Final Results
The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.
23 March 2023
Safestyle UK plc
("Safestyle" or the "Group")
Final Results
Balance sheet remains healthy and strategic investment programme initiated to position group for long-term growth .
Safestyle UK plc (AIM: SFE), the leading UK-focused retailer and manufacturer of PVCu replacement windows and doors for the homeowner market, today announces its results for financial year 20221.
Financial highlights
|
|
2022 |
2021 |
FY22 v FY21 % change |
|
Revenue (£m) |
154.3 |
143.3 |
7.7% |
|
Gross Profit (£m) |
37.9 |
43.8 |
(13.4%) |
|
Gross margin % |
24.54% |
30.54% |
(600)bps |
|
Underlying (loss) / profit before taxation2 (£m) |
(4.4) |
7.6 |
n/a |
|
Non-underlying items3 (£m) |
(4.1) |
(1.6) |
(149.6%) |
|
(Loss) / profit before taxation (£m) |
(8.5) |
6.0 |
n/a |
|
EPS - Basic (pence) |
(4.7)p |
3.5p |
n/a |
|
Net cash4 (£m) |
8.0 |
12.1 |
n/a |
|
Interim dividend per share (pence) |
0.4p |
- |
n/a |
|
Final dividend per share (pence) |
0.1p |
- |
n/a |
|
1)
2)
|
The financial statements are presented for the year ended on the closest Sunday to the end of December. This date was 1 January 2023 for the current reporting year and 2 January 2022 for the prior year. All references made throughout to the financial year 2022 are for the period 3 January 2022 to 1 January 2023 and references to the financial year 2021 are for the period 4 January 2021 to 2 January 2022. Underlying (loss) / profit before taxation is defined as reported (loss) / profit before taxation before non-underlying items and is included as an alternative performance measure in order to aid users in understanding the ongoing performance of the Group. |
|
3) |
Non-underlying items consist of non-recurring costs, share-based payments and the Commercial Agreement amortisation. |
|
4) |
Net cash is cash and cash equivalents less borrowings. |
A reconciliation between the terms used in the above table and those in the financial statements can be found in the Financial Review.
· Revenue growth of 7.7% and order book (value) over 60% ahead of pre-pandemic levels.
· Return to dividend payments, with an interim dividend paid of 0.4p per share and a final dividend proposed of 0.1p per share.
· Net cash of £8.0m with lower cost facility extended to December 2026.
· Underlying profit reduction due to the estimated c.£4m impact of a cyber-attack in Q1 and a £5m strategic investment programme (versus 2021).
Operational headlines
· Implemented £5m strategic investment programme.
· As part of investment programme, returned to TV advertising across 2022 driving 6ppts (46%) increase in unprompted brand awareness over 2021.
· Market share (as measured by Fensa) increased by 0.2ppts to 8.0% versus FY21.
· Launched the Safestyle Academy, 27 trainees have progressed through the adult fast track installer training programme with new cohorts targeted to join later in the year.
· Launched 'Role Model Depot' training programme for our installation depot management.
· Continued progress on our ESG agenda with a further 7.7% reduction in CO2 emissions per frame installed and waste to landfill 5% across the year which leaves us well positioned to achieve our 2025 sustainability targets.
Transition to new PVCu profile supplier completed at the end of the year, on time and on budget; the Group is now manufacturing products using the Liniar system.
Outlook
· The trading context of the UK economy and consumer confidence remains challenging.
· Within this context, order intake for the year to date has been variable. January was in line with management's expectations but, February and March to date have been slower than anticipated.
· Such variability is expected in the short-term and indications are that we have increased market share (as measured by FENSA) in February versus our FY2021 level.
· Our order book has increased since the start of the year, but remains at the same levels as at the end of January.
· We have continued to invest in our brand through a TV and radio campaign across February and March which is designed to amplify our value proposition and emphasise the relevance of our product at a time of high household energy costs.
· We are very focused on continuing to increase our market share and the Board plans to continue with the strategic investment agenda described at our Capital Markets Day, albeit prudently, to ensure that the year still represents a return to profitability.
· Therefore, as a result of the challenging market conditions and continued strategic investment, the Board does now expect revenue to be below current expectations and full year underlying profitability to be at least £2.0m, as a balance is struck between driving sales and the levels of investment made into the business. The medium-term strategic objectives remain unchanged.
· Notwithstanding the above, we remain confident that as the national value player operating in a historically-proven resilient sector, we are well-placed to attract consumers in these tougher economic times, increase market share and also make progress towards our medium-term financial and strategic objectives.
Commenting on the results, Rob Neale, CEO said:
"2022 was a challenging year for our business. We were forced to deal with a number unforeseeable issues which impacted our financial results and slowed the momentum we had built up through 2021. The most pleasing aspect of 2022 was the resilience our business showed to meet these challenges head on and simultaneously embark upon a significant strategic investment agenda which will set the foundations in place for our business to grow over the medium term.
During the first quarter of this financial year, we have seen variable trading patterns which reflect the difficult consumer environment across the wider economy. Whilst mindful of these conditions, the Board remains focused on increasing our market share by continuing to invest behind our strategic agenda. However, it is important to note that much of this investment is variable and the Board will use the levers available to it should market conditions dictate more prudence. Consequently, we now expect full year underlying profit to be at least £2.0m.
Notwithstanding this, we remain excited about the future of Safestyle and believe that appropriate investments made now will set us up well for growth when consumer confidence returns."
Enquiries:
|
Safestyle UK plc Alan Lovell, Non-Executive Chairman Rob Neale, Chief Executive Officer
|
via FTI Consulting |
|
Zeus (Nominated Adviser & Joint Broker) Dan Bate / James Edis (Investment Banking) Dominic King (Corporate Broking)
|
Tel: 0203 829 5000 |
|
Liberum Capital Limited (Joint Broker) Jamie Richards / Kate Bannatyne
|
Tel: 0203 100 2100 |
|
FTI Consulting (Financial PR) Alex Beagley / Sam Macpherson / Amy Goldup
|
Tel: 0203 727 1000 |
About Safestyle UK plc
The Group is the leading retailer and manufacturer of PVCu replacement windows and doors to the UK homeowner market. For more information please visit www.safestyleukplc.co.uk or www.safestyle-windows.co.uk .
Chairman's Statement
After a stable and profitable 2021, I regret that Safestyle was again hit by untoward events in 2022 - a serious cyber-attack, a hot summer affecting equipment in the factory and the political volatility of the autumn - which meant that pre-investment profit reduced to around break-even. Despite these headwinds, the Board decided to persevere with its investment plans in the interests of building sustainable profits in the medium-term; these included getting the brand back on TV, a training programme for installation colleagues, IT development and an online trading brand. The Board expects these investments to start to make a difference in 2023 but to be more obvious in later years.
Trading and financial performance
The Group delivered revenue growth of 7.7% to £154.3m over 2021, driven by pricing responses to the inflationary environment. This revenue growth would have been higher were a planned January price increase, designed to keep pace with rapidly-rising input costs, not delayed until April whilst we recovered from the cyber-attack. Consequently, these inflationary pressures across materials, energy, labour and lead generation resulted in cost of sales increasing faster than our top line revenue; gross profit reduced by 13.4% to £37.9m and gross margin percentage by 600bps to 24.5%.
The Group entered 2022 with a strong balance sheet, which the Board has used to continue to drive the investment agenda in people, training, customer service, brand development and our IT roadmap, all of which are critical to deliver on the Group's strategic priorities that were shared at the Capital Markets Day in November 2022. This investment, equating to c.£5m over 2022, is expected to underpin delivery of our medium-term performance targets, but did contribute to reduced profitability in 2022. We expect to continue with our investment agenda in 2023, albeit prudently utilising the levers at our disposal should market factors dictate more conservative investment.
Following the 2022 investment, the Group produced an underlying (loss) before taxation for the full year of £(4.4)m compared to an underlying profit in 2021 of £7.6m. After non-underlying items, reported (loss) before taxation was £(8.5)m compared to a profit of £6.0m in the prior year. Basic EPS was a loss of (4.7)p versus 3.5p last year.
Balance sheet and dividend
The net cash position at the end of the year reduced to £8.0m (2021: £12.1m) as a result of the financial performance described above.
Pleasingly - and a representation of our lender's confidence in the Group's future - the £7.5m finance facility was renewed in January 2023. This new facility runs until December 2026 in the form of a lower cost revolving credit facility. Covenants have also been renegotiated and are either untested or scale in proportion to the drawn facility.
An interim dividend of 0.4p per share (2021: £nil) was declared and paid in the year. The Board has proposed a final dividend of 0.1p per share (2021: £nil). The return to the dividend list this year represents the Board's confidence in the future of the Group and the strength of the balance sheet. A progressive dividend is part of our wider capital allocation policy. This policy includes utilising operating cashflows to reinvest behind the strategic priorities of the Group as well as assessing opportunities to accelerate growth through acquisitions and new business development.
Sustainability
I can report that our focus on sustainability in all the Group's operations has yielded further progress during 2022. The Group maintained its performance in recycling 95% of all waste generated from all processes, including materials removed from a customer's home during an installation. We continue to believe this is the highest level in the industry.
We are also continuing to make strong progress towards our targets for CO2 emissions per frame installed. Last year, I reported that we had exceeded our original targeted reduction in this measure three years earlier than planned. Consequently, we reset our target for a further reduction of 6% before 2025. I am pleased to report that we are well on track to achieving this target having achieved, before carbon offsetting credits, a 2.0% reduction in CO2 emissions per frame installed versus 2021. This year's reductions have been achieved through further moves to renewable energy, ongoing energy usage reduction programmes across the Group and increased collaboration with suppliers.
Vehicle emissions now account for well over 80% of the Group's total emissions and therefore the key remaining breakthrough required is to electrify the Group's vehicle fleet to which we added a further six electric vehicles in 2022. However, the largest segment of our fleet are our commercial vans and we require improved vehicle range as well as an improved charging infrastructure before we can fully transition to electric-powered vehicles.
As we target reductions in our emissions, we are also working with partners on various sustainability programmes including carbon offset programmes. I am pleased to report that we offset 247 tonnes of carbon emissions at the end of last year. Taking this into account, our CO2 emissions per frame installed reduced by 7.7% versus 2021.
The Group's pre and post carbon offset credits emissions per frame performance will continue to be reported to show progress as we work to reduce emissions as much as possible with current technology and renewable energy and then additionally show any benefit achieved through offsetting residual emissions with Gold Standard carbon offsets.
Board changes
At the end of the year, our previous CEO Mike Gallacher retired having led Safestyle through the Safeglaze saga in 2018, successfully navigated the global pandemic as well as overcoming the challenges described above in 2022. I once again thank Mike for his commitment to our people and our business during these turbulent times and we wish him and his family well for the future.
Consistent with our plans for succession, the Board appointed Rob Neale, who has been our CFO for four and a half years, to the role of CEO following Mike's retirement. The Board and I are confident in Rob's leadership ability and we look to the future positively as the business continues to target delivery against its strategic objectives.
On 1 March 2023, the Board appointed Michelle Williams, who has been Safestyle's HR Director since 2017, to the Board as Chief People Officer. Safestyle's people represent a core enabler of our strategic priorities and Michelle's appointment reflects that. Michelle has built a deep understanding of our people, our business and our industry and we look forward to her ongoing contribution to the Group as a Board director.
Finally, the search process for a new CFO is well advanced and we will provide an update on this in due course.
Safestyle's people
Once again I conclude by recognising the hard work of all our people at Safestyle. 2022 had some unexpected events that tested our people who responded with passion, skill and resilience. Alongside overcoming numerous challenges, they also contributed to progress made with the foundations that I am confident will deliver future success.
I believe that Safestyle's team continue to make the difference and I look to the future with confidence.
Alan C Lovell
Chairman
22 March 2023
CEO's Statement
We began 2022 with the clear intention of building on the progress made over the last few years as we emerged from a period of sustained turbulence whilst also initiating a multi-year strategic investment programme. I am pleased to report that we achieved the latter, making significant steps forward in a programme to achieve our medium-term objectives. Despite clear progress in this regard, it has been frustrating that our financial performance was hindered by unforeseen events that represented a series of new challenges to overcome in the year. Whilst disappointing, it highlights the progress that we have made as a business over the past few years that we were able to continue with our strategic investment programme despite the headwinds we faced in 2022.
Before I expand on the year, it is most important to recognise that Safestyle's people have once again demonstrated that they possess all the qualities needed to ensure that the business ended the year ready to press ahead in 2023. Their loyalty, resilience, teamwork and determination have all once again come to the forefront throughout the year as they stared into the challenges presented to the business. I am proud to lead a strong team and look forward to continuing working with them and all stakeholders as we drive Safestyle towards our shared goals.
2022 headlines
2022 had barely begun before our promising momentum from 2021 was interrupted when, on 25 January 2022, the business was the subject of a highly-sophisticated cyber-attack which originated from Russia; at this point we became one of many businesses impacted by such an incident. Our people's immediate response was impressive and we were able to maintain our core operations, sales, surveying, manufacturing and installations although they were all hampered during the recovery period which took us into Q2 before operations were back to business as usual.
Inevitably, the disruption impacted our ability to service our customers at the high levels we set ourselves. As we moved into early summer, our typically reliable factory encountered issues attributable to the extraordinary heatwave in July. This caused operational, fulfilment and service issues for the next two months. Enhanced measures are now in place to ensure that if we experience similar temperature levels in the future, the same impact will not arise.
The economic and consumer outlook worsened as we moved into H2. Consumer confidence levels were reportedly at a 40-year low and inflation at a corresponding record high. We brought forward our next wave of TV advertising and looked to leverage our clear value proposition, the relevance of our product at a time of high household energy costs, market-leading finance options and a credible 10-year warranty.
However, despite our actions, order intake across the period from late September to the end of October was volatile. We attributed this to the political and economic news cycle of the period, which we believe had a direct, adverse impact on consumer confidence. Order intake (value) across this period was 2.7% lower than the prior year whilst, at the same time, the Group experienced higher costs of acquisition than prior years due to the challenging market context. Demand improved in early November which resulted in order intake (value) returning to expected levels and growing by over 30% year on year across the first three weeks of November with lead generation costs also returning to normalised levels.
This trading volatility had an adverse impact on the financial performance for the year, resulting in lower installation volume levels in Q4 as well as margin being diluted due to higher costs of lead generation. On a more positive note, the improved order intake later in the year resulted in an order book that closed the year significantly ahead of our original expectations, being only slightly lower than the record levels of the last two years and over 60% higher than pre-pandemic closing order book levels.
A final significant event of 2022 followed an extensive selection process and careful deliberation by the Board which led to notice being served on our existing PVCu profile supplier and a transition plan to a new supplier, Liniar, being enacted. I am pleased to report that this complex project was well-managed within a demanding timescale and the transition was successfully completed on time and on budget over the Christmas period. This represents one of many examples where we have made progress on strengthening the fundamentals of the business despite the challenging events of the year described above.
Financial performance
O ur financial performance, especially in the first half of the year, was materially impacted by the cyber-attack at the end of January. The Group's revenue delivery of £154.3m represented 7.7% growth over 2021. This revenue was achieved despite a delay to a planned pricing change designed to keep pace with inflationary cost push having to be delayed by three months due to the cyber-attack.
Installation volumes declined over 2021 by 2.6% to 178,652 with the cyber-attack and trading volatility later in the year both impacting our performance. Despite this volume decline, latest figures from FENSA suggest that our 2022 market share marginally increased versus 2021; this is encouraging given some of the volume challenges were unique to us and provides confidence that ongoing market share gains are achievable as we deliver on our strategic priorities.
Moving beyond topline performance, input costs in the year represent the highest levels of inflation in many years, increasing year on year by over 30% in some areas. The main drivers were rising energy costs being passed on by our suppliers as well as higher raw material, staffing and fuel costs. Our buying power and longer-term contracts with fixed pricing mitigated some of these effects for part of the year. We continue to move proactively to mitigate the impact of these costs on our margins through price changes, while remaining conscious of our value proposition in the market alongside careful cost management.
2022 also represented a step-change in our investment programme as part of our medium-term plans to modernise the business, drive growth, provide a great customer service, reduce adverse quality costs and drive financial performance over the medium-term. This investment represented an increase in operating expenses in the year versus 2021 of c.£5m which includes £2.5m of TV spend, alongside further growth in people costs, IT, training and customer service investment. Our strong cash position has supported this activity.
The Group's underlying (loss) before taxation for the full year was £(4.4)m compared to an underlying profit in 2021 of £7.6m. The majority of the year on year difference can be attributed to the adverse impact on profits of the cyber attack which is estimated at c.£4m (largely due to the pricing delay described above) and the year on year investments in our strategic priorities of c.£5m.
Dividend
We were pleased to report a return to dividend payments in our interim results, confirming an interim dividend of 0.4p per share (2021: £nil). Despite the challenges faced, we remain confident about the future and it remains our intention to adopt a progressive dividend policy going forward. We have declared a final dividend of 0.1p per share (2021: £nil) which brings the total dividend for the year to 0.5p per share. Further details of the dividend, including a dividend timetable, are included in the Financial Review further below.
Strategic priorities
The Group shared its strategic priorities and objectives at its Capital Markets Day in November 2022. At this event, the management team provided details of its programme that it will focus on in order to deliver its strategy and medium-term financial targets.
For 2022, the strategic investment programme delivered the following specific activities:
Accelerating growth : In a highly-fragmented market, the opportunity to grow the business is clear. Driving brand awareness is a key element of our accelerating growth strategy. From 2018 until the start of 2022, brand investment had been significantly curtailed, driving up digital marketing costs and causing erosion of our national brand awareness. We returned to TV advertising in February 2022 with a second wave beginning in August 2022 with a campaign that communicated a new, modernised 'Safestyle Saves' brand proposition fronted by David Seaman MBE, the former England goalkeeper.
Alongside the above the line investment described above, which totalled £2.5m in 2022, we have continued to make significant progress leveraging our scale in digital marketing excellence, supported by our class-leading agency that we appointed in 2020. Increasing the use of Artificial Intelligence ('AI') and other search and conversion optimisation strategies will continue to be essential to help offset what are rising levels of digital marketing rate inflation.
We aim to combine the above key pillars with rigorous customer insights and targeted expansion of our geographical presence to drive our accelerating growth strategy in the coming years.
Transforming the customer experience: Our mission is to deliver a great customer experience every time for our thousands of customers. Our approach is based on designing and implementing robust business processes, supported by modern IT systems and effective training to provide speed, ease, certainty and empathy in everything we do. This is a phased multi-year initiative, which supports growth and reduces cost. Our focus in 2022 was on investing in customer service levels as we modernise our call centre, drive improvements in our complaints handling procedures as well as implementing Net Promoter Score ('NPS') across the installations network.
Driving performance: This strategic priority targets delivering consistency and improved results through standardisation, training, best practice alignment and innovation across our three initiatives of 'getting it right', 'levelling up' and 'capacity and productivity.'
We need to ensure that as our business grows, we have developed and implemented Standard Operating Procedures ('SOP's) that reduce the range of operational performance that exists across our network. In 2022, we launched our new SOPs across our installations network and also developed and began the roll out of our first 'Role Model Depot' training programme for depot management. This training will be deployed across our installations management population into 2023.
A key element of this strategy has been the launch of the Safestyle Academy. In 2022, 27 trainees have progressed through the adult fast-track installer training programme which is a structured, practical training programme with over 90% delivered on-the-job. This programme is now starting to deliver 'graduates' of well-trained window fitters to the business, addressing the current skill shortages across the UK and embedding the Safestyle approach to customer service. We target further new cohorts to join later in the year alongside deploying the Academy to other areas of the business.
Leveraging sustainability and embedding compliance: I am delighted that we have sustained progress in our environmental agenda. Our waste to landfill performance remains at 5%. Furthermore, having increased targets following early achievement last year, w e remain well on track to achieve our 2025 targets following a further 2.0% reduction in CO2 emissions per frame installed versus 2021. This performance is before taking into account our new carbon offset partnership programme.
We have engaged with our largest suppliers with regards to their sustainability agenda and have started several working parties sharing best practices and learnings as we continue to focus on reducing the impact of our business on the environment. Included within these initiatives is a new offset programme that started at the end of the year which totalled 247 tonnes of carbon credits. Taking this into account, our CO2 emissions per frame installed reduced by 7.7% versus 2021. As reported in the Chairman's statement, we will continue to report pre and post-carbon offset performance to clearly capture progress on reducing our own emissions as well as the impact of offset initiatives.
We have greatly-improved our compliance record over the last five years. Our health and safety performance remains excellent and our membership to the Association of Professional Sales has been renewed. Regular inspections and audits throughout the year have maintained our focus on our compliance responsibilities.
We also have two enablers to delivery of our strategic priorities:
IT : Our IT strategy is designed to drive productivity, improve the customer experience, support growth and reduce cost. Modernisation of our systems helped to mitigate the impact of the cyber-attack we experienced in Q1. Alongside a successful recovery from this, good progress has been made on our medium-term IT Roadmap delivering new capabilities through enhancements to core systems alongside more foundational work that is part of our longer-term journey.
People: 2022 represents a year where we have made good progress on many aspects of our People agenda. We have made steps to build a working environment that welcomes and encourages diversity. We have continued to successfully recruit, train and retain talent in our business. Achievements include our Training Academy scheme, SOP deployment, compliance and cyber security training and over 96% of our installers achieving the 'Minimum Technical Competency.' The latter is something that FENSA reported as industry-leading in their 2022 annual report.
As we aim to continue to develop these established programmes in 2023, we will also add further innovative components. Finally, we were delighted to welcome Michelle Williams to the Board as Chief People Officer on 1 March and I look forward to continuing to work with her as we continue to develop our Safestyle People Brand.
New business development
During the year, we launched our new concept brand - Beam - as a digital channel-only brand. The proposition currently focusses purely on a composite door range offering. During 2022 and into early 2023, we have been running numerous test and learn programmes to understand more about how this business model operates. We aim to comprehend how we can provide, through a digital platform, what consumers require despite the infrequent, bespoke nature and technical complexity that most consumers naturally find daunting. New businesses such as this represent opportunities to access additional consumers and can complement our existing core Safestyle value brand.
Business outlook
The trading context of the UK economy and consumer confidence remains challenging. Inflation currently remains at over 10% which combines with the impact of higher interest rates to put pressure on consumers' disposable income. The CPA Construction Industry Forecasts (Autumn 2022) predicts that the private housing repair, maintenance and improvement market ('RMI') will fall by 9% in 2023 before returning to 1% growth in 2024.
Within this context, order intake for the year to date has been variable. January was in line with management's expectations, but February and March to date have been slower than anticipated. Such variability is expected in the short-term and indications are that we have increased market share (as measured by FENSA) in February versus our FY2021 level. Our order book has increased since the start of the year, but remains at the same levels as at the end of January.
We have continued to invest in our brand through a TV and radio campaign across February and March which is designed to amplify our value proposition and emphasise the relevance of our product at a time of high household energy costs. This proposition is supported by market-leading finance options and a credible 10-year warranty that has recently been extended to 15 years for the double-glazing unit.
We expect largely to mitigate the impact of weaker trading on our revenues through management of our cost base. In what appears to be a tougher market expected this year, we are very focused on continuing to increase our market share and the Board plans to continue with the strategic investment agenda described at our Capital Markets Day, albeit prudently, to ensure that the year still represents a return to profitability. This continued investment, much of which is variable, is a key part of the Group's growth agenda. Therefore, as a result of the challenging market conditions and continued strategic investment, the Board does now expect revenue to be below current expectations and full year underlying profitability to be at least £2.0m as a balance is struck between driving sales and the levels of investment made into the business. The medium-term strategic objectives remain unchanged.
Alongside our financial targets for the year, we have set a number of targets across all our strategic priorities and enablers to be able to measure and share the progress this year towards achieving all our medium-term plans.
· Against our accelerating growth plans, we aim for a further increase in unprompted brand awareness, opening new sales branches and to also grow our market share versus FY22.
· To progress on transforming the customer experience , we target an installation 'On Time In Full' ('OTIF') improvement, a reduction in open complaints and improvement in our contact centre call answer rate.
· As we drive operational performance , our goals are that all installation depot management have completed role model depot training, factory output per hour worked increases and that our exit rate cost of quality has reduced over 2022.
· Our sustainability targets for FY23 on the journey to our 2025 goals are to achieve waste to landfill of 3.5%, a mileage per frame installed reduction and a further 1.5% CO2 per frame reductions.
· For our two enablers, starting with our People initiatives, we target an increase in our gender balance of women / men as well as reducing our employee turnover. Within IT our objectives are to deliver further Safestyle and Beam website developments, a new HR system and to be progressing with our multiyear CRM programme.
In summary, and notwithstanding the current uncertainties regarding consumer confidence, we remain confident that as the national value player operating in a historically-proven resilient sector, we are well-placed to attract consumers in these tougher economic times, increase market share and also make progress towards our medium-term financial and strategic objectives. I look forward to providing an update on our progress towards these objectives throughout the year.
Rob Neale
Chief Executive Officer
22 March 2023
Financial Review
|
|
2022 |
2021 |
|
||||
|
|
Underlying |
Non-underlying items1 |
Total |
Underlying |
Non-underlying items1 |
Total |
Change in underlying % |
|
Financials |
£000 |
£000 |
£000 |
£000 |
£000 |
£000 |
|
|
|
|
|
|
|
|
|
|
|
Revenue |
154,315 |
|
154,315 |
143,251 |
|
143,251 |
7.7% |
|
Cost of sales |
(116,441) |
|
(116,441) |
(99,496) |
|
(99,496) |
(17.0%) |
|
Gross profit |
37,874 |
|
37,874 |
43,755 |
|
43,755 |
(13.4%) |
|
Other operating expenses2 |
(40,546) |
(4,118) |
(44,664) |
(34,519) |
(1,650) |
(36,169) |
(17.5%) |
|
Operating (loss) / profit |
(2,672) |
(4,118) |
(6,790) |
9,236 |
(1,650) |
7,586 |
n/a |
|
Finance costs |
(1,756) |
|
(1,756) |
(1,623) |
|
(1,623) |
(8.2%) |
|
(Loss) / profit before taxation3 |
(4,428) |
(4,118) |
(8,546) |
7,613 |
(1,650) |
5,963 |
n/a |
|
|
|
|
|
|
|
|
|
|
Taxation |
|
|
2,035 |
|
|
(1,188) |
|
|
|
|
|
|
|
|
|
|
|
(Loss) / profit for the year |
|
|
(6,511) |
|
|
4,775 |
|
|
|
|
|
|
|
|
|
|
|
Basic EPS (pence per share) |
|
|
(4.7)p |
|
|
3.5p |
|
|
Diluted EPS (pence per share) |
|
|
(4.7)p |
|
|
3.4p |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
12,369 |
|
|
16,351 |
|
|
Borrowings |
|
|
(4,372) |
|
|
(4,231) |
|
|
Net Cash4 |
|
|
7,997 |
|
|
12,120 |
|
|
KPIs |
2022 |
2021 |
Change % |
|
Gross margin %5 |
24.5% |
30.5% |
(600)bps |
|
Average Order Value (£ inc VAT) |
4,337 |
4,032 |
7.6% |
|
Average Frame Price (£ ex VAT) |
871 |
791 |
10.1% |
|
Frames installed - units |
178,652 |
183,374 |
(2.6%) |
|
Orders installed |
43,050 |
43,167 |
(0.3%) |
|
Frames per order |
4.15 |
4.25 |
(2.4%) |
As reported in the CEO's statement, the Group experienced several unforeseen challenges with a cyber-attack, record high summer temperatures causing disruption to customer fulfilment and political instability in the UK causing trading turbulence in the latter part of the year all adversely impacting the financial results for the year. More pleasingly, demand improved into November which resulted in a stronger closing order book than expected which will support revenues in 2023. In addition, the Group invested c.£5m over 2021 in its strategic priorities as it focuses on its medium-term objectives.
As a result of the above, the Group made an underlying loss before taxation of £(4.4)m for the year. Net cash ended the year at £8.0m (2021: £12.1m), with the reduction in line with the trading performance for the year. As part of its capital allocation policy, the Group paid an interim dividend of 0.4p per share (2021: £nil) and has declared a final dividend of 0.1p per share (2021: £nil).
This Financial Review details the changes in the financial measures and KPIs of the business across the year within the above context and draws particular attention to the comparison with 2021.
Financial and KPI headlines
· Revenue increased to £154.3m, growth of 7.7% over 2021.
· Frames installed decreased by 2.6% to 178,652, with the decline attributable to the cyber-attack, manufacturing disruption caused by record summer temperatures and lower consumer enquiries during the period of political instability in late Q3 / early Q4.
· The Group continues to improve average frame price, achieving a 10.1% increase in the year due to necessary price increases to negate input cost inflation. This average price improvement was achieved despite a slightly reduced mix of higher average-priced composite guard doors which was 6.8% in 2022 compared to 7.3% in 2021.
· The Group also made changes to its consumer finance portfolio which has both maintained a strong promotional finance offering and also resulted in a reduction in finance subsidies of £0.5m.
· Gross profit reduced by 13.4% to £37.9m which is largely attributable to lower volume, inflationary cost push and the cost of growing the order book at increased rates. Gross margin percentage5 decreased by 600bps vs 2021 to 24.5% with the largest single contributor being the delay of a planned price increase, to recover input cost inflation, due to the cyber-attack.
· Underlying other operating expenses2 for the year increased by £6.0m (17.5%) over 2021. The £2.5m investment in TV, the full year cost of the Safestyle Technical Training Academy which opened in November 2021, salary inflation and the ongoing investment in IT and customer service are the key components of the increase.
· Finance costs have increased year on year as a result of the movement in LIBOR rate increasing the borrowing facility costs. This was offset somewhat by reduced interest rate costs on leased liabilities.
· Underlying (loss) / profit before taxation3 was £(4.4)m for the year (2021: profit of £7.6m) with lower installation volume, inflationary costs and the continuation of our strategic investment agenda all contributing to the loss and reduction versus 2021.
· Non-underlying items were £4.1m for the period (2021: £1.7m), full details of which are provided on the following pages of this Financial Review and therefore reported (loss) / profit before taxation was £(8.5)m versus a profit of £6.0m in 2021.
· Net cash4 reduced to £8.0m versus £12.1m at the end of last year which reflects the trading performance described above and after an interim dividend payment of £0.6m.
|
1 See the non-underlying items section in this Financial Review 2 Underlying other operating expenses are defined in the 'Underlying performance measures' section below and the reconciliation between this measure and the GAAP measure is shown in the 'Financials' table at the front of this Financial Review 3 Underlying (loss) / profit before taxation is defined in the 'Underlying performance measures' section below and the reconciliation between this measure and the GAAP measure is shown in the 'Financials' table at the front of this Financial Review 4 Net cash is cash and cash equivalents less borrowings 5 Gross margin % is gross profit divided by revenue |
Underlying performance measures
In the course of the last five years, the Group has encountered a series of unprecedented and unusual challenges. Consequently, adjusted measures of underlying other operating expenses and underlying (loss) / profit before taxation have been presented as the primary measures of financial performance. Adoption of these measures results in non-underlying items being excluded to enable a meaningful evaluation of the performance of the Group compared to prior periods.
These alternative measures are entirely consistent with how the Board monitors the financial performance of the Group and the underlying (loss) / profit before taxation is the basis of performance targets for incentive plans for the Executive Directors and senior management team.
Non-underlying items consist of non-recurring costs, share based payments and Commercial Agreement amortisation. A full breakdown of these items is shown below. Non-recurring costs are excluded because they are not expected to repeat in future years. These costs are therefore not included in the Group's primary performance measures as they would distort how the performance and progress of the Group is assessed and evaluated.
Share based payments are subject to volatility and fluctuation and are excluded from the primary performance measures as such changes year to year would again potentially distort the evaluation of the Group's performance year to year.
Finally, Commercial Agreement amortisation is also excluded from the primary performance measures because the Board believes that exclusion of this enables a better evaluation of the Group's underlying performance year to year.
Revenue
Revenue for 2022 was £154.3m compared to £143.3m for 2021, representing an increase of 7.7%. This was driven by price rises implemented to cover the significant inflationary cost increases that the Group experienced during the year.
Frames installed volume reduced by 4,722 (2.6%) versus 2021 to 178,652 frames. The revenue improvement exceeds the volume performance as a result of improvements in the following areas:
· The average frame price increased by 10.1% to £871 (2021: £791). This was the result of several price rises during 2022 that were necessary as the Group sought to pass on the significant material and other cost inflation. As referenced in the CEO's statement, planned price increases this year were delayed until Q2 as a result of the cyber-attack; the result being that despite the year on year increase, our average frame price exit rate is markedly higher than the average for the year.
· The growth in the average frame price was also despite a reduced mix of higher average-priced composite guard doors which reduced to 6.8% of installed volumes (2021: 7.3%).
· The above favourable average price gains were augmented by a further year on year reduction in the finance subsidy costs linked to our consumer finance offering. These reductions follow changes to our promotional finance portfolio which generated a £0.5m benefit in the year. The Group remains focused on ensuring we have a market-leading set of payment options available to customers.
· The average number of frames per order reduced by 2.4% to 4.15. The reduction in this metric was largely in H2 which we attribute to reduced consumer confidence as a result of the well-reported economic uncertainty and cost of living increases in the UK.
· Finally, as a result of price gains being partially offset by lower average frames per order, the average order value improved by 7.6% to £4,337.
Gross profit
Gross profit was £37.9m, a reduction of 13.4% over 2021, while the gross margin percentage declined by (600)bps to 24.5% (2021: 30.5%). Gross margin percentage was significantly reduced as a result of the delayed price rise described above, significant inflationary material cost increases, higher costs of lead generation and a comparatively (to last year) smaller reduction over the year in the order book. Further detail on these factors is as follows:
· The closing order book reduced marginally by 2.7% year on year; it still remains high compared to pre-pandemic levels. By comparison, the order book reduced by 8.4% in 2021 which combined with unusually low lead costs in the first half of 2021 to boost gross margin percentage that year.
· Alongside the order book changes described above, the cost of lead generation increased versus 2021 which was buoyed by a strong consumer response following the restart of all selling activities when the third national COVID lockdown was ended in early 2021. The consequential rate impact over the full year equates to a £5.1m year on year increase.
· Finally, the inflationary cost increases linked to PVCu profile, glass, installation materials, scaffolding, labour and contractor costs represent a year on year rate increase of £10.2m which was recovered through sales price rises implemented during the year.
Underlying other operating expenses
Underlying other operating expenses were £40.5m which includes TV investment of £2.5m and is an increase of £6.0m (17.5%) over 2021. Excluding the TV spend, which is a key element of rebuilding our brand to support the strategic initiative of accelerating growth, the increase of other operating expenses was £3.5m (10.2%). The key factors behind this increase are as follows:
· Wage inflation including the increase in employers' national insurance rates represents a key driver of the year on year cost increase. The costs of a 3% annual payrise for most staff have been incurred alongside higher percentage increases for a number of colleagues to underpin attraction and retention of people at all levels of the organisation. In the second-half of the year, additional payments were made to staff on fixed earnings in the form of an energy supplement to support the rapidly-increasing cost of living.
· In line with the Group's strategic priorities, we have continued to grow our customer service resource levels and invest in installations capacity in the last 18 months through the opening of a new depot in Milton Keynes (August 2021). The opening of the Safestyle Training Academy in November 2021 represents an investment to develop a pipeline of professionally trained installers, surveyors and service engineers. Increased operational headcount alongside the factors above are the other main drivers of the year on year increase in operating expenses.
· Finally, the Group continues its ongoing investment in IT and customer service as key enablers of the Group's strategic priorities. The ongoing investment in upgrading and implementing new IT systems is a critical enabler of our priorities. These investments have already delivered benefits that proved essential in helping to mitigate the full potential impact of the cyber‐attack in January 2022.
Underlying (loss) / profit before taxation
Underlying (loss) before taxation was £(4.4)m (2021: profit of £7.6m). This loss is before the non-underlying items described below.
Non-underlying items
A total of £4.1m has been separately treated as non-underlying items for the year (2021: £1.7m).
The current year consists of £3.6m of non-recurring costs (2021: £0.5m), a £0.0m share based payment charge (2021: £0.7m) and £0.5m (2021: £0.5m) of Commercial Agreement (intangible asset) amortisation. The table below shows the full breakdown of these items:
|
|
2022 |
2021 |
|
|
£'000 |
£'000 |
|
Holiday pay accrual |
(46) |
(79) |
|
RSA related costs |
- |
147 |
|
Litigation costs |
131 |
90 |
|
Restructuring and operational costs |
473 |
300 |
|
Modification of right-of-use assets and liabilities |
(113) |
(83) |
|
Impairment of right-of-use assets |
27 |
122 |
|
IT project impairment |
- |
14 |
|
Cyber incident related costs |
953 |
- |
|
Operational project costs |
1,663 |
- |
|
Previous CEO retirement costs |
556 |
- |
|
|
|
|
|
Total non-recurring costs ( note 6) |
3,644 |
511 |
|
|
|
|
|
Equity settled share based payment charge |
22 |
687 |
|
Commercial Agreement amortisation |
452 |
452 |
|
|
|
|
|
Total non-underlying items |
4,118 |
1,650 |
The holiday pay accrual release represents a release for part of an accrual made at the end of 2020 which arose as a result of the impact of the shutdown of operations and resultant extension of 2020 leave entitlement until March 2023 for some employees. This increased the level of deferred holiday entitlement of our people at the end of 2020 which was recognised as an accrual in 2020 and will reverse fully in 2023. This item was excluded from the Group's underlying performance measures to ensure performance of the business is not skewed both the expense in 2020 or its subsequent use.
£1.0m of separately identifiable cyber incident-related costs are included in non-recurring costs in relation to the incremental costs incurred as part of the recovery from the cyber-attack.
At the end of 2022 the Group transitioned to a new provider of PVCu profile, Liniar. The Group incurred a one-off cost of £1.7m due to the incremental costs of transitioning to the new profile and the impairment of the remaining stock held that was specific to the old profile which will no longer be sold to customers.
The Group incurred £0.5m (2021: £0.3m) of restructuring and non-recurring operational costs.
The charge of £0.6m represents the costs of treatment of Mike Gallacher's remuneration arrangements following his retirement from the Board on 14 December 2022. More details can be found in the Directors' Remuneration Report in the Annual Report.
As reported in the last four years, the Commercial Agreement is an agreement entered into with Mr M Misra which encompassed a five year non-compete agreement and the provision of services by Mr Misra in support of the continued recovery of Safestyle. The Group agreed consideration with Mr Misra subject to the satisfaction of both clear performance conditions by him over five years and Safestyle's trading performance in 2019.
The non-compete element of the Commercial Agreement was accounted for as an intangible asset on the basis that it is an identifiable, non-monetary item without physical substance, which is within the control of the entity and is capable of generating future economic benefits for the entity. The intangible asset was measured based on the fair value of the consideration that the Group expects to issue under the terms of the agreement and is being amortised over 5 years which matches the term of the non-compete arrangement.
Share based payment charges reduced significantly versus 2021 predominantly due to the charges incurred when the Restricted Share Award granted in October 2020 that vested in June 2021.
The items classified as non-recurring costs in the Consolidated Income Statement, the share based payment charges and the amortisation of the intangible asset created as a result of the Commercial Agreement reached in 2018 have all been excluded from the underlying (loss) / profit before taxation performance measure to enable a meaningful evaluation of the performance of the Group from year to year.
Earnings per share
Basic earnings per share were a loss of (4.7)p for the year compared to a profit of 3.5p for 2021. The basis for these calculations is detailed in note 7.
Net cash and cashflow
The Group's net cash reduced by £4.1m during the year, closing at £8.0m compared to £12.1m at the end of 2021. £4.5m of the Group's £7.5m borrowing facility, being that of the term loan, remained drawn at the year end with the £3.0m revolving credit facility undrawn.
The facility, which was due to expire in October 2023 was replaced in January 2023 with a £7.5m revolving credit facility that can be utilised as required to support working capital needs. This facility is in place until 31 December 2026. As a result, the £4.5m term loan was repaid in January 2023.
Net cash inflow from operating activities, including the cashflow impact of non-underlying items, was a £1.6m inflow (2021: £9.6m inflow). The inflow for the period, although reduced versus the prior year due to the losses as described above, reflects the strong operating cashflow model of the Group and benefits from favourable working capital movements in the year.
Capital expenditure of £1.4m increased from £1.2m in 2021 with the Group continuing to invest in its IT systems to support the strategic roadmap.
During the year the Group returned to the Dividend list and paid an interim dividend of 0.4p per share resulting in a £0.6m outflow (2021: nil).
Dividends
The Board has approved a final dividend of 0.1p per share (2021: £nil) following an interim dividend of 0.4p (2021: £nil). As reported previously, the Group's capital allocation policy is to firstly utilise surplus cash to fund forthcoming strategic initiatives. Subsequent to that, the policy is to return surplus cash to shareholders through the restoration of a progressive dividend followed by buyback programmes and latterly, special dividends in order to maximise returns to our shareholders.
The return to payment of dividends this year signals the Board drawing a line under the turbulence of the past few years and the Board reaffirms its commitment to adopt a progressive dividend policy from here. The final dividend will be paid on 1 June 2023 to shareholders on the register on 5 May 2023 and will have an ex-dividend date of 4 May 2023.
Rob Neale
Chief Executive Officer
22 March 2023
Consolidated Income Statement for the year ended 1 January 2023
|
|
|
|
|
|
2022 |
|
2021 |
|
|
|
|
|
Note |
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
|
4 |
154,315 |
|
143,251 |
|
|
Cost of sales |
|
|
|
(116,441) |
|
(99,496) |
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
|
|
37,874 |
|
43,755 |
|
|
Expected credit losses expensed |
|
|
|
(293) |
|
(362) |
|
|
Other operating expenses1 |
|
|
|
(44,371) |
|
(35,807) |
|
|
|
|
|
|
|
|
|
|
|
Operating (loss) / profit |
|
|
|
(6,790) |
|
7,586 |
|
|
Finance costs |
|
|
|
(1,756) |
|
(1,623) |
|
|
|
|
|
|
|
|
|
|
|
(Loss) / profit before taxation |
|
|
|
(8,546) |
|
5,963 |
|
|
|
|
|
|
|
|
|
|
|
Underlying (loss) / profit before taxation before non-recurring costs, Commercial Agreement amortisation and share based payment charges |
|
|
|
(4,428) |
|
7,613 |
|
|
Non-recurring costs |
|
|
6 |
(3,644) |
|
(511) |
|
|
Equity settled share based payments charges |
|
|
|
(22) |
|
(687) |
|
|
Commercial Agreement amortisation |
|
|
|
(452) |
|
(452) |
|
|
(Loss) / profit before taxation |
|
|
|
(8,546) |
|
5,963 |
|
|
|
|
|
|
|
|
|
|
|
Taxation |
|
|
|
2,035 |
|
(1,188) |
|
|
|
|
|
|
|
|
|
|
|
(Loss) / profit after taxation |
|
|
|
(6,511) |
|
4,775 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic (pence per share) |
|
|
7 |
(4.7)p |
|
3.5p |
|
|
Diluted (pence per share) |
|
|
7 |
(4.7)p |
|
3.4p |
¹ Other operating expenses includes £3,644k (2021: £511k) of non-recurring costs, £452k (£2021: £452k) of Commercial Agreement amortisation and £22k (2021: 687k) of share based payments charges. Adjusting for these gives underlying other operating expenses of £40,253k (2021: £34,157k). See Financial Review for details.
There is no other comprehensive income for the year. 2021 represents the year ended 2 January 2022.
All operations were continuing throughout all years.
Consolidated Statement of Financial Position at 1 January 2023
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
2021 |
|
|
|
Note |
£000 |
|
|
£000 |
|
Assets |
|
|
|
|
|
|
|
Intangible assets - Trademarks |
|
|
504 |
|
|
504 |
|
Intangible assets - Goodwill |
|
|
20,758 |
|
|
20,758 |
|
Intangible assets - Software |
|
|
1,305 |
|
|
870 |
|
Intangible assets - Other |
|
|
380 |
|
|
832 |
|
Property, plant and equipment |
|
|
10,024 |
|
|
10,811 |
|
Right-of-use assets |
|
10 |
9,416 |
|
|
11,146 |
|
Deferred taxation asset |
|
|
2,984 |
|
|
1,053 |
|
|
|
|
|
|
|
|
|
Non-current assets |
|
|
45,371 |
|
|
45,974 |
|
|
|
|
|
|
|
|
|
Inventories |
|
8 |
3,939 |
|
|
5,298 |
|
Current taxation |
|
|
114 |
|
|
- |
|
Trade and other receivables |
|
|
5,106 |
|
|
4,880 |
|
Cash and cash equivalents |
|
|
12,369 |
|
|
16,351 |
|
|
|
|
|
|
|
|
|
Current assets |
|
|
21,528 |
|
|
26,529 |
|
|
|
|
|
|
|
|
|
Total assets |
|
|
66,899 |
|
|
72,503 |
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
Called up share capital |
|
|
1,389 |
|
|
1,386 |
|
Share premium account |
|
|
89,495 |
|
|
89,495 |
|
Profit and loss account |
|
|
3,856 |
|
|
10,893 |
|
Common control transaction reserve |
|
|
(66,527) |
|
|
(66,527) |
|
|
|
|
|
|
|
|
|
Total equity |
|
|
28,213 |
|
|
35,247 |
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
Trade and other payables |
|
9 |
21,069 |
|
|
18,052 |
|
Lease liabilities |
|
10 |
4,154 |
|
|
4,104 |
|
Corporation taxation liability |
|
|
- |
|
|
159 |
|
Provision for liabilities and charges |
|
|
1,338 |
|
|
1,274 |
|
Borrowings |
|
|
4,372 |
|
|
- |
|
|
|
|
|
|
|
|
|
Current liabilities |
|
|
30,933 |
|
|
23,589 |
|
|
|
|
|
|
|
|
|
Provision for liabilities and charges |
|
|
2,160 |
|
|
2,109 |
|
Lease liabilities |
|
10 |
5,593 |
|
|
7,327 |
|
Borrowings |
|
|
- |
|
|
4,231 |
|
|
|
|
|
|
|
|
|
Non-current liabilities |
|
|
7,753 |
|
|
13,667 |
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
38,686 |
|
|
37,256 |
|
Total equity and liabilities |
|
|
66,899 |
|
|
72,503 |
Consolidated Statement of Changes in Equity for the year ended 1 January 2023
|
|
Share capital |
Share premium |
Profit and loss account |
Common control transaction reserve |
Total equity |
|
|
|
£000 |
£000 |
£000 |
£000 |
£000 |
|
|
|
|
|
|
|
|
|
|
Balance at 4 January 2021 |
1,368 |
89,495 |
5,347 |
(66,527) |
29,683 |
|
|
|
|
|
|
|
|
|
|
Total comprehensive profit for the year |
- |
- |
4,775 |
- |
4,775 |
|
|
Transactions with owners reported directly in Equity: |
|
|
|
|
|
|
|
Issue of new shares |
18 |
- |
(18) |
- |
- |
|
|
Deferred taxation asset taken to reserves |
- |
- |
4 |
- |
4 |
|
|
Current taxation asset taken to reserves |
- |
- |
98 |
- |
98 |
|
|
Equity settled share based payment transactions |
- |
- |
687 |
- |
687 |
|
|
Balance at 2 January 2022 |
1,386 |
89,495 |
10,893 |
(66,527) |
35,247 |
|
|
|
|
|
|
|
|
|
|
Total comprehensive (loss) for the year |
- |
- |
(6,511) |
- |
(6,511) |
|
|
Transactions with owners reported directly in Equity: |
|
|
|
|
|
|
|
Issue of new shares |
3 |
- |
(3) |
- |
- |
|
|
Deferred taxation asset taken to reserves |
- |
- |
10 |
- |
10 |
|
|
Dividends |
- |
- |
(555) |
- |
(555) |
|
|
Equity settled share based payment transactions |
- |
- |
22 |
- |
22 |
|
|
Balance at 1 January 2023 |
1,389 |
89,495 |
3,856 |
(66,527) |
28,213 |
|
|
|
|
|
|
|
|
|
Consolidated Statements of Cash Flows for the year ended 1 January 2023
|
|
|
|
|
|
|
|
Note |
2022 |
|
2021 |
|
|
|
£000 |
|
£000 |
|
Cash flows from operating activities |
|
|
|
|
|
(Loss) / profit for the year |
|
(6,511) |
|
4,775 |
|
Adjustments for: |
|
|
|
|
|
Depreciation of property, plant and equipment |
|
1,368 |
|
1,473 |
|
Depreciation of right-of-use assets |
10 |
3,729 |
|
3,882 |
|
Amortisation of intangible fixed assets |
|
875 |
|
842 |
|
Modification of right-of-use assets and liabilities |
10 |
(113) |
|
(83) |
|
Impairment of right-of-use assets |
10 |
27 |
|
122 |
|
Finance expense |
|
1,756 |
|
1,623 |
|
IT project impairment |
|
- |
|
14 |
|
Equity settled share based payments charge |
|
22 |
|
687 |
|
Taxation (credit) / charge |
|
(2,035) |
|
1,188 |
|
|
|
(882) |
|
14,523 |
|
Decrease / (increase) in inventories |
|
1,359 |
|
(753) |
|
(Increase) / decrease in trade and other receivables |
|
(226) |
|
783 |
|
Increase / (decrease) in trade and other payables |
|
3,017 |
|
(3,877) |
|
(Decrease) / increase in provisions |
|
(226) |
|
195 |
|
|
|
3,924 |
|
(3,652) |
|
Other interest (paid) |
|
(1,274) |
|
(1,250) |
|
Taxation (paid) |
|
(159) |
|
- |
|
Net cash inflow from operating activities |
|
1,609 |
|
9,621 |
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
Acquisition of property, plant and equipment |
|
(730) |
|
(809) |
|
Acquisition of intangible fixed assets |
|
(709) |
|
(424) |
|
Net cash (outflow) from investing activities |
|
(1,439) |
|
(1,233) |
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
Dividends paid |
|
(555) |
|
- |
|
Payment of lease liabilities |
10 |
(3,597) |
|
(3,742) |
|
Net cash (outflow) from financing activities |
|
(4,152) |
|
(3,742) |
|
|
|
|
|
|
|
Net (outflow) / inflow in cash and cash equivalents |
|
(3,982) |
|
4,646 |
|
Cash and cash equivalents at start of year |
|
16,351 |
|
11,705 |
|
|
|
|
|
|
|
Cash and cash equivalents at end of year |
|
12,369 |
|
16,351 |
2021 represents the year ended 2 January 2022.
Notes to the year end financial information
1 Statement of Compliance
Whilst the financial information included in this Preliminary Announcement has been prepared on the basis of the requirements of International Financial Reporting Standards (IFRSs) in issue, as adopted by the European Union, this announcement does not itself contain sufficient information to comply with IFRS.
The financial information set out above does not constitute the company's statutory accounts for the financial years 2022 or 2021 but is derived from those accounts. Statutory accounts for 2021 have been delivered to the registrar of companies with the Jersey Financial Statements Commission (JSFC), and those for 2022 will be delivered in due course. Grant Thornton UK LLP has reported on those accounts. Their reports for 2022 and 2021 were (i) unqualified, (ii) did not include a reference of any matters to which the auditor drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under section 113B (3) or (6) of the Companies (Jersey) Law 1991.
Safestyle UK plc is a public listed group incorporated in Jersey. The Group's shares are traded on AIM. The Group is required under AIM rule 19 to provide shareholders with audited consolidated financial statements. The registered office address of the Safestyle UK plc is 47 Esplanade, St Helier, Jersey JE1 0BD.
The Group is not required to present parent company information.
2 General information and basis of preparation
The Group's financial statements for the financial year 2022 which ended on 1 January 2023 ("financial statements"), have been prepared on a going concern basis under the historical cost convention and are in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU and the International Financial Reporting Standards Interpretations Committee interpretations issued by the International Accounting Standards Board ("IASB") that are effective or issued and early adopted as at the time of preparing these financial statements.
Safestyle UK plc was incorporated on 8 November 2013. On 3 December 2013 Safestyle UK plc acquired Style Group Holdings Limited through a share for share exchange. This was accounted for as a common control transaction. The result of this is that the financial statements of Style Group Holdings have been included in the Group consolidated financial statements of Safestyle UK plc at their book value at the IFRS transition date of 1 January 2010 with the assumption that the Group was in existence for all the periods presented. The excess of the cost at the time of acquisition over its book value has been recorded as a common control transaction reserve.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these financial statements.
The preparation of financial statements requires Management to exercise its judgement in the process of applying accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to these financial statements are disclosed in note 5.
(a) New and amended standards adopted by the Group.
The Group has adopted the following new standards and amendments for the first time. Unless otherwise stated, they have not had a material impact on the financial statements.
· Reference to the Conceptual Framework (Amendments to IFRS 3)
· Property, Plant and Equipment: Proceeds Before Intended Use (Amendments to IAS 16)
· Onerous Contracts - Cost of Fulfilling a Contract (Amendments to IAS 37)
· Annual Improvements (2018-2020 Cycle):
- Subsidiary as a First-time Adopter (Amendments to IFRS 1)
- Fees in the '10 per cent' Test for Derecognition of Liabilities (Amendments to IFRS 9)
- Lease Incentives (Amendments to IFRS 16)
- Taxation in Fair Value Measurements (Amendments to IAS 41)
(b) New standards, amendments and interpretations issued but not effective and not early adopted. At the date of approval of these financial statements, the following standards, amendments and interpretations which have not been applied in these financial statements were in issue but not yet effective (and in some cases have not yet been adopted by the EU):
· Reference to the Conceptual Framework (Amendments to IFRS 3)
· COVID-19 - Related Rent Concessions beyond 30 June 2021 (Amendments to IFRS 16)
· Property, Plant and Equipment: Proceeds Before Intended Use (Amendments to IAS 16)
· Onerous Contracts - Cost of Fulfilling a Contract (Amendments to IAS 37)
· Annual Improvements (2018-2020 Cycle):
- Subsidiary as a First-time Adopter (Amendments to IFRS 1)
- Fees in the '10 per cent' Test for Derecognition of Liabilities (Amendments to IFRS 9)
- Lease Incentives (Amendments to IFRS 16)
- Taxation in Fair Value Measurements (Amendments to IAS 41)
Basis of consolidation
Subsidiaries are entities that the Company has power over, exposure or rights to variable returns and an ability to use its power to affect those returns. In assessing control, potential voting rights that are currently exercisable or convertible are taken into account.
The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date control ceases.
Intragroup transactions and balances are eliminated on consolidation.
Year end
The financial statements are presented for the year ended on the closest Sunday to the end of December. This date was 1 January 2023 for the current reporting year and 2 January 2022 for the prior year. All references made throughout these accounts for the financial year 2022 are for the period 3 January 2022 to 1 January 2023 and references to the financial year 2021 are for the period 4 January 2021 to 2 January 2022.
3 Going concern
The financial statements are prepared on a going concern basis which the Directors believe to be appropriate for the following reasons.
The Group made a statutory loss of £(6.5)m in the financial year 2022 (2021: profit of £4.8m) and had net current liabilities of £(9.4)m at the end of the financial year 2022 (2021: net current assets of £2.9m). As detailed in the Financial Review, the loss reported of £(6.5)m was a result of the Group experiencing several unforeseen challenges with a cyber-attack, record high summer temperatures causing disruption to customer fulfilment, and political instability in the UK causing trading turbulence in the latter part of the year. Demand improved into November which resulted in a stronger closing order book than expected which will support revenues in 2023. However, the investment of growing the order book was incurred in 2022 and will be realised in 2023 when the orders are installed. In addition, the Group invested c.£5m over 2022 in its strategic priorities as it focusses on its medium-term objectives. Net cash ended the year at £8.0m (2021: £12.1m), with the reduction in line with the trading performance for the year.
At the year end, the Group had banking facilities which consist of a £4.5m term loan and a £3.0m revolving credit facility ("RCF"). The RCF remained undrawn throughout 2022, which has been the case since May 2020, and following a revision to the banking covenants in place there were no covenant tests applicable at year end as the RCF was undrawn. The Group replaced its existing borrowing facility in January 2023 with a new RCF of £7.5m extending out to December 2026. The agreement is covenant-lite, whereby there are no covenant tests in place whilst the facility is undrawn.
In addition, the Group's net cash position was £4.4m at 26 February 2023 (February 2022: net cash of £14.5m).
The Directors have prepared forecasts covering the period to the end of 2024, to cover an assessment period until June 2024. The forecasts include a number of assumptions in relation to sales volume, pricing, margin improvements and overhead investment. The Directors believe the key assumptions to be a cautious reflection of the economy and realistic with installation volume 4.6% below FY22 levels which was impacted by the cyber attack. This target is deemed to be realistic. The Group has a strong opening order book following increased demand in November 2022 and order intake at this level would match the current capacity of the installation network. The Group is forecasting the continuation of significant increases in manufacturing costs as suppliers pass on increasing energy and raw material prices that they are incurring themselves. Increases in overhead costs have also been forecast as the Group continues its strategic agenda to invest in IT, customer services, as well as annual pay increases in line with rising inflation. These forecasts result in further increases in net cash and liquidity, with no covenant tests in place in line with the new facility, as the RCF is forecast to remain undrawn throughout the year.
Whilst the Directors believe the assumptions above to be sensible, the operating environment is exposed to a number of risks which could impact the actual performance achieved in 2023. These risks include, but are not limited to, reducing consumer confidence due to the general economic conditions, (delivering the required levels of order intake in the current economic environment), competition from other sectors increases, and the Group's ability to maintain margins given the rising input costs.
The Directors have modelled various sensitised downside scenarios for 2023 and 2024. For 2023, these included a scenario which modelled an 8% reduction in installation volumes versus 2022 and installation volumes at similar levels to the COVID impacted year of 2020. In this scenario, mitigating actions within the control of management, including reductions in areas of discretionary spend could be deployed. Even with the above significant reductions in activity, the resultant cash flow forecasts, after mitigation that are entirely within management's control. Projections show that the Group will be able to increase its net cash position and operate within the financial covenants of the borrowing facility.
In forming their view on preparing the financial statements on a going concern basis, the Board notes that considerable headroom exists between sales required in its forecast scenario and those required to maintain positive net cash and available liquidity. The Board considers that the reverse stress test scenario which would result in a covenant breach represents a highly unlikely downside trading performance scenario.
The Board of Directors therefore conclude that, in its opinion, the Group has sufficient working capital for its present requirements until the end of the going concern period, with downside scenarios consistent with levels achieved in the year where the business shutdown operations for 2 months in the height of the COVID pandemic.
Based on the above indications and work prepared, the Board of Directors believes that it is appropriate to prepare the financial statements on a going concern basis.
4 Significant accounting policies
Revenue recognition
The Group earns revenue from the design, manufacture, delivery and installation of domestic double-glazed replacement windows and doors.
There are five main steps followed for revenue recognition:
· Identifying the contract with a customer
· Identifying the performance obligations
· Determining the transaction price
· Allocating the transaction price to the performance obligations; and
· Recognising revenue when or as an entity satisfied performance obligations.
The various stages of the performance obligations are the design, manufacture, delivery and installation of domestic double-glazed replacement windows and doors.
In applying the principal of recognising revenue related to satisfaction of performance obligations under IFRS 15, the Group considers that the final end product is dependent upon a number of services in the process that may be capable of distinct identifiable performance obligations. However, where obligations are not separately identifiable, in terms of a customer being unable to enjoy the benefit in isolation, the standard allows for these to be combined. The Group considers that in the context of the contracts held these are not distinct. As such, the performance obligations are treated as one combined performance obligation and revenue is recognised in full, at a point in time, being on completion of the installation. Revenue is shown net of discounts, sales returns, charges for the provision of consumer credit, VAT and other sales related taxes. Revenue is measured based on the consideration specified in a contract with a customer.
There is no identifiable amount included in the final price for a warranty, as the Group provides a guarantee on all installations.
Payments received in advance are held within other creditors, as a contract liability. The final payment is due on installation.
A survey fee is paid at the point of agreeing the contract and the customer has up to 14 days, defined in the contract, to change their minds. If the customer changes their mind after this cooling off period, the Group has the right to retain this survey fee and as such revenue for this is recognised at the point in time that this becomes non-refundable.
The Group offers consumer finance products from a range of providers whilst acting as a credit broker and not the lender. The Group earns commission and pays subsidies for its role as a credit broker. As the Group is acting as the agent and not the principal, commission is not disclosed as a separate income stream.
In addition to the above, the Group recognises revenue from the sale of materials for recycling. The revenue is recognised when the materials are collected by the recycling company which represents the completion of the performance obligation. The Group has determined that this revenue is derived from its ordinary activities and as such this balance is recognised within revenue.
Non-underlying items
Non-underlying items consist of non-recurring costs, share based payments and Commercial Agreement amortisation. Non-recurring costs are excluded because they are not expected to repeat in future years.
5 Accounting estimates and judgements
When preparing the Group's consolidated financial statements, management makes a number of judgements, estimates and assumptions about the recognition and measurement of assets, liabilities, revenue and expenses. Actual results can differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.
Significant management judgements
The following are the judgements made by management in applying the accounting policies of the Group that have the most significant effect on these consolidated financial statements.
Recognition of deferred taxation assets
The extent to which deferred taxation assets can be recognised is based on an assessment of the probability that future taxable income will be available against which the deductible temporary differences and taxation loss carry-forwards can be utilised. The deferred taxation asset of £2,984k (2021: £1,053k) has been recognised on the basis that the Group is forecasting to make sufficient levels of profits in future periods.
Estimation uncertainty
Impairment of goodwill
In assessing impairment, management estimates the recoverable amount of each asset or cash generating unit based on expected future cash flows and uses an appropriate rate to discount them. Estimation uncertainty relates to assumptions about future operating results and the determination of a suitable discount rate. A pre-taxation discount rate of 16% has been applied to the impairment assessment calculation. This was calculated using publicly available third party data sources. Management used judgement in the decision to use a discount factor of 16%.
Dilapidations provision
The Group has a portfolio of leased properties that sales branches and installation depots operate from. A dilapidations provision is provided for leased properties where the lease agreement contains a contractual obligation to undertake remedial works at the end of the lease term and where wear-and-tear, or damage on the property, has occurred. The calculation of the estimate is based on historical experience of cost to rectify upon exiting similar properties. The estimated costs are subject to estimation uncertainty as the final payment agreed may differ to the estimated cost given the process whereby dilapidations are negotiated. If the effect of discounting is material, the dilapidations provision is determined by calculating the expected future cash flows at a pre-taxation rate that reflects current market assessments of the time value of money, and when appropriate, the risks specific to the liability.
Product guarantee provision
The Group guarantees all of its products, which in the majority of cases covers a period of 10 years. The provision is calculated to cover the cost of fulfilling any guarantee work to its customers, and is based on the expected future costs of rectifying faults and the future rate of product failure arising within the guarantee period. The level of provision required to cover this cost is subject to estimation uncertainty. If the effect of discounting is material, the guarantee provision is determined by calculating the expected future cash flows at a pre-taxation rate that reflects current market assessments of the time value of money, and, when appropriate, the risks specific to the liability.
Expected credit loss for trade receivables
The Group assesses, on a forward-looking basis, the expected credit losses ('ECLs') associated with its trade receivables. This is based on historical experience, external indicators and forward-looking information to calculate the expected credit losses.
6 Non-recurring costs
|
|
|
2022 |
2021 |
|
|
|
£000 |
£000 |
|
|
|
|
|
|
Holiday pay accrual |
a |
(46) |
(79) |
|
RSA related costs |
b |
- |
147 |
|
Litigation Costs |
c |
131 |
90 |
|
Restructuring and operational costs |
d |
473 |
300 |
|
Modification of right-of-use assets and liabilities |
e |
(113) |
(83) |
|
Impairment of right-of-use assets |
f |
27 |
122 |
|
IT project impairment |
g |
- |
14 |
|
Cyber incident related costs |
h |
953 |
- |
|
Operational project costs |
i |
1,663 |
- |
|
Previous CEO retirement costs |
j |
556 |
- |
|
|
|
|
|
|
Total non-recurring costs |
|
3,644 |
511 |
|
a) The holiday pay accrual arose as a result of the impact of the shutdown of operations and resultant extension of 2020 leave entitlement which, for some employees, is up to March 2023. The release of the current reporting period represents a partial-unwinding of the original accrual booked in 2020 due to the deferred holiday subsequently taken in the year.
|
|
b) RSA related costs are the employer related taxes associated with the issue of Restricted Share Award Scheme during the year.
c) Litigation costs are mainly expenses incurred as a result of a legal dispute between the Group and an ex‐agent. These costs are predominantly legal advisor's fees.
|
|
d) Restructuring and operational costs are expenses incurred, including redundancy payments, as a result of changes being made to reduce the cost structure of the business.
e) Modification of right‐of‐use assets relates to the closure of properties identified as right‐of‐use assets during the period.
|
|
f) Impairment of right-of-use asset costs relates to the closure of properties identified as assets under IFRS 16 where the lease commitment extended beyond 2022.
g) IT project impairment charge represented the impairment of a capital investment made in a new electronic survey system that was stopped following results of field trials.
h) Cyber incident related costs directly incurred and associated with the cyber-attack that took place in January 2022. Immediately following the attack, there was a short-term impact on the Group's operations as it implemented business continuity workarounds as it recovered its systems.
|
|
i) Operational project costs are the incremental costs of transitioning to the Group's new profile supplier and the costs of impairing the remaining stock held of that was specific to the old profile and that will no longer be sold to customers.
|
|
j) Previous CEO retirement costs represent the costs of treatment of Mike Gallacher's remuneration arrangements following his retirement. |
7 Earnings per Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per ordinary share (pence) |
|
|
|
|
|
(4.7) |
3.5 |
|
|
|
|
Diluted earnings per ordinary share (pence)* |
|
|
|
|
|
(4.7) |
3.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a) Basic earnings per share |
|
|
|
|
|
|
|
|
|
|
|
The calculation of basic earnings per share has been based on the following (loss) / profit attributable to ordinary shareholders and weighted-average number of shares outstanding. |
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
i) (Loss) / profit attributable to ordinary shareholders (basic) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
2021 |
|
|
|
|
|
|
|
|
|
|
000 |
000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) / profit attributable to ordinary shareholders |
|
|
|
|
|
(6,511) |
4,775 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ii) Weighted-average number of ordinary shares (basic) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
No of shares |
No of shares |
|
|
|
|
|
|
|
|
|
|
'000 |
'000 |
|
|
|
|
In issue during the year |
|
|
|
|
|
138,748 |
137,753 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
b) Diluted earnings per share |
|
|
|
|
|
|
|
|||
|
*Due to a net loss for the year, diluted earnings per share is the same as basic for 2022.
The calculation of diluted earnings per share has been based on the following (loss) / profit attributable to ordinary shareholders and weighted-average number of ordinary shares outstanding after adjustment for the effects of all dilutive potential ordinary shares. |
|
|
||||||||
|
|
|
|||||||||
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
2021 |
|
|
|
|
|
|
|
|
|
|
£000 |
£000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
i) (Loss) / profit attributable to ordinary shareholders (diluted) |
|
|
|
|
|
(6,511) |
4,775 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ii) Weighted-average number of ordinary shares (diluted) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
No of shares |
No of shares |
|
|
|
|
|
|
|
|
|
|
'000 |
'000 |
|
|
|
|
Weighted-average number of ordinary shares (basic) |
|
|
|
|
|
138,748 |
137,753 |
|
|
|
|
Effect of conversion of share options |
|
|
|
|
|
- |
3,589 |
|
|
|
|
|
|
|
|
|
|
138,748 |
141,342 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The average market value of the Group's shares for the purpose of calculating the dilutive effect of share options was based on quoted market prices for the period during which the options were outstanding.
Diluted earnings per share is calculated by adjusting the earnings and number of shares for the effects of dilutive options. In the event that a loss is recorded for the year, share options are not considered to have a dilutive effect. |
|
|
||||||||
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
8 Inventory
|
|
|
|
2022 |
2021 |
|
|
|
|
000 |
000 |
|
|
|
|
|
|
|
Raw materials and consumables |
|
|
3,017 |
4,329 |
|
Work in progress |
|
|
79 |
80 |
|
Finished goods |
|
|
843 |
889 |
|
|
|
|
3,939 |
5,298 |
9 Trade and other payables
|
|
|
|
|
|
2022 |
2021 |
|
|
|
|
|
|
000 |
000 |
|
|
|
|
|
|
|
|
|
Trade payables |
|
|
|
|
8,512 |
7,118 |
|
Other taxation and social security costs |
|
|
|
|
3,649 |
3,169 |
|
Other creditors and deferred income |
|
|
|
|
4,298 |
4,747 |
|
Accruals |
|
|
|
|
4,610 |
3,018 |
|
|
|
|
|
|
21,069 |
18,052 |
10 Right of use assets and liabilities
|
|
|
Properties |
Motor Vehicles |
Equipment |
Total |
|
|
|
£000 |
£000 |
£000 |
£000 |
|
|
Assets |
|
|
|
|
|
|
At 2 January 2022 |
5,177 |
5,686 |
283 |
11,146 |
|
|
Additions |
1,591 |
814 |
22 |
2,427 |
|
|
Impairment |
(27) |
- |
- |
(27) |
|
|
Modification |
(355) |
(46) |
- |
(401) |
|
|
Depreciation |
(1,310) |
(2,329) |
(90) |
(3,729) |
|
|
At 1 January 2023 |
5,076 |
4,125 |
215 |
9,416 |
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
At 2 January 2022 |
5,372 |
5,765 |
294 |
11,431 |
|
|
Payment |
(1,585) |
(2,596) |
(104) |
(4,285) |
|
|
Additions |
1,591 |
814 |
22 |
2,427 |
|
|
Interest |
353 |
326 |
9 |
688 |
|
|
Modification |
(469) |
(45) |
- |
(514) |
|
|
At 1 January 2023 |
5,262 |
4,264 |
221 |
9,747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of movements of liabilities to cash flows arising from financial activities |
|
|||
|
|
|
|
|
|
|
|
|
Balance at 2 January 2022 |
5,372 |
5,765 |
294 |
11,431 |
|
|
Payment of lease liabilities |
(1,232) |
(2,270) |
(95) |
(3,597) |
|
|
Total changes from financing cash flows |
(1,232) |
(2,270) |
(95) |
(3,597) |
|
|
|
|
|
|
|
|
|
Other changes |
|
|
|
|
|
|
New leases |
1,591 |
814 |
22 |
2,427 |
|
|
Impairment |
(469) |
(45) |
- |
(514) |
|
|
Interest expense |
353 |
326 |
9 |
688 |
|
|
Interest paid |
(353) |
(326) |
(9) |
(688) |
|
|
Total liability-related other changes |
1,122 |
769 |
22 |
1,913 |
|
|
|
|
|
|
|
|
|
At 1 January 2023 |
5,262 |
4,264 |
221 |
9,747 |
|
|
Liabilities classification |
|
|
|
|
|
|
Current (<1 year) |
1,586 |
2,489 |
79 |
4,154 |
|
|
Long term (>1 year) |
3,676 |
1,775 |
142 |
5,593 |
|
|
5,262 |
4,264 |
221 |
9,747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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