ClearDebt to quit AIM as half year profits slump
CLEARDEBT, the south Manchester debt adviser, plans to delist its shares from AIM on cost and liquidity grounds.
The news came as the Timperley-based firm announced disappointing half year figures, where despite high levels of personal debt, expected growth, particularly in IVAs, failed to materialise,
Revenues showed marginal growth of 2% to £4.6m, but ebitda fell by nearly a third (32%) to to £974,119 from £1.4m, profits slumped 73% to £123,232.
Chief executive David Mond said: “”This was a disappointing and difficult half-year borne out by a continuation of the general trend of falling personal insolvency numbers in the UK over recent quarters.
“We have felt the effect of this with poor volumes of new IVAs passed in the period although we have increased the numbers of clients under debt management. We are however expecting increased fee income derived from mis-sold payment protection insurance claims as claims for our clients in an IVA are submitted and proceeds are received into the IVAs.”
On a more positive note he said ClearCash, the group’s pre-paid MasterCard, esd winning new clients due to an enhanced functionality and individual sort code and account number.
Setting out the rationale for cancelling the AIM listing, ClearDebt said that because just 17 shareholders hold more than 61% of the shares, there is a liquidity issue.
The group also said it would be “unlikely” that it could raise money through a new share issue and there is a general lack of “investor appreciation” of its business activities.
Furthermore the annual costs of maintaining the listing of the ordinary shares on AIM are at least £93,455, which the directors consider to be “disproportionately high” and this money could be better used in running the business.
Finally the regulatory environment – a new debt management protocol was put in place last month, which is not seen as helpful to the group.
