TIDMLDSG
RNS Number : 0284R
Leeds Group PLC
24 October 2023
Date: 24 October 2023
Leeds Group plc
("Leeds Group" or "the Group")
Final Results for the year ended 31 May 2023
and Notice of AGM
Leeds Group announces its audited final results of the Group for
the year to 31 May 2023 and that its Annual General Meeting will be
held at 2.15pm on 22 November 2023 at the Radisson Blu Hotel,
Chicago Avenue, Manchester Airport, M30 3RA.
Strategic Report
Chairman's Statement
It has been yet another challenging year for the Group.
The textile markets in Germany and other European countries
have, over the past few years been negatively affected by the
Covid-19 pandemic and the consequences of the Russian armed
aggression in Ukraine. Both situations severely affected consumer
confidence which has now been further impacted by high inflation
and increased interest rates. Margins are low at the commodity end
of the market and it is clear that the market as a whole would
benefit from some degree of consolidation. Against this background,
Group trading has continued to struggle.
As previously communicated it became clear to Hemmers management
last autumn, that its retail subsidiary KMR could not continue to
operate and Hemmers' management made the decision to place it into
an insolvency process, which was accepted by the German Courts on 7
October 2022. The insolvency process is ongoing. Full control
passed to the insolvency administrator on 1 January 2023 and at
that point KMR ceased to be a subsidiary within the Group. However,
Hemmers are still exposed to a loan guarantee in relation to KMR
and this has been provided for in the financial statements.
The Group's focus is now solely to return Hemmers to
profitability. Hemmers management will continue to assess the cost
base to make sure it aligns with the reduced sales levels and look
to make efficiencies wherever they can to ensure Hemmers is as
competitive as it can be in the marketplace. The Directors will
continue to look at all options available to the Group to maximise
shareholder value.
Finance and Operating Review
Group highlights
-- Group revenue for all operations in the year was GBP27,817,000 (2022: GBP29,590,000).
-- Group operating loss was GBP509,000 (2022: loss GBP2,990,000
which included an impairment charge of GBP1,662,000).
-- The interest charge was GBP384,000 (2022: GBP255,000) reflecting higher interest rates.
-- Group loss before tax was GBP893,000 (2022: loss GBP3,245,000).
-- The tax credit in the year was GBP53,000 (2022: charge GBP4,000).
-- Total loss per share was 3.1p (2022: loss per share 11.9p).
Hemmers
Hemmers is an international business engaged in designing,
importing, warehousing, and wholesaling of fabrics from its base in
Germany. The markets in Germany and other European countries have
over the past few years been affected by the Covid-19 pandemic and
the conflict in Ukraine and more recently by high inflation and
high interest rates. Management have made significant reductions in
the cost base and will continue to align costs with sales levels
and look to make efficiencies wherever they can to ensure Hemmers
is as competitive as it can be in the marketplace.
External sales increased slightly in the year to GBP24,290,000
(2022: GBP23,998,000). The gross contribution percentage increased
to 35% (2022: 34%) and the gross profit increased to GBP5,156,000
(2022: GBP4,440,000). Hemmers reported a loss before interest of
GBP248,000 (2022: loss GBP415,000) after exceptional consultancy
charges of GBP403.000. External interest has increased to
GBP337,000 (2022: GBP162,000) due to increased interest rates.
Hemmers bank debt, net of cash, increased in the year to
GBP6,046,000 (2022: GBP5,643,000). The bank debt is secured on the
assets of Hemmers.
KMR
On 7 October 2022, the German Courts accepted Hemmers'
management decision to place its subsidiary KMR into an insolvency
process. As a result of the insolvency, an impairment charge of
GBP1,662,000 was recognised in last year's accounts with the assets
relating to the KMR retail shops being written down to a GBPnil net
book value. Full control passed to the insolvency administrator on
1 January 2023 and at that point KMR ceased to be a subsidiary
within the Group. The results for KMR are only consolidated for the
7 months to 31 December 2022 and are reported as a discontinued
operation in these financial statements.
The loss for the 7-month period before interest for the year was
GBP32,000 (2022: loss GBP2,277,000 for 12 months) and the loss
after interest was GBP79,000 (2022: loss GBP2,370,000). During the
year, KMR's freehold property was sold for GBP521,000 realising a
profit on sale of GBP139,000. The Group made a net gain of
GBP138,000 on the transfer of its assets to the insolvency
administrator.
Fixed Assets
The net book amount of tangible fixed assets is GBP6,487,000
(2022: GBP7,335,000). Capital additions in the year amounted to
GBP51,000 (2022: GBP447,000). During the year, KMR's freehold
property was sold for GBP521,000 realising a profit on sale of
GBP139,000.
The net book value of right-to-use assets is GBP207,000 (2022:
GBP170,000). These relate to car leases, of which there were
GBP142,000 additions during the year (2022: GBP45,000).
Working Capital and Cash Flow
Net debt decreased from GBP6,381,000 to GBP5,812,000 in the
year. Net cash generated in the year at average exchange rates was
GBP1,892,000 (2022: used GBP344,000). Working capital, which
comprises inventories, trade and other receivables and trade and
other payables, decreased in the year by GBP2,239,000 (2022:
increased by GBP1,139,000) mainly due to lower levels of stock as
there was no KMR stock this year. Loan repayments of GBP539,000
(2022: GBP708,000) have been made this year. There were no new
loans taken out in the year (2022: GBP2,835,000).
L ease liability repayments (including interest) of GBP698,000
(2022: GBP1,059,000) were made in the year.
The Group continues to carefully monitor its working capital
requirements to ensure it operates within its current banking
facilities.
Net Asset Value
Net assets decreased in the year by GBP738,000 as follows:
Net assets Per share
GBP000 pence
At 31 May 2022 11,177 40.9
Loss after tax (840) (3.1)
Translation differences 102 0.4
At 31 May 2023 10,439 38.2
Debt Profile
The funding policy of the Group continues to match its funding
requirements in a cost-effective fashion with an appropriate
combination of short and longer-term debt. Property investments
have been financed by long term loans at fixed interest rates
between 1.05% and 1.65%. Working capital finance, when required, is
via short term loans of three months currently attracting interest
at rates of between 1.5% and 3%. Bank debt in the subsidiary is
secured by charges on inventories, receivables and property and is
without recourse to the Parent Company.
Principal risks and uncertainties
The Board has identified the main categories of business risk in
relation to the Group's strategic aims and objectives, and has
considered reasonable steps to prevent, mitigate and manage these
risks. The principal risks identified are as follows:
Funding risk
The Group has a combination of short-term borrowing facilities
and longer-term loan agreements secured on Group assets. The Group
remains dependent upon the support of these funders and there is a
risk that failure in a company to meet banking covenants could have
implications for the Group. Borrowing facilities are monitored
regularly and the facilities agreed are more than needed for the
Group's requirements. The Group has close working relationships
with their current funders but believe alternative banking funders
could be secured if required.
Hemmers has a maximum working capital facility of EUR11m,
restricted to the borrowing base which is calculated as 70% of
eligible inventory and 80% of eligible debtors. In the financial
year 2023, this resulted in average availability of EUR8.4m (2022:
EUR7.7m) with a range of EUR7.2m to EUR10.0m (2022: EUR6.5m to
EUR8.8m) and minimum headroom of EUR1.0m (2022: EUR3.2m) in the
year. In the forecast period to 31 May 2025, the estimated
availability range is EUR7m to EUR8.8m and the minimum headroom
EUR0.3m. The facility is committed until 31 May 2024. Hemmers also
has another working capital facility of EUR1m secured on working
capital which was fully drawn at the year end. The facilities are
uncommitted, but the bank is obliged to give reasonable notice of
any change.
The Directors consider that there will be sufficient headroom
available within the Hemmers working capital facility and,
therefore, the Directors are of the opinion that it is appropriate
to apply the going concern basis of preparation to the financial
statements.
However, the Directors acknowledge that the volatile global
situation could have an impact on the future trading result of
Hemmers and in turn could affect the ability of the Group to meet
its forecasts and therefore comply with banking covenants in
downside scenarios. In addition, the Group has borrowing facilities
which are due for renewal within one year of the date of approval
of these financial statements, which the Group relies on to operate
as a going concern. The Directors will look to renew the existing
facilities when they are due for renewal, although acknowledge the
conditions noted above give rise to a material uncertainty around
the going concern of the Group.
Market risk
There is always the ongoing threat of reduced market demand.
This has been seen this year and the Group continues to strive to
combat the reduced demand by looking at other markets both
domestically and internationally and looking at expanding its
product ranges. The commercial risks of operating in the highly
competitive European fabric market are limited by the fact that
Hemmers has a wide range of suppliers, and no customer accounts for
more than 5% of revenues.
Foreign exchange risk
Most fabric purchased by Hemmers is paid for in US dollars,
while the Euro is the principal currency in which Hemmers sells its
product. The Euro/dollar rate is of greater significance to Leeds
Group than the strength of Sterling. The Hemmers' management
continue to manage this transactional currency risk by a
combination of forward exchange contracts with reputable banks and
sales price increases where necessary.
Audit Opinion
As set out in note 7 of this announcement below, the Independent
Auditor's Report on the Annual Report and Financial Statements for
the year ended 31 May 2023 was qualified on the basis that they
were unable to obtain sufficient audit evidence in respect of the
subsidiary KMR and its performance, as stated within the
Consolidated Statement of Comprehensive Income under discontinued
operations. Except for the qualification noted above the
Independent Auditor's Report on the Annual Report and Financial
Statements for the year ended 31 May 2023 did not contain a
statement under section 498(2) of the Companies Act 2006 or section
498(3).
In auditing the financial statements for the year ended 31 May
2023, the Group Auditors have concluded that the Directors' use of
the going concern basis of accounting in the preparation of the
financial statements is appropriate. However, the Independent
Auditor's Report draws attention to note 2 in the Group financial
statements (note 1 of this announcement below) which states that
the Group and Parent Company incurred substantial losses during the
year and that the Group and Parent Company's operational existence
is dependent on the continued support from the Group's bank
facilities and the eventual return to profitability. The impact of
this gives rise to a material uncertainty around the going concern
of the Group. The auditor's opinion is unqualified and not modified
in respect of this matter.
The strategic report was approved by the Board of Directors on
23 October 2023 and signed on its behalf by:
Jan G Holmstrom
Non-Executive Chairman
Consolidated Statement of Comprehensive Income
for the year ended 31 May 2023
Year ended 31 May 2023 Year ended 31 May 2022
Discontinued Continuing Total Discontinued Continuing Total
operations operations operations operations
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Revenue 3,527 24,290 27,817 5,592 23,998 29,590
Cost of sales (3,249) (19,134) (22,383) (4,551) (19,570) (24,121)
Gross profit 278 5,156 5,434 1,041 4,428 5,469
Distribution costs (690) (1,513) (2,203) (1,082) (1,401) (2,483)
Impairment of assets
Gain on discontinued
operations Administrative
costs - - - (1,662) - (1,662)
138 - 138 - - -
225 (4,274) (4,049) (606) (3,855) (4,461)
Total administrative
costs 363 (4,274) (3,911) (2,268) (3,855) (6,123)
Other income 17 154 171 32 115 147
Loss from operations (32) (477) (509) (2,277) (713) (2,990)
Finance expense (47) (337) (384) (93) (162) (255)
Loss before tax (79) (814) (893) (2,370) (875) (3,245)
Tax credit/(charge) - 53 53 - (4) (4)
Loss for the year
attributable to the
equity holders of
the Parent Company (79) (761) (840) (2,370) (879) (3,249)
Other comprehensive
profit/(loss)
Translation differences
on foreign operations 15 87 102 (22) (113) (135)
Total comprehensive
loss for the year
attributable to the
equity holders of
the Parent Company (64) (674) (738) (2,392) (992) (3,384)
There is no tax effect relating to other comprehensive
income/(loss) for the year. Amounts included in other comprehensive
income/(loss) may be reclassified subsequently as profit or
loss.
Loss per share attributable to the equity holders of the
Company
Year ended Year ended
31 May 2023 31 May 2022
Basic and diluted total loss per
share (pence) 3.1p 11.9p
Consolidated Statement of Financial Position
at 31 May 2023
31 May 2023 31 May 2022
GBP000 GBP000
Assets
Non-current assets
Property, plant, and equipment 6,487 7,335
Right-of-use assets 207 170
Intangible assets 46 52
Total non-current assets 6,740 7,557
Current assets
Inventories 8,218 11,994
Trade and other receivables 3,199 2,864
Tax recoverable - 13
Cash on demand and on short term deposit 234 471
Total current assets 11,651 15,342
Total assets 18,391 22,899
Liabilities
Non-current liabilities
Loans and borrowings (544) (836)
Lease liabilities (112) (1,165)
Total non-current liabilities (656) (2,001)
Current liabilities
Trade and other payables (1,353) (3,065)
Loans and borrowings (5,502) (5,671)
Lease liabilities (97) (885)
Provisions (344) (100)
Total current liabilities (7,296) (9,721)
Total liabilities (7,952) (11,722)
TOTAL NET ASSETS 10,439 11,177
Capital and reserves attributable to
equity holders of the Company
Share capital 3,279 3,279
Capital redemption reserve 1,113 1,113
Foreign exchange reserve 2,152 2,050
Retained earnings 3,895 4,735
TOTAL EQUITY 10,439 11,177
The financial statements were approved and authorised for issue
by the Board of Directors on 23 October 2023 and were signed on
behalf of the Board by:-
Jan G Holmstrom
Non-Executive Chairman
Consolidated Cash Flow Statement
for the year ended 31 May 2023
Year ended Year ended
31 May 2023 31 May 2022
GBP000 GBP000
Cash flows from operating activities
Loss for the year (840) (3,249)
Adjustments for:
Government assistance credit (59) (119)
Depreciation of property, plant, and
equipment 608 735
Impairment of property, plant, and equipment - 42
Depreciation of right-of-use assets 103 827
Impairment of right-of-use assets - 1,620
Amortisation of intangible assets 6 5
Finance expense - interest on bank loans 347 179
Finance expense - interest lease liabilities 37 76
Gain on sale of property, plant, and
equipment (142) -
Loss on sale of right-of-use assets 3 -
Gain on discontinued operations (138) -
Tax (credit)/charge (53) 4
Cash from operating activities before
changes in working capital and provisions (128) 120
Decrease/(increase) in inventories 2,744 (1,818)
(Increase) in trade and other receivables (404) (43)
(Decrease)/increase in trade and other
payables (101) 722
Cash generated from/(used in) operating
activities 2,111 (1,019)
Tax (paid)/received (32) 114
Net cash flows generated from/(used
in) operating activities 2,079 (905)
Investing activities
Purchase of property, plant, and equipment (51) (447)
Proceeds from the sale of fixed assets 521 -
Net cash generated from/(used in) investing
activities 470 (447)
Financing activities
Bank borrowings drawn - 2,835
Bank borrowing disposed of 868 -
Bank borrowings repaid (539) (708)
Repayment of principal on lease liabilities (661) (983)
Repayment of interest on lease liabilities (37) (76)
Bank interest paid (347) (179)
Government assistance received 59 119
Net cash (used in)/generated from financing
activities (657) 1,008
Net increase/(decrease) in cash and
cash equivalents 1,892 (344)
Translation loss on cash and cash equivalents (3) (2)
Cash and cash equivalents at the beginning
of the year 126 472
Cash and cash equivalents disposed of (1,781) -
Cash and cash equivalents at the end
of the year 234 126
Cash on demand or on short term deposit 234 471
Bank overdrafts - (345)
Cash and cash equivalents at the end
of the year 234 126
Consolidated Statement of Changes in Equity
for the year ended 31 May 2023
Share Capital Foreign Retained Total
capital redemption exchange earnings equity
reserve reserve
GBP000 GBP000 GBP000 GBP000 GBP000
At 31 May 2021 3,279 1,113 2,185 7,984 14,561
Loss for the year - - - (3,249) (3,249)
Other comprehensive loss - - (135) - (135)
Total comprehensive loss - - (135) (3,249) (3,384)
At 31 May 2022 3,279 1,113 2,050 4,735 11,177
Loss for the year - - - (840) (840)
Other comprehensive income - - 102 - 102
Total comprehensive income/(loss) - - 102 (840) (738)
At 31 May 2023 3,279 1,113 2,152 3,895 10,439
The following describes the nature and purpose of each reserve
within equity:
Reserve Description and purpose
Share capital The nominal value of issued ordinary shares
in the Company.
Capital redemption reserve Amounts transferred from share capital on
redemption of issued shares.
Treasury share reserve Cost of own shares held in treasury.
Foreign exchange reserve Gains/(losses) arising on retranslation of
the net assets of overseas operations into
sterling.
Retained earnings Cumulative net gains/(losses) recognised
in the consolidated statement of comprehensive
income after deducting the cost of cancelled
treasury shares.
Notes
1. Basis of preparation
The Group financial statements have been properly prepared using
the recognition and measurement principles of United Kingdom
adopted International Financial Reporting Standards ("UK adopted
IFRS").
Going Concern
When considering its opinion about the application of the going
concern basis of preparation of the financial statements the
Directors have given due consideration to:
-- The performance of the Group in the last financial year and
the robustness of forecasts for the next 24 months, which return
the Group to profit.
-- The financing facilities available to the Group and the
circumstances in which these could be limited or withdrawn.
Financial performance and forecasts
Forecasts have been prepared for the 24-month period to May 2025
which indicate a return to modest profit over that period. The
Company has sensitised these forecasts for a reduction in revenues
for Hemmers and the banking facilities remain adequate. The
Directors are of the opinion that this is a reasonable worst case,
and the currently available facilities would be sufficient in this
scenario.
For purposes of the going concern assessment, the Group make
estimates of likely future cash flows which are based on
assumptions given the uncertainties involved. The key assumptions
include (i) No significant deterioration in general market
conditions; (ii) No significant customer loss; (iii) No significant
increase in raw material prices (iii) Continued support of lenders.
These assumptions are made by management based on recent
performance, external forecasts and management's knowledge and
expertise of the cashflow drivers. Management continually monitors
the Group's cash balances and forecasts cash flows, including
stress testing in respect of the timing of those cash flows.
Financing facilities
The operating business of the Group, Hemmers which is located in
Germany. The Parent Company, which has no borrowing facilities, is
located in the UK. Hemmers has four sources of funding:
-- Term loans which have funded property purchases. These are
repayable in instalments over the term as detailed in note 6. They
are secured over the associated properties and that security could
be called in the event that the business defaulted on
repayment.
-- A maximum working capital facility of EUR11m, restricted to
the borrowing base which is calculated as 70% of eligible inventory
and 80% of eligible debtors. In the financial year 2023, this
resulted in average availability of EUR8.4m (2022: EUR7.7m) with a
range of EUR7.2m to EUR10.0m (2022: EUR6.5m to EUR8.8m) and minimum
headroom of EUR1.0m (2022: EUR3.2m) in the year. In the forecast
period to 31 May 2025, the estimated availability range is EUR7m to
EUR8.8m and the minimum headroom EUR0.3m. The covenants on this
facility are an equity ratio which must exceed 50% of gross assets
at the financial year end and profit for the previous six months to
exceed EUR121,000. At 31 May 2023, the ratio was 52% and the
previous six months profit was EUR347,000. The facility is
committed until 31 May 2024.
-- A further working capital facility of EUR1m secured on
working capital which was fully drawn at the year end. The
facilities are uncommitted, but the bank is obliged to give
reasonable notice of any change.
-- A EUR3m Parent Company loan which is currently subordinated to the working capital facility.
The Directors consider there will be sufficient headroom
available in the Hemmers working capital facility and, therefore,
the Directors are of the opinion that it is appropriate to apply
the going concern basis of preparation to the financial
statements.
However, the Directors acknowledge that the volatile global
situation could have an impact on the future trading result of
Hemmers and in turn could affect the ability of the Group to meet
its forecasts and therefore comply with banking covenants in
downside scenarios. In addition, the Group has borrowing facilities
which are due for renewal within one year of the date of approval
of these financial statements, which the Group relies on to operate
as a going concern. The Directors will look to renew the existing
facilities when they are due for renewal, although acknowledge the
conditions noted above give rise to a material uncertainty around
the going concern of the Group.
2. Dividends
The Directors do not recommend the payment of a dividend in 2023
(2022: GBPnil).
3. Loss per share
Year ended 31 May 2023
Loss per share Discontinued Continuing
Total
operations operations Group
Numerator
Total loss for the year GBP79,000 GBP761,000 GBP840,000
Denominator
Weighted average number of shares 27,320,843 27,320,843 27,320,843
Basic and diluted loss per share 0.3p 2.8p 3.1p
Year ended 31 May 2022
Loss per share Discontinued Continuing
Total
operations operations Group
Numerator
Total loss for the year GBP2,370,000 GBP879,000 GBP3,249,000
Denominator
Weighted average number of shares 27,320,843 27,320,843 27,320,843
Basic and diluted loss per share 8.7p 3.2p 11.9p
Since there are no outstanding share options, there is no
difference between basic and diluted earnings per share.
4. Discontinued operations
On 7 October 2022, the German Courts accepted Hemmers'
management decision to place its subsidiary KMR into an insolvency
process. The insolvency process is ongoing although full control
passed to the insolvency administrator on 1 January 2023 and at
that point KMR ceased to be a subsidiary within the Group. The gain
has arisen due to the assets being transferred to the insolvency
administrator and any IFRS adjustments reversed. There was no tax
impact on the gain which arose on transfer.
KMR balance IFRS adj Total
sheet at insolvency
date GBP000 GBP000
GBP000
Fixed assets (136) 133 (3)
Current assets less current
liabilities 254 (213) 41
Finance lease liability - 1,360 1,360
Provision - (347) (347)
118 933 1,051
Cash (1,781) - (1,781)
Loan 868 - 868
Net cash effect (913) - (913)
(Loss)/gain on transfer (795) 933 138
5. Segmental information
Year ended 31 May Discontinued Continuing operations Total
2023 operations
KMR Hemmers Inter Parent Group
segmental Company
GBP000 GBP000 GBP000 GBP000 GBP000
External revenue 3,527 24,290 - - 27,817
Inter-segmental revenue 3 416 (419) - -
Cost of sales (3,252) (19,550) 419 - (22,383)
Gross profit 278 5,156 - - 5,434
Distribution costs (690) (1,513) - - (2,203)
Admin expenses 363 (4,171) 127 (229) (3,911)
Other income 17 280 (127) - 171
Operating loss (32) (248) - (229) (509)
Finance expense (47) (337) - - (384)
Internal interest - (208) - 208 -
Loss before tax (79) (793) - (21) (893)
At 31 May 2023 Discontinued Continuing operations Total
operations
KMR Hemmers Adj Parent Group
Company
GBP000 GBP000 GBP000 GBP000 GBP000
Total assets - 15,572 - 2,819 18,391
Total liabilities - (7,852) - (100) (7,952)
Total net assets - 7,720 - 2,719 10,439
Year ended 31 May Discontinued Continuing operations Total
2022 operations
KMR Hemmers Inter Parent Group
segmental Company
GBP000 GBP000 GBP000 GBP000 GBP000
External revenue 5,592 23,998 - - 29,590
Inter-segmental revenue - 1,069 (1,069) - -
Cost of sales (4,551) (20,627) 1,057 - (24,121)
Gross profit/(loss) 1,041 4,440 (12) - 5,469
Distribution costs (1,082) (1,401) - - (2,483)
Admin expenses (2,268) (3,763) 194 (286) (6,123)
Other income 32 309 (194) - 147
Operating loss (2,277) (415) (12) (286) (2,990)
Finance expense (93) (162) - - (255)
Internal interest - (204) - 204 -
Loss before tax (2,370) (781) (12) (82) (3,245)
At 31 May 2022 Discontinued Continuing operations Total
operations
KMR Hemmers Adj Parent Group
Company GBP000
GBP000 GBP000 GBP000 GBP000
Total assets 2,819 17,392 (123) 2,811 22,899
Total liabilities (3,540) (8,091) - (91) (11,722)
Total net (liabilities)/assets (721) 9,301 (123) 2,720 11,177
6. Loans and borrowings
The book value of loans and borrowings are as follows:
31 May 2023 31 May
GBP000 2022
GBP000
Current
Secured bank loans 5,502 5,671
Non - current
Secured bank loans 544 836
Total loans and borrowings 6,046 6,507
Current loans and borrowings
At 31 May 2023 current loans and borrowings of GBP5,502,000
(2022: GBP5,671,000) comprise short term loans of GBP5,201,000
(2022: GBP5,373,000) and instalments due on long term loans
detailed below of GBP301,000 (2022: GBP298,000). The interest rate
on the short-term loans ranges from 1.5% to 3% (2022: 1.25% to 3%)
and these loans are secured on working capital of Hemmers. The
short-term loans are drawn down by Hemmers against short-term
borrowing facilities of up to a maximum of GBP10.3m (EUR12m). At 31
May 2023, the total borrowing facility available totalled GBP7.1m
(EUR8.2m) of which GBP5.2m (EUR6m) has been utilised including any
overdrafts, therefore the headroom within the facility was GBP1.9m
(EUR2.2m). Neither the Parent Company nor its subsidiary Hemmers
have any other borrowing facilities. The bank borrowing facilities
are reviewed annually every May and remain in place for Hemmers for
the forthcoming year.
Non-current loans and borrowings
Non-current loans were drawn down in 2016 and 2017 to finance
developments at the Hemmers warehouses in Nordhorn.
The Group's loans and borrowings are within the accounts of
Hemmers. They are denominated in Euros, and their principal terms
are as follows:
Fixed Repayment Final repayment 31 May 31 May
interest profile date 2023 2022
rate GBP000 GBP000
Loan September
1 1.65% Equal quarterly instalments 2025 358 590
Loan
2 1.05% Equal quarterly instalments March 2026 186 246
Non-current loans 544 836
7. Other information
The financial information in this financial results announcement
has been prepared by the Directors using the recognition and
measurement principles of United Kingdom adopted International
Financial Reporting Standards ("UK adopted IFRS"). The financial
information for the year ended 31 May 2023 does not constitute the
statutory accounts of the Company for 2022 and 2023 but are
extracted from the audited accounts.
The statutory accounts for the year ended 31 May 2023 and 31 May
2022 have been reported on by MHA, Statutory Auditor. The
Independent Auditor's Report on the Annual Report and Financial
Statements for 2023 is qualified and for 2022 unqualified and did
not draw attention to any matters by way of emphasis. Both the
Financial Statements for 2023 and 2022 did not contain a statement
under 498(2) or 498(3) of the Companies Act 2006. The Independent
Auditor's Report on the Annual Report and Financial Statements for
the year ended 31 May 2023 was qualified on the basis that they
were unable to obtain sufficient audit evidence in respect of the
subsidiary KMR and its performance, as stated within the
Consolidated Statement of Comprehensive Income under discontinued
operations. Except for the qualification noted above the
Independent Auditor's Report on the Annual Report and Financial
Statements for the year ended 31 May 2023 did not contain a
statement under section 498(2) of the Companies Act 2006 or section
498(3).
In auditing the financial statements for the year ended 31 May
2023, the Group Auditors have concluded that the Directors' use of
the going concern basis of accounting in the preparation of the
financial statements is appropriate. However, the Independent
Auditor's Report draws attention to note 2 in the Group financial
statements (note 1 above) which states that the Group and Parent
Company incurred substantial losses during the year and that the
Group and Parent Company's operational existence is dependent on
the continued support from the Group's bank facilities and the
eventual return to profitability. The impact of this gives rise to
a material uncertainty around the going concern of the Group. The
auditor's opinion is unqualified and not modified in respect of
this matter. An extract from the Independent Auditor's Report is
set out below:
We draw your attention to note 2 in the financial statements
which states that the Group and Parent Company incurred substantial
losses during the year and that the Group and Parent Company's
operational existence is dependent on the continued support from
the Group's bank facilities and the eventual return to
profitability.
The impact of this together with other matters set out in the
note, indicate that a material uncertainty exists that may cast
significant doubt on the Group's ability to continue as a going
concern. Our opinion is not modified in respect of this matter. In
auditing the financial statements, we have concluded that the
Directors' use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our
evaluation of the Directors' assessment of the Group and Parent
Company's ability to continue to adopt the going concern basis of
accounting included:
Our evaluation of the Directors' assessment of the Group's and
the Parent Company's ability to continue to adopt the going concern
basis of accounting included:
-- The consideration of inherent risks to the Group's operations
and specifically its business model.
-- The evaluation of how those risks might impact on the Group's
available financial resources.
-- Review of the mathematical accuracy of the cashflow forecast
model prepared by management and corroboration of key data inputs
to supporting documentation for consistency of assumptions used
with our knowledge obtained during the audit.
-- Challenging management for reasonableness of assumptions in
respect of the timing and quantum of cash receipts and payments
included in the cash flow model.
-- Holding discussions with management regarding future
financing plans, corroborating these where necessary and assessing
the impact on the cash flow forecast.
-- Review of the Group's external debt exposure to determine if
any future repayments have been included within the Group's cash
flow projections.
-- Holding discussions with management and completing reviews of
any events after the reporting period to identify if these may
impact on the Group's ability to continue as a going concern.
The statutory accounts for the year ended 31 May 2022 have been
filed with the Registrar of Companies. The statutory accounts for
the year ended 31 May 2023 will be delivered to the Registrar of
Companies following the Annual General Meeting. The Annual Report
and Financial Statements giving notice of the 2023 Annual General
Meeting, have been today published on the Group's website at
www.leedsgroup.plc.uk and have been sent to those shareholders who
have elected to receive a hard copy of the Annual Report and
Financial Statements by the post.
The Annual General Meeting will be held at 2.15pm on 22 November
2023 at the Radisson Blu Hotel, Chicago Avenue, Manchester Airport,
M30 3RA.
This announcement contains inside information for the purposes
of the UK Market Abuse Regulation and has been arranged for release
by Jan G Holmstrom, Non-Executive Chairman. The Directors of the
Company are responsible for the release of this announcement.
Enquiries:
Leeds Group plc Cairn Financial Advisers LLP (nominated
adviser)
Dawn Henderson - 01937 547877 Liam Murray/Sandy Jamieson - 020
7213 0880
Note:
Certain statements made in this announcement are forward-looking
statements. These forward-looking statements are not historical
facts but rather are based on the Company's current expectations,
estimates, and projections about its industry; its beliefs; and
assumptions. Words such as 'anticipates,' 'expects,' 'intends,'
'plans,' 'believes,' 'seeks,' 'estimates,' and similar expressions
are intended to identify forward-looking statements. These
statements are not a guarantee of future performance and are
subject to known and unknown risks, uncertainties, and other
factors, some of which are beyond the Company's control, are
difficult to predict, and could cause actual results to differ
materially from those expressed or forecasted in the
forward-looking statements. The Company cautions security holders
and prospective security holders not to place undue reliance on
these forward-looking statements, which reflect the view of the
Company only as of the date of this announcement. The
forward-looking statements made in this announcement relate only to
events as of the date on which the statements are made. The Company
will not undertake any obligation to release publicly any revisions
or updates to these forward-looking statements to reflect events,
circumstances, or unanticipated events occurring after the date of
this announcement except as required by law or by any appropriate
regulatory authority.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
FR FLFVAIELVFIV
(END) Dow Jones Newswires
October 24, 2023 02:05 ET (06:05 GMT)
Leeds (LSE:LDSG)
Historical Stock Chart
From Apr 2024 to May 2024
Leeds (LSE:LDSG)
Historical Stock Chart
From May 2023 to May 2024
