FRP Advisory Grp PLC – FRP – Half Year Trading Update

FRP Advisory Grp PLC – FRP – Half Year Trading Update

FRP Advisory Group plc, a leading UK professional services firm specialising in advisory services, today announces a trading update for the half year ended 31 October 2020.

 

Trading performance

 

The Group delivered another strong performance during the first half, continuing to grow and win larger and more complex mandates. This includes a recent high-profile appointment in the Group’s Restructuring division on the administration of Edinburgh Woollen Mill. This growth was achieved despite the significant reduction in the number of formal insolvency appointments within the marketplace compared with the prior year, as a result of the support measures made available by the UK Government in response to the COVID-19 pandemic.

 

As a result, the Group expects to report revenues for the half year to 31 October 2020 of £35.9m, up 14% on the prior year (H1 2019: £31.4m), and underlying adjusted EBITDA* of £9.7m, up 7% on the prior year (H1 2019: £9.1m), in line with the Board’s expectations.

 

*Our underlying adjusted EBITDA compares the current model of partner compensation on a like-for-like basis to the prior corresponding period, as the business was previously a full distribution partnership. It also excludes exceptional costs and a share based payment expense that arises from the existing Long Term Incentive Plan. As the shares for this nil cost option plan were delivered to a trust on IPO, we do not expect the expense for this LTIP to impact distributable reserves.

 

Balance sheet and liquidity

 

The Group’s balance sheet remains strong with an unaudited cash balance as at 31 October 2020 of £15.2m and an undrawn revolving credit facility of £5m.

 

People and operations

 

The Board remains focused on the health, safety and wellbeing of all colleagues. Throughout the COVID-19 pandemic period we have operated without interruption and continue to during the current national lockdown in the UK. Colleagues have adapted well to remote working during lockdown periods and previous investments in our IT infrastructure have proven to be invaluable.

 

We have also continued to grow our headcount via demand-led new lateral hires and three complementary acquisitions in Newcastle, East Anglia and Kent. We now have 63 partners and 354 colleagues, 335 fee earners (colleagues and partners). This compares to 52 partners and 287 colleagues, 270 fee earners (colleagues and partners) at 31 October 2019. FRP’s offices across 19 locations in the UK continue to work well together, drawing on specialists from different service lines as necessary, in order to deliver the best possible service and outcome.

 

Notice of results

 

The Group expects to report its unaudited results for the half year ended 31 October 2020 on 16 December 2020.

 

Geoff Rowley, Chief Executive Officer of FRP Advisory Group plc, said:

 

“We continued to execute our growth strategy during the first half, delivering another pleasing performance, increasing our headcount and strengthening our referral client base. Integration of the teams relating to the three acquisitions we completed during the period is progressing well.

 

We have a resilient business model, with complementary service lines helping clients throughout their entire lifecycle. The medium-term outlook for our market is positive, despite the substantial degree of uncertainty around the shape and scale of the UK’s economic recovery. The Group has sufficient resource flexibility to service an increase in demand. The Board remains confident of making further progress in the current financial year.”

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