REG - Norman Broadbent PLC - Final 2021 Results and Notice of AGM
25/05/2022 08:31
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RNS Number : 6832M Norman Broadbent PLC 25 May 2022
Norman Broadbent plc
("Norman Broadbent", the "Company" or the "Group")
Final 2021 Results and Notice of AGM
The board (the "Board") of Norman Broadbent (AIM: NBB), a leading London
quoted Executive Search and Interim Management firm offering a diversified
portfolio of integrated Leadership Acquisition & Advisory Services, is
pleased to announce its final results and annual accounts for the year ended
31 December 2021.
Highlights
· Significant change in Leadership as part of a larger restructuring
exercise
· Positive full year 2021 EBITDA before restructuring costs
· Return to growth in Q4 2021 with 20% year on year improvement in Net
Fee Income for the quarter and a 38% increase on the Q1 to Q3 average
· Solid momentum into 2022 with a 50% increase in fee earning talent
(Jan to April) and 20% year on year increase in Search NFI (Jan to April)
A copy of the audited 2021 Annual Report (including the notice of Annual
General Meeting ("AGM")) will be sent to shareholders today. The Annual Report
will be available on the Company's website in due course,
https://www.normanbroadbent.com/investor-relations
The Company's AGM will be held at 10am at Millbank Tower, 21-24 Millbank,
London SW1P 4QP (and by Zoom conference software meeting) on 23rd June 2022.
Kevin Davidson, Group CEO of Norman Broadbent plc said:
"While 2021 was a challenging year for Norman Broadbent, the appointment of a
new Chair in July, my appointment as CEO in September and Sean Buchan as Group
Managing Director in November has put the business on a very different and a
much more positive trajectory. The new management team has implemented a new
strategic plan, focussed on accelerated, sustainable and profitable growth
through acquisition and development of quality fee earning talent in the UK
and internationally, combined with greater concentration on high margin Board
and Executive Search business and a continually expanding Interim contractor
book.
We delivered a very robust Q4 whilst greatly strengthening leadership and
fashioning the changes needed to bring Norman Broadbent back to a leading
position in executive search and interim management in the UK and
internationally. Great strides have been made and we are excited about the
future at a resurgent Norman Broadbent.
2022 hiring and growth strategy is in execution phase and in 2022, to date the
number of fee earners has increased by 50% with considerable further
opportunities for growth identified. We have seen the momentum from Q4
continue into 2022.
The Board and I would like to thank the entire team for their dedication, our
shareholders for their continuing support, and our clients for placing their
trust in us. We look forward to the future together."
For further information, please contact:
Norman Broadbent plc 020 7484 0000
Kevin Davidson / Peter Searle / Steve Smith
WH Ireland Limited 020 7220 1666
Jessica Cave / Darshan Patel
This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.
Chairman's Statement
Since my appointment in July 2021 the business has undergone significant and
very positive change, setting it on the path to profitable growth.
Following the arrival of the new CEO (Kevin Davidson) in September 2021, a new
Leadership team has been appointed and already delivered very positive results
in their first few months in terms of culture, headcount, vision and financial
performance.
A culture of genuine inclusion and an unwavering commitment to customer
service and delivery has been installed. The customer facing team has been
significantly enhanced by a number of experienced new hires and the research
foundations of the business are developing and expanding to keep pace.
I am extremely pleased with the ongoing performance of the new team and their
actions to date. There is a palpable shift in energy and optimism across the
business and the future is exciting.
As the board's strategy for sustained profitable growth unfolds over the
coming year we should see this translate quickly to the bottom line.
Peter Searle
Chair Norman Broadbent plc
24th May 2022
CEO's Review
RESULTS FOR THE FINANCIAL YEAR
The table below summarises the results of the Group:
Year ended Year ended
31-Dec 31-Dec
2021 2020
£000's £000's
CONTINUING OPERATIONS
REVENUE 6,549 7,816
Cost of sales (690) (1,530)
NET FEE INCOME (GROSS PROFIT) 5,859 6,286
Operating expenses (5,854) (6,217)
ADJUSTED EBITDA PRE RESTRUCTURING COSTS 5 69
Restructuring costs (308) -
EBITDA (303) 69
Depreciation and amortisation (229) (222)
GROUP OPERATING PROFIT / (LOSS) (532) (153)
Net finance cost (41) (40)
PROFIT / (LOSS) BEFORE TAX (573) (193)
Income tax (69) -
PROFIT / (LOSS) AFTER TAX (642) (193)
Strategic review
Since my appointment in September 2021, we have achieved a great deal.
Following a very difficult period for Norman Broadbent Group, we stabilised
the business, delivered a very strong Q4 (£1.8m NFI; a 20% improvement on
prior year Q4 (£1.5m) and 38% increase on Q1 to Q3 2021 (average of £1.3m)
whilst also beginning the process of reshaping culture, considerably
strengthening leadership capability and starting to rebuild across functions
and service lines.
There has been unwavering commitment from across the team to this process and
I would like to acknowledge all of their efforts and support. There is a very
high level of engagement and growing momentum within the business which is
generating better outcomes for clients, higher net fee income per individual
whilst also enhancing our employer brand proposition through a more cohesive,
dynamic and energised culture.
Our growth agenda has now very much kicked into gear and we are working on our
longer term strategic plan which will involve domestic and international
expansion in 2022 and considerable headcount growth across executive search
and senior interim leadership as well as the other research and support
functions. Since my taking up position in September, we have already made 15
very high calibre appointments.
We target a return to sustainable profitability in 2022 whilst also building
the foundations for rapidly accelerated performance improvements in 2023 and
beyond.
Purpose, Vision and Values
Following an in-depth process of engagement across the entire business, the
team arrived at a refreshed purpose, vision and set of values which will shape
the Norman Broadbent culture in the future. We are proud of these and they
provide a framework within which we all operate and hold ourselves and one
another accountable.
Purpose: To have a lasting positive impact on
people's lives and the organisations we support
Vision: To be the international brand of
choice as an employer and business partner across board, executive and interim
leadership solutions through our passionate, collaborative and
delivery-focussed culture
Values / Pledge:
We Promote a Culture of Excellence
· everything we do is underpinned by a commitment to excellence, built
on a culture of high performance, continual improvement and values-driven
leadership
We Embody Genuine Curiosity
· curiosity is the 'engine of our success,' allowing us to form
meaningful relationships, understand complex challenges and create exceptional
outcomes
We Champion Collective Success
· we support and challenge one another to deliver and celebrate success
in an inclusive environment
We Care
· about ourselves, each other, our clients, our communities and the
world in which we live in
2021 trading and business review
2021 saw a significant restructure to the business. As a result, Group
turnover reduced to £6,549,000 (2020: £7,816,000) whilst overall net
revenues after associate and interim costs in the continuing businesses
reduced to £5,859,000 (2020: £6,286,000). Although we continued to invest in
talent, a focus on cost management ensured that operating expenses reduced
significantly to £5,854,000 (2020: £6,217,000). The business incurred
restructuring costs of £308,000 associated with the exit of members of the
former Executive and Leadership Consulting team. Adjusted EBITDA pre these
restructuring costs has reduced from £69,000 in 2020 to £5,000 in 2021.
Financial position
As at 31 December 2021, consolidated net assets were £836,000 (2019:
£1,106,000) with net current liabilities of (£505,000) (2020: Net Current
Liabilities of (£504,000)). Group cash amounted to £459,000 (2020:
£367,000).
Net cash outflow from operations in 2021 was £446,000 (2020 inflow:
£515,000). Net cash inflow from financing activities amounted to £607,000
(2020: outflow £492,000) which includes £372,000 relating to a successful
subscription equity raise that was supported by the Group's existing
shareholders.
At 31 December 2021 the Group had £952,000 (2020: £577,000) of funds drawn
down against the revolving invoice discounting facility against UK trade
receivables of £1,732,000 (2020: £1,449,000).
The Directors continue to monitor and manage the Group's working capital
carefully.
Arrangements for AGM
The AGM will take place on June 23rd(,) 2022 at 10 AM. Shareholders are
invited to attend in person at our Register Office or via Zoom conferencing
software. Shareholders attending via Zoom who wish to vote on the AGM's
resolutions will need to do so by proxy. Full details on how to gain access to
the meeting and vote by proxy are provided in the notes to the notice of AGM
set out on page 54.
Summary
2021 was another challenging year for Norman Broadbent. However, since the
appointment of a new Chair in July and my appointment as CEO in September, the
business is on a very different and much more positive trajectory.
We delivered a very robust Q4 whilst greatly strengthening leadership and
fashioning the changes needed to bring Norman Broadbent back to a leading
position in executive search and interim management in the UK and
internationally. Great strides have been made and we are excited about the
future at a resurgent Norman Broadbent.
The Board and I would like to thank the entire team for their dedication, our
shareholders for their continuing support, and our clients for placing their
trust in us. We look forward to the future together.
Kevin Davidson
Group Chief Executive
24th May 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2021
2021 2020
Note £'000 £'000
CONTINUING OPERATIONS
Revenue 1 6,549 7,816
Cost of sales (690) (1,530)
Gross profit 3 5,859 6,286
Operating expenses (6,391) (6,439)
Operating profit /(loss) from continued operations (532) (153)
Net finance cost 7 (41) (40)
PROFIT / (LOSS) ON ORDINARY ACTIVITIES BEFORE INCOME TAX 4 (573) (193)
Income tax expense 6 (69) -
PROFIT / (LOSS) FROM CONTINUING OPERATIONS (642) (193)
PROFIT / (LOSS) FOR THE PERIOD (642) (193)
TOTAL COMPREHENSIVE INCOME / (LOSS) FOR THE YEAR (642) (193)
Profit / (loss) attributable to:
- Owners of the Company (642) (322)
- Non-controlling interests - 129
Profit / (loss) for the year (642) (193)
Total comprehensive income / (loss) attributable to:
- Owners of the Company (642) (322)
- Non-controlling interests - 129
Total comprehensive income / (loss) for the year (642) (193)
Profit / (loss) per share
- Basic 8 (1.14)p (0.59)p
- Diluted (1.14)p (0.59)p
Adjusted profit / (loss) per share
- Basic 8 (1.14)p (0.59)p
- Diluted (1.14)p (0.59)p
profit / (loss) per share - continuing operations
- Basic 8 (1.14)p (0.59)p
- Diluted (1.14)p (0.59)p
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2021
2021 2020
Notes £'000 £'000
Non-Current Assets
Intangible assets 10 1,363 1,363
Property, plant and equipment 11 526 332
Prepayments and accrued income 13 - 145
Deferred tax assets 6 - 69
TOTAL NON-CURRENT ASSETS 1,889 1,909
Current Assets
Trade and other receivables 13 1,915 1,547
Cash and cash equivalents 14 459 367
TOTAL CURRENT ASSETS 2,374 1,914
TOTAL ASSETS 4,263 3,823
Current Liabilities
Trade and other payables 15 1,727 1,645
Bank overdraft and interest bearing loans 16 952 577
Provisions 21 -- -
Lease Liabilities 20 200 196
TOTAL CURRENT LIABILITIES 2,879 2,418
(505) (504)
NET CURRENT LIABILITIES
Non-Current Liabilities 16 250 250
Bank Loans
Lease Liabilities 20 298 49
TOTAL NON-CURRENT LIABILITIES 548 299
TOTAL LIABILITIES 3,427 2,717
836 1,106
TOTAL ASSETS LESS TOTAL LIABILITIES
EQUITY
Issued share capital 18 6,334 6,279
Share premium account 18 14,080 13,763
Retained earnings (19,578) (18,936)
836 1,106
EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY
Non-controlling interests - -
TOTAL EQUITY 836 1,106
These financial statements were approved by the Board of Directors on 21(st)
May, 2022
Signed on behalf of the Board of Directors
K
Davidson
S Smith
Director
Director
Company No 00318267
COMPANY STATEMENT OF FINANCIAL POSITION
As at 31 December 2021
Notes 2021 2020
£'000 £'000
Non-Current Assets
Investments 12 1,200 1,686
Prepayments and accrued income 13 - 66
TOTAL NON-CURRENT ASSETS 1,200 1,752
Current Assets
Trade and other receivables 13 1,385 5,383
Cash and cash equivalents 14 170 12
TOTAL CURRENT ASSETS 1,555 5,395
TOTAL ASSETS 2,755 7,147
Current Liabilities
Trade and other payables 15 1,248 1,605
TOTAL CURRENT LIABILITIES 1,248 1,605
NET CURRENT ASSETS 307 3,790
Non Current Liabilities
Bank Loans 16 250 250
TOTAL NON-CURRENT LIABILITIES 250 250
TOTAL LIABILITIES 1,498 1,855
TOTAL ASSETS LESS TOTAL LIABILITIES 1,257 5,292
EQUITY
Issued share capital 18 6,334 6,279
Share premium account 18 14,080 13,763
Retained earnings (19,157) (14,750)
TOTAL EQUITY 1,257 5,292
These financial statements were approved by the Board of Directors on 21(st)
May, 2022
Signed on behalf of the Board of Directors
K Davidson S Smith
Director
Director
Company No 00318267
` CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
CONSOLIDATED GROUP
Attributable to owners of the Company
Share Capital Share Premium Retained Earnings Total Equity Non-controlling interests Total Equity
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2020 6,266 13,706 (18,632) 1,340 25 1,365
Loss for the year (322) (322) 129 (193)
Total comprehensive income for the year (322) (322) 129 (193)
Credit to equity for share based payments 3 3 3
Issue of ordinary shares 13 57 - 70 - 70
Total transactions with owners of the Company, recognised directly in equity 13 57 3 73 - 73
Purchase of non-controlling interests - - 15 15 (154) (139)
Total transactions with owners of the Company 13 57 18 88 (154) (66)
Balance at 31 December 2020 6,279 13,763 (18,936) 1,106 - 1,106
Balance at 1 January 2021 6,279 13,763 (18,936) 1,106 - 1,106
Loss for the year - - (642) (642) - (642)
Total comprehensive income for the year (642) (642) - (642)
Transactions with owners of the Company, recognised directly in equity:
Issue of ordinary shares 55 317 - 372 - 372
Total transactions with owners of the Company 55 317 - 372 - 372
- - - - - -
Purchase of non-controlling interests
Total transactions with owners of the company 55 317 - 372 - 372
Balance at 31 December 2021 6,334 14,080 (19,578) 836 - 836
Share Capital
This represents the nominal value of shares that have been issued by the
Company.
Share Premium
This reserve records the amount above the nominal value received for shares
issued by the Company. Share premium may only be utilised to write off any
expenses incurred or commissions paid on the issue of those shares, or to pay
up new shares to be allotted to members as fully paid bonus shares.
Retained Earnings
This reserve comprises all current and prior period retained profits and
losses after deducting any distributions made to the Company's shareholders.
COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
Attributable to owners of the Company
Share Share Retained Earnings Total Equity
Capital
Premium
COMPANY £'000 £'000 £'000 £'000
Balance at 1 January 2020 6,266 13,706 (14,624) 5,348
Loss for the year - - (129) (129)
Total comprehensive income for the year - - (129) (129)
Transactions with owners of the Company, recognised directly in equity:
Credit to equity for share based payments 3 3
Issue of ordinary shares 13 57 - 70
Balance at 31 December 2020 6,279 13,763 (14,750) 5,292
Balance at 1 January 2021
Loss for the year (4,407) (4,407)
Total comprehensive income for the year (4,407) (4,407)
Transactions with owners of the Company, recognised directly in equity:
Credit to equity for share based payments - - - -
Issue of ordinary shares 55 317 - 372
Balance at 31 December 2021 6,334 14,080 (19,157) 1,257
Share Capital
This represents the nominal value of shares that have been issued by the
Company.
Share Premium
This reserve records the amount above the nominal value received for shares
issued by the Company. Share premium may only be utilised to write off any
expenses incurred, or commissions paid on the issue of those shares, or to pay
up new shares to be allotted to members as fully paid bonus shares.
Retained Earnings
This reserve comprises all current and prior period retained profits and
losses after deducting any distributions made to the Company's shareholders.
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2021
2021 2020
Notes £'000 £'000
Net cash inflow/(used) in operating activities (i) (446) 515
Cash flows from investing activities and servicing of finance
Net finance cost (14) (23)
Payments to acquire tangible fixed assets 11 (55) (65)
Net cash used in investing activities (69) (88)
Cash flows from financing activities
Repayment of borrowings 16 - (119)
New Loans received - 250
Payment of finance lease liabilities (140) (180)
Proceeds from issue of share capital 18 372 (70)
Increase/(Decreased) invoice discounting 16 375 (373)
Net cash from financing activities 607 (492)
Net increase/(decrease) in cash and cash equivalents 92 (65)
Net cash and cash equivalents at beginning of period 367 432
Effects of exchange rate changes on cash balances held in foreign currencies - -
Net cash and cash equivalents at end of period 459 367
Analysis of net funds
Cash and cash equivalents 459 367
Borrowings due within one year (952) (577)
Borrowings due within more than one year (250) (250)
Net debt (ii) (743) (460)
Note(i)
Reconciliation of operating profit / (loss) to net cash from operating
activities
2021 2020
£'000 £'000
Operating profit /(loss) from continued operations (532) (153)
Depreciation/impairment of property, plant and equipment 227 222
Share based payment charge - 7
Fixed Asset Write Off - 3
Decrease/(Increase) in trade and other receivables (223) 1,321
(Decrease)/Increase in trade and other payables 82 (670)
Decrease in Provisions - (215)
Taxation paid - -
Net cash generated from operating activities (446) 515
Note (ii)
Reconciliation of movement of debt
2021 2020
£'000 £'000
Net increase/(decrease) in cash and cash equivalents 92 (65)
New Borrowings - (250)
Repayment of Borrowings - 119
Decrease/(Increase) invoice discounting (375) 373
Exchange difference on cash and cash equivalents - -
Movement in Borrowings for the Period (283) 177
Net Borrowings at the Start of the Period (460) (637)
Net Borrowings at the end of the Period (743) (460)
COMPANY STATEMENT OF CASH FLOWS
For the year ended 31 December 2021
2021 2020
Notes £'000 £'000
Net cash used in operating activities (i) (214) (151)
Cash flows from investing activities and servicing of finance
Interest paid - (8)
Disposal of Investments - (44)
Net cash used in investing activities - (52)
Cash flows from financing activities
Proceeds/(Repayment) of borrowings 16 - (119)
New Loans - 250
Net cash inflows from equity placing 18 372 70
Net cash from financing activities 372 201
Net (decrease) in cash and cash equivalents 158 (2)
Net cash and cash equivalents at beginning of period 12 14
Net cash and cash equivalents at end of period 170 12
Analysis of net funds
Cash and cash equivalents 170 12
Borrowings due within one year - -
Borrowings due after one year (250) (250)
Borrowings after one year (ii) (80) (238)
Net funds
Note (i)
Reconciliation of operating profit / (loss) to net cash from operating
activities
2021 2020
£'000 £'000
Operating profit/(loss) (4,407) (120)
Share based payment charge - 3
Write off investments 486 -
Decrease/(Increase) in trade and other receivables 4,064 6
(Decrease)/Increase in trade and other payables (357) (40)
Net cash used operating activities (214) (151)
Note (ii)
Reconciliation of movement of debt
2021 2020
£'000 £'000
Net (decrease)/increase in cash and cash equivalents 158 (2)
New Borrowings - (250)
Repayment of Borrowings - 119
Movement in Borrowings for the Period 158 (133)
Net Borrowings at the Start of the Period (238) (105)
Net Borrowings at the end of the Period (80) (238)
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2021
1. SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation of these
financial statements are set out below. These policies have been consistently
applied to both years presented unless otherwise stated.
1.1 Basis of preparation
The consolidated financial statements of Norman Broadbent plc ("Norman
Broadbent" ,"the Company" or "the Group") have been prepared in accordance
with International Financial Reporting Standards as adopted by the UK (IFRS as
adopted by the UK), IFRIC interpretations and the Companies Act 2006
applicable to Companies reporting under IFRS. The consolidated financial
statements have been prepared under the historical cost convention, as
modified by the revaluation of financial assets and liabilities (including
derivative instruments) at fair value through profit or loss. The consolidated
financial statements are presented in pounds and all values are rounded to the
nearest thousand (£000), except when otherwise indicated.
The preparation of financial statements in conformity with IFRS requires the
use of certain critical accounting estimates. It also requires management to
exercise its judgement in the process of applying the Group's accounting
policies. The areas involving a higher degree of judgement or complexity, or
areas where assumptions and estimates are significant to the consolidated
financial statements are disclosed in note 1.20.
1.1.1 Going concern
The Group reported an operating loss from continued operations in the year to
31 December 2021 of £0.6m compared with an operating loss of £0.2m in 2020.
Consolidated net current liabilities are £0.5m (2020 : £0.5m).
The Consolidated Statement of Financial Position shows a net asset position at
31 December 2021 of £0.8m (2020: £1.1m) with cash at bank of £0.5m (2020:
£0.4m). At the date that these financial statements were approved the Group
had no overdraft facility, a CBILS loan of £0.25m and its receivable finance
facility (Metrobank) which is 100% secured by the Group's trade receivables.
Early 2020 saw the outbreak of the Covid-19 pandemic. This resulted in
significant global economic disruption and recovery is expected to be
relatively slow and uncertain. Despite this, the Group traded through the
difficult conditions and raised £372,000 through a majority shareholder
supported share issues in September and December 2021. Additionally, a
convertible loan note instrument issued by two major shareholders in May 2022
has provided a further £400,000 of funding.
In light of the current financial position of the Group and on consideration
of the business' forecasts and projections which have taken account of the
impact of Covid-19 and of trading performance, the Directors have a reasonable
expectation that the Group has adequate available resources to continue as a
going concern for the foreseeable future. For these reasons, they continue to
adopt the going concern basis in preparing their annual report and financial
statements.
1.1.2 Changes in accounting policy and disclosures
a) New standards, interpretations and amendments effective
The following have been applied for the first time from 1 January 2021 but
did not have a material impact on the financial statements:
· IFRS 9, IFRS 7, IFRS 4, IFRS 16 and IAS 39 (amendments) Interest Rate
Benchmark Reform Phase 2
b) New standards or amendments and interpretations to existing
standards that are not yet effective
The following are newly issued but not yet effective standards,
interpretations and amendments, Mandatory for accounting periods commencing on
or after 1 April 2021:
· IFRS 16 (amendment) Covid 19 Related Rent Concessions beyond 30 June
2021
The following are newly issued but not yet effective standards,
interpretations and amendments, Mandatory for accounting periods commencing on
or after 1 January 2022:
· Annual Improvements to IFRS Standards 2018-2020 Cycle. Minor
amendments to IFRS , IRFS 9 and IAS 41
· IAS 16 (amendments) Property, Plant and Equipment : Proceeds before
Intended Use
· IAS 37 (amendment) Onerous Contracts : Costs of Fulfilling a Contract
· IFRS 3 (amendments) Reference to Conceptual Framework
· IAS 1(amendment) Classification of Liabilities as Current or Non
Current
· IAS 1 and IFRS Practice Statement 2 (amendments) Disclosure of
Accounting Policies
· IAS 8 (amendments) Definition of Accounting Estimates
· IAS 12 (amendments) Deferred Tax related to Assets and Liabilities
arising from a Single Transaction
· IFRS 17 Insurance Contracts
The Directors do not expect that the adoption of the Standards and amendments
listed above will have a material impact on the financial statements of the
Company in future periods. Beyond the information above, it is not practicable
to provide a reasonable estimate of the effect of these Standards until a
detailed review has been completed.
1.2 Basis of consolidation and business combinations
1.2.1 Business combinations
Business combinations are accounted for using the acquisition method as at the
acquisition date - i.e. when control is transferred to the Group. Control is
the power to govern the financial and operating policies of an entity so as to
obtain benefits from its activities. In assessing control, the Group takes
into consideration potential voting rights that are currently exercisable.
The Group measures goodwill at the acquisition date as:
- the fair value of the consideration transferred; plus
- the recognised amount of any non-controlling interests in the
acquiree; plus
- if the business combination is achieved in stages, the fair
value of the pre-existing equity interest in the acquiree; less
- the net amount (generally fair value) of the identifiable
assets acquired and liabilities assumed.
When the excess is negative, a bargain purchase gain is recognised immediately
in profit or loss. Transaction costs, other than those associated with the
issue of debt or equity securities, that the Group incurs in connection with a
business combination are expensed as incurred.
Any contingent consideration payable is measured at fair value at the
acquisition date. If the contingent consideration is classified as equity,
then it is not remeasured and settlement is accounted for within equity.
Otherwise, subsequent changes in the fair value of the contingent
consideration are recognised in profit or loss.
The subsidiaries financial statements were not prepared under IFRS but
adjustments were made to bring all the accounting policies in line with IFRS.
1.2.2 Non-controlling interests
For each business combination, the Group elects to measure any non-controlling
interests in the acquiree either at fair value or at their proportionate share
of the acquiree's identifiable net assets, which are generally at fair value.
Changes in the Group's interest in a subsidiary that do not result in a loss
of control are accounted for as transactions with owners in their capacity as
owners. Adjustments to non-controlling interests are based on a proportionate
amount of the net assets of the subsidiary. No adjustments are made to
goodwill and no gain or loss is recognised in profit or loss.
1.2.3 Subsidiaries
Subsidiaries are all entities (including special purpose entities) over which
the Group has the power to govern the financial and operating policies
generally accompanying a shareholding of more than one half of the voting
rights. The existence and effect of potential voting rights that are currently
exercisable or convertible are considered when assessing if the Group controls
another entity.
Subsidiaries are fully consolidated from the date on which control is
transferred to the Group. They are de-consolidated from the date that control
ceases.
Inter-company transactions, balances and unrealised gains on transactions
between Group companies are eliminated. Unrealised losses are also eliminated.
1.3 Goodwill
Goodwill arising on acquisition of subsidiaries is included in the
Consolidated Statement of Financial Position as an asset at cost less
impairment. For the purpose of impairment testing, goodwill is allocated to
each of the Group's cash-generating units expected to benefit from the
synergies of the combination. Cash-generating units to which goodwill has been
allocated are tested for impairment annually, or more frequently where there
is an indication that the unit may be impaired. If the recoverable amount of
the cash-generating unit is less than the carrying amount of the unit, the
impairment loss is allocated first to reduce the carrying amount of any
goodwill allocated to the unit and then to other assets of the unit pro-rata
on the basis of the carrying amount of each asset in the unit. An impairment
loss recognised for goodwill is not reversed in a subsequent period.
1.4 Impairment of non-financial assets
Assets that have an indefinite useful life, for example goodwill, are not
subject to amortisation and are tested annually for impairment. Assets that
are subject to amortisation are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount by which the
asset's carrying amount exceeds its recoverable amount. The recoverable amount
is the higher of an asset's fair value less costs to sell and value in use.
For the purposes of assessing impairment, assets are grouped at the lowest
levels for which there are separately identifiable cash flows (cash-generating
units).
1.5 Financial assets and liabilities
Financial assets and liabilities are recognised initially at their fair value
and are subsequently measured at amortised cost. For trade receivables, trade
payables and other short-term financial liabilities this generally equates to
original transaction value.
1.6 Property, plant and equipment
The cost of property, plant and equipment is their purchase cost, together
with any incidental costs of acquisition.
Depreciation is calculated so as to write off the cost of the assets, less
their estimated residual values, over the expected useful economic lives of
the assets concerned. The principal annual rates used for this purpose are:
Office and computer equipment - 25% - 50% per annum on
cost
Fixtures and fittings
- 25% - 33% per annum on cost (or over the life of the lease
whichever is shorter)
Land and buildings leasehold - over 3 - 5 years
straight line
Right of use asset -
straight line over shorter of estimated useful life and lease
term
1.7 Trade receivables
Trade receivables are amounts due from customers for merchandise sold or
services performed in the ordinary course of business. If collection is
expected in one year or less (or in the normal operating cycle of the business
if longer), they are classified as current assets. If not, they are presented
as non-current assets. Trade receivables are recognised initially at fair
value and subsequently measured at amortised cost using the effective interest
method, less provision for impairment.
1.8 Cash and cash equivalents
Cash and cash equivalents include cash in hand and deposits held at call with
banks. Bank overdrafts are shown within borrowings in current liabilities on
the balance sheet.
1.9 Investments
Investments in subsidiary undertakings are stated at cost less provision for
any impairment in value. Investments are tested annually for impairment and
whenever events or changes in circumstance indicate that the carrying amount
may not be recoverable an impairment loss is recognised immediately for the
amount by which the investment's carrying amount exceeds its recoverable
value.
1.10 Borrowings
Borrowings are recognised initially at fair value, net of transaction costs
incurred. Borrowings are subsequently carried at amortised cost; any
difference between the proceeds (net of transaction costs) and the redemption
value is recognised in the income statement over the period of the borrowings
using the effective interest method.
Fees paid on the establishment of loan facilities are recognised as
transaction costs of the loan to the extent that it is probable that some or
all of the facility will be drawn down. In this case, the fee is deferred
until the draw-down occurs. To the extent there is no evidence that it is
probable that some or all of the facility will be drawn down, the fee is
recognised as a pre-payment for liquidity services and amortised over the
period of the facility to which it relates.
1.11 Invoice discounting facility
The terms of this arrangement are judged to be such that the risk and rewards
of ownership of the trade receivables do not pass to the finance provider. As
such the receivables are not derecognised on draw-down of funds against this
facility. This facility is recognised as a liability for the amount drawn.
1.12 Trade payables
Trade payables are non-interest bearing and are initially recognised at fair
value and then subsequently measured at amortised cost.
1.13 Operating segments
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision-maker. The chief decision
maker, who is responsible for allocating resources and assessing performance
of the operating segments, has been identified as the Group Executive
Committee that makes strategic decisions.
1.14 Foreign currency translation
(a) Functional and presentation currency
Items included in the financial statements of each of the Group's entities are
measured using the currency of the primary economic environment in which the
entity operates ('the functional currency'). The consolidated financial
statements are presented in sterling, which is the Company's functional and
the Group's presentation currency.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency
using the exchange rates prevailing at the dates of the transactions or
valuation where items are re-measured. Foreign exchange gains and losses
resulting from the settlement of such transactions and from the translation at
year-end exchange rates of monetary assets and liabilities denominated in
foreign currencies are recognised in the Consolidated Statement of
Comprehensive Income, except when deferred in equity as qualifying cash flow
hedges and qualifying net investment hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash
equivalents are presented in the Consolidated Statement of Comprehensive
Income within 'net finance income'. All other foreign exchange gains and
losses are presented in the income statement within 'operating expenses'.
1.15 Taxation
Taxation currently payable is based on the taxable profit for the year.
Taxable profit differs from net profit as reported in the statement of
comprehensive income because it excludes items of income and expense that are
taxable or deductible in other years and it further excludes items that are
never taxable or deductible. The Group's liability for current tax is
calculated using tax rates that have been enacted or substantively enacted by
the balance sheet date.
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit, and is accounted for using the balance sheet liability method.
Deferred tax liabilities are generally recognised for all material taxable
timing differences and deferred tax assets are recognised to the extent that
it is probable that taxable profits will be available against which deductible
temporary differences can be utilised.
Such assets and liabilities are not recognised if the temporary difference
arises from an initial recognition of goodwill or from the initial recognition
(other than in the business combination) of other assets and liabilities in
the transaction that affects neither the tax profit nor the accounting profit.
Deferred tax is calculated using the tax rates that have been enacted or
substantively enacted at the balance sheet date. Deferred tax is charged or
credited to the statement of comprehensive income, except when it relates to
items charged or credited directly to equity, in which case the deferred tax
is also dealt with in equity.
1.16 Revenue Recognition
Revenue comprises the fair value of the consideration received or receivable
for the sale of goods and services in the ordinary course of the Group's
activities and is recognised at a specific point in time. Revenue is shown net
of value-added tax, returns, rebates and discounts and after eliminating sales
within the Group. The Group recognises revenue when the amount of revenue can
be reliably measured, it is probable that future economic benefits will flow
to the entity and when specific criteria have been met for each of the Group's
activities as described below.
a) Executive search services
Executive Search services are provided on a retained basis and the Group
generally invoices the client at pre-specified milestones agreed in advance at
a specific point in time. Typically, this will be in three stages; retainer,
shortlist and completion fee. Revenue is recognised on completion of defined
stages of work during the recruitment process including the completion of a
candidate shortlist and placement of a candidate. The Solutions business is a
more flexible model and on occasions will invoice in two stages, initiation
and completion. Revenue is deferred for any invoices raised but unearned at
the year end.
b) Short-term contract and interim business
Revenue is recognised as services are rendered, validated by receipt of a
client approved timesheet or equivalent. Fixed Term Contracts or Candidate
conversions are recognised on client approval and invoice date and at invoiced
at a specific point in time.
c) Assessment, career coaching and talent management
Revenue is recognised in line with delivery. Where revenue is generated by
contracts covering a number of sessions then revenue is recognised over the
contract term based on the average number of sessions taken up and is invoiced
at a specific point in time.
d) Interest income
Interest income is accrued on a time basis, by reference to the principal
outstanding and at the effective interest rate applicable, which is the rate
that exactly discounts estimated future cash receipts through the expected
life of the financial asset to that asset's net carrying amount.
1.17 Pensions
The Group operates a number of defined contribution funded pension schemes for
the benefit of certain employees. The costs of the pension schemes are charged
to the income statement as incurred.
1.18 Leases
The Group leases its offices and various office equipment. Rental contracts
are typically made for fixed periods of 3 to 5 years but may have extension
options.
Contracts may contain both lease and non-lease components. The company
allocates the consideration in the contract to the lease and non-lease
components based on their relative standalone prices.
However, for leases of property for which the company is a lessee and for
which it has major leases, it has elected not to separate lease and non-lease
components and instead accounts for these as a single lease component.
From 1 January 2019, leases are recognised as a right-of-use asset and a
corresponding liability at the date at which the leased asset is available for
use by the company.
Assets and liabilities arising from a lease are initially measured on a
present value basis. Lease liabilities include the net present value of the
following lease payments:
• Fixed payments (including in-substance fixed payments), less any lease
incentives receivable;
• Variable lease payments that are based on an index or a rate, initially
measured using the index or rate as at the commencement date;
• Amounts expected to be payable by the company under residual value
guarantees;
• The exercise price of a purchase option if the company is reasonably
certain to exercise that option; and
• Payments of penalties for terminating the lease, if the lease term
reflects the company exercising that option.
Lease payments to be made under reasonably certain extension options are also
included in the measurement of the liability. The lease payments are
discounted using the interest rate implicit in the lease. If that rate cannot
be readily determined, which is generally the case for leases in the company,
the lessee's incremental borrowing rate is used, being the rate that the
individual lessee would have to pay to borrow the funds necessary to obtain an
asset of similar value to the right-of-use asset in a similar economic
environment with similar terms, security and conditions.
Lease payments are allocated between principal and finance cost. The finance
cost is charged to profit or loss over the lease period so as to produce a
constant periodic rate of interest on the remaining balance of the liability
for each period.
Right-of-use assets are measured at cost comprising the following:
• The amount of the initial measurement of lease liability;
• Any lease payments made at or before the commencement date less any lease
incentives received; and
• Any initial direct costs.
Right-of-use assets are generally depreciated over the shorter of the asset's
useful life and the lease term on a straight-line basis. If the company is
reasonably certain to exercise a purchase option, the right-of-use asset is
depreciated over the underlying asset's useful life. Right-of-use assets are
tested for impairment in accordance with IAS 36 Impairment of assets.
Payments associated with short-term leases of equipment and vehicles and all
leases of low-value assets (items less than £1,000) are recognised on a
straight-line basis as an expense in profit or loss. Short-term leases are
leases with a lease term of 12 months or less. Low-value assets comprise IT
equipment and small items of office furniture.
1.19 Share Option Schemes
For equity-settled share-based payment transactions the Group, in accordance
with IFRS 2, measures their value and the corresponding increase in equity,
indirectly, by reference to the fair value of the equity instruments granted.
The fair value of those equity instruments is measured at grant date, using
the trinomial method. The expense is apportioned over the vesting period of
the financial instrument and is based on the numbers which are expected to
vest and the fair value of those financial instruments at the date of grant.
If the equity instruments granted vest immediately, the expense is recognised
in full.
1.20 Critical accounting judgements and estimates
a) Impairment of goodwill - determining whether goodwill is
impaired requires an estimation of the value in use of cash-generating units
(CGUs) to which goodwill has been allocated. The value in use calculation
requires an estimation of the future profitability expected to arise from the
CGU and a suitable discount rate in order to calculate present value.
b) Impairment of investments - determining whether investments are
impaired requires an estimation of the value in use of each subsidiary. The
value in use calculation requires an estimation of the future profitability
expected to arise from each subsidiary and a suitable discount rate in order
to calculate present value.
c) Revenue recognition - revenue is recognised based on estimated
timing of delivery of services based on the assignment structure and
historical experience. Were these estimates to change then the amount of
revenue recognised would vary.
2 FINANCIAL RISK MANAGEMENT
The financial risks that the Group is exposed to through its operations are
interest rate risk, liquidity risk and credit risk. The Group's overall risk
management programme focuses on the unpredictability of financial markets and
seeks to minimise potential adverse effects on the Group's financial
performance.
There have been no substantive changes in the Group's exposure to financial
risks, its objectives, policies and processes for managing those risks or the
methods used to measure them from previous periods, unless otherwise stated in
this note.
The Board has overall responsibility for the determination of the Group's risk
management objectives and policies and, whilst retaining ultimate
responsibility for them, it has delegated the authority for designing and
operating processes that ensure the effective implementation of the objectives
and policies to the Group's Executive Committee.
The Board receives monthly reports from the Group Chief Financial Officer,
through which it reviews the effectiveness of the processes put in place and
the appropriateness of the objectives and policies it sets. The overall
objective of the Board is to set policies that seek to reduce risk as far as
possible, without unduly affecting the Group's competitiveness and
flexibility. Further details regarding specific policies are set out below:
2.1 Interest rate risk
The Group's interest rate risk arises from short term borrowings issued at a
variable interest rate. At 31 December 2021 the balance outstanding on the
invoice discounting facility was £1.0 million (2020: £0.6 million) and this
balance increases and decreases in line with the outstanding trade
receivables.
2.2 Liquidity risk
Liquidity risk arises from the Group's management of working capital and the
finance charges. It is the risk that the Group will encounter difficulty in
meeting its financial obligations as they fall due. The Group's policy is to
ensure that it will always have sufficient cash to allow it to meet its
liabilities when they become due. To achieve this aim, the Group monitors its
requirements on a rolling monthly basis. The Board receives cash flow
projections as well as monthly information regarding cash balances. At the
balance sheet date, these projections indicated that the Group expected to
have sufficient liquid resources to meet its obligations under reasonably
expected circumstances.
2.3 Credit risk
Credit risk is the risk of financial loss to the Group if a customer or
counterparty to a financial instrument fails to meet its contractual
obligations. The Group is mainly exposed to credit risk from credit sales. It
is Group policy, to assess the credit risk of new customers before entering
contracts.
Each new customer is analysed individually for creditworthiness before the
Group's standard payment and delivery terms and conditions are offered. The
Board determines concentrations of credit risk by reviewing the trade
receivables' ageing analysis.
The Board monitors the ageing of credit sales regularly and at the reporting
date does not expect any losses from non-performance by the counterparties
other than those specifically provided for (see Note 13). The Directors are
confident about the recoverability of receivables based on the blue chip
nature of its customers, their credit ratings and the very low levels of
default in the past.
2.4 Capital risk management
The Group's objectives when managing capital are to safeguard the Group's
ability to continue as a going concern in order to provide returns for
shareholders and benefits for other stakeholders and tomaintain an optimal
capital structure to reduce the cost of capital.
The Group sets the amount of capital it requires in proportion to risk. The
Group manages its capital structure and makes adjustments to it in the light
of changes in economic conditions and the risk characteristics of the
underlying assets. In order to maintain or adjust the capital structure, the
Group may adjust the amount of dividends paid to shareholders, return capital
to shareholders, issue new shares or sell assets to reduce debt.
3 SEGMENTAL ANALYSIS
Management has determined the operating segments based on the reports reviewed
regularly by the Board for use in deciding how to allocate resources and in
assessing performance. The Board considers Group operations from both a class
of business and geographic perspective. Each class of business derives its
revenues from the supply of a particular recruitment related service, from
retained executive search through to executive assessment and coaching.
Business segment results are reviewed primarily to revenue level.
Group revenues are primarily driven from UK operations. However when revenue
is derived from overseas business the results are presented to the Board by
geographic region to identify potential areas for growth or those posing
potential risks to the Group.
i) Class of Business:
The analysis by class of business of the Group's turnover and is set out
below:
2021 2020
£'000 £'000
Revenue - Search 4,330 3,771
Revenue - Interim Management 1,949 3,724
Revenue - Leadership Consulting 270 321
6,549 7,816
Cost of sales (690) (1,530)
Gross profit 5,859 6,286
Operating expenses (5,854) (6,217)
Depreciation and amortisation (229) (222)
Restructuring costs (308) -
Finance costs (41) (40)
Profit/(Loss) before tax (573) (193)
ii) Revenue and gross profit by geography
2021 2020 2021 2020
Revenue Revenue Gross Profit Gross Profit
£'000 £'000 £'000 £'000
United Kingdom 5,717 7,143 5,027 5,613
Rest of the world 832 673 832 673
Total 6,549 7,816 5,859 6,286
4 PROFIT / (LOSS) ON ORDINARY ACTIVITIES BEFORE TAXATION
2021 2020
£'000 £'000
Profit / (Loss) on ordinary activities before taxation is stated after
charging:
Depreciation and impairment of property, plant and equipment 227 222
Gain on foreign currency exchange - -
Staff costs (see note 5) 4,555 4,853
Operating lease rentals:
Land and buildings - -
Auditors' remuneration:
Audit work 43 38
Non-audit work - -
The Company audit fee for the year was £43,000 (2020: £38,000).
5 STAFF COSTS
The average number of full time equivalent persons (including Directors)
employed by the Group during the year was as follows:
2021 2020
No. No.
Sales and related services 30 34
Administration 15 13
45 47
Staff costs (for the above persons):
£'000 £'000
Wages and salaries 3,952 4,165
Social security costs 419 550
Defined contribution pension cost 184 138
4,555 4,853
The emoluments of the Directors are disclosed as required by the Companies Act
2006 on page 15 in the Directors' Remuneration Report. The table of Directors'
emoluments has been audited and forms part of these financial statements. This
also includes details of the highest paid Director.
6 TAX EXPENSE
(a) Tax charged in the income statement
Taxation is based on the loss for the year and comprises:
2021 2020
£'000 £'000
Current tax:
United Kingdom corporation tax at 19% (2020: 19%) based on loss for the year - -
Foreign Tax - -
Total current tax - -
Deferred tax:
Origination and reversal of temporary differences 69 -
Tax charge/(credit) 69 -
(b) Reconciliation of the total tax charge
The difference between the current tax shown above and the amount calculated
by applying the standard rate of UK corporation tax to the profit before tax
is as follows:
2021 2020
£'000 £'000
Profit / (Loss) on ordinary activities before taxation (573) (193)
Tax on profit / (loss) on ordinary activities at standard UK corporation tax (109) (37)
rate of 19% (2020: 19%)
Effects of:
Expenses not deductible 7 9
Depreciation in excess of capital allowances 32 (2)
Provision Movement 1 3
Group Relief - 1
Release of deferred tax asset 69 -
Adjustment to losses carried forward 69 26
Current tax charge for the year 69 -
(c) Deferred tax
Tax losses Total
£'000 £'000
At 1 January 2021 (69) (69)
Charged to the income statement in 2021 69 -
At 31 December 2021 - (69)
At 31 December 2021 the Group had capital losses carried forward of
£8,129,000 (2020: £8,129,000). A deferred tax asset has not been recognised
for the capital losses as the recoverability in the near future is uncertain.
The Group also has £14,497,676 (2020: £14,131,421) trading losses carried
forward, which includes £8,987,000 losses transferred from BNB Recruitment
Consultancy Ltd in 2011. A deferred tax asset of £1,273,838 (2020:
£1,277,079) has not been recognised in the financial statements due to the
inherent uncertainty as to the quantum and timing of its utilisation.
The analysis of deferred tax in the consolidated balance sheet is as follows:
2021 2020
£'000 £'000
Deferred tax assets: - 69
Tax losses carried forward
Total - 69
7 NET FINANCE COST
2021 2020
£'000 £'000
Interest payable on Leases and Invoicing facility 41 40
Total 41 40
8 EARNINGS PER SHARE
i) Basic earnings per share
This is calculated by dividing the profit attributable to equity holders of
the Company by the weighted average number of ordinary shares in issue during
the period:
2021 2020
Profit/(Loss) attributable to owners of the company £(642,000) £(322,000)
Weighted average number of ordinary shares 56,487,344 54,217,990
Total 56,487,344 54,217,990
ii) Diluted earnings per share
This is calculated by adjusting the weighted average number of ordinary shares
outstanding to assume conversion of all dilutive potential ordinary shares.
The Company has one category of dilutive potential ordinary shares in the form
of employee share options. For these options a calculation is done to
determine the number of shares that could have been acquired at fair value
(determined as the average annual market share price of the Company's shares)
based on the monetary value of the subscription rights attached to the
outstanding options. The number of shares calculated as above is compared with
the number of shares that would have been issued assuming the exercise of the
share options.
2021 2020
Profit/(Loss) attributable to owners of the company £(642,000) £(322,000)
Weighted average number of ordinary shares 56,487,344 54,217,990
Total 56,487,344 54,217,990
iii) Adjusted earnings per share
An adjusted earnings per share has also been calculated in addition to the
basic and diluted earnings per share and is based on earnings adjusted to
eliminate the effects of charges for share based payments. It has been
calculated to allow shareholders to gain a clearer understanding of the
trading performance of the Group.
2021 2021 2021 2020 2020 2020
£'000 Basic pence Diluted pence per share £'000 Basic pence Diluted pence per share
per share
per share
Basic earnings
Profit/(Loss) after tax (642) (1.14) (1.14) (322) (0.59) (0.59)
Adjustments
Share based payment charge - - - - - -
Adjusted earnings (642) (1.14) (1.14) (322) (0.59) (0.59)
9 PROFIT OF PARENT COMPANY
As permitted by Section 408 of the Companies Act 2006, the income statement of
the parent company is not presented as part of these accounts. The parent
company's loss for the year amounted to £4,407,000 (2020: £128,000) of which
£3,730,000 (2020:£Nil) related to write off of intercompany balances with
Norman Broadbent Executive Search Limited.
10 INTANGIBLE ASSETS
Goodwill arising on consolidation
£'000
Group 3,690
Balance at 1 January 2020
Balance at 31 December 2020 3,690
Balance at 31 December 2021 3,690
Provision for impairment
Balance at 1 January 2020 2,327
Balance at 31 December 2020 2,327
Balance at 31 December 2021 2,327
Net book value
At 1 January 2019 1,363
At 31 December 2019 1,363
At 31 December 2020 1,363
At 31 December 2021 1,363
Goodwill acquired through business combinations is allocated to
cash-generating units (CGU) identified at divisional level. The carrying value
of intangible allocated by CGU is shown below:
Norman Broadbent Norman Broadbent Leadership Consulting Total
£'000 £'000 £'000
At 1 January 2020 1,303 60 1,363
At 31 December 2020 1,303 60 1,363
At 31 December 2021 1,303 60 1,363
In line with International Financial Reporting Standards, goodwill has not
been amortised from the transition date, but has instead been subject to an
impairment review by the Directors of the Group. As set out in accounting
policy note 1 on page 34, the Directors test the goodwill for impairment
annually. The recoverable amount of the Group's CGUs are calculated on the
present value of their respective expected future cash flows, applying a
weighted average cost of capital in line with businesses in the same sector.
Pre-tax future cash flows for the next five years are derived from the
approved forecasts for the 2022 financial year.
The key assumption applied to the forecasts for the business is that return on
sales for Norman Broadbent is expected to be a minimum of 5% per annum for the
foreseeable future (2020: 4%) and 42% for Norman Broadbent Leadership
Consulting (2020: 5%). Return on sales is defined as the expected profit
before tax on net revenue. There are only minimal non cash flows included in
profit before tax. The rate used to discount the forecast cash flows is 10%
(2020: 8%).
11. PROPERTY, PLANT AND EQUIPMENT
Land and buildings - leasehold Right of Use asset Office and computer equipment Fixtures and fittings Total
£'000 £'000 £'000 £'000 £'000
Group
Cost
Balance at 1 January 2020 84 - 206 206 496
Additions 10 408 48 7 473
Disposals - - - (163) (163)
Balance at 31 December 2020 94 408 254 50 806
Additions - 366 55 - 421
Disposals - - - - -
Balance at 31 December 2021 94 774 309 50 1,227
Accumulated depreciation
Balance at 1 January 2020 83 - 159 167 409
Charge for the year 4 163 18 37 222
Disposals - - - (157) (157)
Balance at 31 December 2020 87 163 177 47 474
Charge for the year 5 169 50 3 227
Disposals - - - - -
Balance at 31 December 2021 92 332 227 50 701
Net book value
At 1 January 2020 1 - 47 39 87
At 31 December 2020 7 245 77 3 332
At 31 December 2021 2 442 82 - 526
The Group had no capital commitments as at 31 December 2021 (2020 : £Nil).
12 INVESTMENTS
Shares in subsidiary undertakings
£'000
Company
Cost
Balance at 1 January 2020 5,935
Balance at 31 December 2020 5,935
Balance at 31 December 2021 5,935
Provision for impairment
Balance at 1 January 2020 4,249
Impairment for the year -
Balance at 31 December 2020 4,249
Impairment for the year 486
Balance at 31 December 2021 4,735
Net book value
At 1 January 2020 1,686
At 31 December 2020 1,686
At 31 December 2021 1,200
At 31 December 2021 the Company held the following ownership interests:
Principal Group investments: Country of incorporation or registration and operation Principal activities Description and proportion of shares held by the Company
Norman Broadbent Executive Search Ltd England and Wales Executive search 100% ordinary shares
Norman Broadbent Overseas Ltd England and Wales Non Trading 100% ordinary shares
Norman Broadbent Leadership Consulting Limited England and Wales Assessment, coaching and talent mgmt. 100% ordinary shares
Norman Broadbent Solutions Ltd England and Wales Mezzanine level search 100% ordinary shares
Bancomm Ltd ** England and Wales Dormant 100% ordinary shares
Norman Broadbent Ireland Ltd* ** Republic of Ireland Dormant 100% ordinary shares
Norman Broadbent Interim Management Ltd England and Wales Interim Management 100% ordinary shares
* 100 % of the issued share capital of this company is owned by Norman
Broadbent Overseas Ltd.
** These companies are exempt from audit by virtue of
provisions in the Companies Act 2006.
The registered office for the subsidiaries are Millbank Tower, 21-24 Millbank
London SW1P 4QPP with the exception of Norman Broadbent Ireland Limited.
13 TRADE AND OTHER RECEIVABLES
Group Company
2021 2020 2021 2020
£'000 £'000 £'000 £'000
Trade receivables 1,746 1,509 - -
Less: provision for impairment (14) (60) - -
Trade receivables - net 1,732 1,449 - -
Other debtors 127 88 - 66
Prepayments and accrued income 56 155 14 15
Due from Group undertakings - - 1,371 5,368
Total 1,915 1,692 1,385 5,449
Non-Current - 145 -- 66
Current 1,915 1,547 1,385 5,383
1,915 1,692 1,385 5,449
Non-current trade receivables are in relation to the cash consideration due
from the sale of SMS in 2016.
As at 31 December 2021, Group trade receivables of £967,000 (2020:
£797,000), were past their due date but not impaired, save as referred to
below. They relate to customers with no default history. The ageing profile of
these receivables is as follows:
Group Company
2021 2020 2021 2020
£'000 £'000 £'000 £'000
Up to 3 months 811 595 - -
3 to 6 months 136 128 - -
6 to 12 months 20 74 - -
Total 967 797 - -
The largest amount due from a single trade debtor at 31 December 2021
represents 9% (2020: 8%) of the total trade receivables balance outstanding.
As at 31 December 2021, £14,000 of group trade receivables (2020: £60,000)
were considered impaired. A provision for impairment has been recognised in
the financial statements. Movements on the Group's provision for impairment of
trade receivables are as follows:
2021 2020
£'000 £'000
At 1 January 60 49
Provision for receivable impairment - 11
Receivables written-off as uncollectable (46) -
At 31 December 14 60
There are no material difference between the carrying value and the fair value
of the Group's and parent Company's trade and other receivables.
14 CASH AND CASH EQUIVALENTS
Group Company
2021 2020 2021 2020
£'000 £'000 £'000 £'000
Cash at bank and in hand 459 367 170 12
Total 459 367 170 12
There is no material difference between the carrying value and the fair value
of the Group's and parent Company's cash at bank and in hand.
15 TRADE AND OTHER PAYABLES
Group Company
2021 2020 2021 2020
£'000 £'000 £'000 £'000
Trade payables 184 150 26 18
Due to Group undertakings - - 1,157 1,518
Other taxation and social security 344 535 (4) -
Other payables 151 30 - -
Accruals 1,048 930 69 69
Total 1,727 1,645 1,248 1,605
There is no material difference between the carrying value and the fair value
of the Group's and parent company's trade and other payables.
16 BORROWINGS
Group Company
2021 2020 2021 2020
£'000 £'000 £'000 £'000
Maturity profile of borrowings
Current
Bank overdrafts and interest bearing loans:
Invoice discounting facility (see note (a) below) 952 577 - -
Non Current 250 250 250 250
Bank Loans (see note (b) below)
Total 1,202 827 250 250
The carrying amounts and fair value of the Group's borrowings, which are all
denominated in sterling, are as follows:
Carrying amount Fair value
2021 2020 2021 2020
£'000 £'000 £'000 £'000
Bank overdrafts and interest bearing loans:
Invoice discounting facility 952 577 952 577
Bank Loans (see note (b) below) 250 250 250 250
Total 1,202 827 1,202 827
a) Invoice discounting facilities:
For the full year 2020 through February 2021 Norman Broadbent Executive Search
Limited, Norman Broadbent Solutions Ltd, Norman Broadbent Interim Management
Ltd and Norman Broadbent Leadership Consulting Ltd operated independent
invoice discounting facilities, provided by Bibby Financial Services Limited.
Bibby Financial Services Limited held all assets debentures for each company
(fixed and floating charges) and also a cross-corporate guarantee and
indemnity deed dated 20 August 2019.
In February 2021 the Group terminated the contract with Bibby Financial
Services Limited and opened a new invoice discounting facility with Metro
Bank. All Group invoices were raised through Norman Broadbent Executive
Search Ltd from start of 2021 and as such Metrobank (SME Invoice Finance Ltd)
holds an all asset debenture for Norman Broadbent plc and Norman Broadbent
Executive Search Limited. Funds are available to be drawn down at an advance
rate of 88% against trade receivables of Norman Broadbent Executive Search Ltd
that are aged less less than 120 days with the facility capped at
£1,500,000. At December 31 2021, the outstanding balance on the facility of
£951,995 was secured by trade receivables of £1,720,507. Interest is
charged on the drawn down funds at a rate of 2.4% above the bank base rate.
b) Bank Loans
In November 2020 the Group received a CBILS Loan of £250,000 for a term of 6
years. Repayment of capital and interest began in January 2022, and from this
month the loan incurs interest at 4.75% above the Metro Bank UK base rate.
Metrobank holds an all asset fixed and floating charge over Norman Broadbent
Executive Search Ltd linked to this facility.
17 FINANCIAL INSTRUMENTS
The principal financial instruments used by the Group and Company, from which
financial instrument risk arises, are summarised below. All financial assets
and liabilities are measured at amortised cost which is not considered to be
materially different to fair value.
Amortised Cost
2021 2020
£'000 £'000
Group
Financial Assets
Trade and other receivables 1,732 1,449
Other debtors 127 36
1,859 1,485
Financial Liabilities
Trade creditors 184 150
Accrual and deferred income 1,049 929
Other creditors 151 30
Bank Loans - Current 952 577
Bank Loans - Greater than one year 250 250
2,586 1,936
Amortised Cost
2021 2020
£'000 £'000
Company
Financial Assets
Trade and other receivables - 66
Amounts owed by group undertakings 1,371 5,368
Financial Liabilities
Trade and other payables 26 18
Amounts owed to group undertakings 1,157 1,518
Accruals and deferred income 69 69
Bank loans - Greater than one year 250 250
In common with all other businesses, the Group is exposed to risks that arise
from its use of financial instruments. Details on these risks and the policies
set out by the Board to reduce them can be found in Note 2.
18 SHARE CAPITAL AND PREMIUM
2021 2020
£'000 £'000
Allotted and fully paid:
Ordinary Shares:
60,740,757 Ordinary shares of 1.0p each (2020: 55,218,870) 607 552
Deferred Shares:
23,342,400 Deferred A shares of 4.0p each (2020: 23,342,400) 934 934
907,118,360 Deferred shares of 0.4p each (2020: 907,118,360) 3,628 3,628
1,043,566 Deferred B shares of 42.0p each (2020: 1,043,566) 438 438
2,504,610 Deferred C shares of 29.0p each (2020: 2,504,610) 727 727
Total 6,334 6,279
Deferred A Shares of 4.0p each
The Deferred A Shares carry no right to dividends or distributions or to
receive notice of or attend general meetings of the Company. In the event of a
winding up, the shares carry a right to repayment only after the holders of
Ordinary Shares have received a payment of £10,000 per Ordinary Share. The
Company retains the right to cancel the shares without payment to the holders
thereof. The rights attaching to the shares shall not be varied by the
creation or issue of shares ranking pari passu with or in priority to the
Deferred A Shares.
Deferred Shares of 0.4p each
The Deferred Shares carry no right to dividends, distributions or to receive
notice of or attend general meetings of the Company. In the event of a winding
up, the shares carry a right to repayment only after payment of capital paid
up on Ordinary Shares plus a payment of £10,000 per Ordinary Share. The
Company retains the right to transfer or cancel the shares without payment to
the holders thereof.
Deferred B Shares of 42.0p each
The Deferred B Shares carry no right to dividends or distributions or to
receive notice of or attend general meetings of the Company. In the event of a
winding up, the shares carry the right to repayment only after the holders of
Ordinary Shares have received a payment of £10 million per Ordinary Share.
The Company retains the right to cancel the shares without payment to the
holders thereof. The rights attaching to the shares shall not be varied by the
creation or issue of shares ranking pari passu with or in priority to the
Deferred B Shares.
Deferred C Shares of 29.0p each
The Deferred Shares carry no right to dividends or distributions or to receive
notice of or attend general meetings of the Company. In the event of a winding
up, the shares carry the right to repayment only after the holders of Ordinary
Shares have received a payment of £10,000 per Ordinary Share. The Company
retains the right to cancel the shares without payment to the holders thereof.
A reconciliation of the movement in share capital and share premium is
presented below:
No. of Ordinary shares Deferred shares Share Total
ordinary
premium
shares £(000s) £(000s)
£(000s)
(000s) £(000s)
At 1 January 2020 53,885 539 5,727 13,706 19,972
Issued during the year 1,333 13 - 57 70
At 31 December 2020 55,218 552 5,727 13,763 20,042
Issued during the year 5,523 55 - 317 372
At 31 December 2021 60,741 607 5,727 14,080 20,414
During the year 5,521,854 Ordinary Shares were issued at a consideration of
6.75 pence per share.
19 SHARE BASED PAYMENTS
The Company has an approved EMI share option scheme for full time employees
and Directors. The exercise price of the granted options is equal to the
market price of the shares on the date of the grant. The Company has no legal
or constructive obligation to repurchase or settle the options or warrants in
cash.
Options under the Company EMI scheme are conditional on the employee
completing three years' service (the vesting period). The EMI options vest in
three equal tranches on the first, second and third anniversary of the grant.
The options have a contractual option term of either seven or ten years.
Movements in the number of share options and their related weighted average
exercise prices are as follows:
Approved EMI
share option scheme
Avg. exercise price per share (p) Number of options
At 1 January 2020 14.41 3,549,147
Granted - -
Forfeited 13.50 (1,643,614)
At 31 December 2020 14.41 1,905,533
Granted - -
Forfeited - (1,905,533)
At 31 December 2021 - -
20 LEASES
The Group has adopted IFRS Leases 16 for its treatment of the lease properties
in Millbank Tower, London and Booth Park, Knutsford.
Under IFRS 16, the Group has recognised within the Consolidated Balance Sheet
a right-of-use asset and a lease liability for all applicable leases. Within
the Consolidated Income Statement, operating lease rentals charges have been
replaced with depreciation and interest expense.
Set out below are the accounting policies of the Group under IFRS 16, which
have been applied from the date of initial application.
Right-of-use assets : The Group recognises right-of-use assets at the
commencement date of the lease and are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for any remeasurement of
lease liabilities. The cost of right-of-use assets includes the amount of
lease liabilities recognised, initial direct costs incurred, and lease
payments made at or before the commencement date less any lease incentives
received. Unless the Group is reasonably certain to obtain ownership of the
leased asset at the end of the lease term, the recognised right-of-use assets
are depreciated on a straight line basis over the shorter of its estimated
useful life and the lease term. Right-of-use assets are subject to impairment.
Lease liabilities : At the commencement date of the lease, the Group
recognises lease liabilities measured at the present value of lease payments
to be made over the lease term. The Group uses the incremental borrowing rate
at the lease commencement date if the interest rate implicit in the lease is
not readily determinable.
Consolidation Statement
2021 2020
£'000
£'000
Depreciation
expense
(169) (163)
Operating
profit
(169) (163)
Finance costs
(27) (17)
Profit before tax
(196) (180)
Consolidated Statement of Financial Position
Right of use assets
Lease Liabilities
As at 1 January
2020
-
-
Additions
408 (408)
Disposals
-
-
Depreciation
expense
(163) -
Interest
expense
-
(17)
Payments
-
180
At 31 December
2020
245 (245)
Additions
366 (366)
Disposals
-
-
Depreciation
expense
(169) -
Interest
expense
-
(27)
Payments
-
140
As at 31 December 2021
442 (498)
Impact on Consolidated Statement of Financial
Position
2021 2020
£'000 £'000
Right-of-use assets
442 245
Total Assets
442 245
Lease liabilities - less than one year
(200) (196)
Lease liabilities - more than one year
(298) (49)
Total Liabilities
(498) (245)
Equity
(56) -
21 PROVISIONS
Group
2021 2020
£'000 £'000
At 1 January - 215
Provisions made during the year - -
Provisions Utilised during the year - (215)
At 31 December - -
Current liability - -
Non-current liability - -
At 31 December - -
The Group moved its headquarters in March 2020 to Millbank Tower, London.
There are no dilapidations requirements under the lease and therefore no
provision for dilapidations has been made.
The liability relating to dilapidations in the previous headquarters was
settled in full during 2020.
22 PENSION COSTS
The Group operates several defined contribution pension schemes for the
business. The assets of the schemes are held separately from those of the
Group in independently administered funds. The pension cost represents
contributions payable by the Group to the funds and amounted to £184,000
(2020: £195,000). At the year-end £19,000 of contributions were outstanding
(2020: £16,000).
23 RELATED PARTY TRANSACTIONS
The following transactions were carried out with related parties:
Key management compensation:
Key management includes Executive and Non-Executive Directors. The
compensation paid or payable to the directors can be found in the Directors'
Remuneration Report on page 14-16.
24 CONTINGENT LIABILITY
The Company is a member of the Norman Broadbent plc Group VAT scheme. As such
it is jointly accountable for the combined VAT liability of the Group. The
total VAT outstanding in the Group at the year-end was £205,000 (2020:
£383,000).
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the 83rd Annual General Meeting ("AGM") of Norman
Broadbent plc will be held at 10am at 7(th) Floor Millbank Tower, 21-24
Millbank, London SW1P 4QP (and by Zoom conference software meeting) on 23rd
June 2022 to consider and, if thought fit, pass the following resolutions, of
which resolutions 1 to 7 will be proposed as ordinary resolutions and
resolution 8 and 9 will be proposed as a special resolution:
Ordinary Resolutions
1 To receive and adopt the statement of accounts of the Company
for the year ended 31 December 2021 together with the reports of the
Directors and Auditors thereon.
2 To re-elect Stephen Smith, who is retiring by rotation in
accordance with the articles of the Company and who offers himself for
re-election as a Director of the Company.
3 To re-elect Peter Searle, who only holds office until the date
of this AGM in accordance with the articles of the Company and who
automatically offers himself up for election.
4 To re-elect Kevin Davidson, who only holds office until the
date of this AGM in accordance with the articles of the Company and who
automatically offers himself up for election.
5 To re-elect Devyani Vaishampayan, who only holds office until
the date of this AGM in accordance with the articles of the Company and who
automatically offers herself up for election.
6 To appoint Kreston Reeves LLP as Auditors to act as such until
the conclusion of the next Annual General Meeting of the Company and to
authorise the Directors of the Company to fix their remuneration.
7 That in substitution for all existing and unexercised
authorities and powers, the directors of the Company be generally and
unconditionally authorised for the purpose of section 551 Companies Act 2006
(the Act):
(a) to exercise all or any of the powers of the Company to allot
shares of the Company or to grant rights to subscribe for, or to convert any
security into, shares of the Company (those shares and rights being together
referred to as Relevant Securities) up to a total nominal value of £200,444
to those persons at the times and generally on the terms and conditions as the
directors may determine (subject always to the articles of association of the
Company); and further;
(b) to allot equity securities (as defined in section 560 of the Act)
up to a total nominal value of £ 406,962 (that amount to be reduced by the
nominal value of any Relevant Securities allotted under the authority in
paragraph a above) in connection with a rights issue or similar offer in
favour of ordinary shareholders where the equity securities respectively
attributable to the interest of all ordinary shareholders are proportionate
(as nearly as may be) to the respective numbers of ordinary shares held by
them subject only to those exclusions or other arrangements as the directors
of the Company may consider appropriate to deal with fractional entitlements
or legal and practical difficulties under the laws of, or the requirements of
any recognised regulatory body in any, territory,
PROVIDED THAT this authority shall, unless previously renewed, varied or
revoked by the Company in general meeting, expire at the conclusion of the
next annual general meeting or on the date which is six months after the next
accounting reference date of the Company (if earlier) save that the directors
of the Company may, before the expiry of that period, make an offer or
agreement which would or might require relevant securities or equity
securities (as the case may be) to be allotted after the expiry of that period
and the directors of the Company may allot relevant securities or equity
securities (as the case may be) under that offer or agreement as if the
authority conferred by this resolution had not expired.
Special Resolutions
8 That if resolution 7 above is passed, the directors of the Company
be authorised to allot equity securities (as defined in section 560 of the
Act) for cash under the authority given by that resolution 7 and/or to sell
ordinary shares held by the Company as treasury shares for cash as if section
561 of the Act did not apply to that allotment or sale, the authority to be
limited to:
8.1 the allotment of equity securities or sale of treasury shares in
connection with a rights issue or similar offer in favour of ordinary
shareholders where the equity securities respectively attributable to the
interests of all ordinary shareholders are proportionate (as nearly as may be)
to the respective numbers of ordinary shares held by them subject only to
those exclusions or other arrangements as the directors of the Company may
consider appropriate to deal with fractional entitlements or legal and
practical difficulties under the laws of, or the requirements of any
recognised regulatory body in any, territory; and
8.2 the allotment of equity securities or sale of treasury shares
(otherwise than under paragraph 8.1 above) up to a total nominal amount of
£60,741 representing approximately 10% of the current share capital of the
Company,
that authority to expire at the end of the next annual general meeting of the
Company (or, if earlier, at the close of business on the date that is 15
months following the date of this meeting) but, in each case, before its
expiry the Company may make offers, and enter into agreements, which would, or
might, require equity securities to be allotted (and treasury shares to be
sold) after the authority expires and the directors of the Company may allot
equity securities (and sell treasury shares) under any such offer or agreement
as if the authority had not expired.
9 That subject to the passing of resolution 7 above, the
directors of the Company be authorised to allot equity securities (as defined
in section 560 of the Act) under the authority given by resolution 7 as if
section 561 of the Act did not apply to that allotment up to a total nominal
amount of £31,429 in connection with the loan notes of £200,000 nominal each
issued to each of Downing Strategic Micro-Cap Investment Trust Plc and Moulton
Goodies Limited 50% of which (plus compounded interest) becoming convertible
upon the passing of this resolution pursuant to and in accordance with the
terms of the secured loan instrument dated 20th May 2022 (a copy
of which is available for inspection at the Company's registered office and is
also available on the Company's website at www.normanbroadbent.com) under
which such loan notes have been issued.
By order of the Board:
R Robinson FCA
Company Secretary
Registered Office
Millbank Tower
21- 24 Millbank
London SW1P 4QP
www.normanbroadbent.com
24th May, 2021
Notes:
1 The Company has arranged for a quorum to be present in person
at the General Meeting, and all Shareholders are strongly encouraged to vote
on the Resolutions by appointing the Chair of the meeting (who will be
present in person) as their proxy before the deadline of 10.00 a.m. on 20th
June, 2022.
For shareholders not wishing to attend the AGM in person, the Company intends
to provide access to the AGM by using the conferencing software, Zoom.
Shareholders will need to register to attend the meeting by writing to Ms
Stephanie Alexander (EA to the CEO) at the Companies registered address, or by
emailing to stephanie.alexander@normanbroadbent.com. Deadline for
registration is 20th June, 2022 and instructions for access to the Zoom
meeting will be sent or emailed by 21(st) June, 2022 at the latest. The
Company is keen to improve communications with Shareholders and therefore
Shareholders are advised to send any questions for the Board at the AGM prior
to the meeting in accordance with the instructions included within the Notice
of Annual General Meeting. Shareholders will not be able to vote via Zoom, and
are therefore strongly urged to vote by appointing the Chair of the meeting as
their proxy by completing their form of proxy in accordance with the
instructions printed on the form of proxy. This measure is designed to promote
the health and wellbeing of the Company's Shareholders, its employees and the
wider community, which is of upmost importance.
2 A member entitled to attend and vote at the meeting is also
entitled to appoint a proxy to exercise his rights to attend, speak and vote
at the meeting instead of him/her. The proxy need not be a member of the
Company. More than one proxy may be appointed to exercise the rights attaching
to different shares held by the member, but a member may not appoint more than
one proxy to exercise rights attached to any one share. A form of proxy is
enclosed with this notice for use at the meeting.
3 In order to be valid an appointment of proxy (together with any
authority under which it is executed or a copy of the authority certified
notarial) must be returned by one of the following methods:
- in hard copy form by post, by courier or by hand to the
Company's registrars: Link Group, Central Square, 10(th) Floor, 29 Wellington
Street, Leeds, LS1 4DL.
· via www.signalshares.com
(https://protect-eu.mimecast.com/s/rAB3CMZBohq3OrFJUDav?domain=signalshares.com)
; or
- in the case of CREST members, by utilising the CREST
electronic proxy appointment service in accordance with the procedures set out
below and in each case must be received by the Company not less than 48 hours
before the time of the meeting.
CREST members who wish to appoint a proxy or proxies
through the CREST electronic proxy appointment service may do so for the AGM
and any adjournment thereof by using the procedures described in the CREST
Manual. CREST personal members or other CREST sponsored members, and those
CREST members who have appointed a voting service provider(s) should refer to
their CREST sponsor or voting service provider(s), who will be able to take
the appropriate action on their behalf.
In order for a proxy appointment, or instruction, made by
means of CREST to be valid, the appropriate CREST message (a "CREST Proxy
Instruction") must be properly authenticated in accordance with Euroclear UK
& Ireland Limited's ("EUI") specifications and must contain the
information required for such instructions, as described in the CREST Manual.
The message regardless of whether it relates to the appointment of a proxy or
to an amendment to the instruction given to a previously appointed proxy must,
in order to be valid, be transmitted so as to be received by the issuer's
agent (ID RA 10) by the latest time(s) for receipt of proxy appointments
specified in the Notice of Meeting. For this purpose, the time of receipt will
be taken to be the time (as determined by the timestamp applied to the message
by the CREST Applications Host) from which the issuer's agent is able to
retrieve the message by enquiry to CREST in the manner prescribed by CREST.
The Company may treat as invalid a CREST Proxy Instruction in the
circumstances set out in Regulation 35(5) of the Uncertificated Securities
Regulations 2001. CREST members and where applicable, their CREST sponsors or
voting service providers should note that EUI does not make available special
procedures in CREST for any particular messages. Normal system timings and
limitations will therefore apply in relation to the input of CREST Proxy
instructions. It is therefore the responsibility of the CREST member concerned
to take (or, if the CREST member is a CREST personal member or sponsored
member or has appointed a voting service provider(s), to procure that his or
her CREST sponsor or voting service provider(s) take(s)) such action as shall
be necessary to ensure that a message is transmitted by means of the CREST
system by any particular time. In this connection, CREST members and, where
applicable, their CREST sponsors or voting service providers are referred, in
particular, to those sections of the CREST Manual concerning practical
limitations of the CREST system and timings.
4 In the case of joint holders, the vote of the senior who
tenders a vote, whether in person or by proxy, will be accepted to the
exclusion of the votes of any other joint holders. For these purposes
seniority shall be determined by the order in which the names stand in the
register of members in respect of the joint holding.
5 In the case of a corporation, the form of proxy must be
executed under its common seal or signed on its behalf by a duly authorised
attorney or duly authorised officer of the corporation.
6 Copies of all contracts of service and letters of appointment
of any Director with the Company are available for inspection at the Company's
registered office during business hours on any weekday (Saturdays and public
holidays excluded) and will be available for inspection at the place of the
meeting 30 minutes before it is held until its conclusion.
7 A copy of this notice and other information required by s311A
Companies Act 2006 can be found at www.normanbroadbent.com. You may not use
any electronic address provided in the Notice of AGM or any related document
to communicate with the Company for any purpose other than as expressly
stated.
8 The Company, pursuant to Regulation 41 of the Uncertified
Securities Regulations 2001, specifies that only those shareholders registered
in the register of members at close of business two days priors to the meeting
shall be entitled to attend and vote, whether in person or by proxy, at the
meeting, in respect of the member of ordinary shares registered in their name
at that time. Changes to entries in the register of members after such time
shall be disregarded in determining the rights of any person to attend or vote
at the meeting. If the meeting is adjourned, entitlements to attend and vote
will be determined by reference to the register of members of the Company at
close of business two days prior to the adjourned meeting.
9 Any member attending the meeting (or viewing by Zoom) has the
right to ask questions. The Company must cause to be answered any such
questions relating to the business being dealt with at the meeting but no
answer needs to be given if to do so would interfere unduly with the
preparation for the meeting or involve the disclosure of confidential
information or if the answer has already been given on a website in the form
of an answer to a question or, finally, if it is undesirable in the interests
of the Company or the good order of the meeting that the question be answered.
10 Votes can be registered online via the registrar's website at
www.signalshares.com
(https://protect-eu.mimecast.com/s/rAB3CMZBohq3OrFJUDav?domain=signalshares.com)
.
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