2016 Review

A year ago we renamed our business Stockdale to mark the new approach that we were taking to stockbroking. We have organised ourselves around our central belief that by doing a great job for companies we will also be doing a great job for their owners, our institutional clients. We have supported this approach through our culture, our ownership structure and our remuneration system. We have cut our fixed costs and made other costs variable to cope with the inherent revenue volatility in our industry; and we have stopped doing things that we were not being paid for. Throughout this repositioning we have kept front of mind that institutional trust is the bedrock on which we build our ability to service our corporate clients. We remain a full service broker, continuing to make markets, to trade, to sell, to analyse and to advise, with six Qualified Executives and a Full Sponsor Licence. The only difference is that all these activities are now undertaken with the purpose of supporting our corporate clients and, in turn, our institutional clients. So, one year on, how have we done? • Being profitable and paying bonuses in three of the four quarters of our year ending 30 September 2016, and being profitable for the year as a whole. Our bonus system is “profit points” based, with every member of staff benefiting, but is also based on firm wide profitability, reflecting our belief that only by working together as a unit can we deliver a valuable service • Thirteen client gains over 2016, and a net gain of seven. Only one of the six ex-clients was lost to a competitor • Five director level appointments and a net increase in staff numbers of over 10% - creating an attractive platform for successful practitioners in our industry was a key objective of the repositioning • Calendar Q4 2016 has been our most successful period for many years. Highlights of the quarter included two IPOs and a secondary placing, all of which have traded well above their issue prices - Ascent Resources: £4.6m placing to fund the business to first gas sales, expected H1 2017. Two new high quality institutions added to register. Currently trading 55% above the placing price - Warpaint London: £23m raised at IPO for this rapidly growing, branded cosmetics business. Issue upsized in the face of strong demand and IPO valuation of £62.5m was in the middle of the target range. Key investors included Blackrock, Schroders, Hargreave Hale and JP Morgan. Shares currently trading 44% above issue price - ECSC: £5.9m raised at IPO of this long established cyber-security company to fund growth in the increasingly topical hacker-protection space. Cornerstone investors included Unicorn, Artemis, Hargreave Hale and Rathbone. Market capitalisation of £15m at IPO, currently trading 26% ahead. Our pipeline of business for 2017 is strong and, market conditions permitting, we expect to continue to grow our client base, staff numbers, revenues and profits in the current year.