Final Results and Notice of AGM

RNS Number : 2187V

SigmaRoc PLC

13 April 2021

SigmaRoc plc / EPIC: SRC / Market: AIM / Sector: Construction & Materials

13 April 2021

SigmaRoc plc

('SigmaRoc', the 'Company' or the 'Group')

Audited full year results for year ended 31 December 2020

Notice of AGM

SigmaRoc plc, the AIM listed buy-and-build construction materials group, is pleased to announce its audited results for the year ended 31 December 2020.

Financial highlights¹	31 December 2020	31 December 2019	Change
Underlying revenue	£124.2m	£70.4m	+76.6%
Underlying EBITDA	£23.9m	£14.5m	+64.1%
Underlying profit before tax	£12.2m	£8.4m	+45.2%
Underlying EPS	4.50p	4.20p	+7%
Adjusted Leverage Ratio²	1.69x	2.07x	-18.4%

¹ Underlying results are stated before acquisition related expenses, certain finance costs, redundancy and reorganisation costs, impairments, amortisation of acquisition intangibles and share option expense. References to an underlying profit measure throughout this Annual Report are defined on this basis.

² Adjusted leverage ratio compares net debt to underlying EBITDA for the last twelve months adjusted for pre-acquisition earnings of subsidiaries acquired during the year.

Operational highlights:

Invest

- GD Harries: Completion of 100% ownership

- Benelux: 168mt expansion at CDH approved

- Equity raise: 12.4m raised for H1 2021 pipeline projects

Improve

- Safety: Completion of Safety external audits and introduction of HighVizz

- Operation gearing: Underlying EBITDA margin remained strong at 19%

- Corporate Governance: Appointment of independent non-executive directors and dedicated general counsel

Integrate

- Group debt facility: Consolidation of debt facilities following acquisition of CDH

- Integration of CDH: >400 people

- Integration of GD Harries: >200 people

Innovate

- Sustainability: Innovation in concrete products and asphalt solutions

- Digital solutions: Enhancement of safety, operations and asset utilisation

- Products: Supply of innovative product for major project

Annual General Meeting

SigmaRoc is also pleased to provide notice that its Annual General Meeting ('AGM') will be held on 19 May 2021 at 3.00 p.m. at 56 Queen Anne Street, London, W1G 8LA. Copies of the Notice of AGM, together with the Form of Proxy and Annual Report have been posted to shareholders and are available to view on the Company's website.

We are keen to welcome Shareholders in person to our AGM this year, particularly given the constraints we faced in 2020 due to the COVID-19 pandemic. We are therefore proposing to welcome the maximum number of Shareholders we are able within safety constraints and in accordance with government guidelines.

Shareholders intending to attend the AGM, should this be possible, are asked to register their intention to attend as soon as practicable by emailing agm@sigmaroc.com.

Given the uncertainty around potentially tighter restrictions due to the COVID-19 pandemic, which could change at short notice, it cannot be known with certainty whether (or how many) Shareholders will be able to attend the AGM. Accordingly, we encourage all Shareholders to complete and return a completed proxy form appointing David Barrett, Executive Chairman, as the Chair of the Meeting, as their proxy. This will ensure that your vote will be counted if ultimately you (or any other proxy you might otherwise appoint) are not able to attend the Meeting.

David Barrett, Executive Chairman, commented:

"In what proved to be a very challenging year, I am extremely proud that our business has performed so well, with our robust and agile business model delivering growth despite the unprecedented circumstances. We delivered revenue of £124.2million and increased both our Underlying EBITDA and our underlying EPS. We completed the acquisition of GD Harries and prepared our Balance Sheet for future growth with the completion of a debt refinancing."

"I am confident that we will continue on the road to further success, building on the solid foundations we have laid down during our first four years."

Max Vermorken, CEO, commented:

"I would like to thank the SigmaRoc team for their extraordinary hard work throughout 2020. Despite the pandemic we were able to deliver an extremely strong performance, driving our revenues up by 64% to £124.2 million, and increasing Underlying EBITDA to £23.9 million. Underlying earnings per share grew by 7% to 4.50p in a year of very difficult trading conditions."

"Looking forward, we continue to seek ways to invest, improve, integrate and innovate, and in the first quarter of 2021 we launched our cement free concrete building block - Greenbloc. We also recently entered into an agreement with LafargeHolcim which will see an expansion of our aggregates operations in Belgium and, subsequent to that, we acquired two large-scale concrete suppliers in the Limburg area of Belgium."

"I am excited for the future path of the Group and I am optimistic that with our great workforce and support of our investors, we can continue to further grow and achieve strong results in the months and years ahead"

END

The full text of the statement is set out below, together with detailed financial results.

SigmaRoc will host a meeting for invited analysts at 8.00 a.m. To participate in the call, please register by contacting ir@sigmaroc.com.

The Group has also organised a dedicated results call and Q&A session for private investors at 12.00 p.m. today. To participate in the call, please register interest via the following link: https://zoom.us/webinar/register/WN_4tkkjmz9TxO0P8-ZPmAZPA .

A recording will also be available on request from the Company

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For further information, please contact:

SigmaRoc plc

Max Vermorken

Tel: +44 (0) 207 002 1080

Strand Hanson Limited (Nominated and Financial Adviser)

James Spinney / James Dance / Rob Patrick

Tel: +44(0) 207 409 3494

Liberum Capital (Co-Broker)

Neil Patel / Jamie Richards / William Hall

Tel: +44 (0) 203 100 2000

Peel Hunt (Co-Broker)

Mike Bell/Ed Allsopp

Tel: +44 (0) 20 7418 8900

Investor Relations

Florian Werner

Tel: +44 (0) 207 002 1080

ir@sigmaroc.com

CHAIRMAN'S STATEMENT

My 45 years in the construction materials industry was still not enough to anticipate and prepare for the extraordinary year we witnessed in 2020. I am extremely proud that despite such challenging circumstances our business performed very well, thanks to a sound business model, high quality teams with motivated staff around the Group and the ability to respond quickly to changing circumstances. As a result, we delivered revenue of 124 million, Underlying EBITDA of 24 million and Underlying Earnings per share of 4.5 pence. Another year of growth despite the exceptional challenges as we continue with the journey of SigmaRoc.

Our timely response allowed us to do more than just manage the unprecedented health crisis. As a Group we adapted our methods of work to remain 'open for business' and also delivered several key infrastructure projects which helped the UK both battle the pandemic and prepare for Brexit. Our improvement projects continued at the most recently acquired businesses. We also prepared our Balance Sheet for further growth through a debt refinancing and a very well supported equity fundraise. To summarise, 2020 was another year of significant progress for the SigmaRoc group of companies.

Growth

At the start of 2020, it was our ambition to continue the trend set in 2019 and sustain our momentum. Our plans included an ambitious debt refinancing, the acquisition of the remaining 60% of G.D. Harries, the improvement of margins and operational quality across the Group and a continued focus on Sustainability initiatives. 

While the pandemic slowed our progress, I am happy to report we delivered most of our initial objectives even as we managed the impact of COVID-19 on our Group. G.D. Harries now fully forms part of SigmaRoc. Our new debt facilities allow us to pursue further growth, and we are grateful for the continued support of Santander together with a consortium of high quality European and UK banks. As a result, our Group now starts to gain scale where an important source of its further development will be funded from internally generated free cash flows, to the benefit of our Shareholders.

Safety and COVID-19

2020 presented a very significant challenge from a Health & Safety perspective, both due to COVID-19 and operationally. Protecting our staff from COVID-19 and ensuring the virus did not spread within the business was key. We were successful inasmuch as only 34 COVID-19 self-isolation cases were recorded. This across the Group of nearly 1,000 staff and pleasingly no confirmed spread of the virus within the business was recorded.

A second real challenge was managing our operational safety. With travel restrictions, people working from home and people coming back into the workplace after a period of absence, the risk of accidents and the probability of a lack of reporting increases. However, the outcome was contrary to that probability. Our LTIFR reduced 22% and TIFR reduced 6%. During the same period our number of reported incidents increased materially in part due to improved safety software and monitoring tools.

Governance

Last year was also a year of significant progress from a governance perspective. Our Group had grown rapidly since inception in 2017 and required a review of its Board and governance structures, which we started in 2019. As a result of this process, we restructured our Board composition, adding two high calibre independent non-executive directors in Jacques Emsens and Simon Chisholm. We improved our corporate governance principles and reviewed the various Board committees to ensure the right processes are in place. We also appointed Anthony Brockbank as General Counsel. Anthony's expertise and experience in governance and corporate law will ensure our compliance has a further level of scrutiny and robustness. 

We also made a significant leap forward in our Environmental and Social initiatives with a substantial section of this report dedicated to these efforts. Our combined Environmental, Social and Governance initiatives will become an ever more important component of our activities and we are proud of our low carbon concrete products offering, our partnerships with several innovative companies, our focus on renewable energy sources where possible and our attention to our operating footprint and what can be done to improve it.

Forward look

Looking forward I remain convinced we are on the right track for further success to be built on the solid foundations laid down during our first four years. This past year was particularly challenging for most businesses, and for many, personally. Our performance has demonstrated the quality of our business model, the determination of our management teams, the dedication of an exceptional workforce and the potential our Group has for the future.

As we progress through 2021, I am convinced we will continue on the road to further success. We have an exciting list of projects on which we are actively working. We have several high quality businesses in our Group which can continue to deliver great results. We also have a series of more recently acquired businesses which are the focus of our attention to improve and integrate them to the benefit of the wider Group. I therefore remain optimistic and curious as to what future opportunities SigmaRoc can take advantage of for the benefit of the Group and its Shareholders.

David Barrett

Executive Chairman

12 April 2021

CEO's STRATEGIC REPORT

2020 was the year of "unknown unknowns". Nobody was fully prepared for 2020 and in all honesty, neither were we. A dedicated workforce, a business model built for speed and agility and networks of supportive customers and suppliers helped us through the worst of it and onto another successful year. It is with a great sense of humility and gratitude for the extraordinary hard work of the SigmaRoc team throughout 2020 that I present this annual report.

Financial performance

In 2020, we outperformed pre-COVID broker estimates set at the end of 2019. With revenues at £124.2 million, underlying EBITDA increasing to £23.9 million, a 64.1% year-on-year increase and underlying profit before tax at £12.2 million we delivered an extremely strong performance. Underlying earnings per share rose to 4.50 pence, a 7% growth on 2019, in a year with significant volume swings, margin erosion and difficult trading conditions. Given the circumstances we are extremely proud that we were able to post another year of earnings growth for our Shareholders.

Significant efforts were made over the course of 2019 and 2020 to improve the margins across the Group, targeting Underlying EBITDA margins of over 20%. Even as 2020 was a particularly challenging year with significant volume swings, and the full integration of lower margin businesses in Wales and Belgium, our overall Underlying EBITDA margins remained strong at 19%. Over the course of the next 18 months as our improvement efforts take hold, we aim to see that margin increase to our targeted level of 20%.

As a result of our good performance and several restructuring efforts in 2019, cash generation was strong in 2020. Starting the year with £9.9 million we ended the year with £27.4 million, (including the addition of £12.4 million cash raised in December 2020) and after the deduction of several significant investments. These investments include the acquisition of the remaining 60% stake in G.D. Harries at 7.3 million, the payment of deferred consideration in Belgium of circa £2 million, the acquisition of further land in Belgium for the quarry extension of approximately £2 million, as well as further general capital investments into the business.

The solid trading, margin improvement and cash generation has had further positive consequences on the quality of our Balance Sheet. Starting the year with £49.8 million in net debt to Underlying EBITDA equating to a ratio of 2.07 times we finished the year at 1.69 times. This figure includes the full consolidation of G.D. Harries in South Wales, which historically held higher net debt levels than our Group's targeted ratio. Efforts are currently being made to ensure the overall debt levels of the Group do not exceed a 2 times net debt to Underlying EBITDA ratio after cash is spent on further acquisitions, with the intention of a further downward trend.

Considering total and net tangible assets, further improvements were also realised through the completion of the PPA process for Carrieres du Hainaut and the inclusion of G.D. Harries. A separate PPA process will be undertaken for G.D. Harries during this year even though the business has only a limited amount of goodwill at acquisition. Both businesses are significantly asset backed, increasing our total tangible assets to £145 million at 31 December 2020. Calculating our total debt to tangible assets we arrive at a ratio of below 2:1, further demonstrating the quality of the Balance Sheet and asset backing available to both equity and debt investors.

Trading and Operational Summary

As much as it may sound trivial, 2020 really was a year of four very distinct quarters. In order to give sufficient detail, it seems reasonable to discuss both trading and operational aspects side-by-side on a quarter-by-quarter basis. Our response to COVID-19 is covered in detail below and will not be reviewed here. Additional information in the form of data is also available in the Business Review section, supplementing this narrative.

The first quarter of the year started fully in line with expectations. Trading across all platforms started well with a strong month of January at the PPG Platform and a slightly slower start at Ronez. CDH and G.D. Harries performed as expected putting the business on track for the delivery of analyst expectations issued in 2019. Operationally all platforms started the year as expected delivering budgeted volumes. PPG being slightly more seasonal, weather and major project driven would see its volumes rise from an expected softer start in January to more normal run rates in March. No specific impact from COVID-19 or lockdowns would be felt in the first quarter.

As we started the second quarter the situation changed dramatically. The lockdowns affecting each of the regions we are operating in inferred significant volume drops. These drops were in some cases more than 60% of budgeted volumes. We had made the decision to remain open across all sites and put in place our COVID-19 plans allowing us to do so. Scenarios prepared in the months earlier on cash burn, cost reductions, shift reductions and of course all protocols allowing us to operate safely were put into action. As demand dropped further significant concern arose in relation to paying bills and getting paid. Reinforcing the messaging to customers and suppliers that it was our mission to help our local economies by remaining active, paying our bills and delivering product, was well received and any cashflow concerns subsided.

April then provided a further blow as strict virus reduction policies in Guernsey and Jersey meant complete shutdowns of our activities. Luckily those measures were limited in time and progressive relaxation in these measures allowed for a gradual return to work. Across other platforms, those customers who had initially decided to shut down were returning to work leading to increased volumes. Entering into May and June, the recovery gathered further pace. Our volumes returned to pre-COVID levels as did turnover.

At this point it is interesting to give some context on operational gearing across the Group. As volumes dropped in April, we started to calculate our cash burn and estimate our effective cost base. With cash levels over £10 million across the Group we could sustain multiple months of near nil revenue. However, our cost base had shown sufficient flexibility without making specific use of COVID-19 related Government aid packages. As a result, we were able to remain EBITDA positive for the month of April. This is a great indication that our effective operational gearing is low.

The third quarter presented a much more normalised picture across the Group. While sales were impacted by sector summer shutdowns in the Benelux region, overall trading volumes returned to normal levels. Our ability to service customers and have sufficient stock on the ground at our various sites helped in delivering a solid performance. Operationally, the picture also returned to a more normal situation, with most work shifts and personnel returning.

The fourth quarter on the other hand had remained an enigma to us across the summer months. It was not obvious from the indications received through our customer networks what trading would look like. In part a lack of visibility in terms of orderbooks contributed to this uncertainty. The quarter did, however, turn out in line with normal trading, allowing for small exceptions. Relatively mild weather conditions helped, as well as a slower than expected return of lockdowns.

The narrative provided above is somewhat more lengthy than usual, however, given the extraordinary year, I wished to present you with additional context. A key take-away of last year's performance must be the flexibility and agility with which the business responded to the changes in the trading environment. We prepared early for the possibility of a lockdown and its consequences. All scenarios detailing cash burn, cost reductions, shift reductions, possible closures and other considerations had been prepared. However, the agility with which each platform responded to changing trading conditions on a daily basis is what made the difference. Our Group has great teams in each platform, who were able to make maximal use of our decentralised operating model.

COVID-19 Update

On Monday, 24 March 2020, having consulted with the various Managing Directors, General Managers and staff, we decided to remain open throughout the lockdowns in Belgium, the UK and the Channel Islands. This decision was not an easy one, but one supported by the various management teams and representatives of staff. It was taken in the knowledge that we had prepared the business during the month of March for the scenario of a lockdown and were able to keep staff sufficiently distanced, in open air facilities or in sufficiently sanitised offices in order to minimise the risk of COVID-19 contagion within the Group.

At 31 December 2020, we had 34 people self-isolating on a workforce of nearly 1,000 people. One person was taken to hospital. We also confirmed that to our best knowledge the virus did not spread within the Group, having traced all positive cases to contamination outside work. Of this record we are proud, but realise that as time goes by, the probability of encountering more positive COVID-19 cases increases.

Starting the year 2021 we continued our vigilance, reinforcing our COVID-19 protocols including working from home where possible, sanitising workspaces, wearing masks when working in less ventilated spaces or offices and a renewed push to make people aware of the risk. At the time of writing, we have 1 person self-isolating.

Operationally, the lock downs of 2021 have not had the same impact as the lockdown of spring 2020. The UK government issued a renewed letter urging the construction sector to remain active during this lockdown period with similar albeit less formal messages of support in Belgium and the Channel Islands. As a consequence, all sites remain active with production at acceptable levels for the time of the year.

Growth and development

Development:

With all its complexities and the unknowns, we kept our focus throughout the year on the continued development of the Group. First and foremost was the acquisition of the second tranche of G.D. Harries thereby forming a new fourth platform in South Wales. G.D. Harries is an excellent business with a strong market position in South Wales, a solid asset base including 7 quarries, 80 million tonnes of reserves and resources and several concrete and asphalt plants.

The main attraction of the acquisition of G.D. Harries is its potential to form the starting point of a new platform in South West Wales. The business was built over many decades by Ian Harries and his father before him. It delivered a solid performance in 2019 with revenue of £27.2 million and Underlying EBITDA of £3.2 million. While 2020 was a challenging year for Wales in general, G.D. Harries delivered Underlying EBITDA of £3.0 million on £26.7 million revenue. This performance is in line with our expectations and further validates the acquisition rationale.

Further development work was undertaken in Belgium where we closed off two major chapters in the extension of Carrieres du Hainaut. Having received the required zoning changes in August 2019, the quarry was awaiting confirmation of approval to move a road that crosses its current extraction zone. The Walloon regional government granted this permission and agreed to contribute €700k to the envisaged cost of the project. Additionally, we closed as planned the purchase of further land adjacent to the current extraction zone for circa £1.8 million, thereby finalising a long project lasting nearly a decade during which over 100 parcels of land were bought or exchanged in order to secure the future of the activities at Carrieres du Hainaut for generations. The local management team at Carrieres du Hainaut was key in this success, as was the support of the local and regional governments.

In the rest of UK our development activities were somewhat more limited and consisted primarily in the extension of our existing sites, and the renovation of these sites with the aim to increase our production capacity, safety records and product offering. In particular, Poundfield and CCP were the focus of these efforts as was the creation of an improved South London sales depot for Allen Concrete.

Debt refinancing:

A key project this year was the refinancing of our Group Credit Facilities. With the acquisition of CDH at the end of 2019 we acquired their existing credit facilities supplied by four leading Belgian banks. As these facilities were at the end of their life and as it made more practical sense to agree a Group wide facility, simplifying cash management and reducing overall financing cost, we launched a debt refinancing project early in the year.

After an initial suspension of this project in March due to COVID-19 and lockdowns, we were pleased to announce an expanded £125 million multi-currency credit facility including a £40 million uncommitted accordion facility supplied by a consortium of high-quality UK and European banks led by Santander. With adjusted leverage ratio covenant commencing at 3.5 times Underlying EBITDA, the facility has a term of 5 years of which 2 are non-amortising and a margin rate of 2.5% over LIBOR at an effective 2 times leverage ratio. These terms are an improvement on the facilities we had in place and allow us to further develop the business, while keeping our overall leverage at 2 times Underlying EBITDA or less.

Equity raise:

A second key project undertaken at the end of last year was the equity raise using the 10% special authorities obtained at the 2020 AGM. The equity raise of £12.4 million puts the Group in a great position to take advantage of a series of opportunities, both organic and through acquisition, identified across this past year. We have indeed already started to deploy the capital raised with further detail given in the post period section below.

Safety

Continued focus was put on health and safety this year, with a much broader scope than in normal years. Naturally we put in place all Government guidelines in relation to COVID-19. For those working from home we issued further guidelines and support to aid in the transition to remote working. As a result of these measures, we have been able to limit the spread of COVID-19 in the business and keep the number of infected people low.

While the challenges to operate safely increased as a consequence of social distancing and other restrictions, we were able to make further progress on safety this year. Our LTIFR dropped [2 2% ] as did our TIFR by [ 6% ]. Incidents decreased in part due to new systems put in place to track, report and investigate all safety incidents. A dedicated safety report in the Sustainability section of this Annual Report will provide further context.

Sustainability

A dedicated Sustainability section is included in the Annual Report and I will limit the review in this section to several highlights. As announced last year we have now formalised our Sustainability initiatives in line with market best practice and as a result of this, we are now able to better report on the initiatives we take and their impact.

Environmental

In 2019, we presented a first series of initiatives in our annual report dedicated to the improvement of our environmental impact, carbon footprint and product portfolio. Included in this year's report is a full review of our carbon footprint. I am therefore happy to report we have been able to progress on several initiatives reducing our carbon footprint across the Group.

We have made a first significant step in the direction of offering ultra-low carbon alternatives to every concrete product we produce. In January 2021 we launched the production of our Greenbloc product line with the launch of the ultra-low carbon solid dense concrete block. We also launched a collaboration with Airlite, a manufacturer of CO₂, SO_x and NO_x absorbing coatings, which we are applying to several of our concrete products. Further innovations are detailed in the Sustainability section as we improve our footprint.

We were also able to make further progress in increasing our electricity sourced from renewable sources through the installation of the third phase of our photovoltaic park. Once fully operational it will increase our electricity generated renewably and on site, to 30% of our total electricity consumption. In addition to this we continue to pump filter and supply fresh drinking water to the water system in Belgium.

Further initiatives were undertaken to improve the environmental impact of our operations through continuous site improvement plans, engagement with local communities as well as programmes to promote flora and fauna around our sites.

Social

On a Social front several initiatives were launched which are detailed in the Sustainability report. One highlight is in Belgium, where we have gifted to the city of Soignies an area of land of 10 hect ares adjacent to the quarry. The area forms a large protective hill, onto which trees were planted. It is the aim of the council to develop the area into a park or nature walk from which our operations can be viewed. We have had a lot of success with a similar project in Guernsey and will assist the council.

In other areas of the business, we have endeavoured to engage more closely with the local communities to ensure a better dialogue exists. As part of these initiatives, events were organised at some of our operations where COVID-19 restrictions permitted.

Governance

From a governance perspective, 2020 was a year of significant change and improvement for the Group. The Governance report will provide ample more detail. Firstly, our Board saw profound change with the joining of several independent and highly skilled directors. The entire corporate governance code was reviewed as well as the Articles in order to align both to London Stock Exchange and QCA best practices. We appointed a very experienced corporate lawyer as our General Counsel to further improve our compliance and created additional Board committees covering the various listing requirements or recommendations.

Statement by the directors in performance of their statutory duties in accordance with s172(1) of the Companies Act 2006

The Director's believe they have acted in the way most likely to promote the success of the Group for the benefit of its members as a whole, as required by s712 of the Companies Act 2006. The requirements of s172 are for the Directors to:

· Consider the likely consequences of any decision in the long term;

· Act fairly between the members of the Company;

· Maintain a reputation for high standards of business conduct;

· Consider the interests of the Group's employees;

· Foster the Group's relationships with suppliers, customers and others; and

· Consider the impact of the Group's operations on the community and environment.

The application of the s172 requirements are demonstrated throughout this report and the Accounts as a whole, with the following examples representing some of the key decisions made in 2020 and up to the date of these Accounts:

· Response to the Coronavirus pandemic: the Group has taken various measures to protect the wellbeing of its employees, maintain good working relationships with its customers and suppliers, and ensure the commercial viability of its business.

· Continued pursuit of buy and build growth strategy: the Group has aggressively continued its buy and build growth strategy, completing two acquisitions during 2020, which expanded the South Wales and Benelux platforms.

· Safety initiatives: safety and wellbeing of our colleagues is one of our top priorities and the Group continued to improve its health and safety standards, including implementing a Group wide health and safety reporting tool.

Post-period announcements

In the second half of 2020, we started to look forward to 2021 and what we could realise in the new year. Plans were made to both improve our business further and continue its expansion. To be in a good position to attack 2021, in December 2020, we raised some additional funding, with the intention to deploy it rapidly in the new year.

We were therefore happy we could make good on these promised within the first quarter of 2021. A separate section is dedicated to the three key transactions and projects we completed, the first being the introduction of Greenbloc. With the launch of our cement free concrete building block we set a new benchmark for the industry by being the first company in the UK to do so. The reduction in embodied CO₂ is significant and as the product gets more widely adopted this reduction will have its impact on the sustainability of construction in the UK as a whole.

We subsequently announced an important transaction in Belgium where we reached a mutually beneficial deal with LafargeHolcim at our Carrieres du Hainaut operations. Taking over all crushing and screening plant from LafargeHolcim and entering into a take-or-pay agreement with them, we put ourselves in a great position to prepare our entry into the Belgian aggregates market as a large scale supplier. In the meantime, we benefit from the additional EBITDA generated from the plant while not having spent any further capital to generate these returns.

We then turned our eye to establishing our footprint more widely in the Belgian market with the acquisition of B-mix Beton and Casters Beton, two large scale suppliers of concrete in the Limburg area. As a consequence of this, we are gradually expanding our footprint in order to become a significant operator in the Benelux region.

Strategic approach and outlook

It is evident the drive and determination of our teams remains high to deliver excellent results and exciting new opportunities for the business to expand and grow further. The strategy of local focus through platforms which are agile and close to the end customer remains robust and has shown its value during the difficult times of this past year. The outlook therefore remains positive and above all exciting.

With your continued support, for which we are grateful and which we never take for granted, we can continue to Invest, Improve, Integrate and Innovate to the benefit of our shareholders and our stakeholders.

This report was approved by the Board on 12 April 2021.

Max Vermorken

Chief Executive Officer

CHIEF FINANCIAL OFFICER'S REPORT

Following my first year as an executive Board member and Chief Financial Officer, having taken over from Garth Palmer in 2020, I would like to begin this report by thanking the Board and shareholders for the opportunity.

I am very pleased to report a strong year financially for the Group, during which we exceeded our ambitious financial targets, while continuing to expand our business during a global pandemic crisis. We completed the acquisition of the remaining parts of Stone Holdings and G.D. Harries as well as a full debt refinancing.

In our full 2020 financial year, the Group generated revenue of £ 124.2 million (2019: £70.4 million) and Underlying EBITDA of £23.9 million (2019: £14.5 million). The Underlying profit before taxation for the Group for the year ended 31 December 2020 was £12.2 million (2019: £8.4 million).

The loss for the Company for the year ended 31 December 2020 before taxation amounts to £5.8 million (2019: loss £4.7 million), which includes £2 million of non-underlying expenses.

The Board monitors the activities and performance of the Group on a regular basis. The Board uses financial indicators based on budget versus actual to assess the performance of the Group. The indicators set out below will continue to be used by the Board to assess performance over the period to 31 December 2021.

	2020	2019
Cash and cash equivalents	£27,451,984	£9,867,696
Revenue	£124,231,115	£70,362,472
Underlying EBITDA	£23,896,126	£14,534,647
Capital expenditure	£6,451,893	£3,384,363

Cash generated from operations was £ 28.5 million (2019: £2.1 million) with a net increase in cash of £17.5 million (2019: net increase of £6.1 million). In December 2020, the Group raised, in aggregate, £12.4 million in relation to future acquisitions.

Revenue and underlying EBITDA exceeded expectations and management forecasts.

Capital expenditure relates to purchase of new plant and machinery and improvements to existing infrastructure across the Group.

PPA

BDO UK undertook the PPA exercise required under IFRS 3 to allocate a fair value to the acquired assets of CDH.

The PPA process resulted in a reduction of goodwill recorded on the Statement of Financial Position of the Group for CDH from £51 million to £7.2 million. The reduction was to transfer the value of goodwill to tangible assets for land and buildings, land and mineral reserves, intangible assets for trade name and deferred tax assets.

Non-underlying items

The Company's loss after taxation for 2020 amounts to £5.8 million, of which £2 million relates to non-underlying items, while the Group's non-underlying items totaled £5 million for the year. These items relate to eight categories:

1. £1.4 million amortisation of acquired assets and adjustments to acquired assets

2. £1.4 million in exclusivity, introducer, consulting, legal fees and other direct costs relating to acquisitions. During the year the Group acquired the remaining shares in G.D. Harries and Stone Holdings.

3. £0.8 million legal and restructuring expenses relating to the rebranding and alignment of all subsidiaries across the Group.

4. £0.3 million in share based payments relating to grants of options.

5. £0.3 million on unwinding of discounts on deferred consideration payments for CDH and CCP.

6. £0.6 million in other exceptional costs which primarily relate to non-cash balance sheet adjustments and COVID-19 costs

7. £0.1 million in discontinued operations including the trading expenses, stock adjustments and redundancies incurred at the Bury site for the 2020FY.

8. £0.1 million for provision of legal fees.

Interest and tax

Net finance costs in the year totaled £2.7 million (2019: £2.0 million) including associated interest, bank finance facilities, as well as interest on finance leases (including IFRS 16 adjustments), hire purchase agreements and non-cash adjustment for unwinding of discounts on deferred consideration payments for CDH and CCP.

A tax charge of £ 0.7 million (2019: £0.5 million) was recognised in the year, resulting in a tax charge on profitability generated from mineral extraction in the Channel Islands and profits generated through the Group's UK and Belgium based operations.

Earnings per share

Basic EPS for the year was 2.55 pence (2019: 0.92 pence), adjusted for the non-underlying items mentioned above. Underlying basic EPS for the year totaled 4.50 pence (2019: 4.20 pence).

Statement of financial position

Net assets at 31 December 2020 were £ 124 million (2019: £102 million). Net assets are underpinned by mineral resources, land & buildings and plant & machinery assets of the Group.

Cash flow

Cash generated by operations was £28. 5 million (2019: £2.1 million). The Group spent £8.4 million on acquisitions net of cash acquired and £6.5 million on capital projects. The Group raised £12.0 million net of fees through the issue of equity and repaid net borrowings of £6.4 million. The net result was a cash inflow for the year of £17.5 million.

Net debt

Net debt at 31 December 2020 was £43.8 million (2019: £49.8 million), and was refinanced on 21 December 2020.

Bank facilities

In December 2020, the Company entered a new Syndicated Senior Credit Facility of up to £125 million (the 'Credit Facility') led by Santander UK and including several major UK and European banks. The Credit Facility, which comprises an £85 million committed term facility and a £40 million accordion option, will provide the Group with further capacity and flexibility to support its ongoing buy-and-build strategy, as well as reducing like-for-like borrowing costs.

The Group's new Debt Facilities have a maturity date of 21 December 2025 and are subject to a variable interest rate based on LIBOR plus a margin depending on EBITDA. As at 31 December 2020, total undrawn facilities available to the Group via the new Debt Facilities amounted to £63.7 million.

The Group's new Debt Facilities are subject to covenants which are tested monthly and certified quarterly. These covenants are:

· Group interest cover ratio set at a minimum of 3.5 times EBITDA; and

· A maximum adjusted leverage ratio, which is the ratio of total net debt, including further borrowings such as deferred consideration, to adjusted EBITDA, of 3.5x in 2020. As at 31 December 2020, the Group comfortably complied with its bank facility covenants.

Capital Allocations

We prioritise the maintenance of a strong balance sheet and deploy our capital responsibly, allowing us to commit significant organic investment to our business whilst continuing to pursue acquisitions to accelerate our strategic development. This conservative approach to financial management will enable us to continue pursuing capital growth for our shareholders.

Dividends

Subject to availability of distributable reserves, dividends will be paid to shareholders when the Directors believe it is appropriate and prudent to do so. The focus of the Group at this stage of its development will be on delivering capital growth for shareholders. The Directors therefore do not recommend the payment of a dividend for the year (31 December 2019: nil).

Post Balance Sheet event

Post 2020 close we have conducted a series of activities worthy of mention in this annual report:

Employee Benefits

All of our UK employees, almost 400, have been offered both Private Medical Insurance and Group Life Assurance. Our benefits provider commented that the uptake of this offering from our employees was unprecedented with many adding family members.

SigmaRoc has also engaged Link Group to set up a Share Incentive Plan for all UK employees, an offering we already have in the Channel Islands. We are continuing to investigate Share Plans for our European operations.

This report was approved by the Board on 12 April 2021 and signed on its behalf .

Dean Masefield

Chief Financial Officer

SUSTAINABILITY REPORT

SigmaRoc is committed to sustainability and disclosure and going forward will have a dedicated section in the annual report on sustainability. With sustainability being such a key subject, we have committed to a sustainability framework relevant to our size and industry following review of global frameworks such as TCFD, SASB and FTSE Russell, of which themselves align to the UN Sustainable Development Goals.

1. Environment

SigmaRoc looks to follow four key statements with regards to our commitment to environmental responsibility:

1. Sustainable use of reserves and resources;

2. Responsible use of key resources including raw material, mineral and water;

3. Optimise energy use and minimise impact of our operations on the environment; and

4. Contribute to sustainable construction and address environmental aspects either through production or consumption.

2020 continued to be a very focused year with several areas delivering or creating the foundation to deliver some inspirational opportunities:

1.1 Biodiversity

As our extractive operations continue, areas that have been long since mined have been nurtured overtime. This year, we were proud to be able to give a large restored part of a previously working site back to the community, where walking and cycling trails can be set up for the local communities to enjoy. We have also conducted land swaps where areas of our ownership have been swapped with local farmers, thereby allowing them more land whilst in return giving us better access to mineral with less environmental impact. We have also participated in smaller projects with more remote communities such as the planting of over 1,000 trees and the successful translocation of blue grass following ongoing operations at one of our sites.

1.2 Climate Change

This will be our first year of SECR reporting and whilst this is limited to the UK, in the interests of full disclosure, we have voluntarily exceeded the minimum requirements set out in the 2018 Regulations by also including energy use and greenhouse gas emissions for operations outside of the UK. Further SECR details can be found in the next section.

Over the year we have continued to embrace technology; this includes energy sourcing, consumption and energy management.

Energy Sourcing

Continuing our commitment to renewable energy where possible, we have signed the contract for the third phase of the solar photovoltaic extension, to be installed in 2021, increasing energy generation from 950MWh to 3,800MWh. We continue to look at alternative energy options across our other sites and have been in discussions with various energy suppliers for the installation of solar farms to feed our plants with surplus being added to the grid.

Energy use

With regards to energy use, we have continued to extend our change over to LED lighting, and have successfully completed more sites, with others still transitioning. We have also extended our focus on energy to our mobile plant, with several aging machines being upgraded to more fuel-efficient models, and one of our primary haulage contractors upgrading their fleet to Euro 6 HGV. As we have shown commitment, so have our employees, with several identifying the UK Government backed cycle scheme which we have supported.

Energy monitoring

To ensure we are not using fuel unnecessarily we have also continued to roll out MachineMax that allows monitoring and management of our assets thereby reducing idle times and unnecessary operation.

1.2.1 Pollution and resources

We regularly review our production processes to minimise resource use and waste generation. This year has included ensuring where we do not already harvest rain water, we do so, thereby reducing the impact on water tables or potable water supply. In Belgium this has been taken one step further by [ensuring] a closed circuit which includes the supply of 40,000 families in the local community.

Where waste does occur, we continue to have dedicated recycling functions and actively look to reuse it by feeding waste material back into our process.

In addition to our own waste, we also review other industries' waste usage to see what opportunities exist, such as for substitution in full or part of raw materials to minimise environmental impact. This includes working in conjunction with Natural UK to replace the use of conventional fibres in asphalt to using recycled, clean nappies from local recycling facilities.

Contribution to sustainable products and uses

In 2020, we developed GreenBloc, a cement free block that reduces the CO₂ footprint of a traditional block by up to 77%. Further to this we also looked at our products to see how they themselves can reduce pollution and improve the environment. Through research and working in close partnerships with others, we are working with product ranges that not only offset aspects such as carbon, but also remove pollutions such as CO₂, NOx and SOx.

Further information on our policies such as (biodiversity, environment, and pollution) can be found at www.sigmaroc.com .

1.3 Streamlined Energy and Carbon Reporting (SECR)

Energy use and associated greenhouse gas emissions

SigmaRoc is pleased to report its 2020 annual energy consumption and associated annual greenhouse gas emissions pursuant to the 2018 Regulations.

Organisational boundary

In the interests of full disclosure, SigmaRoc has voluntarily exceeded the minimum requirements set out in the 2018 Regulations by also including energy use and greenhouse gas emissions for operations outside of the UK. Therefore, energy use and emissions are reported for assets and operations in the UK, the Channel Islands and Belgium, covering the entire Group as defined by the operational control approach.

Reporting period

The annual reporting period is 1 January to 31 December each year and the energy and carbon emissions are aligned to this period. G.D. Harries was fully acquired on 21 September 2020, meaning energy and emissions are only included for this subsidiary from the date of full control as per the operational control approach.

Quantification and reporting methodology

The 2019 UK Government Environmental Reporting Guidelines and the GHG Protocol Corporate Accounting and Reporting Standard (revised edition) were followed. The 2020 UK Government GHG Conversion Factors for Company Reporting were used in the majority of emission calculations with the exception of electricity emission factors for Belgium, Jersey and Guernsey. These 'location-based' factors were sourced from the Association of Issuing Bodies, Jersey Electricity and Guernsey Electricity respectively and exclude transmission and distribution losses. The report has been reviewed independently by Briar Consulting Engineers Limited.

Electricity and gas consumption records were based on invoices, with some pro-rata and benchmark estimations carried out to complete missing data. Transport emissions were calculated from a combination of mileage and fuel records. Fuel used for off-highway fleet vehicles were reported separately from fuel used for other stationary machinery where possible. Gross calorific values were used except for mileage energy calculations as per Government GHG Conversion Factors.

The associated emissions are divided into mandatory and voluntary emissions according to the 2018 Regulations. For large unquoted organisations, the 2018 Regulations define mandatory emissions as purchased electricity, gas combustion and transport fuel purchased by the organisation (including company cars, off-highway fleet and expense claims for business mileage in personal or hire cars). Reporting energy and emission sources outside of these sources is considered voluntary and reported separately.

The emissions are further divided into their relevant scopes as per the GHG Protocol. The scopes are defined as:

· Scope 1: Direct GHG emissions that occur from sources owned or controlled by the organisation.

· Scope 2: Indirect GHG emissions from the generation of acquired and consumed electricity, steam, heating or cooling.

· Scope 3: Other indirect GHG emissions that occur as a consequence of the organisations activities but occur from sources not owned or controlled by the organisation.

Breakdown of energy consumption used to calculate emissions (kWh):

Energy type	2020
Mandatory energy:	United Kingdom	Channel Islands	Belgium	Total
Gas	274,854	-	441,790	716,644
Purchased electricity	2,611,414	2,398,867	12,261,484	17,271,765
Transport (including off-highway fleet)	6,274,566	1,793,945	18,708,177	26,776,689
Total mandatory energy consumed	9,160,834	4,192,812	31,411,451	44,765,098
Voluntary energy:
Gas oil (for stationary machinery)	12,704,112	14,123,496	4,752,326	31,579,934
Burning oil	5,077,170	-	714,895	5,792,065
Generated electricity¹(solar photovoltaic)	-	-	940,490	940,490
Total voluntary energy consumed	17,781,282	14,123,496	6,407,711	38,312,489
Total mandatory & voluntary energy consumed	26,942,117	18,316,308	37,819,162	83,077,587

¹ Solar photovoltaic electricity generated includes any exported energy to the grid

Breakdown of emissions associated with the reported energy use (tCO ₂ e)

Emission source	2020
Mandatory emissions:	United Kingdom	Channel Islands	Belgium	Total
Scope 1
Gas	50.5	-	94.8	145.3
Transport - Company owned fleet	1,471.6	431.6	4,784.9	6,688.1
Scope 2
Purchased electricity (location-based)	608.8	368.7	1,877.6	2,855.1
Scope 3
Transport - Business travel in employee-owned vehicles	41.5	-	-	41.5
Total gross mandatory emissions	2,172.4	800.2	6,757.3	9,730.0
Voluntary emissions:
Scope 1
Gas oil	3,261.5	3,625.9	1,220.0	8,107.4
Burning oil	1,252.4	-	176.3	1,428.7
Generated electricity consumed on site	-	-	-	-
Total gross voluntary emissions	4,513.9	3,625.9	1,396.3	9,536.1
Total gross mandatory & voluntary emissions	6,686.3	4,426.1	8,153.7	19,266.1
Intensity ratios: tCO₂e per £million turnover
Mandatory emissions only	46.4	29.3	134.9	78.3
Mandatory & voluntary emissions	142.9	162.1	162.7	155.1

Intensity ratio

The intensity ratio is total gross emissions in metric tonnes CO₂ equivalent per total million-pound (£m) turnover. This is calculated separately for 'mandatory' emissions and 'mandatory & voluntary' emissions for the UK, Channel Islands and Belgium. This financial metric is considered the most relevant to the company's energy consuming activities and provides a good comparison of performance over time and across different organisations and sectors.

Energy efficiency action during current financial year

In the period 1 January to 31 December 2020 for UK operations, no specific energy efficiency actions were undertaken; however, in Belgium we have signed the contract for the third phase of the solar photovoltaic extension to be installed in 2021. This is set to increase energy generation from 950MWh to 3,800MWh.

2. Social

SigmaRoc looks to follow four key statements with regards to our commitment to social responsibility:

· Ensure people leave work in the same or better condition than when they arrived;

· Support the physical and mental health of our employees and their families;

· Attract, train, retain, and engage our workforce; and

· Be a good neighbour: Source local, buy local, sell local, invest local.

Two key areas in 2020 following significant growth at the end of 2019 were:

2.1 Health and Safety

November 2019 saw the re-issue of the group Health & Safety policy and framework, and during 2020 all then supervisor and managers put through IOSH and or NEBOSH training to support them and their commitment to the new Health & Safety policy and framework

In the spirit of a reset, we also took the opportunity to conduct a health and safety benchmark review by conducting full external audit of all our sites during 2020. We are proud to say that internal follow up has shown many actions and focal areas have been addressed and good work is on-going with those still remaining.

We can take comfort in that our overall incident rate has reduced by 6% and that our LTIFR has reduced again this year by 22% and that one of our businesses was one of the first in our industry to achieve the new ISO 45001. During 2021, at least 2 other businesses should achieve ISO 45001, subject to any ongoing travel restrictions.

Health and safety engagement has seen positive trends both locally with local management teams engage with worker representatives, unions and local government and across the groups with the introduction of HighVizz, a mobile engagement and safety management system, as well as monthly cross business safety meetings and the Group safety committee.

The Group safety committee is chaired by our CEO, Max Vermorken and as of 2021 will be joined by Non-Executive Director Tim Hall. The committee:

· Reviews and agrees the framework and policy for Health, Safety and Wellbeing across the Group annually

· Determines each year Group focus areas and performance targets

· Monitors integrity of information and overall Group performance biannually

· Monitors progress and performance against audits and plans

· Reviews and challenges health and safety process and procedures across the Group

· Reviews and promotes engaging and proactive health, safety and wellbeing culture and focus

During a time of unprecedented global pandemic, we have leveraged our various programs such as Employee Assistance Programs, cash plans with access to medical and counselling services, buddy systems that allow peers to call each other even if it is to just say "hi, how you doing" and Rehabilitation programs that allow people to be returned to work, regardless if they are hurt at home or not to ensure that not only are our staff's physical and mental health proactively supported, but also their loved ones at home.

As of 2020, we have engaged programs to review our entire employee benefits such as life assurance and healthcare to expand out offering throughout the businesses and through 2021 we remain committed to continuing to improve the health, mental wellbeing and safety of our staff, contractors and visitors.

Helping with safety beyond ourselves

Our approach to health and safety extends beyond our own walls; by engaging our communities, we can help minimise health and safety matters with regards to visitors, contractors and customers coming on to our sites. After serving the maximum nine year term as a voluntary Board member of the Jersey Safety Council, Mike Osborne stood down during 2020 with Kirsten du Heaume being elected independently to serve on the council, keeping Ronez at the front of the behavioural safety agenda in Jersey. In Guernsey we are proud to have Seamus Gillespie as a committee member of Guernsey Occupational Safety and Health Association

2.1.1 Employee and Communities Engagement

As we have grown and our presence and reputation has become stronger, ensuring we have the right people has been an important focus during 2020. It has been essential that we attract and recruit the best candidates for our jobs by focusing on their overall potential both in terms of technical capability but equally importantly in terms of their soft skills. By offering autonomy within our businesses, each employee can not only become part of the business, but they can help the business become part of the community. By being locally focused, each business can focus on what is important to their communities, be it support with local schools, sports teams or charities.

Retaining & Attracting

This year we have seen many of our staff achieve service levels that are a testament to the culture we look to have and retain in our businesses; a working environment where people feel part of a family. Across a business of close to 1,000 employees 32% have dedicated 15 years to our businesses.

As proud as it is to have such long serving members of staff, we have also focused on ensuring that those at the very start of their working lives have the opportunity to become long serving members of the team. This starts at the very beginning, even before people are job hunting and are in school looking at career directions.

Across our businesses we have engaged with; over 25 trainees and apprentices; informal and formal work experience such as Project Trident providing work experience for school students under the mentorship of technical and operational staff; and cooperation with Universities and industrial training centers in the UK, Europe and America.

At the end of the year, nearly all of our workforce are directly employed by our businesses with almost 80% working in operational and manufacturing roles.

Working with local companies when help is needed

Our local presence and commitment led us to become aware of, engage with, and help support approximately 50 people facing redundancy in unprecedent times for a high-profile project who otherwise would have been made redundant. Since the end of the project, we have retained people and helped others with finding jobs elsewhere.

Supporting our communities and committing to our industry

This year we have seen our support take many forms from supporting local charities, be it fundraising, material or services, to our teams volunteering their time, knowledge and skills.

It is our industry and our people that have led us to be where we are today, and it is testimony to our employees that they want to continue to support where they have come from, often volunteering time outside of normal working hours; Industry working parties, Board member of national industrial federations, director and committee roles of business councils and associations as well as offering educational commitments ranging from schools to universities.

Further information on our policies can be found at www.sigmaroc.com.

3. Governance

SigmaRoc looks to follow four key statements with regards to our commitment to governance:

1. Promote QCA and Corporate Governance Codes;

2. Ensure proactive Board oversight and independence of committees;

3. Focus on risk management & mitigation (including cyber) and conversion of risk into generation of opportunity; and

4. Ensure transparency and disclosure on both reporting and tax.

Following significant growth at the end of 2019, in 2020 heavy emphasis has been placed on three main areas:

Corporate governance

We appointed two independent non-executive directors, including new independent chairs for the audit, remuneration and nominations committees, and a highly qualified inhouse general counsel, with a specialty in ECM.

Anthony Brockbank, our General Counsel, is a qualified solicitor specialising in Corporate Finance, M&A and Equity Capital Markets. Anthony has previously worked for Fieldfisher, Hobson Audley and Linklaters and has over 30 years' experience in mergers and acquisitions, flotations and fundraisings with particular expertise in small and mid-size public company transactions on the Official List and AIM Market of the London Stock Exchange. Anthony is ranked by Chambers in Band 1 for capital markets work and as a leading individual in Legal 500.

This has already led to a full review of all existing corporate governance handbook and going forward will ensure not only our compliance with the QCA Corporate Governance Code but alignment with best practice wherever possible.

In addition to the formal boards and committees, we have also engaged an independent advisory board in Belgium, consisting of Emmanuel Maes (former CEO DeCloedt), Pascal Lesoinne (former CEO Heidelberg Belgium), Christophe de Limburg Stirum (Investor and entrepreneur specialising in Industrial companies) and Patrick Dolberg (former CEO Holcim Europe). The function of this board is to ensure that within Belgium and Europe we have a governance structure that can work on a local level where there are jurisdictional differences .

Risk Management

This year we adopted a risk management framework. In the current business climate, where remote working and communication has become essential, we have also reviewed our cyber protection with both insurance policies in place as well as cyber risk management software that allow for testing and training of cyber security. In addition, through our service providers, security checks are performed on a regular basis both at Group and subsidiary level.

Transparency

Engagement of a full time CFO to ensure adequate time was dedicated to ensuring accurate and transparent reporting as well as overall compliance. This has included the separation of our tax and audit partners as well as the appointment of a training provider on Criminal Finances Act 2017 that is due to be undertaken in early 2021.

We continue to maintain our policies such as Anti Bribery & Corruption, which is overseen by the Board and trained annually and cascaded throughout the business, as well as our Whistleblowing policy. The Whistleblowing policy gives its employees, or indeed any other third party, the means to raise concerns in confidence and (if they wish) anonymously. The Audit Committee reviews reports on notifications received and ensures that arrangements are in place for the proportionate and independent investigation of such matters and for follow up action.

We are also committed to having transparency with all of our Shareholders and as per last annual reports and interim reports we will continue to give a presentation webinar to all Shareholders with an online or moderated Q&A session.

Further information on our policies can be found at www.sigmaroc.com .

4. Sustainability Roadmap

Development

In 2020 we committed to define SigmaRoc's framework following review of international and industry standards. We have agreed commitment statements have have already started work and disclosure on various aspects, including safety and CO₂ emissions and launch of sustainable products such as GreenBloc. Through ongoing engagement with investors we continue to identify areas of focus and disclosure.

Measure

2020 was our first year of collating information for SECR. We will continue to set up practical and meaningful measuring processes to help determine more relevant and quantifiable targets as well as our ongoing contribution to national industry bodies.

Analyse and Disclose

Having captured all practical and meaningful data, we can identify those areas of focus that will bring the biggest wins for the overall position and performance of the company. Short and long term targets will be able to be captured and disclosed

Improve

We will continue to monitor, disclose and drive continual improvement.

DIRECTORS' REPORT

The Directors present their report, together with the audited Financial Statements, for the year ended 31 December 2020.

Principal Activities

The principal activity of the Company is to make investments and/or acquire businesses and assets in the construction materials sector. The principal activity of the Group is the production of high quality aggregates and supply of value-added construction materials.

Board composition and head office

The Board comprises three Executive Directors and four Non-Executive Directors. The Corporate Head Office of the Company is located in London, UK .

Risk Management

The Board is responsible for the Group's risk management and continues to develop policies and procedures that reflect the nature and scale of the Group's business.

Details of the Group's financial risk management policies are set out in Note 3 to the Financial Statements.

Results and Dividends

For the year to 31 December 2020, the Group's Underlying profit before tax was £12.2 million (2019: £8.4 million) and Underlying profit after tax was £11.5 million (2019: £7.9 million). Recognising the Group's strategy, current position on its journey, the Directors are not proposing to adopt a dividend policy yet.

Stated Capital

Details of the Company's shares in issue are set out in note 28 to the Financial Statements.

Directors

The following Directors served during the year:

Director	Position	Note
David Barrett	Chairman
Max Vermorken	Chief Executive Officer
Dean Masefield	Chief Financial Officer	Appointed 20 April 2020
Garth Palmer	Non-Executive Director
Tim Hall	Non-Executive Director
Simon Chisholm	Independent Non-Executive Director	Appointed 20 April 2020
Jacques Emsens	Independent Non-Executive Director	Appointed 20 April 2020
Dominic Traynor	Non-Executive Director	Resigned 18 May 2020
Patrick Dolberg	Independent Non-Executive Director	Resigned 18 May 2020

Directors & Directors' interests

The Directors who served during the year ended 31 December 2020 are shown below and had, at that time, the following beneficial interests in the shares of the Company:

	31 December 2020		31 December 2019
	Ordinary Shares	Options	Ordinary Shares	Options
Max Vermorken	549,529	11,807,349	447,511	11,807,349
David Barrett	2,609,189	5,638,674	2,175,640	5,638,674
Dean Masefield¹	28,101	30,000	-	-
Garth Palmer	438,499	3,326,014	256,186	3,326,014
Tim Hall	329,176	750,000	300,000	750,000
Simon Chisholm²	-	-	-	-
Jacques Emsens³	-	-	-	-

(1) Appointed on 20 April 2020

(2) Appointed on 20 April 2020

(3) Appointed on 20 April 2020

Further details on options can be found in Note 29 to the Financial Statements.

Details on the remuneration of the Director's can be found in Note 10 to the Financial Statements.

Substantial Shareholdings

The Company is aware that, as at 18 March 2021, other than the Directors, the interests of Shareholders holding three per cent or more of the issued share capital of the Company were as shown in the table below :

Shareholder	Shares held	Percentage of holdings
M&G Investment Management	26,352,595	9.45%
BGF Investment Management Limited	21,792,872	7.82%
Ravenscroft	21,345,901	7.66%
Balliwick Investments	18,910,000	6.78%
Hermco Property Limited	18,502,502	6.64%
Chelverton Asset Management	17,952,460	6.44%
Slater Investments	14,582,422	5.23%
Janus Henderson Group plc	13,693,048	4.91%
Canaccord Genuity Wealth Management (Inst)	12,500,000	4.48%
Legal & General Investment Management	12,018,925	4.31%
Nigel Wray	10,580,048	3.80%

Employees

By being responsible for their own businesses, that are aligned with the overall Group's strategy, employees are fully aware of their impact and contribution as they are inherently responsible for their own success. The Group and each business is committed to employing the best they can, not only in skills and competence but also in their softer skills, regardless of who they are or where they have come from. Once engaged, each employee is nurtured and developed locally with opportunities within each business and platform offered openly.

Political Contribution

The Group did not make any contributions to political parties during either the current or the previous year.

Annual General Meeting

The AGM will be held at 56 Queen Anne Street, London, W1G 8LA on 19 May 2021 at 3.00 p.m. The formal notice convening the AGM, together with explanatory notes on the resolutions contained therein, is included in the separate circular accompanying this document and is available on the Company's website at www.sigmaroc.com.

Viability Statement

The directors have assessed the viability of the Group over a period to December 2022. This is the same period over which financial projections were prepared for the Group's strategic financial plan. In making their assessment the directors have taken into account the Group's current position and the potential impact of the principal risks and uncertainties set out on its business model, future performance, solvency or liquidity. They also stress tested their analysis by running a number of credible scenarios and considered the availability of mitigating actions. Based on this assessment, the directors confirm that they have a reasonable expectation that the Group will be able to continue in operation and meet its liabilities as they fall due over the period to December 2022. In making this statement, the directors have assumed that financing remains available and that mitigating actions are effective.

Corporate responsibility

Environmental

SigmaRoc undertakes its activities in a manner that minimises or eliminates negative environmental impacts and maximises positive impacts of an environmental nature.

Health and safety

SigmaRoc operates a comprehensive health and safety programme to ensure the wellness and security of its employees. The control and eventual elimination of all work related hazards requires a dedicated team effort involving the active participation of all employees. A comprehensive health and safety programme is the primary means for delivering best practices in health and safety management. This programme is regularly updated to incorporate employee suggestions, lessons learned from past incidents and new guidelines related to new projects, with the aim of identifying areas for further improvement of health and safety management. This results in continuous improvement of the health and safety programme. Employee involvement is regarded as fundamental in recognising and reporting unsafe conditions and avoiding events that may result in injuries and accidents.

Internal controls

The Board recognises the importance of both financial and non-financial controls and has reviewed the Group's control environment and any related shortfalls during the year. Since the Group was established, the Directors are satisfied that, given the current size and activities of the Group, adequate internal controls have been implemented. Whilst they are aware that no system can provide absolute assurance against material misstatement or loss, in light of the current activity and proposed future development of the Group, continuing reviews of internal controls will be undertaken to ensure that they are adequate and effective.

Going concern

The Group meets its day-to-day working capital and other funding requirements through cash and banking facilities; which were renewed in December 2020.

The impact of the COVID-19 pandemic on the Group's business, revenues and cash flow creates uncertainty. However, given the Group's robust balance sheet, solid performance through the COVID-19 pandemic to date and in conjunction with forecast projections, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future and, therefore, continue to adopt the going concern basis in preparing the Annual Report and Financial Statements. Further details on their assumptions and their conclusion thereon are included in the statement on going concern included in Note 2.3 to the Financial Statements.

Directors' and officers' indemnity insurance

The Company has made qualifying third-party indemnity provisions for the benefit of its Directors and officers. These were made during the year and remain in force at the date of this Annual Report.

Events after the reporting period

Events after the reporting period are set out in Note 38 to the Financial Statements.

Policy and practice on payment of creditors

The Group agrees terms and conditions for its business transactions with suppliers. Payment is then made in accordance with these terms, subject to the terms and conditions being met by the supplier. As at 31 December 2020, the Company had an average of 9 days (2019: 51 days) purchases outstanding in trade payables and the Group had an average of 74 days (2019: 82 days).

Provision of information to Auditor

So far as each of the Directors is aware at the time this report is approved:

· there is no relevant audit information of which the Group's auditor is unaware; and

· the Directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.

Auditor

PKF Littlejohn LLP has signified its willingness to continue in office as auditor.

This report was approved by the Board on 12 April 2021.

Dean Masefield

CONSOLIDATED INCOME STATEMENT

FOR THE YEAR ENDED 31 DECEMBER 2020

		Year ended 31 December 2020				Year ended 31 December 2019
		Underlying	Non-underlying (Note 11)	Total	Underlying		Non-underlying* (Note 11 )	Total
Continued operations	Note	£	£	£	£		£	£

Revenue	7	124,231,115	-	124,231,115	70,362,472		-	70,362,472

Cost of sales	8	(90,028,317)	-	(90,028,317)	(50,924,209)		-	(50,924,209)

Profit from operations		34,202,798	-	34,202,798	19,438,263		-	19,438,263

Administrative expenses	8	(20,045,509)	(4,554,557)	(24,600,066)	(9,922,199)		(4,953,675)	(14,875,874)
Net finance (expense)/income	12	(2,379,230)	(359,599)	(2,738,829)	(1,268,122)		(695,457)	(1,963,579)
Other net gains / (losses)	13 14	340,890	(65,035)	275,855	125,843		(529,948)	(404,105)
Foreign Exchange		33,151	-	33,151	(19,641)		-	(19,641)

Profit/(loss) before tax		12,152,100	(4,979,191)	7,172,909	8,354,144		(6,179,080)	2,175,064

Tax expense	15	(662,041)	-	(662,041)	(448,518)		-	(448,518)

Profit/(loss)		11,490,059	(4,979,191)	6,510,868	7,905,626		(6,179,080)	1,726,546

Profit/(loss) attributable to:
Owners of the parent		11,490,059	(4,979,191)	6,510,868	7,905,626		(6,179,080)	1,726,546
		11,490,059	(4,979,191)	6,510,868	7,905,626		(6,179,080)	1,726,546
Basic earnings per share attributable to owners of the parent (expressed in pence per share)	31	4.50	(1.95)	2.55	4.20		(3.28)	0.92
Diluted earnings per share attributable to owners of the parent (expressed in pence per share)	31	4.15	(1.80)	2.35	3.78		(2.96)	0.82

* Non-underlying items represent acquisition related expenses, restructuring costs, certain finance costs, share option expense and amortisation of acquired intangibles. See Note 11 for more information.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2020

		Year ended 31 December 2020	Year ended 31 December 2019
	Note	£	£

Profit/(loss) for the year		6,510,868	1,726,546
Other comprehensive income:
Items that will or may be reclassified to profit or loss:
FX translation reserve		2,379,173	(447,978)
		8,890,041	1,278,568

Total comprehensive income		8,890,041	1,278,568

Total comprehensive income attributable to:
Owners of the parent		8,890,041	1,278,568
Total comprehensive income for the period		8,890,041	1,278,568

STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2020

		Consolidated		Company
		31 December 2020	31 December 2019	31 December 2020	31 December 2019
	Note	£	£	£	£
Non-current assets
Property, plant and equipment	16	144,793,014	78,718,333	52,005	71,765
Intangible assets	17	48,803,895	80,243,724	-	-
Investments in subsidiary undertakings	18	-	-	101,249,110	94,370,845
Investment in equity-accounted associate	19	-	5,538,212	-	5,538,212
Other receivables		21,327	19,996	-	-
Deferred tax asset	15	1,411,980	-	-	-
		195,030,216	164,520,265	101,301,115	99,980,822
Current assets
Trade and other receivables	20	20,342,578	22,232,596	997,856	787,825
Inventories	21	14,247,379	11,160,574	-	-
Cash and cash equivalents	22	27,451,984	9,867,696	11,521,206	3,935,831
Derivative financial asset		151,770	-	151,770	-
		62,193,711	43,260,866	12,670,832	4,723,656
Total assets		257,223,927	207,781,131	113,971,947	104,704,478

Current liabilities
Trade and other payables	23	46,522,548	37,158,011	14,215,450	16,844,018
Current tax payable		706,698	884,871	-	-
Borrowings	24	3,611,169	4,461,336	20,653	24,827
		50,840,415	42,504,218	14,236,103	16,868,845
Non-current liabilities
Borrowings	24	67,688,396	55,194,015	22,341	41,671
Deferred tax liabilities	15	3,871,086	1,098,148	-	-
Provisions	25	6,160,352	6,936,754	-	-
Other payables	23	5,100,196	-	5,100,196	-
		82,820,030	63,228,917	5,122,537	41,671
Total liabilities		133,660,445	105,733,135	19,358,640	16,910,516
Net assets		123,563,482	102,047,996	94,613,307	87,793,962

Equity attributable to owners of the parent
Share capital	28	2,787,393	2,537,393	2,787,393	2,537,393
Share premium	28	107,417,822	95,358,556	107,417,822	95,358,556
Share option reserve	29	847,392	531,213	847,392	531,213
Other reserves	30	3,292,913	913,740	1,361,718	1,361,718
Retained earnings		9,217,962	2,707,094	(17,801,018)	(11,994,918)
Total equity		123,563,482	102,047,996	94,613,307	87,793,962

The Company has elected to take the exemption under Section 408 of the Companies Act 2006 from presenting the Company's Income Statement and Statement of Comprehensive Income.

The loss for the Company for the year ended 31 December 2020 was £5,806,100 (year ended 31 December 2019: £4,699,471).

The Financial Statements were approved and authorised for issue by the Board of Directors on 12 April 2021 and were signed on its behalf by:

Dean Masefield

Chief Financial Officer

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2020

		Share capital	Share premium	Share option reserve	Other reserves	Retained earnings	Total
	Note	£	£	£	£	£	£
Balance as at 1 January 2019		1,367,056	50,136,904	352,877	1,361,718	910,556	54,129,111
Profit for the year		-	-	-	-	1,726,546	1,726,546
Currency translation differences		-	-	-	(447,978)	-	(447,978)
Total comprehensive income for the period		-	-	-	(447,978)	1,726,546	1,278,568
Contributions by and distributions to owners
Issue of share capital		1,101,788	44,071,478	-	-	-	45,173,266
Issue costs	28	-	(1,531,276)	-	-	-	(1,531,276)
Share based payments		68,549	2,681,450	178,336	-	-	2,928,335
IFRS 16 Adjustments		-	-	-	-	69,992	69,992
Total contributions by and distributions to owners		1,170,337	45,221,652	178,336	-	69,992	46,640,317
Balance as at 31 December 2019		2,537,393	95,358,556	531,213	913,740	2,707,094	102,047,996

Balance as at 1 January 2020		2,537,393	95,358,556	531,213	913,740	2,707,094	102,047,996
Profit for the year		-	-	-	-	6,510,868	6,510,868
Currency translation differences		-	-	-	2,379,173	-	2,379,173
Total comprehensive income for the period		-	-	-	2,379,173	6,510,868	8,890,041
Contributions by and distributions to owners
Issue of share capital		243,127	12,156,369	-	-	-	12,399,496
Issue costs	28	-	(440,735)	-	-	-	(440,735)
Share based payments		6,873	343,632	316,179	-	-	666,684
Total contributions by and distributions to owners		250,000	12,059,266	316,179	-	-	12,625,445
Balance as at 31 December 2020		2,787,393	107,417,822	847,392	3,292,913	9,217,962	123,563,482

COMPANY STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2020

		Share capital	Share premium	Share option reserve	Other reserves	Retained earnings	Total
	Note	£	£	£	£	£	£
Balance as at 1 January 2019		1,367,056	50,136,904	352,877	1,361,718	(7,294,779)	45,923,776
Profit/(Loss)		-	-	-	-	(4,699,471)	(4,699,471)
Total comprehensive income for the period		-	-	-	-	(4,699,471)	(4,699,471)
Contributions by and distributions to owners
Issue of share capital		1,101,788	44,071,478	-	-	-	45,173,266
Issue costs	28	-	(1,531,276)	-	-	-	(1,531,276)
Share based payments		68,549	2,681,450	178,336	-	-	2,928,335
IFRS 16 Adjustments		-	-	-	-	(668)	(668)
Total contributions by and distributions to owners		1,170,337	45,221,652	178,336	-	(668)	46,569,657
Balance as at 31 December 2019		2,537,393	95,358,556	531,213	1,361,718	(11,994,918)	87,793,962

Balance as at 1 January 2020		2,537,393	95,358,556	531,213	1,361,718	(11,994,918)	87,793,962
Profit/(Loss)		-	-	-	-	(5,806,100)	(5,806,100)
Total comprehensive income for the period		-	-	-	-	(5,806,100)	(5,806,100)
Contributions by and distributions to owners
Issue of share capital		243,127	12,156,369	-	-	-	12,399,496
Issue costs	28	-	(440,735)	-	-	-	(440,735)
Share based payments		6,873	343,632	316,179	-	-	666,684
Total contributions by and distributions to owners		250,000	12,059,266	316,179	-	-	12,625,445
Balance as at 31 December 2020		2,787,393	107,417,822	847,392	1,361,718	(17,801,018)	94,613,307

CASH FLOW STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2020

		Consolidated		Company
		Year ended 31 December 2020	Year ended 31 December 2019	Year ended 31 December 2020	Year ended 31 December 2019
	Note	£	£	£	£
Cash flows from operating activities
Profit/(loss)		6,510,868	1,726,545	(5,484,197)	(4,699,471)
Adjustments for:
Depreciation and amortisation	16 17	10,886,578	6,125,957	28,951	19,472
Share option expense		316,179	178,336	316,179	178,336
Loss/(gain) on sale of PP&E		(372,966)	41,438	-	-
Net finance costs		2,738,829	1,963,579	203,280	361,796
Income tax expense		662,041	448,518	-	-
Share of earnings from associates		(293,975)	(84,018)	-	-
Non-cash items		649,799	(2,852,839)	350,505	(1,257,541)
(Increase)/decrease in trade and other receivables		7,558,948	(838,384)	(211,035)	(620,575)
(Increase)/decrease in inventories		(1,008,047)	490,462	-	-
(Decrease)/increase in trade and other payables		2,713,707	(4,522,142)	(135,808)	1,356,158
Increase in provisions		-	91,407	-	-
Income tax paid		(1,894,398)	(615,128)	-	-
Net cash flows from operating activities		28,467,563	2,153,731	(4,932,125)	(4,661,825)
Investing activities
Purchase of property, plant and equipment	16	(6,451,893)	(3,384,363)	(8,886)	(32,535)
Sale of property, plant and equipment		895,962	48,475	-	-
Purchase of intangible assets	17	(152,617)	(3,611)	-	-
Acquisition of businesses (net of cash acquired)		(8,382,804)	(35,931,107)	(10,116,675)	(36,741,325)
Financial derivative		(151,770)	-	(151,770)
Interest received		185,704	773	37,813	773
Net cash used in investing activities		(14,057,418)	(39,269,833)	(10,239,518)	(36,773,087)
Financing activities
Proceeds from share issue		12,399,496	45,173,266	12,399,496	45,173,266
Cost of share issue		(440,735)	(1,531,274)	(440,735)	(1,531,274)
Proceeds from borrowings		67,645,725	20,171,691	-	-
Cost of borrowings		(858,562)	(184,000)	-	-
Repayment of borrowings		(73,148,153)	(18,720,774)	(23,032)	(10,000,000)
Net loans with subsidiaries		-	-	10,809,549	11,655,492
Interest paid		(2,486,688)	(1,678,500)	(695)	(40,927)
Repayment of finance lease obligations		-	-	-	-
Net cash used in financing activities		3,111,083	43,230,409	22,744,583	45,256,557

Net increase/(decrease) in cash and cash equivalents		17,521,228	6,114,307	7,572,940	3,821,645
Cash and cash equivalents at beginning of period		9,867,696	3,771,735	3,935,831	115,756
Exchange losses on cash		63,060	(18,346)	12,435	(1,570)
Cash and cash equivalents and end of period	22	27,451,984	9,867,696	11,521,206	3,935,831

Major non-cash transactions

During the year ended 31 December 2020 there were share based payments of £350,505 to CDH employees and consultants and non-cash additions of property, plant and equipment. The remainder of non-cash movements are not considered material.

NOTES TO THE FINANCIAL STATEMENTS

1. General Information

The principal activity of SigmaRoc plc (the 'Company') is to make investments and/or acquire projects in the construction materials sector and through its subsidiaries (together the 'Group') is the production of high-quality aggregates and supply of value-added construction materials. The Company's shares are admitted to trading on the AIM Market of the London Stock Exchange ('AIM'). The Company is incorporated and domiciled in the United Kingdom.

The address of its registered office is 7-9 Swallow Street, London, W1B 4DE.

2. Accounting Policies

The principal accounting policies applied in the preparation of these Financial Statements are set out below ('Accounting Policies' or 'Policies'). These Policies have been consistently applied to all the periods presented, unless otherwise stated.

2.1. Basis of Preparing the Financial Statements

The Financial Statements have been prepared in accordance with International Financial Reporting Standards ('IFRS') and IFRIC Interpretations Committee ('IFRIC IC') as adopted by the European Union. The Financial Statements have also been prepared under the historical cost convention.

The Financial Statements are presented in UK Pounds Sterling rounded to the nearest pound.

The preparation of Financial Statements in conformity with IFRS's requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's Accounting Policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Financial Information are disclosed in Note 4 .

a) Changes in Accounting Policy

i) New and amended standards adopted by the Group

The Group has adopted the following standards from 1 January 2020:

- Amendments to References to Conceptual Framework in IFRS Standards

- Amendments to IFRS 3

- Definition of a business

- Amendments to IAS 1 and IAS 8 - Definition of material

- Amendments to IFRS 9, IAS 39 and IFRS 7 - Interest Rate Benchmark Reform

The adoption of these standards has not had a material impact on the Financial Statements.

New IFRS Standards and Interpretations not adopted

At the date on which these Financial Statements were authorised, there were no Standards, Interpretations and Amendments which had been issued but were not effective for the year ended 31 December 2020 that are expected to materially impact the Group's Financial Statements.

ii) New standards, amendments and interpretations in issue but not yet effective or not yet endorsed and not early adopted

Standards, amendments and interpretations that are not yet effective and have not been early adopted are as follows:

Standard	Impact on initial application	Effective date
IFRS 3	Reference to Conceptual Framework	1 January 2022
IAS 37	Onerous contracts	1 January 2022
IAS 16	Proceeds before intended use	1 January 2022
Annual improvements	2018-2020 Cycle	1 January 2022
IFRS 17	Insurance contracts	1 January 2023
IAS 8	Accounting estimates	1 January 2023
IAS 1	Classification of Liabilities as Current or Non-Current.	1 January 2023

The Group is evaluating the impact of the new and amended standards above which are not expected to have a material impact on the Group's results or shareholders' funds

2.2. Basis of Consolidation

The Consolidated Financial Statements consolidate the Financial Statements of the Company and the accounts of all of its subsidiary undertakings for all periods presented.

Subsidiaries are entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

The Group applies the acquisition method of accounting to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date.

Acquisition-related costs are expensed as incurred unless they result from the issuance of shares, in which case they are offset against the premium on those shares within equity.

Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in accordance with IAS 39 either in profit or loss or as a change to other comprehensive income. Contingent consideration that is classified as equity is not re-measured, and its subsequent settlement is accounted for within equity.

Investments in subsidiaries are accounted for at cost less impairment.

Associates are entities over which the Group has significant influence but not control over the financial and operating policies. Investments in associates are accounted for using the equity method of accounting and are initially recognised at cost. The Group's share of its associates' post-acquisition profits or losses is recognised in profit or loss, and its share of post-acquisition movements in reserves is recognised in other comprehensive income. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment.

Accounting policies of equity-accounted investees have been changed where necessary to ensure consistency with the policies adopted by the Group.

Where considered appropriate, adjustments are made to the financial information of subsidiaries to bring the accounting policies used into line with those used by other members of the Group. All intercompany transactions and balances between Group enterprises are eliminated on consolidation.

CDH use Belgian GAAP rules to prepare and report their financial statements. The Group reports using IFRS standards and in order to comply with the Group's reporting standards, management of CDH processed several adjustments to ensure the financial information included at a Group level complies with IFRS. CDH will continue to prepare their company financial statements in line with the Belgian GAAP rules.

2.3. Going Concern

As described in note 38 , the Group is managing the impact of the COVID-19 pandemic on its business and the uncertainty it creates. The Executive management team have prepared a range of simulated scenarios based on reductions in revenues, and from these, they believe that the Group has a sufficiently robust balance sheet to endure the Coronavirus pandemic.

The Financial Statements have been prepared on a going concern basis. The Directors have a reasonable expectation that the Group and Company have adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the Financial Statements.

2.4. Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions.

2.5. Foreign Currencies

a) Functional and Presentation Currency

Items included in the Financial Statements are measured using the currency of the primary economic environment in which the entity operates (the 'functional currency'). The Financial Statements are presented in Pounds Sterling, rounded to the nearest pound, which is the Group's functional currency.

b) Transactions and Balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where such items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Income Statement. Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Income Statement within 'finance income or costs. All other foreign exchange gains and losses are presented in the Income Statement within 'Other net gains/(losses)'.

Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss. Translation differences on non-monetary financial assets measured at fair value, such as equities classified as available for sale, are included in other comprehensive income.

c) Group companies

The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

· assets and liabilities for each period end date presented are translated at the period-end closing rate;

· income and expenses for each Income Statement are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and

· all resulting exchange differences are recognised in other comprehensive income.

On consolidation, exchange differences arising from the translation of the net investment in foreign entities, and of monetary items receivable from foreign subsidiaries for which settlement is neither planned nor likely to occur in the foreseeable future, are taken to other comprehensive income. When a foreign operation is sold, such exchange differences are recognised in the Income Statement as part of the gain or loss on sale.

2.6. Intangible Assets

Goodwill arises on the acquisition of subsidiaries and represents the excess of the consideration transferred and the acquisition date fair value of any previous equity interest in the acquire over the fair value of the net identifiable assets, liabilities and contingent liabilities of the acquire. If the total of consideration transferred, non-controlling interest recognised and previously held interest measured at fair value is less than the fair value of the net assets of the subsidiary acquired, in the case of a bargain purchase, the difference is recognised directly in the Income Statement.

As reported within the CEO's strategic report, a PPA was carried out to assess the fair value of the assets acquired in CDH as at the completion date. As a result of this exercise, goodwill in CDH decreased from £51 million to £7.2 million with the corresponding movement being property, plant and equipment and intangible assets. The current accounting policies regarding the subsequent treatment intangible assets will apply to fair value uplift attributable to the PPA.

Amortisation is provided on intangible assets to write off the cost less estimated residual value of each asset over its expected useful economic life on a straight-line basis at the following annual rates:

Goodwill	0%
Customer relations	7% - 12.5%
Intellectual property	10 - 12%
Research and Development	10% - 20%
Branding	5% - 10%
Other intangibles	0%

For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash-generating units, or groups of cash-generating units, that are expected to benefit from the synergies of the combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level.

Goodwill is not amortised however impairment reviews are undertaken annually, or more frequently if events or changes in circumstances indicate a potential impairment. The carrying value of goodwill is compared to the recoverable amount, which is the higher of value in use, discounted to present value using a pre tax discount rate reflective of the time value of money and risks specific to the business unit. Any impairment is recognised immediately as an expense and is not subsequently reversed .

Other intangibles consist of an option over gravel in Poundfield and capitalised development costs for assets produced that assist in the operations of the Group and incur revenue. The option for gravel is amortised based on units of production and the development costs are amortised over the life of the asset. Impairment reviews are performed annually. Where the benefit of the intangible ceases or has been superseded, these are written off the Income Statement.

2.7. Property, Plant and Equipment

Property, plant and equipment is stated at cost, plus any purchase price allocation uplift, less accumulated depreciation and any accumulated impairment losses. Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the Income Statement during the financial period in which they are incurred.

Depreciation is provided on all property, plant and equipment to write off the cost less estimated residual value of each asset over its expected useful economic life on a straight-line basis at the following annual rates:

Office equipment	12.5% - 50%
Land and Buildings	0 - 2%
Plant and machinery	5% - 20%
Furniture and vehicles	7.5% - 33.3%
Construction in progress	0%

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposal are determined by comparing the proceeds with the carrying amount and are recognised within 'Other net gains/(losses)' in the Income Statement.

2.8. Land, Mineral Rights and Restoration Costs

Land, quarry development costs, which include directly attributable construction overheads and mineral rights are recorded at cost plus any purchase price allocation uplift. Land and quarry development are depreciated and amortised, respectively, using the units of production method, based on estimated recoverable tonnage.

Where the Group has a legal or constructive obligation for restoration of a site the costs of restoring this site is provided for. The initial cost of creating this provision is capitalised within property, plant and equipment and depreciated over the life of the site. The provisions are discounted to their present value at a rate which reflects the time value of money and risks specific to the liability. Changes in the measurement of a previously capitalized provision are accordingly added or deducted from the value of the asset.

The depletion of mineral rights and depreciation of restoration costs are expensed by reference to the quarry activity during the period and remaining estimated amounts of mineral to be recovered over the expected life of the operation.

2.9. Financial Assets

Classification

The Group's financial assets consist of loans and receivables. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.

(i) Financial Assets at Fair Value through Profit or Loss

Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term. Derivatives are also categorised as held for trading unless they are designated as hedges.

Assets in this category are classified as current assets if expected to be settled within 12 months; otherwise, they are classified as non-current. The Group holds call options to cover their exposure relative to fluctuations against the Euro. They hold call options to purchase €4,000,000 on 30 June 2021 and €6,000,000 on 31 December 2021, such call options being bought for £190,145. These were purchased on 11 December 2020 and as the value is deemed to be immaterial to the Group, hedge accounting is not required.

(ii) Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the balance sheet date. These are classified as non-current assets. The Group's loans and receivables comprise trade and other receivables and cash and cash equivalents at the year-end.

Recognition and Measurement

Regular purchases and sales of financial assets are recognised on the trade date - the date on which the Group commits to purchasing or selling the asset. Financial assets carried at fair value through profit or loss is initially recognised at fair value, and transaction costs are expensed in the Income Statement. Financial assets are derecognised when the rights to receive cash flows from the assets have expired or have been transferred, and the Group has transferred substantially all of the risks and rewards of ownership.

Loans and receivables are subsequently carried at amortised cost using the effective interest method.

Gains or losses arising from changes in the fair value of financial assets at fair value through profit or loss are presented in the Income Statement within "Other (Losses)/Gains" in the period in which they arise.

Impairment of Financial Assets

The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset, or a group of financial assets, is impaired. A financial asset, or a group of financial assets, is impaired and impairment losses are incurred, only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the assets (a "loss event"), and that loss event (or events) has an impact on the estimated future cash flows of the financial asset, or group of financial assets, that can be reliably estimated.

The criteria that the Group uses to determine that there is objective evidence of an impairment loss include:

· significant financial difficulty of the issuer or obligor;

· a breach of contract, such as a default or delinquency in interest or principal repayments;

· the Group, for economic or legal reasons relating to the borrower's financial difficulty, granting to the borrower a concession that the lender would not otherwise consider; and

· it becomes probable that the borrower will enter bankruptcy or another financial reorganisation.

The Group first assesses whether objective evidence of impairment exists.

The amount of the loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred), discounted at the financial asset's original effective interest rate. The asset's carrying amount is reduced and the loss is recognised in the Income Statement.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor's credit rating), the reversal of the previously recognised impairment loss is recognised in the Income Statement.

2.10. Inventories

Inventories are initially recognised at cost, and subsequently at the lower of cost and net realisable value. Cost comprises all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of overheads based on normal operating capacity.

Weighted average cost is used to determine the cost of ordinarily interchangeable items.

2.11. Trade Receivables

Trade receivables are amounts due from third parties in the ordinary course of business. If collection is expected in one year or less, they are classified as current assets. If not, they are presented as non-current assets.

2.12. Cash and Cash Equivalents

Cash and cash equivalents comprise cash at bank and in hand and are subject to an insignificant risk of changes in value.

2.13. Share Capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

2.14. Reserves

Share Premium - the reserve for shares issued above the nominal value. This also includes the cost of share issues that occurred during the year.

Retained Earnings - the retained earnings reserve includes all current and prior periods retained profit and losses.

Share Option Reserve - represents share options awarded by the Company.

Other Reserves comprise the following:

Capital Redemption Reserve - the capital redemption reserve is the amount equivalent to the nominal value of shares redeemed by the Group.

Foreign Currency Translation Reserve - represents the translation differences arising from translating the financial statement items from functional currency to presentational currency.

Deferred Shares - are shares that effectively do not have any rights or entitlements.

2.15. Trade Payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.

Trade payables are recognised initially at fair value, and subsequently measured at amortised cost using the effective interest method.

2.16. Provisions

The Group provides for the costs of restoring a site where a legal or constructive obligation exists. The estimated future costs for known restoration requirements are determined on a site-by-site basis and are calculated based on the present value of estimated future costs.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (where the effect of the time value of money is material). The increase in provisions due to the passage of time is included in the Consolidated Statement of Profit or Loss and Comprehensive Loss.

2.17. Borrowings

Bank and Other Borrowings

Interest-bearing bank loans and overdrafts and other loans are recognised initially at fair value less attributable transaction costs. All borrowings are subsequently stated at amortised cost with the difference between initial net proceeds and redemption value recognised in the Income Statement over the period to redemption on an effective interest basis.

2.18. Taxation

Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

2.19. Non-Underlying Items

Non-underlying items are a non IFRS measure, but the Group have disclosed these separately in the financial statements, where it is necessary to do so to provide further understanding of the financial performance of the Group. They are items that are not expected to be recurring or do not relate to the ongoing operations of the Group's business and non-cash items which distort the underlying performance of the business.

2.20. Revenue Recognition

Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods or services supplied in course of ordinary business, stated net of discounts, returns and value added taxes. The Group recognises revenue in accordance with IFRS 15 at either a point in time of over time, depending on the nature of the goods or services and existence of acceptance clauses.

Revenue from the sale of goods is recognised when delivery has taken place and the performance obligation of delivering the goods has taken place. The performance obligation of products sold are transferred according to the specific delivery terms that have been formally agreed with the customer, generally upon delivery when the bill of lading is signed as evidence that they have accepted the product delivered to them.

Revenue from the provision of services is recognised as the services are rendered, in accordance with customer contractual terms.

2.21. Finance Income

Interest income is recognised using the effective interest method.

2.22. Employee Benefits - Defined Contribution Plans

The Group maintains defined contribution plans for which the Group pays fixed contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis and will have no legal or constructive obligation to pay further amounts. The Group's contributions to defined contribution plans are charged to the Income Statement in the period to which the contributions relate.

2.23. Share Based Payments

The Group operates a number of equity-settled, share-based schemes, under which the entity receives services from employees or third-party suppliers as consideration for equity instruments (options and warrants) of the Group. The fair value of the third-party suppliers' services received in exchange for the grant of the options is recognised as an expense in the Statement of Comprehensive Income or charged to equity depending on the nature of the service provided. The value of the employee services received is expensed in the Income Statement and its value is determined by reference to the fair value of the options granted:

· including any market performance conditions;

· excluding the impact of any service and non-market performance vesting conditions (for example, profitability or sales growth targets, or remaining an employee of the entity over a specified time period); and

· including the impact of any non-vesting conditions (for example, the requirement for employees to save).

Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. The total expense or charge is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each reporting period, the entity revises its estimates of the number of options that are expected to vest based on the non-market vesting conditions. It recognises the impact of the revision to original estimates, if any, in the Income Statement or equity as appropriate, with a corresponding adjustment to a separate reserve in equity.

When the options are exercised, the Company issues new shares. The proceeds received, net of any directly attributable transaction costs, are credited to share capital (nominal value) and share premium when the options are exercised.

2.24. Discontinued Operations

A discontinued operation is a component of the Group's business, the operations and cash flows of which can be clearly distinguished from the rest of the Group and which:

· represents a separate major line of business or geographic area of operations;

· is part of a single co-ordinated plan to dispose of a separate major line of business or geographic area of operations; or

· is a subsidiary acquired exclusively with a view to re-sale.

Classification as a discontinued operation occurs at the earlier of disposal or when the operation meets the criteria to be classified as held-for-sale. The Group operates several business units which are constantly reviewed to ensure profitability. During 2019 it was determined that the flagging & paving division at CCP's Bury site was loss making and therefore it was decided that the operations at this site be discontinued. For further information, refer to note 14 .

2.25. Leases

The Group leases certain plant and equipment. Leases of plant and equipment where the Group has substantially all the risks and rewards of ownership are classified as finance leases under IFRS 16. Finance leases are capitalised on the lease's commencement at the lower of the fair value of the leased assets and the present value of the minimum lease payments. Other leases are either small in value or cover a period of less than 12 months.

Each lease payment is allocated between the liability and finance charges. The corresponding rental obligations, net of finance charges, are included in long-term borrowings. The interest element of the finance cost is charged to the Income Statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Assets obtained under finance leases are depreciated over their useful lives. The lease liabilities are shown in note 24 .

Rent payable under operating leases on which the short term exemption has been taken, less any lease incentives received, is charged to the income statement on a straight-line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease asset are consumed.

3. Financial Risk Management

3.1. Financial Risk Factors

The Group's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance.

Risk management is carried out by the UK based management team under policies approved by the Board of Directors.

a) Market Risk

The Group is exposed to market risk, primarily relating to interest rate, foreign exchange and commodity prices. The Group has not sensitised the figures for fluctuations in interest rates, foreign exchange or commodity prices as the Directors are of the opinion that these fluctuations would not have a significant impact on the Financial Statements at the present time. The Directors will continue to assess the effect of movements in market risks on the Group's financial operations and initiate suitable risk management measures where necessary.

b) Credit Risk

Credit risk arises from cash and cash equivalents as well as exposure to customers including outstanding receivables. To manage this risk, the Group periodically assesses the financial reliability of customers and counterparties .

No credit limits were exceeded during the period, and management does not expect any losses from non-performance by these counterparties.

c) Liquidity Risk

The Group 's continued future operations depend on the ability to raise sufficient working capital through the issue of equity share capital or debt. The Directors are reasonably confident that adequate funding will be forthcoming with which to finance operations. Controls over expenditure are carefully managed.

		31 December 2020
	Less than 1 year	Between 1 and 2 years	Between 2 and 5 years	Over 5 years
	£	£	£	£
Borrowings	3,611,169	2,768,017	64,407,879	512,500
Trade and other payables	46,522,548	708,737	361,511	4,029,948
	50,133,717	3,476,754	64,769,390	4,542,448

3.2. Capital Risk Management

The Group 's objectives when managing capital are to safeguard the Group 's ability to continue as a going concern, in order to enable the Group to continue its construction material investment activities, and to maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Group may adjust the issue of shares or sell assets to reduce debts.

The Group defines capital based on the total equity of the Company. The Group monitors its level of cash resources available against future planned operational activities and the Company may issue new shares in order to raise further funds from time to time.

The gearing ratio at 31 December 2020 is as follows:

	Consolidated
	31 December 2020	31 December 2019
	£	£
Total borrowings (Note 24 )	71,299,565	59,655,351
Less: Cash and cash equivalents (Note 22 )	(27,451,984)	(9,867,696)
Net debt	43,847,581	49,787,655
Total equity	123,563,482	102,047,996
Total capital	167,411,063	151,835,651
Gearing ratio	0.26	0.33

4. Critical Accounting Estimates

The preparation of the Financial Statements in conformity with IFRSs requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Financial Statements and the reported amount of expenses during the year. Actual results may vary from the estimates used to produce these Financial Statements.

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Significant items subject to such estimates and assumptions include, but are not limited to:

a) Land and Mineral Reserves

The determination of fair values of land and mineral reserves are carried out by appropriately qualified persons in accordance with the Appraisal and Valuation standards published by the Royal Institution of Chartered Surveyors. The estimation of recoverable reserves is based upon factors such as estimates of commodity prices, future capital requirements and production costs along with geological assumptions and judgements.

The PPAs included the revaluation of land and minerals based on the estimated remaining reserves within St John's, Les Vardes, Aberdo and Carrières du Hainaut quarries. These are then valued based on the estimated remaining life of the mines and the net present value for the price per tonnage.

b) Estimated Impairment of Goodwill

The determination of fair values of assets acquired and liabilities assumed in a business combination involves the use of estimates and assumptions such as discount rates used and valuation models applied as well as goodwill allocation.

Goodwill has a carrying value of £39,965,803 as at 31 December 2020 (31 December 2019: £73,004,627). The Group tests annually whether goodwill has suffered any impairment, in accordance with the accounting policy stated in Note 2.6 to the Financial Statements.

Management has concluded that an impairment charge was not necessary to the carrying value of goodwill for the period ended 31 December 2020 (31 December 2019: £nil). See Note 2.6 to the Financial Statements.

c) Restoration Provision

The Group's provision for restoration costs has a carrying value at 31 December 2020 of £891,125 (31 December 2019: £718,822) and relate to the removal of the plant and equipment held at quarries in the Channel Islands and United Kingdom. The cost of removal was determined by management for the removal and disposal of the machinery at the point of which the reserves are no longer available for business use.

The restoration provision is a commitment to restore the site to a safe and secure environment. The provisions are reviewed annually.

d) Fair Value of Share Options

The Group has made awards of options and warrants over its unissued share capital to certain Directors and employees as part of their remuneration packages. Certain warrants have also been issued to suppliers for various services received.

The valuation of these options and warrants involves making a number of critical estimates relating to price volatility, future dividend yields, expected life of the options and forfeiture rates. These assumptions have been described in more detail in Note 29 to the Financial Statements.

e) Valuation and timing of deferred consideration

As part of the acquisition of GD Harries, the Group has agreed to pay royalty payments over the next 10 years with a minimum total value of £10m. The estimated present value of these payments is £4.69m. In determining this value, management must make critical estimates as to the timing, value and cost of money of these payments.

5. Dividends

No dividend has been declared or paid by the Company during the year ended 31 December 2020 (2019: nil).

6. Segment Information

Management has determined the operating segments based on reports reviewed by the Board of Directors that are used to make strategic decisions. During the periods presented the Group had interests in three key geographical segments, being the United Kingdom, Channel Islands and Belgium. The Belgium segment was included as a key geographical segment in October 2019 when the Group acquired CDH Développement SA. Activities in the United Kingdom, Channel Islands and Belgium relate to the production and sale of construction material products and services.


	31 December 2020
	United Kingdom	Channel Islands	Belgium	Total
	£	£	£	£
Revenue	46,790,487	27,324,939	50,115,689	124,231,115
Profit from operations per reportable segment	10,016,729	9,230,303	14,955,766	34,202,798
Additions to non-current assets	32,030,117	(1,891,258)	371,094	30,509,953
Reportable segment assets	107,559,239	49,214,403	100,450,285	257,223,927
Reportable segment liabilities	76,031,131	5,369,328	52,259,986	133,660,445


	31 December 2019
	United Kingdom	Channel Islands	Belgium	Total
	£	£	£	£
Revenue	32,964,660	29,241,597	8,156,215	70,362,472
Profit from operations per reportable segment	8,170,774	9,198,697	2,068,792	19,438,263
Additions to non-current assets	20,908,087	(1,689,474)	76,354,868	95,573,481
Reportable segment assets	72,555,343	49,710,145	85,515,641	207,781,129
Reportable segment liabilities	51,548,505	4,796,404	49,388,226	105,733,135

7. Revenue

	Consolidated
	31 December 2020	31 December 2019
	£	£
Upstream products	13,333,702	6,972,097
Value added products	105,428,101	56,086,965
Value added services	3,921,116	6,652,397
Other	1,548,196	651,013
	124,231,115	70,362,472

Upstream products revenue relates to the sale of aggregates and cement. Value added products is the sale of finished goods that have undertaken a manufacturing process within each of the subsidiaries. Value added services consists of the transportation, installation and contracting services provided.

8. Expenses by Nature

	Consolidated
	31 December 2020	31 December 2019
	£	£
Cost of sales
Changes in inventories of finished goods and work in progress	(1,757,994)	(680,415)
Production cost of goods sold	11,975,751	6,869,232
Distribution and selling expenses	8,136,509	5,921,567
Raw materials and consumables used	27,740,858	19,320,078
Employee benefit expenses	29,507,527	12,792,817
Depreciation and amortisation expense	9,364,796	4,912,383
Other costs of sale	5,060,870	1,788,547
Total cost of sales	90,028,317	50,924,209
Administrative expenses
Operational admin expenses	17,270,000	9,922,199
Corporate admin expenses	7,330,006	4,953,675
Total administrative expenses	24,600,066	14,875,874

Corporate administrative expenses include £2,047,521 of non-underlying expenses (refer to note 11 ).

During the year the Group (including its overseas subsidiaries) obtained the following services from the Company's auditors and its associates:

	Consolidated
	31 December 2020	31 December 2019
	£	£
Fees payable to the Company's auditor and its associates for the audit of the Company and Consolidated Financial Statements	193,994	171,165
Fees payable to the Company's auditor and its associates for tax services	9,028	30,572
Fees paid or payable to the Company's auditor and its associates for due diligence and transactional services	24,050	140,932
Fees paid to the Company's auditor for other services	-	17,877
	227,072	360,546

9. Employee Benefits Expense

	Consolidated		Company
	31 December 2020	31 December 2019	31 December 2020	31 December 2019
Staff costs (excluding directors)	£	£	£	£
Salaries and wages	31,638,511	16,823,415	1,423,765	902,710
Post-employment benefits	114,443	107,206	51,896	36,430
Social security contributions and similar taxes	431,962	134,524	211,651	59,217
Other employment costs	7,938,620	867,944	65,420	20,724
	40,123,536	17,933,089	1,752,732	1,019,081

	Consolidated		Company
	31 December 2020	31 December 2019	31 December 2020	31 December 2019
Average number of FTE employees by function	#	#	#	#
Management	58	63	5	3
Operations	744	576	-	-
Administration	140	78	2	1
	942	717	7	4

10. Directors' Remuneration

		31 December 2020
	Directors' fees	Bonus	Taxable benefits	Pension benefits	Options issued	Total
	£	£	£	£	£	£
Executive Directors
David Barrett	305,278	280,000	13,800	-	45,855	644,933
Dean Masefield ⁽¹⁾	125,000	90,000	5,792	12,500	66	233,358
Max Vermorken	395,000	380,000	13,800	39,500	109,634	937,934
Non-executive Directors
Dominic Traynor ⁽²⁾	40,000	-	-	5,000	5,101	50,101
Patrick Dolberg ⁽³⁾	40,000	-	-	-	4,430	44,430
Timothy Hall	40,000	-	-	-	27,263	67,263
Garth Palmer⁽⁴⁾	54,962	25,000	-	5,496	30,155	115,613
Simon Chisholm ⁽⁵⁾	28,030	-	-	2,803	-	30,833
Jacques Emsens ⁽⁶⁾	28,030	-	-	-	-	28,030
	1,056,300	775,000	33,392	65,299	222,504	2,152,495

		31 December 2019
	Directors' fees	Bonus	Taxable benefits	Pension benefits	Options issued	Total
	£	£	£	£	£	£
Executive Directors
David Barrett	190,000	230,000	13,800	-	27,700	461,500
Garth Palmer	60,000	-	-	6,000	22,100	88,100
Max Vermorken	250,000	340,000	13,800	25,000	60,676	689,476
Non-executive Directors
Dominic Traynor	32,005	-	-	3,201	5,009	40,215
Patrick Dolberg	32,005	-	-	-	3,442	35,447
Timothy Hall	24,580	-	-	-	11,897	36,477
	588,590	570,000	27,600	34,201	130,824	1,351,215

(1) Appointed on 20 April 2020

(2) Resigned on 18 May 2020

(3) Resigned on 18 May 2020

(4) Garth Palmer was CFO until 20 April 2020 to which when he stepped down and stayed on the board as a Non-Executive director. His bonus was performance based for the period 1 January 2020 until 20 April 20.

(5) Appointed on 20 April 2020

(6) Appointed on 20 April 2020

The bonuses earned in the year by the Directors reflect the performance of the business, were based on industry standard criteria taking into account external market data, were recommended by the Remuneration Committee and approved by the Board.

Details of fees paid to companies and partnerships of which the Directors are related have been disclosed in Note 36 .

11. Non-underlying Items

As required by IFRS 3 - Business Combinations, acquisition costs have been expensed as incurred. Additionally, the Group incurred costs associated with obtaining debt financing, including advisory fees to restructure the Group to satisfy lender requirements.

	Consolidated
	31 December 2020	31 December 2019
	£	£
Acquisition related expenses	1,371,797	2,615,860
Amortisation and remeasurement of acquired assets	1,408,964	1,213,574
Restructuring expenses	802,804	820,949
Equity & debt funding expenses	144,906	659,823
Discontinued operations	100,209	529,948
Share option expense	316,179	178,336
Unwinding of discount on deferred consideration	321,903
Net other non-underlying expenses & gains	512,429	160,590
	4,979,191	6,179,080

Acquisition related expenses include costs relating to the due diligence of prospective pipeline acquisitions, stamp duty on completed acquisitions and other direct costs associated with merger & acquisition activity including a completion bonus to certain employees in relation to the acquisition of CDH. During the year the Group acquired the remaining share capital in GD Harries and Stone Holdings.

Amortisation and remeasurement of acquired assets are non-cash items which distort the underlying performance of the businesses acquired. Amortisation of acquired assets arise from certain fair value uplifts resulting from the PPA. Remeasurement of acquired assets arises from ensuring assets from acquisitions are depreciated in line with Group policy.

Restructuring expenses include advisory fees, redundancy costs and moving expenses. During the year these primarily related to the SigmaPPG platform.

Equity & debt funding expenses relates to consulting fees for the debt refinance.

Share option expense is the fair value of the share options issued during the year, refer to note 29 more information.

Unwinding of discount on deferred consideration is a non-cash adjustment relating to deferred consideration arising on acquisitions.

Discontinued operations include the trading expenses, stock adjustments and redundancies incurred at the Bury site for the period from January 2020 to December 2020. Refer to note 14 for more information.

Net other non-underlying expenses and gains include COVID-19 related costs such as purchases of face masks and other protective equipment, procurement and administration of testing kits, modifications to working environments to ensure safety and other associated costs.

12. Net Finance (Expense)/Income

	Consolidated
	31 December 2020	31 December 2019
	£	£
Convertible loan redemption interest premium	-	(500,000)
Convertible loan note interest expense	-	(39,452)
Other interest (expense)/income	(2,290,520)	(1,294,666)
Other finance (expense)/income	(126,406)	(129,461)
Unwinding of discount on deferred consideration	(321,903)	-
	(2,738,829)	(1,963,579)

13. Other Net Gains/(Losses)

	Consolidated
	31 December 2020	31 December 2019
	£	£
Gain/(losses) on disposal of property, plant and equipment	372,966	(14,536)
Other gain/(loss)	(251,464)	56,361
Loss on call options	(38,375)	-
Share of earnings from associates	293,975	84,018
Loss on discontinued operations	(101,247)	(529,948)
	275,855	(404,105)

For more information on the loss on discontinued operations, please refer to note 14.

14. Discontinued Operations

From due diligence undertaken as part of the acquisition of CCP in January 2019, doubts existed over the viability of the flagging & paving division at its site in Bury. After a detailed review it was determined that the business unit was loss making and it was decided that the operations at this site be discontinued effective from 1 February 2019.

Financial information relating to the discontinued operation for the period is set out below.

Income statement	31 December 2020 £	31 December 2019 £
Revenue		811,862
Cost of sales	(150,038)	(1,103,550)
Gross profit	(150,038)	(291,688)
Administration	(55,781)	(146,429)
Other expenses	105,610	(91,831)
Loss from discontinued operation	(100,209)	(529,948)
Basic earnings per share attributable to owners of the parent (expressed in pence per share)	(0.04)	(0.28)

Cash movement	31 December 2020 £	31 December 2019 £
Net cash outflow from operating activities	(94,040)	(125,846)
Net cash inflow from investing activities	287,500	(212,465)
Net cash inflow from financing activities	-	-
Net increase / (decrease) in cash generated by the subsidiary	193,460	(338,311)

15. Taxation

	Consolidated
	31 December 2020	31 December 2019
Tax recognised in profit or loss	£	£
Current tax	(789,683)	(448,518)
Deferred tax	127,642	-
Total tax charge in the Income Statement	(662,041)	(448,518)

The tax on the Group's profit/(loss) before taxation differs from the theoretical amount that would arise using the weighted average tax rate applicable to the profits/(losses) of the consolidated entities as follows:

	Consolidated
	31 December 2020	31 December 2019
	£	£
Profit/(loss) before tax subject to charge	7,095,798	1,726,545
Tax at the applicable rate of 25.14%	1,784,309	359,294
Effects of:
Expenditure not deductible for tax purposes	1,241,151	639,226
Deferred tax not recognised	(1,859,472)	237,384
Remeasurement of deferred tax for changes in tax rates	(435,771)	(1,041,015)
Income not taxable for tax purposes	(659,432)	-
Depreciation in excess of/(less than) capital allowances	613,251	227,160
Net tax effect of losses carried forward	(21,995)	26,469
Tax charge	662,041	448,518

The weighted average applicable tax rate of 25.14% (2019: 20.81%) used is a combination of the standard rate of corporation tax rate for entities in the United Kingdom of 19% (2019: 19%), 20% on quarrying of minerals and rental property (2019: 20%) in Jersey and Guernsey and 30% (2019: 33.99%) in Belgium.

Deferred Tax Asset	Tax losses	Temporary timing differences	Total
At 1 January 2020	-	-	-
Charged/(credited) directly to equity	402,088	1,009,892	1,411,980
At 31 December 2020	402,088	1,009,892	1,411,980

Deferred Tax Liability	Tax losses	Temporary timing differences	Total
At 1 January 2020	-	1,098,148	1,098,148
Acquisition of subsidiary		2,900,580	2,900,580
Charged/(credited) directly to income statement	(127,642)	-	(127,642)
At 31 December 2020	(127,642)	3,998,728	3,871,086

Deferred income tax assets of £1,411,980 (2019: nil) are recognised to the extent that the realisation of related tax benefits through future taxable profits is probable. Deferred tax liabilities of £3,871,086 (2019: 1,098,148) are recognised in full.

16. Property, Plant and Equipment

	Consolidated
	Office Equipment	Land and minerals	Land and buildings	Plant and machinery	Furniture and vehicles	Construction in progress	Total
	£	£	£	£	£	£	£
Cost
As at 1 January 2019	383,440	37,855,548	22,472,510	17,970,282	7,437,362	1,932,082	88,051,224
Acquired through acquisition	3,194,969	14,844,352	13,385,643	57,825,258	9,642,516	-	98,892,738
Transfer between classes	-	(4,600,000)	5,760,000	-	-	(1,160,000)	-
Fair value adjustment	-	1,762,000	-	-	-	-	1,762,000
IFRS 16 Adjustment	22,689	-	584,785	875,388	-	-	1,482,862
Additions	139,414	145,140	435,886	1,403,634	869,033	391,256	3,384,363
Disposals	(1,173)	-	(4,105,000)	(81,860)	(117,000)	(317,126)	(4,477,693)
Forex	(47,800)	(243,375)	(161,148)	(881,369)	(154,468)	-	(1,488,160)
As at 31 December 2019	3,691,539	49,763,665	38,372,676	77,111,333	17,677,443	846,212	187,462,868
As at 1 January 2020	3,691,539	49,763,665	38,372,676	77,111,333	17,677,443	846,212	187,462,868
Acquired through acquisition	302,871	15,085,384	,1,138,624	17,420,145	6,503,077	-	40,450,102
Transfer between classes	-	-	-	133,245	-	(133,245)	-
Fair value adjustment	-	35,954,347	5,322,372	(48,419)	-	-	41,228,300
Additions	66,574	2,937,442	570,150	1,472,808	870,548	534,371	6,451,893
Disposals	-	(192,147)	-	(580,752)	(780,076)	-	(1,552,975)
Forex	164,480	830,659	544,608	2,989,989	265,970	-	4,795,706
As at 31 December 2020	4,225,464	104,379,350	45,948,430	98,498,349	24,536,962	1,247,338	278,835,894
Depreciation
As at 1 January 2019	321,323	6,950,843	13,405,493	11,192,348	6,209,206	-	38,079,213
Acquired through acquisition	2,812,176	703,698	8,309,696	49,944,448	4,789,797	-	66,559,815
Transfer between classes	-	(63,594)	63,594	-	-	-	-
IFRS 16 Adjustment	-	-	153,779	292,103	-	-	445,882
Charge for the year	130,206	1,010,954	1,089,546	2,019,029	820,604	-	5,070,339
Disposals	(159)	-	(200,298)	(51,769)	(117,000)	-	(369,226)
Forex	(42,585)	(11,537)	(132,643)	(777,290)	(77,433)	-	(1,041,488)
As at 31 December 2019	3,220,961	8,590,364	22,689,167	62,618,869	11,625,174	-	108,744,535
As at 1 January 2020	3,220,961	8,590,364	22,689,167	62,618,869	11,625,174	-	108,744,535
Acquired through acquisition	197,810	1,164,293	39,368	8,062,189	3,246,089	-	12,709,749
Charge for the year	250,226	1,579,146	1,904,968	3,898,612	2,403,723	-	10,036,675
Disposals	-	-	-	(496,507)	(530,725)	-	(1,027,232)
Forex	148,051	39,536	451,292	2,654,356	285,917	-	3,579,152
As at 31 December 2020	3,817,048	11,373,339	25,084,795	76,737,519	17,030,178	-	134,042,879
Net book value
As at 31 December 2019	470,578	41,173,301	15,683,509	14,492,464	6,052,269	846,212	78,718,333
As at 31 December 2020	408,416	93,006,011	20,863,635	21,760,830	7,506,784	1,247,338	144,793,014

The depreciation on the right of use assets for the year ended 31 December 2020 was £1,367,375 (2019: £611,627) and the net book value is £5,475,572 (2019: £6,969,922).

		Company
	Office Equipment		Land & Buildings	Motor Vehicle	Total
	£		£	£	£
Cost
As at 1 January 2019	12,600		-	-	12,600
Additions	8,207		-	24,328	32,535
IFRS 16 Adjustment	-		54,363	-	54,363
Disposals	-		-	-	-
As at 31 December 2019	20,807		54,363	24,328	99,498
As at 1 January 2020	20,807		54,363	24,328	99,498
Additions	8,886		-	-	8,886
Disposals	-		-	-	-
Forex	-		-	305	305
As at 31 December 2020	29,693		54,363	24,633	108,689
Depreciation
As at 1 January 2019	8,261		-	-	8,261
Charge for the year	6,072		13,313	87	19,472
Disposals	-		-	-	-
As at 31 December 2019	14,333		13,313	87	27,733
As at 1 January 2020	14,333		13,313	87	27,733
Charge for the year	7,456		13,313	8,182	28,951
Disposals	-		-	-	-
As at 31 December 2020	21,789		26,626	8,269	56,684
Net book value
As at 31 December 2019	6,474		41,050	24,241	71,765
As at 31 December 2020	7,904		27,737	16,364	52,005

The depreciation on the right of use assets for the year ended 31 December 2020 was £13,313 (2019: £13,313) and the net book value is £27,737 (2019: £41,050).

17. Intangible Assets

						Consolidated
		Goodwill	Customer Relations	Intellectual property	Research & Development		Branding	Other Intangibles	Total
		£	£	£			£	£	£
Cost & net book value
As at 1 January 2019	16,826,369		850,846	684,556	-		613,000	-	18,974,771
Additions	-		-	-	3,611		-	-	3,611
Additions through business combination	61,717,258		-	(83,843)	1,210,452		400,000	414,018	63,657,885
Price Purchase Allocation - CCP	(5,539,000)		3,480,000	-	-		297,000	-	(1,762,000)
Amortisation	-		(481,324)	(44,481)	(26,174)		(43,969)	(13,788)	(609,736)
Forex	-		-	-	(20,807)		-	-	(20,807)
As at 31 December 2019	73,004,627		3,849,522	556,232	1,167,082		1,266,031	400,230	80,243,724
As at 1 January 2020	73,004,627		3,849,522	556,232	1,167,082		1,266,031	400,230	80,243,724
Additions	-		-	-	152,617		-	-	152,617
Additions through business combination	7,887,073		-	-	-		-	-	7,887,073
Price Purchase Allocation - CDH	(43,779,628)		-	-	-		2,292,000	-	(41,487,628)
Amortisation	-		(516,930)	(84,860)	(88,323)		(159,790)	-	(849,903)
Forex	2,853,731		-	-	4,511		-	(230)	2,882,103
As at 31 December 2020	39,965,803		3,332,592	471,372	1,235,887		3,398,241	400,000	48,803,895

An adjustment has been made to reflect the initial accounting for the acquisition of Carrières Du Hainaut ('CDH') by the Company, being the elimination of the investment in CDH against the non-monetary assets acquired and recognition of goodwill. In 2020, the Company determined the fair value of the net assets acquired pursuant to the acquisition of CDH, via a Purchase Price Allocation ('PPA') exercise. The PPA's determined a decrease of £43.8m of goodwill in CDH with the corresponding movement to be recognised as Trademarks and Licences, uplift the value of the Land and Buildings and Land and Minerals and recognition of a deferred tax asset.

The goodwill is made up of £21.2m for the PPG Platform, £8.9m for the Benelux platform, £6.2m for the South Wales platform and £3.7m for the Ronez platform.

The intangible asset classes are:

- Goodwill is the excess of the consideration transferred and the acquisition date fair value of any previous equity interest in the acquire over the fair value of the net identifiable assets.

- Customer relations is the value attributed to the key customer lists and relationships.

- Intellectual property is the patents owned by the Group.

- Research and development is the acquiring of new technical knowledge and trying to improve existing processes or products or developing new processes or products.

- Branding is the value attributed to the established company brand.

- Other intangibles consist of an option over gravel in Poundfield and capitalised development costs for assets produced that assist in the operations of the Group and incur revenue

Amortisation of intangible assets is included in cost of sales on the Income Statement.

Impairment tests for goodwill

Goodwill arising on business combinations is not amortised but is reviewed for impairment on an annual basis, or more frequently if there are indications that the goodwill may be impaired. Goodwill is allocated to groups of cash generating units according to the level at which management monitor that goodwill, which is at the level of operating segments.

The seven operating segments are considered to be Ronez in the Channel Islands, Topcrete in the UK, Poundfield in the UK, CCP in the UK, GD Harries in the UK, CDH in Belgium and Stone in Belgium.

Key assumptions

The key assumptions used in performing the impairment review are set out below:

Cash flow projections

Cash flow projections for each operating segment are derived from the annual budget approved by the Board for 2020 and the three-year plan to 2021 and 2022. The key assumptions on which budgets and forecasts are based include sales volumes, product mix and operating costs. These cash flows are then extrapolated forward for a further 17 years, with the total period of 20 years reflecting the long-term nature of the underlying assets. Budgeted cash flows are based on past experience and forecast future trading conditions.

Long-term growth rates

Cash flow projections are prudently based on 2 per cent and therefore provides plenty of headroom.

Discount rate

Forecast cash flows for each operating segment have been discounted at rates of 8 per cent which was calculated by an external expert based on market participants' cost of capital and adjusted to reflect factors specific to each operating segment.

Sensitivity

The Group has applied sensitivities to assess whether any reasonable possible changes in assumptions could cause an impairment that would be material to these consolidated Financial Statements. This demonstrated that a 1% increase in the discount rate would not cause an impairment and the annual growth rate is assumed to be 2%.

The Directors have therefore concluded that no impairment to goodwill is necessary.

Impact of Brexit

In performing the impairment review, the Directors have carefully considered the additional uncertainty arising from Brexit through performing additional sensitivity analysis based on Brexit specific scenarios. These included changes to the discount rate and modelling the impact of a significant decline in short-to-medium term growth caused by an economic shock following an exit. This additional analysis indicated the existence of continued headroom for all segments.

18. Investment in Subsidiary Undertakings

	Company
	31 December 2020	31 December 2019
	£	£
Shares in subsidiary undertakings
At beginning of the year	94,370,845	55,481,505
Additions	25,667,619	45,723,272
Disposals	-	-
At period end	120,038,464	101,204,777
Loan from Group undertakings	(18,789,354)	(6,833,932)
Total	101,249,110	94,370,845

Investments in Group undertakings are stated at cost less impairment. During the year the Company acquired the remaining 60% in GDH (Holdings) Limited and 51% in Stone Holdings.

Details of subsidiaries at 31 December 2020 are as follows:

Name of subsidiary	Country of incorporation	Share capital held by Company	Share capital held by Group	Principal activities
SigmaFin Limited	England	£45,181,877		Holding company
Foelfach Stone Limited	England		£1	Construction materials
SigmaGsy Limited	Guernsey		£1	Shipping logistics
Ronez Limited	Jersey		£2,500,000	Construction materials
Pallot Tarmac (2002) Limited	Jersey		£2	Road contracting services
Island Aggregates Limited	Guernsey		£6,500	Waste recycling
Topcrete Limited	England		£926,828	Pre-cast concrete producer
A. Larkin (Concrete) Limited	England		£37,660	Dormant
Allen (Concrete) Limited	England		£100	Holding company
Poundfield Products (Group) Limited	England	£22,167		Holding company
Poundfield Products (Holdings) Limited	England		£651	Holding company
Poundfield Innovations Limited	England		£6,357	Patents & licencing
Poundfield Precast Limited	England		£63,568	Pre-cast concrete producer
Alfabloc Limited	England		£1	Dormant
CCP Building Products Limited	England	£50		Construction materials
Cheshire Concrete Products Limited	England		£1	Dormant
Clwyd Concrete Products Limited	England		£100	Dormant
Country Concrete Products Limited	England		£100	Dormant
CCP Trading Limited	England		£100	Dormant
CCP Aggregates Limited	England		£100,000	Construction materials
CDH Développement SA	Belgium	€23,660,763		Holding company
Carrières du Hainaut SCA	Belgium		€16,316,089	Construction materials
Coordination du Hainaut SCS	Belgium		€45,184,400	Financing company
CDH International SCA	Belgium		€62,000	International marketing
CDH Management 2 SPRL	Belgium		€760,000	Holding company
GDH (Holdings) Limited	England		£54,054	Construction materials
Gerald D. Harries & Sons Limited	England		£112	Construction materials
Stone Holding Company SA	Belgium		€100	Construction materials
Cuvelier Philippe SA	Belgium		€750	Construction materials

Name of subsidiary	Registered office address
SigmaFin Limited	7-9 Swallow Street, London, W1B 4DE
Foelfach Stone Limited	7-9 Swallow Street, London, W1B 4DE
SigmaGsy Limited	Les Vardes Quarry, Route de Port Grat, St Sampson, Guernsey, GY2 4TF
Ronez Limited	Ronez Quarry, La Route Du Nord, St John, Jersey, JE3 4AR
Pallot Tarmac (2002) Limited	Ronez Quarry, La Route Du Nord, St John, Jersey, JE3 4AR
Island Aggregates Limited	Les Vardes Quarry, Route de Port Grat, St Sampson, Guernsey, GY2 4TF
Topcrete Limited	38 Willow Lane, Mitcham, Surrey, CR4 4NA
A. Larkin (Concrete) Limited	38 Willow Lane, Mitcham, Surrey, CR4 4NA
Allen (Concrete) Limited	38 Willow Lane, Mitcham, Surrey, CR4 4NA
Poundfield Products (Group) Limited	The Grove, Creeting St. Peter, Ipswich, England, IP6 8QG
Poundfield Products (Holdings) Limited	The Grove, Creeting St. Peter, Ipswich, England, IP6 8QG
Poundfield Innovations Limited	The Grove, Creeting St. Peter, Ipswich, England, IP6 8QG
Poundfield Precast Limited	The Grove, Creeting St. Peter, Ipswich, England, IP6 8QG
Greenbloc Limited	The Grove, Creeting St. Peter, Ipswich, England, IP6 8QG
CCP Building Products Limited	Llay Road, Llay, Wrexham, Clwyd, LL12 0TL
Cheshire Concrete Products Limited	Llay Road, Llay, Wrexham, Clwyd, LL12 0TL
Clwyd Concrete Products Limited	Llay Road, Llay, Wrexham, Clwyd, LL12 0TL
Country Concrete Products Limited	Llay Road, Llay, Wrexham, Clwyd, LL12 0TL
CCP Trading Limited	Llay Road, Llay, Wrexham, Clwyd, LL12 0TL
CCP Aggregates Limited	Llay Road, Llay, Wrexham, Clwyd, LL12 0TL
CDH Développement SA	Rue de Cognebeau 245, B-7060 Soignies, Belgium
Carrières du Hainaut SCA	Rue de Cognebeau 245, B-7060 Soignies, Belgium
Coordination du Hainaut SCS	Rue de Cognebeau 245, B-7060 Soignies, Belgium
CDH International SCA	Rue de Cognebeau 245, B-7060 Soignies, Belgium
CDH Management 2 SPRL	Rue de Cognebeau 245, B-7060 Soignies, Belgium
GDH (Holdings) Limited	Rowlands View, Templeton, Narbeth, SA67 8RG
Gerald D. Harries & Sons Limited	Rowlands View, Templeton, Narbeth, SA67 8RG
Stone Holding Company SA	Avenue Louise 292, BE-1050 Ixelles, Belgium
Cuvelier Philippe SA	Avenue Louise 292, BE-1050 Ixelles, Belgium

For the year ended 31 December 2020 the Company was entitled to exemption from audit under section 479A of the Companies Act 2006 related to the following subsidiary companies:

· SigmaFin Limited

· Foelfach Stone Limited

· Topcrete Limited

· A. Larkin (Concrete) Limited

· Allen (Concrete) Limited

· Poundfield Products (Group) Limited

· Poundfield Products (Holdings) Limited

· Poundfield Innovations Limited

· Poundfield Precast Limited

· Greenbloc Limited

· CCP Building Products Limited

· Cheshire Concrete Products Limited

· Clwyd Concrete Products Limited

· Country Concrete Products Limited

· CCP Trading Limited

· CCP Aggregates Limited

· GDH (Holdings) Limited

· Gerald D. Harries & Sons Limited

Impairment review

The performance of all companies for the year ended 31 December 2020 are in line with forecasted expectations and as such there have been no indications of impairment.

19. Investment in Equity Accounted Associates

On 18 April 2019, the Company acquired a 40% equity interest in GDH (Holdings) Limited ('GDH'), a quarrying group located in South Wales for a cash consideration of £4.89 million. GDH is based in South Wales and owns six quarries as well as concrete and tarmac plants and is a provider of aggregates for commercial and domestic customers.

On 11 September 2019, the Company acquired 49% equity interest in Stone Holdings SA ('Stone') for a cash consideration of £563k (€658k). Stone is based in Belgium and operates two quarries and a wharf and contracting business which focusses on armour rock for river and sea defence work.

On 21 September 2020, the Company acquired the remaining 60% of the share capital in GDH and its subsidiaries.

On 1 January 2020, the Company acquired a further 25% of Stone for £287k (€339k), and was therefore treated as a subsidiary of the Group for the full 2020 financial year.

On 7 August 2020, the Company acquired the remaining 26% of Stone for £287k (€339k).

Further details on the acquisitions are in note 34 Business Combinations.

For the period 1 January 2020 to 21 September 2020, GDH is included in the consolidated financial statements using the equity method.

				Proportion of ownership interest held
Name	Country of incorporation	31 December 2020			31 December 2019
GDH (Holdings) Limited	United Kingdom		-		40%
Stone Holdings SA	Belgium		-		49%

Summarised financial information

GDH		21 September 2020		31 December 2019
		£		£

Current assets		9,222,637		10,275,551
Non-current assets		27,864,288		26,343,207
Current liabilities			(17,329,654)	(11,234,400)
Non-current liabilities			(7,354,166)	(10,939,312)

	For the period 1 January 2020 to 21 September 2020			For the period 19 April 2019 to 31 December 2019

Revenues			18,479,517	18,982,758
Profit after tax from continuing operations			293,975	83,054

Stone Holdings	1 January 2020	31 December 2019
	£	£
As 31 December 2020
Current assets	830,404	830,404
Non-current assets	3,586,218	3,586,218
Current liabilities	(1,716,439)	(1,716,439)
Non-current liabilities	(549,671)	(549,671)

	For the period 1 January 2020 to 1 January 2020	For the period 11 September 2019 to 31 December 2019
Revenues	-	482,704
Profit after tax from continuing operations	-	964

20. Trade and Other Receivables

	Consolidated		Company
	31 December 2020	31 December 2019	31 December 2020	31 December 2019
	£	£	£	£
Trade receivables	18,074,224	14,662,423	876,972	533,606
Prepayments	1,142,601	1,111,141	113,715	247,050
Other receivables	1,125,753	6,459,032	7,169	7,169
	20,342,578	22,232,596	997,856	787,825

The carrying value of trade and other receivables classified as loans and receivables approximates fair value.

The carrying amounts of the Group and Company's trade and other receivables are denominated in the following currencies:

		Group			Company
	31 December 2020		31 December 2019	31 December 2020		31 December 2019
UK Pounds	14,366,762		15,939,755	997,856		787,825
Euros	5,975,816		6,292,841	-		-
	20,342,578		22,232,596	997,856		787,825

Other classes of financial assets included within trade and other receivables do not contain impaired assets.

The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable mentioned above. The Group does not hold any collateral as security.

21. Inventories

	Consolidated
	31 December 2020	31 December 2019
Cost and net book value	£	£
Raw materials and consumables	5,705,723	3,695,360
Finished and semi-finished goods	7,872,034	7,416,751
Work in progress	669,622	48,463
	14,247,379	11,160,574

The value of inventories recognised as a credit and included in cost of sales was £1,757,994 (31 December 2019: £490,462).

22. Cash and Cash Equivalents

	Consolidated		Company
	31 December 2020	31 December 2019	31 December 2020	31 December 2019
	£	£	£	£
Cash at bank and on hand	27,451,984	9,867,696	11,521,206	3,935,831
	27,451,984	9,867,696	11,521,206	3,935,831

All of the Group's cash at bank is held with institutions with a credit rating of at least A-.

The carrying amounts of the Group and Company's cash and cash equivalents are denominated in the following currencies:

		Group			Company
	31 December 2020		31 December 2019	31 December 2020		31 December 2019
UK Pounds	19,928,816		8,410,763	11,521,206		3,935,831
Euros	7,523,168		1,456,933	-		-
	27,451,984		9,867,696	11,521,206		3,935,831

23. Trade and Other Payables

		Consolidated			Company
	31 December 2020		31 December 2019	31 December 2020		31 December 2019
	£		£	£		£
Current liabilities
Trade payables	16,287,914		10,306,033	147,026		763,808
Wages Payable Accruals	4,307,610 6,290,699		4,072,972 4,173,341	133 1,675,603		- 1,268,750
VAT payable/(receivable)	2,282,241		660,033	(38,859)		(85,508)
Deferred consideration Other payables	13,390,253 3,963,831		16,025,254 1,920,378	12,388,733 42,814		14,881,493 15,475
	46,522,548		55,194,015	14,215,450		16,844,018
Non - Current liabilities
Deferred consideration	5,100,196		-	5,100,196		-
	5,100,196		-	5,100,196		-

The carrying amounts of the Group and Company's trade and other payables are denominated in the following currencies:

		Group			Company
	31 December 2020		31 December 2019	31 December 2020		31 December 2019
UK Pounds	38,548,115		27,130,229	19,315,646		16,844,018
Euros	13,074,629		10,027,782	-		-
	51,622,744		37,158,011	19,315,646		16,844,018

24. Borrowings

		Consolidated			Company
	31 December 2020		31 December 2019	31 December 2020		31 December 2019
	£		£	£		£
Non-current liabilities
Syndicated Senior Credit Facility	61,235,485		-	-		-
Santander term facility	-		25,907,847	-		-
Bank Loans	-		26,216,013	-		-
Finance lease liabilities	6,452,911		3,070,155	22,341		41,671
	67,688,396		55,194,015	22,341		41,671
Current liabilities
Finance lease liabilities	3,611,169		4,461,336	20,653		24,827
	3,611,169		4,461,336	20,653		24,827

In December 2020 the Group entered into a new Syndicated Senior Credit Facility of up to £125 million (the 'Credit Facility') led by Santander UK and including several major UK and European banks. The Credit Facility, which comprises an £85 million committed term facility and a £40 million accordion option. This new facility replaces all previously existing bank loans within the Group.

The restated facility is secured by a floating charge over the assets of SigmaFin Limited and CDH and is secured by a combination of debentures, security interest agreements, pledges and floating rate charges over the assets of SigmaRoc Plc, SigmaFin Ltd, Carrieres du Hainaut and their subsidiary undertakings. Interest is charged at a rate between 1.5% and 3.25% above LIBOR ('Interest Margin'), based on the calculation of the adjusted leverage ratio for the relevant period. For the period ending 31 December 2020 the Interest Margin was 2.25%.

The carrying amounts and fair value of the non-current borrowings are:

	Carrying amount and fair value
	31 December 2020	31 December 2019
	£	£
Santander term facility	61,235,485	25,907,847
Belgian bank loans	-	26,216,013
Convertible loan notes	-	-
Finance lease liabilities	10,064,080	7,531,491
	71,299,565	59,655,351

Finance Lease Liabilities

Lease liabilities are effectively secured, as the rights to the leased asset revert to the lessor in the event of default.

	Consolidated
	31 December 2020	31 December 2019
Finance lease liabilities - minimum lease payments	£	£
Not later than one year	3,611,673	4,461,336
Later than one year and no later than five years	5,823,464	2,902,039
Later than five years	628,944	168,116
	10,064,081	7,531,491
Future finance charges on finance lease liabilities	680,551	367,910
Present value of finance lease liabilities	10,744,632	7,899,401

For the year ended 31 December 2020, the total finance charges were £2,661,447.

The contracted and planned lease commitments were discounted using a weighted average incremental borrowing rate of 3%.

The present value of finance lease liabilities is as follows:

	Consolidated
	31 December 2020	31 December 2019
	£	£
Not later than one year	3,720,023	4,595,176
Later than one year and no later than five years	5,998,168	2,989,100
Later than five years	647,812	173,160
Present value of finance lease liabilities	10,366,003	7,757,436

Reconciliation of liabilities arising from financing activities is as follows:

	Consolidated
	Long-term borrowings	Short-term borrowings	Lease liabilities	Liabilities arising from financing activities
	£	£	£	£
As at 1 January 2020	52,123,860	-	7,531,491	59,655,351
Increase/(decrease) through financing cash flows	1,540,341	-	(3,679,232)	(2,138,891)
Amortisation of finance arrangement fees	(126,406)	-	-	(126,406)
Increase through IFRS 16	-	-	-	-
Increase through obtaining control of subsidiaries	7,697,690	-	6,211,821	13,909,511
As at 31 December 2020	61,235,485	-	10,064,080	71,299,565

25. Provisions

	Consolidated
	31 December 2020	31 December 2019
	£	£
As at 1 January	6,936,754	632,011
Acquired on business combination	172,303	6,620,250
Deduction	(948,705)	(315,507)
	6,160,352	6,936,754

The provision total is made up of £632,011 as a restoration provision for the St John's and Les Vardes sites, £86,812 for the Aberdo site and £172,303 for quarries in Wales which are all based on the removal costs of the plant and machinery at the sites and restoration of the land. Cost estimates in Jersey and Guernsey are not increased on an annual basis - there is no legal or planning obligation to enhance the sites through restoration. The commitment is to restore the site to a safe environment; thus the provision is reviewed on an annual basis. The estimated expiry on the quarries ranges between 5 - 35 years.

Of the remaining amount £1.5m is to cover the loss on the Holcim contract in CDH, £150,000 for legal fees and £3.6m is the provision for early retirement in Belgium, where salaried workers can qualify for early retirement based on age and the number of years of service. The provision for early retirement consists of the estimated amount that will be paid by the employer to the "early retired workers" till the age of the full pension. Refer to note 26 for more information.

The future reclamation cost value is discounted by 7.39% (2019: 12%) which is the weighted average cost of capital within the Group.

26. Retirement benefit schemes

The Group sponsors various post-employment benefit plans. These include both defined contribution and defined benefit plans as defined by IAS 19 Employee Benefits.

Defined contribution plans

For defined contribution plans outside Belgium, the Group pays contributions to publicly or privately administered pension funds or insurance contracts. Once the contributions have been paid, the Group has no further payment obligation. The contributions are expensed in the year in which they are due. For the year ended, contributions paid into defined contribution plans amounted to £434k.

Defined benefit plans

The Group has group insurance plans for some of its Belgian employees funded through defined payments to insurance companies. The Belgian pension plans are by law subject to minimum guaranteed rates of return. In the past the minimum guaranteed rates were 3.25% on employer contributions and 3.75% on employee contributions. A law of December 2015 (enforced on 1 January 2016) modifies the minimum guaranteed rates of return applicable to the Group's Belgian pension plans. For insured plans, the rates of 3.25% on employer contributions and 3.75% on employee contributions will continue to apply to the contributions accumulated before 2016. For contributions paid on or after 1 January 2016, a variable minimum guaranteed rate of return with a floor of 1.75% applies. The Group obtained actuarial calculations for the periods reported based on the projected unit credit method.

Employee benefits amounts in the Statement of Financial Position		2020 £	2019 £
Assets	-		-
Liabilities	3,592,713		3,758,285
Net defined benefit liability at end of year	3,592,713		3,758,285

Amounts recognised in the Statement of Financial Position	2020 £	2019 £
Present value of funded defined benefit obligations	2,379,055	2,252,187
Fair value of plan assets	(2,213,854)	(2,095,797)
	165,201	156,390
Present value of unfunded defined benefit obligation	3,427,512	3,601,895
Unrecognised past service cost	-	-
Total	3,592,713	3,758,285

Amounts recognised in the Income Statement		2020 £	2019 £
Current service cost	128,321		61,871
Interest cost	18,894		3,308
Expected return on plan assets	(31,257)		(46,342)
Total pension expense	115,958		18,837

Changes in the present value of the defined benefit obligation		2020 £		2019 £
Defined benefit obligation at beginning of year		3,758,285		-
Current service cost		128,321		61,871
Interest cost		18,894		3,308
Benefits paid		(493,238)		(84,815)
Remeasurements		(31,257)		(46,342)
Acquired in business combination		-		3,824,263
Foreign exchange movement		211,707		-
Defined benefit obligation at end of year		3,592,712		3,758,285
Amounts recognised in the Statement of Changes in Equity	2020 £		2019 £
Prior year cumulative actuarial remeasurements	(46,342)		-
Remeasurements	(31,257)		(46,342)
Foreign exchange movement	2,610
Cumulative amount of actuarial gains and losses recognised in the Statement of recognised income / (expense)	(74,989)		(46,342)

Movements in the net liability/(asset) recognised in the Statement of Financial Position	2020 £	2019 £
Net liability in the balance sheet at beginning of year	3,758,285	-
Total expense recognised in the income statement	147,215	61,871
Contributions paid by the company	(493,238)	3,308
Amount recognised in the statement of recognised (income)/expense	(31,257)	(84,815)
Acquired in business combination	-	3,777,921
Foreign exchange movement	211,707
Defined benefit obligation at end of year	3,592,712	3,758,285

Principal actuarial assumptions as at 31 December 2020
Discount rate	0.18%
Future salary increases	1.60%
Future inflation	1.68%

Post-retirement benefits

The Group operates both defined benefit and defined contribution pension plans.

Pension plans in Belgium are of the defined benefit type because of the minimum promised return on contributions required by law. The liability or asset recognised in the Statement of Financial Position in respect of defined benefit pension plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms approximating to the terms of the related obligation. The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the Income Statement. Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period in which they occur, directly in other comprehensive income. They are included in retained earnings in the Statement of Changes in Equity and in the Statement of Financial Position.

For defined contribution plans, the Group pays contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis. The Group has no further payment obligations once the contributions have been paid. The contributions are recognised as employee benefit expense when they are due.

27. Financial Instruments by Category

Consolidated		31 December 2020
	Loans & receivables		Total
Assets per Statement of Financial Performance	£		£
Trade and other receivables (excluding prepayments)	19,178,650		19,178,650
Cash and cash equivalents	27,451,984		27,451,984
	46,630,634		46,630,634

	At amortised cost		Total
Liabilities per Statement of Financial Performance	£		£
Borrowings (excluding finance leases)	61,235,485		61,235,485
Finance lease liabilities	10,064,080		10,064,080
Trade and other payables (excluding non-financial liabilities)	51,622,744		51,622,744
	122,922,309		122,922,309

Consolidated		31 December 2019
		Loans & receivables	Total
Assets per Statement of Financial Performance		£	£
Trade and other receivables (excluding prepayments)		21,121,455	21,121,455
Cash and cash equivalents		9,867,696	9,867,696
		30,989,151	30,989,151

	At amortised cost		Total
Liabilities per Statement of Financial Performance	£		£
Borrowings (excluding finance leases)	52,123,860		52,123,860
Finance lease liabilities	7,531,491		7,531,491
Trade and other payables (excluding non-financial liabilities)	37,158,011		37,158,011
	96,813,362		96,813,362

Company			31 December 2020
			Loans & receivables		Total
Assets per Statement of Financial Performance			£		£
Trade and other receivables (excluding prepayments)			884,141		884,141
Cash and cash equivalents			11,521,206		11,521,206
			12,405,347		12,405,347

		At amortised cost			Total
Liabilities per Statement of Financial Performance		£			£
Borrowings (excluding finance leases)		-			-
Finance lease liabilities		42,994			42,994
Trade and other payables (excluding non-financial liabilities)		18,993,743			18,993,743
		19,036,737			19,036,737
Company	31 December 2019
	Loans & receivables			Total
Assets per Statement of Financial Performance	£			£
Trade and other receivables (excluding prepayments)	540,775			540,775
Cash and cash equivalents	3,935,831			3,935,831
	4,476,606			4,476,606

	At amortised cost			Total
Liabilities per Statement of Financial Performance	£			£
Borrowings (excluding finance leases)	-			-
Finance lease liabilities	66,498			66,498
Trade and other payables (excluding non-financial liabilities)	19,315,646			19,315,646
	19,382,144			19,382,144

28. Share Capital and Share Premium

	Number of shares	Ordinary shares	Share premium	Total
		£	£	£
Issued and fully paid
As at 1 January 2019	136,705,557	1,367,056	50,136,904	51,503,960
Issue of new shares - 25 January 2019 ⁽¹⁾	35,135,101	351,351	13,596,828	13,948,179
Issue of new shares - 1 February 2019	1,976,888	19,770	730,230	750,000
Issue of new shares - 15 October 2019 ⁽²⁾	79,921,640	799,216	30,894,594	31,693,810
As at 31 December 2019	253,739,186	2,537,393	95,358,556	97,895,949
As at 1 January 2020	253,739,186	2,537,393	95,358,556	97,895,949
Issue of new shares - 9 December 2020 ⁽³⁾	25,000,000	250,000	12,059,266	12,309,266
As at 31 December 2020	278,739,186	2,787,393	107,417,822	110,205,215

(1) Includes issue costs of £457,215

(2) Includes issue costs of £1,074,061

(3) Includes issue costs of £440,736

On 9 December 2020 the Company raised £11,958,760 net of issue costs via the issue and allotment of 24,312,737 new Ordinary Shares at a price of 51 pence per share. On the same day the Company issued and allotted 687,263 new Ordinary Shares at a price of 51 pence per share as share based payments.

29. Share Options

Share options and warrants outstanding and exercisable at the end of the year have the following expiry dates and exercise prices:

			Options & Warrants
			31 December 2020	31 December 2019
Grant date	Expiry date	Exercise price in £ per share
5 January 2017	4 January 2022	0.44	1,026,014	1,026,014
5 January 2017	22 August 2021	0.25	78,044	78,044
5 January 2017	5 January 2022	0.25	286,160	286,160
5 January 2017	5 January 2022	0.40	12,183,225	12,183,225
15 April 2019	15 April 2026	0.46	3,216,978	3,216,978
30 December 2019	30 December 2026	0.46	2,704,353	2,704,353
30 December 2020	30 December 2026	0.46	5,921,331	-
			25,416,105	19,494,774

The Company and Group have no legal or constructive obligation to settle or repurchase the options or warrants in cash.

The fair value of the share options and warrants was determined using the Black Scholes valuation model. The parameters used are detailed below:

	2017 Options A	2017 Options B	2017 Options C	2017 Options D
Vested on	5/1/2017	5/1/2017	5/1/2017	5/1/2017
Life (years)	5	4	5	5
Share price	0.425	0.425	0.425	0.425
Risk free rate	0.52%	0.52%	0.52%	0.52%
Expected volatility	24.81%	24.81%	24.81%	24.81%
Expected dividend yield	-	-	-	-
Marketability discount	50%	-	-	50%
Total fair value	£46,900	£15,083	£76,418	£234,854

	2019 Options E	2019 Options F	2019 Options G	2019 Options H
Vested on	15/4/2019	30/12/2019	15/4/2020	30/12/2020
Life (years)	7	7	6	6
Share price	0.465	0.525	0.295	0.6575
Risk free rate	0.31%	0.55%	0.40%	0.50%
Expected volatility	4.69%	8.19%	17.46%	12.04%
Expected dividend yield	-	-	-	-
Total fair value	£49,638	£128,698	£21,259	£294,920

The risk-free rate of return is based on zero yield government bonds for a term consistent with the option life.

The volatility is calculated by dividing the standard deviation of the closing share price from the prior six months by the average of the closing share price from the prior six months.

A 50% discount was applied to Options A & D due to the uncertainty surrounding the future performance of the Group. The Options A & D were issued in the first year of acquisitions which at the time had not had a significant impact on the Company's share price. Therefore a 50% discount was applied to reflect the fact the Company was still in an early stage with regards to acquiring niche company's and building value for the shareholders.

A reconciliation of options and warrants granted over the year to 31 December 2020 is shown below:

	31 December 2020			31 December 2019
		Weighted average exercise price			Weighted average exercise price
	Number	£	Number		£
Outstanding at beginning of the year	19,494,774	0.40	13,573,443		0.40
Granted	-	-	17,777,991		0.46
Vested	5,921,331	0.46	-		-
Exercised	-	-	-		-
Outstanding as at year end	31,337,434	0.44	31,351,434		0.44
Exercisable at year end	25,416,105	0.42	19,494,774		0.42

30. Other Reserves

	Company
		Deferred shares	Capital redemption reserve	Foreign currency translation reserve	Total
		£	£	£	£
As at 1 January 2019		761,679	600,039	-	1,361,718
Currency translation differences		-	-	(447,978)	(447,978)
As at 31 December 2019		761,679	600,039	(447,978)	913,740
As at 1 January 2020		761,679	600,039	(447,978)	913,740
Currency translation differences		-	-	2,379, 173	2,379,173
As at 31 December 2020		761,679	600,039	1,931,195	3,292,913

31. Earnings Per Share

The calculation of the total basic earnings per share of 2.55 pence (2019: 0.92 pence) is calculated by dividing the profit attributable to shareholders of £6,510,868 (2019: £1,726,546) by the weighted average number of ordinary shares of 255,310,224 (2019: 188,418,538) in issue during the period.

Diluted earnings per share of 2.35 pence (2019: 0.82 pence) is calculated by dividing the profit attributable to shareholders of £6,510,868 (2019: £1,726,546) by the weighted average number of ordinary shares in issue during the period plus the weighted average number of share options and warrants to subscribe for ordinary shares in the Company, which together total 277,113,850 (2019: 209,045,831). The weighted average number of shares is the opening balance of ordinary shares plus the weighted average of 1,571,038 shares.

Details of share options that could potentially dilute earnings per share in future periods are disclosed in Note 29 .

32. Fair Value Estimation

The Group holds call options to purchase €4,000,000 on 30 June 2021 and €6,000,000 on 30 December 2021.

The call options were bought on 11 December 2020 for £190,145 and as at 31 December they had a fair value of £151,770 resulting in a loss of £38,375. Refer to note 13 for more information.

33. Fair Value of Financial Assets and Liabilities Measured at Amortised Costs

Financial assets and liabilities comprise the following:

· Trade and other receivables

· Cash and cash equivalents

· Trade and other payables

The fair values of these items equate to their carrying values as at the reporting date .

34. Business Combinations

Stone Holdings SA

On 11 September 2019, the Company acquired 49% equity interest in Stone Holdings SA and its subsidiaries ('Stone') for a cash consideration of £563k (€658k). On 1 January 2020, the Group acquired an additional 25% of the share capital of Stone for cash consideration of £312k (€339k) and on 7 August 2020 the Group acquired the remaining 26% for £308k (€339). Stone is registered and incorporated in Belgium. Stone is based in Belgium and operates two quarries and a wharf and contracting business which focusses on armour rock for river and sea defence work. At the time of taking control of Stone they it did not own the mineral reserves and held only a small amount of depreciated assets.

The following table summarises the consideration paid for Stone and the values of the assets and equity assumed at the acquisition date.

Total consideration		£
49% Initial cash consideration	551,886
Share of profit for 2019	816
Fair Value as at 31 December 2019 & Acquisition	552,702
26% Deferred cash consideration - 1 January 2020	287,206
25% Deferred cash consideration - 5 August 2020	287,206
Loans repaid	(321,500)
	805,614

Recognised amounts of assets and liabilities acquired	£
Cash and cash equivalents	71,510
Trade and other receivables	475,165
Inventories	161,445
Property, plant & equipment	275,535
Trade and other payables	(884,030)
Borrowings	(1,026,302)
Total identifiable net liabilities	(926,677)
Goodwill (refer to note 17 )	1,732,291
Total consideration	805,614

GDH (Holdings) Limited

On 16 April 2019, the Group acquired 40% of the share capital of GDH (Holdings) Limited ('GDH') and its subsidiaries for cash consideration of £4.8m. On 21 September 2020, the Group acquired the remaining 60% of the share capital for cash consideration of £6.4 million (being £7.3 million less adjustments for various obligations assumed by the Group as part of the acquisition). Royalty payments are due over the next 12 years and total a minimum of £10m. A minimum amount of £160k is due each year. The royalty payments have been discounted at discount rate, reflecting the Group's cost of money and risks associated with the industry, of 7.39%. For the period that GDH was treated as an associate to the Group the share of profit attributed was £377,029.

In accordance with IFRS 3, the Company will perform a PPA within the 12 months of fully acquiring GDH.

GDH is registered and incorporated in the United Kingdom. The principal activity is the production of high-quality aggregates and supply of value-added construction materials.

The following table summarises the consideration paid for GDH and the values of the assets and equity assumed at the acquisition date.

Total consideration		£
40% cash consideration	4,890,792
Share of profit for 2019	83,054
Fair value as at 31 December 2019	4,973,846
Share of profit for period 1/1/20 - 21/9/20	293,975
Fair value as at 21 September 2020	5,267,821
60% cash consideration	6,442,922
Discounted Royalty payments	4,679,186
Loans repaid	893,266
	17,283,195

Recognised amounts of assets and liabilities acquired	£
Cash and cash equivalents	1,731,621
Trade and other receivables	4,823,982
Inventories	2,238,313
Property, plant & equipment	27,190,620
Tax liabilities	(2,843,842)
Trade and other payables	(8,462,138)
Provisions	(172,303)
Borrowings	(13,377,840)
Total identifiable net assets	11,128,413
Goodwill (refer to note 17)	6,154,782
Total consideration	17,283,195

35. Contingencies

The Group is not aware of any material personal injury or damage claims open against the Group.

36. Related party transactions

Loans with Group Undertakings

Amounts receivable/(payable) as a result of loans granted to/(from) subsidiary undertakings are as follows:

	Company
	31 December 2020	31 December 2019
	£	£
Ronez Limited	(12,878,274)	(9,625,760)
SigmaGsy Limited	(4,455,066)	(3,014,167)
SigmaFin Limited	(7,138,810)	(8,756,846)
Topcrete Limited	(8,178,013)	(1,022,931)
Poundfield Products (Group) Limited	6,363,536	7,088,761
Foelfach Stone Limited	457,326	442,858
CCP Building Products Limited	5,785,781	6,372,333
Carrières du Hainaut SCA	(6,186)	1,681,820
GDH (Holdings) Limited	1,233,517	-
Stone Holdings SA	368,321	-
	(18,447,868)	(6,833,932)

Loans granted to or from subsidiaries are unsecured, interest free and repayable in Pounds Sterling on demand from the Company.

All intra Group transactions are eliminated on consolidation.

Other Transactions

Heytesbury Corporate LLP, a limited liability partnership of which Garth Palmer is a partner, invoiced a total fee of £249,997 (2019: £370,000) for the provision of corporate management and consulting services to the Company. No balance was outstanding at the year-end.

Druces LLP, a limited liability partnership of which Dominic Traynor is a partner, invoiced a fee of £65,542 (2019: £330,072) for the provision of legal services for acquisitions. There was no balance outstanding at year end.

Julia Traynor, the wife of Non-Executive Director Dominic Traynor, invoiced a fee of £26,250 (2019: £40,000) for the provision of administrative and legal services to the Company in relation to prospective acquisitions. No balance was outstanding at the year-end.

Patrick Dolberg invoiced a fee of £45,000 (2019: £45,000) for the provision of consulting services to the Company in relation to prospective acquisitions. No balance was outstanding at the year-end.

37. Ultimate Controlling Party

The Directors believe there is no ultimate controlling party.

38. Events After the Reporting Date

Expansion of aggregates operations in Belgium

On 26 March 2021, the Group entered into an agreement to assume control of LaFargeHolcim's quarrying operations which are located at the Group's CDH site. Prior to entering this agreement, production and commercialisation of the aggregates at the CDH site was undertaken by LaFargeHolcim under an inefficient royalty deal which was due to end in February 2023.

This agreement gives the Group full control over CDH's production assets and will enable the Group to drive operational efficiencies over time.

Acquisition of Belgian concrete assets

On 6 April 2021, the Group, in line with its stated strategy, completed the acquisitions of B-Mix Beton NV, J&G Overslag en Kraanbedrijf BV and Top Pomping NV (collectively 'B-Mix'), as well as Casters Beton NV ('Casters') from Groep Janssens N.V. for a combined cash consideration of €13m.

B-Mix and Casters operate four concrete plants in Tessenderlo and Genk in Belgium. In the year ended 31 December 2020 the businesses, in total, generated a turnover of €22m, EBITDA of €3.3m and a net profit of €1.5m. They will be immediately enhancing to the Group's underlying earnings, and the acquisitions were funded from the net cash proceeds generated by the Group's equity fundraising in December 2020.

No further financial information on these transactions is available at this time, due to the proximity of the acquisitions to the reporting date of these financial statements.

Alongside these acquisitions, the Group has also entered into an option agreement with Jabo N.V., granting it the right to acquire 11 hectares of quayside industrial land in Tessenderlo, for a consideration of €9m. The land subject to the Option includes approximately 260m of quayside along the Albert Canal which houses the B-Mix concrete business.

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