Source - RNS
RNS Number : 5004K
Miton Group Plc
22 September 2016
 

22 September 2016

 

MITON GROUP PLC

HALF YEAR RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2016

 

Strong increase in profits driven by higher average AUM

 

Miton Group plc (the 'Company' or 'Group'), the AIM quoted fund management group, today announces its half year results for the six months ended 30 June 2016.

 

Business Highlights  

 

·    £2,542 million Assets under Management (AuM), up from £2,225 million for the same period last year.

·    £2,710 million AuM as at 31 August 2016.  The multi-asset fund range AuM has increased by 7.1% since 31 December (excluding CF Miton Total Return Fund) to reach £487m as at 31 August 2016.

·    Adjusted Profit before tax significantly higher at £3.1m, up from £0.8m in the same period last year.

·    Net management fee margin maintained across the product range.

·    Significant net inflows in the first quarter were offset in the second quarter primarily due to the outflows from the CF Miton UK Value Opportunities Fund.

·    Andrew Jackson joined the Group on 27 June 2016 and assumed responsibility for the management of the CF Miton UK Value Opportunities Fund from 1 July 2016.

·    CF Miton European Opportunities Fund had £71 million in AuM as at 31 August 2016 after being launched in December 2015. The fund has delivered top quartile performance since inception.

·    £18.4 million net cash at 31 August 2016.

 

 

Financial Highlights


Unaudited six months to 30 June 2016

£m

Unaudited six months to 30 June 2015

£m

Audited year to 31 December 2015

£m


Closing AuM

2,542

2,225

2,784

Average AuM (1)

2,792

2,140

2,319

Net revenue

9.6

7.1

15.7

Adjusted Profit before tax (2)

3.1

0.8

3.0

Profit before tax (3)

2.9

0.6

2.1

Cash generated from operations

4.4

0.9

2.4

Total Cash

17.4

13.6

14.1






pence

pence

pence

Adjusted earnings per share (4)

1.67

0.43

1.43

Diluted adjusted earnings per share (5) (5(5)

1.48

0.37

1.18

Basic earnings per share

1.56

0.28

0.92

Diluted Basic earnings per share

1.39

0.24

0.75

 

Notes

(1) Average AuM is based on the total month end closing AuM for each product managed by the Group.

(2) Adjusted Profit is calculated before the deduction of amortisation, exceptionals, VAT provision relating to prior years and taxation.

(3) The 2016 profit before tax includes £0.04m of exceptional operating expenses (31 December 2015:  £0.32m) relating to costs associated with the implementation of a new remuneration structure for the investment team. In 2015 the exceptional items related to redundancy and restructuring costs.

(4) Adjusted earnings per share excludes charges for amortisation, exceptionals, VAT provision and associated taxation.

(5) Diluted adjusted earnings per share involves a dilution of 12.5% largely as a result of an estimate of the Miton Group plc shares which would be issued if all the Growth Share Plan shares with an accrued value at 30 June 2016 had vested and had been exchanged for Miton Group plc ordinary shares at that date.

 

 

Ian Dighé, Executive Chairman of Miton Group, commented:

 

"We are pleased to report a significant increase in half year profits, driven by a higher level of average AUM over the period in unsettled market conditions.

 

"Since the half year end we have regained asset growth momentum, most pleasingly in our multi-asset fund range through a combination of inflows and performance.

 

"Our focus remains on continuing to grow assets by delivering distinctive active management of our funds, whilst keeping a tight control of costs. Overall, we have confidence in the outlook for the year as a whole."

 

 

For further information, please contact:

 

Miton Group plc                                                                                               020 3714 1500      

Ian Dighé (Executive Chairman)                                                                          

Gervais Williams (Managing Director)                                                                  

Piers Harrison (Chief Operating Officer)                           

 

MHP Communications                                                                        

Reg Hoare / Simon Hockridge / Charlie Barker                                                      020 3128 8100

 

Peel Hunt (Nominated adviser and Broker)                                                     020 7418 8893

Guy Wiehahn / Rishi Shah

 

www.mitongroup.com

 

Notes to Editors:

Miton Group plc (referred to as the "Company" or "Group"), is an equity and multi-asset fund management specialist. As at 30 June 2016 the Group managed £2,542 million of assets including eight OEICs, two unit trusts and four investment trusts under the Miton brand.

 

Chairman's Statement

 

Overview

I am pleased to report that for the first six months of the financial year the Group has delivered an increase in profits which has been driven by higher average Assets under Management (AuM) over the period.

 

Strong inflows in the first quarter saw the AuM rise to £3,032m. However, these gains were more than offset in the second quarter due to net outflows of £423m experienced from the CF Miton UK Value Opportunities Fund and market volatility immediately after the EU Referendum vote at the end of June.

 

AuM on 30 June 2016 was £2,542m. This has subsequently grown to £2,710m as at 31 August 2016.

 

The net sales during the first quarter of £259m were a record for the Group. Strong performance across our fund range has aided inflows and by continuing to deliver distinctive strategies for our clients with clear and regular communication we have built on the strong foundations that are now well established.

 

The change to the fund managers on the CF Miton UK Value Opportunities Fund inevitably led to redemptions. The Group moved swiftly to appoint Andrew Jackson who has an impressive and consistent performance record of delivering value for clients over a number of investment cycles. Andrew's approach has been well received and he has already made progress since taking over the fund on 1 July 2016, delivering first quartile performance from that date against significant challenges post the referendum.

 

Miton continues to demonstrate its ability to launch funds and provide talented managers with a platform for asset gathering. Our most recent launch, the CF Miton European Opportunities Fund in December 2015, has now grown to £71m as at 31 August 2016. The managers' distinctive investment proposition has delivered first quartile performance since inception. The Miton UK MicroCap Trust plc also raised an additional £28m through a C Share issue in February. This focus on the very smallest companies continues to attract client interest and attention.

 

With regards to our multi-asset funds, I am pleased to report that the combination of good performance over the two year management tenure by the team and client demand has allowed us to renew the momentum in inflows for these products.

 

Investment Performance

Low bond yields imply that longer term returns on assets could be more limited in future. At 31 August the Group's product range continues to perform well with 9 out of 14 funds in the first quartile of their respective sectors over the tenures of the current managers.

 

Results

Adjusted Profit before tax was £3.1m (30 June 2015: £0.8m), an increase of 288% compared to the comparative period last year. This figure included an accounting credit of £0.43m to share-based payments reflecting the forfeitures of awards during the period.

 

The Group continues to be soundly financed with £17.4m of cash on hand as at 30 June 2016 (31 December 2015: £14.1m) and no long term debt.

 

Fund Manager Retention

Miton operates within an increasingly competitive market with remuneration and incentives on the agenda of both clients and our regulator. As announced in July, the current fund manager retention and incentive arrangement will be discontinued as the principal reward mechanism for new fund managers and for those where no value has been accrued to date. From the second half of 2016, a new remuneration structure has been introduced which is based upon a share of net revenues and adjusted for high investment performance and the achievement of our clients' objectives. It will not require the issuance of Miton Group plc shares.

 

Outlook

Whilst financial markets continue to be unsettled by the political landscape our experienced investment teams are delivering distinct and strong investment performance with attractive returns for investors. We will continue to take advantage of changing market trends not only with our existing range of funds but also with new products that provide solutions to our clients' future needs.  Since the half year-end, we have experienced renewed momentum in asset growth giving us confidence in the outlook for the year as a whole.

 

Ian Dighé,

Executive Chairman

21 September 2016

 

 

Financial Review

 

Results for the half year

The average Assets under Management (AuM) for the period were £2,792m reflecting the significant net inflows achieved in the first quarter. Adjusted Profit before tax increased by 288% to £3.1m compared to £0.8m for the 2015 comparable period. Cash generated from operations for the period increased to £4.43m (2015: £0.88m). This is partly due to the reversal of the high trade receivables balance noted in the 2015 accounts.

 

AuM by asset class

 







Opening

AuM

1 Jan

2016

£m

Net

Flows

£m

Market / investment performance

£m

Closing

AuM

30 June

2016

£m






Equity funds

1,834

(101)

(135)

1,598

Multi-asset funds

477

(17)

18

478

 

Total funds

2,311

(118)

(117)

2,076

 

Investment trusts

473

28

(35)

466

 

Total

2,784

(90)

(152)

2,542






 

Net outflows were experienced in the second quarter primarily due to the CF Miton UK Value Opportunities Fund. This offset the net inflows achieved in the first quarter.

 

Net management fees and margins


Unaudited

 six months to 30 June 2016

Unaudited

 six months to 30 June 2015

Audited

 year to 31 December 2015

Average AuM* (£m)

2,792

2,140

2,319

Net management fees (£m)

9.6

7.1

15.7

Net management fee margin (bps)

68.8

66.6

 67.7

*calculated on a monthly basis based on closing AuM

 

Net management fee margins increased slightly to 68.8bps (2015 full year: 67.7bps). This reflects the higher margins attained on our investment trust business and the Group's maturing equity funds.

 

Costs

Administrative expenses (excluding share-based payments) were £6.2m for the half year. Fixed personnel costs were in line with expectations. Semi-variable personnel costs rose due to bonus accruals from a higher Adjusted Profit before tax figure. Additional bonus provisions were recognised for the fund managers relating to the introduction of the new remuneration scheme totalling £0.42m at the half year.

 

Overheads comprise IT, administration, sales and marketing, insurance and occupancy costs. Included within overheads were non-recurring recruitment costs amounting to £0.16m associated with the changes to the CF Miton UK Value Opportunities Fund.

 

Other costs consist principally of depreciation and irrecoverable VAT.

 

Share-based payments decreased during the period due to write-backs arising from the forfeiture of awards in accordance with IFRS. The charge for the period of £0.24m reflects a credit for these forfeitures totalling £0.43m.

 

Exceptional expenses of £0.04m for the period (2015: £nil) related to costs associated with the implementation of a new remuneration structure for the investment team. The Growth Share Plan will be discontinued as the principal reward and retention mechanism for new fund managers and for those where no value has been accrued to date.

 

Initiatives

As noted in the 2015 full year accounts, the significant infrastructure changes for the Group have now been completed. The liquidations of Miton (Hong Kong) Limited and PSigma Asset Management Limited are due to be completed by the year-end.

 

In February the Group completed the transition of the Miton Income Fund to the operating model adopted for all open ended funds.

 

The CF Miton Total Return Fund was identified as economically unviable due to its lack of critical mass. It was therefore deemed to be in the best interests of the investors to wind up the fund. This was completed on 17 May 2016.

 


2016 HY

 £m

2015 FY

£m

2014 FY

£m

Net revenue

9.6

15.7

17.2

Administrative expenses

(6.2)

(11.3)

(11.3)

Share-based payments

(0.2)

(1.2)

(0.9)

Interest

-

-

0.1

Add back: VAT*

-

(0.2)

0.2

Adjusted Profit before tax

3.1

3.0

5.3

Adjusted Profit before tax margin %

32.6

19.1

30.6

* Provision relating to prior years



 

 

Piers Harrison

Chief Operating Officer

21 September 2016

 

Interim Unaudited Consolidated Statement of Comprehensive Income

for the six months to 30 June 2016

 


Notes

Unaudited

 Six months

 to 30 June

2016

£000

Unaudited 

Six months

to 30 June

2015

£000

Audited

Year to

31 December 2015

£000

Revenue


12,174

10,372

22,031

Fees and commission expenses


(2,557)

(3,242)

(6,306)

Net revenue


9,617

7,130

15,725

Administration expenses


(6,247)

(5,505)

(11,319)

Share-based payment charge

10

(240)

(588)

(1,218)

Amortisation of intangible assets


(150)

(414)

(768)

Exceptional operating expenses

4

(42)

-

(317)

Operating profit


2,938

623

2,103

Finance revenue


8

10

22

Profit for the period before taxation


2,946

633

2,125

Taxation

5

(585)

(205)

(730)

Profit for the period after taxation and attributable to equity holders of the parent


2,361

428

1,395








pence

pence

pence

Basic earnings per share 

6(a)

1.56

0.28

0.92

Diluted Basic earnings per share

6(a)

1.39

0.24

0.75

 

No other comprehensive income was recognised during 2016 or 2015. Therefore the profit for the period is also the total comprehensive income.



 

Interim Unaudited Consolidated Statement of Changes in Equity

for the six months to 30 June 2016

 


Share

Capital

£000

Share Premium £000

Employee

Benefit

Trust

£000

Treasury

Shares

£000

Creditors' Reserve

 £000

Retained Earnings

£000

Total

£000

At 1 January 2016

171

2,661

(6,520)

(26)

-

61,931

58,217

Profit for the period

-

-

-

-

-

2,361

2,361

Release of Treasury shares

-

-

-

16

-

-

16

Purchase of Employee Benefit Trust shares

-

-

(10)

-

-

-

(10)

Share-based payment expense

-

-

-

-

-

240

240

Settlement for forfeiture of options

-

-

-

-

-

(59)

(59)

Deferred tax direct to equity

-

-

-

-

-

(3)

(3)

Equity dividends paid

-

-

-

-

-

(1,012)

(1,012)

At 30 June 2016 (Unaudited half year)

171

2,661

(6,530)

 

(10)

-

63,458

59,750









At 1 January 2015

171

2,661

(6,294)

(26)

3,057

57,171

56,740

Profit for the period

-

-

-

-

-

428

428

Release of Treasury Shares

-

-

-

43

-

-

43

Purchase of Treasury Shares

-

-

-

(17)

-

-

(17)

Share-based payment expense

-

-

-

-

-

588

588

Release from Creditors' Reserve

-

-

-

-

(146)

146

-

Equity dividends paid

-

-

-

-

-

(910)

(910)

At 30 June 2015 (Unaudited half year)

171

2,661

(6,294)

 

-

2,911

57,423

56,872









At 1 January 2015

171

2,661

(6,294)

(26)

3,057

57,171

56,740

Profit for the year

-

-

-

-

-

1,395

1,395

Release of Treasury shares



43

-

-

-

43

Purchase of Treasury shares

-

-

(17)

-

-

-

(17)

Purchase of Employee Benefit

Trust Shares

-

-

(252)

-

-

-

(252)

Share-based payment charge

-

-

-

-

-

1,218

1,218

Release from Creditors' Reserve

-

-

-

-

(3,057)

3,057

-

Equity dividends paid

-

-

-

-

-

(910)

(910)

At 31 December 2015 (Audited)

171

2,661

(6,520)

(26)

-

61,931

58,217



 

Interim Unaudited Consolidated Statement of Financial Position

as at 30 June 2016

 


Notes

Unaudited

 30 June

2016

£000

Unaudited

 30 June

2015

£000

 

Audited

31 December

2015

£000

Non-current assets





Goodwill


41,070

41,070

41,070

Intangible assets


957

1,361

1,107

Investments


100

-

-

Property and equipment


120

201

161



42,247

42,632

42,338

Current assets





Trade and other receivables


2,591

4,014

4,620

Deferred tax asset


23

90

61

Cash and cash equivalents

7

17,400

13,605

14,073



20,014

17,709

18,754

Total assets


62,261

60,341

61,092






Current liabilities





Trade and other payables


2,176

2,650

2,554

Other payables


-

550

-



2,176

3,200

2,554

Non-current liabilities       





Provisions

8

138

25

89

Deferred tax liability


197

244

232



335

269

321

Total liabilities


2,511

3,469

2,875

Net assets


59,750

56,872

58,217






Equity





Share capital

9

171

171

171

Share premium


2,661

2,661

2,661

Employee Benefit Trust


(6,530)

(6,294)

(6,520)

Treasury Shares


(10)

-

(26)

Creditors' reserve


-

2,911

-

Retained earnings


63,458

57,423

61,931

Total equity shareholders' funds


59,750

56,872

58,217

 



 

Interim Unaudited Consolidated Statement of Cash Flows

for the six months to 30 June 2016


Notes

Unaudited

Six months

to 30 June

2016

£000

Unaudited

Six months

to 30 June

2015

£000

Audited

Year to

31 December

2015

£000

Operating activities





Profit after taxation


2,361

428

Adjustments to reconcile profit to net cash flow from operating activities:





Tax on continuing operations

5

585

205

730

Net finance revenue


(8)

(10)

(22)

Depreciation


44

44

88

Loss on disposal of fixed assets


-

2

3

Amortisation of intangible assets


150

414

768

Share-based payment expense

10

240

588

1,218

Settlement for forfeiture of options


(59)

-

-

Decrease/(Increase) in trade and other receivables


1,484

(295)

(1,205)

Decrease in trade and other payables


(418)

(262)

(357)

Increase/(decrease) in provisions

8

49

(235)

(171)

Cash generated from operations


4,428

879

2,447

Income tax paid


-

(1,141)

(1,346)

Net cash flow from operating activities


4,428

(262)

1,101

Investing activities:





Interest received


8

10

22

Purchase of property and equipment


(3)

(31)

Purchase of investments


(100)

-

Acquisition of Darwin Investment Managers Limited


-

(420)

Purchase of Matterley management contract


-

-

Net cash flow from investing activities


(95)

(441)

(1,084)

Financing activities:





Purchase and release of Treasury shares and Employee Benefit Trust shares


6

26

(226)

Dividend paid

3

(1,012)

(910)

(910)

Net cash flow from financing activities


(1,006)

(884)

(1,136)

Increase/(decrease) in cash and cash equivalents


3,327

(1,587)

(1,119)

Opening cash and cash equivalents


14,073

15,192

15,192

Closing cash and cash equivalents

7

17,400

13,605

14,073

 

 

 

 

 

Notes to the Interim Unaudited Consolidated Financial Statements

for the six months to 30 June 2016

1. Basis of accounting

These interim condensed and consolidated financial statements do not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006. They have been prepared on the basis of the accounting policies as set out in the Group's Annual Report for the year ended 31 December 2015.

 

The interim report has been prepared in accordance with IAS 34 'Interim Financial Reporting' and the Listing Rules of the Financial Conduct Authority.

 

The Group has sufficient financial resources and contracts with a number of customers and suppliers such that the directors believe that the Group is well placed to manage its business risks successfully despite the continued uncertain economic outlook.

 

After making enquiries, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the interim report.

 

The Group's 2015 Annual Report is prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union, and is available on the Miton Group plc website (www.mitongroup.com).

 

These unaudited financial statements were approved and authorised for issue by a duly appointed and authorised committee of the Board of Directors on 21 September 2016.

 

The full year accounts to 31 December 2015 were approved by the Board of Directors on 18 March 2016 and have been delivered to the Registrar of Companies. The report of the Auditors on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under Section 498 of the Companies Act 2006. The figures for the six months ended 30 June 2016 and the six months ended 30 June 2015 have not been audited.

 

2. Segmental Reporting

The Group has one revenue stream, fund management fees, which are derived from the United Kingdom and Europe. The Group has one cash-generating unit.

 

3. Dividend

The dividend for the year ended 31 December 2015 was paid on 11 May 2016, being 0.67p per share. The trustees of the Employee Benefit Trust waived their rights to part of this dividend, leading to a total distribution of £1,011,638, which is reflected in the Interim Unaudited Consolidated Statement of Changes in Equity.

 

4. Exceptional operating expenses

Unaudited

Six months to

30 June 2016

£000

 

Unaudited

Six months to

30 June 2015

£000

 

Audited

Year to 31 December 2015

£000

Group restructuring costs

-


-

317

Cancellation of Growth Share Plan / New Remuneration Scheme

 

42


-

 

-


42


-

317

 

 

 

 

5. Taxation


Unaudited

Six months to

30 June 2016

£000

Unaudited

Six months to

30 June 2015

£000

Audited

Year to 31 December 2015

£000

Corporation tax charge


585

288

796

Deferred tax credit


-

(83)

(66)

Tax charge reported in the Interim Unaudited Consolidated Statement of Comprehensive Income


 

585

205

 

730

 

 

6. Earnings per share

Basic earnings per share is calculated by dividing the profit for the period attributable to ordinary equity shareholders of the parent company by the weighted average number of ordinary shares outstanding during the period.

At the period end the issued ordinary share capital of the Company totalling 170,921,274 is reduced by the weighted average number of shares held by the Group's Employee Benefit Trust. These shares do not have dividend rights.

In calculating diluted earnings per share, IAS 33 Earnings Per Share requires that the profit is divided by the weighted average number of ordinary shares outstanding during the period plus the weighted average number of any potential dilutive ordinary shares that would be issued on their conversion to ordinary shares during the period.

 

(a) Reported earnings per share

Reported basic earnings per share has been calculated as follows:


Unaudited

 Six months

To 30 June

2016

Unaudited

Six months

to 30 June

2015

Audited

Year to

31 December

2015

Net earnings attributable to ordinary equity holders of the parent for basic earnings (£000)

 

2,361

 

4288

1,395

Weighted average shares in issue (No. 000)

150,974

151,8412

151,653

Weighted average shares in issue - diluted (No. 000)

169,851

175,9233

184,820

Basic  earnings per share (pence)

1.56

0.28

0.92

Diluted Basic earnings per share (pence)

1.39

0.24

0.75

 

 

 

6. Earnings per share (continued)

 

(b) Adjusted earnings per share

Adjusted earnings per share is based on Adjusted Profit after tax, where Adjusted Profit is stated after charging interest and share-based payments but before amortisation, exceptional items and items relating to previous years.

 

Adjusted Profit for calculating adjusted earnings per share:

 

 

 

 

Unaudited

Six months

to 30 June

2016

£000

Unaudited

Six months

to 30 June

2015

£000

Audited

Year to

31 December

2015

£000

Profit before taxation for the period

2,946

633

2,125

Add back:




Exceptional operating expenses

42

-

317

Amortisation

150

414

768

VAT provision relating to prior years

-

(185)

(185)

Adjusted Profit before tax

3,138

862

3,025

Taxation:




Tax in the Consolidated Statement of Comprehensive Income

(585)

(205)

(730)

Tax effect of adjustments

(38)

(3)

(119)

Adjusted Profit after tax for the calculation of Adjusted earnings per share

2,515

654

2,176

 

Adjusted earnings per share and diluted earnings per share was as follows using the number of shares calculated at note 6(a):


Unaudited

Six months

to 30 June

2016

pence

Unaudited

Six months

to 30 June

2015

pence

Audited

Year to

31 December

2015

pence

Adjusted earnings per share

1.67

0.43

1.43

Diluted Adjusted earnings per share

1.48

0.37

1.18

 

The dilution arises largely as a result of the Miton Group plc shares which would be issued if all the Growth Share Plan shares with an accrued value at 30 June 2016, which will not fully vest until 2018, had vested and had been exchanged into Miton Group plc ordinary shares at 30 June 2016.

7. Cash and cash equivalents


Unaudited

30 June

2016

£000

Unaudited

30 June

2015

£000

Audited

31 December

2015

£000

Cash at bank and in hand

17,400

13,605

14,073

 

 

Within cash at bank is £nil (30 June 2015: £2,911,000) held for the account of creditors to the Company.

 

 

 

8. Provisions

Current

Other provisions

£000

Total

£000

At 1 January and 30 June 2016 (Unaudited)

-

-

 

 

At 1 January 2015

260

260

Utilised

(32)

(32)

Released

(228)

(228)

At 30 June 2015 (Unaudited) and 31 December 2015 (Audited)

-

-

 

Non-current



Other provisions

£000

Total

£000

At 1 January 2016



89

89

Provided



49

49

At 30 June 2016 (Unaudited)



138

138






At 1 January 2015



-

-

Provided



25

25

At 30 June 2015 (Unaudited)



25

25






At 1 January 2015



-

-

Provided



89

89

At 31 December 2015 (Audited)



89

89

 

Non-current provisions at the end of the period related to dilapidations for Group's offices at 6th Floor, Paternoster House, London.

 

9. Share capital

 

 

Authorised:

Unaudited

30 June

2016

£000

Unaudited

30 June

2015

£000

Audited

31 December

2015

£000

250,000,000 ordinary shares of 0.1 pence each

250

250

250

 

 

 

 

 

 

 

Allotted, called up and fully paid:

 
No of

ordinary

shares
0.1 pence

each

No. 000


Value of

ordinary

shares
0.1 pence

each
£000

At 1 January 2016, 30 June 2016 and 31 December 2015

170,921

171

 

 

 


 

10. Share-based payments

In the period to 30 June 2016 awards over 100 Growth Shares were granted (2015: 75). The fair value of the growth shares granted in the period was £93,000 (2015: £102,000) of which £10,342 was charged to the Interim Unaudited Consolidated Statement of Comprehensive Income in the period (year ended 31 December 2015: £11,000).

 

In the period to 30 June 2016 awards over 100,000 ordinary 0.1p MEI shares were granted (2015 full year: seven awards over 2,275,000 ordinary 0.1p shares). The fair value of the options granted in the period was £7,189 (2015: £132,000) of which £598 was charged to the Interim Unaudited Consolidated Statement of Comprehensive Income in the period (year ended 31 December 2015: £10,000).

 

The fair value of the Growth Shares are calculated using a Monte Carlo simulation adjusted discounted cash flow model using assumptions regarding volatility, growth in AuM, timing of exercise, employee exit and forfeiture rates and share price.

 

For MEI awards, the fair value was estimated as at the date of grant using a Black-Scholes model and based on employee exit and forfeiture rates, dividend yields, share price, composite volatility and performance conditions. The expected life of the incentives has been estimated taking account of the extent to which the exercise price was above or below the share price at date of grant. The annualised volatility has been based on historical trends, which have been assumed to indicate future volatility. The risk free interest rate has been based on the UK gilts rate with a maturity corresponding to the expected life of the option.

 

In the period to 30 June 2016 the total share-based payment charge was £240,000.  This charge includes a reduction of £428,000 in the cumulative expense related to prior years from forfeiture of awards during the period, in accordance with accounting standards.

 

11.  New Remuneration Scheme

The Growth Share Plan ('GSP') will be discontinued as the principal reward and retention mechanism for new fund managers and for those where no value has been accrued to date.  Where a team has accrued value they will retain the Growth Shares and exchange them over time in accordance with the rules of the scheme.

 

The Board has implemented a new remuneration structure from 1 July 2016. This new structure is based on the principle of a percentage revenue share arrangement linked to the cumulative performance of each strategy. Participants will be required to invest a portion of their variable remuneration earned into their strategies, in accordance with industry standards and deferral periods.  It will not require the issuance of Miton Group plc shares.

 

END

 

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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