TIDMTHW
Chairman's Statement
The Company has benefited in this past year from the major investment programme
that we embarked upon in 2016 and which has continued throughout the course of
this last year. This has allowed us to continue to grow whilst dealing with
some significant challenges to our cost base.
Turnover for the year was GBP92.2m (2017: GBP84.4), an increase of 9.2%.
Operating profit has increased by GBP0.8m or 6.6% on last year to GBP12.9m
(2017: GBP12.1m). Earnings per share increased by 79% to 13.8p (2017: 7.7p).
During the year we have continued our strategy of investing in our core pub
estate, inns and hotels, whilst continuing to sell poorer quality properties,
repositioning our estate into assets that are fit for the future. Last year we
reported that we were embarking on a major investment programme, and this has
been a key focus of the year, with many of those projects now nearing
completion. In addition we have acquired a new hotel in the Lake District. As a
result of that net debt increased in the year from GBP47.6m at 31 March 2017 to
GBP63.7m at 31 March 2018.
Strategy
The strategy of the Company is to own and operate freehold properties and offer
superb hospitality in outstanding properties in great locations. Our business
is diverse and operates in several different markets and we believe that this
diversity provides some resilience over the course of the business cycle.
Pubs & Inns
Pubs - We own and support an estate of high quality tenanted pubs, run by
dedicated and talented individuals, who are attracted by the support package
and investment that we offer to help them to realise their pub's potential.
Investment into our pubs is focused on creating sustainable, long term
businesses with multiple income streams and strong food offerings. Where there
is the potential and the demand we invest in letting bedrooms for our pubs to
create an additional income stream to their restaurant and drinks businesses.
Brewery - Great beer is an important part of our heritage and customer offer.
We are committed to continuing to brew fabulous beers and distribute them
exclusively in our own properties. Our new brewery in Mellor Brook is nearing
completion and we will start to brew interesting craft beers there as well as
giving our customers the traditional ales that Thwaites is famous for.
Inns - We have a small but growing number of high quality inns that each have
their own identity and support local suppliers. Our inns showcase our own
beers, offer fantastic local food and comfortable rooms. We will acquire and
develop these larger managed properties which ideally will have bedrooms as
well as an excellent and exciting food and drink offering.
Hotels
Hotels & Spas - Our collection of provincial hotels are individual in nature,
but united in their conviviality, which allows our customers to feel
comfortable and at home. We maintain our hotels in good order, provide high
levels of service to our guests and a warm welcome. We are looking to add to
the number of hotels that we own through acquisition and new build.
Awards
In the past few years we have placed much emphasis on the recruitment and
retention of great team members who can help our customers to feel welcome and
at home. As a result we have been working on developing and enhancing our
employee proposition. One element of this has been our move away, last year,
from being a national minimum wage employer. However developing new training
and development programmes, together with increased focus on employee
engagement, has also been important.
I am delighted that our People and Development Team was rewarded by being named
as HR Team of the Year in the HR Distinction Awards. This was followed up by us
being named in the Sunday Times Best Company to Work For in Yorkshire and
Gloucestershire
New Offices and Brewery
We have been on site for much of the year building our new offices, brewery and
stables in Mellor Brook and our plans to relocate from Blackburn are well
advanced. We expect that the site will be handed back to us in July and that we
will move in August.
Once we move to Mellor Brook, our old brewery site, much of which is derelict
and in an increasing state of decay, will be demolished. This will have the
benefit of removing the significant rates liability associated with it whilst
plans for its redevelopment or sale are finalised. Whilst this may take some
time and requires supplementary regeneration within Blackburn town centre we
are resolved to wait until such time as we can extract full value from our land
holdings in the town.
Acquisitions, developments and disposals
Last year's developments at The Crown at Pooley Bridge, the Royal at Heysham,
the Boot and Shoe, Lancaster and the Lister Barn, Malham have all provided a
full contribution in the current year. Inevitably there have been a few
teething problems as we have relaunched these businesses. Of particular
challenge, has been the recruitment and training of several new teams at the
same time, however the properties all show excellent promise for the future.
In March 2017 we acquired Middleton's Hotel in York, a 56 bedroom property
spread over six Grade II-listed buildings. We have undertaken some small works
to improve the property, with more to come in this current year. I am pleased
to say that the hotel has been fully integrated and is performing ahead of
expectations.
In April 2017 we acquired Langdale Chase Hotel, on the banks of Lake
Windermere, which has 29 bedrooms. We have plans to refurbish the main property
and are considering the addition of a spa and further bedrooms. Our initial
discussions with the planners have been positive and we believe that works will
start during the course of this year.
In August 2017 we completed the Lodge at Solent, a new 54 bedroom lodge
adjoining the Parsons Collar pub in Fareham, adjacent to the Solent Hotel &
Spa. The Lodge got off to a strong start, followed by a slightly slower winter,
however we are confident in its prospects and will benefit from a full year's
contribution in the current year.
The major redevelopment of the Beverley Arms in the East Riding of Yorkshire
has been ongoing all year. Work started in June 2017 and whilst we had hoped to
be open in April 2018 it is likely that the property will now open in July. We
have started the recruitment and training of the new team and once open the
property will be an exciting new addition to our Inns.
During the year we have sold 17 pubs from the bottom end of our estate.
Dividend
An interim dividend of 1.10p (2017: 1.10p) was paid in January 2018 and the
Board recommends a final dividend of 3.36p (2017: 3.36p). The Board will keep
the level of dividend under review, and assess the level of future dividends in
light of company performance.
Board
There have been no changes to the Board during the course of the year.
People
I have often said in my report that we are lucky to have within the Company
fantastic teams of people without whom we could not be the successful business
that we are. Our strong family values and progressive attitude, demonstrated
this year by some of the awards that we have won, continue to attract wonderful
people and exciting new talent to the company.
In the second half of the year we initiated a project to look at how we run our
hotels, questioning from the bottom up our team and management structures.
These have not changed for many years, and whilst the structure has served us
well in the past, the nature and mix of our hotel business has changed.
In March 2018 we undertook a full restructuring of our hotel operations,
putting in place a new, more focused and dynamic operational structure which we
believe will serve the business better for the future. Inevitably this led to
some uncertainty, however I am pleased that the changes are now largely
complete.
I would like to thank all our staff, customers, suppliers and shareholders for
their support over the past year and wish everyone well for the year ahead.
Outlook
The weather throughout the Spring and into April has been some of the worst
that I can remember, and this has had an inevitable impact across all areas of
the business, meaning that we have got off to a slightly slower start than we
would have liked.
The coming year presents some uncertainties, particularly in our negotiations
with the European Union over Brexit and the influence that outcome will have on
our exchange rate, interest rates and economic growth. However our business is
in good health, its assets are well invested, we are making good progress
against our strategic objectives and we are well placed to weather any
volatility that may present itself.
The significant investments that we have completed this year, together with the
full year effect of those completed last year give us cause for confidence, and
I am hopeful that we will once more make progress in the year to come.
Mrs Ann Yerburgh
Chairman
12 June 2018
Operating Review
Overview
The beginning of the year started with considerable concerns about food and
wage inflation, which threatened many areas of the cost base. At the same time
consumer spending has been fickle, with a number of the major industry
participants choosing to discount, particularly in the casual dining market and
at the value end of the pub market. As a result the ability to pass cost
increases on in full has been a challenge and in some areas of the business
operating margins have been under pressure.
Sales have increased by 9%, and on a like for like basis, excluding
acquisitions, they increased by 2.5%. Continued refurbishments, particularly in
the hotels have been an important factor in supporting this growth. Despite
pressure on food and labour margins EBITDA has increased to GBP20.2m (2017:
GBP18.9m) an increase of 7.0%, group operating profit has increased to GBP12.9m
(2017: GBP12.1m).
We have continued to place a significant emphasis on how we attract, recruit,
train, develop and retain the best teams possible to run and support our
various operations. We have put in place a new training and development at
local level across all of our properties and have continued to undertake annual
engagement surveys across the business. The shortage of available employees in
the hospitality industry is becoming more acute, as has been predicted over the
past few years, and it is our aim to be the employer of choice in all our local
markets. It was very pleasing therefore to be named in the Sunday Times
Regional Best Companies to Work For in Yorkshire and Gloucestershire and we are
working towards a national listing.
We took the decision at the half year to refresh our websites once more, an
operation that seems to be becoming an ongoing event every two to three years.
This project is currently underway and will be completed at the start of the
summer, with a relaunch in July. In part this has allowed us to consider how we
market our bedroom stock, with the objective of slowing the seemingly
inexorable rise in commissions payable to online booking agents. This cost
which has been rising at an alarming rate in recent years as the market moves
towards single platform providers at the expense of the owners and operators of
the underlying hotels.
Our strategy remains focused on our pubs, inns and hotels and we have plans to
continue to invest in them to secure our future growth.
Pubs
We own a freehold estate of approximately 240 tenanted pubs, having sold 17
pubs in the year. Our pub estate encompasses community locals to destination
food led pubs in both rural and town centre locations, ranging geographically
from Cumbria to the Midlands, and from North Wales to Yorkshire.
Our strategy has been consistent in recent years, focusing on the quality pubs
within the estate, investing in them alongside proven operators to expand and
improve the premises. We have focused on establishing good quality food
offerings and where possible the development and refurbishment of bedrooms. Our
strategy has been wholly focused on creating an estate of high quality,
sustainable, growth businesses with several income streams. Tenanted pub
businesses are by nature diversified, with resilient earnings and when well
invested, with dedicated operators operating profitable businesses, they should
suffer from low levels of disruption from tenant churn and profits achieved
should convert to high levels of cash generation.
Our trading started the first half of the year steadily, and by the half year
we were broadly level year on year. Despite disposing of 17 more poorly
performing pubs during the year this trend held up and has resulted in full
year operating profits being almost exactly the same as last year. The mix of
sales in our pubs continues to change with beer volumes declining in line with
the market at about 4-5%, in favour of wines, spirits and soft drinks. Average
EBITDA per pub increased during the year by 5%.
For the past ten years we have participated in the annual MCA Tenant Track
Survey - which is an independent survey benchmarking the performance of our
tenanted pub business against our peers. The survey places particular focus on
our reputation and ethics, what we are like to deal with, the quality of the
support that we offer, how we maintain and repair our properties and how we
recruit and train new tenants as they become partners with us. We were pleased
that this year we were once again ranked third in the top 13 UK tenanted pub
companies posting an improved score to the previous year. During the year we
did however see an increase in tenant churn which meant that at the year end
there were 14 pubs (5% of the estate) which were looking for new tenants
compared to four last year, a position which has since improved.
During the year we completed 25 development projects at a cost of GBP2.3m,
continuing to make returns ahead of our hurdle rate of 20%. Major projects in
the year have been completed at the Cock and Bottle in Tarleton, The Lindley
Tap in Lindley and the Red Lion Stockton Heath - all of which have been
successfully relaunched.
Last year we decided to trial some new managed pub concepts in pubs where the
level of investment required meant that it was difficult to attract a third
party operator. The first of these, the Grill and Grain at Hoghton, suffered a
total loss from fire in April 2017. We have recouped our investment from our
insurers following the year end and for the time being we have placed the
redevelopment of the pub on hold whilst we focus on other projects.
We did not find any suitable pubs to acquire in the year, however we continue
to look to add into our business good quality tenanted pubs with balanced
income streams that we can either absorb into our existing tenanted estate or
make significant investment to reposition as a managed operation.
Brewery
We continue to operate our small craft brewery in Blackburn and will move it in
the next few months to our new site at Mellor Brook. The new brewery will allow
us to continue to produce a range of seasonal and craft beers exclusively for
sale in our own pubs, inns and hotels. We believe that this gives us a point of
difference over other pub owning companies.
Inns
We own and manage a small portfolio of 'Inns of Character' and continue to seek
high quality properties in outstanding locations to develop this collection.
Our Inns have a busy bar at the hub, a home cooked food offering and high
quality, comfortable accommodation - they focus on providing outstanding
hospitality and offer an attractive and more personal alternative to the
mid-market branded chains.
Our Inns have continued to grow, with sales in the current year increasing to
GBP16.1m (2017: GBP13.3m) an increase of 21%, operating profits have increased
by a comparable amount.
In the current year the Inns have benefited from a full year contribution from
The Lister Barn and a part year contribution from The Crown at Pooley Bridge,
which opened in May 2017.
In February 2016 we acquired the Beverley Arms in East Yorkshire. This property
has been closed since acquisition and has been with our builders since June
2017. During the course of building works we have seen delays caused by
problems to the groundworks and issues with asbestos. This will be a large and
exciting addition to our inns, with 38 bedrooms, a bar and a restaurant, it is
now due to open in July 2018.
We continue to look for new opportunities to grow our Inns portfolio and will
make further acquisitions where we believe we can add value.
Hotels & Spas
We own and operate ten hotels which are geographically spread across the north
and south of England. Our hotels are positioned towards the premium end of the
market and most have leisure and spa facilities. They are all different, and we
wish to develop them to promote the individual character of each hotel
supported by a great food and drink offering with local nuances. Our vision,
similar to our Inns, is to create a collection of interesting, characterful
contemporary hotels that are the best in their local area.
The provincial hotel market continued to grow over the year and saw further
increases in bedroom stock being added to the market. During the year our
hotels grew their sales by 13%. Much of this increase reflects the acquisitions
of Middleton's in York in February 2017 and Langdale Chase on Lake Windermere
in April 2017 together with the opening of The Lodge at Solent in August 2017.
Trading at our other hotels has been the subject of some disruption as a result
of the accelerated refurbishment programme that we disclosed in last year's
report. During the year we have refurbished 67 bedrooms as well as the
restaurant areas at Aztec, North Lakes and The Solent and the Spa and Pool
Halls at Kettering and Cottons. As these project come to an end we will see the
benefit of both undisturbed trading together with the anticipated returns on
the investments that we have made. Despite this disruption occupancy increased
by 4% year on year and our room rates net of commissions were broadly flat. As
a result of this and other cost savings operating profit from our hotels
increased in the year by 10%.
Last year, in response to the costly impact of the National Living Wage, we
undertook a review of the whole of our hotel operations, seeking to redesign
our operational structure to become more efficient. This project was completed
at the year end and we hope that it will bring benefits in the current year.
Summary and outlook
Once again the last year has been an extremely busy one, with continuing
investment in a good number of large and high quality investment schemes. We
are working hard to settle in our new investments and are pleased with the
early results from them. The successful launch of the Beverley Arms will be a
significant part of our growth this coming year and the recruitment and
training of the new team there has our full attention.
Our priority this year will be to cement the performance of the investment
projects delivered last year, of which there are a good number, and to make a
success of the new operational and management structure in our hotels. The
delivery of our new website will give us a better opportunity to market our
hotels directly to our guests, rather than through third parties. We also look
forward to finalising our plans for the development of Langdale Chase. The
business has good momentum and in the absence of any shocks we expect to make
continued progress.
We will be highly selective in making any further acquisitions, but should the
opportunities present themselves we will seek to acquire additional outstanding
properties in great locations to grow the business for the future.
Financial Review
Results
Turnover for the year ended 31 March 2018 increased by 9% to GBP92.2m (2017:
GBP84.4m). Operating profit increased by 7% to GBP12.9m (2017: GBP12.1m).
The measurement of the interest rate swaps at fair value resulted in a profit
of GBP1.3m (2017: a loss of GBP2.6m).
Profit before taxation for the year increased by 72% to GBP9.8m (2017:
GBP5.7m).
Business Review
The key issues facing the Group are covered in the Chairman's Statement and
Strategic Report. The KPI's used by the Group to monitor its overall financial
position can be summarised as follows:
2018 2017
Group GBP'm GBP'm
Turnover 92.2 84.4
EBITDA 20.2 18.9
Depreciation 7.3 6.8
Operating profit 12.9 12.1
Profit before tax 9.8 5.7
Net debt 63.7 47.6
Earnings per share (pence) 13.8 7.7
Pubs and Inns
GBP'm GBP'm
Turnover 48.6 45.7
EBITDA 16.5 15.9
Depreciation 3.8 3.6
Operating profit (before Group central charges) 12.7 12.3
Average number
Tenanted 255 265
Managed 11 10
Hotels & Spas
GBP'm GBP'm
Turnover 43.6 38.7
EBITDA 11.1 10.0
Depreciation 3.2 2.8
Operating profit (before Group central charges) 7.9 7.2
Average number
Hotels 8 6
Lodges 2 1
The principal non-financial indicators monitored by management are:
Pubs and Inns
Utility indices, beer quality, room occupancy rates, customer complaints,
health and safety incidents, beer volumes and tenant recruitment.
Hotels
Room occupancy rates, customer complaints, health and safety incidents, spa
memberships and wedding and event numbers.
Interest rate swaps measured at fair value
The Group has interest rate swaps for GBP55m which are recognised as a
financial liability. During the year ended 31 March 2018 the movement in the
fair value of the interest rate swaps resulted in a credit to the profit and
loss account of GBP1.3m (2017: a charge of GBP2.6m)
Interest payable
Net interest payable was GBP3.5m (2017: GBP3.0m) as loan capital increased from
GBP50m at the start of the year to GBP66.5m at the end of the year.
Taxation
The tax charge on profit for the year was GBP1.7m, an effective rate of 17.3%.
Earnings per share
The earnings per share was 13.8p (2017: 7.7p).
Dividends
An interim dividend of 1.10p has been paid and the Board recommends a final
dividend of 3.36p, which will make a total of 4.46p for 2018 (2017: 4.46p).
Cash flow and financing
The Group's net borrowing increased by GBP16.1m, from GBP47.6m at 31 March 2017
to GBP63.7m at 31 March 2018 due to capital expenditure.
The Group made deficit contributions to the defined benefit pension schemes of
GBP2.2m (2017: GBP2.2m). Whilst these schemes were closed in August 2009, the
Group is committed to funding the deficit on the scheme which was GBP34.9m,
before tax, at 31 March 2018, an increase of GBP4.2m from GBP39.1m at 31 March
2017.
The Group has GBP45m of long term debt, GBP21.5m of bank loans and cash
balances of GBP2.8m at 31 March 2018. The Group has three year bank facilities
of GBP30m. of which GBP8.5m is undrawn at 31 March 2018, these facilities are
sufficient to meet the requirements of the Group's capital investment plans.
Property
During the year we sold 17 pubs and four ancillary properties for a total of
GBP3.2m generating a profit against book value, after disposal costs, of
GBP0.1m.
In line with our accounting policy, 20% of our properties were subject to a
formal revaluation, and additionally an impairment review was carried out on
the rest of our property estate. This resulted in no overall change to the
total value of our property portfolio.
Treasury policy and financial risk management
Treasury policies are subject to Board approval. All borrowings are in sterling
and comprise a mixture of fixed interest loans and facilities carrying LIBOR
related floating rates. The Group has interest rate swaps for GBP55m where it
is committed to pay the difference between LIBOR and fixed interest rates. At
31 March 2018 a financial liability of GBP18.3m has been recognised in respect
of these interest rate swap contracts.
Kevin Wood
Finance Director
12 June 2018
EXTRACT FROM AUDITED FULL FINANCIAL STATEMENTS FOR THE YEARED
31 MARCH 2018
GROUP PROFIT AND LOSS ACCOUNT
2018 2017
GBP'm GBP'm
Total Total
Turnover 92.2 84.4
Cost of sales (68.1) (62.1)
Gross profit 24.1 22.3
Distribution costs (3.7) (3.2)
Administrative expenses (7.5) (7.0)
Operating profit 12.9 12.1
Property disposals 0.1 0.3
Profit before interest 13.0 12.4
Net interest payable (3.5) (3.0)
Profit (loss) on interest rate 1.3 (2.6)
swaps measured at fair value
Finance charge on pension (1.0) (1.1)
liability
Profit on ordinary activities 9.8 5.7
before taxation
Taxation on profit for the (1.7) (1.2)
year
Profit on ordinary activities 8.1 4.5
after taxation
Dividends : 2018 2017
Ordinary paid per share 1.10p (2017 - 1.10p) 0.6 0.6
Ordinary recommended per 25p share 3.36p (2017 - 2.0 2.0
3.36p)
Earnings per ordinary share 13.8p 7.7p
The final dividend of 3.36p per ordinary share in respect of the year ended 31
March 2018 will be paid on 17 July 2018 to shareholders on the register at 22
June 2018.
DANIEL THWAITES PLC
GROUP BALANCE SHEET
At 31 March 2018 2018 2017
GBP'm GBP'm
___________________________________________ ________ ________
Fixed Assets
Tangible assets 289.5 270.9
Investments 3.1 3.2
__________________________________________ ________ ________
292.6 274.1
Current assets
Stocks 0.6 0.6
Trade and other debtors 12.6 12.1
Cash at bank and in hand 2.8 2.4
__________________________________________ ________ ________
16.0 15.1
Creditors due within one year
Trade and other creditors (14.7) (12.1)
Net current assets 1.3 3.0
_______________________________________ ________ ________
Total assets less current liabilities 293.9 277.1
Creditors due after one year (84.8) (71.8)
_______________________________________ ________ ________
Net assets excluding pension liability 209.1 205.3
________________________________________ ________ ________
Pension liability (34.9) (39.1)
_____________________________________________ ________ ________
Net assets 174.2 166.2
_______________________________________ ________ ________
Capital and reserves
Called up share capital 14.7 14.7
Capital redemption reserve 1.1 1.1
Revaluation reserve 77.5 78.5
Profit and loss account 80.9 71.9
_______________________________________________ ________ ________
Equity shareholders' funds 174.2 166.2
_________________________________________ ________ ________
DANIEL THWAITES PLC
GROUP CASH FLOW STATEMENT
For the year ended 31 March 2018
2018 2017
GBP'm GBP'm
______________________________________________ ________ _________
Cash flow from operating activities 19.5 15.0
Tax paid / refunded (0.1) 0.1
Cash flow from financing activities 10.9 -
Cash flow from investing activities (27.3) (21.0)
Equity dividends paid (2.6) (2.6)
___________________________________________ ________ ________
Increase (decrease) in cash and cash equivalents 0.4 (8.5)
Cash and cash equivalents at beginning of year 2.4 10.9
________________________________________________ ________ _________
Cash and cash equivalents at end of year 2.8 2.4
Loan capital (66.5) (50.0)
__________________________________________________ ________ _________
Net debt (63.7) (47.6)
Reconciliation of net cash flow to movement in net debt
Increase (decrease) in cash 0.4 (8.5)
Cash flow from increase in debt (16.5) (5.0)
__________________________________________________ ________ ________
(16.1) (13.5)
Net debt at beginning of year (47.6) (34.1)
_____________________________________________ ________ ________
Net debt at end of year (63.7) (47.6)
__________________________________________ ________ ________
Notice of Meeting
Notice is hereby given that the Annual General Meeting of the Company will be
held at The North Lakes Hotel and Spa, Ullswater Road, Penrith, Cumbria, CA11
8QT on Thursday 12 July 2018 at 12.00 noon for the transaction of the following
business:
Ordinary Business
To consider, and if thought fit, pass the following resolutions which will be
proposed as ordinary resolutions.
1. To receive and adopt the accounts for the year ended 31 March 2018 and
the reports of the directors and the auditor, to confirm the interim dividend
and to approve and declare a final dividend for the year ended 31 March 2018
2. To re-elect Mr RAJ Bailey as a director
3. To re-elect Mrs AJM Yerburgh as a director
4. To approve and confirm the remuneration of the directors for the year
ended 31 March 2018
5. To reappoint KPMG LLP as auditor and authorise the directors to determine
their remuneration
Special Business
To consider, and if thought fit, pass the following resolutions of which
resolutions 6 and 8 will be proposed as ordinary resolutions and resolution 7
as a special resolution.
6. THAT, for the purposes of section 551 of the Companies Act 2006 (the Act)
the directors of the Company be and are hereby generally and unconditionally
authorised to exercise all powers of the Company to allot equity securities
(within the meaning of section 560 of the Act) up to an amount equal to the
aggregate nominal amount of the authorised but unissued share capital of the
Company provided that this authority shall expire (unless previously renewed,
varied or revoked by the Company in general meeting) at the conclusion of the
next annual general meeting of the Company, save that the Company may before
such expiry make an offer or agreement which would or might require relevant
securities to be allotted after such expiry and the directors of the Company
may allot relevant securities in pursuance of such an offer or agreement as if
the authority conferred hereby had not expired.
This authority is in substitution for any and all authorities previously
conferred upon the directors for the purposes of section 551 of the Act,
without prejudice to any allotments made pursuant to the terms of such
authorities.
7. THAT, subject to the passing of resolution 6 above, the directors of the
Company be and are hereby empowered pursuant to section 570 of the Act to allot
equity securities (within the meaning of section 560 of the Act) pursuant to
the authority conferred by resolution 6 above as if section 561 of the Act did
not apply to any such allotment provided that the power conferred by this
resolution shall be limited to:
i. the allotment of equity securities for cash in connection with an issue or
offer of equity securities (including, without limitation, under a rights
issue, open offer or similar arrangement) to holders of equity securities in
proportion (as nearly as may be practicable) to their respective holdings of
equity securities subject only to such exclusions or other arrangements as the
directors of the Company may consider necessary or expedient to deal with
fractional entitlements or legal or practical problems under the laws of any
territory, or the requirements of any regulatory body or stock exchange in any
territory; and
ii. the allotment (otherwise than pursuant to resolution 7.1) of
equity securities for cash up to an aggregate nominal amount of GBP735,343.
The power conferred by this resolution 7 shall expire (unless previously
renewed, revoked or varied by the Company in general meeting), at such time as
the general authority conferred on the directors of the Company by resolution 6
above expires, except that the Company may at any time before such expiry make
any offer or agreement which would or might require equity securities to be
allotted after such expiry and the directors of the Company may allot equity
securities in pursuance of such an offer or agreement as if the authority
conferred hereby had not expired.
8. To authorise the Company generally and unconditionally to make market
purchases (within the meaning of section 693(4) of the Companies Act 2006) of
ordinary shares of 25 pence each in the capital of the Company provided that:
i. the maximum aggregate number of ordinary shares that may be purchased is
5,882,750. Representing 10% of the issued share capital of the Company;
ii. the minimum price (excluding expenses) which may be paid for
each ordinary share is 25 pence.
iii. the maximum price (excluding expenses) which may be paid for
each ordinary share is an amount equal to 105 per cent of the average of the
middle market quotations for an ordinary share of the Company (as derived from
the ICAP Securities & Derivatives (ISDX) website) for the five business days
immediately preceding the day on which the purchase is made; and
iv. unless previously renewed, varied or revoked, the authority
conferred by this resolution shall expire at the earlier of the conclusion of
the Company's next Annual General Meeting and the date which is six months from
the end of the Company's next financial year save that the Company may, before
the expiry of the authority granted by this resolution, enter into a contract
to purchase ordinary shares which will or may be executed wholly or partly
after the expiry of such authority.
NOTES
Resolution 6 - Authority to allot relevant securities
The Company requires the flexibility to allot shares from time to time. The
directors are limited as to the number of shares they can at any time allot
because allotment authority continues to be required under the Companies Act
2006 (the Act).
Accordingly, resolution 6 would grant this authority (until the next Annual
General Meeting or unless such authority is revoked or renewed prior to such
time) by authorising the directors (pursuant to section 551 of the Act) to
allot relevant securities up to an amount equal to the aggregate nominal amount
of the authorised but unissued share capital of the Company as at 31 March
2018. The directors believe it to be in the interests of the Company for the
Board to be granted this authority, to enable the Board to take advantage of
appropriate opportunities which may arise in the future.
Resolution 7 - Disapplication of statutory pre-emption rights
This resolution seeks to disapply the pre-emption rights provisions of section
561 of the Act in respect of the allotment of equity securities for cash
pursuant to rights issues and other pre-emptive issues, and in respect of other
issues of equity securities for cash up to an aggregate nominal value of
GBP735,343, being an amount equal to approximately 5 per cent of the current
issued share capital of the Company. If given, this power will expire at the
same time as the authority referred to in resolution 5. The directors consider
this power desirable due to the flexibility afforded by it.
Resolution 8 - Authority to make market purchases of shares
Resolution 8 seeks authority for the Company to make market purchases of its
own ordinary shares. If passed, the resolution gives authority for the Company
to purchase up to 5,882,750 of its ordinary shares, representing 10 per cent of
the Company's issued ordinary share capital.
Resolution 8 specifies the minimum and maximum prices which may be paid for any
ordinary shares purchased under this authority. The authority will expire at
the conclusion of the Company's next Annual General Meeting in 2019 or, if
earlier, the date which is six months from the end of the Company's financial
year which commenced on 1 April 2018.
Any shares purchased under this authority will be cancelled. As a member of the
Company entitled to attend and vote at the meeting convened by this notice you
are entitled to appoint another person as your proxy to exercise all or any of
your rights to attend and to speak and vote in your place at the meeting. Your
proxy need not be a member of the Company.
You may appoint more than one proxy in relation to the meeting convened by this
notice provided that each proxy is appointed to exercise the rights attached to
a different share or shares held by you. You may not appoint more than one
proxy to exercise rights attached to any one share.
By order of the Board Mrs S. I. Woodward, A.C.I.S.
Secretary
12 June 2018
END
(END) Dow Jones Newswires
June 12, 2018 04:00 ET (08:00 GMT)
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