Financial results for the year ended 30 June 2024

Wilmington PLC

16 September 2024

 

16 September 2024

Wilmington plc

Sustained double digit profits growth

Wilmington plc, (LSE: WIL, 'Wilmington' or 'the Group') the provider of data, information, education and training services in the global Governance, Risk and Compliance (GRC) markets, today announces its unaudited preliminary results for the year ended 30 June 2024. The results are unaudited because the auditors have requested extra time to complete their final audit procedures.

Financial performance

	2024	2023	Change
Ongoing results[1]
Revenue	£89.7m	£78.7m	14%
Adjusted PBT[2]	£24.1m	£16.9m	42%
Adjusted PBT margin	26.8%	21.5%	25%
Adjusted basic EPS[3]	19.81p	14.02p	41%
Total results
Net cash[4]	£67.8m	£42.2m	61%
Total dividend	11.3p	10.0p	13%
Total adjusted PBT	£27.6m	£24.3m	13%
Total adjusted PBT margin	22%	20%	11%
Total basic EPS	46.32p	22.94p	102%

Statutory continuing results
Revenue	£98.3m	£93.1m	6%
PBT	£24.2m	£20.5m	17%
Basic EPS	19.33p	19.51p	(1%)

Highlights

·      14% revenue growth from ongoing businesses. Organic growth of 9%¹. All ongoing businesses grew.

·      Annual recurring revenues up 16%, now 36% (2023: 33%) of Group organic revenues, despite the sale of subscription-heavy businesses.

·      Adjusted profit before tax from ongoing businesses up 42% to £24.1m (2023: £16.9m). Total adjusted profit before tax of £27.6m (2023: £24.3m).

·      Total adjusted PBT margin up to 22% from 20%. Operating margins of ongoing businesses continue to increase.

·      Dividend increased by 13% to final dividend of 11.3p.

·      Robust balance sheet with net cash at 30 June 2024 £67.8m (2023: £42.2m) reflecting strong trading performance and cash conversion as well as the net cash received from portfolio changes.

·      Continued to enhance and streamline portfolio with acquisition of Astutis, and disposals of European Healthcare & MiExact businesses.

·      Investment in the development of single technology platform for the whole business.

Mark Milner, Chief Executive Officer, commented:

"We have delivered another strong year, in line with our strategy with notably strong increases in revenues, profits and cash generation. Margins have also continued to improve strongly. 

"We continued to focus on consolidating our already strong presence in the large, growing and rapidly evolving international GRC markets and significantly enhanced our capabilities with the acquisition of Astutis in the Health, Safety and Environment (HSE) sector. We sold our European Healthcare businesses and MiExact.

"We now have a higher quality portfolio of growing international businesses and continue to pursue various opportunities to invest in acquisitions to improve our growth and profitability. We have also started to transfer our businesses onto our single operating platform, which will continue to improve our performance.

"We have had a good start to the current financial year, with revenues and profits in line with expectations."

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement this inside information is now considered to be in the public domain.

For further information, please contact: Wilmington plc   Mark Milner, Chief Executive Officer Guy Millward, Chief Financial Officer Meare Consulting Adrian Duffield

020 7490 0049 07990 858548

Notes to Editors

Wilmington plc is the recognised knowledge leader and partner of choice for data, information, education and training in the global Governance, Risk and Compliance (GRC) markets. Wilmington employs over 600 people and sells to around 120 countries. Wilmington is listed on the main market of the London Stock Exchange.

CEO's review

Overview

We are pleased to report another year of good progress and delivering on our strategy with notably strong increases in revenues, profits and cash generation. We continued to focus our portfolio of businesses on the international Governance, Risk and Compliance (GRC) markets and significantly enhanced our capabilities with the acquisition of Astutis in the Health, Safety and Environment (HSE) sector. We sold our European Healthcare businesses and MiExact.

We also continued to invest in our operational growth levers, sales, marketing, product development and have moved decisively towards running all our operations on a single platform, by merging the previous platforms built for training and data operations. During the year, following the disposal of the businesses that made up the majority of our Intelligence division, we have reorganised our segmental reporting around the external markets addressed by our brands from Training & Education and Intelligence to HSE, Legal and Financial Services.

Results

For the year ending 30 June 2024, the Group saw overall organic revenue growth of 9%, with solid growth from all our ongoing businesses. We also achieved 16% growth in Group recurring revenues, making up 36% of total revenues (2023: 33%). We have achieved organic revenue growth every year in the last four financial years.

The increased revenues and a continued focus on operational efficiency resulted in total adjusted PBT growth of 13% to £27.6m (2023: £24.3m) and a corresponding improvement in adjusted PBT margin to 22% (2023: 20%). We have also achieved this profit growth over the last four years, despite selling or closing seven of the 15 businesses in the Group in 2020.

Profits from underlying operations (excluding the Astutis acquisition) were up 35%, driven by strong trading in our Financial Services businesses and net interest income on our cash of £2.0m. This resulted in underlying adjusted basic earnings per share being up 33%, which in turn has allowed us to propose an increase in dividend to a final dividend of 8.3p (total of 11.3p).

Statutory revenue was up 6% to £98.3m (2023: £93.1m). Statutory PBT was up 17% to £24.2m (2023: £20.5m). Total Basic EPS increased to 46.32p (2023: 22.94p).

The Group again strengthened its balance sheet, increasing its net cash position (excluding lease liabilities & including cash held for sale) to £67.8m (2023: £42.2m) after another strong year of converting profits to cash as well as the net cash received from portfolio changes. We have also significantly reduced our future lease liabilities by downsizing office footprints, including exiting our London offices. This will provide significant cost savings going forward and better complement our hybrid working policy, which has resulted in a need for far less office space.

Strategy

Our strategy is delivering, so there is no change here. We continued to focus on consolidating our already strong presence in the large, growing and rapidly evolving international GRC markets. These markets are underpinned by strong macro drivers, particularly the increasing volume and enforcement of regulation, complex geopolitical landscape, increased importance of ESG and widespread adoption of technological and data-driven compliance solutions, all of which align strongly to Wilmington's core offering.

At the heart of this focus on the GRC markets is our ambition to help our customers to do the right business in the right way, by providing a complementary range of information & data and training & education solutions. Our businesses focus on the financial services, legal and HSE markets. We are looking to acquire further businesses in these and complementary sectors.

Portfolio update

In November 2023, we completed the acquisition of Astutis, a training business offering a range of globally recognised and regulated health, safety and environmental qualifications, based in Cardiff. The business has achieved strong growth in the growing HSE market and is highly complementary to our existing portfolio. The acquisition of Astutis is consistent with our strategy in the GRC market to broaden and strengthen our training and education capabilities.

We continue to review all parts of the Group assessing businesses against six key characteristics: organic growth opportunities; attractive markets; digital and data capabilities; strong leadership; strategic fit to the GRC marketplaces; and attractive product, revenue, and profitability characteristics. 

As part of this ongoing review, we determined that our Healthcare, Compliance Week and MiExact businesses no longer met our criteria. MiExact, a UK mortality data business, and the European Healthcare business were sold during the year, Compliance Week is in a sale process. We also closed our operations in Singapore and Malaysia due to continuing declining revenues, ongoing losses and little prospect of recovery given the local market conditions. We now serve the Singapore and Malaysia markets from the UK.

We continue to seek businesses to join the Group, with a highly active but disciplined M&A function exploring many options. To date, we have identified numerous businesses which meet our required characteristics. However, valuation expectations continue to remain high and we continue to take a very disciplined approach. Our priority is to allocate the capital available to us, including our cash balance, cash we generate from our profitable operations, and our borrowing capability, to acquisitions in the next two years.

Investment

Our investment approach across the Group continues to be targeted at embedding the unique characteristics that define our competitive advantage into each of our brands. We are pleased with the progress we have made in developing a single technology platform for our businesses, by merging our previous platform investments and removing more of our legacy technology debt. We have more work to do to achieve a single platform for everything we do but the building blocks are in place and should deliver operational efficiencies in FY25 as expected. The implementation of a single platform will also allow us to efficiently expand our offering by creating a scalable portfolio to enhance our growth potential.

We continue to invest organically in new products and strengthen our existing product offerings, with the scope to monetise our solutions greatly enhanced by our single platform approach. This strategy for maximising the value of our technology and data assets, combined with our streamlined operating model, provides the strong base to actively consider acquisition targets which complement and/or extend our capabilities.

We reported last year that within the strategic framework of Wilmington, deliberate measures are being put into action to navigate the risks that accompany AI technology while simultaneously harnessing its opportunities. Work continues to mitigate risks and incorporate AI into our products.

We also remain focused on investing in the many drivers of employee engagement, which increased year on year as measured by our annual engagement survey. Development is actioned by activities such as regular Town Halls, the building and support of communities, and development of Working Groups to focus on keys areas such as diversity and inclusion, reward strategies, talent development and others.

Responsible business

We are committed to investing in the initiatives that support our colleagues and our own responsible business culture.

We continue to make significant progress with our People Strategy. Our people make our business, and our continued success in this financial year is down to their hard work, ingenuity, skills and expertise, and I thank everyone for their commitment to Wilmington.

We have achieved progress against our targets in all four areas of our sustainability strategy, and this work continues to underpin our broader strategic objectives and risk management processes. Full details of this work can be found in our Sustainability report.

We implemented the Taskforce for Climate-related Financial Disclosures (TCFD) recommendations in full two years ago, while still putting together some further detail on the metric requirements. We concluded that we must continue to monitor the impacts of climate change on the Group's risk profile, but that the potential opportunities that may arise from the transition to a low-carbon economy are well aligned to our core offering. We have committed to net-zero carbon targets, with an ambition of absolute zero, producing no greenhouse gas emissions, in respect of Scope 1 and 2 emissions by 2028, and net zero in respect of Scope 3 emissions by 2045.

Review of operations

	2024	2023	Absolute variance	Organic variance[5]
	£'m	£'m	%	%
Revenue
HSE[6]	4.8
Legal[7]	16.0	14.0	14%	14%
Insurance	28.8	27.8	3%	6%
Other	40.1	36.9	9%	9%
Financial Services[8]	68.9	64.7	6%	7%
Ongoing revenue	89.7	78.7	14%	9%
Ongoing operating profit	28.1	21.9	28%	24%
Margin %	31%	28%
Total revenue[9]	126.0	123.5	2%
Total operating profit	31.6	29.3	8%

Group performance

Revenues from ongoing businesses grew 14%, 9% excluding currency gains and the Astutis acquisition. All eight of the ongoing businesses grew organically and recurring subscription revenues grew 16%.

Astutis features for the first time so has no variances on last year, and the numbers are for a partial year. The business grew significantly on its prior year performance.

Group operating profits improved by 24% organically and operating margins for ongoing businesses increased to 31% on the back of the revenue increases and continued cost improvements.

Segmental reporting

Following the acquisition of Astutis, a training business in the HSE sector and the disposal of the European Healthcare and MiExact businesses and the decision to sell Compliance Week, which together made up the majority of what was previously our Intelligence Division, we have reorganised our segmental reporting around the external markets addressed by our brands. 

HSE

The HSE segment comprises Astutis, acquired in November 2023. Astutis is a UK training business which mixes face-to-face and online learning for various industry standard qualifications and certificates in the HSE sector. The business has experienced strong growth in recent years after switching focus to more online training post-Covid and has a strong market position in a growing marketplace.

Legal

The Legal segment comprises Bond Solon and Pendragon, whose customers are predominantly in the legal market. Bond Solon is mainly UK based and trains individuals involved in the legal system, including lawyers, helping them train their clients for interaction with the legal system. Revenue is earned through one off course attendance fees. Courses are typically single or half day events, and content is a mix of owned and third-party intellectual property. Courses are delivered either by in-house experts or a network of independent tutors who are paid per course. The Law for Non-Lawyers market is strong, with good ongoing demand for existing products as well as successful launches of new training courses.

Pendragon operates in the UK pensions market, providing information products and services with revenues generated primarily through subscription.

Legal revenues grew 14% organically, led by Bond Solon which had a significant contract win in the public sector to give it a second consecutive year of double-digit revenue growth. Pendragon had a strong year for subscription revenue growth and again achieved very strong customer retention (99%).

Financial Services

Financial Services Insurance comprises Axco and FRA. Axco provides a broad range of information products and services with revenues generated primarily through subscription, and customers are spread globally.

FRA is predominantly events based. It serves the US Healthcare and Health Insurance markets and, to a lesser extent, the US financial and legal service communities. The prime brand is the RISE series of events that addresses the Medicare and Medicaid markets and is attended by health plans, physician groups and solution partners. The flagship event is RISE National which normally takes place in March each year. Revenue from the US events is generated from both sponsorship and delegate sales.

Financial Services Insurance revenues grew 6% overall. Axco grew revenues by 7%, excluding currency gains, and had a strong year for subscription revenue growth. Recurring revenue retention rates were at 99%. FRA revenues were flat in sterling terms but grew 4% in US dollars, delegate revenues were again strong.

Financial Services Other comprises three businesses that operate in Compliance markets. The largest business, which was developed organically within Wilmington, is the International Compliance Association ('ICA'). It is an industry body and training business that was created in 2002. It offers professional development and support to compliance officers predominantly in the financial services sector. It has offices in the UK and Dubai, and a presence in India.

The material for ICA courses is developed by our own internal R&D team, and external specialists. We own the associated intellectual property. Revenue earned by ICA is primarily training income complemented by subscriptions paid by the professional members for their ICA accreditations. The courses ICA run usually extend over several weeks or even months. They traditionally mix distance learning with face-to-face sessions. The distance learning element has transitioned to online and digital variants, and virtual programmes have been offered in place of face-to-face sessions.

The second business, CLTi, earns revenue from running professional development programmes for wealth managers, in association with The Society of Trust and Estate Practitioners. Wilmington has an international presence, with customers in the UK, Europe, Asia Pacific and the US. Our consistent investment programme in content and technology is maintaining our competitive positioning.

The third business, Mercia, provides training for accountants in practice and in business. It runs a mix of face-to-face, online, and blended learning for this community. It provides training at various levels including providing continuing professional development for existing qualified accountants. Additionally, it provides technical support to accountancy firms which enables them to keep abreast of technical developments and changes to regulation, as well as supporting them to promote the services they then offer to their clients. 

Mercia is predominantly UK and Ireland based reflecting the country specific laws and accounting standards that govern the profession. Revenue in the unit is earned through clients subscribing for ongoing training, support and other related activities over a period of time (usually 12 months), with the rest through one off course attendance fees. Courses are typically single or half day events, and content is a mix of owned and third-party intellectual property. Courses are delivered either by in-house experts or a network of independent tutors who are paid per course that they deliver.

Financial Services Other, overall revenues grew 9%. CLTi and ICA UK and Middle East revenues were up by double digit percentage points. ICA saw continued revenue decline in Singapore and Malaysia and the business there became loss-making. Without any sign of a return to profit or revenue growth in the near future we took the decision to close our operations in Singapore and Malaysia and to service the area from the UK. Mercia revenues grew 4% in the year and significantly improved its recurring revenues.

Financial review

Overview

The Group performance was again strong during the year, driving organic growth in revenue and profit and improving the balance sheet, reflected by the increased closing net cash position and the reduced lease liabilities. We also sold our Healthcare and MiExact businesses and acquired Astutis, all of which have a significant effect on our balance sheet and trading.

Adjusting items, measures, and adjusted results

In this financial review reference is made to adjusted results as well as the equivalent statutory measures. The Directors make use of adjusted results, which are not considered to be a substitute for, or superior to, IFRS measures, to provide stakeholders with additional relevant information and enable an alternative comparison of performance over time. Adjusted results exclude amortisation of intangible assets (excluding computer software), impairments, other income (when material or of a significant nature) and other adjusting items.

	2024	2023	Absolute variance		Organic variance
	£'m	£'m	£'m	%	%
Statutory continuing revenue	98.3	93.1	5.2	6%	7%
Continuing Adjusted profit before tax	23.7	19.5	4.2	21%
Continuing Adjusted profit margin %	24%	20%

Variances described as 'organic' are calculated by adjusting the revenue change achieved year-on-year to exclude the impact of changes in foreign currency exchange rates and also to exclude the impact of changes in the portfolio from acquisitions and disposals.

Revenue

Group revenue increased 6% on a statutory continuing basis and 9% on an organic basis, the statutory continuing increase reflecting £0.9m of foreign currency downside and the impact of disposals carried out part way through the year. Full details can be found in the review of operations.

Operating expenses before amortisation of intangible assets (excluding computer software), impairment and adjusting items

Operating expenses before amortisation of intangible assets (excluding computer software) and impairments increased to £76.6m (2023: £73.8m).

Within operating expenses, staff costs were £43.6m (2023: £44.4m). This net decrease reflects the reduced salary cost as a result of the decrease in headcount post disposals which was partly offset by inflationary pay rises. Share based payment costs increased £0.4m due to a full year of charge relating to the 2023 SAYE scheme and the introduction of the 2024 SAYE scheme, which commenced in the year.

Non-staff costs increased by £3.6m to £33.0m (2023: £29.4m), reflecting the current year costs of Astutis from November and general inflationary increases.  

Unallocated central overheads

Unallocated central overheads, representing Board costs and head office salaries, as well as other centrally incurred costs were £4.2m (2023: £3.7m).  

Adjusted profit before tax ('adjusted PBT')

As a result of increased revenue and a continued focus on operational efficiency, adjusted profit before tax, which eliminates the impact of amortisation of intangible assets (excluding computer software), impairments, other income and other adjusting items, was up 21% to £23.7m (2023: £19.5m). Adjusted profit margin (adjusted PBT expressed as a percentage of revenue) also increased to 24% (2023: 20%).

Total Group adjusted profit before tax was up 13% to £27.6m (2023: £24.3m) and on a total basis the adjusted profit margin increased to 22% (2023: 20%).

Amortisation excluding computer software, impairment, adjusting charge and other income

Amortisation of intangible assets (excluding computer software) was £2.1m (2023: £1.1m) representing amortisation from acquired intangibles. The increase year on year largely reflects the acquisition of Astutis made during the year.

The non-cash impairment of £4.4m (2023: £nil) represents the impairment of goodwill in Compliance Week. The adjusting charge of £0.6m (2023: £0.1m) represents strategic costs for acquisitions.

Gain on disposals represents a total net gain of £26.8m consisting of £5.5m included within other income largely relating to MiExact, and £21.3m gain disposal of European Healthcare included within profit from discontinued operations, see note 11 for further details. Other income also includes £2.2m representing a gain on the sale of a building and the early exit of the head office lease leading to a lease modification, see note 5a for further details.

Operating profit

Operating profit was £22.2m (2023: £20.3m), driven largely by the £5.5m gain on disposal of subsidiaries (2023: £2.2m), the gain on disposal of property, plant and equipment and lease modification of £2.2m, partially offset by £4.4m of goodwill impairment.

Net finance income

Net finance income up £1.8m to £2.0m (2023: £0.2m), primarily related to the interest received on the significant cash balance the Group maintained during the year.

Profit before taxation

Profit before taxation was £24.2m (2023: £20.5m); a reconciliation of profit before tax to adjusted profit before tax can be found in note 3.

Taxation

The tax charge for the year was £7.0m (2023: £3.3m) reflecting an effective tax rate of 29.4% (2023: 16.2%). The increase in the tax rate year-on-year reflects an increase in the full year of UK corporation tax at 25%, offset by the nature of other operating income with business disposals qualifying for the SSE.

The underlying tax rate which ignores the tax effects of adjusting items increased to 27.2% (2023: 25.2%). The increase reflects the full year of the UK corporation tax increase from 19% to 25%, with only one quarter being applied to FY23.

Earnings per share

Adjusted basic earnings per share increased by 17% to 19.38p (2023: 16.57p) see note 9, due to the increase in adjusted profit before tax, offset by an increase in the corporation tax rate causing an increase in the underlying tax rate. The number of issued ordinary shares was essentially unchanged. Total Basic earnings per share was 46.32p (2023: 22.94p) reflecting the increase in profit after tax, see note 9.

Ongoing adjusted basic earnings per share, excluding the results of sold and closed businesses, increased by 41% to 19.81p (2023: 14.02p), see reconciliation below.

	2024 £'m	2023 £'m
Adjusted earnings (note 9)	20.4	18.9
Remove profit after tax of sold and closed businesses	(2.8)	(6.6)
Ongoing adjusted earnings	17.6	12.3
	2024 Number	2023 Number	Variance
Weighted average number of ordinary shares (note 9)	88,964,817	88,027,119
Ongoing adjusted basic earnings per share	19.81p	14.02p	41%

Dividend

A final dividend of 8.3p per share (2023: 7.3p) will be proposed at the AGM. This will give a full year dividend up 13% to 11.3p (2023: 10.0p) and dividend cover of 2.0 times (2023: 2.1 times).

If approved it will be paid on 4 December 2024 to shareholders on the register as at 1 November 2024 with an associated ex-dividend date of 31 October 2024.

Balance sheet

Non-current assets

Goodwill at 30 June 2024 was £52.8m (2023: £60.6m). The decrease is due to disposals of £14.3m and impairment in the Compliance Week CGU of £4.4m, following the decision to sell it, with the remaining goodwill in Compliance Week of £0.4m transferred to held for sale, partly offset by the goodwill arisen from the acquisition of Astutis of £11.2m.

Intangible assets increased by £4.5m to £10.2m (2023: £5.7m) due to the acquisition of Astutis of £9.9m and additions of £0.2m within computer software; partly offset by amortisation of £3.7m, and £1.8m of disposals largely relating to the disposal of subsidiaries. The remaining £0.1m variance reflects exchange translation differences. 

Property, plant and equipment decreased by £3.9m to £3.1m (2023: £7.0m). This is attributable to the £1.5m decrease from disposals largely relating to the disposal of subsidiaries, £0.8m decrease due to the lease modification, depreciation of £1.8m and an impairment of the assets associated with the head office of £0.4m. Partly offset by additions of £0.1m and £0.4m recognised from the acquisition of Astutis. The remaining £0.1m reflects exchange translation differences.

Deferred consideration receivable

The deferred consideration receivable balance of £16.5m (2023: £1.9m) relates to the disposal of ICP in July 2018, the disposal of MiExact in January 2024 (see note 11), and the disposal of UK Healthcare in June 2024 (see note 11), with £14.8m recognised within non-current assets and the remaining £1.7m recognised within current assets.

Trade and other receivables

Trade and other receivables reduced to £20.3m (2023: £27.4m) largely due to the disposals of Healthcare and MiExact.

Current tax liability

At 30 June 2024 the Group recognised a liability relating to current tax of £1.1m (2023: £0.1m).

Deferred tax

The deferred tax liability of £1.4m (2023: asset £0.3m) comprises the deferred tax liability for acquired intangibles on acquisition of Astutis, partly offset by a deferred tax credit for the change in corporation tax rate and movement in capital allowances. The deferred tax expense in the P&L £0.1m (2023: £1.1m credit) comprises the change in corporation tax rate and movements in capital allowances.

Trade and other payables

Trade and other payables decreased by £5.5m to £50.5m (2023: £56.0m). Within this, contract liabilities decreased by £5.8m to £27.9m (2023: £33.7m) largely due to the disposals of Healthcare and MiExact.

Provisions

Provisions were £0.2m (2023: £1.2m) in respect of anticipated future costs in relation to the closed proportion of the head office until the end of the contractual lease term. During the year, the lease term on the head office building was renegotiated and we will exit the building in December 2024, the provision was unwound by £0.8m, utilised by £0.2m, and the liability reflects the term until December 2024.

Net cash, lease liabilities and cash flow

Net cash, which includes cash and cash equivalents, cash classified as held for sale and lease liabilities, was £65.0m (2023: £35.0m). This significant net cash position is driven by a strong trading performance delivering improved profits and effective cash management as well as a cash inflow associated with the disposal of businesses offset by the purchase of Astutis. Please refer to note 15 for further information.

Lease liabilities decreased to £2.8m (2023: £7.2m). £0.9m (2023: £2.1m) cash payments in relation to contractual lease obligations were made reducing the balance, the lease modification reduced the balance by £2.7m, coupled with disposals of £1.3m. The reduction is offset by £0.2m (2023: £0.2m) of notional interest on lease liabilities reported within finance costs and additions of £0.3m upon the acquisition of Astutis.

Cash conversion remained strong at 116% (2023: 138%). See note 14 for further details.

Share capital

In October 2023 Wilmington issued 823,568 ordinary voting shares of £0.05 to satisfy the Company's obligations under its Performance Share Plan. In December 2023 Wilmington issued 582,637 ordinary voting shares of £0.05 to satisfy the Company's obligations under its SAYE Plan.

During the year 53,519 shares held by the Employee Share Ownership Trust ('ESOT') were used to satisfy the Company's obligations under the SAYE Plan and 54,610 shares held by the ESOT to satisfy the Company's obligations under its Performance Share Plan. At 30 June 2024, the ESOT held 244,522 shares (2023: 352,651) in the Company, which represents 0.3% (2023: 0.4%) of the called up share capital.

During the year 391 shares held in treasury were used to satisfy the Company's obligations under the SAYE Plan. At 30 June 2024, 4,817 shares (2023: 5,208) were held in treasury, which represents 0.1% (2023: 0.1%) of the share capital of the Company.

Portfolio update

Acquisition of Astutis

In November 2023, we completed the acquisition of Astutis, a training business offering a range of globally recognised and regulated health, safety and environmental qualifications, based in Cardiff, for an initial consideration of £16.8m, with contingent consideration of up to £4.7m based on Astutis' performance in each of the two years ending 30 June 2025 and 30 June 2026. The business has achieved strong growth in recent years in the growing HSE market and is highly complementary to our existing portfolio. The acquisition of Astutis, which is earnings enhancing, is consistent with our strategy in the GRC market to broaden and strengthen our training and education capabilities. Astutis embodies all of our six key business characterises in that it operates in growing GRC focused regulated markets, has a strong and experienced management team, a comprehensive products suite, growing revenues and profits, and excellent digital capabilities. The fair value of the net assets acquired in the business at acquisition date was £9.0m, resulting in goodwill on acquisition of £11.2m. See note 10 for further details.

Disposals

We continue to review all parts of the Group assessing businesses against six key characteristics: organic growth opportunities; attractive markets; digital and data capabilities; strong leadership; strategic fit to the GRC marketplaces; and attractive product, revenue, and profitability characteristics. As part of this ongoing review we determined that our Healthcare, Compliance Week and MiExact businesses no longer met our criteria. MiExact and Healthcare were sold during the year, Compliance Week is in a sale process. We also took the decision to close our business in Singapore and Malaysia due to continuing declining revenues, ongoing losses and little prospect of recovery given the local market conditions. We will continue to serve the Singapore and Malaysia markets from the UK.

MiExact, a UK mortality data business, was sold in January 2024 for £9.6m recognising a gain of £5.9m included within other income. The European Healthcare business was sold in two parts. The first was the disposal of APM, a French healthcare business, for €26.0m in cash in April 2024 recognising a gain on disposal of €23.3m (£19.9m) included within discontinued operations. The second was the sale of the UK healthcare business for a consideration of up to £26.3m recognising a gain on disposal of £1.5m included within discontinued operations. See note 11 for further details.

Consolidated income statement

for the year ended 30 June 2024

		Notes	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
	Continuing operations
	Revenue	4	98,324	93,065
	Operating expenses before amortisation of intangibles excluding computer software, impairment and adjusting items		(76,645)	(73,792)
	Impairment of goodwill	5b	(4,434)	-
	Amortisation of intangible assets excluding computer software	5b	(2,090)	(1,078)
	Adjusting items	5b	(598)	(147)
	Operating expenses		(83,767)	(75,017)
	Other income - gain on disposal of subsidiaries	11	5,465	2,212
	Other income - gain on disposal of property, plant and equipment and lease modification	5a	2,189	-
	Operating profit		22,211	20,260
	Finance income	6	2,172	478
	Finance expense	6	(175)	(246)
	Profit before tax		24,208	20,492
	Taxation	7	(7,009)	(3,317)
	Profit for the year from continuing operations		17,199	17,175
	Profit for the year from discontinued operations	11	24,011	3,020
	Profit for the year attributable to owners of the parent		41,210	20,195
	Earnings per share from continuing operations:
	Basic (p)	9	19.33	19.51
	Diluted (p)	9	18.96	19.03
	Earnings per share from continuing and discontinued operations:
	Basic (p)	9	46.32	22.94
	Diluted (p)	9	45.44	22.38

Consolidated statement of comprehensive income

for the year ended 30 June 2024

		Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
	Profit for the year	41,210	20,195
	Other comprehensive expense:
	Items that may be reclassified subsequently to the income statement
	-Currency translation differences	(238)	(991)
	Other comprehensive expense for the year, net of tax	(238)	(991)
	Total comprehensive income for the year attributable to owners of the parent	40,972	19,204

Balance sheets

as at 30 June 2024

	Notes	2024 £'000	2023 £'000
Non-current assets
Goodwill		52,763	60,561
Other intangible assets		10,236	5,734
Property, plant and equipment		3,085	7,015
Investment in subsidiaries		-	-
Deferred consideration receivable		14,786	1,152
Deferred tax assets		-	925
		80,870	75,387
Current assets
Trade and other receivables	12	20,339	27,391
Deferred consideration receivable		1,732	752
Cash and cash equivalents		67,515	42,173
Assets of disposal group held for sale	11	1,196	-
		90,782	70,316
Total assets		171,652	145,703
Current liabilities
Trade and other payables	13	(50,460)	(55,966)
Lease liabilities		(1,257)	(975)
Current tax liabilities		(1,058)	(44)
Provisions		(154)	(307)
Liabilities of disposal group held for sale	11	(486)	-
		(53,415)	(57,292)
Non-current liabilities
Lease liabilities		(1,571)	(6,235)
Deferred tax liabilities		(1,351)	(607)
Provisions		-	(921)
		(2,922)	(7,763)
Total liabilities		(56,337)	(65,055)
Net assets		115,315	80,648
Equity
Share capital		4,478	4,408
Share premium		47,463	45,553
Treasury and ESOT reserves		(617)	(786)
Share based payments reserve		2,889	2,635
Translation reserve		3,193	3,431
Retained earnings		57,909	25,407
Total equity		115,315	80,648

Statements of changes in equity

for the year ended 30 June 2024

	Share capital, share premium, treasury shares and ESOT shares £'000	Share based payments reserve £'000	Translation reserve £'000	Retained earnings £'000	Total equity £'000
Group
At 1 July 2022	48,851	2,141	4,422	11,675	67,089
Profit for the year	-	-	-	20,195	20,195
Other comprehensive expense for the year	-	-	(991)	-	(991)
	48,851	2,141	3,431	31,870	86,293
Transactions with owners:
Dividends paid	-	-	-	(7,462)	(7,462)
Issue of share capital	17	-	-	-	17
Performance share plan awards vesting	-	(717)	-	854	137
Save As You Earn options settlement via ESOT	154	(11)	-	(16)	127
Save As You Earn options settlement via treasury shares	153	-	-	(64)	89
Share based payments	-	1,222	-	-	1,222
Tax on share based payments	-	-	-	225	225
At 30 June 2023	49,175	2,635	3,431	25,407	80,648
Profit for the year	-	-	-	41,210	41,210
Other comprehensive expense for the year	-	-	(238)	-	(238)
	49,175	2,635	3,193	66,617	121,620
Transactions with owners:
Dividends paid	-	-	-	(9,153)	(9,153)
Issue of share capital	71	-	-	-	71
Issue of share premium	1,910	-	-	-	1,910
Performance share plan awards vesting settlement via share issue	-	(1,109)	-	(139)	(1,248)
Performance share plan options settlement via ESOT	127	(67)	-	-	60
Save As You Earn options vesting settlement via share issue	-	(174)	-	212	38
Save As You Earn options settlement via treasury shares	1	-	-	-	1
Save As You Earn options settlement via ESOT	40	(29)	-	(7)	4
Share based payments	-	1,633	-	-	1,633
Tax on share based payments	-	-	-	379	379
At 30 June 2024	51,324	2,889	3,193	57,909	115,315

Cash flow statements

for the year ended 30 June 2024

		Notes	Year ended 30 June 2024  £'000	Year ended 30 June 2023  £'000
	Cash flows from operating activities
	Cash generated from operations before adjusting items	14	29,747	33,205
	Cash flows for adjusting items - operating activities		(1,826)	(375)
	Cash flows from tax on share based payments		(222)	(2)
	Cash generated from operations		27,699	32,828
	Interest received		1,946	344
	Tax paid		(7,115)	(3,268)
	Net cash generated from operating activities		22,530	29,904
	Cash flows from investing activities
	Disposal of subsidiaries net of cash	11	26,561	1,549
	Purchase of subsidiary net of cash	10	(15,923)	-
	Deferred consideration received		888	250
	Cash flows for adjusting items - investing activities		(59)	(6)
	Purchase of property, plant and equipment		(132)	(461)
	Proceeds from disposal of property, plant and equipment		884	13
	Purchase of intangible assets		(235)	(595)
	Net cash generated from investing activities		11,984	750
	Cash flows from financing activities
	Dividends paid to owners of the parent		(9,153)	(7,462)
	Cash received from sale of shares for share vesting		927	573
	Share issuance costs		(70)	(14)
	Payment of lease liabilities		(881)	(2,109)
	Net cash used in financing activities		(9,177)	(9,012)
	Net increase in cash and cash equivalents		25,337	21,642
	Cash and cash equivalents at beginning of the year		42,173	20,543
	Exchange gain/(loss) on cash and cash equivalents		5	(12)
	Cash classified as held for sale		293	-
	Cash and cash equivalents at end of the year		67,808	42,173

Notes to the financial statements

1. Nature of the Financial Statements

The following financial information does not amount to full financial statements within the meaning of Section 434 of Companies Act 2006.

Financial statements for the year ended 30 June 2023 have been delivered to the Registrar of Companies; the report of the auditors on those accounts was unqualified and did not contain a statement under Section 498 of the Companies Act 2006. The 2024 statutory accounts will be delivered in due course. Information has been extracted from the draft statutory financial statements for the year ended 30 June 2024 which will be delivered to the Registrar of Companies in due course.  Accordingly, the financial information for 2024 is presented unaudited in the preliminary announcement.

Copies of the Annual Report and Financial Statements will be made available to shareholders shortly and printed copies will be available from the Company's registered office at 10 Whitechapel High Street, London, E1 8QS.

2. Statement of accounting policies

The preliminary announcement for the year ended 30 June 2024 has been prepared in accordance with UK adopted international accounting standards (UK adopted IAS). The accounting policies applied in this preliminary announcement are consistent with those reported in the Group's Annual Financial Statements for the year ended 30 June 2023. There was no material effect from the adoption of new standards or interpretations in the year ended 30 June 2024.

3. Measures of profit

Reconciliation to profit on continuing activities before tax

To provide shareholders with additional understanding of the trading performance of the Group, adjusted EBITA has been calculated as profit before tax after adding back:

•     impairment of goodwill;

•     amortisation of intangible assets excluding computer software;

•     adjusting items (included in operating expenses);

•     other income - gain on disposal of subsidiaries;  

•     other income - gain on disposal of property, plant and equipment and lease modification; and

•     net finance income.

Adjusted profit before tax, adjusted EBITA and adjusted EBITDA reconcile to profit on continuing activities before tax as follows:

	Year ended  30 June 2024 £'000	Year ended  30 June 2023 £'000
Profit before tax	24,208	20,492
Impairment of goodwill	4,434	-
Amortisation of intangible assets excluding computer software	2,090	1,078
Adjusting items (included in operating expenses)	598	147
Other income - gain on disposal of subsidiaries	(5,465)	(2,212)
Other income - gain on disposal of property, plant and equipment and lease modification	(2,189)	-
Adjusted profit before tax	23,676	19,505
Net finance income	(1,997)	(232)
Adjusted operating profit ('adjusted EBITA')	21,679	19,273
Depreciation of property, plant and equipment included in operating expenses	1,711	2,121
Amortisation of intangible assets - computer software	1,004	1,525
Adjusted EBITA before depreciation ('adjusted EBITDA')	24,394	22,919

Adjusted EBITA	21,679	19,273
Add EBITA from statutory discontinued operations	3,874	4,833
Total Group adjusted EBITA	25,553	24,106

Adjusted profit before tax	23,676	19,505
Add adjusted profit before tax from statutory discontinued operations	3,874	4,833
Total Group adjusted profit before tax	27,550	24,338
Remove operating profit from sold and closed businesses	(3,484)	(7,410)
Ongoing adjusted profit before tax	24,066	16,928

4. Segmental information

In accordance with IFRS 8 the Group's operating segments are based on the operating results reviewed by the Executive Board, which represents the chief operating decision maker.

During the year, the Group reorganised its business into three Divisions (HSE, Legal and Financial Services) to compliment the changes to the Group structure as a result of the significant disposals and the acquisition, the segments give greater focus to the customer base. These reportable segments reflect the internal reporting provided to the Chief Operating Decision Maker (the Executive Board) on a regular basis to assist in making decisions and to assess performance. Segment information has been restated in the prior period to align to the current reportable segments.

The Group's dynamic portfolio provides customers with a range of information, data, training and education solutions. The Board considers the business from both a geographic and product perspective. Geographically, management considers the performance of the Group between the UK, Europe (excluding the UK), the USA and the Rest of the World.

a) Business segments

	Revenue Year ended 30 June 2024 £'000	Profit/(loss) Year ended 30 June 2024 £'000	Revenue Year ended 30 June 2023 £'000	Profit  Year ended 30 June 2023 £'000
HSE	4,837	1,201	-	-
Legal	15,986	6,173	14,014	6,014
Financial Services	68,850	20,726	64,717	15,900
Ongoing	89,673	28,100	78,731	21,914
Non-core	8,651	(390)	14,334	2,577
Group total	98,324	27,710	93,065	24,491
Unallocated central overheads	-	(4,166)	-	(3,703)
Share based payments	-	(1,865)	-	(1,515)
	98,324	21,679	93,065	19,273
Impairment of goodwill		(4,434)		-
Amortisation of intangible assets excluding computer software		(2,090)		(1,078)
Adjusting items (included in operating expenses)		(598)		(147)
Other income - gain on disposal of subsidiaries		5,465		2,212
Other income - gain on disposal of property, plant and equipment and lease modification		2,189		-
Net finance income		1,997		232
Profit before tax from continuing operations		24,208		20,492
Taxation		(7,009)		(3,317)
Profit for the financial year from continuing operations		17,199		17,175

There are no intra-segmental revenues which are material for disclosure. Unallocated central overheads represent central costs that are not specifically allocated to segments. Total assets and liabilities for each reportable segment are not presented; as such information is not provided to the Board.

b) Segmental information by geography

The UK is the Group's country of domicile and the Group generates the majority of its revenue from external customers in the UK. The geographical analysis of revenue is on the basis of the country of origin in which the customer is invoiced:

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
UK	52,353	49,441
USA	25,761	24,050
Europe (excluding the UK)	10,777	10,481
Rest of the World	9,433	9,093
Revenue from continuing operations	98,324	93,065

c) Timing of revenue recognition

The timing of the Group's revenue recognition is as follows:

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
Revenue from products and services transferred at a point in time	60,322	55,223
Revenue from products and services transferred over time	38,002	37,842
Revenue from continuing operations	98,324	93,065

During the year the Group recognised £33,659,000 of revenue that was held as a contract liability at 30 June 2023 (2023: £31,405,000 related to amounts held at 30 June 2022).

5. Profit from continuing operations

a) Profit for the year from continuing operations is stated after charging/(crediting):

	Year ended  30 June 2024 £'000	Year ended  30 June 2023 £'000
Depreciation of property, plant and equipment - included in operating expenses	1,711	2,121
Short-term and low-value leases	143	94
Amortisation of intangible assets - computer software	1,004	1,525
Non-adjusting profit on disposal of property, plant and equipment	-	(36)
Share based payments (including social security costs)	1,865	1,515
Amortisation of intangible assets excluding computer software	2,090	1,078
Adjusting items (included in operating expenses)	598	147
Adjusting item - gain on disposal of subsidiaries	(5,465)	(2,212)
Adjusting item - gain on sale of property, plant and equipment and lease modification	(2,189)	-
Research and development expenditure credit	-	(200)
Impairment of goodwill	4,434	-
Foreign exchange loss	87	179
Fees payable to the auditor for the audit of the Company and consolidated financial statements	209	153
Fees payable to the auditor and their associates for other services:
- The audit of the Company's subsidiaries pursuant to legislation	241	240
- Audit related other services	17	17

The gain on property, plant and equipment and lease modification relates to the sale of a building realising a gain of £0.9m, and an early exit of the head office lease releasing a gain of £1.3m. The gain on exit of the head office contains a lease modification. The right-of use asset was reduced by £1.0m and the lease liability was reduced by £2.8m, property, plant and equipment were impaired by £0.4m, a provision was unwound of £0.8m, and professional fees and a lease surrender expense of £0.9m were recognised.

b) Adjusting items

The following items have been charged to the income statement during the year but are considered to be adjusting so are shown separately:

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
Expense relating to strategic activities	598	147
Other adjusting items (included in operating expenses)	598	147
Impairment of goodwill	4,434	-
Amortisation of intangible assets excluding computer software	2,090	1,078
Total adjusting items (classified in profit before tax)	7,122	1,225

During the year, the Compliance Week CGU was impaired. Expenses related to strategic activities represent acquisition costs of £0.6m.

6. Finance income and expense

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
Interest receivable on cash and cash equivalents	1,953	373
Unwinding of the discount on royalty payments receivable	219	105
Finance income	2,172	478
Interest expense for lease liabilities	(175)	(246)
Finance expense	(175)	(246)
Net finance income	1,997	232

7. Taxation

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
Current tax
UK corporation tax at current rates on UK profits for the year	5,009	3,096
Adjustments in respect of previous years	394	(54)
	5,403	3,042
Foreign tax	1,568	1,291
Adjustments in respect of previous years	(19)	89
Total current tax	6,952	4,422
Total deferred tax	57	(1,105)
Taxation from continuing operations	7,009	3,317

Factors affecting the tax charge for the year:

The effective tax rate is higher (2023: lower) than the average rate of corporation tax in the UK of 25.0% (2023: 20.5%). The differences are explained below:

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
Profit before tax	24,208	20,492
Profit before tax multiplied by the average rate of corporation tax in the year of 25.0% (2023: 20.5%)	6,052	4,200
Tax effects of:
Impairment of goodwill	1,109	-
Gain on disposal of subsidiaries	(1,367)	(453)
Foreign tax rate differences	156	178
Adjustment in respect of previous years	379	35
Other items not subject to tax	623	462
Deferred tax UK intangibles and capital allowances movement	(88)	(904)
Effect on deferred tax of a change in the corporation tax rate	408	(83)
Other deferred tax movements	(263)	(118)
Taxation from continuing operations	7,009	3,317

Deferred tax assets and liabilities are measured at the rates that are expected to apply in the periods of the reversal.

The Company's profits for this accounting year are taxed at an effective rate of 29.4% (2023: 16.2%).

The tax effect of adjusting items as disclosed in note 9 is an expense of £571,000 (2023: credit of £1,598,000).

8. Dividends

Amounts recognised as distributions to owners of the parent in the year:

	Year ended 30 June 2024 Pence per share	Year ended 30 June 2023 Pence per share	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
Final dividends recognised as distributions in the year	7.3	5.8	6,473	5,091
Interim dividends recognised as distributions in the year	3.0	2.7	2,680	2,371
Total dividends paid			9,153	7,462
Final dividend proposed	8.3	7.3	7,297	6,410

9. Earnings per share

Adjusted earnings per share has been calculated using adjusted earnings calculated as profit after taxation but before:

•     impairment of goodwill;

•     amortisation of intangible assets excluding computer software;

•     adjusting items (included in operating expenses);

•     other income - gain on disposal of subsidiaries; and

•     other income - gain on disposal of property, plant and equipment and lease modification.

The calculation of the basic and diluted earnings per share is based on the following data:

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
Continuing operations:
Earnings from continuing operations for the purpose of basic earnings per share	17,199	17,175
Add/(remove):
Impairment of goodwill	4,434	-
Amortisation of intangible assets excluding computer software	2,090	1,078
Adjusting items (included in operating expenses)	598	147
Other income - gain on disposal of subsidiaries	(5,465)	(2,212)
Other income - gain on disposal of property, plant and equipment and lease modification	(2,189)	-
Tax effect of adjustments above and deferred tax	571	(1,598)
Adjusted earnings for the purposes of adjusted earnings per share	17,238	14,590
Continuing and discontinued operations:
Earnings from total operations for the purpose of basic earnings per share	41,210	20,195
Add/(remove):
Impairment of goodwill	4,434	-
Amortisation of intangible assets excluding computer software	2,637	2,381
Adjusting items (included in operating expenses)	598	147
Other income - gain on disposal of subsidiaries	(26,831)	(2,212)
Other income - gain on disposal of property, plant and equipment and lease modification	(2,189)	-
Tax effect of adjustments above and deferred tax	571	(1,598)
Adjusted earnings for the purposes of adjusted earnings per share	20,430	18,913

	2024 Number	2023 Number
Continuing operations:
Weighted average number of ordinary shares for the purposes of basic and adjusted earnings per share	88,964,817	88,027,119
Effect of dilutive potential ordinary shares:
Future exercise of share awards and options	1,722,761	2,217,174
Weighted average number of ordinary shares for the purposes of diluted and adjusted diluted earnings per share	90,687,578	90,244,293
Continuing and discontinued operations:
Weighted average number of ordinary shares for the purposes of basic and adjusted earnings per share	88,964,817	88,027,119
Effect of dilutive potential ordinary shares:
Future exercise of share awards and options	1,722,761	2,217,174
Weighted average number of ordinary shares for the purposes of diluted and adjusted diluted earnings per share	90,687,578	90,244,293
Continuing operations:
Basic earnings per share	19.33p	19.51p
Diluted earnings per share	18.96p	19.03p
Adjusted basic earnings per share ('adjusted earnings per share')	19.38p	16.57p
Adjusted diluted earnings per share	19.01p	16.17p
Continuing and discontinued operations:
Basic earnings per share	46.32p	22.94p
Diluted earnings per share	45.44p	22.38p
Adjusted basic earnings per share ('adjusted earnings per share')	22.96p	21.49p
Adjusted diluted earnings per share	22.53p	20.96p

10. Acquisition of Astutis

On 23 November 2023, the Group acquired 100% of the issued share capital of Astutis Limited ("Astutis"), a Company based in the United Kingdom, for an initial consideration of £16.8m. In addition, under the terms of the acquisition, there are two potential deferred payments totalling up to £4.7m based on Astutis' performance in each of the two years ending 30 June 2025 and 30 June 2026. As the deferred payments are linked to employment, they will be recognised as a separate transaction in each period respectively as they fall due.

Astutis, which offers training for a range of globally recognised and regulated health, safety and environmental qualifications, strengthens Wilmington's portfolio of GRC training and education solutions by expanding its capabilities into the health, safety and environmental markets. The acquisition is part of Wilmington's strategy to focus on consolidating its already strong presence in the large, growing and rapidly evolving GRC markets. These markets are underpinned by strong macro drivers, particularly the increasing volume and enforcement of regulation, complex geopolitical landscape, increased importance of ESG and widespread adoption of technological and data-driven compliance solutions. Goodwill acquired relates to synergies and access to the health, safety and environmental markets.

The fair value of the net assets acquired in the business at acquisition date was £9.0m, resulting in goodwill on acquisition of £11.2m. Acquisition related charges include transaction costs of £0.6m relating to the acquisition of Astutis. The results of the acquisition included in the Group's consolidated results are revenue of £4.8m and an operating result of £1.2m. Due to limitations in available data for the pre-acquisition period, the Directors consider that it is impracticable to disclose the results of the combined entity as though the acquisition had impacted the Group's consolidated results for the full year. The goodwill recognised is not deductible for tax purposes.

A summary of the acquisition is detailed below:

	£'000
Fair value of net assets acquired
Intangibles	9,861
Property, plant and equipment	336
Trade and other receivables	1,880
Cash and cash equivalents	4,207
Trade and other payables	(4,510)
Current tax liability	(494)
Deferred tax liability	(1,995)
Lease liability	(311)
Net assets acquired	8,974
Goodwill	11,156
Final working capital adjustments	(1,174)
Total cash consideration	18,956
Final working capital adjustments paid in cash	1,174
Cash acquired	(4,207)
Total cash outflow	15,923

11. Disposals, disposal group held for sale and discontinued operations

Disposal of MiExact

On 31 January 2024 the Group disposed of its mortality data business, MiExact Limited, for consideration of £9.6m prior to working capital adjustments and recognised a gain on disposal of £5.9m presented within other income.

Wilmington received cash of £6.9m on completion after working capital adjustments, and the remaining £3.0m was issued as a loan note with a 7% coupon, deferred for up to three years.

The disposal was executed by way of the sale of 100% of the equity shares. Net assets on disposal were £2.9m, a breakdown can be found in the table below.

MiExact has not been classified as a discontinued operation under IFRS 5 because it does not meet the IFRS 5 criteria as a significant line of business.

Disposal of APM (part of the European Healthcare business)

On 26 April 2024 the Group disposed of its French Healthcare business, APM, for consideration of €26.0m (£22.3m) in cash, prior to working capital adjustments and recognised a gain on disposal of €23.3m (£19.9m) presented within discontinued operations.

The disposal was executed by way of the sale of 100% of the equity shares. Net assets on disposal were £1.9m, a breakdown can be found in the table below.

The European Healthcare business, consisting of APM and UK Healthcare, has been classified as a discontinued operation under IFRS 5 because it meets the IFRS 5 criteria as a significant line of business. Please see below for further information.

Disposal of UK Healthcare (part of the European Healthcare business)

On 27 June 2024 the Group disposed of its UK Healthcare business for consideration of up to £26.3m. The UK Healthcare business includes the entire issued share capital of Wilmington Healthcare Limited and Interactive Medica SL. This transaction completes Wilmington's sale of its European Healthcare businesses, following the disposal of the Group's French Healthcare business, APM, announced on 26 April 2024 for €26m.

The initial consideration of £21.3m comprises £4.8m in cash with the balance of £16.5m satisfied through the issue by the purchaser of secured loan notes for a term of up to four years, carrying a variable interest rate equal to the Bank of England base rate with some principal repayments throughout the term. The transaction realised a gain on disposal of £1.5m presented within discontinued operations.

The total consideration of £21.3m will increase by up to approximately £5.1m, subject to the UK Healthcare business achieving certain EBITDA targets for the financial year ending 30 June 2025. This contingent consideration has not been recognised as part of consideration because of the assessed likelihood of meeting the specified targets.

The disposal was executed by way of the sale of 100% of the equity shares. Net assets on disposal were £15.2m, a breakdown can be found in the table below.

The European Healthcare business, consisting of APM and UK Healthcare, has been classified as a discontinued operation under IFRS 5 because it meets the IFRS 5 criteria as a significant line of business. Please see below for further information.

Revision of ICP

The disposal proceeds for the 2018 disposal of ICP were renegotiated to ensure payment would actually be received, resulting in a reduction in the profit on disposal of £414,000 presented within other income.

Net assets as at the disposal dates:

The disposals were executed by way of the sale of 100% of the equity shares and as at each disposal date, the net assets were as follows:

	MiExact £'000	APM £'000	UK Healthcare £'000	ICP £'000	Total £'000
Goodwill	2,391	-	11,885
Intangibles	-	89	1,734
Property, plant and equipment	13	1,435	3
Deferred tax asset	-	-	33
Current tax asset	-	392	95
Trade and other receivables	898	2,195	5,114
Cash and cash equivalents	1,038	4,141	2,942
Trade and other payables	(1,414)	(5,017)	(6,654)
Lease liabilities	-	(1,300)	-
Net assets disposed	2,926	1,935	15,152		20,013
Directly attributable costs of disposal	638	1,104	1,618		3,360
Recycling of foreign exchange (gain)/loss	-	25	(262)		(237)
Gain on disposal included within discontinued operations	-	19,912	1,454		21,366
Gain/(loss) on disposal included within other income	5,879	-	-	(414)	5,465
Fair value of consideration during the year	9,443	22,976	17,962	(414)	49,967
Satisfied by:
Cash and cash equivalents	6,894	22,976	4,812		34,682
Fair value of deferred consideration	2,549	-	13,150	(414)	15,285
	9,443	22,976	17,962	(414)	49,967

Cash received	6,894	22,976	4,812		34,682
Less cash disposed	(1,038)	(4,141)	(2,942)		(8,121)
Total cash inflow	5,856	18,835	1,870		26,561

The disposals reflect the Group's continued and active management of its portfolio to assess the potential of each business to exhibit the six common Wilmington characteristics that we recognise as key drivers of organic revenue growth and profitability improvement.

European Healthcare business (UK Healthcare & APM) classified as a discontinued operation

The European Healthcare business (consisting of APM and UK Healthcare) has been classified as a discontinued operation in the year with the financial results, including the comparatives, presented separately. The operation meets the IFRS 5 definition as a discontinued operation due to it being a separate major line of business and part of single coordinated disposal plan.

The table below shows the results of the discontinued operation, which is included separately in the Consolidated Income Statement.

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
European Healthcare
Revenue	27,679	30,432
Operating expenses before amortisation of intangibles excluding computer software	(23,805)	(25,599)
Amortisation of intangible assets excluding computer software	(547)	(1,303)
Operating expenses	(24,352)	(26,902)
Operating profit	3,327	3,530
Profit before tax	3,327	3,530
Taxation	(682)	(510)
Profit after tax	2,645	3,020
Gain on disposal	21,366	-
Profit after tax from discontinued operations	24,011	3,020

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
European Healthcare
Net cash generated from operating activities	208	4,070
Net cash used in investing activities	20,574	(164)
Net cash used in financing activities	(151)	(176)
Net increase in cash & cash equivalents	20,631	3,730

Compliance Week classified as a disposal group held for sale

During the year, the Compliance Week businesses, has been classified as a disposal group held for sale under IFRS 5.

The Group is focused on actively managing our portfolio by assessing the potential of each business to exhibit the six common Wilmington characteristics that we recognise as key drivers of organic revenue growth and profitability improvement. Consequently, as a result of this assessment, the Board decided to exit the Compliance Week business. The disposal is expected to be completed within one year by sale of equity shares.

The major classes of assets and liabilities comprising the disposal group held for sale are as follows:

	30 June 2024  £'000
Goodwill	358
Trade and other receivables	545
Cash and cash equivalents	293
Assets of disposal group held for sale	1,196
Trade and other payables	486
Liabilities of disposal group held for sale	486

Compliance Week has not been classified as a discontinued operation under IFRS 5 because it does not meet the IFRS 5 criteria as a significant line of business.

12. Trade and other receivables

	30 June 2024 £'000	30 June 2023 £'000
Current
Trade receivables	16,104	22,577
Prepayments and other receivables	3,712	3,758
Contract assets	523	1,056
	20,339	27,391

Amounts due from all subsidiaries are interest free, unsecured and repayable on demand with the intention to repay within the year. Expected credit losses on amounts due from subsidiaries are immaterial.

13. Trade and other payables

	30 June  2024 £'000	30 June 2023 £'000
Trade payables	5,021	3,039
Social security and other taxes	2,353	3,418
Accruals	14,499	15,425
Contract liabilities	27,887	33,659
Other payables	700	425
	50,460	55,966

Amounts due to subsidiaries are interest free, unsecured and repayable on demand.

14. Cash generated from operations

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
From continuing and discontinued operations:
Profit before tax from continuing operations	24,208	20,492
Profit before tax from discontinued operations	24,694	3,530
Adjusting item - gain on disposal of subsidiaries included in continuing operations	(5,465)	(2,212)
Adjusting item - gain on disposal of subsidiaries included in discontinued operations	(21,367)	-
Adjusting item - gain on sale of property, plant and equipment and lease modification (see note 5a)	(2,189)	-
Adjusting items	598	147
Depreciation of property, plant and equipment included in operating expenses	1,851	2,321
Amortisation of intangible assets (continuing and discontinued)	3,662	4,071
Impairment of goodwill	4,434	-
Non-adjusting profit on disposal of property, plant and equipment	-	(36)
Share based payments (including social security costs)	1,865	1,515
Net finance income	(1,997)	(232)
Operating cash flows before movements in working capital	30,294	29,596
Increase in trade and other receivables	(2,784)	(107)
Increase in trade and other payables	2,545	4,023
Decrease in provisions	(308)	(307)
Cash generated from operations before adjusting items	29,747	33,205

Cash conversion is calculated as a percentage of cash generated by operations to adjusted EBITA as follows:

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
From continuing and discontinued operations:
Funds from operations before adjusting items:
Adjusted EBITA from continuing operations (note 3)	21,679	19,273
Adjusted EBITA from discontinued operations	3,874	4,833
Share based payments (including social security costs)	1,865	1,515
Amortisation of intangible assets - computer software (continuing and discontinued)	1,025	1,690
Depreciation of property, plant and equipment (continuing and discontinued)	1,851	2,321
Non-adjusting profit on disposal of property, plant and equipment	-	(36)
Operating cash flows before movement in working capital	30,294	29,596
Net working capital movement	(547)	3,609
Funds from operations before adjusting items	29,747	33,205
Cash conversion	116%	138%

	Year ended 30 June 2024 £'000	Year ended 30 June 2023 £'000
Free cash flow:
Operating cash flows before movement in working capital	30,294	29,596
Proceeds on disposal of property, plant and equipment	884	13
Net working capital movement	(547)	3,609
Interest received	1,946	344
Payment of lease liabilities	(881)	(2,109)
Tax paid	(7,115)	(3,268)
Purchase of property, plant and equipment	(132)	(461)
Purchase of intangible assets	(235)	(595)
Free cash flow	24,214	27,129

15. Reconciliation of net cash movements

		Year ended 30 June 2024  £'000	Year ended 30 June 2023  £'000
Cash and cash equivalents at beginning of the year		42,173	19,785
Cash classified as held for sale		-	758
Lease liabilities at beginning of the year		(7,210)	(7,510)
Net cash at beginning of the year		34,963	13,033
Net increase in cash and cash equivalents		25,635	21,630
Movement in lease liabilities		4,382	300
Cash and cash equivalents at end of the year		67,515	42,173
Cash classified as held for sale at end of the year		293	-
Lease liabilities at end of the year		(2,828)	(7,210)
Net cash at end of the year		64,980	34,963

16. Events after the reporting period

There were no events after the balance sheet date that require disclosure.

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[1] Ongoing - eliminating the effects of the impact of disposals, closures and businesses held for sale; Organic - Ongoing, eliminating acquisitions and exchange rate fluctuations.

[2] Ongoing adjusted profit before tax and total adjusted profit before tax - see note 3.

[3] Ongoing adjusted basic earnings per share; Adjusted basic earnings per share - see note 9.

[4] Net cash includes cash and cash equivalents, bank loans (excluding capitalised loan arrangement fees) and bank overdrafts but excludes lease liabilities.

[5] Ongoing - eliminating the effects of the impact of disposals, closures and businesses held for sale; Organic - Ongoing, eliminating acquisitions and exchange rate fluctuations.

[6] The HSE division consists of the Astutis business.

[7] The Legal division consists of the Bond Solon and Pendragon businesses.

[8] The Financial Services division consists of Axco & FRA in the Insurance subdivision and Mercia, CLTi & the ICA businesses within the Other subdivision.

[9] Total revenue & operating profit includes all results in the Group including non-core businesses consisting of MiExact, Compliance Week, Healthcare, APM, ICA Singapore & Malaysia. Non-core in FY23 also includes Inese.

 

END