On 19th June 1995, the Alternative Investment Market (AIM) was launched in the UK, starting with 10 companies that had a combined value of £82 million. The Alternative Investment Market is part of the London Stock Exchange, and has gained a reputation for having relatively small (when compared to the FTSE 100) but fast-growing companies list on there.
Just 20 years on, there are 1074 businesses on AIM, with an aggregate market capitalisation of £75bn. In total there have been 3602 companies listed on AIM, which have raised a total of £92bn. According to a recent report, all of the UK companies listed on AIM have created £25bn in GBP and produced 731,000 jobs. Many companies on there have grown at an incredibly fast pace; on average, companies with under £5m turnover grew by more than 200% within the first year of their IPO.
4 Well-Known AIM Companies
ASOS is one of the UK’s biggest online fashion retailers, and has developed a global presence. Investors fortunate enough to purchase ASOS stocks at its IPO in August 2008 have seen the value of their holdings increase almost 1000% as of the end of June 2015. ASOS is currently the largest company in AIM, with a market cap of over £3bn. Company revenues in 2014 were £975.5m.
Dominos Pizza Group
Dominos Pizza Group is a pizza delivery company operating in four different countries, including the UK, where it does the vast majority of its business and has 813 stores here. It also operates in the Republic of Ireland (48 stores), Germany (22 stores) and Switzerland (11 stores). The company had its IPO in April 2007, and shareholders who invested then have seen the value of their shares increase by over 200%, as of the end of June 2015. Company revenues in 2014 were £766.6m.
Majestic Wine is primarily involved in the retailing of wine, beers and spirits. The company has an international presence, with 330 stores worldwide, and also has a very strong presence in the UK. The company had its IPO in August 2008, with shareholders who invested then seeing the share value grow by almost 95%. Company revenues in 2014 were £278.2m.
YouGov is a market research company based in the UK, but with an international presence, also operating in the USA, Middle East, Germany, France and the Nordics. It’s research and data products cover a number of areas, and one of its high-profile products is BrandIndex, which gives clients insight into how the mass market is feeling about brands. The company’s IPO was in April 2005, and since then the share value has increased by almost 275% (as of the end of June).
‘Financial’ companies make up the largest sector by market cap on AIM, followed by ‘Industrials’ and ‘Consumer Services’. ‘Technology’ is the fourth largest sector on AIM; tech companies listed there have a combined market capitalisation of £8.012bn. To tempt more rapid-growth players onto the market, LSE created a “high growth segment” a couple of years ago, but there have only been a couple of tech companies which have joined this segment. One of these companies was Just Eat, the well-known online platform connecting takeaways to their customers, and allowing them to pay online or through their mobiles. The company’s group revenue in the 2014 financial year was £67.4m.
Chief Executive of AIM Marcus Stuttard said that AIM continues to be a “proving ground” for smaller businesses, although he emphasised that they intend to keep a variety of companies on there, and aren’t pressurising the larger ones to upgrade to the FTSE 100. “If we’ve got a company that’s growing on Aim we don’t want to penalise them by forcing them onto the main market.”
Findings in the latest report on AIM companies claim that there is a correlation between the location of listed companies and the number of patents filed, meaning many companies listed on AIM are likely taking advantage of the Patent Box Regime, allowing businesses to pay a reduced rate of corporation tax on profits made on their patented products. The scheme is potentially available to any company that is profiting from patents it holds.
How we can help
Kingly Brookes works with a range of technology companies, from fast-growing startups to multinational organisations. As well as providing a full range of accounting and tax compliance and advice our specialisms include assisting companies to make the most of the tax reliefs for R&D and the Patent Box. In the last two years alone, our partner John Moore has helped his clients claim back in excess of £45m in R&D tax relief. To find out more about how we can help please email John.Moore@kinglybrookesllp.co.uk or call us on 0207 292 8850.