Interim Results

RNS Number : 5220M
Parity Group PLC
22 September 2021
 

PARITY GROUP PLC

INTERIM RESULTS FOR THE SIX MONTHS TO 30 JUNE 2021

 

22 September 2021

 

Parity Group plc ("Parity" or the "Group"), the data and technology focused professional services business, announces its half year results for the six months ended 30 June 2021 ("H1 2021").

Headlines

· Adjusted EBITDA for H1 2021 of £251k (H1 2020: £567k).

· Loss before tax of £491k (H1 2020: £383k) due primarily to one-off change management costs of £400k.

· New systems and processes resulted in a reduction of back-office costs by c.£250k.

· Pension scheme surplus of £1.3m (H1 2020: deficit of £0.5m).

· H1 2021 financial results impacted by lower revenue of £26m (H1 2020: £30m).

· External contribution of £2.3m (H1 2020: £2.9m).

·New management refocusing investment in front line resources in the Group's core recruitment services business since period end.

· The Board expects a return to growth and profitability in FY 2022.

 

Key Financials

For the six months ended 30 June 2021

 

 

Six months

to 30.06.21
(Unaudited)

£'000

Six months

to 30.06.20

(Unaudited)

£'000

Year

to 31.12.20

(Audited)

  £'000

Revenue

25,998

29,949

57,827

External contribution

2,322

2,863

5,561

Adjusted EBITDA1

251

567

1,056

Operating profit before non-underlying items

18

246

470

Adjusted (loss)/profit before tax1

(91)

61

122

Loss before tax

(491)

(383)

(325)

Net (debt)/cash excluding lease liabilities

(1,112)

654

231

 

1 Adjusted EBITDA and adjusted profit/loss before tax are non-IFRS alternative performance measures, defined in Note 1 of the notes to the interim results.

 

 

 

 

 

Mark Braund, Executive Chairman of Parity Group plc, said:

"It has been a tough start to the year for Parity.  Whilst the increase in economic activity has helped to re-energise the recruitment industry, it has exposed the underinvestment in the Group's core recruitment business, which has inevitably impacted our financial results.

We have taken action to address the challenges within the business by refreshing our strategy and are investing in frontline resources to capitalise on our reputable brand name during a time of heightened market opportunity.

The response from colleagues has been tremendous; their enthusiasm and hard work has already helped us to focus the business and combined with strong demand in Parity's core markets, I believe we can re-establish growth and profitability in the medium term."

 

 

Contacts

 

 

Parity Group PLC

www.parity.net

Mark Braund, Executive Chairman

Mike Johns, CFO

+ 44 (0) 208 543 5353

 

 

finnCap Ltd (Nomad & Broker)

https://www.finncap.com/

Jonny Franklin-Adams / Simon Hicks / Fergus Sullivan

+44 (0) 20 7220 0500

 

This announcement contains certain statements that are or may be forward-looking with respect to the financial condition, results or operations and business of Parity Group plc. By their nature forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements. These factors include but are not limited to (i) adverse changes to the current outlook for the UK IT recruitment and solutions market, (ii) adverse changes in tax laws and regulations, (iii) the risks associated with the introduction of new products and services, (iv) pricing and product initiatives of competitors, (v) changes in technology or consumer demand, (vi) the termination or delay of key contracts and (vii) volatility in financial markets.

 

 

Overview

During H1 2021 Parity experienced an increase in both sentiment and activity in the key markets served by the Group. However, trading was impacted by underinvestment in the core recruitment solutions business and the inability to establish a sustainable and scalable consulting division.

A change in leadership has taken place during the period; Mark Braund was appointed Non-Executive Chairman 21 April 2021, and subsequently as interim Executive Chairman 9 June 2021.

The management team has since undertaken a review of the business and refined the strategy to focus on and reinvest in Parity's core business of recruitment solutions; targeting in-demand skills in the data and change management sectors of the market, where the Group has been developing a presence.

The sectors Parity is targeting remain resilient to the disruption in the wider economy and provide the business with the opportunity to capitalise on the investment it is making in people during H2 2021, leveraging its heritage to re-establish growth in a business with strong demand and in which Parity is considered a quality brand.

Alongside traditional contract recruitment, Parity aims to extend its value-added services, including managed services and statement of work, to new and existing clients, an area of growing significance as clients seek to mitigate the increasing complexity of compliance and administration of contract resources, an area where Parity has a strong reputation and is rebuilding capacity.

Parity expect the investment being made in frontline resources to have a positive impact in Q4 2021 and to drive growth and a return to profitability in 2022.

Financial review

H1 2021 has seen an increase in market activity and with the pandemic restrictions slowly easing during the period it has created both opportunity and risk for Parity. The increasing activity in the market has coincided with unplanned staff attrition and underinvestment in the core recruitment solutions business, thereby contributing to a decline in revenue for the period.

Last year (2020) was a year of continued transformation, which, during the height of the pandemic saw the Group streamline back-office functions and invest in new systems. This has reduced costs and increased the ability of the business to adapt to changing business conditions.

In 2020 the pandemic created uncertainty, and whilst Parity retained employees without furlough, it shrank resources and reduced costs materially. Although activity was depressed, the Group's primary public sector market remained stable; this helped the business to maximise its financial performance during 2020 despite a reduction in top line revenue.

Following management changes in June 2021 the Group has made the decision to focus on and reinvest in Parity's core business of recruitment solutions; targeting in-demand skills in the data and change management sectors of the market, where the Group has been developing a presence.

External contribution

During H1, optimism that the worst of the pandemic may be over has seen an 11% increase in job opportunities within contract recruitment compared with H2 2020 and many of our key clients seeking to add to or start new projects. In addition, as businesses started to hire new staff the number of permanent job opportunities rose dramatically in Q1 of 2021.

Despite the backdrop of increased activity in recruitment the Group has seen a decline in total external contribution for the period to £2.3m (H1 2020: £2.9m, FY 2020: £5.6m) with key service lines down.

Recruitment

As noted previously the decision by the business to preserve cash and limit risk during the height of the pandemic in 2020 was a key driver behind the lack of investment in frontline revenue generating resources. This combined with higher-than-expected staff turnover during H1 2021 has meant that the business has been under-resourced in client and contractor facing roles. The impact has been:

· A focus on maintaining and developing key clients, resulting in growth during the period from 3 of our top 5 clients.

· 17% of new job opportunities were not actively managed due to resourcing shortages.

·Less engagement with contractors and an increase in early terminations during the period (contracts ending before the contracted end date) by more than 40% compared with the H2 2020.

· Higher attrition in the long tail of clients (those with less than 5 active contractors).

· A lack of resource to actively manage permanent recruitment opportunities.

A clear plan of action has since been put in place to address these challenges, with some immediate improvements beginning to materialise.

Consulting and Managed Services

Managed services during the period has been in line with expectations but limited to core contracted services. Historically (before 2020) core managed services would have been supplemented by additional client projects. Having seen these disappear during the pandemic, H1 2021 has seen a revival of discussions on incremental statements of work but none of these projects have contributed to H1 2021.

Growing the consultancy pipeline and revenue had been a key objective for the business in H1 2021. Q1 provided a positive start with a small number of discrete projects, discussed with clients, and nurtured during the pandemic, being started during the period. The Group has been unable to productise its consulting propositions and as a consequence pipeline development has been slow. With long lead times and no significant projects closed in Q2 of H1 2021, revenue and external contribution fell short of our expectations.

Result before tax

Despite the lower external contribution in the period, the Group has delivered an adjusted EBITDA of £251k (H1 2020:  567k, FY 2020: £1,056k). Partially offsetting the fall in external contribution was a reduction in back-office costs by £250k (versus H1 2020). This was a direct result of the restructuring during 2020 of back-office functions, reducing headcount and implementing new systems and processes.

During the period the business incurred £400k of non-underlying costs, the majority of which relates to changes in management (H1 2020: £444k, FY 2020: £447k).

After the inclusion of non-underlying items, the Group posted a loss before tax for H1 2021 of £491k (H1 2020: £383k, FY 2020: £325k).

Cash & net debt

Net debt, excluding adjustments for IFRS 16 lease liabilities, as at 30 June 2021 was £1.11m (30 June 2020: net cash of £0.65m, 31 December 2020: net cash of £0.23m).

The Group continues to utilise part of its £9m debt facility secured against billed and unbilled receivables to manage both intra month and inter month movements in working capital. In April 2021 the Group transferred its ABL facility from PNC to Leumi ABL, giving it greater flexibility and lower borrowing costs. The new facility with Leumi ABL runs for an initial period of 3 years until April 2024.

During H1 2020 the Group maintained a significant headroom on the facility and as at 30 June 2021 the headroom on the facility was £2.1m.

Net debt has increased during H1 2021, the largest component of which is an increase in debtor days. Debtor days, which have been exceptionally low over the last 18 months have increased slightly during the period from 14 as at 30 December 2020 to 21 as at 30 June 2021. Despite the increase in debtor days conversion of income to cash remains strong and there have been no bad debts realised during the period.

Defined benefit pension

The final salary pension scheme surplus was £1.3m at 30 June 2021 (30 June 2020: deficit of £0.5m; 31 December 2020: surplus of £0.2m). The continuing growth in the surplus during the first half was primarily due to a positive performance from the scheme's growth assets.

During the period the Group made £161k of contributions to the pension scheme, this includes £72k of costs associated with the administration of the scheme.

Outlook

Although the Group has seen a further decline in revenue and external contribution, there is an expectation that in Parity's core areas of data, technology and change management, the increase in market activity will be sustained.  Parity is on a mission to rapidly rebuild capacity to deliver growth by positioning itself strategically to build long-term value.

Refocusing on the core recruitment solutions business has provided the Group with a clear and achievable goal.  The response from the team has been tremendous; their enthusiasm and hard work is already beginning to show through and with a much lower and more flexible cost base across all business functions, as confidence returns, we will add further scale.

With the existing debt line, flexible cost base, a strong set of core clients, a refocus on contract recruitment and further investment in front line resources being made in Q3 and Q4, along with a general rise in the market, the directors believe that the business is well placed to stabilise in H2 and be in a position to generate growth and return to profit in FY 2022.

 

 

 

 

Consolidated condensed income statement

For the six months ended 30 June 2021

 

 

 

 

 

 

Notes

Six months

to 30.06.21
(Unaudited)

£'000

Six months

to 30.06.20

(Unaudited)

£'000

Year

to 31.12.20

(Audited)

  £'000

Revenue

3

25,998

29,949

57,827

Contractor costs

 

(23,676)

(27,086)

(52,266)

External contribution

 

2,322

2,863

5,561

Operating costs before non-underlying items

 

(2,304)

(2,617)

(5,091)

Operating profit before non-underlying items

 

18

246

470

Non-underlying items

4

(400)

(444)

(447)

Operating (loss)/profit

 

(382)

(198)

23

Analysed as:

 

 

 

 

Adjusted EBITDA1

 

251

567

1,056

Depreciation and amortisation

 

(233)

(321)

(586)

Non-underlying items

4

(400)

(444)

(447)

Finance costs

5

(109)

(185)

(348)

Loss before tax

 

(491)

(383)

(325)

Analysed as:

 

 

 

 

Adjusted (loss)/profit before tax1

 

(91)

61

122

Non-underlying items

4

(400)

(444)

(447)

Tax (charge)/credit

6

(34)

95

(145)

Loss for the period attributable to owners of the parent

 

(525)

(288)

(470)

 

Loss per share

Basic

Diluted

 

7

7

(0.51p)

(0.51p)

(0.28p)

(0.28p)

(0.46p)

(0.46p)

 

 

All activities comprise continuing operations.

 

1 Adjusted EBITDA and adjusted profit/loss before tax are non-IFRS alternative performance measures, defined in Note 1 of the notes to the interim results.

 

 

Consolidated condensed statement of comprehensive income

For the six months ended 30 June 2021

 

 

 

Six months

to 30.06.21
(Unaudited)

£'000

Six months

to 30.06.20

(Unaudited)

£'000

Year

to 31.12.20

(Audited)

  £'000

Loss for the period

(525)

(288)

(470)

 

 

 

 

Other comprehensive income

 

 

 

Items that will never be reclassified to profit or loss

 

 

 

Remeasurement of defined benefit pension scheme

985

400

1,041

Deferred taxation on remeasurement of defined benefit pension scheme

(187)

(76)

(198)

Other comprehensive income for the period after tax

798

324

843

Total comprehensive income for the period attributable to owners of the parent

273

36

373

 

 

 

 

 

     

 

 

 

Consolidated condensed statement of changes in equity

For the six months ended 30 June 2021

 

Six months to 30.06.21 (Unaudited)

 

Share

capital

£'000

Share

premium

reserve

£'000

Capital redemption reserve

£'000

Other

reserves

£'000

Retained

earnings

£'000

Total

£'000

At 1 January 2021

2,053

33,244

14,319

34,560

(77,290)

6,886

Share options - value of employee services

-

-

-

-

(59)

(59)

Transactions with owners

-

-

-

-

(59)

(59)

Loss for the period

-

-

-

(525)

(525)

Other comprehensive income for the period

-

-

-

-

798

798

At 30 June 2021

2,053

33,244

14,319

34,560

(77,076)

7,100

 

Six months to 30.06.20 (Unaudited)

 

Share

capital

£'000

Share

premium

reserve

£'000

Capital redemption reserve

£'000

Other

reserves

£'000

Retained

earnings

£'000

Total

£'000

Revised at 1 January 2020

2,053

33,244

34,560

(77,753)

6,423

Share options - value of employee services

-

-

-

-

43

43

Transactions with owners

-

-

-

-

43

43

Loss for the period

-

-

-

(288)

(288)

Other comprehensive income for the period

-

-

-

-

324

324

At 30 June 2020

2,053

33,244

14,319

34,560

(77,674)

6,502

 

Year to 31.12.20 (Audited)

 

Share

capital

£'000

Share

premium

reserve

£'000

Capital redemption reserve

£'000

Other

reserves

£'000

Retained

earnings

£'000

Total

£'000

At 1 January 2020

2,053

33,244

14,319

34,560

(77,753)

6,423

Share options - value of employee services

-

-

-

-

90

90

Transactions with owners

-

-

-

-

90

90

Loss for the year

-

-

-

(470)

(470)

Other comprehensive income for the year

-

-

-

-

843

843

At 31 December 2020

2,053

33,244

14,319

34,560

(77,290)

6,886

 

 

Consolidated condensed statement of financial position

As at 30 June 2021

 

Notes

As at

30.06.21

(Unaudited)

£'000

As at

30.06.20

(Unaudited)

£'000

As at

31.12.20

(Audited)

£'000

Assets

Non-current assets

 

 

 

 

Goodwill

 

4,594

4,594

4,594

Other intangible assets

 

4

17

6

Property, plant and equipment

 

17

34

23

Right-of-use assets

 

76

387

247

Trade and other receivables

 

58

115

87

Deferred tax assets

 

405

990

627

Retirement benefit asset

8

1,280

-

208

Total non-current assets

 

6,434

6,137

5,792

Current assets

 

 

 

 

Trade and other receivables

 

7,733

5,603

6,062

Cash and cash equivalents

 

904

3,705

3,172

Total current assets

 

8,637

9,308

9,234

Total assets

 

15,071

15,445

15,026

Liabilities

 

 

 

 

Current liabilities

 

 

 

 

Loans and borrowings

 

(2,016)

(3,051)

(2,941)

Lease liabilities

 

(147)

(597)

(321)

Trade and other payables

 

(5,648)

(4,539)

(4,610)

Provisions

 

(40)

(122)

(139)

Total current liabilities

 

(7,851)

(8,309)

(8,011)

Non-current liabilities

 

 

 

 

Lease liabilities

 

(78)

(115)

(87)

Provisions

 

(42)

(22)

(42)

Retirement benefit liability

8

-

(497)

-

Total non-current liabilities

 

(120)

(634)

(129)

Total liabilities

 

(7,971)

(8,943)

(8,140)

Net assets

 

7,100

6,502

6,886

 

 

 

 

 

Shareholders' equity

 

 

 

 

Called up share capital

 

2,053

2,053

2,053

Share premium account

 

33,244

33,244

33,244

Capital redemption reserve

 

14,319

14,319

14,319

Other reserves

 

34,560

34,560

34,560

Retained earnings

 

(77,076)

(77,674)

(77,290)

Total shareholders' equity

 

7,100

6,502

6,886

 

Consolidated condensed statement of cash flows

For the six months ended 30 June 2021

 

 

 

 

 

 

Notes

Six months

to 30.06.21
(Unaudited)

£'000

Six months

to 30.06.20

(Unaudited)

£'000

Year

to 31.12.20

(Audited)

  £'000

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

Loss for the period

 

(525)

(288)

(470)

Adjustments for:

 

 

 

 

Net finance expense

5

109

185

348

Share-based payment expense

 

(59)

43

90

Income tax charge/(credit)

6

34

(95)

145

Amortisation of intangible assets

 

2

15

26

Depreciation of property, plant and equipment

 

6

9

20

Depreciation and impairment of right-to-use assets

 

225

300

540

Lease liability credit

 

-

(11)

(21)

 

 

(208)

158

678

Working capital movements

 

 

 

 

(Increase)/decrease in trade and other receivables

 

(1,642)

1,194

764

Increase/(decrease) in trade and other payables

 

1,038

(1,473)

(1,402)

Decrease in provisions

 

(99)

(201)

(165)

Payments to retirement benefit plan

8

(161)

(135)

(325)

Net cash flow used in operating activities

 

(1,072)

(457)

(450)

 

 

 

 

 

Investing activities

 

 

 

 

Net cash flow used in investing activities

 

-

-

-

 

 

 

 

 

Financing activities

 

 

 

 

(Repayment)/drawdown of finance facility

 

(925)

332

222

Principal repayment of lease liabilities

 

(238)

(249)

(649)

Interest paid

5

(33)

(37)

(67)

Net cash (used in)/from financing activities

 

(1,196)

46

(494)

 

 

 

 

 

Net decrease in cash and cash equivalents

 

(2,268)

(411)

(944)

Cash and cash equivalents at the beginning of the period

3,172

4,116

4,116

Cash and cash equivalents at the end of the period

904

3,705

3,172

 

 

 

 

 

 

 

Notes to the interim results

 

1  Accounting policies

 

Basis of preparation

The condensed interim financial statements comprise the unaudited results for the six months to 30 June 2021 and 30 June 2020 and the audited results for the year ended 31 December 2020. The financial information for the year ended 31 December 2020 herein does not constitute the full statutory accounts for that period. The 2020 Annual Report and Accounts have been filed with the Registrar of Companies. The Independent Auditor's Report on the Annual Report and Financial Statements for 2020 was unqualified and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.

 

The condensed financial statements for the period ended 30 June 2021 have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Services Authority and with IAS 34 'Interim Financial Reporting'. The information in these condensed financial statements does not include all the information and disclosures made in the annual financial statements.

 

The condensed financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) in a manner consistent with the accounting policies set out in the Group financial statements for the year ended 31 December 2020.

 

Going concern

The interim financial statements have been prepared on a going concern basis. The Directors have reviewed the Group's cash flow forecasts for the period to 31 December 2022, taking account of reasonably possible changes in trading performance, including potential downsides from the ongoing impact of Covid-19. Downside sensitivities have included reduced levels of new business and in these scenarios, headroom under the Group's financing facility meets the Group's funding requirements.

 

Financial instruments

Unless otherwise indicated, the carrying amounts of the Group's financial assets and liabilities are a reasonable approximation of their fair values.

 

Alternative performance measures

The Group uses certain alternative performance measures to report its results as stated before non-underlying items. These are non-IFRS alternative performance measures which the Directors consider can assist with an understanding of the underlying performance of the Group and comparison of performance across periods. They are not a substitute for and are not superior to any IFRS measure.

 

Non-underlying items

The presentation of the alternative performance measures of adjusted EBITDA and adjusted profit/loss before tax excludes non-underlying items. The Directors consider that an underlying profit measure can assist with an understanding of the underlying performance of the Group and comparison of performance across periods. Items are classified as non-underlying by nature of their magnitude, incidence or unpredictable nature and their separate identification results in a calculation of an underlying profit measure that is consistent with that reviewed by the Board in their monitoring of the performance of the Group. Events which may give rise to the classification of items as non-underlying include gains or losses on the disposal of a business, restructuring of a business, transaction costs, litigation and similar settlements, asset impairments and onerous contracts.

 

Adjusted profit/loss before tax is defined as profit/loss before tax and non-underlying items.

Adjusted EBITDA is defined as operating profit before finance costs, tax, depreciation, amortisation and non-underlying items.

 

Accounting policies: new standards, amendments and interpretations

At the date of authorisation of these interim financial statements, several new, but not yet effective, standards, amendments to existing standards and interpretations have been published. None of these have been adopted early by the Group. New standards, amendments and interpretations not adopted in the current year have not been disclosed as they are not expected to have a material impact on the Group.

 

2  Segmental information

 

The basis by which the Group is organised and its operating model is structured is by customer sectors, being the public sector and the private sector. The reporting of financial information presented to the Chief Operating Decision Maker, being the Group board of directors, is consistent with these reporting segments. As these reporting segments are supported by a combined back office, there is no allocation of overheads.

 

Six months to 30.06.21 (Unaudited)

 

Public sector

 

Private sector

 

Total

 

£'000

£'000

£'000

Revenue

18,700

7,298

25,998

Contractor costs

(17,034)

(6,642)

(23,676)

External contribution

1,666

656

2,322

 

Six months to 30.06.20 (Unaudited)

 

Public sector

 

Private sector

 

Total

 

£'000

£'000

£'000

Revenue

22,297

7,652

29,949

Contractor costs

(20,328)

(6,758)

(27,086)

External contribution

1,969

894

2,863

 

Year to 31.12.20 (Audited)

 

Public sector

 

Private sector

 

Total

 

£'000

£'000

£'000

Revenue

43,283

14,544

57,827

Contractor costs

(39,405)

(12,861)

(52,266)

External contribution

3,878

1,683

5,561

 

3  Revenue

 

The Group's revenue disaggregated by pattern of revenue recognition is as follows:

 

 

 

 

 

Six months to 30.06.21

(Unaudited)

£'000

Six months to 30.06.20

(Unaudited)

£'000

Year to 31.12.20

(Audited)

£'000

Services transferred over time

25,981

29,934

57,790

Services transferred at a point in time

17

15

37

Revenue

25,998

29,949

57,827

     

 

 

 

 

 

 

 

The Group's revenue disaggregated by primary geographical market is as follows:

 

 
 

 

 

 

 

Six months to 30.06.21

(Unaudited)

£'000

Six months to 30.06.20

(Unaudited)

£'000

Year to 31.12.20

(Audited)

£'000

United Kingdom

 

22,707

28,665

55,235

European Union

 

3,291

1,269

2,577

Other

 

-

15

15

Revenue

 

25,998

29,949

57,827

      

 

4  Non-underlying items

 

 

 

 

Six months to

30.06.21

(Unaudited)

£'000

Six months to

30.06.20

(Unaudited)

£'000

Year to
31.12.20

(Audited)

£'000

Restructuring

 

 

 

- Costs related to employees

366

352

370

- Costs related to premises

34

3

(11)

- Other costs

-

89

88

 

400

444

447

 

 

 

 

Items are classified as non-underlying by nature of their magnitude, incidence or unpredictable nature and their separate identification results in a calculation of an underlying profit measure that is consistent with that reviewed by the Board in their monitoring of the performance of the Group. In previous periods, the Group's results separately presented non-recurring items as a separate section of the income statement. The directors consider that all items classified as non-recurring in previous periods are non-underlying and have reclassified these costs as such.

 

Non-underlying items during 2021 include costs related to the restructuring of the Board, including director termination payments and fees for professional services, along with an impairment to a right-of-use asset as a result of early vacation of an office premises.

 

5  Finance costs

 

Six months to

30.06.21

(Unaudited)

£'000

Six months to

30.06.20

(Unaudited)

£'000

Year to
31.12.20

(Audited)

£'000

Interest expense on financial liabilities

33

37

67

Interest expense on lease liabilities

4

10

19

Interest income on lease assets

(2)

(2)

(4)

Net finance costs in respect of post-retirement benefits

74

140

266

 

109

185

348

 

The interest expense on financial liabilities represents interest paid on the Group's asset-based financing facilities.

 

 

 

 

 

 

6  Taxation

 

 

 

 

Six months to

30.06.21

(Unaudited)

£'000

Six months to

30.06.20

(Unaudited)

£'000

Year to
31.12.20

(Audited)

£'000

Recognised in the income statement

 

 

 

Current tax charge

-

-

-

Deferred tax charge/(credit)

34

(95)

145

Total tax charge/(credit)

34

(95)

145

 

 

 

 

Recognised in other comprehensive income

 

 

 

Deferred tax charge

187

76

198

 

7  Earnings per ordinary share

 

Basic earnings per share is calculated by dividing the basic earnings for the period by the weighted average number of fully paid ordinary shares in issue during the period.  Diluted earnings per share is calculated on the same basis as the basic earnings per share with a further adjustment to the weighted average number of fully paid ordinary shares to reflect the effect of all dilutive potential ordinary shares.

 

 

Six months to 30.06.21

(Unaudited)

Six months to 30.06.20

(Unaudited)

Year to 31.12.20

(Audited)

 

 

 

 

Loss

£'000

Weighted

average number of

shares

000's

 

 

Loss

per share

Pence

 

 

 

Loss

£'000

Weighted

average number of

shares

000's

 

 

Loss

per share

Pence

 

 

 

Loss

£'000

Weighted

average number of

shares

000's

 

 

Loss

per share

Pence

 

Basic loss per share

(525)

102,624

(0.51)

(288)

102,624

(0.28)

(470)

102,624

(0.46)

Effect of dilutive options

-

-

-

-

-

-

-

-

-

Diluted loss per share

(525)

102,624

(0.51)

(288)

102,624

(0.28)

(470)

102,624

(0.46)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As at 30 June 2021 the number of ordinary shares in issue was 102,624,020 (30 June 2020 and 31 December 2020: 102,624,020).

 

8  Pension commitments

 

The Group provides employee benefits under various arrangements, through defined benefit and defined contribution pension plans, the details of which are disclosed in the 2020 Annual Report and Accounts. At the interim balance sheet date, the major assumptions used in assessing the defined benefit pension scheme liability have been reviewed and updated based on a roll-forward of the last formal actuarial valuation, which was carried out as at April 2018.

 

The following estimates have been applied to the IAS 19 valuation:

 

 

30.06.21

30.06.20

31.12.20

Rate of increase in pensions in payment

3.7-4.0%

3.6-3.9%

3.6-3.9%

Discount rate

1.8%

1.5%

1.3%

Retail price inflation

3.4%

3.1%

3.2%

Consumer price inflation

2.4%

2.1%

2.2%

 

The surplus has increased by £1.1m since 31 December 2020. The improvement was partly due to a fall in the value of scheme liabilities and partly as a result of actions taken by the board and the Trustees to reduce scheme risk.

 

9  Related party transactions

 

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are therefore not disclosed.

 

There were no other related party transactions during the period (2020: none).

 

10  Events after the reporting period

 

There are no events after the reporting period not reflected in the interim financial statements.

 

 

 

 

 

 

 

 

Statement of directors' responsibilities

 

The directors confirm, to the best of their knowledge:

 

·      The condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting';

 

·      The interim management report includes a fair review of the information required by DTR 4.2.7R of the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the year, and gives a true and fair view of the assets, liabilities, financial position and profit for the period of the Group; and

 

·       The interim management report includes a fair review of the information required by DTR 4.2.8R of the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority, being a disclosure of related party transactions and changes therein since the previous annual report.

 

By order of the Board

 

 

 

Mark Braund

Executive Chairman

22 September 2021

 

 

 

 

 

 

 

 

 

 

 

 

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