Tenon results update

Aim listed Tenon group released their annual results today which show that
although their operating profits are up 8% their overall revenues are down

The firm saw business taxation and advisory, accounts and audit, corporate
finance and related advice as well as specialist taxation revenues lines drop
compared against last year.

The company saw decline in corporate finance and related advice from £11.2m
in the previous year to £6.1m currently; business taxation and advisory from
£37.4m in 2008 to £34.7m this year; specialist taxation drop from £36.6m last
year to £21.5m in 2009; and accounts and audit fall from £18.4m in 2008 to
£18.1m in 2009.

It wasn’t all bad news, turnaround and corporate recovery grew 41% compared
with last year, with revenues up £12.8m.

Carl Jackson head of Tenon recovery said the group heavily invested in the
recovery division over the last three years which is how they are now able to
reap the benefits.

Jackson added that the firm invested in people with high profile recent
additions including former KPMG director of personal insolvency Mark Sands, who
joined as head of the national bankruptcy team at Tenon

Jackson told Accountancy Age that Tenon was now the largest
bankruptcy specialists in the country and second largest corporate insolvency

The firm success is owed to employees being able to move from corporate
finance, to the recovery division, to minimise redundancies, with the method to
be reversed when corporate finance picks up.

Andy Raynor the chief executive said Tenon reduced its workforce by less than
5% to streamline costs this year, but that they hope they will not have to make
any further redundancies in the coming year.

“We’re always looking to make efficiencies” he said, adding “The recovery
division is looking to recruit in the future.”

The group hopes to focus more on taxation next year, with the upcoming
amendments to higher rate of tax which will mean a further 10% added to higher
rated tax payers.

“We expect a lot of activity in taxation next year. There are entrepreneurs
who don’t want to pay the extra 10% tax” Raynor said adding the firm expects
activity in the first three months of 2010 to be especially busy.

Raynor let slip the firm hopes to make a “few” acquisitions in the next 12
months and that the group has the banking capacity to borrow a further £20m
against their outstanding £21.1m.

The current share price of the group has risen from 53p to 54.5p with Tenon
setting a target over the next 12 months of obtaining 85p per share.

Further reading

Tenon ‘well-placed’, says bullish Raynor

Tenon results show sustained growth

Related reading