Brand Architekts Grp - Final Results
21/10/2024 07:00
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20241021:nRSU8595Ia&default-theme=true
RNS Number : 8595I Brand Architekts Group PLC 21 October 2024
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF
REGULATION 2014/596/EU (WHICH FORMS PART OF DOMESTIC UK LAW PURSUANT TO THE
EUROPEAN UNION (WITHDRAWAL) ACT 2018 (THE "EUWA")) ("UK MAR"). UPON THE
PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION (AS DEFINED IN UK
MAR) IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.
Brand Architekts Group plc
("Brand Architekts" or the "Group")
Final Results
Brand Architekts Group plc, a market leader in the development and supply of
beauty and personal care brands, announces its Full Year results to 30 June
2024.
Business highlights:
Strategic focus on fewer, bigger, solution-led margin accretive brands,
rationalising the portfolio to 8 key focus brands.
· Super Facialist grew by 17%, fuelled by distribution gains, notably Holland
& Barrett.
· Skinny Tan's Body Glow launched into Boots, Superdrug, Asda and Tesco. Body
Glow is now the fastest growing value sku in the UK tanning category (Circana
latest 12 weeks ending 8 July 24).
· Dirty Works launched in 750 Watsons stores in 9 countries, with encouraging
sell out results. FY25 brand refresh will focus on all year-round gifting and
a sub range called Mood Magic.
· The Solution's net sales were up 43%. The Solution Menopause range launched
on its own website in June 2024 and rolled out to Amazon in July 24. The
Solution Haircare range is planned to launch in Q3 FY25.
· Net sales of Root Perfect grew +14%, driven by strong UK demand for
affordable hair colourants and a pan European distribution expansion across
Normal stores.
· The number of live skus across the Group portfolio was reduced by 19% to
248, whilst net inventory reduced by £1.4m.
Financial Highlights:
· Sales for FY24 were £17.0m (down 15% on 2023: £20.1m) due to a planned
brand rationalisation programme, as well as challenging trading conditions in
the UK caused by a cost-of-living crisis and an unseasonably wet spring and
early summer.
· Gross profit margins increased by 1.5% to 41.2% (2023: 39.7%).
· Underlying operating loss of £0.4m, was £0.8m lower than the prior year
(2023: £1.2m operating loss) - better targeted advertising & promotions,
and the benefit of a full year of operational synergies.
· The decreased loss before taxation of £1.4m (2023: £6.8m) reflects a
reduced operating loss of £0.8m, together with a reduction in exceptional
items (Innovaderma goodwill impairment of £3.5m, legal fees of £0.7m and IDP
restructuring costs £0.4m).
· The Group retains a strong net cash position of £7.0m at the year-end
(30 June 2023: £8.2m). £1.0m outflow for the acquisition of MR and the
resolution of the legal claims & costs relating to the Fish acquisition in
2018.
2024 2023
Reported results from continuing operations
Revenue (Note 2) £17.0m £20.1m
Underlying operating (loss) (1) £(0.4)m £(1.2)m
Loss before taxation £(1.4)m £(6.8)m
Basic (loss)per share (5.2)p (23.5)p
Net cash £7.0m £8.2m
¹ Underlying operating loss is calculated before
exceptional items, share-based payments and amortisation of
acquisition-related intangibles.
Quentin Higham, Chief Executive, commented:
"The Group made good progress in rationalising its portfolio, whilst improving
margins and significantly reducing its underlying operating losses. We expect
to grow our brands through increased consumer awareness, investment in
customer acquisition campaigns; product productivity; an extensive NPD
pipeline planned for H2; the repositioning of Skinny Tan as Skin & Tan and
international expansion. We will continue to focus on brand contribution and a
further release of working capital tied up in harvest brands. We remain
confident that the foundations we are building will enable us to return to
profitability and achieve our medium and long-term goals."
For further information please contact:
Brand Architekts Group PLC
Quentin Higham / Geoff Ellis
Singer Capital Markets (Nominated adviser and broker) 020 7496 3000
Shaun Dobson / Jen Boorer
Chairman's Statement
The Group continues to successfully deliver its portfolio rationalisation
program and exit underperforming & unprofitable brands. Whilst this has
led to a 15% decline in net sales (£17.0m v FY23 £20.1m) this process is in
line with our strategy to focus on fewer, bigger, solution-led margin
accretive brands. This has allowed us to release working capital tied up in
non-strategic brands allowing us to target investment into our Invest brands.
A number of our brands saw good growth this year, with Super Facialist net
sales up 17%; Root Perfect grew 14%; Fish grew by 24% and The Solution grew
by 43%. Despite this the company has faced well documented, challenging, wider
market conditions, in particular the cost-of-living crisis, severely affected
the UK's premium self-tan category and resulted in double digit decline across
the premium self-tan category. Skinny Tan was adversely affected in its UK
offline and DTC channels, accounting for 42% of the overall net sales decline.
Skinny Tan Net sales for the year in the UK were down 27%. In H2 the excellent
growth we have seen in Dirty Works sales in Watsons across Asia was offset by
a softening in sales in TJ Maxx so that Dirty Works sales were down 16%. The
exit of underperforming brands & categories (i.e. Happy Naturals; Kind
Natured, Christmas Gift exclusives) resulted in a £1.1m revenue decline.
However, our strategic intent remains to grow our key Invest and Nurture
brands.
I was pleased that the business has continued to focus on reducing underlying
operating losses, which reduced from a £1.2m loss last year to a £0.4 loss
in the year under review. The significant improvement on the prior year, was
as a result of improved operational efficiencies, in particular, more
effective use of targeted advertising and promotions, as well as a continued
focus on cost control with actions taken to reduce staff costs and other
overheads.
Central Plc. costs were reduced by 38% and now account for 15% of the overall
group manpower and overhead costs. This was in part due to the one term
benefit of releasing historical Executive cash settled LTIPs, but also strong
cost management. I was particularly pleased that April 2023's triennial
valuation of the closed defined benefit pension plan resulted in a significant
reduction in the deficit recovery plan, under which we have a commitment to
make payments of £318,000 per annum until 30(th) June 2033.
The Group closed the year with net cash of £7.0m, which although a £1.2m
decline year on year, reflected the £1.0m outflow for the acquisition of MR
and the resolution of the long term historical legal claims and associated
costs.
We remain focused on realising both the strategic and financial aims of the
Group. In line with our Brand Development strategic tenet, immediate
priorities are on driving brand awareness on Skinny Tan and Super Facialist,
with an expected year-on-year increase in digital awareness and acquisition
campaigns - with more investment in TikTok and Influencers. This will address
rate-of-sale (ROS) challenges. I am also very excited by the repositioning of
Skinny Tan as Skin & Tan, which will filter through from November 2024
through to Spring 2025.
Historically we have done a very good job in securing new distribution, but to
maintain these listings requires necessary advertising and promotional
(A&P) spend to generate the appropriate ROS to maintain these listings. It
is therefore vital that we further invest into A&P and work tirelessly on
implementing our brand development strategic tenets.
Good progress has been made on new product development, brand launches and
relaunches and distribution gains, which are in line with our problem-solving
strategy and therefore gives a degree of confidence for the future.
Key highlights include:
· Super Facialist grew by 17%, fuelled by distribution gains, in
particular in Holland & Barrett in Q2. The brand's design upgrade started
to enter stores during Q4. Super Facialist's New Vegan Collagen line and New
Sleep Smart Night Moisturisers launched into Boots in July 24. Significant
increase in digital awareness campaigns is planned throughout the new year to
support ROS.
· In response to market trends and consumers' switch to more
affordable gradual tanners, Skinny Tan's Body Glow launched into Boots,
Superdrug, Asda and Tesco. As a result, Body Glow sku is now the fastest
growing value sku in the UK tanning category (Circana latest 12 weeks ending 8
July 24). Skinny Tan launched as a Boots exclusive in all its international
stores across six Gulf countries in Q3 and launched into Morrisons in July 24.
The Skin & Tan relaunch strategy has been well received by existing
customers and we have a secured pipeline of exciting Face Glow NPD planned for
the next tanning season. Targeted Investment will continue to be made into new
aspirational digital assets, and we will be investing into more digital
awareness campaigns throughout the year. We are working with our American
distributor to accelerate growth in the US, and we are also working with their
European arm to launch Skin & Tan across Amazon Europe.
· Dirty Works launched in 750 Watsons stores in 9 countries, with
very encouraging sell out results in Thailand, Turkey, Malaysia, the Gulf,
Singapore and Hong Kong. The brand refresh with a focus on all year-round
gifting, the signature range and new products should lead to further
distribution opportunities domestically and internationally.
· The Solution's net sales were up 43%. The Solution Menopause
range launched on its own website in June 2024 and rolled out to Amazon in
July 24. The range is succinct; meets important consumer needs- states; has
excellent empirical consumer panelling and encapsulates our company vision.
The Solution Haircare range is planned to launch in Q3 FY25.
· Net sales of Root Perfect, a key Harvest brand, continued to
outperform last year +14%, driven by strong UK demand for affordable hair
colourants and a pan European expansion across Normal stores and an improved
pricing strategy in Morrisons. The objective is to replicate this success with
other key European retailers.
· We have pivoted MR Expert Solutions' route to market, so that we are
focused on building a male problem-solving brand solution online, rather than
offline, this reflects how men prefer to shop. Investment will be made into
creating new digital assets and investment into Amazon conversion.
We will continue to deliver revenue synergies through international expansion,
retain a laser focus on brand contribution and release working capital tied up
in harvest brands. We remain committed to returning the business to
profitability at the earliest opportunity.
On behalf of the Board, I would like to thank our employees for their hard
work and commitment and shareholders for their continued support.
CEO's Statement 2024
We continue to make progress in increasing brand awareness, relevance, brand
and product productivity, and social and digital presence. We continue to look
at ways to address our over reliance on non-strategic sales channels; whilst
reducing our central corporate costs.
The well documented cost-of-living crisis affected certain categories more
disproportionally than others. Whilst we benefited from consumers buying into
more affordable hair colourants, which saw Root Perfect net sales grow by 14%,
conversely, the premium self-tan subcategory showed double digit decline.
Given the squeeze on disposable income, consumers switched from instant
premium tanners to more affordable gradual tanners. This resulted in Skinny
Tan's UK sales declining by 27%, despite the brand extending its global
distribution into Latin America and the Middle East. We also launched Skinny
Tan Body Glow (gradual tanner) into full UK omnichannel distribution in H2,
which resulted in it becoming the fastest growing value sku in the UK (Circana
12-week July 24).
The ongoing strong performance of the UK Beauty High Street and the general
softening of the direct-to-consumer market reinforces the need for a strong
omnichannel approach. We continue to work closely with our offline partners,
and I was pleased to see some notable distribution gains on our key Invest and
Nurture brands, in particular the launch of Super Facialist into Holland &
Barrett and Skinny Tan Body Glow distribution gains across the UK. The focus
for our DTC channels has been on improving profitability and ROAS (return on
advertising spend), whilst investing in brand content and assets so that we
can improve the overall immersive DTC brand experience.
Over the next 12 months we have a strong brand development program in place,
with several exciting product launches (Super Facialist and Skinny Tan), brand
redesigns (Super Facialist and Dirty Works); brand extensions (The Solution
Menopause and Haircare), and the relaunch of Skinny Tan as Skin & Tan in
2025. We are excited by our key customers and consumers response to the Skin
& Tan relaunch strategy and are confident that this will enable the brand
to increase its relevance and saliency. We are also optimistic that the new
face-centric skincare enhanced products will bring new consumers to the brand
and to the category.
Performance review
The 27% softening of Skinny Tan across the UK trade had an adverse effect on
all channels, in particular Boots and DTC, with the exception of Amazon where
Skinny Tan grew by 19%. However, Skinny Tan was able to grow its international
business with new listings in the Middle East and Peru. Rationalisation of the
portfolio and the exiting of three underperforming brands also affected the
overall UK business. Amazon was the standout channel with sales up 27%. Our
business in the USA General Merchandise discount channel declined by 34%, as
we took strategic steps to focus on the core portfolio. We were however
pleased that the remaining Export business grew 63%. This was driven by strong
Dirty Works distribution gains across 750 Watsons stores which helped Dirty
Works grow by 71% in this channel. We are over one year into our strategy of
rationalising our portfolio and focusing on problem solving, margin accretive
brands and this is beginning to show through. Our number one performance
priority is to continue to address ROS challenges and invest in topline sales
growth for our key Invest and Nurture brands.
Gross Profit margin increased by 1.5ppts to 41%, with Dirty Works +6ppts, Mr
Expert Solutions +13ppts and Dr Salts +17ppts. These offset the decline from
the Skinny Tan revenue reduction, which affected the overall margin mix of the
business. This reflects our drive to improve margins and long-term
profitability.
Whilst sales performance was disappointing, the business worked very hard in
reducing its losses. The underlying operating loss improved by £0.8m to show
a loss for the year of £0.4m. This was driven by £0.4m reduction in central
costs, notably the release of executive LTIP accruals and a reduction in
executive manpower costs. We made £0.4m savings in overheads driven by IDP
acquisition synergies.
Progress made against the Group's three strategic pillars is outlined below:
1. Brand Development
By the end of FY25 the objective is to rationalise the brand portfolio down to
8 brands, split into 3 classifications: Invest, Nurture and Harvest.
Skinny Tan and Super Facialist are classified as Invest Brands. They have an
omnichannel route to market including their own DTC site; masstige
positioning; a degree of existing scale as demonstrated through net sales and
market share, and both have significant growth potential through A&P
investment focusing on digital brand awareness and conversion campaigns. In
response to market research, we will be relaunching Skinny Tan as Skin &
Tan in FY25. This is a major and exciting initiative, which along with a
pipeline of exciting new face tan products, will help deliver sustainable and
long-term growth and address the declines of the last two years.
Dirty Works, The Solution and MR Expert Solutions are classified as Nurture
brands. Dirty Works has the potential to broaden its presence through new
category extensions, such as All Year-Round Gifting, to new distribution gains
through international partners, such as Watsons. The Solution and MR are both
high-performance propositions, with a clear point of difference that answer
the specific needs of the consumer. Our initial focus is on developing The
Solution brand by launching a highly efficacious and targeted sub brand called
The Solution Menopause. This launched on Amazon and its own DTC site in June
24. Our focus this financial year will be on extending the Menopause
distribution to other key retailers and then by introducing The Solution
Haircare range. Our vision is for The Solution to become a master brand that
provides focused personal care solutions.
Although we discontinued three brands last year, we will be exiting a further
two (SenSpa and Argan+) in FY25, which will leave a portfolio of three low
investment Harvest Brands. These brands, such as Root Perfect, require minimal
investment, they compete on price and provide us with a stronger category
share of voice and credibility with key customers. Fish, which was upgraded
with new packaging in 2024, has the potential to become a Nurture brand, once
its brand reach has been increased. Charles + Lee, which is an Australian
centric male grooming brand, has a strong gifting proposition and top 4
position in the Australian department store channel.
The following strategic Brand Development tenets have been applied to our
Invest and Nurture brands:
Profitability
With a sharp focus on brand contribution, our A&P spend is focused on our
Invest brands. We continually evaluate our packaging footprint in line with
our sustainability pledge and where possible remove all secondary packaging to
reduce costs. In addition, we implement VRE (value reengineering) initiatives
to reduce COG (cost of goods), so as to improve every brand's Gross Profit,
whilst retaining high product quality. One such initiative is the VRE of the
Root Perfect cans, which resulted in a double-digit Gross Profit improvement
at the latter end of last year.
The business continues to review its range offering and where possible we
rationalise ranges to remove duplication and improve sku productivity and
profitability. Last year the number of live skus was reduced by 19% to 248.
Along with prudent stock management, we were able to reduce our net inventory
by £1.4m. As part of the Skin & Tan relaunch planned for the next fiscal,
we will be reducing the range by 41% to 24 skus.
NPD/Consumer Insights
Towards the end of FY24 H2, Super Facialist launched a new Vegan Collagen
range and a range of new Night Moisturisers.
Vegan Collagen is an innovative, easy-to-navigate line up of ingredient-led,
solution-driven formulas including a cleanser, serum, day cream and night
cream. Blending a potent Marine Biopolymer made from sustainably sourced Red
Algae and Hyaluronic Acid, with plant-derived Vegan Collagen sourced from the
sap of the acacia tree. Collagen is a trending ingredient which responds to
the growing demand for age-preventative skincare, presenting an opportunity to
provide customers with an affordable trade-down collagen solution that's
vegan-friendly. It delivers both immediate and sustained hydration to the
skin, targeting signs of ageing to reveal a plumper and smoother complexion.
The Vegan Collagen line launched in Boots, Amazon and DTC at end of the year.
After three years of research and development Super Facialist launched a range
of Sleep Smart Night Creams across our bestselling ranges, Rosehip, Retinol
and Vitamin C. This "World first" Resync SleepSmart™ Complex technology is
powered by two potent & proven actives. It is a revolutionary concept
that helps reset & rejuvenate skin overnight when skin is its most
receptive to repair. The formulation works in synchronisation with the
skin's circadian rhythm for a refreshed & healthier looking complexion.
The new moisturisers started to filter through into store across all retailers
in Q4.
In response to the cost-of-living crisis the new Skinny Tan Body Glow Gradual
Tanner launched across all UK channels and became the fastest growing tanning
value sku in the UK. On the back of extensive consumer research, we will be
relaunching Skinny Tan in FY25. We expect the relaunch to facilitate new
customer acquisition, expand our press reach and increase the scope for new
brand listings domestically and internationally. Relaunching as Skin & Tan
is a simple name and logo change, but one that encapsulates our vision, where
everybody can radiate confidence and have a healthy glow. Skin & Tan is an
inclusive name that clearly demonstrates our expertise and enables easier
category, retailer and market expansion. In response to consumer demand, we
will be expanding our Face Tan products, which will be launching in time for
the new 2025 tanning season. The three new products will all retail at the
emotive and competitive £20 price point, and they all include the registered
Oxygeskin complex, that allows oxygen to strengthen the skin's barrier
functions, whilst improving skin quality. The new sub range includes a Deep
Hydration Sleepover Tan Mask, a Hydrating Tanning Mist; and a Hydrating SPF
Tanning Serum, which combines superior tanning technology with a
multi-molecular hydration complex and a broad SPF protection.
To maintain momentum and consumer engagement, design upgrades for Super
Facialist, MR Expert Solutions and Dirty Works will filter throughout FY25.
Digital 1(st)
Last year we restructured the team to better leverage resources and have
significantly increased digital activity across all commercial and media
channels. Performance marketing has been brought inhouse, thereby enabling us
to execute more paid activity across Google, YouTube, TikTok, Meta and
Affiliation, which helps drive consumers to D2C, Amazon and offline
retailers. We have shifted a higher portion of the media spend and organic
activity to TikTok and launched TikTok shops. Given the growing importance
of first party data/direct consumer touch, we have increased the focus on
building social following and grown the number of engaged customers in our
email/SMS databases, whilst also removing unengaged customers. The Skinny Tan
database engagement grew from 32% to 81% post the cleansing of the database,
which reduced from 340k to 180k. We have started involving brand fans more in
content creation and product development. We continue to launch products
first on D2C and Amazon, in order to quickly build 5-star reviews before
launching in other channels, but also to make sure that our loyal database
consumers are rewarded first.
Advertising & promotions (A&P)
A&P spend is focused on Skinny Tan and Super Facialist, both brands
benefit from a retained PR agency; appointed skincare & tanning experts;
substantial campaign activity across Google, YouTube, TikTok, Meta and retail
specific activation.
Last year we supported Super Facialist with a strong "Vitamin C + Me" campaign
and the focus for the next year is to significantly grow brand awareness and
foster engagement with both new and existing consumers, through 360
omnichannel campaigns that deliver extensive reach, provide disruptive brand
content, whilst being supported with PR and influencer campaigns. Digital
activity will be focused on the new Rosehip Double Cleanser launch in Boots in
the summer; Vegan Collagen and Sleep Smart activity in the Autumn, whilst our
main campaign will be focused on supporting the launch of Super Facialist
Vitamin C SPF 50 Serum in Spring 2025.
Last year Skinny Tan's Wonder Serum awareness and conversion campaign was
adversely affected by overall category dynamics, in particular consumer
confidence, level of discretionary spend and a change in consumption
behaviour. The focus for this fiscal is on addressing omnichannel brand
awareness and we will be putting higher media investment into broader and more
effective channel targeting and fully integrated omnichannel activation, in
order to reengage existing customers and reach new audiences. We will continue
to invest into conversion, which will be optimized around key retailer and
promotional moments. Investment will also go into a website relaunch; asset
upgrades; organic social activity and a PR campaign to support the relaunch
and extended distribution of the Body Glow franchise and the launch of Skin
& Tan Face Glow.
2. Brand Reach
We believe in an omnichannel distribution approach, to ensure that our
customers can buy our brands and products whenever, wherever and on whatever
they want. It is therefore imperative that we build our brand distribution
online and offline, whilst supporting our key Invest brands with their own DTC
sites.
UK & International
Last year we launched Super Facialist into Holland & Barrett and The
Solution into Waitrose. Dirty Works rolled out to 750 Watsons stores in 9
countries in the Middle East and Asia. Skinny Tan Body Glow launched in Boots,
Superdrug, Asda, Tesco and also in Peru and 6 Gulf countries. The brand
launched into 327 Morrisons stores in July 2024 and we are aiming to expand
distribution throughout the UK and Internationally on the back of the
forthcoming relaunch and exciting NPD. We plan to appoint an Australian
distributor to manage Skin & Tan DTC and on Amazon Australia, in time for
the Winter tanning season (like our new American model). This will enable us
to close the Skinny Tan Australian entity and further simplify our business.
We launched The Solution Menopause on Amazon in July 2024 and expect to secure
distribution gains across the three pillars of the brand in the second half of
the fiscal. Participation at Cosmoprof Bologna in March will be key to
securing international distribution for The Solution franchise. Our objective
with Super Facialist is to consolidate existing UK distribution and focus on
improving ROS and productivity. We are attending several ECRM International
Trade shows to secure new distribution in H2.
D2C
Our focus for the Skinny Tan D2C site has been on profitability and to align
pricing and promotions across all channels. Strategy for last year and the new
fiscal is to shift spend from D2C conversion to omnichannel awareness and
conversion. A more selective conversion advertising approach improved D2C ROAS
FY24 6.0 v FY23 4.4. However, the overall low demand and our omnichannel
approach of matching promotions and offers across all channels, resulted in
last year's disappointing but expected DTC net sales decline. All tech stack
contracts were renegotiated with savings achieved across the brands. In June
2024 we launched The Solution D2C site, which is integral to building
awareness and trial of the new Menopause range. Traffic and database growth
programmes will build slowly, since brand A&P will be focused on
omnichannel brand awareness. Our strategy for Super Facialist DTC is for the
site and database to grow organically on the back of increased traffic through
the wider omnichannel awareness campaigns, rather than aggressive conversion
investment. The site is steadily growing month on month, and we have further
improved profitability by moving to a more cost effective 3PL.
3. Sustainability
99% of our single products are fully recyclable or reusable. 60% of our
plastic packaging includes post recycled materials, with this figure reaching
90% for all tubes. 100% of our UK-sourced cartons have Forest Stewardship
Council (FSC) certification, reflecting our commitment to work in an
environmentally responsible manner whenever possible. We have also started
using Prevented Ocean Plastic™ (recycled plastic collected from coastal
areas at risk of plastic pollution) in some of our key brands such Super
Facialist, Dirty Works and Fish to actively prevent ocean plastic and further
support sustainable initiatives.
Outlook
The management team remains focused on continuing to realise both the
strategic and financial aims of the Group. In line with its Brand Development
strategic tenet, immediate priorities are launching an extensive new product
development pipeline planned for H2 and supported by extensive consumer
research, the repositioning of Skinny Tan as Skin & Tan, which will filter
through in 2025. We will be supporting this by driving brand awareness on
Super Facialist and Skinny Tan, with an expected year-on-year increase in
digital awareness and customer acquisition campaigns - with targeted
investment in Tik Tok and Influencer marketing.
We expect to deliver revenue growth through an improvement in consumer
awareness, product productivity, NPD pipeline and through international
expansion. We will retain a keen focus on brand contribution and will further
release working capital tied up in harvest brands or discontinued products. We
remain confident that the foundations we are building will enable us to return
to profitability and achieve our medium and long-term goals.
Financial Review
Key performance indicators
To measure and monitor our progress against our growth strategy, we track our
performance against a set of ambitious targets and milestones. The goals we
set are closely assessed to ensure we focus our efforts to deliver both in the
short term and long term. A summary of the financial measures used are:
2024 2023
Reported results from continuing operations
Revenue (Note 2) £17.0m £20.1m
Underlying operating loss(1) £(0.4)m £(1.2)m
Loss before taxation £(1.4)m £(6.8)m
Basic loss/earnings per share (5.2)p (23.5)p
Net cash £7.0m £8.2m
1 Underlying operating (loss) is calculated before
exceptional items, share-based payments and amortisation of
acquisition-related intangibles.
A reconciliation of underlying operating loss to operating loss is shown
below:
2024 2023
Total Total
Underlying loss from operations (412) (1,206)
Amortisation of acquisition-related intangibles (975) (1,027)
(Charge)/credit for share-based payments (26) 12
Exceptional items - Impairment of intangible - (3,500)
assets
Other exceptional items (133) (1,078)
Operating loss (1,546) (6,799)
The Group implements a number of non-statutory measures which are summarised
in the tables above and in more detail within the segmental income statement
(Note 2 of the financial statements). Exceptional items are also explained
further below and in Note 3 of the financial statements. These measures are
used to illustrate the impact of non-recurring and non-trading items on the
Group's financial results.
In addition to the financial key performance measures, a range of operational
non-financial key performance indicators are also monitored at a management
level covering, amongst others, new product development and innovation. The
Board receives an overview of these as part of its Board management report.
Statement of comprehensive income
Group statutory revenue for the year was £17.0m (FY 2023: £20.1m), a
decrease of 15% on the prior year due to a mix of factors. Sales reduced due
to the planned brand rationalisation programme, fewer Christmas gift
exclusives and challenging trading conditions in the UK caused by a cost of
living crisis and an unseasonably wet spring and early summer. International
sales were down £0.5m on the previous year.
The gross profit margin was better than the prior year, increasing by 1.5% to
41.2% (2023: 39.7%). This is due to improved sales mix. Margins from the sale
of Brand Architekts' brand products have been maintained despite continued and
significant cost increases throughout the supply chain, notably in raw
materials, componentry and energy. Cost increases were passed on to retailers
where possible and given previously agreed pricing commitments.
Despite the challenging trading environment, the Group generated a reduced
operating loss in H2, a significant improvement on the performance in H1, due
to a focus on better targeted advertising & promotions resulting in
improved contribution.
The Group made a loss before tax of £1.4m after amortisation of intangibles
£1m, and exceptional items of £0.13m which included restructuring costs
(£0.09m), and costs associated with the resolution of the legal claim with MR
haircare (£0.03m).
Financing costs were £0.1m (2023: £0.1m) relating to the defined benefit
pension plan notional finance charge.
The effective tax rate for the period was negative 4% (2023: negative 3%) of
pre-tax losses. The effective rate is below the statutory rate of 25.0% due to
the losses in the period.
Financial position and cash flow
The Group retains a net cash position of £7.0m, a reduction of £1.2m versus
the prior year (2023: £8.2m). The cash outflow was due to a mix of the
underlying operating loss of £0.4m and the acquisition of the remaining 49%
issued share capital of MR Haircare Ltd for £0.5m. The Company also made a
payment of £0.3m, its annual payment commitment to its defined benefit
pension scheme as outlined below.
Defined benefit pension plan
The defined benefit pension plan underwent its latest triennial valuation on 5
April 2023. The scheme funding at this date revealed a deficit of £4.6m. As a
result, the Group entered a revised deficit recovery plan and schedule of
contributions under which there is a commitment to pay £318k per annum for
the ten years to 30 June 2033 and to pay certain administration costs and the
PPF levy for the life of the plan.
Accounting standards require the discount rate used for valuations under IAS
19 'Employee Benefits' to be based on yields on high quality (usually
AA-rated) corporate bonds of appropriate currency, taking into account the
term of the relevant pension plan's liabilities. Corporate bond indices are
used as a proxy to determine the discount rate. In 2023 market conditions were
volatile, there has been some stability in 2024. At the reporting date, the
yields on bonds of all types were marginally more favourable than the prior
year and has resulted in a slightly more favourable discount rate being
adopted for accounting purposes. The fair value of the plan assets as measured
under IAS 19 has increased year on year at the same time that the fair value
of the scheme's liabilities has decreased, the net result is a decreased
liability under the IAS 19 methodology. For accounting purposes at 30 June
2024, the Group showed an unrecognised surplus of £0.8m under IAS 19. (2023:
net liability £1.6m).
Going concern
As part of its normal business practice, the Group prepares annual and
longer-term plans and, in reviewing this information the directors have a
reasonable expectation that the Company and Group have adequate resources to
continue in operational existence for the foreseeable future. The Group has
significant cash reserves of £7.0m. Accordingly, we continue to adopt the
going concern basis in preparing the Annual Report and Accounts.
Group Statement of Comprehensive Income
For the year ended 30 June 2024 and 30 June 2023
2024 2023
Notes £'000 £'000
Revenue 2 17,027 20,085
Cost of sales (10,008) (12,101)
Gross profit 7,019 7,984
Commercial and administrative costs (8,431) (10,202)
Operating loss before exceptional items (1,412) (2,218)
Exceptional items - Impairment of intangible assets 3 - (3,500)
Other exceptional items 3 (133) (1,078)
Operating loss (1,545) (6,796)
Finance income 173 111
Finance expense (74) (88)
Loss before taxation 4 (1,446) (6,773)
Taxation 5 56 188
Loss for the year (1,390) (6,585)
Other comprehensive income:
Items that will not be reclassified subsequently to profit or loss:
Re-measurement of defined benefit liability 1,031 444
Other comprehensive income for the year 1,031 444
Total comprehensive income for the year (359) (6,141)
Loss attributable to:
Equity shareholders (1,456) (6,588)
Non-controlling interests 66 3
Total comprehensive income attributable to:
Equity shareholders (425) (6,144)
Non-controlling interests 66 3
Earnings per share 6
- basic (5.2)p (23.5)p
- diluted (5.2)p (23.5)p
Dividends
Paid in year (£'000) Nil Nil
Paid in year (pence per share) Nil Nil
Proposed (£'000) Nil Nil
Proposed (pence per share) Nil Nil
Group Statement of Financial Position
As at 30 June 2024
2024 2023
Notes £'000 £'000
ASSETS
Non-current assets
Property, plant and equipment including right of use assets 29 43
Intangible assets 7 13,432 14,462
Deferred tax assets - 520
Total non-current assets 13,461 15,025
Current assets
Inventories 4,718 6,123
Trade and other receivables 4,794 4,774
Cash and cash equivalents 6,963 8,177
Total current assets 16,475 19,074
Total assets 29,936 34,099
LIABILITIES
Current liabilities
Trade and other payables 3,250 4,687
Current Tax Payable 2 2
Total current liabilities 3,252 4,689
Non-current liabilities
Post-retirement benefit obligations - 1,619
Deferred tax liabilities 1,952 2,190
Total non-current liabilities 1,952 3,809
Total liabilities 5,204 8,498
Net assets 24,732 25,601
EQUITY
Share capital 1,397 1,397
Share premium 11,987 11,987
Merger reserve 6,588 6,588
Retained earnings 4,760 5,398
Equity attributable to holders of the parent 24,732 25,370
Non-controlling interest - 231
Total equity 24,732 25,601
Group Statement of Changes in Equity
For the year ended 30 June 2024 and the year ended 30 June 2023
Share Capital Share Premium Merger Reserve Retained Earnings Non-controlling interest Total Equity
Group £'000 £'000 £'000 £'000 £'000 £'000
Balance as at June 2023 1,397 11,987 6,588 5,398 231 25,601
- - - - 66 66
Non-controlling interest
- - - 26 - 26
Share based payments
- - - (239) (297) (536)
Purchase of remaining NCI shares
Transactions with owners - - - (213) (231) (444)
Loss for the year attributable to equity shareholders - - - (1,456) - (1,456)
Other comprehensive income:
Re-measurement of defined benefit liability - - - 1,031 - 1,031
Total comprehensive income for the year - - - (425) - (425)
Balance as at June 2024 1,397 11,987 6,588 4,760 - 24,732
Share Capital Share Premium Merger Reserve Retained Earnings Non-controlling interest Total Equity
Group £'000 £'000 £'000 £'000 £'000 £'000
Balance as at June 2022 1,397 11,987 6,588 11,554 228 31,754
- - - - 3 3
Non-controlling interest
- - - (12) - (12)
Share based payments
Transactions with owners - - (12) 3 (9)
Loss for the year attributable to equity shareholders - - - (6,588) - (6,588)
Other comprehensive income:
Re-measurement of defined benefit liability - - - 444 - 444
Total comprehensive income for the year - - - (6,144) - (6,144)
Balance as at June 2023 1,397 11,987 6,588 5,398 231 25,601
Cash Flow Statement
For the year ended 30 June 2024 and the year ended 30 June 2023
Group Company
2024 2023 2024 2023
£'000 £'000 £'000 £'000
Cash flow from operating activities
Loss before taxation (1,446) (6,773) (6,311) (5,493)
Depreciation 33 32 - -
Amortisation 1,054 1,118 23 74
Impairment of property, plant & equipment - (166) - -
Impairment of intangible assets - 3,500 - -
Impairment of investments - - 3,600 3,500
Finance income (173) (111) (161) (111)
Finance cost 74 88 74 88
(Increase)/ Decrease in inventories 1,405 1,252 - -
Decrease /(Increase) in trade and other receivables (20) 325 2,075 (904)
Increase / (Decrease) in trade and other payables (1,442) (2,082) (829) (996)
Share based payment expense 26 (14) 8 (23)
Contributions to defined benefit plans (318) (318) (318) (318)
Cash outflow from operations (807) (3,149) (1,839) (4,183)
Taxation received - (66) - -
Net cash outflow from operating activities (807) (3,215) (1,839) (4,183)
Cash flow from investing activities
Purchase of property, plant and equipment (19) (22) - -
Purchase of intangible assets (24) (44) - -
Cash consideration paid for acquisitions (537) - (537) -
Net cash flow from investing activities (580) (66) - -
Cash flow from financing activities
Finance income received 173 111 161 111
Net cash flow from financing activities 173 111 161 111
Net decrease in cash and cash equivalents (1,214) (3,170) (2,215) (4,072)
Cash and cash equivalents at beginning of year 8,177 11,347 5,730 9,802
Cash and cash equivalents at end of year 6,963 8,177 3,515 5,730
Notes to the Accounts
The financial information does not constitute statutory accounts as defined in
section 435 of the Companies Act 2006, but has been extracted from the
statutory accounts for the period ended June 2024 on which an unqualified
audit report has been issued and which will be delivered to the Registrar
following their adoption at the Annual General Meeting. The statutory
accounts for the period ended June 2023 have been delivered to the Registrar
of Companies with an unqualified audit report and did not contain a statement
under section 498 of the Companies Act 2006. Copies of the 2024 Annual Report
and Accounts with the notice of Annual General Meeting will be sent to
shareholders via their elected channel. Further copies may be obtained by
contacting the Company Secretary at Brand Architekts Group plc, 8 Waldegrave
Rd, Teddington, TW11 8GT. An electronic copy will be available on the Group's
web site (www.brandarchitektsplc.com (https://brandarchitektsplc.com/) ).
Note 1 Significant accounting policies
General Information
Brand Architekts Group plc is a public limited company which is listed on AIM
and is incorporated in the United Kingdom under the Companies Act 2006. The
address of the registered office is given at the end of the financial report.
The nature of the Group's operations and its principal activities are set out
in the Strategic Report. The results for the current period have been drawn up
for a traditional 12 month calendar year.
Basis of preparation
The Group has prepared its consolidated financial statements in accordance
with UK adopted International Accounting Standards (UK adopted IAS) in
conformity with the requirements of the Companies Act 2006. These financial
statements have been prepared under the historical cost convention.
The Directors have considered trading and cash flow forecasts prepared for the
Group, and based on these, and the level of cash held, are satisfied that the
Group will continue to be able to meet its liabilities as they fall due for at
least one year from the date of signing of these accounts. In making this
assessment directors have considered the possible impact of a reduction of
trading on budgets and have stress tested the figures by comparing costs
committed to with the cash available which showed sufficient headroom to
continue trading. On this basis, they consider it appropriate to adopt the
going concern basis in the preparation of these accounts.
The consolidated financial statements are presented in sterling and all values
are rounded to the nearest thousand (£'000) except where otherwise indicated.
Basis of consolidation
The Group financial statements consolidate the financial statements of the
Company and its subsidiary undertakings. The results and net assets of
undertakings acquired or disposed of during a financial year are included in
the Group Statement of Comprehensive Income and Group Statement of Financial
Position from the effective date of acquisition or to the effective date of
disposal. Subsidiary undertakings have been consolidated using the
acquisition method of accounting. In accordance with the exemptions given by
section 408 of the Companies Act 2006, the Company has not presented its own
Statement of Comprehensive Income. The Company's loss after tax for the year
to June 2024 was £6.479m (2023: loss after tax £5.529m).
The Group financial statements consolidate those of the parent company and all
of its subsidiaries as of 30 June 2024. The parent controls a subsidiary if it
is exposed, or has rights, to variable returns from its involvement with the
subsidiary and has the ability to affect those returns through its power over
the subsidiary. All subsidiaries have a reporting date of 30 June.
All transactions and balances between Group companies are eliminated on
consolidation, including unrealised gains and losses on transactions between
Group companies. Amounts reported in the financial statements of subsidiaries
have been adjusted where necessary to ensure consistency with the accounting
policies adopted by the Group.
Profit or loss and other comprehensive income of subsidiaries acquired or
disposed of during the year are recognised from the effective date of
acquisition, or up to the effective date of disposal, as applicable.
Note 2 Segmental Analysis
During the year, there were three reportable segments of the Group, the
reportable segments of the Group were aggregated as follows:
· Brand Architekts Brands - These include those brands organically
developed plus the acquisitions of the portfolio of Brands included in The
Brand Architekts acquisition (in 2016) and the Fish brand acquired during
2018.
· Innovaderma Brands - This segment includes those brands acquired
as part of the Innovaderma business combination. The results of Innovaderma
brands are currently reported separately from other brands to the directors.
· Eliminations and Central Costs. Other Group-wide activities and
expenses, including defined benefit pension costs, share-based payment
expenses / (credits), amortisation of acquisition-related intangibles,
interest, taxation and eliminations of intersegment items, are presented
within 'Eliminations and central costs'.
This is the basis on which the Group presents its operating results to the
Directors, which is considered to be the Chief Operating Decision Maker (CODM)
for the purposes of IFRS 8. Comparative full year numbers have been presented
on the same basis.
IFRS15 requires the disaggregation of revenue into categories that depict how
the nature, timing, amount and uncertainty of revenue and cash flows are
affected by economic factors. The directors have considered how the Group's
revenue might be disaggregated in order to meet the requirements of IFRS15 and
has concluded that the activity and geographical segmentation disclosures set
out below represent the most appropriate categories of disaggregation.
a) Principal measures of profit and loss - Income Statement segmental
information for year ended 30 June 2024 and year ended 30 June 2023:
Year ended 30 June 2024 Brand Architekt Brands Eliminations and Central Costs Total
Innovaderma Brands
£'000 £'000 £'000 £'000
UK revenue 10,592 2,698 - 13,290
International revenue 3,280 457 - 3,737
Revenue - External 13,872 3,155 - 17,027
Total Revenue 13,872 3,155 - 17,027
Underlying profit / (loss) from operations 457 (147) (721) (411)
Charge for share-based payments (18) - (8) (26)
Amortisation of acquisition-related intangibles - - (975) (975)
Other Exceptional items (Note 3) (83) (25) (25) (133)
Net borrowing income 10 2 87 99
Profit / (Loss) before taxation 366 (170) (1,642) (1,446)
Tax charge - (20) 76 56
Profit/(Loss) for the year 366 (190) (1,566) (1,390)
Year ended 30 June 2023 Brand Architekt Brands Eliminations and Central Costs
Innovaderma Total
Brands
£'000 £'000 £'000 £'000
UK revenue 11,243 4,538 - 15,781
International revenue 3,225 1,079 - 4,304
Revenue - External 14,468 5,617 - 20,085
Total Revenue 14,468 5,617 - 20,085
Underlying profit/(loss) from operations 193 (233) (1,166) (1,206)
Credit / (charge) for share-based payments (12) - 24 12
Amortisation of acquisition-related intangibles - - (1,027) (1,027)
Exceptional items - Impairment of intangible assets (Note 3) - (3,500) - (3,500)
Other Exceptional items (Note 3) (147) (297) (634) (1,078)
Net borrowing income - - 26 26
Profit/(Loss) before taxation 34 (4,030) (2,777) (6,773)
Tax charge 77 (91) 202 188
Profit/(Loss) for the period 111 (4,121) (2,575) (6,585)
The segmental Income Statement disclosures are measured in accordance with the
Group's accounting policies as set out in note 1.
All defined benefit pension costs and an element of the share-based payment
expenses are recognised for internal reporting to the CODM as part of
Group-wide activities and are included within 'Eliminations and central costs'
above. Other costs, such as Group insurance and auditors' remuneration which
are incurred on a Group-wide basis are recharged by the head office to
segments on a reasonable and consistent basis for all periods presented, and
are included within segment results above.
b) Other Income Statement segmental information
Year ended 30 June 2024 Brand Architekt Brands Innovaderma Eliminations and Central Costs Total
Brands
£'000 £'000 £'000 £'000
Depreciation / impairment of PPE 33 - - 33
Amortisation / impairment of intangibles * 79 - 975 1,054
Year ended 30 June 2023 Brand Architekt Brands Innovaderma Eliminations and Central Costs Total
Brands
£'000 £'000 £'000 £'000
Depreciation 32 - - 32
Amortisation/ impairment* 91 3,500 1,027 4,618
* Impairment losses of £Nil (2023: £nil) in Central Costs is included in
Exceptional Items - Impairment of intangible assets
c) Principal measures of assets and
liabilities
The Groups assets and liabilities are managed centrally by the CODM and
consequently there is no reconciliation between the Group's assets per the
statement of financial position and the segment assets.
d) Additional entity-wide disclosures
The distribution of the Group's external revenue by destination is shown
below:
Geographical segments Year ended Year ended
30 June 2024 30 June 2023
£'000 £'000
UK 13,290 15,781
Other European Union countries 751 642
Rest of the World 2,986 3,662
17,027 20,085
In the year ended 30 June 2024, the Group had two customers that exceeded 10%
of total revenues, being 11.0% and 10.7% respectively. In the year ended 30
June 2023, the Group had one customer that exceeded 10% of total revenues,
being 13.7%. All of these customers are reported within the Brand Architekts
Brands segment. Revenue is recognised when goods are despatched to the
customer and the significant risks and rewards of ownership to the customer
have been transferred. Our policy requires customers to pay us in accordance
with agreed payment terms. Depending on the geographical location, our
settlement terms are generally due within 30 or 60 days from the end of the
month of sale.
Note 3 Exceptional Items
Exceptional charges / (credits) from Continuing Operations: Year ended Year ended
30 June 2024 30 June 2023
£'000 £'000
Exceptional items - Impairment of intangible assets - 3,500
Other exceptional items:
Restructuring costs 83 390
Legal costs 31
705
Other exceptional costs 19
(17)
Total exceptional items 133 4,578
Exceptional impairments of intangible assets relates to the partial impairment
of the InnovaDerma brand of £nil (2023: £3.5m).
Restructuring costs of £0.08m (2023: £0.4m) have been incurred following the
acquisition of InnovaDerma in 2022.
Legal costs of £0.03m (2023: £0.7m) associated with the resolution of the
claim with MR Haircare were incurred in the year. There are no further costs
connected with the settlement agreement (2023: £425k).
Note 4 Loss before taxation
2024 2023
£'000 £'000
(a) This is stated after charging/ (crediting)
Depreciation of property, plant and equipment of purchased assets 33 32
Amortisation of intangible assets 1,054 1,118
Foreign exchange (gains) / losses 51 66
Amounts expensed for short term and low value leases 56 56
(b) Auditors' remuneration
Audit services:
Audit of the Company financial statements 64 57
Audit of subsidiary undertakings 44 32
Audit related services:
Interim review 3 3
Note 5 Taxation
2024 2023
(a) Analysis of tax charge in the year £'000 £'000
UK corporation tax:
- on profit for the year - -
- adjustment in respect of previous years 5 -
Total current tax credit - -
Deferred tax: - -
-current year (credit)/ charge (61) (188)
Total deferred tax charge (61) (188)
Tax charge (188)
(56)
(b) Factors affecting total tax charge for the year
The tax assessed on the profit before taxation for the year is at the standard
rate of UK corporation tax of 25.00% (2023: 20.50%). The differences are
reconciled below:
2024 2023
£'000 £'000
Loss before taxation (1,446) (6,773)
Tax at the applicable rate of 20.5.% (2022: 19.00%) (361) (1,388)
Effect of:
Adjustment in respect of previous years 5 -
Expenses not deductible for tax purposes 162 792
Adjustment to losses - 15
Deferred tax asset not recognised on taxable losses 134 494
Remeasurement of deferred tax for changes in tax rates - (44)
Other timing differences 4 (57)
Actual tax (credit) (56) (188)
Amount of tax charged directly to equity 344 376
The group has tax losses of £13.8m (2023: £12.9m) which have not been
recognised as there is no certainty that they can be utilised.
Note 6 Earnings per share
2024 2023
Basic and Diluted
Loss for the year attributable to equity holders (£'000) (1,456) (6,588)
Basic weighted average number of ordinary shares in issue during the year 27,943,180 27,943,180
Diluted number of shares 28,748,949 28,032,180
Basic loss per share (5.2)p (23.5)p
Diluted loss per share (5.2)p (23.5)p
Basic earnings per share has been calculated by dividing the profit for each
financial year by the weighted average number of ordinary shares in issue at
30 June 2024 and 30 June 2023 respectively.
Note 7 Intangible assets
Software and Trademarks Brand Names Customer Relationships Goodwill Trade Total
marks
GROUP £'000 £'000 £'000 £'000 £'000 £'000
Cost:
At June 2022 603 10,323 4,455 8,354 19 23,754
Additions 44 - - - - 44
At June 2023 647 10,323 4,455 8,354 19 23,798
Additions 24 - - - - 24
At June 2024 671 10,323 4,455 8,354 19 23,822
Amortisation:
At June 2022 471 3,024 1,386 - 3 4,884
Provided during the year 85 466 561 - 6 1,118
Impairment charge during the year - - - 3,500 - 3,500
Disposals - - - (166) - (166)
At June 2023 556 3,490 1,947 3,334 9 9,336
Provided during the year 69 322 653 - 10 1,054
At June 2024 625 3,812 2,600 3,334 19 10,390
Net book value:
At June 2024 46 6,511 1,855 5,020 - 13,432
At June 2023 91 6,833 2,508 5,020 10 14,462
Brand Names Customer Relationships Total
COMPANY £'000 £'000 £'000
Cost:
At June 2022 3,624 480 4,104
At June 2023 3,624 480 4,104
At June 2024 3,624 480 4,104
Amortisation:
At June 2022 3,024 383 3,407
Provided during the year - 74 74
At June 2023 3,024 457 3,481
Provided during the year - 23 23
At June 2024 3,024 480 3,504
Net book value:
At June 2024 600 - 600
At June 2023 600 23 623
Impairment testing
Three Brands (Brand Architekts, Fish and InnovaDerma) and associated goodwill
have been tested for impairment as they have indefinite useful lives. All the
brands gave a valuation in excess of their carrying values, and therefore no
impairment is required.
The recoverable amount of each brand was determined based on the higher of
value-in-use calculations or fair value less costs to sell. The value-in-use
calculations covered underlying 1-2 year forecasts, followed by an
extrapolation of expected cash flows for the remaining useful life using
growth assumptions of 2%. Fair value less costs to sell was determined by a
review of historical acquisitions in the consumer goods market of similar size
and current market data to identify multiples that have been paid.
The present value of the expected cash flows is determined by applying a
suitable discount rate for current market assessments of the time value of
money and risks specific to the brand. The discount rate applied is 12.2%
(2023: 8.1%), reflecting expected returns for AIM listed businesses as well as
the debt free capital structure of the Group.
Growth assumptions
Management have assumed a base case growth rate of 2%, in line with wider
industry forecasts, in the calculations including into perpetuity.
Discount rates
The discount rates reflect appropriate adjustments relating to market risk and
specific risk factors.
Cash flow assumptions
Management's key assumptions include profit margins, based on past experience
in this market. The Group's management believes that this is the best
available input for forecasting this mature sector. The expectations included
in the workings are for increases in performance and profits being made due to
cost synergies from integration into the BAG group and a focus on higher
margin products.
Apart from the considerations in determining the value-in-use of the brand
described above, management is not currently aware of any other probable
changes that would necessitate changes in its key estimates. The values of the
intangibles with indefinite useful lives for Brand Architekts remains at
£7,709,000 (comprising Goodwill of £2,618,000 and Brands of £5,091,000),
while the Fish brand net carry value is £600,000. Goodwill held in relation
to InnovaDerma was £2,402,000. The value of the customer relationship
intangibles for Brand Architekts are £313,000. The values of the customer
relationship and brand intangibles for InnovaDerma are £1,397,000 and
£964,000 respectively.
Sensitivity analysis
Impairment is assessed on the higher of the value in use and fair value less
costs to sell and as a result the fair value has been used to assess the
impairment. The maximum amount that fair value less costs to sell would reduce
by before there is an impairment is £2,636k for Brand Architekts goodwill and
brand names and £1,282k for the Innovaderma group goodwill.
Note 8 Notes to Cash Flow Statement
GROUP
2024 2023
£'000 £'000
Decrease in cash and cash equivalents (1,214) (3,170)
Change in net cash (1,214) (3,170)
Opening net cash 8,177 11,347
Closing net cash 6,963 8,177
Closing 2023 Cash Flow Closing 2024
(b) Analysis of net cash:
£'000 £'000 £'000
Cash at bank and in hand 8,177 (1,214) 6,963
8,177 (1,214) 6,963
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END FR FEFESSELSEDS