This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the company's obligations under Article 17 of MAR.

10 May 2022

DSW CAPITAL PLC

("DSW Capital", "DSW" or the "Group")

(AIM: DSW)

Trading Update, Notice of Final Results and Investor Event

FY22 ahead of market expectations

DSW Capital, a profitable, fast growing, mid-market, challenger professional services licence network and owner of Dow Schofield Watts brand, announces the following trading update ahead of the Group's Final Results for the year ended 31 March 2022 ("FY22" or the "Period"), which will be released on 14 July 2022.

The Group has continued to trade strongly, following its IPO in December 2021, and the Board is pleased to report that expected Revenue and Adjusted Pre-Tax Profit¹ for FY22 are ahead of market expectations, subject to audit.  Expected Network Revenue for FY22 of £18.3 million (FY21: £15.3 million) is significantly ahead of market expectations and 19.6% ahead of the prior year.  

The DSW Network, which comprises 20 licensee businesses, benefited from high levels of demand in the professional services sector throughout the Period and, in February 2022, DSW was named by Experian as one of the top 20 most active corporate finance advisers in the UK in 2021. Average Revenue per Fee Earner increased by 15.8% in the Period to £227k (FY21: £196k ²). As anticipated, the heightened profile of DSW resulting from the IPO augmented recruitment across the licensee businesses. Fee Earners at 31 March 2022 totalled 88, a 14.3% increase on the prior year.

As previously announced, DSW Capital successfully executed on its strategy to expand its service lines following IPO with the addition of DSW Asset Based Lending Risk Management LLP in January 2022.  This brought the total number of licensees to 20 across 11 service lines. Since the Period end, the Group has welcomed two new partners in Scotland, expanding both the service offering and presence to include Edinburgh and Glasgow.

¹ Adjusted Pre-Tax Profit excludes IPO costs and share based payment charge.

² Prior year comparative calculated using average Fee Earners in the Period which will be basis for the KPI calculation going forward.

James Dow, Chief Executive Officer of DSW Capital, said:

"I am delighted to announce a strong performance for FY22 with the Group expected to report results ahead of expectations both in terms of revenue and adjusted profits. These results are underpinned by the significant market demand for DSW's expert service lines and our performance illustrates the considerable benefits of our platform model, which empowers ambitious professionals to seize the opportunities in the market.

"The autonomy and flexibility which the DSW model gives to Fee Earners is a true differentiator in our market and we believe that it will continue to attract high quality professionals seeking greater flexibility in a post-Covid world."

Investor Event

The Board is also pleased to announce that DSW Capital will be presenting and exhibiting at the Mello 2022 investor conference on Wednesday 25th May 2022 to be held at the Clayton Hotel Chiswick, Chiswick High Road, London, W4 5RY.

For further information please visit the event website at https://melloevents.com/mello2022/.

Enquiries:

Notes to Editors  

About DSW Capital

DSW Capital, owner of the Dow Schofield Watts brand, is a profitable, fast growing, mid-market, challenger professional services network with a cash generative business model and scalable platform for growth. Originally established in 2002, by three KPMG alumni, DSW is one of the first platform models disrupting the traditional model of accounting professional services firms. At the Period end DSW operated licensing arrangements with 20 licensee businesses with 88 fee earners ("FEs"), across seven offices in England and one in Scotland. These trade primarily under the Dow Schofield Watts brand.

DSW's vision is for the DSW Network to become the most sought-after destination for ambitious, entrepreneurial professionals to start and develop their own businesses. Through a licensing model, DSW gives professionals the autonomy and flexibility to fulfil their potential. Being part of the DSW Network brings support benefits in recruitment, funding and infrastructure. DSW's challenger model attracts experienced, senior professionals, predominantly with a "Big 4" accounting firm background, who want to launch their own businesses and recognise the value of the Dow Schofield Watts brand and the synergies which come from being part of the DSW Network.

DSW aims to scale its agile model through organic growth, geographical expansion, additional service lines and investing in "Break Outs" (existing teams in larger firms). The Directors are targeting high margin, complementary, niche service lines with a strong synergistic fit with the existing DSW Network.