Shore Capital Group Limited: Interim results for the six months ended 30 June 2013

Shore Capital Group Limited: Interim results for the six months ended 30 June
                                     2013

                         Shore Capital Group Limited

               ("Shore Capital", the "Group", or the "Company")

            Interim results for the six months ended 30 June 2013

Shore Capital, the independent investment group specialising in equity capital
markets, principal finance and  alternative asset management, today  announces 
its interim results for the six months ended 30 June 2013.

Financial highlights

  *Revenue unchanged at £17.8 million (2012: £17.8 million); revenue
    excluding Spectrum is up 4.1%
  *Profit before tax up 123.2% to £3.3 million (2012: £1.5 million)
  *Earnings per share up 72.9% to 0.83p (2012: 0.48p)
  *Interim dividend per share of 0.40p (2012: nil)
  *Balance sheet remains strong with liquidity of £33.9 million, plus a
    further £20 million working capital facility that was unused at the period
    end

Operational highlights

  *Equity Capital Markets operations continued to perform well, increasing
    pre-tax profits by 8.1% to £3.07million (2012: £2.84 million)
  *Named by Thomson Reuters StarMine as Europe's third most productive broker
    for 2013
  *Corporate finance now has 65 retained clients. Secondary commission
    revenues increased by 11% compared to the same period in 2012
  *Puma Investments brand established, targeting private investors, receiving
    FCA authorisation in May 2013
  *Puma VCT 9 raised £28.1 million, the largest of its kind in the 2012/13
    tax year. Puma VCT 10 is in its initial launch phase
  *Spectrum Investments purchased balance of outstanding loan stock in DBD
    from Intel Capital; Shore Capital increased its ownership of Spectrum to
    59.3%

Commenting on the results, Howard Shore, Executive Chairman, said:

"The continued  strength  of  our business  demonstrates  that  confidence  is 
beginning to return to the economy  as more clients look to raise  development 
capital and seek to engage with innovative, service-orientated advisers.

"Based  on  the  solid  trading  across  the  Group  and  the  many   exciting 
opportunities ahead, the Board looks to the future with confidence."

                                   - Ends -

Enquiries:

Shore Capital                             +44 (0) 20 7468 7911
Howard Shore, Executive Chairman          +44 (0) 1481 728 902
Lynn Bruce, Director                      
Grant Thornton UK LLP (Nominated Adviser) +44 (0) 20 7383 5100
Philip Secrett
Melanie Frean
RBC Capital Markets (Broker)              +44 (0) 20 7653 4000
Josh Critchley
Oliver Hearsey
Bell Pottinger (Public Relations)         +44 (0) 20 7861 3232
Olly Scott
Charles Goodwin



About Shore Capital
Shore Capital is an AIM quoted independent investment group. Founded and owned
by entrepreneurs, for nearly three decades Shore Capital has been helping
entrepreneurial businesses reach their full potential, find committed long
term investors and develop into significant enterprises. The business offers
innovative corporate advice; a leading market-making business; some of the
most respected investment research available in the UK; and a diverse range of
high quality investment opportunities, including its hugely successful VCTs
and principal finance activities. It is a business founded on four simple
values - integrity, drive, competence and trust.

The Group is based in Guernsey, London, Liverpool, Edinburgh and Berlin. Shore
Capital Stockbrokers Limited, Shore Capital and Corporate Limited, Shore
Capital Limited and Puma Investment Management Limited are each authorised and
regulated by the Financial Conduct Authority. Shore Capital Stockbrokers
Limited is a member of the London Stock Exchange.

www.shorecap.gg

Chairman's Statement

Introduction

I am pleased to report that the Group has continued to make progress. Our
businesses have performed well by offering a compelling mix of strong advisory
capabilities, excellent execution and a range of products and services which
deliver exciting opportunities for investors. The confidence and optimism with
which our people have tackled the market's challenges is demonstrated in our
results and I thank them for their continued dedication. 

Revenues for the period (excluding Spectrum and DBD) improved by 4.1 per  cent 
to £17.2 million (2012: £16.6 million) delivering increased profit before  tax 
of £2.9 million (2012:  £2.2 million), up 31.8  per cent. Earnings per  share 
(excluding Spectrum and DBD) increased 17.5  per cent to 0.74p (2012:  0.63p). 
In addition, Spectrum contributed earnings per  share of 0.09p (2012: loss  of 
0.15p) as  a  result of  the  release  of historic  provisions  for  potential 
liabilities within DBD which are no longer required.

In Equity Capital Markets we achieved strong results, with profit before tax
increasing 8.1 per cent to £3.1 million (2012: £2.8 million). In Corporate
Finance we now have a total of 65 retained clients; and conducted 10
fundraisings for clients. Secondary commissions have advanced by 11 per cent,
demonstrating the strength of our broking team's expertise and position as a
trusted counterparty. Shore Capital is the third largest market maker on the
London Stock Exchange and we are ideally positioned to benefit from an
increase in market activity, particularly from the expected pick up in small
cap interest which appears to have already started improving.

The Group's Research and Sales team remains one of the most respected in the
City and its regional reach into the UK, Ireland and Nordics is valued by some
of the UK's leading listed businesses, who turn to Shore Capital for high
quality research and investor interaction.

During the period we consolidated our private investor offering under the Puma
Investments brand, receiving FCA authorisation in May 2013. Puma Investments
holds some of our most exciting investment opportunities, including the
market-leading Puma VCT funds and Puma Heritage. The business has a strong
pipeline of new opportunities in development and has an exciting future ahead
of it.

In Principal Finance, our German telecoms asset, Spectrum Investments
("Spectrum"), continues to offer an attractive solution to the growing
bandwidth challenges faced by telecommunications operators in that market. As
such, we remain confident that this asset can lead to a profitable realisation
in due course. During the period, we participated in a fundraising by Spectrum
as a result of which we increased our net economic interest in Spectrum/DBD
from just under 30 per cent to 59.26 per cent.

Financial Review

Income and expenditure
Following the increase of our economic interest in Spectrum to 59.26 per cent,
the financial information below presents the results for the Group as a whole,
with additional analysis of the Group excluding Spectrum/DBD.

Revenue for the half-year was unchanged at £17.8m (2012: £17.8m).

Administrative expenses were down 10.0 per cent at £14.5m (2012: £16.1m)
providing an operating profit of £3.3m (2012: £1.7m).

Interest income was £0.15m (2012: £0.15m), whilst finance costs were £0.17m
(2012: £0.36m), leading to a net finance cost of £0.02m (2012: £0.21m).

Profit before tax of the Group increased 123 per cent to £3.3m (2012: £1.5m).
This includes a profit before tax from Spectrum/DBD of £0.4m (2012: loss of
£0.7m). The profit for the half year includes a credit of £1.11m (£0.66m net
of minority interests) in respect of historic provisions for potential
liabilities of DBD that are no longer required. 

The Group excluding Spectrum/DBD
Revenue for the half-year increased by 4.1 per cent to £17.2m (2012: £16.6m).

Administrative expenses were up 1.2 per cent at £14.3m (2012: £14.1m)
providing an operating profit of £2.9m (2012: £2.4m).

Profit before tax increased by 31.8 per cent to £2.9m (2012: £2.2m). The net
margin before tax was 16.9 per cent (2012: 13.4 per cent).

Revenue from Equity Capital Markets ("ECM") was £12.6m (2012: £11.6m). Profit
before tax from ECM was £3.1m (2012: £2.8m), with a net margin of 24.4 per
cent (2012: 24.6 per cent). Revenue from Asset Management was £3.9m (2012:
£4.0m) with a net margin of 20.3 per cent (2012: 12.7 per cent). Balance sheet
holdings contributed a net gain of £0.3m (2012: £0.6m).

Basic Earnings per Share
The Group generated earnings per share of 0.74p (2012: 0.63p) excluding
Spectrum/DBD. Including the effects of Spectrum/DBD, the Group generated
earnings per share of 0.83p (2012:0.48p).

Comprehensive Earnings per Share
On a Comprehensive basis, the Group generated earnings of 0.93p per share
(2012: 0.48p).

Liquidity
As at the balance sheet date, available liquidity was £33.9m (2012: £28.8m),
comprising £32.5m (2012: £25.6m) of cash and £1.4m (2012: £3.2m) of gilts and
bonds. In addition, we have a £20m working capital facility which was
unutilised at the period end.

This liquidity demonstrates the Group's continuing ability to undertake a
range of transactions as opportunities arise in the near term.

Balance Sheet
Our balance sheet remains strong. Total equity at the period end was £68.0m
(2012: £65.2m).

In addition to the £32.5m of cash and £1.4m of gilts and bonds (as referred to
above), we held £5.8m in the various Puma Funds, £2.0m net in quoted equities,
£0.4m net in the Lily Partnership and a further £1.4m in other unquoted
holdings. In addition, the licence held in Spectrum Investments was valued at
£4.2m (on a gross basis, before allowing for minority interests).

The remainder of the balance sheet was £20.3m net, which included £19.8m of
net market debtors in our stockbroking subsidiary.

Net Asset Value per Share
Net asset value per share at the period end was 24.9p (2012: 24.4p).

Dividend
Last year, no interim dividend was paid in order that the entire year's
dividend (0.5p per share) was received in the 2013/14 tax year with a
consequential lower marginal rate of income tax for the higher rate taxpayer.

We are reinstating an interim dividend which for this period will be 0.4p per
share (2012: nil). In addition to this, the Board intends, barring unforeseen
circumstances, to pay a final dividend of not less that 0.4p per share which
would make a total for the year of 0.8p per share (2012 full year: 0.5p).

The interim dividend of 0.4p per share is expected to be paid on Wednesday, 9
October 2013 to shareholders on the register as at Friday, 27 September 2013.

Operating Review
The following operating review reports on our three main areas of focus,
namely Equity Capital Markets, Alternative Asset Management and Principal
Finance.

Equity Capital Markets ("ECM")

Overview
In ECM we provide research in selected UK sectors covering 200 companies;
broking for institutional and professional clients; market-making in circa
1,200 UK equities - with a strong presence on the AIM market - and corporate
finance advisory services for mid and small cap companies.

Following its robust results in the second half of 2012, the division
delivered another strong performance in the first half of 2013, achieving a
profit before tax of £3.1 million (2012: £2.8 million). Having a strong
balance sheet and being viewed as a solid and consistent counterparty by both
our clients and market participants is a significant advantage in the current
trading environment. Each of the division's operating businesses continued to
produce solid revenues and benefit from a diverse range of income streams.

It is pleasing to note that at a time when commissions are declining and the
market is consolidating, our secondary commission revenue increased by 11 per
cent during the first half of 2013.

The Group's Corporate Finance franchise continues to grow and is now retained
adviser to 65 companies. Encouragingly the business enjoys a strong pipeline
for the remainder of 2013. Where we identify opportunities for incremental
growth in the business, we continue to add senior, experienced individuals and
teams.

Research and Sales
The market for secondary commissions has remained challenging. Nonetheless,
the high regard in which the team and its brand is held is demonstrated by our
overall growth in market share.

Internal reports from our clients suggest our product is highly regarded by
them. This was demonstrated in two recent surveys: firstly the Thomson Reuters
StarMine survey in which Shore Capital was named as Europe's third most
productive broker for 2013; and secondly the 2013 Thomson Extel survey, in
which Shore Capital featured in the top 10 for UK Small & Mid-Cap brokers with
nine sectors voted in a top 10 position and five recorded in the top five by
fund managers, namely; construction, consumer goods, healthcare, insurance and
UK strategy.

We sustained our work to keep investors closely informed of corporate
developments with our on-going management presentation series including Astra
Zeneca, Diageo, ENRC, Legal & General, Marks & Spencer, Sainsbury's, Spirit
and Shire, as well as arranging investor conferences on Shale Energy and
Agri-Food.

Market making
We deal directly with the major retail brokers as a Retail Service Provider
through a broad range of electronic links, and with a diverse composition of
institutions including fund managers, hedge funds and private banks.London
Stock Exchange statistics continue to show us to be the third largest market
maker by number of stocks covered.

In contrast to some of our competitors, our market-making team has experienced
a marked increase in both trading volumes and revenues generated during the
first half of 2013, compared to previous periods.

Facilitating client business remains the team's central focus and we are
ideally positioned to benefit from increased market volumes as a result of an
economic recovery, together with recent changes allowing AIM stocks to be
included in ISA portfolios and the forthcoming removal of stamp duty on AIM
shares in April 2014.

Corporate Finance
The increased level of corporate finance and corporate broking activity during
2012 has continued into 2013. Whilst there has been a reduction in corporate
activity within the natural resources sector, we have seen a significant
increase in the activity of our corporate clients in other sectors including
real estate, financial services and support services.

The corporate team has to date raised a total of approximately £90 million for
clients in 10 separate fundraisings, including a placing to raise £20 million
for Telford Homes plc; a £25 million placing for Randall & Quilter Investment
Holdings Limited; and advising on the US$26 million reverse takeover
acquisition for Zoltav Resources Inc., which simultaneously raised US$20
million. The corporate team also advised RGI International Limited on its
US$340 million takeover, which was announced in January 2013 and, after the
end of the period, advised Serviced Office Group plc in relation to its
placing to raise £12 million of new equity to fund the acquisition of Avanta
Managed Offices Limited for £15 million and Wynnstay Group plc on its £9
million placing.

The team continues to achieve success in growing its retained client list. In
total we are now retained adviser to 65 companies.

Alternative Asset Management

Overview
The asset management division continues to explore innovative new products to
build on its established institutional and retail fund platforms. Total funds
under management as at 30 June 2013 were £0.91 billion, compared to £0.87
billion at 31 December 2012.

Institutional Asset Management

St Peter Port Capital ("SPPC")
St Peter Port Capital is a pre-IPO fund which also provides bridging finance
ahead of trade sales and is an opportunistic investor in development capital
situations. At its year end of 31 March 2013 it had investments in 39
companies and a NAV per share of 111.8p, an increase of 5.5 per cent on the
year and 8.2 per cent since 30 September 2012.

During the period, SPPC made a further realisation of its holding in Iona
Energy, a Canadian listed oil and gas company operating in the North Sea,
generating CAD$1.89 million. SPPC made a number of new investments, including
a £500,000 investment in Nektan Limited, a software developer in the growing
mobile and online gaming industry. In addition, it made several follow-on
investments during the period, including a US$938,000 investment in Brazil
Potash, which owns a potash mine in Brazil and which is investigating a
flotation on Brazil's BOVESPA, a C$250,000 investment in Homeland Uranium, an
exploration company with uranium prospects in Niger, and a £110,000 investment
Astrakhan Oil, a Russian based oil development company.

The SPPC portfolio of companies continues to develop well. Over the last
year, several of the oil/gas and mineral holdings have demonstrated through
discoveries significant further increases in the value of the deposits they
are developing. These offer the possibility of further large gains on exit.

Puma Brandenburg Limited ("PBL")
PBL's strong operating performance has continued in the period and revenue
growth is expected to continue following rent increases applied in the Berlin
residential portfolio as a result of increases in the Mietspiegel, the local
index which controls the amount by which rents can be raised in certain
apartments. 

PBL actively manages its assets which are situated in prime locations. It has
recently completed the refurbishment works for the existing hotel tenant Accor
in Nuremberg where a 20 year lease had been signed and the Hyatt Hotel in
Cologne is performing strongly following its extensive refurbishment.
Elsewhere in the portfolio, structural vacancy rates have been maintained at
low levels and its successful modernisation programme continues to drive
rental growth and the quality of its residential properties in Berlin. 

It remains focused on value enhancing asset management initiatives and
particularly on extending debt that matures next year to provide long term
finance for the strong portfolio of assets.

Puma Hotels plc ("PHP")
PHP's final results for the year ended 31 December 2012covered a period which
saw significant changes to its operations.As previously reported, the leases
with Barceló Hotels and Resorts were terminated on 25 April 2012 and since
that time the hotels have been operated by PHP.Since taking over the hotel
operations, the existing hotels team has been augmented through a number of
senior appointments and, despite trading conditions remaining challenging for
provincial UK hotels, the PHP team, with Shore Capital's assistance, has been
effective in mitigating the challenges that arise in taking over a business of
this scale.

PHP generated a profit in 2012 of £10.5 million for the year.This return to
profitability was driven by the net lease termination fee of £20.3
millionreceived from Barceló. The receipt of this termination fee allowed PHP
to reduce its senior debt facility by approximately £20 million.

As at 28 June 2013, PHP successfully completed the extension of its £323
million senior debt facility with Irish Bank Resolution Corporation in Special
Liquidation ("IBRC").New terms have been agreed with IBRC until 30 May 2014
with revised covenants to reflect the current operating environment.

Puma Sphera
Following the decision by its largest shareholder to redeem its holdings in
Puma Sphera as it had decided that it preferred to access Puma Sphera's
investment strategy through a private managed account as opposed to through a
fund structure, the Board of Puma Sphera determined to liquidate the fund as
the remaining assets under management resulted in the fund being sub-scale and
uneconomic. Following the redemptions of shares, several shareholders elected
to transfer their interests to the mirror fund of Puma Sphera, namely Sphera
Fund LP. 

Retail Asset Management

Puma Investments brand launched
The Group launched a sub-brand for investment opportunities targeting the
private investor market, called Puma Investments. A new subsidiary, called
Puma Investment Management Limited, which trades as Puma Investments, has been
established and was authorised by the Financial Conduct Authority in May 2013.

Puma Investments has also been appointed as the trading adviser to Puma
Heritage plc and is in the process of launching several new investment
opportunities, including Puma VCT 10, which will follow the same successful
investment strategy of its preceding nine funds, together with Puma EIS. 

Puma Venture Capital Trusts ("VCTs")
The on-going effects of the credit crisis mean that SMEs are still finding it
difficult to access the funding they need from traditional lenders. Our VCTs
seek to meet that demand and focus on providing secured loans to well-run
companies.In particular, we are seeing many established businesses which have
substantial assets or predictable revenue streams, over which a first charge
can be taken, thereby reducing the risks usually associated with venture
capital investing. Our VCTs are each limited-life vehicles, aiming to
distribute the initial capital and returns to their investors after five
years. 

Our market-leading VCT track record is reflected in the fact that the early
Puma VCTs were the first limited-life VCTs to have reached the milestone of
returning 100p per share in cash distributions to shareholders and Puma VCTs 1
to 4 have each produced the highest total return of their respective peer
groups. Since 2005 over £130 million has been raised for Puma VCTs, and more
than £60 million has been distributed as dividends to shareholders.

Puma VCT 9 closed during the period raising over £28.1 million, making it the
largest single company VCT fundraise in the 2012/13 tax year and accounting
for over 10 per cent of the total funds raised in the VCT market in that year
(excluding enhanced share buy-backs). We consider this fund-raising to be a
considerable achievement and an endorsement of our standing in the VCT sector.
We are pleased to be launching our tenth VCT for the current tax year and
hope to capitalise on our excellent track record.

Puma Heritage plc
Puma Heritage was launched in June 2013 seeking minimum investments of
£100,000 to operate in a range of sectors, with a primary focus on secured
lending. Puma Heritage will focus on capital preservation, whilst seeking to
produce regular returns for shareholders intended to counter long-term
inflationary pressures. It is anticipated that Puma Heritage will expand into
other activities as opportunities arise. In particular, the Board of Puma
Heritage envisage that it will offer asset leasing services, as well as, in
the medium to long term, purchasing and operating profitable trading
businesses with asset-backing and established management teams. An investment
in Puma Heritage is intended to benefit from 100 per cent relief from
Inheritance Tax after two years. Puma Investments has been appointed as the
trading adviser to Puma Heritage to advise the company in executing its
business strategy. 

Puma EIS
Puma Investments will launch in the second half of the year a portfolio
service offering investors the opportunity to invest in asset-backed EIS
qualifying companies utilising the team's strong track record and experience
in asset-backed investing gained over the life of the first nine Puma VCTs.
We are excited about the prospects for our Puma EIS based on the demand for
EIS investments which can provide downside protection through asset-backing. 

Principal Finance

Investment in German Telecoms Business

DBD holds radio spectrum licences in Germany in the 3.5 GHz range which is
increasingly being deployed around the world for providing 4G mobile services.
The German mobile market is the largest in Europe, with circa 115 million
subscribers recorded in 2012 generating the largest sector revenues in Europe.
As in other European mobile markets, the deployment of 4G in Germany continues
to drive revenue growth as subscribers demand greater levels of data capacity.
DBD's spectrum is ideally placed to provide mobile operators in Germany with
additional data capacity for smart phones and tablet devices.

Spectrum acquired its original interest in DBD in March 2011. The other two
3.5 GHz licences in Germany were recently acquired by E-Plus, the fourth
largest mobile operator in Germany.

In early 2013, Spectrum raised €3.3 million of new capital from its investors,
including Shore Capital, to fund its acquisition of further loan stock and
equity in DBD. As a result Spectrum now holds, directly and indirectly,
substantially all of the economic interest in DBD. Shore Capital invested
€2.13 million in the Spectrum fundraising and now holds 59.26 per cent of
Spectrum.

As part of the refocusing of DBD's business that was anticipated at the time
of the original acquisition, DBD's consumer business has been reducing and
will cease at the end of September 2013. Following the cessation, ongoing
basic operating costs are anticipated to be reduced to approximately £0.5
million per year.

The consolidated profit before tax in the period arising from this investment
was £0.4 million (2012: loss of £0.7 million). The profit for the half year
includes a credit in respect of the release of historic provisions for
potential liabilities within DBD which are no longer required. This has
contributed £0.66 million to the Group net of minority interests.

We remain confident that this asset can lead to a profitable realisation in
due course.

Current Trading and Prospects

The continued strength of our business demonstrates that confidence is
beginning to return to the economy as more clients look to raise development
capital and seek to engage with innovative, service-orientated advisers.
Based on the solid trading across the Group and the many exciting
opportunities ahead, the Board looks to the future with confidence.

We anticipate that the ECM business will benefit from the improving economic
climate coupled with the renewed interest in AIM, fuelled in part by the
recent change in law allowing investors to hold AIM stocks in their ISAs. Our
highly regarded research and sales team are well placed to continue to
capitalise on their recent success in external surveys, including the Thomson
Reuters StarMine survey in which Shore Capital was named as Europe's third
most productive broker for 2013.

We are also excited about the new investment opportunities being developed by
the asset management division, including the launch of Puma VCT 10 and Puma
EIS which build upon our excellent track record in asset-backed investing.

Howard P Shore
Executive Chairman
16 September 2013

Independent review report to Shore Capital Group Limited (the "Group")

We have been engaged by the Group to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 30
June 2013 which comprises the consolidated income statement, the consolidated
statement of comprehensive income, the consolidated statement of financial
position, the consolidated statement of changes in equity, the consolidated
cash flow statement and related notes 1 to 9. We have read the other
information contained in the in the half-yearly financial report and
considered whether it contains any apparent misstatements or material
inconsistencies with the information in the condensed set of financial
statements.

This report is made solely to the Group in accordance with guidance contained
in International Standard on Review Engagements 2410 (UK and Ireland) "Review
of Interim Financial Information Performed by the Independent Auditor of the
Entity" issued by the Auditing Practices Board. Our work has been undertaken
so that we might state to the Group those matters we are required to state to
it in an independent review report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone
other than the company, for our review work, for this report, or for the
conclusions we have formed.

Directors' Responsibilities
The half-yearly financial report is the responsibility of, and has been
approved by, the directors. The directors are responsible for preparing the
half-yearly financial report as required by the AIM rules issued by the London
Stock Exchange and the Bermuda Stock Exchange.

As disclosed in note 1, the annual financial statements of the Group are
prepared in accordance with IFRSs as adopted by the European Union. The
condensed set of financial statements included in this half-yearly financial
report has been prepared in accordance with International Accounting Standard
34, "Interim Financial Reporting", as adopted by the European Union.

Our Responsibility
Our responsibility is to express to the Group a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.

Scope of Review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.

Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2013 is not prepared, in all
material respects, in accordance with International Accounting Standard 34 as
adopted by the European Union, and the AIM rules of the London Stock Exchange.

Deloitte LLP
Chartered Accountants
Guernsey, Channel Islands

16 September 2013

Consolidated Income Statement
For the six months ended 30 June 2013 (unaudited)

                                     Six months   Six months  Year ended
                                          ended        ended 31 December
                                   30 June 2013 30 June 2012        2012
                             Notes
                                          £'000        £'000       £'000

Revenue                        3         17,797       17,760      32,821

Administrative expenditure             (14,468)     (16,068)    (29,973)

Operating profit                          3,329        1,692       2,848

Interest income                            145          146         314
Finance costs                             (169)        (357)       (635)

Profit before taxation         3          3,305        1,481       2,527

Taxation                                  (552)        (378)       (494)

Profit for the period                     2,753        1,103       2,033


Attributable to:
Equity holders of the parent              2,002        1,158       1,987
Non controlling interests                   751         (55)          46

                                          2,753        1,103       2,033

Earnings per share
Basic                          4          0.83p        0.48p       0.82p
Diluted                        4          0.82p        0.47p       0.82p

Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2013 (unaudited)

                                      Six months   Six months  Year ended
                                           ended        ended 31 December
                                    30 June 2013 30 June 2012        2012
                                           £'000        £'000       £'000
Profit for the period                      2,753        1,103       2,033

Items that will not be reclassified
subsequently to profit or loss:
Gains/(losses) on cash flow hedges           263         (11)          68
Taxation                                    (61)            3        (17)
                                             202          (8)          51
Exchange difference on translation            52         (54)        (62)
of foreign operations
Other comprehensive income for               254         (62)        (11)
the period, net of tax, from
continuing operations

Total comprehensive income for the         3,007        1,041       2,022
period, net of tax

Attributable to:
Equity holders of the parent               2,238        1,152       1,971
Non controlling interests                    769        (111)          51
                                           3,007        1,041       2,022

Comprehensive earnings per
share
Basic                                      0.93p        0.48p       0.82p
Diluted                                    0.92p        0.47p       0.81p

Consolidated Statement of Financial Position
As at 30 June 2013 (unaudited)

                                   Notes        As at        As at     As at 
                                         30 June 2013 30 June 2012 31 December
                                                                          2012

                                                £'000        £'000       £'000
Non-current assets
Goodwill                                          381          381         381
Intangible assets                               4,202        4,106       4,055
Property, plant & equipment                    12,038       11,908      11,669
Available-for-sale investments                  4,221        4,402       4,105
                                               20,842       20,797      20,210
Current assets
Bull positions and other holdings               4,145        9,582       4,058
designated at fair value
Available-for-sale investments                     16           32          16
Trade and other receivables                    96,157      100,947      65,819
Tax assets                                          -          350          99
Cash and cash equivalents                      32,457       25,545      30,443
                                              132,775      136,456     100,435
Total assets                         3        153,617      157,253     120,645
Current liabilities
Bear positions                                  (660)      (1,043)     (1,395)
Trade and other payables                     (73,579)     (78,366)    (41,146)
Derivatives                                     (351)        (596)       (573)
Tax liabilities                                 (415)            -           -
Borrowings                                      (350)        (339)       (327)
                                             (75,355)     (80,344)    (43,441)
Non-current liabilities
Borrowings                                    (9,885)     (11,351)    (10,549)
Deferred tax liability                          (340)        (339)       (224)
Provision for liabilities and                    (54)         (39)        (44)
charges
                                             (10,279)     (11,729)    (10,817)
Total liabilities                    3       (85,634)     (92,073)    (54,258)
Net Current Assets                             57,420       56,112      56,994
Net Assets                                     67,983       65,180      66,387

Equity
Capital and Reserves
Called up share capital                             -            -           -
Share premium account                             336          336         336
Merger reserve                                 27,198       27,198      27,198
Other reserves                                  1,470        1,181       1,282
Retained earnings                              31,253       30,183      30,954
Equity attributable to equity                  60,257       58,898      59,770
holders of the parent
Non controlling interests                       7,726        6,282       6,617
Total equity                                   67,983       65,180      66,387

Consolidated Statement of Changes in Equity
For the six months ended 30 June 2013 (unaudited)

                           Share   Share  Merger    Other Retained         Non  Total
                         capital Premium reserve reserves earnings Controlling
                                 account                             interests
                           £'000   £'000   £'000    £'000    £'000       £'000  £'000
At 1 January 2012                    336  27,198    1,187   29,867       6,841 65,429
Retainedprofitforthe        -       -       -        -    1,158        (55)  1,103
period
Foreign currency               -       -       -        -        -        (54)   (54)
translation
Valuationchangeoncash       -       -       -      (6)        -         (2)    (8)
flow hedge
Equity dividends paid          -       -       -        -    (604)           -  (604)
Dividends paid to non          -       -       -        -    (238)       (534)  (772)
controlling interests
Investment by non              -       -       -        -        -          86     86
controlling interest in
subsidiaries including
Spectrum
At 30 June 2012               -     336  27,198    1,181   30,183       6,282 65,180



                       Share   Share  Merger    Other Retained         Non  Total
                     capital Premium reserve reserves earnings Controlling
                             account                             interests
                       £'000   £'000   £'000    £'000    £'000       £'000  £'000
At 30 June 2012           -     336  27,198    1,181   30,183       6,282 65,180
Retained loss for          -       -       -        -      829         101    930
the period
Credit                     -       -       -       54        -           -     54
inrelationtoshare
based payments
Foreign currency           -       -       -        -     (58)          50    (8)
translation
Valuation change on        -       -       -       47        -          12     59
cash flow hedge
Dividends paid to          -       -       -        -        -           6      6
non controlling
interests
Investment by non          -       -       -        -        -         166    166
controlling interest
in subsidiaries
including Spectrum
At 31 December 2012       -     336  27,198    1,282   30,954       6,617 66,387


Consolidated Statement of Changes in Equity (continued)
For the six months ended 30 June 2013 (unaudited)

                              Share   Share  Merger    Other Retained         Non   Total
                            capital Premium reserve reserves earnings Controlling
                                    account                             interests
                              £'000   £'000   £'000    £'000    £'000       £'000   £'000
At 1 January 2013                 -     336  27,198    1,282   30,954       6,617  66,387
Retained profit for the           -       -       -        -    2,002         751   2,753
year
Foreign currency                  -       -       -        -       74        (22)      52
translation
Creditinrelationtoshare       -       -       -       26        -           -      26
based payments
Valuation change on cash          -       -       -      162        -          40     202
flow hedge
Equity dividends paid             -       -       -        -  (1,208)           - (1,208)
Dividends paid to non             -       -       -        -    (239)       (590)   (829)
controlling interests
Investment by non                 -       -       -        -        -         138     138
controlling interest in
subsidiaries other than
Spectrum/DBD
Adjustments arising from          -       -       -        -    (330)         792     462
change in non controlling
interest in Spectrum/DBD
(see note 7)
At 30 June 2013                  -     336  27,198    1,470   31,253       7,726  67,983

Consolidated Cash Flow Statement
For the six months ended 30 June 2013 (unaudited)

                                           Six months   Six months  Year ended
                                                ended        ended 31 December
                                         30 June 2013 30 June 2012        2012
                                                £'000        £'000       £'000
Cash flows from operating activities
Operating profit                                3,329        1,692       2,848
Adjustments for:
  Depreciation charges                            469          598         871
  Amortisation charges                             73            -         243
  Share-based payment expense                      26           36          54
  (Profit)/loss on available-for-sale           (173)          502         871
  investments
  Increase in provision for NIC on                 10            3           8
  options
Operating cash flows before movement in         3,734        2,831       4,895
working capital
  Increase in trade and other                (30,338)     (58,266)    (23,138)
  receivables
  Increase in trade and other payables         32,474       53,288      16,160
  (Decrease)/increase in bear                  (735)          257         609
  positions
  (Increase)/decrease in bull positions          (87)      (2,534)       2,990
Cash generated/(utilised) by operations         5,048      (4,424)       1,516
  Interest paid                                 (169)        (357)       (635)
  Corporation tax paid                             22         (36)        (35)
Net cash generated/(utilised) by                4,901      (4,817)         846
operating activities
Cash flows from investing activities
  Purchases of fixed assets                     (109)         (28)       (614)
  Acquisition of further holding in DBD       (1,731)            -           -
  (see note 7)
  Proceeds on disposal /(purchase) of              57          (6)       (190)
  AFS investments
  Purchase of additional intangible                 -        (180)        (82)
  assets
  Sale of AFS investments                           -           25          51
  Interest received                               145          146         314
Net cash utilised by investing                 (1638)         (43)       (521)
activities
Cash flows from financing activities
  Shares/participations issued in               1,142           86         252
  subsidiaries to non controlling
  interests (see note 7)
  Decrease in borrowings                        (175)     (15,650)    (16,079)
  Dividends paid to non controlling             (829)        (772)       (766)
  interests
  Dividends paid to Equity Holders            (1,208)        (604)       (604)
Net cash utilised by financing                (1,070)     (16,940)    (17,197)
activities
Net increase/(decrease) in cash and             2,193     (21,800)    (16,872)
cash equivalents
during the period
Effects of exchange rate changes                (179)           40          10
Cash and cash equivalents at beginning         30,443       47,305      47,305
of period
Cash and cash equivalents at end of            32,457       25,545      30,443
period


Notes to the Interim Financial Report
For the six months ended 30 June 2013 (unaudited)

1. Financial information
   Basis of preparation

   The annual financial statements of Shore Capital Group Limited (the
   "Group") are prepared in accordance with International Financial Reporting
   Standards as adopted by the European Union. The condensed set of financial
   statements included in this interim financial report for the period ended
   30 June 2013 has been prepared in accordance with International Accounting
   Standard 34 "Interim Financial Reporting", as adopted by the European
   Union.
   Going concern

   The group's business activities, together with the factors likely to affect
   its future development, performance and position are set out in the
   Chairman's Statement on pages 3 to 9, together with the financial position
   of the Group, its liquidity position and borrowing facilities. In addition,
   the principal risks and uncertainties of the Group are discussed in note 2
   to this interim financial report.
   The Group has considerable financial resources together with an established
   business model. As a consequence, the directors believe that the group is
   well placed to manage its business risks successfully despite the current
   uncertain economic outlook.
   After making enquiries, the directors have a reasonable expectation that
   the Group has adequate resources to continue in operational existence for
   the foreseeable future. Accordingly, they continue to adopt the going
   concern basis in preparing the financial statements.
   Significant accounting policies

   The same accounting policies, presentation and methods of computation are
   followed in the condensed set of financial statements as are applied in the
   Group's latest audited Annual Report and Accounts for the year ended
   31December 2012.
2. Principal risks and uncertainties

   The Group's policies for managing the risks arising from its activities are
   set out in the last audited Annual Report and Accounts of the group that
   were issued on 22 March 2013. The Group's activities comprise equity market
   activities and investment in alternative assets and property, and its
   income is therefore subject to the level of general activity, sentiment and
   market conditions in each of the markets in which it operates.
3. Segmental information

   For management purposes, the Group is organised into business units based
   on their services, and has reportable operating segments as follows:
     *Equity Capital Markets provides research in selected sectors, broking
       for institutional and professional clients, market-making in AIM and
       small cap stocks and corporate finance for mid and small cap companies.
     *Asset Management and Principal Finance provides advisory and
       discretionary fund management services, manages specialist funds
       invested in alternative asset classes, and conducts principal finance
       activities using our own balance sheet.
     *Balance sheet holdings comprises investments made using our own balance
       sheet.
   Spectrum represents our investment in a German Telecoms business.
   Management monitors the operating results of its business units  separately 
   for  the  purpose  of  making  decisions  about  resource  allocation   and 
   performance  assessment.  Segmental  performance  is  evaluated  based  on 
   operating profit or loss.
   Transfer prices between operating segments are on an arm's-length basis  in 
   a manner similar to transactions with third parties.

6 months ended      Equity      Asset   Balance Central Spectrum Consolidated
30 June 2013       Capital Management Sheet and   costs
                   Markets            Principal
                                        Finance
                     £'000      £'000     £'000   £'000    £'000        £'000
Revenue             12,605      3,882       744       -      566       17,797
Results
Depreciation           128         56       262      23        -          469
Segment profit/      3,074        789     (275)   (676)      393        3,305
(loss) before tax
Assets              99,211      4,760    42,012   1,335    6,299      153,617
Liabilities       (73,390)    (1,271)   (9,362)   (391)  (1,220)     (85,634)



6 months ended      Equity      Asset   Balance Central Spectrum Consolidated
30 June 2012       Capital Management Sheet and   costs
                   Markets            Principal
                                        Finance
                     £'000      £'000     £'000   £'000    £'000        £'000
Revenue             11,550      3,972     1,028       -    1,210       17,760
Results
Depreciation            63         79       257      26      173          598
Segment profit/      2,839        504     (123) (1,010)    (729)        1,481
(loss) before tax
Assets             101,554      5,882    41,388   2,097    6,332      157,253
Liabilities       (77,641)      (144)   (9,782)   (884)  (3,622)     (92,073)



Year ended         Equity      Asset   Balance Central Spectrum Consolidated
31 December 2012  Capital Management Sheet and   costs
                  Markets            Principal
                                       Finance
                    £'000      £'000     £'000   £'000    £'000        £'000
Revenue            22,653      6,331     1,646      10    2,181       32,821
Results
Depreciation          157        153       511      50        -          871
Segment profit/     5,056        955     (303) (2,018)  (1,163)        2,527
(loss) before tax
Assets             63,792      3,830    46,314   1,179    5,530      120,645
Liabilities        37,965      1,184    10,875     966    3,268       54,258

4. Earnings per share
   The calculation of the basic and diluted earnings per share is based on the
   following:

                                           Six months   Six months  Year ended
                                                ended        ended 31 December
                                         30 June 2013 30 June 2012        2012
Earnings (£)                                2,002,000    1,158,000   1,987,000
Number of shares
              Basic
Weighted average number of shares         241,639,601  241,639,601 241,639,601
              Diluted
Dilutive effect of share option scheme      2,137,378    2,273,236   1,721,409
                                          243,776,979  243,912,837 243,361,010

Earnings per share
              Basic                             0.83p        0.48p       0.82p

              Diluted                           0.82p        0.47p       0.82p

5. Rates of dividends paid and proposed

                                     Six months    Six months       Year ended
                                          ended         ended 31 December 2012
                                   30 June 2013  30 June 2012
                                          £'000         £'000            £'000
Amounts recognised as
distributions to equity holders
in the period:
Final dividend for the year ended         1,208           604              604
31December 2012 of
0.50p (2011: 0.25p) per share
No interim dividend for the year              -             -                -
ended 31 December 2012
                                          1,208           604              604
Proposed interim dividend for the           967
year ended
31December 2013 of 0.40p per
share

6. Called up share capital

Shore Capital Group Limited - ordinary shares of  Number of shares £'000
nil par value
At 1 January 2012                                         241,639,601        -
                                                                    -        -
At 30 June 2012                                           241,639,601        -
                                                                    -        -
At 31 December 2012                                       241,639,601        -
                                                                    -        -
At 30 June 2013                                           241,639,601        -

7. Events during the period
   Further investment in Spectrum/DBD:  During the period, Spectrum raised
   €3.30 million of new capital from its investors, with €2.13 million being
   invested by Shore Capital and €1.17 million (£1.004 million) being invested
   by other existing shareholders. Of the money raised, €2.0 million (£1.731
   million) was utilised to acquire further equity and the remaining
   shareholder loans in DBD.
   The following table is an analysis of adjustments arising from this further
   investment as shown in the Consolidated Statement of Changes in Equity:

                                              Retained Non controlling   Total
                                              earnings        interest   £'000
                                                 £'000           £'000
Investment by non controlling interests in          -           1,004   1,004
Spectrum
Acquisition by Spectrum of equity              (1,028)           (703) (1,731)
and shareholder loans in DBD
Net cash movement                              (1,028)             301   (727)
Shareholder loans acquired in DBD                  698             491   1,189
Net gain/(loss) in Statement of                  (330)             792     462
Changes in Equity

8. Events after the period
   i. Dividend: The Group has declared an interim dividend of 0.40p per share
   (see note 5).
   ii. Acquisition of shares: The Group notified the market that following
   acquisitions of shares on 29 July and 13 August 2013, it has a beneficial
   interst of 21.99% in The Hotel Corporation plc.
9. Financial instruments
   Fair value of financial instruments
   Fair value  is the  amount for  which an  asset could  be exchanged,  or  a 
   liability settled,  between  knowledgeable,  willing parties  in  an  arm's 
   length transaction.
   For  trading  portfolio  assets  and  liabilities,  financial  assets   and 
   liabilities  designated   at   fair   value   and   financial   investments 
   available-for-sale which  are  listed  or otherwise  traded  in  an  active 
   market,  for   exchange-traded  derivatives,   and  for   other   financial 
   instruments for which quoted prices in an active market are available, fair
   value is determined directly from those quoted market prices (level 1).
   For financial instruments which do  not have quoted market prices  directly 
   available from an active market, fair values are estimated using  valuation 
   techniques, based wherever possible on assumptions supported by  observable 
   market prices or  rates prevailing  at the  Balance Sheet  date (level  2). 
   This is the case for some  unlisted investments and other items which  are 
   not traded in active markets.
   For some types  of financial  instruments, fair values  cannot be  obtained 
   directly  from  quoted  market   prices,  or  indirectly  using   valuation 
   techniques or models supported by observable market prices or rates.  This 
   is the case for certain unlisted  investments. In these cases, fair  value 
   is estimated indirectly using valuation techniques for which the inputs are
   reasonable assumptions, based on market conditions (level 3).

30 June 2013                               Level 1    Level 2    Level 3
                                            Quoted     Market       Non- Total
                                            market observable     market
                                             price     inputs observable
                                                                  inputs
                                             £'000      £'000      £'000 £'000
Available-for-sale financial investments     2,815         16      1,406 4,237
Bull positions and other holdings at fair    4,145          -          - 4,145
value
Total financial assets                       6,960         16      1,406 8,382
Bear positions                                 660          -          -   660
Derivatives                                      -        351          -   351
Total financial liabilities                    660        351          - 1,011



30 June 2012                              Level 1    Level 2    Level 3
                                           Quoted     Market       Non-  Total
                                           market observable     market
                                            price     inputs observable
                                                                 inputs
                                            £'000      £'000      £'000  £'000
Available-for-sale financial investments    3,111         32      1,291  4,434
Bull positions and other holdings at        9,582          -          -  9,582
fair value
Total financial assets                     12,693         32      1,291 14,016
Bear positions                              1,043          -          -  1,043
Derivatives                                     -        596          -    596
Total financial liabilities                 1,043        596          -  1,639

31 December 2012                           Level 1    Level 2    Level 3
                                            Quoted     Market       Non- Total
                                            market observable     market
                                             price     inputs observable
                                                                  inputs
                                             £'000      £'000      £'000 £'000
Available-for-sale financial investments     2,793         16      1,312 4,121
Bull positions and other holdings at fair    4,058          -          - 4,058
value
Total financial assets                       6,851         16      1,312 8,179
Bear positions                               1,395          -          - 1,395
Derivatives                                      -        573          -   573
Total financial liabilities                  1,395        573          - 1,968

 Included in the fair value of  financial instruments carried at fair  value 
   in the statement of  financial position are those  estimated in full or  in 
   part using valuation techniques based on assumptions that are not supported
   by market observable prices or rates (level 3).
   There may be uncertainty  about a valuation, resulting  from the choice  of 
   valuation technique  or  model  used, the  assumptions  embedded  in  those 
   models, the  extent to  which inputs  are not  market observable,  or as  a 
   result of other elements affecting such uncertainties and are deducted from
   the fair value produced by valuation techniques.
   There have been no significant movements between level 1 and level 2 during
   the period.
   The following  table shows  a  reconciliation of  the opening  and  closing 
   amount of Level 3  financial assets and liabilities  which are recorded  at 
   fair value:



                          At 1    Losses Purchases Sales and     At 30
                       January  recorded       and transfers June 2013
                          2013 in profit transfers
                                 or loss
                         £'000     £'000     £'000     £'000     £'000
Total financial assets   1,312        89        47      (42)     1,406

 Based on the established fair value  and model governance policies and  the 
   related controls and  procedural safeguards the  Group employs,  management 
   believe the resulting estimates in fair values recorded in the statement of
   financial position are reasonable and the most appropriate at the  Balance 
   Sheet date.
   The interim report will be posted in due course to shareholders on the
   register. Further copies of this report are available on the Company's
   website at www.shorecap.gg.

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information contained therein.

Source: Shore Capital Group Limited via Thomson Reuters ONE
HUG#1729246
 
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