TIDMAQSG
RNS Number : 6394E
Aquila Services Group PLC
03 July 2023
For immediate release 3 July 2023
Aquila Services Group plc
("Aquila", the "Company" or the "Group")
Annual report and financial statements
for the year ended 31 March 2023
and
Notice of AGM
Annual report
Aquila is pleased to announce its audited annual report and
financial statements for the year ended 31 March 2023, extracts
from which are set out below.
The Company's annual report and financial statements for the
year ended 31 March 2023 will shortly be made available from the
Company's website at: http://www.aquilaservicesgroup.co.uk/ .
In addition, the document will be uploaded to the National
Storage Mechanism and will be available for viewing shortly at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
Financial Highlights
For the year ended 31 March 2023
Revenue Gross profit Gross profit margin
GBP12,249k GBP2,605k 21%
(2022: GBP10,119k) (2022: GBP2,206k) (2022: 22%)
Underlying operating Statutory profit Statutory earnings per
profit* after tax share
GBP806k GBP518k 1.29p
(2022: GBP726K) (2022: GBP579k) (2022: 1.45p)
------------------- -----------------------
Cash generated by Cash balances Total dividend payable
operations. GBP2,405k 0.75p per share
GBP719k (2022: GBP2,193k) (2022: 0.6p)
(2022: GBP512k)
------------------- -----------------------
* Underlying operating profit is calculated by adjusting the
reported pre-tax profit for share-based payment charges and
impairments of goodwill.
Dividend
The Directors propose a final dividend of 0.5p per share (2022:
0.4p). This will be paid on 2 August 2023 to shareholders on the
register at 14 July 2023.
Notice of Annual General Meeting ("AGM")
The Company's AGM will be held at Tempus Wharf 29A, Bermondsey
Wall West, London, SE16 4SA on 26 July 2023 at 12:00 midday.
The financial information set out below does not constitute the
Company's statutory accounts for the period ending 31 March 2023.
The financial information for 2022 is derived from the statutory
accounts for that year. The auditors, Crowe U.K. LLP, have reported
on the 2023 accounts. Their report was unqualified and did not
include a reference to any matters to which the auditors draw
attention by way of emphasis without qualifying their report.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018.
For further information please visit
www.aquilaservicesgroup.co.uk or contact:
Aquila Services Group plc
Claire Banks, Group Finance Director
Tel: 020 7934 0175
Beaumont Cornish Limited, Financial Adviser
Roland Cornish / Asia Szusciak
Tel: 020 7628 3396
Extracts from the Company's annual report and financial
statements for the year ended 31 March 2023
Chairs statement
Dear Shareholder,
I am pleased to present the Annual Report and Financial
Statements for the year to 31 March 2023. The report is designed to
provide both an overview of the Group's business and achievements
as well as a summary of the results for the year. I trust that
shareholders will find the information both helpful and informative
as well as giving them the confidence that the company works on
behalf of the public good, is progressive and is confident about
future growth. If you would like further information or wish to
discuss the work of the Group, please do not hesitate to contact
one of the directors, details are given on page 2.
Aquila Services Group plc ('the Company') is the holding company
for Altair Consultancy and Advisory Services Ltd ('Altair'), Aquila
Treasury & Financial Solutions Ltd ('ATFS') and Oaks
Consultancy ('Oaks') which form the Group ('the Group').
The Group is an independent consultancy which provides advice
and support to organisations both in the private and public sector
that develop and manage affordable housing, provide education and
sports opportunities as well as to organisations active in the
charity and community sectors. Most clients operate within the
United Kingdom but increasingly our services are in demand to
support the provision of affordable housing and community services,
particularly in Africa and Asia, where our initiatives are funded
by International Agencies.
My statement at the interim stage reflected that the easing of
restrictions from the pandemic and economic life returning to
normal was an opportunity for the Group to expand its business.
This growth has continued with turnover for the year 21% higher
than for the previous equivalent 12 months.
The main driver of growth had been through the affordable
housing client base. This has continued together with an upward
trajectory in the sports, communities and charity sectors.
Education has lagged behind, waiting for procedures to be created
to complement government announcements on capital allocations.
Wage inflation and skills shortages are still a significant
upward pressure on our cost base so that profit growth lags behind
the increase in turnover. Despite this, the Group has achieved
record operating and gross annual profits.
Group results for the financial year ended 31 March 2023 are a
turnover of GBP12,249 (2022: GBP10,119), an increase of 21%;
underlying operational profit of GBP806k (2022: GBP726k), up by 8%;
and profit after tax of GBP518k (2022: GBP579k), decreased by
12%.
In line with the Financial Reporting Standards the Group
accepted an impairment charge of GBP120k on the carrying value of
the investment in ATFS which had previously a significant
proportion of its business from the education sector.
The Directors recommend a final dividend of 0.5p (2022: 0.4p)
which would total dividends for the year of 0.75p (2022: 0.6p), an
increase of 25%.
The new financial year has started with some encouraging signs,
particularly in the affordable housing sector both in the UK and
with international clients. There is every expectation that growth
will continue in the sports, community and charity sectors. We are
still awaiting the necessary clarification on the authorities
needed for capital spending by educational bodies. The evidence for
this continuing growth is the number of enquiries being received
and the increasing value of new business being won. This will again
put pressure on our staff resources and the requirement for
increased investment in skills and training. The pressures on the
cost base that is reflected in the published accounts is likely to
continue and, with labour market changes, is likely to be a
permanent feature.
During the year we have streamlined our executive structure to
ensure that our investment in skills and training is protected by
more defined career paths for staff. It has also been a further
opportunity to ensure that we have a succession strategy for all
the key posts.
The services the business offers relate to the essential needs
of people of all ages living in a developed economy. The pandemic
demonstrated that this is not in itself a protection against the
threats of an increasingly unstable and fragile geopolitical and
economic environment. At any time, we need to have the optimum
organisation of our staff and the IT that services them. We need
the goodwill of our clients as well as the financial resources to
cover fiscal shocks. We believe these are all now substantially in
place and we continue to review and update to ensure the resilience
of the business.
We all have an ongoing responsibility to the society and world
in which we live. We take this seriously and we have now combined
our EDI and Green Groups into a new employee body focussing on ESG.
They review and have input into our policies to ensure that both
our recruitment and our opportunities are open to all, that we
minimise our carbon footprint and treat everyone with the dignity
they have a right to expect, and we are sensitive to individual
needs. We want all those who work within the business to feel
welcome, valued and treated with respect.
Recent years and especially since the pandemic have seen
reducing levels of interest in smaller quoted companies listed on
the main market of the London Stock Exchange (LSE). At the same
time the cost of maintaining a listing is significant and
regulatory changes are increasing costs as a proportion of the
Group's total revenues. In the Board's view the increasing
profitability of the Group, the increases in dividends payable and
financial strength has not been reflected in either the share price
or market liquidity.
The FCA has recently announced some changes they are proposing
to make, which when implemented may have an impact on the costs of
maintaining a listing. As and when these changes are known, the
Board will assess the implications for the Company.
There is a long list of people who work for us and those with
whom we work that I would want to thank for their commitment, hard
work and good humour throughout the year. The business provides
services that enhance people's quality of life. This should not
mean that working for the business is not also enjoyable as well as
fulfilling. I know that all the members of the board including
myself have enjoyed making our contribution during the 12 months
and we look forward to this continuing and reporting further
progress to shareholders at the interim stage of the new financial
year. Finally, I must pay tribute to our Chief Executive Officer,
Fiona Underwood. Without her leadership, management and
communication skills, as well as dedication and hard work, little
of the successes of the year would have been possible.
Derek Joseph - Chair
30 June 2023
Extract from the Strategic Report
Strategy and objectives
Aquila Services Group (Aquila) has a bold purpose to 'make a
better, more sustainable and socially responsible world'. We
achieve this by being a consultancy group which provides
professional support services to socially focused sectors in the UK
and internationally.
Our purpose is core to what we want to be across the group:
-- We want our subsidiaries to have a direct beneficial impact
on communities and lives in the UK and beyond.
-- We want to offer staff the opportunity to inspire positive
change in an environment with a strong social focus.
-- And we want to provide investors the opportunity of
supporting an organisation that combines strong performance with a
positive social outcome.
Our work helps our clients to develop a response to a changing
world and make a positive difference to the communities in which
they operate. At present we work with clients across housing and
regeneration, sport and education, charity and government sectors.
We work across the UK and increasingly internationally.
Our business as at 31 March 202 3
Aquila delivers work to clients through key subsidiaries, each
of which has a core market and service focus:
-- Altair provides support for affordable housing and government
bodies through the development, growth, management, governance, and
operation of organisations, and the improvement of services to
affordable and social housing customers.
-- ATFS is registered with the Financial Conduct Authority and
provides advice to the affordable housing and education sectors on
treasury and funding solutions.
-- Oaks works with clients in the sport, charity and education
sectors focused on strategy, business planning and income
generation activities.
The Group had two employee led groups with representation across
the Aquila Group. The aim was to focus activities on the
environment and sustainability, equality, diversity and inclusion
and promoting these initiatives amongst colleagues, making Aquila
an attractive employer to work for.
In October 2022 the Group agreed to combine the work of the
Green and EDI groups and create a smaller team focussed on the
Environment, Social and Governance (ESG) agenda. The ESG group
meets monthly and its purpose is to drive the ESG agenda across the
Group and its subsidiaries.
Further information about, and activities within the groups, is
available on the website.
Principal risks and uncertainties
The principal risks currently faced by the Group are:
Financial risk
The main financial risks arising from the Group's activities are
credit risk, foreign currency risk, interest rate risk and
liquidity, details of which can be found in note 23 to the
Financial Statements.
Unfavourable economic conditions and/or changes to government
policy
The current macro-economic uncertainty, rising interest rates
and high inflation may see a reduction in business as clients
spending on consultancy is curtailed. Local authorities continue to
see significant pressure on budgets and may stop consultancy
contracts and/or limit their commissioning of work.
The Group mitigates these risks by ensuring that each subsidiary
has diversity across its client base, not relying on any one client
or group of clients.
Changes to government policy may adversely affect the Group. The
Group ensures that it is aware of the impact of these changes and
adapts its products and services to proactively respond to this
risk.
Competition
Increased competition in the market continues to pose a risk to
all companies within the Group.
Staff skills, retention, recruitment and succession
As the Group is a people-based business, a significant risk is
the recruitment and retention of talent. The Group continues to
monitor retention and all staff leaving the business have exit
interviews which provides important input into our People policies
to improve our working practices and environment.
Data governance
The increase of cyber-attacks and the loss of data is a serious
risk that is monitored closely. The Group complies with all
relevant legislation and has invested in updated systems, security
and training. The Group obtained the certification of Cyber
Essentials Plus status during the year.
Mitigations of risk
The Group seeks to mitigate all these risks through ensuring
that it monitors changes in statutory, regulatory and financial
requirements and maintains good relationships with its clients,
principal contacts within government, regulators and other key
influencers within the sector.
The Group is well placed to provide the full range of services
needed by its clients as the external environment changes. Our
international work will continue to be impacted due to
international travel restrictions. It is hoped these will further
ease during the year.
Environment
The Group undertakes regular risk assessments, scenario
analysis, and stress testing to identify, measure, and manage
climate risks across all operations, supply chains, and investment
portfolio. Risks are managed on a case-by-case basis and are
considered during the business planning process.
Aquila has again achieved Carbon Neutral Plus status within the
year.
Further information is on the website.
Corporate and social responsibility
The Group recognises that we have a responsibility to ensure the
impact of our business is positive. The Group's Corporate Social
Responsibility policy can be seen on the website .
The Group has adopted policies to ensure that in all work across
the Group and its subsidiaries the impact of human rights,
anti-corruption and anti-bribery matters are considered.
The Group continues to support programmes, on a pro-bono basis
that are aimed at improving the opportunities for individuals from
a minority ethnic background and to increase the diversity of
housing sector leaders. In March this year we joined the Future of
London Emerging Talent Programme, providing a placement opportunity
for individuals from a minority ethnic background. Our involvement
will span three financial years.
Our subsidiary Oaks supports WAITS as its charity partner.
Through this relationship the Oaks team provide pro bono support
with strategy and business planning together with income
generation.
As part of the work of the ESG Group there is a project to
increase our CSR work and provide opportunities for more colleagues
to be involved.
Statement of Directors Responsibilities in respect of the Annual
Report and the Financial Statements
The directors (whose names and functions are set out on page 26)
are responsible for preparing this report and the financial
statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial
statements for each financial year. Under that law the directors
have prepared the Company and Group financial statements in
accordance with UK Adopted International accounting standards in
conformity with the requirements of the Companies Act 2006. Under
company law, the directors must not approve the financial
statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Company and the Group and the
profit or loss of the Company and the Group for that period.
In preparing the Company and Group financial statements, the
directors are required to:
-- select suitable accounting policies and then apply them
consistently;
-- make judgements and estimates that are reasonable relevant
and reliable;
-- present information, including accounting policies, in a
manner that provides relevant, reliable, comparable and
understandable information;
-- State whether they have been prepared in accordance with
UK-adopted international accounting standards in conformity with
the requirements of the Companies Act 2006;
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company and Group
will continue in business; and
-- Use the going concern basis of accounting unless they either
intend to liquidate the Group or the Company or cease operations or
have no realistic alternative but to do so.
The Directors are responsible for maintaining adequate
accounting records that are sufficient to show and explain the
Company's transactions and disclose with reasonable accuracy at any
time the financial position of the Company and enable them to
ensure that the financial statements comply with the Companies Act
2006.
The directors are responsible for such internal controls as they
determine are necessary to enable the preparation of financial
statements that are free from material misstatement. Whether due to
fraud or error. and have general responsibility for taking such
steps as are reasonably open to them to safeguard the assets of the
Group and to prevent and detect fraud and other irregularities.
Under applicable law and regulations. the Directors are also
responsible for preparing a Strategic Report. Directors' Report and
Corporate Governance Report that comply with that law and those
regulations.
The Directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
Company's website. Legislation in the UK governing the preparation
and dissemination of financial statements may differ from
legislation in other jurisdictions.
Responsibility statement of the Directors in respect of the
Annual Report and Financial Statements
We confirm that to the best of our knowledge:
-- the Company and Group financial statements, which have been
prepared in accordance with the applicable set of accounting
standards, give a true and fair view of the assets, liabilities,
financial position and profit or loss of the Company and the
undertakings included in the consolidation taken as a whole;
and
-- the Strategic Report and Directors' Report include a fair
review of the development and performance of the business and the
position of the Group and the undertakings included in the
consolidation taken as a whole. together with a description of the
principal risks and uncertainties that they face.
We consider the Annual Report and Financial Statements, taken as
a whole, is fair, balanced and understandable and provides the
information necessary for shareholders to assess the Group's
position and performance, business model and strategy.
Claire Banks - Group Finance Director
On behalf of the Board
30 June 2023
Consolidated statement of comprehensive income
For the year ended 31 March 2023
Notes 2023 2022
GBP'000 GBP'000
Revenue 4 12,249 10,119
Cost of sales 5 (9,644) (7,913)
-------- --------
Gross profit 2,605 2,206
Administrative expenses 5 (1,828) (1,488)
Operating profit 777 718
Finance income 4 17 -
Impairment of Goodwill 10 (120) -
Profit before taxation 6 674 718
Income tax expense 8 (156) (139)
-------- --------
Profit for the year 518 579
Other comprehensive income - -
-------- --------
Total comprehensive income for
the year 518 579
========
Earnings per share attributable
to owners of the parent
Basic 9 1.29p 1.45p
Diluted 9 1.26p 1.41p
The income statement has been prepared on the basis that all
operations are continuing operations.
Consolidated statement of financial position
As at 31 March 2023
Group Group
2023 2022
Notes GBP'000 GBP'000
Non-current assets
Goodwill 10 3,197 3,317
Property, plant and equipment 11 234 313
Investments 13 71 71
--------
3,502 3,701
Current assets
Trade and other receivables 14 3,130 2,593
Cash and bank balances 2,405 2,193
--------
5,535 4,786
-------- --------
Current liabilities
Trade and other payables 15 2,260 1,917
Lease liabilities 16 69 88
Corporation tax 170 144
--------
2,499 2,149
-------- --------
Net current assets 3,036 2,637
-------- --------
Non-current lease liabilities 16 126 196
Net assets 6,412 6,142
======== ========
Equity
Share capital 17 1,998 1,998
Share premium account 17 1,712 1,712
Merger reserve 17 3,042 3,042
Share-based payment reserve 20 364 415
Retained losses (704) (1,025)
-------- --------
Equity attributable to the
owners of the parent 6,412 6,142
======== ========
The financial statements were approved by the board and
authorised for issue on 30 June 2023 .
Claire Banks - Group Finance Director
Company statement of financial position
As at 31 March 2023
Company Company
2023 2022
Notes GBP'000 GBP'000
Non-current assets
Property, plant and equipment 11 12 3
Investment in subsidiaries 12 4,072 4,180
Investments 13 71 71
--------
4,155 4,254
Current assets
Trade and other receivables 14 236 991
Cash and bank balances 1,052 89
--------
1,288 1,080
-------- --------
Current liabilities
Trade and other payables 15 694 440
694 440
-------- --------
Net current assets 594 640
Net assets 4,749 4,894
======== ========
Equity
Share capital 17 1,998 1,998
Share premium account 17 2,341 2,341
Share-based payment reserve 20 364 415
Retained earnings 46 140
-------- --------
Equity attributable to the
owners of the parent 4,749 4,894
======== ========
As permitted by S408 Companies Act 2006, the company has not
presented its own profit and loss account. The company's profit for
the year was GBP103k (2022: loss GBP441k).
The financial statements were approved by the board and
authorised for issue on 30 June 2023.
Claire Banks - Group Finance Director
Company Registration No. 08988813
Consolidated statement of changes in equity
For the year ended 31 March 2023
Share Share based
Share premium Merger payment Retained Total
capital account reserve reserve losses equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at
1 April 2021 1,998 1,712 3,042 580 (1,537) 5,795
Total comprehensive
income - - - - 579 579
Transfer on
reserves - - - (173) 173 -
Share based
payment charge - - - 8 - 8
Dividend - - - - (240) (240)
Balance at
31 March 2022 1,998 1,712 3,042 415 (1,025) 6,142
======== ======== ======== ============ ========= ========
Balance at
1 April 2022 1,998 1,712 3,042 415 (1,025) 6,142
Total comprehensive
income - - - - 518 518
Transfer on
reserves - - - (63) 63 -
Share based
payment charge - - - 12 - 12
Dividend - - - - (260) (260)
-------- -------- -------- ------------ --------- --------
Balance at
31 March 2023 1,998 1,712 3,042 364 (704) 6,412
======== ======== ======== ============ ========= ========
Company statement of changes in equity
For the year ended 31 March 2023
Share Share based
Share premium payment Retained Total
capital account reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1
April 2021 1,998 2,341 580 648 5,567
Total comprehensive
income - - - (441) (441)
Transfer on reserves - - (173) 173 -
Share based payment
charge - - 8 - 8
Dividend - - - (240) (240)
Balance at 31
March 2022 1,998 2,341 415 140 4,894
======== ======== ============ ========= ========
Balance at 1
April 2022 1,998 2,341 415 140 4,894
Total comprehensive
income - - - 103 103
Transfer on reserves - - (63) 63 -
Share based payment
charge - - 12 - 12
Dividend - - - (260) (260)
-------- -------- ------------ --------- --------
Balance at 31
March 2023 1,998 2,341 364 46 4,749
======== ======== ============ ========= ========
Consolidated statement of cash flow
For the year ended 31 March 2023
2023 2022
GBP'000 GBP'000
Cash flows from operating activities
Profit for the year 518 579
Interest received (17) -
Income tax expense 156 139
Share based payment charge 12 8
Impairment of goodwill 120 -
Depreciation 124 118
-------- --------
Operating cash flows before movement in working
capital 913 844
(Increase)/Decrease in trade and other receivables (537) (320)
(Decrease)/Increase in trade and other payables 343 (12)
-------- --------
Cash generated by operations 719 512
Income taxes paid (130) (84)
-------- --------
Net cash inflow from operating activities 589 428
-------- --------
Cash flows from investing activities
Interest received 17 -
Purchase of property, plant and equipment (45) (37)
Net cash (outflow)/inflow from investing
activities (28) (37)
-------- --------
Cash flows from financing activities
Lease liability payments (89) (85)
Dividends paid (260) (240)
-------- --------
Net cash (outflow)/inflow from financing
activities (349) (325)
Net increase in cash and cash equivalents 212 66
Cash and cash equivalents at beginning of
the year 2,193 2,127
-------- --------
Cash and cash equivalents at end of the year 2,405 2,193
======== ========
Company statement of cash flow
For the year ended 31 March 2023
2023 2022
GBP'000 GBP'000
Cash flows from operating activities
Profit/(Loss) for the year 103 (441)
Interest received (17) -
Dividends received (977) (200)
Impairment of investment 120 -
Depreciation 6 -
Operating cash flows before movement in working
capital (765) (641)
Decrease/(Increase) in trade and other receivables 755 313
Increase/(Decrease) in trade and other payables 254 39
Cash (outflow) generated by operations 244 (289)
Net cash (outflow) from operating activities 244 (289)
-------- --------
Cash flows from investing activities
Interest on deposits 17 -
Purchase of plant and equipment (15) 3
Dividends received 977 200
Net cash (outflow)/inflow from investing
activities 979 203
-------- --------
Cash flows from financing activities
Dividends paid (260) (240)
Net cash (outflow) from financing activities (260) (240)
Net increase/(decrease) in cash and cash equivalents 963 (326)
Cash and cash equivalents at beginning of
the year 89 415
Cash and cash equivalents at end of the year 1,052 89
======== ========
Notes to the financial statements
For the year ended 31 March 2023
1 General information
Aquila Services Group plc ('the Company') and its subsidiaries
(together, 'the Group') provide specialist housing, sport,
education and treasury management consultancy services. The
principal activity of the Company is that of a holding company for
the Group as well as providing all the strategic and governance
functions of the Group.
The Company is a public limited company which is listed on the
London Stock Exchange, domiciled in the United Kingdom and
incorporated and registered in England and Wales. The Company's
registered office is Tempus Wharf, 29a Bermondsey Wall West,
London, SE16 4SA.
2 Accounting policies
The principal accounting policies applied in preparation of
these consolidated financial statements are set out below. These
policies have been consistently applied unless otherwise
stated.
Basis of preparation
The financial statements have been prepared in accordance with
International Accounting standards in conformity with the
requirements of the Companies Act 2006.
The financial statements have been prepared on the historical
cost basis except for certain assets which are carried at fair
value.
The financial statements are presented in Pounds Sterling which
is the functional and presentational currency of all companies
within the group.
The preparation of the financial statements in conformity with
IFRS requires the use of certain critical accounting estimates. It
also requires management to exercise its judgement in the process
of applying the Group's accounting policies. The areas of critical
accounting estimates and judgements are set out in note 3.
Going concern
The budgets and cashflow forecasts that have been produced and
reviewed demonstrate that the Group is forecast to generate profits
and cash in the year ended 31 March 2023 and beyond and that the
Group has sufficient cash reserves to enable the Group to meet its
obligations as they fall due for a period of at least 12 months
from the date of signing the financial statements.
Basis of consolidation
The consolidated financial statements incorporate the financial
statements of subsidiary entities. A subsidiary is defined as an
entity over which the Company has control. Control is achieved when
the Company has power over an entity, is exposed to, or has rights
to, variable returns from its involvement with the entity, and
could use its power to affect its returns.
Consolidation of a subsidiary begins when the Company obtains
control and ceases when control is lost. The Company reassesses
whether it controls an entity if facts and circumstances indicate
that there are changes to one or more of the three control elements
listed above.
All intragroup assets and liabilities, equity, income, expenses
and cash flows relating to transactions between members of the
Group are eliminated on consolidation.
Where necessary, adjustments are made to the financial
statements of subsidiaries to bring accounting policies used into
line with the Group's accounting policies.
Business combinations
Acquisitions of subsidiaries are accounted for using the
acquisition method. The consideration transferred in a business
combination is measured at fair value, which is calculated as the
sum of the acquisition date fair values of assets transferred by
the Group, liabilities incurred by the Group to the former owners
of the acquiree and the equity interest issued by the Group in
exchange for control of the acquiree.
Any excess of the consideration over the fair value of the
identifiable assets and liabilities acquired is recognised as
goodwill. Goodwill is not amortised but is reviewed for impairment
at least annually. If the consideration is less than the fair value
of the identifiable assets and liabilities acquired, the difference
is recognised in the statement of comprehensive income.
Revenue recognition
The group earns income from the following principal
services:
-- Revenue from consultancy services
-- Revenue from treasury management.
For all these principal services, revenue represents amounts
recoverable from clients for professional services provided during
the year. Revenue is measured based on the consideration to which
the Group expects to be entitled in a contract with a customer and
excludes amounts collected on behalf of third parties.
Revenue is recognised when control of a product or service is
transferred to a customer . A receivable is recognised when the
services are delivered as this is the point in time that the
consideration is unconditional because only the passage of time is
required before the payment is due.
Revenue from fixed fee assignments is recognised over a period
of time by reference to the stage of completion of the actual
services provided at the reporting date, as a proportion of the
total services to be provided because the customer receives and
uses the benefits simultaneously. This is determined based on the
actual labour hours spent relative to the total expected labour
hours.
Time and materials assignments are recognised as services are
provided at the fee rate agreed with the client. Unbilled revenue
on individual client assignments is classified as contract assets
for client work within trade and other receivables. Where
individual on-account billings exceed recognised revenue on a
client assignment, the excess is classified as contract liabilities
for client work within trade and other payables.
Property, plant and equipment
Property, plant and equipment are stated at cost less
accumulated depreciation and any recognised impairment loss. The
cost of an item of property, plant and equipment initially
recognised includes its purchase price and any cost that is
directly attributable to bringing the asset to the location and
condition necessary for use. Depreciation is recognised to
write-off the cost of assets less their residual values over their
estimated useful lives, using the straight-line method, on the
following bases:
Right of use assets Over unexpired term of lease
Leasehold improvements Over unexpired term of lease
Fixtures, fittings and equipment 3-4 years
The estimated useful lives, residual values and depreciation
method are reviewed at the end of each reporting period, with the
effect of any changes in estimate accounted for on a prospective
basis.
An item of property, plant and equipment is derecognised upon
disposal or when no future economic benefits are expected to arise
from the continued use of the asset. The gain or loss arising on
the disposal of an asset is determined as the difference between
the sales proceeds and the carrying amount of the asset and is
recognised in the statement of comprehensive income.
Investment in subsidiaries
In the Company's financial statements, investments in
subsidiaries are carried at cost less any accumulated
impairment.
The cost of an investment in a subsidiary is the aggregate of
the fair value, at the date of exchange, of assets given,
liabilities incurred or assumed, and equity instruments issued by
the Company, plus any costs directly attributable to the purchase
of the subsidiary.
Investments
Investments are held at fair value.
Financial instruments
Financial assets and financial liabilities are recognised on the
Group's Statement of Financial Position when the Group becomes a
party to the contractual provisions of the instrument.
Financial assets
Financial assets are classified into the following specified
categories: financial assets 'at fair value through profit or loss'
(FVTPL) and 'amortised cost'. The classification depends on the
financial asset's contractual cash flow characteristics and the
Group's business model for managing them and is determined at the
time of initial recognition. Financial assets with cash flows that
are not solely payments of principal and interest are classified
and measured at fair value through profit or loss, irrespective of
the business model.
Amortised cost
Financial assets at amortised cost
These assets are held within a business model whose objective is
to collect contractual cash flows which are solely payments of
principals and interest and therefore classified as subsequently
measured at amortised cost. With the exception of trade receivables
which are initially measured at transaction price determined in
accordance with IFRS 15, financial assets at amortised cost are
initially recognised at fair value plus transaction costs that are
directly attributable to their acquisition and are subsequently
carried at amortised cost using the effective interest rate method,
less provision for impairment. The Group's financial assets
measured at amortised cost comprise trade and other receivables and
cash and cash equivalents. Cash comprises cash in hand and deposits
repayable on demand, less overdrafts payable on demand which have a
right of offset against cash balances. These instruments are
readily convertible to a known amount of cash and are subject to an
insignificant risk of change in value.
Financial assets at fair value through profit or loss
Assets that do not meet the criteria for amortised cost are
measured at FVTPL. A gain or loss on a debt investment that is
subsequently measured at FVTPL is recognised in profit or loss and
presented net within other gains/(losses) in the period in which it
arises. The Group's financial assets measured at FVTPL comprise
unquoted equity investments.
Impairment of financial assets
Impairment provisions for current trade receivables are
recognised based on the simplified approach within IFRS 9 using a
provision matrix in the determination of credit losses. During this
process the probability of the non-payment of the trade receivable
is assessed. This probability is then multiplied by the amount of
the expected loss arising from default to determine the expected
credit loss for the trade receivables. Provisions are recorded net
in a separate provision account with the loss being recognised in
the consolidated income statement. On confirmation that the trade
receivable will not be collectable, the gross carrying value of the
asset is written off against the associated provision. Impairment
provisions for receivables from related parties and loans to
related parties are recognised based on a forward-looking expected
credit loss model. The methodology used to determine the amount of
provision is based on whether there has been a significant increase
in credit risk since the initial recognition of the asset.
Financial liabilities and equity
Financial liabilities and equity instruments are classified
according to the substance of the contractual arrangements entered
into.
Equity instruments
An equity instrument is any contract that evidences a residual
interest in the assets of the Group after deducting all of its
liabilities. Equity instruments issued by the Group are recorded at
the proceeds received, net of direct issue costs.
Financial liabilities
Financial liabilities are classified as either financial
liabilities 'at FVTPL' or 'amortised cost'. The Group does not
currently hold any financial liabilities 'at FVTPL'.
Pensions
The Group contributes to defined contribution schemes for the
benefit of its directors and employees. Contributions payable are
charged to the statement of comprehensive income in the year they
are payable.
Current and deferred income tax
The tax expense represents the sum of the tax currently payable
and deferred tax.
The tax currently payable is based on taxable profit for the
year. Taxable profit differs from net profit as reported in the
profit or loss, because it excludes items of income or expense that
are taxable or deductible in other years and it further excludes
items that are never taxable or deductible. The Company's liability
for current tax is calculated using tax rates that have been
enacted or substantively enacted by the reporting date.
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amount of assets and liabilities
in the financial information and the corresponding tax bases used
in the computation of taxable profit and is accounted for using the
balance sheet liability method. Deferred tax liabilities are
recognised for all taxable temporary differences and deferred tax
assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible
temporary differences can be utilised. Such assets and liabilities
are not recognised if the temporary difference arises from the
initial recognition of goodwill or from the initial recognition
(other than in a business combination) of other assets and
liabilities in a transaction which affects neither the tax profit
nor the accounting profit.
Deferred tax is calculated at the tax rates that are expected to
apply to the year when the asset is realised, or the liability is
settled. Deferred tax is charged or credited in the profit or loss,
except when it relates to items credited or charged in other
comprehensive income directly to equity, in which case the deferred
tax is also dealt with in other comprehensive income.
Deferred tax assets
Management regularly assesses the likelihood that deferred tax
assets will be recovered from future taxable income. No deferred
tax asset is recognised when management believe that it is more
likely than not that a deferred asset will not be realised.
Impairment of non-financial assets
The Group assesses at each statement of financial position date
if there is any indication that an asset may be impaired. If any
such indication exists, the Group estimates the recoverable amount
of the asset.
If there is any indication that an asset may be impaired, the
recoverable amount is estimated for the individual asset. If it is
not possible to estimate the recoverable amount of the individual
asset, the recoverable amount of the cash-generating unit to which
the asset belongs is determined.
The recoverable amount of an asset or a cash-generating unit is
the higher of its fair value less costs to sell and its value in
use.
If the recoverable amount of an asset is less than its carrying
amount, the carrying amount of the asset is reduced to its
recoverable amount. That reduction is an impairment loss.
An impairment loss of assets carried at cost less any
accumulated depreciation or amortisation is recognised immediately
in profit or loss.
An entity assesses at each reporting date whether there is any
indication that an impairment loss recognised in prior periods for
assets other than goodwill may no longer exist or may have
decreased. If any such indication exists, the recoverable amounts
of those assets are estimated.
The increased carrying amount of an asset other than goodwill
attributable to a reversal of an impairment loss does not exceed
the carrying amount that would have been determined had no
impairment loss been recognised for the asset in prior periods.
A reversal of an impairment loss of assets carried at cost less
accumulated depreciation or amortisation other than goodwill is
recognised immediately in profit or loss.
Provisions
Provisions are recognised when the Group has a present legal or
constructive obligation as a result of past events, it is probable
that an outflow of resources will be required to settle the
obligation and a reliable estimate of the amount can be made. If
the effect is material, provisions are determined by discounting
the expected future cash flows at an appropriate pre-tax discount
rate.
Leases
Leases are accounted for on a 'right-of-use model' reflecting
that, at the commencement date, the Company as a lessee has a
financial obligation to make lease payments to the lessor for its
right to use the underlying asset during the lease term. The
financial obligation is recognised as a lease liability, and the
right to use the underlying asset is recognised as a right-of-use
asset. The right-of-use assets are recognised within property,
plant and equipment on the face of the financial position and are
presented separately in note 11.
The lease liability is initially measured at the present value
of the lease payments using the rate implicit in the lease or,
where that cannot be readily determined, the incremental borrowing
rate. Subsequently the lease liability is measured at amortised
cost, with interest increasing the carrying amount and lease
payments reducing the carrying amount. The carrying amount is
re-measured to reflect any reassessment or lease modifications, or
to reflect revised in-substance fixed lease payments.
Right-of-use assets are measured at cost comprising the
following:
-- the amount of the initial measurement of lease liability;
-- any lease payments made at or before the commencement date
less any lease incentives received;
-- any initial direct costs; and
-- restoration costs.
Subsequently the right-of-use asset is measured at cost less
accumulated depreciation and impairment losses. Depreciation is
calculated to write off the cost on a straight line-basis over the
lease term.
The Group does not have any short-term leases of equipment or
vehicles.
Share capital/equity instruments
Ordinary shares are classified as equity. Equity instruments
issued by the Company are recorded at the proceeds received, net of
direct issue costs. The Company has one class Ordinary share which
carries no right to fixed income. Each share carries the right to
one vote at general meetings of the Company.
Share-based payments
Equity-settled share-based payments to employees and directors
are measured at the fair value of the equity instruments at grant
date. The fair value excludes the effect of non-market-based
vesting conditions.
The fair value determined at the grant date of the
equity-settled share-based payments is expensed on a straight-line
basis over the vesting period, based on the Group's estimate of
equity instruments that will eventually vest. At each reporting
date, the Group revises the estimate of the number of equity
instruments expected to vest as a result of the effect of
non-market-based vesting conditions. The impact of the revision of
the original estimates, if any, is recognised in profit or loss
such that the cumulative expense reflects the revised estimate,
with a corresponding adjustment to equity reserves.
The fair value of the options is measured using the Black
Scholes options valuation model.
Adoption of new and revised standards
No new standards were adopted in the year.
Standards issued but not yet effective
There are no other standards that are not yet effective and that
would be expected to have a material impact on the entity in the
current or future reporting periods and on foreseeable future
transactions.
3 Critical accounting estimates and judgements
In application of the Group's accounting policies, which are
described in note 2, the directors are required to make judgements,
estimates and assumptions about the carrying amounts of assets and
liabilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical
experience and other factors that are relevant. Actual results may
differ from these estimates.
The estimates and underlying assumptions are reviewed on an
ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimate is revised if the revision affects
only that period, or in the period of the revision and future
periods if the revision affects both current and future
periods.
Critical judgements in applying the Group's accounting
policies
The following are the critical judgements, apart from those
involving estimations, that the directors have made in the process
of applying the Group's accounting policies and that have a
significant effect on the amounts recognised in the financial
statements.
Work in progress within revenue recognition
Work in progress is calculated on a project by project basis
using the fair value of chargeable time that is un-invoiced at the
period end. Historic analysis shows that recovery rates of work in
progress are very high; the Group does not expect any work in
progress to be irrecoverable. Work in progress is reviewed on a
monthly basis to ensure it is recognised appropriately, it is
probable that economic benefits will flow to the Group and that the
fair value can be reliably measured (note 4). Work in progress is
accounted for under contract assets.
Share based payments
The Company has granted share options to certain employees and
directors of the Group. The share options granted become
exercisable at varying future dates. If certain conditions are met
the employee will be eligible to exercise their option at an
exercise price determined on the date the share options are
granted.
The share-based payment charge is recognised in the statement of
comprehensive income and is calculated based on the Company's
estimate of the number of share options that will eventually
vest.
Assumptions regarding the fair value of the Company's shares are
considered when measuring the value of share-based payments for
employees, which are required to be accounted for as equity-settled
share-based payment transactions pursuant to IFRS 2. The resulting
staff costs are recognised pro rata in the statement of
comprehensive income to reflect the services rendered as
consideration during the vesting period (note 20).
Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources
of estimation uncertainty at the reporting date, that may have a
significant risk of causing material adjustment to the carrying
amounts of assets and liabilities within the next financial year,
are discussed below.
Impairment of goodwill
The carrying amounts of the Group's assets value are reviewed at
each reporting date to determine whether there is any indication of
impairment. If any such indication exists, the asset's recoverable
amount is estimated, and an impairment loss is recognised where the
recoverable amount is less than the carrying value of the asset.
Any impairment losses are recognised in the income statement.
The recoverable amount of the goodwill is determined from value
in use calculations. The key assumptions for the value in use
calculations are those regarding the discount rates, growth rates
and expected changes to income and direct costs during the
period.
Management estimates discount rates using pre-tax rates that
reflect current market assessments of the time value of money and
the risks specific to each acquisition of goodwill. Discount rates
of 16.12% and a terminal value of 1% has been used.
Growth rates of between 0-15% have been applied to each cash
generating unit as set out in note 10 these are based on industry
rates, management's knowledge of the different businesses and the
markets and the ability for the businesses to expand. The maximum
period over which the cashflows are reviewed is 5 years.
Sensitivities have been applied to all assumptions.
Valuation of unquoted investments
The Group determines the fair value of these financial
instruments using recent transactions or valuation models if
information about recent transactions is not available. The values
derived from applying these models are significantly impacted by
the choice of the valuation model used and the underlying
assumptions made, such as the amounts and timing of future cash
flows, discount rates, volatility and credit risk.
Management has determined that a valuation based on five times
annual turnover is an appropriate measure of fair value based on
prior knowledge of the industry.
4 Revenue and Finance income
An analysis of the Group's revenue is as
follows:
2023 2022
GBP'000 GBP'000
Continuing operations - rendering of services
Specialist housing consultancy income 10,558 8,502
Treasury management income 431 600
Specialist sports and education consultancy
income 1,260 1,017
-------- --------
12,249 10,119
Interest received on bank deposits 17 -
------- -------
12,266 10,119
======= =======
5 Operating segments
The Group has two reportable segments; consultancy and treasury
management services, the results of which are included within the
financial information. In accordance with IFRS8 'Operating
Segments', information on segment assets is not shown, as this is
not provided to the chief operating decision-maker.
The principal activities of the Group are as follows:
Consultancy - a range of services to support the business needs
of a diverse range of organisations (including housing
associations, local authorities, multi academy trusts and sporting
businesses) across the housing, education and sports sectors. Most
consultancy projects run over one to two months and on-going
business development is required to ensure a full pipeline of
consultancy work for the employed team.
Treasury Management - within this segment of the business
several client organisations enter fixed period retainers to ensure
immediate call-off of the required services.
The accounting policies of the reportable segments are the same
as the Group's accounting policies described in note 2. Segment
profit represents the profit earned by each segment, without
allocation of central administration costs, including directors'
salaries, finance costs and income tax expense. This is the measure
reported to the Group's executive directors for the purpose of
resource allocation and assessment of segment performance.
2023 2022
GBP'000 GBP'000
Revenue from Consultancy 11,818 9,519
Revenue from Treasury management 431 600
12,249 10,119
Cost of sales from Consultancy 9,269 7,367
Cost of sales from Treasury management 375 546
-------- --------
9,644 7,913
Gross profit from Consultancy 2,550 2,152
Gross profit from Treasury management 55 54
-------- --------
2,605 2,206
Administrative expenses (1,828) (1,488)
Operating profit 777 718
======== ========
Within consultancy revenues, approximately 18% (2022: 9%) has
arisen from the segment's largest customer L&Q; within treasury
management 11% (2022: 15%).
Geographical information
Revenues from external customers, based on location of the
customer, are shown below:
2023 2022
GBP'000 GBP'000
UK 11,727 9,528
Europe 508 380
Rest of World 14 211
-------- --------
12,249 10,119
======== ========
6 Profit before taxation
2023 2022
GBP'000 GBP'000
Profit before taxation is arrived at after
charging:
Auditors' remuneration (see below) 66 56
Depreciation of property, plant and equipment
(see note 11) 31 25
Depreciation of leasehold property (see
note 11) 93 93
Impairment of goodwill 120 -
Staff costs (see note 7) 7,180 5,879
Breakdown of auditors' remuneration
2023 2022
GBP'000 GBP'000
Auditors' remuneration
Fees payable to the Company's auditors
for:
The audit of the parent Company 40 33
The audit of the Company's subsidiaries 21 18
The review of the interim report 3 3
The provision of a CASS assurance report
to the FCA 2 2
66 56
======== ========
7 Staff costs
2023 2022
The average monthly number of employees
(including directors) employed by the
Group was: 102 86
-------- --------
2023 2022
GBP'000 GBP'000
Aggregate remuneration (including directors)
Wages and salaries 6,153 5,171
Share-based payments 12 8
Pension contributions 314 262
Social security costs 701 438
-------- --------
7,180 5,879
======== ========
2023 2022
GBP'000 GBP'000
Directors' remuneration
Salary (including taxable benefits) 345 330
Share-based payments 1 5
Pension contributions 17 17
---------- ---------
363 352
========== =========
Two directors are members of the company's defined contribution
pension scheme.
The amounts set out above include remuneration to the highest
paid director as follows:
2023 2022
GBP'000 GBP'000
Salary (including taxable benefits) 195 177
Share-based payments - 4
Pension contributions 10 10
---------- ---------
205 191
========== =========
Remuneration of key management personnel
The remuneration of the key management personnel of the Group,
including all directors, is set out below in aggregate for each of
the categories specified in IAS 24 Related Party Disclosures.
2023 2022
GBP'000 GBP'000
Wages and salaries 1,036 1,186
Share-based payments 5 (7)
Post-retirement benefits 48 49
----------- -----------
1,089 1,228
=========== ===========
8 Taxation
2023 2022
GBP'000 GBP'000
Corporation tax:
Current year 156 139
========= ========
The tax charge for the year can be reconciled to the profit
in the income statement as follows:
2023 2022
GBP'000 GBP'000
Profit before taxation 674 718
Tax at the UK corporation tax rate of
19% (2022: 19%) 128 136
Expenses not deductible 28 3
Tax expense for the year 156 139
========= ========
The Finance Bill 2021 substantively enacted on 24 May 2021
included legislation increasing the UK corporation tax rate from
19% to 25% with effect from 1 April 2023.
9 Earnings per share
Basic earnings per share is calculated by dividing the profit
after tax attributable to the equity holders of the Group by the
weighted average number of shares in issue during the year. Diluted
earnings per share is calculated by adjusting the weighted average
number of shares outstanding to assume conversion of all potential
dilutive shares, namely share options. Details of which are set out
in note 20.
2023 2022
GBP'000 GBP'000
Profit after tax attributable to owners
of the parent 518 579
-------- --------
Weighted average number of shares '000 '000
* Basic 39,962 39,962
* Diluted 41,016 41,153
Basic earnings per share 1.29p 1.45p
Diluted earnings per share 1.26p 1.41p
10 Goodwill
Group Goodwill
GBP'000
Cost
At 1 April 2021 3,872
Additions -
---------
At 31 March 2022 3,872
Additions -
---------
At 31 March 2023 3,872
---------
Accumulated impairment losses
At 1 April 2021 (555)
Impairment loss for the year -
---------
At 31 March 2022 (555)
Impairment losses for the year (120)
---------
At 31 March 2023 (675)
---------
Net book value
At 1 April 2021 3,317
=========
At 1 April 2022 3,317
=========
At 31 March 2023 3,197
=========
Goodwill acquired in a business combination is allocated, at
acquisition, to the cash generating units that are expected to
benefit from that business combination. Each Subsidiary is
considered to be the cash generating unit for the purpose of
impairment review.
The Group tests goodwill annually for impairment, or more
frequently if there are any indications that goodwill might be
impaired.
The recoverable amount of goodwill is determined from value in
use calculations. The key assumptions for the value in use
calculations are those regarding growth rate of client base and
project fees. Management's approach to determining the values to
each key assumption is based on experience and project work already
secured for future periods and the expected utilisation of
consultants. Management have projected cash flows over a period of
five years, based on growth rates of between 0% and 16% per annum;
this is based on past performance and expected future activity. A
discount rate of 16.1% and a terminal value of 1.0% has been
used.
The Growth rates for each cash generating unit is as follows.
For Property 0-7% (2022: 0-7%), for Treasury 0-16% (2022: 5-6%),
for Oaks 6% (2022: 9-13%)
Sensitivity analysis has been performed on the value in use
calculations, holding all other variables constant to:
-- Apply a 5-10% reduction to the forecasted turnover.
-- Apply a 5-10% decrease in gross profit margins.
-- Apply an increase in the discount rate.
A decline in turnover of 10% would trigger an impairment in
Treasury, 10% in Property and 8% in Oaks. A decline in gross profit
to 21% would trigger an impairment in Treasury, 16% in Property and
19% in Oaks. A discount rate of 26% would trigger an impairment in
Treasury, 40% in Property and 35% in Oaks.
The sensitivities applied in Property and Oaks do not provide
reasonable possible changes and therefore no impairment has been
made. However, an impairment has been made of GBP120k within
Treasury due to the decline in the Education market.
11 Property, plant and equipment (Group)
Group Right of Leasehold Fixtures Computer Total
use assets-Leasehold improvement and fittings equipment
property
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 April 2021 514 27 45 173 759
Additions - - - 37 37
---------------------- ------------- -------------- ----------- --------
At 31 March 2022 514 27 45 210 796
Additions - - 1 44 45
---------------------- ------------- -------------- ----------- --------
At 31 March
2023 514 27 46 254 841
---------------------- ------------- -------------- ----------- --------
At 1 April 2021 153 11 41 160 365
Charge for the
year 88 5 3 22 118
---------------------- ------------- -------------- ----------- --------
At 31 March 2022 241 16 44 182 483
Charge for the
year 88 5 2 29 124
---------------------- ------------- -------------- ----------- --------
At 31 March
2023 329 21 46 211 607
---------------------- ------------- -------------- ----------- --------
Net book value
At 1 April 2021 361 16 4 13 394
====================== ============= ============== =========== ========
At 31 March 2022 273 11 1 28 313
====================== ============= ============== =========== ========
At 31 March
2023 185 6 0 43 234
====================== ============= ============== =========== ========
Computer
Company equipment
GBP'000
Cost
At 1 April 2021 64
Additions 3
-----------
At 31 March 2022 67
Additions 15
-----------
At 31 March 2023 82
-----------
Accumulated depreciation
At 1 April 2021 64
Charge for the year -
-----------
At 31 March 2022 64
Charge for the year 6
-----------
At 31 March 2023 70
-----------
Net book value
At 1 April 2021 -
===========
At 31 March 2022 3
===========
At 31 March 2023 12
===========
12 Investment in subsidiaries
Company Investments
in subsidiaries
GBP'000
Cost
At 1 April 2021 4,725
Additions 10
-----------------
At 31 March 2022 4,735
Additions 12
-----------------
At 31 March 2023 4,747
-----------------
Accumulated impairment losses
At 1 April 2021 555
Impairment losses for the year -
-----------------
At 31 March 2022 555
Impairment losses for the year 120
-----------------
At 31 March 2023 675
-----------------
Net book value
At 1 April 2021 4,170
=================
At 31 March 2022 4,180
=================
At 31 March 2023 4,072
=================
Details of the Company's subsidiaries at 31 March 2023 are as
follows:
Proportion
of ownership
Place of incorporation and voting rights
and operation Principal activity held
Altair Consultancy
and Advisory Services England and Specialist housing
Limited Wales consultancy 100%
Aquila Treasury and
Finance Solutions England and Treasury management
Limited Wales consultancy 100%
Specialist sports
England and and education
Oaks Consultancy Limited Wales consultancy 100%
The accounting reference date of each of the subsidiaries above
is co-terminus with that of the Company. The registered office of
each subsidiary is Tempus Wharf, 29a Bermondsey Wall West, London,
SE16 4SA.
The following companies are all dormant, the registered office
of each is Tempus Wharf, 29a Bermondsey Wall West, London, SE16
4SA.
Proportion of Accounting
Place of incorporation ownership and voting reference
and operation rights held date
Altair International England and Wales 100% held by Aquila 31 August
Consultancy Limited Services Group
plc
Murja Limited England and Wales 100% held by ATFS 30 May
Limited
Finalysis UK Limited England and Wales 100% held by Aquila 31 March
Services Group
plc
13 Investments
Fair Value Hierarchy 2023 2022
GBP'000 GBP'000
Unquoted equity investments Level 3 71 71
-------- --------
The Group has a 5.3% equity shareholding in AssetCore Limited an
unquoted company. AssetCore's principal activity is a cloud-based
platform used to manage loan security within the affordable housing
sector. As explained in Note 3, based on the information available
at the reporting date the directors consider cost to be an
appropriate estimate of fair value.
Financial instruments measured at fair value subsequent to
initial recognition are grouped into levels 1 to 3 based on the
degree to which the fair value is observable, i.e.:
Level 1 fair value measurements are those derived from quoted
prices (unadjusted) in active markets for identical assets or
liabilities.
Level 2 fair value measurements are those derived from inputs
other than quoted prices included within level 1 that are
observable for the asset or liability, either directly or
indirectly.
Level 3 fair value measurements are those derived from valuation
techniques that include inputs for the asset or liability that are
not based on observable market data (unobservable inputs).
14 Trade and other receivables
Group Group Company Company
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
Trade receivables 2,715 2,240 - -
Group undertakings - - 195 964
Other receivables 51 35 26 10
Prepayments 102 117 15 17
Contract assets 262 201 - -
--------- -------- -------- ---------
3,130 2,593 236 991
========= ======== ======== =========
Total <30 days 30-60 66-90 >90 days
days days
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
31 March 2023 2,715 2,556 94 20 45
31 March 2022 2,240 2,182 14 23 21
No expected credit loss is recognised in the accounts. The Group
does not expect any debts not to be paid. The directors have
reviewed the provision for expected credit loss and have not
identified any which need to be provided for.
15 Trade and other payables
Group Group Company Company
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
Trade payables 532 510 33 11
Other payables 163 77 - -
Amounts owed to Group
undertakings - - 433 283
Taxes and social security
costs 974 715 - -
Accruals 357 246 228 146
Contract liabilities 473 369 - -
-------- -------- -------- --------
2,499 1,917 694 440
======== ======== ======== ========
Of the contract liability brought forward at the start of the
year GBP369k (2022: GBP297k) was recognised in revenue in the
year.
16 Lease liabilities
The Statement of Financial Position shows the following amounts
relating to lease liabilities.
2023
GBP'000
At 31 March 2022 284
Lease payments (97)
Interest expense 8
--------
Closing amounts as at 31 March 2023 195
--------
Current 69
Non-current 126
========
17 Share capital
2023 2022
GBP'000 GBP'000
Allotted, called up and fully paid
39,961,955 (2022: 39,961,955) Ordinary shares
of 5p each 1,998 1,998
======== ========
The Company has one class Ordinary share which carries no right
to fixed income. Each share carries the right to one vote at
general meetings of the Company.
A reconciliation of share capital, share premium account and
merger reserve is set out below:
Amount
Number called
of Ordinary up and Share Merger
shares fully paid premium reserve
'000 GBP'000 GBP'000 GBP'000
At 31 March 2021 39,962 1,998 1,712 3,042
At 31 March 2022 39,962 1,998 1,712 3,042
At 31 March 2023 39,962 1,998 1,712 3,042
============= ============ ========= =========
18 Reserves
The share premium account represents the amount received on the
issue of Ordinary shares by the Company in excess of their nominal
value and is non-distributable.
The merger relief reserve arose on the Company's acquisition of
Altair. There is no legal share premium on the shares issued as
consideration as section 612 of the Companies Act 2006, which deals
with merger relief, applies in respect of the acquisition. Since
the shareholders of Altair became the majority shareholders of the
enlarged group, the acquisition is accounted for as though the
legal acquiree is the accounting acquirer.
19 Dividends
2023 2022
Amounts recognised as distributions to GBP'000 GBP'000
equity holders
Final dividend for the year ended 31 March
2022 of 0.4p per share (2021: 0.4p) 160 160
Interim dividend for the year ended 31 March
2023 of 0.25p per share (2022: 0.2p) 100 80
260 240
======== ========
Proposed final dividend for the year ended
31 March 2023 of 0.5p per share (2022: 0.4p) 200 160
======== ========
20 Share-based payment transactions
The Company operates an Unapproved Scheme and an Enterprise
Management Incentives Scheme. The total charge in the year to 31
March 2023 arising from share-based payment transactions is GBP12k
(2022: GBP8k).
Number Weighted average
Unapproved scheme '000 exercise price
Number of options outstanding at 1 April
2022 171 GBP0.35
Lapsed during period -
Exercised during period -
-------
Number of options outstanding as at
31 March 2023 171
=======
Number of options exercisable as at
31 March 2023 171
=======
The exercise price of the options outstanding at 31 March 2023
is 35p. The weighted average remaining contractual life of the
options outstanding at 31 March 2023 is 2 years (2022: 3
years).
Number Weighted average
EMI scheme '000 exercise price
Number of options outstanding at 1 April
2022 1,474 GBP0.05
Granted during the period 931 GBP0.26
Lapsed during the period (169) GBP0.05
Cancelled during period (40) GBP0.26
Number of options outstanding as at
31 March 2023 2,196
=======
Number of options exercisable as at
31 March 2023 1,305
======
The weighted average remaining contractual life of the options
outstanding at 31 March 2023 is 5 years (2022: 3 years).
On 1 April 2022, the Company granted 930,770 options to certain
employees and directors of the Group at an exercise price of 26p.
The options are exercisable between 1 April 2025 and 31 March 2032.
The weighted average fair value of the options at grant date was
GBP0.0416. The fair value of the options was measured using the
Black Scholes options valuation model. The inputs into that model
in respect of the EMI share options were as follows:
Share price GBP0.26
Exercise price GBP0.26
Expected volatility 20.81%
Expected option life 10 years
Risk-free rate 1.3%
21 Related party disclosures
Balances and transactions between the Group and other related
parties are disclosed below:
Dividends totalling GBP76k (2022: GBP70k) were paid in the year
in respect of Ordinary Shares held by the Company's directors.
At 31 March 2023, the balance owed to Richard Wollenberg for
services as a non-executive director was GBP8k (2022: GBP4k).
Amounts paid to Derek Joseph for consultancy services GBP17k
(2022: GBP23k).
22 Control
In the opinion of the Directors there is no single ultimate
controlling party.
23 Financial instruments
Financial risk management
The Group's activities are exposed to a variety of market risk
(including foreign currency risk and interest rate risk), credit
risk and liquidity risk.
Credit risk
Credit risk is the risk of financial loss to the Group resulting
from counterparties failing to discharge their obligations to the
Group. The Group's principal financial assets are trade and other
receivables and cash and cash equivalents. The Group only deposits
cash with banks that have an A rating. The Group holds cash in
current and treasury reserve accounts. The sums held in treasury
reserve are on less than six-month terms, the Group has access to
this cash should it be required at short notice.
The Group considers its credit risk to be low. Of the total
trade receivables at the 2023 year-end GBP729k (2022: GBP258k) is
due from one customer.
There are no other customers that represent more than 10% of the
total balance of trade receivables. The maximum exposure to credit
risk is equal to the carrying value of these instruments.
Liquidity risk
Liquidity risk is the risk of the Group being unable to meet its
liabilities as they fall due. The Group manages liquidity risk by
maintaining enough cash reserves and holding banking facilities,
and by continuously monitoring forecast and actual cash flows. In
addition, the Group is a cash generative business with income being
received regularly over the course of the year. The Group held cash
balances of GBP2,405K (2022: GBP2,193k) at the year-end.
Trade payables are all less than 30days.
Foreign currency risk
Foreign exchange risk is the risk of loss due to adverse
movements in the exchange rates affecting the Group's profits and
cash flows. Only a very small number of clients are invoiced in
Euros and USD and the foreign exchange exposure is not considered a
significant risk. The Group's principal financial assets are cash
and cash equivalents and trade and other receivables, which are
almost exclusively denominated in Pounds Sterling.
Interest rate risk
The Group does not undertake any hedging activity in this area.
The main element in interest rate risk involves sterling
deposits.
Capital risk management
Internal working capital requirements are low and are regularly
monitored.
The Group's objective when managing capital is to safeguard the
Group's ability to continue as a going concern in order to provide
return for shareholders, benefits for other stakeholders and to
maintain optimal capital structure and to reduce the cost of
capital.
In order to ensure an appropriate return for shareholder capital
invested in the Group, management thoroughly evaluates all material
projects and potential acquisitions and has them approved by the
Board of Directors where applicable.
The Group monitors capital on a short- and medium-term view.
24 Post Balance Sheet events
There are no post balance sheet events.
Notice of Annual General Meeting
Notice is hereby given that the Annual General Meeting (AGM) of
Aquila Services Group plc will be held at Tempus Wharf 29A,
Bermondsey Wall West, London, SE16 4SA on 26 July 2023 at 12:00
midday, for the purpose of considering and, if thought fit, passing
the following resolutions, of which resolutions numbered 1 to 6
will be proposed as ordinary resolutions and resolutions 7 and 8
will be proposed as special resolutions. Resolutions 6 to 8 are
items of special business.
Ordinary business
1. To receive the reports of the directors and auditor and the
financial statements for the period ended 31 March 2023.
2. To approve the remuneration report for the period ended 31 March 2023.
3. To approve the revised remuneration policy applicable for the
period commencing 01 April 2023 as set out in the annual report and
financial statements.
4. That, following a recommendation by the directors, a final
dividend payment of 0.5p per Ordinary Share shall be paid to those
persons who were named on the register of shareholders on 14 July
2023.
5. That Crowe UK LLP be and is hereby reappointed as auditor of
the Company and that the directors be authorised to determine the
auditor's remuneration.
Special business
6. That, in accordance with section 551 of the Companies Act
2006 ("CA 2006"), the directors be generally and unconditionally
authorised to issue and allot equity securities (as defined by
section 560 of the CA 2006) up to an aggregate nominal amount
of:
6.1 GBP73,825 in connection with the valid exercise of the
options (both approved and unapproved) granted by the Company (as
set out in the prospectus issued by the Company dated 20 July
2015), any unapproved options granted to current or former officers
of the Company and options granted to employees and officers of the
Company and/or its subsidiaries in accordance with the terms of the
Company's Employee Share Option Scheme ("Options"); and
6.2 in any other case, GBP666,033 (such amount to be reduced by
the nominal amount of any equity securities allotted pursuant to
the authorities in paragraph 6.1 above in excess of the stated
amount) provided that this authority shall, unless renewed, varied
or revoked by the Company, expire on the date of the next annual
general meeting of the Company save that the Company may, before
such expiry, make offers or agreements which would or might require
relevant securities to be allotted and the directors may allot
relevant securities in pursuance of such offer or agreement
notwithstanding that the authority conferred by this resolution has
expired.
This resolution revokes and replaces all unexercised authorities
previously granted to the directors to allot relevant securities
but without prejudice to any allotment of sha res or grant of
rights already made, offered or agreed to be made pursuant to such
authorities.
7. That, subject to resolution 6 above being duly passed, the
directors of the Company be and are hereby empowered, pursuant to
section 570 of the CA 2006, to allot equity securities (as defined
in section 560 of the CA 2006) wholly for cash pursuant to the
authority conferred upon them by resolution 6 above (as varied,
renewed or revoked from time to time by the Company at a general
meeting) as if section 561(1) of the CA 2006 did not apply to any
such allotment provided that such power shall be limited to the
allotment of equity securities:
7.1 in connection with a rights issue or any other pre-emptive
offer in favour of holders of equity securities where the equity
securities offered to each such holder is proportionate (as nearly
as may be) to the respective amounts of equity securities held by
each such holder subject only to such exclusion or other
arrangements as the directors may consider appropriate to deal with
fractional entitlements or legal or practical difficulties under
the laws of or the requirements of any recognised regulatory body
in any territory or otherwise;
7.2 in connection with the valid exercise of Options;
7.3 in connection with the valid exercise of any share options
granted to employees of the Group in accordance with the terms of
the Employee Share Option Scheme; and
7.4 otherwise , up to a maximum nominal amount of GBP99,905.
The power granted by this resolution will expire on the
conclusion of the Company's next annual general meeting (unless
renewed, varied or revoked by the Company prior to or on such date)
save that the Company may, before such expiry, make offers or
agreements which would or might require equity securities to be
allotted after such expiry and the directors may allot equity
securities in pursuance of any such offer or agreement
notwithstanding that the power conferred by this resolution has
expired.
This resolution revokes and replaces all unexercised powers
previously granted to the directors to allot equity securities as
if section 561(1) of the CA 2006 did not apply but without
prejudice to any allotment of equity securities already made or
agreed to be made pursuant to such authorities.
8. That the Company be and is hereby authorised generally and
unconditionally to make market purchases (within the meaning of
section 693(4) of the CA 2006) of its ordinary shares ("Ordinary
Shares") provided that:
8.1 the maximum aggregate number of Ordinary Shares that may be purchased is 3,996,196;
8.2 the minimum price (exclusive of expenses) which may be paid
for an Ordinary Share is GBP0.05;
8.3 the maximum price (exclusive of expenses) which may be paid
for an Ordinary Share is the higher of:
8.3.1 105 per cent of the average closing middle market
quotations for the Ordinary Shares as quoted on the Official List
of the London Stock Exchange for the five business days prior to
the day the purchase is made; and
8.3.2 the value of an Ordinary Share calculated on the basis of
the higher of the price quoted for:
8.3.3 the last independent trade of; and
8.3.4 the highest current independent bid for any number of
Ordinary Shares on the Official List.
8.4 The authority conferred by this resolution shall expire on
the conclusion of the Company's next annual general meeting save
that the Company may, before the expiry of the authority granted by
this resolution , enter into a contract to purchase Ordinary Shares
which will or may be executed wholly or partly after the expiry of
such authority.
Registered office : By order of the board
Tempus Wharf Claire Banks
29a Bermondsey Wall West Company Secretary
London
SE16 4SA 30 June 2023
Notes
1. A member entitled to attend and vote at the above meeting is
entitled to appoint a proxy to exercise all or any of their rights
to attend, speak and vote on his/her behalf at the meeting. A proxy
need not be a member of the company.
2. You may appoint more than one proxy provided each proxy is
appointed to exercise rights attached to different shares. You may
not appoint more than one proxy to exercise rights attached to any
one share. To appoint more than one proxy you may photocopy the
form of proxy. Please indicate the proxy holder's name and the
number of shares in relation to which they are authorised to act as
your proxy (which, in aggregate, should not exceed the number of
shares held by you). Please also indicate if the proxy instruction
is one of multiple instructions being given. All forms must be
signed and should be returned together in the same envelope.
3. A form of proxy accompanies this notice. Forms of proxy, to
be valid, must be delivered to the company's registrars, Neville
Registrars Limited, Neville House, Steelpark Road, Halesowen B62
8HD in accordance with the instructions printed thereon, not less
than 48 hours before the time set for the holding of the
meeting.
4. If you are not a member of the company but you have been
nominated under section 146 of the Companies Act 2006 (the 'Act')
by a member of the company to enjoy information rights, you do not
have the rights of members in relation to the appointment of
proxies set out in notes 1, 2 and 3. The rights described in those
notes can only be exercised by members of the company.
5. A vote withheld is not a vote in law, which means that the
vote will not be counted in the calculation of votes for or against
the resolution. If you either select the "Withheld" option or if no
voting indication is given, your proxy will vote or abstain from
voting at his or her discretion. Your proxy will vote (or abstain
from voting) as he or she thinks fit in relation to any other
matter which is put before the meeting.
6. Information regarding the meeting, including the information
required by section 311A of the Act, is available from
www.aquilaservicesgroup.co.uk
7. As provided by Regulation 41 of the Uncertificated Securities
Regulations 2001, only those members registered in the register of
members of the company 48 hours before the time set for the meeting
shall be entitled to attend and vote at the meeting in respect of
the number of shares registered in their name at that time. Changes
to entries on the relevant register of securities after that time
shall be disregarded in determining the rights of any person to
attend or vote at the meeting.
8. As at close of business on 29 June 2023 the company's issued
share capital comprised 39,961,955 ordinary shares of 5 pence each.
Each ordinary share carries the right to one vote at a general
meeting of the company and, therefore, the total number of voting
rights in the company at close of business on 29 June 2023 is
39,961,955.
9. Under section 319A of the Act, the company must answer any
question you ask relating to the business being dealt with at the
meeting unless (a) answering the question would interfere unduly
with the preparation for the meeting or involve the disclosure of
confidential information; (b) the answer has already been given on
a website in the form of an answer to a question; or (c) it is
undesirable in the interests of the company or the good order of
the meeting that the question be answered.
10. If you are a person who has been nominated under section 146
of the Act to enjoy information rights (a 'Nominated Person'), you
may have a right under an agreement between you and the member of
the company who has nominated you to have information rights (a
'Relevant Member') to be appointed or to have someone else
appointed as a proxy for the meeting. If you either do not have
such a right or if you have such a right but do not wish to
exercise it, you may have a right under an agreement between you
and the Relevant Member to give instructions to the Relevant Member
as to the exercise of voting rights. Your main point of contact in
terms of your investment in the company remains the Relevant Member
(or, perhaps, your custodian or broker) and you should continue to
contact them (and not the company) regarding any changes or queries
relating to your personal details and your interest in the company
(including any administrative matters). The only exception to this
is where the company expressly requests a response from you.
11. Members satisfying the thresholds in section 338 of the Act
may require the company to give, to members of the company entitled
to receive notice of the Annual General Meeting, notice of a
resolution which those members intend to move (and which may
properly be moved) at the Annual General Meeting. A resolution may
properly be moved at the Annual General Meeting unless (i) it
would, if passed, be ineffective (whether by reason of any
inconsistency with any enactment or the company's constitution or
otherwise); (ii) it is defamatory of any person; or (iii) it is
frivolous or vexatious. A request made pursuant to this right may
be in hard copy or electronic form, must identify the resolution of
which notice is to be given, must be authenticated by the person(s)
making it and must be received by the company not later than 6
weeks before the date of the Annual General Meeting.
12. Members satisfying the thresholds in section 338A of the Act
may request the company to include in the business to be dealt with
at the Annual General Meeting any matter (other than a proposed
resolution) which may properly be included in the business at the
Annual General Meeting. A matter may properly be included in the
business at the Annual General Meeting unless (i) it is defamatory
of any person or (ii) it is frivolous or vexatious. A request made
pursuant to this right may be in hard copy or electronic form, must
identify the matter to be included in the business, must be
accompanied by a statement setting out the grounds for the request,
must be authenticated by the person(s) making it and must be
received by the company not later than 6 weeks before the date of
the Annual General Meeting.
13. Members satisfying the thresholds in section 527 of the Act
can require the company to publish a statement on its website
setting out any matter relating to (i) the audit of the company's
accounts (including the auditor's report and the conduct of the
audit) that are to be laid before the Annual General Meeting; or
(ii) any circumstances connected with an auditor of the company
ceasing to hold office since the last Annual General Meeting, which
the members propose to raise at the meeting. The company cannot
require the members requesting the publication to pay their
expenses. Any statement placed on the website must also be sent to
the company's auditor no later than the time it makes its statement
available on the website. The business which may be dealt with at
the Annual General Meeting includes any statement that the company
has been required to publish on its website pursuant to this
right.
14. Copies of the directors' service contracts will be available
for inspection at the registered office of the company during usual
business hours from the date of this notice until the date of the
Annual General Meeting, and also during and at least fifteen
minutes before the beginning of the Annual General Meeting.
This information is provided by RNS, the news service of the
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END
ACSFMMRTMTAJBIJ
(END) Dow Jones Newswires
July 03, 2023 02:00 ET (06:00 GMT)
Aquila Services (LSE:AQSG)
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Aquila Services (LSE:AQSG)
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