TIDMFOUR
RNS Number : 7008I
4imprint Group PLC
09 August 2023
9 August 2023
4imprint Group plc
Half year results for the 26 weeks ended 1 July 2023
(unaudited)
4imprint Group plc, (the "Group"), a leading direct marketer of
promotional products, today announces its half year results for the
26 weeks ended 1 July 2023.
Half year Half year
2023 2022
Financial Overview $m $m Change
------------ -----------
Revenue 635.5 515.5 +23%
Operating profit 63.8 44.0 +45%
Profit before tax 66.0 43.9 +50%
Cash and bank deposits 74.5 67.1 +11%
-------------------------------------- ------------ ----------- ----------------
Basic EPS (cents) 176.2 118.9 +48%
Interim dividend per share (cents) 65.0 40.0 +63%
Interim dividend per share (pence) 50.8 33.0 +54%
-------------------------------------- ------------ ----------- ----------------
The results for the half year and prior half year are
unaudited.
Operational Overview
* Customer demand at record levels:
* 1,047,000 total orders received in H1 2023 (H1 2022:
886,000)
* 158,000 new customers acquired in H1 2023 (H1 2022:
146,000)
* Net operating profit margin increased to 10.0% (2022:
8.5%), driven principally by improvement in gross
profit percentage and favourable returns on marketing
spend
* Supply chain challenges experienced in 2022 mostly
resolved
* Pension buy-in transaction in June 2023 insured
substantially all remaining pension benefits,
de-risking the balance sheet through the elimination
of inflation, interest rate and longevity risks
* Interim dividend of 65.0c per share declared (2022:
40.0c) reflects performance in the first half of the
year and the Group's strong financial position
Paul Moody, Chairman said:
"The Group's strong first half performance clearly demonstrates
that its strategy and business model are effective in delivering
profitable market share gains.
As a result, the Board's expectation, based on these latest
financial results together with recent internal forecasts, is that
full year 2023 Group revenue will now be slightly above $1.3bn,
with profit before tax not less than $125m.
Trading results in the month of July 2023 have been in line with
the Board's expectations."
For further information, please contact:
4imprint Group plc MHP Group
Tel. + 44 (0) 20 3709 9680 Tel. + 44 (0) 7884 494112
hq@4imprint.co.uk 4imprint@mhpg roup .com
Kevin Lyons-Tarr, Chief Executive
Officer
David Seekings, Chief Financial Katie Hunt
Officer Eleni Menikou
Chairman ' s Statement
Performance summary
Following a very satisfactory post-pandemic rebound in 2022, the
Group has delivered another remarkable operational and financial
performance in the first half of 2023.
Group revenue in the first half of 2023 was $635.5m, an increase
of $120.0m, or 23% over the same period in 2022. Profit before tax
for the period was $66.0m (2022: $43.9m), resulting in basic
earnings per share of 176.2c (2022: 118.9c). The business model
remains very cash-generative, leaving the Group with cash and bank
deposits at the half year of $74.5m (2 July 2022: $67.1m).
Trading momentum in the first half of 2023 was favourable, with
total orders received up 18% over 2022. This result should,
however, be set firmly in the context of relatively weak,
pandemic-affected comparatives in the first quarter of 2022.
Further market share gains are anticipated in the second half of
2023, although we expect the percentage increases in total order
activity seen in the first half to moderate in the second half as a
result of more challenging prior year comparatives.
Strategy
Our strategic direction is uncomplicated and has not changed. We
aim to deliver attractive organic revenue growth by increasing our
share in the fragmented yet substantial markets that we serve. The
Group's performance in the first half of 2023 directly reflects the
success of this strategy.
The development of the brand component of our marketing has been
a key growth driver in recent years. This investment continues as
we further explore the interactions of brand with the other
elements of the overall marketing mix.
Another key factor in the Group's success in the first half of
2023 has been the ability to attract and retain the depth of talent
required to underpin our growth. As ever, our team members are
absolutely essential to our success.
Pension
In June 2023, we took a significant further step in the Group's
long-term commitment to fully de-risk its legacy defined benefit
pension obligations. Through the purchase of a bulk annuity
'buy-in' insurance policy, we were able to eliminate inflation,
interest rate and longevity risks in respect of substantially all
remaining pension benefits. A cash lump sum of approximately $4m
was paid in July by way of a 'top-up' premium for the transaction,
after which balance sheet volatility will cease and future deficit
reduction contributions of around $4m per year will no longer be
required.
Dividend
With a substantial cash and bank deposits balance at the half
year, the Group is in a strong financial position. Consequently,
and in line with its balance sheet funding and capital allocation
guidelines, the Board has declared an interim dividend of 65.0c per
share (2022: 40.0c), an increase of 63%.
Outlook
The Group's strong first half performance clearly demonstrates
that its strategy and business model are effective in delivering
profitable market share gains.
As a result, the Board's expectation, based on these latest
financial results together with recent internal forecasts, is that
full year 2023 Group revenue will now be slightly above $1.3bn,
with profit before tax not less than $125m.
Trading results in the month of July 2023 have been in line with
the Board's expectations.
Paul Moody
Chairman
9 August 2023
Operating and Financial Review
Operating Review
Half
year Half year
2023 2022
Revenue $m $m
----------------------------- ------ ----------
North America 623.8 505.8
UK & Ireland 11.7 9.7
----------------------------- ------ ----------
Total 635.5 515.5
----------------------------- ------ ----------
Half
year Half year
2023 2022
Operating profit $m $m
----------------------------- ------ ----------
Direct Marketing operations 66.3 46.3
Head Office costs (2.5) (2.3)
----------------------------- ------ ----------
Total 63.8 44.0
----------------------------- ------ ----------
The results for the half year and prior half year are
unaudited.
Performance overview
The strong demand patterns seen in the business as 2022
progressed continued into the first half of 2023, producing further
record results.
We flagged in our AGM Trading Update on 24 May 2023 that the
total order count for the first four months of 2023 was running 22%
above the same period in 2022. These very strong demand numbers
were anticipated in the context of weak comparatives from the first
quarter of 2022, a period that included residual pandemic effects.
By the end of June 2023 the year-to-date order count had fallen to
18% above prior year, reflecting the more challenging prior year
comparatives in May and June. We expect that percentage increases
in total order activity over prior year will continue to moderate
for the remainder of the year.
In total, 1,047,000 orders were received in the first half of
2023. This represents an increase of 18% against 886,000 in 2022.
Importantly, we have continued to attract new customers at an
encouraging rate; in the first half of 2023 we acquired 158,000 new
customers, an 8% increase over the 146,000 acquired over the same
period in 2022. Orders from retained customers were stable,
settling back into predictable cohorts and showing typical or even
slightly improved retention characteristics after the major
disruption caused by the pandemic. Average order values were up by
1% in 2023, contributing to total demand revenue (value of orders
received) 20% greater than the same period in 2022.
These very encouraging numbers at the demand level laid a solid
base for significant gains in year-on-year financial performance.
Group revenue for the 2023 half year was $635.5m (2022: $515.5m),
an increase of 23%. Operating profit for the period was $63.8m, an
increase of 45% compared to $44.0m in the first half of 2022.
Operating profit margin percentage for the Group increased into
double digits at 10.0% (2022: 8.5%). On a broad level, two major
factors contributed to this improvement:
-- A strengthening in gross margin percentages due to changes in
product mix, less friction in the supply environment, and careful
pricing adjustments.
-- Leverage from continuing favourable returns on marketing
spend, with our primary KPI, revenue per marketing dollar, at $8.22
(2022: $8.19).
The 4imprint direct marketing business model remains very cash
generative, with minimal working capital requirement and underlying
operating cash flow conversion of 152% in the period (H1 2022:
112%). Free cash flow of $80.8m was generated in the period (H1
2022: $33.6m), contributing to a cash and bank deposits balance at
the 2023 half year of $74.5m (2 July 2022: $67.1m).
Operational highlights
Progress has been made in the following operational areas in the
period.
-- People. Our people are integral to our success. In our 2022
Annual Report we identified our intention to make a significant
investment in the business in 2023, primarily in people, in order
to consolidate existing gains and strengthen our platform ready for
future profitable revenue growth. Despite a tight labour market, we
have been able to attract the high quality talent required to
service the increasing demand. We have continued steadily with the
development of our permanent 'hybrid' working environment for
office-based team members, improving the resilience of the business
in the process.
-- Marketing. The development of, and investment in, the brand
component of our marketing has resulted in materially improved
revenue per marketing dollar as compared to historical norms,
something that we always believed would be the case over time. As
the second half of the year unfolds and we move further away from
prior year comparatives that were influenced by the pandemic, we
will continue to follow our 'test, read, adjust' approach to our
marketing to identify the optimal mix.
-- Supply. The supply chain position so far in 2023 stands in
stark contrast to the same timeframe in 2022. The first half of
2022 saw acute pressure due to challenges around global logistics,
inventory availability and production capacity to keep up with
demand. We relied on the deep relationships that we have with our
key tier 1 suppliers to negotiate these supply chain issues as best
we could. Thankfully, these challenges have now largely been
resolved, taking delays and friction out of the process and
enabling us to deliver a much more predictable service for our
customers. In addition, inflationary pressure on cost of product
has receded along with improving market conditions, vindicating the
thoughtful approach to pricing that has been such an important
factor in enabling us to deliver the strong customer acquisition
and retention numbers described above.
-- Screen-printing. Our new screen-print facility in Appleton,
Wisconsin, went live for production in April 2023. We have been
able to recruit the team members required for the new operation.
Our intention is to scale up further in the coming months to
support our overall apparel decoration capability.
-- Oshkosh facilities. We are currently exploring options around
a further expansion at our distribution centre site in Oshkosh,
Wisconsin. This facility expansion will be aimed primarily at
supporting the continued growth of the apparel category of our
product range. It is anticipated that detailed plans will be
finalised before the end of 2023, with the associated capital
investment expected to be primarily in 2024.
Summary
We remain confident that significant market share opportunity
lies ahead.
Financial Review
Half
year Half year
2023 2022
$m $m
--------------------------- ------- ----------
Operating profit 63.8 44.0
Net finance income/(cost) 2.2 (0.1)
Profit before tax 66.0 43.9
Taxation (16.5) (10.5)
----------------------------- ------- ----------
Profit for the period 49.5 33.4
----------------------------- ------- ----------
The results for the half year and prior half year are
unaudited.
The Group's operating result in the period, summarising expense
by function, was as follows:
Half year Half year
2023 2022
$m $m
-------------------------------------------------------- ---------- ----------
Revenue 635.5 515.5
-------------------------------------------------------- ---------- ----------
Gross profit 193.3 147.9
Marketing costs (77.3) (62.9)
Selling costs (22.7) (18.0)
Administration and central costs (28.5) (22.3)
Share option charges and related social security costs (0.5) (0.5)
Defined benefit pension scheme administration costs (0.5) (0.2)
-------------------------------------------------------- ---------- ----------
Operating profit 63.8 44.0
-------------------------------------------------------- ---------- ----------
Operating result
Following a record year in 2022, the first six months of 2023
saw continued strong demand, particularly in the first quarter
against a relatively weak, pandemic-affected, 2022 comparative.
This led to a total increase at the demand revenue level (value of
orders received) of 20% over 2022, including an increase in average
order value of 1%. Reported revenue for the period was even higher
at 23% above 2022, benefitting from faster order cycle times, fewer
order cancellations and lower claims/credits in a much more robust
supply chain environment.
The gross profit percentage of 30.4% has improved markedly from
28.7% for H1 2022. Revenue gains and much improved supply chain
conditions over the period have resulted in lower transportation
costs, greater leverage over direct labour costs, and a carefully
managed balance between supplier cost increases and customer price
adjustments.
The step change in marketing productivity driven largely by
investment in the brand element of the marketing mix has been
maintained into 2023, with marketing costs representing a very
efficient 12% of revenue (H1 2022: 12%), producing revenue per
marketing dollar of $8.22 (H1 2022: $8.19).
Selling, administration, and central costs together have
increased 27% over H1 2022. This increase is mainly attributable to
investment in people, most notably customer service resource, and
higher incentive compensation accruals in line with trading
performance.
These factors, when combined, demonstrate the financial leverage
in the business model, delivering material uplifts in both
operating profit to $63.8m (H1 2022: $44.0m) and operating margin
to 10.0% (H1 2022: 8.5%).
Foreign exchange
The primary US dollar exchange rates relevant to the Group's
results were as follows:
Half year 2023 Half year 2022 Full year 2022
Period Average Period Average Period end Average
end end
---------- ------- -------- ------- -------- ----------- --------
Sterling 1.27 1.23 1.20 1.30 1.20 1.24
Canadian
dollars 0.76 0.74 0.77 0.79 0.74 0.77
---------- ------- -------- ------- -------- ----------- --------
The Group reports in US dollars, its primary trading currency.
It also transacts business in Canadian dollars, Sterling and Euros.
Sterling/US dollar is the exchange rate most likely to impact the
Group's financial performance.
The primary foreign exchange considerations relevant to the
Group's operations are as follows:
-- Translational risk in the income statement remains low with
the majority of the Group's revenue arising in US dollars, the
Group's reporting currency.
-- Most of the constituent elements of the Group balance sheet are US dollar-based.
-- The Group generates cash mostly in US dollars, but its
primary applications of post-tax cash are Shareholder dividends,
some Head Office costs and, up until the end of July 2023, pension
deficit reduction contributions, all of which are paid in
Sterling.
As such, the Group's cash position is sensitive to Sterling/US
dollar exchange movements. To the extent that Sterling weakens
against the US dollar, more funds are available in payment currency
to fund these cash outflows.
Share option charges
A total of $0.5m (H1 2022: $0.5m) was charged in the period in
respect of IFRS 2 'Share-based Payments'. This was made up of two
elements: (i) executive awards under the 2015 Incentive Plan and
replacement Deferred Bonus Plan ("DBP"); and (ii) charges in
respect of the UK SAYE Scheme and US Employee Stock Purchase
Plan.
Current options and awards outstanding are 11,532 share options
under the UK SAYE scheme, 87,000 share options under the US
Employee Stock Purchase Plan, and 42,631 share awards under the
2015 Incentive Plan and DBP.
Net finance income/(cost)
Net finance income in the period was $2.2m (H1 2022: net finance
cost $0.1m). This comprises interest earned on cash deposits, lease
interest charges under IFRS 16, and the net finance income on the
defined benefit pension plan assets and liabilities. Improving
deposit rates, particularly in the US where interest rates have
been steadily increasing, combined with significant cash balances,
have driven the improvement in the net interest position over the
prior period.
Taxation
The tax charge for the half year was $16.5m (H1 2022: $10.5m),
giving an effective tax rate of 25% (H1 2022: 24%). The tax charge
relates principally to taxation payable on profits earned in North
America.
Earnings per share
Basic earnings per share was 176.2c (H1 2022: 118.9c). The
increase reflects the strong financial results in the period, a
consistent effective tax rate, and a weighted average number of
shares in issue similar to prior year.
Dividends
Dividends are determined in US dollars and paid in Sterling,
converted at the exchange rate on the date that the dividend is
declared.
The Board has declared an interim dividend per share of 65.0c,
(2022: 40.0c), an increase of 63%. In Sterling, the interim
dividend per share will be 50.8p (2022: 33.0p). The dividend will
be paid on 15 September 2023 to Shareholders on the register at the
close of business on 18 August 2023.
Defined benefit pension plan
The Group sponsors a legacy UK defined benefit pension plan (the
"Plan") which has been closed to new members and future accruals
for several years. The Plan has 120 pensioners and 202 deferred
members.
At the end of June 2023, the Trustee of the Plan entered into an
agreement with Legal and General Assurance Society Limited to
insure substantially all remaining pension benefits of the Plan
through the purchase of a bulk annuity policy. The transaction took
the form of a buy-in arrangement, with the insurer funding the Plan
for the future payment of liabilities. The fair value of the bulk
annuity policy matches the liabilities being insured, thus
eliminating inflation, interest rate and longevity risks. The
premium of GBP20.7m was settled by the transfer of the Plan's
existing investment portfolio valued at GBP17.5m and a cash amount
of GBP3.2m (c.$4m) paid by the Group after the date of these
interim financial statements in early July 2023.
This buy-in agreement was an investment decision for the Plan,
consistent with both the Trustee's overriding objective to enhance
the security of the benefits payable to members and the Group's
long-term commitment to the full de-risking of its legacy defined
benefit pension obligations. As a result of this transaction, the
Group will cease to make monthly deficit funding contributions to
the Plan from August 2023 but will still fund the ongoing
administration costs and settlement of residual liabilities.
At 1 July 2023, the surplus of the Plan on an IAS 19 basis was
$0.1m, compared to a surplus of $1.2m at 31 December 2022. Gross
Plan assets under IAS 19 were $22.1m, and liabilities were
$22.0m.
The change in the surplus is analysed as follows:
$m
--------------------------------------------------------------------------------- ------
IAS 19 surplus at 31 December 2022 1.2
Company contributions to the Plan 2.1
Company contributions to the Plan (buy-in premium shortfall) 4.0
Defined benefit pension scheme administration costs (0.5)
Pension finance income 0.1
Re-measurement loss due to changes in assumptions (0.7)
Return on scheme assets (excluding interest income and impact of buy-in policy) (1.5)
Return on scheme assets (in relation to buy-in policy) (4.6)
---------------------------------------------------------------------------------- ------
IAS 19 surplus at 1 July 2023 0.1
---------------------------------------------------------------------------------- ------
The surplus reduced by $1.1m in the period. This was mainly the
result of a negative return on assets in the period and the net
impact of entering the buy-in arrangement discussed above.
The preliminary results of the triennial actuarial valuation of
the Plan as at 30 September 2022 were used as the basis of the 2023
half year IAS 19 valuation. The triennial Plan valuation will be
finalised in the second half of the year.
Cash flow
The Group had cash and bank deposits of $74.5m at 1 July 2023 (2
July 2022: $67.1m; 31 December 2022: $86.8m).
Cash flow in the period is summarised as follows:
Half year Half year
2023 2022
$m $m
----------------------------------------------------- ---------- ----------
Operating profit 63.8 44.0
Share option charges 0.5 0.4
Defined benefit pension scheme administration costs 0.5 0.2
Depreciation and amortisation 2.3 2.0
Lease depreciation 0.9 0.7
Change in working capital 32.7 4.5
Capital expenditure (3.5) (2.4)
----------------------------------------------------- ---------- ----------
Underlying operating cash flow 97.2 49.4
Tax paid (16.5) (9.2)
Net interest received 2.1 (0.1)
Consideration for business combination - (1.7)
Defined benefit pension scheme contributions (2.1) (2.2)
Own share transactions (0.4) (1.0)
Capital element of lease payments (0.7) (0.6)
Exchange and other 1.2 (1.0)
----------------------------------------------------- ---------- ----------
Free cash flow 80.8 33.6
Dividends to Shareholders (93.0) (8.1)
----------------------------------------------------- ---------- ----------
Net cash (outflow)/inflow in the period (12.2) 25.5
----------------------------------------------------- ---------- ----------
The Group generated underlying operating cash flow of $97.2m (H1
2022: $49.4m), a conversion rate of 152% of operating profit. The
high conversion rate is due to the unwinding of the elevated net
working capital position from the 2022 year-end driven by the
significant improvement in supply chain conditions. Capital
expenditure includes investments in our screen-printing operations
(machinery and leasehold improvements) and embroidery machinery
.
Free cash flow improved by $47.2m to $80.8m (H1 2022: $33.6m).
This is attributable to the strong trading performance during the
period and the much-improved net working capital position. The 2022
final and special dividends of $93.0m were paid to Shareholders in
June 2023.
Balance sheet and Shareholders' funds
Net assets at 1 July 2023 were $92.5m, compared to $140.2m at 31
December 2022. The balance sheet is summarised as follows:
1 July 31 December
2023 2022
$m $m
------------------------ ------- ------------
Non-current assets 47.9 46.7
Working capital (16.1) 20.8
Cash and bank deposits 74.5 86.8
Lease liabilities (13.0) (13.7)
Pension asset 0.1 1.2
Other liabilities (0.9) (1.6)
------------------------ ------- ------------
Net assets 92.5 140.2
------------------------ ------- ------------
Shareholders' funds decreased by $47.7m since the 2022 year-end.
The main constituent elements of the change were retained profit in
the period of $49.5m, net of equity dividends paid to Shareholders
of $(93.0)m.
The Group had a net negative working capital balance of $(16.1)m
at 1 July 2023 (31 December 2022: net positive working capital
balance $20.8m). The elevated position at the 2022 year-end
reflected the effects of global and local supply chain issues,
causing build-up of accrued revenue and inventory on orders being
processed. Significant improvements to supply chain conditions in
the period have driven the reduction in the working capital
balance. This normalised net negative position reflects the
strength of our business model, with a high proportion of customers
paying for orders by credit card and the payment of suppliers to
agreed terms.
Financing and liquidity
Full details of the Board's balance sheet funding guidelines and
capital allocation priorities are set out on pages 37 and 38 of the
2022 Annual Report. The Board retains the same guidelines in both
areas.
The primary aim of these guidelines is to provide operational
and financial flexibility through economic cycles, to be able to
invest in opportunities as they arise, and to meet commitments to
Shareholders through dividend payments and residual contributions
to the defined benefit pension plan.
The Group has a $20.0m working capital facility with its
principal US bank, JPMorgan Chase, N.A. The facility has minimum
net income and debt to EBITDA covenants. The interest rate is the
Secured Overnight Financing Rate ("SOFR") plus 1.6%, and the
facility expires on 31 May 2025. In addition, an overdraft facility
of GBP1.0m, with an interest rate of the Bank of England base rate
plus 2.0% (or 2.0% if higher), is available from the Group's
principal UK bank, Lloyds Bank plc, until 31 December 2023.
The Group had cash and bank deposits of $74.5m at the period end
and has no current requirement or plans to raise additional equity
or core debt funding.
Estimates and judgments
The preparation of the consolidated financial statements
requires management to make judgments and estimates that affect the
application of accounting policies, the amounts reported for assets
and liabilities as at the balance sheet date and the amounts
reported for revenues and expenses during the period.
Critical accounting judgments are those judgments, apart from
those involving estimations, that have been made in the process of
applying the Group's accounting policies and that have the most
significant effect on the amounts recognised in the financial
statements. Key assumptions and sources of estimation uncertainty
are those that have a significant risk of resulting in a material
adjustment to the carrying amounts of the Group's assets and
liabilities within the next financial year.
A new critical accounting judgment in relation to the purchase
of the bulk annuity policy (buy-in arrangement) and an update to
the pension assumptions are detailed in note 4 to the interim
condensed consolidated financial statements.
Principal risks and uncertainties
The Board has ultimate responsibility for oversight and
management of risk and control across the Group. The Audit
Committee assists the Board in fulfilling its responsibilities to
maintain effective governance and oversight of the Group's risk
management and internal controls.
Risks are identified on a top-down and bottom-up basis from many
sources, including internally, through the Board and operational
and functional management teams, and externally, to ensure that
emerging risks are considered. Risk identification focuses on those
risks which, if they occurred, have the potential to have a
material impact on the Group and the achievement of its strategic,
operational and compliance objectives. Risks are categorised into
the following groups: strategic risks; operational risks;
reputational risks; and environmental risks.
Management is responsible for evaluating each significant risk
and implementing specific risk mitigation activities and controls
with the aim of reducing the resulting residual risk to an
acceptable level, as determined in conjunction with the Group's
risk appetite. The Business Risk Management Committee reviews the
consolidated Group risk register and the mitigating actions and
controls at regular meetings and provides updates to the Audit
Committee on a bi-annual basis. This process is supplemented with
risk and control assessments completed by the operating locations
and Group function annually.
The current principal risks and uncertainties that would impact
the successful delivery of the Group's strategic goals are set out
on pages 42 to 49 of the 2022 Annual Report, a copy of which is
available on the Group's investor relations website at
https://investors.4imprint.com . These are:
1. Macroeconomic conditions.
2. Markets & competition.
3. Effectiveness of key marketing techniques and brand development.
4. Business facility disruption.
5. Domestic supply and delivery.
6. Failure or interruption of information technology systems and infrastructure.
7. Cyber threats.
8. Supply chain compliance & ethics.
9. Legal, regulatory, and compliance.
10. Climate change.
11. Products and market trends.
These risks have not changed materially since year-end. An
update to the risk environment in respect of the domestic supply
and delivery risk is provided below.
Domestic supply and delivery
Supply chain conditions, initially disrupted by the impact of
the pandemic and later compounded by challenges in the recruitment
of staff by both the Group and our supply partners, have improved
significantly over the period. This has led to shorter order cycle
times, lower order cancellations and a significant reduction to the
elevated year-end working capital position arising from a build-up
of accrued revenue and inventory on orders in process.
Going concern statement
In adopting the going concern basis for preparing these
condensed consolidated financial statements, the Directors have
carefully considered:
-- The Group's strategy, market position and business model, as
set out in the Strategic Report section on pages 9 to 19 of the
2022 Annual Report.
-- The principal risks and uncertainties facing the Group, as
outlined in the Principal risks and uncertainties section of this
Financial Review.
-- Information contained in this Financial Review concerning the
Group's financial position, cash flows and liquidity.
-- Regular management reporting and updates from the Executive Directors.
-- Recent detailed financial forecasts and analysis for the period to 28 December 2024.
Financial position
The Group had cash and bank deposits of $74.5m at 1 July 2023
(31 December 2022: $86.8m) and maintains a $20.0m working capital
facility with its principal US bank, JPMorgan Chase, N.A., which
expires on 31 May 2025, as well as an overdraft facility of GBP1.0m
with its principal UK bank, Lloyds Bank plc, which is available
until 31 December 2023. Based on our forecast, we have no
requirement to draw on either of these facilities.
Financial modelling
We undertake regular forecasting and budgeting exercises which
are reviewed and approved by the Board. On an annual basis and as
described in the Viability statement in the Financial Review
section on pages 38 to 40 of the 2022 Annual Report, we also model
a distressed scenario based upon severe, but plausible, downside
demand assumptions to support our assessment of viability. These
forecasts have demonstrated the Group's ability to flex its
marketing and other costs to mitigate the impact of falls in
revenue, whilst still retaining flexibility to further reduce costs
should the need arise.
Combined with a healthy cash and bank deposits position
maintained in accordance with our balance sheet funding guidelines,
the Board considers the Group to be in a strong position to
withstand severe economic stress and to take market share
opportunities as they arise.
Going concern
Based on their assessment, the Directors have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the
Group's and Company's ability to continue as a going concern over
the period to 28 December 2024. Accordingly, they continue to adopt
the going concern basis in preparing these condensed consolidated
financial statements.
Kevin Lyons-Tarr David Seekings
Chief Executive Officer Chief Financial Officer
9 August 2023
Condensed Consolidated Income Statement
For the 26 weeks ended 1 July 2023
Half
year Half year Full year
2023 2022 2022
Unaudited Unaudited Audited
Note $'000 $'000 $'000
--------------------------- ------- ----------- ----------- ------------
Revenue 6 635,534 515,536 1,140,286
Operating expenses (571,733) (471,553) (1,037,384)
--------------------------- ------- ----------- ----------- ------------
Operating profit 6 63,801 43,983 102,902
Finance income 2,344 108 1,162
Finance costs (245) (205) (425)
Pension finance income 51 27 67
--------------------------- ------- ----------- ----------- ------------
Net finance income/(cost) 2,150 (70) 804
Profit before tax 65,951 43,913 103,706
Taxation 7 (16,488) (10,539) (23,563)
--------------------------- ------- ----------- ----------- ------------
Profit for the period 49,463 33,374 80,143
--------------------------- ------- ----------- ----------- ------------
Cents Cents Cents
--------------------------- ------- ----------- ----------- ------------
Earnings per share
Basic 8 176.23 118.90 285.57
Diluted 8 175.71 118.67 284.95
--------------------------- ------- ----------- ----------- ------------
Condensed Consolidated Statement of Comprehensive Income
For the 26 weeks ended 1 July 2023
Half year Half Full
2023 year year
Unaudited 2022 2022
Unaudited Audited
$'000 $'000 $'000
-------------------------------------------------- ----------- ----------- ---------
Profit for the period 49,463 33,374 80,143
--------------------------------------------------- ----------- ----------- ---------
Other comprehensive income
Items that may be reclassified subsequently
to the income statement:
Currency translation differences 1,452 (1,269) (1,614)
Items that will not be reclassified
subsequently to the income statement:
Return on pension scheme assets (excluding
interest income and impact of buy-in
policy) (1,548) (11,381) (16,374)
Re-measurement loss on buy-in policy
(note 10) (4,591) - -
Re-measurement (losses)/gains on post-employment
obligations (727) 8,201 11,916
Tax relating to components of other
comprehensive income 1,193 560 1,756
Other comprehensive income for the
period, net of tax (4,221) (3,889) (4,316)
--------------------------------------------------- ----------- ----------- ---------
Total comprehensive income for the
period, net of tax 45,242 29,485 75,827
--------------------------------------------------- ----------- ----------- ---------
Condensed Consolidated Balance Sheet
At 1 July 2023
1 July 2 July 31 Dec
2023 2022 2022
Unaudited Unaudited Audited
Note $'000 $'000 $'000
---------------------------------- -------- ---------- ----------- ---------
Non-current assets
Property, plant and equipment 30,791 25,765 29,255
Intangible assets 770 1,002 957
Goodwill 1,010 1,010 1,010
Right-of-use assets 12,256 11,153 13,103
Deferred tax assets 3,034 579 2,381
Retirement benefit asset 10 53 717 1,234
---------------------------------- -------- ---------- -----------
47,914 40,226 47,940
---------------------------------- -------- ---------- ----------- ---------
Current assets
Inventories 18,332 22,726 18,090
Trade and other receivables 81,397 82,030 87,511
Current tax debtor - 1,331 -
Other financial assets - bank
deposits - - 34,913
Cash and cash equivalents 74,540 67,096 51,839
---------------------------------- -------- ---------- ----------- ---------
174,269 173,183 192,353
---------------------------------- -------- ---------- ----------- ---------
Current liabilities
Lease liabilities 11 (1,423) (1,246) (1,435)
Trade and other payables (115,807) (96,981) (84,761)
Current tax creditor (512) - (1,205)
(117,742) (98,227) (87,401)
---------------------------------- -------- ---------- -----------
Net current assets 56,527 74,956 104,952
---------------------------------- -------- ---------- ----------- ---------
Non-current liabilities
Lease liabilities 11 (11,610) (10,370) (12,315)
Deferred tax liabilities (358) (1,022) (357)
(11,968) (11,392) (12,672)
---------------------------------- -------- ---------- ----------- ---------
Net assets 92,473 103,790 140,220
---------------------------------- -------- ---------- ----------- ---------
Shareholders' equity
Share capital 18,842 18,842 18,842
Share premium reserve 68,451 68,451 68,451
Other reserves 5,858 4,751 4,406
Retained earnings (678) 11,746 48,521
---------------------------------- -------- ---------- ----------- ---------
Total Shareholders' equity 92,473 103,790 140,220
---------------------------------- -------- ---------- ----------- ---------
Condensed Consolidated Statement of Changes in Shareholders'
Equity (unaudited)
For the 26 weeks ended 1 July 2023
Retained earnings
--------------------
Share
Share premium Other Own Profit Total
capital reserve reserves shares and loss equity
$'000 $'000 $'000 $'000 $'000 $'000
--------------------------------- --------- --------- ---------- -------- ---------- ---------
Balance at 2 January 2022 18,842 68,451 6,020 (851) (9,496) 82,966
---------------------------------
Profit for the period 33,374 33,374
Other comprehensive income (1,269) (2,620) (3,889)
--------------------------------- --------- --------- ---------- -------- ---------- ---------
Total comprehensive income (1,269) 30,754 29,485
--------------------------------- --------- --------- ---------- -------- ---------- ---------
Proceeds from options exercised 12 12
Own shares utilised 825 (825) -
Own shares purchased (980) (980)
Share-based payment charge 442 442
Dividends (8,135) (8,135)
At 2 July 2022 18,842 68,451 4,751 (1,006) 12,752 103,790
--------------------------------- --------- --------- ---------- -------- ---------- ---------
Profit for the period 46,769 46,769
Other comprehensive income (345) (82) (427)
Total comprehensive income (345) 46,687 46,342
--------------------------------- --------- --------- ---------- -------- ---------- ---------
Proceeds from options exercised 332 332
Own shares utilised 366 (366) -
Own shares purchased (230) (230)
Share-based payment charge 373 373
Deferred tax relating to
share options 52 52
Deferred tax relating to
UK tax losses 148 148
Dividends (10,587) (10,587)
At 31 December 2022 18,842 68,451 4,406 (870) 49,391 140,220
--------- --------- ---------- -------- ---------- ---------
Profit for the period 49,463 49,463
Other comprehensive income 1,452 (5,673) (4,221)
--------------------------------- --------- --------- ---------- -------- ---------- ---------
Total comprehensive income 1,452 43,790 45,242
--------------------------------- --------- --------- ---------- -------- ---------- ---------
Proceeds from options exercised 67 67
Own shares utilised 607 (607) -
Own shares purchased (501) (501)
Share-based payment charge 486 486
Dividends (93,041) (93,041)
Balance at 1 July 2023 18,842 68,451 5,858 (764) 86 92,473
--------------------------------- --------- --------- ---------- -------- ---------- ---------
Condensed Consolidated Cash Flow Statement
For the 26 weeks ended 1 July 2023
Half year Half year Full year
2023 2022 2022
Unaudited Unaudited Audited
Note $'000 $'000 $'000
------------------------------------------- ----- ----------- ----------- ----------
Cash flows from operating activities
Cash generated from operations 12 98,381 49,639 97,040
Tax paid (16,515) (9,151) (20,755)
Finance income received 2,376 108 1,130
Finance costs paid (20) (35) (33)
Lease interest (225) (176) (398)
------------------------------------------- ----- ----------- ----------- ----------
Net cash generated from operating
activities 83,997 40,385 76,984
------------------------------------------- ----- ----------- ----------- ----------
Cash flows from investing activities
Purchases of property, plant and
equipment (3,580) (2,263) (7,719)
Purchases of intangible assets - (179) (341)
Proceeds from sale of property, plant
and equipment 124 3 49
Consideration for business combination - (1,700) (1,700)
Decrease/(increase) in current asset
investments - bank deposits 36,151 - (35,003)
----------
Net cash used in investing activities 32,695 (4,139) (44,714)
------------------------------------------- ----- ----------- -----------
Cash flows from financing activities
Capital element of lease payments (717) (584) (1,225)
Proceeds from share options exercised 67 12 344
Purchases of own shares (501) (980) (1,210)
Dividends paid to Shareholders 9 (93,041) (8,135) (18,722)
------------------------------------------- ----- ----------- ----------- ----------
Net cash used in financing activities (94,192) (9,687) (20,813)
------------------------------------------- ----- ----------- ----------- ----------
Net movement in cash and cash equivalents 22,500 26,559 11,457
Cash and cash equivalents at beginning
of the period 51,839 41,589 41,589
Exchange gains/(losses) on cash and
cash equivalents 201 (1,052) (1,207)
------------------------------------------- ----- ----------- ----------- ----------
Cash and cash equivalents at end
of the period 74,540 67,096 51,839
------------------------------------------- ----- ----------- ----------- ----------
Notes to the Interim Financial Statements
1 General information
4imprint Group plc is a public limited company incorporated in
England and Wales, domiciled in the UK and listed on the London
Stock Exchange. Its registered office is 25 Southampton Buildings,
London, WC2A 1AL.
These interim condensed consolidated financial statements, which
were authorised for issue in accordance with a resolution of the
Directors on 8 August 2023, do not comprise statutory accounts
within the meaning of Section 434 of the Companies Act 2006.
Statutory accounts for the period ended 31 December 2022 were
approved by the Board of Directors on 14 March 2023 and delivered
to the Registrar of Companies. The report of the auditors on those
accounts was unqualified, did not contain an emphasis of matter
paragraph and did not contain any statement under Section 498 of
the Companies Act 2006.
The financial information contained in this report has neither
been audited nor reviewed by the auditors, pursuant to Auditing
Practices Board guidance on Review of Interim Financial
Information.
2 Basis of preparation
These interim condensed consolidated financial statements for
the 26 weeks ended 1 July 2023 have been prepared, in US dollars,
in accordance with the Disclosure and Transparency Rules of the
Financial Conduct Authority and IAS 34 'Interim Financial
Reporting', as adopted by the United Kingdom, and should be read in
conjunction with the Group's financial statements for the period
ended 31 December 2022, which were prepared in accordance with
UK-adopted International Accounting Standards.
As outlined in the Going concern section of the Financial
Review, the Directors consider it appropriate to continue to adopt
the going concern basis in preparing these interim condensed
consolidated financial statements.
The tax charge for the interim period is accrued based on the
best estimate of the tax charge for the full financial year.
3 Accounting policies
The accounting policies applied in these interim condensed
consolidated financial statements are consistent with those
followed in the preparation of the Group's annual consolidated
financial statements for the period ended 31 December 2022, as
described in those annual financial statements. New accounting
standards applicable for the first time in this reporting period
have no impact on the Group's results or balance sheet.
On 20 June 2023 the UK Finance Bill was substantively enacted in
the UK, including legislation to implement the OECD Pillar Two
income taxes for periods beginning on or after 31 December 2023.
The Group has applied the exception in the Amendments to IAS 12
issued in May 2023 and endorsed in July 2023 and has neither
recognised nor disclosed information about deferred tax assets or
liabilities relating to Pillar Two income taxes.
4 Estimates and judgments
The critical accounting judgments and key assumptions and
sources of estimation uncertainty were the same as those applied to
the Group's annual consolidated financial statements for the period
ended 31 December 2022, except for the new critical accounting
judgment in relation to the purchase of a bulk annuity policy and
an update to the pensions assumptions, as detailed below.
Critical accounting judgments
Purchase of a bulk annuity policy
During the period the Trustee of the 4imprint 2016 Pension Plan
(the "Plan") exchanged the existing investment portfolio, including
a further cash lump sum contribution from the Group, for a bulk
purchase annuity policy. This policy funds most of the Plan's
defined benefit obligations (a buy-in policy). This was an
investment decision made in line with the stated objective of
further de-risking the Plan's obligations. The Plan retains the
legal and constructive obligation to pay the benefits and the
Trustee continues to administer the Plan.
Based upon the above, management's judgment was that the
purchase of the policy did not constitute a settlement, as defined
by IAS 19, and the excess of the cost of the annuity over the IAS
19 valuation of the obligations covered has been recorded in other
comprehensive income.
Key assumptions and sources of estimation uncertainty
Pensions
As detailed in note 10, the Group sponsors a defined benefit
pension plan (the "Plan") closed to new members and future accrual.
Most of the obligations of the plan are funded by a bulk purchase
annuity policy, the fair value of which, on an IAS 19 basis,
matches the present value of the obligations being covered.
Period-end valuation of the obligations of the Plan requires a
number of significant actuarial assumptions to be made, including
inflation rate, discount rate and mortality rates. Small changes in
assumptions can have a significant impact on the amounts recorded
in other comprehensive income and on the pension obligations and
annuity asset in the balance sheet. Sensitivities to changes in
these assumptions are disclosed in note 10.
5 Financial risk management
The Group's activities expose it to a variety of financial
risks: currency risk; credit risk; liquidity risk; and capital
risk. These interim condensed consolidated financial statements do
not include all financial risk management information and
disclosures required in the annual financial statements; they
should be read in conjunction with the Group's annual consolidated
financial statements for the period ended 31 December 2022. There
have been no changes in any financial risk management policies
since that date.
6 Segmental analysis
The chief operating decision maker has been identified as the
Board of Directors and the segmental analysis is presented based on
the Group's internal reporting to the Board.
At 1 July 2023, the Group had two operating segments, North
America and UK & Ireland. The costs of the Head Office are
reported separately to the Board, but this is not an operating
segment.
Half Half Full
year year year
2022 2022
2023 $'000 $'000
Revenue $'000
--------------------- -------- -------- ----------
North America 623,797 505,864 1,120,517
UK & Ireland 11,737 9,672 19,769
--------------------- -------- -------- ----------
Total Group revenue 635,534 515,536 1,140,286
--------------------- -------- -------- ----------
Half Half Full
year 2023 year year
2022 2022
Profit $'000 $'000 $000
--------------------------------------------------- ----------- -------- --------
North America 66,290 46,420 107,965
UK & Ireland 31 (132) (54)
--------------------------------------------------- ----------- -------- --------
Operating profit from Direct Marketing operations 66,321 46,288 107,911
Head Office costs (2,520) (2,305) (5,009)
--------------------------------------------------- ----------- -------- --------
Operating profit 63,801 43,983 102,902
Net finance income/(cost) 2,150 (70) 804
--------------------------------------------------- ----------- -------- --------
Profit before tax 65,951 43,913 103,706
--------------------------------------------------- ----------- -------- --------
Other segmental information
Assets Liabilities
---------------------------- ----------------------------------
1 July 2 July 31 Dec 1 July 2 July 31 Dec
2023 2022 2022
$'000 $'000 2022 2023 $'000 2022
$'000 $'000 $'000
--------------- -------- -------- -------- ---------- ---------- ----------
North America 139,678 140,731 146,401 (120,496) (105,346) (95,817)
UK & Ireland 4,381 3,948 3,175 (4,446) (3,798) (3,345)
Head Office 78,124 68,730 90,717 (4,768) (475) (911)
--------------- -------- -------- -------- ---------- ---------- ----------
222,183 213,409 240,293 (129,710) (109,619) (100,073)
--------------- -------- -------- -------- ---------- ---------- ----------
Head Office assets include other financial assets - bank
deposits, cash and cash equivalents, deferred tax assets and the
retirement benefit asset. Head Office liabilities include other
payables and accruals.
7 Taxation
The taxation rate was 25%, based on the estimated rate for the
full year (H1 2022: 24%; FY 2022: 23%). Tax paid in the period was
$16.5m (H1 2022: $9.2m; FY 2022: $20.8m).
The deferred tax assets/liabilities at 1 July 2023 have been
calculated at a tax rate of 25% (19% in respect of deferred tax
items that were expected to reverse before 1 April 2023 for H1 2022
and FY 2022, and 25% in respect of deferred tax items expected to
reverse after 1 April 2023 for H1 2022 and FY 2022) for UK deferred
tax items, and 25% (H1 2022: 25%; FY 2022: 25%) in respect of US
deferred tax items.
8 Earnings per share
Basic and diluted
The basic and diluted earnings per share are calculated based on
the following data:
Half Half Full
year year year
2023 2022 2022
$'000 $'000 $'000
------------------ ------- ------- -------
Profit after tax 49,463 33,374 80,143
------------------ ------- ------- -------
Half Half Full
year year year
2023 2022 2022
Number Number Number
000's 000's 000's
------------------------------------------- ------- ------- -------
Basic weighted average number of shares 28,068 28,070 28,064
Adjustment for employee share options 82 53 61
------------------------------------------- ------- ------- -------
Diluted weighted average number of shares 28,150 28,123 28,125
------------------------------------------- ------- ------- -------
Cents Cents Cents
------------------------------------------- ------- ------- -------
Basic earnings per share 176.23 118.90 285.57
------------------------------------------- ------- ------- -------
Diluted earnings per share 175.71 118.67 284.95
------------------------------------------- ------- ------- -------
The basic weighted average number of shares excludes shares held
in the 4imprint Group plc employee benefit trust. The effect of
this is to reduce the average by 17,444 (H1 2022: 15,931; FY 2022:
21,632).
9 Dividends Half Half Full
year year year
2023 2022 2022
$'000 $'000 $'000
---------------------------------- ------- ------ -------
Dividends paid in the period 93,041 8,135 18,722
---------------------------------- ------- ------ -------
Cents Cents Cents
---------------------------------- ------- ------ -------
Dividends per share
declared - Interim 65.00 40.00 40.00
- Final - - 120.00
- Special - - 200.00
--------------------------------- ------- ------ -------
The interim dividend for 2023 of 65.00c per ordinary share
(interim 2022: 40.00c; final 2022: 120.00c; special 2022: 200.00c)
will be paid on 15 September 2023 to Shareholders on the register
at the close of business on 18 August 2023.
10 Employee pension schemes
The Group operates defined contribution pension schemes for its
UK and US employees. The regular contributions are charged to the
income statement as they are incurred.
The Group also sponsors a UK defined benefit pension scheme (the
"Plan") which is closed to new members and future accrual. The
funds of the scheme are held in trust, administered by a corporate
Trustee, and are independent of the Group's finances.
The preliminary results of the triennial actuarial valuation of
the Plan as at 30 September 2022 have been updated on an
approximate basis to 1 July 2023 in accordance with IAS 19. There
have been no changes in the valuation methodology adopted for this
period's disclosures compared to previous periods' disclosures.
The Plan entered a GBP20.7m buy-in transaction on 27 June 2023
with Legal and General Assurance Society Limited to insure
substantially all remaining pension benefits of the Plan through
the purchase of a bulk annuity policy. The premium of GBP20.7m was
settled by the transfer of the Plan's existing investment portfolio
valued at GBP17.5m and a cash amount of GBP3.2m (c.$4m) paid by the
Group after the date of these interim financial statements in early
July 2023. The difference between the cost of the insurance policy
and the IAS 19 accounting value of the liabilities secured was
GBP3.7m ($4.6m) and has been recorded within other comprehensive
income.
The principal assumptions applied by the actuaries at 1 July
2023 were:
Half Half Full
year year year
2023 2022 2022
----------------------------------------- ------ ------ ------
Rate of increase in pensions in payment 3.12% 3.10% 3.08%
Rate of increase in deferred pensions 2.71% 2.60% 2.66%
Discount rate 5.26% 3.55% 4.82%
Inflation assumption - RPI 3.21% 3.20% 3.16%
Inflation assumption - CPI 2.71% 2.60% 2.66%
----------------------------------------- ------ ------ ------
The mortality assumptions adopted at 1 July 2023 imply the
following life expectancies at age 65:
Half Half Full
year year year
2023 2022 2022
Years Years Years
Male currently aged 45 22.4 22.3 22.3
Female currently aged 45 24.3 24.3 24.2
Male currently aged 65 21.4 21.3 21.3
Female currently aged 65 23.1 23.1 23.1
-------------------------- ------- ------- -------
The movement on the net retirement benefit asset, and the value
of the gross scheme assets and liabilities, are shown in the
Financial Review.
The sensitivities on key actuarial assumptions at the end of the
period were:
Change in defined benefit
Change in assumption obligation
------------------- ----------------------------- --------------------------
Discount rate Decrease of 1.00% +12.9%
Rate of inflation Increase of 1.00% +4.5%
Increase in life expectancy
Rate of mortality of one year +2.8%
------------------- ----------------------------- --------------------------
11 Leases
The Group leases office and industrial space in Oshkosh and
Appleton, Wisconsin. The movement in lease liabilities in the
period is shown below:
Half Full
Half year year year
2023 2022 2022
$'000 $'000 $'000
------------------------------------------ ----------- ------- --------
At start of period 13,750 12,089 12,089
Additions - 111 2,886
Interest charge 225 176 398
Lease interest payments - operating cash
flow (225) (176) (398)
Lease capital payments - financing cash
flow (717) (584) (1,225)
At end of period 13,033 11,616 13,750
------------------------------------------ ----------- ------- --------
12 Cash generated from operations
Half Half Full
year year year
2023 2022 2022
$'000 $'000 $'000
---------------------------------------------------- -------- --------- ---------
Profit before tax 65,951 43,913 103,706
Adjustments for:
Depreciation of property, plant and equipment 2,081 1,757 3,594
Amortisation of intangible assets 189 216 424
Amortisation of right-of-use assets 847 683 1,508
(Profit)/loss on disposal of property, plant
and equipment (118) 3 84
Share option charges 486 442 815
Net finance (income)/cost (2,150) 70 (804)
Defined benefit pension administration charge 470 175 521
Contributions to defined benefit pension
scheme (2,121) (2,202) (4,367)
Changes in working capital:
(Increase)/decrease in inventories (277) (2,167) 2,469
Decrease/(increase) in trade and other receivables 3,803 (18,587) (24,164)
Increase in trade and other payables 29,220 25,336 13,254
Cash generated from operations 98,381 49,639 97,040
---------------------------------------------------- -------- --------- ---------
13 Capital commitments
The Group had capital commitments contracted but not provided
for in these financial statements for property, plant and equipment
of $1.6m (2 July 2022: $4.1m; 31 December 2022: $2.7m).
14 Related party transactions
Transactions and balances between the Company and its
subsidiaries have been eliminated on consolidation. The Group did
not participate in any related party transactions with parties
outside of the Group.
15 Post balance sheet events
On 25 July 2023, the Company issued 87,000 ordinary shares for a
consideration of GBP1.9m to satisfy option exercises under the 2021
US Employee Stock Purchase Plan. Full details of the Company's
share option schemes are given in notes 22 and 23 of the Company's
Annual Report and Accounts 2022.
Alternative Performance Measures
An Alternative Performance Measure ("APM") is a financial
measure of historical or future financial performance, financial
position, or cash flows, other than a financial measure defined or
specified within IFRS.
The Group uses APMs to supplement standard IFRS measures to
provide users with information on underlying trends and additional
financial measures, which the Group considers will aid users'
understanding of the business.
Definitions of the Group's APMs can be found on pages 142 and
143 of the 2022 Annual Report.
Reconciliations of the free cash flow, capital expenditure,
underlying operating cash flow, and cash and bank deposits APMs to
their closest IFRS measures are provided below:
Half
Half year
year 2023 2022
$m $m
------------------------------------------------------- ----------- ------
Net movement in cash and cash equivalents 22.5 26.6
Less: Decrease in current asset investments - bank
deposits (36.1) -
Less: Exchange gain on decrease in current asset
investments - bank deposits 1.2 -
Add back: Dividends paid to Shareholders 93.0 8.1
Add back: Exchange gains on cash and cash equivalents 0.2 (1.1)
------------------------------------------------------- ----------- ------
Free cash flow 80.8 33.6
------------------------------------------------------- ----------- ------
Half
Half year
year 2023 2022
$m $m
----------------------------------------------------- ----------- ------
Purchase of property, plant and equipment (3.6) (2.2)
Purchase of intangible assets - (0.2)
Proceeds from sale of property, plant and equipment 0.1 -
Capital expenditure (3.5) (2.4)
----------------------------------------------------- ----------- ------
Half
Half year
year 2023 2022
$m $m
---------------------------------------------------- ----------- ------
Cash generated from operations 98.4 49.6
Add back: Contributions to defined benefit pension
scheme 2.1 2.2
Add back: Profit on disposal of property, plant
and equipment 0.2 -
Less: Purchases of property, plant and equipment
and intangible assets (3.6) (2.4)
Add back: Proceeds from sale of property, plant
and equipment 0.1 -
Underlying operating cash flow 97.2 49.4
---------------------------------------------------- ----------- ------
1 July 2 July 31 Dec
2023 2022 2022
$m $m $m
---------------------------------------- ------- ------- -------
Cash and cash equivalents 74.5 67.1 51.9
Other financial assets - bank deposits - - 34.9
Cash and bank deposits 74.5 67.1 86.8
---------------------------------------- ------- ------- -------
Statement of Directors' Responsibilities
The Directors confirm that, to the best of their knowledge,
these interim condensed consolidated financial statements have been
prepared in accordance with IAS 34 as adopted by the United Kingdom
and that the interim management report includes a fair review of
the information required by DTR 4.2.7 and 4.2.8, namely:
-- An indication of the important events that have occurred
during the first half of the year and their impact on the interim
condensed consolidated financial statements, and a description of
the principal risks and uncertainties for the remaining six months
of the financial year; and
-- Material related party transactions in the first half of the
year and any material changes in the related party transactions
described in the last annual report.
The Directors of 4imprint Group plc are as listed in the Group's
Annual Report and Accounts 2022.
By order of the Board
Kevin Lyons-Tarr David Seekings
Chief Executive Chief Financial
Officer Officer
9 August 2023
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