entity discloses financial and
descriptive information about its reportable segments, which are
operating segments or aggregations of operating segments. Cenkos is
managed as an integrated UK institutional stockbroking business and
although it has different revenue streams it has one consolidated
reportable segment. It considers its activities to be subject to
similar economic characteristics. The internal reports used by the
Chief Executive Officer for the purpose of monitoring performance
and allocating resources reflect that Cenkos is managed as a single
business unit.
Share-based payments
The Company has applied the requirements of IFRS 2: Share-based
payments. The Company issues equity-settled share-based payments to
certain employees. Equity-settled share-based payments are measured
at fair value (excluding the effect of non-market-based vesting
conditions) at the date of grant. The cost of these awards is
measured by reference to the fair value determined at the grant
date of the equity-settled share-based payments and the expected
number of employees likely to become fully entitled to the award.
This cost is expensed on a straight-line basis over the vesting
period. At each reporting date, the Company revises its estimate of
the number of equity instruments expected to vest as a result of
the effect of non-market-based vesting conditions. The impact of
the revision of the original estimates, if any, is recognised in
the income statement such that the cumulative expense reflects the
revised estimate, with a corresponding adjustment to equity.
Related party disclosures
The compensation of the key management personnel of the Company
and their interests in the shares and options over the shares of
Cenkos Securities plc are set out in note 24. Key management
personnel comprise Directors of the Company as they are able to
exert significant influence over the financial and operating
policies of the Company.
2. Critical accounting judgement and key sources of estimation
uncertainty
The preparation of financial statements in conformity with
generally accepted accounting principles requires the use of
judgements, estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during
the reporting period. Although these estimates are based on
management's best knowledge of the amount, event or actions, actual
results ultimately may differ from those estimates. The principal
risks that the Company faces are noted in the Strategic Report. The
estimates and assumptions that have a significant effect on the
carrying amounts of assets and liabilities are set out below:
a) Equity-settled share-based payments
The fair value of share-based payments is calculated using a
Monte Carlo simulation. Inputs into the model are based on
management's best estimates of expected volatility and risk free
rate of return, which are referred to in note 23. As a measure of
implied volatility of the share-based payment is not available, a
measure of the historic volatility of Cenkos' share price has been
used as a proxy. This expected volatility reflects the assumption
that the historical volatility over a period similar to the life of
the share-based payment is indicative of future trends, which may
not necessarily be the actual outcome.
b) Valuation of derivative financial assets
Derivative financial assets comprise equity options and warrants
over listed securities which include those received as non-cash
consideration for advisory and other services. On grant, these
instruments are fair valued. Thereafter, at each period end they
are revalued using a Monte Carlo simulation. Inputs to the model
include share price, risk free rate of return and implied
volatility. Although the underlying securities are listed, the
equity options and warrants themselves are not. As a measure of
implied volatility of the instrument is therefore not available,
either the historic volatility of the underlying security's share
price or that of a comparable company has been used as a proxy. The
Directors consider that the initial valuation reflects fair
consideration for the services provided.
c) Bad debt policy
The Company regularly reviews all outstanding balances and
provides for amounts where there is significant doubt over the
recoverability of the balance.
d) Provisions and contingent liabilities
Provisions are measured at the Directors' best estimate of the
expenditure required to settle obligations.
3. Business and geographical segments
Cenkos is managed as an integrated UK institutional stockbroking
business and although it has different revenue streams, the nature
of its activities is considered to be subject to similar economic
characteristics. The internal reports used by the Chief Executive
Officer for the purpose of monitoring performance and allocating
resources reflect that Cenkos is managed as a single business
unit.
Revenue is wholly attributable to the principal activity of the
Company and arises solely within the UK.
Major clients
In the year to 31 December 2014, one of Cenkos' clients
contributed more than 10% of Cenkos' total revenue. The amount was
GBP33.29 million (2013: no one particular client's revenues
accounted for more than 10% of the Company's total revenue).
4. Investment income - interest receivable
2014 2013
GBP000's GBP000's
-------------------------------- -------- --------
Interest income generated from:
Cash and cash equivalents 161 64
Trade and other receivables - 71
161 135
Interest income generated from trade and other receivables
includes the recognition of the unwinding of the discount factor
applied to loans due from staff related to the issue of the partly
paid B shares, which amounted to GBP nil (2013: GBP71,221).These
loans were fair valued when granted and the discount factor unwound
over the period until settlement. By 30 June 2013 all outstanding
amounts in respect of the B shares had been received by the
Company.
5. Interest expense
2014 2013
GBP 000's GBP 000's
-------------------------------------- --------- ---------
Interest on bank overdrafts and loans 1 1
6. Staff costs
2014 2013
GBP 000's GBP 000's
---------------------------- --------- ---------
Staff costs comprise:
Wages and salaries 45,538 29,231
Social security costs 6,188 3,949
IFRS 2 share-based payments 250 138
51,976 33,318
During 2014, in order to comply with the Pensions Act, Cenkos
was required to enrol all qualifying employees in a pension scheme.
Under the scheme, qualifying employees are required to contribute a
percentage of their relevant earnings. The Company also contributes
1% of relevant earnings.
The average number of employees (including executive Directors)
was:
2014 2013
------------------ ---- ----
No No
Corporate finance 22 20
Corporate broking 62 56
Administration 31 31
115 107
7. Profit for the year
Profit for the year has been arrived at after charging /
(crediting):
2014 2013
GBP 000's GBP 000's
------------------------------------------------------ --------- ---------
Operating lease rentals 524 532
Auditor's remuneration (refer to analysis below) 169 160
Depreciation of property, plant and equipment 386 310
Staff costs (see note 6) 51,976 33,318
Change in fair value of share options and warrants as
at FVTPL 196 (401)
The analysis of the auditor's remuneration is as follows:
2014 2013
GBP GBP 000's
000's
--------------------------------------------------------- ------ ---------
Fees payable to the Company's auditor and its associates
for the audit of the Company's
annual accounts and consolidation 130 120
Total audit fees 130 120
Fees payable to the Company's auditor for other services
to the Group:
- Half year review of the Company's interim report 35 30
- Other advisory services - including taxation 4 10
Total non-audit fees 39 40
169 160
--------------------------------------------------------- ------ ---------
8. Tax
The tax charge comprises:
2014 2013
GBP 000's GBP 000's
----------------------------------------------------------- --------- ---------
Current tax
United Kingdom corporation tax at 21.5% (2013: 23.25%)
based on the profit for the year 5,813 2,612
Adjustment in respect of prior period
United Kingdom corporation tax at 21.5% (2013: 23.25%) 31 25
Total current tax 5,844 2,637
Deferred tax
Credit on account of temporary differences (173) (495)
Deferred tax prior year adjustment (27) (20)
Total deferred tax (200) (515)
Total tax on profit on ordinary activities from continuing
operations 5,644 2,122
A reconciliation of the tax expense for 2013 and 2014 and the
accounting profit multiplied by the standard rate of UK corporation
tax of 21.5% (2013: 23.25%) is set out below:
2014 2013
GBP GBP 000's
000's
Profit before tax from continuing operations 26,972 10,711
Tax on profit on ordinary activities at the UK corporation tax
rate of 21.5% (2013: 23.25%) 5,799 2,491
Tax effect of:
Non-deductible expenses for tax purposes 152 104
Income not subject to corporation tax - (15)
Recognition of deferred tax previously unrecognised (336) (621)
Deferred tax rate change adjustment 25 148
Adjustment for loss relief not claimed - 10
Adjustment in respect of prior period deferred tax (27) (20)
Adjustment in respect of prior period current tax 31 25
Tax expense for the year 5,644 2,122
---------------------------------------------------------------- ------ ---------
In addition to the tax expense presented in the income
statement, the following amounts have been recognised directly in
equity:
2014 2013
GBP 000's GBP 000's
---------------------------------------------------- --------- ---------
Other Comprehensive Income (OCI)
Current tax expense arising on available-for-sale
financial asset 28 -
Statement of Changes in Equity (SOCIE)
Current tax credit arising on share-based payments (43) -
Deferred tax credit arising on share-based payments (818) (237)
Total income tax recognised directly in equity (833) (237)
9. Dividends
Amounts recognised as distributions to equity holders in the year:
2014 2013
GBP 000's GBP 000's
------------------------------------------------------ --------- ---------
Final dividend for the year ended 31 December 2013 of
8.5p (December 2012: 4p) per share 5,128 2,430
Interim dividend for the period to 30 June 2014 of 7p
(June 2013: 3.5p) per share 4,258 2,111
9,386 4,541
A final dividend of 10 pence per share has been proposed for the
year ended 31 December 2014 (2013: 8.5p). Subject to approval at
the Annual General Meeting to be held on 12 May 2015, the final
dividend will be paid on 28 May 2015 to all shareholders on the
register at 1 May 2015. The payment of a dividend to ordinary
shareholders triggers a cash payment to holders of options under
the 2009 Compensatory Award Plan ("CAP"). The payment of this final
dividend will lead to a further GBP1.44 million of staff costs in
the first half of 2015 (8.5p final dividend in respect of 2013 led
to a further GBP2.04 million of staff costs in the first half of
2014).
10. Earnings per share
2014 2013
--------------------------- ----- -----
Basic earnings per share 35.2p 14.2p
Diluted earnings per share 32.0p 14.2p
------------------------------- ----- -----
The calculation of the basic and diluted earnings per share is
based on the following data:
2014 2013
GBP 000's GBP 000's
-------------------------------------------------------- --------- ---------
Earnings
Earnings for the purposes of basic and diluted earnings
per share being net profit attributable to
equity holders of the parent 21,328 8,589
2014 2013
No. No.
------------------------------------------------------------ ---------- ----------
Number of shares
Weighted average number of ordinary shares for the purposes
of basic earnings per share 60,530,876 60,525,904
Effect of dilutive potential ordinary shares:
Share options 6,132,434 -
Weighted average number of ordinary shares for the purpose
of diluted earnings per share 66,663,310 60,525,904
The Board has agreed to continue to fund the Company's Employee
Benefit Trust ("EBT") so that it can make market purchases in
Cenkos Securities plc's shares as and when market conditions allow.
During the year, no further ordinary shares were purchased (2013:
314,753 shares were purchased for an aggregate consideration of
GBP282,356), however 347,447 shares were transferred out at average
cost to the Cenkos Securities plc Share Incentive Plan to satisfy
awards under that scheme. As at 31 December 2014 the EBT held a
total of 2,811,030 (2013: 3,158,477) ordinary shares at an
aggregate consideration of GBP2.87 million (2013: GBP3.23 million).
These shares are held by the trust and have been excluded from the
weighted average number of shares calculation. The table below
shows the number of shares held by the Company's EBT.
2014 2013
No. No.
----------------------------------------------------- --------- ---------
Number of shares held by the Company's EBT
At 1 January 3,158,477 2,843,724
Acquired during the year - 314,753
Transferred to Cenkos Securities plc Share Incentive
Plan (347,447) -
2,811,030 3,158,477
11. Events after the reporting period
The Board announced on 17 September 2014 that as a result of the
Company's recent financial performance it was, in addition to the
payment of an interim dividend in respect of the first half of
2014, evaluating means of returning further value to shareholders
during the remainder of 2014. The Board therefore launched a Tender
Offer in December 2014 to purchase up to 9% of the Company's issued
share capital for subsequent cancellation. As a result of this, the
Company's broker, Smith & Williamson, purchased 5,727,340
ordinary shares in the Company in January 2015 at a cost of
GBP10.8m and these were subsequently cancelled by the Company.
There were no other material post-balance sheet events after the
reporting period.
Additional Information
The financial information included in this statement does not
constitute the Group's statutory accounts (within the meaning of
section 434 of the Companies Act 2006) for the years ended 31
December 2014 or 2013, but is derived from those accounts.
Statutory accounts for 2013 have been delivered to the Registrar of
Companies and those for 2014 will be made available to the public
from the Company's website and delivered following the Company's
Annual General Meeting. The auditors have reported on those
accounts; their reports were unqualified, did not draw attention to
any matters by way of emphasis without qualifying their report and
did not contain statements under s498(2) or (3) Companies Act 2006
or equivalent preceding legislation.
The Annual General Meeting of Cenkos Securities plc will be held
at 6.7.8. Tokenhouse Yard, London EC2R 7AS on 12 May 2015.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR JRMRTMBJTBFA
Cenkos Securities (LSE:CNKS)
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부터 6월(6) 2024 으로 7월(7) 2024
Cenkos Securities (LSE:CNKS)
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부터 7월(7) 2023 으로 7월(7) 2024
