1st May 2007 07:03
Aberdeen Asset Management PLC01 May 2007 ABERDEEN ASSET MANAGEMENT PLC Interim Results for six months to 31 March 2007 Operational highlights • Assets under management £80.4 billion, up 9.8% from year-end • Record half-year net new business of £7.6 billion • Continued diversification of new business • Fund management operating margin 30% (2006 - 28.6%) • Migration of DeAM funds completed successfully Financial highlights March 2007 March 2006 (as restated)Revenue £162.5m £147.4m -------------------Pre-tax profit (loss)(before exceptional items* & amortisation of intangibles) £43.6m £36.8m(after exceptional items* & amortisation of intangibles) (£21.9m) £21.5m Diluted earnings (loss) per share (before exceptional items* & amortisation of intangibles) 5.07p 4.10p(after exceptional items* & amortisation of intangibles) (2.73p) 2.09p Dividend per share 2.60p 2.00pNet new business - funded £4.1bn £2.6bn - awarded but not yet funded £3.5bn £1.0bn * - exceptional items consist of gains on disposal of investments, integration costs, settlement costs and finance costs as shown in note 14. Commenting on the results, Martin Gilbert, Chief Executive of Aberdeen AssetManagement said: "We are very pleased to once again be able to report record net new business inflows. We are winning new mandates across all our areas ofactivity thanks to our strong investment philosophy and performance. Inaddition, tight financial management has enabled us to increase operatingmargins throughout the group. Looking ahead our strategy remains clear. We aim to offer a broad range of quality specialist investment products in equities, fixed income and property in the UK, Europe, the Middle East, Asia, Australia and the US. As a group, Aberdeen is increasingly diverse in terms of its geography, products and its highly talented staff. Looking ahead, this greater breadth and scale gives us considerable confidence in the future, whatever may occur in global financial markets." For further information, please contact: Aberdeen Asset Management PLCMartin Gilbert, Chief Executive 020 7463 6000 MaitlandNeil Bennett / Tom Siveyer 020 7379 5151 Assets under Management March September March 2007 2006 2006 £m £m £mInstitutional funds 62,623 56,444 56,194Open-end funds 11,918 10,835 11,826Closed-end funds 5,426 5,382 5,587Other 447 509 758 ---------------------------- 80,414 73,170 74,365 ----------------------------Equities : UK 12,128 10,111 11,255 European 2,212 1,787 2,173 USA 1,848 1,659 1,827 Asia Pacific 14,663 12,738 12,719 Japan 1,407 1,184 1,455 Emerging markets 1,537 977 946 ---------------------------- 33,795 28,456 30,375Fixed interest & cash 38,926 38,126 37,479Property 7,693 6,588 6,511 ---------------------------- 80,414 73,170 74,365 ---------------------------- Chairman's Statement The Group has enjoyed another successful period of organic growth in the six months to 31 March 2007, with record levels of new business wins and period-endassets under management ("AUM") of £80.4 billion showing a 9.8% increase on theprevious year end. Profit before taxation, stated before exceptional items and amortisation of intangibles, was £43.6 million, compared to £36.8 million for the equivalent period in 2006. This represents underlying earnings per share, on a diluted basis, of 5.1p, an increase of 24% on the 2006 figure of 4.1p. The Board has therefore decided to pay an interim dividend of 2.6p per share (2006 - 2.0p). Revenues generated in the period to 31 March 2007 increased by 10.2% compared to the equivalent period in 2006, whilst operating expenses have increased at only 7.7% over the same period. As a result, the Group's operating profit hasincreased by 27.4% to £46.5 million. Operating margins have also improved, withthe overall Group margin increasing from 26.2% for the year to 30 September 2006to 28.0% for the period under review. The investment management division hasincreased its operating margin from 28.6% to 30.0%, while the margin in theproperty division has improved from 16.4% to 19.9%. Global stock and bond markets have experienced some volatility during the periodbut the discipline of our philosophy and process have served to ensure that ourinvestment teams have not been distracted from their focus on identifying and investing in quality stocks. Performance has therefore remained very solid and this, combined with the relationships built by our client facing teams, is key to our success in attracting new business. As in previous periods, we have been successful in attracting new assets which are well diversified, both in terms of investment mandate and investor domicile.Our equities, fixed income and property teams have each generated healthy inflows, as summarised below. In particular, we are encouraged by the early contribution to these inflows by our recently opened offices in Frankfurt and Tokyo. We have also been successful in mitigating the ongoing erosion of multi-asset mandates that we anticipated following the acquisition of the Deutsche Asset Management ("DeAM") business in 2005 by converting a number of these mandates into specialist mandates. Gross new business of £10.8 billion was generated in the period and included inAUM at 31 March 2007, with a further £3.5 billion of mandates awarded or committed before the period end but not funded at that date. It is encouragingto note that these flows include both new clients and additional amounts committed by existing clients. Net new business for the period is summarised in the following table: Funded in Yet to Net new period fund business £m £m £mEquities and multi-asset Segregated mandates 954 906 1,860Funds 101 - 101 --------------------------- 1,055 906 1,961 ---------------------------Fixed income Segregated mandates 2,229 1,606 3,835Funds 252 - 252 --------------------------- 2,481 1,606 4,087 ---------------------------Property Segregated mandates (756) - (756)Funds 1,321 1,025 2,346 --------------------------- 565 1,025 1,590 ---------------------------Group total 4,101 3,537 7,638 --------------------------- These new business inflows have been the major contributor to the growth in theGroup's AUM to £80.4 billion at 31 March. This represents a 9.8% increase on the position at 30 September 2006, the increase being generated as follows: £bn At 30 September 2006 73.2 Net new business funded in the period 4.1 +5.6%Market appreciation and performance 2.8 +3.8%Net movements from corporate acquisitions 0.3 +0.4% -------------- At 31 March 2007 80.4 +9.8% -------------- During the period to 31 March 2007 we have successfully completed the final phase of the migration of the DeAM funds to our third party administrator's systems. This brings to an end what has been a huge technical and logistical exercise and we are again able to operate on a single back office structure. During the period, we reached agreement with Real Estate Opportunities Limited ("REO") to settle Aberdeen's part in the legal action initiated by REO in 2005 against Aberdeen and others. Whilst we have made no admission whatsoever of anyliability or of acceptance of the validity of REO's claim, we recognised that it was in the best interests of the Group and its shareholders to conclude thismatter and to end the distraction it has caused. We recently announced the proposed acquisition of certain businesses from Deutsche Asset Management Australia and we expect this transaction to be completed by 1 July. This infill acquisition will add further expertise to our global fixed income capability and improve our overall profile in the Australian institutional market and we will seek to build on this in future periods. We also continue to expand the scope and balance of our property activities and have recruited a small team to build our capability in the UK property sector. We believe we remain well positioned to continue the Group's progress in the second half of the current financial year and beyond. C L A Irby 1 May 2007 Group Income Statement For the six months to 31 March 2007 6 mths to 6 mths to Year to 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) Notes £'000 £'000 £'000 Revenue 3 162,486 147,438 302,124 ---------------------------- Operating costs (119,439) (110,917) (228,792)Exceptional integration costs 4 (18,936) (17,237) (33,282)Amortisation of intangible assets (4,500) (5,462) (8,958)Exceptional settlement costs 5 (50,000) - (236) ----------------------------Operating expenses (192,875) (133,616) (271,268) ---------------------------- Exceptional gains on investments 7,892 8,238 18,381Gains on investments and other income 3,482 - 7,925 ---------------------------Other operating income 6 11,374 8,238 26,306 --------------------------- Operating profit before: 46,529 36,521 81,257Exceptional gains and charges (61,044) (8,999) (15,137)Amortisation of intangible assets (4,500) (5,462) (8,958) ---------------------------Operating (loss) profit (19,015) 22,060 57,162 --------------------------- Finance revenue 5,890 1,813 11,608Finance costs (8,805) (1,539) (13,823)Exceptional finance costs - (800) (1,100) --------------------------Net finance costs (2,915) (526) (3,315) -------------------------- Profit before exceptional items, amortisation and taxation 43,614 36,795 79,042Exceptional items and amortisation before taxation (65,544) (15,261) (25,195) ---------------------------(Loss) profit before taxation (21,930) 21,534 53,847 --------------------------- Tax expense before exceptional items and amortisation (8,006) (8,901) (17,404)Tax credit on exceptional items 16,213 2,700 7,429 ---------------------------Tax credit (expense) 8,207 (6,201) (9,975) --------------------------- (Loss) profit for the period, attributable to equity shareholders (13,723) 15,333 43,872 --------------------------- Memo - dividends paid during the period 14,979 9,899 28,110 --------------------------- (Loss) earnings per share Basic 14 (2.73p) 2.11p 6.41pDiluted 14 (2.73p) 2.09p 6.27p Underlying earnings per share Basic 14 5.47p 4.20p 9.37pDiluted 14 5.07p 4.10p 8.83pDividend per share 2.60p 2.00p 4.40pAll items dealt with in arriving at the profits stated above relate to continuing operations Group Statement of Recognised Income and Expense For the six months to 31 March 2007 6 mths to 6 mths to Year to 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) Notes £'000 £'000 £'000 Net actuarial loss on defined benefit pension schemes - - (6,835)Translation of foreign currency net investments 183 191 (5,882)Movement in fair value of available for sale investments (6,930) 1,043 7,365Tax on items taken directly to equity - (158) 2,324 --------------------------Net income (expense) recognised directly in equity 12 (6,747) 1,076 (3,028)(Loss) profit for the financial period (13,723) 15,333 43,872 ---------------------------Total recognised income and expense for the period, attributable to equity shareholders (20,470) 16,409 40,844 --------------------------- Group Balance Sheet As at 31 March 2007 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) Notes £'000 £'000 £'000ASSETS Non-current assets Intangible assets 8 547,168 548,011 553,565Property, plant and equipment 11,246 7,364 9,351Other investments 9 19,343 15,561 13,818Deferred tax assets 28,424 8,932 11,022Other receivables 3,302 - 1,038 ----------------------------Total non-current assets 609,483 579,868 588,794 ---------------------------- Current assets Stock of units and shares 10 679 2,262 264Other financial investments 11 1,328,924 1,634,007 1,412,579Trade and other receivables 152,659 168,011 132,635Other investments 9 26,391 27,571 33,541Cash and cash equivalents 56,937 25,104 50,497Assets classified as available for sale - - 7,000 ------------------------------Total current assets 1,565,590 1,856,955 1,636,516 ------------------------------Total assets 2,175,073 2,436,823 2,225,310 ------------------------------Equity Called up share capital 70,812 70,547 70,605Share premium account 287,226 290,573 286,277Other reserves 217,767 220,974 224,514Retained loss (156,069) (136,667) (131,301) -----------------------------Total equity attributable to equity holders of the parent 12 419,736 445,427 450,095 -----------------------------Liabilities Non-current liabilities Interest bearing loans and borrowings 13 121,936 24,512 90,192Other creditors 1,843 - 1,998Provisions 16 500 - 500Pension deficit 17 30,737 28,437 32,255Deferred tax liabilities 25,565 4,866 24,380 ----------------------------Total non-current liabilities 180,581 57,815 149,325 ----------------------------Current liabilities Investment contract liabilities 11 1,328,924 1,634,007 1,412,579Interest bearing loans and borrowings 13 59,899 22,867 50,551Trade and other payables 162,744 243,258 143,849Employee benefits 1,631 1,377 -Provisions 16 1,775 18,463 2,109Deferred income 2,351 2,876 2,188Current tax payable 17,432 10,733 14,614 ------------------------------Total current liabilities 1,574,756 1,933,581 1,625,890 ------------------------------Total liabilities 1,755,337 1,991,396 1,775,215 ------------------------------Total equity and liabilities 2,175,073 2,436,823 2,225,310 ------------------------------ Summary Group Cash Flow Statement For the six months to 31 March 2007 6 mths to 6 mths to Year to 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) Notes £'000 £'000 £'000 Core cashflow from operating activities 19,269 9,924 45,886Effects of short-term timing differences on unit trust settlements (4,791) (2,149) 6,681 --------------------------- 14,478 7,775 52,567Split capital settlement costs paid (334) (6,446) (15,836)Other exceptional integration and settlementcosts paid (37,867) (12,018) (33,282) ----------------------------Net cash (used in) from operating activities 7 (23,723) (10,689) 3,449 ---------------------------- Cash flows from investing activities Proceeds from sale of investments 21,646 28,393 73,451Proceeds from sale of property, plant and equipment - 21 173Disposal of subsidiaries, net of cash disposed of 1,500 2,124 4,824Disposal of private client business - - 2,946Acquisition of subsidiaries, net of cash acquired - (45,006) (71,441)Acquisition of intangible assets (960) (65,672) (74,934)Acquisition of property, plant & equipment (3,091) (1,993) (3,619)Acquisition of investments (16,058) (2,943) (43,913) ----------------------------Net cash from (used in) investing activities 3,037 (85,076) (112,513) ---------------------------- Cash flows from financing activities Issue of ordinary share capital 1,156 602 870Issue of preference share capital - - 3Issue of subordinated loan notes - - 66,153Purchase of own shares - - (3,024)New borrowings 68,487 33,000 25,000Repayment of convertible bonds (24,997) - -Repayment of borrowings (3) (98) (475)Dividends paid (14,979) (9,899) (28,110) ---------------------------Net cash from financing activities 29,664 23,605 60,417 ---------------------------Net increase (decrease) in cash and cash equivalents 8,978 (72,160) (48,647)Cash and cash equivalents at 1 October 48,120 97,016 97,016Effect of exchange rate fluctuations on cash held (161) 248 (249) ---------------------------Cash and cash equivalents at end of period 56,937 25,104 48,120 --------------------------- Notes 1. Basis of preparation The financial information contained in these interim financial statements has been prepared in accordance with International Financial Reporting Standards, as adopted in the EU ('IFRS'), and its interpretations adopted by the International Accounting Standards Board (IASB) or the International Financial Reporting Interpretations Committee or their predecessors ('IFRIC'), which has been approved by the European Commission as at 31 March 2007. At 31 March 2006 the Group's interpretation of IAS 27 Consolidated and SeparateFinancial Statements resulted in the consolidation of certain companies where the Group's private equity business was deemed to have controlling interest. At 30 September 2006 the Group reviewed its interpretation of the standard and concluded that there was no requirement under IAS 27 to consolidate these companies. Comparative financial information for 31 March 2006 has therefore been restated, where necessary, to exclude the consolidation of these companies. The impact of excluding these companies has increased the profit forthe period, attributable to equity shareholders, by £334,000 and increased equity attributable to equity holders of the parent by £2,041,000. The interim results have not been audited but have been reviewed by the auditors. The comparative figures for the financial year ended 30 September 2006 are not the company's statutory accounts for that financial year. Those accounts have been reported on by the company's auditors and delivered to the Registrar of Companies. The report of the auditors was (i) unqualified (ii) didnot include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 237(2) or (3) of the Companies Act 1985. 2. Interim dividend The interim ordinary dividend of 2.6p per share will be paid on 13 June 2007 to qualifying shareholders on the register at 11 May 2007. 3. Segmental information Segment information is presented in respect of the Group's business segments. The primary business segments, based on the Group's management and reporting structure, are the investment management division and the property management division. The results, analysed by these two business segments, are shown below. Property Investment asset Group management management totalSix months to 31 March 2007 £'000 £'000 £'000 Turnover 128,926 32,867 161,793Net fair value gains on assets at fair value through income 693 - 693 ----------------------------Revenue 129,619 32,867 162,486 ---------------------------- Operating costs (93,126) (26,313) (119,439)Integration costs (18,936) - (18,936)Amortisation of intangible assets (excluding software) (4,500) - (4,500)Exceptional settlement costs (50,000) - (50,000) ----------------------------Operating expenses (166,562) (26,313) (192,875) ----------------------------Exceptional gains on investments 7,892 - 7,892Gains on investments and other income 3,482 - 3,482 ---------------------------Other operating income 11,374 - 11,374 --------------------------- Operating profit (before exceptional items and amortisation of intangibles) 39,975 6,554 46,529 ---------------------------Operating (loss) profit (after exceptional itemsand amortisation of intangibles) (25,569) 6,554 (19,015) --------------------------- Property Investment asset Group management management total (as (as (as restated) restated) restated)Six months to 31 March 2006 £'000 £'000 £'000 Turnover 119,203 28,060 147,263Net fair value gains on assets at fair value through income 175 - 175 ----------------------------Revenue 119,378 28,060 147,438 ---------------------------- Operating costs (86,957) (23,960) (110,917)Integration costs (17,237) - (17,237)Amortisation of intangible assets (excluding software) (5,462) - (5,462) ----------------------------Operating expenses (109,656) (23,960) (133,616) ---------------------------- Exceptional gains on investments 8,238 - 8,238 --------------------------Other operating income 8,238 - 8,238 -------------------------- Operating profit (before exceptional items and amortisation of intangibles) 32,421 4,100 36,521 ---------------------------Operating profit (after exceptional items and amortisation of intangibles) 17,960 4,100 22,060 --------------------------- Property Investment asset Group management management totalYear to 30 September 2006 £'000 £'000 £'000 Turnover 240,105 60,202 300,307Net fair value gains on assets at fair value through income 1,817 - 1,817 ----------------------------Revenue 241,922 60,202 302,124 ---------------------------- Operating costs (177,241) (51,551) (228,792)Integration costs (33,282) - (33,282)Amortisation of intangible assets (excluding software) (8,958) - (8,958)Exceptional charge (236) - (236) -----------------------------Operating expenses (219,717) (51,551) (271,268) ----------------------------- Exceptional gains on investments 18,381 - 18,381Gains on investments and other income 6,429 1,496 7,925 ---------------------------Other operating income 24,810 1,496 26,306 ---------------------------Operating profit (before exceptional items and amortisation of intangibles) 71,110 10,147 81,257 ---------------------------Operating profit (after exceptional items and amortisation of intangibles) 47,015 10,147 57,162 --------------------------- 4. Exceptional integration costs On 30 September 2005 the Company completed the acquisition of certain fund management businesses of Deutsche Bank AG. These businesses consisted of the London fixed interest business, the OEIC business and the equities and multi-asset business. On 1 December 2005 the second and final stage of the acquisition was completed when the Philadelphia fixed income business was acquired. During the period since acquisition substantial integration costs have been incurred in combining these acquired businesses with the existing businesses of the Group. These integration costs comprise charges in respect ofa transitional services agreement with the vendor to ensure that both people and systems are transferred in a controlled manner; set up costs in respect ofthe migration of the back office data and systems to the Group's third party administrator; and costs of retaining duplicate staffing for a transitional period to ensure a smooth migration of data. 6 mths to 6 mths to Year to 31 Mar 31 Mar 30 Sept 2007 2006 2006 £'000 £'000 £'000 Transitional service costs from vendor 10,245 8,427 11,190Set-up costs in respect of back office data and systems 2,401 2,636 7,579Duplicate staff costs, redundancy costs and third party integration costs 6,290 6,174 12,130Staff retention costs - - 2,383 --------------------------- 18,936 17,237 33,282 --------------------------- 5. Exceptional settlement costs 6 mths to 6 mths to Year to 31 Mar 31 Mar 30 Sept 2007 2006 2006 £'000 £'000 £'000 Recognised within operating profit Settlement of legal action initiated by Real Estate Opportunities 57,500 - -(Release of payment) payment made in relation to defence of proceedings by Real Estate Opportunities (7,500) - 7,500Release of provision for Uplift Plan to eligible investors in Aberdeen Progressive Unit Trust - - (7,264) ------------------------------- 50,000 - 236 ------------------------------- On 16 March 2007 the Company announced that it had reached agreement with Real Estate Opportunities Limited ('REO') to settle the Company's part in the legal action initiated in 2005 by REO against the Company and another party. The Company made no admission whatsoever of any liability or acceptance of the validity of REO's claim, but the Board recognised that it was in the interests of the Group and its shareholders to conclude this matter and to end the distraction it was causing to the Company. The net cost to the Group, includingthe Group's legal costs and after return of the defence payment of £7,500,000 made last year, was £50,000,000. 6. Other operating income Other operating income for the six months to 31 March 2007 comprises an exceptional gain of £7.9 million following the receipt of contingent deferred consideration in respect of the sale, in January 2005, of the Group's investment in Lombard International Assurance SA. The gain includes the transfer of £7 million from the available for sale reserve. The balance of other operating income comprise gains on the disposal of private equity investments. Other operating income for the six months to 31 March 2006 principally consistsof the gain realised on the disposal of the Group's investment in New Star Asset Management PLC which had been stated at a cost of £6 million. This shareholding was sold on 11 November 2005 following the listing of this company's shares on the Alternative Investment Market. The net proceeds from the sale were £14.6 million. Other operating income in prior periods representsgains on disposal of investments and subsidiaries. 7. Reconciliation of profit after tax to operating cash flow 6 mths to 6 mths to Year to 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) £'000 £'000 £'000 (Loss) profit after tax (13,723) 15,333 43,872 Depreciation charge 1,196 1,134 2,294Amortisation of intangible assets 4,500 5,462 8,958Amortisation of intangible software assets 358 467 889Fair value adjustment to investments (693) (175) (1,817)Gain on disposal of investments (3,482) (8,825) (20,224)Share based element of remuneration 3,934 3,177 6,163Net finance costs 2,915 526 3,315Income tax (credit) expense (8,207) 6,201 9,975 -------------------------- (13,202) 23,300 53,425Decrease in provisions (1,852) (8,043) (26,752)(Increase) decrease in stock (415) 112 2,110(Increase) decrease in trade and other receivables (21,010) (17,043) 13,703Increase (decrease) in trade and other payables 20,904 (7,830) (32,037) ---------------------------Net cash (outflow) inflow from operating activities (15,575) (9,504) 10,449Net finance costs (paid) received (2,895) 676 (334)Corporation tax paid (5,253) (1,861) (6,666) ---------------------------Net cash (used in) from operating activities (23,723) (10,689) 3,449 --------------------------- 8. Intangible assets 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) £'000 £'000 £'000 Intangible assets 147,307 147,173 153,303Goodwill 399,861 400,838 400,262 ---------------------------- 547,168 548,011 553,565 ---------------------------- 9. Other investments 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) £'000 £'000 £'000 Non-current assets Non-current investments held by group companies 19,343 15,561 13,818 --------------------------- Current assets Liquid investments of life and pensions subsidiary 12,841 19,951 22,761Other short-term investments 13,550 7,620 10,780 --------------------------- 26,391 27,571 33,541 --------------------------- 10. Stock of units and shares 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) £'000 £'000 £'000 Units and shares in managed funds 679 2,262 264 ------------------------ 11. Other financial investments / investment contract liabilities These balances represent unit linked business carried out by the Group's life and pensions subsidiary. The assets represent investments held to meet contracted liabilities. 12. Statement of changes in equity 6 mths to 6 mths to Year to 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) £'000 £'000 £'000 (Loss) profit for the period (13,723) 15,333 43,872Other recognised income and expense (6,747) 1,076 (3,028)Dividends paid (14,979) (9,899) (28,110)Issue of ordinary share capital 1,156 684 27,325Issue of LTIP shares - - (26,452)Share based payments 3,934 3,177 6,163Fair value release on disposal - - (5,995)Purchase of own shares - - (3,024) ---------------------------Net (deductions from) additions to shareholders' funds (30,359) 10,371 10,751Opening shareholders' funds 450,095 435,056 439,344 ----------------------------Closing shareholders' funds 419,736 445,427 450,095 ---------------------------- 13. Interest bearing loans and borrowings 31 Mar 31 Mar 30 Sept 2007 2006 2006 (as restated) £'000 £'000 £'000 Non-current liabilities Amount drawn under bank revolving credit facility 34,600 - -7.2% Subordinated notes 2016 63,031 - 66,1724.5% Convertible bonds 2010 24,305 23,921 24,020Unsecured guaranteed loan notes 2003 - 2008 - 591 - ---------------------------- 121,936 24,512 90,192 ----------------------------Current liabilities Amount drawn under bank revolving credit facility 58,887 - 25,000Bank overdraft - - 2,3775.875% Convertible bonds 2007 - 22,066 22,159Unsecured guaranteed loan notes 2003 - 2008 1,012 801 1,015 --------------------------- 59,899 22,867 50,551 --------------------------- 14. Earnings per share The calculations of earnings per share are based on the following profits and numbers of shares. Basic earnings per share amounts are calculated by dividing net profit for the period attributable to ordinary shareholders of the parent by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share amounts are calculated by dividing the net profit for the period attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year plus the weighted averagenumber of ordinary shares that would be issued on the conversion of all the potentially dilutive shares into ordinary shares. Underlying earnings per share figures are calculated by adjusting the net profit to exclude exceptional items and amortisation of intangible assets. The purpose of providing the underlying earnings per share is to allow readers of the accounts to clearly consider trends without the impact of exceptional and non-cash items. IAS 33 Underlying ------------------------- ----------------------------- 6 mths to 6 mths to Year to 6 mths to 6 mths to Year to 31 Mar 31 Mar 30 Sept 31 Mar 31 Mar 30 Sept 2007 2006 2006 2007 2006 2006 (as (as restated) restated) £'000 £'000 £'000 £'000 £'000 £'000 Basic earnings per share (Loss) profit for the financial period (13,723) 15,333 43,872 (13,723) 15,333 43,872Dividends on redeemablepreference shares (2,697) (2,700) (5,397) (2,697) (2,700) (5,397) --------------------------------------------------------(Loss) profit for the financial period, attributable to ordinary shareholders (16,420) 12,633 38,475 (16,420) 12,633 38,475 -------------------------Amortisation of intangible assets 4,500 5,462 8,070Exceptional gains on disposal of investments, net of attributabletaxation (7,892) (5,767) (14,867)Exceptional integration costs, net of attributable taxation 14,482 12,066 23,298Exceptional settlement costs, netof attributable taxation 38,241 - 165Non-recurring finance costs, net of attributable taxation - 800 1,100 --------------------------Profit for the financial period - underlying basis 32,911 25,194 56,241 --------------------------Weighted average number of shares 601,740 599,722 600,085 601,740 599,722 600,085 --------------------------------------------------------Basic (loss) earnings per share (2.73p) 2.11p 6.41p 5.47p 4.20p 9.37p -------------------------------------------------------- Diluted earnings per share (Loss) profit for calculation of basic earnings per share, as above (16,420) 12,633 38,475 32,911 25,194 56,241Add: interest on 2010 convertible bonds, net of attributable taxation N/A 419 837 419 419 837Add: dividend on convertible preference share units N/A N/A N/A 2,697 - 5,397 -------------------------------------------------------(Loss) profit for calculation of diluted earnings per share (16,420) 13,052 39,312 36,027 25,613 62,475 ------------------------------------------------------- Weighted average number of shares For basic earnings per share 601,740 599,722 600,085 601,740 599,722 600,085Dilutive effect of 2010 convertible bonds N/A 24,737 24,737 24,737 24,737 24,737Dilutive effect of convertible preference share units N/A N/A N/A 80,733 - 80,733Dilutive effect of exercisable share options N/A 519 2,282 3,762 519 2,282 -------------------------------------------------------- 601,740 624,978 627,104 710,972 624,978 707,837 --------------------------------------------------------Diluted (loss) earningsper share (2.73p) 2.09p 6.27p 5.07p 4.10p 8.83p -------------------------------------------------------- 15. Analysis of changes in net debt Other At Cash non cash Exchange At 30 Sept Flow changes Movement 31 Mar 2006 2007 £'000 £'000 £'000 £'000 £'000 Cash at bank and in hand 50,497 6,601 - (161) 56,937Bank overdraft (2,377) 2,377 - - - -------------------------------------------- 48,120 8,978 - (161) 56,937 --------------------------------------------- Debt due within one year (26,015) (33,884) - - (59,899)Convertible debt due within one year (22,159) 24,997 (2,838) - -Debt due after more than one year (66,172) (34,600) - - (100,772)Convertible debt due after more than one year (24,020) - (330) 3,186 (21,164) ---------------------------------------------- (138,366) (43,487) (3,168) 3,186 (181,835) ----------------------------------------------Total (90,246) (34,509) (3,168) 3,025 (124,898) --------------------------------------------- Net gearing 29.8% ----16. Provisions Provision Long-term for Uplift Business Plan Provision Total £'000 £'000 £'000 At 1 October 2006 - non-current liabilities - 500 500 - current liabilities 2,109 - 2,109 ------------------------- 2,109 500 2,609Utilised (334) - (334) -------------------------At 31 March 2007 1,775 500 2,275 -------------------------Non-current - 500 500Current 1,775 - 1,775 ------------------------- 1,775 500 2,275 ------------------------- The provision for Uplift Plan represents the provision made for eligible investors in Aberdeen Progressive Growth Unit Trust. The amount utilised represents the final payments made to investors in October 2006 under the provisions of the Uplift Plan. The balance of the provision at 31 March 2007 isbeing held to cover any further payments to investors in this fund. 17. Pension deficit The Group's principal form of pension provision is by way of three defined contribution schemes operated world-wide. The Group also operates three legacy defined benefit schemes in the UK: the CGA Staff Pension Fund, the Murray Johnstone Limited Retirement Benefits Plan and the Edinburgh Fund Managers Group plc Retirement & Death Benefits Plan. All three defined benefit schemes are closed to new membership and to future service accrual. The actuarial valuations of the defined benefit pension schemes referred to above were updated to 30 September 2006 by the respective independent actuariesusing the projected unit method. Contributions to the schemes since 30 September 2006 have been set off against the scheme deficits. 31 Mar 31 Mar 30 Sept 2007 2006 2006 £'000 £'000 £'000 Combined pension scheme deficits 30,737 28,437 32,255 -------------------------- 18. Copies of this statement are being sent to all shareholders. Copies can be obtained from the Company's registered office, 10 Queen's Terrace, Aberdeen, AB10 1YG. Independent Review Report to Aberdeen Asset Management PLC Introduction We have been instructed by the company to review the financial information for the six months ended 31 March 2007 which comprises the Consolidated Income Statement, Consolidated Statement of Recognised Income and Expense, Consolidated Balance Sheet, Consolidated Cash Flow Statement and Related Notes.We have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. This report is made solely to the company in accordance with the terms of our engagement to assist the company in meeting the requirements of the Listing Rules of the Financial Services Authority. Our review has been undertaken so that we might state to the company those matters we are required to state to itin this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the companyfor our review work, for this report, or for the conclusions we have reached. Directors' responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim report in accordance with the ListingRules of the Financial Services Authority which require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual accounts except where any changes, and the reasons for them, are disclosed. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4: Review of interim financial information issued by the Auditing Practices Board for use in the UK. A review consists principally of making enquiries of group management and applying analytical procedures to the financial information and underlying financial data and, based thereon, assessing whetherthe accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with International Standards on Auditing (UK and Ireland) and therefore provides a lower level of assurance than an audit. Accordingly, we do not express an auditopinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the six months ended 31 March 2007. KPMG Audit Plc Chartered Accountants Aberdeen 1 May 2007 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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