TIDMBBA
RNS Number : 7959S
BBA Aviation PLC
21 March 2016
Date of notification: 21 March 2016
BBA Aviation plc (the "Company")
Annual Financial Report and Notice of AGM
Further to the release of the Company's Final Results
announcement on 3 March 2016, the Company announces that it has
today published its Annual Financial Report 2015 ("Annual Report
2015").
The Company also announces that it has today posted to
shareholders notice of an Annual General Meeting to be held at
10.30am on Friday 6 May 2016 at the Royal Aeronautical Society, No.
4 Hamilton Place, London W1J 7BQ.
The Annual Report 2015 can be viewed at or downloaded from the
Company's website at:
http://www.bbaaviation.com/investors/reports.aspx
The Notice of Annual General Meeting 2016 can be viewed at or
downloaded from the Company's website at:
http://www.bbaaviation.com/investors/shareholder-information/agm-(annual-general-meeting).aspx
Copies of the documents listed below have also been submitted to
the National Storage Mechanism located at
www.morningstar.co.uk/UK/NSM:
-- Annual Report 2015
-- Chairman's Letter and Notice of Annual General Meeting
-- Annual General Meeting Proxy Card
-- Notice of Availability of BBA Aviation plc Annual Report 2015
and Notice of Annual General Meeting
At the Annual General Meeting due to be held on 6 May 2016 it is
proposed that the Company seek, inter alia, general authority from
ordinary shareholders for the Company to make market purchases of
up to 14.99 per cent of the Company's existing issued ordinary
share capital. This renews the authority granted by shareholders at
the Annual General Meeting held on 8 May 2015. Any ordinary shares
purchased under the authority may be cancelled or held in
treasury.
The Company's Final Results announcement released on 3 March
2016 contained the responsibility statement of the directors on the
Annual Report 2015 and details of significant events occurring
during the period. For the purposes of compliance with DTR 6.3.5
set out below is the statement of principal risks and uncertainties
which is set out in the Annual Report 2015 and the text of note 25
to the consolidated financial statements in the Annual Report 2015
concerning related party transactions.
"Our Risks
We are committed to effective risk management which supports the
achievement of our strategic objectives.
Our risk management process is designed to improve the
likelihood of delivering our business objectives, protect the
interests of our shareholders and key stakeholders and enhance the
quality of our decision making. It also assists in the safeguarding
of our assets, including people, finances, property and reputation.
We are committed to conducting business in accordance with all
applicable laws and regulations and in a manner that is consistent
with our values.
BBA Aviation's risk mitigation strategy and risk appetite are
matters that are overseen by the Board, with the support of the
Audit and Risk Committee, which manages the processes that underpin
risk assessment and our systems of internal control.
Risk Governance Structure
The Board
Responsible for our system of corporate governance, strategy,
policy, risk management and financial performance.
Accountability for monitoring
Audit and Risk Committee
Responsible for reviewing and approving the adequacy and
effectiveness of our risk management and internal controls.
Audit function
Reviews and reports on the system of internal control.
Chief Risk Officer
Reports on key risks and risk mitigation.
Executive Committee
Delegated with Board authority to review risks and take
appropriate action.
Business Divisions
Responsible for identifying, assessing and managing risks within
their businesses.
Company Risk Map (Risk Register)
& Divisional Risk Maps
Management teams in business units review risks through
self-assessment methodology and develop risk registers which
together with risk maps that are developed from the risk registers,
are submitted to the Executive Committee and the Audit and Risk
Committee on a bi-annual basis.
Responsibility for implementing
How we manage risk across BBA Aviation
The Board has established a framework for assessing risk in the
context of likelihood and impact in financial and reputational
terms. Each Group-level risk is assessed against this framework and
the Board re-assesses its risk appetite on a bi-annual basis when
Risk Maps are presented to the Audit and Risk Committee.
Group policies, standards and internal controls, together with
our values and our focus on safety, underpin our approach to risk
management. We are committed to being a responsible values-led
business and our leaders are responsible for embedding this into
BBA Aviation's culture, our decision-making and how we work.
Our employees are accountable for working to established
standards and for identifying and escalating encountered risks so
that they can be appropriately managed. The Group has comprehensive
training programmes to ensure that employees are appropriately
trained in BBA Aviation's ethics policies.
Risk Management Process
The key features of our risk management process are set out
below:
Board, Executive, Committee Review
Progress is monitored at global, divisional and business levels
and risks assessed on an ongoing basis as part of the business and
risk management process.
Business Objectives
Our business objectives are established on a 5-year basis and
drive our annual objectives.
Strategic Plan Development & Update
Our strategy informs the setting of shorter-term objectives
across the business and is widely communicated.
Portfolio and Investment Decisions
Portfolio and investment decisions are made based on risk
appetite to obtaining our business objectives.
Bi-Annual Risk Assessment Process
Annual Key & Emerging Strategic Risks Identification
Strategic Risk Mitigation
Ongoing Key Risk Monitoring
The bi-annual risk assessment process looks forward three years
to create BBA Aviation's risk profile. These key Group level risks
are input into the scenario modelling for the viability statement,
which is explained further on page 105 [of the Annual Report].
Progress in 2015
In 2015 we appointed a Chief Risk Officer to drive improvement
in our risk management process and integrate it more effectively
with our strategic planning and operational management processes.
We have updated our Risk Management Framework and more closely
aligned our Risk Management and Internal Audit functions. The risk
assessment process drives the internal audit scope, and the Chief
Risk Officer and Head of Internal Audit attend Audit and Risk
Committee meetings to provide regular updates.
We have changed the Internal Audit approach from one based on
substantive testing to a risk and controls based approach. All
audit findings are reported in terms of risk and impact, which is
aligned with BBA Aviation's Risk Model.
We strengthened our project management capability on major
projects including in our preparation for completion of the
Landmark Aviation acquisition. We prepared for this by employing a
specialist integration management consultancy to guide us through
the integration planning process to ensure that we deliver an
effective integration of Landmark Aviation into the BBA Aviation
Group and deliver the targeted synergies from the deal.
We have further developed our approach to third party vetting to
ensure that we are informed as to the identity and affairs of our
business partners before entering into business relationships with
them. We are investing in a leading-edge third party risk
management platform to move the due diligence process from manual
processing to an online data collection platform, automating
research and analysis. This reduces administrative tasks, enabling
us to focus on third party risk mitigation and working more closely
with our business partners.
The acquisition of Landmark Aviation completed on 5 February
2016. We have undertaken a risk management workshop with
representative Landmark Aviation senior managers to understand the
risk profile of the Landmark Aviation business and assess its
impact on BBA Aviation's business.
Principal Risks
We have identified ten principal risks and uncertainties facing
BBA Aviation which are considered by the Board to be material to
the development, performance, position or future prospects of the
Group. These risks, mitigations and changes during the year are
summarised in the table below. They are not set out in priority
order.
Change
during
Objective Risks Mitigation action/Control year
============ =========================================================== ============================================================ =============
Growth Structural changes Increased
in the global * Active monitoring of lead economic indicators. exposure
economic environment to early
or cycle fluctuations: cycle
* drive down B&GA and commercial flying, and military * Strong financial controls to monitor financial business
expenditure. performance and provide a basis for corrective action as a result
March 21, 2016 11:49 ET (15:49 GMT)
our effective ("BEPS")
tax rate and our * Continuous monitoring of changes to tax legislation, project
cash tax liabilities. taking advice where appropriate from reputable led by the
professional advisers. OECD
is likely to
accelerate
the
pace of
legislative
change in
the
countries in
which the
Group
operates."
============ =========================================================== ============================================================ =============
"Related party transactions
Transactions between the Company and its subsidiaries, which are
related parties, have been eliminated on consolidation and are not
disclosed in this note. Details of transactions between the Group
and other related parties are detailed below.
Compensation of key management personnel
Key management are the directors and members of the Executive
Committee. The remuneration of directors and other members of key
management during the year was as follows:
Restated
2015 2014
$m $m
------------------------- ---- --------
Short-term benefits 8.6 8.8
------------------------- ---- --------
Post-employment benefits 0.6 0.9
------------------------- ---- --------
Share-based payments 0.9 1.7
------------------------- ---- --------
10.1 11.4
------------------------- ---- --------
Post-employment benefits include contributions of $0.6 million
(2014: $0.6 million) in relation to defined contribution
schemes.
The remuneration of directors and key executives is determined
by the Remuneration Committee having regard to the performance of
individuals and market trends. The directors' remuneration is
disclosed in the Directors' Remuneration Report on pages 79 to
104.
Share-based payments of $0.9 million (2014: $1.7 million)
disclosed in the above table exclude the portion of the annual
bonus subject to compulsory deferral, which will be expensed over
the vesting period in accordance with IFRS 2: Share-based payment.
The 2015 annual bonus subject to compulsory deferral is $nil
million (2014: $1.2 million).
Other related party transactions
During the year, Group companies entered into the following
transactions with related parties which are not members of the
Group:
Amounts owed Amounts owed
by to
Sales of goods Purchase of goods related parties related parties
----------- ---------------- ------------------- ------------------ ------------------
2015 2014 2015 2014 2015 2014 2015 2014
$m $m $m $m $m $m $m $m
----------- ------- ------- -------- --------- -------- -------- -------- --------
Associates 8.5 16.9 355.5 530.2 0.3 1.5 52.1 46.1
----------- ------- ------- -------- --------- -------- -------- -------- --------
Purchases of goods principally relates to the purchase of
aviation fuel. Purchases were made at market price discounted to
reflect the quantity of goods purchased. The amounts outstanding
are unsecured and will be settled in cash. No guarantees have been
given or received.
At the balance sheet date, Group companies had loan receivables
from an associated undertaking of $2.6 million (2014: $2.5
million). The loans are unsecured and will be settled in cash, and
were made on terms which reflect the relationships between the
parties.
The Group operates various pension and other post-retirement
benefit schemes for its employees. Details are set out in note
18."
The financial information set out in the Company's Final Results
announcement of 3 March 2016 does not constitute the Company's
statutory accounts for the year ended 31 December 2015. Statutory
accounts for 2015 will be delivered to the Registrar of Companies
in due course.
This announcement should be read in conjunction with, and is not
a substitute for, reading the full Annual Report 2015.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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