REG - Fulcrum Utility Srvc - Audited Preliminary Results <Origin Href="QuoteRef">FCRM.L</Origin> - Part 2

Fulcrum Utility ServicesAnnouncement

06/06/2017 07:06

- Part 2: For the preceding part double click  ID:nRSF2032Ha 

                                                    
 Effect of change in rate of corporation tax   -                         37                                            -                         61                             
 Revaluation of property, plant and equipment  -                         (46)                                          -                         (125)                          
 At 31 March 2017                              1,921                     (685)                                         3,210                     (676)                          
 
 
6.    Property, plant and equipment 
 
                                     Pipelines£'000  Fixtures and fittings£'000  Computer equipment£'000  Total£'000  
 Cost                                                                                                                 
 At 1 April 2015                     7,901           318                         750                      8,969       
 Additions                           1,886           50                          6                        1,942       
 Disposals                           -               -                           (2)                      (2)         
 At 31 March 2016                    9,787           368                         754                      10,909      
 Additions                           2,518           118                         263                      2,899       
 Disposals                           -               -                           -                        -           
 At 31 March 2017                    12,305          486                         1,017                    13,808      
 Accumulated depreciation                                                                                             
 At 1 April 2015                     (622)           (289)                       (550)                    (1,461)     
 Depreciation charge for the period  (224)           (43)                        (180)                    (447)       
 Revaluation                         478             -                           -                        478         
 Disposals                           -               -                           1                        1           
 At 31 March 2016                    (368)           (332)                       (729)                    (1,429)     
 Depreciation charge for the period  (280)           (43)                        (39)                     (362)       
 Revaluation                         280             -                           -                        280         
 Disposals                           -               -                           -                        -           
 At 31 March 2017                    (368)           (375)                       (768)                    (1,511)     
 Net book value                                                                                                       
 At 31 March 2017                    11,937          111                         249                      12,297      
 At 31 March 2016                    9,419           36                          25                       9,480       
 At 1 April 2015                     7,279           29                          200                      7,508       
 
 
The last external valuation of the pipeline assets was performed during the
financial year ended 31 March 2014. The valuation performed for the year ended
31 March 2017 was completed internally and based on the same principles as the
external valuation. When performing the valuation, management has used
judgement in assessing the key assumptions used in the valuation model
including asset life and occupancy rates. The valuation technique used is
classified as a Level 3 fair value (based on unobservable inputs) under IFRS
13 and the pipeline assets are the only financial assets that are held at fair
value in the financial statements. Within the £2.5 million additions in the
year is £0.3 million which has been included within the revaluation reserve. 
 
7.    Intangible assets 
 
                                          Goodwill£'000  Software£'000  Total£'000  
 Cost                                                                               
 At 1 April 2015                          2,225          2,294          4,519       
 Additions                                -              59             59          
 At 31 March 2016                         2,225          2,353          4,578       
 Additions                                -              248            248         
 At 31 March 2017                         2,225          2,601          4,826       
 Accumulated amortisation and impairment                                            
 At 1 April 2015                          -              (1,682)        (1,682)     
 Amortisation for the period              -              (299)          (299)       
 At 31 March 2016                         -              (1,981)        (1,981)     
 Amortisation for the period              -              (278)          (278)       
 At 31 March 2017                         -              (2,259)        (2,259)     
 Net book value                                                                     
 At 31 March 2017                         2,225          342            2,567       
 At 31 March 2016                         2,225          372            2,597       
 At 1 April 2015                          2,225          612            2,837       
 
 
Goodwill brought forward at the start of the year relates to the acquisition
of Fulcrum Group Holdings Limited on 8 July 2010. The carrying amount of the
intangible asset is allocated across cash-generating units (CGUs). All of the
goodwill held by the Group is considered to fall in the CGU of infrastructure
services. The recoverable amount of goodwill has been calculated with
reference to its value in use. 
 
The Group prepares cash flow forecasts derived from the most recent three year
financial budgets approved by management and extrapolated for three years
using a conservative estimated growth rate of 1.5%. The key assumptions of
this calculation are shown below: 
 
                                                          Year ended31 March2017  Year ended31 March2016  
 Period on which management approved forecasts are based  3 years                 3 years                 
 Growth rate applied beyond approved forecast period      1.5%                    1.5%                    
 Discount rate                                            6.5%                    7.1%                    
 
 
No reasonable possible change in the assumptions noted above would lead to an
impairment charge being required. 
 
8.    Trade and other payables 
 
                               31 March2017£'000  31 March2016£'000  
 Trade payables                2,779              2,068              
 Accruals and deferred income  22,430             20,568             
 Other payables                1,782              2,429              
                               26,991             25,065             
 
 
Of the £22.4 million accruals and deferred income, £14.5 million (2016: £13.7
million) relates to deferred income. Deferred income represents contracted
sales for which services to customers will be provided in future periods. 
 
9.    Share based payments 
 
In the year, 10,854,074 ordinary shares were issues with a nominal value of
£10,854 to employees exercising shares options for cash consideration of
£832,000. In addition, the Group recognised total expense before tax of
£213,000 (2016: £314,000) in relation to equity settled share based payments
transactions in the statement of comprehensive income. These options have been
credited against retained earnings reserve. No cash-settled share based
payment awards have been granted to employees. 
 
10.  Reconciliation to net funds 
 
                            31 March 2017  31 March 2016  
                            £'000          £'000          
 Cash and cash equivalents  12,561         8,323          
 Net funds                  12,561         8,323          
 
 
11.  Share premium 
 
                   31 March 2017  31 March 2016  
                   £'000          £'000          
 At 1 April 2016   15,233         16,182         
 Dividends paid    (1,964)        (1,087)        
 Shares issued     832            138            
 At 31 March 2017  14,101         15,233         
 
 
12.  Revaluation reserve 
 
                                        31 March 2017  31 March 2016  
                                        £'000          £'000          
 At 1 April 2016                        3,079          2,449          
 Revaluation in the period              280            708            
 Revaluation reserve transfer           (7)            (14)           
 Recognition of deferred tax liability  (9)            (64)           
 At 31 March 2017                       3,343          3,079          
 
 
13.  Retained earnings 
 
                                                  31 March 2017  31 March 2016  
                                                  £'000          £'000          
 At 1 April 2016                                  (12,631)       (17,693)       
 Retained profit in the period                    5,246          4,734          
 Revaluation reserve transfer                     7              14             
 Equity-settled share based payment transactions  213            314            
 At 31 March 2017                                 (7,165)        (12,631)       
 
 
14.  Related parties 
 
The Group has a related party relationship with its subsidiaries and with its
Directors. Details of the remuneration, share options and pension entitlement
of the Directors are included in the Annual Report. 
 
This information is provided by RNS
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