TIDMSHI
RNS Number : 4149T
SIG PLC
25 March 2021
25 March 2021
SIG plc
Full year results for the year ended 31 December 2020
Return to Growth strategy on track
SIG plc ("SIG", "the Group" or "the Company") announces its
results for the full year ended 31 December 2020 ("FY 2020" or "the
period").
Strategic highlights
-- Return to Growth strategy delivering to plan:
o UK business rebuilt and relaunched
o Reconnection with customers, suppliers and employees well
advanced
-- Strong finish to 2020, ahead of expectations; like-for-like
sales up 4% in Q4, reflecting broad-based growth across all major
markets, including the UK
-- Significantly strengthened balance sheet provides confidence
to invest in new growth strategy and security against short term
market uncertainty
-- Group continues to adapt successfully to trade safely to new
Covid-19 norms, working closely and flexibly with our employees,
customers and suppliers
Financial results
-- Full year like-for-like sales down 13%, with a solid recovery in the second half
-- Underlying gross margin down 80bps due to lower sales volumes over the year
-- Underlying operating loss of GBP53.3m (2019: GBP42.5m profit); better than previous guidance
-- Underlying loss before tax of GBP76.3m (2019: GBP17.7m profit
before tax), with statutory loss before tax from continuing
operations of GBP202.3m (2019: GBP112.7m loss before tax),
reflecting GBP126.0m of Other items, including GBP76.1m of
impairment charges in the UK business and GBP13.2m onerous contract
costs
-- Net debt, pre IFRS 16, down to GBP4.1m (2019: GBP162.8m),
helped by the sale of Air Handling division in January and GBP152m
capital raise in July; post IFRS 16 net debt down to GBP238.2m
(2019: GBP455.4m)
Current trading and outlook
-- Trading in 2021 to date is in line with management
expectations, continuing on a similar trajectory to Q4 2020
-- Market fundamentals remain strong; good RMI growth in UK and France
-- UK Distribution structure in place; revenue growth starting to emerge as planned
-- Continued uncertainty remains regarding Covid-19
-- Return to profitability and cash generation expected in H2
-- Company reaffirms medium term financial goals
Commenting, Steve Francis, Chief Executive Officer, said:
"Our teams have shown great resilience and commitment in the
face of the challenging circumstances for much of the year, the
effects of which clearly impacted our first half, and hence full
year, results. Providing a safe environment and instilling an even
greater focus on good health and safety behaviours has been and
will remain a major focus of the new management team.
"I am delighted that due to our Return to Growth strategy we
delivered a solid second half and have begun to return the business
to growth after a long period of decline. On behalf of the whole
Board I would like to thank all our employees for their significant
efforts, and successes, during the year.
"The new UK management team has rebuilt its business and,
everywhere we operate, we have reconnected with our employees,
customers and suppliers. Their response has reaffirmed that we are
at our best when we are a local, sales and technical service-driven
business, partnering closely with our key suppliers and operating
with empowered and entrepreneurial branch teams. That is our
strategy for growth and the basis for playing a leading role in our
industry in the years to come.
"This, coupled with a strong balance sheet, gives us the right
foundations for the business to grow."
Underlying operations(1) 2020 2019 Change
------------ ------------ ---------
Revenue GBP1,872.7m GBP2,143.0m (12.6)%
LFL (2) sales (13.3)% (7.4)% (590)bps
Gross margin 25.1% 25.9% (80)bps
Underlying(3) operating (loss)/profit (GBP53.3)m GBP42.5m
Underlying(3) (loss)/profit
before tax (GBP76.3)m GBP17.7m
Underlying(3) (loss)/earnings
per share (10.0)p 0.2p (10.2)p
Operating margin (2.8)% 2.0% (480)bps
Net debt GBP238.2m GBP455.4m 47.7%
Net debt (pre IFRS 16) GBP4.1m GBP162.8m 97.5%
------------ ---------
Statutory results 2020 2019
--------------------------------------- ------------ ------------
Revenue(4) GBP1,874.5m GBP2,160.6m
Operating loss(4) (GBP167.7)m (GBP87.9)m
Loss before tax(4) (GBP202.3)m (GBP112.7)m
Basic loss per share(4) (24.0)p (21.0)p
Total loss after tax (5) (GBP139.2)m (GBP124.5)m
Dividend per share n/d 1.25p
--------------------------------------- ------------ ------------
1.Underlying operations excludes businesses divested or closed,
or which the Board has resolved to divest or close by 24 March
2021.
2. Like-for-like ("LFL") is defined as sales per working day in
constant currency excluding acquisitions and disposals completed or
agreed in the prior year, or before announcement of the Group's
results for the relevant period. Sales are not adjusted for branch
openings or closures. 2019 LFL sales differ from the prior year
results due to the reclassification of non-core businesses.
3. Underlying represents the results before Other items and have
been disclosed separately in order to give an indication of the
underlying earnings of the Group. Further details are disclosed in
Note 3.
4. Statutory results of Continuing operations only.
5. Statutory results including both Continuing and Discontinued
operations.
Investor and Analyst presentation (9am today)
A webcast of the Group's briefing for analysts and investors
will take place today at 9am, a recording of which will also be
available later in the day on the investor page of the Company's
website, www.sigplc.com .
Please click this URL to join:
https://storm-virtual-uk.zoom.us/j/83576636099
Or join by phone:
United Kingdom: +44 203 481 5240 / +44 203 901 7895 / +44 131
460 1196 / +44 203 051 2874 /
+44 203 481 5237
Webinar ID: 835 7663 6099
International numbers available:
https://storm-virtual-uk.zoom.us/u/kbeLX0IBeh
LEI: 213800VDC1BKJEZ8PV53
Enquiries
SIG plc +44 (0) 114 285 6300
Steve Francis Chief Executive Officer
Ian Ashton Chief Financial Officer
FTI Consulting +44 (0) 20 3727 1340
Richard Mountain
Peel Hunt LLP - Joint broker to SIG +44 (0) 20 7418 8900
Mike Bell / Charles Batten
Jefferies International Limited - Joint
broker to SIG +44 (0) 20 7029 8000
Ed Matthews / Will Soutar
About
SIG plc is a leading European supplier of specialist building
solutions to trade customers across the UK, France, Germany,
Ireland, Benelux and Poland. As a distributor of insulation and
interiors products and merchant of roofing and exteriors products,
SIG facilitates one-stop access to an extensive product range,
provides expert technical advice and coordinates often complex
delivery requirements. For suppliers, SIG offers a channel through
which products can be brought to a highly fragmented market of
smaller customers and sites that are of insufficient scale to
supply direct. SIG employs approximately 6,500 employees across
Europe and is listed on the London Stock Exchange (SHI). For more
information, please visit the Company's website, www.sigplc.com
.
Strategy update
On 29 May, the Grou p launched its Return to Growth strategy.
The restructuring of its debt facilities and the successful capital
raise provide firm and stable foundations for this strategy to be
delivered. Fundamental to the new strategy is the recognition that
SIG is a sales-led organisation, where the ability to grow its
customer base through the provision of high levels of customer
service, deep technical expertise and disciplined pricing are
critical. The establishment of strong customer relationships, by
empowering and energising key account and branch teams, and
promoting an entrepreneurial spirit throughout the company's
extensive branch network, is key to this objective.
The implementation of the strategy is now well underway. In the
UK, where the Group's operational and financial performance had
seen greatest deterioration, the new strategy is initially focusing
on de-centralising accountability to branch level and upgrading
operational processes, systems and controls to provide the
appropriate platform from which market share can be recaptured and
profitable growth restored. In the EU businesses, where the Group's
operational and financial performance has in general been more
stable, the new strategy is empowering the Group's operating
companies to move onto a growth footing.
Through the implementation of this strategy, supported by the
strengthened balance sheet and strong leadership teams now in place
across the organisation, the Board is confident that the Group will
return to sustainable and long term profitable growth and achieve
its vision of being the leading B2B supplier of specialist
construction products and solutions in the markets in which it
operates.
The delivery of these strategic objectives will, in turn, enable
the Group to achieve its key stated medium term financial goals,
being:
-- A Group operating margin of approximately 3%, trending
towards approximately 5% in the longer term; underpinned by target
operating margin of approximately 5% within the Group's operating
companies
-- Leverage of <1.5x (pre IFRS 16 basis)
-- A progressive dividend covered 2.0-3.0x by underlying earnings
Market share recapture plan
The G ro up's market share recapture plan, particularly for its
UK businesses, Distribution and Exteriors, as well as for its
Germany and Benelux businesses, is built upon some key
enablers.
Merger of leadership of UK Distribution and Exteriors
The UK's Distribution and Exteriors businesses have now been
merged to create a single UK division, with a combined leadership
team replicating the model already successfully deployed in SIG
France, which will leverage potential synergies in support
functions whilst maintaining separate commercial organisations and
footprints (primarily branches). The new regional structure of the
combined UK business is focusing on promoting local
entrepreneurship, accountability and P&L account
responsibility.
More expansive growth strategy
As par t of the Return to Growth strategy, the Group has
commenced a review to refine the definitions of its marketplace and
thereby revise and expand the definition of "core" business. This
is designed to facilitate the development of a more expansive
growth strategy in each of the Group's countries of operation. The
Company expects this review to highlight opportunities, consistent
with the Group's USPs (Expertise, Proximity, Service), to widen its
product offering and expand its geographic coverage in areas where
the greatest returns can be realised.
Energise sales, market share recovery and growth efforts
The Group is improving proximity to its customers by identifying
and filling gaps in its geographical coverage. Sales forces are
being expanded and up-skilled by restoring their historic
industry-leading, bench-strength of specialist local expertise in
areas such as fire protection, energy efficiency and sustainable
materials. Sales force productivity is also being increased through
enhanced sales management and training, supported by sales force
management tools, disciplines and aligned incentives, with customer
reconnection a top priority.
Facilitate growth through better operations
A number of actions are well advanced in the Group's operations
to increase efficiency and service levels to boost the sales
effort, including:
o pricing tools and training for key account and branch
managers, providing enhanced visibility and autonomy to set pricing
quickly and competitively;
o improved product availability through the use of enhanced
systems and more accurate operational key performance indicators,
such as stock availability;
o enhanced on time and in full delivery; and
o additional training, which is being provided to the Group's
workforce in order to promote operational excellence and customer
service.
Liquidity and balance sheet strengthening
The successful renegotiation of the Group's debt facilities
during the summer resulted in a resetting of its covenant
requirements, with additional minor amendments made in early March
2021 to better align the different tests. Consolidated liquidity
covenants are to be tested monthly through to the maturity of the
facilities, with net borrowings tested monthly until December 2022.
From March 2022, leverage will be tested on a quarterly basis, and
interest cover will be tested from June 2022. Consolidated net
worth will also be tested each quarter through to maturity of the
facilities.
The significant loss of revenues in H1 2020 impacted
profitability, cash generation and therefore debt levels, though
the immediate and comprehensive set of actions enacted across the
business around cash conservation, coupled with the receipt of the
sale proceeds of the Air Handling business, meant that the Group
was able to preserve its liquidity throughout the period.
In mid-July, the Group completed a successful capital raise, as
previously announced, raising gross proceeds of GBP165m (cGBP152m
net of related costs). At the same time, approximately GBP13m costs
were paid in relation to the debt refinancing.
As at the year-end, the Group had net debt on a pre IFRS 16
basis of GBP4.1m. By the end of February 2021 this number had
increased to GBP36.4m, reflecting the expected seasonal increase in
working capital, as well as some payments of annual commitments. We
expect a net cash outflow during the first half and a modest cash
inflow in H2.
Dividend
In line with the terms of the Group's amended debt arrangements,
t he Board did not declare or pay an interim dividend for the 2020
financial year, and nor will a final dividend be declared.
Successful execution of the Return to Growth strategy will
return the Group to sustainable, profitable growth and cash
generation, capable of supporting a range of capital allocation
priorities. As such, the Board retains its medium term commitment
to return to a progressive dividend policy, appropriately covered
by underlying earnings.
People
The Board would like to thank all employees of SIG for their
continued commitment and resilience in 2020, which was a
particularly challenging year as a result of Covid-19. Whilst the
trading results were affected by the pandemic, their efforts have
laid a strong foundation for the next phase of SIG's evolution as
we focus on building a stronger business with a high performing
workforce that is rewarded for making a positive difference.
The Board recognises that safety must always be its number one
priority - for its employees, its suppliers, its customers, and
within the communities where we operate. A key focus for the Group
since the outbreak of the Covid-19 pandemic has been to ensure that
within those operations that remained open for business, all
necessary measures were taken in line with government safety
guidelines to protect the health and safety of employees, suppliers
and customers.
To further strengthen engagement with colleagues, the Board
appointed Simon King as the designated Non-Executive Director for
workforce engagement with effect from 1 October 2020. In addition,
in early 2020, a new culture programme was launched to develop a
culture aligned to shared behaviours and encourage openness and
transparency.
Whilst Covid-19 hindered the full implementation of a Group-wide
culture programme, it did provide the opportunity to realign and
strengthen the framework comprising a vision, the strategic pillars
and cultural behaviours of the Group. Work took place to
incorporate employee feedback, and local teams took the opportunity
to improve their understanding of the behaviours and how they
contribute towards a change in culture. The full roll out resumed
in January 2021.
Covid-19
The Board closely monitored the impact of the pandemic on the
business and on our people, and continues to do so. Throughout the
last twelve months, the safety of our people, customers and
suppliers has been, and continues to be, our primary concern.
Additional health and safety measures were quickly implemented at
the beginning of the outbreak, and the new protocols continue to be
adhered to across the Group, in line with the government guidance
across all jurisdictions in which it operates. To support home
working, the Group's IT infrastructure was strengthened. As a
result of the quick and agile response to the pandemic, and from
some government support, the Group was able to mitigate the impact
without reducing headcount as a result of Covid-19.
The specific actions taken included, but were not limited
to:
i. Employees: Over 2,000 employees were furloughed under the UK
Government's scheme and the majority of trading sites across the UK
and Ireland were temporarily closed. Remaining staff agreed to take
up to 20% temporary pay reductions, with the salaries of all
members of the Board temporarily reduced by 50% from 1 April to 30
June 2020. In mid-May, the Company reinstated the Executive
Directors' pay to 80% at the same time as other Group employees
were returning to work on full pay.
ii. Government support: Relevant government support was accessed
in all countries of operation, across employment support, tax and
social security deferrals. In aggregate, use of government support
schemes enabled the Group to defer approximately GBP21m of cash
payments to points later within 2020, with another cGBP4m deferred
into 2021, and to support the retention of jobs through the receipt
of cGBP11m of furlough monies and other forms of support.
iii. Capital expenditure: Programmes that required significant
cash investment or did not provide near-term business benefits were
paused.
iv. Customers: The Group remained very diligent in proactively
managing collections and monitoring overdue payments.
v. Trade suppliers: The Group conducted active discussions with
large trade suppliers in order to maintain continuity of supply,
and in some cases was able to net rebates off against payments
earlier than scheduled.
vi. Non-trade suppliers: Deferral and terms extension requests
were managed across non-trade suppliers, with a significant focus
on IT, services and property, with property rates being deferred on
UK properties.
vii. Dividend: As noted above, the Board did not declare a full
year 2019 dividend or interim 2020 dividend.
The decisive actions taken across all functions and at all
levels in the business mitigated the initial impact of the global
pandemic. The performance in the first half of the year was
materially affected by the different government lockdown responses
to the pandemic in the countries in which we operate, notably in
the UK and Ireland during March and April, although less than we
had originally envisaged. With the easing of lockdown restrictions
in May and June, the Group saw a gradual improvement in trading
performance, accompanied by a corresponding reduction in losses and
this continued in the second half. Despite further lockdowns and
restrictions from October onwards, the business was able to trade
broadly as normal throughout the second half, albeit within the new
operating norms and protocols.
Portfolio management
As announced on 3 February 2020, the Company completed the sale
of its Air Handling Division to France Air Management SA for an
enterprise value of EUR222.7m (cGBP187.0m) on a cash free, debt
free basis on 31 January 2020. After payment of transaction costs
and other agreed adjustments to the consideration, the net cash
inflow totalled cGBP148m. The results from this business have been
excluded from the reported underlying results and are shown as a
discontinued operation in both FY 2020 and the prior year.
The Building Solutions business was classified as held for sale
at 31 December 2019 as a sale had been agreed and was due to
complete in the first half of 2020, subject to approval from the UK
Competition and Markets Authority (CMA). As announced in May 2020,
the parties agreed to terminate the sales agreement as terms could
not be agreed for the extension of the agreement to enable the
completion of the CMA phase 2 investigation. During the second half
of the year the Board decided to retain and develop the business,
and it is now reported as part of underlying operations. Prior year
comparatives have been restated to present numbers on a consistent
basis with the current year.
Trading overview
Like-for-like sales growth by market is summarised as
follows:
LFL sales growth
2020 Q1 Q2 Q3 Q4 FY FY sales
GBPm
UK Distribution (34)% (63)% (25)% (3)% (33)% 357
UK Exteriors (11)% (46)% 1% 11% (11)% 258
Building Solutions (14)% (38)% 0% 7% (11)% 52
UK (26)% (56)% (14)% 3% (25)% 667
--------------------- ------ ------ ------ ------ ------ ---------
France Distribution (12)% (30)% (3)% 4% (10)% 168
France Exteriors (12)% (10)% 5% 20% 0% 345
Germany (6)% (11)% (4)% 2% (5)% 371
Benelux (4)% (18)% (13)% (16)% (13)% 92
Ireland (9)% (52)% (10)% 5% (17)% 80
Poland 4% (4)% (8)% (2)% (3)% 150
EU (7)% (16)% (3)% 6% (6)% 1,206
--------------------- ------ ------ ------ ------ ------ ---------
Group (15)% (33)% (8)% 4% (13)% 1,873
--------------------- ------ ------ ------ ------ ------ ---------
Despite the materially adverse impacts on trading from Covid-19,
the Group's results for the year were better than initial internal
estimates that were made at the onset of the pandemic early in the
year.
The year commenced with a like-for-like decline in underlying
revenues of c11% for the first two months of trading, reflecting
the continuation of the challenging trends experienced during the
final quarter of 2019 in the UK and Germany. Trading activity
across the Group's other end markets remained relatively
stable.
The onset of the pandemic led to a period of temporary lockdown
in a number of the markets in which the Group operates,
significantly impacting revenue streams during March and April in
France, and April and May in the UK and Ireland, in common with the
broader construction industry. The Group's operating companies in
Germany, Poland and Benelux were also impacted by local government
containment measures, although to a lesser extent. Despite the
lockdowns, parts of our UK and Ireland businesses did remain open
to service critical and emergency projects only, such as for the
NHS, energy and food sectors. After rapidly enhancing our health
and safety protocols across all of the Group's branches and offices
we were able to operate a staged reopening of our branch network
through April and May, in conjunction with local government
guidelines. Underlying revenues during the second quarter declined
33% on a like-for-like basis.
The material drop in sales volumes across our end markets
throughout the first half led to reductions in underlying gross
profit margins, principally driven by reduced levels of supplier
rebates, and hence reduced profitability. To partly offset the
adverse impacts, the Group initiated a number of decisive actions
that not only reduced its cost base but also supported its
liquidity position. Additionally, the Group accessed
government-supported job retention schemes.
Trading over the summer months continued to show signs of
improvement as local restrictions across a number of the Group's
trading markets were relaxed, coupled with a strong consumer demand
in the repair, maintenance and improvement ("RMI") market segment,
benefiting our UK and France Exteriors businesses.
Despite improving conditions, trading continued to be
challenging as we moved into the second half of 2020, particularly
in UK Distribution, Ireland and Benelux where various levels of
local government-imposed trading restrictions were still in force.
However, whilst the Group's LFL sales in the third quarter
continued to be down year-on-year, the trajectory improved, with
all operating companies, except Poland, witnessing an increase in
trading volumes. Underlying revenues in the third quarter finished
8% behind prior year on a like-for-like basis. Margins, and hence
profitability, in quarter three showed an improvement on the
previous quarter, with a revenue uplift of 38% coming principally
from reduced effects of Covid-19, particularly in the UK
businesses, resulting in higher levels of supplier rebates.
The fourth quarter saw a return to positive LFL sales at a Group
level (+4%), with strength in the RMI markets continuing to assist
our exteriors businesses in the UK and France and underpinned by
early signs of progress coming from the Group's Return to Growth
strategy, which started to deliver an improved organic sales
performance. The fourth trading quarter volumes also saw further
improvement in gross margins and profitability, providing solid
momentum as we entered 2021.
Outlook
Trading in 2021 to date is in line with management expectations,
continuing on a similar trajectory to Q4 2020. The market
fundamentals for SIG remain strong and we are benefiting from good
RMI growth in UK and France. We now have the right structure in
place for UK Distribution and revenue growth is starting to emerge
as planned.
Continued uncertainty remains regarding Covid-19, as well as
rising input prices and early signs of some potential materials
shortages. However, p roviding there is no further material
disruption to either our business or end markets as a result of the
pandemic, the Board expects the near-term benefits of the actions
taken in 2020 to deliver organic revenue growth in 2021, including
market share gains. The benefits of this will become increasingly
evident as the year progresses and should enable us to return to
underlying operating profitability and cash generation during the
second half.
FINANCIAL REVIEW
Revenue and gross margin
The Group saw a 13% decline in its LFL revenue over the year,
with Group underlying revenue down to GBP1,872.7m (2019:
GBP2,143.0m), principally as a result of the Covid-19 impact.
Underlying results exclude the results from the businesses that are
classified as non-core and Other items, in order to provide a
better understanding of the performance of the Group on a
continuing basis. On a statutory basis, Group revenue was
GBP1,874.5m (2019: GBP2,160.6m), with non-core businesses reporting
sales of GBP1.8m (2019: GBP17.6m).
Underlying gross profit decreased 15.4% to GBP470.0m (2019:
GBP555.4m) with a gross profit margin of 25.1% (2019: 25.9%). This
primarily reflects lower rebate receipts due to decreased sales
volumes. On a statutory basis, gross profit fell from GBP559.1m to
GBP470.5m with gross margin decreasing by 80bps to 25.1% (2019:
25.9%).
Operating costs and profit
The Group's underlying operating costs were GBP523.3m (2019:
GBP512.9m). The increase was primarily due to the release of a
number of one-off accruals and provisions in 2019, some temporary
costs related to the UK and broader Group reorganisations,
normalisation of incentives, increases to bad debt expense in
response to Covid-19 uncertainty, cost inflation, and movements in
foreign currency. These increases were partially offset by cGBP12m
benefit from furlough schemes, other government support, and wage
saving initiatives. The Group's underlying operating loss was
GBP53.3m (2019: GBP42.5m profit) and at a statutory level, the
Group's operating loss was GBP167.7m (2019: GBP87.9m) after Other
items of GBP114.4m (2019: GBP130.4m). The latter included GBP76.1m
of impairment charges, GBP13.2m of onerous contract costs, GBP7.4m
costs associated with refinancing, and GBP6.7m costs relating to
restructuring activities.
Segmental analysis
LFL sales
----------- ------------ ----------- ------------------
Underlying Underlying
Underlying Underlying
operating operating
revenue revenue(1) loss profit/(loss)(1)
2020 2019 2020 2019
GBPm GBPm H1 H2 FY 2020 GBPm GBPm
----------- ------------ ------ ------ -------- ----------- ------------------
UK Distribution 357.4 534.3 (48)% (15)% (33)% (45.4) 7.9
UK Exteriors 310.1 346.5 (27)% 5% (11)% (7.4) 11.8
UK before
non-core 667.5 880.8 (40)% (7)% (25)% (52.8) 19.7
----------- ------------ ------ ------ -------- ----------- ------------------
Non-core businesses - 1.2 - - - - (0.8)
--------------------- ----------- ------------ ------ ------ -------- ----------- ------------------
UK 667.5 882.0 (40)% (7)% (25)% (52.8) 18.9
--------------------- ----------- ------------ ------ ------ -------- ----------- ------------------
UK
(1 - 2019 restated to include Building Solutions, reported as
non-core in 2019.)
Underlying revenue in UK Distribution, a specialist insulation
and interiors distribution business, was down 33.1% to GBP357.4m
(2019: GBP534.3m). Underlying gross margin dropped 370bps to 22.5%
(2019: 26.2%). The lockdown during March and April severely
impacted UK trading and as a result, combined with some continued
underlying weakness in performance, underlying operating loss was
GBP45.4m (2019: GBP7.9m profit).
Despite a strong second half recovery, helped by a robust RMI
market, UK Exteriors, a specialist roofing merchant, which also
includes our Building Solutions business, saw underlying revenue
fall by 10.5% to GBP310.1m (2019: GBP346.5m) for the full year.
Gross margin decreased 100bps to 27.3% (2019: 28.3%). As a result
of these decreases, driven by the impact of Covid-19, the business
recorded an underlying operating loss of GBP7.4m (2019: GBP11.8m
profit).
France
LFL sales
----------- ----------- --------------- ---------------
Underlying Underlying
Underlying Underlying
operating operating
revenue revenue profit/(loss) profit/(loss)
2020 2019 2020 2019
GBPm GBPm H1 H2 FY 2020 GBPm GBPm
----------- ----------- ------ ---- -------- --------------- ---------------
France Distribution 168.1 184.5 (21)% 1% (10)% 7.1 11.2
France Exteriors 344.8 342.2 (11)% 12% 0% 8.3 8.6
France before
non-core 512.9 526.7 (14)% 8% (3)% 15.4 19.8
----------- ----------- ------ ---- -------- --------------- ---------------
Non-core businesses 1.8 1.9 - - - (0.3) (0.9)
--------------------- ----------- ----------- ------ ---- -------- --------------- ---------------
France 514.7 528.6 (14)% 8% (3)% 15.1 18.9
--------------------- ----------- ----------- ------ ---- -------- --------------- ---------------
Trading activity suffered a temporary setback in France
following the short term closure of all branches for three days in
mid-March. The businesses then commenced a staged reopening through
into April.
France Distribution, trading as LiTT, a structural insulation
and interiors business, saw underlying revenue decrease by 8.9% to
GBP168.1m (2019: GBP184.5m), and by 10% on a LFL basis after
adjusting for foreign exchange movements. Within this, the second
half of the year showed clear signs of recovery, with LFL sales for
the six months up 1%. Underlying gross margin remained flat at
27.4% (2019: 27.4%), with the reduction in revenue resulting in a
GBP4.1m decrease in underlying operating profit to GBP7.1m (2019:
GBP11.2m).
Underlying revenue in France Exteriors, trading as Larivière, a
specialist roofing business, increased by 0.8% to GBP344.8m (2019:
GBP342.2m), with H1 revenues down on prior year, though ahead in H2
on the back of strong demand in the RMI market, similar to that
witnessed in the UK. Helped by a new pricing framework introduced
during the latter stages of 2019, underlying gross margin improved
90bps in the period to 24.3% (2019: 23.4%). After taking into
account inflationary cost increases and foreign currency movement,
underlying operating profit reduced by GBP0.3m to GBP8.3m (2019:
GBP8.6m).
Germany and Benelux
LFL sales
----------- ----------- ----------- -----------
Underlying Underlying
Underlying Underlying operating operating
revenue revenue profit profit
2020 2019 2020 2019
GBPm GBPm H1 H2 FY 2020 GBPm GBPm
----------- ----------- ------ ------ -------- ----------- -----------
Germany 370.7 381.5 (9)% (1)% (5)% 0.4 4.4
Benelux 91.6 103.0 (12)% (14)% (13)% 2.5 5.2
Germany and
Benelux before
non-core 462.3 484.5 (9)% (4)% (7)% 2.9 9.6
----------- ----------- ------ ------ -------- ----------- -----------
Non-core businesses - 14.5 - - - - 0.8
--------------------- ----------- ----------- ------ ------ -------- ----------- -----------
Germany and
Benelux 462.3 499.0 (9)% (4)% (7)% 2.9 10.4
--------------------- ----------- ----------- ------ ------ -------- ----------- -----------
The Group's operating companies in Germany and Benelux were
impacted by government measures due to Covid-19, but to a lesser
extent than in the UK, Ireland and France, and trading continued
from all sites throughout the period.
Underlying revenue in WeGo/VTi, our specialist insulation and
interiors distribution business in Germany, fell by 2.8% to
GBP370.7m (2019: GBP381.5m) and by 5% on a LFL basis. In addition
to the challenges faced due to Covid-19, H1 trading in Germany also
saw a continuation of the weaker trends experienced in the last
quarter of 2019. However, underlying gross margin increased 30bps
to 28.0% (2019: 27.7%), reflecting a number of renegotiated
contracts with suppliers whereby thresholds have been reduced, and
assisted by further enhancements around pricing controls.
Underlying operating profit for the period was GBP0.4m (2019:
GBP4.4m).
Underlying revenue from the Group's business in the Benelux
region fell by 11.1% to GBP91.6m (2019: GBP103.0m), with the
impacts of Covid-19 being exacerbated by a reduction in
construction output in the Netherlands following changes in
environmental restrictions in 2019. Despite a very competitive
marketplace, underlying gross margin decreased only 10bps to 24.6%
(2019: 24.7%). As a result of the drop in revenue, operating profit
decreased to GBP2.5m (2019: GBP5.2m).
Ireland
LFL sales
----------- ----------- ----------- -----------
Underlying Underlying
Underlying Underlying operating operating
revenue revenue profit profit
2020 2019 2020 2019
GBPm GBPm H1 H2 FY 2020 GBPm GBPm
----------- ----------- ------ ----- -------- ----------- -----------
Ireland 80.5 94.9 (31)% (3)% (17)% 0.8 6.8
--------- ----------- ----------- ------ ----- -------- ----------- -----------
In Ireland, a specialist distributor of interiors, insulation
and construction accessories, revenues in March to April were
significantly impacted by the Covid-19 pandemic, with a gradual
improvement in performance in May to June as branches began to
reopen. Underlying revenue declined by 15.2% to GBP80.5m (2019:
GBP94.9m), and by 17% on a LFL basis after adjusting for working
days and foreign currency movements. Underlying gross margin
dropped to 23.4% (2019: 25.0%) as the business saw a shift in sales
mix away from its higher margin offerings, with underlying
operating profit for the period of GBP0.8m (2019: GBP6.8m).
Poland
LFL sales
----------- ----------- ----------- -----------
Underlying Underlying
Underlying Underlying operating operating
revenue revenue profit profit
2020 2019 2020 2019
GBPm GBPm H1 H2 FY 2020 GBPm GBPm
----------- ----------- ----- ----- -------- ----------- -----------
Poland 149.5 156.1 (0)% (5)% (3)% 2.0 4.3
-------- ----------- ----------- ----- ----- -------- ----------- -----------
In Poland, a market leading distributor of insulation and
interiors, underlying revenue fell to GBP149.5m (2019: GBP156.1m),
with LFL sales down 3%. Whilst also impacted by government
measures, trading continued from all sites throughout the period.
Underlying gross margin decreased slightly to 20.0% (2019: 20.3%),
with the business delivering an underlying profit of GBP2.0m (2019:
GBP4.3m) in the period, driven by the drop in revenue and a small
increase in operating costs.
Reconciliation of underlying to statutory result
Other items, being items excluded from underlying results,
during the period amounted to GBP126.0m (2019: GBP130.4m) on a
pre-tax basis and are summarised in the table below:
2020 2019
--------------------------------------------------
GBPm GBPm
-------------------------------------------------- -------- --------
Underlying (loss)/profit before tax (76.3) 17.7
Other items - impacting (loss)/profit before
tax:
Amortisation of acquired intangibles (5.6) (6.2)
Impairment charges (76.1) (90.9)
Profit on agreed sale or closure of non-core
businesses and associated impairment charges 0.6 0.1
Net operating losses attributable to businesses
identified as non-core (0.3) (0.9)
Net restructuring costs (6.7) (27.1)
Investment in omnichannel retailing (4.2) (5.7)
Onerous contract costs (13.2) -
Costs associated with refinancing (7.4) -
Non-underlying finance costs (11.6) -
Other specific items (1.5) 0.3
================================================== ======== ========
Total Other items (126.0) (130.4)
================================================== ======== ========
Statutory loss before tax (202.3) (112.7)
-------------------------------------------------- -------- --------
Further details of Other items are as follows:
-- The impairment charges of GBP76.1m (2019: GBP90.9m) comprise
GBP45.4m related to goodwill, GBP1.9m customer relationships in
intangibles, GBP13.7m implementation costs of ERP systems ("SAP
1HANA") in Germany and France, GBP1.4m other software costs,
GBP3.5m tangible fixed assets, and GBP10.2m right-of-use
assets.
-- Net restructuring costs of GBP6.7m (2019: GBP27.1m) were
incurred in connection with the prior year target operating model
projects in the UK, Germany and France, the current year
restructuring of the UK businesses as part of the implementation of
the Return to Growth strategy, and restructuring in Benelux.
-- Onerous contract costs of GBP13.2m (2019: GBPnil) related to
provisions recognised for licence fee commitments where no future
economic benefit is expected, principally in relation to the SAP
1HANA implementation.
-- Costs associated with refinancing of GBP7.4m (2019: GBPnil)
includes legal and professional fees of GBP8.3m offset by a GBP0.9m
gain in relation to the partial derecognition of a cash flow
hedging arrangement as a result of the change in debt facility
agreements.
-- Non-underlying finance costs of GBP11.6m (2019: GBPnil)
comprise GBP11.3m loss on modification recognised in relation to
the private placement notes and GBP0.3m write-off of arrangement
fees in relation to the previous Revolving Credit Facility which
has been extinguished.
Taxation
The effective tax rate for the Group on the total loss before
tax of GBP130.3m (2019: GBP108.9m) is negative 6.8% (2019: negative
14.3%). As the Group operates in several different countries, tax
losses cannot be surrendered or utilised cross border and the Group
therefore pays tax in some countries and not in others. Tax losses
are not currently recognised in respect of the UK business, which
also impacts the overall effective tax rate. The combination of
these factors means that the effective tax rate is less meaningful
as an indicator or comparator for the Group.
In accordance with UK legislation, the Group publishes an annual
tax strategy, which is available on our website,
www.sigplc.com.
Pensions
The Group operates four (2019: six) defined benefit pension
schemes and a number of defined contribution pension schemes. The
largest defined benefit scheme is a UK scheme, which was closed to
further accrual in 2016.
The Group's total pension charge for the year, including amounts
charged to interest and Other items, was GBP6.9m (2019: GBP7.0m),
of which a charge of GBP0.7m (2019: GBP0.7m) related to defined
benefit pension schemes and GBP6.2m (2019: GBP6.3m) related to
defined contribution schemes.
The overall defined benefit pension schemes' liabilities before
taxation increased marginally during the year to GBP25.1m (2019:
GBP24.8m).
Financial position
In July 2020, we concluded the successful restructure of our
financing facilities and a GBP165m capital raise (cGBP152m net of
related costs). These, along with our careful management of working
capital and cash in the year, have strengthened the balance sheet
and created a sound financial base on which we can rebuild the
business. Overall, the net assets of the Group have increased by
4.1% to GBP306.3m (2019: GBP294.2m), with a cash position at
year-end of GBP235.3m (2019: GBP110.0m, excluding cash from
businesses held for sale) and net debt of GBP238.2m (2019:
GBP455.4m).
Group structure
The results at FY 2019 have been restated to reflect the change
to core businesses subsequent to the year-end announcement. Please
refer to the table below:
Underlying Underlying
revenue PBT
GBPm GBPm
----------- -----------
As reported at FY 2019 results 2,084.7 15.6
-------------------------------- ----------- -----------
Building Solutions 58.3 2.1
Restated at FY 2020 results 2,143.0 17.7
----------- -----------
Cash flow
2020 2019
-----------------------------------------
GBPm GBPm
----------------------------------------- -------- -------
Total operating loss, excluding gain
on sale from Air Handling (166.6) (82.9)
Depreciation and non-cash items 154.4 177.9
(Increase)/decrease in working capital
and provisions (30.8) 71.0
Interest and tax (32.3) (35.3)
Capital expenditure (20.8) (34.5)
Proceeds from sale of property, plant
and equipment 5.6 7.6
----------------------------------------- -------- -------
Free cash flow (90.5) 103.8
Sale and purchase of businesses 147.0 7.5
Payment of lease liabilities (54.8) (59.9)
(Repayment)/drawdown of debt (85.2) 42.4
Dividends paid to equity holders of
the Company - (22.2)
Net proceeds from capital raise 151.9 -
----------------------------------------- -------- -------
Change in cash and cash equivalents 68.4 71.6
----------------------------------------- -------- -------
Cash and cash equivalents at beginning
of the year 145.1 78.8
Effect of foreign exchange rate changes 21.8 (5.3)
----------------------------------------- -------- -------
Cash and cash equivalents at end of
the year 235.3 145.1
----------------------------------------- -------- -------
During the year, the Group reported a free cash outflow of
GBP90.5m (2019: GBP103.8m inflow) as a result of the loss in the
year and an increase in working capital, together with payments in
relation to interest, tax and capital expenditure. Other movements
in cash relate to GBP147.0m cash inflow from the sale and purchase
of businesses (2019: GBP7.5m), GBP151.9m net proceeds from the
capital raise (2019: nil), GBP85.2m repayments of debt (2019:
GBP42.4m drawdown) and GBP54.8m payment of lease liabilities (2019:
GBP59.9m).
Free cash flow represents the cash available after supporting
operations and maintaining capital assets, and before financing and
investing activities.
Financing and funding
On 18 June 2020, the Group agreed amended debt facility
agreements in respect of its Revolving Credit Facility and private
placement notes. On 10 July 2020, the Group also completed the
successful raising of GBP165m (cGBP152m net of related costs)
equity through a firm placing, and placing and open offer, in order
to reduce the Group's net debt and strengthen its balance
sheet.
The Group has significant available liquidity and on the basis
of current forecasts is expected to remain in compliance with all
banking covenants throughout the forecast period to 31 March 2022.
On 1 March 2021, the Group agreed with its lending banks and
private placement noteholders to amend certain financial covenants
to better align the different tests and to provide additional
headroom on the interest cover covenant under stress test scenarios
from March 2022.
Directors' responsibility statement on the Annual Report
The responsibility statement below has been prepared in
connection with the Company's full Annual Report for the year ended
31 December 2020. Certain parts solely thereof are not included
within this announcement.
We confirm that to the best of our knowledge:
(a) the Financial Statements, prepared in accordance with the
relevant applicable set of accounting standards, give a true and
fair view of the assets, liabilities, financial position and profit
or loss of the Company and the undertakings included in the
consolidation taken as a whole;
(b) the Strategic Report includes a fair review of the
development and performance of the business and the position of the
Company and the undertakings included in the consolidation taken as
a whole, together with a description of the principal risks and
uncertainties that they face; and
(c) the Annual Report and Financial Statements, taken as a
whole, are fair, balanced and understandable and provide the
information necessary for shareholders to assess the Company's
position and performance, business model and strategy.
This responsibility statement was approved by the Board of
Directors on 25 March 2021 and signed on its behalf by:
Steve Francis Ian Ashton
Director Director
25 March 2021 25 March 2021
Cautionary statement
The securities of the Group have not been and will not be
registered under the US Securities Act of 1933, as amended (the
"Securities Act"), or under the securities laws of any state or
other jurisdiction of the United States, and may not be offered,
sold, pledged or transferred , directly or indirectly, in, into or
within the United States except pursuant to an exemption from, or
in a transaction not subject to, the registration requirements of
the Securities Act and in compliance with any applicable securities
laws of any relevant state or other jurisdiction of the United
States. There has been and will be no public offering of the
securities of the Group in the United States.
This announcement has been prepared to provide the Company's
shareholders with a fair review of the business of the Group and a
description of the principal risks and uncertainties facing it. It
may not be relied upon by anyone, including the Company's
shareholders, for any other purpose.
This announcement contains forward-looking statements that are
subject to risk factors including the economic and business
circumstances occurring from time to time in countries and markets
in which the Group operates and risk factors associated with the
building and construction sectors. By their nature, forward-looking
statements involve a number of risks, uncertainties and assumptions
because they relate to events and/or depend on circumstances that
may or may not occur in the future and could cause actual results
and outcomes to differ materially from those expressed in or
implied by the forward-looking statements. Forward-looking
statements in this Announcement include, but are not limited to,
statements about the Group's future financial and operational
performance, the new management's ability to successfully execute
the new strategy, and the ability of the Group and the construction
industry generally to respond to the effects and aftermath of the
Covid-19 pandemic. No assurance can be given that the
forward-looking statements in this announcement will be realised.
Statements about the Directors' expectations, beliefs, hopes,
plans, intentions and strategies are inherently subject to change
and they are based on expectations and assumptions as to future
events, circumstances and other factors which are in some cases
outside the Group's control. Actual results could differ materially
from the Group's current expectations.
It is believed that the expectations set out in these
forward-looking statements are reasonable but they may be affected
by a wide range of variables which could cause actual results or
trends to differ materially, including but not limited to, changes
in risks associated with the level of market demand, fluctuations
in product pricing and changes in foreign exchange and interest
rates.
The Company's shareholders are cautioned not to place undue
reliance on the forward-looking statements. This announcement has
not been audited or otherwise independently verified. The
information contained in this announcement has been prepared on the
basis of the knowledge and information available to Directors at
the date of its preparation and the Company does not undertake any
obligation to update or revise this announcement during the
financial year ahead.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014.
Consolidated Income
Statement
for the year ended
31 December 2020
Other Other
Underlying* items** Total Underlying* items** Total
2020 2020 2020 2019 2019 2019
Restated^ Restated^
Note GBPm GBPm GBPm GBPm GBPm GBPm
----------------------------- ----- ------------ --------- ---------- ------------ ---------- ----------
Continuing operations
Revenue 2 1,872.7 1.8 1,874.5 2,143.0 17.6 2,160.6
Cost of sales (1,402.7) (1.3) (1,404.0) (1,587.6) (13.9) (1,601.5)
----------------------------- ----- ------------ --------- ---------- ------------ ---------- ----------
Gross profit 470.0 0.5 470.5 555.4 3.7 559.1
Other operating expenses 3 (523.3) (114.9) (638.2) (512.9) (134.1) (647.0)
----------------------------- ----- ------------ --------- ---------- ------------ ---------- ----------
Operating (loss)/profit (53.3) (114.4) (167.7) 42.5 (130.4) (87.9)
Finance income 0.7 - 0.7 0.5 - 0.5
Finance costs (23.7) (11.6) (35.3) (25.3) - (25.3)
----------------------------- ----- ------------ --------- ---------- ------------ ---------- ----------
(Loss)/profit before
tax from continuing
operations (76.3) (126.0) (202.3) 17.7 (130.4) (112.7)
Income tax (expense)/credit 4 (10.7) 4.1 (6.6) (16.3) 4.9 (11.4)
------------
(Loss)/profit after
tax from continuing
operations (87.0) (121.9) (208.9) 1.4 (125.5) (124.1)
----------------------------- ----- ------------ --------- ---------- ------------ ---------- ----------
Discontinued operations
Profit/(loss) after
tax from discontinued
operations 10 - 69.7 69.7 - (0.4) (0.4)
(Loss)/profit after
tax for the year (87.0) (52.2) (139.2) 1.4 (125.9) (124.5)
----------------------------- ----- ------------ --------- ---------- ------------ ---------- ----------
Attributable to:
Equity holders of
the Company (87.0) (52.2) (139.2) 1.4 (125.9) (124.5)
----------------------------- ----- ------------ --------- ---------- ------------ ---------- ----------
Loss per share
From continuing operations:
Basic 5 (24.0)p (21.0)p
Diluted 5 (23.9)p (21.0)p
Total:
Basic 5 (16.0)p (21.0)p
Diluted 5 (15.9)p (21.0)p
----------------------------- ----- ------------ --------- ---------- ------------ ---------- ----------
^ The 2019 comparatives have been restated to include Building
Solutions within underlying results consistent with the current
year.
* Underlying represents the results before Other items.
** Other items have been disclosed separately in order to give
an indication of the underlying earnings of the Group. Further
details can be found in Note 3.
Consolidated Statement of Comprehensive
Income
for the year ended 31 December 2020
----------------------------------------------------- -------- --------
2020 2019
GBPm GBPm
----------------------------------------------------- -------- --------
Loss after tax for the year (139.2) (124.5)
Items that will not subsequently be reclassified
to the Consolidated Income Statement:
Remeasurement of defined benefit pension
liability (1.7) (1.8)
Deferred tax movement associated with remeasurement
of defined benefit pension liability 0.3 (6.6)
Current tax movement associated with remeasurement
of defined benefit pension liability 0.4 0.4
(1.0) (8.0)
Items that may subsequently be reclassified
to the Consolidated Income Statement:
Exchange difference on retranslation of
foreign currency goodwill and intangibles 5.1 (7.4)
Exchange difference on retranslation of
foreign currency net investments (excluding
goodwill and intangibles) 13.2 (16.1)
Exchange and fair value movements associated
with borrowings and derivative financial
instruments (11.0) 10.9
Tax credit on fair value movements arising
on borrowings and derivative financial
instruments - (2.1)
Exchange differences reclassified to the
Consolidated Income Statement in respect
of the disposal of foreign operations (5.9) (0.1)
Gains and losses on cash flow hedges (0.5) 0.4
Transfer to profit and loss on cash flow
hedges (0.7) 0.9
------------------------------------------------------ -------- --------
0.2 (13.5)
----------------------------------------------------- -------- --------
Other comprehensive expense (0.8) (21.5)
------------------------------------------------------ -------- --------
Total comprehensive expense (140.0) (146.0)
------------------------------------------------------ -------- --------
Attributable to:
Equity holders of the Company (140.0) (146.0)
(140.0) (146.0)
----------------------------------------------------- -------- --------
Consolidated Balance Sheet
as at 31 December 2020
2020 2019
GBPm GBPm
---------------------------------- -------- --------
Non-current assets
Property, plant and equipment 63.2 58.6
Right-of-use assets 229.6 255.2
Goodwill 128.8 159.0
Intangible assets 22.9 42.3
Lease receivables 3.6 4.4
Deferred tax assets 5.7 4.4
Derivative financial instruments 0.1 1.7
453.9 525.6
---------------------------------- -------- --------
Current assets
Inventories 170.3 156.5
Lease receivables 0.7 0.8
Trade and other receivables 294.4 294.7
Current tax assets - 0.9
Derivative financial instruments - 0.9
Cash at bank and on hand 235.3 110.0
Assets classified as held for
sale - 258.4
700.7 822.2
---------------------------------- -------- --------
Total assets 1,154.6 1,347.8
----------------------------------- -------- --------
Current liabilities
Trade and other payables 301.4 327.4
Lease liabilities 50.6 51.5
Bank loans - 99.6
Private placement notes - 175.5
Deferred consideration 0.5 -
Other financial liabilities 0.5 1.5
Derivative financial instruments 0.5 0.2
Current tax liabilities 4.2 3.7
Provisions 10.5 6.7
Liabilities directly associated
with assets classified as held
for sale - 115.7
368.2 781.8
---------------------------------- -------- --------
Non-current liabilities
Lease liabilities 211.6 224.1
Bank loans 67.7 -
Private placement notes 144.5 -
Deferred consideration 0.4 -
Derivative financial instruments 0.4 1.9
Other financial liabilities 1.2 1.4
Other payables 3.5 1.0
Retirement benefit obligations 25.1 24.8
Provisions 25.7 18.6
480.1 271.8
---------------------------------- -------- --------
Total liabilities 848.3 1,053.6
----------------------------------- -------- --------
Net assets 306.3 294.2
----------------------------------- -------- --------
Capital and reserves
Called up share capital 118.2 59.2
Share premium account 447.7 447.3
Treasury shares (0.2) -
Capital redemption reserve 0.3 0.3
Share option reserve 2.0 1.8
Hedging and translation reserves 10.5 10.2
Cost of hedging reserve 0.2 0.3
Merger reserve 92.5 -
Retained losses (364.9) (224.9)
Attributable to equity holders
of the Company 306.3 294.2
----------------------------------- -------- --------
Total equity 306.3 294.2
----------------------------------- -------- --------
Consolidated
Statement of
Changes in Equity
for the year
ended 31 December
2020
------------------ -------- -------- ---------- ----------- -------- ------------ -------- --------- ---------- --------
Called Hedging Cost
up Share Treasury Capital Share and of Retained
share premium shares redemption option translation hedging Merger (losses)/
capital account reserve reserve reserve reserves reserve reserve profits Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
------------------ -------- -------- ---------- ----------- -------- ------------ -------- --------- ---------- --------
At 31 December
2018 59.2 447.3 - 0.3 1.7 21.7 1.0 - (68.3) 462.9
Impact of
adoption of IFRS
16 - - - - - - - - (0.6) (0.6)
------------------ -------- -------- ---------- ----------- -------- ------------ -------- --------- ---------- --------
Adjusted balance
at 1 January
2019 59.2 447.3 - 0.3 1.7 21.7 1.0 - (68.9) 462.3
Loss after tax - - - - - - - - (124.5) (124.5)
Other
comprehensive
income - - - - - (12.8) (0.7) - (8.0) (21.5)
------------------ ------------ -------- --------- ---------- --------
Total
comprehensive
income - - - - - (12.8) (0.7) - (132.5) (146.0)
Transfer of
reserves - - - - - 1.3 - - (1.3) -
Credit to share
option reserve - - - - 0.1 - - - - 0.1
Dividends paid to
equity
holders of the
Company - - - - - - - - (22.2) (22.2)
At 31 December
2019 59.2 447.3 - 0.3 1.8 10.2 0.3 - (224.9) 294.2
------------------ -------- -------- ---------- ----------- -------- ------------ -------- --------- ---------- --------
Loss after tax - - - - - - - - (139.2) (139.2)
Other
comprehensive
income/(expense) - - - - - 0.3 (0.1) - (1.0) (0.8)
------------------ -------- -------- ---------- ----------- -------- ------------ -------- --------- ----------
Total
comprehensive
income/(expense) - - - - - 0.3 (0.1) - (140.2) (140.0)
Issue of share
capital 59.0 0.4 - - - - - 92.5 - 151.9
Transfer of
unallocated
treasury shares - - (0.2) - - - - - 0.2 -
Credit to share
option reserve - - - - 0.2 - - - - 0.2
At 31 December
2020 118.2 447.7 (0.2) 0.3 2.0 10.5 0.2 92.5 (364.9) 306.3
------------------ -------- -------- ---------- ----------- -------- ------------ -------- --------- ---------- --------
The share option reserve represents the cumulative
equity-settled share option charge under IFRS 2 "Share-based
payment" less the value of any share options that have been
exercised.
The hedging and translation reserves represents movements in the
Consolidated Balance Sheet as a result of movements in exchange
rates and movements in the fair value of cash flow hedges which are
taken directly to reserves. Amounts were reclassified during the
prior year to clarify the effects of hedging between retained
(losses)/profits and the cash flow hedging reserve and to
separately identify the cash flow hedging reserve and foreign
currency retranslation reserve.
The treasury shares reserve relate to shares purchased by the
SIG Employee Share Trust to satisfy awards made under the Group's
share plans which are not vested and beneficially owned by
employees. Shares have become unallocated during the year and have
therefore been transferred to the treasury share reserve.
The merger reserve represents the premium on ordinary shares
issued during the year through the use of a cash box structure.
Consolidated Cash Flow Statement
for the year ended 31 December
2020
2020 2019
Note GBPm GBPm
-------------------------------------------- ----- --- -------- --------------
Net cash flow from operating activities
Cash (used in)/generated from
operating activities 6 (43.0) 166.0
Income tax paid (9.7) (10.8)
Net cash generated from operating
activities (52.7) 155.2
-------------------------------------------- ----- --- -------- --------------
Cash flows from investing activities
Finance income received 0.7 0.6
Purchase of property, plant and
equipment and computer software (20.8) (34.5)
Proceeds from sale of property,
plant and equipment 5.6 7.6
Net cash flow arising on the purchase
of businesses (0.8) -
Net cash flow arising on the sale
of businesses 9 147.8 8.4
Net cash flow from investing activities 132.5 (17.9)
-------------------------------------------- ----- --- -------- --------------
Cash flows from financing activities
Finance costs paid (23.3) (25.1)
Repayment of lease liabilities (54.8) (59.9)
Acquisition of non-controlling
interests - (0.9)
Repayment of loans/settlement
of derivative financial instruments (55.2) -
Additional drawdown/(repayment)
of revolving credit facility* (30.0) 42.4
Net proceeds from equity raise 151.9 -
Dividends paid to equity holders
of the Company 8 - (22.2)
Net cash flow from financing activities (11.4) (65.7)
-------------------------------------------- ----- --- -------- --------------
Increase in cash and cash equivalents
in the year 68.4 71.6
-------------------------------------------- ----- --- -------- --------------
Cash and cash equivalents at beginning
of the year 145.1 78.8
Effect of foreign exchange rate
changes 21.8 (5.3)
Cash and cash equivalents at end
of the year** 235.3 145.1
-------------------------------------------- ----- --- -------- --------------
* As part of the changes to the debt facility agreements on
18 June 2020, GBP70.0m drawn under the existing revolving credit
facility was converted into a GBP70.0m term facility, with
no additional repayment or drawdown made.
** Cash and cash equivalents comprise cash at bank and on hand
of GBP235.3m (2019: GBP145.1m) less bank overdrafts of GBPnil
(2019: GBPnil).
1. Basis of preparation
The Group's financial information has been prepared in
accordance with the recognition and measurement requirements of
international accounting standards in conformity with the
requirements of the Companies Act 2006 and international financial
reporting standards adopted pursuant to Regulation (EC) No.
1606/2002 as it applies in the European Union. It has been prepared
on a basis consistent with that adopted in the previous year.
The Financial Statements have been prepared under the historical
cost convention except for derivative financial instruments which
are stated at their fair value.
Whilst the financial information included in this Preliminary
Results Announcement has been prepared in accordance with the
recognition and measurement criteria of IFRS, this announcement
does not itself contain sufficient information to comply with
IFRS.
The Preliminary Results Announcement does not constitute the
Company's statutory accounts for the years ended 31 December 2020
and 31 December 2019 within the meaning of Section 435 of the
Companies Act 2006 but is derived from those statutory
accounts.
The Group's statutory accounts for the year ended 31 December
2019 have been filed with the Registrar of Companies, and those for
2020 will be delivered following the Company's Annual General
Meeting. The Auditor has reported on the statutory accounts for
2020 and 2019. Their report for 2020 was (i) unqualified, (ii)
included no matters to which the auditor drew attention by way of
emphasis and (iii) did not contain statements under Sections 498
(2) or 498 (3) of the Companies Act 2006 in relation to the
financial statements. Their report for 2019 contained a number of
material uncertainties in respect of going concern to which the
Auditor drew attention by way of emphasis without modifying their
report, was unqualified and did not contain statements under
Sections 498 (2) or 498 (3) of the Companies Act 2006 in relation
to the financial statements.
Going concern
The Group closely monitors its funding position throughout the
year, including monitoring compliance with covenants and available
facilities to ensure it has sufficient headroom to fund
operations.
On 18 June 2020, the Group agreed amended debt facility
agreements in respect of its Revolving Credit Facility (RCF) and
private placement notes. On 10 July 2020 the Group also completed
the successful raising of GBP165m of equity through a firm placing
and placing and open offer, in order to reduce net debt and
strengthen the Group's balance sheet.
Under the June 2020 revised debt facility agreements the Group
was subject to covenant testing as follows:
-- Leverage (net debt/EBITDA) and interest cover
(EBITA/interest) not tested until March 2022, after which tested
every quarter, the tests being applied to the prior 12 months;
-- Until 28 February 2022 the Group to ensure that Consolidated
Net Debt (CND) does not exceed GBP225m for each quarterly test date
in 2021 (2020: GBP125m);
-- Minimum Liquidity (available cash and undrawn revolving
credit facility commitments) of GBP40m at all times; and
-- Consolidated Net Worth (CNW) must at all times not be less than GBP250m.
The Group was in compliance with these covenants at 31 December
2020.
Whilst the Group has significant available liquidity, and on the
basis of current forecasts is expected to remain in compliance with
all banking covenants throughout the forecast period to 31 March
2022, on 1 March 2021 the Group agreed with its lending banks and
private placement noteholders to amend certain financial covenants
to better align the tests and to provide additional headroom on the
interest cover covenant under stress test scenarios from March
2022. The amended covenants under the revised agreements are as
follows:
-- The interest cover testing does not start until June 2022 and
is at lower levels than previously until December 2022;
-- The leverage covenant threshold is now slightly lower than
previously at March 2022 and June 2022;
-- The Consolidated Net Debt threshold is lowered to GBP200m and
extended to December 2022; and
-- No change to the CNW or Minimum Liquidity covenants.
In arriving at their opinion on going concern, the Directors
have considered the Group's forecasts for the period to 31 March
2022, and specifically the ability to meet the covenant tests
above. These forecasts reflect the assumption of more normal
trading levels since the worst of the Covid-19 impact, as well as
the expected positive impact of the strategic actions being
undertaken to improve future performance under the Return to Growth
strategy.
Management have continued to manage liquidity very closely, such
that cashflow performance was better than initial expectations
throughout 2020. The base forecasts indicate that the Group will be
able to operate within the covenants for the forecast period to 31
March 2022.
The Directors have considered the following principal risks and
uncertainties that could potentially impact the Group's ability to
fund its future activities and adhere to its future banking
covenants, including:
-- A decline in market conditions resulting in lower than forecast sales;
-- Implementation of the new strategy taking longer than
anticipated to deliver forecast increases in revenue and
profit;
-- A further wave of the Covid-19 pandemic; and
-- The terms of the Group's revised lending arrangements and
whether these could limit investment in growth opportunities.
The forecasts on which the going concern assessment is based
have been subject to sensitivity analysis and stress testing to
assess the impact of the above risks. The Group has considered a
plausible downside scenario, factoring in a reduction in sales
volumes and a reduction in gross margin, offset by reductions in
direct expenditure and discretionary operating costs. The results
showed that under this scenario the Group will still be able to
operate within the covenants with adequate headroom for the
forecast period to 31 March 2022.
In considering the impact of these stress test scenarios the
Directors have also reviewed realistic additional mitigating
actions that could be taken over and above those already included
in the downside scenario forecast to avoid or reduce the impact or
occurrence of the underlying risks. These include further
reductions to operating costs, cutting discretionary capital
expenditure and disposing of non-core assets.
On consideration of the above, the Directors believe that the
Group has adequate resources to continue in operational existence
for the forecast period to 31 March 2022 and the Directors
therefore consider it is appropriate to adopt the going concern
basis in preparing the 2020 financial statements.
New standards, interpretations and amendments adopted
The following amendments and interpretations apply for the first
time in 2020, but have not had a material impact on the Financial
Statements of the Group:
-- Amendments to IFRS 3 Definition of a Business
-- Amendments to IFRS 7, IFRS 9 and IAS 39 Interest Rate Benchmark Reform
-- Amendments to IAS 1 and IAS 8 Definition of Material
-- Conceptual Framework for Financial Reporting issued on 29 March 2018
-- Amendments to IFRS 16 Covid-19 Related Rent Concessions
New standards, amendments and interpretations not yet
adopted
At the date of authorisation of these Financial Statements, the
only standard or interpretation which is in issue but not yet
effective is Interest Rate Benchmark Reform - Phase 2 (Amendments
to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16). This is not
expected to have a material impact on the Group and has not been
early adopted by the Group.
2. Revenue and segmental information
Revenue
Total
Germany
UK UK Total France France Total and Total
Distribution Exteriors UK Distribution Exteriors France Germany Benelux Benelux Ireland Poland Eliminations Group
2020 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Type of
product
Interiors 357.4 - 357.4 168.1 - 168.1 370.7 91.6 462.3 46.3 142.6 - 1,176.7
Exteriors - 310.1 310.1 - 344.8 344.8 - - - 34.2 - - 689.1
Heating,
ventilation
and air
conditioning - - - - - - - - - - 6.9 - 6.9
Inter-segment
revenue^ 1.5 0.5 2.0 0.9 7.6 8.5 0.1 0.1 0.2 0.1 - (10.8) -
Total
underlying
revenue 358.9 310.6 669.5 169.0 352.4 521.4 370.8 91.7 462.5 80.6 149.5 (10.8) 1,872.7
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Revenue
attributable
to businesses
identified
as non-core - - - - 1.8 1.8 - - - - - - 1.8
Total 358.9 310.6 669.5 169.0 354.2 523.2 370.8 91.7 462.5 80.6 149.5 (10.8) 1,874.5
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Nature of
revenue
Goods for
resale 358.9 310.6 669.5 169.0 354.2 523.2 370.8 91.7 462.5 75.2 149.5 (10.8) 1,869.1
Construction
contracts - - - - - - - - - 5.4 - - 5.4
Total 358.9 310.6 669.5 169.0 354.2 523.2 370.8 91.7 462.5 80.6 149.5 (10.8) 1,874.5
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Timing of
revenue
recognition
Goods
transferred
at
a point in
time 358.9 310.6 669.5 169.0 354.2 523.2 370.8 91.7 462.5 75.2 149.5 (10.8) 1,869.1
Goods and
services
transferred
over time - - - - - - - - - 5.4 - - 5.4
Total 358.9 310.6 669.5 169.0 354.2 523.2 370.8 91.7 462.5 80.6 149.5 (10.8) 1,874.5
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
^ Inter-segment revenue is charged at the prevailing market
rates.
Revenue
Total
Germany
UK UK Total France France Total and Total
Distribution Exteriors UK Distribution Exteriors France Germany Benelux Benelux Ireland Poland Eliminations Group
2019 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Type of
product
Interiors 515.4 - 515.4 184.5 - 184.5 381.5 103.0 484.5 56.4 149.6 - 1,390.4
Exteriors - 346.5 346.5 - 342.2 342.2 - - - 38.5 - - 727.2
Heating,
ventilation
and air
conditioning 18.9 - 18.9 - - - - - - - 6.5 - 25.4
Inter-segment
revenue^ 11.9 9.1 21.0 0.1 0.2 0.3 1.0 0.1 1.1 - - (22.4) -
Total
underlying
revenue 546.2 355.6 901.8 184.6 342.4 527.0 382.5 103.1 485.6 94.9 156.1 (22.4) 2,143.0
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Revenue
attributable
to businesses
identified
as non-core 1.2 - 1.2 - 1.9 1.9 14.5 - 14.5 - - - 17.6
Total 547.4 355.6 903.0 184.6 344.3 528.9 397.0 103.1 500.1 94.9 156.1 (22.4) 2,160.6
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Nature of
revenue
Goods for
resale 547.4 355.6 903.0 184.6 344.3 528.9 397.0 103.1 500.1 88.7 156.1 (22.4) 2,154.4
Construction
contracts - - - - - - - - - 6.2 - - 6.2
Total 547.4 355.6 903.0 184.6 344.3 528.9 397.0 103.1 500.1 94.9 156.1 (22.4) 2,160.6
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Timing of
revenue
recognition
Goods
transferred
at
a point in
time 547.4 355.6 903.0 184.6 344.3 528.9 397.0 103.1 500.1 88.7 156.1 (22.4) 2,154.4
Goods and
services
transferred
over time - - - - - - - - - 6.2 - - 6.2
Total 547.4 355.6 903.0 184.6 344.3 528.9 397.0 103.1 500.1 94.9 156.1 (22.4) 2,160.6
--------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
^ Inter-segment revenue is charged at the prevailing market
rates.
Segmental Information
In accordance with IFRS 8 "Operating Segments", the Group identifies its reportable operating segments based on the
way in which financial information is reviewed and
business performance is assessed by the Chief Operating
Decision Maker "CODM".
a) Segmental
analysis
Total
Germany
UK UK Total France France Total and Total
Distribution Exteriors UK Distribution Exteriors France Germany Benelux Benelux Ireland Poland Eliminations Group
2020 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
---------------- ------------- ---------- -------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Revenue
Underlying
revenue 357.4 310.1 667.5 168.1 344.8 512.9 370.7 91.6 462.3 80.5 149.5 - 1,872.7
Revenue
attributable
to businesses
identified
as non-core - - - - 1.8 1.8 - - - - - - 1.8
Inter-segment
revenue^ 1.5 0.5 2.0 0.9 7.6 8.5 0.1 0.1 0.2 0.1 - (10.8) -
Total revenue 358.9 310.6 669.5 169.0 354.2 523.2 370.8 91.7 462.5 80.6 149.5 (10.8) 1,874.5
---------------- ------------- ---------- -------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Segment result
before
Other items (45.4) (7.4) (52.8) 7.1 8.3 15.4 0.4 2.5 2.9 0.8 2.0 - (31.7)
Amortisation of
acquired
intangibles (0.9) (4.3) (5.2) - (0.4) (0.4) - - - - - - (5.6)
Impairment
charges (50.6) (11.8) (62.4) - - - - - - - - - (62.4)
Acquisition
costs - (0.2) (0.2) - - - - - - - - - (0.2)
Profits and
losses on
agreed sale or
closure
of non-core
businesses (0.3) - (0.3) - (0.9) (0.9) - - - - - - (1.2)
Net operating
losses
attributable
to businesses
identified as
non-core - - - - (0.3) (0.3) - - - - - - (0.3)
Onerous
contract costs (1.0) - (1.0) - - - - - - - - - (1.0)
Net
restructuring
costs (4.0) (1.7) (5.7) - (0.1) (0.1) (0.5) (0.4) (0.9) - - - (6.7)
Other specific
items (0.1) - (0.1) - 0.1 0.1 0.2 - 0.2 - - - 0.2
Segment
operating
profit/(loss) (102.3) (25.4) (127.7) 7.1 6.7 13.8 0.1 2.1 2.2 0.8 2.0 - (108.9)
---------------- ------------- ---------- -------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Parent Company
costs (21.6)
Parent Company
other
items* (37.2)
Operating loss (167.7)
---------------- ------------- ---------- -------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Net finance
costs before
Other items (23.0)
Non-underlying
finance
costs (11.6)
Loss before tax
and
discontinued
operations (202.3)
---------------- ------------- ---------- -------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Income tax
expense (6.6)
Profit from
discontinued
operations 69.7
Loss for the
year (139.2)
---------------- ------------- ---------- -------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
^ Inter-segment revenue is charged at the prevailing market
rates.
* Parent company Other items include impairment charges
GBP13.7m, investment in omnichannel retailing GBP4.2m, costs
associated with refinancing GBP7.4m, onerous contract costs
GBP12.2m and other specific items GBP1.6m, offset by profit on
agreed sale or closure of non-core businesses of GBP1.9m.
Total
Germany
UK UK Total France France Total and Total
Distribution Exteriors UK Distribution Exteriors France Germany Benelux Benelux Ireland Poland Eliminations Group
2019 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------- ------------- ---------- ------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Revenue
Underlying
revenue 534.3 346.5 880.8 184.5 342.2 526.7 381.5 103.0 484.5 94.9 156.1 - 2,143.0
Revenue
attributable
to businesses
identified
as non-core 1.2 - 1.2 - 1.9 1.9 14.5 - 14.5 - - - 17.6
Inter-segment
revenue^ 11.9 9.1 21.0 0.1 0.2 0.3 1.0 0.1 1.1 - - (22.4) -
Total revenue 547.4 355.6 903.0 184.6 344.3 528.9 397.0 103.1 500.1 94.9 156.1 (22.4) 2,160.6
--------------- ------------- ---------- ------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Segment result
before
Other items 7.9 11.8 19.7 11.2 8.6 19.8 4.4 5.2 9.6 6.8 4.3 - 60.2
Amortisation
of acquired
intangibles (0.9) (4.4) (5.3) - (0.7) (0.7) - (0.2) (0.2) - - - (6.2)
Impairment
charges (58.2) (0.5) (58.7) - (32.2) (32.2) - - - - - - (90.9)
Profits and
losses on
agreed sale
or closure
of non-core
businesses
and
associated
impairment
charges (0.9) (1.6) (2.5) - (1.6) (1.6) 6.0 - 6.0 (1.8) - - 0.1
Net operating
losses
attributable
to businesses
identified as
non-core (0.8) - (0.8) - (0.9) (0.9) 0.8 - 0.8 - - - (0.9)
Net
restructuring
costs (10.2) (8.0) (18.2) - (2.1) (2.1) (6.6) (0.2) (6.8) - - - (27.1)
Other specific
items 0.2 - 0.2 - (0.2) (0.2) (0.1) - (0.1) (0.3) - - (0.4)
Segment
operating
profit/(loss) (62.9) (2.7) (65.6) 11.2 (29.1) (17.9) 4.5 4.8 9.3 4.7 4.3 - (65.2)
--------------- ------------- ---------- ------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Parent Company
costs (17.7)
Investment in
omnichannel
retailing (5.7)
Movement in
fair value
of forward
currency
option 0.7
Operating loss (87.9)
--------------- ------------- ---------- ------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Net finance
costs before
Other items (24.8)
Loss before
tax and
discontinued
operations (112.7)
--------------- ------------- ---------- ------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
Income tax
expense (11.4)
Loss from
discontinued
operations (0.4)
Loss for the
year (124.5)
--------------- ------------- ---------- ------- ------------- ---------- ------- -------- -------- -------- -------- ------- ------------- --------
^ Inter-segment revenue is charged at the prevailing market
rates.
Balance Sheet
Total
Germany
UK UK Total France France Total and
Distribution Exteriors UK Distribution Exteriors France Germany Benelux Benelux Ireland Poland Total
2020 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
-------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- --------
Balance sheet
Assets
Segment
assets 153.2 242.8 396.0 67.6 210.6 278.2 138.1 48.7 186.8 52.6 59.5 973.1
Unallocated
assets:
Right-of-use
assets 1.4
Property,
plant and
equipment 0.3
Derivative
financial
instruments 0.1
Cash and cash
equivalents 174.9
Other assets 4.8
-------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- --------
Consolidated
total assets 1,154.6
-------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- --------
Liabilities
Segment
liabilities 188.3 112.1 300.4 48.8 104.9 153.7 79.5 9.6 89.1 31.9 28.3 603.4
Unallocated
liabilities:
Private
placement
notes 144.5
Bank loans 67.7
Derivative
financial
instruments 0.9
Other
liabilities 31.8
-------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- --------
Consolidated
total
liabilities 848.3
-------------- ------------- ---------- ------ ------------- ---------- ------- -------- -------- -------- -------- ------- --------
Balance sheet
Total
Germany
UK Total France France Total and
Distribution UK Exteriors UK Distribution Exteriors France Germany Benelux Benelux Ireland Poland Total
2019 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------------- ------------- ------------------ ------------- ------------- ---------- -------- -------- --------- -------- -------- --------- ----------
Balance sheet
Assets
Segment assets 268.3 204.1 472.4 57.5 211.1 268.6 154.0 51.6 205.6 56.0 66.5 1,069.1
Unallocated assets:
Right-of-use assets 2.9
Property, plant and
equipment 0.4
Derivative financial
instruments 2.6
Cash and cash
equivalents (3.6)
Deferred tax assets 4.4
Assets held for sale 258.4
Other assets 13.6
--------------------- ------------- ------------------ ------------- ------------- ---------- -------- -------- --------- -------- -------- --------- ----------
Consolidated total
assets 1,347.8
--------------------- ------------- ------------------ ------------- ------------- ---------- -------- -------- --------- -------- -------- --------- ----------
Liabilities
Segment liabilities 196.9 83.5 280.4 54.8 97.4 152.2 96.4 16.4 112.8 36.1 35.7 617.2
Unallocated
liabilities:
Private placement
notes 175.5
Bank loans 99.6
Derivative financial
instruments 2.1
Liabilities held for
sale 115.7
Other liabilities 43.5
--------------------- ------------- ------------------ ------------- ------------- ---------- -------- -------- --------- -------- -------- --------- ----------
Consolidated total
liabilities 1,053.6
--------------------- ------------- ------------------ ------------- ------------- ---------- -------- -------- --------- -------- -------- --------- ----------
Total
Germany
UK UK Total France France Total and Parent Total
Distribution Exteriors UK Distribution Exteriors France Germany Benelux Benelux Ireland Poland company Group
2020 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------------- ------------- ---------- ------ ------------- ------------- ---------- -------- -------- --------- -------- -------- --------- --------
Other segment
information
Capital expenditure
on:
Property, plant and
equipment 4.4 3.9 8.3 0.3 2.4 2.7 0.9 0.7 1.6 0.4 0.2 0.1 13.3
Computer software 1.9 1.2 3.1 - - - 0.2 - 0.2 0.3 - 5.1 8.7
Goodwill and
intangible
assets (excluding
computer
software) - 1.8 1.8 - - - - - - - - - 1.8
Non-cash
expenditure:
Depreciation of
fixed
assets 3.3 2.5 5.8 0.6 1.5 2.1 1.7 0.6 2.3 0.5 0.4 0.1 11.2
Depreciation of
right-of-use
assets 15.2 8.0 23.2 5.1 8.6 13.7 12.9 1.6 14.5 1.7 3.2 0.3 56.6
Impairment of
right-of-use
assets 10.2 - 10.2 - - - - - - - - - 10.2
Impairment of
property,
plant and equipment
and computer
software 4.9 - 4.9 - - - - - - - - 13.7 18.6
Amortisation of
acquired
intangibles and
computer
software 4.5 4.9 9.4 - 0.4 0.4 - - - 0.2 0.1 0.9 11.0
Impairment of
goodwill
and intangibles
(excluding
computer software) 35.5 11.8 47.3 - - - - - - - - - 47.3
--------------------- ------------- ---------- ------ ------------- ------------- ---------- -------- -------- --------- -------- -------- --------- --------
Total
Germany
UK UK Total France France Total and Parent Total
Distribution Exteriors UK Distribution Exteriors France Germany Benelux Benelux Ireland Poland company Group
2019 GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------------- ------------- ---------- ------ ------------- ------------- ---------- -------- -------- --------- -------- -------- --------- --------
Other segment
information
Capital expenditure
on:
Property, plant and
equipment 2.4 6.5 8.9 0.8 0.9 1.7 1.3 0.3 1.6 0.7 2.2 - 15.1
Computer software 5.1 1.2 6.3 - - - 0.1 - 0.1 0.4 - 9.9 16.7
Non-cash
expenditure:
Depreciation 19.1 10.6 29.7 5.2 10.0 15.2 13.8 2.4 16.2 2.8 3.5 0.4 67.8
Impairment of
right-of-use
assets 0.5 0.5 1.0 - 0.5 0.5 - - - - - - 1.5
Impairment of
property,
plant and equipment
and computer
software 0.9 - 0.9 - - - - - - - - - 0.9
Amortisation of
acquired
intangibles and
computer
software 3.5 4.5 8.0 - 0.7 0.7 0.1 0.2 0.3 - 0.1 0.8 9.9
Impairment of
goodwill
and intangibles
(excluding
computer software) 57.4 - 57.4 - 33.3 33.3 - - - - - - 90.7
--------------------- ------------- ---------- ------ ------------- ------------- ---------- -------- -------- --------- -------- -------- --------- --------
Geographic information
The Group's non-current operating assets (including property, plant and equipment, right-of-use
assets, goodwill and intangible assets but excluding lease receivables, deferred tax and derivative
financial instruments) by geographical location are as follows:
-----------------------------------------------------------------------------------------------------------
2020 2019
Non-current assets Non-current assets
Country GBPm GBPm
----------------------------------------------------------- ---------------------- ----------------------
United Kingdom 222.0 283.4
Ireland 14.6 15.7
France 113.4 112.0
Germany 59.5 66.2
Poland 13.4 14.2
Benelux 21.6 23.4
Total underlying 444.5 514.9
----------------------------------------------------------- ---------------------- ----------------------
Attributable to businesses identified as non-core - 0.2
Attributable to businesses held for sale - 112.9
Total 444.0 628.0
----------------------------------------------------------- ---------------------- ----------------------
3. Other operating expenses
3a. Analysis of other operating
expenses
------------- ------------ ----------- ------------- ------------ -----------
2020 2019
---------------------------------------- ----------------------------------------
Before Other Before Other
items Other items Total items Other items Total
GBPm GBPm GBPm GBPm GBPm GBPm
-------------------------------- ------------- ------------ ----------- ------------- ------------ -----------
Other operating expenses:
- distribution costs 261.4 7.1 268.5 207.6 27.5 235.1
- selling and marketing costs 138.8 0.4 139.2 179.6 3.0 182.6
- management, administrative
and central
costs 123.3 107.6 230.9 126.0 103.6 229.6
- property profits (0.2) (0.2) (0.4) (0.3) - (0.3)
Total 523.3 114.9 638.2 512.9 134.1 647.0
-------------------------------- ------------- ------------ ----------- ------------- ------------ -----------
3b. Other items
Profit/(loss) after tax includes the following Other items which have been disclosed in a separate
column within the Consolidated Income Statement in order to provide a better indication of the
underlying earnings of the Group (as explained in the Statement of Accounting Policies):
--------------------------------------------------------------------------------------------------------------------
2020 2019
---------------------------------------- ----------------------------------------
Other items Tax impact Tax impact Other items Tax impact Tax impact
GBPm GBPm % GBPm GBPm %
-------------------------------- ------------- ------------ ----------- ------------- ------------ -----------
Amortisation of acquired
intangibles (5.6) 1.1 19.6% (6.2) 1.4 22.6%
Impairment charges(1) (76.1) - - (90.9) 0.2 0.2%
Profits and losses on agreed
sale or
closure of non-core businesses 0.6 - - 0.1 (0.8) 800.0%
Net operating profits/(losses)
attributable
to businesses identified as
non-core(2) (0.3) - - (0.9) 0.1 11.1%
Net restructuring costs(3) (6.7) 1.0 14.9% (27.1) 4.4 16.2%
Investment in omnichannel
retailing (4.2) - - (5.7) - -
Costs associated with
refinancing(4) (7.4) 1.4 18.9% - - -
Onerous contract costs(5) (13.2) 0.3 2.3% - - -
Other specific items(6) (1.5) 0.2 13.3% 0.3 - -
-------------------------------- ------------- ------------ ----------- ------------- ------------ -----------
Impact on operating
profit/(loss) (114.4) 4.0 3.5% (130.4) 5.3 4.1%
Non-underlying finance costs(7) (11.6) 0.1 0.9% - - -
-------------------------------- ------------- ------------ ----------- ------------- ------------ -----------
Impact on profit/(loss) before
tax (126.0) 4.1 3.3% (130.4) 5.3 4.1%
Other tax adjustments in
respect of
previous years - - - - (0.4) -
Impact on profit/(loss) after
tax (126.0) 4.1 3.3% (130.4) 4.9 3.8%
-------------------------------- ------------- ------------ ----------- ------------- ------------ -----------
(1) Impairment charges comprises GBP45.4m (2019: GBP89.6m) related to goodwill, GBP1.9m customer
relationships in intangibles, GBP13.7m related to SAP 1HANA implementation costs, GBP1.4m (2019:
GBP0.3m) other software costs, GBP3.5m tangible fixed assets and GBP10.2m (2019: GBP1.0m) right-of-use
assets.
(2) The comparatives for 31 December 2019 for net operating profit/(losses) attributable to
businesses identified as non-core are updated to reflect non-core businesses on a consistent
basis with the current year.
(3) Included within net restructuring costs are property closure costs of GBP0.8m (2019: GBP6.0m),
redundancy and related staff costs of GBP2.8m (2019: GBP9.5m), GBP2.9m (2019: GBP9.6m) in relation
to restructuring consultancy costs and GBP0.2m (2019: GBP2.0m) other costs. These costs have
been incurred in connection with the prior year target operating model projects in the UK, Germany
and France, the current year restructuring of the UK businesses as part of implementation of
the Return to Growth strategy, and restructuring in Benelux.
(4) Costs associated with refinancing includes legal and professional fees of GBP8.3m offset
by GBP0.9m gain in relation to the partial derecognition of a cash flow hedging arrangement as
a result of the change in debt facility agreements.
(5) Onerous contract costs includes GBP11.4m (2019: GBPnil) relating to provisions recognised
for licence fee commitments where no future economic benefit is expected to be obtained, principally
in relation to the SAP 1HANA implementation together with GBP1.8m licence fees recognised in
the consolidated income statement during the year whilst the project was on hold.
(6) Other specific items comprises
the following:
---------------------------------------- ------ ------
2020 2019
GBPm GBPm
---------------------------------------- ------ ------
PwC investigation costs (1.8) -
Gain on fair value of forward currency
option not hedged 0.6 0.7
Costs in relation to the cyber attack
in France 0.1 (0.6)
GMP equalisation (0.4) -
Acquisition costs (0.2) -
Other specific items 0.2 0.2
Total other specific items (1.5) 0.3
-------------------------------------------- ------ ------
(7) Non-underlying finance costs comprise GBP11.3m loss on
modification recognised in relation the private placement notes and
GBP0.3m write-off of arrangement fees in relation to the previous
RCF which has been extinguished.
4. Income tax
The income tax expense
comprises:
----------------------------- -------------------------- ------ ------
2020 2019
GBPm GBPm
----------------------------- -------------------------- ------ ------
Current tax
UK & Ireland corporation
tax: - charge for the year 0.5 0.8
- adjustments in respect
of previous years - (0.1)
-------------------------------------------------------- ------ ------
0.5 0.7
Mainland Europe corporation
tax - charge for the year 5.6 6.8
- adjustments in respect
of previous years (0.1) 2.7
-------------------------------------------------------- ------ ------
5.5 9.5
Total current tax 6.0 10.2
--------------------------------------------------------- ------ ------
Deferred tax
Current year (2.2) 5.3
Adjustments in respect
of previous years 2.6 0.8
Deferred tax charge in respect of pension schemes - (3.9)
Effect of change in rate 0.2 (1.0)
Total deferred tax 0.6 1.2
--------------------------------------------------------- ------ ------
Total income tax expense 6.6 11.4
--------------------------------------------------------- ------ ------
As the Group's profits and losses are earned across a number
of tax jurisdictions an aggregated income tax reconciliation
is disclosed, reflecting the applicable rates for the countries
in which the Group operates.
The total tax charge for the year differs from the expected
tax using a weighted average tax rate which reflects the applicable
statutory corporate tax rates on the accounting profits/losses
in the countries in which the Group operates. The differences
are explained in the following aggregated reconciliation of
the income tax expense:
---------------------------------------------------------------------------------------------------
2020 2019
GBPm % GBPm %
--------------------------------------------------------- ---------- -------- -------- --------
Loss before tax from continuing
operations (202.3) (112.7)
Profit before tax from discontinued
operations 72.0 3.8
--------------------------------------------------------- ---------- -------- -------- --------
Loss before tax (130.3) (108.9)
--------------------------------------------------------- ---------- -------- -------- --------
Expected tax credit (14.2) 10.9% (23.2) 21.3%
Factors affecting the income tax
expense for the year:
- expenses not deductible for
tax purposes^ 19.6 (15.0)% 7.5 (6.9)%
- non-taxable income* (33.2) 25.5% (4.5) 4.1%
- impairment and disposal charges
not deductible for tax purposes** 15.9 (12.2)% 22.4 (20.6)%
- deductible temporary differences
not recognised for deferred tax
purposes 18.1 (13.9)% 10.5 (9.6)%
- other adjustments in respect
of previous years 2.5 (1.9)% 3.7 (3.4)%
- tax on branch profits - - 0.1 (0.1)%
- effect of change in rate on
deferred tax 0.2 (0.2)% (0.9) 0.8%
Total income tax expense 8.9 (6.8)% 15.6 (14.3)%
--------------------------------------------------------- ---------- -------- -------- --------
Income tax expense reported in
the consolidated income statement 6.6 11.4
Income tax attributable to a discontinued
operation 2.3 4.2
8.9 15.6
---------- --------
^ The majority of the Group's expenses that are not deductible
for tax purposes are in relation to the divestments of businesses,
internal restructuring and impairments of property.
* The majority of the Group's non-taxable income relates to
the divestments of businesses.
** During the year the Group incurred impairment charges of
GBP45.4m in relation to goodwill which are not deductible for
tax purposes.
The effective tax rate for the Group on the total loss before
tax of GBP130.3m (2019: GBP108.9m) is negative 6.8% (2019: negative
14.3%). As the Group operates in several different countries
tax losses cannot be surrendered or utilised cross border, and
the Group therefore is subject to tax in some countries and
not in others. Tax losses are not currently recognised in respect
of the UK business, which also impacts the overall effective
tax rate. The combination of these factors means that the effective
tax rate is less meaningful as an indicator or comparator for
the Group.
Factors that will affect the Group's future total tax charge
as a percentage of underlying profits are:
- the mix of profits and losses between the tax jurisdictions
in which the Group operates; in particular the tax rates in
France, Germany and Belgium are relatively high when compared
to the UK and so a higher proportion of profits in these jurisdictions
could result in a higher Group tax charge;
- the impact of non-deductible expenditure and non-taxable
income;
- agreement of open tax computations with the respective tax
authorities; and
- the recognition or utilisation (with corresponding reduction
in cash tax payments) of unrecognised deferred tax assets.
On 25 April 2019, the European Commission ("EC") concluded its
investigation into the UK's controlled foreign company ("CFC")
tax rules. The EC concluded that the UK's CFC rules, which provide
an exemption for 75% of the CFC charge where the CFC is carrying
out financing activities, were in breach of EU State Aid. The
UK Government disagrees with this conclusion and has applied
to have this judgement annulled. In the meantime, the Group
is continuing to review the specific facts and circumstances
of its position in conjunction with professional advisors (having
claimed the exemption in historic periods). Based on the initial
assessment undertaken to date, a provision is not deemed to
be required. However, should the UK Government be unsuccessful
in appeal and all CFC profits deemed taxable in the UK, this
would give rise to additional UK tax payable of up to a maximum
of GBP5m (before interest and penalties).
In addition to the amounts charged to the Consolidated Income
Statement, the following amounts in relation to taxes have been
recognised in the Consolidated Statement of Comprehensive Income,
with the exception of deferred tax on share options which has
been recognised in the Consolidated Statement of Changes in
Equity:
---------------------------------------------------------------------------------------------------
2020 2019
GBPm GBPm
--------------------------------------------------------- ---------- -------- -------- --------
Deferred tax movement associated with remeasurement
of defined benefit pension liabilities* 0.3 (6.6)
Tax credit associated with remeasurement of defined
benefit pension liabilities* 0.4 0.4
Tax charge on exchange and fair value movements
arising on borrowings and derivative financial
instruments - (2.1)
Total 0.7 (8.3)
--------------------------------------------------------- ---------- -------- -------- --------
* These items will not subsequently be reclassified to the Consolidated
Income Statement.
5. Earnings/(loss) per share
The calculations of earnings/(loss) per share are based on the
following profits/(losses) and numbers of shares:
Basic and diluted
---------------------------
2020 2019
GBPm GBPm
------------------------------------------------------- ------------ -------------
Loss attributable to ordinary equity holders
of the parent for basic and diluted earnings
per share from continuing operations (208.9) (124.1)
Profit/(loss) attributable to ordinary
equity holders of the parent from discontinued
operations 69.7 (0.4)
------------------------------------------------------- ------------ -------------
Loss attributable to ordinary equity holders
of the parent for basic and diluted earnings
per share (139.2) (124.5)
------------------------------------------------------- ------------ -------------
Basic and diluted before
Other items
---------------------------
2020 2019
GBPm GBPm
------------------------------------------------------- ------------ -------------
Loss attributable to ordinary equity holders
of the parent for basic and diluted earnings
per share from continuing operations (208.9) (124.1)
Add back:
Other items 121.9 125.5
(Loss)/profit attributable to ordinary
equity holders of the parent for basic
and diluted earnings per share from continuing
operations before other items (87.0) 1.4
------------------------------------------------------- ------------ -------------
2020 2019
Weighted average number of shares Number Number
------------------------------------------------------- ------------ -------------
For basic and diluted earnings/(loss) per
share 871,941,603 591,556,982
Effect of dilution from share options 1,405,503 -
------------------------------------------------------- ------------ -------------
Adjusted for the effect of dilution 873,347,106 591,556,982
------------------------------------------------------- ------------ -------------
The weighted average number of shares excludes those held by
the SIG Employee Share Trust ("the EBT") which are not vested
and beneficially owned by employees. The weighted average number
of shares has increased due to the equity raise which completed
on 10 July 2020 with 589,999,995 new ordinary shares issued
for gross proceeds of GBP165m.
--------------------------------------------------------------------------------------
2020 2019
------------------------------------------------------- ------------ -------------
Loss per share
From continuing operations:
Basic loss per share (24.0)p (21.0)p
Diluted loss per share (23.9)p (21.0)p
Total:
Basic loss per share (16.0)p (21.0)p
Diluted loss per share (15.9)p (21.0)p
(Loss)/earnings per share before Other
items^
Basic (loss)/earnings per share from continuing
operations before Other items (10.0)p 0.2p
------------------------------------------------------- ------------ -------------
^ (Loss)/earnings per share before Other items (also referred to
as underlying (loss)/earnings per share) has been disclosed in
order to present the underlying performance of the Group.
6. Reconciliation of loss before tax to cash generated from operating activities
2020 2019
GBPm GBPm
-------------------------------------------------------- --------- ---------
Loss before tax from continuing operations (202.3) (112.7)
Profit before tax from discontinued operations 72.0 3.8
-------------------------------------------------------- --------- ---------
Loss before tax (130.3) (108.9)
Depreciation of property, plant and equipment 11.2 15.2
Depreciation of right-of-use assets 57.2 61.0
Net finance costs 34.6 26.3
Amortisation of computer software 5.4 4.5
Amortisation of acquired intangibles 5.6 8.1
Impairment of computer software 15.1 0.3
Impairment of property, plant and equipment 3.5 0.6
Impairment of goodwill 45.4 89.6
Impairment of acquired intangibles 1.9 -
Impairment of right-of-use asset 10.2 1.0
Profit on agreed sale or closure of non-core
businesses (Note 9) (71.6) (0.1)
Loss/(profit) on sale of property, plant
and equipment 0.7 (1.4)
Share-based payments 0.2 0.1
Gains on derivative financial instruments (1.5) -
Net foreign exchange differences 0.2 (1.3)
Increase/(decrease) in provisions 11.3 (2.9)
Working capital movements:
- (Increase)/decrease in inventories (5.4) 1.7
- Decrease in receivables 19.7 95.6
- Decrease in payables (56.4) (23.4)
Cash (used in)/generated from operating
activities (43.0) 166.0
-------------------------------------------------------- --------- ---------
Included within the cash (used in)/generated from operating activities
is a defined benefit pension scheme employer's contribution of
GBP2.5m (2019: GBP2.5m).
Of the total loss on sale of property, plant and equipment, GBP0.2m
profit (2019: GBPnil) has been included within Other items in
the Consolidated Income Statement.
7. Reconciliation of net cash flow to movements in net debt
2020 2019
GBPm GBPm
-------------------------------------------------------------- -------- -----------
Increase in cash and cash equivalents in
the year 68.4 71.6
Cash flow from decrease in debt 183.0 (37.6)
-------------------------------------------------------------- -------- -----------
Decrease in net debt resulting from cash
flows 251.4 34.0
Recognition of deferred consideration (0.9) -
Non-cash items^ (39.3) (6.4)
Exchange differences 6.0 6.8
-------------------------------------------------------------- -------- -----------
Decrease in net debt in the year 217.2 34.4
-------------------------------------------------------------- -------- -----------
Net debt at 1 January (455.4) (189.4)
-------------------------------------------------------------- -------- -----------
Impact of adoption of IFRS 16 at 1 January
2019 - (300.4)
-------------------------------------------------------------- -------- -----------
Net debt at 31 December (238.2) (455.4)
^ Non-cash items include the fair value movement of debt recognised
in the year which does not give rise to a cash inflow or outflow,
the movement in cash restricted for use in relation to the
asset backed funding arrangement implemented in relation to
the UK defined benefit pension plan and non-cash movements
in relation to lease liabilities. In 2019 the GBP8.1m restricted
cash was included within cash and cash equivalents on the consolidated
balance sheet but deducted in arriving at net debt above as
shown below. The balance at 31 December 2020 is GBPnil.
Net debt is defined as follows:
-------------------------------------------------------------------------------------
2020 2019
GBPm GBPm
-------------------------------------------------------------- -------- -----------
Non-current assets:
Derivative financial instruments 0.1 1.7
Lease receivables 3.6 4.4
Current assets:
Derivative financial instruments - 0.9
Lease receivables 0.7 0.8
Cash at bank and on hand 235.3 110.0
Less restricted cash in relation to asset
backed funding arrangement - (8.1)
Financial assets held for sale - 35.9
Current liabilities:
Lease liabilities (50.6) (51.5)
Bank loans - (99.6)
Private placement notes - (175.5)
Deferred consideration (0.5) -
Other financial liabilities (0.5) (1.5)
Derivative financial instruments (0.5) (0.2)
Lease liabilities directly associated with
liabilities classified as held for sale - (45.3)
Non-current liabilities:
Lease liabilities (211.6) (224.1)
Bank loans (67.7) -
Private placement notes (144.5) -
Deferred consideration (0.4) -
Derivative financial instruments (0.4) (1.9)
Other financial liabilities (1.2) (1.4)
Net debt (238.2) (455.4)
-------------------------------------------------------------- -------- -----------
8. Dividends
No interim dividend was paid for the year ended 31 December 2020
(2019: 1.25p per share amounting to GBP7.4m) and no final dividend
proposed. No final dividend was proposed or paid for the year ended
31 December 2019. Total dividends paid during the year were GBPnil
(2019: GBP22.2m). No dividends have been paid between 31 December
2020 and the date of signing the Financial Statements.
9. Divestments and exit of non-core
businesses
The Group has recognised a net gain of GBP0.6m (2019: gain of
GBP0.1m) in respect of profits and losses on agreed sale or
closure of non-core businesses within Other items of the Consolidated
Income Statement. This consists of GBP2.0m gain in relation
to the disposal of the Middle East entity in the current year,
offset by costs of GBP0.2m in relation to the disposal of Building
Solutions which was due to complete in the first half of 2020
but was terminated in May 2020, a loss on the sale of the Maury
business of GBP0.9m and other costs in relation to previous
disposals of GBP0.3m. These are explained further below.
The sale of the Air Handling business also completed in the
period and the gain on sale is included with the results from
discontinued operations (Note 10).
Businesses disposed during the year
As disclosed in the 2019 Annual Report and Accounts, the Middle
East business, which was in the process of being closed, was
sold on 22 January 2020 for AED1. A gain on sale of GBP2.0m
has been recognised, in relation to the reclassification to
the Consolidated Income Statement of the cumulative exchange
differences on the retranslation of the net assets of the business
previously recognised in other comprehensive income in accordance
with IAS 21 "The effects of foreign exchange rates".
On 10 September 2020 the Group completed the sale of Maury NZ
SAS ('Maury'), the Group's high-end fabrication business in
France and part of the France Exteriors (Larivière) segment,
for proceeds of EUR25,000. An overall loss on sale of GBP0.9m
has been recognised within Other items, including the reclassification
of the cumulative exchange differences on the retranslation
of the net assets from equity to the Consolidated Income Statement,
in accordance with IAS 21 "The effects of changes in foreign
exchange rates". Net assets at the date of disposal were GBP0.9m
and costs of less than GBP0.1m were incurred, resulting in the
overall loss on sale of GBP0.9m.
Costs of GBP0.2m have also been recognised during the period
in relation to the disposal of the Building Solutions business,
which was classified as held for sale at 31 December 2019 as
a sale had been agreed and was due to complete in first half
of 2020 subject to approval from the UK Competition and Markets
Authority (CMA). As disclosed in the 2019 Annual Report and
Accounts, on 21 May 2020 it was announced that the parties had
agreed to terminate the sales agreement as terms could not be
agreed for an extension to enable completion of the CMA investigation
and the disposal is no longer proceeding. The business no longer
meets the criteria to be presented as held for sale at 31 December
2020 and is now included within underlying operations. GBP0.3m
costs have also been incurred and recognised within Other items
in relation to the Commercial Drainage business which was closed
in the prior year.
Prior year divestments
WeGo FloorTec
On 13 August 2019 the Group completed the sale of WeGo FloorTec
GmbH, the German raised access flooring division, for proceeds
of EUR13.5m plus settlement of intercompany balances. An overall
gain on sale of GBP6.0m has been recognised within Other items,
including the reclassification of the cumulative exchange differences
on the retranslation of the net assets from equity to the consolidated
income statement, in accordance with IAS 21 "The effects of
changes in foreign exchange rates".
The net assets at the date of disposal were as follows:
---------------------------------------------------------------------------------------
At date
of disposal
GBPm
-------------------------------------------------------- --- ------------------
Attributable goodwill and intangible
assets 0.4
Property, plant and equipment 0.8
Cash 0.4
Inventories 3.3
Trade and other receivables 2.4
Trade and other payables (2.4)
Net assets 4.9
------------------------------------------------------------------- ------------------
Other costs 0.9
Gain on disposal 6.0
Sale proceeds 11.8
------------------------------------------------------------------- ------------------
Satisfied by:
Cash and cash equivalents 11.8
------------------------------------------------------------------- ------------------
Commercial Drainage
The Group closed its Commercial Drainage business, part of the
UK Distribution segment, in 2019. Operating losses for the year
were included in Other items in the Consolidated Income Statement
and GBP0.9m of costs were also incurred in 2019 and included in
Other items.
Disposal groups held for sale at 31 December 2019
Building Solutions
On 7 October 2019, the Group announced the sale of Building
Solutions (National) Limited ("Building Solutions"), a subsidiary
of SIG Trading Limited, for proceeds of GBP37.5m. At 31 December
2019 the assets and liabilities were classified as held for
sale on the Consolidated Balance Sheet, as shown below. Costs
of GBP1.6m in relation to the disposal are included in Other
items in the Consolidated Income Statement. The sale was subsequently
terminated as disclosed in Note 34 of the 2019 Annual Report
and Accounts.
Air Handling
On 7 October 2019, the Group announced that it had agreed a
sale of the Air Handling business and the sale completed on
31 January 2020. This business was a major line of business
of the Group and is therefore classified as a discontinued operation.
Total assets and liabilities held for sale at 31 December 2019
comprised the following:
Air Building
Handling Solutions Other Total
GBPm GBPm GBPm GBPm
Goodwill and intangible
assets 33.2 12.5 - 45.7
Property, plant and equipment 15.1 6.2 1.9 23.2
Right-of-use assets 31.5 12.5 - 44.0
Inventories 33.9 3.8 - 37.7
Trade and other receivables 58.9 8.5 - 67.4
Contract assets 1.5 - - 1.5
Deferred tax asset 1.3 1.7 - 3.0
Deferred consideration 0.8 - - 0.8
Cash at bank and on hand 28.8 6.3 - 35.1
------------------------------------ ---------- ----------- ----------- --------
Assets held for sale 205.0 51.5 1.9 258.4
------------------------------------ ---------- ----------- ----------- --------
Trade and other payables (46.0) (15.3) - (61.3)
Contract liabilities (1.5) - - (1.5)
Lease liabilities (31.9) (13.4) - (45.3)
Deferred tax liability (1.0) - - (1.0)
Corporation tax liability (1.2) - - (1.2)
Retirement benefit obligations (3.4) - - (3.4)
Provisions (1.5) (0.5) - (2.0)
------------------------------------ ---------- ----------- ----------- --------
Liabilities directly associated
with assets held for sale (86.5) (29.2) - (115.7)
------------------------------------ ---------- ----------- ----------- --------
Net assets directly associated
with disposal groups 118.5 22.3 1.9 142.7
------------------------------------ ---------- ----------- ----------- --------
Contribution to revenue and operating loss
The results of the above businesses for the current and prior
periods have been disclosed within Other items in the Consolidated
Income Statement in order to provide an indication of the
underlying earnings of the Group. The revenue and net operating
profit/(loss) of the non-core businesses for the years ended 31
December 2020 and 31 December 2019 are as follows:
2020 2019
Net operating Net operating
Revenue profit/(loss) Revenue profit/(loss)
GBPm GBPm GBPm GBPm
-------------------------------- ---- ------------ --------------- -------- ---------------
Commercial Drainage - - 1.2 (0.8)
WeGo FloorTec - - 14.5 0.8
Building Solutions - - 58.3 2.9
Maury 1.8 (0.3) 1.9 (0.9)
Businesses identified as
non-core in 2019 1.8 (0.3) 75.9 2.0
-------------------------------------- ------------ --------------- -------- ---------------
Reclassification of Building
Solutions - - (58.3) (2.9)
-------------------------------------- ------------ --------------- -------- ---------------
Total attributable to non-core
businesses in 2020 1.8 (0.3) 17.6 (0.9)
-------------------------------------- ------------ --------------- -------- ---------------
Cash flows associated with divestments and exit of non-core
businesses
The net cash inflow in the year ended 31 December 2020 in
respect of divestments and the exit of non-core businesses is as
follows:
2020 2019
Other non-core
Air Handling businesses Total Total
GBPm GBPm GBPm GBPm
----------------------------- ------------- --------------- ------- ------
Cash consideration received
for divestments 189.7 0.7 190.4 12.6
Cash at date of disposal (29.2) (0.2) (29.4) (0.5)
Disposal costs paid (12.9) (0.3) (13.2) (3.7)
Net cash inflow 147.6 0.2 147.8 8.4
------------------------------ ------------- --------------- ------- ------
Included within 'Other non-core businesses' is GBP0.7m received
during the year in relation to contingent consideration on the sale
of the Building Plastics division in 2017.
The losses arising on the agreed sale or closure of non-core
businesses and associated impairment charges, along with their
results for the current and prior periods have been disclosed
within Other items in the Consolidated Income Statement in order to
present the underlying earnings of the Group.
10. Discontinued operations
On 7 October 2019, the Group announced that it had agreed a sale
of the Air Handling business for consideration of EUR222.7m on a
cash free, debt free basis. The sale was approved by shareholders
at a general meeting on 23 December 2019 and completed on 31
January 2020. At 31 December 2019, Air Handling was classified as a
disposal group held for sale and as a discontinued operation as it
represented a major line of business of the Group. With Air
Handling being classified as a discontinued operation, the Air
Handling segment is no longer presented in the segment note.
The results of the Air Handling business for the year are
presented below:
2020 2019
GBPm GBPm
------------------------------------------------------ ------- --------
Revenue 25.4 323.1
Cost of sales (15.0) (202.0)
------------------------------------------------------ ------- --------
Gross profit 10.4 121.1
Other operating expenses (9.3) (101.3)
------------------------------------------------------ ------- --------
Underlying operating profit 1.1 19.8
Other items - (0.7)
------------------------------------------------------ ------- --------
Operating profit 1.1 19.1
Finance income - 0.1
Finance costs (0.1) (1.3)
------------------------------------------------------ ------- --------
Profit before tax from discontinuing operations
before group other items 1.0 17.9
Costs incurred in connection with the agreed
disposal of discontinued operation - (12.2)
Amortisation of acquired intangibles - (1.9)
------------------------------------------------------ ------- --------
Profit before tax from discontinued operations 1.0 3.8
Income tax expense (0.3) (4.2)
Profit/(loss) after tax from discontinued operations 0.7 (0.4)
------------------------------------------------------ ------- --------
Gain on sale of subsidiary after income tax
(see below) 69.0 -
------------------------------------------------------ ------- --------
Profit/(loss) from discontinued operation 69.7 (0.4)
------------------------------------------------------ ------- --------
Amounts included in accumulated OCI are as follows:
-------------------------------------------------------
2020 2019
GBPm GBPm
------------------------------------------------------- ------ -------
Remeasurement of defined benefit pension liability - (0.5)
Deferred tax movement associated with remeasurement
of defined benefit pension liability - 0.1
Reserve of disposal group classified as held
for sale - (0.4)
------------------------------------------------------- ------ -------
The net cash flows incurred by Air Handling are as follows:
------------------------------------------------------------------------
2020 2019
GBPm GBPm
------------------------------------------------------- ------ -------
Operating 1.1 26.5
Investing 147.6 (5.1)
Financing - (9.4)
Net cash inflow 148.7 12.0
------------------------------------------------------- ------ -------
Earnings per share:
------------------------------------------------------------------------
2020 2019
------------------------------------------------------- ------ -------
Basic earnings/(loss) per share from discontinued
operations 8.0p (0.0)p
Diluted earnings/(loss) per share from discontinued
operations 8.0p (0.1)p
------------------------------------------------------- ------ -------
Gain on sale
2020
GBPm
------------------------------------------------------------ --------
Consideration received(1) :
Cash 191.9
Adjustment to consideration (2.2)
Final consideration 189.7
Carrying amount of net assets sold(2) (118.1)
------------------------------------------------------------- --------
Gain on sale before costs, income tax and reclassification
of foreign currency translation reserve 71.6
Costs incurred in connection with the agreed
disposal of the Air Handling business(3) (4.3)
Reclassification of foreign currency translation
reserve 3.7
Income tax expense on gain (2.0)
------------------------------------------------------------- --------
Gain on sale after income tax 69.0
(1) Consideration received was based on an enterprise value of
EUR222.7m on a cash free, debt free basis, adjusted for actual
levels of cash, debt and working capital in the Air Handling
division at completion to give proceeds received of EUR228.6m
(GBP191.9m). Net proceeds received exclusive of amounts repaid in
relation to debt owed to the Group by the Air Handling division was
EUR187.4m (GBP157.3m). As part of the completion process, further
adjustments to the consideration were agreed and repaid by the
Group, together with settlement of tax payments, reducing total
consideration by GBP2.2m.
(2) The carrying amount of net assets sold is the net assets
held for sale at 31 December 2019 shown below plus GBP0.4m relating
to the net profit for the month of January 2020 less tax payments
and working capital movements.
(3) GBP12.2m of costs were incurred and recognised in 2019 in
connection with the sale. Including these in the overall
calculation of the gain on sale above would give a gain on sale
after income tax of GBP57.0m.
The major classes of assets and liabilities of the Air Handling
business classified as held for sale as at 31 December 2019 were as
follows:
2019
GBPm
---------------------------------------------- -------
Goodwill and intangible assets 33.2
Property, plant and equipment 15.1
Right-of-use assets 31.5
Inventories 33.9
Trade and other receivables 58.9
Contract assets 1.5
Deferred tax asset 1.3
Deferred consideration 0.8
Cash at bank and on hand 28.8
----------------------------------------------- -------
Assets held for sale 205.0
----------------------------------------------- -------
Trade and other payables (46.0)
Contract liabilities (1.5)
Lease liabilities (31.9)
Deferred tax liability (1.0)
Corporation tax liability (1.2)
Retirement benefit obligations (3.4)
Provisions (1.5)
----------------------------------------------- -------
Liabilities directly associated with assets
held for sale (86.5)
----------------------------------------------- -------
Net assets directly associated with disposal
group 118.5
11. Related party transactions
Transactions between the Company and its subsidiaries, which
are related parties, have been eliminated on consolidation and
have therefore not been disclosed.
In 2020, SIG incurred expenses of GBP0.5m (2019: GBP0.4m) on
behalf of the SIG plc Retirement Benefits Plan, the UK defined
benefit pension scheme.
Remuneration of key management personnel
The total remuneration of key management personnel of the Group,
being the Group Executive Committee members and the Non-Executive
Directors, is set out below in aggregate for each of the categories
specified in IAS 24 "Related Party Disclosures".
---------------------------------------------------------------------------
2020 2019
GBPm GBPm
---------------------------------------------------------- ------- ------
Short term employee benefits 5.8 4.3
Termination and post-employment benefits 0.1 0.4
IFRS 2 share option charge - 0.1
5.9 4.8
---------------------------------------------------------- ------- ------
12. Non-statutory information
The Group uses a variety of alternative performance measures,
which are non-IFRS, to describe the Group's performance. The Group
considers these performance measures to provide useful historical
financial information to help investors evaluate the underlying
performance of the business.
These measures, as shown below, are used to improve the
comparability of information between reporting periods and
geographical units, to adjust for Other items (as explained in
further detail within the Statement of Significant Accounting
Policies) or to adjust for businesses identified as non-core to
provide information on the ongoing activities of the Group. This
also reflects how the business is managed and measured on a
day-to-day basis. Non-core businesses are those businesses that
have been closed or disposed of or where the Board has resolved to
close or dispose of the businesses by 31 December 2020.
a) Net debt
Net debt is a key metric for the Group, and monitoring it is an
important element of treasury risk management for the Group. In
addition, maximum net debt is one of the primary covenants
applicable to the Group's debt facilities. For the purpose of
covenant calculations, net debt is stated before the impact of IFRS
16. The different net debt definitions used are as follows:
2020 2019
GBPm GBPm
-------------------------------------------- -------- --------
Reported net debt 238.2 455.4
Lease liabilities recognised in accordance
with IFRS 16 (237.0) (296.0)
Lease receivables recognised in accordance
with IFRS 16 4.3 5.2
Other financial liabilities recognised
in accordance with IFRS 16 (1.4) (1.8)
--------------------------------------------- -------- --------
Net debt excluding the impact of IFRS 16 4.1 162.8
Loss on debt modification recognised in
accordance with IFRS 9 (10.1) -
-------------------------------------------- -------- --------
Net debt on frozen GAAP basis (6.0) 162.8
--------------------------------------------- -------- --------
Other covenant financial indebtedness 5.1 5.4
Foreign exchange adjustment* (0.5) 0.3
Covenant net debt (1.4) 168.5
--------------------------------------------- -------- --------
* For the purpose of covenant calculations, net debt is
calculated using net debt translated at average rather than period
end rates.
b) Like-for-like sales
Like-for-like sales is calculated on a constant currency basis
and represents the growth in the Group's sales per day excluding
any acquisitions or disposals completed or agreed in the current
and prior year. Revenue is not adjusted for branch openings and
closures. This measure shows how the Group has developed its
revenue for comparable business relative to the prior period. As
such it is a key measure of the growth of the Group during the
year.
Total
France France Germany
UK UK Total Distribution Exteriors Total and Total
Distribution Exteriors UK (LiTT) (Larivière) France Germany Benelux Benelux Ireland Poland Group
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
-------------- ------------- ----------- -------- ------------- ------------------ -------- -------- -------- -------- -------- ------- -------
Statutory
revenue
2020 357.4 310.1 667.5 168.1 346.6 514.7 370.7 91.6 462.3 80.5 149.5 1,874.5
Non-core
businesses - - - - (1.8) (1.8) - - - - - (1.8)
Underlying
revenue 2020 357.4 310.1 667.5 168.1 344.8 512.9 370.7 91.6 462.3 80.5 149.5 1,872.7
------------- ------------- --------
Statutory
revenue
2019 535.5 346.5 882.0 184.5 344.1 528.6 396.0 103.0 499.0 94.9 156.1 2,160.6
Non-core
businesses (1.2) - (1.2) - (1.9) (1.9) (14.5) - (14.5) - - (17.6)
Underlying
revenue 2019 534.3 346.5 880.8 184.5 342.2 526.7 381.5 103.0 484.5 94.9 156.1 2,143.0
------------- ------------- --------
% change year
on year:
Underlying
revenue (33.1)% (10.5)% (24.2)% (8.9)% 0.8% (2.6)% (2.8)% (11.1)% (4.6)% (15.2)% (4.2)% (12.6)%
Impact of
currency - - - (1.4)% (1.6)% (1.6)% (1.6)% (1.4)% (1.5)% (1.3)% 2.3% (0.6)%
Impact of
acquisitions - (0.3)% (0.1)% - - - - - - - - -
Impact of
working
days (0.3)% (0.4)% (0.3)% - 1.2% 0.7% (0.8)% (0.4)% (0.7)% (0.3)% (0.8)% (0.1)%
Like-for-like
sales (33.4)% (11.2)% (24.6)% (10.3)% 0.4% (3.4)% (5.1)% (12.8)% (6.8)% (16.8)% (2.7)% (13.3)%
------------- ------------- --------
c) Gross margin
Gross margin is the ratio of gross profit to revenue and is used
to understand the value the Group creates from its trading
activities.
Total
France France Germany
UK UK Total Distribution Exteriors Total and Total
Distribution Exteriors UK (LiTT) (Larivière) France Germany Benelux Benelux Ireland Poland Group
% % % % % % % % % % % %
----------- ------- ------------- ------------------ -------- -------- -------- -------- -------- ------- ------
Statutory
gross
margin
2020 22.5% 27.3% 24.7% 27.4% 24.3% 25.3% 28.0% 24.6% 27.3% 23.4% 20.0% 25.1%
Impact of
non-core
businesses - - - - - - - - - - - -
----------- ------- ------------- ------------------ -------- -------- -------- -------- -------- ------- ------
Underlying
gross
margin
2020 22.5% 27.3% 24.7% 27.4% 24.3% 25.3% 28.0% 24.6% 27.3% 23.4% 20.0% 25.1%
----------- ------- ------------- ------------------ -------- -------- -------- -------- -------- ------- ------
Statutory
gross
margin
2019 26.1% 28.3% 27.0% 27.4% 23.3% 24.8% 27.6% 24.7% 27.0% 25.0% 20.3% 25.9%
Impact of
non-core
businesses 0.1% - 0.1% - 0.1% - 0.1% - - - - -
----------- ------- ------------- ------------------ -------- -------- -------- -------- -------- ------- ------
Underlying
gross
margin
2019 26.2% 28.3% 27.1% 27.4% 23.4% 24.8% 27.7% 24.7% 27.0% 25.0% 20.3% 25.9%
----------- ------- ------------- ------------------ -------- -------- -------- -------- -------- ------- ------
a)
d) Operating cost as a percentage of sales
This is a measure of how effectively the Group's operating cost
base is being used to generate revenue.
Six months Six months
Six months ended 31 Year ended Six months ended 31 Year ended
ended 30 December 31 December ended 30 December 31 December
June 2020 2020 2020 June 2019 2019 2019
GBPm GBPm GBPm GBPm GBPm GBPm
Statutory revenue 840.1 1,034.4 1,874.5 1,113.3 1,047.3 2,160.6
Non-core businesses (1.2) (0.6) (1.8) (13.4) (4.2) (17.6)
Underlying revenue 838.9 1,033.8 1,872.7 1,099.9 1,043.1 2,143.0
------------------------------------------
Operating costs (statutory) 312.4 325.8 638.2 267.9 379.1 647.0
Other items (60.4) (54.5) (114.9) (19.5) (114.6) (134.1)
Underlying operating costs 252.0 271.3 523.3 248.4 264.5 512.9
Operating costs as a percentage of
statutory revenue 37.2% 31.5% 34.0% 24.1% 36.2% 29.9%
Underlying operating costs as a percentage
of underlying revenue 30.0% 26.1% 27.9% 22.6% 25.4% 23.9%
e) Operating margin
This is used to enhance understanding and comparability of the
underlying financial performance of the Group by period and
segment, excluding the benefit of property profits which can have a
significant effect on results in a particular period.
Total
France France Germany Parent
UK UK Total Distribution Exteriors Total and company Total
Distribution Exteriors UK (LiTT) (Larivière) France Germany Benelux Benelux Ireland Poland costs Group
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
------------- -------- -------- -------- ------- -------
2020
Underlying
revenue 357.4 310.1 667.5 168.1 344.8 512.9 370.7 91.6 462.3 80.5 149.5 - 1,872.7
Underlying
operating
profit (45.4) (7.4) (52.8) 7.1 8.3 15.4 0.4 2.5 2.9 0.8 2.0 (21.6) (53.3)
Operating
margin (12.7)% (2.4)% (7.9)% 4.2% 2.4% 3.0% 0.1% 2.7% 0.6% 1.0% 1.3% n/a (2.8)%
2019
Underlying revenue 534.3 346.5 880.8 184.5 342.2 526.7 381.5 103.0 484.5 94.9 156.1 - 2,143.0
Underlying operating
profit 7.9 11.8 19.7 11.2 8.6 19.8 4.4 5.2 9.6 6.8 4.3 (17.7) 42.5
Operating margin 1.5% 3.4% 2.2% 6.1% 2.5% 3.8% 1.2% 5.0% 2.0% 7.2% 2.8% n/a 2.0%
f) Other non-statutory measures
In addition to the alternative performance measures noted above,
the Group also uses underlying EPS and underlying net finance
costs.
13. Principal risks and uncertainties
The Board sets the strategy for the Group and ensures the risks
for the delivery of this strategy are effectively identified and
managed through the implementation of the risk management
framework.
The Group employs a three lines of defence model to provide a
simple and effective way to enhance the risk management process and
ensure roles and responsibilities are clear. The Board maintains
oversight to ensure risk management and control activities carried
out by the three lines are proportionate to the perceived degree of
risk and its own risk appetite across the Group.
The SIG risk management framework is based on the identification
of Group risks through regular discussion at local operating
company leadership, and Executive Leadership Team meetings. New and
emerging risks are identified through the use of horizon scanning,
regular exercises with first and second line teams and attendance
at relevant forums. These risks are monitored on an ongoing basis
with thorough risk assessments completed where needed, to ensure
that the Group is well positioned to manage these risks should they
crystallise.
Throughout the year the risks that SIG faces have been
critically reviewed and evaluated. The assessment of the most
significant risks and uncertainties that could impact SIG's
long-term performance are outlined below. These risks are not set
out in order of priority and they do not comprise all the risks and
the uncertainties that SIG faces. This list has the potential to
change as some risks assume greater importance than others during
the course of the year.
Risk Mitigations
Employee attraction, retention and engagement
Failure to attract and retain people with the right * Engagement survey completed with associated action
skills, drive and capability to reshape plan developed.
and grow the business.
* Improved remuneration packages and retention plans
for critical roles.
* Launch of commitment culture.
* Launch of mental health and wellbeing policy.
* Monthly tracking of staff turnover and key
indicators.
Health and safety
Danger of incident or accident, resulting in injury or * Integrated Safety management system being
loss of life to employees, customers implemented.
or the general public.
* Framework of compliance standards in place.
* Regular monitoring and reporting of key metrics.
* HSE managers visibility raised by joining Group
Senior Leadership Team.
Delivering business change
Failure to deliver the change and growth agenda in an * Project Delivery Framework in place for IT enabled
effective manner, resulting in management projects.
stretch, compromised quality and inability to meet growth
targets.
* Governance process in place for delivery of major
projects.
* Benefits tracking.
* Monitoring of KPIs relating to key business change
programmes.
Cyber security
Internal or external cyber attack could result in system * Training and communication schedule to ensure
disruption of loss of sensitive data. employee awareness of risks.
* Disaster recovery plans in place and secure backups
conducted to ensure continuity of service.
* Endpoint encryption installation.
* Enhanced cyber attack monitoring.
* Monthly tracking of key indicators in management
accounts.
Data quality and governance
Poor data quality negatively impacts our financial * Regulatory policies in place to govern compliance.
management, fact-based decision making,
business efficiency, and credibility with customers.
* Delivery of training and awareness campaigns.
* IT upgrade projects in key locations.
Market downturn
Volatility in the market impact the Group's ability to * The Group's geographical diversity across Europe
accurately forecast and to meet internal reduces the impact of changes in market conditions in
and external expectations. any one country.
* Industry based KPIs monitored monthly at a Group and
operating company level.
* Regular and ongoing business performance reviews are
conducted.
* Brexit monitoring.
* Enhanced forecasting with Group visibility.
* Business growth plans in place.
Systems failure
Systems become heavily customised and outdated and are * Support from specialised third-party experts.
unable to support critical business
activity and decision making.
* Business continuity and disaster recovery
capabilities.
* IT upgrade projects in key locations.
Business growth
SIG is unable to grow sales and/or land new market * Growth targets included in budgets for all business
opportunities to grow market share in line areas.
with strategy.
* Business performance is reported and monitored
regularly in management accounts and at management
meetings.
* Bespoke technical offerings and diverse specialist
product ranges give access to specialist markets.
Delivering the customer experience
Failure to deliver consistent, high-quality service to * Customer-centric training and development programmes.
customers and/or strengthen relationships
with customers.
* Customer segmentation analysis.
* Development of loyalty programmes.
* Customer metrics reported and monitored regularly in
management accounts and at management meetings.
* Customer satisfaction and Net Promoter Score surveys.
Environmental, social and governance
SIG suffers financial and/or reputational losses as a * ESG roadmap in development for rollout prior to
result of poor environmental, social upcoming disclosure obligation deadlines.
and governance performance and/or disclosure.
* Employee mental health and wellbeing programme.
* Development of a ten-year de-carbonisation plan.
* ISO14001 Environmental Management Systems
accreditation rollout plan.
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 FZLLLFXLZBBB
(END) Dow Jones Newswires
March 25, 2021 03:00 ET (07:00 GMT)
Sig (LSE:SHI)
Historical Stock Chart
From Jun 2024 to Jul 2024
Sig (LSE:SHI)
Historical Stock Chart
From Jul 2023 to Jul 2024
