TIDMFIH
RNS Number : 8745H
FIH Group PLC
13 June 2017
FIH group plc
("FIH" or "Group" or "Company")
Final results for the year ended 31 March 2017
A copy of the Group's results is also available on the Company's
website. FIH, the AIM quoted international services group that owns
essential services businesses in the Falkland Islands and the UK,
is pleased to announce its final results for the year ended 31
March 2017.
Group Financial Highlights
-- Group revenue increased 3.8% to GBP40.5 million (2016: GBP39.0 million)
-- Underlying pre-tax profits at GBP2.4 million (2016: GBP3.1 million)
-- Reported diluted earnings per share at 11.5 pence (2016: 17.9 pence)
-- EPS on underlying profits: 15.3 pence (2016:19.2 pence)
-- Cash balances increased to GBP15.1 million (2016: GBP14.0 million)
-- Bank borrowings of GBP3.8 million (2016: GBP3.3 million)
-- Net assets per share 320p (2016: 310p)
-- The Board is recommending a final dividend of 4 pence per
share for the year ended 31 March 2017
Operating Highlights
Falkland Islands Company ("FIC") - Quieter overall performance
as expected, but welcome growth in select divisions with tight cost
management helping mitigate challenging market conditions and
absence of oil stimulus
-- GBP1.16 million pre-tax profits (2016: GBP1.94 million)
-- Lack of oil-related demand fed through to weakened demand for goods and services
-- Retail competition also increased with the expansion of FIC's principle retail competitor
-- However, sales were up at the home-related businesses, Home
Living, Home Builder, and Falkland Building Services, supported by
the government's subsidised home-ownership scheme
Momart - Strong revenue performance despite market pressures and
fierce competition
-- Increase in overall revenue to GBP18.4 million (2016: GBP16.3
million) with particularly strong performance in Museum Exhibitions
(+19.9%)
-- Modest increase in Underlying Operating Profit to GBP0.54
million (2016: GBP0.46 million), limited by start-up costs from
newly expanded storage facilities
-- Despite pressure on museum budgets in the sector, Momart
delivered a range of notable UK exhibitions including: the
installation of "Abstract Expressionism" at the Royal Academy;
"Sunken Cities" at the British Museum; "Painters Paintings" and
"Beyond Caravaggio" at the National Gallery; "Francis Bacon
Invisible Rooms" at Tate Liverpool; "William Eggleston" and
"Picasso" at the National Portrait Gallery; "You Say You Want a
Revolution" at the V&A; and "The Radical Eye" at Tate
Modern
Portsmouth Harbour Ferry Company ("PHFC") - Steady performance
with careful cost management
-- Revenues steady at GBP4.29 million (2016: GBP4.24 million)
reflecting increased yield from ferry fares despite a 4.1% decline
in passenger numbers
-- Ferry fares increased by an average of 3% during June 2016,
with increased customer interest in tickets such as the "Park and
Float" and the discounted tickets for military personnel
-- Modest but profitable contribution from cruising income with
38 leisure cruises in the Solent area over the summer of 2016
Outlook - Softer trading in the Falklands, offset by close
cost-control at PHFC, and continued underlying growth at Momart.
Renewed focus on complementary value-enhancing acquisitions.
-- For the year ahead, we anticipate a quieter period in the
Falklands, with the absence of oil-exploration activity and
continued competition in the retail sector
-- At PHFC, the company will continue to focus on tight cost
control and maintaining excellent records of safety and
reliability. A modest stimulus is expected for passenger volumes,
with the completion of the disruptive construction works at the
passenger interchange and the arrival of the new HMS Queen
Elizabeth carrier
-- At Momart, we anticipate beneficial impacts from increased
confidence in the global art market and growth in storage income
from newly opened warehouse facility at Leyton
-- The company will renew its focus on identifying complementary
value enhancing acquisitions, on the basis of sensible purchase
prices, clear synergies and a pathway to sustainable growth.
John Foster, CEO said:
"I am pleased to report on another year of profitable trading
for the Group.
"A less buoyant trading environment in the Falklands saw profits
fall back as expected but both UK businesses made progress despite
challenging market conditions. The Group's balance sheet remains
strong.
"We are actively seeking to strengthen our non-executive board
and hope to appoint a permanent non-executive chairman for
shareholders to approve at the Company's Annual General Meeting on
31 August 2017. Further announcements will follow.
"The Board is also pleased to recommend the reinstatement of a
dividend, at an affordable level, to provide an attractive running
yield for shareholders as well as retaining the majority of profits
to fund organic growth and help finance acquisitions.
"FIH group is well-positioned for the future, and remains
committed to following its strategy to deliver long-term
sustainable growth, through continued organic growth and enhancing
value for shareholders through selective, well-priced
acquisitions."
- Ends -
Enquiries:
FIH group plc
John Foster, Chief Executive Tel: 01279 461630
------------------------------ ---------------------
WH Ireland Ltd. - NOMAD
and Broker to FIH Tel: 0207 220 1666
Adrian Hadden / Alex Bond
------------------------------ ---------------------
FTI Consulting
Edward Westropp / Eleanor Tel: 020 3727 1000
Purdon
------------------------------ ---------------------
Chairman's Statement 2017
It is a pleasure and an honour to report to you as interim
chairman of FIH group plc (the "Group" or "FIH"), especially as the
Group has fulfilled another year of profitable trading in line with
expectations. I refer you to the Chief Executive's Strategic Review
for details of that performance and the outlook. There you will
read about the contributions of our three constituent companies,
Momart, PHFC and of course the Falkland Islands Company ("FIC").
The latter was very much the centre of attention during the recent,
now lapsed, take-over bid from Staunton Holdings and the approach
from the Argentinian Dolphin Fund during the offer period.
Whenever I have visited the Falkland Islands I have been struck
by the warmth of the welcome I have received, the energetic and
independent spirit of the people, the beauty of the land and
seascapes, and the history of the Islands and of FIC. Therefore,
when events earlier this year unfolded to reveal an Argentinian
expression of interest in acquiring the entire share capital of FIH
(something that the independent board members had to treat both
fairly and seriously), it came as no surprise to witness the
concern and objection at many levels in the Falkland Islands raised
by that expression of interest. The implications were very clear:
Argentinian control of FIC would be strongly opposed by Islanders,
damaging to the trading performance of FIC, and potentially
hazardous to FIC's ownership of assets in the Islands. With that in
mind, and with a duty of care to the welfare and prospects of FIC,
the independent board members refused to entertain that expression
of interest.
It has been a privilege, as interim chairman, to steer FIH to
stability following the period of uncertainty caused by the
Argentinian interest and the failed offer for the Group by
Staunton. That offer provided an opportunity for shareholders to
realise value but it did not meet with sufficient support and
caused lively debate among shareholders. I, along with the chief
executive, took that debate to the largest non-Staunton
shareholders representing more than 60% of the share capital. That
consultation was positive, broadly consensual and supportive of the
following three objectives:
-- to reinstate a dividend;
-- to strengthen the board; and
-- to grow by acquisition.
I am pleased to report that efforts on all three are
underway.
A modest dividend is proposed for shareholder approval at the
forthcoming Annual General Meeting. Further details are available
in the Chief Executive's Strategic Review and Directors'
Report.
A search for a permanent, independent non-executive chairman is
advanced and I hope to be able to announce the appointment soon.
Thereafter, the intention is to strengthen the board still further
with the appointment of an independent, fourth non-executive
director.
Edmund Rowland, having relinquished the chairmanship after the
lapse of the Staunton offer, will step down as a non-executive
director and be replaced by Rob Johnston. This reflects the recent
transfer of the single largest shareholding in the Group from
Rowland family ownership to the Trust that Rob Johnston represents.
An announcement will follow the release of these results.
After the distraction and expense of the recent offer period,
the search for a suitable complementary acquisition to add to the
Group is being driven forward in conjunction with professional
advisers. The aim is to acquire a sound and profitable business for
good value in order to increase the earnings base and profitability
of the Group. Renewed energy is going into this project.
Having come through an unprecedented and uncertain six months, I
believe FIH will now benefit from its refreshed shareholder base,
new independent non-executive directors and a determined strategy.
These are all positive developments. There are good opportunities
ahead.
I look forward to seeing as many of you as possible at the
Annual General Meeting at 11.30 a.m. on Thursday 31 August at the
offices of FTI Consulting, 200 Aldersgate, London EC1A 4HD.
Jeremy Brade
Interim Chairman
13 June 2017
Chief Executive's Strategic Review
Group Overview
I am pleased to report on another year of profitable trading for
the Group. Revenues were up GBP1.5 million on last year at GBP40.5
million (2016: GBP39.0 million) and underlying pre-tax profits,
were lower by GBP0.7 million at GBP2.4 million (2016: GBP3.1
million) because of the expected return to more normal trading
levels in the Falklands after a record year in 2015-16.
Reported profits before tax were GBP1.89 million (2016: GBP2.8
million). Operating cash flow remained strong and the Group ended
the year with record levels of cash of GBP15.1 million (2016:
GBP14.0 million).
In the Falklands, with low oil prices contributing to the early
curtailment of exploration drilling in May 2016, demand in the
local economy returned to more normal levels compared to the record
activity seen in the prior year. In the absence of oil related
corporate demand, lucrative high value rental and services income
fell back and retail margins were squeezed as the business faced
the double impact of strengthened local competition and weakening
demand as it fought to maintain market share. This was partially
offset by healthy growth in housebuilding and Penguin Travel
tourist services but overall revenues from the Group's Falkland
operations still fell by 3.6% and FIC's underlying pre-tax
contribution dropped by GBP0.78 million to GBP1.16 million from the
record levels seen in 2016 (GBP1.94 million).
In the UK both the Group's businesses made progress despite
challenging market conditions. At the Group's fine art handling
company Momart, like for like underlying trading profits increased
by GBP0.24 million (+50%), but expected start-up losses of GBP0.2
million from its new art storage warehouse, completed in March
2017, held back Momart's underlying pre-tax contribution to GBP0.52
million slightly ahead of the prior year (2016: GBP0.46 million).
At Portsmouth Harbour Ferry Company ("PHFC"), despite reduced
passenger volumes, revenues remained stable (+1%) and with tight
control of operating costs, underlying profits were slightly ahead
at GBP0.71 million (2016: GBP0.68 million).
Review of operations
Group revenue and Underlying Pre-Tax profits* are analysed
below:
Group revenue
Year ended 31 March 2017 2016 Change
GBPm GBPm %
---------------------------------- ----- ----- ------
Falkland Islands Company ("FIC") 17.82 18.50 -3.6
Portsmouth Harbour Ferry ("PHFC") 4.29 4.24 1.0
Momart 18.38 16.26 13.1
Total Revenue 40.49 39.00 3.8
Group Underlying Pre Tax profit*
Year ended 31 March 2017 2016 Change
GBPm GBPm %
---------------------------------- ----- ----- ------
Falkland Islands Company 1.16 1.94 -40.2
Portsmouth Harbour Ferry 0.71 0.68 4.2
Momart 0.52 0.46 14.7
Rounding 0.01 - -
Total Underlying Pre Tax Profit * 2.40 3.08 -22.2
---------------------------------- ----- ----- ------
Non trading items (see notes below) -0.51 -0.28
Reported Profit Before Tax 1.89 2.80 -32.6
--------------------------- ---- ---- -----
* Pre-tax profit before amortisation of intangibles and
non-trading items, but including the Group's share of the operating
contribution from SAtCO (excluding any impairments or reversal of
impairments of fixed assets), the Group's Joint Venture with Trant
Construction in the Falkland Islands.
Non-trading items of GBP0.51 million comprised GBP0.53 million
of professional advisers costs incurred in dealing with the failed
bid by Staunton Holdings and the defence against a possible bid by
the Argentine controlled, Dolphin Fund, amortisation costs of
GBP0.14 million netted off against GBP0.16 million of profits on
asset disposals.
The following detailed commentary refers to the underlying
trading performance of the business units underlying pre-tax
profits, and excludes non-trading items and charges for the
amortisation of intangibles from the acquisition of Momart.
Falkland Islands Company ("FIC")
In the Falklands, the lack of oil related demand fed through
into weakened general demand for goods and services in the Islands
and the absence of oil related corporate spending saw the
contribution from FIC's property portfolio fall as premium
corporate rental income was exchanged for "local" rentals at a 30%
discount. The contribution from FIC was also adversely affected by
the expansion and further modernisation of FIC's principal retail
competitor, the Chandlery. Despite encouraging sales growth at Home
Builder / Home Living, the more challenging H2 conditions, compared
to record H2 revenues experienced in the prior year, meant total
annual retail sales were 5.5% lower than in 2015-16. (H1 -1.9%, H2
-8.3%, FY -5.5%) With margins under pressure too, the contribution
from FIC's retail operations fell sharply over the year.
Despite increased local competition and the absence of the oil
stimulus, together with the exceptionally poor squid catch at the
start of the financial year, the decline in FIC's profitability was
mitigated by cost savings in central administration, encouraging
performances from FIC's housebuilder, FBS, and Penguin Travel,
combined with continued growth from insurance and consumer
finance.
Income from the Group's construction Joint Venture, SAtCO, also
ceased with the departure of the oil rig in early summer 2016 and
SAtCO's contribution was minimal compared to FIC's share of JV
profits of GBP0.2 million in the prior year. On a more positive
note, the successful disposal of fully written down plant and
machinery in SAtCO's, was achieved by shipping its crawler crane
back to the UK and selling it to a middle-eastern buyer at a small
profit. The contribution from this sale is included in non-trading
income.
In overall terms the pre-tax contribution of the Group's
Falklands' business dropped back from the record levels seen in the
prior year, (2016: GBP1.94 million) and pre-tax profits declined to
more normal "pre-oil" levels of GBP1.16 million.
Oil Development
Although the Group has no direct interest in any of the oil
licences in the Falklands and no longer has any shares in
Falklands' oil exploration companies, future oil development in the
Islands would be a significant value driver for both the wider
Falklands economy and by extension for FIC.
With the cessation of exploration drilling in May 2016, the
principal exploration licence holder, Premier Oil ("Premier") has
focussed on completing the Front End Engineering and Design (FEED)
for the Sea Lion field in the North Falklands Basin and reported in
March 2017 that this work was now substantially complete. The
detailed FEED planning process and engagement with suppliers has
enabled Premier to reduce the projected break-even cost of
developing Sea Lion to $45bbl with upfront capital expenditure to
"First Oil" now reduced to $1.5bn. Premier has also progressed
discussions with the Falklands Islands Government (FIG) and agreed
an extension to its licence over Sea Lion until April 2020.
Following the last round of drilling in 2015-16 Premier reported
that Sea Lion has estimated recoverable resources of at least
520mbbls with further potential from the Isobel field to the South
of Sea Lion. Although these developments are positive, Premier's
balance sheet is highly leveraged and the company's management has
made it clear that it will need a strong farm-in partner to take on
the cash cost and upfront investment required to move ahead to
develop its Sea Lion licence. With crude oil prices slipping back
below $50bbl in the late spring of 2017, the economics of
developing the Sea Lion licence in the near term are uncertain. In
the medium term, much will depend on a stable and improving outlook
for long term oil prices together with the Falklands' basin
becoming relatively more attractive compared to other alternative
sources of hydrocarbons.
Trading in Detail
Overall revenue in FIC dropped by 3.6% to GBP17.8 million (2016:
GBP18.5 million).
FIC Operating results
Year ended 31 March 2017 2016 Change
GBPm GBPm %
-------------------------------- ----- ----- ------
Revenues
Retail 9.14 9.66 -5.5
Falklands 4x4 3.02 3.93 -23.0
FBS (property and construction) 2.68 1.81 48.5
Freight & Port Services 0.93 0.90 3.8
Support services 1.63 1.63 -0.7
Property rental 0.42 0.57 -25.0
Total FIC revenue 17.82 18.50 -3.6
FIC underlying operating profit 1.21 1.82 -33.5
Share of results of SAtCO JV 0.02 0.20 -88.0
Net interest expense -0.07 -0.08 -9.8
-------------------------------- ----- ----- ------
FIC underlying Profit Before
Tax 1.16 1.94 -40.2
-------------------------------- ----- ----- ------
FIC underlying operating profit
margin 6.8% 9.8% -31.0
-------------------------------- ----- ----- ------
Total retail sales in FIC decreased by 5.5% to GBP9.14 million,
down GBP0.52 million from the record levels seen in the previous
year of GBP9.66 million.
West Store retail sales declined due principally to the
slow-down in the Falklands economy resulting from the absence of
oil exploration activity. Sales were also adversely affected by the
expansion and further modernisation of FIC's principal retail
competitor, the Chandlery, whose 33% expansion in retail space in
November 2016, inevitably drew customers and sales from the FIC's
flagship West Store which saw a 6.2% reduction in sales over the
year compared to only a 1.6% reduction in the first half. However,
the effects of the Chandlery's expansion will wash through in the
first 7 months of the new financial year and thereafter West Store
sales are expected to stabilise.
Warehouse sales to local retailers and pubs (10% of West Store
sales) fell by 2.5%. Despite progress in winning back local market
share, weaker local demand and direct internet based sourcing from
the UK created challenging trading conditions, albeit the much
larger double digit declines in sales seen in recent years were
halted.
Sales at the Capstan gift shop decreased by 12.7% despite total
cruise ship numbers landing in Stanley being maintained at close to
prior year levels (55,600 vs 56,500 in 2015-16) as the absence of
high spending oil support workers was felt. The same effect also
hit sales at FIC's general store at the Mount Pleasant military
base ("West Store MPA") where with fewer visiting workers
transiting through the airport base, sales at the MPA "airport
store" fell by 17.1% over the full year.
On a brighter note, at Home Living, sales recovered from a poor
2015-16 as housing completions under the government's subsidised
scheme surged, boosting demand for home furnishings and this
together with the benefit of a full year's trading from the new
in-store café helped revenues increase by 22.9% (+GBP0.1 million)
over the year. At FIC's Builder's Merchant "Home Builder", despite
muted local demand, sales increased by 2.0%. Both "Home" businesses
benefited from the much improved access and off street parking
offered by the new customer car park at Crozier Place, which was
completed in February 2016.
Despite encouraging performances from Home Living and Home
Builder, and strict cost control across all retail departments, the
overall retail environment in the Falklands was challenging with
both revenues and margins under pressure, particularly in H2.
However positive steps to reduce retail stock were successful and
with hard work from the local team, GBP1.1 million of cash was
released through the more effective management of stock.
In FIC's automotive business, Falklands 4x4, after a record year
in 2016, overall revenues dropped by 23% to GBP3.02 million (2016:
GBP3.93 million) as sales of new vehicles fell by 47% reflecting
weakened local demand and the tailing off of sales of the old but
much loved Land-Rover Defender which has now been discontinued by
the manufacturer. Income from car hire also decreased as oil
related corporate demand fell away. However, revenues from used
vehicle sales increased modestly and income from servicing and
repairs also increased helping to mitigate the decline. Vehicle
unit sales fell from 110 (including 54 new vehicle sales) in the
prior year, to 77 of which 29 were new vehicles.
Falkland Building Services (FBS), which focusses on building kit
homes and small local construction projects, saw revenues increase
by 49% to GBP2.68 million (2016: GBP1.81 million) as the number of
new houses completed for local residents rose from 12 last year to
17. With new house sales at just below GBP2 million, revenue was
also boosted by healthy increases in small contracts and government
work for FIG, and this more than compensated FBS for the decline in
oil related construction activity.
FBS also completed the final phase of FIC's warehouse expansion
at Airport road on the outskirts of Stanley with the construction
of a new smaller warehouse for third party freight. This now leaves
the old warehouse site in central Stanley available for future
development and has removed heavy container traffic from the town
centre and tourist sea front areas.
Despite a drop in southbound volumes as the economy slowed,
revenues from Third Party Freight and Port Services were largely
unchanged at GBP0.93 million because of an offsetting increase in
northbound cargoes as the oil exploration companies withdrew their
support infrastructure in Stanley.
Support Services income held up well at GBP1.63 million (2016:
GBP1.63 million) despite a fall in Fishing Agency revenues
following the sharp fall in the illex squid catch early in the
year. Penguin Travel had another strong year with income ahead by
17% as relationships with leading cruise operators were
strengthened and income from consumer finance, reported as interest
income, continued to rise. As in previous years there was steady
progress at FIC's insurance agency.
As expected with the departure of the oil companies the level of
corporate demand for Property Rental, from FIC's estate of 51
rental properties (which include 10 mobile homes rented to staff),
fell back as premium rentals declined, and occupancy levels were
initially affected. Rental income fell by 25% and average occupancy
went down from 93% to 81% albeit it recovered steadily throughout
the year as local tenants replaced outgoing corporate lets.
As expected, activity in FIC's joint venture, the South Atlantic
Construction Company, ("SAtCO") which was linked very closely to
infrastructure projects for the oil industry, fell sharply in the
year and SAtCO's contribution in the year was minimal. In the year
to 31 March 2017 the Group's share of the after tax profits of
SAtCO was GBP0.02 million (2016: GBP0.2 million). However FIC was
successful in arranging the repatriation and ultimate sale of
SAtCO's 250 tonne crawler crane generating GBP205,000 of net
proceeds of which the Group's share after tax amounted to
GBP81,000.
FIC Key Performance Indicators and Operational Drivers
Year ended 31 March 2013 2014 2015 2016 2017
-------------------------- ----- ----- ----- ------ -----
Staff Numbers (FTE
31 March) 129 165 184 172 151
-------------------------- ----- ----- ----- ------ -----
Capital Expenditure
GBP'000 1,594 2,715 2,598 1,229 578
-------------------------- ----- ----- ----- ------ -----
Retail Sales growth
% 3.0% -4.8% 3.0% 1.3% -5.5%
-------------------------- ----- ----- ----- ------ -----
Number of FIC rental
properties 32 36 50* 50* 51*
-------------------------- ----- ----- ----- ------ -----
Average occupancy
during the year 88% 82% 93% 93% 81%
-------------------------- ----- ----- ----- ------ -----
Number of vehicles
sold 48 79 76 110 77
-------------------------- ----- ----- ----- ------ -----
Number of 3(rd)
party houses sold 3 8 16 12 17
-------------------------- ----- ----- ----- ------ -----
iIlex squid catch
in tonnes (000's) 58.2 188.0 364.0 235.2 30.1
-------------------------- ----- ----- ----- ------ -----
Cruise ship passengers
(000's) 29.6 39.5 50.0 56.5 55.6
-------------------------- ----- ----- ----- ------ -----
*Includes ten mobile homes rented to staff.
FIC ended the year with a headcount of 151, 21 lower than in
March 2016. Year on year savings of c GBP0.2 million were effected
in early 2016 by a reduction in administrative overheads and
further headcount cuts were made in retail operations during the
year in anticipation of the return to more normalised trading. Of
the 151 headcount, Retail accounted for 56, Falklands 4x4 for 19
and FBS for 38, with the balance of 38 in Support Services and
administration.
In overall terms profitability in the Group's Falkland
operations fell back from the record levels of GBP1.9 million seen
in 2015-16 to a similar level to that seen in the year to 31 March
2014, (GBP1.0 million PBTa) when there was little oil exploration
activity in the Islands.
While oil development remains subject to continuing uncertainty,
the Falklands' economy is expected to stabilise around current
levels sustained by the traditional areas of squid fishing and
tourism ensuring a healthy base level of profitability is
maintained at FIC.
Portsmouth Harbour Ferry Company ("PHFC")
2016-17 saw another steady performance from PHFC, with total
revenue increasing by 1.0% after a 4.1% decline in passenger
numbers, was more than offset by increases in the yield from ferry
fares. Profit Before Tax after pontoon lease and boat loan interest
charges, was 4.2% ahead of the prior year at GBP0.71 million (2016:
GBP0.68 million).
PHFC Operating results
Year ended 31 March 2017 2016 Change
GBPm GBPm %
-------------------------- ----- ----- ------
Revenues
Ferry fares 4.13 4.09 0.8
Cruising and Other
revenue 0.16 0.15 7.2
Total PHFC revenue 4.29 4.24 1.0
-------------------------- ----- ----- ------
PHFC underlying operating
profit 1.06 1.03 2.9
Boat loan & Pontoon
finance lease interest -0.35 -0.35 0.3
-------------------------- ----- ----- ------
PHFC underlying Profit
Before Tax 0.71 0.68 4.2
-------------------------- ----- ----- ------
PHFC underlying operating
profit margin 24.7% 24.2% 1.9
Passengers carried
(000s) 2,710 2,826 -4.1
-------------------------- ----- ----- ------
2016-17 saw a continued decline in ferry passenger numbers,
which reduced 4.1% over the year to 2.710 million (an average of
7,400 passengers per day), from 2.826 million in the prior year.
The rate of decline was exacerbated by the impact of the
redevelopment by Portsmouth City Council of the passenger
interchange at the Portsmouth terminal which continued throughout
the entire year. The overall rate of decline slowed in the second
half down from the -4.7% reported in H1 to -3.6% in H2.
Ferry fares were increased by an average of 3% in June 2016,
bringing the total cost of a standard adult return to GBP3.40, and
the price of Adult 10 Trip tickets for regular customers was
increased to GBP15.00 (GBP1.50 per ferry journey). Discounted
tariffs for seniors and children were also increased by 10p
(GBP2.30/GBP2.20 return). Monthly and quarterly season tickets
which offer the best value for money for very frequent users
allowing unlimited ferry travel continued to be available priced at
GBP61 and GBP170 respectively.
During the summer months the annual "Bikes Go Free" promotion
(normal tariff GBP1.20 return) was offered once more from 1st June
to 1st September to encourage long term cycle use. Cyclists now
account for over 10% of all ferry users.
Customer interest in the unlimited monthly ferry and car parking
joint ticket "Park & Float" ticket at GBP89 increased by 58%
over the year but despite its outstanding value for money, total
take up remained modest at just over 1% of passenger traffic. In
contrast the discounted ticket for military personnel was more
popular accounting for 3.8% of passenger journeys in the year, up
0.2% on the prior year. Demand for the Solent Go regional "Oyster"
travel card continued to increase further to 3.6% of ferry users,
up 50% on the prior year.
In overall terms at under GBP1.60 per crossing for adults,
(GBP1.05 for seniors and children) the ferry service still
represents excellent value compared to any alternative mode of
transport other than for groups travelling by car with free or
subsidised parking.
As in prior years, the car continues to be the only serious
transport alternative to the ferry for travelling between Gosport
and Portsmouth. The subsidised Park & Ride scheme operated by
Portsmouth City Council remained a major factor in increasing the
appeal of car travel with dedicated buses departing every 10
minutes to Portsmouth town centre, the Naval Dockyard and the
Gunwharf Quays shopping centre. With keen Park & Ride pricing
including new 10 trip tickets at GBP3 per car, low petrol prices (
20% cheaper than in 2014 ) and increasingly efficient cars, the
economics of car travel under the scheme are attractive for family
leisure travel and daily commuting when there are more than 2
passengers per vehicle. As such the scheme continues to have a
direct, adverse impact on ferry passenger volumes.
In the year to 31 March 2017, in contrast to the prior year,
weekday traffic was marginally less affected than traffic at
weekends with an overall decline of -3.9% compared to -4.6% at
weekends although peak time commuter traffic experienced slightly
greater declines of 4.3% compared to only 2.8% for weekday off peak
passengers.
Cruising income continued to make a modest but profitable
contribution to the business with 38 leisure cruises in the Solent
area over the summer and together with ferry advertising income
other revenues increased by 7.2% from GBP0.15 million to GBP0.16
million. In early 2017 PHFC benefited from the sale of the last of
its 1966 vintage vessels, Gosport Queen, which was sold to a Thames
river cruise operator. The profit on sale of GBP0.08 million is
included in non-trading income.
With the sale of the last of the "Queens", PHFC has 3 reliable
modern vessels to support its passenger service (2 on daily
operations and one on stand-by) and with an estimated service life
of over 30 years, no further significant vessel expenditure is
anticipated for over 15 years.
Key Operating Metrics
Average fare yield per passenger journey increased by 4.8% to
GBP1.52 (2016: GBP1.45).
Ferry reliability was again outstanding with on-time departures
running at 99.9% (2016: 99.8%).
Outlook
Looking ahead for 2017-18 completion of the passenger
interchange at the Portsmouth Hard is scheduled for June 2017 and
with its wider pedestrian walkways and more comfortable and
efficient links between ferry buses and taxis the modernised
passenger terminus should provide a more attractive and seamless
interchange for public transport users and help boost ferry
numbers.
The arrival of the Royal Navy's new aircraft carriers has been
subject to delay but HMS Queen Elizabeth, the largest ship ever
built for the Royal Navy, is finally due to arrive in Portsmouth
Harbour in late 2017, after completion of sea trials. The
significant maintenance regime to keep her fully operational is
expected to boost employment at the naval dockyard and be a
positive factor for passenger volumes.
Plans for the redevelopment of the Gosport bus station adjacent
to the ferry terminal are developing slowly although there is now
firm private sector interest in creating new retail and leisure
facilities which should increase the appeal of the Gosport
waterfront / ferry terminal area as a destination and thus enhance
the medium term outlook for passenger numbers.
PHFC Key Performance Indicators and Operational Drivers
Year ended 31 March 2013 2014 2015 2016 2017
---------------------------- -------- -------- -------- -------- --------
Staff Numbers ( FTE
at 31 March) 35 37 39 38 38
---------------------------- -------- -------- -------- -------- --------
Capital Expenditure
GBP'000's 223 1,958 1,483 223 241
---------------------------- -------- -------- -------- -------- --------
Ferry Reliability
(on time departures) 99.5% 99.7% 99.8% 99.8% 99.9%
---------------------------- -------- -------- -------- -------- --------
Number of weekday
passengers '000 2,230 2,169 2,123 2,046 1,967
---------------------------- -------- -------- -------- -------- --------
% change on prior
year -10.7% -2.7% -2.1% -3.6% -3.9
---------------------------- -------- -------- -------- -------- --------
Number of weekend
passengers '000 803 817 800 780 744
---------------------------- -------- -------- -------- -------- --------
% change on prior
year -3.4% 1.8% -2.1% -2.5% -4.6
---------------------------- -------- -------- -------- -------- --------
Total number of passengers
'000's 3,033 2,986 2,923 2,826 2,710
---------------------------- -------- -------- -------- -------- --------
% change on prior
year -8.9% -1.6% -2.1% -3.3% -4.1%
---------------------------- -------- -------- -------- -------- --------
Revenue growth % -1.9% 1.2% 4.3% -1.3% 1.0%
---------------------------- -------- -------- -------- -------- --------
Average yield per GBP1.45 GBP1.52
passenger journey* GBP1.28 GBP1.32 GBP1.41
---------------------------- -------- -------- -------- -------- --------
*Total ferry fares divided by the total number of passengers
Momart
Momart, the Group's art handling and logistics business,
delivered a modest increase in Operating Profit, despite
challenging market conditions. Overall revenues increased by 13.0%
to GBP18.4 million (2016: GBP16.3 million) led by exceptionally
strong growth in the value of work done for leading museums
(+19.9%). Despite a less lucrative sales mix, and pressure on
margins, the strong growth in revenue meant that on a like for like
basis, underlying profits increased by GBP0.25 million to GBP0.71
million, although start-up costs of GBP0.18 million from the newly
expanded storage facilities at Leyton held back profit growth, so
that underlying operating profits increased only marginally to
GBP0.54 million from GBP0.46 million in 2016.
Net finance costs in the year were negligible as borrowings were
repaid during the year, although a further GBP1.0 million bank loan
was drawn down in December 2016 to finance the fit out of the new
warehouse extension at Leyton
Underlying Profit Before Tax before amortisation of intangibles
was GBP0.52 million (2016: GBP0.46 million)
Momart Operating results
Year ended 31 March 2017 2016 Change
GBPm GBPm %
-------------------------------- ------------ ------------ ------
Revenues
Museum Exhibitions 10.06 8.39 19.9
Galleries & Private Clients 6.29 5.82 8.1
Storage 2.03 2.05 -0.8
Total Momart revenue 18.38 16.26 13.0
Momart underlying operating
profit 0.54 0.46 17.0
Net Interest expense -0.02 - -
-------------------------------- ------------ ------------ ------
Momart underlying Profit Before
Tax 0.52 0.46 14.7.0
-------------------------------- ------------ ------------ ------
Momart underlying operating
profit margin 2.9% 2.8% 1.4
-------------------------------- ------------ ------------ ------
Museum Exhibitions
After an exceptionally strong start in H1 with revenue +30%
compared to H1 in the prior year, the rate of Exhibition revenue
growth slowed in H2 but still showed healthy growth with museum
sales up by 11.4% on the prior year, leading to annual sales growth
of 19.9% and record levels of activity with UK museums. Revenue
from large UK museum exhibitions, continue to form the bedrock of
Momart's market-leading reputation, and accounted for more than
half of total Exhibition activity with sales to the top 10 UK
museums representing 55% of Exhibitions revenue (2016: 51%). Work
with overseas museums, either directly or through agents accounted
for 28% of Exhibitions revenue (2016: 29%) with services to smaller
UK museums accounting for 17% of Exhibitions revenue.
Although the increase in Exhibitions' Museum sales was
encouraging, museum budgets in the UK and overseas are under
intense and increasing pressure with ever more emphasis being
placed on price in the tender process and this has led to pressure
on margins and contract profitability becoming increasingly
squeezed. In addition, fluctuations in sales mix, particularly the
proportion of works provided by lenders located overseas, plays a
major factor in determining gross margin, as work that requires
outsourcing to overseas partners commands only a modest mark up for
the co-ordinating agent. In 2016-17 the proportion of low margin
work that required outsourcing to overseas agents increased by 3.4%
points on the prior year, and these lower margin sales accounted
for GBP1.6 million (75%) of the total increase in Exhibitions
revenues of GBP2.1 million. Revenue from Momart's own added value
services to Exhibition clients increased by GBP0.5 million (+7.3%)
helped by a GBP0.4 million increase (+16.6%) in work for
international clients.
Notable museum exhibitions delivered for UK clients in the
period included the installation of "Abstract Expressionism" at the
Royal Academy, "Sunken Cities" at the British Museum, "Painters
Paintings" and "Beyond Caravaggio" at the National Gallery,
"Francis Bacon Invisible Rooms" at Tate Liverpool, "William
Eggleston" and "Picasso" at the National Portrait Gallery, "You Say
You Want a Revolution" " at the V&A, and "The Radical Eye" at
Tate Modern.
As at 31 March 2017, the value of Momart's 12 month order-bank
of large UK Exhibitions had increased by GBP0.3 million compared to
the prior year-end, to a record level of GBP4.8 million (See KPI's
below). This healthy order book provides a solid platform for
Exhibition sales in the coming year.
Galleries & Private Client Services
Gallery Services had an encouraging year despite fierce
competition at a period when there was a notable softening in the
global art market. During 2016 international auction houses
experienced weaker client demand and hammer prices fell below
expectations particularly in the early part of the year. Despite
this unpromising backdrop, Momart's Gallery Services team delivered
sales growth of 8.1% achieving record revenues of GBP6.3 million
(2016: GBP5.8 million) whilst still maintaining healthy
margins.
International galleries remain the most important client
category and after strong sales growth in the prior year, revenue
from galleries grew by a further 25% to reach record levels. Sales
to auction houses fell back slightly (-1.4%) reflecting the
slow-down in the commercial art market, although run rates picked
up towards the end of the financial year as confidence returned at
the start of 2017. Activity with private clients fell back by 11%
mirroring market uncertainty but revenues from corporate clients
increased by a welcome 3%. Momart's close connection with major
artists, as an art handler able to meet the most demanding
technical requirements and standards of care, was reinforced by
encouraging sales growth of 17% with living artists. After
commercial galleries and auction houses this key client group
remains central to Momart's activities and reflects the company's
core values of client service, attention to detail and respect for
the works themselves.
During the year, further resources were invested in sales and
marketing, business development, staff training and improved IT
systems, increasing general overheads by GBP0.4 million compared to
the prior year. This strengthening of the company's sales
infrastructure will support further organic growth in the coming
years.
Storage
Storage revenues were essentially unchanged at GBP2.03 million
(2016: GBP2.05 million), as existing facilities remained at full
capacity. During the year the main strategic focus was to ensure
the completion and client readiness of the new storage unit at
Leyton although snagging issues and contractor insolvency meant
final commissioning of the new facilities was delayed until March
2017. Storage revenues earned in the 2016-17 financial year from
the new "Unit14" were negligible and start-up costs (rent &
rates etc) of GBP0.18 million were incurred while the unit remained
subject to final completion. Early reaction to the new facilities
which offer improved client facilities, discrete dedicated space
for specific collections and enhanced viewing areas, has been very
positive and sales and promotional initiatives are underway to
ensure the speediest possible fill of the new unit which will add
33% to storage capacity together with GBP0.5 million in annual
operating costs. Depending on market conditions it is hoped to fill
the new unit within 18 months, with cash break-even on a monthly
basis achieved within 7 months. Given the profile of fixed property
costs from the outset and a steady build-up of revenue, if the unit
is 2/3(rd) full by March 2018, and at that point covering its cash
costs and monthly depreciation, deficits in the early months will
still lead to a further small loss of c GBP0.2 million in the first
year of operation, after which once mature and fully let it will
become a steady profit and cash flow generator.
Momart Key Performance Indicators and Operational Drivers
Year ended 31 2013 2014 2015 2016 2017
March
--------------------- -------- --------- -------- -------- --------
Staff Numbers
(FTE 31 March) 119 125 129 130 131
--------------------- -------- --------- -------- -------- --------
Capital Expenditure
GBP'000's 598 260 648 402 971
--------------------- -------- --------- -------- -------- --------
Warehouse % fill
vs capacity 94.2% 92.9% 91.2% 90.6% 90.4%
--------------------- -------- --------- -------- -------- --------
Exhibition Order GBP4.5m GBP4.8m
Book 31 March GBP3.8m GBP3.9m GBP3.3m
--------------------- -------- --------- -------- -------- --------
Momart services GBP9.0m GBP11.7m GBP9.1m GBP9.2m GBP9.8m
charged out
--------------------- -------- --------- -------- -------- --------
Revenues from GBP4.6m GBP8.3m GBP7.5m GBP5.8m GBP6.1m
overseas clients
--------------------- -------- --------- -------- -------- --------
Exhibitions sales
growth 27.8% 20.4% -20.0% -3.4% 19.9%
--------------------- -------- --------- -------- -------- --------
Gallery Services
sales growth -12.7% 1.3% -6.5% 11.8% 8.1%
--------------------- -------- --------- -------- -------- --------
Storage sales
growth 10.5% 2.6% 1.3% 10.1% -0.8%
--------------------- -------- --------- -------- -------- --------
Total Sales growth 8.9% 12.0% -13.7% 3.2% 13.0%
--------------------- -------- --------- -------- -------- --------
Trading outlook
FIC
For the year ahead, we anticipate another quiet trading period
in the Falklands. Local competition remains a significant factor,
particularly in Retail, as the full effects of the Chandlery's
expansion wash through in the first half. However property rental
income has now stabilised and housebuilding remains buoyant on the
back of continued government subsidies for first time local buyers.
Further growth in FIC's consumer finance business is anticipated
and a steady performance is also expected from insurance broking,
4x4 sales and vehicle maintenance.
In the near term, an improved squid catch should help general
confidence and a further stimulus from government infrastructure
projects may emerge following the quadrennial Legislative Assembly
elections in November 2017. Further oil development awaits an
improved outlook for the global oil price and the emergence of a
financially strong "farm-in" partner to help develop Premier Oil's
"Sea Lion" acreage. With respect to tourism, continued growth is
expected from cruise ship activity but negotiations with Argentina
concerning flight permissions for new scheduled flights from South
America which have the potential to unlock land-based tourism,
remain unresolved and no significant stimulus from new flights is
expected in the coming year.
PHFC
At PHFC, the emphasis in the coming year will continue to be on
tight cost control and on maintaining the ferry's excellent safety
and reliability record. The disruptive council construction works
at the passenger interchange in Portsmouth are expected to be
complete by June 2017; this and the arrival of the new carrier HMS
Queen Elizabeth late in 2017, should provide some modest stimulus
to passenger volumes over the year. With its core fleet of 3 modern
passenger vessels, ongoing capital expenditure at the ferry will be
modest and underlying cash flow from ferry operations will continue
to be strong.
Momart
At Momart, increased confidence in the global art market was
reflected in more buoyant auction house sales, in spring 2017 and
although competition remains intense, this should help drive
further growth in Momart's services to private collectors,
galleries and auction houses. Museum exhibitions work remains very
price competitive and only limited growth is anticipated in this
sector and the focus will be on higher added value contracts where
Momart's unique expertise can come fully into play. In the coming
year, the key priority will be to fill the company's newly opened
storage facility at Leyton as quickly as possible to expand
business with private collectors and galleries and to create a
platform for further growth.
Acquisitions
Following the abortive take-over bid from Staunton Holdings, the
search for complementary value enhancing acquisitions has been
resumed, with the aim of increasing the group's earnings base,
market capitalisation and appeal for investors. This appeal will be
further enhanced by the resumption of dividends set at a sensible
level in order to provide a modest yield whilst preserving the
Group's cash resources for meaningful and accretive acquisitions.
To avoid dilution of management resources, the main geographic
focus will be on businesses based in the UK. A number of
discussions have been held with businesses in the field of art
logistics which, if progressed, would complement and extend Momart.
These opportunities will continue to be explored but only on the
basis of sensible purchase prices, clear synergies and a pathway to
sustainable growth. If these opportunities do not yield positive
results, expansion and investment in other high value specialist
services will be considered as an alternative. Strategic
opportunities for expansion and further investment in the Falklands
will also be considered working in partnership with other
specialist service providers on any larger projects which may
emerge.
The guiding principle of our strategy is to deliver long-term
sustainable growth, through continued organic growth and enhancing
value for shareholders through selective, well-priced acquisitions.
The Board is taking active measures to search for
opportunities.
John Foster
Chief Executive
13 June 2017
Chief Executive's Strategic Review (continued)
Financial Review
Revenue and underlying operating profit
Group revenue rose 3.8% to GBP40.5 million, however, underlying
operating profit decreased 19.3% to GBP2.8 million in the year
ended 31 March 2017 (2016: GBP3.5 million) as profits at FIC fell
back as oil exploration activity in the Falklands ceased in early
2016, and underlying operating profits in the Falklands, including
the joint venture result, which had benefited from crane hire to
Premier in the prior year, fell GBP0.8 million to GBP1.2 million.
On a more positive note, trading profits at PHFC and Momart were
slightly ahead of the prior year.
Non-trading items
Non-trading items amounted to a net cost of GBP0.51 million
(2016: GBP0.28 million), and comprised a GBP0.08 million profit on
the sale of "Gosport Queen", which had been purchased by Portsmouth
Harbour Ferry Company in 1966, and a GBP0.08 million profit
incurred in the Joint Venture on the sale of the SAtCO crawler
crane, which had been returned to the UK following the end of the
drilling contract in the Falklands. These non-trading gains have
been offset against:
-- GBP0.53 million of professional fees incurred from the failed
Takeover Bid by Staunton Holdings Limited, and the further costs
incurred in defending the Group against a possible bid by the
Argentine controlled, Dolphin Fund.
-- GBP0.14 million amortisation charge of intangible assets, in
relation to the net book value of Customer relationships acquired
within Momart in March 2008.
Net financing costs
The Group's net financing costs at GBP0.4 million are similar to
the prior year, as the slight increase in bank interest payable
from the new bank loan drawn down by Momart in December 2016, has
been offset against the reduction in interest payable at the Ferry,
as the loans have been repaid during the year.
Underlying pre-tax profit
As expected, the Group reported underlying pre-tax profits of
GBP2.40 million, 22.2% down on the prior year, (2016: GBP3.08
million).
Reported pre-tax profit
After the non-trading items noted above, reported Profit Before
Tax for the Group decreased by 32.6% to GBP1.89 million (2016:
GBP2.80 million).
Taxation
The Group pays corporation tax on its UK earnings at 20% and on
earnings in the Falkland Islands at 26%. The Falkland Islands
Company Limited, which is resident in both jurisdictions, has been
granted a foreign branch exemption, and as a result no longer pays
UK corporation tax. As a result FIC enjoys the full benefit of the
tax deductibility in the Falkland Islands of expenditure on
commercial and industrial buildings. The effective blended tax rate
on underlying profits is 20.5% (2016: 22.7%).
Chief Executive's Strategic Review (continued)
Earnings per share
Year ended 31 March 2017 2016
------
Change
GBPm GBPm %
--------------------------------- ------ ------ ------
Underlying profit before tax 2.40 3.08 -22.2
Taxation on underlying profit (0.49) (0.70) -29.9
Underlying profit after tax 1.91 2.38 -19.9
Diluted average number of shares
in issue (thousands) 12,431 12,384 0.4
Effective underlying tax rate 20.5% 22.7% -1.2
Basic EPS on underlying profit 15.4p 19.2p -20.1
--------------------------------- ------ ------ ------
Diluted EPS on underlying profit 15.3p 19.2p -20.2
--------------------------------- ------ ------ ------
Basic EPS on reported profit 11.5p 18.0p -36.0
--------------------------------- ------ ------ ------
Diluted EPS on reported profit 11.5p 17.9p -36.0
--------------------------------- ------ ------ ------
Fully diluted Earnings per Share ("EPS") derived from Underlying
Profits, fell to 15.3 pence (2016: 19.2 pence), due to the fall in
the underlying profit before tax.
Dividend
As noted in the Chairman's Statement, the Board is also pleased
to recommend the reinstatement of a dividend. By setting the
dividend at an affordable level, the new dividend payment policy
will allow the retention of the majority of profits to fund organic
growth and to help finance acquisitions, whilst at the same time
providing an attractive running yield for shareholders. Our new
policy will be to pay a cash dividend which will be targeted to be
three times covered by after tax profits. For the year ended 31
March 2017, subject to approval by shareholders at our AGM on 31
August 2017 the Company will declare a final dividend of 4 pence
per share to be paid on 22 September 2017 to shareholders on the
register at close of business on 1 September 2017.
Balance sheet
The Group's Balance Sheet remains strong. Total net assets,
including intangible assets of GBP11.8 million (2016: GBP12.0
million), increased to GBP39.7 million from GBP38.6 million in the
prior year. The carrying value of intangible assets at GBP11.8
million has reduced from the GBP12.0 million at 31 March 2016, due
to the amortisation charge.
Retained earnings, after providing for corporation tax,
increased by GBP1.2 million to GBP20.0 million (2016: GBP18.8
million). Bank borrowings increased to GBP3.8 million (2016: GBP3.3
million), due to the drawdown of a GBP1.0 million loan at Momart to
cover the storage facility development. The Group's cash balances
increased by GBP1.1 million to GBP15.1 million (2016: GBP14.0
million).
The net book value of property, plant and equipment increased by
GBP0.2 million to GBP20.1 million (2016: GBP19.9 million) after
capital investment of GBP1.8 million, including GBP1.0 million at
Momart, largely due to the new storage facilities in Leyton. This
has been offset against a GBP1.3 million depreciation charge in the
year and GBP0.1 million of the hire fleet transferred to stock and
sold through Falklands 4x4.
The Group owns investment properties, comprising commercial and
residential properties in the Falkland Islands held for rental,
together with approximately 400 acres of land in and around
Stanley. This includes 18 acres for industrial development and 25
acres of prime mixed-use land. The Group owns 51 properties for
rental, including 41 investment properties, which are mainly
houses, in Stanley and ten mobile homes, which are rented to staff.
The number of properties, which all are held at depreciated cost,
has increased by one compared to the prior year due to the rental
of a former FIC warehouse to a third party. The net book value of
the investment properties and undeveloped land of GBP3.7 million
(2016: GBP3.6 million) has been reviewed by the Directors resident
in the Falkland Islands and at 31 March 2017 the fair value of this
property portfolio was estimated at GBP7.2 million (2016: GBP7.0
million), an uplift of GBP3.5 million on net book value. FIC's
portfolio of 700 acres of freehold land has a net book value of
GBP0.7 million and an estimated current value at 31 March 2017 of
GBP2.2 million (2016: GBP2.2 million).
Deferred tax assets relating to future pension liabilities
increased to GBP0.8 million (2016: GBP0.7 million). These assets
now only include the deferred tax on the FIC unfunded scheme
calculated by applying the 26% Falklands' tax rate to the pension
liability. The deferred tax asset increased, as the pension
liability rose due to a change in assumptions made at the year-end,
principally due to the decrease in the discount rate.
Inventories, which largely represent stock held for resale in
the Falkland Islands, were reduced by GBP0.8 million to GBP5.4
million at 31 March 2017 (2016: GBP6.2 million), as a result of
focussed stock management implemented in the Falkland Islands.
Trade and Other Receivables increased by GBP1.6 million to
GBP5.5 million at 31 March 2017, due to the completion of large
sales contracts in March at Momart and an increase in debtors at
FIC due to a better start to the Fishing season in March 2017.
These timing differences are expected to reverse in the coming
financial year, Due to the increased year end receivables at
Momart, average debtor days outstanding were 52 (2016: 33).
The Group's cash balances increased to GBP15.1 million (2016:
GBP14.0 million).
Bank borrowings rose to GBP3.8 million from GBP3.3 million due
to the new loan drawn down in December 2016 by Momart to fund the
storage expansion.
Outstanding finance lease liabilities totalled GBP5.0 million
(2016: GBP5.1 million). GBP4.8 million (2016: GBP4.9 million) of
the finance lease balance is in respect of the 50 year lease from
Gosport Borough Council for the Gosport Pontoon, which runs until
June 2061.
In common with most large UK companies, the Group pays the
majority of its corporation tax by means of payments on account.
Residual corporation tax due for payment within the next 12 months
is GBP0.2 million (2016: GBP0.03 million).
Trade and other payables increased to GBP12.3 million from
GBP11.2 million at 31 March 2016, reflecting increased trading
activity.
At 31 March 2017, the liability due in respect of the Group's
defined benefit pension scheme in the Falkland Islands was GBP3.0
million (2016: GBP2.6 million). The increased liability is due
principally to lower medium term interest rates used to discount
the scheme's future liabilities. The pension scheme in the
Falklands, which was closed to new entrants in 1988 and to further
accrual in 2007, is unfunded and liabilities are met from operating
cash flow. The increase in liability has been fed through reserves
in accordance with IAS 19.
The Group's deferred tax liabilities, excluding the pension
asset at 31 March 2017, were GBP2.2 million and increased by GBP0.1
million from the prior year (2016: GBP2.1 million). GBP2.0 million
of this balance arises on property, plant and equipment, and is
principally due to accelerated capital allowances on the new vessel
in PHFC and also to properties in the Falklands, where capital
allowances of 10% are available on the majority of the FIC
properties. With such assets depreciated over 20-50 years, a
temporary difference arises, on which deferred tax is provided.
Net assets per share were 320 pence at 31 March 2017 (2016: 310
pence).
Chief Executive's Strategic Review (continued)
Cash flows
Operating cash flow
Net cash flow from operating activities was GBP2.5 million
(2016: GBP4.3 million); with the decrease due to the increased
level of debtors in Momart at the end of the current year.
The Group's Operating Cash Flow can be summarised as
follows:
Year ended 31 March 2017 2016 Change
GBPm GBPm GBPm
------------------------------------- ------ ------ -------
Underlying profit before tax 2.4 3.1 (0.7)
Depreciation & Amortisation 1.5 1.5 -
Net Interest payable 0.4 0.4 -
------------------------------------- ------ ------ -------
EBITDA 4.3 5.0 (0.7)
Share based payments - 0.1 (0.1)
Increase in hire purchase debtors - (0.5) 0.5
Less share of joint venture results
in underlying profit - (0.2) 0.2
Increase in working capital (1.1) 0.5 (1.6)
Professional fees paid for the
Takeover bid and defence (0.4) - (0.4)
Tax paid (0.3) (0.3) -
Restructuring costs paid - (0.3) 0.3
------------------------------------- ------ ------ -------
Net cash inflow from operating
activities 2.5 4.3 (1.8)
Financing and Investing Activities
Sale of FOGL shares - 1.4 (1.4)
Less:
Capital expenditure (1.8) (1.9) 0.1
Net bank interest paid (0.1) (0.1) -
Proceeds on sale of fixed assets 0.1 0.1 -
Net cash in from Treasury share
movements - 0.1 (0.1)
Cash inflows from joint venture 0.2 0.4 (0.2)
Bank and other loan repayments (0.8) (0.8) -
Bank and Hire purchase loan draw
down 1.0 3.1 (2.1)
Net cash outflow from financing
and investing activities (1.4) 2.3 (3.7)
------------------------------------- ------ ------ -------
Net cash inflow 1.1 6.6 (5.5)
Cash balance b/fwd. 14.0 7.4 6.6
Cash balance c/fwd. 15.1 14.0 1.1
------------------------------------- ------ ------ -------
Chief Executive's Strategic Review (continued)
Financing outflows
During the year the Group incurred GBP1.8 million of capital
expenditure (2016: GBP1.9 million); which included GBP0.8 million
of expenditure on the Unit 14 expansion at Leyton and an additional
GBP0.2 million spent at Momart on the vehicle fleet. In the
Falklands GBP0.3 million was spent on expanding the vehicle hire
fleet, which at 31 March 2017 includes 50 vehicles, (2016: 42) with
43 vehicles leased out at the year end. GBP0.1 million has been
spent on constructing a dedicated warehouse for third party
freight, and a further GBP0.2 million was incurred on normal
replacement expenditure. At PHFC, GBP0.2 million of expenditure has
been incurred on restoring the Victorian Portsea pontoon, including
remediating and replacing the cast iron girders underpinning the
pontoon.
In addition to the three bank loans held by PHFC, a further loan
of GBP1.0 million was drawn down by Momart in December 2016, to
finance the storage expansion. Scheduled loan repayments of GBP0.8
million (2016: GBP0.8 million) were made during the year, including
GBP0.3 million of repayments to Gosport Council on the 50 year
pontoon finance lease, GBP0.1 million of repayments on hire
purchase leases for trucks at Momart and GBP0.4 million of
repayments on the four bank loans.
John Foster
Chief Executive
13 June 2017
Board of Directors and Company Secretary
Jeremy Brade, Interim Chairman and Non-executive Director
Jeremy joined the Board in 2009. He is a Director of Harwood
Capital Management where he is the senior private equity partner.
Jeremy has served on the boards of several private and publicly
listed international companies. Formerly Jeremy was a diplomat in
the Foreign and Commonwealth Office, and before that an Army
officer. He is Chairman of the Remuneration Committee and has been
Interim Chairman of FIH group plc since 2 May 2017.
John Foster, Chief Executive
John joined the Board in 2005. He is a chartered accountant and
previously served as Finance Director on a number of fully listed
UK companies. Prior to this, John spent three years in charge of
acquisitions and disposals at FTSE 250 company, Ascot plc, and
before that worked for nine years as a venture capitalist with a
leading investment bank in the City.
Edmund Rowland, Non-executive Director
Edmund was appointed to the Board on 16 April 2013, and became
Chairman on 9 February 2015. He resigned as Chairman of FIH group
plc on 2 May 2017, but will remain on the board until a new
non-executive director is appointed.
Carol Bishop, Company Secretary
Carol Bishop joined the Company in December 2011. She is a
chartered accountant and has previously worked for London Mining
plc, an AIM listed company as Group Reporting manager. Prior to
this she spent three years at Hanson plc and six years at the
Peninsular and Oriental Steam Navigation Company.
Directors' Report
The Directors present their annual report and the financial
statements for the Company and for the Group for the year ended 31
March 2017.
Results and dividend
The Group's result for the year is set out in the Group Income
Statement. The Group profit for the year after taxation amounted to
GBP1,427,000 (2016: GBP2,222,000). Basic earnings per share on
underlying profits were 15.4 pence (2016: 19.2 pence).
The Directors recommend a dividend of 4.0 pence per share,
which, if approved by shareholders at the forthcoming Annual
General Meeting, will be paid on 22 September 2017 to shareholders
on the register at close of business on 1 September 2017. The
proposed final dividend has not been included in creditors as it
was not approved before the year end.
Principal activities
The business of the Group during the year ended 31 March 2017
was general trading in the Falkland Islands, the operation of a
passenger ferry across Portsmouth Harbour and the provision of
international arts logistics and storage services. The principal
activities of the Group are discussed in more detail in the Chief
Executive's Strategic Report and should be considered as part of
the Directors' Report for the purposes of the requirements of the
enhanced Directors' Report guidance.
The principal activity of the Company is that of a holding
company.
Directors
There have been no changes to the membership of the Board during
the year. On 2 May 2017 Edmund Rowland stood down as Chairman of
the Group and agreed to stay on the Board until a further board
appointment has been made. On 2 May 2017 Non-Executive Director
Jeremy Brade agreed to become interim Non-Executive Chairman
pending the appointment of a new independent Non-Executive
Chairman.
Directors' interests
The interests of the Directors in the issued shares and share
options over the shares of the Company are set out below under the
heading 'Directors' interests in shares'. During the year no
Director had an interest in any significant contract relating to
the business of the Company or its subsidiaries other than his own
service contract.
Health and safety
The Group is committed to the health, safety and welfare of its
employees and third parties who may be affected by the Group's
operations. The focus of the Group's effort is to prevent accidents
and incidents occurring by identifying risks and employing
appropriate control strategies. This is supplemented by a policy of
investigating and recording all incidents.
Employees
The Board is aware of the importance of good relationships and
communication with employees. Where appropriate, employees are
consulted about matters which affect the progress of the Group and
which are of interest and concern to them as employees. Within this
framework, emphasis is placed on developing greater awareness of
the financial and economic factors which affect the performance of
the Group. Employment policy and practices in the Group are based
on non-discrimination and equal opportunity irrespective of age,
race, religion, sex, colour and marital status. In particular, the
Group recognises its responsibilities towards disabled persons and
does not discriminate against them in terms of job offers, training
or career development and prospects. If an existing employee were
to become disabled during the course of employment, every practical
effort would be made to retain the employee's services with
whatever retraining is appropriate. The Group's pension
arrangements for employees are summarised in note 23.
Payments to suppliers
The policy of the Company and each of its trading subsidiaries,
in relation to all its suppliers, is to settle the terms of payment
when agreeing the terms of the transaction and to abide by those
terms, provided that it is satisfied that the supplier has provided
the goods or services in accordance with agreed terms and
conditions. The Group does not follow any code or standard payment
practice. As a holding company, the Company had no trade creditors
at either 31 March 2017 or 31 March 2016.
Directors' Report (continued)
Corporate Governance
As an AIM company, FIH group plc is not required to comply with
the UK Corporate Governance Code (the 'Code') which applies only to
fully listed UK companies and adherence to which requires the
commitment of significant resources and cost. However high
standards of Corporate Governance are a key priority of the Board
and details of how the Company addresses key governance issues are
set out in the Corporate Governance section of its website by
reference to the 12 principles of Corporate Governance developed by
the Quoted Companies Alliance.
The Board has established Audit, Remuneration, Nominations, and
AIM Rules Compliance Committees and the Company receives regular
feedback from its external auditors on the state of its internal
controls. The Board attaches great importance to providing
shareholders with clear and transparent information on the Group's
activities, strategy and financial position. Details of all
shareholder communications are provided on the Group's website. The
Board holds regular meetings with larger shareholders and regards
the annual general meeting as a good opportunity to communicate
directly with shareholders via an open question and answer
session.
Share capital and substantial interests in shares
During the year 2,795 shares were issued following the exercise
of options by employees. Further information about the Company's
share capital is given in note 25. Details of the Company's
executive share option scheme and employee ownership plan can be
found in note 24.
The Company was been notified of the following interests in 3%
or more of the issued ordinary shares of the Company as at 31 May
2017:
Number of Percentage of
shares shares in issue
---------------------------------- ---------- -----------------
The Article 6 Marital Trust
created under the First Amended
and Restated Jerry Zucker
Revocable Trust dated 2 April
2007 3,596,553 28.92
---------------------------------- ---------- -----------------
Argos Argonaut Fund 1,228,736 9.88
---------------------------------- ---------- -----------------
J.F.C Watts 797,214 6.41
---------------------------------- ---------- -----------------
Martin Janser 756,818 6.09
---------------------------------- ---------- -----------------
Bonafide Global Fish Fund 671,000 5.40
---------------------------------- ---------- -----------------
Christian Struck 377,000 3.03
---------------------------------- ---------- -----------------
Charitable and political donations
Charitable donations made by the Group during the year amounted
to GBP14,771 (2016: GBP19,229), largely to local community
charities in Gosport and the Falkland Islands. There were no
political donations in the year (2016: nil).
Disclosure of information to auditor
The Directors who held office at the date of this Directors'
Report confirm that, so far as they are each aware, there is no
relevant audit information of which the Company's auditor is
unaware; and each Director has taken all the steps that they ought
to have taken as a Director to make themselves aware of any
relevant audit information and to establish that the Company's
auditor is aware of that information.
Auditor
A resolution proposing the re-appointment of KPMG LLP will be
put to shareholders at the Annual General Meeting.
Directors' Report (continued)
Annual General Meeting
The Company's Annual General Meeting will be held at the London
offices of FTI Consulting, 200 Aldersgate, London, EC1A 4HD at
11.30 a.m. on 31 August 2017. The Notice of the Annual General
Meeting and a description of the special business to be put to the
meeting are considered in a separate Circular to Shareholders.
Details of Directors' remuneration and emoluments
The remuneration of non-executive Directors consists only of
annual fees for their services both as members of the Board and of
Committees on which they serve.
An analysis of the remuneration and taxable benefits in kind
(excluding share options) provided for and received by each
Director during the year to 31 March 2017 and in the preceding year
is as follows:
Salary Bonus 2017 2016
GBP'000 GBP'000 Total Total
GBP'000 GBP'000
----------------- --------- --------- --------- ---------
John Foster 206 *- 206 238
----------------- --------- --------- --------- ---------
Jeremy Brade 30 - 30 30
----------------- --------- --------- --------- ---------
Edmund Rowland 65 - 65 65
----------------- --------- --------- --------- ---------
Mike Killingley - - - **1
----------------- --------- --------- --------- ---------
Total 301 - 301 334
----------------- --------- --------- --------- ---------
*The Chief Executive's bonus for the year is normally split into
equal parts of deferred shares and cash, with the shares requiring
a service condition to remain in employment for up to three years.
For the year ended 31 March 2017, John Foster has waived his cash
bonus and taken a reduced deferred shares award of GBP27,500, to be
issued on 16 June 2017. These deferred shares will be provided at
no cost to him in three equal tranches over the next three
years.
**Until date of resignation
None of the Directors of the Company receive any pension
contributions or benefit from any Group pension scheme.
The Executive Directors participate in annual performance
related bonus arrangements. The Chief Executive had the potential
during the year of earning up to 100% of his salary. The bonuses
are subject to the achievements of specified corporate and personal
objectives.
Directors' interests in shares
As at 31 March 2017, the share options of executive Directors
may be summarised as follows:
Date of grant Number Exercise Exercisable Expiry
of options price from date
J L Foster
--------------- ------------ --------- ------------ -----------
07 Aug 2007 27,517 GBP3.30 7 Aug 2010 6 Aug 2017
--------------- ------------ --------- ------------ -----------
15 Jul 2009 44,550 GBP2.90 15 Jul 14 Jul
2012 2019
--------------- ------------ --------- ------------ -----------
10 Jun 2015 GBP0.00 10 Jun 10 Jun
7,547 2017 2019
--------------- ------------ --------- ------------ -----------
10 Jun 2015 GBP0.00 10 Jun 10 Jun
7,547 2018 2019
--------------- ------------ --------- ------------ -----------
17 Jun 2016 6,272 GBP0.00 17 June 17 Jun
2017 2020
--------------- ------------ --------- ------------ -----------
17 Jun 2016 6,272 GBP0.00 17 June 17 Jun
2018 2020
--------------- ------------ --------- ------------ -----------
17 Jun 2016 6,273 GBP0.00 17 June 17 Jun
2019 2020
--------------- ------------ --------- ------------ -----------
Total 105,978
--------------- ------------ --------- ------------ -----------
The mid-market price of the Company's shares on 31 March 2017
was 302.50 pence and the range in the year was 179.00 pence to
332.50 pence.
Directors' Report (continued)
The Directors' options extant at 31 March 2017 totalled 105,978
and represented 0.85% of the Company's issued share capital. The
203,994 remaining options are held by 36 other employees of the
Group including subsidiary directors and senior management. Under
the Company's executive share option scheme, executive Directors
and senior executives have been granted options to acquire ordinary
shares in the Company after a period of three years from the date
of the grant. All outstanding options have been granted at an
option price of not less than market value at the date of the
grant. The exercise of options is subject to various performance
conditions, which have been determined by the remuneration
committee after discussion with the Company's advisors.
In addition to the share options set out above, the interests of
the Directors, their immediate families and related trusts in the
shares of the Company according to the register kept pursuant to
the Companies Act 2006 were as shown below:
Ordinary shares Ordinary shares
as at as at
31 March 2017 31 March 2016
---------------- ---------------- ----------------
John Foster* *78,127 *72,830
---------------- ---------------- ----------------
Jeremy Brade 15,010 15,010
---------------- ---------------- ----------------
Edmund Rowland **3,106,553 **2,815,180
---------------- ---------------- ----------------
*John Foster's shareholding above includes all Shares held in
the Company's share incentive plan in which he has a beneficial
interest.
** Blackfish Capital Alpha Fund SPC and Staunton Holdings
Limited are companies connected with Edmund Rowland, a
non-executive director of the Company, and through this
relationship with both Staunton Holdings Limited and Blackfish
Capital Management, at 31 March 2017, Edmund Rowland was interested
in 3,106,553 shares in the Company, representing approximately
24.98 per cent of the issued share capital of the Company. These
shareholdings were sold on 2 May 2017 to The Article 6 Marital
Trust, therefore Edmund Rowland no longer has any beneficial
interest in the shares of FIH group plc.
Share Incentive Plan
In November 2012, the Company implemented an HMRC approved Share
Incentive Plan (SIP) available to employees of the Group, which
enables UK and Falklands staff to acquire shares in the Company
through monthly purchases of up to GBP150 per month or 10% of
salary, whichever is lower. For every three shares purchased by the
employee, the Company contributes one free matching share. These
shares are placed in trust and if they are left in trust for at
least five years, they can be removed free of UK income tax and
national insurance contributions. During the year ended 31 March
2017 the Company purchased GBP600 of matching shares for Mr J
Foster.
Statement of Directors' responsibilities in respect of the
Annual Report, Directors' Report, Strategic Report and the
Financial Statements
The Directors are responsible for preparing the Annual Report,
Strategic Report, Directors' Report, and the financial statements
in accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and Parent
Company financial statements for each financial year. Under that
law they have elected to prepare both the group and the parent
company financial statements in accordance with IFRSs as adopted by
the EU and applicable law. As required by the AIM Rules of the
London Stock Exchange, they are required to prepare the Group
financial statements in accordance with IFRSs as adopted by the EU
and applicable law and have elected to prepare the Parent Company
financial statements on the same basis.
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 Group and Parent Company and of
their profit or loss for that period. In preparing each of the
Group and Parent Company financial statements, the Directors are
required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and estimates that are reasonable and prudent;
-- state whether they have been prepared in accordance with IFRSs as adopted by the EU; and
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Group and the Parent
Company will continue in business.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Parent
Company's transactions and disclose with reasonable accuracy at any
time the financial position of the Parent Company and enable them
to ensure that its financial statements comply with the Companies
Act 2006. They 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.
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.
The Directors confirm, to the best of their knowledge that:
-- these financial statements, prepared in accordance with IFRS,
as adopted by the European Union, give a true and fair view of the
assets, liabilities, financial position and profit of the Company
and the undertakings included in the consolidation as a whole;
and
-- the management report, which comprises the Chairman's
Statement and the Chief Executive's Strategic Report, includes a
fair review of the development and performance of the business and
of the position of the Company and the undertakings included in the
consolidation taken as a whole, together with a description of the
principal risks and uncertainties that they face.
Approved by the Board and signed on its behalf by:
Carol Bishop
Company Secretary
13 June 2017
Kenburgh Court
133-137 South Street
Bishop's Stortford
Hertfordshire
CM23 3HX
Independent Auditor's Report to the Members of FIH group plc
We have audited the financial statements of FIH group plc for
the year ended 31 March 2017 set out on pages 26 to 71. The
financial reporting framework that has been applied in their
preparation is applicable law and International Financial Reporting
Standards (IFRSs) as adopted by the EU and, as regards the parent
company financial statements, as applied in accordance with the
provisions of the Companies Act 2006.
This report is made solely to the company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
company's members those matters we are required to state to them in
an auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the company and the company's members, as a body,
for our audit work, for this report, or for the opinions we have
formed.
Respective responsibilities of directors and auditor
As explained more fully in the Directors' Responsibilities
Statement, the directors are responsible for the preparation of the
financial statements and for being satisfied that they give a true
and fair view. Our responsibility is to audit, and express an
opinion on, the financial statements in accordance with applicable
law and International Standards on Auditing (UK and Ireland). Those
standards require us to comply with the Auditing Practices Board's
Ethical Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements
is provided on the Financial Reporting Council's website at
www.frc.org.uk/auditscopeukprivate.
Opinion on financial statements
In our opinion:
-- the financial statements give a true and fair view of the
state of the group's and of the parent company's affairs as at 31
March 2017 and of the group's profit for the year then ended;
-- the group financial statements have been properly prepared in
accordance with IFRSs as adopted by the EU;
-- the parent company financial statements have been properly
prepared in accordance with IFRSs as adopted by the EU and as
applied in accordance with the provisions of the Companies Act
2006; and
-- the financial statements have been prepared in accordance
with the requirements of the Companies Act 2006.
Opinion on other matters prescribed by the Companies Act
2006
In our opinion the information given in the Strategic Report and
the Directors' Report for the financial year is consistent with the
financial statements.
Based solely on the work required to be undertaken in the course
of the audit of the financial statements and from reading the
Strategic report and the Directors' report:
-- we have not identified material misstatements in those reports; and
-- in our opinion, those reports have been prepared in accordance with the Companies Act 2006.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters
where the Companies Act 2006 requires us to report to you if, in
our opinion:
-- adequate accounting records have not been kept by the parent
company, or returns adequate for our audit have not been received
from branches not visited by us; or
-- the parent company financial statements are not in agreement
with the accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made; or
-- we have not received all the information and explanations we require for our audit.
Craig Parkin
Senior Statutory Auditor
For and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
St Nicholas House
Park Row
Nottingham
NG1 6FQ
13 June 2017
Consolidated Income Statement
FOR THE YEARED 31 MARCH 2017
Notes Before Before
amortisation Amortisation amortisation Amortisation
& non-trading & non-trading & non-trading & non-trading
items items Total items items Total
2017 2017 2017 2016 2016 2016
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------- --------------- --------------- --------- --------------- --------------- ---------
4 Revenue 40,494 - 40,494 38,996 - 38,996
Cost of sales (24,861) - (24,861) (23,497) - (23,497)
----------------- --------------- --------------- --------- --------------- --------------- ---------
Gross profit 15,633 - 15,633 15,499 - 15,499
Other
administrative
expenses (13,064) - (13,064) (12,398) - (12,398)
Takeover bid
costs - (530) (530) - - -
Restructuring
costs - - - - (261) (261)
Gain on sale of
FOGL shares - - - - 388 388
Consumer Finance
interest income 236 - 236 206 - 206
Gain on sale of
vessel - 76 76 - 60 60
Amortisation of
intangible
11 assets - (136) (136) - (136) (136)
Operating
expenses (12,828) (590) (13,418) (12,192) 51 (12,141)
Operating profit 2,805 (590) 2,215 3,307 51 3,358
Share of results
of Joint Venture 24 81 105 200 (330) (130)
----------------- --------------- --------------- --------- --------------- --------------- ---------
Profit before
net financing
costs 2,829 (509) 2,320 3,507 (279) 3,228
Finance income 21 - 21 27 - 27
Finance expense (454) - (454) (456) - (456)
----------------- --------------- --------------- --------- --------------- --------------- ---------
Net financing
8 costs (433) - (433) (429) - (429)
Profit / (loss)
before tax from
continuing
operations 2,396 (509) 1,887 3,078 (279) 2,799
9 Taxation (490) 30 (460) (699) 122 (577)
Profit / (loss)
for the year
attributable to
equity holders
of the company 1,906 (479) 1,427 2,379 (157) 2,222
----------------- --------------- --------------- --------- --------------- --------------- ---------
Earnings per
10 share
Basic 15.4p 11.5p 19.2p 18.0p
Diluted 15.3p 11.5p 19.2p 17.9p
--------- ---------
Consolidated Statement of Comprehensive Income
FOR THE YEARED 31 MARCH 2017
2017 2016
GBP'000 GBP'000
------------------------------------------- -------- --------
Cash flow hedges - effective portion
of changes in fair value 15 (82)
Reclassification to profit or loss
on sale of shares in Falkland Oil and
Gas - (492)
------------------------------------------- -------- --------
Items that are or may be reclassified
subsequently to profit or loss 15 (574)
(Increase) / (decrease in the FIC defined
benefit pension liability (366) 215
Movement on deferred tax asset relating
to pension schemes 95 (56)
Items which will not ultimately be
recycled to the income statement (271) 159
Other comprehensive expense (256) (415)
Profit for the year 1,427 2,222
------------------------------------------- -------- --------
Total comprehensive income 1,171 1,807
------------------------------------------- -------- --------
Consolidated Balance Sheet
AT 31 MARCH 2017
2017 2016
Notes GBP'000 GBP'000
-------------------------------------- --------- ---------
Non-current assets
11 Intangible assets 11,846 12,037
12 Property, plant and equipment 20,147 19,930
13 Investment properties 3,723 3,632
15 Investment in Joint venture 241 136
16 Finance leases receivable 763 755
17 Deferred tax assets 776 687
Total non-current assets 37,496 37,177
Current assets
18 Inventories 5,356 6,241
19 Trade and other receivables 7,498 4,853
16 Finance leases receivable 799 810
20 Cash and cash equivalents 15,079 14,037
Total current assets 28,732 25,941
TOTAL ASSETS 66,228 63,118
Current liabilities
21 Interest-bearing loans and borrowings (615) (546)
Income tax payable (182) (191)
22 Trade and other payables (12,286) (11,244)
Total current liabilities (13,083) (11,981)
Non-current liabilities
21 Interest-bearing loans and borrowings (8,224) (7,855)
23 Employee benefits (2,985) (2,644)
17 Deferred tax liabilities (2,191) (2,069)
Total non-current liabilities (13,400) (12,568)
TOTAL LIABILITIES (26,483) (24,549)
Net assets 39,745 38,569
-------------------------------------- --------- ---------
25 Capital and reserves
Equity share capital 1,243 1,243
Share premium account 17,447 17,447
Other reserves 1,162 1,162
Retained earnings 19,960 18,799
Hedging reserve (67) (82)
Total equity 39,745 38,569
-------------------------------------- --------- ---------
These financial statements were approved by the Board of
Directors on 13 June 2017 and were signed on its behalf by:
J L Foster
Director
Company Balance Sheet
AT 31 MARCH 2017
2017 2016
Notes GBP'000 GBP'000
---------------------------- -------- --------
Non-current assets
14 Investment in subsidiaries 27,629 28,164
19 Loans to subsidiaries 6,965 3,465
17 Deferred tax 17 9
------ ---------------------------- -------- --------
Total non-current assets 34,611 31,638
Current assets
19 Trade and other receivables 12 15
Corporation tax receivable 94 46
20 Cash and cash equivalents 8,780 11,761
Total current assets 8,886 11,822
TOTAL ASSETS 43,497 43,460
Current liabilities
22 Trade and other payables (3,387) (3,188)
Net assets 40,110 40,272
---------------------------- -------- --------
25 Capital and reserves
Equity share capital 1,243 1,243
Share premium account 17,447 17,447
Other reserves 6,910 6,910
Retained earnings 14,577 14,754
Hedging reserve (67) (82)
Total equity 40,110 40,272
---------------------------- -------- --------
As permitted by Section 408 of the Companies Act 2006, a
separate profit and loss account of the Parent Company has not been
presented. The Parent Company's loss for the financial year is
GBP182,000 (2016: GBP1,356,000 profit).
These financial statements were approved by the Board of
Directors on 13 June 2017 and were signed on its behalf by:
J L Foster
Director
Registered company number: 03416346
Consolidated Cash Flow Statement
FOR THE YEARED 31 MARCH 2017
2017 2016
GBP'000 GBP'000
--------------------------------------------- -------- ----------
Cash flows from operating activities
Profit for the year after taxation 1,427 2,222
Adjusted for:
(i) Non-cash items:
Depreciation and Amortisation 1,587 1,595
Professional fees incurred for Takeover
bid and defence 530 -
Gain on disposal of fixed assets (76) (49)
Share of Joint Venture (profit) /loss,
after impairment provision (105) 130
Interest cost on pension scheme liabilities 88 90
Equity-settled share-based payment
expenses 15 61
--------------------------------------------- -------- ----------
Non-cash items adjustment 2,039 1,827
(ii) Other items:
Bank interest receivable (21) (27)
Bank interest payable 127 117
Finance lease interest payable 239 240
Decrease / (Increase) in finance leases
receivable 3 (460)
Gain on disposal of FOGL shares - (388)
Corporation and deferred tax expense 460 577
--------------------------------------------- -------- ----------
Other adjustments 808 59
Operating cash flow before changes
in working capital and provisions 4,274 4,108
(Increase) / decrease in trade and
other receivables (2,645) 455
Decrease / (increase) in inventories 971 (742)
Increase in trade and other payables 686 909
Decrease in provisions and employee
benefits (113) (115)
--------------------------------------------- -------- ----------
Changes in working capital and provisions (1,101) 507
Cash generated from operations 3,173 4,615
Cash outflow on option exercise (10) -
Professional fees paid for Takeover
bid and defence (365) -
Corporation taxes paid (336) (324)
--------------------------------------------- -------- ----------
Net cash flow from operating activities 2,462 4,291
Cash flows from investing activities
Purchase of property, plant and equipment (1,790) (1,854)
Proceeds from the disposal of property,
plant & equipment 76 141
Proceeds received from the sale of
FOGL shares - 1,396
Loans received from joint venture 200 378
Interest received 21 27
--------------------------------------------- -------- ----------
Net cash flow from investing activities (1,493) 88
Cash flow from financing activities
Repayment of secured loan (829) (760)
Bank loan drawn down 990 2,890
Bank and HP interest paid (126) (117)
Hire purchase loan drawn down 38 158
Cash outflow on purchase of Treasury
shares - (681)
Proceeds from sale of Treasury shares - 733
--------------------------------------------- -------- --------
Net cash flow from financing activities 73 2,223
Net increase in cash and cash equivalents 1,042 6,602
Cash and cash equivalents at start
of year 14,037 7,435
Cash and cash equivalents at end of
year 15,079 14,037
--------------------------------------------- -------- --------
Company Cash Flow Statement
FOR THE YEARED 31 MARCH 2017
2017 2016
GBP'000 GBP'000
------------------------------------------ -------- --------
Notes Cash flows from operating activities
Holding Company (Loss) / profit for
the year (182) 1,356
Adjusted for:
Bank interest receivable (19) (25)
Professional fees incurred on the
failed Takeover 530 -
Ineffective portion of cash flow hedge (1) 5
Equity-settled share-based payment
expenses 39 44
14 Impairment of investment 511 102
Corporation and deferred tax expense 37 41
------------------------------------------ -------- --------
Operating cash flow before changes
in working capital and provisions 915 1,523
Decrease / (increase) in trade and
other receivables 3 (3)
Increase / (decrease) in trade and
other payables 47 (4)
------------------------------------------ -------- --------
Changes in working capital and provisions 50 (7)
Cash generated from operations 965 1,516
Cash outflow on option exercise (7) -
Professional fees paid for Takeover
bid and defence (365) -
Corporation taxes paid (93) (59)
------------------------------------------ -------- --------
Net cash flow from operating activities 500 1,457
Cash flow from financing activities
Cash flows in inter-company borrowing (3,500) 848
Interest received 19 25
Cash outflow on purchase of Treasury
shares - (681)
Proceeds from sale of Treasury shares - 733
------ ------------------------------------------ -------- --------
Net cash flow from financing activities (3,481) 925
Net (decrease) / increase in cash
and cash equivalents (2,981) 2,382
Cash and cash equivalents at start
of year 11,761 9,379
Cash and cash equivalents at end of
year 8,780 11,761
------------------------------------------ -------- --------
Consolidated Statement of Changes in Shareholders' Equity
FOR THE YEARED 31 MARCH 2017
Financial
assets
Equity Share fair
share premium Other Retained value Hedge Total
capital account reserves earnings reserve reserve equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 April
2015 1,243 17,447 1,162 16,344 492 - 36,688
Profit for the
year - - - 2,222 - - 2,222
Share based payments - - - 61 - - 61
Cash flow hedges
- effective portion
of changes in
fair value - - - - - (82) (82)
Transfer to the
income statement
on sale of shares
in FOGL - - - - (492) - (492)
Re-measurement
of the defined
benefit pension
liability, net
of tax - - - 159 - - 159
Purchase of Treasury
shares - - - (720) - - (720)
Sale of Treasury
shares - - - 733 - - 733
Balance at 31
March 2016 1,243 17,447 1,162 18,799 - (82) 38,569
Profit for the
year - - - 1,427 - - 1,427
Share based payments - - - 15 - - 15
Cash flow hedges
- effective portion
of changes in
fair value - - - - - 15 15
Share option exercise - - - (10) - - (10)
Re-measurement
of the defined
benefit pension
liability, net
of tax - - - (271) - - (271)
Balance at 31
March 2017 1,243 17,447 1,162 19,960 - (67) 39,745
------------------------ --------- --------- ---------- ---------- ---------- --------- ---------
Company Statement of Changes in Shareholders'
Equity
FOR THE YEARED 31
MARCH 2017
Equity Share
share premium Other Retained Hedge Total
capital account reserves earnings Reserve equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 April
2015 1,243 17,447 6,910 13,324 - 38,924
Profit for the year - - - 1,356 - 1,356
Share-based payments - - - 61 - 61
Cash flow hedges
- effective portion
of changes in fair
value - - - - (82) (82)
Purchase of Treasury
shares - - - (720) - (720)
Sale of Treasury
shares - - - 733 - 733
Balance at 31 March
2016 1,243 17,447 6,910 14,754 (82) 40,272
Loss for the year - - - (182) - (182)
Share based payments - - - 15 - 15
Option exercise - - - (10) - (10)
Cash flow hedges
- effective portion
of changes in fair
value - - - - 15 15
Balance at 31 March
2017 1,243 17,447 6,910 14,577 (67) 40,110
------------------------ --------- --------- ---------- ---------- ---------- --------------------
A loss of GBP182,000 (2016: GBP1,356,000 profit) has been dealt
with in the accounts of the Parent Company. As permitted by Section
408 of the Companies Act 2006, the Company has not presented its
own profit and loss account.
Notes to the Financial Statements
1. Accounting policies
General information
FIH group plc (the "Company") is a company incorporated and
domiciled in the UK.
Reporting entity
The group financial statements consolidate those of the Company
and its subsidiaries (together referred to as the "Group"). The
Parent Company financial statements present information about the
Company as a separate entity and not about its group.
Basis of preparation
Both the Parent Company financial statements and the Group
financial statements have been prepared and approved by the
Directors in accordance with International Financial Reporting
Standards as adopted by the EU ("Adopted IFRS"). On publishing the
Parent Company financial statements here together with the Group
financial statements, the Company is taking advantage of the
exemption in s408 of the Companies Act 2006 not to present its
individual income statement and related notes that form a part of
these approved financial statements.
The accounting policies set out below have, unless otherwise
stated, been applied consistently to all periods presented in these
consolidated financial statements.
Judgements made by the Directors in the application of these
accounting policies that have a significant effect on the financial
statements and estimates with a significant risk of material
adjustment next year are discussed in note 30.
The financial statements are presented in pounds sterling,
rounded to the nearest thousand and are prepared on the historical
cost basis.
The Directors are responsible for ensuring that the Group has
adequate financial resources to meet its projected liquidity
requirements and also for ensuring forecast earnings are sufficient
to meet the covenants associated with the Group's banking
facilities.
As in prior years the Directors have reviewed the Group's medium
term forecasts and considered a number of possible trading
scenarios and are satisfied the Group's existing resources
(including committed banking facilities) are sufficient to meet its
needs. As a consequence the Directors believe the Group is well
placed to manage its business risk.
The Group's business activities, together with the factors
likely to affect its future development, performance and position
are set out in the Chief Executive's Strategic Report. The
financial position of the Group, its cash flows, liquidity position
and borrowing facilities are also described in the Chief
Executive's Strategic Report. In addition, note 26 to the financial
statements includes the Group's objectives, policies and processes
for managing its capital; its financial risk management objectives;
details of its financial instruments and hedging activities; and
its exposures to credit risk and liquidity risk.
The Group has considerable financial resources. As a
consequence, the Directors believe that the Group is well placed to
manage its business risks successfully. After making enquiries the
Directors have a reasonable expectation that the Company and Group
have adequate facilities to continue in operational existence for
the foreseeable future, and have continued to adopt the going
concern basis in preparing the financial statements.
Basis of consolidation
The consolidated financial statements comprise the financial
statements of FIH group plc and its subsidiaries (the "Group"). A
subsidiary is any entity FIH group plc has the power to control.
Control is determined by FIH group plc's exposure or rights, to
variable returns from its involvement with the subsidiary and the
ability to affect those returns. The financial statements of
subsidiaries are prepared for the same reporting period as the
Parent Company. The accounting policies of subsidiaries have been
changed when necessary to align them with the policies adopted by
the Group.
Subsidiaries are consolidated from the date on which control is
transferred to the Group and cease to be consolidated from the date
on which control is transferred out of the Group.
1. Accounting policies (continued)
All intra-company balances and transactions, including
unrealised profits arising from intra-group transactions, are
eliminated in full in preparing the consolidated financial
statements. Investments in subsidiaries within the Company balance
sheet are stated at impaired cost.
Presentation of income statement
Due to the non-prescriptive nature under IFRS as to the format
of the income statement, the format used by the Group is explained
below.
Operating profit is the pre-finance profit of continuing
activities and acquisitions of the Group, and in order to achieve
consistency and comparability, is analysed to show separately the
results of normal trading performance ("underlying profit"),
individually significant charges and credits, changes in the fair
value of financial instruments and amortisation of intangible
assets on acquisition ("amortisation and non-trading items"). Such
items arise because of their size or nature.
In 2017 these non- trading items comprise:
-- Professional costs incurred in dealing with the failed bid by
Staunton Holdings and the defence against a possible bid by the,
Argentine controlled, Dolphin Fund - GBP530,000
-- Profit on the sale of certain plant and machinery owned by
SAtCO, following an impairment in the previous year - GBP81,000
-- Gain on vessel disposal in PHFC - GBP76,000
-- Amortisation of intangible assets - GBP136,000
In 2016 these items comprised:
-- The impairment provision made against certain plant and
machinery owned by SAtCO - GBP330,000
-- Restructuring costs - GBP261,000
-- Gain on the sale of the Portsmouth Queen ferry - GBP60,000
-- Gain on the sale of Falkland Oil and Gas Limited shares - GBP388,000; and
-- the amortisation of intangible assets - GBP136,000
Foreign currencies
Transactions in foreign currencies are translated to the
functional currencies of Group entities at exchange rates ruling at
the dates of the transactions. Monetary assets and liabilities
denominated in foreign currencies are retranslated to the
functional currency using the relevant rates of exchange ruling at
the balance sheet date and the gains or losses thereon are included
in the income statement.
Non-monetary assets and liabilities are translated using the
exchange rate at the date of the initial transaction.
Property, plant and equipment
Property, plant and equipment are measured at cost less
accumulated depreciation and impairment losses. Cost comprises
purchase price and directly attributable expenses. Depreciation is
charged to the income statement on a straight-line basis over the
estimated useful lives of each part of an item of property, plant
and equipment. The estimated useful lives are as follows:
20 - 50
Freehold buildings years
Long leasehold land and buildings 50 years
Vehicles, plant and equipment 4 - 10 years
15 - 30
Ships years
The carrying value of assets and their useful lives are
reviewed, and adjusted if appropriate, at each balance sheet date.
If an indication of impairment exists, the assets are written down
to their recoverable amount and the impairment is charged to the
income statement in the period in which it arises. Freehold land
and assets under construction are not depreciated.
1. Accounting policies (continued)
Investment properties
Investment properties are properties held either to earn rental
income or for capital appreciation or for both. Investment
properties are stated at cost less any accumulated depreciation
(calculated on useful economic lives in line with accounting
policy, as stated under property, plant and equipment above) and
any impairment losses.
Joint Ventures
Jointly controlled entities are those entities over whose
activities the Group has joint control, established by contractual
agreement and requiring the joint venture partners' unanimous
consent for strategic financial and operating decisions. FIH group
plc has joint control over an investee when it has exposure or
rights to variable returns from its involvement with the joint
venture and has the ability to affect those returns through its
joint power over the entity.
Jointly controlled entities are accounted for using the equity
method (equity accounted investees) and are initially recognised at
cost. The consolidated financial statements include the Group's
share of the total comprehensive income and equity movements of
equity accounted investees, from the date that significant
influence or joint control commences until the date that
significant influence or joint control ceases. When the Group's
share of losses exceeds its interest in an equity accounted
investee, the Group's carrying amount is reduced to nil and
recognition of further losses is discontinued except to the extent
that the Group has incurred legal or constructive obligations or
made payments on behalf of an investee.
Intangible assets
Goodwill
Goodwill arises on the acquisition of subsidiaries and
businesses.
Acquisitions prior to 1 April 2006
In respect to acquisitions prior to transition to IFRS, goodwill
is recorded on the basis of deemed cost, which represents the
amount recorded under previous Generally Accepted Accounting
Principles ("GAAP") as at the date of transition. The
classification and accounting treatment of business combinations
which occurred prior to transition has not been reconsidered in
preparing the Group's opening IFRS balance sheet at 1 April 2006.
Goodwill is not amortised but reviewed for impairment annually, or
more frequently, if events or changes in circumstances indicate
that the carrying value may be impaired.
Acquisitions on or after 1 April 2006
Goodwill on acquisition is initially measured at cost, being the
excess of the cost of the business combination over the acquirer's
interest in the fair value of the identifiable assets, liabilities
and contingent liabilities of the acquired business. Following
initial recognition, goodwill is measured at cost less any
accumulated impairment losses. Goodwill is not amortised but
reviewed for impairment annually or more frequently if events or
changes in circumstances indicate that the carrying value may be
impaired.
Amortisation is charged to the income statement on a
straight-line basis over the estimated useful lives of intangible
assets unless such lives are indefinite. Other intangible assets
are amortised from the date they are available for use. The
estimated useful lives are as follows:
Trade name indefinite life
Customer relationships 6 - 10 years
In the year ended 31 March 2014, the Directors reviewed the life
of the brand name at Momart and after considerations of its strong
reputation in a niche market and its history of stable earnings and
cash flow, which is expected to continue into the foreseeable
future, determined that its useful life is indefinite, and
amortisation ceased from 1 October 2013.
1. Accounting policies (continued)
Computer software
Acquired computer software is capitalised as an intangible asset
on the basis of the cost incurred to acquire and bring the specific
software into use. Amortisation is charged to the income statement
on a straight-line basis over the estimated useful lives of
intangible assets from the date that they are available for use.
The estimated useful life of computer software is seven years.
Impairment of non-financial assets
At each reporting date the Group assesses whether there is any
indication that an asset may be impaired. Goodwill and intangible
assets with indefinite lives are tested for impairment, at least
annually. Where an indicator of impairment exists or the asset
requires annual impairment testing, the Group makes a formal
estimate of the recoverable amount. Where the carrying amount of an
asset exceeds its recoverable amount, the asset is considered
impaired and is written down to its recoverable amount. Impairment
losses are recognised in the income statement.
Recoverable amount is the greater of an asset's or
cash-generating unit's fair value less cost to sell or value in
use. It is determined for an individual asset, unless the asset's
value in use cannot be estimated and it does not generate cash
inflows that are largely independent of those from other assets or
groups of assets, in which case the recoverable amount is
determined for the cash-generating unit to which the asset belongs.
In assessing value in use, the estimated future cash flows are
discounted to their present value using a discount rate that
reflects current market assessments of the time value of money and
risks specific to the asset.
An impairment loss in respect of goodwill is not reversed. In
respect of other assets, impairment losses are reversed if there
has been a change in the estimates used to determine the
recoverable amount. An impairment loss is reversed only to the
extent that the asset's carrying amount does not exceed the
carrying amount that would have been determined, net of
depreciation or amortisation, if no impairment loss had been
recognised.
Finance income and expense
Net financing costs comprise interest payable and interest
receivable which are recognised in the income statement. Interest
income and interest payable are recognised as a profit or loss as
they accrue, using the effective interest method.
Financial instruments classified as available-for-sale
The investment in Falkland Oil and Gas Limited was stated at
fair value, with any resultant gain or loss recognised in other
comprehensive income and presented in the fair value reserve in
equity, except for impairment losses. When these items were
derecognised, the cumulative gain or loss previously recognised
directly in equity was recycled to the profit and loss. Financial
instruments classified as available-for-sale are initially
recognised at fair value less directly attributable transaction
costs.
Employee share awards
The Group provides benefits to certain employees (including
Directors) in the form of share-based payment transactions, whereby
the recipient renders service in return for shares or rights over
future shares ("equity settled transactions"). The cost of these
equity settled transactions with employees is measured by reference
to an estimate of their fair value at the date on which they were
granted using an option input pricing model taking into account the
terms and conditions upon which the options were granted. The
amount recognised as an expense is adjusted to reflect the actual
number of share options for which the related service and
non-market performance conditions are expected to be met, such that
the amount ultimately recognised as an expense is based on the
number of share options that meet the related service and
non-market performance conditions at the vesting date. For
share-based payment awards with market performance vesting
conditions, the grant date fair value of the share-based payments
is measured to reflect such conditions and there is no true up for
differences between expected and actual outcomes.
The cost of equity settled transactions is recognised, together
with a corresponding increase in reserves, over the period in which
the performance conditions are fulfilled, ending on the date that
the option vests. Where the Company grants options over its own
shares to the employees of subsidiaries, it recognises, in its
individual financial statements, an increase in the cost of
investment in its subsidiaries equal to the equity settled
share-based payment charge recognised in its consolidated financial
statements with the corresponding credit being recognised directly
in equity.
1. Accounting policies (continued)
Inventories
Inventories are stated at the lower of cost and net realisable
value. Cost includes all costs incurred in bringing each product to
its present location and condition, as follows:
The cost of raw materials, consumables and goods for resale
comprises purchase cost, on a weighted average basis and where
applicable includes expenditure incurred in transportation to the
Falkland Islands.
Work-in-progress and finished goods cost includes direct
materials and labour plus attributable overheads based on a normal
level of activity.
Construction-in-progress is stated at the lower of cost and net
realisable value.
Net realisable value is estimated at selling price in the
ordinary course of business less costs of disposal.
Revenue
Revenue is measured at the fair value of the consideration
received or receivable and represents the amount receivable by the
Group for goods supplied and services rendered in the normal course
of business, net of discounts and excluding VAT. Revenue
principally arises from retail sales, the provision of ferry
services and the provision of storage and transportation services
for fine art works. In the Falkland Islands, revenue also includes
proceeds from property sales, property rental income, insurance
commissions, revenues billed for shipping and agency activities and
port services. Revenue from sale of goods is recognised at the
point of sale or dispatch, which approximates to the point when
significant risks and rewards are transferred to the buyer, whilst
that of the ferry, fine art logistics and other services is
recognised when the service is provided. Revenue from property
sales is recognised on completion.
For fine art exhibition logistical work undertaken, where the
costs incurred and the costs to complete the transaction can be
measured reliably, the amount of profit attributable to the stage
of completion of a contract is recognised on the basis of the
incurred percentage of anticipated cost, which in the opinion of
the Directors, is the most appropriate proxy for the stage of
completion. This is applied only to significant long term projects
spanning the year end, however there were no such contracts at the
current or prior year end. Provision is made for losses as soon as
they are foreseeable.
Pensions
Defined contribution pension schemes
The Group operates three defined contribution schemes. The
assets of the schemes are held separately from those of the Group
in independently administered funds. The amount charged to the
income statement represents the contributions payable to the
schemes in respect to the accounting period.
Defined benefit pension schemes
The Group has one pension scheme providing benefits based on
final pensionable pay, which is unfunded and closed to further
accrual. The Group's net obligation in respect of the defined
benefit pension plan is calculated by estimating the amount of
future benefit that employees have earned in return for their
service in the current and prior periods; that benefit is
discounted to its present value; and any unrecognised past service
costs are deducted.
The liability discount rate is the yield at the balance sheet
date on AA credit-rated bonds that have maturity dates
approximating the terms of the Group's obligations. The calculation
is performed by a qualified actuary using the projected unit credit
method. When the calculation results in a benefit to the Group, the
benefit recognised is limited to the present value of any
reductions in future contributions to the plan.
The current service cost and costs from settlements and
curtailments are charged against operating profit. Past service
costs are recognised immediately within profit and loss. The net
interest cost on the defined benefit liability for the period is
determined by applying the discount rate used to measure the
defined benefit obligation at the end of the period to the net
defined benefit liability at the beginning of the period. It takes
into account any changes in the net defined benefit liability
during the period as a result of contributions and benefit
payments. Re-measurements of the defined benefit pension liability
are recognised in full in the period in which they arise in the
statement of comprehensive income.
1. Accounting policies (continued)
Trade and other receivables
Trade receivables are carried at amortised cost, less provision
for impairment. Any change in their value through impairment or
reversal of impairment is recognised in the income statement.
Trade and other payables
Trade and other payables are stated at their cost less payments
made.
Dividends
Dividends unpaid at the balance sheet date are only recognised
as liabilities at that date to the extent that they are
appropriately authorised and are no longer at the discretion of the
Company.
Cash and cash equivalents
Cash and cash equivalents in the balance sheet comprise cash
balances and call deposits with an original maturity of three
months or less. Bank overdrafts that are repayable on demand and
form an integral part of the Group's cash management are included
as a component of cash and cash equivalents for the purpose of the
statement of cash flows.
Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at fair
value less directly attributable transaction costs. Subsequent to
initial recognition, interest-bearing borrowings are stated at
amortised cost with any difference between cost and redemption
value being recognised in the income statement over the period of
the borrowings on an effective interest basis.
Income tax
Income tax on the profit or loss for the year comprises current
and deferred tax. Income tax is recognised in the income statement,
except to the extent that it relates to items recognised directly
in equity, in which case it is recognised directly in equity or in
other comprehensive income.
Current tax is the expected tax payable on the taxable income
for the year, using tax rates enacted, or substantively enacted at
the balance sheet date, and any adjustment to tax payable in
respect of previous years.
Deferred tax is provided using the balance sheet method,
providing for temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the
amounts used for taxation purposes. The following temporary timing
differences are not recognised:
-- Goodwill not deductible for tax purposes; and
-- Initial recognition of assets or liabilities in a transaction
that is not a business combination and that affects neither
accounting nor taxable profits.
-- Temporary differences related to investments in subsidiaries,
to the extent that it is probable that they will not reverse in the
foreseeable future.
A deferred tax asset is recognised to the extent that it is
probable that future taxable profits will be available against
which the temporary differences can be utilised. Deferred tax
assets are reviewed at each reporting date and are reduced to the
extent that it is no longer probable that the related tax benefit
will be realised.
Deferred tax is recognised at the tax rates that are expected to
be applied to the temporary differences when they reverse, based on
rates that have been enacted or substantially enacted by the
reporting date.
Leased assets
Leases in which the Group assumes substantially all the risks
and rewards of ownership are classified as finance leases. All
other leases are classified as operating leases.
As lessee
Rental operating leases are charged to the income statement on a
straight-line basis over the lease term. Lease incentives granted
are recognised as an integral part of the total rental income.
1. Accounting policies (continued)
As lessor
Assets under hire purchase agreements are shown in the balance
sheet under current assets to the extent they are due within one
year, and under non-current assets to the extent that they are due
after more than one year, and are stated at the value of the net
investment in the agreements. The income from such agreements is
credited to the income statement each year so as to give a constant
rate of return on the funds invested.
Assets held for leasing out under operating leases are included
in investment property (where they constitute land and buildings)
or in property, plant and equipment (where they do not constitute
land and buildings) at cost less accumulated depreciation and
impairment losses. Rental income is recognised on a straight-line
basis.
Rental income is received from investment property rentals in
the Falklands. This income from operating leases is charged to the
income statement on a straight-line basis over the lease term.
Lease incentives granted are recognised as an integral part of the
total rental income. None of these lease agreements exceed a twelve
month period.
Finance lease payments
Minimum lease payments are apportioned between the finance
charge and reduction of the outstanding liability. The finance
charge is allocated to each period of the lease term so as to
produce a constant periodic rate of interest on the remaining
balance of the liability.
Cash-flow hedges
The effective portions of changes in the fair values of
derivatives that are designated and qualify as cash-flow hedges are
recognised in equity. The gain or loss to any ineffective portion
is recognised immediately in the income statement. Amounts
accumulated in the hedging reserve are recycled to the income
statement in the periods when the hedged items will affect profit
or less.
New, amended and revised IFRSs and International Financial
Reporting Interpretations Committee pronouncements ("IFRICs")
The following IFRSs and amendments and revisions to IFRSs which
were effective for the first time in the year ended 31 March 2017
did not have any material impact on the consolidated financial
statements:
Amendments and revisions to IFRSs Effective date
Periods beginning
on or
after:
Accounting for Acquisitions of Interests
in Joint Operations - Amendments to IFRS
11 1 January 2016
Clarification of Acceptable Methods of
Depreciation and Amortisation - Amendments
to IAS 16 and IAS 38 1 January 2016
Equity Method in Separate Financial Statements
- Amendments to IAS 27 1 January 2016
Annual Improvements to IFRSs - 2012-2014
Cycle 1 January 2016
Disclosure Initiative - Amendments to
IAS 1 1 January 2016
Future adoption of new standards
The following standards, which have not yet been applied in the
preparation of the consolidated financial statements were in issue,
but were not yet effective, and in some cases, had not yet been
adopted by the EU:
IFRS 9: Financial Instruments
IFRS 15: Revenue from Contracts with Customers
IFRS 16 : Leases
The Directors do not anticipate that the adoption of these new
IFRSs and amendments and revisions to IFRSs will have a material
impact on the consolidated financial statements in the period of
initial application, except for the adoption of IFRS 16: Leases, as
the change in the accounting treatment of operating leases, will
have a significant impact on the Group's financial statements
resulting from a the revised treatment of the ground rent payable
on the 50 year lease for the Gosport pontoon, and the significant
rental payments incurred on the storage facilities at Momart.
2. Segmental Information Analysis
The Group is organised into three operating segments, and
information on these segments is reported to the chief operating
decision maker ('CODM') for the purposes of resource allocation and
assessment of performance. The CODM has been identified as the
Board of Directors.
The operating segments offer different products and services and
are determined by business type: goods and essential services in
the Falkland Islands, the provision of ferry services and art
logistics and storage.
Segment results, assets and liabilities include items directly
attributable to a segment as well as those that can be allocated on
a reasonable basis. Segment capital expenditure is the total cost
incurred during the period to acquire property, plant and equipment
and intangible assets other than goodwill and any other assets
purchased through the acquisition of a business.
2. Segmental Information Analysis (continued)
2017
General Ferry Art logistics
trading Services and storage
(Falklands) (Portsmouth) (UK) Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue 17,828 4,286 18,380 - 40,494
--------------------------- ------------ ------------- -------------- ------------ ---------
Segment operating
profit before tax,
amortisation &
non-trading items 1,209 1,058 538 - 2,805
Restructuring costs - - - (530) (530)
Gain on sale of
vessel - 76 - - 76
Amortisation - - (136) - (136)
--------------------------- ------------ ------------- -------------- ------------ ---------
Segment operating
profit 1,209 1,134 402 (530) 2,215
Share of result
of joint venture 24 - - - 24
Reversal of Impairment - - - 81 81
Profit before net
financing costs 1,233 1,134 402 (449) 2,320
Interest income 14 4 3 - 21
Interest expense (88) (349) (17) - (454)
--------------------------- ------------ ------------- -------------- ------------ ---------
Net finance expense (74) (345) (14) - (433)
--------------------------- ------------ ------------- -------------- ------------ ---------
Segment profit
before tax 1,159 789 388 (449) 1,887
--------------------------- ------------ ------------- -------------- ------------ ---------
Assets and liabilities
Segment assets 33,381 16,556 16,279 12 66,228
Segment liabilities (11,419) (9,359) (4,956) (749) (26,483)
Segment net assets 21,962 7,197 11,323 (737) 39,745
--------------------------- ------------ ------------- -------------- ------------ ---------
Other segment information
Capital expenditure:
Property, plant
and equipment 578 241 971 - 1,790
Investment properties - - - - -
Total Capital Expenditure 578 241 971 - 1,790
--------------------------- ------------ ------------- -------------- ------------ ---------
Depreciation:
Property, plant
and equipment 492 447 385 - 1,324
Investment properties 72 - - - 72
Computer software - - 55 - 55
Total Depreciation 564 447 440 - 1,451
--------------------------- ------------ ------------- -------------- ------------ ---------
Amortisation of
intangible assets
on acquisition
of Momart - - 136 - 136
--------------------------- ------------ ------------- -------------- ------------ ---------
Underlying profit
before tax
Segment operating
profit 1,209 1,058 538 - 2,805
Share of results
of joint venture 24 - - - 24
Underlying profit
before net financing
costs 1,233 1,058 538 - 2,829
Interest income 14 4 3 - 21
Interest expense (88) (349) (17) - (454)
Underlying profit
before tax 1,159 713 524 - 2,396
--------------------------- ------------ ------------- -------------- ------------ ---------
2. Segmental Information Analysis (continued)
2016
General Ferry Art logistics
trading Services and storage
(Falklands) (Portsmouth) (UK) Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue 18,495 4,244 16,257 - 38,996
--------------------------- ------------ ------------- -------------- ------------ ---------
Segment operating
profit before tax,
amortisation &
non-trading items 1,819 1,028 460 - 3,307
Restructuring costs (178) - (83) - (261)
Gain on sale of
vessel - 60 - - 60
Gain on the sale
of FOGL shares - - - 388 388
Amortisation - - (136) - (136)
--------------------------- ------------ ------------- -------------- ------------ ---------
Segment operating
profit 1,641 1,088 241 388 3,358
Share of result
of joint venture 200 - - - 200
Impairment of Joint
Venture fixed assets (330) - - - (330)
Profit before net
financing costs 1,511 1,088 241 388 3,228
Interest income 17 3 7 - 27
Interest expense (99) (347) (10) - (456)
Net finance expense (82) (344) (3) - (429)
--------------------------- ------------ ------------- -------------- ------------ ---------
Segment profit
before tax 1,429 744 238 388 2,799
--------------------------- ------------ ------------- -------------- ------------ ---------
Assets and liabilities
Segment assets 33,150 16,323 13,630 15 63,118
Segment liabilities (10,821) (9,632) (3,463) (633) (24,549)
Segment net assets 22,329 6,691 10,167 (618) 38,569
--------------------------- ------------ ------------- -------------- ------------ ---------
Other segment information
Capital expenditure:
Property, plant
and equipment 1,213 223 402 - 1,838
Investment properties 16 - - - 16
Total Capital Expenditure 1,229 223 402 - 1,854
--------------------------- ------------ ------------- -------------- ------------ ---------
Depreciation:
Property, plant
and equipment 581 440 314 - 1,335
Investment properties 71 - - - 71
Computer software - - 53 - 53
Total Depreciation 652 440 367 - 1,459
--------------------------- ------------ ------------- -------------- ------------ ---------
Amortisation of
intangible assets
on acquisition
of Momart - - 136 - 136
--------------------------- ------------ ------------- -------------- ------------ ---------
Underlying profit
before tax
Segment operating
profit 1,819 1,028 460 - 3,307
Share of results
of joint venture 200 - - - 200
Underlying profit
before net financing
costs 2,019 1,028 460 - 3,507
Interest income 17 3 7 - 27
Interest expense (99) (347) (10) - (456)
Underlying profit
before tax 1,937 684 457 - 3,078
--------------------------- ------------ ------------- -------------- ------------ ---------
2. Segmental Information Analysis (continued)
The GBP12,000 (2016: GBP15,000) unallocated assets above include
GBP12,000 (2016: GBP15,000) of prepayments held in FIH group
plc.
The GBP749,000 (2016: GBP633,000) unallocated liabilities above
consist of accruals and tax balances held in FIH group plc.
3. Geographical analysis
The tables below analyse revenue and other information by
geography:
2017
United Falkland
Kingdom Islands Total
GBP'000 GBP'000 GBP'000
Revenue (by source) 22,666 17,828 40,494
--------------------------------------- --------- --------- --------
Assets and Liabilities
Non-current segment assets, excluding
deferred tax 24,563 12,157 36,720
--------------------------------------- --------- --------- --------
Capital expenditure 1,212 578 1,790
--------------------------------------- --------- --------- --------
2016
United Falkland
Kingdom Islands Total
GBP'000 GBP'000 GBP'000
Revenue (by source) 20,501 18,495 38,996
--------------------------------------- --------- --------- --------
Assets and Liabilities
Non-current segment assets, excluding
deferred tax 24,374 12,116 36,490
--------------------------------------- --------- --------- --------
Capital expenditure 625 1,229 1,854
--------------------------------------- --------- --------- --------
4. Revenue
2017 2016
GBP'000 GBP'000
Sale of goods 11,206 12,653
Rendering of services 29,288 26,343
------------------------ -------- --------
Total revenue 40,494 38,996
------------------------ -------- --------
5. Non-trading items and amortisation of intangible assets
2017 2016
GBP'000 GBP'000
Profit before tax as reported 1,887 2,799
Reverse non-trading items:
Costs incurred from the Takeover
bid 530 -
Restructuring costs - 261
Proceeds on the sale of vessels (76) (60)
(Reversal of impairment) / impairment
of the joint venture fixed assets (81) 330
Gain on the sale of 5,000,000 FOGL
shares - (388)
Amortisation charge on Momart intangible
assets acquired 136 136
------------------------------------------- -------- --------
Total non-trading items and amortisation 509 279
------------------------------------------- -------- --------
Underlying profit before tax 2,396 3,078
------------------------------------------- -------- --------
Tax on non-trading items
In the year ended 31 March 2017, a GBP30,000 tax credit has been
included in the Group's income statement in respect of the
GBP509,000 non-trading items, which includes a GBP45,000 deferred
tax credit on the intangible assets purchased in Momart in 2008,
offset against the GBP15,000 income tax payable on the profit
arising on the sale of fixed assets. The GBP530,000 of costs
incurred from the aborted Takeover bid have not been treated as a
tax deductible expense.
In the year ended 31 March 2016, a GBP122,000 tax credit has
been included in the Group's income statement in respect of the
GBP279,000 non-trading items, which includes a GBP71,000 deferred
tax credit on the intangible assets purchased in Momart in 2008,
and the GBP63,000 income tax deductible on the GBP261,000
restructuring costs, offset against the GBP12,000 income tax
payable on the profit arising on the sale of fixed assets. No tax
charge has arisen on the GBP388,000 gain on the sale of shares in
Falkland Oil and Gas Limited.
6. Expenses and auditor's remuneration
The following expenses
/ (incomes) have been included
in the profit and loss Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Direct operating expenses
of rental properties 263 142 - -
Depreciation 1,396 1,406 - -
Depreciation of computer
software 55 53 - -
Amortisation of intangible
assets 136 136 - -
Foreign currency losses 6 (2) - -
Impairment loss on trade
and other receivables 44 36 - -
Cost of inventories recognised
as an expense 9,552 9,884 - -
Operating lease payments 1,050 921 - -
--------------------------------- -------- -------- -------- --------
Auditor's remuneration 2017 2016
GBP'000 GBP'000
Audit of these financial statements 33 30
Other taxation services 4 4
Audit of subsidiaries' financial statements
pursuant to legislation 73 62
Other assurance services - 20
--------------------------------------------- -------- --------
Total auditor's remuneration 110 116
--------------------------------------------- -------- --------
Amounts paid to the Company's auditors and their associates in
respect of services to the Company, other than the audit of the
Company's financial statements, have not been disclosed as the
information is required instead to be disclosed on a consolidated
basis.
7. Staff numbers and cost
The average number of persons employed by the Group (including
Directors) during the year, analysed by category, was as
follows:
Number of employees Number of employees
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Ferry services 38 38 - -
Falkland Islands; in Stanley 159 172 - -
in UK 6 5 - -
Art logistics & storage 131 129 - -
Head office 4 4 4 4
Total average staff numbers 338 348 4 4
---------------------------------- ---------- ---------- ---------- ----------
The aggregate payroll cost of these persons was as follows:
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Wages and salaries 10,914 10,804 457 460
Share-based payments (see
note 24) 15 61 39 44
Social security costs 909 916 50 49
Contributions to defined
contribution plans 298 301 9 9
Total employment costs 12,136 12,082 555 562
--------------------------- -------- -------- -------- --------
Details of audited Directors' remuneration are provided in the
Directors' Report, under the heading 'Details of Directors'
Remuneration and Emoluments'.
8. Finance income and expense
2017 2016
GBP'000 GBP'000
Bank interest receivable 21 27
Total financial income 21 27
---------------------------- -------- --------
2017 2016
GBP'000 GBP'000
Interest payable on bank loans (127) (117)
Net interest cost on the FIC defined
benefit pension scheme liability (88) (90)
Finance lease interest payable (239) (240)
Unwinding of deferred consideration
payable - (9)
Total finance expense (454) (456)
---------------------------------------- -------- --------
9. Taxation
Recognised in the income statement
2017 2016
GBP'000 GBP'000
Current tax expense
Current year 357 370
Adjustments for prior years (25) 118
------------------------------- -------- --------
Current tax expense 332 488
Deferred tax expense
Origination and reversal
of temporary differences 166 230
Reduction in tax rate (65) (119)
Adjustments for prior years 27 (22)
Deferred tax expense 128 89
------------------------------- -------- --------
Total tax expense 460 577
------------------------------- -------- --------
Reconciliation of the effective tax rate
2017 2016
GBP'000 GBP'000
Profit on ordinary activities
before tax 1,887 2,799
-------------------------------------- -------- --------
Tax using the UK corporation
tax rate of 20% (2016: 20%) 377 560
Expenses not deductible for tax
purposes 174 58
Gain on disposal of investment - (78)
Effect of higher tax rate overseas - 23
Difference in the rate of deferred
tax (72) (108)
Income from joint ventures (21) 26
Adjustments to tax charge in
respect of previous periods 2 96
Total tax expense 460 577
-------------------------------------- -------- --------
Tax recognised directly in other comprehensive income
2017 2016
GBP'000 GBP'000
Deferred tax credit / (expense) recognised
directly in other comprehensive income 95 (56)
---------------------------------------------- -------- --------
Reductions in the UK corporation tax rate from 20% to 19% on 1
April 2017 and to 17% on 1 April 2020 were substantively enacted on
18 November 2015 and 15 October 2016 respectively. This will reduce
the Company's future current tax charge accordingly. The deferred
tax assets and liabilities at 31 March 2017 have been calculated
based on the rates substantively enacted at the balance sheet date.
In the UK deferred tax has been provided at 17%.
These planned changes in the future rates of UK corporation tax
will reduce the company's future current tax charge accordingly.
The deferred tax assets and liabilities in the United Kingdom at 31
March 2017 have been calculated based on the rates substantively
enacted at the balance sheet date.
The deferred tax assets and liabilities in the Falkland Islands
have been calculated at the Falklands' tax rate of 26%.
10. Earnings per share
The calculation of basic earnings per share is based on profits
on ordinary activities after taxation, and the weighted average
number of shares in issue in the period, excluding shares held in
Treasury and under the Employee Share Ownership Plan ('ESOP') (see
note 25).
The calculation of diluted earnings per share is based on
profits on ordinary activities after taxation and the weighted
average number of shares in issue in the period, excluding shares
held under the ESOP, adjusted to assume the full issue of share
options outstanding, to the extent that they are dilutive.
2017 2016
GBP'000 GBP'000
Profit on ordinary activities after taxation 1,427 2,222
---------------------------------------------- -------- --------
2017 2016
Number Number
Weighted average number of shares in
issue 12,431,715 12,431,623
Less: shares held in Treasury - (31,725)
Less: shares held under the ESOP (24,849) (28,016)
--------------------------------------------- ----------- -----------
Average number of shares in issue excluding
the ESOP and shares held in Treasury 12,406,866 12,371,882
Maximum dilution with regards to share
options 23,639 11,830
Diluted weighted average number of shares 12,430,505 12,383,712
--------------------------------------------- ----------- -----------
2017 2016
Basic earnings per share 11.5p 18.0p
Diluted earnings per share 11.5p 17.9p
---------------------------- ------ ------
To provide a comparison of earnings per share on underlying
performance, the calculation below sets out basic and diluted
earnings per share based on underlying profits.
Earnings per share on underlying profit 2017 2016
GBP'000 GBP'000
Underlying profit before tax (see note
5) 2,396 3,078
Taxation (490) (699)
------------------------------------------- ----------- -----------
Underlying profit after tax 1,906 2,379
Effective tax rate 20.5% 22.7%
Weighted average number of shares in
issue excluding Treasury shares and the
ESOP (from above) 12,406,866 12,371,882
Diluted weighted average number of shares
(from above) 12,430,505 12,383,712
Basic earnings per share on underlying
profit 15.4p 19.2p
Diluted earnings per share on underlying
profit 15.3p 19.2p
------------------------------------------- ----------- -----------
11. Intangible assets
Computer Customer Brand
Software relation-ships name Goodwill Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost:
At 31 March 2015 and
2016 479 1,274 2,823 11,576 16,152
Disposals - (1,274) - - (1,274)
---------------------------- ---------- ---------------- -------- --------- --------
At 31 March 2017 479 - 2,823 11,576 14,878
Accumulated amortisation:
At 1 April 2015 156 1,002 785 1,983 3,926
Depreciation of computer
software 53 - - - 53
Amortisation of other
intangibles for the
year - 136 - - 136
At 31 March 2016 209 1,138 785 1,983 4,115
Depreciation of computer
software 55 - - - 55
Disposals - (1,274) - - (1,274)
Amortisation of other
intangibles for the
year - 136 - - 136
At 31 March 2017 264 - 785 1,983 3,032
Net book value:
At 1 April 2015 323 272 2,038 9,593 12,226
---------------------------- ---------- ---------------- -------- --------- --------
At 31 March 2016 270 136 2,038 9,593 12,037
---------------------------- ---------- ---------------- -------- --------- --------
At 31 March 2017 215 - 2,038 9,593 11,846
---------------------------- ---------- ---------------- -------- --------- --------
Amortisation and impairment charges are recognised in operating
expenses in the income statement. Customer relationships are
ongoing relationships, both contractual and otherwise with
customers considered to be of future economic benefit to the Group
with estimated economic lives of 6 - 10 years. As at 31 March 2017
these intangibles assets were fully amortised. No further
amortisation of these intangible assets will now arise. The Momart
brand name has a carrying value of GBP2,038,000 and is considered
to be of future economic value to the Group with an estimated
indefinite useful economic life. It is reviewed annually for
impairment as part of the art logistics and storage review.
Goodwill
Goodwill is allocated to the Group's Cash Generating Units
(CGUs) which principally comprise its business segments. A segment
level summary of goodwill is shown below:
Art
logistics Ferry
and Services Falkland
storage (Ports-mouth) Islands Total
GBP'000 GBP'000 GBP'000 GBP'000
At 1 April 2015, 31 March
2016 and 31 March 2017 5,577 3,979 37 9,593
----------------------------- ----------- --------------- --------- --------
Impairment
The Group tests material goodwill annually for impairment or
more frequently if there are indications that goodwill and / or
indefinite life assets might be impaired. An impairment test is a
comparison of the carrying value of the assets of a CGU, based on a
value-in-use calculation, to their recoverable amounts. Where the
recoverable amount is less than the carrying value an impairment
results. During the year the goodwill and indefinite life
intangibles for each CGU was separately assessed and tested for
impairment, with no impairment charges resulting (2016: nil). As
part of testing goodwill and indefinite life intangibles for
impairment, forecasts of operating cash flows for the next 50 years
at PHFC and 25 years for Momart, have been used, which are based on
approved budgets and plans by the Board of FIH group plc. These
forecasts represent the best estimate of future performance of the
CGUs based on past performance and expectations for the market
development of the CGU.
11. Intangible assets (continued)
A number of key assumptions are used as part of impairment
testing. These key assumptions are made by management reflecting
past experience combined with their knowledge as to future
performance and relevant external sources of information.
Discount rates
Within impairment testing models, the cash flows of the Art
Logistics and Storage CGU have been discounted using a pre-tax
discount rate of 13.0% (2016: 13.5%), and the cash flows of the
Ferry Services have been discounted using a pre-tax discount rate
of 12.4% (2016: 12.4%). Management have determined that each rate
is appropriate as the risk adjustment applied within the discount
rate reflects the risks and rewards inherent to each CGU, based on
the industry and geographical location it is based within.
Long term growth rates
Long term growth rates of 2% over up to fifty years have been
used for all CGUs as part of the impairment testing models. This
growth rate does not exceed the long term average growth rate for
the UK, in which the CGUs operate. For both Ferry Services and Art
Logistics and Storage, the future cash flows are based on the
latest budgets and business plans, which take account of known
business conditions, and are therefore consistent with past
experience.
Other assumptions
Other assumptions used within impairment testing models include
an estimation of long term effective tax rate for the CGUs. The
long-term effective rate of tax assumption is consistent with
current tax rates. The terminal value is calculated based on the
Gordon Growth model.
Sensitivity to changes in assumptions
Using a discounted cash flow methodology necessarily involves
making numerous estimates and assumptions regarding growth,
operating margins, tax rates, appropriate discount rates, capital
expenditure levels and working capital requirements. These
estimates will likely differ from future actual results of
operations and cash flows, and it is possible that these
differences could be material. In addition, judgements are applied
by the Directors in determining the level of cash generating units
and the criteria used to determine which assets should be
aggregated. A difference in testing levels could further affect
whether an impairment is recorded and the extent of impairment
loss.
Assumptions specific to ferry services (Portsmouth)
Value in use was determined by discounting future cash flows in
line with the other assumptions discussed above. Management have
forecast consistent growth in cash flows of 2% in both the short
and long term. The value in use was determined to exceed the
carrying amount and no impairment has been recognised (2016:
GBPnil). It is not considered that a reasonably possible change in
any of these assumptions would generate a different impairment test
outcome to the one included in this annual report. The key
assumptions made in the estimation of future cash flows are the
passenger numbers and the average revenue per passenger.
Assumptions specific to arts logistics and storage (UK)
Value in use was determined by discounting future cash flows in
line with the other assumptions as discussed above. Cash flows were
projected based on approved budgets and plans over the forecast
period, with a long term growth rate of 2%. The carrying value of
the unit was determined to not be higher than its recoverable
amount and no impairment was recognised (2016: nil). The key
assumptions made in the estimation of future cash flows are in
relation to revenue. Sensitivity analysis as at 31 March 2017
indicated that should the discount rate increase by 1%, (existing
assumption 13.0%) pre-tax cash flows decrease by 10% or the growth
rate by 1% (existing assumption 2%) this would result in an
impairment charge being recognised of between GBP0.8 million to
GBP1.0 million in the financial statements in respect of the
valuation of the goodwill and intangible in relation to Momart.
12. Property, plant and equipment
Group
Long
Freehold leasehold Vehicles,
Land Land plant
& buildings and buildings Ships and equipment Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost:
At 1 April 2015 6,944 7,095 6,702 8,613 29,354
Additions in year 948 161 109 620 1,838
Transfer to stock - - - (202) (202)
Disposals (50) (19) - (1,225) (1,294)
--------------------------- ------------- --------------- -------- --------------- --------
At 31 March 2016 7,842 7,237 6,811 7,806 29,696
Additions in year 122 818 19 831 1,790
Transfer to investment
properties (170) - - - (170)
Transfer to stock - - - (221) (221)
Disposals - - - (155) (155)
At 31 March 2017 7,794 8,055 6,830 8,261 30,940
--------------------------- ------------- --------------- -------- --------------- --------
Accumulated depreciation:
At 1 April 2015 1,829 1,067 1,378 5,459 9,733
Charge for the
year 152 231 229 723 1,335
Transfer to stock - - - (94) (94)
Disposals (50) (16) - (1,142) (1,208)
--------------------------- ------------- --------------- -------- --------------- --------
At 1 April 2016 1,931 1,282 1,607 4,946 9,766
Charge for the
year 280 142 247 655 1,324
Transfer to stock - - - (135) (135)
Transfer to investment
properties (7) - - - (7)
Disposals - - - (155) (155)
--------------------------- ------------- --------------- -------- --------------- --------
At 31 March 2017 2,204 1,424 1,854 5,311 10,793
Net book value:
At 1 April 2015 5,115 6,028 5,324 3,154 19,621
--------------------------- ------------- --------------- -------- --------------- --------
At 31 March 2016 5,911 5,955 5,204 2,860 19,930
--------------------------- ------------- --------------- -------- --------------- --------
At 31 March 2017 5,590 6,631 4,976 2,950 20,147
--------------------------- ------------- --------------- -------- --------------- --------
At 31 March 2017 the net carrying amount of leased long
leasehold land and buildings and vehicles, plant and equipment was
GBP4,385,000 and GBP346,000 for the Gosport Pontoon and trucks at
Momart respectively, (2016: GBP4,481,000 and GBP532,000). During
the year to 31 March 2017, Momart acquired one van on hire
purchase, which cost GBP38,000 and was funded by a GBP25,000
finance lease. During the year ending 31 March 2016, Momart
acquired two sprinter vans and a truck on hire purchase, which cost
GBP177,000 and were funded by GBP158,000 of finance leases.
At 31 March 2016, GBP79,000 was included within long leasehold
properties in respect of the construction of the storage facilities
for Momart which have now been completed.
The Company has no tangible fixed assets.
13. Investment properties
Group
Residential
and commercial Freehold
property land Total
GBP'000 GBP'000 GBP'000
Cost:
At 1 April 2015 3,460 723 4,183
Additions in year 16 - 16
Disposals (9) - (9)
------------------------------------- ---------------- --------- --------
At 31 March 2016 3,467 723 4,190
Transfer from Freehold properties 132 38 170
At 31 March 2017 3,599 761 4,360
Accumulated depreciation:
At 1 April 2015 490 - 490
Charge for the year 71 - 71
Disposals (3) (3)
At 31 March 2016 558 - 558
Transfer from Freehold properties 7 - 7
Charge for the year 72 - 72
At 31 March 2017 637 - 637
------------------------------------- ---------------- --------- --------
Net book value:
At 1 April 2015 2,970 723 3,693
------------------------------------- ---------------- --------- --------
At 31 March 2016 2,909 723 3,632
------------------------------------- ---------------- --------- --------
At 31 March 2017 2,962 761 3,723
------------------------------------- ---------------- --------- --------
The investment properties comprise residential and commercial
property held for rental in the Falkland Islands. Investment
properties include 400 acres, including 70 acres of land in
Stanley, 58 acres of which have planning permission. In addition,
the Group has 300 acres of land on the North shore of Stanley
Harbour at Fairy Cove. These investment properties held by FIC have
been reviewed by a Directors of FIC who are resident in the
Falkland Islands and who are considered to have the relevant
knowledge and experience to undertake the valuation. Independent
advice has also been taken from a local property expert. At 31
March 2017 the fair value of this property portfolio was estimated
at GBP7.2 million (31 March 2016: GBP7.0 million) an uplift on book
value of GBP4.2 million. Development land was valued at GBP2.2
million (2016: GBP2.2 million), an uplift on book value of GBP1.4
million.
During the year to 31 March 2017, the Group received rental
income of GBP424,000 (2016: GBP565,000) from its investment
properties and from the ten mobile homes rented to staff, which are
held in long leasehold property.
At 31 March 2017 and 2016 no investment properties were under
construction.
The Company does not own any investment properties.
14. Investment in subsidiaries
Country Class of shares Ownership Ownership
of held at at
incorporation 31 March 31 March
2017 2016
The Falkland Islands Ordinary shares
Company Limited (1) UK of GBP1 100% 100%
Preference
shares of
GBP10 100% 100%
The Falkland Islands
Trading Company Limited Ordinary shares
(1) UK of GBP1 100% 100%
Falkland Islands Shipping Falkland Ordinary shares
Limited (2) (6) Islands of GBP1 100% 100%
Falkland Ordinary shares
Erebus Limited(2)(6) Islands of GBP1 100% 100%
Preference
shares of
GBP1 100% 100%
South Atlantic Support
Services Limited(3) Falkland Ordinary shares
(6) Islands of GBP1 100% -
Falkland Ordinary shares
Paget Limited(4) (6) Islands of GBP1 100% 100%
The Portsmouth Harbour Ordinary shares
Ferry Company Limited(4) UK of GBP1 100% 100%
Portsea Harbour Company Ordinary shares
Limited(4) (6) UK of GBP1 100% 100%
Clarence Marine Engineering Ordinary shares
Limited(4) (6) UK of GBP1 100% 100%
Gosport Ferry Limited(4) Ordinary shares
(6) UK of GBP1 100% 100%
Momart International Ordinary shares
Limited(5) UK of GBP1 100% 100%
Ordinary shares
Momart Limited(5) (6) UK of GBP1 100% 100%
Ordinary shares
Dadart Limited(5) (6) UK of GBP1 100% 100%
(1) The registered office for these companies is Kenburgh Court,
133-137 South Street, Bishop's Stortford, Hertfordshire CM23
3HX.
(2) The registered office for these companies is 5 Crozier
Place, Stanley, Falkland Islands FIQQ 1ZZ.
(3) South Atlantic Support Services Limited's registered office
is 56 John Street, Stanley, Falkland Islands FIQQ 1ZZ
(4) The registered office for these companies is South Street,
Gosport, Hampshire, PO12 1EP.
(5) The registered office for these companies is Exchange Tower,
6(th) Floor, 2 Harbour Exchange Square, London E14 9GE.
(6) These investments are not held by the Company but are
indirect investments held through a subsidiary of the Company.
Company
2017 2016
GBP'000 GBP'000
At 1 April 2016 28,164 28,249
Impairment of subsidiaries (511) (102)
Share based payments (credit) /
charge capitalised into subsidiaries (24) 17
At 31 March 2017 27,629 28,164
------------------------------------------ -------- --------
The Company's investment in Momart was impaired by GBP511,000 in
the year to 31 March 2017, due to lower future expected levels of
profitability. In the year to 31 March 2016, Erebus Limited was
impaired by GBP102,000 following to the disposal of the final
5,000,000 shares in Falkland Oil and Gas.
15. Investment in Joint Venture
The Group has one joint venture (South Atlantic Construction
Company Limited, "SAtCO"), which was set up in June 2012, with
Trant Construction to bid for the larger infrastructure contracts
which were expected to be generated by oil activity. Both Trant
Construction and the Falkland Islands Company contributed GBP50,000
of ordinary share capital. SAtCO is registered and operates in the
Falkland Islands. During the year ended 31 March 2016, an
impairment was made against certain plant and machinery owned by
SAtCO, which was partly reversed in the year ended 31 March 2017
due to a sale of these assets during the year. The net assets of
SAtCO are shown below:
Joint Venture's balance sheet 2017 2016
GBP'000 GBP'000
Current assets 744 1,269
Liabilities due in less than one
year (262) (470)
Liabilities due in greater than
one year - (527)
------------------------------------- -------- --------
Net assets of SAtCO 482 272
------------------------------------- -------- --------
Group share of net assets 241 136
------------------------------------- -------- --------
2017 Before 2017 2017 After
Impairment Impairment Impairment
Joint Venture's results reversal reversal Reversal 2016
GBP'000 GBP'000 GBP'000 GBP'000
Revenue 64 - 64 616
Cost of sales - - - (95)
Administrative expenses (4) - (4) (11)
------------------------------------ ------------ ------------ ------------ --------
Operating profit for the
year 60 - 60 510
Impairment reversal / (impairment) - 206 206 (866)
------------------------------------ ------------ ------------ ------------ --------
Profit before taxation 60 206 266 (356)
Taxation (12) (44) (56) 96
------------------------------------ ------------ ------------ ------------ --------
Joint Venture retained
profit / (loss) for the
year 48 162 210 (260)
------------------------------------ ------------ ------------ ------------ --------
Group share of retained
profit / (loss) for the
year 24 81 105 (130)
------------------------------------ ------------ ------------ ------------ --------
There were no recognised gains or losses, other than the profits
disclosed above for the year ended 31 March 2017 (2016: none).
There was no depreciation charged in the year ended 31 March 2017
(2016: GBP95.000).
The current assets balances above include GBP103,000 of cash
(2016: GBP512,000). The liabilities due in less than one year are
all trade payables and corporation tax payable. The liabilities due
in greater than one year in the prior year, consisted of loans to
the parent companies of GBP527,000.
SAtCO had no contingent liabilities or capital commitments as at
31 March 2017 or 31 March 2016 and the Group had no contingent
liabilities or commitments in respect of its joint venture at 31
March 2017 or 31 March 2016.
16. Finance leases receivable
Finance lease receivables relate to finance leases on the sale
of vehicles and customer goods in the Falkland Islands. No
contingent rents have been recognised as income in the period. No
residual values accrue to the benefit of the lessor.
Group
2017 2016
GBP'000 GBP'000
Non-Current : Finance Lease debtors
due after more than one year 763 755
Current : Finance lease debtors
due within one year 799 810
Total Finance Lease debtors 1,562 1,565
---------------------------------------- -------- --------
The difference between the gross investment in the hire purchase
leases and the present value of future lease payments due
represents unearned finance income of GBP314,000 (2016:
GBP133,000).
The cost of assets acquired for the purpose of renting out under
hire purchase agreements by the Group during the year amounted to
GBP962,000 (2016: GBP1,316,000).
The aggregate rentals receivable during the year in respect of
hire purchase agreements were GBP1,167,000 (2016:
GBP1,029,000).
Group
2017 2016
GBP'000 GBP'000
Gross investment in hire purchase
leases 1,876 1,698
------------------------------------------- -------- --------
Present value of future lease payments
due:
Within one year 799 810
Within two to five years 763 755
Total present value of future lease
payments 1,562 1,565
------------------------------------------- -------- --------
17. Deferred tax assets and liabilities
Recognised deferred tax assets
and (liabilities) Group
2017 2016
GBP'000 GBP'000
Property, plant & equipment (2,032) (1,865)
Intangible assets (346) (391)
Inventories 9 28
Other financial liabilities 32 39
Share-based payments 26 -
Tax losses 120 120
----------------------------------------- -------- --------
Total net deferred tax liabilities (2,191) (2,069)
Deferred tax asset arising on the
defined benefit pension liabilities 776 687
----------------------------------------- -------- --------
Net tax liabilities (1,415) (1,382)
----------------------------------------- -------- --------
17. Deferred tax assets and liabilities (continued)
The deferred tax asset on the defined benefit pension scheme
(see note 23) arises under the Falkland Islands tax regime and has
been presented on the face of the consolidated balance sheet as a
non-current asset as it is expected to be realised over a
relatively long period of time. All other deferred tax assets are
shown net against the non-current deferred tax liability shown in
the balance sheet.
Company
2017 2016
GBP'000 GBP'000
Other temporary differences 17 9
-------------------------------- -------- --------
Net tax asset 17 9
-------------------------------- -------- --------
Movement in deferred tax
assets / (liabilities) in
the year: Group
1 April Recognised Recognised 31 March
2016 in income in equity 2017
GBP'000 GBP'000 GBP'000 GBP'000
Property, plant & equipment (1,865) (167) - (2,032)
Intangible assets (391) 45 - (346)
Inventories 28 (19) - 9
Other financial liabilities 39 (7) - 32
Share-based payments - 26 - 26
Tax losses 120 - 120
Pension 687 (6) 95 776
Deferred tax movements (1,382) (128) 95 (1,415)
----------------------------- -------- ----------- ----------- ---------
Unrecognised deferred tax assets
Deferred tax assets of GBP113,000 (2016: GBP113,000) in respect
of capital losses have not been recognised as it is not considered
probable that there will be suitable chargeable gains in the
foreseeable future from which the underlying capital losses will
reverse.
Movement in deferred tax
asset in the year: Company
1 April Recognised Recognised 31 March
2016 in income in equity 2017
GBP'000 GBP'000 GBP'000 GBP'000
Other temporary difference 9 8 - 17
Deferred tax asset movements 9 8 - 17
------------------------------ -------- ----------- ----------- ---------
Movement in deferred tax
assets / (liabilities) in
the prior year: Group
1 April Recognised Recognised 31 March
2015 in income in equity 2016
GBP'000 GBP'000 GBP'000 GBP'000
Property, plant & equipment (1,669) (196) - (1,865)
Intangible assets (462) 71 - (391)
Inventories 15 13 - 28
Other financial liabilities 50 (11) - 39
Share-based payments 10 (10) - -
Tax losses 69 51 - 120
Pension 750 (7) (56) 687
Deferred tax movements (1,237) (89) (56) (1,382)
----------------------------- -------- ----------- ----------- ---------
17. Deferred tax assets and liabilities (continued)
Movement in deferred tax
asset in the prior year: Company
1 April Recognised Recognised 31 March
2015 in income in equity 2016
GBP'000 GBP'000 GBP'000 GBP'000
Other temporary difference 6 3 - 9
Deferred tax asset movements 6 3 - 9
------------------------------ -------- ----------- ----------- ---------
18. Inventories
Group
2017 2016
GBP'000 GBP'000
Work in progress 1,295 912
Goods in transit 764 606
Goods for resale 3,297 4,723
-------- --------
Total Inventories 5,356 6,241
---------------------- -------- --------
Goods in transit are retail goods in transit to the Falkland
Islands.
The Company has no inventories.
19. Trade and other receivables
Company
2017 2016
GBP'000 GBP'000
Non-Current
Amount owed by subsidiary undertakings 6,965 3,465
------------------------------------------- --- ------------ --------
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Current
Trade and other receivables 5,507 3,920 - -
Prepayments and accrued income 1,991 933 12 15
Total trade and other receivables 7,498 4,853 12 15
------------------------------------- -------- -------- -------- --------
Trade and other receivables increased substantially at 31 March
2017 due to the later timing of sales in the year. Carrying values
have been reviewed to ensure the amounts shown are fully
recoverable.
20. Cash and cash equivalents
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Cash and other cash equivalents
in the balance sheet 15,079 14,037 8,780 11,761
----------------------------------- -------- -------- -------- --------
21. Interest-bearing loans and borrowings
This note provides information about the contractual terms of
the Group's interest bearing loans and borrowings owed by the
Group, which are stated at amortised cost. For more information
regarding the maturity of the interest-bearing loans and lease
liabilities and about the Group and Company's exposure to interest
rate and foreign currency risk, see note 25.
Group
2017 2016
GBP'000 GBP'000
Non-current liabilities
Secured bank loans 3,321 2,863
Lease liabilities 4,903 4,992
------------------------------------- -------- --------
Total non-current interest bearing
loans and lease liabilities 8,224 7,855
------------------------------------- -------- --------
Current liabilities
Secured bank loans 507 401
Lease liabilities 108 145
------------------------------------- -------- --------
Total current interest bearing
loans and lease liabilities 615 546
------------------------------------- -------- --------
Total liabilities
Secured bank loans 3,828 3,264
Lease liabilities 5,011 *5,137
------------------------------------ -------- --------
Total interest bearing loans
and lease liabilities 8,839 8,401
------------------------------------- -------- --------
Lease liabilities
Future minimum Interest Present value
lease payments of minimum
lease payments
2017 2016 2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Less than one
year 341 384 233 239 108 145
Between one
and two years 332 333 229 233 103 100
Between two
and five years 853 914 670 678 183 236
More than five
years 10,205 10,465 5,588 5,809 4,617 4,656
----------------- -------- -------- -------- -------- -------- --------
Total 11,731 12,096 6,720 6,959 5,011 *5,137
----------------- -------- -------- -------- -------- -------- --------
Net cash
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Cash balances (see note
20) 15,079 14,037 8,780 11,761
less: Total interest-bearing
loans and borrowings *(8,839) *(8,401) - -
Net cash 6,240 5,636 8,780 11,761
-------------------------------- --------- --------- -------- --------
*Included within lease liabilities is GBP4,797,000 (2016:
GBP4,828,000) in respect of the long term lease liability for the
Gosport pontoon, with quarterly payments of GBP65,000 payable to
Gosport Borough Council over the next forty-four years until
2061.
22. Trade and other payables
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Current
Trade payables 6,861 6,612 - -
Amounts owed to subsidiary
undertakings - - 2,500 2,500
Loan from joint venture 200 - - -
Other creditors, including
taxation and social security 1,257 1,482 129 134
Interest rate swap liability 71 87 71 87
Accruals and deferred income 3,897 3,063 687 467
Total trade and other payables 12,286 11,244 3,387 3,188
---------------------------------- -------- -------- -------- --------
23. Employee benefits: pension plans
The Group operates three defined contribution pension schemes.
In addition, it also operates one unfunded defined benefit pension
scheme in the Falkland Islands, which has been closed to new
members and to future accrual since 1 April 2007. During the year
ended 31 March 2017, 17 pensioners (2016: 18) received benefits
from this scheme, and there are three deferred members at 31 March
2017 (2016: three). Benefits are payable on retirement at the
normal retirement age. The weighted average duration of the
expected benefit payments from the Scheme is around 16 years (2016:
16 years).
Defined contribution schemes
The pension cost charge for the year represents contributions
payable by the Group to the schemes and amounted to GBP298,000
(2016: GBP301,000). The Group anticipates paying contributions
amounting to GBP302,000 during the year ending 31 March 2017. There
were outstanding contributions of GBP23,000 (2016: GBP33,000) due
to pension schemes at 31 March 2017.
Defined benefit pension schemes
A summary of the fair value of the net pension scheme deficit is
set out below:
Group
2017 2016
GBP'000 GBP'000
Pension scheme deficit:
The Falkland Islands Company Limited
Scheme (2,985) (2,644)
Deferred tax asset 776 687
-------- --------
Net pension scheme deficit (2,209) (1,957)
----------------------------------------- -------- --------
The Falkland Islands Company Limited Scheme
The Falkland Islands Company Limited operates a defined benefit
pension scheme for certain former employees. This scheme was closed
to new members in 1988 and to further accrual on 31 March 2007. The
scheme has no assets and payments to pensioners are made out of
operating cash flows. The expected contributions for the year ended
31 March 2018 are GBP113,000. Actuarial reports for IAS 19 purposes
as at 31 March 2017, 2016, 2015, 2014, and 2013 were prepared by a
qualified independent actuary, Lane Clark and Peacock LLP. The
major assumptions used in the valuation were:
2017 2016
Rate of increase in salaries 2.5% 2.3%
Rate of increase in pensions in
payment and deferred pensions 2.5% 3.0%
Discount rate applied to scheme
liabilities 2.5% 3.4%
Inflation assumption 3.0% 3.1%
Average longevity at age 65 for
male current and deferred pensioners
(years) at accounting date 22.5 22.4
Average longevity at age 65 for
male current and deferred pensioners
(years) 20 years after accounting
date 24.7 24.6
23. Employee benefits: pension plans (continued)
The assumptions used by the actuary are chosen from a range of
possible actuarial assumptions, which due to the timescale covered,
may not necessarily be borne out in practice.
The estimated liabilities of the scheme increased from GBP2.6
million at 31 March 2016 to GBP2.9 million at 31 March 2017 due
principally to the use of lower discount rates to discount future
liabilities.
Sensitivity Analysis
The calculation of the defined benefit liability is sensitive to
the assumptions set out above. The following table summarises how
the impact of the defined benefit liability at 31 March 2017 would
have increased / (decreased) as a result of a change in the
respective assumptions by 0.1%
Effect on obligation
2017 2016
GBP'000 GBP'000
Discount rate +/- 0.1% 49 41
Inflation assumption +/- 0.1% (19) (17)
Life expectancy +/- one year (136) (111)
These sensitivities have been calculated to show the movement in
the defined benefit obligation in isolation, and assume no other
changes in market conditions at the accounting date.
Scheme liabilities
The present values of the scheme's liabilities, which are
derived from cash flow projections over long periods and thus
inherently uncertain, were:
Value at
2017 2016 2015 2014 2013
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Present value of
scheme liabilities (2,985) (2,644) (2,884) (2,480) (2,584)
Related deferred
tax assets 776 687 750 645 671
----------------------- -------- -------- -------- -------- --------
Net pension liability (2,209) (1,957) (2,134) (1,835) (1,913)
----------------------- -------- -------- -------- -------- --------
Movement in deficit during the
year: 2017 2016
GBP'000 GBP'000
Deficit in scheme at beginning
of the year (2,644) (2,884)
Pensions paid 113 115
Other finance cost (88) (90)
Re-measurement of the defined benefit
pension liability (366) 215
------------------------------------------ -------- --------
Deficit in scheme at the end of
the year (2,985) (2,644)
------------------------------------------ -------- --------
Analysis of amounts included in
other finance costs: 2017 2016
GBP'000 GBP'000
Interest on pension scheme liabilities 88 90
------------------------------------------- -------- --------
Analysis of amounts recognised in statement
of comprehensive income: 2017 2016
GBP'000 GBP'000
Experience gains arising on scheme liabilities 59 26
Changes in assumptions underlying the
present value of scheme liabilities (425) 189
------------------------------------------------ -------- --------
Re-measurement of the defined benefit
pension liability (366) 215
------------------------------------------------ -------- --------
23. Employee benefits: pension plans (continued)
History of experience gains
and losses: 2017 2016 2015 2014 2013
Experience gains / (losses)
arising on scheme liabilities:
Amount (GBP'000) 59 26 76 20 (34)
Percentage of year end present
value of scheme liabilities (2.0%) (1.0%) (2.6%) (0.8%) 1.3%
Total amount recognised in statement
of comprehensive income:
Amount (GBP'000) (366) 215 (412) 135 (173)
Percentage of year end present
value of scheme liabilities 12.3% (8.1%) 14.3% (5.4%) 6.7%
Payment to pensioners 113 115 115 122 111
24. Employee benefits: share based payments
The following options were outstanding at 31 March 2017:
Share Fair
Date Number Exercise price value Total
of Issue Price at grant per fair Earliest Latest
date share value Exercise Exercise
pence pence pence GBP Date date
7 Aug 7 Aug 6 Aug
07 27,517 330.0 332.5 73.0 20,087 10 17
4 Dec 4 Dec 3 Dec
07 7,500 319.0 340.0 119.0 8,925 10 17
3 Apr 3 Apr 2 Apr
08 3,517 365.0 375.0 131.0 4,607 11 18
8 Apr 8 Apr 7 Apr
09 51,719 207.5 207.5 56.0 28,963 12 19
15 Jul 15 Jul 14 Jul
09 44,550 290.0 290.0 72.0 32,076 12 19
9 Dec 9 Dec 8 Dec
09 13,000 390.0 397.5 145.0 18,850 12 19
21 Dec 21 Dec 20 Dec
10 10,586 342.5 337.5 124.0 13,127 13 20
16 Dec 16 Dec 15 Dec
11 99,518 267.5 261.5 68.0 67,672 14 21
03 Sep 03 Sep 02 Sep
14 13,154 353.5 353.5 100.0 13,154 17 24
19 Jan 19 Jan 18 Jan
15 5,000 272.5 272.5 63.0 3,150 18 25
276,061 210,611
------------ --------- ----------- ---------- ------- -------- ---------- ----------
The total number of options outstanding at 31 March 2017,
excluding the 33,911 nil cost options, was 276,061 (2016: 500,615).
A reconciliation of the movement in options is shown below. The
fair values of the options are estimated at the date of grant using
appropriate option pricing models and are charged to the profit and
loss account over the expected life of the options. The following
table gives the assumptions made in determining the fair value of
the unvested options.
19 Jan
2015
--------------------- -------
Expected Volatility
(%) 37
Risk free interest
rate (%) 1.23
Expected life
of options (years) 6.5
Dividend yield
(%) 4.22
Share price at
grant date (pence) 272.5
--------------------- -------
Expected volatility is determined by reference to past
performance of the Company's share price. All options are granted
with the condition that the employee remains in employment for
three years. Certain option grants also have conditions attached in
that increases in earnings per share on underlying profits over the
vesting period must exceed the UK Retail price index increase, and
options granted to directors of the Company have a condition that
the Group's total shareholder return increase must exceed that of
the FTSE AIM All-Share Index over the three year period.
24. Employee benefits: share based payments (continued)
All share options are equity settled. Share options issued
without share price conditions attached have been valued using the
Black-Scholes model. Share price options issued with share price
conditions attached have been valued using a Monte Carlo simulation
model making explicit allowance for share price targets. During the
year ending 31 March 2017, 24,761 options were exercised over
ordinary shares (None were exercised in the year ending 31 March
2016). The number and weighted average exercise prices of share
options are as follows:
Weighted Weighted
average average
exercise exercise
price Number price Number
(GBP) of options (GBP) of options
2017 2017 2016 2016
Outstanding at the beginning
of the year 3.10 500,615 3.35 727,198
Options exercised during
the year 2.75 (24,761) - -
Forfeited during the year 3.20 (90,677) 3.82 (25,000)
Lapsed during the year 3.83 (109,116) 3.89 (201,583)
------------------------------ ---------- ------------ ---------- ------------
Outstanding at the year
end 2.82 276,061 3.10 500,615
------------------------------ ---------- ------------ ---------- ------------
Vested options exercisable
at the year end 2.78 257,907 3.06 452,651
------------------------------ ---------- ------------ ---------- ------------
Weighted average life of
outstanding options (years) 3.3 4.6
------------------------------ ---------- ------------ ---------- ------------
The range of exercise prices of outstanding options at 31 March
2017 is from GBP2.075 (2016: GBP2.075) to GBP3.90 (2016: GBP4.250).
In addition to the options above, 18,817 nil cost options were
granted to John Foster on 17 June 2016. On 10 June 2015, 22,642 nil
cost options were granted to John Foster and 7,548 of these options
were exercised in June 2016. These outstanding options are noted
below:
Share
Date Number Exercise price Fair Total
of Issue Price at grant value fair Earliest Latest
date per share value Exercise Exercise
pence pence pence GBP date Date
10 Jun 10 Jun 10 Jun
15 7,547 - 265.0 265.0 20,000 17 19
10 Jun 10 Jun 10 Jun
15 7,547 - 265.0 265.0 20,000 18 19
17 Jun 17 Jun 17 Jun
16 6,272 - 186.0 186.0 11,666 17 20
17 Jun 17 Jun 17 Jun
16 6,272 - 186.0 186.0 11,666 18 20
17 Jun 17 Jun 17 Jun
16 6,273 - 186.0 186.0 11,668 19 20
33,911 75,000
------------ --------- ----------- ---------- ----------- -------- ---------- ----------
2017 2016
GBP'000 GBP'000
Total share based payment expense
recognised in the year 15 61
------------------------------------------------------------- -------- ----------
25. Capital and reserves
Share capital Ordinary Shares
2017 2016
In issue at the start of the year 12,431,623 12,431,623
Share capital issued during the
year 2,795 -
------------------------------------ ----------- -----------
In issue at the end of the year 12,434,418 12,431,623
--------------------------------------- ----------- -----------
2017 2016
GBP'000 GBP'000
Allotted, called up and fully paid
Ordinary shares of 10p each 1,243 1,243
--------------------------------------- ----------- -----------
By special resolution at an Annual General Meeting on 9
September 2010 the Company adopted new articles of association
principally to take account of the various changes in company law
brought in by the Companies Act 2006. As a consequence the Company
no longer has an authorised share capital. The holders of ordinary
shares are entitled to receive dividends as declared from time to
time and are entitled to one vote per share at meetings of the
Company.
On 31 March 2000, an Employee Share Ownership Plan was
established. At 31 March 2017 the plan held 24,016 (2016: 28,016)
ordinary shares at a cost of GBP47,152 (2016: GBP55,005). The
market value of the shares at 31 March 2017 was GBP72,648 (2016:
GBP56,312). Shares held in the ESOP are entitled to receive a
nominal 0.01p per share in each dividend payment.
For more information on share options please see note 24.
The other reserves in the Group comprise largely of merger
relief arising in connection with the acquisition of Momart
International Limited. These have been offset by a recognised
impairment of Momart in the year ended 31 March 2009.
Dividends
No dividends were recognised in the current or prior period
26. Financial instruments
(i) Fair values of financial instruments
Trade and other receivables
The fair value of trade and other receivables is estimated as
the present value of future cash flows, discounted at the market
rate of interest at the balance sheet date if the effect is
material.
Trade and other payables
The fair value of trade and other payables is estimated as the
present value of future cash flows, discounted at the market rate
of interest at the balance sheet date if the effect is
material.
Cash and cash equivalents
The fair value of cash and cash equivalents is estimated as its
carrying amount where the cash is repayable on demand. Where it is
not repayable on demand then the fair value is estimated at the
present value of future cash flows, discounted at the market rate
of interest at the balance sheet date.
Interest- bearing borrowings
The fair value of interest-bearing borrowings, which after
initial recognition is determined for disclosure purposes only, is
calculated based on the present value of future principal and
interest cash flows, discounted at the market rate of interest at
the balance sheet date.
IAS 39 categories and fair values
The fair values of financial assets and financial liabilities
are not materially different to the carrying values shown in the
consolidated balance sheet and Company balance sheet.
The following table shows the carrying value, which is equal to
fair value for each category of financial instrument:
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Cash and cash equivalents 15,079 14,037 8,780 11,761
Hire purchase debtors 1,562 1,565 - -
Trade and other receivables 5,507 3,920 - -
---------------------------------- --------- --------- -------- --------
Total assets exposed to
credit risk 22,148 19,522 8,780 11,761
---------------------------------- --------- --------- -------- --------
Interest rate swap liability (71) (87) (71) (87)
Other Financial liabilities
at amortised cost (12,215) (11,157) (3,316) (3,101)
Total trade and other payables (12,286) (11,244) (3,387) (3,188)
Interest-bearing borrowings
at amortised cost (8,839) (8,401) - -
---------------------------------- --------- --------- -------- --------
Available for sale financial assets are valued using a level 1
methodology. The interest rate swap has been valued using a level 2
methodology. All other financial instruments are based on level 3
methodology.
26. Financial instruments (continued)
(ii) Credit Risk
Financial risk management
Credit risk is the risk of financial loss to the Group if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations, and arises principally from the
Group's receivables from customers.
Group
The Group's credit risk is primarily attributable to its trade
receivables. The maximum credit exposure of the Group comprises the
amounts presented in the balance sheet, which are stated net of
provisions for doubtful debt. A provision is made where there is an
identified loss event which, based on previous experience, is
evidence of a reduction in the recoverability of future cash flows.
Management has credit policies in place to manage risk on an
on-going basis. These include the use of customer specific credit
limits.
Company
The majority of the Company's receivables are with subsidiaries.
The Company does not consider these counter-parties to be a
significant credit risk.
Exposure to credit risk
The carrying amount of financial assets, other than available
for sale financial assets represents the maximum credit exposure.
Therefore, the maximum exposure to credit risk at the balance sheet
date was GBP22,148,000 (2016: GBP19,522,000) being the total trade
receivables, hire purchase debtors and cash and cash equivalents in
the balance sheet. The credit risk on cash balances and the
interest rate swap is limited because the counterparties are banks
with high credit ratings assigned by international credit-rating
agencies.
The maximum exposure to credit risk for trade receivables at the
balance sheet date by geographic region was:
Group
2017 2016
GBP'000 GBP'000
Falkland Islands 1,853 980
Europe 887 401
North America 467 345
United Kingdom 1,942 1,687
Other 358 507
---------------------------- -------- --------
Total trade receivables 5,507 3,920
---------------------------- -------- --------
The Company has no trade debtors
Credit quality of financial assets and impairment losses
Group Gross Impairment Net Gross Impairment Net
2017 2017 2017 2016 2016 2016
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Not past due 3,765 - 3,765 2,932 - 2,932
Past due 0-30
days 942 - 942 619 - 619
Past due 31-120
days 212 (28) 184 133 - 133
More than 120
days 790 (174) 616 445 (209) 236
-------- ----------- -------- -------- ----------- --------
5,709 (202) 5,507 4,129 (209) 3,920
-------- ----------- -------- -------- ----------- --------
26. Financial instruments (continued)
The movement in the allowances for impairment in respect of
trade receivables during the year was:
Group
2017 2016
GBP'000 GBP'000
Balance at 1 April 2016 209 221
Impairment loss recognised 44 69
Impairment loss reversed - (33)
Cash received (4) (30)
Utilisation of provision (debts
written off) (47) (18)
------------------------------------ -------- --------
Balance at 31 March 2017 202 209
------------------------------------ -------- --------
The allowance account for trade receivables is used to record
impairment losses unless the Group is satisfied that no recovery of
the amount owing is possible: at that point the amounts considered
irrecoverable are written off against the trade receivables
directly.
No further analysis has been provided for cash and cash
equivalents, trade receivables from Group companies, other
receivables and other financial assets, as there is limited
exposure to credit risk and no provisions for impairment have been
recognised.
(iii) Liquidity risk
Financial risk management
Liquidity risk is the risk that the Group will not be able to
meet its financial obligations as they fall due.
At the beginning of the period the Group had outstanding bank
loans of GBP3.3 million. In December 2016, a further loan of GBP1.0
million was drawn down, to be repaid over ten years, which has been
secured against the assets of Momart International and Momart
Limited. All payments due during the year with respect to these
agreements were met as they fell due.
The Company had no bank loans at the start or end of the
year.
The Group manages its cash balances centrally at head office and
prepares rolling cash flow forecasts to ensure funds are available
to meet its secured and unsecured commitments as and when they fall
due.
Liquidity risk - Group
The following are the contractual maturities of financial
liabilities, including estimated interest payments and excluding
the effects of netting agreements:
Contractual cash
flows
2017 Carrying 5 years
amount 1 year 1 to 2 to and
Total or less 2 years 5 years over
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Non-derivative financial
liabilities
Secured bank loans 3,828 4,304 608 608 1,505 1,583
Finance leases 5,011 11,731 341 332 853 10,205
Trade payables 6,861 6,861 6,861 - - -
Interest rate swap
liability 71 103 37 31 35 -
Other creditors,
including taxation 1,257 1,257 1,257 - - -
Accruals and deferred
income 3,897 3,897 3,897 - - -
--------- -------- --------- --------- --------- --------
Total Non-derivative
financial liabilities 20,925 28,153 13,001 971 2,393 11,788
-------------------------- --------- -------- --------- --------- --------- --------
26. Financial instruments (continued)
Contractual cash
flows
2016 Carrying 5 years
amount 1 year 1 to 2 to and
Total or less 2 years 5 years over
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Non-derivative financial
liabilities
Secured bank loans 3,264 3,684 494 494 1,322 1,374
Finance leases 5,137 12,096 384 333 914 10,465
Trade payables 6,612 6,612 6,612 - - -
Interest rate swap
liability 87 146 43 37 66 -
Other creditors,
including taxation 1,482 1,482 1,482 - - -
Accruals and deferred
income 3,063 3,063 3,063 - - -
-------------------------- --------- -------- --------- --------- --------- --------
Total non-derivative
financial liabilities 19,645 27,083 12,078 864 2,302 11,839
-------------------------- --------- -------- --------- --------- --------- --------
The contractual cash flows for finance leases in the years ended
31 March 2017 and 31 March 2016 are significantly higher than the
liability at the year end, as the finance lease for the Gosport
pontoon with Gosport Borough Council is a 50 year finance lease
with quarterly payments of GBP65,000 until 2061.
Liquidity risk - Company
The following are the contractual maturities of financial
liabilities, including estimated interest payments and excluding
the effects of netting agreements:
Contractual cash
flows
2017 Carrying 5 years
amount 1 year 1 to 2 to and
Total or less 2 years 5 years over
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Non-derivative financial
liabilities
Interest rate swap
liability 71 103 37 31 35 -
Other creditors,
including taxation 129 129 129 - - -
Accruals and deferred
income 687 687 687 - - -
--------- -------- --------- --------- --------- --------
887 919 853 31 35 -
--------- -------- --------- --------- --------- --------
Contractual cash
flows
2016 Carrying 1 year 1 to 1 year
amount Total or less 2 years Total or less
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Non-derivative financial
liabilities
Interest rate swap
liability 87 146 43 37 66 -
Other creditors,
including taxation 134 134 134 - - -
Accruals and deferred
income 467 467 467 - - -
--------- -------- --------- --------- -------- ---------
688 747 644 37 66 -
--------- -------- --------- --------- -------- ---------
(iv) Market Risk
Financial risk management
Market risk is the risk that changes in market prices, such as
foreign exchange rates, interest rates and equity prices will
affect the Group's income or the value of its holdings of financial
instruments.
Market risk - Foreign currency risk
The Group has exposure to foreign currency risk arising from
trade and other payables which are denominated in foreign
currencies. The Group is not, however, exposed to any significant
transactional foreign currency risk. The Group's exposure to
foreign currency risk is as follows and is based on carrying
amounts for monetary financial instruments.
26. Financial instruments (continued)
Group
31 March 2017 Total Balance
EUR USD Other sheet exposure GBP Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cash and cash equivalents 264 163 25 452 14,627 15,079
Trade payables and
other payables (472) (128) (190) (790) (11,496) (12,286)
--------------------------- -------- -------- --------
Balance sheet exposure (208) 35 (165) (338) 3,131 2,793
-------- -------- --------
31 March 2016 Total Balance
EUR USD Other sheet exposure GBP Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cash and cash
equivalents 74 204 4 282 13,755 14,037
Trade payables and
other payables (173) (62) (69) (304) (10,940) (11,244)
-------------------- -------- -------- --------
Balance sheet
exposure (99) 142 (65) (22) 2,815 2,793
-------------------- -------- -------- --------
The Company has no exposure to foreign currency risk.
Sensitivity analysis
Group
A 10% weakening of the following currencies against pound
sterling at 31 March would have increased / (decreased) equity and
profit or loss by the amounts shown below. This calculation assumes
that the change occurred at the balance sheet date and had been
applied to risk exposures existing at that date. This analysis
assumes that all other variables, in particular other exchange
rates and interest rates remain constant and is performed on the
same basis for year ended 31 March 2016.
Equity Profit or Loss
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
EUR 21 10 21 10
USD (4) (14) (4) (14)
A 10% strengthening of the above currencies against pound
sterling at 31 March would have the equal but opposite effect on
the above currencies to the amounts shown above, on the basis that
all other variables remain constant.
Market risk - interest rate risk
At the balance sheet date the interest rate profile for the
Group's interest-bearing financial instruments was:
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Fixed rate financial instruments
Finance lease receivable 1,562 1,565 - -
Financial liabilities (969) - - -
Lease liabilities (5,011) (5,137) - -
(4,418) (3,572) - -
---------------------------------------
Variable rate financial instruments
Effect of Interest rate swap liability (71) (87) (71) (87)
Financial liabilities (2,859) (3,264) - -
(2,930) (3,351) (71) (87)
---------------------------------------
26. Financial instruments (continued)
At 31 March 2017, the group had four bank loans:
(i) GBP0.4 million (2016: GBP0.6 million) repayable over five
years, which has been secured against two vessels in Portsmouth.
Interest is payable on this loan at 2.8% over the Bank of England
base rate;
(ii) GBP2.0 million (2016: GBP2.2 million) repayable over ten
years, with interest charged at 2.6% above the bank of England base
rate; and
(iii) GBP0.4 million (2016: GBP0.5 million) repayable over ten
years, with interest charged at 1.75% above the Bank of England
base rate.
(iv) GBP1.0 million drawn down in December 2016 by Momart
Limited to fund the new storage facilities
The interest payable on the first three loans noted above has
been hedged by one interest swap, taken out in October 2015 with a
notional value of GBP3.6 million, with interest payable at the
difference between 1.325% and the Bank of England Base rate. This
interest rate swap notional value decreases at GBP36,250 per month
over five years until September 2020 when it will expire. The
notional value of the swap at 31 March 2017 is GBP3,008,750 (2016:
GBP3,443,750). The Swap effectively fixes the blended average
interest rates on the Group's bank borrowings at 3.6% per
annum.
Sensitivity analysis
An increase of 100 basis points in interest rates at the balance
sheet date would have increased / (decreased) equity and profit or
loss by the amounts shown below. This calculation assumes that the
change occurred at the balance sheet date and has been applied to
risk exposures existing at that date.
This analysis assumes that all other variables, in particular
foreign currency rates, remain constant and considers the effect of
financial instruments with variable interest rates and financial
instruments at fair value through profit or loss or
available-for-sale with fixed interest rates. The analysis is
performed on the same basis for 31 March 2016.
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Equity
Interest rate swap liability 30 34 30 34
Variable rate financial liabilities (28) (33) - -
Profit or Loss
Interest rate swap liability 30 34 30 34
Variable rate financial liabilities (28) (33) - -
Market risk - equity price risk
(v) Capital Management
The Group's objectives when managing capital, which comprises
equity and reserves at 31 March 2017 of GBP39,745,000 (2016:
GBP38,569,000) are to safeguard its ability to continue as a going
concern, so that it can continue to provide returns to shareholders
and benefits to our other stakeholders.
27. Operating leases
Non-cancellable operating lease rentals are payable as
follows:
Group
2017 2016
GBP'000 GBP'000
Less than one year 1,036 910
Between one and five years 3,861 3,785
More than five years 8,311 8,895
13,208 13,590
-------- --------
The Group leases three office premises and a number of storage
warehouses under operating leases. Office leases typically run for
a period of 3-10 years, with an option to renew the lease after
that date. Warehouse leases typically run for a period of 25 years,
with an option to renew the lease after that date.
During the year GBP1,050,000 was recognised as an expense in the
income statement of operating leases (2016: GBP921,000).
The Company had no operating lease commitments.
28. Capital commitments
At 31 March 2017, the group had had no outstanding contractual
commitments for capital expenditure.
At 31 March 2016, the group had entered into contractual
commitments of GBP412,000, including GBP345,000 for the Momart
storage facility expansion at Unit 14 in Leyton, GBP32,000 for a
truck at Momart and GBP35,000 for the pontoon refurbishment at
Portsea.
29. Related parties
The Group has a related party relationship with its subsidiaries
(see note 14) and with its directors and executive officers.
Directors of the Company and their immediate relatives
controlled 25.73% (2016: 23.4%) of the voting shares of the Company
at 31 March 2017. However on 2 May 2017, Blackfish Capital Alpha
Fund SPC and Staunton Holdings Limited sold all their shareholdings
to The Article 6 Marital Trust, therefore Edmund Rowland no longer
has any beneficial interest in the shares of FIH group plc.
The compensation of key management personnel (including
Directors) is as follows:
Group Company
2017 2016 2017 2016
GBP'000 GBP'000 GBP'000 GBP'000
Key management emoluments including social security costs 1,147 1,194 370 382
Termination payments, including social security costs - 146 - -
Company contributions to defined contribution pension plans 76 82 - -
Share-related awards 34 52 34 39
-------- --------
Total key management personnel compensation 1,257 1,474 404 421
-------- --------
During the year ended 31 March 2017, the Group's joint venture,
SAtCO, made a loan of GBP200,000 to each of its parent companies.
This GBP200,000 loan was still payable by the Group at 31 March
2017.
All staff involved in construction activities were contracted
directly from parent companies FIC and Trant Construction and at 31
March 2017 and 2016 SAtCO had no permanent employees.
30. Accounting estimates and judgements
The preparation of financial statements in conformity with
adopted IFRS requires management to make judgements, estimates and
assumptions that effect the application of policies and reported
amounts of assets and liabilities, income and expenses. The
estimates and associated assumptions are based upon historical
experience and various other factors that are believed to be
reasonable under the circumstances, the results of which form the
basis of the judgements as to asset and liability carrying values
which are not readily apparent from other sources. Actual results
may vary from these estimates, and are taken into account in
periodic reviews of the application of such estimates and
assumptions.
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 revision and future periods if the
revision affects both current and future periods.
Actuarial assumptions have been used to value the defined
benefit pension liability (see note 23). Management have selected
these assumptions from a range of possible options following
consultations with independent actuarial advisors.
Impairment tests have been undertaken with respect to intangible
assets (see note 11 for further details) using commercial judgement
and a number of assumptions and estimates have been made to support
their carrying amounts. In determining the fair value of intangible
assets recognised on the acquisition of Momart International
Limited management acted after consultation with independent
intangible asset valuation advisors.
Directors and Corporate Information
Directors Registered Office
John Foster, Chief Executive Kenburgh Court,
Jeremy Brade, Interim Chairman & Non-executive Director 133-137 South Street,
Edmund Rowland, Non-executive Director Bishop's Stortford,
Hertfordshire CM23 3HX
Company Secretary T: 01279 461630
Carol Bishop F: 01279 461631
E: admin@fihplc.com
W: www.fihplc.com
Registered number 03416346
Corporate Information
Stockbroker and Nominated Adviser
W.H. Ireland Limited
24 Martin Lane,
London EC4R 0DR
Solicitors
Bircham Dyson Bell LLP
50 Broadway,
Westminster,
London SW1H 0BL
Auditor
KPMG LLP
St. Nicholas House, 31 Park Row,
Nottingham NG1 6FQ
Registrar
Capita Asset Services
The Registry, 34 Beckenham Road,
Beckenham,
Kent BR3 4TU
Financial PR
FTI Consulting
200 Aldersgate
London EC1A 4HD
The Falkland Islands Company The Portsmouth Harbour Ferry Company Momart Limited
Kevin Ironside: Director Clive Lane: Director Kenneth Burgon: Director
Telephone: 00 500 27600 Telephone: 02392 524551 Alan Sloan Director
Email: fic@horizon.co.fk Email: admin@gosportferry.co.uk Telephone: 020 7426 3000
Website: www.the-falkland-islands-co.com Website: www.gosportferry.co.uk Email: enquiries@momart.co.uk
Website: www.momart.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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