Ince Group PLC (The) – INCE – Final Results

Ince Group PLC (The) – INCE – Final Results

For the year ended 31 March (£m)

2020

2019

% Growth

Revenue

98.5

52.6

+87%

Operating profit

26.2

15.2

+72%

   % margin

26.6%

28.9%

(230)bps

Adjusted* profit before tax

8.0

5.9

+36%

Adjusted** diluted earnings per share (p)

14.9p

18.8p

(21)%

Dividend per share (p)

6.0p

n/a

Net (debt)/cash

(9.0)

(2.9)

* Adjusted profit before tax is calculated as the profit before tax after adding back non-recurring items (as shown in note 11 to the financial statements) and after deducting the non-controlling interests shown in statutory accounts

** Adjusted earnings per share is computed from adjusted profit before tax after deducting taxation

 

Operational highlights

·      Compound revenue growth of almost 60% p.a. since listing in 2017  (both through acquisitions and organic growth)

·      Ince international offices now fully integrated into the Group’s operations giving wider sector and geographical coverage

·      More than 10 top tier lateral hires successfully embedded in the business

·      Group now operates from eight jurisdictions across the UK, EMEA and Asia

·      Collaborative selling across regions and expanded base of specialisms main driver of organic growth

·      Successful fundraising of £14m in February 2020

·      Completion and installation of wholly-owned multi-office, multi-currency practice management system.

Covid-19

·      Trading performance has been impacted in first quarter of FY 2021 by Covid-19 (c. 10% reduction in revenue versus budget)

·      Pre-existing infrastructure allowed all locations to move instantly to offsite working

·      Asia practices (impacted from January 2020) have now returned to their offices following Government guidance although in Hong Kong for example social distancing measures have been reintroduced. At present we are operating at pre-pandemic levels and ahead of budget in this region

·      Cash preservation through active engagement with colleagues, key suppliers and stakeholders to secure reductions and deferrals where appropriate.  At 31 March 2020 cash holdings were £5.2 million and at 30 July 2020 were £6.4 million after £1.3 million scheduled reductions in borrowings

 

Financial highlights

·      Revenue £98.5m (2019: £52.6m) +87%

·      Organic growth of revenue c. 5%

·      Operating profits £26.2m (2019: £15.2m) +72%

·      Adjusted* profit before tax £8.0m (2019: £5.9m) +36%

·      Non-recurring acquisition costs and related material items £1.7m (2019: £14.3m)

·      Adjusted** diluted earnings per share 14.9p (2018: 18.8p) -21%, reflecting equity issue

·      Dividend cancelled in view of uncertainty caused by Covid-19 (2019: 6.0p)

·      Net cash generated by operating activities £14.7m (2019: £5.9m)

·      Net borrowings £9.0m (2018: net borrowings £2.9m), £1.2 million of external debt repaid since draw down in June 2019 and pay down continuing

·      Profit and total comprehensive income for the year £21.8m (2018: £0.8m), diluted earnings per share 11.4p (2019: loss 28.1p )

* Adjusted profit before tax is calculated as the profit before tax after adding back non-recurring items (as shown in note 11 to the financial statements) and after deducting the non-controlling interests shown in statutory accounts

** Adjusted earnings per share is computed from adjusted profit before tax after deducting taxation

 

Outlook

Our strategy continues to be to grow revenue profitably through adding high performing partners to a single efficient administration operation.  We do this by recruiting high quality personnel, developing new business streams, acquiring complementary businesses and forging strategic alliances.

The underlying business has proven resilient and the Group now has a firmly established international presence with a very strong brand.

The Board considers that the Group has the strength, flexibility and commitment to prosper and grow for the benefit of shareholders and colleagues over the coming years.  Given the Covid-19 uncertainties, it is too early to provide guidance on the results for the current year.

 

Adrian Biles, Group Chief Executive, commented:

“I first want to thank my colleagues around the world without whom this year’s strong performance could not have been achieved. Their fortitude, hard work and flexibility during this challenging time has been remarkable. 

“We can justifiably claim that this has been a year of great progress.  While we narrowly missed our £100m revenue target, the fact that these results were achieved despite the disruption caused by Covid-19 shows the quality of the business we are building.

“This is the first announcement to include the whole of Ince for a full year. The power of the Ince brand continues to win clients and attract talent.

“Throughout the year we have recruited exceptionally high quality partners in the marine, aviation, energy and insurance sectors, expanded the overseas offices and moved into exciting high-growth sectors. Also we have welcomed Rampart Corporate Advisors Ltd together with a team of senior shipping colleagues from Bentleys, Stokes and Lowless to the Group.

“We are continuing to realise the full potential of the Ince brand and our first class people.”

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