REG - Braemar PLC - Final Results
Today 07:00
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RNS Number : 1678F Braemar PLC 21 May 2026
21 May 2026
BRAEMAR PLC
("Braemar", "the Company" and together with its subsidiaries the "Group")
Audited Financial Results for the year ended 28 February 2026
Strong strategic progress reinforces confidence in FY30 growth targets
FY26 results in line with expectations
Braemar Plc (LSE: BMS), a leading provider of expert chartering, investment
and risk management advice to the shipping and energy markets, announces its
audited results for the year ended 28 February 2026 ("FY26").
James Gundy, Group CEO of Braemar, commented:
"We made significant strategic progress in FY26 towards our stated ambition of
delivering £200m of revenue by FY30. This included expanding our geographic
footprint, launching new capabilities and completing a share buyback
programme, all while successfully navigating a period of considerable
geopolitical uncertainty. Our performance in line with expectations
demonstrates the value and resilience of our diversified business model and
reinforces our confidence in Braemar's ability to perform across market
cycles.
"We enter the new financial year with strong momentum, a strengthening forward
order book and a leadership team focused on disciplined execution. As the
situation in the Middle East continues to evolve, our priority remains
supporting our clients with high-quality advice, market insight and execution
capability. In a fragmented industry, we believe that this environment also
provides opportunities to deepen client relationships and gain market share.
"This is my final set of results as Group CEO, as I step down from the board
in July to focus on my shipbroking activities. This decision was made from a
position of confidence in Braemar's leadership, strategy and future prospects.
I am immensely proud of what this team has built together, transforming our
operational platform, broadening our service offering, expanding our global
reach and laying the foundations for the next chapter of growth.
"I am confident that the business will be in excellent hands under Grant's
leadership as our new CEO. My commitment to Braemar, and my belief in what it
can achieve, remain as strong as ever and I look forward to continuing to
contribute to the success of the business in my broking role as we pursue our
growth ambitions."
Financial Performance
Underlying results* Statutory results
FY26 FY25 % change FY26 FY25 % change
Revenue £135.6m £141.9m (4%) £135.6m £141.9m (4%)
Operating profit (before acquisition-related expenditure) £13.2m £16.7m (21%) £12.4m £16.0m (23%)
Operating profit £12.4m £15.6m (20%) £7.7m £11.2m (31%)
Profit before tax £10.1m £13.4m (25%) £4.6m £9.2m (50%)
Earnings per share (basic) 24.23p 31.30p (23%) 7.24p 19.41p (63%)
Total dividend per share 7.0p 7.0p - 7.0p 7.0p -
(*) Underlying results measures above are before specific items, including
some acquisition-related expenditure and corporate costs
· Resilient financial performance:
o Continued strong cash generation with net cash generated from operations of
£12.1m (FY25: £5.9m)
o Group revenues of £135.6m (FY25: £141.9m), reflecting weaker chartering
rates in the first half, partially offset by strong performances in S&P
and Risk Advisory, highlighting the benefits of the Group's diversified
business model
o Underlying operating profit (before acquisition-related expenditure) of
£13.2m (FY25: £16.7m)
o The Group returned to a net cash position in March 2026, in line with the
Group's normal working capital cycle, after ending the year with net debt of
£2.9m (FY25: net debt £2.5m)
Operational Highlights
· Strong progress against strategic framework targets set out in
FY25:
o Expansion into new jurisdiction with the opening of the Cape Town office,
Braemar's first office in Africa
o Key senior hires made throughout the year, strengthening desk capabilities
o Globalisation of tankers operations
o Launch of a UK Organised Trading Facility ("OTF") enhancing and further
supporting the growth in the Risk Advisory business
· Completion of a £2 million share buyback representing the
board's confidence in Braemar's intrinsic value and long-term growth
trajectory
Final Dividend
The board is proposing a final dividend for the year ended 28 February 2026 of
4.5 pence per share for approval by shareholders at the Company's Annual
General Meeting to be held on 2 July 2026. Subject to shareholder approval,
the final dividend will be paid on 7 September 2026 to shareholders who are on
the register at the close of business on 31 July 2026, with a corresponding
ex-dividend date of 30 July 2026. The last date for Dividend Reinvestment Plan
("DRIP") elections will be 14 August 2026.
Outlook
· Strong current trading and strengthening forward order book
o Trading in the first two months of the new financial year has been strong
o Geographic and revenue stream diversity is helping to mitigate the effect
of ongoing geopolitical disruption
o The structural drivers underpinning demand for Braemar's services remain
compelling, with a robust forward order book of $72.5m at 28 February 2026
(FY25: $82.2m), increasing to $77.9m as at 30 April 2026
· Continued strategic progress
o Approval received in May for an office in the Dubai International Financial
Centre
o Approval for European OTF expected in first half of the new financial year
· FY27 output set:
o Hiring 10 new brokers
o Establish one new desk in Risk Advisory
o Embed AI across the business
o Complete one complementary M&A transaction
· Confident in FY30 growth targets
o With a reinforced operational platform, a clear long‑term plan and
a strong pipeline of opportunities, the Board is confident of further
progress and of delivering annual revenue of £200m by FY30
Board
As previously announced on 17 February 2026, James Gundy will step down as
Group CEO and a director of the Company at the Annual General Meeting on 2
July 2026 and Grant Foley will succeed James as Group CEO. James will remain
with the Group and focus on his shipbroking activities.
Analyst Presentation
Management will host a briefing for analysts at 09:00 BST today
at Braemar's offices at One Strand, Trafalgar Square, London, WC2N 5HR. For
further details, please contact the team at Houston
via braemar@houston.co.uk.
Investor Webcast
Braemar will also host a webcast via the Investor Meet Company platform later
today, commencing at 14:00 BST. The presentation is open to all existing and
potential shareholders. Questions can be submitted pre-event via the Investor
Meet Company dashboard up until 09:00 BST this morning, or at any time during
the live presentation.
Investors can sign up to Investor Meet Company for free and add to meet
BRAEMAR PLC via:
https://www.investormeetcompany.com/braemar-plc/register-investor
(https://url.uk.m.mimecastprotect.com/s/LE27CDRPmF08rG6TWfrUj6OW2?domain=investormeetcompany.com)
The 2026 Annual Report and Accounts will be available on the Company's website
(www.braemar.com (http://www.braemar.com) ) shortly.
Enquiries:
Braemar Plc Tel: +44 (0)20 3142 4100
James Gundy, Group Chief Executive Officer
Grant Foley, Group Chief Financial and Operating Officer
Rebecca-Joy Wekwete, Company Secretary
Houston Tel: +44 (0)20 4529 0549
Kate Hoare / Charlie Barker / Polly Clarke Tel: +44 (0)77 3303 2695
braemar@houston.co.uk (mailto:braemar@houston.co.uk)
Canaccord Genuity Tel: +44 (0) 20 7523 8000
Adam James / Harry Rees
About Braemar Plc
Braemar provides expert advice in shipping chartering, investment and risk
management to enable its clients to secure sustainable returns and mitigate
risk in the volatile world of shipping. Our experienced brokers work in tandem
with specialist professionals to form teams tailored to our customers' needs,
and provide an integrated service supported by a collaborative culture.
Braemar joined the Official List of the London Stock Exchange in November 1997
and trades under the symbol BMS.
For more information, including our investor presentation,
visit www.braemar.com (http://www.braemar.com/) and follow Braemar
on LinkedIn (https://www.linkedin.com/company/braemar-ltd) .
Chairman's Statement
FY26 has validated the board's strategy. Disciplined execution and operational
delivery continue to unlock new opportunities and reinforce confidence in the
Group's future.
I am pleased to present Braemar's Annual Report for the financial year ended
28 February 2026, a year in which the Group's diversified operating model once
again demonstrated its strength by reducing our exposure to volatility in any
single market segment, enabling resilient performance through shifting market
conditions.
FY26 marked the commencement of operations under our updated strategic
framework, which is underpinned by a commitment to operational excellence,
diversifying our revenue streams and disciplined market consolidation. This
framework was announced in May 2025 and provides a clear statement of our
ambitions to grow, amongst other things, to at least £200 million of revenue
by FY30, as well as one-year operational targets to mark our progress.
I am delighted to report that we have made good progress against these
objectives during the year and, notwithstanding ongoing geopolitical
uncertainty, maintained a clear focus on disciplined execution. The Group has
strengthened its platform further and is well positioned to achieve
sustainable future growth.
Overview of the Year
The macroeconomic environment during the year was challenging, marked by
volatility in energy markets, ongoing geopolitical uncertainty and an evolving
regulatory environment. Nevertheless, the Group delivered a solid operational
and financial performance. Its financial results are in line with the board's
expectations, underscoring the resilience of the Group's diversified business
model and the enduring strength of our client relationships.
As anticipated, the second half of the year delivered a notably stronger
performance than the first, reflecting improved market conditions and
demonstrating the Group's ability to successfully balance and optimise its
exposure across chartering, investment advisory and risk management
activities.
Revenue for the year was £135.6 million (FY25: £141.9 million), and
underlying operating profit (before acquisition-related expenditure) was
£13.2 million (FY25: £16.7 million).
Net debt at year-end remained consistent at £2.9 million (FY25: £2.5
million) with the Group returning to a net cash positive position during March
2026.
Operational and Strategic Progress
In FY26 we were pleased to see the board's objectives, set out in our
strategic framework, immediately start to translate into operational and
strategic results. These results included:
· Opening Braemar's first office in Africa, establishing a new
jurisdictional footprint and supporting our ambition to expand our influence
across emerging markets;
· Enhancing our Risk Advisory business through the launch of a UK
Organised Trading Facility, enabling greater operational depth and market
access;
· Strengthening leadership capability with a number of key senior
hires across the Group; and
· Completing a £2 million share buyback programme, reflecting the
board's confidence in Braemar's intrinsic value and long-term growth
trajectory.
In addition, the board continues to actively evaluate complementary
acquisition opportunities that support the Group's objective. Through these
evaluations, a rigorous and highly selective due diligence process is applied,
and a transaction will only proceed through to completion if there is a clear
strategic alignment and confidence in long-term value creation.
Middle East Conflict
The escalation of conflict across the Middle East, and the effective closure
of the Strait of Hormuz has resulted in the most significant disruption to
global shipping since the 2021 Suez blockage. A significant proportion of the
world's oil and gas products pass through the Strait and this closure has led
to increased energy prices and freight rates globally.
For Braemar, this backdrop presents both uncertainty and opportunities for
growth. Periods of geopolitical disruption tend to reward resilient,
well-invested platforms with strong operational execution and diversified
revenue streams. Braemar's operating model and disciplined investment in
talent and systems, position the firm well to navigate current geopolitical
challenges effectively.
Board Changes
In February 2026, James Gundy announced his intention to step down as Group
Chief Executive Officer ("Group CEO") and as a director of the Company at the
Annual General Meeting on 2 July 2026 ("AGM"). Following the AGM, James will
continue with the business, focusing on his shipbroking activities, where he
has over 40 years' experience.
I am pleased to confirm that the board appointed Grant Foley, currently Group
Chief Financial and Operating Officer (CEO designate), to succeed James as
Group CEO with effect from 2 July 2026. I would like to extend my sincere
thanks to James for his leadership and contribution over the past five years.
During his tenure, he has reshaped Braemar, profitably divested non-core
operations, eliminated a significant debt burden and built a more diversified
and resilient shipbroking business. I am delighted that, after stepping down,
James will remain with the Group to continue serving his broking clients.
Grant joined the Company in 2023 and since that time, it has been clear that
he has all the operational, financial and strategic skills to be the natural
choice to succeed James. The board is confident that his extensive operational
experience and knowledge of the business mean that Grant is ideally placed to
lead the Group in the next stage of its growth. The search for a new Chief
Financial Officer is progressing well, and I expect to give an update in due
course.
Dividend
The board will recommend a final dividend for the year ended 28 February 2026
of 4.5 pence for approval by shareholders at the Company's AGM. This payment
is in line with our updated Capital Allocation Framework announced in May 2025
and designed to reflect a balance between growth investment and returning cash
to shareholders.
The final dividend, together with the interim dividend of 2.5 pence paid on 13
January 2026, represents a total dividend of 7.0 pence, in line with last
year's total payment. The final dividend will be paid on 7 September 2026 to
shareholders who are on the register at the close of business on 31 July 2026,
with a corresponding ex-dividend date of 30 July 2026. The last date for
Dividend Reinvestment Plan ("DRIP") elections will be 14 August 2026.
Outlook
As we enter FY27, we do so with a reinforced operational foundation, a clear
long‑term plan and a strong pipeline of opportunities. These elements
position us well to advance towards our ambition of becoming the trusted
broker of choice for the shipping and energy markets, delivering annual
revenues of at least £200m by FY30, with a 15% underlying operating profit
margin and balance sheet leverage under 1.5x EBITDA.
We look to the future with increasing confidence.
Acknowledgements
On behalf of the board, I would like to thank our colleagues across the Group
for their hard work, professionalism and commitment throughout the year. Their
contribution has been central to navigating a complex market landscape while
delivering on our long-term strategic goals. I would also like to express our
appreciation to our clients and shareholders for their continued trust and
support.
Braemar's future remains bright. With a proven model, a global footprint, a
clear strategic path and an energised workforce, we are well placed to
strengthen our position in the shipping and energy markets in the years ahead.
Nigel Payne
Chairman
20 May 2026
Group Chief Executive Officer's Statement
As I approach the end of my tenure as Group CEO, I find myself reflecting not
only on the past five and a half years in this role, but on a longer journey -
from my time as CEO of ACM, through the merger with Braemar in 2014, and my
subsequent role as CEO of Shipbroking within the Group. Each of those chapters
shaped my thinking and gave me the clarity of vision that has guided the
transformation of Braemar into the business it is today.
When I stepped into the Group CEO role, I had three clear priorities: to
reduce debt, to return the business to its core foundations in shipbroking,
and to build out selectively into complementary areas where we had genuine
expertise and competitive advantage. We were disciplined - growing only where
we truly understood the market and could add real value for clients.
Over the course of my tenure we have meaningfully expanded our global
footprint, entering new geographies and growing our presence in markets that
are strategically important to our clients. Our expansion into the United
States, and the acquisition of Southport in particular, has been a significant
milestone - that location is central to a key part of our client base and has
opened doors to new sectors within the shipbroking space.
One of my longest-held ambitions was to move Braemar into the securities and
derivatives space. The acquisition of Atlantic Securities in 2017 - a
regulated business focused on physical coal and swaps - provided exactly the
platform we needed. From that foundation we have built out across multiple
desks, focusing on sectors that complement our shipbroking heritage. Braemar
Securities is now a core and growing part of the Group, and I have
considerable confidence in its future trajectory.
I am immensely proud of how the business has evolved and performed during this
period. Revenue has grown by 62%, underlying operating profit has increased by
71%, and net debt has been materially reduced. These are not just financial
metrics - they reflect the sustained effort of an exceptional team and the
strength of the strategy we have pursued together.
FY26 has been a year of resilient delivery, demonstrating once again that the
diversification strategy was the right one. We enter the next phase of our
journey with a strong platform firmly in place, and I am highly confident in
Braemar's prospects and the opportunities that lie ahead.
It has been a privilege to work alongside such an exceptional team. During my
tenure, the Group has navigated periods of rapid growth, global uncertainty,
and significant change. Throughout this time the resilience, integrity and
commitment of our people have been one of our greatest strengths. Together we
have expanded our market presence, advanced our strategic priorities, and
established firm foundations for long-term, sustainable growth and success.
Through diversification, an expanded global reach, and a culture in which
talent can thrive and clients are fully supported, Braemar is now a more
resilient and sustainable business. These achievements reflect a truly
collective effort, driven by a sense of shared purpose and aligned values.
I would like to thank all our employees for their dedication and
professionalism, our clients for their trust, and our shareholders and
partners for their unwavering support. I am also grateful to the board for its
guidance, insight, and constructive challenge throughout my time as Group CEO.
The Group enters its next chapter from a position of strength. Grant Foley
brings exceptional capability to the Group CEO role, and having worked closely
with him for the past three years, I am confident that the business is in
excellent hands. I have no doubt that Braemar will continue to evolve,
innovate, and deliver long-term value for all stakeholders.
While I am stepping down from the Group CEO role, I am returning my full focus
to what I have always loved most - broking. It is the work that drew me to
this industry and, if I am honest, the work I never really stopped doing. My
belief in this organisation, and my commitment to its people and its future,
remain as strong as ever.
Robust Performance
FY26 was a year of disciplined execution, with Braemar making good operational
progress in support of the growth objectives set out in our strategic
framework in May 2025. All this was again achieved against a challenging and
volatile macroeconomic environment backdrop, with the year characterised by
the resilience of our performance as we continued to invest in our growth
platform and capitalise on opportunities.
Market conditions remained complex, shaped by geopolitical uncertainty,
disrupted trade flows, and an evolving regulatory landscape. The escalation of
conflict affecting Red Sea and Middle East shipping routes significantly
reshaped tonne mile demand, voyage economics, and freight risk dynamics,
underscoring the importance and value of high-quality advisory insight and
risk management expertise.
Against this backdrop, the Group delivered a resilient operational
performance, with momentum building through the second half of the year.
For FY26, the Group delivered revenue of £135.6 million (FY25: £141.9
million), a decrease of 4%, in line with expectations and primarily reflecting
reduced chartering rates. This was partly offset by strong performances in
Sale and Purchase and Risk Advisory. Chartering rates improved during the
second half of the year although overall US dollar revenues were at similar
levels. This leaves the business well positioned for improved performance
ahead.
Underlying operating profit (before acquisition related costs) of £13.2
million (FY25: £16.7 million) was £3.5 million lower year on year,
reflecting the reduced revenue. Operating expenditure remained well controlled
during the year while continuing to support targeted investment in both senior
revenue-generating roles and operational infrastructure. We strengthened our
compliance capability and implemented enhanced technology solutions to further
support our brokers and improve efficiency across the business.
Strong progress on strategic priorities
Our growth strategy is built around three pillars:
1. Operational Excellence
2. Diversification
3. Consolidation
During the year, the Group made good progress executing our strategy, further
enhancing resilience, deepening client engagement, and strengthening the
platform required to achieve our FY30 ambitions, including reaching annual
revenues of at least £200 million and 15% underlying operating profit margin.
Our diversified business model continued to perform as intended, effectively
balancing exposure across physical chartering, investment advisory, and risk
management activities, with the Group well positioned to capitalise on organic
and acquisitional growth opportunities as they arise.
Strategic Pillars in Action
Operational Excellence
Operational excellence remains a core enabler of the Group's sustainable
growth strategy. During the year further progress was made in strengthening
governance, systems and processes across the business, alongside continued
investment in technology, data, and infrastructure. These initiatives,
together with ongoing focus on regulatory compliance, are enhancing
scalability, resilience and the quality of decision making across the Group.
Cost discipline remained a clear priority, particularly during softer market
conditions in the first half of the year. Targeted investment in talent also
continued.
Collectively these actions underpinned accelerating second half momentum and
positioned the Group to enter FY27 with improved operational readiness, a
strong platform for continued growth and the ability to capture opportunities
as they arise.
Diversification
Diversification remains integral to Braemar's ability to deliver consistent
performance across shipping and market cycles, supporting earnings resilience
while providing multiple avenues for growth. During FY26, the Group continued
to benefit from the breadth of its activities across Chartering, Investment
Advisory and Risk Advisory.
Risk Advisory further expanded its contribution, supported by the launch of
our UK Organised Trading Facility and Cross Commodities during the year with a
further desk expected to be launched in FY27.
Geographic diversification also advanced during the year, with the opening of
the Group's first office in Africa, extending Braemar's jurisdictional
footprint. This geographic expansion strengthens local market access, enhances
client coverage and further positions the Group to capitalise on long-term
growth opportunities across key emerging markets.
Consolidation
In line with our strategy, we continue to actively evaluate complementary
acquisition opportunities during the year. Our approach remains highly
disciplined with a clear focus on strategic fit, cultural alignment, and
shareholder value creation. While a limited number of opportunities advanced
through enhanced due diligence, the Group remained steadfast in applying its
rigorous investment framework and will not proceed where a transaction does
not fully meet return and risk thresholds. This approach reflects our
commitment to prudent capital allocation, maintaining strategic focus and
creating sustainable value for shareholders.
Furthermore, the Group remained focused on consolidating its operating
platform with continued investment in consistency, governance, and
collaboration. During the year we further embedded a more integrated operating
model, enhancing alignment across physical broking, advisory and risk
management teams. This integration is enabling deeper client relationships,
more efficient capital and risk oversight and clearer accountability across
regions and business lines. Importantly, these enhancements have been achieved
while preserving the Group's entrepreneurial culture, underpinned by a
disciplined and robust control framework that supports sustainable growth.
Sustainability and Responsible Business
Sustainability considerations are playing an increasingly important role in
client decision making, particularly across asset investment, fleet renewal,
and risk management. We are well positioned to support clients as they respond
to regulatory change, evolving emissions requirements, and energy transition
related investment decisions. This is reflected in growing demand for advisory
services across sale and purchase, corporate finance and risk advisory
reinforcing the relevance of the Group's diversified expertise in a changing
market environment.
Internally, the Group remains focused on strong governance, responsible
business practices, and disciplined capital allocation, supporting long term
value creation for shareholders.
Outlook
While geopolitical and macroeconomic uncertainty continues, the structural
drivers underpinning demand for Braemar's diversified services remain strong.
Ongoing disruption to global trade patterns, increasing regulatory complexity
and heightened market volatility continue to reinforce the importance of
specialist advice and sophisticated risk management solutions. This underpins
sustained demand for the Group's capabilities.
As the Group enters FY27, it does so from a position of increased strength,
supported by continued investment in our operating platform, improving
momentum, a strong forward order book and clear strategic objectives to
support sustainable future growth. As a result, the business is well
positioned to capture opportunities across market cycles and support the
Board's confidence of achieving our FY30 growth ambitions to establish Braemar
as the trusted broker of choice in global shipping and energy markets,
generating at least £200m revenue with a 15% underlying operating profit
margin.
I would like to thank our clients for their continued trust, our colleagues
for their commitment and professionalism throughout FY26 and our shareholders
for their ongoing support. With a resilient operating model, a strong
forward order book, M&A opportunities being evaluated and a clear
long-term strategy, Braemar is well positioned to navigate future challenges,
invest selectively and deliver sustainable value over the long term.
I am excited by the opportunities for the Group under Grant's leadership, and
look forward to contributing to the business in the years ahead.
James Gundy
Group Chief Executive Officer
20 May 2026
Financial Review
Revenue
Revenue from continuing operations declined 4% year on year, reflecting softer
conditions in chartering markets, particularly in the first half of the
financial year. This impact was partially mitigated by strong performances in
Sale and Purchase and Risk Advisory underlining the benefits of the Group's
diversified, advisory-led model and its increasing resilience. The Group
continued to invest selectively in its operating platform during the period
and trading momentum improved during the second half as chartering rates
strengthened. Overall, second half revenues were 11% higher than the first
half.
Chartering revenues declined 16% to £74.7 million (FY25: £89.4 million)
reflecting weaker market conditions and the restructuring of the Tanker and
Dry Cargo broking desks. Investment Advisory revenues increased by 6% to
£32.1 million (FY25: £30.2 million), driven by a strong performance in Sale
and Purchase. Risk Advisory saw strong growth with revenues increasing 29% to
£28.8 million (FY25: £22.3 million), further demonstrating the value of the
Group's diversification.
The majority of the Group's revenues are denominated in US dollars. During the
year, sterling strengthened against the US dollar moving from $1.26 at the
start of the year to $1.35 at the end of the year, which had an adverse
translation impact on reported revenues. Total revenues at $177 million were
modestly lower than the prior year (FY25: $179 million).
Foreign exchange exposure continues to be actively managed. At 28 February
2026, the Group held forward currency contracts to sell $75.9 million at an
average rate of US$1.30/£1.
At 28 February 2026, the Group's forward order book stood at $72.5 million
(FY25: $82.2 million) with $37.6 million contracted to convert within the next
12 months, providing meaningful near-term revenue visibility. The reduction
from the prior year primarily reflects a lower Chartering forward book, partly
offset by a robust Sale and Purchase pipeline. This forward order book
provides a sound foundation for the board's confidence in the Group's
near-term trading outlook and supports expectations for FY27.
Operating Profit and Profit before tax
The Group delivered underlying profit (before acquisition-related expenditure)
of £13.2 million, 21% lower than the prior year and underlying profit before
tax of £10.1 million, a 25% reduction compared with the prior year. This
outcome primarily reflects the impact of lower revenues from weaker chartering
markets, particularly during the first half of the year. Costs discipline
remained strong throughout the period and the business generated strong
operating cash flow of £12.1 million (FY25: £5.9 million).
The Group enters FY27 with a strong forward order book and a clear strategic
framework designed to build and support sustainable and resilient performance.
• Underlying operating profit (before acquisition-related expenditure)
£13.2 million (FY25: £16.7 million).
• Underlying operating profit £12.4 million (FY25: £15.6 million).
• Underlying profit before tax £10.1 million (FY25: £13.4 million)
• Statutory operating profit £7.7 million (FY25: £11.2 million).
• Statutory profit before tax £4.6 million (FY25: £9.2 million).
Operating costs
Underlying operating costs were £121.4 million, a reduction of £2.7 million
compared with the prior year (FY25: £124.1 million). While the Group
continued to invest in people and technology to support its strategic
priorities, overall expenditure declined largely due to lower bonus costs
reflecting reduced financial performance for the year.
Central costs
Central costs increased to £7.2 million (FY25: £5.6 million) reflecting the
full-year impact of the Group's London headquarters at One Strand as
previously sublet space was vacated by occupying tenants, investment in senior
leadership and governance and further enhancements to the Group's compliance
and control infrastructure. These investments strengthen the Group's operating
platform and support long term scalability.
Specific items
The Group uses Alternative Performance Measures ("APMs") as key financial
indicators to assess underlying performance. Management considers that these
APMs provide a useful complement to statutory measures by excluding items that
do not relate to underlying trading performance for the period. This approach
is to assist investors and other stakeholders in evaluating the ongoing
performance of the Group.
Items that are not considered part of the Group's underlying trade are
presented separately as specific items, where their size and/or nature could
otherwise distort interpretations of operating performance. Further details
are set out in Note 2.2 to these Financial Statements.
FY26 FY25
£'000 £'000
Underlying operating profit before specific items and acquisition-related 13,180 16,731
expenditure
Acquisition-related expenditure (757) (1,134)
Underlying operating profit before specific items 12,423 15,597
Specific items - Acquisition-related expenditure (3,952) (3,711)
Specific items - Other operating costs (782) (928)
Specific items - Other operating income - 215
Operating profit 7,689 11,173
Acquisition-related expenditure includes the final charge of £2.9 million
associated with the acquisition of Southport Maritime Inc. (FY25: £3.6
million). Other operating costs include £0.4 million (FY25: £0.7 million)
relating to the impairment of a right-of-use lease asset.
Net finance costs
Net finance costs for the year increased by £1.3 million to £3.3 million
(FY25: £2.0 million). This increase reflects a £0.7 million fair value loss
on forward currency contracts not designated for hedge accounting (FY25:
£nil), lower interest income on bank deposits of £0.2 million and a £0.4
million increase in foreign exchange losses on financing liabilities compared
with the prior year. Interest payable on the Group's revolving credit facility
at £2.2 million was in line with FY25.
During the year, one of the Group's forward exchange contract counterparties
entered administration. Hedge accounting was discontinued from the point of
identification, giving rise to the fair value loss of £0.7 million recognised
within the finance costs. This has been treated as a specific item as it does
not reflect the Group's underlying hedging strategy.
Taxation
The Group's underlying effective tax rate in FY26 was 24.8% (FY25: 26.7%)
reflecting the global nature of the Group's operations.
Dividend
Reflecting the board's confidence in the Group's cash generation, balance
sheet and medium-term prospects whilst also being mindful of disciplined
capital allocation, the board has recommended a final dividend of 4.5 pence
(FY25: 2.5 pence) per share. Subject to shareholder approval at the AGM on 2
July 2026, the dividend will be paid on 7 September 2026.
The total dividend of 7.0 pence for the year (FY26: 7.0 pence) is covered 3.5
times by the underlying earnings per share from operations of 24.23 pence. The
total cash outflow in respect of dividends paid during the year ended 28
February 2026 was £1.6 million (FY25: £5.5 million), and the Group completed
its £2 million share buyback programme during the year.
Balance sheet
Net assets at 28 February 2026 were £82.4 million, a decrease of £1.8
million compared with the prior year (FY25: £84.2 million). Total assets
reduced by £2.0 million over the period, reflecting lower trade and other
receivables (£1.7 million), property, plant and equipment (£1.3 million) and
deferred tax assets (£1.2 million). These movements were partially offset by
increases in cash balances (£2.9 million) and derivative assets (£1.8
million).
Total liabilities decreased marginally by £0.2 million. This primarily
reflected the repayment of the Group's convertible loan notes (£2.4 million)
and utilisation of the uncertain commission obligation provision (£1.9
million), offset by increased trade and other payables (£2.6 million)
consistent with the timing of activity towards the year end.
Goodwill of £71.4m was tested for impairment during the year with no
impairment identified. The Chartering segment demonstrated headroom of £7.7
million, providing a strong degree of comfort. The Corporate Finance cash
generating unit carries more limited headroom of £0.4 million, reflecting the
inherently highly variable nature of M&A success fees in the current
market environment. The board remains focused on strengthening the Corporate
Finance pipeline to support the sustainable long-term value of this business.
Borrowings and Cash
At the Balance Sheet date, the Group had access to a £40 million revolving
credit facility with HSBC. The facility also includes a global cash pooling
arrangement in the UK, USA, Germany and Singapore supporting efficient
liquidity management across the Group's core operating regions. Net debt at
the end of the year comprising £26.3 million of revolving credit facilities
and £23.4 million of cash, was £2.9 million (FY25: £2.5 million), in line
with the Group's usual working capital cycle.
Cash flow
The Group generated net cash from operations of £12.1 million in FY26 (FY25:
£5.9 million), reflecting strong profit conversion and a working capital
inflow of £2.2 million (FY25: £12.0 million outflow) as receivables and
payables were actively managed. Cash deployment across financing activities
totalled £9.7 million, comprising the £2.0 million share buyback, £4.1
million of ESOP share purchases to support employee participation, £1.6
million of dividends and the final £2.6 million settlement of the Naves
convertible loan notes. Capital expenditure remained disciplined at £1.4
million.
ESOP Trust
During the year, the Group purchased 1.8 million shares for the ESOP (£4.1
million) to satisfy commitments under its DBP and LTIP employee share schemes.
Together with the £2.0 million buyback programme, total capital deployed in
share-related activity was £6.1 million in FY26.
At year end, the ESOP Trust held 1,080,697 shares, which management expects to
be sufficient to meet anticipated near-term vesting requirements. Full details
of the schemes are provided in Note 6.3.
Retirement benefits
The Group's defined benefit pension scheme, which was closed to new members
during FY16, recorded a surplus of £3.5 million at 28 February 2026 (FY25:
surplus £2.5 million). This surplus has been recognised on the balance sheet.
The most recent funding valuation carried out as at March 2023 showed a
surplus of £0.3 million.
Capital management
Capital allocation decisions are made in the context of the Group's FY30
ambition to deliver annual revenues of at least £200 million. The board
remains committed to funding organic and selective inorganic growth
opportunities, maintaining balance sheet discipline and returning cash to
shareholders in line with the Capital Allocation Framework, while preserving
the financial flexibility to invest in the operating platform during the next
phase of growth.
The Group actively manages its capital structure in response to changes in
economic conditions and business requirements. This may include adjustments to
shareholder distributions, capital returns or the issuance of equity and debt
instruments where appropriate. The Group seeks to maintain positive cash
balances where possible, supported by the prudent and flexible use of its
revolving credit facility to manage seasonal working capital requirements.
Going concern
Based on the trading cash flows generated during the year and the Group's
available liquidity, the board considers the Group to be in a robust liquidity
position. The Group will continue to apply a prudent approach to working
capital forecasting and credit management. The revolving credit facility,
which expires in November 2027, provides sufficient headroom to support
seasonal working capital requirements. Accordingly, the accounts have been
prepared on a going concern basis.
Leadership Transition
As announced on 17 February 2026, I will transition from the role of Group
Chief Financial and Operating Officer to Group Chief Executive Officer
following the AGM on 2 July 2026.
Since joining Braemar almost three years ago, the focus has been on building a
finance function that is resilient, well governed and capable of supporting
the Group through a range of market conditions. I am confident that the
financial reporting infrastructure, risk management framework and treasury
capabilities now in place provide a strong and disciplined foundation for the
next phase of the Group's development.
I would also like to acknowledge the strength, professionalism and commitment
of the wider finance team. They have played a central role in navigating a
period of market volatility while continuing to raise standards across
financial control, governance and insight. I have full confidence in the team
to maintain this momentum and support the Group effectively under new
leadership.
The board has commenced the process to appoint my successor as Group Chief
Financial Officer and an announcement regarding the appointment will be made
in due course.
Grant Foley
Group Chief Financial and Operating Officer (CEO designate)
20 May 2026
Operating Review
Braemar demonstrated resilience through its diversified revenue streams, with
its global, advisory‑led platform driving second‑half momentum. Having
invested across the Group, Braemar enters FY 27 with compelling opportunities
ahead.
Chartering
Revenue decreased by 16% to £74.7 million (FY25: £89.4 million), primarily
reflecting weaker chartering rates in the first half.
Braemar's global platform and integrated chartering capability underpinned a
resilient performance amid shifting trade patterns and market disruption.
Chartering revenue declined year‑on‑year reflecting weaker rates in the
first half and some internal restructuring, with the business now strengthened
and positioned for growth. Throughout this period client relationships
remained strong and rates saw some improvement in the second half. The
business enters the new financial year on a strong footing and is well
positioned for growth.
Tankers
The tanker market remained volatile during the year, with a notable
improvement during the second half. Ongoing international sanctions, shifts in
global oil trade flows and evolving supply dynamics continued to reshape
voyage economics and increase operational complexity across the sector.
Against this backdrop clients placed growing emphasis on regulatory
compliance, operational flexibility and risk management alongside freight rate
considerations.
Throughout the year, Braemar's tanker teams supported clients across both spot
and longer‑term chartering activity. By combining timely market insight with
effective execution support, the teams helped optimise commercial outcomes and
manage risk in a challenging trading environment reinforcing Braemar's role as
a trusted adviser amid changing market conditions.
Dry Cargo
Despite growth in longer distance trades supporting demand for larger vessel
classes, earnings across the dry cargo sector remained constrained by uneven
demand for key commodities and continued pressure from vessel supply. Market
conditions varied significantly, by region and cargo, with headline rates
often masking underlying volatility, with activity levels improving in the
second half of the year. In this environment clients prioritised income
stability and operational flexibility over short-term rate optimisation.
Braemar's dry cargo teams were active across all major vessel segments,
supporting clients with both transaction execution and broader chartering
strategy. Demand was strongest for advisory services relating to shipment
timing, route optimisation and contract structuring rather than purely price
driven fixtures. Selective opportunities emerged during the year, particularly
within the minor bulks segment, where cargoes linked to cleaner energy
transition and infrastructure development performed well.
Specialised Products
Specialised Products comprises of Specialised Tankers, Liquid Petroleum Gas
("LPG"), Petrochemicals and Liquid Natural Gas ("LNG").
Specialised Tankers
Fleet growth and moderating demand weighed on earnings across the year,
although sanctions‑related longer routings supported vessel utilisation in
certain trades. Market conditions promoted a more selective approach from
clients with increased focus on vessel suitability, regulatory compliance and
contractual complexity.
Against this backdrop Braemar's Specialised Tankers team delivered
advisory‑led chartering solutions, supporting clients with both near‑term
execution and longer‑term commercial planning and helping manage risk in a
complex operating environment.
LPG and Petrochemicals
LPG and Petrochemicals markets were more balanced though trading conditions
remained complex. Trade flows continued to be influenced by regional pricing
differentials, infrastructure constraints and margin volatility. Clients
focussed on managing logistical risk carefully while retaining flexibility in
vessel coverage.
Braemar's LPG and Petrochemicals team supported clients through route
optimisation, tailored contract structures and flexible coverage solutions,
with activity strengthening in the second half.
LNG
The LNG Tanker market remained challenging, reflecting continued vessel
oversupply following significant fleet deliveries and delayed growth in
liquefaction capacity. Charter rates averaged at historically low levels for
much of the year, despite a brief seasonal improvement during the winter
period. Conditions began to stabilise towards the end of the year with early
signs of recovery emerging.
Braemar's LNG team provided advisory and execution support across spot, term
and project‑related charters assisting clients in navigating a difficult
market while positioning for an eventual improvement in market conditions.
Offshore Energy Services
Strong offshore investment momentum in recent years has driven a sharp uplift
in demand across the sector. With limited vessels built over the past decade,
fleet supply remains constrained, underpinning very high utilisation levels
and robust day‑rate pricing. This imbalance has also supported a buoyant
second‑hand market with asset values rising across both modern and legacy
tonnage.
Newbuild activity has been highly selective, focussed primarily on subsea
construction vessels and specialised wind support assets. In contrast,
Offshore Support Vessel ordering has remained muted reflecting disciplined
capital allocation and the ongoing requirement for long‑term contract
visibility to secure financing .As a result, clients continue to adopt
flexible, returns-driven contracting strategies, prioritising capital
efficiency.
Investment Advisory
Investment Advisory's revenue increased by 6% to £32.1 million (FY25:
£30.2 million) as Sales and Purchase activity remained strong.
Sale and Purchase
Second-hand activity remained robust during the year, supported by firm
earnings, elevated asset values and ongoing fleet renewal. Transaction volumes
were strongest in the bulk carrier and tanker markets, with improved momentum
also evident in the containership sector. Market uncertainty in the first half
of the year led some clients to defer decision-making, with activity
accelerating in the second half as visibility improved. Elevated pricing
levels placed increased emphasis on valuation discipline, timing and execution
quality. Against this backdrop Braemar supported clients through targeted
market advice, valuation insight and consistent transaction execution,
enabling both buyers and sellers to transact effectively despite changing
market sentiment and price sensitivity.
Newbuilding activity remained elevated with contracting concentrated in the
tanker and gas sectors. High asset prices, extended shipyard lead times and
ongoing regulatory uncertainty around future emissions standards continued to
shape investment decisions and added complexity to the contracting
environment. Alternative‑fuel considerations were central to investment
decisions and newbuilding strategies, with LNG dual‑fuel propulsion the
preferred option. Braemar worked closely with clients to navigate technical,
regulatory and commercial considerations underpinning newbuild investment.
Through the provision of market intelligence, comparative analysis and
strategic advice, Supporting informed capital allocation and risk-adjusted
investment decisions across an evolving market landscape, consistent with its
advisory-led approach.
Corporate Finance
Corporate Finance activity reflected a selective transactional environment
during the year, shaped by geopolitical uncertainty, tighter financing
conditions and fluctuating asset valuations which collectively extended
decision‑making timelines. In this context, clients focussed on balance
sheet resilience, strategic flexibility and long‑term positioning.
Braemar advised on a range of mandates including M&A, minority
investments, restructurings and bespoke capital solutions. Engagement levels
were strongest where independent advice was required on capital structure,
refinancing and portfolio review. While public market activity remained
subdued, private capital continued to provide support, particularly within
specialist shipping and energy‑transition sectors.
Risk Advisory
Risk Advisory's revenue increased by 29% to £28.8 million (FY25: £22.3
million) in reflecting increased volatility and demand for risk management
solutions.
The Risk Advisory business delivered a strong performance during the year,
benefiting from elevated market volatility and continued growth in client
demand for structured risk management solutions. The Group's integrated
physical and financial model, combined with leading positions in core markets,
supports resilient revenue generation and positions the business to capture
further growth as market complexity and hedging requirements increase.
Dry Cargo Derivatives
Ongoing volatility in dry bulk markets drove strong demand for freight hedging
and trading activity, as clients sought greater earnings visibility and
balance sheet protection. While near-term risk management remained a
consistent source of revenue, activity increasingly shifted towards more
structured, longer-dated hedging solutions aligned with underlying physical
exposure.
Braemar's integrated model, combining physical dry cargo broking with
derivatives expertise, provides differentiated market insight and execution
capability. This positioning supported deeper client engagement and reinforced
the Group's role in delivering scalable, sophisticated risk management
solutions.
Coal
Coal markets continued to generate significant trading activity, with regional
dislocations and price volatility underpinning liquidity despite the
longer-term structural transition in global energy markets.
Braemar's coal desk delivered a strong performance, supported by its leading
position in the European-delivered Amsterdam-Rotterdam-Antwerp market. The
desk remains a key contributor to market liquidity and price formation,
leveraging deep physical market knowledge alongside financial execution.
Integration with the Group's freight and commodity advisory further enhances
client relevance and supports consistent flow generation.
Natural Gas Derivatives
Volatility across global gas markets sustained robust demand for active and
structured risk management solutions. Clients increasingly adopted more
complex hedging strategies to manage risk across both physical and financial
exposures.
Braemar's Natural Gas desk continued to expand its advisory and analytical
capabilities, with a focus on structured solutions and scenario-driven
analysis. Ongoing investment in coverage and analytics positions the business
to capture growth in a market of increasing strategic importance both for
clients and in the context of the broader energy transition.
Tanker Derivatives
Tanker Derivatives, the Group's joint venture with GFI, remains one of the
leading facilitators of liquidity in wet freight and LPG FFAs.
Market conditions, shaped by sanctions, evolving trade flows and capacity
constraints, supported sustained client engagement throughout the year. The
business delivered a strong performance, driven by higher participation and
volumes and supported by close alignment with the physical tanker broking
platform.
Cross Commodities
The Cross Commodities desk was established to address rising demand from
clients managing risk across interconnected freight, fuel and energy markets.
Leveraging the breadth of Braemar's Securities platform, the desk provides
coordinated multi-market access through a single point of execution. Early
progress has been encouraging, with strong client engagement, and the platform
is well placed to scale as cross-commodity risk management becomes an
increasingly important driver of client activity.
Principal Risks and Uncertainties for the Year Ended 28 February 2026
Risk Management
Effective risk management forms an integral part of how we operate. It is
essential for delivering our strategic objectives as well as protecting our
relationships and reputation.
The Group's Risk Management Framework
Risk awareness is a key element of Braemar's organisational culture at all
levels and is key in managing risks to our business, helping to ensure the
process of risk identification, assessment and response is embedded within
daily operational and functional activities across the Group.
The board is responsible for managing the Group's risks, overseeing the
internal control framework, and determining the nature and extent of the
principal risks the Group is willing to take to achieve its long- term
objectives. The Group's risk management and internal control frameworks are
continually monitored and reviewed by the board and the Audit and Risk
Committee, with support from the Risk Committee. The board is committed to
maintaining the highest standards of conduct in all aspects of its business,
but in considering the other matters set out in Section 172 of the Companies
Act 2006, the directors are mindful that the approach must be balanced with
both Employee interests and the Group's need to foster business relationships.
Group policies and procedures have been designed to ensure that the level of
risk to which the Group is exposed is consistent with the Group's risk
appetite and aligned with the Group's long-term strategy.
Reporting to the Chair of the Audit and Risk Committee and administratively to
the Chief Financial and Operating Officer, the Head of Internal Audit and Risk
leads the Internal Audit and Risk Management function.
Risk management process
The Group's Risk Management framework incorporates both bottom-up and top-down
identification, evaluation, and management of risks. Within our framework:
· senior management have initial responsibility for identifying,
monitoring, and updating business risks, while
· the management teams of Group IT, HR, Legal, Compliance and
Finance assess their respective functions for operational and functional risks
not identified by senior management.
The Group's risk management framework is managed via an online system which is
accessible to the senior management team and operational and functional
management teams globally. The system's functionality has allowed for enhanced
monitoring and reporting automation. The system allows for:
· Group-wide real-time updating,
· Distribution and completion of periodic internal control
self-assessment surveys,
· Ongoing monitoring of risks and mitigation activities at Group,
operational, and functional levels, and
· Risk management reporting at Group, regional, and company
location levels.
The Group's risk management framework considers both the likelihood and the
impact of identified risks materialising. Risks are mitigated, where possible,
by the implementation of control activities, which are evaluated as part of
the risk-based internal audit plan to determine their effectiveness in
mitigating or reducing risk to acceptable levels.
All identified risks are aggregated and reviewed to assess their impact on the
Group's strategic objectives and the resources required to manage them
effectively. Principal risks are aggregated together with associated issues or
areas of uncertainty. Inherent risks can be significant, but our control
processes and management actions reduce the risk level.
The risk management process evaluates the timescale over which new or emerging
risks may occur. The risk management process also considers the potential
impact and likelihood of risks, as well as the timescale over which risks may
occur. The outcome of this process is then reviewed with further consideration
and assessment provided by the Risk Committee, the Audit and Risk Committee,
and the board.
Oversight and evaluation of the effectiveness of Braemar's risk management
framework is led by the Group Chief Financial and Operating Officer, supported
by the Risk Committee whose membership includes the Company Secretary, Head of
Internal Audit and Risk, Head of Compliance, and representatives of other
functions and locations of the business. The Risk Committee monitors risks
regularly, taking into consideration the appetite, tolerance, and potential
impact for specific risks on the Group.
Principal Risks
The principal risks which may impact the Group's ability to execute its
strategic objectives have remained unchanged since 2025. The risks that
follow, whilst not exhaustive, are those principal risks which we believe
could have the greatest impact on our business and have been discussed at
meetings of the board, the Risk Committee and the Audit and Risk Committee.
The board reviews these risks in the knowledge that currently unknown,
non-existent or immaterial risks could turn out to be significant in the
future and confirms that a robust assessment has been performed. The Audit and
Risk Committee review and approve the principal risks and any related
mitigation plans.
In today's increasingly complex and volatile global environment, Braemar
recognises the heightened risks and uncertainties that impact our operations.
Geopolitical instability, economic fluctuations, and evolving regulatory
landscapes contribute to a challenging risk management landscape. We remain
committed to proactively identifying, assessing, and mitigating these risks to
ensure the resilience and sustainability of our business.
Risk Mitigation
As part of our risk management process, the Group takes various measures to
mitigate risk throughout the year. These measures include:
· Ongoing periodic review and updating of policies and procedures,
including AML and KYC, to enhance/strengthen the Group's Governance Framework,
with ongoing monitoring of Employee training completion rates.
· A signature authorisation and delegation of authority policy,
complemented by independent assurance activities.
· Usage of common finance, HR and operations systems across the
Group supported by our IT team.
· Strategic recruitment supported by the Group HR team.
· Establishment of board-approved Group budgets with ongoing
performance monitoring against budgets/reforecasts and investigation of
significant variances.
· Regular reporting of treasury management activity to the board by
the Group Chief Financial and Operating Officer.
· Ongoing monitoring of contractual risk by the Group legal team.
· Operation of the Group's whistleblowing procedure.
· Maintenance of appropriate insurance cover.
· Continued investment in Information Technology and Cyber Security
to strengthen security policies, technical and operational controls, skilled
resources and up-to-date training dedicated to the prevention of cybercrime.
· Compliance systems and processes used to manage the risk of
financial crime and sanctions breaches in an increasingly complex environment.
Regular functional reporting of existing department risks, emerging risks and
the status of ongoing mitigation measures.
Principal Risks
The directors have carried out an assessment of the principal and emerging
risks facing the Group. The most significant risks to which the board
considers the Group is exposed, based on the evaluation process described in
the Group's Risk Management Framework are set out below.
Risk Summary of impact Mitigating control and management actions
Competition and Market Consolidation · Maintain a geographically diverse and balanced shipbroking and -
securities offering to prevent overreliance on a single broker, location or
revenue stream.
Competition in the shipping industry is becoming increasingly intense, and Loss of established brokers could · Quarterly horizon-scanning exercises are conducted by the executive
there is a growing trend towards market consolidation, and hiring established
leadership team which assess emerging trends in the market and identify areas
brokers as companies seek to gain scale and reduce costs. impact revenues. Increasing of the business that could be targeted by competitors.
consolidation could impact the · Annual review of compensation and reward with external benchmarking
helps to ensure remuneration packages continue to be appropriate and
Group's M&A strategy for growth. competitive, supporting the attraction and retention of high-performing
brokers.
Cybercrime/data security · Developed a two-year Security & Resilience Strategy with -
board-level approval. Implementation of a robust set of risk controls through
Loss of service and associated loss of revenue. adoption of the National Institute of Standards & Technology ("NIST")
Cyber Security Framework and ISO 27001 Standard
Cybercrime could result in loss of business assets or disruption to the
Group's IT systems and its business. Lack of appropriate data security could
· IT processes prioritise cybersecurity through regular penetration
result in loss of data. Reputational damage. testing, endpoint protection, and a trusted third-party software-defined wide
area networking (SD-WAN) solution, software patching, frequent complex
password changes, MFA, strict access control procedures, and tested IT
Disaster Recovery Plans.
Potential for material losses due to fraud or phishing.
· Mandatory security awareness training is delivered to all employees to
reinforce cyber risk awareness, promote secure behaviours, and reduce the
likelihood of phishing and other cyber‑enabled attacks.
· Outsourced security operations centre ("SOC") supporting the wider
cyber security control environment by providing continuous monitoring,
enhanced threat detection and response capabilities, reduced incident impact
through continuous monitoring, ensuring faster remediation by centralising
security operations. Cyber due diligence for third-party risk to evaluate the
security posture of vendors and identify vulnerabilities, prevent unauthorised
access, and mitigate exposure to cybercrime through external attack vendors.
Geopolitical and macroeconomic A downturn in the world economy could affect transaction volumes, resulting in · Diversification on a sector and geographic basis reduces dependency on ↑
reduced revenue. individual business areas.
· Monthly performance review of each business area in each region to
Braemar's businesses are reliant on global trade flows and as such may be
ensure the Group is appropriately resourced across its activities and
negatively impacted by geopolitical and/or macroeconomic issues, such as Changes in shipping rates, disruption to key shipping routes, and/or changes geographies.
changes in crude oil price, restrictions in global trade due to pandemics, in the demand or pricing of commodities could affect global supply activity.
sanctions, and changes in supply and demand.
· Ongoing management of costs based on current and reasonably foreseeable
market conditions. The brokers' bonus is based on profits and is therefore
responsive to market swings.
Note:
· Enhanced KYC procedures and ongoing monitoring of compliance with
Conflict in Russia, Ukraine and the Middle East, associated disruption to governance policies, sanctions, and other legal / regulatory requirements
shipping volumes, and an increasingly complex global sanctions regime, have across the Group to help ensure laws and regulations are not breached.
heightened geopolitical and macroeconomic risks, and the challenge of
regulatory compliance. · The diverse service offering, led by experts in their fields, means the
Group is in the best position to find new opportunities in volatile market
conditions and able to take advantage of market turnarounds.
Political change, ongoing regional conflicts, increased trade tensions,
tariffs and sanctions have heightened geopolitical and macroeconomic risks.
These developments can lead to increased volatility in international markets,
affecting trade relationships, investment decisions, and economic stability
worldwide.
Compliance with laws and regulations Legal and regulatory breaches could result in fines, sanctions being imposed · Group-wide training program to help ensure employee awareness of, and -
on our business, and the loss of Braemar's ability to continue operating. compliance with, all relevant legal and regulatory obligations:
Ø Braemar Corporate Governance Framework;
Braemar generates revenues from a global business that exposes the Group to
risks associated with legal and regulatory requirements. Failure to meet all reporting obligations could lead to reputational damage Ø Braemar Risk Management Methodology;
which could then lead to loss of revenue and staff.
Ø Compliance with our policies, including our AML/KYC policies' (enhanced)
customer due diligence requirements; and
The associated risk relating to the increasingly complex and fast-moving Ø Compliance with relevant laws & regulations, including Anti-bribery and
sanctions regime is identified as a separate standalone principal risk, Corruption regulations.
'Sanctions and trade restrictions'.
· Enhanced KYC procedures and ongoing monitoring of compliance with
governance policies and legal/regulatory requirements across the Group to help
ensure requirements are not breached.
· A global network of legal advisors is used for expert advice on complex
and/or regional matters, where applicable.
· For the Securities business, lexicons and transcripts from
communication monitoring solutions are regularly reviewed to detect any
potential inappropriateness or wrongdoing.
· Gifts received and issued are recorded on a Gifts Register which is
reviewed by the Compliance function against tiered approval thresholds.
Currency fluctuations (incl. Market Volatility) A change in exchange rates could result in a financial gain or loss. • The Group hedges in accordance with the Hedging Strategy. Forward -
currency (US $) contracts are entered into to mitigate the risk of adverse
The Group is exposed to foreign exchange risk because a large proportion of currency movements.
its revenue is generated in US dollars while its cost base is in multiple
currencies. • Hedging performance is regularly reported into the Executive
Committee, Board and other relevant governance structures.
The increase in risk is driven by heightened geopolitical volatility
Disruptive technology Relationships could be devalued and replaced by disruptive technology • Investment in technology through partnering with -
platforms, resulting in increased competition, consequent price reductions, best-in-class providers.
and loss of revenue.
• Quarterly horizon-scanning exercises are conducted by the
Shipbroking is still largely a business that is transacted via personal leadership team which aim to identify emerging trends and disruptive forces in
relationships dependent on quality service. Hence the risk of technological this area whilst monitoring the competitive landscape.
change (including artificial intelligence), disintermediation and increased
customer demands for enhanced technological offerings could render aspects of
our current services obsolete, potentially resulting in loss of customers.
Environment and Climate Change The Group's P&L and liquidity could be negatively impacted if customers • Investment in the offshore renewables market and technology to allow -
are lost as a result of our not keeping pace with our peers and industry the Group and its clients to offset carbon emissions.
best-practice.
• Ongoing development and ESG strategy which allows the Group to monitor
Seaborne transportation is estimated to create approximately 3% of the world's and report on environmental and climate-related risks.
carbon emissions and there will be increased pressure to reduce that in future
years. Failure to monitor and address the risks associated with that reduction Non-compliance with regulations or disclosure requirements could result in
process could result in loss of revenue for Braemar and its customers and
counterparties fines or penalties.
Failure to appropriately monitor and mitigate these risks could lead to
Braemar suffering serious reputational damage.
Note:
Management does not expect climate-related risks to have a material impact on
the Group's short-term financial performance.
Integration Risk Inefficiencies and/or reduced expected synergies realised after integrating • Performance of new business is monitored through regular dialogue with -
new acquisitions into the group and aligning them with the respective group relevant business leaders.
strategies.
• Focus on alignment of systems, processes and teams to optimise
Braemar's shipbroking-focussed growth strategy makes use of strategic hires efficiencies, support synergy realisation and actively retain key leadership
and acquisitions to increase the size of the business.
and team members through structured integration planning and engagement.
Inappropriate recognition and/or consolidation of newly acquired net assets
and profits could undermine the reliability of the Group's financial • Compliance and legal mechanisms in place to ensure the purchase meets
statements. any relevant regulatory requirements and the target company aligns
Integrating and aligning any new acquisition with the Group poses various appropriately with the relevant Group values.
challenges from an operational and financial perspective.
• Prioritisation of identified growth opportunities to ensure resources
are appropriately allocated to opportunities with the best potential return on
investment.
People, Structure and Culture Employee relations claims / litigation / tribunals attributed to negative · Regular review and update of HR policies, to ensure behavioural -
behaviours or actions, increases the potential for reputational damage because expectations, standards of conduct, and employment practices for managers and
of negative publicity in the public domain. employees are clearly defined and consistently applied.
Braemar is a people-based business and people are vital to its success. · Ongoing development of an engaged and high-performance culture,
supported by structured performance objectives, defined career development
Loss of key staff or teams could result in reduced revenue. pathways, and succession planning for senior management and other critical
roles.
Inadequate policies and reward structures could incentivise negative
behaviours, create internal conflict, lead to reputational damage, and
· Regular review of structures within the business to ensure that they
contribute to failure in attracting and /or retaining skilled personnel. Strategic growth objectives may not be achieved if Braemar fails to attract remain well structured and competitive.
and retain valued employees.
· Annual review of compensation and reward structures, including external
market benchmarking, to help ensure remuneration remains appropriate,
Failure to adapt to, or align with, market expectations, including the competitive and supportive of attracting and retaining high-performing brokers
offering of flexible or hybrid working arrangements, could result in the and key team members.
inability to attract and retain skilled personnel.
Lack of appropriate consideration of environmental and wider social issues
could also contribute to the inability to attract and retain skilled
personnel.
Sanctions and trade restrictions Conducting business with sanctioned entities, through sanctioned regions and · KYC procedures performed by the Group Compliance teams with support -
facilitating transport of sanctioned goods will lead to non-compliance with from the Legal team and Braemar's global network of legal advisors.
sanctioned regimes resulting in financial penalties/fines and reputational
damage. · Through strategic and targeted recruitment, increasing our in-house KYC
Braemar operates in a global landscape of international and financial
and sanctions-monitoring capabilities enhances our ability to navigate the
sanctions with a variety of associated compliance requirements. intricate landscape of sanctions regulations and mitigate associated risks
within our business operations.
Note:
· Technology solutions used to optimise the efficiency of sanction
Increased scrutiny from regulatory bodies and rising geopolitical and screening performed.
macroeconomic issues, such as the conflict in Russia, Ukraine and the Middle
East, has increased the potential impact of risks associated with breaches of · External assurance providers performing internal audit reviews over the
sanctions and trade restriction requirements. sanctions process and validating the implementation of recommendations
previously raised to management.
· Targeted training program aimed at Management and senior desk heads to
further raise awareness of, and compliance with, all relevant legal and
regulatory obligations.
Going concern
The Group generated net cash from operating activities of £12.1 million in
the year, above the £5.9 million in the prior year. The business had a modest
net debt position at the end of the year of £2.9 million (FY25: £2.5 million
net debt), due to the timing of certain working capital items. The Group has
started the year in line with expectations although there remains significant
geopolitical uncertainty, however, the fundamentals of the business and
industry remain strong, and the directors believe that the Group is well
positioned to manage its risks going forward.
A more detailed analysis of the risks facing the business is outlined in Note
1 of the financial statements. The analysis concludes that there is no
material uncertainty relating to going concern, based on cash flow forecast
for a 15-month period from the signing of these accounts to 31 August 2027.
The directors have a reasonable expectation that the Company and Group have
adequate resources to continue to trade for at least twelve months from the
date of the approval of these Financial Statements and for this reason they
continue to adopt the going concern basis in preparing the Financial
Statements.
Viability statement
In accordance with the UK Corporate Governance Code, the directors have
assessed the prospects of the Group over a period of four years, which they
believe is an appropriate period based on the Group's current financial
position, banking facilities, budgets and forecasts, strategy, principal
risks, and exposure to potentially volatile market forces.
The Group's bankers, HSBC, remain highly supportive and the Group met all of
its financial covenant tests during the year and is confident that it will
continue to do so.
The facilities with HSBC expire in November 2027, and more detail can be found
in Note 1 to the financial statements. The viability assessment has been
carried out over a four-year period from the balance sheet date to 28 February
2030, by which time new banking facilities will need to have been concluded.
It therefore assumes that similar banking facilities will be made available to
the Group for the whole of this time. The directors' assessment considers
those current facility terms and includes a review of the financial impact of
significant adverse scenarios.
In generating those scenarios, consideration was also given to the following
risks to the business that have been identified in the FY26 Annual Report:
Competition risk and market consolidation
Competition in the shipping industry remains intense, and there is a growing
trend towards market consolidation, as companies seek to gain scale and reduce
costs. Loss of established brokers could impact revenues. Increasing
consolidation could impact the Group's M&A strategy for growth. Quarterly
horizon-scanning exercises are conducted by the leadership team to assess
emerging trends in the market and identify areas of the business that could be
targeted by competitors.
Cybercrime and data security
Cybercrime could result in loss of business assets or disruption to the
Group's IT systems and its business. Lack of appropriate data security could
result in loss of data. Loss of service and associated loss of revenue.
Reputational damage. Potential for material losses due to fraud or phishing.
To address the persistent threat of cyber-attacks, and to enhance security
measures already in place, Braemar has developed a Security & Resilience
Strategy with Board level approval. Implementing a robust set of risk controls
through adoption of the National Institute of Standards & Technology
(NIST) Cyber Security Framework and ISO 27001 Standard. Our Security
Operations Centre (SOC) supports the wider cyber security control environment,
providing 24x7 monitoring.
Geopolitical and macroeconomic
Braemar's businesses are reliant on global trade flows and as such may be
negatively impacted by geopolitical and/or macroeconomic issues. A downturn in
the world economy could affect transaction volumes, resulting in reduced
revenue. Changes in shipping rates and/or changes in the demand or pricing of
commodities could affect global supply activity. Political change, ongoing
conflicts, increased trade tensions and sanctions have heightened geopolitical
and macroeconomic risks.
Currency fluctuations
The Group is exposed to foreign exchange risk because a large proportion of
its revenue is generated in US dollars while its cost base is in multiple
currencies. The increase in risk is driven by heightened geopolitical
volatility.
People, Structure and Culture
Braemar is a people-based business and people are vital to its success.
Inadequate policies and reward structures could incentivise negative
behaviours, create internal conflict, lead to reputational damage, and
contribute to failure in attracting and /or retaining skilled personnel.
Revenue was chosen as the main variable in generating the adverse scenarios as
there are no costs of sale within the business and the remaining costs are
largely fixed or made up of bonus pools which will vary in line with the
levels of revenue. Set against those falls in revenue is the likely
effectiveness of potential mitigations that are reasonably believed to be
available to the Group over this period.
In considering these potential mitigations, the board was mindful of its
duties under Section 172 of the Companies Act 2006 and considered the
potentially competing interests of different stakeholder groups and the
potential long-term consequences of the actions, including the use of funds
for employee remuneration (and the role this plays in the retention of staff),
paying dividends, making investments and repaying debt.
The assessment involves the production of cash flow forecasts designed to
assess the ability of the Group to operate both within the banking facility
covenants and liquidity headroom. The main downside sensitivities used were
annual revenue reductions of 7.5% and 15% from May 2026 to July 2027 and
stabilised thereafter. Under the 7.5% cases the board concluded that with only
very minor cost-saving or cash management mitigations available to it, the
Group could continue to operate under the current banking facilities over the
period. Under the 15% case certain additional cost saving and cash mitigation
actions were required to allow the Group to continue to operate within the
current banking facilities, all of which were within the board's control.
The assessment also incorporated a "reverse stress test" which was designed to
identify scenarios under which the Group's banking facilities would be
inadequate to continue as a going concern despite using all the mitigating
options available. The result of this test shows that all available
mitigations would be exhausted, and facilities breached if there was
approximately a 31% decrease in forecast revenue from May 2026 through to July
2027.
The directors have concluded that whilst future outcomes cannot be guaranteed
or predicted with certainty the revenue and operating margin scenarios that
would lead to such a failure are highly unlikely. They also noted that the
facility headroom in terms of liquidity remained adequate even under the
reverse stress test conditions and that it was the leverage covenant which
would be breached if revenue fell by more than 31% and then only during 2027.
There is no evidence indicating that revenues will fall to levels indicated in
this test and that the likelihood is therefore remote and that there is
therefore no material uncertainty in this regard, nor any impact on the basis
of preparation of the Financial Statements. There is also a reasonable
expectation that the Group will be able to continue in operation and meet its
liabilities as they fall due over the next four financial years.
Consolidated Income Statement
For the year ended 28 February 2026
28 Feb 2026 28 Feb 2025
Notes Underlying £'000 Specific items Total Underlying £'000 Specific items Total
£'000
£'000
£'000
£'000
Revenue 2.1 135,614 - 135,614 141,860 - 141,860
Other operating income 2.2 - - - - 215 215
Operating expense:
Operating costs 2.3, 2.2 (121,355) (782) (122,137) (124,090) (928) (125,018)
Acquisition-related expenditure 2.2 (757) (3,952) (4,709) (1,134) (3,711) (4,845)
Impairment of financial assets 2.3,2.2 (1,079) - (1,079) (1,039) - (1,039)
Total operating expense (123,191) (4,734) (127,925) (126,263) (4,639) (130,902)
Operating profit/(loss) 12,423 (4,734) 7,689 15,597 (4,424) 11,173
Gain on disposal of associate 3.4 217 - 217 - - -
Finance income 2.5, 2.2 322 - 322 553 213 766
Finance costs 2.5, 2.2 (2,823) (774) (3,597) (2,717) - (2,717)
Profit/(loss) before tax 10,139 (5,508) 4,631 13,433 (4,211) 9,222
Taxation 2.7 (2,515) 161 (2,354) (3,593) 473 (3,120)
Profit/(loss) for the year 7,624 (5,347) 2,277 9,840 (3,738) 6,102
Profit/(loss) attributable to equity shareholders of the Company 7,624 (5,347) 2,277 9,840 (3,738) 6,102
Underlying Total Underlying Total
Earnings per ordinary share
Basic 2.8 24.23p 7.24p 31.30p 19.41p
Diluted 2.8 21.28p 6.36p 26.74p 16.58p
Consolidated Statement of Comprehensive Income
For the year ended 28 February 2026
Notes 28 Feb 2026 28 Feb 2025
£'000
£'000
Profit for the year 2,277 6,102
Other comprehensive income/(expense)
Items that will not be reclassified to profit or loss:
- Actuarial gain on employee benefit schemes - net of tax 5.1 780 1,025
Items that may be reclassified to profit or loss:
- Foreign exchange differences on retranslation of foreign operations 6.4 (1,255) 295
- Reclassification of foreign currency loss on strike off of foreign 58 -
operation
- Net investment hedge 6.4 263 (19)
- Cash flow hedges - net of tax 6.4 1,885 (1,201)
Other comprehensive income 1,731 100
Total comprehensive income attributable to owners of the parent 4,008 6,202
Consolidated Balance Sheet
As at 28 February 2026
Notes As at As at
28 Feb 2025
28 Feb 2026
£'000
£'000
Assets
Non-current assets
Goodwill 3.1 71,401 71,243
Other intangible assets 3.2 2,050 2,608
Property, plant and equipment 3.5, 3.6 8,823 10,135
Other investments 3.3 1,443 1,720
Investment in associate 3.4 - 713
Derivative financial instruments 4.4 - 205
Deferred tax assets 2.7 2,131 3,368
Pension surplus 5.1 3,508 2,548
Other long-term receivables 4.1 720 1,768
90,076 94,308
Current assets
Trade and other receivables 4.2 39,212 40,887
Derivative financial instruments 4.4 2,027 192
Current tax receivable 733 1,554
Cash and cash equivalents 4.5 23,363 20,477
65,335 63,110
Total assets 155,411 157,418
Liabilities
Current liabilities
Derivative financial instruments 4.4 51 592
Trade and other payables 4.3 37,329 34,732
Current tax payable 2.7 1,385 1,659
Provisions 7.1 525 2,433
Convertible loan notes 4.7 - 2,401
39,290 41,817
Non-current liabilities
Long-term liabilities 4.6 30,729 29,448
Deferred tax liabilities 2.7 188 358
Derivative financial instruments 4.4 - 116
Trade and other payables 4.3 1,798 498
Provisions 7.1 1,049 1,026
33,764 31,446
Total liabilities 73,054 73,263
Total assets less total liabilities 82,357 84,155
Equity
Share capital 6.1 3,307 3,292
ESOP reserve 6.3 (2,505) (4,334)
Other reserves 6.4 8,478 7,440
Retained earnings 73,077 77,757
Total equity 82,357 84,155
Registered number: 02286034
Consolidated Cash Flow Statement
For the year ended 28 February 2026
Notes 28 Feb 2026 28 Feb 2025
£'000
£'000
Profit before tax 4,631 9,222
Adjustment for:
Depreciation and amortisation charges 3.2, 3.5 4,120 3,812
Impairment of assets 3.5, 3.6 411 743
Share scheme charges 2.2 2,387 5,563
Loss on disposal of property, plant and equipment 3.5, 3.6 17 3
Net foreign exchange loss with no cash impact 108 232
Fair value gain on financial instruments charged to profit or loss 2.2 (394) (128)
Fair value gain on unlisted investments 3.3 (2) (87)
Net finance cost 2.2, 2.5 3,275 1,951
Gain on disposal of associate 3.4 (217) -
Operating cash flows not included in profit:
Cash settlement of share-based payment - (163)
Operating cash flow before changes in working capital 14,336 21,148
Decrease/(increase) in receivables 379 (2,153)
Increase /(decrease) in payables 3,630 (9,854)
(Decrease)/increase in provisions (1,846) 5
Cash flows from operating activities 16,499 9,146
Interest received 206 427
Interest paid (2,654) (2,610)
Tax paid (2,384) (3,028)
Tax received 444 2,006
Net cash generated from operating activities 12,111 5,941
Cash flows from investing activities
Purchase of property, plant and equipment 3.5 (1,398) (615)
Purchase of other intangible assets 3.2 (13) -
Proceeds related to disposal of Cory Brothers 4.9 1,695 1,666
Proceeds from disposal of investment in associate 3.4 929 -
Principal received on finance lease receivables 3.6 - 240
Net cash generated from investing activities 1,213 1,291
Cash flows from financing activities
Repayment of RCF loan facility (1,000) (4,000)
Proceeds from RCF loan facility 4,500 -
Repayment of principal under lease liabilities 3.6 (2,913) (3,106)
Cash proceeds on exercise of share awards settled by release of shares from - 514
ESOP
Dividends paid 6.2 (1,553) (5,497)
Purchase of own shares for cancellation 6.1 (2,022) -
Purchase of own shares 6.3 (4,141) (2,376)
Settlement of convertible loan notes 4.7 (2,559) (584)
Net cash used in financing activities (9,688) (15,049)
Increase/(decrease) in cash and cash equivalents 3,636 (7,817)
Cash and cash equivalents at beginning of the year 4.5 20,477 27,951
Foreign exchange differences (750) 343
Cash and cash equivalents at the end of the year 4.5 23,363 20,477
Consolidated Statement of Changes in Total Equity
For the year ended 28 February 2026
Notes Share ESOP reserve Other Retained (deficit)/ earnings Total
capital
£'000
reserves
£'000
equity
£'000
£'000
£'000
At 1 March 2024 3,292 (7,140) 8,365 75,104 79,621
Profit for the year - - - 6,102 6,102
Actuarial gain on employee benefits schemes - net of tax - - - 1,025 1,025
Foreign exchange differences - - 295 - 295
Net investment hedge - - (19) - (19)
Cash flow hedges - net of tax - - (1,201) - (1,201)
Other comprehensive income - - (925) 1,025 100
Total comprehensive income - - (925) 7,127 6,202
Tax on share awards 2.7 - - - 291 291
Dividends 6.2 - - - (5,497) (5,497)
Acquisition of own shares - (2,376) - - (2,376)
ESOP shares allocated 6.3 - 4,661 - (4,327) 334
Disposal of EBT shares 6.3 - 521 - (341) 180
Cash paid for share-based payments 6.3 - - - (163) (163)
Share-based payments 5.2 - - - 5,563 5,563
- 2,806 - (4,474) (1,668)
At 28 February 2025 3,292 (4,334) 7,440 77,757 84,155
Profit for the year - - - 2,277 2,277
Actuarial gain on employee benefits schemes - net of tax - - - 780 780
Foreign exchange differences - - (1,255) - (1,255)
Reclassification of foreign currency loss on strike off of foreign operation - - 58 - 58
Net investment hedge - - 263 - 263
Cash flow hedges - net of tax - - 1,885 - 1,885
Other comprehensive income - - 951 780 1,731
Total comprehensive income - - 951 3,057 4,008
Tax on share awards 2.7 - - - (477) (477)
Dividends 6.2 - - - (1,553) (1,553)
Share repurchase and cancellation 6.1 (87) - 87 (2,022) (2,022)
New shares issued 6.1 102 - - (102) -
Acquisition of own shares 6.3 - (4,141) - - (4,141)
ESOP shares allocated 6.3 - 5,970 - (5,970) -
Share-based payments 5.2 - - - 2,387 2,387
15 1,829 87 (7,737) (5,806)
At 28 February 2026 3,307 (2,505) 8,478 73,077 82,357
Notes to the Financial Statements
General information
Braemar plc (the "Company") is a public company limited by shares incorporated
in the United Kingdom under the Companies Act. The Company is registered in
England and Wales and its registered address is 1 Strand, Trafalgar Square,
London, United Kingdom, WC2N 5HR. The consolidated Financial Statements of the
Company as at and for the year ended 28 February 2026 comprise the Company and
its subsidiaries (together referred to as the "Group").
The Group Financial Statements of Braemar Plc for the year ended 28 February
2026 were authorised for issue in accordance with a resolution of the
directors on 20 May 2026.
1 Basis of preparation
1.1 Basis of preparation and forward-looking statements
The financial information set out above does not constitute the Group's
statutory accounts for the years ended 28 February 202 or 28 February 2025 but
is derived from those accounts. Statutory accounts for 2025 have been
delivered to the registrar of companies, and those for 2026 will be delivered
in due course. The auditor has reported on those accounts; their reports were
(i) unqualified; (ii) did not include a reference to any matters to which the
auditor drew attention by way of emphasis without qualifying their report; and
(iii) did not contain a statement under section 498 (2) or (3) of the
Companies Act 2006.
The financial information included in this preliminary announcement has been
prepared in accordance with UK-adopted international accounting standards and
with the requirements of the Companies Act 2006 as applicable to companies
reporting under those standards. The Group expects to distribute full accounts
that comply with UK-adopted international accounting standards and with the
requirements of the Companies Act 2006. The Financial Statements have been
prepared under the historic cost convention except for items measured at fair
value as set out in the accounting policies below.
Subsidiaries are entities that are controlled by the Group. Control exists
when the Group has the rights to variable returns from its involvement with an
entity and has the ability to affect those returns through its power over the
entity. The results of subsidiaries sold or acquired during the year are
included in the accounts up to, or from, the date that control exists. All
intercompany balances and transactions have been eliminated in full.
Certain statements in this Annual Report are forward-looking. Although the
Group believes that the expectations reflected in these forward-looking
statements are reasonable, it gives no assurance that these expectations will
prove to have been correct. These forward-looking statements involve risks and
uncertainties, so actual results may differ materially from those expressed or
implied by these forward-looking statements.
The Group Financial Statements are presented in sterling and all values are
rounded to the nearest thousand sterling (£'000) except where otherwise
indicated.
New standards, amendments and interpretations effective for the financial year
beginning 1 March 2025
The following amendments to IFRS Accounting Standards have been applied for
the first time by the Group:
- Amendments to IAS 21 "The Effects of Changes in Foreign Exchange
Rates" titled Lack of Exchangeability
The adoption of the above has not had any material impact on the amounts
reported or the disclosures in these Financial Statements.
New standards, amendments and interpretations issued but not yet effective for
the financial year beginning 1 March 2025 and not early adopted
There are a number of standards, amendments to standards, and interpretations
which have been issued by the IASB that are effective in future accounting
periods that the Group has decided not to adopt early.
The following standards or amendments are effective in future periods and have
not been early adopted by the Group:
- Annual Improvements 2024 to IFRS Accounting Standards
- Amendments to IFRS 9 and IFRS 7 "Contracts Referencing
Nature-dependent Electricity"
- Amendments to IFRS 9 and IFRS 7 "Amendments to the Classification
and Measurement of Financial Instruments"
- Amendments to IAS 21 "The Effects of Changes in Foreign Exchange
Rates: Translation to a Hyperinflationary Presentation Currency"
- IFRS 18 "Presentation and Disclosures in Financial Statements"
- IFRS 19 "Subsidiaries without Public Accountability: Disclosures"
- Amendments to IFRS 19 "Subsidiaries without Public Accountability:
Disclosures"
IFRS 18 introduces new requirements to:
· present specified categories and defined subtotals in the
statement of profit or loss
· provide disclosures on management-defined performance measures
("MPMs") in the notes to the financial statements
· improve aggregation and disaggregation.
Except for IFRS 18, the adoption of these standards and amendments is not
expected to have a material impact on the Financial Statements of the Group in
future periods. Management is currently in the process of assessing the
detailed implications of applying IFRS 18 to the Group's Consolidated
Financial Statements. Although this process is ongoing, the following changes
are expected:
- Additional totals or sub-totals will be required in the Income
Statement,
- The Income Statement line items which foreign exchange gains and
losses and derivative gains or losses are included might change,
- Additional new disclosures in relation to management-defined
performance measures are required, and
- Changes to the presentation of the cash flow statement in relation
to interest paid, which will be included within the financing category and
interest received which will be included within the investing category.
1.2 Going concern
The Group Financial Statements have been prepared on a going concern basis. In
reaching this conclusion regarding the going concern assumption, the directors
considered cash flow forecasts to 31 August 2027 which is more than twelve
months from the date of signing of these Financial Statements.
A set of cash flow forecasts ("the base case") have been prepared by
management to cover the going concern period and reviewed by the directors
based on revenue and cost forecasts considered reasonable in the light of work
done on budgets for the current year and the current shipping markets. In
putting together these forecasts, particular attention was paid to the
following factors:
· Expected market demand, the impact on market rates and the
Group's forward order book.
· The Group's compliance with sanctions put in place as a result of
the conflicts in Ukraine and the Middle East has meant additional work
reviewing compliance obligations on a regular basis as the laws have been
amended but did not have a material effect on trading in FY26, nor is it
expected to have an impact in FY27.
· The level of likely cost inflation, particularly around salaries.
· Adverse movement in foreign exchange rates, particularly USD that
can have an impact on revenues. The Group has a hedging programme in place to
partially mitigate this impact.
· The impact that a prolonged Middle East conflict and closure of
the Strait of Hormuz could have on performance.
· Geopolitical tensions can cause volatility in shipping markets,
but, if anything, that uncertainty can give rise to additional opportunities
for the business to support the industry and clients further. There is
therefore no expectation that the current global political tensions will have
an adverse impact on trading in FY27.
· The impact of climate change is not expected to have any material
impact on the business in the short term and indeed could lead to additional
opportunities.
The directors have considered trading performance during the current year and
have concluded that none of these factors are currently likely to have a
significantly adverse impact on the Group's future cash flows.
At 28 February 2026, the Group had net debt of £2.9 million (2025: £2.5
million net debt). As at 30 April 2026, the Group had net cash of £6.8
million.
Notes 30 April 2026 28 Feb 2026 28 Feb 2025
£m
£m
£m
Secured revolving credit facilities 4.6 (23.3) (26.3) (22.9)
Cash 4.5 30.3 23.4 20.4
Net cash/(debt) 7.0 (2.9) (2.5)
The Group's revolving credit facility ("RCF") is for £40.0 million which has
increased by £10 million following approval of the accordion facility of
£10.0 million. In the prior year, the Group exercised an option to extend the
facility by two years which was approved by the lender, extending the term to
November 2027. The RCF agreement has an EBITDA leverage covenant of 2.5x and a
minimum interest cover of 4x. At 31 May 2025, 31 August 2025, 30 November 2025
and 28 February 2026, the Group met all financial covenant tests. In addition,
there is a further requirement to provide HSBC with the Group's audited
financial statements within six months of the year-end.
The cash flow forecasts in the base case assessed the ability of the Group to
operate both within the banking covenants and the facility headroom, including
a number of downside sensitivities on budgeted revenue, including a reverse
stress test scenario. The directors consider revenue as the key assumption in
the Group's budget. The cost base is largely fixed or made up of discretionary
bonuses, which are directly linked to profitability. Based on two flex
scenarios; a revenue decrease of 7.5% and a revenue decrease of 15% from the
base case, only very minor mitigations were necessary to meet banking
covenants.
A reverse stress test was also performed to ascertain the point at which the
covenants would be breached in respect of the key assumption of budgeted
revenue decline. This test indicated that the business, alongside certain
mitigating actions which are fully in control of the directors, would be
capable of withstanding a reduction of approximately 31% in budgeted revenue
from the base case assumptions from May 2026 through to July 2027. In light of
current trading, forecasts and the Group's performance over FY26, the
directors assessed this downturn in revenue and concluded the likelihood of
such a reduction remote, especially in the light of the forward order book of
$72.5 million at the end of February 2026 ($37.6 million of which is for the
financial year ending February 2027), such that it does not impact the basis
of preparation of the Financial Statements and there is no material
uncertainty in this regard.
1.3 Use of estimates and critical judgements
The preparation of the Group's Financial Statements requires management to
make judgements, estimates and assumptions that affect the reported amounts of
revenues, expenses, assets and liabilities, and the disclosure of contingent
liabilities, at the reporting date. Estimates and judgements are continually
evaluated based on historical experience and other factors, including
expectations of future events that are believed to be reasonable under the
circumstances. In the future, actual experience may differ from these
estimates and assumptions. Key estimates are those that the Group has made in
the process of applying the Group's accounting policies and that have a
significant risk of resulting in material adjustments to the carrying amounts
of assets and liabilities within the next financial year. Critical judgements
are those that the Group makes, apart from those involving estimations, that
the directors have made in the process of applying the Group's accounting
policies and that have the most significant effect on the amounts recognised
in the Financial Statements.
The following table provides a summary of the Group's key estimates and
critical judgements, along with the location of more detailed information
relating to those judgements.
Judgement applied to Judgements excluding estimates Estimates Location of further information
Revenue recognition Yes Note 2 - Revenue recognition
Classification and recognition of specific items Yes Note 2.2 - Specific items
Impairment of goodwill Yes Note 3.1 - Goodwill
Lease term Yes Note 3.6 - Leases
Provision for impairment of trade receivables and contract assets Yes Note 4.2 - Trade and other receivables
Recoverability and valuation of defined benefit pension scheme Yes Yes Note 5.1 - Long-term employee benefits
Share option vesting Yes Note 5.2 - Share-based payments
Climate‐related risks and opportunities
Management has considered the impact of climate-related risks in respect of
impairment of goodwill, recoverability of receivables and the recoverability
of deferred tax assets in particular and does not consider that
climate‐related risks have a material impact on any key judgements,
estimates or assumptions in the consolidated Financial Statements.
Climate change was assessed as part of ongoing discussions of key and emerging
risks for the Group and the shipping and energy sectors within which it
operates. Consideration of the potential short to medium-term impact of the
Environment and Climate Change risk resulted in its inclusion as a Group
Principal Risk.
1.4 Material accounting policies
The accounting policies applied by the Group in relation to specific
transactions and balances are disclosed in the note to which they relate. The
following section includes those accounting policies which apply pervasively
across the Financial Statements and to avoid repetition are disclosed in this
note.
a) Business combinations
The acquisition method of accounting is used to account for all business
combinations, regardless of whether equity instruments or other assets are
acquired. The consideration transferred for the acquisition of a subsidiary
comprises the:
- fair values of the assets acquired;
- liabilities incurred to the former owners of the acquired
business;
- equity interests issued by the Group;
- fair value of any asset or liability resulting from a contingent
consideration arrangement; and
- fair value of any pre-existing equity interest in the subsidiary.
Identifiable assets acquired and liabilities and contingent liabilities
assumed in a business combination are, with limited exceptions, measured
initially at their fair values at the acquisition date. The Group recognises
any non-controlling interest in the acquired entity on an
acquisition-by-acquisition basis either at fair value or at the
non-controlling interest's proportionate share of the acquired entity's net
identifiable assets.
Acquisition-related costs are expensed as incurred.
The excess of the consideration transferred, amount of any non-controlling
interest in the acquired entity, and acquisition-date fair value of any
previous equity interest in the acquired entity over the fair value of the net
identifiable assets acquired is recorded as goodwill. If those amounts are
less than the fair value of the net identifiable assets of the business
acquired, the difference is recognised directly in profit or loss as a gain on
purchase.
Where settlement of any part of cash consideration is deferred, the amounts
payable in the future are discounted to their present value as at the date of
exchange. The discount rate used is the entity's incremental borrowing rate,
being the rate at which a similar borrowing could be obtained from an
independent financier under comparable terms and conditions.
Contingent consideration is classified either as equity or a financial
liability. Amounts classified as a financial liability are subsequently
remeasured to fair value, with changes in fair value recognised in profit or
loss.
If the business combination is achieved in stages, the acquisition date
carrying value of the acquirer's previously held equity interest in the
acquiree is remeasured to fair value at the acquisition date. Any gains or
losses arising from such remeasurement are recognised in profit or loss.
Due to the nature of the Group's business, amounts paid or shares issued to
sellers are often linked to their continued employment. An assessment is
performed to determine whether the amounts are part of the exchange for the
acquiree, or should be treated as a transaction separate from the business
combination. Transactions that are separate from the business combination are
accounted for in accordance with the relevant IFRSs which generally results in
the amounts being treated as a post-combination remuneration expense.
b) Foreign currencies
Transactions and balances
Transactions in currencies other than sterling are recorded at the rates of
exchange prevailing on the date of the transaction. Foreign exchange gains
and losses resulting from the settlement of such transactions and from the
translation at year-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in the Income Statement.
In order to hedge its exposure to certain foreign exchange risks, the Group
enters into derivative financial instrument contracts, mainly forward foreign
currency exchange contracts which are designated as cash flow hedges (see Note
4.4). For a qualifying hedge relationship, the fair value gain or loss on the
hedging instrument is recognised as part of revenue when the underlying
transaction is recognised in accordance with the Group's revenue recognition
policy.
Translation to presentation currency
The presentational currency of the Group is sterling. Assets and liabilities
of overseas subsidiaries, branches and associates are translated from their
functional currency into sterling at the exchange rates ruling at the Balance
Sheet date. Trading results are translated at the average rates for the
period. Exchange differences arising on the consolidation of the net assets of
overseas subsidiaries are recognised through other comprehensive income
("OCI") in the foreign currency translation reserve (see Note 6.4).
On disposal of a business, the cumulative exchange differences previously
recognised in the foreign currency translation reserve relating to that
business are transferred to the Income Statement as part of the gain or loss
on disposal. The Group finances overseas investments partly through the use of
foreign currency borrowings in order to provide a net investment hedge over
the foreign currency risk that arises on translation of its foreign currency
subsidiaries. For effective hedge relationships, the gain or loss on the
hedging instrument is recognised in equity through other comprehensive income.
c) Impairment
The carrying amount of the Group's assets, other than financial assets within
the scope of IFRS 9 and deferred tax assets, are reviewed for impairment as
described below. If any indication of impairment exists, the asset's
recoverable amount is estimated. The recoverable amount is determined based on
the higher of value-in-use calculations and fair value less costs to sell,
which requires the use of estimates. An impairment loss is recognised in the
Income Statement whenever the carrying amount of the assets exceeds its
recoverable amount.
Goodwill is reviewed for impairment at least annually. Impairments are
recognised immediately in the Income Statement. Goodwill is allocated to
cash-generating units for the purposes of impairment testing.
The carrying value of intangible assets with a finite life is reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying value may not be recoverable. The carrying values of other
intangible assets are reviewed for impairment at least annually or when there
is an indication that they may be impaired.
Right-of-use assets are reviewed for impairment to account for any loss when
events or changes in circumstances indicate the carrying value may not be
fully recoverable.
Where there is objective evidence that the investment in an associate has been
impaired, the carrying amount of the investment is tested for impairment in
the same way as other non-financial assets.
Where an impairment loss subsequently reverses, the carrying amount of the
assets, with the exception of goodwill, is increased to the revised estimate
of its recoverable amount. This cannot exceed the carrying amount prior to the
impairment charge. An impairment recognised in the Income Statement in respect
of goodwill is not subsequently reversed.
d) Contingent assets
Contingent assets are not recognised but are disclosed where an inflow of
economic benefits is probable.
e) Joint arrangements
The Group has a 50% interest in its joint operation with GFI, an operating
division within BGC Group Inc. , which conducts wet freight derivative
broking, operating from the Company's registered address, 1 Strand, Trafalgar
Square, London, United Kingdom, WC2N 5H. The Group recognises its share of
revenues and costs in the respective Income Statement line items as reported
by the Group.
2 Performance-related information
Revenue recognition
Key judgement
Revenue recognition
IFRS 15 "Revenue from Contracts with Customers" requires judgement to
determine whether revenue is recognised at a "point in time" or "over time"
as well as determining the transfer of control for when performance
obligations are satisfied.
For Chartering, in relation to single voyages, the Group has defined the
performance obligation to be satisfied at the point in time where the
negotiated contract between counterparties has been successfully completed,
being the discharge of cargoes, and therefore revenue is recognised at this
point in time. This is a critical judgement since revenue recognition would
differ if the performance obligations were deemed to be satisfied over a time
period, or at a different point in time. For time charters, the performance
obligation is to provide operational support and act on behalf of the
principal over the course of hire. As a result, the Group believes the
performance obligation is satisfied over the period of hire and revenue is
recognised accordingly.
Revenue is recognised in accordance with satisfaction of performance
obligations. Revenue of the Group consists of:
i) Chartering desks - The Group acts as a broker for several types
of shipping transactions, each of which gives rise to an entitlement to
commission:
Deep Sea Tankers, Specialised Tankers and Gas, Dry Cargo and Offshore:
- for single voyage chartering, the contractual terms are governed by a
standard charterparty contract in which the broker's performance obligation is
satisfied when the cargo has been discharged according to the contractual
terms; and
- for time charters, the commission is specified in the hire agreement
and the performance obligation is spread over the term of the charter at
specified intervals in accordance with the charter party terms.
ii) Risk Advisory desks
Securities:
- for income derived from commodity broking, the commission is
recognised when a binding contractual arrangement is entered into between the
two parties, at which point, the Group has fulfilled its performance
obligation.
iii) Investment Advisory
Financial:
- income comprises retainer fees and success fees generated by corporate
finance-related activities. Revenue is recognised in accordance with the terms
agreed in individual client terms of engagement. Recurring monthly retainers
allow customers to benefit from services when required, and as such, are
generally recognised in the month of invoice. Success fees are recognised at
the point when the performance obligations of the particular engagement are
fulfilled.
Sale and Purchase:
- in the case of second-hand sale and purchase contracts, the broker's
performance obligation is satisfied when the principals in the transaction
complete on the sale/purchase and the title of the vessel passes from the
seller to the buyer;
- with regard to newbuilding contracts, the commission is recognised
when contractual stage payments are made by the purchaser of a vessel to a
shipyard which in turn reflects the performance of services over the life of
the contract; and
- for income derived from providing ship and fleet valuations, the Group
recognises income when a valuation certificate is provided to the client and
the service is invoiced.
Dividend income from investments is recognised when the right to receive
payment is established.
2.1 Business segments
Based on the way in which information is presented to the Group's Chief
Operating Decision Maker, the Group's operating segments are Chartering,
Investment Advisory and Risk Advisory. The Chief Operating Decision Maker is
considered to be the Group's board of directors. These three segments are
managed separately on the basis of the nature of the services offered to
clients and differences in the regulatory environment applicable to each
segment.
The table below shows the make-up of the Group's segments by underlying
component.
Segment Component
Chartering Deep Sea Tankers
Specialised Tankers
Offshore
Dry Cargo
Investment Advisory Corporate Finance
Sale and Purchase
Risk Advisory Securities
Each of Chartering, Investment Advisory and Risk Advisory are managed
separately, and the nature of the services offered to clients is distinct
between the segments. The Chartering segment includes the Group's shipbroking
business, Risk Advisory includes the Group's regulated securities business and
Investment Advisory focuses on transactional services.
The segmental analysis is consistent with the way the Group manages itself and
with the format of the Group's internal financial reporting. The board
considers the business from both service line and geographic perspectives. A
description of each of the lines of service is provided in the Operating and
Financial Reviews. The Group's main geographic markets comprise the UK,
Singapore, the US, Australia, Switzerland, Germany and the Rest of the World.
The Group's geographical markets are determined by the location of the Group's
assets and operations.
Central costs relate to board costs and other costs associated with the
Group's listing on the London Stock Exchange. All segments meet the
quantitative thresholds required by IFRS 8 as reportable segments.
Underlying operating profit is defined as operating profit for continuing
activities before specific items, including restructuring costs, gain/loss on
disposal of investments and acquisition and disposal-related items.
The segmental information provided to the board for reportable segments for
the year ended 28 February 2026 is as follows:
Revenue Operating profit
2026 2025 2026 2025
£'000
£'000
£'000
£'000
Chartering 74,713 89,352 8,344 11,552
Investment Advisory 32,126 30,167 6,332 6,107
Risk Advisory 28,775 22,341 4,929 3,493
Trading segments revenue/results 135,614 141,860 19,605 21,152
Central costs (7,182) (5,555)
Underlying operating profit 12,423 15,597
Specific items included in operating profit (4,734) (4,424)
Operating profit 7,689 11,173
Gain on disposal of associate 217 -
Net finance expense (3,275) (1,951)
Profit before taxation 4,631 9,222
Geographical segment - by origin of invoice
The Group manages its business segments on a global basis. The operation's
main geographical area and also the home country of the Company is the United
Kingdom.
Geographical information determined by origin of invoice is set out below:
Revenue
2026 2025
£'000
£'000
United Kingdom 80,351 77,294
Singapore 15,597 18,404
Australia 9,383 10,220
Switzerland 1,288 1,781
United States 18,649 19,441
Germany 1,540 1,646
Rest of the World 8,806 13,074
Total 135,614 141,860
Revenue analysis
The Group disaggregates revenue in line with the segmental information
presented above and also by desk. Revenue analysed by desk is provided below.
2026 2025
£'000
£'000
Tankers 33,358 42,928
Specialised Tankers 14,854 16,487
Dry Cargo 17,581 20,954
Offshore 8,920 8,983
Chartering total 74,713 89,352
Sales and Purchase 30,459 27,895
Corporate Finance 1,667 2,272
Investment Advisory total 32,126 30,167
Securities 28,775 22,341
Risk Advisory total 28,775 22,341
Total continuing operations 135,614 141,860
All revenue arises from the rendering of services. There is no single customer
that contributes greater than 10% of the Group's revenue.
Remaining performance obligations
The Group enters into some contracts which are for a duration longer than
twelve months and where the Group has outstanding performance obligations on
which revenue has not yet been recognised at the Balance Sheet date. The
amount of revenue that will be recognised in future periods on these contracts
when those remaining performance obligations are satisfied is set out below:
Forward order book
2026 Within 1-2 years £'000 More than2 years Total
12 months
£'000
£'000
£'000
Chartering 16,004 3,691 4,421 24,116
Sale and Purchase 11,884 10,413 7,399 29,696
Total 27,888 14,104 11,820 53,812
2025 Within 1-2 years More than Total
12 months
£'000
2 years
£'000
£'000
£'000
Chartering 17,869 6,012 6,954 30,835
Sale and Purchase 13,292 10,875 10,297 34,464
Total 31,161 16,887 17,251 65,299
2.2 Specific items
Specific items are significant items considered material in size or nature
(including acquisition and disposal-related gains and losses) as well as items
which are not considered to be part of the trading performance of the business
in the current year. These are disclosed separately to enable a full
understanding of the Group's ongoing financial performance, but may not be
comparable with disclosures provided by other companies. The Group's adjusted
performance measures are reviewed by the Group's Chief Operating Decision
Maker and are used as the basis to determine the discretionary bonus pools and
measure earnings per share performance related to targets for awards under the
Group's Long Term Incentive Plan.
Key judgement
Classification and recognition of specific items
In reporting financial information, the Group presents Alternative Performance
Measures ("APMs") which are not defined or specified under the requirements of
International Financial Reporting Standards ("IFRS"). The Group believes that
these APMs, which are not considered to be a substitute for or superior to
IFRS measures, provide stakeholders with additional helpful information and
enable an alternative comparison of performance over time.
The Group excludes specific items from its underlying earnings measures.
Management judgement is required as to which items qualify for this
classification. There can also be judgement required as to the point at which
costs should be recognised and the amount to record to ensure that the
understanding of the underlying performance is not distorted. Further details
of the Group's specific items are included in the note below.
2026 2025
£'000
£'000
Other operating income:
- Gain on investment measured at fair value through profit or loss - 87
- Gain on revaluation of Cory contingent consideration receivable - 128
- 215
Operating costs:
- Impairment of ROU asset (401) (743)
- Investigation costs (381) (185)
(782) (928)
Acquisition-related items:
- Consideration treated as an employment expense (2,855) (3,580)
- Madrid post-contractual obligation (110) 281
- Corporate transaction costs (689) -
- Amortisation of acquired intangible assets (298) (412)
(3,952) (3,711)
Other items:
- Finance income - foreign exchange and derivative gain on Naves liability - 213
- Finance costs - foreign exchange and derivative gain on Naves liability (111) -
- Finance costs - hedge ineffectiveness (663) -
(774) 213
Total (5,508) (4,211)
Other operating income
In the prior year, other operating income includes the fair value gain of
£0.1 million on the revaluation of the Group's investment in London Tanker
Brokers' Panel. Consistent with the previous fair value movements being
included as a specific item, the Group has treated the gain as a specific item
as it does not relate to the trading performance of the business.
Revaluation of the contingent receivable due in respect of the Cory Brothers
disposal resulted in a gain of £0.1 million. See Note 4.9 for further
details.
The tax charge on specific items included within other operating income was
£nil (2025: £nil).
Operating costs
Impairment of ROU asset
The Group had previously sublet a segregated portion of its office space, but
does not expect to be able to sublet the office space for the full period of
the head lease. As a result, the Group prepared a value-in-use calculation to
determine the recoverable amount and recognised an impairment charge in
relation to the portion of the right-of-use asset relating to the unused
office space which is included in central costs. As this cost does not relate
to the performance of the business, it is treated as a specific item.
Investigation costs
During the preparation of the 2023 Annual Report, the board instigated an
investigation into a transaction which originated in 2013 and involved
payments being made through to 2017. The investigation engaged multiple
external specialist firms and resulted in a significant cost to the business
of £2.6 million in the year to 29 February 2024. Smaller residual amounts of
£0.4 million in relation to ongoing legal support have been incurred in the
current year. The total cost incurred to date is £3.2 million.
The tax income on specific items included within operating costs was £0.3
million (2025: £0.2 million).
Acquisition-related items
Consideration treated as an employment expense
Following the acquisition of Southport Maritime Inc. in December 2022, due to
the requirement for ongoing employee service, the upfront cash payment of
£6.0 million and IFRS 2 charge related to share awards made to the sellers
and existing employees of Southport are treated as a post-combination
remuneration expense. The total expense for the year related to amounts linked
to ongoing employee service in connection with the acquisition of Southport
was £2.9 million (2025: £3.6 million). The period of required employee
service is three years from the acquisition date.
Madrid post-contractual obligation
As a result of the recruitment of a team of brokers based in Madrid, service
agreements were entered into with employees. Certain brokers are entitled to a
payment on termination in return for a non-compete obligation. The cost
related to the post-contractual payment obligation is treated as a specific
item because there is no requirement to provide service. The Group recognised
a cost of £0.1 million during the year in relation to this obligation (2025:
£0.3 million gain).
Corporate transaction costs
During the year, the Group incurred costs of £0.7 million primarily in
relation to professional advisor fees relating to the ongoing review of
potential acquisition targets and the loss on strike off of certain subsidiary
undertakings.
Amortisation of acquired intangible assets
An amount of £0.3 million (2025: £0.4 million) relates to the amortisation
of acquired intangible assets, primarily in relation to intangible assets
recognised as a result of the acquisition of Southport Inc. in FY23.
The tax income on acquisition-related items was £0.1 million (2025: £0.1
million). The tax effect of expenses not deductible for tax was £0.7 million
(2025: £0.8 million).
Other items
Foreign exchange and derivative movement on Naves liability
The foreign exchange loss on the Naves-related liabilities and derivative of
£0.1 million (2025: £0.2 million gain) is included as a specific item as it
relates to the acquisition of Naves and is not related to trading. During the
year, the final tranche of convertible loan notes was settled, and as such,
there will be no further specific item related to the Naves liability from
FY27 onwards.
Hedge ineffectiveness
During the year, one of the Group's counterparties to its forward foreign
exchange contracts was placed into administration. From the date that the
Group determined there to be a significant increase in credit risk, such that
it dominated the fair value changes of the derivatives, the Group discontinued
hedge accounting. The net fair value loss on outstanding derivative contracts
with this counterparty from this date is presented as a specific item as hedge
accounting is not permitted under IFRS 9 and the Group does not consider the
loss to be reflective of the Group's underlying hedging strategy and business
performance.
The tax charge on specific items included within other items was £0.2 million
(2025: £0.2 million credit). The tax effect of income not taxable was £0.4
million (2025: £0.2 million).
2.3 Operating profit
Operating profit represents the results from operations before finance income
and costs, share of profit/(loss) in associate and taxation.
This is stated after charging/(crediting):
Notes 2026 2025
£'000
£'000
Staff costs 2.4 100,046 102,877
Depreciation of property, plant and equipment 3.5 3,721 3,227
Amortisation of computer software intangible assets 3.2 101 173
Impairment of financial assets 4.2 1,079 1,039
Auditor's remuneration 2.6 1,160 1,354
Other professional costs 4,437 3,860
Office costs 2,810 2,166
IT and communication costs 4,129 4,411
Insurance 1,013 1,463
Net foreign exchange losses 302 857
2.4 Staff costs
a) Staff costs for the Group during the year (including directors)
Notes 2026 2025
£'000
£'000
Salaries, wages and short-term employee benefits 88,279 88,909
Other pension costs 5.1 2,048 1,967
Social security costs 7,332 6,438
Share-based payments 5.2 2,387 5,563
Total 100,046 102,877
The numbers above include remuneration and pension entitlements for each
director.
b) Average number of employees
2026 2025
number
number
Chartering 232 248
Risk Advisory 30 33
Investment Advisory 56 55
Central 70 75
Total 388 411
c) Key management compensation
The remuneration of key management, which the Group considers to be the
directors, is set out below.
2026 2025
£'000
£'000
Salaries, short-term employee benefits and fees 2,986 1,187
Other pension costs 12 59
Termination benefits 400 -
Share-based payments 188 349
Total 3,586 1,595
Pension costs relate to contributions made to a defined contribution pension
scheme on behalf of one (2025: two) members of key management.
2.5 Finance income and costs
The tables below provide a breakdown of the key components of finance income
and finance costs.
Note 2026 2025
£'000
£'000
Finance income:
- Interest on bank deposits 4.5 111 358
- Interest on lease receivables 3.6 - 1
- Interest on Cory earnout deferred consideration receivable 4.4 31 39
Interest income applying the effective interest method 142 398
- Interest income on the net defined benefit asset 5.1 180 109
- Foreign exchange gain on non-GBP denominated credit facilities 4.6 - 46
- Gain on Naves related derivative instruments and liability 4.7 - 213
Total finance income 322 766
Finance costs:
- Interest payable on revolving credit and overdraft facilities 4.6 (2,179) (2,240)
- Interest on lease liabilities 3.6 (474) (276)
- Interest payable on convertible loan notes 4.7 (93) (201)
Interest expense applying the effective interest method (2,746) (2,717)
- Loss on derivative instruments not eligible for hedge accounting (663) -
- Foreign exchange loss on non-GBP denominated credit facilities (77) -
- Loss on Naves related derivative instruments and liability (111) -
Total finance costs (3,597) (2,717)
Finance costs - net (3,275) (1,951)
2.6 Auditor's remuneration
A more detailed analysis of the auditor's services is provided below:
2026 2025
£'000
£'000
Audit services:
- Fees payable to the Company's auditor for the audit of the Company's 652 702
Financial Statements
Fees payable to the Group's auditor and its associates for other services:
- The audit of the Group's subsidiaries pursuant to legislation 363 521
- Other services - interim review and reporting accountant services 145 131
1,160 1,354
All fees paid to the auditor were charged to operating profit in both years.
2.7 Taxation
The taxation expense represents the sum of the current and deferred tax.
Tax currently payable is based on taxable profit for the year. Taxable profit
differs from profit as reported in the Income Statement because it excludes
items of income and expense that are taxable or deductible in other years and
it further excludes items that are never taxable or deductible. The Group and
Company's liability for current tax is calculated using rates that have been
enacted or substantively enacted by the Balance Sheet date.
Deferred income 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. However,
deferred tax liabilities are not recognised if they arise from the initial
recognition of goodwill. Deferred income tax is also not accounted for if it
arises from the 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 or loss and does not give rise
to equal taxable and deductible temporary differences. Deferred income tax is
determined using tax rates (and laws) that have been enacted or substantively
enacted by the end of the reporting period and are expected to apply when the
related deferred income tax asset is realised, or the deferred income tax
liability is settled. Deferred tax assets and liabilities are offset where
there is a legally enforceable right to offset current tax assets and
liabilities and where the deferred tax balances relate to the same taxation
authority. Current tax assets and tax liabilities are offset where the entity
has a legally enforceable right to offset and intends either to settle on a
net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax are recognised in the Income Statement, except to the
extent that it relates to items recognised in other comprehensive income or
directly in equity. In this case, the tax is also recognised in other
comprehensive income or directly in equity, respectively.
a) Analysis of charge in year
2026 2025
£'000
£'000
Current tax
UK corporation tax charged to the Income Statement 830 831
UK adjustment in respect of previous years (290) (6)
Overseas tax on profits in the year 2,210 1,810
Overseas adjustment in respect of previous years (227) 33
Total current tax 2,523 2,668
Deferred tax
UK current year origination and reversal of temporary differences 385 269
UK adjustment in respect of previous years 2 -
Overseas current year origination and reversal of temporary differences (556) 183
Overseas adjustment in respect of previous years - -
Total deferred tax (169) 452
Taxation 2,354 3,120
Reconciliation between expected and actual tax charge 2026 2025
£'000
£'000
Profit before tax from continuing operations 4,631 9,222
Profit before tax at standard rate of UK corporation tax of 25% (2025: 25%) 1,158 2,305
Tangible fixed assets 58 -
Net expenses not deductible for tax purposes 1,757 1,649
Utilisation of previously unrecognised losses (27) (33)
(Losses)/profit on overseas branch (112) (241)
Tax calculated at domestic rates applicable to profits in overseas (604) (696)
subsidiaries
Share scheme movements 555 98
Unrecognised deferred tax on losses(1) 82 11
Prior year adjustments (513) 27
Total tax charge for the year 2,354 3,120
(1) The Group has £0.3 million of unrecognised deferred tax asset relating to
£1.1 million of losses. The expiry date of operating losses carried forward
is dependent upon the law of the various territories in which losses arise. As
at 28 February 2026, the losses have no expiry.
Included within the total tax charge is £0.2 million credit (2025: £0.5
million) in respect of specific items disclosed separately on the face of the
Income Statement. See Note 2.2.
The Group's future tax charge will be sensitive to the geographic mix of
profits earned, the tax rates in force and changes to the tax rules in
jurisdictions that the Group operates in.
b) Amounts recognised in OCI
2026 2025
£'000
£'000
Items that will not be reclassified to profit or loss
Actuarial gain in respect of defined benefit pension scheme 780 1,025
Sub-total 780 1,025
Items that will be reclassified to profit or loss
Cash flow hedge 2,535 (1,601)
Deferred tax charge on cash flow hedge (650) 400
Sub-total 1,885 (1,201)
Total amounts recognised in OCI 2,665 (176)
Within the UK current year origination and reversal of temporary differences,
there is no amount (2025: £nil) in respect of deferred tax on the actuarial
gain on the Group's defined benefit pension scheme.
c) Deferred tax asset
Deferred tax asset
Accelerated capital allowances Trading losses Other provisions Employee benefits
£'000 £'000 Bonuses £'000 £'000 Total
£'000 £'000
At 1 March 2024 86 215 855 120 1,703 2,979
(Charge)/credit to Income Statement (42) 108 (122) 148 (194) (102)
(Charge)/credit to other comprehensive income - - - 400 - 400
(Charge)/credit to equity - - - - 133 133
Exchange translation differences - (10) (15) (17) - (42)
At 28 February 2025 44 313 718 651 1,642 3,368
(Charge)/credit to Income Statement (309) 208 335 30 (239) 25
(Charge)/credit to other comprehensive income - - - (650) - (650)
(Charge)/credit to equity - - - - (519) (519)
Exchange translation differences - (16) (45) (32) - (93)
At 28 February 2026 (265) 505 1,008 (1) 884 2,131
d) Deferred tax liability
Analysis of the deferred tax liability As at As at
28 Feb 2026 28 Feb 2025
£'000 £'000
Temporary differences (188) (358)
Balance at end of year (188) (358)
The movement in the deferred tax liability As at As at
28 Feb 2026 28 Feb 2025
£'000 £'000
Balance at beginning of year (358) (8)
Current year origination and reversal of temporary differences 144 (350)
Exchange differences 26 -
Balance at end of year (188) (358)
e) The movement in the net deferred tax asset
2026 2025
£'000
£'000
Balance at beginning of year 3,010 2,971
Movement to Income Statement:
Adjustments in respect of prior years 2 -
Arising on bonuses 529 (535)
Arising on other (123) 83
Arising on employee benefits (239) -
Total movement to Income Statement 169 (452)
Movement to other comprehensive income:
Related deferred tax asset (650) 400
Exchange translation differences (67) (42)
Movement to equity (519) 133
Total movement to equity and other comprehensive income (1,236) 491
Balance at end of year 1,943 3,010
A deferred net tax asset of £1.9 million (2025: £3.0 million) has been
recognised as the directors believe that it is probable that there will be
sufficient taxable profits in the future to recover the asset in full.
No deferred tax has been provided in respect of temporary differences
associated with investments in subsidiaries and interests in joint ventures
where the Group is in a position to control the timing of the reversal of the
temporary differences and it is probable that such differences will not
reverse in the foreseeable future. The aggregate amount of temporary
differences associated with investments in subsidiaries, for which a deferred
tax liability has not been recognised, is approximately £nil (2025: £nil).
2.8 Earnings per share
Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders by the weighted average number of ordinary shares
outstanding during the year, excluding ordinary shares held by the Employee
Share Ownership Plan and ordinary shares held by the ACM Employee Benefit
Trust which are not treated as outstanding.
For diluted earnings per share, the weighted average number of ordinary shares
in issue is adjusted to assume conversion of all dilutive potential ordinary
shares. The Group has dilutive ordinary shares, being those options granted to
employees where the expected consideration is less than the average market
price of the Company's ordinary shares during the period that they are
outstanding, and convertible loan notes issued in respect of the acquisition
of Naves.
Total operations 2026 2025
£'000 £'000
Profit for the year attributable to shareholders 2,277 6,102
Pence Pence
Basic earnings per share 7.24 19.41
Effect of dilutive share options (0.88) (2.83)
Diluted earnings per share 6.36 16.58
Underlying operations 2026 2025
£'000 £'000
Underlying profit for the year attributable to shareholders 7,624 9,840
Pence Pence
Basic earnings per share 24.23 31.30
Effect of dilutive share options (2.95) (4.56)
Diluted earnings per share 21.28 26.74
A reconciliation by class of instrument in relation to potential dilutive
ordinary shares and their impact on earnings is set out below:
2026 2025
Weighted average number of shares Underlying earnings Statutory earnings Weighted average number of shares Underlying earnings Statutory earnings
£'000 £'000 £'000 £'000
Used in basic earnings per share 31,468,164 7,624 2,277 31,435,065 9,840 6,102
RSP, DBP and LTIP 4,360,433 - - 5,361,377 - -
Used in diluted earnings per share 35,828,597 7,624 2,277 36,796,442 9,840 6,102
3 Balance sheet non-current assets
3.1 Goodwill
Business combinations are accounted for using the acquisition method. The
goodwill recognised as an asset by the Group is stated at cost less any
accumulated impairment losses.
On the acquisition of a business, fair values are attributed to the net assets
(including any identifiable intangible assets) acquired. The excess of the
consideration transferred, any non-controlling interest recognised and the
fair value of any previous equity interest in the acquired entity over the
fair value of net identifiable assets acquired is recorded as goodwill.
Acquisition-related costs are recognised in the Income Statement as incurred
in accordance with IFRS 3.
In relation to acquisitions where the fair value of assets acquired exceeds
the fair value of the consideration, the excess fair value is recognised
immediately in the Income Statement as a gain on purchase.
On the disposal of a business, goodwill relating to that business remaining on
the Balance Sheet is included in the determination of the profit or loss on
disposal. As permitted by IFRS 1, goodwill on acquisitions arising prior to 1
March 2004 has been retained at prior amounts and is tested annually for
impairment.
Key estimate
Impairment of goodwill
Goodwill is tested for impairment on an annual basis, and the Group will also
test for impairment at other times if there is an indication that an
impairment may exist. Determining whether goodwill is impaired requires an
estimation of the value-in-use of the cash-generating units to which these
assets have been allocated. The value-in-use calculation estimates the
present value of future cash flows expected to arise for the cash-generating
units. The key estimates are therefore the selection of suitable discount
rates and the estimation of future growth rates which vary between
cash-generating units depending on the specific risks and the anticipated
economic and market conditions related to each cash-generating unit.
As part of determining the value in use of each CGU group, management has
considered the potential impact of climate change on the business performance
over the next five years, and the terminal growth rates. While there is
considerable uncertainty relating to the longer term and quantifying the
impact on a range of outcomes, management considers that environmental-related
incremental costs are expected to have a relatively low impact. Recognising
that there are extreme but unlikely scenarios, the Group considers that while
exposed to physical risks associated with climate change (such as flooding,
heatwaves, sea level rises and increased precipitation) the estimated impact
of these on the Group is not deemed material. In addition, the Group is
exposed to transitional risks which might arise, for example, from government
policy, customer expectations, material costs and increased stakeholder
concern. The transitional risks could result in financial impacts such as
higher environmentally focused levies (e.g. carbon pricing). While the Group
is exposed to the potential financial impacts associated with transitional
risks, based on information currently available, these are not deemed to have
a significant impact.
The key assumptions and the sensitivity of them to the carrying values are
provided in the note below.
£'000
Cost
At 29 February 2024 87,816
Exchange adjustments (409)
At 28 February 2025 87,407
Exchange adjustments 686
At 28 February 2026 88,093
Accumulated impairment
At 29 February 2024 16,479
Exchange adjustments (315)
At 28 February 2025 16,164
Exchange adjustments 528
At 28 February 2026 16,692
Net book value at 28 February 2026 71,401
Net book value at 28 February 2025 71,243
All goodwill is allocated to cash-generating units. The allocation of goodwill
to groups of cash-generating units is as follows:
2026 2025
£'000 £'000
Chartering 68,696 68,696
Corporate Finance (part of Investment Advisory segment) 2,705 2,547
Total goodwill 71,401 71,243
These groups of cash-generating units represent the lowest level within the
Group at which goodwill is monitored for internal management purposes.
All goodwill is denominated in the Group's reporting currency, with the
exception of the Corporate Finance Division which is denominated in euros.
Goodwill denominated in foreign currencies is revalued at the Balance Sheet
date. The exchange adjustment for the year ended 28 February 2026 was a gain
of £0.2 million (2025: loss of £0.1 million).
The Group is required to test, on an annual basis, whether goodwill has
suffered any impairment. The recoverable amount is determined based on
value-in-use calculations. The use of this method requires the estimation of
future cash flows and the determination of a discount rate in order to
calculate the present value of the cash flows.
The key assumptions on which the value-in-use calculations are based relate to
(i) business performance over the next five years; (ii) long-term growth rates
beyond 2031; and (iii) discount rates applied.
i) Business performance over the next five years -
The estimated cash flows were based on the approved annual budget for the next
financial year and projections for the following four years which are based on
management's estimates of revenue growth and cost inflation which reflect past
experience and management's expectation of future events given the specific
risks and economic and market conditions of each cash-generating unit. The
assumptions behind these projections are consistent with the viability
statement. Cash flows have been used over a period of five years as management
believes this reflects a reasonable time horizon for management to monitor the
trends in the business.
ii) Long-term growth rates - This is the average
growth rate used to extrapolate cash flows beyond the budget period.
iii) Discount rates - The post-tax discount rate was
determined based on a weighted average cost of capital ("WACC") and adjusted
for CGU-specific risk factors specific to the CGU group.
The effect on cash flows of climate change was considered but assessed to have
no material impact at this time. Management does not believe that
climate-related risks nor the potential impact of climate change on the
Group's operations would materially affect the recoverability of goodwill in
either of the cash-generating units.
The results of the impairment tests are as follows:
a) Chartering
The key assumptions and resulting net present values are as follows:
Chartering 2026 2025
Pre-tax discount rate 14.3% 11.8%
Revenue growth/(decline) in year 1 1.1% (1.6)%
Average revenue growth rate years 2-5 3.0% 3.0%
Operating profit margin years 1-5 10.3% - 10.7% 11.4% - 12.1%
Long-term growth rate 1.7% 1.7%
At 28 February 2026, the net present value of the Chartering segment is higher
than the carrying value of the goodwill and other assets in respect of this
cash-generating unit. At the Balance Sheet date, management concluded that
there is no impairment.
b) Corporate Finance
Revenues for the Corporate Finance Division are challenging to forecast
because of the highly variable nature of success fees. Management forecasts
over the five-year forecast period consider recent performance and reflect
management's best estimate of success fee with volatility of the success fee
taken into account. Growth rates used in the value-in-use test reflect this
variability and were based on the best estimate of management.
Corporate Finance 2026 2025
Pre-tax discount rate 17.5% 13.7%
Revenue growth in year 1 2.0% 9.4%
Average revenue growth rate years 2-5 5.0% 5.0%
Operating profit margin years 1-5 19.1% - 24.4% 21.3% - 24.2%
Long-term growth rate 1.7% 1.7%
At 28 February 2026, the net present value of the Corporate Finance CGUs is
higher than the carrying value of the goodwill and other assets in respect of
the cash-generating units. At the Balance Sheet date, management concluded
that there is no impairment.
Sensitivity to impairment
To test the sensitivity of the results of the impairment review, the
calculations have been re-performed, flexing the three key assumptions:
- revenue growth rate from years 2 to 5;
- pre-tax discount rate; and
- revenue outperforms or underperforms forecast in year 1 with
subsequent revenue growth in line with the above assumptions in years 2 to 5.
In addition, because the majority of the Group's revenue is denominated in US
dollars, a change in foreign currency exchange rate could have a significant
impact on the determined value. The sensitivity of a change in exchange rates
is also modelled by reference to the impact of changes in revenue performance.
The recoverable amount of the Group's goodwill relating to Chartering exceeds
its carrying value by £7.7 million. The below table presents the net variance
in the calculated value in use of Chartering under each scenario:
Change in revenue growth Change in discount rate Year 1 revenue outperforms or underperforms forecast
+1% -1% +2% -2% +15% -15%
£'000 £'000 £'000 £'000 £'000 £'000
Chartering 6,199 (6,038) (10,729) 14,798 27,791 (27,791)
Further, the break-even points of the impairment review which would result in
an impairment when flexing these three key assumptions are as below:
Change in assumptions Increase/(decrease)
Revenue growth rate from years 2 to 5 (1.3%)
Discount rate 1.4%
Revenue underperforms forecast in year 1 (4.2%)
The recoverable amount of the Group's goodwill relating to Corporate Finance
exceeds its carrying value by £0.4 million. The below table presents the net
variance in the calculated value in use of Corporate Finance under each
scenario:
Change in revenue growth Change in discount rate Year 1 revenue outperforms or underperforms forecast
+1% -1% +2% -2% +15% -15%
£'000 £'000 £'000 £'000 £'000 £'000
Corporate Finance 196 (191) (371) 480 924 (924)
Further, the break-even points of the impairment review which would result in
an impairment when flexing these three key assumptions are as below:
Change in assumptions Increase/(decrease)
Revenue growth rate from year 2 to 5 (2.1%)
Discount rate 2.1%
Revenue underperforms forecast in year 1 (6.4%)
While the break-even disclosure above relates to specific discrete inputs to
management's value-in-use calculation, a combination of smaller changes in
assumptions results in larger reductions of the value-in-use.
3.2 Other intangible assets
Computer software
The Group capitalises computer software at cost. It is amortised on a
straight-line basis over its estimated useful life of up to four years.
Other intangible assets
Intangible assets acquired as part of a business combination are stated in the
Balance Sheet at their fair value at the date of acquisition less accumulated
amortisation and any provision for impairment. The amortisation of the
carrying value of the capitalised customer relationships is charged to the
Income Statement over an estimated useful life, which is up to twelve years.
The amortisation in respect of capitalised brand assets is expensed to the
Income Statement over an estimated useful life, which is between three and
twelve years.
Computer Other Total
software
intangible
£'000
assets £'000
£'000
Cost
At 29 February 2024 3,638 4,202 7,840
Disposals (1) (45) 293 248
Exchange rate adjustments (4) 15 11
At 28 February 2025 3,589 4,510 8,099
Addition 13 - 13
Disposals (1,073) - (1,073)
Exchange rate adjustments 4 (210) (206)
At 28 February 2026 2,533 4,300 6,833
Amortisation
At 29 February 2024 3,341 1,314 4,655
Charge for the year 173 412 585
Disposals (1) (44) 293 249
Exchange adjustments (3) 5 2
At 28 February 2025 3,467 2,024 5,491
Charge for the year 101 298 399
Disposal (1,063) - (1,063)
Exchange adjustments 5 (49) (44)
At 28 February 2026 2,510 2,273 4,783
Net book value at 28 February 2026 23 2,027 2,050
Net book value at 28 February 2025 122 2,486 2,608
(1) The positive amount in the prior year disposal line relates to an
immaterial correction of an amount of £0.3 million incorrectly disclosed as a
disposal in the prior year.
Other intangible assets brought forward from the prior year relate to forward
books of income acquired in acquisitions which are amortised over the period
that the income is recognised, customer relationships which are amortised over
a period of up to twelve years, and brand which is amortised over a period of
up to ten years.
At 28 February 2026, the Group had no contractual commitments for the
acquisition of computer software or other intangible assets (2025: £nil).
3.3 Investments
In accordance with IFRS 9, the Group's investments in unlisted equity
investments are measured at fair value through profit or loss as the Group has
not elected to recognise fair value gains and losses through other
comprehensive income.
2026 2025
£'000 £'000
Unlisted investments 1,443 1,720
Movement in unlisted investments £'000 £'000
Opening balance 1,720 1,633
Balance sheet transfer (279) -
Fair value gain 2 87
Closing balance 1,443 1,720
A list of subsidiary undertakings is included in Note 7.3. The Financial
Statements of the principal subsidiary undertakings are prepared to 28
February 2026.
The Group's unlisted investments include 1,000 (2025: 1,000) ordinary £1
shares in London Tanker Brokers' Panel Limited. The investment is carried at
fair value of £1.4 million; see Note 4.4 for further details.
3.4 Investment in associate
Investments
Investments in associates and joint ventures where the Group has joint control
or significant influence are accounted for under the equity method.
Investments in associates are initially recognised in the Consolidated Balance
Sheet at cost. Subsequently, associates are accounted for under the equity
method, where the Group's share of post-acquisition profits and losses and
other comprehensive income is recognised in the Income Statement and Statement
of Comprehensive Income.
Profits and losses arising on transactions between the Group and its
associates are recognised only to the extent of unrelated investors' interests
in the associate. The investor's share in the associate's profits and losses
arising from these transactions is eliminated against the carrying value of
the associate.
Where the Group's share of the associate's identifiable net assets is greater
than the cost of investment, a gain on purchase is recognised in the Income
Statement and the carrying value of the investment in the Consolidated Balance
Sheet is increased.
When the Group disposes of shares in associates or joint ventures, the Group
recognises a profit or loss on disposal based on the net proceeds less the
weighted average cost of the shares disposed of. On disposal, the Group
reclassifies foreign exchange amounts previously recognised in other
comprehensive income relating to that reduction in ownership interest if that
gain or loss would be required to be reclassified to profit or loss on the
disposal of the related assets or liabilities.
The most recent Financial Statements of an associate are used for accounting
purposes unless it is impractical to do so. Where the Group and an associate
have non-coterminous reporting dates, the associate's full-year accounts will
be used for the purposes of the Group's reporting at 28 February with
adjustments made for any significant transactions or events.
Investments where the Group has no significant influence are held at fair
value, with movements in fair value recorded in profit and loss.
Zuma Labs Limited
Zuma Labs Limited is a private company incorporated in England and Wales and
its registered address is Kemp House, 128 City Road, London, United Kingdom,
EC1V 2NX. Zuma Labs Limited has one share class and each share carries one
vote.
A purchase price allocation exercise was undertaken to measure the fair value
of the net assets on the date at which Zuma Labs Limited became an associate,
and also at each date at which further shares were subscribed for. Based on
the purchase price allocation exercise, the difference between the cost of the
investment and the Group's share of the net fair value of Zuma Labs Limited's
identifiable assets and liabilities is accounted for as goodwill. Amortisation
of that goodwill is not permitted.
IAS 28 requires the most recent financial statements of an associate are used
for accounting purposes, and that coterminous information should be used
unless it is impractical to do so. Zuma Labs Limited has a year-end of 31
March with the latest statutory accounts available being for the year ended 31
March 2025. For practical reasons Zuma Labs Limited's management accounts for
the period have been used.
At 28 February 2025, the Group's shareholding was 2,500 shares, which equated
to 20.0% of Zuma Labs Limited's share capital and 20.0% of voting rights. The
Group had representation on the board of Zuma Labs Limited, and, as a result,
the Group considered that it had the power to exercise significant influence
in Zuma Labs Limited and the investment in it was accounted for using the
equity method.
On 8 January 2026, the Group disposed of its investment in Zuma Labs Limited
for $1.25 million (£0.9 million) resulting in a gain on disposal of £0.2
million, which was recognised in the Consolidated Income Statement.
The movements in the investment in the associate are provided below.
Zuma
£'000
At 29 February 2024 713
Share of loss in associate -
At 28 February 2025 713
Disposal of interest in associate (713)
At 28 February 2026 -
3.5 Property, plant and equipment
Property, plant and equipment are shown at historical cost less accumulated
depreciation and any provision for impairment. Included in each category are
right-of-use assets where the Group is a lessee. Land and buildings primarily
includes right-of-use assets and leasehold improvements.
Depreciation is provided at rates calculated to write off the cost, less
estimated residual value of each asset, on a straight-line basis over its
expected useful life as follows:
Land and buildings
- over the lease term
Computer equipment - four years
Fixtures and equipment - four years or the lease term for
right-of-use assets
Land and buildings Computers Fixtures and Total
£'000
£'000
equipment
£'000
£'000
Cost
At 29 February 2024 16,002 2,121 2,192 20,315
Additions at cost 8,048 427 60 8,535
Disposals (160) (154) (55) (369)
Exchange differences 13 (3) (6) 4
At 28 February 2025 23,903 2,391 2,191 28,485
Reclassification 49 52 (101) -
Additions at cost 1,903 341 829 3,073
Disposals (722) (1,063) (85) (1,870)
Exchange differences (455) (29) (60) (544)
At 28 February 2026 24,678 1,692 2,774 29,144
Accumulated depreciation and impairment
At 29 February 2024 11,585 1,540 1,608 14,733
Charge for the year 2,653 361 213 3,227
Disposals (159) (150) (55) (364)
Impairment 743 - - 743
Exchange differences 20 (5) (4) 11
At 28 February 2025 14,842 1,746 1,762 18,350
Charge for the year 3,227 307 187 3,721
Disposals (670) (1,062) (80) (1,812)
Reclassification 16 9 (25) -
Impairment 391 - - 391
Exchange differences (274) (14) (41) (329)
At 28 February 2026 17,532 986 1,803 20,321
Net book value at 28 February 2026 7,146 706 971 8,823
Net book value at 28 February 2025 9,061 645 429 10,135
At 28 February 2026, the Group had no contractual commitments for the
acquisition of property, plant and equipment (2025: £nil).
3.6 Leases
Key estimate
Lease term
The Group determines the lease term as the non-cancellable period of the
lease, together with any periods covered by an option to extend the lease if
it is reasonably certain to be exercised, or any period covered by an option
to terminate the lease, if it is reasonably certain not to be exercised. The
Group also considers the local legal framework when making an assessment of
its ability to continue to occupy premises.
The assessment of whether it is reasonably certain that the Group will
exercise an extension option or not exercise a termination option is made at
the commencement of the lease. This estimate is reassessed only if there is a
significant event or significant change in circumstance that is within the
control of the Group and affects whether the Group is reasonably certain to
exercise the extension option or not exercise the termination option, not
included in the lease term.
Management applies judgement in evaluating whether it is reasonably certain
whether or not to exercise the option to renew or terminate the lease. That
is, it considers all relevant factors that create an economic incentive for
the Group to exercise either the renewal or termination option.
During the prior year, the Group increased its right-of-use assets and
corresponding lease liabilities by £7.6 million, primarily relating to its
continued use of office space, reflecting its best estimate of the of the
lease terms. Undiscounted potential future cash outflows of £8.2 million have
not been included in lease liabilities because it is not reasonably certain
that the leases will be extended (or not terminated).
The Group as a lessee
The Group has various lease arrangements for properties and other equipment.
At inception of a lease contract, the Group assesses whether the contract
conveys the right to control the use of an identified asset for a certain
period of time and whether it obtains substantially all the economic benefits
from the use of that asset, in exchange for consideration. The Group
recognises a lease liability and a corresponding right-of-use asset with
respect to all lease arrangements in which it is a lessee, except low-value
leases and short-term leases of twelve months or less, costs for which are
recognised as an operating expense within the Income Statement on a
straight-line basis.
A right-of-use asset is capitalised on the Balance Sheet at cost, comprising
the amount of the initial measurement of the lease liability and lease
payments made at or before the commencement date, plus any initial direct
costs incurred in addition to an estimate of costs to remove or restore the
underlying asset. Where a lease incentive is receivable, the amount is offset
against the right-of-use asset at inception. Right-of-use assets are
depreciated using the straight-line method over the shorter of the estimated
life of the asset or the lease term.
The lease liability is initially measured at the present value of future lease
payments. Interest expense is charged to the Consolidated Income Statement
over the lease period so as to produce a constant periodic rate of interest on
the remaining balance of the liability. The lease payments are discounted
using the interest rate implicit in the lease. If that rate cannot be
determined, the lessee's incremental borrowing rate is used, being the rate
that the lessee would have to pay to borrow the funds necessary to obtain an
asset of similar value in a similar economic environment with similar terms
and conditions. Generally, the interest rate implicit in the lease is not
readily determinable, as such the incremental borrowing rate is used to
discount future lease payments.
For the Group, lease payments generally comprise the following:
− Fixed payments, less any lease incentives receivable;
− Variable payments that are based on an index or rate; and
− Payments to be made under extension options which are reasonably certain
to be exercised.
Lease payments made are apportioned between an interest charge and a capital
repayment amount which are disclosed within the financing activities and the
operating activities sections of the Consolidated Statement of Cash Flows
respectively. When an adjustment to lease payments based on an index takes
effect, the liability is remeasured with a corresponding adjustment to the
right-of-use asset.
Contracts entered into by the Group have a wide range of terms and conditions
but generally do not impose any additional covenants. Several of the Group's
contracts include indexation adjustments to lease payments in future periods
which are not reflected in the measurement of the lease liabilities at 28
February 2026. Many of the contracts entered into by the Group include
extension or termination options which provide the Group with additional
operational flexibility. If the Group considers it reasonably certain that an
extension option will be exercised or a termination option not exercised, the
additional period is included in the lease term.
A modification to a lease which changes the lease payment amount (e.g. due to
a renegotiation or market rent review) or amends the term of the lease,
results in a reassessment of the lease liability with a corresponding
adjustment to the right-of-use asset.
The Group as a lessor
The Group classifies leases as either operating or finance leases based on the
substance of the arrangement. At commencement of a finance lease, a receivable
is recognised at an amount equal to the Group's net investment in the lease.
Finance income is recognised reflecting a constant periodic rate of return on
the net investment in the lease. Lease payments from operating leases are
recognised as income on a straight-line basis.
Right-of-use assets
The Group leases a number of properties in the jurisdictions from which it
operates. In some jurisdictions it is customary for lease contracts to provide
for payments to increase each year by inflation and in other property leases
the periodic rent is fixed over the lease term. The Group also leases certain
items of plant and equipment which are typically motor vehicles. These
contracts normally comprise only fixed payments over the lease term.
Land and buildings Fixtures and Total
£'000
equipment
£'000
£'000
At 29 February 2024 4,095 148 4,243
Additions 7,570 38 7,608
Depreciation (2,407) (81) (2,488)
Impairment (743) - (743)
Disposals (2) - (2)
Exchange differences (7) (1) (8)
At 28 February 2025 8,506 104 8,610
Additions 1,572 103 1,675
Depreciation (2,965) (65) (3,030)
Impairment (321) - (321)
Disposals (51) (6) (57)
Exchange differences (167) 1 (166)
At 28 February 2026 6,574 137 6,711
Lease liabilities
Total
£'000
At 29 February 2024 4,778
Additions 7,608
Interest expense 276
Lease payments (3,382)
Exchange differences (35)
At 28 February 2025 9,245
Additions 1,663
Disposal (41)
Interest expense 474
Lease payments (3,387)
Exchange differences 6
At 28 February 2026 7,960
The total cash outflow for leases is £3,387,000 (2025: £3,382,000), of which
£474,000 (2025: £276,000) represents payment of interest.
Contractual payments by maturity are provided in Note 4.4 (f).
During the year, the financial effect of revising the lease term of the
Group's leases subject to exercising extension and termination options was
£33,000 (2025: £nil) in the recognised lease liabilities. As at 28 February
2026, undiscounted potential future cash outflows of £8.2 million (2025:
£8.1 million) have not been included in the lease liability because it is not
reasonably certain that the leases will be extended (or not terminated).
Lease receivables
Gross Provision Net
£'000
£'000
£'000
At 29 February 2024 240 - 240
Interest income 1 - 1
Lease payments (241) - (241)
At 28 February 2025 and 28 February 2026 - - -
2026 2025
£'000 £'000
Short-term lease expense (146) (232)
Short-term lease income 99 128
4 Balance sheet - Operating assets and liabilities
4.1 Other long-term receivables
The following table sets out the assets of the Group expected to be recovered
in greater than twelve months.
2026 2025
£'000 £'000
Security deposits 362 360
Prepayments 358 1,408
720 1,768
Prepayments includes the non-current element of the clawback provision on
joining and retention incentives paid to certain employees. The receivable is
amortised over the clawback period, and therefore is expected to be recovered
in greater than twelve months.
4.2 Trade and other receivables
Trade receivables and contract assets
Trade receivables and contract assets that do not have a significant financing
component are initially recognised at their transaction price and subsequently
measured at amortised cost.
At the Balance Sheet date, there may be amounts where invoices have not been
raised but performance obligations have been satisfied, and these are
recognised as contract assets.
Specific provision for impairment is made where there is evidence that the
balances will not be recovered in full. An impairment provision for expected
credit losses is made for trade receivables and contract assets using the
simplified approach. A provision matrix is used to calculate an expected
credit loss as a percentage of carrying value by age. The percentages are
determined based on historical credit loss experience as well as
forward-looking information. Impairment provisions are made for other
receivables based on lifetime expected credit losses using a model that
considers forward-looking information and significant increases in credit
risk.
Trade and other receivables are non-interest bearing and generally on terms
payable within 30 to 90 days.
Other items
For the accounting policy and further details on deferred and contingent
consideration receivable, see Note 4.9. The accounting policy for finance
lease receivables is set out in Note 3.6.
Key estimate
Provision for impairment of trade receivables and contract assets
Trade receivables and contract assets are amounts due from customers in the
ordinary course of business. Trade receivables and contract assets are
classified as current assets if collection is due within one year or less (or
in the normal operating cycle of the business if longer). If not, they are
presented as non-current assets.
The provision for impairment of trade receivables and contract assets
represents management's best estimate at the Balance Sheet date. A number of
judgements are made in the calculation of the provision, primarily the age of
the invoice, the existence of any disputes, recent historical payment patterns
and the debtor's financial position.
When measuring expected credit losses, the Group uses reasonable and
supportable forward-looking information, which is based on assumptions for the
future movement of different economic drivers and how these drivers will
affect each other. Probability of default constitutes a key input in measuring
expected credit losses. Probability of default is an estimate of the
likelihood of default over a given time horizon, the calculation of which
includes historical data, assumptions and expectations of future market
conditions. The expected loss rates applied to receivables are provided in
this Note.
A 2% increase in the expected credit loss rate across all past due time bands
would result in an increase to the provision of £0.6 million (2025: £0.5
million) and a decrease of 2% would result in a decrease in the provision of
£0.4 million (£0.5 million).
2026 2025
£'000 £'000
Trade receivables 29,925 28,871
Provision for impairment of trade receivables (4,059) (3,433)
Net trade receivables 25,866 25,438
Deferred consideration - 1,336
Contingent consideration - 654
Other receivables(1) 7,094 5,078
Finance lease receivables - -
Contract assets 1,356 1,270
Prepayments 4,896 7,111
Total 39,212 40,887
(1)Other receivables is net of an impairment provision of £171,000 (2025:
£113,000 provision which is included in Provision for impairment of trade
receivables).
Deferred consideration and contingent consideration relate to the earnout
payments receivable in respect of the disposal of Cory Brothers; further
detail is provided in Note 4.9.
Included in other receivables are amounts in relation to the Group's 50% in
interest in its joint operation with GFI, an operating division within BGC
Group Inc., which conducts wet freight derivative broking. VAT and other sales
tax receivables and employee loans are also included in other receivables.
Prepayments include an asset of £1.7 million (2025: £2.2 million) in respect
of the current portion of the clawback provision on joining incentives paid to
certain employees which are being charged to the Income Statement in
accordance with the clawback provisions of the underlying contracts. The
receivable is amortised over the clawback period.
The directors consider that the carrying amounts of trade receivables
approximate to their fair value.
Trade receivables are non-interest bearing and are generally on terms payable
within 30-90 days; terms associated with the settlement of the Group's trade
receivables vary across the Group. Specific debts are provided for where
recovery is deemed uncertain, which will be assessed on a case-by-case basis
whenever debts are older than the due date, but always when debts are older
than usual for the industry in which each business in the Group operates.
As at 28 February 2026, trade receivables of £3.2 million (2025: £2.8
million) which were over twelve months old were treated as credit impaired and
have been provided for. A £0.2 million provision (2025: £nil) has been made
for specific trade receivables which are less than twelve months overdue.
The Group applies the IFRS 9 simplified approach to measuring expected credit
losses using a lifetime expected credit loss provision for trade receivables
and contract assets. To measure expected credit losses on a collective basis,
trade receivables and contract assets are grouped based on similar credit risk
and ageing. The contract assets have similar risk characteristics to the trade
receivables for similar types of contracts.
Based on the Group's historical experience, debtors that reach more than
twelve months past due are generally considered credit impaired. The expected
loss rates are based on the Group's historical credit losses and rates are
then adjusted for current and forward-looking information on macroeconomic
factors affecting the Group's customers. Trade receivables and contract assets
are written off where there is no reasonable expectation of recovery.
Indicators that there is no reasonable expectation of recovery include,
amongst others, the failure of a debtor to engage in a repayment plan with the
Group, and a failure to make contractual payments for a period of greater than
365 days past due.
The ageing profile of trade receivables and the lifetime expected credit loss
for provisions and contract assets is as follows:
2026 Trade Expected loss rate Group Total provision for impairment
receivables
% provision ECL of trade receivables
£'000
£'000 provision £'000
£'000
Up to 3 months 20,976 0.5 - 96 96
3 to 6 months 3,102 3.8 - 117 117
6 to 12 months 2,621 23.3 208 404 612
Over 12 months 3,226 100 3,226 - 3,226
Trade receivables 29,925 13.5 3,434 617 4,051
Contract assets 1,356 0.6 - 8 8
Total 31,281 13.0 3,434 625 4,059
2025 Trade Expected loss rate Group Total provision for impairment
receivables
% provision ECL of trade receivables
£'000
£'000 provision £'000
£'000
Up to 3 months 20,138 1.8 - 365 365
3 to 6 months 2,787 2.0 - 56 56
6 to 12 months 3,002 5.0 - 150 150
Over 12 months 2,944 96.8 2,849 - 2,849
Trade receivables 28,871 11.8 2,849 571 3,420
Contract assets 1,270 1.0 - 13 13
Total 30,141 11.4 2,849 584 3,433
Movements on the provision for impairment of trade receivables and contract
assets were as follows:
2026 2025
£'000 £'000
At 1 March 3,433 2,837
Impairment charge 1,079 1,039
Receivables written off during the year as uncollectible (142) (445)
Reclassification of other provisions (171) -
Foreign exchange (gain)/loss (140) 2
At 28 February 4,059 3,433
Amounts receivable written off in the year relate to previously fully provided
for amounts.
Contract assets
The Group's contract assets related to accrued income which has not yet been
invoiced at the Balance Sheet date. Significant changes in contract assets
during the period are analysed as follows:
2025
2026 £'000
£'000
At 1 March 1,270 1,517
Contract assets converted to receivables on invoicing (1,216) (1,434)
Contract assets arising on new contracts in year 1,302 1,187
At 28 February 1,356 1,270
The movement in the asset between years is due to the invoicing of prior year
assets and the accrual of amounts relating to the current year.
4.3 Trade and other payables
Commissions payable to co-brokers are recognised in trade payables due within
one year on the earlier of the date of invoicing or the date of receipt of
cash. The accounting policy for lease liabilities is set out in Note 3.6.
Current liabilities 2026 2025
£'000 £'000
Trade payables 4,113 3,646
Lease liabilities 3,555 2,733
Other taxation and social security 366 374
Other payables 830 1,375
Contract liabilities 675 533
Accruals 27,790 26,071
Total 37,329 34,732
Accruals primarily includes accrued bonuses and other specific accruals.
The directors consider that the carrying amounts of trade payables approximate
to their fair value.
Non-current liabilities 2026 2025
£'000 £'000
Deferred bonus accrual 1,601 -
Other payables 197 498
Total 1,798 498
4.4 Financial instruments and risk management
The Group is exposed through its operations to the following financial risks:
- Currency risk;
- Interest rate risk;
- Credit risk; and
- Liquidity risk.
In common with all other businesses, the Group is exposed to risks that arise
from its use of financial instruments. This note describes the Group's
objectives, policies and processes for managing those risks and the methods
used to measure them. Further quantitative information in respect of these
risks is presented throughout the Financial Statements.
There have been no substantive changes in the Group's exposure to financial
instrument risks, its objectives, policies, and other processes for managing
those risks, or the methods used to measure them from previous periods.
a) Financial instruments
i) Principal financial instruments
The principal financial instruments used by the Group, from which financial
risks arise, are as follows:
- Trade and other receivables;
- Cash and cash equivalents;
- Deferred consideration receivable;
- Contingent consideration receivable;
- Unlisted investments;
- Trade and other payables;
- Revolving credit facility;
- Lease liabilities; and
- Derivative financial instruments.
ii) Financial instruments by category
Financial instruments measured at fair value
The Group's financial assets and liabilities measured at fair value through
profit and loss, including their fair value hierarchy, are as follows. Fair
value is the amount at which a financial instrument could be exchanged in an
arm's length transaction, other than in a forced or liquidated sale.
Level 1 Level 2 Level 3 As at
£'000 £'000 £'000 28 Feb 2026
£'000
Financial assets:
Unlisted investment - - 1,443 1,443
Derivative contracts(1) - 2,027 - 2,027
Total - 2,027 1,443 3,470
Financial liabilities:
Derivative contracts(1) - 51 - 51
Total - 51 - 51
Level 1 Level 2 Level 3 As at
£'000 £'000 £'000 28 Feb 2025
£'000
Financial assets:
Unlisted investment - - 1,720 1,720
Contingent consideration receivable - - 654 654
Derivative contracts(1) - 397 - 397
Total - 397 2,374 2,771
Financial liabilities:
Derivative contracts(1) - 679 - 679
Embedded derivative - - 29 29
Total - 679 29 708
(1)Currency forwards with a fair value of £2.0 million (2025: £0.2 million)
maturing within twelve months have been shown as current assets. Currency
forwards with a fair value of £nil (2025: £0.2 million) maturing in greater
than twelve months of the Balance Sheet date have been shown as non-current
assets. Liabilities include currency forwards with a fair value of £0.1
million (2025: £0.6 million) maturing within twelve months shown as current
liabilities and currency forwards with a fair value of £nil (2025: £0.1
million) maturing in greater than twelve months of the Balance Sheet date
shown as non-current liabilities.
Fair value hierarchy
The level in the fair value hierarchy within which the financial asset or
liability is categorised is determined on the basis of the lowest level input
that is significant to the fair value measurement.
Financial assets and liabilities are classified in their entirety into one of
three levels:
- Level 1: Quoted prices (unadjusted) in active markets for
identical assets or liabilities.
- Level 2: Inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either directly or
indirectly.
- Level 3: Inputs for the asset or liability that are not
based on observable market data.
Valuation processes
The Group's finance team and Group Chief Financial Officer are responsible for
fair value measurement of financial instruments and make the decision as to
the valuation technique to be applied, along with the level of external
support required. The Group uses external specialists to value some of the
financial instruments included within Level 3 of the fair value hierarchy. The
results of those valuations are reviewed at each reporting date within the
finance team.
The following table provides a reconciliation of movements in Level 3
financial assets during the year:
Contingent consideration receivable Unlisted investments
£'000 £'000
Fair value at 29 February 2024 1,082 1,633
Transfer into Level 3 - -
Fair value gain recognised in operating costs 128 87
Cash settlement (556) -
Fair value at 28 February 2025 654 1,720
Balance sheet transfer - (281)
Fair value gain recognised in operating costs 9 4
Cash settlement (663) -
Fair value at 28 Feb 2026 - 1,443
Unlisted investments
The unlisted investment primarily relates to the Group's investment in the
London Tanker Brokers' Panel; see Note 3.3. The Group has valued the
investment based on an income approach which has resulted in the fair value
being deemed to be in Level 3 of the fair value hierarchy. The Group's policy
is that the beginning of the financial year is considered the date of transfer
between levels in the fair value hierarchy. The significant unobservable
inputs into the valuation are:
- a discount rate of 14.8% (2025: 16.0%); and
- expected income from the investment.
An increase in the discount rate of 2% would result in a fair value loss of
£0.2 million recognised in the Income Statement, while a decrease in the
discount rate of 2% would result in a gain of £0.2 million recognised in the
Income Statement. A 10% increase/decrease in expected income would result in a
£0.1 million gain/loss.
Contingent consideration receivable
The fair value of the contingent consideration receivable includes
unobservable inputs and is therefore classified as Level 3. The contingent
consideration receivable relates to the disposal of the Logistics Division.
The SPA provides for a minimum guaranteed amount in each of the three years
following disposal; this amount is classified as deferred consideration. The
balance of the earnout consideration is contingent on the future performance
of the combined business up to a maximum specified in the SPA; this is
classified as contingent consideration. The prior year fair value of the
contingent consideration has been calculated by reference to management's
expectation of the future profitability of the combined business and
discounted to present value using a discount rate of 5.51%. The discount rate
takes into account the credit risk of Vertom Agencies BV. See Note 4.9 for
further details.
Derivative contracts
Contracts with derivative counterparties are based on ISDA Master Agreements.
Under the terms of these arrangements, only in certain situations will the net
amounts owing/receivable to a single counterparty be considered outstanding.
The Group does not have the present legal ability to set off these amounts and
so they are not offset in the Balance Sheet. Of the derivative assets and
derivative liabilities recognised in the Balance Sheet, an amount of £0.1
million (2025: £0.4 million) would be set off under enforceable master
netting agreements.
Forward currency contracts
The fair value of the forward currency contracts are based on prices quoted by
the counterparty within these contracts versus the market rate at the Balance
Sheet date and have therefore been classified as Level 2 in the fair value
hierarchy. See the currency risk section for further details.
Embedded derivative
The convertible loan note instruments issued on the acquisition of Naves
contain an embedded derivative, being a euro liability of principal and
interest. The equity value of the underlying derivative is not considered
closely related to the debt host, therefore the loan note is considered to be
a financial liability host with an embedded derivative convertible feature
which is required to be separated from the host. The fair value of the
embedded derivative includes unobservable inputs and is therefore classified
as Level 3. The key assumptions underpinning the fair value of the embedded
derivative relate to the expected future share price of the Group and the
GBP:EUR exchange rate. The fair value has been determined using a
Black-Scholes valuation model.
A gain of £29,000 (2025: £111,000 gain) has been recognised in the Income
Statement in respect of the fair value movement of the embedded derivative
from 1 March 2025 to 28 February 2026. On settlement of the outstanding
convertible loan notes during the year, the embedded derivative has also been
extinguished.
Financial instruments not measured at fair value
The Group's financial assets and liabilities that are not measured at fair
value are measured at amortised cost. Due to their short-term nature or
frequent repricing, the carrying value of these financial instruments
approximates their fair value. Their carrying values are as follows:
Financial assets 2026 2025
£'000 £'000
Cash and cash equivalents 23,363 20,477
Deferred consideration receivable - 1,336
Trade and other receivables 34,384 32,237
Total 57,747 54,050
Financial liabilities 2026 2025
£'000 £'000
Trade and other payables 6,518 6,095
Convertible loan notes - 2,401
Long-term borrowings 26,324 22,936
Total 32,842 31,432
Deferred consideration receivable
The initial fair value of the deferred consideration receivable was determined
by discounting the guaranteed minimum amounts as per the SPA to present value
using a discount rate of 2.39% and it is subsequently measured at amortised
cost.
b) Currency risk
Currency risk arises when Group entities enter into transactions denominated
in a currency other than their functional currency. The Group's policy is,
where possible, to allow Group entities to settle liabilities denominated in
their functional currency with the cash generated from operations in that
currency. The Group's currency risk exposure arises mainly as a result of the
majority of its earnings being denominated in US dollars while the majority of
its costs are denominated in sterling. There is also some currency exposure
related to convertible loan notes and deferred consideration denominated in
euros and from the carrying values of its overseas subsidiaries being
denominated in foreign currencies.
The Group manages its transactional exposures to foreign currency risks using
forward exchange contracts and currency options. The Group is primarily
exposed to fluctuations in US dollar to sterling exchange rates on foreign
currency sales and hedges a proportion of those expected cash flows out to 12
months (2025: 17 months). The principal source of hedge ineffectiveness is the
risk of changes in timing of the forecast transaction or that they do not
occur, which is addressed by only hedging a proportion of future foreign
currency sales. There were no hedged transactions forecast in the current year
which did not occur (2025: £nil).
The Group's results, which are reported in sterling, are exposed to changes in
foreign currency exchange rates across a number of different currencies with
the most significant exposures relating to the US dollar. The Group is exposed
to the underlying translational movements which remain outside the control of
the Group. The Group's translational exposures to foreign currency risks
relate to both the translation of income and expenses and net assets of
overseas subsidiaries which are converted into sterling on consolidation. The
Group finances overseas investments partly through the use of foreign currency
borrowings in order to provide a net investment hedge over the foreign
currency risk that arises on translation of its foreign currency
subsidiaries.
The Group continues to apply hedge accounting to hedging instruments that meet
the criteria set out in IFRS 9.
c) Hedge accounting
Derivatives are initially recognised at fair value and are subsequently
remeasured at their fair value at each Balance Sheet date with gains and
losses recognised immediately in the Income Statement unless hedge accounting
is applied. Recognition of the resulting gain or loss depends on whether the
derivative is designated as a hedging instrument and, if it is, the nature of
the item being hedged. Changes in the fair value of derivatives that do not
qualify for hedge accounting are recognised immediately in the Income
Statement within finance costs or income.
To qualify for hedge accounting, the terms of the hedge must be clearly
documented at inception and there must be an expectation that the derivative
will be highly effective in offsetting changes in the cash flow of the hedged
risk. Hedge effectiveness is tested throughout the life of the hedge and if at
any point it is concluded that the relationship can no longer be expected to
remain highly effective in achieving its objective, the hedge relationship is
terminated.
The fair value of derivative contracts is based either directly or indirectly
on market prices at the Balance Sheet date.
Financial assets and liabilities are classified in accordance with the fair
value hierarchy specified by IFRS 13. See Note 4.4.
Cash flow hedge accounting
Cash flow hedges are used to hedge the variability in cash flows of highly
probable forecast transactions caused by changes in foreign currency exchange
rates and interest rates. Where a derivative financial instrument is
designated in a cash flow hedge relationship with a highly probable forecast
transaction, the effective part of any change in fair value arising is
deferred in the cash flow hedging reserve within equity, via the Statement of
Comprehensive Income. The Group designates a portion, being the first US
dollar amounts in a particular period, of forecast revenue transactions in
cash flow hedges and reports any gain or loss as part of revenue when the
revenue is recognised. The gain or loss relating to the ineffective part is
recognised in the Income Statement within net finance expense. Amounts
deferred in the cash flow hedging reserve are reclassified to the Income
Statement in the periods when the hedged item is recognised in the Income
Statement.
If a hedging instrument expires or is sold but the hedged forecast transaction
is still expected to occur, the cumulative gain or loss at that point remains
in equity and is recognised in accordance with the above policy when the
transaction occurs. If the hedged transaction is no longer expected to take
place, the cumulative unrealised gain or loss recognised in equity is
recognised immediately in the Income Statement.
The critical terms of the hedging instruments match the hedged transactions in
relation to currency, timing and amounts, meaning there is a clear economic
relationship between the hedging instrument and hedged item as required under
IFRS 9. Thereby, management qualitatively demonstrates that the hedging
instrument and the hedged items will move equally in the opposite direction.
A gain of £3.4 million (2025: £1.5 million gain) in relation to effective
hedges has been recognised in the Income Statement in respect of derivative
contracts which have matured in the period. No ineffectiveness in relation to
hedge accounting has been recognised in the period.
Forward currency contracts 2026 2025
Carrying amount of asset £2,027,006 £397,427
Carrying amount of liability £(51,225) £(679,140)
Total notional amount US $75,900,000 US $115,650,000
Maturity dates March 2026 to February 2027 March 2025 to September 2026
Hedge ratio 1:1 1:1
Change in fair value of outstanding hedging instruments since inception of the £1,975,781 £(281,714)
hedge
Change in value of hedged item used to determine hedge ineffectiveness £(1,975,781) £281,714
Weighted average strike rate for outstanding hedging instruments 1.30 1.26
Net investment hedge accounting
The Group uses its US dollar denominated borrowings as a hedge against the
translation exposure on the Group's net investment in overseas companies. The
Group designates the spot rate of the loans as the hedging instrument. There
was no ineffectiveness to be recognised on hedges of net investments in
foreign operations. Where the hedge is fully effective at hedging the
variability in the net assets of such companies caused by changes in exchange
rates, the changes in value of the borrowings are recognised in the
translation reserve within equity, via the Statement of Comprehensive Income.
The ineffective part of any change in value caused by changes in exchange
rates is recognised in the Income Statement within finance income or costs.
The effective portion will be recycled into the Income Statement on the sale
of the foreign operation.
The table below provides further information on the Group's net investment
hedging relationships:
2026 2025
£'000 £'000
Hedge ratio 1:1 1:1
Change in value of hedging instruments due to foreign currency movements since 263 (19)
1 March
Change in value of the hedged item used to determine hedge effectiveness (263) 19
The balances and movements into and out of the foreign currency translation
reserve are shown in the Consolidated Statement of Comprehensive Income and
the Consolidated Statement of Changes in Equity respectively. The amount in
the foreign currency translation reserve in relation to hedge accounting is a
gain of £0.4 million (2025: £0.1 million gain) and is split as follows:
- continuing net investment hedges gain of £0.4 million (2025:
£0.1 million gain); and
- hedging relationships for which hedge accounting is no longer
applied, £nil (2025: £nil)..The effect on equity and profit before tax if
the US dollar or the euro strengthened/(weakened) by 10% against sterling,
with all other variables being equal, is as follows:
Profit or loss Equity, net of tax
+10% strengthening £'000 -10% +10% strengthening £'000 -10%
weakening weakening
£'000 £'000
28 February 2026
US dollars 1,934 (1,582) (2,653) 3,020
Euros 423 (346) 423 (346)
Total 2,357 (1,928) (2,230) 2,674
28 February 2025
US dollars 1,247 (1,020) (6,762) 5,533
Euros 255 (209) 255 (209)
Total 1,502 (1,229) (6,507) 5,324
d) Interest rate risk
The Group is exposed to interest rate risk from borrowings at floating rates.
The Group minimises its short-term exposure to interest rate risk on its cash
and cash equivalents by pooling cash balances across the Group's entities.
The Group has not entered into any financial instruments to fix or hedge the
interest rates applied to its bank borrowings and overdrafts.
The following table sets out the carrying amount, by maturity, of the Group's
financial instruments which are exposed to interest rate risk:
Note 2026 2025
£'000 £'000
Floating rate:
Within one year
Cash and cash equivalents 4.5 23,362 20,472
Long-term borrowings 4.6 (26,524) (23,210)
(3,162) (2,738)
Cash balances are generally held on overnight deposits at floating rates
depending on cash requirements and the prevailing market rates for the amount
of funds deposited. The other financial instruments of the Group are
non-interest bearing.
The effect on equity and profit before tax of a 1% increase/(decrease) in the
interest rate, all other variables being equal, is as follows:
Profit or loss Equity, net of tax
+1% increase £'000 -1% decrease £'000 +1% increase £'000 -1% decrease £'000
28 February 2026
Cash and cash equivalents 217 (217) 217 (217)
Long-term borrowings (254) 254 (254) 254
Total (37) 37 (37) 37
28 February 2025
Cash and cash equivalents 251 (251) 251 (251)
Long-term borrowings (233) 233 (233) 233
Total 18 (18) 18 (18)
e) Credit risk
The maximum exposure to credit risk at the end of the reporting period is the
carrying amount of each class of financial assets. Concentrations of credit
risk with respect to trade receivables are limited due to the diversity of the
Group's customer base. The directors believe there is no further credit risk
provision required in excess of normal provisions for doubtful receivables,
estimated by management based on prior experience and their assessment of the
current economic environment. The Group seeks to trade only with creditworthy
parties and carries out credit checks where appropriate. The maximum exposure
is the carrying amount as disclosed in Note 4.4.
f) Liquidity risk
Liquidity risk arises from the Group's management of working capital and the
finance charges and principal repayments on its debt instruments. It is the
risk that the Group will encounter difficulty in meeting its financial
obligations as they fall due.
The Group's policy is to ensure that it will always have sufficient cash to
allow it to meet its liabilities when they become due. Management receives
rolling 13-week cash flow projections on a weekly basis to ensure the Group
has sufficient liquidity.
The board receives rolling twelve-month cash flow projections on a monthly
basis as well as information regarding cash balances. At the end of the
financial year, these projections indicated that the Group expected to have
sufficient liquid resources to meet its obligations under all reasonably
expected circumstances.
The following table sets out the undiscounted contractual amounts due, in
relation to the Group's financial liabilities which exposes the Group to
liquidity risk:
At 28 February 2026 Up to Between Between Between Over Total Total
3 months
3 and
1 and
2 and
5 years
contractual
carrying
12 months
2 years
5 years
amount
amount
£'000
£'000
£'000 £'000 £'000 £'000 £'000
Trade and other payables 6,466 52 - - - 6,518 6,518
Loans and borrowings 374 1,121 27,560 - - 29,055 26,324
Lease liabilities 915 2,919 3,465 1,040 139 8,478 7,960
Total 7,755 4,092 31,025 1,040 139 44,051 40,802
Forward currency contracts 51
Gross outflows - 20,473 - - - 20,473
Gross inflows - (20,444) - - - (20,444)
Net outflow from derivative contracts - 29 - - - 29
At 28 February 2025 Up to Between Between Between Over Total Total
3 months
3 and
1 and
2 and
5 years
contractual
carrying
12 months
2 years
5 years
amount
amount
£'000
£'000
£'000 £'000 £'000 £'000 £'000
Trade and other payables 5,750 364 - - - 6,114 6,095
Loans and borrowings 367 1,102 1,469 24,228 - 27,166 22,936
Lease liabilities 761 2,362 3,371 3,589 6 10,089 9,245
Convertible loan notes 36 2,454 - - - 2,490 2,401
Total 6,914 6,282 4,840 27,817 6 45,859 40,677
Forward currency contracts 679
Gross outflows 7,348 46,032 25,618 - - 78,998
Gross inflows (7,288) (45,474) (25,715) - - (78,477)
Net outflow from derivative contracts 60 558 (97) - - 521
Loans and borrowings have been represented to show the expected interest
payments payable on the revolving credit facility in addition to the repayment
of the loan.
g) Capital management
The Group manages its capital structure so as to maintain investor and market
confidence and to provide returns to shareholders that will support the future
development of the business. The Group makes adjustments to the capital
structure if required in response to changes in economic conditions. The Group
considers its capital as consisting of ordinary shares and retained earnings.
To maintain or adjust the capital structure, the Group may adjust the dividend
payment to shareholders, return capital to shareholders or issue new shares.
The Group has a policy of maintaining positive cash balances and also has a
revolving credit facility which it draws down as required to provide cover
against the cyclical nature of the shipping industry.
The board monitors underlying business performance to determine the ongoing
use of capital, namely executive and staff incentive schemes (and whether to
fund this through cash or share incentives); acquisition appraisals ahead of
potential business combinations; investment in property, plant and equipment;
and the level of dividends.
No changes were made in the objectives, policies or processes during the years
ended 28 February 2026 and 28 February 2025.
4.5 Cash and cash equivalents
Cash and cash equivalents included in the Balance Sheet comprise cash in hand,
short-term deposits with an original maturity of three months or less and
restricted cash.
Cash and cash equivalents included in the Cash Flow Statement include cash and
short-term deposits. Bank overdrafts are included in the Balance Sheet within
short-term borrowings.
2026 2025
£'000 £'000
Cash at bank and cash in hand 23,363 20,477
Total 23,363 20,477
Cash and cash equivalents largely comprise bank balances denominated in
sterling, US dollars, euros and other currencies for the purpose of settling
current liabilities.
Cash includes an amount of £7.1 million (2025: £6.0 million) held in the
bank accounts of regulated entities where there is a requirement to hold a
certain amount of cash at any one time in order to cover future obligations.
No charge or other restriction of use is held over this cash.
The directors consider that the carrying amounts of these assets approximate
to their fair value.
4.6 Long-term liabilities
Arrangement costs for loan facilities are capitalised and amortised over the
life of the debt at a constant rate. Finance costs are charged to the Income
Statement, based on the effective interest rate of the associated external
borrowings and debt instruments.
Modification of terms of financial liabilities
When the terms of an existing financial liability are modified, management
will consider both quantitative and qualitative factors to assess whether the
modification is substantial. In the case that the modification of the terms of
existing financial liability is considered to be substantial, the modification
is accounted for as an extinguishment of that financial liability and the
recognition of a new financial liability. If the modification is not
considered substantial, then the existing financial liability is remeasured in
accordance with its original classification and any gain or loss is recognised
immediately in the Income Statement. During the year the Group exercised its
option and received approval for the accordion facility as set out below.
2026 2025
£'000 £'000
Long-term borrowings
Secured revolving credit facilities 26,324 22,936
Lease liabilities 4,405 6,512
Total 30,729 29,448
The Group's revolving credit facility ("RCF") is for £40.0 million which has
increased by £10 million following approval of the accordion facility of
£10.0 million. In the prior year, the Group exercised an option to extend the
facility by two years which was approved by the lender, extending the term to
November 2027. The RCF agreement has an EBITDA leverage covenant of 2.5x and a
minimum interest cover of 4x. At 31 May 2025, 31 August 2025, 30 November 2025
and 28 February 2026 the Group met all financial covenant tests. In addition,
there is a further requirement to provide HSBC with the Group's audited
financial statements within six months of the year-end. Amounts can be rolled
on a monthly basis until the facility expires subject to certain conditions,
and on that basis the borrowings have been classified as non-current. The
amounts drawn under the RCF bear interest based on SONIA, SOFR and EURIBOR
from amounts drawn in sterling, US dollars and euros respectively, plus a
credit margin dependent on the Group's leverage ratio. As at 28 February 2026,
the Group's net debt was £2.9 million (28 February 2025: £2.5 million net
debt) with available headroom in the £40.0 million RCF of £13.5 million (at
28 February 2025: £6.8 million) (net cash is calculated as cash less secured
RCF). All revolving credit facilities are drawn by Braemar Plc.
The directors consider that the fair value of the revolving credit facility
liability is equivalent to its carrying amount.
4.7 Convertible loan notes
The Group issued convertible loan notes in connection with its acquisition of
Naves in September 2017.
These convertible loan note instruments are unsecured, unlisted and
non-transferable. The notes are euro-denominated and carry a 3% per annum
coupon. Each tranche is redeemable on or after two years from the date of
issue by the Group or by the individual holder. The conversion prices were
fixed at 390.3 pence for management sellers and 450.3 pence for non-management
sellers.
The convertible loan note instruments carry certain accelerated conversion
rights in the event of default on financial commitments associated with the
instruments or business distress within the Group. The loan notes shall
automatically convert or be redeemed in the event that any person or persons
acting in concert hold more than 50% of the issued share capital of the Group
or an impairment charge in excess of £43.9 million (€50.0 million) is
reflected in the audited Financial Statements of the Group.
The convertible loan notes are considered to be a financial liability host
with an embedded derivative convertible feature which is required to be
separated from the host. The Group has an accounting choice to record the
instrument in its entirety at fair value through profit and loss but has not
chosen to apply this treatment. Instead, the financial liability host is
recognised as a euro liability initially recognised at fair value and
prospectively accounted for applying the effective interest rate method. As
the loan notes are denominated in euros, the conversion feature does not meet
the definition of an equity instrument. As a result, it is treated as a
separated embedded derivative and is recognised at fair value through profit
and loss. Where there are conversion options that can be exercised within one
year, the liability is recognised as current.
The embedded derivatives within the convertible loan notes are valued using
Level 3 hierarchy techniques under IFRS 13. See Note 4.4.
The final convertible loan notes were settled in the year and the Group has no
outstanding balance at the end of February 2026 (2025: £2.4 million). The
following table shows amounts in the Group balance sheet relating to the
convertible loan notes issued on the acquisition of Naves.
2026 2025
Represented in the Group Balance Sheet £'000 £'000
Current liabilities:
Convertible loan notes - 2,401
Derivatives - 29
- 2,430
The movement in the Naves-related balances in the Group Balance Sheet during
the year is explained by the items below:
2026 2025
£'000 £'000
Total Naves-related balances at start of year 2,430 3,118
Finance expense 93 201
Derivative gain (29) (111)
Foreign exchange loss/(gain) 140 (102)
Cash paid (2,634) (676)
Total movements (2,430) (688)
Total Naves-related balances at year-end - 2,430
The current year cash paid includes interest of £0.1 million (2025: £0.1
million).
The loan notes have the following maturities:
Accounting value Nominal value
2026 2025 2026 2025
£'000 £'000 €'000 €'000
Due at the reporting date
30 September 2025 - 2,401 - 2,929
- 2,401 - 2,929
Derivatives thereon - 29
Total liabilities on loan notes - 2,430
4.8 Reconciliation of liabilities from financing activities
RCF Convertible loan notes Lease Total
borrowings
liabilities
£'000
£'000 £'000
£'000
At 1 March 2025 22,936 2,401 9,245 34,582
Cash flows 3,500 (2,559) (2,913) (1,972)
Non-cash flows:
- Interest accruing in the period 111 18 - 129
- Fees paid reported as operating cash flows (37) - - (37)
- New leases - - 1,663 1,663
- Lease terminations - - (41) (41)
- Effects of foreign exchange (186) 140 6 (40)
At 28 February 2026 26,324 - 7,960 34,284
Current portion - - 3,555 3,555
RCF Convertible loan notes Lease Total
borrowings
liabilities
£'000
£'000 £'000
£'000
At 1 March 2024 26,966 2,978 4,778 34,722
Cash flows (4,000) (584) (3,106) (7,690)
Non-cash flows:
- Interest accruing in the period 121 109 - 230
- Fees paid reported as operating cash flows (123) - - (123)
- New leases - - 7,608 7,608
- Effects of foreign exchange (28) (102) (35) (165)
At 28 February 2025 22,936 2,401 9,245 34,582
Current portion - 2,401 2,733 5,134
4.9 Deferred and contingent consideration receivable
Contingent consideration receivable is initially recognised at fair value and
is subsequently remeasured at its fair value at each Balance Sheet date. The
resulting gain or loss is recognised immediately in the Income Statement.
Contingent consideration receivable is classified as Level 3 in accordance
with the fair value hierarchy specified by IFRS 13. Deferred consideration is
initially measured at its fair value and subsequently measured at amortised
cost less provision for impairment.
On 28 February 2022, the Group sold Cory Brothers to Vertom Agencies BV for
maximum consideration of £15.5 million. Initial cash proceeds of £6.5
million were received on completion of the transaction, and three contractual
"earnout" payments were due, being an agreed percentage of the future gross
profits of the combined VertomCory business over three subsequent twelve-month
earnout periods.
The minimum earnout consideration has been classified as deferred
consideration receivable. The minimum amount is specified in the SPA and is
therefore not an estimate; however, an estimate of a discount rate is
necessary to discount the deferred consideration receivable. A discount rate
of 2.39% was used to calculate the net present value; this was based on the
credit risk of Vertom Agencies BV following a credit check performed by
management. Deferred consideration receivable is initially recognised at fair
value and subsequently measured at amortised cost.
The balance of the earnout consideration, up to the maximum specified in the
SPA, has been classified as contingent consideration receivable because it is
contingent on the future profitability of the combined business. The fair
value of the contingent consideration receivable involves two critical
estimates: the future profitability of the combined business and the discount
rate used to calculate the net present value. The future profitability
forecasts are based on a business plan prepared by the combined VertomCory
business. Contingent consideration receivable is initially recognised at fair
value and subsequently measured at fair value through profit and loss.
The fair value of the contingent consideration is calculated using the
forecast gross profit for the combined VertomCory business for each earnout
period, applying the agreed percentage, deducting the minimum payment and
discounting the forecast contingent cashflows. The valuation of the
contingent consideration involves two estimates: the future profitability of
the combined business and the discount rate used to calculate the net present
value. The future profitability forecasts are based on a business plan
prepared by the combined VertomCory business and was reviewed by management as
part of the financial due diligence process. A discount rate of 5.51% was used
in 2025 to calculate the net present value; this was based on the credit risk
of Vertom Agencies BV.
Fair value of Cory Brothers deferred and contingent consideration receivable
The agreed minimum earnout payment is presented as deferred consideration and
measured at amortised cost, using a discount rate of 2.39% determined on
initial measurement. The uncertain element of each earnout payment is
measured at fair value through profit or loss and presented as contingent
consideration.
Deferred and contingent consideration are included in current other
receivables (see Note 4.2). The amortised cost of the deferred consideration
in 2025 was £1.3 million. The fair value of the contingent consideration was
£0.7 million. During the year, the Group received £2.0 million (2025: £1.8
million) which is included in the Group Cash Flow Statement with £1.7 million
(2025: £1.7 million) allocated to investing activities, £0.2 million (2025:
£nil) allocated to operating activities due to changes in fair value, and
£0.1 million (2025: £0.1 million) to interest received in relation to the
deferred consideration payment. No further payments are due in relation to the
sale of Cory Brothers.
5 Employee remuneration schemes
5.1 Long-term employee benefits
The Group has the following long-term employee benefits:
i) Defined contribution schemes
The Group operates a number of defined contribution schemes. Pension costs
charged against profits in respect of these schemes represent the amount of
the contributions payable to the schemes in respect of the accounting period.
The assets of the schemes are held separately from those of the Group within
independently administered funds. The Group has no further payment obligations
once the contributions have been paid.
ii) Defined benefit schemes
The Group operates a defined benefit scheme, the ACM Staff Pension Scheme (the
"Scheme"), with assets held separately from the Group. The cost of providing
benefits under the Scheme is determined using the projected unit credit
actuarial valuation method which measures the liability based on service
completed and allowing for projected future salary increases and discounted at
an appropriate rate.
The current service cost, which is the increase in the present value of the
retirement benefit obligation resulting from employee service in the current
year, and gains and losses on settlements and curtailments, are included
within operating profit in the Income Statement. The unwinding of the discount
rate on the Scheme liabilities which is shown as a net finance cost and past
service costs are presented and recognised immediately in the Income
Statement.
The pension asset or liability recognised on the Balance Sheet in respect of
this Scheme represents the difference between the present value of the Group's
obligations under the Scheme and the fair value of the Scheme's assets.
Actuarial gains or losses and return on plan assets net of tax, excluding
interest, are recognised in the period in which they arise within the
Statement of Comprehensive Income.
When the defined benefit plan is in a surplus, the asset is recognised at the
lower of the surplus and the asset ceiling, less any associated costs, such as
taxes payable.
iii) Other long-term benefits
The current service cost of other long-term benefits resulting from employee
services in the current year is included within the Income Statement. The
unwinding of any discounting on the liabilities is shown in net finance costs.
The Group operates a defined benefit scheme in the UK. A full actuarial
valuation was carried out as at 31 March 2023 and updated by the IAS 19
valuation as at 28 February 2026. All valuations have been carried out by a
qualified independent actuary.
The Group's obligations in respect of the funded defined benefit scheme at 28
February 2026 were as follows:
2026 2025
£'000 £'000
Present value of funded obligations 9,910 9,904
Fair value of scheme assets, net of tax (13,418) (12,452)
Total surplus of defined benefit pension scheme (3,508) (2,548)
Funded defined benefit scheme
The Group sponsors a funded defined benefit scheme (the ACM Staff Pension
Scheme) for qualifying UK employees. The Scheme is administered by a separate
board of Trustees which is legally separate from the Group. The Trustees are
composed of representatives of both the employer and employees. The Trustees
are required by law to act in the interest of all relevant beneficiaries and
are responsible for the investment policy with regard to the trust assets and
the day-to-day administration of benefits.
Under the Scheme, employees are entitled to annual pensions on retirement at
age 60 of 1/60th of final pensionable salary for each year of service.
Pensionable salary is defined as basic salary plus the average of the previous
three years' bonuses (capped at three times basic salary). Pensionable
salaries for members who joined after 1 June 1989 are also subject to an
earnings cap. Other benefits are payable, for example those provided on death.
The Scheme was closed to future accrual and from 1 February 2016,
post-retirement benefits are provided to these employees through a separate
defined contribution arrangement.
Profile of the Scheme
The defined benefit obligation includes benefits for current employees, former
employees, and current pensioners. Broadly, around 50% of the liabilities are
attributable to deferred pensions for current and former employees, with the
remaining 50% to current pensioners.
The Scheme duration is an indicator of the weighted average time until benefit
payments are made. For the Scheme as a whole, the duration is around 14 years
(2025: 14 years).
Funding implications
UK legislation requires that pension schemes are funded prudently. The most
recent funding valuation of the Scheme was carried out by a qualified actuary
as at 31 March 2023 and showed a surplus of £0.3 million.
Risks associated with the Scheme
The Scheme exposes the Group to a number of risks, the most significant of
which are:
Asset volatility
The liabilities are calculated using a discount rate set with reference to
corporate bond yields; if assets underperform this yield, this will create a
deficit. The Scheme holds a significant proportion of growth assets which,
though expected to outperform corporate bonds in the long term, create
volatility and risk in the short term. The allocation to growth assets is
monitored to ensure it remains appropriate given the Scheme's long-term
objectives.
Changes in bond yields
An increase in corporate bond yields will decrease the value placed on the
Scheme's liabilities for accounting purposes, although this will be partially
offset by a decrease in the value of the Scheme's bond holdings.
Inflation risk
A proportion of the Scheme's benefit obligations are linked to inflation and
higher inflation will lead to higher liabilities (although, in most cases,
caps on the level of inflationary increases are in place to protect against
extreme inflation). The majority of the assets are either unaffected by or
only loosely correlated with inflation, meaning that an increase in inflation
will also increase the deficit.
Life expectancy
The majority of the Scheme's obligations are to provide benefits for the life
of the member, so increases in life expectancy will result in an increase in
Scheme liabilities.
The Company and Trustees have agreed a long-term strategy for reducing
investment risk as and when appropriate. This includes moving assets to match
pensioner liabilities when members reach retirement.
The Trustees insure certain benefits payable on death before retirement.
The principal assumptions used for updating the latest valuation of the Scheme
were:
2026 2025
(% p.a.) (% p.a.)
Discount rate 5.5 5.3
CPI inflation 2.5 2.6
Pension and deferred pension increases:
CPI capped at 2.5% p.a. 2.3 2.3
CPI capped at 5.0% p.a. 2.5 2.6
2026 2025
Years Years
Life expectancy from age 60 for:
Current 60-year-old male 26.1 25.6
Current 60-year-old female 28.7 28.1
Post-retirement mortality S2 PXA, CMI 2024 (min 1.25%)
Early retirement No allowance for early retirement
Withdrawals from active service No allowance
Cash commutation 80% of members assumed to take maximum lump sum (2025: 80%)
All members are assumed to retire at age 60.
The Scheme's assets are split by type of asset in the following table.
Scheme assets (before expected tax charge on recovery) 2026 2025
£'000 £'000
Scheme assets are comprised as follows:
Overseas equities 966 1,387
High yield debt - 45
Cash 360 395
Inflation-linked bonds 1,089 1,057
Corporate bonds 2,393 2,187
Government bonds 770 728
Diversified growth funds 9,010 7,503
Total 14,588 13,302
The Pension Scheme assets do not include any ordinary shares issued by the
Company. All assets are held through pooled investment vehicles.
Expense recognised in the Income Statement (included in operating costs) 2026 2025
£'000 £'000
Interest income on net asset/liability (180) (109)
Income recognised in Income Statement (180) (109)
Remeasurements in other comprehensive expense:
Gain on assets in excess of that recognised in net interest (982) (277)
Actuarial gains due to changes in financial assumptions (353) (693)
Actuarial loss due to changes in demographic assumptions 158 27
Actuarial loss/(gain) due to liability experience 77 (171)
Expected tax charge on recovery of assets 320 89
Gain recognised in other comprehensive income (780) (1,025)
Total amount recognised in Income Statement and other comprehensive expense (960) (1,134)
Changes to the present value of the defined benefit obligation are analysed as
follows:
2026 2025
£'000 £'000
Opening defined benefit obligation 9,904 10,609
Interest expense 525 530
Actuarial gains due to changes in financial assumptions (353) (693)
Actuarial loss/(gain) due to changes in demographic assumptions 158 27
Actuarial (gain)/loss due to liability experience 77 (171)
Net benefit payments from Scheme (401) (398)
Closing value at 28 February 9,910 9,904
Changes in the fair value of plan assets are analysed as follows:
2026 2025
£'000 £'000
Opening fair value at 1 March 12,452 12,023
Interest income 705 639
Fair value gain/(loss) on assets 982 277
Contributions by employers - -
Net benefit payments from Scheme (401) (398)
Expected tax charge on recovery of assets (320) (89)
Closing value at 28 February 13,418 12,452
The Group does not expect to make any contributions to the Scheme in the next
twelve months.
Actual return on Scheme assets 2026 2025
£'000 £'000
Interest income on plan assets 705 639
Remeasurement gain/(loss) on assets 982 277
Actual return on assets 1,687 916
Sensitivity analysis
The table below illustrates the sensitivity of the Scheme liabilities at 28
February 2026 to changes in the principal assumptions. The sensitivities
assume that all other assumptions remain unchanged and the calculations are
approximate (full calculations could lead to a different result).
Change in assumption Approximate increase in liabilities Approximate increase in liabilities
%
£'000
Interest rate reduced by 0.5% p.a. 9.0 892
Inflation assumption increased by 0.5% p.a.(1) 5.9 585
Increase in life expectancy of one year for all members reaching 60 2.5 248
(1)The inflation assumption sensitivity applies to both the assumed rate of
increase in the CPI and the RPI, and includes the impact on the rate of
increases to pensions, both before and after retirement.
Defined contribution schemes
There are a number of defined contribution schemes in the Group, the principal
scheme being the Braemar Pension Scheme, which is open to all UK employees.
Cash contributions paid into the defined contribution schemes are accounted
for as an Income Statement expense as they are incurred. The total charge for
the year in respect of this and other defined contribution schemes amounted to
£2,048,000 (2025: £1,967,000) which was in respect of continuing operations.
Contributions of £212,927 were due to these schemes at 28 February 2026
(2025: £190,000).
The assets of these schemes are held separately from those of the Group in
funds under the control of the Trustees.
5.2 Share-based payments
The Group operates a number of equity-settled share-based payment schemes.
No awards may be granted under the schemes set out below which would result in
the total number of shares issued or remaining issuable under all of the
schemes (or any other Group share schemes), in the ten-year period ending on
the date of grant of the option, exceeding 10% of the Company's issued share
capital (calculated at the date of grant of the relevant option).
All of the Group's share schemes are accounted for as equity-settled
share-based payments because they only entitle the employee to receive equity
instruments issued by the Parent Company. The Group may provide a net
settlement feature, whereby it withholds the number of equity instruments
equal to the monetary value of the employee's tax obligation arising from the
exercise (or vesting) of the award of the total number of shares that
otherwise would have been issued to the employee. The Group has no contractual
obligation to provide a net settlement option, and therefore the award is
still accounted for as an equity-settled award in full and the value of the
shares foregone by the employee is accounted for as a deduction from equity.
Occasionally the Group, at its discretion, might repurchase vested equity
instruments. In accordance with IFRS 2, such payments to employees are
accounted for as a deduction from equity, except to the extent the payment
exceeds the fair value of the equity instruments repurchased.
The net cost of the shares acquired for the shares held by the ESOP and the
EBT are a deduction from shareholders' funds and represent a reduction in
distributable reserves. Note 6.3 provides detail on the ESOP and the EBT and
movements in shares to be issued.
Key estimate
Share option vesting
The fair value determined at the grant date of the equity-settled share-based
payments is typically expensed on a straight-line basis over the vesting
period, based on the Group's estimate of the number of equity instruments that
will eventually vest. At each reporting date, the Group revises its estimate
of the number of equity instruments expected to vest as a result of the effect
of non-market-based vesting conditions. The impact of the revision of the
original estimates, if any, is recognised in the Income Statement such that
the cumulative expense reflects the revised estimate, with a corresponding
adjustment to reserves.
A 5% decrease in the forfeiture assumption during FY26 would result in an
additional charge of £0.4 million (2025: £0.5 million) to the Income
Statement, while a 5% increase in the forfeiture assumption during FY26 would
result in a reduced charge of £0.4 million (2025: £0.7 million). While the
Group believes that a change in estimate of 5% or greater for all awards in
any one year is unlikely, due to the fact that the value of awards are not
uniform between employees, the Group believes that there is a significant risk
that a revision to the forfeiture estimate could result in a material impact
to the Income Statement in the next financial year depending on the profile of
leavers.
Deferred Bonus Plan ("DBP")
The Company adopted a Deferred Bonus Plan in May 2020 (the "2020 DBP"),
pursuant to which future discretionary bonus awards will be granted to staff
including executive directors. Awards under the new DBP may be linked to an
option granted under the new Braemar Company Share Option Plan 2020, which was
also adopted by the Company in May 2020 (the "2020 CSOP"). Where an employee
receives a linked award under the 2020 DBP, if the Company's share price rises
over the vesting period, the 2020 CSOP award can be exercised with the value
of shares delivered on the vesting of the 2020 DBP award being reduced by the
exercise gain on the 2020 CSOP award. Awards under the 2020 DBP and the 2020
CSOP may be settled by the issue of new shares by way of transfer of shares
from the ESOP. Historical practice has been to settle via the transfer of
shares from the ESOP and it is the current intention to continue to operate in
this manner.
The number of awards granted under the Deferred Bonus Plan each year is
related to the profits generated in the previous year. The cost of the award
is therefore expensed from the beginning of that profit period until the
vesting date which is usually three years after the date of award and is
subject to continued employment. Awards made to new joiners are expensed
over the period from date of joining to date of vesting. Their fair value is
estimated based on the share price at the time of grant less the expected
dividend to be paid during the vesting period. The number of awards which are
expected to vest is estimated by management based on levels of expected
forfeitures.
Long Term Incentive Plan ("LTIP")
The Company also operates an LTIP, which was approved by shareholders and
adopted in 2014. LTIP awards under this plan take the form of a conditional
right to receive shares at £nil cost. The awards normally vest over three
years and are typically subject to a performance condition such as earnings
per share ("EPS") or Total Shareholder Return ("TSR"), a market-based
condition.
The fair value of awards with the EPS condition are non-market conditions and
their fair value is estimated based on the share price at the time of grant
less the expected dividend to be paid during the vesting period. The fair
value of awards containing market conditions is determined using Monte Carlo
simulation models. The number of awards which are expected to vest is
estimated by management based on levels of expected forfeitures and the
expected outcome of the EPS condition. For awards subject to market
conditions, no adjustment is made to reflect the likelihood of the market
condition being met nor the actual number of awards which lapse as a result of
the condition not being met.
The Company operates a variety of share-based payment schemes which are listed
below.
a) Deferred Bonus Plan
Details of the share awards in issue and the movements in the year are given
below:
Share scheme Number at Granted Exercised Forfeited Number at Exercise price (pence) Exercisable
1 March 28 February
2025 2026
Jun-21 5,179 - (5,005) (174) - nil Jun 2025
Sep-22 768,634 - (677,817) (90,817) - nil Jun 2025
Jan-23 341,543 - (338,138) (3,405) - nil Jun 2025
Feb-23 121,944 - (107,439) (14,505) - nil Jun 2025
Dec-23 1,624,371 - (140,455) (242,943) 1,240,973 nil Jul 2024 - Jul 2026
Jul-24 2,051,729 - - (722,731) 1,328,998 nil Jul 2027
Feb-25 - 132,873 (6,825) - 126,048 nil Feb 2028
Nov-25 - 105,000 - - 105,000 nil Aug 28 - Nov 28
Dec-25 - 27,778 - - 27,778 nil Dec 2028
Total 4,913,400 265,651 (1,275,679) (1,074,575) 2,828,797
The weighted average share price on exercise for awards exercised during the
year was £2.11 (2025: £2.89). The weighted average share price at grant date
for awards granted during the year was £2.48 (2025: £2.97).
Under the DBP, sufficient shares to satisfy each award are bought over the
course of the vesting period and held in an employee trust ("ESOP") until
vesting. As at 28 February 2026, the ESOP held 1,080,697 ordinary shares
(2025: 1,583,460 ). The ESOP holding is in line with expectations of how
many shares will be needed, along with the time to acquire them, to satisfy
the current awards under this scheme. This amount is net of expected lapses in
the scheme and the fact that recipients typically forego sufficient shares in
order to satisfy the associated tax liability that arises on their vesting.
b) Long-Term Incentive Plan ("LTIP")
The Company also has LTIP awards, which allow for the form of a conditional
right to receive shares at £nil cost. The awards normally vest over three
years and are subject to various performance conditions based on earnings per
share ("EPS") or segmental operating profit.
Details of the LTIP share awards in issue and the movements in the year are
given below:
Share scheme Number at Granted Exercised Lapsed Number at Exercisable
1 March 28 February between
2025 Forfeited 2026
LTIP 2020 375,000 - (156,250) - - 218,750 Jul 25 - Jul 30
LTIP 2022 (granted FY23) 493,945 - - (234,429) (259,516) - Jul 27 - Jul 32
LTIP 2023 369,958 - - - (133,452) 236,506 Dec 28 - Dec 33
LTIP 2024 394,560 - - - (125,923) 268,637 Jul 29 - Jul 34
LTIP 2025 - 416,030 - - - 416,030 Jul 30 - Jul 35
Total 1,633,463 416,030 (156,250) (234,429) (518,891) 1,139,923
The weighted average share price at grant date for awards granted during the
year was £2.20 (2025: £2.97). The weighted average share price on exercise
for awards exercised during the year was £2.43 (2025: £2.46).
The value of the awards is recognised as an expense over the period from the
date of grant to the vesting date. The awards are satisfied by the issue of
new shares.
c) Other share-based payments
On 5 December 2022, 253,434 shares were awarded as a joining incentive to
certain employees of Madrid Shipping Advisors SL and on 16 December 2022,
1,016,121 shares were issued to the former owners of Southport as part of the
acquisition. In addition, on the acquisition of Southport, a further 872,821
shares were awarded to key employees of Southport. The fair value of the
awards is determined based on the share price at the time of grant less the
expected dividend to be paid during the three-year vesting period calculated
using the market consensus dividend yield.
The value of the awards is recognised as an expense over the period from the
date of grant to the vesting date. The Southport Maritime Inc. awards will be
satisfied by the issue of new shares.
Share award Number at Granted Exercised Lapsed Number at Vesting
1 March 28 February
2025 Forfeited 2026
Southport Maritime Inc. 1,888,942 - (1,888,942) - - - Dec 25
Madrid Shipping Advisors SL 84,478 - (84,478) - - - Dec 23 - Dec 25
6 Share capital and other reserves
6.1 Share capital
Ordinary shares Ordinary shares
2026 2025 2026 2025
Number Number £'000 £'000
Authorised
Ordinary shares of 10 pence each 34,903,000 34,903,000 3,490 3,490
Ordinary shares Ordinary shares Share premium
2026 2025 2026 2025 2026 2025
Number Number £'000 £'000 £'000 £'000
Issued
Fully paid ordinary shares of 10 pence each
As at start of year 32,924,877 32,924,877 3,292 3,292 - -
Shares cancelled (873,395) - (87) - - -
Shares issued and fully paid (see below) 1,016,121 - 102 - - -
As at end of year 33,067,603 32,924,877 3,307 3,292 - -
During the year, the Company purchased 873,395 shares from the market and
immediately cancelled them. The total consideration paid for the shares was
£2.0 million. No shares remained unpaid at 28 February 2026 or 28 February
2025. The Company has one class of ordinary shares which carry no right to
fixed income.
6.2 Dividends
Amounts recognised as distributions to equity holders in the year:
2026 2025
£'000 £'000
Ordinary shares of 10 pence each
Final dividend of 2.5 pence per share for the year ended 28 February 2025 paid 787 2,862
on 8 September 2025 (2025: 9.0 pence per share for the year ended 29 February
2024 paid on 9 September 2024)
Interim dividend of 2.5 pence per share paid on 13 January 2026 766
Interim dividend of 4.0 pence per share paid on 2 April 2024 - 1,222
Interim dividend of 4.5 pence per share paid on 13 January 2025 - 1,413
1,553 5,497
The right to receive dividends on the shares held in the ESOP has been waived
(see Note 6.3). The dividend saving through the waiver was £0.1 million
(2025: £0.1 million).
For the year ended 28 February 2026, a final ordinary dividend of 4.5 pence
per share has been proposed totalling £1.4 million.
6.3 ESOP reserve
An Employee Share Ownership Plan ("ESOP") was established on 23 January 1995.
The ESOP has been set up to purchase shares in the Company. These shares, once
purchased, are held in trust by the Trustee of the ESOP, SG Kleinwort Hambros
Trust Company (CI) Limited, for the benefit of the employees. Additionally,
an Employee Benefit Trust ("EBT") previously run by ACM Shipping Group plc
also holds shares in the Company. During the prior year, the Group completed
the process of winding up the EBT with the shares held being sold in the
market.
The ESOP reserve represents a deduction from shareholders' funds and a
reduction in distributable reserves. The deduction equals the net purchase
cost of the shares held in trust by the ESOP. Shares allocated by the ESOP
to satisfy share awards issued by the Group are released at cost on a first in
first out basis.
£'000
At 29 February 2024 7,140
Disposal of EBT shares (521)
Shares acquired by the ESOP 2,376
ESOP shares allocated (4,661)
At 28 February 2025 4,334
Shares acquired by the ESOP 4,141
ESOP shares allocated (5,970)
At 28 February 2026 2,505
As at 28 February 2026, the ESOP held 1,080,697 (2025: 1,583,460) ordinary
shares of 10 pence each. The funding of the purchase has been provided by the
Company in the form of a gift and the Trustees have contracted with the
Company to waive the ESOP's right to receive dividends. The fees charged by
the Trustees for the operation of the ESOP are paid by the Company and charged
to the Income Statement as they fall due.
The total cost to the Company of shares held in the ESOP at 28 February 2026
was £2.5 million (2025: £4.3 million) including stamp duty associated with
the purchases. The shares owned by the ESOP had a market value at 28 February
2026 of £2.3 million (2025: £4.2 million). The distribution of these shares
is determined by the Remuneration Committee.
2,299,745 shares (2025: 1,600,095) have been released to employees during the
year. The shares acquired by the ESOP during the year had an aggregate cost
of £4.1 million (2025: £2.4 million).
6.4 Other reserves
Capital Merger Foreign Hedging Total
redemption
reserve
currency
reserve
£'000
reserve
£'000
translation
£'000
£'000
reserve
£'000
At 29 February 2024 - 4,886 2,490 989 8,365
Cash flow hedges:
- Transfer to income statement - - - (1,500) (1,500)
- Fair value gains/losses in the period - - - (101) (101)
Investment hedge - - (19) - (19)
Exchange differences - - 295 - 295
Deferred tax on items taken to equity - - - 400 400
At 28 February 2025 - 4,886 2,766 (212) 7,440
Cash flow hedges:
- Transfer to income statement - - - (3,376) (3,376)
- Fair value gains/losses in the period - - - 5,911 5,911
Share repurchase and cancellation 87 - - - 87
Investment hedge - - 263 - 263
Exchange differences - - (1,255) - (1,255)
Recycling foreign currency translation reserve for Company strike off - - 58 - 58
Deferred tax on items taken to equity - - - (650) (650)
At 28 February 2026 87 4,886 1,832 1,673 8,478
The capital redemption reserve arose on share buy-backs and cancellation of
those shares by the Company. The merger reserve arose on transactions where
the Company issued shares pursuant to an arrangement to acquire more than a
90% interest in another company and no share premium was recorded. The amounts
in the merger reserve are unrealised profits relating to the corresponding
assets acquired by the Company on the issue of shares. These profits may
become realised on the disposal or write-down of these assets.
The hedging reserve comprises the effective portion of the cumulative net
change in fair value of cash flow hedging instruments relating to hedged
transactions that have not yet occurred. The deferred tax movement recognised
in equity in the year was a loss of £0.7 million (2025: £0.4 million gain).
7 Other supporting notes
7.1 Provisions
Provisions are recognised when the Group has a present obligation (legal or
otherwise) as a result of a past event and it is probable that an outflow of
resources embodying economic benefits will be required to settle the
obligation and a reliable estimate can be made of the amount of the
obligation. If material, the provisions are discounted using an appropriate
current post-tax interest rate.
Short-term provisions for long service leave expected to be settled wholly
within twelve months of the reporting date are measured at the amounts
expected to be paid when the liabilities are settled.
The provision for long service leave not expected to be settled within twelve
months of the reporting date is measured at the present value of expected
future payments to be made in respect of services provided by employees up to
the reporting date. Consideration is given to expected future wage and salary
levels, experience of employee departures and periods of service. Expected
future payments are discounted using market yields at the reporting date on
corporate bonds with terms to maturity and currency that match, as closely as
possible, the estimated future cash outflows.
Uncertain commission obligations
In June 2023, the board commissioned an independent internal investigation
into an historical transaction originating in 2013. The investigation was
overseen by an Investigation Committee chaired by the Group's non-executive
Chairman and was conducted by an independent specialist forensic accounting
firm, and independent external counsel. The investigation was comprehensive
and complex and ultimately encompassed several transactions between 2006 and
2013 which required further investigation.
As a result of the investigation, the Group recognised a provision of £2.0
million in relation to the uncertain obligations connected to a number of the
transactions and commission obligations identified as part of the
investigation. An adjustment to reduce the provision by £0.1 million was made
in the prior year and the full amount of the provision was utilised during the
current year. While the board cannot forecast with certainty final outcomes in
respect of these obligations, based on the Group's current information, the
board believes that no further provision is required.
Dilapidations Uncertain commission obligation Other Total
£'000
£'000
£'000
£'000
At 29 February 2024 605 2,094 439 3,138
Provided in the year 455 - 164 619
Utilised in the year - - (208) (208)
Reversal of provision in the year - (88) - (88)
Exchange differences 2 (3) (1) (2)
At 28 February 2025 1,062 2,003 394 3,459
Provided in the year 44 - 128 172
Utilised in the year (9) (1,907) - (1,916)
Reversal of provision in the year (6) - - (6)
Exchange differences (14) (96) (25) (135)
At 28 February 2026 1,077 - 497 1,574
Current 28 - 497 525
Non-current 1,049 - - 1,049
At 28 February 2026 1,077 - 497 1,574
Dilapidations relate to future obligations to make good certain office
premises upon expiration of the lease term. The provision is calculated with
reference to the location and square footage of the office.
Employee entitlements of £0.5 million (2025: £0.4 million) are included in
other, which relate to statutory long service leave in Braemar Shipbroking Pty
Limited. This is based on the principle that each Australian employee is
entitled to eight weeks of leave over and above any annual leave on completion
of ten years' continuous service. The provision is calculated with reference
to the number of employees who have at least seven years of continuous
service.
7.2 Contingent liabilities
From time to time the Group may be engaged in litigation in the ordinary
course of business. The Group carries professional indemnity insurance. There
are currently no liabilities expected to have a material adverse financial
impact on the Group's consolidated results or net assets.
7.3 Related party transactions
Transactions with wholly owned subsidiaries
Transactions between the Company and its subsidiaries, which are related
parties, have been eliminated on consolidation and are not disclosed in this
Note.
7.4 Events after the reporting date
A proposed final dividend for the year ended 28 February 2026 of 4.5 pence per
share, totalling £1.4 million, has been recommended by the directors. This is
subject to shareholder approval. There were no other adjusting or significant
non-adjusting events between the reporting date and the date these Financial
Statements were authorised for issue.
Five-year Financial Summary (Unaudited)
Consolidated Income Statement
Continuing operations 12 months to 12 months to 12 months to 12 months to 12 months to
28 Feb 2026
28 Feb 2025
29 Feb 2024
£'000
£'000
£'000 28 Feb 2023 28 Feb 2022
£'000
£'000
Group revenue 135,614 141,860 152,751 152,911 101,310
Other operating expenses (123,191) (126,263) (136,203) (132,836) (91,250)
Specific items (net) (4,734) (4,424) (7,504) (8,406) (514)
Total operating expenses, net of other incomes (127,925) (130,687) (143,707) (141,242) (91,764)
Operating profit/(loss) 7,689 11,173 9,044 11,669 9,546
Gain on revaluation of investment - - - - 172
Net interest expense (3,275) (1,951) (1,533) (2,195) (1,156)
Gain on disposal of associate / share of associate profit for the period 217 - 12 (23) (19)
Profit before taxation 4,631 9,222 7,523 9,451 8,543
Taxation (2,354) (3,120) (2,899) (4,855) (1,839)
Gain/(loss) for the year from discontinued operations - - - - 7,215
Profit/(loss) after taxation 2,277 6,102 4,624 4,596 13,919
Dividends
Interim 766 1,413 1,222 1,172 610
Final proposed 1,439 787 2,862 2,440 2,254
2,205 2,200 4,084 3,612 2,864
Earnings per ordinary share - pence
Basic - underlying from continuing operations 24.23p 31.30p 36.62p 46.22p 23.06p
Diluted - underlying from continuing operations 21.28p 26.74p 29.96p 38.52p 18.79p
Five-year Financial Summary (Unaudited)
Consolidated Balance Sheet
As at As at As at As at As at
28 Feb 2026
28 Feb 2025
29 Feb 2024
£'000
£'000
£'000 28 Feb 2023 28 Feb 2022
(restated)
£'000
£'000
(restated)
Assets
Non-current assets
Goodwill 71,401 71,243 71,337 71,407 79,891
Other intangible assets 2,050 2,608 3,185 3,980 997
Property, plant and equipment 8,823 10,135 5,582 5,320 7,078
Other investments 1,443 1,720 1,633 1,780 1,780
Investment in associate - 713 713 701 724
Derivative financial instruments - 205 249 30 8
Deferred tax assets 2,131 3,368 2,979 4,794 3,713
Pension surplus 3,508 2,548 1,414 1,120 -
Other long-term receivables 720 1,768 4,589 8,554 5,636
90,076 94,308 91,681 97,686 99,827
Current assets
Trade and other receivables 39,212 40,887 37,730 43,323 35,792
Financial assets - - - - -
Derivative financial instruments 2,027 192 1,287 1,224 54
Current tax receivable 733 1,554 2,925 973 -
Assets held for sale - - - - -
Cash and cash equivalents 23,363 20,477 27,951 34,735 13,964
65,335 63,110 69,893 80,255 49,810
Total assets 155,411 157,418 161,574 177,941 149,637
Liabilities
Current liabilities
Derivative financial instruments 51 592 315 1,447 688
Trade and other payables 37,329 34,732 43,611 57,310 39,183
Current tax payable 1,385 1,659 1,625 4,141 1,608
Provisions 525 2,433 3,080 2,575 486
Convertible loan notes - 2,401 2,978 3,001 1,416
Liabilities directly associated with assets classified as held for sale - - - - -
39,290 41,817 51,609 68,474 43,381
Non-current liabilities
Long-term borrowings 30,729 29,448 29,819 29,919 28,331
Deferred tax liabilities 188 358 8 344 -
Derivative financial instruments - 116 43 697 335
Trade and other payables 1,049 1,026 58 542 -
Provisions 1,798 498 416 734 797
Convertible loan notes - - - 550 2,755
Deferred consideration - - - - 495
Pension deficit - - - - 2,052
33,764 31,446 30,344 32,786 34,765
Total liabilities 73,054 73,263 81,953 101,260 78,146
Total assets less total liabilities 82,357 84,155 79,621 76,681 71,491
Equity
Share capital 3,307 3,292 3,292 3,292 3,221
Share premium - - - 53,796 53,030
ESOP reserve (2,505) (4,334) (7,140) (10,607) (6,771)
Other reserves 8,478 7,440 8,365 28,819 26,130
Retained earnings 73,077 77,757 75,104 1,381 (4,119)
Total equity 82,357 84,155 79,621 76,681 71,491
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