ANNUAL REPORT AND ACCOUNTS 2023
AUTINS GROUP PLC
AGILE, ACOUSTIC AND THERMAL ENGINEERING
PROBLEM SOLVERS
Autins Group plc
Central Point One Central Park Drive
Rugby CV23 0WE
T: +44 (0)1788 578 300
W: www.autins.com
1
CONTENTS
Strategic report
Introduction
At a glance
Chairman’s statement
Chief Executive Officer’s review
Strategy in action
Our commitment to ESG
Our Stakeholders
Directors’ section 172 statement
Financial review
Key performance indicators (‘KPIs’)
Principal risks and uncertainties
Governance
Statement of Directors’ responsibilities
Board of Directors and senior management
Corporate governance statement
Directors’ report
Director’s remuneration report
Audit Committee report
Financial statements
Independent auditor’s report
Consolidated income statement
Consolidated statement of comprehensive income
Consolidated statement of financial position
Parent company statement of financial position
Consolidated statement of changes in equity
Parent company statement of changes in equity
Consolidated statement of cashflows
Notes to the financial statements
Directors, secretary, registered office and advisors
WWW.AUTINS.COM
3
4
6
8
10
11
13
14
15
19
21
24
25
27
32
36
38
40
47
48
49
50
51
52
53
55
81
2
STRATEGIC REPORT
INTRODUCTION
SOLVING YOUR ACOUSTIC AND THERMAL CHALLENGES
Our purpose
We are acoustic and thermal specialists and apply our in-house materials expertise to manufacture products
that solve challenging engineering problems, primarily for the automotive, commercial vehicle and flooring
sectors.
We can help electric vehicle manufacturers extend the range of their vehicles, by reducing the energy losses
whilst heating or cooling the cabins. We improve the acoustic comfort in the vehicle for all passengers. We
strive to maximise the use of sustainable materials.
We manufacture in the UK, Germany and Sweden and have world class quality and performance metrics,
making us a truly trusted local European partner.
We have our own patented NeptuneTM technology which is manufactured in our UK facilities and provides
a real point of difference, as it is superior to all competitor materials in terms of reducing thermal losses and
acoustic noise, whilst boasting leading levels of recycled material content and recyclability.
Financial overview
Revenue
FY23: £22.7 million +20.2%
FY22: £18.9 million
EBITDA
FY23: £1.2 million profit
FY22: £1.1 million loss
Cash from Operating Activities
FY23: £2.1 million inflow
FY22: -£0.5 million outflow
Net debt1
FY23: £1.6 million
FY22: £2.0 million
Gross profit
FY23: £ 6.7 million +57.8%
FY22: £ 4.2 million
Operating loss
FY23: -£0.7 million
FY22: -£3.0 million
Earnings per share
FY23: -1.67p loss
FY22: -6.34p loss
Final dividend
FY23 Nil
FY22: Nil
1 Net debt is cash less bank overdrafts, loans, invoice discounting, hire purchase finance and
excludes IFRS16 right of use lease liabilities.
3
AT A GLANCE
Who we are
156
Employees
3
Countries
4
Operating locations
160
Customer locations
What we do
We design
We use our acoustic and thermal expertise and experience to research, test and develop bespoke solutions
and products for our customers. Innovative design and the patent protected Neptune technology are our
USPs.
We manufacture
We have a wide range of advanced manufacturing and conversion processes which deliver truly world-class
quality products and services. We manufacture Neptune in our own Tamworth facility.
We support
We are agile and creative and will support the customer from cradle to grave, from design development and
prototyping to engineering changes once in production.
Our specialist solutions
Acoustic
We have acoustic barrier materials and absorbers. Our range of unique Neptune nonwoven products are
the lightest weight solutions available on the market and are particularly high performing in the range
required by electric vehicles. Our flooring solutions, in our Decibex range, are bespoke developments
designed for specific customer needs.
Thermal
Neptune has the best combination of acoustic and thermal resistance of any material we have tested,
which is why it has been selected for use in the cabin of a number of very well-known car and truck
brands. Our materials are being used to protect passengers from the heat of an engine or to provide
thermal control such as extending battery life in electric engines. Our patented Neptune product has
market leading low thermal conductivity, which is ideal for applications in automotive and commercial
vehicles and when combined with reflective foils can be used in a diverse range of applications such as
HVAC.
Our industries
Automotive
79 Customers
Other markets
12 Customers
4
AT A GLANCE
Where we operate
Tamworth, UK
Materials’ manufacturing, assembly and conversion operation
Rugby, UK
Group headquarters, Group technical centre (laboratory and test site), new product introduction centre,
assembly and conversion operation
Dusseldorf, Germany
New product introduction centre, assembly and conversion operation
Gothenburg, Sweden
New product introduction centre, materials manufacturing, assembly and conversion operation
5
CHAIRMAN’S STATEMENT
Overview
FY23 has been a transitional year in which the Group has moved from a significant EBITDA loss to a positive
EBITDA position. We have improved our commercial terms with our customers and focused on improving
our operating performance, with a particular focus on better sourcing of raw materials and improved labour
efficiencies in our production activities.
The overall trading environment is increasingly positive with European OEMs reporting increased
production of vehicles and a reduction in supply chain disruptions. This is much welcomed after the key
component shortages and uncertainty of recent years. It provides a much more stable footing for the
Group to invest and grow. We benefitted from 11 new customer wins during FY23.
Over the year, we have made notable progress in many areas; we have been able to invest in new
machinery, resume capital repayments of our CBILS loan and change and expand the composition of our
Board. Further, the Group has focused on measuring and improving its environmental impacts with some
notable success.
Financial performance
Group sales in the second half of the year were £11.9m, up 26% on the equivalent prior year period (H2
22: £9.5m). Overall Group sales for FY23 increased by 20% to £22.7m (FY22: £18.9m).
Group automotive component sales grew by 31% in the year to £19.9m (FY22: £15.2m). It was pleasing
to see this growth across all of our geographies with the UK up 26%, Sweden up 23% and Germany up
55% (assisted by a full year effect of prior year new business wins). However, negative sentiment in the
flooring market in Germany continued, albeit we still saw overall sales growth in that region of 14% to
£7.5m (FY22: £6.6m).
Gross margin recovered to 29.5% (FY22: 22.4%) due to a combination of better commercial terms with
our customers and continued focus on manufacturing efficiencies.
The operating loss for the Group has reduced to £0.7m (FY22: loss of £3.0m).
Net debt (excluding IFRS 16 debt) decreased to £1.6m (FY22: £2.0m) and cash and cash equivalents
increased to £2.1m (FY22: £1.8m). This is due to the business generating net operating cash of £2.1m
(FY22: net operating cash loss of £0.5m) driven by the Group’s improved operating performance and
positive working capital management in the period.
We recommenced repayments of our CBILS loan in July 23 and, post year end, we have obtained further
banking support from both of our major lenders, with revised covenants and repayment profiles agreed
with both.
People
Our staff have yet again demonstrated their unwavering commitment and enthusiasm for the business.
They have reacted well to the increased activity within the business and continue to challenge costs and
strive for more efficiency. I would like to thank them all for their hard work during the year.
In May 2023, we appointed Andrew Burn to the Board as a Non-Executive Director to replace Neil
MacDonald, who stepped down in June 2023. Furthermore, after the year end we appointed Mark Taylor
as a Non-Executive Director. Both Andrew and Mark bring significant new skills and experience to the
Board which will strongly support the business in our strategic delivery.
We have also announced today the appointment of Andrew (‘Andy’) Bloomer as Chief Executive Officer with
effect from 22 April 2024. Gareth Kaminski-Cook will step down from the Board and his role of CEO at the
same time.
Andy brings extensive experience of the European automotive manufacturing industry, particularly with
electric vehicles and specialist fibre applications, having most recently held the role of Sales & Marketing
Director EMEA at London-listed Morgan Advanced Materials plc. Andy’s very relevant industry experience
and commercial focus will enable us to maximise the increasing opportunities that we are currently seeing
in the automotive market and accelerate our growth.
6
I would like to thank Gareth personally and on behalf of the Board for his dedicated service over the past
five years, resulting in the start of the recovery of the business over the past 12 months. We all wish Gareth
well in the future.
Environmental, Social and Governance
Our commitment to lower the environmental impact of our products has continued in FY23. Our
investment in R&D enabled us to launch our new recyclable Neptune-R material during the period. This
has generated strong interest from our customers, where the material has already achieved the highest
performance rating approval by one major OEM and others have partnered with us to develop new
thermal ducting products. We also believe that our products can support the thermal efficiency of the
cabins of vehicles which would have a beneficial impact for electric vehicles in reducing power loss to
heating of the cabin to the detriment of range.
We have dedicated more time to understanding our environmental impact as a business and considering
how we can seek to continuously improve such impact going-forward. We have reduced our carbon
footprint significantly in the year by changing our energy sourcing from 27% to 100% renewable sources in
both the UK and Germany. We will continue to focus on reducing overall energy used through ongoing
operational efficiency improvements.
During the year, through our operational improvement programme, we were successful in recalibrating our
Neptune production line to reduce off-cut waste. This contributed to a 64% reduction in waste year on
year. We will continue to challenge ourselves to reduce our environmental impact in all aspects of our
operations.
The Board remains committed to robust corporate governance and risk management to ensure the
delivery of our strategic ambitions and the financial health of the Group. We apply the Quoted Companies
Alliance Corporate Governance Code (the “QCA Code”). Since November 2023, the Board has increased
to three independent non-executive directors in line with QCA Code guidelines.
Outlook
The automotive market appears to be stabilising after a number of years of turbulence and uncertainty.
This should support the Group in delivering further growth in sales and profitability, a trend that has
continued into Q1 FY24. However, we anticipate that profitability in H2 FY24 will be affected by plans to
invest in sales, marketing and R&D, together with meeting statutory increases in salary costs.
Our focus now is to develop our commercial capability to deliver sales growth and embed Neptune-R
material with our customer base, especially in electric vehicles. We will seek to leverage our technical
capabilities to engineer innovative solutions for our customers and integrate ourselves further into their
supply chain. We will also continue to invest in new product development.
Overall, the Board believes that the Group will continue to stabilise its operating performance in FY24,
despite the risk of some fluctuations in model level volumes. However, the increasing level of
opportunities that we are seeing in the automotive market provide optimism for future sales growth.
Adam Attwood
Chairman
7
CHIEF EXECUTIVE OFFICER’S REVIEW
Automotive sales growth, margin recovery and new sustainable materials
The Group has delivered a much-improved financial performance this year and continued to build its
credentials as an agile engineering problem solver that specialises in providing innovative thermal and
acoustic solutions for electric vehicles using sustainable materials.
With great patience and support from our shareholders, outstanding cooperation and understanding of our
customers and exceptional commitment and hard work from the Autins team, we have transitioned from
survival to growth, and this has flowed through to an EBITDA improvement of £2.3m in the year.
Automotive sales growth
Neptune sales growth
31%
35%
100% recyclable NeptuneTM-R launched
11 new automotive customers
Thermal and acoustic solutions that contribute to a quieter, cleaner and more energy-efficient world.
We are acoustic and thermal specialists and apply our in-house materials expertise to manufacture products
that solve challenging engineering problems, primarily for the automotive, commercial vehicle and flooring
sectors.
We manufacture in the UK, Germany and Sweden and have world class quality and performance metrics,
making us a truly trusted, local European partner.
We have our own patented NeptuneTM technology which is manufactured in our UK facilities and provides
a real point of difference, as it is superior to all competitor materials in terms of reducing thermal losses and
acoustic noise, whilst boasting leading levels of recycled material content and recyclability.
A year of turnaround
I am pleased to report that the improvements reported at the half year continued to gain momentum as the
full impact of price increases, cost savings and better volumes further improved revenue, margins and
profit. This resulted in revenue growing by £3.8m, or 20.2%, margin recovery of 7.1% to 29.5% and a
£2.3m year on year improvement in EBITDA.
UK and Swedish automotive revenue grew 26% and 23% respectively and we were delighted to see our
German automotive sales grow by 55% as project wins, primarily with Neptune for EVs, began production.
The flooring market, however, remains depressed as European construction was negatively impacted by
the tough economic background, which restricted the overall growth in Germany to 14%.
Our Neptune product range had another strong year as sales grew 35% and is a key factor for winning
new business. In the year we won 11 new customers, 6 in UK and Sweden and 5 in Germany including to
supply into the all-electric Nissan Leaf, various JLR vehicles, Fisker Ocean, Lamborghini and a number of
tiers. The launch of our 100% recyclable Neptune-R is creating excitement in the customer base, as it
satisfies the strong desire by customers to move to ever more environmentally friendly solutions. VW have
approved it at a Class 1 acoustic level.
A value proposition built around strong ESG credentials
Customers increasingly want to source from companies genuinely committed to providing product solutions
with the best environmental credentials. New European standards are being introduced requiring minimum
recycled content in materials used and minimum recyclable content of the whole vehicle and this is why we
have developed Neptune-R and SilentShell, both single material products that can be recycled and Neptune
Green which has a higher recycled content. We are also maximising the recycled content within all our
products. The innovation strategy is prioritising thermal and acoustic solutions for electric vehicles (EVs)
made from materials with lower impact on the environment.
During the year we have worked with customers to reduce the thermal losses in their cars. In one case the
customer had an urgent issue where the cabins were overheating – the cool air in the HVAC ducting was
leaking out before it got to the cabin. Autins was drafted in and within 6 weeks had designed and moved to
full production of an engineered solution that not only made the cabin comfortable, but also draws less
8
energy from the battery and extends the vehicle range. We are now partnering on several strategic follow
up thermal projects for EVs to solve similar issues and also reduce the number of materials being used, the
process steps and the carbon footprint.
In last year’s report I stated a target to reduce our carbon emissions across the Group by 84%. We
managed to achieve a reduction of 88% across the Group by converting to renewable energy sources and
improving efficiencies in the plants, particularly on the Neptune line in Tamworth, where we have introduced
a “new to the world” in-line quality scanner. This gives us real-time quality control on every part of the
material produced, enabling us to reduce scrap and waste and reduce energy used, whilst improving the
customer experience. In the UK we also managed to reduce water usage by another 21%, by creating a
closed loop system, and overall waste was reduced by 38%.
I also stated that we needed to reduce the churn of staff from a post-Covid high above 30% to below 10%.
Through continuous engagement with our staff and a number of creative initiatives including the use of
banked hours, increased rates for overtime work and efficiency bonus schemes, we have met that target
and achieved a stable environment where the workforce and staff alike are again highly engaged and
motivated.
Transitioning to agile, Acoustic and Thermal NVH engineered solutions
We continue to focus on the future and growth. We know that we are price competitive and have a very
strong and trusted relationship with all of our customers, because of our culture and our quality and service
performance. We do not let customers down and we communicate proactively.
We are now at a point where we need to start investing carefully so that we capture the growth that is
available. We purchased a cut and seal machine for Germany so that we can keep up with demand from
VW and meet the demand from new customer Fisker which began production in April 2023.
Demand for NVH continues to grow as OEM’s seek more comfort, but now they also need to reduce the
thermal losses to protect battery range in their EVs and they need to do this with sustainable insulation
materials. Autins is perfectly placed to help our customers increase their vehicle range and increase
acoustic comfort with environmentally friendly solutions.
The strategy has therefore shifted to increase the total number of enquiries that come into the business and
the amount of time our commercial team can spend on proactively opening up new relationships and new
customers.
We have recently launched new products, but we also have a very exciting product development pipeline
coming through. These projects need pushing forward, so we have appointed a Thermal and Acoustic
Technical lead to accelerate them.
We are also rolling out a CRM system to increase the efficiency and transparency of our commercial
activities and to create more pull-through from our customer and prospect base, by running marketing
campaigns. This will be supported by dedicated outsourced marketing support.
Our people have again been fantastic. Their commitment and resilience during the last couple of years has
been inspiring and I would like to personally thank them for all their hard work and positive energy.
Much has been done, but there is much more to do. We will continue to manage our costs with prudence
and protect our margins, but growth is again our number one priority.
Gareth Kaminski-Cook
Chief Executive Officer
9
STRATEGY IN ACTION
Improving battery range whilst solving an urgent thermal engineering problem
In June 2023, we received a phone call from a Senior Engineer at a large customer saying they needed
help to solve a problem with the thermal insulation in their prestige vehicles. The existing solution wasn’t
working leading to numerous customer complaints. A new solution was needed urgently that could go into
full production within six weeks. Programmes like this would normally take between 8-12 weeks.
From previous experience with Autins, this engineer knew that Neptune technology would be a better
technical solution, because the thermal properties are superior, and Autins has the technical know-how,
attitude, and agility to solve such problems efficiently. However, this project needed a complete redesign,
approval of design, tools had to be ordered and only then could the production cells and staff be recruited
and trained.
Full production of 6,000 parts per week was achieved to quality specification, on cost and within time. The
thermal solution that we have provided is so well insulated that the cabin is now comfortable and energy
loss is reduced. Therefore, less energy is drawn from the battery, which protects the range of the
vehicle – a major benefit for all EVs.
Commenting on the project:
“This is exactly the kind of work in which Autins excels. Engineering problem solving of thermal or acoustic
challenges to produce a workable design, develop production processes and finally manufacturing high
quality products.
The Autins’ team prides itself on being collaborative with our partners, agile, technically capable, practical,
and fast. I am proud of the fact that on this project the cooperation and communication between all parties
was exceptional and we enabled all three companies to meet their goals.”
Gareth Kaminski-Cook CEO
10
OUR COMMITMENT TO ESG
Our future is about sustainable growth
(cid:2) Autins recognises that ESG should be a central commitment of the business to support
decarbonisation and a better environment, promote our social responsibilities and ensure fairness
and promote diversity
(cid:2) ESG is inexorably becoming a more important focus area for our customers and investors
(cid:2) We now have a well-established range of measures being monitored to help identify where we
should focus to improve our ESG performance
(cid:2) During 2023 we have hit our key targets to reduce CO2 emissions by 84% and to reduce staff churn
to less than 10% in the UK
Monitoring Strategy for ESG:
i.
ii.
iii.
Measure, monitor and manage continuous improvement of the key environmental data points
(energy, CO2 , water and waste)
Maintain low churn of the permanent staff across the Group
Reduce total energy used /£m of revenue through continuous operational efficiency
improvements
Environmental
Energy usage and Carbon emissions
(cid:2) Total energy usage:
o Energy usage Kw/h per £m of revenue reduced by 18%.
Energy Usage kw/h
Total Energy used in
buildings & process
KWh
KW/h per million
turnover
2019/20
2020/21
2021/22
2022/23
Autins Plc
2,777,674
3,682,169
3,175,250
3,142,772
114,699
138,292
148,348
122,168
21%
7%
-18%
(cid:2) Carbon footprint:
o This is the first year we have created a consolidated CO2 calculation for the Group.
o Total CO2 produced on a per £m of revenue basis, reduced by 88%, driven by our
move to renewable energy sourcing and improved operational efficiencies.
CO2e Emmissions
Autins Plc
2019/20
2020/21
2021/22
2022/23
Total kgCO2
6,050,415
7,064,662
6,082,790
861,983
tCO2 per million of
revenue
250
265
6%
284
7%
34
-88%
(cid:2) Water and Waste in UK:
o Water usage continued to reduce by a further 21% last year on a m3/£m of sales
basis.
11
(cid:2) Total waste
o produced has reduced by 38% measured on a tonnes/£m of sales. This means waste
has halved over the last two years as we recycle more and reduce scrap.
Social
Autins Group is very proud of its safety record, the quality of our products and services and the integrity in
the way we do business with all our partners and stakeholders. The way in which we do business is
underpinned by a core set of company values and a code of business ethics, which are set out within our
Annual Corporate Responsibility Report.
Reducing staff turnover rate in the UK, as a proxy for staff engagement, has been a target area for our
attention and we are delighted to report that we have reduced churn in the year from 34% reported last year
to 10% by the end of the financial year. Group churn rate was 6.5% for the year. We took a number of
actions including:
(cid:2) Salary increases ahead of the curve against role benchmarks and performance
(cid:2) We reduced our dependence on temporary labour so that permanent employees had stronger
work place stability, to engender better team work and given the increased need for overtime,
provide more opportunity for staff to take more money home with improved overtime rates
(cid:2) We introduced a banked hours scheme, so that we could guarantee a stable and steady monthly
income for staff and retain flexibility to ask staff to go home when we did not need them and
work extra hours when needed.
(cid:2)
Introduced a bonus scheme where the workers are rewarded if they have contributed to
increased productivity.
(cid:2) A suggestion scheme has been introduced which has generated a number of improvement
ideas every week in each location and actions or responses are provided with 24 hours
Governance
The Autins Board is committed to maintaining the highest possible standards of Corporate Governance as
set out in detail in the Investor section of the company website under the heading ‘Governance’.
www.autins.co.uk/investors/governance/
The Board undertakes from time to time a full QCA Board Effectiveness Reviews and formal anti-bribery
training, along with company management and staff.
“We are an international business operating in the global community – we take our responsibility to be a
good corporate citizen seriously.”
Gareth Kaminski-Cook
Chief Executive Officer
12
OUR STAKEHOLDERS
The Board believes that to maximise value and success in the long-term, it must engage and consult with
its stakeholders to develop effective and mutually beneficial relationships with them and, ultimately, to
make better business decisions. The Board considers the key stakeholders to be as detailed below.
Employees
Striving to create a larger, more profitable Group, should create an exciting future where more people are
employed doing work that is motivating. Our staff can expect to work in a safe environment where people will
be treated fairly and with respect. Our teams will be challenged and constantly learn, so that we can empower
them to be part of something important.
Customers
We have a unique product offering, due to our breadth of materials, products, UK manufactured Neptune
non-wovens and manufacturing processes and a highly responsive technical support service, which we
believe is highly valued by our customers.
Shareholders
Management is fully committed to execute a growth strategy and bring the business to a condition where it
provides positive returns for our investors
Suppliers
Our suppliers should share in the benefit of Autins’ success, which will be founded on delivering exceptional
service to our customers, proving our reliability, complete supply chain transparency and a willingness to
align as partners including a commitment to meet UK Carbon emission targets
Regulators
Autins will observe complete transparency in all dealings with the relevant regulators and in fulfilling its
obligations of governance.
Communities
Autins proactively engages with its local communities as part of its approach to Social Responsibility. This
includes being aware of our impact on and taking a responsible approach to the environment, the
communities we work within and governance compliance.
13
DIRECTORS’ SECTION 172 STATEMENT
The Board of Directors consider that they, both individually and collectively, have acted in a way that would
be most likely to promote the success of the Company for the benefits of its members as a whole (having
regard to the stakeholders and matters set out in Section 172(1) (a-f) of the Act) in the decisions they have
taken during the year ended 30 September 2023.
In making this statement the Directors considered the longer-term needs of stakeholders and the
environment and have taken into account the following:-
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
the likely consequences of any decisions in the long term;
the interest of the Company’s employees;
the need to foster the Company’s business relationships with suppliers, customers and others;
the impact of the Company’s operations on the community and the environment;
the desirability of the Company maintaining a reputation for high standards of business conduct; and
the need to act fairly as between members of the Company.
14
FINANCIAL REVIEW
Repositioning, Restructuring and Reaching for Gains
Significant financial performance improvement achieved in FY23 over FY22:
(cid:2) Revenue increased by 20.2% to £22.7m
(cid:2) Gross profit increased to £6.7m from £4.2m
(cid:2) Gross margins recovered from 22.4% to 29.5%
(cid:2) EBITDA improved by £2.3m to £1.2m
(cid:2) Cashflow from operating activities significantly improved to £2.1m
(cid:2) Operating working capital improved by £0.8m
(cid:2) Cash and equivalents increased to £2.1m from £1.8m
(cid:2) CBIL loan repayments were recommenced in July 2023
Key actions taken to reposition the business:
(cid:2) New contracts were won which have growth potential for 2024 and beyond
(cid:2) Contractual pricing and margin improvements achieved
(cid:2) Restructuring and labour productivity gains continued to offset labour rate increases
(cid:2) Materials projects for both cost and efficiency were instrumental to gross profit improvement
(cid:2) Utilities costs were hedged in April 2022, helping to contain subsequent global rate increases
(cid:2)
In isolation, the completed actions had an annualised profitability run rate improvement that was
greater than £2.5m
Investment spend continued during the year, including new equipment and premises being
acquired in Germany.
(cid:2)
Trading Performance £000
H1
H2
Revenue
Gross Profit
Gross Margin %
EBITDA
Cashflow from Operating
Activities
Debt and Cash Headroom £m
Net Debt*
Cash and equivalents
Cash Headroom
Loans and Borrowings*
*Excluding IFRS16 lease liabilities.
10,843
3,063
28.2%
360
357
H1
2.42
1.3
3.5
(3.7)
11,836
£3,619
30.6%
805
FY23
22,679
6,682
29.5%
1,165
FY22
18,873
4,235
22.4%
(1,150)
1,711
2,068
(535)
H2
1.55
2.1
4.1
(3.7)
FY23
1.60
2.1
4.1
(3.7)
FY22
2.0
1.8
3.5
(3.8)
FY23 Performance Overview
A number of planned repositioning actions were taken during the year, which improved the financial
performance of the Group. Significant customer contract and price improvements were largely concluded
during H1, albeit some further improvements did continue into H2. Materials improvement projects were
mostly implemented during H1 and these had full impact in H2.
Staff restructuring actions were initiated in October 2022, and these started to deliver benefits from
December 2022 onwards. Our staff’s response to this process was excellent, and all worked co-operatively
with us throughout. Subsequently they accepted targets to improve productivity, adopted multi-skilling and
simultaneously embraced a flexible two-way banked hours and enhanced overtime regime, which enabled
them to improve their personal earnings, whilst assisting smooth production for the Group and improved
cost control.
15
New waste management and recycling initiatives also assisted profitability, and reduced our carbon
footprint. Utilities costs, driven by macroeconomic circumstances, increased year on year for the Group by
c.£0.5m, albeit the impact was contained through forward contract arrangements. Ultimately these increases
were more than offset by the other efficiency actions noted above. A decision was also taken to move
towards renewable energy sources even though there were some adverse short term cost implications of
this.
Overheads were largely consistent year on year with planned improvements offsetting general inflationary
factors. In Germany, we invested in a further storage location, which added to overhead costs and also
purchased new critical capital equipment. This was to help accommodate volume recovery for their key
customer and growth in other automotive contracts, whilst simultaneously improving efficiency and capacity.
In summary, in FY23 the Group improved revenues, margins and costs resulting in a £2.3m EBITDA
increase over the prior year. This, coupled with strong working capital management, improved Cashflow
from operating activities to £2.1m. Enhanced backdated R&D cash tax credits of £0.3m were also received,
and disposal of our JV share to our JV partner, Indica Industries, for £0.3m immediately prior to the year-
end also realised a further gain of £0.2m. All actions combined with improved trading, meant that, as at 30
September 2023, cash and equivalents had improved by £0.3m and net debt, excluding IFRS16 liabilities,
by £0.4m, as compared to the prior year, with H2 performance being markedly stronger than H1.
Revenues and Margins
Revenues increased significantly across all Group companies in FY23. Germany based automotive OEMs
experienced solid volume recovery, which was mirrored in their purchases from Autins GmbH. However,
flooring sales in Germany did decline in line with household economic conditions. Recovery in the UK was
much more muted, and H1 actually experienced some volume reduction from extended semi-conductor and
other supply chain disruption, which then eased in H2. The UK business won a significant new contract that
commenced in July 2023, which added to H2 performance and will have a revenue impact in excess of £1m
in FY24. In Sweden, revenues increased by 23%, mainly reflecting volume recovery as well as some small
new contract wins.
Neptune sales continued to grow in both absolute value and as a proportion of overall Group revenue. This
included new pioneering BEV range improving thermal applications, in which Neptune was technically
proven to be the class leading material. Neptune growth usually improves overall Group margin as our
internal fixed cost absorption also increases, as compared with fixed margins on bought in materials.
Group gross margins improved by 7.1%. Most of this improvement came from customer price and contract
improvements and the impact of new contract wins. The remainder of the improvement primarily derived
from materials projects and labour restructuring. Currency movements also assisted recovery in H2 as US$
denominated materials purchases, that were considerably impacted with weak GBP against US$ in Autumn
2022, then steadily improved as GBP recovered back towards US$1.30. Utilities cost increases had an
impact as described above.
From a country perspective gross margins recovered in the UK by 11.8%, remained consistent in Sweden,
and reduced in Germany by 2.3%, where materials costs and operational challenges restricted some of the
expected recovery. Gross margin recovery is, of course, pivotal in repositioning the trading position of the
Group for profitable future growth, and further actions are ongoing to assist with this.
Other operating costs and EBITDA
In the UK the national minimum wage increased to £10.42 from £9.50 in April 2023, a 9.7% increase. In line
with this, we increased all our UK production hourly pay scales. Multi-skilling, productivity and other
progressive performance criteria allow our staff to earn well above the minimum wage rate, and our flexible
overtime and banked hours arrangements help give staff some control over total earnings and work life
balance. This in turn improves production flows that optimise total labour and other variable costs, which
improve profitability. Staff retention was also strong, and allowing for retirees and redundancies, was
measured above 92% for the year.
Transport costs across the Group also improved, driven by rate negotiations with suppliers and improved
planning and logistics, coupled with smoother schedule requirements from customers. Conversely, there
were general inflationary factors in many other cost categories, the most notable being energy as described
above. The Group also incurred some non-repeating expenditure and one significant key customer bad
debt. The total cost of these items was £0.25m, charged in Administrative expenses. Combined Distribution
and Administrative expenses were £7.4m, compared with £7.2m in the prior year. Again, these increases
were more than offset by other actions and cost control measures already described resulting in EBITDA
improving by £2.4m, as noted above.
H2 EBITDA at £0.81m was also significantly ahead of H1 EBITDA of £0.36m. H2 Cashflow from operating
activities was £1.71m, being significantly ahead of H1 at £0.35m. This validates the impact of the profit
16
improvement actions and helps demonstrate the performance run rate that we are building from into FY24.
Loss before tax
The total depreciation and amortisation charge for the year was consistent with the prior year at £1.9m. The
finance expense reduced slightly to £0.5m (FY22 £0.54m) as some capital repayments were made on fixed
rate borrowings. There was a £0.2m profit on disposal from our JV share to our JV partner Indica industries.
Existing customer contract product supply was secured with a simultaneous new exclusive agreement
signed with Indica UK.
Currency
The Group’s overseas operations and certain key raw material suppliers require the Group to trade in
currencies other than Sterling, its base currency. During the year, operational transactions were conducted
in US Dollar, Swedish Krona and Euro. Certain key raw materials for production are currently imported from
South Korea with transactions conducted in US Dollars. The Group has taken steps to mitigate overall
sourcing and currency risks by establishing alternative purchase sources which can be transacted in
alternative currencies.
With Euro revenues and Neptune sales both continuing to grow, the Group continues to benefit from natural
hedging, arising from its structure and trading balances, which means that the Group’s results in both FY23
and FY22 have only been marginally impacted as a result of currency translations. In H2 the Group has
made use of a new forward currency buying facility to partially hedge currency exposure for between 6-12
months on a rolling basis. Formal hedge accounting has not been adopted.
Borrowing and Net finance expense
Total borrowings for the Group reduced slightly to £3.7m (FY22 £3.8m), with CBIL loan repayments
recommencing in July 2023, whilst HP liabilities slightly increased following the purchase of new plant and
equipment in Germany in H2. The UK Invoice Finance facility remained entirely undrawn at the year end.
All term loans have fixed interest rates, and the slight reduction in the finance expense is a consequence of
borrowing reduction following repayments made. As noted above, cash and cash equivalents increased
year on year and overall cash headroom remains strong. This assists our ability to make significant capital
repayments for both the CBIL and MEIF term loans in the coming year. The Group has agreed a revised
repayment profile for the MEIF term loan, which requires full settlement by 31 December 2024. The lender
has also waived covenants indefinitely. Payments for the MEIF loan had previously been paused, and
repayment is subject to compliance with revised CBIL loan covenants, recently agreed with HSBC to
facilitate this.
The Board continues to review the Group's banking and funding arrangements with a view to ensuring that
they remain appropriate for its planned growth.
An analysis of the net finance expense is presented in note 8 on page 69.
Cash, working capital and net debt
The Group ended the year with an improved net debt position of £1.6m excluding IFRS16 calculated lease
liabilities (FY22: £2.0m).
The Group has continued to optimise working capital during the year. Special focus remains on timely
collection of trade debtors and timely payment of trade creditors. Active customer credit terms management
also released in excess of £0.4m of cash across the Group. Far East purchases are obtained on open credit
terms from the respective suppliers. The Group continues to hold c.£0.3m of strategic buffer stocks, albeit
these have reduced since the prior year as supply chain issues eased. In total, operating working capital
improved by £0.8m across the Group, despite increasing sales.
Taxation
The effective tax rate in the year was below that expected based on current UK corporation tax levels. Given
the quantum of available tax losses compared to expected profitability in the next two years, the Group has
not recognised the majority of current year losses as a deferred tax asset.
The Group’s technical and R&D teams have, as in prior years, continued to enhance materials applications,
improve processes and develop new products. The Group strategy remains to utilise losses to obtain actual
R&D tax credit cash refunds to maximise liquidity. An R&D tax credit claim was submitted for FY22 in
September 2023 and £0.1m of cash has been received subsequent to the FY23 year-end (FY22: £0.1m
cash received).
The Group’s German subsidiary has largely utilised its historical tax losses, which may result in a degree of
tax at a higher rate on future profits in Germany. Brought forward taxable losses are available in Sweden
17
that will, in the short term, at least partially offset their expected trading profits. Transfer pricing principles
are actively considered and managed across the Group, which helps to optimise the combined tax position.
Earnings per share and Dividends
Loss per share was 1.67 pence (FY22: Loss per share 6.34 pence) reflecting the reduced loss in the year.
The weighted average number of shares was 54,600,984 in the year (FY22: 51,683,793). The Board are
not proposing a final dividend for the current year (FY22: £nil) and no interim dividend was paid (FY22: £nil).
Going concern
The financial statements, based on current and forecast trading, the annual cash flow forecasts, and the
available sources of finance, have been prepared on the going concern basis, further details of which are
provided in note 1 of the financial statements.
Financial risk management
Details of our financial risk management policies are disclosed in note 3 on pages 63 to 66.
Kamran Munir
Chief Financial Officer
1 March 2024
18
KEY PERFORMANCE INDICATORS (‘KPIS’)
Lost Time Injury Frequency Rate (‘LTIFR’)
2023: 3.4
2022: 0.0
KPI Definition
LTIFR is calculated as the number of lost time injuries leading to more than one day off work, divided by
one million and multiplied by the number of hours worked.
(One incident would represent 3.4 for FY23)
Comment
One incident in the year resulted in lost time (being more than one day away from work as a result of an
incident at work).
The business has had no RIDDOR reported incidents since 2017 and one lost time incident in the last five
years. Given this consistent good performance, management continue to strive on being incident free and
focus on mental health and wellbeing in the workplace.
Gross profit growth (£)
2023: +57.8%
2022: -33.1%
KPI Definition
Measure is calculated as the change in gross profit from continuing operations in the current year compared
with prior year.
(Target: CAGR 15-20% over 3-5 years)
Comment
Gross profit increased, due to a 20.2% growth in revenue and actions taken to improve margins.
Non-UK revenue as a proportion of consolidated sales (%)
2023: 43%
2022: 44%
KPI Definition
Measure is calculated as the value of external sales for German and Swedish operations as a proportion
of total revenues.
(Target: 35% over 3-5 years)
Comment
Sales grew in all three territories, however the recovery of UK automotive sales outweighed the growth in
Germany and Sweden.
Organic revenue growth (%)
2023: 20.1%
2022: -19.5%
KPI Definition
Organic revenue growth measures the change in revenue in the current year compared with the prior year
from continuing operations.
The effects of any acquisitions in the current or prior year are adjusted.
(Target: CAGR 15-20% over 3-5 years)
Comment
The strengthening automotive markets drove the growth of organic revenue despite weaker flooring sales.
19
EPS growth (%)
2023: 74.0%
2022: -131.0%
KPI Definition
EPS growth measures the change in basic earnings per share in the current year compared to that of the
prior year.
(Target: CAGR 15% over 5 years)
Comment
There was a significant performance improvement in FY23 resulting in lower losses.
New product & customer sales as a % of Group sales (%)
2023: 67.9%
2022: 69.8%
KPI Definition
New product and customer sales are measured as the combined revenue generated from products
(primarily Neptune) and customers secured by the Group in the current and previous three years, as a
percentage of total revenue from continuing operations. This measure includes revenue from products
related to renewed customer platforms that were subject to competitive bids.
(Target: over 20%)
Comment
New product and customer sales remained stable as a result of the steady replacement of product sales
from existing customer platforms, complemented with new product launches, as well as significant new
customer wins in FY23. Flooring business revenues were mostly won over the last four year period and so
remain substantively within the calculation.
20
PRINCIPAL RISKS AND UNCERTAINTIES
Key Risk
Risk Details
Mitigation
European car
sales remain
lower than pre-
Covid levels
European OEMs are
looking to focus less on
the more competitive low
end of the market and
post-Covid recovery is
being slowed down
because of consumer
uncertainty as to how to
navigate the transition to
electric vehicles.
Autins has only a c.4% market share of the European
market for Thermal and Acoustic NVH. Autins' core
market is the executive and luxury vehicle segment,
which is more resilient to the economic shocks and
where overall demand per vehicle for Acoustic,
Thermal protection and NVH treatment is still set to
grow significantly. Our Neptune technology and
sustainable product solutions, recyclable Neptune-R,
Neptune Green and Silentshell have a superior
performance and are well positioned to meet these
Thermal and Acoustic needs.
Failing to
successfully
implement our
growth
strategies
Our future success
requires continued
success in diversifying the
customer base and
regional sales.
The Group has diversified its customer base from 9
to over 100 over the last 7 years, European sales
represent 39% and Flooring 11% of Group turnover.
We will continue to build the breadth and depth of
relationship with our customer base and supplement
that with pull through marketing activity.
Over-
dependence on
key customers
All countries have a high
customer concentration
with the largest customer
representing c.60% of
Group revenue.
Dependence on our major customer has reduced to
c.60%, and the relationships with all major customers
are very good as evidenced by the support given
when we required price increases at the beginning of
the financial year. Our value proposition and the
unique selling points of Neptune has meant in the
last financial year the Group has gained 5 new
customers, with supply of prototypes to a further 6
companies. The target addressable market within our
specialist area of automotive NVH is significant and
therefore provides huge potential for more customer
diversification and market share gain.
Retention of key
staff in
business-critical
roles
The Group has a high
level of reliance on certain
individuals in key roles
both for operational
management and for key
external relationships and
growth.
We have a highly collaborative and respectful culture
and regularly meet with all senior and key team
members so that people feel included. This does
seem to foster a highly engaged and motivated team.
We conduct bi-annual staff surveys and hold site
meetings with staff and the Leadership team at least
twice a year. The employee turnover in the Group in
the year was 6.5% and is considered to be at a
healthy level indicating strong employee
engagement.
21
Key Risk
Risk Details
Mitigation
Dependence on
relationship with
IKSung, and
supply
interruption
The licensor of the
intellectual property rights
related to Neptune,
IKSung, are the supplier
of patented and non-
patented ingredients used
in manufacture of the
patented materials. There
is potentially a risk if this
relationship were to
deteriorate and if we have
not reduced dependence
on the materials and
support they supply.
Relationships with IKSung are stable, but alternative
suppliers have been secured for all non-patented
materials within Neptune.
The licensing agreement conveys the right to source
the proprietary fibre directly from the manufacturer (a
large third party material producer) in the event of
IKSung being unable to do so and alternative
emergency supply sources have been identified.
The development of Neptune-R reduces our
dependence on IKSung as this specific product does
not use material sourced from IKSung.
Major failure of
Neptune line
The Group’s Neptune
production line is the only
such facility in Europe.
New
technologies
emerging to
render
traditional
passive NVH
solutions for
Thermal,
Acoustic and
NVH treatments
obsolete or less
attractive and
Neptune less
unique and less
competitive
Risk of new NVH
technologies (e.g. active
sound control) emerging
that usurp passive
resistance solutions
reducing our NVH market
size and/or emerging
technologies that reduce
the competitiveness of
Neptune
Investments made during the extended installation
and commissioning phase included automated
process control and diagnostic systems not
employed by IKSung that allow for more effective
identification and resolution of faults.
In addition, the Group maintains a critical spares
package for the line and has a number of specialist
engineers who have received maintenance training.
The Group has a schedule of preventative
maintenance and repairs in addition to the extensive
clean down and inspection completed at the end of
each production run.
The Group also has an ongoing technical support
agreement with IKSung for major machine failures
and a back-to-back agreement is held which would
allow material to be imported to support demand.
We have arrangements in place with IPC (North
American based manufacturer of Neptune) to provide
backup volumes as and when needed .
New technologies such as active sound control will
only be used to provide more "luxury experiences",
such that it does not replace the traditional passive
NVH solutions that Autins can provide. In addition,
the industry is consistent in stating that no new
material technologies are expected to replace the
very cost and performance efficient existing materials
- nano treatments will be expensive and specialist for
some time. Having developed Neptune-R, Neptune
Green and SilentShell we must continue innovating
to find ever higher performance and more
sustainable solutions. We have also filed our own
applications based patents, such as for
encapsulation and Trademarks such as SilentShellTM.
In addition we have also innovated our manufacturing
processes, notably introducing a "new to the world"
in-line density scanner to the Neptune manufacturing
line, which uniquely measures material quality across
the whole width of the material as it is being
manufactured.
22
Key Risk
Risk Details
Mitigation
Interruption of access, or
loss of the systems could
negatively affect the
Group’s ability to produce,
despatch and invoice
customers as well as
interrupt the smooth
running of its own supply
chain. The latter could
also be impacted by
cyber-security issues, for
example if data transfer or
integrity was impacted.
In addition, the
Automotive industry is
moving to adopt
ISO27001, or in Europe
the TISAX protocol, so
that we will need to meet
these standards.
A growing proportion of
the Group’s business is
carried out in currencies
other than Sterling. The
Group’s financial position
or results of operations
may be impacted to the
extent that there are
fluctuations in exchange
rates.
Security of the
software
systems,
hardware and
Cyber Security
Currency and
foreign
exchange
Sustainability
and ESG
Sustainability and ESG
are becoming ever more
important topics for our
stakeholders, particularly
shareholders and
customers.
The Group has invested in its IT infrastructure in
order to both improve operational functionality and
also protect sensitive and proprietary data from
cyber-attacks. Specialist third party IT support
consultants are employed, with the use of multi-layer
data backup and storage. A working group has been
established to ensure the company conforms with
ISO27001 and TISAX, so that we maintain our
supplier status to the automotive OEMs.
The Group maintains banking facilities in the
functional currency of overseas operations and
continues to seek, where possible, to buy materials
and services locally to the procuring site so as to
minimise transactional risk. Some natural hedging
prevails between Euro income and US$ purchases,
against our £GBP base currency. We have recently
started placing forward currency contracts between
US$/Euro to cover residual risk.
We have a Sustainability Policy document and issue
a CSR Report annually.
We have targets for Carbon zero and we are already
ahead of target to achieve 68% improvement by
2030, having achieved an 84% reduction last year in
Scope 1 emissions.
We also reduced waste by 66% and water usage.
We are rated on the FinnCap ESG monitor as top
quartile in governance.
The Strategic Report was approved by the Board on 1 March 2024 and signed by order of the Board by
the Chairman.
Adam Attwood
Chairman
1 March 2024
23
GOVERNANCE
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
IN RESPECT OF THE ANNUAL REPORT AND ACCOUNTS
The Directors are responsible for preparing the Annual Report and financial statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare Group and Parent Company financial statements for each
financial year. As required by the AIM Rules for Companies, they are required to prepare the Group financial
statements in accordance with applicable law and International Accounting Standards in conformity with the
requirements of the Companies Act 2006 and have elected to prepare the Parent Company financial
statements in accordance with UK Accounting Standards and applicable law (UK Generally Accepted
Accounting Practice), including FRS 101 Reduced Disclosure Framework. 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 Group and Parent Company and of the profit or loss of the Group for that period. In
preparing each of the Group and Parent Company financial statements, the Directors are required to:
●
●
●
●
●
select suitable accounting policies and then apply them consistently;
make judgements and estimates that are reasonable and prudent;
for the Group financial statements, state whether they have been prepared in accordance with
International Accounting Standards in conformity with the requirements of the Companies Act 2006;
for the Parent Company financial statements, state whether applicable UK Accounting Standards have
been followed, subject to any material departures disclosed and explained in the financial statements;
and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that
the Parent Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and
explain the Parent Company’s transactions and disclose with reasonable accuracy at any time the financial
position of the Group and the Parent Company and enable them to ensure that its financial statements
comply with the Companies Act 2006. They are also responsible for taking such steps as are reasonably
open to them to safeguard the assets of the Group and the Parent Company and to prevent and detect fraud
and other irregularities.
Website publication
The Directors are responsible for ensuring that the Annual Report and the financial statements are made
available on a website. Financial statements are published on the Company’s website in accordance with
legislation in the United Kingdom governing the preparation and dissemination of financial statements, which
may vary from legislation in other jurisdictions. The maintenance and integrity of the Company’s website is
the responsibility of the Directors. The Directors’ responsibility also extends to the ongoing integrity of the
financial statements contained therein.
24
BOARD OF DIRECTORS AND SENIOR MANAGEMENT
Adam Attwood
Non-Executive Chairman
Adam joined the Autins’ Board in January 2016 as Non-Executive Chairman. He has many years’
experience of working with growth-focused SMEs. Originally a corporate solicitor with Norton Rose Fulbright,
he moved into quoted company advisory and European M&A with Charterhouse Bank. He progressed to
direct private equity investment with Livingbridge Equity Partners focusing on investments in the Midlands
region. Adam has a portfolio of non-executive roles with manufacturing and branded businesses. Adam
chairs the Group’s Nominations Committee.
Gareth Kaminski-Cook
Chief Executive Officer
Gareth joined Autins in October 2018 and has 30 years of international business experience in market-
leading industrial organisations across several business sectors, having worked previously for Low & Bonar,
Saint-Gobain, Rexam, BPB and Danaher. He has a deep understanding of the manufacture and application
of technical material-based solutions in relevant industrial sectors including automotive, flooring and building
products.
Mark Taylor (appointed 13 November 2023)
Non-Executive Director
Mark was appointed to the Board on 13 November 2023 as a Non-Executive Director and is Chair of the
Audit Committee. He is a highly experienced chartered accountant and a member of the ICAEW. He has
worked in the accountancy profession throughout his career at KPMG, Baker Tilly and ultimately
for 19 years as a partner in Grant Thornton, before retiring in 2019. He was an audit and transaction support
in his final eight years with Grant Thornton. Mark’s experience
partner specialising in due diligence
covered many sectors
the automotive supply chain. He has also served as a non-
executive director and chair of the audit and remuneration committee of Tandem Group plc since 2019.
including
Andrew Burn
Non-Executive Director
Andrew is a chartered accountant and a fellow of the ICAEW. He spent over 20 years at KPMG where he
was a partner and during COVID-19 was the Head of Automotive in the UK. He has advised extensively in
the sector and has a strong network of senior relationships with many automotive OEMs and suppliers.
Prior to KPMG Andrew worked for a number of years at N M Rothschild & Sons Limited.
Kamran Munir
Chief Financial Officer and Company Secretary
Kamran is a highly experienced strategic and operational CFO, with a 20-year background of large corporate
and VC roles in manufacturing, aerospace and technology companies. Prior to Autins, Kamran worked for
Precision Castparts Corp, as Finance Director for Special Metals Limited and more recently European
Finance Director for Timet Division, driving integration, culture change and improvements in profitability and
value. Kamran was also European Financial Controller for SPX Corporation, and CEO of Spectral Fusion
Technologies. On a voluntary basis, he remains CFO for the Coventry Refugee & Migrant Centre, as well
as being the founding trustee and CEO of The Open Hearts, Open Minds Foundation, which focuses on the
relief of poverty and sickness and the advancement of education. Kamran holds the ACA qualification and
is a graduate from the University of Cambridge (MA).
25
Henrik Pettersson
Operations Manager, Autins AB
Henrik brings 20 years’ experience in the automotive industry, progressing rapidly from operator to
operational manager for Schenker Automotive’s direct sequenced supply to Volvo. Henrik played a leading
role in the creation, management and development of Autins’ Swedish site, with a keen eye on cost, agility
and automotive best practice. Since April 2019, Henrik has been the in-country manager for Autins’ Swedish
operations bringing in Group support to facilitate operational scaling as required. Henrik has a master’s
degree in Electricity and Signal Technology from the University of Borås, Sweden.
Matthias Migl
Managing Director, Autins GmbH
Matthias has 25 years’ experience in the automotive industry including with the specialist NVH and soft trim
component manufacturer HP Pelzer Group, with a particular focus on acoustics. Matthias has been
Managing Director of Autins GmbH since 2013 and holds a degree in Chemical Engineering from Friedrich
– Alexander University, Erlangen, Germany.
26
CORPORATE GOVERNANCE STATEMENT
FOR THE YEAR ENDED 30 SEPTEMBER 2023
The Group has adopted the QCA Corporate Governance Code for Small and Mid-Size Quoted Companies
(the ‘QCA Code’) since September 2018. This is in line with the Board’s stated aims of seeking to apply, or
work towards, best practice for smaller quoted companies. The Group remains subject to the UK City Code
on Takeovers and Mergers.
The Directors note that a revised QCA Corporate Governance Code was issued on 13 November 2023,
which will apply to financial years commencing on or after 1 April 2024. The Directors will consider the
implications it has on the Group’s corporate governance over the coming year.
The statement on Corporate Governance below should be read in conjunction with relevant sections of the
of this Annual Report and Account which are cross referred from these pages and the Group’s website –
www.autins.com.
QCA Principle 1: Establish a strategy and business model which promote long-term value for
shareholders
Leadership and day-to-day management of the Group is the responsibility of the Chief Executive. The
executive directors, in conjunction with the leadership team formulate, review and recommend the Group’s
strategy for Board approval as part of the annual planning cycle. The leadership team will then take
ownership of specific policy deployment plans that are designed to implement and promote the approved
strategy in addition to delivery of annual financial plans.
The Group’s business model has been designed to deliver sustainable, long term, profitable growth. As a
partner of choice for the automotive industry, we generate growth by providing differentiated acoustic and
thermal products with a clear benefit to the customer. We do this through a high-performing, values-led
organisation focused on delivering our strategic goals.
QCA Principle 2: Seek to understand and meet shareholders needs and expectations
The Group seeks regular dialogue with both existing and potential shareholders in order to confirm that our
wider investor relations plan has allowed investors to clearly understand the strategy, business model and
performance.
The executive directors meet regularly with investors and analysts and also host tours of our facilities in
order to facilitate open communications regarding the Group’s business performance (both current and
expected future) and reconfirm the Board’s understanding of shareholders’ expectations and needs with
regards the Group.
The Board recognises the importance of the Annual General Meeting (‘AGM’) and therefore encourages
participation by all investors at the AGM. All Board members present at the AGM therefore make themselves
available to answer any questions from shareholders that may arise.
The results of the AGM are subsequently published on the Company’s corporate website and are
announced through a regulatory information service. The Board will also disclose any actions to be taken
as a result of resolutions, for which, votes against have been received from at least 20 per cent of
independent shareholders.
The Group has not appointed a Senior Independent Director but considers annually whether one should be
appointed.
QCA Principle 3: Take into account wider stakeholder and social responsibilities and their
implications for long-term success
The Group has adopted the finnCap Environmental, Social and Governance (‘ESG’) framework (as
recommended by the QCA) to measure and improve its ESG policies and procedures. The Group
recognises the need to maintain effective working relationships across a range of stakeholder groups
including its employees, customers, suppliers, shareholders and the wider community in which it operates
– the Group’s commitment to stakeholder engagement is set out on page 13. The Group’s commitment to
effective ESG governance is set out on pages 11 to 12.
The Board’s primary responsibility is to promote the success of the Group for the benefit of its members,
but the Board recognises its obligation to balance the Group’s operations and working methodologies to
take account of, and balance with, the needs of all of the wider shareholder groups. Where feedback is
received from stakeholders, the Group endeavours to make appropriate amendments to working
arrangements and operational plans to address this feedback whilst remaining consistent with the Group’s
longer-term strategies.
27
The Group continues to promote Autins’ Values, a set of six principles designed to influence the way we
work together, drive performance and inform our response to stakeholder needs and the Group’s
responsibilities to them.
QCA Principle 4: Embed effective risk management, considering both opportunities and threats,
throughout the organisation
The Audit Committee provides guidance; having taken feedback from management and third party advisors,
to the Board with regards the effectiveness of the Group’s system of Internal Control. The Group has
designed and implemented systems to manage, limit and control the risk of failure to achieve business
objectives. As with all systems, the Group’s processes cannot eliminate all risk completely, but provide
reasonable rather than absolute assurance against material loss or misstatement.
The Chief Financial Officer leads a continuous process, with support from the leadership and finance team,
to identify, evaluate and manage the Group’s significant risks. The Group’s register of potentially material
or significant risks are reviewed by the Board twice per annum.
As an SME, the executive directors, supported by the Group’s leadership team, are actively involved in the
daily management of all aspects of Group operations and meet on a regular basis to discuss:
●
●
●
●
●
●
Quality, environmental and health and safety performance.
Monthly financial and commercial results of the business compared to forecast.
Achievement against annual policy deployment activities that support the Board’s delivery of the
strategic plans.
Business risks and appropriate control systems improvements to manage those risks.
Progress on performance improvement projects.
Steps taken to embed internal control and risk management further into the Group’s operations.
On a monthly basis, agreed financial and non-financial KPIs together with management accounts are
reviewed by the Board to assess progress against its key objectives for the year. The executive directors’
provide a supporting written commentary in order to highlight key areas of performance and address
previously agreed areas of interest. These KPI’s, management accounts and more detailed departmental
level data are cascaded via the leadership team throughout the organisation.
The Board further considers whether any significant strategic, organisational or compliance issues have
occurred (or are at risk) to ensure that the Group’s assets are safeguarded and financial information and
accounting records can be relied upon.
A summary of the principal risks and uncertainties facing the Group, as well as mitigating actions, are set
out on pages 21 to 23 of this report.
QCA Principle 5: Maintain the Board as a well-functioning, balanced team led by the Chair
Role of the Board
The Company and Group are managed by a Board of Directors, chaired by Adam Attwood, who are
ultimately responsible for taking all major strategic decisions and also addressing any significant operational
matters whilst overseeing that good governance is maintained across the Group. Deployment of the Group’s
strategy and management of day-to-day decisions is delegated to the executive directors and the leadership
team. The Board also reviews the Group’s risk profile and the adequacy of the implemented systems of
internal control that are in place. The management information systems continue to be evolved to adapt to
changing data enquiry needs and to ensure that they are capable of facilitating informed decisions by the
Board to allow them to properly discharge their duties.
Delegation of responsibilities
The Group maintains a formal schedule of matters reserved for the Board which is reviewed at least
annually. A schedule of delegated authorities under which management can operate without reference to
the Board exists and was last reviewed, revised and approved by the Board in January 2022.
Board composition
The Board from 13 November 2023 consists of two executive directors, a non-executive chair and two
independent non-executive directors. During the year ended 30 September 2023 there were two non-
executive directors who were considered to be independent of management by the Board and were free
from any business or other relationship that could materially interfere with the exercise of their independent
judgement in accordance with the QCA Code. .
The Group considers annually whether a Senior Independent Director should be appointed but has not
28
currently chosen to do so.
The Board are satisfied that they have sufficient members and with an appropriate balance of skills and
experience to allow it to operate effectively and exert control over, and provide challenge and guidance to,
the business and its management team. No individual Board member has unconstrained powers to make
decisions of a material nature.
Role of Chair and Chief Executive
The Chair and Chief Executive Board positions are separate with clearly defined individual duties and
responsibilities. The Chair is responsible for the leadership and management of the Board and its
governance and as such meets regularly and separately with the executive and non-executive directors to
discuss matters for the Board.
The Chief Executive is responsible for day-to-day management and leadership of the Group. This includes
guiding the leadership team, in its formulation, review and confirmation of the Group strategy for Board
approval and subsequent execution.
The Board convenes regularly with at least 10 scheduled meetings per year. These meetings incorporate
an annual strategy day and scheduled presentations by leadership team members to provide the Board with
additional insight into their area of expertise. Additional meetings are held in person or via online audio and
web conferencing platforms, whichever provides the most efficient, timely, or safe solution at a given time.
Details of Directors’ attendance at scheduled Board and Committee meetings during the year can be found
on page 32 within the Director’s report.
QCA Principle 6: Ensure that between them, the Directors have the necessary up-to-date
experience, skills and capabilities
The Board is considered to have all appropriate skills, experience and knowledge sufficient to give it the
ability to constructively challenge strategy, decision making and scrutinise business performance.
The Board’s biographical details are set out on the Group’s website and within this Annual Report and
Accounts on pages 25 to 26.
Board composition remains under review to ensure it remains appropriate to the strategic and managerial
requirements of the Group. One third of the Directors are required, in accordance with the Company’s
Articles of Association, to retire annually in rotation. This enables the Shareholders to decide on the election
of the Company’s Board.
Attendance and participation in relevant training, networking and update events are encouraged in order to
create, maintain or enhance relevant skills and knowledge. Updates from the Quoted Companies Alliance
and external advisers are utilised to ensure relevant knowledge of Corporate Governance matters where
appropriate.
All Directors have access to the Group’s (or independent) professional advice at the Company’s expense.
In addition, they have access to the advice and services of the Company Secretary who is responsible to
the Board for advice on corporate governance matters.
QCA Principle 7: Evaluate Board performance based on clear and relevant objectives, seeking
continuous improvement
As part of his responsibilities with regards Board effectiveness and governance, the Chair, informally
assesses the performance of the Board and its Directors on an ongoing basis and brings to the relevant
party’s attention any areas for improvement.
The Board has committed to using the QCA Board effectiveness review to assess the 12 defined key areas
of Board effectiveness.
The Board is satisfied that its operating culture is open and dynamic enough not to warrant the use of Group
resources for an externally facilitated review at this time. This approach will be reviewed on an annual basis.
The effectiveness of the Board and its Committees are reviewed on at least an annual basis but kept under
review in accordance with Corporate Governance best practice.
QCA Principle 8: Promote a corporate culture that is based on ethical values and behaviours
As an SME, we recognise that it’s our people that will underpin delivery of our business model. We therefore
aim to create systems and roles that support the recruitment, retention, engagement and development of
our staff in response to ever-changing customer demands.
Autins operates its core Values that seek to establish a framework which all employees can support, will
govern our behaviours and underpin a high performance culture that the Board believes is required in order
29
to deliver our strategy.
Our aim is that the Group’s culture will be built on these Autins Values and they will inform the expected
behaviours that will be an integral part of our induction, appraisal and performance management and
leadership organisational
remuneration processes. We have already established a twice yearly
management review which allows for peer to peer review of critical business challenges, staff performance
and reward.
A positive health and safety culture is promoted within the business and the Group seek to reflect this in all
of our policies and procedures, as well as in our approach to the training and development of the people
involved in our operations. Health and Safety is the standing first agenda item at all Board and leadership
meetings. The Group’s Health and Safety Manager, who reports ultimately to the Chief Executive, has direct
access to the executive directors should he wish to raise any urgent concerns.
The Group’s policies and procedures are given to all new employees at induction, and are available to both
permanent and temporary staff via our employee engagement app. The app is also the Group’s portal for
anti-bribery, corruption and whistle-blowing policy. Any concerns raised are passed directly to the Chair of
the Audit Committee for independent review. All policies and procedures are subject to a periodic review
and re-approval to ensure they continue to meet their aims.
The Group’s share dealing code is applicable to all staff and available for review on the employment
engagement app. All staff are subject to a closed period from the last day of each full or half year until 48
hours after the results for that period have been published and require authorisation from the Company
Secretary for any trading activity outside of a close period.
QCA Principle 9: Maintain Governance structures and processes that are fit for purpose and
support good decision making by the Board
The Board maintains separate Audit, Nomination and Remuneration Committees whose purpose is to
consider and oversee issues of policy outside main Board meetings.
Audit Committee
The Audit Committee is comprised of the non-executive Directors and is chaired by Mark Taylor.
The Committee’s role is described within the Audit Committee Report set on pages 38 to 39.
Remuneration Committee
The Remuneration Committee comprises the three non-executive directors and is chaired by Andrew Burn.
The Committee is responsible, within its agreed terms of reference, for the following remuneration matters:
●
●
●
●
Setting and reviewing the remuneration policy for all executive directors and the senior leadership
team.
Confirm that remuneration payments made to directors and the senior leadership team are consistent
with approved policy.
Ensuring that remuneration payments are in accordance with appropriate benchmarks as well as
assessing changes in practice that may have future remuneration impacts.
Overseeing incentives-based remuneration for senior management or other employees identified as
relevant by the Committee.
In carrying out these duties the Committee shall ensure the appropriateness, relevance and market practice
in respect of such remuneration policy.
Nomination Committee
The Nomination Committee comprises the three non-executive directors and is chaired by Adam Attwood.
It has responsibility for reviewing the size, composition and structure of the Board (and its committees) and
making recommendations of any changes it believes are required for succession planning. The Committee
identifies and nominates for approval by the Board candidates to fill vacancies as and when they arise as
well as reviewing the results of any Board performance evaluations and proposing corrective actions if
required. The Committee, in conjunction with the Chief Executive, reviews annually the succession planning
strategy for the senior leadership team.
Whilst the Committee has ultimate responsibility for reviewing the structure, size and composition of the
Board and recommending any changes required, in practice the Board, as a whole, considers any
recommendations for appointments.
30
Interaction with the Board and governance
During the year, the Chair of each committee will provide the Board with a summary of key issues
considered, and conclusions drawn, at the committee meetings. Details regarding the frequency and
attendance of meetings for these committees are contained in the Director’s Report.
Written terms of reference have been established (and are regularly reviewed) for all Board committees.
These terms of reference are available on the Group’s Investor website and confirm the duties, authority,
reporting responsibilities and minimum meeting frequency for each committee.
Board committees are authorised, in the furtherance of their duties, to engage the services of external
advisers as they deem necessary at the Company’s expense.
QCA Principle 10: Communicate how the Group is governed and is performing by maintaining a
dialogue with shareholders and other relevant stakeholders
The Group communicates formally with shareholders via the Annual Report and Accounts, the full-year and
half-year results announcements and associated presentations, periodic market announcements and
trading updates (as appropriate) and the AGM.
The executive directors periodically meet with analysts and shareholders in face-to-face meetings as well
as hosting investor road shows and events both at the Group’s and investors’ premises.
The Group’s website has been designed to allow a more accessible platform to communicate the Group’s
strategy, products and processes to the wider community. A dedicated Investors section is maintained within
the main site and is updated regularly. The Investors’ website contains all financial reports and associated
Investor presentations since the Group’s Initial Public Offering, together with downloadable copies of
standing data (including the terms of reference of the Board’s subcommittees) that are of use to
stakeholders. We continue to use social media platforms primarily for companywide announcements and
to promote success stories.
This governance statement was last reviewed and approved on 1 March 2024.
31
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2023
The Directors present their report and the audited financial statements for the Group and the Company for
the year ended 30 September 2023.
In accordance with section 415 of the Companies Act 2006 particulars of important events affecting the
Group, together with the factors likely to affect its future development, performance and position are set out
in the strategic report on pages 3 to 23 which is incorporated into this report by reference.
The Directors’ statement on corporate governance is set out on pages 27 to 31. This report should be read
in conjunction with information concerning Directors’ Remuneration and employee share schemes in the
Remuneration report on pages 36 to 37 and which is incorporated by way of cross-reference into the
Directors’ Report.
The principal activities of the Group are the manufacture and sale of insulating materials primarily to the
automotive industry. The Company is an investment holding company. The Directors are not aware, at the
date of this report, of any likely changes in the Group’s activities in the next year.
Results and dividends
The results for the year are set out in the consolidated income statement and consolidated statement of
comprehensive income on pages 47 and 48. Following the year-end, the Directors assessed the
appropriateness of the Group declaring a final dividend and concluded that no dividend would be
appropriate.
Directors
The Directors who served during the year under review and up to the date of approving the Annual Report
and Accounts were:
●
●
●
●
(cid:2)
●
Adam Attwood;
Gareth Kaminski-Cook;
Neil MacDonald (resigned 30 June 2023);
Andrew Burn (appointed 15 May 2023);
Mark Taylor (appointed 13 November 2023);
Kamran Munir.
Corporate governance
The Directors’ statement regarding corporate governance can be found on pages 27 to 31. The Company
is a member of the Quoted Company Alliance (‘QCA’) and has adopted the QCA Corporate Governance
Code for Small and Mid-Size Quoted Companies (the implementation of corporate governance standards
through the year).
Board of Directors and Board committees
Biographical details of all the Directors at the date of this report are set out on pages 25 to 26.
The Board has formally delegated certain duties and responsibilities to the Audit, Remuneration and
Nomination Committees. These committees seek advice from the Company’s advisors as the need arises
and operated throughout the year. Their roles and membership are stated on pages 30 to 31 as part of the
corporate governance statement.
Meetings of the Board and its Committees
The following table sets out the number of meetings of the Board and Committees during the year under
review and individual attendance by the relevant members at these meetings:
Adam Attwood
Gareth Kaminski-Cook
Kamran Munir
Andrew Burn
(appointed 15 May 2023])
Neil MacDonald
(resigned 30 June 2023)
Board
Audit Committee
Number Attended
12
12
12
4
12
12
12
12
Number Attended
3
3
3
1
3
3
3
3
Remuneration
Committee
Number Attended
2
2
Nomination
Committee
Number Attended
1
1
12
9
3
3
2
2
1
1
32
Should a director be unable to attend a meeting, their comments on the business to be considered at the
meeting are discussed with the Chair ahead of the meeting so that their contribution can be included in the
wider Board discussion.
Auditor independence
The Audit Committee and the Group’s external auditor, Dains Audit Limited, have safeguards in place to
avoid the possibility that the auditor’s objectivity and independence could be compromised. These
safeguards include the auditor’s report to the Audit Committee on the actions they take to comply with the
professional and regulatory requirements and best practice designed to ensure their independence from the
Company.
The Group’s auditor, Dains Audit Limited did not undertake any non-audit work in the year.
Re-election of Directors
At every Annual General Meeting, one-third of the directors (excluding any director appointed since the
previous AGM) or, if their number is not a multiple of three, the number nearest to but not exceeding one-
third, shall retire from office by rotation.
Gareth Kaminski-Cook was re-elected at the AGM which took place in March 2023.
Directors’ interests and indemnity arrangements
At no time during the year did any director hold a material interest in any contract of significance with the
Company or any of its subsidiary undertakings excepting an indemnity provision between each Director and
the Company and employment contracts between each Executive Director and the Group. The Group has
purchased and maintained throughout the year Directors’ and Officers’ liability insurance in respect of all
Group companies.
Directors’ interests in shares
The beneficial interests in the shares of the Company of those Directors serving at 30 September 2022 are
noted in the Directors Remuneration report set on pages 36 to 37.
Share capital
Full details of the Company’s authorised and issued share capital are set out in note 20 to the consolidated
financial statements.
The Company has one class of ordinary share capital with a nominal value of £0.02 each. The rights and
obligations attached to the ordinary shares are governed by UK law and the Company’s Articles of
Association.
Major interests in shares
The following substantial interests (3% or more) in voting rights attaching to the Company’s ordinary shares
had been notified to the Company:
Shareholder
Schroder Investment Management
Stonehage Fleming Family & Partners
Braveheart Investment Group (UK)
Premier Miton Group (formerly Miton Group plc)
Ruffer LLP
Toscafund Asset Management (London)
Kevin Westwood
Karen Holdback
Killik Asset Management (London)
Financial risk management
Number of
voting rights
as at
30 September
2023
13.252.730
10,400,000
8,785,000
4,775,156
3,590,741
2,215,300
2,025,000
2,025,000
1,604,363
% voting
rights as at 30
September
2023
Number of
voting rights as
at
30 September
2022
% voting
rights as at
30 September
2022
24.27%
19.05%
16.09%
8.75%
6.58%
4.06%
3.71%
3.71%
2.94%
13,252,730
10,400,000
4,750,000
6,275,156
3,690,741
2,215,300
2,025,000
2,025,000
-
24.27%
19.05%
8.70%
11.49%
6.76%
4.06%
3.71%
3.71%
-
In certain circumstances, the Group uses financial instruments to manage specific types of financial risks,
including those relating to credit and foreign currency exchange. The Group’s objectives and policies on
financial risk management including information on liquidity, capital, credit and risk can be found on pages
63 to 66 of the financial statements.
33
Future business development
Our Strategy is to focus primarily on the automotive, commercial vehicle and flooring markets:
• Build broader and deeper relationships across auto and commercial OEM’s and Tiers, particularly in
Engineering, Purchasing, and technology partners.
• Create a more technical product offering, which has higher recycled content or is fully recyclable,
particularly leveraging our Neptune technology.
• Continue to bring new innovative products to flooring manufacturers.
• Create pull through demand and enquiries using a variety of marketing channels.
Research & Development
The Group has a Research and Product Development Strategy and a prioritised programme of projects
which is led jointly by the UK Commercial Director and the Group R&D Manager. The Board reviews the
programme twice a year and has a standing agenda item for each Board meeting to review key projects.
Strategic priority is given to environmental projects and maximising profit improvement. Notable in 2023
was the launch Neptune-R, a fully recyclable version of Neptune.
Health and safety
The Chief Executive, with support from a full time Environmental, Health and Safety professional, has overall
accountability for health and safety across the organisation.
The Group remains committed to providing a safe and healthy working environment for staff and contractors
alike. Groupwide health and safety standards and systems exist to set out, in support of a one company
approach, the required range of policies and procedures designed to manage risks and promote wellbeing
at all sites.
Management and the Board regularly review a range of health and safety performance measures and take
appropriate steps to address any areas for concern including ensuring lessons learned from incidents that
occur are shared across the Group for best practice improvements.
Since 2020 an increased level of attention has been given to knowledge and awareness around mental
health in the workplace, including home working. This included external training for the Group H&S Manager
and UK HR Manager.
Charitable and political donations in the year
The Company did not make any political or charitable donations during the year.
Going concern
Going concern is considered in note 1 to the financial statements.
Auditor
As recommended by the Audit Committee and pursuant to section 487 of the Companies Act 2006, the
Company will propose a resolution at the AGM to reappoint Dains Audit Limited as auditor and authorise
the Directors to agree their remuneration.
Audit information
The Directors who were in office on the date of approval of the Directors’ Report have confirmed that, so far
as they are aware, there is no relevant audit information of which the Company’s auditor is unaware. Each
of the directors has confirmed they have taken all the reasonable steps that he ought to have taken as a
director to make himself aware of any relevant audit information and to establish that the Company’s auditor
is aware of the information.
The confirmation is given and should be interpreted in accordance with the provisions of section 418 of the
Companies Act 2006.
Annual General Meeting
Details of the Company’s Annual General Meeting and the resolutions to be proposed are set out in the
separate Notice of Meeting.
The meeting will be held at 11am on 28 March 2024 at the Company’s main offices at Central Point One,
Central Park Drive, Rugby, Warwickshire, CV23 0WE.
34
The Directors’ Report has been approved by the Board of Directors on 1 March 2024.
By order of the Board.
Kamran Munir
Company Secretary
1 March 2024
Autins Group plc
Central Point One
Central Park Drive
Rugby
Warwickshire CV23 0WE
Company number: 08958960
35
DIRECTORS REMUNERATION REPORT
The remuneration of the executive directors and certain other key management team members is subject
to the approval and oversight of the Remuneration Committee which is chaired by Andrew Burn.
The Company’s remuneration policy is designed to promote the achievement of its strategic goals with
regard to growth and diversification and to attract and retain staff and directors capable of accelerating
achievement of the strategic plans.
In setting the measurement of executive performance, due notice is taken of the risk profile of the business
and to reward progress. The Committee believes that the Executive Directors and Leadership team should
be rewarded for securing long-term growth that provides for a sustained growth of investor returns.
Fixed pay is based on a market-based approach which takes into account the size of the Company, peer
review of compensation packages and the experience and qualifications of the executive in question.
Variable pay is designed to promote outperformance, which is achievable, repeatable and sustainable.
Directors
The Directors who served during the year under review and up to the date of approving the Annual Report
and Accounts are disclosed in the Directors’ Report.
At every Annual General Meeting, one-third of the Directors (excluding any Director appointed since the
previous AGM) or, if their number is not a multiple of three, the number nearest to but not exceeding one-
third, shall retire from office by rotation.
Directors’ interests – interests in shares
Adam Attwood
Gareth Kaminski-Cook
Kamran Munir
Neil MacDonald (resigned 30 June 2023)
Andrew Burn (appointed 15 May 2023)
2p ordinary
shares at 30
September 2023
% of issued
ordinary share
capital
2p ordinary
shares at
1 October 2022
% of issued
ordinary share
capital
675,000
245,228
45,000
200,000
1.24
0.45
0.08
0.37
675,000
245,228
45,000
200,000
1.24
0.45
0.08
0.37
Directors’ interests – interests in share options
Details of options that were held by Directors who were in office at 30 September 2023 are set out below.
These options lapsed on 30 September 2023 as the performance conditions had not been met. Company’s
option schemes are set out in more detail in notes 21 and 24 to the financial statements.
Kamran Munir
Gareth Kaminski-Cook
Date of Grant
Number Exercise
Price
Expiry Date
20 January 2021
1,064,189
£nil 1 October 2025
20 January 2021
1,459,459
£nil 1October 2025
The market price of the Company’s shares at 30 September 2023 was 12.5 pence. The range of market
prices during the year was 8.0 pence to 14.0 pence per share.
Contracts of service
The Executive Directors, Gareth Kaminski-Cook and Kamran Munir, each have a service agreement
containing one year’s and six months’ notice respectively, and claw back and malus clauses with regard to
any paid or unpaid bonuses.
The non-Executive Directors, Adam Attwood, Andrew Burn and Mark Taylor, have service agreements with
a three month notice period.
36
Salaries and benefits
The Remuneration Committee meets at least twice per year to consider, review and set the remuneration
packages for the Executive Directors.
Remuneration is benchmarked annually to ensure it remains comparable and competitive with companies
of a similar size and complexity. Remuneration for the executive directors comprises basic salary, pension
contributions and benefits in kind (including healthcare, company cars and life insurance). The non-
Executive Directors’ remuneration consists of basic salaries but they are also reimbursed for travel and
other out-of-pocket expenses. Remuneration for Executive Directors also includes share options as detailed
above.
Year ended 30 September 2023
G Kaminski-Cook
K Munir
A Attwood
N MacDonald (resigned 30 June 2023)
A Burn (appointed 15 May 2023)
Salary
£000
254
188
60
34
17
553
Benefits
£000
11
3
-
-
-
14
Pension
£000
-
17
-
-
-
17
Total
FY23
£000
265
208
60
34
17
585
Total
FY22
£000
284
218
60
45
0
608
Mark Taylor was appointed on 13 November 2023.
By order of the Board
Andrew Burn
Non- Executive Director and Chair of the Remuneration Committee
1 March 2024
37
AUDIT COMMITTEE REPORT
Members of the Audit Committee
The Committee currently consists of all serving non-executive directors. The Committee was chaired by Neil
MacDonald during the year and since 13 November 2023 is chaired by Mark Taylor.
The Board is satisfied that as Chair of the Committee in the period, Neil MacDonald had relevant and recent
financial experience as well as being a Chartered Accountant who has served as Finance Director and Chair
of Audit Committees in other organisations. The Board is also satisfied that as Chair of the Committee since
13 November 2023, Mark Taylor, had relevant and recent financial experience as well as being a Chartered
Accountant who has served as an audit partner and Chair of Audit Committee in another organisation.
Meetings of the Committee may, by invitation, be attended by the Chief Executive and the Chief Financial
Officer. The Committee met formally three times in the year. There were also several informal meetings with
the external auditors.
The Committee reports the outcome of its deliberations at the subsequent Board meeting and minutes of
each meeting are made available to all members of the Board.
Duties
The Audit Committee’s duties are set out in its terms of reference, which are available on the Company’s
website (www.autins.com/investors) and on request from the Company Secretary.
The normal items of business considered by the Audit Committee during the year included:
●
●
●
●
●
●
Review of the risk management and internal control framework;
Review of the financial statements, Annual Report and investor presentations;
Consideration of the external audit report and management representation letter;
Review of the interim results and associated presentation for investors;
Review of the FY23 audit plan and audit engagement letter; and
Meetings with the auditor with and without management present.
Role of the Auditor
The Audit Committee monitors the relationship with the auditor, Dains Audit Limited, to ensure that auditor
independence and objectivity is maintained.
The Committee monitors the provision of any non-audit services by the external auditor (if any). During the
year no non-audit services have been provided to the Company by the auditor.
The Audit Committee recommends Dains Audit Limited be reappointed as auditor at the next AGM.
Audit process
The auditor prepares and presents a plan for the audit of the full year financial statements that establishes
the scope, areas of special focus and audit timetable. This plan is reviewed and agreed by the Audit
Committee.
Following the audit of the annual financial statements the auditor presents its findings to the Audit Committee
for discussion. There were no major areas of concern highlighted by the auditor during the year beyond
those areas of significant risk and audit judgment that are routinely discussed and disclosed in their report
to the members of the Group.
Internal audit
The Committee considers that, taking account of the size and structure of the Group’s trading and assets,
an internal audit function is not required. The Committee will keep this under review to ensure that as the
Group develops and complexity increases appropriate resources are dedicated to the creation of an internal
audit function.
Risk management and internal controls
As described on page 28 of the Corporate Governance Report, the Group has established a framework of
risk management and internal control systems, policies and procedures. The Audit Committee is responsible
for reviewing the risk management and internal control framework and ensuring that it operates effectively.
During the year, the Committee has reviewed the framework and the Committee is satisfied that it is currently
operating effectively.
38
Whistleblowing
As noted in the Corporate Governance Report, the Group has a formal whistleblowing policy which sets out
the process for any employee of the Group to raise, in confidence, any concerns about possible
improprieties in financial reporting or other governance matters. The Chair of the Audit Committee acts as
the independent reviewer for any concerns that are raised, with any relevant matters and actions recorded
at the next appropriate meeting. During the year, there have been no incidents recorded or raised for
consideration.
By order of the Board
Mark Taylor
Non-Executive Director and Chair of the Audit Committee
1 March 2024
39
FINANCIAL STATEMENTS
Independent auditor’s report to the members of Autins Group Plc
Opinion
We have audited the financial statements of Autins Group Plc (the ‘Parent Company’) and its subsidiaries
(the ‘Group’) for the year ended 30 September 2023 which comprise the Consolidated Income Statement,
the Consolidated Statement of Comprehensive Income, the Consolidated and Parent Company Statements
of Financial Position, the Consolidated and Parent Company Statements of Changes in Equity, the
Consolidated Statement of Cash Flows and notes to the financial statements, including significant
accounting policies.
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 30
September 2023 and of the Group’s loss for the year then ended;
have been properly prepared in accordance with UK adopted International Accounting Standards
in conformity with the requirements of the Companies Act 2006; and
the parent company financial statements have been properly prepared in accordance with United
Kingdom Generally Accepted Accounting Practice, and
have been prepared in accordance with the requirements of the Companies Act 2006.
The financial reporting framework that has been applied in their preparation is applicable law and UK
adopted International Accounting Standards in conformity with the requirements of the Companies Act 2006.
The financial reporting framework that has been applied in the preparation of the Parent Company financial
statements is applicable law and United Kingdom Accounting Standards, including Financial Reporting
Standard 101 Reduced Disclosure Framework (United Kingdom Generally Accepted Accounting Practice).
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
responsibilities for the audit of the financial statements section of our report. We are independent of the
Group and the Parent 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, 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.
Our approach to the audit
As part of designing our audit approach, we obtained an understanding of the Group and its environment,
we determined materiality and assessed the risks of material misstatement in the financial statements. In
particular, we looked at where the Directors made subjective judgements, for example in respect of
significant accounting estimates that involved making assumptions and considering future events that are
inherently uncertain. As in all of our audits, we also addressed the risk of management override of internal
controls, including evaluating whether there was evidence of bias by the Directors that represented a risk of
material misstatement due to fraud.
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion
on the financial statements as a whole, taking into account the structure of the Group and the Parent
Company, the accounting processes and controls, and the industry in which they operate.
The Group financial statements are a consolidation of five reporting units, comprising the Group’s operating
businesses and holding companies.
In establishing the overall approach to the Group audit, we assessed the audit significance of each reporting
unit in the Group by reference to both its financial significance and other indicators of audit risk, such as the
complexity of operations and the degree of estimation and judgement in the financial results.
All of the Group’s three significant components (Autins Group Plc, Autins Limited and Autins GmbH) were
subjected to full scope audits for Group purposes by the Group engagement team. The remaining
40
components were not significant and so were subject to analytical review procedures and specified audit
procedures over certain account balances and transaction classes by the Group engagement team.
The significant components within the scope of our work accounted for 95% of group revenues and 92% of
total assets.
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) we identified, including 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.
Key audit matters
Impairment risks
The Group has goodwill, other
intangibles, property, plant and
equipment and right of use assets
of £15.5m. In accordance with
accounting standards, goodwill is
not amortised but is subject to an
annual impairment review through
assessment of the value in use of
the Automotive Noise, Vibration
and Harshness (“NVH”) CGU to
which
is attributable. The
existence of continuing operating
losses and the Group’s market
capitalisation being lower than the
consolidated net assets, provide
indicators that impairments may be
present.
it
In addition, property, plant and
equipment within the NVH CGU
includes the Neptune production
facility with a net book value of
£4.5m. This facility was completed
and brought into use in 2018 and
whilst
to
continue
is currently still
increase,
operating below full capacity.
volumes
it
Therefore we consider there to be a
significant risk in relation to the
achievement of the forecast future
trading and cash flows used to
determine
in use
the value
supporting the carrying value of the
goodwill, other intangible assets,
property, plant and equipment and
right of use assets in the NVH CGU
and the Neptune facility within the
NVH CGU.
No other CGU’s have any assets
which could be subject to material
impairment.
Details of the accounting policies,
and
significant
estimates
How our scope addressed this matter
We have tested the judgements made by management
in undertaking the impairment tests. This included:
(cid:2) The identification of the Cash Generating Units
(CGUs) and validating
the assumptions and
evidence supporting the allocation of the associated
revenue, costs and assets to CGUs;
(cid:2) Reconciling the information used in the value in use
models to the underlying accounting records and
the budgets and forecasts for the Group;
(cid:2) The recalculation of the discount rate used to
discount the cash flows in each CGU and changes
made to incorporate the risks in the business and
sector;
(cid:2) Comparing the forecasts to the information used to
assess
the going concern assumption and
challenging the robustness of the key assumptions,
including revenue and profit growth;
(cid:2) Considering the appropriateness of the sensitivities
applied by management. This included reviewing
the stress testing undertaken by management to
assess the appropriateness of the assumptions
applied for the relevant scenarios, assessing the
level of underperformance against management’s
forecasts required to eliminate the headroom for
both the NVH CGU and the Neptune facility and
considering
the
application of the relevant sensitivities; and
level of headroom after
the
(cid:2) Engaging our internal valuation experts, working
with them to confirm the appropriateness of the
models used by management to calculate the value
in use for each CGU, and the calculation of the
discount rates.
(cid:2) Reviewing
the disclosures prepared by
the
Directors set out in Notes 1, 2, 11, 12 and 13 to
ensure we consider them to be appropriate.
Key observations:
Nothing has come to our attention as a result of
performing the above procedures that causes us to
41
Key audit matters
judgements, property, plant and
equipment, right-of-use assets and
intangible assets are provided in
notes 1, 2, 11, 12 and 13.
Going concern
We have determined going concern
to be a key audit matter because of
challenging trading circumstances
and a further year of the Group
reporting a trading loss. These
matters, and the further uncertainty
created by the wider economy have
therefore increased the level of
estimation and judgement involved
to going concern
in
assessments and was a key area of
focus during our audit.
relation
the Directors’ going
Details of
concern assessment are disclosed
in note 1.
How our scope addressed this matter
believe that the assumptions and judgements used as
inputs
impairment considerations were
inappropriately applied.
the
in
We have tested the judgements made by management
in assessing the Group and the Parent Company’s
ability to continue to adopt the going concern basis of
accounting. This included:
(cid:2) Critically assessing management’s trading and
cash flow budgets and forecasts, which cover the
period to 30 September 2025. This included
challenging the key estimates and judgements and
the evidence underpinning them. In doing so, we
specifically considered the principal trading and
cash flow assumptions, the quantum of the banking
facilities used in the calculation of the available
liquidity and the impact of the confirmed lender
covenants position. Our challenge of the revenue
assumptions included consideration of customer
enquiries, current order levels and information from
customers regarding expected future volumes and
prices and included information available up to the
date of issuance of our report;
(cid:2) Testing the various scenarios and sensitivities
performed by management in respect of the key
assumptions underpinning
the budgets and
forecasts and challenged the sensitivities to ensure
they reflected all reasonably foreseeable events
and circumstances;
(cid:2) Reviewing the reverse stress-testing performed by
management and considering
the headroom
between the budgets and forecasts and the reverse
stress-test assumptions, together with considering
the
that unforeseen events and
circumstances might occur resulting in the reverse
stress test becoming a reality;
likelihood
(cid:2) Considering
the
information
to
management by their major customers relating to
future activity levels and the previous experience of
these activity levels being met; and
provided
(cid:2) Reviewing the disclosure prepared by the Directors
set out in Note 1 to ensure we consider it to be
appropriate.
Key observations:
As a result of performing the above procedures, we
have not identified any material uncertainties relating to
events of conditions that, individually or collectively,
may cast significant doubt on the Group’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.
42
Our application of materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative
thresholds for materiality. These, together with qualitative considerations, helped us to determine the scope
of our audit and the nature, timing and extent of our audit procedures on the individual financial statement
line items and disclosures and in evaluating the effect of misstatements, both individually and in aggregate
on the financial statements as a whole.
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect
of misstatements. We consider materiality to be the magnitude by which misstatements, including
omissions, could influence the economic decisions of reasonable users that are taken on the basis of the
financial statements.
In order to reduce to an appropriately low level the probability that any misstatements exceed materiality,
we use a lower materiality level, performance materiality, to determine the extent of testing needed.
Importantly, misstatements below these levels will not necessarily be evaluated as immaterial as we also
take account of the nature of identified misstatements, and the particular circumstances of their occurrence,
when evaluating their effect on the financial statements as a whole.
Based on our professional judgement, we determined materiality for the financial statements as a whole and
performance materiality as follows:
Materiality
Basis for
determining
materiality
Rationale for
the
benchmark
applied
Performance
materiality
Basis for
determining
performance
materiality
Group financial statements
Parent company financial
statements
2023
£’000
450
2% of Group
turnover
2022
£’000
375
2% of Group
turnover
2023
£’000
265
2.0% of net
assets
2022
£’000
300
2.0% of net assets
Revenue is the key
driver of the business
value and is the
underlying driver for
management’s key
measure of
performance.
385
Revenue is the key
driver of the business
value and is the
underlying driver for
management’s key
measure of
performance.
320
The Parent
Company does
not trade so the
key measure of
performance is
net assets.
The Parent
Company does not
trade so the key
measure of
performance is net
assets.
225
255
Set at 85% of
materiality after
having considered a
number of factors
including the
expected total value
of known and likely
misstatements and
the level of
transactions in the
year.
Set at 85% of
materiality after
having considered a
number of factors
including the
expected total value
of known and likely
misstatements and
the level of
transactions in the
year.
Set at 85% of
materiality after
having considered a
number of factors
including the
expected total value
of known and likely
misstatements and
the level of
transactions in the
year
Set at 85% of
materiality after
having
considered a
number of
factors
including the
expected total
value of known
and likely
misstatements
and the level of
transactions in
the year
Component materiality
We set materiality for each component of the Group which ranged from £225,000 to £265,000. In the audit
of each component, we further applied performance materiality levels of 85% of the component materiality
to our testing to ensure that the risk of errors exceeding component materiality was appropriately mitigated.
43
Reporting threshold
We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess
of £23,000 (2022 - £18,800). We also agreed to report differences below this threshold that, in our view,
warranted reporting on qualitative grounds.
Conclusions relating to going concern
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.
To evaluate the directors’ assessment of the Group’s ability to continue to adopt the going concern basis of
accounting, we completed the following audit procedures:
• Obtained an understanding of the relevant controls relating to the Group’s budgeting and forecasting
process;
• Challenged the key assumptions underpinning the Group’s forecasts; and
• Assessed the appropriateness of the Group’s disclosure concerning the adopting of the going
concern basis of account.
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 Group and the Parent
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.
Other information
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 course of 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 themselves. 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
In our opinion, based on the work undertaken in the course of the 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.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and the Parent Company and their 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 Parent Company, or returns adequate for
our audit have not been received from branches not visited by us; or
the Parent Company financial statements 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.
44
Responsibilities of Directors
As explained more fully in the statement of directors’ responsibilities, 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 Parent
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 Parent Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
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 gained an understanding of the legal and regulatory framework applicable to the Group and the industry
in which it operates and considered the risk of acts by the Group which were contrary to applicable laws
and regulations, including fraud. These included, but were not limited, to compliance with the Companies
Act 2006, the AIM listing rules and accounting standards.
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities,
including fraud and non-compliance with laws and regulations, was as follows:
•
the senior statutory auditor ensured that the engagement team collectively had the appropriate
competence, capabilities and skills to identify or recognise non-compliance with applicable laws and
regulations;
• we identified the laws and regulations applicable to the Group through discussions with directors
and other management, and from our commercial knowledge and experience of the manufacturing
sector;
• we focused on specific laws and regulations which we considered may have a direct material effect
on the financial statements or the operations of the Group, including the financial reporting
legislation, Companies Act 2006, the AIM listing rules, taxation legislation, anti-bribery, employment,
and environmental and health and safety legislation;
• we assessed the extent of compliance with the laws and regulations identified above through
•
making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team
remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the Group’s financial statements to material misstatement, including
obtaining an understanding of how fraud might occur, by:
• making enquiries of management as to where they considered there was susceptibility to fraud,
•
their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws
and regulations.
To address the risk of fraud through management bias and override of controls, we:
•
•
•
•
performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates set
out in Note 2 were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.
45
In response to the risk of irregularities and non-compliance with laws and regulations, we designed
procedures which included, but were not limited to:
•
•
•
•
agreeing financial statement disclosures to underlying supporting documentation;
reading the minutes of meetings of those charged with governance;
enquiring of management as to actual and potential litigation and claims; and
reviewing correspondence with HMRC, relevant regulators and the Group’s legal advisors.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including
those leading to a material misstatement in the financial statements or non-compliance with regulation. This
risk increases the more that compliance with a law or regulation is removed from the events and transactions
reflected in the financial statements, as we will be less likely to become aware of instances of non-
compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud
involves intentional concealment, forgery, collusion, omission or misrepresentation.
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.
Use of our report
This report is made solely to the Parent 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
Parent 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 Parent Company and the Parent Company’s members as a body, for our audit work,
for this report, or for the opinions we have formed.
Mark Hargate FCA (Senior Statutory Auditor)
For and on behalf of
Dains Audit Limited
Statutory Auditor
Chartered Accountants
Birmingham
United Kingdom
1 March 2024
46
Consolidated income statement
For the year ended 30 September 2023
Revenue
Cost of sales
Gross profit
Other operating income
Distribution expenses
Administrative expenses
Operating loss
Finance expense
Share of post-tax profit/(loss) of
equity accounted joint ventures
Profit on disposal of interest in joint venture
Loss before tax
Tax credit
Note
2023
£000
4
22,679
(15,997)
6,682
6
(562)
(6,872)
(746)
(501)
5
201
(1,041)
128
5
5
8
14
14
9
2022
£000
18,873
(14,638)
4,235
28
(501)
(6,746)
(2,984)
(542)
(26)
-
(3,552)
277
Loss after tax for the year
(913)
(3,275)
Earnings per share for loss attributable to
the owners of the parent during the year
Basic (pence)
Diluted (pence)
10
10
(1.67)p
(1.67)p
(6.34)p
(6.34)p
All amounts relate to continuing operations.
The notes on pages 55 to 80 form part of these financial statements.
47
Consolidated statement of comprehensive income
For the year ended 30 September 2023
Loss after tax for the year
Other comprehensive income
Items that may be reclassified
subsequently to profit or loss
Currency translation differences
2023
£000
2022
£000
(913)
(3,275)
(7)
(15)
Total comprehensive expense for the year
(920)
(3,290)
The notes on pages 55 to 80 form part of these financial statements.
48
Consolidated statement of financial position
As at 30 September 2023
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangible assets
Investments in equity-accounted
joint ventures
Total non-current assets
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Current liabilities
Trade and other payables
Loans and borrowings
Lease liabilities
Total current liabilities
Non-current liabilities
Trade and other payables
Loans and borrowings
Lease liabilities
Deferred tax liability
Total non-current liabilities
Total liabilities
Net assets
Equity attributable to equity
holders of the company
Share capital
Share premium account
Other reserves
Currency differences reserve
Profit and loss account
Total equity
11
12
13
14
15
16
17
18
12
17
18
12
19
20
22
22
22
22
2023
£000
8,407
4,302
2,839
-
2022
£000
8,949
4,549
2,987
74
15,548
16,559
2,343
4,275
2,090
8,708
2,669
3,433
1,786
7,888
24,256
24,447
4,468
1,306
889
6,663
99
2,387
4,280
12
6,778
13,441
10,815
1,092
18,366
1,886
(147)
(10,382)
3,358
860
825
5,043
105
2,907
4,627
30
7,669
12,712
11,735
1,092
18,366
1,886
(140)
(9,469)
10,815
11,735
The notes on pages 55 to 80 form part of these financial statements.
The financial statements were approved and authorised for issue by the Board and were signed on its
behalf on 1 March 2024
Kamran Munir
Group Chief Financial Officer
Autins Group plc
Registered number: 08958960
49
Parent company statement of financial position
As at 30 September 2023
Non-current assets
Property, plant and equipment
Intangible assets
Investments
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Current liabilities
Trade and other payables
Loans and borrowings
Total current liabilities
Non-current liabilities
Loans and borrowings
Total non-current liabilities
Total liabilities
Net assets
Equity attributable to equity
holders of the company
Share capital
Share premium account
Other reserves
Profit and loss account
Total equity
Note
11
13
14
16
17
18
18
20
22
22
22
2023
£000
2022
£000
-
56
16,239
16,295
9,008
247
9,255
1
56
16,239
16,296
10,911
244
11,155
25,550
27,451
8,458
1,195
9,653
2,042
2,042
11,695
13,855
1,092
18,366
1,886
(7,489)
13,855
8,990
739
9,729
2,628
2,628
12,357
15,094
1,092
18,366
1,886
(6,250)
15,094
The Company has elected to take the exemption under section 408 of the Companies Act not to present the
parent Company profit and loss account. The loss for the parent Company for the year was £1,239,000
(2022: loss of £1,709,000).
The notes on pages 55 to 80 form part of these financial statements.
The financial statements were approved and authorised for issue by the Board and were signed on its behalf
on 1 March 2024.
Kamran Munir
Group Chief Financial Officer
Autins Group plc
Registered number: 08958960
50
Consolidated statement of changes in equity
For the year ended 30 September 2023
Share
capital
£000
Share
premium
account
£000
Currency
Other
reserves
£000
differences
reserve
£000
At 30 September 2022
1,092
18,366
1,886
(140)
Profit and
loss
account
£000
(9,469)
Total
Equity
£000
11,735
Comprehensive income
for the year
Loss for the year
Other comprehensive
income
Total comprehensive
expense for the year
-
-
-
-
-
-
-
-
-
-
(7)
(7)
(913)
-
(913)
(913)
(7)
(920)
At 30 September 2023
1,092
18,366
1,866
(147)
(10,382)
10,815)
Consolidated statement of changes in equity
For the year ended 30 September 2022
Share
capital
£000
Share
premium
account
£000
Currency
Other
reserves
£000
differences
reserve
£000
At 30 September 2021
792
15,866
1,866
(125)
Profit and
loss
account
£000
(6,194)
Total
Equity
£000
12,225
Comprehensive income
for the year
Loss for the year
Other comprehensive
income
Total comprehensive
expense for the year
Contributions by owners
Shares issued in the year
(net of expenses)
-
-
-
-
-
-
300
2,500
-
-
-
-
-
(15)
(15)
(3,275)
(3,275)
-
(15)
(3,275)
(3,290)
-
-
2,800
At 30 September 2022
1,092
18,366
1,866
(140)
(9,469)
11,735
51
Parent company statement of changes in equity
For the year ended 30 September 2023
Share
capital
£000
Share
premium
account
£000
Other
reserves
£000
At 30 September 2022
1,092
18,366
1,886
Profit and
loss
account
£000
(6,250)
Total
Equity
£000
15,094
Comprehensive income for the year
Loss for the year and total comprehensive
expense
Total comprehensive expense for the
year
-
-
-
-
-
-
(1,239)
(1,239)
(1,239)
(1,239)
At 30 September 2023
1,092
18,366
1,886
(7,489)
13,855
792
15,866
1,886
(4,541)
14,003
At 30 September 2021
Comprehensive income for the year
Loss for the year and total comprehensive
expense
Total comprehensive expense for the
year
-
-
-
-
Contributions by owners
Shares issued in the year (net of expenses)
300
2,500
-
-
-
(1,709)
(1,709)
(1,709)
(1,709)
-
2,800
At 30 September 2022
1,092
18,366
1,866
(6,250)
15,094
52
Consolidated statement of cash flows
For the year ended 30 September 2023
Operating activities
Loss after tax
Adjustments for:
Income tax
Finance expense
Depreciation of property, plant and equipment
Depreciation of right-of-use assets
Amortisation of intangible assets
Profit on disposal of interest in joint venture
Share of post-tax profit of equity accounted joint ventures
(Increase)/decrease in trade and other receivables
Decrease/(increase) in inventories
Increase in trade and other payables
Cash generated from/(used in) operations
Income taxes received
Net cash flows from/(used in) operating activities
Investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Proceeds from disposal of tangible fixed assets
Proceeds from disposal of interest in joint venture
Dividend received from equity-accounted for joint venture
Net cash used in investing activities
Financing activities
Interest paid
Proceeds from issue of shares
Share issue expenses paid
Loan issue expenses paid
Bank loans repaid
Principal paid on lease liabilities
Hire purchase finance advanced
Hire purchase agreements repaid
2023
£000
(913)
(128)
501
895
817
199
(201)
(5)
1,165
(723)
291
1,274
842
2,007
67
2,074
(531)
(82)
118
180
-
(315)
(501)
-
-
-
(179)
(851)
205
(110)
Net cash (used in)/generated from financing activities
(1,436)
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Foreign exchange movements
Cash and cash equivalents at end of year
Cash and cash equivalents comprise:
Cash balances
323
1,786
(19)
2,090
2023
£000
2,090
2022
£000
(3,275)
(277)
542
884
831
163
-
26
(1,106)
261
(236)
255
280
(826)
291
(535)
(219)
(112)
-
-
20
(311)
(527)
3,000
(200)
(3)
(108)
(688)
-
(87)
1,387
541
1,238
7
1,786
2022
£000
1,786
53
Reconciliation of movements in net cash/financing liabilities
Year ended 30 September 2023
Cash and cash equivalents
Cash balances
Financing liabilities
Bank loans
Hire purchase liabilities
Lease liabilities
Year ended 30 September 2022
Cash and cash equivalents
Cash balances
Bank overdrafts
Financing liabilities
Bank loans
Hire purchase liabilities
Lease liabilities
Opening
£000
Cash flows
£000
Non-cash
movements
£000
Closing
£000
1,786
323
(19)
2,090
(3,625)
(142)
(5,452)
(9,219)
(7,433)
179
(95)
1,116
1,200
1,523
(10)
-
(833)
(843)
(862)
Opening
£000
Cash flows
£000
Non-cash
movements
£000
1,262
(24)
1,238
(3,714)
(229)
(5,636)
(9,579)
(8,341)
517
24
541
103
87
987
1,177
1,718
7
-
7
(14)
-
(803)
(817)
(810)
(3,456)
(237)
(5,169)
(8,862)
(6,772)
Closing
£000
1,786
-
1,786
(3,625)
(142)
(5,452)
(9,219)
(7,433)
Material non cash transactions
Financing liabilities include lease liabilities, primarily in respect of property leases, following the adoption of
IFRS 16 from 1 October 2019. Additions of £610,000 net of foreign exchange movements of £42,000 are
shown in non-cash movements together with financing charges of £265,000 (FY22: £534,000 of additions
net of foreign exchange movements of £30,000 together with financing charges of £299,000).
54
Notes to the financial statements
1. Accounting policies
Description of business
Autins Group is a public limited company (Plc) registered and domiciled in England and Wales and listed on
AIM, a market operated by the London Stock Exchange. The principal activity of the Group is the supply of
Noise Vibration and Harshness (NVH) insulating materials. Supply is primarily to the automotive industry
but, more recently, the Group has diversified supply into other industries such as commercial vehicles,
flooring, office pods and building applications. The address of the registered office is Central Point One,
Central Park Drive, Rugby, Warwickshire, CV23 0WE.
Accounting convention and basis of preparation
The financial statements have been prepared in accordance with the historical cost convention and
International Accounting Standards in conformity with the requirements of the Companies Act 2006. The
stated accounting policies have been consistently applied to all periods presented.
The parent company financial statements have been prepared under applicable United Kingdom
Accounting Standards (FRS101) in order to apply International Accounting Standards in conformity with
the requirements of the Companies Act 2006. The following FRS 101 disclosure exemptions have been
taken in respect of the parent company only information:
(cid:2)
(cid:2)
(cid:2)
IAS 7 Statement of cash flows;
IFRS 7 Financial instruments disclosures and;
IAS 24 Key management remuneration.
The consolidated financial statements are drawn up in sterling, the functional currency of Autins Group plc.
The level of rounding for the financial statements is the nearest thousand pounds.
Going concern
The Directors have concluded that, based on current and forecast trading, the annual cash flow forecasts,
and the available sources of finance, that it is appropriate to prepare these financial statements on the going
concern basis.
The Directors have prepared trading and cash flow forecasts through to 30 September 2025. The forecasts
incorporate the actual trading and cash flow performance through to 31 January 2024, which show an
improved position compared to the same period in the prior year.
The trading forecasts take into consideration:
(cid:2)
(cid:2)
(cid:2)
the current and expected demand schedules from the Group’s key automotive customers, changes
in expected demand for flooring products in Germany and the levels of enquiries for new business;
the impact of current and future expected demand levels for new vehicles, the migration to EV’s
and publicly available forward looking market information on market sizes and dynamics; and
the current cost structure of the Group and an allowance for known increases, for example in
relation to increases in the minimum wage from April 2024, and various projects to improve
efficiency in the production and procurement processes.
The key sensitivities in the trading forecasts are automotive revenue levels, end market vehicle sales mix
and the timing of orders placed by customers. These sensitivities have been factored into the forecasts.
The cash flow forecasts are derived from the trading forecasts and include the repayment of loans in
accordance with the agreements with the lenders, further details of which are provided below. The cash flow
forecasts also assume that working capital is managed in line with the commercial agreements and provide
a contingency.
The facilities available to the Group comprise a UK invoice finance facility of up to £3.5 million and combined
overdraft facilities in Germany and Sweden of £0.2 million, none of which are currently drawn. As at 26
February 2024, shortly before the reporting date, the cash headroom, including the undrawn facilities is £3.7
million (30 September 2023: £4.1 million). The minimum cash headroom, comprising cash at bank and
available facilities, in the forecasts for a period of 12 months from the date of signing these financial
statements is £1.0 million in March 2025, following the full repayment of the MEIF term loan.
As at 30 September 2023, the Group had:
(cid:2) a UK CBILS loan of £1.7 million;
(cid:2) a MEIF loan of £1.5 million; and
(cid:2) a German Government loan of £0.2 million.
55
The UK CBILS loan is repayable in quarterly instalments of £146,154 through to 2026. A revised facility
agreement was signed in relation to this loan on 29February 2024 which included covenants in relation to
minimum EBITDA levels, minimum levels of cash at bank plus available facilities (liquidity) and maximum
net leverage (total debt, excluding IFRS 16 liabilities, as a multiple of EBITDA), which are measured
quarterly and minimum debt service (EBITDA as a multiple of debt service costs, excluding the IFRS 16
debt service cost and the MEIF term loan repayment), which is measured annually. The forecasts
demonstrate that in the period of 12 months from signing these financial statements the covenants are fully
complied with.
A revised facility agreement was also signed on 29 February 2024 in relation to the MEIF loan, which
schedules full repayment of the loan by 31 December 2024. This facility does not include any covenants.
The German Government loan is repayable in quarterly instalments of £8,000 through to 2030.
Composition of the Group
A list of the subsidiary undertakings is given in note 14 to the financial statements.
Changes in accounting policies
These financial statements have been prepared in accordance with International Accounting Standards in
conformity with the requirements of the Companies Act 2006 for periods beginning on or after 1 October
2022 with no new standards adopted in these financial statements
New accounting standards applicable to future periods
There are no new standards, interpretations and amendments which are not yet effective in these financial
statements, expected to have a material effect on the Group’s future financial statements. After Brexit, the
UK continues to apply International Accounting Standards in conformity with the requirements of the
Companies Act 2006.
Basis of consolidation
The consolidated financial statements incorporate the results of business combinations using the
acquisition method. In the statement of financial position, the acquiree's identifiable assets (both tangible
and intangible), liabilities and contingent liabilities are initially recognised at their fair values at the
acquisition date.
The consolidated financial statements present the results of the Company and its subsidiaries ("the Group")
as if they formed a single entity. Intercompany transactions and balances between Group companies are
therefore eliminated in full.
Subsidiaries are all entities over which the Group has control. The Group controls an entity when it is
exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect
those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which
control is transferred to the Group and cease to be consolidated from the date on which control is
transferred out of the Group. Any non-controlling interest in a subsidiary entity is recognised at a
proportionate share of the subsidiary’s net assets or liabilities. On acquisition of a non-controlling interest,
the difference between the consideration paid and the non-controlling interest at that date is taken to equity
reserves.
Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable when performance
obligations are satisfied and represents the amount receivable for goods supplied, net of returns, discounts
and rebates allowed by the Group and value added taxes.
Revenue from the sale of goods is recognised when the customer has taken control of the goods and is
able to benefit from or direct the use of the goods, which is usually when the goods have been accepted
by the customer.
The Group recognises revenue from the sale of tooling when the obligation for it to be capable of the
specified production use are satisfied which is considered to be when the specific tool has passed pre-
production assessment and sign off by the relevant customer engineer.
Where the costs of developing a specific automotive tooling component for a customer do not result in a
product that will enter volume production, the revenue arising from cost recovery for obsolete materials,
tooling and design and development work is recognised at the point of customer acceptance of the claim.
Expenditure
Expenditure is recognised in respect of goods and services received when supplied in accordance with
contractual terms. Provision is made when a present obligation exists for a future liability relating to a past
56
event and where the amount of the obligation can be reliably estimated.
Goodwill
Goodwill arising on acquisitions is the excess of the fair value of the cost of acquisition, over the fair value
of identifiable net assets acquired. Any direct costs are expensed in the income statement. Goodwill on
acquisition is recorded as an intangible fixed asset and represents the residual amount remaining after
taking account of the fair values attributed to the identifiable assets, liabilities and contingent liabilities that
existed at the date of acquisition, reflecting their condition at that date. Adjustments are also made to align
the accounting policies of acquired businesses with those of the Group. This is applied either on initial
acquisition or where control is gained over a previously equity accounted interest in an entity. A fair value
is measured for the entire holding on taking control and in respect of all assets and liabilities resulting in a
gain or loss on a previously held and equity accounted investment.
Goodwill is assigned an indefinite useful economic life. Impairment reviews are performed annually, or
more frequently if events or changes in circumstances indicate that the carrying value may not be
recoverable.
Impairment of non-financial assets
Impairment tests on goodwill are undertaken annually at the financial year end. All other individual non-
financial assets or cash-generating units are tested for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the carrying value exceeds the recoverable
amount of the asset or cash-generating unit. The recoverable amount is the higher of fair value, reflecting
market conditions less costs to sell, and value in use based on an internal discounted cash flow evaluation.
Impairment charges are included in profit or loss, except to the extent they reverse gains previously
recognised in other comprehensive income. An impairment loss recognised for goodwill is not reversed.
Intangible assets acquired as part of a business combination
Intangible assets acquired in a business combination are identified and recognised separately from
goodwill where they are separable from the acquired entity or give rise to other contractual/legal rights.
Amounts assigned to intangibles acquired as part of a business combination are arrived at by using an
appropriate valuation technique for the asset concerned.
All intangible assets acquired through a business combination are amortised on a straight-line basis over
their estimated useful lives. Amortisation is reported within administrative expenses in the consolidated
statement of comprehensive income.
The intangibles currently recognised by the Group; their useful economic lives and the methods used to
determine the separable cost of the intangibles acquired in business combinations are as follows:
Intangible asset
Tooling intellectual property
Useful economic life
10 years
Valuation method
Estimated discounted cash flow
of post-tax royalty earnings
potential
Estimated discounted cash flow
Key customer relationships
7 years
Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost
less accumulated amortisation and impairment losses.
Property, plant and equipment
Items of property, plant and equipment are initially recognised at cost. As well as the purchase price, cost
includes directly attributable costs, pre-production plant commissioning costs and interest incurred during
the course of construction.
Depreciation is provided on all items of property, plant and equipment so as to write off their cost, less
expected residual value over the expected useful economic lives. It is provided at the following rates:
Plant and machinery
Leasehold improvements
Fixtures and fittings
-
-
-
5-20 years straight line or units of production (see below)
Period of the lease
3-15 years straight line
Depreciation of the Group’s Neptune material production line has been provided based on a fixed unit of
production method since the commencement of commercial production.
The unit of production has been calculated based on the original equipment manufacturer’s warranted
57
minimum annual capacity, adjusted for management’s recent experience, and management’s assessment
of expected life. Any re-assessment of this lifetime capacity will affect the depreciation rate prospectively.
Right-of-use assets
Assets and liabilities arising from a lease are initially measured at the present value of the lease payments
and payments to be made under reasonably certain extension options are also included in the
measurement of the liability. The lease payments are discounted using the interest rate implicit in the lease
or the incremental borrowing rate that the individual lessee would have to pay to borrow the funds
necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment
with similar terms, security and conditions.
Lease payments are allocated between principal, presented as a separate category within liabilities, and
finance cost. The finance cost is charged to the statement of comprehensive income over the lease period
so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
Right-of-use assets are measured at cost comprising the amount of the initial measurement of lease
liability, any lease payments made at or before the commencement date less any lease incentives received
and any initial direct costs. Depreciation is charged on a straight line basis over the period of the lease and
assets are subject to impairment reviews where circumstances indicate their value may not be recoverable
or if they are not being utilised.
Profit/loss on disposal of property, plant and equipment and intangible assets
Profits and losses on the disposal of property, plant and equipment and intangible assets represent the
difference between the net proceeds and net book value at the date of sale. Disposals are accounted for
when the relevant transaction becomes unconditional.
Inventories
Inventories are initially recognised at cost, and subsequently at the lower of cost and net realisable value.
Cost comprises all costs of purchase, costs of conversion and an appropriate proportion of fixed and
variable overheads incurred in bringing the inventories to their present location and condition. Net
realisable value being the estimated selling price less costs to complete and sell. Where necessary,
provision is made to reduce cost to no more than net realisable value having regard to the nature and
condition of inventory, as well as its anticipated utilisation and saleability.
Tooling for resale - contract assets
Where a customer project or component is secured, the Group may be required to source and test
production tooling in advance of volume production. Tooling sourced for a customer is recognised at cost
and held as a contract asset in receivables when the Group has a documented commitment from the
customer and is valued at the lower of cost and net realisable value. The cost is expensed when the
revenue is recognised and where the Group has no customer commitment to meet the costs of tooling
production. The costs are expensed within cost of sales as incurred.
Research and development
An internally generated intangible asset arising from development (or the development phase) of an
internal project is recognised if, and only if, all of the following have been demonstrated:
(cid:2)
It is technically feasible to complete the development such that it will be available for use, sale or
licence;
(cid:2) There is an intention to complete the development;
(cid:2) The method by which probable future economic benefits will be generated is known;
(cid:2) There are adequate technical, financial and other resources required to complete the development
and;
(cid:2) There are reliable measures that can identify the expenditure directly attributable to the project
during its development.
The amount recognised is the expenditure incurred from the date when the project first meets the
recognition criteria listed above. Expenses capitalised consist of employee costs incurred on development
and an apportionment of appropriate overheads.
Where the above criteria are not met, development expenditure is charged to the consolidated income
statement in the period in which it is incurred. The expected life of internally generated intangible assets
varies based on the anticipated useful life, currently ranging from five to ten years.
Subsequent to initial recognition, internally generated intangible assets are reported at cost less
accumulated amortisation and impairment losses.
Amortisation is charged on a straight-line basis over the estimated period in which the intangible asset has
economic benefit from the commencement of related product sales and is reported within administrative
58
expenses in the consolidated statement of comprehensive income.
Research expenditure is recognised as an expense in the period in which it is incurred.
Revenue based grants
Revenue based grants, including those related to government coronavirus job and business support
schemes, are recognised as income based on the specific terms related to them as follows:
(cid:2) A grant is recognised in other operating income when the grant proceeds are received (or receivable)
(cid:2)
provided that the terms of the grant do not impose future performance-related conditions.
If the terms of a grant do impose performance-related conditions then the grant is only recognised
in income when the performance-related conditions are met.
(cid:2) Any grants that are received before the revenue recognition criteria are met are recognised in the
statement of financial position as another creditor within liabilities.
Capital grants
Grants received relating to property, plant and equipment are treated as deferred income and released to
the income statement over the expected useful lives of the assets concerned.
Foreign currencies
Transactions entered into by Group entities in a currency other than the currency of the primary economic
environment in which they operate (their ‘functional currency’) are recorded at the rates ruling when the
transactions occur. Foreign currency monetary assets and liabilities are translated at the rates ruling at the
reporting date. Exchange differences arising on the retranslation of unsettled monetary assets and
liabilities are recognised immediately in the consolidated income statement.
Translation of the results of overseas businesses
The results of overseas subsidiaries and joint ventures are translated into the Group’s presentational
currency of sterling each month at the weighted average exchange rate for the month. The weighted
average exchange rate is used, as it is considered to approximate the actual exchange rates on the date
of the transactions. The assets and liabilities of such undertakings are translated at the year-end exchange
rate. Exchange differences arising on translating the opening net assets at opening rate and the results of
overseas operations at actual rate are recognised in other comprehensive income and accumulated in a
separate equity reserve.
Hire purchase liabilities
Hire purchase agreements where the Group has substantially all the risks and rewards of ownership and
retains the asset at the end of the payment term are classified as hire purchase liabilities within loans and
borrowings. Assets are capitalised at the agreement’s commencement at the lower of the fair value of the
related asset and the present value of the minimum lease payments.
Each payment is allocated between the liability and finance charges. The remaining future rental
obligations, net of finance charges, are included in hire purchase obligations in current or non-current
liabilities. The finance cost is charged to the income statement over the lease period so as to produce a
constant periodic rate of interest on the remaining balance of the liability for each period. The property,
plant and equipment acquired under hire purchase contracts is depreciated over the useful life of the asset.
Borrowing costs
Borrowings are recognised initially at fair value, net of transaction costs incurred. They are subsequently
carried at amortised cost and the difference between the proceeds (net of transaction costs) and the total
redemption value is recognised in the income statement over the period of the borrowings using the
effective interest method.
Operating leases
From 1 October 2019 IFRS 16 was applied with additional right-of-use-assets and related liabilities
recognised as set out in the policy above. Payments associated with short-term leases of property, plant
and equipment and leases of low-value assets continue to be recognised on a straight-line basis as an
expense. Short-term leases are leases with a lease term of 12 months or less.
Employee benefit costs
The Group operates a defined contribution pension scheme. Contributions payable to the pension scheme
are charged to the consolidated statement of comprehensive income in the period to which they relate.
Share based payment
The Group operates an equity-settled share based compensation plan in which the Group receives
services from directors and certain employees as consideration for share options. The fair value of the
59
services is recognised as an expense, determined by reference to the fair value of the options granted.
Invoice discounting
The Group has an agreement with HSBC whereby its trade receivables are discounted, with recourse after
120 days. On the basis that the benefits and risks attaching to the debts remained with the Group, the
gross debts are included as an asset within trade receivables (net of any provisions and discounts) and
the proceeds received are included within current liabilities as short-term borrowings under invoice
discounting facilities. The net cash advances or repayments are presented as financing cash flows.
Charges and interest are recognised in the finance expense in the consolidated statement of
comprehensive income as they accrue.
Investments in subsidiaries
Investments in subsidiaries are stated at cost or at the fair value of shares issued as consideration less
provision for any impairment.
Investments in joint ventures
A joint venture is an arrangement in which the Group has joint control, whereby the Group has rights to
the net assets of the arrangement, rather than rights to its assets and obligations for its liabilities. Joint
control is the contractually agreed sharing of control of an arrangement, which exists only when decisions
about the relevant activities require unanimous consent of the parties sharing control.
The Group accounts for its interests in joint ventures using the equity method. Under the equity method,
an investment in a joint venture is initially recognised in the consolidated statement of financial position at
cost and adjusted thereafter to recognise the Group’s share of the profit or loss and other comprehensive
income of the joint venture.
When the Group’s share of losses of a joint venture exceeds the Group’s interest in that joint venture
(which includes any long-term interests that, in substance, form part of the Group’s net investment in the
joint venture), the Group discontinues recognising its share of further losses, unless and only to the extent
that the Group has incurred legal or constructive obligations or made payments on behalf of the joint
venture for those losses.
Any premium paid for an investment in a joint venture above the fair value of the Group's share of the
identifiable assets, liabilities and contingent liabilities acquired is capitalised and included in the carrying
amount of the investment in the joint venture. Where there is objective evidence that the investment in a
joint venture has been impaired the carrying amount of the investment is tested for impairment in the same
way as other non-financial assets.
Financial assets
The Group classifies its financial assets based upon the purpose for which the asset was acquired. The
Group has not classified any of its financial assets as held at fair value through profit and loss or through
other comprehensive income.
The classes of financial assets are commented upon further below:
(a) Receivables
These assets are non-derivative financial assets with fixed or determinable payments that are not quoted
in an active market. They arise principally through the provision of goods to customers (e.g. trade
receivables and contract balances). They are initially recognised at fair value plus transaction costs that
are directly attributable to their acquisition or issue and are subsequently carried at amortised cost using
the effective interest method.
The Group’s receivables comprise trade and other receivables included within the consolidated statement
of financial position.
The Group applies the simplified IFRS 9 approach and recognises loss allowances for expected credit
losses (ECLs) on financial assets measured at amortised cost to the extent that these are experienced
and significant for assets subject to similar credit risks and ageing. The group measures loss allowances
for trade receivables and contract assets at an amount equal to lifetime ECL and the expected loss rates
are based on a three year period adjusted where required for current and forward looking information on
the group’s customers. The potential default of receivables from other group companies is measured using
a 12 month ECL and assessment for any significant changes in risk related to changes in underlying trading
or prospects. The gross carrying amount of a financial asset is written off (either partially or in full) against
the allowance to the extent that there is no realistic prospect of recovery.
60
(b) Cash and cash equivalents
Cash and cash equivalents comprise cash held at bank which is available on demand.
Financial liabilities
The Group classifies its financial liabilities as other financial liabilities and does not enter into any financial
liabilities which are held at fair value through profit or loss or through other comprehensive income. This
reflects the purpose for which the liabilities were acquired.
Other financial liabilities comprise:
(cid:2) Trade payables, amounts owed to equity accounted joint ventures, accruals and other payables
are initially recognised at fair value, and subsequently carried at amortised cost using the
effective interest method.
(cid:2) Bank loans, bank overdrafts, invoice discounting, lease liabilities and hire purchase agreements
are initially recognised at fair value net of any transaction costs directly attributable to the issue
of the instrument. Such interest bearing liabilities are subsequently measured at amortised
cost ensuring the interest (effective rate) element of the borrowing is expensed over the
repayment period at a constant rate.
Share capital
Financial instruments issued by the Group are treated as equity only to the extent that they do not meet
the definition of a financial liability. The Group’s ordinary shares are classified as equity instruments.
Dividends
Dividend distributions to the Group’s shareholders are recognised as a liability in the period in which the
dividend becomes a committed obligation.
Final dividends are recognised when they are approved by the shareholders. Interim dividends are
recognised when paid.
Taxation
Current taxes are based on the results and are calculated according to local tax rules, using tax rates
enacted or substantively enacted by the date of the statement of financial position.
Deferred taxation
Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the
consolidated statement of financial position differs from its tax base, except for differences arising on:
(cid:2)
(cid:2)
(cid:2)
the initial recognition of goodwill;
the initial recognition of an asset or liability in a transaction which is not a business combination and
at the time of the transaction affects neither accounting or taxable profit; and
investments in subsidiaries and jointly controlled entities where the Group is able to control the
timing of the reversal of the difference and it is probable that the difference will not reverse in the
foreseeable future.
Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit
will be available against which the difference can be utilised.
The amount of the asset or liability is determined using tax rates that have been enacted or substantively
enacted by the date of the statement of financial position and are expected to apply when the deferred tax
liabilities or assets are settled or recovered. Deferred tax balances are not discounted.
Deferred tax assets and liabilities are offset when the Group has a legally enforceable right to offset current
tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax
authority on either:
(cid:2)
(cid:2)
the same taxable Group company; or
different entities which intend either to settle current tax assets and liabilities on a net basis, or
to realise the assets and settle the liabilities simultaneously, in each future period in which
significant amounts of deferred tax assets and liabilities are expected to be settled or recovered.
61
Operating segments
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision-maker. The chief operating decision maker has been identified as the management
team including the Chief Executive Officer, Chief Financial Officer and Chair.
The Board considers that the Group’s activity constitutes one primary operating and one separable
reporting segment as defined under IFRS 8. Management considers the reportable segment to be
Automotive Noise, Vibration and Harshness (NVH). Revenue and profit before tax primarily arises from
the principal activity based in the UK. Management reviews the performance of the Group by reference to
total results against budget.
The total profit measure is operating profit as disclosed on the face of the consolidated income statement.
No differences exist between the basis of preparation of the performance measures used by management
and the figures in the Group financial statements.
2. Critical accounting estimates and judgements
The Group makes certain estimates and assumptions regarding the future. Estimates and judgements are
continually evaluated based on historical experience and other factors, including the expectations of future
events that are believed to be reasonable under the circumstances and any further evidence that arises
relevant to judgements taken. In the future, actual experience may differ from these estimates and
assumptions. The estimates and judgements that have a significant risk of causing a material adjustment
to the carrying amounts of assets and liabilities within the next financial year are discussed below.
Property, plant and equipment and right-of-use assets (Notes 11 and 12)
Judgement
Depreciation commences once an asset is considered to be capable of operating in the manner intended
and to the specification set by management when ordering the equipment. Judgement is applied based on
testing of the equipment and trial products which impacts the commencement and charge in a period.
Depreciation on right-of-use property assets commences from the start of the lease.
Estimates
Property, plant and equipment are depreciated over the estimated useful lives of the assets. Useful lives
are based on management’s estimates of the period that the assets will generate revenue, which are
reviewed annually for continued appropriateness and events which may cause the estimate to be revised.
The key areas of estimation uncertainty regarding depreciation is the use of the unit of production method
for the Neptune assets and the determination of the lifetime capacity; risk of obsolescence from
technological and regulatory changes; and required future capital expenditure (refurbishment or
replacement of key components). The lifetime capacity has initially been assessed using an assumed 2.7
million linear metres production per annum (based on a weighted average of the original equipment
manufacturer’s warranted minimum annual production capacity for each of three primary material grades
produced) and fifteen years use at full line speed when refurbishment and replacement of key components
would be considered likely. Management will continue to monitor the position for future periods.
In respect of right-of-use leased assets a key estimate is the incremental borrowing rate used to discount
the total cash flows and derive both the opening asset value and lease liability as well as the consequential
depreciation and financing charges. Assessment of the rate, particularly for property, takes account of the
Group’s borrowing rates, financial position and factors specific to leases, including property yields. If the
rate applied had been 1% lower at 4%, it would have increased the transition asset by £350,000, the
transition liability by £280,000 and reduced the debit to retained earnings by £70,000. The depreciation
charge for the year ended 30 September 2023 would have been £32,000 higher and financing charges
£33,000 lower with a net £1,000 impact on the profit and loss account.
The carrying values are tested for impairment when there is an indication that the value of the assets might
not be realisable or impaired. When carrying out impairment tests these are based upon future cash flow
forecasts and these forecasts include management estimates for sales pricing and volumes informed by
external market forecasts and experience. Future events or changes in the market could cause the
assumptions to change, therefore this could have an adverse effect on the future results of the Group.
Other intangible assets (Note 13)
As set out in the policy in note 1, intangible assets acquired in a business combination are capitalised and
amortised over their estimated useful lives which may be impacted by future events.
Estimate
Both initial valuations and subsequent impairment tests for intangible assets are based on risk adjusted
future cash flows discounted using appropriate discount rates. These future cash flows will be based on
forecasts for the individual assets or, where the specific cash flows cannot be separately identified, the
62
CGU to which the assets are attributable which include estimated factors and are inherently judgemental.
Future events could cause the assumptions to change which could have an adverse effect on the future
results of the Group.
Judgement
The capitalisation of development costs is also subject to a degree of judgement in respect of the viability
of new products, supported by the results of testing and customer trials, and by forecasts for the overall
value and timing of sales which may be impacted by other future factors which could impact the
assumptions made.
Trade receivables (Note 16)
Estimate Trade receivables are initially recognised at invoiced value. Where specific amounts remain
outstanding or disputed beyond their agreed settlement date management, having reviewed all commercial
documentation, proof of delivery and credit risk of the customer, apply judgement as to the likelihood of
the future settlement. This judgement will be influenced by the passage of time, the documentation
available and previous experience of collection of past due invoices with that customer and the Group’s
customer base in general.
In addition, where the Group has historic experience of a rate of loss against a specific group of receivables
(or where circumstances are indicative of a likely future change in the rate of estimated loss) then a change
in that estimated loss rate would alter the impairment provision recognised.
3. Financial instruments – risk management
The Board has overall responsibility for the determination of the Group’s risk management objectives and
policies. The overall objective of the Board is to set policies that seek to reduce risk as far as possible
without unduly affecting the Group’s competitiveness and flexibility. All funding requirements and financial
risks are managed based on policies and procedures adopted by the Board of Directors.
The Group is exposed to the following financial risks:
(cid:2) Credit risk
(cid:2) Liquidity risk
(cid:2) Foreign exchange risk
(cid:2)
Interest rate risk
In common with all other businesses, the Group is exposed to risks that arise from its use of financial
instruments. The principal financial instruments used by the Group, from which financial instrument risk
arises, are as follows:
(cid:2) Trade and other receivables
(cid:2) Cash and cash equivalents
(cid:2) Trade and other payables
(cid:2) Fixed and floating rate bank loans
(cid:2) Floating rate overdrafts
(cid:2) Fixed rate hire purchase agreements
(cid:2) Fixed rate lease liabilities
(cid:2) Floating rate invoice discounting facilities
63
Group financial instruments by category
Financial assets
Cash and cash equivalents
Trade and other receivables
Total financial assets
Financial liabilities
Financial assets at amortised cost
2023
£000
2,090
3,586
5,676
2022
£000
1,786
3,041
4,827
Financial liabilities at amortised cost
2023
£000
2022
£000
Trade and other payables
Borrowings
Lease liabilities
4,131
3,693
5,169
3,148
3,767
5,452
Total financial liabilities
12,993
12,367
All financial instruments are carried at amortised cost and the carrying value of the Group’s financial assets
and liabilities is considered to approximate to their fair value at the current reporting date. Cash and cash
equivalents are held in sterling, euro, and krona and placed on deposit in UK, German and Swedish banks.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument
fails to meet its contractual obligations. The Group is mainly exposed to credit risk from credit sales. At 30
September 2023, the Group has net trade receivables of £3,286,000 (2022: £2,990,000).
The Group is exposed to credit risk in respect of these balances such that, if one or more customers
encounter financial difficulties, this could materially and adversely affect the Group’s financial results. The
Group attempts to mitigate credit risk by assessing the creditworthiness of customers and closely
monitoring payment history.
The ageing of debtors past due and not impaired is included in note 16. Having assessed the recoverability
of past due invoices, including consideration of time elapsed and associated commercial documents, the
directors have made provision, using the Expected Credit Loss methodology, of £116,000 at 30 September
2023 (2022: £44,000) for doubtful debts.
Credit risk on cash and cash equivalents is considered to be minimal as the counterparties are all
substantial banks with high credit ratings.
Liquidity risk
Liquidity risk arises from the Group’s management of working capital and the continued availability of its
other funding facilities. It is the risk that the Group will encounter difficulty in meeting its financial obligations
as they fall due. The Group actively manages its cash generation and maintains sufficient cash holdings
to cover its immediate obligations. Cash and cash equivalents at the year-end were £2.1m (2022: £1.8m).
There was an unutilised invoice discounting facility at 30 September 2023 of up to £3.5m subject to eligible
receivables (2022: £3.5m discounting facility) and unutilised overdrafts in Germany and Sweden totalling
£0.2 million, together with the existing undrawn hire purchase facilities of £0.4m (2022: £0.4m) for capex.
The parent company has drawn down on term loan facilities of £3.5m in July 2020 in order to improve the
overall liquidity and has loaned this to subsidiary companies where required for their working capital
requirements. Repayments of £0.15m have been made during the year, following a period of agreed
payment deferments.
64
The tables below set out the maturities of the Group’s financial liabilities, including interest payments as
at the year-end dates:
At 30 September 2023
Up to 1 year
£000
1 to 2 years
£000
2 to 5 years
£000
Over 5 years
£000
Trade and other payables
Bank loans
Hire purchase liabilities
Lease liabilities
Total
4,131
1,410
86
934
6,561
-
1,548
172
923
2,643
-
696
-
2,665
3,361
-
58
-
1,126
1,184
At 30 September 2022
Up to 1 year
£000
1 to 2 years
£000
2 to 5 years
£000
Over 5 years
£000
Trade and other payables
Bank loans
Hire purchase liabilities
Lease liabilities
Total
3,148
1,003
105
1,073
5,329
-
1,070
54
1,017
2,141
-
1,939
-
2,455
4,394
-
93
-
1,880
1,973
Subsequent to the year end, term loan capital repayments have continued according to the most recent
repayment schedules agreed with the Group’s lenders.
Foreign exchange risk
Foreign exchange risk is the risk that movements in exchange rates adversely affect the profitability or cash
flows of the business.
The majority of the Group’s financial assets are held in Sterling but movements in the exchange rate of
the Euro, the US Dollar and the Swedish Krona against Sterling have an impact on both the result for the
year and equity. The Group considers its most significant exposure is to movements in the Euro, although
there are no material net foreign currency denominated assets/liabilities in the Group other than the
Swedish Krona denominated goodwill in respect of Autins AB at 30 September 2023.
Interest rate risk
The Group’s exposure to market risk for changes in interest rates relates primarily to cash and external
borrowings (including overdrafts and invoice discounting arrangements).
The Group has a limited exposure to cash flow interest rate risk. Borrowings under asset finance/hire
purchase arrangements are at a fixed interest rate over their term, a fixed rate of 7.5% applies to the £1.5m
MEIF growth funding loan and 1.03% to a German bank loan of £0.3m. The CBIL term loan was also
converted to a fixed rate of 4.69% from October 2022. Lease liabilities have been derived by applying an
incremental borrowing rate of 5% for the major property leases which were in place at transition to IFRS
16 in 2019 and 8% to the new lease additions since then.
The interest rates applicable to the fixed rate borrowings are lower than current market rates and the
estimated fair value is considered to be some £180,000 lower than the carrying value of the liabilities as a
result of the interest rates fixed at less than current market rates (2022: no material difference between
their carrying value and fair value).
All borrowing is approved by the Board of Directors to ensure that it is conducted at the most competitive
rates available to it.
Capital management
The Group is financed by a mixture of equity, term loans and invoice discounting facilities as required for
working capital purposes and with hire purchase finance used for certain capital projects. The capital
comprises all components of equity which includes share capital, retained earnings and other reserves.
The Company’s and Group’s objectives when maintaining capital are to safeguard the entity’s ability to
continue as a going concern, so that it can continue to provide returns for shareholders and benefits for
other stakeholders; and to provide an adequate return to shareholders by pricing products and services
commensurately with the level of risk.
65
All working capital requirements are financed from existing cash with invoice discounting resources
available if required.
The Company and Group sets the amount of capital it requires in proportion to risk. The Group manages
its capital structure and makes adjustments to it in the light of changes in economic conditions and the risk
characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Group may
adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares, or
sell assets to reduce debt.
4. Revenue and segmental information
Revenue analysis
Revenue, recognised at a point in time, arises from:
Sales of components
Sales of tooling
2023
£000
22,513
166
2022
£000
18,577
296
22,679
18,873
Segmental information
The Group currently has one main reportable segment in each year, namely Automotive (NVH) which
involves provision of insulation materials to reduce noise, vibration and harshness to automotive
manufacturing. Turnover and operating profit are disclosed for other segments in aggregate, mainly flooring,
as they individually do not have a significant impact on the Group result. These segments have no material
identifiable assets or liabilities.
Factors that management used to identify the Group’s reportable segments
The Group’s reportable segments are strategic business units that offer different products and services.
Measurement of operating segment profit or loss
The accounting policies of the operating segments are the same as those described in the summary of
significant accounting policies.
The Group evaluates performance on the basis of operating profit/(loss). Automotive remained the only
significant segment in the year although the German subsidiary has developed and maintained acoustic
flooring sales to offset some of the impact of the depressed automotive market.
The Group’s non-automotive revenues, mainly acoustic flooring, is included within the others segment.
66
Segmental analysis for the year ended 30 September 2023
Group’s revenue per consolidated statement of
comprehensive income
Automotive
NVH
£000
Others
£000
2023
Total
£000
20,074
2,605
22,679
Depreciation
Amortisation
1,712
199
Segment operating loss
(687)
(59)
(746)
Finance expense
Profit on disposal of joint venture interest
Share of post-tax loss of equity accounted joint
ventures
Group loss before tax
Additions to non-current assets
Reportable segment assets/total Group assets
Reportable segment liabilities/total Group liabilities
Segmental analysis for the year ended 30 September 2022
(501)
201
5
(1,041)
1,225
24,256
13,441
-
-
-
1,225
24,256
13,441
Group’s revenue per consolidated statement of
comprehensive income
Automotive
NVH
£000
Others
£000
2022
Total
£000
15,271
3,602
18,873
Depreciation
Amortisation
1,715
163
Segment operating loss
(2,968)
(16)
(2,984)
Finance expense
Share of post-tax loss of equity accounted joint
ventures
Group loss before tax
Additions to non-current assets
Reportable segment assets
Investment in joint ventures
Reportable segment assets/total Group assets
Reportable segment liabilities/total Group liabilities
865
24,373
-
24,373
12,712
(542)
(26)
(3,552)
865
24,373
74
24,447
12,712
-
-
-
-
67
Revenues from one UK customer in FY23 total £7,658,000 and £3,800,000 of revenue arose from two
other European customers (FY22: one customer £6,673,000 and £2,287,000 of revenue arose from
another European customer). This largest customer purchases goods from Autins Limited in the United
Kingdom and there are no other customers which account for more than 10% of total revenue.
External revenues by location of customers
United Kingdom
Sweden
Germany
Other European
Rest of the World
2023
£000
12,832
709
6,434
2,595
109
22,679
2022
£000
10,570
645
5,917
1,706
35
18,873
The material non-current assets outside of the United Kingdom are £892,000 (2022: £788,000) of fixed
assets including right-of-use assets and £488,000 (FY22: £519,000) of goodwill in respect of the Swedish
subsidiary, together with £564,000 of fixed assets (FY22: £264,000) in Germany. £268,000 (FY22:
£491,000) of cash balances are held in Germany with the cash partly utilised to repay intercompany debt
owed to a UK group company.
5. Operating loss
The operating loss is stated after charging/(crediting):
Foreign exchange losses/(gains)
Depreciation of property, plant and equipment
Depreciation of right-of-use assets
Amortisation of intangible assets
Cost of inventory sold
Impairment of trade receivables
Research and development expenditure
Other government assistance and grants
Employee benefit expenses (see note 6)
Lease payments (short term leases only)
Auditors’ remuneration:
Fees for audit of the Group
2023
£000
43
895
817
199
14,910
72
11
(6)
6,210
164
70
2022
£000
(8)
884
831
163
13,652
-
12
(28)
6,273
123
69
6. Staff costs
Wages and salaries
Social security costs
Other pension costs
Group
2023
£000
5,295
751
164
6,210
Group
2022
£000
5,371
753
149
6,273
Company
2023
£000
Company
2022
£000
1,106
143
49
1,298
1,322
181
53
1,556
The average monthly number of employees during each year was as follows:
Directors
Administrative and development
Production
2023
Number
2022
Number
2023
Number
2022
Number
4
43
117
164
4
13
-
17
4
13
-
17
4
44
110
158
68
Group key personnel are considered to be the directors and senior management team of Autins Group plc
and Autins Limited which is the largest trading entity in the Group. The remuneration of Group key personnel
is disclosed in note 24.
7.
Directors remuneration
Year ended 30 September 2023
Salary
£000
Benefits
£000
Pension
£000
A Attwood
A Burn (appointed 15 May 2023)
G Kaminski-Cook
K Munir
N MacDonald (resigned 30 June 2023)
60
17
254
188
34
553
-
-
11
3
-
14
-
-
-
17
-
17
Year ended 30 September 2022
Salary
£000
Benefits
£000
Pension
£000
A Attwood
G Kaminski-Cook
K Munir
N MacDonald
60
254
187
45
546
-
20
13
-
33
-
-
19
-
19
Total
£000
60
17
265
208
34
585
Total
£000
60
274
219
45
598
Retirement benefits are accruing to 2 directors under defined contribution schemes (2022: 2).
8. Finance expense
Bank interest
Amortisation of loan issue costs
Right-of-use asset financing charges
Interest element of hire purchase agreements
`
9.
Income tax
(i)
Tax credit in income statement excluding
share of tax of equity accounted for joint
ventures
Current tax expense
Current tax on loss for the period
Prior year adjustments
Total current tax
Deferred tax credit
Origination and reversal of timing differences
Prior year adjustments
Total deferred tax
Total tax credit
69
2023
£000
200
16
265
20
501
2023
£000
(52)
(58)
(110)
(18)
-
(18)
(128)
2022
£000
208
15
299
20
542
2022
£000
(108)
(248)
(356)
46
33
79
(277)
(ii)
Total tax credit
Tax credit excluding share of tax of equity accounted for
joint ventures (as stated above)
Share of tax (credit) of equity accounted joint ventures
2023
£000
(128)
-
2022
£000
(277)
-
(128)
(277)
No tax arises in respect of other comprehensive income.
The reasons for the difference between the actual tax charge for the year and the standard rate of
corporation tax in the United Kingdom applied to the loss for the year are as follows:
Loss for the year
Income tax credit (including tax on joint ventures)
Loss before income taxes
Expected tax credit based on corporation tax
rate of 22% in 2023 (2022: 19%)
Expenses not deductible for tax purposes
Enhanced R&D tax relief
Tax credit claimed at lower rate of 14.5%
Tax losses not recognised
Prior year adjustments
Total tax including joint ventures
2023
£000
(913)
(128)
(1,041)
(229)
4
(48)
41
162
(58)
(128)
2022
£000
(3,275)
(277)
(3,552)
(675)
3
(80)
34
656
(215)
(277)
In May 2021 the corporation tax rate was increased to 25% by the Finance Bill 2021, effective from April
2023. Deferred taxes at the balance sheet date have been measured using the enacted tax rates and the
expected timing of reversals. The rate of 25% is accordingly applied to UK deferred taxation balances at 30
September 2023 (2022: 25%).
The current rate of corporation tax in Sweden is 21% and the current rate of corporation tax in Germany is
30%. The Group’s Swedish subsidiary did not have taxable profits during the years under review and the
German subsidiary profits have to date been substantially offset by losses brought forward.
10. Earnings per share
Loss used in calculating basic and diluted EPS
Number of shares
Weighted average number of £0.02 shares for the
purpose of basic earnings per share (‘000s)
Weighted average number of £0.02 shares for the
purpose of diluted earnings per share (‘000s)
Earnings per share (pence)
Diluted earnings per share (pence)
2023
£000
(913)
54,601
54,601
(1.67)p
(1.67)p
2022
£000
(3,275)
51,683
51,683
(6.34)p
(6.34)p
Earnings per share have been calculated based on the share capital of Autins Group plc and the earnings of
the Group for both years. There are options in place over nil (FY22: 2,523,648) shares that were anti-
dilutive at the year-end but which may dilute future earnings per share.
70
11. Property, plant and equipment
Group Plant and
machinery
£000
Leasehold
improvement
£000
Fixtures and
fittings
£000
COST
At 1 October 2021
Additions
Foreign exchange movement
At 30 September 2022
Additions
Disposals
Foreign exchange movement
At 30 September 2023
DEPRECIATION
At 1 October 2021
Charge for year
Foreign exchange movement
At 30 September 2022
Charge for year
Disposals
Foreign exchange movement
At 30 September 2023
NET BOOK VALUE
At 30 September 2023
At 30 September 2022
At 30 September 2021
13,915
160
(23)
14,052
524
(229)
(107)
14,240
4,661
831
(1)
5,491
841
(112)
(44)
6,176
8,064
8,561
9,254
171
28
-
199
1
-
-
200
57
14
-
71
15
-
-
86
114
128
114
571
31
-
602
8
-
-
610
303
39
-
342
39
-
-
381
229
260
268
Total
£000
14,657
219
(23)
14,853
533
(229)
(107)
15,050
5,021
884
(1)
5,904
895
(112)
(44)
6,643
8,407
8,949
9,636
In the prior year, given the backdrop of difficult global economic fundamentals, a detailed review of fixed
assets was conducted considering remaining economic life, utilisation rates, and potential disposal
values. This resulted in £181,000 of additional depreciation being charged against plant and machinery
in the prior year.
Net book value of assets held under hire purchase contracts are as follows:
At 30 September 2023
At 30 September 2022
Plant and
machinery
£000
576
330
Depreciation of £52,000 was charged on these assets in the year (2022: £56,000).
The Neptune plant and equipment represents £4.7m (2022: £4.7m) of the net book value. The Directors,
having prepared discounted cash flow assessments for both the NVH segment within which the goodwill is
allocated and the Neptune facility as a standalone cash generating unit, are satisfied that the carrying values
remain appropriate. The profit improvement actions already taken have significantly improved margins,
meaning that the overall carrying value of the Neptune plant and equipment is supported at an annual
revenue level of £4m. This assessment is made considering Neptune materials sales value only. When
considering component sales margins incorporating Neptune material, the annualised sales volumes in
FY23 exceeded £8m. Latest sales enquiry levels and actual conversion into orders indicate that even a slow
growth rate means that we should continue exceeding consolidated sales of £8m per annum. Accordingly,
no impairment of the Neptune assets is required.
The Company has fixed assets with a cost for office equipment of £3,000 at 30 September 2021, 2022 and
2023, with £1,000 of depreciation in FY22 and FY23 and a net book value of £nil (2022: £1,000).
71
12. Right-of-use assets
The right-of-use assets are as follows:
Group
At 1 October 2022
Additions
Foreign exchange movements
Depreciation charge for the year
At 30 September 2023
At 1 October 2021
Additions
Foreign exchange movements
Depreciation charge for the year
At 30 September 2022
The lease liabilities relating to these are:
Group
At 1 October 2022
Additions
Foreign exchange movements
Lease payments
Financing charge for the year
At 30 September 2023
Current
Payable in 2-5 Years
Payable after 5 Years
Group
At 1 October 2021
Additions
Foreign exchange movements
Lease payments
Financing charge for the year
At 30 September 2022
Current
Payable in 2-5 Years
Payable after 5 Years
Property
£’000
Plant and
machinery
£’000
Total
£000
4,468
330
(40)
(745)
4,013
4,768
480
(30)
(750)
4,468
81
280
-
(72)
289
108
54
-
(81)
81
4,549
610
(40)
(817)
4,302
4,876
534
(30)
(831)
4,549
£000
5,452
610
(42)
(1,116)
265
5,169
889
3,207
1,073
£000
5,636
534
(30)
(987)
299
5,452
825
2,866
1,761
72
13. Intangible assets
Group
Goodwill
Development
£000
costs
£000
Customer
relationships
£000
Tooling
intellectual
property
£000
COST
At 1 October 2021
Additions
Disposals
Foreign currency differences
At 30 September 2022
Additions
Foreign currency differences
At 30 September 2023
2,206
-
-
(21)
2,185
-
(31)
2,154
AMORTISATION AND IMPAIRMENT
At 1 October 2021
Charge for the year
Disposals
At 30 September 2022
Charge for the year
At 30 September 2023
NET BOOK VALUE
At 30 September 2023
At 30 September 2022
At 30 September 2021
-
-
-
-
-
-
2,154
2,185
2,206
969
112
(135)
-
946
82
-
1,028
330
80
(135)
275
116
391
637
671
639
1,079
-
-
-
1,079
-
-
1,079
1,079
1,079
-
1,079
-
-
-
830
-
-
-
830
-
-
830
616
83
-
699
83
782
48
131
214
Total
£000
5,084
112
(135)
(21)
5,040
82
(31)
5,091
2,025
163
(135)
2,053
199
2,252
2,839
2,987
3,059
The development costs relate to know-how and expertise held by the Group in respect of the production
and use of new materials and design of insulation products.
The Group tests goodwill for impairment annually or where there is an indication that goodwill might be
impaired. The Directors have, in considering impairment of goodwill, reviewed the operating activities and
structure of the Group and considers the goodwill is attributable to a single cash generating unit related to
the existing established products of the automotive NVH segment.
The recoverable amount of that cash generating unit has been determined on a value-in-use basis. Value-
in-use calculations for the cash generating unit are based on projected three-year (2022: three-year)
discounted cash flows, together with a terminal value which assumes a 2.5% (2022: 1%) long term growth
rate currently considered appropriate to the industry in the UK and European markets the Group operates
in. The cash flows have been discounted at pre-tax rates of 11.9% (2022: 11.8%) reflecting the Group’s
weighted average cost of capital adjusted for country-specific tax rates and risks.
Noting that EBITDA improved in FY23 by £2.3m, and cashflow from operating activities improved to £2.1m,
the Directors have reviewed a range of reasonably foreseeable trading forecasts for future periods. The
key assumption which underpins these forecasts relates to the rate of revenue and profit growth and
reflects trading experience, as adjusted for the expected growth from current customer, industry and global
economic data. We have continued to reduce the cost base and improve operational efficiency over the
last 3 years which has significantly improved gross margin. Revenue, supported by demand for new
vehicles, agreed contractual improvements, and new contract wins is expected to show further growth in
FY24 and continue improving into FY25, aided by the continued diversification of the customer base and
product range, a return to profitability and cash generation is expected in the foreseeable future. Recurring
revenues from automotive NVH need to recover to a level of c.£30m a year, which is consistent with
budgeted levels for future years, in order to support the carrying value of the goodwill. Historically, these
revenues were £27m in FY18, prior to the pandemic and before contractual price improvements and further
restructuring actions had been taken. The key sensitivity in the forecasts is the level of revenue. Each 1%
fall in revenue would reduce the headroom of £2.9m by £0.6m.
The Company had a closing net book value of £50,000 (2022: £50,000) for goodwill and £6,000 (2022:
£6,000) for development costs in intangible assets.
73
14. Fixed asset investments
Group
COST AND NET BOOK VALUE
At 30 September 2021
Share of loss for the year
Dividend paid by JV
Net book value at 30 September 2022
Share of profit for the year
Disposal of interest in joint venture
Net book value at 30 September 2023
Interest in
joint ventures
£000
120
(26)
(20)
74
5
(79)
-
The Group’s share of joint venture profit in each year was as follows:
Profit/(loss) before tax
Taxation
Profit/(loss) after tax
2023
£000
5
-
5
2022
£000
(26)
-
(26)
Summarised aggregated financial information in relation to the joint venture’s results included in the
consolidated financial statements is presented below.
2023
£’000
2,048
10
10
5
25
65
16
Year ended 30 September
Revenues
Profit/(loss) after tax
Total comprehensive income/(expense)
Group share of total comprehensive income
Included in the above amounts are:
Depreciation and amortisation
Right-of-use asset depreciation
Interest expense
As at 30 September 2022
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Included in the above amounts are:
Cash and cash equivalents
Current financial liabilities (excluding trade payables)
Non-current financial liabilities (excluding trade
payables)
Net assets (100%)
Group share of net assets
2022
£’000
1,705
(52)
(52)
(26)
11
65
10
£000
717
242
(464)
(347)
94
(154)
(345)
148
74
74
Company
COST AND NET BOOK VALUE
At 30 September 2022 and 2023
Investments in
subsidiaries
£000
16,239
The Directors have considered the carrying value of the investments and consider that this remains
supported by the projections and impairment tests referred to in notes 11 and 13 in respect of the trading
prospects and value in use of the subsidiaries.
The subsidiaries of the Company, which have all been included in the consolidated financial statements
based on their results to 30 September 2023, are as follows:
Name
Principal activity
UK subsidiaries:
Autins Limited
Automotive Insulations Limited
Solar Nonwovens Limited
Autins Technical Centre Limited
Acoustic Insulations Limited
European subsidiaries:
Autins GmbH
Autins AB
DBX Acoustics AB
Supply of insulating materials
Dormant
Supply of insulating materials
Dormant
Dormant
Supply of insulating materials
Supply of insulating materials
Dormant
30 Sept 2023
and 2022
Ownership %
100
100
100
100
100
100
100
100
The Group has agreed to guarantee the liabilities of Solar Nonwovens Limited and Autins Technical Centre
Limited, thereby allowing these companies to take the exemption from an audit under Section 479A of the
Companies Act 2006.
All UK companies are incorporated in England with a registered office at Central Point One, Central Park
Drive, Rugby, Warwickshire, CV23 0WE.
Autins AB and DBX Acoustics AB operate in and are incorporated in Sweden with a registered office at
Hamneviksvägen 12, SE-418 79 Gothenburg. Autins GmbH operates in and is incorporated in Germany
with a registered office at Hilden Amtsgericht, Düsseldorf HRB 70344. They are held by Autins Limited.
The Group held a 50% interest in a joint venture, Indica Automotive Limited, until disposal of this interest
on 29 September 2023. The sale consideration, net of the related fees, was £280,000. A consolidated
profit on disposal of £201,000 has been recorded compared to the carrying value at the date of sale of
£79,000.
15. Inventories
Group
Raw materials
Work in progress
Finished goods
2023
£000
1,652
33
658
2,343
2022
£000
2,040
57
572
2,669
Inventory is stated net of impairment provisions of £383,000 (2022: £245,000). The Company has no
inventories.
75
16. Trade and other receivables
Group
2023
£000
Group
2022
£000
Company
2023
£000
Company
2022
£000
Trade receivables
Provisions for impairment
Trade receivables net
Amounts owed by subsidiaries
Amount owed by equity-accounted
joint venture controlled entities
Tooling contract balances
Other receivables
Total financial assets other than
cash equivalents classified as
receivables
Corporation tax debtor
Other receivables
Prepayments
Total trade and other receivables
The analysis of trade receivables is as
follows:
Not yet due gross amount
Past due gross amount
Past due impairment loss allowance
3,402
(116)
3,286
-
-
57
243
3,586
166
22
501
4,275
3,011
391
(116)
3,286
3,034
(44)
2,990
-
15
-
36
3,041
123
-
269
3,433
2,615
419
(44)
2,990
-
-
-
8,935
-
-
10
8,945
-
11
52
9,008
-
-
-
-
-
-
-
10,738
10
-
-
10,748
-
108
55
10,911
-
-
-
-
With the exception of one customer which accounts for 49% (2022: 32%) of the net trade receivable
balance at the year end, credit risk with respect to accounts receivable is dispersed due to the number of
customers. An impairment allowance of £72,000 has been charged (2022: £nil) in respect of specific trade
receivables for the year ended 30 September 2023. The expected credit loss in respect of debt not due
and past due is otherwise considered immaterial.
The Group has financing agreements whereby certain trade debts can be subject to an invoice discounting
agreement which is secured against the associated trade receivables. The amounts outstanding at 30
September 2023 were £nil (2022: £nil).
The movement in the provision for trade receivables is as follows:
Group
At 1 October
Charged in year
Receivables written off in year
At 30 September
2023
£000
44
72
-
116
2022
£000
48
-
(4)
44
76
The movement in the tooling contract assets balances are as follows:
Brought forward at 1 October
Additions during the year
Recognised as cost of sales in the year
Assets as at 30 September
2023
£’000
-
153
(96)
57
Revenue yet to be recognised on tooling contract balances
98
2022
£’000
-
204
(204)
-
-
17. Trade and other payables
Group
2023
£000
Group
2022
£000
Company
2023
£000
Company
2022
£000
Current
Trade payables
Amounts owed to subsidiaries
Amount owed to equity-accounted joint
venture controlled entities
Accruals
Total financial liabilities, excluding loans
borrowings, classified as financial
liabilities measured at amortised cost
Social security and other taxes
Deferred income
Total current trade and other payables
Non-current liabilities
Deferred income
2,351
-
-
1,551
-
175
208
7,963
-
66
8,585
-
1,780
1,422
240
291
4,131
331
6
4,468
3,148
204
6
3,358
8,411
8,942
47
-
48
-
8,458
8,990
99
105
-
-
No interest is payable on the amounts owed to the company or by the company to its subsidiaries except
for a loan to the German subsidiary of €1.74m on which a rate of 5.0% is charged.
18. Borrowings
Bank loans and overdrafts
Unamortised issue costs
Hire purchase liabilities
Total borrowings
Bank loans
Hire purchase liabilities
Current
Bank loans – instalments due in 2 to 5 years
Bank loans – instalments due in more than 5 years
Hire purchase liabilities due in 2 to 5 years
Non-current
Group
2023
£000
Group
2022
£000
Company
2023
£000
Company
2022
£000
3,473
(17)
237
3,693
1,228
78
1,306
2,171
57
159
2,387
3,658
(33)
142
3,767
772
88
860
2,761
92
54
2,907
3,254
(17)
-
3,237
1,195
-
1,195
2,042
-
-
2,042
3,400
(33)
-
3,367
739
-
739
2,628
-
-
2,628
Bank loans and overdrafts are secured by fixed and floating charges over the Group’s assets.
77
Principal terms and the debt repayment schedule of the Group’s bank borrowings are as follows:
Bank term CBIL
Nominal
Currency
GBP
Conditions
Secured
MEIF term loan
GBP
Secured
German bank
loan
Euro
Secured
Repayable by
quarterly instalments
Repayable by
instalments
Repayable by
instalments
Rate %
4.69% fixed
rate
7.50% fixed
rate
1.03% fixed
rate
Year of
Maturity
2026
2024
2030
Net obligations under hire purchase contracts are denominated in sterling and secured on the assets to
which they relate.
Details of financing facilities are also included in note 3, liquidity risk.
Hire purchase liabilities
The future minimum lease payments in respect of hire purchase liabilities are as follows:
Group
2023
£000
Less than one year
Between one and five years
Total gross payments
Less: interest charge allocated to future periods
Carrying amount of liability
85
173
258
(21)
237
2022
£000
105
54
159
(17)
142
19. Deferred tax
Deferred tax is calculated in full on temporary differences under the liability method using a tax rate of 25%
(2022:25%) for the UK, 21% (2022: 21%) for Sweden and 30% for Germany (2022: 30%). The movement
on the deferred tax account is as shown below:
Opening net liability/(asset)
Total (credit)/charge recognised in profit and loss
Closing net liability
Group
Deferred tax (asset)
Accelerated capital allowances
Losses
Other temporary differences
Closing asset
Deferred tax liability
Deferred tax on intangible assets
Closing liability
2023
£000
30
(18)
12
2023
£000
768
(826)
58
-
12
12
2022
£000
(49)
79
30
2022
£000
855
(894)
39
-
30
30
The Group’s deferred tax balances have arisen primarily due to the timing differences on accelerated
capital allowances, recognition of intangible assets on acquisition or development costs and tax losses
carried forward.
78
The Company deferred tax asset recognised is £nil (2022: £nil). The company has an unrecognised
deferred tax asset of approximately £1,500,000 (2022: £1,424,000) in respect of losses carried forward.
The Group has an unrecognised deferred tax asset of approximately £2,100,000 at 30 September 2023
(2022: £2,033,000) in respect of losses carried forward as it is, as yet, uncertain when these will be
utilised.
Group tax losses have been recognised where there is capacity to utilise them against specific group or
joint venture profits or where budgets and forecasts indicate that they can be used to offset overseas
trading profits within the next two years, supported by the trend in trading results and order books in these
entities.
20. Share capital
Allotted, issued and fully paid ordinary shares of £0.02 each
Number
At 30 September 2022 and 2023
54,600,984
£’000
1,092
All of the ordinary shares are non-redeemable, have voting rights and participate equally in any income or
capital distributions.
21. Share based payment (Company and Group)
Share options are granted to directors and selected employees.
2,858,107 share options were granted in January 2021 with an effective nil cost exercise price. These
were exercisable in 3 tranches subject to meeting EBITDA targets for the 3 years ending 30 September
2023 and with 1,587,837 of them also dependent on growth in the share price. The fair value of the options
issued was primarily determined using a Black Scholes model and was calculated at 20 pence per share
option for the EBITDA performance only options and 15p per share option for those subject to both
conditions.
334,459 options lapsed in 2021 and 2,523,648 at 30 September 2023 as, following the difficult trading
conditions, no options will vest. The cumulative share based payment charge is therefore nil.
There were no unexpired options in place at 30 September 2023 (2022: 2,523,648 and with an average
exercise price of £nil and a remaining average exercise period of 2 years).
22. Reserves
The share premium account represents the amounts subscribed for shares in excess of the nominal value,
net of any directly attributable issue costs.
Retained earnings are the cumulative net profits in the consolidated statement of comprehensive income.
Movements on these reserves are set out in the consolidated statement of changes in equity.
The cumulative currency differences reserve represents translation differences in respect of the net assets
of overseas subsidiaries.
Other reserves of £1,391,000 arose from the difference between the fair value and nominal value of shares
issued in partial satisfaction of the acquisition of 100% of the equity of Autins Limited (formerly Automotive
Insulations Limited) in April 2014 and £495,000 from the difference between the fair value of shares issued
and the existing cost of investment in order to acquire the remaining 50% of Autins AB and 10% of Autins
GmbH in April 2016.
23. Commitments
The Group leases all its office and manufacturing properties as well as a number of vehicles and forklifts
used by the business. The lease terms vary from 3 years for vehicles, property rentals with an annual
rolling renewal for certain overseas properties through to 15 year terms for the principal UK manufacturing
sites, which are subject to three yearly rent reviews.
The Group had capital commitments at 30 September 2023 of £nil (2022: £nil).
The Company had no lease or capital commitments.
79
24. Related party transactions
Share options
Directors held the following unexpired share options at 30 September 2022. These lapsed at 30 September
2023 as the conditions were not met.
G Kaminski-Cook
K Munir
Transactions with related parties and key management personnel
Group key management personnel costs
Group aggregate salaries and short term benefits
Post employment benefits
Number
1,459,459
1,064,189
2,523,648
2023
£000
1,310
66
1,376
2022
£000
1,401
38
1,439
Indica Automotive Limited is a joint venture undertaking in which the Group had joint control until 29
September 2023.
Transactions:
Sales and costs recharged to joint venture in year
Purchases from joint venture in the year
Balance at the year-end owed to the Group (unsecured)
Balance at the year-end (owed by) the Group (unsecured)
2023
£000
81
1,089
n/a
n/a
2022
£000
86
1,084
15
(175)
25. Control
In the opinion of the Directors there is no one ultimate controlling party.
80
Directors, Secretary, Registered Office and Advisors
Directors
Adam Attwood, Non-Executive Chairman
Andrew Burn, Non-Executive Director
Gareth Kaminski-Cook, Chief Executive Officer
Mark Taylor, Non-Executive Director
Kamran Munir, Chief Financial Officer
Company Secretary
Kamran Munir
Registered Office
Central Point One
Central Park Drive
Rugby
Warwickshire
CV23 0WE
Telephone Number
+44(0)1788 578 300
Website
www.autins.com
Nominated Advisor and Broker
Solicitors to the Company
Auditors
Public Relations
Registrars
Singer Capital Markets
1 Bartholomew Lane
London
EC2N 2AX
Freeths LLP
1 Vine Street
Mayfair
London
W1J 0AH
Dains Audit Ltd
15 Colmore Row
Birmingham
B3 2BH
Newgate Communications
50 Basinghall Street
London
EC2V 5DE
Link Asset Services
The Registry
34 Beckenham Road
Beckenham
Kent
BR3 4TU
81
Perivan.com
267847