REG - Assoc British Enging - Annual Financial Report <Origin Href="QuoteRef">ASBE.L</Origin> - Part 2
29/07/2015 07:00
- Part 2: For the preceding part double click ID:nRSc3684Ua
useful lives and residual values are reviewed in each financial period.
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or
where shorter, over the term of the relevant lease. The gain or loss arising on the disposal or retirement of an asset is
determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised as income.
The carrying values of property, plant and machinery are reviewed for impairment when events or changes in circumstances
indicate the carrying value may not be recoverable. If any such indication exists, and where the carrying values exceed
the estimated recoverable amount, the assets or cash generating units are written down to their recoverable amounts.
TAXATION
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in
the income statement because it excludes items of income or expense that are taxable or deductible in other years and it
further excludes items that are never taxable or deductible. The Group's liability for current tax is calculated using tax
rates that have been enacted or substantively enacted by the balance sheet date.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP ACCOUNTING POLICIES (continued)
FOR THE YEAR ENDED 31 MARCH 2015
TAXATION (continued)
Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the consolidated financial statements. The deferred tax is not
accounted for if it arises from initial recognition of an asset or liability in a transaction, other than a business
combination, that at the time of the transaction affects neither accounting nor taxable profit nor loss. Deferred tax is
determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are
expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.
Deferred tax is provided on temporary differences arising on investments in subsidiaries, except where the timing of
reversal of the temporary differences is controlled by the Group and it is probable that the temporary difference will not
reverse in the foreseeable future.
Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against
which the temporary differences can be utilised.
RETIREMENT BENEFIT COSTS
For defined benefit retirement schemes, the cost of providing benefits is determined using the Projected Unit Credit
Method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains and losses are recognised
in full in the period in which they occur. They are recognised outside profit or loss and presented in the Group statement
of comprehensive income.
Past service cost is recognised immediately to the extent that the benefits are already vested, and otherwise is amortised
on a straight-line basis over the average period until the benefits become vested.
The retirement benefit obligation recognised in the balance sheet represents the present value of the defined benefit
obligation as adjusted for unrecognised past service cost, and as reduced by the fair value of scheme assets. Any asset
resulting from this calculation is limited to cumulative unrecognised past service cost, plus the present value of
available refunds and reductions in future contributions to the plan.
Actuarial gains and losses, which represent differences between the expected and actuarial returns on the plan assets and
the effect of changes in actuarial assumptions, are recognised in the statement of other comprehensive income in the period
in which they occur.
Pension payments to the group's defined contribution schemes are charged to the income statement as they arise.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short term deposits with a maturity of
three months or less which are subject to an insignificant risk of changes in value.
FINANCIAL INSTRUMENTS
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements
entered into.
Where the contractual obligations of financial instruments (including share capital) are equivalent to a similar debt
instrument, those financial instruments are classed as financial liabilities. Financial liabilities are presented as such
in the balance sheet. Finance costs and gains or losses relating to financial liabilities are included in the income
statement. Finance costs are calculated so as to produce a constant rate of charge on the outstanding liability.
Where none of the contractual terms of share capital meet the definition of a financial liability then this is classed as
an equity instrument. Dividends and distributions relating to equity instruments are debited direct to equity.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP ACCOUNTING POLICIES (continued)
FOR THE YEAR ENDED 31 MARCH 2015
FINANCIAL INSTRUMENTS (Continued)
Further analysis of the Group's financial instruments, and the relevant exposure to risks and uncertainties, is stated in
note 19 below and the various classifications of financial assets and liabilities are identified and explained.
Trade and other receivables
Trade and other receivables are originally recognised at fair value, net of transaction costs. Subsequent measurement is at
amortised cost using the effective interest rate method. A provision against trade receivables is made when there is
objective evidence that the Group will not be able to collect all amounts due to it in accordance with the original terms
of those receivables. The total of bad and doubtful debts at the year-end was £86,000 (2014: £79,000). Trade receivables
and cash and cash equivalents are classified as loans and receivables.
Trade and other payables
Trade and other payables are originally recognised at fair value, net of transaction costs. Subsequent measurement is at
amortised cost using the effective interest rate method.
Investments in securities
Investments are recognised and derecognised on a trade date where a purchase or sale of an investment is under a contract
whose terms require delivery of the investment within the timeframe established by the market concerned, and are initially
measured at fair value, with all transaction costs being written off to the income statement as incurred.
Investments are classified as available for sale and are measured at subsequent reporting dates at fair value. Gains and
losses arising from changes in fair value of available for sale financial assets are included in other comprehensive income
for the period. When the asset is disposed of or deemed to be impaired, the cumulative gain or loss is reclassified from
equity reserve to profit or loss.
Reclassification of financial assets held for trading to available for sale financial assets
The investments in securities were previously classified as held for trading in the financial statements. The directors
have considered the nature of the investment portfolio in the context of IAS 39 and have determined that it is more
appropriate to classify the investment portfolio as assets available for sale rather than held for trading. Therefore the
financial assets of £129,000 as at 31 March 2014 have been reclassified on the balance sheet as available for sale.
As a consequence of this change future gains and losses on the investment portfolio will pass through other comprehensive
income rather than the profit and loss and be recorded in an Available for Sale Reserve. In the year to 31 March 2015, an
unrealised gain of £75,000 has been recognised within other comprehensive income, of which an £84,000 gain relates to the
investment addition in the year, and a £10,000 loss relates to the investments previously classified as held for trading.
The impact of this change on the prior year results was £39,000 which is not considered to be material and so no
restatement of the prior year profit and loss account and statement of comprehensive income has been made. In the year
ended 31 March 2015 £14,000 has been transferred from retained earnings to a separate Available for Sale reserve to reflect
this change. This change has no impact on reported net assets.
IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT
At each balance sheet date the Group reviews the carrying amounts of its property, plant and equipment to determine whether
there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable
amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does
not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the
cash-generating unit to which the asset belongs.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP ACCOUNTING POLICIES (continued)
FOR THE YEAR ENDED 31 MARCH 2015
IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT (continued)
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use the
estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash
flows have not been adjusted. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than
its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An
impairment loss is recognised as an expense immediately, unless the relevant asset is carried at a revalued amount, in
which case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the
revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount
that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior
years.
SEGMENTAL REPORTING
The standard requires financial information to be disclosed in the financial statements in the same format in which it is
disclosed to the chief operating decision-maker. The chief decision-maker has been identified as the Board, at which level
strategic decisions are made.
EQUITY AND RESERVES
Share capital represents the nominal value of shares that have been issued except for the preference shares classified as
debt.
Deferred shares represents shares arising from the sub-division of ordinary shares of £2.
Share premium includes any premiums received on issue of share capital. Any transaction costs associated with the issuing
of shares are deducted from share premium, net of any related income tax benefits.
Retained earnings include all current and prior period retained profits and losses.
Available for sale reserve includes all gains and losses relating to Available for Sale financial assets.
Other reserves relate to movements not classified in any of the reserves detailed above.
All transactions with owners of the parent are recorded separately within equity.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP INCOME STATEMENT
FOR THE YEAR ENDED 31 MARCH 2015
Note 2015 2014
£'000 £'000
REVENUE 1 2,626 2,667
Operating costs 2 (2,757) (2,975)
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OPERATING LOSS (131) (308)
Finance expense 7 (70) (45)
Finance income 7 22 25
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LOSS BEFORE TAXATION (179) (328)
Taxation 8 (6) 12
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LOSS FOR THE YEAR (185) (316)
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EARNINGS PER SHARE ON LOSS FOR THE YEAR
ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT COMPANY
BASIC AND DILUTED 9 (7.5p) (4p)
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Loss for the year attributable to:
Owners of the Company (153) (99)
Non-controlling interests (32) (217)
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(185) (316)
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All activities are classified as continuing.
Note:
Investments in securities previously classified as held for trading were reclassified as available for sale financial
assets. As a consequence of this change, gains and losses on the investment portfolio in the company as from April 2014
will pass through other comprehensive income rather than the income statement and be recorded in the Available for Sale
Reserve. In the year to 31 March 2015, an unrealised gain of £75,000 has been recognised within other comprehensive
income, of which an £84,000 gain relates to the investment addition in the year, and a £10,000 loss relates to the
investments previously classified as held for trading. The impact of this change on the prior year results was £39,000
(increased loss) that would be in other comprehensive income and not in income statement; which is not considered to be
material and so no restatement of the prior year income statement and statement of comprehensive income has been made.
The accounting policies on pages 13 to 19 and the notes on pages 25 to 41 form part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2015
Note 2015 2014
£'000 £'000
Loss for the year (185) (316)
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Other comprehensive income
Re-measurement of the net defined benefit liability (*) 17 (566) (580)
Gain on available for sale financial asset (**) 74 -
Reclassification of realised gain/loss on available for sale financial assets (**) 1 -
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Other comprehensive income for the year (491) (580)
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TOTAL COMPREHENSIVE LOSS FOR THE YEAR (676) (896)
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Total comprehensive loss attributable to:
Owners of the Company (644) (679)
Non-controlling interests (32) (217)
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(676) (896)
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(*) = Items which will not subsequently be reclassified to the Income Statement.
(**) = Items which may subsequently be reclassified to the Income Statement.
All activities are classified as continuing.
The accounting policies on pages 13 to 19 and the notes on pages 25 to 41 form part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC Company Number: 00110663
GROUP BALANCE SHEET
31 MARCH 2015
Restated
2015 2014
Note £'000 £'000
ASSETS
Non-current assets
Property, plant and equipment 10 321 364
Available for sale financial assets 14 417 129
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738 493
Current assets
Inventories 12 939 1,052
Trade and other receivables 13 603 527
Cash and cash equivalents 2,606 2,992
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4,148 4,571
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Total assets 4,886 5,064
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EQUITY AND LIABILITIES
Called up share capital 15 51 51
Deferred shares 15 2,594 2,594
Share premium account 5,370 5,370
Other components of equity 11 11
Available for Sale financial assets 89 -
Retained earnings (5,927) (5,227)
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Equity attributable to the Company's Equity shareholders 2,188 2,799
Non-controlling interests (6) 59
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Total equity 2,182 2,858
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LIABILITIES
Non-current liabilities
Retirement benefit obligation 17b 1,892 1,414
Obligation under finance leases 18 107 172
Deferred tax liabilities 20 8 2
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2,007 1,588
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Current liabilities
Trade and other payables 18 632 553
Obligations under finance leases 18 65 65
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697 618
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Total liabilities 2,704 2,206
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Total equity and liabilities 4,886 5,064
====== ======
2,704
2,206
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-------------
Total equity and liabilities
4,886
5,064
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======
The financial statements were approved and authorised for issue by the Board of Directors on 28 July 2015
and were signed below on its behalf by:
C Weinberg
Director
The accounting policies on pages 13 to 19 and the notes on pages 25 to 41 form part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2015
Share capital Share premium Deferredshares Other reserve Available for Sale Financial Assets Retained earnings Attributa-ble to owners of the parent Non-controll-ing interest Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 April 2013 51 5,370 2,594 11 - (4,548) 3,478 276 3,754
Loss for the year - - - - - (99) (99) (217) (316)
Other comprehensive income
Actuarial loss in defined benefit plan (*) - - - - - (580) (580) - (580)
-------------- -------------- ---------------- -------------- -------------- --------------- --------------- --------------- ---------------
Total comprehensive income for the year - - - - - (679) (679) (217) (896)
-------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
Balance at 31 March 2014 51 5,370 2,594 11 - (5,227) 2,799 59 2,858
-------------- -------------- --------------- -------------- -------------- --------------- --------------- --------------- ---------------
Loss for the year - - - - - (153) (153) (32) (185)
Other comprehensive income
Actuarial loss in defined benefit plan (*) - - - - - (566) (566) - (566)
Unrealised gain on Available For Sale financial assets (**) - - - - 74 - 74 - 74
Reclassification of realised gain/loss on Available For Sale financial assets (**) - - - - 1 - 1 - 1
Transfer from retained earnings to Available for Sale financial assets - - - - 14 (14) - - -
Transactions with owners
Purchase of shares from non-controlling interest - - - - - 33 33 (33) -
-------------- -------------- --------------- -------------- -------------- --------------- --------------- --------------- ---------------
Total comprehensive income for the year - - - - 89 (700) (611) (65) (676)
-------------- -------------- --------------- -------------- -------------- --------------- --------------- --------------- ---------------
Balance at 31 March 2015 51 5,370 2,594 11 89 (5,927) 2,188 (6) 2,182
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(*) = Items which will not be subsequently be reclassified to the Income Statement.
(**) = Items which may subsequently be reclassified to the Income Statement.
The accounting policies on pages 13 to 19 and the notes on pages 25 to 41 form part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 MARCH 2015
2015 2014
£'000 £'000
Cash flows from operating activities
Cash used in operations (52) (445)
Interest received 22 20
Interest paid (70) (5)
----------------- -----------------
Net cash used in operating activities (100) (430)
----------------- -----------------
Cash flows from investing activities
Proceeds from sale of equipment 6 -
Purchase of equipment (10) (37)
Purchase of investments (220) (13)
Sale proceeds from trading investments 3 5
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Net cash used in investing activities (221) (45)
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Cash flows from financing activities
Repayment of finance leases (65) (65)
----------------- -----------------
Net cash used in financing activities (65) (65)
----------------- -----------------
Net decrease in cash and cash equivalents (386) (540)
Cash and cash equivalents at beginning of year 2,992 3,532
----------------- ----------------
Cash and cash equivalents at end of year 2,606 2,992
========= ========
CASH FLOW FROM OPERATING ACTIVITIES
2015 2014
£'000 £'000
Loss before taxation (179) (328)
Adjustments for:
Depreciation 53 53
Interest income (22) (20)
Finance expense 70 5
Foreign exchange difference (4) -
Pension scheme interest expense 62 40
Cash paid in excess of current service cost (150) (137)
Profit on disposal of equipment (6) -
Profit/(loss) on disposal of Available For Sale investments 7 (1)
Changes in working capital:
(Increase)/decrease in inventories 113 (23)
(Increase)/decrease in trade and other receivables (76) (30)
Increase/(decrease) in payables 80 35
Fair value gains in investments - (39)
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(52) (445)
Taxes paid - -
------------ ------------
Cash used in operations (52) (445)
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=====
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The accounting policies on pages 13 to 19 and the notes on pages 25 to 41 form part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP
FOR THE YEAR ENDED 31 MARCH 2015
1. SEGMENTAL REPORTING
The following table shows an analysis of the Group's external sales by geographical market:
2015 2014
£'000 £'000
United Kingdom 844 1,081
Europe 664 813
Far East and Australasia 383 98
Africa 40 314
North and South America 652 331
Middle East 43 30
Russia - -
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2,626 2,667
====== ======
The following table shows an analysis of the Group's external sales from continuing operations:
2015 2014
£'000 £'000
Revenue from the sale of goods 304 -
Revenue from the rendering of services 2,322 2,667
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2,626 2,667
====== ======
All of the above revenue arises from diesel and related engineering activities and originates in the United Kingdom.
In the years ended 31 March 2015 and 31 March 2014 all of the assets held by the Group were located in the United Kingdom
and all capital expenditure was incurred within the United Kingdom.
Operating segments
The following segment information has been prepared in accordance with IFRS 8, "Operating Segments", which defines
requirements for the disclosure of financial information of an entity's operating segments.
The Board consider the Group on an individual company basis. Reports by individual companies are used by the chief
decision-maker in the Group. Significant operating segments are Associated British Engineering Plc, British Polar Engines
Limited and Akoris Trading Limited.
The Group's operations are located in the United Kingdom. Any transactions between business units are on normal commercial
terms and conditions.
British Polar Engines Limited's activities consist of the manufacture and supply of diesel engines and spare parts for
diesel engines together with associated repair work.
Akoris Trading Limited's activities consist of commodity and natural resource trading, finance and investment.
Associated British Engineering Plc is the Group holding company.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
1. SEGMENTAL REPORTING (continued)
Year to 31 March 2015 Associated British Engineering Plc British Polar Engines Limited Akoris Trading Limited Consolidated
£'000 £'000 £'000 £'000
External sales - 2,322 304 2,626
------------- ------------- ------------- -------------
Segment result (LBIT/PBIT) (139) 171 (163) (131)
------------- ------------- -------------- -------------
Net finance expenses (48)
Taxation (6)
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Loss after tax (185)
=====
Other information
Capital additions - 10 - 10
Balance sheet
Segment assets 210 4,640 36 4,886
====== ====== ====== ======
Year to 31 March 2014 Associated British Engineering Plc British Polar Engines Limited Akoris Trading Limited Consolidated
£'000 £'000 £'000 £'000
External sales - 2,667 - 2,667
------------ ------------ ------------ ------------
Segment result (PBIT) (182) 308 (434) (308)
------------ ------------ ------------ ------------
Net finance expenses (20)
Taxation 12
------------
Profit after tax (316)
======
Other information
Capital additions - 37 - 37
Balance sheet
Segment assets 288 4,443 333 5,064
====== ====== ====== ======
Included in the total Group revenue was £549,000 (2014: £585,000) of sales which arose from 1 customer who contributed to
10% or more of the total Group revenue for the year ended 31 March 2015 (2014: two customers). The geographical market
from which the revenue from the 1 customer originates is the Unites States of America.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
2. OPERATING COSTS 2015 2014
£'000 £'000
Changes in inventories 113 (23)
Raw materials used 1,114 1,109
Staff costs 1,103 1,156
Depreciation and amortisation 53 52
Other expenses 374 681
---------------- ----------------
2,757 2,975
====== ======
3. OPERATING LOSS 2015 2014
£'000 £'000
Operating loss is stated after charging/(crediting)
Depreciation on owned assets 20 20
Depreciation on assets held under finance leases 33 33
Fees payable to the Company's auditor for the audit of the Company's annual accounts:
PLC audit costs 23 22
The audit of the Company's subsidiaries pursuant to legislation 20 18
Operating lease rental on plant and machinery 34 35
Profit on disposal of property, plant & equipment 6 -
====== ======
4. STAFF COSTS AND EMPLOYEES 2015 2014
£'000 £'000
Wages and salaries 905 1000
Social security costs 91 107
Other pension costs 105 107
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1,101 1,214
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The average monthly number of persons employed by the Group during the year was:
2015 2014
Number Number
By activity
Production 10 11
Administration 18 19
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28 30
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ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
5. DIRECTORS' REMUNERATION
Directors received emoluments of £49,000 (2014: £45,000). Further details can be found on page 57.
6. KEY MANAGEMENT COMPENSATION 2015 2014
£'000 £'000
Remuneration of Group directors 49 45
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The Group made no pension contributions in respect of Group directors during the year ended 31 March 2015 or 31 March
2014.
7. NET FINANCE EXPENSE 2015 2014
£'000 £'000
Interest on obligations under finance leases 8 5
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Interest expenses for borrowings at amortised cost 8 5
Net interest cost on defined benefit pension scheme 62 40
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70 45
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Interest receivable on cash and cash equivalents (22) (25)
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(48) (20)
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ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
8. TAXATION 2015 2014
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