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Share Name Share Symbol Market Type Share ISIN Share Description
Xpediator Plc LSE:XPD London Ordinary Share GB00BF6P5V92 ORD 5P
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Xpediator PLC Final Results

12/04/2021 7:00am

UK Regulatory (RNS & others)


Xpediator (LSE:XPD)
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TIDMXPD

RNS Number : 0552V

Xpediator PLC

12 April 2021

The information contained within this announcement is deemed by the Group to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). Upon the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.

12 April 2021

XPEDIATOR PLC

("Xpediator", the "Company" or the "Group")

FINAL RESULTS

Xpediator Plc (AIM: XPD), a leading provider of freight management services across the UK and Central and Eastern Europe, is pleased to announce its final results for the twelve months ended 31 December 2020.

2020 Financial Highlights

-- Generated Group turnover of GBP221.2m (2019: GBP213.2m) an increase of 3.7% reflecting a generally resilient performance during the Covid-19 impacted months coupled with a strong performance in the last quarter of 2020

-- Delivered a 38.5% increase in adjusted profit before tax of GBP7.2m (2019: GBP5.2m) helped by early cost reductions in March 2020, alongside some core markets benefiting from Covid-19 related changes and with areas of weakness (e.g. high street retail and transport services) being offset by the diversity of businesses across multiple markets

-- Reported profit before tax of GBP3.9m (2019: GBP2.2m)Adjusted basic earnings per share of 3.84 pence (2019: 2.80 pence)

   --    Basic earnings per share of 1.46 pence (2019 : 0.60 pence) 

-- Strong cash generation and working capital management continues with net cash stable at GBP6.8 m despite paying GBP4.4m (2019: GBP0.2m) in deferred acquisition payments

   --    Dividend per share increased by 12.8% to 1.50 pence (2019: 1.33 pence) 

2020 Operational Highlights

-- Appointment of Robert Ross as new CEO in October 2020, previously Group CFO and in March 2021 appointment of Mike Williamson as new CFO

-- Reaffirmed core strategic outlook coupled with new CEO vision for how to achieve commercial objectives

-- Recorded strong growth in the Freight Forwarding Division supported by resilient and profitable performances by both the Transport and Warehouse & Logistics divisions both of which were held back by the pandemic:

o Freight Forwarding delivered revenue of GBP171.0m, an increase of 7.1%

o Warehouse & Logistics delivered revenue of GBP44.5m, a decrease of 6.3%

o Transport Services delivered revenue of GBP5.7m, a decrease of 6.9%

   --    On 5 October 2020 completed the successful acquisition of Nidd Transport Ltd 
   --    Disposal of loss making B2C business EshopWedrop 

2021 Outlook

   --    First quarter trading results are positive and ahead of management expectations 

-- Consolidation and improved overall financing terms of UK banking facilities with a new GBP18m finance facility with Investec Bank Plc replacing the existing GBP9.5m facility

-- Managing transportation post Brexit more complex than anticipated with customers requiring additional support which is net profitable for the Group

-- First full year of benefit from GBP0.5m of annualised cost savings made as part of the response to the pandemic

   --    Healthy pipeline of potential acquisitions 

Alex Borrelli, Chairman, commented:

"We are naturally very pleased to have delivered this performance during such a challenging year. Increasing both revenues and profitability is an excellent achievement and we think confirms the strength of the platform the Group has. Added to this, we now have a new senior management team led by CEO Robert Ross whilst retaining the expertise and knowledge of Stephen Blyth, the founder of the business, on the Board.

Our aim to become a leading international freight management and logistics provider, is unchanged. We continue to examine strategic acquisitions with a focus on building a scalable and risk adjusted platform to support an expanding portfolio of freight management companies across the UK and Europe with a particular expertise on Central and Eastern Europe. 2021 has begun well and we are quietly confident of our ability to achieve our objectives."

For all investors Robert Ross (CEO) and Mike Williamson (CFO) will be giving a presentation on the FY results today at 10.30am via Investor Meet Company, to register please click on the following link: https://www.investormeetcompany.com/xpediator-plc/register-investor

Enquiries

 
 Xpediator plc                                         Tel: +44 (0)330 043 
                                                        2395 
 Robert Ross, Chief Executive Officer                  Email: info@xpediator.com 
 Michael Williamson, Chief Financial Officer 
 
 Cenkos Securities plc (Nominated Advisor &            Tel: +44 (0)20 7397 
  Broker)                                               8900 
 Max Hartley, Max Gould (Corporate Finance) 
 Nick Searle (Sales) 
 
 Novella Communications (Financial Public Relations)   Tel: +44 (0)20 3151 
                                                        7008 
 Tim Robertson 
 Fergus Young 
 

About Xpediator:

Xpediator is a well-established international provider of freight management services. Established in 1988 by the current Deputy Chairman Stephen Blyth today the Group's International network of offices provides road, sea and air freight services, together with logistics and warehousing in the UK and Romania. The business offers integrated freight management within the supply chain logistics and fulfilment sector, through their three main areas: freight forwarding, logistics & warehousing and transport solutions. With headquarters in Braintree, Essex and country offices in nine CEE countries across 31 sites, the Group currently employs over 1,000 people and was successfully listed on London's AIM market in August 2017.

For more information, please visit: www.xpediator.com .

   Alternatively, do follow us on Twitter at  @Xpediator   or find us on LinkedIn at  Xpediator Plc . 

CHAIRMAN'S STATEMENT

INTRODUCTION

I am delighted to present these accounts which show strong performance and demand for our services despite the impact of Covid-19 during the year.

With revenues increasing to GBP221.2 million, which is up by 3.7% on the prior year, we delivered adjusted profit before tax substantially ahead of last year at GBP7.2 million, up by 38.5%. The Group's asset light business model proved to be very resilient during 2020 and there are strong signs of further growth being delivered in 2021. Strategically, Xpediator remains focused on establishing its network of freight management companies across the UK and Europe with a particular expertise in the fast growing Central and Eastern European ("CEE") regions. Recognising the market opportunity, the Group is seeking to exploit the growth across the CEE regions. In terms of Brexit, following the United Kingdom's exit from the European Union, the demands for custom clearance services have increased, and the Group expects additional revenue streams from this, with further profit generation as volumes increase. Importantly, the Company continues to have a good pipeline of acquisition opportunities which meet the criteria of enhancing the Group's geographical capabilities, developing our existing operational locations and extending the Group's international presence in air and sea transportation. Overall, the Group is in a strong position.

Our people

The Group recognises that our people are our greatest asset. During the year, the first Group wide employee engagement survey was launched. As a result of this survey, several focus groups were initiated to discuss the results of the survey and formulate an action plan to promote the wellbeing of our employees and the work environments in which we operate.

During 2021, the Group has launched Group wide values and held its first Senior Leadership Conference to set out the strategic priorities of the Board. We also plan to review the benefits of all of our people to ensure that Xpediator is seen as an employer of choice. In February 2021, the Group launched a Company Share Option Plan for senior employees.

Board and management changes

On 2 January 2020, the Company confirmed the appointment of Robert Rossas Chief Financial Officer ("CFO"). Robert previously held the position of Finance Director at Europa Worldwide Group. On 5 June 2020, the Group announced that Stephen Blyth would retire from the role of Chief Executive Officer ("CEO") moving to a non-executive position as Founder and Deputy Chairman. Stephen has also taken up the position of Chairman of the newly formed Mergers and Acquisitions committee. After an extensive process with both internal and external candidates, Robert was subsequently appointed CEO on 2 October 2020. On 19 January 2021, the Group announced Michael Williamson as the new CFO from 1 March 2021. He joined from international freight forwarding company Rohlig Logistics where he was the Global Director of Finance & Controlling and Regional CFO of Northern Europe. The Board would like to express its thanks to Stephen for his service to the Group over the last 32 years, and for extending the period for which he was CEO, following the changes announced in September 2019.

Dividend

Subject to approval by shareholders, the Board is recommending a final dividend of 1.05p per share to be paid to shareholders in June 2021. Taken with the interim dividend of 0.45p per share, this takes the full year dividend to 1.50p per share, a 12.8% increase on the prior year (2019:1.33p). The final dividend for 2019 was a scrip issue. The final dividend will be payable to shareholders on the register in June 2021, with the ex-dividend date being in July 2021.

Outlook

The Group is well positioned for further growth in 2021, with the first quarter results slightly ahead of the Board's expectations, despite the on-going Covid-19 restrictions. The Board continues to examine strategic acquisitions, whilst completing the integration of those made previously. With the hopeful easing of Covid-19 restrictions across Europe, opportunities arising from Brexit and building on the success of 2020, the Board is confident of delivering results in line with market expectations for 2021. Having joined the Company in 2016 and overseeing the continued growth of Group revenues, profitability and shareholder value, with a strong management team now in place and in recognition of corporate governance guidelines and best practice regarding tenure, I will be standing down subsequent to the Group's 2021 Annual General Meeting, once my successor has been identified.

Alex Borrelli

Non-Executive Chairman

CHIEF EXECUTIVE OFFICER'S STATEMENT

INTRODUCTION

In my first financial year, initially as Chief Financial Officer, and then as Chief Executive Officer from October, we have overcome many significant challenges and I am grateful to all our staff for their commitment, determination and resilience.

Whilst Covid-19 continues to challenge us and market conditions remain competitive, we are focused on delivering exceptional customer service. Demand for our freight management services, logistics and transport solutions and services remains high and following a strong 2020 final quarter, we delivered an adjusted profit before tax of GBP7.2 million. Demand for freight management in the UK and CEE countries was extremely buoyant during the year. Whilst volumes reduced during March and April 2020 because of a number of stay-at-home policies throughout Europe, Covid-19 has led to changes in consumer trends that have driven economic growth within our core markets.

The CEE region, in particular, saw increased demand, with 62% (2019: 58%) of the Group's revenue now being generated in mainland Europe. The financial results achieved in 2020 are testament to the hard work of our people and in our core markets our experience and infrastructure enabled us to win contracts against the largest competitors. Whilst growth in the UK was more subdued during 2020, mainly due to the impact of Covid-19, we are confident that higher growth rates will return during 2021.

Cash generation in the Group remains strong. Net cash (excluding right-of-use assets) remained at similar levels to the prior year despite the Group settling GBP4.4m (2019: GBP0.2m) of deferred consideration on Import Services Limited (GBP3.0m), Anglia Forwarding Group Limited (GBP1.1m) and Regional Express Limited (GBP0.3m). During 2020, the Group identified GBP0.5million of annualised savings which will feed through to an improvement in operating profit, as well as maintaining strong cash generation.

Acquisitions and disposals

We remain focused on making strategic acquisitions (both in the UK and in Central and Eastern Europe) and to act as a consolidator of the highly fragmented freight management market. In the last three years the Group has completed four transactions which have added over 1,200 new customers together with significantly expanding the Group's air and sea freight capabilities.

On 1 January 2020, the Group obtained operational and management control of International Cargo Centre Limited ("ICC"). This has been accounted for as a business combination on 1 January 2020 under the definition of IFRS 3 "Business Combinations". On 30 April 2020, the Group acquired the remaining 60% of the issued share capital of ICC, having acquired the original 40% on 4 June 2018. On 5 October 2020, the Group acquired the entire share capital of Nidd Transport Limited, a Company that specialises in daily express deliveries to mainland Western Europe and UK distribution, particularly in the North of England. This has also been accounted for as a business combination under the definition of IFRS 3 "Business Combinations". On 31 December 2020, the Group disposed of the EshopWedrop business. This loss-making part of the Group was considered non-core and was sold to the Managing Director, Mircea Bandean. The integration of the acquisitions made during 2017 and 2018 continues with statutory and IT simplification programmes due to be completed by the end of the first half of 2021. The newly formed Mergers and Acquisitions Committee, chaired by Stephen Blyth, will be focused on delivering continued profitable expansion of the Group.

COVID-19

Covid-19 has impacted our business in many ways. Throughout the pandemic our primary focus has been on the well-being and safety of our people, customers and suppliers. The Group has traded strongly through this extraordinary period and whilst activities are broadly similar to prior years, the freight forwarding division has been strong throughout. Those areas which are dependent on either traffic volumes (Affinity) or exposed to market conditions with Government restrictions, such as Easy Managed Transport Limited ("EMT")(UK High Street Fashion) or Benfleet Forwarding Limited (with China and Italy being key markets) experienced reduced trading levels in the earlier part of the year. Whilst conditions for fashion retailers in the UK High Street and therefore EMT, remain tough, all other parts of the Group are back to trading ahead of or broadly in-line with pre-pandemic levels. During the pandemic, the Group identified some good developmental opportunities, whilst challenging and flexing the cost base to meet the demand. In March 2020, the Group took the decision to introduce temporary pay reductions, to reduce costs in areas of reduced activity and suspend certain capital investment projections as the full extent of the pandemic was initially unknown. By August 2020, the Group had reinstated salaries back to their normal levels and any salary reductions have been repaid in full.

BREXIT

Over the last three years, we have allocated resource to be part of a specific BREXIT team. These people have been working closely with customers to ensure a smooth transition and clarity on the new ways of working. Following the announcement of the free trade agreement on 24th December 2020, we have seen a considerable change in the requirements for moving goods between the UK and mainland Europe. These requirements are considerably more complex than initially anticipated. We continue to work closely with our customers to ensure that the correct paperwork is completed, and our services continue.

With the additional paperwork, we have had to allocate and recruit additional people to manage the workload. However, offsetting this additional cost is additional revenue from our customers. We see there being a net benefit to the profitability of the Group from this additional work although we recognise the uncertainty BREXIT may bring.

OUR VISION AND STRATEGY

Xpediator is a leading Freight Management provider in a very fragmented and competitive logistics market.

Our vision as a Group remains unchanged in that over the next five years we want to maintain the rate of growth achieved over the last five years and become a leading international freight management and logistics provider.

Our strategy remains focussed around building a scalable and risk adjusted platform to support an expanding portfolio of freight management companies across the UK and Europe with a particular expertise on CEE.

As we moved into 2021, I challenged all our senior leaders at our inaugural Senior Leadership Conference to focus on three items. Firstly, to simplify their business units by streamlining processes, investing in IT and driving out complexity. Secondly to invest in the growth of our staff so everyone is doing the job they should be doing rather than the job they want to be doing. And finally, to be the best that we can be by working together, encouraging commitment over compliance and living by our new Group values.

As a Group we want to deliver sustainable solutions to our clients who are at the centre of our service offerings. We focus on offering our clients the optimal solution for their transport and logistics needs with consistently high quality and competitive services.

We also look to ensure our client base is diverse, not just in terms of the number of clients, but also the sectors we service. No single client contributes more than 2% of Group revenue. As an acquisitive business, one of the areas of focus when considering acquisition opportunities, is how the opportunity can add to this diversity. Accordingly, strategically selected acquisitions have added to our ability to be able to offer more services to our existing client base as well as attracting new clients. We are now able to offer even stronger industry-specific solutions for our clients in the retail and fashion, toys and games sector.

We are developing our port centric warehousing and logistics in the UK with the expansion of our Logistics facilities in Southampton where we will open a new 20,000 sqm facility at the end H1 2021.

We continue to focus on targeted, earnings enhancing acquisitions. Operating in a large, fragmented market means there are numerous acquisition targets and our strategy is to focus on global freight forwarders and contract logistics providers which are supported by a strong client base with a strong earnings track record.

As we operate in a low margin industry, we strive to identify ways in which we can continue to provide high quality services to our clients in a cost-effective way. The senior leadership team within the Group is now complete following the recruitment of an Estates Director to manage our property portfolio. As the revenue of the Group grows and we continue to focus on driving out complexity, operational leverage of this senior team will enhance our net profit margin. In addition, we continue to enhance our online functionality that allows us to offer our clients a seamless solution to make bookings and track their consignments. The digitalisation of these processes will be margin enhancing as we take out overhead costs, whilst ensuring our clients have a competitive and robust solution. Ultimately, at the heart of the Group's vision is client service, delivered through optimal solutions, whilst being competitively priced and delivering consistently high levels of customer service.

Outlook

We are currently operating in an extraordinary period, and some of the impacts of Covid-19 may be with us for some time. I am proud of the way everyone across the Group has responded to the crisis. The resilience shown by our people and the willingness to pull together to get through this period has been humbling. We have a strong business that has delivered a fantastic set of results. 2021 has started well and our focuses for the year are on delivering further growth from investment in our sales function, efficiencies in our operations from continued digitalisation and working more closely together as a Group. I would like to thank everyone for their efforts through this extremely challenging year. We will continue with our vision and drive our strategic objectives thus ensuring we provide greater job security and rewards for our employees, and most importantly, enhancing returns for investors.

Robert Ross

Chief Executive Officer

Divisional Review

FREIGHT FORWARDING

REVENUE

GBP171.0m (2019: GBP159.6m)

SEGMENT PROFIT BEFORE CENTRAL OVERHEAD ALLOCATION

GBP6.8m (2019: GBP3.4m)

Freight forwarding services, largely provided under the Delamode brand, specialising in connecting our local offices in CEE countries and the UK with each other and rest of Europe. In 2020, freight forwarding revenues increased by GBP11.4 million, of which GBP8.9 million related to organic growth and GBP2.5 million related to the acquisitions of Nidd Transport Limited and International Cargo Centre Limited.

Revenues across the Baltics and Balkans continued to grow significantly against prior year comparatives, with Delamode Baltics revenue up by GBP8.9 million and Delamode Bulgaria up by GBP3.8 million. Both businesses have benefitted from an increase in online customer demand and the consolidation of new service lines. Profit before tax in Lithuania increased by GBP2.2 million to GBP4.1 million (2019 - GBP1.9million) and in Bulgaria by GBP0.3million to GBP1.1m (2019 - GBP0.8 million). In addition, both Serbia and Estonia delivered a strong performance as these businesses matured.

Like for like revenue in the UK decreased by GBP6.0 million mainly due to Covid-19 impacting trading volumes, particularly Chinese and Italian related business, however, by the end of 2020, revenues were broadly in line with prior years. Despite revenue being lower, operating profits in the UK were stable following a review of the cost base which was flexed in line with demand.

Regional Express Limited won a major contract that commenced operations in August 2019. Whilst the initial implementation was slow, H2 2020 showed strong growth and trading in 2021 is slightly ahead of management's expectations.

During 2020, our e-commerce business EshopWedrop was sold and our other e-commerce business Buzzbrand was discontinued. EshopWedrop was sold on 31 December 2020 to Mircea Bandean, who was Managing Director of the business. The loss of GBP0.3 million (2019: loss of GBP0.5 million) is shown in exceptional costs for 2020.

Divisional Review

WAREHOUSING & LOGISTICS

REVENUE

GBP44.5m

(2019: GBP47.5m)

SEGMENT PROFIT BEFORE CENTRAL OVERHEAD ALLOCATION

GBP2.6m

(2019: GBP2.9m)

The Logistics division's activities remain focused in Romania and the UK with revenue broadly in line with the prior year.

The Group's Pall-Ex franchise in Romania continues to perform strongly, offering a palletised freight delivery service to any part of the country within 24 hours and handling in excess of 68,000 pallets on average per month in 2020 (2019: 60,000 average pallets per month).

There is a strong pipeline of demand for warehouse space in Romania and having the ability to deliver palletised freight throughout Romania overnight, puts the Pall-Ex business in an enviable position for further growth in the future.

In the UK, the lease for a new purpose built facility in the Port of Southampton has been signed and practical completion is expected to occur in June 2021. The Group has also committed to building a mezzanine level at the facility, which will add a combined 290,000 sq ft of warehousing and will become operational for the peak Q4 period of 2021.

Import Services Limited benefitted from higher volumes in Q4 amongst its customers in the toy sector as it fulfilled a number of internet orders as UK customers stepped away from the High Street following a significant increase in Covid-19 cases.

The warehouse in Braintree experienced some further challenges during 2020, with the loss of a significant client and the substantial expansion of an existing retail customer. During the changeover, management took the opportunity to reconfigure the warehouse which will drive greater future opportunities and allow the Group to increase its e-fulfilment for new and existing customers. There are several potential new clients for the Braintree warehouse, and we look forward to a more successful 2021.

The Beckton warehouse has had a challenging year, with a decline in profit of GBP0.5 million. The Beckton warehouse is exposed to the UK High Street retail fashion sector, which was one of the industries most impacted by Covid-19. Trading in this business area is likely to remain challenging until Covid-19 restrictions are lifted.

Divisional Review

TRANSPORT SERVICES

REVENUE

GBP5.7m

(2019: GBP6.2m)

GROSS BILLINGS

GBP126.4m

(2019: GBP142.3m)

SEGMENT PROFIT BEFORE CENTRAL OVERHEAD ALLOCATION

GBP2.3m

(2019: GBP2.5m)

Transport solutions, trading principally under the Affinity brand, provides bundled fuel and toll cards, financial and support services for hauliers in southern Europe. Affinity has been an agent of DKV in Romania since 2002, one of the world's largest fuel card providers and provides the DKV fuel card across the Balkans to a database of approximately 2,000 Eastern European hauliers and over 15,000 trucks.

In addition, Affinity provides a "one stop shop" of transport services including roadside assistance and ferry bookings. Affinity's commercial model fits well within the Group as many of the hauliers who are customers of Affinity also supply haulage services to Delamode a key factor that enables the Group to have a good understanding of its customers and suppliers, which underpins the strategy to provide further financial services such as insurance and leasing. With current driver shortages in Europe, having a supplier base will also become increasingly important for the forwarding division.

Volumes sold to customers (gross billings) decreased in 2020 by 11.2% because of fewer journeys made in Europe due to the Covid-19 pandemic and lower average fuel prices of 13.9%.

Romania remains the largest region for the division representing 72% of total activity, (2019: 84.0%, 2018: 87.2%). The Balkans operation continues to grow leveraging the relationships with the freight forwarding businesses based in Bulgaria and Serbia.

There are several opportunities where Affinity is looking to capitalise on in 2021, including developing the leasing and insurance products tailored specifically for Affinity's existing customer base.

The division's 19 years of experience provides a good platform to expand in new geographical regions, as well as being well placed to further develop its service and product offerings.

CHIEF FINANCIAL OFFICER'S STATEMENT

Mike Williamson

Chief Finance Officer

FINANCIAL REVIEW

Revenue

Group revenue increased in 2020 by GBP8.0 million (3.7%) to GBP221.2 million with like for like growth

of GBP5.5 million and the acquisition of Nidd Transport Limited contributing turnover of GBP2.5 million

since 5 October 2020.

The Freight Forwarding division delivered GBP171.0 million (7.2% increase v 2019), the Warehousing

and Logistics division revenue of GBP44.5 million (6.3% decrease v 2019) and the Transport

Services division delivered GBP5.7 million (6.9% decrease v 2019).

Segment Profit before Central Overhead Allocation

Segment profit before central overhead allocation and exceptional items increased by 42.6% (GBP2.0 million) year on year largely driven by increased activity in the freight forwarding division and the sale of the EshopWedrop business, which was loss making and historically reported in the freight forwarding division.

Operating profit in the warehouse and logistics division decreased by GBP0.3m to GBP2.6m mainly due

to the reduction in volumes in the UK warehouse business, particularly around those areas exposed

to the UK high street and fashion businesses.

The Transport Services division's operating profit decreased by GBP0.2m to GBP2.3m due to a reduction

in the level of trucks moving across European countries and a reduction in diesel prices.

Group Profit before Taxation

Group profit before tax increased in 2020 to GBP3.9 million (2019 GBP2.2 million) driven by the freight

forwarding department which more than offset slight reductions in the other two divisions. A

summary of operating profit before central overhead allocation by division is shown below:

 
                            2020      2019      2018      2017 
 Freight Forwarding        GBP6.8m   GBP3.4m   GBP3.0m   GBP2.4m 
 Warehouse and Logistics   GBP2.6m   GBP2.9m   GBP3.0m   GBP0.9m 
 Transport Services        GBP2.3m   GBP2.5m   GBP2.3m   GBP2.0m 
 

Adjusted profit before tax

 
                                                 2020      2019      2018      2017 
 Profit Before Tax                              GBP3.9m   GBP2.2m   GBP5.6m   GBP2.4m 
 Exceptional Items (note 27)                    GBP1.4m   GBP0.9m   GBP0.3m   GBP0.9m 
 Net unwind and addback of 
  discount on deferred consideration/Benfleet 
  Vendor Income                                 GBP0.1m   GBP0.3m   GBP0.2m   GBP0.3m 
 Amortisation of intangibles 
  (note 12)                                     GBP1.5m   GBP1.4m   GBP1.1m   GBP0.4m 
 Net Income Statement Impact 
  of application of IFRS 16                     GBP0.3    GBP0.3m      -         - 
 Adjusted Profit before tax                     GBP7.2m   GBP5.1m   GBP7.2m   GBP4.0m 
---------------------------------------------  --------  --------  --------  -------- 
 

Earnings per Share

 
                                   2020      2019   2018   2017 
 Basic Earnings Per Share             1.66   0.60   3.53   1.64 
 Adjusted Earnings Per Share          3.84   2.80   4.80   3.27 
 

The total number of ordinary shares at 31 December 2020 was 141.6 million (2019: GBP136.1 million) The increase reflects the issue of 5.5 million shares in June 2020 for the scrip dividend. Profit after tax attributable to the owners of the parent company of GBP2.0 million (2019 : GBP0.8m) provides a basic earnings per share of 1.46p (2019 - 0.60p), an increase of 143.3% (2019 : 82.5% decrease) on 2019. Adjusted profit before tax results in a basic & diluted earnings per share of 3.84p (2019: basic 2.80p, diluted 2.79p) an increase of 37.1% (37.6% diluted) on 2019. (See note 10 of the financial statements).

Financial Resources

Asset Cover

 
 Financial Resources 
 Asset Cover                 2020        2019       2018       2017 
 Total Assets           GBP138.2m   GBP128.9m   GBP98.8m   GBP76.4m 
 Net Assets              GBP31.2m    GBP29.0m   GBP29.1m   GBP14.8m 
 Current Ratio               1.05        1.01       1.14       1.07 
---------------------  ----------  ----------  ---------  --------- 
 

Cash

The Group continues to focus on the application of tight cash controls and the need to maintain a reasonable headroom for future contingencies and to manage financing risk. The Board regularly monitors the financing needs of the business through cash flow projections for the following 12 months. These are expected to be achieved for the coming year from existing cash balances, loan facilities and operating cash flows. The Group has sufficient financial resources and a broad spread of business activities. The Directors therefore believe that it is well placed to manage its business risks.

 
 Cash                                      2020        2019    2018 (1)    2017 (1) 
 Net cash from operating activities    GBP14.1m    GBP14.2m     GBP8.5m     GBP3.9m 
 Net cash outflow from investing      GBP(6.0)m   GBP(2.0)m   GBP(7.0)m   GBP(6.5)m 
  activities 
 Net cash outflow from financing      GBP(7.8)m   GBP(9.3)m   GBP(0.4)m     GBP4.8m 
  activities 
 Effect of foreign exchange             GBP0.4m   GBP(0.5)m     GBP0.2m   GBP(0.1)m 
  movements 
-----------------------------------  ----------  ----------  ----------  ---------- 
 Cash and cash equivalents             GBP12.7m    GBP12.0m     GBP9.6m     GBP7.3m 
  at end of year 
-----------------------------------  ----------  ----------  ----------  ---------- 
 

(1) Comparatives for 2017 and 2018 have been restated for consistency with the reporting under IFRS 16. Previously, the cashflow for operating leases was reported within net cash from operating activities (2018, GBP5.9m, 2017 - GBP2.2m), but are now reported in net cash outflow from financing activities.

Cash generated improved by GBP0.7m. However, short term loans increased by GBP1.4m, with the Group having paid GBP4.4m of deferred consideration on Import Services Limited, Anglia Forwarding Group Limited and Regional Express Limited acquisitions.

Working Capital

 
 Trade Receivables and Payables         2020       2019       2018       2017 
 Trade and other receivables        GBP66.7m   GBP60.9m   GBP60.3m   GBP51.8m 
 Trade and other payables           GBP64.8m   GBP58.6m   GBP56.1m   GBP51.0m 
 Days Sales Outstanding (based 
  on gross billings)                    71.2       63.5       70.4       81.5 
 Days Payable Outstanding (based 
  on cost of sales)                     82.5       71.9       75.6       91.3 
 

Trade receivables and payables increased at the year-end as did days sales outstanding and days payable outstanding. Revenue in November 2020 was 10.8% up on the prior year, whilst revenues in December were 31.6% ahead of the prior year. The increased demand was fuelled by more online shopping following the closure of non-essential retail in a number of major European countries, and increased volumes relating to BREXIT to ensure supply into post the UK transition deadline with the free trade discussions between the UK and the EU only being concluded in the week of Christmas 2020. Whilst days sales outstanding have increased by 8 days (or 12.1%), this has been more than offset by days payable outstanding increasing by 11 days (or 14.7%).

Administrative Costs Review

Average staff numbers have increased from 1,037 in 2019 to 1,080 in 2020. This is largely due to the acquisitions of Nidd Transport Limited and International Cargo Centre Limited.

 
 Operating Costs (Key Items)            2020       2019       2018       2017 
 Staff Costs                        GBP24.6m   GBP23.9m   GBP18.6m   GBP13.4m 
 Bad debts                           GBP0.8m    GBP0.8m    GBP1.1m    GBP0.6m 
 Depreciation on right-of-use 
  assets/rental payable 
  under leases                       GBP6.9m    GBP6.0m    GBP5.9m    GBP2.3m 
 Insurance                           GBP1.1m    GBP0.9m    GBP0.7m    GBP0.3m 
 Plant and machinery hire            GBP0.6m    GBP0.7m    GBP0.7m    GBP0.3m 
 IT costs                            GBP2.1m    GBP1.6m    GBP0.6m    GBP0.3m 
 Other administration               GBP15.2m   GBP16.1m    GBP8.8m    GBP8.4m 
 

Finance Costs

Excluding the IFRS 16 impact of GBP1.0 million, finance costs were GBP0.4m compared to GBP0.6m in the prior year. This is largely as a result of a reduction in the non-cash interest on the deferred consideration payable for the acquisitions made by the Group.

Impairment

The Group carries out its impairment tests annually in November as part of the budget process and all newly acquired entities are also reviewed for impairment at the balance sheet date.

No impairment losses have been recognised during the year.

Financing Facilities

The Group has agreed a new GBP18 million banking facility with Investec Bank plc in the UK. This consolidates the Group's banking facility which had become fragmented as a result of recent acquisitions. The Group benefits from an increased availability in the confidential invoicing discount facility as well an overall improvement of the financing terms.

The Group continues to review is European facilities to support the Group's CEE operations.

FINANCIAL STATEMENTS

CONSOLIDATED INCOME STATEMENT

FOR THE YEARED 31 DECEMBER 2020

 
                                                                                            2020       2019 
                                                                                Notes    GBP'000    GBP'000 
------------------------------------------------------------------------------  -----  ---------  --------- 
Gross billing                                                                       7    342,981    350,121 
------------------------------------------------------------------------------  -----  ---------  --------- 
CONTINUING OPERATIONS 
Revenue                                                                             3    221,226    213,247 
Cost of sales                                                                          (165,640)  (160,643) 
GROSS PROFIT                                                                              55,586     52,604 
Other operating income                                                              4      1,250      1,193 
Impairment losses on receivables                                                    5      (853)      (836) 
Administrative expenses                                                             5   (50,680)   (49,133) 
------------------------------------------------------------------------------  -----  ---------  --------- 
Exceptional items included in administrative expenses above                        27    (1,377)      (856) 
OPERATING PROFIT BEFORE EXCEPTIONAL ITEMS                                                  6,680      4,684 
------------------------------------------------------------------------------  -----  ---------  --------- 
OPERATING PROFIT                                                                    5      5,303      3,828 
Share of loss of equity accounted associate                                        16          -       (60) 
Finance costs                                                                       8    (1,464)    (1,674) 
Finance income                                                                      8         95         81 
------------------------------------------------------------------------------  -----  ---------  --------- 
PROFIT BEFORE INCOME TAX                                                                   3,934      2,175 
Income tax                                                                          9      (874)      (872) 
------------------------------------------------------------------------------  -----  ---------  --------- 
PROFIT FOR THE YEAR                                                                        3,060      1,303 
------------------------------------------------------------------------------  -----  ---------  --------- 
Profit attributable to: 
Owners of the parent                                                                       2,031        810 
Non-controlling interests                                                                  1,029        493 
------------------------------------------------------------------------------  -----  ---------  --------- 
                                                                                           3,060      1,303 
------------------------------------------------------------------------------  -----  ---------  --------- 
Earnings per share attributable to the ordinary equity holders of the parent: 
Basic earnings pence per share                                                     10       1.46       0.60 
Diluted earnings pence per share                                                   10       1.46       0.60 
Adjusted basic earnings pence per share                                            10       3.84       2.80 
Adjusted diluted basic earnings pence per share                                    10       3.84       2.79 
 

The notes form part of these financial statements

CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME

FOR THE YEARED 31 DECEMBER 2020

 
                                                               2020     2019 
                                                            GBP'000  GBP'000 
----------------------------------------------------------  -------  ------- 
PROFIT FOR THE YEAR                                           3,060    1,303 
OTHER COMPREHENSIVE INCOME 
Items that may be reclassified to profit or loss: 
Exchange differences on translation of foreign operations       547    (705) 
----------------------------------------------------------  -------  ------- 
TOTAL COMPREHENSIVE INCOME FOR THE YEAR                       3,607      598 
----------------------------------------------------------  -------  ------- 
Total comprehensive income attributable to: 
Owners of the parent                                          2,542      143 
Non-controlling interests                                     1,065      455 
----------------------------------------------------------  -------  ------- 
                                                              3,607      598 
----------------------------------------------------------  -------  ------- 
 

The notes form part of these financial statements

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2020

 
                                          2020     2019 
                                Notes  GBP'000  GBP'000 
------------------------------  -----  -------  ------- 
ASSETS 
NON-CURRENT ASSET 
Intangible assets                  12   23,443   24,706 
Property, plant and equipment      13    2,696    2,516 
Right-of-use assets                25   31,599   27,385 
Investments                        16        1        1 
Trade and other receivables        17      252    1,050 
Deferred tax                        9      707      210 
------------------------------  -----  -------  ------- 
                                        58,698   55,868 
------------------------------  -----  -------  ------- 
CURRENT ASSETS 
Inventories                                 59      118 
Trade and other receivables        17   66,723   60,927 
Cash and cash equivalents               12,720   11,951 
------------------------------  -----  -------  ------- 
                                        79,502   72,996 
------------------------------  -----  -------  ------- 
TOTAL ASSETS                           138,200  128,864 
------------------------------  -----  -------  ------- 
 
 
                                                                                       2020     2019 
                                                                             Notes  GBP'000  GBP'000 
---------------------------------------------------------------------------  -----  -------  ------- 
EQUITY 
SHAREHOLDERS' EQUITY 
Called up share capital                                                         22    7,132    6,854 
Share premium                                                                   23   13,139   11,987 
Equity reserve                                                                  23        1       16 
Translation reserve                                                             23      581       70 
Merger reserve                                                                  23    3,102    3,102 
Retained earnings                                                               23    5,901    6,094 
---------------------------------------------------------------------------  -----  -------  ------- 
Issued share capital and reserves attributable to the owners of the parent           29,856   28,123 
Non-controlling interests                                                             1,332      887 
---------------------------------------------------------------------------  -----  -------  ------- 
TOTAL EQUITY                                                                         31,188   29,010 
---------------------------------------------------------------------------  -----  -------  ------- 
LIABILITIES 
NON-CURRENT LIABILITIES 
Provisions                                                                      20    2,153    1,674 
Lease liabilities - right-of-use assets                                         25   25,376   21,535 
Interest bearing loans and borrowings                                           19    1,896    2,275 
Trade and other payables                                                        18      132      101 
Deferred tax liability                                                           9    1,697    1,968 
---------------------------------------------------------------------------  -----  -------  ------- 
                                                                                     31,254   27,553 
---------------------------------------------------------------------------  -----  -------  ------- 
CURRENT LIABILITIES 
Trade and other payables                                                        18   64,828   58,579 
Lease liabilities - right-of-use assets                                         25    6,864    6,392 
Deferred consideration                                                          18        -    4,607 
Interest bearing loans and borrowings                                           19    4,066    2,723 
---------------------------------------------------------------------------  -----  -------  ------- 
                                                                                     75,758   72,301 
---------------------------------------------------------------------------  -----  -------  ------- 
TOTAL LIABILITIES                                                                   107,012   99,854 
---------------------------------------------------------------------------  -----  -------  ------- 
TOTAL EQUITY AND LIABILITIES                                                        138,200  128,864 
---------------------------------------------------------------------------  -----  -------  ------- 
 

The notes form part of these financial statements

The financial statements were approved by the Board of Directors on 12 April 2021 and were signed by:

 
Robert Ross 
CEO 
 
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEARED 31 DECEMBER 2020

 
                                    Share    Share   Equity  Translation   Merger  Retained                      Total 
                                  Capital  Premium  Reserve      Reserve  Reserve  Earnings    Total      NCI   Equity 
                           Notes  GBP'000  GBP'000  GBP'000      GBP'000  GBP'000   GBP'000  GBP'000  GBP'000  GBP'000 
-------------------------  -----  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Carried forward 
 31 December 2019                   6,854   11,987       16           70    3,102     6,094   28,123      887   29,010 
-------------------------  -----  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Contributions by and 
distribution to owners 
Dividends paid                11      278    1,152        -            -        -   (2,066)    (636)    (546)  (1,182) 
Transfer on acquisition 
of 
non-controlling interest                -        -        -            -        -     (158)    (158)      158        - 
Acquisition of subsidiary               -        -        -            -        -         -        -    (232)    (232) 
Share option charge           24        -        -     (15)            -        -         -     (15)        -     (15) 
-------------------------  -----  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Total contribution by and 
 distribution to owners               278    1,152     (15)            -        -   (2,224)    (809)    (620)  (1,429) 
-------------------------  -----  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Profit for the year                     -        -        -            -        -     2,031    2,031    1,029    3,060 
Exchange differences 
on translation of 
foreign operations                      -        -        -          511        -         -      511       36      547 
-------------------------  -----  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Total comprehensive 
 income for the year                    -        -        -          511        -     2,031    2,542    1,065    3,607 
-------------------------  -----  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Balance at 31 December 
 2020                               7,132   13,139        1          581    3,102     5,901   29,856    1,332   31,188 
-------------------------  -----  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
 
 
                                    Share    Share   Equity  Translation   Merger  Retained                      Total 
                                  Capital  Premium  Reserve      Reserve  Reserve  Earnings    Total      NCI   Equity 
                           Notes  GBP'000  GBP'000  GBP'000      GBP'000  GBP'000   GBP'000  GBP'000  GBP'000  GBP'000 
------------------------  ------  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Carried forward 
 31 December 2018                   6,736   11,868       38          737    2,323     6,773   28,475      586   29,061 
------------------------  ------  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Contributions by and 
distribution to owners 
Dividends paid            11, 22        -        -        -            -        -   (1,522)  (1,522)    (154)  (1,676) 
Share based 
consideration 
on acquisition                22       87        -        -            -      779         -      866        -      866 
Share option charge           24        -        -       11            -        -         -       11        -       11 
Share options exercised       24       31      119     (33)            -        -        33      150        -      150 
------------------------  ------  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Total contribution by 
 and distribution to 
 owners                             6,854   11,987       16          737    3,102     5,284   27,980      432   28,412 
------------------------  ------  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Profit for the year                     -        -        -            -        -       810      810      493    1,303 
Exchange differences 
on translation of 
foreign operations                      -        -        -        (667)        -         -    (667)     (38)    (705) 
------------------------  ------  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Total comprehensive 
 income for the year                    -        -        -        (667)        -       810      143      455      598 
------------------------  ------  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
Balance at 
 31 December 2019                   6,854   11,987       16           70    3,102     6,094   28,123      887   29,010 
------------------------  ------  -------  -------  -------  -----------  -------  --------  -------  -------  ------- 
 

The notes form part of these financial statements

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEARED 31 DECEMBER 2020

 
                                                               2020     2019 
                                                     Notes  GBP'000  GBP'000 
---------------------------------------------------  -----  -------  ------- 
Continuing Operations 
Cash flows from operating activities 
Cash generated from operations                           1   15,862   15,803 
Interest paid                                                 (948)    (909) 
Tax paid                                                      (848)    (729) 
---------------------------------------------------  -----  -------  ------- 
Net cash from operating activities                           14,066   14,165 
---------------------------------------------------  -----  -------  ------- 
Cash flows from investing activities 
Purchase of tangible fixed assets                       13    (860)  (1,321) 
Purchase of intangible fixed assets                     12    (489)    (498) 
Cash proceeds on disposal of intangible assets                  397        - 
Cash proceeds from sale & leaseback                           2,900        - 
Net cash acquired from acquisitions                         (3,650)        - 
Cash paid on deferred consideration of acquisition          (4,368)    (206) 
Interest received                                        8       43       29 
---------------------------------------------------  -----  -------  ------- 
Net cash outflow from investing activities                  (6,027)  (1,996) 
---------------------------------------------------  -----  -------  ------- 
Cash flows from financing activities 
New loans in year                                       19    1,350        - 
Loan repayments in year                                 19    (386)  (1,217) 
Share issue (net of share issue costs)                  22        -      150 
Transactions with non-controlling interests             15        -      (6) 
Dividends paid                                          11    (636)  (1,522) 
Repayment on leases                                         (7,587)  (6,546) 
Non-Controlling interest dividends paid                 15    (546)    (154) 
---------------------------------------------------  -----  -------  ------- 
Net cash outflow from financing activities                  (7,805)  (9,295) 
---------------------------------------------------  -----  -------  ------- 
Increase in cash and cash equivalents                           234    2,874 
---------------------------------------------------  -----  -------  ------- 
Cash and cash equivalents at beginning of year               11,951    9,647 
Effect of foreign exchange rate movements                       535    (570) 
---------------------------------------------------  -----  -------  ------- 
Cash and cash equivalents at end of year                     12,720   11,951 
---------------------------------------------------  -----  -------  ------- 
 

The notes form part of these financial statements

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARED 31 DECEMBER 2020

1. RECONCILIATION OF PROFIT BEFORE INCOME TAX TO CASH GENERATED FROM OPERATIONS

 
                                                                                     2020     2019 
                                                                                  GBP'000  GBP'000 
--------------------------------------------------------------------------------  -------  ------- 
Profit before income tax before ordinary activities before results of associate     3,934    2,235 
Loss of equity accounted associate                                                      -     (60) 
Depreciation charges                                                                7,168    6,990 
Amortisation charges                                                                1,730    1,587 
(Profit)/Loss on disposal of property, plant and equipment                          (787)       32 
Loss on Disposal of intangible assets                                                 339        - 
Finance costs                                                                       1,464    1,674 
Finance income                                                                       (95)     (81) 
Share based payments charge                                                          (15)     (11) 
Deferred consideration (credit)/charge                                              (344)      666 
Disposal of EshopWedrop subsidiaries                                                  270        - 
--------------------------------------------------------------------------------  -------  ------- 
                                                                                   13,664   13,032 
--------------------------------------------------------------------------------  -------  ------- 
Decrease/(Increase) in inventories                                                     59     (60) 
(Increase) in trade and other receivables                                         (4,998)    (473) 
Increase in trade and other payables                                                6,735    3,153 
Increase in provisions                                                                402      151 
--------------------------------------------------------------------------------  -------  ------- 
Cash generated from operations                                                     15,862   15,803 
--------------------------------------------------------------------------------  -------  ------- 
 

2. ACCOUNTING POLICIES

Description of the business

Xpediator Plc (the "Company") is a public limited company, incorporated in England and Wales, United Kingdom. The registered office is 700 Avenue West, Skyline 120 Great Notley, Braintree, Essex, CM77 7AA and the Company registration number is 10397171.

The consolidated financial statements comprise the financial information of the Company and its subsidiary undertakings (together the "Group"). Detail of the entities of the Group are described in Note 14.

Basis of preparation

The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU issued by the International Accounting Standards Board, under the historical cost convention. Accounting policies have been consistently applied from 2019.

The presentation currency used for the preparation of the financial statements is Pounds Sterling (GBP), which is the currency of choice of the principal investors of the Group. The amounts are rounded to the nearest thousand, unless otherwise stated.

The preparation of financial statements in conformity with IFRSs requires the use of certain accounting estimates. It also requires the directors to exercise their judgement in the process of applying the Group's accounting policies (see Note 2.1 - Critical accounting estimates and judgements).

Going concern

The Group meets its working capital requirements through the receipt of revenues from the provision of its services in the UK and in CEE, the management of capital and operating expenditure, from the working capital and other borrowing facilities available to it and, from time to time, from the issue of equity capital.

Ultimately the receipt of revenues and charges due to the Group depends on the availability of liquidity for the company's customers and the level of transport and logistics activity in the market.

Covid-19 has impacted our business in many ways. Throughout the pandemic our primary focus has been on the well--being and safety of our people, customers and suppliers. The Group has traded strongly through this extraordinary period and whilst activities are broadly similar to prior years, the freight forwarding division has been strong throughout. Those area's which are dependent on either traffic volumes (Transport Solutions) or exposed to market conditions with Government restrictions, such as Easy Managed Transport Limited ("EMT")(UK High Street Fashion) or Benfleet Forwarding Limited (with China and Italy being key markets) experienced reduced trading levels in the earlier part of the year. Whilst conditions for fashion retailers in the UK High Street and therefore EMT, remain tough, all other parts of the Group are back to trading ahead of or broadly in-line with pre-pandemic levels.

During the pandemic, the Group identified some good developmental opportunities, whilst challenging and flexing the cost base to meet the demand. In March 2020, the Group took the decision to introduce temporary pay reductions, to reduce costs in areas of reduced activity and suspend certain capital investment projections as the fully extent of the pandemic was initially unknown. By August 2020, the Group had reinstated salaries back to their normal levels and any salary reductions have been repaid in full.

At 31 December 2020 the Group had cash and cash equivalents of GBP12,720,000 (2019: GBP11,951,000). The Group also has funding facilities in place, details of which are set out in note 19 of the financial statements, which it does not envisage will be withdrawn.

Having regard to the above, and based on their latest assessment of the budgets and forecasts for the business of the company, the directors consider that there are sufficient funds available to the Group to enable it to meet its liabilities as they fall due for a period of not less than twelve months from the date of approval of the financial statements. The directors therefore consider it appropriate to adopt the going concern basis of accounting in preparing the financial statements.

Basis of consolidation

The Group financial statements consolidate the financial statements of Xpediator Plc and its subsidiaries drawn up to 31 December each year. Subsidiaries are consolidated from the date of their acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases. The Company has control over a subsidiary if all three of the following elements are present: power over the investee, exposure to variable returns from the investee, and the ability of the investor to use its power to affect those variable returns. Control is reassessed whenever facts and circumstances indicate that there may be a change in any of these elements of control.

The financial statements of subsidiaries are prepared for the same reporting year as the parent Company, using consistent accounting policies. Intra-group balances and transactions, including unrealised profits arising from intra-Group transactions, have been eliminated. Unrealised losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. Non-controlling interests represent the equity in subsidiaries that is not attributable, directly or indirectly, to Xpediator Plc.

Subsequent to the merger accounting noted below the consolidated financial statements incorporate the results of business combinations using the acquisition method. In the statement of financial position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the consolidated income statement from the date on which control is obtained. They are deconsolidated from the date on which control ceases.

Merger accounting

On 25 May 2017, the Company entered into a share swap agreement with the ultimate beneficiaries of Delamode Group Holdings Limited, whereby 4,000,000 new ordinary shares of GBP1.00 each were issued to the ultimate beneficiaries of Delamode Group Holdings Limited in exchange for their shares in Delamode Group Holdings Limited in the same proportion as their shareholding in Delamode Group Holdings Limited. The merger method of accounting is used to consolidate the results of Xpediator Plc.

On 8 June 2018, the Company issued 1,727,694 new ordinary shares of GBP0.05 each as part of the deferred consideration of Easy Managed Transport Limited ("EMT"). On 14 July 2018, the Company issued 3,740,648 new ordinary shares of GBP0.05 each as part of the acquisition of Import Services Limited. On 31 December 2018, the Company issued 84,951 new ordinary shares of GBP0.05 each as part of the deferred consideration of Regional Express Limited ("Regional"). On 16 May 2019, the Company issued 1,655,876 shares to the former owners of EMT as part of the payment of the deferred consideration relating to the acquisition of the entire equity of EMT in 2017. On 5 December 2019, the Company issued 89,744 shares to the former owners of Regional as part of the payment of the deferred consideration relating to the acquisition of the entire equity of Regional in 2017. The premium on the fair value in excess of the nominal value of shares issued in consideration of business combinations is credited to the merger reserve.

Revenue

The Group generates revenue in the UK and Europe.

The Group operates a number of diverse businesses and accordingly applies a variety of methods for revenue recognition, based on the principles set out in IFRS 15. The revenue and profits recognised in any reporting period are based on the delivery of performance obligations and an assessment of when control is transferred to the customer. In determining the amount of revenue and profits to record, and associated statement of financial position items (such as trade receivables, contract assets and contract liabilities), management is required to review performance obligations within individual contracts. This may involve some judgemental areas (for example within the logistics & warehousing business), where revenue is recorded in advance of invoicing the customer.

Revenue is recognised either when the performance obligation in the contract has been performed (so 'point in time' recognition) or 'over time' as control of the performance obligation is transferred to the customer. For all contracts, the Group determines if the arrangement with a customer creates enforceable rights and obligations, which is in line with our contractual commitments and industry standard best practice (for example Convention Relative au Contrat de Transport International de Marchansies par la Route or CMR).

For each performance obligation to be recognised over time, the Group applies a revenue recognition method that faithfully depicts the Group's performance in transferring control of the goods or services to the customer. This decision requires assessment of the real nature of the goods or services that the Group has promised to transfer to the customer. The Group has assessed the period of time principles as follows:

-- Customers receives the benefits of the good being moved from the origin to the destination, as another supplier would not need to re-perform the service performed to date (i.e. the goods have been moved partway).

-- The customer becomes committed to pay the Group the moment that the goods are despatched and collected.

-- The customer accepts that they are liable to pay for the transaction in full although it is the Group's responsibility to ensure that the shipment is in transit before invoicing.

-- The customer can usually be invoiced on despatch/export and has an obligation to pay for services despite any problems that may arise in transit.

-- The Group would hold any third party liable for any issues that happen in transit that is beyond its reasonable control.

The Group recognises that it acts as both an agent and a principal. The Group is a principal if it responsible for the specified good or service before that good or service is transferred to a customer. The Group is an agent if it is not responsible for arranging for the provision of the specified good or service by another party. In this case, the Group does not control the specified good or service provided by another party before that good or service is transferred to the customer. When the Group acts as an agent, it recognises revenue in the amount of any fee or commission to which it expects to be entitled in exchange for arranging for the specified goods or services to be provided by the other party. The Affinity business (see Affinity section of revenue recognition policy) primarily operates as an agent, and largely recognises only the commission earned as revenue.

Freight Forwarding

Under IFRS 15, freight forwarding revenue is recognised over the period of time based on the principles identified above. Therefore, revenue will consist of freight delivered during the period as well as a proportion of revenue for service delivered that are in process as at the end of the reporting period, which is calculated on a time proportioned basis.

Logistics & Warehousing

Logistics & warehousing revenue is recognised over a period of time. Invoicing varies by contract but is typically in line with work performed. Due to the different contractual arrangements in place, each customer is assessed to determine the amount of work carried out, which has not been invoiced at the date of the Group's reporting period. This revenue is recognised by direct reference to the amount of work carried out to deliver the service and measured relative to cost or over the time period which the warehousing is provided. Judgement is therefore required when determining the appropriate timing and amount of revenue that can be recognised. The revenue from handling of incoming products is recognised when a performance obligation is satisfied, but not invoiced at the reporting date, which is correspondingly accrued on the statement of financial position within contract assets.

Affinity

Revenue is recognised at a point in time only after the performance obligation has been actually been satisfied. Affinity and trucking services revenue largely acts as an agent based on the assessment above, so only commission is recorded as revenue. This largely relates to provision of DKV fuel cards, which enables the customer to purchase fuel, tolls and other services.

In addition, the Affinity business operates as a reseller ferry crossing, where revenue is recorded at a point in time as it is based on the performance obligation being delivered. Revenue for this part of the business is recorded as a principal due to the assessments identified above.

Gross billings (Affinity)

Recoverable disbursements incurred on behalf of our Affinity Division customers based in Romania and the West Balkans include fuel costs, toll charges and breakdown assistance. The gross billings figure is included within the Groups trade payables and receivables but are excluded from consolidated income statement revenue. The gross billing revenue number is a non-statutory measure but is included to make a more meaningful calculation of days sales outstanding and days payable outstanding, so it is important to understand the level of billings going through the sales and purchase ledgers.

Franchise income

Income relating to franchise fees are not recorded as revenues by the Group but are shown as other income. This revenue arises from the sales of services to the franchisees. This income is recognised over a period of time based on when the services have been transferred to the franchisee in accordance with the terms and conditions of the relevant agreements.

Franchise fees comprise of revenue for the initial allocation of the franchise to the respective member, IT support, marketing and the use of the intellectual property.

Business combinations

Acquisitions of subsidiaries and businesses are accounted for using the purchase method. The cost of the business combination is measured as the aggregate of the fair values (at the date of exchange) of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for control of the acquiree. The Group recognises any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest's proportionate share of the acquired entity's net identifiable assets.

The acquiree's identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS 3: Business Combinations are recognised at their fair values at the acquisition date.

Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the business combination over the Group's interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised.

If the cost of the acquisition is less than the Group's interest in the net fair value of the acquiree's identifiable assets, liabilities and contingent liabilities, the difference is recognised directly in the Consolidated Income Statement.

Associates

The Group obtained operational and management control of International Cargo Centre Limited and as a result this has met the conditions for recognition under IFRS 3: Business Combinations from the 1 January 2020. Previously this was reported as an associate company and equity accounted.

Non-controlling interests

The total comprehensive income of non-wholly owned subsidiaries is attributed to owners of the parent and to the non-controlling interests in proportion to their relative ownership interests.

Goodwill

Goodwill arising on the acquisition of a business represents any excess of the fair value of the consideration over the fair value of the identifiable assets and liabilities acquired. The identifiable assets and liabilities acquired are incorporated into the consolidated financial statements at their fair value to the Group.

Goodwill is not amortised but tested for impairment annually. Any impairment is recognised immediately in the consolidated income statement and is not subsequently reversed. On disposal of a business, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

Impairment of non-financial assets (excluding inventories and deferred tax assets)

Impairment tests on goodwill with indefinite useful economic lives are undertaken annually in November as part of the Group's budgeting process, except in the year of acquisition when they are tested at the year-end. Other non-financial assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amount (i.e. the higher of value in use and fair value less costs to sell), the asset is written down accordingly.

Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the smallest Group of assets to which it belongs for which there are separately identifiable cash flows; its Cash Generating Units ("CGUs"). Goodwill is allocated on initial recognition to each of the Group's CGUs that are expected to benefit from a business combination that gives rise to the goodwill. Impairment charges are included in profit or loss, except to the extent they reverse gains previously recognised in other comprehensive income. An impairment loss recognised for goodwill is not reversed.

Foreign currencies

The financial statements of the Group are presented in its reporting currency of Sterling. The functional currency of each Group entity is the currency of the primary economic environment in which the entity operates.

Transactions in foreign currencies during the period have been converted at the rates of exchange ruling on the date of the transaction. Assets and liabilities denominated in foreign currencies have been translated at the rates of exchange ruling on the reporting date. Any gains or losses arising from these conversions are credited or charged to the Consolidated Income Statement.

On consolidation, the results of overseas operations are translated into Sterling at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations, including goodwill arising on the acquisition of those operations, are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income and accumulated in the translation reserve.

On disposal of a foreign operation, the cumulative exchange differences recognised in the foreign exchange reserve relating to that operation up to the date of disposal are transferred to the consolidated statement of comprehensive income as part of the profit or loss on disposal.

Financial assets

The Group classifies its financial assets into the categories discussed below, depending on the purpose for which the asset was acquired. The Group only has financial assets classified as held at amortised cost. The financial assets comprise of trade and other receivables and cash and cash equivalents in the consolidated statement of financial position.

Cash and cash equivalents includes cash in hand, deposits held with banks, and - for the purpose of the statement of cash flows - bank overdrafts. Bank overdrafts are shown within loans and borrowings in current liabilities on the consolidated statement of financial position, unless there is a right of set-off between bank accounts across the Group. In this instance, the net cash position will be shown.

These assets arise principally from the provision of goods and services to customers (e.g. trade receivables), but also incorporate other types of financial assets where the objective is to hold these assets in order to collect contractual cash flows and the contractual cash flows are solely payments of principal and interest. Trade receivables are recognised initially at the transaction price and other financial assets are initially recognised at fair value plus transaction costs that are directly attributable to their acquisition or issue. They are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment.

Impairment provisions for current and non-current trade receivables are recognised based on the simplified approach within IFRS 9 using a historical provision matrix in the determination of the lifetime expected credit losses. During this process the probability of the non-payment of the trade receivables is assessed. This probability is then multiplied by the amount of the expected loss arising from default to determine the lifetime expected credit loss for the trade receivables. For trade receivables, which are reported net, such provisions are recorded in a separate provision account with the loss being recognised within administration costs in the consolidated statement of comprehensive income. On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the associated provision.

Impairment provisions for receivables from related parties and loans to related parties are recognised based on a forward looking expected credit loss model. The methodology used to determine the amount of the provision is based on whether there has been a significant increase in credit risk since initial recognition of the financial asset. For those for which credit risk has increased significantly, lifetime expected credit losses are recognised, unless further information becomes available contrary to the increased credit risk. For those that are determined to be permanently credit impaired, lifetime expected credit losses are recognised.

Capital management

The Group monitors its risk to a shortage of funds using a recurring liquidity planning tool. This tool considers the maturity of both its financial investments and financial assets (e.g. accounts receivables, other financial assets) and projected cash flows from operations.

The Group's objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, invoice discounting and long-term loan finance.

Financial liabilities

The Group classifies its financial liabilities into two categories - other financial liabilities and fair value through profit and loss:

Other financial liabilities

The Group's other financial liabilities include bank loans, confidential invoice discounting facility, trade and other payables and accruals. Bank borrowings are initially recognised at fair value net of any transaction costs directly attributable to the issue of the instrument. Such interest bearing liabilities are subsequently measured at amortised cost using the effective interest rate method, which ensures that any interest expense over the period to repayment is at a constant rate on the balance of the liability carried in the consolidated statement of financial position. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

Trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried at amortised cost using the effective interest method.

Fair value through profit and loss

This category only comprises of the element of deferred consideration on business combinations, which is contingent on the performance of the acquired businesses. There is no deferred consideration outstanding at this reporting date (2019 - GBP4,607,000).

Share capital

Financial instruments issued by the Company are classified as equity only to the extent that they do not meet the definition of a financial liability or financial asset. The company's ordinary shares are classified as equity instruments.

Leased assets

IFRS 16 has introduced a single, on-balance sheet accounting model for lessees, eliminating the distinction between operating and finance leases. IFRS 16 has impacted how the Group accounts for leases under IAS 17.

The Group assesses at inception whether the contract is, or contains, a lease. A lease exists if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Group assessment includes whether:

   --          the contract involves the use of an identified asset; 

-- the Group has the right to obtain substantially all of the economic benefits from the use of the asset throughout the contract period; and

   --          the Group has the right to direct the use of the asset. 

At the commencement of a lease, the Group recognises a right-of-use asset along with a corresponding lease liability.

The lease liability is initially measured at the present value of the remaining lease payments, discounted using the individual entities incremental borrowing rate. The lease term comprises the non-cancellable period of the contract, together with periods covered by an option to extend the lease where the Group is reasonably certain to exercise that option based on operational needs and contractual terms. Subsequently, the lease liability is measured at amortised cost by increasing the carrying amount to reflect interest on the lease liability and reducing it by the lease payments made. The lease liability is remeasured when the Group changes its assessment of whether it will exercise an extension or termination option.

Right-of-use assets are initially measured at cost, comprising the initial measurement of the lease liability adjusted for any lease payments made at or before the commencement date, lease incentives received and initial direct costs. Subsequently, right-of-use assets are measured at cost, less any accumulated depreciation and any accumulated impairment losses, and are adjusted for certain remeasurements of the lease liability.

The incremental borrowing rate is calculated on a lease by lease basis. The weighted average lessee's borrowing rate applied to the lease liabilities is 3.27% (2019 - 3.42%).

Depreciation is calculated on a straight-line basis over the length of the lease. The Group has elected to apply exemptions for short-term leases and leases for which the underlying asset is of low value. For these leases, payments are charged to the income statement on a straight-line basis over the term of the relevant lease. Right-of-use assets are presented within non-current assets on the face of the statement of financial position, and lease liabilities are shown separately on the statement of financial position in current liabilities and non-current liabilities depending on the maturity of the lease payments.

Under IFRS 16, right-of-use assets will be tested for impairment in accordance with IAS 36 Impairment of Assets. This has replaced the previous requirements to recognise a provision for onerous lease contracts.

Payments associated with short-term leases are recognised on a straight-line basis as an expense in the profit or loss. Short term leases are leases with a lease term of 12 months or less.

Externally acquired intangible assets

Externally acquired intangible assets, other than Goodwill, are initially recognised at cost and subsequently amortised on a straight -- line basis over their useful economic lives.

Intangible assets are recognised on business combinations if they are separable from the acquired entity or give rise to other contractual/legal rights. The amounts ascribed to such intangibles are arrived at by using appropriate valuation techniques (see section related to critical estimates and judgements below).

The significant intangibles recognised by the Group, their useful economic lives and the methods used to determine the cost of intangibles acquired in a business combination are as follows:

 
Intangible asset         Useful economic life  Valuation method 
-----------------------  --------------------  ---------------------------- 
Licences and trademarks  3-25 years            Multiple of historic profits 
Customer Related         6-10 Years            Excess Earning Model 
Technology Based         5 Years               Replacement Cost 
-----------------------  --------------------  ---------------------------- 
 

Taxation

The charge for current tax is based on the taxable income for the period. The taxable result for the period differs from the result as reported in the statement of comprehensive income because it excludes items which are not assessable or disallowed and it further excludes items that are taxable and deductible in other years. It is calculated using tax rates that have been enacted or substantially enacted by the statement of financial position date.

Deferred income tax is provided using the liability method, for all temporary differences arising between the tax bases of assets and liabilities and their carrying values for financial reporting purposes.

Deferred tax assets are recognised only to the extent that future taxable profit will be available such that realisation of the related tax benefits is probable. The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the reporting date and are expected to apply when the deferred tax liabilities/ (assets) are settled/(recovered).

Property, plant and equipment

Items of property, plant and equipment are initially recognised at cost. As well as the purchase price, cost includes directly attributable costs and the estimated present value of any future unavoidable costs of dismantling and removing items. The corresponding liability is recognised within provisions.

Freehold land is not depreciated. Depreciation on assets under construction does not commence until they are complete and available for use. Depreciation is provided on all other items of property, plant and equipment so as to write off their carrying value over their expected useful economic lives. It is provided at the following rates:

 
Freehold buildings     2%-10% per annum straight line 
                       20-33% per annum straight line/10% - 25% on reducing 
Fixtures and fittings   balance 
                       33% per annum straight line/20% - 50% on reducing 
Computer equipment      balance 
                       25-33% per annum straight line/20% - 25% on reducing 
Motor vehicles          balance 
---------------------  ---------------------------------------------------- 
 

Dividends

Dividends are recognised when they become legally payable. In the case of final dividends, this is when approved by the shareholders at the annual general meeting.

Holiday pay accrual

All employees accrue holiday pay during the calendar year, the board encourages all employees to use their full entitlement throughout the year, however in the unlikely case that an employee has untaken holiday pay this is accrued for at the daily salary costs, including costs of employment, such as social security.

Staff pensions

The Group does not operate a pension scheme for its employees however it does make payments to defined contribution pension schemes on behalf of employees in the UK in accordance with auto enrolment legislation. The payments made are recognised as an expense in the period to which they relate.

Share-based payments

Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of the equity instruments at the grant date.

The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group's estimate of equity instruments that will eventually vest. At each reporting date, the Group revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognised in profit or loss over the remaining vesting period, with a corresponding adjustment to the equity-settled employee benefits reserve.

Equity-settled share-based payment transactions with other parties are measured at the fair value of the goods or services received, except where the fair value cannot be estimated reliably, in which case they are measured at the fair value of the equity instruments granted, measured at the date the entity obtains the goods or the counterparty renders the service.

Provisions

The Group has recognised provisions for liabilities of the uncertain timing or amount for leasehold dilapidations. The provision is measured at the best estimate of the expenditure required to settle the obligation at the reporting date, discounted at a pre-tax rate reflecting current market assessments of the time value of money and risks specific to the liability. The provision takes into account the potential that the properties in question may be sublet for some or all of the remaining lease term.

2.1 Critical Accounting Estimates And Judgements

The Group makes certain estimates and assumptions regarding the future. Management also needs to exercise judgement in applying the Group's accounting policies. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions.

2.1.1 Principal estimates

   --          Fair value measurement of intangible assets acquired in business combination; 

A number of assets and liabilities included in the Group's financial statements require measurement at, and/ or disclosure of, fair value. As there are no easily identifiable valuation methods for intangible assets such as customer relationships and licences, estimation is required in assessing the fair value when accounting for a business combination. The Group recognised Goodwill and associated intangibles before amortisation of GBP26,928,000 (2019 - GBP26,733,00). This is disclosed in note 12 and note 30.

   --          Estimated impairment of goodwill 

The Group frequently tests whether goodwill has suffered any impairment. These calculations require the use of estimates, both in arriving at the expected future profitability of the entity and the application of a suitable discount rate in order to calculate the present value of these flows. As the impairment of goodwill is based on a future forecast, the Group has used a level of judgement around key assumptions of future cashflows greater than 12 months. Details of the impairment and sensitivity of cashflows are disclosed in note 12.

   --         Trade receivables 

In accordance with IFRS 9, the Group assesses whether the credit risk has increased significantly since initial recognition, the Group compares the risk of a default occurring on the financial instrument both due within one year and more than one year as at the reporting date with the risk of a default occurring on the trade receivable as at the date of initial recognition. In making this assessment, the Group considers both quantitative and qualitative information that is reasonable and supportable, including historical experience and forward-looking information that is available without undue cost or effort. The Group has trade receivables less provision for expected credit losses at the year-end of GBP55,032,000 (2019 - GBP51,160,000).

   --          Deferred Tax 

Deferred tax assets have been recognised in relation to trading losses generated in the entities, these have been restricted to those instances where it is probable that the assets will be utilised against future trading profits. The Group has recognised a deferred tax asset of GBP707,000 (2019 - GBP210,000) and a deferred tax liability of GBP1,697,000 (2019 - GBP1,968,000).

3. REVENUE ANALYSIS BY COUNTRY

 
                    2020     2019 
                 GBP'000  GBP'000 
---------------  -------  ------- 
United Kingdom    83,194   89,701 
Lithuania         63,988   55,849 
Romania           33,640   33,189 
Bulgaria          25,635   21,819 
Serbia             6,629    6,475 
Other              8,140    6,214 
---------------  -------  ------- 
Total revenue    221,226  213,247 
---------------  -------  ------- 
 

The table below shows revenue by timing of transfer of goods and services:

3A) REVENUE FROM CONTRACTS WITH CUSTOMERS

 
                           2020     2019 
                        GBP'000  GBP'000 
----------------------  -------  ------- 
Over a period of time   215,483  207,080 
At a point in time        5,743    6,167 
----------------------  -------  ------- 
Total revenue           221,226  213,247 
----------------------  -------  ------- 
 

Revenue is derived from three main divisions: Transport solutions, referred to as Affinity, Freight Forwarding, and Logistics & warehousing, as detailed in note 7.

3B) CONTRACT ASSETS

 
                               2020     2019 
                            GBP'000  GBP'000 
--------------------------  -------  ------- 
At 1 January                  1,367    2,068 
Net movement for the year      (32)    (701) 
--------------------------  -------  ------- 
At 31 December                1,335    1,367 
--------------------------  -------  ------- 
 

Contract assets are included within trade and other receivables on the face of the statement of financial position.

By the nature of the Group's invoicing procedures, then the Group does not have any contract liabilities.

3C) NON CURRENT ASSETS BY COUNTRY

 
                              2020     2019 
                           GBP'000  GBP'000 
-------------------------  -------  ------- 
United Kingdom              42,277   44,113 
Romania                      8,796    9,744 
Lithuania                      782    1,005 
Bulgaria                     6,432      842 
Serbia                         124      136 
Other                          287       28 
-------------------------  -------  ------- 
Total non current assets    58,698   55,868 
-------------------------  -------  ------- 
 

4. OTHER OPERATING INCOME

Other operating income arises mainly from sundry services executed by the Group, not being freight forwarding, logistics and warehousing or affinity services. Since this is not considered to be part of the main revenue generating activities, the Group presents this income separately from revenue.

 
                                    2020     2019 
                                 GBP'000  GBP'000 
-------------------------------  -------  ------- 
Recharges to franchise members       833    1,028 
Recovery of fines/penalties           74       24 
Rental income                         64       65 
Other                                279       76 
-------------------------------  -------  ------- 
Total                              1,250    1,193 
-------------------------------  -------  ------- 
 

5. OPERATING PROFIT

 
                                                                2020     2019 
                                                             GBP'000  GBP'000 
-----------------------------------------------------------  -------  ------- 
Operating profit is stated after charging/(crediting) 
Hire of plant and machinery                                      593      694 
Depreciation - owned assets (note 13)                            915    1,035 
Depreciation - right of use assets (note 25)                   6,253    5,955 
Amortisation of intangible assets (note 12) (1)                1,730    1,587 
Auditors' remuneration - audit                                   313      295 
(Gain) / Loss on disposal of property, plant and equipment     (787)       32 
Lost on disposal of intangible assets (Note 12)                  339        - 
Insurance                                                      1,053      877 
Property/Municipal Taxes                                       1,794    1,722 
Legal costs                                                      259      205 
Other exceptional Items (note 27)                              1,825      856 
Bad debt costs (note 17)                                         853      836 
Credit note provisions on Benfleet vendor income                  24      326 
Foreign exchange losses                                          603     (54) 
Staff expenses (note 6)                                       24,593   23,892 
IT costs                                                       2,149    1,641 
Other administration expenses                                  9,024   10,070 
-----------------------------------------------------------  -------  ------- 
Total                                                         51,533   49,969 
-----------------------------------------------------------  -------  ------- 
 

1 Amortisation charges on the Group's intangible assets are recognised in the administrative expenses line item in the consolidated income statement.

The remuneration paid to Crowe U.K. LLP and its associates; the Group's external auditors is as follows:

 
                                                                        2020     2019 
                                                                     GBP'000  GBP'000 
-------------------------------------------------------------------  -------  ------- 
Audit and Audit Related Services 
The audit of the Company and Group financial statements                   94       92 
The audit of the financial statements of subsidiaries of the Group       209      193 
Other assurance services                                                  10       10 
-------------------------------------------------------------------  -------  ------- 
Total audit and audit related services                                   313      295 
-------------------------------------------------------------------  -------  ------- 
 

6. EMPLOYEE BENEFIT EXPENSES

 
                                                               2020     2019 
                                                            GBP'000  GBP'000 
----------------------------------------------------------  -------  ------- 
Employee benefit expenses (including directors) comprise: 
Wages and salaries                                           22,555   20,397 
Short-term non-monetary benefits                                124      200 
Share based payments                                           (15)       11 
Defined contribution pension cost                               344      245 
Social security contributions and similar taxes               1,585    3,039 
----------------------------------------------------------  -------  ------- 
Total                                                        24,593   23,892 
----------------------------------------------------------  -------  ------- 
 

Key management personnel compensation

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Group, including the directors of the Company.

 
                                       2020     2019 
                                    GBP'000  GBP'000 
----------------------------------  -------  ------- 
Salary                                1,724    1,367 
Short-term non-monetary benefits         53       39 
Share based payments                      -       11 
Defined contribution pension cost        26       20 
----------------------------------  -------  ------- 
Total                                 1,803    1,437 
----------------------------------  -------  ------- 
 

Directors remuneration

 
                                                      2020     2019 
                                                   GBP'000  GBP'000 
-------------------------------------------------  -------  ------- 
Salary & Bonuses                                       856      552 
Payment in lieu of notice and other compensation       458        - 
Other remuneration                                      35       25 
Share based payments                                     -       11 
-------------------------------------------------  -------  ------- 
Total                                                1,349      588 
-------------------------------------------------  -------  ------- 
 

Other remuneration comprises of private family medical cover, company car and insurance benefits.

Total remuneration regarding the highest paid Director is as follows:

 
                                  2020     2019 
                               GBP'000  GBP'000 
-----------------------------  -------  ------- 
Total aggregate remuneration       760      330 
-----------------------------  -------  ------- 
 

The average number of employees (including directors) during the year was as follows:

 
                      2020   2019 
-------------------  -----  ----- 
Freight forwarding     439    396 
Logistics              471    450 
Other                  170    191 
-------------------  -----  ----- 
Total                1,080  1,037 
-------------------  -----  ----- 
 

7. SEGMENTAL ANALYSIS

Types of services from which each reportable segment derives its revenues

The Group had three main divisions: Transport Solutions, referred to as Affinity, Freight Forwarding, and Logistics & Warehousing. All revenue is derived from the provision of services.

-- Freight Forwarding - This division is the core business and relates to the movement of freight goods across Europe. This division accounts for the largest proportion of the Group's business, generating 77% of its external revenues. (2019 - 75%)

-- Affinity - This division is the Transport Solution's arm of the Group. It focuses on the reselling of DKV fuel cards, leasing, ferry crossings and other associated transport related services. This division accounts for 3% of the Group's business in terms of revenue (2019 - 3%)

-- Logistics & Warehousing - This division is involved in the warehousing and domestic distribution; it generates 20% of the Group's external revenues in 2020 (2019 - 22%).

Factors that management used to identify the Group's reportable segments

The Group's reportable segments are strategic business units that offer different products and services. They are managed separately because each business requires different technology and marketing strategies.

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision maker has been identified as the management team comprising the Divisional Chief Operating Officers, the Chief Executive Officer and the Chief Financial Officer.

Measurement of operating segment profit or loss

The Group evaluates segmental performance on the basis of profit or loss from operations calculated in accordance with IFRS. Segment assets and liabilities are measured in the same way in the financial statements and they are allocated based on the operations of the segment.

Inter-segment sales are priced at market rates and at arm's length basis, along the same lines as sales to external customers. This policy was applied consistently throughout the current and prior period.

 
                                                 Freight  Logistics & 
                                              Forwarding  Warehousing   Affinity  Overheads      Total 
                                                    2020         2020       2020       2020       2020 
                                                 GBP'000      GBP'000    GBP'000    GBP'000    GBP'000 
--------------------------------------------  ----------  -----------  ---------  ---------  --------- 
Gross billings                                   170,996       45,595    126,390          -    342,981 
Less recoverable disbursements                         -            -  (120,647)          -  (120,647) 
Total revenue                                    170,996       45,595      5,743          -    222,334 
Inter-segmental revenue                                -      (1,108)          -          -    (1,108) 
--------------------------------------------  ----------  -----------  ---------  ---------  --------- 
Total revenue from external customers            170,996       44,487      5,743          -    221,226 
--------------------------------------------  ----------  -----------  ---------  ---------  --------- 
Depreciation & amortisation 
(excluding right-of-use asset depreciation)        (793)      (1,461)       (49)      (342)    (2,645) 
Segment profit before central overhead 
 allocation 
(excluding exceptional items)                      6,795        2,619      2,311    (5,045)      6,680 
Allocation of central overheads                  (1,210)      (1,004)       (67)      2,281          - 
Segment profit after central overhead 
 allocation 
(excluding exceptional items)                      5,585        1,615      2,244    (2,764)      6,680 
Net finance costs                                                                              (1,369) 
Exceptional items                                                                              (1,377) 
--------------------------------------------  ----------  -----------  ---------  ---------  --------- 
Profit before income tax                                                                         3,934 
--------------------------------------------  ----------  -----------  ---------  ---------  --------- 
Total segment assets                              64,407       34,475     29,670      9,648    138,200 
Total segment equity & liabilities                64,407       34,475     29,670      9,648    138,200 
 
 
                                           Freight  Logistics & 
                                        Forwarding  Warehousing   Affinity  Overheads      Total 
                                              2019         2019       2019       2019       2019 
                                           GBP'000      GBP'000    GBP'000    GBP'000    GBP'000 
--------------------------------------  ----------  -----------  ---------  ---------  --------- 
Gross billings                             159,588       48,239    142,294          -    350,121 
Less recoverable disbursements                   -            -  (136,127)          -  (136,127) 
Total revenue                              159,588       48,239      6,167          -    213,994 
Inter-segmental revenue                          -        (747)          -          -      (747) 
--------------------------------------  ----------  -----------  ---------  ---------  --------- 
Total revenue from external customers      159,588       47,492      6,167          -    213,247 
--------------------------------------  ----------  -----------  ---------  ---------  --------- 
Depreciation & amortisation 
(excluding right-of-use asset 
 depreciation)                             (1,326)      (1,149)       (45)      (102)    (2,622) 
Segment profit before central 
 overhead allocation 
(excluding exceptional items)                3,447        2,889      2,534    (4,186)      4,684 
Allocation of central overheads            (1,120)        (301)       (47)      1,468          - 
Segment profit after central overhead 
 allocation 
(excluding exceptional items)                2,327        2,588      2,487    (2,718)      4,684 
Share of loss of equity accounted 
 associate                                                                                  (60) 
Net finance costs                                                                        (1,593) 
Exceptional items                                                                          (856) 
--------------------------------------  ----------  -----------  ---------  ---------  --------- 
Profit before income tax                                                                   2,175 
--------------------------------------  ----------  -----------  ---------  ---------  --------- 
Total segment assets                        57,002       36,502     29,810      5,550    128,864 
Total segment equity & liabilities          57,002       36,502     29,810      5,550    128,864 
 

8. NET FINANCE COSTS

 
                                                          2020     2019 
                                                       GBP'000  GBP'000 
-----------------------------------------------------  -------  ------- 
Finance income: 
Deposit account interest                                    43       29 
Interest receivable on Benfleet vendor income               52       52 
-----------------------------------------------------  -------  ------- 
Total finance income                                        95       81 
-----------------------------------------------------  -------  ------- 
Finance costs: 
Unwind of discount on deferred consideration               140      346 
Bank loan & confidential invoicing discount interest       324      319 
Right-of-use asset interest                              1,000    1,009 
-----------------------------------------------------  -------  ------- 
                                                         1,464    1,674 
-----------------------------------------------------  -------  ------- 
Net finance costs                                        1,369    1,593 
-----------------------------------------------------  -------  ------- 
 

9. INCOME TAX

Analysis of tax expense

 
                                                                   2020     2019 
                                                                GBP'000  GBP'000 
--------------------------------------------------------------  -------  ------- 
Current tax: 
Tax on profits for the year                                       1,748    1,130 
Adjustments in respect of prior periods                            (16)     (25) 
--------------------------------------------------------------  -------  ------- 
Total current tax payable                                         1,732    1,105 
--------------------------------------------------------------  -------  ------- 
Deferred tax credit                                               (858)    (233) 
--------------------------------------------------------------  -------  ------- 
Total tax expense in consolidated statement of profit or loss       874      872 
--------------------------------------------------------------  -------  ------- 
 

The reconciling items for the difference between the actual tax charge for the year and the standard rate of corporation tax in UK (the ultimate parent company's tax residency) applied to profits for the year are as follows:

 
                                              2020     2019 
                                           GBP'000  GBP'000 
-----------------------------------------  -------  ------- 
Profit before tax                            3,934    2,175 
UK tax charge at 19%                            57        - 
Overseas tax charge                          1,460      406 
Expenses not deductible for tax purposes       116      171 
Movement in deferred tax                     (639)      326 
Adjustment in respect of prior periods        (16)     (25) 
Other                                        (104)      (6) 
-----------------------------------------  -------  ------- 
Total tax expense                              874      872 
-----------------------------------------  -------  ------- 
 

Deferred Tax

 
                                                 2020     2019 
Assets - Arising from Trading losses          GBP'000  GBP'000 
--------------------------------------------  -------  ------- 
Balance as at 1 January                           210      225 
Movement in the year as a result of trading       497     (15) 
--------------------------------------------  -------  ------- 
Balance as at 31 December                         707      210 
--------------------------------------------  -------  ------- 
 
 
                                                             2020     2019 
Liabilities                                               GBP'000  GBP'000 
--------------------------------------------------------  -------  ------- 
Balance as at 1 January                                   (1,968)  (2,204) 
Recognised on the acquisition of subsidiaries (note 30)      (90)        - 
Release to income statements                                  361      248 
Movement in foreign exchange                                    -     (12) 
--------------------------------------------------------  -------  ------- 
Balance as at 31 December                                 (1,697)  (1,968) 
--------------------------------------------------------  -------  ------- 
 

The deferred tax asset relates to losses carried forward at the rate of tax in the relevant jurisdiction.

During the year, the Group recognised a deferred tax asset of GBP497,000 based on UK profits as forecast in the budget period between 2021 and 2023. .

In addition, the Group has potential deferred tax assets for trading losses totalling GBP1,252,000 (2019: GBP1,257,000) arising from certain subsidiaries across the Group. These assets have not been recognised due to insufficient certainty that the suitable profits will be generated in the foreseeable future.

The deferred tax liabilities relate to liabilities arising as part of the Group's acquisitions.

10. EARNINGS PER SHARE

 
                                               2020     2019 
                                               '000     '000 
------------------------------------------  -------  ------- 
Basic weighted average number of shares     138,889  135,147 
Potentially dilutive share options               55      698 
------------------------------------------  -------  ------- 
Diluted weighted average number of shares   138,944  135,845 
------------------------------------------  -------  ------- 
 
 
                                                                                               GBP'000  GBP'000 
---------------------------------------------------------------------------------------------  -------  ------- 
Profit for the year attributable to owners of the parent company                                 2,031      810 
Earnings pence per share - basic                                                                  1.46     0.60 
---------------------------------------------------------------------------------------------  -------  ------- 
Earnings pence per share - diluted                                                                1.46     0.60 
---------------------------------------------------------------------------------------------  -------  ------- 
Profit for the year attributable to owners of the parent company                                 2,031      810 
Exceptional items (note 27)                                                                      1,377      856 
Amortisation of intangible assets arising from acquisitions (note 12)                            1,464    1,407 
Unwind of discount in deferred consideration (note 8)                                              140      346 
Additional interest charge due to IFRS16 accounting standard change                                376      419 
Add back of discount on deferred consideration (note 8)                                           (52)     (52) 
---------------------------------------------------------------------------------------------  -------  ------- 
Profit for the year attributable to owners of the parent company excluding exceptional items     5,336    3,786 
---------------------------------------------------------------------------------------------  -------  ------- 
Earnings pence per share - basic excluding exceptional items                                      3.84     2.80 
---------------------------------------------------------------------------------------------  -------  ------- 
Earnings pence per share - diluted excluding exceptional items                                    3.84     2.79 
---------------------------------------------------------------------------------------------  -------  ------- 
 

11. DIVIDS

 
                                                                2020     2019 
                                                             GBP'000  GBP'000 
-----------------------------------------------------------  -------  ------- 
Final dividend of 1.05p (2019: 1.05p) per ordinary share       1,487    1,430 
-----------------------------------------------------------  -------  ------- 
Interim dividend of 0.45p (2019: 0.28p) per ordinary share       636      381 
-----------------------------------------------------------  -------  ------- 
 

Subject to approval by shareholders, the Group will propose a dividend to shareholders on the register at the close of business on 11 June 2021. The final dividend for 2019 was made by scrip issue of shares.

12. INTANGIBLE ASSETS

Group

 
                                                             Customer  Technology 
                                         Licences  Goodwill   Related     Related    Total 
COST                                      GBP'000   GBP'000   GBP'000     GBP'000  GBP'000 
---------------------------------------  --------  --------  --------  ----------  ------- 
At 1 January 2020                           3,248    14,166    12,057         510   29,981 
Additions                                     489         -         -           -      489 
Acquired through business combinations          -       221       424           -      645 
Disposals                                   (579)     (227)     (223)           -  (1,029) 
Exchange differences                           76         -         -           -       76 
---------------------------------------  --------  --------  --------  ----------  ------- 
At 31 December 2020                         3,234    14,160    12,258         510   30,162 
---------------------------------------  --------  --------  --------  ----------  ------- 
AMORTISATION 
At 1 January 2020                             660     1,845     2,620         150    5,275 
Charge for the year                           266         -     1,362         102    1,730 
Disposals                                   (182)         -     (111)           -    (293) 
Exchange differences                            7         -         -           -        7 
---------------------------------------  --------  --------  --------  ----------  ------- 
At 31 December 2020                           751     1,845     3,871         252    6,719 
---------------------------------------  --------  --------  --------  ----------  ------- 
NET BOOK VALUE 
At 31 December 2020                         2,483    12,315     8,387         258   23,443 
---------------------------------------  --------  --------  --------  ----------  ------- 
At 1 January 2020                           2,588    12,321     9,437         360   24,706 
---------------------------------------  --------  --------  --------  ----------  ------- 
 
 
                                             Customer  Technology 
                         Licences  Goodwill   Related     Related    Total 
COST                      GBP'000   GBP'000   GBP'000     GBP'000  GBP'000 
-----------------------  --------  --------  --------  ----------  ------- 
At 1 January 2019           2,871    13,176    12,057         510   28,614 
Additions                     498         -         -           -      498 
Fair value adjustments          -       990         -           -      990 
Disposals                    (26)         -         -           -     (26) 
Exchange differences         (95)         -         -           -     (95) 
-----------------------  --------  --------  --------  ----------  ------- 
At 31 December 2019         3,248    14,166    12,057         510   29,981 
-----------------------  --------  --------  --------  ----------  ------- 
AMORTISATION 
At 1 January 2019             498     1,845     1,315          48    3,706 
Charge for the year           180         -     1,305         102    1,587 
Disposals                     (1)         -         -           -      (1) 
Exchange differences         (17)         -         -           -     (17) 
-----------------------  --------  --------  --------  ----------  ------- 
At 31 December 2019           660     1,845     2,620         150    5,275 
-----------------------  --------  --------  --------  ----------  ------- 
NET BOOK VALUE 
At 31 December 2019         2,588    12,321     9,437         360   24,706 
-----------------------  --------  --------  --------  ----------  ------- 
At 1 January 2019           2,373    11,331    10,742         462   24,908 
-----------------------  --------  --------  --------  ----------  ------- 
 

The goodwill included in the above note, relates to acquisition of Pallet Express Srl in January 2016, Easy Managed Transport Limited in March 2017, Benfleet Forwarding Limited in October 2017, Regional Express Limited in November 2017, Anglia Forwarding Group Limited in June 2018, Import Services Limited in July 2018, International Cargo Centre Limited in April 2020 and Nidd Transport Limited in October 2020.

The Group disposed of its goodwill and customer related intangible asset in UK Buy on 31 December 2020.

Annual test for impairment

The Group carries out its impairment tests annually in November as part of the budget process and all newly acquired entities are also reviewed for impairment at the reporting date.

Upon acquisition the goodwill and other intangibles are calculated at Cash Generating Unit ("CGU") level, these are then measured based on forecast cash flow projections, the first year of which is based on the CGU's current annual financial budget which has been approved by the board. During the current year, the Directors have reviewed the CGU's to bring this in line with the integration of the Freight Forwarding and Logistics businesses, as well as the internal reporting of these businesses. As a result, the Anglia Forwarding Group Limited, International Cargo Centre Limited and Benfleet Forwarding Limited business will now be assessed as one CGU (collectively known as Delamode Anglia Limited), whilst Import Services Limited and Easy Managed Transport Limited will also be assessed as one CGU (collectively known as Delamode International Logistics Limited). The cash flow projections for years two to five have been derived based on growth rates that are considered to be in line with the market expectations.

The recoverable amount is determined based on value in use calculations. The use of this method requires the estimation of future cash flows and the determination of a discount rate in order to calculate the present value of the cash flows.

In determining the future free cash flow, the main drivers have been revenue and Earnings Before Interest and Tax ("EBIT") margins, with margins remaining at expected levels.

The directors have reviewed the future profit and cash flow forecasts for the next five years and applying a discount rate of between 12.0%-14.0% to the cash flow projections when determining the net present value of these cash flows, it believes there is sufficient headroom in the value of the business to not have to impair the goodwill.

Key assumptions used in the impairment calculations are as follows:

 
                                            Short term     Long Term 
                             Impairment        Revenue       Revenue 
Entity                           WACC %  Growth Rate %  Growth Rates 
---------------------------  ----------  -------------  ------------ 
Pallet Express Srl                 12.0    6.8 to 17.9           3.0 
Delamode Logistics Limited         13.1    8.1 to 17.2           3.0 
Delamode Anglia Limited            13.1    3.1 to 15.0           2.5 
Regional Express Limited           13.2   10.0 to 30.0           3.0 
Nidd Transport Limited             14.0     2.0 to 3.0           3.0 
---------------------------  ----------  -------------  ------------ 
 

The WACC of the Group has been calculated at a rate of between 12.0%-14.0% with each CGU being adjusted to take into consideration a specific Company premium risk factor.

The short term rate growth for each CGU looks into a number of factors including the expected new business or the loss of existing business. These growth rates are based on the internal three year plans submitted by local management and reviewed through a thorough board process during the annual budget cycle.

Sensitivity to changes in key assumptions

The Group has conducted sensitivity analysis on the impairment test of the CGU's classified within continuing operations. The directors believe that there is sufficient headroom in the value of the business to not have to impair the goodwill so accordingly, no impairment provision was recognised in the year (2019 - GBPnil).

13. PROPERTY, PLANT AND EQUIPMENT

 
                                     Freehold      Fixtures     Motor   Computer 
                                     property  and fittings  vehicles  equipment   Totals 
Group                                 GBP'000       GBP'000   GBP'000    GBP'000  GBP'000 
-----------------------------------  --------  ------------  --------  ---------  ------- 
COST 
At 1 January 2020                         269         2,330       759      2,335    5,693 
Additions                                  20           280       145        415      860 
Additions acquired with subsidiary      2,104            61       107         58    2,330 
Disposals                             (2,104)          (36)       (9)       (92)  (2,241) 
Exchange differences                     (31)            31        22         29       51 
-----------------------------------  --------  ------------  --------  ---------  ------- 
At 31 December 2020                       258         2,666     1,024      2,745    6,693 
-----------------------------------  --------  ------------  --------  ---------  ------- 
DEPRECIATION 
At 1 January 2020                          60         1,078       594      1,445    3,177 
Charge for year                            38           405        77        395      915 
Eliminated on disposal                      -          (36)       (9)       (92)    (137) 
Exchange differences                      (1)            15         9         19       42 
-----------------------------------  --------  ------------  --------  ---------  ------- 
At 31 December 2020                        97         1,462       671      1,767    3,997 
-----------------------------------  --------  ------------  --------  ---------  ------- 
NET BOOK VALUE 
At 31 December 2020                       161         1,204       353        978    2,696 
-----------------------------------  --------  ------------  --------  ---------  ------- 
At 1 January 2020                         209         1,252       165        890    2,516 
-----------------------------------  --------  ------------  --------  ---------  ------- 
 
 
                                                         Freehold      Fixtures     Motor   Computer 
                                                         property  and fittings  vehicles  equipment   Totals 
Group                                                     GBP'000       GBP'000   GBP'000    GBP'000  GBP'000 
-------------------------------------------------------  --------  ------------  --------  ---------  ------- 
COST 
At 1 January 2019                                             204         1,895       895      1,919    4,913 
Adjustment for change in accounting policy for IFRS 16          -             -     (100)          -    (100) 
Restated opening balance                                      204         1,895       795      1,919    4,813 
Additions                                                      75           707        80        459    1,321 
Disposals                                                       -         (218)      (88)       (60)    (366) 
Exchange differences                                         (10)          (54)      (28)         17     (75) 
-------------------------------------------------------  --------  ------------  --------  ---------  ------- 
At 31 December 2019                                           269         2,330       759      2,335    5,693 
-------------------------------------------------------  --------  ------------  --------  ---------  ------- 
DEPRECIATION 
At 1 January 2019                                              22           771       567      1,198    2,558 
Charge for year                                                38           536       131        330    1,035 
Eliminated on disposal                                          -         (215)      (85)       (60)    (360) 
Exchange differences                                            -          (14)      (19)       (23)     (56) 
-------------------------------------------------------  --------  ------------  --------  ---------  ------- 
At 31 December 2019                                            60         1,078       594      1,445    3,177 
-------------------------------------------------------  --------  ------------  --------  ---------  ------- 
NET BOOK VALUE 
At 31 December 2019                                           209         1,252       165        890    2,516 
-------------------------------------------------------  --------  ------------  --------  ---------  ------- 
At 1 January 2019                                             182         1,124       328        721    2,355 
-------------------------------------------------------  --------  ------------  --------  ---------  ------- 
 

14. SUBSIDIARIES

The subsidiaries of Xpediator Plc, all of which have been included in these combined financial statements, are as follows:

 
                                                                 Proportion of  Proportion of 
                                                                     ownership      ownership 
                                     Registered      Country of       interest       interest 
Name                                     Office   incorporation           2020           2019 
-----------------------------------  ----------  --------------  -------------  ------------- 
Delamode Holdings Ltd                         1  United Kingdom           100%           100% 
Delamode Distribution UK Ltd                  1  United Kingdom            51%            51% 
Delamode Plc                                  1  United Kingdom           100%           100% 
Delamode Property Ltd                         1  United Kingdom           100%           100% 
Xpediator Services Limited                    1  United Kingdom           100%           100% 
Easy Managed Transport Limited                1  United Kingdom           100%           100% 
Benfleet Forwarding Limited                   1  United Kingdom           100%           100% 
Regional Express Limited                      1  United Kingdom           100%           100% 
Import Services Limited                       1  United Kingdom           100%           100% 
Anglia Forwarding Group Limited               1  United Kingdom           100%           100% 
Anglia Forwarding Limited                     1  United Kingdom           100%           100% 
Traker International Limited                  1  United Kingdom           100%           100% 
Nidd Transport Limited                        1  United Kingdom           100%              - 
International Cargo Centre Limited            1  United Kingdom           100%            40% 
Affinity Transport Solutions Srl              2         Romania           100%           100% 
Delamode Moldova Srl                          3         Moldova           100%           100% 
Delamode Bulgaria OOD                         4        Bulgaria            90%            90% 
Delamode Balkans DOO                          5          Serbia           100%           100% 
Affinity Balkans DOO                          6      Montenegro           100%           100% 
Delamode Macedonia                            7       Macedonia           100%           100% 
Delamode Baltics UAB                          8       Lithuania            80%            80% 
Delamode Estonia OÜ                      9         Estonia            80%            80% 
Delamode Romania Srl                          2         Romania           100%           100% 
Affinity Leasing IFN                          2         Romania         99.95%         99.95% 
Delamode Group Limited                       10           Malta           100%           100% 
Delamode Group Holdings Limited              10           Malta           100%           100% 
Pallet Express Srl                           11         Romania           100%           100% 
Pallex Hungary                               12         Hungary           100%           100% 
Regional Express Gmbh                        13         Germany           100%           100% 
EshopWeDrop Limited                           1  United Kingdom              -           100% 
EshopweWeDrop.com Holdings                   10           Malta              -           100% 
EshopweWeDrop Baltics                         8       Lithuania              -           100% 
EshopweWeDrop Romania                         2         Romania              -           100% 
-----------------------------------  ----------  --------------  -------------  ------------- 
 

Delamode Group Holdings Limited, Easy Managed Transport Limited, Benfleet Forwarding Limited, Regional Express Limited, Import Services Limited, Anglia Group Forwarding Limited and Nidd Transport Limited are the only Subsidiaries held directly by Xpediator Plc.

   1       700 Avenue West, Skyline 120, Braintree, Essex, CM77 7AA, United Kingdom 
   2       Bd. Timisoara, nr 111-115 Sector 6, Bucharest, 061327, Romania 
   3       Bd. Moscova 21/5 of. 1011 MD-2068, Chisinau, Republic of Moldova 
   4       361 Tsarigradsko Shose Boulevard, 1582, Sofia, Bulgaria 
   5       Bulevar Oslobodenja 113, 11010 Vozdovac, Belgrade, Serbia 
   6       Dzordza, Vasingtona 51/43, Podgorica, 81000, Montenegro 
   7       Stefan Jakimov Dedov 14/1 1, 1000 Skopje, Macedonia 
   8       Eiguliu G, 2 03150, Vilnius, Lithuania 
   9       Parnu mnt. 139/C-1 11317, Tallinn, Estonia 
   10     Europa Business Centre, Level 3 - Suite 701, Dun Karn Street Birkirkara BKR 9034, Malta 
   11     Stefan cel Mare street, no. 193, Sibiu, 550321, Romania 
   12     1141 Budapest Szuglo utcs 82, Hungary 
   13     Darms tadter Landstrasse 116, Frankfurt, 60598, Germany 

On 1 January 2020, the Group obtained operational and management control of International Cargo Centre Limited and as a result this has been accounted for as a business Combination on 1 January 2020 under the definition of IFRS 3 "Business Combinations.

The following companies are entitled to exemption from audit under Section 479A of the UK Companies Act 2006 relating to subsidiary companies:

 
Company                              Registration 
-----------------------------------  ------------ 
Delamode Property Limited                06895332 
Traker International Limited             02068943 
International Cargo Centre Limited       02932640 
Xpediator Services Limited               09724594 
-----------------------------------  ------------ 
 

15. NON-CONTROLLING INTERESTS

Non-controlling interests ("NCI") held in the Group are as follows:

 
                                    2020   2019 
---------------------------------  -----  ----- 
Delamode Baltics UAB               20.0%  20.0% 
Delamode Estonia OÜ           20.0%  20.0% 
Delamode Bulgaria EOOD             10.0%  10.0% 
Affinity Leasing IFN               0.05%  0.05% 
Delamode Distribution UK Limited   49.0%  49.0% 
---------------------------------  -----  ----- 
 

The summarised financial information in relation to Delamode Bulgaria and Delamode Baltics before intra-Group eliminations, is presented below together with amounts attributable to NCI:

 
                     Delamode     Delamode 
                     Bulgaria  Baltics UAB 
                      GBP'000      GBP'000 
-------------------  --------  ----------- 
Share capital               1            6 
Reserves                  170          581 
-------------------  --------  ----------- 
Total NCI c/f 2019        171          587 
-------------------  --------  ----------- 
 
 
                                                                                   Delamode     Delamode 
                                                                                   Bulgaria  Baltics UAB 
                                                                                    GBP'000      GBP'000 
--------------------------------------------------------------------------------  ---------  ----------- 
Total NCI b/f 2020                                                                      171          587 
--------------------------------------------------------------------------------  ---------  ----------- 
Non-controlling interest in results for the year                                         96          695 
Non-controlling interest in dividends for the year                                    (117)        (377) 
Non-controlling interest in translation adjustment on opening reserves                    9            7 
Non-controlling interest in translation adjustment on results for the year                2           32 
--------------------------------------------------------------------------------  ---------  ----------- 
Total NCI c/f 2020                                                                      161          944 
--------------------------------------------------------------------------------  ---------  ----------- 
 
                                                               Delamode Bulgaria    Delamode Baltics UAB 
                                                                  2020      2019       2020         2019 
                                                               GBP'000   GBP'000    GBP'000      GBP'000 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Revenue                                                         26,276    22,467     65,685       56,735 
Cost of sales                                                 (23,215)  (19,801)   (56,208)     (49,718) 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Gross profit                                                     3,061     2,666      9,477        7,017 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Administrative expenses                                        (2,022)   (1,823)    (5,602)      (5,224) 
Other income                                                        46        25        173          105 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Operating profit                                                 1,085       868      4,048        1,898 
Finance costs                                                     (18)      (20)         48         (16) 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Profit before tax                                                1,067       848      4,096        1,882 
Tax expense                                                      (106)      (86)      (622)        (285) 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Profit after tax                                                   961       762      3,474        1,597 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Profit after tax attributable to non-controlling interests          96        76        695          319 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
 
                                                               Delamode Bulgaria    Delamode Baltics UAB 
                                                                  2020      2019       2020         2019 
For the period to 31 December 2020                             GBP'000   GBP'000    GBP'000      GBP'000 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Assets: 
Non-current trade and receivables                                   13        10        927          185 
Property plant and equipment                                       782       985        131           50 
Inventories                                                          9        10          -           42 
Trade and other debtors                                          4,932     4,706     11,657        8,977 
Cash and cash equivalents                                        1,156       904      2,336        1,632 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
                                                                 6,892     6,615     15,051       10,886 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Liabilities: 
Trade and other payables                                         5,282     3,990     10,329        7,952 
Loans and other borrowings                                           -       914          -            - 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
                                                                 5,282     4,904     10,329        7,952 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Total net assets                                                 1,610     1,711      4,722        2,934 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
Accumulated non-controlling interests                              161       171        944          587 
-----------------------------------------------------------  ---------  --------  ---------  ----------- 
 

The NCI of all the other shareholders, that are not 100% owned by the Group are considered to be immaterial.

16. INVESTMENTS

 
                                            Other   Associate       Total 
                                       Investment  Investment  Investment 
COST                                      GBP'000     GBP'000     GBP'000 
-------------------------------------  ----------  ----------  ---------- 
At 1 January 2020 & 31 December 2020            1           -           1 
-------------------------------------  ----------  ----------  ---------- 
 
 
                                 Other   Associate       Total 
                            Investment  Investment  Investment 
COST                           GBP'000     GBP'000     GBP'000 
--------------------------  ----------  ----------  ---------- 
At 1 January 2019                    1          60          61 
Performance of investment            -        (60)        (60) 
At 31 December 2019                  1           -           1 
--------------------------  ----------  ----------  ---------- 
NET BOOK VALUE 
At 31 December 2019                  1           -           1 
--------------------------  ----------  ----------  ---------- 
 

Investments represent investments in shares in unlisted companies.

International Cargo Centre Limited

On 1 January 2020, the Group obtained operational and management control of International Cargo Centre Limited and as a result this has been accounted for as a business Combination on 1 January 2020 under the definition of IFRS 3 "Business Combinations. The Group owned 40% of ICC, it was accounting as an associate investment until 31 December 2019.

17. TRADE AND OTHER RECEIVABLES

 
                                                         2020     2019 
Group                                                 GBP'000  GBP'000 
----------------------------------------------------  -------  ------- 
Current: 
Trade receivables                                      58,008   53,625 
Less: provision for impairment of trade receivables   (2,976)  (2,465) 
----------------------------------------------------  -------  ------- 
                                                       55,032   51,160 
----------------------------------------------------  -------  ------- 
Current financial assets                                3,624    2,689 
Prepayments and contract assets                         3,987    2,933 
Other receivables                                       4,080    4,145 
----------------------------------------------------  -------  ------- 
Total                                                  66,723   60,927 
----------------------------------------------------  -------  ------- 
Non-Current 
Trade and other receivables                               252    1,050 
----------------------------------------------------  -------  ------- 
 

Current financial assets relate to the security deposits held by DKV on behalf of the Group which are refundable on termination of the agreement which can be served giving three months' notice hence they are classed as current assets.

Included within trade debtors is a balance due from Simplu Romania of GBP92,000 (2019 - GBP232,000). This debt is guaranteed by the Directors of Delamode Holdings BV (which include Stephen Blyth and Shaun Godfrey), who are a related party to the Xpediator Group.

Included within other receivables due within one year is an amount due of GBP1,782,000 (2019 - GBP1,207,000) from the Vendors of Benfleet Forwarding Limited. In addition, there is a further GBPnil (2019 - GBP599,000) included in trade and other receivables due in more than one year.

Included within other receivables due within one year is an amount due of GBP48,000 (2019 - GBPnil) due from Inert Logistics LLP following the acquisition of the EshopWedrop Business. In addition, there is a further GBP252,000 (2019 - GBPnil) included in trade and other receivables due in more than one year.

The Group applies the IFRS 9 simplified approach to measuring expected credit losses using a lifetime expected credit loss provision for trade receivables and contract assets. To measure expected credit losses on a collective basis, trade receivables and contract assets are grouped based on similar credit risk and aging. The contract assets have similar risk characteristics to the trade receivables for similar types of contracts.

The expected loss rates are based on the Group's historical credit losses experienced. The historical loss rates are then adjusted to reflect current and forward-looking information, any known legal and specific economic factors, including the credit worthiness and ability of the customer to settle the receivable.

The movements in the impairment allowance for trade receivables are as follows:

 
                                                             2020     2019 
Group                                                     GBP'000  GBP'000 
--------------------------------------------------------  -------  ------- 
At 1 January                                                2,465    2,896 
Increase during the year                                      853    1,052 
Impairment losses reversed                                     20    (216) 
Receivable written off during the year as uncollectible     (362)  (1,267) 
--------------------------------------------------------  -------  ------- 
At 31 December                                              2,976    2,465 
--------------------------------------------------------  -------  ------- 
 

At 31 December 2020, the lifetime expected loss provision for trade receivables and contract assets is as follows:

 
                                 More than  More than  More than 
                                   30 Days    60 Days    90 Days 
                        Current   Past Due   Past Due   Past Due    Total 
                        GBP'000    GBP'000    GBP'000    GBP'000  GBP'000 
----------------------  -------  ---------  ---------  ---------  ------- 
Expected loss rate         0.8%       1.9%      10.5%      63.1% 
Gross carrying amount    52,220      2,576        714      3,833   59,343 
Loss provision              434         49         75      2,418    2,976 
----------------------  -------  ---------  ---------  ---------  ------- 
 

18. TRADE AND OTHER PAYABLES

 
                                     2020     2019 
Group                             GBP'000  GBP'000 
--------------------------------  -------  ------- 
Current: 
Trade and other payables           55,557   51,197 
Amounts owed to related parties        97       20 
Social security and other taxes     3,283    2,410 
Other creditors                     3,277    3,249 
Deferred Consideration                  -    4,607 
Accruals                            2,614    1,703 
--------------------------------  -------  ------- 
Total Trade and other payables     64,828   63,186 
--------------------------------  -------  ------- 
Non-current 
Trade and other payables              132      101 
--------------------------------  -------  ------- 
 

The deferred consideration of GBPnil (2019 - GBP4,607,000) due within one year relates to the deferred consideration on the acquisitions of Import Services Limited, Regional Express Limited and Anglia Forwarding Group Limited. Of this balance, GBPnil (2019 - GBPnil) is contingent on performance related criteria.

19. BANK AND OTHER LOANS

 
                                                      2020     2019 
Group                                              GBP'000  GBP'000 
-------------------------------------------------  -------  ------- 
Current: 
Bank loans                                             334      341 
Confidential invoice discounting facility            3,732    2,382 
-------------------------------------------------  -------  ------- 
                                                     4,066    2,723 
-------------------------------------------------  -------  ------- 
Non-current: 
Loans - 1-2 years                                      351      365 
Loans - 2-5 years                                    1,159    1,107 
Loans due after 5 years repayable by instalments       386      803 
-------------------------------------------------  -------  ------- 
                                                     1,896    2,275 
-------------------------------------------------  -------  ------- 
 

The Lloyds bank loan due after 5 years is due to be repaid by November 2026. Interest is being charged on this Lloyds bank loan at both a fixed rate of 6.4% and a variable rate of 1.1% above the Bank of England base rate.

The Lloyds bank loan is partially guaranteed by the personal assets of some of the Directors and Key Management of the Group. The book value and fair value of loans and borrowings are as follows:

 
                                                                                        2020     2019 
Non-Current                                                                          GBP'000  GBP'000 
-----------------------------------------------------------------------------------  -------  ------- 
Bank borrowings and others 
- Secured                                                                              1,896    2,275 
-----------------------------------------------------------------------------------  -------  ------- 
Current 
Bank borrowings and others 
- Secured                                                                              4,066    2,696 
- Unsecured                                                                                -       27 
-----------------------------------------------------------------------------------  -------  ------- 
                                                                                       4,066    2,723 
-----------------------------------------------------------------------------------  -------  ------- 
Total loans and borrowings                                                             5,962    4,998 
-----------------------------------------------------------------------------------  -------  ------- 
Sterling                                                                               5,962    4,971 
Other                                                                                      -       27 
-----------------------------------------------------------------------------------  -------  ------- 
Total                                                                                  5,962    4,998 
-----------------------------------------------------------------------------------  -------  ------- 
 
Bank borrowings and overdrafts are secured by a fixed and floating charge over the Group's 
 assets. 
 
The movements in the bank and other loans are as follows: 
 
                                                                                        2020     2019 
Group                                                                                GBP'000  GBP'000 
-----------------------------------------------------------------------------------  -------  ------- 
At 1 January                                                                           4,998    6,400 
New borrowings in the year                                                             1,350        - 
Change of accounting treatment of finance leases following the adoption of IFRS 16         -    (185) 
Borrowings repaid during the year                                                      (386)  (1,217) 
-----------------------------------------------------------------------------------  -------  ------- 
At 31 December                                                                         5,962    4,998 
-----------------------------------------------------------------------------------  -------  ------- 
 

20. PROVISIONS

Other provisions relate to an assessment of dilapidation of leasehold properties. In each instance, management have undertaken surveys to understand the work required to bring the leasehold properties back to their original condition. All of these provisions are due to be settled in more than one year.

 
                                                                   2020     2019 
                                                                GBP'000  GBP'000 
--------------------------------------------------------------  -------  ------- 
Balance at 1 January                                              1,674    1,523 
Additions during the year                                           402      151 
Additions acquired from acquisitions - Nidd Transport Limited        77        - 
--------------------------------------------------------------  -------  ------- 
Balance at 31 December                                            2,153    1,674 
--------------------------------------------------------------  -------  ------- 
 

21. FINANCIAL INSTRUMENTS - RISK MANAGEMENT

The Group is exposed through its operations to the following financial risks:

   --         Credit risk 
   --         Fair value or cash flow interest rate risk 
   --         Foreign exchange risk 
   --         Other market price risk, and 
   --         Liquidity risk. 

The Group is exposed to risks that arise from its use of financial instruments. This note describes the Group's objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

There have been no substantive changes in the Group's exposure to financial instrument risks, its objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.

Principal financial instruments

The principal financial instruments used by the Group, from which financial instrument risk arises, are as follows:

   --         Trad e receivables 
   --         Cash and cash equivalents 
   --         Trade and other payables 
   --         Bank overdrafts 
   --         Floating-rate bank loans 
   --         Fixed rate bank loans 
   --         Bank loan 
   --         Right of use assets and lease liabilities 

Financial instruments by category:

 
Financial assets at amortised costs 
                                               2020     2019 
                                            GBP'000  GBP'000 
------------------------------------------  -------  ------- 
Cash and cash equivalents                    12,720   11,951 
Trade and other receivables                  62,988   59,044 
------------------------------------------  -------  ------- 
Total financial assets at amortised costs    75,708   70,995 
------------------------------------------  -------  ------- 
 

Financial Liabilities

 
                                         Fair value through 
                                            profit and loss    Loans and other payables 
                                            2020       2019          2020          2019 
                                         GBP'000    GBP'000       GBP'000       GBP'000 
-------------------------------------  ---------  ---------  ------------  ------------ 
Trade and other payables                       -          -        61,677        56,270 
Bank loans and Invoice discounting             -          -         5,962         4,998 
Right-of-use asset lease liabilities           -          -        32,240        27,927 
Deferred consideration                         -        666             -         3,941 
-------------------------------------  ---------  ---------  ------------  ------------ 
Total financial liabilities                    -        666        99,879        93,136 
-------------------------------------  ---------  ---------  ------------  ------------ 
 

Financial instruments not measured at fair value

These include cash and cash equivalents, trade and other receivables, trade and other payables, and loans and borrowings. Due to their short-term nature, the carrying value of cash and cash equivalents, trade and other receivables, trade and other payables approximates their fair value.

The Group's activities expose it to a variety of financial risks: market risk (including foreign exchange risk, price risk and interest rate risk) credit risk and liquidity risk. The financial risks relate to the following financial instruments: cash and cash equivalents, trade and other receivables, trade and other payables, and loans and borrowings. The accounting policies with respect to these financial instruments are described above.

Risk management is carried out by the directors under policies, where they identify and evaluate financial risks in close co -- operation with the Group's operating units. The directors provide principles for overall risk management.

The reports on the risk management are produced periodically to the key management personnel of the Group.

(a) Credit Risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group is mainly exposed to credit risk from credit sales. It is Group policy, implemented locally, to assess the credit risk of new customers before entering contracts. Such credit ratings are taken into account by local business practices.

Credit risk also arises from cash and cash equivalents and deposits with banks and financial institutions. For banks and financial institutions, the most suitable bank in the local territory is selected.

A significant amount of cash is held with the following institutions:

 
                         2020*     2020     2019 
Cash at bank            Rating  GBP'000  GBP'000 
---------------------  -------  -------  ------- 
Barclays Bank plc         BBB+    1,881    2,528 
Lloyds Bank plc           BBB+    2,234      786 
Raiffeisen Bank AG          A-    3,969    4,110 
NatWest group plc          BBB      410      391 
Swedbank                    A+      939    1,344 
HSBC                        A-      619       56 
Bank of Transylvania        BB      193      470 
Unicredit Bulbank          BBB      431       60 
Hipotekarna Bank            NA        -      197 
Erste Bank                BBB+      182        - 
Luminor Bank AB             A+    1,142        - 
Other                               720      819 
------------------------------  -------  ------- 
Total                            12,720   10,761 
------------------------------  -------  ------- 
 
   *          Based on Standard & Poor Rating 
 
 
                                                                  2020     2020     2019 
Short term deposits                                             Rating  GBP'000  GBP'000 
-------------------------------------------------------------  -------  -------  ------- 
Lloyds Bank                                                       BBB+    1,757    1,190 
 
                                                                           2020     2019 
Reconciliation of cash in bank and deposits to balance sheet            GBP'000  GBP'000 
-------------------------------------------------------------  -------  -------  ------- 
Cash at bank                                                             10,963   10,761 
Short term deposits                                                       1,757    1,190 
----------------------------------------------------------------------  -------  ------- 
Total                                                                    12,720   11,951 
----------------------------------------------------------------------  -------  ------- 
 

(b) Market risk

(i) Price risk

Certain aspects of the commercial terms relating to the Affinity division are, directly linked to the commodity costs of fuel purchased by their clients at roadside fuelling stations across Europe. As such there is a risk arising from price changes relating to the fuel prices offered at the respective fuelling stations. In order to manage this risk the Group partially hedges the way it charges its commissions.

The table below shows the sensitivity analysis to possible changes in fuel prices to which the Group is exposed at the end of each year, with all other variables remaining constant. This arises due to the commercial arrangements the Affinity division has with its clients, whereby it will generate income in the form of commissions based on the value of fuel purchased by its clients.

 
                                                                  2020     2019 
Petrol price risk effect on net profit sensitivity analysis:   GBP'000  GBP'000 
-------------------------------------------------------------  -------  ------- 
Price increased by 10%                                             150      179 
Price decreased by 10%                                           (150)    (179) 
-------------------------------------------------------------  -------  ------- 
 

The Group is exposed to the market risk with respect to its operating income which is subject to changes in performance, exchange fluctuations and other market influences both economic and political. The directors manage this risk by reviewing on a regular basis market fluctuation arising on the Group's activities.

(ii) Cash flow and fair value interest rate risk

As the Group has no significant interest-bearing assets, its income and operating cash flows are substantially independent of changes in market interest rates.

The risk associated with interest-bearing debts is mitigated by utilising a mix of fixed and variable interest rate loans, as well as a Confidential Invoice Discounting Facility ("CID").

 
                                                                   2020     2019 
Interest rate risk effect on net profit sensitivity analysis:   GBP'000  GBP'000 
--------------------------------------------------------------  -------  ------- 
Interest rates increased by 0.25%                                  (15)     (13) 
Interest rates decreased by 0.25%                                    15       13 
--------------------------------------------------------------  -------  ------- 
 
 

The Group's cash flow and fair value interest rate risk is periodically monitored by the directors. The cash flow and fair value risk policy is approved by the directors.

Receivables and trade and other payables are interest free and have settlement dates within one year.

A sensitivity analysis is normally based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and change in some of the assumptions may be correlated - for example, change in exchange rates and change in market values.

(iii) Foreign exchange risk

Foreign exchange risk arises because the Group has operations located in various parts of the world whose functional currency is not the same as the presentational currency of the Group. Foreign exchange risk also arises when individual companies enter into transactions denominated in a currency other than their functional currency. Certain assets of the Group comprise amounts denominated in foreign currencies. Similarly, the Group has financial liabilities denominated in foreign currency. In general, the Group seeks to maintain the financial assets and financial liabilities in each of the foreign currencies at a reasonably comparable level, thereby providing a natural hedge against foreign exchange risk.

 
                                                       MLD      BGN      RSD      HUF      MKD 
                            GBP     Euro      RON      LEU      LEV    Dinar  Forints    Denar    Total 
                        GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000 
----------------------  -------  -------  -------  -------  -------  -------  -------  -------  ------- 
At 31 December 
 2020 
Financial assets         25,057   36,010    7,136      122    5,571    1,618        2      192   75,708 
Financial liabilities    43,448   45,687    4,071       35    4,909    1,602        1      126   99,879 
At 31 December 
 2019 
Financial assets         22,799   33,989    7,288       73    5,325    1,348        2      171   70,995 
Financial liabilities    42,247   40,801    3,853       26    4,635    1,409        -      165   93,136 
----------------------  -------  -------  -------  -------  -------  -------  -------  -------  ------- 
 

An analysis of the Group's exposure to foreign exchange risk, illustrating the impact on the net financial assets of a 10% movement in each of the key currencies to which the Group is exposed, is shown below

 
                                                  2020      2019 
Foreign currency risk sensitivity analysis:    GBP'000   GBP'000 
--------------------------------------------  --------  -------- 
Euro 
Strengthened by 10%                              (968)        22 
Weakened by 10%                                    968      (22) 
Romanian Lei 
Strengthened by 10%                                307       344 
Weakened by 10%                                  (307)     (344) 
Moldavian Leu 
Strengthened by 10%                                  9         5 
Weakened by 10%                                    (9)       (5) 
Serbian Dinar 
Strengthened by 10%                                  2       (6) 
Weakened by 10%                                    (2)         6 
Bulgarian Lev 
Strengthened by 10%                                 66       157 
Weakened by 10%                                   (66)     (157) 
Macedonian Denar 
Strengthened by 10%                                  7         1 
Weakened by 10%                                    (7)       (1) 
--------------------------------------------  --------  -------- 
 

(c) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash flow for operations. The Group manages its' risk to shortage of funds by monitoring forecast and actual cash flows.

The Group monitors its risk to a shortage of funds using a recurring liquidity planning tool. This tool considers the maturity of both its financial investments and financial assets (e.g. accounts receivables, other financial assets) and projected cash flows from operations.

 
                                              Between  Between 
                                       Up to  1 and 2  2 and 5     Over 
                                   12 months    years    years  5 years 
At 31 December 2020                  GBP'000  GBP'000  GBP'000  GBP'000 
---------------------------------  ---------  -------  -------  ------- 
Trade and other payables              61,545      132        -        - 
Bank loans & invoice discounting       4,066      351    1,159      386 
Lease liabilities                      8,344    7,717   14,113    7,357 
---------------------------------  ---------  -------  -------  ------- 
Total                                 73,995    8,200   15,272    7,743 
---------------------------------  ---------  -------  -------  ------- 
 
 
                                              Between  Between 
                                       Up to  1 and 2  2 and 5     Over 
                                   12 months    years    years  5 years 
At 31 December 2019                  GBP'000  GBP'000  GBP'000  GBP'000 
---------------------------------  ---------  -------  -------  ------- 
Trade and other payables              56,270        -        -        - 
Bank loans & invoice discounting       2,723      365    1,107      803 
Lease liabilities                      7,050    6,246   13,417    3,702 
Deferred consideration                 4,607        -        -        - 
---------------------------------  ---------  -------  -------  ------- 
Total                                 70,650    6,611   14,524    4,505 
---------------------------------  ---------  -------  -------  ------- 
 

22. CALLED UP SHARE CAPITAL

 
                                                2020     2020         2019     2019 
Ordinary Shares of GBP0.05 each               Number  GBP'000       Number  GBP'000 
---------------------------------------  -----------  -------  -----------  ------- 
At the beginning of the year             136,084,224    6,804  133,713,604    6,686 
Issued during the year                     5,548,951      278    2,370,620      118 
---------------------------------------  -----------  -------  -----------  ------- 
At the end of the year                   141,633,175    7,082  136,084,224    6,804 
---------------------------------------  -----------  -------  -----------  ------- 
50,000 deferred shares of GBP1.00 each        50,000       50       50,000       50 
---------------------------------------  -----------  -------  -----------  ------- 
At the end of the year                   141,683,175    7,132  136,134,224    6,854 
---------------------------------------  -----------  -------  -----------  ------- 
 
 

Shares Issued

On 30 June 2020, the Company issued 5,548,951 shares as part of a scrip dividend. The Scrip Dividend reference price of GBP0.2575 was calculated as the average of the Company's closing middle market price, as derived from the London Stock Exchange's Daily Official List, for the five consecutive business days commencing from the first day the ordinary shares are quoted as trading ex-dividend, being 12 June 2020.

On 16 May 2019, the Company issued 1,655,876 shares to the former owners of Easy Managed Transport Limited ("EMT") as part of the payment of the deferred consideration relating to the acquisition of the entire equity of EMT in 2017. The total value of this transaction was GBP831,250 which was settled by the issuance of new shares.

In 22 May 2019 Alex Borrelli and Geoff Gillo exercised their share options. As a result of exercising these options, the Company issued shares of 416,667 to Alex Borrelli and shares of 208,333 to Geoff Gillo at an option price of GBP0.24 per share. The market value of the shares issued to Alex Borrelli when exercised was GBP210,000, resulting in a gain of GBP110,000. The market value of shares issued to Geoff Gillo when exercised was GBP105,000, resulting in a gain of GBP55,000.

On 5 December 2019, the Company issued 89,744 new ordinary shares of GBP0.05 each as part of the agreed deferred consideration for the acquisition of Regional Express Limited. The total value of this transaction was GBP35,000 which was settled by the issuance of the new shares.

23. RESERVE DESCRIPTION AND PURPOSE

Retained earnings: All other net gains and losses and transactions with owners (e.g. dividends) not recognised elsewhere.

Translation reserve: represents the difference arising on the translation of the net assets and results of subsidiaries into the presentation currency.

Merger Reserves: represents the difference between the nominal value of consideration paid for shares acquired in entities under common control and the nominal value of those shares. This arises as a result of the business combination falling outside the scope of IFRS 3 and merger accounting being applied in place of acquisition accounting. In addition, the premium on the fair value in excess of the nominal value of shares issued in consideration of business combinations is credited to the merger reserve.

Share premium is the amount subscribed for share capital in excess of nominal value.

Equity reserve represents the cost of the share options granted that have not yet been exercised.

24. SHARE-BASED PAYMENTS

The Company has granted Directors' and key management share option plans. These are unapproved schemes so they do not satisfy the requirements of schedule 4, ITEPA. A summary of the options plans is shown below. All options will vest between 1 to less than 4 years.

 
                                         Share Option  Option Price 
Name                                               No           GBP  Vesting Period    Expiry Date 
---------------------------------------  ------------  ------------  --------------  ------------- 
SP Angel                                       55,250          0.24       July 2022    August 2022 
Stephen Blyth - Tranche 1 - now lapsed        214,286          0.70   November 2018  December 2021 
Stephen Blyth - Tranche 2 - now lapsed        214,286          0.70        May 2019  December 2021 
Stephen Blyth - Tranche 3 - not earned        214,286          0.70        May 2020  December 2021 
Stephen Blyth - Tranche 4 - now lapsed        214,285          0.70        May 2021  December 2021 
---------------------------------------  ------------  ------------  --------------  ------------- 
 
   1         Tranche 1 - Options can be exercised from 27 November 2018 
   2          Tranche 2 - Options can be exercised immediately following the Company's AGM in 2019. 
   3          Tranche 3 - Options are no longer exercisable as the performance criteria were not met. 
   4          Tranche 4 - Options can be exercised immediately following the Company's AGM in 2021. 

On 26 November 2018, the Company granted options over 857,143 Ordinary Shares (Stephen Blyth) and 642,857 Ordinary shares (Stuart Howard). These were split into four equal tranches. On 5 June 2020, tranche 1, tranche 2 and tranche 4 share options lapsed following the retirement of Stephen Blyth as Chief Executive Officer. Tranche 3 had lapsed at 31 December 2019 as the criteria had not been fulfilled. On 6 September 2019, Stuart Howard left the business, and as a result all unvested shares options were forfeited.

On 11 August 2017, the Company has granted share options to the non-executive directors over 416,667 Ordinary Shares (Alex Borrelli) and 208,333 Ordinary Shares (Geoff Gillo). The options may only be exercised in whole and not part and exercise of the options are conditional on the earnings per share of the Company in each of the two years ending 31 December 2017 and 31 December 2018 increasing by 10 per cent. or more on the previous year. For Alex Borrelli, the options are also conditional on him being a director of the Company on the date that the consolidated audited accounts of the Company for the year ending 31 December 2018 are published and for Geoff Gillo, for being a non-executive director of the Company on such date. The exercise price of the options is the Placing Price. (GBP0.24). These were exercised on 22 May 2019.

The Company has also granted to SP Angel warrants to subscribe for 55,250 Ordinary Shares at the Placing Price, GBP0.24, exercisable at any time during the period of five years from Admission.

Options will normally lapse on cessation of employment. However, exercise is permitted for a limited period following cessation of employment for specified reasons, such as redundancy, retirement, ill-health, and, in other circumstances, at the discretion of the Remuneration Committee.

The movements in share options are as follows:

 
                                               2020        2019 
                                                 No          No 
----------------------------------------  ---------  ---------- 
At 1 January                                698,107   2,180,250 
Share options exercised during the year           -   (625,000) 
Share options lapsed during the year      (642,857)   (857,143) 
At 31 December                               55,250     698,107 
Weighted average share price of options     GBP0.24     GBP0.66 
Weighted average grant fair value           GBP0.04     GBP0.04 
Weighted average contractual life         20 months    4 Months 
Exercise price                              GBP0.24  GBP0.24 to 
                                                        GBP0.70 
----------------------------------------  ---------  ---------- 
 

The weighted average grant fair value at the year was 2020 GBP0.04 (2019 - GBP0.04) per option. The outstanding options have a weighted average contractual life of 20 months (2019 - 4 months), and exercise price between GBP0.24 (2019 - GBP0.24 and GBP0.70).

Options were valued using the Black-Scholes option pricing model. No performance conditions were included in the fair value calculations. Expected dividends are not incorporated into the fair value calculations. The fair value per option granted and the assumptions used in the calculations are as follows;

 
                            2020       2019 
---------------------  ---------  --------- 
Risk free investment       1.97%      1.39% 
Expected life          20 Months  24 Months 
Expected volatility       43.63%     54.20% 
---------------------  ---------  --------- 
 

The Group recognised a total credit of GBP15,000 (2019 - charge of GBP11,000) relating to equity-settled share-based payments.

25. LEASES

The Group as a lessee

The Group's leases consist primarily of property premises and equipment and is presented below:

Right-of-use assets

 
                                     Property 
                                     Premises  Equipment    Total 
                                      GBP'000    GBP'000  GBP'000 
-----------------------------------  --------  ---------  ------- 
Cost 
At 1 January 2020                      32,143      1,197   33,340 
Additions during the year               8,678        678    9,356 
Additions acquired with subsidiary        252        396      648 
Disposals                               (316)       (24)    (340) 
Translation                               621          -      621 
-----------------------------------  --------  ---------  ------- 
At 31 December 2020                    41,378      2,247   43,625 
-----------------------------------  --------  ---------  ------- 
Depreciation 
-----------------------------------  --------  ---------  ------- 
At 1 January 2020                       5,623        332    5,955 
Charge for the year                     5,767        486    6,253 
Eliminated on disposal                  (244)       (20)    (264) 
Revaluations                               77          5       82 
-----------------------------------  --------  ---------  ------- 
At 31 December 2020                    11,223        803   12,026 
-----------------------------------  --------  ---------  ------- 
NET BOOK VALUE 
At 31 December 2020                    30,155      1,444   31,599 
-----------------------------------  --------  ---------  ------- 
At 31 December 2019                    26,520        865   27,385 
-----------------------------------  --------  ---------  ------- 
 
 

Lease liabilities included in the consolidated statement of financial position

 
                 2020     2019 
              GBP'000  GBP'000 
------------  -------  ------- 
Current         6,864    6,392 
Non-Current    25,376   21,535 
------------  -------  ------- 
Total          32,240   27,927 
------------  -------  ------- 
 

Amount recognised in the consolidated income statement

 
                                                       2020     2019 
                                                    GBP'000  GBP'000 
--------------------------------------------------  -------  ------- 
Depreciation on right-of-use property premises        6,459    5,623 
Depreciation charged on other right-of-use assets       486      332 
Interest on lease liabilities                         1,000    1,009 
--------------------------------------------------  -------  ------- 
Total                                                 7,945    6,964 
--------------------------------------------------  -------  ------- 
 

The total cash outflow for leases during the current year was GBP7,587,000 (2019 - GBP6,546,000), including GBP624,000 (2019 - GBP591,000) of interest.

26. RELATED PARTY TRANSACTIONS

Delamode Holding BV, is indirectly owned by Shaun Godfrey, Sandu Grigore, and Cogels Investments Limited all of whom are shareholders of Xpediator Plc.

Delamode Properitati Srl, a Company owned by Delamode Holding BV, is the landlord of one of the Group's leasehold properties in Romania. Rent payable under the current lease is at market rates. Shaun Godfrey, Sandu Grigore and Cogels Investment Limited are shareholders of Xpediator Plc.

During the year Group companies entered into the following transactions with related parties who are not members of the Group.

 
                                                                   Amounts owed      Amounts owed 
                                      Sales         Purchases                by                to 
                              2020     2019     2020     2019     2020     2019     2020     2019 
                           GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000 
-------------------------  -------  -------  -------  -------  -------  -------  -------  ------- 
Related Party 
Delamode Holding BV              -        -        -        -        -      117        -        - 
Delamode Propretati, 
 Srl                             3        3       99      271        1        4        9       80 
Companies in which directors or their immediate family have a significant 
 controlling interest 
Affinity Group Limited           -        -        -        -        -        -        -        4 
Borrelli Capital Limited         -        -       13        2        -        -        -        - 
-------------------------  -------  -------  -------  -------  -------  -------  -------  ------- 
 

The maximum amount owed by the Group to Companies in which directors or their immediate family have a significant controlling interest during the year was as follows :

 
                                  2020     2019 
                               GBP'000  GBP'000 
-----------------------        -------  ------- 
Affinity Group Limited               4        4 
COGELs Investment Ltd                -      237 
Richard Myson                        -        1 
-----------------------------  -------  ------- 
 

Details of directors' remuneration and the remuneration of key management personnel are given in note 6.

At 31 December 2020, bonus payables to Robert Ross of GBP128,000 were accrued within these financial statements.

The Group has entered into an agreement with Cogels Consultancy Limited to identify potential new acquisition targets. As a result, Cogels Consultancy Limited will be paid a 1% fee for any successful targets that they introduce. This is subject to a minimum payment of GBP50,000 and a maximum payment of GBP150,000.

All related party transactions were made at an arm's length basis.

Delamode (SW) Limited

On the 1 June 2018, Delamode Holdings Limited entered into a franchise agreement with Delamode (SW) Limited ("DSW"), with Shaun Godfrey acting as a Director for both Companies. The Group provides certain administrative functions on behalf of DSW and charges a fee at an agreed rate and under the franchise agreement is entitled to a share of the profits. Included within the consolidated income statement is a management fee for the administrative functions and profit share of from DSW of GBP79,708 (2019 - GBP48,000).

At 31 December 2020, the amounts due from DSW was GBP31,480 (2019 - GBP9,000).

27. EXCEPTIONAL ITEMS

During the year, the Group incurred non-recurring costs totalling GBP1,377,000 (2019 - GBP856,000).

An analysis by type of expense is show below.

 
                                                                             2020     2019 
                                                                          GBP'000  GBP'000 
------------------------------------------------------------------------  -------  ------- 
Redundancy and restructuring                                                1,625        - 
Acquisition Costs - Nidd Transport Limited                                    215        - 
Acquisition Costs - International Cargo Centre Limited                         17        - 
Aborted Acquisition Costs                                                      14      190 
Closure of EshopweWeDrop and Buzzbrand business                               298        - 
Disposal of Goodwill UK Buy/EshopWedrop business                              227        - 
Intangible Asset write-off UK Buy/EshopWedrop business                        112        - 
Anglia Forwarding Group Limited Contingent Consideration                    (344)      451 
Additional Deferred Contingent Consideration - Regional Express Limited         -      215 
Exceptional Profit on Disposal of Property in Ripon                         (787)        - 
------------------------------------------------------------------------  -------  ------- 
Total                                                                       1,377      856 
------------------------------------------------------------------------  -------  ------- 
 

On 31 December 2020, the Group announced that it would sell it's EshopWeDrop ("ESWD") business to Inert Logistics LLP. ESWD recorded a net loss of GBP(231,000) during the year. In addition there were asset write-offs of GBP(339,000) relating to the disposal of goodwill and the remaining net book value of the customer intangible, following the acquisition from Gerviva UAB on 6 January 2017. The total consideration payable is GBP300,000 in cash and is to be paid in monthly instalments over the next three years.

During May 2020, the Directors closed the Buzzbrand business. Buzzbrand recorded a loss of GBP(67,000) during the year.

Neither the closure of the ESWD or Buzzbrand business have been treated as a discontinued operation.

On 5 October 2020, following the acquisition of Nidd Transport Limited ("Nidd"), the Group immediately sold the property at Ripon and performed a sale and lease back. This generated a profit on disposal of GBP787,000, and resulted in the Group realising the revaluation reserve of GBP1,200,000. There was no tax charge arising from this disposal. At the same time the Group, entered into a right-of-use asset agreement for 15 years.

 
                                         GBP'000 
---------------------------------------  ------- 
Cash consideration received                2,900 
Less net book value of assets disposed   (2,100) 
Transaction Costs                           (13) 
---------------------------------------  ------- 
Gain on disposal                             787 
---------------------------------------  ------- 
 

28. SUBSEQUENT EVENTS

On 5 February 2021, Xpediator PLC granted options over 3,168,539 new ordinary shares to 108 employees under the Group Company Share Option Plan ("CSOP"). The award value is between GBP5,000 - GBP30,000 (depending on seniority within the business) divided by closing share price on the day before grant of CSOP options with an exercise price equivalent to 110% of the closing share price on the day before grant. These options vest three years from the award date and are subject to meeting a performance criteria of an average earnings per share (EPS) growth of 10% per annum, from the 1st January 2021 to 31st December 2023.

On 1 March 2021, Michael (Mike) Williamson was appointed as a director.

On 3 March 2021, the Company granted an award over 2,163,281 ordinary shares to Robert Ross and 267,010 ordinary shares to Michael Williamson.

The performance conditions are split equally between adjusted earnings per share growth ("EPS") and compound annual total shareholder return ("TSR").

For both EPS growth and TSR, one quarter of the awards will vest once a compound annual growth rate (CAGR) in excess of 10% has been achieved and will only vest 100% once a compound annual growth rate of 25% has been achieved. Between 10% and 25% CAGR, the awards will vest pro rata.

Under the long-term incentive plan, the awards will vest in portions of one third on each of the third, fourth and fifth anniversaries of grant, subject to continued employment and the satisfaction of two performance conditions.

Both awards contain malus and clawback provisions.

29. NATURE OF LEASES

The Group leases a number of properties in the jurisdictions from which it operates. In some jurisdictions it is customary for lease contracts to provide for payments to increase each year by inflation or and in others to be reset periodically to market rental rates. In some jurisdiction's property leases the periodic rent is fixed over the lease term.

The Group also leases certain items of plant and equipment. In some contracts for services with distributors, those contracts contain a lease of vehicles. Leases of plant, equipment and vehicles comprise only fixed payments over the lease terms.

The percentages in the table below reflect the current proportions of lease payments that are either fixed or variable.

The sensitivity reflects the impact on the carrying amount of lease liabilities and right-of-use assets if there was an uplift of 5% on the reporting date to lease payments that are variable.

 
                                                       Lease     Fixed  Variable 
                                                    Contract  Payments  Payments  Sensitivity 
                                                      Number         %         %      GBP'000 
--------------------------------------------------  --------  --------  --------  ----------- 
Property leases with payments linked to inflation          3         -        3%          308 
Property leases with fixed payments                       22       19%         -            - 
Leases of plant & equipment                               43       38%         -            - 
Vehicle leases                                            46       40%         -            - 
--------------------------------------------------  --------  --------  --------  ----------- 
Total                                                    114       97%        3%          308 
--------------------------------------------------  --------  --------  --------  ----------- 
 

30. BUSINESS COMBINATIONS

International Cargo Centre Limited

On 1 January 2020, the Group obtained operational and management control of ICC and as a result this has been accounted for as a Business Combination on 1 January 2020 under the definition of IFRS 3 "Business Combinations".

Goodwill

When determining the revised goodwill arising on the acquisition the following calculations were used.

 
Purchase consideration                          GBP'000 
----------------------------------------------  ------- 
Total consideration                                   - 
----------------------------------------------  ------- 
Allocation of assets and liabilities acquired 
Other assets 
Inventories                                           1 
Trade receivables                                   193 
Other receivables                                    82 
Cash                                                 24 
Property, Plant & Equipment                          27 
Liabilities 
Trade payables                                    (172) 
Other payables                                    (533) 
Deferred tax liability                              (9) 
----------------------------------------------  ------- 
Non-controlling interest                            232 
----------------------------------------------  ------- 
Goodwill                                            155 
----------------------------------------------  ------- 
 

The goodwill recognised will not be deductible for tax purposes.

On 30 April 2020, the Group acquired the remaining 60% of the issued share capital of International Cargo Centre (ICC) Limited, having acquired the original 40% on 4 June 2018.

Acquisition costs of GBP17,000 have been expensed to the income statement and are shown as part of the exceptional expenses.

As a result of the acquisition, GBP24,000 of net cash was acquired.

Since the acquisition, ICC has contributed GBP1,052,000 to Group revenue and a loss of GBP (145,000) to the Group.

Nidd Transport Limited

On 5 October 2020, the Group acquired 100% of the issued share capital of Nidd Transport Limited ("Nidd") a transport Company that specialises in daily express deliveries.

The principal reason for this acquisition was is that Nidd offers complimentary services but works in different geographical markets, with particular focus on France, Spain, Portugal and Germany. Nidd also offers a strong UK distribution platform, particularly in the North of England.

The total consideration payable comprised cash on completion of GBP4,600,000 and a 50% profit share adjustment from 1 May 2020 to 5 October 2020 of GBP116,000.

Fair Value assessment

As part of the fair value assessment of the Intangible assets of Nidd, a Customer related intangible asset was identified. The fair value calculation of customer related intangible asset was determined by using the income approach based on the expected future cash flows. This was then discounted to determine the present value. The weighted average cost of capital used in determining the present value, was 14.0%, which reflected the business and market risks factors. The outcome of the fair value calculation was to derive a customer related intangible asset with a value of GBP424,000.

Economic useful life

When determining the economic useful life of the customer relationships the historical length of relationships with existing customers and those reported by listed companies in the sector was considered as well as an annual attrition rate of 10.0%. Based on these factors, it was concluded that the useful economic life for customer relationships in relation to Nidd would be up to 10 years.

Deferred tax

As a result of the creation of these intangible assets, there is a deferred tax liability, which was calculated as the sum of the fair values of the intangible assets multiplied by the tax rate. An average long-term tax rate of 19.0% was used as to determine this. This resulted in a deferred tax liability of GBP81,000.

Goodwill

When determining the revised goodwill arising on the acquisition the following calculations were used.

 
Purchase consideration                          GBP'000 
----------------------------------------------  ------- 
Initial consideration - cash paid                 4,600 
Net working capital adjustment                      116 
----------------------------------------------  ------- 
Total consideration                               4,716 
----------------------------------------------  ------- 
Allocation of assets and liabilities acquired 
Intangible assets 
Customer-related intangible assets                  424 
Other assets 
Trade receivables                                 2,861 
Cash                                                926 
Fixed assets                                      2,303 
Right-of-use Assets                                 648 
Liabilities 
Trade payables                                    (995) 
Other payables                                    (963) 
Right-of-use liabilities                          (396) 
Provisions                                         (77) 
Deferred tax liability for intangible assets       (81) 
----------------------------------------------  ------- 
Goodwill                                             66 
----------------------------------------------  ------- 
 

The goodwill recognised will not be deductible for tax purposes.

Acquisition costs of GBP215,000 have been expensed to the income statement and are shown as part of the exceptional expenses.

As a result of the acquisition, GBP926,000 of net cash was acquired.

Since the acquisition, Nidd has contributed GBP2,491,000 to Group revenue and a profit of GBP873,000 to the Group. Of this profit, GBP800,000 relates to the sale and lease back of the Ripon property, which has been disclosed as an exceptional cost.

Had Nidd been part of the Group for the full year, it would have contributed full year revenue of GBP6,778,000 and full year profit before tax of GBP1,139,000. Of this profit, GBP800,000 relates to the sale and lease back of the Ripon property, which has been disclosed as an exceptional cost.

31. ANALYSIS OF CHANGES IN NET DEBT

 
                                                                              Non-cash 
                                                                              interest 
                           At 31                      Right-of-  Right-of-      charge      Other     At 31 
                        December             Foreign  Use-asset  use asset   right-of-   non-cash  December 
                            2019  Cashflow  exchange  additions  disposals  use assets  movements      2020 
Group                    GBP'000   GBP'000   GBP'000    GBP'000    GBP'000     GBP'000    GBP'000   GBP'000 
----------------------  --------  --------  --------  ---------  ---------  ----------  ---------  -------- 
Cash at bank              10,761     (449)       651          -          -           -          -    10,963 
Short term deposits        1,190       567         -          -          -           -          -     1,757 
----------------------  --------  --------  --------  ---------  ---------  ----------  ---------  -------- 
Total Cash                11,951       118       651          -          -           -          -    12,720 
----------------------  --------  --------  --------  ---------  ---------  ----------  ---------  -------- 
Confidential invoice 
 discounting facility      2,382     1,350         -          -          -           -          -     3,732 
Bank loans                 2,616     (386)         -          -          -           -          -     2,230 
Right-of-use-assets       27,927   (7,587)     1,063      9,752       (76)       1,000        161    32,240 
----------------------  --------  --------  --------  ---------  ---------  ----------  ---------  -------- 
Total debt                32,925   (6,623)     1,063      9,752       (76)       1,000        161    38,202 
----------------------  --------  --------  --------  ---------  ---------  ----------  ---------  -------- 
Net cash/(debt)         (20,974)                                                                   (25,482) 
Net cash excluding 
 right-of-use assets       6,953                                                                      6,758 
 
 
                                                                             Non-cash 
                                                                             interest 
                           At 31                                Right-of-      charge      Other     At 31 
                        December             Foreign   IFRS 16  use asset   right-of-   non-cash  December 
                            2018  Cashflow  exchange  adoption  additions  use assets  movements      2019 
Group                    GBP'000   GBP'000   GBP'000   GBP'000    GBP'000     GBP'000    GBP'000   GBP'000 
----------------------  --------  --------  --------  --------  ---------  ----------  ---------  -------- 
Cash at bank               8,449     2,882     (570)         -          -           -          -    10,761 
Short term deposits        1,198       (8)         -         -          -           -          -     1,190 
----------------------  --------  --------  --------  --------  ---------  ----------  ---------  -------- 
Total Cash                 9,647     2,874     (570)         -          -           -          -    11,951 
----------------------  --------  --------  --------  --------  ---------  ----------  ---------  -------- 
Finance lease 
 balances                    185         -         -         -          -           -      (185)         - 
Confidential invoice 
 discounting facility      3,024     (642)         -         -          -           -          -     2,382 
Bank loans                 3,191     (575)         -         -          -           -          -     2,616 
Right-of-use-assets            -   (6,546)         -    31,109      2,316       1,009         39    27,927 
----------------------  --------  --------  --------  --------  ---------  ----------  ---------  -------- 
Total debt                 6,400   (7,763)         -    31,109      2,316       1,009      (146)    32,925 
----------------------  --------  --------  --------  --------  ---------  ----------  ---------  -------- 
Net cash/(debt)            3,247         -         -         -          -           -          -  (20,974) 
Net cash excluding 
 right-of-use assets       3,247         -         -         -          -           -          -     6,953 
 

Reconciliation of net cash flow to movement in net debt

 
                                                          2020      2019 
                                                       GBP'000   GBP'000 
----------------------------------------------------  --------  -------- 
Net increase in cash and cash equivalents                  118     2,874 
Net increase in borrowings and right-of-use assets     (6,340)  (26,525) 
Foreign exchange movements                               1,714     (570) 
(Increase)/decrease in net debt                        (4,508)  (24,221) 
Opening net (debt) /cash                              (20,974)     3,247 
Closing net debt                                      (25,482)  (20,974) 
 
 

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END

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April 12, 2021 02:00 ET (06:00 GMT)

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