Notes to the Consolidated Financial
Statements
1. Description of
business
The consolidated financial
statements of Mincon Group plc (also referred to as "Mincon" or
"the Group") comprises the Company and its subsidiaries (together
referred to as "the Group"). The companies registered address is
Smithstown Industrial Estate, Smithstown, Shannon, Co. Clare,
Ireland.
The Group is an Irish engineering
Group, specialising in the design, manufacturing, sale and
servicing of rock drilling tools and associated products. Mincon
Group Plc is domiciled in Shannon, Ireland.
On 26 November 2013, Mincon Group
plc was admitted to trading on the Euronext Growth and the
Alternative Investment Market (AIM) of the London Stock
Exchange.
2. Basis of
preparation
These consolidated financial statements have
been prepared in accordance with the International Financial
Reporting Standards as adopted by the European Union (IFRS), which
comprise standards and interpretations approved by the
International Accounting Standards Board (IASB) and endorsed by the
EU.
The Group's financial statements consolidate
those of the parent company and all of its subsidiaries as of 31
December 2024. All subsidiaries have a reporting date of 31
December.
The accounting policies set out in note 3 have
been applied consistently in preparing the Group and Company
financial statements for the years ended 31 December 2024 and 31
December 2023.
The Group and Company financial statements are
presented in euro, which is the functional currency of the Company
and also the presentation currency for the Group's financial
reporting. Unless otherwise indicated, the amounts are presented in
thousands of euro. These financial statements are prepared on the
historical cost basis.
The preparation of the consolidated financial
statements in conformity with IFRS requires management to make
judgements, estimates and assumptions that affect the application
of policies and reported amounts of assets and liabilities, income
and expenses. The judgements, estimates and associated assumptions
are based on historical experience and various other factors that
are believed to be reasonable under the circumstances. Actual
results could differ materially from these estimates. The areas
involving a high degree of judgement and the areas where estimates
and assumptions are critical to the consolidated financial
statements are discussed in note 3.
The Directors believe that the Group has
adequate resources to continue in operational existence for the
foreseeable future and that it is appropriate to continue to
prepare our consolidated financial statements on a going concern
basis.
3. Material accounting principles and significant accounting
estimates and judgements
The accounting principles as set out in the
following paragraphs have, unless otherwise stated, been
consistently applied to all periods presented in the consolidated
financial statements and for all entities included in the
consolidated financial statements.
The following new and amended standards are
not expected to have a significant impact on the Group's
consolidated financial statements:
New Standards adopted as at 1 January
2024
•
Liability
in a Sale and Leaseback (Amendments to IFRS 16 Leases
•
Classification of Liabilities as Current or Non-Current
(Amendments to IAS 1 Presentation of Financial
Statements)
•
Supplier Finance Arrangements (Amendments to IAS 7 Statement
of Cash Flows and IFRS 7 Financial
Instruments: Disclosures)
•
Non-current Liabilities with Covenants (Amendments to IAS
1)
Standards, amendments and Interpretations to
existing Standards that are not yet effective and have been not
adopted early by the Group
•
Lack of Exchangeability (Amendments to IAS 21 The Effects of
Changes in Foreign Exchange Rates)
•
Classification and Measurement of Financial
Instruments (Amendments to IFRS 9 and IFRS 7)
•
Presentation and base disclosure requirements for financial
statements (Replacement of IAS 1 with IFRS 18)
•
Subsidiaries without Public Accountability: Disclosures (IFRS
19)
3. Material accounting principles and significant
accounting estimates and judgements (continued)
Segment Reporting
An operating segment is a
component of the Group that engages in business activities from
which it may earn revenue and incur expenses, and for which
discrete financial information is available. The operating results
of the operating segment is reviewed regularly by the Board of
Directors, the chief operating decision maker, to make decisions
about allocation of resources and also to assess
performance.
Results are reported in a manner
consistent with the internal reporting provided to the chief
operating decision maker (CODM). Our CODM
has been identified as the Board of Directors.
The Group has determined that it
has one reportable segment (see Note 5). The Group is managed as a
single business unit that sells drilling equipment, primarily
manufactured by Mincon manufacturing sites.
Revenue
Recognition
The Group is involved in the sale and
servicing of rock drilling tools and associated products. Revenue
from the sale of these goods and services to customers is measured
at the fair value of the consideration received or receivable
(excluding sales taxes). The Group recognises revenue when it
transfers control of goods to a customer or has completed a
service over a set period (typically one month) for a customer.
The following provides information
about the nature and timing of the satisfaction of performance
obligations in contracts with customers, including significant
payment terms, and the related revenue recognition
policies.
Customers obtain control of products when one
of the following conditions are satisfied:
1. The goods have been picked up
by the customer from Mincon's premises;
2. When goods have been shipped by
Mincon, the goods are delivered to the customer and have been
accepted at their premises; or
3. The customer
accepts responsibility of the goods during transit that is in line
with international commercial
terms.
Where the Group provides a service to a
customer, who also purchases Mincon manufactured product from the
Group, the revenue associated with this service is separately
identified in a set period (typically one month) and is recognised
in the Groups revenue as it occurs.
Invoices are generated when the above
conditions are satisfied. Invoices are payable within the timeframe
as set in agreement with the customer at the point of placing the
order of the product or service. Discounts are provided from
time-to-time to customers.
Customers may be permitted to return goods
where issues are identified with regard to quality of the product.
Returned goods are exchanged only for new goods or a credit note.
No cash refunds are offered.
Where the customer is permitted to return an
item, revenue is recognised to the extent that it is highly
probable that a significant reversal in the amount of cumulative
revenue recognised will not occur. Therefore, the amount of revenue
recognised is adjusted for expected returns, which are estimated
based on the historical data for specific types of product. In
these circumstances, a refund liability and a right to recover
returned goods asset are recognised.
The Group recognises contract liabilities for
consideration received in respect of unsatisfied performance
obligations and reports these amounts as accruals and other
liabilities in its consolidated statement of financial position.
Similarly, if the Group satisfies a performance obligation before
it receives the consideration, the Group recognises either a
contract asset or a receivable in its consolidated statement of
financial position, depending on whether something other than the
passage of time is required before the consideration is
due.
The Group has elected to apply IFRS 15
Practical expedient, the Group need not adjust the promised amount
of consideration for the effects of a significant financing
component if the entity expects, at contract inception, that the
period between when the Group transfers a promised good or service
to a customer and when the customer pays for that good or service
will be one year or less.
Government
Grants
Amounts recognised in the profit and loss
account are presented under the heading Operating Costs on a
systematic basis in the periods in which the expenses are
recognised, unless the conditions for receiving the grant are met
after the related expenses have been recognised. In this case, the
grant is recognised when it is receivable. Current government
grants have no conditions attached.
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3. Material accounting principles and significant
accounting estimates and judgements (continued)
Operating expenses
Operating expenses are recognised in profit or
loss as the service is utilised or incurred.
Earnings per share
Basic earnings per share is
calculated based on the profit for the year attributable to owners
of the Company and the basic weighted average number of shares
outstanding. Diluted earnings per share is calculated based on the
profit for the year attributable to owners of the Company and the
diluted weighted average number of shares outstanding.
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Profit or loss
from discontinued operations
A discontinued operation is a component of the
Group that either has been disposed of, or is
classified as held for sale. A discontinued operation
represents a separate major line of the business. Profit or loss
from discontinued operations comprises the post-tax profit or loss
of discontinued operations and the post-tax gain or loss recognised
on the measurement to fair value less costs to sell or on the
disposal group(s) constituting the discontinued
operation.
Taxation
Current tax comprises the expected
tax payable or receivable on the taxable income or loss for the
year and any adjustment to the tax payable or receivable in respect
of previous years. The amount of current tax payable or receivable
is the best estimate of the tax amount expected to be paid or
received that reflects uncertainty related to income taxes, if any.
It is measured using tax rates enacted or substantively enacted at
the reporting date. Current tax also includes any tax arising from
dividends.
Current tax assets and liabilities
are offset only if certain criteria are met.
Deferred tax
Deferred tax is recognised in
respect of temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the
amounts used for taxation purposes. Deferred tax is not recognised
for:
•
not a business combination and that affects neither accounting nor
taxable profit or loss;
•
temporary differences related to investments in subsidiaries,
associates and joint arrangements to the extent that the Group is
able to control the timing of the reversal of the temporary
differences and it is probable that they will not reverse in the
foreseeable future; and
•
taxable temporary differences arising on the initial recognition of
goodwill.
Deferred tax assets are recognised
for unused tax losses, unused tax credits and deductible temporary
differences to the extent that it is probable that future taxable
profits will be available against which they can be used. Future
taxable profits are determined based on the reversal of relevant
taxable temporary differences. If the amount of taxable temporary
differences is insufficient to recognise a deferred tax asset in
full, then future taxable profits, adjusted for reversals of
existing temporary differences, are considered, based on the
business plans for individual subsidiaries in the Group. 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; such reductions are reversed when the
probability of future taxable profits improves.
Unrecognised deferred tax assets
are reassessed at each reporting date and recognised to the extent
that it has become probable that future taxable profits will be
available against which they can be used.
Deferred tax is measured at the
tax rates that are expected to be applied to temporary differences
when they reverse, using tax rates enacted or substantively enacted
at the reporting date.
The measurement of deferred tax
reflects the tax consequences that would follow from the manner in
which the Group expects, at the reporting date, to recover or
settle the carrying amount of its assets and
liabilities.
Deferred tax assets and
liabilities are offset only if certain criteria are met.
Leases
At inception of a contract, the
Group assesses whether a contract is, or contains, a lease. A
contract is, or contains, a lease if the contract conveys the right
to control the use of an identified asset for a period of time in
exchange for consideration. To assess whether a contract conveys
the right to control the use of an identified asset, the Group uses
the definition of a lease in IFRS 16.
3. Material accounting principles and significant
accounting estimates and judgements (continued)
Leases (continued)
(i) As a lessee
At commencement or on modification
of a contract that contains a lease component, the Group allocates
the consideration in the contract to each lease component on the
basis of its relative stand-alone prices.
The Group recognises a right-of-use
asset and a lease liability at the lease commencement date. The
right-of-use asset is initially measured at cost, which comprises
the initial amount of the lease liability adjusted for any lease
payments made at or before the commencement date, plus any initial
direct costs incurred and an
estimate of costs to dismantle and
remove the underlying asset or to restore the underlying asset or
the site on which it is located, less any lease incentives
received.
The right-of-use asset is
subsequently depreciated using the straight-line method from the
commencement date to the end of the lease term, unless the lease
transfers ownership of the underlying asset to the Group by the end
of the lease term or the cost of the right-of-use asset reflects
that the Group will exercise a purchase option. In that case the
right-of-use asset will be depreciated over the useful life of the
underlying asset, which is determined on the same basis as those of
property and equipment. In addition, the right-of-use asset is
periodically reduced by impairment losses, if any, and adjusted for
certain remeasurements of the lease liability.
The lease liability is initially
measured at the present value of the lease payments that are not
paid at the commencement date, discounted using the interest rate
implicit in the lease or, if that rate cannot be readily
determined, the Group's incremental borrowing rate.
The Group determines its
incremental borrowing rate by obtaining interest rates from various
external financing sources.
The lease liability is measured at
amortised cost using the effective interest method. It is
remeasured when there is a change in future lease payments arising
from a change in an index or rate, if there is a change in the
Group's estimate of the amount expected to be payable under a
residual value guarantee, if the Group changes its assessment of
whether it will exercise a purchase, extension or termination
option or if there is a revised in-substance fixed lease
payment.
When the lease liability is
remeasured in this way, a corresponding adjustment is made to the
carrying amount of the right-of-use asset, or is recorded in profit
or loss if the carrying amount of the right-of-use asset has been
reduced to zero.
(ii) As a lessor
At inception or on modification of
a contract that contains a lease component, the Group allocates the
consideration in the contract to each lease component on the basis
of their relative stand-alone prices.
When the Group acts as a lessor,
it determines at lease inception whether each lease is a finance
lease or an operating lease.
When the Group is an intermediate
lessor, it accounts for its interests in the head lease and the
sub-lease separately. It assesses the lease classification of a
sub-lease with reference to the right-of-use asset arising from the
head lease, not with reference to the underlying asset.
Short term leases and leases of low-value
assets
The Group has elected not to
recognise right-of-use assets and lease liabilities for leases of
low-value assets and short-term leases, including IT equipment. The
Group recognises the lease payments associated with these leases as
an expense on a straight-line basis over the lease term.
Inventories and capital equipment
Inventories and capital equipment
(rigs) are valued at the lower of cost or net realisable value. Net
realisable value is the estimated selling price in the ordinary
course of business less the estimated costs of completion and
selling expenses. The cost of inventories is based on the first-in,
first-out principle and includes the costs of acquiring inventories
and bringing them to their existing location and condition.
Inventories manufactured by the Group and work in progress include
an appropriate share of production overheads based on normal
operating capacity. Inventories are reported net of deductions for
obsolescence.
3. Material accounting principles and significant
accounting estimates and judgements (continued)
Intangible Assets and Goodwill
Goodwill
The Group accounts for
acquisitions using the purchase accounting method as outlined in
IFRS 3 Business Combinations. Goodwill
represents the future economic benefits arising from a business
combination that are
not individually identified and
separately recognised. Goodwill is not amortised and is tested
annually.
Intangible assets
Expenditure on research activities
is recognised in profit or loss as incurred.
Development expenditure is
capitalised only if the Group can demonstrate if the expenditure
can be measured reliably, the product or process is technically and
commercially feasible, future economic benefits are probable and
the Group intends to and has sufficient resources to complete
development and to use or sell the asset. Otherwise, it is
recognised in the profit or loss as incurred. Subsequent to initial
recognition, development expenditure is measured at cost less
accumulated amortisation and any accumulated impairment
losses.
Acquired IP which has been
obtained at a cost that can be measured reliably, and that meets
the definition and recognition criteria of IAS38, will be accounted
for as an intangible asset.
Internally developed intangible
assets are recognised post the development phase once the company
has assessed the development phase is complete and the asset is
ready for use. Internally generated assets have an finite life.
They will be amortised over a fifteen year period on a straight
line basis. Currently there is twelve years and nine months
remaining on the amortisation.
Foreign Currency
Functional and presentation currency
The consolidated financial statements are
presented in Euro currency units, which is also the functional
currency of the parent company.
Foreign currency transactions and balances
Transactions in foreign currencies (those
which are denominated in a currency other than the functional
currency) are translated at the foreign exchange rate ruling at the
date of the transaction. Monetary assets and liabilities
denominated in foreign currencies are translated using the foreign
exchange rate at the statement of financial position date. Exchange
gains and losses related to trade receivables and payables, other
financial assets and payables, and other operating receivables and
payables are separately presented on the face of the income
statement.
Exchange rate differences on translation to
functional currency are reported in profit or loss, except when
reported in other comprehensive income for the translation of
intra-group receivables from, or liabilities to, a foreign
operation that in substance is part of the net investment in the
foreign operation.
Exchange rates for major currencies used in
the various reporting periods are shown in note 22.
Translation of accounts of foreign entities
The assets and liabilities of foreign
entities, including goodwill and fair value adjustments arising on
consolidation, are translated to euro at the exchange rates ruling
at the reporting date. Revenues, expenses, gains, and losses are
translated at average exchange rates, when these approximate the
exchange rate for the respective transaction. Foreign exchange
differences arising on translation of foreign entities are
recognised in other comprehensive income and are accumulated in a
separate component of equity as a translation reserve.
On divestment of foreign entities, the
accumulated exchange differences, are recycled through profit or
loss, increasing or decreasing the profit or loss on
divestments.
Business combinations and consolidation
The consolidated financial
statements include the financial statements of the Group and all
companies in which Mincon Group plc, directly or indirectly, has
control. The Group controls an entity when it is exposed to, or has
rights to, variable returns from its involvement with the entity
and has the ability to affect those returns through its power over
the entity. The financial statements of subsidiaries are included
in the consolidated financial statements from the date on which
control commences until the date on which control
ceases.
The consolidated financial
statements have been prepared in accordance with the acquisition
method.
3. Material accounting principles and significant
accounting estimates and judgements (continued)
Business combinations and consolidation
(continued)
According to this method, business
combinations are seen as if the Group directly acquires the assets
and assumes the liabilities of the entity acquired. At the
acquisition date, i.e., the date on which control is obtained, each
identifiable asset acquired, and liability assumed is recognised at
its acquisition-date fair value.
Consideration transferred is
measured at its fair value. It includes the sum of the acquisition
date fair values of the assets transferred, liabilities incurred to
the previous owners of the acquiree, and equity interests issued by
the Group. Deferred consideration is initially measured at its
acquisition-date fair value. Any subsequent change in such fair
value is recognised in profit or loss, unless the deferred
consideration is classified as equity. In that case, there is no
remeasurement and the subsequent settlement is accounted for within
equity. Deferred consideration arises in the current year where
part payment for an acquisition is deferred to the following year
or years.
Transaction costs that the Group incurs in
connection with a business combination, such as legal fees, due
diligence fees, and other professional and consulting fees are
expensed as incurred.
Goodwill is measured as the excess
of the fair value of the consideration transferred, the amount of
any non-controlling interest in the acquiree, and the fair value of
the Group's previously held equity interest in the acquiree (if
any) over the net of acquisition-date fair values of the
identifiable assets acquired and liabilities assumed. Goodwill is
not amortised but tested for impairment at least
annually.
Non-controlling interest is
initially measured either at fair value or at the non-controlling
interest's proportionate share of the fair value of the acquiree's
identifiable net assets. This means that goodwill is either
recorded in "full" (on the total acquired net assets) or in "part"
(only on the Group's share of net assets). The choice of
measurement basis is made on an acquisition-by-acquisition
basis.
Earnings from the acquirees are
reported in the consolidated income statement from the date of
control.
Intra-group balances and
transactions such as income, expenses and dividends are eliminated
in preparing the consolidated financial statements. Profits and
losses resulting from intra-group transactions that are recognised
in assets, such as inventory, are eliminated in full, but losses
are only eliminated to the extent that there is no evidence of
impairment.
Property, plant and equipment
Items of property, plant and
equipment are carried at cost less accumulated depreciation and
impairment losses. Cost of an item of property, plant and equipment
comprises the purchase price, import duties, and any cost directly
attributable to bringing the asset to its location and condition
for use. The Group capitalises costs on initial recognition and on
replacement of significant parts of property, plant and equipment,
if it is probable that the future economic benefits embodied will
flow to the Group and the cost can be measured reliably. All other
costs are recognised as an expense in profit or loss when
incurred.
Depreciation
Depreciation is calculated based
on cost using the straight-line method over the estimated useful
life of the asset. The following useful lives are used for
depreciation:
Years
Buildings
20-30
Plant and equipment
3-10
The depreciation methods, useful
lives and residual values are reassessed annually. Land is not
depreciated.
Right of use assets are depreciated using the
straight-line method over the estimated useful life of the asset
being the remaining duration of the lease from inception date of
the asset. The depreciation methods, useful lives and residual
values are reassessed annually.
Gains or losses arising on the disposal of
property, plant and equipment are determined as the difference
between the disposal proceeds and the carrying amount of the assets
and are recognised in profit or loss either within other income or
other expenses
3. Material accounting principles and significant
accounting estimates and judgements (continued)
Financial
Assets and Liabilities
Classification and initial measurement
of financial assets financial liabilities.
Financial assets and liabilities are
recognised at fair value when the Group becomes a party to the
contractual provisions of the instrument. Purchases and sales of
financial assets are accounted for at trade date, which is the day
when the Group contractually commits to acquire or dispose of the
assets. Trade receivables are recognised once the responsibility
associated with control of the product has transferred to the
customer. Liabilities are recognised when the other party has
performed and there is a contractual obligation to pay. A financial
asset and
a financial liability are offset and the net
amount presented in the statement of financial position when there
is a legally enforceable right to set off the recognised amounts
and there is an intention to either settle on a net basis or to
realise the asset and settle the liability
simultaneously.
The classification is determined
by both:
• the entity's business model for
managing the financial asset, and
• the contractual cash flow
characteristics of the financial asset.
Subsequent
measurement of financial assets and financial
liabilities
Financial assets at amortised cost
Financial assets are measured at amortised cost
if the assets meet the following conditions (and are not designated
as FVTPL):
· they are held
within a business model whose objective is to hold the financial
assets and collect its contractual cash flows, and
· the contractual
terms of the financial assets give rise to cash flows that are
solely payments of principal and interest on the principal amount
outstanding.
After initial recognition, these are measured
at amortised cost using the effective interest method. Discounting
is omitted where the effect of discounting is
immaterial.
Financial
liabilities at amortised cost
Subsequently, financial liabilities are
measured at amortised cost using the effective interest
method.
Derecognition (fully or partially) of a
financial asset occurs when the rights to receive cash flows from
the financial instruments expire or are transferred and
substantially all of the risks and rewards of ownership have been
removed from the Group. Financial assets are assessed at each
reporting date. The Group derecognises (fully or partially) a
financial liability when the obligation specified in the contract
is discharged or otherwise expires.
Impairment of
financial assets
Financial assets are assessed from initial
recognition and at each reporting date to determine whether there
is a requirement for impairment. Financial assets require there
expected lifetime losses to be recognised from initial
recognition.
IFRS 9's impairment requirements use
forward-looking information to recognise expected credit losses -
the 'expected credit loss (ECL) model'. Instruments within the
scope of the requirements included loans and other debt-type
financial assets measured at amortised cost, trade and other
receivables.
The Group considers a broader range of
information when assessing credit risk and measuring expected
credit losses, including past events, current conditions,
reasonable and supportable forecasts that affect the expected
collectability of the future cash flows of the
instrument.
In applying this forward-looking approach, a
distinction is made between:
· financial
instruments that have not deteriorated significantly in credit
quality since initial recognition or that have low credit risk
('Stage 1'); and
· financial
instruments that have deteriorated significantly in credit quality
since initial recognition and whose credit risk is not low ('Stage
2').
'Stage 3' would cover financial assets that
have objective evidence of impairment at the reporting
date.
'12-month expected credit losses' are
recognised for the first category (ie Stage 1) while 'lifetime
expected credit losses' are recognised for the second category (ie
Stage 2).
Measurement of the expected credit losses is
determined by a probability-weighted estimate of credit losses over
the expected life of the financial instrument.
3. Material accounting principles and significant
accounting estimates and judgements (continued)
Financial
Assets and Liabilities (continued)
Trade and other receivables
The Group makes use of a simplified approach
in accounting for trade and other receivables and records the loss
allowance as lifetime expected credit losses. These are the
expected shortfalls in contractual cash flows, considering the
potential for default at any point during the life of the financial
instrument. In calculating, the Group uses its historical
experience, external indicators and forward-looking information to
calculate the expected credit losses using a provision
matrix.
The Group assesses impairment of trade and
other receivables on a collective basis as they possess shared
credit risk characteristics they have been grouped based on the
days past due.
Borrowing
costs
All borrowing costs are expensed in accordance
with the effective interest rate method.
Equity
Shares are classified as equity.
Incremental costs directly attributable to the issue of ordinary
shares and share options are recognised as a deduction from equity,
net of any tax effect.
Financial instruments carried at fair value: Deferred
consideration
Fair value is calculated based on
the present value of future principal and interest cash flows,
discounted at the market rate of interest at the reporting date.
These are set amounts detailed in each contract.
Finance income and expenses
Finance income and expense are
included in profit or loss using the effective interest
method.
Contingent liabilities
A contingent liability is a
possible obligation or a present obligation that arises from past
events that is not reported as a liability or provision, as it is
not probable that an outflow of resources will be required to
settle the obligation or that a sufficiently reliable calculation
of the amount cannot be made.
Cash and cash equivalents
Cash and cash equivalents comprise
cash balances and call deposits with maturities of three months or
less.
Non-current assets and liabilities classified as held for
sale and discontinued operations
Non-current assets classified as
held for sale are presented separately and measured at the lower of
their carrying amounts immediately prior to their classification as
held for sale and their fair value less costs to sell. However,
some held for sale assets such as financial assets or deferred tax
assets, continue to be measured in accordance with the Group's
relevant accounting policy for those assets. Once classified as
held for sale, the assets are not subject to depreciation or
amortisation. Any profit or loss arising from discontinued
operation or its remeasurement to fair value less costs to sell is
presented in the profit or loss from discontinued
operations.
Equity, reserves and dividend payments
Share capital represents the nominal
(par) value of shares that have been issued. Share premium includes
any premiums received on the issue of share capital. Any
transaction costs associated with the issuing of shares are
deducted from share premium, net of any related income tax
benefits.
Retained earnings includes all
current and prior period retained profits and share-based employee
remuneration.
Dividend distributions payable to
equity shareholders are included in other liabilities when the
dividends have been approved in a general meeting prior to the
reporting date.
Provisions
A provision is recognised in the
statement of financial position when the Group has a legal or
constructive obligation as a result of a past event, it is probable
that an outflow of economic benefits will be required to settle the
obligation, and the outflow can be estimated reliably. The amount
recognised as a provision is the best estimate of the expenditure
required to settle the present obligation at the reporting date. If
the effect of the time value of money is material, the provision is
determined by discounting the expected future cash flows at a
pre-tax rate that reflects the current market assessments of the
time value of money and, where appropriate, the risks specific to
the liability.
3. Material accounting principles and significant
accounting estimates and judgements (continued)
Provisions (continued)
A provision for restructuring is
recognised when the Group has approved a detailed and formal
restructuring plan and the restructuring has either commenced or
been announced publicly. Future operating losses are not provided
for.
Defined contribution plans
A defined contribution retirement
benefit plan is a post-employment benefit plan under which the
Group pays fixed contributions into a separate entity and will have
no legal or constructive obligation to pay further amounts.
Obligations for contributions to defined contribution retirement
benefit plans are recognised as an employee benefit expense in
profit or loss when employees provide services entitling them to
the contributions.
Share-based payment transactions
The Group operates a long-term
incentive plan which allows the Company to grant Restricted Share
Awards ("RSAs") to the Executive Management Team and senior
management. All schemes are equity settled arrangements under IFRS
2 Share-based Payment.
The grant-date fair value of
share-based payment awards granted to employees is recognised as an
employee expense, with a corresponding increase in equity, over the
period that the employees become unconditionally entitled to the
awards. The amount recognised as an expense is adjusted to reflect
the number of awards 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
awards that meet the related service and non-market performance
conditions at the vesting date. It is reversed only where
entitlements do not vest because all
non-market performance conditions
have not been met or where an employee in receipt of share
entitlements leaves the Group before the end of the vesting period
and forfeits those options in consequence.
Significant accounting estimates and
judgements
The preparation of financial
statements requires management's judgement and the use of estimates
and assumptions that affect the amounts reported in the
consolidated financial statements and accompanying notes. These
estimates and associated assumptions are based on historical
experience and various other factors that are believed to be
reasonable under the prevailing circumstances. Actual results may
differ from those estimates. The estimates and assumptions are
reviewed on an ongoing basis. Revisions to the accounting estimates
are recognised in the period in which they are revised and in any
future periods affected.
Following are the estimates and
judgements which, in the opinion of management, are significant to
the underlying amounts included in the financial reports and for
which there is a significant risk that future events or new
information could entail a change in those estimates or
judgements.
Deferred consideration (Note 22)
The deferred consideration payable
represents management's best estimate of the fair value of the
amounts that will be payable, discounted as appropriate using a
market interest rate. The fair value was estimated by assigning
probabilities, based on management's current expectations, to the
potential pay-out scenarios. The fair value of deferred
consideration is primarily dependent on the future performance of
the acquired businesses against predetermined targets and on
management's current expectations thereof.
Climate-related matters
The long-term consequences of
climate changes on financial statements are difficult to predict
and require entities to make significant assumptions and develop
estimates. Consistent with the prior year, as at 31 December 2024
the Group has not identified significant risks induced by climate
changes that could negatively and materially affect the estimates
and judgements currently used in the Group's financial statements.
Management continuously assesses the impact of climate-related
matters.
Goodwill (Note 12)
The initial recognition of
goodwill represents management' best estimate of the fair value of
the acquired entities value less the identified assets
acquired.
During the annual impairment
assessment over goodwill, management calculate the recoverable
value of the group using their best estimate of the discounted
future cash flows of the group. The fair values were estimated
using management's current and future projections of the Mincon
Group's performance as well as appropriate data inputs and
assumptions.
3. Material accounting principles and significant
accounting estimates and judgements (continued)
Significant accounting estimates and judgements (continued)
Useful life and residual values of Intangible Assets (Note
12)
Distinguishing the research and
development phase, determining the useful life, and deciding
whether the recognition requirements for the capitalisation of
development costs of new projects are met all require judgement.
These judgements are based on historical experience and various
other factors that are believed to be reasonable under the
prevailing circumstances.
After capitalisation, management
monitors whether the recognition requirements continue to be met
and whether there are any indicators that capitalised costs may be
impaired.
Trade and other receivables (Note 15)
Trade and other receivables are
included in current assets, except for those with maturities more
than 12 months after the reporting date, which are classified as
non-current assets. The Group estimates the risk that receivables
will not be paid and provides for doubtful debts in line with IFRS
9.
The Group applies the simplified
approach to providing for expected credit losses (ECL) permitted by
IFRS 9 Financial Instruments, which requires expected lifetime
losses to be recognised from initial recognition of the receivables
and considered at each reporting date. Loss rates are calculated
using a "roll rate" method based on the probability of a receivable
progressing through successive chains of non-payment to
write-off.
Trade receivables are written off
when there is no reasonable expectation of recovery, such as a
debtor failing to engage in a repayment plan with the company.
Where recoveries are made, these are recognised in the Consolidated
Income Statement.
4. Revenue
In the following table, revenue is
disaggregated between Mincon manufactured product and product that
is purchased outside the Group and resold through Mincon
distribution channels.
|
2024
|
2023
|
|
€'000
|
€'000
|
Product revenue:
|
|
|
Sale of Mincon product
|
117,418
|
128,294
|
Sale of third party
product
|
28,448
|
28,637
|
Total revenue
|
145,866
|
156,931
|
The Group's revenue disaggregated
by primary geographical markets are disclosed in Note 5.
The Group recognised contract
liability amounting to €2 million as at 31 December 2024 (2023:€1
million) which represent customer payments received in advance of
performance that are expected to be recognised within the next
financial year. Contract liability is recorded under Other accruals
and other liabilities (Note 16).
5. Operating Segment
The CODM assesses operating
segment performance based on operating profit. Segment revenue for
the year ended 31 December 2024 of €145.9 million (2023: €156.9
million) is wholly derived from sales to external
customers.
Entity-wide disclosures
The business is managed on a
worldwide basis but operates manufacturing facilities and sales
offices in Ireland, UK, Sweden, Finland, South Africa, Western
Australia, the United States and Canada and sales offices in ten
other locations including Eastern Australia, South Africa, France,
Spain, Namibia, Sweden, Chile and Peru. In presenting information
on geography, revenue is based on the geographical location of
customers and non-current assets based on the location of these
assets.
5. Operating Segment (continued)
Revenue by region (by location of
customers):
|
2024
|
2023
|
|
€'000
|
€'000
|
Region:
|
|
|
Ireland
|
2,161
|
1,619
|
Americas
|
59,481
|
66,466
|
Australasia
|
17,938
|
14,344
|
Europe, Middle East,
Africa
|
66,286
|
74,502
|
Total revenue (1)
|
145,866
|
156,931
|
(1) Total revenue in 2024 includes revenue from discontinued
operations.
During 2024, Mincon had sales in
the USA of €33.4 million (2023: €38.4 million), Canada of €16.9
million (2023: €15.5) and Australia of €15 million (2023: €12
million), these individually contributed to more than 10% of the
entire Group's sales for 2024.
|
|
|
|
2024
|
2023
|
|
€'000
|
€'000
|
Region:
|
|
|
Americas
|
16,088
|
16,352
|
Australasia
|
10,167
|
11,060
|
Europe, Middle East,
Africa
|
64,789
|
67,976
|
Total non-current assets(1)
|
91,044
|
95,388
|
(1) Non-current assets exclude deferred tax
assets.
|
|
|
|
|
|
|
|
During 2024, Mincon held
non-current assets (excluding deferred tax assets) in Ireland of
€23.2 million (2023: €23.5 million), in the USA of €12.2 million
(2023: €11.7 million) these separately contributed to more than 10%
of the entire Group's non-current assets (excluding deferred tax
assets) for 2024.
|
|
|
|
2024
|
2023
|
|
€'000
|
€'000
|
Region:
|
|
|
Americas
|
4,900
|
5,883
|
Australasia
|
2,041
|
1,988
|
Europe, Middle East,
Africa
|
18,855
|
21,091
|
Total non-current liabilities(1)
|
25,796
|
28,962
|
(1) Non-current liabilities exclude deferred tax
liabilities.
|
|
|
|
|
|
|
|
During 2024, Mincon held
non-current liabilities (excluding deferred tax liabilities) in
Ireland of €13.6 million (2023: €15.7 million), this contributed to
more than 10% of the entire Group's non-current liabilities
(excluding deferred tax liabilities) for 2024.
6. Cost of Sales and operating
expenses
Included within cost of sales and
operating costs were the following major components:
|
|
|
Cost of sales
|
|
|
|
2024
|
2023
|
|
€'000
|
€'000
|
Raw materials
|
43,326
|
46,201
|
Third party product
purchases
|
22,081
|
22,194
|
Employee costs
|
19,591
|
20,980
|
Depreciation (note 13)
|
5,416
|
5,387
|
In bound costs on
purchases
|
3,527
|
3,200
|
Energy costs
|
2,623
|
2,735
|
Maintenance of machinery
|
1,498
|
1,529
|
Subcontracting
|
4,355
|
4,884
|
Amortisation of product
development
|
485
|
485
|
Other
|
2,905
|
3,813
|
Total cost of sales (1)
|
105,807
|
111,408
|
(1) Total cost of sales in 2024 includes cost of sales from
discontinued operations.
The Group invested approximately
€3.8 million on research and development projects in 2024 (2023:
€4.1 million) €3.8 million of this has been expensed in the period
(2023: €4.1 million).
Operating costs
|
|
|
|
2024
|
2023
|
|
€'000
|
€'000
|
Employee costs (including Director
emoluments)
|
19,770
|
19,726
|
Depreciation (note 13)
|
2,497
|
2,610
|
Amortisation of acquired
IP
|
277
|
216
|
Travel
|
2,068
|
1,812
|
Professional costs
|
2,759
|
2,425
|
Administration
|
2,806
|
2,938
|
Marketing
|
740
|
791
|
Legal cost
|
783
|
715
|
Other
|
2,853
|
2,000
|
Total other operating costs (1)
|
34,553
|
33,233
|
(1) Total other operating costs in 2024 includes other
operating costs from discontinued operations.
The Group recognised €92,000 in
Government Grants in 2024 (2023: €56,000). These grants differ in structure from country to country,
they primarily relate to personnel costs.
7. Finance costs
|
2024
|
2023
|
|
€'000
|
€'000
|
Interest on lease
liabilities
|
445
|
698
|
Interest on loans and
borrowings
|
2,046
|
1,774
|
Finance costs (1)
|
2,491
|
2,472
|
(1) Finance costs in 2024 includes finance costs from
discontinued operations.
8. Employee information
|
|
|
|
2024
|
2023
|
|
€'000
|
€'000
|
Wages and salaries - excluding
Directors
|
33,171
|
34,633
|
Wages, salaries, fees and retirement
benefit - Directors (note 10)
|
721
|
725
|
Social security costs
|
2,952
|
3,409
|
Retirement benefit costs of defined
contribution plans
|
2,185
|
2,203
|
Share based payment expense (note
21)
|
332
|
(264)
|
Total employee costs (1)
|
39,361
|
40,706
|
(1) Total employee costs in 2024 includes employee costs from
discontinued operations.
At 31 December 2024, there was
€206,000 (2023: €445,000) accrued for and not in paid pension
contributions.
|
|
|
|
The average number of employees was
as follows:
|
|
|
|
2024
|
2023
|
|
Number
|
Number
|
Sales and distribution
|
123
|
136
|
General and
administration
|
75
|
77
|
Manufacturing, service and
development
|
332
|
391
|
Average number of persons employed
|
530
|
604
|
Retirement benefit and Other Employee Benefit
Plans
The Group operates various defined
contribution retirement benefit plans. During the year ended 31
December 2024, the Group
recorded €2.2 million (2023: €2.2 million) of
expense in connection with these plans.
9. Non-Current Assets Held for Resale and Discontinued
Operations
During 2024, Mincon's Group Board
of Director made the decision to cease trading of its subsidiary
Mincon Carbide in Sheffield UK.
All contracts with customers in
Mincon Carbide were fulfilled and all inventory and portion of the
property and equipment have been sold. As at 31 December 2024, few
employees are still employed to execute outstanding administrative
activities. The Group assessed that Mincon Carbide has ceased to be
used and thus represents a discontinued operation as at the
reporting period.
At
31 December 2024, the property, plant and equipment owned by Mincon
Carbide was in the process of being sold to a third party. The sale
was completed on 17 January 2025 for a total consideration of £1.8
million (€2.2 million).
As at 31 December 2024, the
property, plant and equipment of Mincon Carbide amounting to
€751,000 was reclassified to Non-current assets held for
resale. This balance is made up of land
and buildings of €740,000 and plant & equipment of €11,000
(Note 13). Apart from the property, plant and equipment, no other
major classes of assets and liabilities of Mincon Carbide were
classified as held for sale.
Cashflows generated by Mincon
Carbide for the year ended 31 December 2024 are as
follows:
|
€'000
|
Operating
activities...............................................................................................................................................
|
137
|
Investing
activities................................................................................................................................................
|
241
|
Financing
activities...............................................................................................................................................
|
(699)
|
Opening cash balance
..........................................................................................................................................
|
665
|
Cash flows from discontinued
operations............................................................................................................
|
344
|
10. Statutory and other required
disclosures
Operating profit is stated after
charging the following amounts:
|
2024
|
2023
|
|
€'000
|
€'000
|
Directors' remuneration
|
|
|
Fees
|
235
|
234
|
Wages and salaries
|
426
|
432
|
Retirement benefit
contributions
|
60
|
59
|
Total Directors' remuneration
|
721
|
725
|
Auditor's remuneration
|
2024
€'000
|
2023
€'000
|
Auditor's remuneration - Fees payable to lead audit
firm
|
|
|
Audit of the Group financial
statements
|
195
|
188
|
Audit of the Company financial
statements
|
10
|
10
|
Other assurance services
|
15
|
15
|
|
220
|
213
|
Auditor's remuneration - Fees payable to other firms in lead
audit firm's network
|
|
|
Audit services
|
44
|
36
|
Other assurance services
|
-
|
-
|
Tax advisory services
|
2
|
2
|
Total auditor's remuneration
|
46
|
38
|
11. Income
tax
Tax recognised in income
statement:
|
2024
|
2023
|
Current tax expense
|
€'000
|
€'000
|
Current year
|
1,950
|
1,995
|
Adjustment for prior
years
|
51
|
-
|
Total current tax expense
|
2,001
|
1,995
|
Deferred tax expense
|
|
|
Origination and reversal of
temporary differences
|
(447)
|
(561)
|
Total deferred tax
expense
|
(447)
|
(561)
|
|
|
|
Total income tax expense (1)
|
1,554
|
1,434
|
(1) Total income tax expense in 2024 includes income tax from
discontinued operations.
A reconciliation of the expected
income tax expense is computed by applying the standard Irish tax
rate to the profit before tax and the reconciliation to the actual
income tax expense is as follows:
|
2024
|
2023
|
|
€'000
|
€'000
|
Profit before tax
|
3,320
|
8,904
|
Irish standard tax rate (12.5%)
|
12.5%
|
12.5%
|
Taxes at the Irish standard
rate
|
415
|
1,113
|
Foreign income at rates other than
the Irish standard rate
|
226
|
(462)
|
Losses created/utilised
|
40
|
(61)
|
Other
|
873
|
844
|
Total income tax expense (1)
|
1,554
|
1,434
|
(1) Total income tax expense in 2024 includes income tax from
discontinued operations.
11. Income tax (continued)
The Group's net deferred taxation
liability was as follows:
|
2024
|
2023
|
|
€'000
|
€'000
|
Deferred taxation assets:
|
|
|
Reserves, provisions and tax
credits
|
2,008
|
2,012
|
Tax losses and unrealised FX
gains
|
539
|
652
|
Total deferred taxation
asset
|
2,547
|
2,664
|
Deferred taxation liabilities:
|
|
|
Property, plant and
equipment
|
(1,535)
|
(2,099)
|
Total deferred taxation
liabilities
|
(1,535)
|
(2,099)
|
|
|
|
Net deferred taxation
asset
|
1,012
|
565
|
The movement in temporary
differences during the year were as follows:
|
|
|
|
|
Balance
|
Recognised
in
|
Balance
|
|
1 January
|
Profit or
Loss
|
31
December
|
1
January 2023 - 31 December 2023
|
€'000
|
€'000
|
€'000
|
Deferred taxation assets:
|
|
|
|
Reserves, provisions and tax
credits
|
1,044
|
968
|
2,012
|
Tax losses
|
1,006
|
(354)
|
652
|
Total deferred taxation
asset
|
2,050
|
614
|
2,664
|
Deferred taxation liabilities:
|
|
|
|
Property, plant and
equipment
|
(1,808)
|
(291)
|
(2,099)
|
Profit not yet taxable
|
(238)
|
238
|
-
|
Total deferred taxation
liabilities
|
(2,046)
|
(53)
|
(2,099)
|
|
|
|
|
Net deferred taxation
liability
|
4
|
561
|
565
|
|
Balance
|
Recognised
in
|
Balance
|
|
1 January
|
Profit or
Loss
|
31
December
|
1
January 2024 - 31 December 2024
|
€'000
|
€'000
|
€'000
|
Deferred taxation assets:
|
|
|
|
Reserves, provisions and tax
credits
|
2,012
|
(5)
|
2,007
|
Tax losses
|
652
|
(112)
|
540
|
Total deferred taxation
asset
|
2,664
|
(117)
|
2,547
|
Deferred taxation liabilities:
|
|
|
|
Property, plant and
equipment
|
(2,099)
|
564
|
(1,535)
|
Total deferred taxation
liabilities
|
(2,099)
|
564
|
(1,535)
|
|
|
|
|
Net deferred taxation
liability
|
565
|
447
|
1,012
|
Deferred taxation assets have not
been recognised in respect of the following items:
|
2024
|
2023
|
|
€'000
|
€'000
|
Tax losses
|
3,829
|
3,789
|
Total
|
3,829
|
3,789
|
12. Intangible assets and goodwill
|
Internally generated
intangible asset
|
Goodwill
|
Acquired
intellectual
property
|
Total
|
|
€'000
|
€'000
|
€'000
|
€'000
|
Balance at 1 January 2023
|
7,150
|
32,328
|
631
|
40,109
|
Acquired intellectual
property
|
-
|
-
|
1,517
|
1,517
|
Amortisation of intellectual
property
|
-
|
-
|
(216)
|
(216)
|
Amortisation of product
development
|
(485)
|
-
|
-
|
(485)
|
Translation differences
|
-
|
(278)
|
(22)
|
(300)
|
Balance at 31 December 2023
|
6,665
|
32,050
|
1,910
|
40,625
|
Acquired intellectual
property
|
-
|
-
|
394
|
394
|
Amortisation of intellectual
property
|
-
|
-
|
(277)
|
(277)
|
Amortisation of product
development
|
(485)
|
-
|
-
|
(485)
|
Translation differences
|
-
|
(283)
|
125
|
(158)
|
Balance at 31 December 2024
|
6,180
|
31,767
|
2,152
|
40,099
|
Goodwill relates to the
acquisition of the below companies, being the dates that the Group
obtained control of these business:
· The remaining 60% of DDS-SA Pty Limited in November
2009
· The 60% acquisition of Omina Supplies in August
2014
· The 65% acquisition of Rotacan in August 2014
· The acquisition of ABC products in August 2014
· The acquisition of Ozmine in January 2015
· The acquisition of Mincon Chile in March 2015
· The acquisition of Mincon Tanzania in March 2015
· The acquisition of Premier in November 2016
· The acquisition of Rockdrill Engineering in November
2016
· The acquisition of PPV in April 2017
· The acquisition of Viqing July 2017
· The acquisition of Driconeq in March 2018
· The acquisition of Pacific Bit of Canada in January
2019
· The acquisition of Lehti Group in January 2020
· The acquisition
of Rocdrill in May 2020
· The acquisition of Attakroc in June 2021
· The acquisition of Spartan Drilling Tools in January
2022
The Group accounts for
acquisitions using the purchase accounting method as outlined in
IFRS 3 Business
Combinations.
The recoverable amount of goodwill
has been assessed based on estimates of fair value less costs of
disposal (FVLCD). The FVLCD valuation is calculated on the basis of
a discounted cash flow ("DCF") model. The most significant
assumptions within the DCF are weighted average cost of capital
("WACC"), tax rates and terminal value assumptions. Goodwill
impairment testing did not indicate any impairment during any of
the periods being reported. Four sensitivities are applied as part
of the analysis considering the effects of changes in:
1) the
WACC,
2) the
EBITDA margin,
3) the
long term growth rate and
4) the
level of terminal value capital expenditure.
The sensitivities calculate
downside scenarios to assess potential indications of impairments
due to changes in key assumptions. The results from the sensitivity
analysis did not suggest that goodwill would be impaired when those
sensitivities were applied.
12. Intangible assets and goodwill
(continued)
The carrying amount of the CGU was
determined to be lower than its fair value less costs of disposal
by €9 million (2023: €5.3 million), giving management headroom and
comfort in the above stated impairment assessment.
The key assumptions used in the
estimation of the fair value less cost calculation were as
follows:
|
|
|
|
|
2024
|
2023
|
|
WACC
|
13.55%
|
11.35%
|
|
EBITDA margin
|
17.96%
|
16.18%
|
|
Long term growth rate
|
2.35%
|
2.29%
|
|
Terminal value capital
expenditure
|
€7.2
million
|
€9.8
million
|
|
|
|
|
|
|
|
The WACC calculation considers
market data and data from comparable public companies. Peer group
data was especially considered for the beta factor and assumed
financing structure (gearing level). The analysis resulted in a
discount rate range of 12.5% to 14.6% (2023: 10.15% to 12.55%).
This results in a midpoint WACC being used of 13.55% (2023:
11.35%).
The Long term growth rate of 2.35%
(2023: 2.30%) applied is based on a weighted average of the long
term inflation rates of the countries in which Mincon generates
revenues and earnings.
The budgeted EBITDA was based on
expectations of future outcomes, taking account for past
experience, adjusted for anticipated revenue growth as detailed in
managements approved Budget. No EBITDA margin effect is assumed in
the terminal value i.e. the budgeted EBITDA margin of 18% for 2027
(2023: 16.20% for 2026) is assumed in the Terminal Value
calculation used to arrive at the FVLCD.
Terminal value capital expenditure
assumes no balance sheet growth is assumed in the terminal value,
capital expenditure is assumed to equal depreciation of €7.2
million (2023: €9.8 million).
The following table shows the
amount by which the two assumptions below would need to change to
individually for the estimated recoverable amount to be equal to
the carrying amount.
|
2024
|
2023
|
WACC
|
14.16%
|
11.63%
|
Long term growth rate
|
1.12%
|
1.73%
|
13. Property, plant and equipment
|
Land &
|
Plant
&
|
ROU
|
|
|
Buildings
|
Equipment
|
Assets
|
Total
|
|
€'000
|
€'000
|
€'000
|
€'000
|
Cost:
|
|
|
|
|
At 1 January 2023
|
18,157
|
64,508
|
11,531
|
94,196
|
Additions
|
3,824
|
6,378
|
1,013
|
11,215
|
Disposals and derecognition of ROU
assets
|
-
|
(1,734)
|
(656)
|
(2,390)
|
Foreign exchange
differences
|
(337)
|
(1,029)
|
(292)
|
(1,658)
|
At 31 December 2023
|
21,644
|
68,123
|
11,596
|
101,363
|
|
|
|
|
|
Additions
|
73
|
3,536
|
3,182
|
6,791
|
Transfer of Non-Current Assets Held
for Re-Sale (Note 9).
|
(844)
|
(25)
|
-
|
(869)
|
Disposals and derecognition of ROU
assets
|
-
|
(5,332)
|
(192)
|
(5,524)
|
Foreign exchange
differences
|
136
|
783
|
74
|
993
|
At
31 December 2024
|
21,009
|
67,085
|
14,660
|
102,754
|
|
|
|
|
|
Accumulated depreciation:
|
|
|
|
|
At 1 January 2023
|
(4,242)
|
(32,187)
|
(4,763)
|
(41,192)
|
Charged in year
|
(648)
|
(5,144)
|
(2,205)
|
(7,997)
|
Disposals
|
(10)
|
1,372
|
567
|
1,929
|
Foreign exchange
differences
|
50
|
501
|
109
|
660
|
At 31 December 2023
|
(4,850)
|
(35,458)
|
(6,292)
|
(46,600)
|
|
|
|
|
|
Charged in year
|
(762)
|
(5,081)
|
(2,070)
|
(7,913)
|
Transfer of Non-Current Assets Held
for Re-Sale (Note 9)
|
104
|
14
|
-
|
118
|
Disposals
|
-
|
2,994
|
192
|
3,186
|
Foreign exchange
differences
|
(62)
|
(495)
|
(43)
|
(600)
|
At
31 December 2024
|
(5,570)
|
(38,026)
|
(8,213)
|
(51,809)
|
|
|
|
|
|
Carrying amount: 31 December 2024
|
15,439
|
29,059
|
6,447
|
50,945
|
Carrying amount: 31 December
2023
|
16,794
|
32,665
|
5,304
|
54,763
|
Carrying amount: 1 January
2023
|
13,915
|
32,321
|
6,768
|
53,004
|
ROU assets includes Property of
€5.5 million (2023: €4.2 million) and Plant and Equipment of
€967,000 (2023: €1.1 million).
The depreciation charge for
property, plant and equipment is recognised in the following line
items in the income statement:
|
|
|
|
2024
|
2023
|
|
€'000
|
€'000
|
Cost of sales
|
4,971
|
4,994
|
Cost of sales ROU assets
|
445
|
393
|
Operating expenses
|
872
|
830
|
Operating expenses ROU
asset
|
1,625
|
1,780
|
Total depreciation charge for
property, plant and equipment
|
7,913
|
7,997
|
14. Inventory and capital equipment
|
2024
|
2023
|
|
€'000
|
€'000
|
Finished goods
|
44,807
|
45,953
|
Work-in-progress
|
9,309
|
9,060
|
Raw materials
|
13,219
|
14,717
|
Total inventory
|
67,335
|
69,730
|
The Group recorded an impairment
of €NIL against inventory to take account of net realisable value
during the year ended 31 December 2024 (2023: €87,000). Write-downs
are included in cost of sales.
15. Trade and other receivables and other current
assets
a) Trade and other
receivables
|
2024
|
2023
|
|
€'000
|
€'000
|
Gross receivable
|
26,165
|
23,129
|
Provision for impairment
|
(1,685)
|
(1,513)
|
Net trade and other
receivables
|
24,480
|
21,616
|
|
Provision for
impairment
|
|
€'000
|
Balance at 1 January 2024
|
(1,513)
|
Decrease in provision arising from
prior years receivables impairment
|
30
|
Increase in ECL model
|
(202)
|
Balance at 31 December
2024
|
(1,685)
|
The following table provides the
information about the exposure to credit risk and ECL's for trade
receivables as at 31 December
2024.
|
Weighted average loss rate
%
|
Gross carrying amount
€'000
|
Loss
allowance
€'000
|
Current (not past due)
|
2%
|
16,800
|
374
|
1-30 days past due
|
12%
|
3,825
|
459
|
31-60 days past due
|
19%
|
1,793
|
340
|
61 to 90 days
|
11%
|
3,624
|
389
|
More than 90 days past
due
|
100%
|
123
|
123
|
Net trade and other
receivables
|
|
26,165
|
1,685
|
The following table provides the
information about the exposure to credit risk and ECL's for trade
receivables as at 31 December
2023.
|
Weighted average loss rate
%
|
Gross carrying amount
€'000
|
Loss
allowance
€'000
|
Current (not past due)
|
2%
|
15,924
|
280
|
1-30 days past due
|
9%
|
3,145
|
275
|
31-60 days past due
|
22%
|
1,538
|
345
|
61 to 90 days
|
15%
|
2,250
|
341
|
More than 90 days past
due
|
100%
|
272
|
272
|
Net trade and other
receivables
|
|
23,129
|
1,513
|
15. Trade and other receivables and other current
assets (continued)
b) Prepayments and other
current assets
|
|
|
|
2024
|
2023
|
|
€'000
|
€'000
|
Plant and machinery prepaid and
under commission
|
5,736
|
6,607
|
Prepayments and other current
assets
|
4,037
|
2,002
|
Prepayments and other current
assets
|
9,773
|
8,609
|
16. Trade creditors, accruals and other
liabilities
|
2024
|
2023
|
|
€'000
|
€'000
|
Trade creditors
|
9,170
|
10,505
|
Total creditors and other payables
|
9,170
|
10,505
|
|
2024
|
2023
|
|
€'000
|
€'000
|
VAT
|
351
|
664
|
Social security costs
|
1,299
|
1,810
|
Other accruals and
liabilities
|
6,445
|
6,122
|
Total accruals and other liabilities
|
8,095
|
8,596
|
17. Capital management
The Group's policy is to have a
strong capital base in order to maintain investor, creditor and
market confidence and to sustain future development of the
business. Management monitors the return on capital, as well as the
level of dividends to ordinary shareholders.
The Board of Directors seeks to
maintain a balance between the higher returns that might be
possible with higher levels of borrowing and the advantages and
security afforded by a sound capital position.
The Group monitors capital using a
ratio of 'net debt' to equity. Net debt is calculated as total
liabilities less cash and cash equivalents (as shown in the
statement of financial position).
|
2024
|
2023
|
|
€'000
|
€'000
|
Total liabilities
|
(59,127)
|
(65,245)
|
Less: cash and cash
equivalents
|
15,027
|
20,482
|
Net
debt
|
(44,100)
|
(44,763)
|
Total equity
|
152,315
|
154,251
|
Net
debt to equity ratio
|
0.29
|
0.29
|
18. Loans and borrowings
|
|
2024
|
2023
|
|
Maturity
|
€'000
|
€'000
|
Bank loans
|
2025-2036
|
29,802
|
32,486
|
Lease Liabilities
|
2025-2032
|
7,881
|
7,626
|
Total loans and borrowings
|
|
37,683
|
40,112
|
Current
|
|
13,913
|
14,080
|
Non-current
|
|
23,770
|
26,032
|
The Group has a number of bank
loans and lease liabilities with a mixture of variable and fixed
interest rates. The Group has not been in default on any of these
debt agreements during any of the periods presented. The loans are
secured against the assets for which they have been drawn down
for.
The Group has been in compliance
with all debt agreements during the periods presented. The loan
agreements in Ireland of €12.5 million (2023: €14.5 million) carry
restrictive financial covenants. During 2024, the restrictive
covenants have been updated to EBITDA to be no less than €12
million at end of 31 December 2024.
Interest rates on current
borrowings are at an average rate of 5.51% (2023:
5.12%).
During 2024, the Group availed of
the option to enter into overdraft facilities and to draw down
loans of €2.2 million (2023: €7.2 million), €1.5 million (2023:
€6.9 million) in loans and €650,000 (2023: €300,000) in overdraft
facilities.
Loans are repayable in line with
their specific terms, the Group has one bullet repayment due in
2026 of €5 million.
Reconciliation of movements of
liabilities to cash flows arising from financing
activities
|
Balance at 1 January
2023
|
Arising from
acquisition
|
Cash
movements
|
Non-cash
movements
|
Foreign exchange
differences
|
Balance at 31 December
2023
|
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
Loans and borrowings
|
30,848
|
-
|
1,873
|
-
|
(235)
|
32,486
|
Lease liabilities
|
11,096
|
-
|
(4,194)
|
1,018
|
(294)
|
7,626
|
Total
|
41,944
|
-
|
(2,321)
|
1,018
|
(529)
|
40,112
|
|
Balance at 1 January
2024
|
Arising from
acquisition
|
Cash
movements
|
Non-cash
movements
|
Foreign exchange
differences
|
Balance at 31 December
2024
|
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
Loans and borrowings
|
32,486
|
-
|
(2,826)
|
-
|
142
|
29,802
|
Lease liabilities
|
7,626
|
-
|
(3,026)
|
3,219
|
62
|
7,881
|
Total
|
40,112
|
-
|
(5,852)
|
3,219
|
204
|
37,683
|
|
|
|
|
2024 Interest rate
range
|
2024 Effective interest
rate
|
Bank loans
|
1% -
16%
|
5.30%
|
Lease Liabilities
|
1% -
17%
|
5.81%
|
|
2023 Interest rate
range
|
2023 Effective interest
rate
|
Bank loans
|
1% -
16%
|
5%
|
Lease Liabilities
|
3% -
17%
|
5.41%
|
19. Share capital and reserves
At
31 December 2023
|
|
|
|
|
|
Authorised Share Capital
|
Number
|
€000
|
Ordinary Shares of €0.01
each
|
500,000,000
|
5,000
|
Allotted, called-up and fully paid
up shares
|
Number
|
€000
|
Ordinary Shares of €0.01
each
|
212,472,413
|
2,125
|
|
2024
|
2023
|
Opening Share Capital
|
212,472,413
|
212,472,413
|
Share Awards vested during
year
|
-
|
-
|
Authorised Share Capital
|
212,472,413
|
212,472,413
|
Share issuances
On 26 November 2013, Mincon Group
plc was admitted to trading on the Euronext Growth and the
Alternative Investment Market (AIM) of the London Stock
Exchange.
|
Voting rights
The holders of Ordinary Shares have
the right to receive notice of and attend and vote at all general
meetings of the Company and they are entitled, on a poll or a show
of hands, to one vote for every Ordinary Share they hold.
Votes at general meetings may be given either
personally or by proxy. Subject to the Companies Act and any
special rights or restrictions as to voting attached to any shares,
on a show of hands every member who (being an individual) is
present in person and every proxy and every member (being a
corporation) who is present by a representative duly authorised,
shall have one vote, so, however, that no individual shall have
more than one vote for every share carrying voting rights and on a
poll every member present in person or by proxy shall have one vote
for every share of which he is the holder.
|
Dividends
In June 2024, Mincon Group plc
paid a final dividend for 2023 of €0.0105 (1.05 cent) per ordinary
share (€2.2 million).
In December 2024, Mincon Group plc
paid an interim dividend in the amount of €0.0105 (1.05 cent) per
ordinary share (€2.2 million total payment), which was paid to
shareholders on the register at the close of business on 15
November 2024.
The Directors recommend the
payment of a final dividend of €0.0105 (1.05 cent) per share for
the year ended 31 December 2024 (31 December 2023: 1.05 cent per
share).
Share premium and other reserves
As part of a Group reorganisation
of the Company, Mincon Group plc, became the ultimate parent entity
of the Group. On 30 August 2013, the Company acquired 100% of the
issued share capital in Smithstown Holdings and acquired (directly
or indirectly) the shareholdings previously held by Smithstown
Holdings in each of its subsidiaries, thereby creating a merger
reserve.
20. Earnings per share
Basic earnings per share (EPS) is
computed by dividing the profit for the period available to
ordinary shareholders by the weighted average number of Ordinary
Shares outstanding during the period. Diluted earnings per share is
computed by dividing the profit for the period by the weighted
average number of Ordinary Shares outstanding and, when dilutive,
adjusted for the effect of all potentially dilutive shares. The
following table sets forth the computation for basic and diluted
net profit per share for the years ended
31 December:
20. Earnings per share (continued)
|
2024
|
2023
|
Numerator (amounts in €'000):
|
|
|
Profit attributable to owners of the
Parent
|
1,766
|
7,470
|
Denominator (Number):
Basic shares outstanding
|
Restricted share awards
|
Diluted weighted average shares
outstanding
|
|
|
212,472,413
|
212,472,413
|
3,640,000
|
830,000
|
216,112,414
|
213,302,413
|
Earnings per Ordinary Share
|
|
|
Basic earnings per share,
€
Diluted earnings per share,
€
|
0.83
0.82
|
3.52
3.50
|
Earnings per Ordinary Share
|
2024
|
2024
|
2024
|
2023
|
Continued
Operations
|
Discontinued
Operation
|
Total
|
Total
|
Profit attributable to owners of the
Parent
|
3,392
|
(1,626)
|
1,766
|
7,470
|
Basic earnings per share,
€
|
1.60
|
(0.77)
|
0.83
|
3.52
|
Diluted earnings per share,
€
|
1.57
|
(0.75)
|
0.82
|
3.50
|
21. Share based payment
The vesting conditions of the
scheme state that the minimum growth in EPS shall be CPI plus 5%
per annum, compounded annually, over the relevant three accounting
years up to the share award of 100% of the participants
basic salary. Where awards have
been granted to a participant in excess of 100% of their basic
salary, the performance condition for the element that is in excess
of 100% of basic salary is that the minimum growth in EPS shall be
CPI plus 10% per annum, compounded annually, over the three
accounting years.
Reconciliation of outstanding share options
|
Number of
Awards
in thousands
2024
|
Number of
Awards
in thousands
2023
|
Outstanding on 1 January
|
830
|
-
|
Forfeited during the year
|
(50)
|
(40)
|
Exercised during the year
|
-
|
-
|
Granted during the year
|
-
|
870
|
Outstanding at 31 December
|
780
|
830
|
Reconciliation of outstanding share awards
|
Number of
Options
in thousands
2024
|
Number of
Options
in thousands
2023
|
Outstanding on 1 January
|
-
|
2,030
|
Forfeited during the year
|
-
|
(2,030)
|
Exercised during the year
|
-
|
-
|
Granted during the year
|
2,860
|
-
|
Outstanding at 31 December
|
2,860
|
-
|
21. Share based payment (continued)
LTIP Scheme
|
Conditional Award at Grant Date
|
Conditional Option Invitation
date
|
April
2024
|
Year of Potential
vesting
|
2027/2031
|
Share price at grant
date
|
€0.52
|
Exercise price per share/share
options
|
€0.52
|
Expected Volatility
|
40.67%
|
Expected life
|
7
years
|
Risk free rate
|
2.29%
|
Expected dividend yield
|
3.32%
|
Fair value at grant
date
|
€0.16
|
Valuation model
|
Black
& Scholes Model
|
The expected volatility was based on
the standard deviation of the Company's historical price returns
(weekly observations) over a period corresponding to the expected
life of the options.
22. Financial risk management
The Group is exposed to various
financial risks arising in the normal course of business. Its
financial risk exposures are predominantly related to changes in
foreign currency exchange rates and interest rates, as well as the
creditworthiness of our counterparties.
The Company's Board of Directors
has overall responsibility for the establishment and oversight of
the Group's risk management framework. The Group's risk management
policies are established to identify and analyse the risks faced by
the Group, to set appropriate risk limits and controls and to
monitor risks and adherence to limits. Risk management policies and
systems are reviewed regularly to reflect changes in market
conditions and the Group's activities. The Group, through its
training and management standards and procedures, aims to maintain
a disciplined and constructive control environment in which all
employees understand their roles and obligations.
The Group audit committee oversees
how management monitors compliance with the Group's risk management
policies and procedures, and reviews the adequacy of the risk
management framework in relation to the risks faced by the
Group.
The Group defines liquid resources
as the total of its cash, cash equivalents and short term deposits.
Capital is defined as the Group's shareholders' equity and
borrowings.
The Group's objectives when
managing its liquid resources are:
•
To maintain adequate liquid resources to fund its ongoing
operations and safeguard its ability to continue as a going
concern, so that it can continue to create value for investors;
•
To have available the necessary financial resources to allow it to
invest in areas that may create value for
shareholders; and
•
To maintain sufficient financial resources to mitigate against
risks and unforeseen events.
|
Liquid and capital resources are
monitored on the basis of the total amount of such resources
available and the Group's anticipated requirements for the
foreseeable future. The Group's liquid resources and shareholders'
equity as at 31 December 2024 and 31 December 2023 were as
follows:
|
2024
|
2023
|
|
€'000
|
€'000
|
Cash and cash equivalents
|
15,027
|
20,482
|
Loans and borrowings
|
37,683
|
40,112
|
Shareholders' equity
|
152,315
|
154,251
|
22. Financial risk management
(continued)
a) Liquidity and capital (continued)
The Group frequently assess its
liquidity requirements, together with this requirement and the rate
return of long term euro deposits, the Group has decided to keep
all cash readily available that is accessible within a month or
less. Cash at bank earns interest at floating rates based on daily
bank deposits. The fair value of cash and cash equivalents equals
the carrying amount.
Cash and cash equivalents are held
by major Irish, European, United States, Canadian and Australian
institutions with credit rating of A3 or better. The Company
deposits cash with individual institutions to avoid concentration
of risk with any one counterparty. The Group has also engaged the
services of a depository to ensure the security of the cash
assets.
Risk of counterparty default
arising on cash and cash equivalents and derivative financial
instruments is controlled by dealing with high-quality institutions
and by policy, limiting the amount of credit exposure to any one
bank or institution.
At year-end, the Group's total
cash and cash equivalents were held in the following
jurisdictions:
|
31
December
|
31
December
|
|
2024
|
2023
|
|
€'000
|
€'000
|
Ireland
|
666
|
2,088
|
Americas
|
4,471
|
3,517
|
Australasia
|
1,098
|
657
|
Europe, Middle East,
Africa
|
8,792
|
14,220
|
Total cash, cash equivalents and
short term deposits
|
15,027
|
20,482
|
There are currently no
restrictions that would have a material adverse impact on the Group
in relation to the intercompany transfer of cash held by its
foreign subsidiaries. The Group continually evaluates its liquidity
requirements, capital needs and availability of resources in view
of, among other things, alternative uses of capital, the cost of
debt and equity capital and estimated future operating cash
flow.
In the normal course of business,
the Group may investigate, evaluate, discuss and engage in future
company or product acquisitions, capital expenditures, investments
and other business opportunities. In the event of any future
acquisitions, capital expenditures, investments or other business
opportunities, the Group may consider using available cash or
raising additional capital, including the issuance of additional
debt. The maturity of the contractual undiscounted cash flows
(including estimated future interest payments on debt) of the
Group's financial liabilities as at 31 December were as
follows:
|
|
|
|
|
|
|
|
Total Current
Value of
|
Total Undiscounted
contractual
|
Less than
|
|
|
More than
|
|
Cash Flows
|
Cash Flows
|
1 Year
|
1-3 Years
|
3-5 Years
|
5 Years
|
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
At
31 December 2023:
|
|
|
|
|
|
|
Deferred consideration
|
1,998
|
2,045
|
442
|
1,603
|
-
|
-
|
Loans and borrowings
|
32,486
|
33,124
|
11,212
|
6,738
|
14,520
|
654
|
Lease liabilities
|
7,626
|
7,769
|
2,869
|
3,061
|
963
|
876
|
Trade and other payables
|
10,505
|
10,505
|
10,505
|
-
|
-
|
-
|
Accrued and other financial
liabilities
|
8,596
|
8,596
|
8,596
|
-
|
-
|
-
|
Total at 31 December 2023
|
61,211
|
62,039
|
33,624
|
11,402
|
15,483
|
1,530
|
At
31 December 2024:
|
|
|
|
|
|
|
Deferred consideration
|
1,641
|
1,670
|
680
|
495
|
495
|
-
|
Loans and borrowings
|
29,802
|
30,357
|
11,295
|
13,358
|
4,950
|
754
|
Lease liabilities
|
7,881
|
8,039
|
2,617
|
2,998
|
1,825
|
599
|
Trade and other payables
|
9,170
|
9,170
|
9,170
|
-
|
-
|
-
|
Accrued and other financial
liabilities
|
8,095
|
8,095
|
8,095
|
-
|
-
|
-
|
Total at 31 December 2024
|
56,589
|
57,331
|
31,857
|
16,851
|
7,270
|
1,353
|
|
|
|
|
|
|
|
|
22. Financial risk management
(continued)
b) Foreign currency
risk
The Group is a multinational
business operating in a number of countries and the euro is the
presentation currency. The Group, however, does have revenues,
costs, assets and liabilities denominated in currencies other than
euro.
|
Transactions in foreign currencies
are recorded at the exchange rate prevailing at the date of the
transaction. The resulting monetary assets and liabilities are
translated into the appropriate functional currency at exchange
rates prevailing at the reporting date and the resulting gains and
losses are recognised in the income statement. The Group manages
some of its transaction exposure by matching cash inflows and
outflows of the same currencies. The Group does not engage in
hedging transactions and therefore any movements in the primary
transactional currencies will impact profitability. The Group
continues to monitor the appropriateness of this policy.
Foreign currency denominated
financial assets and liabilities which expose the Group to currency
risk are disclosed below. The amounts shown are those reported to
key management translated into EURO at the closing rate:
|
Short-term
exposure
|
Long-term
debt
|
|
|
USD
|
SEK
|
ZAR
|
USD
|
SEK
|
ZAR
|
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
At
31 December 2024:
|
|
|
|
|
|
|
Financial assets
|
28,004
|
11,370
|
10,196
|
-
|
-
|
-
|
Financial
liabilities
|
(3,054)
|
(1,880)
|
(1,119)
|
(2,645)
|
(642)
|
(333)
|
Total Exposure
|
24,950
|
9,490
|
9,077
|
(2,645)
|
(642)
|
(333)
|
|
|
|
|
|
|
|
At
31 December 2023:
|
|
|
|
|
|
|
Financial assets
|
27,756
|
13,387
|
9,675
|
-
|
-
|
-
|
Financial
liabilities
|
(3,666)
|
(2,235)
|
(1,386)
|
(3,010)
|
(892)
|
(764)
|
Total Exposure
|
24,090
|
11,152
|
8,289
|
(3,010)
|
(892)
|
(764)
|
|
|
|
|
|
|
|
|
|
The following table illustrates
the sensitivity of profit and equity in relating to the Group's
financial assets and financial liabilities and the USD/EUR exchange
rate, SEK/EUR exchange rate and ZAR/EUR exchange rate 'all other
things being equal'.
It assumes a +/- 3% change of the
EUR/USD exchange rate for the year ended as at 31 December 2024
(2023: 1%).
A +/- 1% change is considered for
the EUR/SEK exchange rate (2023: 2%).
It assumes a +/- 2% change of the
EUR/ZAR exchange rate for the year ended as at 31 December 2024
(2023: 8%).
Both of these percentages have
been determined based on the average market volatility in exchange
rates in the previous twelve months.
|
Profit for the
year
|
Equity
|
|
USD
|
SEK
|
ZAR
|
USD
|
SEK
|
ZAR
|
|
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
|
31 December 2024
|
(34)
|
19
|
12
|
566
|
243
|
210
|
|
31 December 2023
|
(10)
|
34
|
54
|
194
|
499
|
722
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the
year
|
Equity
|
|
USD
|
SEK
|
ZAR
|
USD
|
SEK
|
ZAR
|
|
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
€'000
|
|
31 December 2024
|
36
|
(19)
|
(12)
|
(601)
|
(248)
|
(219)
|
|
31 December 2023
|
10
|
(36)
|
(64)
|
(198)
|
(519)
|
(847)
|
|
|
|
|
|
|
|
|
|
|
22. Financial risk management
(continued)
b) Foreign currency
risk
The Group has material
subsidiaries with a functional currency other than the euro, such
as US dollar, Australian dollar, South African rand, and Swedish
krona. Changes in the exchange rate year on year between the
reporting currencies of these operations and the Euro, have an
impact on the Group's consolidated reported result.
The Group's worldwide presence
creates currency volatility, as reported in the Group's results,
when compared year on year. During 2024, the currencies that the
Group trades with were volatile due to local economic performances
and geopolitical issues. As a result, all major currencies that we
trade in weekend against the euro in 2024.
In 2024, 57% (2023: 56%) of
Mincon's revenue €146 million (2023: €157 million) was generated in
AUD, SEK and USD. The majority of the Group's manufacturing base
has a euro, US dollar or Swedish Krona cost base. While management
makes every effort to reduce the impact of this currency
volatility, it is impossible to eliminate or significantly reduce
given the fact that the highest grades of our key raw materials are
either not available or not denominated in these markets and
currencies. Additionally, the ability to increase prices for our
products in these jurisdictions is limited by the current market
factors.
The Group is also exposed to
foreign currency risk on its liquid resources (cash) as shown in
the table below.
|
2024
|
2023
|
Currency
|
Amount in Local
currency
'000
|
Euro (€)
equivalent
'000
|
Local currency
amount
'000
|
Euro(€)
equivalent
€'000
|
US Dollar
|
USD3,300
|
3,200
|
USD4,200
|
3,800
|
Swedish Krona
|
SEK32,600
|
2,800
|
SEK38,800
|
3,500
|
Canadian Dollar
|
CAD2,900
|
1,900
|
CAD1,400
|
973
|
South African Rand
|
ZAR18,300
|
934
|
ZAR21,500
|
1,100
|
The Euro exchange rates used by
the Group in 2024 and 2023 are as follows:
|
2024
|
2023
|
Euro exchange rates
|
Closing
|
Average
|
Closing
|
Average
|
US Dollar
|
1.04
|
1.08
|
1.10
|
1.08
|
Australian Dollar
|
1.67
|
1.64
|
1.62
|
1.63
|
South African Rand
|
19.55
|
19.81
|
20.18
|
19.94
|
Swedish Krona
|
11.46
|
11.43
|
11.13
|
11.47
|
c) Credit risk
Credit risk is the risk that the
possibility that the Group's customers may experience financial
difficulty and be unable to meet their obligations. The Group
monitors its collection experience on a monthly basis and ensures
that a stringent policy is adopted to provide for all past due
amounts. The majority of the Group's customers are third party
distributors and end users of drilling tools and
equipment.
Credit risk management
The credit risk is managed on a
group basis based on the Group's credit risk management policies
and procedures.
The credit risk in respect of cash
balances held with banks and deposits with banks are managed via
diversification of bank deposits, and are only with major reputable
financial institutions.
The Group continuously monitors
the credit quality of customers. Where available, external credit
ratings and/or reports on customers are obtained and used.
The credit terms range between 30 and 90 days.
The credit terms for customers as negotiated with customers are
subject to an internal approval. The ongoing credit risk is managed
through regular review of ageing analysis.
Trade receivables consist of a
large number of customers in various industries and geographical
areas.
22. Financial risk management
(continued)
c) Credit risk
(continued)
Trade receivables and contract assets
The Group applies the IFRS 9
simplified model of recognising lifetime expected credit losses for
all trade receivables as these items do not have a significant
financing component.
In measuring the expected credit
losses, the trade receivables have been assessed on a collective
basis as they possess shared credit risk characteristics. They have
been grouped based on the days past due and also according to the
geographical location of customers.
Trade receivables are written off
(i.e. derecognised) when there is no reasonable expectation of
recovery. Failure to make payments within 180 days from the invoice
date and failure to engage with the Group on alternative payment
arrangement amongst other is considered indicators of no reasonable
expectation of recovery.
The closing balance of the trade
receivables loss allowance as at 31 December 2024 reconciles with
the trade receivables loss allowance opening balance as
follows:
|
Trade
receivables
|
|
€'000
|
Opening loss allowance as at 1
January 2023
|
1,103
|
Loss allowance recognised during the
year
|
410
|
Loss allowance as at 31 December 2023
|
1,513
|
Loss allowance recognised during the
year
|
172
|
Loss allowance as at 31 December 2024
|
1,685
|
Expected credit loss
assessment
The Group allocates each exposure
to a credit risk grade based on data that is determined to be
predictive of the risk of loss and applying experienced credit
judgement. Credit risk grades are defined using quantitative
factors that are indicative of the risk of default and are aligned
to past experiences. Loss rates are based on accrual credit loss
experience over the past five years.(Note 15)
The maximum exposure to credit
risk for trade and other receivables at 31 December 2024 and 31
December 2023 by geographic region was as follows:
|
2024
|
2023
|
|
€'000
|
€'000
|
Americas
|
8,617
|
8,704
|
Australasia
|
1,957
|
1,900
|
Europe, Middle East,
Africa
|
13,906
|
11,012
|
Total amounts owed
|
24,480
|
21,616
|
d) Interest rate
risk
Interest Rate Risk on financial liabilities
Interest rates continued to
increase during 2024, while not at the rate in 2023 we still could
see the impact due to the various fixed loans that we entered into
in 2024. While the variable rates decreased from Q3 2024 onwards,
there was little movement in the income statement compared to
2023.
Interest Rate Risk on cash and cash
equivalents
Our exposure to interest rate risk
on cash and cash equivalents is actively monitored and managed, the
rate risk on cash and cash equivalents is not considered material
to the Group
|
22. Financial risk management
(continued)
e) Fair values
Fair value is the amount at which
a financial instrument could be exchanged in an arms-length
transaction between informed and willing parties, other than in a
forced or liquidation sale. The contractual amounts payable less
impairment provision of trade receivables, trade payables and other
accrued liabilities approximate to their fair values.
Financial assets and financial
liabilities measured at fair value in the consolidated statement of
financial position are grouped into three levels of a fair value
hierarchy. The three levels are defined based on the observability
of significant inputs to the measurement, as follows:
• Level 1: quoted prices
(unadjusted) in active markets for identical assets or
liabilities
• Level 2: inputs other than
quoted prices included within Level 1 that are observable for the
asset
or liability, either
directly or indirectly
• Level 3: unobservable inputs for
the asset or liability.
Mincon Group plc only apply level
3 for fair value, using the detail displayed above.
Deferred consideration
The movements in respect of the
deferred consideration value in the year to 31 December 2024 are as
follows:
|
|
|
Level 3
|
|
€'000
|
Balance at 1 January 2024
|
1,998
|
Arising on acquisition
|
-
|
Cash payment
|
(452)
|
Foreign currency translation
adjustment
|
93
|
Unwinding of discount on deferred
consideration
|
2
|
Balance at 31 December 2024
|
1,641
|
Deferred consideration includes
multiple deferred payments for prior acquisitions over a fixed
period of time. These carry no significant observational
inputs.
23. Subsidiary
undertakings
At 31 December 2024,
the Group had the
following subsidiary undertakings:
Company
|
Group
Share %*
|
Registered Office
&
Country of
Incorporation
|
Mincon International
Limited
|
100%
|
Smithstown, Shannon, Co. Clare,
Ireland
|
Manufacturer of rock drilling
equipment
|
|
|
|
|
|
Mincon Rockdrills PTY
Ltd
|
100%
|
8 Fargo Way, Welshpool, WA 6106,
Australia
|
Manufacturer of rock drilling
equipment
|
|
|
|
|
|
1676427 Ontario Inc. (Operating as
Mincon Canada)
|
100%
|
400B Kirkpatrick Street, North
Bay,
Ontario, P1B 8G5, Canada
|
Manufacturer of rock drilling
equipment
|
|
|
|
|
Mincon Carbide Ltd
|
100%
|
Windsor St, Sheffield S4 7WB,
United Kingdom
|
Manufacturer of tungsten
carbide
Note 9
|
|
|
|
|
|
Mincon Inc.
|
100%
|
109 Norfolk Ave SW,Suite 3,
Roanoke, VA 24011, USA
|
Sales company
|
|
|
|
|
Mincon Sweden AB
|
100%
|
Industrivagen 2-4, 61202 Finspang,
Sweden
|
Sales company
|
|
|
|
|
|
Mincon Nordic OY
|
100%
|
Menotie 1, 33470 YLÖJÄRVI,
Pirkanmaa Finland.
|
Sales company
|
|
|
|
|
|
Mincon Holdings Southern Africa
(Pty)
|
100%
|
Cnr. Harriet Ave. & James
Bright Ave. Driehoek, Gauteng, RSA
|
Sales company
|
|
|
|
|
|
Mincon Australia Pty Ltd
|
100%
|
2/57 Alexandra Street, North
Rockhampton, Queensland, 4701 Australia
|
Sales company
|
|
|
|
|
Mincon West Africa SL
|
100%
|
Calle Adolfo Alonso Fernández, s/n,
Parcela P-16, Zona Franca de Gran Canaria, Puerto de la Luz,
Código Postal 35008, Las Palmas de Gran Canaria, Spain
|
Sales company
|
|
|
|
|
Mincon Poland
|
100%
|
ul.Mickiewicza 32, 32-050 Skawina,
Poland
|
Dormant company
|
|
|
|
|
|
Mincon Canada - Western Service
Centre (previously Pacific Bit of Canada)
|
100%
|
3568-191 Street, Unit 101, Surrey
BC, V3Z 0P6, Canada
|
Sales company
|
|
|
23. Subsidiary undertakings (continued)
|
|
|
Company
|
Group
Share %*
|
Registered Office
&
Country of
Incorporation
|
|
|
|
Mincon Rockdrills Ghana
Limited
|
100%
|
C1, Alfesco Estate, Okpoi Gonno,
Accra, Ghana. GZ-190-5540
|
Dormant company
|
|
|
|
|
Mincon S.A.C.
|
100%
|
Calle La Arboleda 151, Dpto 201, La
Planicie, La Molina, Peru
|
Sales company
|
|
|
|
|
Ozmine International Pty
Limited
|
100%
|
Gidgegannup, WA 6083,
Australia
|
Dormant company
|
|
|
|
|
Mincon Chile
|
100%
|
Américo Vespucio 1385, Módulo 31
Quilicura, Santiago, Chile
|
Sales company
|
|
Mincon Namibia Pty Ltd
|
100%
|
Unit 402, 4th Floor,
Frans Indongo Gardens, Dr FA Indongo Street, Windhoek,
Naminia
|
Sales company
|
|
|
|
|
|
Mincon Mining Equipment
Inc
|
100%
|
808 Nelson Street, Suite 1008,
Vancouver, BC V6Z 2H2
|
Sales company
|
|
|
|
|
Mincon Exports USA Inc.
|
100%
|
109 Norfolk Ave SW,Suite 3, Roanoke,
VA 24011, USA
|
Group finance company
|
|
|
|
|
Mincon International
Shannon
|
100%
|
Smithstown, Shannon, Co. Clare,
Ireland
|
Dormant company
|
|
|
|
|
|
Smithstown Holdings
|
100%
|
Smithstown, Shannon, Co. Clare,
Ireland
|
Holding company
|
|
|
Mincon Canada Drilling Products
Inc.
|
100%
|
400 Kirkpatrick St, North Bay, ON
P1B 8655
|
Holding company
|
|
MGP Investments Limited
Holding Company
|
100%
|
Smithstown, Shannon, Co. Clare,
Ireland
|
|
|
|
Lotusglade Limited
|
100%
|
Smithstown, Shannon, Co. Clare,
Ireland
|
Holding company
|
|
|
|
|
|
Floralglade Company
|
100%
|
Smithstown, Shannon, Co. Clare,
Ireland
|
Holding company
|
|
|
|
|
|
Spartan Drilling Tools
Manufacturing facility
23. Subsidiary undertakings (continued)
|
100%
|
1882 US HWY 6 & 50 Fruita, CO
81521, USA
|
Company
|
Group
Share %*
|
Registered Office
&
Country of
Incorporation
|
|
|
|
Castle Heat Treatment
Limited
|
100%
|
Smithstown, Shannon, Co. Clare,
Ireland
|
Holding company
|
|
|
|
|
|
Mincon Microcare Limited
|
100%
|
Smithstown, Shannon, Co. Clare,
Ireland
|
Holding company
|
|
|
Driconeq AB
|
100%
|
Svetsarevägen 4, 686 33, Sunne,
Sweden
|
Holding company
|
|
|
|
|
|
Driconeq Production AB
|
100%
|
Svetsarevägen 4, 686 33, Sunne,
Sweden
|
Manufacturing facility
|
|
|
|
|
|
Driconeq Fastighet AB
|
100%
|
Svetsarevägen 4, 686 33, Sunne,
Sweden
|
Property holding company
|
|
|
|
|
|
Driconeq Do Brasil
|
100%
|
Rua Dr. Ramiro De Araujo Filho,
348, Jundai, SP, Brasil
|
Dormant company
|
|
|
|
|
|
Mincon South Africa
|
100%
|
Cnr of Harriet and James Bright
Avenue, Driehoek. Germiston 1400,
RSA
|
Manufacturing facility
|
|
|
|
|
|
Driconeq Australia Holdings Pty
Ltd
|
100%
|
Welshpool, WA 6106,
Australia
|
Holding company
|
|
|
|
|
|
Driconeq Australia Pty
Ltd
|
100%
|
Welshpool, WA 6106,
Australia
|
Manufacturing facility
|
|
|
|
|
|
Mincon Drill String AB
|
100%
|
Svetsarevägen 4, 686 33, Sunne,
Sweden
|
Holding company
|
|
|
EURL Roc Drill
Sales company
|
100%
|
3 Rue Charles Rolland, 29650
Guerlesquin, France
|
Attakroc Inc
Sales company
|
100%
|
6330-300, Zéphirin-Paquet, Quebec,
QC G2C 0M2
|
Mincon Quebec
Holding company
|
100%
|
3000-1 Place Ville-Marie,
Montreal, Quebec, H3B 4N8
|
|
|
|
*All shares held are ordinary
shares.
|
|
|
24. Leases
A. Leases as Lessees (IFRS
16)
The Group leases property, plant
and equipment across its global operations.
Mincon Group PLC has elected to
apply the practical expedient allowed under IFRS 16 for short-term
leases by class of underlying asset to which the right of use
relates. A class of underlying asset is a grouping of underlying
assets of a similar nature and use in an entity's operations. The
class of underlying assets this applies to short term leases of
office equipment.
Information about leases for which
the Group is a lessee is presented below.
i)
Right-of-use
assets
|
31 December
2023
|
|
€'000
|
Balance at 1 January
2023
|
6,768
|
Depreciation charge for the
year
|
(2,205)
|
Additions to right of use
assets
|
1,013
|
Disposal of right of use
asset
|
(89)
|
Foreign exchange
difference
|
(183)
|
Balance at 31 December 2023
|
5,304
|
|
31 December
2024
|
|
|
€'000
|
|
Balance at 1 January
2024
|
5,304
|
|
Depreciation charge for the
year
|
(2,070)
|
|
Additions to right of use
assets
|
3,182
|
|
Disposal of right of use
asset
|
(192)
|
|
Foreign exchange
difference
|
223
|
|
Balance at 31 December 2024
|
6,447
|
|
|
|
|
|
ii)
Amounts recognised in income
statement.
|
2024
|
2023
|
|
€'000
|
€'000
|
Interest on lease
liabilities
|
445
|
698
|
Expenses related to short term
leases
|
4
|
5
|
Leases under IFRS 16
|
449
|
703
|
iii)
Amounts recognised in statement of cash
flows
|
2024
|
2023
|
|
€'000
|
€'000
|
Total cash outflow for
leases
|
3,058
|
4,194
|
Total cash outflow of leases
|
3,058
|
4,194
|
24. Leases (continued)
A. Leases as Lessees (IFRS
16) (continued)
iv)
Extension options
Some property leases contain
extension options exercisable by the Group. The Group assesses at
lease commencement date whether it is reasonably certain to
exercise the extension options. The Group is reasonably certain it
will not incur future lease liabilities beyond what is currently
calculated.
The following table sets out a
maturity analysis of lease liabilities, showing the undiscounted
lease payments to be paid after the reporting date.
|
|
31 December
2024
|
|
|
€'000
|
Less than one year
|
|
2,010
|
One to two years
|
|
2,530
|
Two to five years
|
|
1,763
|
More than 5 years
|
|
580
|
Total
|
|
6,883
|
|
|
31 December
2023
|
|
|
€'000
|
Less than one year
|
|
2,068
|
One to two years
|
|
2,042
|
Two to five years
|
|
788
|
More than 5 years
|
|
850
|
Total
|
|
5,748
|
B. Leases as Lessor (IFRS
16)
i)
Financing Lease
The Group subleased a properties
that had been recognised as a right of use asset in Finland and
Australia. The Group recognised income interest in the year in
relation to this totalling €10,000 (2023: €132,000).
The Group manages the risk to
retain the right to the assets as they have a right to inspect the
property, the right to enforce the contractual arrangement with the
lessee and the right to perform maintenance.
The following table sets out a
maturity analysis of lease receivable, showing the undiscounted
lease payments to be received after the reporting date.
|
31 December
2024
|
31 December
2023
|
|
€'000
|
€'000
|
Less than one year
|
-
|
11
|
Balance at 31 December
|
-
|
11
|
Unearned finance income
|
-
|
-
|
Total undiscounted lease receivable
|
-
|
11
|
ii)
Operating leases
The group leases company owned
property out to tenants in the USA under various agreements. The
group recognises these leases as operating leases from a lessor
perspective due to the fact they do not transfer substantially all
of the risks and rewards incidental to the ownership of the
assets.
Rental income recognised by the
Group during 2024 was €133,000 (2023: €120,000).
24. Leases (continued)
B. Leases as Lessor (IFRS 16)
i)
Operating leases (continued)
The following table sets out a
maturity analysis of lease receivable, showing the undiscounted
lease payments to be received after the reporting date.
|
|
31 December
2024
|
|
|
€'000
|
Less than one year
|
|
32
|
One to two years
|
|
68
|
Two to three years
|
|
36
|
Total
|
|
136
|
|
|
31 December
2023
|
|
|
€'000
|
Less than one year
|
|
73
|
One to two years
|
|
30
|
Two to three years
|
|
32
|
Total
|
|
135
|
25. Commitments
The following capital commitments
for the purchase of property, plant and equipment had been
authorised by the Directors as at 31 December 2024:
|
31
December
|
31
December
|
|
2024
|
2023
|
|
€'000
|
€'000
|
Contracted for
|
2,017
|
1,585
|
Not-contracted for
|
-
|
-
|
Total
|
2,017
|
1,585
|
|
|
|
|
26. Litigation
The Group is not involved in legal
proceedings that could have a material adverse effect on its
results or financial position.
27. Related parties
As at 31 December 2024, the share
capital of Mincon Group plc was 56.32% owned by Kingbell Company
which is ultimately controlled by Patrick Purcell and members of
the Purcell family. Patrick Purcell is also a Director of the
Company.
In June 2024, the Group paid a
final dividend for 2023 of €0.0105 to all shareholders. The total
dividend paid to Kingbell Company was €1,256,477.
In December 2024, the Group paid
an interim dividend for 2024 of €0.0105 to all shareholders. The
total dividend paid to Kingbell Company was €1,256,477 (December
2023: €1,256,477).
The Group has a related party relationship with its subsidiary
undertakings (see note 23) for a list of these undertakings),
Directors and officers. All transactions with subsidiaries
eliminate on consolidation and are not disclosed.
27. Related parties (continued)
Transactions with Directors
The Group is owed €Nil from
Directors and shareholders at 31 December 2024 and 2023. The Group
has amounts owing to Directors of €Nil as at 31 December 2023 and
2024.
Key management compensation
The profit before tax from
continuing operations has been arrived at after charging the
following key management compensation:
|
2024
|
2023
|
|
€'000
|
€'000
|
Short term employee benefits
|
1,430
|
1,616
|
Bonus and other
emoluments
|
16
|
24
|
Post-employment contributions
|
128
|
156
|
Social security costs
|
101
|
117
|
Share based payment charged in the
year
|
26
|
(160)
|
Total
|
1,701
|
1,753
|
The key management compensation
amounts disclosed above represent compensation to those people
having the authority and responsibility for planning, directing and
controlling the activities of the Group, which comprises the Board
of Directors and executive management (twelve in total at year
end). Amounts included above are time weighted for the period of
the individuals employment.
28. Events after the reporting date
The Board of Mincon Group plc is
recommending the payment of a final dividend for the year ended 31
December 2024 in the amount of €0.0105 (1.05 cent) per ordinary
share, which will be subject to approval at the Annual General
Meeting of the Company in May 2025. Subject to Shareholder approval
at the Company's annual general meeting, the final dividend will be
paid on 13 June 2025 to Shareholders on the register at the close
of business on 23 May 2025.
At 31 December 2024, the property,
plant and equipment owned by Mincon Carbide was in the process of
being sold to a third party. The sale was completed on 17 January
2025 for a total consideration of £1.8 million (€2.2
million).
29. Approval of financial statements
The Board of Directors approved the
consolidated financial statements on 10 March 2025.