FOR RELEASE 7.00 AM 7 DECEMBER 2005
COMPASS FINANCE GROUP PLC
("Compass Finance" or "the Group")
Compass Finance is a finance broker and packager of mortgages, secured loans
and unsecured loans for clients requiring debt consolidation and financial
solutions. The Group does not lend money to customers but earns its income from
commissions and fees received primarily from third party lenders
PRELIMINARY AUDITED RESULTS FOR THE YEAR
ENDED 30 SEPTEMBER 2005
Key Points
* Group returns to profit in first two months of current year
* Benefits from strategies implemented by new management team
* Broking commissions received on �213 million loans
* Second half showed cash inflow of �0.68 million
* Compass Debt Management established
* Looking forward to the current year with confidence and optimism
Year to Period from
30 September 9 April 2003 to
30 September
2005 2004
�000 �000
Turnover 14,288 8,568
EBITDA 320 2,033
(Loss)/profit before tax and goodwill (105) 1,801
amortisation
(Loss)/profit before taxation (601) 1,524
For further information:
Compass Finance Group plc
Mike Sutcliffe (Chief Executive) 0870 950 0000
Mark Walker (Finance Director) 0870 950 0000
Beattie Financial
Brian Coleman-Smith / Nia Thomas 020 7053 6400
COMPASS FINANCE GROUP PLC
("Compass Finance" or "the Group")
PRELIMINARY AUDITED RESULTS FOR THE YEAR
ENDED 30 SEPTEMBER 2005
Chairman's Statement
Introduction
Our first full year as a public company has been very eventful. In response to
the disappointing trading performance in the earlier part of the year, a number
of senior management changes were made. These changes followed the appointment
of Mike Sutcliffe as Chief Executive in May and we are already seeing the
benefits from the strategies being implemented by the new management team.
Comparative Figures
Compass Finance was incorporated on 9 April 2003. On 8 March 2004, the Group
acquired the entire issued share capital of Compass Finance Limited and, on the
same date, was admitted to AIM and commenced trading. Comparative figures in
these financial statements only include, therefore, the results for the period
from 8 March 2004 to 30 September 2004.
Statutory Results
For the year to 30 September 2005, the Group reported turnover of �14.29
million (period ended 30 September 2004: �8.57 million) and a loss before
taxation of �0.60 million (period ended 30 September 2004: profit before
taxation of �1.52 million). The following table presents the earnings before
taxation and depreciation (EBITDA) for the relevant periods:
Year to Period from
30 September 9 April 2003 to
2005 30 September 2004
�000 �000
Turnover 14,288 8,568
Administrative costs 13,968 6,535
-------- --------
EBITDA 320 2,033
Depreciation/amortisation 698 374
-------- --------
(Loss)/profit before interest and (378) 1,659
taxation
Interest (223) (135)
-------- --------
(Loss)/profit before taxation (601) 1,524
-------- --------
The basic and diluted loss per share for the year amounted to 0.82p (period
ended 30 September 2004: earnings per share of 1.46p).
In the year to 30 September 2005, the Group received broking commission on
funds of �213 million which were lent to customers by a number of lenders
(period ended 30 September 2004: �115 million).
Net debt at 30 September 2005 was �2.96 million resulting in gearing of 48%.
The net asset value of the Group as at 30 September 2005 was �6.09 million.
Dividends
In view of the financial performance for the year, the Board does not believe
it is appropriate to declare a dividend to shareholders. However, the Board
confirms its intention to implement a progressive dividend policy in the
future, subject to the Group's performance.
Board Changes
In May 2005, following a strategic review of the Group's business, we were
pleased to announce the appointment of Mike Sutcliffe as the new Chief
Executive. Mike was previously on the management board of CitiFinancial Europe
Plc, a member of Citigroup Inc and prior to that had spent 8 years with
Household International Inc, now a subsidiary of HSBC.
On 23 September 2005, we reported that the business had completed a full senior
management restructuring, with the appointment to the Board of Mark Walker as
Finance Director and Mark Snape as Sales and Operations Director.
Mark Walker is a chartered accountant, having trained with Price Waterhouse,
and has spent the last 8� years working with a number of venture capital
companies and other stakeholders handling a variety of corporate transactions.
He was Finance Director at a �30 million management buy-out speciality
chemicals business which was sold to a quoted US business in 2001. After
heading up the business integration process, he was headhunted to join an �85
million management buy-out of a global speciality paper manufacturer.
Mark Snape has held senior positions with a number of financial services
organisations, most recently on the management board of CitiFinancial Europe
Plc and previously as Chief Operating Officer of Firstplus, the Barclays Bank
subsidiary specialising in the secured loans market.
In addition, Mark Cawood was appointed as marketing director responsible for
overseeing the marketing function of the business, with particular emphasis on
developing a multi-channel marketing strategy, aimed at increasing response
rates and core business lead volumes. Mark has previously held senior marketing
positions, most recently as head of marketing for CitiFinancial Europe Plc,
principal consultant for PricewaterhouseCoopers and marketing director at HFC
Bank, the UK subsidiary of US finance company Household International Inc.
Current Trading and Prospects
Trading since the 30 September 2005 has been encouraging with the first two
months of the new financial year showing a return to profit in line with
management's expectations, as indicated in your Chief Executive's report below.
On behalf of the Board, I would like to take this opportunity of thanking all
employees for their dedication and commitment in what was a difficult year for
the Group.
With the new senior management team now established, this is an exciting time
for the Group, its employees and its shareholders and the Board remains
confident about the Group's long-term potential.
Gren Folwell
Non-Executive Chairman
6 December 2005
Chief Executive's Statement
Summary performance
The year under review has been a transitional one for Compass Finance in which
the business has undertaken a restructuring of the senior management team,
relocated premises to accommodate strategic growth plans and managed its way
through new FSA regulations for mortgage and general insurance sales.
Turnover for the year grew to �14.3 million and generated an EBITDA of �0.32
million, resulting in a loss before tax of �0.6 million. Whilst 2005 has seen
an uplift in turnover, profitability was impacted by investment made in new
premises, the additional cost of mortgage and general insurance regulation,
investment in new mortgage sales teams and uplifts in marketing activity. These
investments have positioned the business in readiness for a more regulated and
competitive market. Whilst the first half of the year ended 30 September 2005
saw a net cash outflow from operations of �0.87 million, the second half saw a
net cash inflow of �0.68 million as a result of improved financial controls and
the actions of the new senior management team.
Improved underlying operational indicators demonstrate that the business is now
in a strong position to return to a pattern of profits growth in both the
current year and beyond. The business has seen a marked increase in both its
core business divisions, with mortgage and secured loan sales and pipeline
volumes in-line with management expectations to achieve internal budgets.
Board Changes
I am delighted that in September 2005 the senior management restructure was
completed, with the appointments to the Board of Mark Walker as Finance
Director and Mark Snape as Sales and Operations Director.
In addition, the senior management team has been further strengthened with the
appointment of Mark Cawood as marketing director. Mark's appointment is a
direct result of the shift towards more segmented and targeted marketing
approaches to new customer acquisition and maximising existing customer
opportunities.
These key appointments demonstrate the appetite of the Group for continued
earnings growth through a combination of organic growth, as well as
diversification into new markets, facilitated by attracting the highest calibre
people into the business.
Strategy
Having completed a strategic review of the business and a review of the market
place in which we operate, there are clearly opportunities for us to diversify
into related financial services markets, as well as to gain greater market
share within our current markets.
The core brokerage divisions have stabilised and have now returned to growth.
To ensure this growth continues and improves, we will broaden our presence into
new segments of the mortgage and secured loan markets.
Diversification into related markets will be a key feature of our strategy
moving forward. As a business we have a responsibility to offer appropriate
financial solutions to all applicants. This leads to a natural affinity with
helping customers who are experiencing debt problems and are looking for help
and guidance to resolve these problems, yet are unable to find a solution.
Through the development of a best advice model, facilitated by having the right
expertise and product set, we aim to be able to offer a financial solution to
all our customers.
Marketing
Through the restructured management team and a deeper understanding of its
markets and customers, Compass Finance is now positioned to broaden its market
penetration. Traditionally, the business has concentrated on the sub-prime
market for mortgages and secured loans. Whilst this segment will remain central
to our business, throughout 2006 we will enter the medium adverse and
near-prime segments of the market, opening up an additional 4 million potential
new customers.
In order that lead volumes continue to increase in line with expectations, the
business will focus on lead generation through a more integrated marketing
approach, utilising a multitude of marketing tactics. Historically, the
business has focused its marketing efforts on direct mail, a medium that will
continue to be used. However, other media such as direct response television,
radio and press will become key components of the integrated marketing strategy
being deployed. Added to this will be the launch of our new website, driven by
enhanced functionality and content, targeted at offering customers a fast,
efficient service to meet their financial needs. These new channels will allow
the business to meet its strategic goals to diversify into new markets, whilst
protecting growth in the core business divisions.
As we move through 2006, our drive to generate core leads will see Compass
Finance continue to penetrate deeper into the affinity lead market. Work
recently commenced on attracting high street mortgage and secured loan lead
providers, work that is now crystallising into increased lead volumes.
Operations
During the year under review, a restructuring was completed of the middle
management and core sales and processing functions. The people and process
changes implemented have seen operational efficiencies continue to improve in
the latter part of 2005. Sales and completion metrics now exceed those
delivered historically and continue to increase.
In late 2005, we established a new business labelled Compass Debt Management.
Whilst still in its infancy, the operation is already positively contributing
to the revenues of the Group and is well placed to become a significant
contributor in the future.
Information Technology
Work has now been completed on the design of an IT infrastructure capable of
delivering efficient processing in a diversified business. As we move into new
markets our IT capability is key to our success, allowing us to provide
excellent service to our customers as well as opening new distribution channels
to service a diverse product set and broader market place.
Throughout 2006, we will implement our new systems infrastructure, adding
enhanced web functionality and improved operational processes and accommodating
new business divisions and products. These systems will create efficiencies in
processing as well as facilitating the start of our drive to implement a CRM
strategy, thereby developing longer term relationships with our customers.
Employees
I would like to take this opportunity to thank all of our employees for their
hard work, dedication and commitment over the past year. The quality and
calibre of our employees has been, and continues to be, the key driver behind
our return to profitable growth.
In 2006, we will continue to recruit and build a workforce based on talent.
Whilst it is anticipated that we will add to the numbers of employees, any
increase will be controlled in line with revenue and profit growth
expectations. Employee numbers will increase at a lower rate than our revenue
growth as we continue to leverage efficiencies gained from sales and process
improvements, as well as enhanced systems.
2006 Outlook
As a business we look forward to 2006 with optimism and confidence. Compass
Finance has now restructured in readiness for capturing a greater share of its
existing market and for entering new markets.
The underlying performance indicators demonstrate that the business is
currently performing in line with budget. Our core business has returned to
profitability and our diversification into related markets has already begun.
Early signs are that these new markets will contribute significantly to our
income growth in 2006 and beyond. Against this background, I look forward to
updating shareholders further at the Annual General Meeting in February which
will be held at our new head office in Bury.
Mike Sutcliffe
Chief Executive
6 December 2005
Compass Finance Group plc
Consolidated Profit and Loss account
for the year ended 30 September 2005
Note Year ended Period from
30 September 9 April 2003 to
2005 30 September
2004
�000 �000
Turnover 14,288 8,568
Administrative expenses (14,666) (6,909)
Operating (loss)/profit 2 (378) 1,659
Interest receivable and similar income 29 14
Interest payable and similar charges (252) (149)
(Loss)/profit on ordinary activities (601) 1,524
before taxation
Tax on (loss)/profit on ordinary 49 (547)
activities
(Loss)/profit on ordinary activities (552) 977
after taxation
Dividends 0 (100)
Retained (loss)/profit (552) 877
Earnings per share - basic and diluted 3 (0.82p) 1.46p
All of the above transactions relate, in the current year, to continuing
operations and, in the prior period, to acquisitions.
Consolidated statement of total recognised gains and losses
for the year ended 30 September 2005
There were no other gains and losses in the year other than those reported in
the consolidated profit and loss account above.
Compass Finance Group plc
Consolidated Balance Sheet
as at 30 September 2005
Note 2005 2005 2004 2004
�000 �000 �000 �000
Fixed assets
Intangible assets 9,134 9,631
Tangible assets 686 377
9,820 10,008
Current assets
Debtors 4 1,324 1,311
Cash at bank and in 240 1,450
hand
1,564 2,761
Creditors: amounts 5 (2,312) (2,520)
falling due within one
year
Net current (748) 241
(liabilities)/assets
Total assets less 9,072 10,249
current liabilities
Creditors: amounts 6 (2,962) (3,598)
falling due after more
than one year
Provisions for (20) (9)
liabilities and charges
Net Assets 6,090 6,642
Capital and reserves
Called up share capital 335 335
Share premium 5,430 5,430
Profit and loss account 325 877
Equity shareholders' 6,090 6,642
funds
Compass Finance Group plc
Consolidated cash flow statement
for the year ended 30 September 2005
Year ended 30 Period from
September 2005 9 April 2003 to
30 September
2004
�000 �000
Net cash inflow from operating 432 1,768
activities
Return on investments and servicing (219) (114)
of finance
Taxation (339) (757)
Capital expenditure (67) 29
Acquisitions - (6,125)
Equity dividends paid (100) -
Net cash outflow before financing (293) (5,199)
Financing (917) 6,649
(Decrease)/increase in cash in the (1,210) 1,450
period
Reconciliation of net cash flow to movement in net debt
for the year ended 30 September 2005
Year ended 30 Period from
September 2005 9 April 2003 to
30 September 2004
�000 �000
(Decrease)/increase in cash in the period (1,210) 1,450
Cash outflow/(inflow) from change in debt 917 (3,385)
Changes in net debt resulting from cash (293) (1,935)
flows
Finance leases acquired with subsidiary 0 (193)
New finance leases (453) (84)
Net debt at beginning of period (2,212) -
Net debt at end of period (2,958) (2,212)
Compass Finance Group plc
Notes to the Preliminary Statement
1 Basis of the Preliminary Statement
The financial information set out in this Preliminary Statement has been
prepared on the same basis as that used for the statutory accounts for the
period to 30 September 2004 and in accordance with applicable UK accounting
standards. It does not, however, constitute the statutory accounts for the year
ended 30 September 2005 but is derived from those accounts. The statutory
accounts for the year ended 30 September 2005 will be delivered to the
Registrar of Companies in due course. The auditors have reported on the
statutory accounts for the year ended 30 September 2005 and their opinion is
unqualified on these financial statements.
2 Operating (loss)/profit
Period from
Year ended 30 9 April 2003 to
September 2005 30 September 2004
�000 �000
The operating (loss)/profit is stated after
charging:
Depreciation 202 97
Amortisation of goodwill 496 277
3 Earnings per share
The calculation of earnings per share is based on the loss of �552,000 (period
ended 30 September 2004 profit of �977,000). The calculation of basic earnings
per share is based on a weighted average number of ordinary shares in issue
during the year to 30 September 2005 (and the period ended 30 September 2004)
of 66,949,792. There is no difference between the basic and diluted earnings
per share as the share options in existence at 30 September 2004 lapsed, and no
additional options were issued, during the year.
4 Debtors: amounts falling due within one year
2005 2004
�000 �000
Trade debtors 503 345
Corporation tax 15 0
Prepayments and accrued income 806 966
1,324 1,311
5 Creditors: amounts falling due within one year
2005 2004
�000 �000
Bank loan 738 682
Obligations under hire purchase contracts and 165 49
finance leases
Trade creditors 563 495
Taxation and social security 189 142
Corporation tax 0 386
Accruals and deferred income 324 433
Deferred purchase consideration 333 333
2,312 2,520
6 Creditors: amounts falling due after more than one year
2005 2004
�000 �000
Bank loan 2,079 2,818
Obligations under hire purchase contracts and 216 113
finance leases
Deferred purchase consideration 667 667
2,962 3,598
END
Pembridge Resources (LSE:PERE)
Gráfico Histórico do Ativo
De Jun 2024 até Jul 2024
Pembridge Resources (LSE:PERE)
Gráfico Histórico do Ativo
De Jul 2023 até Jul 2024
