19th Feb 2008 07:00
Mattioli Woods PLC19 February 2008 Press Release 19 February 2008 Mattioli Woods plc ("Mattioli Woods" or "the Group") Interim Results Mattioli Woods plc (AIM: MTW.L), the specialist pensions consultancy, reportsits Interim Results for the six months ended 30 November 2007. Financial highlights• Turnover up 22.1% to £5.30m (1H07: £4.34m)• PBT up 15.8% to £1.83m (1H07: £1.58m)• EPS up 15.9% to 7.3p (1H07: 6.3p)• Interim dividend up 17.6% to 1.00p (1H07: 0.85p)• Core funds under trusteeship £1.1bn (1H07: £0.8bn)• Cash at period end £2.23m (1H07: £1.59m) Operational highlights• Number of core schemes increased to 2,032 (1H07: 1,492)• Average scheme value of £0.53m (1H07: £0.51m)• Organic growth of 8.6% in SIPP numbers (1H07: 6.4%)• Investing in recruitment and technology to increase capacity• PCL acquired in July 2007 and fully integrated• Michael Kershaw appointed as second independent director In addition, the Group is pleased to announce the acquisition of the trade andassets of John Bradley Financial Services ("JBFS") and North Star SIPP LLP ("North Star") (together "the JB Group") on 18 February 2008 for a cashconsideration of up to £2.59 million. As stated in an announcement dated 19February 2008, the acquisition of the JB Group enhances Mattioli Woods'consultancy offering and consolidates the Group's position in what remains ahighly fragmented market. Since its admission to AIM, the Group has been committed to expanding the skillsand range of experience represented on our Board of Directors. We are nowpleased to announce the appointment of Michael Kershaw as a second independentnon-executive director, following a highly successful career in investmentbanking with Dresdner Kleinwort Wasserstein and UBS. Commenting on the Interim Results, Bob Woods, Executive Chairman of MattioliWoods, said: "We have continued to deliver strong growth over the six months ended 30November 2007, with turnover up 22.1% and profit before tax up 15.8% compared tothe same period last year. Organic growth in the number of self investedpersonal pension ("SIPP") schemes we act for has been a healthy 8.6% (1H07:6.4%), illustrating that the appeal of SIPPs is spreading to a much wideraudience. We believe this also reflects the growing market presence of MattioliWoods and a greater awareness of the bespoke services we provide. The recentdifficulties in both credit and equity markets have made life more challengingfor investment advisors generally. However, our experience is that demand forbespoke, high quality pension advice is increased during periods of uncertainty. Our first half results reflect this and the robust nature of our fee-basedbusiness model, which has multiple revenue streams and a high proportion ofrecurring income. Trading in the current period continues in line withexpectations and I believe we are very well-placed to take advantage of newopportunities in our key markets as they continue to develop." - Ends - For further information: Mattioli Woods plcBob Woods, Executive Chairman Tel: +44 (0) 116 240 [email protected] www.mattioli-woods.com Ian Mattioli, Chief Executive Tel: +44 (0) 116 240 [email protected] www.mattioli-woods.com Nathan Imlach, Finance Director Tel: +44 (0) 116 240 [email protected] www.mattioli-woods.com Evolution Securities LimitedJoanne Lake, Corporate Finance Tel: +44 (0) 113 243 [email protected] www.evosecurities.com Media enquiries:Abchurch CommunicationsSarah Hollins / Louise Thornhill Tel: +44 (0) 207 398 [email protected] www.abchurch-group.com Chairman's statement I am pleased to report that we have continued to deliver strong growth over thesix months ended 30 November 2007, with turnover up 22.1% and profit before taxup 15.8% compared to the same period last year. Organic growth in the number ofSIPP schemes we act for has been a healthy 8.6% (1H07: 6.4%), illustrating thatthe appeal of SIPPs is spreading to a much wider audience. We believe this alsoreflects the growing market presence of Mattioli Woods and a greater awarenessof the bespoke services we provide. We now act for over 2,000 SIPP and small self-administered pension scheme ("SSAS") clients (1H07: 1,492) throughout the UK, with funds under trusteeship at 30November 2007 totalling £1.1bn (1H07: £760m). We believe that our averagescheme value of over £0.5m is well in excess of the industry average. The acquisition of Pension Consulting Limited ("PCL") was completed in July 2007and I am very satisfied with the successful integration of PCL's business intothe Group. We have seen strong demand for our pension consultancy andinvestment advice from the PCL client base, with 100% retention of the acquiredportfolio achieved to date. The acquisition of the JB Group consolidates our market position by adding afurther 235 SSASs and 55 SIPPs to our core portfolio of clients. Like PCL, theJB Group is an excellent cultural fit with Mattioli Woods and we are also ableto offer its clients a range of additional services, including our syndicatedproperty initiative and guaranteed investment products. Market overview The recent difficulties in both credit and equity markets have made life morechallenging for investment advisors generally. However, our experience is thatdemand for bespoke, high quality pension advice is increased during periods ofuncertainty. We also anticipate the current volatility in global markets willlead to increased demand for our investment advice and capital-guaranteedstructured products. Despite general market conditions, the demand for SIPPs continues to grow,supporting our previously stated view that the appeal of SIPPs is extending dueto the control, flexibility and cost-effectiveness the product offers. However, not all SIPPs are the same. A Mattioli Woods SIPP is extremelyflexible, allowing investment in all areas permitted by HM Revenue & Customs.This includes commercial property and structured products, as well as equities.As trustees of their SIPP, our clients have control of their investments andaccess to proactive and personalised investment advice. Our fee-based servicesare cost-effective and are supported by our robust administration systems. My prediction that the vast Defined Benefit market will wither over the next fewyears has been evidenced by us receiving five new instructions to provideconsultancy on the wind-up of final-salary schemes during the period. Ianticipate the demise of the Defined Benefit market will gather momentum,bringing enormous change within the pensions arena and further consultancyopportunities for pensions advisers, including Mattioli Woods. Trading results The first half's results reflect the robust nature of our fee-based businessmodel, which has multiple revenue streams and a high proportion of recurringincome. In the six months ended 30 November 2007 we achieved increased turnoverof £5.30m (1H07: £4.34m). Profit before tax was up 15.8% to £1.83m (1H07: £1.58m), with EBITDA of £1.86m(1H07: £1.69m). A reported operating margin of 32.1% was achieved (1H07: 35.1%)and earnings per share increased by 15.9% to 7.3 pence (2006: 6.3 pence). The financial result for the equivalent period last year was boosted by £0.1m ofnon-recurring revenue associated with the introduction of PensionSimplification. In addition, the accrual for consultants' bonuses at 30November 2006 was £0.1m lower than that eventually paid following excellentresults for the full year, meaning normalised operating margin has improved to32.1% (1H07: 30.9%). Our pension investment strategy is based around flexible asset management. Weaim to balance our clients' exposure to equity market risk by giving access toother asset classes and have seen strong growth in demand for both commercialproperty investments and structured products. Our clients are able to take a long-term view on investment. Many regard thecurrent weakness in the commercial property market as a buying opportunity.During the first half we facilitated the creation of five new propertysyndicates (1H07: four), purchasing prime commercial property with a total valueof £15.9m (1H07: £9.6m) on our clients' behalf. In the same period we sawclients' cash balances rise to £132m (2H07: £110m). Due to the greater number and higher value property syndicates established inthe period, revenues from this area of our business increased to 18.3% (1H07:10.3%) of total revenues. This included £0.65m (1H07: £0.26m) of one-off feesfrom the creation of new property syndicates and £0.32m (1H07: £0.19m) from agrowing base of annual administration fees relating to existing syndicates. The increase in property syndicate debtors at the period end to £0.6m (1H07:£0.1m) had the effect of reducing cash generated from operations to £0.9m or47.7% of EBITDA (1H07: £1.8m or 108.9%). Net cash generated from operations wasalso impacted by a £0.5m increase in trade debtors and accrued income, togetherwith a £0.2m increase in taxes paid during the period. Cash at the period endincreased to £2.23m (1H07: £1.59m). Dividends The Board is pleased to recommend the payment of an interim dividend for thehalf year ended 30 November 2007 of 1.00 pence (2006: 0.85 pence) per ordinaryshare, and I reiterate our intention to grow dividend distributions sensiblygoing forward. The interim dividend will be paid on 28 March 2008 toshareholders on the Register at the close of business on 29 February 2008. Capacity Our people continue to demonstrate an enormous amount of enthusiasm andcommitment in responding to the challenges faced by our fast-growingorganisation. PCL's thirteen staff moved into our Leicester office immediatelyfollowing the acquisition and it is pleasing they have integrated into MattioliWoods so quickly. Maintaining capacity remains crucial in an environment of growing demand, andour graduate recruitment programme remains on target. Seven new graduatesjoined the Group (2006: seven), increasing our total headcount at the end of theperiod to 123 (2006: 96). Our increased business profile following theadmission to AIM has enhanced our ability to recruit graduates and experiencedpension administration and support staff. The development of a scalable technology platform also remains a key objectivefor the Group. We introduced a new time accounting and invoicing system duringthe period and are continuing to invest in the next phase of development of ourbespoke pension administration system "MWeb". Staff Since its admission to AIM, the Group has been committed to expanding the skillsand range of experience represented on our Board of Directors. We are nowpleased to announce the appointment of Michael Kershaw as a second independentnon-executive director. Michael joins us following a highly successful careerin investment banking with Dresdner Kleinwort Wasserstein and UBS. I amconfident his experience will enhance our ability to deliver futureprofitability and growth. I have highlighted previously that Mattioli Woods enjoys a strong team spiritand commitment from all of its staff and it remains our aim to build on thatculture by continuing to facilitate wider equity participation within theorganisation. The introduction of the Mattioli Woods Share Incentive Plan inMarch 2008 will be an important step towards this objective. Principally, the share incentive plan will enable our employees to buy shares inthe Company at an effective discount to the Stock Exchange price by having anamount deducted from pre-tax salary each month. Shareholders Following the placing of a further 3,239,594 shares by Ian Mattioli and myselfduring the period we have expanded the excellent institutional shareholder basewe have enjoyed since joining the AIM market. We are also pleased to bedeveloping a wider private client shareholder base. It is your Board'sintention to continue to communicate fully with all our shareholders, and thewider market, and in so doing build further awareness of Mattioli Woods over thecoming years. Regulation Currently, money built up from national insurance rebates when people contractout of the state second pension ("protected rights monies") can only be held ina restricted range of insured funds, bank deposits and mutual funds. InDecember 2007 the Government published plans to permit SIPPs to hold protectedrights monies from October 2008. This is likely to be the catalyst for furthergrowth in the SIPP market, with predictions that much of the £75bn to £100bnlocked up in protected rights savings could move into SIPPs. The Financial Services Authority ("FSA") published the discussion paper "AReview of Retail Distribution" in June 2007, seeking to improve the efficiencyof the market for the distribution of retail investment products. I believe theincreased regulatory and professional requirements proposed by the FSA's reviewmay lead to further consolidation within our key markets. The review also proposes wider adoption of a more transparent remuneration model(known as "Customer Agreed Remuneration") where the costs of intermediaryservices are separated from the costs of the product. Our fee-based revenuemodel means Mattioli Woods is well-placed to deal with any such regulatorychange. Outlook The demand for bespoke pensions advice is amplified during periods ofuncertainty. To capitalise on this and other opportunities, we are developing anumber of sales initiatives including direct marketing to individual businesses,internal seminars for accountancy practices and the use of telemarketing tosupport our various marketing initiatives. In anticipation of difficult investment markets our clients have been advised totake profits and build liquidity within their schemes. Client cash balanceshave continued to grow to over £145m today, with an additional £17m invested intreasury accounts. We expect this to lead to increased investment planning workwhen more stable markets return. We are seeking to provide a broader range of retirement wealth managementservices to more of our clients, and hence I expect us to increase assets underadvice through a combination of attracting new clients and advising on a greaterproportion of our existing clients' wealth. Trading in the current period continues to be in line with expectations and Ibelieve we are very well-placed to take advantage of new opportunities in ourkey markets as they continue to develop. Bob WoodsChairman19 February 2008 Independent review report to Mattioli Woods plc Introduction We have been engaged by the Group to review the condensed set of financialstatements in the interim financial report for the six months ended 30 November2007 which comprises the income statement, balance sheet, statement ofrecognised income and expense and associated notes. We have read the otherinformation contained in the interim financial report and considered whether itcontains any apparent misstatements or material inconsistencies with theinformation in the condensed set of financial statements. This report, including the conclusion, has been prepared for and only for theGroup for the purpose of meeting the requirements of the AIM Rules for Companiesand for no other purpose. We do not, therefore, in producing this report,accept or assume responsibility for any other purpose or to any other person towhom this report is shown or into whose hands it may come save where expresslyagreed by our prior consent in writing. Directors' Responsibilities The interim financial report, is the responsibility of, and has been approved bythe directors. The directors are responsible for preparing and presenting theinterim financial report in accordance with the AIM Rules for Companies. As disclosed in Note 2, the annual financial statements of the Group areprepared in accordance with International Financial Reporting Standards ("IFRS")and International Financial Reporting Interpretations Committee ("IFRIC")pronouncements as adopted by the European Union. The condensed set of financialstatements included in this interim financial report has been prepared inaccordance with International Accounting Standard ("IAS") 34 "Interim FinancialReporting", as adopted by the European Union. Our Responsibility Our responsibility is to express to the Group a conclusion on the condensed setof financial statements in the interim financial report based on our review. Scope of Review We conducted our review in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410, "Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity" issued by the AuditingPractices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries,primarily of persons responsible for financial and accounting matters, andapplying analytical and other review procedures. A review is substantially lessin scope than an audit conducted in accordance with International Standards onAuditing (UK and Ireland) and consequently does not enable us to obtainassurance that we would become aware of all significant matters that might beidentified in an audit. Accordingly, we do not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believethat the condensed set of financial statements in the interim financial reportfor the six months ended 30 November 2007 is not prepared, in all materialrespects, in accordance with IAS 34 "Interim Financial Reporting" as adopted bythe European Union, and the AIM Rules for Companies. Baker Tilly UK Audit LLPChartered Accountants2 Whitehall QuayLeedsLS1 4HG 18 February 2008 Interim condensed consolidated income statement Unaudited Unaudited Audited Six months Six months Year ended ended ended 30 Nov 30 Nov 31 May 2007 2006 2007For the six months ended 30 November 2007 Notes £ £ £ Revenue 4 5,295,879 4,342,664 8,997,191 Employee benefits expense (2,666,122) (1,878,673) (4,219,130)Other administrative expenses (762,612) (770,282) (1,605,889)Depreciation and amortisation (163,731) (166,047) (213,359)Loss on disposal of property, plant and equipment (5,392) (3,876) (7,407) Operating profit before financing 4 1,698,022 1,523,786 2,951,406 Financial income 144,793 53,187 194,734Financial expenses (13,139) (51) (1,012) Net financing income/(costs) 131,654 53,136 193,722 Profit before tax 1,829,676 1,576,922 3,145,128 Income tax expense 7 (567,426) (495,759) (952,274) Profit for the period 1,262,250 1,081,163 2,192,854 Attributable to:Equity holders of the parent 1,262,250 1,081,163 2,192,854 Earnings per ordinary share:Basic (pence) 5 7.3 6.3 12.8Diluted (pence) 5 7.3 6.3 12.8Dividend per share (pence) 6 1.00 0.85 2.55 The operating profit for each period arises from the Group's continuingoperations. Interim condensed consolidated statement of recognised income and expense Unaudited Unaudited Audited Six months Six months Year ended ended ended 30 Nov 30 Nov 31 May 2007 2006 2007For six months ended 30 November 2007 Notes £ £ £ Deferred tax on share-based payments 7 31,862 18,211 102,031 Income and expense recognised directly in equity 31,862 18,211 102,031 Profit for the period 1,262,250 1,081,163 2,192,854 Total recognised income and expense for the period 1,294,112 1,099,374 2,294,885 Interim condensed consolidated balance sheet Unaudited Unaudited Audited 30 Nov 2007 30 Nov 2006 31 May 2007As at 30 November 2007 Notes £ £ £ AssetsProperty, plant and equipment 10 465,910 374,404 429,312Intangible assets 7,695,576 5,744,065 5,804,209Investments 9 15 - -Deferred income tax assets 7 191,081 41,738 143,936 Total non-current assets 8,352,582 6,160,207 6,377,457 Trade and other receivables 4,396,144 2,870,761 3,179,978Financial assets 964,378 1,817,442 1,954,315Cash and cash equivalents 12 2,357,758 1,593,425 2,799,569 Total current assets 7,718,280 6,281,628 7,933,862 Total assets 16,070,862 12,441,835 14,311,319 EquityIssued capital 172,159 172,159 172,159Share premium 13 5,601,458 5,601,458 5,601,458Other reserves 13 2,286,660 2,086,545 2,202,469Retained earnings 13 4,850,394 2,915,459 3,880,814 Total equity attributable to equity holders of 12,910,671 10,775,621 11,856,900the parent Non-current liabilitiesDeferred income tax liabilities 7 304,666 - -Provisions and other liabilities 316,167 130,607 127,446 620,833 130,607 127,446 Current liabilitiesTrade and other payables 1,601,610 888,669 1,627,889Current income tax liabilities 7 558,546 515,841 477,234Bank overdraft 12 115,565 - 72,818Provision and other liabilities 263,637 131,097 149,032 2,539,358 1,535,607 2,326,973 Total liabilities 3,160,191 1,666,214 2,454,419 Total equities and liabilities 16,070,862 12,441,835 14,311,319 Interim condensed consolidated statement of cash flows Unaudited Unaudited Audited Six months Six months Year ended ended ended 30 Nov 30 Nov 31 May 2007 2006 2007For the six months ended 30 November 2007 Notes £ £ £ Cash flows from operating activitiesCash receipts from customers 4,331,327 4,661,087 9,006,546Cash paid to suppliers and employees (3,473,143) (2,869,943) (5,290,352) Cash generated from operations 858,184 1,791,144 3,716,194 Interest paid (13,139) (51) (1,012)Income taxes paid 7 (594,727) (360,607) (874,107) Net cash from operating activities 250,318 1,430,486 2,841,075 Cash flows from investing activitiesProceeds from sale of property, plant and equipment 10 4,000 474 15,225Interest received 144,793 53,187 194,734Acquisition of subsidiaries 8 (1,627,485) - (231,892)Cash received on acquisition of subsidiaries 8 183,805 - 234,443Acquisition of other investments 9 (15) - -Acquisition of property, plant and equipment 10 (89,581) (62,400) (164,853)Acquisition of software (35,646) - (78,193)New loans advanced to property syndicates (964,378) (1,817,442) (1,954,315)Loan repayments from property syndicates 1,954,315 1,915,994 1,915,994 Net cash from investing activities (430,192) 89,813 (68,857) Cash flows from financing activitiesProceeds from the issue of share capital - 225,000 225,000Repayment of Directors' loans (12,014) (6,693) 21,050Dividends paid 6 (292,670) (238,636) (384,972) Net cash from financing activities (304,684) (20,329) (138,922) Net (decrease)/increase in cash and cash equivalents (484,558) 1,499,970 2,633,296Cash and cash equivalents at start period 12 2,726,751 93,455 93,455 Cash and cash equivalents at end period 2,242,193 1,593,425 2,726,751 Notes to the interim condensed consolidated financial statements 1 Corporate information Mattioli Woods plc ("the Company") is a public limited company incorporated anddomiciled in England and Wales. The Company's ordinary shares are traded on theAIM market of the London Stock Exchange plc. The interim condensed consolidatedfinancial statements of the Company for the six months ended 30 November 2007comprise the Company and its subsidiaries (together referred to as the "Group").The interim condensed consolidated financial statements were authorised forissue in accordance with a resolution of the directors on 18 February 2008. The principal activities of the Group are described in Note 4. 2 Basis of preparation and accounting policies 2.1 Basis of preparation The interim condensed consolidated financial statements for the six months ended30 November 2007 have been prepared in accordance with IAS 34 Interim FinancialReporting. The interim condensed consolidated financial statements do not include all theinformation and disclosures required in the annual financial statements, andshould be read in conjunction with the Group's annual financial statements as at31 May 2007. The information relating to the six months ended 30 November 2007 and the sixmonths ended 30 November 2006 is unaudited and does not constitute statutoryaccounts. The comparative figures for the year ended 31 May 2007 are not theCompany's statutory accounts for that financial year. The statutory accountsfor the year ended 31 May 2007, prepared in accordance with accounting standardsadopted for use in the European Union (International Financial ReportingStandards ("IFRS")), 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 a statement under section 237(2) or (3) of theCompanies Act 1985. The interim financial statements are unaudited but havebeen reviewed by the auditors and their report to the Board of Mattioli Woodsplc is included within these financial statements. 2.2 Significant accounting policies The accounting policies adopted in the preparation of the interim condensedconsolidated financial statements are consistent with those followed in thepreparation of the Group's annual financial statements for the year ended 31 May2007 except for the adoption of new Standards and Interpretations, noted below.Adoption of these Standards and Interpretations did not have any effect on thefinancial position or performance of the Group. • IFRS 7 Financial Investments: Disclosures The Group adopted IFRS 7 as of 1 June 2007, which requires that an entity mustdisclose additional information about financial instruments, their significanceand the nature and extent of risks that they give rise to. More specifically,the Company and Group will need to disclose the fair value of financialinstruments and their risk exposure in greater detail. There will be no effecton reported income or net assets. • Amendment to IAS 1 Presentation of financial statements -capital disclosures The Group adopted IAS 1 as of 1 June 2007, which requires that an entity mustdisclose additional information about management of its capital, includingquantitive information on what it manages as capital. • IFRIC 9 Reassessment of Embedded Derivatives The Group adopted IFRIC Interpretation 9 as of 1 June 2007, which states thatthe date to assess the existence of an embedded derivative is the date that anentity first becomes party to the contract, with reassessment only if there is achange to the contract that significantly modifies the cash flows. • IFRIC 10 Interim Financial Reporting and Impairment The Group adopted IFRIC Interpretation 10 as of 1 June 2007, which requires thatan entity must not reverse an impairment loss recognised in a previous interimperiod in respect of goodwill or an investment in either an equity instrument ora financial asset carried at cost. • IFRIC 11 IFRS2 Group and Treasury Share Transactions The Group adopted IFRIC Interpretation 11 as of 1 June 2007, which requiresarrangements whereby an employee is granted rights to an entity's equityinstruments to be accounted for as an equity-settled scheme, even if the entitybuys the instruments from another party, or the shareholders provide the equityinstruments needed. The Group has also elected to early adopt IFRS 8 Operating Segments as of 1 June2007. IFRS 8 introduces the "management approach" to segment reporting, whichrequires the disclosure of segment information based on the internal reportsregularly reviewed by the Board of Directors (the Chief Operating DecisionMaker) in order to assess each segment's performance. Adoption of this standarddid not have any effect on the financial position or performance of the Group.The Group determined that the operating segments were the same as the businesssegments previously identified under IAS 14. Additional disclosures about eachof these segments is shown in Note 4, including revised comparative information. The accounting policies have been applied consistently throughout the Group forthe purposes of these interim condensed consolidated financial statements. New standards and interpretations not yet effective The International Accounting Standards Board ("IASB") and InternationalFinancial Reporting Interpretation Committee ("IFRIC") have issued Standards andInterpretations with an effective date for periods starting on or after the dateon which these financial statements start. The directors do not anticipate thatthe adoption of these Standards and Interpretations, wherever relevant toMattioli Woods, will have a material impact on the Company's or the Group'sfinancial statements in the period of initial application. Standards and Interpretations that are not yet effective and have not been earlyadopted by the Company or Group are explained as follows: • Revised IAS 23 Borrowing Costs removes the option to expenseborrowing costs and requires that an entity capitalise borrowing costs directlyattributable to the acquisition, construction or production of a qualifyingasset as part of the cost of that asset. The revised IAS 23 applies toborrowing costs relating to qualifying assets for which the commencement datefor capitalisation is on or after 1 January 2009, and will constitute a changein accounting policy for the Group. In accordance with the transitionalprovisions the Group will apply the revised IAS 23 to qualifying assets forwhich capitalisation of borrowing costs commences on or after the effectivedate. • IFRIC 12 Service Concession Arrangements provides guidance oncertain recognition and measurement issues that arise in accounting forpublic-to-private service concession arrangements. IFRIC 12, which would firstapply to the accounting period beginning on 1 June 2008, is not expected to haveany effect on the consolidated financial statements. • IFRIC 13 Customer Loyalty Programmes addresses the accounting byentities that operate, or otherwise participate in, customer loyalty programmesfor their customers. It relates to customer loyalty programmes under which thecustomer can redeem credits for awards such as free or discounted goods orservices. IFRIC 13, which would first apply to the accounting period beginningon 1 June 2009, is not expected to have any impact on the consolidated financialstatements. • IFRIC 14 IAS 19 - The Limit on a Defined Benefit Asset, MinimumFunding Requirements and their Interaction clarifies when refunds or reductionsin future contributions in relation to defined benefit assets should be regardedas available and provides guidance on the impact of minimum funding requirements("MFR") on such assets. It also addresses when a MFR might give rise to aliability. IFRIC 14, which would first apply to the accounting period on 1 June2008, is not expected to have an effect on the consolidated financialstatements. IFRIC 12, IFRIC 13 and IFRIC 14 have not yet been endorsed by the EuropeanUnion. 2.3 Basis of consolidation The interim condensed consolidated financial statements consolidate thefinancial statements of the Company and its subsidiary undertakings drawn as at30 November each year. The financial statements of subsidiaries are preparedfor the same reporting period as the parent company, using consistent accountingpolicies. Subsidiaries are fully consolidated from the date of acquisition, being the dateon which the Group obtains control, and continue to be consolidated until thedate that such control ceases. Control exists when the Company has the power,directly or indirectly, to govern the financial and operating policies of anentity so as to obtain benefit from its activities and is achieved throughdirect or indirect ownership of voting rights; currently exercisable orconvertible potential voting rights; or by way of contractual agreement. Allinter-group balances, transactions, income and expenses and profits and lossesresulting from inter-group transactions that are recognised in assets areeliminated in full. 2.4 Significant accounting estimates and assumptions The key assumptions concerning the future and other key sources of estimationuncertainty at the balance sheet date, that have a significant risk of causing amaterial adjustment to the carrying amounts of assets and liabilities within thenext financial year, are discussed below. Impairment of goodwill The Group determines whether goodwill is impaired at least on an annual basis.This requires an estimation of the fair value less cost to sell of thecash-generating unit to which the goodwill is allocated. Estimating a fairvalue less cost to sell amount requires management to make an estimate of therealisable value of the cash generating unit. The carrying amount of goodwillat 30 November 2007 was £3,327,937 (2006: £2,347,130). Further details on thecalculation of goodwill arising on acquisitions during the period are given inNote 8. Deferred tax assets Deferred tax assets include temporary differences related to employee benefitssettled via the issue of share options. Recognition of the deferred tax assetsassumes share options will have a positive value at the date of vesting, whichis greater than the share option cost recognised in the income statement. Recoverability of accrued time costs The Group recognises accrued income in respect of time costs incurred onclients' affairs during the accounting period, which have not been invoiced atthe balance sheet date. This requires an estimation of the recoverability ofthe time costs incurred but not invoiced to clients. The carrying amount ofaccrued time costs at 30 November 2007 was £1,496,452 (2006: £1,069,355). Accrued commission income Accrued commission income is recognised in respect of commissions due to theGroup on investments and bank deposits placed during the accounting period whichhave not been received at the balance sheet date. This requires an estimationof the amount of commission income that will be received subsequent to thebalance sheet date in respect of the accounting period. The carrying amount ofaccrued commission income at 30 November 2007 was £603,849 (2006: £451,630). Deferred consideration The Group has entered into certain acquisition agreements that provide fordeferred consideration to be paid via an earn-out. A provision is recognisedfor all amounts management anticipates will be paid under the relevantacquisition agreement. This requires management to make an estimate of theexpected future cash flows from the acquired client portfolio and also to choosea suitable discount rate for the calculation of the present value of those cashflows. The deferred consideration provision at 30 November 2007 was £401,630(2006: £103,030). Further details of the deferred consideration payable onacquisitions during the period are given in Note 8. 3. Seasonality of operations The Group's operations are not subject to any recurrent seasonal fluctuations asa result of external factors. Historically, revenues in the second-half yeartypically have been higher than in the first half, primarily due to SSAS schemeyear-ends being linked to the sponsoring company's year-end, which is often inDecember or March. However, with the growth in the number of SIPP schemes underadministration and further diversification of the Group's revenue streams inrecent periods, the Board of Directors believes the seasonal impact of SSASscheme year-ends will no longer be material. 4. Segment information The Group is comprised of the following operating segments: • Time-based fees - income earned for setting up and administeringpension schemes. Additional fees are generated from consultancy servicesprovided for special one-off activities; • Investment planning - income generated from the placing of investmentson clients' behalf with banks and other financial institutions; and • Property syndicates - income generated where the Group facilitatescommercial property transactions on behalf of its clients. Each segment represents a revenue stream subject to risks and returns that aredifferent to other operating segments, although each operating segment'sproducts and services are offered to the same market. The Group operatesexclusively within the United Kingdom. There are no transfers between operating segments and hence there are nodifferences between total segment revenue and consolidated revenue. Each operating segment utilises the same intangible and tangible assets, and thesegments have been financed as a whole, rather than individually. Thereportable operating segments are managed together, as one business operatingfrom one location. Accordingly, only employee benefit expenses and other directcosts have been allocated across the reportable operating segments. Segment profit or loss reflects the measure of segment performance reviewed bythe Board of Directors (the Chief Operating Decision Maker). This measurediffers from the numbers used in the financial statements prepared in accordancewith IFRS as follows: • Finance revenue - Interest revenue from loans receivable andcash at bank is not included in the measure of segment profit or loss as it isnot considered part of the core operations of any segment. • Finance costs - Finance costs are not included in the measure ofsegment profit or loss. • Indirect overheads - Indirect overheads including propertycosts, amortisation and impairment of intangible assets, depreciation ofproperty, plant and equipment, sales and marketing costs, legal and professionalfees and insurance are not included in the measure of segment profit or loss asit is not possible to allocate these overheads to individual segments withoutmaking arbitrary allocations. Segment assets exclude property, plant and equipment, intangible assets,investments, current and deferred tax balances, cash and cash equivalents, as these assets are considered corporate in nature and are not allocated to aspecific operating segment. Operating segments The following table presents revenue and profit information regarding theGroup's operating segments: 4. Segment information (continued) Time-based fees Investment planning Property syndicates Six Six Six Six Six Six months months Year months months Year months months Year ended ended ended ended ended ended ended ended ended 30 Nov 30 Nov 31 May 30 Nov 30 Nov 31 May 30 Nov 30 Nov 31 May 2007 2006 2007 2007 2006 2007 2007 2006 2007 Operating segments £ £ £ £ £ £ £ £ £ Total revenue 2,228,321 2,010,838 3,986,367 2,095,818 1,883,547 4,077,908 971,740 448,279 932,916 Results Employeebenefitsexpense 1,945,562 1,403,397 3,036,168 363,044 185,062 503,138 357,516 290,214 679,824Otheradministrativeexpense 72,278 141,240 269,909 93,352 43,475 256,655 9,195 - - Segment profit 210,481 466,201 680,290 1,639,422 1,655,010 3,318,115 605,029 158,065 253,092 Unallocated indirect overheads Operating profit before financing Net finance income Profit before income tax Income tax expense Net profit for the period Total Six months Six months Year ended ended ended 31 May 2007 30 Nov 30 Nov 2007 2006Operating segments £ £ £ Total revenue 5,295,879 4,342,664 8,997,191 Results Employee benefits expense 2,666,122 1,878,673 4,219,130Other administrative expense 174,825 184,715 526,564 Segment profit 2,454,932 2,279,276 4,251,497 Unallocated indirect overheads 756,910 755,490 1,300,091 Operating profit before financing 1,698,022 1,523,786 2,951,406 Net finance income 131,654 53,136 193,722 Profit before income tax 1,829,676 1,576,922 3,145,128 Income tax expense (567,426) (495,759) (952,274) Net profit for the period 1,262,250 1,081,163 2,192,854 4. Segment information (continued) Total segment assets The following table compares total segment assets as at 30 November 2007, 30November 2006 and 31 May 2007 (the date of the last annual financialstatements). Unaudited Unaudited Audited 30 Nov 30 Nov 31 May 2007 2006 2007 £ £ £ Time-based fees 2,796,969 2,123,468 2,136,427Investment planning 603,849 485,956 588,923Property syndicates 1,760,904 1,988,468 2,095,868 Total segment assets 5,161,722 4,597,892 4,821,218 Property plant and equipment 465,910 374,404 429,312Intangible assets 7,695,576 5,744,065 5,804,209Investments 15 - -Deferred tax 191,081 41,738 143,936Prepayments 72,508 47,637 97,649Other receivables 126,292 42,674 215,426Cash and cash equivalents 2,357,758 1,593,425 2,799,569 Total consolidated assets 16,070,862 12,441,835 14,311,319 5. Earnings per ordinary share Basic earnings per share amounts are calculated by dividing net profit for theyear attributable to ordinary equity holders of the Company by the weightedaverage number of ordinary shares outstanding during the period. Diluted earnings per share amounts are calculated by dividing the net profitattributable to ordinary equity holders of the Company by the weighted averagenumber of ordinary shares outstanding during the year plus the weighted averagenumber of ordinary shares that would be issued on the conversion of all thedilutive potential ordinary shares into ordinary shares. The following reflects the income and share data used in the basic and dilutedearnings per share computations: Unaudited Unaudited Audited Six months Six months Year ended ended ended 30 Nov 30 Nov 31 May 2007 2006 2007 £ £ £ Net profit and diluted net profit attributable to equity 1,262,250 1,074,582 2,192,854holders of the Company Weighted average number of ordinary shares: Thousands Thousands Thousands Issued ordinary shares at start period 17,216 17,045 17,045Effect of shares issued in October 2006 - 42 107 Basic weighted average number of shares 17,216 17,087 17,152 Dilutive potential ordinary shares:- non-employee share options - 48 27 Diluted weighted average number of shares 17,216 17,135 17,179 The Company has granted options under the Share Option Plan and Consultants'Share Option Plan to certain of its senior managers and directors to acquire (inaggregate) up to 8.05% of its issued share capital (see Note 11). Under IAS 33Earnings Per Share, contingently issuable ordinary shares are treated asoutstanding and included in the calculation of diluted earnings per share if theconditions (the events triggering the vesting of the option) are satisfied. At30 November 2007 the conditions are not satisfied. If the conditions had beensatisfied, diluted earnings per share would have been 6.8 pence per share (2006:6.0 pence). There have been no other transactions involving ordinary shares or potentialordinary shares between the reporting date and the date of completion of thesefinancial statements. 6. Dividends paid and proposed Unaudited Unaudited Audited Six months Six months Year ended ended ended 30 Nov 30 Nov 31 May 2007 2006 2007 £ £ £Paid during the year period:Equity dividends on ordinary shares:- Final dividend for 2007: 1.70p (2006: 1.40p) 292,670 238,636 238,636- Interim dividend for 2007: 0.85p (2006: nil) - - 146,336 Dividends paid 292,670 238,636 384,972 Proposed for approval:Equity dividends on ordinary shares:- Interim dividend for 2008: 1.00p (2007: 0.85p) 172,159 146,335 -- Final dividend for 2007: 1.70p (2006: 1.40p) - - 292,670 Dividends proposed 172,159 146,335 292,670The proposed dividend was approved on 21 January 2008. 7. Income taxes Current tax Current tax expense for the interim periods presented is the expected taxpayable on the taxable income for the period, calculated as the estimatedaverage annual effective income tax rate applied to the pre-tax income of theinterim period. Current tax for current and prior periods is classified as a current liabilityto the extent that it is unpaid. Amounts paid in excess of amounts owed areclassified as a current asset. Deferred tax The amount of deferred tax provided is based on the expected manner ofrealisation or settlement of the carrying amount of assets and liabilities,using the estimated average annual effective income tax rate for the interimperiods presented. The primary components of the entity's recognised deferredtaxed assets include temporary differences related to employee benefits,provisions and other items. The primary components of the entity's deferred tax liabilities includetemporary differences related to property, plant and equipment and intangibleassets (see Note 8). The recognition of deferred tax in the income statement arises from theorigination and the reversal of temporary differences and the effects of changesin tax rates. The primary component of the deferred tax credit for the sixmonths ended 30 November 2007 of £15,283 (2006: £6,581) is related to temporarydifferences arising on share-based payments to employees. The total deferred tax asset recognised directly in equity was £31,862 for thesix months ended 30 November 2007 (2006: £18,211). Reconciliation of effective tax rates The current tax expense for the six months ended 30 November 2007 was calculatedbased on the estimated average annual effective income tax rate of 31.0% (2006:31.4%), as compared to the tax rates expected to be enacted or substantivelyenacted at the balance sheet date of 30% (2006: 30%). Differences between theestimated average annual effective income tax rate and statutory rate include,but are not limited to the effect of non-deductible expenses, tax incentives notrecognised in profit or loss and under/(over) provisions in previous periods. 8. Business combination Acquisition of Pension Consulting Limited On 9 July 2007, the Group acquired 100% of the voting shares of PensionConsulting Limited ("PCL"), an unlisted company registered in England and Wales,which administered pension schemes on behalf of 145 small self-administeredpension schemes ("SSAS") and 213 self-invested personal pension ("SIPP")clients. As part of the transaction the Group also acquired PCL's 100%subsidiary company, PC Trustees Limited, which acts as trustee to the pensionschemes. The acquisition has been accounted for using the purchase method ofaccounting. The interim condensed consolidated financial statements include theresults of PCL for the period from the acquisition date. The fair value of the identifiable assets and liabilities of PCL as at the dateof acquisition were: Unaudited Fair value recognised Previous carrying on acquisition value £ £ Property, plant and equipment 16,511 17,545Intangible asset - client portfolio 1,015,554 -Investment 100 100Prepayments and accrued income 165,220 165,220Trade receivables 42,340 42,340Other receivables 44,055 44,055Cash and cash equivalents 183,805 183,805 1,467,585 453,065 Deferred income tax liability (304,666) -Short term subordinated loan (29,883) (29,883)Trade payables (19,421) (19,421)Current income tax liability (61,468) (61,468)Other payables (25,388) (25,388)Accruals and deferred income (37,081) (37,081) (477,907) (173,241) Fair value of net assets 989,678 279,824Goodwill arising on acquisition 980,807 Total acquisition cost 1,970,485 The total acquisition cost of £1,970,485 comprises an initial cash payment of£1,525,000, deferred consideration of up to £400,000 and costs of £45,485directly attributable to the acquisition. £240,000 of the deferredconsideration will be paid in the two years following completion, with theremaining payment of up to £160,000 being determined by reference to an earn-outmechanism based on growth in scheme numbers during the two years followingcompletion. In accordance with IFRS 3 Business Combinations, a value has been applied to thePCL client portfolio at the date of acquisition to recognise the value of thisasset to the Group. In accordance with IAS12 Income Taxes, an associateddeferred tax liability has also been recognised on the value of the clientportfolio. Cash outflow on acquisition: Unaudited £ Net cash acquired with the subsidiary 183,805Cash paid (1,525,000)Acquisition costs (45,485) Net cash outflow (1,386,680) From the date of acquisition, PCL has contributed £106,389 to the profit of theGroup. If the combination had taken place at the beginning of the year, theprofit for the Group would have been £1,231,981 and revenue from continuingoperations would have been £5,308,351. The goodwill recognised above is attributed to the expected synergies and otherbenefits from combining the assets and activities of PCL with those of theGroup. On 30 November 2007 the trade and assets of PCL were transferred toMattioli Woods for a consideration of £386,212 equivalent to the net asset valueof PCL at that date. 9. Investments On 1 October 2007, Mattioli Woods subscribed £15 for 15% of the issued sharecapital of Mainsforth Developments Limited ("Mainsforth"), a companyincorporated in England and Wales with its principal activity being thedevelopment and selling of real estate. On the same date, Mainsforth enteredinto two conditional sales agreements ("CSAs") to acquire freehold land. The first CSA gives Mainsforth the right to acquire certain freehold land ("LandA") with vacant possession for a purchase consideration of £1.0m. The second CSA gives Mainsforth the right to acquire other freehold landadjacent to Land A ("Land B") with vacant possession for a purchaseconsideration of £2.8m, subject to an upwards and downwards adjustment if theconsideration (the "Development Consideration") payable to Mainsforth on thesale of Land A and Land B (together "the Development Land") is greater or lessthan £10.0m, subject to the condition that the consideration payable for Land Bshall not be reduced below £2.2m. Both CSAs are conditional upon Mainsforth submitting an application for planningapproval prior to 1 June 2008 and the effective date of the agreements will bethe date on which planning approval is granted for the development of theDevelopment Land as a mixed use scheme where residential property comprises atleast 50% of the built area. Any consideration payable by Mainsforth under theCSAs only becomes payable on completion of its sale of the Development Land. Ifplanning approval has not been obtained by 1 December 2010 the agreements willlapse, although the termination dates may be extended to 1 December 2011 ifcertain conditions are fulfilled. 10. Property, plant and equipment Acquisitions and disposals During the six months ended 30 November 2007, the Group acquired assets with acost of £125,227 (2006: £62,400). Assets with a net book value of £9,392 weredisposed of during the six months ended 30 November 2007 (2006: £4,350),resulting in a loss on disposal of £5,392 (2006: £3,876). Capital commitments During the six months ended 30 November 2006, the Group entered into a contractto purchase and install new accounting software. At 30 November 2007 the Groupwas committed to purchasing products and services costing £55,891 (2006:£123,075) under this contract. 11. Share based payment Share Option Plan The Company operates the Share Option Plan by which certain of the executivedirectors and other senior executives are able to subscribe for 875,000 ordinaryshares in the Company. The exercise price of the options is £1.32, equal to theplacing price of the shares issued on 15 November 2005. The options vest if andwhen profit-based performance conditions between 1 June 2005 and 31 May 2011 arefulfilled. A failure to meet these performance conditions causes the optionsto lapse. The contractual life of each option once granted expires on 31 May2015. Consultants' Share Option Plan On 4 September 2007, options to subscribe for up to 255,684 ordinary shares inthe Company were granted to senior executives under the Consultants' ShareOption plan. Options granted under the Consultants' Share Option Plan aresummarised as follows: Exercise At 1 June Granted Exercised Lapsed during At 31 May price 2007 during the during the the year 2008 year year £ No. No. No. No. No. Date of grant 5 September 2006 2.21 255,684 - - - 255,6844 September 2007 2.79 - 255,684 - - 255,684 255,684 255,684 - - 511,368 The exercise price of the options is equal to the market price of the shares atthe close of business on the day immediately preceding the date of grant. Theoptions vest if and when the option holder achieves certain individualperformance hurdles. If these performance hurdles, which are linked toindividual sales revenues, are not met over the five financial years commencingon 1 June before the date of grant, the options lapse. The expense for share-based payments made in respect of employee services underthe Share Option Plan and the Consultants' Share Option Plan are recognised overtheir expected vesting periods. The expense recognised during the six monthsended 30 November 2007 is £52,329 (2006: £30,658), which arises entirely fromequity-settled share-based payment transactions. The fair value of equity-settled share options granted is estimated as at thedate of grant using the Black-Scholes-Merton model, taking into account theterms and conditions upon which the options were granted. The following tablelists the inputs to the model used to estimate the fair value of options grantedduring the six months ended 30 November 2007: Consultants' Share Option Plan Share price at date of grant £2.82Option exercise price £2.79Expected life of option (years) 7Expected share price volatility (%) 30.0Dividend yield (%) 1.11Risk-free interest rate (%) 4.63 The share price at date of grant for options issued under the Share Option Planand Consultants' Share Option Plan is based on the market value of the shares onthat date as agreed by HM Revenue & Customs. The expected life of the optionsis based on historical data and is not necessarily indicative of exercisepatterns that may occur. The expected volatility reflects the assumption thatthe historical volatility is indicative of future trends, which may also notnecessarily be the actual outcome. No other features of options grant wereincorporated into the measurement of fair value. 12. Cash and cash equivalents For the purpose of the interim condensed consolidated cash flow statement, cashand cash equivalents are comprised of the following: Unaudited Unaudited Audited 30 Nov 2007 30 Nov 2006 31 May 2007 £ £ £ Cash at banks and on hand 2,257,758 1,593,425 2,799,569Short-term deposits 100,000 - - 2,357,758 1,593,425 2,799,569Bank overdrafts (115,565) - (72,818) 2,242,193 1,593,425 2,726,751 Cash at banks earns interest at floating rates based on daily bank depositrates. Short-term deposits are made for varying periods of between one day and12 months, depending on the immediate cash requirements of the Group, and earninterest at the respective short-term deposit rates. The fair value of cash andshort-term deposits at 30 November 2007 is £2,242,193 (2006: £1,593,425). At 30 November 2007, the Group had available £3,134,435 (2006: £600,000) ofundrawn committed borrowing facilities. 13. Reserves Share premium Equity - share Capital Retained account based payments redemption earnings reserve £ £ £ £ At 1 June 2006 - audited 5,321,151 94,687 2,000,000 2,072,932Arising on share issue 223,296 - - -Share based payments - 30,658 - -Exercise of share options 57,011 (57,011) - -Deferred tax asset recognised in equity - 18,211 - -Profit for the financial period - - - 1,081,163Dividends - - - (238,636) At 30 November 2006 - unaudited 5,601,458 86,545 2,000,000 2,915,459Share-based payments - 32,104 - -Deferred tax asset recognised in equity - 83,820 - -Profit for the financial period - - - 1,111,691Dividends - - - (146,336) At 31 May 2007 - audited 5,601,458 202,469 2,000,000 3,880,814Share-based payments - 52,329 - -Deferred tax asset recognised in equity - 31,862 - -Profit for the financial period - - - 1,262,250Dividends - - - (292,670) At 30 November 2007 - unaudited 5,601,458 286,660 2,000,000 4,850,394 14. Related party transactions Transactions with key management personnel The private pension schemes of Ian Mattioli, Robert Woods, Nathan Imlach andMurray Smith, together with the private pension schemes of other key managementpersonnel of the Group, have a beneficial interest in MW Properties (No 16)Limited. The Group leases its premises at Grove Park, Enderby from MWProperties (No 16) Limited, and paid rentals of £84,000 during the six monthsended 30 November 2007 (2006: £84,000). At 30 November 2007 the Group hadprepaid future rentals of £11,047 (2006: £11,047). Key management personnel receive compensation in the form of short-term employeebenefits and equity compensation benefits (see Note 11). Key managementpersonnel, representing the executive directors and four senior executives,received total compensation of £789,776 for the six months ended 30 November2007 (2006: £666,273). Total remuneration is included in "employee benefitsexpense". 15. Events after the balance sheet date Acquisition of the JB Group On 18 February 2008 the Group acquired the trade and assets of John BradleyFinancial Services ("JBFS") and North Star SIPP LLP ("North Star") (together "the JB Group") for a total consideration of up to £2.59 million, subject tocertain revenue and client retention targets being met during the three yearsfollowing completion. On 18 February 2008 the Company also entered into separate agreements to acquirethe entire issued share capital of JB Trustees Limited and Bank Street TrusteesLimited (together "the Trustee Companies") and John Bradley Financial ServicesLimited (together with the Trustee Companies "the Dormant Companies") for anominal consideration. JBFS provides pensions consultancy and administration services to a core activeportfolio of 235 small self-administered pension scheme ("SSAS") and 55self-invested personal pension ("SIPP") clients. In addition, the JB Groupprovides third party administration services to more than 300 additional SSASand SIPP clients. North Star was established in October 2006 and subsequently authorised by theFinancial Services Authority ("FSA") to establish and operate personal pensionschemes, including SIPPs, under the new regulatory regime introduced on 6 April2007. The Dormant Companies have never traded. The JB Group has total funds under trusteeship of over £400 million and theTrustee Companies act as trustees to the pension schemes. The total consideration includes an initial payment of £1.25 million funded fromthe Group's existing cash resources and deferred consideration of up to £1.34million, of which £0.64 million will be paid in the three years followingcompletion, with the remaining payment of up to £0.70 million being determinedwith reference to an earn-out mechanism based on revenues generated during thethree years following completion. In the year ended 31 March 2007 the JB Group generated a net profit for the yearof £0.40 million before partners' salaries and drawings, on revenues of £1.37million. The JB Group's net assets at 31 March 2007 were £0.51 million. New bank facilities In January 2008 the Group renegotiated its borrowing facilities with Royal Bankof Scotland plc ("RBS"). At 30 November 2007 the RBS facilities consisted ofone overdraft facility of £2.25m with interest payable at 1.375% over the bank'sbase rate (currently 5.25%) and another £0.75m overdraft facility at 1.5% overthe bank's base rate. These facilities have been replaced by one overdraftfacility of £5.0m with interest payable at the bank's base rate plus 1.0% on thefirst £1.5m, plus 1.25% on the next £1.5m and plus 1.375% on borrowings inexcess of £3m. The RBS facility is repayable upon demand and is subject to review on at leastan annual basis. The next review date is 11 January 2009. The Group also has an overdraft facility of £0.25m provided by Lloyds TSB plc ("Lloyds TSB") with interest payable at 1.5% over the bank's base rate (currently5.25%). The Lloyds TSB facility is renewable on 31 March 2008. New property lease The private pension schemes of Ian Mattioli, Robert Woods, Nathan Imlach andMurray Smith, together with the private pension schemes of other key managementpersonnel of the Group, have a beneficial interest in MW Properties (No 60)Limited. In February 2008 the Group entered into an agreement to lease additionalpremises at The Gateway, Grove Park, Enderby from MW Properties (No 60) Limitedat an initial rent of £75,600 per annum. The lease term expires on 1 February2018. 16. Copies of interim report Copies of the interim report will be posted to shareholders in due course andare available from the Group head office at: MW House, 1 Penman Way, Grove Park,Enderby, Leicester LE19 1SY. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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