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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Ultimate Products Plc | LSE:ULTP | London | Ordinary Share | GB00BYX7MG58 | ORDS 0.25P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 1.00 | 0.56% | 180.00 | 180.00 | 184.50 | 180.00 | 180.00 | 180.00 | 54,603 | 10:55:31 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Household Appliance Stores | 166.32M | 12.59M | 0.1409 | 12.78 | 160.76M |
From Apr 2019 to Apr 2024
TIDMUPGS
RNS Number : 6970V
UP Global Sourcing Holdings PLC
07 November 2017
7 November 2017
UP Global Sourcing Holdings plc
"Ultimate Products" or the "Group"
FULL YEAR RESULTS FOR THE YEARED 31 JULY 2017
A strong performance in a challenging market
Ultimate Products, the owner, manager, designer and developer of an extensive range of value-focused consumer goods brands, announces its full year results for the year ended 31 July 2017.
Financial Highlights
-- Total revenue increased 39.1 % to GBP110.0 m (FY 16: GBP79.0 m); -- International revenue grew by 48.2 % to GBP30.4 m, representing 27.7 % of total revenue; -- Underlying EBITDA* increased 39.9 % to GBP11.5 m (FY 16: GBP8.2m); -- Underlying profit before tax* increased 42.0 % to GBP10.7 m (FY 16: GBP7.5 m); -- Profit before tax increased 18.7 % to GBP7.4m (FY16: GBP6.3m);
-- Net debt amounted to GBP6.0 m (FY 16: GBP10.0 m), with a net debt / underlying EBITDA ratio* of 0.5 x;
-- Underlying Earnings Per Share* of 10.9 p; and -- Full year dividend of 5.115 p per share (FY 16: 3.32 p).
*Items marked with an asterisk are non-GAAP measures. Definitions and relevant reconciliations are provided in the "Glossary".
Underlying measures are calculated after adding back exceptional items and share based payment charges as referred to in note 7 of the consolidated financial information below.
Operational Highlights
-- A Premium Listing of the Company on the Main Market of the London Stock Exchange in March;
-- Board substantially strengthened, including the appointment as Chairman of James McCarthy, the former CEO of Poundland Group plc, and two further independent Non-Executive Directors;
-- Refurbishment of new 240,000 sq ft warehouse at Heron Mill in Oldham completed to plan and is now the Group's main distribution facility, creating improved operational efficiencies and significant additional capacity;
-- Significant progress made in Germany, with a number of major retail accounts now open in the country and plans to open a showroom there in CY 18;
-- Highlights of the product portfolio have included the performance of Progress, the cookware and kitchen electrical brand, which is now listed with several retailers including, as of January 2018, a major UK supermarket; and
-- Recruited the 100th graduate to the Group's graduate development scheme.
Commenting on the results, Simon Showman, Chief Executive of Ultimate Products, said:
"I am very proud of what Ultimate Products and its staff have achieved over this reporting period. To deliver this performance whilst at the same time adding a new distribution centre, executing an IPO and maintaining an excellent service to our retailers shows what a high-quality, flexible and resilient business Ultimate Products is.
In the short-term, this flexibility and resilience will be needed as UK retailers and consumers alike adapt to a new and more challenging environment. However, it should also be noted that in a market where people have less money to spend on general merchandise, Ultimate Products provides a compelling proposition to consumers and retailers alike. We therefore continue to see substantial opportunities for the long-term growth and success of Ultimate Products."
For more information, please contact:
Hot Features
Premium
Ultimate Products +44 (0) 161 627 1400
Simon Showman, CEO
Andrew Gossage, Managing Director
Graham Screawn, Finance Director
Powerscourt +44 (0) 207 250 1446
Rob Greening
Isabelle Saber
Sam Austrums
Notes to Editors
Ultimate Products is an owner, manager, designer and developer of a series of well-known brands focused on the home, selling to over 300 retailers across 38 countries. It has six product categories: Audio; Heating and Cooling; Housewares; Laundry; Luggage; and Small Domestic Appliances. Its brands include Beldray (laundry, floor care, heating and cooling), Intempo (audio), Salter (kitchenware), Constellation (luggage), and Progress (cookware and bakeware).
The Group's products are sold to a broad cross-section of both large national and international multi-channel retailers as well as smaller national retail chains, incorporating discount retailers, supermarkets, general retailers and online retailers. Major customers include Action, Aldi, Amazon, Argos, Asda, B&M, Matalan, Morrisons, tofs (The Original Factory Shop), Robert Dyas, Sainsbury's, Tesco and The Range.
Founded in 1997, Ultimate Products is headquartered in Oldham, Greater Manchester, where it has design, sales, marketing, buying, quality assurance, support functions and warehouse facilities across two sites. Manor Mill, the Group's head office, includes a spectacular 20,000 sqft showroom that showcases each of its brands. In addition, the Group has an office and showroom in Guangzhou, China. In total, Ultimate Products now employs over 200 staff.
For further information, please visit www.upgs.com
BUSINESS REVIEW
Performance
Ultimate Products has delivered a strong financial performance this year, amid a period of significant change for the Group and against a backdrop of continuing economic turbulence. The business, along with many others, faced a number of challenges including significant cost inflation, the devaluation of Sterling against major currencies and the well documented uncertainty around Brexit negotiations following the General Election.
Group revenue rose 39.1 % to GBP110.0 m (FY 16: GBP79.0 m), and continued to be driven by three main factors:
1. growth in sales to discounters in the UK and in Europe (up 64.6 % to GBP63.8 m); 2. increased sales to the main UK supermarkets (up 95.0 % to GBP10.3 m); and 3. the emergence of online platforms as a new revenue for the business (up 63.6 % to GBP4.6 m).
Underlying Profit Before Tax* was up 42.0 % to GBP10.7 m. Gross Margin was down by 1.6 % at 22.3 % as a result of a higher mix of Free on Board ('FOB') business in the year and, for our Landed business, as a result of imported price inflation arising from a weakened Sterling. Despite this, our Underlying EBITDA Margin* held firm at 10.5 % (up 0.1 %). This reflects:
1. the economies of scale from higher revenues;
2. an increased proportion of FOB sales (which is less overhead intensive), partially offset by increased sales via online platforms (which is more overhead intensive); and
3. a more efficient operating model as the focus on the Group's brand portfolio, which has led to an increase in repeat sales and extended product life cycles.
Operational Overview
We have made solid operational progress across the business. The Group has continued to develop and expand the relationships with its core customer base of UK and European discounters. We have also made significant progress in Germany, with a number of major retail accounts opened and plans are well advanced to open a showroom there in CY 18.
Other international developments include a new landed supply arrangement with a major European customer. This allows the Group to expand beyond its current limited product offering with the customer into other product categories, representing an exciting opportunity to continue to grow alongside one of the fastest expanding retailers in Europe, further cementing the Group's position as a key supplier to it.
A particular highlight of the Group's branded product portfolio during the period has been the performance of Progress, the cookware and kitchen electrical brand, which is now listed with several retailers including, as of January 2018, a major UK supermarket.
As noted above, revenue from online channels grew in the year by 63.6 % to GBP4.6 m and, while still a relatively small proportion of overall revenue at the moment, it is increasing in importance. Online is an exciting and fast growing part of the business and we are optimistic about its future prospects.
We are seeing some cost pressures coming through from China, where the bulk of our product is sourced. This has been caused by the strengthening of the Chinese currency and local regulatory changes. However, we are confident in our ability to effectively manage this because of our experience over many years in that territory and strong local presence through our office in Guangzhou.
Finally, the refurbishment of Ultimate Products' new 240,000 sq ft warehouse at Heron Mill in Oldham has been completed to plan and is now the Group's main distribution facility. The Board anticipates that this will create improved operational efficiencies and significant additional capacity to manage the future growth of the business.
Initial Public Offering
On 6 March 2017, the Group was admitted to the premium segment of the Official List of the Financial Conduct Authority and to trading on the Main Market of the London Stock Exchange plc. This was a significant step forward for the development of the business and a substantial achievement for the management team and staff. We believe that our listed company status provides the right platform for the future growth of the business and further enhances our reputation with customers and supplier partners.
We recognise that the future prospects of the business are reliant on both retaining our very best talent and recruiting new colleagues to the business that have the same potential and attitude as our very best. Accordingly, we are creating development programmes for rising stars and have already put in place various incentive schemes that reward outperformance.
Dividend
The Board is committed to a progressive dividend policy, with an intention to distribute 50 % of the Group's adjusted profit after tax. A final dividend is recommended of 3.495 p per share to give a total dividend of 5.115 p per share for the full year.
The final dividend is payable on 30 January 2018 to shareholders on the register on 5 January 2018.
Board Appointments
The Group's Board has been substantially strengthened through the appointments of James McCarthy as Chairman, Alan Rigby as Senior Independent Non-Executive Director and Robbie Bell as Non-Executive Director.
James McCarthy has over 40 years' experience in the fast-moving retail industry, having previously held the position of Chief Executive Officer of Poundland. He stepped down in September 2016 after a decade-long tenure during which the company's sales grew from GBP300 m to GBP1.3 bn per annum, whilst the number of stores increased from 150 to over 900. Prior to joining Poundland, James was Managing Director of Convenience at J Sainsbury plc and was a member of the company's operating, retail and investment boards.
Alan Rigby has spent the majority of his working career at HSBC plc, joining in 1975 and gaining broad experience through a range of management positions, including credit and risk, retail, commercial, large corporate and global banking markets.
Robbie Bell is the Chief Financial Officer of Welcome Break. Prior to that, he was the Chief Financial Officer of Screwfix, a subsidiary of Kingfisher plc. He was previously the UK Finance Director of Travelodge between 2006 and 2008, having started his career at Whitbread plc before moving to Tesco plc.
Graduate & Apprenticeship Schemes
The Group's Graduate Development Scheme continues to be highly successful in recruiting and developing talented graduates, through entry-level positions, across all of our key departments within the UK head office. This year it recruited its 100th graduate and the scheme continues to be the main driver for our recruitment strategies. Over 50 % of the current UK office workers have now come through the scheme.
This year also saw the introduction of an apprenticeship scheme, which provides further opportunities for young, talented individuals to join our dynamic working environment whilst meeting compliance with the government's apprenticeship levy. So far, we have piloted the scheme with two apprentices and links are being formed with local educational establishments in order to develop the scheme further
Outlook & Market Environment
The Group operates primarily in the branded, value-focused consumer goods sector in the UK. Due to ongoing macroeconomic uncertainty and tougher trading conditions, retailers are generally exercising caution with regard to their non-food buying as we head towards the end of the calendar year.
As a result, we are seeing retailers' reluctance to order too far forward and many are placing orders later or buying from stock. The lower volumes available to non-food suppliers and retailers' desire to minimise increases in retail prices is creating an even more competitive environment than normal.
As previously announced, the Board therefore anticipates that revenue growth for FY 18 is unlikely. In addition, approximately GBP4-5 m of FY 18's revenue will now be recognised in FY 19 as a result of the move from FOB to landed arrangements with a key European customer.
However, Ultimate Products is used to managing such challenging dynamics. Current trading is in line with expectations and the Board remains confident that the business will continue to deliver sustainable, long-term growth.
FINANCIAL REVIEW
Overview
FY 17 FY 16 Change
----------------------------- -------- -------- -----------
Revenue (GBP'm) 110.0 79.0 +39.1 %
Gross margin 22.3 % 23.9 % -160bps
Underlying EBITDA (GBP'm)* 11.5 8.2 +39.9 %
Underlying EBITDA margin* 10.5 % 10.4 % + 10bps
Underlying profit for 8.4 5.9 +42.6 %
the year (GBP'm)*
Net cash from operations 9.4 3.7 +157.4
(GBP'm) %
Free cash flow (GBP'm)* 7.8 0.7 +1,030.9
%
Net debt (GBP'm)* 6.0 10.0 - GBP4.0m
Net debt/Underlying 0.5 x 1.2 x -58.3 %
EBITDA ratio*
Underlying earnings 10.9 8.0 +36.3 %
per share (p)*
----------------------------- -------- -------- -----------
Underlying performance measures exclude the exceptional items and share based payment charges referred to in note 7 to the consolidated financial information and are commented on below.
Revenue
The Group experienced strong revenue growth in FY 17, increasing by 39.1 % to GBP110.0 m with above double-digit growth in all key product groups and brands. The revenue performance was driven by three main factors: growth in sales to discounters in the UK and in Europe (up 64.6 % to GBP63.8 m); increased sales from the main UK supermarkets (up 95.0 % to GBP10.3 m); and the emergence of online platforms as a new revenue for the business (up 63.6 % to GBP4.6 m).
Focus on international expansion commenced during the second half of FY 17 and has therefore not had a significant impact on the FY 17 results. However, international sales grew by 48.2 % to GBP30.4 m and now represent 27.7 % of total sales (FY 16: 26.0 %), with UK sales growing by 35.9 % to GBP79.5 m (FY 16: GBP58.5 m).
Brands
The Group introduced its strategy to concentrate on offering branded, mass-market and value-led consumer goods in late 2013. Since then, the Group has seen its brands take an increasingly significant share of sales and this pattern continued in FY 17. A summary of the Premier Brands, representing 60.0 % of total revenue (FY 16: 55.4 %) is set out below:
FY 17 FY 16 Growth
GBP'm GBP'm %
Beldray 30.8 19.1 +61.1
Salter 16.0 12.1 +32.8
Intempo 10.0 5.9 +72.1
Russell Hobbs 8.5 6.7 +26.2
Progress 0.6 0.0 N/A
----------------- -------- -------- --------
65.9 43.8 +50.6
================= ======== ======== ========
Of particular note in the Premier Brands segment is the addition of Progress, a brand of Lancastrian heritage. Since its acquisition in 2015, the initial focus has been on developing the product range and packaging primarily across the housewares and small domestic appliance product categories. The Directors are excited about the potential for the brand, which now has listings in a number of retailers including a major supermarket from January 2018.
Margins
Gross margin was 160 bps lower than 2016, influenced by two key factors: firstly FOB sales, which typically generate lower gross margin but require lower overheads to serve, increased from 60.2 % of sales to 67.6 % and secondly, gross margin on landed sales, whilst partially protected by existing hedging contracts, were impacted by cost pressures from the fall in the US$ exchange rate with GBP after the Brexit referendum. However, continued operating efficiency benefits and lower overhead growth, supported by the aforementioned lower overhead requirement for FOB, resulted in the Group increasing its underlying EBITDA margin by 10 bps to 10.5 %.
Overheads
Administration expenses excluding exceptional items and share based payment charges, substantially comprising wages and salary costs, increased by GBP2.5 m (22.6 %) to GBP13.4 m in FY 17 compared to the 39.1 % increase in revenue. As experienced with the revenue growth in recent years, in FY 17 the Group continued to leverage its overhead resource to absorb growth with less than proportionate cost growth. This was achieved whilst absorbing the incremental impact of a full year's property cost of the new Heron Mill distribution facility (FY 16: 3.5 months) and the addition of plc related costs since the Group's IPO in March.
Over the course of FY 17, the average number of employees increased by 41 (or 22.7 %) of which 17 related to structural changes both in the UK warehouse and in the Far East, where new positions were created to replace third-party costs. Other headcount increases were in the core UK operations and the Group is particularly proud of its Graduate Development Scheme. This is the first port of call for most incremental positions and we are delighted with the progress we have made in developing and promoting staff from within the business, many of whom are recruited from the local Oldham area.
Exceptional Items and share based payment charges
Such costs include the non-recurring costs relating to the IPO of GBP1.1 m (FY 16: GBPnil), the legacy shareholder bonuses that ceased to accrue after 31 July 2017, being GBP2.0 m (FY 16: GBP1.2m), and the non-cash, share based payment expense relating to the Management Incentive Plan introduced immediately prior to the IPO, being GBP0.1 m (FY 16: GBPnil). They have been shown separately in the Income Statement to better reflect the performance of the underlying business.
Interest
At GBP0.5 m, finance costs were at similar levels to FY 16, although interest paid was significantly lower as FY 16 cash flows included the payment of GBP2.0 m of accrued interest relating to loan notes that were fully repaid in FY 16.
Taxation
The effective underlying tax rate has reduced from 21.5 % to 21.1 % for FY 17 and this is in line with expectations, given the reduction in the rate of UK corporation tax to 19 % with effect from 1 April 2017.
As explained in note 17 to the consolidated financial information below, the 2014 EMI Scheme share options were exercised immediately prior to the IPO. A statutory corporation tax deduction is created by the exercise of the EMI options, reducing the current and prior year tax liability by a total of GBP2.1 m. In accordance with IFRS 2, Accounting for Share based Payments, the GBP2.1 m tax credit has been credited directly to the Statement of Changes in Equity, rather than through the Income Statement. The impact of the deduction has been to reduce the GBP1.6 m UK corporation tax liability for the year to nil, with a further GBP0.5 m recoverable against the FY 16 liability previously paid.
Balance Sheet and Cash Flow
The Group's balance sheet strengthened significantly over the year with net assets increasing by GBP5.6 m to GBP6.8 m. The key points to note regarding the balance sheet can be summarised as:
-- The increase in non-current assets of GBP0.7 m was driven by capital expenditure on the refurbishment of Heron Mill (GBP0.8 m in FY 17), which has now become the Group's main distribution facility.
-- Having over-proportionately increased inventories by 36.4 % in FY 16, the increase in FY 17 was substantially lower than revenue growth at 4.9 %. This also reflects the higher mix of FOB sales, where revenue is recognised as the goods are handed over to the customer in the country of origin without being held in inventories prior to sale.
-- Trade and other receivables reduced by GBP4.5 m (27.6 %) compared to FY 16, (GBP4.2 m relating to trade receivables), driven by an exceptionally low level of debtor days at 31 July 2017 of 36, with the comparative 31 July 2016 and 31 July 2015 levels being 52 days and 50 days respectively. The reduction was driven by a favourable customer mix of invoicing at the end of FY 17. This is an exceptional movement that would be expected to reverse in FY 18.
-- Trade and other payables are GBP3.9 m lower than last year, which included GBP2.25 m for the interim FY 16 dividend declared but not paid at the end of FY 16. Additionally, trade payables are GBP1.6 m lower than FY 16, as last year saw a significantly higher increase in inventories just prior to the year end, with a corresponding increase to trade payables.
-- Current tax is a GBP0.5 m debtor in FY 17 due to the EMI scheme corporation tax credit referred to in the 'taxation' comments above.
The GBP4.2 m lower trade receivables, commented on earlier, provides a flattering, although exceptional impact on the net cash from operations that would be expected to reverse in FY 18. This favourable reduction, along with lower UK corporation tax payments (due to the EMI Scheme tax credit, creating a cash flow benefit of GBP0.8 m in FY 17) and a GBP1.3 m increase in EBITDA, are reflected in the net cash from operations of GBP9.4 m, which is GBP5.7 m higher than last year.
2017 2016
GBP'm GBP'm
Net cash from operations 9.4 3.7
Net capital expenditure (1.1) (0.7)
Interest paid (0.5) (2.3)
--------------------------- -------- --------
Free cash flow* 7.8 0.7
=========================== ======== ========
After deducting capital expenditure and returning to a normal level of interest payments, with the repayment of the loan notes made in FY 16, free cash flow* amounted to GBP7.8 m for FY 17. The payment of dividends and minor other items then resulted in a GBP4.0 m reduction in net debt* to GBP6.0 m (FY16: GBP10.0 m), with the net debt/underlying EBITDA ratio reducing 58.3 % to 0.5 x (FY 16: 1.2 x).
Financing and Going Concern
The Group is financed by a suite of trade and revolving credit facilities provided by HSBC Bank plc, further information on which is provided in note 15 to the consolidated financial information below. Over the course of the year, the Group has operated well within the covenants to the banking facilities and has maintained comfortable levels of funding headroom, with headroom at 31 July 2017 in excess of GBP6 m. The Group's projections show that the Group will be able to operate within its existing banking facilities and covenants. The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future and, as such, has applied the going concern principle in preparing the Annual Report and Financial Statements.
James McCarthy Simon Showman Chairman Chief Executive
Consolidated Income Statement
Year
ended
Year 31 July
ended 2016
31 July (Restated)
2017
Note GBP'000 GBP'000
-------------------------------- ------ ---------- ------------
Continuing Operations
Revenue 6 109,953 79,028
Cost of sales (85,386) (60,114)
-------------------------------- ------ ---------- ------------
Gross profit 24,567 18,914
-------------------------------- ------ ---------- ------------
Administration expenses before
exceptional items and share
based payment charges (13,444) (10,968)
-------------------------------- ------ ---------- ------------
Profit from operations before
exceptional items and share
based payment charges 11,123 7,946
Exceptional administration
expenses 7 (3,152) (1,246)
Share based payment charges 7 (80) -
-------------------------------- ------ ---------- ------------
Administration expenses (16,676) (12,214)
-------------------------------- ------ ---------- ------------
Profit from operations 7,891 6,700
Finance costs 8 (464) (441)
-------------------------------- ------ ---------- ------------
Profit before taxation 7,427 6,259
Income tax 9 (1,852) (1,361)
-------------------------------- ------ ---------- ------------
Profit for the period 5,575 4,898
================================ ====== ========== ============
Pence Pence
-------------------------------- ------ ---------- ------------
Earnings per share - basic 10 7.2 6.6
Earnings per share - diluted 10 7.1 6.6
================================ ====== ========== ============
Consolidated Statement of Comprehensive Income
Year Year
ended ended
31 July 31 July
2017 2016
GBP'000 GBP'000
-------------------------------------- --------- ---------
Profit for the period 5,575 4,898
Other comprehensive (expense)/income
Items that may subsequently be
reclassified to income statement:
Fair value movements on cash flow
hedging instruments (193) 441
Hedging instruments recycled through (441) -
the income statement at the end
of hedging relationships
Foreign currency retranslation 1 19
-------------------------------------- --------- ---------
Other comprehensive (expense)/income
for the period (633) 460
====================================== ========= =========
Total comprehensive income for
period attributable to the equity
holders of the company 4,942 5,358
====================================== ========= =========
Consolidated Statement of Financial Position
As at As at
31 July 31 July
Note 2017 2016
GBP'000 GBP'000
-------------------------------- -------- --------- ------------
Assets
Property, plant and equipment 12 1,715 970
Deferred tax 162 209
--------------------------------- -------- --------- ------------
Total non-current assets 1,877 1,179
Inventories 11,064 10,545
Trade and other receivables 13 11,745 16,231
Current tax 481 -
Cash and cash equivalents 91 136
--------------------------------- -------- --------- ------------
Total current assets 23,381 26,912
--------------------------------- -------- --------- ----------
Total assets 25,258 28,091
--------------------------------- -------- --------- ----------
Liabilities
Trade and other payables 14 (12,516) (16,403)
Current tax - (478)
Borrowings 15 (1,518) (7,132)
--------------------------------- -------- --------- ------------
Total current liabilities (14,034) (24,013) --------------------------------- -------- --------- ------------ Net current assets 9,347 2,899 Borrowings 15 (4,431) (2,884) --------------------------------- -------- --------- ------------ Total non-current liabilities (4,431) (2,884) --------------------------------- -------- --------- ------------ Total liabilities (18,465) (26,897) --------------------------------- -------- --------- ------------ Net assets 6,793 1,194 ================================= ======== ========= ============ Equity Share capital 17 205 184 Share premium 2 2 Hedging reserve (193) 441 Retained earnings 6,779 567 --------------------------------- -------- --------- ------------ Equity attributable to owners of the company 6,793 1,194 ================================= ======== ========= ============
Consolidated Statement of Changes in Equity
Share Capital Share Premium Capital reserve Hedging reserve Retained earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 Equity
GBP'000
------------------- -------------- -------------- ---------------- ---------------- ------------------ ---------
As at 1 August
2015 185 12,322 4,909 - (14,422) 2,994
Profit for the
year - - - - 4,898 4,898
Foreign currency
retranslation - - - - 19 19
Cash flow hedging
movement - - - 441 - 441
Total
comprehensive
income for the
year - - - 441 4,917 5,358
------------------- -------------- -------------- ---------------- ---------------- ------------------ ---------
Transactions with
shareholders:
Dividends payable - - - - (2,250) (2,250)
Capital reduction (1) (12,320) - - 12,322 1
Repayment of loan
notes - - (4,909) - - (4,909)
------------------- -------------- -------------- ---------------- ---------------- ------------------ ---------
As at 31 July 2016 184 2 - 441 567 1,194
=================== ============== ============== ================ ================ ================== =========
Share Capital Share Premium Capital reserve Hedging reserve Retained earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 Equity
GBP'000
------------------- -------------- -------------- ---------------- ---------------- ------------------ ---------
As at 1 August
2016 184 2 - 441 567 1,194
Profit for the
year - - - - 5,575 5,575
Foreign currency
retranslation - - - - 1 1
Cash flow hedging
movement - - - (634) - (634)
------------------- -------------- -------------- ---------------- ---------------- ------------------ ---------
Total
comprehensive
income for the
year - - - (634) 5,576 4,942
------------------- -------------- -------------- ---------------- ---------------- ------------------ ---------
Transactions with
shareholders:
Dividends payable - - - - (1,530) (1,530)
Issue of shares -
exercise of share
options 21 - - - - 21
Share based
payments - - - - 80 80
Current tax on
share schemes - - - - 2,086 2,086
------------------- -------------- -------------- ---------------- ---------------- ------------------ ---------
As at 31 July 2017 205 2 - (193) 6,779 6,793
=================== ============== ============== ================ ================ ================== =========
Consolidated Statement of Cash Flows
Year Year
ended ended
31 July 31 July
2017 2016
GBP'000 GBP'000
--------------------------------- --------- ---------
Net cash flow from operating
activities
Profit for the period 5,575 4,898
Adjustments for:
Finance costs 464 441
Gain on disposal of non-current (5) -
assets
Income tax expense 1,852 1,361
Depreciation and impairment 394 280
Share based payments 80 -
Income taxes paid (678) (1,309)
Working capital adjustments
Increase in inventories (519) (2,815)
Decrease/(increase) in trade
and other receivables 4,049 (4,740)
(Decrease)/increase in trade
and other payables (1,790) 5,545
Net cash from operations 9,422 3,661
----------------------------------- --------- ---------
Cash flows used in investing
activities
Purchase of property, plant
and equipment (1,162) (652)
Proceeds from disposal of 28 -
property, plant and equipment
--------------------------------- --------- ---------
Net cash used in investing
activities (1,134) (652)
----------------------------------- --------- ---------
Cash flows used in financing
activities
Purchase of own shares - (18)
Issue of share capital 21 -
Proceeds from borrowings - 8,891
Repayment of borrowings (4,085) (3,294)
Repayment of loan notes - (6,059)
Debt issue costs paid (38) (142)
Dividends paid (3,780) -
Interest paid (451) (2,316)
----------------------------------- --------- ---------
Net cash used in finance
activities (8,333) (2,938)
----------------------------------- --------- ---------
Net (decrease)/increase in
cash and cash equivalents (45) 71
Cash and cash equivalents
brought forward 136 58
Exchange gains on cash and
cash equivalents - 7
Cash and cash equivalents
carried forward 91 136
=================================== ========= =========
Notes to the Consolidated Financial Information
1. General Information
UP Global Sourcing Holdings plc ('the Company') and its subsidiaries (together 'the Group') is a supplier of branded, value-for-money household products to global markets.
The Company is a public limited company, which is listed on the London Stock Exchange and incorporated and domiciled in the UK. The address of its registered office is UP Global Sourcing Holdings plc, Manor Mill, Victoria Street, Chadderton, Oldham OL9 0DD UK.
This consolidated financial information does not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. On 6 March 2017, the Company was admitted to the premium segment of the Official List of the Financial Conduct Authority and to trading on the main market of the London Stock Exchange. The Prospectus for the Initial Public Offering contains the audited Historical Financial Information of the Company on pages 84 to 124 (the "Historical Financial Information") presented under International Financial Reporting Standards ("IFRS"). Other than the reclassification referred to in note 8 below, the comparative figures for the financial year ended 31 July 2016 are an extract of the Company's Historical Financial Information for that year. Statutory accounts for the year ended 31 July 2016, prepared under Financial Reporting Standard 102, were approved by the Board of Directors on 31 October 2016 and delivered to the Registrar of Companies. The report of the auditor on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under section 498 (2) or (3) of the Companies Act 2006. Note 31 of the Historical Financial Information refers to the transition to IFRS from 1 August 2013 and sets out the main items contributing to the change in financial information compared with that reported under UK GAAP as at the transition date.
The statutory accounts for the year ended 31 July 2017 will be delivered to the Registrar of Companies following the Company's Annual General Meeting. The Auditors have reported on those accounts; their report was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under section 498 (2) or (3) of the Companies Act 2006.
2. Basis of Preparation
The consolidated financial information is derived from the Group's consolidated financial statements for the year ended 31 July 2017, have been prepared in accordance with International Financial Reporting Standards (IFRS), as endorsed by the European Union (EU) and those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements have been prepared on the historical cost basis, except for certain financial instruments and share based payments that have been measured at fair value.
Going Concern Basis
The Group meets its day-to-day working capital requirements through its bank facilities. After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. The Group's forecasts and projections, taking account of reasonable sensitivities, show that the Group should be able to operate within available facilities. The Group therefore continues to adopt the going concern basis in preparing its consolidated and company Financial Statements.
3. Accounting Policies
The accounting policies applied are consistent with those of the Historical Financial Information for the year ended 31 July 2016.
4. Operating Segments
Operating segments are reported in a manner that is consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker has been identified as the Board. The Board is responsible for allocating resources and assessing performance of operating segments.
The Directors consider that there are no identifiable business segments that are subject to risks and returns that are different to those of the core business. The information reported to the Directors, for the purposes of resource allocation and assessment of performance, is based wholly upon the overall activities of the Group. The Group has therefore determined that it has only one reportable segment under IFRS 8.
The results and assets for this segment can be determined by reference to the Statement of Comprehensive Income and Statement of Financial Position.
5. Financial Instruments
The Group's activities expose it to a variety of financial risks: market risk (including foreign exchange risk, cash flow and fair value interest rate risk and price risk), credit risk and liquidity risk.
The consolidated financial information should be read in conjunction with the Group's Historical Financial Information as they do not include all financial risk management information and disclosures contained within the Historical Financial Information. There have been no changes in the risk management policies since the year end.
6. Revenue
Geographical Split by Location:
Year Ended Year Ended
31 July 2017 31 July 2016
GBP'000 GBP'000
------------------- -------------- --------------
United Kingdom 79,534 58,504
Europe 27,285 17,259
USA 806 628
Rest of the World 2,328 2,637
-------------------- -------------- --------------
Total 109,953 79,028
==================== ============== ==============
Analysis of Revenue by Brand:
Year Ended Year Ended
31 July 2017 31 July 2016
GBP'000 GBP'000
---------------------------- -------------- --------------
Beldray 30,762 19,100
Salter 16,055 12,086
Intempo 10,053 5,843
Russell Hobbs 8,480 6,720
Progress 588 38
----------------------------- -------------- --------------
Premier brands 65,938 43,787
Other key brands 9,874 9,000
----------------------------- -------------- --------------
Key brands total 75,812 52,787
Other brands and own label 34,141 26,241
----------------------------- -------------- --------------
Total 109,953 79,028
============================= ============== ==============
Analysis of Revenue by Major Products:
Year Ended Year Ended
31 July 2017 31 July 2016
GBP'000 GBP'000
--------------------------- -------------- --------------
Small domestic appliances 24,632 20,820
Audio 23,710 13,048
Housewares 22,219 15,633
Laundry 15,760 7,974
Heating and cooling 7,430 4,454
Luggage 5,160 4,561
Others 11,042 12,538
Total 109,953 79,028
============================ ============== ==============
Analysis of Revenue by Strategic Pillar:
Year Ended Year Ended
31 July 2017 31 July 2016
GBP'000 GBP'000
-------------------- -------------- --------------
Discount retailers 63,781 38,742
UK supermarkets 10,339 5,301
Online channels 4,568 2,793
--------------------- -------------- --------------
78,688 46,836
Other 31,265 32,192
Total 109,953 79,028
===================== ============== ==============
7. Exceptional items & share based payment charges
Year Ended Year Ended
31 July 2017 31 July 2016
GBP'000 GBP'000
-------------------------------- --- -------------- --------------
Shareholder bonuses 2,003 1,246
Initial public offering costs 1,149 -
Share based payment expense 80 -
Total 3,232 1,246
===================================== ============== ==============
Shareholder bonus costs consist of bonus payments based upon certain Group EBITDA performance targets and the cost ceased to accrue after the year ended 31 July 2017.
Initial public offering costs relate entirely to the Group's IPO in the year and therefore are not considered to relate to the Group's underlying performance. The costs incurred comprise principally legal and advisory fees and listing costs.
The share based payment expense relates to the non-cash charge arising on a share option management incentive plan adopted immediately prior to the IPO. The options have been valued using the Monte Carlo option pricing model and are granted with a three-year vesting period and can be exercised up to seven years following the vesting date.
The above items have been shown separately in the Income Statement to better reflect the performance of the underlying business.
8. Operating Expenses
Year Ended
Year Ended 31 July 2016
31 July 2017 (Restated)
GBP'000 GBP'000
------------------------------------------------------------ --- --------------- --------------
The profit is stated after charging/(crediting)
expenses as follows:
Exceptional items and share based payment charges - note 7 3,232 1,246
Depreciation of owned property, plant and equipment 394 280
Gain on disposal of property, plant and equipment (5) -
================================================================= =============== ==============
In the year ended 31 July 2017, the Directors have taken the decision to reclassify to cost of sales, certain costs that had previously been reported as part of both distribution costs and administrative expenses. The Directors believe that the reclassification will better reflect the actual gross margin realised on items sold. The impact on the 2016 year end is the reclassification of GBP1,194,000 from distribution costs and the reclassification of GBP556,000 from administrative expenses. The result has been an increase in cost of sales of GBP1,750,000. This restatement has had no impact upon previously reported profit or equity.
9. Taxation
Year Ended Year Ended
31 July 2017 31 July 2016
GBP'000 GBP'000
--------------------------------------------------- -------------- --------------
Current tax
Current period - UK corporation tax 1,629 1,167
Adjustments in respect of prior periods 5 40
Foreign current tax expense 171 111
---------------------------------------------------- -------------- --------------
Total current tax 1,805 1,318
==================================================== ============== ==============
Deferred tax
Origination and reversal of temporary differences 40 28
Adjustments in respect of prior periods (7) -
Impact of change in tax rate 14 15
---------------------------------------------------- -------------- --------------
Total deferred tax 47 43
---------------------------------------------------- -------------- --------------
Total tax charge 1,852 1,361
==================================================== ============== ==============
Factors Affecting the Tax Charge
Tax is assessed for the period at a rate different to the UK corporation tax rate for the reasons below:
Year Ended Year Ended
31 July 2017 31 July 2016
GBP'000 GBP'000
---------------------------------------------------------------- -------------- --------------
Profit before tax 7,427 6,259
Tax charge at 19.67% (2016 - 20%) 1,461 1,252
Recurring:
Adjustment to tax charge in respect of prior periods (2) (9)
Effects of expenses not deductible for tax purposes 63 52
Impact of overseas tax rates 87 58
Effect of difference in corporation tax and deferred tax rates 9 11
Deferred tax not recognised - (3)
Non-recurring:
Effects of expenses not deductible for tax purposes 234 -
Total tax expense 1,852 1,361
================================================================= ============== ==============
Included in the tax charge above is a tax credit relating to the exceptional items of GBP401,000 (2016 - GBP249,000).
A tax credit of GBP2,086,000 has been credited direct to reserves in relation to the EMI scheme.
Factors That May Affect Future Tax Charges
Changes to the UK corporation tax rates were announced in the Chancellor's Budget on 8 July 2015. These included reductions to the main rate to reduce the rate to 19 % from 1 April 2017 and to 18 % from 1 April 2020. Further reductions were announced in the Chancellor's Budget on 16 March 2016, including a reduction in the main rate of corporation tax to 17 % from 1 April 2020.
10. Earnings per Share
Basic earnings per share is calculated by dividing the net income for the period attributable to ordinary equity holders by the weighted average number of ordinary shares outstanding during the period, and uses the number of shares as if they had always been subdivided from GBP1 shares to 0.25p shares.
Diluted earnings/(losses) per share amounts are calculated by dividing the profit/(loss) attributable to owners of the parent by the weighted average number of ordinary shares in issue during the financial year, adjusted for the effects of potentially dilutive options. The dilutive effect is calculated on the full exercise of all potentially dilutive ordinary share options granted by the Group, including performance-based options which the Group considers to have been earned.
The calculations of earnings per share are based upon the following:
Year Ended Year Ended
31 July 2017 31 July 2016
GBP'000 GBP'000
--------------------------------------------- -------------- --------------
Profit for the period 5,575 4,898
---------------------------------------------- -------------- --------------
Number Number
--------------------------------------------- -------------- --------------
Weighted average number of shares - basic 77,254,220 73,863,084
Share options 946,812 -
--------------------------------------------- -------------- --------------
Weighted average number of shares - diluted 78,201,032 73,863,084
---------------------------------------------- -------------- --------------
Pence Pence
--------------------------------------------- -------------- --------------
Profit per share - basic 7.2 6.6
============================================== ============== ==============
Profit per share - diluted 7.1 6.6
============================================== ============== ==============
11. Dividends
Year Ended Year Ended
31 July 2017 31 July 2016
GBP'000 GBP'000
--------------------------------------------------------------- -------------- --------------
Interim declared - 2,250
Final dividend paid in respect of the year ended 31 July 2016 199 -
Interim declared and paid 1,331 -
--------------------------------------------------------------- -------------- --------------
1,530 2,250
=============================================================== ============== ==============
Per share - (adjusted to reflect the subdivision in note 17) Pence Pence
--------------------------------------------------------------- -------------- --------------
Interim dividend declared - 3.05
Final dividend paid in respect of the year ended 31 July 2016 0.27 -
Interim declared and paid 1.62 -
--------------------------------------------------------------- -------------- --------------
1.89 3.05
=============================================================== ============== ==============
The interim dividend declared in the year ended 31 July 2016 was paid in the year ended 31 July 2017. An interim dividend of 1.62 p per share was approved by the board on 27 April 2017 and was paid on 28 July 2017 to shareholders on record as at 7 July 2017.
The Directors have proposed a final dividend of 3.495 p per share in respect of the year ended 31 July 2017. The dividend is due to be payable on 30 January 2018 to shareholders on record at 5 January 2018.
12. Property, Plant & Equipment
GBP'000
------------------------
Opening net book value 970
Additions 1,162
Disposals (23)
Depreciation (394)
As at 31 July 2017 1,715
========================== ========
Additions to property, plant and equipment in the year ended 31 July 2017 substantially relate to the refurbishment of Heron Mill, the Group's new warehousing facility.
13. Trade & Other receivables
31 July 31 July
2017 2016
GBP'000 GBP'000
----------------------- -------- --------
Trade receivables 10,474 14,686
Other receivables and
prepayments 1,271 1,545
------------------------- -------- --------
11,745 16,231
======================= ======== ========
The Directors believe that the carrying value of trade and other receivables represents their fair value. Trade and other receivables are denominated in Sterling, US Dollars, Euros and Canadian Dollars. In determining the recoverability of trade receivables, the Group considers any change in the credit quality of the receivable from the date credit was granted up to the reporting date.
14. Trade & Other payables
31 July 31 July
2017 2016
GBP'000 GBP'000
Trade payables 5,803 7,420
Accruals and deferred
income 6,207 5,670
Employee tax and social
security 506 1,063
Other payables - 2,250
--------------------------- -------- --------
12,516 16,403
========================= ======== ========
The Directors consider that the carrying value of trade and other payables approximates their fair value. Trade and other payables are denominated in both Sterling and US Dollars. UP Global Sourcing Holdings plc has financial risk management policies in place to ensure that all payables are paid within the credit timeframe and no interest has been charged by any suppliers as a result of late payment of invoices during the period.
15. Borrowings
31 July 31 July
2017 2016
GBP'000 GBP'000
---------------------------------- -------- --------
Current
Bank overdraft and invoice
discounting 1,016 3,198
Import loans 534 3,976
1,550 7,174
Less: Unamortised debt
issue costs (32) (42)
----------------------------------- -------- --------
1,518 7,132
=================================== ======== ========
Non-current
Revolving credit facility 4,499 2,959
----------------------------------- -------- --------
4,499 2,959
Less: Unamortised debt
issue costs (68) (75)
----------------------------------- -------- --------
4,431 2,884
=================================== ======== ========
Total borrowings 5,949 10,016
=================================== ======== ========
The earliest that the
lenders of the above borrowings
require repayment is as
follows:
In less than one year 1,550 7,174
Between two and five years 4,499 2,959
Less: Unamortised debt
issue costs (100) (117)
----------------------------------- -------- --------
5,949 10,016
=================================== ======== ========
The Group is funded by external banking facilities provided by HSBC. On 22 July 2016, the Group refinanced and entered into new banking facilities with HSBC. The new facilities run to June 2020, providing the ongoing funding of the Group and comprise a revolving credit facility of GBP6.2 m, an invoice discounting facility, the limit of which was increased by GBP2 m on 27 January 2017 to GBP17 m and an import loan facility, which was increased by GBP1.75 m to GBP6.5 m on 22 June 2017. The import loan facility is ancillary to the revolving credit facility, is repayable on demand and subject to annual review.
16. Financial Instruments
Principal Financial Instruments
The principal financial instruments used by the Group, from which financial instrument risk arises are as follows:
31 July 2017 31 July 2016
GBP'000 GBP'000
----------------------------- ------------- -------------
Trade and other receivables 10,491 15,159
Trade and other payables 12,010 15,340
Borrowings 5,949 10,016
Cash and cash equivalents 91 136
============================== ============= =============
Financial Assets
The Group held the following financial assets at amortised cost:
31 July 2017 31 July 2016
GBP'000 GBP'000
--------------------------- --- ------------- -------------
Cash and cash equivalents 91 136
Trade receivables 10,474 14,686
--------------------------------
10,565 14,822
=============================== ============= =============
Financial Liabilities
The Group held the following financial liabilities, classified as other financial liabilities at amortised cost:
31 July 2017 31 July 2016
GBP'000 GBP'000
----------------- --- ------------- -------------
Trade payables 5,803 7,420
Loans 5,949 10,016
Other payables 6,207 7,870
----------------------
17,959 25,306
===================== ============= =============
Financial Assets/(Liabilities)
The Group held the following financial assets/(liabilities), classified as fair value through profit and loss on initial recognition:
31 July 2017 31 July 2016
GBP'000 GBP'000
---------------------------- --- ------------- -------------
Forward currency contracts (200) 417
Interest rate swaps 4 (13)
Interest rate caps 13 19
(183) 423
================================ ============= =============
Derivative Financial Instruments - Forward Contracts
The Group mitigates the exchange rate risk for certain foreign currency trade debtors and creditors by entering into forward currency contracts. At 31 July 2017, the outstanding contracts all mature within 12 months of the period end (2016 - 10 months). At 31 July 2017, the Group was committed to buy $11,650,000, to sell $3,500,000, to sell EUR7,050,000 and to sell CA $nil, paying and receiving respectively a fixed Sterling amount (2016 - to buy $10,000,000, to sell $nil, to sell EUR850,000 and to sell CA$85,000). The forward currency contracts are measured at fair value using the relevant exchange rates for GBP:USD, GBP:EUR and GBP:CA$. The fair value of the contracts at 31 July 2017 is a liability of GBP200,000 (2016 - GBP417,000 asset).
Forward currency contracts are valued using level 2 inputs. The valuations are calculated using the period end forward rates for the relevant currencies, which are observable quoted values at the period end dates. Valuations are determined using the hypothetical derivative method, which values the contracts based upon the changes in the future cash flows, based upon the change in value of the underlying derivative.
All of the forward contracts to buy US Dollars and some of those to sell Euros meet the conditions for hedge accounting, in accordance with the Group's accounting policies.
The fair value of forward contracts that are effective in offsetting the exchange rate risk is a liability of GBP197,000, which has been recognised in other comprehensive income and will be released to profit or loss at the end of the term of the forward contracts that expire within 12 months. The cash flows in respect of the forward contracts will occur over the course of the 12 months to 31 July 2017.
Derivative Financial Instruments - Interest Rate Swaps
The Group has entered into an interest rate swap to hedge the exposure to interest rate movements on the Group's revolving credit facility. The swap is based upon a principal amount of GBP2,000,000 until 31 July 2018 and exchanges the exposure to a LIBOR interest rate to a fixed rate of 0.39 %. The fair value of the swap at 31 July 2017 is GBPnil, (2016 - GBP7,000 liability).
In addition, the Group has entered into an interest rate swap to hedge the Group's exposure to interest rate movements on the Group's invoice discounting facility. The swap is based upon a principal amount of GBP1,000,000 until 31 December 2019 and exchanges the exposure to Base Rate interest charges to a fixed rate of 0.31 %. The fair value of the swap at 31 July 2017 is an asset of GBP4,000 (2016 - GBP6,000 liability).
Interest rate swaps are valued using level 2 inputs. The valuations are based upon the notional value of the swaps, the current available market borrowing rate and the swapped interest rate. The valuation is based upon the current valuation of the present saving or cost of the future cash flow differences, based upon the difference between the swapped interest rate and the expected interest rate as per the lending agreement.
All interest rate swaps meet the conditions for hedge accounting, in accordance with the Group's accounting policies.
The fair value of variable to fixed interest rate swaps that are effective in offsetting the variable interest rate risk on variable rate debt is an asset of GBP4,000, which has been recognised in other comprehensive income and will be released to profit or loss over the term of the swap agreements. The agreements expire between 31 July 2018 and 31 July 2019. The cash flows in respect of the swaps occur monthly over the effective lifetime of the swaps.
Derivative Financial Instruments - Interest Rate Caps
Along with the interest rate swaps referred to above, the Group has entered into interest rate cap agreements to protect the exposure to interest rate movements on the Group's banking facilities. The interest rate caps are measured at fair value, being the market value of the cap at the balance sheet date. At 31 July 2017, the Company had entered into an agreement to cap LIBOR interest rates at 1 % until 31 December 2019 on a principal amount of GBP2,000,000. The fair value of the interest rate cap at 31 July 2017 was an asset of GBP3,000 (2016 - GBP6,000 asset).
In addition, at 31 July 2017, the Group has entered into further agreements to cap LIBOR interest rates at 1 % until 31 December 2019 on a principal amount of GBP2,000,000 and to cap LIBOR interest rates at 2 % on a principal amount of GBP5,095,000, reducing to GBP3,080,000 by 31 December 2019. The fair value of the interest rate caps at 31 July 2017 was an asset of GBP10,000 (2016 - GBP13,000 asset).
Interest rate caps are valued using level 2 inputs. The valuations are based upon the notional value of the caps, the current available market borrowing rate and the capped interest rate. The valuation is based upon the current valuation of the present saving or cost of the future cash flow differences, based upon the difference between the capped interest rate and the expected interest rate as per the lending agreement.
The following is a reconciliation of the financial instruments to the statement of financial position:
31 July 2017 31 July 2016
GBP'000 GBP'000
-------------------------------------------------- ------------- -------------
Trade receivables 10,474 14,686
Forward currency contracts - 454
Interest rate caps 13 19
Interest rate swaps 4 -
Prepayments and other receivables not classified
as financial instruments 1,254 1,072
Trade and other receivables (note 13) 11,745 16,231
=================================================== ============= =============
31 July 2017 31 July 2016
GBP'000 GBP'000
------------------------------------------------- ------------- -------------
Trade and other payables 11,810 15,290
Forward currency contracts 200 37
Interest rate swaps - 13
Employee tax and social security not classified
as financial instruments 506 1,063
Trade and other payables (note 14) 12,516 16,403
================================================== ============= =============
17. Share Capital
The following movements arose in the Company's share capital during the year ended 31 July 2017:
a) 21,157 options in the UP Global Sourcing Holdings EMI Share Option Plan were exercised and the Company allotted 21,157 B Ordinary shares of GBP1 each;
b) The Company converted its 184,267 A ordinary shares of GBP1 each and its 21,157 B ordinary shares of GBP1 each to 205,424 GBP1 Ordinary shares; and
c) The Company subdivided its 205,424 GBP1 Ordinary shares into 82,169,600 shares with a nominal value of 0.25 p.
On conclusion of the above, the Company's share capital now comprises 82,169,600 Ordinary shares of 0.25 p each.
18. Events occurring after the reporting period
Final Dividend Proposed
As disclosed in note 11 above, the Directors have proposed a final dividend of 3.495 p per share in respect of the year ended 31 July 2017. The dividend is due to be payable on 30 January 2018 to shareholders on record at 5 January 2018.
19. Related Party Transactions
Transactions and Balances with Related Companies and Businesses
Year Year
ended ended
31 July 31
2017 July
2016
GBP'000 GBP'000
-------------------------------- --------- --------
Transactions with related
companies:
Rent paid to Ultimate
Apartments Pension Scheme 163 160
Rent paid to Heron Mill
Limited 241 75
Rent paid to Berbar Properties 17 -
Limited
================================== ========= ========
There were no outstanding balances with the above related parties at either year end.
Annual General Meeting
The Company's Annual General Meeting will be held at 2.00pm on 15 December 2017 at the Company's registered office, Manor Mill, Victoria Street, Oldham OL9 0DD.
Glossary
The following definitions apply throughout this announcement unless the context requires otherwise:
'Board' the board of Directors;
'Company' or 'Ultimate UP Global Sourcing Holdings
Products' plc, a company incorporated
in England and Wales with registered
number 05432142;
'CY 18' the calendar year 2018;
'Directors' the Executive and Non-Executive
Directors;
'EBITDA' Earnings before interest, tax,
depreciation and amortisation;
'EMI Scheme' the Enterprise Management Incentive
approved employee share scheme
under which share options were
granted in 2014;
'FCA' or 'Financial the UK Financial Conduct Authority;
Conduct Authority'
'Free Cash Flow' net cash from operations less
net capital expenditure (after
deducting disposal proceeds)
and less interest paid in the
year;
'Free on Board'or the free on board contractual
'FOB' arrangements pursuant to which
goods are handed over to the
Group's customers in the country
of origin and are then imported
into the UK and other territories
by those same customers;
'FY 16' the financial year for the Group
for the 12 months ended 31 July
2016;
'FY 17' the financial year for the Group
for the 12 months ended 31 July
2017;
'FY 18' the financial year for the Group
for the 12 months ended 31 July
2018;
'FY 19" the financial year for the Group
for the 12 months ended 31 July
2019;
'Group' the Company and its Subsidiaries
from time to time;
'Independent Non-Executive independent Non-Executive Directors
Directors' of the Company, within the meaning
of the UK Corporate Governance
Code, being James McCarthy,
Robbie Bell and Alan Rigby;
'IPO' or 'Initial the Group's admission to the
Public Offering' premium segment of the Official
List of the Financial Conduct
Authority and to trading on
the Main Market of the London
Stock Exchange plc on 6 March
2017;
'Landed' the Landed duty paid arrangements
pursuant to which the Group
imports goods into the UK;
'Net Debt' total borrowings excluding unamortised
debt issue costs and less cash
balances at the end of the financial
year;
'Net Debt/Underlying Net Debt at the end of the financial
EBITDA Ratio' year divided by Underlying EBITDA
for the same period;
'Non-Executive James McCarthy, Barry Franks,
Directors' Robbie Bell and Alan Rigby;
'Official List' the Official List of the UK
Listing Authority;
'Shareholder Bonuses' the bonus arrangements agreed
by the Company on 11 June 2014
relating to Simon Showman and
Andrew Gossage for the periods
up to and including FY 17, ending
thereafter;
'Sterling'or 'GBP' the lawful currency of the UK;
or 'GBP'
'Subsidiary' has the meaning given to it
in section 1159 of the Companies
Act and includes group companies
included in the consolidated
Financial Statements of the
Group from time to time;
'Underlying Earnings Earnings Per Share after adding
Per Share' back the effect after tax of
the exceptional items and share
based payment charges;
'Underlying EBITDA' EBITDA after adding back the
exceptional items and share
based payment charges;
'Underlying EBITDA Underlying EBITDA divided by
Margin' revenue for the same period,
expressed as a percentage;
'Underlying Profit profit before taxation after
Before Tax' adding back the exceptional
items and share based payment
charges;
'Underlying Profit profit for the year after adding
for the Year' back the after tax effect for
the exceptional items and share
based payment charges;
'United Kingdom' the United Kingdom of Great
or 'UK' Britain and Northern Ireland;
'US$' or 'USD' the lawful currency of the United
or 'US dollar' States of America;
The Reconciliation of Underlying Performance Measures is set out in the table below.
Reconciliation of Underlying Performance Measures
Year ended Year ended
31 July 2017 31 July 2016
GBP'000 GBP'000
Profit from operations 7,891 6,700
Depreciation 394 280
Gain on disposal (5) -
EBITDA 8,280 6,980
Exceptional items and share based payment charges 3,232 1,246
Underlying EBITDA 11,512 8,226
========================================================== ============== ==============
Profit before taxation 7,427 6,259
Exceptional items and share based payment charges 3,232 1,246
Underlying profit before tax 10,659 7,505
========================================================== ============== ==============
Profit for the year 5,575 4,898
Exceptional items and share based payment charges 3,232 1,246
Tax on exceptional items and share based payment charges (401) (249)
Underlying profit for the year 8,406 5,895
========================================================== ============== ==============
Underlying profit for the year 8,406 5,895
No of shares 77,254,220 73,863,084
Underlying earnings per share 10.9 p 8.0 p
========================================================== ============== ==============
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UNUVRBOAARAA
(END) Dow Jones Newswires
November 07, 2017 02:00 ET (07:00 GMT)
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