Cambria Automobiles plc Annual Report 2014

FY2014 Annual Report · Cambria Automobiles plc
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Annual report and ﬁ nancial statements
Registered number 05754547
31 August 2014

Contents

Chairman’s statement .............................................................. 4

Operating and ﬁ nancial review ............................................... 7

Strategic report ........................................................................16

Directors’ report ...................................................................... 17

Statement of directors’ responsibilities in respect of the 
Directors’ report and the ﬁ nancial statements .....................18

Independent auditor’s report to the members of Cambria 
Automobiles plc ......................................................................19

Consolidated statement of comprehensive income ............. 20

Consolidated statement of changes in equity ....................... 21

Consolidated statement of ﬁ nancial position ...................... 22

Consolidated cash ﬂ ow statement .........................................23

Notes ....................................................................................... 24

Company balance sheet ......................................................... 54

Company reconciliation of movements in shareholders’ 
funds ....................................................................................... 55

Notes ....................................................................................... 56

22
2

333

Chairman’s Statement

I am very pleased to report that Cambria has delivered a good set of results for the year ended 31 August 2014, which show continued improvement 

in the Group’s operational and ﬁ nancial performance. 

The  UK  motor retail  industry continued to strengthen during the period under review. Building on our  improved ﬁ nancial performance  in 

2012/2013, the Group generated gross proﬁ t growth across all core elements of the business, New Vehicles, Used Vehicles and Aftersales, as well 

as delivering a signiﬁ cant premium brand acquisition in line with our evolving strategy for growth.

Revenue increased by 14% to £450.1m (2013: £395.8m). Underlying proﬁ t before tax rose by 32% to £5.4m (2013: £4.1m).  Proﬁ t before tax also 

improved by 32% to £5.3m (2013: £4.0m), giving earnings per share of 4.15p (2013: 3.49p) - an increase of 19%. 

The Group closed the year with net debt of £4.6m (2013: net cash £2.9m) and net assets of £28.3m (2013: £24.6m), underpinned by the ownership 

of £35.7m (2013: £25.8m) of freehold and long leasehold properties. Resources remain high with total facilities available to the Group, including 

cash reserves, of £19.3m (2013: £23.8 m).

Group Overview
Cambria was established  in  2006 with a  strategy  to  build  a  balanced  motor  retail group  through close cooperation with our  manufacturer 

partners and the self funded acquisition and turnaround of underperforming businesses. 

In  last year’s  report,  I  stated  that  the  Group  had  worked  hard  to  develop  a  strong  ﬁ nancial  position,  which  would  allow  us  to  expand  our 

acquisition strategy to include businesses that were immediately earnings enhancing. We actively delivered on this strategy during the year, 

announcing the acquisition of the Jaguar and Land Rover dealership in Barnet on 8 July 2014 for a total consideration of £10.5m, including £3.75m 

of freehold land and property.

4

The  strength  of  the  Group’s  balance  sheet  now  allows  us  to  pay  larger  premiums  for  the  right  acquisitions,  using  self-generated  funds,  to 

purchase earnings enhancing businesses, like Barnet, which, ﬁ t our brand balance ambitions and ﬁ nancial return criteria. 

Following the acquisition, and with the addition of the Jeep franchise to the Group’s existing site in Oldham, the Group now comprises 28 

dealerships, representing 45 franchises and 18 brands resulting in a well balanced portfolio spanning the high luxury, premium and volume 

segments.

The  Group enhanced  its  freehold property portfolio during the year, securing the  freehold  interests of  both the Warrington site, where we 

represent Fiat and Nissan, and our Croydon site, where we represent Ford. 

The  management  team  has  done  an  exceptional  job  in  producing  strong  returns  from  underperforming  businesses  through  its  focus  on 

developing and implementing industry leading digital systems, delivering a world class Guest (customer) experience and maintaining tight 

management of costs, coupled with lean operating procedures.  During the period, the Group was awarded the Motor Trader “Dealer Group of 

the Year” award. This is testament to the quality of the Cambria Associates (our employees) who have helped build the Group over the last eight 

years.

Our relationship with the manufacturers that we represent is a core pillar of our business approach. The management team continues to develop 

and maintain strong working relationships, in which Cambria is seen as an eﬀ ective and valued business partner. The addition of Land Rover, as 

well as a further Jaguar and Jeep business, has expanded our brand representation during the year and strengthened the foundations for further 

development. 

I would also like to thank the Cambria Associates, who continue to demonstrate commitment to the Group. We believe that our investment in 

their development, through the Cambria Academy, will increase skill levels in our Guest facing sales force and their ability to provide a world 

class Guest experience.

5

 
 
Chairman’s Statement (continued)

Dividend
The Board is pleased to announce a ﬁ nal dividend of 0.5p per share (2013: 0.4p), resulting in a total dividend for the year of 0.6p per share (2013: 

0.5p) - an increase of 20%.  It remains the Board’s intention to grow dividends in line with earnings.

Outlook
Since the industry lows experienced in Q4 2011, the UK market has enjoyed 32 consecutive months of year-on-year growth in new car registrations 

to October 2014. The economic pressures aﬀ ecting the mainland European new car markets remain and the UK continues to be well placed to 

continue with the current positive new car market for the foreseeable future.

I am pleased to report that Cambria has maintained its growth momentum in the ﬁ rst two months of the new ﬁ nancial year, delivering results 

ahead of our business plan and substantially ahead of the comparable period of the year under review.  We have a number of opportunities under 

review and continue to be active in our acquisition strategy, whilst maintaining our aim to produce superior returns on shareholders’ funds, 

which reached 15.9% in the year under review (2013: 15.5%).

The Board believes that there are signiﬁ cant opportunities for further growth and is conﬁ dent of making strong progress in 2014/15.

Philip Swatman
Chairman

6

Operating and Financial Review

Chief Executive’s Review

Mark Lavery, Chief Executive  

I  am  pleased  to  report  that  the  operational  and  ﬁ nancial  performance  improvements  delivered  in  H1  2014 

continued into the second half and the Group delivered a good set of results for the full year to 31 August 2014 with 

underlying proﬁ t before tax rising to £5.4m, a 32% increase in proﬁ ts on the previous year.

The ﬁ nancial year under review coincided with another year of strong growth in the UK motor retail market. Up to and including the 

October 2014 registration data, the UK has enjoyed 32 consecutive months of year on year growth in new car registrations albeit from a 

low base in Q4 2011. 

7

Operating and Financial Review

In line with our revised acquisition strategy set out last year, we completed the purchase of the Jaguar and Land Rover dealership in Barnet in July 

2014, adding our sixth Jaguar and ﬁ rst Land Rover dealership to the Group. The integration of this business is progressing well and the business 

has operated in line with our expectations during the ﬁ rst seven weeks of ownership. 

The table below summarises our ﬁ nancial performance, which is detailed in the Finance Director’s Report:

Year ended 31 August

Revenue

Underlying EBITDA*

Underlying operating proﬁ t*

Underlying proﬁ t before tax*

Underlying net proﬁ t margin*

EBITDA

Operating proﬁ t

Proﬁ t before tax

Non-recurring expenses

Net Assets  

Net proﬁ t margin

Underlying earnings per share*

Earnings per share

* These items exclude non-recurring expenses of £0.1m (2013: £0.1m)

2014
£m

450.1

7.4

5.9

5.4

1.2%

7.3

5.8

5.3

0.1

28.3

1.2%

4.22p

4.15p

2013
£m

395.8

6.1

4.6

4.1

1.0%

6.0

4.5

4.0

0.1

24.6

1.0%

3.57p

3.49p

8

Operating and Financial Review (continued)

I am pleased to report that the Group has again generated strong operating cashﬂ ow during the year, which enabled us to acquire the Barnet 

business and enhance our operating freehold properties.  The Group’s cash position remains strong and we have signiﬁ cant facilities available 

for continued expansion. Accordingly, we have continued to invest resource in identifying acquisition opportunities, whilst also investing in our 

existing franchise outlets to ensure that they remain compliant with franchise standards and secure a long term future for the Group with its 

respective brand partners. It is very important for Cambria to continue to strengthen the mix of its brand portfolio, maintaining a good balance 

of high luxury, premium and volume brands as the Group grows. 

Brand Partnerships

In line with our buy-and-build strategy, management has continued to work with both existing and potential Brand Partners (manufacturers) 

with whom the Group may develop Primary Brand Partner relationships (i.e. more than three franchised dealerships). We have worked hard 

to improve the businesses acquired in previous years and to integrate and develop the ones acquired and established in the year under review, 

making signiﬁ cant investment in the management of those businesses as well as in the property infrastructure.

Our current portfolio of Brand Partners and dealerships comprises:

High Luxury / Premium

Aston Martin

Alfa Romeo

Honda

Jaguar

Land Rover

Volvo

Volume

Abarth

Citroen

Jeep

Dacia

Fiat

Ford

Mazda

Nissan

Renault

Seat

Vauxhall

3

2

2

6

1

5

19

Motorcycle

Triumph

1

1

2

1

5

5

4

1

1

1

2

24

2

2

The Group acquired the Barnet Jaguar Land Rover business for a total consideration of £10.5m, which included £3.75m of freehold land and 

property, £0.46m of ﬁ xed assets and £1.26m of net working capital assets resulting in £5m of goodwill. We have agreed to develop the freehold 

land fully and build a new Jaguar Land Rover dealership at Barnet over the next 18 months at an estimated investment cost of around £5m.  This 

facility will be a state of the art dealership, which will contribute to a signiﬁ cantly enhanced Guest experience and make the business much 

more eﬃ  cient. 

When  we  announced  our  H1  results,  I  was  able  to  report  that  we  had  invested  £6.3m  in  the  Group’s  freehold  property  estate  securing  the 

freeholds of our Warrington Fiat and Nissan dealership and our Croydon Ford dealership, plus additional land for franchise enhancements 

in Croydon.  The investment in these freeholds is in line with our strategy to secure strategic freeholds where the opportunity arises and also 

reduces the external rent payable  by  £0.3m.    In addition to the  major  freehold purchases, we  invested  £0.2m  in the re-development of our 

Oldham dealership to add the Jeep franchise and to bring the site up to current corporate standards for Fiat.  We also invested £0.3m across our 

Ford dealerships in line with franchise standards requirements.

Cambria has enjoyed the beneﬁ ts of a strategically balanced brand portfolio with a strong mix of high luxury, premium and volume businesses 

and we intend to continue our buy-and-build strategy acquiring businesses that further improve the brand mix and represent good value for 

our shareholders.

When making acquisitions, the Board understands that the integration and maturing of the dealerships takes time and management investment. 

The integration of businesses from distressed sales typically takes longer.

We continue to promote the philosophy of stand-alone autonomous business units, in which local management teams are empowered via our 

“Four Pillar Strategy” to run their own business units. Cambria dealerships do not trade under the “Cambria” name but focus on local branding. 

Our dealerships trade as “Grange”, “Doves”, “Dees”, “Invicta Motors”, “County Motor Works”, “Pure Triumph” and “Motorparks. When acquiring 

a business, the Board considers the geographical location of the franchise and then chooses to either adopt a new trading style or retain the 

existing business name. On completion of the Barnet acquisition, the business was re-branded as “Grange”.

9

Automobiles plc

Locations across the UK

Welwyn
Garden City

Brentwood

Chelmsford

Barnet

Thanet

Tunbridge
Wells

Canterbury

Ashford

Maidstone

Gatwick

Horsham

Wimbledon

Croydon

Southampton

Blackburn

Preston

Bolton

Bury

Oldham

Warrington

Wellingborough

Northampton

Woburn

Swindon

Exeter

10

Operating and Financial Review (continued)

Operations

2014
Revenue

2014
Revenue 
mix

2014
Gross 
Proﬁ t

2014
  Margin

2013
Revenue

2013
Revenue 
mix

2013
Gross 
Proﬁ t 

2013
 Margin

£m

195.2

208.9

55.8

(9.8)

%

43.4

46.4

12.4

(2.2)

450.1

100.0

£m

12.3

19.0

23.9

-

55.2

(49.3)

5.9

(0.1)

5.8

%

6.3

9.1

42.9

-

12.3

1.3

£m

159.8

188.8

56.6

(9.4)

%

40.4

47.7

14.3

(2.4)

395.8

100.0

£m

10.6

17.5

23.1

-

51.2

(46.6)

4.6

(0.1)

4.5

%

6.7

9.3

40.8

-

12.9

1.1

2014  

10,451

2013

Year on year growth

8,957

16.7%

New Vehicles

Used Vehicles

Aftersales

Internal sales

Total

Administrative expenses

Operating proﬁ t before non- 
recurring expenses

Non-recurring expenses

Operating proﬁ t

New Vehicle Sales

New units

New vehicle revenue increased from £159.8m to £195.2m with total new vehicle and motorcycle sales volume up 16.7%. Excluding the impact of 

Barnet, our new volumes rose by 16.1%, outperforming the market by 5.5%. Gross proﬁ t also increased by £1.7m with an improvement in the gross 

proﬁ t per retail unit sold.   

This strong performance was delivered against an overall year-on-year increase of 10.6% in new UK car registrations in the 12 month period to 31 

August 2014. New car registrations for the rolling 12 months exceeded 2.4m in this period for the ﬁ rst time since 2007. The private registrations 

element of the new car market increased 12.5% year-on-year. The Group’s sale of new vehicles to private individuals was also ahead of the market - 

14.1% higher year-on-year at 8,874 units. Commercial and ﬂ eet vehicle sales by the Group increased by 54.6% to 977 units and by 8.9% to 600 units 

respectively; these sales are transacted at lower margins hence the dilutive eﬀ ect on overall new car gross margin.

Used Vehicle Sales

Used units

2014  

14,320

2013

Year on year growth

14,036

2%

We have delivered another reasonable performance in used vehicle sales. Revenues increased from £188.8m to £208.9m and the number of units 

sold rose by 2%.  Excluding the impact of Barnet, volumes were up 1.9%. The gross proﬁ t generated increased by £1.5m to £19.0m.  Pleasingly, 

the average gross proﬁ t on each unit retailed increased year on year. The Group has also concentrated on tight management of its used vehicle 

inventories, closely monitoring stock turn and used car Return On Investment which achieved 122% in the year.

11

Operating and Financial Review (continued)

Aftersales

Service and Bodyshop hours

2014  

2013

Year on year growth

316,963

306,611

3.4%

Overall, the service and bodyshop elements of the business increased the number of hours sold by 3.4% and the total aftersales gross proﬁ t by 

£0.8m to £23.9m. The combined aftersales revenue decreased 1.4% year on year from £56.6m to £55.8m, as a result of a £3.5m year on year variance 

in the parts business which was attributable to one speciﬁ c trade customer.  The other areas of aftersales increased their revenue.  The aftersales 

margin increased from 40.8% to 42.9%, due to the reduced mix of Parts revenue relative to Service revenue. The aftersales departments contributed 

43.3% of the Group’s overall gross proﬁ t.

The Group continues to review its processes for ensuring that we engage with all our Guests to maximise the opportunity to interact with them 

through our Guest Relationship Management Programme. This is our contact strategy involving the sale of service plans and delivery of service and 

MOT reminders in a structured manner, utilising all forms of digital media and traditional communication methods.

The 0-3 year car parc continues to be replenished, as new car sales increases year on year, and this gives the Group conﬁ dence of further progress in 

Guest relationship and retention.

Group Strategy

Since the Group’s incorporation in March 2006, we have continued to apply our focused buy-and-build strategy of acquiring motor dealership assets 

using internally generated funds. The earnings enhancing acquisition of the Barnet business was ﬁ rmly in line with our revised strategy and the 

opportunity to develop our relationship with Jaguar and begin a new one with Land Rover ﬁ ts our brand portfolio aspirations perfectly.

Following any acquisition, the Cambria management team implements new ﬁ nancial, operational controls and processes in order to rationalise, 

restructure and develop each individual dealership. A culture of delivering a world class Guest experience is engrained into the business.  This 

tailored approach ensures the changes made to each dealership are sustainable and create shareholder value through achieving an appropriate 

contribution for the level of investment. We have now completed ten separate transactions since our incorporation. 

We will continue with our three step approach to purchasing a new business - acquisition, integration and operation, as outlined below:  

Acquisition

When acquiring new businesses, we are diligent in ensuring that none of the contractual obligations taken on upset the integrity of our balance 

sheet. This includes ensuring that leases reﬂ ect market value and that any unusual contractual obligations are addressed prior to acquisition in 

order to avoid taking on any legacy costs. Prior to the Barnet transaction, the Group balance sheet showed that only £0.3m of goodwill had been 

generated across the nine acquisitions. We do not have any deﬁ ned beneﬁ t pension schemes. We have always taken the approach that Cambria 

will not acquire any business unless there is a strong underlying business case to do so and our acquisitions have been funded from our own cash 

resources and banking facilities. Maintaining the Group’s balanced brand portfolio will be fundamental to its continued success and development 

and this will undoubtedly  mean that we acquire and develop  more  Premium and  Luxury  businesses. All acquisitions and any related funding 

requirements are assessed on their individual merits.  For compelling acquisition targets, like Barnet, we will undoubtedly have to pay a premium 

but we will still focus on ensuring that the Group delivers strong and consistent returns on equity. 

Integration

The integration process starts with an Associate engagement evening where our senior management present the Cambria “Four Pillar” culture 

change  programme.  After  this  meeting,  the  Group  integration  team  implements  systems,  processes  and  procedures  to  improve  legislator 

compliance including FCA and Health & Safety. Newly acquired Associates are transferred to Cambria employment contracts with compensation 

and beneﬁ ts commensurate with the particular business. A training needs analysis is conducted, followed by the implementation of training 

programmes for all relevant Associates in the new business.

Operation

With any new acquisition, the standard ﬁ nancial controls are implemented immediately, ranging from individual cheque signatories to daily 

reporting of vehicle sales and aftersales revenues, margins and other performance ﬁ gures. We then implement our two growth strategies (i) 

“Cambria Digital”, which is our internet social networking strategy for vehicle sales coupled with our “Guest Connect” support centre, and (ii) 

in Aftersales our “Duty of Care Gearbox” and Local Contact Strategy which is designed to supply our Guests with a one stop solution for all their 

vehicle maintenance needs. 

12

 
Operating and Financial Review (continued)

Acknowledgments

We are delighted that Cambria, in addition to the “Motorparks.co.uk” website being voted the best franchised dealer website in the industry in 

the Auto Retail Network report 2013, has also won the Motor Trader “Dealer Group of the Year” award for 2014. This is testament to the success 

of the growth and development of the Group over eight years of acquiring and improving underperforming dealerships.

We were also pleased to be awarded (for the second time) the Platinum Award for Charitable Donations to the industry’s only dedicated charity, 

BEN, the motor trade benevolent fund.  The award results from the combined support of BEN by Cambria Associates, through a payroll giving 

scheme, and speciﬁ c support from the Group.  Cambria is one of only two motor trade organisations in the UK to be given the award and we are 

delighted to continue to support BEN in the outstanding work that they carry out for members of the motor trade and their families.

Cambria Academy

The Group has continued to develop the Cambria Academy, a training Academy for the Group’s Associates, which was established during the 

previous ﬁ nancial year. Whilst still in the developmental phase, this is proving to have a positive impact and it will be critically important as the 

Group embarks on the next exciting period of its expansion. 

The  Academy  has  been  established  to  enhance  the  Cambria  Guest  Experience  with  the  following  key  strategic  objective:    “To  deliver  an 

outstanding experience making it easy for our Guests to buy, own and maintain their vehicle, ensuring that they will want to do so again and 

recommend us to others.”

We will continue to enhance and reﬁ ne the Academy to help develop our own talent pool, promote Associate retention and to create our own 

future management with the overriding objective of enhancing the Guest Experience when interacting with Cambria. 

Outlook

The new ﬁ nancial year has started strongly with the Group’s performance in the ﬁ rst two months being both ahead of our business plan and 

signiﬁ cantly ahead of the comparable period of the year under review. I am pleased with the progress that we are making across our established 

businesses; I am excited by the potential of the newly acquired Jaguar Land Rover business in Barnet; and I am conﬁ dent that Cambria can 

maintain this momentum and deliver further improved performances across all it departments in the current ﬁ nancial year.

Our continued strong cash generation and available facilities  leave us well positioned to develop and protect our  balanced  brand portfolio. 

We shall continue to  focus upon the development of our  high  luxury and premium  brands and  Cambria continues to  invest  in  identifying 

acquisition opportunities.

Whilst there has been 32 consecutive months of year-on-year growth in new car registrations in the UK, we do not believe that the market is yet 

at its peak.   

Vehicle manufacturers continue to deliver strong consumer oﬀ ers, which represent attractive propositions for our Guests to acquire new cars and 

the level of cars sold on PCP related product has increased signiﬁ cantly over the past three years. As a result of the increased penetration of the 

PCP oﬀ ers, there becomes a natural change cycle where a Guest is more likely to change a car for another new one during the term of the PCP 

product. A larger portion of cars sold on PCP gives greater control of the Guest’s change cycle. 

Exchange rates also remain favourable and, whilst Sterling is strong relative to the Euro and the European car market remains relatively weak, 

the UK will be a natural place for the manufacturers to target registrations. Whilst maintaining double digit growth is unlikely, as prior year 

comparatives harden, we expect the new car market in the UK to stay buoyant, as long as vehicle availability and strong consumer oﬀ ers are 

readily available.

Mark Lavery
Chief Executive

13

Operating and Financial Review (continued)

Finance Director’s Report

Overview

Total revenues in the period increased 13.7% to £450.1m from £395.8m in the prior year.  New vehicle unit volumes were up 16.7% and new vehicle 

revenues were up  22.1%.  Used car unit sales and revenues  increased  by  2% and  10.6% respectively.  Revenues  from the aftersales  businesses 

reduced by 1.4%, compared with the previous year as a result of a reduction in sales to one speciﬁ c parts trade customer. 

Total gross proﬁ t increased by £4m (7.8%) from £51.2m to £55.2m in the year. Gross proﬁ t margin across the Group reduced from 12.9% to 12.3%, 

reﬂ ecting the change in revenue mix following the increase in new car sales in total and the improvement in commercial vehicles and ﬂ eet cars. 

The average selling price of both new and used cars increased year on year, as did the average proﬁ t per new and used unit that we sold.  The 

aftersales operations contributed 43.3% of the total gross proﬁ t for the Group, compared to 45.1% in the previous period, at a gross proﬁ t margin 

of 42.9%, improved from 40.8% in the previous year.

During the year, the Group incurred non-recurring expenses of £81,000 in relation to transaction and set up costs associated with the business 

acquisition.

Underlying EBITDA increased by 21.3% in the period to £7.4m from £6.1m in the previous year.  Underlying operating proﬁ t improved 28.3% to 

£5.9m, compared to £4.6m in the previous year, resulting in an underlying operating margin of 1.3% (2013: 1.1%).

Net ﬁ nance expenses were consistent with prior year at £0.5m.

The Group’s underlying proﬁ t before tax rose by 32% to £5.4m, in comparison with £4.1m in the previous year. The acquisition accounted for a 

loss of £20,000 in the year, in line with our budget.

Underlying earnings per share were 4.22p (2013: 3.57p). Basic earnings per share were 4.15p (2013: 3.49p) and the Group’s underlying return on 

shareholders’ funds for the year was 15.9% (2013: 15.5%).

Taxation

The Group tax charge was £1.16m (2013: £0.5m) representing an eﬀ ective rate of tax of 21.8% (2013: 13.3%) on a proﬁ t before tax of £5.3m (2013: 

£4.0m). As outlined in last years report, it was anticipated that the tax rate would revert to a more normal eﬀ ective tax rate compared with the 

prior year, which had a one oﬀ  beneﬁ t from a speciﬁ c capital allowances claim that impacted prior years. It is anticipated that tax charge for 2015 

will continue to track the normal eﬀ ective tax rate for the Group.  

Financial Position

The Group has a robust balance sheet with a net asset position of £28.3m underpinned by £35.7m of freehold and long leasehold property. 

Secured against the freehold and long leasehold property are mortgages amounting to £14.9m. Each of the loans has diﬀ erent repayment proﬁ les 

between ﬁ ve and thirteen years and bear interest at between base plus 1.25% and LIBOR plus 3%. During the year, the Group comfortably met 

the bank covenants attached to these borrowings. 

The net debt position of the Group as at 31 August 2014 was £4.6m (2013: net cash £2.9m), reﬂ ecting a cash position of £10.3m (2013: £14.8m).  

This is after the £18m investment in acquired businesses and freehold land and property in the year.

The Group uses term loan facilities to fund the purchase of freehold and long leasehold properties, stocking loans to fund the acquisition of 

consignment, demonstrator and used vehicles and has a £4m overdraft facility which is used to manage seasonal ﬂ uctuations in working capital. 

The overdraft  facilities are renewable annually and are  next due  in  February  2015. The  Group  has a  £5m  Revolving  Credit  Facility, which  is 

available for draw down against new business acquisitions and freehold property purchases. This additional funding facility gives us signiﬁ cant 

liquidity to identify and approach acquisition targets. Total facilities available including cash reserves equate to £19.3m (2013: £23.8 m).

14

Operating and Financial Review (continued)

Cash Flow and Capital Expenditure

The Group generated an operating cash inﬂ ow of £11.3m with working capital reducing by £4.7m through eﬃ  cient management of the vehicle 

inventory and the stocking  lines associated with that  inventory. Total  funds  invested  in  business acquisitions and capital expenditure were 

£18m, of which £6.7m related to the acquisition of the Barnet business and £11.3m was freehold property, plant and equipment, including the 

Barnet freehold property.  We have drawn down two new term loans totalling £4.7m against the freehold purchase of the Croydon and Barnet 

properties acquired.

During the year, capital repayments of £1.67m were made against the total term loans outstanding. The capital repayments due in the ﬁ nancial 

year to 31 August 2015 total £2.02m. 

As a result of the net cash outﬂ ow of £4.5m, the gross cash position was £10.3m with gross debt increasing by £3m to £14.9m and overall net debt 

increasing from a net cash position of £2.9m in 2013 to a net debt position of £4.6m.

Shareholders’ Funds

There are 100,000,000 ordinary shares of 10p each with a resulting share premium of £0.8m. There were no new funds raised during the year; 

therefore the share capital and share premium account remain at £10.8m consistent with the prior year. All ordinary shares rank pari passu for 

both voting and dividend rights.  

Pension Schemes

The  Group  does  not  operate  any  deﬁ ned  beneﬁ t  pension  schemes  and  has  no  liability  arising  from  any  such  scheme.  The  Group  made 

contributions amounting to £0.33m (2013: £0.15m) to deﬁ ned contributions schemes for certain employees. The Group’s staging date for Pensions 

Auto-Enrolment was October 2013 and this has increased the Group’s pension costs for the 2014 ﬁ nancial year by £0.18m.

Financial Instruments

The Group does not have any contractual obligation under any ﬁ nancial instruments with respect to the hedging of interest rate risk.

Dividends

The Board is pleased to announce that it will make a ﬁ nal dividend payment in respect of the ﬁ nancial year to 31 August 2014 of 0.5p per share in 

addition to the interim dividend of 0.1p per share paid in May 2014. If approved by the shareholders at the Annual General Meeting to be held 

on 15 January 2015, the dividend will be payable on 22 January 2015 to those shareholders registered on 30 December 2014. The Board aims to 

maintain a dividend policy that grows with the Group’s earnings but intends to ensure that the payment of dividend does not detract from its 

primary strategy to continue to buy-and-build and grow the Group.   

James Mullins
Finance Director

15

Strategic report

Enhanced Business Review

All details required are covered in the Chairman’s Statement and the Operating and Financial Review between pages 4 and 15 .  

Cambria Business Philosophy

Cambria’s culture – The Four Pillars

The Group works hard to instil a group culture. This culture is built around four pillars which are:

Pillar One - Associate delight

The Directors believe that Associates are the Company’s most important asset and therefore members of the team are not referred to as members 

of staﬀ  or employees, but rather as “Associates”. The Directors want all Associates to be proud to be associated with the Group and to be given 

the autonomy to make decisions that aﬀ ect the running of “their” business. The Directors promote internal development and foster a culture 

whereby associates feel they can achieve their career aspirations with Cambria. Equally, Cambria invests in its Associates in order for them to 

achieve their full potential within the Group. 

Pillar Two - Guest delight

Cambria Associates are encouraged to treat all customers at all times, in the way that they would treat a guest visiting their own home.  The 

Directors believe that associate empowerment is key to achieving this goal and the Directors believe that the organisation must be transparent 

and open at all times generating empathy with the diverse guest base of the Group.

Pillar Three - Brand delight

The Group’s goal is to become the retailer of choice for all of the automotive manufacturers that it represents.  This pillar focuses on achieving 

the following goals:

•  brand vehicle sales objectives

•  brand part sales objectives

•  top half placing in brand customer satisfaction surveys

•  the development of a trusting relationship with brand personnel from the manufacturer partners

Pillar Four - Stakeholder delight

The Group aims to provide satisfaction to its Stakeholders. It seeks to achieve this through:

•   disclosing timely and accurate information providing Stakeholders with a detailed  understanding of business performance; and

•  communicating openly and transparently

Primary Risks

The primary risk to the Group is the volatility in the new and used car markets and the changes made by our manufacturer brand partners to the 

pricing and margin structure on the new vehicles that we sell.  Through implementing tight controls and building a strong operational Group 

infrastructure, the Directors believe they are taking all possible steps to protect the business.

The Group also has exposure to movements in interest rate due to the variable nature of the term loans.

By order of the board

James Mullins
Director

16

Dorcan Way, Swindon, SN3 3RA

24 November 2014

Directors’ report

The directors present their directors’ report and ﬁ nancial statements for the year ended 31 August 2014. 

Principal Activities

Cambria’s principal activities are the sale and servicing of motor vehicles and the provision of ancillary services. The Group operates from 28 

sites with a total of 45 dealer franchises.   

Proposed Dividend

The directors recommend the payment of a ﬁ nal dividend for 2014 of 0.5p per share which equates to £0.5m (2013: £0.4m).  If approved at the 

Annual General Meeting to be held on 15 January 2015, the dividend will be payable on 22 January 2015 to those shareholders registered on 30 

December 2014.

Directors 

The directors who held oﬃ  ce during the year were as follows:

P H Swatman

M J J Lavery 

M W Burt 

J A Mullins

Sir P A Burt

All directors beneﬁ ted from qualifying third party indemnity provisions in place during the ﬁ nancial period. 

Associates

The Group recognises the beneﬁ t of keeping associates informed of group aﬀ airs and the views of associates are given full consideration at 

regular meetings with their representatives.

Full and  fair consideration  is given  to  the employment of disabled persons, who are  treated  no diﬀ erently  from other associates as regards 

recruiting, training, career development and promotion opportunities.  For people who may become disabled, in the course of employment, the 

Group will make every eﬀ ort to accommodate them in suitable alternative employment.  

Political and Charitable Contributions

During the year, the Company made A £10,000 charitable donation to support BEN, the Motor And Allied Trades Benevolent Fund.  The Group 

and its Associates also support BEN through a payroll giving scheme.  

Neither the Company nor any of its subsidiaries made any political donations or incurred any political expenditure during the year (2013: £nil).

Disclosure of Information to Auditor 

The directors who held oﬃ  ce at the date of approval of this directors’ report conﬁ rm that, so far as they are each aware, there is no relevant audit 

information of which the Company’s auditor is unaware; and each director has taken all the 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 that information.  

Auditor

In accordance with Section 489 of the Companies Act 2006, a resolution for the re-appointment of KPMG LLP as auditor of the Company is to 

be proposed at the forthcoming Annual General Meeting. 

By order of the board

James Mullins
Director

Dorcan Way, Swindon, SN3 3RA

24 November 2014

17

Statement of directors’ responsibilities in respect of the Directors’ Report 
and the ﬁ nancial statements              

The directors are responsible for preparing the Directors’ Report and the group and parent company ﬁ nancial statements in accordance with 

applicable law and regulations.  

Company law requires the directors to prepare ﬁ nancial statements for each ﬁ nancial year.  As required by the AIM rules of the London Stock 

Exchange they are required to prepare the group ﬁ nancial statements in accordance with IFRSs as adopted by the EU and applicable law and 

have elected to prepare the parent company ﬁ nancial statements in accordance with UK Accounting Standards and applicable law (UK Generally 

Accepted Accounting Practice). 

Under company law the directors must not approve the ﬁ nancial statements unless they give a true and fair view of the state of aﬀ airs of the 

group and parent company and of their proﬁ t or loss for that period.

In preparing each of the group and parent company ﬁ nancial statements, the directors are required to:  

•   select suitable accounting policies and then apply them consistently;  

•  make judgments and estimates that are reasonable and prudent;  

•  for the group ﬁ nancial statements, state whether they have been prepared in accordance with IFRSs as adopted by the EU

•  for the parent company ﬁ nancial statements state whether applicable UK Accounting Standards have been followed, subject to any material 

departures disclosed and explained in the parent company ﬁ nancial statements;  

•  prepare the ﬁ nancial statements on the going concern basis unless it is inappropriate to presume that the group and parent company will 

continue in business.  

The directors are responsible for keeping adequate accounting records that are suﬃ  cient to show and explain the parent company’s transactions 

and disclose with reasonable accuracy at any time the ﬁ nancial position of the parent company and enable them to ensure that its ﬁ nancial 

statements comply with the Companies Act 2006.  They have general responsibility for taking such steps as are reasonably open to them to 

safeguard the assets of the group and to prevent and detect fraud and other irregularities. 

The directors are responsible for the maintenance and integrity of the corporate and ﬁ nancial information included on the company’s website.  

Legislation in the UK governing the preparation and dissemination of the ﬁ nancial statements may diﬀ er from legislation in other jurisdictions.

18

KPMG LLP

Independent auditor’s report to the members of Cambria Automobiles plc

We have audited the ﬁ nancial statements of Cambria Automobiles plc for the year ended 31 August 2014 which comprise the Group Statement 
of Financial Position and Parent Company Balance Sheet, the Group Statement of Comprehensive Income, the Group Statement of Changes in 
Equity, the Group Statement of Cash Flow, the Parent Company Reconciliation of Movements in Shareholders’ Funds and the related notes. The 
ﬁ nancial reporting framework that has been applied in the preparation of the group ﬁ nancial statements is applicable law and International 
Financial Reporting Standards (IFRS) as adopted by the EU.  The ﬁ nancial reporting framework that has been applied in the preparation of the 
parent company ﬁ nancial statements is applicable law and UK Accounting Standards (UK Generally Accepted Accounting Practice).
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit 
work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report 
and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company 
and the Company’s members, as a body, for our audit work, for this report, or for the opinions we have formed.

Respective responsibilities of directors and auditor

As explained more fully in the Directors’ Responsibilities Statement set out on page 18, the directors are responsible for the preparation of the 
ﬁ nancial statements and for being satisﬁ ed that they give a true and fair view. Our responsibility is to audit, and express an opinion on, the 
ﬁ nancial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us 
to comply with the Auditing Practices Board’s Ethical Standards for Auditors.

Scope of the audit of the ﬁ nancial statements

A description of  the  scope of an audit of  ﬁ nancial  statements  is  provided on  the  Financial  Reporting  Council’s website at www.frc.org.uk/
auditscopeukprivate  

Opinion on ﬁ nancial statements

In our opinion:
•   the ﬁ nancial statements give a true and fair view of the state of the group’s and of the parent company’s aﬀ airs as at 31 August 2014 and of the 

group’s proﬁ t for the year then ended;

•   the group ﬁ nancial statements have been properly prepared in accordance with IFRSs as adopted by the EU;
•  the parent company ﬁ nancial statements have been properly prepared in accordance with UK Generally Accepted Accounting Practice;
•  the ﬁ nancial statements have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other matter prescribed by the Companies Act 2006

In our opinion the information given in the Operating and ﬁ nancial review, Chairman’s statement, Strategic report and Directors’ report for the 
ﬁ nancial year for which the ﬁ nancial statements are prepared is consistent with the ﬁ nancial statements.  

Matters on which we are required to report by exception

We have nothing to report in respect of the following.  Under the Companies Act 2006 we are required 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 frombranches 

not visited by us; or

•   the parent company ﬁ nancial statements are not in agreement with the accounting records and returns; or
•   certain disclosures of directors’ remuneration speciﬁ ed by law are not made; or
•   we have not received all the information and explanations we require for our audit.

Ian Brokenshire (Senior Statutory Auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
Plym House 
3 Longbridge Road 
Plymouth
PL6 8LT

24 November 2014

19

Consolidated statement of comprehensive income
for year ended 31 August 2014

Revenue

Cost of sales

Gross Proﬁ t

Administrative expenses

Results from operating activities

Finance income

Finance expenses

Net ﬁ nance expenses

Proﬁ t before tax from operations before non-recurring expenses, 
and acquisitions

Trading (loss)/proﬁ t from branch acquired in year

Non-recurring expenses

Proﬁ t before tax

Taxation

Proﬁ t and total comprehensive income for the period

Note

3

4

4

9

9

5  

4

10  

2014

£000

450,148

2013 

£000

395,776

(394,930)

(344,550)

55,218

51,226

(49,415)

(46,680)

5,803

4,546

72  

(564)

(492)

5,412

(20)

5,392  

(81)

5,311

(1,158)

4,153

60

(580)

(520)

4,111

17

4,128

(102)

4,026

(534)

3,492

3.49p

Basic and diluted earnings per share

8  

4.15p  

All comprehensive income is attributable to owners of the parent company

20

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated statement of changes in equity
for year ended 31 August 2014

Note

Share capital Share premium Retained earnings

Total equity

£000

£000

£000

£000

Balance at 31August 2012

10,000

799

10,742

21,541

Proﬁ t for the year

Dividend paid

-

-

-

-

3,492

(400)

3,492

(400)

Balance at 31 August 2013

10,000

799

13,834

24,633

Proﬁ t for the year

Dividend paid

21

-

-

-

-

4,153

(500)

4,153

(500)

Balance at 31 August 2014

10,000

799

17,487

28,286

21

Consolidated statement of ﬁ nancial position
at 31 August 2014

Non-current assets

Property, plant and equipment

Intangible assets

Deferred tax asset

Current assets

Inventories

Trade and other receivables

Cash and cash equivalents

Total assets

Current liabilities

Other interest-bearing loans and borrowings  

Trade and other payables

Taxation

Provisions

Non-current liabilities

Other interest-bearing loans and borrowings

Provisions

Other payables

Total liabilities

Net assets

Equity attributable to equity holders of the parent  

Share capital

Share premium

Retained earnings

Total equity 

Note

11

12

13

14

15

16

17

18

20

17

20

13

21

2014

£000

38,571

5,370

463

2013  

£000

28,353

356

618

44,404

29,327

77,100

10,358

10,251

66,248

8,038

14,754

97,709

89,040

142,113

118,367

(2,020)

(97,972)

(785)

(11)

(1,550)

(81,126)

(251)

(41)

(100,788)

(82,968)

(12,875)

(10,317)

-

(164)

(10)

(439)

(13,039)

(10,766)

(113,827)

(93,734)

28,286

24,633

10,000

799

17,487

10,000

799

13,834

28,286

24,633

These ﬁ nancial statements were approved by the board of directors on 24 November 2014 and were signed on its behalf by:

Mark Lavery
Director

22

Company registered number: 05754547

Consolidated cash ﬂ ow statement
for year ended 31 August 2014

Notes

Cash ﬂ ows from operating activities

Proﬁ t for the year

Adjustments for:

Depreciation, amortisation and impairment

11/12

Financial income

Financial expense

Loss on sale of property, plant and equipment

Taxation

Non recurring expenses

Change in trade and other receivables

Change in inventories

Change in trade and other payables

Change in provisions

Interest paid

Tax paid

Non recurring expenses 

Net cash from operating activities

Cash ﬂ ows from investing activities

Interest received

Acquisition of branch net of cash acquired

Acquisition of land and property with branch acquired

Purchase of property, plant and equipment and software

Net cash from investing activities

Cash ﬂ ows from ﬁ nancing activities

Proceeds from new loan

Interest paid

Repayment of borrowings

Dividend paid

Net cash from ﬁ nancing activities

Net (decrease)/increase in cash and cash equivalents

Cash and cash equivalents at 1 September

Cash and cash equivalents at 31 August

9

9

10

5

5

2

16

16

2014  

£000

4,153

1,542

(72)

564

-

1,158

81

7,426

(2,275)

(9,071)

16,096

(40)

12,136

(246)

(559)

(81)

11,250

72

(6,721)

(3,750)

(7,564)

(17,963)

4,700

(318)

(1,672)

(500)

2,210

(4,503)

14,754

10,251

2013 

£000

3,492

1,429

(60)

580

1

534

102

6,078

(915)

(8,806)

13,215

(44)

9,528

(287)

(735)

(102)

8,404

60

(1,209)

(3,017)

(789)

(4,955)

1,980

(293)

(1,485)

(400)

(198)

3,251

11,503

14,754

23

 
           
 
           
Notes
(forming part of the ﬁ nancial statements)

1  Accounting policies

Cambria Automobiles plc is a company which is quoted on the AIM Market of the London Stock Exchange plc and is incorporated and domiciled 

in the United Kingdom.  The address of the registered oﬃ  ce is Swindon Motor Park, Dorcan Way, Swindon, SN3 3RA.  The registered number 

of the Company is 05754547. 

These ﬁ nancial statements as at 31 August 2014 consolidate those of the Company and its subsidiaries (together referred to as the “Group”).  The 

parent company ﬁ nancial statements present information about the Company as a separate entity and not about its group. 

The  Group  ﬁ nancial  statements  have  been  prepared  and  approved  by  the  directors  in  accordance  with  International  Financial  Reporting 

Standards as adopted by the EU (“Adopted IFRS”).  The Company has elected to prepare its parent company ﬁ nancial statements in accordance 

with UK GAAP; and these are presented on pages 54 to 63.

The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in the ﬁ nancial statements. 

Judgements made by the directors in the application of these accounting policies that have signiﬁ cant eﬀ ect on the ﬁ nancial statements and 

estimates with a signiﬁ cant risk of material adjustment in the next year are discussed at the end of this note.

Basis of preparation

The ﬁ nancial statements are prepared under the historical cost convention.

The directors believe that the Group is well placed to manage its business risks successfully despite the current uncertain economic outlook.

The directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable 

future. Thus they continue to adopt the going concern basis in preparing the annual ﬁ nancial statements.

Further information regarding the Company’s business activities together with the factors likely to aﬀ ect its future development, performance 

and position is set out in the Strategic report and Directors’ report on pages 16 to 17.

Basis of consolidation

The ﬁ nancial statements consolidate the ﬁ nancial statements of the Company together with its subsidiary companies.

Subsidiaries

Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or indirectly, to govern the ﬁ nancial 

and operating policies of an entity so as to obtain beneﬁ ts from its activities. In assessing control, potential voting rights that are currently 

exercisable or convertible are taken into account. The ﬁ nancial information of subsidiaries is included from the date that control commences 

until the date that control ceases. 

All business combinations are accounted for by applying the purchase method. The cost of an acquisition is measured as the fair value of the 

assets acquired, equity instruments issued and liabilities incurred or assumed at the date of exchange.  Identiﬁ able assets acquired and liabilities 

and contingent liabilities assumed in a business combination are initially measured at fair value at the acquisition date irrespective of the extent 

of any minority interest. Any contingent consideration payable is recognised at fair value at the acquisition date. Subsequent changes to the fair 

value of the contingent consideration are recognised in proﬁ t or loss.

The excess of the cost of an acquisition over the fair values of the Group’s share of identiﬁ able assets and liabilities acquired is recognised as 

goodwill.  If the fair value of identiﬁ able assets and liabilities acquired (i.e. discount on acquisition) exceeds the cost of the business combination, 

the diﬀ erence is recognised directly in proﬁ t or loss.  

Inter-company transactions, balances and unrealised gains and losses on transactions between Group companies are eliminated on consolidation.

24

Notes (continued)
(forming part of the ﬁ nancial statements)

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, who is responsible for allocating resources and assessing performance of the operating segments, has been identiﬁ ed 

as the Chief Executive Oﬃ  cer.

All revenue generated and non-current assets held are attributable to UK operations only. 

Revenue recognition

Revenue  is  measured at the  fair value of the consideration received or receivable and represents amounts receivable  for goods and services 

provided in the normal course of business, net of discounts and VAT.

Sales of motor vehicles, parts and accessories are recognised when the signiﬁ cant risks and rewards of ownership have been transferred to the 

buyer.  In general this occurs when vehicles or parts are delivered to the customer and title has passed.  Manufacturer incentives are recognised 

as revenue when earned.  Servicing and bodyshop sales, including warranty work, are recognised on completion of the agreed work.  Finance 

commission revenue is recognised as the related vehicles are sold. 

Deposits received from customers

Deposits received from customers prior to the completion of a sale (delivery of vehicle) are included in the accounts as creditors falling due 

within one year.

Financing income and expenses

Financing expenses comprise interest payable, stocking interest charge on consignment and used vehicles and ﬁ nance leases.  Financing income 

comprises interest receivable on funds invested and interest credits received from manufacturers on stock management.

Borrowing costs are recognised in the period in which they are incurred.

Interest income and interest payable is recognised in proﬁ t or loss as it accrues, using the eﬀ ective interest method. 

Operating proﬁ t

Operating proﬁ t relates to proﬁ t before ﬁ nance income, ﬁ nance expense and income tax expense.

25

 
Notes (continued)
(forming part of the ﬁ nancial statements)

1  Accounting policies (continued)

Intangible assets

Goodwill

Goodwill  represents  the excess  between  the cost of an acquisition of a  subsidiary compared  to  the  net  fair value of  the  identiﬁ able assets, 

liabilities and contingent liabilities, and recognition of identiﬁ able intangibles at the date of acquisition. Identiﬁ able intangibles are those which 

can be sold separately or which arise from legal rights regardless of whether those rights are separable. 

Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash-generating units of the acquiree which represent 

the smallest identiﬁ able group of assets that generates cash inﬂ ows that are largely independent of the cash inﬂ ows from other assets or groups 

of assets.  Goodwill  is  not amortised  but  is tested annually  for  impairment. Any  impairment  is recognised  immediately  in the statement of 

comprehensive income and is not subsequently reversed.

Other intangible assets

Expenditure on internally generated goodwill and brands is recognised as an expense as incurred.

Other intangible assets that are acquired by the Group are stated at cost less accumulated amortisation and accumulated impairment losses.

Amortisation 
Amortisation is charged on a straight-line basis over the estimated useful lives of intangible assets unless such lives are indeﬁ nite. Intangible 

assets with an indeﬁ nite useful life and goodwill are systematically tested for impairment at each year. Other intangible assets are amortised 

from the date they are available for use. The estimated useful lives are as follows:

Computer software 

3 – 5 years 

Property, plant and equipment

Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.

Where parts of an item of property, plant and equipment have diﬀ erent useful lives, they are accounted for as separate items of property, plant 

and equipment.

Depreciation is charged on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. Land is 

not depreciated. The estimated useful lives are as follows:

•  freehold buildings 

•  leasehold properties 

•  plant and machinery 

•  ﬁ xtures and ﬁ ttings 

•  computer equipment 

50 years

over the lifetime of the lease

5 to 10 years

5 to 10 years

3 to 5 years

Depreciation methods, useful lives, residual values and possible impairments have been reviewed at the year end. As a result of this review, no 

impairment charge has been deemed necessary for the period.

26

 
 
 
 
 
Notes (continued)
(forming part of the ﬁ nancial statements)

Impairment of assets excluding inventories

The carrying amounts of the Group’s assets, are reviewed at each year end to determine whether there is any indication of impairment; an asset 

is considered to be impaired if objective evidence indicates that one or more events have had a negative eﬀ ect on the estimated future cash ﬂ ows 

of that asset. If any such indication exists, the asset’s recoverable amount is estimated. 

For goodwill, assets that have an indeﬁ nite useful life and intangible assets that are not yet available for use, the recoverable amount is estimated 

at each year end.

An  impairment  loss  is  recognised  whenever  the  carrying  amount  of  an  asset  or  its  cash-generating  unit  exceeds  its  recoverable  amount. 

Impairment losses are recognised in income.

Impairment losses recognised in respect of cash-generating units are allocated ﬁ rst to reduce the carrying amount of any goodwill allocated to 

cash-generating units and then to reduce the carrying amount of the other assets in the unit on a pro rata basis.  A cash generating unit is the 

smallest identiﬁ able group of assets that generates cash inﬂ ows that are largely independent of the cash inﬂ ows from other assets or groups of 

assets.

For an asset that does not generate largely independent cash inﬂ ows, the recoverable amount is determined for the cash-generating unit to 

which the asset belongs.

Reversals of impairment

An impairment loss in respect of trade and other receivables carried at amortised cost is reversed if the subsequent increase in recoverable 

amount can be related objectively to an event occurring after the impairment loss was recognised.

An impairment loss in respect of goodwill is not reversed. 

An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been 

determined, net of depreciation or amortisation, if no impairment loss had been recognised.

Inventories

Inventories are stated at the lower of cost and net realisable value. In determining the cost of motor vehicles, the actual amount paid and payable 

to date for each vehicle is used, for spare parts and service items cost is based on the ﬁ rst-in ﬁ rst-out principle.  An appropriate provision is made 

for obsolete or slow moving items.

New vehicles on consignment from manufacturers are included in the Statement of Financial Position with a corresponding liability in creditors 

due within one year. This stock is considered to be under the control of the Group as it is considered that the Group bears all the risks and 

rewards or ownership, even though legal title has not yet passed.

Consignment  stock  is  held  for  a  maximum  period  (which  varies  between  manufacturers)  before  becoming  due  for  payment.  Part  of  the 

consignment  period  is  interest  free  and  the  remaining  periods  are  interest  bearing  (periods  and  charges  vary  between  manufacturers  but 

interest is generally linked to LIBOR). 

Used motor vehicles are stated at the lower of cost or net realisable value, by reference to Glass’s Guide or CAP data. 

Demonstrator vehicles are held within inventories at the lower of cost and net realisable value.

Vehicle funding and stocking loans form part of the Group’s working capital and are recognised at the fair value of the amount due to the facility 

provider.

27

Notes (continued)
(forming part of the ﬁ nancial statements)

1  Accounting policies (continued)

Financial Instruments

Classiﬁ cation of ﬁ nancial instruments issued by the Group

Financial instruments issued by the Group are treated as equity only to the extent that they meet the following two conditions: 

a)   they include no contractual obligations upon the group to deliver cash or other ﬁ nancial assets or to exchange ﬁ nancial assets or ﬁ nancial 

liabilities with another party under conditions that are potentially unfavourable to the group; and 

b)  where the instrument will or may be settled in the Company’s own equity instruments, it is either a non-derivative that includes no obligation 

to deliver a variable number of the Company’s own equity instruments or is a derivative that will be settled by the Company’s exchanging a 

ﬁ xed amount of cash or other ﬁ nancial assets for a ﬁ xed number of its own equity instruments.

To the extent that this deﬁ nition is not met, the proceeds of issue are classiﬁ ed as a ﬁ nancial liability.  Where the instrument so classiﬁ ed takes 

the legal form of the Company’s own shares, the amounts presented in the historical ﬁ nancial information  for called up share capital and share 

premium account exclude amounts in relation to those shares.  

Non-derivative ﬁ nancial instruments

Non-derivative ﬁ nancial instruments comprise, trade and other receivables, cash and cash equivalents, loans and borrowings, and trade and 

other payables.

Trade and other receivables

Trade and other receivables are recognised initially at fair value.  Subsequent to initial recognition they are measured at amortised cost using the 

eﬀ ective interest method, less any impairment losses.

Trade and other payables

Trade and other payables are recognised initially at fair value.  Subsequent to initial recognition they are measured at amortised cost using the 

eﬀ ective interest method.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and form an integral part 

of the Group’s cash management are included as a component of cash and cash equivalents for the purpose only of the cash ﬂ ow statement.

Interest-bearing borrowings

Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-

bearing borrowings are stated at amortised cost using the eﬀ ective interest method.

28

Notes (continued)
(forming part of the ﬁ nancial statements)

1  Accounting policies (continued)

Taxation

Tax on the proﬁ t or loss for the year comprises current and deferred tax. Tax is recognised except to the extent that it relates to items recognised 

in other comprehensive income, in which case it is recognised in other comprehensive income.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance sheet 

date, and any adjustment to tax payable in respect of previous years.

Deferred tax is provided on temporary diﬀ erences between the carrying amounts of assets and liabilities for ﬁ nancial reporting purposes and 

the  amounts  used  for  taxation  purposes.  The  following  temporary  diﬀ erences  are  not  provided  for:  the  initial  recognition  of  goodwill;  the 

initial recognition of assets or liabilities that aﬀ ect neither accounting nor taxable proﬁ t other than in a business combination, and diﬀ erences 

relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax 

provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or 

substantively enacted at the balance sheet date.

A deferred tax asset is recognised only to the extent that it is probable that future taxable proﬁ ts will be available against which the temporary 

diﬀ erence can be utilised. 

Employee beneﬁ ts

Deﬁ ned contribution plans

A deﬁ ned contribution plan is a post-employment beneﬁ t plan under which the Company pays ﬁ xed contributions into a separate entity and 

will have no legal or constructive obligation to pay further amounts. Obligations for contributions to deﬁ ned contribution pension plans are 

recognised as an expense as incurred.

Leasing

Leases in which the Group assumes substantially all the risks and rewards of ownership of the leased asset are classiﬁ ed as ﬁ nance leases.  Where 

land and buildings are held under leases the accounting treatment of the land is considered separately from that of the buildings.  Leased 

assets acquired by way of ﬁ nance lease are stated at an amount equal to the lower of their fair value and the present value of the minimum lease 

payments at inception of the lease, less accumulated depreciation and less accumulated impairment losses.  Lease payments are accounted for 

as described below.

Operating lease payments

Payments made under operating leases are recognised in the statement of comprehensive income on a straight-line basis over the term of the 

lease. Lease incentives received are recognised as an integral part of the total lease expense. 

Finance lease payments

Minimum lease payments are apportioned between the ﬁ nance charge and the reduction of the outstanding liability. The ﬁ nance charge is 

allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Provisions

A provision is recognised in the Statement of Financial Position when the Group has a present legal or constructive obligation as a result of a past 

event, that can be reliably measured and it is probable that an outﬂ ow of economic beneﬁ ts will be required to settle the obligation.  

29

Notes (continued)
(forming part of the ﬁ nancial statements)

1  Accounting policies  (continued)

IFRS not yet applied

A number of new standards, amendments to standards and interpretations are eﬀ ective for annual periods beginning after 1 January 2014, and 

have not been applied in preparing these consolidated ﬁ nancial statements.  Those which may be relevant to the Group are set out below.  The 

Group does not plan to adopt these standards early and their adoption is not expected to have a material eﬀ ect on the ﬁ nancial statements unless 

otherwise indicated:

• 

 IFRS  10  Consolidated  Financial  Statements    –  IFRS  10  supersedes  IAS  27  Consolidated  and  Separate  Financial  Statements  and  SIC-12 
Consolidation - Special Purpose Entities. It provides a single model to be applied in the control analysis for all investees, including entities that 
currently are SPEs in the scope of SIC-12. An investor controls an investee when:

- 

- 

- 

it is exposed or has rights to variable returns from its involvement with that investee;

it has the ability to aﬀ ect those returns through its power over that investee; and 

there is a link between power and returns.

• 

 IFRS 12 Disclosure of Interests in Other Entities  – Contains the disclosure requirements for entities that have interests in subsidiaries, 
joint arrangements (i.e. joint operations or joint ventures), associates and/or unconsolidated structured entities.  

•   IAS 32 Oﬀ  setting Financial Assets and Financial Liabilities  – The amendments clarify the oﬀ setting criteria, speciﬁ cally:

- 

 when an entity currently has a legal right of set oﬀ ; and 

-  when gross settlement is equivalent to net settlement.

• 

 IAS 36 Impairment of Assets   – The amendments reverse the unintended requirement in IFRS 13 Fair Value Measurement to disclose the 
recoverable amount of  every cash-generating  unit  to which signiﬁ cant goodwill or  indeﬁ nite-lived  intangible assets  have  been allocated. 
Under the amendments, recoverable amount is required to be disclosed only when an impairment loss has been recognised or reversed.

Critical accounting judgements in applying the Group’s accounting policies

Estimates and judgements are continually evaluated and are based on historical experience and other factors including expectations of future 

events that are believed to be reasonable under the circumstances.  

Certain critical accounting judgements in applying the Group’s accounting policies are described below:

Goodwill and property portfolio impairment

The carrying values of goodwill and property are tested annually for  impairment, for goodwill  by using cash ﬂ ow projections for each cash 

generating unit, and for property by comparing the carrying value to the higher of value in use or market value.

Intangible assets

On the acquisition of Grange Motors (Swindon) Limited in the period ended 31 August 2007, a third party valuation has been carried out on the 

intangible assets that are pertinent to the motor business.  This included consideration of franchise rights, brand, and other intangible assets.  

The directors apply the principles of the external valuation of the intangibles on the Swindon acquisition to subsequent acquisitions and have 

concluded that intangibles arising on subsequent acquisitions are immaterial or have not arisen.

Consignment inventories

Consignment vehicles are regarded as being eﬀ ectively under the control of the Group and are included within inventories in the Statement of 

Financial Position as the Group has the signiﬁ cant risks and rewards of ownership even though legal title has not yet passed, if the vehicles are 

not sold in the consignment period the group has the obligation to purchase. The corresponding liability is included in trade and other payables.

Deferred tax

Deferred tax assets and liabilities require management judgement in determining the amounts to be recognised.  In particular judgement is used 

when assessing the extent to which deferred tax assets should be recognised with consideration given to the timing and level of future taxable 

income. 

Non-recurring expenses

Non-recurring expenses are items which derive from events or transactions that are outside the normal course of business, and do not directly 

relate to the on-going operations, therefore have been separately disclosed in order for the ﬁ nancial statements to present a true and fair view. 

30

Notes (continued)
(forming part of the ﬁ nancial statements)

2  Acquisitions of trading branches

Eﬀ  ect of acquisition in 2014

On 7 July 2014, the Company completed the acquisition of the Jaguar and Land Rover dealership in Barnet from Lookers PLC.

Acquiree’s net assets at the acquisition date:

Freehold land and buildings

Plant and equipment

Stocks

Trade and other creditors

Prepayments

Net and identiﬁ able assets and liabilities

Goodwill on acquisition (The goodwill arising on acquisition is attributable to expanding our geographical base 
for Jaguar, adding the Land Rover brand to our business, and the anticipated proﬁ tability from the sale of 
vehicles from the Barnet dealership)

Recognised values on 
acquisition and Fair 
Value

£000

3,750 

461

1,781

(566)

45

5,471

5,000

Consideration paid (note that transaction and set up costs of £81k were written off to administrative expenses 
in 2014), satisﬁ ed in cash

10,471

It is estimated that in the year before acquisition, the business generated £46m of revenue and a pre-tax proﬁ t 
of £0.7m.  The results attributable to the branch acquired during the ﬁ nancial year and included in the group 
results were as follows:

Turnover 

Loss before tax

2014

£000

4,755

(20)

31

  
Notes (continued)
(forming part of the ﬁ nancial statements)

2  Acquisitions and disposals of trading branches

Eﬀ  ect of acquisition in 2013 

On 31 January 2013, the Group acquired the trade and assets of the Vauxhall, Alfa Romeo, Chrysler and Jeep dealership in Chelmsford from 

County Holdings (Chelmsford) Limited and its subsidiary companies.

Recognised values on 
acquisition and Fair Value

Acquiree’s net assets at the acquisition date:

Freehold land & buildings

Plant and equipment

Stocks

Trade and other creditors

Net and identiﬁ able assets and liabilities

Goodwill on acquisition

Consideration paid (note that transaction costs of £67k were written off to administrative expenses in 
2013), satisﬁ ed in cash

The results attributable to the branch acquired during the 2013 ﬁ nancial year were as follows:

Turnover 

Proﬁ t before tax

£000

3,017

191

1,100

(82)

4,226

-

  4,226

2013  

£000

11,670

17

32

Notes (continued)
(forming part of the ﬁ nancial statements)

3 Revenue

Sale of goods 

Aftersales services

Total revenues 

4  Segmental reporting

2014   

£000

404,129

46,019

2013  

£000

348,601

47,175

450,148

395,776

The Group has adopted IFRS 8 ‘Operating Segments’ which determines and presents operating segments based on information presented to 

the Group’s Chief Operating Decision Maker (“CODM”), the Chief Executive Oﬃ  cer. The Group is operated and managed on a Dealership by 

Dealership basis.  The CODM receives information both on a dealership basis and by revenue stream (New, Used, Aftersales). Given the number 

of dealerships, it was deemed most appropriate to present the information by revenue stream for the purposes of segmental analysis.

2014
Revenue

2014
Revenue 
mix

2014
Gross 
Proﬁ t

2014
Margin

2013
Revenue

2013
Revenue 
mix

2013
Gross 
Proﬁ t

2013
Margin

£m

195.2

208.9

55.8

(9.8)

%

43.4

46.4

12.4

(2.2)

£m

12.3

19.0

23.9

-

%

6.3

9.1

42.9

-

£m

159.8

188.8

56.6

(9.4)

%

40.4

47.7

14.3

(2.4)

£m

10.6

17.5

23.1

-

%

6.7

9.3

40.8

-

450.1

100.0

55.2

12.3

395.8

100.0

51.2

12.9

New Car

Used Car

Aftersales

Internal sales

Total

Administrative expenses

Operating proﬁ t before non-recurring  
expenses

Non-recurring expenses

(49.3)

5.9

(0.1)

(46.6)

4.6

(0.1)

Operating proﬁ t

5.8

1.3

4.5

1.1

The CODM reviews the performance of the business in terms of both net proﬁ t before tax and EBITDA, as such the following table shows a 

reconciliation of the Proﬁ t before tax to EBITDA..

33

                   
       
   
     
     
 
 
      
      
Notes (continued)
(forming part of the ﬁ nancial statements)

4  Segmental reporting (continued)

Proﬁ t Before Tax

Non-recurring expenses (note 5))

Underlying Proﬁ t Before Tax

Net ﬁ nance expense

Depreciation and amortisation

Underlying EBITDA

Non-recurring expenses

EBITDA

Revenue and non-current assets are attributable to United Kingdom operations only.

5  Non-recurring expenses  

Transaction and new franchising costs                                                                                                   

Cost rationalisation programme                                                                                                                               

6  Expenses and auditors’ remuneration

The result from operating activities is stated after (crediting)/charging the following:

Impairment (gain)/loss recognised on other trade receivables and prepayments (note 
22(b))

Auditor’s remuneration:

Audit of these ﬁ nancial statements

Audit of ﬁ nancial statements of subsidiaries pursuant to legislation

Other services relating to taxation

All other services

2014

£000

5,311

81

5,392

492

1,542

7,426

(81)

7,345

2014

£000

81

-

81

2014    

£000

(11)

2014  

£000

25

91

29

7

2013

£000

4,026

102

4,128

520

1,429

6,077

(102)

5,975

2013

£000

67

35

102

2013

£000

126 

2013  

£000

25

91

29

7

The 2014 auditor’s remuneration for statutory audit and other services relates solely to amounts paid to KPMG LLP. The 2013 amounts relate 

solely to amounts paid to KPMG Audit Plc.

34

            
            
            
            
            
            
 
 
                     
Notes (continued)
(forming part of the ﬁ nancial statements)

7  Staff numbers and costs

The average number of persons employed by the group (including directors) during the year, analysed by category, was as follows:

Number of employees

Sales

Service

Parts

Administration

The aggregate payroll costs of these persons were as follows:

Wages and salaries

Social security costs

Expenses related to deﬁ ned contribution plans

2014

343

362

109

210

1,024

2014

£000

28,545

3,128

326

31,999

2013

317

378

109

213

1,017

2013

£000

27,047

2,984

152

30,183

8   Earnings per share

Basic earnings per share are calculated by dividing the earnings attributable to equity shareholders by the number of ordinary shares in issue in 

the year.  There is one class of ordinary share with 100,000,000 shares in issue.     

There are no dilutive share options in issue.

Proﬁ t attributable to shareholders

Non-recurring expenses (Note 5)

Tax on adjustments (at 22.16% (2013:23.58%))

Adjusted proﬁ t attributable to equity shareholders

2014

£000

4,153

81

(18)

4,216

2013

£000

3,492

102

(24)

3,570

Number of shares in issue (‘000)

100,000

100,000

Basic earnings per share

Adjusted earnings per share

4.15p

4.22p

3.49p

3.57p

35

     
     
      
      
   
   
   
   
   
   
Notes (continued)
(forming part of the ﬁ nancial statements)

9  Finance income and expense

Recognised in the income statement

Finance income

Rent deposit interest

Interest receivable  

Total ﬁ nance income

Finance expense

Interest payable on bank borrowings

Consignment and vehicle stocking interest

Total ﬁ nance expense

Total  interest expense on ﬁ nancial liabilities held at amortised cost

Total other interest expense

10  Taxation

Recognised in the income statement

Current tax expense

Current year

Adjustment in respect of prior years

Adjustment in respect of prior years – capital allowances claim

Deferred tax

Utilisation of tax losses paid to previous owner of subsidiary undertaking

Adjustment in respect of prior years

Origination and reversal of temporary differences

Total tax expense

36

2014  

£000

2013  

£000

2

70

72

318

246

564

318

246

564

2014  

£000

1,013

(10)

-

1,003

-

3

152

155

1,158

3

57

60

293

287

580

293

287

580

2013  

£000

854

7

(335)

526

162

(257)

103

8

534

        
        
  
  
            
            
 
           
 
           
 
           
 
           
 
 
 
 
        
        
    
    
     
     
Notes (continued)
(forming part of the ﬁ nancial statements)

10  Taxation (continued)

Reconciliation of total tax

Proﬁ t for the year

Total tax expense

Proﬁ t excluding taxation

Tax using the UK corporation tax rate of 22.16% (2013: 23.58%)

Non-deductible expenses

Accounting deprecation for which no tax relief is due

Utilisation of brought forward losses

Tax payment due to previous owners of subsidiary in relation to utilisation of 
pre-acquisition losses

Change in tax rate

Adjustments in respect of prior years 

Change in deferred tax in respect of property

Total tax expense 

2014  

£000

4,153

1,158

5,311

1,177

44

132

(92)

-

6

(7)

(90)

1,158

2013

£000

3,492

534

4,026

949

35

125

(162)

162

68

(585)

(58)

534

The applicable tax rate for the current year is 22.16% (2013: 23.58%) following the reduction in the main rate of UK corporation tax from 23% to 

21% with eﬀ ect from 1 April 2014.

Reductions in the UK corporation tax rate from 23% to 21% (eﬀ ective from 1 April 2014) and 20% (eﬀ ective from 1 April 2015) were substantively 

enacted on 2 July 2013.  

This will reduce the Company’s future current tax charge accordingly.  The deferred tax asset at 31 August 2014 has been calculated based on the 

rate of 20% substantively enacted at the balance sheet date.

37

        
    
        
    
      
      
      
      
Notes (continued)
(forming part of the ﬁ nancial statements)

11  Property, plant and equipment  

Cost

Balance at 1 September 2012

Additions

Branch acquisitions

Disposals

Balance at 1 September 2013

Additions

Branch acquisitions

Disposals

Transfer

Freehold 
land &
 buildings

Long 
leasehold 
land & 
buildings

Short  
leasehold 
improvements

Plant & 
equipment

Fixtures, 
ﬁ ttings & 
computer 
equipment

Total

£000

£000

£000

£000

£000

£000

20,287

20

3,017

-

23,324

6,514

3,750

-

941

5,058

-

-

-

3,931

421

-

-

5,058

4,352

-

-

-

(941)

104

104

(8)

-

2,709

114

105

(121)

2,807

159

112

(171)

-

6,485

234

86

(239)

38,470

789

3,208

(360)

6,566

42,107

761

245

(482)

-

7,538

4,211

(661)

-

Balance at 31 August 2014

34,529

4,117

4,552

2,907

7,090

53,195

Depreciation  

Balance at 1 September 2012

Charge for the year

Disposals

Balance at 1 September 2013

Depreciation charge for the year

Disposals

Transfer

1,613

300

-

1,913

364

-

213

557

82

-

693

71

-

(213)

3,095

285

-

3,380

287

(8)

-

2,300

207

(120)

2,387

223

(171)

-

5,154

520

(239)

5,435

586

(482)

-

12,719

1,394

(359)

13,754

1,531

(661)

-

Balance at 31 August 2014

2,490

497

3,659

2,439

5,539

14,624

Net book value

At 31 August 2013

21,411

4,419

At 31 August 2014

32,039

3,620

972

893

420

468

1,131

28,353

1,551

38,571

As at 31 August 2014 there are no capital commitments  (2013: £nil) 
The directors have considered the property portfolio for impairment by comparing the carrying amount to the higher of value in use or market 

value and have concluded that no impairment is required.

Security

The title of all freehold and long leasehold properties have been pledged as security to the bank loans disclosed in note 17.

Property, plant and equipment under construction

At 31 August 2014 there were no assets in the course of construction  (2013: £nil).

38

           
 
   
         
   
         
            
            
       
     
            
  
          
            
            
            
   
         
            
            
            
 
            
 
            
 
            
 
            
 
            
 
 
            
 
            
 
            
 
            
 
            
 
            
            
            
            
            
  
          
     
       
  
          
    
        
    
        
            
  
          
            
            
            
Notes (continued)
(forming part of the ﬁ nancial statements)

12  Intangible assets 

Cost

Balance at 1 September 2012

Balance at 1 September 2013

Additions

Balance at 31 August 2014

Amortisation and impairment  

Balance at 1 September 2012

Amortisation

Balance at 1 September 2013

Amortisation for the year

Balance at 31 August 2014

Net book value

At 31 August 2013 and 1 September 2013

At 31 August 2014

Goodwill

Software

£000

£000

Other

£000

346

346

5,000

5,346

-

-

-

-

-

346

5,346

720

720

25

745

675

35

710

11

721

10

24

176

176

-

176

176

-

176

-

176

-

-

Total

£000

1,242

1,242

5,025

6,267

851

35

886

11

897

356

5,370

The undertakings included in the consolidated Group accounts are as follows:

*     Owned directly by Cambria Automobiles Acquisitions Limited

**    Owned directly by Cambria Automobiles Group Limited

***   Owned directly by Cambria Automobiles (South East) Limited

Country of
incorporation

Principal
activity

Subsidiary undertakings

Cambria Automobiles Group Limited

England and Wales

Holding Company

Cambria Automobiles Acquisitions Limited **

England and Wales

Investment Company

Cambria Automobiles Property Limited **

England and Wales

Property Company

Class and 
percentage 
of shares held

100% Ordinary

100% Ordinary

100% Ordinary

Cambria Automobiles (Swindon) Limited *

England and Wales

Motor retailer

100% Ordinary & Preference 

Grange Motors (Swindon) Limited *  

England and Wales

Motor retailer

Thoranmart Limited *

England and Wales

Motor retailer

Cambria Vehicle Services Limited*

England and Wales

Motor retailer

Cambria Automobiles (South East) Limited*

England and Wales

Motor retailer

Grange Motors (Brentwood) Limited***

England and Wales

Motor retailer

100% Ordinary

100% Ordinary

100% Ordinary

100% Ordinary

100% Ordinary

Invicta Motors Limited***

England and Wales

Motor retailer

100% Ordinary & Preference 

Invicta Motors (Maidstone) Limited*

England and Wales

Motor retailer

Deeslease Limited***

Dove Group Limited***

Translease Vehicle Management Limited***

England and Wales

England and Wales

England and Wales

Dormant

Dormant

Dormant

100% Ordinary

100% Ordinary

100% Ordinary

100% Ordinary

39

            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
 
Notes (continued)
(forming part of the ﬁ nancial statements)

12  Intangible assets  (continued)

Amortisation charge

The amortisation charge is recognised in the following line items in the income statement:

Administrative expenses

Impairment loss and subsequent reversal

2014  

£000

11

2013 

£000

35

Goodwill and indeﬁ nite life intangible assets considered signiﬁ cant in comparison to the Group’s total carrying amount of such assets have been 

allocated to cash generating units or groups of cash generating units as follows:

Grange Motors (Swindon) Ltd and Cambria Automobiles (Swindon) Ltd

Thoranmart Ltd

Grange Barnet dealership

Goodwill

2014  

£000

261

85

5,000

5,346

2013  

£000

261

85

346

The recoverable amount of each CGU has been calculated with reference to its value in use.  The calculation for Grange Motors (Swindon), 

Cambria Automobiles (Swindon) and Thoranmart is performed via a review of one year’s EBITDA.

The value in use exceeds the above carrying values for each CGU, therefore no impairment is considered necessary. 

For the  Grange  Barnet dealership the calculation of the value  in use  is performed  by reviewing the  EBITDA over a  longer period.   The  key 

assumptions of this calculation are shown below:

Period on which management approved forecasts are based 

Growth rate applied beyond approved forecast period 

Discount rate (weighted average cost of capital) 

2014      

3 years 
7.1% 
3.5% 

The growth rates used in value in use calculation reﬂ ect the average growth rate in operating proﬁ t experienced by the Group for the overall 

operations over the past 3 years.

40

 
 
 
 
 
 
 
 
 
 
 
 
 
Notes (continued)
(forming part of the ﬁ nancial statements)

13  Deferred tax assets and liabilities 

Recognised deferred tax assets and liabilities 

The amount of temporary diﬀ erences, unused tax losses and tax credits for which a deferred tax asset is recognised is set out below, along with 

the movement in the balance in the year.  The asset would be recovered if oﬀ set against future taxable proﬁ ts of the group.     

Property, plant and equipment

Provisions

Tax value of loss carry-forward

Tax value of pre-acquisition loss carry-forward

1 September 
2013 

Recognised
in income

Net 31 
August 2014

Deferred tax 
liabilities

Deferred tax 
assets

£000

£000

£000

£000

£000

493

5

28

92

618

(62)

-

(1)

(92)

(155)

431

5

27

-

463

(136)

-

-

-

(136)

567

5

27

-

599

The Group has an arrangement with the vendors of Cambria Automobiles (South East) Limited, which was acquired in the year ended 31 August 

2008, under which an amount equal to any tax beneﬁ t received by the Group in relation to tax losses that existed at the date of acquisition 

must be paid to the vendors as additional consideration. At the date of acquisition, the utilisation of tax losses was not probable and therefore 

no deferred tax asset was recognised as part of the acquisition accounting, and the fair value of the liability for contingent consideration was 

immaterial. Subsequent to the acquisition  the utilisation of pre-acquisition losses became probable and, as a result, a deferred tax asset has been 

recognised. A liability for the contingent consideration payable to the vendors has been recognised at its fair value. 

Amount payable to previous owner of subsidiary

Unrecognised deferred tax assets and liabilities  

2014  

£000

164

2013 

£000

439

The deferred tax asset in relation to loss carried forward within a subsidiary has not been recognised due to uncertainty over the future proﬁ tability 

of the subsidiary, these losses are locked in to this particular subsidiary and cannot be utilised in the wider Group.

Tax value of loss carry-forwards

Unrecognised net tax assets

Assets

2014

£000  

657

657

2013

£000

657

657

Reductions in the UK corporation tax rate from 23% to 21% (eﬀ ective from 1 April 2014) and 20% (eﬀ ective from 1 April 2015) were substantively enacted 

on 2 July 2013.  

This will reduce the Company’s future current tax charge accordingly.  The deferred tax asset at 31 August 2014 has been calculated based on the rate of 

20% substantively enacted at the balance sheet date.

41

 
 
 
      
      
      
      
Notes (continued)
(forming part of the ﬁ nancial statements)

14  Inventories

Vehicle consignment stock

Motor vehicles

Parts and other stock

2014  

£000

47,132

27,392

2,576

77,100

2013  

£000

38,287

25,855

2,106

66,248

Included within inventories is £nil (2013: £nil) expected to be recovered in more than 12 months.
Raw materials, consumables and changes in ﬁ nished goods and work in progress recognised as cost of sales in the year amounted to £385 million  
(2013: £340 million).  
Details of stock held as security is given in note 18. 

15  Trade and other receivables

Trade receivables

Prepayments and other receivables

2014 

£000

7,130

3,228

10,358

2013  

£000

5,790

2,248

8,038

Included within trade and other receivables is £nil (2013: £nil) expected to be recovered in more than 12 months.

16  Cash and cash equivalents

Cash and cash equivalents per balance sheet

10,251

14,754

Cash and cash equivalents per cash ﬂ ow statement

10,251

14,754

2014  

£000

2013  

£000

42

 
 
 
 
 
 
 
 
 
 
 
 
Notes (continued)
(forming part of the ﬁ nancial statements)

17  Other interest-bearing loans and borrowings

This  note  provides  information  about  the  contractual  terms  of  the  Group’s  interest-bearing  loans  and  borrowings,  which  are  measured  at 

amortised cost. For more information about the Group’s exposure to interest rate risk, see note 22.

Non-current liabilities

Secured bank loans

Current liabilities

Secured bank loans

Terms and debt repayment schedule   

All debt is in GBP currency

2014

£000

2013

£000

12,875

10,317

2,020

1,550

Nominal interest rate

Year of
Maturity

Face Value and 
Carrying Amount

Face Value and 
Carrying Amount

Loan 31/07/2006

Loan 01/08/2007

Loan 31/12/2007

Loan 01/03/2010

Loan 01/02/2013                                         

Loan 03/02/2014                                         

Loan 07/07/2014

Bank of England Base Rate +1.25%

Bank of England Base Rate +1.25%

     LIBOR +1.75%

LIBOR +3.00% 

    LIBOR +1.95%

    LIBOR +1.95%

LIBOR +1.95%

2019

2020

2020

2017

2018

2019

2019

2014

£000

1,409

435

5,047

1,751

1,683

2,470

2,100

2013

£000

1,688

507

5,834

1,957

1,881

-

-

14,895

11,867

43

           
  
  
  
  
Notes (continued)
(forming part of the ﬁ nancial statements)

18  Trade and other payables

Current

Vehicle consignment creditor

Other trade payables

Non-trade payables and accrued expenses

Vehicle funding

2014

£000

55,419

10,537

11,306

20,710

97,972

2013  

£000

44,760

7,937

9,524

18,905

81,126

Included within trade and other payables is £ nil (2013: £nil) expected to be settled in more than 12 months.
Both the consignment and vehicle funding creditors are secured on the stock to which they relate.

19  Employee beneﬁ ts

Pension plans

Deﬁ ned contribution plans 

The Group operates a number of deﬁ ned contribution pension plans.
The total expense relating to these plans in the current year was £326,000 (2013: £152,000).

20  Provisions

Balance at 1 September 2013

Provisions used during the year

Balance at 31 August 2014

Current

Non current

Balance at 31 August 2013

Current

Non current

Balance at 31 August 2014

Onerous Leases

£000

51

(40)

11

41

10

51

11

-

11

The onerous lease provision is being released against the costs incurred on the relevant lease.  The provision will be fully released by 2015. 

44

Notes (continued)
(forming part of the ﬁ nancial statements)

21  Capital and reserves 

Share capital

Authorised

100,000,000 Ordinary shares of 10 pence each

Allotted, called up and fully paid

100,000,000 Ordinary shares of 10 pence each

Shares classiﬁ ed in shareholders funds

2014

£000

10,000  

10,000              

10,000  

10,000             

10,000

10,000

2013

£000

10,000  

10,000

10,000

10,000

10,000

10,000

All of the shares rank pari passu, and no shareholder enjoys diﬀ erent or enhanced voting rights from any other shareholder. All shares are eligible 

for dividends and rank equally for dividend payments.

45

     
       
            
            
           
            
Notes (continued)
(forming part of the ﬁ nancial statements)

Dividends

The following dividends were paid by the Company in the year ended 31 August.

0.4p per ordinary share - prior year ﬁ nal (2013: 0.3p)

0.1p per ordinary share - current year interim (2013: 0.1p)

2014

£000  

400

100

500

2013

£000

300  

100

400

After the end of the reporting period, the following dividends were proposed by the directors.  The dividends have not been provided for and 

there are no tax consequences.

0.5p per ordinary share - current year ﬁ nal (2013: 0.4p)

2014

£000  

500

2013

£000

400

22 Financial instruments

22 (a) Fair values of ﬁ nancial instruments

Trade and other receivables

The fair value of trade and other receivables, is estimated as the present value of future cash ﬂ ows, discounted at the market rate of interest at the 

balance sheet date if the eﬀ ect is material.

Trade and other payables

The fair value of trade and other payables is estimated as the present value of future cash ﬂ ows, discounted at the market rate of interest at the balance 

sheet date if the eﬀ ect is material.

Cash and cash equivalents

The fair value of cash and cash equivalents is estimated as its carrying amount where the cash is repayable on demand.  Where it is not repayable on 

demand then the fair value is estimated at the present value of future cash ﬂ ows, discounted at the market rate of interest at the balance sheet date.

Interest-bearing borrowings

Fair value, which after initial recognition is determined for disclosure purposes only, is calculated based on the present value of future principal and 

interest cash ﬂ ows, discounted at the market rate of interest at the balance sheet date. 

The rates used to discount estimated cash ﬂ ows, where applicable are based on the weighted average cost of capital and were as follows:

Loans and borrowings

46

2014

%

3.5

2013

%

3.0

 
 
Notes (continued)
(forming part of the ﬁ nancial statements)

Fair values

The fair values for each class of ﬁ nancial assets and ﬁ nancial liabilities together with their carrying amounts shown in the balance sheet 

are as follows: 

Financial assets

Loans and receivables at amortised cost including cash and cash equivalents

Trade receivables (net) (note 15)

Other receivables (note 15)

Cash and cash equivalents

Total Financial assets

Financial liabilities

Financial liabilities at amortised cost

Other interest-bearing loans and borrowings (note 17)

Trade and other payables (note 18)

As at 31 August 
2014

As at 31 August 
2013

£000

£000

7,130

3,228

10,251

5,790

2,248

14,754

20,609

22,792

14,895

97,972

11,867

81,126

Total Financial liabilities

112,867

92,993

The Directors consider the carrying amount of the Group’s ﬁ nancial assets and ﬁ nancial liabilities, as detailed above, approximate their 

fair value.

47

 
     
      
            
     
Notes (continued)
(forming part of the ﬁ nancial statements)

22 Financial instruments (continued)

22 (b) Credit risk

Credit risk management 

The Group is exposed to credit risk primarily in respect of its trade receivables.  Trade receivables are stated net of provision for estimated 

impairment losses.  Exposure to credit risk in respect of trade receivables is mitigated by the Group’s policy of only granting credit to certain 

customers after an appropriate evaluation of risk coupled with the ﬁ ndings from external reference agencies.  Credit risk arises in respect of 

amounts due from vehicle manufacturers in relation to bonuses and warranty receivables.  This risk is mitigated by the number of manufacturers 

for which  the group  holds  franchises, procedures  to ensure  timely collection of debts and  management’s  belief  that  it does  not expect any 

manufacturer to fail to meet its obligations.  The maximum exposure to credit risk is represented by the carrying amount of each ﬁ nancial asset 

in the statement of ﬁ nancial position.      

Exposure to credit risk

The carrying amount of trade receivables represents the  maximum credit exposure. Therefore, the  maximum exposure to credit risk at the 
balance sheet date was £7,130,000 (2013: £5,790,000) being the total of the carrying amount of trade receivables shown in the table below.
The maximum exposure to credit risk for trade receivables at the balance sheet date by geographic region was:

United Kingdom

2014

£000

7,130

The maximum exposure to credit risk for trade receivables at the balance sheet date by type of counterparty was:

Vehicle debtors

Non vehicle debtors

Manufacturer debtors

2014

£000

3,359

2,403

1,368

7,130

2013

£000

5,790

2013

£000

2,486

2,767

537

5,790

Credit quality of ﬁ nancial assets and impairment losses

The ageing of trade receivables at the balance sheet date is given below. The Group’s policy is to provide for all debts which are past due. The 

directors consider the balance to be recoverable based on credit terms and post balance sheet receipts. 

Gross

Impairment

Gross

Impairment

2014  

£000

7,130

89

7,219

2014

£000

-

89

89

2013  

£000

5,790

123

5,913

2013

£000

-

123

123

Trade receivables not past due

Trade receivables past due

48

            
   
         
       
     
   
         
   
         
  
         
  
         
   
     
 
     
  
     
 
     
Notes (continued)
(forming part of the ﬁ nancial statements)

22 Financial instruments (continued)

22 (b) Credit risk (continued)

The movement in the allowance for impairment in respect of trade receivables during the year was as follows:

Balance at 1 September 2013

Impairment gain recognised

Allowance for Impairment utilised

Balance at 31 August 2014

£000

123

(11)

(23)

89

The allowance account for trade receivables is used to record impairment losses unless the Group is satisﬁ ed that no recovery of the amount 

owing is possible; at that point the amounts considered irrecoverable are written oﬀ  against the trade receivables directly.

22 (c) Liquidity risk

Liquidity risk management 

Liquidity risk is the risk that the Group will not be able to meet its ﬁ nancial obligations as they fall due.  Liquidity is managed by the Group’s central treasury 

function within policy guidelines set by the Board with prime areas of focus being liquidity and interest rate exposure.  The Group is ﬁ nanced primarily by 

bank loans, vehicle stocking credit lines and operating cash ﬂ ow.  The directors have assessed the future funding requirements of the Group and compared 

them to the level of committed available borrowing facilities.  These committed facilities are maintained at levels in excess of planned requirements and 

are in addition to short term uncommitted facilities that are also available to the Group.  The assessment included a review of ﬁ nancial forecasts, ﬁ nancial 

instruments and cash ﬂ ow projections.  These forecasts and projections show that the Group, taking account of reasonably possible scenarios, should be 

able to operate within the level of its borrowing facilities for the foreseeable future.         

The following are the contractual maturities of ﬁ nancial liabilities, including estimated interest payments and excluding the eﬀ ect of netting agreements: 
Interest is payable on loans of £1,844,000 (2013: £2,195,000) at Bank of England base rate plus 1.25%, loans of £5,047,000 (2013: £5,834,000) at LIBOR plus 
1.75%, loans of £1,751,000 (2013: £1,957,000) at LIBOR plus 3% and on loans of £6,253,000 (2013: £1,881,000) at LIBOR plus 1.95%.

Carrying 
amount

Contractual 
cash ﬂ ows

1 year
or less

1 to
 <2years

2 to
 <5years

2013

£000

£000

£000

£000

£000

5years
 and
 over

£000

Non-derivative ﬁ nancial liabilities

Secured bank loans

11,867

12,835

1,818

1,782

6,868

2,367

Carrying 
amount

Contractual 
cash ﬂ ows

1 year
or less

1 to
 <2years

2 to
 <5years

2014

£000

£000

£000

£000

£000

5years
 and
 over

£000

Non-derivative ﬁ nancial liabilities

Secured bank loans

14,895

15,998

2,362

2,314

10,115

1,207

49

 
      
      
       
      
     
 
 
 
 
 
 
Notes (continued)
(forming part of the ﬁ nancial statements)

22 Financial instruments (continued)

22 (d) Market risk

Financial risk management

Market risk is the risk that changes in market prices, such as interest rates will aﬀ ect the Group’s income or the value of its holdings of ﬁ nancial 

instruments.

Market risk - Foreign currency risk

The Group does not have any exposure to foreign currency risk. 

Market risk – Interest rate risk

Proﬁ le

At the balance sheet date the interest rate proﬁ le of the Group’s interest-bearing ﬁ nancial instruments was:

Variable rate instruments

Cash and cash equivalents

Vehicle funding

Loans and overdrafts

2014

£000

10,251

(20,710)

(14,895)

2013

£000

14,754

(18,905)

(11,867)

(25,354)

(16,018)

The objectives of the Group’s interest rate policy are to minimise interest costs.  The Group does not actively manage cash ﬂ ow interest risk as 

the directors believe that the underlying earnings from the retail sector in which the Group operates provides a natural hedge against interest 

rate movements.  Consequently, it is Group policy to borrow on a ﬂ oating rate basis.

Whilst there are no hedging instruments, the Board reviews its hedging policy on a regular basis.

Sensitivity analysis 

An increase of 0.5 basis points in interest rates at the balance sheet date would have decreased equity and proﬁ t or loss by the amounts shown 

below. 

This  analysis  assumes  that  all  other  variables,  in  particular  foreign  currency  rates,  remain  constant  and  considers  the  eﬀ ect  of  ﬁ nancial 

instruments with variable interest rates, ﬁ nancial instrument at fair value through proﬁ t or loss or available for sale with ﬁ xed interest rates and 

the ﬁ xed rate element of interest rate swaps. The analysis is performed on the same basis for comparative periods.

2014

£000

176

2013

£000

149

176

149

Equity

Decrease

Proﬁ t or loss

Decrease

50

 
            
     
Notes (continued)
(forming part of the ﬁ nancial statements)

22 Financial instruments (continued)

22 (e) Capital management

Prior to each acquisition, the Board considers its funding options and the appropriate mix of secured debt and equity.

The Group’s primary objective when managing capital is to safeguard the Group’s ability to continue as a going concern in order to provide 
returns for shareholders and beneﬁ ts to other stakeholders.  The Group must ensure that suﬃ  cient capital resources are available for working 
capital requirements and meeting principal and interest payment obligations as they fall due.

Consistent with others in the industry, the Group monitors capital on the basis of the gearing ratio, which is calculated as net debt divided by 
total capital.  Net debt is calculated as total borrowings (including current and non-current borrowings as shown in the statement of ﬁ nancial 
position) less cash and cash equivalents.  Total capital is calculated as total shareholders’ equity.

The gearing ratios for each year are as follows:

Total borrowings

Less: cash and cash equivalents

Net deﬁ cit/ (surplus)

Total equity

Gearing ratio

23 Operating leases

Non-cancellable operating lease rentals are payable as follows: 

Less than one year

Between one and ﬁ ve years

More than ﬁ ve years

As at 31 August 
2014

As at 31 August
 2013

£000

14,895

(10,251)

£000

11,867

(14,754)

4,644

(2,887)

28,286

24,633

16.4%

(11.7%)

2014

£000

2,394

8,775

16,153

2013

£000

2,409

7,491

20,193

27,322

30,093

The Group leases a number of motor dealership sites under operating leases.  Land and buildings have been considered separately for lease 

classiﬁ cation.  

During the year £2,440,000 was recognised as an expense in the income statement in respect of operating leases (2013: £2,644,000).

51

            
 
           
            
Notes (continued)
(forming part of the ﬁ nancial statements)

24 Contingencies

The Group is jointly and severally liable in respect of value added tax liabilities arising in other group undertakings.  The related fellow subsidiary 

undertakings and the parent company were is a repayment situation at 31 August 2013 and 2014.

In recognition of the Cambria Automobiles plc group bank and used vehicle funding facilities, the following companies have entered into a joint 

agreement to guarantee liabilities with banks and ﬁ nance houses of the motor manufacturers that provide new and used vehicles to the group: 

Cambria Automobiles plc, Cambria Automobiles Property Limited, Cambria Automobiles Group Limited, Cambria Automobiles Acquisitions 

Limited,  Cambria  Automobiles  (Swindon)  Limited,  Grange  Motors  (Swindon)  Limited,  Thoranmart  Limited,  Cambria  Automobiles  (South 

East) Limited, Grange Motors (Brentwood) Limited, Invicta Motors Limited, Invicta Motors (Maidstone) Limited and Cambria Vehicle Services 

Limited.

Intra-group guarantees are accounted for as insurance contracts.

25 Related parties

Identity of related parties with which the Group has transacted

Key management personnel are considered to be the board of directors for the purposes of this disclosure.

Transactions with key management personnel

At the year end, the Directors of the Company and their immediate relatives controlled 46.96% (2013: 47.81%) per cent of the voting shares of the Company. 

The compensation of key management personnel is as follows:

Directors’ emoluments

Salaries and consultancy fees

Annual bonus

The emoluments consist of:

Directors’ emoluments

Philip Swatman

James Mullins

Mark Lavery

Sir Peter Burt

Michael Burt

2014

£000

655

473

2013

£000

530

498

1,128

1,028

Total

2014

£000

30

298

750

25

25

Total

2013

£000

30

268

680

25

25

473

1,128

1,028

Salaries

Bonus

2014

£000

-

123

350

-

-

2014

£000

30

175

400

25

25

655

All directors beneﬁ ted from qualifying third party indemnity provisions during the ﬁ nancial period.

52

 
            
 
  
            
       
       
  
    
  
Notes (continued)
(forming part of the ﬁ nancial statements)

25 Related parties (continued)

During the year Mark Lavery bought 4 vehicles from the Group and sold 4 vehicles back to the Group, James Mullins bought 4 vehicles from the 

Group and sold 4 vehicles back to the Group.  Sir Peter Burt bought 3 vehicles from the Group and sold 3 vehicles back to the Group. Michael 

Burt bought 2 vehicles from the Group and sold 2 vehicles back to the Group.  Philip Swatman bought 1 vehicle and sold 1 vehicle back to the 

Group.  All transactions were carried out at arm’s length and there were no outstanding balances due to the Group at the year end, the average 

value of each transaction in the year was £47,805.

26 Ultimate parent company and parent company of larger group

In the opinion of the directors, the distribution of the ordinary shares and the rights attributing themselves to them means that there is no 

overall controlling party of the Company.

27 Post balance sheet events

Dividend

The Board is pleased to announce that it will make a ﬁ nal dividend payment in respect of the ﬁ nancial year to 31 August 2014 of 0.5p (2013: 0.4p) 
per share in addition to the interim payment of 0.1p per share.

53

Company Balance Sheet
At 31 August 2014

Fixed assets

Tangible Fixed Assets

Investments

Current assets

Stock 

Debtors 

Cash at bank and in hand

Creditors: amounts falling due within one year 

Net current assets

Total assets less current liabilities

Net assets

Capital and reserves

Called up share capital

Share premium account

Proﬁ t and loss account

Shareholders’ funds

Note

2014

 2013

£000

£000

£000

£000

5

6

7

8

9

11

12

12

109

666

860

4,985

9,445

15,290

(2,853)

97

666

775

763

780

407

14,802

15,989

(2,509)

12,437

13,212

13,212

10,000

799

2,413

13,212

13,480

14,243

14,243

10,000

799

3,444

14,243

These ﬁ nancial statements were approved by the board of directors on 24 November 2014 and were signed on its behalf by:

M J J Lavery
Director

Company number: 05754547

54

    
          
              
    
          
 
             
  
            
              
         
    
          
 
         
     
Company Reconciliation of movements in shareholders’ funds
for the year ended 31 August 2014

(Loss)/proﬁ t for the ﬁ nancial year

Dividend paid

Net decrease in shareholders’ funds

Opening shareholders’ funds

Closing shareholders’ funds

Note

Company

Company

12

2014

£000

(531)

(500)

(1,031)

14,243

13,212

2013

£000

28

(400)

(372)

14,615

14,243

55

Notes (continued)

1  Accounting policies

The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the ﬁ nancial 
statements.

Going Concern

The directors believe that the company is well placed to manage its business risks successfully despite the current uncertain economic outlook.

The directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable 
future. Thus they continue to adopt the going concern basis in preparing the annual ﬁ nancial statements.

Further information regarding the company’s business activities together with the factors likely to aﬀ ect its future development, performance 
and position is set out in the Strategic report on page 16.

Basis of preparation

The ﬁ nancial statements have been prepared in accordance with applicable accounting standards and under the historical cost accounting rules.  

Under section 408 of the Companies Act 2006 the company is exempt from the requirement to present its own proﬁ t and loss account.

Under Financial Reporting Standard 1 the Company is exempt from the requirement to prepare a cash ﬂ ow statement on the grounds that the 
Group ﬁ nancial statements include the Company in its own published consolidated ﬁ nancial statements.

The Company has taken advantage of the exemption contained in FRS 8 and has therefore not disclosed transactions or balances with entities 
which form part of the group.  

Fixed assets and depreciation

Depreciation is provided to write oﬀ  the cost less the estimated residual value of tangible ﬁ xed assets by instalments over their estimated useful 
lives of each part of an item of property, plant and equipment. Land is not depreciated. The estimated useful lives are as follows:

•  computer equipment 

3 to 5 years

Investments

Investments in subsidiary undertakings are stated at cost less amounts written oﬀ .  Where impairment indicators exist, the carrying value of 
investments will be reviewed against the value is use based upon the estimated future cash ﬂ ows of the subsidiary undertaking.

Stocks

Stocks are stated at the lower of cost and net realisable value.  In determining the cost of motor vehicles, the actual amount payable to date 
for each car is used, for spare parts and service items stocks are valued at invoiced cost on a FIFO basis.  An appropriate provision is made for 
obsolete or slow moving items.

New vehicles on consignment from manufacturers are included in the balance sheet where it is considered that the company bears the risks and 
rewards or ownership.

Consignment  stock  is  held  for  a  maximum  period  (which  varies  between  manufacturers)  before  becoming  due  for  payment.  Part  of  the 
consignment period is interest free and the remaining period are interest bearing (periods varies between manufacturers). 

Taxation

The charge for taxation is based on the proﬁ t for the year and takes into account taxation deferred because of timing diﬀ erences between the 
treatment of certain items for taxation and accounting purposes.

Deferred tax is recognised, without discounting, in respect of all timing diﬀ erences between the treatment of certain items for taxation and 
accounting purposes which have arisen but not reversed by the balance sheet date, except as otherwise required by FRS 19.

56

Notes (continued)

Classiﬁ cation of ﬁ nancial instruments issued by the Company

Following the adoption of FRS 25, ﬁ nancial instruments issued by the Group are treated as equity (i.e. forming part of shareholders’ funds) only 

to the extent that they meet the following two conditions: 

a)   they  include  no contractual obligations upon the  Company  (or  Group as the case  may  be) to deliver cash or other ﬁ nancial assets or to 

exchange ﬁ nancial assets or ﬁ nancial liabilities with another party under conditions that are potentially unfavourable to the Company (or 

Group); and 

b)  where the instrument will or may be settled in the Company’s own equity instruments, it is either a non-derivative that includes no obligation 

to deliver a variable number of the Company’s own equity instruments or is a derivative that will be settled by the Company’s exchanging a 

ﬁ xed amount of cash or other ﬁ nancial assets for a ﬁ xed number of its own equity instruments.

To the extent that this deﬁ nition is not met, the proceeds of issue are classiﬁ ed as a ﬁ nancial liability.  Where the instrument so classiﬁ ed takes 

the legal form of the Company’s own shares, the amounts presented in these ﬁ nancial statements for called up share capital and share premium 

account exclude amounts in relation to those shares.  

Finance payments associated with ﬁ nancial liabilities are dealt with as part of interest payable and similar charges.  Finance payments associated 

with  ﬁ nancial  instruments  that  are  classiﬁ ed  as  part  of  shareholders’  funds  (see  dividends  policy),  are  dealt  with  as  appropriations  in  the 

reconciliation of movements in shareholders’ funds.  

Dividends on shares presented within equity

Dividends unpaid at the balance sheet date are only recognised as a liability at that date to the extent that they are appropriately authorised 

and are no longer at the discretion of the Company.  Unpaid dividends that do not meet these criteria are disclosed in the notes to the ﬁ nancial 

statements. 

2  Remuneration of directors

Directors’ emoluments

Salaries

Annual bonus

Pension costs

The emoluments in respect of the highest paid director were:

Directors’ emoluments

Salaries

Annual bonus

All directors beneﬁ ted from qualifying third party indemnity provisions during the ﬁ nancial period.

2014

£000

655

473

2

2013

£000

530

498

-

1,130

1,028

2014

£000

400

350

750

2013

£000

300

380

680

57

 
 
Notes (continued)

3  Staff numbers and costs

The average number of persons employed by the Company (including directors) during the period, analysed by category, was as follows:

Number of employees

Administration

The aggregate payroll costs of these persons were as follows:

Wages and salaries

Social security costs

Other pension costs

4  Dividends

The aggregate amount of dividends paid & received compromises:

Aggregate amount of dividends paid in the ﬁ nancial year

Aggregate amount of dividends received in the ﬁ nancial year

Company

2014

Company

2013

49

48

Company

Company

2014

£000

3,336

443

28

2013

£000

3,128

404

14

3,807

3,546

2014

£000

500

-

2013

£000

400

-

The aggregate amount of dividends proposed but not recognised at the year end is £500,000 (2013: £400,000).

58

 
 
Notes (continued)

5  Tangible ﬁ xed assets

Company

Cost 

At 1 September 2013

Additions

Disposals

At 31 August 2014

Depreciation

At 1 September 2013

Charge for year

Disposals

At 31 August 2014

Net book value

At 31 August  2014

31 August 2013

Computer equipment

£000

543

94

(14)

623

446

82

(14)

514

109

97

Total

£000

543

94

(14)

623

446

82

(14)

514

109

97

59

      
    
     
     
         
    
        
Notes (continued)

6  Fixed asset investments

Company

Cost and net book value

At 1 September 2013 and 31 August 2014

Shares in group
undertakings

£000

666

The directors have considered the investments in subsidiary undertakings for impairment by comparing the carrying amount to the value in 

use and have concluded that no impairment is required.

The undertakings in which the Company’s interest at the year end is more than 20% are as follows:

Country of
incorporation

Principal activity

Class and percentage 
of shares held

Subsidiary undertakings

Cambria Automobiles Group Limited

England and Wales

Holding Company

Cambria Automobiles Acquisitions Limited **

England and Wales

Investment Company

Cambria Automobiles Property Limited **

England and Wales

Property Company

100% Ordinary

100% Ordinary

100% Ordinary

Cambria Automobiles (Swindon) Limited *

England and Wales

Grange Motors (Swindon) Limited * 

Thoranmart Limited *

Cambria Vehicle Services Limited*

England and Wales

England and Wales

England and Wales

Cambria Automobiles (South East) Limited*

England and Wales

Grange Motors (Brentwood) Limited***

Invicta Motors Limited***

Deeslease Limited***

Dove Group Limited***

England and Wales

England and Wales

England and Wales

England and Wales

Translease Vehicle Management Limited***

England and Wales

Motor retailer

Motor retailer

Motor retailer

Motor retailer

Motor retailer

Motor retailer

Motor retailer

Dormant

Dormant

Dormant

Invicta Motors (Maidstone) Limited*

England and Wales

Motor retailer

100% Ordinary & Preference

100% Ordinary

100% Ordinary

100% Ordinary

100% Ordinary 

100% Ordinary 

100% Ordinary & Preference

100% Ordinary 

100% Ordinary 

100% Ordinary 

100% Ordinary

  *  Owned directly by Cambria Automobiles Acquisitions Limited

  **   Owned directly by Cambria Automobiles Group Limited

 ***   Owned directly by Cambria Automobiles (South East) Limited

7  Stocks

Motor vehicles

60

2014

£000

860

2013

£000

780

Notes (continued)

8 Debtors

Trade debtors

Amounts owed by group undertakings

Prepayments and accrued  income

Deferred tax (note 10)

Other taxation

9 Creditors: amounts falling due within one year

Amounts owed to group undertakings

Trade creditors

Vehicle funding

Other taxation and social security

Accruals and deferred income

Corporation tax

The vehicle funding creditor is secured on the stock to which it relates.

2014

£000

18

4,458

380

38

91

4,985

2014

£000

-

339

317

251

1,946

-

2,853

2013

£000

33

-

337

37

-

407

2013

£000

121

394

493

126

1,370

5

2,509

61

       
             
     
  
 
 
 
Notes (continued)

10  Deferred taxation

Deferred Taxation

At 1 September 2013

Movement in period

At 31 August 2014

The elements of deferred taxation asset are as follows:

Difference between accumulated depreciation and capital allowances

Other timing differences

Total deferred tax

2014

£000

38

-

38

£000

Company

37

1

38

2013

£000

37

-

37

62

           
       
           
       
              
Notes (continued)

11  Called up share capital

Authorised

2014

£000

2013

£000

100,000,000 Ordinary shares of 10 pence each

10,000              

10,000

Allotted, called up and fully paid

100,000,000 Ordinary shares of 10 pence each

Shares classiﬁ ed in shareholders funds

10,000

10,000

10,000              

10,000

10,000

10,000

10,000

10,000

10,000

10,000

All of the shares rank pari passu, and no shareholder enjoys diﬀ erent or enhanced voting rights from any other shareholder. All shares are eligible 

for dividends and rank equally for dividend payments.

12  Share premium and reserves

At 1 September 2013

Loss for the year

Dividend paid

At 31 August 2014

Share premium account

Proﬁ t and loss account

£000

799

-

-

799

£000

3,444

(531)

(500)

2,413

13  Ultimate parent company and parent undertaking of larger group

In the opinion of the directors, the distribution of the ordinary shares and the rights attributing themselves to them means that there is no 

overall controlling party of the Company.

63