TIDMFOUR

RNS Number : 7240V

4imprint Group PLC

16 April 2021

16 April 2021

4imprint Group plc (the "Company")

Publication and Posting of the Annual Report and Accounts 2020

The Company has published its Annual Report and Accounts 2020 ("Annual Report"), together with a Notice of Annual General Meeting and Form of Proxy, and these documents have been posted to Shareholders.

Copies of the Annual Report and Notice of Annual General Meeting are available on the Company's website, https://investors.4imprint.com.

Copies of the Annual Report, Notice of Annual General Meeting and Form of Proxy have been submitted to the National Storage Mechanism and will shortly be available at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

The Annual General Meeting (the "AGM") of the Company is scheduled to be held at 11.00 on 18 May 2021 at 4imprint, 5 Ball Green, Cobra Court, Trafford Park, Manchester, M32 0QT.

However, in light of the continuing COVID-19 situation and the public health guidance and social distancing measures issued by the Government, we intend to hold the AGM with the minimum attendance required to form a quorum and Shareholders will not therefore be able to attend the AGM in person.

The situation is constantly evolving, and the Government may change current restrictions or guidance. Any changes to the arrangements for our AGM (including any change to the location, time or date of the meeting) will be communicated to Shareholders in accordance with our Articles of Association and by Stock Exchange Announcement, as early as possible before the date of the meeting

Given Shareholders will unfortunately not be able to attend the AGM in person, we strongly recommend that all Shareholders complete and submit a proxy form in accordance with the instructions set out in the Shareholder Notes to the Notice of Annual General Meeting. Shareholders are also encouraged to submit any questions that they would have raised at the AGM in advance, and we will publish the answers to those questions on our website, as set out in the Notice of Annual General Meeting.

A condensed set of the financial statements for the 53 weeks ended 2 January 2021, together with information on important events that occurred during that financial period and their impact on the financial statements, were contained in the Final Results RNS announcement made on 16 March 2021. That information, together with the information set out in the appendices to this announcement, which is extracted from the Annual Report, constitute the material required by DTR 6.3.5R which is required to be communicated in full unedited text through a Regulatory Information Service. This announcement is not a substitute for reading the Annual Report.

In the appendices, "Group" is 4imprint Group plc and its subsidiaries, and page references are to pages in the Annual Report and Accounts 2020.

For further information, please contact:

Emma Taylor

Company Secretary

4imprint Group plc

Tel: 020 3709 9680

E-mail: agm@4imprint.com

Appendices

   A.   Statement of Directors' Responsibilities in respect of the Financial Statements 

The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable United Kingdom law and regulations.

Company law requires the Directors to prepare financial statements for each financial period. Under that law the Directors have elected to prepare the Group and Company financial statements in accordance with International Accounting Standards in conformity with the requirements of the Companies Act 2006 and International Financial Reporting Standards adopted pursuant to Regulation (EC) No.1606/2002 as it applies in the European Union ("IFRSs"). Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group for that period.

In preparing the financial statements, the Directors are required to:

-- Select suitable accounting policies in accordance with IAS 8 'Accounting Policies, Changes in Accounting Estimates and Errors' and then apply them consistently

   --      Make judgments and accounting estimates that are reasonable and prudent 

-- Present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information

-- Provide additional disclosures when compliance with the specific requirements in IFRSs is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Group's and Company's financial position and financial performance

-- In respect of the Group's and Company's financial statements, state whether IFRSs have been followed, subject to any material departures disclosed and explained in the financial statements

-- Prepare the financial statements on the going concern basis unless it is appropriate to presume that the Group and Company will not continue in business

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group and Company's transactions and disclose with reasonable accuracy at any time the financial position of the Group and Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Group and Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Under applicable law and regulations, the Directors are also responsible for preparing a Strategic Report, Directors' Report, Remuneration Report and Corporate Governance Statement that comply with that law and those regulations. The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website.

Each of the Directors, whose names and functions are listed in the Board of Directors on pages 46 and 47, confirm, to the best of their knowledge:

-- That the consolidated financial statements, prepared in accordance with IFRSs, give a true and fair view of the assets, liabilities, financial position and profit of the Company and undertakings included in the consolidation taken as a whole

-- That the Annual Report, including the Strategic Report, includes a fair review of the development and performance of the business and the position of the Company and undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face

-- That they consider the Annual Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for Shareholders to assess the Group's position, performance, business model and strategy

Emma Taylor

Company Secretary

16 March 2021

B. Principal risks & uncertainties

The list below is extracted in full and unedited from the Annual Report and Accounts 2020, pages 26 to 31.

Outlined below are the current principal potential risks and uncertainties to the successful delivery of the Group's strategic goals. The list is not exhaustive and other, as yet unidentified, factors may have an adverse effect.

Economic, market and environmental risks

 
 Macroeconomic conditions 
 
   Description of risk 
   The business conducts most of its operations in North America 
   and would be affected by a downturn in general economic 
   conditions in this region or negative effects from tension 
   in international trade. In previous economic downturns 
   (excluding the COVID-19 pandemic), the promotional products 
   market has typically softened broadly in line with the 
   general economy. 
 Potential impact 
  *    Customer acquisition and retention could fall,            Link to strategy 
       impacting revenue in current and future periods.           *    Organic revenue growth 
 
 
  *    The growth and profitability levels called for in the      *    Cash generation and profitability 
       Group strategic plan may not be achieved. 
 
 
  *    Cash generation could be reduced broadly 
       corresponding to a reduction in profitability. 
 Mitigating activities 
  *    Management monitors economic and market conditions to     Direction 
       ensure that appropriate and timely adjustments are         *    The COVID-19 pandemic has had a significant negative 
       made to marketing and other budgets.                            impact on demand for our products due to the overall 
                                                                       economic impact of the pandemic as well as the 
                                                                       resulting restrictions/concerns around 
  *    The customer proposition in terms of promotions,                meetings/gatherings 
       price, value and quality of product can be adjusted 
       to resonate with customer requirements and budgets in 
       changing economic climates.                                *    International trade tensions and political 
                                                                       instability have increased economic volatility in the 
                                                                       US 
  *    The Group's balance sheet funding policy aims to 
       provide operational and financial flexibility to 
       facilitate continued investment in the business            *    Brexit uncertainty in the UK has led to lack of 
       through different economic cycles.                              business confidence 
 
 
                                                                 Significantly increased 
 
 
 Markets & competition 
 
   Description of risk 
   The promotional products markets in which the business 
   operates are intensely competitive. New or disruptive business 
   models looking to break down the prevailing distributor/supplier 
   structure may become a threat. Buying groups and online 
   marketplaces may allow smaller competitors access to improved 
   pricing and services from suppliers. Private equity interest 
   in the promotional products industry has increased in recent 
   years, offering potential funding for existing competitors 
   or new entrants. The effects of the COVID-19 pandemic may 
   reduce the use of promotional products in the future. 
 Potential impact 
   *    Aggressive competitive activity or a disruptive new       Link to strategy 
        model could result in pressure on prices, margin           *    Market leadership 
        erosion and loss of market share, impacting the 
        financial results. 
                                                                   *    Organic revenue growth 
 
   *    The Group's strategy based on achieving organic 
        revenue growth in fragmented markets may need to be        *    Cash generation and profitability 
        reassessed. 
 
 
   *    Customer acquisition and retention could fall, 
        impacting revenue in current and future periods. 
 
  Mitigating activities 
   *    An open-minded culture and an appetite for technology     Direction 
        are encouraged, with the aim of positioning the            *    The competitive landscape to date has been relatively 
        business at the forefront of innovation in the                  consistent in our main markets 
        industry. 
 
                                                                   *    No disruptive model has yet gained much traction in 
   *    Management closely monitors competitive activity in             the industry 
        the marketplace. 
 
                                                                  = Unchanged 
   *    Price, satisfaction and service level guarantees are 
        an integral part of the customer proposition. 
        Negative customer feedback is investigated and 
        addressed rapidly. 
 
 
   *    Management regularly surveys customers and engages in 
        research to monitor changing customer interests and 
        perceptions. Merchandising and supply chain teams, in 
        collaboration with our suppliers, have experience in 
        rapidly adapting the product range to meet evolving 
        consumer demand. Management is prepared to test 
        and/or add additional products to meet changing 
        customer service requirements. 
 
 
 Currency exchange 
 
   Description of risk 
   There is some exposure to currency exchange risk. Although 
   the business trades predominantly in US dollars, it also 
   transacts business in Canadian dollars, Sterling and Euros, 
   leading to some currency risk on trading. In addition, 
   head office costs, pension scheme commitments, purchases 
   of own shares and dividends are payable in Sterling. Consequently, 
   the business may be adversely impacted by movements in 
   the Sterling/US dollar exchange rate when it repatriates 
   cash to the UK and on translation of Sterling costs into 
   US dollars. 
 Potential impact 
  *    The financial results of trading operations, and         Link to strategy 
       therefore overall profitability, may be negatively        *    Cash generation and profitability 
       affected. 
 
                                                                 *    Robust financial structure 
  *    The financial condition and cash position of the 
       Group may differ materially from expectations. In an 
       extreme scenario, the Group's strategic objectives 
       around capital structure and core dividend 
       commitments could be disrupted. 
 Mitigating activities 
  *    The Group reports its results in US dollars,             Direction 
       minimising currency impact on reported revenue,           *    Political instability, interest rate policy and trad 
       operating profit and net assets since trading            e 
       operations are concentrated mainly in North America.           tensions (US) and the consequences of Brexit (UK) 
                                                                      have led to increased volatility in currency markets 
 
  *    The Group can use forward contracts to hedge 
       anticipated cash receipts from its overseas              Increased 
       operations, giving some certainty of amounts 
       receivable in Sterling. 
 
 
 Climate change & environment 
 Description of risk 
  Climate change potentially affects our operations, facilities, 
  supply chain, team members, communities and our customers 
  in a variety of ways. As such, it presents a multitude 
  of risks to the business and threatens our ability to achieve 
  our strategic objectives. 
     Potential impact 
       *    Extreme weather-related events that impact our             Link to strategy 
            customers and/or our suppliers can have 'episodic'          *    Cash generation and profitability 
            negative impact on revenue, customer acquisition and 
            retention, and they can also cause increases to our 
            product and distribution costs. Some of our suppliers       *    Building a sustainable business 
            are located in geographic areas that are subject to 
            increased risk for these events. 
 
 
       *    The transition to a low-carbon economy presents 
            several key risks: 
 
 
       *    Potential for increased operational costs related to 
            mitigation efforts, increased regulatory compliance 
            and carbon taxes. 
 
 
       *    Increased product costs charged by our suppliers due 
            to increased input costs and regulatory compliance. 
 
 
       *    Customers will increasingly require a wider range of 
            low-carbon, sustainable product options that may be 
            difficult to identify and source, negatively 
            impacting demand. 
 
 
       *    Increasingly stakeholders will demand that companies 
            are actively and appropriately addressing climate 
            change and there is an increased level of 
            reputational risk for companies that are perceived 
            not to be doing so. 
 
 
     Mitigating activities 
      *    The flexible nature of our 'drop-ship' model allows       Direction 
           for relatively rapid adjustment to episodes of             *    There is an increasing sense of urgency globally, 
           extreme weather. The business has very low customer        and 
           concentration which helps mitigate an element of the            as such, the risks in this area will increase as 
           risk as well.                                             well 
 
 
      *    The business has set a goal to become 'carbon             Increased 
           neutral' by no later than December 2022 and 
           management is actively monitoring and measuring 
           progress towards this goal. 
 
 
      *    Our merchandising teams actively collaborate with our 
           suppliers to continuously curate our range of 
           products to adapt and meet the needs and tastes of 
           our customers. 
 

Operational risks

 
 Business facility disruption 
 
   Description of risk 
   The 4imprint business model means that operations are concentrated 
   in centralised office and distribution facilities. The 
   performance of the business could be adversely affected 
   if activities at one of these facilities were to be disrupted, 
   for example, by pandemic, fire, flood, loss of power or 
   internet/telecommunication failure. 
 Potential impact 
  *    The inability to service customer orders over any         Link to strategy 
       extended period would result in significant revenue        *    Market leadership 
       loss, deterioration of customer acquisition and 
       retention metrics and diminished return on marketing 
       investment.                                                *    Organic revenue growth 
 
 
  *    A significant portion of our apparel orders are            *    Cash generation and profitability 
       embroidered in-house at our distribution centre, 
       therefore disruption at this facility would impact 
       our ability to fulfil these orders. 
 
 
  *    The Group's reputation for excellent service and 
       reliability may be damaged. 
 Mitigating activities 
   *    Back-up and business continuity procedures are in       Direction 
        place to ensure that customer service disruption is      *    The COVID-19 pandemic raises the risk of potential 
        minimised.                                                    shutdown of one or all of our facilities 
 
 
   *    Websites are cloud-based, and data is backed up         Increased 
        immediately to off-site servers. 
 
 
   *    Relationships are maintained with third party 
        embroidery contractors to provide an element of 
        back-up in the event of facility unavailability. 
 
 
   *    A significant proportion of our office and customer 
        service staff can work from home, mitigating some 
        risk should offices become unavailable. 
 
 
 Disruption to the product supply chain or delivery service 
 
   Description of risk 
   As a consequence of the Group's 'drop-ship' distribution 
   model, trading operations could be interrupted if: (i) 
   the activities of a key supplier were disrupted and it 
   was not possible to source an alternative supplier in the 
   short term; (ii) a key supplier's own supply chain is compromised 
   by 'force majeure' events in the country of original product 
   manufacture, for example natural disasters, social/political 
   unrest or pandemic; or (iii) the primary parcel delivery 
   partner used by the business suffered significantly degraded 
   service levels. As the Group continues to grow, the volume 
   of orders placed with individual suppliers becomes significant. 
 Potential impact 
   *    Inability to fulfil customer orders would lead to        Link to strategy 
        lost revenue and a negative impact on customer            *    Market leadership 
        acquisition and retention statistics. 
 
                                                                  *    Organic revenue growth 
   *    The Group's reputation for excellent service and 
        reliability may be damaged. 
                                                                  *    Cash generation and profitability 
 
 
                                                                  *    Building a sustainable business 
 Mitigating activities 
  *    A rigorous selection process is in place for key          Direction 
       suppliers, with evaluation and monitoring of quality,      *    Risk inherent in increasing supplier concentration 
       production capability and capacity, ethical standards 
 , 
       financial stability and business continuity planning.      *    COVID-19 pandemic has increased risk 
 
 
  *    Very close relationships are maintained with key          Increased 
       suppliers, including a detailed shared knowledge of 
       factory locations, operations and capabilities in the 
       country of original product manufacture, allowing 
       swift understanding of and appropriate reaction to 
       events. 
 
 
  *    Dialogue with key suppliers has been increased during 
       the pandemic to monitor for signs of distress. 
 
 
  *    Wherever possible, relationships are maintained with 
       suitable alternative suppliers for each product 
       category. 
 
 
  *    Secondary relationships are in place with alternative 
       parcel carriers. 
 
 
 Disturbance in established marketing techniques 
 
   Description of risk 
   The success of the business relies on its ability to attract 
   new and retain existing customers through a variety of 
   marketing techniques. These methods may become less effective 
   as follows: 
    *    Offline: The flow of print catalogues and sample 
         packages would be disrupted by the incapacity of the 
         US Postal Service to make deliveries, for example due 
         to natural disasters or labour activism. Pandemic 
         conditions that lead to increased levels of people 
         working from remote locations may diminish the 
         effectiveness of this technique. 
 
 
    *    Online: Search engines are an important source for 
         channelling customer activity to 4imprint's websites. 
         The efficiency of search engine marketing could be 
         adversely affected if the search engines were to 
         modify their algorithms or otherwise make substantial 
         changes to their practices. 
 
 
    *    TV/Video/Brand: Fluctuations in available inventory 
         may cause the price of this technique to increase 
         beyond our acceptable thresholds. The evolving nature 
         of how consumers access this type of content can 
         change our ability to effectively access our 
         audience. 
 
 
   In addition, the evolving landscape around data privacy 
   legislation potentially affects our ability to access and 
   analyse customer data information. 
 Potential impact 
  *    If sustained over anything more than a short time         Link to strategy 
       period, an externally driven decrease in the               *    Market leadership 
       effectiveness of key marketing techniques would cause 
       damage to the customer file as customer acquisition 
       and retention fall. This would affect order flow and       *    Organic revenue growth 
       revenue in the short term and the productivity of the 
       customer file over a longer period, impacting growth 
       prospects.                                                 *    Cash generation and profitability 
 
 
  *    Restrictive data privacy legislation could decrease 
       the yield on our marketing activities and might 
       increase compliance costs and the possibility of 
       lawsuits. 
 Mitigating activities 
  *    Offline: Developments in the US Postal Service are        Direction 
       closely monitored through industry associations and        *    Marketing diversification continues via the 
       lobbying groups. Alternative parcel carriers are                successful integration of a brand component to the 
       continuously evaluated.                                         marketing portfolio 
 
 
  *    Online: Management stays very close to new                 *    The COVID-19 pandemic has negatively impacted offline 
       developments and emerging platforms in the online               response rates 
       space. Efforts are focused on anticipating changes 
       and ensuring compliance with both the requirements of 
       providers and applicable laws.                            Increased 
 
 
  *    TV/Video/Brand: Given that this is the newest element 
       of our marketing portfolio, our utilisation of this 
       technique is still in the early stages of its 
       development, allowing for a high degree of 
       flexibility. 
 
 
  *    Data privacy requirements are monitored closely and 
       assessed. 
 
 
 Reliance on key personnel 
 
   Description of risk 
   Performance depends on the ability of the business to continue 
   to attract, motivate and retain key staff. These individuals 
   possess sales and marketing, merchandising, supply chain, 
   IT, financial and general management skills that are key 
   to the continued successful operation of the business. 
 Potential impact 
  *    The loss of key employees or inability to attract         Link to strategy 
       appropriate talent could adversely affect the Group's      *    Market leadership/revenue growth 
       ability to meet its strategic objectives, with a 
       consequent negative impact on future results. 
                                                                  *    Cash generation and profitability 
 
 
                                                                  *    Building a sustainable business 
 Mitigating activities 
   *    The business is proactive in aiming to deliver a         Direction 
        first class working environment. In addition,             *    The business has been able to attract and retain 
        competitive employment terms and incentive plans are           appropriate talent 
        designed with a view to attracting and retaining key 
        personnel. 
                                                                 = Unchanged 
 
   *    Succession planning, both at Board and operational 
        levels. 
 

Technological risks

 
 Failure or interruption of information technology systems 
  and infrastructure 
 
   Description of risk 
   The business is highly dependent on the efficient functioning 
   of its IT infrastructure. An interruption or degradation 
   of services at any 4imprint operational facility would 
   affect critical order processing systems and thereby compromise 
   the ability of the business to deliver on its customer 
   service proposition. 
 Potential impact 
  *    In the short-term, orders would be lost and delivery     Link to strategy 
       deadlines missed, decreasing the efficiency of            *    Market leadership 
       marketing investment and impacting customer 
       acquisition and retention. 
                                                                 *    Organic revenue growth 
 
  *    Revenue and profitability are directly related to 
       order flow and would be adversely affected as a           *    Cash generation and profitability 
       consequence of a major IT failure. 
 
 
  *    Depending on the severity of the incident, 
       longer-term reputational damage could result. 
 Mitigating activities 
  *    There is significant ongoing investment in both the      Direction 
       IT team supporting the business and the hardware and      *    The IT platform is mature, and performance has been 
       software system requirements for a stable and secure           efficient and resilient, including through the 
       operating platform.                                            COVID-19 pandemic with high levels of staff working 
                                                                      from home 
 
  *    Back-up and recovery processes are in place, 
       including immediate replication of data to an            = Unchanged 
       alternative site, to minimise the impact of 
       information technology interruption. 
 
 
  *    Cloud-based hosting for eCommerce and other back end 
       functionality. 
 
 
 Failure to adapt to new technological innovations 
 
   Description of risk 
   The operating platforms of the business may not be able 
   to respond and adapt to rapid changes in technology. If 
   the development of websites and customer-facing applications 
   for alternative devices and platforms is slow or ineffective 
   the business could lose competitive edge. In addition, 
   the development of order processing, supplier-facing and 
   data analytics technologies could fail to deliver the improvements 
   in speed, ease and efficiency necessary to attract and 
   retain a productive customer base. 
 Potential impact 
   *    If the business fails to identify and adopt new           Link to strategy 
        technologies and therefore falls behind in the             *    Market leadership 
        marketplace, it may fail to capture the number of new 
        customers and retain existing customers at the rate 
        required to deliver the growth rates called for in         *    Organic revenue growth 
        the Group's strategic plan. 
 
                                                                   *    Building a sustainable business 
 Mitigating activities 
   *    Management has a keen awareness of the need to keep        Direction 
        pace with the rapidly changing and continuously             *    Innovation remains a priority 
        evolving technological landscape. 
 
                                                                   = Unchanged 
   *    An appetite for technological innovation is 
        encouraged in the business. Sustained investment is 
        made in the development of both outward-facing and 
        back office systems. 
 
 
 Cyber threats 
 
   Description of risk 
   Malware, ransomware and other malicious cyber threats can 
   lead to system failure and/or unauthorised access to and 
   misappropriation of customer data, potentially leading 
   to reputational damage and loss of customer confidence. 
   This is a rapidly changing environment, with new threats 
   emerging on an almost daily basis. 
 Potential impact 
   *    Revenue and profitability are directly related to        Link to strategy 
        order flow and would be adversely affected as a           *    Cash generation and profitability 
        consequence of system compromise. 
 
                                                                  *    Shareholder value 
   *    A significant security breach could lead to 
        litigation and losses, with a costly rectification 
        process. In addition, it might be damaging to the 
        Group's reputation and brand. 
 
 
   *    An event of this nature might result in significant 
        expense, impacting the Group's ability to meet its 
        strategic objectives. 
 Mitigating activities 
  *    The business employs experienced IT staff whose focus     Direction 
       is to identify and mitigate IT security                    *    The general incidence and publicity around 
       vulnerabilities. Investment in software and other               cyber-crime continues to increase 
       resources in this area continues to be a high 
       priority. 
                                                                  *    Increased incidence of malicious cyber activity 
                                                                       during the current COVID-19 pandemic 
  *    Due to the ever-evolving nature of the threat, 
       emerging cyber risks are addressed by the IT security 
       team on a case-by-case basis.                             Increased 
 
 
  *    Technical and physical controls are in place to 
       mitigate unauthorised access to customer data and 
       there is an ongoing investment process to maintain 
       and enhance the integrity and efficiency of the IT 
       infrastructure and its security. 
 

C. Related party transactions

There are no related party transactions requiring disclosure.

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April 16, 2021 04:06 ET (08:06 GMT)