REG - Creightons PLC - FY25 Audited Results and Notice of AGM
Wed 07:00
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RNS Number : 2019R Creightons PLC 16 July 2025
This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the company's obligations under Article 17 of
MAR. Upon the publication of this announcement via regulatory news service
this inside information is now considered to be in the public domain.
Creightons plc
Audited results for the year ended 31 March 2025 and
Notice of Annual General Meeting
Creightons plc ("Creightons", the "Company" or the "Group"), the British-based
beauty and well-being brand owner and manufacturer, is pleased to announce its
audited results for the year ended 31 March 2025 ("FY25").
Financial highlights
· Revenue increased by £0.9m (1.6%) to £54.1m (2024: £53.2m),
driven by private label sales growth
o Private label £29.2m (2024: £23.8m)
o Branded products £18.2m (2024: £21.0m)
o Contract manufacturing £6.7m (2024: £8.4m)
· Gross profit increased by £1.3m (5.8%) with gross profit margin
up 180 bps to 44.7% (2024: 42.9%)
· EBITDA(1) increased by 57.9% to £5.1m (2024: £3.2m)
· Operating profit (before exceptional items) increased by £2.0m
(129.6%) to £3.5m (2024: £1.5m)
· Profit after tax increased to £2.5m (2024: loss of £3.5m - includes
impairment of £4.4m) driven by higher revenue, improved gross profit margins,
in particular due to cost mitigation measures, labour shift rationalisation
and manufacturing efficiencies, and also reduced distribution costs
· Adjusted diluted earnings per share excluding exceptional items,
was positive 3.29p (2024: 1.42p)
· Net cash on hand(2) is positive £3.0m (2024: positive £2.2m).
· Proposed final dividend of 0.50 pence per ordinary share for FY25
(2024: 0.45p)
(1)Earnings before interest, tax, depreciation and amortisation, excludes
impairment of £4.4m in 2024
(2)Cash and cash equivalents less short-term element of obligations under
finance leases and borrowings
Operational highlights
Creightons transitioned to AIM on 31 March 2025 primarily to reduce the costs
of compliance and provide greater flexibility in regulatory requirements,
enabling management faster decision-making and to focus more on growth
opportunities.
During FY25, Creightons has successfully continued to implement remedial
measures to restore profitability, reduce costs and generate positive cash
flows, with actions including:
· Improved gross profit margin particularly through continuous
price monitoring of suppliers, along with gains in labour and manufacturing
efficiencies.
· Cost rationalisation to ensure administrative expenses remained
comparable to prior year at £17.9m (2024: £17.8m).
· Increased efficiency and capacity in factories to maximise
benefit of single shift work across sites
· Warehousing, picking and packing and logistics relocated back to
Peterborough, resulting in 20.8% decrease in distribution costs to £2.8m
(2024: £3.5m).
· Maintaining inventory levels, against a prior year reduction of
£2.0m.
o Inventory levels increased to £8.9m (2024: £8.2m) in line with revenue
growth, supporting continued sales momentum and ensuring product availability
to meet customer demand
· Targeted capital expenditure, enhancing operational efficiencies
and supporting scalable growth, including investment in upgrading operational
infrastructure
Posting of the Annual Report and Accounts and Notice of Annual General Meeting
("AGM")
The Company's annual report and financial statements for FY25, together with
its Notice of its 2025 AGM are now available on the Company's website at:
https://creightonsplc.com/investors/shareholder-documents/
(https://creightonsplc.com/investors/shareholder-documents/)
Copies will be posted later today to those shareholders who have elected to
receive hard copies.
The AGM is to be held at the Company's registered office, Potter & Moore
Innovations Ltd, 1210 Lincoln Road, Peterborough, PE4 6ND on 28 August 2025 at
11:00 a.m.
For enquiries, please contact:
Creightons
plc info@creightons.com
(mailto:info@creightons.com)
+44 1733 281058
Paul Forster, Chairman
Philippa Clark, CEO
Zeus (Nominated Adviser and
Broker)
+44 203 829 5000
David Foreman / Ed Beddows (Investment Banking)
Nick Searle (Sales)
Chairman's statement
I am pleased to present our Annual Report for the year to 31 March 2025.
Significant progress has been made in repositioning the business and
establishing a strong foundation to support sustained performance improvements
and long-term value creation for our stakeholders.
Philippa Clark and her team have continued to implement the turnaround plan
which has resulted in the material improvement in operating results for the
year ended 31 March 2025. I am encouraged by improvements across all key
metrics, with revenue, gross margins, operating profit, profit margins, and
earnings per share all trending positively.
Revenue has grown despite a difficult market environment, where challenges
faced by certain customers have had an adverse effect on overall revenue
performance. In addition, a competitive market for high-quality sales and
marketing personnel resulted in redirecting resources to capitalise on
immediate opportunities with existing customers. This highlights the strength
of our multi sales stream approach where resources were directed to maximise
the opportunities arising in a fast-changing retail environment.
Results and performance
In the year ended 31 March 2025 (FY 2025) revenue increased by 1.6% to
£54.1m. This growth came from our private label revenue stream which more
than offset falls in our branded and contract revenue streams.
The focus;
· to improve margins, though a combination of price repositioning,
cost reduction and labour productivity has proved successful with gross profit
margins improving by 5.8% to £24.2m and gross profit margin percentage by 180
bps to 44.7% and,
· on cost control resulting in distribution costs reducing by
£0.7m (20.8%) to £2.8m and administration costs remaining in line with last
year.
The result is a £2.0m (129.6%) improvement in operating profit before
exceptional items to £3.5m. The operating profit before exceptional costs as
a percentage of revenue has improved by 360 bps to 6.5%.
The Group has continued to generate significant cash from operations, although
the planned increased investment in inventories to optimise customer service
levels utilised £0.6m of working capital. The positive cash generation
allowed the Group to repay all of the outstanding long term loan of £0.5m and
fund a £0.3m dividend payment. Net cash on hand (cash and cash equivalents
less short-term borrowing and lease liabilities) improved by £0.8m to £3.0m.
Board of Directors and Corporate Governance
Creightons plc successfully transferred its listing from the main market to
AIM on 31 March 2025 following the EGM on 31 March 2025 at which 99.85% of the
shareholders voting, voted in favour of the move. The Board believe that this
transfer will be in the long-term interest of all stakeholders. Following the
move to AIM the Group has adopted the QCA Corporate Governance Code with
effect from 01 April 2025. This Annual Report will be the last report under
the UK Corporate Governance Code.
The Group appointed Zeus as its Nominated Advisor (NOMAD) and broker following
the move to AIM. I would like to thank the team at Beaumont Cornish, our
long-standing Sponsor on the Main Market, for their valuable partnership and
the excellent support and guidance they have provided, particularly throughout
the transition period.
The Board has evolved over the past year as we move towards one that is
aligned with the requirements of the AIM market and the QCA Corporate
Governance Code.
· Mr William McIlroy, who had served as a director of the Company
since 1999 as well as Executive Chairman and Chief Executive Officer, resigned
in order to devote more time to his family on 10 December 2024. I would like
to re-iterate my sentiments made at the time and thank him for his steadfast
support and contribution to the Company over the years.
· Mr Paul Watts was appointed as an Independent Non-Executive
Director on 29 January 2025. I am positive that his experience and expertise
as a senior capital and assurance partner at RSM and as a director of the
Quoted Companies Alliance will be a great asset to the Board. Paul
immediately joined our Audit and Risk Committee (as Chair) and Remuneration
Committee.
· Mrs Jemima Bird was appointed as an Independent Non-Executive
Director on 31 March 2025. Jemima's marketing experience and expertise in
Independent NED roles will benefit the Board and the future development of the
Company. Jemima immediately joined the Remuneration Committee (as Chair) and
Audit and Risk Committee.
· Mr Qadeer Mohammed was appointed Chief Financial Officer on 1 May
2025. Qadeer has worked as the senior financial executive for two years
developing a close working relationship with Philippa as Chief Executive
Officer (CEO). He has proven he has the skills and attributes to contribute to
the continued strategic and operational development of our business.
In addition, One Advisory were appointed as our Company Secretary replacing
Saxon Coast Consulting on 4 December 2024.
The move to AIM and the adoption of the QCA Corporate Governance Code was the
catalyst for a wholesale review of our corporate governance practices.
Principal amongst these changes were:
· Revised Statement of Matters Reserved for the Board.
· Updated terms of reference for the Audit and Risk Committee with
the membership consisting of two Independent NED's and one non-independent
NED.
· Updated terms of reference for the Remuneration Committee with
the membership consisting of two Independent NED's and one non-independent
NED.
These policies can be reviewed on our updated corporate website
www.creightonsplc.com (http://www.creightonsplc.com) .
The Board will propose a resolution to amend the Articles of Association at
the forthcoming Annual General Meeting. This amendment will the allow General
Meetings, other than the Annual General Meeting, to be held following 14 days'
notice and allow the Board of Directors to change the Company name, following
the passing of a Board resolution where three quarters of the directors
present vote in favour
Strategic development
The Board has recently undertaken a review of strategy concentrating on how to
build on the company's key strengths and accelerate revenue growth to deliver
continued improvements in return for shareholders whilst protecting the
interests of all stakeholders.
The key outcomes from this strategy are that the Group will:
· Concentrate resources on developing existing business and will
only consider acquisition opportunities if the opportunity offers significant
immediate benefit to stakeholders.
· Allocate additional resources to a team dedicated to developing
the timely launch of 'fast follow' products and better capture market
opportunities. This new multi-disciplinary team will develop and launch
product at speed to meet fast-emerging market trends. The products could be
sold under our own brands, as private label, or retailer specific brands.
Existing revenue streams will remain fully resourced to ensure there is no
negative impact on the remaining business.
· Invest resources in sourcing finished products on a global basis
to increase our capability to supply complementary product that cannot be
manufactured cost effectively in house.
· Increase targeted marketing investment and retailer support on
its core brands to accelerate revenue growth by increasing repeatable sales
volumes with existing customers and support new listings. This spend will be
closely managed to ensure an ongoing acceptable return on the investment and
will be modified to maximise profitable revenue growth
· Continue to invest in the core manufacturing of liquid products
(creams, lotions, gels and detergent based) and alcohol products (perfumes,
edt's and colognes), to improve output and productivity
· Refocus the digital transformation team following the successful
implementation of a new warehouse management system, to a project to replace
our aging main business platform with a modern alternative. The aim of the
project will be to deliver operational improvements whilst securing the
long-term development of a secure business system environment
Dividend
Following the re-introduction of the dividend last year and in line with a
policy of paying a progressive, sustainable dividend which is supported by
profits and cash generation, the board has decided to recommend to
shareholders a dividend to 0.50 pence per share (2024: 0.45p). This represents
a 11.1% increase on last year.
The Company is pleased to confirm its provisional dividend timetable, subject
to the successful passing of certain resolutions at its AGM:
· Ex-Dividend Date: 24 July 2025
· Record Date: 25 July 2025
Payment Date: 11 September 2025
Summary and Outlook
I am pleased with the results for the year with the Executive team delivering
on the goals of returning the Group to pre-covid levels of profitability and
to delivering revenue growth. This puts the Group in a very strong position to
move forward.
The next year will not be without its challenges largely a result of factors
outside the Group's control. The key factors being:
· Managing the impact of the increase in employers' national
insurance and the national minimum wage, together with associated pay
increases to maintain pay differentials will cost the Group £0.9m. Our
customers are facing similar challenges therefore, it is proving difficult to
raise sales prices in the current market environment to offset these rising
employment costs. The project to improve performance to alleviate the impact
is ongoing.
· Customer credit risks. The Group is prioritising trading with
resilient customers in today's tough market, while approaching others more
cautiously as their future potential is assessed. The Executive team is
closely monitoring risk and return.
· The impact of increased US tariffs on our direct and indirect
sales to US customers, which approximate to £0.4m of revenue, will not be
material. The Group will carefully monitor the knock-on impact of the tariff
situation, particularly regarding product diverted to the UK, and use our new
Far East sourcing team to take advantage of opportunities to increase revenue
and reduce costs.
Whilst there are significant challenges, the Group is in an excellent position
to manage the downside risks and take advantages of any opportunities. The
proposed investment in sales, marketing, product sourcing and development will
ensure the Group can take advantage of more opportunities over the coming
year. The Board will continue to work closely with the Executive team to
deliver and revise the strategy to grow revenue and profits.
Finally, I would like to thank all our employees, customers and suppliers who
have been instrumental in the continued success of the Group.
Chief Executive's Statement
Driving Performance, Creating Value
I am pleased to report that the Group has achieved a strong operating
performance in the year. Group revenue increased by 1.6% to £54.1m (2024:
£53.2m), a gross margin of 44.7% (2024: 42.9%), resulting in £2.3m increase
in adjusted profit before tax (adjusted for exceptional items) of 194.1% to
£3.5m (2024: £1.2m).
The results represent the key objectives of continuing to focus on strong
business fundamentals and returning the Group to growth. This is despite
market conditions remaining challenging with ongoing dampened consumer
confidence, increasing costs and the headwinds of external economic factors.
Key achievements have been made in margins, continued cost control, positive
cash generation and notably revenue improvement. This demonstrates the ongoing
efforts to ensure the Group continues to deliver a sustainable, performance
focused business.
FY25 has been a year of disciplined performance, delivering increased value,
improving operational efficiency, investing in our people, and refining the
strategic plan and priorities to support long-term, sustainable growth.
Ongoing investment in the areas that differentiate us; research and
development, market and product expertise, and talent development continues to
strengthen our core business, securing the foundation for future innovation
and value creation across all stakeholder groups.
We have demonstrated the ability to deliver results in an increasingly
fast-paced and competitive sector, where flexibility and adaptability are
essential. The capacity to respond to market dynamics while maintaining high
standards of execution remains a key strength. Our diversified yet
complementary revenue streams continue to serve the business well in
navigating the ongoing challenges of both UK and global retail environments.
Looking ahead, the focus remains on broadening these streams further to
reinforce and enhance the resilience of the business.
Revenue stream performance
Private Label
Private label sales delivered the strongest revenue growth across all
channels, increasing by 22.9% to £29.2 million (2024: £23.7 million).
Creightons remains a leading private label supplier in the UK, underpinned by
deep category and market knowledge, end-to-end product development
capabilities, manufacturing expertise, and consistent delivery of high-quality
products.
Private label continues to be both margin-enhancing and brand-strengthening
for retailers, while offering consumers a compelling value proposition. As a
result, it remains a strategic priority for major UK retailers, particularly
in the current economic climate where value, quality, and differentiation are
paramount.
Beyond category expertise, formulation aesthetics, including texture
innovation and on-trend packaging formats, have become increasingly important
in winning new business and retaining customer loyalty. Creightons continues
to lead by excelling across all these dimensions, supported by strong
performance in inventory management, forecasting, service levels, cost
control, product quality, and technical compliance.
This year's growth was further supported by the addition of two key UK
retailers to our private label customer base. These new partnerships are
already proving to be positive contributors in terms of both margin and
volume.
Margin performance in the private label channel remains strong, driven by
continuous product cost engineering and ongoing improvements in sourcing,
procurement, and manufacturing efficiencies.
Brands
Overall Brands have seen a reduction of sales revenue 13.5% to £18.2m (2024:
£21.0m).
The process of reducing and repositioning the branded portfolio by phasing out
underperforming brands and products has continued into this year, primarily
affecting the UK discount channel and select international markets. Although
new pricing strategies, product launches, and new product development (NPD)
have been introduced, the full benefits have yet to materialise due to the
timing of retailer launch windows and the inherent lead times associated with
bringing new products to market.
Additionally, a comprehensive review of trading partners across several
international markets has been undertaken. This has necessitated a temporary
reduction in sales as we strategically reposition our brands and concentrate
on market opportunities with greater long-term growth potential.
Despite the overall sales reduction, there have been encouraging gains with
our priority 'must-win' brands through targeted investments and partnerships:
· Feather & Down is benefiting from its strategic partnership
with Boots in the UK, which will result in increased shelf space, expanded
store presence, and the launch of a new product range in Summer 2025. The
brand has also successfully entered its first international market, securing
listings with several retailers in the UAE.
· TZone continues to expand its footprint in the UK, achieving
additional store placements and listings, with plans already confirmed for its
first international market entries in FY25.
· The Curl Company has gained significant traction across three
priority international markets, with expanded product listings and extended
store distribution.
· A comprehensive relaunch of Creightons Haircare in Q4 in the UK,
aimed at improving margins and strengthening its retail market position.
The strategic refocus of the Emma Hardie brand over the past year has led to a
modest revenue decline of £0.2m, totalling £3.0m for the period (2024:
£3.2m). However, the brand has achieved a positive and profitable
contribution to the Group for the first time since its acquisition. This
milestone was reached despite the commencement of investment in the Chinese
market during Q4, ahead of anticipated sales return in FY2026. Additionally,
increased investment in digital sales during the period has begun to yield
growth in this channel, with an increase of 7%. Continued emphasis on entering
the travel retail sector and planned new product launches in Summer 2025 are
expected to provide a platform for growth throughout FY2026 and beyond.
Contract Manufacturing
The 20.3% decline in revenue to £6.7m for the period (2024: £8.4m) reflects
ongoing uncertainties surrounding the performance of several brands
manufactured by the Group, including the discontinuation of one sizeable brand
by its owner. This particular revenue stream is not currently a strategic
priority for the business. As such, we will continue to review existing
customer relationships to ensure they contribute positively to the Group's
overall margin and profitability.
Digital and Social (Brands)
The digital channel remains a strategic priority for a number of brands in the
beauty marketplace, and notably for Emma Hardie on its own .com.
(www.emmahardie.com (http://www.emmahardie.com) ). Throughout the year, we
have continued to strengthen our presence across digital and social platforms,
resulting in an overall increase in digital channel sales of 7%.
This growth has been driven primarily by the Feather & Down and Emma
Hardie brands, whose pricing strategies are well aligned with digital consumer
expectations while also delivering commercially for the business. Digital
sales now account for 60% and 66% of total brand sales for Feather & Down
and Emma Hardie respectively, up from 48% and 52% in the prior fiscal year.
This includes performance across Amazon, beauty-focused e-commerce platforms,
traditional retail .com sites, and the brands' own direct-to-consumer
websites.
The higher-margin profile of digital sales makes this a core area of focus for
ongoing investment. We continue to allocate resources across the team,
marketing spend, and social commerce agencies to further support brand
building and commercial growth in this channel.
In line with our strategy, Amazon platforms in the UK and Germany, along with
TikTok Shop, remain in the early stages of development. We are currently
applying a test-and-learn approach to understand the unique dynamics and
consumer behaviours within these channels and markets. The extension of
product and brand listings on additional marketplaces moving forward are also
a key objective into 2026.
Research and Development
At the core of Creightons' strategy is the unwavering commitment to R&D,
which remains a fundamental driver of our growth, differentiation, and
long-term relevance within the beauty industry. The ability to translate
consumer needs into effective and innovative solutions is central to our value
proposition and continues to earn recognition from both our retail partners
and end consumers.
Our R&D and product teams have been instrumental in securing many of the
business wins achieved this year with existing and new Private Label retail
customers. This includes expanding our skincare expertise through the
development of new textures and incorporation of trending performance
ingredients, entering the private label haircare market with treatment and
styling products, and continually refining our SPF formulation capabilities.
R&D has also played a pivotal role in some exciting new brand
developments, including the launch of a new sub-range of Feather & Down
products and Emma Hardie's first NPD launch since acquisition, both scheduled
for the UK market in Summer 2025. Additionally, extensions to the Balance
Active Formula and TZone skincare brands have introduced novel textures and
product formats, helping us maintain a competitive edge in the fast-evolving
mass skincare category.
Operationally, the R&D team undertakes several critical functions
essential to the successful delivery of new products to market. These
activities demand substantial laboratory time and resources and include:
· Addressing the challenges posed by rising raw material costs
while maintaining product efficacy, a crucial factor in meeting the
expectations of mass-market retail and consumer demands.
· Sourcing and validating new materials and ingredients to ensure
quality and innovation.
· Coordinating and executing comprehensive testing protocols,
including consumer trials, to guarantee product performance and safety.
Looking forward, we will maintain R&D at the heart of the business,
leveraging insights, trends, and ideas to develop trusted products. The team
remains focused on exploring new categories and technologies, with ongoing
investments in SPF skincare, advancing skincare technologies, performance
haircare (specifically styling and treatment), and fine fragrance.
Manufacturing and Operations
Manufacturing and operations functions remain fundamental pillars in
delivering Creightons' core values of Quality, Innovation and Service to our
customers and partners. In a highly competitive and rapidly evolving beauty
industry, agility and reliability in manufacturing are critical to our
continued success.
During this trading period, several key initiatives have driven progress:
· Launching a comprehensive digital transformation program to
leverage technology and enhance daily operational efficiency - including
automated document management, trialling a paperless management system on the
production floor (full roll out to each production line on both sites planned
Q2 FY2026), a new formulation management system.
· Implementing a Warehouse Management System (WMS). A timely and
necessary investment designed to significantly improve supply chain
efficiencies.
· Making targeted investments in manufacturing machinery to expand
both our capabilities and production capacity, supporting future growth.
· Focusing on workforce development through enhanced training
programs and progression incentives to build a skilled and motivated team.
The relentless focus of our teams on improving manufacturing efficiencies has
enabled us to maintain production targets with a single shift, while adopting
a flexible approach to scaling labour as needed. This adaptability ensures our
operations remain agile and responsive to changing demands.
Cost efficiency remains at the heart of all manufacturing and operational
activities. Maximising labour productivity at every stage of the process is
essential to stay competitive amid rising labour costs.
Following the repatriation of the majority of our inventory in-house last
year, the investment in the Warehouse Management System was critical to
controlling overheads, improving speed and accuracy, maximising storage
utilisation, and facilitating scalable growth. Thanks to the dedication of our
team, we have accelerated the implementation timeline, with the system going
live in June 2025. We anticipate realising operational benefits from the
second half of the fiscal year onward.
Procurement savings continue to be a priority, with smart buying aligned to
inventory holding objectives and a persistent focus on sourcing cost-effective
raw materials and packaging. These ongoing efforts are vital given the
fast-paced nature of the beauty sector.
Continuous improvement in manufacturing and broader operations is embedded in
our business culture to ensure we remain competitive and relevant in an
ever-changing market.
The Future and Our Strategy
The board has implemented an annual review process of current year strategic
objectives and its three-year strategic pillars. The plan was reviewed in
March 2025, driving key activities and objectives for the coming year and
beyond to drive shareholder value through revenue growth, profit before tax
(PBT) and diluted earnings per share.
A continual review of the market, our customers strategies, category and
product opportunities coupled with our experience and knowledge is undertaken
throughout the year in order to ensure that our key strategic objectives are
relevant and achievable. These are reviewed and monitored with the main board
and senior team to ensure consistency in approach. The goal is to deliver a
consistent, stable business that delivers increasing value for all
stakeholders.
Overall, the strategy of pursuing a multi-revenue stream, multi-channel
approach to the market and with a broad multi-category product offering
continues to serve us well, enabling the business to meet the varying demands
of customers and consumers.
1. Build Brands
Focus on building 'must win' brands
· Expand UK distribution footprint - there are additional
distribution gains to be had.
· Invest in additional sales resource to grow and expand
international markets.
· Fill the 'white space' where possible, ensure propositions are
clear and represent clear customer need states.
· Increase marketing spend on 'must win' brands with a focus on
increasing brand awareness in all channels to fuel brand growth.
Expand with New Brands - Developed or Acquired
· Develop in-house where possible to add maximum stakeholder value.
· Acquire where the fit is right and adds to the Group's total
Brand portfolio and delivers additional business value.
Create a Fast Follow Brand/Product Team
· Enable specific focus on delivering revenue generating
opportunities on fast trend opportunities with key retailer partners.
· Invest in dedicated team within the brand team to deliver this
revenue stream.
Product Diversification
· Invest in sourcing third party manufactured product to extend
brand and private label offer to enhance range appeal and contribute to
revenue growth.
Build on Digital Platform Brand Sales
· Ongoing development of Amazon Vendor and Amazon Seller including
developing selected international markets.
· Investment into our own .com sites where the brand positioning
will succeed.
· Grow relationships with key pure beauty players where the brand fit
makes sense.
2. Grow Private Label Share
· Retain the dominant position in UK supply.
· Focus on margin positive products.
· Work with the best in class retailers.
· Ensure Research and Development (R&D) category development
drives new sales opportunities.
· Drive new Category Expertise to extend and grow supply - short
term SPF, more advanced skincare and fragrance categories.
· Product Diversification - benefit from third party investment in
sourcing third party manufacturer product where retailer and market
opportunity exists.
3. R&D Focused Business
· Essential for growing the Private Label business by entering new
product types and related categories.
· Speed to Market focus.
· Meeting and anticipating consumer needs - for both Brand and
Private Label divisions.
· Remain at the cutting edge of trend, ingredients, product
textures and formats.
· Evaluation of materials with low carbon footprint for more
sustainable products.
4. Maintain Core Stable Foundations
· Continual review of ensuring our cost footprint fits and sales
and profit profiles
· A strong value proposition for our customers and consumers
· Customer-centric focus.
· Data driven decision making throughout all core functions.
· Ensuring adaptability and invocation are in the DNA of the
business.
5. Well Invested Manufacturing and Capabilities
· Output, capacity and extended capabilities focused capital
investment.
· Ensure the Group's costs and asset base match demand,
environmental and safety requirements.
· Digital transformation utilising IT/AI/Digital technologies to
enhance productivity, data and systems management.
6. Develop Teams and People
· Structured training programmes throughout the operational
functions couple with grading system for improvement and advancement.
· Apprenticeship Programme - making best use of opportunities to
skill up new and aspiring talent
· Graduate Training Programme - an ongoing and successful programme
for nurturing new talent across all business functions.
· Individual mentoring and external coaching for key roles and
individuals to develop future leaders.
7. Deliver for Shareholders
· By aligning our people, products, and purpose with evolving
market needs and global trends, we aim to outperform expectations, increase
returns, and build a resilient business that thrives over time. This aim to
be achieved through sustained revenue growth, operational excellence, and
market responsive R+D to deliver for our customers.
Over and above the core strategic pillars there is a continued commitment to
meet environmental and sustainability targets
· The business has committed to SBTi validated emissions reduction
targets by 31 December 2026. Please see further detail outlined in the CRFD
report of the full accounts.
· Scope 1 and 2 emissions will reduce by 42% and Scope 3 emissions
by 25% by 2030.
· For FY24/25 we have seen a decrease in scope 1 and 2 emissions of
18.5% year on year and 30.8% from our base year.
· We have just completed the 11th year of holding the RSPO supply
chain accreditation.
· Now sourcing 99.9% of our palm derivatives from RSPO sustainable
sources.
· For FY24/25 the amount of recycled plastic in our packaging has
increased to 255.8 tonnes, 23.2% of to the total amount of plastic bought, an
increase of 3.7%.
· We completed the climate change module for the Carbon Disclosure
Project (CDP) in FY24/25 and scored a B. Please see further detail outlined in
the CRFD report of the full accounts.
Summary
Whilst trading conditions remain challenging amid macroeconomic uncertainties
and shifting consumer trends, the business delivered a solid financial
performance. Returning to growth whilst achieving improving margins, positive
cash generation and keeping costs in line with revenue is a result of the
team's continued disciplined focus and clear direction.
As we look ahead, manufacturing agility and innovation are more fundamental
than ever as consumers continue to demand newness and performance, trend-led
product. The strategy of pursuing a multi-channel approach to the market and a
broad multi-category product offering continues to serve us well during both
favourable and uncertain economic times.
Looking ahead, our innovation pipeline remains a key growth driver, coupled
with extending our manufacturing and sourcing capabilities in product type and
format within existing and new distribution channels. These are priorities
shared across all teams and are vital in achieving our overall strategic goals
of revenue growth, strong financials and positive returns for shareholders.
I would like to thank all of our very dedicated teams for their continued hard
work and commitment along with the ongoing support of all of our stakeholders
and the Board. I am confident that with our talented teams and unwavering
commitment to deliver, we are well-positioned for continued success in the
evolving retail and beauty product landscape.
Financial Report
Overview of Financial performance
The Group's ongoing execution of the strategic priorities has led to improved
profitability, driven by revenue growth and margin expansion across both gross
and operating levels. Revenue increased by £0.9m to £54.1m (2024: £53.2m),
led by private label sales growth. Gross profit margin increased by 180 bps to
44.7% from 42.9%, whilst Operating profit margin (before exceptional items)
increased by 360 bps to 6.5% (2024: 2.9%). The resulting impact led to an
increase in adjusted profit before tax (adjusted for exceptional items in the
previous year) of 194.7% to £3.5m (2024: £1.2m). The Group remains committed
and focused on delivering profitable growth, supported by continued sales
momentum and expansion, operational efficiency and cash generation.
The Group continues to maintain a disciplined focus on cost rationalisation to
ensure operational efficiency in line with increased activity. This approach
has enabled more effective management of direct and indirect labour costs,
administrative expenses, and warehousing and distribution overheads. Ongoing
manufacturing efficiencies have further contributed to the effective
management of both cost of sales and fixed overheads, ensuring scalable and
sustainable operations. As a result of this, the operating profit before
exceptional items increased by £2.0m to £3.5m (2024: £1.5m).
Despite a significant improvement in underlying operating performance, with
EBITDA (before exceptional items - impairment) increasing to £5.1m (2024:
£3.2m), the cash generated from operating activities decreased to £3.9m
(2024: £6.1m). This decline was primarily driven by a working capital outflow
of £1.2m, compared to an inflow of £2.6m in the prior year. The outflow was
attributable to increases in inventory (£0.7m) and trade receivables
(£1.2m), partially offset by an increase in trade payables (£0.6m). In
contrast, the prior year benefited from reductions in inventory and trade
receivables of £2.0m and £2.2m respectively, although trade payables
decreased by £1.6m. Additionally, a £1.0m tax outflow was incurred in the
current year due to the Company falling within the Quarterly Instalment
Payment (QIP) regime. In the previous year, no tax payment was made as the
Company benefited from an overpayment in prior periods, resulting in a payment
on account that covered the tax liability.
The Group has utilised the cash to reduce its debt exposure with net gearing
to negative 1.7% (2024: positive 3.5%). Net cash on hand has increased by
£0.8m to positive £3.0m (2024: £2.2m).
Revenue
Overall Group sales were £54.1m for the year ended March 2025 (2024: £53.2m)
representing an increase of £0.9m.
The sales generated by each revenue stream are;
2025 2024 Movement
£000's £000's
Branded products 18,176 21,020 Decrease of 13.5%
Private label 29,154 23,727 Increase of 22.9%
Contract manufacturing 6,720 8,431 Decrease of 20.3%
Other 16 16 -
Total 54,066 53,194 Increase of 1.6%
Please refer to the Chief Executive's statement on Revenue movements.
Gross profit margin
The ongoing challenging macroeconomic environment has led to inflationary
pressures across labour, raw material (components, and commodity prices) and
transport (global and domestic) costs, eroding the Group's gross profit
margins. The Group implemented systems and processes to monitor Cost Price
Increase ("C.P.I") across all categories of supply. This proactive approach
has enabled the Group to mitigate margin erosion through a combination of
actions, including product re-engineering, reformulation, targeted price
increases, and SKU rationalisation to streamline offerings and focus on
higher-margin products.
Gross margin has seen an upward trend in recent years as a result of proactive
measures taken by management in the areas of customer price increases, cost
mitigation and product re-engineering and reduced labour costs due to shift
rationalisation and efficiency improvements. Additionally, the business has
reviewed its product portfolio and ensured SKU's not achieving the desired
level of contribution margin were exited.
Distribution costs and Administrative expenses
Distribution costs have decreased by 20.8% to £2.8m (2024: £3.5m) despite an
increase in revenue. This reflects the ongoing benefits of actions implemented
in the prior year, including the decision to bring the picking and packing of
finished goods in-house and exit third-party logistics arrangements where
possible. Improved management of inventory levels has further supported these
efficiencies, resulting in a £0.4m year-on-year reduction in underlying net
costs associated with outsourced warehousing and third-party storage. This had
a positive impact on both costs and the efficiencies of the business going
forward. Additionally, a change in the sales mix has contributed to a
reduction in outbound freight costs by £0.3m. A 2.8% decrease in
international sales to £8.2m, has helped lower overall logistics expenses.
Administrative expenses rose by £0.1m to £17.9m (2024: £17.8m), despite
revenue increasing by £0.9m. This growth in revenue was achieved without a
material increase in overheads, demonstrating a lean and efficient cost
structure. The cost reductions seen in previous years are directly
attributable to cost rationalisation and manufacturing efficiencies
implemented across the Group. The Group has achieved overhead savings across
most cost categories through efficient utilisation of its manufacturing
facilities. Production continues to be maintained on a single shift, with no
impact on output or the ability to meet customer demand. Operating on a single
shift also provides spare capacity, offering flexibility to scale output as
required.
Exceptional items
There were no exceptional items for the year ended 31 March 2025.
In the previous year, redundancy costs incurred of £0.02m were in respect of
the closure of the second shift at Peterborough.
As required by IAS 36, the Group reassesses its capitalised intangible assets
for impairment on an annual basis. Following the difficult trading years of
the Emma Hardie subsidiary in the prior year, management assessed that the
brand value acquired on acquisition in relation to Emma Hardie was to be
impaired by £4.4m in the year ended 31 March 2024. This was shown as a
separate line item in the Consolidated profit and loss account as it is an
expense that is not in line with the normal trading operations of the Group.
The impact of this impairment was not cash impacting and is an entry that
reduced the intangible assets (Brand value for Emma Hardie) on the balance
sheet with a corresponding entry in the Consolidated income statement. The
associated goodwill and deferred tax liability was derecognised from the
balance sheet.
Operating profit and EBITDA
Operating profit (before exceptional items) increased by £2.0m to £3.5m
(2024: £1.5m). As a direct result of strong operating performance, the Group
has generated EBITDA of £5.1m (2024: £3.2m).
Tax
The Group's effective tax rate for the period exceeds the standard headline
rate of 25% and shows an increase from the comparative period, where the rate
was -7.6%. This is due to several factors but largely a result of legislative
changes to the Research and Development tax relief.
The Group continues to benefit from available R&D tax incentives; however,
due to recent changes, these no longer reduce the Group's effective tax rate,
a trend seen across the industry and among similar businesses.
In addition, a sizable amount of long-term share incentives, which were
previously expected to give rise to a future tax deduction, lapsed during the
period. This one-off event has contributed to the increased effective tax rate
for the Group during the period.
The Group continues to monitor the effective tax rate and overall tax
strategy of the business and is exploring opportunities to improve the tax
efficiency of the group's asset base by ensuring tax relief is maximised by
the Group in respect of qualifying assets.
Profit after tax
The Group reported a profit after tax of £2.5m for the year ended 31 March
2025 (2024: loss £3.5m).
Earnings per share
The diluted earnings per share increased to positive 3.29p (2024: negative
5.15p). Share options were excluded from the earnings per share calculation in
the consolidated income statement for the prior year due to their
anti-dilutive effect on the loss after tax attributable to equity holders. The
EPS in the previous year had been adversely impacted by the reduction in
profit after tax including the exceptional costs of £4.4m. The main
exceptional item in the previous year pertaining to the brand impairment of
Emma Hardie was a non-cash impacting item. Adjusted diluted earnings per share
excluding exceptional items for the previous year was 1.42p.
Research and development
The Group undertakes significant research and development (R&D) to
identify new brands, proprietary products and improved formulations to
existing products that address expected market trends to maximise the Group's
market share and deliver new opportunities for growth. The spend in the year
on research and development was £0.6m (2024: £0.8m).
The Group's principal focus in R&D is maintenance and development of
brands and products in its existing markets and product ranges. As our brands
evolve the Group now develops ranges which involve greater innovative
development and claims substantiation which has changed the nature of our
research and development over recent years. One impact of this development is
improved claims for research and development tax relief.
Cash on hand and working capital
Net cash on hand (cash and cash equivalents less short-term element of
obligations under finance leases and borrowings) is £3.0m (2024: £2.2m). The
improvement in cash of £0.8m year on year is mainly attributable to continued
improvements in profit from operations and reduction in borrowings.
Inventory
Inventory on hand increased by £0.7m to £8.9m (2024: £8.2m) during the year
to March 2025. Average inventory holding has been maintained throughout the
year with the closing balance of inventory reflecting a timing of
manufacturing quantities held for customer product launches in the new year.
Third-party storage and outsourced warehousing saw a £0.4m year-on-year
reduction in underlying net costs as a result. Purchasing quantities and
manufacturing batch sizes to reduce inventory holding on both raw materials
and finished goods continue to be implemented.
Return on Capital Employed
The increase in operating profit before exceptional items coupled with the
decrease in net equity and the reduction in borrowings has improved return on
capital employed by 700 bps from 5.9% to 12.9%. This is in line with the
Group's objective to provide a stable base for growth. The Group continues to
look for opportunities to invest in brands that will help drive faster growth
in profits.
Net gearing
With the increase in cash generation and reduction in cash outflow the
business was able to utilise the cash generated to improve its liquidity by
reducing its reliance on short term borrowings. Additionally, the Group has
reduced its gearing by making an overpayment in August 2024 to pay in full the
term loan. This resulted in a negative Net gearing of 1.7% (2024: positive
3.5%) highlighting low leverage.
Dividend
The Director's propose a final dividend for the year ended 31 March 2025 of
0.50 pence per ordinary share (2024: 0.45 pence per share). The Group has
exhibited strong operational performance and generated cash which in turn has
improved the Group's liquidity and reduced its gearing. This is consistent
with the Directors' objective to align future dividend payments to the future
underlying earnings and cash requirements of the business. The total dividend
paid in the year ended 31 March 2025 was £0.3m (2024: £nil).
Principal risks and uncertainties
The Board regularly monitors exposure to key risks, such as those related to
production efficiencies, cash position and competitive position relating to
sales. It has also taken account of the risks facing the business from the
challenging economic environment including inflationary pressures, higher
interest rates and their impact on consumer demand.
It also monitors risks not directly or specifically financial, but capable of
having a major impact on the business's financial performance if there is any
failure. The key risks and the measures taken to manage these risks are noted
below.
Capital structure, cash flow and liquidity
The Group has a strong balance sheet. The business is funded using; retained
earnings, a long term mortgage, term loan and sale and lease back arrangements
to support investments in fixed assets, invoice financing and overdraft
facilities for working capital. Further details are set out in notes 23 and 24
of the full accounts.
At 31 March 2025 the invoicing financing is in a surplus position of £8,000
(2024: £6,100) as the facility is not being utilised. The operations have
generated sufficient cash to improve its liquidity. At 31 March 2025 the Group
has not utilised its overdraft facility (2024: £37,000). Further details are
set out in note 21 of the full accounts in relation to cashflow and liquidity
risk.
Competitive environment
The Group operates in a highly competitive environment in which demand for
products can vary and customers have the opportunity to transfer business to
other suppliers. The Group works to minimise this risk by developing close
relationships with customers offering quality, service and innovation
throughout the business. This risk is also further reduced through the
development of its branded product portfolio and by the diversity of customers
and products offered. All customers are credit insured or pay on proforma
basis before supply.
Quality and Safety
The Group treats quality as its key requirement for all products and strives
to deliver performance products for every price point. Failure to achieve the
required quality and safety standards would have severe consequences for the
Group, from financial penalties to the damage to customer relationships. The
Group has a robust product development process to mitigate risk wherever
possible and to ensure all products are safe and fit for purpose. The Group is
subject to frequent internal and external safety, environmental, ethical and
quality audits covering both accreditations held and a number of specific
operating standards our customers require us to comply with.
Global economic environment
The cost-of-living crisis in the U.K. continues to abate consumer demand. The
Group strategy of pursuing a multi-channel approach to the market and a broad
multi-category product offering continues to serve us well during times when
consumer demand is impacted by a cost-of-living crisis.
The BOE base interest rate has decreased by 0.75% to 4.50% (2024:5.25%) in
response to inflationary pressures easing slightly. Inflation continued to
have a negative impact on consumer demand and the viability of many
businesses. The rate of increase in commodities has eased but core domestic
inflation and the prospect of prolonged higher interest rates remains a cause
for concern. The rate of domestic inflation has reduced as reflected by the
reduction in the BOE base rate. Please see note 21 of the full accounts for
impact of interest sensitivity on our current level of gearing.
The global supply chain continues to be impacted by the war in Ukraine and the
Red Sea issues due to the ongoing conflict in the Middle East. The cost of
importation of goods has increased as well as delivery lead times. These
continue to be closely managed by working collaboratively with our supply
base.
The recent disruption caused by higher U.S. tariffs has had no material impact
on our business operations. This is primarily due to our minimal exposure to
the U.S. market, with no significant customers or suppliers based in the
region. As a result, our supply chains and revenue streams have remained
stable, allowing us to continue operations without the challenges faced by
businesses more directly connected to the U.S. economy.
The Group monitors C.P.I's across all categories of supply. Mitigation
measures included product re-engineering, re-formulating, and increasing
customer selling prices where appropriate.
The Directors have taken account of these potential impacts in their going
concern assessments and have concluded that the direct impact is not
significant to the business, with the indirect impact of price increases being
reviewed on a regular basis. In the face of these challenges the focus of the
business will be on positive cash generation and restoration of profitability.
Credit risk
Our credit risk is that our customers are unable to pay, and we believe this
risk is elevated currently due to the current global economic climate. We
proactively manage the risks faced by our customers by working closely with
them and by increasing debtor management and expanding our credit insurance.
All customers' debtor balances, are within insured credit limits or they pay
on a pro-forma basis. Credit control processes are in place to manage credit
risk including setting appropriate credit limits and the enforcement of credit
terms and ongoing dialogue with all customers. We minimise the risk from
concentration of customers through implementation of these credit processes
and this risk is mitigated through the diversity of our customer base both by
channel and geography. We remain vigilant to the credit risks in light of the
challenging economic environment.
Supplier sourcing and costs
Cost increases driven by inflation, along with global material supply
pressures, remain our key supplier-related risks. While pressure on global
supply chains has eased, uncertainty around future commodity pricing persists.
We continue to work closely with our suppliers and have leveraged improved
sourcing capabilities to expand our supply base. This helps us meet demand
from both existing and new customers while minimising the impact of cost
increases.
We maintain an active dialogue with suppliers to stay informed of commodity
price movements and keep open lines of communication with customers to
anticipate changes in demand, thereby mitigating potential impacts on the
business.
Environmental protection standards and sustainability
The Group's technical department continues to monitor all relevant
environmental regulations that the Group must adhere to, to ensure continued
compliance. We have successfully operated at both manufacturing sites without
a cessation in production due to an environmental incident. The risk of
cessation of production from an environmental breach is considered to be low
but in such an event we would be able to move production to the other site or
to outsource to third party manufacturers in the short term.
The Group's objective is to keep ahead of the move towards more sustainable
products and processes. There is a risk that if we do not take action we will
be left behind and unable to meet our customers' requirements. However, the
Group sees the move towards sustainability as an opportunity for business
growth.
Cyber security
Cyber Security remains a significant threat to all businesses. The Group is
exposed to the risk of sophisticated cyber-attacks aimed at causing direct
financial loss from theft of funds, ransom payments, and costs associated with
system recovery and data restoration. Such attacks also lead to business
interruption, causing lost productivity and revenue. There is also a
heightened risk of theft and encryption of confidential data for financial
gain and reputational damage.
The Group has continued to invest in new software and resources to minimise
the risk of anyone accessing our systems and information. We have enhanced our
ongoing training programme for employees to ensure that they are constantly
aware of their role in protecting the business from all cyber security
threats. The Group has an insurance policy in place to minimise its exposure
to cybercrime.
Consolidated income statement
Year ended 31 March 2025 Year ended 31 March 2024
£000 £000
Revenue 54,066 53,194
Cost of sales (29,913) (30,364)
Gross profit 24,153 22,830
Distribution costs (2,763) (3,488)
Administrative expenses (17,859) (17,804)
Operating profit before exceptional items 3,531 1,538
Exceptional items - Redundancy costs - (17)
Exceptional items - Impairment - (4,449)
Operating profit 3,531 (2,928)
Other income - Research and Development Expenditure Credit 127 -
Finance costs (161) (349)
Profit before tax 3,497 (3,277)
Taxation (1,045) (250)
Profit / (Loss) for the year attributable to the equity shareholders 2,452 (3,527)
Consolidated statement of comprehensive income
Year ended Year ended
31 March 2025 31 March 2024
£000 £000
Profit / (Loss) for the year 2,452 (3,527)
Items that may be subsequently reclassified to profit and loss:
Exchange differences on translating foreign operations 7 13
Other comprehensive income for the year 7 13
Total comprehensive income for the year attributable to the equity 2,459 (3,514)
shareholders
Earnings per share
Year ended 31 March Year ended 31 March
2025 2024
Basic 3.58p (5.15p)
Diluted * 3.29p (5.15p)
* Share options are excluded from the earnings per share calculation for the
year ended 31 March 2024 due to their anti-dilutive effect on the loss after
tax attributable to equity holders. No such exclusion was necessary for the
year ended 31 March 2025.
Adjusted Earnings per share - alternate performance measure
The calculation of basic and diluted earnings per share excluding exceptional
items was presented in the prior year ended 31 March 2024 to provide a more
meaningful comparison of underlying performance. This reconciliation is not
required for the current year ended 31 March 2025 as no such exceptional items
have been adjusted for in the current period.
The prior year figures are presented below for comparative purposes only:
Year ended 31 Mar Year ended 31 Mar
2025 2024
£000 £000
Profit / (Loss) for the period from operations attributable to the equity 2,452 (3,527)
shareholders of the parent Company
Exceptional items - Impairment - 4,449
Exceptional items - Deferred tax charge in relation to the Impairment - 165
Adjusted Earnings excluding exceptional items 2,452 1,087
Adjusted Basic earnings per share - excluding exceptional items 3.58p 1.59p
Adjusted Diluted earnings per share - excluding exceptional items 3.29p 1.42p
Dividends
Year ended Year ended
31 Mar
31 Mar
2025 2024
£000 £000
Final dividend paid - £0.45 (2024: £Nil) per share 307 -
Total dividend paid in year - £0.45 (2024: £Nil) per share 307 -
Proposed - £0.50 pence (2024: 0.45) per share 349 307
Consolidated balance sheet
31 March 31 March
2025 2024
£000 £000
Non-current assets
Goodwill 1,575 1,575
Other intangible assets 6,434 6,374
Property, plant and equipment 4,658 5,219
Right-of-use assets 1,242 1,093
13,909 14,261
Current assets
Inventories 8,872 8,225
Trade and other receivables 11,697 10,518
Cash and cash equivalents 3,659 3,138
24,228 21,881
Total assets 38,137 36,142
Current liabilities
Trade and other payables 8,854 8,265
Corporation tax payable 9 105
Lease liabilities 447 351
Borrowings 190 620
9,500 9,341
Net current assets 14,728 12,540
Non-current liabilities
Deferred tax liability 1,799 1,798
Lease liabilities 705 633
Borrowings 1,910 2,315
4,414 4,746
Total liabilities 13,914 14,087
Net assets 24,223 22,055
Equity
Share capital 700 700
Share premium account 2,024 2,024
Merger reserve 2,476 2,476
Treasury shares (576) (576)
Other reserves (211) (211)
Translation reserve 34 27
Retained earnings 19,776 17,615
Total equity attributable to the equity shareholders of the parent Company 24,223 22,055
Consolidated statement of changes in equity
Share capital Share premium account Merger reserve Treasury shares Other reserves Translation reserve Retained
earnings Total
£000 £000 £000 £000 £000 £000 £000 £000
At 1 April 2023 700 2,022 2,476 (576) (211) 14 21,054 25,479
Comprehensive income for the year
Loss for the year - - - - - - (3,527) (3,527)
Exchange differences on translation of foreign operations - - - - - 13 - 13
Total comprehensive loss for the year - - - - - 13 (3,527) (3,514)
Contributions by and distributions to owners
Exercise of options - 2 - - - - - 2
Share-based payment charge - - - - - - 111 111
Deferred tax through Equity - - - - - - (23) (23)
Total contributions by and distributions to owners - 2 - - - - 88 90
At 31 March 2024 700 2,024 2,476 (576) (211) 27 17,615 22,055
Comprehensive income for the year
Profit for the year - - - - - - 2,452 2,452
Exchange differences on translation of foreign operations - - - - - 7 - 7
Total comprehensive loss for the year - - - - - 7 2,452 2,459
Contributions by and distributions to owners
Share-based payment charge - - - - - - 36 36
Deferred tax through Equity - - - - - - (20) (20)
Dividends paid (307) (307)
Total contributions by and distributions to owners - - - - - - (291)
(291)
At 31 March 2025 700 2,024 2,476 (576) (211) 34 19,776 24,223
Consolidated cash flow statement
Year ended Year ended
31 Mar 31 Mar
2025 2024
£000 £000
Profit from operations including redundancy costs 3,531 1,521
Adjustments for:
Depreciation on property, plant and equipment 956 992
Depreciation on right of use assets 445 368
Amortisation of intangible assets 183 358
(Profit) /Loss on disposal of Right of Use assets (12) 59
Loss on disposal of PPE 34 -
Share based payment charge 36 111
5,173 3,409
(Increase)/Decrease in inventories (647) 2,003
(Increase)/Decrease in trade and other receivables (1,179) 2,215
Decrease/(Increase) in trade and other payables 589 (1,570)
Cash generated from operations 3,936 6,057
Taxation paid (1,030) (30)
Net cash generated from operating activities 2,906 6,027
Investing activities
Purchase of property, plant and equipment (429) (321)
Purchase of intangible assets (243) (287)
Proceeds from sale of assets 10 -
Net cash used in investing activities (662) (608)
Financing activities
Proceeds on issue of shares - 2
Cancellation of leases - (59)
Principal paid on lease liabilities (507) (568)
Repayment of invoice financing facilities - (1,557)
Repayment of amounts borrowed (34) (61)
Repayment on term loan (611) (1,329)
Interest paid on term loan (18) (123)
Repayment on mortgage loan facility (187) (180)
Interest paid on mortgage loan facility (66) (72)
Dividends paid to owners of the parent (307) -
Net cash used in financing activities (1,730) (3,947)
Net increase in cash and cash equivalents 514 1,472
Cash and cash equivalents at start of year 3,138 1,653
Effect of foreign exchange rate changes 7 13
Cash and cash equivalents at end of year 3,659 3,138
Notes to financial statements:
1. Significant accounting policies
Basis of accounting
The Group financial statements have been prepared in accordance with
UK-adopted international accounting standard in conformity with the
requirements of the Companies Act 2006.
The IFRSs applied in the Group financial statements are subject to ongoing
amendment by the IASB and therefore subject to possible change in the future.
Further standards and interpretations may be issued that will be applicable
for financial years beginning on or after 1 April 2025 or later accounting
periods but may be adopted early.
The preparation of financial statements in accordance with IFRS requires the
use of certain accounting estimates. It also requires management to exercise
its judgement in the process of applying the Group's accounting policies.
The primary statements within the financial information contained in this
document have been presented in accordance with IAS1 Presentation of Financial
Statements.
The financial statements have been prepared on the historical cost basis as
modified for the fair value of business combinations. Historical cost is
generally based on the fair value of the consideration given in exchange for
goods and services. The principal accounting policies adopted are set out
below.
The Company has taken advantage of the exemption allowed under section 408 of
the Companies Act 2006 and has not presented its own Statement of
Comprehensive Income in these financial statements.
Adoption of new and revised accounting standards
None of the standards adopted during the year had a material impact on the
Group's financial statements for the year ended 31 March 2025.
There are a number of standards, amendments to standards, and interpretations
which have been issued by the IASB that are effective in future accounting
periods that the Group has decided not to adopt early. The Group does not
expect any of the standards issued by the IASB, but not yet effective, to have
a material impact on the Group.
2. Financial instruments and treasury risk management
Market risk
Market risk is the risk that arises from movements in inventory prices,
interest rates, exchange rates, and commodity prices.
Market risk for the 31 March 2025 year end is reflected within the interest
rate and foreign currency risk which are discussed further below.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer fails to
meet its contractual obligations.
Trading exposures are monitored by the operational Companies against agreed
policy levels. Credit insurance with a world leading insurer is employed
across the majority of our trade debtors. At 31 March 2025 all trade debtors
(2024: all) are covered by credit insurance with a cover of 90% of the debtor
balances. Non-trading financial exposures are incurred only with the Group's
bankers or other institutions with prior approval of the Board of Directors.
The majority of trade receivables are with retail customers. The maximum
exposure to credit risk is represented by the carrying amount of those
financial assets in the balance sheet.
Impairment provisions on trade receivables have been disclosed in note 19 of
the full accounts.
The credit risk on liquid funds such as cash and cash equivalents is limited
because the counterparties are banks
with high credit-ratings assigned by international credit-rating agencies.
All trade debtors are credit insured, therefore the maximum write off balance
on any customer default would be 10% of the invoiced value (net of VAT).
Interest rate risk
The Group's interest rate exposure arises mainly from its interest-bearing
borrowings.
The Group finances its operations through a mixture of debt associated with
working capital facilities and equity. The Group is exposed to changes in
interest rates on its floating rate working capital facilities. The
variability and scale of these facilities is such that the Group does not
consider it cost effective to hedge against this risk.
The Group also secured a fixed rate mortgage for a 15 year term, 9.5 years
remaining, secured on the property with an interest rate of 3.04% fixed for
the first 10 years, 4.5 years remaining, of the loan, therefore reducing the
interest rate risk. The interest charge on the mortgage for the year ended 31
March 2025 was £66,000 (2024: £72,000).
On 3 September 2021, the Group took out a term loan of £3,000,000 to fund
part of the purchase of the acquisitions in the prior year. The term loan is
for a 4 year term secured on the assets of the Group with an interest rate of
2.70% above the Bank of England base rate. The term loan was fully repaid
during the financial year. The interest charge on the term loan for the period
to 31 March 2025 was £17,000 (2024: £123,000). A 1% increase in the interest
rate would have resulted in an additional charge of £5,900 (2024: £41,000).
As a result of repaying the loan in full, there was no outstanding balance on
the loan at the year end. The repayment of the loan has reduced the company's
exposure to interest rate risk.
Interest rate sensitivity
The interest rate sensitivity is based upon the Group's borrowings over the
year assuming a 1% increase or decrease which is used when reporting interest
rate risk internally to key management personnel.
A 1% increase in bank base rates would reduce Group pre-tax profits by
£12,000 (2024: £36,000). A 1% decrease would have the opposite effect. The
Group's sensitivity to interest rates has changed during the current year due
to the current economic climate, which has had the impact of decreasing BOE
base rates.
Foreign currency risks
The Group operates in a number of markets across the world and is exposed to
foreign currency transaction and translation risks arising on the purchase and
sales of goods in particular with respect to the US dollar and Euro.
Transaction risk arises on income and expenditure in currencies other than the
functional currency of each Group Company. The magnitude of this
risk is relatively low as the majority of the Group's income and expenditure
are denominated in the functional currency. Approximately 0.3% (2024: 1%) of
the Group's income is denominated in US dollars and 1% (2024: 4%) in Euros.
Approximately 3% (2024: 7%) of the Group's expenditure is denominated in US
dollars and 4% (2024: 8%) in Euros.
Foreign currency sensitivity
A 5% strengthening of sterling would result in a £142,000 (2024: £258,000)
increase in profits and equity. A 5% weakening in sterling would result in a
£157,000 (2024: £285,000) reduction in profits and equity.
When appropriate the Group utilises currency derivatives to hedge against
significant future transactions and cash flow. There were no outstanding
contracts as at 31 March 2025 or 31 March 2024.
Cash flow and liquidity risk
Liquidity risk arises from the Group's management of working capital. It is
the risk that the Group will encounter difficulty in meeting its financial
obligations as they fall due.
The Group manages its working capital requirements through overdrafts and
invoice finance facilities. These facilities were renewed in March 2025 for a
further 12 months. The maturity profile of the committed bank facilities is
reviewed regularly and such facilities are extended or replaced well in
advance of their expiry. The Group has complied with the terms of these
facilities. At 31 March 2025 the Group had available £6,193,000 (2024:
£5,616,000) of undrawn committed borrowing facilities in respect of which all
conditions precedent had been met. The Group has a fixed rate mortgage for a
15 year term secured on the property with an interest rate of 3.04% fixed for
the next 4.5 years of the loan. The Company also took out a term loan of
£3,000,000 to fund part of the purchase of the acquisitions in the prior
year. The term loan is for a 4 year term secured on the assets of the Group
with an interest rate of 2.70% above the Bank of England base rate. The term
loan was fully repaid during the financial year. As a result, there was no
outstanding balance on the loan at the year end. The repayment of the loan has
reduced the company's exposure to cash flow and liquidity risk by eliminating
the need for future principal and interest payments, thereby improving the
company's financial flexibility and overall liquidity position.
3. Financial assets
Financial assets are included in the Statement of financial position within
the following headings. These are valued at amortised cost and are detailed
below.
Group Company
2025 2024 2025 2024
£000 £000 £000 £000
Trade and other receivables 11,100 10,172 3,988 4,351
Cash and cash equivalents 3,659 3,138 42 20
Total 14,759 13,310 4,030 4,371
4. Financial liabilities
Financial liabilities are included in the Statement of financial position
within the following headings. These are valued at amortised cost and are
detailed below.
At 31 March 2025
Group
Less than 6 months Between 6 months and 1 year Between 1 and 5 years Over 5 years Total
£000 £000 £000 £000 £'000
Trade payables 5,585 - - - 5,585
Accruals 2,354 - - - 2,354
Obligations under leases 220 227 702 3 1,152
Overdraft and invoice financing - - - - -
Loan 94 96 830 1,080 2,100
Total 8,253 323 1,532 1,083 11,191
At 31 March 2024
Group
Less than 6 months Between 6 months and 1 year Between 1 and 5 years Over 5 years Total
£000 £000 £000 £000 £'000
Trade payables 4,976 - - - 4,976
Accruals 2,235 - - - 2,235
Obligations under leases 182 169 633 - 984
Overdraft and invoice financing 37 - - - 37
Loan 286 297 1,017 1,298 2,898
Total 7,716 466 1,650 1,298 11,130
5. Earnings per share
The calculation of the basic and diluted earnings per share is based on the
following data:
Year ended Year ended
31-Mar 31-Mar
2025 2024
£000 £000
Earnings
Profit / (Loss) attributable to the equity holders of the parent Company 2,452 (3,527)
Year ended Year ended
31-Mar 31-Mar
2025 2024
Number Number
Number of shares
Weighted average number of ordinary shares for the purposes of basic earnings 68,435,383 68,433,858
per share
Effect of dilutive potential ordinary shares relating to share options * 6,205,687 8,310,548
Weighted average number of ordinary shares for the purposes of Adjusted 74,641,070 76,744,406
Earnings per share (2024: for the purpose of Diluted Earnings per share)
Basic earnings per share - including exceptional items 3.58p (5.15p)
Diluted earnings per share - including exceptional items * 3.29p (5.15p)
* Share options were excluded from the earnings per share calculation for the
year ended 31 March 2024 due to their anti-dilutive effect on the loss after
tax attributable to equity holders. No such exclusion was necessary for the
year ended 31 March 2025.
Adjusted Earnings per share - alternate performance measure
The calculation of basic and diluted earnings per share excluding exceptional
items was presented in the prior year ended 31 March 2024 to provide a more
meaningful comparison of underlying performance. This reconciliation is not
required for the current year ended 31 March 2025 as no such exceptional items
have been adjusted for in the current period.
The prior year figures are presented below for comparative purposes only:
Year ended 31-Mar Year ended 31-Mar
2025 2024
£000 £000
(Loss) / Profit for the period from operations attributable to the equity 2,452 (3,527)
shareholders of the parent Company
Exceptional items - Impairment - 4,449
Exceptional items - Deferred tax charge in relation to the Impairment - 165
Adjusted Earnings excluding exceptional items 2,452 1,087
Adjusted Basic earnings per share - excluding exceptional items 3.58p 1.59p
Adjusted Diluted earnings per share - excluding exceptional items 3.29p 1.42p
6. Share capital
Ordinary shares of 1p each
£000 Number
At 1 April 2023 700 70,029,583
Issued in the year 0 5,800
At 31 March 2024 700 70,035,383
Issued in the year 0 -
At 31 March 2025 700 70,035,383
The Company has one class of ordinary shares which carry no right to fixed
income. All of the shares are issued and fully paid. The total proceeds from
the issue of shares from the exercise of share options in the year was £Nil
(2024: £2,000).
7. Notes to cash flow statement
Analysis of changes in net debt
Overdraft Invoice Financing Mortgage Loan Total
£000 £000 £000 £000 £000
At 1 April 2024 37 - 2,287 611 2,935
Cash outflow - principal (34) - (187) (611) (832)
Cash outflow - interest - - (66) (18) (84)
Interest accruing (3) - 66 18 81
At 31 March 2025 - - 2,100 - 2,100
Overdraft Invoice Financing Mortgage Loan Total
£000 £000 £000 £000 £000
At 1 April 2023 26 1,557 2,467 1,940 5,990
Cash outflow - principal (61) (1,557) (180) (1,329) (3,127)
Cash outflow - interest - - (72) (123) (195)
Interest accruing 72 - 72 123 267
At 31 March 2024 37 - 2,287 611 2,935
The mortgage balance pertains specifically to the Company.
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