AIM recovery hits the buffer as number of companies leaving market rises

4 July 2011

  • Average amount of money raised in IPOs shrinks to £3.6 million
  • But number of new listings bounces back

The recovery of the AIM market has been knocked off course for a second quarter in a row as the number of companies delisting jumped 50% in Q2 2011 and the money raised in AIM IPOs fell, reveals our latest research.

42 companies left AIM in Q2 2011, up from 28 in Q1 2011. UHY Hacker Young points out that this is the largest quarterly increase in the number of companies leaving AIM since Q4 2009, during recession. (See table below)

The average amount of new money raised per AIM IPOs has fallen to approximately£3.6m in the first part of this year (five months to May 31st 2011). This is down 70% from the average £12m in new money raised per IPO over the same period in 2010.

The appetite for new IPOs amongst investors has dropped off in the last six months, as the Eurozone crisis and rising oil prices have buffeted investor confidence.

Tellingly, the ability of AIM companies to raise money in the secondary markets has suffered as well, with a five companies saying they are leaving AIM after struggling to raise money through secondary issues.

Total money raised through IPOs to the end of May is down overall from £328 million in 2010, to just £91 million this year.

Laurence Sacker, corporate finance partner in our London office, comments: “The sheer size of AIM means that you can’t expect AIM to be immune from the big trends in the global economy. AIM is not a sleepy backwater anymore. If the Eurozone is in crisis or the UK economy is stagnating because of Government cost cutting then that is going to impact the fortunes of AIM listed companies.”

“AIM had built up a real head of steam towards the end of 2010. It would be a shame to see its recovery fizzle out so prematurely.”

AIM has also seen a slight rise in the number of companies leaving AIM as a result of financial stress and insolvency, up 29% year-on-year, from 17 in the first half of 2010 to 22 over the same period this year.

Still hope for AIM as number of new listings more than doubles

A jump in the number of new AIM listings offers some hope that the market could get back on the road to recovery.

The number of companies joining AIM more than doubled to 16 in Q2 2011, up from just seven in the first quarter. New listings are also up 23%, year-on-year, from 13 in Q2 2010.

Laurence explains: “Despite its struggles, AIM remains an attractive prospect for many young firms.”

In another positive sign for AIM, the number of companies graduating from AIM to the Main Market of the London Stock Exchange is at its highest level since Q2 2008. Five companies left AIM for the Main market in Q2 2011.

Similarly, the number of companies leaving as result of M&A activity is on the rise, with 13 companies leaving due to M&A (excluding reverse takeovers) in Q2 2011, up from 10 in Q1 2011.

“Losing companies because they have graduated to the Main Market, or due to M&A activity is a sign that a market is healthy.”

“It shows that companies joining AIM have confidence that the market will allow them to grow and take their businesses on to the next stage in their development.”

Increase in companies leaving AIM

Reasons for delisting from AIMApr 10 -
Jun 10
Jul 10 -
Sep 10
Oct 10 -
Dec 10
Jan 11 -
Mar 11
Apr 11 -
Jun 11
AIM too expensive / too much of a burden 3 7 3 6 4
Change of listing to other exchange 6 5 2 1 6
Failure of strategy/ Low share price and/or liquidity 6 5 2 1 5
Financial stress & insolvency 7 8 8 10 12
M&A 12 20 16 10 13
No NOMAD 1 0 1 0 2
Total 36 45 32 28 42
Total leaving for negative reasons* 20 22 14 18 24
Listings 13 16 23 7 16

 

*Excluding M&A and graduation to Main Market

Keep up to date

We produce a range of informative publications focusing on the latest accounting issues. Click to add yourself to our mailing list.

Subscribe

Latest news

UHY Hacker Young appoints new Audit Partner from Grant Thornton

Subarna Banerjee, formerly Audit Director at Grant Thornton UK LLP, is joining our London office as an audit partner and will Chair our charity and not-for-profit group.
read more...

HMRC tighten up disclosure rules

HMRC have announced a number of changes to the Liechtenstein Disclosure Facility to limit the benefits for those that HMRC sees as abusing the arrangement.
read more...

Bank lending in the UK is still stalling, down 2.2% in real terms last year - and far behind G7 average

In our recent study we have found that bank lending to the private sector in the UK is still lagging far behind the G7 average, despite all the Government’s efforts to boost the availability of credit.
read more...

28 out of Top 30 highest income tax areas are 'Stockbroker Belt' towns

Our research shows this is due to the shift of the tax burden onto higher earners, who have been hit by an increase in the upper rate of tax, which now sits at 45p.
read more...

Money raised in IPOs on AIM triples - highest sum in six years

The Alternative Investment Market has delivered its biggest year for IPOs since 2007/8.
read more...

Demands on academy governors prompting growing recruitment crisis

Our recent research into academy school governance shows that the increased responsibilities placed on Governors at academy schools risk creating a recruitment crisis.
read more...

HMRC pays out £4.6 billion in corporation tax refunds

Figures obtained by us reveal that some 286,000 businesses received a corporation tax rebate in the year to 31 March 2013.
read more...

Information flows from Switzerland to HMRC...

The 2011 UK-Swiss Tax Agreement is concerned not just with the levying of withholding taxes. It also provides for the passing of information in respect of Swiss accounts to HMRC.
read more...

London’s Silicon Roundabout remains top area for UK start-ups

Our recent research shows that the area around Silicon Roundabout is once again the most prolific area of new business generation in the UK.
read more...

Small Cap Awards winners announced

Sponsored by UHY Hacker Young, The Small Cap Awards winners have been announced.
read more...

The Small Cap Awards 2014 Nominees

Sponsored by UHY Hacker Young, The Small Cap Awards shortlist nominations have been announced.
read more...

The Small Cap Awards 2014

Sponsored by UHY Hacker Young, The Small Cap Awards will shine a light on the best companies and participants in the small and micro-cap community.
read more...

1 in 2 HMRC VAT fines against businesses ruled incorrect

HMRC has disclosed that one in two penalties it issues against businesses for the late filing of VAT are incorrect.
read more...

HMRC use of external debt collectors more than doubles in two years

HMRC has doubled its use of private sector bailiffs and debt collection agencies over the last two years as it takes more aggressive action to chase overdue tax.
read more...

Swiss/UK Tax Agreement is like the Cheese - Full of Holes!

Under the terms of the Swiss/UK Tax Cooperation Agreement, most UK-resident holders of Swiss accounts were offered a simple choice.
read more...

British companies struggling with world's major economies highest fuel costs

The UK has the highest petrol pump prices of any major world economy, hitting businesses hard as they struggle to pull out of recession.
read more...

Cost of listing on AIM rises as companies seize window of opportunity to raise funds

The professional fees paid by companies to brokers and nomads for a placing on AIM now account for 9.5% of all funds raised, up from 8.4% in the previous 12 months.
read more...

A chance to come clean about your second income

HMRC have announced a “Second Incomes Campaign”, the latest in a series of opportunities for non-compliant taxpayers to provide details of undisclosed income.
read more...

Aberdeen has UK's biggest increase in disposable income since the credit crunch

The average household disposable income for the UK’s Top 40 towns and cities has risen by just £1,761 over the same period to £14,068. 
read more...

Employment Allowance: Up to £2,000 off your Class 1 NICs

From 6 April 2014, Employment Allowance maybe available to you if you are a business or charity that pays employer Class 1 NICs on your employees’ or directors’ earnings.
read more...

Biggest year for IPOs on AIM since 2007

The Alternative Investment Market (AIM) has delivered the biggest year for IPOs since 2007/8, with the 76 companies that floated in the last 12 months raising £2.2billion.
read more...

Budget 2014: what does it mean for the legal sector?

Of particular note was the confirmation that the new rules applying to LLPs will go ahead from 6 April 2014.  Additionally, there were other announcements that could be of relevance to the sector.
read more...

UK and Ireland have highest death duties of all major economies

The UK government would typically take 25.8% from the estate of an individual passing on assets worth US$3m* to their heirs, well above the global average of 7.67%.
read more...

Budget 2014: what does it mean for the charity and not-for-profit sector?

Amongst the Budget 2014 detail there were some announcements which affect the charity and not-for-profit sector, with some charities in specific benefiting from the proposed budget.
read more...

Banksy's larger than life Lab Rat finally finds home big enough

Banksy’s rediscovered ‘Lab Rat’ painting has finally found a home big enough to house it, and now hangs in our London office.
read more...

HMRC's tax take from Capital Gains Tax investigations jumps by a third this year - hitting record highs

Our research shows buy-to-let landlords and multiple home owners are under particular scrutiny.
read more...

Starting 2014 with a strengthened national presence

We are starting 2014 with a strengthened national presence, following a series of acquisitions, re-brandings and the appointment of new hires.
read more...

Latest publications

2014 Academies Financial Handbook

Download our summary and comments on the newly released 2014 Academies Financial Handbook.
read more...

Doing business in the UK

A detailed report providing key issues and information for investors considering a business operation in the UK.
read more...

Experience with stock market clients

Our Capital Markets specialists have significant experience advising and supporting fully listed, AIM and ISDX clients. This document provides a list of stock market clients as at August 2014.
read more...

Academy schools update: August 2014

Download our most recent academy schools update which concentrates on the risks involved with academy governance, the academies Risk Protection Arrangement, your impending auto enrolment staging date, the recent EFA investigations into academies and handy tips for the lead up to your audit.
read more...

Taxflash: Users of tax schemes face large tax bills this Summer

news7.gif

Our dedicated tax investigations team can provide impartial and practical advice in how to deal with the very real consequences of participating in a tax scheme.
read more...

UK tax guide 2014/15

Download our guide for practical tax tips to guide you through the tax system and help you plan to minimise your liability.
read more...

UHY's AIM Review 2013/14

As part of our commitment to the small cap community we have developed a review of the AIM market.  
read more...

Tax update, issue 43

news11.gif

Our regular summary of all the latest tax issues that will affect you and your business.
read more...

Cryptocurrencies: Bitcoin explained

news11.gif

Why Bitcoin has taken the financial spotlight this year.
read more...

VATflash July 2014

news2.gif

Our July VATflash discusses the changes to customs procedures for imports of goods into the European Union.
read more...

Dealsflash: London Nusantara Plantations plc

news6.gif

We recently acted as reporting accountants for the admission to ISDX of London Nusantara Plantations plc.
read more...

UHY Insights: Financing Growth, June 2014

FD forum 2012 image

Following our recent FD Forum we would like to share with you the UHY Insights paper on Financing Growth. This document highlights the importance to businesses of being informed and prepared and contains useful information and recommendations to help achieve this.
read more...

UHY International Business issue 29

news6.gif

The latest issue of our twice-yearly publication featuring articles on current business affairs in countries & business cultures around the world.
read more...

UHY service offering to Academy schools

Whether you are thinking of converting to academy school status or have already done so, we can help you with the complex array of issues you will need to deal with from best value audit and accounts to preparation to fundraising and VAT issues.
read more...

Taxflash: Mileage rates - June 2014

news7.gif

HMRC regularly publish approved ‘fuel only’ rates which have, again, changed.
read more...

Why UHY?

Corporategraphic 14

UHY is a cohesive international network of independent member firms providing audit, accounting, tax and business advisory services across the globe.
read more...

Academy schools: Multi-academy trust services

School 4

Our academy specialists can advise and support you and your MAT from initial set-up and ongoing as auditors.
read more...

Buy to let properties - tax considerations

Property

Should properties be owned personally or through a limited company?
read more...

Rural and agriculture sector outlook 2014/15

This booklet provides our perspective, as accountants, on some of the issues facing the rural and agriculture sector for the 2014/2015 fiscal year.
read more...

Academy schools: Multi-academy trusts factsheet

Download our summary guide to understanding multi-academy trusts.
read more...

Natural resources: Oil, gas and mining sector

Our specialists have been active in the natural resources industry for many years and have experience advising clients across the spectrum of the sector.
read more...

Academy schools update: April 2014

School 4

Download our most recent issue of our regular academy schools updates.
read more...

Auto enrolment: workplace pensions

Our financial management specialists can help assist you in preparing your business for auto enrolment and ensure you comply with all your duties as an employer.
read more...

Tax card

news11.gif

Our pocket-sized tax card is a handy little publication which outlines all the latest tax rates, allowances and some useful key dates for the 2014/15 tax year.

 
read more...

Tax card

news11.gif

Our pocket-sized tax card is a handy little publication which outlines all the latest tax rates, allowances and some useful key dates for the 2014/15 tax year.
read more...

Compliance services for the legal sector

Our legal sector specialists at UHY have the technical understanding of the SRA Accounts Rules 2011 combined with legal sector experience to enable us to support you with your compliance needs.
read more...

UHY Insights: Cyber Security, March 2014

Following our recent FD Forum we wanted to share with you the UHY Insights paper on Cyber Security which highlights the importance of protecting the critical information assets.
read more...