REG - Wynnstay Group PLC - Interim Results
28/06/2022 07:01
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RNS Number : 3633Q Wynnstay Group PLC 28 June 2022
28 June 2022
AIM: WYN
Wynnstay Group Plc
("Wynnstay" or the "Group" or the "Company")
Interim Results for the Six Months ended 30 April 2022
Record interim results driven by strong sector backdrop and significant
one-off gains
KEY POINTS
Financial
· Record interim results, ahead of original management expectations, driven by:
- firm market backdrop, with strong farmgate prices boosting farmer sentiment
- significant one-off gains from fertiliser blending activities at Glasson,
caused by sharply rising natural gas prices
· Revenue up 34% to £335.66m (2021: £249.71m), with significant inflation -
accounted for c.£80m of the rise
- £6.4m first contribution from Humphrey acquisition, completed in March 2022
· Underlying pre-tax profit*up 85% to £10.21m (2021: £5.53m)/ Reported PBT up
78% to £9.56m (2021: £5.36m)
· Basic earnings per share, including non-recurring items, up 71% to 36.99p
(2021: 21.62p)
· Net debt at 30 April 2022 on a pre-IFRS 16 basis increased to £7.62m (30
April 2021: £0.75m net cash), reflecting acquisition funding and higher
working capital requirements due to inflation
· Net assets up 10.5% to £111.68m/£5.50 per share at period end (30 April
2021: £101.05m/£5.05 per share)
· Interim dividend up 8.0% to 5.40p (2021: 5.00p)
Operational
· Acquisition of the Humphrey businesses completed in March 2022 for initial
payment of £9.5m
- in line with strategy to expand poultry feed manufacturing capacity for the
growing free-range egg sector and immediately earnings enhancing
- extends Group's geographic trading area into the South, the Midlands and South
Wales
- opportunity to redevelop mothballed Calne mill into modern, multi-species feed
mill to support further expansion
· Agriculture Division - revenue up 45% to £263.03m (2021: £180.72m),
operating profit before non-recurring items up 176% to £6.06m (2021: £2.20m)
- Glasson contribution significantly ahead due to one-off stock price gains from
fertiliser blending activities
- feed volumes up 3.25%, ahead of sector average, with good growth in target
markets
- grain trading volumes up 50%, reflected return to more normalised harvest and
good autumn planting season. Lower spring cereal and grass seed sales, in line
with sector
· Specialist Agricultural Merchanting Division - revenue up 5% to £72.63m
(2021: £68.88m), operating profit before non-recurring items up 26% to
£4.28m (2021: £3.40m)
- favourable sales mix on lower total volumes; strong sales of bagged feed,
animal health care and hardware products
- efficiency improvements helped drive higher profitability
Outlook
· Trading conditions remain positive - underpinned by firm farmgate prices
· Board believes Group is well-placed to achieve growth prospects for the full
year; exceptional gains of H1 not expected to be repeated in H2
- Group remains focused on acquisitions in key target areas
*Underlying pre-tax profit is a non-GAAP (generally accepted accounting
principles) measure and is not intended as a substitute for GAAP measures and
may not be calculated in the same way as those used by other companies. Refer
to Note 6 for an explanation on how this measure has been calculated and the
reasons for its use.
Gareth Davies, Chief Executive of Wynnstay Group plc, commented:
"These record interim results have been underpinned by a favourable sector
backdrop, with strong farmgate prices across most sectors and positive farmer
sentiment, as well as significant one-off gains in our fertiliser blending
activity.
"The acquisition of Humphrey Feeds and Pullets is exciting. It significantly
extends our geographic reach and opens up new growth opportunities.
"While there are still challenges with cost inflation and supply chain
pressures, sector sentiment remains strong, and we are confident about
achieving our growth goals for the full year."
Enquiries:
Wynnstay Group Plc Gareth Davies, Chief Executive T: 020 3178 6378 (today)
Paul Roberts, Finance Director T: 01691 827 142
KTZ Communications Katie Tzouliadis / Dan Mahoney T: 020 3178 6378
Shore Capital (Nomad and Broker) Stephane Auton / John More T: 020 7408 4090
CHAIRMAN'S STATEMENT
INTRODUCTION
We are pleased to report record interim results, with underlying pre-tax
profit up by 85% to £10.21m* (2021: £5.53m) and revenue up 34% to £335.66m
(2021: £249.71m). Reported pre-tax profit increased by 78% to £9.56m
(2021: £5.36m).
These excellent results are ahead of our original expectations, and reflect a
strong trading backdrop, supported by buoyant farmgate prices across most
categories, which boosted farmer sentiment and farm investment. There were
also unexpected one-off gains at our fertiliser blending activity at Glasson.
This was created by sharply rising fertiliser prices as a result of the
significant increases in the world price of natural gas, which is used in the
production of ammonium nitrate fertiliser. Fertiliser prices have fallen
slightly from their high point in March, and we do not anticipate these
one-off gains to be repeated.
There was widespread inflationary pressure in the period, which was
exacerbated by the Russian invasion of Ukraine in late February and the
ensuing sanctions imposed on Russia. Certain energy and soft commodity prices
reached levels not seen globally for several decades. In the UK, wheat and
fertiliser prices reached record levels in March. While this dampened some
demand, the effect of inflation on Group revenues has been significant.
Operational conditions in the period continued to be affected by the
Coronavirus pandemic, in particular the high infection rates associated with
the Omicron variant and the inconsistency of supply of certain products.
Thanks to the efforts of our teams and wide sourcing network, this did not
affect customer service levels or product provision. The working environment
has now largely normalised following the lifting of Government restrictions,
and we remain ready to react to any new guidance.
A major highlight in the first half was the acquisition in March 2022 of
Humphrey Feeds Ltd, a manufacturer and supplier of poultry feed, and Humphrey
Pullets Ltd, which supplies point-of-lay pullets ("Humphrey"). Both businesses
are based in Hampshire and mainly supply farmers in the South of England, as
well the Midlands and South Wales. The provisional assessed consideration for
the acquisition was £13.2 million, with an initial £9.5 million paid in cash
at completion. This highly complementary acquisition is in line with the
Board's strategic plans to expand the Group's poultry feed manufacturing
capacity for the free-range egg sector, a growing market, and extend the
Group's geographic trading area. As previously reported, we expect the
Humphrey acquisition to enhance earnings this financial year. In order to fund
the acquisition, the Company entered into a new £12.5m revolving credit
facility. Further details about the business and our plans to develop the
opportunities it brings are provided further on in the report. We are
delighted to welcome our new colleagues and customers to the Group, and are
pleased to report that the business is bedding in well, as expected.
These trading results continue to demonstrate the benefits of our balanced
business model, supplying products to both livestock and arable farming
enterprises. Our investment programmes across the Group are progressing, with
substantial projects under way in our feed and seed operations. The trading
outlook for the second half remains very positive and we expect to make
further good progress in the second half.
FINANCIAL RESULTS
First half results for the six months ended 30 April 2022 have been
significantly affected by rising commodity prices, which have increased
revenues and created one-off raw material gains in fertiliser blending.
Revenue increased by 34% on the same period last year to £335.66m (2021:
£249.71m), with commodity price inflation accounting for an estimated
£80.00m of the overall increase. The Humphrey acquisition, completed in
mid-March 2022, contributed £6.4m to Group revenues. Revenue generated by the
Agriculture Division increased by 45% to £263.03m (2021: £180.72m) while the
Specialist Agricultural Merchanting Division generated a 5% increase at
£72.63m (2021: £68.88m).
Adjusted operating profit, which is before non-recurring costs, share-based
payments and intangible amortisation, rose by 84% to £10.43m (2021:
£5.68m). The Agricultural Division contributed operating profit of £6.06m
(2021: £2.20m), up by 176% by comparison with the same period last year. This
result included the one-off stock profits from fertiliser blending. The
Specialist Agricultural Merchanting division contributed operating profit of
£4.28m (2021: £3.40m). This 26% increase mainly reflected improved margins,
driven partly by efficiencies. Other activities incurred a slight operating
loss of £0.07m (2021: loss of £0.12m). As in prior years, the contribution
from our Joint Ventures will be consolidated in the second half of our full
year results.
Non-recurring costs charged in the period amounted to £0.52m and related to
the transaction and funding costs of the Humphrey acquisition (2021: Nil). Net
finance costs, including IFRS 16 charges, totalled £0.19m (2021: £0.11m),
and reflected the new loans drawn to fund the acquisition. Share-based payment
expenses for the period decreased to £0.13m (2021: £0.16m).
Underlying pre-tax profit, which excludes share-based payments and
non-recurring items, increased by 85% to £10.21m* (2021: £5.53m). Reported
profit before tax increased by 78% to £9.56m (2021: £5.36m). The effective
tax rate for the period was higher than the same period last year at 21.4%
(2021: 19.1%). This was because deferred tax rates were adjusted to recognise
the future increase in the Corporation Tax rate to 25% from April 2023, and
has resulted in a charge of £2.05m (2021: £1.03m). Profit after tax
increased by 73% to £7.51m (2021: £4.34m), and basic earnings per share
increased by 71% to 36.99p (2021: 21.62p).
Net assets at 30 April 2022 stood 10.5% higher year-on-year at £111.68m (30
April 2021: £101.05m) and equates to £5.50 per share (30 April 2021: £5.04
per share), based on the weighted average number of shares in issue during the
period at 20.31m (2021: 20.06m).
Net debt on a pre IFRS 16 basis (excluding property leases) increased to
£7.62m at 30 April 2022 from a 2021 equivalent position of £0.75m net cash.
The rise reflected both acquisition funding and significantly higher working
capital requirements resulting from the substantial commodity price inflation.
Working capital in any given year typically peaks around the April interim
period end, reducing over the second half. Total Right of Use property lease
liabilities amounted to £5.13m (2021: £5.60m) resulting in reported
accounting net debt of £12.75m (2021: £4.85m).
DIVIDEND
The Board is pleased to declare an increased interim dividend of 5.40p per
share (2021: 5.00p), up by 8.0% on the equivalent payment last year. The
increased payment reflects both the strong results and the Directors
continuing confidence in growth prospects.
The interim dividend will be paid on 31 October 2022 to shareholders on the
register at the close of business on 30 September 2022. As in previous years,
the Scrip Dividend alternative will continue to be available, with the last
day for election for this scheme being 14 October 2022.
REVIEW OF OPERATIONS
AGRICULTURE DIVISION
Strong farmgate prices for most agricultural produce has continued to underpin
sector sentiment despite farm costs also rising, particularly for fuel and
energy. Prices for beef, lamb, and especially grain in the first half were
significantly ahead of the same period last year, with milk prices also
firm. Egg prices were generally flat, although they have been increasing
since April.
Feed Products
Feed volumes rose on a like-for-like basis by 3.25% over the same period last
year and were above the average growth rate in the sector. We increased
volumes in key target areas, including dairy, poultry and sheep feed,
supported by our strategy of increasing the number of our on-farm sales
specialists.
Rising raw material and operating costs, including labour, energy and
packaging, continued to put pressure on margins. Nonetheless, the feed
division performed well, although its operating margin was slightly lower than
the same period last year.
The acquisition of the Humphrey business opens up significant future growth
opportunities for the Group. While it immediately adds additional poultry feed
manufacturing capacity from a leased facility in Twyford in Hampshire, there
is scope to redevelop its currently moth-balled freehold site at Calne in
Wiltshire to create a modern, multi-species mill, manufacturing both poultry
and ruminant feed. This would give us a strategically well-located feed
manufacturing facility and enable us to extend our trading footprint in the
South of England, including in the South West. In addition, once operational,
the Calne mill would also enable us to efficiently develop local growth
opportunities at Llansantffraid and Carmarthen by transferring some production
capacity at these feed mills to the Calne facility. We also plan to extend
sales of other Wynnstay products and services to the new farmer customer base
that we have gained with the acquisition. The Humphrey business made a
first-time contribution to poultry feed sales in line with our expectations.
Arable Products
The Arable operations have been the most affected by the geopolitical factors
that have driven raw material prices higher and increased operating costs.
Nonetheless, these have been managed well.
The volume of grain traded by GrainLink, our grain marketing business, was
substantially ahead of the same period in the last financial year, increasing
by 50%. This increase largely reflected a return to more normal harvest
tonnages and yields in 2021 compared with the exceptionally poor harvest in
2020, and volume gains made in our Eastern operations, following new business
wins generated by the expansion of dedicated resource in this area. One impact
of rising crop prices has been the need to meet very significant margin calls
on forward grain hedging contracts. We use these contracts to provide an
effective hedge between our grain purchases from farmers and subsequent sales
to food manufacturers. Forward positions will unwind over the course of the
next six months as the physical grain is delivered and these contracts unwind.
The Autumn seed planting season was strong, and good growing conditions since
then bode well for the forthcoming 2022 harvest and grain trading volumes.
With a good Autumn planting season, the spring-sown cereal crops acreage was
reduced, and grass seed sales were also lower than the comparative period last
year partly due to the very dry weather in March and April 2022. However, both
our spring cereal and grass seed sales are in line with sector averages.
The volume of fertiliser traded within Wynnstay Agriculture Supplies decreased
by some 26% compared with the equivalent period last year, a reflection of
elevated fertiliser prices. This compares with industry contraction of about a
third, and improved margins have more than balanced the reduced tonnage.
Glasson Grain Limited ("Glasson")
Glasson operates in three main areas; feed raw materials, fertiliser
production and the manufacture of specialist animal feed products.
As discussed earlier, the contribution to Group results from Glasson
significantly exceeded our original expectations. This was driven by our
fertiliser blending activity, which experienced one-off stock price gains as
the price of fertiliser rose, reflecting the highly-disrupted natural gas (a
key ingredient) market. We have developed the fertiliser manufacturing
business and assets of HELM Great Britain Limited, purchased in March 2021,
building up its book of customers and establishing a good working relationship
with our existing fertiliser facility in nearby Goole. The feed raw materials
activity performed in line with expectations. Volumes in Glasson's smallest
activity, specialist feed manufacturing, decreased reflecting more difficult
end-markets.
SPECIALIST AGRICULTURAL MERCHANTING DIVISION
Specialist Agricultural Merchanting and Youngs Animal Feeds
The Group's chain of 54 depots caters for the needs of farmers and other rural
dwellers and operates very closely with the Agricultural Division, providing a
strong channel to market for our products.
The operating profit contribution from this activity was well ahead of last
year, helped by positive farmer confidence, a favourable mix of sales, and the
cumulative benefits of the efficiency improvements that have been implemented
across the business. The depots saw good sales of higher margin bagged feed,
animal health care products and the more discretionary items in the hardware
categories, although total sales, excluding inflation, were slightly down on
the same period in the prior financial year.
We continued to develop our digital offering and some 1,800 accounts are now
signed up to our customer portal, which enables customers to access their
Wynnstay account and place orders online.
Youngs, our specialist equine feeds operation, delivered a profitable
contribution to this division, although like the rest of the equine sector, it
experienced volume and margin pressures.
JOINT VENTURES AND ASSOCIATES
Results from the Group's joint ventures and associate companies are not
included in this half year report, and in accordance with established policies
will be consolidated into Wynnstay's full year results.
ESG
In February 2021, we created a new management position, which carried specific
responsibility for leading the ongoing development and implementation of the
Group's ESG strategy. Our policies and objectives are being effectively
embedded across all of the Group's operations. We are also working with our
peers in the industry to promote increased sustainability throughout UK
agriculture, including as a member of the sustainability committee of the
agrisupply industry's leading trade association, the Agricultural Industries
Confederation (AIC). We are now seeking to establish an ESG Advisory Board
with external members in order to support future policy and planning.
A key pillar in the Group's growth strategy is supporting customers with the
advice, products, and services that are necessary to adapt to the new
environmental and efficiency priorities set in the UK Agriculture Act. Our own
focus on sustainability will strengthen our ability to support customers'
environmental aims.
OUTLOOK
World politics and the UK economy have become much more volatile and less
predictable in recent months, and we are very aware of increasing cost
pressures and international supply chain challenges. We will continue to
navigate these challenges as effectively as possible, and our balanced
business model remains a major strength. Recent world events have also
sharpened the focus on the importance of national food security, and this
should help to strengthen the position of UK agriculture. We believe we have a
significant role to play in helping to ensure that UK farmers are able to feed
the population sustainably and efficiently.
Our programme of investment at our Astley seed plant and at the Carmarthen
feed mill continues, and planning is under way for a new multi-species feed
mill at Calne, which will service farmers in the South and West of the
country.
As we look ahead and consider prospects for the second half of the financial
year, we remain very confident. The trading environment for farmers remains
well-supported by strong farmgate prices, which will help to underpin ongoing
farmer confidence and investment. However, we do not expect the significant
one-off gains experienced in the first half of the financial year to be
repeated.
We remain focused on growth opportunities, including acquisitions, and look to
the future with confidence.
Steve Ellwood
Chairman
* Note 6. Explanation of Non GAAP measure.
WYNNSTAY GROUP PLC
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 30 April 2022
Unaudited Unaudited Audited
six months ended six months ended year
30 April 2022 30 April 2021 ended
31 Oct 2021
Note £000 £000 £000
CONTINUING OPERATIONS
Revenue 335,661 249,709 500,386
Cost of sales (294,399) (216,413) (432,493)
Gross profit 41,262 33,296 67,893
Manufacturing, distribution and selling costs (27,059) (24,202) (50,072)
Administrative expenses (3,962) (3,604) (7,096)
Other operating income 5 193 185 361
Adjusted operating profit* 6 10,434 5,675 11,086
Amortisation of acquired intangible assets and share -based payment expense 7 (165) (197) (477)
Non-recurring items 7 (523) - -
Group operating profit 9,746 5,478 10,609
Interest income 25 51 193
Interest expense (211) (165) (383)
Share of profits in joint ventures and associate accounted for using the 2 - - 677
equity method
Share of tax incurred in by joint venture and associate - - (105)
Profit before taxation 9,560 5,364 10,991
Taxation 8 (2,047) (1,027) (2,057)
7,513 4,337 8,934
Profit for the period
Other comprehensive income 42 - 263
Items that will reclassified subsequently to profit or loss:
· net change in the fair value of cash flow hedges taken to equity,
net of tax
Other comprehensive income for the period 42 - 263
Total comprehensive income for the period 7,555 4,337 9,197
Basic earnings per ordinary share (pence) 36.99 21.62 44.40
Diluted earnings per ordinary share (pence) 36.07 21.30 43.53
* Adjusted operating profit is after adding back amortisation of acquired
intangible assets, share-based payment expense and non-recurring items.
CONDENSED CONSOLIDATED BALANCE SHEET
As at 30 April 2022
Unaudited Unaudited Audited
six months six months year
ended ended ended
30 Apr 2022 30 Apr 2021 31 Oct 2021
Note £000 £000 £000
ASSETS
NON-CURRENT ASSETS
Goodwill 17,465 14,417 14,322
Investment property 2,372 2,372 2,372
Property, plant and equipment 18,340 17,654 16,746
Right-of-use assets 10 9,861 10,153 11,043
Investments accounted for using the equity method 3,430 3,613 3,433
Intangibles 4,940 327 236
Derivative financial instruments - - 5
56,408 48,536 48,157
CURRENT ASSETS
Derivative financial instruments 359 227 320
Inventories 63,721 44,221 50,550
Trade and other receivables 103,254 75,180 72,511
Financial assets - loans to joint ventures 2,090 3,865 3,319
Cash and cash equivalents 11 6,112 4,991 19,641
175,536 128,484 146,341
TOTAL ASSETS 231,944 177,020 194,498
LIABILITIES
CURRENT LIABILITIES
Financial liabilities - borrowings (2,569) (979) (672)
Lease liabilities (3,685) (3,173) (3,995)
Derivative financial instruments (825) (214) (53)
Trade and other payables (96,761) (64,551) (76,212)
Current tax liabilities (1,793) (1,019) (1,218)
Provisions (351) - (243)
(105,984) (69,722) (82,393)
NET CURRENT ASSETS 69,552 58,762 63,948
NON-CURRENT LIABILITIES
Financial liabilities - borrowings (7,588) - (313) -
Lease liabilities (5,025) (5,687) (5,731)
Trade and other payables (37) (87) (38)
Deferred tax liabilities (1,629) (474) (474)
Derivative financial instruments - - (140)
(14,279) (6,248) (6,383)
TOTAL LIABILITIES (120,263) (75,970) (88,776)
NET ASSETS 111,681 101,050 105,722
EQUITY
Share capital 14 5,094 5,034 5,075
Share premium 31,989 30,998 31,600
Other reserves 4,303 3,686 4,131
Retained earnings 70,295 61,332 61,916
TOTAL EQUITY 111,681 101,050 105,722
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
For the six months ended 30 April 2022
Share Capital Share Premium Other Reserves Cash Flow Hedge Reserve Retained Earnings Total Equity
£000 £000 £000 £000 £000 £000
Balance at 1 November 2020 5,013 30,637 3,525 - 59,003 98,178
Profit for the period - - - - 4,337 4,337
Total comprehensive income for the period - - - - 4,337 4,337
Transactions with owners of the Company, recognised directly in equity
Shares issued during the period 21 361 - - - 382
Dividends - - - - (2,008) (2,008)
Equity settled share-based payment transactions - - 161 - - 161
Total contributions by and distributions to owners of the Group 21 361 161 - (2,008) (1,465)
At 30 April 2021 5,034 30,998 3,686 - 61,332 101,050
Profit for the period - - - - 4,597 4,597
Total comprehensive income for the period - - - 263 4,597 4,860
Transactions with owners of the Company, recognised directly in equity
Shares issued during the period 41 602 - - - 643
Dividends - - - - (1,013) (1,013)
Equity settled share-based payment transactions - - 182 - - 182
Total contributions by and distributions to owners of the Group 41 602 182 - (1,013) (188)
At 31 October 2021 5,075 31,600 3,868 263 64,916 105,722
Profit for the period - - - - 7,513 7,513
Total comprehensive income for the period - - - - 7,513 7,513
Transactions with owners of the Company, recognised directly in equity
Shares issued during the period 19 389 - - - 408
Dividends - - - - (2,134) (2,134)
Change in the fair value of cash flow hedges taken to equity, net of tax - - - 287 - 287
during period
Recycle cash flow hedge to Income Statement - - - (245) - (245)
Equity settled share-based payment transactions - - 130 - - 130
Total contributions by and distributions to owners of the Group 19 389 130 42 (2,134) (1,554)
At 30 April 2022 5,094 31,989 3,998 305 70,295 111,681
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
For the six months ended 30 April 2022
Unaudited Unaudited Audited
six months ended six months ended year
30 April 2022 30 April 2021 ended
31 October
2021
Note £000 £000 £000
Cash flow from operating activities
Cash (used in)/generated from operations 9 (9,316) (7,351) 10,554
Interest received 25 51 193
Interest paid (84) (165) (102)
Settlement of provision - - (96)
Tax paid (1,311) (594) (1,462)
Net cash (used in)/generated from operating activities (10,686) (8,059) 9,087
Cash flows from investing activities
Acquisition of subsidiaries and other businesses and their assets (net of cash 17 (8,572) (1,844) (2,238)
acquired)
Proceeds of sale of property, plant and equipment & ROU assets 492 95 340
Purchase of property, plant and equipment (1,418) (1,009) (1,563)
Decrease in short term loans to joint ventures 1,229 24 570
Receipt of Dividend from Unlisted Investment 2 - -
Dividends received from joint ventures - - 753
Net cash used by investing activities (8,267) (2,734) (2,138)
Cash flows from financing activities
Net proceeds from the issue of ordinary share capital 408 382 1,025
Lease payments (2,335) (1,977) (4,392)
New borrowings 9,485 - -
Repayments of loans - (593) (900)
Dividends paid to shareholders (2,134) (2,008) (3,021)
Net cash from/(used in) financing activities 5,424 (4,196) (7,288)
(13,529) (14,989) (339)
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of period 19,641 19,980 19,980
Cash and cash equivalents at end of period 11 6,112 4,991 19,641
WYNNSTAY GROUP PLC
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
GENERAL INFORMATION
Wynnstay Group Plc has a number of operations. These are described in the
segment analysis in note 4.
Wynnstay Group Plc is a company incorporated and domiciled in the United
Kingdom. The address of its registered office is shown in note 3.
1. BASIS OF PREPARATION
The Interim Report was approved by the Board of Directors on 27 June 2022.
The condensed financial statements for the six months to the 30 April 2022
have been prepared in accordance with International Accounting Standard (IAS)
34 and the Disclosure Guidance and Transparency Rules sourcebook of the UK's
Financial Conduct Authority, except as disclosed in note 3.
The financial information for the Group for the year ended 31 October 2021 set
out above is an extract from the published financial statements for that year
which have been delivered to the Registrar of Companies. The auditor's report
on those financial statements was not qualified and did not contain statements
under section 498(2) or 498(3) of the Companies Act 2006. The information
contained in this document does not constitute statutory accounts within the
meaning of section 434 of the Companies Act 2006.
The financial information for the six months ended 30 April 2022 and for the
six months ended 30 April 2021 are unaudited. The consolidated financial
statements are presented in sterling, which is also the Group's functional
currency. Amounts are rounded to the nearest thousand, unless otherwise
stated.
The condensed consolidated interim financial statements should be read in
conjunction with the annual consolidated financial statements for the year
ended 31 October 2021, which have been prepared in accordance with UK adopted
International Accounting Standards.
2. GOING CONCERN
The Directors have prepared the condensed consolidated interim financial
statements on a going concern basis, having satisfied themselves from a review
of internal budgets and forecasts and current banking facilities that the
Group has adequate resources to continue in operational existence for the
foreseeable future.
The Group has a sound financial base and forecasts that show profitable
trading and sufficient cash flow and resources to meet the requirements of the
business, including compliance with banking covenants and on-going liquidity.
In assessing their view of the likely future financial performance of the
Group, the Directors consider industry outlooks from a variety of sources, and
various trading scenarios. This analysis showed that the Group is well placed
to manage its business risks successfully despite the current uncertain
economic outlook, and the ongoing issues created by the continuing Coronavirus
concerns and the war in Ukraine which has caused significant commodity price
volatility.
In conclusion, the Directors have a reasonable expectation that the Group has
adequate resources to continue in operational existence for the foreseeable
future. Thus, they continue to adopt the going concern basis of accounting in
preparing the annual financial statements.
3. SIGNIFICANT ACCOUNTING POLICIES
The condensed financial statements have been prepared under the historical
cost convention other than shared-based payments, which are included at fair
value and certain financial instruments which are explained in the annual
consolidated financial statements for the year ended 31 October 2021.
The Group has a policy of using annual results for the consolidation of its
share of the results of joint ventures, and as such no consolidation has
occurred in these condensed financial statements which is consistent with
previous years.
The condensed consolidated interim financial statements for the six months to
30 April 2022 have been prepared on the basis of the accounting policies
expected to be adopted for the year ending 31 October 2022. These are
anticipated to be consistent with those set out in the Group's latest annual
financial statements for the year ended 31 October 2021. A copy of these
financial statements is available from the Company's Registered Office at
Eagle House, Llansantffraid, Powys, SY22 6AQ.
New standards and interpretations
New and amended standards adopted in the annual financial statements for the
year ended 31 October 2021 did not have any significant impact on those
results and changes implemented from the 1 January 2021 are similarly not
having any material impact on the Group as they are either not relevant to the
Group's activities or require accounting which is consistent with the Group's
current accounting policies.
Critical accounting estimates and judgements
The Group makes certain estimates and assumptions regarding the future. These
estimates and judgements are continually evaluated based on historic
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances. At 30 April 2022 management
have not identified any indicators of impairment within the Group. In the
future, actual experience may differ from these estimates and assumptions,
however it is believed these are not significant nor likely to cause a
material adjustment to the carrying amount of assets and liabilities within
the next financial year.
4. SEGMENTAL REPORTING
IFRS 8 requires operating segments to be identified on the basis of internal
financial information about the components of the Group that are regularly
reviewed by the chief operating decision-maker ("CODM") to allocate resources
to the segments and to assess their performance.
The chief operating decision-maker has been identified as the Board of
Directors ("the Board"). The Board reviews the Group's internal reporting in
order to assess performance and allocate resources. The Board has determined
that the operating segments, based on these reports are Agriculture,
Specialist Agricultural Merchanting, and Other.
The Board considers the business from a product/service perspective. In the
Board's opinion, all of the Group's operations are carried out in the same
geographical segment, namely the United Kingdom.
Agriculture - manufacturing and supply of animal feeds, fertiliser, seeds and
associated agricultural products.
Specialist Agricultural Merchanting - supplies a wide range of specialist
products to farmers, smallholders, and pet owners.
Other - miscellaneous operations not classified as Agriculture or Specialist
Agricultural Merchanting.
The Board assesses the performance of the operating segments based on a
measure of operating profit. Non-recurring costs and finance income and
costs are not included in the segment result that is assessed by the Board.
Other information provided to the Board is measured in a manner consistent
with that in the financial statements. No segment is individually reliant on
any one customer.
The segment results for the period ended 30 April 2022 and comparative periods
are as follows:
Unaudited for the six months ended Specialist
30 April 2022: Agriculture Agricultural Merchanting Other Total
£000 £000 £000 £000
263,034 72,627 - 335,661
Revenue from external customers
Segment results :
Group operating profit before non-recurring items 6,062 4,276 (69) 10,269
Share of result of Joint Ventures - - - -
6,062 4,276 (69) 10,269
Non-recurring items (note 7) (523)
Interest income 25
Interest expense (211)
Profit before taxation 9,560
Taxation (2,047)
Profit for the period attributable to shareholders 7,513
Unaudited for the six months ended Specialist
30 April 2021: Agriculture Agricultural Merchanting Other Total
£000 £000 £000 £000
180,716 68,884 109 249,709
Revenue from external customers
Segment results :
Group operating profit before non-recurring items 2.197 3,398 (117) 5,478
Share of result of Joint Ventures - - - -
2,197 3,398 (117) 5,478
Interest income 51
Interest expense (165)
Profit before taxation 5,364
Taxation (1,027)
Profit for the period attributable to shareholders 4,337
Audited for the year ended Agriculture Specialist Other Total
31 October 2021: Agricultural Merchanting
£000 £000 £000 £000
358,961 141.425 - 500,386
Revenue from external customers
Segment results :
Group operating profit before non-recurring items 3,697 7,120 (208) 10,609
Share of result of Joint Ventures 524 33 120 677
4,221 7,153 (88) 11,286
Interest income 193
Interest expense (383)
Profit before taxation 11,096
Taxation (including on Joint ventures) (2,162)
Profit for the year attributable to shareholders 8,934
5. OTHER OPERATING INCOME
Unaudited Unaudited Audited
six months six months year
ended ended ended
31 October 2021
30 April 2022 30 April 2021
£000 £'000 £000
Rental Income 193 185 361
6. ALTERNATIVE PERFORMANCE MEASURES
On the Board's preferred alternative performance measures referred to as
Adjusted operating profit and Underlying pre-tax profits which are
respectively, Group operating profit adding back amortisation of acquired
intangible assets, share-based payment expense and non-recurring items, and
the Group profit before tax adding back share-based payment expense,
non-recurring items and including the value of the share of tax incurred by
joint ventures and associates. On these measures the Group achieved adjusted
operating profit of £10.43m (2021: £5.68m) and underlying pre-tax profits of
£10.21m (2021: £5.53m).
Reconciliation with the reported income statement for this measure, Operating
profit before non-recurring items and Underlying pre-tax profit and the Profit
before tax shown on the Condensed Statement of Comprehensive Income, together
with reasons for their use is given below.
Unaudited Unaudited Audited
six months six months year
ended ended ended
30 April 2022 30 April 2021 31 October 2021
£000 £000 £000
Profit before tax 9,560 5,364 10,991
Share of tax incurred by joint ventures and associate - - 105
Non-recurring items (note 7) 523 - -
Net finance costs 186 114 190
Share of results from joint ventures before tax - - (677)
Operating profit before non-recurring items (note 8) 10,269 5,478 10,609
Share of results from joint ventures and associate before tax - - 677
Segment results plus share of results from joint ventures and associate before 10,269 5,478 11,286
tax (note 4)
Share-based payments 130 161 343
Net finance charges (186) (114) (190)
Underlying pre-tax profit 10,213 5,525 11,439
Unaudited Unaudited Audited
six months six months year
ended ended ended
30 April 2022 30 April 2021 31 October 2021
£000 £000 £000
Profit before tax 9,560 5,364 10,991
Share of results from joint ventures - - (677)
Share of tax incurred by joint ventures - - 105
Net finance charges 186 114 190
Share-based payments 130 161 343
Amortisation of intangibles 35 36 134
Non-recurring items (note 7) 523 - -
Adjusted operating profit 10,434 5,675 11,086
The Board uses alternative performance measures as it believes the underlying
commercial performance of the current trading activities is better reflected,
and provides investors and other users of the accounts with an improved view
of likely future performance by making adjustments to the IFRS results for the
following reasons:
• Share of results from joint ventures and associate
Provides a fuller understanding of activities directly under management
control and those incorporated from joint ventures.
• The add back of tax incurred by joint ventures and associate
The Board believes the incorporation of the gross result of these entities
provides a fuller understanding of their combined contribution to the Group
performance.
• Net finance charges
Provides an understanding of results before interest received and paid.
• Share-based payments
This charge is calculated using a standard valuation model, with the assessed
non-cash cost each year varying depending on new scheme invitations and the
number of leavers from live schemes. These variables can create a volatile
non-cash charge to the income statement, which is not directly connected to
the trading performance of the business.
• Amortisation of acquired intangible assets
This charge relates to intangible assets created from prior business
combinations, hence provides a fuller understanding of current operating
performance.
• Non-recurring items
The Group's accounting policies include the separate identification of
non-recurring material items on the face of the income statement, which the
Board believes could cause a misinterpretation of trading performance if not
disclosed.
7. AMORTISATION OF ACQUIRED INTANGIBLE ASSETS AND SHARE-BASED PAYMENTS
AND NON-RECURRING ITEMS
Unaudited Unaudited Audited
six months six months Year
ended ended ended
31 October 2021
30 April 2022 30 April 2021
£000 £000 £000
Amortisation of acquired intangible assets and share-based payments
Amortisation of intangibles 35 36 39
Goodwill impairment - - 95
Cost of share-based reward 130 161 343
165 197 477
Non-recurring items
Acquisition transaction costs 523 - -
523 - -
Acquisition transaction costs relate to the Business Combination (see note 17)
of Humphrey Poultry Holdings Limited in March 2022.
8. TAXATION
The tax charge for the six months ended 30 April 2022 and 30 April 2021 is
based on an apportionment of the estimated tax charge for the full year.
The effective tax rate is 21.4% (6 months ended 30 April 2021: 19.1%) which is
higher than the standard rate of 19.0% primarily due to adjustments to
deferred tax provisions following the Government's decision to raise the
standard rate of Corporation Tax to 25% with effect from April 2023 (2021:
19.0%).
9. CASH (USED IN)/GENERATED FROM OPERATIONS
Unaudited Unaudited Audited
six months six months ended year
30 April 2021
ended ended
31 October 2021
30 April 2022
£000 £000 £000
Profit for the period 7,513 4,337 8,934
Adjustments for:
Taxation 2,047 1,027 2,057
Investment and goodwill impairment - - 95
Depreciation of tangible fixed assets 1,109 1,042 2,165
Amortisation of other intangible fixed assets 35 36 39
Depreciation of right-use-assets 2,019 1,932 3,974
Profit on disposal of property, plant and equipment (104) (77) (86)
Profit on disposal of right-of-use asset - - (14)
Loss on relinquishment of property lease - - 26
Movement in provisions - - 193
Net interest income / (expense) 59 (24) (91)
Interest on right of use liabilities 127 138 281
Investment revaluation - (2) 2
Derivative held as Fair Value P&L FVPL 632 - 23
Government grant (1) - (2)
Share of results of joint ventures and associate - - (572)
Share-based payment expense 130 161 343
Changes in working capital (excluding effects of acquisitions and disposals of
subsidiaries)
Increase in inventories (11,028) (8,254) (14,583)
Increase in trade and other receivables (25,106) (19,557) (16,753)
Increase in trade and other payables 13,252 11,890 24,523
Cash (used in)/generated from operations (9,316) (7,351) 10,554
During the six months to 30 April 2022, the Group purchased property, plant
and equipment of £2,381,000 (2021: £1,832,000) of which £965,000 relates to
right-of-use assets (2021: £845,000).
10. LEASES
The following tables shows the movement in right-of-use assets and lease
liabilities, along with the aging of the lease liabilities.
Right-of-use assets Land and buildings Plant, machinery & motor vehicles Total
£000 £000 £000
At 1 November 2020 6,266 4,974 11,240
Additions 400 445 845
Amortisation (1,120) (812) (1,932)
At 30 April 2021 5,546 4,607 10,153
Additions 2,261 1,185 3,446
Amortisation (1,257) (785) (2,042)
Disposals (437) (77) (514)
At 31 October 2021 6,113 4,930 11,043
Additions - 965 965
Arising on acquisition of subsidiary undertakings - 210 210
Reclassification 55 (55) -
Depreciation (1,102) (917) (2,019)
Disposals - (338) (338)
At 30 April 2022 5,065 4,795 9,861
Lease liabilities Land and buildings Plant, machinery & motor vehicles Total
£000 £000 £000
At 1 November 2020 6,291 3,701 9,992
Additions 424 238 662
Interest expense 71 67 138
Lease payments (1,184) (748) (1,932)
At 30 April 2021 5,602 3,258 8,860
Additions 2,237 1,392 3,629
Interest expense 62 81 143
Lease payments (1,235) (1,225) (2,460)
Disposal (446) - (446)
At 31 October 2021 6,220 3,506 9,726
Additions - 965 965
Reclassification - 17 17
Arising on acquisition of subsidiary undertakings - 210 210
Interest expense 60 67 127
Lease payments (1,144) (1,191) (2,335)
At 30 April 2022 5,136 3,574 8,710
Within 1 year 1-2 years 2-5 years Over 5 years Total
£000 £000 £000 £000 £000
3,685 3,026 1,428 571 8,710
Lease liabilities
11. NET CASH
Unaudited Unaudited Audited
six months ended six months ended year
30 April 2022
30 April 2021
ended
31 October 2021
£000 £000 £000
Cash and cash equivalents per balance sheet 6,112 4,991 19,641
Cash and cash equivalents per cash flow statement 6,112 4,991 19,641
Bank loans due within one year or on demand (1,897) (306) -
Loan capital (672) (673) (672)
Net cash due within one year 3,543 4,012 18,969
Bank loans due after one year (7,588) - -
Total net (debt) / cash excluding leases (4,045) 4,012 18,969
12. FINANCIAL INSTRUMENTS
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 finance function. The Board receives monthly
reports from the Group Financial Director 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.
The Group's principle financial instruments (other than derivatives)
compromise loans, cash and short -term deposits; the main purpose of these
instruments is to raise finance for the Group's operations; and additionally
include trade and other receivables, trade and other payables and lease
liabilities.
The Group also enters derivative transactions, principally foreign exchange
contracts and wheat futures to manage commodity price and currency risks
arising from the Group's operations.
The Group's policy does not permit use of derivatives for speculative
purposes. However, some derivatives do not qualify for hedge accounting, or
are specifically not designated as a hedge where gains and losses on the
hedging instrument and the hedged item naturally offset in the Group's income
statement. Treasury operates on a centralised basis, where Derivatives are
only used for economic hedging purposes and not as speculative investments and
are classified as 'held for trading', other than designated and effective
hedging instruments and are presented as current assets or liabilities if they
are expected to be settled within 12 months after the end of the reporting
period, otherwise they are classified as non current.
The principal financial instruments used by the Group, from which risk arises,
are as follows:
· Cash and cash equivalents
· Trade receivables
· Trade and other payables
· Borrowings
· Forward currency contracts
· Wheat futures contracts
The following financial instruments have been recognised in the Group's
respective financial statements:
GROUP
Financial Assets Apr 22 Apr 21 Oct 21
£000 £000 £000
Cash and cash equivalents 6,112 4,991 19,641
Trade receivables, net of loss allowance 98,139 73,080 70,320
Loan to joint venture 2,090 3,865 3,319
Derivative of financial instruments 359 227 325
106,700 82,163 93,605
GROUP
Financial Liabilities Apr 22 Apr 21 Oct 21
£000 £000 £000
Bank loans and other borrowings 10,157 979 672
Lease liabilities 8,710 8,860 9,726
Trade payables and other payables 81,823 63,029 69,868
Deferred and contingent consideration 3,785 229 197
Derivative financial instruments 825 214 193
105,300 73,311 80,656
Financial instruments not measured at fair value includes cash and cash
equivalents, trade and other receivables, trade and other payables, loans and
borrowings, and lease liabilities. Due to their short-term nature, the
carrying value of cash and cash equivalents, trade and other receivables, and
trade and other payables approximates their fair value.
IFRS 13 requires financial instruments that are measured at fair value to be
classified according to the valuation technique used:
· Level 1 - quoted prices (unadjusted) in active markets for
identical assets or liabilities
· Level 2 - inputs, other than level 1 inputs, that are observable
for the asset or liability, either directly (i.e. as prices) or indirectly
(i.e. derived form prices)
· Level 3 - unobservable inputs
All derivative financial assets and liabilities are classified as Level 1
instruments as they are quoted market prices. Contingent consideration is
measured at fair value using Level 3 inputs such as entity projections of
future probability.
Fair value Amortised cost
Financial Assets Apr 22 Apr 21 Oct 21 Apr 22 Apr 21 Oct 21
£000 £000 £000 £000 £000 £000
Trade Receivables, net of loss allowance - - - 98,139 73,080 70.320
Trade and other receivables - - - 2,090 3.865 3,319
Derivative financial instruments (Level 1) 359 227 325 - - -
359 227 325 100,229 76,945 73,639
Fair value Amortised cost
Financial Liabilities Apr 22 Apr 21 Oct 21 Apr 22 Apr 21 Oct 21
£000 £000 £000 £000 £000 £000
Bank loans and other borrowings - - - 10,157 979 672
Lease liabilities - - - 8,710 8,860 9,726
Trade and other payables - - - 81,823 63,029 69,868
Deferred and contingent consideration 3,785 229 197 - - -
Derivative financial instruments (Level 1) 825 214 193 - - -
4,610 443 390 100,690 72,868 80,266
The Group is exposed through its operation to the following financial risks:
· Credit risk
· Foreign exchange risk
· Commodity market price risk
· Interest rate risk
· Liquidity risk
· Capital management risk
The policies and processes for managing each of these risks are summarised in
the Group's annual report published in February 2022 and available on the
Company's website.
13. EARNINGS PER SHARE
Basic earnings per 25p ordinary share has been calculated by dividing profit
for the period attributable to ordinary shareholders by the weighted average
number of ordinary shares in issue during the period. For diluted earnings per
share the weighted average number of ordinary shares is adjusted to assume
conversion of all dilutive potential ordinary shares (share options and
warrants) taking into account their exercise price in comparison with the
actual average share price during the year.
Unaudited Unaudited
six months six months
ended ended
30 April 2022 30 April 2021
20,311,023 20,055,501
Weighted average number of shares in issue: basic
Earnings per share: basic in pence 36.99 21.62
Weighted average number of shares in issue: diluted 20,831,327 20,365,205
Earnings per share: diluted in pence 36.07 21.30
14. SHARE CAPITAL
Number of shares Total Nominal Value
000s £000
Allotted and fully paid: ordinary shares 25p each
Balance at 31 October 2020 20,051 5,013
Issue of shares 86 21
Balances at 30 April 2021 20,137 5,034
Issue of shares 162 41
Balances at 31 October 2021 20,299 5,075
Issue of shares 77 19
Balances at 30 April 2022 20,376 5,094
The shares issued in the period related to 26,000 company share options (2021:
24,000) and 51,000 (2021: 62,000) shares allotted to shareholders exercising
their rights to receive dividends under the Company's scrip dividend scheme.
No other shares were allocated during the current or prior period.
As at 30 April 2022 a total of 20,376,000 shares are in issue (2021:
20,137,000).
15. DIVIDENDS
During the period ended 30 April 2022 an amount of £2,134,000 (2021:
£2,008,000) was charged to reserves in respect of equity dividends paid. An
interim dividend of 5.40p per share (2021: 5.00p) will be paid on 31 October
2022 to shareholders on the register on the 30 September 2022. New elections
to receive Scrip Dividends should be made in writing to the Company's
Registrars before 14 October 2022.
16. OTHER RESERVES
Included in Other reserves are share-based payments; as the Group issues
equity-settled share-based payments to certain employees. Equity-settled
share-based payments are measured at fair value at the date of the grant. The
fair value determined at the grant date of the equity-settled share-based
payments is expensed on a straight-line basis over the vesting period, based
on the Group's estimate of shares that will eventually vest.
The Group operates a number of share option and 'Save As You Earn' schemes and
fair value is measured by use of a recognised valuation model. The expected
life used in the model has been adjusted, based on management's best estimate,
for the effects of non-transferability, exercise restrictions and behavioural
considerations.
At the 30 April 2022 the ESOP Trust, which is consolidated within the Group
financial statements, held 16,834 (2021: 16,834) Ordinary Shares in the Group.
17. BUSINESS COMBINATION NOTE
Humphrey Poultry (Holdings) Limited
On 18 March 2022, Wynnstay Group plc entered a business combination and
acquired 100% of the share capital of Humphrey Poultry (Holdings) Limited,
which is the holding company for two commercial and operational entities,
Humphrey Feeds Limited and Humphrey Pullets Limited.
The provisional assessed consideration is £13.171m inclusive of £1.011m of
cash. This provisional consideration is subject to verification of a minimum
underlying net asset target value of the acquiree, including the cash, of
£6.171m, which due to the timing of the preparation of completion accounts
for the acquiree, is expected to be finalised during the second half of the
Group's financial year. The provisional consideration will be adjusted should
the confirmed net assets of the acquiree be higher or lower than the target
value. The Board believes at the time of half-year announcement that the net
assets are not likely to significantly change.
The sum of £9.485m was paid on completion and the provisional consideration
includes a deferred contingent element subject to the achievement of certain
commercial targets to be assessed after the first anniversary of completion.
The fair value of a deferred contingent consideration element has been based
on management's expectation of the future performance of the business and that
could range from £nil to £2.000m. The remainder of the provisional
consideration is to be paid upon final verification of the acquiree's net
assets as explained above, but which are currently estimated to be analysed as
follows:
Current Non- Current Total
£000 £000 £000
Trade receivables net of loss allowance 5,003 - 5,003
Other receivables 595 - 595
Inventories 2,144 - 2,144
Cash and cash equivalents 1,011 - 1,011
Trade payables (3,469) - (3,469)
Other payables (347) - (347)
Lease liabilities (146) (64) (210)
Deferred tax - (101) (101)
Net Current Assets and Non-Current Liabilities 4,791 (165) 4,626
Tangible fixed assets - 1,545 1,545
Underlying Net Assets of Acquiree 4,791 1,380 6,171
A full analysis of the provisional consideration is provided in the table
below which includes the break-down of the tangible fixed assets which
incorporates freehold land and buildings in the amount of £599k, which
reflects the current view of fair value assessment of this element of the
purchase price. An independent valuation of this property has been
commissioned at the time of this announcement, but this will not impact the
provisional consideration, but may adjust the analysis. The goodwill balance
represents the assembled workforce and future sales opportunities and is not
expected to be deductible for tax purposes.
Fair Value of Net Assets
Total
£000
Fair value of net assets required
Goodwill 3,143
Intangible - Brand 3,775
Intangible - Customer list 963
Property, plant and equipment 1,335
ROU assets 210
Cash and cash equivalents 1,011
Trade receivables 5,003
Other receivables 595
Inventories 2,144
Trade payables (3,469)
Other payables (347)
Lease liabilities (210)
Deferred tax (982)
Net Assets 13,171
Acquisition date - fair value of the total net assets acquired 13,171
Represented by:
Cash settled to vendor during the period 9,485
Contingent on net asset verification outstanding at 30 April 2022 1,686
Contingent and deferred outstanding at 30 April 2022 2,000
Provisional Consideration 13,171
Cash Flow Statement:
Cash Settled to vendor during the period 9,485
Less, cash and cash equivalents acquired (1,011)
Cash paid to other vendors during the period for prior acquisitions 98
8,572
Directly attributable acquisition costs of £523k were incurred with the
transaction, and these have been recognised as non-recurring expenses in the
income statement for the period. During the last available audited accounts of
the acquired entities, for the period to February 2021, the annual aggregate
revenues on a non-consolidated basis amounted to £41.446m and profit before
tax was £1.634m. Business combination accounting is expected to be finalised
within 12 months from the completion date of the acquisition.
Amounts included in the Consolidated Statement of Comprehensive Income period
to 30 April 2022 in relation to the acquired business are revenues of £6.407m
and profit before tax of £0.183m.
Contingent and deferred consideration of £0.098m was paid during the period
to 30 April 2022 relating to other prior period acquisitions, resulting in a
total gross cash outflow of £9.583m in the six-month period to 30 April 2022
or £8.572m net of cash acquired with the Humphrey transaction.
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