1st Sep 2005 07:02
Rathbone Brothers PLC01 September 2005 1 September 2005Rathbone Brothers PlcInterim results for the six months to 30 June 2005 Rathbones announces solid growth in profits and funds under management Rathbone Brothers Plc, a leading provider of discretionary fund management andwealth management services for private clients and trustees, today announces itsinterim results for the six months to 30 June 2005 prepared under theInternational Financial Reporting Standards (IFRS) regime. Results forcomparative periods have been restated for IFRS. Mark Powell, Chairman of Rathbone Brothers Plc, commented: "Pre-tax profits(before one-off costs of £1.4m associated with our approach to Rensburg)increased by 21.1% over the first half of 2005 to £16.1m. Total funds undermanagement rose by 9.1% to £8.4bn, including funds under management in our unittrust company which are now over £1bn." Highlights• Operating profit (before one-off costs of £1.4m) of £16.1m, an increase of 21.1% (30 June 2004: £13.3m. Full year 2004: £28.5m).• Operating profit (after one-off costs) of £14.7m, an increase of 10.5% (30 June 2004: £13.3m. Full year 2004: £28.5m).• Total funds under management increased by 9.1% over the six months to 30 June 2005 to £8.4bn compared with an increase in the FTSE 100 Index of 6.2% and an increase in the FTSE APCIMS Balanced Index of 5.1% over the same period.• Funds managed by Rathbone Unit Trust Management increased by 20.2% over the period to £983m as at 30 June 2005 and have now risen to over £1bn.• Operating income increased by 14.0% to £53.9m (30 June 2004: £47.3m. Full year 2004: £95.5m).• Reported earnings per share have risen by 9.4% to 25.46p (30 June 2004: 23.28p) but excluding the one-off costs have risen by 19.5%.• Interim dividend is increased by 9.5% to 11.5p per share. "The increase in funds under management is testimony to our ability to attractand retain client funds. We remain committed to providing a segregatedinvestment management service for clients with sums in excess of £100,000. TheRathbone service continues to be provided on a personal basis by a qualifiedfund manager. Plans are well underway for an increased marketing effort inrelation to SIPPs in anticipation of legislative changes next year. "A particularly pleasing aspect of the first half has been the success of ourunit trust company whose funds under management now exceed £1bn, compared with£818m at 31 December 2004, demonstrating excellent long-term investmentperformance and strong marketing and client service. "World stock markets have maintained their comparative strength since 30 June2005, despite the political and economic uncertainties which exist. Levels ofnew business enquiries are encouraging and we look forward with confidence." For further information contact: Rathbone Brothers Plc Fishburn Hedges020 7399 0000 (Switchboard) 020 7839 4321 (Switchboard)Mark Powell, Chairman Andrew MarshallAndy Pomfret, Chief Executive Sarah FrostSue Desborough, Finance DirectorEmily Morris, Marketing Director CHAIRMAN'S STATEMENT A more favourable environment in world stock markets has provided the backdropfor solid progress by Rathbones during the first half of 2005. Pre-tax profits (before one-off professional advisory costs of £1.4m incurred inrelation to the approach to Rensburg plc) for the six months to 30 June 2005were £16.1m, compared with £13.3m in the first half of 2004 (an increase of21.1%) and £28.5m for the whole of 2004. Reported earnings per share have risenby 9.4% to 25.46p, compared to 23.28p for the same period in 2004 and excludingthe Rensburg-related costs, earnings per share have risen by 19.5%. The interimdividend is increased by 9.5% to 11.5p per share payable on 14 October 2005. The figures for the first six months of 2005 have been prepared under theInternational Financial Reporting Standards ('IFRS') regime as well as those forthe first half of 2004 and the full year 2004. The effects of IFRS on our fullyear 2004 figures were announced at the beginning of August with the mostsignificant impact resulting from the cessation of goodwill amortisation. Over the six months to 30 June 2005, funds under management rose by 9.1% to£8.4bn. During the same period the UK equity market, as measured by the FTSE 100Index, rose by 6.2% and the FTSE APCIMS Balanced Index by 5.1%. This increase infunds under management is testimony to our ability to attract and retain clientfunds. We remain committed to providing a segregated investment managementservice for clients with sums in excess of £100,000. The Rathbone servicecontinues to be provided on a personal basis by a qualified fund manager. Plansare well underway for an increased marketing effort in relation to SIPPs inanticipation of legislative changes next year. A particularly pleasing aspect of the first half has been the success of ourunit trust company whose funds under management now exceed £1bn, compared with£818m at 31 December 2004, demonstrating excellent long-term investmentperformance and strong marketing and client service. The Rathbone range of unittrusts has been especially well suited to client demand during the last 12months. Our Income Fund has attracted net new funds of £115m in the six monthperiod. In our Trust Division, profits for the six months of the year are 25% lower thanthe first half of last year but some 8% higher than in the second half of 2004.Whilst the majority of the business has performed well, these results reflectsome of the costs of the continuing process of refocusing and aligning certainparts of the division's activities with our clients' requirements and ourcorporate objectives. In the first half of this year (and as referred to above), we incurred costs of£1.4m in connection with an approach to Rensburg. This was based upon our strongbelief in the compatibility of the two businesses and reflected Rathbones'confidence in the strength of our operating platform and the ability to handlesubstantially increased volumes of funds under management efficiently andcost-effectively. Our ambition remains that of becoming the leading independentprovider of investment management services to private individuals and trusteesin the UK. World stock markets have maintained their comparative strength since 30 June2005, despite the political and economic uncertainties which exist. Levels ofnew business enquiries are encouraging and we look forward with confidence. Mark PowellChairman31 August 2005 CONSOLIDATED INCOME STATEMENTfor the six months ended 30 June 2005 Unaudited Unaudited IFRS IFRS Unaudited Six months Six months IFRS ended ended Year ended 30 June 30 June 31 December 2005 2004 2004 £'000 £'000 £'000-------------------------------- ------------ ------------ ------------Interest and similar income 13,180 9,517 20,759Interest expense and similarcharges (7,141) (4,554) (10,477) ------------ ------------ ------------Net interest income 6,039 4,963 10,282 ------------ ------------ ------------ Fee and commission income 49,911 43,395 86,067Fee and commission expense (3,149) (1,984) (4,276) ------------ ------------ ------------Net fee and commission income 46,762 41,411 81,791 ------------ ------------ ------------Dividend income 15 12 915Net trading income 685 454 919Gains less losses frominvestment securities - - 759Other operating income 360 418 861 ------------ ------------ ------------Operating income 53,861 47,258 95,527 Operating expenses (39,178) (34,000) (67,035) ------------ ------------ ------------Aborted acquisition costs(Note 4) (1,375) - -Other operating expenses (37,803) (34,000) (67,035) ------------ ------------ ------------ ------------ ------------ ------------Profit before tax 14,683 13,258 28,492 ------------ ------------ ------------Profit before abortedacquisition costs and tax 16,058 13,258 28,492Aborted acquisition costs (1,375) - - ------------ ------------ ------------Tax (4,257) (3,786) (8,540) ------------ ------------ ------------Profit for the periodattributable to equityholders of the Company 10,426 9,472 19,952 ------------ ------------ ------------ Earnings per share for profitattributable to the equity holders of theCompany during the period (Note 5): - basic 25.46p 23.28p 48.99p- diluted 25.16p 23.06p 48.07p Dividend per ordinary share(Note 6) 11.5p 10.5p 27.5pDividend (£'000) 4,719 4,276 11,221 CONSOLIDATED BALANCE SHEETas at 30 June 2005 Unaudited Unaudited Unaudited IFRS as at IFRS as at IFRS as at 30 June 30 June 31 December 2005 2004 2004 £'000 £'000 £'000----------------------------------- ---------- ---------- ----------AssetsCash and balances at centralbanks 306 302 15,840Settlement balances 32,939 36,473 11,199Loans and advances to banks 141,634 39,870 57,881Loans and advances tocustomers 38,465 39,292 41,226Investment securities 6,203 6,255 7,219- available-for-sale 403,297 385,003 381,119- held-to-maturityIntangible assets 60,120 59,978 59,860Property, plant and equipment 4,185 4,727 4,480Deferred tax asset 5,042 3,672 4,379Prepayments, accrued incomeand other assets 28,044 21,870 22,154 ---------- ---------- ----------Total assets 720,235 597,442 605,357 ---------- ---------- ----------LiabilitiesDeposits by banks 3,718 4,695 3,243Settlement balances 26,630 42,528 15,238Derivative financialinstruments - 13 19Due to customers 525,302 403,303 425,078Debt securities in issue 170 336 286Accruals, deferred income,provisions and otherliabilities 23,360 18,268 23,003Current tax liabilities 4,867 4,520 6,067Retirement benefitobligations 15,603 12,998 14,983 ---------- ---------- ----------Total liabilities 599,650 486,661 487,917 ---------- ---------- ----------EquityShare capital 2,054 2,036 2,043Share premium 16,220 13,988 14,766Other reserves 53,746 53,782 54,457Retained earnings 48,565 40,975 46,174 ---------- ---------- ----------Total equity 120,585 110,781 117,440 ---------- ---------- ----------Total equity and liabilities 720,235 597,442 605,357 ---------- ---------- ---------- CONSOLIDATED CASH FLOW STATEMENTfor the six months ended 30 June 2005 Unaudited Unaudited IFRS IFRS Unaudited Six months Six months IFRS ended ended Year ended 30 June 30 June 31 December 2005 2004 2004 £'000 £'000 £'000--------------------------------- --------- --------- ---------Cash flows from operatingactivities Profit before tax 14,683 13,258 28,493Gain less losses frominvestment securities - - (759)Provision for bad anddoubtful debts 401 121 -Profit on disposal of plantand equipment (41) (39) (131)Depreciation and amortisation 1,295 1,278 2,629Share based payment charges 1,007 664 1,329 --------- --------- --------- 17,345 15,282 31,561 Changes in operating assets andliabilities - net (increase) in loans andadvances to banks andcustomers (17,445) (3,756) (9,793)- net (increase)/decrease insettlement balance debtors (21,740) (22,951) 2,323- net (increase) inprepayments, accrued incomeand other assets (5,930) (1,510) (1,713)- net increase in amounts dueto customers and deposits bybanks 101,281 36,659 56,317- net increase in settlementbalance creditors 11,393 31,152 3,862- net increase in accruals,deferred income, provisionsand other liabilities 415 3,582 8,151- net increase in retirementbenefit obligations (262) 144 284 --------- --------- ---------Cash generated fromoperations 85,057 58,602 90,992Tax paid (5,534) (3,736) (7,004) --------- --------- ---------Net cash inflow fromoperating activities 79,523 54,866 83,988 --------- --------- ---------Cash flows from investingactivities Acquisition of subsidiaries,net of cash acquired - (169) (169)Purchase of property,equipment and intangibleassets (1,273) (1,201) (2,249)Proceeds from sale ofproperty and equipment 29 63 211Purchase of investmentsecurities (528,050) (654,379) (1,495,420)Proceeds from sale andredemption of securities 566,801 632,376 1,422,139 --------- --------- ---------Net cash generated from/(usedin) investing activities 37,507 (23,310) (75,488) --------- --------- ---------Cash flows from financingactivities Repayments of debt securities (116) (561) (611)Purchase of shares for sharebased schemes (980) (866) (1,266)Issue of ordinary shares 1,023 200 745Dividends paid (6,942) (6,507) (10,780) --------- --------- ---------Net cash used in financingactivities (7,015) (7,734) (11,912) --------- --------- ---------Net increase/(decrease) incash and cash equivalents 110,015 23,822 (3,412)Cash and cash equivalents atbeginning of the period 160,798 164,413 164,413Effect of exchange ratechanges on cash and cashequivalents 134 (63) (203) --------- --------- ---------Cash and cash equivalents atthe end of the period (Note 7) 270,947 188,172 160,798 --------- --------- --------- CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSEfor the six months ended 30 June 2005 Unaudited Unaudited IFRS IFRS Unaudited Six months Six months IFRS ended ended Year ended 30 June 30 June 31 December 2005 2004 2004 £'000s £'000s £'000s------------------------------ ---------- ---------- ----------Profit after taxation 10,426 9,472 19,952 Exchange translationdifferences 36 (71) (109) Actuarial (loss)/gain onretirement benefitobligations (880) 990 (856) Revaluation of available-for-saleinvestment securities: -------- -------- --------- net (loss)/gain from changesin fair value (1,016) 454 2,177- net profit on disposaltransferred to incomeduring the period - - (759) -------- -------- -------- (1,016) 454 1,418 Deferred tax on equity items: -------- -------- --------- available-for-sale investment securities 305 (136) (425)- retained earnings 290 (173) 759 -------- -------- -------- 595 (309) 334 -------- -------- --------Recognised income andexpense for the period 9,161 10,536 20,739 -------- -------- -------- Attributable to:Equity holders of Company 9,161 10,536 20,739 -------- -------- -------- Notes to the consolidated financial statements 1. Basis of preparation 2005 interim financial information European Union ('EU') law requires that the next annual consolidated financialstatements of the Company, for the year ending 31 December 2005, be prepared inaccordance with International Financial Reporting Standards ('IFRS') adopted foruse in the EU ('adopted IFRS'). The 2005 interim financial information has been prepared on the basis of therecognition and measurement principles of IFRS that are endorsed by the EU andeffective (or available for early adoption) at 31 December 2005. The interiminformation also reflects standards that are expected to be endorsed andeffective (or available for early adoption) at 31 December 2005. Based on theseadopted and unadopted IFRS, the Directors have made assumptions about theaccounting policies expected to be applied when the first annual IFRS financialstatements are prepared for the year ending 31 December 2005. In particular, the Directors have assumed that International Accounting Standard19 'Employee benefits' issued by the International Accounting Standards Boardwill be adopted by the EU in sufficient time to be available for use in theannual IFRS financial statements for the year ending 31 December 2005. The accounting policies that the Directors assume will apply to the preparationof the first annual IFRS financial statements for the year ending 31 December2005 are set out in Appendix 3 of the announcement titled 'Transition toInternational Financial Reporting Standards' which was released on 4 August2005. However, the adopted IFRS that will be effective (or available for earlyadoption) in the annual financial statements for the year ending 31 December2005 are still subject to change and to additional interpretations and thereforecannot be determined with certainty. Accordingly, the accounting policies forthat annual period will be determined only when the annual financial statementsare prepared for the year ending 31 December 2005. 2004 comparative financial information The 2004 comparative financial information included in these interim accounts isprepared under the reporting basis for statutory comparatives under IFRS for the2004 financial year. In preparing the 2004 comparative information, the Grouphas adjusted amounts previously reported in financial statements under UKGenerally Accepted Accounting Principles ('GAAP'). The impact of the transitionfrom UK GAAP at 1 January 2004 and 31 December 2004 is set out and explained inthe announcement titled 'Transition to International Financial ReportingStandards' which was released on 4 August 2005 and is available on the Group'swebsite www.rathbones.com. The impact of the transition from UK GAAP to IFRS at30 June 2004 is shown in Note 9 of these interim accounts. 2. Section 240 statement The comparative figures for the financial year ended 31 December 2004 do notconstitute the Company's statutory accounts for that financial year within themeaning of section 240 of the Companies Act 1985. Those accounts, which wereprepared under UK GAAP, have been reported on by the Company's auditors anddelivered to the Registrar of Companies. The report of the auditors wasunqualified and did not contain statements under section 237(2) or (3) of theCompanies Act 1985. 3. Segmental information (a) Business segments For management purposes, the Group is currently organised into three operatingdivisions: Investment Management and Banking, Unit Trusts and Trust Services.These divisions are the basis on which the Group reports its primary segmentinformation. At 30 June 2005 Investment management and Unit Trust banking trusts services Eliminations Total £'000 £'000 £'000 £'000 £'000---------------- ---------- ------- -------- --------- ---------Externalrevenues 45,453 7,641 11,057 - 64,151Revenues fromother segments 695 - 1 (696) - -------- ------- -------- ------- ---------Total revenues 46,148 7,641 11,058 (696) 64,151 -------- ------- -------- ------- --------- Segment result 13,190 1,414 1,454 16,058 -------- ------- --------Unallocateditems (1,375) ---------Profit before tax 14,683Tax (4,257) ---------Profit for the period 10,426 --------- Segment assets 631,232 13,443 59,162 703,837 -------- ------- --------Unallocatedassets 16,398 ---------Total assets 720,235 --------- =========Segmentliabilities 557,351 10,866 22,656 590,873 -------- ------- --------Unallocatedliabilities 8,777 ---------Totalliabilities 599,650 --------- Other segment items:Capitalexpenditure 1,043 34 234 1,311Depreciationandamortisation 980 51 264 1,295Other non-cashexpenses 696 74 638 1,408 At 30 June 2004 Investment management Unit Trust and banking trusts services Eliminations Total £'000 £'000 £'000 £'000 £'000---------------- ---------- ------- -------- --------- --------Externalrevenues 38,028 4,819 10,949 - 53,796Revenues fromother segments 682 - - (682) - -------- ------- -------- ------- --------Total revenues 38,710 4,819 10,949 (682) 53,796 -------- ------- -------- ------- -------- Segment result 10,787 538 1,933 13,258 -------- ------- --------Unallocated items - --------Profit before tax 13,258Tax (3,786) --------Profit for the period 9,472 -------- Segment assets 505,706 17,055 57,978 580,739 -------- ------- -------- Unallocatedassets 16,703 --------Total assets 597,442 -------- Segmentliabilities 439,822 15,711 21,261 476,794 -------- ------- --------Unallocatedliabilities 9,867 --------Totalliabilities 486,661 -------- Other segment items:Capitalexpenditure 1,041 42 156 1,239Depreciation 943 57 278 1,278Other non-cashexpenses 460 49 277 786 At 31 December 2004 Investment management Unit Trust and banking trusts Services Eliminations Total £'000 £'000 £'000 £'000 £'000---------------- ---------- ------- -------- --------- ---------Externalrevenues 77,393 10,763 21,365 - 109,521Revenues fromother segments 1,367 - - (1,367) - -------- ------- -------- -------- --------- 78,760 10,763 21,365 (1,367) 109,521 -------- ------- -------- --------Unallocatedexternalrevenues 759 ---------Total revenues 110,280 --------- Segment result 22,197 1,340 3,283 26,820 -------- ------- --------Unallocateditems 1,672 ---------Profit before tax 28,492Tax (8,540) ---------Profit for theyear 19,952 --------- Segment assets 515,589 9,630 55,449 580,668 -------- ------- --------Unallocatedassets 24,689 ---------Total assets 605,357 --------- Segmentliabilities 447,518 8,365 21,625 477,508 -------- ------- --------Unallocatedliabilities 10,409 ---------Totalliabilities 487,917 --------- Other segment items:Capitalexpenditure 2,396 81 414 2,891Depreciation 1,946 115 568 2,629Other non-cashexpenses 916 99 314 1,329 (b) Geographical Segments The Group's operations are located in the United Kingdom, Jersey, Switzerlandand the British Virgin Islands. The following table provides an analysis of the Group's sales by geographicalmarket, by origin of the services: Revenue by geographical market Six months Six months Year ended ended 30 June ended 30 June 31 December 2005 2004 2004 £'000 £'000 £'000-------------------------- ---------- ---------- ----------United Kingdom 53,464 43,768 90,129Jersey 8,581 7,976 15,897Rest of the world 2,106 2,052 4,254 -------- -------- ------- 64,151 53,796 110,280 -------- -------- ------- The following is an analysis of the carrying amount of segment assets, andadditions to property, plant and equipment and intangible assets, analysed bythe geographical area in which the assets are located: Carrying amount of segment assets At 30 June At 30 June At 31 December 2005 2004 2004 £000 £000 £'000-------------------------- ---------- ---------- -----------United Kingdom 658,374 536,622 535,543Jersey 25,959 23,458 24,203Rest of the world 19,504 20,659 20,922 -------- ------- ------- 703,837 580,739 580,668 -------- ------- ------- Additions to property, plant and equipment and intangible assets Six months Six months Year ended ended 30 ended 30 31 December June June 2004 2005 2004 £'000 £'000 £'000--------------------------- ---------- ---------- ----------United Kingdom 1,135 1,155 2,606Jersey 151 14 172Rest of the world 25 70 113 ------- ------- ------- 1,311 1,239 2,891 ------- ------- ------- (c) Analysis of operating income Six months Six months Year ended ended ended 31 December 30 June 2005 30 June 2004 2004 £'000 £'000 £'000---------------------------- --------- --------- ---------Interest and similar income 13,180 9,517 20,759Fee and commission income 49,911 43,395 86,067Dividend income 15 12 915Net trading income 685 454 919Gains less losses frominvestment securities - - 759Other operating income 360 418 861 --------- --------- ---------Gross operating income 64,151 53,796 110,280Interest payable (7,141) (4,554) (10,477)Fees and commission expense (3,149) (1,984) (4,276) --------- --------- ---------Operating income 53,861 47,258 95,527 --------- --------- --------- 4. Aborted acquisition costs On 14 January 2005, the Company announced a pre-conditional offer for Rensburgplc ('Rensburg'). There were subsequently substantive discussions and exchangesof information with Rensburg, which led to a revised pre-conditional offerproposal being made on 23 February 2005 which was subsequently rejected by theboard of Rensburg. On 7 April 2005, the Company announced its decision not toproceed with making an offer. As reported in the 2004 financial statements, the Company incurred professionaladvisory costs in 2005 in relation to the above process and, as no offer wasmade, those costs amounting to £1,375,000 have been charged to the profit andloss account in the first six months of 2005. 5. Earnings per shareThe calculation of basic earnings per share ('EPS') is based on profit aftertaxation before dividends for each period and the weighted average number ofordinary shares outstanding during the relevant period. Diluted earnings per share is the basic earnings per share, adjusted for theeffect of contingently issuable shares under the Long Term Incentive Plan,employee share options remaining capable of exercise and any dilutive shares tobe issued under the Share Incentive Plan, weighted for the relevant period (seetable below). Six months Six months ended ended Year ended 30 June 30 June 31 December 2005 2004 2004---------------------------- --------- ---------- ----------Weighted average number of ordinaryshares outstandingduring the period - basic 40,944,800 40,688,447 40,729,520 Effect of ordinary shareoptions 177,882 370,666 333,709 Effect of dilutive ordinary sharesissuable under theShare Incentive Plan 96,914 15,005 174,606 Effect of contingently issuableordinary sharesunder the Long Term IncentivePlan 222,129 - 265,611 -------- -------- --------Weighted average number ofordinary shares outstandingduring the period - diluted 41,441,725 41,074,118 41,503,446 -------- -------- -------- 6. Dividend per share The interim dividend declared of 11.5p per share is payable on 14 October 2005to shareholders on the register at the close of business on 21 September 2005. 7. Cash and cash equivalents For the purposes of the cash flow statement, cash and cash equivalents comprisethe following balances with less than three months maturity from the date ofacquisition: Six months Six months Year ended ended 30 June ended 30 June 31 December 2005 2004 2004 £'000 £000 £'000--------------------------- ---------- ---------- ----------Cash and balances withcentral banks 306 302 15,840Loans and advances tobanks 117,634 39,870 52,881Held-to-maturity investmentsecurities 153,007 148,000 92,077 -------- -------- ------- 270,947 188,172 160,798 -------- -------- ------- 8. Reconciliation of changes in equity Called up Share Merger Available-for-sale Retained Total share premium reserve reserve earnings equity capital £'000 £'000 £'000 £'000 £'000 £'000 ------- ------- ------ ------- ------- -------Equity at 1January 2004 2,033 13,791 49,428 4,036 37,547 106,835 Profit for thesix monthsended 9,472 9,47230 June 2004Foreigncurrencytranslation (71) (71)Dividendrelating to2003 (final) (6,507) (6,507)Shares issued 3 197 200Actuarialgain/(loss) 990 990Revaluation ofinvestmentsecurities 454 454Share-basedpayments- value ofemployeeservices 583 583- cost ofsharesissued/purchased (866) (866)Tax on equityitems (136) (173) (309) ------- ------- ------ ------- ------- -------Equity at 30June 2004 2,036 13,988 49,428 4,354 40,975 110,781 Profit for thesix monthsended 31December 2004 10,480 10,480Foreigncurrencytranslation (38) (38)Dividendrelating to2004 (interim) (4,273) (4,273)Shares issued 7 778 785Actuarialgain/(loss) (1,846) (1,846)Revaluation ofinvestmentsecurities 964 964Share-basedpayments- value ofemployeeservices 584 584- cost ofsharesissued/purchased (640) (640)Tax on equityitems (289) 932 643 ------- ------- ------ ------- ------- -------Equity at 31December 2004 2,043 14,766 49,428 5,029 46,174 117,440 Profit for thesix monthsended 10,426 10,42630 June 2005Foreigncurrencytranslation 36 36Dividendrelating to2004 (final) (6,942) (6,942)Shares issued 11 1,454 1,465Actuarialprofit/(loss) (880) (880)Revaluation ofinvestmentsecurities (1,016) (1,016)Share-basedpayments- value ofemployeeservices 883 883- cost ofsharesissued/purchased (1,422) (1,422)Tax on equityitems 305 290 595 ------- ------- ------ ------- ------- -------Equity at 30June 2005 2,054 16,220 49,428 4,318 48,565 120,585 ------- ------- ------ ------- ------- ------- 9. Explanation of transition to IFRS (a) Effect of IFRS on the UK GAAP consolidated balance sheet as at 30 June 2004 UK GAAP Presentation Events Share- Employee Business 30.06.04 of Financial after based Benefits Combinations £'000 Statements Balance Payment (IAS 19) (IFRS 3) (IAS 1) Sheet Date (IFRS 2) £'000 £'000 £'000 (IAS 10) £'000 £'000 -------------------- --------- --------- --------- -------- -------- ---------Assets-------------------- --------- --------- --------- -------- -------- ---------Cash andbalances atcentral banks 302-------------------- --------- --------- --------- -------- -------- ---------Settlementbalances 36,473-------------------- --------- --------- --------- -------- -------- ---------Loans andadvances tobanks 39,870-------------------- --------- --------- --------- -------- -------- ---------Loans andadvances tocustomers 39,292-------------------- --------- --------- --------- -------- -------- ---------Debtsecurities 385,003 (385,003)-------------------- --------- --------- --------- -------- -------- ---------Investment securities-------------------- --------- --------- --------- -------- -------- ---------- available-for-sale 35-------------------- --------- --------- --------- -------- -------- ---------- held-to-maturity 385,003-------------------- --------- --------- --------- -------- -------- ---------Equity shares 35 (35)-------------------- --------- --------- --------- -------- -------- ---------Intangibleassets 54,754 2,962-------------------- --------- --------- --------- -------- -------- ---------Tangible fixedassets 6,036 (6,036)-------------------- --------- --------- --------- -------- -------- ---------Property,plant andequipment 6,036-------------------- --------- --------- --------- -------- -------- ---------Deferredincome taxasset 1,243-------------------- --------- --------- --------- -------- -------- ---------Prepayments,accrued incomeand otherassets 22,866 (1,243) (799)-------------------- --------- --------- --------- -------- -------- ---------Total assets 584,631 (799) 2,962-------------------- --------- --------- --------- -------- -------- ---------Liabilities-------------------- --------- --------- --------- -------- -------- ---------Deposits bybanks 4,695-------------------- --------- --------- --------- -------- -------- ---------Settlementbalances 42,528-------------------- --------- --------- --------- -------- -------- ---------Derivative financialinstruments --------- --------- --------- -------- -------- -----------------------------Due tocustomers 403,303-------------------- --------- --------- --------- -------- -------- ---------Debtsecurities inissue 336-------------------- --------- --------- --------- -------- -------- ---------Accruals,deferredincome,provisions andotherliabilities 25,686 (4,468) (4,276) (189)-------------------- --------- --------- --------- -------- -------- ---------Current taxliability 4,468-------------------- --------- --------- --------- -------- -------- ---------Retirementbenefitobligation 12,998-------------------- --------- --------- --------- -------- -------- ---------Totalliabilities 476,548 (4,276) (189) 12,998-------------------- --------- --------- --------- -------- -------- ---------Equity-------------------- --------- --------- --------- -------- -------- ---------Share capital 2,036-------------------- --------- --------- --------- -------- -------- ---------Share premium 13,988-------------------- --------- --------- --------- -------- -------- ---------Other reserves 49,428-------------------- --------- --------- --------- -------- -------- ---------Retainedearnings 42,631 4,276 189 (13,797) 2,962-------------------- --------- --------- --------- -------- -------- --------- - broughtforward 40,650 6,507 167 (14,686)-------------------- --------- --------- --------- -------- -------- --------- - currencyadjustments (71)-------------------- --------- --------- --------- -------- -------- ---------- share basedpayments (114) (169)-------------------- --------- --------- --------- -------- -------- ---------- dividendpaid/declared (4,276) (2,231)-------------------- --------- --------- --------- -------- -------- ---------- actuarialgains/losses 990-------------------- --------- --------- --------- -------- -------- ---------- revaluation of AVSsecurities --------- --------- --------- -------- -------- ------------------------------ profit forthe period 6,442 191 (101) 2,962-------------------- --------- --------- --------- -------- -------- ---------Total equity 108,083 4,276 189 (13,797) 2,962-------------------- --------- --------- --------- -------- -------- --------- Total equityandliabilities 584,631 - - (799) 2,962-------------------- --------- --------- --------- -------- -------- --------- Financial Intangible Revenue Other Income Unaudited Instruments Assets (IAS 18) £'000 Taxes IFRS (IAS 39) (IAS 38) £'000 (IAS 12) 30.06.04 £'000 £'000 £'000 £'000-------------------- --------- -------- --------- -------- -------- ---------Assets-------------------- --------- -------- --------- -------- -------- ---------Cash andbalances atcentral banks 302-------------------- --------- -------- --------- -------- -------- ---------Settlementbalances 36,473-------------------- --------- -------- --------- -------- -------- ---------Loans andadvances tobanks 39,870-------------------- --------- -------- --------- -------- -------- ---------Loans andadvances tocustomers 39,292-------------------- --------- -------- --------- -------- -------- ---------Debt securities-------------------- --------- -------- --------- -------- -------- ---------Investment securities-------------------- --------- -------- --------- -------- -------- ---------- available-for-sale 6,220 6,255-------------------- --------- -------- --------- -------- -------- ---------- held-to-maturity 385,003-------------------- --------- -------- --------- -------- -------- ---------Equity shares-------------------- --------- -------- --------- -------- -------- ---------Intangibleassets 1,623 639 59,978-------------------- --------- -------- --------- -------- -------- ---------Tangible fixed assets-------------------- --------- -------- --------- -------- -------- ---------Property,plant andequipment (1,309) 4,727-------------------- --------- -------- --------- -------- -------- ---------Deferredincome taxasset 2,429 3,672-------------------- --------- -------- --------- -------- -------- ---------Prepayments,accrued incomeand otherassets 732 314 21,870-------------------- --------- -------- --------- -------- -------- ---------Total assets 6,220 314 732 953 2,429 597,442-------------------- --------- -------- --------- -------- -------- ---------Liabilities-------------------- --------- -------- --------- -------- -------- ---------Deposits bybanks 4,695-------------------- --------- -------- --------- -------- -------- ---------Settlementbalances 42,528-------------------- --------- -------- --------- -------- -------- ---------Derivativefinancialinstruments 13 13-------------------- --------- -------- --------- -------- -------- ---------Due tocustomers 403,303-------------------- --------- -------- --------- -------- -------- ---------Debtsecurities inissue 336-------------------- --------- -------- --------- -------- -------- ---------Accruals,deferredincome,provisions andotherliabilities 820 695 18,268-------------------- --------- -------- --------- -------- -------- ---------Current taxliability 52 4,520-------------------- --------- -------- --------- -------- -------- ---------Retirementbenefitobligation 12,998-------------------- --------- -------- --------- -------- -------- ---------Totalliabilities 13 820 695 52 486,661-------------------- --------- -------- --------- -------- -------- ---------Equity-------------------- --------- -------- --------- -------- -------- ---------Share capital 2,036-------------------- --------- -------- --------- -------- -------- ---------Share premium 13,988-------------------- --------- -------- --------- -------- -------- ---------Other reserves 6,220 (1,866) 53,782Related Shares:
Rathbone