TIDMWYG
RNS Number : 3612A
WYG Plc
07 June 2016
7 June 2016
WYG plc ("WYG" or the "Group")
Final Results
Strong UK performance, record order book and growth momentum in
all regions
WYG plc, the global project management and technical
consultancy, announces its audited final results for the year ended
31 March 2016, highlights of which are as follows:
Financial overview:
-- Revenue* up 2% to GBP133.5m (2015: GBP130.5m)
o Second half revenues of GBP70.9m were up 5% on H2 2015
(GBP67.3m)
-- Adjusted operating profit** up 24% to GBP7.2m (2015: GBP5.8m)
o Adjusted operating margins improved from 4.4% to 5.4% year on
year
-- Adjusted profit before tax** up 23% to GBP7.0m (2015: GBP5.7m)
o Second half adjusted profit before tax** up 29% to GBP4.9m (H2
2015: GBP3.8m)
-- Profit before tax up 54% to GBP2.2m (2015: GBP1.4m)
-- Adjusted earnings per share** up 9% to 10.0p (2015: 9.2p)
-- Earnings per share 4.0p (2015: 2.9p)
-- Total cash net of debt as at 31 March 2016 GBP0.2m (31 March
2015: GBP12.3m) after GBP7.9m investment in
acquisitions
-- Proposed final dividend of 1.0p (2015: 0.7p) giving a total
dividend for the year of 1.5p (2015: 1.0p)
-- Eliminated remaining defined benefit pension risk by
transferring WYD Pension Scheme to Just Retirement Limited with
anticipated return of surplus to WYG
* Including revenue from Joint Ventures
** Before separately disclosed items
Operational overview:
-- 15% increase in UK revenue to GBP96.3m (2015: GBP83.9m)
driven by strong demand for WYG's services across buoyant planning
and infrastructure markets, supplemented by acquisitions
-- Strong second half performance in our international businesses:
o 20% increase in Europe, Africa & Asia (EAA) revenues to
GBP13.0m (H1 2016: GBP10.9m)
o 40% increase in Middle East & North Africa (MENA) revenues
to GBP7.7m (H1 2016: GBP5.5m)
-- Strong progress following completion of the strategic review in June 2015:
o New GBP25m five year committed facility with HSBC
o Acquisitions of FMW Consultancy Limited, North Associates (Cumbria) Limited and Signet Planning
Limited creating a top 3 UK planning consultancy
o Appointed Jeremy Beeton and Neil Masom as non-executive directors and expanded the senior
management team
o New management incentives approved at the AGM - 12.2m options under the TIP surrendered,
equivalent to 17.9% of the issued share capital
-- Order book up 43% to GBP150.1m at 31 March 2016 (31 March
2015: GBP105.0m) prior to post year end wins
o UK order book up 50.0% to GBP79.5m (31 March 2015: GBP53.0m)
reflecting buoyant infrastructure and planning markets
o International order book up 35.8% to GBP70.6m (31 March 2015:
GBP52.0m) demonstrating significant new work now being contracted
following EU budget hiatus
-- Appointment of Iain Clarkson as Chief Financial Officer
Current Trading & Outlook:
-- Trading since the year end is in line with the Board's expectations
-- Strong trading performance of UK Region continuing into Q1 2017
-- EUR80m of specific opportunities in pre-accession countries
with a further EUR100m pipeline of potential opportunities
-- Growing pipeline of international development opportunities
with more than GBP150m specific opportunities and a longer-term
pipeline of GBP350m major projects and frameworks across Africa
supported by committed UK and European budgets
-- MENA Region now mobilising on major projects won in 2015/6
with continuing high levels of bidding activity to support future
activity in this region
-- Launched The Migration Partners, the first private sector
consortium formed to address the migration crisis
-- Order book for work to be undertaken in the current financial
year is GBP97.0m (2015: GBP69.2m) providing a sound basis for
expectations of revenue growth
-- The Board believes WYG's business will not be unduly affected by the UK EU Referendum
Paul Hamer, Chief Executive Officer of WYG plc, commented:
"I am pleased to report on another successful year for WYG in
which we have seen continued strong profit growth and a very
significant increase in our order book despite the first half of
the year being held back by the EU budget hiatus. Having had a very
strong finish to the year, we are seeing buoyant conditions across
all three of our regions driving continued strong momentum into the
new financial year.
"With all regions also showing very substantial order book
growth, WYG's total order book at the year end was GBP150m, an
all-time high for the Group. This gives us excellent forward
visibility underpinning our confidence that the Group can deliver
the further significant growth forecast for the current year."
WYG plc Tel: 0113 278 7111
Paul Hamer, Chief Executive
Officer
Sean Cummins, Group Finance
Director
MHP Communications Tel: 020 3128 8100
John Olsen / Katie Hunt
/ Ollie Hoare
N+1 Singer (Nomad and Tel: 020 7496 3000
Broker)
Sandy Fraser / Nick Owen
WH Ireland Limited (Joint Tel: 020 7220 1666
Broker)
Adrian Hadden / Liam
Gribben
Chairman's statement
Introduction
I am delighted to report further positive developments in the
long term prospects of the Group. This year we have delivered a 23%
increase in adjusted profit before taxation despite a modest 2%
increase in revenue which, as explained in our Half Year Report in
December 2015, was held back in the first half of the year by the
delayed ramp up of the EU funding cycle.
We saw a significant acceleration in both profits and revenue in
the second half of the year as we were able to take advantage of a
strong UK market, supplemented by acquisitions to strengthen our
front end services offering, more than offsetting the initial
delays in our international business. With record order coverage
now in place, all three reporting segments (UK, EAA and MENA) have
strong forward momentum which we expect to continue through the
current year.
We have also made demonstrable progress towards delivering our
strategy of accelerating future growth through our focus on driving
quality revenues from our front-end planning consultancy and
international development businesses, WYG's core areas of strength.
Since we announced the conclusion of our strategic review in June
2015, we have secured new, substantially increased committed
funding, broadened the skills and experience of our Board and put
in place, with shareholder approval, a new suite of management
incentives which will enhance our ability to deliver on our
strategy. We now have greater operational flexibility and have made
selective acquisitions to provide access to a wider range of skills
and resources, framework agreements and geographical coverage.
Predicated on the significant growth in our order book, we
anticipate a period of strong organic growth.
Results
Revenue (including our share of Joint Venture revenues) for the
full year was up 2% to GBP133.5m (2015: GBP130.5m). However,
revenue in the second half was up 13% to GBP70.9m compared with the
first half of the year (GBP62.6m) and up 5% on the second half of
2015 (GBP67.3m). More pleasingly, revenue was also up 12% in the
final quarter of the year compared with the corresponding prior
period, providing excellent momentum into the current year.
Adjusted operating profit increased by 24% to GBP7.2m (2015:
GBP5.8m) representing an adjusted operating margin of 5.4% compared
with 4.4% in the prior year. Adjusted profit before tax was up 23%
to GBP7.0m (2015: GBP5.7m), reflecting a very strong improvement in
profitability year on year. On a statutory basis, the Group made a
profit before tax of GBP2.2m (2015: GBP1.4m). Earnings per share
adjusted for separately disclosed items were 10.0p (2015: 9.2p). On
a statutory basis, earnings per share were 4.0p (2015: 2.9p).
As at 31 March 2016, the Group's order book stood at GBP150.1m
(2015: GBP105.0m), 43% higher than at the same point last year
which, supported by a strengthening pipeline of opportunities in
all our markets, underpins the significant growth we anticipate in
2016/7. All three regions have reported an improving trend with the
UK up 50% on the position in March 2015 and Turkey's order book
almost three times higher. This excellent performance is expected
to progress further during the course of this year.
The Group closed the period with total cash net of debt at 31
March 2016 of GBP0.2m (31 March 2015: GBP12.3m) after investing
GBP7.9m in acquisitions, including the deferred consideration
payment for Alliance Planning. The year end cash balance was also
impacted by the sharp increase in revenue in the final quarter and
our increased focus on higher margin UK planning-related
disciplines (where the working capital cycle is slightly longer)
together with capital investment in upgrades to our offices and
IT.
Bank Facility
In July 2015, we secured a new GBP25 million five-year committed
multicurrency revolving credit facility from HSBC offering broad
flexibility between debt and bonding requirements. This facility,
which gives the Group access to debt for the first time since 2010,
ensures that we have the resources with which to fund our
accelerated growth ambitions.
Acquisitions
During the year we made three acquisitions. These have
reinforced the Group's position as a top three UK planning
consultancy and enhanced our front end consultancy offering while
supporting our focus on high quality revenues.
We acquired FMW Consultancy Limited, a specialist transport and
infrastructure consultancy on 8 June 2015, in a transaction with an
enterprise value of GBP1.4 million, which further improved our
status as one of the largest transport and infrastructure planning
consultancies in the UK. The acquisition was immediately earnings
enhancing and, having been completely integrated into our business,
is performing well as part of the Group.
We announced the acquisition of North Associates (Cumbria)
Limited together with its subsidiary, Taylor & Hardy Limited,
on 30 October 2015 for a maximum total consideration of GBP5.0
million. This acquisition not only bolstered the Group's status as
one of the largest property asset management and planning
consultancy businesses in the UK, it also positioned WYG to benefit
from some of the anticipated GBP90 billion of investment planned as
part of the development of Britain's Energy Coast in West Cumbria.
This team, which is mainly based in Carlisle, has been working
closely with our existing Cumbria office to develop an exciting
pipeline of opportunities in this region.
On 5 January 2016, we acquired the entire issued share capital
of SCA Planning Limited, which trades as Signet Planning, for a
maximum enterprise value of GBP3.7 million. Signet Planning is a
fast growing town planning and urban design consultancy with a
c.40-strong team and is well positioned to achieve further growth,
especially in the London commercial development market, the
residential sector generally and through opportunities driven by
the UK government's Northern Powerhouse agenda.
We now have more than 135 planning specialists constituting the
third largest team in the UK. This leading market position places
us well to take advantage of the strong demand we expect for these
specialist skills within a buoyant UK market for property and
infrastructure development.
New Management Incentives
At the AGM in September 2015, shareholders approved new
incentive arrangements which comprised three key elements: an
annual bonus scheme with deferred cash and share-based payments, a
more standard long term incentive plan (LTIP) with stretching three
year EPS and TSR targets, and a retention scheme for other key
senior employees. The Company has granted options over 1.4 million
ordinary shares under the LTIP and 1.1 million ordinary shares
under the retention scheme.
The new schemes replaced the existing Transformation Incentive
Plan (TIP) and required 12.2 million options previously awarded
under the TIP to be surrendered. The surrender was equivalent to
17.9% of the issued share capital and thus substantially removed
the potential dilutive effect of the TIP scheme which had become an
impediment to optimising shareholder value. Following the surrender
of awards under the TIP (and the lapse of other awards) there are
4.1 million vested and unvested TIP options over ordinary
shares.
There are no other options over the Company's ordinary
shares.
Pensions
In December 2015, the Trustees of the WYD Pension Scheme reached
an agreement to insure the liabilities of the scheme with Just
Retirement Limited. The agreement contained an option allowing the
Trustees to effect a buy-out of all the WYD Pension Scheme
liabilities and on 31 March 2016 they completed the exercise of
this option. This eliminated the Group's only remaining exposure to
defined benefit pension risk. The process of winding up the WYD
Pension Scheme has now commenced.
Dividend
In March 2016 we paid an interim dividend of 0.5p. Subject to
the approval of shareholders at the AGM, a dividend of 1.0p will be
paid on 28 September 2016 to ordinary shareholders on the register
on 2 September 2016, bringing the overall dividend for the year to
1.5p per ordinary share (2015: 1.0p).
The Financial Results are discussed in more detail in the
Strategic Report and set out in full in the Financial
Statements.
Board changes
Following the strategic review, the Board stated it would take
the opportunity to extend the talents, skill sets and connections
the Company needs to be more closely aligned to its markets and to
ensure it has a board structure to deliver the next phase of
growth.
As a result, on 1 October 2015, we announced the appointment of
two new non-executive directors. Jeremy Beeton joined us as the
senior independent non-executive director with more than 40 years'
experience in international business, government, construction and
civil engineering. Neil Masom joined us to chair WYG's Remuneration
Committee with more than 30 years' experience of working in
complex, politically sensitive activities in international,
commercial and public sector organisations.
Graham Olver, the Group's Chief Operating Officer, decided to
step down from the Board in August 2015. In September, Robert Barr,
the Group's senior independent non-executive director retired from
the Board having completed the maximum nine years' service on the
Board during which he could be deemed to be independent under the
UK Corporate Governance Code.
Since then, we announced in December 2015 that after four very
challenging yet successful years, Sean Cummins had decided for
personal reasons to step down as Group Finance Director. During his
time with the Group, Sean has played a key role in WYG's transition
to a well funded, independent group and he will leave WYG in a
strong position to execute the growth strategy which is at the
heart of the next phase of its development.
The Board wishes to take this opportunity to thank Graham,
Robert and Sean for their contributions to the transformation of
WYG and wish them every success for the future.
We are pleased to announce the appointment today of Iain
Clarkson as Chief Financial Officer. Iain joins us from AMEC Foster
Wheeler plc where, from 2012 to 2016, he was Finance Director of
their Clean Energy Europe Business, a GBP200 million division with
operations in the UK, Central and Eastern Europe and South Africa,
employing around 2,200 staff. Iain was previously Finance Director
of AMEC plc's nuclear business and its Power & Process Europe
divisions. From 2001 to 2007, Iain was Vice President Finance of
Westinghouse Electric Company's European nuclear fuel business and
then its global nuclear fuel business, where he supported growing
the company to become the world's largest nuclear fuel operation
with sales of approximately $1bn. Iain, who has a BSC in
mathematics, qualified as a chartered accountant (ACA) in 1992. He
trained with and worked for Coopers & Lybrand until 1996 when
he joined BNFL, first as Head of Finance, New Business Ventures and
subsequently as Corporate Finance Manager and then Head of Finance
on BNFL's privatisation project.
The UK's EU Referendum
The European Union (in the form of EuropeAid) is the Group's
single largest client. As a Board, we have carefully considered the
implications of the forthcoming UK referendum on the question of
membership of the European Union (EU), or 'Brexit'. We have formed
the view that, should there be a vote to leave the EU, it will have
no medium term effect on our international business and a very
limited effect on the Group as a whole.
As regards our particular market exposure with EuropeAid, our
unique 'localisation strategy' developed over the past 12 years of
creating local businesses and legal entities in our key markets
positions us strongly to maintain all of our existing business and
to continue to bid and win future opportunities.
Although much would depend on the type of economic and political
relationship that the UK entered into post Brexit, we believe that
we would continue to satisfy the eligibility criteria applicable to
international public sector procurement frameworks.
We currently bid for the majority of our European work through
our well-established Polish, Turkish and Croatian subsidiaries. We
believe these will not be affected by Brexit. A relatively small
proportion of our contracts are made solely through a UK entity. We
do not expect there to be any impact on current contracts and we
anticipate that if the UK enters into negotiations to leave the EU,
there will be sufficient time for us to realign and reposition
ourselves, if necessary, in such a way as to direct all of this
business through our localised international subsidiaries so as to
maintain our market leading position.
The Board has therefore concluded that, other than as a result
of the impact of any wider market uncertainty on all UK businesses,
WYG's own business will not be unduly affected by a vote to
leave.
Current trading and outlook
In the UK we have again seen strong revenue growth and
significant increases in our profitability and order book.
Several major new infrastructure spending programmes have been
announced and work on these and other long term projects will fuel
our core front end planning and consultancy businesses. We have
continued improving our bid to win ratio on long term framework
agreements. This has led to an increase in the volume of work on
major contracts with core clients, including the UK MoD's Defence
Infrastructure Organisation. We believe that our UK business is
well positioned to continue its strong growth trajectory.
Although the delay to the new EU funding cycle held back near
term growth and profitability in our international regions,
particularly in the first half, the EU budget is now being deployed
at an accelerated rate making us extremely confident that the short
and medium term prospects will show an ongoing and meaningful
improvement. Our international business is beginning to mobilise on
some of the major, multi-year projects we secured in the second
half of last year and, with a very high proportion of the current
financial year's projected work already contracted, we anticipate
that our teams in EAA and MENA will see a significant increase in
revenue over the coming period.
We have made good progress diversifying into fragile and
developing states where we mitigate commercial risk by having a
broad portfolio of projects, particularly in Central Africa. In
this region we expect to deliver further growth and improved
financial performance based on our success in winning work funded
by the substantial, committed budgets of the UK's Department for
International Development (DfID), EuropeAid and other international
funding institutions.
Our overall order book for work to be undertaken in the current
financial year is GBP97.0m compared with GBP69.2m at the
corresponding point last year, providing a sound basis for our
expectations of revenue growth in the current year.
The excellent results set out in this report reflect the effort,
professionalism and dedication of our employees, including almost
300 new staff who have joined the WYG family in the past 12 months,
and on behalf of the Board I would like to thank them all for their
hard work and contribution.
Business performance review
Our UK business performed extremely well, showing double digit
growth in revenue and profitability for the second year in
succession with underlying organic revenue growth of more than 10%.
The region has also been successful in generating new orders, which
underpin expectations for the current financial year and provide a
good base for the next year. Competition for talented staff has
been intense and shows no sign of letting up. We have therefore
made a considerable investment in our resourcing team and the
platforms they use to attract skilled employees.
As we have reported on a number of occasions, the slower than
anticipated ramp up of the new EU funding cycle impacted our EAA
Region in particular during the first half of the year. However, in
the second half, we saw a 20% increase in revenue and a good finish
to the year with the announcement of the EUR5.8m Labour Office
training programme in Katowice. We are now focussed on winning a
proportion of the pipeline of opportunities in the Western Balkans
including the next phase of the IPF (Infrastructure Projects
Facility).
Our Africa and Rest of World sub-region performed especially
well in the final quarter as it closed out a number of major
programmes and started work on many of the new projects they have
won with DfID, EuropeAid, World Bank and other international
finance institutions in the past 12 months.
In our Middle East North Africa (MENA) Region, Turkey delivered
revenues which were again lower overall than in the previous
financial year. This result masks the fact that in the second half
revenue was more than 50% up on the first half, and the order book
grew to a level that now means more than 90% of budgeted work for
this financial year was secured before 1 April.
Operational review
Operationally, the Group was structured and reported throughout
the financial year on a regional basis with the three regions
being:
-- UK
-- Europe (which includes CIS and Western Balkans), Africa & Asia (EAA)
-- MENA (Middle East & North Africa including Turkey)
UK (72.2% of Group revenue) - strong growth in revenue, profits
and order book
The UK region generated a 15% increase in revenue of GBP96.3m
(2015: GBP83.9m) with an operating profit before separately
disclosed items of GBP10.3m (2015: GBP7.7m).
The continued growth in our UK region has been achieved with
strong organic performance, supplemented by further strategic
acquisitions, strengthening still further our 'front-end' services.
With the acquisition of Signet Planning in January, WYG is now one
of the three largest planning consultancies in the UK, employing
approximately 135 town planners. We continue to perform strongly in
the environmental sector, supporting National Grid, the Homes &
Communities Agency (HCA), Defence Infrastructure Organisation (DIO)
and a number of national house builders.
We continue to support the HCA on numerous site disposals and
housing delivery projects. Our urban designers have provided
strategic advice to councils in Oxfordshire and South
Northamptonshire on major urban expansions. We were reappointed as
one of only two planning consultancies nationally, supporting
Sainsbury's. We were successful in securing a number of major
education schemes including Strule, which is a GBP100m plus scheme
consolidating five existing school campuses in Omagh, Northern
Ireland.
We are designing a range of highly specialist laboratories in
Wiltshire and are working on the design of the new headquarters for
the Square Kilometre Array (SKA) at Jodrell Bank in Cheshire, which
will link radio telescopes from South Africa and Western Australia.
As one of the largest scientific endeavours being undertaken in the
world today, the SKA will bring together a wealth of the world's
finest scientists, engineers and policy makers to bring the project
to fruition.
Our Management Services team is leading a group of experts drawn
from across WYG's disciplines to oversee the refurbishment of City
of London Police's flagship Wood Street headquarters. Our transport
team have been delivering 'intelligent transport' systems for local
authorities and transport and infrastructure solutions for our
clients and our transport services capability in the South West has
been strengthened by our acquisition of FMW.
The Asset Management discipline has continued to grow this year,
adding new services with the acquisition of North Associates, which
provides niche strategic asset management services. We have been
appointed as technical compliance consultant to the Co-operative
Group Limited and have been successful in renewing the Civil
Inspection and Topographical Surveying Framework with Sellafield
Ltd.
Work to support the DIO has continued and we are working on
numerous construction and asset management schemes across the
globe. We also assisted the disaster recovery efforts in Nepal on a
pro-bono basis, providing project management support to the charity
Community Action Nepal immediately after the devastating
earthquake. Our lead project manager, Glyn Utting subsequently won
a British Expertise award for the support provided.
The outlook for the UK business is very positive indeed with our
order book up by 50.0% to GBP79.5m (31 March 2015: GBP53.0m)
reflecting buoyant infrastructure and planning markets. As we
approach the end of the first quarter of the new financial year it
is apparent that the acceleration we saw towards the end of the
previous period has continued and we are confident that we will
enjoy another year of growing revenue and profitability.
Europe, Africa & Asia (17.9% of Group revenue) - impact of
delays from EU budget in the first half started to reverse in the
second half; strong growth in Africa with DfID
In this region WYG operates through four sub-regional business
units - Central and Eastern Europe (CEE), South East Europe (SEE),
Africa, and Asia. In the year the EAA region generated revenue of
GBP23.9m (2015: GBP30.4m), with an operating profit before
separately disclosed items of GBP0.7m (2015: GBP1.6m).
The year was characterised by our very strong business
development performance in Africa, and the delayed onset of
projects in markets with a strong link to the EU funding cycle.
In the CEE business unit, Bulgaria was successful in winning a
portfolio of transport and other projects. Throughout the CEE
business, delays in the release of EU funding impacted the uptake
of work. However, towards the close of the year, significant
European Structural Funds projects and other opportunities began to
emerge. In Poland this delay in funding resulted in a backlog of
almost EUR40 million of opportunities awaiting final decisions in
the forthcoming year.
The strongest performer during the year was our SEE business
unit which delivered a diversified portfolio of socio-economic and
infrastructure projects throughout the region. In addition we
continued our successful implementation of the Infrastructure
Projects Facility (IPF) in the Western Balkans - a programme with
which we have been involved since 2008.
In Africa and Asia, we secured EUR43m worth of new contract
wins, a 66% increase on the prior year, maximising the market
development work undertaken in the previous year. Important new
projects saw us expanding into areas such the sustainable
agriculture sector in Sub-Saharan Africa, support of non-state
organisations in Zanzibar, as well as further public financial
management and monitoring and evaluation work.
We work in 32 countries in Africa and Asia and are in a unique
position to address international governments' concerns over
uncontrolled mass migration. With that in mind, we have developed a
new business entity, The Migration Partners, bringing together a
pan-European consortium with longstanding, deep understanding of,
and experience in, each of the fields that will be needed to
address this pressing issue. Funding is now being made available
through, for example, the European Development Fund which has been
increased under the MFF 2014-2020 to EUR30.5bn (MFF 2007-2013:
EUR22.7bn), and we believe that we are the first private sector
entity to engage meaningfully with a number of governments and
international institutions to help them address the migration
crisis.
Looking forward, the longer term market outlook is very
positive. We are well positioned to take advantage of the
international development opportunities in Africa and Asia and,
with the EU funding cycle beginning to regain momentum, we are
looking to expand our business development activities significantly
in both SEE and CEE.
MENA (9.9% of Group revenue) - broadly stable in year
performance offset by excellent order book growth and cover for FY
2017
In the MENA region we generated revenue of GBP13.2m (2015:
GBP16.1m) with an operating profit before separately disclosed
items of GBP0.3m (2015: GBP0.5m). The results in the year reflect
the impact of the delay in the release of EU funding within the
region, which has only now begun to be allocated.
WYG MENA generates most of its revenue from socio-economic,
technical and engineering programmes, the majority of which are
funded under the Instrument for Pre-Accession Assistance (IPA) - a
component of the MFF 2014-2020.
With more than 60 permanent staff operating in and from Ankara,
as well as a network of around 200 associates working throughout
the country, we continue to focus on our core strength of
socio-economic consultancy, where we are the market leader in
Turkey.
Illustrating the variety and scope of what we do, some of the
key socio-economic consultancy projects worked on during the year
include projects which:
-- increase the employability of disadvantaged persons
-- provide technical assistance for recruitment of future blood donors
-- increase the number of human tissue donors
-- increase regional competitiveness
-- address enforcement services in prisons
-- assist in preventing corruption and promoting ethics
-- assist on the Garment Training and Entrepreneurship Initiative (GATE for Women)
-- provide advisory services for development of social and environmental investment programmes
-- improve the employability of women and young people
In addition, we have maintained our market leading specialism in
technical services with particular success in the water and waste
water sectors, where we have been awarded a fifth major water
project in the city of Kahramanmara .
Building on our efforts to increase business diversification we
have, in consortium with others, won and started work on our first
major transport project namely, "Turkey's National Transport
Masterplan". We continue to make good progress with our efforts to
identify and pursue eligible opportunities with a range of public
and private sector organisations in relation to the soft
environment (ie the natural environment, air quality, greenhouse
gas emissions, groundwater management, marine strategy etc),
infrastructure and in other sectors to achieve our diversification
goal.
During the year we worked on a number of new business
opportunities with various international development agencies, and
we began to work on private sector and other EU-funded projects in
the Middle East. These efforts started to yield results towards the
end of the financial year and we hope to continue growing in this
area.
Continuing last year's trend, the Region has seen a significant
increase in tendering activity in the current financial year,
resulting in the award of 15 major new projects, winning one in
four of the projects we bid, and bringing the total order book as
at 31 March 2016 to GBP24.3m nearly three times what it was at the
corresponding time last year (31 March 2015: GBP8.3m. With more
than 90% of our budgeted work for 2017 contracted, we approach the
current financial year with a high degree of confidence that the
MENA Region will deliver a strong performance.
Financial review
Revenue (including our share of joint venture revenues) was
GBP133.5m (2015: GBP130.5m), with international revenues accounting
for 27.8% (2015: 35.7%) of Group revenue. However, revenue in the
second half was up 13% to GBP70.9m compared with the first half of
the year (GBP62.6m), and up 5% on the second half of 2015
(GBP67.3m). More pleasingly, revenue was also up 12% in the final
quarter of the financial year compared with the corresponding prior
period, providing excellent momentum into the current year.
Although the proportion of international work has declined for the
second year in succession this is as much to do with the
significant increase in UK revenue as the continuing impact of
delays in implementing the EU programmes financed by the MFF
2014-2020.
Adjusted operating profit increased by 24% to GBP7.2m (2015:
GBP5.8m) and adjusted profit before tax was up 23% to GBP7.0m
(2015: GBP5.7m), reflecting a very strong improvement in
profitability year on year. In the second half of the year we
achieved an operating profit before separately disclosed items of
GBP5.0m (2015: GBP3.7m), more than double the GBP2.2m achieved in
the first half (2015: GBP2.1m). The improvement is driven by a
combination of improving discipline at the project level together
with continued improvements in staff utilisation and control of
overhead costs.
On a statutory basis, the Group made a profit before tax of
GBP2.2m (2015: GBP1.4m). Earnings per share adjusted to exclude
separately disclosed items increased to 10.0p (2015: 9.2p). On a
statutory basis, earnings per share were 4.0p (2015: 2.9p).
The primary component of finance costs is the charges relating
to our bond and banking facilities. We have now completely redeemed
or replaced the legacy bonds we had under the more expensive
2009/2010 facility. Finance costs were slightly up at GBP0.2m
(2015: GBP0.1m) as we have gradually increased our use of less
expensive bonds and started to make use of the GBP25m five year
committed bank facility agreed with HSBC in July 2015. Going
forward, we expect to make increased use of this facility as a
catalyst to fund organic and acquisitive growth.
The Group still has significant losses brought forward in the UK
and is likely to pay a reduced rate of UK tax for the foreseeable
future. We also generate profit in many of our overseas activities,
upon which we pay local corporation tax.
The Group closed the year with total cash net of debt at 31
March 2016 of GBP0.2m (31 March 2015: GBP12.3m) after investing
GBP7.9m in acquisitions. Although we benefitted from a one off
payment arising from a successful professional negligence claim,
other demands on cash have included the planned application of
GBP3.4m towards legacy issues (including ongoing commitments on
unoccupied offices), total dividend payments of GBP0.8m and the
costs associated with the strategic review. Cash spending on legacy
issues continues to reduce ahead of target and going forward we
expect this trend to continue, albeit at a slower rate than in
previous years. The year end cash balance was also impacted by the
sharp increase in revenue in the final quarter and our increased
focus on higher margin UK planning-related disciplines (where the
working capital cycle is slightly longer), the impact of a small
number of global price contracts noted below together with capital
investment in upgrades to our offices and IT.
We place a heavy emphasis on the importance of cash generation
and the effective management of working capital - indeed, cash
conversion is one of the performance targets under the current
bonus schemes for the senior management team. This year we have
changed our working capital KPI to an 'after fees in advance'
basis, for which the measure as at 31 March 2016 was 81 days (2015:
72 days). The increase is due, in part, to the impact of a small
number of large global price EU contracts in respect of which (in
line with the relevant contract) we have received no fees during
the reporting period but which will close in the first half of the
current financial year restoring the working capital position to a
level closer to, or better than, our KPI target of 75 days.
As at 31 March 2016, the Group's order book stood at GBP150.1m
(2015: GBP105.0m) which is made up of UK orders of GBP79.5m (2015:
GBP53.0m) and international orders of GBP70.6m (2015: GBP52.0m) and
is 43% higher than that the same point last year. All three regions
have reported an improving trend with the UK up 50% on the position
in March 2015 and Turkey's order book almost three times higher.
This excellent performance is expected to progress further during
the course of this year and the record level of orders, supported
by a strengthening pipeline of opportunities in all our markets,
underpins the significant growth we anticipate in 2016/7.
Conclusion
Having performed strongly in the first half, our UK business
delivered even better results in the second, accelerating through
the final quarter and creating excellent momentum into the current
financial year. We are seeing an increasing flow of work from our
major public and private sector clients underpinned by continuing
economic growth and infrastructure spending which are the main
drivers of our core front-end planning and consultancy business.
Our three recent acquisitions have helped to secure the Group's
position as a leading UK planning and transport consultant,
strengthened our capability in strategic asset management, and will
help to augment the growth of our UK activities.
Internationally we continue to make very good progress
diversifying into fragile and developing states and we are starting
to see good levels of growth, particularly in central Africa.
Whilst the delay in the ramp up in the EU funding cycle held
revenues back in the first half, we have now started work on some
of the significant new multi-year EU related projects won since the
start of the financial year which we expect to drive performance
during the current year and beyond.
This, combined with our new long term bank facility, improving
win rates, increasing profitability and the exceptionally high
proportion of current year revenue expectations already in our
order book, leaves us well placed to deliver on market expectations
for this year and our aspiration of building towards a profit
before tax of GBP15m by 2018.
Mike McTighe
Chairman
7 June 2016
CONSOLIDATED INCOME STATEMENT
For the year ended 31 March 2016
2016 2015
Note GBP'000 GBP'000
------------------------------ ----- ---------- ----------
Continuing operations
Revenue including share
of joint venture revenues 133,482 130,464
Less share of joint venture
revenues (665) (1,787)
------------------------------ ----- ---------- ----------
Revenue 4 132,817 128,677
Operating expenses (130,377) (127,538)
Share of result of joint
ventures (17) 418
------------------------------ ----- ---------- ----------
Operating profit 3 2,423 1,557
Finance costs (201) (116)
------------------------------ ----- ---------- ----------
Profit before tax 2,222 1,441
Taxation 608 504
------------------------------ ----- ---------- ----------
Profit for the year 2,830 1,945
------------------------------ ----- ---------- ----------
Profit/(loss) attributable
to:
Owners of the parent 2,832 1,923
Non controlling interests (2) 22
------------------------------ ----- ---------- ----------
2,830 1,945
------------------------------ ----- ---------- ----------
Earnings per share 5
Basic 4.0p 2.9p
Diluted 3.9p 2.7p
------------------------------ ----- ---------- ----------
Operating profit for the year includes net costs of GBP4.8m
(2015: GBP4.2m) that are separately disclosed in Note 3.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 March 2016
2016 2015
GBP'000 GBP'000
--------------------------------------- -------- --------
Profit for the year 2,830 1,945
---------------------------------------- -------- --------
Other comprehensive income/(expense):
Currency translation difference (195) (798)
Tax on items taken directly
to equity* (572) -
Impact of defined pension
asset ceiling* 2,060 (1,995)
Remeasurement of net defined
pension liability* 845 1,275
---------------------------------------- -------- --------
Other comprehensive income/(expense)
for the year 2,138 (1,518)
---------------------------------------- -------- --------
Total comprehensive income
for the year 4,968 427
---------------------------------------- -------- --------
Total comprehensive income/(expense)
attributable to:
Owners of the parent 4,970 405
Non controlling interests (2) 22
-------------------------------------- ------ ----
4,968 427
-------------------------------------- ------ ----
* These items will not be reclassified subsequently to the
income statement.
BALANCE SHEET
As at 31 March 2016
2016 2015
GBP'000 GBP'000
--------------------------------- --------- ---------
Non-current assets
Goodwill 18,193 13,895
Other intangible assets 9,295 4,836
Property, plant and equipment 3,181 2,307
Investment in joint ventures 407 418
Investments - -
Deferred tax assets 1,224 511
32,300 21,967
--------------------------------- --------- ---------
Current assets
Work in progress 30,372 21,145
Trade and other receivables 22,842 21,027
Retirement benefit asset 799 -
Tax recoverable 207 81
Cash and bank balances 8,231 12,324
--------------------------------- --------- ---------
62,451 54,577
--------------------------------- --------- ---------
Current liabilities
Trade and other payables (46,682) (39,756)
Current tax liabilities (931) (1,022)
Financial liabilities (3,050) -
(50,663) (40,778)
--------------------------------- --------- ---------
Net current assets 11,788 13,799
--------------------------------- --------- ---------
Non-current liabilities
Financial liabilities (5,000) (514)
Retirement benefit obligation (2,356) (3,014)
Deferred tax liabilities (2,511) (1,104)
Provisions, liabilities
and other charges (5,940) (8,588)
--------------------------------- --------- ---------
(15,807) (13,220)
--------------------------------- --------- ---------
Net assets 28,281 22,546
--------------------------------- --------- ---------
Equity attributable to the
owners of the parent
Share capital 73 72
Hedging and translation
reserve 385 580
Retained earnings 27,791 21,730
--------------------------------- --------- ---------
28,249 22,382
Non controlling interest 32 164
--------------------------------- --------- ---------
Total equity 28,281 22,546
--------------------------------- --------- ---------
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
For the year ended 31 March 2016
Hedging Non controlling
Share & translation Retained interest Total
capital reserve earnings Total GBP'000 equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance as at 1
April 2014 70 1,378 18,381 19,829 258 20,087
Profit for the
year - - 1,923 1,923 22 1,945
----------------------- ----- ------- ------- ----- -------
Other comprehensive
(expense)/income:
Currency translation
differences - (798) - (798) - (798)
Impact of defined
pension asset ceiling - - (1,995) (1,995) - (1,995)
Remeasurement of
net defined benefit
pension liability - - 1,275 1,275 - 1,275
Other comprehensive
expense for the
year - (798) (720) (1,518) - (1,518)
----------------------- ----- ------- ------- ----- -------
Total comprehensive
(expense)/income
for the year - (798) 1,203 405 22 427
----------------------- ----- ------- ------- ----- -------
Share based payments
charge - - 2,891 2,891 - 2,891
Purchase of treasury
shares - - (211) (211) - (211)
Share issue 2 - - 2 - 2
Dividends - - (534) (534) (116) (650)
----------------------- ----- ------- ------- ----- -------
Balance at 31 March
2015 72 580 21,730 22,382 164 22,546
----------------------- ----- ------- ------- ----- -------
Balance as at 1
April 2015 72 580 21,730 22,382 164 22,546
Profit for the
year - - 2,832 2,832 (2) 2,830
----------------------- ----- ------ ------ ----- ------
Other comprehensive
(expense)/income:
Currency translation
differences - (195) - (195) - (195)
Tax on items taken
directly to equity - - (572) (572) - (572)
Impact of defined
pension asset ceiling - - 2,060 2,060 - 2,060
Remeasurement of
net defined benefit
pension liability - - 845 845 - 845
Other comprehensive
(expense)/income
for the year - (195) 2,333 2,138 - 2,138
----------------------- ----- ------ ------ ----- ------
Total comprehensive
(expense)/income
for the year - (195) 5,165 4,970 (2) 4,968
----------------------- ----- ------ ------ ----- ------
Share based payments
charge - - 1,587 1,587 - 1,587
Share issue 1 - - 1 - 1
Dividends - - (821) (821) - (821)
Reduction in minority
shareholding - - 130 130 (130) -
----------------------- ----- ------ ------ ----- ------
Balance at 31 March
2016 73 385 27,791 28,249 32 28,281
----------------------- ----- ------ ------ ----- ------
CASH FLOW STATEMENT
For the year ended 31 March 2016
2016 2015
Note GBP'000 GBP'000
---------------------------------------- ----- --------- ---------
Operating activities
Cash (used in)/generated
from operations 8 (966) 2,404
Interest paid (180) (140)
Tax paid (321) (250)
---------------------------------------- ----- --------- ---------
Net cash (used in)/generated
from operating activities (1,467) 2,014
---------------------------------------- ----- --------- ---------
Investing activities
Purchases of property, plant
and equipment (2,092) (1,372)
Purchases of intangible assets
(computer software) (385) (287)
Purchase of subsidiary undertakings,
net of cash acquired (note
7) (7,875) (1,475)
Net cash used in investing
activities (10,352) (3,134)
---------------------------------------- ----- --------- ---------
Financing activities
Proceeds on issue of shares 1 2
Purchase of treasury shares - (211)
Dividends paid to company
shareholders (note 6) (821) (534)
Dividends paid to non controlling
interests - (116)
Drawdown of loan facility 8,000 -
Net cash generated from/(used
in) financing activities 7,180 (859)
---------------------------------------- ----- --------- ---------
Net (decrease)/increase in
cash and cash equivalents (4,639) (1,979)
Cash and cash equivalents
at beginning of year 12,324 15,195
Effects of foreign exchange
rates on cash and cash equivalents 546 (892)
---------------------------------------- ----- --------- ---------
Cash and cash equivalents
at end of year 9 8,231 12,324
---------------------------------------- ----- --------- ---------
NOTES TO THE ACCOUNTS
1. GENERAL INFORMATION
WYG plc is incorporated and domiciled in England. The address of
its registered office is Arndale Court, Otley Road, Headingley,
Leeds, LS6 2UJ. The company's shares are traded on AIM, a market
operated by the London Stock Exchange plc.
The principal activity of the Group during the period ended 31
March 2016 was that of programme, project management and technical
consultancy. The Group's revenue derives from activities in the UK
and the Group's International division.
The results for the year ended 31 March 2016 have been extracted
from audited accounts which have not yet been delivered to the
Registrar of Companies. The Financial Statements set out in this
announcement do not constitute statutory accounts for the year
ended 31 March 2016 or the year ended 31 March 2015. The financial
information for the period ended 31 March 2015 is derived from the
statutory accounts for that year. The report of the auditor on the
statutory accounts for the year ended 31 March 2016 was unqualified
and did not contain a statement under Section 498 of the Companies
Act 2006.
2. BASIS OF PREPARATION
Of the new standards, amendments and interpretations that are in
issue and mandatory for the financial year end to 31 March 2016,
there is no financial impact on this condensed consolidated
financial report.
Items that are material and whose significance is sufficient to
warrant separate disclosure and identification within the
consolidated accounts are included within separately disclosed
items.
The audited accounts for the year ended 31 March 2016, from
which these results have been extracted, have been prepared on a
going concern basis.
3. DETAILED CONSOLIDATED INCOME STATEMENT
Revenue
including
share Operating Profit
of joint profit before
ventures tax
GBP'000 GBP'000 GBP'000
------------------------------------------ ----------- ------------ ---------
Year ended 31 March
2016
Before separately disclosed
items 133,482 7,221 7,020
Separately disclosed
items - (4,798) (4,798)
------------------------------------------ ----------- ------------ ---------
Total 133,482 2,423 2,222
------------------------------------------ ----------- ------------ ---------
Year ended 31 March
2015
Before separately disclosed
items 130,464 5,802 5,686
Separately disclosed
items - (4,245) (4,245)
------------------------------------------ ----------- ------------ ---------
Total 130,464 1,557 1,441
------------------------------------------ ----------- ------------ ---------
Details of separately disclosed items
2016 2015
GBP'000 GBP'000
------------------------------------- -------- --------
Share option costs (1,475) (2,924)
Amortisation of acquired intangible
assets (1,533) (1,324)
Other (charges)/credits (1,790) 3
Separately disclosed items (4,798) (4,245)
------------------------------------- -------- --------
The Group has incurred a number of material items in the year,
whose significance is sufficient to warrant separate disclosure.
The key elements included within separately disclosed items
are:
-- Annual charge in relation to share option costs.
-- Annual charge for the amortisation of acquired
intangibles.
-- Items included in other (charges)/credits relate to bank
refinancing costs, buyout of the WYD pension scheme, restructuring
and acquisition related costs net of credits relating to the legal
settlement of the 1986 pension scheme and the release of surplus
vacant leasehold provisions.
4. SEGMENTAL INFORMATION
Business segments
IFRS 8 requires segment reporting to be based on the internal
financial information reported to the chief operating decision
maker. The Group's chief operating decision maker is deemed to be
the executive management team comprising Paul Hamer (Chief
Executive Officer) and Sean Cummins (Group Finance Director). Its
primary responsibility is to manage the Group's day to day
operations and analyse trading performance. The Group's segments
are detailed below and are those segments reported in the Group's
management accounts used by the senior management team as the
primary means for analysing trading performance and allocating
resources. The Executive Committee assesses profit performance
using operating profit measured on a basis consistent with the
disclosure in the Group accounts.
The Group's operations are managed and reported by key market
segments:
-- UK;
-- EAA (Europe, Africa and Asia);
-- MENA (Middle East & North Africa including Turkey).
The segment results for the year ended 31 March 2016 are as
follows:
UK EAA MENA Group
2016 2016 2016 2016
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- -------- -------- -------- --------
Revenue
External revenue 96,328 23,941 13,213 133,482
Less share of joint
venture revenues - (665) - (665)
--------------------------- -------- -------- -------- --------
96,328 23,276 13,213 132,817
Operating profit
before central overheads
and separately disclosed
items 10,325 671 258 11,254
Central overheads (4,033)
--------------------------- -------- -------- -------- --------
Operating profit
before separately
disclosed items 7,221
Separately disclosed
items (note 3) (4,798)
--------------------------- -------- -------- -------- --------
Operating profit 2,423
Finance costs (201)
--------
Profit before tax 2,222
Tax 608
--------
Profit for the year 2,830
Loss attributable
to non controlling
interests (2)
Profit attributable
to the owners of
the parent 2,832
--------------------------- -------- -------- -------- --------
4. SEGMENTAL INFORMATION CONTINUED
The segment results for the year ended 31 March 2015 are as
follows:
UK EAA MENA Group
2015 2015 2015 2015
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- -------- -------- -------- --------
Revenue
External revenue 83,926 30,425 16,113 130,464
Less share of joint
venture revenues - (1,787) - (1,787)
--------------------------- -------- -------- -------- --------
83,926 28,638 16,113 128,677
--------------------------- -------- -------- -------- --------
Operating profit before
central overheads
and separately disclosed
items 7,696 1,591 450 9,737
Central overheads (3,935)
--------------------------- -------- -------- -------- --------
Operating profit before
separately disclosed
items 5,802
Separately disclosed
items (note 3) (4,245)
Operating profit 1,557
Finance costs (116)
--------
Profit before tax 1,441
Tax 504
--------
Profit for the year 1,945
--------
Profit attributable
to non controlling
interests 22
Profit attributable
to the owners of the
parent 1,923
--------------------------- -------- -------- -------- --------
5. EARNINGS PER SHARE
The calculation of basic and diluted earnings per share is based
on the following data:
2016 2015
GBP'000 GBP'000
-------------------------------------- -------- --------
Earnings for the purposes of
basic and diluted earnings per
share being profit for the year 2,832 1,923
Adjustment relating to separately
disclosed items (see note 3) 4,798 4,245
Tax impact of separately disclosed
items (599) (92)
-------------------------------------- -------- --------
Earnings for the purposes of
basic and diluted adjusted earnings
per share 7,031 6,076
-------------------------------------- -------- --------
2016 2015
Number Number
----------------------------------- ----------- -----------
Number of shares
Weighted average number of shares
for basic earnings per share 70,638,773 65,803,072
Effect of dilutive potential
ordinary shares:
Share options 1,317,148 5,071,767
Weighted average number of shares
for diluted earnings per share 71,955,921 70,874,839
----------------------------------- ----------- -----------
Earnings per share
Basic 4.0p 2.9p
Diluted 3.9p 2.7p
----------------------------------- ----------- -----------
Adjusted earnings per share
Basic 10.0p 9.2p
Diluted 9.8p 8.6p
----------------------------------- ----------- -----------
The adjusted earnings per share is calculated after excluding
separately disclosed items. This more accurately reflects the
underlying performance of the Group.
6. DIVIDS
The final dividend of 0.7p per share for the year ended 31 March
2015 (2014: 0.5p per share) was paid in November 2015. The interim
dividend of 0.5p per share for the year ended 31 March 2016 (2015:
0.3p) was paid in March 2016. These have been recognised as
distributions in the year, the amounts recognised during the year
were GBP821,000 (2015: GBP534,000).
The directors have proposed a final dividend of 1.0p per share
for the year ended 31 March 2016 (2015: 0.7p). This has not yet
been approved and so is not included as a liability in the
accounts.
7. Business Combinations
On 8 June 2015, WYG Environment Planning Transport Limited, a
wholly owned subsidiary of the Group, acquired 100% of the share
capital of FMW Consultancy Limited.
The following table sets out the provisional fair value of the
net assets acquired and the resulting goodwill:
Carrying Fair Total
value value fair
pre acquisition adjustments value
GBP'000 GBP'000 GBP'000
WIP 30 - 30
Trade and other receivables 296 - 296
Trade and other payables (306) - (306)
Cash 302 - 302
Deferred tax - (218) (218)
322 (218) 104
Goodwill - 417 417
Customer relationships - 1,105 1,105
Order book - 42 42
----------------------------- ----------------- ------------- ---------
Total 322 1,346 1,668
----------------------------- ----------------- ------------- ---------
Satisfied by:
Cash 1,121
Deferred consideration 547
Total 1,668
-------------------------- ------
The deferred consideration is not dependent on the performance
of the acquired business.
7. Business Combinations CONTINUED
On 29 October 2015, WYG Management Services Limited, a wholly
owned subsidiary of the Group, acquired 100% of the share capital
of North Associates (Cumbria) Limited and its subsidiary Taylor and
Hardy Limited.
The following table sets out the provisional fair value of the
net assets acquired and the resulting goodwill:
Carrying Fair Total
value value fair
pre acquisition adjustments value
GBP'000 GBP'000 GBP'000
Property, plant and equipment 68 - 68
WIP 101 - 101
Trade and other receivables 213 - 213
Trade and other payables (375) - (375)
Deferred tax - (517) (517)
7 (517) (510)
Goodwill - 2,355 2,355
Customer relationships - 1,644 1,644
Order book - 1,074 1,074
------------------------------- ----------------- ------------- ---------
Total 7 4,556 4,563
------------------------------- ----------------- ------------- ---------
Satisfied by:
Cash 2,300
Deferred consideration 2,263
Total 4,563
-------------------------- ------
The deferred consideration is contingent on the future
performance of the business and on the collection of certain
working capital balances. The amount included above is not expected
to be materially different from the ultimate payment.
7. Business Combinations CONTINUED
On 5 January 2016, WYG Environment Planning Transport Limited, a
wholly owned subsidiary of the Group, acquired 100% of the share
capital of SCA Planning Limited and its trading subsidiary Signet
Planning Limited.
The following table sets out the provisional fair value of the
net assets acquired and the resulting goodwill:
Carrying Fair Total
value value fair
pre acquisition adjustments value
GBP'000 GBP'000 GBP'000
Property, plant and equipment 98 - 98
WIP 80 - 80
Trade and other receivables 899 - 899
Trade and other payables (1,022) - (1,022)
Cash 819 - 819
Deferred tax - (413) (413)
874 (413) 461
Goodwill - 1,526 1,526
Customer relationships - 2,053 2,053
Order book - 122 122
------------------------------- ----------------- ------------- ---------
Total 874 3,288 4,162
------------------------------- ----------------- ------------- ---------
Satisfied by:
Cash 3,508
Deferred consideration 654
Total 4,162
-------------------------- ------
The deferred consideration is contingent on the future
performance of the business and on the collection of certain
working capital balances. The amount included above is not expected
to be materially different from the ultimate payment
All assets and liabilities including tangible assets were
recognised at their respective fair values. The residual excess
over the net assets acquired is recognised as goodwill in the
accounts.
8. CASH (USED IN)/GENERATED FROM OPERATIONS
2016 2015
GBP'000 GBP'000
------------------------------------------- -------- --------
Profit from operations 2,423 1,557
Adjustments for:
Depreciation of property, plant
and equipment 1,362 1,321
Amortisation of intangible assets 1,979 1,804
Loss on disposal of property, plant
and equipment 58 3
Share options charge 1,475 2,924
------------------------------------------- -------- --------
Operating cash flows before movements
in working capital 7,297 7,609
Increase in work in progress (7,508) (1,201)
Decrease in receivables 365 551
Increase in payables (1,120) (4,555)
------------------------------------------- -------- --------
Cash (used in)/generated from operations (966) 2,404
------------------------------------------- -------- --------
9. ANALYSIS OF CHANGES IN NET CASH/(DEBT)
At Other At
1 April Cash non-cash 31 March
2015 Flows Items 2016
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------ -------- --------- --------- ---------
Cash and cash equivalents 12,324 (4,639) 546 8,231
Bank loans and overdrafts - (8,000) - (8,000)
------------------------------------ -------- --------- --------- ---------
Net cash/(debt) 12,324 (12,639) 546 231
Cash in restricted access accounts (882) (101) (87) (1,070)
------------------------------------ -------- --------- --------- ---------
Unrestricted net cash/(debt) 11,442 (12,740) 459 (839)
------------------------------------ -------- --------- --------- ---------
Restricted cash relates to restricted access accounts in WYG
International Limited. Other non-cash movements represent currency
exchange differences.
ENDS
This information is provided by RNS
The company news service from the London Stock Exchange
END
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