Financial results for the year ended 30 June 2024
16 September 2024
Wilmington plc
Sustained double digit profits growth
Wilmington plc, (LSE: WIL, 'Wilmington' or 'the Group') the provider of data, information, education and training services in the global Governance, Risk and Compliance (GRC) markets, today announces its unaudited preliminary results for the year ended 30 June 2024. The results are unaudited because the auditors have requested extra time to complete their final audit procedures.
Financial performance
|
|
2024 |
2023 |
Change |
|
Ongoing results[1] |
|
|
|
|
Revenue |
£89.7m |
£78.7m |
14% |
|
Adjusted PBT[2] |
£24.1m |
£16.9m |
42% |
|
Adjusted PBT margin |
26.8% |
21.5% |
25% |
|
Adjusted basic EPS[3] |
19.81p |
14.02p |
41% |
|
|
|
|
|
|
Total results |
|
|
|
|
Net cash[4] |
£67.8m |
£42.2m |
61% |
|
Total dividend |
11.3p |
10.0p |
13% |
|
Total adjusted PBT |
£27.6m |
£24.3m |
13% |
|
Total adjusted PBT margin |
22% |
20% |
11% |
|
Total basic EPS |
46.32p |
22.94p |
102% |
|
Statutory continuing results |
|
|
|
|
Revenue |
£98.3m |
£93.1m |
6% |
|
PBT |
£24.2m |
£20.5m |
17% |
|
Basic EPS |
19.33p |
19.51p |
(1%) |
Highlights
· 14% revenue growth from ongoing businesses. Organic growth of 9%1. All ongoing businesses grew.
· Annual recurring revenues up 16%, now 36% (2023: 33%) of Group organic revenues, despite the sale of subscription-heavy businesses.
· Adjusted profit before tax from ongoing businesses up 42% to £24.1m (2023: £16.9m). Total adjusted profit before tax of £27.6m (2023: £24.3m).
· Total adjusted PBT margin up to 22% from 20%. Operating margins of ongoing businesses continue to increase.
· Dividend increased by 13% to final dividend of 11.3p.
· Robust balance sheet with net cash at 30 June 2024 £67.8m (2023: £42.2m) reflecting strong trading performance and cash conversion as well as the net cash received from portfolio changes.
· Continued to enhance and streamline portfolio with acquisition of Astutis, and disposals of European Healthcare & MiExact businesses.
· Investment in the development of single technology platform for the whole business.
Mark Milner, Chief Executive Officer, commented:
"We have delivered another strong year, in line with our strategy with notably strong increases in revenues, profits and cash generation. Margins have also continued to improve strongly.
"We continued to focus on consolidating our already strong presence in the large, growing and rapidly evolving international GRC markets and significantly enhanced our capabilities with the acquisition of Astutis in the Health, Safety and Environment (HSE) sector. We sold our European Healthcare businesses and MiExact.
"We now have a higher quality portfolio of growing international businesses and continue to pursue various opportunities to invest in acquisitions to improve our growth and profitability. We have also started to transfer our businesses onto our single operating platform, which will continue to improve our performance.
"We have had a good start to the current financial year, with revenues and profits in line with expectations."
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement this inside information is now considered to be in the public domain.
|
For further information, please contact:
Wilmington plc Mark Milner, Chief Executive Officer Guy Millward, Chief Financial Officer
Meare Consulting Adrian Duffield |
020 7490 0049
07990 858548 |
Notes to Editors
Wilmington plc is the recognised knowledge leader and partner of choice for data, information, education and training in the global Governance, Risk and Compliance (GRC) markets. Wilmington employs over 600 people and sells to around 120 countries. Wilmington is listed on the main market of the London Stock Exchange.
CEO's review
Overview
We are pleased to report another year of good progress and delivering on our strategy with notably strong increases in revenues, profits and cash generation. We continued to focus our portfolio of businesses on the international Governance, Risk and Compliance (GRC) markets and significantly enhanced our capabilities with the acquisition of Astutis in the Health, Safety and Environment (HSE) sector. We sold our European Healthcare businesses and MiExact.
We also continued to invest in our operational growth levers, sales, marketing, product development and have moved decisively towards running all our operations on a single platform, by merging the previous platforms built for training and data operations. During the year, following the disposal of the businesses that made up the majority of our Intelligence division, we have reorganised our segmental reporting around the external markets addressed by our brands from Training & Education and Intelligence to HSE, Legal and Financial Services.
Results
For the year ending 30 June 2024, the Group saw overall organic revenue growth of 9%, with solid growth from all our ongoing businesses. We also achieved 16% growth in Group recurring revenues, making up 36% of total revenues (2023: 33%). We have achieved organic revenue growth every year in the last four financial years.
The increased revenues and a continued focus on operational efficiency resulted in total adjusted PBT growth of 13% to £27.6m (2023: £24.3m) and a corresponding improvement in adjusted PBT margin to 22% (2023: 20%). We have also achieved this profit growth over the last four years, despite selling or closing seven of the 15 businesses in the Group in 2020.
Profits from underlying operations (excluding the Astutis acquisition) were up 35%, driven by strong trading in our Financial Services businesses and net interest income on our cash of £2.0m. This resulted in underlying adjusted basic earnings per share being up 33%, which in turn has allowed us to propose an increase in dividend to a final dividend of 8.3p (total of 11.3p).
Statutory revenue was up 6% to £98.3m (2023: £93.1m). Statutory PBT was up 17% to £24.2m (2023: £20.5m). Total Basic EPS increased to 46.32p (2023: 22.94p).
The Group again strengthened its balance sheet, increasing its net cash position (excluding lease liabilities & including cash held for sale) to £67.8m (2023: £42.2m) after another strong year of converting profits to cash as well as the net cash received from portfolio changes. We have also significantly reduced our future lease liabilities by downsizing office footprints, including exiting our London offices. This will provide significant cost savings going forward and better complement our hybrid working policy, which has resulted in a need for far less office space.
Strategy
Our strategy is delivering, so there is no change here. We continued to focus on consolidating our already strong presence in the large, growing and rapidly evolving international GRC markets. These markets are underpinned by strong macro drivers, particularly the increasing volume and enforcement of regulation, complex geopolitical landscape, increased importance of ESG and widespread adoption of technological and data-driven compliance solutions, all of which align strongly to Wilmington's core offering.
At the heart of this focus on the GRC markets is our ambition to help our customers to do the right business in the right way, by providing a complementary range of information & data and training & education solutions. Our businesses focus on the financial services, legal and HSE markets. We are looking to acquire further businesses in these and complementary sectors.
Portfolio update
In November 2023, we completed the acquisition of Astutis, a training business offering a range of globally recognised and regulated health, safety and environmental qualifications, based in Cardiff. The business has achieved strong growth in the growing HSE market and is highly complementary to our existing portfolio. The acquisition of Astutis is consistent with our strategy in the GRC market to broaden and strengthen our training and education capabilities.
We continue to review all parts of the Group assessing businesses against six key characteristics: organic growth opportunities; attractive markets; digital and data capabilities; strong leadership; strategic fit to the GRC marketplaces; and attractive product, revenue, and profitability characteristics.
As part of this ongoing review, we determined that our Healthcare, Compliance Week and MiExact businesses no longer met our criteria. MiExact, a UK mortality data business, and the European Healthcare business were sold during the year, Compliance Week is in a sale process. We also closed our operations in Singapore and Malaysia due to continuing declining revenues, ongoing losses and little prospect of recovery given the local market conditions. We now serve the Singapore and Malaysia markets from the UK.
We continue to seek businesses to join the Group, with a highly active but disciplined M&A function exploring many options. To date, we have identified numerous businesses which meet our required characteristics. However, valuation expectations continue to remain high and we continue to take a very disciplined approach. Our priority is to allocate the capital available to us, including our cash balance, cash we generate from our profitable operations, and our borrowing capability, to acquisitions in the next two years.
Investment
Our investment approach across the Group continues to be targeted at embedding the unique characteristics that define our competitive advantage into each of our brands. We are pleased with the progress we have made in developing a single technology platform for our businesses, by merging our previous platform investments and removing more of our legacy technology debt. We have more work to do to achieve a single platform for everything we do but the building blocks are in place and should deliver operational efficiencies in FY25 as expected. The implementation of a single platform will also allow us to efficiently expand our offering by creating a scalable portfolio to enhance our growth potential.
We continue to invest organically in new products and strengthen our existing product offerings, with the scope to monetise our solutions greatly enhanced by our single platform approach. This strategy for maximising the value of our technology and data assets, combined with our streamlined operating model, provides the strong base to actively consider acquisition targets which complement and/or extend our capabilities.
We reported last year that within the strategic framework of Wilmington, deliberate measures are being put into action to navigate the risks that accompany AI technology while simultaneously harnessing its opportunities. Work continues to mitigate risks and incorporate AI into our products.
We also remain focused on investing in the many drivers of employee engagement, which increased year on year as measured by our annual engagement survey. Development is actioned by activities such as regular Town Halls, the building and support of communities, and development of Working Groups to focus on keys areas such as diversity and inclusion, reward strategies, talent development and others.
Responsible business
We are committed to investing in the initiatives that support our colleagues and our own responsible business culture.
We continue to make significant progress with our People Strategy. Our people make our business, and our continued success in this financial year is down to their hard work, ingenuity, skills and expertise, and I thank everyone for their commitment to Wilmington.
We have achieved progress against our targets in all four areas of our sustainability strategy, and this work continues to underpin our broader strategic objectives and risk management processes. Full details of this work can be found in our Sustainability report.
We implemented the Taskforce for Climate-related Financial Disclosures (TCFD) recommendations in full two years ago, while still putting together some further detail on the metric requirements. We concluded that we must continue to monitor the impacts of climate change on the Group's risk profile, but that the potential opportunities that may arise from the transition to a low-carbon economy are well aligned to our core offering. We have committed to net-zero carbon targets, with an ambition of absolute zero, producing no greenhouse gas emissions, in respect of Scope 1 and 2 emissions by 2028, and net zero in respect of Scope 3 emissions by 2045.
Review of operations
|
|
2024 |
2023 |
Absolute variance |
Organic variance[5] |
|
|
£'m |
£'m |
% |
% |
|
Revenue |
|
|
|
|
|
HSE[6] |
4.8 |
|
|
|
|
Legal[7] |
16.0 |
14.0 |
14% |
14% |
|
Insurance |
28.8 |
27.8 |
3% |
6% |
|
Other |
40.1 |
36.9 |
9% |
9% |
|
Financial Services[8] |
68.9 |
64.7 |
6% |
7% |
|
Ongoing revenue |
89.7 |
78.7 |
14% |
9% |
|
Ongoing operating profit |
28.1 |
21.9 |
28% |
24% |
|
Margin % |
31% |
28% |
|
|
|
|
|
|
|
|
|
Total revenue[9] |
126.0 |
123.5 |
2% |
|
|
Total operating profit |
31.6 |
29.3 |
8% |
|
Group performance
Revenues from ongoing businesses grew 14%, 9% excluding currency gains and the Astutis acquisition. All eight of the ongoing businesses grew organically and recurring subscription revenues grew 16%.
Astutis features for the first time so has no variances on last year, and the numbers are for a partial year. The business grew significantly on its prior year performance.
Group operating profits improved by 24% organically and operating margins for ongoing businesses increased to 31% on the back of the revenue increases and continued cost improvements.
Segmental reporting
Following the acquisition of Astutis, a training business in the HSE sector and the disposal of the European Healthcare and MiExact businesses and the decision to sell Compliance Week, which together made up the majority of what was previously our Intelligence Division, we have reorganised our segmental reporting around the external markets addressed by our brands.
HSE
The HSE segment comprises Astutis, acquired in November 2023. Astutis is a UK training business which mixes face-to-face and online learning for various industry standard qualifications and certificates in the HSE sector. The business has experienced strong growth in recent years after switching focus to more online training post-Covid and has a strong market position in a growing marketplace.
Legal
The Legal segment comprises Bond Solon and Pendragon, whose customers are predominantly in the legal market. Bond Solon is mainly UK based and trains individuals involved in the legal system, including lawyers, helping them train their clients for interaction with the legal system. Revenue is earned through one off course attendance fees. Courses are typically single or half day events, and content is a mix of owned and third-party intellectual property. Courses are delivered either by in-house experts or a network of independent tutors who are paid per course. The Law for Non-Lawyers market is strong, with good ongoing demand for existing products as well as successful launches of new training courses.
Pendragon operates in the UK pensions market, providing information products and services with revenues generated primarily through subscription.
Legal revenues grew 14% organically, led by Bond Solon which had a significant contract win in the public sector to give it a second consecutive year of double-digit revenue growth. Pendragon had a strong year for subscription revenue growth and again achieved very strong customer retention (99%).
Financial Services
Financial Services Insurance comprises Axco and FRA. Axco provides a broad range of information products and services with revenues generated primarily through subscription, and customers are spread globally.
FRA is predominantly events based. It serves the US Healthcare and Health Insurance markets and, to a lesser extent, the US financial and legal service communities. The prime brand is the RISE series of events that addresses the Medicare and Medicaid markets and is attended by health plans, physician groups and solution partners. The flagship event is RISE National which normally takes place in March each year. Revenue from the US events is generated from both sponsorship and delegate sales.
Financial Services Insurance revenues grew 6% overall. Axco grew revenues by 7%, excluding currency gains, and had a strong year for subscription revenue growth. Recurring revenue retention rates were at 99%. FRA revenues were flat in sterling terms but grew 4% in US dollars, delegate revenues were again strong.
Financial Services Other comprises three businesses that operate in Compliance markets. The largest business, which was developed organically within Wilmington, is the International Compliance Association ('ICA'). It is an industry body and training business that was created in 2002. It offers professional development and support to compliance officers predominantly in the financial services sector. It has offices in the UK and Dubai, and a presence in India.
The material for ICA courses is developed by our own internal R&D team, and external specialists. We own the associated intellectual property. Revenue earned by ICA is primarily training income complemented by subscriptions paid by the professional members for their ICA accreditations. The courses ICA run usually extend over several weeks or even months. They traditionally mix distance learning with face-to-face sessions. The distance learning element has transitioned to online and digital variants, and virtual programmes have been offered in place of face-to-face sessions.
The second business, CLTi, earns revenue from running professional development programmes for wealth managers, in association with The Society of Trust and Estate Practitioners. Wilmington has an international presence, with customers in the UK, Europe, Asia Pacific and the US. Our consistent investment programme in content and technology is maintaining our competitive positioning.
The third business, Mercia, provides training for accountants in practice and in business. It runs a mix of face-to-face, online, and blended learning for this community. It provides training at various levels including providing continuing professional development for existing qualified accountants. Additionally, it provides technical support to accountancy firms which enables them to keep abreast of technical developments and changes to regulation, as well as supporting them to promote the services they then offer to their clients.
Mercia is predominantly UK and Ireland based reflecting the country specific laws and accounting standards that govern the profession. Revenue in the unit is earned through clients subscribing for ongoing training, support and other related activities over a period of time (usually 12 months), with the rest through one off course attendance fees. Courses are typically single or half day events, and content is a mix of owned and third-party intellectual property. Courses are delivered either by in-house experts or a network of independent tutors who are paid per course that they deliver.
Financial Services Other, overall revenues grew 9%. CLTi and ICA UK and Middle East revenues were up by double digit percentage points. ICA saw continued revenue decline in Singapore and Malaysia and the business there became loss-making. Without any sign of a return to profit or revenue growth in the near future we took the decision to close our operations in Singapore and Malaysia and to service the area from the UK. Mercia revenues grew 4% in the year and significantly improved its recurring revenues.
Financial review
Overview
The Group performance was again strong during the year, driving organic growth in revenue and profit and improving the balance sheet, reflected by the increased closing net cash position and the reduced lease liabilities. We also sold our Healthcare and MiExact businesses and acquired Astutis, all of which have a significant effect on our balance sheet and trading.
Adjusting items, measures, and adjusted results
In this financial review reference is made to adjusted results as well as the equivalent statutory measures. The Directors make use of adjusted results, which are not considered to be a substitute for, or superior to, IFRS measures, to provide stakeholders with additional relevant information and enable an alternative comparison of performance over time. Adjusted results exclude amortisation of intangible assets (excluding computer software), impairments, other income (when material or of a significant nature) and other adjusting items.
|
|
2024 |
2023 |
Absolute variance |
Organic variance |
|
|
|
£'m |
£'m |
£'m |
% |
% |
|
Statutory continuing revenue |
98.3 |
93.1 |
5.2 |
6% |
7% |
|
Continuing Adjusted profit before tax |
23.7 |
19.5 |
4.2 |
21% |
|
|
Continuing Adjusted profit margin % |
24% |
20% |
|
|
|
Variances described as 'organic' are calculated by adjusting the revenue change achieved year-on-year to exclude the impact of changes in foreign currency exchange rates and also to exclude the impact of changes in the portfolio from acquisitions and disposals.
Revenue
Group revenue increased 6% on a statutory continuing basis and 9% on an organic basis, the statutory continuing increase reflecting £0.9m of foreign currency downside and the impact of disposals carried out part way through the year. Full details can be found in the review of operations.
Operating expenses before amortisation of intangible assets (excluding computer software), impairment and adjusting items
Operating expenses before amortisation of intangible assets (excluding computer software) and impairments increased to £76.6m (2023: £73.8m).
Within operating expenses, staff costs were £43.6m (2023: £44.4m). This net decrease reflects the reduced salary cost as a result of the decrease in headcount post disposals which was partly offset by inflationary pay rises. Share based payment costs increased £0.4m due to a full year of charge relating to the 2023 SAYE scheme and the introduction of the 2024 SAYE scheme, which commenced in the year.
Non-staff costs increased by £3.6m to £33.0m (2023: £29.4m), reflecting the current year costs of Astutis from November and general inflationary increases.
Unallocated central overheads
Unallocated central overheads, representing Board costs and head office salaries, as well as other centrally incurred costs were £4.2m (2023: £3.7m).
Adjusted profit before tax ('adjusted PBT')
As a result of increased revenue and a continued focus on operational efficiency, adjusted profit before tax, which eliminates the impact of amortisation of intangible assets (excluding computer software), impairments, other income and other adjusting items, was up 21% to £23.7m (2023: £19.5m). Adjusted profit margin (adjusted PBT expressed as a percentage of revenue) also increased to 24% (2023: 20%).
Total Group adjusted profit before tax was up 13% to £27.6m (2023: £24.3m) and on a total basis the adjusted profit margin increased to 22% (2023: 20%).
Amortisation excluding computer software, impairment, adjusting charge and other income
Amortisation of intangible assets (excluding computer software) was £2.1m (2023: £1.1m) representing amortisation from acquired intangibles. The increase year on year largely reflects the acquisition of Astutis made during the year.
The non-cash impairment of £4.4m (2023: £nil) represents the impairment of goodwill in Compliance Week. The adjusting charge of £0.6m (2023: £0.1m) represents strategic costs for acquisitions.
Gain on disposals represents a total net gain of £26.8m consisting of £5.5m included within other income largely relating to MiExact, and £21.3m gain disposal of European Healthcare included within profit from discontinued operations, see note 11 for further details. Other income also includes £2.2m representing a gain on the sale of a building and the early exit of the head office lease leading to a lease modification, see note 5a for further details.
Operating profit
Operating profit was £22.2m (2023: £20.3m), driven largely by the £5.5m gain on disposal of subsidiaries (2023: £2.2m), the gain on disposal of property, plant and equipment and lease modification of £2.2m, partially offset by £4.4m of goodwill impairment.
Net finance income
Net finance income up £1.8m to £2.0m (2023: £0.2m), primarily related to the interest received on the significant cash balance the Group maintained during the year.
Profit before taxation
Profit before taxation was £24.2m (2023: £20.5m); a reconciliation of profit before tax to adjusted profit before tax can be found in note 3.
Taxation
The tax charge for the year was £7.0m (2023: £3.3m) reflecting an effective tax rate of 29.4% (2023: 16.2%). The increase in the tax rate year-on-year reflects an increase in the full year of UK corporation tax at 25%, offset by the nature of other operating income with business disposals qualifying for the SSE.
The underlying tax rate which ignores the tax effects of adjusting items increased to 27.2% (2023: 25.2%). The increase reflects the full year of the UK corporation tax increase from 19% to 25%, with only one quarter being applied to FY23.
Earnings per share
Adjusted basic earnings per share increased by 17% to 19.38p (2023: 16.57p) see note 9, due to the increase in adjusted profit before tax, offset by an increase in the corporation tax rate causing an increase in the underlying tax rate. The number of issued ordinary shares was essentially unchanged. Total Basic earnings per share was 46.32p (2023: 22.94p) reflecting the increase in profit after tax, see note 9.
Ongoing adjusted basic earnings per share, excluding the results of sold and closed businesses, increased by 41% to 19.81p (2023: 14.02p), see reconciliation below.
|
|
2024 £'m |
2023 £'m |
|
|
Adjusted earnings (note 9) |
20.4 |
18.9 |
|
|
Remove profit after tax of sold and closed businesses |
(2.8) |
(6.6) |
|
|
Ongoing adjusted earnings |
17.6 |
12.3 |
|
|
|
|
|
|
|
|
2024 Number |
2023 Number |
Variance |
|
Weighted average number of ordinary shares (note 9) |
88,964,817 |
88,027,119 |
|
|
|
|
|
|
|
Ongoing adjusted basic earnings per share |
19.81p |
14.02p |
41% |
Dividend
A final dividend of 8.3p per share (2023: 7.3p) will be proposed at the AGM. This will give a full year dividend up 13% to 11.3p (2023: 10.0p) and dividend cover of 2.0 times (2023: 2.1 times).
If approved it will be paid on 4 December 2024 to shareholders on the register as at 1 November 2024 with an associated ex-dividend date of 31 October 2024.
Balance sheet
Non-current assets
Goodwill at 30 June 2024 was £52.8m (2023: £60.6m). The decrease is due to disposals of £14.3m and impairment in the Compliance Week CGU of £4.4m, following the decision to sell it, with the remaining goodwill in Compliance Week of £0.4m transferred to held for sale, partly offset by the goodwill arisen from the acquisition of Astutis of £11.2m.
Intangible assets increased by £4.5m to £10.2m (2023: £5.7m) due to the acquisition of Astutis of £9.9m and additions of £0.2m within computer software; partly offset by amortisation of £3.7m, and £1.8m of disposals largely relating to the disposal of subsidiaries. The remaining £0.1m variance reflects exchange translation differences.
Property, plant and equipment decreased by £3.9m to £3.1m (2023: £7.0m). This is attributable to the £1.5m decrease from disposals largely relating to the disposal of subsidiaries, £0.8m decrease due to the lease modification, depreciation of £1.8m and an impairment of the assets associated with the head office of £0.4m. Partly offset by additions of £0.1m and £0.4m recognised from the acquisition of Astutis. The remaining £0.1m reflects exchange translation differences.
Deferred consideration receivable
The deferred consideration receivable balance of £16.5m (2023: £1.9m) relates to the disposal of ICP in July 2018, the disposal of MiExact in January 2024 (see note 11), and the disposal of UK Healthcare in June 2024 (see note 11), with £14.8m recognised within non-current assets and the remaining £1.7m recognised within current assets.
Trade and other receivables
Trade and other receivables reduced to £20.3m (2023: £27.4m) largely due to the disposals of Healthcare and MiExact.
Current tax liability
At 30 June 2024 the Group recognised a liability relating to current tax of £1.1m (2023: £0.1m).
Deferred tax
The deferred tax liability of £1.4m (2023: asset £0.3m) comprises the deferred tax liability for acquired intangibles on acquisition of Astutis, partly offset by a deferred tax credit for the change in corporation tax rate and movement in capital allowances. The deferred tax expense in the P&L £0.1m (2023: £1.1m credit) comprises the change in corporation tax rate and movements in capital allowances.
Trade and other payables
Trade and other payables decreased by £5.5m to £50.5m (2023: £56.0m). Within this, contract liabilities decreased by £5.8m to £27.9m (2023: £33.7m) largely due to the disposals of Healthcare and MiExact.
Provisions
Provisions were £0.2m (2023: £1.2m) in respect of anticipated future costs in relation to the closed proportion of the head office until the end of the contractual lease term. During the year, the lease term on the head office building was renegotiated and we will exit the building in December 2024, the provision was unwound by £0.8m, utilised by £0.2m, and the liability reflects the term until December 2024.
Net cash, lease liabilities and cash flow
Net cash, which includes cash and cash equivalents, cash classified as held for sale and lease liabilities, was £65.0m (2023: £35.0m). This significant net cash position is driven by a strong trading performance delivering improved profits and effective cash management as well as a cash inflow associated with the disposal of businesses offset by the purchase of Astutis. Please refer to note 15 for further information.
Lease liabilities decreased to £2.8m (2023: £7.2m). £0.9m (2023: £2.1m) cash payments in relation to contractual lease obligations were made reducing the balance, the lease modification reduced the balance by £2.7m, coupled with disposals of £1.3m. The reduction is offset by £0.2m (2023: £0.2m) of notional interest on lease liabilities reported within finance costs and additions of £0.3m upon the acquisition of Astutis.
Cash conversion remained strong at 116% (2023: 138%). See note 14 for further details.
Share capital
In October 2023 Wilmington issued 823,568 ordinary voting shares of £0.05 to satisfy the Company's obligations under its Performance Share Plan. In December 2023 Wilmington issued 582,637 ordinary voting shares of £0.05 to satisfy the Company's obligations under its SAYE Plan.
During the year 53,519 shares held by the Employee Share Ownership Trust ('ESOT') were used to satisfy the Company's obligations under the SAYE Plan and 54,610 shares held by the ESOT to satisfy the Company's obligations under its Performance Share Plan. At 30 June 2024, the ESOT held 244,522 shares (2023: 352,651) in the Company, which represents 0.3% (2023: 0.4%) of the called up share capital.
During the year 391 shares held in treasury were used to satisfy the Company's obligations under the SAYE Plan. At 30 June 2024, 4,817 shares (2023: 5,208) were held in treasury, which represents 0.1% (2023: 0.1%) of the share capital of the Company.
Portfolio update
Acquisition of Astutis
In November 2023, we completed the acquisition of Astutis, a training business offering a range of globally recognised and regulated health, safety and environmental qualifications, based in Cardiff, for an initial consideration of £16.8m, with contingent consideration of up to £4.7m based on Astutis' performance in each of the two years ending 30 June 2025 and 30 June 2026. The business has achieved strong growth in recent years in the growing HSE market and is highly complementary to our existing portfolio. The acquisition of Astutis, which is earnings enhancing, is consistent with our strategy in the GRC market to broaden and strengthen our training and education capabilities. Astutis embodies all of our six key business characterises in that it operates in growing GRC focused regulated markets, has a strong and experienced management team, a comprehensive products suite, growing revenues and profits, and excellent digital capabilities. The fair value of the net assets acquired in the business at acquisition date was £9.0m, resulting in goodwill on acquisition of £11.2m. See note 10 for further details.
Disposals
We continue to review all parts of the Group assessing businesses against six key characteristics: organic growth opportunities; attractive markets; digital and data capabilities; strong leadership; strategic fit to the GRC marketplaces; and attractive product, revenue, and profitability characteristics. As part of this ongoing review we determined that our Healthcare, Compliance Week and MiExact businesses no longer met our criteria. MiExact and Healthcare were sold during the year, Compliance Week is in a sale process. We also took the decision to close our business in Singapore and Malaysia due to continuing declining revenues, ongoing losses and little prospect of recovery given the local market conditions. We will continue to serve the Singapore and Malaysia markets from the UK.
MiExact, a UK mortality data business, was sold in January 2024 for £9.6m recognising a gain of £5.9m included within other income. The European Healthcare business was sold in two parts. The first was the disposal of APM, a French healthcare business, for €26.0m in cash in April 2024 recognising a gain on disposal of €23.3m (£19.9m) included within discontinued operations. The second was the sale of the UK healthcare business for a consideration of up to £26.3m recognising a gain on disposal of £1.5m included within discontinued operations. See note 11 for further details.
Consolidated income statement
for the year ended 30 June 2024
|
|
|
Notes |
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
|
Continuing operations |
|
|
|
|
|
Revenue |
4 |
98,324 |
93,065 |
|
|
Operating expenses before amortisation of intangibles excluding computer software, impairment and adjusting items |
|
(76,645) |
(73,792) |
|
|
Impairment of goodwill |
5b |
(4,434) |
- |
|
|
Amortisation of intangible assets excluding computer software |
5b |
(2,090) |
(1,078) |
|
|
Adjusting items |
5b |
(598) |
(147) |
|
|
Operating expenses |
|
(83,767) |
(75,017) |
|
|
Other income - gain on disposal of subsidiaries |
11 |
5,465 |
2,212 |
|
|
Other income - gain on disposal of property, plant and equipment and lease modification |
5a |
2,189 |
- |
|
|
Operating profit |
|
22,211 |
20,260 |
|
|
Finance income |
6 |
2,172 |
478 |
|
|
Finance expense |
6 |
(175) |
(246) |
|
|
Profit before tax |
|
24,208 |
20,492 |
|
|
Taxation |
7 |
(7,009) |
(3,317) |
|
|
Profit for the year from continuing operations |
|
17,199 |
17,175 |
|
|
Profit for the year from discontinued operations |
11 |
24,011 |
3,020 |
|
|
Profit for the year attributable to owners of the parent |
|
41,210 |
20,195 |
|
|
|
|
|
|
|
|
Earnings per share from continuing operations: |
|
|
|
|
|
Basic (p) |
9 |
19.33 |
19.51 |
|
|
Diluted (p) |
9 |
18.96 |
19.03 |
|
|
|
|
|
|
|
|
Earnings per share from continuing and discontinued operations: |
|
|
|
|
|
Basic (p) |
9 |
46.32 |
22.94 |
|
|
Diluted (p) |
9 |
45.44 |
22.38 |
Consolidated statement of comprehensive income
for the year ended 30 June 2024
|
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
|
Profit for the year |
41,210 |
20,195 |
|
|
Other comprehensive expense: |
|
|
|
|
Items that may be reclassified subsequently to the income statement |
|
|
|
|
-Currency translation differences |
(238) |
(991) |
|
|
Other comprehensive expense for the year, net of tax |
(238) |
(991) |
|
|
Total comprehensive income for the year attributable to owners of the parent |
40,972 |
19,204 |
Balance sheets
as at 30 June 2024
|
|
Notes |
2024 £'000 |
2023 £'000 |
|
Non-current assets |
|
|
|
|
Goodwill |
|
52,763 |
60,561 |
|
Other intangible assets |
|
10,236 |
5,734 |
|
Property, plant and equipment |
|
3,085 |
7,015 |
|
Investment in subsidiaries |
|
- |
- |
|
Deferred consideration receivable |
|
14,786 |
1,152 |
|
Deferred tax assets |
|
- |
925 |
|
|
|
80,870 |
75,387 |
|
Current assets |
|
|
|
|
Trade and other receivables |
12 |
20,339 |
27,391 |
|
Deferred consideration receivable |
|
1,732 |
752 |
|
Cash and cash equivalents |
|
67,515 |
42,173 |
|
Assets of disposal group held for sale |
11 |
1,196 |
- |
|
|
|
90,782 |
70,316 |
|
Total assets |
|
171,652 |
145,703 |
|
Current liabilities |
|
|
|
|
Trade and other payables |
13 |
(50,460) |
(55,966) |
|
Lease liabilities |
|
(1,257) |
(975) |
|
Current tax liabilities |
|
(1,058) |
(44) |
|
Provisions |
|
(154) |
(307) |
|
Liabilities of disposal group held for sale |
11 |
(486) |
- |
|
|
|
(53,415) |
(57,292) |
|
Non-current liabilities |
|
|
|
|
Lease liabilities |
|
(1,571) |
(6,235) |
|
Deferred tax liabilities |
|
(1,351) |
(607) |
|
Provisions |
|
- |
(921) |
|
|
|
(2,922) |
(7,763) |
|
Total liabilities |
|
(56,337) |
(65,055) |
|
Net assets |
|
115,315 |
80,648 |
|
Equity |
|
|
|
|
Share capital |
|
4,478 |
4,408 |
|
Share premium |
|
47,463 |
45,553 |
|
Treasury and ESOT reserves |
|
(617) |
(786) |
|
Share based payments reserve |
|
2,889 |
2,635 |
|
Translation reserve |
|
3,193 |
3,431 |
|
Retained earnings |
|
57,909 |
25,407 |
|
Total equity |
|
115,315 |
80,648 |
Statements of changes in equity
for the year ended 30 June 2024
|
|
Share capital, share premium, treasury shares and ESOT shares £'000 |
Share based payments reserve £'000 |
Translation reserve £'000 |
Retained earnings £'000 |
Total equity £'000 |
|
Group |
|
|
|
|
|
|
At 1 July 2022 |
48,851 |
2,141 |
4,422 |
11,675 |
67,089 |
|
Profit for the year |
- |
- |
- |
20,195 |
20,195 |
|
Other comprehensive expense for the year |
- |
- |
(991) |
- |
(991) |
|
|
48,851 |
2,141 |
3,431 |
31,870 |
86,293 |
|
Transactions with owners: |
|
|
|
|
|
|
Dividends paid |
- |
- |
- |
(7,462) |
(7,462) |
|
Issue of share capital |
17 |
- |
- |
- |
17 |
|
Performance share plan awards vesting |
- |
(717) |
- |
854 |
137 |
|
Save As You Earn options settlement via ESOT |
154 |
(11) |
- |
(16) |
127 |
|
Save As You Earn options settlement via treasury shares |
153 |
- |
- |
(64) |
89 |
|
Share based payments |
- |
1,222 |
- |
- |
1,222 |
|
Tax on share based payments |
- |
- |
- |
225 |
225 |
|
At 30 June 2023 |
49,175 |
2,635 |
3,431 |
25,407 |
80,648 |
|
Profit for the year |
- |
- |
- |
41,210 |
41,210 |
|
Other comprehensive expense for the year |
- |
- |
(238) |
- |
(238) |
|
|
49,175 |
2,635 |
3,193 |
66,617 |
121,620 |
|
Transactions with owners: |
|
|
|
|
|
|
Dividends paid |
- |
- |
- |
(9,153) |
(9,153) |
|
Issue of share capital |
71 |
- |
- |
- |
71 |
|
Issue of share premium |
1,910 |
- |
- |
- |
1,910 |
|
Performance share plan awards vesting settlement via share issue |
- |
(1,109) |
- |
(139) |
(1,248) |
|
Performance share plan options settlement via ESOT |
127 |
(67) |
- |
- |
60 |
|
Save As You Earn options vesting settlement via share issue |
- |
(174) |
- |
212 |
38 |
|
Save As You Earn options settlement via treasury shares |
1 |
- |
- |
- |
1 |
|
Save As You Earn options settlement via ESOT |
40 |
(29) |
- |
(7) |
4 |
|
Share based payments |
- |
1,633 |
- |
- |
1,633 |
|
Tax on share based payments |
- |
- |
- |
379 |
379 |
|
At 30 June 2024 |
51,324 |
2,889 |
3,193 |
57,909 |
115,315 |
Cash flow statements
for the year ended 30 June 2024
|
|
|
Notes |
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
|
Cash flows from operating activities |
|
|
|
|
|
Cash generated from operations before adjusting items |
14 |
29,747 |
33,205 |
|
|
Cash flows for adjusting items - operating activities |
|
(1,826) |
(375) |
|
|
Cash flows from tax on share based payments |
|
(222) |
(2) |
|
|
Cash generated from operations |
|
27,699 |
32,828 |
|
|
Interest received |
|
1,946 |
344 |
|
|
Tax paid |
|
(7,115) |
(3,268) |
|
|
Net cash generated from operating activities |
|
22,530 |
29,904 |
|
|
Cash flows from investing activities |
|
|
|
|
|
Disposal of subsidiaries net of cash |
11 |
26,561 |
1,549 |
|
|
Purchase of subsidiary net of cash |
10 |
(15,923) |
- |
|
|
Deferred consideration received |
|
888 |
250 |
|
|
Cash flows for adjusting items - investing activities |
|
(59) |
(6) |
|
|
Purchase of property, plant and equipment |
|
(132) |
(461) |
|
|
Proceeds from disposal of property, plant and equipment |
|
884 |
13 |
|
|
Purchase of intangible assets |
|
(235) |
(595) |
|
|
Net cash generated from investing activities |
|
11,984 |
750 |
|
|
Cash flows from financing activities |
|
|
|
|
|
Dividends paid to owners of the parent |
|
(9,153) |
(7,462) |
|
|
Cash received from sale of shares for share vesting |
|
927 |
573 |
|
|
Share issuance costs |
|
(70) |
(14) |
|
|
Payment of lease liabilities |
|
(881) |
(2,109) |
|
|
Net cash used in financing activities |
|
(9,177) |
(9,012) |
|
|
Net increase in cash and cash equivalents |
|
25,337 |
21,642 |
|
|
Cash and cash equivalents at beginning of the year |
|
42,173 |
20,543 |
|
|
Exchange gain/(loss) on cash and cash equivalents |
|
5 |
(12) |
|
|
Cash classified as held for sale |
|
293 |
- |
|
|
Cash and cash equivalents at end of the year |
|
67,808 |
42,173 |
Notes to the financial statements
1. Nature of the Financial Statements
The following financial information does not amount to full financial statements within the meaning of Section 434 of Companies Act 2006.
Financial statements for the year ended 30 June 2023 have been delivered to the Registrar of Companies; the report of the auditors on those accounts was unqualified and did not contain a statement under Section 498 of the Companies Act 2006. The 2024 statutory accounts will be delivered in due course. Information has been extracted from the draft statutory financial statements for the year ended 30 June 2024 which will be delivered to the Registrar of Companies in due course. Accordingly, the financial information for 2024 is presented unaudited in the preliminary announcement.
Copies of the Annual Report and Financial Statements will be made available to shareholders shortly and printed copies will be available from the Company's registered office at 10 Whitechapel High Street, London, E1 8QS.
2. Statement of accounting policies
The preliminary announcement for the year ended 30 June 2024 has been prepared in accordance with UK adopted international accounting standards (UK adopted IAS). The accounting policies applied in this preliminary announcement are consistent with those reported in the Group's Annual Financial Statements for the year ended 30 June 2023. There was no material effect from the adoption of new standards or interpretations in the year ended 30 June 2024.
3. Measures of profit
Reconciliation to profit on continuing activities before tax
To provide shareholders with additional understanding of the trading performance of the Group, adjusted EBITA has been calculated as profit before tax after adding back:
• impairment of goodwill;
• amortisation of intangible assets excluding computer software;
• adjusting items (included in operating expenses);
• other income - gain on disposal of subsidiaries;
• other income - gain on disposal of property, plant and equipment and lease modification; and
• net finance income.
Adjusted profit before tax, adjusted EBITA and adjusted EBITDA reconcile to profit on continuing activities before tax as follows:
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Profit before tax |
24,208 |
20,492 |
|
Impairment of goodwill |
4,434 |
- |
|
Amortisation of intangible assets excluding computer software |
2,090 |
1,078 |
|
Adjusting items (included in operating expenses) |
598 |
147 |
|
Other income - gain on disposal of subsidiaries |
(5,465) |
(2,212) |
|
Other income - gain on disposal of property, plant and equipment and lease modification |
(2,189) |
- |
|
Adjusted profit before tax |
23,676 |
19,505 |
|
Net finance income |
(1,997) |
(232) |
|
Adjusted operating profit ('adjusted EBITA') |
21,679 |
19,273 |
|
Depreciation of property, plant and equipment included in operating expenses |
1,711 |
2,121 |
|
Amortisation of intangible assets - computer software |
1,004 |
1,525 |
|
Adjusted EBITA before depreciation ('adjusted EBITDA') |
24,394 |
22,919 |
|
Adjusted EBITA |
21,679 |
19,273 |
|
Add EBITA from statutory discontinued operations |
3,874 |
4,833 |
|
Total Group adjusted EBITA |
25,553 |
24,106 |
|
Adjusted profit before tax |
23,676 |
19,505 |
|
Add adjusted profit before tax from statutory discontinued operations |
3,874 |
4,833 |
|
Total Group adjusted profit before tax |
27,550 |
24,338 |
|
|
|
|
|
Remove operating profit from sold and closed businesses |
(3,484) |
(7,410) |
|
Ongoing adjusted profit before tax |
24,066 |
16,928 |
4. Segmental information
In accordance with IFRS 8 the Group's operating segments are based on the operating results reviewed by the Executive Board, which represents the chief operating decision maker.
During the year, the Group reorganised its business into three Divisions (HSE, Legal and Financial Services) to compliment the changes to the Group structure as a result of the significant disposals and the acquisition, the segments give greater focus to the customer base. These reportable segments reflect the internal reporting provided to the Chief Operating Decision Maker (the Executive Board) on a regular basis to assist in making decisions and to assess performance. Segment information has been restated in the prior period to align to the current reportable segments.
The Group's dynamic portfolio provides customers with a range of information, data, training and education solutions. The Board considers the business from both a geographic and product perspective. Geographically, management considers the performance of the Group between the UK, Europe (excluding the UK), the USA and the Rest of the World.
a) Business segments
|
|
Revenue Year ended 30 June 2024 £'000 |
Profit/(loss) Year ended 30 June 2024 £'000 |
Revenue Year ended 30 June 2023 £'000 |
Profit Year ended 30 June 2023 £'000 |
|
HSE |
4,837 |
1,201 |
- |
- |
|
Legal |
15,986 |
6,173 |
14,014 |
6,014 |
|
Financial Services |
68,850 |
20,726 |
64,717 |
15,900 |
|
Ongoing |
89,673 |
28,100 |
78,731 |
21,914 |
|
Non-core |
8,651 |
(390) |
14,334 |
2,577 |
|
Group total |
98,324 |
27,710 |
93,065 |
24,491 |
|
Unallocated central overheads |
- |
(4,166) |
- |
(3,703) |
|
Share based payments |
- |
(1,865) |
- |
(1,515) |
|
|
98,324 |
21,679 |
93,065 |
19,273 |
|
Impairment of goodwill |
|
(4,434) |
|
- |
|
Amortisation of intangible assets excluding computer software |
|
(2,090) |
|
(1,078) |
|
Adjusting items (included in operating expenses) |
|
(598) |
|
(147) |
|
Other income - gain on disposal of subsidiaries |
|
5,465 |
|
2,212 |
|
Other income - gain on disposal of property, plant and equipment and lease modification |
|
2,189 |
|
- |
|
Net finance income |
|
1,997 |
|
232 |
|
Profit before tax from continuing operations |
|
24,208 |
|
20,492 |
|
Taxation |
|
(7,009) |
|
(3,317) |
|
Profit for the financial year from continuing operations |
|
17,199 |
|
17,175 |
There are no intra-segmental revenues which are material for disclosure. Unallocated central overheads represent central costs that are not specifically allocated to segments. Total assets and liabilities for each reportable segment are not presented; as such information is not provided to the Board.
b) Segmental information by geography
The UK is the Group's country of domicile and the Group generates the majority of its revenue from external customers in the UK. The geographical analysis of revenue is on the basis of the country of origin in which the customer is invoiced:
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
UK |
52,353 |
49,441 |
|
USA |
25,761 |
24,050 |
|
Europe (excluding the UK) |
10,777 |
10,481 |
|
Rest of the World |
9,433 |
9,093 |
|
Revenue from continuing operations |
98,324 |
93,065 |
c) Timing of revenue recognition
The timing of the Group's revenue recognition is as follows:
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Revenue from products and services transferred at a point in time |
60,322 |
55,223 |
|
Revenue from products and services transferred over time |
38,002 |
37,842 |
|
Revenue from continuing operations |
98,324 |
93,065 |
During the year the Group recognised £33,659,000 of revenue that was held as a contract liability at 30 June 2023 (2023: £31,405,000 related to amounts held at 30 June 2022).
5. Profit from continuing operations
a) Profit for the year from continuing operations is stated after charging/(crediting):
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Depreciation of property, plant and equipment - included in operating expenses |
1,711 |
2,121 |
|
Short-term and low-value leases |
143 |
94 |
|
Amortisation of intangible assets - computer software |
1,004 |
1,525 |
|
Non-adjusting profit on disposal of property, plant and equipment |
- |
(36) |
|
Share based payments (including social security costs) |
1,865 |
1,515 |
|
Amortisation of intangible assets excluding computer software |
2,090 |
1,078 |
|
Adjusting items (included in operating expenses) |
598 |
147 |
|
Adjusting item - gain on disposal of subsidiaries |
(5,465) |
(2,212) |
|
Adjusting item - gain on sale of property, plant and equipment and lease modification |
(2,189) |
- |
|
Research and development expenditure credit |
- |
(200) |
|
Impairment of goodwill |
4,434 |
- |
|
Foreign exchange loss |
87 |
179 |
|
Fees payable to the auditor for the audit of the Company and consolidated financial statements |
209 |
153 |
|
Fees payable to the auditor and their associates for other services: |
|
|
|
- The audit of the Company's subsidiaries pursuant to legislation |
241 |
240 |
|
- Audit related other services |
17 |
17 |
The gain on property, plant and equipment and lease modification relates to the sale of a building realising a gain of £0.9m, and an early exit of the head office lease releasing a gain of £1.3m. The gain on exit of the head office contains a lease modification. The right-of use asset was reduced by £1.0m and the lease liability was reduced by £2.8m, property, plant and equipment were impaired by £0.4m, a provision was unwound of £0.8m, and professional fees and a lease surrender expense of £0.9m were recognised.
b) Adjusting items
The following items have been charged to the income statement during the year but are considered to be adjusting so are shown separately:
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Expense relating to strategic activities |
598 |
147 |
|
Other adjusting items (included in operating expenses) |
598 |
147 |
|
Impairment of goodwill |
4,434 |
- |
|
Amortisation of intangible assets excluding computer software |
2,090 |
1,078 |
|
Total adjusting items (classified in profit before tax) |
7,122 |
1,225 |
During the year, the Compliance Week CGU was impaired. Expenses related to strategic activities represent acquisition costs of £0.6m.
6. Finance income and expense
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
|
|
|
|
Interest receivable on cash and cash equivalents |
1,953 |
373 |
|
Unwinding of the discount on royalty payments receivable |
219 |
105 |
|
Finance income |
2,172 |
478 |
|
|
|
|
|
Interest expense for lease liabilities |
(175) |
(246) |
|
Finance expense |
(175) |
(246) |
|
Net finance income |
1,997 |
232 |
7. Taxation
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Current tax |
|
|
|
UK corporation tax at current rates on UK profits for the year |
5,009 |
3,096 |
|
Adjustments in respect of previous years |
394 |
(54) |
|
|
5,403 |
3,042 |
|
Foreign tax |
1,568 |
1,291 |
|
Adjustments in respect of previous years |
(19) |
89 |
|
Total current tax |
6,952 |
4,422 |
|
Total deferred tax |
57 |
(1,105) |
|
Taxation from continuing operations |
7,009 |
3,317 |
Factors affecting the tax charge for the year:
The effective tax rate is higher (2023: lower) than the average rate of corporation tax in the UK of 25.0% (2023: 20.5%). The differences are explained below:
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Profit before tax |
24,208 |
20,492 |
|
Profit before tax multiplied by the average rate of corporation tax in the year of 25.0% (2023: 20.5%) |
6,052 |
4,200 |
|
Tax effects of: |
|
|
|
Impairment of goodwill |
1,109 |
- |
|
Gain on disposal of subsidiaries |
(1,367) |
(453) |
|
Foreign tax rate differences |
156 |
178 |
|
Adjustment in respect of previous years |
379 |
35 |
|
Other items not subject to tax |
623 |
462 |
|
Deferred tax UK intangibles and capital allowances movement |
(88) |
(904) |
|
Effect on deferred tax of a change in the corporation tax rate |
408 |
(83) |
|
Other deferred tax movements |
(263) |
(118) |
|
Taxation from continuing operations |
7,009 |
3,317 |
Deferred tax assets and liabilities are measured at the rates that are expected to apply in the periods of the reversal.
The Company's profits for this accounting year are taxed at an effective rate of 29.4% (2023: 16.2%).
The tax effect of adjusting items as disclosed in note 9 is an expense of £571,000 (2023: credit of £1,598,000).
8. Dividends
Amounts recognised as distributions to owners of the parent in the year:
|
|
Year ended 30 June 2024 Pence per share |
Year ended 30 June 2023 Pence per share |
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Final dividends recognised as distributions in the year |
7.3 |
5.8 |
6,473 |
5,091 |
|
Interim dividends recognised as distributions in the year |
3.0 |
2.7 |
2,680 |
2,371 |
|
Total dividends paid |
|
|
9,153 |
7,462 |
|
Final dividend proposed |
8.3 |
7.3 |
7,297 |
6,410 |
9. Earnings per share
Adjusted earnings per share has been calculated using adjusted earnings calculated as profit after taxation but before:
• impairment of goodwill;
• amortisation of intangible assets excluding computer software;
• adjusting items (included in operating expenses);
• other income - gain on disposal of subsidiaries; and
• other income - gain on disposal of property, plant and equipment and lease modification.
The calculation of the basic and diluted earnings per share is based on the following data:
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Continuing operations: |
|
|
|
Earnings from continuing operations for the purpose of basic earnings per share |
17,199 |
17,175 |
|
Add/(remove): |
|
|
|
Impairment of goodwill |
4,434 |
- |
|
Amortisation of intangible assets excluding computer software |
2,090 |
1,078 |
|
Adjusting items (included in operating expenses) |
598 |
147 |
|
Other income - gain on disposal of subsidiaries |
(5,465) |
(2,212) |
|
Other income - gain on disposal of property, plant and equipment and lease modification |
(2,189) |
- |
|
Tax effect of adjustments above and deferred tax |
571 |
(1,598) |
|
Adjusted earnings for the purposes of adjusted earnings per share |
17,238 |
14,590 |
|
|
|
|
|
Continuing and discontinued operations: |
|
|
|
Earnings from total operations for the purpose of basic earnings per share |
41,210 |
20,195 |
|
Add/(remove): |
|
|
|
Impairment of goodwill |
4,434 |
- |
|
Amortisation of intangible assets excluding computer software |
2,637 |
2,381 |
|
Adjusting items (included in operating expenses) |
598 |
147 |
|
Other income - gain on disposal of subsidiaries |
(26,831) |
(2,212) |
|
Other income - gain on disposal of property, plant and equipment and lease modification |
(2,189) |
- |
|
Tax effect of adjustments above and deferred tax |
571 |
(1,598) |
|
Adjusted earnings for the purposes of adjusted earnings per share |
20,430 |
18,913 |
|
|
2024 Number |
2023 Number |
|
Continuing operations: |
|
|
|
Weighted average number of ordinary shares for the purposes of basic and adjusted earnings per share |
88,964,817 |
88,027,119 |
|
Effect of dilutive potential ordinary shares: |
|
|
|
Future exercise of share awards and options |
1,722,761 |
2,217,174 |
|
Weighted average number of ordinary shares for the purposes of diluted and adjusted diluted earnings per share |
90,687,578 |
90,244,293 |
|
|
|
|
|
Continuing and discontinued operations: |
|
|
|
Weighted average number of ordinary shares for the purposes of basic and adjusted earnings per share |
88,964,817 |
88,027,119 |
|
Effect of dilutive potential ordinary shares: |
|
|
|
Future exercise of share awards and options |
1,722,761 |
2,217,174 |
|
Weighted average number of ordinary shares for the purposes of diluted and adjusted diluted earnings per share |
90,687,578 |
90,244,293 |
|
|
|
|
|
|
|
|
|
Continuing operations: |
|
|
|
Basic earnings per share |
19.33p |
19.51p |
|
Diluted earnings per share |
18.96p |
19.03p |
|
Adjusted basic earnings per share ('adjusted earnings per share') |
19.38p |
16.57p |
|
Adjusted diluted earnings per share |
19.01p |
16.17p |
|
|
|
|
|
Continuing and discontinued operations: |
|
|
|
Basic earnings per share |
46.32p |
22.94p |
|
Diluted earnings per share |
45.44p |
22.38p |
|
Adjusted basic earnings per share ('adjusted earnings per share') |
22.96p |
21.49p |
|
Adjusted diluted earnings per share |
22.53p |
20.96p |
10. Acquisition of Astutis
On 23 November 2023, the Group acquired 100% of the issued share capital of Astutis Limited ("Astutis"), a Company based in the United Kingdom, for an initial consideration of £16.8m. In addition, under the terms of the acquisition, there are two potential deferred payments totalling up to £4.7m based on Astutis' performance in each of the two years ending 30 June 2025 and 30 June 2026. As the deferred payments are linked to employment, they will be recognised as a separate transaction in each period respectively as they fall due.
Astutis, which offers training for a range of globally recognised and regulated health, safety and environmental qualifications, strengthens Wilmington's portfolio of GRC training and education solutions by expanding its capabilities into the health, safety and environmental markets. The acquisition is part of Wilmington's strategy to focus on consolidating its already strong presence in the large, growing and rapidly evolving GRC markets. These markets are underpinned by strong macro drivers, particularly the increasing volume and enforcement of regulation, complex geopolitical landscape, increased importance of ESG and widespread adoption of technological and data-driven compliance solutions. Goodwill acquired relates to synergies and access to the health, safety and environmental markets.
The fair value of the net assets acquired in the business at acquisition date was £9.0m, resulting in goodwill on acquisition of £11.2m. Acquisition related charges include transaction costs of £0.6m relating to the acquisition of Astutis. The results of the acquisition included in the Group's consolidated results are revenue of £4.8m and an operating result of £1.2m. Due to limitations in available data for the pre-acquisition period, the Directors consider that it is impracticable to disclose the results of the combined entity as though the acquisition had impacted the Group's consolidated results for the full year. The goodwill recognised is not deductible for tax purposes.
A summary of the acquisition is detailed below:
|
|
£'000 |
|
Fair value of net assets acquired |
|
|
Intangibles |
9,861 |
|
Property, plant and equipment |
336 |
|
Trade and other receivables |
1,880 |
|
Cash and cash equivalents |
4,207 |
|
Trade and other payables |
(4,510) |
|
Current tax liability |
(494) |
|
Deferred tax liability |
(1,995) |
|
Lease liability |
(311) |
|
Net assets acquired |
8,974 |
|
Goodwill |
11,156 |
|
Final working capital adjustments |
(1,174) |
|
Total cash consideration |
18,956 |
|
Final working capital adjustments paid in cash |
1,174 |
|
Cash acquired |
(4,207) |
|
Total cash outflow |
15,923 |
11. Disposals, disposal group held for sale and discontinued operations
Disposal of MiExact
On 31 January 2024 the Group disposed of its mortality data business, MiExact Limited, for consideration of £9.6m prior to working capital adjustments and recognised a gain on disposal of £5.9m presented within other income.
Wilmington received cash of £6.9m on completion after working capital adjustments, and the remaining £3.0m was issued as a loan note with a 7% coupon, deferred for up to three years.
The disposal was executed by way of the sale of 100% of the equity shares. Net assets on disposal were £2.9m, a breakdown can be found in the table below.
MiExact has not been classified as a discontinued operation under IFRS 5 because it does not meet the IFRS 5 criteria as a significant line of business.
Disposal of APM (part of the European Healthcare business)
On 26 April 2024 the Group disposed of its French Healthcare business, APM, for consideration of €26.0m (£22.3m) in cash, prior to working capital adjustments and recognised a gain on disposal of €23.3m (£19.9m) presented within discontinued operations.
The disposal was executed by way of the sale of 100% of the equity shares. Net assets on disposal were £1.9m, a breakdown can be found in the table below.
The European Healthcare business, consisting of APM and UK Healthcare, has been classified as a discontinued operation under IFRS 5 because it meets the IFRS 5 criteria as a significant line of business. Please see below for further information.
Disposal of UK Healthcare (part of the European Healthcare business)
On 27 June 2024 the Group disposed of its UK Healthcare business for consideration of up to £26.3m. The UK Healthcare business includes the entire issued share capital of Wilmington Healthcare Limited and Interactive Medica SL. This transaction completes Wilmington's sale of its European Healthcare businesses, following the disposal of the Group's French Healthcare business, APM, announced on 26 April 2024 for €26m.
The initial consideration of £21.3m comprises £4.8m in cash with the balance of £16.5m satisfied through the issue by the purchaser of secured loan notes for a term of up to four years, carrying a variable interest rate equal to the Bank of England base rate with some principal repayments throughout the term. The transaction realised a gain on disposal of £1.5m presented within discontinued operations.
The total consideration of £21.3m will increase by up to approximately £5.1m, subject to the UK Healthcare business achieving certain EBITDA targets for the financial year ending 30 June 2025. This contingent consideration has not been recognised as part of consideration because of the assessed likelihood of meeting the specified targets.
The disposal was executed by way of the sale of 100% of the equity shares. Net assets on disposal were £15.2m, a breakdown can be found in the table below.
The European Healthcare business, consisting of APM and UK Healthcare, has been classified as a discontinued operation under IFRS 5 because it meets the IFRS 5 criteria as a significant line of business. Please see below for further information.
Revision of ICP
The disposal proceeds for the 2018 disposal of ICP were renegotiated to ensure payment would actually be received, resulting in a reduction in the profit on disposal of £414,000 presented within other income.
Net assets as at the disposal dates:
The disposals were executed by way of the sale of 100% of the equity shares and as at each disposal date, the net assets were as follows:
|
|
MiExact £'000 |
APM £'000 |
UK Healthcare £'000 |
ICP £'000 |
Total £'000 |
|
Goodwill |
2,391 |
- |
11,885 |
|
|
|
Intangibles |
- |
89 |
1,734 |
|
|
|
Property, plant and equipment |
13 |
1,435 |
3 |
|
|
|
Deferred tax asset |
- |
- |
33 |
|
|
|
Current tax asset |
- |
392 |
95 |
|
|
|
Trade and other receivables |
898 |
2,195 |
5,114 |
|
|
|
Cash and cash equivalents |
1,038 |
4,141 |
2,942 |
|
|
|
Trade and other payables |
(1,414) |
(5,017) |
(6,654) |
|
|
|
Lease liabilities |
- |
(1,300) |
- |
|
|
|
Net assets disposed |
2,926 |
1,935 |
15,152 |
|
20,013 |
|
Directly attributable costs of disposal |
638 |
1,104 |
1,618 |
|
3,360 |
|
Recycling of foreign exchange (gain)/loss |
- |
25 |
(262) |
|
(237) |
|
Gain on disposal included within discontinued operations |
- |
19,912 |
1,454 |
|
21,366 |
|
Gain/(loss) on disposal included within other income |
5,879 |
- |
- |
(414) |
5,465 |
|
Fair value of consideration during the year |
9,443 |
22,976 |
17,962 |
(414) |
49,967 |
|
|
|
|
|
|
|
|
Satisfied by: |
|
|
|
|
|
|
Cash and cash equivalents |
6,894 |
22,976 |
4,812 |
|
34,682 |
|
Fair value of deferred consideration |
2,549 |
- |
13,150 |
(414) |
15,285 |
|
|
9,443 |
22,976 |
17,962 |
(414) |
49,967 |
|
Cash received |
6,894 |
22,976 |
4,812 |
|
34,682 |
|
Less cash disposed |
(1,038) |
(4,141) |
(2,942) |
|
(8,121) |
|
Total cash inflow |
5,856 |
18,835 |
1,870 |
|
26,561 |
The disposals reflect the Group's continued and active management of its portfolio to assess the potential of each business to exhibit the six common Wilmington characteristics that we recognise as key drivers of organic revenue growth and profitability improvement.
European Healthcare business (UK Healthcare & APM) classified as a discontinued operation
The European Healthcare business (consisting of APM and UK Healthcare) has been classified as a discontinued operation in the year with the financial results, including the comparatives, presented separately. The operation meets the IFRS 5 definition as a discontinued operation due to it being a separate major line of business and part of single coordinated disposal plan.
The table below shows the results of the discontinued operation, which is included separately in the Consolidated Income Statement.
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
European Healthcare |
|
|
|
Revenue |
27,679 |
30,432 |
|
Operating expenses before amortisation of intangibles excluding computer software |
(23,805) |
(25,599) |
|
Amortisation of intangible assets excluding computer software |
(547) |
(1,303) |
|
Operating expenses |
(24,352) |
(26,902) |
|
Operating profit |
3,327 |
3,530 |
|
Profit before tax |
3,327 |
3,530 |
|
Taxation |
(682) |
(510) |
|
Profit after tax |
2,645 |
3,020 |
|
Gain on disposal |
21,366 |
- |
|
Profit after tax from discontinued operations |
24,011 |
3,020 |
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
European Healthcare |
|
|
|
Net cash generated from operating activities |
208 |
4,070 |
|
Net cash used in investing activities |
20,574 |
(164) |
|
Net cash used in financing activities |
(151) |
(176) |
|
Net increase in cash & cash equivalents |
20,631 |
3,730 |
Compliance Week classified as a disposal group held for sale
During the year, the Compliance Week businesses, has been classified as a disposal group held for sale under IFRS 5.
The Group is focused on actively managing our portfolio by assessing the potential of each business to exhibit the six common Wilmington characteristics that we recognise as key drivers of organic revenue growth and profitability improvement. Consequently, as a result of this assessment, the Board decided to exit the Compliance Week business. The disposal is expected to be completed within one year by sale of equity shares.
The major classes of assets and liabilities comprising the disposal group held for sale are as follows:
|
|
30 June 2024 £'000 |
|
Goodwill |
358 |
|
Trade and other receivables |
545 |
|
Cash and cash equivalents |
293 |
|
Assets of disposal group held for sale |
1,196 |
|
|
|
|
Trade and other payables |
486 |
|
Liabilities of disposal group held for sale |
486 |
Compliance Week has not been classified as a discontinued operation under IFRS 5 because it does not meet the IFRS 5 criteria as a significant line of business.
12. Trade and other receivables
|
|
30 June 2024 £'000 |
30 June 2023 £'000 |
|
Current |
|
|
|
Trade receivables |
16,104 |
22,577 |
|
Prepayments and other receivables |
3,712 |
3,758 |
|
Contract assets |
523 |
1,056 |
|
|
20,339 |
27,391 |
Amounts due from all subsidiaries are interest free, unsecured and repayable on demand with the intention to repay within the year. Expected credit losses on amounts due from subsidiaries are immaterial.
13. Trade and other payables
|
|
30 June 2024 £'000 |
30 June 2023 £'000 |
|
Trade payables |
5,021 |
3,039 |
|
Social security and other taxes |
2,353 |
3,418 |
|
Accruals |
14,499 |
15,425 |
|
Contract liabilities |
27,887 |
33,659 |
|
Other payables |
700 |
425 |
|
|
50,460 |
55,966 |
Amounts due to subsidiaries are interest free, unsecured and repayable on demand.
14. Cash generated from operations
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
From continuing and discontinued operations: |
|
|
|
Profit before tax from continuing operations |
24,208 |
20,492 |
|
Profit before tax from discontinued operations |
24,694 |
3,530 |
|
Adjusting item - gain on disposal of subsidiaries included in continuing operations |
(5,465) |
(2,212) |
|
Adjusting item - gain on disposal of subsidiaries included in discontinued operations |
(21,367) |
- |
|
Adjusting item - gain on sale of property, plant and equipment and lease modification (see note 5a) |
(2,189) |
- |
|
Adjusting items |
598 |
147 |
|
Depreciation of property, plant and equipment included in operating expenses |
1,851 |
2,321 |
|
Amortisation of intangible assets (continuing and discontinued) |
3,662 |
4,071 |
|
Impairment of goodwill |
4,434 |
- |
|
Non-adjusting profit on disposal of property, plant and equipment |
- |
(36) |
|
Share based payments (including social security costs) |
1,865 |
1,515 |
|
Net finance income |
(1,997) |
(232) |
|
Operating cash flows before movements in working capital |
30,294 |
29,596 |
|
Increase in trade and other receivables |
(2,784) |
(107) |
|
Increase in trade and other payables |
2,545 |
4,023 |
|
Decrease in provisions |
(308) |
(307) |
|
Cash generated from operations before adjusting items |
29,747 |
33,205 |
Cash conversion is calculated as a percentage of cash generated by operations to adjusted EBITA as follows:
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
From continuing and discontinued operations: |
|
|
|
Funds from operations before adjusting items: |
|
|
|
Adjusted EBITA from continuing operations (note 3) |
21,679 |
19,273 |
|
Adjusted EBITA from discontinued operations |
3,874 |
4,833 |
|
Share based payments (including social security costs) |
1,865 |
1,515 |
|
Amortisation of intangible assets - computer software (continuing and discontinued) |
1,025 |
1,690 |
|
Depreciation of property, plant and equipment (continuing and discontinued) |
1,851 |
2,321 |
|
Non-adjusting profit on disposal of property, plant and equipment |
- |
(36) |
|
Operating cash flows before movement in working capital |
30,294 |
29,596 |
|
Net working capital movement |
(547) |
3,609 |
|
Funds from operations before adjusting items |
29,747 |
33,205 |
|
Cash conversion |
116% |
138% |
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Free cash flow: |
|
|
|
Operating cash flows before movement in working capital |
30,294 |
29,596 |
|
Proceeds on disposal of property, plant and equipment |
884 |
13 |
|
Net working capital movement |
(547) |
3,609 |
|
Interest received |
1,946 |
344 |
|
Payment of lease liabilities |
(881) |
(2,109) |
|
Tax paid |
(7,115) |
(3,268) |
|
Purchase of property, plant and equipment |
(132) |
(461) |
|
Purchase of intangible assets |
(235) |
(595) |
|
Free cash flow |
24,214 |
27,129 |
15. Reconciliation of net cash movements
|
|
|
Year ended 30 June 2024 £'000 |
Year ended 30 June 2023 £'000 |
|
Cash and cash equivalents at beginning of the year |
|
42,173 |
19,785 |
|
Cash classified as held for sale |
|
- |
758 |
|
Lease liabilities at beginning of the year |
|
(7,210) |
(7,510) |
|
Net cash at beginning of the year |
|
34,963 |
13,033 |
|
Net increase in cash and cash equivalents |
|
25,635 |
21,630 |
|
Movement in lease liabilities |
|
4,382 |
300 |
|
Cash and cash equivalents at end of the year |
|
67,515 |
42,173 |
|
Cash classified as held for sale at end of the year |
|
293 |
- |
|
Lease liabilities at end of the year |
|
(2,828) |
(7,210) |
|
Net cash at end of the year |
|
64,980 |
34,963 |
16. Events after the reporting period
There were no events after the balance sheet date that require disclosure.
[1] Ongoing - eliminating the effects of the impact of disposals, closures and businesses held for sale; Organic - Ongoing, eliminating acquisitions and exchange rate fluctuations.
[2] Ongoing adjusted profit before tax and total adjusted profit before tax - see note 3.
[3] Ongoing adjusted basic earnings per share; Adjusted basic earnings per share - see note 9.
[4] Net cash includes cash and cash equivalents, bank loans (excluding capitalised loan arrangement fees) and bank overdrafts but excludes lease liabilities.
[5] Ongoing - eliminating the effects of the impact of disposals, closures and businesses held for sale; Organic - Ongoing, eliminating acquisitions and exchange rate fluctuations.
[6] The HSE division consists of the Astutis business.
[7] The Legal division consists of the Bond Solon and Pendragon businesses.
[8] The Financial Services division consists of Axco & FRA in the Insurance subdivision and Mercia, CLTi & the ICA businesses within the Other subdivision.
[9] Total revenue & operating profit includes all results in the Group including non-core businesses consisting of MiExact, Compliance Week, Healthcare, APM, ICA Singapore & Malaysia. Non-core in FY23 also includes Inese.
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