Following my Chairman's Statement in the 2016 Annual Report and Accounts, you will be pleased to note that the out-turn for the first six months of 2017 has reverted to our previous levels of profitability by showing substantial and sustained progress throughout the Group. For this period, our profit before income tax stands at £0.9 million (2016: £0.7 million), which represents a growth of just over 30%. This increase is even more impressive if last year's non-operating items, such as a VAT recovery of £0.3 million, are stripped out. On this basis, the like-for-like operating growth is over 89%. You will recall at this time last year, our Interim profit before income tax declined by nearly 30% over the same period in 2015. Thus, it is important to understand that this year's Interim figure is a clear reflection of our current operating success, showing as it does a re-positioning of our strategic priorities and a re-focus on our core competences, with a particular emphasis on prudent new business generation and acquisition.
Equally significant are the improvements we have made to strengthen our Balance Sheet. If we look back two years to the 2015 Interim results, our total assets then stood at £126.2 million. This half, our total assets have increased to now stand at £174.3 million (2016: £149.1 million). This represents a growth of nearly 17% over the same period last year, and a growth of 34% over the equivalent 2015 figure. Taking the same three periods, our loan book has increased from £92.5 million at 2015's half-year, to a current figure of £123.5 million (2016: £111.8 million): a growth of 38% in total. During this time, our loan impairment provisions have remained steady at £0.2 million (2016: £0.2 million) for this half, and against £0.3 million in 2015, demonstrating the success of our policies of prudential lending. Cash and near-cash currently stands at £44.3 million (2016: £31.9 million), providing the liquidity for further lending opportunities as we continue to expand the regulatory capital base required to support the continuing new business growth. Finally, our total equity has increased to £14.0 million (2016: £12.8 million) as we progressively reduce our retained earnings deficit which, incidentally, stood at negative £8.0 million in 2015 and is now standing at negative £5.0 million (2016: negative £6.1 million).
Basic earnings per share are up 27% to 0.79 pence (2016: 0.62 pence) and fully diluted earnings per share are up 26% to 0.53 pence (2016: 0.42 pence). Shareholder equity at £14.0 million (2016: £12.8 million) has grown by 9%.
Turning to our principal operating subsidiaries: -
Conister Bank Limited (the "Bank")
The Bank's net interest income has increased to £8.8 million (2016: £7.5 million), a growth of 17% and is a testament to the excellence of our sales teams and a reflection of a robust new business pipeline developed over the last nine months, underpinned by steady and favourable borrowing interest rates. Yet again, our Isle of Man direct lending has beaten our expectations with a consistent monthly new business figure in excess of £1.5 million, which has continued throughout the first half and beyond. Also, our direct lending into the UK market continues to perform well, by more than trebling business underwritten from this source in the last twelve months. The combined strength of our direct business has the added advantage of helping the decrease of our reliance on the UK bulk scheme products introduced since 2014, with their onerous commission sharing arrangements and disproportionate weighting within our loan balances. The increase of 26% in operating income at £4.2 million (2016: £3.4 million) reflects the comparative stabilisation of our commission expense of £4.7 million (2016: £4.2 million) - a cost of sales which we monitor closely. We have maintained personnel expenses at £1.
MUST ADMIT their relations with private investors are pretty poor.
I expect results later in September ( they were 30.09 last year)
We have an extra million pounds of cash in the business and now 118m shares.
Last year was a poor year and I feel we should get back to close on 2 million so close to 2p eps.
Shares are far too cheap but they have been for a while. One day they may make us money.
The shares should jump on the results and maintain double figures going forward.
JM - Two loans, one of £500,000 maturing on 31 July 2017 with interest payable of 7.0% per annum, and one of £1,250,000 maturing on 26 February 2020, paying interest of 6.5% per annum. Both loans are convertible at the rate of 4 pence and 9 pence respectively. JM is also entitled to 8.3 million warrants at an exercise price of 6 pence which lapse on 31 July 2017.
BL - One loan consisting of £1,200,000 maturing on 31 July 2017 with interest payable of 7.0% per annum. Jim Mellon is the beneficial owner of BL and Denham Eke is also a director. The loan is convertible at a rate of 4 pence. BL is also entitled to 20 million warrants at an exercise price of 6 pence which lapse on 31 July 2017.
The amounts that shift the sp about are puny and indicate little.
Later on this year we will have a much better idea of the lay of the land with regards to the loans that become due and options that become eligible. The last set of results weren't exactly stella but that might all be part of the plan.
That issue is not going to get sorted out, read Jim's twitter account, he see's no issue at all with the warrants at 6p. Obviously a different perspective looking down at smaller shareholders from the boardroom. This company pays lip service to smaller shareholder interests, though maybe there will be a discount on the next book as a sopp to losing 50+ pct of the companies value over the last few years.
The board has to consider a very simple question. Why, when we are making large increases in profits every 6 months and are expanding the services we offer, do most investors either not know about us or if they do, don't trust the management with their investments?
I mean how inept do you have to be not get a report out on a date YOU choose?
That being said I'm here for the very long term and I'll console myself with yet another buying opportunity!
I think Mike they will but it just may be later.
Not a fan of August reporting as it gets lost in holidays.
Last year was very good and I can only assume by the lack of news this year has not exceeded it.
therefore a year end 1.5 to 2.00 million looks on the cards.
I still feel once the issued option mess is sorted there may well be a serious uplift here.
I know I closed my spread bet I'd had waiting for the day at 6.25! Still got the main chunk in my SIPP and I agree that 8-10p should be achievable in medium term.
It would be nice if Jim had actually mapped out a strategy on both subjects in their annual report instead of saying some words or other at the AGM that have no consequence or comeback. Might make me more believe they give a damm. The share price usually gets the old "We have a cunning plan" mention somewhere but this year they just gave up the charade. Mind you if the share price goes up this year you can guarentee it will be mentioned! See top of the bill statement in 2013's annual report. Whow 18p.. As opposed to the destruction to 9p now.
The fact is that the potential dilution is the great uncertainty in buying into this share followed by the percieved looking after their own mentality. The Neds should hang their collective heads in shame for not having the gonads to get some action on this and protect all the shareholders. They are supposed to be of such upstanding character and morals that they are the exception to the rule of Turkeys voting for Christmas. Guess human nature just gets in the way....
I'm still buying at these levels because Mr Kelly seems to have a way of running a bank that makes increasing amounts of money, eventually somebody at the top will get the idea that giving some of that back to shareholders via a dividend or share value might be a good idea.
From the 2015 Report. I assume these are the shares in Bill as the figures roughly agree.
During the year the Group was exposed to market price risk through holding available for sale financial instruments, and a financial asset carried at fair value through profit and loss. The only significant exposure relates to the financial asset carried at fair value through profit and loss, which is an equity investment stated at market value. Given the size of this holding, which was £77,000 at 31
December 2015 (2014: £47,000) the potential impact on the results of the Group is relatively small and no sensitivity analysis has been provided for the market price risk.
Important message from the Financial Conduct Authority:
Posting inside information that is not public knowledge, or information that is false or misleading, may constitute market abuse.
This could lead to an unlimited fine and up to seven years in prison.
If you have any information, concerns or queries about market abuse, click here.
The content of the messages posted represents the opinions of the author, and does not represent the opinions of Interactive Investor Trading Limited or its affiliates and has not been approved or issued by Interactive Investor Trading Limited.
You should be aware that the other participants of the above discussion group are strangers to you and may make statements which may be misleading, deceptive or wrong.
Please remember that the value of investments or income from them may go down as well as up and that the past performance of an investment is not a guide to its performance in the future.
The discussion boards on this site are intended to be an information sharing forum and is not intended to address your particular requirements.
Whilst information provided on them can help with your investment research you need to consider carefully whether you should make (or refraining from making) investment or other decisions based on what you see without doing further research on investments you are interested in.
Participating in this forum cannot be a substitute for obtaining advice from an appropriate expert independent adviser who takes into account your circumstances and specific investment needs in selected investments that are appropriate for you.