REG - Lok'nStore Group - Preliminary results for the year ended 31 July 16 <Origin Href="QuoteRef">LOK.L</Origin> - Part 2
17/10/2016 07:06
- Part 2: For the preceding part double click ID:nRSQ6186Ma
Directors and authorised for issue on 14 October 2016 and signed on its behalf by:
Andrew Jacobs Ray Davies
Chief Executive Officer Finance Director
Consolidated Statement of Comprehensive Income
For the year ended 31 July 2016
Notes 2016£'000 2015£'000
Revenue 1a 16,056 15,424
Total property, staff, distribution and general costs 2a (9,761) (9,742)
Adjusted EBITDA1 6,295 5,682
Amortisation of intangible assets (165) (165)
Depreciation and loss on sale (1,537) (1,440)
Equity settled share based payments (182) (211)
Irrecoverable property costs - (209)
Property disposal costs 2c (123) -
Net settlement proceeds 2c 1,940 -
(67) (2,025)
Operating profit1 6,228 3,657
Finance income 3 313 141
Finance cost 4 (1,048) (1,144)
Profit before taxation 5 5,493 2,654
Income tax expense 7 (1,211) (686)
Profit for the year 4,282 1,968
Profit attributable to:
Owners of the parent 22 4,282 1,968
Other Comprehensive Income
Items that will not be reclassified to profit and loss
Increase in property valuation 17,651 8,009
Deferred tax relating to change in property valuation (2,387) (1,578)
15,264 6,431
Items that may be subsequently reclassified to profit and loss
Increase / (decrease) in fair value of cash flow hedges 83 (170)
Deferred tax relating to cash flow hedges (21) 38
62 (132)
Other comprehensive income 15,326 6,299
Total comprehensive income for the year 19,608 8,267
Attributable to owners of the parent 19,608 8,267
Earnings per share
Basic 9 16.60p 7.84p
Diluted 9 16.24p 7.64p
1 Adjusted EBITDA and operating profit are defined in the accounting policies section of the notes to the financial
statements.
Consolidated Statement of Changes in Equity
For the year ended 31 July 2016
Sharecapital£'000 Sharepremium£'000 Otherreserves£'000 Revaluationreserve£'000 Retainedearnings£'000 Totalequity£'000
1 August 2014 279 1,801 8,595 26,478 8,057 45,210
Profit for the year - - - - 1,968 1,968
Other comprehensive income:
Increase in property valuation net of deferred tax - - - 6,431 - 6,431
Increase in fair value of cash flow hedges net of deferred tax - - (132) - - (132)
Total comprehensive income for the year - - (132) 6,431 1,968 8,267
Transactions with owners:
Dividend paid - - - - (1,847) (1,847)
Share based payments - - 211 - - 211
Transfers in relation to share based payments - - (298) - 298 -
Deferred tax credit relating to share options - - 309 - - 309
Exercise of share options 6 813 - - - 819
Total transactions with owners 6 813 222 - (1,549) (508)
Transfer realised gain on asset disposal - - - (421) 421 -
Transfer additional dep'n on revaluation net of deferred tax - - - (249) 249 -
31 July 2015 285 2,614 8,685 32,239 9,146 52,969
Profit for the year - - - - 4,282 4,282
Other comprehensive income:
Increase in property valuation net of deferred tax - - - 15,264 - 15,264
Decrease in fair value of cash flow hedges net of deferred tax - - 62 - - 62
Total comprehensive income for the year - - 62 15,264 4,282 19,608
Transactions with owners:
Dividend paid - - - - (2,147) (2,147)
Share based payments - - 182 - - 182
Transfers in relation to share based payments - - (401) - 401 -
Deferred tax credit relating to share options - - (96) - - (96)
Exercise of share options 6 953 - - - 959
Total transactions with owners 6 953 (315) - (1,746) (1,102)
Transfer realised gains on asset disposal - - - (1,639) 1,639 -
Transfer additional dep'n on revaluation net of deferred tax - - - (262) 262 -
31 July 2016 291 3,567 8,432 45,602 13,583 71,475
Company Statement of Changes in Equity
For the year ended 31 July 2016
Share capital£'000 Sharepremium£'000 Retainedreserves (deficit) £'000 Otherreserves£'000 Total£'000
31 July 2014 279 1,801 (167) 2,267 4,180
Loss for the year - - (139) - (139)
Equity settled share based payments - - - 211 211
Transfer in relation to share based payments - - 298 (298) -
Exercise of share options 6 813 - - 819
31 July 2015 285 2,614 (8) 2,180 5,071
Loss for the year - - (276) - (276)
Equity settled share based payments - - - 182 182
Transfer in relation to share based payments - - 401 (401) -
Exercise of share options 6 953 - - 959
31 July 2016 291 3,567 117 1,961 5,936
Consolidated Statements of Financial Position
31 July 2016 Company Registration No.
04007169
Notes Group2016£'000 Group2015£'000 Company2016£'000 Company2015£'000
Assets
Non-current assets
Intangible assets 10a 3,593 3,758 - -
Property, plant and equipment 10b 104,363 87,802 - -
Investments 11 - - 2,288 2,106
Development loan capital 12 3,159 2,779 - -
Amounts due from subsidiary undertakings 26 - - 3,648 2,965
111,115 94,339 5,936 5,071
Current assets
Inventories 13 165 141 - -
Trade and other receivables 14 4,952 2,479 - -
Cash and cash equivalents 16 5,335 2,435 - -
Total current assets 10,452 5,055 - -
Total assets 121,567 99,394 5,936 5,071
Liabilities
Current liabilities
Trade and other payables 15 (5,794) (5,971) - -
Current tax liabilities (173) (535) - -
Derivative financial instruments 17b (37) - - -
(6,004) (6,506) - -
Non-current liabilities
Borrowings 17a (28,727) (27,548) - -
Derivative financial instruments 17b - (119) - -
Deferred tax 18 (15,361) (12,252) - -
(44,088) (39,919) - -
Total liabilities (50,092) (46,425) - -
Net assets 71,475 52,969 5,936 5,071
Equity attributable to owners of the parent
Called up share capital 19 291 285 291 285
Share premium 3,567 2,614 3,567 2,614
Other reserves 21a 8,432 8,685 1,961 2,180
Retained earnings / (deficit) 22 13,583 9,146 117 (8)
Revaluation reserve 45,602 32,239 - -
Total equity attributable to owners of the parent 71,475 52,969 5,936 5,071
Approved by the Board of Directors and authorised for issue on 14 October 2016 and signed on its behalf by:
Andrew Jacobs Ray Davies
Chief Executive Officer Finance Director
Consolidated Statement of Cash Flows
For the year ended 31 July 2016
Notes 2016£'000 2015£'000
Operating activities
Cash generated from operations 24a 3,774 5,984
Income tax paid (961) (338)
Net cash generated from operations 2,813 5,646
Investing activities
Development loan capital (380) (2,650)
Purchase of property, plant and equipment (6,988) (3,583)
Proceeds from disposal of property, plant and equipment 8,399 2,901
Interest received 14 12
Net cash generated from investing activities 1,045 (3,320)
Financing activitiesProceeds from new borrowingsRepayment of borrowings 28,816(27,701) --
Finance costs paid (885) (1,041)
Equity dividends paid (2,147) (1,847)
Proceeds from issue of ordinary shares (net) 959 819
Net cash used in financing activities (958) (2,069)
Net increase in cash and cash equivalents in the year 2,900 257
Cash and cash equivalents at beginning of the year 2,435 2,178
Cash and cash equivalents at end of the year 5,335 2,435
No statement of cash flows is presented for the Company as it had no cash flows in either year.
Accounting Policies
General Information
Lok'nStore Group plc is an AIM listed company incorporated and domiciled in England and Wales. The address of the
registered office is One London Wall, London EC2Y 5AB, UK.
The preliminary financial information does not constitute full statutory accounts within the meaning of section 434 of the
Companies Act 2006 but is derived from statutory accounts for the years ended 31 July 2016 and 31 July 2015, both of which
are audited. The preliminary announcement is prepared on the same basis as set out in the statutory accounts for the year
ended 31 July 2016. While the financial information included in this preliminary announcement has been prepared in
accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRS), as adopted
by the European Union (EU), this announcement does not in itself contain sufficient information to comply with IFRSs.
The statutory accounts for the year ended 31 July 2016 will be delivered to the Registrar of Companies following the
Company's Annual General Meeting and can be obtained from the investor section of the Company's website at
http://www.loknstore.co.uk. Statutory accounts for the year ended 31 July 2015 have been filed with the Registrar of
Companies. The auditor's report for the year ended 31 July 2016 was unqualified, did not include a reference to any matter
to which the auditor drew attention by way of emphasis without qualifying their report and did not contain any statement
under section 498(2) or (3) of the Companies Act 2006.
Basis of accounting
The annual financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS)
and International Financial Reporting Interpretations Committee (IFRIC) Interpretations as adopted by the European Union
and comply with those parts of the Companies Act 2006 that are applicable to companies reporting under IFRS. The Group has
applied all accounting standards and interpretations issued by the International Accounting Standards Board and
International Financial Reporting Interpretation Committee relevant to its operations and effective for accounting periods
beginning on or after 1 August 2015.
The financial statements have been prepared on the historic cost basis except that certain trading properties and
derivative financial instruments are stated at fair value.
Adoption of new and revised standards
The following relevant new standards, interpretations and amendments have been adopted in the year but have no significant
impact.
IFRS 10: Consolidated Financial Statements
IFRS 11: Joint Arrangements
IFRS 12: Disclosure of Interest in Other Entities
Amendment to IAS 19: Employee Benefits
Amendment to IAS 27: Separate Financial Statements
Amendment to IAS 28: Investments in Associates and Joint Ventures
Amendment to IAS 32: Offsetting Financial Assets and Financial Liabilities
Amendment to IAS 36: Impairment of Assets
Amendment to IAS 39: Financial Instruments: Recognition and Measurement
Standards in issue but not yet effective
At the date of approval of these financial statements, the following principal standards and interpretations which were in
issue but not yet effective:
Standards, interpretations and amendmentsNot Yet Endorsed Effective date: Periods commencing on or after
IFRS 9 Financial Instruments 1 Jan 2018
IFRS10 andIAS 28 Sale or Contribution of Assets between an Investor and its Associate or Joint Venture 1 Jan 2016
IFRS11 Accounting for Acquisitions of Interests in Joint Operations 1 Jan 2016
IFRS15 Revenue from Contracts with Customers 1 Jan 2018
IAS 16 and IAS 38 Clarification of Acceptable Methods of Depreciation and Amortisation 1 Jan 2016
IAS 27 Equity Method in Separate Financial Statements 1 Jan 2016
IAS 1 Disclosure Initiative 1 Jan 2016
IFRS 16 Leases 1 Jan 2019
Subject to the adoption in due course of IFRS 16, The directors do not anticipate that the adoption of these Standards will
have a significant impact on the financial statements of the Group. With regard to IFRS 16, the Directors are currently
assessing the impact on the financial statements.
There were no other Standards or Interpretations, which were in issue but not yet effective at the date of authorisation of
these financial statements, that the Directors anticipate will have a material impact on the financial statements of the
Group.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the
Company (its subsidiaries) made up to 31 July each year. Control is achieved where the Company has power over the investee,
exposure or rights to variable returns from the investee and the ability to use its power to vary those returns.
Intra-group transactions, balances, and unrealised gains and losses on transactions between Group companies are eliminated
on consolidation, except to the extent that intra-group losses indicate an impairment.
Going concern
The Directors can report that, based on the Group's budgets and financial projections, they have satisfied themselves that
the business is a going concern. The Board has a reasonable expectation that the Company and the Group have adequate
resources and facilities to continue in operational existence for the foreseeable future based on Group cash balances and
cash equivalents of £5.3 million (2015: £2.4 million), undrawn committed bank facilities at 31 July 2016 of £11.2 million
(2015: £12.3 million), and cash generated from operations in the year to 31 July 2016 of £3.8 million (2015: £6.0
million).
Following the agreement of new facilities with Royal Bank of Scotland on improved terms, the Group now operates a five year
£40 million revolving credit facility with RBS plc. The facility has been in place since 15 January 2016 and runs until 14
January 2021. The Group is fully compliant with all bank covenants and undertakings and is not obliged to make any
repayments prior to expiration. The financial statements are therefore prepared on a going concern basis.
Critical accounting estimates and judgements
The preparation of consolidated financial statements under EU-IFRS requires management to make estimates and assumptions
that may affect the application of accounting policies and the reported amounts of assets and liabilities, income and
expenses. Actual outcomes may differ from these estimates and assumptions. The estimates and assumptions that have a
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next
financial year are discussed below.
a) Estimate of fair value of trading properties
The Group values its self storage stores using a discounted cash flow methodology which is based on current and projected
net operating income. Principal assumptions underlying management's estimation of the fair value are those relating to
stabilised occupancy levels; expected future growth in storage rents and operating costs, maintenance requirements,
capitalisation rates and discount rates. A more detailed explanation of the background and methodology adopted in the
valuation of the Group's trading properties is set out in note 10b. The carrying value of land and buildings held at
valuation at the reporting date was £81 million (2015: £61.0 million) as shown in the table in note 10b.
b) Assets in the course of construction and land held for pipeline store development ('Development property assets')
The Group's development property assets are held in the statement of financial position at historic cost and are not valued
externally. In acquiring sites for redevelopment into self-storage facilities, the Group estimates and makes judgements on
the potential net lettable storage space that it can achieve in its planning negotiations, together with the time it will
take to achieve maturity occupancy level. In addition, assumptions are made on the storage rent that can be achieved at the
store by comparison with other stores within the portfolio and within the local area. These judgements, taken together with
estimates of operating costs and the projected construction cost, allow the Group to calculate the potential net operating
income at maturity, projected returns on capital invested and hence to support the purchase price of the site at
acquisition. Following the acquisition, regular reviews are carried out taking into account the status of the planning
negotiations, and revised construction costs or capacity of the new facility, for example, to make an assessment of the
recoverable amount of the development property. The Group reviews all development property assets for impairment at each
reporting date in the light of the results of these reviews. Once a store is opened, it is valued as a trading store.
The carrying value of development property assets at the reporting date was £0.5 million (2015: £8.9 million). Please see
note 10b for more details.
c) Estimate of fair value of intangible assets acquired in business combination
The relative size of the Group's intangible assets, excluding goodwill, makes the judgements surrounding the estimated
useful lives important to the Group's financial position and performance. At 31 July 2016 intangible assets, excluding
goodwill, amounted to £2.48 million (2015: £2.65 million). The valuation method used and key assumptions are described in
note 10a.
The useful life used to amortise intangible assets relates to the expected future performance of the assets acquired and
management's judgement of the period over which economic benefit will be derived from the asset. The estimated useful life
of customer relationships principally reflects management's view of the average economic life of the customer base and is
assessed by reference to customer churn rates. Typically, the customer base for a serviced archive business is relatively
inert. Corporate customers do not tend to switch service providers and indeed they incur box withdrawal charges should they
do so. An increase in churn rates may lead to a reduction in the estimated useful life and an increase in the amortisation
charge.
Notes to the Financial Statements
For the year ended 31 July 2016
1a Revenue
Analysis of the Group's revenue is shown below:
2016 2015
Stores trading £'000 £'000
Self-storage revenue 11,931 11,851
Other storage related revenue 1,510 1,434
Ancillary store rental revenue 3 7
Management fees 439 176
Sub-total 13,883 13,468
Document storage revenue 2,173 1,956
Total revenue per statement of comprehensive income 16,056 15,424
1b Segmental information
IFRS 8 Operating Segments requires operating segments to be identified on the basis of internal reports about components of
the Group that are regularly reviewed by the Board to allocate resources to the segments and to assess their performance.
All of the Group's activities occur in the United Kingdom.
Financial information is reported to the Board with revenue and profit analysed between self-storage activity and serviced
document storage activity.
Segment revenue comprises of sales to external customers and excludes gains arising on the disposal of assets and finance
income. Segment profit reported to the Board represents the profit earned by each segment before acquisition costs and
other non-recurring set-up costs, finance income, finance costs and tax. For the purposes of assessing segment performance
and for determining the allocation of resources between segments, the Board uses a measure of adjusted EBITDA (as defined
in the accounting policies) and reviews the non-current assets attributable to each segment as well as the financial
resources available. All assets are allocated to reportable segments. Assets that are used jointly by segments are
allocated to the individual segments on a basis of revenues earned. All liabilities are allocated to individual segments
other than borrowings and tax. Information is reported to the Board of Directors on a product basis as management believe
that the activity of self-storage and the activity of serviced document storage expose the Group to differing levels of
risk and rewards due to the length, nature, seasonality and customer base of their respective operating cycles.
The segment information for the year ended 31 July 2016 is as follows:
Self-storage 2016£'000 Serviced archive & records management2016£'000 Total2016£'000
Revenue from external customers 13,883 2,173 16,056
Adjusted EBITDA 5,708 587 6,295
Management charges 72 (72) -
Segment Adjusted EBITDA 5,780 515 6,295
DepreciationAmortisation of intangible assets (1,436) - (101) (165) (1,537) (165)
Equity settled share based payments (182) - (182)
Net settlement proceeds - Reading site 1,940 - 1,940
Disposal costs - Swindon store(s) (123) - (123)
Segment profit 5,979 249 6,228
Central costs not allocated to segments:
Finance income 313
Finance costs (1,048)
Profit before taxation 5,493
Income tax expense (1,211)
Consolidated profit for the financial year 4,282
The segment information for the year ended 31 July 2015 is as follows:
Self-storage 2015£'000 Serviced archive & records management2015£'000 Total2015£'000
Revenue from external customers 13,468 1,956 15,424
Adjusted EBITDA 5,420 262 5,682
Management charges 25 (25) -
Segment Adjusted EBITDA 5,445 237 5,682
DepreciationAmortisation of intangible assets (1,340) - (100) (165) (1,440) (165)
Equity settled share based payments (211) - (211)
Irrecoverable property costs (209) - (209)
Segment profit/(loss) 3,685 (28) 3,657
Central costs not allocated to segments:
Finance income 141
Finance costs (1,144)
Profit before taxation 2,654
Income tax expense (686)
Consolidated profit for the financial year 1,968
Corporate transactions and the treasury function are managed centrally and therefore are not allocated to segments. Sales
between segments are carried out at arm's length. The serviced archive segment with over 430 customers has a greater
customer concentration with its ten largest corporate customers accounting for 34.6% (2015: 34.6%) of revenue, its top 50
customers accounting for 61.7% (2015: 63.3%) and its top 100 customers accounting for 77.0 % (2015: 79.9%) of revenue. The
self-storage segment with over 9,200 customers has no individual self-storage customer accounting for more than 1% of total
revenue and no group of entities under common control (e.g. Government) accounts for more than 10% of total revenues.
Self-storage2016£'000 Serviced archive &records management2016£'000 Total2016£'000
Segment assets 114,334 6,314 120,648
Segment liabilities (19,807) (601) (20,408)
Borrowings (28,727)
Derivative financial instruments not allocated to segments (37)
Total liabilities (49,172)
Capital expenditure (note 10b). 6,629 359 6,988
Self-storage2015£'000 Serviced archive &records management2015£'000 Total2015£'000
Segment assets 93,296 6,098 99,394
Segment liabilities (18,222) (536) (18,758)
Borrowings (27,548)
Derivative financial instruments not allocated to segments (119)
Total liabilities (46,425)
Capital expenditure (note 10b). 3,126 457 3,583
The amounts presented to the Board with respect to total assets and total liabilities are measured in a manner consistent
with the financial statements and are allocated based on the operations of the segment. Borrowings are managed centrally on
a Group basis and are therefore not allocated to segments.
2a Property, staff, distribution and general costs
2016£'000 2015£'000
Property and premises costs 3,913 4,010
Staff costs 4,232 4,188
General overheads 1,128 1,049
Distribution costs 170 190
Retail products cost of sales (see note 2b) 318 305
9,761 9,742
2b Cost of sales of retail products
Cost of sales represents the direct costs associated with the sale of retail products (boxes, packaging etc.), and the
ancillary sales of insurance cover for customer goods, all of which fall within the Group's ordinary activities.
2016£'000 2015£'000
Retail 118 130
Insurance 51 33
Other 2 2
171 165
Serviced archive consumables and direct costs 147 140
318 305
2c Other Income and costs
2016£'000 2015£'000
Property disposal costs1 123 -
Net settlement proceeds2 (1,940) -
Irrecoverable property costs3 - 209
(1,817) 209
1 Property disposal costs relate to the sale and manage back of the Swindon store.
2 Net settlement proceeds relate to an additional £2 million received for sale of old Reading store net of costs.
3 Irrecoverable property costs relate to site demolition costs not recoverable from the prospective purchaser of the
Portsmouth North site.
3 Finance income
2016£'000 2015 £'000
Bank interest 14 12
Other interest 299 129
313 141
Interest receivable arises on cash and cash equivalents (see note 16) and on development loan capital deployed.
4 Finance costs
2016£'000 2015£'000
Bank interest 797 925
Non-utilisation fees and amortisation of bank loan arrangement fees 251 219
1,048 1,144
5 Profit before taxation
2016£'000 2015£'000
Profit before taxation is stated after charging:
Depreciation and amounts written off property, plant and equipment:
Owned assets 1,535 1,440
Amortisation of intangible assets 165 165
Operating lease rentals - land and buildings 1,529 1,562
Amounts payable to RSM UK Audit LLP (formerly Baker Tilly UK Audit LLP) and their associates for audit and non-audit
services:
Audit services
- UK statutory audit of the Company and consolidated accounts 48 45
Other services
-the auditing of accounts of associates of the Company pursuant to legislation 14 14
Other services supplied pursuant to such legislation
- interim review 7 7
Tax services
- compliance services 26 26
- advisory services 2 13
97 105
Comprising:
Audit services 62 59
Non-audit services 35 46
97 105
6 Employees
2016No. 2015No.
The average monthly number of persons (including Directors) employed by the Group during the year was:
Store management 121 113
Administration 29 30
150 143
2016£'000 2015£'000
Costs for the above persons:
Wages and salaries 3,425 3,451
Social security costs 532 443
Pension costs 92 87
4,049 3,981
Share based remuneration (options) 182 211
4,231 4,192
Share based remuneration is separately disclosed in the statement of comprehensive income. Wages and salaries of £133,669
(2015: £132,543) have been capitalised as additions to property, plant and equipment as they are directly attributable to
the acquisition of these assets. All other employee costs are included in staff costs in the statement of comprehensive
income.
In relation to pension contributions, there was £11,705 (2015: £9,260) outstanding at the year-end.
Directors' remuneration
2016 Emoluments£ Bonuses£ Benefits£ Sub total£ Gains onshare options£ Total£
Executive:
A Jacobs 208,080 24,000 3,460 235,540 408,600 644,140
SG Thomas 52,020 - 3,315 55,335 132,146 187,481
RA Davies 116,750 12,000 3,492 132,242 409,245 541,487
CM JacobsN Newman * 59,02142,556 14,00021,154 2,7111,299 75,73265,009 43,601- 119,33365,009
Non-Executive:
RJ Holmes 20,808 - - 20,808 - 20,808
ETD Luker 26,010 - - 26,010 - 26,010
CP Peal 20,808 - - 20,808 22,900 43,708
546,053 71,154 14,277 631,484 1,016,492 1,647,976
*Appointed 26 November 2015
2015 Emoluments£ Bonuses£ Benefits£ Sub total£ Gains onshare options£ Total£
Executive:
A Jacobs 204,000 38,000 4,055 246,055 156,399 402,454
SG Thomas 51,000 9,500 3,724 64,224 50,399 115,199
RA Davies 110,000 15,500 3,063 128,563 55,437 184,000
CM Jacobs 57,834 6,500 3,177 67,511 152,865 220,376
Non-Executive:
RJ Holmes 20,033 - - 20,033 - 20,033
ETD Luker 25,500 - - 25,500 - 25,500
CP Peal 20,400 - - 20,400 - 20,400
488,767 69,500 14,019 572,286 415,676 987,962
Pension contributions of £30,775 (2015: £30,475) were paid by the Group on behalf of R A Davies and are not included in the
Directors' emoluments table above. The highest paid Director did not accrue any pension rights during the year. The
benefits in kind all relate to medical insurance premiums paid on behalf of the Directors. The number of Directors to whom
retirement benefits are accruing under money purchase pension schemes in respect of qualifying service is one (2015: one).
7 Taxation
2016£'000 2015£'000
Current tax:
UK corporation tax at 20% (2015: 20.7%) 606 535
Deferred tax:
Origination and reversal of temporary differences 976 100
Adjustments in respect of prior periods 75 51
Impact of change in tax rate on closing balance (446) -
Total deferred tax 605 151
Income tax expense for the year 1,211 686
The charge for the year can be reconciled to the profit for the year as follows:
2016£'000 2015£'000
Profit before tax 5,493 2,654
Tax on ordinary activities at the effective standard rate of corporation tax in the UK of 20% (2015: 20.7%) 1,099 549
Expenses not deductible for tax purposes 3 2
Depreciation of non-qualifying assets 85 85
Share based payment charges in excess of corresponding tax deduction 36 -
Impact of change in tax rate on closing deferred tax balance (69) -
Adjustments in respect of prior periods - deferred taxOther 754 51(1)
Share option scheme (22) -
Income tax expense for the year 1,211 686
Effective tax rate 22% 26%
The UK's main rate of corporation tax and the applicable rate for this period is 20.0%. In addition to the amount charged
to profit or loss for the year, deferred tax relating to the revaluation of the Group's properties of £2,387,114 (2015:
£1,577,896) and the movement in the fair value of cash flow hedges of (£20,834) (2015: (£37,549)) has been recognised as a
debit/credit directly in other comprehensive income (see note 18 on deferred tax).
8 Dividends
2016£'000 2015£'000
Amounts recognised as distributions to equity holders in the year:
Final dividend for the year ended 31 July 2014 (5.0 pence per share) - 1,258
Interim dividend for the six months to 31 January 2015 (2.33 pence per share) - 589
Final dividend for the year ended 31 July 2015 (5.67 pence per share)Interim dividend for the six months to 31 January 2016 (2.67 pence per share) 1,456691 --
2,147 1,847
In respect of the current year the Directors propose that a final dividend of 6.33 pence per share will be paid to the
shareholders. The total estimated dividend to be paid is £1,689,379 based on the number of shares in issue at 3 October
2016 as adjusted for shares held in the Employee Benefits Trust and for shares held on treasury. This is subject to
approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial
statements. The ex-dividend date will be 17 November 2016; the record date 18 November 2016; with an intended payment date
of 19 December 2016.
9 Earnings per share
The calculations of earnings per share are based on the following profits and numbers of shares.
2016£'000 2015 £'000
Profit for the financial year attributable to owners of the parent 4,282 1,968
2016No. of shares 2015No. of shares
Weighted average number of shares
For basic earnings per share 25,791,821 25,102,032
Dilutive effect of share options1 577,822 654,598
For diluted earnings per share 26,369,643 25,756,630
1 Further options that could potentially dilute EPS in the future are excluded from the above because they are not dilutive
in the period presented. Full details of share options are included in notes 20 to 23
623,212 (2015: 623,212) shares held in the Employee Benefit Trust and 2,466,869 (2015: 2,466,869) Treasury shares are
excluded from the above (see note 26).
2016 2015
Earnings per share
Basic 16.60p 7.84p
Diluted 16.24p 7.64p
10a Intangible assets
Group Goodwill£'000 Contractualcustomerrelationships £'000 Total£'000
Cost at 1 August 2014 1,110 3,309 4,419
Amortisation at 1 August 2014 - (496) (496)
Amortisation charge - (165) (165)
Amortisation at 31 July 2015 - (661) (661)
Net book value at 31 July 2015 1,110 2,648 3,758
Cost at 1 August 2015 1,110 3,309 4,419
Amortisation at 1 August 2015 - (661) (661)
Amortisation charge - (165) (165)
Amortisation at 31 July 2016 - (826) (826)
Net book value at 31 July 2016 1,110 2,483 3,593
All goodwill and customer relationships are allocated to the serviced document storage cash-generating unit (CGU)
- More to follow, for following part double click ID:nRSQ6186McRecent news on Lok'n Store
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