Arden Partners : Annual Report and Accounts

Arden Partners plc Annual Report 2021

Arden Partners plc

Arden Partners is a dedicated corporate adviser and multi-service stockbroker to small and mid-cap companies in the UK and their investors.

The core purpose of our business is to best represent our significant base of corporate clients, and effectively support their relationships with existing and potential shareholders.

This relationship is a function of the quality of corporate finance advice we provide to our corporate clients, the high quality of our industry research, and the presence in the market that our sales and trading teams have.

Our corporate finance capabilities encompass M&A, corporate finance advisory, broking, Sponsor and NOMAD services. We represent our clients in private transactions, Aquis, AIM and Main Market listings.

Our research is designed to be sector focused, taking top down thematic trends, which lead us towards companies that give investors an exposure to the real growth areas of the small-cap and mid-cap markets.

The sales team's role is to keep institutions abreast of these themes and stock ideas. When there is a requirement for our corporate clients to raise money to fulfil their growth ambitions, the sales team is in a strong position to effect this, with the entrenched relationships that the team enjoys with the UK institutional and non-institutional shareholder base.

Our responsibility of care to our corporate clients is augmented by our market making and trading teams, who provide liquidity in the shares of our corporate clients. We also trade the shares of non-client corporates on behalf of institutions.

The Arden Wealth Management team offers a bespoke service to our clients, with the ability to trade/invest in equities, bonds and a range of global investment funds, as well as allowing clients to participate in Primary and Secondary equity placings.

Contents

Page:
1	Highlights
4	Chairman's Statement
5	Chief Executive's Statement
7	Finance Review
9	Strategic Report
23	Board of Directors
24	Report of the Directors
27	Corporate Governance
33	Directors' Remuneration Report
37	Statement of Directors' Responsibilities
38	Independent Auditor's Report
47	Consolidated Statement of Comprehensive Income
48	Consolidated Statement of Financial Position
49	Company Statement of Financial Position
51	Consolidated Statement of Cash Flows
52	Company Statement of Cash Flows
53	Consolidated Statement of Changes in Equity
54	Company Statement of Changes in Equity
55	Notes to the Consolidated Financial Statements
91	Corporate Information

HIGHLIGHTS

FINANCIAL	Year ended 31 October 2021	Year ended 31 October 2020
Revenue	£9.3m	£5.9m
Profit/(loss) before tax	£0.8m	(£1.4m)
Profit/(loss) per share:
Basic	4.8p	(5.0p)
Diluted	4.3p	(4.9p)
Cash and cash equivalents	£2.5m	£2.4m
Net assets	£5.8m	£4.6m
NON-FINANCIAL
Funds raised for clients	£193m	£90m
Transactions completed	29	22
Retained corporate clients	42	47
Average number of staff	38	43

HIGHLIGHTS

Market overview

• • UK equity markets remained buoyant throughout FY21, continuing the trend that started in the second half of 2020, with institutional investors prepared to support ambitious growing companies

• • The AIM IPO market performed strongly in 2021 with 87 AIM IPOs raising a cumulative £1.9bn (2020: 32 IPOs raising a cumulative £0.5bn) (source: London Stock Exchange)

• • The secondary fundraise market also had significant growth with £6.9bn was raised by AIM listed companies (up from £5.8bn in 2020) (source: London Stock Exchange)

• • Competition for capital was fierce, particularly in the second half of 2021

• • M&A activity for both public and private companies remained strong

Operational highlights

• • Arden completed 29 transactions in FY21 (FY20: 22 transactions) including:

  • o Three IPOs/Reverse Take Overs (FY20: 1 IPO/RTO)

  • o 15 equity fundraisings (FY20: 10 equity fundraisings)

• • £193 million raised for listed clients (FY20: £90 million)

• • Three Takeover Code transactions completed (FY20: 2 transactions)

• • The work of the Company's Research and Corporate Finance teams was recognised by judges in a number of industry awards

Financial highlights

• • Revenue up 56.5% to £9.3 million (FY20: £5.9 million)

• • Profit before tax of £0.8 million (FY20: £1.4 million loss before tax)

• • Basic earnings per share of 4.8p (FY20: 5.0p loss per share)

• • Net asset value per share at the year end up 24.4% to 17.3p (FY20: 13.9p)

Recommended all share offer for Arden Partners plc by The Ince Group plc (the "Acquisition")

• • On 26 October 2021, the boards of The Ince Group plc ("Ince") and Arden announced that they had reached agreement on the terms of a recommended all share offer by Ince for the entire issued and to be issued ordinary share capital of Arden

• • Strategic and financial rationale for the Acquisition as set out in the Scheme Document published on 20 December 2021

• • Seven Ince shares for every 12 Arden shares allows Arden shareholders to participate in the potential value creation of the combined business

• • Arden shareholder approval for the Acquisition obtained on 19 January 2022

• • The Acquisition remains conditional on:

  • o the approval of the London Stock Exchange to Arden's re-application to be a nominated adviser on AIM following the change of control of Arden

  • o final sanction by the Court