REG - Goodwin PLC - Half-year Report

GoodwinAnnouncement

19/12/2019 07:05

RNS Number : 3973X
Goodwin PLC
19 December 2019
 


 
 
GOODWIN PLC
CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
for the half year ended 31st October 2019
 
CHAIRMAN'S STATEMENT
 
The pre-tax profit for the Group for the six month period ending 31st October 2019 was £7.4 million some 5.1% down (2018 £7.8 million). This deterioration was despite the turnover for the period being marginally in front with a 3.8% increase. This is a feature of the disruption caused by the commotions in our parliamentary system over the past six months where the uncertainty has temporarily stalled projects.
With further clarity over Brexit, we will be looking to start capitalising from the tremendous success our Group companies have had in winning large amounts of business from new market areas.
We have every reason to believe that the new financial year will allow our Group companies to start increasing profits.   We also expect to have further successes in winning significant new business due to the dedication and hard work of all who work within them.




T. J. W. Goodwin


 




Chairman


19th December 2019




 
Management Report
Financial Highlights




 


Unaudited

Half Year to


Unaudited

Half Year to


Audited

Year Ended




 


31st October


31st October


30th April




 


2019


2018


2019




 


£'m


£'m


£'m




Consolidated Results


 


 


 




Revenue


70.1


67.5


127.0




Operating profit


7.8


7.8


16.4




Profit before tax


7.4


7.8


16.4




Profit after tax


5.6


5.7


12.4




Capital Expenditure


2.9


5.7


10.7




Earnings per share - basic


72.92p


74.90p


159.79p




Earnings per share - diluted


69.77p


73.44p


149.65p




 


 


 


 




 
IFRS 16
The Group adopted IFRS 16 from 1 May 2019, using the modified retrospective approach to transition, such that prior periods have not been restated.  The impact of the change in accounting policy is outlined in note 5.
Turnover
Sales revenue of £70,090,000 for the half year represents a 3.8 % increase from the £67,548,000 achieved during the same period last year.
Profit Before Tax
Profit before tax for the six months of £7,406,000 is down 5.1% from the £7,804,000 achieved for the same six month period last year.
Key performance indicators
The key performance indicators for the business are listed below; the prior period KPIs have not been restated to reflect IFRS 16.




 


Unaudited

Half Year to


Unaudited

Half Year to


Audited

Year Ended




 


31st October


31st October


30th April




 


2019


2018


2019




 


 


 


 




Gross profit as a % of turnover


27.8


29.5


32.0




Other income (in £ millions)


0.7


-


-




Profit before tax (in £ millions)


7.4


7.8


16.4




 


 


 


 




Gearing % (excluding deferred consideration and right-of-use lease liabilities)


25.7


12.1


20.0




 


 


 


 




Depreciation (in £ millions)


3.2


2.8


5.8




Depreciation of right-of-use assets (in £ millions)


0.4


-


-




Amortisation (in £ millions)


0.5


0.5


1.3




Equity-settled share-based provision (in £ millions)


-


0.5


1.2




Total non cash charges (in £ millions)


4.1


3.8


8.3




 
Alternative performance measures mentioned above are defined in note 36 on page 82 of the Group Annual accounts to 30th April 2019.
2020/21 Outlook
The Group is likely to show a similar profitability in the next six months as it achieved in the first six months of the year, with an improving cash flow by the 30th April 2020.
In the Mechanical Engineering Division, although the petrochemical market has not yet recovered, we continue to have a positive outlook based on the fact that the demand for energy is set to increase.   This is propelled to a large extent by increases in wealth in the developing economies which obtain a growing share of their power from the US LNG market, in which Noreva and Goodwin International are well established.
Easat Radar Systems has been successful in winning an order to supply two turnkey surveillance systems for an Asian air force.  The order is the first overseas system order for the company opening the door to a larger market within which, with its competitive offering as a result of the acquisition of NRPL, the company is expected to prosper. 
Within the Refractory Engineering Division, there has been an unforeseen decrease in demand for the consumer orientated jewellery products for which we globally supply the casting powder. We believe this is due mainly to the uncertainty around the ongoing USA and China trade war and the rise in gold price since May that peaked in August and has declined ever since.   However, at the time of writing, it appears the market is beginning to improve.
Sales of the AVD fire extinguishers and extinguishing agent are starting to grow with a constant monthly sales stream. First adopters have primarily been companies that manufacture products incorporating lithium ion batteries, such as e-scooters, vehicles and green energy storage systems. We are in technical and supply discussion with several large battery manufacturers both in the UK and overseas which may bode well over time.
Risks and Uncertainties
The Group, mainly through its centralised management structure, makes best endeavours to have in place internal control procedures to identify and manage the key risks and uncertainties affecting the Group. We would refer you to pages 10 and 11 of the Group Annual Accounts to 30th April 2019 which describe the principal risks and uncertainties, and to note 27 (starting on page 72) which describes in detail the key financial risks and uncertainties affecting the business such as credit risk and foreign exchange risk.
Judging the future relationship of the major currency pairs of the US Dollar, Sterling and the Euro continues to be a challenge.
Report on Expected Developments
This report describes the expected developments of the Group during the year ended 30th April 2020. The report may contain forward-looking statements and information based on current expectations, and assumptions and forecasts made by the Group. These expectations and assumptions are subject to various known and unknown risks, uncertainties and other factors, which could lead to substantial differences between the actual future results, financial performance and the estimates and historical results given in this report. Many of these factors are outside the Group's control. The Group accepts no liability to publicly revise or update these forward-looking statements or adjust them to future events or developments, whether as a result of new information, future events or otherwise, except to the extent legally required.
Going concern
The Group continues to trade profitably and with the current order book level we are confident that this will continue and improve, especially as we move in to the next financial year. As in previous periods, the levels of depreciation and amortisation (both non cash items) remain significant thus increasing the cash generating capability of the Group. As at 31st October 2019, the Group net debt stood at £27.2 million as set out in note 11 to these accounts. Whilst the net debt levels are higher than those recorded as at April 2019 and October 2018 the gearing level at 25.7% is still modest and our banking headroom (facilities versus utilisation) is significant. Furthermore, within the second half of this financial year we would expect to significantly reduce our investment in working capital.  Given the foregoing, the Directors do not see an issue with the continued ability of the Group to meet its financial commitments and so have drawn up these accounts on a going concern basis.
Responsibility statement of the Directors in respect of the half-yearly financial report
The Directors confirm to the best of their knowledge that 1) this condensed set of financial statements has been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union and that 2) the Interim Management Report and condensed financial statements include a fair review of the information required by Disclosure and Transparency Rules 4.2.7R (being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year) and 4.2.8R (being related party transactions that have taken place in the first six months of the financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last Annual Report that could do so).
 




T. J. W. Goodwin


 




Chairman


19th December 2019




 
 
 
 
Condensed Consolidated Statement of Profit or Loss
for the half year to 31st October 2019
 




 


Unaudited


Unaudited


Audited




 


Half Year to


Half Year to


Year Ended




 


31st October


31st October


30th April




 


2019


2018


2019




 


£'000


£'000


£'000




Continuing operations


 


 


 




Revenue


70,090


67,548


127,046




Cost of sales


(50,610)


(47,608)


(86,414)




 


                 


                 


                 




Gross profit


19,480


19,940


40,632




Other income


689


-


-




Distribution expenses


(1,629)


(1,564)


(3,016)




Administrative expenses


(10,715)


(10,539)


(21,205)




 


                 


                 


                 




Operating profit


7,825


7,837


16,411




Financial expenses


(449)


(303)


(234)




Share of profit of associate companies


30


270


233




 


                 


                 


                 




Profit before taxation


7,406


7,804


16,410




Tax on profit


(1,812)


(2,076)


(3,963)




 


                 


                 


                 




Profit after taxation


5,594


5,728


12,447




 


                 


                 


                 




Attributable to:


 


 


 




Equity holders of the parent


5,260


5,393


11,505




Non-controlling interests


334


335


942




 


                 


                 


                 




Profit for the period


5,594


5,728


12,447




 


                 


                 


                 




Basic earnings per ordinary share (Note 10)


72.92p


74.90p


159.79p




 


                 


                 


                 




Diluted earnings per ordinary share (Note 10)


69.77p


73.44p


149.65p




 


                 


                 


                 




 
Condensed Consolidated Statement of Comprehensive Income
for the half year to 31st October 2019
 




 


Unaudited


Unaudited


Audited




 


Half Year to


Half Year to


Year Ended




 


31st October


31st October


30th April




 


2019


2018


2019




 


£'000


£'000


£'000




 


 


 


 




Profit for the period


5,594


5,728


12,447




 


 


 


 




Other comprehensive income / (expense)


 


 


 




 


 


 


 




Items that are or may be reclassified subsequently to the income statement


 


 


 




Foreign exchange translation differences


(162)


(259)


(383)




Goodwill arising from purchase of non-controlling interest in subsidiaries


(63)


-


(772)




Effective portion of changes in fair value of cash flow hedges


1,928


(3,023)


(644)




Change in fair value of cash flow hedges transferred to profit or loss


379


-


180




Cost of hedging


(239)


595


(440)




Tax on items that are or may be reclassified subsequently to profit or loss


(347)


413


154




 


                 


                 


                 




Other comprehensive income / (expense) for the period, net of income tax


1,496


(2,274)


(1,905)




 


                 


                 


                 




Total comprehensive income for the period


7,090


3,454


10,542




 


                 


                 


                 




Attributable to:


 


 


 




Equity holders of the parent


6,761


3,183


9,528




Non-controlling interests


329


271


1,014




 


                 


                 


                 




 


7,090


3,454


10,542




 


                 


                 


                 




 
Condensed Consolidated Statement of Changes in Equity
for the half year to 31st October 2019
 




 


Share capital


Translat-ion reserve


Share-based payments reserve


Cash flow hedge reserve


Cost of hedging reserve


Retained earnings


Total attribut-able to equity holders of the parent


Non-controll-ing interests


Total equity




 


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000




Half year to 31st October 2019
(Unaudited)


 


 


 


 


 


 


 


 


 




Balance at 1st May 2019


720


1,044


4,991


(573)


(426)


99,409


105,165


4,126


109,291




Total comprehensive income:


 


 


 


 


 


 


 


 


 




Profit


-


-


-


-


-


5,260


5,260


334


5,594




Other comprehensive income:


 


 


 


 


 


 


 


 


 




Goodwill arising from purchase of NCI interest in subsidiary


-


-


-


-


-


(63)


(63)


-


(63)




Foreign exchange translation differences


-


(198)


-


-


-


-


(198)


36


(162)




Net movements on cash flow hedges


-


-


-


1,937


(175)


-


1,762


(41)


1,721




Total comprehensive income for the period


-


(198)


-


1,937


(175)


5,197


6,761


329


7,090




Issue of shares


16


-


-


-


-


-


16


-


16




Dividends paid


-


-


-


-


-


(6,927)


(6,927)


-


(6,927)




Acquisition of NCI without a change of control


-


-


-


-


-


-


-


(11)


(11)




Other transactions


-


358


-


-


-


(358)


-


-


-




 


                 


                 


                 


                 


                 


                 


                 


                 


                 




Balance at 31st October 2019


736


1,204


4,991


1,364


(601)


97,321


105,015


4,444


109,459




 


                 


                 


                 


                 


                 


                 


                 


                 


                 




 
Condensed Consolidated Statement of Changes in Equity
for the half year to 31st October 2019




 


Share capital


Translat-ion reserve


Share-based payments reserve


Cash flow hedge reserve


Cost of hedging reserve


Retained earnings


Total attribut-able to equity holders of the parent


Non-controll-ing interests


Total equity




 


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000




Half year to 31st October 2018
(Unaudited)


 


 


 


 


 


 


 


 


 




Balance at 1st May 2018


720


1,879


1,625


(224)


-


95,568


99,568


5,259


104,827




Adjustment on initial application of IFRS 9 (net of tax)


-


-


-


52


(52)


-


-


-


-




Adjustment on initial application of IFRS 15 (net of tax) - original


-


-


-


-


-


285


285


(56)


229




Adjustment on initial application of IFRS 15 (net of tax) - revision


-


-


-


-


-


(969)


(969)


(294)


(1,263)




 


                 


                 


                 


                 


                 


                 


                 


                 


                 




Adjusted balance at 1st May 2018


720


1,879


1,625


(172)


(52)


94,884


98,884


4,909


103,793




Total comprehensive income:


 


 


 


 


 


 


 


 


 




Profit


-


-


-


-


-


5,393


5,393


335


5,728




Other comprehensive income:


 


 


 


 


 


 


 


 


 




Foreign exchange translation differences


-


(211)


-


-


-


-


(211)


(48)


(259)




Net movements on cash flow hedges


-


-


-


(2,594)


595


-


(1,999)


(16)


(2,015)




Total comprehensive income for the period


-


(211)


-


(2,594)


595


5,393


3,183


271


3,454




Equity-settled share-based payment transactions


-


-


523


-


-


-


523


-


523




Dividends paid


-


-


-


-


-


(6,074)


(6,074)


(451)


(6,525)




 


                 


                 


                 


                 


                 


                 


                 


                 


                 




Balance at 31st October 2018


720


1,668


2,148


(2,766)


543


94,203


96,516


4,729


101,245




 


                 


                 


                 


                 


                 


                 


                 


                 


                 




 
 
Condensed Consolidated Statement of Changes in Equity
for the half year to 31st October 2019
 




 


Share capital


Translat-ion reserve


Share-based payments reserve


Cash flow hedge reserve


Cost of hedging reserve


Retained earnings


Total attribut-able to equity holders of the parent


Non-controll-ing interests


Total equity


 




 


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000


 




 
Year ended 30th April 2019


 


 


 


 


 


 


 


 


 


 




Balance at 1st May 2018


720


1,879


1,625


(224)


-


95,568


99,568


5,259


104,827


 




Adjustment on initial application of IFRS 9 (net of tax)


-


-


-


52


(52)


-


-


-


-




Adjustment on initial application of IFRS 15 (net of tax)


-


-


-


-


-


(684)


(684)


(350)


(1,034)




 


                 


                 


                 


                 


                 


                 


                 


                 


                 




Adjusted balance at 1st May 2018


720


1,879


1,625


(172)


(52)


94,884


98,884


4,909


103,793




Total comprehensive income:


 


 


 


 


 


 


 


 


 


 




Profit


-


-


-


-


-


11,505


11,505


942


12,447


 




Other comprehensive income:


 


 


 


 


 


 


 


 


 


 




Foreign exchange translation differences


-


(430)


-


-


-


-


(430)


47


(383)


 




Goodwill arising from purchase of NCI interest in subsidiaries


-


(180)


-


-


-


(592)


(772)


-


(772)


 




Net movements on cash flow hedges


-


-


-


(401)


(374)


-


(775)


25


(750)


 




 


                 


                 


                 


                 


                 


                 


                 


                 


                 




Total comprehensive income for the period


-


(610)


-


(401)


(374)


10,913


9,528


1,014


10,542


 




Equity-settled share-based payment transactions


-


-


1,220


-


-


-


1,220


-


1,220


 




Tax on equity-settled share-based payment transactions


-


-


2,146


-


-


-


2,146


-


2,146


 




Dividends paid


-


-


-


-


-


(6,126)


(6,126)


(451)


(6,577)


 




Acquisition of NCI without a change of control


-


-


-


-


-


-


-


(1,750)


(1,750)


 




Disposal of equity investments


-


(225)


-


-


-


-


(225)


-


(225)


 




Acquisition of subsidiary with NCI


-


-


-


-


-


-


-


142


142


 




Capital contribution


-


-


-


-


-


(262)


(262)


262


-


 




 


                 


                 


                 


                 


                 


                 


                 


                 


                 




Balance at 30th April 2019


720


1,044


4,991


(573)


(426)


99,409


105,165


4,126


109,291


 




 


                 


                 


                 


                 


                 


                 


                 


                 


                 



 
 
 
 
 
 
 
 
 
 
 
 



 
Condensed Consolidated Balance Sheet
as at 31st October 2019




 


 


Unaudited


Unaudited


Audited




 


 


as at


as at


as at     




 


 


31st October


31st October


 30th April




 


 


2019


2018


2019




 


 


£'000


£'000


£'000




Non-current assets


 


 


 


 




Property, plant and equipment


 


63,481


71,713


74,106




Right-of-use assets


 


11,798


-


-




Investment in associates


 


817


2,290


739




Intangible assets


 


22,483


21,308


22,354




Other financial assets at amortised cost


 


361


564


505




 


 


                 


                 


                 




 


 


98,940


95,875


97,704




 


 


                 


                 


                 




Current assets


 


 


 


 




Inventories


 


56,913


33,916


50,524




Contract assets


 


9,846


5,264


3,698




Trade and other financial assets


 


24,620


22,284


24,964




Other receivables


 


3,694


1,834


2,715




Deferred tax asset


 


84


-


-




Derivative financial assets


 


2,247


24


195




Cash and cash equivalents


 


9,416


7,577


9,640




 


 


                 


                 


                 




 


 


106,820


70,899


91,736




 


 


                 


                 


                 




Total assets


 


205,760


166,774


189,440




 


 


                 


                 


                 




Current liabilities


 


 


 


 




Bank overdrafts


 


3,340


3,654


9,147




Interest-bearing loans


 


4,080


5,088


112




Lease liabilities


 


2,131


902


939




Contract liabilities*


 


27,068


10,505


18,002




Trade payables and other financial liabilities


 


18,174


20,078


20,570




Other payables


 


6,471


4,461


4,771




Deferred consideration


 


204


500


204




Derivative financial liabilities


 


1,552


4,240


1,693




Liabilities for current tax


 


1,393


2,388


2,356




Warranty provision


 


235


99


261




 


 


                 


                 


                 




 


 


64,648


51,915


58,055




 


 


                 


                 


                 




Non-current liabilities


 


 


 


 




Interest-bearing loans


 


22,310


8,000


19,322




Lease liabilities


 


6,342


1,637


1,164




Warranty provision


 


219


439


232




Deferred tax liabilities


 


2,782


3,538


1,376




 


 


                 


                 


                 




 


 


31,653


13,614


22,094




 


 


                 


                 


                 




Total liabilities


 


96,301


65,529


80,149




 


 


                 


                 


                 




Net assets


 


109,459


101,245


109,291




 


 


                 


                 


                 




 


 


 


 


 




Equity attributable to equity holders of the parent


 


 


 




Share capital


 


736


720


720




Translation reserve


 


1,204


1,668


1,044




Share-based payments reserve


 


4,991


2,148


4,991




Cash flow hedge reserve


 


1,364


(2,766)


(573)




Cost of hedging reserve


 


(601)


543


(426)




Retained earnings


 


97,321


94,203


99,409




 


 


                 


                 


                 




Total equity attributable to equity holders of the parent


105,015


96,516


105,165




Non-controlling interests


 


4,444


4,729


4,126




 


 


                 


                 


                 




Total equity


 


109,459


101,245


109,291




*Contract liabilities include advance payments from customers of £26,820,000, with the balance of £248,000 being costs accrued for contracts.
 
Condensed Consolidated Statement of Cash Flows
for the half year ended 31st October 2019




 


Unaudited


Unaudited


Audited




 


Half Year  to 31st October 2019


Half Year       to 31st October    2018


Year ended 30th        April       2019




 


£'000


£'000


£'000




Cash flow from operating activities


 


 


 




Profit from continuing operations after tax


5,594


5,728


12,447




Adjustments for:


 


 


 




Depreciation


3,180


2,764


5,819




Depreciation of right-of-use assets


389


-


-




Amortisation of intangible assets


484


549


1,312




Financial expenses


449


303


234




Foreign exchange losses / (gains)


143


(127)


66




Loss / (profit) on sale of property, plant and equipment


2


(11)


13




Share of profit of associate companies


(30)


(270)


(233)




Equity-settled share-based provision


-


523


1,220




Tax expense


1,812


2,076


3,963




 


                 


                 


                 




Operating profit before changes in working capital and provisions


12,023


11,535


24,841




Increase in inventories


(6,430)


(2,442)


(11,816)




(Increase) / decrease in contract assets


(6,107)


(1,389)


1,361




Increase in trade and other receivables


(849)


(2,175)


(4,288)




Increase in contract liabilities


8,829


4,309


3,401




(Decrease) / increase in trade and other payables


(522)


3,005


1,965




(Increase) / decrease in unhedged derivative balances


(126)


617


(579)




 


                 


                 


                 




Cash inflow from operations


6,818


13,460


14,885




Interest paid


(320)


(193)


(524)




Corporation tax paid


(1,775)


(906)


(3,093)




Interest element of lease obligations


(48)


(32)


(64)




 


                 


                 


                 




Net cash from operating activities


4,675


12,329


11,204




 


 


 


 




Cash flow from investing activities


 


 


 




Proceeds from sale of property, plant and equipment


75


93


142




Acquisition of property, plant and equipment


(3,156)


(5,652)


(11,451)




Additional investment in existing subsidiaries


(74)


-


(2,668)




Acquisition of controlling interest in associates net of cash acquired


-


-


(425)




Acquisition of intangible assets


(74)


(232)


(315)




Development expenditure capitalised


(297)


(469)


(1,500)




Dividends received from associate companies


-


-


1,254




 


                 


                 


                 




Net cash outflow from investing activities


(3,526)


(6,260)


(14,963)




 


 


 


 




Cash flows from financing activities


 


 


 




Proceeds from issue of share capital


16


-


-




Payment of lease liability principal


(714)


(455)


(911)




Proceeds from new leases


5,054


-


424




Dividends paid


(6,927)


(6,074)


(6,126)




Dividends paid to non-controlling interests


-


(451)


(451)




Net proceeds from loans and committed facilities


6,949


1,977


8,337




 


                 


                 


                 




Net cash inflow / (outflow) from financing activities


4,378


(5,003)


1,273




 


                 


                 


                 




Net increase / (decrease) in cash and cash equivalents


5,527


1,066


(2,486)




Cash and cash equivalents at beginning of year


493


2,900


2,900




Effect of exchange rate fluctuations on cash held


56


(43)


79




 


                 


                 


                 




Closing cash and cash equivalents


6,076


3,923


493




 


                 


                 


                 




 
 
 
Notes
to the Condensed Consolidated Financial Statements
1.         Reporting entity
Goodwin PLC (the "Company") is a company incorporated in England and Wales. The unaudited condensed consolidated interim financial statements of the Company as at and for the six months ended 31st October 2019 comprise the Company, its subsidiaries, and the Group's interests in associates (together referred to as the "Group").
The audited consolidated financial statements of the Group as at and for the year ended 30th April 2019 are available upon request from the Company's registered office at Ivy House Foundry, Hanley, Stoke-on-Trent,  ST1 3NR or via the Company's web site:  www.goodwin.co.uk.
2.         Statement of compliance
These unaudited condensed consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted in the EU.  They do not include all of the information required for full annual financial statements, and should be read in conjunction with the audited consolidated financial statements of the Group as at and for the year ended 30th April 2019.
The comparative figures for the financial year ended 30th April 2019 are extracts and not the full Group's statutory accounts for that financial year. Those accounts have been reported on by the Company's auditors and delivered to the Registrar of Companies. The report of the auditors was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498(2) or (3) of the Companies Act 2006.
The Audit Committee has reviewed these unaudited condensed consolidated interim financial statements and has advised the Board of Directors that, taken as a whole, they are fair, balanced and understandable and provide the information necessary for shareholders to assess the Group's half year performance.  These unaudited condensed consolidated interim financial statements were approved by the Board of Directors on <Signing date>.
3.         Significant accounting policies
The accounting policies applied by the Group in these unaudited condensed consolidated financial statements are the same as those applied by the Group in its audited consolidated financial statements as at and for the year ended 30th April 2019, with the exception of IFRS 16 Leases (see note 5). The changes in accounting policies are to be reflected in the Group's consolidated financial statements as at and for the year ending 30th April 2020.
The following standards and amendments became effective and therefore were adopted by the Group.
· Amendments to IFRS 9 - Prepayment Features with Negative Compensation (effective for annual periods beginning on or after 1st January 2019)
· IFRIC Interpretation 23 - Uncertainty over Income Tax Treatments (effective for annual periods beginning on or after 1st January 2019)
· Amendments to IAS 28 - Long-term Interests in Associates and Joint Ventures (effective for annual periods beginning on or after 1st January 2019)
· Annual Improvements to IFRSs - 2015-17 Cycle - minor amendments to IFRS 3, IFRS 11, IAS 12 and IAS 23 (effective for annual periods beginning on or after 1st January 2019)
· IFRS 16 - Leases (effective for annual periods beginning on or after 1st January 2019)
The impact of IFRS 16 Leases, which replaces IAS 17 Leases and IFRIC 4, is outlined in note 5 below.  The Group has considered the impact on profit, earnings per share and net assets in future periods, of the other new standards and interpretations referred to above, and none of the above standards or interpretations is expected to have a material impact.
New IFRS standards, amendments and interpretations not adopted
The IASB and IFRIC have issued additional standards and amendments which are effective for periods starting after the date of these financial statements. The following standards and amendments have not yet been adopted by the Group:
· Amendments to IFRS 3 - Definition of a business (effective for annual periods beginning on or after 1st January 2020)
· Amendments to IAS 1 and IAS 8 - Definition of material (effective for annual periods beginning on or after 1st January 2020)
· Amendments to References to the Conceptual Framework in IFRS Standards (effective for annual periods beginning on or after 1st January 2020)
 
 
4.         Accounting estimates and judgements
The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense.  Actual results may differ from these estimates.
In preparing these unaudited consolidated interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the audited consolidated financial statements as at and for the year ended 30th April 2019, with the exception of leases (see note 5).
The tax charge in the period is based on management's estimate of the weighted average annual income tax rate expected for the full financial year applied to the pre-tax income of the interim period, and the impact of any disallowed costs.
5.         Changes in significant accounting policies
Except as described below, the accounting policies applied in these interim financial statements are the same as those applied in the Group's consolidated financial statements as at and for the year ended 30th April 2019.
The changes in accounting policies are also expected to be reflected in the Group's consolidated financial statements as at and for the year ending 30th April 2020.
The Group adopted IFRS 16 Leases initially from 1st May 2019. A number of other new standards are effective from 1st May 2019 but they are not expected to have a material effect on the Group's financial statements.
Prior to 1st May 2019, the Group's policy for operating leases was to recognise the lease payments in the statement of profit or loss on a straight-line basis over the term of the lease.  With the implementation of IFRS 16, subject to the recognition exemptions as outlined below, a right-of-use asset is now recognised on the balance sheet together with an associated lease liability corresponding to the minimum envisaged lease period.  Within the profit or loss account, depreciation is charged based on the expired element of the minimum lease term and finance charges expensed on an effective interest rate basis.  Instead of being reported within Property, plant and equipment, such assets acquired under finance leases are now reported as right-of-use assets.
The updated Group accounting policy for leases is as follows:
Definition of a lease
A contract is a lease or contains a lease if it transfers the right to use an identified asset over the contract term, in exchange for payment.  In determining whether a contract gives the Group the right to use an asset, the Group assesses whether:
•              the contract involves the use of an identified asset
•              the Group has the right to obtain substantially all of the economic benefits of using the asset; and
•              the Group has the right to direct the use of the asset by deciding how the asset is employed.
Lease term
The lease term is the non-cancellable period of a lease, and options to extend the lease or terminate it, where it is probable that the Group will exercise the available options.  At the start of a lease, the Group makes a judgement about whether it is reasonably certain to exercise the options, and reassesses this judgement at every reporting period.  Contracts, where the original lease term has expired, with assets continuing to be leased on a short-term rolling basis of a few months, are treated as short-term leases.
Lease balances
A right-of-use asset and a lease liability are calculated at the beginning of a lease.  The right-of-use asset is measured initially at cost, being the opening lease liability, adjusted for any lease payments made by the start of the lease, adjusted for any initial direct costs, which have been incurred. 
The lease liability is measured initially at the present value of the lease payments, which are outstanding at the start date, discounted at either the rate implicit in the lease or the Group's incremental borrowing rate.  With the exception of leases containing an option to purchase, the Group uses its incremental borrowing rate as the discount rate.  Lease liabilities are measured at amortised cost, using the effective interest rate, and adjusted as required for any subsequent change to the lease terms.
The right-of-use asset is depreciated on a straight-line basis over the lease term, or from the start date of the lease to the end of the useful life of the right-of-use asset as appropriate.  The method of calculating the estimated useful lives of right-of-use assets and testing for impairment is the same as that for property, plant and equipment.
 
Recognition exemptions
Payments for short-term leases, lasting twelve months or less, without a purchase option continue to be reported as an operating expense on a straight line basis over the term of the lease. 
The cost of leasing low-value items will continue to be reported as an operating expense over the life of the lease.
Lease portfolios
The Group has leases for the following types of assets:
Land and buildings
The Group leases a number of factory buildings, warehouses and office buildings.
Plant and equipment
A number of significant items of plant, such as CNC machines and furnaces, have been leased under contracts with an option to buy the asset at the end of the lease term.  The Group also leases a small number of motor vehicles.
Printers and photocopiers
The Group has applied the recognition exemption for low-value assets to these leases.
Accounting estimates and judgements
The Group's contracts are such that the terms are generally very clear in establishing whether they are or contain leases, and consequently, significant judgements have not been required in assessing the contracts.  The Group's incremental borrowing rates have been estimated separately for each country, in which leases are held, with rates ranging from 2.0% to 7.7%.
Transition
IFRS 16 has been implemented using the modified retrospective approach, because it does not require a full restatement of comparatives, but the cumulative opening impact is posted to reserves on the transition date.
For leases, which were previously classified as finance leases under IAS 17, the carrying amount of the right-of-use asset and lease liability on transition is the same as the carrying amount of the lease asset and lease liability calculated in accordance with IAS 17.
A right-of-use asset and lease liability are now recognised for leases considered to be operating leases in accordance with IAS 17.  As it is not possible to calculate the rate implicit in these leases, the lease liabilities are calculated as the present value of the remaining lease payments, discounted using the group's estimated incremental borrowing rate (IBR).  Right-of-use assets are reported as the same value as the lease liability, adjusted for any lease prepayments or accruals, at the transition date.
Practical expedients
The following practical expedients have been applied at the IFRS 16 application date.
•              There has been no re-assessment of leases treated as finance leases under IAS 17 as at 30th April 2019.
•              A single discount rate has been applied for similar leases.
•              Long term leases, which expire within twelve months of the transition date, have been treated as short term leases, with no right-of-use asset and lease liability being calculated.
•              Initial direct costs have been excluded, when measuring the right-of-use asset at the transition date.
The reconciliation of lease liabilities is shown below




 
 


 


 


 


Unaudited




 


 


 


 


£'000




 


 


 


 


 




Operating lease commitments at 30th April 2019


 


 


 


1,369




Impact of discounting minimum lease payments


 


 


 


(63)




Leases expiring before 30th April 2020


 


 


 


(44)




Short-term leases


 


 


 


(111)




Low value leases


 


 


 


(68)




Other reconciling items


 


 


 


(28)




 


 


 


 


                 




 


 


 


 


 




Additional lease liability at 1st May 2019


 


 


 


1,055




 


 


 


 


                 




 


 


 


 


 




Finance lease liability at 30th April 2019


 


 


 


2,103




 


 


 


 


                 




 


 


 


 


 




Total lease liability at 1st May 2019


 


 


 


3,158




 


 


 


 


                 




 


 


 


 


 




 
The IFRS 16 impact on the statement of profit or loss for the six months to 31st October 2019 is as follows:




 
 


 


 


 


Unaudited




 


 


 


 


£'000




Under IFRS 16


 


 


 


 




Operating profit


 


 


 


248




Financial expenses


 


 


 


27




 


 


 


 


                 




 


 


 


 


 




Impact on profit before tax


 


 


 


275




 


 


 


 


                 




 


 


 


 


 




Previously, under IAS 17


 


 


 


 




Reported as operating lease expenses within operating profit


 


 


 


267




 


 


 


 


                 




 


 


 


 


 




The IFRS 16 impact on the balance sheet as at 31st October 2019 is as follows:




 
 


 


Unaudited


Unaudited


Unaudited




 


 


IFRS 16


IFRS 16 adjustments


IAS 17




 


 


£'000


£'000


£'000




 


 


 


 


 




Property, plant and equipment


 


63,481


10,017


73,498




Right-of-use assets


 


11,798


(11,798)


-




Lease liabilities


 


(8,473)


1,789


(6,684)




 


 


                 


                 


                 




 


 


 


 


 




Impact on net assets


 


66,806


8


66,814




 


 


                 


                 


                 




 


 


 


 


 




 
6.         Operating Segments
Products and services from which reportable segments derive their revenues
In accordance with the requirements of IFRS 8 "Operating Segments" the Group's reportable segments based on information reported to the Group's Board of Directors for the purposes of resource allocation and assessment of segment performance are as follows:
•              Mechanical Engineering      - casting, machining and general engineering
•              Refractory Engineering        - powder manufacture and mineral processing
Information regarding the Group's operating segments is reported in the following tables. 
 
Segment Revenue




 


Mechanical Engineering


Refractory Engineering


Sub Total




 


Unaudited Half Year Ended   31st October 2019 


Unaudited Half Year Ended    31st October 2018 


Audited Year  Ended 30th    April  2019


Unaudited Half Year Ended   31st October 2019


Unaudited Half Year Ended   31st October 2018 


Audited Year  Ended  30th    April    2019


Unaudited Half Year Ended   31st October 2019


Unaudited Half Year Ended    31st October 2018 


Audited Year  Ended 30th   April   2019




 


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000




 
Revenue


 


 


 


 


 


 


 


 


 




External sales


47,244


45,052


82,375


22,846


22,496


44,671


70,090


67,548


127,046




Inter-segment sales


13,085


10,591


21,714


4,757


4,423


8,726


17,842


15,014


30,440




 


                


                


                


                


                


                


                


                


                




Total revenue


60,329


55,643


104,089


27,603


26,919


53,397


87,932


82,562


157,486




 


                


                


                


                


                


                


 


 


 




Reconciliation to consolidated revenues:


 


 


 


 


 


 


 




Inter-segment sales


 


 


 


 


 


 


(17,842)


(15,014)


(30,440)




 


 


 


 


 


 


 


                


                


                




Consolidated revenue for the period


 


 


 


 


70,090


67,548


127,406




 


 


 


 


 


 


 


                


                


                




Segment profits




 


 


 


 


 


 


 


 


 


 




 


Mechanical Engineering


Refractory Engineering


Sub Total




 


Unaudited Half Year Ended      31st   October  2019 


Unaudited Half Year Ended       31st    October   2018 


Audited Year    Ended   30th      April     2019


Unaudited Half Year Ended   31st October 2019


Unaudited Half Year Ended   31st October 2018 


Audited Year  Ended  30th    April    2019


Unaudited Half Year Ended   31st October 2019


Unaudited Half Year Ended      31st   October 2018 


Audited Year  Ended 30th   April   2019




 


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000




 
Profits


 


 


 


 


 


 


 


 


 




Segment result including associates


5,419


4,541


11,932


3,446


4,854


8,070


8,865


9,395


20,002




 


                 


                 


                 


                


                


                


 


 


 




Group administration costs


 


 


 


 


(1,010)


(765)


(2,138)




LTIP equity plan provision


 


 


 


-


(523)


(1,220)




Group finance expenses


 


 


 


 


(449)


(303)


(234)




 


 


 


 


 


 


 


                


                


                




Consolidated profit before tax for the period


 


 


 


 


7,406


7,804


16,410




Tax


 


 


 


 


(1,812)


(2,076)


(3,963)




 


 


 


 


 


 


 


                


                


                




Consolidated profit after tax for the period


 


 


 


 


5,594


5,728


12,447




 


 


 


 


 


 


 


                


                


                




Segment Assets and Liabilities




 


Segmental total assets


Segmental total liabilities


Segmental net assets




 


Unaudited Half Year Ended      31st   October  2019 


Unaudited Half Year Ended       31st    October   2018 


Audited Year    Ended   30th      April     2019


Unaudited Half Year Ended   31st October 2019


Unaudited Half Year Ended   31st October 2018 


Audited Year  Ended  30th    April    2019


Unaudited Half Year Ended   31st October 2019


Unaudited Half Year Ended      31st   October 2018 


Audited Year  Ended 30th   April   2019




 


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000




Mechanical Engineering


110,736


95,447


97,862


80,245


64,674


72,520


30,491


30,773


25,342




Refractory Engineering


44,191


40,207


43,950


23,125


19,859


25,541


21,066


20,348


18,409




 


                


                


                


                


                


                


                


                


                




Sub total reportable segment


154,927


135,654


141,812


103,370


84,533


98,061


51,557


51,121


43,751




 


                


                


                


                


                


                


 


 


 




Goodwin PLC (the Company) net assets


 


 


 


 


73,384


61,369


81,249




Elimination of Goodwin PLC investments


 


 


 


 


(25,301)


(20,960)


(25,374)




Goodwill


 


 


 


 


9,819


9,715


9,665




 


 


 


 


 


 


 


                


                


                




Consolidated total net assets


 


 


 


 


109,459


101,245


109,291




 


 


 


 


 


 


 


                


                


                




Segmental property, plant and equipment (PPE) capital expenditure


 


 


 


 




Goodwin PLC


 


 


 


 


1,456


2,408


3,602




Mechanical Engineering


 


 


 


 


1,172


3,039


6,461




Refractory Engineering


 


 


 


 


259


225


616




 


 


 


 


 


 


 


                


                


                




 


 


 


 


 


2,887


5,672


10,679




 


 


 


 


 


 


 


                


                


                




 
7.     Geographical segments




 


Half Year Ended 31st October 2019


Half Year Ended 31st October 2018




 


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited




 


Revenue


Operational assets


Non-current assets


PPE capital expenditure


Revenue


Operational assets


Non-current assets


PPE capital expenditure




 


£'000


£'000


£'000


£'000


£'000


£'000


£'000


£'000




UK


16,836


73,865


80,895


2,623


14,991


68,263


77,896


3,195




Rest of Europe


10,852


6,990


3,496


80


17,503


10,857


3,724


535




USA


6,787


-


-


-


2,138


-


-


-




Pacific Basin


18,111


15,464


7,528


45


14,762


15,064


7,888


17




Rest of World


17,504


13,140


7,021


139


18,154


7,061


6,367


1,925




 


                 


                 


                 


                 


                 


                 


                 


                 




Total


70,090


109,459


98,940


2,887


67,548


101,245


95,875


5,672




 


                 


                 


                 


                 


                 


                 


                 


                 




 


 


 




 


 


Year Ended 30th April 2019




 


 


 


 


 


Audited


Audited


Audited


Audited




 


 


 


 


 


Revenue


Operational assets


Non-current assets


PPE capital expenditure




 


 


 


 


 


£'000


£'000


£'000


£'000




UK


 


 


 


 


27,934


74,780


80,300


6,044




Rest of Europe


 


 


 


 


24,205


7,035


3,605


2,300




USA


 


 


 


 


8,100


-


-


-




Pacific Basin


 


 


 


 


28,956


14,779


6,855


84




Rest of World


 


 


 


 


37,851


12,697


6,944


2,251




 


 


 


 


 


                 


                 


                 


                 




Total


 


 


 


 


127,046


109,291


97,704


10,679




 


 


 


 


 


                 


                 


                 


                 




 
8.         Revenue
The Group's revenue is derived from contracts with customers.  The following tables provide an analysis of revenue by geographical market and by product line.




 


 


Mechanical Engineering


Refractory Engineering


Total




 


 


£'000


£'000


£'000




Primary Geographical markets


 


 


 


 




 


 


 


 


 




Unaudited half year ended 31st October 2019


 


 


 


 




UK


 


11,584


5,252


16,836




Rest of Europe


 


7,053


3,799


10,852




USA


 


6,735


52


6,787




Pacific Basin


 


6,988


11,123


18,111




Rest of World


 


14,884


2,620


17,504




 


 


                 


                 


                 




Total


 


47,244


22,846


70,090




 


 


                 


                 


                 




 




 


 


Mechanical Engineering


Refractory Engineering


Total




 


 


£'000


£'000


£'000




Primary Geographical markets


 


 


 


 




 


 


 


 


 




Unaudited half year ended 31st October 2018


 


 


 


 




UK


 


9,160


5,831


14,991




Rest of Europe


 


13,497


4,006


17,503




USA


 


2,097


41


2,138




Pacific Basin


 


6,570


8,192


14,762




Rest of World


 


13,728


4,426


18,154




 


 


                 


                 


                 




Total


 


45,052


22,496


67,548




 


 


                 


                 


                 




 


 


 


 


 




Product lines


 


 


 


 




 


 


 


 


 




Unaudited half year ended 31st October 2019


 


 


 


 




Standard products and consumables


 


5,131


22,846


27,977




Minimum period contracts for goods and services


 


2,171


-


2,171




Bespoke engineered products - over time


 


25,146


-


25,146




Bespoke engineered products - point in time


 


14,796


-


14,796




 


 


                 


                 


                 




Total


 


47,244


22,846


70,090




 


 


                 


                 


                 




 


 


 


 


 




Unaudited half year ended 31st October 2018


 


 


 


 




Standard products and consumables


 


3,935


22,496


26,431




Minimum period contracts for goods and services


 


2,006


-


2,006




Bespoke engineered products - over time


 


12,441


-


12,441




Bespoke engineered products - point in time


 


26,670


-


26,670




 


 


                 


                 


                 




Total


 


45,052


22,496


67,548




 


 


                 


                 


                 




 


 


 


 


 




9.         Dividends
The Directors do not propose the payment of an interim dividend.




 
 


 


Unaudited


Unaudited


Audited




 


 


Half Year to


Half Year to


Year Ended




 


 


31st October 2019


31st October 2018


30th April 2019




 


 


£'000


£'000


£'000




Equity Dividends Paid:


 


 


 


 




Ordinary dividends paid during the period in respect of the year ended 30th April 2019 (96.21p per share)


 


6,927


-


-




Ordinary dividends paid during the period in respect of the year ended 30th April 2018 (83.473p per share)


 


-


6,010


6,010




Dividends paid to minority shareholders in Noreva GmbH


 


-


64


116




 


 


                 


                 


                 




Total dividends paid during the period


 


6,927


6,074


6,126




 


 


                 


                 


                 




 


 


 


 


 




 
10.       Earnings Per Share
The calculation of the basic earnings per ordinary share is based on the number of ordinary shares in issue. For all periods up to and including 30th April 2019 this amounted to 7,200,000 shares and with effect from the 16th October 2019 this has increased to 7,363,200 shares. The weighted average number of ordinary shares in issue during the six months ended 31st October 2019 was 7,213,304.  The relevant profits attributable to ordinary shareholders were £5,260,000 (half year ended 31st October 2018: £5,393,000).
 
There is a share option scheme in place for the Directors of the Company under the Company's Equity Long Term Investment Plan (LTIP), based on the Company exceeding a target growth in the total shareholder return of the Company over the period from 1st May 2016 to 30th April 2019.  Under the scheme, a maximum of 489,600 share options vested at 1st May 2019, of which 163,200 were exercised during the current period. The total number of shares used as the denominator for the diluted earnings per share is 7,538,727 (half year ended 31st October 2018: 7,344,000; year ended 30th April 2019: 7,688,056).
11.       Capital Management, Issuance and Repayment of Debt
At 31st October 2019 the capital utilised was £132,217,000 as shown below:




 
 


 


Unaudited


Unaudited


Audited




 


 


as at


as at


as at




 


 


31st October 2019


31st October 2018


30th April 2019




 


 


£'000


£'000


£'000




 


 


 


 


 




Cash and cash equivalents


 


(9,416)


(7,577)


(9,640)




Lease liabilities - finance leases (note 15)


 


6,684


2,539


2,103




Bank loans and committed facilities


 


26,390


13,088


19,434




Bank overdrafts


 


3,340


3,654


9,147




Deferred consideration


 


204


500


204




 


 


                 


                 


                 




Net debt


 


27,202


12,204


21,248




Total equity attributable to equity holders of the parent


 


105,015


96,516


105,165




 


 


                 


                 


                 




Capital


 


132,217


108,720


126,413




 


 


                 


                 


                 




12.       Property, Plant and Equipment




 
 


 


Unaudited


Unaudited




 


 


as at


as at




 


 


31st October 2019


31st October 2018




 


 


£'000


£'000




 


 


 


 




Net book value at the beginning of the period


 


74,106


69,154




Additions


 


2,887


5,672




Transfer to right-of-use assets - on transition (as required by IFRS 16)


 


(3,959)


-




Transfer to right-of-use assets - finance lease (as required by IFRS 16)


 


(6,134)


-




Disposals (at net book value)


 


(77)


(82)




Depreciation


 


(3,180)


(2,764)




Exchange adjustment


 


(162)


(267)




 


 


                 


                 




Net book value at the end of the period


 


63,481


71,713




 


 


                 


                 




 


 


 


 




During October 2019, the Group took out a £5,000,000 seven year finance lease on two induction furnaces and a water quench facility, resulting in the equipment being transferred to the right-of-use assets category.
13.       Right-of-use assets




 


 


Unaudited as at 31st October 2019




 


 


Land and buildings - formerly operating leases


Plant and equipment - finance leases


Plant and equipment - formerly operating leases


 
 
Total




 


 


£'000


£'000


£'000


£'000




 


 


 


 


 


 




Balance recognised on transition


 


1,008


-


47


1,055




Transfer from property, plant and equipment


 


-


3,959


-


3,959




Additions


 


929


77


-


1,006




Finance lease transfer


 


-


6,134


-


6,134




Depreciation


 


(232)


(141)


(16)


(389)




Exchange adjustment


 


43


(10)


-


33




 


 


                 


                 


                 


                 




Net book value at the end of the period


 


1,748


10,019


31


11,798




 


 


                 


                 


                 


                 




 


 


 


 


 


 




14.       Intangible assets




 
 


 


Unaudited


Unaudited




 


 


as at


as at




 


 


31st October 2019


31st October 2018




 


 


£'000


£'000




 


 


 


 




Net book value at the beginning of the period


 


22,354


21,138




Additions


 


535


701




Amortisation


 


(484)


(549)




Exchange adjustment


 


78


18




 


 


                 


                 




Net book value at the end of the period


 


22,483


21,308




 


 


                 


                 




 


 


 


 




 
15.       Lease liabilities




 
 


 


Unaudited


Unaudited


Unaudited




 


 


as at


as at


as at




 


 


31st October 2019


31st October 2019


31st October 2019




 


 


Finance leases


Right-of-use leases


Total




 


 


£'000


£'000


£'000




 


 


 


 


 




Opening balance - IAS 17


 


2,103


-


2,103




Balance recognised on transition


 


-


1,055


1,055




Additions


 


5,054


1,006


6,060




Interest expense


 


21


27


48




Repayment of lease liabilities (including interest)


 


(518)


(244)


(762)




Exchange adjustment


 


24


(55)


(31)




 


 


                 


                 


                 




 


 


6,684


1,789


8,473




 


 


                 


                 


                 




 


 


 


 


 




16.  Total Financial Assets and Financial Liabilities
The following table sets out the Group's accounting classification of its financial assets and financial liabilities, and their carrying amounts at 31st October 2019.  The carrying amount is a reasonable approximation of fair value for all financial assets and financial liabilities.




 
 


 


Fair value - hedging instruments


FVTPL


Amortised cost


Total carrying amount / fair value amount




 


 


£'000


£'000


£'000


£'000




Financial assets measured at fair value


 


 


 


 


 




Forward exchange contracts used for hedging


 


2,143


-


-


2,143




Other forward exchange contracts


 


-


104


-


104




 


 


                 


                 


                 


                 




 


 


2,143


104


-


2,247




 


 


                 


                 


                 


                 




Financial assets not measured at fair value


 


 


 


 


 




Cash and cash equivalents


 


-


-


9,416


9,416




Contract assets


 


-


-


9,846


9,846




Trade receivables and other financial assets


 


-


-


24,981


24,981




 


 


                 


                 


                 


                 




 


 


-


-


44,243


44,243




 


 


                 


                 


                 


                 




Financial liabilities measured at fair value


 


 


 


 


 




Forward exchange contracts used for hedging


 


1,276


-


-


1,276




Other forward exchange contracts


 


-


276


-


276




Contingent consideration


 


-


204


-


204




 


 


                 


                 


                 


                 




 


 


1,276


480


-


1,756




 


 


                 


                 


                 


                 




 


 


 


 


 


 




Financial liabilities not measured at fair value


 


 


 


 


 




Bank overdrafts


 


-


-


3,340


3,340




Bank loans


 


-


-


26,390


26,390




Finance lease liabilities


 


-


-


8,473


8,473




Contract liabilities


 


-


-


27,068


27,068




Trade payables and other financial liabilities


 


-


-


18,174


18,174




 


 


                 


                 


                 


                 




 


 


-


-


83,445


83,445




 


 


                 


                 


                 


                 




 
The forward exchange contract assets and liabilities fair values in the above table are derived using Level 2 inputs as defined by IFRS 7 as detailed in the paragraph below.
IFRS 7 requires that the classification of financial instruments at fair value be determined by reference to the source of inputs used to derive the fair value. This classification uses the following three-level hierarchy:  Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 - inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); Level 3 - inputs for the asset or liability that are not based on observable market data (unobservable inputs).
 




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