Integrated Asset Man: Interim Results - Replacement | Company Announcements

Thursday 24 September, 2009

Integrated Asset Man

Interim Results - Replacement

RNS Number : 6000Z

Integrated Asset Management PLC

24 September 2009

The Interim Results announcement released at 10:40am under RNS Number 5982Z was issued incorrectly under the company name Lombard Risk Management. The announcement should have been released under the correct company name of Intergrated Asset Management plc.

The full text shown below remains unchanged.

Integrated Asset Management plc

Interim Results for the six months to 30 June 2009

London, 24 September 2009 - Integrated Asset Management plc ('Integrated' or the 'Company'), the AIM-listed fund of hedge fund manager and the owner of one of Italy's leading institutional brokerage firms, today announces its interim results for the six months to 30 June 2009.

Financial Highlights

	30 June 2009	30 June 2008	Change
Asset under Management	$0.85bn	$2.40bn	-65%
Net Fund Management Income	£0.93m	£1.45m	-36%
Net Brokerage Income	£1.98m	£2,94m	-33%
Loss before Tax from Continuing Operations*	£(0.84)m	£(0.60)m	-40%
Cash†	£7.92m	£11.01m	n/a
Adjusted Earnings per Share‡	(2.06)p	(1.51)p	-36%

All figures above relate to continuing operations with the exception of :

i) Assets under Management, and

ii) Cash where the balance for 30 June 2009 excludes both balances held by Altigefi and the proceeds from Altigefi's disposal whereas the comparative includes Altigefi

*stated before amortisation of intangible assets arising on consolidation and share-based payment expense

†excluding cash held by the Employee Benefit Trust

‡calculated on earnings from continuing operations before amortisation of intangible assets arising on consolidation and share-based payment expense on a diluted basis

Operational Highlights

Completion of sale of a substantial part of the hedge fund business

Healthy and liquid balance sheet

Strong focus on brokerage division

Commenting on the results, Emanuel Arbib, Chief Executive Officer, said:

'Further to last week's announcement of the completion of the sale of a substantial part of our hedge fund business to Sal.Oppenheim France, we are pleased to report that both our operating subsidiaries are now trading profitably at the operating level. This is the result of our efforts over the last 15 months to drastically reduce our cost base to keep it in line with revenues.

Both our operating divisions can be scaled up significantly in the short term through a combination of organic and acquisitive growth. Our balance sheet remains strong and liquid and we consider ourselves well positioned to take advantage of both improvements in market conditions and corporate opportunities as they arise.'

For further information, please contact:

Emanuel Arbib, Chief Executive Officer, Integrated Asset Management

Tel +44 (0)20 7514 0540 - email: arbib@integratedam.com

John Riddell, Noble Group

Tel +44 (0)20 7763 2200 - email: john.riddell@noblegp.com

Note to Editors:

Integrated Asset Management plc is an alternative investment group listed on the Alternative Investment Market of the London Stock Exchange under the symbol IAM. Integrated Asset Management's core businesses are asset management, and institutional brokerage. Further information can be found at www.integratedam.com

Chairman and Chief Executive's Statement

We are pleased to report that Integrated completed the previously announced disposal of its 51% stake in Altigefi and certain German fund management contracts on 17 September 2009. The operating results of these businesses are therefore consolidated within the Group until that date. However, in preparing these interim results for the six months to 30th June 2009 we have also disclosed them separately as discontinued operations in the Consolidated Income Statement.

Turnover from continuing activities for the six months to 30 June 2009 decreased by 34% to £4.1 million (June 2008: £6.2 million) and the loss on continuing activities before tax and amortisation of intangible assets arising on consolidation and share based payment expense from continuing operations increased to £0.84 million (June 2008: £0.60 million), giving EPS adjusted on the same basis of (1.99)p (June 2008: (2.03)p).

The primary reason for the decrease in both turnover and profit before tax is the reduction in assets under management for our funds business between the comparative periods. In addition market conditions and the credit drought have not provided a favourable environment for our IFP brokerage subsidiary which has recorded somewhat lower revenues and earnings for the period.

Fund Management

While the last twelve months have been extremely challenging for most businesses, the hedge fund community has been hit harder than most by the panic that followed the events of September 2008. The uncontrolled selling and desperate flight to the safety of cash and government bonds has given rise to an unprecedented wave of redemptions which picked up speed further in December in the wake of the Madoff affair.

During the summer of 2008, soon after the Bear Stearns rescue, it became clear that we were entering tough times and we started to plan accordingly. We did this in two ways: first we started to aggressively manage our cost base, which peaked in the spring of 2008; second, we started to engage with Sal.Oppenheim in discussions which led to the agreement signed in April of this year to sell our 51% stake in Altigefi as well as several German fund management contracts to Sal.Oppenheim France. We are pleased that we have now achieved both of our contingency objectives and are now in a position to take advantage of the opportunities that the ravaged market of 2008 has produced. In the meantime, we are continuing to manage our cost base conservatively both at the holding company and subsidiary levels.

Although markets have improved in the last several months, in common with most of our fund of hedge fund peer group, we have had to manage the heavy flow of redemption requests coupled with liquidity issues in some of the constituent funds of our portfolios. To treat all investors fairly, this has led in some cases to the need to impose gates, create side pockets and in certain cases effect a restructuring of the fund as well.

The high cash levels that had to be kept in most portfolios to meet potential continued redemption requests diluted somewhat the strong performance of most of the constituent funds of our portfolios but despite these very high cash levels, sometimes approaching 50% of NAV, all our funds have reported respectable positive returns.

Assets under management are analysed between the following products and mandates:

	30 June 2009	31 December 2008	30 June 2008
	US$ millions	US$ millions	US$ millions
Total discretionary portfolios	731	1,095	2,004
Non-discretionary portfolios	17	33	53
Other assets under advice	98	87	345
Total AUM	846	1,215	2,402

Included within discretionary portfolios above are US$507 million of AUM that were part of the business that was disposed of on 17 September 2009.

Of the remaining $224 million of discretionary AUM, which primarily relate to the restructured Integrated Multi Strategy and Strategic Funds, approximately $120 million is committed until April 2010.

After the events that took place in financial markets--and in the hedge fund space in particular--in 2008, at the end of the year Integrated embarked on a strategic review to determine an appropriate investment, business and client-service model and for the now prevailing conditions in the hedge fund arena. While the markets have recovered a lot of ground and some confidence, we are under no illusions that things have changed for good. We firmly believe that the future of our industry lies in getting back to where it all began: namely having and being able to demonstrate an in-depth and ongoing understanding of managers. This requires special analytical skills and independence. In addition, we believe there will be a long term move towards enhanced transparency and a much better alignment of liquidity terms.

To this end, on 14 September 2009, we entered into a strategic alliance with AlvineClontarf to combine our respective investment teams and provide our clients with first class analysis and research.

We believe that over the next 6-9 months the window to raise new funds will open again, and we are working to have an efficient team in place to be able to cater for these new buyers who are, we think, likely to be more institutional and sophisticated than before.

Financial Summary

Fund Management Income

Net management fee income from continuing operations decreased to £0.93 million (June 2008: £1.45 million). Net management fees are affected solely by the levels of assets under management and the levels of retrocessions and rebates to distributors and intermediaries. There were no material changes to yields on assets under management from those disclosed in the Business Review of the 2008 Annual Report and the decrease is purely a reflection of lower levels of AUM. For future periods, some yields may decrease where fees charged to funds have decreased, albeit temporarily, as a result of the restructuring of the fund.

Not surprisingly performance fee income has been negligible as the negative performance of the second half of 2008 has reduced the valuation of funds below their high water mark and consequently performance fees do not accrue despite positive performance for the period.

Brokerage

Total Net Brokerage income decreased to £1.9 million (June 2008: £2.9 million), as shown in the table below:

	30 June 2009 £'000s	30 June 2008 £'000s
Net Brokerage	1,567	2,498
Net Marketing	379	434
Other	35	8
Total Net Brokerage	1,981	2,940

This drop in net turnover is largely attributable to the decline in income suffered by our equity and equity derivatives desks as reported in our 2008 results, which pattern has continued into 2009. The effects of the credit crunch have meant that many banking institutions have been avoiding dealing with each other for a large part of the first six months of this year. This has led to reduced volumes and brokerage activity. We have addressed this reduction in revenues by cutting our cost base, with benefits that will be visible in the second half of the year. The largest cost cutting we have done is the closure of our Lugano office whose operations are now consolidated with those of our Milan office.

Net turnover from the other three areas of activity has in fact increased with our bond desk performing particularly strongly. We are planning to invest in the successful desks and have already begun to hire new brokers coming from banking institutions that have closed or curtailed their trading activities in these areas.

Net marketing income is largely derived from the marketing and promotion of Sal. Oppenheim's products in Italy. The existing contract expires at the end of 2009 and is not currently expected to be renewed.

Operating costs

We have continued to reduce operating costs throughout the period across all areas of the Group's activities although some such reductions come with an initial cost of their own and the benefit is not necessarily achieved until later. We strive to maintain the balance of providing high quality investment management services, operating systems and controls appropriate to a listed group with its regulated subsidiaries against a regime of minimising operating expenditure. We are also mindful of the need to reward and motivate our staff appropriately.

Other non-cash income and expense

The charge for amortisation of intangible assets arising on consolidation for the year to 31 December 2008 was calculated with reference to the expected proceeds from the disposal, an element of which in turn was calculated with reference to Integrated's share price. The rise in Integrated's share price between the time of the announcement of the disposal and its completion on 17 September 2009 has caused a reversal of part of that charge of £1.2 million before adjustment of deferred tax and the net income of £0.8 million is included within the profit for the period from discontinued operations.

Balance Sheet

The Group balance sheet at 30 June 2009 showed cash, excluding balances held by the Employee Benefit Trust, of £7.9 million against balances of £11.0 million and £11.0 million at 30 June and 31 December 2008 respectively. However reported cash balances at 30 June 2009 exclude those balances held for disposal whereas the comparatives include it.

More importantly, current cash balances inclusive of the gross sale proceeds of Eur3.5 million and the ordinary cash flows between 30 June 2009 to date are in excess of £10.6 million and £9.4 million net of short term borrowing.

Post Balance Sheet Event

As already announced and referred to above, the disposal of our 51% stake in Altigefi S.A. and certain fund management contracts completed on 17 September 2009. This has affected our balance sheet in three ways.

Firstly we gained permission from the Court to carry out a capital reduction and on completion of the deal were able to cancel Sal. Oppenheim's shareholding. This cancellation has reduced the number of shares in issue by 11,496,111 shares to a new total of 30,651,386 shares, effectively increasing net assets per share by 37%.

Secondly we received gross proceeds of Eur3.5 million in cash on 17 September as noted above.

Thirdly we also gained permission from the Court for a Reduction in the Share Premium Account such that this account is eliminated and applied to Retained Earnings and the Group now has positive distributable reserves.

Outlook

A year on from the collapse of Lehman, the industries in which we operate are rather more stable as a result of central bank interventions but the outlook is still uncertain. The Board remains committed to the management of costs in line with the levels of activity of our underlying businesses. We expect operating expenditure for the second half of 2009 to be significantly lower than that reported for the first half although it is too early to predict whether the group will return to profitability in this period. This remains our goal for both businesses.

Our balance sheet is strong and liquid and we are well positioned to take advantage of improvements in market conditions and corporate opportunities as they arise. We are actively considering a number of such opportunities at present and will keep shareholders in touch with any developments.

John Booth Emanuel Arbib

Chairman Chief Executive

23 September 2009

Consolidated Income Statement
for the six months ended 30 June 2009
					Unaudited	Unaudited
					Six months to 30 June 2009	Six months to 30 June 2008	Year to 31 December 2008
				Note	£000s	£000s	£000s

Continuing operations
Revenue					4,086	6,205	10,428
Cost of sales					(1,177)	(1,819)	(3,143)
Net revenue					2,909	4,386	7,285
Operating costs					(3,762)	(5,155)	(11,005)
Amortisation of intangibles					(6)	-	(13)
Share-based payments cost					(42)	(67)	(32)
Operating loss before impairment of goodwill and intangibles					(901)	(836)	(3,765)
Impairment of goodwill and intangibles					-	-	(380)
Operating loss					(901)	(836)	(4,145)
Finance income					44	208	385
Finance expense					(35)	(41)	(82)
Loss before taxation					(892)	(669)	(3,842)
Taxation				3	(23)	(50)	13
Loss from continuing operations					(915)	(719)	(3,829)
Discontinued operations
Profit/(loss) for the period from discontinued operations				4	921	113	(14,117)
Profit/(loss) for the period					6	(606)	(17,946)

Attributable to :
Continuing operations
Owners of the parent					(915)	(702)	(3,829)
Non controlling interests					-	(17)	-
					(915)	(719)	(3,829)
Total
Owners of the parent					35	(805)	(18,249)
Non controlling interests					(29)	199	303
					6	(606)	(17,946)
Earnings per share
Continuing operations
Basic				5	(2.17)p	(1.67)p	(9.11)p
Diluted				5	(2.17)p	(1.67)p	(9.11)p
Total
Basic				5	0.08p	(1.92)p	(43.42)p
Diluted				5	0.08p	(1.92)p	(43.42)p



Consolidated Statement Of Comprehensive Income
for the six months ended 30 June 2009
					Unaudited	Unaudited
					Six months to 30 June 2009	Six months to 30 June 2008	Year to 31 December 2008
					£000s	£000s	£000s

Profit/(loss) for the period					6	(606)	(17,946)
Currency translation differences on overseas operations					(289)	648	2,523
Deferred tax on share options					-	(31)	(77)
Total comprehensive income for the period					(283)	11	(15,500)

Total comprehensive income attributable to :
Owners of the parent					(254)	(188)	(15,803)
Non controlling interests					(29)	199	303
					(283)	11	(15,500)


Consolidated Statement Of Financial Position
as at 30 June 2009
					Unaudited	Unaudited
					As at 30 June 2009	As at 30 June 2008	As at 31 December 2008
				Note	£000s	£000s	£000s

Assets
Non-current assets
Intangible assets				6	1,636	17,945	4,300
Property, plant and equipment					501	729	739
Financial assets					107	152	139
					2,244	18,826	5,178
Non-current assets held for sale and disposal group					3,768	-	-
					6,012	18,826	5,178
Current assets
Trade and other receivables				7	8,679	53,936	5,328
Cash and cash equivalents				8	7,983	12,615	11,062
Financial assets					-	78	-
					16,662	66,629	16,390
Assets held for sale and disposal group					3,032	-	-
					19,694	66,629	16,390
Total assets					25,706	85,455	21,568

Liabilities
Non-current liabilities
Borrowings				9	-	-	-
Deferred tax liabilities				10	(1,036)	(838)	(697)
Trade and other payables				11	-	-	-
					(1,036)	(838)	(697)
Current liabilities
Borrowings				9	(1,153)	(1,071)	(1,309)
Trade and other payables				11	(8,775)	(53,342)	(4,849)
Tax payable					(10)	(154)	(24)
					(9,938)	(54,567)	(6,182)
Liabilities directly associated with the disposal group					(460)	-	-
					(10,398)	(54,567)	(6,182)
Total liabilities					(11,434)	(55,405)	(6,879)
Net assets					14,272	30,050	14,689

Equity
Called up share capital				12	2,107	2,100	2,107
Share premium account					27,025	26,844	27,025
Shares to be issued					-	228	-
Share options reserve					260	438	313
Exchange difference reserve					2,658	1,071	2,946
Investment in own shares					(2,519)	(2,519)	(2,519)
Retained earnings					(16,536)	738	(16,667)
Equity attributable to owners of the parent					12,995	28,900	13,205
Equity attributable to non controlling interests					1,277	1,150	1,484
Total equity					14,272	30,050	14,689

All of the non controlling interests relate to the net assets disclosed as held for sale.


Consolidated Statement of Changes in Shareholders' Equity
for the six months ended 30 June 2009
	Share Capital		Share Premium	Retained Earnings	Other Reserves	Non controlling Interests	Total
	£000s		£000s	£000s	£000s	£000s	£000s
Unaudited
Balance at 1 January 2009	2,107		27,025	(16,667)	740	1,484	14,689

Currency translation adjustments	-		-	-	(289)	-	(289)
Deferred tax on share options	-		-	-	-	-	-
Net expense recognised directly in equity:	-		-	-	(289)	-	(289)
Profit for the period	-		-	35	-	(29)	6
Total comprehensive income/(expense) for the period	-		-	35	(289)	(29)	(283)

Conversion of loan notes	-		-	-	-	-	-
Shares issued on acquisition	-		-	-	-	-	-
Deferred consideration	-		-	-	-	-	-
Share-based payments	-		-	-	44	-	44
Cancelled/forfeited share options	-		-	96	(96)	-	-
Purchase of own shares by EBT/ESOT	-		-	-	-	-	-
Dividend paid to non controlling interests	-		-	-	-	-	-
Movement in non controlling interests	-		-	-	-	(178)	(178)
Balance 30 June 2009	2,107		27,025	(16,536)	399	1,277	14,272


	Share Capital		Share Premium	Retained Earnings	Other Reserves	Non controlling Interests	Total
	£000s		£000s	£000s	£000s	£000s	£000s
Unaudited
Balance at 1 January 2008	2,083		26,527	1,472	(1,378)	1,203	29,907

Currency translation adjustments	-		-	-	648	-	648
Deferred tax on share options	-		-	(31)	-	-	(31)
Net (expense)/income recognised directly in equity:	-		-	(31)	648	-	617
Loss for the period	-		-	(805)	-	199	(606)
Total comprehensive (expense)/income for the period	-		-	(836)	648	199	11

Conversion of loan notes	16		295	-	-	-	311
Shares issued on acquisition	1		22	-	(23)	-	-
Deferred consideration	-		-	-	-	-	-
Share-based payments	-		-	-	67	-	67
Cancelled/forfeited share options	-		-	102	(102)	-	-
Purchase of own shares by EBT/ESOT	-		-	-	6	-	6
Dividend paid to non controlling interests	-		-	-	-	-	-
Movement in non controlling interests	-		-	-	-	(252)	(252)
Balance 30 June 2008	2,100		26,844	738	(782)	1,150	30,050


	Share Capital		Share Premium	Retained Earnings	Other Reserves	Non controlling Interests	Total
	£000s		£000s	£000s	£000s	£000s	£000s

Balance at 1 January 2008	2,083		26,527	1,472	(1,378)	1,203	29,907

Currency translation adjustments	-		-	-	2,523	-	2,523
Deferred tax on share options	-		-	(77)	-	-	(77)
Net income/(expense) recognised directly in equity:	-		-	(77)	2,523	-	2,446
Loss for the period	-		-	(18,249)	-	303	(17,946)
Total comprehensive (expense)/income for the period	-		-	(18,326)	2,523	303	(15,500)

Conversion of loan notes	16		295	-	-	-	311
Shares issued on acquisition	1		21	-	(22)	-	-
Deferred consideration	7		182	-	(229)	-	(40)
Share-based payments	-		-	-	33	-	33
Cancelled/forfeited share options	-		-	187	(187)	-	-
Purchase of own shares by EBT/ESOT	-		-	-	-	-	-
Dividend paid to non controlling interests	-		-	-	-	(338)	(338)
Movement in non controlling interests	-		-	-	-	316	316
Balance 31 December 2008	2,107		27,025	(16,667)	740	1,484	14,689


Consolidated Cash Flow Statement
for the six months ended 30 June 2009
					Unaudited	Unaudited
					As at 30 June 2009	As at 30 June 2008	As at 31 December 2008
					£000s	£000s	£000s

Cash flows from operating activities
Cash generated/(used) from operations					(940)	691	(519)
Income tax received/(paid)					146	(549)	(947)
Net cash generated/(used) from operating activities					(794)	142	(1,466)
Cash flows from investing activities
Purchase of property, plant and equipment					(6)	(104)	(182)
Purchase of other financial assets					-	(29)	(55)
Sale of current financial assets					-	113	113
Non controlling interests/subsidiaries acquired					-	(27)	(48)
Interest received					81	262	485
Net cash generated/(used) in investing activities					75	215	313
Cash flows from financing activities
Redemption of unsecured loan notes					-	(783)	(783)
Dividend paid to non controlling shareholders					-	(337)	(338)
Interest paid					(53)	(40)	(82)
Net cash (used)/generated in financing activities					(53)	(1,160)	(1,203)
Net (decrease)/increase in cash and cash equivalents					(772)	(803)	(2,356)
Cash and cash equivalents at beginning of period					11,062	13,418	13,418
Cash and cash equivalents at end of period					10,290	12,615	11,062

Cash and cash equivalents included in continuing operations					7,983	12,615	11,062
Cash and cash equivalents included in assets for sale and disposal group					2,307	-	-
Cash and cash equivalents at end of period					10,290	12,615	11,062

Reconciliation of Operating Loss to Net Cash Inflow from Operating Activities
for the six months ended 30 June 2009
					Unaudited	Unaudited
					As at 30 June 2009	As at 30 June 2008	As at 31 December 2008
					£000s	£000s	£000s
Continuing operations
Operating loss on ordinary activities					(901)	(836)	(4,145)
Share options cost					42	67	32
Loss on sale of property, plant and equipment					-	-	-
Depreciation					123	133	245
Amortisation of intangible assets					6	-	13
Impairment of goodwill and intangibles					-	-	380
Write down of current financial assets					31	-	72
Write down of other financial assets					-	-	64
Foreign currency translation					(45)	146	355
(Increase) in trade and other receivables					(4,409)	(27,901)	21,079
Increase/(decrease) in trade and other payables					4,638	28,139	(20,252)
Net cash inflow/(outflow) from continuing operations					(515)	(252)	(2,157)
Discontinued operations
Operating loss on ordinary activities					1,242	126	(14,265)
Share options cost					-	-	-
Loss on sale of property, plant and equipment					-	2	-
Depreciation					13	21	35
Amortisation of intangible assets					(1,212)	530	1,036
Impairment of goodwill and intangibles					-	-	14,252
Write down of current financial assets					-	-	-
Write down of other financial assets					-	-	-
Foreign currency translation					(301)	164	625
(Increase) in trade and other receivables					85	31	85
Increase/(decrease) in trade and other payables					(252)	69	(130)
Net cash inflow/(outflow) from discontinued operations					(425)	943	1,638
Net cash generated from operations					(940)	691	(519)


Notes to the Interim Financial Statements

1. Principal accounting policies

Integrated Asset Management plc ('the Company') is a public limited company registered in England and Wales. The Company is quoted on the Alternative Investment Market (AIM) of the London Stock Exchange.

The condensed consolidated financial statements include the financial statements of the Company and its subsidiaries (together referred to as 'the Group'). Subsidiaries are all entities over which the Company has the power to govern the operating and financial policies so as to obtain benefits from its activities. The financial statements of subsidiaries are included in the Group's financial statements from the date on which control is transferred to the Group to the date that control ceases. All intra-group transactions, balances, income and expenses are eliminated on consolidation.

The interim financial report is unaudited, but has been reviewed by the external auditors. The condensed set of consolidated financial information in the interim report does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The Group's published consolidated financial statements for the year ended 31 December 2008 were approved by the Board of Directors on 8th May 2009 and filed with the Registrar of Companies. The report of the auditors on those accounts was unqualified and did not contain an emphasis of matter paragraph or a statement under Section 237 (2) or (3) of the Companies Act 1985. The condensed set of consolidated financial information was approved by the Board of Directors on 23 September 2009.

Basis of Preparation

This condensed consolidated half-yearly financial information for the six months to 30 June 2009 has been prepared in accordance with IAS 34, 'Interim financial reporting' as adopted by the European Union. The half-yearly condensed consolidated financial report should be read in conjunction with the annual financial statements for the year ended 31 December 2008, which have been prepared in accordance with IFRSs as adopted by the European Union.

The accounting policies adopted are consistent with those of the annual financial statements for the year ended 31 December 2008, as described in those financial statements, other than the adoption, with effect from 1 January 2009, of IAS 1 (revised) 'Presentation of Financial Statements'

IAS 1 (Revised), 'Presentation of financial statements' has been adopted by the Group, which prohibits the presentation of non-owner items of income and expenses in the consolidated statement of changes in equity and has had no impact on the results or financial position of the Group.

The Group has adopted IFRS 8 'Operating Segments' which replaced IAS 14 'Segmental Reporting' and requires segmental information to be presented on the same basis as that provided for internal reporting purposes to the Group's chief operating decision-maker.

A number of new standards, amendments to existing standards and interpretations have been issued, none of which are expected to have a material impact on the results or financial position of the Group for the financial year ended 31 December 2009 or future periods.


2. Segmental Reporting
Business Segments

We have reviewed a number of segmental disclosures and the requirements of IFRS 8 and since we only internally review our business on the basis of the hedge fund and brokerage units as opposed to any geographical basis, do not see the requirement for any geographical analysis.

The Group is organised into two business segments Hedge Fund and Brokerage. The segmental results are as follows:-


Business Type
			Total Hedge Fund	Discontinued Hedge Fund	Continuing Hedge Fund	Brokerage	Continuing Group
30 June 2009			£000s	£000s	£000s	£000s	£000s
Revenue from external customers			3,514	1,866	1,648	2,438	4,086
Cost of sales			(1,465)	(745)	(720)	(457)	(1,177)
Net Revenue			2,049	1,121	928	1,981	2,909
Operating costs			(2,275)	(1,079)	(1,196)	(2,323)	(3,519)
Depreciation			(79)	(13)	(66)	(57)	(123)
Amortisation of intangibles			1,206	1,212	(6)	-	(6)
Impairment of intangibles			-	-	-	-	-
Share-based payments cost			(41)	-	(41)	(1)	(42)
Write down of investments			-	-	-	(31)	(31)
Currency exchange differences			(151)	-	(151)	62	(89)
Operating profit/(loss)			709	1,241	(532)	(369)	(901)
External interest receivable and similar income			56	36	20	24	44
Inter-segment interest receivable			-	-	-	34	34
External interest payable and similar charges			(17)	(17)	-	(35)	(35)
Inter-segment interest payable			(34)	-	(34)	-	(34)
Profit/(loss) for the period before tax			714	1,260	(546)	(346)	(892)

Total assets			12,534	6,800	5,734	13,172	18,906
Total liabilities			(2,905)	(460)	(2,445)	(8,529)	(10,974)

Included within the Revenue from External customers of £4,086,000 are amounts of £583,000, £539,000 and £419,000 received from three customers, each of which generate more than 10% of the total external income.


			Total Hedge Fund	Discontinued Hedge Fund	Continuing Hedge Fund	Brokerage	Continuing Group
30 June 2008			£000s	£000s	£000s	£000s	£000s
Revenue from external customers			6,437	3,634	2,803	3,402	6,205
Cost of sales			(2,896)	(1,539)	(1,357)	(462)	(1,819)
Net Revenue			3,541	2,095	1,446	2,940	4,386
Operating costs			(4,031)	(1,417)	(2,614)	(2,431)	(5,045)
Depreciation			(56)	(22)	(34)	(76)	(110)
Amortisation of intangibles			(530)	(530)	-	-	-
Impairment of intangibles			-	-	-	-	-
Share-based payments cost			(50)	-	(50)	(17)	(67)
Write down of investments			-	-	-	-	-
Currency exchange differences			-	-	-	-	-
Operating (loss)/profit			(1,126)	126	(1,252)	416	(836)
External interest receivable and similar income			177	54	123	85	208
Inter-segment interest receivable			-	-	-	34	34
External interest payable and similar charges			(10)	-	(10)	(31)	(41)
Inter-segment interest payable			(34)	-	(34)	-	(34)
(Loss)/profit for the period before tax			(993)	180	(1,173)	504	(669)

Total assets			27,730	19,139	8,591	57,725	66,316
Total liabilities			(3,309)	(619)	(2,690)	(52,096)	(54,786)

Included within the Revenue from External customers of £6,205,000 are amounts of £1,075,000 and £652,000 received from two customers, each of which generate more than 10% of the total external income.

			Total Hedge Fund	Discontinued Hedge Fund	Continuing Hedge Fund	Brokerage	Continuing Group
31 December 2008			£000s	£000s	£000s	£000s	£000s
Revenue from external customers			11,354	6,630	4,724	5,704	10,428
Cost of sales			(5,025)	(2,734)	(2,291)	(852)	(3,143)
Net Revenue			6,329	3,896	2,433	4,852	7,285
Operating costs			(8,488)	(2,839)	(5,649)	(4,992)	(10,641)
Depreciation			(121)	(34)	(87)	(157)	(244)
Amortisation of intangibles			(1,049)	(1,036)	(13)	-	(13)
Impairment of intangibles			(14,633)	(14,253)	(380)	-	(380)
Share-based payments cost			(16)	-	(16)	(16)	(32)
Write down of investments			-	-	-	(67)	(67)
Currency exchange differences			101	-	101	(154)	(53)
Operating loss			(17,877)	(14,266)	(3,611)	(534)	(4,145)
External interest receivable and similar income			324	100	224	161	385
Inter-segment interest receivable			-	-	-	73	73
External interest payable and similar charges			(10)	-	(10)	(72)	(82)
Inter-segment interest payable			(73)	-	(73)	-	(73)
Loss for the period before tax			(17,636)	(14,166)	(3,470)	(372)	(3,842)

Total assets			16,779	6,261	10,518	10,224	20,742
Total liabilities			(7,545)	(719)	(6,826)	(4,769)	(11,595)

Included within the Revenue from External customers of £10,428,000 are amounts of £1,892,000 and £1,444,000 received from two customers, each of which generate more than 10% of the total external income.


3. Taxation
					Six months to 30 June 2009	Six months to 30 June 2008	Year to 31 December 2008
					£000s	£000s	£000s
Current tax
UK corporation tax on profits for the period					-	-	-
Adjustments in respect of prior periods					-	-	(96)
Foreign tax					23	-	18
Total current tax					23	-	(78)

Deferred Tax
Intangible assets					-	-	296
Share-based payments					-	50	(231)
Total tax charge for the period					23	50	(13)


4. Discontinued operations
On 17 September 2009 the Group completed the sale of the majority of its fund of hedge funds business, including its 51% stake in Altigefi, to Sal. Oppenheim (France), the Paris based wholly-owned subsidiary of Sal. Oppenheim jr & Cie S.C.A. ('Sal. Oppenheim'). The operations included in this sale have been treated as discontinued operations for the period ended 30th June 2009.

The table below provides further detail of the amount shown on the income statement. The income statements for the prior periods have been restated to conform to this style of presentation.

					Six months to 30 June 2009	Six months to 30 June 2008	Year to 31 December 2008
					£000s	£000s	£000s
Revenue					1,866	3,634	6,630
Cost of sales					(745)	(1,539)	(2,734)
Net revenue					1,121	2,095	3,896
Operating costs					(1,092)	(1,439)	(2,873)
Amortisation of intangibles					1,212	(530)	(1,036)
Share-based payments cost					-	-	-
Operating profit/(loss) before impairment of goodwill and intangibles					1,241	126	(13)
Impairment of goodwill and intangibles					-	-	(14,253)
Operating profit/(loss) before impairment of goodwill and intangibles					1,241	126	(14,266)
Finance income					36	54	100
Finance expense					(17)	-	-
Profit/(loss) before taxation					1,260	180	(14,166)
Taxation					(339)	(67)	49
Profit/(loss) from discontinued operations					921	113	(14,117)


The net cash flows after tax of discontinued operations are as follows:
					Six months to 30 June 2009	Six months to 30 June 2008	Year to 31 December 2008
					£000s	£000s	£000s
Operating					(287)	447	848
Investing					34	46	72
Financing					(17)	(662)	(662)
Net cash inflow					(270)	(169)	258


5. Earnings per share
The calculation of Earnings per Share ('EPS') is based on profit that is attributable to owners of the parent Company only.

Potential ordinary shares have only been included in the diluted EPS calculation where their effect has been dilutive to basic EPS.

Details of the figures used in calculating basic and diluted EPS are shown below:

					30 June 2009	30 June 2008	31 December 2008
					£000s	£000s	£000s
(Loss) from continuing operations					(915)	(719)	(3,829)
Non controlling interests					-	17	-
(Loss) from continuing operations used in calculating basic and diluted EPS					(915)	(702)	(3,829)
Total (loss)/ profit for the period					6	(606)	(17,946)
Non controlling interests					29	(199)	(303)
Total (loss)/ profit used in calculating basic and diluted EPS					35	(805)	(18,249)


					No. '000s	No. '000s	No. '000s
Weighted average number of ordinary shares used in calculating basic EPS					42,147	41,950	42,030
Effect of dilutive potential ordinary shares:
- share options					-	-	-
- shares to be issued					-	-	-
- contingently issuable shares					-	-	-
Weighted average number of ordinary shares used in calculating diluted EPS					42,147	41,950	42,030


Basic EPS from continuing operations has been calculated using the loss from continuing operations £915k (excluding non controlling interests) divided by the weighted average number of ordinary shares 42,147k.

Diluted EPS from continuing operations has been calculated using the loss from continuing operations £915k (excluding non controlling interests) divided by the weighted average number of ordinary shares 42,147k.


6. Intangible assets
				Goodwill	Management Contracts	Development Costs	Total
30 June 2009				£000s	£000s	£000s	£000s
Cost
At 1st January, 2009				16,791	3,953	37	20,781
Additions				-	-	-	-
Acquisition of subsidiaries				-	-	-	-
Reclassification as non-current asset held for sale				(14,253)	(3,953)	-	(18,206)
Movement on exchange				(170)	-	-	(170)
Changes in deferred consideration				-	-	-	-
At 30th June 2009				2,368	-	37	2,405
Amortisation
At 1st January, 2009				(15,004)	(1,465)	(12)	(16,481)
Amortisation				-	-	(6)	(6)
Amortisation reversal				-	1,212	-	1,212
Reclassification as non-current asset held for sale				14,253	253	-	14,506
Impairment				-	-	-	-
At 30th June 2009				(751)	-	(18)	(769)
Net Book Value at 30th June 2009				1,617	-	19	1,636

				Goodwill	Management Contracts	Development Costs	Total
30 June 2008				£000s	£000s	£000s	£000s
Cost
At 1st January, 2008				14,768	3,953	37	18,758
Additions				-	-	-	-
Acquisition of subsidiaries				27	-	-	27
Reclassification as non-current asset held for sale				-	-	-	-
Movement on exchange				495	-	-	495
Changes in deferred consideration				-	-	-	-
At 30th June 2008				15,290	3,953	37	19,280
Amortisation
At 1st January, 2008				(371)	(429)	-	(800)
Amortisation				-	(530)	-	(530)
Amortisation reversal				-	-	-	-
Reclassification as non-current asset held for sale				-	-	-	-
Impairment				(5)	-	-	(5)
At 30th June 2008				(376)	(959)	-	(1,335)
Net Book Value at 30th June 2008				14,914	2,994	37	17,945

				Goodwill	Management Contracts	Development Costs	Total
31 December 2008				£000s	£000s	£000s	£000s
Cost
At 1st January, 2008				14,768	3,953	37	18,758
Additions				39	-	-	39
Acquisition of subsidiaries				-	-	-	-
Reclassification as non-current asset held for sale				-	-	-	-
Movement on exchange				2,047	-	-	2,047
Changes in deferred consideration				(63)	-	-	(63)
At 31st December 2008				16,791	3,953	37	20,781
Amortisation
At 1st January, 2008				(371)	(429)	-	(800)
Amortisation				(1)	(1,036)	(12)	(1,049)
Amortisation reversal				-	-	-	-
Reclassification as non-current asset held for sale				-	-	-	-
Impairment				(14,632)	-	-	(14,632)
At 31st December 2008				(15,004)	(1,465)	(12)	(16,481)
Net Book Value at 31st December 2008				1,787	2,488	25	4,300


7. Trade and other receivables
					30 June 2009	30 June 2008	31 December 2008
					£000s	£000s	£000s
Trade receivables					1,634	3,479	3,408
Matched principal trade receivables					6,039	49,569	661
Other receivables					713	589	964
Prepayments					293	299	295
					8,679	53,936	5,328

Matched principle trade receivables represent the grossed-up value of matched trades that were undertaken by the Brokerage business before the period end, but which while within the settlement cycle remained unsettled at the balance sheet date. The margin relating to these trades is the difference between the receivable and the matched payable and is recorded in the group's income statement


8. Cash and cash equivalents
					30 June 2009	30 June 2008	31 December 2008
					£000s	£000s	£000s
Cash at bank and in hand					7,923	11,014	10,997
Cash at bank and in hand: EBT					60	1,601	65
Total cash and cash equivalents					7,983	12,615	11,062

Included within cash and cash equivalents held by the Group is cash held by an Employee Benefit Trust ('EBT'), which was set up during 2007. Cash held by the EBT is controlled by the EBT's trustee and is allocated to potential beneficiaries when a constructive obligation arises to pay them.


9. Borrowings
					30 June 2009	30 June 2008	31 December 2008
					£000s	£000s	£000s
Non-current
Bank loan					-	-	-
					-	-	-
Current
Bank loan					1,153	1,071	1,309
					1,153	1,071	1,309


10. Deferred tax
The movement in deferred tax assets and liabilities during the period was as follows
					30 June 2009	30 June 2008	31 December 2008
					£000s	£000s	£000s
Deferred tax liabilities - intangible assets
At beginning of period					(697)	(1,062)	(1,062)
Acquisition of subsidiaries					-	-	-
Income statement (charge) / credit					(339)	164	365
At end of period					(1,036)	(898)	(697)
Deferred tax assets - share-based payments
At beginning of period					-	141	141
Income statement (debit)/credit					-	(50)	(64)
(Debited) directly to equity					-	(31)	(77)
At end of period					-	60	-

Net deferred tax liabilities					(1,036)	(838)	(697)



11. Trade and other payables
					30 June 2009	30 June 2008	31 December 2008
					£000s	£000s	£000s
Non-current
Other creditors					-	-	-
					-	-	-
Current
Trade payables					1,195	1,629	1,909
Matched principal trade payables					6,037	49,546	661
Other taxation and social security costs					239	673	299
Accruals and deferred income					1,304	1,494	1,980
					8,775	53,342	4,849


12. Share Capital
		30 June 2009	30 June 2009	30 June 2008	30 June 2008	31 December 2008	31 December 2008
			Number of Ordinary 5p shares		Number of Ordinary 5p shares		Number of Ordinary 5p shares
		£000s	000	£000s	000	£000s	000
Authorised:
At beginning of period		10,000	200,000	10,000	200,000	10,000	200,000
At end of period		10,000	200,000	10,000	200,000	10,000	200,000

Allotted and fully paid:
At beginning of period		2,107	42,147	2,083	41,662	2,083	41,662
Conversion of loan notes		-	-	16	328	16	328
Deferred consideration		-	-	-	-	7	138
Altigefi acquisition		-	-	1	19	1	19
Movement during the period		-	-	17	347	24	485
At end of period		2,107	42,147	2,100	42,009	2,107	42,147

The loan notes were converted at a price of 95p on 27th January 2008, the consideration totalling £ 311,750. The shares issued in 2008 relating to deferred consideration and Altigefi acquisition were previously shown as shares to be issued.


13. Related Party Transactions
There were no material changes to the related party transactions during the six months ended 30 June, 2009


14. Post Balance Sheet Events
On 16 September 2009 following an application by the Company, the courts approved the Capital Reduction (having first obtained shareholder approval) which allows the Company to cancel the 11,496,111 Ordinary Shares in the Company held by Sal. Oppenheim jr. Following the cancellation of the Sal Oppenheim jr. shares on 17 September 2009, the Company has 30,651,386 Ordinary shares in issue.

Also on 16th September 2009 following an application by the Company the courts approved the Reduction in the Share Premium Account required to eliminate the accumulated deficit on the Company's profit and loss thus creating distributable profits. This application had previously been approved by a special resolution at a General Meeting.

On 17 September 2009 the Group completed the sale of the majority of its fund of hedge funds business, including its 51% stake in Altigefi, to Sal. Oppenheim (France), the Paris based wholly-owned subsidiary of Sal. Oppenheim jr & Cie S.C.A. ('Sal. Oppenheim'), for a combined consideration of approximately Eur3.5 million in cash and the cancellation of Sal. Oppenheim's entire share capital in the Company of 11,496,111 shares (representing approximately 27.1% of the allotted shares immediately prior to cancellation).

This information is provided by RNS

The company news service from the London Stock Exchange

END

IR EAENLAEFNEFE

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