REG - Leeds Group PLC - Final Results
Issued on behalf of Leeds Group plc Embargoed: 7.00am
Date: 18 October 2021
Leeds Group plc
("Leeds Group" or "the Group")
Final Results for the year ended 31 May 2021
Leeds Group reports the final results of the Group for the year to 31 May 2021.
This announcement contains inside information for the purposes of the UK Market Abuse Regulation and has been arranged for release by Jan G Holmstrom, Non-Executive Chairman. The Directors of the Company are responsible for the release of this announcement.
Enquiries:
Leeds Group plc Cairn Financial Advisers LLP
Dawn Henderson - 01937 547877 Liam Murray/Sandy Jamieson - 020 7213 0880
Chairman's Statement
As a result of the ongoing global pandemic, it has been another challenging year for the Group. In our interim report we announced that sales for Hemmers and KMR in the first six months of the financial year had been higher than expected. In subsequent trading updates on 17 February 2021 and 18 May 2021, we explained that since the half year end, there had been further countrywide restrictions imposed by the German government which had adversely affected trading activity in the second half of the financial year.
Both Hemmers-Itex Textil Import Export GmbH ('Hemmers') and Stoff-Ideen-KMR GmbH ('KMR') businesses have been affected by the countrywide lockdowns imposed by the German government in response to the Covid-19 pandemic and further government-imposed restrictions placed on retail shops thereafter. Hemmer's wholesale business was also affected by lockdowns in its export markets though trading continued on a reduced basis. However, all KMR's retail shops were fully closed during the country-wide lockdowns which lasted until early March 2021 with some shops remaining closed until the end of May 2021 due to localised lockdowns. The effect of the KMR shop closures were partly mitigated by actions taken by management and by government financial aid. The Group operating result showed a reduced loss of £280,000 compared to the previous year loss of £1,756,000.
Even though the lockdown has now been lifted, the Covid-19 pandemic is still having an impact in the global marketplace, with sales levels for both Hemmers and KMR in the first quarter of the new financial year lower than previous years but in line with expectations. The impact of Covid-19 on the Group is detailed further in the Finance and Operating Review. The Directors are confident that both businesses are prepared to mitigate the risk of a further wave of the pandemic and should restrictions be imposed again, the companies would take the necessary actions and also apply for any available government financial support.
Following the prior year sales and cost reviews, the Directors believe that the Group is structured to align its costs with sales activity and has a stronger management team with a competitive sales strategy. This strategy will potentially return the Group to acceptable levels of profit in future years, assuming a return to a normal trading environment.
On behalf of shareholders, I want to thank the management and staff of Hemmers and KMR who have all continued with their best efforts to work through difficult and challenging times in the face of the global pandemic.
Jan G Holmstrom
Non-Executive Chairman
15 October 2021
Finance and Operating Review
Group result
Group revenue for the continuing operations in the year was £33,013,000 (2020: £35,067,000). The ongoing effects of the Covid-19 pandemic affected both Hemmers and KMR. Although the German government provided financial support to the Group amounting to £966,000, the reduced sales figures did not generate enough contribution to cover the fixed overheads and, therefore, both Hemmers and KMR made a loss after interest. The Group's operating loss from continuing activities was £280,000 (2020: loss £1,756,000) and the Group's loss before tax from continuing activities was £508,000 (2020: loss £2,016,000).
The tax credit in the year was £42,000 (2020: charge £6,000). The total loss per share was 1.7p (2020: loss per share 8.6p).
Hemmers-Itex
Hemmers is a global business engaged in designing, importing, warehousing and wholesaling of fabrics from Germany. The market in Germany has been affected by the Covid-19 pandemic, however Hemmers have positioned themselves well in the marketplace and have managed to secure business from competitors. The strategic sales review coupled with the comprehensive cost review undertaken last year has ensured the cost base for Hemmers is aligned to the current sales levels and market conditions. Sales for the year were slightly higher than last year at £27,669,000 (2020: £27,060,000) due to exchange translation as sales volumes were in line with previous years but lower than expectations. The gross contribution percentage decreased slightly to 30% (2020: 31%) due to the pressure on pricing through competition however, with the increased level of sales, the gross contribution has increased to £4,580,000 (2020: £4,155,000). Due to the reduction in fixed overheads resulting from the prior year cost review and government financial assistance of £274,000, Hemmers achieved a profit before interest of £330,000 (2020: loss £1,298,000).
Hemmers is completely focused on growing its business domestically and internationally in its wholesale markets with a more customer focused sales strategy. We are confident that Hemmers will continue to compete in the global marketplace regaining further market share thus returning to profitability after interest.
Hemmers bank debt, net of cash, increased in the year to £3,558,000 (2020: £3,184,000). The bank debt is secured on the assets of Hemmers.
KMR
KMR is a retail trading business in Germany. KMR has been severely affected by the Covid-19 pandemic resulting in the closure of all its retail shops during countrywide lockdowns. Also following the lifting of the second government-imposed lockdown, local lockdowns were imposed due to the level of Covid-19 infections in certain areas. This affected certain KMR retail shops for a further eleven weeks in this financial year. Sales were, therefore, significantly lower than last year at £5,344,000 (2020: £8,007,000). The gross contribution percentage increased slightly to 56% (2020: 53%) due to price increases. This lower level of trading, despite financial support from the German government amounting to £692,000, has resulted in a loss before interest for the year of £211,000 (2020: loss £218,000). Improved working efficiencies have been implemented during the year including the introduction of new working patterns resulting in a reduced cost base. This is expected to eliminate the losses going forward and provide a better foundation for improved results in the coming years.
KMR bank debt, net of cash, decreased in the year to £749,000 (2020: £979,000). The bank debt is secured on the assets of KMR.
Fixed Assets
The net book amount of tangible fixed assets is £7,750,000 (2020: £8,183,000). Capital additions in the year amounted to £562,000 (2020: £560,000).
The net book value of right-to-use assets is £2,453,000 (2020: £2,374,000). There were £750,000 of additional right-of-use leases included as assets in the year although they relate to leases which were regarded as short-term leases in 2020 (2020: £258,000). An impairment charge of £333,000 has been recognised in the accounts in relation to these assets.
Working Capital and Cash Flow
Net debt increased from £3,517,000 to £3,952,000 in the year. Net cash used in the year at average exchange rates was £610,000 (2020: generated £34,000). Working capital, which comprises inventories, trade and other receivables and trade and other payables, increased in the year by £452,000 (2020: decreased £2,738,000). Debtor and Trade Creditor levels were lower at 31 May 2021 due to the reduced trading in March to May as a result of the effects of the Covid-19 pandemic on trading. Loan repayments of £771,000 (2020: £2,378,000) have been made this year. Last year the repayments were partly due to the sale of properties which generated £1,317,000 with the corresponding debt being repaid. New loans taken out in the year £787,000 relating to short term debt. Lease liability repayments (including interest) of £1,059,000 (2020: £926,000) have been made in the year.
The Group continues to carefully monitor its working capital requirements to ensure it operates within its current banking facilities.
Net Asset Value
Net assets decreased in the year by £1,022,000 as follows:
Net assets
£000
Per share
pence
At 31 May 2020
15,583
57.0
Loss after tax
(466)
(1.7)
Translation differences
(556)
(2.0)
At 31 May 2021
14,561
53.3
Debt Profile
The funding policy of the Group continues to be to match its funding requirement in trading subsidiaries in a cost-effective fashion with an appropriate combination of short and longer-term debt. Property investments have been financed partly by long term loans at fixed interest rates between 1.05% and 4.07%. Working capital finance, when required, is via short term loans of three months currently attracting interest at rates of between 1.25% and 3%. Bank debt in the subsidiaries is secured by charges on inventories, receivables and property and is without recourse to the Parent Company.
Share Capital
During the year, the Company cancelled 4,279,157 ordinary shares that had been held in treasury following previous purchases of the shares by the Company.
Impairment reviews
A cash generating unit is defined by IAS36 as the smallest identifiable group of assets that generates cash flows that are largely independent of the cash inflows from other assets, or group of assets. As such, each store in KMR represents its own cash generating unit. Following the implementation of IFRS16, the right-of-use assets relating to KMR's retail shops are now considered part of the cash generating units. Other immaterial assets are allocated to each store to consider the wider asset portfolio of each store, where right-of-use assets remain the only material in scope assets to consider in impairment testing. Although annual impairment reviews are not required on tangible assets, management have performed an impairment review on these assets due to historic trading losses and the effects of the Covid-19 pandemic. Impairment tests have been performed by assessing relevant cash flows of each cash generating unit and assessing this against the value of assets relating to that specific cash generating unit to consider recoverable amounts. Following this review, an impairment charge of £333,000 has been recognised during this financial year.
Principal risks and uncertainties
The Board has identified the main categories of business risk in relation to the Group's strategic aims and objectives, and has considered reasonable steps to prevent, mitigate and manage these risks. The principal risks identified are as follows:
Funding risk
The Group has a combination of short-term borrowing facilities and longer-term loan agreements secured on Group assets. The Group remains dependent upon the support of these funders and there is a risk that failure in a company to meet banking covenants could have implications for the Group. Borrowing facilities are monitored regularly and the facilities agreed are more than needed for the Group's requirements. The Group has close working relationships with their current funders but believe alternative banking funders could be secured if required.
Hemmers has a maximum working capital facility of €11m, restricted to the borrowing base which is calculated as 70% of eligible inventory and 80% of eligible debtors. In the financial year 2021, this resulted in average availability of €7.7m (2020: €8.8m) with a range of €6.9m to €8.3m (2020: €8.0m to €9.0m) and minimum headroom of €4.5m (2020: €4.7m) in the year. In the forecast period to 31 May 2023, the estimated availability range is €6.9m to €8.8m and the minimum headroom €3.4m. The only covenant on this facility is an equity ratio which must exceed 30% of gross assets at the financial year end. At 31 May 2021, the ratio was higher than 60% (2020: 61%). The facility is uncommitted, but the bank is obliged to give reasonable notice of any change.
KMR has a fixed working capital loan facility of €1m which was fully drawn at the year end and a €0.5m bank overdraft facility secured on working capital, of which €0.2m was utilised as at 31 May 2021. The covenants on these facilities are (i) an equity ratio which must exceed 35% of gross assets at the financial year end and (ii) the ratio of working capital/bank facility should be a minimum 1.5x. At 31 May 2021, these ratios were 55.5% (2020: 39.5%) and 1.54 (2020: 1.58). The facilities are uncommitted, but the bank is obliged to give reasonable notice of any change.
Considering the trading results in the first quarter of the current financial year, the likely ongoing impact of the Covid-19 pandemic and the headroom available on the Hemmers working capital facility, the Directors are of the opinion that it is appropriate to apply the going concern basis of preparation to the financial statements.
Market risk
There is always the ongoing threat of reduced market demand. This has been seen this year and the Group continues to strive to combat the reduced demand by looking at other markets both domestically and internationally and looking at expanding its product ranges. The commercial risks of operating in the highly competitive European fabric market are limited by the fact that Hemmers has a wide range of suppliers, and no customer accounts for more than 5% of revenues.
Foreign exchange risk
Most fabric purchased by Hemmers is paid for in US dollars, while the Euro is the principal currency in which Hemmers sells its product. The Euro/dollar rate is of greater significance to Leeds Group than the strength of Sterling. The Hemmers management continue to manage this transactional currency risk by a combination of forward exchange contracts with reputable banks and sales price increases where necessary.
Covid-19
During the year, the global Covid-19 pandemic which resulted in lockdowns across the world, has affected both businesses. This affected the last six weeks of the last financial year, late March 2020 to early May 2020 and twelve weeks of this financial year from mid December 2020 to early March 2021. KMR, whose main business is retail shops, was required to close all its shops during the two government-imposed lockdowns and, then some of its shops were required to close due to further local lockdowns. The financial impact on all businesses was partly mitigated by financial support from the German government. Financial support was provided to cover the wages of staff unable to work due to the country wide lockdown. Additional support was provided based on reduced turnover of the combined Hemmers and KMR group and additional compensation for certain seasonal goods sold at a loss. There is a risk that if infections of Covid-19 are not controlled that a further country wide or local lockdown will be required. It is expected that in this event, Government support would again be provided, and management have looked at further measures to mitigate the risk having experienced this in the first and second waves of the pandemic.
The ongoing effects of the Covid-19 pandemic are still being experienced globally with markets not fully recovered and supply chain issues. Although the Group is affected by these issues, we are currently managing delays in deliveries effectively through good stock management and any increased costs associated with container shipments from the Far East are being recovered through an increase in sales prices.
Brexit
Following the UK's departure from the European Union ("EU") on 31 December 2020, the Group has seen little impact of this departure and the Directors do not expect this impact to change. The business of Leeds Group is conducted entirely by subsidiaries incorporated in Germany, and their exports to the UK account for approximately 4% only of Group revenue.
Jan G Holmstrom
Non-Executive Chairman
15 October 2021
Consolidated Statement of Comprehensive Income
for the year ended 31 May 2021
Year ended
31 May 2021
£000
Year ended
31 May 2020
£000
Continuing operations
Revenue
33,013
35,067
Cost of sales
(26,700)
(29,039)
Gross profit
6,313
6,028
Distribution costs
(2,647)
(2,876)
Administrative costs
(4,912)
(4,908)
Other income
966
-
Loss from operations
(280)
(1,756)
Finance expense
(228)
(260)
Loss before tax
(508)
(2,016)
Tax credit/(charge)
42
(6)
Loss from continuing operations
(466)
(2,022)
Discontinued operations
Loss from discontinued operations
-
(332)
Loss for the year attributable to the equity holders of the Parent Company
(466)
(2,354)
Other comprehensive (loss)/income
Translation differences on foreign operations
(556)
196
Total comprehensive loss for the year attributable to the equity holders of the Parent Company
(1,022)
(2,158)
There is no tax effect relating to other comprehensive income for the year. Amounts included in other comprehensive income may be reclassified subsequently as profit or loss.
Loss per share attributable to the equity holders of the Company
Year ended
31 May 2021
Year ended
31 May 2020
Basic and diluted total loss
per share (pence)
1.7p
8.6p
Consolidated Statement of Financial Position
at 31 May 2021
Company number 00067863
31 May 2021
£000
31 May 2020
£000
Assets
Non-current assets
Property, plant and equipment
7,750
8,183
Right-of-use assets
2,453
2,374
Intangible assets
58
67
Total non-current assets
10,261
10,624
Current assets
Inventories
10,287
10,188
Trade and other receivables
2,867
3,464
Tax recoverable
136
206
Cash on demand and on short term deposit
670
1,104
Total current assets
13,960
14,962
Total assets
24,221
25,586
Liabilities
Non-current liabilities
Loans and borrowings
(1,498)
(1,950)
Lease liabilities
(1,856)
(1,478)
Total non-current liabilities
(3,354)
(3,428)
Current liabilities
Trade and other payables
(2,265)
(2,877)
Loans and borrowings
(2,926)
(2,671)
Lease liabilities
(1,015)
(927)
Provisions
(100)
(100)
Total current liabilities
(6,306)
(6,575)
Total liabilities
(9,660)
(10,003)
TOTAL NET ASSETS
14,561
15,583
Capital and reserves attributable to
equity holders of the Company
Share capital
3,279
3,792
Capital redemption reserve
1,113
600
Treasury share reserve
-
(807)
Foreign exchange reserve
2,185
2,741
Retained earnings
7,984
9,257
TOTAL EQUITY
14,561
15,583
The financial statements were approved and authorised for issue by the Board of Directors on 15 October 2021 and were signed on behalf of the Board by:-
Jan G Holmstrom
Non-Executive Chairman
Consolidated Cash Flow Statement
for the year ended 31 May 2021
Year ended
31 May 2021
£000
Year ended
31 May 2020
£000
Cash flows from operating activities
Loss for the year
(466)
(2,354)
Adjustments for:
Government assistance credit
(966)
-
Depreciation of property, plant and equipment
624
723
Depreciation of right-of-use assets
1,062
876
Impairment of right-of-use assets
333
-
Depreciation of investment property
-
13
Amortisation of intangible assets
6
6
Finance expense - interest on bank loans
154
174
Finance expense - interest lease liabilities
74
86
Gain on sale of property, plant and equipment
(14)
(32)
Tax (credit)/charge
(42)
6
Cash flows from/(to) operating activities before
changes in working capital and provisions
765
(502)
(Increase)/decrease in inventories
(571)
1,735
Decrease in trade and other receivables
718
965
(Decrease)/increase in trade and other payables
(599)
38
Cash generated from operating activities
313
2,236
Tax received
110
519
Net cash flows from operating activities
423
2,755
Investing activities
Purchase of property, plant and equipment
(562)
(560)
Proceeds from the sale of fixed assets
21
1,317
Net cash (used in)/generated from investing activities
(541)
757
Financing activities
Bank borrowings drawn
787
-
Bank borrowings repaid
(771)
(2,378)
Repayment of principal on lease liabilities
(985)
(840)
Repayment of interest on lease liabilities
(74)
(86)
Bank interest paid
(154)
(174)
Government assistance received
705
-
Net cash used in financing activities
(492)
(3,478)
Net (decrease)/increase in cash and cash equivalents
(610)
34
Translation (loss)/gain on cash and cash equivalents
(22)
5
Cash and cash equivalents at the beginning of the year
1,104
1,065
Cash and cash equivalents at the end of the year
472
1,104
Cash on demand or on short term deposit
670
1,104
Bank overdrafts
(198)
-
Cash and cash equivalents at the end of the year
472
1,104
Consolidated Statement of Changes in Equity
for the year ended 31 May 2021
Share capital
£000
Capital redemption reserve
£000
Treasury share reserve
£000
Foreign exchange reserve
£000
Retained earnings
£000
Total equity
£000
At 31 May 2019
3,792
600
(807)
2,545
11,611
17,741
Loss for the year
-
-
-
-
(2,354)
(2,354)
Other comprehensive income
-
-
-
196
-
196
Total comprehensive income/(loss)
-
-
-
196
(2,354)
(2,158)
At 31 May 2020
3,792
600
(807)
2,741
9,257
15,583
Cancellation of treasury shares
(513)
513
807
-
(807)
-
Loss for the year
-
-
-
-
(466)
(466)
Other comprehensive loss
-
-
-
(556)
-
(556)
Total comprehensive loss
-
-
-
(556)
(466)
(1,022)
At 31 May 2021
3,279
1,113
-
2,185
7,984
14,561
The following describes the nature and purpose of each reserve within equity:
Reserve
Description and purpose
Share capital
The nominal value of issued ordinary shares in the Company.
Capital redemption reserve
Amounts transferred from share capital on redemption of issued shares.
Treasury share reserve
Cost of own shares held in treasury.
Foreign exchange reserve
Gains/(losses) arising on retranslation of the net assets of overseas operations into sterling.
Retained earnings
Cumulative net gains/(losses) recognised in the consolidated statement of comprehensive income after deducting the cost of cancelled treasury shares.
Notes
1. Basis of preparation
This announcement has been prepared in accordance with International Accounting Standards in conformity with the Companies Act 2006.
Going Concern
When considering its opinion about the application of the going concern basis of preparation of the financial statements to 31 May 2021, the Directors have given due consideration to:
· The performance of the Group in the last financial year and the robustness of forecasts for the next 24 months, which return the Group to profit.
· Any downside sensitivities including the impact of the Covid-19 pandemic on the business, its suppliers and its customers.
· The financing facilities available to the Group and the circumstances in which these could be limited or withdrawn.
Financial performance and forecasts
Having been consistently profitable in the past, the Group has been loss making in each of the last three years.
· In the year to 31 May 2019, the Group reported a pre-tax loss from continuing operations of £1.3m after writing off goodwill of £1.0m.
· In the year to 31 May 2020, the Group reported a pre-tax loss from continuing operations of £2.0m. Approximately £1.0m of this loss arose in the final quarter which was significantly impacted by the Covid-19 restrictions discussed below. To address the poor underlying performance the Directors and management restructured the business in the first half of the year to focus on profitable business streams and reduce its operating costs. Restructuring costs of £0.4m were incurred in the financial year which will benefit results going forward. Although loss making, the business was cash generative in the year with net debt reducing by £2.4m, of which £1.3m resulted from the sale of investment properties.
· In the year to 31 May 2021, the Group reported a pre-tax loss from continuing operations of £0.5m primarily due to the ongoing impact of the Covid-19 pandemic.
Forecasts have been prepared for the 24-month period to May 2023 which indicate a return to modest profit over that period. These forecasts have been prepared in the knowledge of current Covid-19 conditions and assume that there is no further period of total country-wide lockdown. At the end of the first quarter of the current financial year sales and profit were in line with forecast. The company has sensitised these forecasts for a reduction in revenues of 10% at both Hemmers and KMR in the forecast period and an additional net €1 million profit reduction from a second period of lockdown. The Directors are of the opinion that this is a reasonable worst case, and the currently available facilities would be sufficient in this scenario.
Covid-19 Impact
Both Hemmers and KMR are located in Germany which has responded well to the outbreak. KMR was most directly impacted by the measures put in place with all shops closed from late March 2020 to early May 2020 and again from mid December 2020 to early March 2021 with further local restrictions from early March 2021 to late May 2021. Since the start of the financial year, the shops have performed in line with forecast with all restrictions lifted. Hemmers has traded in line with forecast in the first quarter of the current year
Both businesses have been supported by the government employment scheme which reimburses the company for payments to employees for any short time working. The German government also provides a scheme whereby companies can be compensated for a reduction in trading with reference to reduced turnover and goods sold at reduced margins as a result of the pandemic. This scheme will remain available through any further affected periods. In addition, KMR has negotiated rent reductions for its shops in the current financial year which are reflected in the forecasts.
The ongoing effects of the Covid-19 pandemic are still being experienced globally with markets not fully recovered and supply chain issues. Although the Group is affected by these issues, we are currently managing delays in deliveries effectively through good stock management and any increased costs associated with container shipments from the Far East are being recovered through an increase in sales prices. While there is clearly uncertainty about the future course of the pandemic, the Directors consider that with ongoing government support it is well placed to trade through reasonably foreseeable scenarios.
2. Dividends
The Directors do not recommend the payment of a dividend in 2021 (2020: £nil).
3. Loss per share
Year ended
31 May 2021
Year ended
31 May 2020
Numerator
Total loss for the year
£466,000
£2,354,000
Denominator
Weighted average number of shares
27,320,843
27,320,843
Basic and diluted total loss per share
1.7p
8.6p
Numerator
Loss for the year from continuing operations
£466,000
£2,022,000
Denominator
Weighted average number of shares
27,320,843
27,320,843
Basic and diluted loss from continuing operations per share
1.7p
7.4p
Numerator
Loss for the year from discontinued operations
-
£332,000
Denominator
Weighted average number of shares
-
27,320,843
Basic and diluted loss from discontinued operations per share
-
1.2p
Since there are no outstanding share options, there is no difference between basic and diluted earnings per share.
4. Segmental information
Year ended
31 May 2021
Hemmers
£000
KMR
£000
Inter segmental
£000
Parent Company
£000
Continuing operations
£000
Discontinued
operations £000
Total
Group
£000
External revenue
27,669
5,344
-
-
33,013
-
33,013
Inter-segmental revenue
1,071
1
(1,072)
-
-
-
-
Cost of sales
(24,160)
(3,602)
1,062
-
(26,700)
-
(26,700)
Gross profit
4,580
1,743
(10)
-
6,313
6,313
Distribution costs
(1,499)
(1,148)
-
-
(2,647)
-
(2,647)
Admin expenses
(3,212)
(1,498)
187
(389)
(4,912)
-
(4,912)
Other income
461
692
(187)
-
966
-
966
Operating profit/(loss)
330
(211)
(10)
(389)
(280)
-
(280)
Finance expense
(128)
(100)
-
-
(228)
-
(228)
Internal interest
(213)
-
-
213
-
-
-
Loss before tax
(11)
(311)
(10)
(176)
(508)
-
(508)
At 31 May 2021
Hemmers
£000
KMR
£000
Adj
£000
Parent Company
£000
Continuing operations
£000
Discontinued
operations £000
Total
Group
£000
Total assets
15,803
5,688
(174)
2,904
24,221
-
24,221
Total liabilities
(5,589)
(3,969)
-
(102)
(9,660)
-
(9,660)
Total net assets
10,214
1,719
(174)
2,802
14,561
-
14,561
Year ended
31 May 2020
Hemmers
£000
KMR
£000
Inter segmental
£000
Parent Company
£000
Continuing operations
£000
Discontinued
operations £000
Total
Group
£000
External revenue
27,060
8,007
-
-
35,067
488
35,555
Inter-segmental revenue
1,563
5
(1,681)
-
(113)
113
-
Cost of sales
(24,468)
(5,930)
1,472
-
(28,926)
(697)
(29,623)
Gross profit/(loss)
4,155
2,082
(209)
-
6,028
(96)
5,932
Distribution costs
(1,628)
(1,312)
64
-
(2,876)
(51)
(2,927)
Admin expenses
(3,913)
(988)
233
(240)
(4,908)
(185)
(5,093)
Other income
88
-
(88)
-
-
-
-
Operating loss
(1,298)
(218)
-
(240)
(1,756)
(332)
(2,088)
Finance expense
(147)
(113)
-
-
(260)
-
(260)
Internal interest
(148)
-
-
148
-
-
-
Loss before tax
(1,593)
(331)
-
(92)
(2,016)
(332)
(2,348)
At 31 May 2020
Hemmers
£000
KMR
£000
Inter segmental
£000
Parent Company
£000
Continuing operations
£000
Discontinued
operations £000
Total
Group
£000
Total assets
16,998
5,745
(218)
3,061
25,586
-
25,586
Total liabilities
(5,769)
(4,151)
-
(83)
(10,003)
-
(10,003)
Total net assets
11,229
1,594
(218)
2,978
15,583
-
15,583
5. Loans and borrowings
The book value of loans and borrowings are as follows:
31 May 2021
£000
31 May 2020
£000
Current
Secured bank loans
2,926
2,671
Non - current
Secured bank loans
1,498
1,950
Total loans and borrowings
4,424
4,621
Current loans and borrowings
At 31 May 2021 current loans and borrowings of £2,926,000 (2020: £2,671,000) comprise short term loans of £2,562,000 and instalments due on long term loans detailed below of £364,000. The interest rate on the short-term loans range from 1.25% to 3% (2020: 1.25% to 3%) and these loans are secured on working capital of Hemmers and KMR. The short-term loans are drawn down by Hemmers against short-term borrowing facilities of up to a maximum of £10.3m (€11.5m) and by KMR against short-term borrowing facilities of £0.9m (€1m).
At 31 May 2021, the maximum limit available totalled £7m (€8.2m) of which £2.6m (€3m) has been utilised, therefore the headroom within the facility was £4.4m (€5.2m). Neither the Parent Company nor any of its subsidiaries other than Hemmers and KMR have borrowing facilities. The bank facilities are reviewed annually every May and are now in place for the forthcoming year.
Non-current loans and borrowings
A non-current loan was drawn down in 2007 from Kreissparkasse to finance the freehold extension of the warehouse in Nordhorn. In 2016 and 2017 further loans were drawn down to finance developments at Nordhorn.
The Group's loans and borrowings are within the accounts of Hemmers. They are denominated in Euros, and their principal terms are as follows:
Fixed
interest
rate
Repayment
profile
Final repayment date
31 May 2021
£000
31 May 2020
£000
Loan 1
4.07%
Equal monthly instalments
September 2027
353
436
Loan 2
1.65%
Equal quarterly instalments
September 2025
835
1,124
Loan 3
1.05%
Equal quarterly instalments
March 2026
310
390
Non-current loans
1,498
1,950
6. Other information
The financial information set out above does not constitute the company's statutory accounts for 2021 or 2020.
Statutory accounts for the years ended 31 May 2021 and 31 May 2020 have been reported on by BDO LLP, Statutory Auditor. The Independent Auditor's Report on the Annual Report and Financial Statements for both 2021 and 2020 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.
Statutory accounts for the year ended 31 May 2020 have been filed with the Registrar of Companies. The statutory accounts for the year ended 31 May 2021 will be delivered to the Registrar in due course. The Annual Report and Accounts giving notice of the 2021 Annual General Meeting, have been today published on the Group's website at www.leedsgroup.plc.uk. and have been sent to those shareholders who have elected to receive a hard copy of the Annual Report and Accounts by the post.
The Annual General Meeting will be held at 12 noon on 23 November 2021 at the Radisson Blu Hotel, Chicago Avenue, Manchester Airport, M30 3RA.
Note:
Certain statements made in this announcement are forward-looking statements. These forward-looking statements are not historical facts but rather are based on the Company's current expectations, estimates, and projections about its industry; its beliefs; and assumptions. Words such as 'anticipates,' 'expects,' 'intends,' 'plans,' 'believes,' 'seeks,' 'estimates,' and similar expressions are intended to identify forward-looking statements. These statements are not a guarantee of future performance and are subject to known and unknown risks, uncertainties, and other factors, some of which are beyond the Company's control, are difficult to predict, and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. The Company cautions security holders and prospective security holders not to place undue reliance on these forward-looking statements, which reflect the view of the Company only as of the date of this announcement. The forward-looking statements made in this announcement relate only to events as of the date on which the statements are made. The Company will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances, or unanticipated events occurring after the date of this announcement except as required by law or by any appropriate regulatory authority.
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