TIDMCEPS
RNS Number : 6434Z
CEPS PLC
25 May 2021
CEPS PLC
('CEPS' OR THE 'COMPANY' OR THE 'GROUP')
FINAL RESULTS
The Board of CEPS is pleased to announce its final results for
the year ended 31 December 2020.
CHAIRMAN'S STATEMENT
We, the nation, CEPS, our colleagues, shareholders, customers
and suppliers have all come through, and are moving through, a very
difficult period.
I strongly believe that we should reflect on what has happened
in this past year and take strength from the resilience that has
been shown across all areas of British society and the economy. In
respect of CEPS, the 15 months since the first lockdown has given
us the time to evaluate our businesses and how we want them to
develop going forward.
Over the past year I have heard, on numerous occasions, the
management teams of various public companies saying that they had
chosen to use the period of the lockdown as an opportunity to
implement changes to their businesses. These developments had been
planned and were scheduled to take two to five years to carry out
but, given the extraordinary circumstances in 2020, they decided to
complete the changes in three to six months. Generally, these
changes are to make processes and systems more efficient and
automated and so require less labour, and to ultimately be more
cost effective and efficient.
Readers of my statements over recent years will be aware that,
contrarily, I have been very concerned about the availability of
skilled employees, now and in the future and, therefore, anything
that can be done to remove labour from our businesses is to be
encouraged.
Over the past 18 months the Board has made a number of
announcements setting out developments in each of the companies as
appropriate. None of these announcements were of themselves "earth
shattering", but collectively we feel that they will prove to be
transformational for the parent company. For the benefit of
shareholders, I set them out collectively again in abbreviated
form. We will not make a habit of this as I doubt if any single
year in the future, we will make so many changes requiring
announcements.
October 2019 Acquisition of Milano International by Signature
Fabrics, the parent company of Friedman's.
January 2020 Removal of the lossmaking CEM group of companies
by way of administration.
March 2020 Acquisition of Cook Brown Building Control and
Cook Brown Energy by Hickton Group and reorganisation
of the capital structure and modest increase in
CEPS' shareholding.
September 2020 Change of management, increase in CEPS' shareholding
and capital reconstruction of Aford Awards.
December 2020 Merger of Davies Odell and Vale Partners and revised
capital structure of the new holding company for
these.
Since the year
end:
March 2021 Acquisition of the Millington Lord group of companies
by Hickton Group.
It is the Board's firm belief that all of these corporate
changes listed above will, in time, prove to be highly beneficial
to the parent, CEPS.
Financial review
The financial year being reported on is something of a curate's
egg!
The accounts, as in the last few years, are completely distorted
by a few one-off factors and I am fully aware and acknowledge that
this has, unfortunately, been the mantra of the Board over the past
few years. It is to be hoped going forward that our accounts will
become less complex.
As already mentioned, in January 2020 CEM and Sampling
International went into administration, and in December 2020 CEPS'
ownership of Davies Odell moved from being a subsidiary to an
associate on its merger with Vale Brothers. Consequently, these
companies are classified as discontinued operations in 2020 and the
2019 comparatives. Those companies that are categorised as
continuing operations are Aford Awards, Friedman's and Milano
International, and Hickton Consultants, BRCS and the two Cook Brown
companies.
Total revenue for 2020 was GBP14.0m (2019: GBP21.8m) of which
GBP11.9m (2019: GBP12.5m) was generated from continuing operations
and GBP2.1m (2019: GBP9.3m) from discontinued operations.
Unsurprisingly, given that Aford Awards, Friedman's and Milano
International operate in the leisure sector, their results were
decimated by the effects of the pandemic. The segmental result
presented as EBITDA before exceptional items of GBP1.0m (2019:
GBP971,000) shows EBITDA of GBP1.2m (2019: GBP2.5m) from continuing
operations and a loss of GBP120,000 (2019: loss of GBP1.5m) from
discontinued operations.
Looking at the individual companies in more detail shows that
Aford Awards' EBITDA in the current year was GBP111,000 (2019:
GBP411,000) and the combined EBITDA of Friedman's and Milano
International in 2020 was GBP124,000 (2019: GBP1.2m). Despite the
fact that these results are so much lower than in the previous
year, the companies did extremely well to achieve a positive EBITDA
in such difficult circumstances.
Hickton Group, with the addition of the Cook Brown companies in
March 2020, fared much better due to its trading activities in the
construction sector. The Hickton Group's EBITDA in 2020 was
GBP929,000 compared to GBP850,000 in 2019. Although the 2020
results are better than those in 2019, the former include the
results for the Cook Brown companies for the nine months following
their acquisition. The performance of the expanded group would have
been higher had not Covid-19 had an impact.
The adjusted Group operating profit, before exceptional items
and the impairment of intangible assets, for the year was GBP12,000
(2019: adjusted operating loss of GBP38,000), split between an
operating profit from continuing operations of GBP229,000 (2019:
GBP1.7m) and an operating loss from discontinued operations of
GBP217,000 (2019: operating loss GBP1.8m).
Other operating income in the year of GBP861,000 (2019: GBPnil)
has derived from the Coronavirus Job Retention Scheme and other
similar grants and without this government support CEPS would have
made an operating loss, before exceptional items and the impairment
of intangible assets, of GBP849,000, split between continuing
operations (loss of GBP461,000) and discontinued operations (loss
of GBP388,000).
After due consideration and to err on the side of caution, the
remaining goodwill and customer list intangibles associated with
BRCS were impaired in the year resulting in a write-off of
GBP354,000.
Although CEM and Sampling International did not trade during the
year, there was an exceptional profit on their disposal of
GBP825,000, amended from the figure reported in the 2020 interims
of GBP2.6m as announced to the market on 20 April 2021. This profit
is analysed under discontinued operations and is reduced by the
loss on disposal of Davies Odell of GBP199,000, producing a net
profit on disposal of discontinued operations of GBP626,000.
Finance costs for the year of GBP762,000 are considerably higher
than last year (2019: GBP441,000) and are split between continuing
operations (GBP732,000) (2019: GBP340,000) and discontinued
operations (GBP30,000) (2019: GBP101,000). This can be explained by
the increased level of gearing which has increased from 156% in
2019 to 478% in 2020 with additional interest charges from the loan
note funding of both the acquisition and restructuring.
The loss before taxation for the year was GBP645,000 (2019:
GBP2.3m), GBP960,000 of which was the loss generated from
continuing operations (2019: profit of GBP1.4m) and GBP315,000 was
the profit from discontinued operations (2019: loss of
GBP3.7m).
Taxation for the year at GBP20,000 is much reduced from the
previous year's charge of GBP342,000 due to the impact that
Covid-19 had on the results of the companies that usually pay
corporation tax and including the carry back of losses to reclaim
2019 tax paid.
The loss for the year after taxation was GBP665,000 (2019:
GBP2.6m), split between a loss from continuing operations of
GBP980,000 (2019: profit of GBP1.1m) and a profit from discontinued
operations of GBP315,000 (2019: loss of GBP3.7m).
Loss per share on a basic and diluted basis was 3.67p (2019:
loss per share 15.86p) which can be analysed between a loss per
share from continuing operations of 5.52p (2019: earnings per share
of 2.20p) and an earnings per share from discontinued operations of
1.85p (2019: loss per share of 18.06p).
The cash generated from operations in 2020 was GBP1.5m which
compares to GBP365,000 in 2019. Net debt, excluding acquisition
loan notes, increased over the year from GBP4.3m to GBP5.2m. The
additional cash was primarily used to finance the new acquisitions
and the restructuring in the year.
During the 2020 financial year I have loaned the Company
GBP650,000 interest free and with no fixed repayment date. Since
the year end, I have loaned a further GBP100,000 on the same
terms.
Finally, in the Consolidated Statement of Changes in Equity
there is a charge of GBP957,000 which has resulted from the changes
in ownership interest in the subsidiaries, Aford Awards, Davies
Odell and Hickton Group, as listed in the corporate changes above.
This reflects current values and the accounting treatment of the
amounts consequently paid on the restructuring of continuing
subsidiaries, in particular for the changes within the minority
shareholdings in Hickton Consultants.
The directors consider that it is appropriate for the financial
statements to be prepared on a going concern basis due to the
additional funding of GBP2,000,000 from a new debt provider
(replacing an existing loan which is due to be repaid on 30 June
2021) in place post year end which provides confidence to the
directors that the Group will be able to operate within its current
funding facilities to 30 June 2022.
However, the lack of certainty over trading and the ability of
the subsidiaries to generate cash over the next 12 months created
by the continuing Coronavirus restrictions represents a material
uncertainty over going concern. No adjustments have been made to
the financial statements in respect of amounts should the going
concern basis not be appropriate. It should be noted that the
auditor's opinion is not modified in respect of this matter.
Although it has been an extremely difficult year for all the
Group companies, the management teams of each of the subsidiaries
have taken a long hard look at their operations and made changes,
sadly generally involving a reduction in the work force, leading to
improved efficiency and the creation of more dynamic operational
platforms.
It is the Board's belief that the underlying subsidiaries will,
to a greater or lesser extent, improve their performances over the
course of the second half of 2021 as the impact of lockdowns is
progressively reduced. However, given the continued impact in the
first half of 2021, it will not be until the 2022 financial year
that the real progress and new strength of the CEPS group will
become clear publicly.
Operational review
I will now report on the performance of the individual
companies.
Aford Awards
Trading was in line with expectations, which was an increase on
the previous year, until the first lockdown at the end of March
2020.
Since that date, the business has been working on a care and
maintenance basis. Staff have been furloughed and gradually brought
back into the business as required. The giving of trophies, medals
and awards is generally part of a public event which has, of
course, been banned for much of the past 15 months. However,
fortunately, organisations have tried to continue as normally as
possible, and the business has been gradually increasing its sales
for the past six months.
A new management team took over in September from Jon Ford who
is the son of the original founder, Andy Ford. This reorganisation
was effected by setting up a new holding company with CEPS
increasing its shareholding from 70% to 75% and receiving
additional loan notes.
The new team are committed, as is the Board of CEPS, that a
significant part of the future growth of Aford Awards will be
through the acquisition of very small, uneconomic lifestyle
businesses which can be absorbed and integrated into the existing
Aford Awards' structure. Discussions are under way with several
such opportunities, and we expect to report that some of these will
be acquired this year. These are generally very small and the
acquisition price will, in the main, be funded by Aford Awards from
its own resources, with no recourse to CEPS.
There is no doubt that the turmoil caused by the Covid-19
lockdowns has accelerated the potential for consolidation in the
sector. In addition, as these small companies have been surviving
on a remote basis for much of the past 15 months, they have
therefore "proved" that their businesses can be relocated with
little or no loss of sales.
Davies Odell
The most important event in the company's year was the merger
with Vale Brothers at the end of the financial year in December
2020.
Whilst more people were made redundant during the year, as the
management team continued to "right-size" the business, the losses
continued, albeit on a reduced basis.
The merger was achieved by a new holding company being
established to acquire Davies Odell and Vale Brothers, Vale
Brothers Group. CEPS has 33% of the equity of the new holding
company and GBP405,000 of loan stock.
Vale Brothers manufactures equestrian equipment including
saddles, bridles, horse whips, rugs and brushes. These products are
complementary to Davies Odell's range of personal protection
products sold under the Forcefield brand and matting for stables
sold as Equimat.
As a result of the merger there have been further reductions in
people employed and it is expected that these cost savings will
give the combined businesses an opportunity to generate
profits.
In addition, in time, further acquisitions and consolidation
will be carried out in these very traditional and fragmented
sectors.
Friedman's
The deep regret of 2020 was that the management team of the
company had spent the six months from the acquisition of Milano
International in October 2019 revamping, reorganising, and
redesigning the Milano product range and were poised to relaunch
the business in early April 2020. Clearly all of that has been put
on hold until such a time as gyms and dance studios can reopen.
In the meantime, whilst Friedman's core sales have declined
significantly, the Funki Fabrics business, after an initial
decline, has over time recovered to its pre-Covid-19 levels and
continued to be profitable.
The management team are poised to take advantage of all
opportunities once the restrictions are eased.
Hickton Group
The financial year of 2020 was another year of strong
development for the group.
In March 2020, a new holding company, Hickton Group, was set up
to buy Cook Brown Building Control and Cook Brown Energy and to
merge with the existing CEPS subsidiary Hickton Consultants.
Amongst the benefits of this amalgamation was a broadening of the
group's activities into other building services. As part of this
exercise, James Cook and Matthew Brown, the founders of Cook Brown,
received shares in Hickton Group and will work alongside Tony
Mobbs, Chairman of Hickton Group, and Janet Pryke, Finance
Director.
CEPS "rolled over" its entire investment into 54.7% of the
equity of the Hickton Group with a total of GBP2.24m of loan
stock.
Trading in the enlarged group has continued to be very positive
in 2020.
After the year end, on 15 March 2021, the Hickton Group acquired
the Millington Lord group of companies for a maximum consideration
of GBP1.1m. Millington Lord was owned by GT Realisations.
The Millington Lord group of companies is made up of Morgan
Lambert Limited, Qualitas Compliance Limited and Morgan Lambert
Electrical Limited. These companies make up a gas and electrical
safety consultancy involved in providing auditing, consultancy and
training services.
The Board remains very excited about the future development of
this specialist building services group.
Outlook
It is of course still difficult at this stage to write anything
about the outlook for the rest of this year. However, because of
the mass vaccination programme, the much greater understanding of
Covid-19 and the acknowledgement that Covid-19 is endemic, it is
possible to think of a gradual but definite return to a version of
"normal" over the balance of 2021.
It is the Board's very clear view that the survivors from the
last 15 months will prosper as they will have proved themselves to
be nimble, resourceful and resilient. We are certain that, because
of the extensive corporate activity of the past year involving our
companies and the extensive re-engineering of the businesses from
the "bottom up", they are all in a much better place.
David Horner
Chairman
24 May 2021
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 (which forms part of
domestic UK law pursuant to the European Union (Withdrawal) Act
2018).
David Horner, Chairman, CEPS PLC
Tel: 01225 483030
James Caithie, Cairn Financial Advisers LLP
Nominated Adviser
Tel: 020 7213 0880
CEPS PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
YEARED 31 DECEMBER 2020
Continuing Discontinued
Operations Operations
Audited Audited Audited
2020 2020 2020
GBP'000 GBP'000
Revenue (note 4) 11,861 2,091 13,952
Cost of sales (7,511) (1,817) (9,328)
------------ ------------- --------
Gross profit 4,350 274 4,624
Other operating income 690 171 861
Administration expenses before
exceptional items (4,811) (662) (5,473)
Adjusted operating profit/(loss) 229 (217) 12
Exceptional items (127) (64) (191)
Impairment of intangible assets
(note 10) (354) - (354)
Operating loss (252) (281) (533)
Analysis of operating loss
------------ ------------- --------
- Trading 659 (217) 442
- Exceptional items (127) (64) (191)
- Impairment of intangible assets (354) - (354)
- Group costs (430) - (430)
------------ ------------- --------
(252) (281) (533)
-------------------------------------- ------------ ------------- --------
Profit on disposal of discontinued
operations - 626 626
Finance income 24 - 24
Finance costs (732) (30) (762)
--------
(Loss)/profit before tax (960) 315 (645)
Taxation (note 5) (20) - (20)
------------ ------------- --------
(Loss)/profit for the financial
year (980) 315 (665)
------------ ------------- --------
Other comprehensive loss:
Items that will not be reclassified
to profit or loss
Actuarial loss on defined benefit
pension plans (13) - (13)
------------ ------------- --------
Other comprehensive loss for the
year, net of tax (13) - (13)
------------ --------
Total comprehensive (loss)/profit
for the financial year (993) 315 (678)
------------ ------------- --------
(Loss)/income attributable to:
Owners of the parent (939) 315 (624)
Non-controlling interests (41) - (41)
------------ ------------- --------
(980) 315 (665)
------------ ------------- --------
Total comprehensive (loss)/income
attributable to:
Owners of the parent (952) 315 (637)
Non-controlling interests (41) - (41)
------------ ------------- --------
(993) 315 (678)
------------ ------------- --------
Earnings per share
- basic and diluted (note 6) (5.52p) 1.85p (3.67p)
------------ ------------- --------
CEPS PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (PRIOR YEAR)
YEARED 31 DECEMBER 2020
Continuing Discontinued
Operations Operations
Audited Audited Audited
2019 2019 2019
GBP'000 GBP'000
Revenue (note 4) 12,501 9,252 21,753
Cost of sales (7,207) (8,381) (15,588)
------------ ------------- ---------
Gross profit 5,294 871 6,165
Administration expenses before
exceptional items (3,558) (2,645) (6,203)
Adjusted operating profit/(loss) 1,736 (1,774) (38)
Exceptional items - (1,836) (1,836)
Operating profit/(loss) 1,736 (3,610) (1,874)
Analysis of operating profit/(loss)
------------ ------------- ---------
- Trading 2,112 (1,774) 338
- Exceptional items - (1,836) (1,836)
- Group costs (376) - (376)
------------ ------------- ---------
1,736 (3,610) (1,874)
-------------------------------------- ------------ ------------- ---------
Finance income 28 - 28
Finance costs (340) (101) (441)
---------
Profit/(loss) before tax 1,424 (3,711) (2,287)
Taxation (note 5) (342) - (342)
------------ ------------- ---------
Profit/(loss) for the year 1,082 (3,711) (2,629)
------------ ------------- ---------
Other comprehensive loss:
Items that will not be reclassified
to profit or loss
Actuarial loss on defined benefit
pension plans (99) - (99)
------------ ------------- ---------
Other comprehensive loss for the
year, net of tax (99) - (99)
------------ ---------
Total comprehensive profit/(loss)
for the financial year 983 (3,711) (2,728)
------------ ------------- ---------
Income/(loss) attributable to:
Owners of the parent 375 (3,071) (2,696)
Non-controlling interests 707 (640) 67
------------ ------------- ---------
1,082 (3,711) (2,629)
------------ ------------- ---------
Total comprehensive income/(loss)
attributable to:
Owners of the parent 276 (3,071) (2,795)
Non-controlling interests 707 (640) 67
------------ ------------- ---------
983 (3,711) (2,728)
------------ ------------- ---------
Earnings per share
- basic and diluted (note 6) (2.20p) 18.06p (15.86p)
------------ ------------- ---------
CEPS PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2020
2020 2019
GBP'000 GBP'000
-------- --------
Assets
Non-current assets
Property, plant and equipment (note 7) 633 1,099
Right-of-use assets (note 8) 976 1,072
Intangible assets (note 10) 9,208 6,360
10,817 8,531
-------- --------
Current assets
Inventories 1,441 2,254
Trade and other receivables 1,883 3,366
Cash and cash equivalents (excluding bank overdrafts) 2,332 1,958
5,656 7,578
-------- --------
Total assets 16,473 16,109
======== ========
Equity
Capital and reserves attributable to owners
of the parent
Called up share capital (note 11) 1,700 1,700
Share premium (note 11) 5,841 5,841
Retained earnings (8,402) (6,808)
-------- --------
(861) 733
Non-controlling interests in equity 1,954 2,018
Total equity 1,093 2,751
-------- --------
Liabilities
Non-current liabilities
Borrowings 6,415 5,152
Lease liabilities 887 982
Deferred tax liability 51 109
7,353 6,243
-------- --------
Current liabilities
Borrowings 3,861 2,174
Lease liabilities 248 201
Trade and other payables 2,909 3,544
Current tax liabilities 1,009 1,196
8,027 7,115
-------- --------
Total liabilities 15,380 13,358
-------- --------
Total equity and liabilities 16,473 16,109
======== ========
The comprehensive income within the parent company financial
statements for the year was GBP1,343,000 (2019: loss of
GBP3,254,000).
CEPS PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
YEARED 31 DECEMBER 2020
2020 2019
GBP'000 GBP'000
Cash flows from operating activities
Loss for the financial year (665) (2,629)
Adjustments for:
Depreciation and amortisation 601 633
Profit on disposal of subsidiaries (626) -
Customer list impairment 182 -
Impairment of goodwill 172 395
Write-down of fixed assets - 229
Pension contributions less than administrative
charge 9 -
Net finance costs 738 413
Taxation charge 20 342
Changes in working capital:
Movement in inventories 375 172
Movement in trade and other receivables 325 928
Movement in trade and other payables 377 (118)
Cash generated from operations 1,508 365
Corporation tax paid (241) (341)
Net cash generated from operations 1,267 24
-------- --------
Cash flows from investing activities
Interest received 2 28
Acquisition of subsidiaries net of cash acquired (866) (1,790)
Acquisition in minority shareholdings in subsidiaries (1,366) -
Disposal of subsidiaries, net of cash (4) -
Purchase of property, plant and equipment (95) (241)
Proceeds from sale of assets 1 -
Purchase of intangibles assets (24) -
Net cash used in investing activities (2,352) (2,003)
-------- --------
Cash flows from financing activities
Proceeds from borrowings 3,174 2,885
Repayment of borrowings (904) -
Loan issue costs paid (86) -
Proceeds from subsidiary share issue 26 -
Interest paid (432) (310)
Lease liability payments (319) (343)
-------- --------
Net cash generated from financing activities 1,459 2,232
-------- --------
Net increase in cash and cash equivalents 374 253
Cash and cash equivalents at the beginning
of the year 1,958 1,705
-------- --------
Cash and cash equivalents at the end of the
year 2,332 1,958
-------- --------
CEPS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
YEARED 31 DECEMBER 2020
Attributable
to owners Non-controlling
Share Share Retained of the interest Total
capital premium earnings parent equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January 2019 1,700 5,841 (4,013) 3,528 1,932 5,460
---------- ---------- ----------- ------------- ------------------ ---------
Actuarial loss - - (99) (99) - (99)
(Loss)/profit for the
year - - (2,696) (2,696) 67 (2,629)
---------- ---------- ----------- ------------- ------------------ ---------
Total comprehensive
(loss)/income for the
year - - (2,795) (2,795) 67 (2,728)
---------- ---------- ----------- ------------- ------------------ ---------
Minority ownership interest
in a subsidiary - - - - 19 19
Acquisition of a subsidiary - - - - 19 19
---------- ---------- ----------- ------------- ------------------ ---------
At 31 December 2019 1,700 5,841 (6,808) 733 2,018 2,751
---------- ---------- ----------- ------------- ------------------ ---------
Actuarial loss - - (13) (13) - (13)
Loss for the year - - (624) (624) (41) (665)
---------- ---------- ----------- ------------- ------------------ ---------
Total comprehensive
loss for the financial
year - - (637) (637) (41) (678)
---------- ---------- ----------- ------------- ------------------ ---------
Changes in ownership
interest in subsidiaries - - (957) (957) (23) (980)
Total distributions
recognised directly
in equity - - (957) (957) (23) (980)
At 31 December 2020 1,700 5,841 (8,402) (861) 1,954 1,093
---------- ---------- ----------- ------------- ------------------ ---------
Share capital comprises the nominal value of shares subscribed
for.
Share premium represents the amount above nominal value received
for shares issued, less transaction costs.
Retained earnings comprise accumulated comprehensive income for
one year and prior periods attributable to the parent, less
dividends paid.
Non-controlling interest represents the element of retained
earnings which is not attributable to the owners of the parent.
Notes to the financial information
1. General information
The Company is a company incorporated and domiciled in England
and Wales. The Company is a public company limited by shares, which
is listed on the AIM market of the London Stock Exchange. The
address of the registered office is 11 Laura Place, Bath BA2
4BL.
The principal activities of the Company are that of an
industrial holding company, acquiring stakes in stable, profitable
and steadily growing entrepreneurial companies. The activities of
the Company's trading subsidiaries are described in note 4.
Segmental analysis is also given in note 4.
The financial statements are presented in British Pounds
Sterling (GBP), the currency of the primary economic environment in
which the Group's activities are operated and are reported in
GBP'000. The Group comprises the Company and its subsidiary
companies. The financial statements are to the year ended 31
December 2020 (2019: year ended 31 December 2019).
The registered number of the Company is 00507461.
The principal accounting policies applied in the preparation of
the consolidated financial statements are set out in the financial
statements. These policies have been consistently applied
throughout the year, unless otherwise stated.
2. Basis of preparation and going concern
This announcement is an extract from the consolidated financial
statements of the Company for the year ended 31 December 2020 and
comprises the Company and its subsidiaries. The consolidated
financial statements were authorised for issuance on 19 May 2021.
The financial information set out below does not constitute the
Company's statutory accounts for the years ended 31 December 2019
or 2020 within the meaning of Section 434 of the Companies Act
2006, but is derived from those accounts. Statutory accounts for
2019 have been delivered to the Registrar of Companies and those
for 2020 will be delivered following the Company's Annual General
Meeting. The auditor's reports on the statutory accounts for the
years ended 31 December 2019 and 31 December 2020 were unqualified
with reference to a material uncertainty in respect of going
concern due to the global Coronavirus pandemic, and do not contain
statements under s498(2) or (3) Companies Act 2006.
This financial information has been prepared on a going concern
basis under the historical cost convention in accordance with the
International Financial Reporting Standards as adopted by the
European Union ('IFRSs'), IFRIC interpretations and the Companies
Act 2006 as applicable to companies reporting under IFRS.
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of
applying the Group's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the consolidated
financial statements are disclosed in note 3.
Certain statements in this announcement constitute
forward-looking statements. Any statement in this announcement that
is not a statement of historical fact including, without
limitation, those regarding the Company's future expectations,
operations, financial performance, financial condition and business
is a forward-looking statement. Such forward-looking statements are
subject to risks and uncertainties that may cause actual results to
differ materially. These risks and uncertainties include, amongst
other factors, changing economic, financial, business or other
market conditions. These and other factors could adversely affect
the outcome and financial effects of the plans and events described
in this announcement and the Company undertakes no obligation to
update its view of such risks and uncertainties or to update the
forward-looking statements contained herein. Nothing in this
announcement should be construed as a profit forecast
The lack of certainty over trading and the ability of the
subsidiaries to generate cash over the next 12 months created by
the continuing Coronavirus restrictions represents a material
uncertainty over going concern. No adjustments have been made to
the financial statements in respect of amounts should the going
concern basis not be appropriate.
The financial information set out in this announcement was
approved by the Board on 24 May 2021.
3. Critical accounting assumptions, judgements and estimates
The directors make estimates and assumptions concerning the
future. They are also required to exercise judgement in the process
of applying the Company's accounting policies. Estimates and
judgements are continually evaluated and are based on historical
experience and other factors, including expectations of future
events that are believed to be reasonable under the
circumstances.
The estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are assessed below:
i) Impairment of intangible assets (including goodwill)
The Group tests annually whether intangible assets (including
goodwill) have suffered any impairment, in accordance with the
relevant accounting policy. The recoverable amounts of the
cash-generating units have been determined based on value-in-use
calculations. The calculations require the use of estimates (note
10).
ii) Impairment of non-current assets
The Company assesses the impairment of tangible fixed assets
subject to depreciation whenever events or changes in circumstances
indicate that the carrying value may not be recoverable. Factors
considered important that could trigger an impairment review
include the following:
-- significant underperformance relative to historical or projected future operating results;
-- significant changes in the manner of the use of the acquired
assets or the strategy for the overall business; and
-- significant negative industry or economic trends.
iii) Depreciation and residual values
The directors have reviewed the asset lives and associated
residual values of all fixed asset classes and have concluded that
asset lives and residual values are appropriate.
The actual lives of the assets and residual values are assessed
annually and may vary depending on a number of factors. In
re-assessing asset lives, factors such as technological innovation,
product life cycles and maintenance programmes are taken into
account. Residual value assessments consider issues such as future
market conditions, the remaining life of the asset and projects'
disposal values.
iv) Carrying value of stocks
Management reviews the market value of and demand for its stocks
on a periodic basis to ensure stock is recorded in the financial
statements at the lower of cost and net realisable value. Any
provision for impairment is recorded against the carrying value of
stocks. Management uses its knowledge of market conditions,
historical experiences and estimates of future events to assess
future demand for the Company's products and achievable selling
prices.
v) Recoverability of trade debtors
Trade and other debtors are recognised to the extent that they
are judged recoverable. Management reviews are performed to
estimate the level of reserves required for irrecoverable debt.
Provisions are made specifically against invoices where
recoverability is uncertain.
Management makes allowance for doubtful debts based on an
assessment of the recoverability of debtors. Allowances are applied
to debtors where events or changes in circumstances indicate that
the carrying amounts may not be recoverable. Management
specifically analyses historical bad debts, customer
creditworthiness, current economic trends and changes in customer
payment terms when making a judgement to evaluate the adequacy of
the provision for doubtful debts. Where the expectation is
different from the original estimate, such difference will impact
the carrying value of debtors and the charge in the Consolidated
Statement of Comprehensive Income.
vi) Leases
Where the Group has an option to extend or terminate a lease,
management uses its judgement to determine whether such an option
would be reasonably certain to be exercised. Management considers
all facts and circumstances, including past practice and costs that
would be incurred if an option were to be exercised, to help it
determine the lease term. Management has also applied judgements in
assessing the discount rate, which is based on the incremental
borrowing rate. Such judgements could impact lease terms and
associated lease liabilities. The Group has availed itself of the
practical expedient available on transition to IFRS 16 not to
reassess whether a contract is or contains a lease. Consequently,
the definition of a lease, in accordance with IAS 17 and the
guidance in IFRIC 4, will continue to be applied to those leases
entered into or modified before 1 January 2019.
vii) Retirement benefit liabilities
The Group operates a defined benefits pension scheme. The scheme
is subject to triennial actuarial valuation and the Group
commissions an independent qualified actuary to update to each
financial year end the previous triennial result. The results of
this update are included in the financial statements. In reaching
the annually updated results management makes assumptions and
estimates. These assumptions and estimates are made advisedly, but
are not any guarantee of the performance of the scheme or of the
outcome of each triennial review.
4. Segmental analysis
The Chief Operating Decision-Maker ('CODM') of the Group is its
Board. Each operating segment regularly reports its performance to
the Board which, based on those reports, allocates resources to and
assesses the performance of those operating segments.
The operating segments set out below are the only level for
which discrete information is available or utilised by the
CODM.
Operating segments and their principal activities are as
follows:
-- Aford Awards, a sports trophy and engraving company;
-- Friedman's, a convertor and distributor of specialist Lycra,
including Milano International (trading as Milano Pro-Sport), a
designer and manufacturer of leotards;
-- Hickton Group, comprising Hickton Consultants, BRCS and Cook
Brown, providers of services to the construction industry.
Discontinued operations represent the activities of Davies
Odell, a manufacturer and distributor of protection equipment,
matting and footwear components, until disposal in December 2020
and of the CEM Press companies including Travelfast (trading as
Sampling International), a manufacturer of fabric, carpet and
wallpaper pattern books, swatches and shade cards, until these went
into administration in January 2020.
Group costs, costs incurred at Head Office level to support the
activities of the Group.
The United Kingdom is the main country of operation from which
the Group derives its revenue and operating profit and is the
principal location of the assets and liabilities of the Group.
Group revenue is recognised at a point in time, other than
GBP2,674,000 in respect of Cook Brown Building Control (2019:
GBPnil) which is recognised over a period in time as the services
are performed, in line with the requirements of IFRS 15.
The Board assesses the performance of each operating segment by
a measure of adjusted earnings before interest, tax, Group costs,
depreciation and amortisation (EBITDA) before exceptional costs.
Other information provided to the Board is measured in a manner
consistent with that in the financial statements.
i) Results by segment
Aford Hickton Continuing Discontinued Total
Awards Friedman's Group operations operations Group
2020 2020 2020 2020 2020 2020
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue 844 3,878 7,139 11,861 2,091 13,952
-------- ----------- -------- ------------ ------------- ---------
Expenses (733) (3,754) (6,210) (10,697) (2,211) (12,908)
Segmental result
(EBITDA) before
exceptional costs 111 124 929 1,164 (120) 1,044
-------- ----------- -------- ------------ ------------- ---------
Depreciation and
amortisation charge (7) (209) (40) (256) (63) (319)
IFRS 16 depreciation (47) (139) (63) (249) (34) (283)
Exceptional items - - (481) (481) (64) (545)
Profit on disposal
of discontinued
operations - 626 626
Group costs (430) - (430)
Net finance costs
(including IFRS
16) (708) (30) (738)
------------ ------------- ---------
(Loss)/profit before
taxation (960) 315 (645)
Taxation (20) - (20)
------------ ------------- ---------
(Loss)/profit for
the year (980) 315 (665)
------------ ------------- ---------
Aford Hickton Continuing Discontinued Total
Awards Friedman's Group operations operations Group
2019 2019 2019 2019 2019 2019
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue 1,969 5,791 4,741 12,501 9,252 21,753
-------- ----------- -------- ------------ ------------- ---------
Expenses (1,558) (4,547) (3,891) (9,996) (10,786) (20,782)
Segmental result
(EBITDA) before
exceptional costs 411 1,244 850 2,505 (1,534) 971
-------- ----------- -------- ------------ ------------- ---------
Depreciation and
amortisation charge (9) (208) (12) (229) (203) (432)
IFRS 16 depreciation (43) (102) (19) (164) (37) (201)
Exceptional items - - - - (1,836) (1,836)
Group costs (376) - (376)
Net finance costs
(including IFRS
16) (312) (101) (413)
------------ ------------- ---------
Profit/(loss) before
taxation 1,424 (3,711) (2,287)
Taxation (342) - (342)
------------ ------------- ---------
Profit/(loss) for
the year 1,082 (3,711) (2,629)
------------ ------------- ---------
ii) Assets and liabilities by segment
As at 31 December
Segment assets Segment liabilities Segment net assets/(liabilities)
2020 2019 2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------- -------- ---------- ---------- ----------------- ----------------
Continuing operations
CEPS Group 57 52 (5,995) (5,041) (5,938) (4,989)
Aford Awards 1,661 1,576 (601) (407) 1,060 1,169
Friedman's 7,363 7,923 (2,227) (2,490) 5,136 5,433
Hickton Group 7,393 3,663 (6,558) (1,279) 835 2,384
Discontinued operations
CEM Press - 1,386 - (3,177) - (1,791)
Davies Odell - 1,509 - (964) - 545
Total - Group 16,474 16,109 (15,381) (13,358) 1,093 2,751
-------- -------- ---------- ---------- ----------------- ----------------
(iii) Revenue by geographical destination
2020 2019
GBP'000 GBP'000
UK 11,939 18,874
Europe 1,091 1,693
Rest of world 922 1,186
-------- --------
13,952 21,753
-------- --------
5. Taxation
2020 2019
GBP'000 GBP'000
-------- --------
Analysis of taxation in the year:
Current tax
Tax on profits of the year 41 340
Tax in respect of prior years (14) (7)
-------- --------
Total current tax 27 333
-------- --------
Deferred tax
Current year deferred tax movement (13) 2
Tax in respect of prior years 6 7
Total deferred tax (7) 9
-------- --------
Total tax charge 20 342
-------- --------
The tax assessed for the year is higher (2019: higher) than the
standard rate of corporation tax in the UK (19%) (2019: 19%)
Factors affecting current tax:
Loss before taxation (645) (2,287)
------ --------
Loss multiplied by the standard rate of UK
tax of 19% (2019: 19%) (123) (435)
Effects of:
Expenses not deductible 46 613
Expenses not deductible goodwill impairment 67 75
Adjustments to brought-forward values - 21
Amounts credited directly to Other Comprehensive
Income - 19
Capital allowances in excess of depreciation - 3
Adjustments to tax in prior periods (14) -
Transfer pricing adjustment - (15)
Other timing differences (2) -
Gain on disposal not taxed (119) -
Adjustments to deferred tax rate 6 3
Deferred tax not recognised 159 58
Total tax charge 20 342
------ --------
The standard rate of corporation tax in the UK changed to 19%
with effect from 1 April 2017. Accordingly, the Group's profits
have been taxed at the actual rate of 19%.
The Finance Act 2016 included legislation to reduce the main
rate of corporation tax from 19% to 17% from 1 April 2020. A change
to the main rate of corporation tax announced in the 2020 Budget
was substantively enacted on 17 March 2020. The rate from 1 April
2020 remains at 19% rather than the previously enacted reduction to
17%. The rate of 19% is accordingly applied to UK deferred taxation
balances at 30 September 2020 (2019: 17%). In March 2021 it was
announced that the rate of corporation tax is expected to increase
to 25% from April 2023.
There are tax losses carried forward in the Company of
approximately GBP1.3m and in the subsidiary companies of
GBP195,000.
6. Earnings per share
Basic earnings per share is calculated on the loss for the year
after taxation attributable to the owners of the parent of
GBP624,000 (2019: loss GBP2,696,000) and on 17,000,000 (2019:
17,000,000) ordinary shares, being the weighted number in issue
during the year.
Basic earnings per share for continuing operations is calculated
on the loss for the year after taxation attributable to owners of
the parent of GBP939,000 (2019: profit GBP375,000) and on
17,000,000 (2019: 17,000,000) ordinary shares, being the weighted
number in issue during the year. Basic earnings per share for
discontinued operations is calculated on the profit for the year
after taxation attributable to owners of the parent of GBP315,000
(2019: loss GBP3,071,000) and on 17,000,000 (2019: 17,000,000)
ordinary shares, being the weighted number in issue during the
year.
There are no potentially dilutive shares in the Group.
7. Property, plant and equipment
Leasehold Plant, machinery, Motor Total
property tools and vehicles
improvements moulds
Group GBP'000 GBP'000 GBP'000 GBP'000
-------------- ------------------ ---------- --------
Cost
at 1 January 2019 384 2,760 38 3,182
Assets acquired on purchase
of a subsidiary 255 1,313 8 1,576
Additions at cost 38 203 - 241
Transfers - (3) - (3)
Disposals - (224) - (224)
-------------- ------------------ ---------- --------
at 31 December 2019 677 4,049 46 4,772
Assets acquired on purchase
of a subsidiary 34 77 - 111
Additions at cost 22 74 - 96
Disposals on sale or
administration of subsidiaries (253) (3,559) (37) (3,849)
Disposals - (35) - (35)
-------------- ------------------ ---------- --------
at 31 December 2020 480 606 9 1,095
-------------- ------------------ ---------- --------
Accumulated depreciation
at 1 January 2019 79 2,087 25 2,191
Accumulated depreciation
acquired on purchase
of a subsidiary 199 904 - 1,103
Charge for the year 62 295 10 367
Impairment - 229 - 229
Transfers - (3) - (3)
Disposals - (214) - (214)
at 31 December 2019 340 3,298 35 3,673
Accumulated depreciation
acquired on purchase
of a subsidiary 24 51 - 75
Charge for the year 50 202 1 253
Disposals on sale or
administration of subsidiaries (225) (3,253) (27) (3,505)
Disposals - (34) - (34)
at 31 December 2020 189 264 9 462
-------------- ------------------ ---------- --------
Net book amount
at 31 December 2020 291 342 - 633
-------------- ------------------ ---------- --------
at 31 December 2019 337 751 11 1,099
-------------- ------------------ ---------- --------
At the year end, assets held under hire purchase contracts or
finance leases and capitalised as plant, machinery, tools and
moulds have a net book value of GBP46,000 (2019: GBP290,000).
The depreciation of GBP23,000 in respect of these has been
charged to cost of sales in the Consolidated Statement of
Comprehensive Income.
8. Right-of-use assets
Leasehold Plant, machinery,
property tools and Motor
improvements moulds vehicles Total
Group GBP'000 GBP'000 GBP'000 GBP'000
-------------- ------------------ ---------- --------
Cost
at 1 January 2019 1,238 - 99 1,337
Additions at cost 83 - 50 133
------------------
at 31 December 2019 1,321 - 149 1,470
Assets acquired on purchase
of a subsidiary 30 11 14 55
Additions at cost 162 5 - 167
Reclassification 39 - (39) -
Disposals on sale of a
subsidiary (52) - (48) (100)
Disposals at the end of
the lease term (98) - (64) (162)
-------------- ------------------ ---------- --------
At 31 December 2020 1,402 16 12 1,430
-------------- ------------------ ---------- --------
Accumulated depreciation
At 1 January 2019 160 - 37 197
Charge for the year 160 - 41 201
-------------- ------------------ ---------- --------
at 31 December 2019 320 - 78 398
Charge for the year 246 5 32 283
Disposals on sale of a
subsidiary (26) - (39) (65)
Disposals at the end of
the lease term (98) - (64) (162)
-------------- ------------------ ---------- --------
At 31 December 2020 442 5 7 454
-------------- ------------------ ---------- --------
Net book amount
at 31 December 2020 960 11 5 976
-------------- ------------------ ---------- --------
at 31 December 2019 1,001 - 71 1,072
-------------- ------------------ ---------- --------
9. Business combinations and disposals
i) Acquisition in 2020 of Cook Brown Building Control Limited and Cook Brown Energy Limited
On 11 March 2020, a newly-incorporated subsidiary, Hickton Group
Limited, acquired 100 per cent of the issued share capital of Cook
Brown Building Control Limited and Cook Brown Energy Limited.
The acquisition has been accounted for using the acquisition
method of accounting. After the alignment of accounting policies
and other adjustments to the valuation of assets and liabilities to
reflect their fair value at acquisition, the fair value of net
assets acquired was GBP296,000.
Goodwill of GBP3,234,000 arose from the acquisition primarily in
respect of the overall workforce skills and their ability to
generate income. Acquisition fees of GBP101,000 were incurred which
have been expensed as an exceptional administrative cost in the
year.
The following table shows the fair value of assets and
liabilities included in the consolidated statements at the date of
acquisition:
Fair value
GBP'000
Identifiable assets and liabilities
Intangible assets 9
Property, plant and equipment 91
Trade and other receivables 643
Cash and cash equivalents 734
Trade and other payables (1,021)
Lease liabilities (55)
Corporation tax payable (103)
Deferred taxation (2)
----------------------
296
----------------------
Consideration
Cash consideration 1,600
Existing loans offset against
consideration 270
Shares issued 25
Loan notes issued 1,635
----------------------
Goodwill 3,234
----------------------
Analysis of cash flows on acquisition
Cash paid 1,600
Less: net cash acquired with
the subsidiary (734)
----------------------
Net cash outflow on acquisition 866
----------------------
From the date of acquisition Cook Brown Building Control Limited
and Cook Brown Energy Limited contributed GBP2,834,000 of revenue
and GBP437,000 profit before tax. If the combination had taken
place at the beginning of the year, revenue would have been
GBP3,408,000 and the profit before tax would have been
GBP517,000.
ii) Disposal in 2020 of CEM Press Limited, Travelfast Limited
(trading as Sampling International) and Davies Odell Limited
An administration process commenced in January 2020 in respect
of CEM Press Limited and Travelfast Limited (trading as Sampling
International) and they have been treated as disposals from 1
January 2020.
On 20 December 2020, CEPS PLC acquired the minority interest of
15% in Davies Odell Limited and transferred the shares to a new
company, Vale Brothers Group Limited, in return for a 33%
shareholding.
This ceased to be a subsidiary and is now treated as an
associate.
The trading from Davies Odell Limited and the profit on disposal
of all subsidiaries is presented in discontinued operations in the
Consolidated Statement of Comprehensive Income.
The assets and liabilities disposed of were as follows:
CEM Press
and Travelfast Davies Odell
GBP'000 GBP'000
Property, plant and equipment 239 139
Inventories 9 429
Trade and other receivables 1,135 396
Cash and cash equivalents 4 -
Borrowings (1,147) (303)
Trade and other payables (1,839) (404)
Lease liabilities (97) (58)
Corporation tax payable (103) -
Deferred taxation (53) -
---------------- -------------
(1,852) 199
---------------- -------------
Fair value consideration - -
Non-controlling interest released 1,027 -
---------------- -------------
(Profit)/loss on disposal (825) -
---------------- -------------
The cash flows from the discontinued operations were as
follows:
2020 2019
GBP'000 GBP'000
Operating cash flows 58 (958)
Investing cash flows (5) (9)
Financing cash flows (164) 931
10. Intangible assets
Customer
Goodwill lists Other Total
Group GBP'000 GBP'000 GBP'000 GBP'000
--------- --------- -------- --------
Cost
at 1 January 2019 5,606 772 250 6,628
Additions at cost 2,078 - 1 2,079
At 31 December 2019 7,684 772 251 8,707
Additions at cost 3,234 - 34 3,268
Disposals (1,241) - - (1,241)
At 31 December 2020 9,677 772 285 10,734
--------- --------- -------- --------
Accumulated amortisation
and impairment
at 1 January 2019 1,221 597 69 1,887
Amortisation charge - - 62 62
Impairment 10 (7) - 3
Impairment 395 - - 395
at 31 December 2019 1,626 590 131 2,347
Amortisation charge - - 66 66
Impairment 172 182 - 354
Disposals (1,241) - - (1,241)
at 31 December 2020 557 772 197 1,526
--------- --------- -------- --------
Net book amount
at 31 December 2020 9,120 - 88 9,208
--------- --------- -------- --------
at 31 December 2019 6,058 182 120 6,360
--------- --------- -------- --------
Goodwill is not amortised under IFRS, but is subject to
impairment testing either annually or on the occurrence of a
triggering event. Impairment charges are included in administration
expenses and disclosed as an exceptional cost.
Customer lists are subject to annual impairment reviews.
Other intangibles relate to computer software, website costs and
licences and are amortised over their estimated economic lives. The
annual amortisation charge is expensed to cost of sales in the
Consolidated Statement of Comprehensive Income.
Impairment tests for goodwill and intangible assets
The Group tests goodwill and intangible assets arising on the
acquisition of a subsidiary (customer lists) annually for
impairment or more frequently if there are indications that
goodwill or customer lists may be impaired.
For the purpose of impairment testing, goodwill and customer
list assets are allocated to the Group's cash generating units
(CGUs) on a business segment basis:
CEM
Aford Awards Press Friedman's Hickton Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Goodwill and customer
lists
at 1 January 2019 1,043 - 1,484 2,033 4,560
Additions at cost - 395 1,683 - 2,078
Amortisation charge (3) - - - (3)
Impairment - (395) - - (395)
------------- -------- ----------- ---------- --------
at 31 December 2019 1,040 - 3,167 2,033 6,240
Additions at cost - - - 3,234 3,234
Impairment - - - (354) (354)
------------- -------- ----------- ---------- --------
at 31 December 2020 1,040 - 3,167 4,913 9,120
------------- -------- ----------- ---------- --------
The recoverable amount of a CGU is based on value-in-use
calculations. These calculations use cash flow projections based on
financial budgets approved by management covering a five-year
period. Cash flows beyond five years are assumed to increase only
by a long-term growth rate of 1%. A discount rate of 10.0% (2019:
10.6%), representing the estimated pre-tax cost of capital, has
been applied to these projections.
The key assumptions used in the value-in-use calculations are
that trading will return to pre-pandemic revenue levels in the
Friedman's and Aford Awards businesses over the course of two years
and that gross margins will recover in 2021. The Hickton Group
businesses have not been affected to any major degree and forecasts
reflect a continuation of 2020 trading results and underlying
growth trends.
Management has determined the budgeted revenue growth and gross
margins based on past performance and their expectations of market
developments in the future. Long-term growth rates are based on the
lower of the UK long-term growth rate and management's general
expectations for the relevant CGU.
In respect of Aford Awards, Friedman's, Hickton Consultants and
Cook Brown within the Hickton Group the value-in-use calculation
gives rise to sufficient headroom such that reasonable changes in
the key assumptions do not eliminate the headroom. The Milano
business within the Friedman's segment has been impacted by the
pandemic, but a return to the level of trading profits achieved
prior to this supports the goodwill in respect of this
business.
At 31 December 2020 impairment charges of GBP354,000 have been
taken against the BRCS business goodwill and customer list assets
(within Hickton) as this business incurred a loss in both 2019 and
2020. Actions have been taken to improve margins with a break-even
performance projected, but there is at present insufficient
certainty over future trading profits to support these intangible
assets. In 2019 an impairment charge of GBP395,000 was taken
against the goodwill arising on the acquisition of Travelfast
Limited (trading as Sampling International) as it went into
administration on 15 January 2020.
11. Share capital and share premium
Number of
shares Share capital Share premium Total
GBP'000 GBP'000 GBP'000
At 31 December 2019 and
31 December 2020 17,000,000 1,700 5,841 7,541
----------- -------------- -------------- --------
12. Post balance sheet events
On 21 January 2021 D A Horner agreed to provide to the Company
an additional GBP100,000 for general working capital purposes. This
is in addition to the GBP650,000 loan in place at the year end.
On 15 March 2021, Hickton Group Limited ('HGL'), the Company's
54.7% subsidiary, completed the acquisition of the entire issued
share capital of Millington Lord Limited and its subsidiaries
Morgan Lambert Limited ('MLL'), Qualitas Compliance Limited ('QCL)
and Morgan Lambert Electrical Limited ('MLEL'), which is not
actively trading. MLL and QCL provide building inspection related
services which are complementary to those already provided by HGL
in this sector. The consideration was a maximum of GBP1.1 million,
which comprised a cash payment on completion of GBP700,000 plus a
further GBP299,999 deferred, to be paid in two instalments:
GBP150,000 on or before 30 June 2021 and GBP149,999 on or before 31
August 2021. An additional up to GBP100,000 may be payable,
dependent on the acquired business group achieving certain turnover
targets over the same period. The acquisition was funded from
existing cash resources within HGL.
On 15 April 2021, HGL also drew down on a four-year GBP500,000,
secured Coronavirus Business Interruption Loan ('CBIL') with
Santander UK plc available for general corporate purposes. The CBIL
is repayable in equal quarterly payments commencing approximately
12 months after drawdown and attracts an annual interest rate of
3.8% over Bank of England base rate.
On 20 May 2021, CEPS entered into a loan agreement ("Loan") with
a third party for GBP2,000,000. In drawdown, which is anticipated
to be on or around 28 June 2021, the Loan will be used to repay an
existing GBP2,000,000 from another third party which falls due for
payment on 30 June 2021. The Loan carries interest at an annual
rate of 7% and is repayable on or before 30 June 2022. The loan is
guaranteed by D A Horner.
13. Distribution of the Annual Report and Notice of AGM
A copy of the 2020 Annual Report, together with a notice of the
Company's Annual General Meeting ('AGM') to be held at 11:30am on
Tuesday 22 June 2021 at 11 Laura Place, Bath BA2 4BL , will be sent
to all shareholders on Friday 28 May 2021. Further copies will be
available to the public from the Company Secretary at the Company's
registered address at 11 Laura Place, Bath BA2 4BL and from the
Group website, www.cepsplc.com .
The AGM would normally provide an opportunity for shareholders
to meet with the directors, for the directors to provide an update
on the Company's business and to answer questions from
shareholders. We would normally, therefore, welcome shareholders
who choose to attend the AGM in person.
However, in the light of the uncertainty surrounding the
government's proposed intention to remove all legal limits on
social contact on or before Monday 21 June 2021, the special
arrangements described below will be followed for the holding of
the AGM this year, unless the Company subsequently notifies you
otherwise.
Two Company directors who are entitled to vote at the meeting
will be physically present at the AGM in order to form the
necessary quorum to enable the business of the meeting to be
carried out. In the event that one of those directors is not the
Company's Chairman, David Horner, one of the directors who is
present will be designated as Chairman of the AGM.
We are sorry to have to inform you that no other shareholders
will be permitted to attend the AGM. Any person who does attempt to
attend the AGM in person, other than those required to form the
quorum, will be refused admission.
All of the resolutions to be put to shareholders at the AGM will
be put to a vote on a poll, rather than a show of hands.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
FR USRNRAKUVUAR
(END) Dow Jones Newswires
May 25, 2021 02:00 ET (06:00 GMT)
Ceps (LSE:CEPS)
Historical Stock Chart
From Mar 2024 to Apr 2024
Ceps (LSE:CEPS)
Historical Stock Chart
From Apr 2023 to Apr 2024