TIDMNWF
RNS Number : 3117H
NWF Group PLC
03 August 2021
For release 7.00am Tuesday 3 August 2021
NWF Group plc
NWF Group plc: Final results for the year ended 31 May 2021
"Another strong set of results, ahead of expectations set before
the pandemic, demonstrating continued performance delivery and
resilience."
NWF Group plc ('NWF' or 'the Group'), the specialist distributor
of fuel, food and feed across the UK, today announces its audited
final results for the year ended 31 May 2021.
2021 2020 %
----------------------------------------------------- --------- --------- ------
Financial highlights
Revenue GBP675.6m GBP687.5m -1.7%
Headline operating profit1 GBP12.9m GBP14.3m -9.8%
Headline profit before taxation1 GBP11.9m GBP13.2m -9.8%
Fully diluted headline earnings per share1 20.4p 21.3p -4.2%
Total dividend per share 7.2p 6.9p +4.3%
Net debt (excluding IFRS 16 lease liabilities) GBP5.7m GBP12.3m -53.7%
Net debt to headline EBITDA (excluding IFRS 16 lease
liabilities)2 0.3x 0.7x +0.4x
----------------------------------------------------- --------- --------- ------
Statutory results
Operating profit GBP12.1m GBP13.5m -10.4%
Profit before taxation GBP10.8m GBP12.0m -10.0%
Fully diluted earnings per share 15.9p 18.1p -12.2%
Net debt (including IFRS 16 lease liabilities) GBP31.3m GBP38.6m -18.9%
----------------------------------------------------- --------- --------- ------
1 Headline operating profit excludes exceptional items (see note
5) and amortisation of acquired intangibles. Headline profit before
taxation excludes exceptional items, amortisation of acquired
intangibles and the net finance cost in respect of the Group's
defined benefit pension scheme. The calculation of headline
earnings excludes the exceptional impact of remeasuring deferred
tax balances. Headline EPS for the year ended 31 May 2020 has been
re-presented on a like-for-like basis (see note 8). Diluted
headline earnings per share also take into account the taxation
effect thereon.
2 Net debt to headline EBITDA is calculated based on net debt
excluding IFRS 16 lease liabilities. The headline EBITDA
calculation excludes the impact of IFRS 16 depreciation.
Highlights:
-- Performance ahead of the market expectations established
pre-pandemic. Second highest profit performance on record for the
Group; prior year benefitted from a significant fall in the oil
price.
-- Outperformance in Fuels with strong heating oil demand
supported by a cold winter and an increase in home working during
the pandemic.
-- Strong second half recovery in Food delivering on the
anticipated benefits of the new Crewe warehouse, which has been
fully utilised.
-- Feeds performance impacted by the significant increase in
feed commodity prices and reduced management information as a
result of the cyber incident.
-- Continued effective response to Covid-19:
-- All divisions have remained open and operational, providing essential services.
-- Continually updated risk assessments across the Group,
enabling safe working and meeting customer needs.
-- No Government support utilised and no staff furloughed.
-- Balance sheet remains in a strong position with net debt to
headline EBITDA at 0.3x, highlighting the resilience of the Group
and providing significant capacity to support investment driven
growth.
-- For the tenth successive year, it is proposed to increase the
total dividend, by 4.3% to 7.2p per share, reflecting the Board's
confidence in prospects of the business.
-- Performance to date in the current financial year has been in
line with the Board's expectations.
Divisional highlights:
Fuels - headline operating profit of GBP9.3 million (2020:
GBP11.0 million). Strong performance, ahead of expectations and
against the prior year which benefitted from significant oil price
volatility. Continued effective commercial and operational
execution across the depot network, with strong gas and heating oil
sales driving further mix improvement.
Food - headline operating profit of GBP1.9 million (2020: GBP1.4
million). Good second half recovery after volatile trading
conditions in H1 as a result of Brexit and pandemic buying
patterns. The new Crewe warehouse has been fully utilised and has
delivered business benefits in line with expectations. Efficiency
improvements have delivered the sustained profit improvement.
Feeds - headline operating profit of GBP1.7 million (2020:
GBP1.9 million). Continued to support farming customers across the
country with nutritional advice and on time deliveries. Performance
was impacted by unprecedented commodity price increases during key
winter months, exacerbated by a lack of visibility as a result of
the cyber incident.
Richard Whiting, Chief Executive, NWF Group plc, commented:
"NWF has delivered another strong set of results, ahead of
expectations set before the pandemic, demonstrating continued
performance, delivery and resilience. Our teams have worked hard
during the year meeting customers' needs whilst staying safe. I'm
proud of how we have responded to the challenges of Covid-19,
Brexit and a cyber incident and exited the year strongly, with
significant financial capacity and a clear growth strategy.
There is a significant opportunity for growth backed by strong
cash flows and flexible banking facilities alongside a strong asset
base. We will therefore continue to consider acquisition
opportunities, building on our successful track record of acquiring
and integrating businesses, as well as investment in organic
development.
Performance to date in the current financial year has been in
line with the Board's expectations. Overall, the Board continues to
remain confident about the Group's future prospects."
A virtual meeting is being held today for analysts at 11.00 a.m.
For login details please contact ailsa.prestige@mhpc.com at MHP
Communications.
Information for investors, including analyst consensus
forecasts, can be found on the Group's website at
www.nwf.co.uk.
Richard Whiting, Chief Reg Hoare / James Bavister
Executive / Mike Bell / Ed Allsopp
Chris Belsham, Group Finance
Director Ailsa Prestige
NWF Group plc MHP Communications Peel Hunt LLP
(Nominated Advisor)
Tel: 01829 260 260 Tel: 020 3128 8734 Tel: 020 7418 8900
Chair's statement
Overview
I am pleased to report another year of outperformance for the
Group, exceeding the market expectations that were established
before the pandemic. I am proud of the response of all our
employees to the Covid-19 pandemic and would like to thank them for
their ongoing efforts during this difficult time. The resilience
and capability of the Group has been highlighted in the positive
response to the challenges of Covid-19, Brexit uncertainty and the
cyber incident experienced by the Group in the first half. I am
also pleased to report that NWF has not utilised any form of
Government support, furloughed any employees or delayed payments at
any stage of the pandemic.
As a consequence of the good progress achieved, the Group's cash
generation, and its confidence in the Group's future prospects, the
Board is recommending a final dividend of 6.2p per share, to be
paid to shareholders on 10 December 2021 (2020: 5.9p) giving a
total dividend of 7.2p per share (2020: 6.9p), a 4.3% increase on
the prior year. This is the tenth year that the Group has increased
the dividend, highlighting continual sustained improvements in
performance.
Our business
NWF Group is a specialist distributor delivering fuel, food and
feed across the UK. Each of our trading divisions has scale and
good market position and is profitable and cash generative. Each
division trades under different brands with their own brand
architecture as follows:
Fuels NWF Fuels (including a number of local sub-brands)
Food Boughey
Feeds NWF Agriculture, SC Feeds, New Breed and Jim Peet
Key areas of focus for the Board in 2021 were:
Responding proactively to market conditions
The Group has responded well to volatile market conditions
throughout the year. The demand for fuel was a little subdued in H1
as consumers had stocked up in the prior year. This was then offset
by strong demand through cold winter months and home working and a
continued focus on gas oil sales across our 25 depots. In Food
there was significant volatility in H1 with retailers and consumers
creating demand uncertainty in response to concerns around Covid-19
and potential impacts and scenarios around Brexit. This demand
profile then stabilised in the second half allowing the business to
drive efficiency in operations across our sites and improve
performance. In Feeds the overall ruminant market grew, driven
principally by increased demand for sheep and beef feed where NWF
has a smaller share given our focus on dairy.
Delivering on strategy
The Group has been executing a successful acquisition strategy,
focused on the Fuel business, which was paused through the peak
uncertainty created by the pandemic before activity recommenced in
the autumn. Whilst no businesses have been acquired in the year
activity in building our pipeline has taken place, albeit limited
by lockdowns and lack of face-to-face meetings. The acquisitions
completed in prior years in aggregate have performed in line with
expectations and further integration planning work has been
completed to support future activity. The significant expansion of
the Food business with the full utilisation of the new 240,000ft(2)
warehouse in Crewe has significantly increased the scale of
activities. The NWF Academy in Feeds is now back in full operation
with a third cohort being recruited for the autumn, with training
having been undertaken virtually for much of the year.
Cash generation
Cash generation remains a focus for the Group and net debt has
been further reduced to 0.3x headline EBITDA as strong cash
performances have been delivered across the Group and capex was a
little lower than anticipated.
Rewarding good service
The consistent focus on excellence in customer service across
the Group has been critical to our continued development with safe
working practices and significant home working across the
Group.
Commodity volatility
Volatility in oil and feed commodity prices continued to be
significant and the businesses managed this effectively. In Fuels,
the price of oil (which is purchased on the spot market) moved from
a low point of $38 per barrel to end the year at $70 per barrel for
Brent Crude. In line with market practice, Feeds buys most of its
raw materials under forward purchase contracts. Feed input
commodities increased to unprecedented levels with a basket of spot
commodities peaking at over 40% higher than at the start of the
year.
ESG framework
The Board recognises the importance of ESG and has established
four pillars of strategic focus. During the year investing in our
people has been a priority to ensure safe working whilst
maintaining great service to all our customers across the country.
We will report on a number of initiatives and areas of focus in the
Annual Report. We continue to adopt the Quoted Companies Alliance
Corporate Governance Code ('the QCA Code') which we believe has
been constructed in a simple, practical and effective style and
that meaningful compliance with its ten main principles should
provide shareholders with confidence in how the Group operates.
Employees
The Group now employs in excess of 1,200 people across the three
divisions and Head Office. I would like to offer my personal thanks
to all of our employees for their outstanding efforts and
commitment to the Group during these challenging times.
I look forward to updating shareholders on the Group's
continuing progress at the time of the Annual General Meeting on 30
September 2021.
Philip Acton
Chair
3 August 2021
Business and financial review
NWF has delivered another strong set of results, ahead of
expectations set before the pandemic, demonstrating continued
performance delivery and resilience. Our teams have worked hard
during the year meeting customers' needs whilst staying safe. We
have responded to the challenges of Covid-19, Brexit and a cyber
incident and exited the year strongly, with significant financial
capacity and a clear growth strategy.
An effective focus on cash continues and the second highest
profit in the Group's history has been converted into cash
maintaining significant headroom and a low level of leverage which
provides significant scope to fund development activity across the
Group. We are proposing an increased dividend, demonstrating the
Board's continued confidence in the prospects of the Group, and
have a number of strategic development opportunities which we
continue to review.
Fuels has delivered a good result, with a solid performance
across our depot network and an improvement in product mix as a
consequence of clear sales focus and the business benefitting from
a cold winter and customers moving to home working during the
pandemic.
The Food division experienced a year of very different halves.
In H1 significant demand volatility as a consequence of Covid-19
and Brexit caused disruption and inefficiency which was reversed in
H2 when efficiency and profitability increased significantly. The
new 240,000ft(2) Crewe warehouse was fully utilised and is
delivering on its investment case.
Feeds continued to focus on nutritional advice to farmers across
the country and was negatively impacted by the unprecedented
increases in commodity prices in the key winter months and a lack
of visibility during a cyber incident. This incident at the end of
October prompted the Group to instigate its cyber response plan,
backed by a bespoke cyber insurance policy; the incident was
contained satisfactorily and additional security measures were
applied to all of the Group's IT systems.
The Group delivered headline operating profit of GBP12.9 million
(2020: GBP14.3 million) and headline profit before tax was 9.8%
lower than the record prior year at GBP11.9 million (2020: GBP13.2
million). Operating profit was GBP12.1 million (2020: GBP13.5
million). Diluted headline earnings per share were 4.2% lower at
20.4p (2020: 21.3p)[1].
Cash management remains strong with net debt of GBP5.7 million
(2020: GBP12.3 million) excluding lease liabilities, representing
0.3x headline EBITDA, after GBP3.0 million of net capital
expenditure which was a little lower than normal.
Fuels
Fuels' strong performance was as a consequence of a commercial
focus on gas oil and solid demand for heating oil across all depots
as a result of a cold winter and increased home working during
lockdowns by domestic customers. The extended winter period
supported margins stronger than anticipated which more than offset
any lower commercial activity from the impact of Covid-19.
Volumes rose 4.5% to 695 million litres (2020: 665 million
litres); however, revenue decreased by 4.8% to GBP447.8 million
(2020: GBP470.2 million) due to a change in sales mix, and lower
average oil prices offsetting the volume growth. On a like-for-like
basis (excluding the impact of acquisitions) volumes were stable.
The average Brent Crude oil price in the year was $52 per barrel
compared to $54 per barrel in the prior year. Oil started the year
at $38 per barrel and ended the year at $70 per barrel with periods
of slow increase the most challenging and where volatility supports
performance.
Headline operating profit was GBP9.3 million (2020: GBP11.0
million) benefitting from increased volumes, positive product mix
and improved margins across the year. Net profits of 1.4 pence per
litre are higher than the long-term average of 1.0 pence per litre
highlighting some one-off gains but also the improved product mix
with robust demand for heating oil and gas oil sales. The prior
year record result benefitted from a dramatic fall in the price of
oil and a significant demand increase at the start of the pandemic,
delivering a net profit of 1.6 pence per litre.
Acquisition activity was paused at the start of the pandemic
with the Board agreeing to restart in the autumn. Whilst good
progress has been made in developing the pipeline, no acquisitions
were completed in the year and the physical restrictions in place
through lockdowns reduced progress. There are still significant
opportunities to consolidate the fuels market and the business is
continuing to build its pipeline and assess potential targets
across the country.
The Fuels division operates on a de-centralised model with depot
management teams focused on optimising performance for the specific
conditions of their local market. This model supported our ability
to respond swiftly and effectively to the increased consumer demand
and significant commodity price volatility experienced during
lockdown. We continue to believe that our model is the most
effective way to maximise performance, given the industry
structure, but we also believe there are opportunities to leverage
benefits from the breadth of our growing network. As such we
continue to invest in enhancing systems and capabilities for the
Fuels division which we believe will improve efficiencies and
provide a strong platform for continued growth.
With over 127,000 customers (2020: 116,000) being supplied
across 25 fuel depots in the year (2020: 25), Fuels operates in
large and robust markets and, as a business, it has consistently
proved it can effectively manage the impact of volatility in oil
prices. The industry remains highly fragmented, with many small
operators, which provides NWF with further opportunities to
consolidate the market and increase share.
Food
A solid overall performance has been achieved with
underperformance in H1 offset by a result ahead of expectation in
H2. Significant trading volatility was experienced in H1 as a
result of atypical Covid-19 demand patterns from consumers and
retailers, compounded by uncertainty around Brexit, which together
led to business inefficiencies. With stock in the optimum locations
in H2 and more normal demand levels, combined with a significant
efficiency improvement backed by the new Crewe warehouse,
profitability markedly improved.
Revenue increased by 13.5% to GBP54.8 million (2020: GBP48.3
million). Storage overall was at an average of 120,000 pallets
(2020: 103,000 pallets), as the Crewe facility came fully on stream
and no external warehousing was utilised. Pallets despatched
increased by 13% on the prior year, reflecting the increased
activity of new customer contracts. The mix was somewhat adverse as
a result of lower activity for food service and cash and carry
outlets where complex distribution activity generates higher value
work.
Headline operating profit was GBP1.9 million (2020: GBP1.4
million). Demand increased for e-fulfilment services and, whilst a
small contribution was made, the growth of the business was offset
by continued investment in training and expansion of facilities.
The Palletline operation exceeded expectations and a solid
performance was delivered by the repacking operation at Wardle.
The new Crewe 240,000ft(2) warehouse was fully utilised in the
year, with new and existing customers, with storage at an average
of over 26,000 pallets out of a capacity of 35,000 spaces, and is
90% utilised at year end, performing in line with our expectations.
This operation focuses on full pallet, full load activities with
more complex added value operations being completed in the Wardle
facility.
Demand for our customers' products continues to be stable and
the outlook for most product categories handled by the business is
resilient. The business operates in a competitive supply chain and
needs to continually demonstrate the value and service that it
provides to food manufacturers and importers. The business has a
leading position in consolidating ambient grocery products in the
North West, with high service levels, industry leading systems and
a strong operating performance being the key components of its
customer proposition.
Feeds
Feeds is focused on providing nutritional advice and on time
deliveries to farmers across the country. Total feed volume
decreased by 8.0% to 575,000 tonnes (2020: 625,000 tonnes). Total
ruminant feed market volumes were 4.7% higher than prior year with
most gains in sheep and beef feed and a small market decline in
core dairy compounds. Less volume was sold to other compounders and
merchants in the year as planned.
Commodity prices increased sharply in the winter to
unprecedented levels with peak spot commodity prices an average of
40% higher than summer levels which created challenges for the
business in managing prices. This was exacerbated by a lack of data
visibility as a result of the cyber incident at the end of October
2020. Price increases were implemented but were chasing ever higher
commodity costs.
Revenue was higher at GBP173.0 million (2020: GBP169.0 million)
reflecting the higher feed prices in the year. Headline operating
profit was GBP1.7 million (2020: GBP1.9 million).
Feeds launched the NWF Academy in September 2019 in which new
trainees engage on an 18-month structured training programme to
become future NWF nutritionists. The Academy has recruited a second
group to the programme which has been well received across the
industry, and although work was transferred to a virtual classroom
in 2021, a third cohort is being recruited to commence the
programme in September 2021 in person.
Average milk prices in the UK were positive, with a 2021 average
price of 29.3p per litre compared to an average in the prior year
of 28.6p per litre. The price in May 2021 of 30.1p per litre
compares to 26.7p per litre in May 2020 maintaining farmers'
returns in spite of higher feed costs at the end of the year. Milk
production increased marginally to 12.6 billion litres (2020: 12.5
billion litres).
Feeds has a very broad customer base, working with over 4,550
farmers across the country. This base, and the underlying robust
demand for milk and dairy products, results in a reasonably stable
overall demand for our feed in most market conditions.
Outlook
In Fuels we have a proven depot-based operating model and a
clear growth strategy to add to the network with acquisitions.
These are being actively pursued and the opportunity for growth
remains significant.
In Food we continue to seek improvement opportunities to
continue the progress made in the second half of 2021 and have
sufficient contracted business to continue to build on our
performance utilising the Wardle and Crewe sites. We do not
anticipate the significant volatility events that marked the year
to December 2020.
In Feeds, with commodity prices stabilising and a good milk
price, demand is anticipated to remain solid and we will look to
increase business on the back of continued developments from the
Academy and others joining the sales team of a progressive national
feed business.
The Group has clearly demonstrated its capability to deliver
performance and has great resilience. There is a significant
opportunity for growth backed by strong cash flows and flexible
banking facilities alongside a strong asset base. We will therefore
continue to consider acquisition opportunities, building on our
successful track record of acquiring and integrating businesses, as
well as investment in organic development.
Performance to date in the current financial year has been in
line with the Board's expectations. Overall, the Board continues to
remain confident about the Group's future prospects.
Group results
For the year ended 31 May
2021 2020
GBPm GBPm
------------------------------------------------------- ------- -------
Revenue 675.6 687.5
Cost of sales and administrative expenses (663.5) (674.0)
------------------------------------------------------- ------- -------
Headline operating profit(1) 12.9 14.3
Exceptional items (0.5) (0.5)
Amortisation of acquired intangibles (0.3) (0.3)
------------------------------------------------------- ------- -------
Operating profit 12.1 13.5
Financing costs (1.3) (1.5)
------------------------------------------------------- ------- -------
Headline profit before tax(1) 11.9 13.2
Exceptional items (0.5) (0.5)
Amortisation of acquired intangibles (0.3) (0.3)
Net finance cost in respect of defined benefit pension
scheme (0.3) (0.4)
------------------------------------------------------- ------- -------
Profit before taxation 10.8 12.0
Income tax expense(2) (3.0) (3.1)
------------------------------------------------------- ------- -------
Profit for the year 7.8 8.9
------------------------------------------------------- ------- -------
Headline EPS(1) 20.4p 21.5p
------------------------------------------------------- ------- -------
Diluted headline EPS(1) 20.4p 21.3p
------------------------------------------------------- ------- -------
Dividend per share 7.2p 6.9p
------------------------------------------------------- ------- -------
Headline dividend cover(1) 2.8 2.9
------------------------------------------------------- ------- -------
Headline interest cover 25.8 20.4
------------------------------------------------------- ------- -------
1 Headline operating profit is statutory operating profit of
GBP12.1 million (2020: GBP13.5 million) before exceptional items of
GBP0.5 million (2020: GBP0.5 million) and amortisation of acquired
intangibles of GBP0.3 million (2020: GBP0.3 million). Headline
profit before taxation is statutory profit before taxation of
GBP10.8 million (2020: GBP12.0 million) after adding back the net
finance cost in respect of the Group's defined benefit pension
scheme of GBP0.3 million (2020: GBP0.4 million), the exceptional
items and amortisation of acquired intangibles. The calculation of
headline earnings excludes the exceptional impact of remeasuring
deferred tax balances. Headline EPS for the year ended 31 May 2020
has been re-presented on a like-for-like basis. Headline EPS also
takes into account the taxation effect thereon. Headline dividend
cover is calculated using diluted headline EPS.
2 Taxation on exceptional items in the current period has
reduced the charge by GBP0.1 million (2020: GBPNil).
Group revenue decreased by 1.7% to GBP675.6 million (2020:
GBP687.5 million) with higher activity levels and a full year of
revenue from acquisitions largely offset by the impact of the lower
average oil price across the year. Headline operating profit was
GBP12.9 million, a decrease of 9.8% (2020: GBP14.3 million).
Operating profit decreased 10.4% to GBP12.1 million (2020: GBP13.5
million).
Financing costs (excluding those in respect of the defined
benefit pension scheme) decreased by GBP0.1 million to GBP1.0
million. The interest on bank debt was GBP0.5 million (2020: GBP0.7
million) and headline interest cover was 25.8x (excluding IAS 19
net pension finance costs and IFRS 16 lease interest) (2020:
20.4x).
Headline profit before taxation decreased by 9.8% to GBP11.9
million (2020: GBP13.2 million). Profit before taxation decreased
by GBP1.2 million to GBP10.8 million (2020: GBP12.0 million). There
were net exceptional items in the year of GBP0.5 million relating
to the cyber incident and acquisition-related costs (2020: GBP0.5
million).
The tax charge for the year was GBP3.0 million (2020: GBP3.1
million) which included an increase in the deferred tax liability
of the Group arising from the Finance Bill 2021 which was
substantively enacted on 24 May 2021, resulting in deferred tax
balances being remeasured from 19% to 25%. This resulted in an
additional tax charge of GBP1.3 million (2020: GBP0.5 million).
Excluding the impact of the deferred tax increase the effective
underlying tax rate for the year was 19.4% (2020: 21.7%). The
post-tax profit for the year was GBP7.8 million (2020: GBP8.9
million).
The headline earnings per share of 20.4p represented a decrease
of 5.1% (2020: 21.5p); diluted headline earnings per share
decreased by 4.2% to 20.4p (2020: 21.3p). The proposed full year
dividend per share increased by 4.3% to 7.2p which reflects the
Board's confidence in the Group, its strong underlying cash
generation and its future prospects. The proposed dividend equates
to a dividend cover ratio of 2.8x.
The finance costs in respect of the defined benefit pension
scheme were GBP0.3 million (2020: GBP0.4 million).
Balance sheet summary
As at 31 May
2021 2020
GBPm GBPm
----------------------------------------------- ------ ------
Tangible and intangible fixed assets 78.2 79.9
Right of use assets 25.4 27.3
Net working capital 3.5 4.8
Derivative financial instruments 0.1 0.1
Net debt (excluding IFRS 16 lease liabilities) (5.7) (12.3)
Lease liabilities (25.6) (26.3)
Current tax assets/(liabilities) 0.4 (0.9)
Deferred tax liabilities (net) (1.9) (0.5)
Retirement benefit obligations (14.9) (21.0)
----------------------------------------------- ------ ------
Net assets 59.5 51.1
----------------------------------------------- ------ ------
The Group increased net assets by GBP8.4 million to GBP59.5
million (31 May 2020: GBP51.1 million). This reflects the robust
trading performance during the year with a profit for the year of
GBP7.8 million (2020: GBP8.9 million) and the reduction in the IAS
19 deficit on the defined benefit pension scheme.
Tangible and intangible fixed assets decreased by GBP1.7 million
to GBP78.2 million as at 31 May 2021 (31 May 2020: GBP79.9 million)
largely as depreciation charges were in excess of capital spend.
The depreciation (excluding IFRS 16 depreciation on right of use
assets) and amortisation charges for the year to 31 May 2021 were
GBP4.5 million and GBP0.7 million respectively (2020: GBP4.1
million and GBP0.6 million respectively).
Group level ROCE (based on headline operating profit) is 15.8%
as at 31 May 2021 (31 May 2020: 16.7%).
Net working capital decreased by GBP1.3 million in the year as
the Group benefitted from some short-term timing benefits at the
year end. The Group's inventories increased by GBP1.9 million to
GBP6.6 million (31 May 2020: GBP4.7 million) with trade and other
receivables increasing to GBP72.1 million (31 May 2020: GBP56.7
million) and an increase in trade and other payables to GBP75.2
million (31 May 2020: GBP56.6 million).
Net debt (excluding lease liabilities) decreased by GBP6.6
million to GBP5.7 million (31 May 2020: GBP12.3 million), as a
result of capital expenditure being lower than planned, ongoing
disciplined cash management and a strong trading performance. At
the year end, the Group's net debt to headline EBITDA ratio was
0.3x (2020: 0.7x).
The deficit of the Group's defined benefit pension scheme
decreased by GBP6.1 million to GBP14.9 million (31 May 2020:
GBP21.0 million). The value of pension scheme assets increased by
GBP5.0 million to GBP45.1 million (31 May 2020: GBP40.1 million) as
a result of employer contributions and actuarial gains on plan
assets. The value of the scheme liabilities decreased by GBP1.1
million to GBP60.0 million (31 May 2020: GBP61.1 million) largely
as a result of changes actuarial assumptions, and an increase in
the discount rate used to calculate the present value of the future
obligations (31 May 2021: 2.00%; 31 May 2020: 1.65%).
Cash flow and banking facilities
For the year ended 31 May
2021 2020
GBPm GBPm
--------------------------------------------------------------- ------ ------
Operating cash flows before movements in working capital
and provisions 22.4 23.8
Working capital movements 2.4 1.7
Interest paid (1.0) (1.1)
Tax paid (2.8) (2.7)
--------------------------------------------------------------- ------ ------
Net cash generated from operating activities 21.0 21.7
--------------------------------------------------------------- ------ ------
Capital expenditure (net of receipts from disposals) (3.0) (5.7)
Acquisition of subsidiaries - cash paid (net of cash acquired) (1.1) (6.0)
Capitalised legal costs associated with leases - (0.3)
--------------------------------------------------------------- ------ ------
Net cash used in investing activities (4.1) (12.0)
--------------------------------------------------------------- ------ ------
Net (decrease)/increase in bank borrowings (7.7) 1.6
Capital element of leases (7.1) (5.6)
Dividends paid (3.4) (3.2)
--------------------------------------------------------------- ------ ------
Net cash used in financing activities (18.2) (7.2)
--------------------------------------------------------------- ------ ------
Net (decrease)/increase in cash and cash equivalents (1.3) 2.5
Cash and cash equivalents at beginning of year 5.3 2.8
--------------------------------------------------------------- ------ ------
Cash and cash equivalents at end of year 4.0 5.3
--------------------------------------------------------------- ------ ------
During the year the final balance of GBP1.1 million was paid for
the acquisition of Ron Darch & Sons Co Limited, following
finalisation of the completion accounts. The closing net debt
(excluding IFRS 16 lease liabilities) of GBP5.7 million represents
a net debt to headline EBITDA ratio of 0.3x (2020: 0.7x).
The cash impact of working capital movements was GBP2.4 million,
driven by strong cash collection and some supplier payments being
taken after the year end as a result of the timing of the bank
holiday. Net cash generated from operating activities and after
IFRS 16 lease payments was GBP13.9 million (2020: GBP16.1 million)
representing a cash conversion ratio of 107.8% of headline
operating profit (2020: 112.6%).
Net capital expenditure in the year at GBP3.0 million (2020:
GBP5.7 million) was lower than the annual depreciation charge,
excluding IFRS 16 depreciation, of GBP4.5 million (2020: GBP4.1
million).
The Group's banking facilities, totalling GBP65.0 million, were
renewed in June 2018 and are committed through to 31 October 2023
with the exception of the bank overdraft facility of GBP1.0 million
and the GBP4.0 million bank guarantee facility which are renewed
annually. There remains substantial facility headroom available to
support the development of the Group. Within the total facility of
GBP65.0 million, the Group has an invoice discounting facility, the
availability of which depends on the level of trade receivables
available for refinancing and which is subject to a maximum
drawdown of GBP50.0 million. The banking facilities are provided
subject to ongoing compliance with conventional banking covenants
against which the Group has substantial levels of headroom.
Principal risks and uncertainties
As with all businesses, the Group is affected by a number of
risks and uncertainties, some of which are beyond our control. The
principal risks and uncertainties which could have a material
adverse impact on the Group are:
-- Covid-19 pandemic - The global pandemic, Covid-19, presents a
number of different risks to the business. This is particularly the
case if there are continued waves of Covid-19 which result in
further nationwide lockdowns. Firstly, the pandemic poses a risk to
the health and safety of employees. Secondly, the impact of the
pandemic related restrictions on the UK economy and therefore
demand for the Group's products and services, particularly in the
Fuels division, is uncertain and can lead to volatility. In
addition, the response of the UK Government to the pandemic may
create restrictions on the Group's ability to operate.
-- Labour shortages following Brexit - In the aftermath of
Brexit, there is an increasing shortage of HGV drivers in the UK.
This could lead to significant wage inflation which all three
divisions will need to respond to and it may not be possible to
pass these additional costs on to customers. The shortage of
drivers will also reduce the availability of agency drivers and
subcontractors, making it more difficult to respond to fluctuations
in demand. Lastly a chronic shortage of drivers could hinder the
ability of the Group to operate at full capacity.
-- Commodity prices and volatility in raw material prices - The
Group's Feeds and Fuels divisions operate in sectors which are
vulnerable to volatile commodity prices both for fuel and for raw
materials.
-- Impact of climate on earnings volatility - The demand for
both the Feeds and Fuels divisions is impacted by weather
conditions and the severity of winter conditions, which directly
affect the demand for heating oil and animal feeds. The inherent
uncertainty regarding weather conditions represents a risk of
volatility in the profitability of the Fuels and Feeds
divisions.
-- Pension scheme volatility - Increases in the ongoing deficit
associated with the Group's defined benefit pension scheme would
adversely impact on the strength of the Group's balance sheet and
could lead to an increase in cash contributions payable by the
Group.
-- Recruitment, retention and development of key people -
Recruiting and retaining the right people is crucial for the
success of the Group and its development.
-- Infrastructure and IT systems - IT system failures or business interruption events (such as cyber-attacks) could have a material impact on the Group's ability to operate effectively.
-- Non-compliance with legislation and regulations - The Group
operates in diverse markets and each sector has its own regulatory
and compliance frameworks which require ongoing monitoring to
ensure that the Group maintains full compliance with all
legislative and regulatory requirements. Any incident of major
injury or fatality or which results in significant environmental
damage could result in reputational or financial damage to the
Group.
-- Strategic growth and change management - A failure to
identify, execute or integrate acquisitions, change management
programmes or other growth opportunities could impact on the
profitability and strategic development of the Group.
Further information on the Group's mitigating actions against
risks and uncertainties will be detailed in the Annual Report.
Going concern
The Group has an agreement with NatWest Group for credit
facilities totalling GBP65.0 million. With the exception of the
bank overdraft facility of GBP1.0 million and the GBP4.0 million
bank guarantee facility, which are renewed annually, these
facilities are committed through to 31 October 2023. As at 31 May
2021 the Group had available facilities of GBP52.3 million (based
on actual invoice discounting availability and overdraft
facilities), against which the Group was utilising GBP5.5
million.
The Board has prepared cash flow forecasts for the period to 31
May 2023. Under this base case scenario, the Group is expected to
continue to have significant headroom relative to the funding
available to it and to comply with its banking covenants.
The Board has also considered a severe downside scenario based
on a significant and sustained reduction in Fuels' profitability
alongside underperformance in Food and Feeds. This downside
scenario excludes any mitigating actions that the Board would be
able to take to reduce costs. Under this scenario, the Group would
still expect to have sufficient headroom in its financing
facilities.
Accordingly, the Directors, having made suitable enquiries, and
based on financial performance to date and forecasts along with the
available banking facilities, have a reasonable expectation that
the Group has adequate resources to continue in operational
existence for the foreseeable future. The Group therefore continues
to adopt the going concern basis of accounting in preparing the
annual financial statements.
Share price
The market price per share of the Company's shares at 31 May
2021 was 212.0p (31 May 2020: 201.0p) and the range of market
prices during the year was between 180.0p and 230.0p.
Richard Whiting Chris Belsham
Chief Executive Finance Director
Consolidated income statement
for the year ended 31 May 2021
2021 2020
Note GBPm GBPm
-------------------------------------------------------- ---- ------- -------
Revenue 4 675.6 687.5
Cost of sales (637.7) (646.2)
-------------------------------------------------------- ---- ------- -------
Gross profit 37.9 41.3
Administrative expenses (25.8) (27.8)
-------------------------------------------------------- ---- ------- -------
Headline operating profit(1) 12.9 14.3
Exceptional items 5 (0.5) (0.5)
Amortisation of acquired intangibles (0.3) (0.3)
-------------------------------------------------------- ---- ------- -------
Operating profit(3) 4 12.1 13.5
Finance costs 6 (1.3) (1.5)
-------------------------------------------------------- ---- ------- -------
Headline profit before taxation(1) 11.9 13.2
Net finance cost in respect of the defined benefit
pension scheme (0.3) (0.4)
Exceptional items 5 (0.5) (0.5)
Amortisation of acquired intangibles (0.3) (0.3)
-------------------------------------------------------- ---- ------- -------
Profit before taxation 10.8 12.0
Income tax expense(2) 7 (3.0) (3.1)
-------------------------------------------------------- ---- ------- -------
Profit for the year attributable to equity shareholders 7.8 8.9
-------------------------------------------------------- ---- ------- -------
Earnings per share (pence)
Basic 8 15.9 18.2
Diluted 8 15.9 18.1
-------------------------------------------------------- ---- ------- -------
Headline earnings per share (pence)(1)
Basic 8 20.4 21.5
Diluted 8 20.4 21.3
-------------------------------------------------------- ---- ------- -------
1 Headline operating profit is statutory operating profit of
GBP12.1 million (2020: GBP13.5 million) before exceptional items of
GBP0.5 million (2020: GBP0.5 million) and amortisation of acquired
intangibles of GBP0.3 million (2020: GBP0.3 million). Headline
profit before taxation is statutory profit before taxation of
GBP10.8 million (2020: GBP12.0 million) after adding back the net
finance cost in respect of the Group's defined benefit pension
scheme of GBP0.3 million (2020: GBP0.4 million), the exceptional
items and amortisation of acquired intangibles. The calculation of
headline earnings includes the exceptional impact of remeasuring
deferred tax balances (see note 8). Headline EPS for the year ended
31 May 2020 has been re-presented on a like-for-like basis.
Headline earnings per share also take into account the taxation
effect thereon.
2 Taxation on exceptional items in the current year has reduced
the charge by GBP0.1 million (2020: GBPNil).
The results relate to continuing operations.
Consolidated statement of comprehensive income
for the year ended 31 May 2021
2021 2020
GBPm GBPm
-------------------------------------------------------- ---- -----
Profit for the year attributable to equity shareholders 7.8 8.9
--------------------------------------------------------- ---- -----
Items that will never be reclassified to profit
or loss:
Remeasurement gain/(loss) on defined benefit pension
scheme 4.0 (4.0)
Tax on items that will never be reclassified to
profit or loss 0.1 1.1
--------------------------------------------------------- ---- -----
Total other comprehensive income/(expense) 4.1 (2.9)
--------------------------------------------------------- ---- -----
Total comprehensive income for the year 11.9 6.0
--------------------------------------------------------- ---- -----
Consolidated balance sheet
as at 31 May 2021
2020
2021 (Restated[2])
Note GBPm GBPm
--------------------------------- ---- ------- --------------
Non-current assets
Property, plant and equipment 47.3 48.5
Right of use assets 25.4 27.3
Intangible assets 30.9 31.4
103.6 107.2
--------------------------------- ---- ------- --------------
Current assets
Inventories 6.6 4.7
Trade and other receivables 72.1 56.7
Current income tax assets 0.4 -
Cash and cash equivalents 12 4.0 5.3
Derivative financial instruments 0.2 0.1
--------------------------------- ---- ------- --------------
83.3 66.8
--------------------------------- ---- ------- --------------
Total assets 186.9 174.0
--------------------------------- ---- ------- --------------
Current liabilities
Trade and other payables (75.2) (56.6)
Current income tax liabilities - (0.9)
Borrowings 12 (6.5) (7.2)
Lease liabilities (7.4) (6.4)
Derivative financial instruments (0.1) -
--------------------------------- ---- ------- --------------
(89.2) (71.1)
--------------------------------- ---- ------- --------------
Non-current liabilities
--------------------------------- ---- ------- --------------
Borrowings 12 (3.0) (10.0)
Lease liabilities (18.4) (20.3)
Deferred income tax liabilities (1.9) (0.5)
Retirement benefit obligations 13 (14.9) (21.0)
--------------------------------- ---- ------- --------------
(38.2) (51.8)
--------------------------------- ---- ------- --------------
Total liabilities (127.4) (122.9)
--------------------------------- ---- ------- --------------
Net assets 59.5 51.1
--------------------------------- ---- ------- --------------
Equity
Share capital 10 12.3 12.2
Share premium 0.9 0.9
Retained earnings 46.3 38.0
--------------------------------- ---- ------- --------------
Total equity 59.5 51.1
--------------------------------- ---- ------- --------------
Consolidated statement of changes in equity
for the year ended 31 May 2021
Share Share Retained Total
capital premium earnings equity
GBPm GBPm GBPm GBPm
------------------------------------------------ ------- ------- -------- ------
Balance at 1 June 2019 12.2 0.9 34.0 47.1
------------------------------------------------ ------- ------- -------- ------
Profit for the year - - 8.9 8.9
------------------------------------------------ ------- ------- -------- ------
Items that will never be reclassified to profit
or loss:
Actuarial loss on defined benefit pension
scheme - - (4.0) (4.0)
Tax on items that will never be reclassified
to profit or loss - - 1.1 1.1
------------------------------------------------ ------- ------- -------- ------
Total other comprehensive expense - - (2.9) (2.9)
------------------------------------------------ ------- ------- -------- ------
Total comprehensive income for the year - - 6.0 6.0
------------------------------------------------ ------- ------- -------- ------
Transactions with owners:
Dividends paid (note 9) - - (3.2) (3.2)
Credit to equity for equity-settled share-based
payments - - 1.2 1.2
------------------------------------------------ ------- ------- -------- ------
Total transactions with owners - - (2.0) (2.0)
------------------------------------------------ ------- ------- -------- ------
Balance at 31 May 2020 12.2 0.9 38.0 51.1
------------------------------------------------ ------- ------- -------- ------
Profit for the year - - 7.8 7.8
------------------------------------------------ ------- ------- -------- ------
Items that will never be reclassified to profit
or loss:
Actuarial gain on defined benefit pension
scheme - - 4.0 4.0
Tax on items that will never be reclassified
to profit or loss - - 0.1 0.1
------------------------------------------------ ------- ------- -------- ------
Total other comprehensive income - - 4.1 4.1
------------------------------------------------ ------- ------- -------- ------
Total comprehensive income for the year - - 11.9 11.9
------------------------------------------------ ------- ------- -------- ------
Transactions with owners:
Issue of shares 0.1 - (0.1) -
Dividends paid (note 9) - - (3.4) (3.4)
Value of employee services - - (0.5) (0.5)
Credit to equity for equity-settled share-based
payments - - 0.4 0.4
------------------------------------------------ ------- ------- -------- ------
Total transactions with owners 0.1 - (3.6) (3.5)
------------------------------------------------ ------- ------- -------- ------
Balance at 31 May 2021 12.3 0.9 46.3 59.5
------------------------------------------------ ------- ------- -------- ------
Consolidated cash flow statement
for the year ended 31 May 2021
2021 2020
GBPm GBPm
----------------------------------------------------- ------ ------
Cash flows from operating activities
Operating profit 12.1 13.5
Adjustments for:
Depreciation and amortisation 12.9 10.5
Profit on disposal of fixed assets - (0.2)
Share-based payment expense 0.4 1.2
Value of employee services (0.5) -
Fair value (profit)/loss on financial derivatives (0.1) 0.1
Contribution to pension scheme not recognised in
income statement (2.4) (1.3)
------------------------------------------------------ ------ ------
Operating cash flows before movements in working
capital and provisions 22.4 23.8
Movements in working capital:
(Increase)/decrease in inventories (1.9) 1.9
(Increase)/decrease in receivables (15.3) 20.2
Increase/(decrease) in payables 19.6 (20.4)
------------------------------------------------------ ------ ------
Net cash generated from operations 24.8 25.5
Interest paid (1.0) (1.1)
Income tax paid (2.8) (2.7)
------------------------------------------------------ ------ ------
Net cash generated from operating activities 21.0 21.7
------------------------------------------------------ ------ ------
Cash flows used in investing activities
Purchase of intangible assets (0.1) (0.4)
Purchase of property, plant and equipment (2.9) (5.7)
Acquisition of subsidiaries - cash paid (net of
cash acquired) (1.1) (6.0)
Capitalised legal costs associated with acquired
leases - (0.3)
Proceeds on sale of property, plant and equipment - 0.4
------------------------------------------------------ ------ ------
Net cash used in investing activities (4.1) (12.0)
------------------------------------------------------ ------ ------
Cash flows used in financing activities
(Decrease)/increase in bank borrowings (7.7) 1.6
Capital element of finance leases (7.1) (5.6)
Dividends paid (3.4) (3.2)
------------------------------------------------------ ------ ------
Net cash used in financing activities (18.2) (7.2)
------------------------------------------------------ ------ ------
Net (decrease)/increase in cash and cash equivalents (1.3) 2.5
Cash and cash equivalents at beginning of year 5.3 2.8
------------------------------------------------------ ------ ------
Cash and cash equivalents at end of year 4.0 5.3
------------------------------------------------------ ------ ------
Notes to the Group financial statements
for the year ended 31 May 2021
1. General information
NWF Group plc ('the Company') is a public limited company
incorporated and domiciled in England, United Kingdom, under the
Companies Act 2006. The principal activities of NWF Group plc and
its subsidiaries (together 'the Group') are the sale and
distribution of fuel oils, the warehousing and distribution of
ambient groceries and the manufacture and sale of animal feeds.
Further information on the nature of the Group's operations and
principal activities is set out in the Group financial
statements.
The address of the Company's registered office is NWF Group plc,
Wardle, Nantwich, Cheshire CW5 6BP. The Company has its primary
listing on AIM, part of the London Stock Exchange.
2. Significant accounting policies
The Group's principal accounting policies are set out below.
Basis of preparation
The Group financial statements have been prepared in accordance
with International Financial Reporting Standards adopted pursuant
to Regulation (EC) No 1606/2002 as it applies in the European
Union, with the interpretations issued by the IFRS Interpretations
Committee (IFRS IC) of the IASB and with those parts of the
Companies Act 2006 applicable to companies reporting under IFRS.
The Group financial statements have been prepared on the going
concern basis and on the historical cost convention modified for
the revaluation of certain financial instruments.
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates, which
are outlined in note 14 below. It also requires management to
exercise its judgement in the process of applying the Group's
accounting policies.
Going concern
Based on financial performance to date and forecasts along with
the available banking facilities, there is a reasonable expectation
that the Group has adequate resources to continue in operational
existence for the foreseeable future. The Group therefore continues
to adopt the going concern basis of accounting in preparing the
annual financial statements.
The Board has prepared cash flow forecasts for the period to 31
May 2023. Under this base case scenario, the Group is expected to
continue to have very significant headroom relative to the funding
available to it and to comply with its banking covenants.
The Board has also considered a severe downside scenario based
on a significant and sustained reduction in Fuels' profitability
alongside underperformance in Food and Feeds. This downside
scenario excludes any mitigating actions that the Board would be
able to take to reduce costs. Under this scenario, the Group would
still expect to have sufficient headroom in its financing
facilities.
The Group therefore continues to adopt the going concern basis
of accounting in preparing the annual financial statements.
Headline operating profit, headline profit before taxation,
headline EBITDA and headline earnings
The Directors consider that headline operating profit, headline
profit before taxation, headline EBITDA and headline earnings per
share measures, referred to in these Group financial statements,
provide useful information for shareholders on underlying trends
and performance.
Headline operating profit is reported operating profit after
adding back exceptional items and amortisation of acquired
intangibles.
Headline profit before taxation is reported profit before
taxation after adding back the net finance cost in respect of the
Group's defined benefit pension scheme, exceptional items and
amortisation of acquired intangibles, to show the underlying
performance of the Group.
Headline EBITDA refers to reported operating profit after adding
back exceptional items and amortisation of acquired intangibles.
The headline EBITDA calculation excludes the impact of IFRS 16
depreciation.
The calculation of headline earnings excludes the exceptional
impact of remeasuring deferred tax balances. Headline EPS for the
year ended 31 May 2020 has been re-presented on a like-for-like
basis. The calculations of basic and diluted headline earnings per
share are shown in note 8.
Exceptional items
The Group's income statement separately identifies exceptional
items. Such items are those that, in the Directors' judgement, are
one-off in nature or non-operating and need to be disclosed
separately by virtue of their size or incidence and may include,
but are not limited to, restructuring costs, cyber-related costs,
acquisition-related costs, costs of implementing new systems and
income from legal settlements. In determining whether an item
should be disclosed as an exceptional item, the Directors consider
quantitative as well as qualitative factors such as the frequency,
predictability of occurrence and significance. This is consistent
with the way financial performance is measured by management and
reported to the Board. Disclosing exceptional items separately
provides additional understanding of the performance of the
Group.
Forward-looking statements
Certain statements in this results announcement are forward
looking. The terms 'expect', 'anticipate', 'should be', 'will be'
and similar expressions identify forward-looking statements.
Although the Board of Directors believes that the expectations
reflected in these forward-looking statements are reasonable, such
statements are subject to a number of risks and uncertainties and
events could differ materially from those expressed or implied by
these forward-looking statements.
Adoption of new and revised standards
The following new standards, amendments to standards or
interpretations are mandatory for the first time for the financial
year beginning 1 June 2020.
The Group has adopted the following new standards, amendments
and interpretations now applicable. None of these standards and
interpretations have had any material effect on the Group's results
or net assets.
Applicable for
financial year
Standard or interpretation Content beginning on
-------------------------- --------------------- ---------------
Amendment to IFRS
9 Financial Instruments 1 June 2020
Amendment to IFRS
3 Business Combinations 1 June 2020
Amendment to IFRS
16 Leases 1 June 2020
-------------------------- --------------------- ---------------
The following standards, amendments and interpretations are not
yet effective and have not been adopted early by the Group:
Applicable for
financial year
Standard or interpretation Content beginning on
-------------------------- ------------------- ---------------
IFRS 4 Insurance Contracts 1 June 2021
-------------------------- ------------------- ---------------
These standards are not expected to have a material impact on
the Group in the current or future reporting periods and on
foreseeable future transactions.
3. Group Annual Report and statutory accounts
The financial information set out above does not constitute the
Group's statutory accounts for the years ended 31 May 2021 or 31
May 2020, but is derived from those accounts.
Statutory accounts for 2020 have been delivered to the Registrar
of Companies. The auditors, PricewaterhouseCoopers LLP, have
reported on the 2020 accounts; the report (i) was unqualified, (ii)
did not include a reference to any matters to which the auditors
drew attention by way of emphasis without qualifying their report,
and (iii) did not contain a statement under Section 498(2) or (3)
of the Companies Act 2006.
The statutory accounts for 2021 will be delivered to the
Registrar of Companies following the Annual General Meeting. The
auditors, PricewaterhouseCoopers LLP, have reported on these
accounts and their report is unqualified, does not include a
reference to any matters to which the auditors drew attention by
way of emphasis without qualifying their report, and does not
include a statement under either Section 498(2) or (3) of the
Companies Act 2006.
The Annual Report and full financial statements will be posted
to shareholders during the week commencing 16 August 2021. Further
copies will be available to the public, free of charge, from the
Company's Registered Office at NWF Group plc, Wardle, Cheshire CW5
6BP, or can be viewed on the Company's website: www.nwf.co.uk.
4. Segment information
The chief operating decision-maker has been identified as the
Board of Directors ('the Board'). The Board reviews the Group's
internal reporting in order to assess performance and allocate
resources. The Board has determined that the operating segments,
based on these reports, are Fuels, Food and Feeds.
The Board considers the business from a products/services
perspective. In the Board's opinion, all of the Group's operations
are carried out in the same geographical segment, namely the
UK.
The nature of the products/services provided by the operating
segments is summarised below:
Fuels - sale and distribution of domestic heating, industrial and road fuels
Food - warehousing and distribution of clients' ambient grocery
and other products to supermarket and
other retail distribution centres
Feeds - manufacture and sale of animal feeds and other agricultural products
Segment information about the above businesses is presented
below.
The Board assesses the performance of the operating segments
based on a measure of operating profit ('headline operating
profit'). Finance income and costs are not included in the segment
result that is assessed by the Board. Other information provided to
the Board is measured in a manner consistent with that in the
financial statements.
Inter-segment transactions are entered into under the normal
commercial terms and conditions that would also be available to
unrelated third parties.
Segment assets exclude deferred income tax assets and cash at
bank and in hand. Segment liabilities exclude taxation, borrowings
and retirement benefit obligations. Excluded items are part of the
reconciliation to consolidated total assets and liabilities.
Fuels Food Feeds Group
2021 GBPm GBPm GBPm GBPm
------------------------------------- ----- ----- ----- -----
Revenue
Total revenue 453.9 54.9 173.0 681.8
Inter-segment revenue (6.1) (0.1) - (6.2)
------------------------------------- ----- ----- ----- -----
Revenue 447.8 54.8 173.0 675.6
------------------------------------- ----- ----- ----- -----
Result
Headline operating profit 9.3 1.9 1.7 12.9
------------------------------------- ----- ----- ----- -----
Segment exceptional item (note 5) (0.1) - (0.2) (0.3)
Group exceptional item (note 5) - - - (0.2)
Amortisation of acquired intangibles (0.3) - - (0.3)
Operating profit as reported 12.1
Finance costs (note 6) (1.3)
-----
Profit before taxation 10.8
Income tax expense (note 7) (3.0)
------------------------------------- ----- ----- ----- -----
Profit for the year 7.8
------------------------------------- ----- ----- ----- -----
Other information
Depreciation and amortisation 4.3 5.6 3.0 12.9
Fixed asset additions 1.0 1.1 0.8 2.9
------------------------------------- ----- ----- ----- -----
Fuels Food Feeds Group
2021 GBPm GBPm GBPm GBPm
----------------------------------------- ------ ------ ------ -------
Balance sheet
Assets
Segment assets 80.7 45.8 56.0 182.5
----------------------------------------- ------ ------ ------ -------
Current income tax asset 0.4
Cash at bank and in hand 4.0
----------------------------------------- ------ ------ ------ -------
Consolidated total assets 186.9
----------------------------------------- ------ ------ ------ -------
Liabilities
Segment liabilities (63.6) (17.5) (20.0) (101.1)
----------------------------------------- ------ ------ ------ -------
Deferred income tax liabilities (1.9)
Borrowings (note 12) (9.5)
Retirement benefit obligations (note 13) (14.9)
----------------------------------------- ------ ------ ------ -------
Consolidated total liabilities (127.4)
----------------------------------------- ------ ------ ------ -------
Fuels Food Feeds Group
2020 GBPm GBPm GBPm GBPm
------------------------------------- ----- ----- ----- -----
Revenue
Total revenue 476.0 48.7 169.0 693.7
Inter-segment revenue (5.8) (0.4) - (6.2)
------------------------------------- ----- ----- ----- -----
Revenue 470.2 48.3 169.0 687.5
------------------------------------- ----- ----- ----- -----
Result
Headline operating profit 11.0 1.4 1.9 14.3
------------------------------------- ----- ----- ----- -----
Segment exceptional item (note 5) (0.5) - - (0.5)
Amortisation of acquired intangibles (0.3) - - (0.3)
Operating profit as reported 13.5
Finance costs (note 6) (1.5)
-----
Profit before taxation 12.0
Income tax expense (note 7) (3.1)
------------------------------------- ----- ----- ----- -----
Profit for the year 8.9
------------------------------------- ----- ----- ----- -----
Other information
Depreciation and amortisation 3.4 4.2 2.9 10.5
Fixed asset additions 0.8 3.1 1.8 5.7
------------------------------------- ----- ----- ----- -----
Fuels Food Feeds Group
2020 (Restated[3]) GBPm GBPm GBPm GBPm
----------------------------------------- ------ ------ ------ -------
Balance sheet
Assets
Segment assets 66.2 48.2 54.3 168.7
----------------------------------------- ------ ------ ------ -------
Cash at bank and in hand 5.3
----------------------------------------- ------ ------ ------ -------
Consolidated total assets 174.0
----------------------------------------- ------ ------ ------ -------
Liabilities
Segment liabilities (45.4) (19.3) (18.6) (83.3)
----------------------------------------- ------ ------ ------ -------
Current income tax liabilities (0.9)
Deferred income tax liabilities (0.5)
Borrowings (note 12) (17.2)
Retirement benefit obligations (note 13) (21.0)
----------------------------------------- ------ ------ ------ -------
Consolidated total liabilities (122.9)
----------------------------------------- ------ ------ ------ -------
5. Profit before taxation - exceptional items
A net exceptional cost of GBP0.5 million (2020: GBP0.5 million)
is included in administrative expenses. Exceptional items by type
are as follows:
2021 2020
GBPm GBPm
-------------------------- ----- ----
Acquisition-related costs 0.2 0.5
Cyber-related costs 0.7 -
Insurance reclaim credit (0.4) -
-------------------------- ----- ----
Net exceptional cost 0.5 0.5
-------------------------- ----- ----
Acquisition-related costs - The acquisition-related costs
comprise professional fees and other costs in relation to the
integration and hive-up of prior year acquisitions, and aborted
deal fees incurred during the year ended 31 May 2021.
Cyber-related costs - The cyber costs comprise certain insurance
excesses on the Group's cyber insurance policy, and other rebuild,
business interruption and professional service costs, which have
been incurred as a result of the cyber incident announced on 2
November 2020.
Insurance reclaim credit - The insurance reclaim comprises
amounts reimbursed through the Group's insurer, in respect of costs
incurred as a result of the cyber incident. Of the total credit
recognised, GBP0.2 million had been cash settled as at 31 May 2021
with a further GBP0.2 million settled post year end and recognised
within receivables. Further reimbursements are expected in respect
of cyber costs incurred but are not virtually certain and therefore
have not been recognised at the year end.
Certain legal and professional costs totalling GBP0.6 million
relating to the cyber incident have been reimbursed directly by the
Group's insurer to the relevant service providers, and as such are
not included in the gross cyber-related costs or insurance reclaims
recognised by the Group.
6. Finance costs
2021 2020
GBPm GBPm
------------------------------------------------------- ---- ----
Interest on bank loans and overdrafts 0.5 0.7
Finance costs on lease liabilities relating to IFRS 16 0.5 0.4
------------------------------------------------------- ---- ----
Total interest expense 1.0 1.1
Net finance cost in respect of defined benefit pension
schemes (note 13) 0.3 0.4
------------------------------------------------------- ---- ----
Total finance costs 1.3 1.5
------------------------------------------------------- ---- ----
7. Income tax expense
2021 2020
GBPm GBPm
-------------------------------------------------- ----- ----
Current tax
UK corporation tax on profits for the year 2.2 2.6
Adjustments in respect of prior years (0.2) -
-------------------------------------------------- ----- ----
Current tax expense 2.0 2.6
-------------------------------------------------- ----- ----
Deferred tax
Origination and reversal of temporary differences (0.1) -
Adjustments in respect of prior years (0.2) -
Effect of increased tax rate on opening balances 1.3 0.5
-------------------------------------------------- ----- ----
Deferred tax expense 1.0 0.5
-------------------------------------------------- ----- ----
Total income tax expense 3.0 3.1
-------------------------------------------------- ----- ----
During the year ended 31 May 2021, corporation tax has been
calculated at 19% of estimated assessable profits for the year
(2020: 19%).
An increase in the UK corporation tax rate to 19% with effect
from 1 April 2020 was substantively enacted on 17 March 2020. In
the opinion of the Directors, the relevant timing differences at 31
May 2020 were expected to reverse after 1 April 2020 and therefore
deferred tax was provided at a rate of 19% in the statutory
accounts for that period.
In the Spring Budget 2021, the Government announced that from 1
April 2023 the corporation tax rate would increase to 25%. This new
law was substantively enacted on 24 May 2021. Deferred tax balances
have been remeasured to either 19% or 25% depending on when the
Directors expect these timing differences to reverse. The impact of
the change in tax rate has been recognised in tax expense in profit
or loss, except to the extent that it relates to items previously
recognised outside profit or loss. For the Group, such items
include remeasurements of post-employment benefit liabilities and
the expected tax deduction in excess of the recognised expense for
equity-settled share-based payments.
The tax charge for the year can be reconciled to the profit per
the income statement as follows:
2021 2020
GBPm GBPm
------------------------------------------------------- ----- ----
Profit before taxation 10.8 12.0
------------------------------------------------------- ----- ----
Profit before taxation multiplied by the standard rate
of UK corporation tax of 19% (2020: 19%) 2.0 2.2
Effects of:
- expenses not deductible for tax purposes 0.1 0.4
- impact of increased tax rate on opening balances 1.3 0.5
- adjustments in respect of prior years (0.4) -
------------------------------------------------------- ----- ----
Total income tax expense 3.0 3.1
------------------------------------------------------- ----- ----
The Directors expect that the Group will have a higher than
standard tax charge in the future as a result of the level of the
Group's disallowable expenses, which are largely
acquisition-related costs.
8. Earnings per share
The calculation of basic and diluted earnings per share is based
on the following data:
2021 2020
------------------------------------------------------------ ------ ------
Earnings (GBPm)
Earnings for the purposes of basic and diluted earnings
per share being profit for the year attributable to equity
shareholders 7.8 8.9
------------------------------------------------------------ ------ ------
Number of shares ('000)
Weighted average number of shares for the purposes of
basic earnings per share 48,940 48,750
Weighted average dilutive effect of conditional share
awards 194 478
------------------------------------------------------------ ------ ------
Weighted average number of shares for the purposes of
diluted earnings per share 49,134 49,228
------------------------------------------------------------ ------ ------
Earnings per ordinary share (pence)
Basic earnings per ordinary share 15.9 18.2
Diluted earnings per ordinary share 15.9 18.1
------------------------------------------------------------ ------ ------
Headline earnings per ordinary share (pence) [4]
Basic headline earnings per ordinary share 20.4 21.5
Diluted headline earnings per ordinary share 20.4 21.3
------------------------------------------------------------ ------ ------
The calculation of basic and diluted headline earnings per share
is based on the following data:
2021 2020
GBPm GBPm
-------------------------------------------------------- ----- -----
Profit for the year attributable to equity shareholders 7.8 8.9
Add back/(deduct):
Net finance cost in respect of defined benefit pension
scheme 0.3 0.4
Exceptional items 0.5 0.5
Exceptional impact of remeasuring deferred tax balances 1.3 0.5
Amortisation of acquired intangibles 0.3 0.3
Tax effect of the above (0.2) (0.1)
-------------------------------------------------------- ----- -----
Headline earnings 10.0 10.5
-------------------------------------------------------- ----- -----
Following the announcement of the corporation tax rate increase
from 19% to 25% from 1 April 2023, which was substantively enacted
into law on 24 May 2021, deferred tax balances have been remeasured
to either 19% or 25% depending on when the Directors expect these
timing differences to reverse. This results in an additional
deferred tax charge in the year of GBP1.3 million (2020: GBP0.5
million). To maintain consistency of reporting headline EPS
metrics, the headline earnings calculation has been adjusted to
exclude the exceptional impact of this remeasurement, with the
prior year balance re-presented on a like-for-like basis.
The impact of this adjustment to headline earnings and headline
EPS is as follows:
2021 2020
------------------------------------------------------------ ---- ----
Headline earnings (GBPm) (as previously reported) 8.7 10.0
Exceptional impact of remeasuring deferred tax balances
(GBPm) 1.3 0.5
Headline earnings (GBPm) (like-for-like basis) 10.0 10.5
------------------------------------------------------------ ---- ----
Headline earnings per ordinary share (pence) (as previously
reported)
Basic earnings per ordinary share 17.7 20.5
Diluted earnings per ordinary share 17.7 20.3
------------------------------------------------------------ ---- ----
Headline earnings per ordinary share (pence) (impact of
re-presentation)
Basic earnings per ordinary share 2.7 1.0
Diluted earnings per ordinary share 2.7 1.0
------------------------------------------------------------ ---- ----
Headline earnings per ordinary share (pence) (like-for-like
basis)
Basic headline earnings per ordinary share 20.4 21.5
Diluted headline earnings per ordinary share 20.4 21.3
------------------------------------------------------------ ---- ----
9. Dividends paid
2021 2020
GBPm GBPm
----------------------------------------------------------- ---- ----
Final dividend for the year ended 31 May 2020 of 5.9p
(2019: 5.6p) per share 2.9 2.7
Interim dividend for the year ended 31 May 2021 of 1.0p
(2020: 1.0p) per share 0.5 0.5
----------------------------------------------------------- ---- ----
Amounts recognised as distributions to equity shareholders
in the year 3.4 3.2
----------------------------------------------------------- ---- ----
Proposed final dividend for the year ended 31 May 2021
of 6.2p (2020: 5.9p) per share 3.0 2.9
----------------------------------------------------------- ---- ----
The proposed final dividend is subject to approval at the AGM on
30 September 2021 and has not been included as a liability in these
Group financial statements.
10. Share capital
Number
of shares Total
'000 GBPm
----------------------------------------------------- --------- -----
Allotted and fully paid: ordinary shares of 25p each
Balance at 1 June 2019 48,750 12.2
Issue of shares (see below) - -
----------------------------------------------------- --------- -----
Balance at 31 May 2020 48,750 12.2
Issue of shares (see below) 254 0.1
----------------------------------------------------- --------- -----
Balance at 31 May 2021 49,004 12.3
----------------------------------------------------- --------- -----
During the year ended 31 May 2021, 253,524 shares (2020: no
shares) with an aggregate nominal value of GBP63,381 (2020: GBPNil)
were issued under the Group's conditional Performance Share
Plan.
The maximum total number of ordinary shares, which may vest in
the future in respect of conditional Performance Share Plan awards
outstanding at 31 May 2021, amounted to 1,400,421 (31 May 2020:
1,441,604). These shares will only be issued subject to satisfying
certain performance criteria.
11. Business combinations
On 2 December 2019, the Group acquired 100% of the share capital
of Ron Darch & Sons Co Limited, a 35 million litre fuel and
coal distributor based in Somerset.
Following finalisation of the acquisition accounting,
adjustments have been made to the value attributable to deferred
tax liabilities:
Initial
fair Fair
value value
of of
assets assets
acquired Adjustments acquired
GBPm GBPm GBPm
------------------------------------------- --------- ----------- ---------
Intangible assets - goodwill 2.2 0.1 2.3
Intangible assets - brand 0.2 - 0.2
Intangible assets - customer relationships 0.8 - 0.8
Property, plant and equipment 1.4 - 1.4
Stock 0.6 - 0.6
Trade and other receivables 1.5 - 1.5
Cash 4.5 - 4.5
Trade and other payables (2.6) - (2.6)
Corporation tax liability (0.1) - (0.1)
Deferred tax liability (0.1) (0.1) (0.2)
------------------------------------------- --------- ----------- ---------
8.4 - 8.4
------------------------------------------- --------- ----------- ---------
During the year ended 31 May 2021, following finalisation of the
completion accounts, a final balance of GBP1.1 million was paid in
respect of the acquisition.
12. Analysis of cash and cash equivalents and reconciliation to
net debt
Other
1 June Cash non-cash 31 May
2020 flow movements 2021
GBPm GBPm GBPm GBPm
------------------------------------------- ------ ----- --------- ------
Cash and cash equivalents 5.3 (1.3) - 4.0
Borrowings (17.2) 7.7 - (9.5)
Hire purchase obligations(1) (0.4) 0.2 - (0.2)
------------------------------------------- ------ ----- --------- ------
Total Group (excluding lease liabilities) (12.3) 6.6 - (5.7)
------------------------------------------- ------ ----- --------- ------
Lease liabilities (excluding hire purchase
obligations transferred) (26.3) 7.4 (6.7) (25.6)
------------------------------------------- ------ ----- --------- ------
Total Group (including lease liabilities) (38.6) 14.0 (6.7) (31.3)
------------------------------------------- ------ ----- --------- ------
1 Following the adoption of IFRS 16 'Leases', hire purchase
obligations are now recognised within lease liabilities, shown here
for comparative purposes only.
13. Retirement benefit obligations
The Group operates a defined benefit pension scheme providing
benefits based on final pensionable earnings, which is closed to
future accrual.
NWF Group Benefits Scheme
The scheme is administered by a fund that is legally separated
from the Group. The trustees of the pension fund are required by
law to act in the interest of the fund and of all relevant
stakeholders in the scheme. The trustees are responsible for the
investment policy with regard to the assets of the fund.
The scheme was closed to new members during the year ended 31
May 2002 and closed to future accrual with effect from April
2016.
The triennial actuarial valuation of this scheme was completed
in the year ended 31 May 2021, with a deficit of GBP16.8 million at
the valuation date of 31 December 2019. The present value of the
defined benefit obligation and the related current service cost
were measured using the Projected Unit Credit Method. In these
financial statements this liability has been updated in order to
derive the IAS 19R valuation as of 31 May 2021. The next full
triennial valuation will be completed in the year ending 31 May
2024.
The triennial valuation resulted in Group contributions of
GBP2.1 million per annum, including recovery plan payments of
GBP1.8 million for financial years ending 31 May 2021 and 31 May
2022. From 1 June 2022 to 31 December 2027 recovery plan payments
of GBP2.1 million per annum will be paid. In addition, from 1
January 2022 a percentage increase based on total dividend growth
over GBP3.1 million will be paid.
The amounts recognised in the balance sheet in respect of the
defined benefit scheme are as follows:
2021 2020
GBPm GBPm
------------------------------------------------------- ------ ------
Present value of defined benefit obligations (60.0) (61.1)
Fair value of scheme assets 45.1 40.1
------------------------------------------------------- ------ ------
Deficit in the scheme recognised as a liability in the
balance sheet (14.9) (21.0)
Related deferred tax asset 3.7 4.0
------------------------------------------------------- ------ ------
Net pension liability (11.2) (17.0)
------------------------------------------------------- ------ ------
Changes in the present value of the defined benefit obligation
are as follows:
2021 2020
GBPm GBPm
----------------------------------------------------------------- ----- -----
At 1 June 61.1 55.3
Interest cost 1.0 1.3
Remeasurement losses:
- actuarial losses arising from changes in financial assumptions 2.6 4.9
- actuarial (gains)/losses arising from changes in demographic
assumptions (4.0) 0.6
- actuarial losses on experience adjustment 1.2 -
Benefits paid (1.9) (2.1)
Past service cost - 1.1
----------------------------------------------------------------- ----- -----
At 31 May 60.0 61.1
----------------------------------------------------------------- ----- -----
Changes in the fair value of scheme assets are as follows:
2021 2020
GBPm GBPm
--------------------------------- ----- -----
At 1 June 40.1 38.0
Interest income 0.7 0.9
Remeasurement gains:
- actuarial gains on plan assets 3.8 1.5
Contributions by employer 2.7 2.1
Expenses (0.3) (0.3)
Benefits paid (1.9) (2.1)
--------------------------------- ----- -----
At 31 May 45.1 40.1
--------------------------------- ----- -----
Within the Group's Half Year Report for 2020/21, disclosures
were made in respect of the actuarial pension valuation as at 30
November 2020. On subsequent review of the supporting information
provided for the purposes of the disclosure, an error was
identified. The error was driven by an incorrect application of the
postcode weighting methodology applied by the Scheme Actuary in the
IAS 19 valuation as at 30 November 2020 which impacted the
mortality rate assumptions. The impact of the error was an
understatement of the present value of the scheme obligations, as
at 30 November 2020, by GBP1.0 million. As a result, the
post-employment benefit obligations at 30 November 2020 should have
been a GBP19.7 million liability compared to the reported GBP18.7
million liability. As a result, both retained earnings and net
assets should have been GBP1.0 million lower. The error had no
impact on the Condensed Consolidated Income Statement or the
Condensed Consolidated Cash Flow Statement.
14. Critical accounting estimates and judgements
The Group makes estimates and assumptions concerning the future.
The resulting accounting estimates will, by definition, seldom
equal the related actual results. The assumptions that have a
significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year
are discussed below.
Defined benefit pension scheme - valuation assumptions
The balance sheet carrying values of defined benefit pension
scheme surpluses or deficits are calculated using independently
commissioned actuarial valuations. These valuations are based on a
number of assumptions, including the most appropriate mortality
rates to apply to the profile of scheme members and the financial
assumptions regarding discount rates and inflation. All of these
are estimates of future events and are therefore uncertain.
Significant actuarial assumptions for the determination of the
defined benefit liability are discount rate, price inflation and
mortality. The sensitivity analyses shown below have been
determined based on reasonably possible changes of the respective
assumptions occurring at the balance sheet dates, while holding all
other assumptions constant.
Increase Decrease
Impact on defined benefit obligation GBPm GBPm
------------------------------------------------- -------- --------
0.25% change in discount rate (2.2) 2.2
0.25% change in RPI inflation 1.7 (1.7)
One-year change in the life expectancy at age 65 2.6 (2.6)
------------------------------------------------- -------- --------
Assessment of impairment
The Group tests annually for impairment of goodwill and fixed
asset balances, which involves using key judgements including
estimates of future business performance and cash generation,
discount rates and long-term growth rates.
The recoverable amounts of CGUs are determined using value in
use calculations. The value in use calculations use post-tax cash
flow projections based on the Board-approved budget for the year
ending 31 May 2022 and four years of divisional strategic plans
thereafter. Subsequent cash flows are extrapolated using an
estimated growth rate of 2%.
These value in use calculations are subject to a series of
sensitivity analyses using reasonable assumptions concerning the
future performance of the CGUs and assessing the impact of a 1%
increase in the discount rate. None of these reasonable downside
scenarios would result in an impairment.
Carrying value of trade receivables
The Group holds material trade receivable balances, and the
calculations of provisions for impairment are estimates of future
events and therefore uncertain. IFRS 9 requires the Group to
consider forward-looking information and the probability of default
when calculating expected credit losses. The Group considers
reasonable and supportable customer-specific and market information
about past events, current conditions and forecasts of future
economic conditions when measuring expected credit losses.
From a completeness perspective, the Directors are not aware of
any other critical judgements within the Group that give rise to a
significant risk of material adjustment within the next financial
year.
15. Directors' responsibilities statement
The Directors are responsible for preparing the Annual Report in
accordance with applicable laws and regulations and consider that
the Annual Report, taken as a whole, is fair, balanced and
understandable and that it provides the information necessary for
shareholders to assess the Company's performance, business model
and strategy.
The Company's Annual Report for the year ended 31 May 2021,
which will be posted to shareholders on or before 19 August 2021,
contains the following statement regarding responsibility for the
Strategic Report, the Directors' Report (including the Corporate
Governance Report), the Board Report on Remuneration and the
financial statements included within the Annual Report:
"Each of the Directors confirms that to the best of their
knowledge:
-- the Group financial statements, which have been prepared in
accordance with international accounting standards adopted pursuant
to Regulation (EC) No 1606/2002 as it applies in the European
Union, give a true and fair view of the assets, liabilities,
financial position and result of the Group;
-- the Strategic Report includes a fair review of the
development and performance of the business and the position of the
Group, together with a description of the principal risks and
uncertainties that it faces;
-- there is no relevant audit information of which the Company's auditors are 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 auditors are aware
of that information."
16. Contingent assets
On 2 November 2020, the Group announced that it had experienced
an unauthorised access to the IT systems in two of its divisions
(Feeds and Fuels) and at Group level. The Group acted promptly to
instigate precautionary measures and engaged specialist external
support to contain and manage the incident. On 12 November 2020,
the Group announced that following extensive investigations,
supported by cyber security experts, the Group was satisfied that
the incident had been contained and additional security measures
had been applied to all of the Group's IT systems.
The Group identifies a contingent asset in respect of the
reimbursement of remaining unsettled costs from its insurer. Whilst
it is probable that an inflow of economic benefits will be
received, at the time of this report the amount of any
reimbursement is not virtually certain and therefore does not
warrant recognition as a reimbursement asset.
17. Financial calendar
Annual General Meeting 30 September 2021
Dividend:
- Ex-dividend date 4 November 2021
- Record date 5 November 2021
- Payment date 10 December 2021
Announcement of half-year results Early February 2022
Publication of Interim Report Early February 2022
Interim dividend paid May 2022
Financial year end 31 May 2022
Announcement of full-year results Early August 2022
Publication of Annual Report and Accounts Late August 2022
----------------------------------------- -------------------
[1] The calculation of headline earnings excludes the
exceptional impact of remeasuring deferred tax balances. Headline
EPS for the year ended 31 May 2020 has been re-presented on a
like-for-like basis.
[2] GBP4.4 million of deferred tax assets, recognised within
non-current assets, have been reclassified to non-current
liabilities and offset against GBP4.9 million of deferred tax
liabilities in the year ended 31 May 2020 . Deferred income tax
assets and liabilities are offset when there is a legally
enforceable right to offset current tax assets against current tax
liabilities and when the deferred income taxes relate to the same
fiscal authority. The impact on the balance sheet as at 31 May 2019
would be to reclass GBP3.1 million of deferred tax assets,
recognised within non-current assets, to non-current liabilities
and offset against GBP3.7 million of deferred tax liabilities.
[3] GBP4.4 million of deferred tax assets, recognised within
non-current assets, have been reclassified to non-current
liabilities and offset against GBP4.9 million of deferred tax
liabilities in the year ended 31 May 2020 . Deferred income tax
assets and liabilities are offset when there is a legally
enforceable right to offset current tax assets against current tax
liabilities and when the deferred income taxes relate to the same
fiscal authority. The impact on the balance sheet as at 31 May 2019
would be to reclass GBP3.1 million of deferred tax assets,
recognised within non-current assets, to non-current liabilities
and offset against GBP3.7 million of deferred tax liabilities.
[4] The calculation of headline earnings excludes the
exceptional impact of remeasuring deferred tax balances. Headline
EPS for the year ended 31 May 2020 has been re-presented on a
like-for-like basis.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
FR BLGDIXGGDGBD
(END) Dow Jones Newswires
August 03, 2021 02:00 ET (06:00 GMT)
Nwf (LSE:NWF)
Historical Stock Chart
From Jul 2024 to Aug 2024
Nwf (LSE:NWF)
Historical Stock Chart
From Aug 2023 to Aug 2024