A n n u a l R e p o r t a n d A c c o u n t s 2 0 1 8
Colefax Group is an international designer and distributor of luxury
furnishing fabrics and wallpapers and a leading international decorating
company. Sales are made under the brand names Colefax and Fowler,
Cowtan and Tout, Jane Churchill, Larsen and Manuel Canovas. The Group
has offices in the UK, USA, France, Germany and Italy which form part of
an expanding worldwide distribution network.
C O N T E N T S
Financial Highlights
Chairman’s Statement
Strategic Report
Directors, Bankers and Advisers
Directors’ Report
Statement of Directors’ Responsibilities
Independent Auditors’ Report
Group Income Statement
Group Statement of Comprehensive Income
Group Statement of Financial Position
Company Statement of Financial Position
Group Statement of Cash Flows
Company Statement of Cash Flows
Group Statement of Changes in Equity
Company Statement of Changes in Equity
Notes to the Accounts
Five Year Review
Notice of Meeting
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2
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9
12
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35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 1
COLEFAX GROUP PLC
F I N A N C I A L H I G H L I G H T S
2018 2017
£’000 £’000 Increase
Revenue 86,052 80,475 7%
Profit from operations 4,721 2,937 61%
Profit before taxation 4,719 2,937 61%
Profit attributable to shareholders 3,832 1,895 102%
Basic earnings per share 38.1p 18.6p 105%
Diluted earnings per share 38.1p 18.6p 105%
Dividends per share 5.00p 4.80p 4%
Equity 27,419 25,936 6%
Operating cash flow 8,909 4,180 113%
Cash and cash equivalents 9,177 6,710 37%
* Restated
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COLEFAX GROUP PLC
C H A I R M A N ’ S S TAT E M E N T
Financial Results
Group sales for the year to 30 April 2018 increased by 6.9% to £86.05 million (2017: £80.48 million) and by 8.6%
on a constant currency basis. Pre-tax profits increased by 60.7% to £4.72 million (2017: £2.94 million) and
earnings per share increased by 105% to 38.1p (2017: 18.6p). The Group ended the year with net cash of £9.2
million (2017: £6.7 million).
The Board is proposing to increase the final dividend by 4% to 2.60p per share (2017: 2.50p) making a total for
the year of 5.00p (2017: 4.80p), an increase of 4%. This increase is in line with the Group’s progressive dividend
policy and preferred strategy of returning surplus cash to shareholders via share buybacks. The final dividend,
which is subject to shareholder approval, will be paid on 10 October 2018 to shareholders on the register at the
close of business on 7 September 2018.
During the year the Group returned £2.17 million (2017 – £2.58 million) to shareholders through the purchase of
413,000 shares at an average price of £5.25 per share and representing 4.2% of the issued share capital of the
Company.
The improvement in our profit was for three main reasons. Firstly, losses on hedging put in place prior to the Brexit
vote reduced to £959,000 from £2.0 million last year and have now come to an end. Secondly, our Decorating
Division delivered an exceptional performance making a profit before tax of £901,000 compared to a profit of
£108,000 last year. Thirdly, in our core Fabric Division, sales in our main US market increased by 6.2% on a
constant currency basis.
Excluding share buybacks and dividend payments the Group generated cash of £5.5 million during the year
(2017 – £1.3 million outflow). This improvement was due to a combination of increased profitability, significantly
lower capital expenditure and tight control of working capital.
Capital expenditure during the year was £2.38 million compared to an exceptional £4.1 million last year when
we opened our own US showrooms in Atlanta and Boston and moved our UK based Decorating Division to a new
showroom and offices in Belgravia. The benefit of these investments is reflected in our current year performance.
The 105% increase in earnings per share compared to the 60.7% increase in pre-tax profits is mainly due to a
significantly lower Group tax charge of 19% compared to 35% last year. This includes a one-off deferred tax
benefit of £350,000 relating to a reduction in the US corporate tax rate. From January 2018 US federal corporate
tax rates reduced from 35% to 21% and the Group will realise the full benefit of this change in future years.
Product Division
•
Fabric Division - Portfolio of Five Brands: “Colefax and Fowler”, “Cowtan and Tout”, “Jane Churchill”,
“Manuel Canovas” and “Larsen”.
Sales in the Fabric Division, which represent 83% of Group turnover, were up by 1.5% to £71.11 million (2017 –
£70.05 million) and up by 3.3% on a constant currency basis. Operating profit increased by 31.8% to £3.69
million (2017 – £2.80 million) but excluding hedging losses was down by 3.1% to £4.65 million (2017 £4.80
million) reflecting a weaker US Dollar average rate of $1.34 compared to $1.29 last year.
The main reason for the increase in Fabric Division sales on a constant currency basis was an improvement in
trading conditions in our core US market which represents 59% of the Fabric Division’s turnover. US sales
increased by 6.2% compared to a decline of 7.7% last year. Sales in the second half of the year increased by 7.8%
compared to 4.3% for the first half. The improving trend reflects the strength of the US economy and in particular
the housing market. Following the opening of our own showrooms in Atlanta and Boston last year, over 75% of
US sales come from territories where we lease our own showroom as opposed to showrooms operated by agents.
We believe this is the right balance for our business at the present time. In the current year we are planning the
refurbishment of our existing Los Angeles showroom. As our largest and most important market the US will remain
our main focus for future capital investment.
Sales in the UK, which represent 18% of the Fabric Division’s turnover increased by 1% during the year despite
increasingly challenging trading conditions at the top end of the market. High rates of stamp duty continue to
weigh on the number of housing transactions and the situation is not being helped by Brexit uncertainty. We
believe that our sales are closely correlated with the health of the high end housing market and would like to see
the top rates of stamp duty reduced to levels where they are not depressing the market. We are currently
refurbishing our trade showroom in Chelsea Harbour and this project will be completed at the end of August.
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COLEFAX GROUP PLC
C H A I R M A N ’ S S TAT E M E N T
Sales in Continental Europe, which represent 21% of the Fabric Division’s turnover, increased by 3.5% in reported
terms but were flat on a constant currency basis. Despite increased optimism in the first half of the year, overall
market conditions in Europe have remained difficult and seem unlikely to improve in the short term. This is
especially true in our major markets, France, Germany and Italy, and despite some improvement in the wider
economy caused by significant monetary stimulus. In France which is our largest market, sales decreased by 2%.
In Germany sales were flat and in Italy sales declined by 1%. Each country in Europe has its own economic and
political issues and our strategy will be to tailor our approach to each market and focus our investment on
countries with the most potential.
Sales in the Rest of the World which represent just under 3% of the Fabric Division’s turnover, decreased by 8%
during the year. The main markets are the Middle East, Australia, China and Russia. The decline in sales was mainly
due to the Middle East where contract orders can cause significant sales fluctuations from year to year.
•
Furniture – Kingcome Sofas
Sales of Kingcome furniture, which represent 3% of Product Division sales increased by 11% to £2.62 million
(2017 – £2.35 million). Operating profit was £130,000 compared to £23,000 last year. This business is the Group’s
only manufacturing activity and profits are particularly sensitive to fluctuations in sales due to the relatively high
fixed cost base. The increase in sales and profit was achieved despite challenging market conditions in the UK and
the order book at the year end was significantly ahead of the prior year. Export sales account for just 13% of total
furniture sales and this represents a growth opportunity especially given the current weakness of Sterling.
Interior Decorating Division
Decorating sales, which account for 14% of Group turnover, increased by 53% to £12.33 million (2017 – £8.06
million) and profits before tax increased to £901,000 compared to a profit of £108,000 for the prior year. Last year
the Decorating Division moved from 39 Brook Street to a new showroom and offices at 89-91 Pimlico Road in
Belgravia. This is the first full year of operation at the new premises and we are very pleased with the overall
performance. The new showroom is popular with customers and although we have less space for antiques a more
selective approach means that sales have exceeded expectations. Sales and profits in the Decorating Division can
vary significantly according to the timing of contracts. Several major projects were completed during the year and
although customer deposits remain healthy we expect activity to return to more normal levels next year. The
business continues to benefit from the weakness of Sterling and we have seen an increase in the proportion of
overseas work.
Prospects
The Group has made good progress over the last twelve months despite generally difficult trading conditions in
most of our major markets. Our largest market, the US, is showing signs of continued growth and this should
underpin our performance in the current year. In addition we no longer have any hedging contracts put in place
prior to the Brexit referendum and will benefit from the current weakness of Sterling. However, any significant
fluctuations in the Sterling US Dollar exchange rate are likely to have a material effect on Group profits. In our
other major markets, the UK and Europe, we are experiencing increasingly difficult trading conditions and we
expect this to offset some of the anticipated growth in the US. In addition we expect our Decorating Division to
return to a more normal level of activity following an exceptional performance last year.
The Group has a strong balance sheet with net cash of £9.2 million and we will continue to invest with confidence
in our portfolio of luxury brands and our worldwide distribution network.
Our results reflect the talent, hard work and loyalty of all our staff throughout the Group and I would like to thank
them for their contribution to our performance and their commitment to the future success of the Group.
David Green
Chairman
25 July 2018
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COLEFAX GROUP PLC
S T R AT E G I C R E P O RT
Strategy and Business Model
The strategy and business model of the Group has remained relatively stable in recent years. The core business is
the design and distribution of luxury furnishing fabrics and wallpapers sold through a ‘portfolio’ of luxury brands.
The rationale behind the portfolio approach is that each brand has a particular look and price point and caters to
a particular segment of the market. The brands have different strengths in different markets and product categories
which enables the Group to maximise sales through its worldwide distribution network. By far the largest and most
important market for the Group is the US which accounts for approximately 59% of fabric and wallpaper sales. As
a result the US market is the main focus for capital investment and new product investment.
An important part of the Group’s strategy is that it does not manufacture any fabrics and wallpapers and they are
sourced from over 100 different high end manufacturers based primarily in Italy, France, Belgium the UK and India.
This broad supplier base avoids the complexity and capital intensive nature of manufacturing and enables the
Group to respond rapidly to changing market tastes.
The Group’s fabric and wallpapers are sold in over 50 countries worldwide although the US and the UK together
account for 77% of Fabric Division sales. The third largest individual country is France which accounts for 6% of
total sales. An important part of the Group’s strategy is that it has no significant retail activity and this avoids the
costs and complexity of retail operations. The Group sells primarily to interior designers and retail fabric and
wallpaper shops (the ‘trade’) and operates one flagship retail outlet at 110 Fulham Road in London which accounts
for just over 1% of sales. The Group adopts different sales approaches according to the size and potential of
individual markets. In major geographical markets the Group mainly employs its own sales staff to sell direct to
trade customers. In medium sized markets the Group sells through agents who receive a sales commission and in
small or complex markets the Group uses exclusive distributors.
The strategic rationale behind the Group’s portfolio of brands is that they each have separate design studios but
share a common operational platform in terms of marketing, sales, sampling, warehousing, purchasing, IT systems
and accounting. This minimises costs and maximises efficiency whilst at the same time keeping the identity of each
brand distinct and separate in the market.
The Group is potentially interested to acquire additional fabric and wallpaper brands provided they complement
the existing portfolio and offer geographical and operational synergies. The industry is still relatively fragmented
with a large number of independent competitors. The ongoing challenge with acquisitions is finding vendors who
are prepared to sell at a realistic price. A cheaper and equally valid alternative to acquisitions is to start a new
brand from scratch or develop a sub-brand. However, we believe there are still good opportunities for organic
growth within the Group’s existing brand portfolio and the advantage of this lower risk strategy has been surplus
cash generation which can be returned to shareholders through our long running share buyback programme.
The Group has five fabric and wallpaper brands all sold at the premium end of the market. Colefax and Fowler is
a renowned luxury English brand and is complemented by another English brand Jane Churchill which is targeted
at a lower price point than Colefax and Fowler. Larsen is a highly innovative contemporary US brand and Manuel
Canovas is an iconic luxury French brand. Cowtan and Tout is a very high end luxury US brand sold exclusively
in the US market.
The Group’s current strategy is to maximise sales and operating profit from its existing portfolio of brands primarily
through an annual cycle of new product investment. This is the key driver of sales growth and the market reaction
to new products is one of the key business risks. Typically each brand introduces a major new collection annually
supplemented by smaller product launches. The Group seeks to reduce business risk by targeting different brands
at different markets and ensuing that each brand remains clearly differentiated with minimal product overlap.
In addition to the Group’s core fabric and wallpaper brands (the Fabric Division) the Group owns a UK based
luxury sofa manufacturer Kingcome Sofas. Production takes place at a freehold factory in Newton Abbot, Devon
which employs 35 highly skilled staff and this is the Group’s only manufacturing activity. All furniture is made to
order backed by customer deposits. It is a relatively small part of the Group accounting for 3.0% of sales. Although
a distinct activity the furniture company is grouped with the fabric and wallpaper brands to make up the Product
Division.
The Group also owns an ultra luxury interior design business trading as Sibyl Colefax and John Fowler Limited.
Founded in 1933 this activity is the original business from which the rest of the Group evolved and is referred to
as the Decorating Division. Currently it accounts for 14% of Group sales. The business undertakes interior design
4
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COLEFAX GROUP PLC
S T R AT E G I C R E P O RT
and decoration projects primarily for high end residential customers. All projects are fully estimated and funded
by customer deposits. There are four Design Directors and three Associate Directors each with their own portfolio
of clients. The business is international with a broad geographical spread and the high end client base means it is
quite resilient to normal economic cycles.
The Decorating Division includes a decorative antiques business which accounts for about 7% of its sales.
Although antique sales are a relatively small part of the total they are strategically important to the Decorating
Division. In recent years the market for antiques has been relatively challenging due to changing consumer tastes
and following the move to new premises at 89-91 Pimlico Road we have taken a more selective approach to
antiques focusing on fewer individual items. This has resulted in improved margins and stock turn.
The project based nature of decorating means that, depending on the timing of projects, there can be significant
fluctuations in profits from year to year. This is important for investors to understand because it can sometimes have
a material impact on the Group’s results.
Key Performance Indicators
Given the size and nature of the Group’s activities the Key Performance Indicators are all financial in nature:
Constant Currency Sales Growth
Gross Profit Margin
Operating Profit Margin
Earnings Per Share
Operating Cash Flow
2018
8.6%
53.7%
5.5%
38.1p
£8.9m
2017
-5.3%
55.1%
3.6%
18.6p
£4.2m
Sales Growth
Group sales were up by 6.9% in reported terms to £86.05 million (2017 – £80.47 million) and up by 8.6% on a
constant currency basis. The sales increase was mainly due to the Decorating Division where sales increased by
£4.2 million or 53% to £12.3 million (2017 £8.1 million). This was an exceptionally strong performance by
Decorating and reflects the completion of a number of major projects during the year. Customer deposits remain
healthy but activity is likely to return to more normal levels next year.
In our core Fabric Division sales increased by 1.5% in reported terms and by 3.3% on a constant currency basis.
Most of the growth came from the US where sales increased by 6.1% largely reversing a 7.7% decline last year.
In the UK sales increased by 0.5% following a 1% decline last year and in Europe constant currency sales
decreased by 0.1% following a 6.0% decline last year. These changes are discussed in more detail in the
Chairman’s Statement. In terms of trends the growth in the US looks likely to continue this year whereas trading in
the UK and Europe looks increasingly difficult.
Gross Profit Margin
The overall gross profit margin decreased from 55.1% to 53.7%. The main reason for the 1.4 percentage point
decline was a significant increase in the proportion of Decorating Division sales where gross profit margins are
much lower than the Fabric Division.
In the Fabric Division the gross margin achieved is heavily influenced by the Sterling – US Dollar exchange rate.
This is because approximately 60% of sales are invoiced in US Dollars but the majority of goods sold are
purchased from suppliers in Sterling or Euros. Every one cent movement in the Sterling Dollar exchange rate affects
gross margin by approximately £95,000.
The sensitivity of profits to the US Dollar rate is the reason why the Group has typically hedged a proportion of its
exposure in the form of forward contracts to sell US Dollars at its budgeted rate. The decision to hedge the US
Dollar prior to the Brexit vote resulted in losses of £2 million in 2017 and £959,000 in 2018. These pre-Brexit
contracts which were mostly at a rate of $1.50 have now ended which means the Group will benefit fully from the
post Brexit weakness of Sterling.
The Group does not have any significant exposure to the Euro Sterling exchange rate as there is a natural hedge
between Euro costs and revenues.
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COLEFAX GROUP PLC
S T R AT E G I C R E P O RT
The average and closing US Dollar and Euro rates were as follows:
US dollar average
US dollar closing
Euro average
Euro closing
2018
1.34
1.38
1.13
1.14
2017
1.29
1.29
1.18
1.19
% change
-3.9%
-7.0%
4.2%
4.2%
Operating Profit Margin
Group operating profit increased by 60.7% to £4.72 million (2017 – £2.94 million) representing an operating profit
margin of 5.5% (2017 – 3.6%). Excluding hedging losses the operating margin would have been £5.68 million or
6.6%. The main reasons for the increase in operating profit were a £1.04 million reduction in hedging losses
resulting from a lower level of cover and a £0.8 million increase in Decorating Division profits. However, the
average US Dollar exchange rate for the year was less favourable at $1.34 compared to $1.29 and the impact of
this was largely offset by a 6.2% increase in US sales.
An important feature of the Group is that profits are highly operationally geared. Gross margins are relatively high
and our cost base is relatively fixed with the result that operating margins are very sensitive to small fluctuations
in sales. Over the last twelve months the main pressure on our cost base has come from premises costs. Apart from
our Kingcome Sofas freehold factory in Devon all of the Group’s showrooms, offices and warehouses are
leasehold. In the UK in particular new rating assessments and rent reviews have led to some unwelcome cost
increases.
As noted last year the Group faces ongoing uncertainty over Brexit and in particular whether or not the UK will
agree a free trade deal with the EU. Tariff free trade with Europe is important to the Group because a majority of
the Fabric Division’s products are purchased in the EU and 21% of sales are made in the EU.
Earnings Per Share
Earnings per share increased by 105% to 38.1p (2017 – 18.6p) reflecting the 61% increase in operating profit as
well as a significant reduction in the effective tax rate from 35.5% to 19%. The reduction in the Group corporate
tax rate is for two main reasons. Firstly corporate tax rates are only 19% in the UK and a higher proportion of profits
were made in the UK due to lower hedging losses and a strong performance from the Decorating Division.
Secondly from January 2018 US federal corporate tax rates reduced from 35% to 21% benefitting apportioned
profits for the last four months of the year. Although the lower US rate was only for four months there was a one
off deferred tax credit of £350,000. This increased earnings per share by 3.5p relating to a reduction in our net US
deferred tax liability. For the current year we expect the Group’s effective tax rate to be around 26%.
Earnings per share also benefitted from a small decrease of 1.1% in the weighted average number of shares in issue
during the year due to share buybacks in the current and prior year.
The Board remains committed to a policy of returning surplus cash to shareholders by way of share buybacks
provided it enhances shareholder value. Since September 1999 the Group has returned £30.77 million to
shareholders through its share buyback program.
Operating Cash Flow
The Group’s operating cash flow increased by £4.5 million to £8.67 million (2017 – £4.18 million) compared to
profit from operations of £4.72 million. The increase compared to last year reflects higher profitability and tight
control of working capital which reduced by £1.2 million compared to an increase of £1.48 million last year. Most
of the change in working capital was due to the unwinding of unrealized hedging losses recorded under current
liabilities. Depreciation amounted to £2.74 million (2017 – £2.72 million) compared to net capital expenditure of
£2.33 million. Next year we are planning to refurbish our Chelsea Harbour showroom in London and our US
showroom in Los Angeles and expect capital expenditure to be broadly in line with depreciation.
The Group ended the year with net cash of £9.2 million compared to £6.7 million last year. This increase of £2.5
million is after share buybacks of £2.2 million and dividend payments of £488,000. Excluding these items cash
generation was £5.13 million.
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COLEFAX GROUP PLC
S T R AT E G I C R E P O RT
Principal Risks and Uncertainties
The Group has put in place controls to identify, monitor and manage the principal risks and uncertainties faced by
the Group. Risks are ranked according to their potential financial impact and probability and a Group Risk
Assessment Report is presented bi-annually to the Audit Committee. The Group’s Executive Directors provide input
into the risk assessment process where relevant.
The principal risks can be summarized into business risks, financial risks and operational risks.
Business risks
The main internal business risk relates to the market reaction to new product investment. The risk is mitigated by
employing talented and experienced design studio staff together with tight budgetary controls over new product
investment and regular feedback and financial analysis.
The main external business risk is a downturn in the high end housing market. The business is not immune to
economic cycles and in particular it tends to lag changes in the strength of the high end housing market. The main
control for responding to changes in the housing market is the amount of new product investment.
The Group faces significant risks from Brexit if the UK leaves the Customs Union and does not agree on a free trade
deal with Europe for goods. This is because the Fabric Division purchases the majority of its goods from suppliers
in Europe and makes 21% of its sales to customers in Europe. Customs duty on European purchases would
adversely affect costs and customs duty on European sales would adversely affect revenues.
Financial risks
There are two major financial risks facing the Group. The first is the US Dollar exchange rate against Sterling. This
can have a material impact on profitability because every one cent movement in the exchange rate impacts Group
profits by approximately £95,000. The Group seeks to hedge against fluctuations in the US Dollar exchange rate
by taking out forward contracts to sell US dollars at rates close to or better than the annual budgeted rate.
The second major financial risk relates to obsolete inventory. Each fabric brand consists of hundreds of individual
fabric and wallpaper options and as a result the largest component of the balance sheet is finished goods stock
amounting to approximately £13.5 million. There are substantial fluctuations in inventory levels during the year
relating to the timing of new product launches. Obsolete stock arises due to surpluses resulting from supplier
minimum orders, risks associated with new product introduction and product discontinuations. Some obsolete
inventory is an inevitable feature of the business but the Board seeks to mitigate the risk of obsolete inventory
through tight purchasing controls and budgetary controls over new product investment.
Operational risks
There are two main operational risks. The first relates to the loss or failure of the Group’s IT system in the UK or
the US. The nature of the Fabric Division business is that it involves large numbers of stock items, large numbers
of customers and a high volume of transactions. As a result the Group is highly dependent on its IT systems and
the main way that the Group mitigates this risk is through real-time backup procedures in the UK and the US. In
addition the Group has full business interruption insurance.
The second main operational risk relates to loss or damage to the Group’s warehouse and operations facilities in
the US and the UK including loss or damage to inventory. The risk is spread by having three warehouse buildings
in the UK and one in the US. The main way that the Group mitigates this risk is by having alarm systems and
disaster recovery plans as well as full inventory insurance and business interruption insurance.
The above report was approved by the Directors on 25 July 2018 and signed on its behalf by
R. M. Barker BSc ACA
Group Finance Director
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COLEFAX GROUP PLC
D I R E C T O R S, B A N K E R S A N D A D V I S E R S
Directors
Nominated Advisers and Stockbrokers
D. B. Green, Chairman and Chief Executive
R. M. Barker BSc ACA, Finance Director
W. Nicholls, Decorating Managing Director
K. Hall, Chief Executive Officer – USA
A. K. P. Smith, Non-Executive Director
Secretary and Registered Office
R. M. Barker BSc ACA
19-23 Grosvenor Hill
London W1K 3QD
Registered in England No. 1870320
Peel Hunt LLP
Moor House
120 London Wall
London EC2Y 5ET
Auditors
BDO LLP
55 Baker Street
London W1U 7EU
Solicitors
Keystone Law
48 Chancery Lane
London WC2A 1JF
Bankers
HSBC Bank plc
31 Holborn
London EC1N 2HR
HSBC Bank USA
452 Fifth Avenue
New York
NY 10018
U.S.A.
JP Morgan Chase Bank
270 Park Avenue
41st Floor
New York
NY 10017
U.S.A.
Registrars and Transfer Office
Computershare Investor Services PLC
The Pavilions
Bridgwater Road
Bristol BS99 6ZY
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COLEFAX GROUP PLC
D I R E C T O R S ’ R E P O RT
Principal Activities
The principal activities of the Group are the design, marketing, distribution and retailing of furnishing fabrics,
wallpapers, trimmings, related products and upholstered furniture in the UK and overseas and the sale of antiques,
interior and architectural design, project management, decorating and furnishing for private and commercial clients.
Review of the Business and Future Developments
Details of the Group’s activities during the year, key performance indicators and future plans are contained in the
Chairman’s Statement on pages 2 and 3, and in the Strategic Report on pages 4 to 7.
Share Capital
At the forthcoming Annual General Meeting, certain resolutions are to be proposed relating to the allotment of
shares.
Resolution Number 6, proposed as an ordinary resolution, would authorise the Directors to allot shares in the
Company and to grant rights to subscribe for or to convert any security into shares in the Company up to a
maximum of one third of the issued share capital of the Company for a period expiring on the date of the next
Annual General Meeting or 15 months after the passing of the resolution, whichever occurs first.
In addition, Resolution Number 6 would also authorise the Directors to allot equity securities in connection with
a rights issue up to a maximum of one third of the issued share capital of the Company for a period expiring on
the date of the next Annual General Meeting or 15 months after the passing of the resolution, whichever occurs
first.
Resolution Number 7, proposed as a special resolution, would authorise the Directors to allot shares for cash, on
rights issues and other issues to existing shareholders in proportion to their existing holdings and also allows issues
of sales other than to existing shareholders in respect of a maximum of 5% of the existing issued share capital of
the Company, for a period again expiring on the date of the next Annual General Meeting or 15 months after the
passing of the resolution, whichever occurs first.
Purchase of Own Shares
The Board is committed to a strategy of utilising surplus cash for share buybacks provided they enhance
shareholder value through their effect on earnings per share and return on capital employed. During the year, the
Company repurchased 413,000 shares at an average price of 525p.
Results and Dividends
The Group’s profit after tax was £3,832,000 (2017 – £1,895,000). An interim dividend of 2.4p (2017 – 2.30p) per
share was paid to shareholders on 9 April 2018. The Directors recommend the payment of a final dividend of 2.6p
(2017 – 2.50p) per share to be paid on 10 October 2018 to shareholders on the register at the close of business
on 7 September 2018. The proposed final dividend has not been accrued for because the dividend was declared
after the year end and is yet to be approved at the Annual General Meeting. The total dividend for the year is 5.00p
(2017 – 4.80p) per share and the total of the interim and proposed final dividend is £486,000
(2017 – £488,000).
Employees
The Group values the involvement of its employees and keeps them informed on matters affecting them and on
factors affecting the performance of the Group. Information is given at formal and informal meetings throughout
the year.
The Group believes in a policy of equal opportunities. Recruitment and promotion are undertaken on the basis of
merit, regardless of gender, race, age, marital status, sexual orientation, religion, nationality, colour and disability.
Disabled Persons
It is the policy of the Group to employ disabled persons wherever appropriate. Such disabled employees are given
the same opportunities for training and promotion as other employees. In the event of members of staff becoming
disabled, every effort is made to ensure that their employment with the Group continues.
Events after the Reporting Date
No significant events have occurred since 30 April 2018 at the date of these financial statements.
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Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
D I R E C T O R S ’ R E P O RT
Financial Risk Management
Detail of the use of financial instruments and financial risk management are contained in note 20 to the financial
statements.
Freehold Property
The Group’s freehold property was last valued on 28 April 2011 on an open market value basis by qualified valuers
from Drew Pearce, an independent firm of chartered surveyors. The valuation was carried out in accordance with
guidance issued by the Royal Institution of Chartered Surveyors. The market value determined under this basis was
£850,000.
The net book value of the Group’s freehold property, on a historical cost basis was £163,000 at 30 April 2018
(2017 – £168,000).
Directors
The Directors listed on page 8 have held office throughout the year to 30 April 2018.
In accordance with Article 14.1 of the Company’s Articles of Association, A. K. P. Smith will retire by rotation at
the Annual General meeting. Resolution 5 proposes his re-election as Director. A. K. P. Smith has a service contract
which is terminable by one year’s notice by either the Company or the Director.
Non-Executive Directors
A.K.P. Smith was appointed as non-executive Director in February 1994.
Directors’ Remuneration
Salary and Benefits Pension 2018 2017
fees Bonus in kind contributions Total Total
£’000 £’000 £’000 £’000 £’000 £’000
Executive Directors:
D. B. Green 655 32 28 – 715 679
R. M. Barker 225 10 2 – 237 227
W. Nicholls 190 10 28 – 228 225
K. Hall 332 17 – 22 371 370
Non-executive Directors:
A. K. P. Smith 24 – – – 24 24
1,426 69 58 22 1,575 1,525
Substantial Shareholdings as at 30 April 2018
Number of shares %
D. B. Green 2,718,681 27.7
Rights and Issues Investment Trust plc 2,250,000 22.9
Schroder plc 1,918,234 19.6
10
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
D I R E C T O R S ’ R E P O RT
Directors’ Interests
The Directors’ interests in the share capital of the Company at the end of the financial year were as follows:
Ordinary shares of 10p each
2018 2017
D. B. Green 2,718,681 3,148,681
R. M. Barker 212,902 218,102
W. Nicholls 87,350 97,350
K. Hall 161,100 161,100
A. K. P. Smith 45,000 45,000
No Director has interests in the shares of any subsidiary company.
Share Options
There are no options outstanding in respect of the Colefax Group plc Employee Share Ownership Plan Trust.
The market price of the Company’s shares at 30 April 2018 was 496.5p. The range of market prices during the
financial year was between 460p and 545p.
Corporate Governance
As the Company is listed on the Alternative Investment Market it is not formally required to comply with the UK
Corporate Governance Code. However, the Board seeks to apply the principles of good corporate governance
wherever practical given the confines of a smaller company. The whole Board acts as a Nomination Committee.
The Board has identified the principal business and financial risks facing the Group and documented the key
control procedures that are in place to manage these risks. This document is subject to review by the Audit
Committee and updated on a regular basis.
Auditors
All of the current directors have taken all the steps that they ought to have taken to make themselves aware of any
information needed by the Company’s auditors for the purposes of their audit and to establish that the auditors are
aware of that information. The directors are not aware of any relevant audit information of which the auditors are
unaware.
A resolution to reappoint BDO LLP as auditors will be put to the members at the Annual General Meeting.
By order of the Board
R. M. Barker BSc ACA
Secretary
25 July 2018
11
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
S TAT E M E N T O F D I R E C T O R S ’ R E S P O N S I B I L I T I E S I N R E S P E C T O F
T H E F I N A N C I A L S TAT E M E N T S
Directors’ responsibilities
The directors are responsible for preparing the annual report and financial statements in accordance with
applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the
directors have elected to prepare the group and company financial statements in accordance with International
Financial Reporting Standards (IFRSs) as adopted by the European Union. Under company law the directors must
not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs
of the group and company and of the profit or loss of the group for that period. The directors are also required to
prepare financial statements in accordance with the rules of the London Stock Exchange for companies trading
securities on the Alternative Investment Market.
In preparing these financial statements, the directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and accounting estimates that are reasonable and prudent;
• state whether they have been prepared in accordance with IFRSs as adopted by the European Union, subject
to any material departures disclosed and explained in the financial statements;
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the
company’s transactions and disclose with reasonable accuracy at any time the financial position of the company
and enable them to ensure that the financial statements comply with the requirements of the Companies Act 2006.
They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
Website publication
The directors are responsible for ensuring the annual report and the financial statements are made available on a
website. Financial statements are published on the company‘s website in accordance with legislation in the United
Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in
other jurisdictions. The maintenance and integrity of the company‘s website is the responsibility of the directors.
The directors’ responsibility also extends to the ongoing integrity of the financial statements contained therein.
12
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
I N D E P E N D E N T AU D I T O R S ’ R E P O RT
T O T H E M E M B E R S O F C O L E FA X G R O U P P L C
Opinion
We have audited the financial statements of Colefax Group Plc (the ‘parent company’) and its subsidiaries (the
‘group’) for the year ended 30 April 2018 which comprise the group income statement, the group statement of
comprehensive income, the group statement of financial position, the company statement of financial position, the
group statement of cash flows, the company statement of cash flows, the group statement of changes in equity, the
company statement of changes in equity and notes to the financial statements, including a summary of significant
accounting policies.
The financial reporting framework that has been applied in the preparation of the financial statements is applicable
law and International Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards the
parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006.
In our opinion:
• the financial statements give a true and fair view of the state of the group’s and of the parent company’s affairs
as at 30 April 2018 and of the group’s profit for the year then ended;
• the group financial statements have been properly prepared in accordance with IFRSs as adopted by the
European Union;
• the parent company financial statements have been properly prepared in accordance with IFRSs as adopted
by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and
• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit
of the financial statements section of our report. We are independent of the group and the parent company in
accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK,
including the FRC’s Ethical Standard as applied to listed entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report
to you where:
• the directors’ use of the going concern basis of accounting in the preparation of the financial statements is not
appropriate; or
• the directors have not disclosed in the financial statements any identified material uncertainties that may cast
significant doubt about the group’s or the parent company’s ability to continue to adopt the going concern
basis of accounting for a period of at least twelve months from the date when the financial statements are
authorised for issue.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial statements of the current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the
overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate opinion on these matters.
13
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
I N D E P E N D E N T AU D I T O R S ’ R E P O RT
T O T H E M E M B E R S O F C O L E FA X G R O U P P L C ( C O N T I N U E D )
Key Audit Matter How we addressed the matter in our audit
Revenue recognition
A potential risk to the correct cut-off of revenue arises
with respect to recording revenue for decorating
contracts where work continues across the year end.
Judgement is required in determining the extent of work
completed.
The group’s accounting policy for revenue recognition
is disclosed in note 1 and the financial statements
disclose further detail concerning the group’s revenues
in notes 3 and 4.
Inventory valuation
Inventory is held at the lower of cost and net realisable
value and the determination of net realisable value
involves the exercise of significant judgement.
Given the size of the inventory balance, and the level
of provisioning required, we consider the provision
calculation to be an area of material judgement. Hence
there is a risk that the inventory valuation is
inappropriate.
The group’s accounting policy for inventory is disclosed
in note 1 and the financial statements disclose further
detail concerning the group’s inventory in note 14.
Our audit procedures included:
• Assessment of decorating contracts with significant
work in progress balances to identify contracts
where significant work has been completed at the
year-end date;
• Review of invoices raised post year to identify
contracts where significant work has been
completed at the year-end date in order to inform
our conclusions on the work completed at the
year-end date; and
• Selection of a sample of contracts and agreeing the
details of these transactions to the underlying
contractual
information or other supporting
documentation which demonstrated the timing of
when obligations under the contract had been
fulfilled.
Our audit procedures included:
• Challenging the appropriateness of management’s
assumptions within the provision calculation,
including reviewing the level of historic stock write
offs;
• Obtaining management’s calculations and re-
calculating the provision value; and
• Testing the amounts included in the provision on a
sample basis.
Our application of materiality
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of
misstatements. For planning, we consider materiality to be the magnitude by which misstatements, including
omissions, could influence the economic decisions of reasonable users that are taken on the basis of the financial
statements. In order to reduce to an appropriately low level the probability that any misstatements exceed
materiality, we use a lower materiality level, performance materiality, to determine the extent of testing needed.
Importantly, misstatements below these levels will not necessarily be evaluated as immaterial as we also take
account of the nature of identified misstatements, and the particular circumstances of their occurrence, when
evaluating their effect on the financial statements as a whole.
Level of materiality applied and rationale
We consider Adjusted Profit Before Tax, excluding the impact of gains or losses arising on foreign exchange
hedging contracts, to be the most appropriate performance measure for the basis of materiality in respect of the
audit of the group as this measure reflects the group’s underlying trading profitability. Adjusted Profit Before Tax is
calculated for this purpose as Net Income for the Year Before Taxes adjusted for gains or losses on foreign currency
hedging contracts. Using this benchmark, we set materiality at £450k (2017: £500k) being 7.9% of Adjusted Profit
Before Tax (2017: 10% of Adjusted Profit Before Tax).
Materiality in respect of the audit of the parent company has been set at £350k based on the net assets of the
company, capped at 78% of group materiality.
Performance materiality was set at 75% (2017: 75%) of materiality. In setting the level of performance materiality
we considered a number of factors including the expected total value of known and likely misstatements (based
on past experience and other factors) and management’s attitude towards proposed adjustments.
14
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
I N D E P E N D E N T AU D I T O R S ’ R E P O RT
T O T H E M E M B E R S O F C O L E FA X G R O U P P L C ( C O N T I N U E D )
Component materiality
Where financial information from components was audited separately, component materiality levels were set for
this purpose at lower levels up to a maximum of 80% of group materiality. In the audit of each component, we
further applied a performance materiality level of 75% of the component materiality level to our testing to ensure
that the aggregation risk of errors exceeding component materiality was appropriately mitigated.
Agreement with the Audit Committee
We agreed with the Audit Committee that we would report on all differences individually in excess of £22,500
(2017: £25,000). We also report to the Audit Committee on financial statement disclosure matters identified when
assessing the overall consistency and presentation of the consolidated financial statements.
An overview of the scope of our audit
We tailored the scope of our audit to ensure that enough work was performed to be able to issue an opinion on
the financial statements as a whole, whilst taking into consideration the structure of the group, the accounting
processes and controls, and the industry in which the group operates.
During the planning of our group audit we confirmed our strategy for the procedures to be performed across the
group’s three significant components. All audit work was undertaken by the group engagement team with the
exception of Cowtan and Tout Inc and Manuel Canovas SAS where we engaged with component auditors BDO
USA and BDO France. Our strategy is summarised as follows:
Total revenue
Adjusted Profit before tax
1%
Total Assets
2%
48%
52%
48%
51%
39%
59%
Full scope audit – other BDO member firms
Full scope audit – BDO UK
BDO UK limited scope review
In relation to the component auditor’s work on the above mentioned overseas components, we determined the
level of involvement required by us to determine whether sufficient appropriate audit evidence had been
obtained. We discussed the planned procedures ahead of the audit, examined the conduct, results and findings
of their audits and discussed and challenged the findings of their audits.
Other information
The directors are responsible for the other information. The other information comprises the information included
in the annual report and accounts, other than the financial statements and our auditor’s report thereon. Our
opinion on the financial statements does not cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial statements or our
knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to determine whether there is a material
misstatement in the financial statements or a material misstatement of the other information. If, based on the work
we have performed, we conclude that there is a material misstatement of this other information, we are required
to report that fact. We have nothing to report in this regard.
15
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
I N D E P E N D E N T AU D I T O R S ’ R E P O RT
T O T H E M E M B E R S O F C O L E FA X G R O U P P L C ( C O N T I N U E D )
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
• the information given in the strategic report and the directors’ report for the financial year for which the
financial statements are prepared is consistent with the financial statements; and
• the strategic report and the directors’ report have been prepared in accordance with applicable legal
requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment
obtained in the course of the audit, we have not identified material misstatements in the strategic report or the
directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
• adequate accounting records have not been kept by the parent company, or returns adequate for our audit
have not been received from branches not visited by us; or
• the parent company financial statements are not in agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement as set out on page 12, the directors are
responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view,
and for such internal control as the directors determine is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the group’s and the parent
company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent
company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with ISAs (UK) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial
Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s
report.
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Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
I N D E P E N D E N T AU D I T O R S ’ R E P O RT
T O T H E M E M B E R S O F C O L E FA X G R O U P P L C ( C O N T I N U E D )
Use of our report
This report is made solely to the parent company’s members, as a body, in accordance with Chapter 3 of Part 16
of the Companies Act 2006. Our audit work has been undertaken so that we might state to the parent company’s
members those matters we are required to state to them in an auditor’s report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the parent
company and the parent company’s members as a body, for our audit work, for this report, or for the opinions we
have formed.
Anthony Perkins (Senior Statutory Auditor)
For and on behalf of BDO LLP, Statutory Auditor
London, United Kingdom
25 July 2018
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
17
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
G R O U P I N C O M E S TAT E M E N T
For the year ended 30 April 2018
Notes 2018 2017
£’000 £’000
Revenue 3 86,052 80,475
Cost of sales 39,811 36,119
Gross profit 46,241 44,356
Operating expenses 5 41,520 41,419
Profit from operations 6 4,721 2,937
Finance income 8 1 1
Finance expense 8 (3) (1)
Profit before taxation 4,719 2,937
Tax expense
– UK (508) 39
– Overseas (379) (1,081)
9 (887) (1,042)
Profit for the year attributable to
equity holders of the parent 3,832 1,895
Basic earnings per share 11 38.1p 18.6p
Diluted earnings per share 11 38.1p 18.6p
The notes on pages 25 to 43 form part of these Consolidated financial statements.
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Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
G R O U P S TAT E M E N T O F C O M P R E H E N S I V E I N C O M E
For the year ended 30 April 2018
Notes 2018 2017
£’000 £’000
Profit for the year 3,832 1,895
Other comprehensive income/(expense):
Items that will not be reclassified to profit and loss:
Exchange differences on translation of foreign operations (743) 1,628
Remeasurement of defined benefit pension scheme 31 101
Tax relating to items that will not be reclassfied to profit and loss 19 76 (449)
(636) 1,280
Items that will or may be reclassified to profit and loss:
Cash flow hedges:
Gains/(losses) recognised directly in equity 210 (2,611)
Transferred to profit and loss for the year 959 2,006
Tax relating to items that will or may be reclassified to
profit and loss 19 (222) 109
947 (496)
Total other comprehensive income 311 784
Total comprehensive income for the year
attributable to equity holders of the parent 4,143 2,679
The notes on pages 25 to 43 form part of these Consolidated financial statements.
19
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
G R O U P S TAT E M E N T O F F I N A N C I A L P O S I T I O N
At 30 April 2018
Notes 2018 2017
£’000 £’000
Non-current assets:
Property, plant and equipment 12 8,692 9,669
Deferred tax asset 19 173 386
Pension asset 24 34 –
8,899 10,055
Current assets:
Inventories and work in progress 14 14,086 13,938
Trade and other receivables 15 11,130 11,805
Current corporation tax 17 – 170
Cash and cash equivalents 16 9,177 6,710
34,393 32,623
Current liabilities:
Trade and other payables 13,678 13,961
Current corporation tax 306 –
17 13,984 13,961
Net current assets 20,409 18,662
Total assets less current liabilities 29,308 28,717
Non-current liabilities:
Deferred rent 18 1,878 1,992
Deferred tax liability 19 11 734
Pension liability 24 – 55
Net assets 27,419 25,936
Capital and reserves attributable to equity
holders of the Company:
Called up share capital 21 981 1,022
Share premium account 22 11,148 11,148
Capital redemption reserve 22 1,893 1,852
ESOP share reserve 22 (113) (113)
Foreign exchange reserve 22 2,158 2,779
Cash flow hedge reserve 22 (32) (979)
Retained earnings 22 11,384 10,227
Total equity 27,419 25,936
The financial statements were approved by the Board of Directors and authorised for issue on
25 July 2018.
D. B. Green Director
R. M. Barker Director
The notes on pages 25 to 43 form part of these Consolidated financial statements.
Company No. 1870320
20
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
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COLEFAX GROUP PLC
C O M PA N Y S TAT E M E N T O F F I N A N C I A L P O S I T I O N
At 30 April 2018
Notes 2018 2017
£’000 £’000
Non-current assets:
Investments 13 26,443 27,093
Current assets:
Trade and other receivables 15 5,214 3,941
5,214 3,941
Current liabilities:
Trade and other payables 17 1,719 2,507
Net current assets 3,495 1,434
Net assets 29,938 28,527
Capital and reserves attributable to equity
holders of the Company:
Called up share capital 21 981 1,022
Share premium account 22 11,148 11,148
Merger reserve 22 10,762 10,762
Capital redemption reserve 22 1,893 1,852
Retained earnings 22 5,154 3,743
Total equity 29,938 28,527
The Company profit for the year was £4,071,000 (2017 – £1,727,000). Total comprehensive
income relating to the year for the Company consists of the profit for the year only.
The financial statements were approved by the board of directors and authorised for issue on
25 July 2018.
D. B. Green Director
R. M. Barker Director
The notes on pages 25 to 43 form part of these Consolidated financial statements.
Company No. 1870320
21
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 22
COLEFAX GROUP PLC
G R O U P S TAT E M E N T O F C A S H F L O W S
For the year ended 30 April 2018
Notes 2018 2017
£’000 £’000
Operating activities
Profit before taxation 4,719 2,937
Finance income (1) (1)
Finance expense 3 1
Loss on disposal of property, plant and equipment 235 –
Depreciation 12 2,735 2,720
Cash flows from operations before changes in working capital 7,691 5,657
Increase in inventories and work in progress (301) (1,140)
Decrease/(increase) in trade and other receivables 463 (2,172)
Increase in trade and other payables 1,056 1,835
Cash generated from operations 8,909 4,180
Taxation paid
UK corporation tax paid (350) (224)
Overseas tax paid (679) (1,141)
(1,029) (1,365)
Net cash inflow from operating activities 7,880 2,815
Investing activities
Payments to acquire property, plant and equipment 12 (2,382) (4,126)
Receipts from sales of property, plant and equipment 49 40
Interest received – 1
Net cash outflow from investing (2,333) (4,085)
Financing activities
Purchase of own shares 21 (2,172) (2,583)
Interest paid (3) (1)
Equity dividends paid 10 (488) (478)
Net cash outflow from financing (2,663) (3,062)
Net increase/(decrease) in cash and cash equivalents 2,884 (4,332)
Cash and cash equivalents at beginning of year 6,710 10,085
Exchange (losses)/gains on cash and cash equivalents (417) 957
Cash and cash equivalents at end of year 16 9,177 6,710
The notes on pages 25 to 43 form part of these Consolidated financial statements.
22
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 23
COLEFAX GROUP PLC
C O M PA N Y S TAT E M E N T O F C A S H F L O W S
For the year ended 30 April 2018
Notes 2018 2017
£’000 £’000
Operating activities
Profit before taxation 4,219 1,727
Dividend income for the year (4,103) (1,598)
Finance income (133) (146)
Cash flows from operations before changes in working capital (17) (17)
Increase in trade and other receivables (937) (152)
Increase/(decrease) in trade and other payables 15 (807)
Cash consumed by operations (939) (976)
Taxation paid
UK corporation tax paid (350) (224)
Net cash outflow from operating activities (1,289) (1,200)
Investing activities
Interest received 499 146
Loan payment received from subsidiary 650 –
Dividends received from subsidiaries 3,603 2,300
Net cash inflow from investing 4,752 2,446
Financing activities
Purchase of own shares 21 (2,172) (2,583)
Equity dividends paid 10 (488) (478)
Net cash outflow from financing (2,660) (3,061)
Net increase/(decrease) in cash and cash equivalents 803 (1,815)
Cash and cash equivalents at beginning of year (2,492) (677)
Cash and cash equivalents at end of year 16 (1,689) (2,492)
The notes on pages 25 to 43 form part of these Consolidated financial statements.
23
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 24
COLEFAX GROUP PLC
G R O U P S TAT E M E N T O F C H A N G E S I N E Q U I T Y
For the year ended 30 April 2018
Cash
Share Capital ESOP Foreign flow
Share premium redemption share exchange hedge Retained Total
capital account reserve reserve reserve reserve earnings equity
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
At 1 May 2017 1,022 11,148 1,852 (113) 2,779 (979) 10,227 25,936
Profit for the year – – – – – – 3,832 3,832
Foreign exchange – – – – (743) – – (734)
Remeasurement of defined benefit
pension scheme – – – – – – 31 31
Cash flow hedges:
Gains – – – – – 210 – 210
Transfers – – – – – 959 – 959
Tax on other
comprehensive income – – – – 122 (222) (46) (146)
Total comprehensive
income for the year – – – – (621) 947 3,817 4,143
Share buybacks (41) – 41 – – – (2,172) (2,172)
Dividends paid – – – – – – (488) (488)
At 30 April 2018 981 11,148 1,893 (113) 2,158 (32) 11,384 27,419
At 1 May 2016 1,076 11,148 1,798 (113) 1,559 (483) 11,333 26,318
Profit for the year – – – – – – 1,895 1,895
Foreign exchange – – – – 1,628 – – 1,628
Remeasurement of defined benefit
pension scheme – – – – – – 101 101
Cash flow hedges:
Losses – – – – – (2,611) – (2,611)
Transfers – – – – – 2,006 – 2,006
Tax on other
comprehensive income – – – – (408) 109 (41) (340)
Total comprehensive
income for the year – – – – 1,220 (496) 1,955 2,679
Share buybacks (54) – 54 – – – (2,583) (2,583)
Dividends paid – – – – – – (478) (478)
At 30 April 2017 1,022 11,148 1,852 (113) 2,779 (979) 10,227 25,936
C O M PA N Y S TAT E M E N T O F C H A N G E S I N E Q U I T Y
For the year ended 30 April 2018
Share Capital
Share premium Merger redemption Retained Total
capital reserve reserve reserve earnings equity
£’000 £’000 £’000 £’000 £’000 £’000
At 1 May 2017 1,022 11,148 10,762 1,852 3,743 28,527
Profit and total comprehensive income for the year – – – – 4,071 4,071
Share buybacks (41) – – 41 (2,172) (2,172)
Dividends paid – – – – (488) (488)
At 30 April 2018 981 11,148 10,762 1,893 5,154 29,938
At 1 May 2016 1,076 11,148 10,762 1,798 5,077 29,861
Profit and total comprehensive income for the year – – – – 1,727 1,727
Share buybacks (54) – – 54 (2,583) (2,583)
Dividends paid – – – – (478) (478)
At 30 April 2017 1,022 11,148 10,762 1,852 3,743 28,527
The notes on pages 25 to 43 form part of these Consolidated financial statements.
24
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 25
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
1. Accounting policies General Information
Colefax Group Plc is a public limited company (Company No. 1870320) incorporated and domiciled
in England and Wales and listed on the Alternative Investment Market. The principal activity of the
Company is to act as a holding company for the Group’s trading subsidiaries. The address of its
registered office and principal place of business are disclosed on page 8. The principal activities of the
Group are the design, marketing, distribution and retailing of furnishing fabrics, wallpapers, trimmings,
related products and upholstered furniture in the UK and overseas and the sale of antiques, interior and
architectural design, project management, decorating and furnishing for private individuals and
commercial firms.
Basis of Preparation
The principal accounting policies adopted in the preparation of the financial statements are set out
below. The policies have been consistently applied to all the years presented, unless otherwise stated.
The policies have been applied to the Group and Company, unless otherwise stated.
These financial statements have been prepared in accordance with International Financial Reporting
Standards (IFRSs and IFRIC interpretations) issued by the International Accounting Standards Board
(IASB) as adopted by the European Union (“EU adopted IFRS”) and with those parts of the Companies
Act 2006 applicable to companies preparing their financial statements in accordance with IFRS.
Changes in Accounting Policies
There has been no significant impact on the consolidated results or financial position of the group, as a
result of new standards and interpretations issued by the IASB or the International Financial Reporting
Interpretations Committee (IFRIC) becoming effective for the first time in the current financial year.
The following standards and interpretations issued by the IASB or IFRIC have not been adopted by the
Group as these are not effective for the current year. The Group is currently assessing the impact these
standards and interpretations will have on the presentation of its consolidated results in future periods:
– IFRS 15 ‘Revenue from Contracts with Customers’ (effective for accounting periods beginning on or
after 1 January 2018). This standard is intended to clarify the principles of revenue recognition and
establish a single framework for revenue recognition. The core principle is that an entity should
recognise revenue to depict the transfer of promised goods or services to customers in an amount that
reflects the consideration to which the entity expects to be entitled in exchange for those goods or
services. This amendment has been endorsed for use in the EU.
– Amendment to IFRS 15 ‘Revenue from Contracts with Customers.’ This clarification has not yet been
endorsed for use in the EU.
– IFRS 9 ‘Financial Instruments’ (effective for accounting periods beginning on or after 1 January 2018).
– This standard replaces IAS 39 Financial Instruments: Recognition and Measurement in its entirety,
using a single approach to determine whether a financial asset is measured at amortised cost or fair
value, replacing the many different rules in IAS 39. The approach in IFRS 9 is based on how an entity
manages its financial instruments and the contractual cash flow characteristics of the financial assets,
including the introduction of an expected credit loss method for financial assets. The recognition and
de-recognition requirements for financial assets and financial liabilities are unchanged from IAS 39.
The new hedge accounting model is more principles-based, less complex and allows entities to apply
hedge accounting more broadly to manage profit and loss mismatches, and as a result reduce
‘artificial’ hedge ineffectiveness that can arise under IAS 39. This standard has been endorsed for use
in the EU.
– IFRS 16 ‘Leases’ (effective for accounting periods beginning on or after 1 January 2019). This standard
sets out the principles for the recognition, measurement, presentation and disclosure of leases for both
parties to a lease contract. The IFRS eliminates the classification of leases as either operating or finance
as required by IAS 17, and instead introduces a single lessee accounting model. This standard has not
yet been endorsed for use in the EU.
The Group considers that the implementation of IFRS 9 and 15 will not have a material impact on the
Group’s financial statements. The Group has a significant number of property leases and therefore IFRS
16 will have a material impact on the Group’s financial statements. The Group is still evaluating the
extent of the impact of IFRS 16.
25
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 26
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
1. Accounting policies The following principal accounting policies have been applied consistently in the preparation of the
continued financial statements:
Basis of Consolidation
Where the Company has control over an investee, it is classified as a subsidiary. The Company controls
an investee if all three of the following elements are present: power over the investee, exposure to
variable returns from the investee, and the ability of the Company to use its power to affect those
variable returns. The consolidated financial statements present the results of Colefax Group Plc and its
subsidiaries as if they formed a single entity.
No income statement is presented for the Company as provided in S.408 of the Companies Act 2006.
Business combinations are accounted for using the acquisition method. Under the acquisition method
the results of subsidiary undertakings are included from the date of acquisition.
Where merger accounting was used in business combinations prior to 1 May 2006 (transition date),
the investment is still recorded in the Company’s statement of financial position at the nominal value of
the shares issued, together with the fair value of any additional consideration paid as the Group has
applied the IFRS 1 ‘First-time Adoption of International Financial Reporting Standards’ exemption
relating to business combinations.
In the Group Financial Statements, merged subsidiary undertakings are treated as if they had always
been a member of the Group. Any difference between the nominal value of the shares acquired by the
Group and those issued by the company to acquire them is taken to reserves.
Goodwill
Goodwill arising on acquisitions prior to 30 April 1998 was set off directly against reserves. Goodwill
previously eliminated against reserves has not been reinstated upon transition to IFRS.
Investments in Subsidiaries
Investments in subsidiaries in the Company statement of financial position are stated at cost less any
provision for impairment.
Revenue Recognition
Revenue, which excludes value added taxes, represents the amounts receivable from customers for
goods and services supplied including disbursements net of rebates and discounts provided. Sales of
goods are recognised when goods are delivered and title has passed. Revenue for services, principally
interior design and decorating services, is recognised in the period in which they are rendered. Where
projects are ongoing at the year end, revenue is recognised on a stage of completion basis, when the
Group has a right to consideration for those services.
Property, Plant and Equipment
Property, plant and equipment are stated at historical cost less accumulated depreciation and
accumulated impairment losses. Historical cost comprises the purchase price and costs directly incurred
in bringing the asset into use. The carrying values of property, plant and equipment are reviewed for
impairment when events or changes in circumstances indicate the carrying value may not be recoverable.
Depreciation is provided on all property, plant and equipment other than freehold land at rates calculated
to write off the cost less estimated residual value evenly over its expected useful life, as follows:
Freehold property 50 years
Leasehold improvements over the shorter of the life of the lease or the life of the asset
Furniture, fixtures and equipment 5 – 10 years
Motor vehicles 4 years
Screens and originations 4 years
Inventories
Inventories are initially recognised at cost, and subsequently at the lower of cost and net realisable
value. Cost comprises all costs of purchase and other costs incurred in bringing the inventories to their
present location and condition, with the majority of inventories being valued on a weighted average cost
basis. Net realisable value represents the estimated selling price for inventories less all estimated costs of
completion and costs necessary to make the sale. Provision is made for obsolete and slow moving stocks.
26
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 27
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
1. Accounting policies Work in Progress
continued Work in progress is valued at cost less progress payments received. Cost includes all direct expenditure
on physical goods and materials acquired in advance of installation.
Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
Current Tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit reported in
the income statement because it excludes items of income or expense that are taxable or deductible in other
years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax
is calculated using tax rates that have been enacted or substantively enacted in the territories in which the
taxable income is earned by the date of the statement of financial position.
Deferred Taxation
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation of taxable profit, and is
accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised
for all taxable temporary differences, and deferred tax assets are generally recognised for all deductible
temporary differences to the extent that it is probable that taxable profits will be available against which
those deductible temporary differences can be utilised. Such assets and liabilities are not recognised if
the temporary difference arises from goodwill or from the initial recognition (other than a business
combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the
accounting profit.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in
which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted
or substantively enacted by the date of the statement of financial position. The measurement of deferred
tax liabilities and assets reflects the tax consequences that would follow from the manner in which the
Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax
assets against current tax liabilities and when they relate to income taxes levied by the same taxation
authority and the Group intends to settle its current tax assets and liabilities on a net basis.
Current and Deferred Tax for the year
Current and deferred tax are recognised as an expense or income in the income statement, except when
they relate to items credited or debited directly to other comprehensive income or equity, in which case
the tax is also recognised directly in other comprehensive income or equity.
Lease Commitments and Incentives
Leases where substantially all of the risks and rewards incidental to ownership of a leased asset are
retained by the lessor are classified as operating leases. Payments made under operating leases are
charged to the income statement on a straight line basis over the lease term. Lease incentives and
inducements are recognised as deferred rent in current and non-current liabilities as appropriate and
released on a straight line basis over the lease term.
Retirement Benefits
Defined Contribution Schemes
The Group operates defined contribution pension schemes which are externally administered. Payments
made to the funds are charged to the income statement as part of employment costs in the period to
which they relate.
Defined Benefit Schemes
One Group company operates a defined benefit pension scheme for employees. The scheme’s funds are
administered by trustees and are independent of Group finances. Annual contributions are based on
external actuarial advice. The scheme was closed to new members on 31 December 1997.
The difference between the fair value of the assets held in the Group’s defined benefit pension scheme
and the scheme’s liabilities measured on an actuarial basis using the projected unit credit method are
recognised in the Group’s statement of financial position as a pension asset or liability as appropriate.
Any related deferred tax is recognised within the Group’s deferred tax asset or liability following the
principles described in the deferred tax accounting policy note.
27
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 28
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
1. Accounting policies Changes in the defined benefit pension scheme asset or liability arising from actuarial gains and losses
continued in scheme liabilities and the movements on the valuation of scheme assets are recognised in the
Statement of comprehensive income.
Foreign Currency
The individual financial statements of each Group entity are presented in the currency of the primary
economic environment in which the entity operates (its functional currency). For the purpose of the
consolidated financial statements, the results and financial position of each Group entity are expressed
in Great British Pounds (‘GBP’), which is the functional currency of the Company and the presentation
currency for the consolidated financial statements.
Group
The assets and liabilities of overseas subsidiary undertakings are translated at the rate of exchange ruling
at the date of the statement of financial position and the results of overseas subsidiaries are translated at
the average rate of exchange for the year. The exchange differences arising on the retranslation of
opening net assets and on loans which form part of the net investment are recognised in the Statement
of other Comprehensive Income and taken to translation reserves. Loans are designated as part of the
net investment, when settlement is neither planned nor likely to occur in the foreseeable future.
Company and all subsidiaries
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies including loans to subsidiaries are retranslated at
the rate of exchange ruling at the date of the statement of financial position. All differences are taken to
the income statement.
Financial Instruments
Financial assets comprise cash and cash equivalents and trade and other receivables.
Cash and Cash Equivalents
Cash equivalents are defined as including short term deposits with original maturity within 3 months.
For the purposes of the statements of cash flow, cash and cash equivalents consist of cash and cash
equivalents net of outstanding bank overdrafts held.
Trade and Other Receivables
Trade and other receivables do not carry interest and are stated at their nominal (invoiced) value as
reduced by appropriate allowances for estimated irrecoverable amounts. When a trade receivable is
considered uncollectable, it is written off against the allowance. Subsequent recoveries of amounts
previously written off are credited against the allowance. Changes in the carrying amount of the
allowance are recognised in the income statement.
Trade and Other Payables
Trade and other payables are initially measured at fair value and subsequently at amortised cost using
the effective interest rate method.
Financial Assets and Liabilities at fair value through profit and loss
Financial assets and liabilities at fair value through profit and loss consist of a deferred compensation
plan for selected US employees. Plan assets and related liabilities are valued by reference to observable
quoted prices in active markets.
Forward Foreign Currency Contracts
The Group uses forward foreign currency contracts to hedge its risk associated with foreign currency
fluctuations. Such forward foreign currency contracts are stated at fair value which is calculated by
reference to current forward exchange rates for contracts with similar maturity profiles.
It is the Group’s policy not to hold forward foreign currency contracts for speculative purposes.
Hedge accounting can be applied to financial assets and financial liabilities only where all of the
relevant hedging criteria under IAS 39 are met. The Group accounts for forward foreign currency
contracts as a cash flow hedge. The effective part of the contracts designated as a hedge of the variability
in cash flows of foreign currency risk arising from highly probable forecast transactions, are measured
at fair value with changes in fair value recognised directly in equity (the “cash flow hedge reserve”).
28
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 29
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
1. Accounting policies The cumulative gain or loss is initially recognised in other comprehensive income and accumulated in the
continued cash flow hedge reserve. It is subsequently recycled through the consolidated income statement at the
same time as the hedged transaction affects the income statement, and reported within the cost of sales
line of the income statement. If, at any point, the hedged transaction is no longer expected to occur, the
cumulative gain or loss is recycled through the consolidated income statement immediately.
Dividends
Dividends are recognised when they become legally payable. In the case of interim dividends to equity
shareholders, this is in the year in which they are paid. Final dividends are not accrued until the
proposed dividend has been approved by the shareholders at the Annual General Meeting.
Segmental Reporting
For internal management purposes the Group reports by ‘product division’ and ‘decorating division’.
2.
Critical accounting
estimates and
judgements
In preparation of consolidated financial statements under IFRS the Group makes estimates and
assumptions regarding the future. There are considered to be no critical accounting judgements.
Estimates are continually evaluated based on historical experience and other factors, including
expectations of future events that are believed to be reasonable under the circumstances. In the future,
actual experience may differ from these estimates and assumptions. The estimates and assumptions that
have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the next financial year are discussed below.
Revenue
In the Decorating Division, the Group reviews all material contracts in progress at the year end and
accrues revenue and profit for all work completed or installed as prescribed by IAS 18. Next year the
Group will adopt IFRS 15, but the Group does not believe this will have a material impact on the
financial statements.
Inventories
The Group reviews the net realisable value of, and demand for, its inventories (see note 14) to provide
assurance that recorded inventory is stated at the lower of cost or net realisable value. Factors that could
impact estimated demand and selling prices include the success of future collections, competitor
actions, supplier prices and economic trends.
Trade Receivables
As described in note 15, the Group reviews its trade receivables to provide assurance that their carrying
value is reduced by an appropriate allowance for irrecoverable amounts. Factors which are considered
as part of that review include the age of the receivable and the creditworthiness of the customer.
Pension Assumptions
The costs, assets and liabilities of the defined benefit scheme operated by the Group are determined
using methods relying on actuarial estimates and assumptions. Details of the key assumptions are set
out in note 24. The Group takes advice from independent actuaries relating to the appropriateness of
the assumptions. Changes in the assumptions used may have a significant effect on the consolidated
income statement and the statement of financial position.
Income Taxes
The Group is subject to income tax in several jurisdictions and significant judgement is required in
determining the provision for income taxes. During the ordinary course of business, there are
transactions and calculations for which the ultimate tax determination is uncertain. As a result, the
Group recognises tax liabilities based on estimates of whether additional taxes and interest will be due,
as described in note 19. To the extent that the final tax outcome of these matters is different than the
amounts recorded, such differences will impact current and deferred tax expenses and balances in the
period in which such determination is made.
2018 2017
£’000 £’000
3. Revenue Revenue arises from:
Sale of goods 84,736 79,740
Provision of services 1,316 735
86,052 80,475
29
29
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 30
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
4. Segmental analysis The Board of Colefax Group Plc manages the operations of the Group as two divisions:
Product division – This division is involved in the design and distribution of furnishing fabrics,
wallpapers, upholstered furniture and related products;
Decorating division – This division is involved in interior and architectural design and decoration,
primarily for private individuals.
The reportable segments are distinct business units each run by a separate management team. The
financial performance of each division is reported separately to the Board and forms the basis of
strategic decision making.
Product division Decorating division Total
2018 2017 2018 2017 2018 2017
Business segments £’000 £’000 £’000 £’000 £’000 £’000
Revenue:
Total revenue 73,901 72,535 12,326 8,059 86,227 80,594
Inter-segment revenue (175) (119) – – (175) (119)
Revenue from
external customers 73,726 72,416 12,326 8,059 86,052 80,475
Segment result:
Profit from operations 3,820 2,829 901 108 4,721 2,937
Finance income 1 1 – – 1 1
Finance expense (3) (1) – – (3) (1)
Profit before taxation 3,818 2,829 901 108 4,719 2,937
Tax expense/(credit) 1,049 968 188 74 1,237 1,042
Profit for the year attributable
to equity holders of the parent 2,769 1,861 713 34 3,482 1,895
Total assets 37,126 36,303 6,167 5,819 43,293 42,122
Total liabilities 11,988 12,435 3,886 3,751 15,874 16,186
Net assets 25,138 23,868 2,281 2,068 27,419 25,936
Capital expenditure 2,067 3,133 315 993 2,382 4,126
Depreciation 2,555 2,582 180 138 2,735 2,720
No one single external customer contributes to a significant proportion of the Group’s revenues.
External revenue Non-current assets
by location of customers by location of assets
2018 2017 2018 2017
Geographical segments £’000 £’000 £’000 £’000
United Kingdom 22,131 21,019 2,746 2,705
United States 41,417 41,133 5,414 5,713
Europe 16,097 14,791 532 903
Rest of World 6,407 3,532 – –
86,052 80,475 8,692 9,321
2018 2017
£’000 £’000
5. Operating expenses Distribution and marketing costs 28,163 28,374
Administrative costs 13,357 13,045
Total operating expenses 41,520 41,419
30
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 31
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
2018 2017
£’000 £’000
6. Profit from This has been arrived at after charging/(crediting):
operations Audit services – group 47 41
Audit services – subsidiaries 122 124
Non-audit services – taxation compliance 129 93
Non-audit services – pensions 9 10
Depreciation of owned property, plant and equipment 2,735 2,720
Operating lease rentals – land and buildings 5,183 5,232
Operating lease rentals – plant and machinery 83 76
(Profit)/loss on the disposal of property, plant and equipment 235 (21)
Exchange losses 916 2,205
Pension costs (see note 24) 410 396
Compensation for surrender of Brook Street lease – (494)
Brook Street move related costs – 434
2018 2017
£’000 £’000
7. Staff costs Staff costs, including Executive Directors, were as follows:
Wages and salaries 16,279 15,745
Social security costs 1,960 1,839
Pension costs 410 396
18,649 17,980
The average monthly number of employees during the year, including Executives Directors, was made
up as follows:
No. No.
Distribution and marketing
Executive directors 2 2
Other employees 290 285
Administration
Executive directors 2 2
Other employees 53 54
347 343
The holding Company directors received their remuneration, as detailed in the Directors’ Report, from
other group companies. The holding Company had no other employees during the year (2017 – nil).
2018 2017
£’000 £’000
Directors’ (key management personnel) remuneration was as follows:
Emoluments 1,553 1,502
Pension contributions 22 23
Employers social security costs on directors’ emoluments 174 168
1,749 1,693
Emoluments of the highest paid director:
Emoluments 715 679
A full analysis of Directors’ remuneration is provided on page 10 in the Directors’ Report.
As the directors have the authority and responsibility for planning, directing and controlling the
activities of the Group they are seen to be key management.
One director participated in Group defined contribution pension schemes in 2018 (2017 – one).
No directors participated in Group defined benefit pension schemes in 2018 (2017 – nil).
No directors (2017 – nil) exercised options in the year and no options were granted to directors in the
year (2017 – nil).
31
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 32
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
2018 2017
£’000 £’000
8. Finance income and Finance expense:
expense Bank loans and overdrafts repayable within five years 3 1
Finance income:
Bank and other interest receivable 1 1
2 0
2018 2017
£’000 £’000
9. Tax expense (a) Analysis of charge for the year
UK corporation tax
UK corporation tax on profits of the year 535 (97)
Adjustments in respect of previous years – 13
535 (84)
Overseas tax
Overseas tax on profits of the year 988 1,123
Adjustments in respect of previous years (14) (7)
974 1,116
Total current tax 1,509 1,032
UK deferred tax
Origination and reversal of temporary differences (20) 32
Adjustments in respect of previous years (7) 13
(27) 45
Overseas deferred tax
Origination and reversal of temporary differences (245) (35)
Impact of overseas tax rate changes (350) –
(595) (35)
Total deferred tax (622) 10
Total income tax expense 887 1,042
(b) Factors affecting the tax charge for the year
The tax assessed for the year is higher than the standard rate of corporation tax in the UK.
The differences are explained below.
2018 2017
£’000 £’000
Profit before taxation 4,719 2,937
Profit before taxation multiplied by the standard rate of
corporation tax in the UK of 19% (2017 – 19.92%) 897 585
Effect of:
Disallowed expenses and non-taxable income 33 (58)
Adjustments in respect of prior period (current tax) (14) 6
Adjustments in respect of prior period (deferred tax) (7) 13
Rate differences (22) 496
Total tax expense 887 1,042
32
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 33
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
1 April 2014, the UK corpo 2018 2017
£’000 £’000
10. Dividends Final (paid) of 2.5p (2016 – 2.4p) on 10 October 2017 254 244
Interim (paid) of 2.4p (2017 – 2.3p) on 9 April 2018 234 234
488 478
Final dividend proposed for the year of 2.6p (2017 – 2.5p) 252 254
The proposed final dividend has not been accrued for because the dividend was declared after the
year end and is yet to be approved at the Annual General Meeting.
11. Earnings per share Basic earnings per share have been calculated on the basis of profit on ordinary activities after tax of
£3,832,000 (2017 – £1,895,000) and on 10,067,216 (2017 – 10,185,206) ordinary shares, being the
weighted average number of ordinary shares in issue during the year. Shares owned by the Colefax
Group Plc Employees’ Share Ownership Plan (ESOP) Trust are excluded from the basic earnings per
share calculation.
Diluted earnings per share have been calculated on the basis of profit on ordinary activities after tax of
£3,832,000 (2017 – £1,895,000) and on 10,067,216 (2017 – 10,185,206) being the weighted average
number of shares in issue during the year.
33
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 34
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
Furniture,
fixtures Screens
Freehold Leasehold and Motor and
property improvements equipment vehicles originations Total
£’000 £’000 £’000 £’000 £’000 £’000
12. Property, plant and Group
equipment Cost:
At 1 May 2017 240 9,735 6,668 422 11,294 28,359
Exchange adjustment – (454) (154) – (555) (1,163)
Additions _ 111 931 60 1,280 2,382
Disposals – (273) (735) (143) (5,307) (6,458)
At 30 April 2018 240 9,119 6,710 339 6,712 23,120
Depreciation:
At 1 May 2017 72 5,570 4,442 243 8,363 18,690
Exchange adjustment – (271) (155) – (398) (824)
Charge for the year 5 655 581 78 1,416 2,735
Disposals – (273) (450) (143) (5,307) (6,173)
At 30 April 2018 77 5,681 4,418 178 4,074 14,428
Net Book Value:
At 30 April 2018 163 3,438 2,292 161 2,638 8,692
At 1 May 2017 168 4,165 2,226 179 2,931 9,669
At 1 May 2016 235 8,094 5,808 385 8,990 23,512
Exchange adjustment – 808 485 – 1,120 2,413
Additions 5 1,481 1,166 124 1,350 4,126
Disposals – (648) (791) (87) (166) (1,692)
At 30 April 2017 240 9,735 6,668 422 11,294 28,359
Depreciation:
At 1 May 2016 68 5,101 4,262 240 6,290 15,961
Exchange adjustment – 494 391 – 797 1,682
Charge for the year 4 623 566 85 1,442 2,720
Disposals – (648) (777) (82) (166) (1,673)
At 30 April 2017 72 5,570 4,442 243 8,363 18,690
Net Book Value:
At 30 April 2017 168 4,165 2,226 179 2,931 9,669
At 1 May 2016 167 2,993 1,546 145 2,700 7,551
34
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 35
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
Shares Loans Total
£’000 £’000 £’000
13. Investments Company:
At 30 April 2017 19,443 7,650 27,093
Loan repayment by subsidiary – (650) (650)
At 30 April 2018 19,443 7,000 26,443
The subsidiaries of the Group, all of which have been included in these consolidated financial
statements, are as follows:
Principal
Name of Company Notes Products Registered Address
Colefax and Fowler Limited *,1 Fabrics and Wallpapers 19-23 Grosvenor Hill,
London W1K 3QD
Sibyl Colefax & John Fowler Limited *,1 Interior & Architectural 19-23 Grosvenor Hill,
Design London W1K 3QD
Kingcome Sofas Limited *,1 Upholstered Furniture 19-23 Grosvenor Hill,
London W1K 3QD
Colefax and Fowler Holdings Limited *,1 Holding Company for 19-23 Grosvenor Hill,
Colefax and Fowler Inc London W1K 3QD
Manuel Canovas Limited *,1 Dormant 19-23 Grosvenor Hill,
London W1K 3QD
Jane Churchill Limited *,1 Dormant 19-23 Grosvenor Hill,
London W1K 3QD
Colefax and Fowler Incorporated 2 Holding Company for 205, Hudson St,
Cowtan and Tout Inc New York, NY 10013
Cowtan and Tout Incorporated 2 Fabrics and Wallpapers 205, Hudson St,
New York, NY 10013
Manuel Canovas SAS 3 Fabrics and Wallpapers 23, Rue Royale,
75008 Paris
Colefax and Fowler GmbH 4 Fabrics and Wallpapers 13, Ottostrasse,
80333 Munich
Colefax and Fowler Srl 5 Fabrics and Wallpapers 8 Via Palermo,
20121 Milan
(*) Owned directly by parent company
(1)
(2)
(3)
(4)
(5)
Incorporation/Principal Country of Operation is England and Wales.
Incorporation/Principal Country of Operation is USA.
Incorporation/Principal Country of Operation is France.
Incorporation/Principal Country of Operation is Germany.
Incorporation/Principal Country of Operation is Italy.
The effective percentage of issued Share Capital held by the Group is 100% for all Group subsidiaries.
There was no movement in the number of shares held in subsidiary undertakings during the year.
At 30 April 2018, the ESOP Trust owned 60,000 (2017 – 60,000) ordinary shares of 10p in the Company
at cost, with a market value of £298,000 (2017 – £276,000). Dividends on these shares have been
waived.
The ESOP can provide benefits to all employees of the Group.
There were no shares under option in the ESOP at the date of the statement of financial position.
Group
2018 2017
£’000 £’000
14. Inventories and Finished goods for resale 13,537 13,591
work in progress Work in progress 3,015 1,072
Less: progress payments received and receivable (2,466) (725)
14,086 13,938
The cost of inventories recognised as an expense and included in cost of sales amounted to £21,873,000
(2017 – £20,948,000). The value of stock impaired/written off in the period amounted to £1,120,000
(2017 – £1,019,000).
35
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 36
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
Group Company
2018 2017 2018 2017
£’000 £’000 £’000 £’000
15. Trade and other Amounts owed by subsidiary undertakings – – 4,606 3,532
receivables Trade receivables 6,807 7,268 – –
Other receivables 2,201 2,606 326 330
Prepayments and accrued income 2,122 1,931 282 79
11,130 11,805 5,214 3,941
Trade receivables and other are considered for impairment based on a number of factors including the
age of the receivable and other factors considered to be relevant.
As at 30 April 2018 the Group had trade receivables of £2,481,000 (2017 – £2,513,000) which were
past due but not individually impaired. The ageing of these receivables is as follows:
2018 2017
£’000 £’000
Up to 3 months past due 2,053 2,191
3 to 6 months past due 258 153
6 to 12 months past due 84 107
Over 12 months past due 86 62
2,481 2,513
As at 30 April 2018 the Group had trade receivables of £392,000 (2017 – £304,000) which were past
due and individually impaired. A receivable is considered to be impaired if it is considered to be
irrecoverable. This may be due to the age of the receivable or the creditworthiness of the customer. The
ageing of these receivables is as follows:
2018 2017
£’000 £’000
Up to 3 months past due 156 103
3 to 6 months past due 39 52
6 to 12 months past due 37 8
Over 12 months past due 175 141
407 304
Movements in the Group provision for impairment of trade receivables is as follows:
2018 2017
£’000 £’000
At beginning of year 319 315
Provided during the year 191 55
Receivables written off as uncollectable (91) (51)
Unused amounts reversed (11) (17)
Exchange differences (1) 17
At end of year 407 319
The Group’s trade receivables are denominated in the following currencies:
2018 2017
£’000 £’000
Sterling 3,332 3,257
Euro 1,175 1,936
US Dollar 2,077 1,815
Other 223 260
6,807 7,268
36
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 37
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
16. Cash and cash For the purposes of the consolidated statement of cash flows, cash and cash equivalents comprise the
equivalents following:
Group Company
2018 2017 2018 2017
£’000 £’000 £’000 £’000
Cash at bank and in hand 9,177 6,710 – –
Bank overdrafts – – (1,689) (2,492)
9,177 6,710 (1,689) (2,492)
Cash at bank earns interest at floating rates based on daily bank deposit rates. The fair value of cash and
cash equivalents are considered to be their book value.
Group Company
2018 2017 2018 2017
£’000 £’000 £’000 £’000
17. Current liabilities Amounts owed to subsidiary undertakings – – – –
Bank overdraft – – 1,689 2,492
Trade payables 3,952 3,433 – –
Accruals 4,248 3,514 30 15
Payments received on account 2,073 2,559 – –
Corporation tax 306 (170) – –
Other taxes and social security costs 642 515 – –
Other payables 2,723 2,731 – –
Forward foreign currency contracts 40 1,209 – –
13,984 13,791 1,719 2,507
The Group’s overdraft facilities are secured by an unlimited multilateral company guarantee and a first
fixed and floating charge over all assets of the Company.
Group Company
2018 2017 2018 2017
£’000 £’000 £’000 £’000
18. Non-current liabilities Deferred rent 1,878 1,992 – –
Group
2018 2017
£’000 £’000
19. Deferred taxation Deferred taxation has been provided as follows:
Accelerated capital allowances on property, plant and equipment 834 1,592
Excess of depreciation over capital allowances on property, plant and equipment (56) (46)
Short-term temporary differences (940) (1,198)
(162) 348
Deferred tax assets have been recognised in respect of all tax losses and other temporary differences
where the directors believe it is probable that the assets are recoverable.
This is made up as follows:
Deferred taxation included in non-current assets (173) (386)
Deferred taxation included in non-current liabilities 11 734
(162) 348
2018 2017
Movements in the deferred tax provision is as follows: £’000 £’000
At 1 May 348 (35)
Charged to the income statement (note 9) (622) 10
Charged/(credited) directly to other comprehensive income 146 340
Translation adjustment (34) 33
At 30 April (162) 348
37
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 38
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
19. Deferred taxation The deferred income tax charged/(credited) to other comprehensive income during the year is as follows:
continued
2018 2017
£’000 £’000
Cash flow hedge reserve 222 (109)
Deferred tax on long-term loan foreign currency movements (122) 408
Deferred tax on overseas defined benefit pension scheme movements 8 41
Other movements in deferred tax 38 –
146 340
20. Financial instruments The financial instruments of the Group as classified in the financial statements as at 30 April 2018 can
be analysed under the following IAS 39 categories:
Assets at fair value Loans and
through profit or loss receivables Total
2018 2017 2018 2017 2018 2017
Group £’000 £’000 £’000 £’000 £’000 £’000
Financial assets
Trade and other receivables 1,424 1,345 7,583 8,529 9,007 9,874
Cash and cash equivalents – – 9,177 6,710 9,177 6,710
Total 1,424 1,345 16,760 15,239 18,184 16,584
Liabilities at fair value Other financial
through profit or loss liabilities Total
2018 2017 2018 2017 2018 2017
£’000 £’000 £’000 £’000 £’000 £’000
Financial liabilities
Trade and other payables 1,438 1,366 8,201 6,947 9,639 8,313
Forward foreign currency
contracts 40 1,209 – – 40 1,209
Total 1,478 2,575 8,201 6,947 9,679 9,522
The Group’s principal financial instruments comprise of cash, short-term deposits, bank overdrafts,
forward foreign currency contracts and various items such as trade and other receivables and trade and
other payables that arise directly from its operations. All trade and other payables disclosed above fall
due for payment within one year.
Forward foreign currency contracts are carried at fair value, measured using level 2 of the fair value
hierarchy. The deferred compensation plan assets and liabilities are carried at fair value, measured using
level 1 of the fair value hierarchy. The fair value hierarchy has the following levels: Level 1 – quoted
prices (unadjusted) in active markets for identical assets or liabilities; Level 2 – inputs other than quoted
prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices); and Level 3 – inputs for the asset or liability that are not based
on observable market data (unobservable inputs). The fair value of forward foreign currency contracts is
based on broker quote, derived from the quoted price of similar investments. The fair value of the
deferred compensation plan assets and liabilities is based on quoted market prices.
Financial assets and liabilities at fair value through profit and loss consist of a deferred compensation
plan for selected US employees. Plan assets and liabilities are valued by reference to observable quoted
prices in active markets.
38
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 39
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
20. Financial instruments The main risks arising from the Group’s financial instruments are liquidity risk, credit risk and foreign
continued currency risk. The Board reviews and agrees policies for managing each of these risks and they are
summarised below. These policies have remained unchanged.
Liquidity Risk
The Group’s objective is to maintain an appropriate balance between continuity of funding and
flexibility through the use of multi-currency overdrafts and bank loans. The Group has various borrowing
facilities available to it amounting to £3 million (2017 – £3.0 million). The undrawn committed facilities
available at 30 April 2018 in respect of which all conditions had been met at that date total £3 million
(2017 – £3.0 million). Group borrowing facilities are reviewed annually with HSBC.
The Group’s trade and short-term creditors all fall due within 60 days. At 30 April 2018 the Group’s
trade payables were £4.0 million (2017 – £3.4 million) and trade receivables were £6.8 million
(2016 – £7.3 million) giving a ratio of 1.7 (2017 – 2.1). This, together with the Group’s cash balances
and unused borrowing facility, constitutes a very low liquidity risk.
Credit Risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument
fails to meet its contractual obligations. The Group is mainly exposed to credit risk from credit sales. It
is Group policy, implemented locally, to assess the credit risk of new customers before entering
contracts. Such credit ratings are taken into account by local business practices.
In the Product Division credit risk is spread over a large number of customers and historically bad debt
experience has been extremely low. In the Decorating Division it is not unusual to undertake large
projects which can give rise to significant debtor balances from time to time. Risk is reduced by
requiring a 50% deposit at the start of the project and a further 25% deposit prior to completion.
Credit risk also arises from cash and cash equivalents and deposits with banks. For banks, only
independently rated parties with minimum rating “A” are accepted.
Foreign Currency Risk
Due to the international nature of its operations, the Group faces currency exposures in respect of
exchange rate fluctuations against sterling. The most significant of these is the US where revenue in US
dollars represents 48% of Group revenue.
The majority of the US subsidiary’s revenue from the sale of goods is sourced by imports from the UK
and Europe. This revenue is invoiced in US dollars. The Group minimises the currency translation
exchange risk by the use of forward foreign currency contracts. The fair value of these contracts at
30 April 2018 is detailed below.
The Group’s profit is reduced by approximately £95,000 for every one cent deterioration in the
US dollar against Sterling. The Group has a natural hedge between Euro costs and Euro revenues but
this is dependent on maintaining Euro revenue at current levels.
About 26% of Group revenue is to customers in countries other than the UK and US. Most of this
revenue is invoiced in the currencies of the countries involved. The Group does not hedge currency
exposures on this revenue using forward foreign currency contracts as any exchange rate risk is
considered to be insignificant due to the offsetting effect of imports.
The Group has continued its policy of not hedging statement of financial position translation exposures
except to the extent that overseas liabilities, including borrowings, provide a natural hedge. It is also the
Group’s policy not to hedge income statement translation exposures.
The statements of financial position of overseas operations are translated into sterling at the closing rates
of exchange for the year and any exchange difference is dealt with as a movement in the foreign
exchange reserve. The income statements of overseas business are translated at an average rate of
exchange.
Interest Rate Risk
As the Group has net cash of £9.2 million (2017 – £6.7 million) and interest rates are at historically low
levels, the Group does not consider interest rate risk to be a significant risk.
Forward Foreign Currency Contracts
The Group uses forward foreign currency contracts to forward-buy and sell foreign currency in order to
hedge future transactions and cash flows. The Group is party to forward foreign currency contracts
denominated in US dollars to eliminate transactional currency exposures on future expected revenue in
the US.
At 30 April 2018, the Group was in multiple forward foreign currency contract arrangements to sell US
dollars. The hedged transactions are expected to occur in 2018/19.
39
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 40
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
20. Financial instruments The fair value of the Group’s forward foreign currency contracts at the date of the statement of financial
continued position is as follows:
2018 2017
£’000 £’000
Fair value of forward foreign currency contracts – (liability)/asset (40) (1,209)
Capital Disclosures
The directors consider the Group’s capital to consist of its share capital and reserves.
The Group’s objective when maintaining capital is to safeguard the Group’s ability to continue as a going
concern so that it can continue to provide returns for shareholders and benefits for other stakeholders.
To the extent that the Group considers it has surplus capital it has been Group policy to return this to
shareholders through share buy backs.
Other Financial Instruments
The book amount for trade and other receivables, cash and cash equivalents, bank overdrafts, and trade
and other payables with an expected life of 12 months or less, is considered to reflect its fair value.
The financial instruments of the Company as classified in the financial statements at 30 April 2018 can
be analysed under the following IAS 39 categories:
Loans and
receivables Total
2018 2017 2018 2017
Company £’000 £’000 £’000 £’000
Financial assets
Trade and other receivables 4,932 3,862 4,932 3,862
Total 4,932 3,862 4,932 3,862
Other financial
liabilities Total
2018 2017 2018 2017
£’000 £’000 £’000 £’000
Financial liabilities
Bank overdrafts 1,689 2,492 1,689 2,492
Total 1,689 2,492 1,689 2,492
The Company acts as a holding company for the Group’s subsidiaries and does not trade. Its financial
instruments comprise cash, bank overdraft, amounts receivable and payable from subsidiary
undertakings and other receivables and payables.
The Company faces interest rate risk on its bank overdraft and liquidity risk on managing cash flows from
its subsidiary undertakings. The Company participates in a Group wide multi-currency overdraft facility
of £3.0 million (2017 – £3.0 million) which is available to the UK companies in the Group.
40
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 41
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
Allotted, called up
Authorised and fully paid
2018 2017 2018 2017
21. Share capital Ordinary shares of 10p each £3,300,000 £3,300,000 £980,700 £1,022,000
Number of shares 33,000,000 33,000,000 9,807,000 10,220,000
Allotted, called up and fully paid
2018 2018 2017 2017
Number £ Number £
Ordinary shares of 10p each
At beginning of year 10,220,000 1,022,000 10,757,000 1,075,700
Purchase of own shares for cancellation (413,000) (41,300) (537,000) (53,700)
At end of year 9,807,000 980,700 10,220,000 1,022,000
Details of share options and shareholdings of Directors are shown in the Directors’ Report on
pages 9 to 11.
Share options over the ESOP shares are shown in note 13 on page 35.
22. Reserves The following describes the nature and purpose of each reserve within owners’ equity:
Reserve Description and purpose
Share capital Amount subscribed for share capital at nominal value.
Share premium Amount subscribed for share capital in excess of nominal value.
Capital redemption Amounts transferred from share capital on redemption of issued shares.
ESOP share Weighted average cost of own shares held by the ESOP trust.
Merger Premium on shares issued to fund acquisitions prior to 1999, which was used
Retained earnings Cumulative net gains and losses recognised in the consolidated income
for write-off of goodwill on consolidation.
Foreign exchange Unrealised cumulative net gains and losses arising on the retranslation of the
Cash flow hedge Unrealised gains and losses, net of deferred tax, arising on the revaluation of
opening net assets and loans of overseas subsidiary undertakings.
statement less distributions made.
forward foreign currency contracts at the date of the statement of financial
position.
23. Commitments under At 30 April 2018 the Group had minimum lease payments under non-cancellable operating leases as
operating leases follows:
2018 2017
Land and Land and
Buildings Other Buildings Other
£’000 £’000 £’000 £’000
Within one year 4,941 46 4,992 56
Between two and five years 15,113 33 15,569 33
Over five years 10,052 – 12,410 –
30,106 79 32,971 89
The majority of leases of land and buildings are subject to rent reviews every 5 years.
41
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 42
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
24. Pension commitments Group companies make pension contributions for eligible employees to group personal pension
schemes. These schemes are independently administered. The pension cost charge represents
contributions payable by Group companies to the schemes during the year and amounted to
£410,000 (2017 – £396,000).
The Group’s US subsidiary Cowtan & Tout Incorporated operates a funded defined benefit pension
scheme. This scheme relates to the acquisition of Jack Lenor Larsen on 1 July 1997. The scheme was
closed to new members on 31 December 1997. Existing members’ current pension contributions were
transferred to a defined contribution scheme and hence all future benefits became fixed on the date the
scheme was closed. The most recent actuarial valuation of the fund was on 30 April 2016 using the
projected unit credit method. As the scheme is closed to new members and all benefits have been
frozen, assumptions concerning inflation and the rate of increase of salaries, pensions and deferred
pensions are not applicable. The rate used to discount scheme liabilities was 3.85% (2017 – 3.6%, 2016
– 3.37%). The market value of investments at 30 April 2018 was £986,000 (2017 – £1,007,000, 2016
– £851,000), all of which have an expected long term rate of return of 6.5% (2017 – 5%, 2016 – 5%).
Due to the nature of the investments, the actuarial value of the assets and the market value are the same.
The present value of scheme liabilities at 30 April 2018 was £952,000 (2017 – £1,062,000, 2016 –
£1,021,000), resulting in a net pension asset of £34,000 (2017 – (£55,000), 2016 – (£170,000)).
An asset of £34,000 (2017 – (£55,000), 2016 – (£170,000)) covering the overfunded actuarial accrued
liability is included in the Group statement of financial position together with a related deferred tax
liability of £8k (2017 – (£22,000), 2016 – (£68,000)). The expected group rebate from the scheme for
the year ended 30 April 2019 is £7,000.
The fair value of the assets in the scheme and the expected rate of return at 30 April 2018 were:
2018 2017 2016 2015 2014
£’000 £’000 £’000 £’000 £’000
Cash and cash equivalents – – – – –
Fixed income 321 196 144 137 121
Equities 665 811 707 717 641
Total market value of assets 986 1,007 851 854 762
Present value of scheme liabilities (952) (1,062) (1,021) (1,002) (879)
Net pension liability 34 (55) (170) (148) (117)
Reconciliation of plan assets:
2018 2017
£’000 £’000
At beginning of year 1,007 851
Exchange gain 37 146
Contributions by Group 50 52
Benefits paid (100) (107)
Actuarial (loss)/gain (8) 65
At end of year 986 1,007
Reconciliation of plan liabilities:
2018 2017
£’000 £’000
At beginning of year 1,062 1,021
Exchange increase (5) 147
Interest cost 35 37
Benefits paid (100) (107)
Actuarial (decrease)/increase (40) (36)
At end of year 952 1,062
42
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 43
COLEFAX GROUP PLC
N O T E S T O T H E A C C O U N T S
N O T E S T O T H E A C C O U N T S
For the year ended 30 April 2018
For the year ended 30 April 2018
24. Pension commitments History of experience gains and losses:
continued 2018 2017 2016 2015 2014
Actuarial return on scheme assets (£’000) (8) 65 (63) 20 55
As a % of plan assets -0.8% 6.8% -7.5% -2.4% 2.3%
Actuarial (increases)/reductions on scheme
liabilities (£’000) (40) 36 (36) (92) 10
As a % of plan liabilities 4.2% -2.6% 3.6% 9.0% 1.1%
25. Guarantees The Company has given an unlimited guarantee to HSBC Bank plc to secure all the present and future
indebtedness and liabilities to the Bank of the Company, Colefax and Fowler Incorporated and Cowtan
& Tout Incorporated. There is a cross guarantee between the Company and each of its UK subsidiaries
in respect of their overdraft facilities. At 30 April 2018, the value of subsidiary overdrafts covered by the
guarantee amounted to £nil (2017 – £nil).
26.
Related party
transactions
The Company undertook the following transactions with its subsidiary undertakings in the year:
2018 2017
£’000 £’000
Interest charged on long-term loans to Colefax and Fowler Holdings Limited 133 146
At the year end the following amounts were owed to/(by) the Company by/(to) its subsidiaries:
2018 2017
£’000 £’000
Colefax and Fowler Holdings Limited 7,076 8,093
Colefax and Fowler Limited 4,037 2,985
Sibyl Colefax and John Fowler Limited 493 50
Kingcome Sofas Limited – 54
11,606 11,182
The Company received dividend income from subsidiaries in the year of £4,103,000 (2017 – £1,598,000).
43
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 44
COLEFAX GROUP PLC
F I V E Y E A R R E V I E W
2018 2017 2016 2015 2014
£’000 £’000 £’000 £’000 £’000
Revenue from continuing
operations 86,052 80,475 76,879 76,796 78,035
Profit from continuing operations 4,721 2,937 5,013 5,037 4,922
Profit before taxation
from continuing operations 4,719 2,937 5,016 5,029 4,885
Profit attributable to shareholders 3,832 1,895 3,461 3,542 3,353
Basic earnings per share
from continuing operations 38.1p 18.6p 32.2p 32.2p 27.9p
Diluted earnings per share
from continuing operations 38.1p 18.6p 32.2p 32.2p 27.9p
Dividends per share 5.00p 4.80p 4.60p 4.40p 4.20p
Equity 27,419 25,936 26,318 23,757 22,211
Operating cash flow 8,909 4,180 7,195 8,741 4,867
Cash and cash equivalents 9,177 6,710 10,085 6,861 4,057
44
Job No.: 35672 Proof Event: 12
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 45
COLEFAX GROUP PLC
N O T I C E O F M E E T I N G
Notice is hereby given that the 2018 Annual General Meeting of Colefax Group Plc will be held at
19-23 Grosvenor Hill, London W1K 3QD on 13 September 2018 at 11.00 a.m. to transact the following business:
Ordinary Business
1.
To receive, and if thought fit, to adopt the audited Annual Accounts of the Company for the year ended
30 April 2018, together with the reports of the Directors and of the auditors thereon.
2.
3.
4.
5.
To declare a final dividend of 2.6p per ordinary share.
To re-appoint BDO LLP as auditors of the Company from the conclusion of this Annual General Meeting
until the conclusion of the next general meeting of the Company at which accounts are laid.
To authorise the Directors to determine the remuneration of the auditors.
To re-elect A. K. P. Smith, who retires by rotation, as a Director.
Special Business
To consider and, if thought fit, to pass the following resolutions of which resolution 6 will be proposed as an
ordinary resolution and resolution 7 will be proposed as a special resolution.
6.
THAT in place of all existing authorities (save to the extent relied upon prior to the passing of this
resolution), the Directors be generally and unconditionally authorised pursuant to section 551 of the
Companies Act 2006 (the “Act”):
(a)
(b)
to allot shares in the Company and to grant rights to subscribe for or to convert any security into
shares in the Company up to a maximum nominal amount of £326,900 for a period expiring
(unless previously renewed, varied or revoked by the Company in general meeting) at the earlier
of the date falling 15 months following the date of the Annual General Meeting and the end of
the next annual general meeting of the Company, save that the Company may before expiry of
this authority make an offer or agreement which would or might require shares to be allotted,
or rights to subscribe for or to convert any security into shares to be granted, after expiry of this
authority and the Directors may allot shares, or grant rights to subscribe for or convert any
security into shares, in pursuance of that offer or agreement as if this authority had not expired;
and
in addition, to allot equity securities (within the meaning of section 560 of the Act) in
connection with a rights issue in favour of holders of ordinary shares in proportion (as nearly as
may be) to their respective holdings of ordinary shares (but subject to such exclusions or other
arrangements as the Directors consider necessary or expedient in connection with treasury
shares, fractional entitlements or any legal or practical problems arising under the laws or
regulations of, or the requirements of any regulatory body or stock exchange in, any territory)
up to a maximum nominal amount of £326,900 for a period expiring (unless previously
renewed, varied or revoked by the Company in general meeting) at the earlier of the date falling
15 months following the date of the Annual General Meeting and the end of the next annual
general meeting of the Company, save that the Company may before expiry of this authority
make an offer or agreement which would or might require equity securities to be allotted after
expiry of this authority and the Directors may allot equity securities in pursuance of that offer
or agreement as if this authority had not expired.
7.
THAT, subject to the passing of resolution 6 above and in place of all existing powers, the Directors be
generally and unconditionally authorised pursuant to section 570 of the Act to allot equity securities
(within the meaning of section 560 of the Act) for cash pursuant to the authority granted by resolution 6
above as if section 561 of the Act did not apply to any such allotment. This power shall be limited to:
(a)
the allotment of equity securities in connection with an offer of such securities or an invitation
to apply to subscribe for such securities (whether by way of rights issue, open offer or otherwise)
in favour of holders of ordinary shares in proportion (as nearly as may be) to their respective
holdings of ordinary shares but subject to such exclusions or other arrangements as the
Directors consider necessary or expedient in connection with treasury shares, fractional
entitlements or legal or practical issues under the laws of any jurisdiction or territory or the
regulations or requirements of any regulatory or stock exchange authority in any jurisdiction or
territory; and
45
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 46
COLEFAX GROUP PLC
N O T I C E O F M E E T I N G
(b)
the allotment (other than pursuant to sub-paragraph (a) above) of equity securities up to an
aggregate nominal amount of £49,035.
This power shall expire on the earlier of the date falling 15 months following the date of the Annual
General Meeting and the conclusion of the next annual general meeting of the Company, but the
Company may before the expiry of this power make an offer or agreement which would or might require
equity securities to be allotted after expiry of this power and the Directors may allot equity securities in
pursuance of that offer or agreement as if this power had not expired.
This power also applies in relation to a sale of treasury shares, which is an allotment of equity securities
by virtue of section 560(3) of the Act as if in the first paragraph of this resolution the words “subject to
the passing of resolution 6 above” and “pursuant to the authority granted by resolution 6 above” were
omitted.
By order of the Board Registered Office
R. M. Barker BSc ACA 19-23 Grosvenor Hill
Secretary London W1K 3QD
25 July 2018
46
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
35672 R Colefax Annual Report 2018 Text.qxp_35672 R Colefax Annual Report 2018 Text 02/08/2018 12:38 Page 47
COLEFAX GROUP PLC
N O T I C E O F M E E T I N G
Notes:
1. A member entitled to attend and vote at this meeting is entitled to appoint another person as his or her proxy to exercise
all or any of his or her rights to attend, to speak and, both on a show of hands and on a poll, to vote in his or her stead at
the meeting. A proxy need not be a member of the company but must attend the meeting in person. The appointment of a
proxy does not preclude a member from attending and voting in person at the meeting should he or she subsequently decide
to do so. A form of proxy which may be used is attached.
2. A member may appoint more than one proxy in relation to a meeting, provided that each proxy is appointed to exercise
the rights attached to a different share or shares held by him or her.
3. To be valid, a form of proxy together with, if applicable, the power of attorney or other authority under which it is signed,
or a certified copy thereof, must be received by Computershare Investor Services plc at The Pavilions, Bridgwater Road,
Bristol, BS99 6ZY not later than 11.00 a.m. on 11 September 2018.
4. The company, pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001, specifies that only those
shareholders registered in the register of members of the company as at 6.00 p.m. on 11 September 2018 shall be entitled
to attend or vote (whether on a show of hands or on a poll) at the meeting in respect of the number of shares registered in
their name at the time. Changes to entries on the register after 6.00 p.m. on 11 September 2018 (or after 6.00 p.m. on the
day which is two days before any adjourned meeting) shall be disregarded in determining the rights of any person to attend
or vote at the meeting.
5. As at 24 July 2018 (being the last business day prior to the date of this notice) the company’s issued share capital consisted
of 9,807,000 ordinary shares each carrying one vote per share. Accordingly the total number of voting rights in the company
as at 24 July 2018 were 9,807,000.
6. CREST members who wish to appoint a proxy or proxies for the meeting or any adjournment thereof by utilising the CREST
electronic proxy appointment service may do so by following the procedures described in the CREST Manual
(www.euroclear.com/CREST). CREST personal members or other CREST sponsored members and those CREST members
who have appointed a voting service provider(s) should refer to their CREST sponsor or voting service provider(s), who will
be able to take the appropriate action on their behalf.
In order for a proxy appointment or instruction made by means of CREST to be valid, the appropriate CREST message
(a “CREST Proxy Instruction”) must be properly authenticated in accordance with Euroclear UK & Ireland Limited’s (EUI)
specifications and must contain the information required for such instructions, as described in the CREST Manual. The
message, regardless of whether it constitutes the appointment of a proxy or an amendment to the instruction given to a
previously appointed proxy, must, in order to be valid, be transmitted so as to be received by the issuer’s agent (ID 3RA50)
by the latest time(s) for receipt of proxy appointments specified in this notice. For this purpose, the time of receipt will be
taken to be the time (as determined by the timestamp applied to the message by the CREST Application Host) from which
the issuer’s agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time
any change of instructions to proxies appointed through CREST should be communicated to the appointee through
other means.
CREST members and, where applicable, their CREST sponsors or voting service providers should note that EUI does not
make available special procedures in CREST for any particular message. Normal system timings and limitations will
therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned
to take (or, if the CREST member is a CREST personal member or sponsored member or has appointed (a) voting service
provider(s), to procure that his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to
ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST
members and, where applicable, their CREST sponsors or voting service provider(s) are referred, in particular, to those
sections of the CREST Manual concerning practical limitations of the CREST system and timings.
The company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the
Uncertificated Securities Regulations 2001.
7. Any member attending the meeting has the right to ask questions.
8. If a shareholder has a general query about the Annual General Meeting or wishes to give the Company prior notification of
any question he wishes to ask at the Annual General Meeting, he should call our shareholder helpline on 0870 889 3295
if calling within the United Kingdom or +44 870 889 3295 if calling from outside the United Kingdom. The Shareholder
Helpline is available from 8.30 a.m. and 5.30 p.m. Monday to Friday (except public holidays). The cost of calls to the
helpline vary depending on the service provider. Calls to the helpline from outside the United Kingdom will be charged at
applicable international rates. Calls may be recorded and monitored for security and training purposes.
47
Job No.: 35672 Proof Event: 13
Customer: Colefax Group plc Project Title: Annual Report and Accounts 2018
Park Communications Ltd Alpine Way London E6 6LA
T: 020 7055 6500 F: 020 7055 6600
Park is an EMAS certified company and its Environmental Management System is certified to ISO 14001.
Printed by Park Communications on FSC® certified paper.
Head Office: 19/23 Grosvenor Hill, London W1K 3QD
Tel: 020 7493 2231 Fax: 020 7495 3123