REG - Velocity Composites - Interim Results

Velocity CompositesAnnouncement

26/06/2018 07:05

RNS Number : 5257S
Velocity Composites PLC
26 June 2018
 


26 June 2018
 
VELOCITY COMPOSITES PLC
("Velocity" or the "Company")
 
Interim Results for the six months ended 30 April 2018
 
Velocity Composites plc, the leading supplier of advanced composite material kits, providing engineering value-solutions for the global aerospace industry, is pleased to announce its interim results for the six months ended 30 April 2018.
 
Highlights
Financial
 
·     Continued revenue growth up 25% to £11.6m (H1 FY17 £9.3m)
·     Gross profit delivered a contribution of £1.8m (H1 FY17 £1.9m)
·     Overall gross margin for period of 15.2%, with continued improvements resulting in gross margin in April of 18.2%
·     Operating loss of £919k (H1 FY17 £208k), reflecting continued investment in international growth
·     At 30 April 2018, cash on balance sheet of £5.8m, net cash of £4.2m
 
Operational
 
·     NADCAP special process accreditation in March 2018 for Composites scope KSP (Kitting Service Provider)
·     Long term agreement with existing customer for Boeing 737 Max programme through to December 2021
·     Long term agreement with new European customer for LEAP engines for Airbus A320 NEO and Boeing 737 Max programmes through to December 2020
 
Outlook
 
·     Board remains confident of meeting the market's revised full year expectations, subject to customer demand fluctuations
·     Customer and programme pipeline remains strong with over 60% of FY19 revenue market expectations and over £60m of business for the remainder of FY18 through to FY20 under contract
 
 
Jon Bridges, Chief Executive Officer of Velocity said:
"The six months ended 30 April 2018 have seen growth during a period for the industry incorporating a significant degree of consolidation and corporate change, with the resultant delays in contract award experienced by the Company, as previously announced.   We continue to successfully execute our growth strategy through delivering new contract wins and look to progress new manufacturing sites in Europe and further afield."
 
"The first half of the year has seen growing demand for our services as the aerospace composites industry continues to look to "make more for less", and hence our customers look for new ways to reduce the cost of manufacture, both in the supply chain and their own manufacturing areas. The gross profit contribution in the period reflects the onboarding of new programmes and customer consumption experienced, with a recovering position in recent months, which was reflected in the revised market forecasts."
 
"We continue to work through and respond to Request For Quotations ("RFQs") from a range of large, global new and existing customers.  Velocity has a clear strategy to capitalise on this growth opportunity and as such, the Board remains confident of meeting the market's revised full year expectations, subject to customer demand fluctuations."
 
The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.  Upon the publication of this announcement via regulatory news service this inside information is now considered to be in the public domain.
 
Ends

 
CONTACT DETAILS:




Velocity
Jon Bridges, CEO
Alan Kershaw, CFO


c/o Camarco
Tel: 020 3757 4980




 
finnCap (Nominated Adviser and Broker)
Adrian Hargrave / Scott Mathieson / Hannah Boros (Corporate Finance)
Tim Redfern (ECM)


 
Tel: 020 7220 0500




 
Camarco (Financial PR)
Georgia Edmonds / Owen Roberts / James Crothers


 
Tel: 020 3757 4980




 
About Velocity Composites
Velocity Composites is a manufacturer of advanced composite material kits for the aerospace industry, delivering engineered waste reduction solutions for its customers to build aircraft components using less time and material. The Company's customers include multi-national manufacturers of composite parts and assemblies, who in turn deliver to the world's leading civil and military aircraft manufacturers. The Airbus A320, A330, A350, A380, Eurofighter Typhoon, F35 Joint Strike Fighter and Boeing 737, 787 and V22 Osprey are all constructed using parts manufactured from Velocity's kits. The Company's business model reduces the operating costs of preparing composite materials ahead of their usage in the construction of an aircraft part and as such, its offering is disposed to being self-financing for aircraft parts' manufacturers. Velocity's services are seeing increased demand as the global aircraft industry enters a more-for-less era. Velocity currently has customers in the UK and Continental Europe.
For further information please visit: http://www.velocity-composites.com/ 
 
Chairman's Statement
During the first half of this financial year, Velocity made significant progress with revenue ahead by 25% as compared to the same period last year, despite having suffered from delays to contract awards. The gross margin was affected by unforeseen customer changes and the onboarding of multiple programmes across our UK sites. These matters have been addressed and the gross margin recovery is underway and our UK sites are also set to benefit from new contractual wins, increasing their throughput and efficiency.
Financial Highlights
The revenue outturn for the six months ended 30 April 2018 was £11.6m (H1 FY17: £9.3m) representing an increase of 25% and gross profit has decreased to £1.8m (H1 FY17: £1.9m) being a decrease of 9%, in the quieter half of our financial year. Loss before tax has increased to £987k (H1 FY17: £299k) and the EPS loss has reduced to 2.3p (H1 FY17 restated: 1.4p) as a result of continued investment.
Our net cash remains adequate at £4.2m and provides us with the resources we need to continue to implement our growth strategy.
Business Model
The Business Development Team alongside New Product Development have been appointed and a reorganisation to focus on both gross margin and revenue growth has been undertaken. In addition, our intention remains to open a European Research and Development Centre which will allow us to develop new products and services, and respond to more customer opportunities in less time.
Board and People
The Board remains committed to operating to high standards of corporate governance, as we believe that doing so will contribute to the delivery of long term shareholder value.  The aerospace market also requires Velocity to operate on a Right First Time Every Time basis and hence the Company remains committed to governance, quality and transparency.
I would like to thank everyone for their continued hard work and commitment to Velocity Composites' success during the period.  I very much look forward to working with the whole team as we continue to grow the business and within that, helping to provide more challenging and even more rewarding roles for everyone.
Lastly, on behalf of the whole Company, I would like to place on record our thanks for the significant and tireless contribution made by Peter Turner who has been with the Company for ten years, initially as Chairman and latterly Non-Executive Director. Peter's guiding hand has been invaluable to the three founders and with his experience, wisdom and challenge, Velocity has grown into a successful enterprise from the kernel of an idea. We wish Peter a long, restful and healthy retirement.
Outlook
We have excellent and committed staff, a high-quality client base, operate on growing aircraft platforms within the expanding aerospace composites market and with our clear focus on growth and with our supportive shareholder base, the Board remains positive about the Company's prospects.
 
 
 
Mark Mills
Chairman
25 June 2018
 
 
Chief Executive Officer's Report
The six months ended 30 April 2018 have seen continued growth during a period for the industry incorporating a significant degree of consolidation and corporate change, with the resultant delays in contract award experienced by the Company.  We continue to successfully execute our growth strategy through delivering new contract wins and look to progress new manufacturing sites in Europe and further afield.
The first half of the year has seen growing demand for our services as the aerospace composites industry continues to look to "make more for less" and hence our customers look for new ways to reduce the cost of manufacture, both in the supply chain and their own manufacturing areas. The gross profit contribution in the period reflects the onboarding of new programmes and customer consumption experienced, with a recovering position in recent months, which was reflected in the revised market forecasts.
We continue to work through and respond to Request For Quotations ("RFQs") from a range of large, global new and existing customers.  Velocity has a clear strategy to capitalise on this growth opportunity and as such, the Board remains confident of meeting the market's revised full year expectations, subject to customer demand fluctuations.
Strategy
At Velocity, we partner with our customers and use our industry knowledge, business processes and proprietary software to reduce the amount of raw material and process time needed by our customers to manufacture composite parts, whilst at the same time allowing our customers to outsource a significant area of non-value added activity from their business. This in turn makes the supply chain more efficient and less expensive for our customers within the aerospace composites industry and allows them to focus on their core business of manufacturing, testing and assembling composite structures. This subsequently enables aircraft manufacturers to reduce costs and increase production rates, allowing our customers to more readily meet the significant increases in aircraft build rates.
 
Since our IPO in May 2017 we have enhanced our market intelligence, identified and visited a number of key aerospace manufacturing clusters in EMEA where we believe we can replicate our business model. We have subsequently engaged with targeted launch customers in new territories and the next stage is to partner with them, win business and open facilities when tactically necessary.
Operational review
Trading has been in line with revised market expectations and revenue has increased by 25% from the same period in FY17 as new programmes and our newest facility deliver revenue to the business.
Plans for new sites are being progressed and customers are being worked with closely to ensure that firstly, the Velocity service will reduce their costs and provide tangible benefits, and secondly, Velocity can still generate appropriate gross margin given its ability to use less material and labour to provide the requisite kits for its customers. At the same time, the Company needs to safeguard itself against currency fluctuations, the uncertainty surrounding Brexit, customer dependency and delays to aircraft programmes and therefore, is being careful in its selection of new sites, whilst remaining confident that its own growth ambitions can be achieved, profitably, in the long term. 
Importantly, as the Company gathers momentum, the amount of contracted work continues to increase and now stands at over £60m. Whilst it is frustrating that the time horizon for contractual wins has been pushed outwards, Velocity's service continues to deliver cost, time and labour savings to our aerospace customers and has resulted in significant awards during the period and since the period end with highlights including:
•           The award of Nadcap Special Process accreditation in March 2018 for Composites scope KSP (Kitting Service Provider), for demonstrating ongoing commitment to quality by satisfying customer requirements and industry specifications and which is significant as it opens up opportunities on aircraft types for which Velocity had no prior approval
•           The award of a Long-Term Agreement to supply complex design consumable kits for the Boeing 737 Max programme from an existing customer which extends to 31 December 2021 with a contract value of £3m. These composite material kits will be produced in Velocity's Fareham site and used by Velocity's customer for the wing construction on the Boeing 737
•           The award of a Long-Term Agreement to supply composite material kits to a new European Tier 1 engine manufacturer for Airbus A320 NEO and Boeing 737 MAX platforms. This agreement runs to 31 December 2020 with a contract value of up to $6m
Financial performance overview
·          Revenue continued to strengthen, up 25% to £11.6m (H1 FY17: £9.3m) and gross profit delivered a contribution of    £1.8m (H1 FY17: £1.9m).
·            Operating loss of £919k (H1 FY17 restated: £208k) and loss before tax of £987k (H1 FY17 restated: £299k) were lower following the continued investment arising from the Company's listing, additional sites and growth strategy.
·            Net cash of £4.2m (Oct 2017: £4.3m; both excluding finance lease obligations) remains adequate for our current growth plans.
Risk
In preparing these interim financial statements, management are required to make accounting assumptions and estimates. The assumptions and estimation methods are consistent with those applied to the Annual Report and financial statements for the year ended 31 October 2017. The principal risks and uncertainties that may have a material impact on activities and results of the Group remain materially unchanged from those described in the Annual Report.
For many businesses, the ongoing negotiations between the United Kingdom and European Union for its future relationship give cause for uncertainty and concern.  Whilst the present uncertainty is a natural cause for concern, the aerospace sector is a global market which unlike many other sectors is largely tariff free.  The UK is the second largest aerospace market in the world and works in global alliance on long term projects which last for many years.  For Velocity, its strategy remains to be country agnostic and to co-locate in aerospace clusters alongside its customers, which helps to mitigate some of the risk that Brexit may otherwise bring to the Group.
Outlook
The customer and aircraft programme pipeline remains strong as customers look to reduce costs and simplify the supply chain. The message from the industry around waste / cost reduction continues to be reinforced by the primes looking to be able to deliver more for less in order to meet the order backlog and market dynamics.
As the customer base increases and the number of multi-site customers grow the Board sees further opportunity to meet customers' requirement wherever they operate and to offer intra-customer optimisation across all their sites wherever they are located.
We have had a solid start to the year and the Board remains confident of meeting the revised market forecasts for the full year, subject to customer demand fluctuations.  We have the right team, strategy and offering in place to continue to strengthen our market leading position as supplier of total composite material kits to the aerospace sector and to create value for all of our shareholders and customers.
 
 
 
 
Jonathan Bridges
Chief Executive Officer
25 June 2018
 
Condensed consolidated statement of total comprehensive income
For the six months ended 30 April 2018
 
 




 
 


 


Half year ended
30 April
2018
(unaudited)


Half year ended
30 April
2017
(restated - unaudited)


Year ended
31 October
2017
(audited)




 


Note


£'000


£'000


£'000




 


 


 


 


 




Revenue


3


11,622


9,327


21,369




Cost of sales


 


(9,856)


(7,388)


(17,438)




 


 


 


 


 




Gross profit


 


1,766


1,939


3,931




Administrative expenses excluding exceptional costs


 


(2,694)


(1,894)


(3,481)




Exceptional administrative expenses


 


-


(264)


(931)




Other operating income


 


9


11


21




 


 


 


 


 




Operating loss


 


(919)


(208)


(460)




Finance expense


 


(68)


(91)


(167)




 


 


 


 


 




Loss before tax from continuing operations


 


(987)


(299)


(627)




Income tax income / (expense)


 


175


(10)


(73)




 


 


 


 


 




Loss for the period and total comprehensive loss


 


(812)


(309)


(700)




 


 


 


 


 




Losses per share - Basic (pence per share) from continuing operations


4


(2.3p)


(1.4p)


(2.5p)




 


 


 


 


 




Losses per share - Diluted (pence per share) from continuing operations


4


(2.3p)


(1.4p)


(2.5p)




 


 


 


 


 




.
Condensed consolidated statement of financial position
At 30 April 2018




 


 


As at
30 April
2018
(unaudited)


As at
30 April
2017
(restated - unaudited)


As at
31 October
2017
(audited)




 


Note


£'000


£'000


£'000




Non-current assets


 


 


 


 




Intangible assets


 


355


-


317




Property, plant and equipment


 


1,123


1,059


1,083




Total non-current assets


 


1,478


1,059


1,400




 


 


 


 


 




Current assets


 


 


 


 




Inventories


 


2,982


2,777


3,266




Trade and other receivables


 


4,781


3,854


6,148




Corporation tax


 


-


19


-




Cash and cash equivalents


 


5,754


504


5,414




Total current assets


 


13,517


7,154


14,828




 


 


 


 


 




Total assets


 


14,995


8,213


16,228




 


 


 


 


 




Current liabilities


 


 


 


 




Trade and other payables


 


5,266


6,934


5,623




Grant income deferred


 


13


32


22




Corporation tax


 


-


-


35




Net obligations under finance leases


 


132


164


145




Total current liabilities


 


5,411


7,130


5,825




 


 


 


 


 




Non-current liabilities


 


 


 


 




Deferred tax liabilities


 


-


97


106




Net obligations under finance leases


 


225


357


211




Total non-current liabilities


 


225


454


317




 


 


 


 


 




Total liabilities


 


5,636


7,584


6,142




 


 


 


 


 




Net assets


 


9,359


629


10,086




 


 


 


 


 




Equity attributable to equity holders of the company


 


 


 


 




Share capital


5


89


58


89




Share premium


 


9,727


13


9,727




Share-based payments reserve


 


452


264


367




Retained earnings


 


(909)


294


(97)




 


 


 


 


 




Total equity


 


9,359


629


10,086




 
The notes on pages 11 to 12 form part of this interim report.
 
The financial statements were approved and authorised for issue by the Board of Directors on 25 June 2018 and were signed on its behalf by
 
 
 
 
Alan Kershaw
Company Secretary       Co No: 06389233
 
Condensed consolidated statement of changes in equity
For the six months ended 30 April 2018
 




 


 


Share


Share


Retained


Share-based payments


Total




 


 


capital


premium


earnings


Reserve


equity




 


Note


£'000


£'000


£'000


£'000


£'000




 


 


 


 


 


 


 




As at 31 October 2016


 


-


-


603


-


603




Loss for the period (restated)


 


-


-


(309)


-


(309)




 


 


 


 


 


 


 




 


 


-


-


294


-


294




Transactions with shareholders:


 


 


 


 


 


 




Issue of ordinary share capital


 


58


13


-


-


71




Share-based payments (restated)


 


-


-


-


264


264




 


 


 


 


 


 


 




As at 30 April 2017


 


58


13


294


264


629




Loss for the period


 


-


-


(391)


-


(391)




 


 


 


 


 


 


 




 


 


58


13


(97)


264


238




 


 


 


 


 


 


 




Transactions with shareholders:


 


 


 


 


 


 




Issue of ordinary share capital


 


31


10,399


-


-


10,443




Share-based payments


 


-


-


-


103


103




Costs associated with issue of equity (from the AIM listing)


 


-


(685)


-


-


(685)




 


 


 


 


 


 


 




As at 31 October 2017


 


89


9,727


(97)


367


10,086




Loss for the period


 


-


-


(812)


 


(812)




 


 


 


 


 


 


 




 


 


89


9,727


(909)


367


9,274




Transactions with shareholders:


 


 


 


 


 


 




Share-based payments


 


-


-


-


85


85




 


 


 


 


 


 


 




As at 30 April 2018


 


89


9,727


(909)


452


9,359




 
Condensed consolidated statement of cash flows
For the six months ended 30 April 2018




 


Half year ended
30 April 2018
(unaudited)
 


Half year ended
30 April 2017
(restated - unaudited)


Year ended
31 October
2017
(audited)




 


£'000


£'000


£'000




Operating activities


 


 


 




Loss for the period


(812)


(309)


(700)




Taxation


(175)


10


73




Profit on disposal of assets


-


(3)


(3)




Finance costs


68


91


167




Amortisation of intangible assets


44


-


80




Depreciation of property, plant and equipment


152


119


263




Share-based payments


84


264


367




Grant income amortisation


(9)


(11)


(21)




 


(648)


161


226




 


 


 


 




Decrease/(Increase) in trade and other receivables


428


(912)


(3,206)




Decrease/(Increase) in inventories


284


(432)


(921)




Increase in trade and other payables


147


960


1,461




 


 


 


 




Cash generated from/(used in) operations


211


(223)


(2,440)




Income taxes received


34


-


-




 


 


 


 




Net cash inflow/(outflow) from operating activities


245


(223)


(2,440)




 


 


 


 




Investing activities


 


 


 




Purchase of property, plant and equipment


(102)


(48)


(271)




Development expenditure capitalised


(82)


-


(397)




Proceeds from disposal of property, plant and equipment


-


4


4




 


 


 


 




Net cash used in investing activities


(184)


(44)


(664)




 


 


 


 




Financing activities


 


 


 




Proceeds from issue of shares


-


71


10,501




Payment of share issue costs


-


-


(685)




Finance costs paid


(68)


(91)


(167)




Increase/(Decrease) in invoice discounting


436


787


(1,025)




Repayment of finance lease capital


(89)


(35)


(145)




 


 


 


 




Net cash generated from financing activities


279


732


8,479




 


 


 


 




Net increase in cash and cash equivalents


340


465


5,375




Cash and cash equivalents at beginning of period


5,414


39


39




 


 


 


 




Cash and cash equivalents at end of period


5,754


504


5,414




 
Notes to Interim Report
1.         General information
Velocity Composites plc (the 'Company') is a public limited company incorporated and domiciled in England and Wales. The registered office of the company is AMS Technology Park, Billington Road, Burnley, Lancashire, BB11 5UB, United Kingdom. The registered company number is 06389233.
 
In order to prepare for future expansion in the Asia region, the Company established a wholly owned subsidiary company, Velocity Composites Sendirian Berhad, which is domiciled in Malaysia.  This subsidiary company has not traded at the reporting date, but together with Velocity Composites plc, now forms the Velocity Composites Group ('the Group').
 
The Group's principal activity is that of the sale of kits of composite material and related products to the aerospace industry.
 
The condensed consolidated interim financial statements are unaudited and do not constitute statutory financial statements within the meaning of Section 435 of the Companies Act 2006.  The review report on these interim financial statements is set out on page 13.  The financial information for the year ended 31 October 2017 has been derived from the published statutory financial statements for the Company.  A copy of the full accounts for that period, on which the auditor issued an unmodified report that did not contain statements under Section 498(2) or 498(3) of the Companies Act 2006, has been delivered to the Registrar of Companies.  The financial results for the period ended 30 April 2017 have been restated to reflect a share based payment charge relating to the first half of that year which was included in the full year accounts.
 
These interim financial statements will be posted to the Company's shareholders and are available from the Registered Office at AMS Technology Park, Billington Road, Burnley, Lancashire, BB11 5UB or from our website at www.velocity-composites.com.
 
2.         Accounting policies
 
Basis of preparation
These condensed consolidated interim financial statements are for the six months ended 30 April 2018.  This interim financial report has been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union, and has been prepared using consistent accounting policies as applied in the Company's full year accounts to 31 October 2017 and as expected to be applied in the full year accounts to 31 October 2018. They have therefore been prepared in compliance with the measurement and recognition criteria of IFRS as adopted by the European Union.
 
These financial statements have been prepared on a going concern basis and using the historical cost convention, as modified by the revaluation of certain items, as stated in the accounting policies. These policies have been consistently applied to all periods presented, unless otherwise stated.
 
The financial statements are presented in sterling and have been rounded to the nearest thousand (£'000).
 
Going concern
Having made reasonable enquiries, the Directors are of the opinion that the Company has sufficient resources to continue in operational existence for the foreseeable future and hence these financial statements have been prepared on a going concern basis.  This assessment has been supported by the preparation and consideration of forecasts and projections through to 31 October 2020 to project the future growth of the Company, and flexing these forecasts through sensitivity analyses.
 
The forecasts include consideration of the cash position of the Company and the appropriate utilisation of the various facilities available for funding this growth. We have also discussed with our bankers and other financial advisers the resultant trading performance and they have indicated a strong desire to continue to support the funding of these growth activities.
3.         Segmental analysis
 
The Group supplies a single range of kitted products into a single industry and so has a single segment. Additional information is given below regarding the revenue receivable based on geographical location of the customer.
 




 


Half year ended
30 April 2018 (unaudited)


Half year ended
30 April 2017 (unaudited)


Year ended
31 October
2017 (audited)




 


£'000


£'000


£'000




Revenue


 


 


 




United Kingdom


11,552


9,225


21,225




Europe


70


102


144




 


 


 


 




 


11,622


9,327


21,369




 
One customer of the Group is responsible for over 10% of the total revenue in each of the periods presented.  The majority of revenue arises from the sale of goods. Where engineering services form a part of revenue it is only in support of the development or sale of the goods.
 
4.         (Losses)/earnings per share




 


Half year ended
30 April 2018 (unaudited)


Half year ended
30 April 2017 (restated - unaudited)


Year ended
31 October
2017 (audited)




 


£


£


£




 


 


 


 




Loss for the period


(812,000)


(309,000)


(700,000)




 


 


 


 




Loss per share (pence per share) (basic and diluted)


(2.3p)


(1.4p)


(2.5p)




 


 


 


 




 


Shares


Shares


Shares




 


 


 


 




Weighted average number of shares in issue


35,795,539


21,990,915


28,378,444




Share options


638,200


-


638,200




Weighted average number of shares (diluted)


36,433,739


21,990,915


29,016,644




 
Share options have not been included in the Diluted calculation as they would be anti-dilutive with a loss being recognised.
 
5.         Share capital of the Company




 


Half year ended
30 April
2018 (unaudited)


Half year ended
30 April 2017 (unaudited)


Year ended
31 October
2017 (audited)




 


£


£


£




Share capital issued and fully paid


89,489


58,812


89,489




 


 


 


 




Ordinary shares of £0.0025 each


35,795,539


23,524,800


35,795,539




 
Ordinary shares carry the right to one vote per share at general meetings of the Company and the rights to share in any distribution of profits or returns of capital and to share in any residual assets available for distribution in the event of a winding up.
 
Independent Review Report to the members of Velocity Composites plc
Introduction
We have been engaged by the Group to review the condensed set of financial statements in the half-yearly financial report of Velocity Composites PLC for the six months ended 30 April 2018 which comprises consolidated statement of total comprehensive income, consolidated statement of financial position, consolidated statement of changes in equity, consolidated statement of cash flows and the related notes. We have read the other information contained in the half-yearly financial report which comprises the Highlights, Chairman's Statement and Chief Executive Officer's Report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.
 
This report is made solely to the Group, in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board. Our review work has been undertaken so that we might state to the Group those matters we are required to state to it in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Group for our review work, for this report, or for the conclusion we have formed.
 
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the directors.
 
As disclosed in note 2, the annual financial statements of the Group are prepared in accordance with International Financial Reporting Standards as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union.
 
Our responsibility
Our responsibility is to express a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.
 
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
 
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 April 2018 is not prepared, in all material respects, in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union.
 
 
 
 
 
Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
Manchester
25 June 2018
 
 
 




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