TIDMRIIG
RNS Number : 1096M
Resources In Insurance Group PLC
11 August 2011
11 August 2011
RESOURCES IN INSURANCE GROUP PLC
("RiIG", the "Group" or the "Company")
INTERIM RESULTS
Revenue up 48% and profitable
The Board of RiIG, a leading provider of claims management and
consultancy solutions to the UK insurance profession, is pleased to
announce today Interim Results for the six months to 30 June 2011,
reflective of another period of improvement and successes, and a
move into profitability.
HIGHLIGHTS
-- Revenue increased by 48% to GBP1,373,215 (2010:
GBP925,146)
-- Profitable at GBP25,382 before share option expense (2010:
loss of GBP150,466)
-- Conversion of remaining GBP200,000 convertible loan stock
-- Financed to capitalise on growing the current business and
debt free
-- Investing in talent to support business drive
-- Maintained client relationships and new business success
Commenting on the Results, Executive Chairman John French,
said:
"In the period under review, the Board has invested for growth
and scale, increased RiIG's sales capability with focus on the
untapped London market as well as the national operators. This is
all geared to an aggressive growth plan throughout 2011 and into
2012 and beyond with a focus on delivering solid services to
clients, driving new business and building on the Group's position
of profitability. The Board believe that RiIG is well funded to
capitalise on its current position."
ENQUIRIES:
Resources in Insurance Group plc
John French, Executive Chairman Mobile: 07836 722 482
Allenby Capital Ltd - nominated adviser and joint broker Tel:
+44 (0)20 3328 5656
Brian Stockbridge / Alex Price
Rivington Street Corporate Finance - joint broker Tel: +44 (0)
20 7562 3384
Dru Edmonstone
CHAIRMAN'S STATEMENT
EXECUTIVE CHAIRMAN'S STATEMENT
I am pleased to report on the Group's results and performance
for the six months to 30 June 2011, a period reflecting continued
progress and one which saw the Group move into profitability. RiIG
has seen a transformation over the last three years, moving from
losses in December 2008 of GBP1.3m to the present level of
profitability and a debt-free position. The period under review
includes days of lost revenue as a result of the high level of
public holidays.
For the six months to 30 June 2011, RiIG saw an uplift of 48% in
revenue to GBP1,373,215 (2010: GBP925,146) and a move to a profit
of GBP25,382 before share option expense (2010: loss of
GBP150,466). The Board is not recommending the payment of a
dividend.
The Group continues to grow its client portfolio and, effective
this month, has signed a major new contract with a leading insurer
taking the total number of blue chip insurance clients to
eight.
RiIG's services remain focused on the provision of Claims
Advisory Services - covering Implant, Outsource, Field Inspection,
Credit Hire and Consultancy. From RiIG's consultancy services
clients can fully identify where their processes can be improved
and where costs can be saved. RiIG provides talented and
experienced claims handlers who have a track record at achieving
these cost savings as well as improving customer relations. These
handlers can be inserted wherever and whenever required. The Board
believes that insurers need a flexible resource model in today's
world and RiIG can meet this demand.
The Board has appointed two new sales managers to support the
growing demands of retained business and new business. As the
industry faces significant challenges in terms of talent, coupled
with the rise of major retail brands entering the insurance sector
bringing with them retail standards of service and operational
efficiencies, the Board believes that now more than ever companies
will be requiring the services of companies like RiIG.
I am pleased to report a strong start to the second half of the
financial year, with the extension of two contracts and new
commissions from existing clients. The Group is well funded to
capitalise on growing the current business with an encouraging
level of new business opportunities in the pipeline. Prospects for
the remainder of the year are encouraging.
In the period under review, the Board has invested for growth
and scale, increased RiIG's sales capability with focus on the
untapped London market as well as the national operators. This is
all geared to an aggressive growth plan throughout 2011 and into
2012 and beyond with a focus on delivering solid services to
clients, driving new business and building on the Group's position
of profitability. As ever, I wish to thank our employees and
shareholders for their continued support.
John French
Chairman
11 August 2011
INDEPENDENT REVIEW REPORT TO RESOURCES IN INSURANCE GROUP
PLC
Introduction
We have been engaged by RiIG to review the condensed set of
financial statements in the half-yearly financial report for the
six months ended 30 June 2011 which comprises the income statement,
statement of changes in shareholders equity, balance sheet,
cashflow statement and the related explanatory notes. We have read
the other information contained in the half-yearly financial report
and considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set
of financial statements.
This report is made solely to the RiIG in accordance with the
terms of our engagement to assist RiIG in meeting its requirements.
Our review has been undertaken so that we might state to RiIG those
matters we are required to state to it in this report and for no
other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other RiIG for our review
work, for this report, or for the conclusions we have reached.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the AIM Rules for Companies, published by the London Stock Exchange
from time to time.
As disclosed in note 2, the annual financial statements of the
group are prepared in accordance with IFRSs as adopted by the
European Union. The condensed set of financial statements included
in this half-yearly financial report has been prepared in
accordance with International Accounting Standard 34, "Interim
Financial Reporting," as adopted by the European Union.
Our Responsibility
Our responsibility is to express to RiIG a conclusion on the
condensed set of financial statements in the half-yearly financial
report based on our review.
Scope of Review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, "Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity" issued by the Auditing Practices 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, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified 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 believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 30
June 2011 is not prepared, in all material respects, in accordance
with International Accounting Standard 34 as adopted by the
European Union and the AIM regulations.
Saffery Champness
Chartered Accountants
Lion House
Red Lion Street
London
WC1R 4GB
11 August 2011
RESOURCES IN INSURANCE GROUP PLC
CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2011
6 months 6 months
ended 30 ended 30 Year ended
June 2011 June 2010 31 December
Unaudited Unaudited 2010 Audited
GBP GBP GBP
Revenue 1,373,215 925,146 2,131,971
Administrative expenses (1,346,358) (1,064,560) (2,452,361)
Share option expense (11,894) - (52,746)
Profit/(loss) from operations 14,963 (139,414) (373,136)
Finance costs - net
Interest payable (1,475) (12,522) (30,677)
Profit/(loss) before tax 13,488 (151,936) (403,813)
Taxation 3 - 1,470 1,470
Profit/(loss) for the period 13,488 (150,466) (402,343)
Basic profit/(loss) per
share 0.00p (0.11p) (0.25p)
Diluted profit/(loss) per
share 0.00p (0.11p) (0.25p)
RESOURCES IN INSURANCE GROUP PLC
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2011
Share
Share premium Share option Retained
capital account reserve Deficit Total
GBP GBP GBP GBP GBP
Balance at 1
January
2010 2,044,062 872,841 - (3,013,504) (96,601)
Issue of
shares 44,445 145,555 - - 190,000
Loss for the
period - - - (150,466) (150,466)
Balance at
30 June
2010 2,088,507 1,018,396 - (3,163,970) (57,067)
Balance at 1
July 2010 2,088,507 1,018,396 - (3,163,970) (57,067)
Issue of
options - - 52,746 - 52,746
Issue of
shares 98,318 301,682 - - 400,000
Exercise of
options - 21,099 (21,099) - -
Loss for the
period - - - (251,877) (251,877)
Balance at
31 December
2010 2,186,825 1,341,177 31,647 (3,415,847) 143,802
Balance at 1
January
2011 2,186,825 1,341,177 31,647 (3,415,847) 143,802
Issue of
options - - 11,894 - 11,894
Issue of
shares 38,462 161,538 - - 200,000
Profit for
the period - - - 13,488 13,488
Balance at
30 June
2011 2,225,287 1,502,715 43,541 (3,402,359) 369,184
RESOURCES IN INSURANCE GROUP PLC
CONSOLIDATED BALANCE SHEET
30 JUNE 2011
31 December
30 June 2011 30 June 2010 2010
Unaudited Unaudited Audited
GBP GBP GBP
ASSETS
Non-current assets
Property, plant and equipment 29,841 31,483 26,687
Current assets
Work in progress 253 1,587 405
Trade and other receivables 542,004 419,912 573,931
Cash and cash equivalents 86,533 134,425 149,214
628,790 555,924 723,550
Total assets 658,631 587,407 750,237
EQUITY
Capital and reserves attributable
to the Company's equity
shareholders
Share capital 2,225,287 2,088,507 2,186,825
Share premium account 1,502,715 1,018,396 1,341,177
Share option reserve 43,541 - 31,647
Retained deficit (3,402,359) (3,163,970) (3,415,847)
Total equity 369,184 (57,067) 143,802
LIABILITIES
Current liabilities 289,447 344,474 406,435
Non-current liabilities - 300,000 200,000
Total liabilities 289,447 644,474 606,435
Total equity and liabilities 658,631 587,407 750,237
RESOURCES IN INSURANCE GROUP PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2011
6 months 6 months Year ended
ended ended 31 December
30 June 2011 30 June 2010 2010
Unaudited Unaudited Audited
GBP GBP GBP
Cash flows from operating
activities
Profit/(loss) from operations 14,963 (139,414) (373,136)
Adjustments for:
Depreciation of property,
plant and equipment 6,189 5,925 11,666
Loss on disposal of property,
plant and equipment - 1,246 1,540
Share option expense 11,894 - 52,746
Operating cash flows before
movements
in working capital 33,046 (132,243) (307,184)
Decrease in work in progress 152 390 1,572
Increase in receivables (198,073) (278,616) (202,635)
(Decrease)/increase in
payables (116,988) 96,412 158,373
Cash used in operations (281,863) (314,057) (349,874)
Interest paid (1,475) (12,522) (30,677)
Tax refunded - 1,470 1,470
Net cash used in operating
activities (283,338) (325,109) (379,081)
Cash flows from investing
activities
Purchase of property, plant
and equipment (9,343) (5,621) (6,860)
Net cash flows used in
investing activities (9,343) (5,621) (6,860)
Cash flows from financing
activities
Proceeds from issue of shares 230,000 190,000 260,000
Proceeds from issue of
convertible loan stock - 300,000 300,000
Net cash from financing
activities 230,000 490,000 560,000
Net (decrease)/increase in
cash and cash equivalents (62,681) 159,270 174,059
Cash and cash equivalents at
beginning of period 149,214 (24,845) (24,845)
Cash and cash equivalents at
end of period 86,533 134,425 149,214
RESOURCES IN INSURANCE GROUP PLC
NOTES TO THE INTERIM FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 30 JUNE 2011
1. Accounting Policies
Basis of accounting
The financial statements have been prepared on an historical
cost basis. The directors, based on current management information
and financial projections, have a reasonable expectation that the
Group has adequate resources to continue in operational existence
for the foreseeable future.
RiIGhas prepared detailed profit and cash flow projections;
projected gross profit margins are realistic and consistent with
past performance, the existing and anticipated pricing structure
and order book. Projected debtor collections are also realistic and
consistent with past performance. Overhead levels have been closely
considered and consistent with cost saving measures implemented
during 2010.
The Board considers the cost base to be stable, and the risk of
losing significant customers to be low, due to the nature of the
services.
There are no borrowing requirements to be considered. On 22
December 2010 the Group privately placed GBP300,000 in new shares
and converted GBP100,000 of the convertible loan notes. The
remaining GBP200,000 of convertible loan notes were converted in
two tranches of GBP100,000 each on 13 January 2011 and on 20
January 2011. The Group has no debt and is cash positive.
Cash flow projections have analysed all known liabilities,
commitments and repayment dates in the future, including the period
beyond twelve months from the date of this report. These
projections include current enacted taxation rates.
The Group's main products are considered to be robust and will
benefit from external factors such as Ministry of Justice reforms
and the poor UK winter weather in 2010. Significant new business
has not been factored into the financial projections, although
there are a number of new business contracts in negotiation.
Current market response and the conversion of potential customers
have both been good.
Projections have been tested by performing sensitivity analyses
on critical assumptions, specifically levels of activity, to ensure
sufficient levels of working capital. In these projections turnover
has been flexed to incorporate both current confirmed work and new
work expected to be won in the year.
There are additional plans in place to alter the amounts and
timing of cash flows so unexpected needs or opportunities can be
addressed. The Board has also restructured the share capital of the
Group in 2010 to fund the growth of the business and to capitalise
on the growth opportunities that may present themselves. Improved
trading, confidence from existing shareholders and current
investment market conditions give the directors confidence that
this will be achieved.
As such the directors continue to adopt the going concern basis
in the preparation of the financial statements.
RESOURCES IN INSURANCE GROUP PLC
NOTES TO THE INTERIM FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 30 JUNE 2011
1. Accounting Policies (continued)
Statement of compliance
The financial statements of Resources in Insurance Group plc and
all its subsidiaries have been prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by
the European Union.
Basis of consolidation
The consolidated financial statements incorporate the results of
the Company and all its subsidiary undertakings as if they were a
single entity. Subsidiary undertakings are consolidated from the
date of acquisition using the acquisition method of accounting.
Revenue recognition
Revenue is recognised by reference to the stage of completion of
the transaction, in accordance with IAS 18, and represents the
value of services provided in the period and is stated net of
VAT.
Property, plant and equipment
Property, plant and equipment are stated at cost less provision
for depreciation. Depreciation is provided at rates calculated to
write off the cost of each asset less its estimated residual value
evenly over its estimated useful life, as follows:
Claims software over three to five years
Office equipment and fittings over three to five years
Website development over three years
Investments
Fixed asset investments are stated at cost less provision for
diminution in value.
Work in progress
Work in progress is valued at the lower of cost and net
realisable value and is based on the percentage complete at the
year end.
Trade and other receivables
Trade and other receivables are measured on initial recognition
at fair value. When objective evidence exists that the asset is
impaired the estimated irrecoverable amount is written off to
profit and loss.
Trade and other payables
Trade and other payables are recognised initially at fair value
and subsequently measured at amortised cost using the effective
interest method.
Leasing and finance lease commitments
Assets obtained under hire purchase contracts and finance leases
are capitalised in the balance sheet and depreciated over their
useful economic lives. The interest element of the rental
obligations is charged to the profit and loss account over the
period of the contract and represents a constant proportion of the
balance of capital payments outstanding. Rentals paid under
operating leases are charged to the profit and loss account on a
straight line basis over the term of the lease.
RESOURCES IN INSURANCE GROUP PLC
NOTES TO THE INTERIM FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 30 JUNE 2011
1. Accounting Policies (continued)
Current and Deferred taxation
The current income tax charge is calculated on the basis of the
tax laws enacted or substantively enacted at the balance sheet date
in the countries where the company's subsidiaries and associates
operate and generate taxable income. Management periodically
evaluates positions taken in tax returns with respect to situations
in which applicable tax regulations is subject to interpretation
and establishes provisions where appropriate on the basis of
amounts expected to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability
method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the
consolidated financial statements. However, the deferred income tax
is not accounted for if it arises from initial recognition of an
asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither
accounting nor taxable profit or loss. Deferred income tax is
determined using tax rates (and laws) that have been enacted or
substantially enacted by the balance sheet date and are expected to
apply when the related deferred income tax asset is realised or the
deferred income tax liability is settled.
Deferred income tax assets are recognised to the extent that it
is probable that future taxable profit will be available against
which the temporary differences can be utilised.
Deferred income tax is provided on temporary differences arising
on investments in subsidiaries and associates, except where the
timing of the reversal of the temporary difference is controlled by
the group and it is probable that the temporary difference will not
reverse in the foreseeable future.
Pension costs
The Group contributes to two Group Personal Pension Schemes for
Directors and senior employees. Pension contributions are charged
to the profit and loss account as they are incurred.
Share-based payment transactions
The group operates a number of equity-settled, share-based
compensation plans. The fair value of the employee services
received in exchange for the grant of the options is recognised as
an expense. The total amount to be expensed over the vesting period
is determined by reference to the fair value of the options
granted, excluding the impact of any non-market vesting conditions
(for example, profitability and sales growth targets). Non-market
vesting conditions are included in assumptions about the number of
options that are expected to vest. At each balance sheet date, the
entity revises its estimates of the number of options that are
expected to vest. It recognises the impact of the revision to
original estimates, if any, in the income statement, with a
corresponding adjustment to equity.
The proceeds received net of any directly attributable
transaction costs are credited to share capital (nominal value) and
share premium when the options are exercised.
RESOURCES IN INSURANCE GROUP PLC
NOTES TO THE INTERIM FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 30 JUNE 2011
2. Financial Information
The financial information above does not constitute statutory
accounts within the meaning of Section 434 of the Companies Act
2006. The interim financial information has not been audited but
has been reviewed by the Company's auditors.
The interim financial statements have been prepared in
accordance with IAS 34, Interim Financial Reporting. These interim
statements have been prepared in accordance with those IFRS
standards and IFRIC interpretations issued and effective as at the
time of preparing these statements.
3. Taxation
No liability to taxation arises due to the loss incurred during
the period. At 30 June 2011 the Group had Corporation Tax losses
and unclaimed capital allowances of approximately GBP2,520,000
subject to agreement with HM Revenue and Customs.
No deferred tax asset has been recognised in respect of these
losses due to there being uncertainty as to whether sufficient
future taxable profits will be generated by the company in the near
future.
6 months 6 months
ended ended Year ended
30 June 2011 30 June 2010 31 December
Unaudited Unaudited 2010 Audited
GBP GBP GBP
Domestic current year tax
UK corporation tax - - -
Adjustment for prior years - (1,470) (1,470)
Current tax charge - (1,470) (1,470)
Factors affecting the tax charge for
the period:
Profit/(loss) on ordinary
activities
before taxation 13,488 (151,936) (403,813)
Corporation tax at 28%(June
2010: 28%) 3,777 (42,542) (113,068)
Effects of:
Expenses not deductible for
tax purposes 5,036 - 23,109
Depreciation and amortisation 1,733 614 2,333
Adjustments to previous
periods - (1,470) (1,470)
Capital allowances - (3,346) -
Unrelieved losses - 45,274 -
Other adjustments (10,546) - 87,626
Current tax credit - (1,470) (1,470)
RESOURCES IN INSURANCE GROUP PLC
NOTES TO THE INTERIM FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 30 JUNE 2011
4. Earnings per share
The earnings per share is based on the profit for the period and
the weighted average number of ordinary shares in issue and ranking
for dividend.
6 months 6 months
ended ended Year ended
30 June 2011 30 June 2010 31 December
Unaudited Unaudited 2010 Audited
GBP GBP GBP
Profit/(loss) for the period 13,488 (150,466) (402,343)
Weighted average number
of shares 314,202,041 138,480,778 162,465,262
Fully diluted average number
of shares 333,961,309 138,480,778 162,465,262
5. Share capital
6 months 6 months
ended ended Year ended
30 June 2011 30 June 2010 31 December
Unaudited Unaudited 2010 Audited
GBP GBP GBP
Allotted, called up and
fully paid:
Ordinary shares of 0.1p
each 317,496 180,716 279,034
Deferred shares of 0.1p
each 1,907,791 1,907,791 1,907,791
2,225,287 2,088,507 2,186,825
On 13th January 2011 the company issued 19,230,769 Ordinary
shares of 0.1p each for 0.52p per share in respect of the
conversion of GBP100,000 convertible loan stock.
On 20th January 2011 the company issued 19,230,769 Ordinary
shares of 0.1p each for 0.52p per share in respect of the
conversion of GBP100,000 convertible loan stock.
RESOURCES IN INSURANCE GROUP PLC
NOTES TO THE INTERIM FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 30 JUNE 2011
6. Cash and cash equivalents
6 months 6 months Year ended
ended ended 31 December
30 June 2011 30 June 2010 2010
Unaudited Unaudited Audited
GBP GBP GBP
Cash and bank balances 86,533 134,425 149,214
Bank overdraft - - -
86,533 134,425 149,214
7. Related party transactions
On 26th April 2011 the following share options were granted
:
At an exercise price of 1.25p
Gordon Vater - 2,384,740 ordinary shares of 0.1p each
John French - 1,703,385 ordinary shares of 0.1p each
Dominic Boyce - 1,703,385 ordinary shares of 0.1p each
At an exercise price of 1.75p
Gordon Vater - 2,384,739 ordinary shares of 0.1p each
John French - 1,703,385 ordinary shares of 0.1p each
Dominic Boyce - 1,703,385 ordinary shares of 0.1p each
During the period CP Adjusting Limited, a company in which Barry
Whyte is a director, was provided accounting and back office
services by the Group totalling GBP16,870. At 30 June 2011 the
Group was owed GBP3,214 by CP Adjusting Limited.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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