Frenkel Topping delivers record revenue and FUM growth amid ongoing takeover offer

Ascencia Investment Management also picked up Defaqto’s Defensive Comparator Sector award and was highly commended for three other investment solutions. Awards do not pay the bills on their own, but in a specialist market they can help with credibility and introducer relationships.

The company also said Ascencia’s key investment solutions outperformed benchmarks in Q1 2026. That is useful context because strong relative performance can help keep existing clients on board and support new business wins.

Revenue growth was broad, but the quality of that growth looks better than the headline alone

Total revenue increased to £41.7 million, with both recurring and non-recurring income moving higher. Non-recurring revenue rose 8% to £25.8 million, helped by an increase in medico-legal expert witnesses, which management says is a key future growth driver.

This matters because Frenkel Topping is not a one-trick pony. The group operates across financial services, costs law and other professional services tied to the personal injury and clinical negligence market, so it has multiple ways to feed clients into the wider group.

From the segmental split, Financial Services revenue rose to £16.8 million, Costs Law reached £10.3 million and Other Professional Services came in at £14.5 million. That spread gives the business some resilience, even if one area hits a bump.

Adjusted EBITDA, profit before tax and cash flow all improved – that is the good news investors like

Adjusted EBITDA, a profit measure that strips out certain items such as acquisition-related costs and share-based compensation, increased to £9.0 million from £8.0 million. Profit before tax rose more sharply, up 24% to £5.2 million.

Better still, operating cash flow had a very strong year. Cash generated from operating activities jumped to £4.9 million from £2.0 million, while pre-tax cash generated from operations increased to £6.5 million from £3.4 million.

That is important because profit growth is nice, but cash is what pays dividends, funds acquisitions and reduces debt. On that front, Frenkel Topping reduced net debt to £3.4 million from £3.8 million, which is modest progress in the right direction.

What was less impressive in the Frenkel Topping final results

Not everything was spotless. Basic EPS was flat at 2.3p and adjusted basic EPS was also unchanged at 3.9p, so per-share earnings did not move despite the rise in profit before tax.

The Costs segment also had a difficult year. Management said the Legal Aid Agency cyber security incident directly affected the number of new instructions received, and court delays continue to hurt cash conversion and debtor days in parts of the business.

There was also a heavier tax charge. Income tax expense increased to £2.2 million from £1.1 million, including £0.3 million relating to repayments to HMRC around historic returns. That does not break the story, but it does help explain why bottom-line growth was less dramatic than the profit before tax line might suggest.

Frenkel Topping dividend and Irwell Bidco takeover timetable explained

The board declared an interim dividend of 0.5p per share for FY25, payable on 8 July 2026 to shareholders on the register at the close on 26 June 2026. The ex-dividend date is 25 June 2026.

The really important bit is this: Irwell Bidco has confirmed it will waive its right to reduce the takeover consideration by the aggregate amount of this dividend. In plain English, shareholders are not being asked to fund their own dividend through a lower bid price, which is clearly a positive detail.

The takeover timetable now looks quite advanced. The FCA condition has been satisfied, the Court Hearing is scheduled for 6 July 2026 and, if approved, the Scheme is expected to become effective on 8 July 2026, with AIM cancellation expected at 7.00am on 9 July 2026.

What this Frenkel Topping RNS means for investors now

On the underlying business, this is a good update. The company delivered record revenue, record FUM, stronger recurring income and much better operating cash flow, while keeping client retention at an excellent 99%.

The weak spots are manageable rather than alarming. Court delays, the Legal Aid Agency cyber incident fallout and a chunky tax charge are not ideal, but they do not overturn the broader picture of a business still growing and generating more cash.

The bigger issue for shareholders is that the investment case is now heavily tied to the takeover process. With the offer already approved by shareholders and key conditions ticking off, the market focus is likely to be less about whether FY26 can beat FY25 and more about whether the Scheme completes on schedule.

My take is fairly simple. If you strip out the corporate activity, these are credible, healthy results from a specialist business with sticky clients and improving recurring revenue. If you keep the corporate activity in view, this RNS mostly serves as a reminder that Frenkel Topping is heading into the final leg of its sale process from a position of operational strength.