Share Name Share Symbol Market Type Share ISIN Share Description
Phsc Plc LSE:PHSC London Ordinary Share GB0033113456 ORD 10P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 12.50 12.00 13.00 12.50 12.50 12.50 0.00 07:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Support Services 4.4 0.0 -0.1 - 2

PHSC Plc Final Results

20/08/2020 7:00am

UK Regulatory (RNS & others)

PHSC plc 
                        (the "Company" or the "Group") 
  Final Results for the year ended 31 March 2020 and Notice of Annual General 
Financial Highlights 
*            EBITDA of GBP0.255m, an increase of approximately 120% from GBP0.116m 
last year (after adjustment for exceptional gain on property sale of GBP0.166m 
last year) 
*            Statutory loss after tax of GBP0.015m compared with a profit of GBP 
0.001m last year (which included gain on property sale of GBP0.166m last year) 
*            Group revenue of GBP4.438m compared with GBP5.215m last year 
*            Cash reserves of GBP0.756m at year end compared to GBP0.642m last year 
*            Write-down of GBP0.200m due to impaired goodwill, the same as last 
*            Group net assets at GBP4.978m after goodwill impairment compared to 
GBP5.140m last year 
*            Loss per share of 0.11p compared to a profit per share of 0.005p 
last year 
*            Final dividend of 0.5p proposed, making a total of 1.0p for the 
year, matching the 1.0p paid last year 
                                                             31.3.20        31.3.19 
                                                                   GBP              GBP 
Profit before tax                                              4,999         42,494 
Less: interest received                                      (1,990)          (303) 
Add: interest paid                                                 -          1,514 
Add: depreciation                                             52,194         38,179 
Add: impairment B2BSG Solutions Limited goodwill             200,000        200,000 
Less: net gain on sale of property                                 -      (166,270) 
Underlying EBITDA*                                           255,203        115,614 
* Underlying EBITDA is calculated as earnings before interest, tax, 
depreciation, impairment charges and non-recurring costs.  This is used by the 
board as a measure of underlying trading and has been provided to assist 
shareholders in understanding the Group's trading activities. 
Annual General Meeting 
This year's annual general meeting (AGM) will be held at 10am on Wednesday 30 
September 2020 at the Old Church, 31 Rochester Road, Aylesford, Kent ME20 7PR. 
The report and accounts and notice of AGM are expected to be posted to 
shareholders on or around 24 August 2020 and will shortly be available to view 
on the Company's website at 
The Company confirms that, subject to shareholder approval at the AGM, the 
final dividend of 0.5p will be payable on 16 October 2020 to shareholders on 
the register on 2 October 2020. 
For further information please contact: 
PHSC plc ( 
Stephen King ( - 01622 717700 
Strand Hanson Limited (Nominated Adviser) 
Richard Tulloch/James Bellman - 020 7409 3494 
Novum Securities Limited (Broker) 
Colin Rowbury - 020 7399 9427 
About PHSC 
PHSC plc, through its trading subsidiaries Personnel Health & Safety 
Consultants Limited, RSA Environmental Health Limited, QCS International 
Limited, Inspection Services (UK) Limited, and Quality Leisure Management 
Limited, provide a range of health, safety, hygiene, environmental and quality 
systems consultancy and training services to organisations across the UK. B2BSG 
Solutions Limited offers innovative security solutions including electronic 
tagging, labelling and CCTV. 
The information contained in this announcement is deemed by the Company to 
constitute inside information as stipulated under the Market Abuse Regulations 
(EU) No 596/2014. 
On behalf of the board, I present my review of the Group's activities and 
performance during financial year 2019-20, along with a commentary about the 
Group's plans and expectations for 2020-21. 
General business review and outlook 
Trading for the year ended 31 March 2020 showed consolidated Group revenue of GBP 
4.438m (31 March 2019: GBP5.215m) and EBITDA of approximately GBP255,000 for the 
period. In the previous year, the Group recorded EBITDA of GBP116,000 (excluding 
an exceptional gain from the sale of an unused property). 
Sales within B2BSG Solutions Limited, the Group's security division which 
predominantly serves the high street retail sector, continued to decline during 
the year, as a result of the ongoing struggles within the high street retail 
sector impacting on the demand for our services.  Revenues in the security 
division fell to GBP1.9m (31 March 2019: GBP2.7m), accounting for 43% of Group 
revenues compared with 52% in the previous year.  As a result, the board 
considered the carrying value of its security division and decided that a 
further impairment of GBP0.2m (31 March 2019: GBP0.2m) was appropriate. 
Revenues in the Group's health, safety and management systems businesses 
remained stable at GBP2.5m (31 March 2019: GBP2.5m), though accounted for 57% of 
the Group's overall revenue (31 March 2019: 48%). 
Various actions were taken to mitigate the effect of lower sales across the 
Group as a whole, which led to cost savings in a number of areas. In 
particular, there were lower overheads and premises-related savings across the 
Group. The security division, whilst still loss-making, saw an improvement 
overall and further commentary regarding this subsidiary and the other 
companies within the Group appear later in this report. 
Impact of COVID-19 
The specific impacts of COVID-19 on each subsidiary is provided later in this 
report, though from a Group-wide perspective the pandemic had a marginally 
adverse impact on the year ended 31 March 2020. The financial consequences of 
COVID-19 will largely be seen in 2020-21, though are at this stage very 
difficult to quantify due to the uncertainty of how the UK economy will respond 
to the on-going COVID-19 pandemic. The trading update below provides figures 
for Q1 of 2020-21. 
Cash at bank stood at GBP756,000 at year end. Due to concerns about cash flow 
during the COVID-19 pandemic, the Group exercised an option to defer payment of 
VAT due for Q4 of 2019-20 but has recently made these payments in full (GBP 
162,410) to HMRC. 
The Group continues to enjoy a strong cash position and has an undrawn facility 
with HSBC plc, renewed in October each year and currently agreed at GBP50,000, 
having been reduced from GBP150,000. 
Since the start of the pandemic, the Group has reviewed staffing levels and has 
made five posts redundant, including three at the security division.  In 
addition, the Group furloughed a number of staff under the Government's Job 
Retention Scheme.  All except one subsidiary has taken advantage of the 
furlough arrangements, with up to half of the Group's staff furloughed at the 
peak of the crisis. 
Our priority has been the health, safety and wellbeing of customers and staff, 
and our expertise in the field of health and safety has enabled us to continue 
to provide various services to existing clients.  We have also been able to 
acquire new clients who commissioned us to assist with enabling them to provide 
COVID-Secure environments so that they could return to work. 
All Group directors elected to take a 20% reduction in pay from 1 May 2020 for 
the duration of the furlough scheme. 
Net asset value 
As at 31 March 2020, the Group's consolidated net assets stood at GBP4.98m (2019: 
GBP5.14m). There were 14,677,257 ordinary shares in issue at that date which 
equates to a net asset value per share of 34p. 
As we have previously stated, the Company's ordinary shares continue to trade 
at a substantial discount to the net asset value.  We recognise that there is a 
value of goodwill on the balance sheet and we review this each year to ensure 
that the value is fairly stated.  In each of the past two years, the board has 
taken the decision to reduce the carrying value of our security division by GBP 
200,000, and we have done the same thing in 2019-20 in line with good 
accounting practice.  The write-down represents a reduction of approximately 4% 
in the consolidated net assets of the Group.  The board remains satisfied that 
all other goodwill valuations can presently be justified. 
Whilst the effect of COVID-19 on the economy is the greatest concern for the 
Group, this does not reduce the potentially negative effects of the lack of 
specific terms on which the UK will trade with the EU at the end of the 
transition period this year.  That matter was causing some clients to delay 
certain investment decisions, and this is exacerbated by the uncertainly 
brought about by the pandemic.  We may also be affected positively or 
negatively by future Government fiscal measures to assist the recovery of the 
UK economy and we will pay close attention to such decisions as they are 
announced.  In the context of our security division, an important general 
economic factor is the purchasing power of sterling as a weaker pound erodes 
our gross margins. The closure of many retail premises is also a critical 
factor as the move to online shopping accelerates. 
Trading update 
Unaudited management accounts for the first quarter of 2020-21 indicate that 
Group revenues were GBP0.82m and generated an EBITDA of GBP108,300.  This compares 
with total revenues of GBP1.08m for the first quarter of 2019-20 and an EBITDA of 
A total dividend of 1.0p per ordinary share, (GBP146,772) was paid in respect of 
the year ended 31 March 2019.  An interim dividend of 0.5p in respect of the 
year ended 31 March 2020 was paid in February 2020 and, subject to shareholder 
approval, a final dividend of 0.5p, to be paid from earnings from the year 
ended 31 March 2020, is proposed for payment in October 2020, matching the 
total of 1.0p paid last year. 
Pre-tax profit/(loss) per subsidiary before Group management charges 
Profits before tax and management charges are reviewed by each subsidiary and 
by the board every month to establish whether each subsidiary is trading 
profitably and to determine whether intervention is necessary.  To provide a 
more accurate picture of the performance of each subsidiary, the cross-charging 
of consultants between subsidiaries has been introduced so that the cost of 
labour is met by the invoicing company rather than the subsidiary providing 
that labour. 
A review of the activities of each trading subsidiary is provided below.  The 
profit figures stated are before tax, central management charges and impairment 
charges.  The management charges are the individual subsidiary's contribution 
to Group overheads and are not directly attributable costs. 
B2BSG Solutions Limited (B2BSG) 
  * 2020: revenues of GBP1,915,200 yielding a loss of GBP90,800 
  * 2019: revenues of GBP2,724,000 yielding a loss of GBP137,400 
The fall in revenue reflects the reduced demand from B2BSG's primary sphere of 
operation which remains the retail sector which has continued to suffer as a 
result of weaker consumer demand on the high street and the move towards 
on-line purchasing which has accelerated during the COVID-19 pandemic.  Over GBP 
165,000 was saved in lower staff salaries and associated expenditure through 
restructuring and non-replacement of leavers.  There were no redundancy 
payments necessary in this process. 
There are bad debts of GBP18,730 provided for in the accounts. These stem mainly 
from a second period of administration by a large client, Debenhams, who have 
proposed a Company Voluntary Arrangement for their UK businesses and have 
closed their estate in Ireland entirely. 
Selling into the retail sector remains challenging and the COVID-19 pandemic 
will have a large effect on our client base.  Any further material 
deterioration in the retail sector and specifically in B2BSG's client base may 
have a significant negative effect on B2BSG's and hence the Group's prospects. 
 In the meantime, B2BSG is making use of available business grants and the 
Government's Job Retention Scheme and looks forward to an increase in demand 
once high streets are able to recover. 
Inspection Services (UK) Limited (ISL) 
  * 2020: revenues of GBP230,800 yielding a profit of GBP37,400 
  * 2019: revenues of GBP232,600 yielding a profit of GBP43,500 
ISL ended the year with marginally lower sales and a slight increase in total 
costs compared with the prior year.  ISL offers a fairly narrow range of 
specialised services directly to clients and, for the most part, through 
insurance brokers.  The work involves the statutory examination and inspection 
of workplace plant and equipment where plant failure may lead to a serious risk 
of injury.  This includes lifting plant and equipment, pressure vessels, power 
presses and bailing machines. 
Early in the COVID-19 pandemic, the Health and Safety Executive (HSE) notified 
duty holders across the UK that the obligation to have plant and equipment 
examined in line with statutory frequencies was not being relaxed.  Our 
professional association, the Safety Assessment Federation, in consultation 
with the HSE, deemed us to be "key workers".  This enabled ISL to carry on 
trading as normal, subject to complying with appropriate safety protocols to 
safeguard staff and those they may encounter in their work and as a result, 
demand has remained stable during since the financial year end. 
Personnel Health & Safety Consultants Limited (PHSCL) 
  * 2020: revenues of GBP763,600 yielding a profit of GBP302,500 
  * 2019: revenues of GBP657,100 yielding a profit of GBP278,000 
Income from PHSCL's flagship product, the Appointed Safety Advisor Service was 
around 10% down year on year.  However, consultancy income from non-retained 
clients more than doubled to around GBP225,000.  In addition, revenue from 
training courses was up by GBP20,000. 
Despite the reduction in revenue from the Appointed Safety Advisor Service, 
PHSCL derives most of its income from this product.  There was some client 
churn, though generally client retention is good and has not been unduly 
affected by the COVID-19 pandemic. 
PHSCL continues to meet the accreditation requirements for the ISO 9001 quality 
management standard, having held this "kitemark" for 23 years since becoming 
the first organisation of its kind to achieve the standard. 
Since the financial year-end, COVID-19 has had an effect both on PHSCL and the 
clients we serve.  There has been demand for consultancy advice in relation to 
preparing COVID-Secure workplaces and this has introduced us to a number of 
clients for whom we have not worked before.  Once a degree of normality 
returns, we would hope to build on those relationships by offering other 
QCS International Limited (QCS) 
  * 2020: revenues of GBP756,700 yielding a profit of GBP220,900 
  * 2019: revenues of GBP759,500 yielding a profit of GBP242,300 
QCS maintained a good level of both sales and profits and performed as expected 
over the year.  The introduction of management standard ISO 45001 (for health 
and safety) and work assisting clients on ISO 27001 (information security) more 
than offset the loss of work in the previous year relating to the transition to 
new quality and environmental standards. 
Sales in public training and consultancy services remained strong.  Full 
advantage was made of the investment in new training facilities that are now 
able to accommodate additional delegates.  However, in-house training sales 
weakened, and this caused total sales for the year to end marginally below 
those for 2018-19.  An internal target to increase public training sales by 12% 
over the period was achieved.  Efforts will continue to promote in-house 
services and reduce the decline in that area. Consultancy sales remained 
consistently strong throughout the year, posting growth of 7%.  QCS continues 
to enjoy exceptionally high levels of repeat business and has developed a loyal 
customer base across many economic sectors. 
Departure from the EU has not yet directly affected sales, though a significant 
proportion of medical device work is linked to an ability to offer services 
linked to EU regulation.  QCS now offers a 'UK Responsible Person' service in 
the event of a no-deal conclusion to the transition period which may present 
some opportunities, acting as a UK address for manufacturers of medical devices 
within the remaining EU.  To date there have been an encouraging number of 
enquiries regarding the service.  The weakness of sterling has the potential to 
work in QCS's favour. 
Quality Leisure Management Limited (QLM) 
  * 2020: revenues of GBP353,400 yielding a profit of GBP75,700 
  * 2019: revenues of GBP437,600 yielding a profit of GBP106,500 
QLM made a profit before tax and central management charges of GBP75,711, 
compared to GBP106,576 in the previous year. 
Retained client renewals remained largely the same in comparison to the 
previous period.  Small deviations are seen as contracts between local 
authorities and QLM clients change, or smaller clients are absorbed by larger 
operators though there remains a strong need for QLM's expertise with clients 
placing significant reliance on its services. 
Although the support service remains a stable source of income, audit income 
fell significantly compared to the same period last year.  Savings and cost 
cutting exercises across many local authorities has seen a knock-on effect to 
the resources of leisure trusts and other QLM clients.  In addition, auditing 
functions are more frequently tackled internally by clients leading to less 
need for external verification and auditing.  The impact of COVID-19 remains to 
be seen and will depend on what support is given to the sector by local 
authorities and central government. 
Training is a core income stream and remained generally consistent with 
previous years.  The most popular courses were IOSH Managing Safely and QLM's 
own (CIMSPA Endorsed) Health and Safety Management in Leisure and Culture 
One full-time consultant left the business in October 2019 and was not replaced 
which led to greater use of sub-contractors. 
RSA Environmental Health Limited (RSA) 
  * 2020: revenues of GBP418,100 yielding a profit of GBP83,500 
  * 2019: revenues of GBP404,300 yielding a profit of GBP66,700 
Revenue for the year was up by 3.4% to GBP418,100.  Costs were effectively 
controlled, and this led to gross profit margin of 53% (2019: 52%). 
Integration of the Envex brand into RSA has brought in some much-needed skills 
which have aided service delivery to our existing clients, reducing the need to 
rely on contractors and associates. 
Whereas in previous years the focus of RSA has been on the SafetyMARK brand, 
providing safety services to the school's sector, this year has seen the 
revenues fall into four main categories; training, health and safety 
consultancy, food safety consultancy and SafetyMARK. This has widened the focus 
and spread some of the risk, leaving RSA potentially less exposed in the 
SafetyMARK, whilst remaining the main focus, saw revenues fall within the 
financial year to around GBP90,000.  This can be partially accounted for by a 
number of postponed audits at short notice within the last quarter. This 
happened due to a combination of staffing changes at key schools and the start 
of the COVID-19 pandemic. There was also an impact on this sector by RSA 
diverting its attention to fulfilling a large contract in the hospitality 
sector.  However, demand for safety services in schools remains strong and is 
expected to pick up when schools are fully open in September 2020. 
Training has seen an increase due to the numbers of courses being provided to 
clients compared to the previous year.  There continues to be demand for some 
of our public courses within the schools' sector and for our IOSH accredited 
school courses. Training was not unduly affected by COVID-19 in March, with 
only a couple of courses having to be postponed to the next financial year 
Health and safety consultancy saw the biggest change in demand for the year 
2019-20 as a result of the large contract in the hospitality sector previously 
mentioned.  This generated significant revenues for RSA but was very heavy in 
administrative terms. 
Food safety consultancy saw strong demand, but the impact of COVID-19 saw an 
end to the ability to continue with auditing of our regular clients. All 
clients have stated that they will restore the audit programmes as soon as the 
various sectors are allowed to open. 
PHSC plc 
  * 2020: net loss of GBP424,100 before management charges, exceptional costs and 
    dividends received 
  * 2019: net loss of GBP523,700 before management charges, exceptional costs and 
    dividends received 
The Company incurs costs on behalf of the Group and does not generate any 
income. The costs incurred by the Company represent the costs of running an AIM 
quoted Group. The reduction in costs is due to changes in staffing arrangements 
between the Company and the subsidiaries. Costs in all other respects are 
consistent with the previous year. 
The coronavirus pandemic involving the spread of COVID-19 has presented several 
different risks to the business. The spread was rapid and the global 
repercussions unprecedented. 
As Government guidance evolved, a comprehensive plan was developed and updated 
by the directors to minimise the risk to staff, customers and business 
continuity. This was circulated to all staff and contained measures to maintain 
business productivity whilst protecting the health of employees, customers, and 
other stakeholders. The plan was monitored and revised in response to new 
information published by Public Health England. Guidance was also published on 
the website for staff, customers, and prospects to access. 
The risk of employees contracting the virus, resulting in loss of key staff to 
illness was mitigated by working from home being encouraged wherever 
appropriate. Vulnerable workers were identified and asked to shield, and 
employees contacted regularly to monitor welfare. A skeleton staff remained in 
the head office to minimise numbers present whilst at the same time maintaining 
business continuity.  Social distancing was exercised, and hand sanitiser 
Where consultants were required to visit clients' premises, mainly to advise on 
COVID-19 related topics, face masks and disposable gloves were issued. 
Consultants were asked to use their own vehicles to commute rather than take 
public transport. A focus was to protect PHSC's reputational risk by ensuring 
staff adhered to government guidelines. In the short term, all classroom 
training was ceased. 
The risk of poor communication during the pandemic was mitigated using 
Microsoft Teams and Zoom to keep in touch with staff and clients. The 
operational directors met via Zoom each week for a business update and to share 
knowledge and best practice. Board meetings were also undertaken as scheduled 
via Zoom. 
In terms of lost revenue and profit, the impact in the year ended 31 March 2020 
was immaterial though the full effect will be felt in the new financial year. 
The UK lockdown has inevitably led to a loss of business and revenue, as 
schools, leisure facilities, shops and pubs/restaurants make up a significant 
portion of the Group's customer base. An exception to this is ISL, where the 
Health and Safety Executive did not relax the obligation to have plant and 
equipment examined in line with statutory frequencies. The engineers were 
deemed key workers and ISL was able to carry on trading as normal, subject to 
complying with appropriate safety protocols to safeguard staff. Another 
mitigating factor is the uninterrupted subscription income received by some of 
the subsidiaries which provides a base of ongoing revenue. It is also fortunate 
that the expertise within the Group in the field of health and safety has 
enabled various services to continue to be provided to existing clients and new 
clients have been secured who commissioned assistance with the provision of 
COVID-Secure environments. Income from the Government Job Retention Scheme and 
Business Grants have also played a key role in maintaining cash flow. 
In terms of liquidity risk, the Group had a strong cash position at the year 
end and the start of lockdown. Good credit control has been maintained by the 
head office staff and with the income from the Government's schemes, the Group 
has remained cash generative. Payment of VAT for Q4 was initially delayed in 
line with an HMRC concession but was subsequently settled in full. 
Although the economic outlook remains uncertain, the discipline of forecasting 
has been maintained, though initially with a reduced horizon.  Expectations for 
first half of 2020-21 are that with the continued use of Government funding 
assistance, the Group should do no worse than break even and will maintain a 
strong cash position. 
Approximately 50% of the Group's work involves assisting organisations with the 
implementation of measures to meet regulatory requirements relating to health 
and safety at work. If the regulatory burden was to be substantially lightened, 
for example if the government embarked upon a programme of radical 
deregulation, there could be less demand for the Group's services.  Changes to 
the operation of the employer's liability insurance system, as proposed in some 
quarters, could reduce the incentive for organisations to buy in 
claims-preventive services such as health and safety advice.  In mitigation of 
these risks, the board has diversified the Group's range of offerings for 
example, through investing in its security businesses and is exploring 
non-regulatory areas of environmental work to add to the current portfolio of 
In the event of a "no deal" end to the post-Brexit transition period, the 
Group's security division will take appropriate steps to ensure that sufficient 
supplies are held of relevant products to meet the predicted needs of 
customers.  In doing so, customers can expect more frequent requests to 
forecast their likely requirements over longer time horizons than usual.  The 
security division is already dealing extensively with a wide range of imported 
goods, some from within the EU and others from countries beyond the EU.  It is 
therefore well-versed in customs processes and expects to be able to apply the 
same or similar processes to imports from within the EU (albeit at potentially 
different tariff rates) should that prove necessary under a "no deal" Brexit. 
Matters outside the Group's control would include delays caused at customs if 
administrative demands on border officials are suddenly increased, resulting in 
slower clearance times for imported goods. 
There are predictions by economists that the value of sterling may deteriorate 
if the UK and EU cannot reach a trade deal by the end of the transition 
period.  Whilst the Group will take reasonable steps to hedge against the 
effects of a weaker pound, customers are being advised to consider pre-ordering 
and/or increasing their stock levels of those products supplied by the Group's 
security division which they see as critical to their business. Higher stock 
levels would have the double benefit of reducing the risk of an interruption to 
supply, and mitigating the impact of price rises that would ultimately work 
their way through to all imported goods if there is a materially weaker 
exchange rate. The warehouse at B2BSG has the capacity for storage of 
additional products and close partnership with logistics providers will allow 
access to further warehousing space should that prove necessary. 
The Group's security division works almost exclusively in the retail sector and 
this has continued to suffer as a result of weaker consumer demand on the high 
street and the move towards on-line purchasing which has accelerated during the 
COVID-19 pandemic.  Any further material deterioration in the retail sector and 
specifically in B2BSG's client base may have a significant negative effect on 
the company's and hence the Group's prospects. 
The Group's website is a primary source of new business.  If the website became 
inaccessible for protracted periods, or was subject to "hacking", this may 
prejudice the opportunity to obtain new business.  Additionally, the increase 
in the use of the internet for satisfying business requirements may lead to a 
reduction in demand for face-to-face consultancy services and the number of 
training courses commissioned may be affected by moves towards screen-based 
interactive learning.  The subject of IT security is regularly reviewed by the 
board to ensure that appropriate strategies are in place. 
Generally, there is an excess of demand over supply for health and safety 
professionals.  Those with sufficient qualifications and experience to be 
suitable for consultancy roles are in the minority.  This has the combined 
effect of making it difficult for the Group to source suitable personnel and 
having to offer higher remuneration packages to attract them.  The Group is 
dependent upon its current executive management team. Whilst it has entered 
into contractual arrangements with the aim of securing the services of these 
personnel, the retention of their services cannot be guaranteed.  Accordingly, 
the loss of any key member of management of the Group may have an adverse 
effect on the future of the Group's business. The Group and each subsidiary 
have contingency plans in place in the event of incapacity of key personnel. 
The Group offers a nationwide service, but a number of organisations see 
benefit in using consultancies that are local to them and internet search 
engines favour local providers.  With offices in Kent, Berkshire, 
Northamptonshire and Scotland, the Group has a good geographical spread. 
The Group is reliant on licences and accreditations to be able to carry on its 
business.  The temporary loss of, or failure to maintain, any single licence or 
accreditation would be unlikely to be materially detrimental to the Group, as 
the directors believe that this could be remedied.  However, if the Group fails 
to remedy any loss of, or does not maintain, any licence or accreditation, this 
will have a material adverse effect on the business of the Group.  The Group 
has internal processes in place to ensure that the licences and accreditations 
are maintained. 
The Companies (Miscellaneous Reporting) Regulations require large companies to 
publish a statement describing how the directors have had regard to the matters 
set out in section 172 (1) (a) to (f) of the Companies Act 2006. These sections 
require directors to act in a way most likely to promote the success of the 
Group for the benefit of its stakeholders and with regard to the following 
The likely consequences of any decision in the long-term. 
The board receives an annual business plan from the director of each subsidiary 
company, which forms the basis of the Group's strategic plan. The board 
requires that the plans include financial forecasts, KPI's, marketing strategy 
and an analysis of strengths, weaknesses, opportunities, and threats. 
Subsidiary directors, via the Groups operational board of which they are 
members, consider the implications of their own plans in the context of what 
others within the Group are intending to do and the opportunities for synergies 
are explored. Any proposed actions that may adversely affect another subsidiary 
are flagged at operational board level and are resolved. Subsidiary directors 
are challenged on the content of their plans and the assumptions they have 
made, to ensure that the plans are realistic and achievable. Once agreed by the 
board, this plan, at Group and subsidiary level, is used as the benchmark 
against which to assess performance. 
The interests of the Group's employees 
As the Group is mainly involved in the supply of services, the board considers 
the staff to be the greatest asset and the interests of employees are taken 
into consideration in all decisions made. Each subsidiary company within the 
Group has in place the necessary structures to ensure effective communication 
with its employees. The subsidiary directors meet once a quarter and relevant 
information is shared with employees via team meetings held at subsidiary 
level.  The views of employees are heard in a similar fashion, initially at 
team meetings, and ascending to the operational board and the main board if 
appropriate. Each subsidiary has its own bonus scheme, based on results for the 
financial year and/or tailor-made targets. There is an annual budget for staff 
training in recognition that the performance of the Group can be improved by 
the development of its employees. 
The Group is committed to equality of employment and its policies reflect a 
disregard of factors such as disability in the selection and development of 
employees. During the year, a review was conducted to identify any 
gender-related pay anomalies across the Group and as at the date of this 
report, there are no known anomalies in any subsidiary that would fall into 
this category. 
The need to foster the Group's business relationships with suppliers, 
customers, and others. 
The Group seeks to treat suppliers fairly and adhere to contractual payment 
terms. The Group works with its suppliers to help drive change through 
innovation, promoting new ideas and ways of working.  The Group has 
zero-tolerance to modern slavery and is committed to acting ethically and with 
integrity in all business dealings and relationships. The Group policy for 
Modern Slavery and Human Trafficking contains systems and controls to ensure 
that these activities are not taking place anywhere in the subsidiaries or 
throughout the Groups supply chains. 
The Group also has zero-tolerance with regards to bribery, made explicit 
through its Anti-Bribery and Corruption Policy. This covers the acceptance of 
gifts and hospitality and any form of unethical inducement or payment including 
facilitation payments and "kickbacks". The policy sets out the responsibilities 
of directors, employees and contractors and details the procedures in place to 
prevent bribery and corruption. 
Each subsidiary is focussed on its customers. Communication takes many forms 
and is structured according to how each subsidiary interacts with its client 
base. Channels of communication include quarterly newsletters in hard copy and/ 
or sent electronically, customer roadshows, various social media platforms and 
regular client meetings. An ongoing dialogue is held electronically, with most 
clients subscribing to email updates that are sent out periodically. There is 
also interaction through social media platforms such as Twitter, LinkedIn and 
Facebook where appropriate. 
Stephen King is the principal contact between the Company and its investors, 
with whom he maintains a regular dialogue.  The Company is committed to 
listening to and communicating openly with its shareholders to ensure that its 
business model and performance are understood. Regular announcements are made 
to the market and the AGM provides a forum for information dissemination, 
discussion, and feedback. 
The impact of the Group's operations on the community and the environment 
The board's intention is to behave responsibly and ensure that management 
operates the business in a responsible manner, complying with high standards of 
business conduct and good governance. The Group has a long tradition of 
supporting local causes through sponsorship and community involvement, details 
of which can be found on the PHSC plc website ( The directors 
are aware of the impact of the Group's business on the environment but believe 
this to be minimal due to the nature of its operations. 
Company law require the directors to consider the appropriateness of the going 
concern basis when preparing the financial statements. COVID-19 and the 
Government-imposed lockdowns and restrictions are inevitably having an impact 
on the Group's ability to trade normally. In terms of lost profit, a relatively 
small impact was felt in the year ended 31 March 2020 though the board's 
expectations for the new financial year have had to be significantly revised. 
Mitigating factors are the strong cash position at the start of lockdown, 
income from statutory examination of equipment (a requirement not relaxed 
during the pandemic), continuation of subscription income, demand for COVID-19 
Secure risk assessments, and income from the Government job retention and 
business grant schemes. The Group's expectations and current banking facilities 
indicate that the Group has adequate resources to continue in operational 
existence for the foreseeable future. Consequently, the directors continue to 
adopt the going concern basis of accounting in preparing the annual financial 
In closing, I would like to extend thanks to all our shareholders for their 
continued support and to everyone employed across the Group for their hard work 
and effort during these unprecedented times. The board acknowledges the 
valuable work carried out by every employee and recognises that it is reliant 
upon each individual member of staff and management if it is to succeed and 
On behalf of the board 
Stephen King, 
Group Chief Executive 
19 August 2020 
as at 31 March 2020 
                                                           31.3.20           31.3.19 
                                                                 GBP                 GBP 
Non-Current Assets 
Property, plant and equipment                              592,539           488,585 
Goodwill                                                 3,278,463         3,478,463 
Deferred tax asset                                          19,582            17,627 
                                                         3,890,584         3,984,675 
Current Assets 
Stock                                                      264,301           316,556 
Trade and other receivables                                885,947           973,130 
Cash and cash equivalents                                  755,919           642,466 
                                                         1,906,167         1,932,152 
Total Assets                                             5,796,751         5,916,827 
Current Liabilities 
Trade and other payables                                   622,938           675,162 
Right of use liabilities                                    34,071                 - 
Current corporation tax payable                             40,250            54,707 
                                                           697,259           729,869 
Non-Current Liabilities 
Right of use liabilities                                    69,912                 - 
Deferred tax liabilities                                    51,256            46,313 
                                                           121,168            46,313 
Total Liabilities                                          818,427           776,182 
Net Assets                                               4,978,324         5,140,645 
Capital and reserves attributable to equity 
holders of the Group 
Called up share capital                                  1,467,726         1,467,726 
Share premium account                                    1,916,017         1,916,017 
Capital redemption reserve                                 143,628           143,628 
Merger relief reserve                                      133,836           133,836 
Retained earnings                                        1,317,117         1,479,438 
                                                         4,978,324         5,140,645 
for the year ended 31 March 2020 
                                                           31.3.20            31.3.19 
                                                                 GBP                  GBP 
Continuing operations: 
Revenue                                                  4,437,922          5,215,341 
Cost of sales                                          (2,251,867)        (2,719,724) 
Gross profit                                             2,186,055          2,495,617 
Administrative expenses                                (1,983,046)        (2,418,182) 
Goodwill impairment                                      (200,000)          (200,000) 
Other income                                                     -            166,270 
Profit/ from operations                                      3,009             43,705 
Finance income                                               1,990                303 
Finance costs                                                    -            (1,514) 
Profit before taxation                                       4,999             42,494 
Corporation tax expense                                   (20,548)           (41,795) 
(Loss)/profit for the year after tax 
attributable to owners 
of the parent                                             (15,549)                699 
Other comprehensive income                                       -                  - 
Total comprehensive (loss)/income 
attributable to owners 
of the parent                                             (15,549)                699 
Basic and diluted (loss)/earnings per share 
from continuing operations                                 (0.11)p             0.005p 
for the year ended 31 March 2020 
                              Share     Share     Merger Redemption  Retained 
                            Capital   Premium     Relief    Reserve  Earnings     Total 
                                  GBP         GBP    Reserve          GBP         GBP         GBP 
Balance at 1 April 2018   1,467,726 1,916,017    133,836    143,628 1,625,511 5,286,718 
Profit for year 
attributable to equity            -         -          -          -       699       699 
Dividends                         -         -          -          - (146,772) (146,772) 
Balance at 31 March 2019  1,467,726 1,916,017    133,836    143,628 1,479,438 5,140,645 
Balance at 1 April 2019   1,467,726 1,916,017    133,836    143,628 1,479,438 5,140,645 
Loss for year 
attributable to equity            -         -          -          -  (15,549)  (15,549) 
Dividends                         -         -          -          - (146,772) (146,772) 
Balance at 31 March 2020  1,467,726 1,916,017    133,836    143,628 1,317,117 4,978,324 
for the year ended 31 March 2020 
                                                            31.3.20           31.3.19 
                                              Note                GBP                 GBP 
Cash flows from operating activities: 
Cash generated from operations                 I            346,847           325,587 
Interest paid                                                     -           (1,514) 
Tax paid                                                   (32,017)           (9,345) 
Net cash generated from operating activities                314,830           314,728 
Cash flows (used in)/from investing 
Purchase of property, plant and equipment                  (39,529)          (69,578) 
Disposal of fixed assets                                      2,250           299,495 
Interest received                                             1,990               303 
Net cash (used in)/from investing activities               (35,289)           230,220 
Cash flows used in financing activities 
Payments on right of use assets                            (19,316)                 - 
Dividends paid to shareholders                            (146,772)         (146,772) 
Net cash used in financing activities                     (166,088)         (146,772) 
Net increase in cash and cash equivalents                   113,453           398,176 
Cash and cash equivalents at beginning of                   642,466           244,290 
Cash and cash equivalents at end of year                    755,919           642,466 
All changes in liabilities arising from financing relate entirely to cash 
for the year ended 31 March 2020 
                                                            31.3.20           31.3.19 
                                                                  GBP                 GBP 
Operating profit - continuing operations                      3,009            43,705 
Depreciation charge                                          52,194            38,179 
Goodwill impairment                                         200,000           200,000 
Loss/(profit) on sale of fixed assets                         4,430         (162,338) 
Decrease in stock                                            52,255            72,478 
Decrease/(increase) in trade and other                       87,183           595,495 
(Decrease)/increase trade and other payables               (52,224)         (461,932) 
Cash generated from operations                              346,847           325,587 
Notes to the results announcement of PHSC plc 
The financial information set out above does not constitute the Group's 
financial statements for the years ended 31 March 2020 or 31 March 2019 but is 
derived from those financial statements. Statutory financial statements for 
2019 have been delivered to the Registrar of Companies and those for 2020 have 
been approved by the board and will be delivered after dispatch to 
shareholders. The auditors have reported on the 2019 and 2020 financial 
statements which carried an unqualified audit report, did not include a 
reference to any matters to which the auditor drew attention by way of emphasis 
and did not contain a statement under section 498(2) or 498(3) of the Companies 
Act 2006. 
While the financial information included in this announcement has been computed 
in accordance with International Financial Reporting Standards (IFRS), this 
announcement does not in itself contain sufficient information to comply with 
IFRS. The accounting policies used in preparation of this announcement are 
consistent with those in the full financial statements that have yet to be 
An interim dividend of GBP73,368 representing 0.5p per ordinary share was paid in 
February 2020 in respect of the year ended 31 March 2020. The board is 
proposing, subject to shareholder approval at the AGM, a final dividend of GBP 
73,386, representing 0.5p per ordinary share, to be paid on 16 October 2020, 
making a total dividend for the year of 1.0p. 

(END) Dow Jones Newswires

August 20, 2020 02:00 ET (06:00 GMT)

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