Non-Executive Chair's statement
Strategic Opportunity
Three years ago, Motorpoint
announced a departure from its historic approach by more
aggressively embracing the role of technology and digital services
in its business and setting forth more ambitious medium term goals
to at least double its revenue to over £2bn by, among other things,
growing its E-commerce revenue to over £1bn and opening 12 new
stores. Reaching these goals would require transformative levels of
investment in new capabilities including technology and automation,
data and analytics, digital commerce, marketing, new sales and
service stores and its omnichannel customer proposition.
Since this announcement, in spite of
the significant economic challenges affecting the used car market
and Motorpoint in particular, the Company has progressed towards
its goals by hiring key strategic leaders, developing new
technologies and digital capabilities, and refining its strategy to
include specific further capabilities that will position Motorpoint
uniquely in the market. Although this progress has been constrained
by economic and market factors, nevertheless our belief in the
strategic direction and the size of our opportunity has
grown.
The use of digital services is
becoming universal amongst car buyers and sellers. This natural
progression presents an opportunity for retailers to
disintermediate portions of the used car market by selling direct
to consumers through a lower cost, higher service model, by buying
direct from consumers or via new online marketplaces, and by
building brand leadership and market share through aggressive
marketing. However we have learned, based on our customer data,
that some degree of physical connection continues to be preferred
by most customers to provide reassurance and trust in the
transaction. Motorpoint, as a leading omnichannel retailer, is
uniquely positioned to serve this need and is developing integrated
consumer journeys across its digital, store, customer service and
delivery channels that will meet changing consumer needs. This is
Motorpoint's central strategic opportunity.
Underpinning Motorpoint's new
capabilities will be contemporary technology and data practices.
These will not only create unique cross channel customer journeys,
but will improve efficiency in our key processes such as selling,
vehicle preparation, logistics, pricing and inventory
turnover.
Leading With Agility and Responsibility
With its focus on the long term
strategic growth opportunity, Motorpoint has faced very difficult
markets which have challenged its near term performance and
investment capacity. In Motorpoint's 2022 financial year (FY22),
the Covid pandemic was over; however supply chain shortages
continued to limit the manufacturing of new vehicles, used car
prices were inflated due to constrained supply, and consumer
confidence was declining as consumers began feeling the effects of
general inflation and rising interest rates. Motorpoint performed
strongly in that year with record revenue, growth in market share
and strong operating profit. While many in the market were
cautious, Motorpoint recommitted to its ambition to lead the UK's
used car market by investing in new capabilities, digitally driven
customer experiences and new stores.
During FY23, economic and market
conditions deteriorated further, especially in the second half.
Rising inflation and interest rates, coupled with constrained used
car supply, inflated prices and a significant OEM induced cut in
used electric vehicle values, made trading particularly
challenging. Further, high interest rates affected several
components of our profit model. High consumer finance rates reduced
consumer demand and pinched unit profitability, Motorpoint's
finance commissions reduced as it tried to hold consumer rates
below market, and its finance expense on inventory borrowings
increased. In the face of these challenges Motorpoint continued to
make prudent strategic investments in order to progress towards its
strategic ambition while attempting to remain profitable and
preserve cash. Motorpoint's operating profit fell, its net profit
before tax was roughly breakeven while it managed to again grow
revenues and market share.
As the Company approached FY24, it
believed that economic and market conditions would not improve and
indeed could worsen further with no end in sight. In fact, economic
conditions during FY24 were the most difficult in Motorpoint's 25
year history. High interest rates, price deflation,
constrained used vehicle supply and depressed consumer demand
intersected causing several industry consolidations, a high
visibility administration and massive industry losses. For
Motorpoint, it reacted early in the year to implement a rightsizing
and margin improvement programme with an aim to limit losses and
preserve cash in a smaller, persistently difficult market. It
prioritised increasing unit margins, reducing operating expenses
and generating cash over revenue and market share growth. It also
tempered strategic investments and focused on efficiency, trading
effectiveness and near term returns. Although the year was loss
making, by the final quarter Motorpoint was back to growth and
profitability.
I am pleased that Motorpoint has
been agile and resilient through a tumultuous period and made sound
decisions based on changing market conditions. It has also remained
committed to its strategic plan in a manner that has balanced its
investments responsibly and brought substantial new technology,
digital, marketing and operational expertise into the business.
Motorpoint is now well positioned to reverse the FY24 loss and
extend its profitability and cash generation as the market improves
further, to set new expectations for medium term growth, and to
recommit to investments in new capabilities, digitally driven
customer experiences and new stores in order to take a long term
leadership role in the UK used car market.
I would like to thank the Motorpoint
team for their extraordinary contributions over an extended period.
I look forward to a positive future for the Company and all of our
colleagues.
John Walden
Non-Executive Chair, Motorpoint
PLC
13 June 2024
Chief Executive's statement
Overview
Difficult macroeconomic conditions
hampered our growth and profitability for much of FY24. There was
also a shortage of good quality, nearly new vehicles. We took
decisive action to rightsize the business to reflect the reduced
market size and ensure cash generative trading at lower levels of
Group sales. The external headwinds did ease in Q4, and this, along
with the results of our actions taken during the year, meant we
returned to profitable growth in the last three months of FY24,
with retail sales up 8.9%.
High interest rates and inflation
were a key feature throughout FY24 and fuelled consumer
uncertainty, and the market for our 0-4 year old sector reached a
low point of 1.5m sales per annum, from a pre Covid high of 2.5m.
This, along with deflation and stock mix, influenced our revenue
fall to £1,086.6m (FY23: £1,440.2m) and retail units sold were
52.6k. (FY23: 57.3k), despite a strong final quarter with
significant year on year growth. In addition, the high market
prices and APR rates have reduced affordability for consumers. To
counteract this, we expanded our retail criteria so that the
majority of cars were less than five years old and 50,000 miles, to
help customers find the right vehicle in accordance with more
constrained household budgets.
These reduced retail volumes,
pressure on finance attachment rates due to high APRs, and high
stock interest expense, resulted in a drag on profitability, and
the business returned a loss before taxation and exceptional items
of £(8.2)m (FY23: loss before taxation £(0.3)m). As a consequence
of actions taken, and an easing in headwinds, the business returned
to profitability in the final quarter, which coincided with year on
year retail volume growth.
For much of the year we prioritised
protecting profit and cash. Helped by use of improved data
analysis, we were able to improve unit margins, introduce an
affordable administration fee and increase A4C fees (but still
below the market norm). We also rightsized our headcount to reflect
the lower volumes and reduced marketing costs. FTEs at 31 March
2024 were 710, significantly down from the high of almost 950 in
the early part of FY23.
Despite the profitability pressures,
the Group again demonstrated its resilience to end the year with
net cash excluding lease liabilities of £9.2m (FY23: £5.6m). There
is significant cash headroom, with the £20.0m (FY23: £35.0m) bank
facility undrawn at year end. Of this, £6.0m (FY23: £6.0m) is
available as an uncommitted overdraft and £14.0m (FY23: £29.0m) as
a revolving credit facility.
Focusing on Brilliant Basics in FY24
Our focus on driving operational
excellence through a programme we call Brilliant Basics has
resulted in a lean cost base, faster stock turn and lower prices,
with the cumulative effect of consistent profitability in the final
three months of the year.
The market challenges in FY24
required decisive action to rightsize the business and refocus our
priorities on the established basics which have served us so well
historically. This included a thorough review of our headcount
requirements, and a plan to ensure that all roles in the business
have accountability measures, with strengthened reporting. We
reviewed our margin performance, supported by the use of data, and
stock mix, to ensure we have the right vehicles for customers at
the right price. Our agile sourcing model allowed us to expand
vehicle age and mileage criteria to offer lower price points to
meet broader customer demand. We saw the benefits of this with
strong performance in the final quarter. We also looked at our
ancillary offering in Q4 and extended our warranty product to cover
customers for an additional year (now up to three years). This
quickly resulted in an uplift in revenue and profitability, and
helped offset the impact of the removal of the asset protection
product.
Strategy Update
We have made good progress against
our strategic targets announced in June 2021. Despite the market
challenges during FY24, we remain committed to our long term growth
aspirations, whilst focusing in the short term on margin
improvement, cost base management and cash generation, and
strategic objectives that offer the best short term returns. The
strong cash position allowed us to continue making targeted
strategic investment, with further improvements in technology
involving both our retail and wholesale businesses, and we opened
our 20th store, in Ipswich, in May 2023.
During FY24, we continued to enhance
our digital capability, and upscale our E-commerce offering. We
made improvements to the website Product Detail Pages (PDPs) and
introduced new imagery. These changes improved page views and the
time customers spend on our site. Saved search and recommendation
functionality was introduced. Email alerts are now in place to
inform customers when the vehicle they are looking for has arrived.
We experienced record levels of organic traffic, and website speed
improved by 43.5% in March 2024 compared to April 2023.
The Group's use of data is
fundamental to how we operate. As well as helping to inform vehicle
pricing decisions, it supports the identification of what vehicles
customers desire. As an example, it allowed us to identify that new
customers are more likely to buy cheaper vehicles than returning
ones, and this helped inform our decision to expand our retail
criteria. In addition, we now send up to four emails a week to
consumers, compared to just one historically.
We have strengthened our Data
Insight team by recruiting external talent, and by harnessing the
benefits of automation we have been able to continue to deliver
operational improvements, from preparation speed and reduced
stockholding to customer self-serve technology. Automation allowed
us in the year to improve efficiency and reduce
headcount.
Our priorities for the year ahead
include strengthening our vehicle supply, pushing ahead with
consumer digital engagement, using data to inform decision making
and the introduction of new profit channels. We also expect to
recommence our new store opening programme during FY25, now that we
see the market returning.
The
Motorpoint Virtuous Circle remains at the core of everything we
do
Our operating model of how our
employees and stakeholders interact, the Motorpoint Virtuous
Circle, combined with our Values of Proud, Happy, Honest and
Supportive continue to provide a robust framework for explaining
how we get things done and what factors to consider when decisions
are required.
The Virtuous Circle begins with our
employees. In the final quarter we conducted our Driving Seat
survey for all team members, which highlighted strong satisfaction
levels across the business. Our values scored highly, with 95% of
the team who responded saying that they were Proud to work for
Motorpoint.
We sponsor multiple initiatives to
enhance our team's experience with Motorpoint. Our 'One Big Dream'
initiative has been a huge success, with our people using two paid
hours per month for their own fulfilment. Team retention levels
improved over the year, with staff turnover falling from 32% in
April 2023 to 27% in March 2024.
Our One Team ethos was perfectly
highlighted when the Derby store was badly flooded in October 2023.
This resulted in significant disruption for employees and
customers, and required a major clean up operation. I am very proud
of our employees from across the business (whether it be from the
office, other locations or the Derby store itself) who all pulled
together to ensure that the site was up and running again within
four weeks, and that customers were not left
disappointed.
We believe that the engagement of
our team is directly correlated to our customers' satisfaction. As
we innovate our omnichannel customer experiences, our highly
engaged team continued to deliver what we believe is a market
leading proposition of Choice, Value, Service and Quality to our
loyal customers with an unerring focus on customer satisfaction.
Our NPS for sold vehicles remains at industry leading levels at 82
(FY23: 84).
During the year, we introduced new
products and services to enhance the customer experience. For
example, we expanded our retail criteria to ensure we held more
affordable vehicles, and improved our warranty product by extending
the length of cover available. In the last few months of FY24, in
response to increased customer demand, we recruited additional team
members in our busier stores to ensure that the high standards of
customer experience were maintained.
The final piece of our Virtuous
Circle is delivering for our shareholders. The external headwinds
did impact profitability in the year, although we improved cash
generation and had the confidence to commence the share buyback, to
benefit shareholders. The improvement in performance in the final
quarter provides further confidence that we can look forward to
delivering strong profitable growth and cash generation.
Environmental, Social and Governance (ESG)
The Group's ESG Committee continues
to be instrumental in setting out appropriate ESG targets. The
Group wants to be viewed as the most environmentally friendly used
car retailer and has made significant progress on its ESG strategic
goals.
We are delighted that our progress
was recognised by the Financial Times naming Motorpoint as one of
Europe's Climate Leaders, who are most successful in reducing their
core greenhouse gas emissions. We have championed our commitment to
energy management through internal communication
channels.
Due to the nature of our business,
most emissions relate to Scope 3 and the use of sold products.
However, Scope 3 emissions did decrease year on year by 21%,
although much of this was driven by a reduction in products sold
and mix of vehicles. Going forward, we remain dependent on original
engine manufacturers (OEMs) in respect of increasing the supply of
zero emission vehicles. We expect our Scope 3 emissions to decrease
as the UK transitions to a lower carbon economy, particularly in
relation to cessation of sales of new internal combustion engine
(ICE) vehicles from 2035.
In terms of what we can directly
control, we have made further, good progress in energy savings.
Like for like Scope 1 and 2 emissions and business travel, are down
14% versus the previous year based on tonnes of carbon relative to
the square foot area of the business. Waste collection costs are
also down 15%, and less than 0.2% waste went to
landfill.
We also have made further
improvements to support inclusion and remove unconscious bias, and
our gender pay gap has again reduced.
Outlook
Successful execution of our
Brilliant Basics restructuring programme during FY24 will stand the
business in good stead moving forwards as the market continues to
improve. Our lean cost base, strong data driven focus on margins,
faster stock turn and enhanced digital capabilities should enable
us to continue the Q4 FY24 trend of profitable growth. We envisage
that 2023's difficult macro conditions will continue to ease with
customer sentiment improving. Supply should increase following new
car registration growth, and used car market expansion. Therefore,
we believe that there is substantial potential to realise strong
profitable growth and cash generation as we leverage our lower cost
base with increased volumes. As performance improves, we look
forward to resetting and re-energising our strategic goals,
including further new store opportunities, against our long
term ambition to lead the UK used car market.
Mark Carpenter
Chief Executive Officer
13 June 2024
FINANCIAL REVIEW
Strong final quarter with growth in retail units sold,
improved margins and a subsequent return to profitability,
following a challenging year influenced by economic
headwinds
Group financial performance headlines
Revenue reduced to £1,086.6m (FY23:
£1,440.2m) reflecting the shrinkage of the nearly new used car
market and economic headwinds. Retail units sold fell from 57.3k in
FY23 to 52.6k, although we returned to year on year growth in the
final quarter. Affordability became an increasingly big
issue for consumers, and we prioritised stock mix with less
expensive vehicles. Consequently, during FY24, we relaxed our age
and mileage criteria to ensure that we have the vehicles that
customers desire and can afford.
Gross profit was £73.1m (FY23:
£85.7m). Gross margin improved in the year to 6.7% (FY23: 6.0%),
largely due to our focus on improving metal margin, which includes
using data to determine optimum pricing at a given time, as well as
the introduction of an administration fee, which is now in line
with much of the market. Finance commission per vehicle sold
reduced, following the fall in average selling prices and the
impact of increased APRs.
Despite inflation, operating
expenses before exceptional items reduced by 8.0% to £72.9m (FY23:
£79.2m), largely reflecting a decrease in headcount and lower
marketing spend.
Net exceptional expense before
taxation of £2.2m (FY23: £Nil) largely relates to costs following a
one-off restructuring review in the year with the balance relating
to the costs of the previously announced Derby flood and related
insurance receipts.
As a consequence of the challenging
external conditions, loss before taxation and exceptional items was
£(8.2)m (FY23: £(0.3)m).
Despite the lower profitability, and
as management took decisive action, net cash excluding lease
liabilities, improved to £9.2m at the year end (FY23:
£5.6m).
Trading performance
The Group has two key revenue
streams, being (i) vehicles sold to retail customers via the
Group's stores, call centre and digital channels, and (ii) vehicles
sold to wholesale customers via the Group's Auction4Cars.com
website.
|
Retail customers
|
Wholesale
customers
|
Total
|
|
FY24
|
FY23
|
FY24
|
FY23
|
FY24
|
FY23
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
|
|
|
|
|
|
|
Revenue
|
931.1
|
1,175.7
|
155.5
|
264.5
|
1,086.6
|
1,440.2
|
|
|
|
|
|
|
|
Gross profit
|
64.3
|
74.5
|
8.8
|
11.2
|
73.1
|
85.7
|
|
|
|
|
|
|
|
Retail
Revenue from retail customers was
down 20.8% to £931.1m (FY23: £1,175.7m), with 52.6k (FY23: 57.3k)
vehicles sold (a fall of 8.2%). The remainder of the revenue fall
reflected the lower price of vehicles sold. The year on year trend
improved from a fall of 18.4% in the first half, with growth of
8.9% in the final quarter. Consumer demand has picked up, and we
have benefited from the numerous enhancements made to our digital
presence during the past year which, among other things, is
generating significantly more website traffic. In the year,
32.4% of vehicles were sold online and we continue to see around
two thirds of customers wanting the store experience for their
vehicle purchase.
Gross margin of 6.9% was a good
improvement given the headwinds experienced (FY23: 6.3%), with the
strengthening of metal margin offsetting the impact of higher APRs
on finance commission. We have seen a fall in attachment rates due
to the higher cost of finance. Finance per vehicle sold therefore
decreased in the period, following this increase in interest rates
and lower price points, reflecting mix and deflation. Penetration
was 46% (FY23: 56%). Our APR finance rates continue to be
competitive despite increasing from 11.9% to 12.9% at the start of
October 2023.
We continue to develop our customer
proposition and have added a new three year warranty product which
has been well received by our customers and has offset the removal
of our asset protection product following FCA instruction to all
insurers to voluntarily withdraw the product.
Our 20th and newest store opened in
May 2023 in Ipswich. During the year, we also disposed of the lease
for our unopened property in Milton Keynes. This was a site we
acquired in FY23 but had not incurred any material development
costs.
Wholesale
Wholesale revenue via
Auction4Cars.com, which sells vehicles that have been part
exchanged by retail customers, or directly purchased from
consumers, decreased by 41.2%. With the relaxation of the retail
age and mileage criteria, the number of vehicles sold through the
wholesale channel significantly decreased. Around 25.4k vehicles
were sold via this purely online platform. Gross margin of 5.7%
(FY23: 4.2%) improved from the previous year with greater focus on
reducing the number of loss making vehicles sold through this
platform.
Operating expenses before exceptional items
Our cost management remains tightly
controlled, with notable savings achieved in people costs following
FY24's rightsizing programme and efficiencies resulting from
technology investment.
Operating expenses before
exceptional items decreased from £79.2m in FY23 to £72.9m. Despite
the new store opened, overall full time equivalent employees
reduced to 710 at year end from 789 at 1 April 2023, as we
continually focused on efficiency in stores, preparation and Head
Office, and rightsized our headcount to reflect market conditions.
Energy rates (for the property portfolio at the time) were fixed
for two years in September 2021, and we experienced an increase in
unit rates from October 2023, therefore. However, following a
focused approach to managing usage, along with a milder winter,
meant we experienced a reduction of 15% in electric and gas
consumption compared to FY23 on a per square footage basis.
Property costs increased by 9% and included the opening of the
Ipswich store in May 2023, and the full year effect of FY23
openings. Marketing costs decreased from £14.0m to £10.0m as we
target a more focused approach, as well as responding to the lower
consumer demand for much of FY24.
Other income before exceptional items
Other income before exceptionals of
£1.3m (FY23: £0.3m) includes business interruption insurance
proceeds in respect of the closure of the Derby site following the
flooding in October 2023, and subsequent reduced trading with the
opening of the temporary showroom.
Exceptional items
Net exceptional items before
taxation of £2.2m (FY23: £Nil) constituted restructuring costs for
various redundancies associated with the headcount rightsizing
programme (£1.1m), the write down of delivery vehicles which are
being disposed of following the driver redundancies associated with
the above (£0.2m), and cost relating to the disposal of the Milton
Keynes lease (£0.5m), along with the net of assets written off
following the Derby flood not covered by insurance.
On a gross basis, exceptional
operating expenses were £7.7m (FY23: £Nil) which included the flood
damaged assets written off and the restructuring costs. Exceptional
other income of £5.6m (FY23: £Nil) included insurance receipts
against those written off assets.
Interest
The Group's finance expense was
£9.8m (FY23: £7.1m); the increase reflects the sharp rise in cost
of borrowing, despite lower inventory.
Total interest charges on the
stocking facilities in the period were £7.1m (FY23: £4.7m).
Interest on lease liabilities was £2.0m (FY23: £2.0m) and on
banking facilities £0.7m (FY23: £0.4m).
Taxation
The tax credit (FY23: charge) in the
period is for the amount assessable for UK corporation tax in the
year net of prior year adjustments and deferred tax credits. The
tax credit was £2.0m (FY23: £0.3m charge), reflecting the loss in
the year.
Earnings per share
Basic and diluted earnings per share
were both (9.3)p (FY23: both (0.7)p).
Dividends
No dividend was paid in the period
(FY23: £Nil) and the Board has not recommended a dividend (FY23:
£Nil).
Capital expenditure
Cash capital expenditure reduced to
£2.6m (FY23: £9.4m) as the business preserved cash and cut
discretionary spend, with additions primarily relating to the new
store in Ipswich and ongoing IT projects.
Balance sheet
Net assets decreased in the year in
line with the loss made. Working capital was proactively managed,
in particular ensuring that stock purchasing was maximised through
the funding facilities.
Non-current assets were £64.4m (31
March 2023: £75.2m) made up of £8.8m of property, plant and
equipment, £50.5m of right-of-use assets, intangible assets of
£3.7m and a deferred tax asset of £1.4m (31 March 2023: £13.1m,
£58.4m, £3.7m and a deferred tax liability of £0.2m respectively).
The Group currently owns one remaining freehold plot of land in
Glasgow, which is being held for sale. All other properties are on
leases of various lengths.
The Group closed the period with
£102.4m of inventory, down from £148.6m at 31 March 2023. Days In
Stock for the year reduced to 45 days (FY23: 51 days).
As at 31 March 2024, the Group had
£150.0m (31 March 2023: £195.0m) of stocking finance facilities
available of which £74.5m (31 March 2023: £102.5m) was drawn. The
Group had available stocking facilities with Black Horse Limited of
£75.0m, and £75.0m with Lombard North Central Plc. During the year
it was agreed with Black Horse Limited to reduce the amount
available to £75.0m from £120.0m, to reflect the unused portion. In
addition, the net asset covenant test was reduced from £30.0m to
£20.0m.
The Group also has a £20.0m (FY23:
£35.0m) facility with Santander UK Plc, split between £6.0m
available as an uncommitted overdraft and £14.0m available as a
revolving credit facility. During the period it was agreed with
Santander UK Plc to reduce the revolving credit facility from
£29.0m to £14.0m. The overdraft remained the same. As part of this
negotiation the fixed charge covenant test was reduced from
1.25:1.00 cover to 1.00:1.00 until September 2025.
Trade and other receivables have
slightly increased to £19.2m (31 March 2023: £18.4m), due to the
timing of receipts over the year end, which coincided this year
with the Easter Bank Holidays.
Trade and other payables, inclusive
of the stock financing facilities, have reduced during the year to
£107.1m (31 March 2023: £143.8m) mainly as a result of the
reduction in stocking facility utilisation, reflecting lower
inventory levels.
The decrease in total lease
liabilities to £57.0m (31 March 2023: £63.6m) reflects the
repayments made during the period, and the removal of the Milton
Keynes lease.
Cash flow
Despite a loss for the year of
£(8.4)m (FY23: £(0.6)m) cash increased by £3.6m. This included the
benefit of working capital improvement and low capital expenditure.
Cash flow generated from operations was £19.3m inflow (FY23: £41.3m
inflow) and therefore remains strong.
Capital structure and treasury
The Group's objective when managing
working capital is to ensure adequate working capital for all
operating activities and liquidity, including comfortable headroom
to take advantage of opportunities, or to weather short term
downturns. The Group also aims to operate an efficient capital
structure to achieve its business plan.
In January 2024, we announced our
intention to commence a share buyback programme of approximately 5%
of the ordinary shares of the Company, and to cancel these shares.
Even after taking into consideration the capital required to fund
organic growth, the Company's cash generation and the strength of
its balance sheet has led the Board to conclude that the programme
is an attractive use of the Company's resources and beneficial for
all shareholders.
As at 31 March 2024, 190,001 shares
had been purchased and cancelled, representing 3.8% of the planned
buyback programme. Accordingly, the Company's issued share capital
at year end comprised 89,999,884 ordinary shares (31 March 2023:
90,189,885).
The Group's long term funding
arrangements consist primarily of the stocking finance facilities
with Black Horse Limited and Lombard North Central Plc (to a
maximum of £150.0m) and an unsecured loan facility provided by
Santander UK Plc, split between £6.0m available as an uncommitted
overdraft and £14.0m available as a revolving credit facility.
During FY24, the Group successfully extended its terms on the
unsecured loan facility with Santander UK Plc. This agreement now
runs until June 2026 with the option to extend for two further one
year extensions if agreed by both parties.
Chris Morgan
Chief Financial Officer
13 June 2024
CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME
FOR
THE YEAR ENDED 31 MARCH 2024
|
Note
|
2024
£m
|
2024
£m
|
2024
£m
|
2023
£m
|
|
|
Before exceptional
items
|
Exceptional items
(1)
|
Total
|
|
Revenue
|
3
|
1,086.6
|
-
|
1,086.6
|
1,440.2
|
Cost of sales
|
4
|
(1,013.5)
|
-
|
(1,013.5)
|
(1,354.5)
|
Gross profit
|
|
73.1
|
-
|
73.1
|
85.7
|
Operating expenses
|
4
|
(72.9)
|
(7.7)
|
(80.6)
|
(79.2)
|
Other income
|
|
1.3
|
5.6
|
6.9
|
0.3
|
Operating profit / (loss)
|
|
1.5
|
(2.1)
|
(0.6)
|
6.8
|
Finance expense
|
|
(9.7)
|
(0.1)
|
(9.8)
|
(7.1)
|
Loss before income tax
|
|
(8.2)
|
(2.2)
|
(10.4)
|
(0.3)
|
Income tax income /
(expense)
|
|
1.8
|
0.2
|
2.0
|
(0.3)
|
Loss for the year
|
|
(6.4)
|
(2.0)
|
(8.4)
|
(0.6)
|
Other comprehensive expenses:
Items that will not be reclassified to profit or loss
Tax relating to items which
will not be reclassified to profit or loss
|
|
(0.1)
|
-
|
(0.1)
|
(0.1)
|
Other comprehensive expense
|
|
(0.1)
|
-
|
(0.1)
|
(0.1)
|
Total comprehensive expense for the year attributable to
equity holders of the parent
|
|
(6.5)
|
(2.0)
|
(8.5)
|
(0.7)
|
|
|
|
|
|
|
Earnings per share attributable to equity holders of the
parent
|
|
|
|
|
|
Basic
|
6
|
|
|
(9.3p)
|
(0.7p)
|
Diluted
|
6
|
|
|
(9.3p)
|
(0.7p)
|
(1) Detail on exceptional
items is provided in note 5
The Group's activities all derive
from continuing operations.
CONSOLIDATED BALANCE SHEET
AS
AT 31 MARCH 2024
|
Note
|
2024
£m
|
2023
£m
|
ASSETS
|
|
|
|
Non-current assets
|
|
|
|
Property, plant and
equipment
|
|
8.8
|
13.1
|
Right-of-use assets
|
|
50.5
|
58.4
|
Intangible assets
|
|
3.7
|
3.7
|
Deferred tax assets
|
|
1.4
|
-
|
Total non-current assets
|
|
64.4
|
75.2
|
Current assets
|
|
|
|
Inventories
|
|
102.4
|
148.6
|
Trade and other
receivables
|
|
19.2
|
18.4
|
Current tax receivable
|
|
-
|
1.3
|
Cash and cash equivalents
|
|
9.2
|
5.6
|
Assets held for sale
|
|
2.6
|
-
|
Total current assets
|
|
133.4
|
173.9
|
TOTAL ASSETS
|
|
197.8
|
249.1
|
LIABILITIES
|
|
|
|
Current liabilities
|
|
|
|
Trade and other payables, excluding
contract liabilities
|
|
(107.1)
|
(143.8)
|
Borrowings
|
7
|
-
|
-
|
Lease liabilities
|
|
(4.0)
|
(3.4)
|
Total current liabilities
|
|
(111.1)
|
(147.2)
|
|
|
|
|
Net
current assets
|
|
22.3
|
26.7
|
Non-current liabilities
|
|
|
|
Lease liabilities
|
|
(53.0)
|
(60.2)
|
Provisions
|
|
(2.6)
|
(2.6)
|
Deferred tax liabilities
|
|
-
|
(0.2)
|
Total non-current liabilities
|
|
(55.6)
|
(63.0)
|
TOTAL LIABILITIES
|
|
(166.7)
|
(210.2)
|
NET
ASSETS
|
|
31.1
|
38.9
|
|
|
|
|
EQUITY
|
|
|
|
Called up share capital
|
8
|
0.9
|
0.9
|
Capital redemption
reserve
|
|
0.1
|
0.1
|
Capital reorganisation
reserve
|
|
(0.8)
|
(0.8)
|
EBT reserve
|
|
(5.1)
|
(5.3)
|
Retained earnings
|
|
36.0
|
44.0
|
TOTAL EQUITY
|
|
31.1
|
38.9
|
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR
THE YEAR ENDED 31 MARCH 2024
|
Called up
share capital
£m
|
Capital
redemption reserve
£m
|
Capital
reorganisation reserve
£m
|
EBT
reserve
£m
|
Retained
earnings
£m
|
Total
equity
£m
|
Balance at 1 April 2022
|
0.9
|
0.1
|
(0.8)
|
(4.7)
|
43.9
|
39.4
|
Loss for the year
|
-
|
-
|
-
|
-
|
(0.6)
|
(0.6)
|
Other comprehensive expense for the
year
|
-
|
-
|
-
|
-
|
(0.1)
|
(0.1)
|
Total comprehensive expense for the
year
|
-
|
-
|
-
|
-
|
(0.7)
|
(0.7)
|
Transactions with owners in their capacity as
owners:
|
|
|
|
|
|
|
Share‑based payments
|
-
|
-
|
-
|
-
|
0.9
|
0.9
|
EBT share purchases and
commitments
|
-
|
-
|
-
|
(0.7)
|
-
|
(0.7)
|
Share-based compensation options
satisfied through the EBT
|
-
|
-
|
-
|
0.1
|
(0.1)
|
-
|
|
-
|
-
|
-
|
(0.6)
|
0.8
|
0.2
|
Balance at 31 March 2023
|
0.9
|
0.1
|
(0.8)
|
(5.3)
|
44.0
|
38.9
|
Loss for the year
|
-
|
-
|
-
|
-
|
(8.4)
|
(8.4)
|
Other comprehensive expense for the
year
|
-
|
-
|
-
|
-
|
(0.1)
|
(0.1)
|
Total comprehensive expense for the
year
|
-
|
-
|
-
|
-
|
(8.5)
|
(8.5)
|
Transactions with owners in their capacity as
owners:
|
|
|
|
|
|
|
Share‑based payments
|
-
|
-
|
-
|
-
|
1.0
|
1.0
|
Buyback and cancellation of
shares
|
-
|
-
|
-
|
-
|
(0.3)
|
(0.3)
|
EBT share purchases and
commitments
|
-
|
-
|
-
|
-
|
-
|
-
|
Share-based compensation options
satisfied through the EBT
|
-
|
-
|
-
|
0.2
|
(0.2)
|
-
|
|
-
|
-
|
-
|
0.2
|
0.5
|
0.7
|
Balance at 31 March 2024
|
0.9
|
0.1
|
(0.8)
|
(5.1)
|
36.0
|
31.1
|
CONSOLIDATED CASH FLOW STATEMENT
FOR
THE YEAR ENDED 31 MARCH 2024
|
|
2024
£m
|
2023
£m
|
Loss for the year attributable to equity
shareholders
|
|
(8.4)
|
(0.6)
|
Adjustments for:
|
|
|
|
Taxation (credit) /
charge
|
|
(2.0)
|
0.3
|
Finance expense
|
|
9.8
|
7.1
|
Operating (loss) / profit
|
|
(0.6)
|
6.8
|
Share-based payments
|
|
1.0
|
0.1
|
Impairment of assets held for
sale
|
|
0.2
|
-
|
Loss made on assignment of
lease
|
|
0.2
|
-
|
Depreciation and amortisation
charges
|
|
9.9
|
9.4
|
Cash flow from operations before movement in working
capital
|
|
10.7
|
16.3
|
Decrease in inventory
|
|
46.2
|
79.8
|
Increase in trade and other
receivables
|
|
(0.8)
|
(4.8)
|
Decrease in trade and other
payables
|
|
(36.8)
|
(50.0)
|
Cash generated from operations
|
|
19.3
|
41.3
|
Interest paid on borrowings and
financing facilities
|
|
(7.8)
|
(5.1)
|
Interest paid on lease
liabilities
|
|
(2.0)
|
(2.0)
|
Income tax received /
(paid)
|
|
1.6
|
(1.1)
|
Net
cash generated from operating activities
|
|
11.1
|
33.1
|
Cash flows from investing activities
|
|
|
|
Purchases of property, plant and
equipment and intangible assets
|
|
(2.6)
|
(9.4)
|
Proceeds from disposal of property,
plant and equipment and right-of-use assets
|
|
-
|
9.7
|
Net
cash (used in) / generated from investing
activities
|
|
(2.6)
|
0.3
|
Cash flows from financing activities
|
|
|
|
Payments to acquire own
shares
|
|
(0.3)
|
-
|
Payments to satisfy employee share
plan obligations
|
|
-
|
(0.7)
|
Repayment of principal element of
leases
|
|
(4.6)
|
(5.9)
|
Repayment of borrowings
|
|
(24.0)
|
(57.0)
|
Proceeds from borrowings
|
|
24.0
|
28.0
|
Net
cash used in financing activities
|
|
(4.9)
|
(35.6)
|
Net
increase / (decrease) in cash and cash
equivalents
|
|
3.6
|
(2.2)
|
Cash and cash equivalents at the
beginning of the year
|
|
5.6
|
7.8
|
Cash and cash equivalents at end of year
|
|
9.2
|
5.6
|
Net cash and cash equivalents
comprises: Cash at bank
|
|
9.2
|
5.6
|
1.
General information
Motorpoint Group Plc (the 'Company')
is incorporated and domiciled in the United Kingdom under the
Companies Act 2006.
The Company is a public company
limited by shares and is listed on the London Stock Exchange; the
address of the registered office is Champion House, Stephensons
Way, Derby, England, United Kingdom, DE21 6LY. The consolidated
financial statements of the Group as at and for the year ended 31
March 2024 comprise the Company, all of its subsidiaries and the
Motorpoint Group Plc Employee Benefit Trust (the 'EBT'), together
referred to as the 'Group'. The financial statements are presented
in pounds sterling because that is the currency of the primary
economic environment in which the Group operates.
Going concern
In accordance with the UK Corporate
Governance Code 2018, the Board has assessed the prospects of the
Group over a period in excess of 12 months from the date of signing
the Group financial statements as required by the 'Going Concern'
provision, by selecting the period to the end of December
2025.
The Group has managed its net debt
comfortably, with headroom at the year end of £14.0m on the
Revolving Credit Facility, which was undrawn at the year end. Total
headroom, including the stocking facilities, undrawn facilities and
available cash, was in excess of £100.0m at the year end. During
the year the Company renegotiated the terms of both its Revolving
Credit Facility, and stocking facilities, reducing available
headroom from £29.0m and £195.0m to £14.0m and £150.0m
respectively. The renegotiation secured improved terms for the
Group's financial covenants, following the challenging economic
circumstances experienced in FY24, and reflected the Group's
current lower financing requirements. The Board considers
that the available headroom, coupled with the cash generative
nature of the business and the available cash levers provide a
strong degree of financial resilience and flexibility.
Scenarios:
In making their assessment the
Directors considered the Group's current balance sheet and
operational cash flows, the availability of facilities, and stress
testing of the key trading assumptions within the Group's plan. A
range of scenarios have been assessed by the Directors, including
various possible downside scenarios against the base case. The
Directors opted to model a specific scenario designed to create the
conditions required to breach covenants within the going concern
period as well as a plausible downturn on the base case.
Scenario
|
Outcome
|
Base Case
Based upon the Group's most recent
approved forecasts.
The base model assumes a recovery of
profitability and unit volumes in FY25, based on current run rates
of year on year unit volume growth, and a prudent estimate based on
growth in the used car market. Thereafter, modest growth is applied
as the business resumes its strategic goal of taking more market
share.
|
The Group is not in breach of any
financial covenants and is not in a drawdown position on the
Revolving Credit Facility at the end of the going concern period.
The Group is able to meet all forecast obligations as they fall
due.
|
Plausible Downturn
Top down stress testing was applied
to the base case model, taking into account a plausible downturn in
business performance, relative to possible economic pressure and
stagnation in the growth of the used car market.
This included volume and margin
pressure, reducing revenue by 15% and an overall gross profit
reduction compared to the base case of 21%. Fixed costs were
inflated in this scenario by three percent in each year.
|
The Group is not in breach of any
financial covenants and is not in a drawdown position on the
Revolving Credit Facility at the end of the going concern period.
The Group is able to meet all forecast obligations as they fall
due.
|
Reverse Stress Test
A scenario created to model the
circumstances required to breach the Group's covenants within the
going concern period.
The Board considered the potential
impacts in preparing the stress test. The below scenario was
analysed:
Reducing revenue (32% decrease from
the base case) and decreasing gross profit overall by 38% through
additional margin pressure.
|
This scenario is designed to result
in a covenant breach within the assessed going concern
period.
Management believes that the
combination of severe downsides to be remote, and that there are
mitigating factors over and above those built into the reverse
stress test modelling which the Board would consider to avoid a
covenant breach.
|
The selection of the assumptions for
the sensitised case is inherently subjective, and whilst the Board
considered these assumptions to reflect a downside scenario, the
future impact of economic downturn, interest rate rises or
inflating overhead costs is impossible to predict with absolute
accuracy.
Whilst the same applies to the
reverse stress test, we note that this scenario is specifically
designed to demonstrate the point at which the covenants breach
during the going concern period. The reverse stress test reflects,
in the Board's opinion, a remote circumstance and mitigating
factors could be implemented to avoid a covenant breach in this
scenario.
Scenario modelling has been
considered throughout the year and at year end by management to
formulate response options against moderate or severe downturns in
sales volumes, potential margin pressures and possible cost
challenges.
The Group's available headroom
stands at £14.0m (FY23: £29.0m) through its Revolving Credit
Facility "RCF" agreement. The Group also has an uncommitted
overdraft facility of £6.0m which remains in place and was undrawn
at the year end. Both are in place until June 2026 with the option
to extend for two further one year extensions if both parties are
agreed. With respect to the Group's stocking facilities, these have
reduced from £195.0m to £150.0m during the year which the Board
deem appropriate given current market conditions.
The Directors took action in the
year to obtain covenant relief for its RCF agreement and for one of
its stocking loan arrangements, reflecting a response to the
reduction in overall headroom against covenants in FY24. The relief
obtained has been agreed until September 2025 for the RCF and an
indefinite relaxation was agreed on the net assets covenant with
Black Horse Limited in relation to its stocking loan
facility.
In the eventuality of a period of
prolonged economic downturn resulting in material reductions in
sales volume or prices, as well as rising overhead costs, it is
possible that the Group would need to negotiate changes to its
current banking covenants, but such an extreme downturn is not
currently considered plausible.
The Group continues to consider and
monitor further potential mitigation actions it could take to
strengthen its cash position and reduce operating costs in the
event of a more severe downside scenario. Such cost reduction and
cash preservation actions would include but are not limited to:
reducing spend on specific variable cost lines including marketing
and store trading expenses; team costs, most notably sales
commissions; pausing new stock commitments; and reviewing
expansionary capital spend, dividends and share buyback
activity.
The Group has continued to
demonstrate a flexible approach to trading and despite the
constriction in the supply of nearly new vehicles, which is
expected to slowly ease, the Group has been able to use its market
position to access more stock to satisfy customer demand, both
online and in store.
The Directors have also made use of
the post year end trading performance to confirm that performance
is in line with expectation. Whilst only a short period has passed
since the year end, this evidence suggests that this is the case.
Based on this assessment, the Board confirms that it has a
reasonable expectation that the Group will be able to continue in
operation and meet its liabilities as they fall due over the period
to 31 December 2025.
The Board has determined that the
period to December 2025 constitutes an appropriate period over
which to provide its going concern assessment. This is the period
detailed in our base case model which we approve each year as part
of the strategic review. Whilst the Board has no reason to believe
the Group will not be viable over a longer period, given the
inherent uncertainty involved we believe this presents users of the
Annual Report and Accounts with a reasonable degree of confidence
while still providing a medium term perspective.
New
standards, amendments and interpretations
The Group has not early adopted
standards, interpretations or amendments that have been issued but
are not mandatory for 31 March 2024 reporting periods.
The following amended standards and
interpretations effective for the current financial year, have been
applied and have not had a significant impact on the Group's
consolidated financial statements in the current or future
reporting periods and on foreseeable future
transactions.
●
Deferred Tax related to Assets and Liabilities
arising from a Single Transaction - Amendments to IAS 12
●
Disclosure of Accounting Policies - Amendments to
IAS 1 and IFRS Practice Statement 2
●
Definition of Accounting Estimates - Amendments to
IAS 8
Basis of preparation
The financial information set out in
this document does not constitute the statutory financial
statements of the Group for the year end 31 March 2024 within the
meaning of Section 435 of the Companies Act 2006 but is derived
from the Annual Report and Accounts 2024. This financial
information is prepared in accordance with UK-adopted International
Accounting Standards and the requirements of the Companies Act 2006
as applicable to companies reporting under those standards. The
auditor has reported on the annual financial statements included
within the Annual Report and Accounts 2024 and issued an
unqualified opinion and the auditor's report did not contain a
statement under section 498 of the Companies Act 2006.
The financial statements for the
year ended 31 March 2023 have been delivered to the Registrar of
Companies and the auditor's report was unqualified and did not
contain a statement under section 498 of the Companies Act
2006.
Basis of consolidation
The consolidated financial
statements incorporate the financial statements of the Company,
entities controlled by the Company (its subsidiaries) and the
Motorpoint Group Plc Employee Benefit Trust made up to 31 March
each year.
The EBT is consolidated on the basis
that the Company has control, thus the assets and liabilities of
the EBT are included in the balance sheet and shares held by the
EBT in the Company are presented as a deduction from equity. The
EBT has been solely set up for the purpose of issuing shares to
Group employees to satisfy awards under the various share-based
schemes and has no ability to access or use assets, or settle
liabilities, of the Group.
Subsidiaries are all entities over
which the Group has control. The Group controls an entity when the
Group 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. Subsidiaries are fully
consolidated from the date on which control is transferred to the
Group. They are deconsolidated from the date that control ceases.
Intercompany transactions and balances between Group companies are
eliminated on consolidation.
2.
Segmental reporting
The Group has prepared segmental
reporting in accordance with IFRS 8 'Operating Segments'. The
Group's chief operating decision maker is considered to be the
Board of Directors. Segmental information is presented on the same
basis as the management reporting. An operating segment is a
component of the business where discrete financial information is
available and the operating results are regularly reviewed by the
Group's chief operating decision maker to make decisions about
resources to be allocated to the segment and to assess its
performance.
Operating segments are aggregated
into reporting segments to combine those with similar
characteristics.
The Group operates its omnichannel
vehicle retailer offering through a store network and separate
financial information is prepared for these individual store
operations. These stores are considered separate 'cash generating
units' for impairment purposes. However, it is considered that the
nature of the operations and products is similar and they all have
similar long term economic characteristics and the Group has
applied the aggregation criteria of IFRS 8. In addition, the Group
operates an independent trade car auction site offering a
business-to-business entirely online auction market place platform
which is assessed by the Board as a separate operation and thus
there are two reportable segments: retail (Motorpoint) and
wholesale (Auction4Cars).
|
Retail
2024
£m
|
Retail
2023
£m
|
Wholesale
2024
£m
|
Wholesale
2023
£m
|
Total
2024
£m
|
Total
2023
£m
|
|
|
|
|
|
|
|
Revenue
|
931.1
|
1,175.7
|
155.5
|
264.5
|
1,086.6
|
1,440.2
|
Cost of sales
|
(866.8)
|
(1,101.2)
|
(146.7)
|
(253.3)
|
(1,013.5)
|
(1,354.5)
|
Gross profit
|
64.3
|
74.5
|
8.8
|
11.2
|
73.1
|
85.7
|
3.
Revenue recognition
Revenue represents amounts
chargeable, net of value added tax, in respect of the sale of goods
and services to customers. Revenue is measured at the fair value of
the consideration receivable, when it can be reliably measured, and
the specified recognition criteria for the sales type has been met.
The transaction price is determined based on periodically reviewed
prices and are separately identified on the customer's invoice.
There are no estimates of variable consideration.
The transaction price for motor
vehicles and motor related services is at fair value as if each of
those products are sold individually.
(i)
Sales of motor vehicles
Revenue from the sale of retail
motor vehicles is recognised when the control has passed; that is,
when the vehicle has been collected by, or delivered to, the
customer. Payment of the transaction price is due immediately when
the customer purchases the vehicle. Sales of accessories, such as
mats, are recognised in the same way.
Revenue from the sale of wholesale
vehicles is recognised when the control has passed; that is, when
full payment has been made for the vehicle.
The Group operates a return policy
which is consistent with the relevant consumer protection
regulations. This is offered in the form of a seven day exchange
guarantee to all retail customers and a 14 day money back guarantee
for home delivery customers.
(ii) Sales of motor related services and
commissions
Motor related services sales include
commissions on finance introductions, extended guarantees and
vehicle asset protection as well as the sale of paint protection
products. Sales of paint protection products are recognised when
the control has passed; that is, the protection has been applied
and the product is supplied to the customer.
Vehicle extended guarantees and
asset protection ('GAP insurance') where the Group is not
contractually responsible for future claims, are accounted for by
recognising the commissions attributable to Motorpoint at the point
of sale to the customer.
Where the Group receives finance
commission income, primarily arising when the customer uses
third-party finance to purchase the vehicle, the Group recognises
such income on an 'as earned' basis.
The assessment is based on whether
the Group controls the specific goods and services before
transferring them to the end customer, rather than whether it has
exposure to significant risks and rewards associated with the sale
of goods or services.
|
2024
£m
|
2023
£m
|
Revenue analysis
|
|
|
Revenue from sale of motor
vehicles
|
1,037.5
|
1,370.7
|
Revenue from motor related services
and commissions
|
45.9
|
62.6
|
Revenue recognised that was included
in deferred income at the beginning of the year - Sale of motor
vehicles
|
0.2
|
3.9
|
Revenue recognised that was included
in deferred income at the beginning of the year - Motor related
services and commissions
|
3.0
|
3.0
|
Total revenue
|
1,086.6
|
1,440.2
|
4.
Operating profit / loss
Analysed as:
Operating profit / loss includes the
effect of charging:
|
2024
£m
|
2023
£m
|
Inventory recognised as
expense
|
1,007.8
|
1,345.0
|
Movement in provision against
inventory
|
0.2
|
(0.1)
|
Employee benefit expense
|
33.1
|
36.2
|
Depreciation of property, plant and
equipment and right-of-use assets
|
8.8
|
9.0
|
Amortisation of intangible
assets
|
1.1
|
0.4
|
Expense on short term and low value
leases
|
0.4
|
0.4
|
Exceptional income
|
(5.6)
|
-
|
Exceptional costs
|
7.7
|
-
|
Total expenses before exceptional
items comprise:
|
2024
£m
|
2023
£m
|
Cost of sales
|
1,013.5
|
1,354.5
|
Operating expenses:
|
|
|
Selling and distribution
expenses
|
19.4
|
23.5
|
Administrative expenses
|
53.5
|
55.7
|
Total operating expenses before
exceptional items:
|
72.9
|
79.2
|
Total expenses before exceptional
items
|
1,086.4
|
1,433.7
|
5.
Exceptional items
|
2024
£m
|
2023
£m
|
Restructuring costs
|
1.7
|
-
|
Asset write off
|
6.0
|
-
|
Insurance proceeds
|
(5.6)
|
-
|
Total exceptional items before finance expense and income
tax
|
2.1
|
-
|
6.
Earnings per share
Basic and diluted EPS are calculated
by dividing the earnings attributable to equity shareholders by the
weighted average number of ordinary shares during the
year.
|
2024
|
2023
|
Loss attributable to ordinary
shareholders (£m)
|
(8.4)
|
(0.6)
|
Weighted average number of ordinary
shares in Issue ('000)
|
90,180
|
90,190
|
Basic EPS (pence)
|
(9.3)
|
(0.7)
|
Diluted weighted average number of
ordinary shares in Issue ('000)
|
90,180
|
90,190
|
Diluted EPS (pence)
|
(9.3)
|
(0.7)
|
The difference between the basic and
diluted weighted average number of shares represents the dilutive
effect of the currently operating schemes and the vested but not
yet exercised options. This is shown in the reconciliation below.
No dilution in FY24 due to the Group making a loss for the
year.
There is a maximum of 1,440,453
additional options which have not been included in the dilutive
calculation in relation to these schemes.
|
2024
|
2023
|
Weighted average number of Ordinary
Shares in Issue ('000)
|
90,180
|
90,190
|
Adjustment for share options
('000)
|
-
|
-
|
Weighted average number of Ordinary
Shares for diluted earnings per share ('000)
|
90,180
|
90,190
|
7.
Borrowings
During the year the Company
renegotiated the terms of both its revolving credit facility and
stocking facilities, reducing available headroom from £29.0m and
£195.0m to £14.0m and £150.0m respectively. As at the reporting
date £Nil of the revolving credit facility (FY23: £Nil) and £Nil of
the overdraft (FY23: £Nil) was drawn down. The terms of the
Revolving Credit Facility and overdraft require a full repayment
for a period of at least one day or more in each financial year and
half year with no less than one month between
repayments.
The finance charge for utilising the
facility was dependent on the Group's borrowing ratios as well as
the base rate of interest in effect. During the year ended 31 March
2024 interest was charged at 6.0% (FY23: 2.4%) per annum. The
interest charged for the year of £0.7m (FY23: £0.4m) has been
expensed as a finance cost.
8.
Share capital
|
|
|
|
Number
'000
|
Amount
£m
|
Number
'000
|
Amount
£m
|
Allotted, called up and fully paid Ordinary Shares of 1p
each
|
|
|
|
|
Balance at the beginning of the
year
|
90,190
|
0.9
|
90,190
|
0.9
|
Bought back and held as treasury
shares during the year
|
(30)
|
-
|
-
|
-
|
Released from treasury to satisfy
employee share plan obligations
|
-
|
-
|
-
|
-
|
Bought back and cancelled during the
year
|
(190)
|
-
|
-
|
-
|
Balance at the end of the year
(1)
|
89,970
|
0.9
|
90,190
|
0.9
|
1 During the
year 220,255 shares were purchased by the Company in accordance
with the terms of its share buyback programme, as announced on 26
January 2024. Of these, 190,001 were cancelled as at 31 March 2024.
The shares were acquired at an average price of 131.0p per share,
with prices ranging from 133.0p to 129.0p. In the period from 1
April 2024 to 31 May 2024 972,280 shares were purchased by the
Company
The
190,001 shares bought back and cancelled represent 0.2% of the
issued Ordinary Shares, at a purchase cost of £0.3m.
There are currently 30,000 shares
held in treasury which were cancelled post year end.
Shares are held on behalf of
employees within the employee benefit trust (EBT).
The Group does not have a limited
amount of authorised capital.