25th Jan 2006 07:01
Accuma Group PLC25 January 2006 Press Release 25 January 2006 Accuma Group plc PLACING/TRADING UPDATE/EGM NOTICE Accuma Group Plc ("Accuma", the "Company" or the "Group"), a leading provider ofpersonal debt advice specialising in Individual Voluntary Arrangements ("IVAs"),announces that it has conditionally raised £5 million for the Group (beforeexpenses) ("Placing") and conditionally arranged a vendor placing of 3.5 millionexisting ordinary shares by certain of the directors ("Vendor Placing") tosatisfy demand from institutional investors and increase the free float. All of the 2.5 million new ordinary shares and 3.5 million existing ordinaryshares have been placed at a price of £2.00 per share. The new ordinary sharesare expected to be admitted to trading on AiM on 20 February 2006. The net proceeds of the Placing receivable by the Group are expected to beapproximately £4.75 million which will be used to provide working capital andenable the Group to: • accelerate the increases in the number of IVA's the Group is handling; • explore new marketing and sales channels to broaden the Group's routes to market; and • make further investment in infrastructure and continue to refine its internal systems in order to PDF1maximise efficiency. In addition the Company has conditionally placed 3.5 million existing ordinaryshares at a price of £2.00 per share. Charles Howson (Chief Executive), RobertBenjamin (Marketing Director) and Nicola Roberts (Executive Director), the "Vendors" are selling, respectively, 2,865,000, 575,000 and 60,000 shares tosatisfy demand from institutional investors and to increase the free float, andhence liquidity, of the shares. The Vendors will, following the Vendor Placing,retain an interest in an aggregate of 8,372,938 ordinary shares in the Grouprepresenting 33.46 per cent. of the Company's then issued share Capital The Placing and the Vendor Placing are conditional on each other and requireshareholder approval. Holders of Ordinary Shares will be asked to approve thePlacing at an Extraordinary General Meeting to be held on 17 February 2006 at12.00hrs at the offices of Memery Crystal, 44 Southampton Buildings, London WC2A1AP. In addition the Group today releases a trading update ahead of its interimresults which are expected to be announced on 30 March 2006. Trading Highlights • Threefold growth in the number of IVA cases handled year on year • Group now trading profitably and future contracted revenue more than doubled to £11.1m. • Full year results expected to comfortably meet market expectations • Wilson Phillips acquisition performing ahead of expectations and on target to be fully integrated within the first half of 2006 • IVA capacity more than doubled as a result of the new head office facility and the appointment of additional Insolvency Practitioners ("IPs") and support staff. Charles Howson, Accuma's Chief Executive commented: "The Placing will provide the Group with the ability to fully capitalise on ourachievements to date and I have been encouraged by the strong institutionaldemand from both existing and new institutional investors. The new head officeand the appointment of further IPs will provide the springboard to take theGroup to the next stage of its development. 2005 was both a busy and successful year for Accuma as we have positionedourselves in the top tier of personal insolvency specialists. The Group operatesin a market that continues to experience significant growth and we are delightedthat we have continued to outpace the market and increase our market share. Recent enquiry levels have exceeded our previous expectations and our investmentin infrastructure and operational resources over the past few months means thatwe are well positioned to deal with this increased demand. The Board remain confident of comfortably meeting market expectations for thefull year." Wilson Phillips Accuma acquired Wilson Phillips Limited ("Wilson Phillips") at the end of August2005 and the Group is pleased to announce that its integration into the Group isproceeding very well. Wilson Phillips is benefiting considerably from being partof the Accuma Group and will be relocated to larger modern premises at the endof February 2006. This will enable us to recruit additional staff and increaseour capacity. Capacity increased The Group now employs six licensed IPs, four having been appointed sinceflotation. In addition two further IPs will start working for the Group withinthe first quarter of 2006. The Group now has the capacity to deal with 350 IVAcases a month and following the appointment of the two further IPs the Group'sIPs will be able to deal with over 500 IVA cases a month. This together withfurther operational appointments made in the period will not only allow theGroup to meet market expectations for 2006 but will allow our growth to beaccelerated going forwards. The total number of employees now stands at 129. On 25 November 2005 the Group moved its head office to City Tower, PiccadillyPlaza, Manchester. The new head office facility is over 18,000 square feet andthe Group now has sufficient office space for over 300 employees without itincurring a material increase in office costs. New IVA case numbers Accuma's run rate has increased significantly over the past year as shown below: New IVAs Monthly Case Run Rate 2004 20053 months to March 20 373 months to June 31 843 months to September 50 1263 months to December 47 186 The above figures show a threefold increase in our case run rate year on yearand a fourfold increase in the last quarter. The Group is now profitable and has increased its future contracted revenue from£5.4m at the end of July 2005 to £11.1m at the end of December 2005. Thisrevenue will have a significant positive effect on the profitability of theGroup as supervisory fees have an average 80% gross profit margin. Market continues strong growth The IVA market continues to grow at a significant pace with 2005 year on yeargrowth expected to show a near doubling of the 10,752 IVAs registered in 2004.With nearly 2,500 IVAs registered in November 2005 alone, it is predicted that2006 will see this growth continue. Consumer debt now stands at £1.14 trillion. £192 billion of which is unsecuredwith £56 billion outstanding on credit cards. Unsecured debt is forecast toincrease to over £200 billion in 2006 with a further 5-7% annual growth over thenext five years. Recent commentary would support the forecast growth in consumer credit and theIVA market. A You Gov poll in July 2005 reported that nearly 80% of an averagefamily's take home pay is required to meet living expenses. The Bank of England's Financial Stability Review (June 05) indicated thathousehold debt averages 150% of annual net income (up from 100% in 1998) andthat it is likely that debt will continue to increase more rapidly than incomeover the next few years. For further information:Accuma Group plcCharles Howson, Chief Executive Tel: +44 (0) 0161 235 [email protected] www.accumagroup.com Daniel Stewart & Company PlcTom Jenkins / Lindsay Mair / Marc Young Tel: +44 (0) 20 7776 [email protected] Media enquiries:AbchurchChris Lane / Sarah Hollins Tel: +44 (0) 20 7398 [email protected] www.abchurch-group.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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