Audited Results for the Year Ended 31 October 2021

Arden Partners plc

("Arden" or the "Company" or the "Group")

Audited results for the year ended 31 October 2021

Arden Partners plc (AIM: ARDN), the institutional stockbroking company, today announces audited results for the year ended 31 October 2021 ("FY21").

HIGHLIGHTS

Market overview

· UK equity markets remained buoyant throughout FY21, continuing the trend that started in the second half of 2020, with institutional investors prepared to support ambitious growing companies

· The AIM IPO market performed strongly in 2021 with 87 AIM IPOs raising a cumulative £1.9bn (2020: 32 IPOs raising a cumulative £0.5bn) (source: London Stock Exchange)

· The secondary fundraise market also had significant growth with £6.9bn raised by AIM listed companies in 2021, up from £5.3bn in 2020 (source: London Stock Exchange)

· Competition for capital was fierce, particularly in the second half of 2021

· M&A activity for both public and private companies remained strong

Operational highlights

· Arden completed 29 transactions in FY21 (FY20: 22 transactions) including:

o Three IPOs/Reverse Take Overs (FY20: 1 IPO/RTO)

o 15 equity fundraisings (FY20: 10 equity fundraisings)

· £193 million raised for listed clients (FY20: £90 million)

· Three Takeover Code transactions completed (FY20: 2 transactions)

· The work of the Company's Research and Corporate Finance teams was recognised by judges in a number of industry awards

Financial highlights

· Revenue up 56.5% to £9.3 million (FY20: £5.9 million)

· Profit before tax of £0.8 million (FY20: £1.4 million loss before tax)

· Basic earnings per share of 4.8p (FY20: 5.0p loss per share)

· Net asset value per share at year end up 24.4% to 17.3p (FY20: 13.9p)

Recommended all share offer for Arden Partners plc by The Ince Group plc (the "Acquisition")

· On 26 October 2021, the boards of The Ince Group plc ("Ince") and Arden announced that they had reached agreement on the terms of a recommended all share offer by Ince for the entire issued and to be issued ordinary share capital of Arden

· Strategic and financial rationale for the Acquisition as set out in the Scheme Document published on 20 December 2021

· Seven Ince shares for every 12 Arden shares allows Arden shareholders to participate in the potential value creation of the combined business

· Arden shareholder approval for the Acquisition obtained on 19 January 2022

· The Acquisition remains conditional on:

o the approval of the London Stock Exchange to Arden's re-application to be a nominated adviser on AIM following the change of control of Arden

o final sanction by the Court

Commenting on the results and Arden's outlook, Mark Ansell, Chairman, said:

"The excellent performance in FY21 was enabled by the strategies adopted by the Group to address industry and regulatory changes and the challenges posed by Covid-19. I continue to be very proud of our employees' efforts in ensuring that our business was able to deliver these strong results through such a challenging period.

"We believe the longer-term outlook for the UK equity markets remains robust despite the short-term economic outlook being highly uncertain. Arden's pipeline of both primary and secondary transactions is reassuring and we entered the new financial year with a positive outlook.

"Notwithstanding the current pipeline, as Arden is reliant on one-off and sizeable corporate transactions, it is dependent upon its clients and the business impact of short and long-term downturns in the market. The Board believes that the recommended all share offer benefits all stakeholders by securing Arden's position and enabling it to offer a wider range of services to a larger client base as part of a more diversified entity. We are working towards completing this deal in the near term."

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Notes for editors

Arden is a dedicated corporate adviser and multi-service stockbroker to small and mid-cap companies in the UK and their investors.

The core purpose of our business is the effective management of the needs of our significant and growing base of corporate clients, and the effective support of their relationships with existing and potential shareholders.

These relationships are enhanced by the quality of our corporate finance advice and industry research, and the strong market presence of our sales and trading teams.

Our corporate finance capabilities encompass M&A, corporate finance advisory, broking and Sponsor and NOMAD services. We represent our clients in private transactions and AIM and Main Market share issues.

Our research is designed to be sector focused, concentrating on top down thematic trends which highlight companies giving investors an exposure to the real growth areas of the small-cap and AIM markets.

The sales team's role is to keep institutions abreast of these themes and stock ideas. When there is a requirement for our corporate clients to raise money to fulfil their growth ambitions, the sales team is in a strong position to effect this, with its entrenched relationships with the UK institutional and non-institutional markets.

Our market making and trading teams provide liquidity in the shares of our corporate clients. We also trade the shares of non-client corporates on behalf of institutions.

The Arden Wealth Management team offers a bespoke service to our clients, with the ability to trade/invest in equities, bonds and a range of global investment funds, as well as allowing clients to participate in Primary and Secondary equity placings.

CHAIRMAN'S STATEMENT

In 2021, we saw a continued market recovery and equity market conditions that, for the most part, were very supportive of both primary and secondary fundraisings. Further, M&A conditions were strong with both corporate acquirors and private equity looking to deploy substantial cash piles. This was very much a continuation of the macro agenda from H2 2020.

Investors, however, began to show more caution towards the end of 2021, which we believe was a combination of investor fatigue, the high volume of deals looking for funding and concern over inflation, interest rates and supply chain issues.

Despite these challenges, we believe the outlook for UK equity markets remains robust. Investors still have substantial cash piles to deploy and the UK market remains attractively valued relative to global peers. We are announcing these results, however, against the backdrop of the human tragedy unfolding in Ukraine and our thoughts are with those who are directly and indirectly affected. Understandably, the market has been more volatile as a result of events in Ukraine and the number of new transactions is likely to remain subdued until this period of uncertainty is resolved.

We were pleased with the performance of the Company in FY21. Performance levels were much improved on recent years and were particularly strong in the first half. However, in common with much of the market, we saw a lull in activity in the summer period and we noted the caution and competition in the market towards the end of FY21. Despite these challenges, Arden continued to transact both primary and secondary business.

Overall, revenues for the year rose by 56.5% to £9.3 million (FY20: £5.9 million), with profit before tax of £0.8 million (FY20: £1.4 million loss before tax) and earnings per share of 4.8p (FY20: loss per share of 5.0p). We continued to keep a tight control on costs throughout FY21.

Our balance sheet remains strong. As at 31 October 2021 our net asset value per share was 17.3p (31 October 2020: 13.9p). We hold cash and cash equivalents in excess of our capital adequacy requirements and sufficient to protect us against short to medium term market fluctuations.

The current financial year started in a promising and profitable manner as we completed two IPOs and two equity fundraisings. We are also currently active on a number of M&A transactions. However, the short-term economic and geopolitical outlook is highly uncertain, resulting in a challenging time for investors and corporate clients alike. Beyond this, Arden's pipeline of both primary and secondary transactions is reassuring and we have a positive longer term outlook. We continue to believe the Group is well positioned in its markets, a position from which we can continue to execute our ongoing growth strategy.

Finally, we believe the recommended all share offer from Ince, announced on 26 October 2021, is an exciting strategic development for Arden as it secures it's position as an adviser and broker able to offer a wider range of services to a wider client base. The all share nature of the offer enables Arden shareholders to participate fully in the potential value creation of the enlarged group.

Mark Ansell

Chairman

4 April 2022

CHIEF EXECUTIVE'S STATEMENT

Overview

I was pleased with our performance over the financial year as a whole which resulted in a marked increase in revenue and our return to profitability. There was a good level of activity across all divisions and we were able to serve our clients with confidence and commitment.

I would like to thank all our clients and shareholders for their continued support and to express the appreciation of the entire Board for the considerable hard work and commitment of our staff.

Business review

During the year under review revenues increased by 56.5% to £9.3 million (2020: £5.9 million) and we achieved a profit before tax of £0.8 million (2020: loss before tax of £1.4 million). All divisions performed well with each delivering increased revenues.

Revenue summary

Corporate Finance

Corporate finance revenue growth of 22.5% resulted from an increase in deal volumes. The IPO market was buoyant throughout FY21 and investors were receptive to a wider range of investment opportunities than in previous years. We completed three IPOs in the year (2020: one) and 15 secondary fundraisings (2020: 10 secondary fundraisings) together with a number of M&A (both public and private) assignments and other transactions. In total we raised £193 million in new equity for our clients, a significant increase from the £90 million raised in FY20.

Investors began to show caution towards the end of 2021 which we believe was a combination of investor fatigue, the high volume of deals looking for funding and signs of concern over the economic outlook, particularly with regard to inflation, interest rates and supply chain issues. Although the short-term geopolitical and macroeconomic outlook is highly uncertain and creating challenges for investors and corporate clients alike, we believe the longer term outlook for UK equity markets remains robust.

The decrease in client numbers was disappointing, although this was partly the result of M&A and a number of de-listings. Retainer revenue from corporate clients was therefore broadly flat year on year. This trend, however, has been reversed in the new financial year and we have been delighted to have been appointed as advisor and/or broker to three new clients since our year end.

Equities

Our equities division benefited from strong returns produced by its equity trading operations, particularly in the first half of the year. As a provider of liquidity in more volatile small and mid-cap equities we are exposed to a certain level of market risk. In FY21, however, this volatility created a positive backdrop to the trading environment.

Other equity and research income remained broadly flat year on year. The repercussions of MiFID II, introduced in January 2018, will continue to impact this operation for as long as they remain in force in their current guise. We have been pleased to see a number of consultations by regulators and political bodies into various aspects of the UK equity markets and we have actively engaged on a number.

Access to research is a vital part of small and mid-cap investing. Our Research Portal provides investors with the greatest possible access to our corporate client research and is available by registering on our website (www.arden-partners.com). Our research is also available via the ResearchTree portal where our analysts have again been highly ranked this year.

Donald Brown

Chief Executive Officer

04 April 2022

FINANCE REVIEW

Revenue

Revenue for the full year totalled £9.3 million, an increase of 56.5% on the prior year. The increase in revenue was driven by an increase in the number of corporate transactions completed in the year, an increase in the funds raised for our clients and a material improvement in the profitability of the equity trading operation, particularly in the first half of the year.

Average headcount decreased by 11.6% in the year. The market for talent became increasingly competitive through the year as transactional activity levels remained high. Post year end, we have invested in a number of the teams, particularly at the junior and mid-level, in response to continued high transactional levels.

Average revenue per employee shows a substantial growth year-on-year, one of our key performance indicators.

Costs

Staff costs increased reflecting higher discretionary bonus payments in the year arising from the Company's financial performance. Non-staff costs continued to be tightly controlled, and with less impact than expected from Covid-19, reverted to a more normal level.

Liquidity position

The Group's liquidity position (which comprises cash and cash equivalents, market making equity positions, trade and other receivables) was £6.8 million at the year end (2020: £6.3 million).

Cash at bank as at 31 October 2021 was £2.5 million, a similar level to the prior year (2020: £2.4 million).

The Board believes that the liquidity position, which is an alternative performance measure, provides more useful information for shareholders on the underlying liquidity of the Group than the reported net assets number, as it focuses solely on the liquid assets of the Group.

Net asset position and capital adequacy

The Group's net assets at the year-end were £5.8 million (2020: £4.6 million), the increase being the result of the profitable trading in the year and the partial recognition of a deferred tax asset. Given the positive outlook for the Company together with the substantial tax losses available to it, the Board has taken the view to recognise some of these losses as a deferred tax asset. The capital adequacy ratio as at 31 October 2021 was 217% (2020: 249%).

The Group holds surplus capital on its balance sheet and continually assesses this position throughout the year. During the year, the Group improved the liquidity of its capital resources by realising certain assets into cash. This exercise confirmed to the Board that the Group's liquid assets could be accessed, at short notice, should market conditions remain depressed.

Steven Douglas

Group Finance Director

04 April 2022

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 October 2021

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 October 2021

The Financial Statements were approved by the Board of Directors and authorised for issue on DD MMM 2022.

Steven Douglas Mark Ansell

Group Finance Director Chairman

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended 31 October 2021

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 October 2021

Notes

1. The capital redemption reserve represents the nominal value of shares that have been cancelled that were previously held as Own Shares.

2. Own Shares represents shares purchased to be held as treasury shares at historical cost.

3. The Employee Benefit Trust reserve represents shares held in the parent Company by the Arden Partners Employee Benefit Trust which is consolidated in these financial statements in accordance with the accounting policy in note 1.

NOTES TO THE ACCOUNTS

1) Accounting policies

Arden Partners plc is a public limited company incorporated in the United Kingdom under the Companies Act 2006.

Basis of preparation

The same accounting policies, presentation and methods of computation are followed in these condensed set of financial statements as are applied in the Group's latest audited Report and Accounts for the year ended 31 October 2021.

2) Revenue

Revenue is wholly attributable to the principal activity of the Group and arises solely within the United Kingdom.

Included within revenue of the Equities Division is a profit of £752,000 (2020: loss £1,296,000) derived from the equity trading operation.

Included within revenue of the Equities Division is a profit of £146,000 (2020: £252,000) relating to the fair value adjustment of warrants held within assets that are fair valued through profit or loss.

Included within revenue of the Equities Division is a profit of £146,000 (2020: £300,000) relating to the fair value of a warrants over securities which was received as consideration for Corporate Finance services rendered.

The Directors are of the opinion that there are three operating segments and while segment revenues are reviewed internally business resources are not allocated to segments for the purposes of deriving either profit or assets. In 2021, none of the Group's customers contributed more than 10% of the Group's total revenue. In 2020, two of the Group's customers contributed revenue of £1,525,000, being more than 10% of the Group's total revenue.

3) Administrative expenses

4) Income tax expense

The tax credit in the current year of £0.4m benefited from the utilisation of brought-forward tax losses. The tax credit for the current year is lower than the expected 19% tax credit due to the following:

The differences are explained below:

The standard rate of corporation tax in the UK was 19% throughout the reporting period.

5) Earnings per share

In addition to the basic earnings per share, underlying earnings per share has been shown because the Directors consider that this gives a more meaningful indication of the underlying performance of the Group. Where applicable, all adjustments are stated after taking into consideration current tax treatment ignoring deferred tax.

The Directors believe that the underlying profit/(loss) and underlying profit/(loss) per share, which are alternative performance measures, provide more useful information for shareholders on the underlying performance of the Group than the reported numbers as they fairer reflect the underlying operating performance of the Group as these costs are not considered part of the usual operations.

The 3,635,000 (2020: 1,995,000) shares held by the Arden Partners Employee Benefit Trust and 4,304,724 (2020: 4,304,724) shares held in Treasury, being the weighted average number of treasury shares in issue during the year, have been excluded from the denominator.

In the prior year no adjustment has been made to the diluted loss per share of 4.5p as the dilution effect of the weighted average number of outstanding share options of 599,862 would be to decrease the loss per share.

6) Annual Report and Accounts

Copies of the 2021 Report and Accounts will be posted to shareholders shortly. Copies will also be available from the Company's registered office and from the Company's website www.arden-partners.com

The statutory accounts for the year ended 31 October 2021 will be delivered to the Registrar of Companies in due course.

Statutory accounts for the year ended 31 October 2020 have been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.