Full Year Results

FRP Advisory Group PLC

Jul 22 2022 08:00 BSTSource: RNS

RNS Number : 3713T

FRP Advisory Group PLC

22 July 2022

FRP ADVISORY GROUP PLC

("FRP", the "Group" or the "Company")

Full Year Results

For the year ended 30 April 2022

FRP Advisory Group plc, a leading national specialist business advisory firm, is pleased to announce full year results for the year ended 30 April 2022.

Geoff Rowley, Chief Executive Officer of FRP Advisory Group plc, said:

"I am pleased to report another year of profitable growth. FRP is a resilient business, with a track record of growth regardless of the economic conditions.

The UK M&A mid-market remains active, our Corporate Finance team have an excellent pipeline to help clients realise their strategic ambitions.

Uncertainties still remain over how long troubled businesses can continue in their current form or how proactive key creditors like HMRC and institutional lenders will be on addressing over-due debts. Following the removal of government support, inflationary pressures and other disruptive forces, the Group has seen an increase in the level of enquiries for restructuring services in recent months.

The Group has a strong balance sheet and the Board believes the medium-term outlook for all the Group's markets is positive. Trading since 1 May 2022 is in line with the Board's expectations."

Financial highlights

	2022	2021
	£m	£m
Revenue	95.2	79.0
Adjusted underlying EBITDA*	25.7	23.0
Reported profit before tax	15.1	16.6
Adjusted Total EPS (pence)**	7.57	7.11
Basic EPS (pence)	5.35	6.06
Total dividend relating to year (pence)	4.3	4.1
Net cash	18.1	16.4

· £95.2 million revenue (2021: £79.0 million) an increase of 21%: 11% organic, 10% inorganic.

· Adjusted underlying EBITDA* rose by 12% to £25.7 million (2021: £23 million).

· Net cash of £18.1 million. Cash of £24.9 million less a balance remaining on a term loan of £6.8 million (2021: £24.4 million cash less structured debt of £8 million) after:

o paying down all except £1.3 million of IPO liabilities relating to Cessation profits owed to Partners and related tax liabilities. As at May 2022 all Partner IPO liabilities have been repaid.

o acquiring one business.

o the Group also has an undrawn revolving credit facility ("RCF") of £10 million.

· £1.2 million average revenue per Partner as at year end (2021: £1.1 million).

· £15.1 million reported Profit Before Tax for the year (2021: £16.6 million).

· Total dividends of 4.3p relating to FY2022 (2021: 4.1p), made up of three Interim dividends of 0.8p per eligible Ordinary Share and a final dividend of 1.9p per eligible Ordinary Share for the year ended 30 April 2022 recommended by the Board.

* Adjusted Underlying Earnings Before Interest Tax Depreciation and Amortisation (EBITDA) excludes share based payment expenses that arises from a) the Employee Incentive Plan (EIP) funded on IPO and b) deemed remuneration amortisation linked to acquisitions. See table in the Financial Review

** Earnings adjusted by adding back share based payments and related deferred tax. Earnings per total weighted shares in issue. See note 11 for more details.

Operational highlights

· Delivering on our strategy to achieve both organic and inorganic growth.

· 15% increase in FRP team size, supporting ongoing growth.

o The FRP team grew by 66 year on year to 504 excluding consultants (2021: 438).

o Growth was driven by demand-led lateral hiring and one acquisition. At 30 April 2022 the Group had 80 Partners (2021: 73), 317 other fee earners (2021: 277) and 107 support staff (2021: 88).

o At year end FRP's UK footprint covers 26 locations (2021: 22).

· Restructuring team again the most active in the administration appointment market

o Market Share in the number of FRP Administration appointments was consistent on an underlying basis at 13%, in a subdued Administrations market.

· FRP Corporate Finance has grown its market share to rank as the 12th most active financial adviser in the UK M&A market

o The Corporate Finance and Debt Advisory teams were involved in 99 successful transactions with an
aggregate deal value of £3 billion and £1.3 billion of debt raised.

o Nationally the Corporate Finance and Debt Advisory teams now comprises 73 fee earners (including 21 Partners) across 10 locations.

· The Group has been progressing projects to improve operational efficiencies and risk management, which include:

o The rollout of four new systems: a new CRM system, a new HR system, a Document Management System and an upgraded time recording system.

o Adopting a new Enterprise Risk Management (ERM) framework, which has enabled ISO 31000 certification in July 2022.

Post balance sheet events

· In May 2022 the final £1.3 million payment of the IPO liability relating to the Cessation profits owed to Partners was paid down.

· On 4 May 2022 393,700 new ordinary shares were issued as part of the acquisition of BridgeShield Asset Management Limited.

· In June 2022, the company executed a secondary placing and given the demand from investors, also raised an additional £7.5 million gross through the issue of new shares. Partner shareholders were invited to sell 20% of their holding in return for signing an extended lock-in to June 2024. This has enabled us to introduce new institutional shareholders onto the share register and further bolster our strong balance sheet as we continue to target acquisitions. Currently 48.6% of the Group's shareholder base is now subject to lock-in arrangements, including the Group Employee Benefit Trust (10.8%).

· On 21 June 2022 4,412,176 ordinary shares were transferred to the Employee Benefit Trust for nil consideration, from a former Partner of the Group.

· The Board recommends a final dividend of 1.9p per eligible ordinary share for the financial year ended 30 April 2022. Subject to approval by shareholders, the final dividend will be paid on 21 October 2022 to shareholders on the Company's register at close of business on 23 September 2022. If the final dividend is approved, the total dividends declared by the Company relating to the financial year ended 30 April 2022 will be 4.3p per eligible ordinary share.

The information contained within this announcement is deemed by the Group to constitute inside information under the Market Abuse Regulations No. 596/2014.

Management will host a presentation for analysts this morning at 09:30am, for details, please contact FRP@mhpc.com.

Enquiries:

FRP Advisory Group plc

Geoff Rowley, CEO

Jeremy French, COO

Gavin Jones, CFO

Enquiries via MHP

Cenkos Securities plc (Nominated Adviser and Sole Broker)

Katy Birkin/Max Gould (Corporate Finance)

Alex Pollen (Sales)

Tel: +44 (0) 207 397 8900

MHP Communications (Financial Public Relations)

Oliver Hughes

Charlie Barker

Pete Lambie

Tel: +44 (0) 20 3128 8570

FRP@mhpc.com

Notes to Editors

FRP is a professional services firm established in 2010 which offers a range of advisory services to companies, lenders, investors and other stakeholders, as well as individuals. These services include:

· Restructuring advisory: corporate financial advisory, formal insolvency appointments, informal restructuring advisory, personal insolvency and general advice to all stakeholders.

· Corporate finance: mergers & acquisitions (M&A), strategic advisory and valuations, financial due diligence, capital raising, special situations M&A and partial exits.

· Debt advisory: raising and refinancing debt, debt amendments and extensions, restructuring debt, asset based lending and corporate and leveraged debt advisory.

· Forensic services: forensic investigations, compliance and risk advisory, dispute services and forensic technology.

· Pensions advisory: pension scheme transaction advisory, pension scheme restructuring advisory, covenant advisory and corporate governance

Chairman's report

Overview

Since our IPO in March 2020, both FRP and the business community at large have wrestled with the challenges of operating in a global pandemic and increasingly volatile economic environment. Few had the ability to revert to a well-thumbed playbook and for most it was a case of needing to show clear and decisive leadership, coupled with flexibility and responsiveness. It is against this background that I am delighted to report on another year of excellent progress for FRP. In achieving this, I am hugely appreciative and proud of the commitment, professionalism and dedication of our FRP colleagues, who continued to focus on the needs of our clients in an ever-changing environment.

The UK restructuring market during this period has remained subdued. For much of the pandemic government support measures created liquidity, enabling businesses to manage through the crisis. However, for a period following the removal of the UK Government support measures, the expected influx of corporate failures did not occur as lenders, Government forbearance and available liquidity continued to provide a lifeline for many businesses. This artificially low level of insolvency appointments started to increase during the second half of calendar 2021 and into 2022, driven by an increase in creditors voluntary liquidations ("CVLs"). The Administration market is one of FRP's key areas of focus, as it enables us to work with slightly larger businesses, where we can deploy the wide range of skill sets contained across the FRP national network. Here, as expected, the increased activity has been slower to return, although this market is now starting to show clear signs of returning to growth. Notwithstanding this, we are pleased to be able to report we maintained our administration market share during the year. If business leaders thought better times were returning as the pandemic's threat receded, then sadly they were disappointed as new challenges arose. These included supply chain disruption, energy cost increases, labour shortages, rising inflation and interest rates, all emerging at the same time as war on the doorstep of Europe creating further turmoil. It is therefore unsurprising that following the removal of UK government support measures and the onset of serious headwinds facing UK corporates, the Group has seen an increase in the level of enquiries for restructuring services in recent months. In May and June 2022 the administration appointments show this market is up on prior year but still below pre-pandemic 2019 levels.

Despite challenging trading conditions for certain parts of the economy, FRP Corporate Finance had a busy and successful year, significantly growing its market share to rank as the 12th most active financial adviser in the UK M&A market. We have invested in this service line over the last couple of years, both organically and through acquisition. Within the UK mid-market arena there continues to be strong liquidity despite softening in the public markets. The opportunity for corporate M&A occurs across all economic cycles and the FRP team is available to help more clients reach their strategic ambitions. The private equity funds have significant sums of uninvested capital available, which they are always looking to put to work at the right price, that reflects the prevalent market outlook. Debt Advisory, which also works in similar markets to both Restructuring and Corporate Finance, is also well placed to support businesses in the more challenging environment over the coming months. Our developing pillars, Pensions Advisory and Forensic Services continue to be important cogs in ensuring that we can offer a full range of advisory services to our introducer base and their clients. Connecting our five specialist service pillars across our national office network where we can, remains core to our operating strategy.

Continued profitable growth

We are pleased with the levels of growth during the year, with revenues of £95.2 million, up 21% from the previous year (2021: £79.0 million). The growth was driven by organic (11%), underpinned by the support offered on some larger projects, with 10% coming from the acquisitions. Following an acquisition we treat the first 12 months contribution to the Group as inorganic, month 13 onwards becomes organic.

Adjusted underlying EBITDA of £25.7 million grew by 12% from the previous year (2021: £23.0 million). Reported EBITDA was £17.7 million (2021: £18.4 million). During the year we were pleased to welcome 66 new colleagues and the overall headcount grew 15% in the year, to 504 (2021: 438). In addition, the Partner cohort expanded by 7, to 80.

Strong balance sheet

The Group's balance sheet remains strong with net cash balances at 30 April 2022 of £18.1 million (2021: £16.4 million), consisting of gross cash of £24.9 million less a balance remaining on a term loan of £6.8 million. The Group also has an undrawn revolving credit facility ("RCF") of £10 million with Barclays Bank.

Our balance sheet was strengthened further post period end, with the successful raising of £7.5 million gross through a significantly oversubscribed placing of new shares. I would like to both welcome and thank our new and existing shareholders who participated in the Placing and look forward to continuing on our growth journey with them.

Shortly after year end the Group repaid all IPO liabilities due to Partners, with a final payment of £1.3 million in May 2022. Net cash of £18.1 million (2021: £16.4 million), an undrawn £10 million RCF, the recent placing raising £7.5 million and the ability to issue further equity, gives the Group sufficient options to act as acquisition opportunities arise, subject to our selective criteria of cultural fit, strategic fit and mutually acceptable transaction economics.

Strategy

Our strategy remains to seek steady and sustainable growth through organic initiatives and selective acquisition opportunities. We are delighted to welcome the team from BridgeShield Asset Management Limited which we acquired in April 2022 as well as colleagues in a further four new locations, bringing our office footprint to 26 locations. The Group explored several acquisition opportunities where we did not transact due to our highly selective approach of cultural fit, strategic fit, and acceptable deal economics. We continue to explore opportunities nationally across each of our five service pillars.

Further details are set out in the Strategic Report in FRP's Annual Report & Accounts.

Dividend

The dividend policy of the Group from 2021 is to pay dividends quarterly. The anticipated dividend pay-out ratio is c.70% of the Group's reported Profit After Tax, to eligible shareholders.

The FRP Group Employee Benefit Trust which was seeded by Partners on IPO and holds shares backing employee options, has waived its right to dividends and the corresponding amount was retained by the Group. Once the employee shares vest, on or after 6 March 2023, these shares will then attract dividend rights.

The Board recommends a final dividend of 1.9p per eligible ordinary share for the financial year ended 30 April 2022. Subject to approval by shareholders, the final dividend will be paid on 21 October 2022 to shareholders on the Company's register at close of business on 23 September 2022. If the final dividend is approved, the total dividends paid by the Company relating to the financial year ended 30 April 2022 will be 4.3p per eligible ordinary share (2021: 4.1p).

Robust corporate governance

The Board firmly believes that a robust governance structure is appropriate to optimise decision making for the business and its wider stakeholders. To support this, FRP adopted the Quoted Companies Alliance ("QCA") Corporate Governance Code in 2020 and you can find more information on our governance arrangements in the Corporate Governance Statement on pages 37 to 40 of the Group's Annual Report & Accounts. Further information on our Corporate Governance structure is also available on our website at https://www.frpadvisory.com/investors/corporate-governance/.

Greater focus is being placed on our Environmental, Social and Governance responsibilities and we have committed to the Group being carbon neutral by 2030.

Our people

As a people business, FRP recognises the importance of keeping all colleagues motivated, engaged and incentivised to perform at their best. We work hard to retain our friendly, collaborative, entrepreneurial and meritocratic culture.

The Board were delighted to implement an Employee Incentive Plan in 2020. This enabled granting employees at IPO options over FRP shares which were backed 1:1 by FRP shares in issue and held within an Employee Benefit Trust (EBT). Employees were granted options subject to their service, which become exercisable 3 years from IPO. As the EBT had headroom and the ability to be replenished if IPO Partners left, the Board has been able to make additional awards to new joiners (including Partners) since IPO to ensure colleagues have an ownership stake (including indirectly via options) in the business.

We believe that we are becoming an increasingly attractive destination for qualified and skilled people, with our regional office network and strong culture offering considerable appeal in the marketplace. Retaining and developing our team in a world where the competition for talent will become more intense is a key priority and greater investment in this area will be made in the coming years.

Annual General Meeting

The Company's Annual General Meeting will be held on 15th September 2022. The Notice of Annual General Meeting will be posted in due course to those shareholders who opted to receive hard copy communications and a copy will also be made available on our website at https://www.frpadvisory.com/investors/financials-documents/.

Looking ahead

Despite the negative and uncertain outlook being faced currently by the UK economy, I am positive that FRP's relevant and collective skill set remains highly sought after by our clients and advisers. Although we have only been listed for just over two years, FRP has been in existence as an independent business for 12 years and during this time has seen many changes in the economic landscape and has flexed its business model accordingly to maximise its competitive advantage. As a result, I remain confident in our ability to both navigate uncertain times and indeed deploy our considerable expertise exactly where it is needed. Current year trading reflects this and is in line with expectation. We are grateful for the trust that our clients continue to demonstrate in us and once again thank all of our colleagues without whom our success would not be possible.

Nigel Guy

Non-Executive Chairman

22 July 2022

Chief Executive Officer's report

We have achieved another strong set of results by staying focused on doing the basics well and giving clients honest, clear and considered advice.

Resilient and diversified business

With roots in restructuring, FRP has now evolved into a leading business advisory firm with specialists supporting businesses throughout the corporate lifecycle across our five complementary service pillars.

The five service pillars are: Corporate Finance, Debt Advisory, Forensic Services, Pensions Advisory and Restructuring Advisory. We specialise in finding strategic solutions to a range of situations for clients of all sizes, including personal clients, SME's, our core mid-market and high-profile more complex, appointments.

We believe our agile, collaborative and entrepreneurial approach sets us apart from our peers.

Selective acquisitions, in line with our strategy

Our focus is organic growth, supplemented with selective acquisitions that meet our strict criteria of:

· A cultural fit,

· A strategic fit, and

· Mutually acceptable transaction economics.

The acquisition of BridgeShield Asset Management Limited on 28 April 2022 expands our service offering to cover Property Asset Management services to specialist lenders nationally. The firms' two Directors, Ben Hubbard and Nick McAuliffe, joined FRP as Partners. The team, including three colleagues and two consultants, are based at FRP Leigh-on-Sea.

Our strong balance sheet gives us the flexibility to move quickly should further acquisition opportunities arise.

Continued growth in UK footprint and team

At 30 April 2022, FRP had 26 offices and 504 colleagues, excluding consultants. The team grew 15% or by 66 colleagues year on year (2021: 438).

Highlights were:

· In October 2021 we opened a new office in Cambridge, led by a new lateral Partner hire, Dan Bowtell, giving us a wider footprint in East Anglia.

· In November 2021 we opened a new office in Glasgow, comprising two Partners Michelle Elliot and Stuart Robb, and 12 colleagues. All three of our Scottish offices now share business and market intelligence, giving us greater visibility and impact in their localities.

· In March 2022 we opened an office in Southampton with the appointment of a new Partner, Sandy Kinninmonth.

· In April 2022, we extended our footprint in the North East, with a new office in Sunderland.

· Also in April 2022, we acquired BridgeShield Asset Management Limited with Nick McAuliffe and Ben Hubbard joining FRP as Partners. FRP Leigh-on-Sea is a second Essex location alongside FRP Brentwood.

Strong trading results

FRP's revenue grew 21% year on-year to £95.2 million (2021: £79.0 million). 11% was organic, inorganic growth was 10%. Following an acquisition we treat the first 12 months contribution to the Group as inorganic, month 13 onwards becomes organic. Adjusted underlying EBITDA grew 12% year-on-year to £25.7 million (2021: £23.0 million). We maintain a focus on cost control, whilst modestly investing where necessary to continue sustainable profitable growth. On a reported basis, EBITDA was £17.7 million (2021: £18.4 million), with the decline due to an increase in non-cash share based payment charges.

Across all offices there is a constant focus on accurate monthly unbilled revenue (work in progress, WIP) valuation and managing cash collections. I am pleased to report that after completing one acquisition in this Financial year, we closed the year with net cash of £18.1 million (2021: £16.4 million). I am also pleased to report that in May 2022 all IPO liabilities to Partners (and HMRC) have now been repaid.

Restructuring Market

Significant government support measures were made available to both sound and struggling businesses alike during the pandemic, which have continued to impact the more complex Administration market. Despite this, FRP's Restructuring team had another strong year.

The higher volume and typically more straightforward liquidation market (including Company Voluntary Liquidation's ("CVLs") and Compulsory Liquidations) increased by 68% in our financial year, however the more complex Administration market, where FRP are particularly active, declined by 22% year-on-year. Despite this, FRP's Administration market share, by number of appointments, was consistent year-on-year on an underlying basis at 13%. (Source: London and Regional Gazettes). We continued to serve the full range of UK clients across all sectors, including personal clients and SMEs, along with the core mid-market and high-profile appointments.

UK M&A Market

In the financial year, FRP Corporate Finance was launched, which integrated the existing Corporate Finance team with the JDC and Spectrum acquisitions in the prior year. The Corporate Finance team was involved in 99 successful transactions with an aggregate deal value of £3 billion and £1.3 billion of debt raised. This level of activity gives FRP Corporate Finance a 1% market share of the UK M&A market, by number of appointments (Source: Experian). The average deal value of £30 million places FRP Corporate Finance in the heart of its target SME market, with deals ranging in value from £3 million to £150 million.

FRP Corporate Finance remains strong in its commitment to the private equity community with over half of the deals in the period involving private equity: including buy-side, sell-side and debt advisory transactions.

· Notable FRP Corporate Finance transactions in H2 2022 included:

o Sell-side adviser to Emma's Diary, an online communication platform for pregnant women and new mothers, in its sale to Everyday Health Group Pregnancy & Parenting.

o Sell-side adviser to Mr Fothergill's Seeds, a supplier of garden products, in a £100 million+ buyout backed by Harwood Private Capital.

o Debt adviser on the £357.5 million ABL facility to help fund the acquisition of McKesson UK, the parent company of Lloyds Pharmacy Group, by AURELIUS.

o Sell-side adviser to Ludlow Healthcare Group, a specialist care provider, to Holmleigh Care Group.

o Sell-side adviser to SSQ, a legal recruitment consultancy, to an Employee Ownership Trust.

· FRP's Corporate Finance and Debt Advisory teams now comprise 76 fee earners (including 21 Partners) across 10 locations and we have seen a positive impact on revenue from our FY2021 acquisitions.

Forensic Services and Pensions Advisory Markets

The Forensic Services team continue to be engaged on a variety of complex disputes and investigations, many of which are confidential in nature. The last year has seen the team grow their footprint in the Midlands and in East Anglia. Over the next year or so, more international opportunities are expected, as we continue to integrate this service with 8 International, a global advisory organisation that was set up to meet a growing demand for dedicated financial and operational support from businesses with an international footprint.

The Pensions Advisory team has continued to provide services to scheme trustees and sponsoring employers navigating through the ever changing regulatory landscape. The implementation of the Pension Schemes Act 2021 legislation continues to bring a new dynamic to stakeholder considerations on corporate transactions and the team have been working with their colleagues in Corporate Finance and Debt Advisory to support their clients. Since last reporting, the Pensions Advisory team have assisted clients to complete transactions, agree significant forbearance to support sponsoring employers' strategies but equally, particularly in the food and on-line retail sectors, advised trustees in securing scheme buy-out obligations.

Empowering our outstanding people

As a professional services business, we understand that our people are central to our success and our most valuable asset. As well as offering competitive financial rewards, we offer opportunities for our team members to grow within the business and reach their full potential.

During FY2022 the Group conducted a cultural survey with colleagues. Overall, the feedback was very positive with colleagues feeling the internal culture was excellent. However, we acknowledge that there will always be room for improvement and the Board is constantly seeking feedback on ways the business can develop. Here are a few things that were implemented in FY2022:

· Hired a specialist Learning & Development Senior Manager as we continue to invest in this area, to support the continued development of our nationwide team.

· Rolled out Ideadrop - an innovation platform for colleagues to share ideas

· Established an Environment, Social and Governance ("ESG") committee

· Continued support of colleagues in acquiring professional qualifications and supporting their career aspirations, including for promising young stars to become future Directors and Partners of the business

We work hard to attract and retain highly skilled professionals by creating a rewarding, high-performance environment. We believe highly engaged colleagues deliver excellent client service and results, and in turn, strengthen our reputation in the market.

I am immensely grateful for all the hard work and commitment of all colleagues, who contribute so much to the Group's success.

Outlook

FRP continues to demonstrate resilience, with a track record of growth regardless of the economic conditions. At FRP our five service pillars work together to provide solutions that achieve the best possible outcomes; while colleagues are able to work seamlessly and service clients remotely we all appreciate the ongoing value of working together physically with clients and colleagues. As a UK focused business, the Russia/Ukraine conflict does not have a material impact on FRP's operations.

The medium term outlook for our key markets remains positive. Our Corporate Finance team have an excellent pipeline to help clients realise their strategic ambitions. Despite softening in the capital markets, mid-market M&A activity levels are strong with institutional lenders and private equity well financed with significant capital to deploy; plus there is also considerable overseas interest in UK assets. Our Restructuring team are well-positioned to service the expected increase in demand stemming from the increasing challenges and disruption emerging in the economy. However, uncertainties still remain over how long the available corporate liquidity and government backed loans can sustain troubled businesses or how proactive key creditors like HMRC and institutional lenders will be on addressing over-due debts.

The Group has a strong balance sheet and a network of offices that are connected to ensure each project is serviced by the right team of specialists from across the UK. In the current financial year, we plan to continue making progress in areas which we can control to deliver our strategy of sustainable profitable growth.

Current year trading to date is in line with Board expectation.

Geoff Rowley

Chief Executive Officer

22 July 2022

Financial review

The following is an extract from the Strategic Report, which can be found in the Company's Annual Report.

Financial review

Revenue

FRP's revenue grew 21% year on-year to £95.2 million (2021: £79.0 million). 11% was organic growth and 10% inorganic, defined as an acquisition's first 12 months contribution to the Group. Inorganic growth was mainly due to the Corporate Finance businesses acquired in the prior year. Adjusted underlying EBITDA grew 12% year-on-year to £25.7 million (2021: £23.0 million). We continue to maintain a focus on cost control while modestly investing, to continue executing on delivering sustainable profitable growth.

Adjusted underlying Earnings Before Interest Tax Depreciation and Amortisation (EBITDA)

The Group grew profitably with adjusted underlying EBITDA* rising by 21% to £25.7 million (2021: £23.0 million).

£m	2022	2021
Reported profit before tax	15.1	16.6
Add back depreciation, amortisation and interest	2.6	1.8
Reported EBITDA	17.7	18.4

Add share based payment expense relating to the Employee Incentive Plan (EIP)	5.4	3.7
Add share based payment expense - Deemed remuneration	2.6	0.9
Adjusted underlying EBITDA*	25.7	23.0

*Adjusted underlying EBITDA excludes any exceptional costs and share based payment expenses that arises from a) the Employee Incentive Plan (EIP) funded on IPO and b) deemed remuneration amortisation linked to acquisitions.

FRP team growth

The FRP team grew by 15% through both acquisition and demand-led lateral hiring and we opened four new offices in Cambridge, Glasgow, Southampton and Sunderland and a second Essex location in Leigh-on-Sea, following the acquisition of BridgeShield Asset Management Limited.

The Group started the financial year with 438 colleagues, (excluding consultants) operating out of 22 offices. By 30 April 2022, this number had increased to 504 (excluding consultants), operating out of 26 offices, as set out in the table below:

Team	FY 2022	FY 2021
Partners	80	73
Colleagues - fee earners	317	277
Total fee earners	397	350
Colleagues - support	107	88
Total (exc Consultants)	504	438

Balance sheet and cash flow

The Group's balance sheet remains strong with an unaudited net cash balance as at 30 April 2022 of £18.1 million (2021: £16.4 million), consisting of gross cash of £24.9 million less a balance remaining on a term loan of £6.8 million. The Group also has an undrawn RCF of £10 million with Barclays Bank.

The Group has repaid all IPO liabilities due to Partners, after a final payment of £1.3 million was made in May 2022.

Dividend

Given the trading performance and strong balance sheet, the Board intends to propose a final dividend, in line with its stated dividend policy to pay dividends quarterly. The expected dividend pay-out ratio is 70% of the Group's reported Profit After Tax, to eligible shareholders.

The FRP Staff Employee Benefit Trust which was seeded by Partners on IPO and which holds shares that back employee options, has waived its right to dividends and the corresponding amount was retained by the Group. Once the employee shares vest, on or after 6 March 2023, these shares will then attract dividend rights. The Board recommends a final dividend of 1.9p per eligible ordinary share for the financial year ended 30 April 2022. Subject to approval by shareholders, the final dividend will be paid on 21 October 2022 to shareholders on the Company's register at close of business on 23 September 2022. If the final dividend is approved, the total dividends paid by the Company relating to the financial year ended 30 April 2022 will be 4.3p per eligible ordinary share (2021: 4.1p).

The Group have changed their dividend recognition policy. Previously the Group recognised interim dividends at the point when the Board declared publicly, however going forward the Group will recognise interim dividends when paid. The impact of this change results in the de-recognition of a £1.8 million interim divided liability in FY2021 as it was paid in FY2022, with a corresponding increase in net assets and retained earnings of the same amount. There was no impact on the Group's profit or cash flows for the year ended 30 April 2021.

Consolidated statement of comprehensive income

For the year ended 30 April 2022

		Year Ended	Year Ended
		30 April 2022	30 April 2021
	Notes	£'000	£'000

Revenue		95,156	78,987

Personnel Costs	7	(58,796)	(46,572)
Depreciation and amortisation		(2,131)	(1,551)
Other operating expenses		(18,618)	(14,027)

Operating profit	6	15,611	16,836

Finance costs	9	(495)	(233)

Profit before tax		15,116	16,604
Taxation	10	(3,205)	(2,993)

Profit and total comprehensive income for the year attributable to the owners of the Group		11,911	13,611

Earnings per share (in pence)
Total	11	4.90	5.69
Basic	11	5.35	6.06
Diluted	11	5.04	5.81

All results derive from continuing operations.

The notes form part of these financial statements.

Consolidated statement of financial position

As at 30 April 2022

		As at	As at
		30 April 2022	30 April 2021 (restated)
	Notes	£'000	£'000

Non-current assets
Goodwill	12	10,200	9,600
Other intangible assets	12	727	794
Property, plant and equipment	13	2,847	2,241
Right of use asset	13	6,279	3,527
Deferred tax asset	18	2,431	925
Total non-current assets		22,484	17,087

Current assets
Trade and other receivables	14	46,063	42,373
Cash and cash equivalents	15	24,924	24,383
Total current assets		70,987	66,756

Total assets		93,471	83,843

Current liabilities
Trade and other payables	16	30,159	32,888
Loans and borrowings	17	2,000	1,600
Lease liabilities	17	1,365	872
Total current liabilities		33,524	35,360

Non-current liabilities
Other creditors	16	5,716	5,531
Loans and borrowings	17	4,800	6,400
Lease liabilities	17	4,913	2,768
Total non-current liabilities		15,429	14,699

Total liabilities		48,953	50,059

Net assets		44,518	33,784

Equity
Share capital	20	243	243
Share premium	25	23,730	23,730
Treasury shares reserve	25	(23)	(19)
Share based payment reserve	25	(1,139)	(4,135)
Merger reserve	25	1,287	1,287
Retained earnings	25	20,420	12,678
Shareholders' funds		44,518	33,784

Approved by the Board and authorised for issue on 22 July 2022.

Jeremy French Gavin Jones

Director Director

Company Registration No. 12315862

Consolidated statement of changes in equity

As at 30 April 2022

	Called up share capital	Share premium account	Treasury share reserve	Share based payment reserve	Merger reserve	Retained earnings	Total equity
	Called up share capital	Share premium account	Treasury share reserve	Share based payment reserve	Merger reserve	Retained earnings	Total equity
	£'000	£'000	£'000	£'000	£'000	£'000	£'000

Balance at 30 April 2020	238	18,975	(19)	361	(90)	1,037	20,502

Profit and total comprehensive income for the year	-	-	-	-	-	13,611	13,611
Other movements	-	-	-	-	-	20	20
Issue of share capital	5	4,755	-	-	1,377	-	6,137
Dividends (restated)	-	-	-	-	-	(4,990)	(4,990)
Share based payment expenses	-	-	-	3,700	-	-	3,700
Deemed remuneration	-	-	-	(5,196)	-	-	(5,196)
Transfer to retained earnings	-	-	-	(3,000)	-	3,000	-

Balance at 30 April 2021 (restated)	243	23,730	(19)	(4,135)	1,287	12,678	33,784

Profit and total comprehensive income for the year	-	-	-	-	-	11,911	11,911
Other movements	-	-	(4)	-	-	4	-
Dividends	-	-	-	-	-	(9,173)	(9,173)
Share based payment expenses	-	-	-	5,402	-	-	5,402
Unwind of deemed remuneration	-	-	-	2,594	-	-	2,594
Transfer to retained earnings	-	-	-	(5,000)	-	5,000	-

Balance at 30 April 2022	243	23,730	(23)	(1,139)	1,287	20,420	44,518

Consolidated statement of cash flows

As at 30 April 2022

	Year Ended	Year Ended
	30 April 2022	30 April 2021
	£'000	£'000

Cash flows from operating activities
Profit before taxation	15,116	16,604
Depreciation, amortisation and impairment (non cash)	2,131	1,551
Share based payments: employee options	5,402	3,700
Share based payments: deemed remuneration	2,594	943
Net finance expenses	495	232
Increase in trade and other receivables	(3,571)	(2,833)
Decrease in trade and other payables	(2,431)	(4,982)
Tax paid	(5,462)	(4,447)
Net cash from operating activities	14,274	10,768

Cash flows from investing activities
Purchase of tangible assets	(1,398)	(1,114)
Acquisition of subsidiaries less cash acquired	(365)	(10,599)
Acquisition of trade and assets	-	(1,610)
Net cash used in investing activities	(1,763)	(13,322)

Cash flows from financing activities
Proceeds from share sales	-	3,760
Dividend	(9,173)	(4,990)
Principal elements of lease payments	(1,165)	(911)
Drawdown of new loans	-	8,000
Repayment of loans and borrowings	(1,200)	-
Interest paid	(432)	(233)
Net cash (used in) / generated from financing activities	(11,970)	5,626

Net increase in cash and cash equivalents	541	3,072
Cash and cash equivalents at the beginning of the year	24,383	21,311
Cash and cash equivalents at the end of the year	24,924	24,383

Notes to the financial statements

For the year ended 30 April 2022

1. General information

FRP Advisory Group plc (the "Company") and its subsidiaries' (together "the Group") principal activities include the provision of specialist business advisory services for a broad range of clients, including restructuring and insolvency services, corporate ﬁnance, debt advisory, forensic services and pensions advisory.

The Company is a public company limited by shares registered in England and Wales and domiciled in the UK. The address of the registered ofﬁce is 110 Cannon Street, London, EC4N 6EU and the company number is 12315862.

2. Signiﬁcant accounting policies

The following principal accounting policies have been used consistently in the preparation of the consolidated ﬁnancial statements:

2.1 Basis of preparation

These financial statements have been prepared in accordance with UK-adopted International Accounting Standards ('IFRS') and with the requirements of the Companies Act 2006 as applicable to companies reporting under those standards.

The ﬁnancial statements are prepared in sterling, which is the presentational currency of the Group. Amounts in these ﬁnancial statements are rounded to the nearest £'000, unless otherwise stated.

2.2 Historic cost convention

The ﬁnancial statements have been prepared under the historical cost convention.

2.3 Basis of consolidation

The ﬁnancial statements incorporate the results of FRP Advisory Group plc and all of its subsidiary undertakings as at 30 April 2022.

FRP Advisory Trading Limited has eight wholly owned subsidiaries, FRP Debt Advisory Limited, FRP Corporate Finance Limited, Litmus Advisory Limited, Abbott Fielding Limited, JDC Accountants & Business Advisors Limited, JDC Holdings Limited, Spectrum Corporate Finance Limited, and BridgeShield Asset Management Limited, as well as being a member of FRP Advisory Services LLP and Apex Debt Solutions LLP.

During the year the Group completed one acquisition. The assets, liabilities and entity acquired have been consolidated within these Financial Statements, in accordance with IFRS 3. The newly acquired entity is BridgeShield Asset Management Limited.

2.4 New and amended standards adopted by the Group

The Group has applied the following new standards and interpretations for the first time for the annual reporting period ending 30 April 2022:

· IFRS 9 Financial Instruments, IAS 39 Financial Instruments: Recognition and Measurement, IFRS 7 Financial Instruments: Disclosures, IFRS 4 Insurance Contracts and IFRS 16 Leases (Amendments): Interest Rate Benchmark Reform - Phase 2

· IFRS 4 Insurance Contracts (Amendment): Extension of the Temporary Exemption from Applying IFRS 9

· IFRS 16 Leases (Amendment): Covid-19-related Rent Concessions Beyond 30 June 2021

The adoption of the standards and interpretations listed above has not led to any changes to the Group's accounting policies or had any material impact on the financial position or performance of the Group.

2.5 Standards issued but not yet effective

At the date of authorisation of these financial statements, the following standards and interpretations relevant to the Group and which have not been applied in the financial statements, were in issue but were not yet effective.

The Group's and Company's management have reviewed the application of the amendments and have concluded that there is no expected material impact on the Group and Company financial statements.

Standard	Effective date, annual period beginning on or after
IAS 16 Property, Plant and Equipment (Amendment): Proceeds Before Intended Use	1 January 2022
IAS 37 Provisions, Contingent Liabilities and Contingent Assets: (Amendment): Onerous Contracts - Cost of Fulfilling a Contract	1 January 2022
IFRS 3 Business Combinations (Amendment): Reference to the Conceptual Framework	1 January 2022
Annual Improvements to IFRSs (2018 - 2020 cycle)	1 January 2022
IAS 1 Presentation of Financial Statements (Amendment): Classification of Liabilities as Current or Non-current and Classification of Liabilities as Current or Non-current - Deferral of Effective Date	1 January 2023
IAS 1: Presentation of Financial Statements and IFRS Practice Statement 2 Making Materiality Judgements (Amendment): Disclosure of accounting policies	1 January 2023
IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors: Amendments in relation to the definition of accounting estimates	1 January 2023
IAS 12 Income Taxes: Amendments in relation to deferred tax related to assets and liabilities arising from a single transaction	1 January 2023
IFRS 17 Insurance Contracts and Amendments to IFRS 17	1 January 2023
IFRS 17 Insurance Contracts (Amendment): Initial Application of IFRS 17 and IFRS 9 - Comparative Information	1 January 2023

2.6 Going concern

The business has been, and is currently, both proﬁtable and cash generative. It has consistently grown year on year for 12 years and has proved to be resilient, growing in both periods of economic growth and recession.

At year end the Group had net cash of £18.1 million. The Group entered into an £8 million structured term loan repayable over five years, during FY2021 and had £6.8 million outstanding at 30 April 2022. The Group also has available an undrawn £10 million committed revolving credit facility ("RCF"). Ongoing operational cash generation and this cash balance mean we have sufﬁcient resources to both operate and move swiftly should acquisition opportunities arise. As seen post year end, the Group also has the capacity to raise funds through share issue, demonstrated with the £7.5 million raise as part of a secondary placing transaction.

The quality of client service, strong referral network and barriers to enter the market, together with the strong cash position, make the Board conﬁdent that the company will continue to grow. In terms of diversiﬁcation, ofﬁces can adapt quickly to supporting each other and work on both higher value assignments or higher volume, lower value jobs. Pensions Advisory, Forensic Services, Corporate Finance and Debt Advisory can both support the Restructuring Advisory offering and also earn fees autonomously.

Management have conducted sensitivity analysis by reducing revenue by over 50% and separately decreasing margin by 75%: both scenarios show FRP to be in a strong financial position with available cash resources. These sensitivities represent extreme scenarios that are highly unlikely to occur.

In the unlikely event that the business had a signiﬁcant slowdown in cash collections the business has a number of further options available to preserve cash.

FRP was able to operate seamlessly during the pandemic and is well placed to manage future developments. As a UK focused business the Russia/Ukraine conflict does not have a material impact on FRP's operations.

Having due consideration of the ﬁnancial projections, the level of structured debt and the available facilities, it is the opinion of the Directors that the Group has adequate resources to continue in operation for a period of at least 12 months from signing these financial statements and therefore consider it appropriate to prepare the Financial Statements on the going concern basis

2.7 Deemed Remuneration

Deemed remuneration arises during acquisitions, where an element of the consideration has an equity component and is subject to a lock-in period, in order to retain the fee earners post acquisition. This equity compensation is not treated as part of the cost of acquisition but is reflected in the share based payment reserve and amortised through the statement of comprehensive income as a share-based payment staff cost, over the lock-in period.

2.8 Subsidiaries

Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity.

The ﬁnancial statements of trading subsidiaries are included in the consolidated ﬁnancial statements from the date control is achieved until the date that control ceases. The accounting period of the subsidiaries are changed when necessary to align them with that of the Group.

2.9 Transactions eliminated on consolidation

Intra-Group balances, and any gains and losses or income and expenses arising from intra-Group transactions, are eliminated in preparing the historical ﬁnancial information. Losses are eliminated in the same way as gains, but only to the extent that there is no evidence of impairment.

2.10 Foreign currencies

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the income statement for the period.

2.11 Revenue recognition and unbilled revenue

Revenue is recognised when control of a service or product provided by the Group is transferred to the customer, in line with the Group's performance obligations in the contract, and at an amount reﬂecting the consideration the Group expects to receive in exchange for the provision of services.

Revenue from contracts with customers is recognised when the Group satisﬁes a performance obligation for a contracted service. The Group applies the following ﬁve step model:

· Identify the contract with a customer;

· Identify the individual performance obligations within the contract;

· Determine the transaction price;

· Allocate the price to the performance obligations; and

· Recognise revenue as the performance obligations are fulfilled.

The Group considers the terms of engagement, either through court appointment or otherwise agreed, issued to customers to be contracts.

There are no signiﬁcant judgements required in determining the Group's performance obligations in its contracts as the signiﬁcant majority of contracts contain only one performance obligation.

Transaction price is determined by agreed hourly rates or a ﬁxed fee stated within the letters of engagement or court appointment. If the fee basis is ﬁxed or time based, the provisioning method is based on estimated recoverability of the current unbilled revenue with reference to the billing to date and future billing to be performed as a proportion of costs to date and estimated costs to complete the contract.

Where work is contingent and not based on time-cost, fees are fully provided until performance obligations are satisﬁed as at this point there is no risk of a material reversal of revenue. Contingent work generally includes investigations, corporate ﬁnance services, some forensic work, and other assignments where the outcome is determined by either a judge, pre-trial agreement or completion of a transaction. The Group adopts a prudent approach in only recognising revenue on cases that have been resolved with all costs incurred expensed in the relevant month.

The Group recognises revenue from the following activities:

· Insolvency and advisory services;

· Debt advisory services; and

· Corporate finance services.

Insolvency and advisory services

For the Group's formal insolvency appointments and other advisory engagements, where remuneration is typically determined based on hours worked by professional Partners and colleagues, the Group transfers control of its services over time and recognises revenue over time if the Group:

· Provides services for which it has no alternative use or means of deriving value; and

· Has an enforceable right to payment for its performance completed to date, and for formal insolvency appointments has approval from creditors to draw fees which will be paid from asset realisations.

Progress on each assignment is measured using an input method based on costs incurred to date as a percentage of total anticipated costs.

In determining the amount of revenue and the related balance sheet items (such as trade receivables, unbilled income and deferred income) to recognise in the period, management is required to form a judgement on each individual contract of the total expected fees and total anticipated costs. These estimates and judgements may change over time as the engagement completes and this will be recognised in the consolidated statement of comprehensive income in the period in which the revision becomes known. These judgements are formed over a large portfolio of contracts and are therefore unlikely to be individually material.

Invoices on formal insolvency appointments are generally raised having achieved approval from creditors to draw fees. This is typically settled on a timely basis from case funds. On advisory engagements, invoices are generally raised in line with contract terms.

Where revenue is recognised in advance of the invoice being raised (in line with the recognition criteria above) this is disclosed as unbilled revenue within trade and other receivables.

Unbilled revenue

Unbilled revenue recognised by the Group falls into one of three categories: insolvency & advisory services, corporate ﬁnance services and debt advisory services.

When the Group is engaged to work on large and complex administration assignments it can take longer to negotiate final fees with creditors and therefore our appointment on these more complex cases can increase our unbilled revenue and extend the cash conversion cycle. Within our sector work in progress days (unbilled revenue) can typically range from five to seven months.

Debt advisory services

Revenue will typically be recognised at a point in time following satisfaction of the performance obligation(s) in the contract, at which point the Group is typically entitled to invoice the customer, and payment will be due.

Corporate Finance services

Fees typically comprise a non-refundable retainer and a success fee based on a ﬁxed percentage of the transaction value. Non-refundable retainer fees are recognised over the course of the contract during which the ongoing provision of services, which vary by assignment, is delivered. The scope and value of the retainer is agreed upon commencement and reviewed regularly over the delivery period. Retainer fees are invoiced to the client and are payable in the ﬁrst three to four months. Success fees are deferred and recognised on completion when unconditional contracts have been exchanged.

2.12 Goodwill

Goodwill is initially measured at cost (being the excess of the aggregate of the consideration transferred and the amount recognised for non-controlling interests and any previous interest held over the net identiﬁable assets acquired and liabilities assumed). If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the Group re-assesses whether it has correctly identiﬁed all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be recognised at the acquisition date.

If the reassessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognised in the income statement.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. The goodwill is tested annually for impairment irrespective of whether there is an indication of impairment. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Group's cash-generating units that are expected to beneﬁt from the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units.

2.13 Intangible assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date at the fair value.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives, being 25% on a straight-line basis for computer software, and 8% on a straight-line basis for client lists.

2.14 Property, plant and equipment

Property, plant and equipment are stated at cost net of accumulated depreciation and accumulated impairment losses.

Cost comprises purchase cost together with any incidental costs of acquisition.

Depreciation is provided to write down the cost less the estimated residual value of all tangible ﬁxed assets by equal instalments over their estimated useful economic lives on a straight-line basis. The following rates are applied:

Computer equipment	25%
Fixtures and fittings	15%
Leasehold improvements	Over the term of the lease
Right of use assets	Over the term of the lease
Motor vehicles	25%

2.15 Financial instruments

The Group classiﬁes ﬁnancial instruments, or their component parts, on initial recognition as a ﬁnancial asset, a ﬁnancial liability or an equity instrument in accordance with the substance of the contractual arrangement. Financial instruments are recognised on trade date when the Group becomes a party to the contractual provisions of the instrument. Financial instruments are recognised initially at fair value plus, in the case of a ﬁnancial instrument not at fair value through proﬁt and loss, transaction costs that are directly attributable to the acquisition or issue of the ﬁnancial instrument. Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when the financial asset and substantially all the risks and rewards are transferred. A financial liability is derecognised when it is extinguished, discharged, cancelled or expires.

2.16 Non-derivative ﬁnancial instruments

Non-derivative ﬁnancial instruments comprise trade and other receivables, cash and cash equivalents, loans and borrowings and trade and other payables. All ﬁnancial instruments held are classiﬁed as ﬁnancial assets or liabilities held as at amortised cost.

Trade and other receivables and Trade and other payables

Trade and other receivables are recognised initially at transaction price less attributable transaction costs. Trade and other payables are recognised initially at transaction price plus attributable transaction costs. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any expected credit losses in the case of trade and other receivables. If the arrangement constitutes a ﬁnancing transaction, for example if payment is deferred beyond normal business terms, then it is measured at the present value of future payments discounted at a market rate of interest for a similar debt instrument.

Interest bearing borrowings

Interest bearing borrowings are recognised initially at their fair value. Subsequent to initial recognition, interest bearing borrowings are stated at amortised cost using the effective interest method.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and form an integral part of the Group's cash management are included as a component of cash and cash equivalents for the purpose only of the cash ﬂow statement.

2.17 Impairment of tangible and intangible assets

At each reporting end date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. The impairment indicator assessment applies to all assets including assets with indefinite useful lives, and goodwill for which an impairment assessment is performed annually regardless of whether an impairment indicator exists or not. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash ﬂows are discounted to their present value using a pre-tax discount rate that reﬂects current market assessments of the time value of money and the risks speciﬁc to the asset for which the estimates of future cash ﬂows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. Impairment losses are recognised immediately in the consolidated statement of comprehensive income.

Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. The reversal of an impairment loss is recognised immediately in proﬁt or loss. Impairment of goodwill is not reversed.

2.18 Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable proﬁt for the year. Taxable proﬁt differs from net proﬁt as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the ﬁnancial statements and the corresponding tax bases used in the computation of taxable proﬁt and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable proﬁts will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the tax proﬁt nor the accounting proﬁt.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufﬁcient taxable proﬁts will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are enacted or substantively enacted when the liability is settled, or the asset is realised. Deferred tax is charged or credited to the consolidated statement of comprehensive income except when it relates to items charged or credited to equity, in which case the deferred tax is also dealt with in equity.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.

2.19 Employee beneﬁts

The Group operates deﬁned contribution plans for its employees. A deﬁned contribution plan is a post-employment beneﬁt plan under which the Group pays ﬁxed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to deﬁned contribution pension plans are recognised as an expense in the periods during which services are rendered by employees.

Termination beneﬁts are recognised immediately as an expense when the Group is demonstrably committed to terminate the employment of an employee or to provide termination beneﬁts.

2.20 Provisions

A provision is recognised in the statement of ﬁnancial position when the Group has a present legal or constructive obligation as a result of a past event, that can be reliably measured and it is probable that an outﬂow of economic beneﬁts will be required to settle the obligation. Provisions are determined by discounting the expected future cashﬂows at a pre-tax rate that reﬂects risks speciﬁc to the liability.

In common with comparable businesses, the Group is involved in a number of disputes in the ordinary course of business which may give rise to claims. Provision is made in the ﬁnancial statements for all claims where costs are likely to be incurred and represents the cost of defending and concluding claims. The Group carries professional indemnity insurance and no separate disclosure is made of the cost of claims covered by insurance as to do so could seriously prejudice the position of the Group. There are currently no provisions held at year end for legal claims.

2.21 Leases

The Group leases a number of properties in various locations around the UK from which it operates.

All leases are accounted for by recognising a right of use asset and a lease liability except for:

· Leases of low value assets; and

· Leases with a duration of twelve months or less.

In accordance with IFRS16, lease liabilities are measured at the present value of the contractual payments due to the lessor over the lease term, with the discount rate determined by reference to the rate inherent in the lease at the commencement date.

Variable lease payments are only included in the measurement of the lease liability if they depend on an index or rate. In such cases, the initial measurement of the lease liability assumes the variable element will remain unchanged throughout the lease term. Other variable lease payments are expensed in the period to which they relate.

On initial recognition, the carrying value of the lease liability also includes:

· Amounts expected to be payable under any residual value guarantee;

· The exercise price of any purchase option granted in favour of the Group if it is reasonably certain to assess that option;

· Any penalties payable for terminating the lease, if the term of the lease has been estimated on the basis of termination option being exercised.

Right of use assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and increased for:

· Lease payments made at or before commencement of the lease;

· Initial direct costs incurred; and

· The amount of any provision recognised where the Group is contractually required to dismantle, remove or restore the leased asset (typically leasehold dilapidations).

Subsequent to initial measurement, lease liabilities increase as a result of interest charged at a constant rate on the balance outstanding and are reduced for lease payments made.

Right of use assets are depreciated on a straight-line basis over the remaining term of the lease or over the remaining economic life of the asset if, rarely, this is judged to be shorter than the lease term.

When the Group revises its estimate of the term of any lease (because, for example, it re-assesses the probability of a lessee extension or termination option being exercised), it adjusts the carrying amount of the lease liability to reﬂect the payments to make over the revised term, which are discounted at the same discount rate that applied on lease commencement. The carrying value of lease liabilities is similarly revised when the variable element of future lease payments dependent on a rate or index is revised. In both cases an equivalent adjustment is made to the carrying value of the right of use asset, with the revised carrying amount being depreciated over the remaining (revised) lease term.

2.22 Financing income and expenses

Financing expenses comprise interest payable, ﬁnance charges on leases recognised in proﬁt or loss using the effective interest method, unwinding of the discount on provisions, and net foreign exchange losses that are recognised in the statement of comprehensive income.

Other interest receivable and similar income include interest receivable on funds invested and net foreign exchange gains.

Interest income and interest payable are recognised in the statement of comprehensive income as they accrue, using the effective interest method.

2.23 Share capital

Ordinary shares are classiﬁed as equity. Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs.

2.24 Share based payments

Equity settled share-based payments to employees and others providing similar services are measured at the fair value of the equity instruments at the grant date.

The fair value determined at the grant date of the equity settled share based payments is expensed on a straight-line basis over the vesting period, based on the Group's estimate of the number of equity instruments that will eventually vest, with a corresponding increase in equity. At the end of each reporting period, the Group revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognised in the statement of comprehensive income such that the cumulative expense reﬂects the revised estimate, with a corresponding adjustment to other reserves. Where equity settled share based payments of the Parent Company have been issued to employees of its subsidiaries this is recognised as a cost of investment in the Parent Company ﬁnancial statements and as an expense and capital contribution in the subsidiary.

The Employee Beneﬁt Trust has been consolidated.

2.25 Dividends

Interim dividends are recognised in the financial statements when they are paid. Final dividends which are recommended for shareholder approval after the year end balance sheet date, are disclosed as a post year end event. Prior year dividends have been restated as details in 2.27.

2.26 Liabilities to Partners

The Group recognises liabilities to Partners, and due to the nature of the transactions discloses these amounts separately to other payables. Upon IPO in March 2020 the Group had cessation profits due to Partners and related tax due to HMRC totalling £22.0 million, these have been disclosed separately to the go forward profits due to Partners as part of the ongoing profit share agreements that Partners have with Group companies. As at 30 April 2022, of the IPO liabilities £1.3 million was outstanding and post year end in May 2022 this was repaid, so all IPO liabilities have been satisfied. Going forward the only liabilities to Partners are the go-forward profit shares.

2.27 Restatement of prior year results

In March 2022 the Group's annual report for FY2021 was reviewed by the Financial Reporting Council ("FRC"). The review was based on the annual report and accounts and did not benefit from detailed knowledge of the business or an understanding of the underlying transactions entered into and therefore provides no assurance that the annual report is correct in all material respects. It was, however, conducted by staff of the FRC who have an understanding of the relevant legal and accounting framework. Following the review by the FRC, the Group have changed their dividend recognition policy. Previously the Group recognised interim dividends at the point when the Board declared publicly, however, going forward the Group will follow paragraph 2.10 of the ICAEWs Technical Release 02/17BL and recognise interim dividends when paid. The impact of this change results in the de-recognition of a £1.8 million interim divided liability in FY2021 as it was paid in FY2022, with a corresponding increase in net assets and retained earnings of the same amount. There was no impact on the Group's profit or cash flows for the year ended 30 April 2021.

3. Critical accounting judgements and key sources of estimation uncertainty

In the application of the Group's accounting policies, Directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

The following are the critical judgements, apart from those involving estimates (which are dealt with separately below), that have been made in the process of applying the Group's accounting policies and that have had the most signiﬁcant effect on amounts recognised in the ﬁnancial statements, as listed below:

Deemed remuneration

Deemed remuneration arises during acquisitions, where compensation in the form of equity is subject to a lock-in period, in order to retain the key fee earners post acquisition. This is a judgement area but the guidance in IFRS 3 Business Combinations is followed. As the equity compensation is restricted until the key fee earners have completed the required lock-in period, it is not considered to be part of the cost of the acquisition and it is initially recognised in the share based payments reserve as a debit to the reserve and amortised through the statement of comprehensive income over the lock-in period. Compensation for the acquisitions made in the year was in the form of equity subject to a lock-in period. The Directors have made the judgement that this equity compensation is deemed remuneration. Note 23 provides further detail on the acquisitions in the year.

Key source of estimation uncertainty

The judgements involving estimates and assumptions which have a signiﬁcant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Impairment of goodwill

The Group records all assets and liabilities acquired in business combinations, including goodwill, at fair value. Goodwill is not amortised but is subject, at a minimum, to annual tests for impairment. The initial goodwill recorded, and subsequent impairment review require management to determine appropriate assumptions (which are sources of estimation uncertainty) in relation to cash flow projections over a five year period, the terminal growth rate and the discount rate used to discount the cash flows to present value. Due to the size and nature of goodwill it is considered an area of estimation uncertainty. The balance of goodwill is £10.2 million (2021: £9.6 million). See Note 12 for further details on the Group's assumptions.

Unbilled revenue

Time recorded for chargeable professional services work is regularly reviewed to ensure that only what the Directors believe to be recoverable from the client is recognised as unbilled revenue within prepayments and accrued revenue.

Estimates are made with allocating revenue to the performance obligation and the valuation of contract assets. The Group estimates the contract completion point, costs yet to be incurred and the potential outcome of the contract.

Signiﬁcant assumptions are involved on a case-by-case basis in order to estimate the time to complete an assignment and the resultant final compensation, where variable consideration is involved, and which results in the recognition of unbilled revenue.

Management base their assumptions on historical experience, market insights and rational estimates of future events. Estimates are made in each part of the business by engagement teams with experience of the service being delivered and are subject to review and challenge by management. The balance of unbilled revenue at year end was £35.3 million (2021: £35.1 million). Refer to Note 14 for further detail on unbilled revenue.

Share based payments

The charge related to equity settled transactions with employees is measured by reference to the fair value of the equity instruments at the date they are granted, using an appropriate valuation model selected according to the terms and conditions of the grant. Judgement is applied in determining the most appropriate valuation model and in determining the inputs to the model. Third-party experts are engaged to advise in this area where necessary. There is estimation uncertainty in the determination of assumptions related to the number of options which are expected to vest, by reference to historic leaver rates and expected outcomes under relevant performance conditions. The share based payment expense for the year was £8.0 million (2021: £4.6 million). Refer to Note 22 for further detail on share based payments.

4. Financial risk management

The Group is exposed to a variety of ﬁnancial risks through its use of ﬁnancial instruments which result from its operating activities. All of the Group's ﬁnancial instruments are classiﬁed as ﬁnancial assets or liabilities measured at amortised cost.

The Group does not actively engage in the trading of ﬁnancial assets for speculative purposes. The most signiﬁcant ﬁnancial risks to which the Group is exposed are described below.

Credit risk

Credit risk associated with cash balances is managed by transacting with major global financial institutions and periodically reviewing their creditworthiness. The Group mainly banks with Barclays Bank plc and Natwest whose credit ratings are A-1 short term, (Standard & Poor's) and A-2 short term, (Standard & Poor's) respectively. Accordingly, the Group's associated credit risk is limited.

Generally, the Group's maximum exposure to credit risk is limited to the carrying amount of the ﬁnancial assets recognised at the balance sheet date, as summarised below.

Credit risk is the risk of ﬁnancial risk to the Group if a counter party to a ﬁnancial instrument fails to meet its contractual obligation. The nature of the Group's debtor balances, the time taken for payment by clients and the associated credit risk are dependent on the type of engagement.

	As at	As at
	30 April 2022	30 April 2021
Credit Risk	£'000	£'000

Trade receivables	7,178	4,855
Cash and cash equivalents	24,924	24,383
	32,102	29,238

On formal insolvency appointments (which form the majority of the Group's activities), invoices are generally raised having achieved approval from creditors to draw fees. This is typically settled on a timely basis from case funds. The credit risk on these engagements is therefore considered to be extremely low.

The Group's trade receivables are actively monitored by management on a monthly basis. The Group provides a variety of different professional services in line with its pillars to spread credit risk over its service lines. The Group also controls cash collection of its insolvency assignments in line with the terms of appointment.

The ageing proﬁle of trade receivables that were not impaired is shown within Note 14. The Group does not believe it is exposed to any material concentrations of credit risk.

The Group reviews unbilled revenue on a case-by-case basis. On a monthly basis, following the receipt of information implying irrecoverability the appropriate provisions are booked. The unbilled revenue disclosed within the accounts is net of provisioning, therefore the Group does not consider the unbilled revenue disclosed on the balance sheet to be of material credit risk. Unbilled revenue represented £35.3 million (2021: £35.1 million).

Liquidity risk

Liquidity risk is the risk that the Group will encounter difﬁculty in meeting its obligations associated with its ﬁnancial liabilities. The Group seeks to manage ﬁnancial risks to ensure sufﬁcient liquidity is available to meet foreseeable needs and to invest cash assets safely and proﬁtably.

The contractual undiscounted maturities of borrowings, trade payables and other ﬁnancial liabilities are disclosed below.

	As at	As at
	30 April 2022	30 April 2021
Liquidity risk	£'000	£'000

Within 1 year	26,301	31,424
Within 2-5 years	11,986	13,994
Beyond 5 years	3,996	935
	42,283	46,353

The discounted carrying value of these liabilities is £41.2 million (2021: £44.2 million), comprising £6.3 million lease liabilities (2021: £3.6 million), £6.8 million loans (2021: £8.0 million), and £28.1 million trade and other payables (2021: £32.6 million).

Interest rate risk

Interest rate risk is the risk that the value of a ﬁnancial instrument or cash ﬂows associated with the instrument will ﬂuctuate due to changes in market interest rates. Interest bearing assets including cash and cash equivalents are considered to be short term liquid assets. It is the Group's policy to settle trade payables within the credit terms allowed and the Group does therefore not incur interest on overdue balances.

The Group has a £8 million term loan (£6.8 million outstanding as at April 2022) with an interest base rate plus 3% repayable over a 4 year period. The company has an interest risk management risk strategy and reforecasts cashflow whenever the base rate changes, base interest rates are currently low and in the medium term it is expected that this will remain stable.

In terms of sensitivity analysis, if interest rates increased by 200 basis points or 2% the incremental FY2022 impact would reduce the Profit Before Tax by £0.2m. If base rate (prevailing at the date of signing of 1.25%) reduced there would be a negligible impact on the Group's FY2022 Profit before tax.

Foreign currency risk

There is no material risk associated with foreign currency transactions or overseas subsidiaries.

Capital management

The Group monitors the capital requirements within the Group and maintains a capital management policy that enable the Group to meet requirements it may face. Shortly after year end the Group repaid all IPO liabilities due to Partners, with a final payment of £1.3 million in May 2022. Net cash of £18.1 million (2021: £16.4 million), an undrawn £10 million RCF, the recent placing raising £7.5 million and the ability to issue further equity, gives the Group sufficient options to act as acquisition opportunities arise, subject to our selective criteria of cultural fit, strategic fit and mutually acceptable transaction economics.

5. Operating segments

The Group has one single business segment and therefore all revenue is derived from the provision of specialist business advisory services as stated in the principal activity. The Chief operating Decision Maker (CoDM) is the Chief Executive Officer. The Group has five pillars which individually do not meet the definition of a disclosable operating segment.

The Group's assets are held in the UK and all its capital expenditure arises in the UK. The Group's operations and markets are located in the UK.

All revenue is recognised in relation to contracts held with customers. No customer contributed 10% or more of the Group's revenue.

6. Operating proﬁt

Operating proﬁt has been arrived at after charging:

		Year Ended	Year Ended
		30 April 2022	30 April 2021
		£'000	£'000
Depreciation of owned assets		794	677
Depreciation of right of use assets		1,270	835
Amortisation of intangible assets		67	39
Fees payable to the Group's auditor for the audit of the Group accounts		90	80
Fees payable to the auditor for other services
	the auditing of Subsidiary accounts	25	20
Expenses relating to short term leases		329	52

7. Director and employee information

The average number of Directors and employees during the year was:

	Year Ended	Year Ended
	30 April 2022	30 April 2021
	Number	Number
Directors	7	7
Fee earning employees (including Partners)	397	314
Non fee earning employees	107	77



The aggregate payroll costs of these persons were as follows:

	£'000	£'000
Wages, salaries and Partner compensation charged as an expense	46,402	38,426
Social security costs	3,673	2,892
Pension costs - defined contribution scheme	725	611
Share-based payment expense	7,996	4,643
	58,796	46,572

Two directors are currently included in the Company pension scheme.

8. Directors' remuneration and emoluments (including Partner profit allocations)

Details of emoluments paid to the key management personnel (including Partner proﬁt allocations in respect of Messrs Rowley and French) are as follows:

	Year Ended	Year Ended
	30 April 2022	30 April 2021
	£'000	£'000
Directors' emoluments	2,729	2,571
Benefits in kind (inc. pension contributions)	27	19
Share option award	-	180
	2,756	2,769

Remuneration (including Partner profit allocation) disclosed above include the following amounts paid to the highest paid Director:

	£'000	£'000
Remuneration for qualifying services	1,304	1,353

9. Finance expense

	Year Ended	Year Ended
	30 April 2022	30 April 2021
	£'000	£'000
On bank loans and overdrafts measured at amortised cost	305	93
On lease liability	190	140
Total finance expense	495	233

10. Taxation

	Year Ended	Year Ended
	30 April 2022	30 April 2021
	£'000	£'000
Current tax
UK Corporation tax	4,699	4,194

Deferred tax
Reversal of temporary differences	(1,494)	(1,201)

Total tax charge	3,205	2,993


Reconciliation of tax charge:

	Year Ended	Year Ended
	30 April 2022	30 April 2021
	£'000	£'000
Profit before tax	15,116	16,604

Corporation tax in the UK at 19%	2,872	3,155

Effects of:
Non-deductible expenses	866	26
Other permanent differences	(533)	(188)

Total tax charge	3,205	2,993

The UK Budget 2021 announcements on 3 March 2021 included an increase to the UK's main corporation tax rate to 25%, which is due to be effective from 1 April 2023. The relevant corporation tax rate has been applied in the calculation of deferred tax balances.

11. Earnings per share

The earnings per share ("EPS") has been calculated using the proﬁt for the year and the weighted average number of ordinary shares outstanding during the year, as follows:

£m	EPS	Adjusted EPS	EPS	Adjusted EPS
	2022	2022	2021 (restated)	2021 (restated)
Reported Profit after tax	11.9	11.9	13.6	13.6
Add Share based payments	-	8.0	-	4.6
Less deferred tax	-	(1.5)	-	(1.2)
Adjusted Profit after tax	11.9	18.4	13.6	17.0

Total shares in issue	243,191,489	243,191,489	239,393,684	239,393,684
Total share EPS (pence)	4.90	7.57	5.69	7.11

Weighted average shares in issue excluding EBT	222,669,711	222,669,711	224,441,489	224,441,489
Basic EPS (pence)	5.35	8.27	6.06	7.58

Dilutive potential ordinary shares under share option schemes	13,424,101	13,424,101	9,976,097	9,976,097

Weighted diluted shares in issue	236,093,812	236,093,812	234,417,586	234,417,586

Diluted EPS (pence)	5.04	7.80	5.81	7.26

The Employee Beneﬁt Trust has waived its entitlement to dividends and is not included within weighted average shares in issue. It holds 22,531,865 shares of the 243,191,489 shares in issue at 30 April 2022 (2021: 18,750,000). When options are exercised by employees, dividend rights accrue.

On 4 May 2022 393,700 new ordinary shares were issued as part of the acquisition of BridgeShield Asset Management Limited. These are not considered dilutive for the above calculations.

12. Goodwill and other intangible assets

	Computer
	software	Client List	Goodwill	Total
	£'000	£'000	£'000	£'000

Cost
At 1 May 2020	10	-	750	760
Additions	-	833	8,850	9,683
At 30 April 2021	10	833	9,600	10,443

At 1 May 2021	10	833	9,600	10,443
Additions	-	-	600	600
Disposals	(10)	-	-	(10)
At 30 April 2022	-	833	10,200	11,033


Amortisation
At 1 May 2020	(10)	-	-	(10)
Charge for the period	-	(39)	-	(39)
At 30 April 2021	(10)	(39)	-	(49)

At 1 May 2021	(10)	(39)	-	(49)
Charge for the period	-	(67)	-	(67)
Disposals	10	-	-	10
At 30 April 2022	-	(106)	-	(106)


Net book value
At 30 April 2021	-	794	9,600	10,394
At 30 April 2022	-	727	10,200	10,927

Additions to goodwill in the year relate to acquisitions as set out in Note 23.

Following initial recognition, goodwill is subject to impairment reviews, at least annually, and measured at cost less accumulated impairment losses. Any impairment is recognised immediately in the consolidated statement of comprehensive income and is not subsequently reversed.

There are three steps to performing an impairment review:

· Allocating the goodwill to the relevant cash-generating unit (CGU) or multiple CGUs.

· Determining the recoverable amount of the CGU to which the goodwill belongs.

· Recognising any impairment losses after performing an impairment review of the CGU or CGUs.

Goodwill acquired in a business combination represents future economic beneﬁts arising from assets that are not capable of being individually identiﬁed and separately recognised. Goodwill does not generate cash ﬂows independently from other assets or groups of assets and so the recoverable amount of goodwill as an individual asset cannot be determined. However, goodwill often contributes to the cash ﬂows of individual or multiple CGUs. Therefore, goodwill acquired in a business combination must be allocated from the acquisition date to each of the acquirer's CGUs or groups of CGUs that are expected to beneﬁt from the synergies of the business combination.

The deﬁnition of a CGU is "the smallest identiﬁable group of assets that generates cash inﬂows that are largely independent of the cash inﬂows from other assets or groups of assets" (per IAS 36).

For the Group a CGU is represented by:

· A net cash inflow stream from a group of acquired Partners

· A net cash inflow from an entire location

· An entire entity (parent or subsidiary entities within a group)

· Departments or business units within an entity

In accordance with IAS 36, a CGU to which goodwill has been allocated shall be tested for impairment annually and whenever there is indication of impairment by comparing the carrying amount of the unit, including the goodwill, with the recoverable amount of the unit.

If the recoverable amount of the unit exceeds the carrying amount of the unit, the unit and the goodwill allocated to that unit shall be regarded as not impaired. If the carrying amount of the unit exceeds the recoverable amount of the unit, the entity shall recognise an impairment loss.

Goodwill

At 30 April 2022:

· Debt Advisory £750k

· JDC Group £3,210k

· Spectrum £5,640k

· BridgeShield £600k

The recoverable amount is the higher of a CGU's fair value less costs to sell and its value in use. In brief the fair value less costs to sell is likely to involve a valuation of the CGU if sold at an arm's length and deducting the costs of disposal.

The value in use will involve a discounted cash ﬂow ('DCF') calculation estimating the future cash inﬂows and outﬂows to be derived from the continuing use of the CGU, The DCF calculation would include the estimated net cash ﬂows, if any, to be received for the disposal of the CGU at the end of its useful life.

Key assumptions used in value in use calculation

The key assumptions for the value in use calculation are those regarding:

· Number of years of cash flows used and budgeted EBITDA growth rate;

· Discount rate; and

· Terminal growth rate.

Number of years of cash ﬂows used

The recoverable amount of the CGU is based on a value in use calculation using speciﬁc cash ﬂow projections over a 5-year period and a terminal growth rate thereafter. The cashﬂow projections for the 5-year period assume a growth rate for each CGU between 0% to 7.5% (2021: 7.5%) based on prior performance and future expectation.

The 5-year forecast is prepared considering members' expectations based on market knowledge, numbers of new engagements and the pipeline of opportunities.

Discount rate

The Group's post-tax weighted average cost of capital has been used to calculate a Group pre-tax discount rate of 12.9% (2021: 12.9%), which reﬂects current market assessments of the time value of money for the period under review and the risks speciﬁc to the Group.

Terminal growth rate

A terminal growth rate of 1.0% (2021: 1.0%) is used. This is derived from members' expectations based on market knowledge, numbers of new engagements, and the pipeline of opportunities.

Sensitivity to changes in assumptions

With regard to the assessment of value in use for Debt Advisory, JDC, Spectrum, and BridgeShield CGU, the Directors believe that reasonably possible changes in any of the above key assumptions would not cause the carrying value of the unit to exceed its recoverable amount.

13. Property, plant and equipment

	30 April 2022
		Property, Plant and Equipment
	Leasehold properties (right of use asset)	Computer	Fixtures and	Leasehold	Motor
	Leasehold properties (right of use asset)	equipment	fittings	improvements	vehicles	Total
	£'000	£'000	£'000	£'000	£'000	£'000

Cost
At 1 May 2020	7,233	1,715	622	1,681	7	11,258
Arising on acquisitions	-	74	5	145	-	224
Additions	413	401	181	120	-	1,114
Disposal	(46)	-	-	-	-	(46)
At 30 April 2021	7,600	2,190	808	1,946	7	12,550

At 1 May 2021	7,600	2,190	808	1,946	7	12,550
Arising on acquisitions	-	6	-	-	-	6
Additions	4,022	461	251	686	-	5,421
Disposal	-	(991)	(142)	(557)	-	(1,690)
At 30 April 2022	11,622	1,666	917	2,075	7	16,287


Depreciation
At 1 May 2020	(3,238)	(1,042)	(281)	(705)	(3)	(5,269)
Depreciation charge for the period	(835)	(339)	(110)	(227)	(1)	(1,512)
Disposals	-	-	-	-	-	-
At 30 April 2021	(4,073)	(1,381)	(391)	(932)	(4)	(6,781)

At 1 May 2021	(4,073)	(1,381)	(391)	(932)	(4)	(6,781)
Depreciation charge for the period	(1,270)	(397)	(114)	(280)	(3)	(2,064)
Disposals	-	991	142	551	-	1,684
At 30 April 2022	(5,342)	(787)	(362)	(661)	(7)	(7,161)


Net book value
At 30 April 2021	3,527	808	417	1,013	3	5,769
At 30 April 2022	6,279	879	554	1,414	-	9,126

14. Trade and other receivables

	Group as at	Group as at
	30 April 2022	30 April 2021
Trade and other receivables	£'000	£'000
Trade receivables	7,178	4,855
Other receivables	3,625	2,466
Unbilled revenue	35,261	35,052
	46,063	42,373


The ageing profile of non-related party trade receivables is as follows:

	As at	As at
	30 April 2022	30 April 2021
Due in	£'000	£'000
<30 Days	3,353	2,286
30-60 Days	1,700	1,182
60-90 Days	784	309
90-180 Days	847	586
>180 Days	494	492
Total	7,178	4,855

All of the trade receivables were non-interest bearing and receivable under normal commercial terms. The Directors consider that the carrying value of trade and other receivables approximates to their fair value.

The acquisition completed during the year fell within FRP's five service pillars, and therefore the treatment of providing or writing off acquired receivables follows the Group policy.

All trade receivables and unbilled revenue are derived from contracts with customers. Unbilled revenue constitutes income recognised based on stage of completion but not yet billed to the customer. Write offs happen on a case-by-case basis immediately following the receipt of information implying irrecoverability.

The gross receivables have increased in line with the growth of the business.

The expected loss provision for trade receivables is calculated on the gross carrying amount of trade receivables less any specific loss allowance, and is detailed below as follows:

As at 30 April 2021	<30 days £'000	30-60 days £'000	60-90 days £'000	90-180 days £'000	>180 days £'000	Total £'000
Expected loss rate	0%	0%	5%	2%	59%	13%
Gross carrying amount	2,286	1,182	324	601	1,210	5,603
Expected credit loss provision	-	-	(15)	(15)	(718)	(748)
	2,286	1,182	309	586	492	4,855

As at 30 April 2022
Expected loss rate	0%	2%	3%	7%	62%	12%
Gross carrying amount	3,367	1,735	810	913	1,289	8,114
Expected credit loss provision	(14)	(35)	(27)	(66)	(795)	(936)
	3,353	1,700	784	847	494	7,178

15. Cash and cash equivalents

	Group as at	Group as at
	30 April 2022	30 April 2021
	£'000	£'000
Cash at bank and in hand	24,924	24,383

16. Trade and other payables

	Group as at	Group as at
	30 April 2022	30 April 2021
		(restated)
Current liabilities	£'000	£'000
Trade payables	1,556	877
Other taxes and social security costs	7,428	5,849
Liabilities to Partners go forward	9,129	9,074
Liabilities to Partners cessation profits at IPO	1,302	5,440
Deferred consideration	-	813
Other payables and accruals	10,743	10,835
	30,159	32,888


	Group as at	Group as at
	30 April 2022	30 April 2021
Non-current liabilities	£'000	£'000
Other payables and accruals	1,443	-
Liabilities to Partners go forward	-	245
Liabilities to Partners cessation profits at IPO	-	1,114
Partner capital	4,273	3,833
Deferred consideration	-	339
	5,716	5,531

The liabilities to Partners mentioned in both of the above tables includes tax due to HMRC on their behalf.

Other payables and accruals includes £7.1 million of staff costs (2021: £4.5 million).

17. Loans and borrowings

	Group as at	Group as at
	30 April 2022	30 April 2021
	£'000	£'000

Current borrowings
Bank loan	2,000	1,600
Lease liability	1,365	872
	3,365	2,472

Non-current borrowings
Bank loan	4,800	6,400
Lease liability	4,913	2,768
	9,713	9,168

Bank loan is repayable
Within one year	2,000	1,600
Within two to five years	4,800	6,400
	6,800	8,000

The above £6.8 million (2021: £8 million) five-year term loan is with Barclays Bank plc (Barclays) and is repayable over 20 quarterly instalments. Interest rate is the Bank of England base rate, plus 3%. The Group also has a £10 million revolving credit facility with Barclays that was undrawn at 30 April 2022, running until 30 November 2023. Barclays have security over FRP entities for both the RCF and the term loan, in the form of both a fixed and floating charge over the Group's assets.

18. Deferred tax

	Group as at	Group as at
	30 April 2022	30 April 2021
	£'000	£'000
Deferred tax (asset)/liability brought forward	(925)	124
Recognised in profit and loss for the period	(1,494)	(1,200)
Deferred tax on acquisition	(13)	151
Deferred tax (asset)	(2,431)	(925)


The deferred tax provision is analysed as follows:

	Group as at	Group as at
	30 April 2022	30 April 2021
	£'000	£'000
Accelerated capital allowance	65	138
Other temporary differences	-	(14)
Share based payments	(2,635)	(1,200)
Deferred tax on acquisition	138	151
	(2,431)	(925)

19. Financial instruments

	Group as at	Group as at
	30 April 2022	30 April 2021
	£'000	£'000
Financial assets held at amortised cost	32,102	29,238
Financial liabilities held at amortised cost	42,283	36,556

20. Share capital

	Group as at	Group as at
	30 April 2022	30 April 2021
Allotted, called up and fully paid	£	£
243,191,489 Ordinary shares of £0.001 each	243,191	243,191

On 4 May 2022 393,700 new ordinary shares were issued as part of the acquisition of BridgeShield Asset Management Limited.

In June 2022, the company executed, a secondary placing and given the over subscription also raised an additional £7.5 million through the issue of 5,357,143 new shares.

21. Dividends

For FY2022 a dividend of £1,796k, equivalent to 0.8p per eligible ordinary share, was declared on 12 February 2021 and paid on 11 June 2021. A dividend of £1,796k, equivalent to 0.8p per eligible ordinary share, was declared on 28 September 2021 and paid on 24 December 2021. A dividend of £1,796k, equivalent to 0.8p per eligible ordinary share, was declared on 15 December 2021 and paid on 24 March 2022. The Board recommends a final dividend of 1.9p per eligible ordinary share for the financial year ended 30 April 2022. Subject to approval by shareholders, the final dividend will be paid on 21 October 2022 to shareholders on the Company's register at close of business on 23 September 2022. If the final dividend is approved, the total dividends paid by the Company relating to the financial year ended 30 April 2022 will be 4.3p per eligible ordinary share.

22. Share based payments

	Number of
	share options
	April 2022
Outstanding at the beginning of the year	16,163,479
Granted during the year	2,448,975
Forfeited during the year	(276,168)
Outstanding at the end of the year	18,336,286

Exercisable at the end of the year	-


The weighted average life of outstanding options was two years (2021: two years).
Details of the number of share options outstanding by type of company scheme were as follows:

	Employees	Non-executive	Total
		directors
Outstanding at the beginning of the year	16,025,979	137,500	16,163,479
Granted during the year	2,448,975	-	2,448,975
Forfeited during the year	(276,168)	-	(276,168)
Outstanding at the end of the year	18,198,786	137,500	18,336,286

Exercisable at the end of the year	-	-	-

Option arrangements that exist over FRP Advisory Group plc's shares at the end of the year are detailed below:

	April	Exercise
Date of grant	2022	Price (£)	Vesting
From 6 March 2020	18,198,786	-	from 06/03/2023
From 6 March 2020	137,500	0.001	from 06/03/2023

Weighted average fair value per option is £0.85 (2021: £0.71).

The Group uses a Black Scholes model to estimate the fair value of share options. The options were issued over shares held by the FRP Advisory Group Employee Benefit Trust. The following information is relevant in the determination of the fair value of the above options. The assumptions inherent in the use of this model, at the time of issue, are as follows:

· The options are nil cost for the employee scheme established on IPO and nominal cost for the Non-Executive scheme;

· The option life is the estimated period over which the options will be exercised. The options have no expiry date to discount, so three years has been considered a reasonable expected life as those awarded are required to remain in employment for three years;

· No variables change during the life of the option (such as the dividend yield remaining zero);

· The volatility rate has been based on the Groups share price since IPO

· A risk-free interest rate of 0.6% has been used (2021: 0.6%); and

· 100% of the options issued under the employee scheme are expected to vest. 100% of the options issued to the Non-Executive Directors are expected to vest.

The total recognised share-based payment expense during the year by the Group was £5.4 million (2021: £3.7 million).

23. Acquisitions

The Group's growth strategy is to focus on organic growth supported by selective inorganic opportunities where there is a cultural, strategic and mutually acceptable transactional economics fit. The Group made one acquisition in the year as detailed below. The acquisition strategically fits into the Group's five service pillars and we believe there to be revenue synergies of the combinations.

Date	Name	Location	Type	Percentage bought	Pillars
28 April 2022	BridgeShield Asset Management Limited	Leigh-on-Sea	Share	100%	Restructuring advisory

Acquisition costs of £0.03 million (2021: £0.4 million) relating to the acquisition have been expensed in the period but not adjusted for in adjusted underlying EBITDA.

BridgeShield Asset Management Limited

The fair values of BridgeShield Asset Management Ltd at the acquisition date on 28 April 2022, following the purchase price allocation exercise are detailed below:

	Book value	Fair value
	£'000	£'000
Net assets acquired

Property, plant and equipment	6	6
Trade Receivables	20	20
Unbilled revenue	99	99
Cash	235	235
Trade Payables	(1)	(1)
Accruals	(33)	(33)
VAT	(8)	(8)
Corporation tax	(40)	(40)
Total provisional fair value	278	278

Consideration		878

Goodwill		600

Cash flow		£'000
Cash paid as consideration on acquisition		600
Less cash acquired at acquisition		(235)
Net cash outflow		365

		Fair value
Consideration		£'000
Initial consideration - Cash		600
Consideration settled in cash post year end		278
Total Consideration		878

After year end, on 4 May 2022 equity compensation of £500k was also granted to certain vendor fee earners. As this is subject to a lock-in, this will not been included within the cost of the acquisition but in FY2023 is expected to be accounted for as deemed remuneration within the share based payment reserve in the Statement of Changes in Equity.

The key shareholders who sold BridgeShield joined the Group as Partners. Other new colleagues who TUPE'd to the Group received nil cost option awards, from the Employee Incentive Plan (EIP) funded on IPO.

Acquisition costs has been absorbed but not adjusted for in adjusted underlying EBITDA.

The acquisition contributed £nil of revenue and £nil to the Group's underlying EBITDA for the period between the date of acquisition and the balance sheet date.

The company provides property asset management advice to specialist short-term lenders across bridging, refurbishment and development finance. It supports lenders across the UK, advising on asset management, LPA receiverships and loan risk management. They will work closely with the Brentwood office providing growth opportunities within the restructuring pillar.

24. Leases

	Group as at	Group as at
	30 April 2022	30 April 2021
	£'000	£'000
Expenses relating to short term leases	329	52
Lease interest	190	140
Cash outflow for leases	1,355	911


The carrying value of right of use assets all relate to leasehold land and buildings.

Undiscounted lease liabilities cashflows in relation to right of use assets fall due as follows:

	Group as at	Group as at
	30 April 2022	30 April 2021
	£'000	£'000
Due within one year	1,570	988
Due within two to five years	1,470	2,063
Due after more than five years	3,996	935
	7,036	3,986

25. Reserves

Called-up share capital

The called-up share capital reserve represents the nominal value of equity shares issued.

Share premium account

The share premium account reserve represents the amounts above the nominal value of shares issued and called up by the Company.

Treasury shares reserve

The Treasury shares reserve represents the shares of FRP Advisory Group plc that are held in Treasury or by the Employee Beneﬁt Trust.

Share based payment reserve

The share-based payment reserve represents:

· The cumulative expense of equity-settled share-based payments provided to employees, including key management personnel, as part of their remuneration.

· Deemed remuneration arising from acquisitions, which is amortised over the lock-in period.

Merger reserve

The merger reserve represents the difference between the nominal value of shares issued and the fair value of the assets received. The merger reserve arose following: a share for share exchange between FRP Advisory LLP and FRP Advisory Group plc as part of the group reorganisation in March 2020 and a FRP Advisory Group plc share for share exchange in the JDC Group acquisition.

Retained earnings

The retained earnings reserve represents the Group's cumulative net gains and losses less distributions. Transfers from the share based payment reserve to retained earnings are subject to Board approval.

26. Related party transactions

FRP Advisory Services LLP provides services to FRP Advisory Trading Ltd, a subsidiary of FRP Advisory Group Plc.

Relating to the financial year FRP Advisory Trading Ltd contracted services valued at £19.9 million (2021: 17.1 million) from FRP Advisory Services LLP. Geoff Rowley and Jeremy French are Directors of FRP Advisory Group plc, FRP Advisory Trading Ltd and designated members of FRP Advisory Services LLP.

27. Control

There is no one ultimate controlling party of FRP Advisory Group plc. It is listed on London Stock Exchange AIM market but the IPO vendor Partners are treated as a concert party with a holding of c. 49%.

28. Events after the reporting period

The Board of Directors proposed a final dividend of 1.9p per eligible ordinary share for the final quarter to 30 April 2022 (2021: 1.6p). Subject to approval by shareholders, the final dividend will be paid on 21 October 2022 to shareholders on the Company's register at close of business on 23 September 2022.

On 4 May 2022 393,700 new ordinary shares were issued as part of the acquisition of BridgeShield Asset Management Limited.

In June 2022, the company executed, a secondary placing and given the over subscription also raised an additional £7.5 million through the issue of new shares. Partner shareholders were invited to sell 20% of their holding and sign an extended lock-in to June 2024. This has enabled us to introduce new institutional shareholders onto the share register and further bolster our strong balance sheet as we continue to target attractive acquisitions. Alongside placing the majority of FRP Partners entered into extension of their lock-in arrangements until June 2024. Currently 48.6% of the Group's shareholder base is now subject to lock-in arrangements, including the Group Employee Benefit Trust (10.8%).

On 21 June 2022 4,412,176 ordinary shares were transferred to the Employee Benefit Trust for nil consideration, from a former Partner of the Group.

Post year end, the final £1.3 million payment of the IPO liability relating to the Cessation profits owed to Partners was paid down.

29. Capital commitments

At the balance sheet date, the Group had no material capital commitments in respect of property, plant and equipment (2021: £nil).

30. Contingent liabilities

The Group is from time to time involved in legal actions that are incidental to its operations. Currently the Group is not involved in any legal actions that would signiﬁcantly affect the ﬁnancial position or proﬁtability of the Group.

NOTE

The financial information set out above does not constitute the Group's statutory accounts for the year ended 30 April 2022 but is derived from those accounts. Statutory accounts for 2022 will be delivered to the Registrar of Companies following the company's annual general meeting. The auditors have reported on these accounts; their report was unqualified, did not draw attention to any matters by way of emphasis without qualifying their report and did not contain statements under s498(2) or (3) of the Companies Act 2006.

The information included in this announcement is taken from the audited financial statements which are expected to be dispatched to the members shortly and will be available at www.frpadvisory.com

This announcement is based on the Group's financial statements, which are prepared in accordance with UK adopted International Accounting Standards ('IFRS') in conformity with the requirements of the Companies Act 2006.

Neither an audit nor a review provides assurance on the maintenance and integrity of the website, including controls used to achieve this, and in particular whether any changes may have occurred to the financial information since first published. These matters are the responsibility of the directors but no control procedures can provide absolute assurance in this area.

Legislation in the United Kingdom governing the preparation and dissemination of financial information differs from legislation in other jurisdictions.

This preliminary statement was approved by the Board of Directors on 22 July 2022.

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