REG - Christie Group PLC - Interim Results
26/09/2022 07:00
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RNS Number : 5357A Christie Group PLC 26 September 2022
26 September 2022
Christie Group plc
Interim Results for the six months ended 30 June 2022
Christie Group plc ('Christie Group' or the 'Group'), the leading provider of
Professional & Financial Services (PFS) and Stock & Inventory Systems
& Services (SISS) to the hospitality, leisure, healthcare, medical,
childcare & education and retail sectors, is pleased to announce its
interim results for the six months ended 30 June 2022.
H1 2022 Highlights
· Revenues up by £5.1m (18%) to £33.7m (H1 2021: £28.6m)
· Operating profit increased by 26% to £2.3m (H1 2021: £1.8m)
· Strong PFS performance with robust demand across all sectors with
strong pipelines
· Hospitality stocktaking business now trading profitably post
Covid
· Significant progress made in SISS division
· Increase in interim dividend to 1.25p (H1 2021: 1.0p)
· Strong cash balance at 30 June 2022 of £8.6m
· Earnings per share increased by 69% to 5.36p (H1 2021: 3.17p)
· Pension liability further reduced by £1.0m (11%)
· We look forward to a strong and profitable H2
Commenting on the results, David Rugg, Chairman and Chief Executive of
Christie Group, said:
"A pleasing 1st half year performance with both revenues and profitability
increasing. We have strong demand for our services and continue to win notable
assignments. Despite the economic clouds gathering, we anticipate a successful
full year performance."
Enquiries:
Christie Group plc
David Rugg 020 7227 0707
Chairman and Chief Executive
Daniel Prickett 020 7227 0700
Chief Operating Officer
Simon Hawkins 020 7227 0700
Group Finance Director
Shore Capital
Patrick Castle/Iain Sexton 020 7408 4090
Nominated Adviser & Broker
Notes to Editors:
Christie Group plc (CTG.L), quoted on AIM, is a leading professional business
services group with 38 offices across the UK and Europe, catering to its
specialist markets in the hospitality, leisure, healthcare, medical, childcare
& education and retail sectors.
Christie Group operates in two complementary business divisions:
Professional & Financial Services (PFS) and Stock & Inventory Systems
& Services (SISS). These divisions trade under the brand names: PFS
- Christie & Co, Pinders, Christie Finance and Christie Insurance: SISS
- Orridge, Venners and Vennersys.
Tracing its origins back to 1846, the Group has a long-established reputation
for offering valued services to client companies in agency, valuation
services, investment, consultancy, project management, multi-functional
trading systems and online ticketing services, stock audit and inventory
management. The diversity of these services provides a natural balance to the
Group's core agency business.
The information contained within this announcement is deemed by the Company to
constitute inside information for the purposes of Article 7 of the UK Market
Abuse Regulation (EU) No. 596/2014 which is part of the UK law by virtue of
the European Union (Withdrawal) Act 2018.
For more information, please go to https:// (https://www.christiegroup.com)
www.christiegroup.com (https://www.christiegroup.com)
Chairman and Chief Executive's review
I am pleased to report a 26% increase in operating profit for the period to
£2.3m (H1 2021: £1.8m). We increased revenue by 18% to £33.7m (H1 2021:
£28.6m). Earnings per share increased to 5.36p per share (H1 2021: 3.17p) an
increase of 69% over the corresponding period on the prior year. During the
period we repaid a further £1.0m of CLBILS loan.
Our pension liability has reduced by a further £1.0m. Of the outstanding
amount, £5.5m relates to a provision under IFRIC 14. This concerns further
contributions which could result in the overfunding of our defined benefit
schemes. The Employers do not intend to make excess payments and solutions are
being discussed with Trustees to avoid creating surplus funds which are locked
in.
Recruitment, whilst challenging, has generally proved successful, although
with vacancies filled later in the year than originally planned.
Professional & Financial Services Division.
The Division generated an 8% increase in revenue to £22.1m (H1 2021:
£20.6m). Operating profit was progressively higher at £3.2m (H1 2022:
£3.1m) with Q2 building on Q1.
We have enjoyed a strong period of demand for our transactional services,
across each of the specialist industry sectors in which we operate. This
despite the strong economic headwinds these operations face. Investors were
undeterred by the increased level of interest rates. These have broadly been
priced into market prices to date.
Christie & Co continues to dominate the hotel & leisure transactional
market. Hospitality businesses offering accommodation have enjoyed buoyant
levels of trade, as air travel disruption, increased fares and capacity limits
have continued to boost domestic business.
Our international territories have contributed notable assignments. Over 50%
of our Hotel Industry fees are now generated from outside the U.K. Our
geographical reach is illustrated by our sales of; the Novotel Chartres,
Mercure Hotels in Chamonix and Saint-Emilion, Welcome Hotel in Essen, Ulemiste
Hotel in Tallin and AT Calle Victoria in Malaga.
In other sectors where Christie & Co is dominant, we sold The Hub group of
16 pharmacies, Eastleigh Care Group, Twinkles Nursery Group and CB Motors and
acquired The Cock Inn Mugginton & Meynell Ingram Arms in Burton upon Trent
for RedCat Pub Company.
Valuation assignments executed by Christie & Co included the revaluation
of the Marston estate of 1,500 pubs and restaurants, for balance sheet
purposes.
Our valuation practice, Pinders, is enjoying buoyant demand and is being
suitably selective to ensure that turnaround times for assignments delivered
reflect our service ethos.
Following the success of the sectorisation of our transactional and advisory
teams in Christie & Co, Christie Finance has itself appointed lead roles
for medical, healthcare, childcare & education, retail and hospitality
lending.
Stock & Inventory Systems & Services
Revenue increased by 43% to £11.5m (H1 2021: £8.0m), with further recovery
available. An operating loss for the period of £0.9m (H1 2021: £1.3m) was
incurred. This was an improvement of £0.4m over the corresponding period last
year. No furlough support was received during 2022 whereas H1 2021 included
£2.0m of government support.
Our stocktaking businesses continue to increase prices to reflect their
increased labour, energy and transport costs.
Our Leisure and Hospitality stocktaking business, Venners, is now trading
profitably once more following the continued pandemic effects experienced at
the start of the year. Client wins included Red Lion Holdings, BrewDog and
Inglenook Inns & Taverns. In addition to stocktaking, we are conducting
financial & brand audits including audits across the Boparan restaurant
brands using our bespoke audit system.
Our Retail stocktaking business has recovered to the point that 3 out of 5
operations are now trading profitably. Margins are good and our objective is
to increase revenue. Contract renewals included Waterstones and Wilko and new
clients included Claires. Orridge added over 100 further pharmacy stocktakes
for Jhoots Pharmacy, Living Care and matrix Pharmacy.
Our SaaS for visitor attraction business, Vennersys, is acknowledged as the
most functionally rich suitable system for a wide range of venues including
heritage properties, play centres & museums. Contract renewals included
Blenheim Palace. Client's post pandemic online revenue has reduced as a
proportion of sales, as 'walk ins', as distinct from advance bookings, are
once more a feature of their trade. We have nonetheless continued to increase
our total online revenue, from which we derive income.
Looking Ahead
We have received extensive interest in the Four Seasons Healthcare Group from
a wide range of parties including real estate investors, corporate buyers,
regional groups, and SME operators all of whom are looking for growth
opportunities via acquisition. The first round bid process will conclude in
early Autumn.
We enjoy strong transactional pipelines. Our international hotel transaction
and consulting practice is robust.
Our SISS division, overall, has made significant progress, with further new
client proposals outstanding.
Our staff have enjoyed and benefitted from their renewed in person team and
company meetings. They are busy and proactive, and I thank them for their
energy and ideas.
As we go to press, we are in a strong cash position.
On behalf of the board and colleagues, I record our heartfelt appreciation for
the dedicated, loving and unstinting reign of H M Queen Elizabeth II. We
welcome our Sovereign King Charles III.
An increased interim dividend of 1.25p per share (H1 2021: 1.0p) will be paid
on 4 November 2022 to shareholders on the register on 7 October 2022.
Despite the economic clouds gathering, we anticipate a successful full year.
Stay warm!
David Rugg
Chairman and Chief Executive
Independent Review Report to Christie Group plc for half year ended 30 June
2022
We have been engaged by Christie Group PLC ("the Company") to review the
financial information for the six months ended June 2022 which comprises the
consolidated profit and loss account, the consolidated balance sheet, the
consolidated statement of total recognised gains and losses, the consolidated
cash flow statement and related notes 1 to 16. We have read the other
information contained in the interim report and considered whether it contains
any apparent misstatements or material inconsistencies with the financial
information.
This report is made solely to the Company in accordance with International
Standard on Review Engagements (UK and Ireland) 2410 issued by the Auditing
Practices Board and our Engagement Letter dated 08 August 2022. Our work has
been undertaken so that we might state to the Company those matters we are
required to state to them in an independent review report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company, for our review work, for this
report, or for the conclusions we have formed.
Respective responsibilities of directors and auditor
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting', and the
AIM Rules issued by the London Stock Exchange, which requires that the interim
report must be prepared and presented in a form consistent with that which
will be adopted in the company's annual accounts having regard to the
accounting standards applicable to such annual accounts.
Our responsibility is to express to the Company a conclusion on the
consolidated financial information in the interim report based on our review.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK) and consequently does
not enable us to obtain assurance that we would become aware of all
significant matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the consolidated financial information in the interim report does
not give a true and fair view of the financial position of the Company as at
30 June 2022 and of its financial performance and its cash flows for the six
months then ended, in accordance with UK adopted International Accounting
Standard 34, 'Interim Financial Reporting', and the AIM Rules issued by the
London Stock Exchange.
Signed:
Mazars LLP
Chartered Accountants
The Pinnacle
160 Midsummer Boulevard
Milton Keynes
MK9 1FF
23 September 2022
Notes:
(a) The maintenance and integrity of the Christie Group PLC web site is the
responsibility of the directors; the work carried out by us does not involve
consideration of these matters and, accordingly, we accept no responsibility
for any changes that may have occurred to the interim report since it was
initially presented on the web site.
(b) Legislation in the United Kingdom governing the preparation and
dissemination of financial information may differ from legislation in other
jurisdictions.
Consolidated interim income statement
Note Half year to 30 June Half year to 30 June Year ended 31 December 2021
2022 2021 £'000
£'000 £'000 (Audited)
(Unaudited) (Unaudited)
Revenue 4 33,653 28,587 61,252
Other income - government grants 5 - 2,140 2,592
Employee benefit expenses (23,289) (21,858) (44,332)
Other operating expenses (8,087) (7,062) (14,318)
Operating profit 2,277 1,807 5,194
Finance costs (548) (609) (1,329)
Finance income - - 26
Total finance charge (548) (609) (1,303)
Profit before tax 1,729 1,198 3,891
Taxation 6 (333) (367) (316)
Profit for the period after tax 1,396 831 3,575
Earnings per share attributable to equity holders - pence
Basic 7 5.36 3.17 13.71
Diluted 7 5.26 3.13 13.34
Profit for the period after tax is wholly attributable to equity shareholders
of the parent.
All amounts derive from continuing operations.
Consolidated interim statement of comprehensive income
Half year to 30 June Half year to 30 June Year ended 31 December 2021
2022 2021 £'000
£'000 £'000 (Audited)
(Unaudited) (Unaudited)
Profit for the period after tax 1,396 831 3,575
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translating foreign operations 75 (32) 100
Net other comprehensive income/(losses) to be reclassified to profit or loss 75 (32) 100
in subsequent periods
Items that will not be reclassified to profit or loss:
Re-measurement gains on defined benefit plans 6,338 5,321 13,181
Effect of asset ceiling (5,517) - (1,788)
821 5,321 11,393
Tax effect on defined benefit plans (1,585) (1,011) (2,089)
Tax effect of asset ceiling 1,380 - 447
(205) (1,011) (1,642)
Net other comprehensive income not being reclassified to profit or loss in 616 4,310 9,751
subsequent periods
Other comprehensive income for the period 691 4,278 9,851
Total comprehensive income for the period 2,087 5,109 13,426
Total comprehensive income for the period is wholly attributable to equity
shareholders of the parent.
Consolidated interim statement of changes in shareholders' equity
Share capital Other reserves £'000 Cumulative Retained earnings Total equity
£'000 translation £'000 £'000
reserve
£'000
Half year to 30 June 2022 (unaudited)
Balance at 1 January 2022 531 5,246 686 (4,906) 1,557
Profit for the period after tax - - - 1,396 1,396
Items that will not be reclassified subsequently to profit or loss - - 616 616
-
Items that may be reclassified subsequently to profit or loss - 75 - 75
-
Total comprehensive income for the period - - 75 2,012 2,087
Movement in respect of employee share scheme - 30 - - 30
Employee share option scheme:
- value of services provided - (30) - - (30)
Dividend payable - - - (520) (520)
Balance at 30 June 2022 531 5,246 761 (3,414) 3,124
Half year to 30 June 2021 (unaudited)
Balance at 1 January 2021 531 5,462 586 (17,972) (11,393)
Profit for the period after tax - - - 831 831
Items that will not be reclassified subsequently to profit or loss - - 4,310 4,310
-
Items that may be reclassified subsequently to profit or loss - (32) - (32)
-
Total comprehensive (losses)/income for the period - - (32) 5,141 5,109
Movement in respect of employee share scheme - 30 - - 30
Employee share option scheme:
- value of services provided - (229) - - (229)
Balance at 30 June 2021 531 5,263 554 (12,831) (6,483)
Year ended 31 December 2021 (audited)
Balance at 1 January 2021 531 5,462 586 (17,972) (11,393)
Profit for the year after tax - - - 3,575 3,575
Items that will not be reclassified subsequently to profit or loss - - - 9,751 9,751
Items that may be reclassified subsequently to profit or loss - - 100 - 100
Total comprehensive income for the year - - 100 13,326 13,426
Movement in respect of employee share scheme - (278) - - (278)
Employee share option scheme:
- value of services provided - 62 - - 62
Dividends paid - - - (260) (260)
Balance at 31 December 2021 531 5,246 686 (4,906) 1,557
Consolidated interim statement of financial position
At 31 December 2021
At 30 June 2022 At 30 June 2021 £'000
£'000 £'000 (Audited)
(Unaudited) (Unaudited)
Note
Assets
Non-current assets
Intangible assets - Goodwill 1,819 1,818 1,800
Intangible assets - Other 1,032 1,014 1,043
Property, plant and equipment 1,289 1,546 1,346
Right of use assets 4,962 5,461 5,106
Deferred tax assets 2,927 3,867 3,460
Other receivables 2,555 2,263 2,555
14,584 15,969 15,310
Current assets
Inventories 23 14 15
Trade and other receivables 9 13,455 11,895 12,502
Current tax assets 876 1,005 946
Cash and cash equivalents 14 8,565 9,785 8,167
22,919 22,699 21,630
Total assets 37,503 38,668 36,940
Equity
Capital and reserves attributable to the Company's equity holders
Share capital 10 531 531 531
Other reserves 5,246 5,263 5,246
Cumulative translation reserve 761 554 686
Retained earnings (3,414) (12,831) (4,906)
Total equity 3,124 (6,483) 1,557
Liabilities
Non-current liabilities
Trade and other payables 625 50 546
Retirement benefit obligations 11 7,989 14,997 8,997
Borrowings - 2,000 1,000
Lease liabilities 7,401 7,750 7,488
Provisions 1,344 1,027 1,352
17,359 25,824 19,383
Current liabilities
Trade and other payables 12 9,227 12,186 10,863
Current tax liabilities 220 - 299
Borrowings 5,409 4,751 2,568
Lease liabilities 1,048 1,219 1,170
Provisions 1,116 1,171 1,100
17,020 19,327 16,000
Total liabilities 34,379 45,151 35,383
Total equity and liabilities 37,503 38,668 36,940
Consolidated interim statement of cash flows
Note Half year to 30 June Half year to 30 June Year ended 31 December 2021
2022 2021 £'000
£'000 (Unaudited) £'000 (Audited)
(Unaudited)
Cash flow from operating activities
Cash (used in)/generated from operations 13 (58) 362 3,197
Interest paid (496) (478) (982)
Tax (paid)/received (9) (127) 96
Net cash (used in)/generated from operating activities (563) (243) 2,311
Cash flow from investing activities
Purchase of property, plant and equipment (202) (32) (147)
Proceeds from sale of property, plant and equipment - - 22
Interest received - - 26
Intangible assets expenditure (185) (161) (388)
Net cash used in investing activities (387) (193) (487)
Cash flow from financing activities
Repayment of bank borrowings (1,000) (1,000) (2,000)
Proceeds from invoice discounting 454 671 81
Repayment of lease liabilities (488) (599) (1,036)
Dividends paid - - (260)
Net cash used in financing activities (1,034) (928) (3,215)
Net decrease in cash (1,984) (1,364) (1,391)
Cash and cash equivalents at beginning of period 8,167 9,565 9,565
Exchange losses on euro bank accounts (5) (9) (7)
Cash and cash equivalents at end of period 14 6,178 8,192 8,167
Notes to the consolidated interim financial statements
1. General information
Christie Group plc is a public limited company incorporated in and operating
from England. The Company's ordinary shares are traded on the AIM Market
operated by the London Stock Exchange. Christie Group plc is the parent
undertaking of a group of companies covering a range of related activities.
These fall into two divisions - Professional & Financial Services and
Stock & Inventory Systems & Services. Professional & Financial
Services principally covers business valuation, consultancy & agency,
business mortgages & insurance services and business appraisal. Stock
& Inventory Systems & Services covers stock audit & counting,
consulting, compliance, inventory preparation & valuation and hospitality
& software solutions.
2. Basis of preparation
The interim financial information in this report has been prepared using
accounting policies consistent with United Kingdom adopted IFRS. The financial
information has been prepared on the basis of IFRS that the Directors expect
to be endorsed by the UKEB as at the date of approval of the 31 December 2022
accounts.
The interim financial statements have been prepared in accordance with IAS 34
and the accounting policies applied in the financial statements for the year
ended 31 December 2021. Taxes on income in the interim periods are accrued
using the effective tax rate that would be applicable to expected total annual
earnings.
Going concern
Having reviewed the Group's budgets, projections and funding requirements to
31(st) December 2023, and taking account of reasonable possible changes in
trading performance over this period, particularly in light of Covid-19 risks
and counter measures, the Directors believe they have reasonable grounds for
stating that the Group has adequate resources to continue in operational
existence for the foreseeable future. Accordingly, the Directors continue to
adopt the going concern basis in preparing these interim accounts.
The forecasts for the combined Group projections, taking account of reasonably
possible changes in trading performance, indicate that the Group has
sufficient facilities and headroom to continue in operational existence to
31(st) December 2023. As a consequence, the Board believes that the Group is
well placed to manage its business risks, and longer-term strategic
objectives.
Non-statutory accounts
These consolidated interim financial statements have been prepared in
accordance with IAS 34 'Interim Financial Reporting'. The statutory accounts
for the year ended 31 December 2021 have been delivered to the Registrar of
Companies. The auditors reported on these accounts reported the following:
(1) their report was unqualified;
(2) did not contain a statement under either section 498(2) or section
498(3) of the Companies Act 2006; and
(3) did not include references to any matters to which the auditor drew
attention by way of emphasis.
The financial information for the periods ended 30 June 2022 and 30 June 2021
is unaudited.
3. Critical accounting estimates and judgements
Estimates and judgements are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances.
Critical accounting estimates and assumptions
The Group makes estimates and assumptions concerning the future. The resulting
accounting estimates will by definition, seldom equal the related actual
results. The estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below.
(a) Estimated impairment of goodwill and investments
Goodwill and investments are subject to an impairment review both annually and
when there are indications that the carrying value may not be recoverable. The
recoverable amounts of cash-generating units have been determined based on
value-in-use calculations.
(b) Retirement benefit obligations
The assumptions used to measure the expense and liabilities related to the
Group's defined benefit pension plans are reviewed annually by professionally
qualified, independent actuaries, trustees and management as appropriate.
Management base their assumptions on their understanding and interpretation of
applicable scheme rules which prevail at the statement of financial position
date. The measurement of the expense for a period requires judgement with
respect to the following matters, among others:
- the probable long-term rate of increase in pensionable pay;
- the discount rate; and
- the estimated life expectancy of participating members.
The assumptions used by the Group, may differ materially from actual results,
and these differences may result in a significant impact on the amount of
pension expense recorded in future periods. In accordance with IAS 19, the
Group recognises all actuarial gains and losses immediately in other
comprehensive income.
Where the present value of the minimum funding contributions exceed the
present value of the defined benefit obligation and the amounts are not
available as a refund or reduction in future payments, the Company will adjust
the retirement benefit obligation to match the present value of the minimum
funding contributions. The liability recognised in the Statement of Financial
Position, will reflect the present value of the minimum funding contributions.
A corresponding charge will be recognised in other comprehensive income, as
'effect of asset ceiling' in the period which they arise.
Critical accounting judgements and assumptions
The critical judgements made in the process of applying the Group's accounting
policies during the year that have the most significant effect on the amounts
recognised in the financial statements are set out below.
(a) Deferred taxation
Deferred tax assets are recognised to the extent that the Group believes it is
probable that future taxable profit will be available against which temporary
timing differences and losses from previous periods can be utilised.
Management judgement is required to determine the amount of deferred tax
assets that can be recognised, based upon the likely timing and the level of
future taxable profits together with future tax planning strategies.
(b) Revenue recognition
In determining the amount to be recognised on incomplete contracts it is
necessary to estimate the stage of completion and the amount of variable
consideration. An element of judgement and estimate is inherent in this
process.
3. Critical accounting estimates and judgements (continued)
(c) Property, plant and equipment
Depreciation is derived using estimates of its expected useful life and
residual value, which are reviewed annually. Management determines useful
lives and residual values based on experience with similar assets.
(d) Leases - estimating the incremental borrowing rate
The Group cannot readily determine the interest rate implicit in the lease.
Therefore, it uses its incremental borrowing rate (IBR) to measure lease
liabilities. The IBR therefore reflects what the Group 'would have to pay',
which requires an estimate when no observable rates are available.
4. Segment information
The Group is organised into two main business segments: Professional &
Financial Services (PFS) and Stock & Inventory Systems & Services
(SISS).
The segment results for the period ended 30 June 2022 are as follows:
PFS SISS Other Group
£'000 £'000 £'000 £'000
Total gross segment revenue 22,196 11,512 1,904 35,612
Inter-segment revenue (55) - (1,904) (1,959)
Revenue 22,141 11,512 - 33,653
Operating profit/(loss) 3,211 (934) - 2,277
Finance costs (284) (112) (152) (548)
Profit/(loss) before tax 2,927 (1,046) (152) 1,729
Taxation (333)
Profit for the period after tax 1,396
The segment results for the period ended 30 June 2021 are as follows:
PFS SISS Other Group
£'000 £'000 £'000 £'000
Total gross segment revenue 20,624 8,018 1,700 30,342
Inter-segment revenue (55) - (1,700) (1,755)
Revenue 20,569 8,018 - 28,587
Operating profit/(loss) 3,092 (1,285) - 1,807
Finance costs (527) (82) - (609)
Profit/(loss) before tax 2,565 (1,367) - 1,198
Taxation (367)
Profit for the period after tax 831
4. Segment information (continued)
The segment results for the year ended 31 December 2021 are as follows:
PFS SISS Other Group
£'000 £'000 £'000 £'000
Total gross segment revenue 43,882 17,480 3,454 64,816
Inter-segment revenue (110) - (3,454) (3,564)
Revenue 43,772 17,480 - 61,252
Operating profit/(loss) 7,565 (2,371) - 5,194
Finance costs (843) (239) (221) (1,303)
Profit/(loss) before tax 6,722 (2,610) (221) 3,891
Taxation (316)
Profit for the year after tax 3,575
Revenue recognised in the period has been derived from the provision of
services provided when the performance obligation has been satisfied.
5. Other income - government grants
The Group benefited from Government support due to the Covid-19 business
disruption, utilising the furlough scheme from its commencement which has
provided financial assistance towards employee salaries. Government grants
have been recognised in the Consolidated Interim Income Statement, under the
category Other income - government grants.
6. Taxation
Deferred tax assets have been recognised in respect of tax losses and other
temporary differences giving rise to deferred tax assets where it is probable
that these assets will be recovered.
7. Earnings per share
Basic earnings per share is calculated by dividing the profit attributable to
equity holders of the Company by the weighted average number of ordinary
shares in issue during the period, which excludes the shares held in the
Employee Share Ownership Plan (ESOP) trust.
Diluted earnings per share is calculated by adjusting the weighted average
number of ordinary shares outstanding to assume conversion of all dilutive
potential ordinary shares, once performance conditions are met. The Company
has only one category of potential dilutive ordinary shares: share options.
The calculation is performed for the share options to determine the number of
shares that could have been issued at fair value (determined as the average
annual market share price of the Company's shares) based on the monetary value
of the subscription rights attached to outstanding share options. The number
of shares calculated as above is compared with the number of shares that would
have been issued assuming the exercise of the share options.
Half year to Half year to Year ended 31 December 2021
30 June 2022 30 June 2021 £'000
£'000 £'000
Profit attributable to the equity holders 1,396 831 3,575
30 June 2022 30 June 2021
7. Earnings per share (continued)
Thousands Thousands 31 December 2021
Thousands
Weighted average number of ordinary shares in issue 26,065 26,220 26,071
Adjustment for share options 483 340 729
Weighted average number of ordinary shares for diluted earnings per share 26,548 26,560 26,800
30 June 2022 30 June 2021
pence pence 31 December 2021
pence
Basic earnings per share 5.36 3.17 13.71
Diluted earnings per share 5.26 3.13 13.34
8. Dividends
A final dividend in respect of 2021 of 2.00p per share, amounting to a
dividend of £520,000, was proposed by the directors and approved by the
shareholders at the Annual General Meeting on 15 June 2022, with the funds
paid to the registrar on 1 July 2022. The funds were transferred to
shareholders on 8 July 2022.
An interim dividend in respect of 2022 of 1.25p per share, amounting to a
dividend of £332,000, was declared by the directors at their meeting on 13
September 2022. These financial statements do not reflect this dividend
payable.
The dividend of 1.25p per share will be payable to shareholders on the record
on 7 October 2022. The dividend will be paid on 4 November 2022.
As at the 31 December 2021, the parent company had distributable reserves of
£4,747,000.
9. Trade and other receivables
Half year to Half year to Year ended
30 June 2022 30 June 2021 31 December 2021
£'000 £'000 £'000
Trade receivables 8,956 7,272 6,716
Less: provision for impairment of receivables (629) (704) (667)
Work in progress 2,007 1,510 2,040
Contract assets 466 342 213
Other debtors 1,228 1,463 1,225
Prepayments 1,427 2,012 2,975
13,455 11,895 12,502
The fair value of trade and other receivables approximates to the carrying
value as detailed above.
10. Share capital
30 June 2022 30 June 2021 31 December 2021
Ordinary shares of 2p each Number £'000 Number £'000 Number £'000
Allotted and fully paid:
At beginning and end of period 26,526,729 531 26,526,729 531 26,526,729 531
The Company has one class of ordinary shares which carry no right to fixed
income.
Investment in own shares
The Group has established an Employee Share Ownership Plan (ESOP) trust to
meet its future contingent obligations under the Group's share option
schemes. The ESOP purchases shares in the market for distribution at a later
date in accordance with the terms of the Group's share option schemes. The
rights to dividend on the shares held have been waived.
11. Retirement benefit obligations
The Group operates two defined benefit schemes (closed to new members)
providing pensions on final pensionable pay. The contributions are determined
by qualified actuaries based on triennial valuations using the projected unit
method.
When a member retires, the pension and any spouse's pension is either secured
by an annuity contract or paid from the managed fund. Assets of the schemes
are reduced by the purchase price of any annuity purchase and the benefits no
longer regarded as liabilities of the scheme.
The defined benefit obligation as at 30 June 2022 is calculated on a
year-to-date basis, using the latest actuarial valuation as at 30 June 2022.
There have been no significant market fluctuations and significant one-off
events, such as plan amendments, curtailments and settlements that have
resulted in an adjustment to the actuarially determined pension cost since the
end of the prior financial year. The defined benefit plan assets have been
updated to reflect their market value at 30 June 2022. However, significant
market fluctuations have caused a change in the discount rate applied to the
defined benefit obligation resulting in a decrease in the liability.
The amounts recognised in the statement of comprehensive income and the
movement in the liability recognised in the statement of financial position
have been based on the forecast position for the year ended 31 December 2022
after adjusting for the actual contributions to be paid in the period.
The obligation outstanding of £7,989,000 (30 June 2021: £14,997,000; 31
December 2021: £8,997,000) includes £1,100,000 (30 June 2021: £1,353,000;
31 December 2021: £1,312,000) payable to David Rugg by Christie Group plc.
The movement in the pension liability attributable to David Rugg's pension
arises from a change in the actuarial assumptions used and the discount rate
applied. There have been no changes to the amounts payable to Mr Rugg.
On an IAS 19 accounting basis, the underlying deficit in the Group schemes at
30 June 2022 was £2.5m (30 June 2021 £15.0m, 31 December 2021 £7.2m).
The terms of the schemes are that the Group does not have an unconditional
right to a refund of any surplus. During the period ended 30 June 2022, the
Group recognised an adjustment to the IAS 19 accounting basis under IFRIC14 of
£5.5m (30 June 2021 £nil, 31 December 2021 £1.8m), resulting in a deficit
included in the consolidated interim financial position of £8.0m (30 June
2021 £15.0m, 31 December 2021 £9.0m), which represented the present value of
future contributions under current funding plans.
The Group continues to work closely with the Trustee in managing pension
risks, with the defined benefit schemes closed to new members since 1999 &
2000.
In addition, the Group operates a defined contribution scheme for
participating employees. Payments to the scheme are charged as an employee
benefit as they fall due. The Group has no further payment obligations once
the contributions have been paid.
11. Retirement benefit obligations (continued)
The movement in the liability recognised in the statement of financial
position is as follows:
Half year to Half year to Year ended
30 June 2022 30 June 2021 31 December 2021
£'000 £'000 £'000
Beginning of the period 8,997 20,136 20,136
Expenses included in the employee benefit expense 215 208 417
Contributions paid (425) (128) (362)
Finance costs 52 130 259
Pension paid (29) (28) (60)
Actuarial (gains) recognised (821) (5,321) (11,393)
End of the period 7,989 14,997 8,997
The amounts recognised in the income statement and statement of comprehensive
income are as follows:
Half year to Half year to Year ended
30 June 2022 30 June 2021 31 December 2021
£'000 £'000 £'000
Current service cost 215 208 417
Total included in employee benefit expenses 215 208 417
Net interest cost 52 130 259
Total included in finance costs 52 130 259
Actuarial gains/(losses) 6,338 (5,321) 13,181
Effect of asset ceiling (5,517) - (1,788)
Total included in other comprehensive income 821 (5,321) 11,393
The principal actuarial assumptions used were as follows:
Half year to Half year to 30 June 2021 Year ended 31 December 2021
30 June 2022 % %
%
Discount rate 3.80 1.90 1.90
Inflation rate 3.30 3.20 3.40
Future salary increases 1.00 - 2.00 1.00 - 2.00 1.00 - 2.00
Future pension increases 2.25 - 3.50 2.20 - 3.40 2.25 - 3.60
Assumptions regarding future mortality experience were consistent with those
disclosed in the financial statements for the year ended 31 December 2021.
12. Trade and other payables
Half year to Half year to Year ended
30 June 2022 30 June 2021 31 December 2021
£'000 £'000 £'000
Trade payables 944 1,222 1,655
Other taxes and social security 2,825 5,040 2,838
Other creditors 1,227 557 625
Contract liabilities 282 289 280
Accruals 3,949 5,078 5,465
9,227 12,186 10,863
13. Note to the cash flow statement
Cash generated from operations
Half year to Half year to Year ended
30 June 2022 30 June 2021 31 December 2021
£'000 £'000 £'000
Continuing operations
Profit for the period 1,396 831 3,575
Adjustments for:
- Taxation 333 367 316
- Finance costs 548 479 1,303
- Depreciation 742 839 1,599
- Amortisation of intangible assets 195 186 383
- Loss/(profit) on sale of PP&E 6 - (14)
- Foreign currency translation 112 36 143
- Increase in provisions 8 37 291
- Payments to ESOT (60) (175)
- Movement in share option charge 30 30 62
- Movement in retirement benefits obligation (330) (52) (168)
- Movement in non-current other receivable - - (292)
Movement in working capital:
- (Increase)/decrease in inventories (8) 10 9
- (Increase) in trade and other receivables (953) (1,271) (1,878)
- (Decrease) in trade and other payables (2,077) (1,130) (1,957)
Cash (used in)/generated from operations (58) 362 3,197
14. Cash and cash equivalents
Half year to Half year to Year ended
30 June 2022 30 June 2021 31 December 2021
£'000 £'000 £'000
Cash and cash equivalents 8,565 9,785 8,167
Bank overdrafts (2,387) (1,593) -
6,178 8,192 8,167
The Group is operating within its existing banking facilities.
15. Related-party transactions
There is no controlling interest in the Group's shares.
During the period rentals of £256,000 (30 June 2021: £242,000; 31 December
2021: £485,000) were payable to Carmelite Property Limited, a company
incorporated in England and Wales, and jointly owned by The Christie Group
Pension and Assurance Scheme, The Venners Retirement Benefit Fund and The
Fitzroy Square Pension Fund, by Christie Group plc in accordance with the
terms of a long-term lease agreement.
16. Publication of Interim Report
The 2022 Interim Financial Statements are available on the Company's website
https://www.christiegroup.com (https://www.christiegroup.com)
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