Interim Results

Impact Holdings (UK) plc ("Impact" or "The Group")

Interim Results

Impact (AIM: IHUK), the specialist lender, announces its unaudited interim results for the six months ended 30 September 2009.

Financial Highlights

  • results in line with management expectations
  • cash and cash equivalents of £0.4 million
  • gross profit maintained
  • overhead costs remain static
  • earnings per share 12p

Operational Highlights

  • successful acquisition of Sutherland Professional Funding Limited completed on 30th December 2009
  • bolstering of the Board with the appointments of Roger Barlow as Chairman, John Russell as Non-Executive Director and Stuart Burn as Operations Director
  • increased bank debt facilities to support ongoing trading
  • structured risk management to support monitoring of existing exposures
  • further growth opportunities for primary business lines identified

For further information:

Impact Holdings (UK) plc.

Paul Davies Chief Executive Officer Tel: +44 (0)161 437 9499 www.impactholdings.net

Daniel Stewart & Co Simon Leathers, Corporate Finance Tel: +44 (0) 207 776 6550 simon.leathers@danielstewart.co.uk

The financial information for the half year ended 30 September 2009 has been extracted from the interim results, which is available on the Company's website (www.impactholdings.net).

			


 
CHAIRMAN'S STATEMENT
 
I am pleased to report our unaudited interim financial results for the six
months ended 30th September 2009. Revenue of £893,606 and pre-tax profit of £
137,354 were in line with expectations, as were cash flows and origination
levels.
 
The general economic downturn experienced in 2008 has continued into 2009 with
a lack of confidence in the economy and a lack of liquidity in the banking
markets.
 
Business Overview
 
The lack of liquidity in the banking markets, our concerns for the overall
economic environment in which we trade and our desired strategy of
concentrating on better quality covenants have resulted in a slowing down of
our growth in the first six months. We have undertaken a lengthy and detailed
due diligence on the acquisition of Sutherland Professional Funding Limited
("Sutherlands") culminating in the transaction being completed on 30th December
with day to day operations having been successfully migrated to our Head Office
in Manchester.
 
This acquisition complements the existing solicitor lending business and brings
with it the following benefits:
 
  * the increased scale of the business has brought further funding lines;
   
  * the combined client base will create access to significant cross selling
    opportunities;
   
  * the acquisition is being integrated into the infrastructure and operating
    platforms of the existing Impact business, creating synergistic gains
    through economies of scale.
   
The business of solicitor lending, in relation to funding disbursements on
personal injury cases, continues to be our core market albeit we have adopted a
more conservative approach within the credit risk function.
 
The Group instigated its property bridging business to fund short term property
transactions in July 2007 but the severe downturn in the property market and
the "credit crunch" have resulted in an unprecedented effect on the
marketplace. Banks and Building Societies reduced the availability of mortgages
and as a consequence the refinancing options for bridging loan transactions
have diminished. This lack of liquidity has therefore resulted in a strategic
decision to continue to restrict new exposures to lower loan to values where a
refinance is not perceived to be problematic.
 
Board Appointment
 
I was appointed Non Executive Chairman on 1st December 2009 and am pleased that
Richard Kilsby has agreed to continue as a Non Executive Director. On 22nd
September 2009 Stuart Burn, who has been with the Group since April 2008, was
appointed Operations Director.
 
I am delighted to confirm that John Russell has been appointed to the Board as
part of the Sutherlands acquisition. John is an experienced and successful
businessman who has significant experience in the strategic development of
businesses. He has been on the board of Sutherlands since 2003 and his
appointment to the Board is an important part of the continuity plan. John has
previously been President and Treasurer of the Freight Transport Association
and Chairman of the Scottish Business Crime Centre. He is presently a committee
member of the CBI Scotland Council, a director of the Freight Transport
Association and Chairman of John G. Russell Transport Group.
 
Outlook
 
The Group remains focussed on providing services to the legal sector and
maximising niche funding opportunities. The acquisition of Sutherlands is the
first step in rolling out this strategy and this, coupled with our existing
businesses, will provide the foundation for controlled growth, improved
profitability and enhanced shareholder value.
 
Roger Barlow
Non Executive Chairman
 
 
 
IMPACT HOLDINGS (UK) PLC                                                      
                                                                              
UNAUDITED CONSOLIDATED INCOME STATEMENT                                       
 
                                                6 Months   6 Months        Year
                                                   ended      ended       ended
                                              30/09/2009 30/09/2008  31/03/2009
                                                       £          £           £
                                                                               
Revenue                                          893,606  1,179,637   2,044,973
                                                                               
Cost of sales                                  (225,760)  (498,291)   (787,220)
                                                                               
Gross profit                                     667,846    681,346   1,257,753
                                                                               
Total operating expenses                       (531,159)  (549,594) (1,013,915)
                                                                               
Operating profit                                 136,687    131,752     243,838
                                                                               
Interest receivable                                  667     59,201      46,796
                                                                               
Profit for the period from                       137,354    190,953     290,634
operations before tax                                                          
                                                                               
Tax expense                                            -          -           -
                                                                               
Profit for the period                            137,354    190,953     290,634
                                                                               
Earnings per share (basic)                           12p        17p         26p
                                                                               
Earnings per share (fully                            12p        17p         26p
diluted)                                                                       
 
 
 
IMPACT HOLDINGS (UK) PLC                                                      












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© 2007 Impact Holdings (UK) Plc 

Enquiry : enquiries@impactholdings.net | Support : support@impactholdings.net




Company registration details: Impact Holdings (UK) Plc (5384161), Impact Funding Solutions Ltd (5990846), Impact IT Solutions Ltd (5990933), Impact Funding (UK) Ltd (5174961), Impact Bridging Solutions Ltd (5991021), Impact Bridging Developments Limited (06343056)
, Sutherland Professional Funding Ltd (SC162447)
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