Aquila Services Group PLC Annual Report 2023

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FY2023 Annual Report · Aquila Services Group PLC

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Annual report and
financial statements
for the year ended
31 March 2023

Company Registration No. 08988813 (England and Wales)

Aquila Services Group plc2

Contents

Group highlights

Corporate structure

Aquila at a glance

Chair’s statement

Strategic report

Directors’ report

Corporate governance statement

Directors’ remuneration report

Statement of Directors’ Responsibilities

Independent Auditors’ Report to the Members

Consolidated statement of comprehensive income

Consolidated statement of financial position

Company statement of financial position

Consolidated statement of changes in equity

Company statement of changes in equity

Consolidated statement of cash flow

Company statement of cash flow

Notes to the financial statements

Notice of Annual General Meeting

Directors and advisers

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023

4
4

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5

Group
highlights

Our purpose

To make a better, more sustainable, and socially
responsible world.

Our vision

To have a direct beneficial impact
on communities and lives in the UK and beyond.

To offer staff the opportunity to inspire positive
change in an environment with a strong social focus.

To provide investors the opportunity of supporting an
organisation that combines strong performance with
a positive social outcome.

Our culture and values

We Collaborate
Working together to succeed together

We Innovate
We challenge the norm

We Care
We go the extra mile

What we do

Our work helps our clients to develop a
response to a changing world and make a positive
difference to the communities in which they operate.
We work throughout the UK and internationally with
clients across housing and regeneration, sport and
education, charity and government sectors.

Financial Highlights

For the year ended 31 March 2023

Revenue
£12,249k
(2022: £10,119k)

Gross profit
£2,605k
(2022: £2,206k)

Gross profit margin
21%
(2022: 22%)

Underlying operating profit*
£806k
(2022: £726K)

Statutory profit after tax
£518k
(2022: £579k)

Statutory earnings per share
1.29p
(2022: 1.45p)

Cash generated by operations
£719k
(2022: £512k)

Cash balances
£2,405k
(2022: £2,193k)

Total dividend payable
0.75p per share
(2022: 0.6p)

* Underlying operating profit is calculated by adjusting the reported

pre-tax profit for share-based payment charges and impairments of goodwill.

Dividend

The Directors propose a final dividend of 0.5p per share (2022: 0.4p).
This will be paid on 2 August 2023 to shareholders on the register at 14 July 2023.

Annual report and financial statements for the year ended 31 March 2023

Aquila Services Group plc

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 20236

Aquila at a Glance

Aquila at a glance

Aquila Services Group plc (‘the Company’) is the holding company for Altair Consultancy
and Advisory Services Ltd (‘Altair’), Aquila Treasury and Financial Solutions Ltd (‘ATFS’)
and Oaks Consultancy Ltd (‘Oaks’) which form the group (‘the Group’).

The Group continues to implement its business strategy to encompass all the professional
consultancy services that the Group’s client base demands. The Group now provides advice
and support across the affordable housing, regeneration, sport and education sectors. Its
purpose is to assist organisations that benefit local communities such as housing associations,
local authorities, government agencies, multi-academy trusts, other non-profit organisations
and those set up for community benefit, as well as providing related high-level business advice
to the commercial property sector.

Corporate structure
The corporate structure of the organisation
is shown below.

Aquila
Aquila Services Group plc

Derek Joseph
(Chair)

Claire Banks
(Finance Director & Co Sec)

Fiona Underwood
(Group CEO)

Richard Wollenberg
(Non-Executive)

Altair
Altair Consultancy and Advisory Services Ltd

ATFS
Aquila Treasury and Finance Solutions Ltd

Oaks
Oaks Consultancy Ltd

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 20238

Group members

Altair Consultancy and
Advisory Services Ltd

Aquila Treasury and Financial
Solutions Ltd

Altair is a specialist management consultancy
company that works with organisations that govern,
manage, regulate or build housing. Operating within
the UK and Europe, its international client base is
increasing with expansion in Africa and Asia.
Further information is provided within our
strategic report.

The services that Altair offers cover housing
development and regeneration, property asset
management, health and safety compliance and
building safety advice, strategic financial advice,
governance and risk management, executive
and non-executive recruitment, technology,
transformation and people services. Our commercial,
sustainability and international services are areas of
investment and growth.

ATFS is a specialist treasury management
consultancy authorised and regulated by
the Financial Conduct Authority that operates
across the UK and Europe. It provides advice on
treasury policy and strategy, debt and capital market
finance, banking and card merchant services, value
for money, and financial market information services
to local authorities, charities, housing associations,
education bodies, private sector housing providers
and government bodies.

Work is delivered through fixed price contracts as
retained general treasury advisers and information
subscription agreements. Specific advisory project
contracts are on a fixed fee basis, won through
competitive procurement tenders, payable on
agreed project milestones.

Clients contract with Altair on a fixed-fee basis,
through retained contracts in our finance,
governance and transformation business streams,
and placements for members of the property team
at client sites.

Investments
AssetCore – 5.3% equity holding
AssetCore is a digital financial debt management
platform for the affordable housing sector.

Oaks Consultancy Limited

Oaks is a specialist sports, charity,
statutory and education consultancy operating
within the UK and Europe with an increasing
international presence. Oaks’ clients include
national and international sports teams and
governing bodies, national and international
charities, statutory organisations and local
authorities, multi academy trusts and teaching
school alliances, housing associations and
corporate businesses.

Oaks provides consultancy advice and guidance on
strategy and business planning, organisational and
cultural change programmes, impact measurement,
together with implementation support in relation to
income generation and diversification. Contracts
are delivered through a mix of fixed-fee projects and
retained contracts for general advisory services.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023
10

Chair’s Statement

Chair’s statement
Dear Shareholder, I am pleased to present the Annual
Report and Financial Statements for the year to 31 March 2023.

The report is designed to provide both an overview
of the Group’s business and achievements as well
as a summary of the results for the year. I trust that
shareholders will find the information both helpful
and informative as well as giving them the confidence
that the company works on behalf of the public
good, is progressive and is confident about future
growth. If you would like further information or wish to
discuss the work of the Group, please do not hesitate
to contact one of the directors, details are given on
page 6.

Wage inflation and skills shortages are still a
significant upward pressure on our cost base
so that profit growth lags behind the increase in
turnover. Despite this, the Group has achieved
record operating and gross annual profits.

Group results for the financial year ended
31 March 2023 are a turnover of £12,249 (2022:
£10,119), an increase of 21%; underlying operational
profit of £806k (2022: £726k), up by 8%; and profit
after tax of £518k (2022: £579k), decreased by 12%.

Aquila Services Group plc (‘the Company’) is the
holding company for Altair Consultancy and Advisory
Services Ltd (‘Altair’), Aquila Treasury & Financial
Solutions Ltd (‘ATFS’) and Oaks Consultancy (‘Oaks’)
which form the Group (‘the Group’).

In line with the Financial Reporting Standards the
Group accepted an impairment charge of £120k
on the carrying value of the investment in ATFS which
had previously a significant proportion of its business
from the education sector.

The Group is an independent consultancy which
provides advice and support to organisations both
in the private and public sector that develop and
manage affordable housing, provide education and
sports opportunities as well as to organisations active
in the charity and community sectors. Most clients
operate within the United Kingdom but increasingly
our services are in demand to support the provision
of affordable housing and community services,
particularly in Africa and Asia, where our initiatives
are funded by International Agencies.

My statement at the interim stage reflected that
the easing of restrictions from the pandemic and
economic life returning to normal was an opportunity
for the Group to expand its business. This growth has
continued with turnover for the year 21% higher than
for the previous equivalent 12 months.

The main driver of growth had been through the
affordable housing client base. This has continued
together with an upward trajectory in the sports,
communities and charity sectors. Education has
lagged behind, waiting for procedures to be created
to complement government announcements on
capital allocations.

The Directors recommend a final dividend of 0.5p
(2022: 0.4p) which would total dividends for the year
of 0.75p (2022: 0.6p), an increase of 25%.

The new financial year has started with
some encouraging signs, particularly in the
affordable housing sector both in the UK and
with international clients. There is every expectation
that growth will continue in the sports, community and
charity sectors. We are still awaiting the necessary
clarification on the authorities needed for capital
spending by educational bodies. The evidence for
this continuing growth is the number of enquiries
being received and the increasing value of new
business being won. This will again put pressure on
our staff resources and the requirement for increased
investment in skills and training. The pressures on the
cost base that is reflected in the published accounts
is likely to continue and, with labour market changes,
is likely to be a permanent feature.

During the year we have streamlined our executive
structure to ensure that our investment in skills and
training is protected by more defined career paths
for staff. It has also been a further opportunity to
ensure that we have a succession strategy for all
the key posts.

The FCA has recently announced some
changes they are proposing to make, which when
implemented may have an impact on the costs of
maintaining a listing. As and when these changes
are known, the Board will assess the implications
for the Company.

There is a long list of people who work for us
and those with whom we work that I would want
to thank for their commitment, hard work and
good humour throughout the year. The business
provides services that enhance people’s quality
of life. This should not mean that working for the
business is not also enjoyable as well as fulfilling.
I know that all the members of the board including
myself have enjoyed making our contribution during
the 12 months and we look forward to this continuing
and reporting further progress to shareholders
at the interim stage of the new financial year.
Finally, I must pay tribute to our Chief Executive
Officer, Fiona Underwood. Without her leadership,
management and communication skills, as well as
dedication and hard work, little of the successes of
the year would have been possible.

–
Derek Joseph – Chair
30 June 2023

The services the business offers relate to the
essential needs of people of all ages living in a
developed economy. The pandemic demonstrated
that this is not in itself a protection against the threats
of an increasingly unstable and fragile geopolitical
and economic environment. At any time, we need
to have the optimum organisation of our staff and
the IT that services them. We need the goodwill
of our clients as well as the financial resources to
cover fiscal shocks. We believe these are all now
substantially in place and we continue to review
and update to ensure the resilience of the business.

We all have an ongoing responsibility to
the society and world in which we live. We take
this seriously and we have now combined our
EDI and Green Groups into a new employee body
focussing on ESG. They review and have input into
our policies to ensure that both our recruitment and
our opportunities are open to all, that we minimise
our carbon footprint and treat everyone with the
dignity they have a right to expect, and we are
sensitive to individual needs. We want all those
who work within the business to feel welcome,
valued and treated with respect.

Recent years and especially since the pandemic
have seen reducing levels of interest in smaller
quoted companies listed on the main market of
the London Stock Exchange (LSE). At the same
time the cost of maintaining a listing is significant
and regulatory changes are increasing costs as
a proportion of the Group’s total revenues. In the
Board’s view the increasing profitability of the Group,
the increases in dividends payable and financial
strength has not been reflected in either the share
price or market liquidity.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202312

Strategic Report

Strategic report

Strategy and objectives

Aquila Services Group (Aquila) has a bold purpose to ‘make a better, more sustainable
and socially responsible world’. We achieve this by being a consultancy group which
provides professional support services to socially focused sectors in the UK and internationally.

Our purpose is core to what we want to be across the group:

• We want our subsidiaries to have a direct beneficial impact on communities and lives in the

UK and beyond.

• We want to offer staff the opportunity to inspire positive change in an environment with a

strong social focus.

• And we want to provide investors the opportunity of supporting an organisation that

combines strong performance with a positive social outcome.

Our work helps our clients to develop a response to a changing world and make a positive
difference to the communities in which they operate. At present we work with clients across
housing and regeneration, sport and education, charity and government sectors. We work
across the UK and increasingly internationally.

Our business as at 31 March 2023

Aquila
Aquila Services Group plc

ESG Group

Altair
Altair Consultancy and
Advisory Services Ltd

ATFS
Aquila Treasury and Finance
Solutions Ltd

Oaks
Oaks Consultancy Ltd

Aquila delivers work to clients through key
subsidiaries, each of which has a core market
and service focus:

• Altair provides support for affordable

housing and government bodies through
the development, growth, management,
governance, and operation of organisations,
and the improvement of services to affordable
and social housing customers.

• ATFS is registered with the Financial Conduct

Authority and provides advice to the affordable
housing and education sectors on treasury and
funding solutions.

• Oaks works with clients in the sport,

charity and education sectors focused on
strategy, business planning and income
generation activities.

The Group had two employee led groups
with representation across the Aquila Group.
The aim was to focus activities on the environment
and sustainability, equality, diversity and inclusion
and promoting these initiatives amongst colleagues,
making Aquila an attractive employer to work for.

In October 2022 the Group agreed to combine
the work of the Green and EDI groups and create a
smaller team focussed on the Environment, Social and
Governance (ESG) agenda. The ESG group meets
monthly and its purpose is to drive the ESG agenda
across the Group and its subsidiaries.

Further information about, and activities
within the groups, is available on the website.

Corporate Governance

The Board adopted the QCA code
of Corporate Governance on 1 April 2021.

The Board recognises that the long-term success
of the business is dependent on the way we interact
with a range of key stakeholders as demonstrated
by our compliance with the QCA code, which under
principles 3 and 9 require companies to take account
of wider stakeholder and social responsibilities,
including the implications for long-term success
and to maintain governance structures and
processes that support good decision making.

Section 172(1) (A) to (F) of the Companies
Act 2006 require directors to explain how they
considered the interests of key stakeholders and
the broader matters set out in when performing
their duty to promote the success of the Company
under S172. This includes considering the interest
of other stakeholders which will have an impact on
the long-term success of the company.

This S172 statement explains how the Group and in
particular the board:

•

has engaged with key stakeholders; and

has reached key decisions and the likely impact
of those decisions, including how it has taken
account of the company’s stakeholders in doing
so during the financial year.

The S172 statement focuses on matters of
strategic importance to the Group, and the level
of information disclosed is consistent with the size
and the complexity of the business.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202314

Strategic Report

S172(1) (E)
“The desirability of the company
maintaining a reputation for high
standards of business conduct”

The Group provides professional support services to
socially focused sectors in the UK and internationally,
and always aims to deliver exceptional standards of
service and conduct and remain market leaders in
our sectors.

Our purpose, culture, values and quality assurance
framework dictate the standards that are maintained
by our employees.

S172(1) (F)
“The need to act fairly between
members of the company”

The Group board considers all relevant information
taking into account the impact on all stakeholders
before adopting the best course of action to enable
delivery of the Group’s strategy.

The board listened to the employees and the
EDI Group was created as an employee-led group,
with representation from across Aquila Group and
its subsidiaries. This now forms part of the work of
the ESG Group which has responsibility for driving
Aquila’s approach on equality, diversity and inclusion
ensuring all employees are treated fairly. We also
ensure that our recruitment and succession planning
aims to increase the diversity of the Group.

S172(1) (A)
“The likely consequences of any
decision in the long term”

The Group board reviews all relevant information
and possible scenarios to consider the implications
of any decision made to ensure there is no adverse
impact on the future business or stakeholders of
the Group and that the strategic aims and objectives
of the Group can be achieved. Our longer-term
planning coming out of the pandemic reflects
our approach.

S172(1) (B)
“The interest of the company’s
employees”

The table to the right sets out how the Company
considers the interests of the employees.

S172(1) (C)
“The need to foster the company’s
business relationships with
suppliers, customers and others;”

The table to the right sets out how the Company
considers the interests of the employees.

S172(1) (D)
“The impact of the company’s
operation on the community
and the environment”

The Group is committed to making a better,
more sustainable and socially responsible world.

The board listened to the employees and the
Green Group has evolved into the ESG Group,
with representation from across Aquila Group
and its subsidiaries.

The ESG Group has responsibility for driving Aquila’s
approach to being a climate conscious organisation.
During the year the Group retained its Carbon
Neutral Plus status.

Investors

Employees

Customers

Why they matter to us

Providers of capital
and therefore growth
opportunities.

A significant proportion
of shareholders are
also employees.

Key resource of
talent providing
solutions and innovative
product development
to assist clients.

Critical in achieving the
Group’s objectives.

To offer employees
the opportunity to work
in an environment that has
a positive social impact.

What matters to them

Return on investment.

Recognition and reward.

Our clients provide
services that help in
making a better, more
sustainable, and socially
responsible world.

The aim of the Group
is to assist clients in
achieving this.

They are the Group’s
main source of revenue.

Quality and value
for money.

Longevity of the business.

Interesting work and
strong client relationships.

Sound advice.

Strong culture and values.

Strong relationships with
the Group’s employees.

Type of engagement

Stock Exchange
announcements
and press releases.

Annual and
half-year reports.

Meetings with investors.

Personal and career
development.

Regular staff surveys.

Regular use of different
media forums to inform
and listen.

Investment in
new products and
thought leadership
research pieces.

How the board engages

Board attendance
at the AGM.

Attendance at
staff conferences.

Non-executive
director meetings.

Regular webinar updates
and communications.

How they influence
board-making decisions

Investors’ opinions are
taken into account when
considering future policy.

Following a request
from employees via
staff surveys, the board
actively encouraged
the setting up of the two
employee led groups.
This has transitioned into
the ESG Group with a
wider agenda. They report
their activity to the Group’s
board and employees
bi-annually, and regularly
throughout the year with
Group wide initiatives.

Direct engagement
with clients.

Regular communication
via publications,
and e-bulletins.

Customer
satisfaction survey.

Investment in new
product development.

Customer insight
may lead to research
and product development
opportunities.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202316

Strategic Report

Business environment

Trends and factors

This financial year has seen a challenging macro-economic environment with the increase in inflation
and interest rates affecting clients across all the sectors we work in. This has provided challenges but
also opportunities for the Group and the adaptability of products and the way the Group has responded
to developing new products to assist clients has been reflected in the increased turnover for the year
being reported.

All sectors with the exception of education have ‘opened up’ and the Group’s work reflects the working
patterns of our clients, a combination of face-to-face delivery and virtual. In November 2022 the Office
for National Statistics reclassified further education to the public sector with a subsequent announcement
from the Department for Education on new college borrowing. This has had an impact on the work our
treasury subsidiary undertakes with colleges and it is likely to continue into the next financial year.

Our international clients embraced virtual working during COVID-19 and, by the middle of the financial
year we were able to recommence in-country meetings which has provided opportunities for increasing
our presence in Africa and Asia.

The anticipated changes in government policy and legislation, the Building Safety Bill gaining Royal
Assent and the Charter for Social Housing (The Housing Bill) which is due to gain Royal Assent imminently
have continued to affect clients within the housing sector and during the year they have prepared for the
changes in legislation in both. The work on new products undertaken prior to and during the financial year
has benefited our clients.

The Group’s website shows case studies of the work across the Group.

Task Force on Climate-Related
Financial Disclosures (TCFD)

This section of the Company’s 2023 Annual
Report and Financial Statements includes climate-
related financial disclosures consistent with the
TCFD Recommendations and Recommended
Disclosures as required pursuant to LR 14.3.27.

The Aquila Group recognises the importance
of addressing climate-related risks and
opportunities. The Group has always been
committed to activities that benefit the environment
and society, underpinned by good governance.
The Group’s subsidiaries help customers in
addressing these challenges and realising
their goals.

The Group’s Mission statement is to make a better
more sustainable, and socially responsible world.

•

To have a direct beneficial impact on
communities and lives in the UK and beyond.

To offer staff the opportunity to inspire
positive change in an environment with a
strong social focus.

To provide investors the opportunity
of supporting an organisation that
combines strong performance with a
positive social outcome

In line with the TCFD Recommendations
and Recommended disclosures set out in
Figure 4 of Section C of the report entitled
‘Recommendations of the Task Force on Climate-
related Financial Disclosures’ published in June
2017 by the TCFD the Group have integrated the
TCFD Recommendations as follows:

Governance

Strategy

The Group Board is responsible for managing
climate related risks and realising opportunities.
The Board is supported by the ESG Group who are
responsible for overseeing climate risk assessments
and other aspects of Aquila’s sustainability and ESG
agenda and reporting to the Group Board.

The ESG Group meet monthly and report to the
Group board quarterly. The Board is updated on
progress against targets regularly.

The Board are informed about climate-related
issues via written reports and oral updates which
are also considered when the Board is reviewing
strategy and budgets.

The ESG Group have conducted an assessment
of climate-related risks and opportunities,
considering different climate scenarios.

The time frames selected defined ‘short-term’
as the next one to five years, ‘medium-term’ as five
to ten years and ‘long term’ as ten years or more.
The timelines were chosen to reflect the Group’s
business planning.

The Group has identified three main risks
and opportunities:

Risk

Impact

Potential Impact

Time Frame

Medium

Business
Readiness

Under continuous
monitoring

Increasing
changes in
legislation
relating to
environmental
standards

Changes in
client demands

Employee risk

Business risk
associated
with additional
potential costs
and disclosure.

Change in clients
demands on climate
related issues,
this also offers
opportunities within
the service offer.

As employees are
more concerned
with climate change
issues it is important
to keep up to date
and inform change.
Recruitment and
retention of talent.

High

Short-medium

In plan

High

Short-medium

Under evaluation

The Group do not consider any change in the impact of risk for a below 2 degree scenario.

Risk Management

As part of the work undertaken by the ESG Group they identify opportunities and risks. This process includes
regular risk assessments, scenario analysis, and stress testing to identify, measure, and manage climate risks across our
operations, supply chains, and investment portfolio. We actively engage with stakeholders to ensure a holistic approach to
risk management. Risks are managed on a case-by-case basis. Risks are considered during the business planning process.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202318

Strategic Report

Metrics and Targets

We have established a set of metrics and targets to measure and track our climate performance.
These metrics provide a comprehensive understanding of our environmental impact. Our targets are
aligned with global climate goals and reflect our commitment to reducing emissions, promoting renewable
energy, and improving energy efficiency.

In 2022 the Group offset its total carbon footprint to become a Carbon Neutral Business, this was achieved
through internationally certified carbon offsetting projects through the Carbon Neutral Britain Climate Fund.
The Group commit to maintain this standard.

In 2021-22 the Group commissioned Carbon Neutral Britain to assess the Carbon Emissions of the Group,
the findings for 2021-22 are shown below.

Scope 1 (Direct emissions)

Scope 3 (Other indirect)

Scope 1

Scope 1
21.4%

Scope 2
23.4%

Scope 3
55.2%

Emissions that are a consequence of business
activity, which occur at sources which are not
owned or controlled, which are not classed as
scope 2 emissions. Scope 3 emissions can be quite
broad, including areas such as waste management,
business travel, staff commuting, events, and the
emissions produced from delivery to and from
the organisation (including third party delivery
services). Water (consumption and waste volume),
Waste (landfill, recycled and composted weight),
Business Travel (type and distance), Staff Commuting
(average distance and type), Hotel Stays (UK,
Europe or Worldwide days). The main Scope 3
emissions occurred from staff commuting and the
mileage accumulated within the reporting period.
Additional emissions occurred from organisation
waste, business travel, hotel stays and organisation
water usage. The Group will continue to monitor these
emissions and will continue to work towards reducing
the footprint per FTE. The target is to reduce scope 3
emissions by 25% by 2025.

The results of the assessment for the year 2021-22
were total Carbon Footprint of 36.17tCO2e equating
to 0.38tCO2e per FTE.

Activities owned or controlled by the organisation
that release emissions straight into the atmosphere,
these include Stationary and Mobile Source
Emissions (equipment and quantity combusted),
Company Leased Vehicles (vehicle type and
distance travelled), Refrigerant Gas Losses
(refrigerant type and new/disposed units) for
the organisation only. The main Scope 1 emissions
occurred from main gas combustion from the offices.
No additional emissions occurred due to no company
owned/leased vehicles and/or combustion sources
used within the reporting period. The Group will
continue to monitor these emissions with a target
to reduce emissions by 25% by 2025.

Scope 2 (Energy indirect)

Emissions being released into the atmosphere
associated with the consumption of purchased
electricity, heat, steam and cooling. These are
indirect emissions that are a consequence of the
organisation’s activities - but occur at sources that
the business does not own or control. These emissions
would be the energy usage by the organisation
and staff working at the business, or from home.
Energy (electricity, imported heat, steam in kwh)
using the location based method, staff numbers
and days working from home within reporting period.
The main Scope 2 energy emissions occurred from
the electricity consumption from the Group’s two sites,
with a small amount of additional emissions produced
from staff working at home. These emissions were
attributed to additional energy usage that would
not have otherwise occurred at home. The Group
will continue to monitor these emissions with a target
to reduce emissions by 25% by 2025.

7,738.51

Kg CO2e

Stationary or Mobile Combustion Source (+Mains Gas)

Kg CO2e

Company Owned/Leased Vehicles

Kg CO2e

Refrigerant Gas Loss Recharge

7,738.51

Kg CO2e

Total

7.74

tCO2e

TOTAL (tonnes)

Scope 2

5,550.91

Kg CO2e

Total Organisation Energy Usage on Site

2,918.43

Kg CO2e

Total organisation Energy Usage WFH

8,469.35

Kg CO2e

Total

8.47

tCO2e

TOTAL (tonnes)

Scope 2

2,947.51

Kg CO2e

Organisation Waste

6,515.33

Kg CO2e

Business Travel

9,873.62

Kg CO2e

Staff Commuting

591.72

31.62

Kg CO2e

Business Hotel or event activities

Kg CO2e

Organisation Water Usage

19,959.80

Kg CO2e

Total

19.96

tCO2e

TOTAL (tonnes)

36.17

tCO2e

Total Organisation Emissions

The main emissions occurred from staff commuting.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202320

Strategic Report

The Group’s key initiative in this area is reduced
travel with carbon offset and the continuing adoption
of a “remote first” model for service delivery.

Although many of our employees are remote workers,
when travel cannot be avoided, we continue to
look for new ways to offset our emissions with
reductions elsewhere.

We introduced an E-vehicle salary sacrifice
scheme for staff with the aim of having at least 5%

of employees using the scheme by the end of 2025.
The uptake in this scheme was impacted by the global
supply shortage of EV components causing excessive
lead times.

Looking ahead, we will continue to strengthen
our climate-related reporting practices and explore
innovative solutions to further mitigate climate risks
and capitalise on opportunities.

Principal risks and uncertainties Mitigations of risk

Corporate and social responsibility

The Group recognises that we have a responsibility to ensure the impact of our business
is positive. The Group’s Corporate Social Responsibility policy can be seen on the website.

The Group has adopted policies to ensure that in all work across the Group and its
subsidiaries the impact of human rights, anti-corruption and anti-bribery matters
are considered.

The Group continues to support programmes, on a pro-bono basis that are aimed at
improving the opportunities for individuals from a minority ethnic background and to
increase the diversity of housing sector leaders. In March this year we joined the Future of
London Emerging Talent Programme, providing a placement opportunity for individuals from
a minority ethnic background. Our involvement will span three financial years.

Our subsidiary Oaks supports WAITS as its charity partner. Through this relationship the
Oaks team provide pro bono support with strategy and business planning together with income
generation. As part of the work of the ESG Group there is a project to increase our CSR work and
provide opportunities for more colleagues to be involved.

The Group seeks to mitigate all these risks
through ensuring that it monitors changes in
statutory, regulatory and financial requirements
and maintains good relationships with its clients,
principal contacts within government, regulators
and other key influencers within the sector.

The Group is well placed to provide the full range
of services needed by its clients as the external
environment changes. Our international work will
continue to be impacted due to international travel
restrictions. It is hoped these will further ease during
the year.

Environment

The Group undertakes regular risk assessments,
scenario analysis, and stress testing to identify,
measure, and manage climate risks across all
operations, supply chains, and investment
portfolio. Risks are managed on a case-by-case
basis and are considered during the business
planning process.

Aquila has again achieved Carbon Neutral Plus
status within the year. Further information is on
the website.

The principal risks currently faced by the Group are:

Financial risk
The main financial risks arising from the Group’s
activities are credit risk, foreign currency risk,
interest rate risk and liquidity, details of which can
be found in note 23 to the Financial Statements.

Unfavourable economic conditions
and/or changes to government policy
The current macro-economic uncertainty,
rising interest rates and high inflation may see
a reduction in business as clients spending on
consultancy is curtailed. Local authorities continue
to see significant pressure on budgets and may
stop consultancy contracts and/or limit their
commissioning of work.

The Group mitigates these risks by ensuring that
each subsidiary has diversity across its client base,
not relying on any one client or group of clients.

Changes to government policy may adversely affect
the Group. The Group ensures that it is aware of the
impact of these changes and adapts its products
and services to pro actively respond to this risk.

Competition
Increased competition in the market continues
to pose a risk to all companies within the Group.

Staff skills, retention, recruitment and succession
As the Group is a people-based business,
a significant risk is the recruitment and retention
of talent. The Group continues to monitor retention
and all staff leaving the business have exit
interviews which provides important input into our
People policies to improve our working practices
and environment.

Data governance
The increase of cyber-attacks and the loss of data
is a serious risk that is monitored closely. The Group
complies with all relevant legislation and has invested
in updated systems, security and training. The Group
obtained the certification of Cyber Essentials Plus
status during the year.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023

2222

Strategic Report

23
23

Sustainability is a key focus for clients and we have
invested in this area with the workstream growing over
the year. An example of this is that we have advised
the Future Greener Partnership, a consortium of four
housing providers that collectively own more than
400,000 homes.

In March 2023 we launched a new commercial
services workstream in response to the pressures
on the sector and to support clients in embedding
a commercial approach into the delivery of an
organisation’s purpose to make every pound spent
or earned work as hard as possible.

The Group will continue to invest in products
and services to ensure that we remain relevant
and provide the support and assistance that
our clients need.

ATFS
As part of the succession planning we recruited
an experienced director from the sector who has
taken over responsibility for ATFS and this year
has been introducing new and improving current
products. This will take time to embed especially as
the environment for ATFS continues to be challenging.

The further education sector has been reclassified
by the Office of National Statistics into the central
government sector and this has caused all funding
contracts in this area to be paused.

Funding opportunities in the housing sector continue
with small- and mid-sized organisations in England,
Scotland and Wales and we continued to support
the HFA in Ireland. We have seen increasing
opportunities for ATFS to support our international
work and this is an area we expect to grow in
the coming year.

Business performance
and position

Altair
Altair experienced significant turnover growth
this year, attributed to the growth of the Technology,
Transformation and People workstream which was
successful in winning and delivering a number of
large transformation projects with housing and
care providers in England. These services have been
developed to respond the changes during the year
in the operating environment caused by the rising
interest rates, increasing inflation, the announcement
of a rent cap of 7% which restricts our client’s income
and the increasing negative publicity of the sector.

Housing has hit the headlines on a number of
occasions. On behalf of Peabody Trust Altair
undertook and published a review to provide lessons
learned for the sector following the discovery of
Sheila Seleoane’s body after two and a half years
which has been used by housing providers to ensure
they have the right policies and procedures in place.
The tragic death of Awaab Ishak in Rochdale has
provided a wake-up call for the sector and has seen
the increase in investment in homes and ensuring
that they are safe, affordable and warm for residents.
There is still a significant amount of work to be done
and Altair is pleased to be able to support our clients
with a broad range of services to assist them in the
pursuit of improved services and homes.

Our property team continued to deliver work across
local authorities, housing associations and private
developers. The building safety team ensured clients
were kept updated with the changing government
policy, DynamicAIM, our digital building safety
product has now been procured by two housing
providers and is being piloted in others. We have
invested in Asset Management personnel and are
seeing growth in this service.

We agreed a new business plan for our international
business with a focus on Africa and opportunities
in Asia. This year saw an increase in demand in
the second half and this has continued with new
contracts being awarded for work in Kenya,
Rwanda, Burkina Faso.

Oaks
Oaks had a successful year with growth in
both turnover and profit. Following the approval
of a new business plan, Oaks will make a significant
investment in personnel in the coming year. Central to
this growth programme will be the appointment of four
sector directors to shape and lead its work in sport,
sport for development, charities, and education.
Additionally, Oaks will undertake a full appraisal of its
service offer to ensure it fully meets the needs of the
individual sectors.

Despite the broader economic challenges consistent
growth has been experienced within sport, sport for
development and charities, with the full spectrum of
Oaks’ services being well received. Examples of this
include an expanded relationship with UEFA and
Laureus, strategic and business planning projects
with Euro Hockey, United Rugby Championships, the
FA, Black Country Living Museum, Fashion and Textile
Childrens Trust and CAFÉ. Whilst the education
sector has been less consistent, primarily due to the
legacy impact of COVID 19 and proposed changes
to legislation, Oaks’ work within this sector has still
experienced moderate growth.

In addition to its project commissions the Oaks
retained business remains strong with over 70%
of clients either renewing or expanding their
relationship. This provides the ideal platform for
growth particularly within education where the
retained offer is best suited.

To maintain its position as a significant thought
leader, Oaks has continued to deliver its sport for
development and charity webinar series, with a
global audience of over 1500. Additionally, Oaks has
delivered key presentations to the Premier League
Foundation and FA conferences at the Etihad and
Saint Georges Park.

To demonstrate its clear focus on social value,
Oaks has been proud to continue its pro bono
support for the Birmingham based WAITS charity.

Aquila Services Group plc

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023
24

Strategic Report

Key performance indicators

The Group tracks progress against its strategy by
monitoring its key performance indicators (KPIs)
regularly. These are set out below:

Revenue
£12,249k

The measure
Revenue growth is the increase/decrease
in revenue year-on-year.

The target
To deliver growth in revenue from
expansion both geographically and by
business stream.

Gross profit
£2,605k

The measure
Gross profit growth is the increase/
decrease in gross profit year-on-year.

The target
To deliver growth in gross profit
across all parts of the Group.

Gross profit margin
21%

The measure
Gross profit margin growth is the increase/
decrease in margin year-on-year.

The target
To maintain strong gross profit margins.

2023

2022

2021

2022

2021

2020

k
9
4
2
,
2
1
£

k
5
0
6
,
2
£

%
1
2

k
9
1
1
,
0
1
£

k
6
0
2
,
2
£

%
2
2

k
2
4
6
,
7
£

k
0
4
6
,
1
£

%
1
2

Underlying operating profit
£806k

The measure
The increase/decrease in underlying profit
year on year.

The target
To deliver sustainable growth in
underlaying operating profit. Underlying
operating profit excludes costs and
charges relating to restructuring,
acquisition and share options.

Statutory profit after tax
£ 518k

The measure
The increase/decrease in reported profit
year on year.

The target
To deliver sustainable long term growth
in profit after tax.

Earnings per share
1.29p

The measure
The increase/decrease in EPS year
on year.

The target
To deliver long term growth in EPS
to enhance Shareholder value.

k
6
0
8
£

k
8
1
5
£

p
9
2

.
1

k
6
2
7
£

k
9
7
5
£

p
5
4
.
1

k
4
1
6
£

k
7
8
1
£

p
8
4
0

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023

Strategic Report

Underlying profit is shown as profit before share options charges,
impairment of investments, acquisition costs, redundancy costs and
costs of reorganisation. The Group uses this as a performance measure
of “operational profits” providing a clearer measure year on year without
the distortion of unusual items.

Underlying operating profit

Share option charge

Restructuring costs relating
to COVID-19

Impairment of investments

Impairment of Goodwill

Profit before taxation

31 March 2023
£000

31 March 2022
£000

31 March 2021
£000

806

(12)

(120)

674

726

(8)

718

614

(88)

(175)

(50)

301

Business performance and position

Turnover is split across the different services as shown below.

Revenue from Consultancy

The measure: To track how income across the Group is generated.

Revenue from Treasury
management

2023

96%

2022

94%

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023
28

Strategic Report

Geographic spread of income

The measure: To track where income across the Group is generated.

The target: To increase income from international markets.

Europe

Rest of the world

Spread of income by sector

The measure: To track income across the Group by sector.

The target: To increase market share in other sectors.

Housing

Education

Sports

Charity

2023

96%

2022

94%

2023

89%

2022

94%87%

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023

Strategic Report

Client numbers across the Group

934
The measure
Increased client numbers year on year.

The target
To increase the number of clients that the group deliver services to.

Results
The Group delivered services to 145 new clients in the year.

2023

2022

2021

145

173

177

Client satisfaction

The measure: To ensure all customers are satisfied with the
services delivered across the Group.

The target: To exceed client expectation in delivery of services.

2023

10.00%

Employees

The following disclosures are made in accordance with LR
14.3.33 and LR 14 Annex 1.

A split of our employees and directors by gender and
ethnicity as at the end of the year is shown below:

Male (44 total)

Female (48 total)

Directors

Total senior managers other than
directors of the Company

Other employees of the Group

56% of the Groups employee are female, this is an increase in
the year of 4%.

The following table shows the number of male and female board
members. Women represent 50% of the board.

Number of
board members

Percentage of
the board

Number of
senior positions
on the board

Number in
executive
management

Percentage
of executive
management

Male

Female

50%

54%

46%

Number of clients

Number of new clients

934

509

479

Exceeds client expectations

Meets client service

Exceptional client service

2022

46.00%

36.36%

27.27%

The following table represents the number of directors
and senior managers across the Group and their ethnicity.
The Board are aware that there are no members of the board
from a minority ethnic background, this is being addressed in
conjunction with the succession plan of the Group board.

44.00%

36.36%

42.86%

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023
32

Strategic Report

Number
of board
members

Percentage of
the board

Number of
senior positions
on the board

Number in
executive
management

Percentage
of executive
management

100%

White British or
other White
(including
minority-white
Groups)

Mixed/Multiple
Ethnic Groups

Asian/Asian British

Black/African/
Caribbean/
Black British

Other
ethnic group,
including
Arab

Ethnicity 2023

84%

White

Ethnic Minority

Directors

Subsidiary Directors and Senior
Managers other than Directors
of the company.

Other employees of the Group

14% of employees are of ethnic minority there has been
no change since 2022.

The Group consults with its employees regularly
through direct updates and during the year has conducted
multiple surveys and an annual review of staff; all results
are reviewed and discussed by the directors and an action
plan agreed and discussed with all staff. The Group invests
in training and developing its employees through both
internal and external courses.

The Group follows the legislative requirements set out in the
Equality Act 2010 which covers all aspects of equality and
diversity, replacing previous legislation covering equal pay,
sex, race and disability discrimination. The Group gives due
consideration to all applications and provides training and
the opportunity for career development wherever possible.
The board is also mindful of the Human Rights Act 1998.
Further work continues to be done through the employee led
ESG group holding the Board accountable for its policies on
equality and diversity.

Approved by the Board
and signed on its behalf.

–
Dr Fiona Underwood –
CEO
30 June 2023

Going concern basis

The Board updates its financial plan annually.
This includes a review of the Group and Company’s
cash flows and other key financial ratios over the
period. These metrics are subject to sensitivity
analysis which involves flexing a number of the
main assumptions underlying the forecast, both
individually and in unison. Where appropriate,
this analysis is carried out to evaluate the potential
impact of the company’s principal risks. The review
also makes certain assumptions about the normal
level of capital investment likely to occur and
considers whether additional financing facilities
will be required. The Group has no borrowings
and there is no plan to access additional funding.

The Directors are confident that the Group and
Company remains strong and viable with adequate
financial resources together with long standing
relationships with its clients and a diverse portfolio
of contracts. The main costs to the business are
staffing costs which are monitored regularly to
ensure profitability.

Based on the results of these analyses,
continuous monitoring of the sales invoices,
cash generation and cash balances, the Directors
have a reasonable expectation that the Group
and Company will be able to continue in operation
and meet its liabilities as they fall due in the next
twelve months thus they continue to adopt the going
concern basis of accounting in preparing the annual
financial statements.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202334
34

Directors’ Report

35
35

Directors’ report
The Directors present their report and consolidated
financial statements for the year ended 31 March 2023.

Aquila Services Group plc is incorporated as a public limited company and is registered in
England and Wales with the registered number 08988813. Details of the Company’s issued
share capital, together with the details of the movements during the year are shown in note 17.
The Company has one class Ordinary share which carries no right to fixed income. Each share
carries the right to one vote at general meetings of the Company. Details of employee share
schemes are set out in note 20.

The Board’s assessment of the performance of the Group, its future developments and
the principal risks and uncertainties affecting the group, together with the mitigating factors,
are presented in the Strategic report on pages 12 to 33.

Principal activities

Directors

The following served as directors of the Company
during the period or thereafter:

The principal activities of the Group are the
provision of specialist housing, sport, charity,
educational and treasury management consultancy
services. The principal activity of the Company is
that of a holding company which manages the
Group’s strategic direction.

Results

The results for the Group for the year ended
31 March 2023 are set out from page 59.

–
Derek Joseph –
Non-Executive Chair

–
Dr Fiona Underwood –
Chief Executive Officer

Dividend

The directors propose a final dividend of 0.5p
per share for the year end (2022: 0.4p). The total
dividend for the year was 0.75p per share (0.25p
was paid as an interim dividend in December 2022)
this compares to a total dividend of 0.6p per share
in 2022.

–
Claire Banks –
Group Finance Director
and Company Secretary

–
Richard Wollenberg –
Non-Executive Director

Annual report and financial statements for the year ended 31 March 2022

Aquila Services Group plc

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202336

Directors’ Report

37
37

Substantial shareholdings

As at 31 March 2023, the Company was aware of the following notifiable interests in its voting rights:

Number of
Ordinary shares

Percentage of
voting rights

Nature of
holding

Richard Wollenberg*

Derek Joseph

Fiona Underwood**

Susan Kane

Chris Wood

The estate of the late Steven Douglas

Jeffrey Zitron

Matt Carroll

Hannah Breitschadel

Mark Walker

Adam Walker

4,563,406

3,545,408

3,479,440

3,279,440

3,182,440

2,913,435

2,798,403

1,277,229

1,307,229

1,296,239

1,248,176

*Includes shares held by immediate family members of Richard Wollenberg
**Includes shares held by persons closely associated with Fiona Underwood

The Company is not aware of any changes to the above
holdings between 31 March 2023 and the date of this report.

11.42%

8.87%

8.71%

8.21%

7.96%

7.29%

7.00%

3.20%

3.27%

3.24%

3.12%

Direct

Corporate Governance
Statement

The Directors’ Report incorporates the Corporate
Governance Statement set out on pages 38 to 43.

Powers of Directors

Subject to the Company’s Articles of Association,
UK legislation and any directions given by special
resolution, the business of the Company is managed
by the board of Directors. Details of the matters
reserved for the board can be found in the
Corporate Governance Statement on pages
38 to 43.

Post balance sheet events

There are no post balance sheet events.

Political donations

The Group/Company made no
political donations during the period.

Data protection

The Group/Company is compliant
with the Data Protection Act 1998.

Greenhouse gas emissions

The Group/Company has minimal greenhouse
gas emissions to report from the operations of
the Company and its subsidiaries and does not
have responsibility for any other emission producing
sources under the Companies Act 2006 (Strategic
Report and Directors’ Report) Regulations 2013.
The Group achieved Carbon Neutral Plus status
for the year ended March 2022, the results of
which are published on the Company website.
Further disclosure is provided in the Strategic
report under the TCFD.

Auditor

Crowe U.K. LLP appointed as auditors on 12 March
2019 have expressed their willingness to remain in
office as auditor and, in accordance with section 489
of the Companies Act 2006, a resolution that Crowe
U.K. LLP be re-appointed will be proposed at the
Annual General Meeting.

Auditor information

The directors who held office at the date of
approval of the Report of the Directors confirm that,
so far as they are each aware, there is no relevant
audit information of which the Group’s auditor is
unaware; and each director has taken all the steps
that they ought to have taken as a director to make
themselves aware of any relevant audit information
and to establish that the Group’s auditor is aware of
that information.

Annual report and financial statements for the year ended 31 March 2022

Aquila Services Group plc

–
Dr Fiona Underwood
– CEO
By order of the Board
30 June 2023

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202338

Corporate Governance Statement

Corporate governance statement
The Directors acknowledge the importance of good corporate
governance and has formally adopted the 10 principles of the Quoted
Companies Alliance Code (QCA).

The statement below, together with the report on
directors’ remuneration on pages 34 to 51, explains
how the Company has observed principles set out
in the QCA code as relevant to the company and
contains the information required by section 7 of the
Financial Conduct Authority’s Disclosure Guidance
and Transparency Rules.

In compliance with S172 of Companies Act 2006,
the Board recognises the importance of engagement
with its stakeholders and the link this has to the long-
term success of the Group. Through the discussions,
presentations and reviews held at the board
meetings throughout the year, the Board is able to
ensure that the Group maintains an effective working

relationship with a wide range of stakeholders as
well as its shareholders. Updates from directors of
the subsidiaries and senior leaders across the Group
provide the Board with a greater understanding of
the operation of the Group.

At the date of the report the composition of the
boards can be seen on page 6.

The Group commits to engage with employees and
will continue to create further employee led groups
as required.

The structure of the board and committees and their
respective responsibilities are detailed as follows:

Board governance framework

At the date of this report the Board comprises
of the Chairman, two Executive Directors and
one Non-Executive Director.

The QCA code states that normally boards will
include at least two NED’s who are identified as
independent. The Group Board has one NED
who acts as a sounding board to the Chair and
the two Executive Directors. The board succession
plan is on going and the Group board continue
to review the positions.

The Group Board has primary
responsibility for:

•

Providing leadership for the Group

• Overseeing the overall strategic development of
the Group and approving the strategy to achieve
the Group’s strategic aims

•

Setting the Group’s values and standards

Ensuring effective governance and
risk management and that the Group’s
businesses act ethically and that obligations
to Shareholders are understood and met

• Delegating the management of the

day-to-day operation of the business to
the subsidiary boards

The Group board met seven times during the year.

Matters reserved to the Board

Remuneration Committee

The Board has adopted a formal schedule of matters
specifically reserved to it for decision-making.

The primary responsibilities of the Remuneration
Committee are:

A full schedule of matters reserved for the Board’s
decision along with the Terms of Reference of the
Board’s principal committees can be found on the
Company’s website.

Audit Committee

•

Setting the remuneration policy for executive
and non-executive directors, including pension
and compensation payments. No-one can be
involved in their own remuneration process;

Recommending and monitoring the level and
structure of senior management remuneration;

Reviewing the ongoing relevance
of remuneration policy;

The primary responsibilities of the Audit Committee
are to:

• Approving and determining targets for
any performance-based pay schemes;

•

Ensuring contractual terms of termination
are fair; and

• Overseeing any major change in

employee benefits.

The Remuneration Committee met once
during the year.

It’s members are: Derek Joseph and Richard
Wollenberg. The report of the Remuneration
Committee is set out on pages 43 to 51 of this report.

• Monitor the financial reporting for the annual
and half-yearly reports, challenging where
necessary to ensure appropriate accounting
standards have been met;

•

Review the internal controls and risk
management systems;

Review the compliance, whistle blowing and
fraud policies for the organisation;

• Make recommendations to the Board and

shareholders in relation to the appointment,
reappointment and removal of the external
auditors; and

• Meet regularly with the external auditor, review
and approve the annual audit plan and review
the findings of the audit with the external auditor.

The Audit Committee met twice in the year. Its
members are: Derek Joseph, Richard Wollenberg
and Fiona Underwood.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202340

Corporate Governance Statement

Nominations Committee

Subsidiary Boards

Attendance at Boards

The primary responsibilities of the Nominations
Committee are to:

The key responsibilities of the subsidiary
boards are to:

•

Regularly review the structure, size and
composition (including the skills, knowledge,
experience and diversity) of the board;

•

Be responsible for the day-to- day management
of the relevant subsidiary

• Oversee the development and implementation

• Consider succession planning for directors and

of the Group’s strategy

other senior executives;

•

Keep under review the leadership needs of the
organisation, both executive and non-executive;

Identify and nominate, for the approval of the
board, candidates to fill the board vacancies as
and when they arise; and

Evaluate the balance of skills,
knowledge, experience and diversity on
the board before any appointment is made
by the board, and, in the light of this, prepare a
description of the role and capabilities required
for a particular appointment.

The Nominations Committee, in conjunction
with Board meetings, met once during the
financial year. Its members are Derek Joseph
and Richard Wollenberg.

•

Implementation of Group policies

• Monitor risks and ensure mitigation strategies

are in place

• Monitor financial and operational performance
of the relevant subsidiary and other specific
matters delegated to them by the Group Board.

ESG Group

The ESG Group are responsible for overseeing
climate risk assessments and other aspects of
Aquila’s sustainability and ESG agenda and
reporting to the Group Board.

The ESG Group meet monthly and report to the
Group board quarterly. The Board is updated on
progress against targets regularly.

Director

Total number of meetings

Derek Joseph

Richard Wollenberg

Fiona Underwood

Claire Banks

Board Directors

Board

Audit
Committee

Remuneration
Committee

Nomination
Committee

Mr Wollenberg acts as a sounding board for the
chair and as an intermediary to other directors and
shareholders. Although Mr Wollenberg is a major
shareholder he continues to offer constructive
challenge, strategic guidance and holds
management to account. Derek Joseph continues
to assist the Group in developing the international
business and is remunerated for these consultancy
services. In the year to 31st March 2023, these totalled
£17k. (2022: £23k).

Derek Joseph is a director of AssetCore. Both
Derek Joseph and Richard Wollenberg are
shareholders of AssetCore, in which the Group
has a 5.3% shareholding.

The Board meets regularly with senior staff
throughout the year to discuss areas of
operational performance, trading outlook and
growth opportunities. This replaces the requirements
within The Code which requires a director appointed
from the workforce or a formal advisory workforce
advisory panel.

The Board is responsible for the Company’s
systems of Corporate Governance and comprises:

Derek Joseph – Non-Executive Chair. Derek
possesses a wealth of housing sector experience.
During his executive and non-executive career,
Derek has advised and project managed for
European governments and cities, UK government
departments, local authorities, housing associations,
commercial property companies, investors and
financial institutions, in addition to structuring joint
ventures for numerous organisations.

Richard Wollenberg – Non-executive Director.
Richard has, over the past 25 years, been actively
involved in numerous corporate acquisitions, mergers
and capital reorganisations of public and private
companies, very many of which were in the services
sector. He was an investment consultant and has
considerable experience and an excellent track
record of admitting investment vehicles to the market.

Fiona Underwood – Executive Director and
Group Chief Executive Officer. Fiona has
experience in building and running consultancy
businesses, having previously led a large consulting
business within a listed company. She is experienced
in mergers and acquisitions and corporate
governance, both in the private and the
not-for-profit sector.

Claire Banks – Group Finance Director and
Company Secretary. Claire is a Fellow Chartered
Accountant and has significant accounting,
finance and corporate experience within the
consulting sector.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023
42

Corporate Governance Statement

Directors’ Remuneration Report

Composition, succession and
evaluation

The work of board composition and succession
is undertaken by the nominations committee.

During the year ended 31 March 2023, the Board
did not undertake a board evaluation.

Relations with shareholders

The Group reports formally to shareholders when
its annual and half-yearly financial statements are
published. Presentations are given to investors when
requested, normally following the publication of the
full year results, when interim and annual reports are
sent to all shareholders. The results of such meetings
are discussed with board members. All directors are
present at the Annual General Meeting.

Audit risk and internal control

The Audit Committee, which is chaired by Richard Wollenberg, comprises the Non-Executive Chair,
Non-Executive Director and Chief Executive Office. The Board is satisfied that Richard Wollenberg has
recent and relevant financial experience to guide the committee in its deliberations and that Derek Joseph
and Fiona Underwood have the relevant sector experience.

The committee meet with the external auditor to consider the results, internal procedures and controls,
and matters raised by the auditor. The Audit Committee considers auditor independence and objectivity
and the effectiveness of the audit process. It also considers the nature and extent of the non-audit services
supplied by the auditor reviewing the ratio of audit to non-audit fees. It is a specific responsibility of the Audit
Committee to ensure that an appropriate relationship is maintained between the company and its external
auditor. The Company has a policy of controlling the provision of non-audit services by the external auditor
in order that their objectivity and independence are safeguarded. This control is exercised by ensuring non-
audit projects where all fees are subject to the prior approval of the audit committee.

As part of the decision to recommend to the Board the re-appointment of the external auditor, the committee
considers the tenure of the auditor in addition to the results of its review of the effectiveness of the external
auditor and considers whether there should be a full tender process. There are no contractual obligations
restricting the committee’s choice of external auditor.

Internal financial controls have been established to provide safeguards against unauthorised use or
disposition of the assets, to maintain proper accounting records and to provide reliable financial information
for internal use. Key financial controls include:

•

keeping adequate accounting records;

a schedule of matters reserved for the approval of the Board; and

evaluation, approval procedures and risk assessment for acquisitions.

The Board has considered the size of the Group and the close involvement of executive directors in the
day-to-day operations and deems the internal audit function unnecessary. The Board will continue to
monitor this situation.

The Group’s operations are conducted in accordance with the provisions of laws and regulations,
including compliance with the provision of laws and regulations central to the FCA.

Directors’ remuneration report
The information provided on this page of the Directors’
remuneration report is not subject to audit.

The report is split into three main areas:

•
Statement from the Chair
• Annual Report on Remuneration
•

Policy Report

The Remuneration Committee is chaired by Richard
Wollenberg (Non-Executive) and comprises Richard
Wollenberg and Derek Joseph (Chair).

Statement of implementation of
remuneration policy in the following year

The Remuneration Committee proposes to amend the remuneration policy that was approved
by the shareholders at the 2020 annual general meeting. The changes to the policy are detailed
in the table on page 48 to 49.

The policy is available for review on the Company’s website.

Statement from the Chair

I am pleased to present the Annual Report on Remuneration for the year ended 31 March 2023.

The Remuneration Committee has used the remuneration policy to specifically link the
performance of the Group as a framework to set remuneration levels. Executive directors
do not participate in decisions regarding their own remuneration. The committee has access
to independent advice but during the year under review they have not sought such advice.

In setting the company’s remuneration policy for directors, the Remuneration Committee has
considered the best practice provisions annexed to The Financial Conduct Authority’s Listing
Rules and the report has been prepared in accordance with Chapter 6 of the Companies Act
2006 and the Directors’ Remuneration Report Regulations 2013 and The Code.

The Remuneration Committee met twice during the year to discuss the executive directors’
remuneration, including bonus and share option awards.

The remuneration policy is designed to attract and retain executive directors and to motivate
them in delivering the objectives of the Company. The underlying principle is that employee and
director share ownership is encouraged, and the remuneration policy provides opportunity to
reward employees who have met their financial targets and contributed to the wider success of
the business. The award of share options may also be a consideration. This links their personal
interest to the success of the company.

–
Richard Wollenberg
- Chair of the
Remuneration
Committee
30 June 2023

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202344

Directors’ Remuneration Report

The information provided on pages 44 to 48 of the Directors’ Remuneration Report relating to
Executive and Non-Executive remuneration, incentive schemes and share options is subject to audit.

Non-executive directors’ remuneration payable as a single figure (2023)

Richard Wollenberg

Derek Joseph**

Salary

and fees Benefits*

Annual
bonuses

LTIP

Pension

Total

4,000

27,138

31,138

4,000

27,138

31,138

Non-executive directors’ remuneration payable as a single figure (2022)

Richard Wollenberg

Derek Joseph**

Salary

and fees Benefits*

Annual
bonuses

LTIP

Pension

Total

4,000

33,061

37,061

4,000

33,061

37,061

Annual report on remuneration

Director changes

The directors followed the remuneration policy
agreed at the AGM in 2020. The original version of
the policy is set out in the 2020 annual report and is
available on the Company’s website.

There were no changes during the year under review.

Executive directors’ remuneration payable as a single figure (2023)

Fiona Underwood

Claire Banks

Salary

and fees Benefits*

Annual
bonuses

LTIP

Pension

Total

175,000

113,000

1,147

20,000

993

6,000

288,000

2,140

26,000

10,500

206,647

6,798

126,791

17,298

333,438

Executive directors’ remuneration payable as a single figure (2022)

Fiona Underwood

Claire Banks

Salary

and fees Benefits*

Annual
bonuses

LTIP

Pension

Total

170,000

110,000

1,595

1,243

5,000

280,000

2,838

10,000

10,200

186,795

6,600

122,843

16,800

309,638

*Benefits include private medical insurance
**Included within the fees for Derek Joseph are £17k (2021: £23k) of consultancy fees.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202346

Directors’ Remuneration Report

Executive Incentive Scheme

The scheme, which is discretionary for executive
group board directors, is dependent on the
performance target for the year, as set out in
the remuneration policy. The scheme comprises
two elements:

1. An unconsolidated bonus award of up to 30%

of basic salary, this is made up of a personal
target of up to 20% and 10% on Group profit
targets, and

2. A share option award of up to 30% of salary
(based on the mid-market share price on
the date the accounts are signed) which
forms part of the long-term incentive plan
(LTIP) of the scheme.

Service contracts of
executive directors

All executive directors have a service contract.
The contract can be terminated by either party upon
giving six months’ notice in writing. The contracts are
available for inspection at the company’s offices.

Payments to past directors

In the year ended 31 March 2023, there were no
payments to past directors.

Payments for loss of office

No payments were made to directors for loss
of office in the year ended 31 March 2023.

2022-23 award

Remuneration committee assessed the performance
of the group executive directors against the target
and the committee’s decision is shown below.

Target
Performance1

Actual
Performance

Maximum
Possible award

2022-23
Unconsolidated
bonus award-
Executive
Director

2022-23
Unconsolidated
bonus award –
Group Finance
Director

Cash based
award

Share option
award

£799k

£806k

£799k

£806k

£53k

£20K

£Nil

£6k

£Nil

The committee believes that the reward payable is a fair reflection of the performance over the year.

Statement of directors’ shareholding and share interest

The total number of directors’ interests in shares and the total number of share options in
relation to each director with and without performance measures, those vested but unexercised,
and those exercised, is set out below:

Interest in share options

Number of
ordinary
shares

With
performance
measures

Without
performance
measures

Vested but
unexercised

Exercised
during the
year

Richard Wollenberg2

4,563,406

Derek Joseph

Fiona Underwood3

Claire Banks

3,545,408

3,479,440

48,315

50,000

100,000

275,050

77,315

The information provided on pages 48 to 51 of the Directors’ Remuneration Report is
not subject to audit.

Relative importance of spend on pay

A comparison of shareholder distributions and total employee expenditure of the Group is set
out below for the years ended 31 March 2022 and 31 March 2023.

All employees remuneration

Total dividend per share

Distributions to shareholders

2023

£’000

7,180

0.75p

260

2022

£’000

5,879

0.60p

240

Change

21%

25%

19%

1 2021-22 Underlying operating profit plus 10%

2 Includes shares held by immediate family members of Richard Wollenberg
3 Includes shares held by persons associated with Fiona Underwood

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202348

Directors’ Remuneration Report

Gender pay gap report

The Group is not required by law to report on its
gender pay figure but recognises the importance
of openness and transparency; as part of the work
undertaken by the Employee led EDI group this data
will be published on the Group’s website.

Consideration by the
directors of matters relating
to directors’ remuneration

No advice or services were given that materially
assisted the committee in their consideration of the
remuneration policy.

Employees

The Group is committed to creating an environment
where its staff feel engaged and motivated in their
roles. It is, by default, a learning organisation where
people can gain new knowledge, skills and experience
through the work that they deliver. It also offers staff
learning and development opportunities and the
chance to communicate their views through the
annual staff survey. The results of which are actively
considered by the directors and leadership team.

The Group ensures that it complies with its legislative
requirements in relation to employment law.

Shareholder voting at the last
general meeting

The Group is committed to on-going shareholder
dialogue and takes an active interest in voting
outcomes. Where there are substantial votes against
resolutions in relation to directors’ remuneration, the
reasons for any such vote will be sought, and any
actions in response will be detailed here.

The Directors’ Remuneration Report for the year
ended 31 March 2022 was approved by shareholders
at the Annual General Meeting held on 28 July 2022.
The Directors’ Remuneration Policy was approved by
shareholders at the Annual General Meeting held on
29 July 2020.

Directors’ Remuneration
Report (2022 Annual
General Meeting)

% of votes
cast

Directors’ Remuneration
Report (2021 Annual
General Meeting)

% of votes
cast

For

Against

Abstention

100%

For

Against

Abstention

Total votes cast

100%

Total votes cast

93%

100%

Policy Report

Implementation of remuneration policy in the
following year.

The remuneration committee intend to update
the remuneration policy to be approved at the
AGM on 26 July 2023 for implementation for the year
ended 31 March 2024. The proposed changes are
set out to the right.

Future policy table

The following tables provides a summary of the
key components of the remuneration package for
executive directors:

Salary

Benefits

Pensions

Annual bonus

Share Options

Summary of
approach

Performance
criteria

Change from
Previous policy

To provide competitive
fixed elements of reward.
Salaries are reviewed
annually or when an
individual changes
position or responsibility.

To provide a range of cost-
effective benefits which
are in-line with the market.
Benefits include:

•

Private Medical
Insurance
Permanent Health
Insurance
Life Insurance

Pension benefits are
provided through a Group
personal pension plan at
6% of salaries.

Assessment of
personal and
corporate performance.

None

To incentivise and
reward for achievement
of in-year objectives
linked to the performance
of the individual and the
Group up to 30% of their
annual salary.

Up to 10% based on
personal objectives
as agreed by the
remuneration committee.
An additional 20% based
on the performance of
the Group.

None

Awards of share
options are made
subject to an annual
profit performance period.
The maximum award
is 200,000 options per
individual per financial
year.

Share options are
awarded for Group
performance in excess
of 5% year on year and
are at the discretion of the
remuneration committee.

The maximum award is
amended from 30% of
salary to a maximum of
200,000 share options
per individual per
financial year.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202350

Directors’ Remuneration Report

Statement of consideration of
employment conditions elsewhere
in the Group

The committee has not consulted with its
employees on executive pay but is aware of the pay
and employment benefits across the wider Group.
The personal performance element of the annual
bonus for executive directors has been aligned
with that of other subsidiaries across the Group.
At the discretion of the remuneration committee share
options may be awarded to employees across the
Group for exceptional performance.

Statement of consideration
of shareholder views

The committee will consider shareholder feedback
received at the AGM and subject to any restrictions
during meetings with shareholders throughout
the year and will use these views to formulate
any changes to the remuneration policy.

–
Richard Wollenberg
- Chair of the
Remuneration
Committee
30 June 2023

Approach to recruitment remuneration

The committee’s approach to recruitment is to offer a market competitive remuneration package
sufficient to attract high calibre candidates who are appropriate to the role but without paying
any more than is necessary.

Any new executive director’s remuneration would include the same elements and be in line with
the policy set out in this report.

Performance graph of total shareholder return

The following graph shows the Company’s performance since flotation, measured by total
shareholder return, compared with the performance of the FTSE All Share Index also measured
by total shareholder return. Aquila operates in a niche sector with very few comparisons and as
such the directors believe that the FTSE All Share Index provides the best measure on which to
assess the directors’ performance.

Data source: London Stock Exchange

Policy on payment for loss of office

Payments for loss of office would be determined by the remuneration committee taking
into account contractual obligations. The contractual obligations relate only to payments
in lieu of notice.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202352

Statement of Directors’ Responsibilities

Independent Auditors’ Report to the Members

Independent Auditor’s Report to the Members
of Aquila Services Group plc

Opinion

Basis for opinion

We conducted our audit in accordance with
International Standards on Auditing (UK) (ISAs
(UK)) and applicable law. Our responsibilities
under those standards are further described in the
Auditor’s responsibilities for the audit of the financial
statements section of our report. We are independent
of the Group and Company in accordance with the
ethical requirements that are relevant to our audit
of the financial statements in the UK, including the
FRC’s Ethical Standard as applied to listed public
interest entities, and we have fulfilled our other
ethical responsibilities in accordance with these
requirements. We believe that the audit evidence
we have obtained is sufficient and appropriate to
provide a basis for our opinion.

We have audited the financial statements of
Aquila Services Group plc (the “Company”)
and its subsidiaries (the ‘Group’) for the year
ended 31 March 2023 which comprise the
Consolidated Statement of Comprehensive
Income, the Consolidated and Company
Statements of Financial Position, the Consolidated
and Company Statement of Changes in Equity,
the Consolidated and Company Statement of
Cash Flows and notes to the financial statements,
including a summary of significant accounting
policies. The financial reporting framework that
has been applied in the preparation of the group
financial statements is applicable law and UK-
adopted international reporting standards and,
as regards the Company financial statements, as
applied in accordance with the provisions of the
Companies Act 2006.

In our opinion:

•

the financial statements give a true and fair
view of the state of the Group’s and of the Parent
Company’s affairs as at 31 March 2023 and of
the Group’s profit for the year then ended;

the financial statements have been properly
prepared in accordance with UK-adopted
international reporting standards; and

the financial statements have been prepared
in accordance with the Companies Act 2006.

Statement of Directors’ Responsibilities in respect
of the Annual Report and the Financial Statements
The directors (whose names and functions are set out on page 35)
are responsible for preparing this report and the financial statements
in accordance with applicable law and regulations.

Company law requires the directors to prepare
financial statements for each financial year.
Under that law the directors have prepared
the Company and Group financial statements
in accordance with UK Adopted International
accounting standards in conformity with the
requirements of the Companies Act 2006.
Under company law, the directors must not approve
the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of
the Company and the Group and the profit or loss of
the Company and the Group for that period.

In preparing the Company and Group financial
statements, the directors are required to:

•

Select suitable accounting policies and then
apply them consistently;

from material misstatement. Whether due to fraud or
error and have general responsibility for taking such
steps as are reasonably open to them to safeguard
the assets of the Group and to prevent and detect
fraud and other irregularities.

Under applicable law and regulations. the Directors
are also responsible for preparing a Strategic Report.
Directors’ Report and Corporate Governance Report
that comply with that law and those regulations.

The Directors are responsible for the maintenance
and integrity of the corporate and financial
information included on the Company’s website.
Legislation in the UK governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.

• Make judgements and estimates that are

reasonable relevant and reliable;

Responsibility statement of the Directors in respect
of the Annual Report and Financial Statements

•

Present information, including accounting
policies, in a manner that provides relevant,
reliable, comparable and understandable
information;

State whether they have been prepared in
accordance with UK-adopted international
accounting standards in conformity with the
requirements of the Companies Act 2006;

Prepare the financial statements on the going
concern basis unless it is inappropriate to
presume that the Company and Group will
continue in business; and

• Use the going concern basis of accounting

unless they either intend to liquidate the Group
or the Company or cease operations or have no
realistic alternative but to do so.

The Directors are responsible for maintaining
adequate accounting records that are sufficient to
show and explain the Company’s transactions and
disclose with reasonable accuracy at any time the
financial position of the Company and enable them
to ensure that the financial statements comply with
the Companies Act 2006.

The directors are responsible for such internal
controls as they determine are necessary to enable
the preparation of financial statements that are free

We confirm that to the best of our knowledge:

•

the Company and Group financial statements,
which have been prepared in accordance with
the applicable set of accounting standards,
give a true and fair view of the assets, liabilities,
financial position and profit or loss of the
Company and the undertakings included in the
consolidation taken as a whole; and

the Strategic Report and Directors’ Report
include a fair review of the development and
performance of the business and the position
of the Group and the undertakings included in
the consolidation taken as a whole. together
with a description of the principal risks and
uncertainties that they face.

We consider the Annual Report and
Financial Statements, taken as a whole,
is fair, balanced and understandable and
provides the information necessary for shareholders
to assess the Group’s position and performance,
business model and strategy.

–
Claire Banks – Group
Finance Director
On behalf of the Board
30 June 2023

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202354

Independent Auditors’ Report to the Members

Conclusions relating
to going concern

Overview of our
audit approach

In auditing the financial statements, we have
concluded that the directors’ use of the going
concern basis of accounting in the preparation of the
financial statements is appropriate. Our evaluation
of the directors’ assessment of the Group and Parent
Company’s ability to continue to adopt the going
concern basis of accounting included the following:

•

obtaining management’s going concern
assessment and challenging, where appropriate,
the assumptions used;

testing the mathematical accuracy of the models
used by management in their assessment;

considering the reasonableness of those models,
including comparison to actual results achieved
in the year and the evaluation of downside
sensitivities; and

discussing with management and evaluating
their assessment of the Group and the
Company’s liquidity requirements.

Based on the work we have performed, we have
not identified any material uncertainties relating to
events or conditions that, individually or collectively,
may cast significant doubt on the company’s ability to
continue as a going concern for a period of at least
twelve months from when the financial statements are
authorised for issue.

Our responsibilities and the responsibilities of the
directors with respect to going concern are described
in the relevant sections of this report.

Scope of our audit
The group comprises the Parent Company and its
wholly-owned subsidiaries, all of which are based in
the UK and audited by the group audit team.

Materiality
In planning and performing our audit we applied
the concept of materiality. An item is considered
material if it could reasonably be expected to change
the economic decisions of a user of the financial
statements. We used the concept of materiality to
both focus our testing and to evaluate the impact of
misstatements identified.

Based on our professional judgement, we determined
overall materiality for the Group financial statements
as a whole to be £55,000 (2022: £50,000), based on
7% of normalised profit before tax. Materiality for the
Parent Company as a whole was set at £49,500 (2022:
£45,000), based on approximately 1% of the parent
company’s total assets.

We use a different level of materiality (‘performance
materiality’) to determine the extent of our testing for
the audit of the financial statements. Performance
materiality is set based on the audit materiality as
adjusted for the judgements made as to the entity
risk and our evaluation of the specific risk of each
audit area having regard to the internal control
environment. Performance materiality was set at
70% of materiality for the financial statements as a
whole, which equates to £38,500 (2022: £35,000)
for the group and £34,650 (2022: £31,500) for the
parent company. We applied this percentage in our
determination of performance materiality because
we did not identify any factors indicating an elevated
level of risk.

We agreed with the Audit Committee to report to it
all identified misstatement in excess of £2,500 (2022:
£2,500). Errors below that threshold would also be
reported to it if, in our opinion as auditor, disclosure
was required on qualitative grounds.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial statements of the current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) that we identified. These matters included those which had the
greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts
of the engagement team. These matters were addressed in the context of our audit of the financial statements
as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

We set out below those matters we identified as key audit matters. This is not a complete list of all risks identified
by our audit.

Key audit matter
Carrying value of goodwill (Group)
and investments in subsidiaries (Parent company)

Accounting policies (Note 2) and Notes 10
and 12 of the financial statements

At 31 March 2023, the group has goodwill with a
carrying value of £3,197,000 attributable across
three different cash generating units, ATFS,
Oaks and Altair.

In carrying out impairment reviews, management
use assumptions and estimates of future trading
performance of the cash generating units. The
significant assumptions include forecast revenues,
gross margin, future overheads and the discount rate.

Management has disclosed the results of its
sensitivity analysis in Note 10.

This matter was considered a key audit matter due
to the extent of audit effort and judgement required
to assess the reasonableness of the forecast
cashflows, growth rates, discount rates and terminal
growth rates used by the Group in undertaking the
impairment review.

How the scope of our audit addressed
the key audit matter
We obtained management’s assessment
of the basis for the recognition and carrying
value of goodwill with particular focus on
current performance, key assumptions used
and the suitability and integrity of the underlying
valuation model.

Using management’s model we considered how
sensitive the impairment assessment was by applying
alternative assumptions and compared the results
to those from management. This assisted us in
understanding the conditions when an impairment
would need to be recognised. We also considered
actual results against management forecasts from
prior years.

We challenged management on the assumptions
used for future trading, particularly for the ATFS
model. Following our challenge, Management has
recognised an impairment in respect of the goodwill
in ATFS.

As a consequence, Management also recognised an
impairment in the carrying value of the investment in
ATFS in the Parent company financial statements.

We have concluded that Management has
made an appropriate impairment against the
goodwill in ATFS and the Parent company’s
investment in that subsidiary.

Our audit procedures in relation to these matters were designed in the context of our audit opinion as a whole.
They were not designed to enable us to express an opinion on these matters individually and we express no
such opinion.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023
56

Independent Auditors’ Report to the Members

Other information

The directors are responsible for the other information contained within the annual report.
The other information comprises the information included in the annual report, other than the financial
statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly stated in our report, we do not express any form of
assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information
is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise
appears to be materially misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise to a material misstatement in the financial
statements. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters
prescribed by the Companies
Act 2006

Matters on which we
are required to report
by exception

In our opinion the part of the directors’ remuneration
report to be audited has been properly prepared in
accordance with the Companies Act 2006.

In our opinion based on the work undertaken in the
course of our audit

•

the information given in the strategic report and
the directors’ report for the financial year for
which the financial statements are prepared is
consistent with the financial statements; and

the strategic report and the directors’ report
have been prepared in accordance with
applicable legal requirements

In the light of the knowledge and understanding of
the Group and the Company and its environment
obtained in the course of the audit, we have not
identified material misstatements in the strategic
report or the directors’ report.

We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:

•

adequate accounting records have not been
kept by the Company, or returns adequate for
our audit have not been received from branches
not visited by us; or

the Company financial statements and the
part of the directors’ remuneration report
to be audited are not in agreement with the
accounting records and returns; or

certain disclosures of directors’ remuneration
specified by law are not made; or

• we have not received all the information and

explanations we require for our audit

Responsibilities of the directors
for the financial statements

As explained more fully in the directors’ responsibilities statement set out on page 43, the directors are
responsible for the preparation of the financial statements and for being satisfied that they give a true and
fair view, and for such internal control as the directors determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Group’s and the
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless the directors either intend to liquidate the Group or
the Company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

risks included enquiries of management about
their own identification and assessment of the risks
of irregularities, sample testing on the posting of
journals, reviewing accounting estimates for biases,
corroborating amounts recognised to supporting
documentation on a sample basis and ensuring
accounting policies are appropriate under the
relevant accounting standards and applicable law.

Owing to the inherent limitations of an audit, there is
an unavoidable risk that we may not have detected
some material misstatements in the financial
statements, even though we have properly planned
and performed our audit in accordance with auditing
standards. We are not responsible for preventing
non-compliance and cannot be expected to detect
non-compliance with all laws and regulations.

These inherent limitations are particularly
significant in the case of misstatement resulting
from fraud as this may involve sophisticated schemes
designed to avoid detection, including deliberate
failure to record transactions, collusion or the
provision of intentional misrepresentations.

A further description of our responsibilities for the
audit of the financial statements is located on the
Financial Reporting Council’s website at: www.frc.
org.uk/auditorsresponsibilities. This description forms
part of our auditor’s report.

Our objectives are to obtain reasonable assurance
about whether the financial statements as a whole
are free from material misstatement, whether due to
fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs (UK)
will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the
aggregate, they could reasonably be expected to
influence the economic decisions of users taken on
the basis of these financial statements.

Irregularities, including fraud, are instances of non-
compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect of
irregularities, including fraud. The extent to which our
procedures are capable of detecting irregularities,
including fraud is detailed below:

We obtained an understanding of the legal and
regulatory frameworks within which the company
operates, focusing on those laws and regulations
that have a direct effect on the determination of
material amounts and disclosures in the financial
statements. The laws and regulations we considered
in this context were the Companies Act 2006, FCA
Rulebook and taxation legislation.

We identified the greatest risk of material impact
on the financial statements from irregularities,
including fraud, to be the override of controls by
management, inappropriate revenue recognition
and judgement surrounding the carrying value of
goodwill. Our audit procedures to respond to these

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202358

Independent Auditors’ Report to the Members

Consolidated Statement of Comprehensive Income

Other matters which we are required to address

We were appointed by the Board on 21 March 2019 to audit the financial statements
for the year ending 31 March 2019 and subsequent periods. Our total uninterrupted period
of engagement is five years, covering the years ending 31 March 2019 to 31 March 2023.

The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the
Group’s or the Company and we remain independent of the Group’s and the Company in
conducting our audit.

Our audit opinion is consistent with the additional report to the audit committee.

–
Steve Gale - (Senior
Statutory Auditor)
For and on behalf of
Crowe U.K. LLP
55 Ludgate Hill
London
EC4M 7JW

30 June 2023

Use of our report

This report is made solely to the Company’s members, as a body, in accordance with Chapter
3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might
state to the Company’s members those matters we are required to state to them in an auditor’s
report and for no other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the Company and the Company’s members as
a body, for our audit work, for this report, or for the opinions we have formed.

Consolidated statement of comprehensive income
For the year ended 31 March 2023

Revenue

Cost of sales

Gross profit

Administrative expenses

Operating profit

Finance income

Impairment of Goodwill

Profit before taxation

Income tax expense

Profit for the year

Other comprehensive income

Total comprehensive income for the year

Earnings per share attributable
to owners of the parent

Basic

Diluted

Notes

2023
£’000

12,249

(9,644)

2,605

(1,828)

777

(120)

674

(156)

518

1.29p

1.26p

2022
£’000

10,119

(7,913)

2,206

(1,488)

718

(139)

579

1.45p

1.41p

The income statement has been prepared on the basis that all operations are continuing operations.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202360

Consolidated Statement of Financial Position

Company Statement of Financial Position

Consolidated statement of financial position
As at 31 March 2023

Company statement of financial position
As at 31 March 2023

Notes

Group
2023
£’000

Group
2022
£’000

Notes

Company
2023
£’000

Company
2022
£’000

Non-current assets

Goodwill

Property, plant and equipment

Investments

Current assets

Trade and other receivables

Cash and bank balances

Current liabilities

Trade and other payables

Lease liabilities

Corporation tax

Net current assets

Non-current lease liabilities

Net assets

Equity

Share capital

Share premium account

Merger reserve

Share-based payment reserve

Retained losses

Equity attributable to
the owners of the parent

3,197

234

3,502

3,130

2,405

5,535

2,260

170

2,499

3,036

126

6,412

1,998

1,712

3,042

364

(704)

6,412

3,317

313

3,701

2,593

2,193

4,786

1,917

144

2,149

2,637

196

6,142

1,998

1,712

3,042

415

(1,025)

6,142

The financial statements were approved by the board and authorised for issue on 30 June 2023.

Non-current assets

Property, plant and equipment

Investments in subsidiaries

Investments

Current assets

Trade and other receivables

Cash and bank balances

Current liabilities

Trade and other payables

Net current assets

Net assets

Equity

Share capital

Share premium account

Share-based payment reserve

Retained earnings

Equity attributable to
the owners of the parent

As permitted by S408 Companies Act 2006, the company has not
presented its own profit and loss account. The company’s profit for
the year was £103k (2022: loss £441k).

The financial statements were approved by the board and
authorised for issue on 30 June 2023.

4,072

4,155

236

1,052

1,288

694

594

4,749

1,998

2,341

364

4,180

4,254

991

1,080

440

640

4,894

1,998

2,341

415

140

4,749

4,894

–
Claire Banks – Group
Finance Director
Company Registration
No. 08988813

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202362

Consolidated Statement of Changes in Equity

Company Statement of Changes in Equity

Consolidated statement of changes in equity
For the year ended 31 March 2023

Company statement of changes in equity
For the year ended 31 March 2023

Share
Capital
£’000

Share
Premium
account
£’000

Merger
reserve
£’000

Share
based
payment
reserve
£’000

Retained
losses
£’000

Total
equity
£’000

Share
capital
£’000

Share
premium
account
£’000

Share
based
payment
reserve
£’000

Retained
earnings
£’000

Total
equity
£’000

Balance at 1 April 2021

1,998

1,712

3,042

580

(1,537)

5,795

Balance at 1 April 2021

1,998

2,341

Total comprehensive income

Transfer on reserves

Share based payment charge

Dividend

(173)

579

173

(240)

Balance at 31 March 2022

1,998

1,712

3,042

415

(1,025)

579

(240)

6,142

Total comprehensive income

Transfer on reserves

Share based payment charge

Dividend

Balance at 31 March 2022

1,998

2,341

415

Balance at 1 April 2022

1,998

1,712

3,042

415

(1,025)

6,142

Balance at 1 April 2022

1,998

2,341

Total comprehensive income

Transfer on reserves

Share based payment charge

Dividend

(63)

Balance at 31 March 2023

1,998

1,712

3,042

364

518

(260)

(704)

(260)

6,412

Total comprehensive income

Transfer on reserves

Share based payment charge

Dividend

Balance at 31 March 2023

1,998

2,341

364

580

(173)

415

(63)

648

(441)

173

(240)

140

103

(260)

5,567

(441)

(240)

4,894

103

(260)

4,749

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023
64

Consolidated Statement of Cash Flow

Company Statement of Cash Flow

Consolidated statement of cash flow
For the year ended 31 March 2023

Company statement of cash flow
For the year ended 31 March 2023

Cash flows from operating activities

2023
£’000

2022
£’000

Profit for the year

Interest received

Income tax expense

Share based payment charge

Impairment of goodwill

Depreciation

Operating cash flows before movement in working capital

(Increase)/Decrease in trade and other receivables

(Decrease)/Increase in trade and other payables

Cash generated by operations

Income taxes paid

Net cash inflow from operating activities

Cash flows from investing activities

Interest received

Purchase of property, plant and equipment

Net cash (outflow)/inflow from investing activities

Cash flows from financing activities

Lease liability payments

Dividends paid

Net cash (outflow)/inflow from financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents at beginning of the year

Cash and cash equivalents at end of the year

518

(17)

156

120

124

913

(537)

343

719

(130)

589

(45)

(28)

(89)

(260)

(349)

212

2,193

2,405

579

139

118

844

(320)

(12)

512

(84)

428

(37)

(85)

(240)

(325)

2,127

2,193

Profit/(Loss) for the year

Interest received

Dividends received

Impairment of investment

Depreciation

Operating cash flows before movement in working capital

Decrease/(Increase) in trade and other receivables

Increase/(Decrease) in trade and other payables

Cash (outflow) generated by operations

Net cash (outflow) from operating activities

Cash flows from investing activities

Interest on deposits

Purchase of plant and equipment

Dividends received

Net cash (outflow)/inflow from investing activities

Cash flows from financing activities

Dividends paid

Net cash (outflow) from financing activities

Net increase/(decrease) in cash and cash equivalents

Cash and cash equivalents at beginning of the year

Cash and cash equivalents at end of the year

2023
£’000

103

(17)

(977)

120

(765)

755

254

244

(15)

977

979

(260)

963

1,052

2022
£’000

(441)

(200)

(641)

313

(289)

200

203

(240)

(326)

415

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202366

Notes to the Financial Statements

Notes to the financial statements
For the year ended 31 March 2023

1. General information

Accounting policies

Aquila Services Group plc (‘the Company’) and
its subsidiaries (together, ‘the Group’) provide
specialist housing, sport, education and treasury
management consultancy services. The principal
activity of the Company is that of a holding company
for the Group as well as providing all the strategic
and governance functions of the Group.

The Company is a public limited company which
is listed on the London Stock Exchange, domiciled in
the United Kingdom and incorporated and registered
in England and Wales. The Company’s registered
office is Tempus Wharf, 29a Bermondsey Wall West,
London, SE16 4SA.

The principal accounting policies applied in
preparation of these consolidated financial
statements are set out below. These policies have
been consistently applied unless otherwise stated.

Basis of preparation
The financial statements have been prepared in
accordance with International Accounting standards
in conformity with the requirements of the Companies
Act 2006.

The financial statements have been prepared on the
historical cost basis except for certain assets which
are carried at fair value.

The financial statements are presented in Pounds
Sterling which is the functional and presentational
currency of all companies within the group.

The preparation of the financial statements in
conformity with IFRS 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 of critical
accounting estimates and judgements are set out in
note 3.

Going concern
The budgets and cashflow forecasts that have
been produced and reviewed demonstrate that the
Group is forecast to generate profits and cash in the
year ended 31 March 2023 and beyond and that the
Group has sufficient cash reserves to enable the
Group to meet its obligations as they fall due for a
period of at least 12 months from the date of signing
the financial statements.

Basis of consolidation
The consolidated financial statements incorporate
the financial statements of subsidiary entities. A
subsidiary is defined as an entity over which the
Company has control. Control is achieved when the
Company has power over an entity, is exposed to, or
has rights to, variable returns from its involvement with
the entity, and could use its power to affect its returns.

Consolidation of a subsidiary begins when the
Company obtains control and ceases when control
is lost. The Company reassesses whether it controls
an entity if facts and circumstances indicate that
there are changes to one or more of the three control
elements listed above.

All intragroup assets and liabilities, equity,
income, expenses and cash flows relating to
transactions between members of the Group
are eliminated on consolidation.

Time and materials assignments are recognised
as services are provided at the fee rate agreed
with the client. Unbilled revenue on individual
client assignments is classified as contract assets
for client work within trade and other receivables.
Where individual on-account billings exceed
recognised revenue on a client assignment, the
excess is classified as contract liabilities for client
work within trade and other payables.

Property, plant and equipment
Property, plant and equipment are stated at cost
less accumulated depreciation and any recognised
impairment loss. The cost of an item of property,
plant and equipment initially recognised includes
its purchase price and any cost that is directly
attributable to bringing the asset to the location
and condition necessary for use. Depreciation is
recognised to write-off the cost of assets less their
residual values over their estimated useful lives, using
the straight-line method, on the following bases:

Right of use assets
Over unexpired term of lease

Leasehold improvements
Over unexpired term of lease

Fixtures, fittings and equipment
3-4 years

The estimated useful lives, residual values and
depreciation method are reviewed at the end of
each reporting period, with the effect of any changes
in estimate accounted for on a prospective basis.

An item of property, plant and equipment is
derecognised upon disposal or when no future
economic benefits are expected to arise from the
continued use of the asset. The gain or loss arising
on the disposal of an asset is determined as the
difference between the sales proceeds and the
carrying amount of the asset and is recognised in
the statement of comprehensive income.

Where necessary, adjustments are made to the
financial statements of subsidiaries to bring
accounting policies used into line with the Group’s
accounting policies.

Business combinations
Acquisitions of subsidiaries are accounted
for using the acquisition method. The consideration
transferred in a business combination is measured
at fair value, which is calculated as the sum of the
acquisition date fair values of assets transferred
by the Group, liabilities incurred by the Group to
the former owners of the acquiree and the equity
interest issued by the Group in exchange for control
of the acquiree.

Any excess of the consideration over the fair value
of the identifiable assets and liabilities acquired is
recognised as goodwill. Goodwill is not amortised
but is reviewed for impairment at least annually.
If the consideration is less than the fair value of
the identifiable assets and liabilities acquired,
the difference is recognised in the statement of
comprehensive income.

Revenue recognition
The group earns income from the following
principal services:

•

Revenue from consultancy services

Revenue from treasury management.

For all these principal services, revenue represents
amounts recoverable from clients for professional
services provided during the year. Revenue is
measured based on the consideration to which the
Group expects to be entitled in a contract with a
customer and excludes amounts collected on behalf
of third parties.

Revenue is recognised when control of a product
or service is transferred to a customer. A receivable
is recognised when the services are delivered as
this is the point in time that the consideration is
unconditional because only the passage of time
is required before the payment is due.

Revenue from fixed fee assignments is recognised
over a period of time by reference to the stage of
completion of the actual services provided at the
reporting date, as a proportion of the total services
to be provided because the customer receives and
uses the benefits simultaneously. This is determined
based on the actual labour hours spent relative to the
total expected labour hours.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202368

Notes to the Financial Statements

Investment in subsidiaries
In the Company’s financial statements,
investments in subsidiaries are carried at
cost less any accumulated impairment.

The cost of an investment in a subsidiary is
the aggregate of the fair value, at the date of
exchange, of assets given, liabilities incurred or
assumed, and equity instruments issued by the
Company, plus any costs directly attributable to
the purchase of the subsidiary.

Investments
Investments are held at fair value.

Financial instruments
Financial assets and financial liabilities are
recognised on the Group’s Statement of Financial
Position when the Group becomes a party to the
contractual provisions of the instrument.

Financial assets
Financial assets are classified into the following
specified categories: financial assets ‘at fair value
through profit or loss’ (FVTPL) and ‘amortised
cost’. The classification depends on the financial
asset’s contractual cash flow characteristics and
the Group’s business model for managing them
and is determined at the time of initial recognition.
Financial assets with cash flows that are not solely
payments of principal and interest are classified
and measured at fair value through profit or loss,
irrespective of the business model.

Amortised cost
Financial assets at amortised cost
These assets are held within a business model
whose objective is to collect contractual cash
flows which are solely payments of principals and
interest and therefore classified as subsequently
measured at amortised cost. With the exception of
trade receivables which are initially measured at
transaction price determined in accordance with
IFRS 15, financial assets at amortised cost are initially
recognised at fair value plus transaction costs that
are directly attributable to their acquisition and are
subsequently carried at amortised cost using the
effective interest rate method, less provision
for impairment. The Group’s financial assets
measured at amortised cost comprise trade and
other receivables and cash and cash equivalents.
Cash comprises cash in hand and deposits
repayable on demand, less overdrafts payable on
demand which have a right of offset against cash
balances. These instruments are readily convertible

to a known amount of cash and are subject to an
insignificant risk of change in value.

Financial assets at fair value through profit or loss
Assets that do not meet the criteria for amortised
cost are measured at FVTPL. A gain or loss on a debt
investment that is subsequently measured at FVTPL is
recognised in profit or loss and presented net within
other gains/(losses) in the period in which it arises.
The Group’s financial assets measured at FVTPL
comprise unquoted equity investments.

Impairment of financial assets
Impairment provisions for current trade
receivables are recognised based on the simplified
approach within IFRS 9 using a provision matrix
in the determination of credit losses. During this
process the probability of the non-payment of the
trade receivable is assessed. This probability is then
multiplied by the amount of the expected loss arising
from default to determine the expected credit loss for
the trade receivables. Provisions are recorded net
in a separate provision account with the loss being
recognised in the consolidated income statement.
On confirmation that the trade receivable will not
be collectable, the gross carrying value of the asset
is written off against the associated provision.
Impairment provisions for receivables from related
parties and loans to related parties are recognised
based on a forward-looking expected credit loss
model. The methodology used to determine the
amount of provision is based on whether there has
been a significant increase in credit risk since the
initial recognition of the asset.

Financial liabilities and equity
Financial liabilities and equity instruments are
classified according to the substance of the
contractual arrangements entered into.

Equity instruments
An equity instrument is any contract that evidences
a residual interest in the assets of the Group after
deducting all of its liabilities. Equity instruments
issued by the Group are recorded at the proceeds
received, net of direct issue costs.

Financial liabilities
Financial liabilities are classified as either
financial liabilities ‘at FVTPL’ or ‘amortised cost’.
The Group does not currently hold any financial
liabilities ‘at FVTPL’.

Impairment of non-financial assets
The Group assesses at each statement of
financial position date if there is any indication
that an asset may be impaired. If any such indication
exists, the Group estimates the recoverable amount
of the asset.

If there is any indication that an asset may be
impaired, the recoverable amount is estimated
for the individual asset. If it is not possible to estimate
the recoverable amount of the individual asset,
the recoverable amount of the cash-generating
unit to which the asset belongs is determined.

The recoverable amount of an asset or a cash-
generating unit is the higher of its fair value less
costs to sell and its value in use.

If the recoverable amount of an asset is less than its
carrying amount, the carrying amount of the asset is
reduced to its recoverable amount. That reduction is
an impairment loss.

An impairment loss of assets carried at cost less
any accumulated depreciation or amortisation
is recognised immediately in profit or loss.

An entity assesses at each reporting date
whether there is any indication that an impairment
loss recognised in prior periods for assets other than
goodwill may no longer exist or may have decreased.
If any such indication exists, the recoverable amounts
of those assets are estimated.

The increased carrying amount of an asset other than
goodwill attributable to a reversal of an impairment
loss does not exceed the carrying amount that would
have been determined had no impairment loss been
recognised for the asset in prior periods.

A reversal of an impairment loss of assets carried at
cost less accumulated depreciation or amortisation
other than goodwill is recognised immediately in
profit or loss.

Pensions
The Group contributes to defined contribution
schemes for the benefit of its directors and
employees. Contributions payable are charged
to the statement of comprehensive income in the
year they are payable.

Current and deferred income tax
The tax expense represents the sum of
the tax currently payable and deferred tax.

The tax currently payable is based on taxable
profit for the year. Taxable profit differs from net
profit as reported in the profit or loss, because it
excludes items of income or expense that are
taxable or deductible in other years and it further
excludes items that are never taxable or deductible.
The Company’s liability for current tax is calculated
using tax rates that have been enacted or
substantively enacted by the reporting date.

Deferred tax is the tax expected to be payable
or recoverable on differences between the carrying
amount of assets and liabilities in the financial
information and the corresponding tax bases used
in the computation of taxable profit and is accounted
for using the balance sheet liability method.
Deferred tax liabilities are recognised for all taxable
temporary differences and deferred tax assets
are recognised to the extent that it is probable
that taxable profits will be available against which
deductible temporary differences can be utilised.
Such assets and liabilities are not recognised if
the temporary difference arises from the initial
recognition of goodwill or from the initial recognition
(other than in a business combination) of other assets
and liabilities in a transaction which affects neither
the tax profit nor the accounting profit.

Deferred tax is calculated at the tax rates that are
expected to apply to the year when the asset is
realised, or the liability is settled. Deferred tax is
charged or credited in the profit or loss, except
when it relates to items credited or charged in other
comprehensive income directly to equity, in which
case the deferred tax is also dealt with in other
comprehensive income.

Deferred tax assets
Management regularly assesses the likelihood
that deferred tax assets will be recovered from future
taxable income. No deferred tax asset is recognised
when management believe that it is more likely than
not that a deferred asset will not be realised.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202370

Notes to the Financial Statements

Critical accounting estimates and judgements

In application of the Group’s accounting policies, which are described in note 2, the directors are required
to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are
not readily apparent from other sources. The estimates and associated assumptions are based on historical
experience and other factors that are relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised if the revision affects only that period,
or in the period of the revision and future periods if the revision affects both current and future periods.

Critical judgements in applying the Group’s
accounting policies
The following are the critical judgements,
apart from those involving estimations, that the
directors have made in the process of applying
the Group’s accounting policies and that have a
significant effect on the amounts recognised in
the financial statements.

Work in progress within revenue recognition
Work in progress is calculated on a project by
project basis using the fair value of chargeable
time that is un-invoiced at the period end.
Historic analysis shows that recovery rates of work
in progress are very high; the Group does not expect
any work in progress to be irrecoverable. Work in
progress is reviewed on a monthly basis to ensure
it is recognised appropriately, it is probable that
economic benefits will flow to the Group and that the
fair value can be reliably measured (note 4). Work in
progress is accounted for under contract assets.

Share based payments
The Company has granted share options to
certain employees and directors of the Group.
The share options granted become exercisable
at varying future dates. If certain conditions are met
the employee will be eligible to exercise their option
at an exercise price determined on the date the share
options are granted.

The share-based payment charge is recognised
in the statement of comprehensive income and is
calculated based on the Company’s estimate of
the number of share options that will eventually vest.

Assumptions regarding the fair value of the
Company’s shares are considered when measuring
the value of share-based payments for employees,
which are required to be accounted for as equity-
settled share-based payment transactions pursuant
to IFRS 2. The resulting staff costs are recognised pro
rata in the statement of comprehensive income to
reflect the services rendered as consideration during
the vesting period (note 20).

Share capital/equity instruments
Ordinary shares are classified as equity.
Equity instruments issued by the Company
are recorded at the proceeds received, net of
direct issue costs. The Company has one class
Ordinary share which carries no right to fixed income.
Each share carries the right to one vote at general
meetings of the Company.

Share-based payments
Equity-settled share-based payments to
employees and directors are measured at the
fair value of the equity instruments at grant date.
The fair value excludes the effect of non-market-
based vesting conditions.

The fair value determined at the grant date
of the equity-settled share-based payments is
expensed on a straight-line basis over the vesting
period, based on the Group’s estimate of equity
instruments that will eventually vest. At each reporting
date, the Group revises the estimate of the number
of equity instruments expected to vest as a result of
the effect of non-market-based vesting conditions.
The impact of the revision of the original estimates,
if any, is recognised in profit or loss such that the
cumulative expense reflects the revised estimate,
with a corresponding adjustment to equity reserves.

The fair value of the options is measured using the
Black Scholes options valuation model.

Adoption of new and revised standards
No new standards were adopted in the year.

Standards issued but not yet effective
There are no other standards that are not
yet effective and that would be expected to
have a material impact on the entity in the current
or future reporting periods and on foreseeable
future transactions.

Provisions
Provisions are recognised when the Group has a
present legal or constructive obligation as a result of
past events, it is probable that an outflow of resources
will be required to settle the obligation and a reliable
estimate of the amount can be made. If the effect is
material, provisions are determined by discounting
the expected future cash flows at an appropriate pre-
tax discount rate.

Leases
Leases are accounted for on a ‘right-of-use model’
reflecting that, at the commencement date, the
Company as a lessee has a financial obligation
to make lease payments to the lessor for its right to
use the underlying asset during the lease term. The
financial obligation is recognised as a lease liability,
and the right to use the underlying asset is recognised
as a right-of-use asset. The right-of-use assets are
recognised within property, plant and equipment on
the face of the financial position and are presented
separately in note 11.

The lease liability is initially measured at the
present value of the lease payments using the
rate implicit in the lease or, where that cannot be
readily determined, the incremental borrowing
rate. Subsequently the lease liability is measured at
amortised cost, with interest increasing the carrying
amount and lease payments reducing the carrying
amount. The carrying amount is re-measured to
reflect any reassessment or lease modifications, or to
reflect revised in-substance fixed lease payments.

Right-of-use assets are measured at cost comprising
the following:

•

the amount of the initial measurement
of lease liability;

any lease payments made at or before
the commencement date less any lease
incentives received;

any initial direct costs; and

restoration costs.

Subsequently the right-of-use asset is measured at
cost less accumulated depreciation and impairment
losses. Depreciation is calculated to write off the cost
on a straight line-basis over the lease term.

The Group does not have any short-term leases of
equipment or vehicles.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202372

Notes to the Financial Statements

Key sources of estimation uncertainty
The key assumptions concerning the future, and
other key sources of estimation uncertainty at the
reporting date, that may have a significant risk of
causing material adjustment to the carrying amounts
of assets and liabilities within the next financial year,
are discussed below.

Impairment of goodwill
The carrying amounts of the Group’s assets value
are reviewed at each reporting date to determine
whether there is any indication of impairment. If any
such indication exists, the asset’s recoverable amount
is estimated, and an impairment loss is recognised
where the recoverable amount is less than the
carrying value of the asset. Any impairment losses are
recognised in the income statement.

The recoverable amount of the goodwill is
determined from value in use calculations.
The key assumptions for the value in use calculations
are those regarding the discount rates, growth rates
and expected changes to income and direct costs
during the period.

Management estimates discount rates using pre-tax
rates that reflect current market assessments of the
time value of money and the risks specific to each
acquisition of goodwill. Discount rates of 16.12% and a
terminal value of 1% has been used.

Growth rates of between 0-15% have been applied
to each cash generating unit as set out in note 10
these are based on industry rates, management’s
knowledge of the different businesses and the
markets and the ability for the businesses to expand.
The maximum period over which the cashflows are
reviewed is 5 years.

Sensitivities have been applied to all assumptions.

Valuation of unquoted investments
The Group determines the fair value of these financial
instruments using recent transactions or valuation
models if information about recent transactions is not
available. The values derived from applying these
models are significantly impacted by the choice
of the valuation model used and the underlying
assumptions made, such as the amounts and timing
of future cash flows, discount rates, volatility and
credit risk.

Management has determined that a valuation based
on five times annual turnover is an appropriate
measure of fair value based on prior knowledge of
the industry.

Revenue and finance income

An analysis of the Group’s revenue is as follows:

Continuing operations - rendering of services

Specialist housing consultancy income

Treasury management income

Specialist sports and education consultancy income

Interest received on bank deposits

2023
£’000

10,558

431

1,260

12,249

12,266

2022
£’000

8,502

600

1,017

10,119

5. Operating segments

The Group has two reportable segments; consultancy and treasury management services, the results of which
are included within the financial information. In accordance with IFRS8 ‘Operating Segments’, information on
segment assets is not shown, as this is not provided to the chief operating decision-maker.

The principal activities of the Group are as follows:

Consultancy – a range of services to support the business needs of a diverse range of organisations
(including housing associations, local authorities, multi academy trusts and sporting businesses) across the
housing, education and sports sectors. Most consultancy projects run over one to two months and on-going
business development is required to ensure a full pipeline of consultancy work for the employed team.

Treasury Management - within this segment of the business several client organisations enter fixed period
retainers to ensure immediate call-off of the required services.

The accounting policies of the reportable segments are the same as the Group’s accounting policies
described in note 2. Segment profit represents the profit earned by each segment, without allocation of
central administration costs, including directors’ salaries, finance costs and income tax expense. This is the
measure reported to the Group’s executive directors for the purpose of resource allocation and assessment
of segment performance.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202374

Notes to the Financial Statements

5. Operating segments (continued)

Revenue from Consultancy

Revenue from Treasury management

Cost of sales from Consultancy

Cost of sales from Treasury management

Gross profit from Consultancy

Gross profit from Treasury management

Administrative expenses

Operating profit

Within consultancy revenues, approximately 18% (2022: 9%) has arisen from the
segment’s largest customer L&Q; within treasury management 11% (2022: 15%).

2023
£’000

11,818

431

12,249

9,269

375

9,644

2,550

2,605

(1,828)

777

2022
£’000

9,519

600

10,119

7,367

546

7,913

2,152

2,206

(1,488)

718

Geographical information
Revenues from external customers, based on location of the customer, are shown below:

Europe

Rest of World

2023
£’000

11,727

508

12,249

2022
£’000

9,528

380

211

10,119

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202376

Notes to the Financial Statements

Profit before taxation

Staff costs

Profit before taxation is arrived at after charging:

Auditors’ remuneration (see below)

Depreciation of property, plant and equipment (see note 11)

Depreciation of leasehold property (see note 11)

Impairment of goodwill

Staff costs (see note 7)

Breakdown of auditors’ remuneration

Auditors’ remuneration

Fees payable to the Company’s auditors for:

The audit of the parent Company

The audit of the Company’s subsidiaries

The review of the interim report

The provision of a CASS assurance report to the FCA

2023
£’000

120

7,180

2022
£’000

5,879

2023
£’000

2022
£’000

The average monthly number of employees (including
directors) employed by the Group was:

102

2023

2022

Aggregate remuneration (including directors)

Wages and salaries

Share-based payments

Pension contributions

Social security costs

Directors’ remuneration

Salary (including taxable benefits)

Share-based payments

Pension contributions

Two directors are members of the company’s defined contribution
pension scheme.

2023
£’000

6,153

314

701

7,180

345

363

2022
£’000

5,171

262

438

5,879

330

352

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202378

Notes to the Financial Statements

Staff costs (continued)

The amounts set out above include remuneration to the highest paid director as follows:

Salary (including taxable benefits)

Share-based payments

Pension contributions

2023
£’000

195

205

Remuneration of key management personnel
The remuneration of the key management personnel of the Group, including all directors, is set
out below in aggregate for each of the categories specified in IAS 24 Related Party Disclosures.

Wages and salaries

Share-based payments

Post-retirement benefits

2023
£’000

1,036

1,089

2022
£’000

177

191

2022
£’000

1,186

(7)

1,228

Taxation

Corporation tax:

Current year

The tax charge for the year can be reconciled to the profit in the income statement as follows:

Profit before taxation

Tax at the UK corporation tax rate of 19% (2022: 19%)

Expenses not deductible

Tax expense for the year

2023
£’000

2022
£’000

156

139

674

128

156

718

136

139

The Finance Bill 2021 substantively enacted on 24 May 2021 included
legislation increasing the UK corporation tax rate from 19% to 25% with effect from 1 April 2023.

Earnings per share

Basic earnings per share is calculated by dividing the profit after tax attributable to the
equity holders of the Group by the weighted average number of shares in issue during the
year. Diluted earnings per share is calculated by adjusting the weighted average number
of shares outstanding to assume conversion of all potential dilutive shares, namely share
options. Details of which are set out in note 20.

Profit after tax attributable to owners of the parent

Weighted average number of shares

- Basic

- Diluted

Basic earnings per share

Diluted earnings per share

2023
£’000

518

’000

39,962

41,016

1.29p

1.26p

2022
£’000

579

’000

39,962

41,153

1.45p

1.41p

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202380

Notes to the Financial Statements

10. Goodwill

Group

Cost

At 1 April 2021

Additions

At 31 March 2022

Additions

At 31 March 2023

Accumulated impairment losses

At 1 April 2021

Impairment loss for the year

At 31 March 2022

Impairment loss for the year

At 31 March 2022

Net book value

At 1 April 2021

At 1 April 2022

At 31 March 2023

A decline in turnover of 10% would trigger
an impairment in Treasury, 10% in Property and
8% in Oaks. A decline in gross profit to 21% would
trigger an impairment in Treasury, 16% in Property
and 19% in Oaks. A discount rate of 26% would
trigger an impairment in Treasury, 40% in Property
and 35% in Oaks.

The sensitivities applied in Property and Oaks
do not provide reasonable possible changes
and therefore no impairment has been made.
However, an impairment has been made of
£120k within Treasury due to the decline in
the Education market.

Goodwill
£’000

3,872

(555)

(120)

(675)

3,317

3,197

Goodwill acquired in a business combination is
allocated, at acquisition, to the cash generating
units that are expected to benefit from that business
combination. Each Subsidiary is considered to
be the cash generating unit for the purpose of
impairment review.

The Group tests goodwill annually for impairment,
or more frequently if there are any indications that
goodwill might be impaired.

The recoverable amount of goodwill is
determined from value in use calculations.
The key assumptions for the value in use calculations
are those regarding growth rate of client base
and project fees. Management’s approach to
determining the values to each key assumption
is based on experience and project work already
secured for future periods and the expected
utilisation of consultants. Management have
projected cash flows over a period of five years,
based on growth rates of between 0% and 16%
per annum; this is based on past performance
and expected future activity. A discount rate of
16.1% and a terminal value of 1.0% has been used.

The Growth rates for each cash generating unit is as
follows. For Property 0-7% (2022: 0-7%), for Treasury
0-16% (2022: 5-6%), for Oaks 6% (2022: 9-13%)

Sensitivity analysis has been performed on the
value in use calculations, holding all other variables
constant to:

• Apply a 5-10% reduction to the

forecasted turnover.

• Apply a 5-10% decrease in gross profit margins.

• Apply an increase in the discount rate.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202382

Notes to the Financial Statements

11. Property, plant and equipment (Group)

Group

Cost

At 1 April 2021

Additions

At 31 March 2022

Additions

At 31 March 2023

At 1 April 2021

Charge for the year

At 31 March 2022

Charge for the year

At 31 March 2023

Net book value

At 1 April 2021

At 31 March 2022

At 31 March 2023

Right of
use assets-
Leasehold
property
£’000

Leasehold
improvement
£’000

Fixtures
and
fittings
£’000

Computer
equipment
£’000

Total
£’000

514

153

241

329

361

273

185

173

210

254

160

182

211

759

796

841

365

118

483

124

607

394

313

234

Company

Cost

At 1 April 2021

Additions

At 31 March 2022

Additions

At 31 March 2023

Accumulated depreciation

At 1 April 2021

Charge for the year

At 31 March 2022

Charge for the year

At 31 March 2023

Net book value

At 1 April 2021

At 31 March 2022

At 31 March 2023

Computer
equipment
£’000

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202384

Notes to the Financial Statements

12.

Investments in subsidiaries

Company

Cost

At 1 April 2021

Additions

At 31 March 2022

Addition

At 31 March 2023

Accumulated impairment losses

At 1 April 2021

Impairment losses for the year

At 31 March 2022

Impairment losses for the year

At 31 March 2023

Net book value

At 1 April 2021

At 31 March 2022

At 31 March 2023

Investments in
subsidiaries
£’000

4,725

4,735

4,747

555

120

675

4,170

4,180

4,072

Details of the Company’s subsidiaries at 31 March 2023 are as follows:

Place of incorporation
and operation

Principal activity

Proportion of ownership
and voting rights held

England and Wales

Specialist housing
consultancy

100%

England and Wales

Treasury management
consultancy

100%

Altair Consultancy
and Advisory Services
Limited

Aquila Treasury and
Finance Solutions
Limited

Oaks Consultancy
Limited

England and Wales

Specialist sports and
education consultancy

100%

The accounting reference date of each of the subsidiaries above is co-terminus with that of the
Company. The registered office of each subsidiary is Tempus Wharf, 29a Bermondsey Wall West,
London, SE16 4SA.

The following companies are all dormant, the registered office of each is Tempus Wharf,
29a Bermondsey Wall West, London, SE16 4SA.

Place of incorporation
and operation

Proportion of ownership
and voting rights held

Accounting
reference date

Altair International
Consultancy Limited

England and Wales

100% held by Aquila
Services Group plc

31 August

Murja Limited

England and Wales

Finalysis UK Limited

England and Wales

100% held by
ATFS Limited

30 May

100% held by Aquila
Services Group plc

31 March

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202386

Notes to the Financial Statements

13.

Investments

14. Trade and other receivables

Unquoted
equity investments

Fair Value
Hierarchy

Level 3

2023
£’000

2022
£’000

The Group has a 5.3% equity shareholding
in AssetCore Limited an unquoted company.
AssetCore’s principal activity is a cloud-based
platform used to manage loan security within
the affordable housing sector. As explained in
Note 3, based on the information available at the
reporting date the directors consider cost to be an
appropriate estimate of fair value.

Financial instruments measured at fair value
subsequent to initial recognition are grouped into
levels 1 to 3 based on the degree to which the fair
value is observable, i.e.:

Level 1 fair value measurements are those derived
from quoted prices (unadjusted) in active markets
for identical assets or liabilities.

Level 2 fair value measurements are those derived
from inputs other than quoted prices included within
level 1 that are observable for the asset or liability,
either directly or indirectly.

Level 3 fair value measurements are those derived
from valuation techniques that include inputs for the
asset or liability that are not based on observable
market data (unobservable inputs).

Trade receivables

Group undertakings

Other receivables

Prepayments

Contract assets

Group
2023
£’000

Group
2022
£’000

Company
2023
£’000

Company
2022
£’000

2,715

2,240

102

262

117

201

3,130

2,593

195

236

964

991

Total
£’000

<30 days
£’000

30-60 days
£’000

66-90 days
£’000

>90 days
£’000

31 March 2023

31 March 2022

2,715

2,240

2,556

2,182

No expected credit loss is recognised in the accounts. The Group does not expect any debts
not to be paid. The directors have reviewed the provision for expected credit loss and have not
identified any which need to be provided for.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202388

Notes to the Financial Statements

15. Trade and other payables

17. Share capital

Group
2023
£’000

Group
2022
£’000

Company
2023
£’000

Company
2022
£’000

Trade payables

Other payables

Amounts owed to Group undertakings

Taxes and social security costs

Accruals

Contract liabilities

532

163

974

357

473

510

715

246

369

2,499

1,917

433

228

694

Of the contract liability brought forward at the start of the year £369k (2022: £297k)
was recognised in revenue in the year.

16. Lease liabilities

The Statement of Financial Position shows the following amounts relating to lease liabilities.

At 31 March 2022

Lease payments

Interest expense

Closing amounts as at 31 March 2023

Current

Non-current

283

146

440

2023
£’000

284

(97)

195

126

Allotted, called up and fully paid

39,961,955 (2022: 39,961,955) Ordinary shares of 5p each

1,998

2023
£’000

2022
£’000

The Company has one class Ordinary share which carries no right to fixed
income. Each share carries the right to one vote at general meetings of the Company.

A reconciliation of share capital, share premium account and merger reserve is set out below:

Number of
Ordinary
shares
’000

39,962

Amount
called up
and fully
paid
£’000

1,998

Share
premium
£’000

Merger
reserve
£’000

1,712

3,042

At 31 March 2021

At 31 March 2022

At 31 March 2023

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202390

Notes to the Financial Statements

18. Reserves

The share premium account represents the amount received on the issue of Ordinary
shares by the Company in excess of their nominal value and is non-distributable.

The merger relief reserve arose on the Company’s acquisition of Altair. There is no legal share
premium on the shares issued as consideration as section 612 of the Companies Act 2006, which
deals with merger relief, applies in respect of the acquisition. Since the shareholders of Altair
became the majority shareholders of the enlarged group, the acquisition is accounted for as
though the legal acquiree is the accounting acquirer.

Unapproved scheme

Number of options outstanding at 1 April 2022

Lapsed during period

Exercised during period

Number of options outstanding as at 31 March 2023

Number of options exercisable as at 31 March 2023

Number
’000

Weighted
average
exercise price

£0.35

171

The exercise price of the options outstanding at 31 March 2023 is 35p. The weighted average
remaining contractual life of the options outstanding at 31 March 2023 is 2 years (2022: 3 years).

19. Dividends

Amounts recognised as
distributions to equity holders

Final dividend for the year ended
31 March 2022 of 0.4p per share (2021: 0.4p)

Interim dividend for the year ended
31 March 2023 of 0.25p per share (2022: 0.2p)

Proposed final dividend for the year
ended 31 March 2023 of 0.5p per share (2022: 0.4p)

20. Share-based payment transactions

The Company operates an Unapproved Scheme and an Enterprise Management Incentives
Scheme. The total charge in the year to 31 March 2023 arising from share-based payment
transactions is £12k (2022: £8k).

2023
£’000

2022
£’000

Number of options outstanding at 1 April 2022

EMI scheme

160

100

260

200

160

240

160

Granted during the period

Lapsed during the period

Cancelled during period

Number of options outstanding as at 31 March 2023

Number of options exercisable as at 31 March 2023

Number
’000

Weighted
average
exercise price

£0.05

£0.26

£0.05

£0.26

1,474

931

(169)

(40)

2,196

1,305

The weighted average remaining contractual life of the options outstanding at 31 March 2023 is
5 years (2022: 3 years).

On 1 April 2022, the Company granted 930,770 options to certain employees and directors of
the Group at an exercise price of 26p. The options are exercisable between 1 April 2025 and 31
March 2032. The weighted average fair value of the options at grant date was £0.0416. The fair
value of the options was measured using the Black Scholes options valuation model. The inputs
into that model in respect of the EMI share options were as follows:

Share price £0.26

Exercise price £0.26

Expected volatility 20.81%

Expected option life 10 years

Risk-free rate 1.3%

21. Related party disclosures

Balances and transactions between the Group
and other related parties are disclosed below:

Dividends totalling £76k (2022: £70k) were paid in
the year in respect of Ordinary Shares held by the
Company’s directors.

At 31 March 2023, the balance owed to Richard
Wollenberg for services as a non-executive director
was £8k (2022: £4k).

Amounts paid to Derek Joseph for
consultancy services £17k (2022: £23k).

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202392

Notes to the Financial Statements

Notice of Annual General Meeting

22. Control

In the opinion of the Directors there is no single ultimate controlling party.

23. Financial instruments

Financial risk management
The Group’s activities are exposed to a variety of market risk (including foreign currency risk and
interest rate risk), credit risk and liquidity risk.

Credit risk
Credit risk is the risk of financial loss to the Group resulting from counterparties failing to
discharge their obligations to the Group. The Group’s principal financial assets are trade and
other receivables and cash and cash equivalents. The Group only deposits cash with banks that
have an A rating. The Group holds cash in current and treasury reserve accounts. The sums held
in treasury reserve are on less than six-month terms, the Group has access to this cash should it
be required at short notice.

The Group considers its credit risk to be low. Of the total trade receivables at the 2023
year-end £729k (2022: £258k) is due from one customer.

There are no other customers that represent more than 10% of the total balance of
trade receivables. The maximum exposure to credit risk is equal to the carrying value of
these instruments.

Liquidity risk
Liquidity risk is the risk of the Group being unable to meet its liabilities as they fall due.
The Group manages liquidity risk by maintaining enough cash reserves and holding banking
facilities, and by continuously monitoring forecast and actual cash flows. In addition, the Group
is a cash generative business with income being received regularly over the course of the year.
The Group held cash balances of £2,405K (2022: £2,193k) at the year-end.

Trade payables are all less than 30days.

Foreign currency risk
Foreign exchange risk is the risk of loss due to adverse movements in the exchange rates
affecting the Group’s profits and cash flows. Only a very small number of clients are invoiced
in Euros and USD and the foreign exchange exposure is not considered a significant risk.
The Group’s principal financial assets are cash and cash equivalents and trade and other
receivables, which are almost exclusively denominated in Pounds Sterling.

Interest rate risk
The Group does not undertake any hedging activity in this area. The main element in interest
rate risk involves sterling deposits.

Capital risk management
Internal working capital requirements are low and are regularly monitored.

The Group’s objective when managing capital is to safeguard the Group’s ability to continue as
a going concern in order to provide return for shareholders, benefits for other stakeholders and
to maintain optimal capital structure and to reduce the cost of capital.

In order to ensure an appropriate return for shareholder capital invested in the Group,
management thoroughly evaluates all material projects and potential acquisitions and has them
approved by the Board of Directors where applicable.

The Group monitors capital on a short- and medium-term view.

24. Post Balance Sheet events

There are no post balance sheet events.

Notice of Annual General Meeting

Notice is hereby given that the Annual General Meeting (AGM) of Aquila Services Group plc will be held
at Tempus Wharf 29A, Bermondsey Wall West, London, SE16 4SA on 26 July 2023 at 12:00 midday, for the
purpose of considering and, if thought fit, passing the following resolutions, of which resolutions numbered
1 to 6 will be proposed as ordinary resolutions and resolutions 7 and 8 will be proposed as special
resolutions. Resolutions 6 to 8 are items of special business.

Ordinary business

To receive the reports of the directors and auditor and the financial statements for the period ended 31
March 2023.

2. To approve the remuneration report for the period ended 31 March 2023.

3. To approve the revised remuneration policy applicable for the period commencing 01 April 2023 as set

out in the annual report and financial statements.

4. That, following a recommendation by the directors, a final dividend payment of 0.5p per Ordinary Share

shall be paid to those persons who were named on the register of shareholders on 14 July 2023.

5. That Crowe UK LLP be and is hereby reappointed as auditor of the Company and that the directors be

authorised to determine the auditor’s remuneration.

Special business

6. That, in accordance with section 551 of the Companies Act 2006 (“CA 2006”), the directors be generally
and unconditionally authorised to issue and allot equity securities (as defined by section 560 of the CA
2006) up to an aggregate nominal amount of:

6.1

£73,825 in connection with the valid exercise of the options (both approved and unapproved)
granted by the Company (as set out in the prospectus issued by the Company dated 20 July 2015),
any unapproved options granted to current or former officers of the Company and options granted
to employees and officers of the Company and/or its subsidiaries in accordance with the terms of
the Company’s Employee Share Option Scheme (“Options”); and

6.2 in any other case, £666,033 (such amount to be reduced by the nominal amount of any equity

securities allotted pursuant to the authorities in paragraph 6.1 above in excess of the stated
amount) provided that this authority shall, unless renewed, varied or revoked by the Company,
expire on the date of the next annual general meeting of the Company save that the Company may,
before such expiry, make offers or agreements which would or might require relevant securities to
be allotted and the directors may allot relevant securities in pursuance of such offer or agreement
notwithstanding that the authority conferred by this resolution has expired.

This resolution revokes and replaces all unexercised authorities previously granted to the directors
to allot relevant securities but without prejudice to any allotment of shares or grant of rights already
made, offered or agreed to be made pursuant to such authorities.

That, subject to resolution 6 above being duly passed, the directors of the Company be and are hereby
empowered, pursuant to section 570 of the CA 2006, to allot equity securities (as defined in section 560
of the CA 2006) wholly for cash pursuant to the authority conferred upon them by resolution 6 above (as
varied, renewed or revoked from time to time by the Company at a general meeting) as if section 561(1)
of the CA 2006 did not apply to any such allotment provided that such power shall be limited to the
allotment of equity securities:

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023
94

Notice of Annual General Meeting

in connection with a rights issue or any other pre-emptive offer in favour of holders of equity

7.1
securities where the equity securities offered to each such holder is proportionate (as nearly as may be)
to the respective amounts of equity securities held by each such holder subject only to such exclusion
or other arrangements as the directors may consider appropriate to deal with fractional entitlements or
legal or practical difficulties under the laws of or the requirements of any recognised regulatory body in
any territory or otherwise;

7.2 in connect in connection with the valid exercise of Options;

7.3

in connection with the valid exercise of any share options granted to employees of the Group
in accordance with the terms of the Employee Share Option Scheme; and

7.4 otherwise, up to a maximum nominal amount of £99,905.

The power granted by this resolution will expire on the conclusion of the Company’s next annual general
meeting (unless renewed, varied or revoked by the Company prior to or on such date) save that the
Company may, before such expiry, make offers or agreements which would or might require equity
securities to be allotted after such expiry and the directors may allot equity securities in pursuance of
any such offer or agreement notwithstanding that the power conferred by this resolution has expired.

This resolution revokes and replaces all unexercised powers previously granted to the directors to allot
equity securities as if section 561(1) of the CA 2006 did not apply but without prejudice to any allotment
of equity securities already made or agreed to be made pursuant to such authorities.

8. That the Company be and is hereby authorised generally and unconditionally to make

market purchases (within the meaning of section 693(4) of the CA 2006) of its ordinary shares
(“Ordinary Shares”) provided that:

8.1 the maximum aggregate number of Ordinary Shares that may be purchased is 3,996,196;

8.2 the minimum price (exclusive of expenses) which may be paid for an Ordinary Share is £0.05;

8.3

the maximum price (exclusive of expenses) which may be paid for an Ordinary Share is the
higher of:

8.3.1

105 per cent of the average closing middle market quotations for the Ordinary Shares as
quoted on the Official List of the London Stock Exchange for the five business days prior
to the day the purchase is made; and

8.3.2

the value of an Ordinary Share calculated on the basis of the higher of the price
quoted for:

8.3.3

the last independent trade of; and

8.3.4

the highest current independent bid for any number of Ordinary Shares on the
Official List.

8.4 The authority conferred by this resolution shall expire on the conclusion of the Company’s next

annual general meeting save that the Company may, before the expiry of the authority granted by
this resolution, enter into a contract to purchase Ordinary Shares which will or may be executed
wholly or partly after the expiry of such authority.

Registered office:
Tempus Wharf
29a Bermondsey Wall West
London
SE16 4SA

–
By order of the board
Claire Banks -
Company Secretary
30 June 2023

Notes to the notice of the Annual General Meeting

1. A member entitled to attend and vote at the above meeting is entitled to appoint a proxy to exercise all
or any of their rights to attend, speak and vote on his/her behalf at the meeting. A proxy need not be a
member of the company.

2. You may appoint more than one proxy provided each proxy is appointed to exercise rights attached to

different shares. You may not appoint more than one proxy to exercise rights attached to any one share.
To appoint more than one proxy you may photocopy the form of proxy. Please indicate the proxy holder’s
name and the number of shares in relation to which they are authorised to act as your proxy (which,
in aggregate, should not exceed the number of shares held by you). Please also indicate if the proxy
instruction is one of multiple instructions being given. All forms must be signed and should be returned
together in the same envelope.

3. A form of proxy accompanies this notice. Forms of proxy, to be valid, must be delivered to the

company’s registrars, Neville Registrars Limited, Neville House, Steelpark Road, Halesowen B62 8HD
in accordance with the instructions printed thereon, not less than 48 hours before the time set for the
holding of the meeting.

If you are not a member of the company but you have been nominated under section 146 of
the Companies Act 2006 (the ‘Act’) by a member of the company to enjoy information rights, you
do not have the rights of members in relation to the appointment of proxies set out in notes 1, 2 and 3.
The rights described in those notes can only be exercised by members of the company.

5. A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of votes
for or against the resolution. If you either select the “Withheld” option or if no voting indication is given,
your proxy will vote or abstain from voting at his or her discretion. Your proxy will vote (or abstain from
voting) as he or she thinks fit in relation to any other matter which is put before the meeting.

Information regarding the meeting, including the information required by section 311A of the Act, is
available from www.aquilaservicesgroup.co.uk

7. As provided by Regulation 41 of the Uncertificated Securities Regulations 2001, only those members

registered in the register of members of the company 48 hours before the time set for the meeting shall be
entitled to attend and vote at the meeting in respect of the number of shares registered in their name at
that time. Changes to entries on the relevant register of securities after that time shall be disregarded in
determining the rights of any person to attend or vote at the meeting.

8. As at close of business on 29 June 2023 the company’s issued share capital comprised 39,961,955

ordinary shares of 5 pence each. Each ordinary share carries the right to one vote at a general meeting
of the company and, therefore, the total number of voting rights in the company at close of business on 29
June 2023 is 39,961,955.

9. Under section 319A of the Act, the company must answer any question you ask relating to the business
being dealt with at the meeting unless (a) answering the question would interfere unduly with the
preparation for the meeting or involve the disclosure of confidential information; (b) the answer has
already been given on a website in the form of an answer to a question; or (c) it is undesirable in the
interests of the company or the good order of the meeting that the question be answered.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 2023

Notice of Annual General Meeting

10.

If you are a person who has been nominated under section 146 of the Act to enjoy information rights
(a ‘Nominated Person’), you may have a right under an agreement between you and the member of the
company who has nominated you to have information rights (a ‘Relevant Member’) to be appointed or to
have someone else appointed as a proxy for the meeting. If you either do not have such a right or if you
have such a right but do not wish to exercise it, you may have a right under an agreement between you
and the Relevant Member to give instructions to the Relevant Member as to the exercise of voting rights.
Your main point of contact in terms of your investment in the company remains the Relevant Member
(or, perhaps, your custodian or broker) and you should continue to contact them (and not the company)
regarding any changes or queries relating to your personal details and your interest in the company
(including any administrative matters). The only exception to this is where the company expressly requests
a response from you.

11. Members satisfying the thresholds in section 338 of the Act may require the company to give,

to members of the company entitled to receive notice of the Annual General Meeting, notice of a
resolution which those members intend to move (and which may properly be moved) at the Annual
General Meeting. A resolution may properly be moved at the Annual General Meeting unless (i) it would,
if passed, be ineffective (whether by reason of any inconsistency with any enactment or the company’s
constitution or otherwise); (ii) it is defamatory of any person; or (iii) it is frivolous or vexatious. A request
made pursuant to this right may be in hard copy or electronic form, must identify the resolution of which
notice is to be given, must be authenticated by the person(s) making it and must be received by the
company not later than 6 weeks before the date of the Annual General Meeting.

12. Members satisfying the thresholds in section 338A of the Act may request the company to include in the
business to be dealt with at the Annual General Meeting any matter (other than a proposed resolution)
which may properly be included in the business at the Annual General Meeting. A matter may properly
be included in the business at the Annual General Meeting unless (i) it is defamatory of any person or (ii)
it is frivolous or vexatious. A request made pursuant to this right may be in hard copy or electronic form,
must identify the matter to be included in the business, must be accompanied by a statement setting out
the grounds for the request, must be authenticated by the person(s) making it and must be received by
the company not later than 6 weeks before the date of the Annual General Meeting.

13. Members satisfying the thresholds in section 527 of the Act can require the company to publish a
statement on its website setting out any matter relating to (i) the audit of the company’s accounts
(including the auditor’s report and the conduct of the audit) that are to be laid before the Annual
General Meeting; or (ii) any circumstances connected with an auditor of the company ceasing
to hold office since the last Annual General Meeting, which the members propose to raise at the
meeting. The company cannot require the members requesting the publication to pay their expenses.
Any statement placed on the website must also be sent to the company’s auditor no later than the time
it makes its statement available on the website. The business which may be dealt with at the Annual
General Meeting includes any statement that the company has been required to publish on its website
pursuant to this right.

14. Copies of the directors’ service contracts will be available for inspection at the registered office of
the company during usual business hours from the date of this notice until the date of the Annual
General Meeting, and also during and at least fifteen minutes before the beginning of the Annual
General Meeting.

Aquila Services Group plcAnnual report and financial statements for the year ended 31 March 202398

Directors
Derek Joseph
Non-Executive Chair

Dr Fiona Underwood
Group Chief Executive
Officer

Claire Banks
Group Finance Director

Richard Wollenberg
Non-Executive Director

Company Secretary
Claire Banks

Registered Office
Tempus Wharf
29a Bermondsey Wall West
London
SE16 4SA

Independent Auditors
Crowe U.K. LLP
55 Ludgate Hill
London
EC4M 7JW

Corporate Advisor
Beaumont Cornish Limited
Building 3
566 Chiswick High Road
London
W4 5YA

Bankers
National Westminster Bank plc
50 High Street
Egham
Surrey
TW20 9EU

Registrars
Neville Registrars Limited
Neville House
Steelpark Road
Halesowen
B62 8HD

Company Number
08988813

Company Site
aquilaservicesgroup.co.uk

London Stock Exchange
londonstockexchange.com/stock/
AQSG/aquila-services-group-plc/
company-page

Annual report and financial statements for the year ended 31 March 2023