More annual reports from Conygar Investment Company PLC:
2023 ReportThe Conygar Investment Company PLC Report and accounts 30 September 2022 Perivan 264665 The Conygar Investment Company PLC YEAR ENDED 30 SEPTEMBER 2022 SUMMARY l Net asset value (“NAV”) increased by £10.5 million to £124.6 million (208.9p per share; 2021: 217.4p per share), comprising a £10.5 million uplift from the placing of 7,138,998 of the Company’s own shares net of a £53,000 loss in the year. l NAV per share decreased by 8.5p per share as a result of issuing the placing shares. l Total cash deposits of £17.4 million (29.1p per share). l No debt and no borrowings. l A further £23.6 million was invested in The Island Quarter, Nottingham during the year, to progress the various phases of this mixed-use development. This has resulted in a valuation of £93 million, as at 30 September 2022, equating to approximately £2.5 million per acre. l Development completed, and trading commenced in September 2022, for the first phase of The Island Quarter comprising the restaurant and events venue at 1 The Island Quarter. l Construction commenced on the 693 bed The Island Quarter student accommodation development planned for completion in the summer of 2024. l Resolution passed by Nottingham City Council in May 2022 to grant planning consent for a further phase of The Island Quarter development comprising 247 build to rent apartments, 223 hotel rooms and 400 co-working desks, as well as a food and beverage provision. l Disposal of the retail park at Cross Hands, Carmarthenshire for £18.28 million to realise a £0.53m surplus over the 30 September 2021 valuation and a £0.38m profit for the year after sales costs. l Disposal of two development sites at Selly Oak, Birmingham and Parc Cybi, Holyhead completed in the year, realising a combined net profit of £3.64 million. l A further planning application was submitted in October 2021 for the proposed waterfront development in Holyhead, Anglesey, supplementing the outline consent previously granted in 2014, which includes a 250-berth marina, 259 townhouses and apartments and associated retail and public realm. Group net assets summary 30 September 2022 30 September 2021 Per share Per share £’m p £’m p Properties 110.1 184.7 108.4 206.6 Cash 17.4 29.1 13.7 26.0 Other 0.2 0.3 (0.7) (1.3) Provisions (3.1) (5.2) (7.3) (13.9) ––––––––––– ––––––––––– ––––––––––– ––––––––––– Net assets 124.6 208.9 114.1 217.4 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– 1 The Conygar Investment Company PLC Registered in England and Wales No. 04907617 CONTENTS Page Directors and advisers 3 Chairman’s & chief executive’s statement 4 Strategic report 7 Corporate governance report 15 ESG report 20 Directors’ remuneration report 24 Directors’ report 27 Independent auditor’s report 30 Consolidated statement of comprehensive income 36 Consolidated statement of changes in equity 37 Company statement of changes in equity 38 Consolidated balance sheet 39 Company balance sheet 40 Consolidated cash flow statement 41 Company cash flow statement 42 Notes to the accounts 43 Glossary of terms 63 Notice of annual general meeting 64 2 The Conygar Investment Company PLC DIRECTORS AND ADVISERS The Board of Directors N J Hamway (Non-Executive Chairman) R T E Ware (Chief Executive) D Baldwin (Finance Director) F N G Jones (Property Director) C J D Ware (Property Director) B S Sandhu (Non-Executive Director) Company Secretary D Baldwin Registered office 1 Duchess Street London W1W 6AN Auditor Solicitors Saffery Champness LLP Gowling WLG (UK) LLP 71 Queen Victoria Street 4 More London Riverside London EC4V 4BE London SE1 2AU Nominated adviser & stockbroker Registrars Liberum Capital Limited Share Registrars Limited Ropemaker Place, Level 12 3 The Millennium Centre 25 Ropemaker Street Crosby Way London EC2Y 9LY Farnham Surrey GU9 7XX Bankers Barclays Bank PLC 1 Churchill Place London E14 5HP Handelsbanken PLC 5 Wellbeck Street London W1G 9YQ The Royal Bank of Scotland PLC 36 St Andrew Square Edinburgh EH2 2YB National Westminster Bank PLC 250 Bishopsgate London EC2M 4AA Registered number 04907617 Website www.conygar.com 3 The Conygar Investment Company PLC CHAIRMAN’S & CHIEF EXECUTIVE’S STATEMENT Overview We started the year with a degree of optimism, post pandemic, but what has followed both globally and domestically has inevitably tested even the most robust and resilient of economies and companies. Against this very challenging backdrop, we have progressed realising the value from our property portfolio by way of sales and further investment, as well as advancing and sourcing additional funding to start to open up the significant opportunities offered by our mixed-use development site at The Island Quarter in Nottingham. Results summary During the year, the Group completed the sales of its industrial units at Selly Oak, Birmingham, a retail park at Cross Hands, Carmarthenshire and 2.4 acres of development land in Parc Cybi, Holyhead. The total net profits from these sales of £4 million, in addition to property revaluation surpluses of £0.3 million have been offset by property operating and administrative costs, including £1.2 million of start-up costs for the initial phase of The Island Quarter in Nottingham, to result in a net loss for the year of £53,000. The Group’s NAV increased in the year by £10.5 million as a result of placing 7.1 million of the Company’s own shares. However, the placing of these shares at a discounted price of 150p in addition to the small loss for the year has resulted in a reduction of the Group’s net asset value per share of 8.5p (3.9%) to 208.9p per share as at 30 September 2022. The property sales and share placing generated total net cash proceeds of £36.1 million in the year which have been, and continue to be, substantially utilised to progress the ongoing and anticipated future phases of The Island Quarter which was valued at £93m, by Knight Frank LLP, as at 30 September 2022. The Island Quarter, Nottingham In mid-September 2022, we were delighted to have the first of many planned developments opened to the public at 1 The Island Quarter on the north-west corner of the site, to the south of Nottingham’s historic lace market. This venue, which occupies just over 1 acre, currently comprises an outdoor performance area, an indoor event space for private hire, two dining experiences, and, in due course, a roof top terrace planned for opening next year which will provide stunning views over the city. “Binks Yard” occupies the ground floor providing an all-day, dining, drinking and entertainment venue whilst “Cleaver and Wake” offers a modern dining experience, using the finest nationally-sourced produce, with both restaurants under the leadership of Laurence Henry, the 2018 MasterChef: The Professionals winner. The strength of this development lies in the variety of the offer, incorporating not only the restaurants, but also the outside bandstand and plaza, to provide live music and events for up to 500 guests, and the upper floor events space available for private hire for a further 120 guests. All of which, we believe, provide a number of compelling reasons to visit this new destination within the city as we continue with our regeneration of the rest of the site. Whilst we are acutely aware of the current challenges faced by the hospitality industry, the initial trading performance for 1 The Island Quarter, when compared with our own forecasts, has been encouraging. In May 2022, the adjacent plot, which incorporates two hotels to be managed by Intercontinental Hotels Group, co-working space, 247 build to rent apartments, plus a food and beverage offering, was granted detailed planning permission. 4 The Conygar Investment Company PLC CHAIRMAN’S & CHIEF EXECUTIVE’S STATEMENT (continued) Construction has also commenced on the 693 bed student accommodation development, targeted for completion in the spring of 2024, with the buildings expected to be available to students for the academic year commencing in September 2024. The Group has progressed the early stages of this substantial development by utilising its existing cash deposits. Whilst we anticipate a substantial amount of the Group’s existing cash deposits will be utilised to progress the student accommodation development, we are very encouraged by the continuing positive sentiment from investors towards this asset class with demand currently outweighing the supply of stock. Furthermore, domestic student demand is at an all-time high which, coupled with the contracting supply of stock from private renters, provides an opportunity for purpose built student accommodation (“PBSA”) owners to meet that excess demand. We are currently finalising a detailed planning application, and are progressing discussions with a potential funding partner, for approximately 190,000 square feet of bioscience space on The Island Quarter and expect to submit the application in the coming weeks. The building will include both laboratory and office space, as well as conference facilities and car parking and be located adjacent to an existing bioscience hub. We continue to progress the detailed designs for subsequent phases and are in advanced discussions with potential investors in connection with further commercial and residential developments and would hope to make announcements in that respect over the coming months. Other projects At Cross Hands, Carmarthenshire, we sold our retail park in February 2022 for net proceeds of £18.3 million, to benefit from the post-pandemic bounce in retail warehousing values, generating a profit in the year of £0.4 million. Further gains of £3.5 million were recognised, by way of revaluation surpluses, in prior periods which, in addition to £1.1 million of post development rental surpluses, has resulted in a total profit from the park of £5.0 million. The granting, by Birmingham City Council, of their consent to a student home scheme at our site at Selly Oak, Birmingham enabled completion of the sale to a specialist provider of student accommodation for gross proceeds of £7.0 million. The sale realised a profit in the year of £3.4 million. At Holyhead Waterfront, Anglesey, the detailed application and marine licence applications, submitted in October 2021, for a proposed development to include a 250-berth marina, 259 townhouses and apartments, marine commercial and additional A1/A3 retail units, were validated in January 2022. The determination of this application has been delayed by a lack of available planning officers, but is now progressing and we expect it to be considered by the planning committee early in 2023. We continue to hold substantial plots of land at Rhosgoch and Parc Cybi on Anglesey. During the year we achieved a sale of 2.4 acres of the land at Parc Cybi for a net consideration of £0.3m, realising a profit over cost of £0.2 million. There has also been further interest from the renewables sector, in particular for the site at Rhosgoch. However, we will continue to retain these sites and wait to see whether the UK and Welsh Government’s announcements earlier this year, for their suggested support of nuclear and / or other energy forms on Anglesey, actually translate to a full commitment. At Haverfordwest in Pembrokeshire, where we have outline consent for 729 residential units and 90,000 square feet of implemented A1 retail, we completed construction of a 300-metre spine road and associated infrastructure in the year and are progressing discussions for the possible sale of the whole site or individual plots and hope to make further announcements in that regard later this year. 5 The Conygar Investment Company PLC CHAIRMAN’S & CHIEF EXECUTIVE’S STATEMENT (continued) ESG Vision The Board acknowledges the important role and impact that it, and the wider real estate sector, has in connection with Environmental, Social and Governance (“ESG”) matters. As such, we have included for the first time in this Annual Report, on pages 20 to 23, the Board’s vision and approach to ESG. Dividend The Board recommends that no dividend is declared in respect of the year ended 30 September 2022. More information on the Group’s dividend policy can be found within the strategic report on page 10. Share buy back authority The Board will seek to renew the buy back authority of 14.99% of the issued share capital of the Company at the forthcoming AGM as we consider the buy back authority to be a useful capital management tool and will continue to use it, as our cash flows allow, when we believe the stock market value differs too widely from our view of the intrinsic value of the Company. Outlook The repercussions from the ongoing macroeconomic and geo-political uncertainty will inevitably have a significant impact on the Group’s ability to raise finance for, and realise value from, its real estate portfolio in the near term. Furthermore, sustained inflation, as a result of the combined effects from commodity and supply chain shortages, liberal government spending and tight labour markets, compounded by the Russian invasion of Ukraine, has inevitably resulted in an acceleration of the Bank of England’s monetary policy tightening and subsequent expansion of commercial property yields. Whilst we cannot isolate ourselves from the consequences of this market uncertainty, we will continue to cautiously move our development programme forward with a particular focus on the targeted and efficient use of the Group’s existing and anticipated cash deposits. This will include the further advancement of the detailed designs and planning submissions for The Island Quarter, in order that the Group is well positioned to take advantage of these opportunities as and when our cash flows and market sentiment allows. N J Hamway Chairman 21 November 2022 R T E Ware Chief Executive 6 The Conygar Investment Company PLC STRATEGIC REPORT The Group’s strategic report provides a review of the business for the financial year, discusses the Group’s financial position at the year end and explains the principal risks and uncertainties facing the business and how we manage those risks. We also outline the Group’s strategy and business model. Strategy and business model The Conygar Investment Company PLC (“Conygar”) is an AIM quoted property investment and development group dealing in UK property. Our aim is to invest in property assets and companies where we can add significant value using our property management, development and transaction structuring skills. The business operates two major strands, being property investment and property development where we are prepared to use modest levels of gearing to enhance returns. Assets are recycled to release capital as opportunities present themselves and we will continue to buy back shares where appropriate. The Group is content to hold cash and adopt a patient strategy unless there is a compelling reason to invest. Position of the Group at the year end The Group net assets as at 30 September 2022 may be summarised as follows: Per share £’m p Properties 110.1 184.7 Cash 17.4 29.1 Other 0.2 0.3 Provisions (3.1) (5.2) ––––––––––– ––––––––––– Net assets 124.6 208.9 ––––––––––– ––––––––––– ––––––––––– ––––––––––– The Group’s balance sheet remains both liquid and robust with cash deposits at 30 September 2022 of £17.4 million and no borrowings. We have utilised part of the Group’s cash deposits, including cash generated from the share placing and property sales in the year, to complete the construction and connection of The Island Quarter electricity sub-station, to substantially complete the construction of the restaurant and events venue at 1 The Island Quarter and commence construction of the 693 bed The Island Quarter student accommodation development. However, the continuation of future phases requires us to seek either debt funding, joint venture partners or to sell assets to take best advantage of the opportunities presented by this significant development and discussions are ongoing in this regard. The Group is party to a letter of intent which provides total funding commitments of £31.2m to the contractor of the student accommodation development to enable the continued progression of its construction whilst debt financing arrangements are put into place. The Group’s commitments in this regard are expected to be ultimately financed partly out of its own cash deposits and partly from debt, for which we expect to provide a further update in the coming weeks. Key performance indicators The key measures considered when monitoring progress towards the Board’s objective of providing attractive shareholder returns include the headway made during the year on its development and investment property portfolio, the movements in net asset value per share, levels of uncommitted cash and its monitoring of and performance against its ESG targets. 7 The Conygar Investment Company PLC STRATEGIC REPORT (continued) The Chairman’s and Chief Executive’s Statement on pages 4 to 6 provides a detailed update on the progress made during the year on the Group’s property assets. Matters considered by the Audit Committee and Remuneration Committee are set out in the Corporate Governance Report on pages 15 to 19. The Board’s approach and responsibilities in connection with environmental, social and governance matters are set out in the ESG report on pages 20 to 23. The other key performance measures are considered below. Summary of investment properties 2022 2021 £’m £’m Nottingham – (1) 93.0 70.5 Cross Hands – (2) – 17.8 ––––––––––– ––––––––––– Total 93.0 88.3 ––––––––––– ––––––––––– ––––––––––– ––––––––––– 1 The Group’s investment in Nottingham was valued by Knight Frank LLP, in their capacity as external valuers, as at 30 September 2022 and 30 September 2021. 2 The Group’s investment in Cross Hands, which was sold in February 2022, was independently valued by Knight Frank LLP in the prior year. Summary of development projects We remain confident that there is significant upside in these projects, but this will only become evident over the medium term. 2022 2021 £’m £’m Haverfordwest 9.26 8.62 Holyhead Waterfront 5.00 5.00 Rhosgoch 2.50 2.50 Parc Cybi – (1) 0.38 0.50 Selly Oak – (1) – 3.57 ––––––––––– ––––––––––– Total 17.14 20.19 ––––––––––– ––––––––––– ––––––––––– ––––––––––– 1 The Group’s industrial units at Selly Oak and 2.4 acres of development land at Parc Cybi were sold in the year. Financial review Net asset value The net asset value increased in the year by £10.5 million to £124.6 million at 30 September 2022. The primary movements were net proceeds of £10.5 million from the placing of 7,138,998 ordinary shares, a £3.6 million profit from the sale of development properties at Selly Oak and Park Cybi, a £0.4 million profit from the sale of Cross Hands retail park and a revaluation surplus of £0.3m for The Island Quarter. These gains have been offset by £1.2 million of recruitment, training and start-up costs for 1 The Island Quarter, £2.2 million of other administrative costs, £0.3 million of development costs written off and £0.8 million of net property operating costs. Conversely, the net asset value per share has decreased in the period by 8.5p per share to 208.9p as at 30 September 2022 primarily as a result of the placing of shares at a discount to NAV, to provide additional capital to further progress The Island Quarter project in Nottingham. 8 The Conygar Investment Company PLC STRATEGIC REPORT (continued) Cash flow and financing At 30 September 2022, the Group had cash deposits of £17.4 million and no debt (2021: cash of £13.7 million and no debt). During the year, the Group generated £3.9 million of cash in its operating activities (2021: used £1.8 million). The other primary cash inflows for the year were net proceeds of £18.3 million from the sale of Cross Hands retail park and £10.5m from the placing of the Company’s own shares. These cash inflows were offset by capital costs of £30.2 million. Capital expenditure includes the construction costs and associated professional fees for the infrastructure works, 1 The Island Quarter and student accommodation developments at The Island Quarter, completion of a spine road on the residential site at Haverfordwest and statutory fees to advance the proposed development at Holyhead Waterfront. Net income from property activities 2022 2021 £’m £’m Rental and other income – (1) (0.3) 1.6 Direct property costs – (2) (1.6) (0.3) ––––––––––– ––––––––––– (1.9) 1.3 Proceeds from property sales 25.7 1.0 Cost of property sales (21.7) (0.6) ––––––––––– ––––––––––– Total net income arising from property activities 2.1 1.7 ––––––––––– ––––––––––– ––––––––––– ––––––––––– 1 Rental and other income for the year ended 30 September 2022 includes the reversal of a £1.4 million accrued rent debtor following the sales of Cross Hands and Selly Oak. This debtor arose from the even spreading of rental income, derived from operating leases, over each tenant’s respective minimum lease term after allowing for rent free periods. 2 Direct property costs include £1.2 million for the upfront consultancy, set up, recruitment, operational and administrative costs in connection with the restaurant and events venue at 1 The Island Quarter to ensure its successful opening in September 2022. Administrative expenses The administrative expenses for the year ended 30 September 2022, excluding 1 The Island Quarter, were £2.2 million (2021: £2.1 million). The major items were salary costs of £1.4 million (2021: £1.4 million), head office running costs and various costs arising as a result of the Group being listed on AIM. Taxation Current tax is payable at a rate of 19% on net rental income and profits from the sale of development properties after deduction of finance costs and administrative expenses. Deferred tax is calculated at a rate of 25%, being the rate that has been enacted or substantively enacted by the balance sheet date and which is expected to apply when the tax liability, resulting from unrealised chargeable gains arising on revaluation of the Group’s investment properties, is projected to be settled. Capital management Capital risk management The Board’s primary objective when managing capital is to preserve the Group’s ability to continue as a going concern, in order to safeguard its equity and provide returns for shareholders and benefits for other stakeholders, whilst maintaining an optimal capital structure to reduce the cost of capital. 9 The Conygar Investment Company PLC STRATEGIC REPORT (continued) As at the balance sheet date, the Group does not have any borrowings, but is expected to utilise borrowings in the future to fund development projects. When doing so the Group will seek to ensure that it can stay within agreed covenants with its lenders. Treasury policies The objective of the Group’s treasury policies is to manage the Group’s financial risk, secure cost effective funding for the Group’s operations and to minimise the adverse effects of fluctuations in the financial markets on the value of the Group’s financial assets and liabilities, reported profitability and cash flows. The Group finances its activities with a combination of cash and short term deposits. Other financial assets and liabilities, such as trade receivables and trade payables, arise directly from the Group’s operations. The Group may also finance its activities with bank loans and enter into derivative transactions to manage the interest rate risk arising from its operations and sources of finance. Throughout the year, and as at the balance sheet date, no group undertakings were party to any bank loans or derivative instruments. The management of cash is monitored weekly with summary cash statements produced on a monthly basis and discussed regularly in management and board meetings. The approach is to provide sufficient liquidity to meet the requirements of the business in terms of funding developments and potential acquisitions. Surplus funds are invested with a broad range of institutions. At any point in time, at least half of the Group’s cash is held on instant access or short term deposit of less than 30 days. Dividend policy The Board recommends that no dividend is paid in respect of the year ended 30 September 2022 (2021: £nil). Our dividend policy is consistent with the overall strategy of the business: namely to invest in property assets and companies where we can add significant value using our property management, development and transaction structuring skills. In previous years we have used the surplus cash flow from the then much larger investment property portfolio to enhance these properties by refurbishment, re-letting and extending tenancies, fund the operations of the business, create a medium term pipeline of development opportunities, pay a modest dividend and buy back shares where appropriate. The Board will continue to review the dividend policy each year. Our focus is, and will primarily continue to be, growth in net asset value per share. Share placing At the Company’s Annual General Meeting held on 20 December 2021, resolutions were passed to enable the Company to complete the placing of 7,138,998 Ordinary shares of 5p each at a placing price of 150p per share. The premium received from each placing share over their 5p nominal value, net of fees paid in connection with the placing, resulted in a £10.16 million credit to the Company’s share premium account. At a General Meeting of the Company on 28 March 2022 a further resolution was passed to enable the cancellation of the share premium account, subject to approval of the Court, such that the amount cancelled can be credited to a distributable reserve. On 22 April 2022, an application was submitted to the Court to request the cancellation which was duly confirmed by the Court on 10 May 2022 and completed on 12 May 2022. Principal risks and uncertainties Managing risk is an integral element of the Group’s management activities and a considerable amount of time is spent assessing and managing risks to the business. Responsibility for risk management rests with the Board, with external advisers used where necessary. 10 The Conygar Investment Company PLC STRATEGIC REPORT (continued) Strategic risks Strategic risks are risks arising from an inappropriate strategy or through flawed execution of a strategy that could threaten the future performance, solvency or liquidity of the Group. By definition, strategic risks tend to be longer term than most other risks and, as has been amply demonstrated in the last few years, the economic and wider environment can alter quickly and significantly. Strategic risks identified include global or national events, regulatory and legal changes, market or sector changes and key staff retention. As set out in the Chairman’s and Chief Executive’s Statement, the ongoing macroeconomic and geo-political uncertainty, in addition to sustained inflation, will inevitably have a significant impact on the Group’s ability to raise finance for, and realise value from, its real estate portfolio in the near term. The Board continually monitors and discusses the potential impact that changes to the environment in which we operate can have upon the Group. We are confident we have sufficiently high calibre Directors and managers to manage strategic risks. We are content that the Group has the right approach toward strategy and our strong balance sheet is good evidence of that. Operational risks Operational risks are essentially those risks that might arise from inadequate internal systems, processes, resources or incorrect decision making. Clearly, it is not possible to eliminate operational risk. However, by ensuring we have the right calibre of staff and external support in place we look to minimise such risks, as most operational risks arise from people-related issues. Our Executive Directors are very closely involved in the day-to-day running of the business to ensure sound management judgement is applied. Market risks Market risks primarily arise from the possibility that the Group is exposed to fluctuations in the values of, or income from, its cash deposits, investment properties and development projects. This is a key risk to the principal activities of the Group and the exposures are continuously monitored through timely financial and management reporting and analysis of available market intelligence. Where necessary, management takes appropriate action to mitigate any adverse impact arising from identified risks and market risks continue to be monitored closely. Estimation and judgement risks To be able to prepare accounts according to generally accepted accounting principles, management must make estimates and assumptions that affect the asset and liability items and revenue and expense amounts recorded in the accounts. These estimates are based on historical experience and various other assumptions that management and the Board believe are reasonable under the circumstances. The results of these considerations form the basis for making judgements about the carrying value of assets and liabilities that are not readily available from other sources. The key sources of estimation uncertainty that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year are the following: Investment properties The fair values of investment properties are based upon open market value and calculated, where applicable, using a third party valuation provided by an external valuer. Development properties The net realisable value of properties held for development requires an assessment of the value for the underlying assets using property appraisal techniques and other valuation methods. Such estimates are inherently subjective and actual values can only be determined in a sales transaction. 11 The Conygar Investment Company PLC STRATEGIC REPORT (continued) Financial assets The interest rate profile of the Group’s cash at the balance sheet date was as follows: 30 Sep 22 30 Sep 21 £’000 £’000 Floating rate 17,109 13,281 Performance bond deposits 252 376 ––––––––––– ––––––––––– 17,361 13,657 ––––––––––– ––––––––––– ––––––––––– ––––––––––– Fixed and floating rate financial assets comprise cash and short term performance bond deposits held with banks whose credit ratings are acceptable to the Board. Credit risk Credit risk is the risk of financial loss to the Group if a counterparty fails to meet its contractual obligations. The Group’s principal financial assets include its financial interest in property assets, cash deposits and trade and other receivables. The carrying amount of financial assets recorded in the financial statements represents the Group’s maximum exposure to credit risk without taking account of the value of any collateral obtained. In the event of default by an occupational tenant, the Group will suffer a rental shortfall and incur additional costs. The Directors continually monitor tenant arrears in order to anticipate, and minimise the impact of, defaults by occupational tenants and if necessary, where circumstances allow, will apply rigorous credit control procedures to facilitate the recovery of trade receivables. Under IFRS 9, the Group is required to provide for any expected credit losses arising from trade receivables. For all assured shorthold tenancies, credit checks are performed prior to acceptance of the tenant. Regulated tenants are incentivised through the benefit of their tenancy agreement to avoid default on their rent and rent deposits are held where applicable. Taking these factors into account, the risk to the Group of individual tenant default and the credit risk of trade receivables are considered low, albeit that risk increased as a result of the impact of COVID-19, as is borne out by the level of trade receivables written off in the current and prior years. The Directors have provided for rental and other arrears due from various tenants impacted by, amongst other factors, the economic downturn and COVID-19 pandemic which amount to £200,000 at 30 September 2022 and which remain outstanding at the date of signing these financial statements. The movement in the bad debt provision during the year is set out on page 61. The impaired receivables are based on a review of expected credit losses. Impaired receivables and receivables not considered to be impaired are not material to the financial statements and, therefore, no further analysis is provided. The credit risk on cash deposits is managed through the Company’s policies of monitoring counterparty exposure and the use of counterparties of good financial standing. At 30 September 2022, the credit exposure from cash held with banks was £17.4 million which represents 13.9% of the Group’s net assets. All cash deposits at the balance sheet date are placed with banks, whose credit ratings are acceptable to the Board, on instant access accounts. Should the credit quality or the financial position of the banks currently utilised significantly deteriorate, cash deposits would be moved to alternative banks. Liquidity risk Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group seeks to manage its liquidity risk by ensuring that sufficient cash is available to meet its foreseeable needs. The Group has cash deposits at the balance sheet date of £17.4 million. However, we will need to raise substantial amounts either as debt, or through joint ventures or further asset sales, in order to significantly progress The Island Quarter development in Nottingham and expect to make announcements in that respect over the coming months. 12 The Conygar Investment Company PLC STRATEGIC REPORT (continued) Section 172 statement Directors’ duty to promote the success of the Company under Section 172 Companies Act 2006 The strategic report is required to include a statement that describes how the Directors have had regard to the matters set out in section 172(1) (a) to (f) of the Companies Act 2006 when performing their duty under section 172. Some of the matters identified in Section 172(1) are already covered by similar provisions in the QCA Code and have thus been previously reported by the Company in the corporate governance statement, the corporate governance report and the QCA statement of compliance on our website. In order to avoid unnecessary duplication, the relevant parts of those documents are identified below and are to be treated as expressly incorporated by reference into this strategic report. Under section 172 (1) of the Companies Act 2006, each individual Director must act in the way he considers, in good faith, would be the most likely to promote the success of the Company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to six matters detailed in the section. In discharging their duties, the Directors seek to promote the success of Conygar for the benefit of members as a whole and have regard to all the matters set out in Section 172(1), where applicable and relevant to the business, taking account of its size and structure and the nature and scale of its activities in the commercial property market. The following paragraphs address each of the six matters in Section 172(1) (a) to (f). (a) The likely consequences of any decision in the long term: The commercial property market is cyclical by nature. Investing in commercial property is a long term business. The decisions taken must have regard to long term consequences in terms of success or failure and managing risks and uncertainties. The Directors cannot expect that every decision they take will prove, with the benefit of hindsight, to be the best one - external factors may affect the market and thus change conditions in the future, after a decision has been taken. However, the Group’s investment decisions are undertaken by a Board with a wide range of experience, over many years, in both the property and finance sectors. (b) The interests of the Company’s and Group’s employees: The Company has five full time employees, including the Chief Executive, two Property Directors and the Finance Director. These Executive Directors sit on the Board with the Non-Executive Directors. The Group also has a growing workforce to support its operations at The Island Quarter, all of which are employed by a wholly-owned group company. The commitment of the Board to its employees is set out in the ESG Report on page 22 of this Annual Report. (c) The need to foster the Company’s business relationships with suppliers, customers and others: The Directors have regularly reported in the Company’s annual reports on the constructive relationships that Conygar seeks to build with its tenants and the mutual benefits that this brings to both parties; and this reporting has been extended over the past two years following Principle 3 of the QCA Code to include suppliers and others. This is therefore addressed under Principle 3 in the QCA compliance statement. In recent years, it has been vital to foster our business relationships with tenants given external factors, such as political and economic uncertainty. (d) The impact of the Company’s operations on the community and the environment: This is also addressed under Principle 3 of the QCA Code in the QCA compliance statement. Due to its size and structure and the nature and scale of its activities, the Board considers that the impact of Conygar’s operations as a landlord on the community and the environment is low. With the exception of 1 The Island Quarter, Conygar’s assets are used by its tenants for their own operations rather than by Conygar itself. In the past year, the Company has not been made aware of any tenant operations that have had a significant impact on the community or the environment. In relation to 1 The Island Quarter, as well as ongoing and future planned developments, Conygar seeks to ensure that designs and construction comply with all relevant environmental standards and with local planning requirements and building regulations so as not to adversely affect the community or the environment. Further details of which are set out in the ESG section of this Annual Report on pages 20 to 23. 13 The Conygar Investment Company PLC STRATEGIC REPORT (continued) (e) The desirability of the Company maintaining a reputation for high standards of business conduct: This is addressed under Principle 8 of the QCA Code in the corporate governance statement and in the QCA compliance statement. The Board considers that maintaining Conygar’s reputation for high standards of business conduct is not just desirable - it is a valuable asset in the competitive commercial property market. (f) The need to act fairly as between members of the Company: The Company has only one class of shares, thus all shareholders have equal rights and, regardless of the size of their holding, every shareholder is, and always has been, treated equally and fairly. Relations with shareholders are further addressed under Principles 2, 3 and 10 of the QCA Code in the corporate governance report and the QCA compliance statement. We have been reviewing how we communicate with shareholders and are encouraging shareholders to adopt electronic communications and proxy voting in place of paper documents where this suits them, as well as to raise questions in writing if they are unable to attend AGMs. This report was approved by the Board on 21 November 2022 and signed on its behalf by: R T E Ware Chief Executive 21 November 2022 14 The Conygar Investment Company PLC CORPORATE GOVERNANCE REPORT Corporate governance code The Directors consider it important that appropriately high standards of corporate governance are maintained. In compliance with the AIM rules, the Company has therefore chosen to comply with the QCA Code. The workings of the Board and its committees The Board The Board is responsible for the overall leadership of the Company, the success of the Group and is accountable to shareholders for the performance of the business. The Board comprises the Chief Executive, two Property Directors, the Finance Director and two independent Non-Executive Directors. The principal role of the Board is to set the Group’s strategy and to review regularly its performance against that agreed strategy. As set out in the biographies below, the Board members have a broad range of skills and experience which enable them to effectively carry out their corporate governance duties and responsibilities. Each member of the Board takes responsibility for maintaining his skill set, which includes roles on other boards and ongoing continued professional development. The Board directs and monitors the Group’s affairs within an evolving framework of controls which enable risk to be assessed and managed effectively. A statement of going concern and a statement of the Directors’ responsibilities in respect of the financial statements is given on pages 28 and 29. Biographies Non-Executive Chairman – Nigel Hamway Nigel Hamway qualified as a member of the Institute of Chartered Accountants in England and Wales with Peat Marwick after obtaining a degree from Cambridge University. He joined Dubilier PLC as Chief Financial Accountant, leaving to take up a position in international corporate finance at Charterhouse Bank in 1986, becoming a Director in 1990. From 1991 to 2016, he was a Director of Charterhouse Development Capital. For several years he was responsible for Charterhouse's international investment business. He has had extensive board experience in many countries and businesses. Chief Executive – Robert Ware Robert Ware qualified as a member of the Institute of Chartered Accountants in England and Wales with Peat Marwick. He served as a Director of Development Securities PLC between 1988 and 1994, filling the roles of Joint Managing Director and Finance Director in the latter stage of his tenure. He joined MEPC Plc in June 1997, serving first as Corporate Development Director and then as Deputy Chief Executive until June 2003. He is also Chairman of Marwyn Value Investors Limited which is quoted on the London Stock Exchange. Property Director – Freddie Jones Freddie Jones graduated from St Andrews University before going on to Bayes Business School where he completed an MSc in Real Estate Finance and graduated from there in 2007. He joined Conygar in 2008 and has since then managed multiple investment and development projects for the Group. 15 The Conygar Investment Company PLC CORPORATE GOVERNANCE REPORT (continued) Property Director – Christopher Ware Christopher Ware graduated from the University of Exeter before completing a Masters degree in Real Estate at Reading. He started his career at Colliers International, working in the Central London investment team and becoming a Chartered Surveyor during that time before joining Conygar in 2012. Christopher is also a CFA charterholder. Finance Director – David Baldwin David Baldwin qualified as a member of the Chartered Association of Certified Accountants in 1992. He joined Frogmore Estates PLC as a commercial and residential property accountant in 1995 before moving to Prestbury Investment Holdings Limited as Financial Controller until 2015. He then joined The Conygar Investment Company PLC, also as its Financial Controller, before being appointed Company Secretary in April 2020 and Finance Director in May 2021. Non-Executive Director – Bim Sandhu Bim Sandhu is a graduate of the LSE and was Secretary of the KPMG UK Property & Construction Group after qualification as a Chartered Accountant. He left to become Finance Director and then Managing Director of the UK operations of a client, Hudson Conway, an Australian listed developer. Bim was co-founder and CEO of UK developer Raven Mount plc and co-founder of Raven Property Group Limited, a developer of logistics warehouses, and co-founder and Chairman of Raven Audley Court plc, a developer and operator of assisted living facilities. He is currently CEO of The Santon Group and Non-Executive Director of AEW UK REIT plc and Africa Logistics Properties Holdings Limited. Workings of the Board The Board has a formal schedule of matters to consider. All Directors have access to the advice and services of the Company Secretary who is responsible to the Board for ensuring that Board procedures are followed and that applicable rules and regulations are complied with. In addition, the Company Secretary ensures that the Directors receive appropriate training as necessary. The appointment and removal of the Company Secretary is a matter for the Board as a whole. The Board met formally eight times in the year, reviewing trading performance, ensuring adequate funding, setting and monitoring strategy, examining major acquisition possibilities and reporting to shareholders. The Non-Executive Directors have a particular responsibility to ensure that the strategies proposed by the Executive Directors are fully considered. The Chairman ensures that the Directors may take independent professional advice as required at the Company’s expense. Outside of the formal meetings the Directors are in regular contact to ensure they are fully briefed with the ongoing activities of the Group and to deal with any matters, in a timely manner, as and when they arise. The outside commitments of the Non-Executive Directors are also regularly monitored to ensure they have sufficient capacity to properly consider, advise and monitor the Group’s activities. The following committees deal with specific aspects of the Group’s affairs. Remuneration committee The Company’s remuneration committee is chaired by N J Hamway and its other member is B S Sandhu. It is responsible for making recommendations to the Board, within agreed terms of reference, on the Company’s framework of executive remuneration and its cost. The committee determines the contract terms, remuneration and other benefits for each of the Executive Directors, including awards under the profit sharing plan, special discretionary and any other bonus awards, pension rights and compensation payments. The Board itself determines the remuneration of the Non-Executive Directors. The Non-Executive Directors are not involved in any discussions or decisions about their own remuneration. Further details of the Company’s policies on remuneration, service contracts and compensation payments are included in the directors’ remuneration report on pages 24 to 26. 16 The Conygar Investment Company PLC CORPORATE GOVERNANCE REPORT (continued) Audit committee The audit committee is chaired by N J Hamway and its other member is B S Sandhu, and it meets not less than twice annually. The committee also provides a forum for reporting by the Company’s external auditor. Meetings are also attended, by invitation, by the Chief Executive, the Finance Director and any relevant senior management. The audit committee is responsible for reviewing a wide range of matters including the half-year and annual financial statements before their submission to the Board and monitoring the controls which are in force to ensure the integrity of the information reported to the shareholders. The audit committee advises the Board on the appointment of external auditors and on their remuneration both for audit and non-audit work, and discusses the nature, scope and results of the audit with its external auditors. The audit committee keeps under review the cost effectiveness and the independence and objectivity of the external auditor. Key activities of the audit committee for the year under review 1. Reviewing and, where necessary, challenging the Group’s annual report and financial statements for the year ended 30 September 2022 and the unaudited interim results for the six months to 31 March 2022 to ensure they are fair, balanced and understandable for shareholders and other users of the accounts. 2. Holding committee meetings with the Group’s auditor to discuss the findings of the audit to include: l An assessment of the effectiveness of the audit process; l A review of the key accounting judgements on the financial statements; l Discussing any material issues that arose during the audit; and l Assessing the overall control environment. 3. Assessing the remuneration, independence, objectivity and effectiveness of the external auditor. 4. Reviewing the system of internal controls, fraud detection and risk management. 5. Reviewing the adequacy and security of the Company’s arrangements for whistleblowers to raise concerns about possible wrongdoing. Meetings and attendance The Directors attended the following meetings during the year: Audit Remuneration Board committee committee N J Hamway 8/8 2/2 2/2 R T E Ware 8/8 – – F N G Jones 8/8 – – C J D Ware 8/8 – – B S Sandhu 8/8 2/2 2/2 D Baldwin* 8/8 2/2 – * D Baldwin was invited to attend the relevant part of the Audit committee meetings. 17 The Conygar Investment Company PLC CORPORATE GOVERNANCE REPORT (continued) Independent Non-Executive Directors Bim Sandhu became a Director of the Company in March 2020, he has been a shareholder in the Company since inception and currently holds a 7.5% interest in the shares of the Company. Bim has extensive relevant experience as a public company Director both as an Executive and as a Non-Executive Director, particularly in finance and property and has substantial stakes in a number of listed and unlisted companies. Nigel Hamway has been a Director since inception and he and his family own 2.0% of the Company’s shares. Nigel is an experienced investor and Company Director across many sectors. These Non-Executive Directors demonstrate a range of experience and sufficient calibre to bring independent judgement on issues of strategy, performance, resources and standards of conduct which are vital to the success of the Company. Furthermore, the shareholdings of both Nigel and Bim align their interest in the Company with those of shareholders and their board directorships elsewhere gives them extensive experience of ensuring that the interests of all stakeholders are considered. Bim and Nigel are not employed by the Company and only receive, from the Company, the fees as set out in the Directors’ Remuneration Report. Evaluating Board performance Assessment of the Board’s performance and that of its committees is undertaken by the Board as a whole, led by the Company’s Chairman. Although the Company has no formal procedure for measuring the effectiveness of the Board, the Board carefully reviews its effectiveness by reference to financial performance, adherence to budgets, succession planning and the overall growth of the Company and taking account of the opinions and insights of its auditor, nominated adviser, broker, legal and other advisers. The method of assessing Board effectiveness and performance will be reviewed on a continuous basis. Training and development An induction programme is arranged for newly appointed Directors which includes papers and meetings on the business, current strategy and shareholder expectations. Guidance is also given on the duties, responsibilities and liabilities of a Director of a listed company and key Board policies and procedures. Directors have access to training as required and are encouraged to continue their own professional development through attendance at seminars and briefings. Promoting ethical values and behaviours The Board is committed to ensuring that the Company operates according to the highest ethical standards for which it has primary responsibility. The Directors believe that the main determinant of whether a business behaves ethically and with integrity is the quality of its people. As the Board currently fulfils the responsibilities that might otherwise be assumed by a nominations committee, the Directors have responsibility for ensuring that individuals employed by the Company demonstrate the highest levels of integrity and undertake reviews of its employees regularly. In addition, the Company has policies for whistleblowing, bribery and anti-corruption and a share dealing code. Relations with shareholders Communications with shareholders are given high priority. The Company issues its results to shareholders promptly and also publishes them on its website. Regular updates are also provided, as required, in relation to the Group and its property portfolio. Pages 7 to 14 of these financial statements include a detailed review of the business and future developments and the Company’s website is found at www.conygar.com. The Board uses the AGM and results meetings to communicate with private and institutional investors and welcomes their participation. Details of resolutions to be proposed at the AGM on 19 December 2022 can be found in the notice of the meeting on page 64. 18 The Conygar Investment Company PLC CORPORATE GOVERNANCE REPORT (continued) Internal control The Directors acknowledge that they are responsible for the Company’s systems of internal control and for reviewing their effectiveness. The systems are designed to manage, rather than eliminate, the risk of failure to achieve the Company’s strategic objectives, and can only provide reasonable, not absolute, assurance against material misstatement or loss. The Company’s key risk management processes and systems of internal control procedures include the following: l Management structure: Authority to operate is delegated to Executive Directors within limits set by the Board. The appointment of executives to the most senior positions within the Group requires the approval of the Board. l Identification and evaluation of business risks: The major financial, commercial, legal, regulatory and operating risks within the Group are identified through annual reporting procedures. l Information and financial reporting systems: The Group's planning and financial reporting procedures include detailed operational budgets for the year ahead which are reviewed and approved by the Board. l Investment appraisal: A budgetary process and authorisation levels regulate capital expenditure. For expenditure beyond specified levels, detailed written proposals have to be submitted to the Board. Commercial, legal and financial due diligence work is, where possible, carried out if a business is to be acquired. l Audit committee: The audit committee monitors the controls which are in place and any perceived weakness in the control environment. The audit committee also considers and determines relevant action in respect of any control issues raised by the external auditor. 19 The Conygar Investment Company PLC ESG REPORT Our ESG vision To be an innovative leader in the communities in which we invest, create and operate – and to ensure we have a robust ESG programme that underpins all that we do. ESG policy At The Conygar Investment Company PLC (“Conygar”) we appreciate that our activities and services may have a direct impact on the natural, human and building environment. We aim to incorporate environmental, social and governance (“ESG”) principles in all our investment processes, our property developments and our operations, so that we can better safeguard the world in which we live, enhance our society and comply with applicable laws, regulations and other environmentally-oriented requirements. The Board is mindful of its responsibilities to all of its stakeholders, including the wider community, when it makes decisions in setting and implementing the Company’s strategy. In considering environmental responsibility, the Board has regard to climate, nature and sustainability. We want to be able to demonstrate strong governance to meet the long term interests of our investors and wider stakeholders. Alongside our fiduciary, regulatory and legal responsibilities, we are committed to ensuring that ESG is embedded across our operations and in our investment decision making process. Where appropriate, we look to align with internationally recognised standards. We have an active approach to property development and asset management of built mixed-use environments in the UK. As such, we are able to take existing assets and improve their environmental efficiency at the same time as fulfilling our financial goals. We believe our key priority ESG areas are: l Governance and disclosure l Responsible investment l Working collaboratively l Meeting our legal obligations These priority areas incorporate environmental responsibility, social responsibility and corporate governance. Our commitments l We will ensure that our property development activities integrate ESG considerations, including the effects of climate change, into the design process. l We will regularly engage on ESG with our communities, employees, tenants and business partners. l We will manage our own impact from our operations including office, travel and procurement activities and in the shared areas within the properties of our portfolio. l We will partner with key contractors to help deliver on our commitments. Our ESG goals l Develop a mechanism for estimating and understanding our greenhouse gas Scope 3 (“GHG”) emissions, as well as further documenting GHG emissions within our control, to identify potential reductions and support the development of our approach towards Carbon Neutrality. l Regularly engage our stakeholders on ESG risks and opportunities, providing support and guidance where possible, in order to create sustainable outcomes for the benefit of our stakeholders, the communities in which we operate and the environment. 20 The Conygar Investment Company PLC ESG REPORT (continued) l Seek opportunities to reduce the environmental and social impact of our developments throughout construction and their operational life and embed opportunities to enhance the surrounding environment and communities. How we apply this policy l This policy is informed and supported by Our Approach to ESG, as set out below. l The Board has responsibility for approving this policy. l This policy is included alongside our employee handbook, tenant handbook (being developed) and procurement policy to inform our tenants, business partners and staff of our commitments. l This policy is reviewed annually. How we monitor and report against this policy l We report against this policy through our Company’s Board papers and Annual Reports. l Our ESG performance reporting is readily accessible to our tenants and business partners and is also available to the public on request. We are committed to continual improvement and therefore, when weaknesses in our performance are identified, we will take action to strengthen our systems by allocating resources and responsibilities internally, or by appointing experts to provide assistance. Our approach to ESG Environment We are committed to minimising the environmental impact of our developments and to improving the resilience of our properties to the long-term impacts of climate change. As part of this we will: l where possible and within our control, ensure our developments match or exceed best practice environmental performance benchmarks; l constantly work on improving indoor environmental quality, and minimising energy and water demand and embodied carbon, investigate onsite renewable energy and promote sourcing of sustainable materials in our property acquisition and management activities; l ensure that design and management of our public realm and outdoor spaces promotes resilience to extreme weather events, helps to manage pollution such as emissions to air and provides diverse habitats for biodiversity; l design and manage our spaces to minimise and manage waste, energy and water and to help our tenants to do the same; l work with our contractors, consultants and suppliers to drive environmental performance through our procurement policy and other engagement activities; and l ensure that we consider ESG implications in all asset acquisitions and physical works including transitional and physical climate implication and actively plan to reduce environmental impact and risk through development of key performance indicators at company and asset level. 21 The Conygar Investment Company PLC ESG REPORT (continued) Social responsibility Conygar recognises that our activities create opportunities to enhance society, but also risks. We proactively manage both to ensure the best possible outcomes for our communities, employees, tenants and business partners. The Board is committed to fairness and to encouraging diversity on the Board and in its operations, including prevention of any forms of discrimination including under the terms of the Equality Act 2010. The terms of reference on the Remuneration Committee include a requirement for it to regularly review the structure, size and composition of the Board including the skills, knowledge, experience and diversity of the Directors. The Committee’s report includes commentary on its work in this respect. The Corporate Governance Report includes details of the composition of the Board, including a description of the balance of skills, experience and gender on the Board. Community Inclusive design is critical to community development. As such, we: l engage regularly with the communities in which we operate in order to understand their changing needs; l encourage architects and designers to focus on enhancing the living environment for our communities, thus designing spaces that promote diversity and inclusion to create vibrant communities; and l work to ensure the health and safety of the community which is a fundamental consideration of every decision we make. Employees We are a growing team and our staff are our most important asset. We are committed to creating a workplace that allows them to thrive. Our commitments to staff are detailed in our employee handbook and include: l strong employee engagement through regular team meetings and informal discussions; l fair employee remuneration practices which mean our staff receive competitive pay for the same or similar jobs, qualifications and experience within the market; l implementation of robust health and safety procedures to manage our key risks in order to create a proactive safety culture; and l commitment to being an equal opportunities employer and ensure the recruitment, selection, training, development and promotion of individuals is on the basis of their qualifications, experience and performance. Tenants Engaging with our tenants is essential for delivering true ESG value. We recognise that the way that our tenants use our buildings has significant influence on the ESG performance of our assets. l We promote ESG criteria as part of our tenant handbook (being developed), which is a key document for engaging with tenants’ ESG performance. l We will undertake periodic reviews of tenant satisfaction, helping to drive and influence design, refurbishment and maintenance of our buildings in a way that supports the needs of our tenants. l We look to provide spaces which promote safety, health and wellbeing of our tenants and their customers. 22 The Conygar Investment Company PLC ESG REPORT (continued) Business partners We have an obligation to fulfil the financial goals of our business partners in our activities and our partners are increasingly requesting information relating to ESG. We undertake the following: l proactive engagement on ESG risks and opportunities with our partners; l data collection, aggregation and reporting to those partners to help provide context on our ESG performance; and l to work with our partners to fulfil their goals and targets for ESG performance. Consultants, contractors and suppliers Engaging and partnering with our consultants, contractors and suppliers is crucial in delivering performance against this ESG policy and our ESG commitments. Accordingly, we: l adhere to specific social and labour standards set out in our procurement policy; l partner with key contractors and consultants to deliver the commitments set out in this policy; l require our key suppliers to have their own ESG commitments or, where they are a small business, to adhere to the key principles of our ESG policy; l partner with key suppliers to promote health, safety and wellbeing of our building users; and l work with key contractors, consultants and suppliers to collect data on our ESG performance to help us manage and improve ESG metrics and targets over time. Governance Conygar believes that robust and effective governance is the foundation for operating in line with our fiduciary duty and the applicable regulations. It is also fundamental for meeting the commitments we make to ourselves, the environment and to all our stakeholders. We always perform to the highest standards of ethical conduct with all of our staff complying with the codes of their professional bodies and those detailed in their individual employment contracts and our employee handbook. In line with this, we: l carry out our business fairly, honestly and openly by combating bribery, corruption and fraud; l recognise and proactively manage the risks we face in relation to data protection, privacy and cybersecurity by implementing robust systems and regular staff training; l respect our shareholders’ rights by operating transparently and ensuring we communicate openly and in a timely manner; and l ensure fair executive compensation which means our executives receive pay arrangements in line with market standards. This report was approved by the Board on 21 November 2022 and signed on its behalf by: D Baldwin Director 23 The Conygar Investment Company PLC DIRECTORS’ REMUNERATION REPORT Remuneration committee The Company’s remuneration committee is chaired by N J Hamway and its other member is B S Sandhu. The committee makes recommendations to the Board, within agreed terms of reference, on an overall remuneration package for Executive Directors and any other Senior Executives. Remuneration policy and review The Company’s policy on Directors’ remuneration remains that the overall remuneration package should be sufficiently competitive to attract, retain and motivate high quality executives capable of achieving the Group’s objectives and thereby enhancing shareholder value. The package consists of a basic salary with the potential for significant performance-related bonuses aligned to growth in shareholder value, as represented by net assets per share. All head office employees are employed by the Company. All operational and management individuals employed in connection with the restaurant and events venue at 1 The Island Quarter are employed by a wholly-owned group company, The Island Quarter Careers Limited. The details of individual components of the executive remuneration package and service contracts are summarised below. Basic salary and benefits: The salary and benefits are reviewed annually at the complete discretion of the remuneration committee. At present, the Directors receive no benefits. Profit sharing plan: The profit sharing plan (“The plan”) is an annual plan in which Executive Directors and Senior Executives will be entitled to an allocation of a profit sharing pool. The plan requires that the fully diluted net asset value per share must be at least 250p, and the mid-market share price must average at least 230p in the three months prior to any payment. When the asset value hurdle is passed the remuneration committee can accrue a profit sharing pool, however this will not be allocated or paid out until the share price criterion is met, and the committee is satisfied that the net asset value is based on realised profits. The plan is based upon the increase in the audited fully diluted net asset value per share of the Company. The profit sharing pool is 20% of any increase in the net asset value per share at 30 September over the previous highest audited diluted net asset value per share (“high watermark”) which was 196.3p. This ensures that Executive Directors cannot accrue any profit share twice in respect of the same net asset value growth. The previous high watermark was at 30 September 2014. A schedule showing the calculation will be published in the financial statements should any profit share accrue. The remuneration committee has absolute discretion over participation, pool allocation and determination of performance conditions, save in a limited number of circumstances covering change in control and certain good leaver provisions. Pensions: The Company does not make contributions to Directors’ or other employee’s pension plans other than as required through the Company’s workplace pension scheme. Service contracts: The Company’s policy is for all Executive Directors to have contracts of employment with provision for termination on no more than 12 months’ notice. 24 The Conygar Investment Company PLC DIRECTORS’ REMUNERATION REPORT (continued) Non-Executive Directors Neither of the Non-Executive Directors have service contracts. Letters of appointment provide for a period of three years which may be extended by mutual agreement for a further three years. B S Sandhu was appointed on 3 March 2020 and N J Hamway’s letter of appointment was extended on 21 October 2021. The remuneration of the Non-Executive Directors takes the form solely of fees, which are set by the Board, having taken advice on appropriate levels. The Non-Executive Directors are not involved in any discussions or decision about their own remuneration. Service contracts The service contracts and letters of appointment of the Directors include the following terms: Unexpired term Notice period Executive Directors Date of contract (months) (months) R T E Ware 11 May 2021 N/A 12 F N G Jones 11 May 2021 N/A 12 C J D Ware 26 January 2018 N/A 12 D Baldwin 1 September 2021 N/A 12 Non-Executive Directors N J Hamway 21 October 2021 24 6 B S Sandhu 3 March 2020 5 6 B S Sandhu and C J D Ware will retire by rotation at the AGM and, being eligible, offer themselves for re-election. Directors’ emoluments 2022 2021 Basic Basic Executive Directors salary Fees Total salary Fees Total £’000 £’000 £’000 £’000 £’000 £’000 R T E Ware 400 – 400 400 – 400 F N G Jones 165 – 165 162 – 162 C J D Ware 165 – 165 162 – 162 D Baldwin * 165 – 165 *65 – *65 Non-Executive Directors N J Hamway – 90 90 – 90 90 B S Sandhu – 50 50 – 50 50 –––––– –––––– –––––– –––––– –––––– –––––– 895 140 1,035 789 140 929 –––––– –––––– –––––– –––––– –––––– –––––– –––––– –––––– –––––– –––––– –––––– –––––– * Basic salary paid to D Baldwin, in connection with the year ended 30 September 2021, from his date of appointment as Finance Director on 10 May 2021. 25 The Conygar Investment Company PLC DIRECTORS’ REMUNERATION REPORT (continued) No non-cash benefits were paid to Directors. This report was approved by the Board on 21 November 2022 and signed on its behalf by: R T E Ware Director 26 The Conygar Investment Company PLC DIRECTORS’ REPORT Directors’ report The Directors present their report, of which the corporate governance report forms a part, and the accounts of the Group and the Company for the year ended 30 September 2022. Principal activities and review of the business The principal activity of the Group and the Company during the year was property trading, property investment, acquiring property assets with development and investment potential, and investing in companies with significant property assets. The Company’s principal subsidiaries are listed in note 14 to the accounts. Details of the share placing during the year are included in the strategic report. A review of the Company’s activities and likely future developments during this year is dealt with in the chairman’s and chief executive’s statement and the strategic report. Significant events since the balance sheet date There are no significant events since the balance sheet date that require disclosure in the financial statements. Results and dividends The Group’s trading results for the year and the Group’s and Company’s financial position at the end of the year are reported in the attached financial statements. The Directors do not recommend a dividend in respect of the year ended 30 September 2022 (2021: nil). Directors’ interest in shares The Directors’ interests in the shares of the Company, together with their beneficial and family interests, were as follows: Ordinary shares 30 September 2022 30 September 2021 R T E Ware 4,750,000 4,602,500 B S Sandhu 4,500,000 4,062,500 N J Hamway 1,189,700 1,089,700 C J D Ware 1,113,335 1,079,335 F N G Jones 179,200 164,200 D Baldwin 15,000 – –––––––––––––––––––––––––––––––––––––––––––––––––––– –––––––––––––––––––––––––––––––––––––––––––––––––––– There have been no changes in the Directors’ shareholdings since the year end. Directors’ indemnities The Company has made qualifying third party indemnity provisions for the benefit of its Directors which remain in force at the date of this report. 27 The Conygar Investment Company PLC DIRECTORS’ REPORT (continued) Major interests in shares At 21 November 2022, the Directors have been notified that the following shareholders have an interest of 3% or more in the Company’s issued share capital: Name No of shares % Premier Miton Group PLC 9,548,935 16.01 R T E Ware 4,750,000 7.96 B S Sandhu 4,500,000 7.55 Political contributions The Group made no political donations during the year (2021: £nil). Financial instruments Details of the Group’s financial instruments are given in note 24. Going concern The Group’s liquidity and cash flow forecasts, looking ahead two years, are considered at each Board meeting along with a review of tenant covenants and rental collection performance. The Group has committed, and expects to further commit, substantial amounts of cash to progress its pipeline of development projects, in particular at The Island Quarter. However, it will always ensure that such commitments are limited to the extent of its available resources. Furthermore, in order to continue with the long term progression of these projects, the Group will need to raise substantial amounts either as debt, through asset sales or from joint ventures and we are in advanced discussions on a number of fronts in that regard. The Directors have a reasonable expectation that the Company has, at present, and will obtain, as required, adequate resources to continue in operational existence for the foreseeable future and so for this reason, they continue to adopt the going concern basis in preparing the financial statements. Statement of Directors’ responsibilities The Directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations. The Directors are required to prepare financial statements for the Group in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and have elected to prepare financial statements for the Company in accordance with IFRS. Company law requires the Directors to prepare such financial statements in accordance with IFRS, the Companies Act 2006 and Article 4 of the IAS Regulation. 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 the affairs of the Group and Company and of the profit or loss of the Group for that period. International Accounting Standard 1 requires that the financial statements present fairly for each financial year the Company’s financial position, financial performance and cash flows. This requires the faithful representation of the effect of transactions, other events and conditions in accordance with the definitions and recognition criteria for assets, liabilities, income and expenses set out in the International Accounting Standards Board’s ‘Framework for the preparation and presentation of financial statements’. In virtually all circumstances, a fair presentation will be achieved by compliance with all the applicable IFRSs. Directors are also required to: l select suitable accounting policies and then apply them consistently; l make judgements and accounting estimates that are reasonable and prudent; l state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and 28 The Conygar Investment Company PLC DIRECTORS’ REPORT (continued) l prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company and Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. The Directors are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Directors have chosen, in accordance with S414c (11) of the Companies Act 2006, to include principal risks and uncertainties within the strategic report. Electronic publication The Directors are also responsible for the maintenance and integrity of the investor information contained on the website. Legislation in the UK concerning the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. Disclosure of information to auditor All of the Directors have taken all the steps that they ought to have taken to make themselves aware of any information needed by the auditor for the purposes of their audit and to establish that the auditor is aware of that information. The Directors are not aware of any relevant audit information of which the auditor is unaware. Auditor Saffery Champness LLP have expressed their willingness to continue in office and a resolution to appoint them as auditor for the ensuing year will be proposed at the forthcoming AGM. Annual General Meeting The AGM of the Company will be held on Monday, 19 December 2022 at 10.00am at the offices of The Conygar Investment Company PLC, First Floor, Suite 3, 1 Duchess Street London, W1W 6AN. The formal notice of the meeting and the resolutions to be proposed at that meeting are attached on page 64. In addition to ordinary business, there are resolutions to give a Director’s authority to disapply pre-exemption rights and allot equity securities together with a resolution to give share buy back authorities. By order of the Board D Baldwin Company Secretary 21 November 2022 29 The Conygar Investment Company PLC INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE CONYGAR INVESTMENT COMPANY PLC Opinion We have audited the financial statements of The Conygar Investment Company PLC (the ‘Company’) and its subsidiaries (the ‘Group’) for the year ended 30 September 2022 which comprise the consolidated statement of comprehensive income, the consolidated and company statement of changes in equity, the consolidated and company balance sheets, the consolidated and company cash flow statements and notes to the accounts, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted international accounting standards. In our opinion the financial statements: l give a true and fair view of the state of affairs of the Group and of the Company as at 30 September 2022 and of the Group’s loss for the year then ended; l have been properly prepared in accordance with UK-adopted international accounting standards; and l 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 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. Our approach to the audit We tailored the scope of our audit to ensure that we obtained sufficient evidence to support our opinion on the financial statements as a whole, taking into account the structure of the Group, the nature of the Group’s accounting processes and controls, and the industry in which it operates. As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements. In particular, we looked at where the Directors made subjective judgements, for example in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. The risks of material misstatement that had the greatest effect on our audit, including the allocation of our resources and effort, are discussed under “Key audit matters” within this report. The Group consists of the Company and its twenty subsidiaries, seventeen of which are registered in the UK, with the remaining three incorporated in Jersey. All audit work has been carried out by us. No work was undertaken by component auditors. Our Group audit scope included an audit of the Group and Company financial statements. Based on our risk assessment, all non-dormant entities within the Group were subject to full scope audits and these audits were performed by the Group audit team. The extent of our audit work on the components was based on our assessment of the risk of material misstatement and of the materiality of each component. The components within the scope of our audit work therefore covered 100% of Group revenue, Group profit before tax and Group net assets. At Group level we also tested the consolidation process to confirm our conclusion that there were no significant risks of material misstatement of the consolidated financial information. 30 The Conygar Investment Company PLC INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE CONYGAR INVESTMENT COMPANY PLC (continued) Key audit matters Key audit matters are those matters that, in our professional judgment, 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 we identified (whether or not due to fraud), 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. to the external valuation reports; Our audit procedures included the following: l Agreeing the investment property valuations Key audit matter How our scope addressed this matter Valuation of investment property The Group’s investment properties under construction at Nottingham represent significant assets to the Group and in accordance with IAS 40 are measured at fair value on the consolidated statement of financial position. Investment properties relating to the Nottingham project are accounted for as investment properties under construction at a fair value of £93m. The Directors obtained a third-party valuation to assist in their assessment of the fair value of the investment property. Due to the significance of the investment property under construction to the financial statements and the judgements used in determining the fair value, the valuation of investment properties is considered to be a key audit matter. recorded in l Challenging the assumptions used in the preparation of the valuation report, including benchmarking the key assumptions and to external market data and inputs in comparable property particular rental yields; transactions, l Assessing the competence, independence and the l Confirming that fair value movements have been statement of comprehensive income, in the period in which they arise, in accordance with IAS 40. Based on our procedures performed, we have not identified any material misstatement arising from the valuation of investment properties. integrity of the external valuer; and Impairment of development and trading properties Included in the Group’s financial statements are development and trading properties held at £17.1m. During the year an impairment loss of £0.3m was charged statement of the consolidated to comprehensive income. At each reporting date the Directors assess whether there is any indication that the development and trading properties held are impaired. These impairment assessments incorporate a range of assumptions, estimates and judgements, such as land value and rental yield. Due to the significance of the development and trading properties to the financial statements and the judgements involved in the impairment review of development and trading properties, this is considered a key audit matter. Our audit procedures included the following: l Reviewing management’s consideration of impairment derived from appraisals and other market comparables; l Verifying and challenging any assumptions, estimates, contentions judgements or incorporated into management’s impairment calculations, such as the use of market yield, to supporting external evidence; l Testing the arithmetical accuracy of impairment calculations; and l Reviewing disclosures made regarding the impairment recognised in the year and agreeing to the underlying model. Based on our audit procedures performed, we have not identified any material misstatement arising from the impairment of development and trading properties. 31 The Conygar Investment Company PLC INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE CONYGAR INVESTMENT COMPANY PLC (continued) in Key audit matter How our scope addressed this matter Disposal of investment properties and development and trading properties Included the consolidated statement of comprehensive income are proceeds of sale of development and trading properties of £7.39m, costs on sale of such properties of £3.75m and profit on sale of investment properties of £0.38m. Due to the significance of these amounts to the Group’s result for the year, the disposals of investment properties and development and trading properties are a key audit matter. Our audit procedures included the following: l Reviewing independent third-party evidence of the transactions in the year including contracts for sale, agreeing sale proceeds and land registry filings; and l Recalculating the profit on disposal of properties and agreeing the amounts to the consolidated statement of comprehensive income. Based on our audit procedures performed, we have not identified any material misstatement arising from the disposal of investment properties and development and trading properties. Our application of materiality We apply the concept of materiality in planning and performing our audit, in evaluating the effect of any identified misstatements and in forming our opinion. Our overall objective as auditor is to obtain reasonable assurance that the financial statements as a whole are free from material misstatement, whether due to fraud or error. We consider a misstatement to be material where it could reasonably be expected to influence the economic decisions of the users 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 this level will not necessarily be evaluated as immaterial as we also take into account the qualitative nature of identified misstatements, and the particular circumstances of their occurrence, when evaluating their effect on the financial statements. Based on our professional judgement and taking into account the possible metrics used by investors and other readers of the accounts, we have determined an overall Group materiality of £2,645,000 based on 2% of gross assets for the year ended 30 September 2022. Materiality of £1,947,000 was used for the Company based on 2% of gross assets, capped to an appropriate level for Group purposes. Group performance materiality was set at £2,116,000 representing 80% of overall materiality. The Company performance materiality was also set at £1,558,000. We agreed with the Audit Committee to report all individual audit differences in excess of £132,000 in relation to the Group and £97,000 for the Company, being the level below which misstatements are considered to be clearly trivial. We also agreed to report any other identified misstatements that warranted reporting on qualitative grounds. Conclusions relating to going concern In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the Directors’ assessment of the Group and the Company’s ability to continue to adopt the going concern basis of accounting included: l obtaining, critically appraising and assessing for arithmetical accuracy the Directors’ formal going concern assessment; l reviewing projected cashflows and other available evidence to assess the ability of the Company to continue in operation for at least twelve months from the date of approval of the financial statements; 32 The Conygar Investment Company PLC INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE CONYGAR INVESTMENT COMPANY PLC (continued) l reviewing the results of the Directors’ modelling of scenarios for cash flows based on expected property sales and performing a sensitivity analysis on key assumptions underlying their going concern assessment, including the timing of commencement of, and the level of expenditure on, property development, and assessing whether the parameters selected are appropriate based on the likelihood of occurrence and financial impact; and l consideration of material events after the reporting date to assess their impact on the going concern assumption, including comparison of post year end cash balances to forecast positions and discussion with the Directors regarding events within the post balance sheet period. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group or the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report. Other information The Directors are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information we are required to report that fact. We have nothing to report in this regard. Opinions on other matters prescribed by the Companies Act 2006 In our opinion, based on the work undertaken in the course of the audit: l 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 l 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 Company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: l adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received from branches not visited by us; or l the Company financial statements are not in agreement with the accounting records and returns; or l certain disclosures of Directors’ remuneration specified by law are not made; or l we have not received all the information and explanations we require for our audit. 33 The Conygar Investment Company PLC INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE CONYGAR INVESTMENT COMPANY PLC (continued) Responsibilities of Directors As explained more fully in the Directors’ Responsibilities Statement set out on pages 28 and 29, 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 Director’s 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 and Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or the Company or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the Group and Company financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below. Identifying and assessing risks related to irregularities: We assessed the susceptibility of the Group and Company’s financial statements to material misstatement and how fraud might occur, including through discussions with the Directors, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these controls operated as intended. We evaluated possible incentives and opportunities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the Group and Company by discussions with Directors, and by updating our understanding of the sector in which the Group and Company operate. Laws and regulations of direct significance in the context of the Group and Company include The Companies Act 2006, the AIM Rules for Companies and UK Tax legislation. In addition, the Group is subject to other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to its ability to operate or to avoid a material penalty. These include anti-bribery legislation, employment law and health and safety regulations relating to the operation of a restaurant and construction activities. Audit response to risks identified: We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statement items including a review of Group and Company financial statement disclosures. We reviewed the Company’s records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the Company’s policies and procedures for compliance with laws and regulations with members of management responsible for compliance. 34 The Conygar Investment Company PLC INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE CONYGAR INVESTMENT COMPANY PLC (continued) During the planning meeting with the audit team, the engagement partner drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to a possible indication of management bias. At the completion stage of the audit, the engagement partner’s review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud. As Group auditors, our assessment of matters relating to non-compliance with laws or regulations and fraud differed at Group and component level according to their particular circumstances. There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report. Use of our report This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed. Michael Di Leto (Senior Statutory Auditor) for and on behalf of Saffery Champness LLP Chartered Accountants Statutory Auditors 71 Queen Victoria Street London EC4V 4BE 21 November 2022 35 The Conygar Investment Company PLC CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME for the year ended 30 September 2022 Year ended Year ended 30 Sep 22 30 Sep 21 Note £’000 £’000 Rental income 1 (404) 1,592 Other income 73 – Proceeds on sale of development and trading properties 7,390 1,050 –––––––––– –––––––––– Revenue 7,059 2,642 –––––––––– –––––––––– Direct costs of rental income 395 288 Direct costs of other income 572 – Costs on sale of development and trading properties 3,749 620 Development costs written off 15 289 675 –––––––––– –––––––––– Direct costs 5,005 1,583 –––––––––– –––––––––– Gross profit 2,054 1,059 Surplus on revaluation of investment property 12 – 459 Surplus on revaluation of investment properties under construction 13 320 28,718 Profit on sale of investment property 380 – Administrative expenses (2,851) (2,058) –––––––––– –––––––––– Operating (loss)/profit 3 (97) 28,178 Finance costs 6 – (2) Finance income 6 73 34 –––––––––– –––––––––– (Loss)/profit before taxation (24) 28,210 Taxation 8 (29) (1,685) –––––––––– –––––––––– (Loss)/profit and total comprehensive (charge)/income for the year (53) 26,525 –––––––––– –––––––––– –––––––––– –––––––––– Basic and diluted (loss)/profit per share 10 (0.09p) 49.99p All amounts are attributable to equity shareholders of the Company. All of the activities of the Group are classed as continuing. The notes on pages 43 to 62 form part of these accounts 36 The Conygar Investment Company PLC CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended 30 September 2022 Attributable to the equity holders of the Company Share Capital Share premium redemption Treasury Retained Total capital account reserve shares earnings equity Group £’000 £’000 £’000 £’000 £’000 £’000 Changes in equity for the year ended 30 September 2021 At 1 October 2020 2,680 – 3,873 – 82,280 88,833 Profit for the year – – – – 26,525 26,525 ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– Total comprehensive income for the year – – – – 26,525 26,525 Purchase of own shares – – – (1,217) – (1,217) Cancellation of treasury shares (55) – 55 1,217 (1,217) – ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– At 30 September 2021 2,625 – 3,928 – 107,588 114,141 ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– Changes in equity for the year ended 30 September 2022 At 1 October 2021 2,625 – 3,928 – 107,588 114,141 Loss for the year – – – – (53) (53) ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– Total comprehensive charge for the year – – – – (53) (53) Gross proceeds from placing of own shares 357 10,352 – – – 10,709 Fees paid on placing of own shares – (193) – – – (193) Cancellation of share premium account – (10,159) – – 10,159 – ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– At 30 September 2022 2,982 – 3,928 – 117,694 124,604 ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– The notes on pages 43 to 62 form part of these accounts 37 The Conygar Investment Company PLC COMPANY STATEMENT OF CHANGES IN EQUITY for the year ended 30 September 2022 Share Capital Share premium redemption Treasury Retained Total capital account reserve shares earnings equity Company £’000 £’000 £’000 £’000 £’000 £’000 Changes in equity for the year ended 30 September 2021 At 1 October 2020 2,680 – 3,873 – 67,257 73,810 Loss for the year – – – (1,191) (1,191) ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– Total comprehensive charge for the year – – – – (1,191) (1,191) Purchase of own shares – – – (1,217) – (1,217) Cancellation of treasury shares (55) – 55 1,217 (1,217) – ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– At 30 September 2021 2,625 - 3,928 – 64,849 71,402 ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– Changes in equity for the year ended 30 September 2022 At 1 October 2021 2,625 – 3,928 – 64,849 71,402 Profit for the year – – – – 1,561 1,561 ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– Total comprehensive income for the year – – – – 1,561 1,561 Gross proceeds from placing of own shares 357 10,352 – – – 10,709 Fees paid on placing of own shares – (193) – – – (193) Cancellation of share premium account – (10,159) – – 10,159 – ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– At 30 September 2022 2,982 – 3,928 – 76,569 83,479 ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– ––––––––– The notes on pages 43 to 62 form part of these accounts 38 The Conygar Investment Company PLC CONSOLIDATED BALANCE SHEET at 30 September 2022 Company number: 04907617 30 Sep 2022 30 Sep 2021 Note £’000 £’000 Non–current assets Plant, machinery and office equipment 11 991 – Investment properties 12 – 17,750 Investment properties under construction 13 93,000 70,500 Right of use asset 7 – 53 Deferred tax asset 8 2,986 2,935 –––––––––– –––––––––– 96,977 91,238 –––––––––– –––––––––– Current assets Development and trading properties 15 17,137 20,192 Inventories 16 32 – Trade and other receivables 17 770 2,661 Tax asset 28 28 Cash and cash equivalents 17,361 13,657 –––––––––– –––––––––– 35,328 36,538 –––––––––– –––––––––– Total assets 132,305 127,776 Current liabilities Trade and other payables 18 1,605 3,367 Provision for liabilities and charges 19 – 5,614 Lease liability for right of use asset 7 – 34 –––––––––– –––––––––– 1,605 9,015 Non-current liabilities Deferred tax liability 8 4,700 4,620 Provision for liabilities and charge 19 1,396 – –––––––––– –––––––––– 6,096 4,620 –––––––––– –––––––––– Total liabilities 7,701 13,635 –––––––––– –––––––––– Net assets 124,604 114,141 –––––––––– –––––––––– –––––––––– –––––––––– Equity Called up share capital 20 2,982 2,625 Capital redemption reserve 3,928 3,928 Retained earnings 117,694 107,588 –––––––––– –––––––––– Total equity 124,604 114,141 –––––––––– –––––––––– –––––––––– –––––––––– The accounts on pages 36 to 62 were approved by the Board and authorised for issue on 21 November 2022 and are signed on its behalf by: R T E WARE D BALDWIN } The notes on pages 43 to 62 form part of these accounts 39 The Conygar Investment Company PLC COMPANY BALANCE SHEET at 30 September 2022 Company number: 04907617 30 Sep 2022 30 Sep 2021 Note £’000 £’000 Non-current assets Investment in subsidiary undertakings 14 16 16 Right of use asset 7 – 53 –––––––––– –––––––––– 16 69 –––––––––– –––––––––– Current assets Development and trading properties 15 2,880 6,570 Trade and other receivables 17 77,684 60,628 Cash and cash equivalents 16,733 12,956 –––––––––– –––––––––– 97,297 80,154 –––––––––– –––––––––– Total assets 97,313 80,223 Current liabilities Trade and other payables 18 13,834 8,787 Lease liability for right of use asset 7 – 34 –––––––––– –––––––––– Total liabilities 13,834 8,821 –––––––––– –––––––––– Net assets 83,479 71,402 –––––––––– –––––––––– –––––––––– –––––––––– Equity Called up share capital 20 2,982 2,625 Capital redemption reserve 3,928 3,928 Retained earnings 76,569 64,849 –––––––––– –––––––––– Total equity 83,479 71,402 –––––––––– –––––––––– –––––––––– –––––––––– The Company has taken advantage of the exemption within section 408 of the Companies Act 2006 not to present its own profit and loss account. The profit for the year dealt with in the financial statements of the Company was £1,561,000 (2021: loss of £1,191,000). As at 30 September 2022, the entire balance of £76,569,000 in retained earnings represents distributable reserves. The accounts on pages 36 to 62 were approved by the Board and authorised for issue on 21 November 2022 and are signed on its behalf by: R T E WARE D BALDWIN } The notes on pages 43 to 62 form part of these accounts 40 The Conygar Investment Company PLC CONSOLIDATED CASH FLOW STATEMENT for the year ended 30 September 2022 Year ended Year ended 30 Sep 22 30 Sep 21 £’000 £’000 Cash flows from operating activities Operating (loss)/profit (97) 28,178 Development costs written off 289 675 Surplus on revaluation of investment properties (320) (29,177) Profit on sale of investment property (380) – Profit on sale of development and trading properties (3,641) (430) Depreciation of right of use assets 53 93 –––––––––– –––––––––– Cash flows from operations before changes in working capital (4,096) (661) Increase in inventories (32) – Decrease/(increase) in trade and other receivables 1,892 (1,006) Additions to development and trading properties (1,115) (1,438) Net proceeds from sale of development and trading properties 7,337 1,025 (Decrease)/increase in trade and other payables (94) 287 –––––––––– –––––––––– Cash flows generated from/(used in) operations 3,892 (1,793) Tax received – 3 –––––––––– –––––––––– Net cash flows generated from/(used in) operations 3,892 (1,790) –––––––––– –––––––––– Cash flows from investing activities Additions to investment properties (28,085) (15,496) Net proceeds from sale of an investment property 18,278 – Additions to plant, machinery and office equipment (970) – Finance income 73 34 –––––––––– –––––––––– Cash flows used in investing activities (10,704) (15,462) –––––––––– –––––––––– Cash flows from financing activities Net proceeds from placing of own shares 10,516 – Purchase of own shares – (1,217) –––––––––– –––––––––– Cash flows generated from/(used in) financing activities 10,516 (1,217) –––––––––– –––––––––– Net increase/(decrease) in cash and cash equivalents 3,704 (18,469) Cash and cash equivalents at 1 October 13,657 32,126 –––––––––– –––––––––– Cash and cash equivalents at 30 September 17,361 13,657 –––––––––– –––––––––– –––––––––– –––––––––– As the Group is currently funded wholly through asset sales and equity instruments, no reconciliation of changes in liabilities arising from financing activities is presented. The notes on pages 43 to 62 form part of these accounts 41 The Conygar Investment Company PLC COMPANY CASH FLOW STATEMENT for the year ended 30 September 2022 Year ended Year ended 30 Sep 22 30 Sep 21 £’000 £’000 Cash flows from operating activities Operating profit/(loss) 1,497 (1,208) Profit on sale of development and trading properties (3,641) (430) Depreciation of right of use assets 53 93 Provision against loan to group undertaking (10) (14) –––––––––– –––––––––– Cash flows from operations before changes in working capital (2,101) (1,599) Decrease/(increase) in trade and other receivables 47 (17) Net proceeds from the sale of development and trading properties 7,331 1,025 Increase/(decrease) in trade and other payables 13 (101) –––––––––– –––––––––– Cash flows used in operating activities 5,290 (652) –––––––––– –––––––––– Cash flows from investing activities Movement in balances with group entities (12,102) (16,394) Finance income 73 34 –––––––––– –––––––––– Cash flows used in investing activities (12,029) (16,360) –––––––––– –––––––––– Cash flows from financing activities Net proceeds from placing of own shares 10,516 – Purchase of own shares – (1,217) –––––––––– –––––––––– Cash flows used in financing activities 10,516 (1,217) –––––––––– –––––––––– Net increase/(decrease) in cash and cash equivalents 3,777 (18,229) Cash and cash equivalents at 1 October 12,956 31,185 –––––––––– –––––––––– Cash and cash equivalents at 30 September 16,733 12,956 –––––––––– –––––––––– –––––––––– –––––––––– As the Company is currently funded wholly through asset sales and equity instruments, no reconciliation of changes in liabilities arising from financing activities is presented. The notes on pages 43 to 62 form part of these accounts 42 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS for the year ended 30 September 2022 1. General information and accounting policies 1a General information The Conygar Investment Company PLC (“the Company”) is incorporated in the United Kingdom and domiciled in England and Wales, is registered at Companies House under registration number 04907617, listed on the AIM market of the London Stock Exchange and limited by shares. The Company’s subsidiaries are shown in note 14. The Company and its subsidiaries are collectively referred to below as “the Group”. The nature and scope of the Group’s operations and principal activities are described in the strategic report on pages 7 to 14. Further information about the Group can be found on its website, www.conygar.com. 1b Accounting policies The principal accounting policies of the Group are set out below. These policies have been consistently applied in the preparation of these financial statements. Basis of preparation The financial statements are presented in Sterling as this is the Group’s functional currency. Amounts are rounded to the nearest thousand pounds, unless otherwise stated. The financial statements have been prepared in accordance with applicable law and UK-adopted international accounting standards. The Directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future and therefore continue to adopt the going concern basis of accounting in preparing the financial statements. The financial statements have been prepared on the historical cost basis except where stated otherwise in the accounting policies below. Adoption of new and revised standards The Group has also adopted all new amendments to standards and interpretations, which came into effect for the current financial year, but these have not had a material impact on the disclosures or amounts reported in the financial statements. Standards and interpretations in issue not yet adopted The following IFRSs have been issued but are not effective as at the balance sheet date and so have not been applied in the preparation of these financial statements: Amendments to IFRS 9, IFRS 17, IAS 1, IAS 8 and IAS 12. The future adoption of these standards and interpretations is not expected to have a material effect on the financial statements of the Group. 43 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 1. General information and accounting policies (continued) Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company and all its entities, which are controlled by the Company. Control is achieved when the Company: l has the power over the investee; l is exposed, or has rights to variable returns from its involvement with the investee; and l has the ability to use its power to affect its returns. The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the elements of control listed above. The results of subsidiaries are included in the consolidated financial statements from the effective date of acquisition to the effective date of disposal. Adjustments are made when necessary to the financial statements of subsidiaries to bring their accounting policies in line with those of the Group. All intra Group transactions, balances, income and expenses are eliminated in full on consolidation. Revenue Property revenue comprises rental and other income exclusive of VAT, which is recognised in the statement of comprehensive income on an accruals basis and a straight line basis, together with sales of trading, development and investment properties which constitute contracts with customers recognised at a point in time. Rental income receivable in the period from lease commencement to the earlier of lease expiry and any tenant’s option to break is spread evenly over that period. Turnover is attributable to the principal activity of the Company and arises wholly within the United Kingdom. As set out in the strategic report, the rental income charge for the current year has arisen from the reversal of a £1.4 million accrued rent debtor following the sales of Cross Hands and Selly Oak. Disposals of properties are recognised when the buyer obtains control of the property by way of obtaining the legal title or possession of the property or when the significant risks and returns have been transferred to the buyer. For conditional exchanges, sales are recognised when the conditions are either waived or satisfied. Finance income comprises bank interest recognised on an effective interest rate basis. Expenses All expenses are accounted for on an accruals basis. They are charged through the statement of comprehensive income with the exception of share issue expenses, which are charged to the share premium account. Taxation The taxation charge represents the sum of tax currently payable and deferred tax. The charge for current taxation is based on the results for the year as adjusted for non-assessable or disallowed items. It is calculated using rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax is the tax expected to be payable or recoverable 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 recognised to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax is calculated at the tax rates that have been enacted or substantively enacted by the balance sheet date and are expected to apply in the period when the liability is settled or the asset is realised. 44 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 1. General information and accounting policies (continued) Plant, machinery and office equipment Plant, machinery and office equipment are stated at cost less accumulated amortisation. Depreciation Depreciation is recognised so as to write off the cost of assets, over their estimated useful economic lives, using the straight line method, on the following basis: Plant and machinery - 25% per annum Office equipment - 25% per annum Impairment of plant, machinery and office equipment A review of indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. Investment in subsidiaries Investments in subsidiaries are held in the Company balance sheet at cost and reviewed annually for impairment. Investment properties Investment properties comprise properties owned by the Group which are held for capital appreciation, rental income or both. They are initially recorded at cost and subsequently valued at each balance sheet date at fair value as determined by professionally qualified external valuers. Acquisitions of investment properties are recognised on unconditional exchange of contracts where it is reasonable to assume at the balance sheet date that completion of the acquisition will occur. After initial recognition, investment properties are measured at fair value, with unrealised gains and losses recognised in the statement of comprehensive income. Valuations are calculated by applying capitalisation rates to future rental cash flows with reference to data from comparable market transactions, together with an assessment of the security of the income. Investment properties under construction Investment properties under construction are initially reported in the balance sheet at cost less impairment. This methodology is adopted because the value of these properties is dependent upon a detailed knowledge of the planning status, the competitive position of the assets and a range of complex development appraisals. The fair value of these properties rests in the planned developments, and are often difficult to estimate pending confirmation of designs, planning permissions and uncertain market conditions, and hence, in accordance with IAS 40, are measured at cost until either the fair value becomes readily determinable or construction is complete. However, once the development of the property is sufficiently designed, appraised and advanced, and market comparables are readily available, investment properties under construction are then valued at each balance sheet date at fair value, as determined by professionally qualified external valuers, with unrealised gains and losses recognised in the statement of comprehensive income. Valuations are calculated by applying capitalisation rates to future rental cash flows with reference to data from comparable market transactions, together with an assessment of the security of the income. Impairment losses are calculated as the difference between an asset’s carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate. When the Group considers that there are no realistic prospects of recovery of the asset, the relevant amounts are written off. If the amount of impairment loss subsequently decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, then the previously recognised impairment loss is reversed through the statement of comprehensive income. 45 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 1. General information and accounting policies (continued) Development and trading properties Development and trading properties are reported in the balance sheet at the lower of cost and net realisable value. Cost comprises the original purchase price of the property together with directly attributable costs. Net realisable value represents the estimated selling price less all estimated costs of completion. During the year the Group wrote off £0.3 million of development costs its development site at Holyhead Waterfront (2021: £0.7 million). in connection with Cash and cash equivalents Cash and cash equivalents comprise cash in hand and deposits with maturities of three months or less held with banks and financial institutions. Trade and other receivables Trade and other receivables are measured on initial recognition at fair value, and are subsequently measured at amortised cost using the effective interest rate method, less any impairment. Impairment is calculated using an expected credit loss model. Inventories Raw materials and consumables are valued at the lower of cost and net realisable value. Cost is based on latest contracted purchase cost. Trade and other payables Trade and other payables are recognised initially at fair value, and are subsequently measured at amortised cost using the effective interest rate method. Financial liabilities and equity Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. Provisions Provisions are recognised when the Group has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and the amount can be readily estimated. Equity instruments Equity instruments issued by the Company are recorded at the proceeds received, net of directly attributable issue costs. Dividend distributions to the Company’s shareholders are recognised as a liability in the Group’s financial statements in the period in which the dividend is approved by the Company’s shareholders and subsequently paid. Treasury shares Shares which have been repurchased are classified as treasury shares and shown as a separate item within equity. They are recognised at the trade date for the amount of consideration paid, together with directly attributable costs. This is presented as a deduction from total equity. Capital redemption reserve Upon cancellation of treasury shares the nominal value of each cancelled share is transferred to the capital redemption reserve with any premium paid for those shares, over their nominal value, treated as a deduction from retained earnings. Leasing The Group has entered into commercial property leases as lessor of its investment and development and trading property portfolio. As the terms of these leases do not transfer substantially all the risks and rewards of ownership to the lessee they are classified as operating leases. Rentals receivable under operating leases are credited to income on a straight line basis over the term of the relevant lease. Benefits granted as an incentive to enter into an operating lease are also spread on a straight line basis over the lease term. The Group leases its office premises. Where the amounts in question are considered material, in accordance with IFRS 16, the Group recognises a right of use asset and corresponding lease liability for its office lease, which is depreciated and amortised respectively over the lease term. However, where leases are low value or of less than 12 months, the expense is recognised on a straight line basis over the lease term. 46 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 1. General information and accounting policies (continued) 1c Accounting estimates and judgements The preparation of financial statements in conformity with IFRS requires the Directors to make judgements, estimates and assumptions that may affect the reported amounts of assets and liabilities at each balance sheet date and the reported amounts of revenue and expenses during the year. These estimates are based on historical experience and various other assumptions that management believe are reasonable under the circumstances. The principal areas of estimation uncertainty that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year are: l Valuations of investment properties and investment properties under construction, where the opinion of external valuers has been obtained at each reporting date using recognised valuation techniques and the principles of IFRS 13 “Fair Value Measurement”. The significant methods and assumptions used by the valuers to estimate the fair value of investment properties are set out in notes 12 and 13. l The net realisable value of properties held for development, which requires an assessment of fair value for the underlying assets using property appraisal techniques and other valuation methods. Such estimates are inherently subjective and actual values can only be determined in a sales transaction. The principal areas of judgement are as follows: l The Directors have assessed the carrying values of the Group’s trading and development properties at the balance sheet date. Consideration has been given to such factors as market conditions, cash flow projections and comparable transaction evidence. Where a property’s carrying value is considered to be impaired an adjustment has been made to write down the asset to the Directors’ assessment of its net realisable value. During the year ended 30 September 2022, the Group’s investment in Holyhead Waterfront has been written down by £0.3 million. l Trade receivables and accrued rental income recognised in advance of receipt are subject to credit risk assessment. This accrued rental income arises due to the spreading of rent-free periods and contracted rental uplifts in accordance with IFRS 16 Leases. Impairment calculations have been carried out using the forward-looking, simplified approach to the expected credit loss model within IFRS 9. 2. Segmental information IFRS 8 “Operating Segments” requires the identification of the Group’s operating segments which are defined as being discrete components of the Group’s operations whose results are regularly reviewed by the Board. The Group divides its business into the following segments: l Investment properties held for capital appreciation, rental income or both; and, l Development properties, which includes sites and developments under construction held for sale in the ordinary course of business. l Food beverage and events operations 47 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 2. Segmental information (continued) Balance sheet As at 30 Sep 2022 As at 30 Sep 2021 Food, Investment Development beverage Group Investment Development Group properties properties and events Other total properties properties Other total £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 Investment properties 93,000 – – – 93,000 88,250 – – 88,250 Development and trading properties – 17,137 – – 17,137 – 20,192 – 20,192 Plant, machinery and office equipment – – 991 – 991 – – – – ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– 93,000 17,137 991 – 111,128 88,250 20,192 – 108,442 Other assets 3,180 33 545 17,418 21,176 5,080 335 13,919 19,334 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Total assets 96,180 17,170 1,536 17,418 132,304 93,330 20,527 13,919 127,776 Liabilities (6,973) (73) (477) (177) (7,700) (13,129) (329) (177) (13,635) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Net assets 89,207 17,097 1,059 17,241 124,604 80,201 20,198 13,742 114,141 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Income statement Year ended 30 Sep 2022 Year ended 30 Sep 2021 Food, Investment Development beverage Group Investment Development Group properties properties and events Other total properties properties Other total £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 Revenue (490) 7,476 73 – 7,059 1,233 1,409 – 2,642 Direct costs (128) (4,305) (572) – (5,005) (127) (1,456) – (1,583) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Gross (loss)/profit (618) 3,171 (499) – 2,054 1,106 (47) – 1,059 Revaluation of investment properties 320 – – – 320 29,177 – – 29,177 Profit on sale of investment property 380 – – – 380 – – – – Administrative expenses – – (675) (2,176) (2,851) – – (2,058) (2,058) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Operating (loss)/profit 82 3,171 (1,174) (2,176) (97) 30,283 (47) (2,058) 28,178 Finance costs – – – – – – – (2) (2) Finance income – – – 73 73 – – 34 34 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– (Loss)/profit before taxation 82 3,171 (1,174) (2,103) (24) 30,283 (47) (2,026) 28,210 Taxation (29) – – – (29) (1,685) – – (1,685) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– (Loss)/profit after taxation 53 3,171 (1,174) (2,103) (53) 28,598 (47) (2,026) 26,525 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– 48 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 3. Operating (loss)/profit Operating (loss)/profit is stated after charging: Year ended Year ended 30 Sep 22 30 Sep 21 £’000 £’000 Audit of the Company’s consolidated and individual financial statements 47 47 Audit of subsidiaries, pursuant to legislation 56 24 Amortisation of right of use asset 53 93 4. Particulars of employees The aggregate payroll costs were: Year ended Year ended 30 Sep 22 30 Sep 21 £’000 £’000 Wages and salaries 1,674 1,247 Social security costs 203 161 Other pension costs 8 – –––––––––– –––––––––– 1,885 1,408 –––––––––– –––––––––– –––––––––– –––––––––– The weighted average monthly number of persons, including Executive Directors, employed by the Group during the year was twenty two (2021: seven). The increase in the year is a result of the additional employees that have been recruited to operate and manage the restaurant and events venue at 1 The Island Quarter. 5. Directors’ emoluments Year ended Year ended 30 Sep 22 30 Sep 21 £’000 £’000 Basic salary and total emoluments 1,035 929 –––––––––– –––––––––– –––––––––– –––––––––– Emoluments of the highest paid Director 400 400 –––––––––– –––––––––– –––––––––– –––––––––– The Board, being the key management personnel, comprises the only persons having authority and responsibility for planning, directing and controlling the activities of the Group. 6. Finance income and cost Year ended Year ended 30 Sep 22 30 Sep 21 £’000 £’000 Bank interest receivable 73 34 –––––––––– –––––––––– –––––––––– –––––––––– Interest cost under IFRS 16 – 2 –––––––––– –––––––––– –––––––––– –––––––––– 49 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 7. Leases Group and Company as lessor: The Group and Company receive income from investment properties and existing tenants located at several development sites. At 30 September 2022, the minimum lease payments receivable under non-cancellable operating leases were as follows: Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 Less than one year 134 1,385 – 232 Between one and five years 607 5,873 – 716 Over five years 1,320 6,249 – 160 –––––––––– –––––––––– –––––––––– –––––––––– 2,061 13,507 – 1,108 –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– The amounts above represent total rental income up to the next tenant only break date for each lease. Group and Company as lessee: The Group and Company were party to a three-year lease which terminated on 28 April 2022. On 11 March 2022, the Group and Company entered into a subsequent one-year lease, for the same premises, which terminates on 28 April 2023. The rental charge in connection with the new lease, for the period from 28 April 2022 to 30 September 2022, amounted to £40,617. IFRS 16 requires lessees to record all leases on the balance sheet as liabilities, along with an asset reflecting the right of use of the asset over the lease term, so long as they are not for a low value or less than 12 months whereby the lease could be recognised as an expense on a straight line basis over the lease term. The lease liability for three-year term was calculated as the present value of the remaining lease payments, discounted at an incremental borrowing rate of 2.7%. The right of use asset was measured at the amount equal to the lease liability adjusted for rent prepaid on the date of implementation. Depreciation of the right of use asset was on a straight line basis over the lease term. The modified retrospective approach was adopted for transition purposes such that comparatives were not restated and the difference between the right of use asset and lease liability at the start of the prior year was recognised within the Group’s opening retained earnings. 50 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 7. Leases (continued) The current one-year lease is considered to be of low value and as such will be recognised as an expense over the lease term on a straight line basis. Year ended Year ended 30 Sep 22 30 Sep 21 Right of use asset £’000 £’000 At the start of the year 53 146 Depreciation (53) (93) –––––––––– –––––––––– At the end of the year – 53 –––––––––– –––––––––– –––––––––– –––––––––– Lease liability £’000 £’000 At the start of the year 34 123 Lease payments (34) (91) Interest on lease liability – 2 –––––––––– –––––––––– At the end of the year – 34 –––––––––– –––––––––– –––––––––– –––––––––– 30 Sep 22 30 Sep 21 Lease liability maturity analysis £’000 £’000 Gross lease payments due within one year – 34 Less future financing charges – – –––––––––– –––––––––– At end of the year – 34 –––––––––– –––––––––– –––––––––– –––––––––– 8. Tax Year ended Year ended 30 Sep 22 30 Sep 21 £’000 £’000 Current tax charge – – Deferred tax charge 29 1,685 –––––––––– –––––––––– Total tax charge 29 1,685 –––––––––– –––––––––– –––––––––– –––––––––– 51 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 8. Tax (continued) The tax assessed on the (loss)/profit for the year differs from the standard rate of tax in the UK of 19% (2021: 19%). The differences are explained below: Year ended Year ended 30 Sep 22 30 Sep 21 £’000 £’000 (Loss)/profit before tax (24) 28,210 –––––––––– –––––––––– –––––––––– –––––––––– (Loss)/profit before tax multiplied by the standard rate of UK tax (5) 5,360 Effects of: Investment property revaluation not taxable (61) (5,543) Capital loss not taxable (72) – Utilisation of tax losses brought forward (96) – Movement in tax losses carried forward 224 186 Expenses not deductible for tax purposes 15 10 Capital allowances utilised (5) (13) Deferred tax charge 29 1,685 –––––––––– –––––––––– Total tax charge for the year 29 1,685 –––––––––– –––––––––– –––––––––– –––––––––– Deferred tax asset Year ended Year ended 30 Sep 22 30 Sep 21 £’000 £’000 Deferred tax asset at the start of the year 2,935 – Deferred tax credit for the year 51 2,935 –––––––––– –––––––––– Deferred tax asset at the end of the year 2,986 2,935 –––––––––– –––––––––– –––––––––– –––––––––– The Group has recognised a deferred tax asset for tax losses, held by group undertakings, where the Directors believe it is probable that this asset will be recovered. As at 30 September 2022, the Group has further unused losses of £22.1 million (2021: £20.1 million) for which no deferred tax asset has been recognised in the consolidated balance sheet. Year ended Year ended Deferred tax liability – in respect of chargeable 30 Sep 22 30 Sep 21 gains on investment properties £’000 £’000 Deferred tax liability at the start of the year 4,620 – Deferred tax charge for the year 80 4,620 –––––––––– –––––––––– Deferred tax liability at the end of the year 4,700 4,620 –––––––––– –––––––––– –––––––––– –––––––––– The Directors have assessed the potential deferred tax liability of the Group as at 30 September 2022 in respect of chargeable gains that would be payable if the investment properties were sold at their financial year end valuations. Based on the unrealised chargeable gains of £18,798,000 (2021: £18,478,000) a deferred tax liability of £4,700,000 (2021: £4,620,000) has been recognised. The deferred tax asset and liability have been calculated at a corporation tax rate of 25% being the rate that has been enacted or substantively enacted by the balance sheet date and which is expected to apply when the liability is settled and the asset realised. 52 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 9. Dividends No dividend will be paid in respect of the year ended 30 September 2022 (2021: nil). 10. (Loss)/profit per share (Loss)/profit per share is calculated as the (loss)/profit attributable to ordinary shareholders of the Company for the year of £53,000 (2021: profit of £26,525,000) divided by the weighted average number of shares in issue throughout the year of 58,015,099 (2021: 53,064,275). There are no diluting amounts in either the current or prior years. 11. Plant, machinery and office equipment Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 At the start of the year – – – – Additions 991 – – – –––––––––– –––––––––– –––––––––– –––––––––– At the end of the year 991 – – – –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– During the year, the Group acquired plant, machinery and office equipment that will be required to operate the restaurant, beverage and events businesses at 1 The Island Quarter. Depreciation is recognised so as to write off the cost of these assets, over their estimated useful economic lives, using the straight line method at 25% per annum. As the venue at 1 The Island Quarter was only partly operational from 14 September 2022 no depreciation has been recognised in the period to 30 September 2022. 12. Investment properties Freehold investment properties Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 At the start of the year 17,750 16,500 – – Additions 148 791 – – Disposals (17,898) – – – Revaluation surplus – 459 – – –––––––––– –––––––––– –––––––––– –––––––––– At the end of the year – 17,750 – – –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– The Group’s retail park in Cross Hands, Carmarthenshire was sold in the year for net proceeds of £18.3m realising a profit in the year of £0.4m. As at 30 September 2021, Cross Hands was valued by Knight Frank LLP in their capacity as external valuers. The valuation was prepared on a fixed fee basis, independent of the property value and undertaken in accordance with RICS Valuation – Global Standards on the basis of fair value, supported by reference to market evidence of transaction prices for similar properties. It assumed a willing buyer and a willing seller in an arm’s length transaction and reflected usual deductions in respect of purchaser’s costs and SDLT as applicable at the valuation date. The independent valuer made various assumptions including future rental income, anticipated void costs and the appropriate discount rate or yield. 53 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 12. Investment properties (continued) The fair value of Cross Hands was determined using an income capitalisation technique whereby contracted rent and market rental values were capitalised with a market capitalisation rate. This technique is consistent with the principles in IFRS 13 and uses significant unobservable inputs, such that the fair value was classified as Level 3 in the fair value hierarchy as defined in IFRS 13. For Cross Hands, the key unobservable inputs were the net initial yields and expiry void periods. Net initial yields were estimated for the individual units at between 5.0% and 9.5% and expiry void periods were projected at between 6 and 12 months. The principal sensitivity of measurement to variations in the significant unobservable outputs was that decreases in net initial yields and void periods would increase the fair value. The historical cost of the Group’s investment properties as at 30 September 2022 was £nil (2021: £14,242,000). The Group’s revenue for the year includes £433,000 derived from properties leased out under operating leases (2021: £1,152,000). The Group’s revenue also includes the reversal of a £1,194,000 rent spreading debtor following the sale of Cross Hands. 13. Investment properties under construction Freehold land and buildings Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 At the start of the year 70,500 19,761 – – Additions 23,591 16,407 – – Revaluation surplus 320 28,718 – – Movement in introductory fee provision (1,411) 5,614 – – –––––––––– –––––––––– –––––––––– –––––––––– At the end of the year 93,000 70,500 – – –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– Investment properties under construction comprise the freehold land and buildings at The Island Quarter in Nottingham which are held for current or future development as investment properties and reported in the balance sheet at fair value. The valuations of the Group’s investment properties are inherently subjective as they are based on the valuers’ assumptions which may not prove to be accurate and which, as a result, are subject to material uncertainty. This is particularly true for The Island Quarter given its scale, lack of comparable evidence and the early stage position of this substantial development where relatively small changes to the underlying assumptions of key parameters, such as rental levels, net initial yields, construction costs, finance costs and void periods can have a significant impact both positively and negatively on the resulting valuation. In preparing their valuation, Knight Frank have utilised market and site specific data, their own extensive knowledge of the real estate sector, professional judgement and other market observations as well as information provided by the Company’s Executive Directors. The resulting models and assumptions therein have also been reviewed for overall reasonableness by the Conygar Board. Inevitably in a complex model like this, and as noted above, variations in assumptions can lead to widely differing values. The Board have considered the valuation in the context of their experience and believe the value of approximately £2.5 million per acre is justifiable. 54 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 13. Investment properties under construction (continued) The valuation was prepared on a fixed fee basis, independent of the property value and undertaken in accordance with RICS Valuation – Global Standards on the basis of fair value, supported by reference to market evidence of transaction prices for similar properties. It assumes a willing buyer and a willing seller in an arm’s length transaction and reflects usual deductions in respect of purchaser’s costs and SDLT as applicable at the valuation date. The independent valuer makes various assumptions including future rental income, anticipated void costs and the appropriate discount rate or yield. The fair value of Nottingham has been determined using an income capitalisation technique whereby contracted rent and market rental values are capitalised with a market capitalisation rate. This technique is consistent with the principles in IFRS 13 and uses significant unobservable inputs, such that the fair value has been classified in all periods as Level 3 in the fair value hierarchy as defined in IFRS 13. For Nottingham, the key unobservable inputs are the net initial yields, construction costs, rental income rates, construction financing costs and expiry void periods. Net initial yields have been estimated for the individual units at between 4.35% and 7.0%. The principal sensitivity of measurement to variations in the significant unobservable outputs is that decreases in net initial yields, construction costs, financing costs and void periods will increase the fair value whereas reductions to rental income rates would decrease the fair value. The historical cost of the Group’s investment properties under construction as at 30 September 2022 was £62,566,000 (2021: £36,168,000). The Group’s revenue for the year includes £271,000 derived from properties leased out under operating leases (2021: £80,000). 14. Investment in subsidiary undertakings Company 30 Sep 22 30 Sep 21 £’000 £’000 At 30 September 16 16 –––––––––– –––––––––– –––––––––– –––––––––– Listed below are the wholly-owned subsidiary undertakings of the Group at 30 September 2022. Country of % of Company name Principal activity registration equity held Conygar Holdings Ltd** Holding company England 100% Conygar Haverfordwest Ltd** Property trading and development England 100%* Conygar Holyhead Ltd** Property trading and development England 100%* Conygar Nottingham Ltd** Property investment England 100%* Nohu Limited** Property investment England 100%* Parc Cybi Management Company Limited** Management company England 100% Conygar Developments Ltd** Dormant England 100%* Conygar Wales PLC** Dormant England 100%* The Island Quarter Student Property Company Ltd** Property investment England 100%* The Island Quarter Student Operating Company Ltd** Dormant England 100%* The Island Quarter Canal Turn Operating Company Ltd** Restaurant and events operations England 100%* The Island Quarter Management Company Ltd** Dormant England 100%* The Island Quarter Careers Ltd** Recruitment and HR England 100%* 55 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 14. Investment in subsidiary undertakings (continued) Country of % of Company name Principal activity registration equity held The Island Quarter Propco 2 Ltd** Dormant England 100%* The Island Quarter Propco 3 Ltd** Dormant England 100%* The Island Quarter Propco 4 Ltd** Dormant England 100%* Conygar ZDP PLC** Dormant England 100% Lamont Property Holdings Ltd*** Holding company Jersey 100%* Conygar Ashby Ltd*** Property investment Jersey 100%* Conygar Cross Hands Ltd*** Property investment Jersey 100%* * Indirectly owned. Subsidiaries with the same registered office as the Company. ** *** Subsidiaries incorporated in Jersey with a registered office at 3rd Floor, 44 Esplanade, St Helier, Jersey JE4 9WG. 15. Development and trading properties Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 At the start of the year 20,192 19,952 6,570 7,165 Additions 924 1,510 – – Disposals (3,690) (595) (3,690) (595) Development costs written off * (289) (675) – – –––––––––– –––––––––– –––––––––– –––––––––– At the end of the year 17,137 20,192 2,880 6,570 –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– * The costs incurred in connection with the planning and design for our scheme at Holyhead Waterfront have been written off in the year to retain the carrying value as at 30 September 2022 at £5.0 million. Development and trading properties are reported in the balance sheet at the lower of cost and net realisable value. The net realisable value of properties held for development requires an assessment of the underlying assets using property appraisal techniques and other valuation methods. Such estimates are inherently subjective as they are made on assumptions which may not prove to be accurate and which can only be determined in a sales transaction. 16. Inventories Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 Food and drink 32 – – – –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– Inventories recognised as an expense in the year totalled £82,041 (2021: £nil). 56 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 17. Trade and other receivables Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 Trade receivables 70 127 – 14 Amounts owed by group undertakings – – 77,296 60,193 Other receivables 423 1,229 192 257 Prepayments and accrued income 277 1,305 196 164 –––––––––– –––––––––– –––––––––– –––––––––– 770 2,661 77,684 60,628 –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– Trade and other receivables are measured on initial recognition at fair value, and are subsequently measured at amortised cost using the effective interest rate method, less any impairment. Impairment is calculated using an expected credit loss model. 18. Trade and other payables Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 Amounts owed to group undertakings – – 13,619 8,618 Social security and payroll taxes 56 55 56 55 Trade payables 938 2,300 15 12 Other payables – – 40 – Accruals and deferred income 611 1,012 104 102 –––––––––– –––––––––– –––––––––– –––––––––– 1,605 3,367 13,834 8,787 –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– Trade and other payables are recognised initially at fair value, and are subsequently measured at amortised cost using the effective interest rate method. 19. Provision for liabilities and charges 30 Sep 22 30 Sep 21 £’000 £’000 At the start of the year 5,614 – Paid in the year (2,807) – Movement in provision in the year (1,411) 5,614 –––––––––– –––––––––– At the end of the year 1,396 5,614 –––––––––– –––––––––– –––––––––– –––––––––– As at 30 September 2021, the Group was party to a services agreement and introduction fee agreement in connection with its investment property at Nottingham. The fee payable, under the terms of each agreement, in connection with introductory and other services, was to be calculated on the earlier of the date of sale of the property or 22 December 2021 with settlement to follow, subject to agreement between each party, 31 business days after the fee calculation has been finalised. In January 2022, the introductory fee, calculated at £2.807 million, was paid and the longstop date for the services agreement calculation extended until 22 December 2023.The provisions at 30 September 2022 and 30 September 2021 have been calculated by reference to the value of the property at each balance sheet date after allowing for a priority return and applicable costs. There are no provisions within the Company in the current or previous years. 57 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 20. Share capital Authorised share capital: 30 Sep 22 30 Sep 21 £ £ 140,000,000 (2021: 140,000,000) Ordinary shares of 5p each 7,000,000 7,000,000 ––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– Allotted and called up: No £’000 As at 30 September 2020 53,591,590 2,680 Cancellation of treasury shares (1,092,000) (55) ––––––––––––– ––––––––––––– As at 30 September 2021 52,499,590 2,625 Placing of own shares 7,138,998 357 ––––––––––––– ––––––––––––– As at 30 September 2022 59,638,588 2,982 ––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– At the Company’s Annual General Meeting held on 20 December 2021, resolutions were passed to enable the Company to complete the placing of 7,138,998 Ordinary shares of 5p each at a placing price of 150p per share. The premium received from each placing share over their 5p nominal value, net of fees paid in connection with the placing, resulted in a £10.16 million credit to the Company’s share premium account. At a General Meeting of the Company on 28 March 2022 a further resolution was passed to enable the cancellation of the share premium account, subject to approval of the Court, such that the amount cancelled can be credited to a distributable reserve. On 22 April 2022, an application was submitted to the Court to request the cancellation which was duly confirmed by the Court on 10 May 2022 and completed on 12 May 2022. In December 2010, the Group began a share buyback programme and during the year ended 30 September 2022 purchased nil (2021: 1,092,000) shares on the open market at a cost of £nil (2021: £1,217,000). On 16 September 2021, 1,092,000 ordinary shares of 5p each were transferred out of treasury and cancelled. 21. Capital commitments As at 30 September 2022, the Group had contracted capital commitments, not provided for in the financial statements, of £32,060,000 (2021: £12,800,000) relating to the construction, development or enhancement of the Group’s investment and trading properties. £31,171,000 of which is projected to be incurred over the next financial year and relates to a letter of intent provided by a group undertaking to the contractor of the student accommodation development to enable the continued progression of this development whilst debt financing arrangements are put into place. The Group’s commitments in this regard are expected to be ultimately financed partly out of the Group’s own cash deposits and partly from debt, for which we expect to provide a further update in the coming weeks. As at 30 September 2022, the Company had contracted capital commitments of £nil (2021: £nil). 58 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 22. Related party transactions The Company has made advances to and received advances from the following subsidiaries in order to provide both long term and additional working capital funding. All amounts are repayable upon demand, non-interest bearing and will be repaid from the trading activities of each group undertaking. The amount owed to the Company by Conygar Haverfordwest Limited is net of a £15,140,000 (2021: £15,130,000) provision following the write down in the carrying value of Haverfordwest in a previous year. 30 Sep 22 30 Sep 21 Subsidiaries £’000 £’000 Conygar Nottingham Limited 37,140 33,538 Nohu Limited 13,049 469 The Island Quarter Student Property Company Limited 11,151 – Conygar Haverfordwest Limited 9,478 8,818 Conygar Holyhead Limited 4,224 3,824 The Island Quarter Canal Turn Operating Company Limited 2,087 – The Island Quarter Careers Limited 153 – Parc Cybi Management Company Limited 14 3 Conygar Holdings Limited (6,864) (6,867) Conygar Cross Hands Limited (4,995) 13,541 Conygar Ashby Limited (1,710) (1,702) Conygar Wales PLC (50) (50) –––––––––– –––––––––– 63,677 51,574 –––––––––– –––––––––– –––––––––– –––––––––– During the year, the Company received a management fee of £50,000 (2021: £50,000) from Conygar Holyhead Limited in respect of management services. During the year, the Company charged a management fee of £nil (2021: £62,500) to Conygar Cross Hands Limited, for management services in connection with the retail park development. 23. Profit/(loss) of parent company As permitted by Section 408 of the Companies Act 2006, the profit and loss account of the Company is not presented as part of these financial statements. The parent company’s profit for the year amounts to £1,561,000 (2021: loss of £1,191,000). 24. Financial instruments The policies and risk management arrangements, as set out in this note, apply to both the Group and Company. Treasury policies The objective of the Group’s treasury policies is to manage the Group’s financial risk, secure cost effective funding for the Group’s operations and to minimise the adverse effects of fluctuations in the financial markets on the value of the Group’s financial assets and liabilities, on reported profitability and on the cash flows of the Group. The Group finances its activities with a combination of cash and short term deposits. Other financial assets and liabilities, such as trade receivables and trade payables, arise directly from the Group’s operations. The Group may also finance its activities with bank loans and enter into derivative transactions to manage the interest rate risk arising from the Group’s operations and its sources of finance. Throughout the year, and as at the balance sheet date, no group undertakings were party to any bank loans or derivative instruments. 59 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 24. Financial instruments (continued) The management of cash is monitored regularly with summary cash statements produced on a monthly basis and discussed in management and board meetings. The approach is to provide sufficient liquidity to meet the requirements of the business in terms of funding developments and potential acquisitions. Surplus funds are invested with a broad range of institutions. At any point in time, at least half of the Group’s cash is held on instant access or short term deposit of less than 30 days. Financial risk management The main risks associated with the Group’s financial assets and liabilities are set out below, together with the policies currently applied by the Board for their management. Market risk Market risk in financial assets and liabilities is defined as the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The Group’s market risk arises from open positions in interest bearing assets. Market risk – interest rate risk The Group’s interest bearing assets comprise cash and cash equivalents. As at 30 September 2022, £17.1 million was held on instant access accounts with floating interest rates and £0.3m was held in secured accounts, as performance bonds, in connection with the development of a spine road at Haverfordwest. Changes in market interest rates therefore affect the Group’s finance income. Market risk – currency risk All the Group’s assets and liabilities are denominated in Sterling therefore the Group has no exposure to currency risk. Credit risk Credit risk is the risk of financial loss to the Group if a counterparty fails to meet its contractual obligations. The Group’s principal financial assets include its cash deposits and trade and other receivables. The carrying amount of financial assets recorded in the financial statements represents the Group’s maximum exposure to credit risk without taking account of the value of any collateral obtained. In the event of default by an occupational tenant, the Group will suffer a rental shortfall and incur additional costs. The Directors continually monitor tenant arrears in order to anticipate, and minimise the impact of, defaults by occupational tenants and, if necessary, will apply rigorous credit control procedures to facilitate the recovery of trade receivables. Under IFRS 9, the Group is required to provide for any expected credit losses arising from trade receivables and contract assets. For all assured shorthold tenancies, credit checks are performed prior to acceptance of the tenant. Regulated tenants are incentivised through the benefit of their tenancy agreement to avoid default on their rent. Taking these factors into account, the risk to the Group of individual tenant default and the credit risk of unprovided trade receivables are considered low. The Directors have provided for rental and other arrears due from various tenants which amount to £200,000 as at 30 September 2022 (£118,000 as at 30 September 2021) and which remain outstanding at the date of signing these financial statements. The table below sets out the movement in the bad debt provision during the year. The impaired receivables are based on a review of expected credit losses. Impaired receivables and receivables not considered to be impaired are not material to the financial statements and, therefore, no further analysis is provided. 60 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 24. Financial instruments (continued) Provision for expected credit losses 30 Sep 22 30 Sep 21 £’000 £’000 At the start of the year 118 49 Provided in the year 95 69 Written off in the year (13) – –––––––––– –––––––––– At the end of the year 200 118 –––––––––– –––––––––– The credit risk on cash deposits is managed through the Company’s policies of monitoring counterparty exposure and the use of counterparties of good financial standing. At 30 September 2022, the credit exposure from cash held with banks was £17.4 million which represents 14.0% of the Group’s net assets. All cash deposits at the balance sheet date are placed with banks, whose credit ratings are acceptable to the Board, on instant access accounts or as performance bonds. Should the credit quality or the financial position of the banks currently utilised significantly deteriorate, the unsecured cash deposits would be moved to alternative banks. Liquidity risk Liquidity risk is the risk that the Group will not be able to meet its financial commitments as they fall due. The Group seeks to manage its liquidity risk by ensuring that sufficient cash is available to meet its obligations for a period of at least 12 months. The following tables set out the Group’s and Company’s financial assets and liabilities, all of which are due within one year. The tables have been drawn up based on the undiscounted cash flows of financial liabilities, based on the earliest date on which the Group and Company can be required to pay. Financial assets: Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 Cash and cash equivalents 17,361 13,657 16,733 12,956 Trade receivables and accrued income 92 127 17 14 Other receivables (excluding VAT) 199 253 192 240 –––––––––– –––––––––– –––––––––– –––––––––– 17,652 14,037 16,942 13,210 –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– Financial liabilities: Group Company 30 Sep 22 30 Sep 21 30 Sep 22 30 Sep 21 £’000 £’000 £’000 £’000 Trade payables and other accrued expenses 1,566 3,175 172 138 –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– –––––––––– Capital risk management The Board’s primary objective when managing capital is to preserve the Group’s ability to continue as a going concern, in order to safeguard its equity and provide returns for shareholders and benefits for other stakeholders, whilst maintaining an optimal capital structure to reduce the cost of capital and sustain the future development of the business. 61 The Conygar Investment Company PLC NOTES TO THE ACCOUNTS (continued) 24. Financial instruments (continued) The Group does not currently have any borrowing, but may utilise borrowing in the future to fund development projects. When doing so the Group will seek to ensure that it can stay within agreed covenants with its lenders. At both 30 September 2022 and 30 September 2021, the capital structure of the Group consisted of cash and cash equivalents, and equity attributable to the shareholders of the Company (comprising share capital, retained earnings and capital redemption reserves). In managing the Group’s capital structure, the Board considers the Group’s cost of capital. In order to maintain or adjust the capital structure, the Group keeps under review the amount of any dividends, share buy backs or other returns to shareholders. Details of significant accounting policies adopted, including the criteria for recognition, the basis of measurement and the basis on which income and expenditure are recognised, in respect of each class of financial asset, financial liability and equity instrument are disclosed in the accounting policies in note 1. At each balance sheet date, all financial assets and liabilities were measured at amortised cost. The fair value of the Group’s financial assets and liabilities is not considered to vary from amortised cost due to the short term nature of these financial assets and liabilities. 25. Events after the balance sheet date There are no significant events since the balance sheet date that require disclosure in the financial statements. 62 The Conygar Investment Company PLC GLOSSARY OF TERMS AGM AIM Conygar Default EPS IFRS NAV Net initial yield Passing rent PBSA PBT QCA Code Tenant break UK Annual General Meeting The AIM market of the London Stock Exchange PLC The Conygar Investment Company PLC The failure of a tenant to comply with a provision in their lease Earnings per share, calculated as the earnings for the year after tax attributable to members of the Company divided by the weighted average number of shares in issue in the year International Financial Reporting Standards adopted for use in the European Union Net asset value Annual net rents expressed as a percentage of the investment property valuation The annual gross rental income excluding the effects of lease incentives Purpose build student accommodation Profit before taxation The UK’s quoted companies alliance corporate governance guidelines for small and mid-size quoted companies. An option in a lease for a tenant to terminate that lease early United Kingdom 63 The Conygar Investment Company PLC (Company Number 04907617) (the “Company”) NOTICE OF ANNUAL GENERAL MEETING NOTICE IS HEREBY GIVEN that the 2022 Annual General Meeting of the Company will be held at the offices of The Conygar Investment Company PLC, First Floor, Suite 3, 1 Duchess Street, London W1W 6AN on Monday, 19 December 2022 at 10:00am to consider and, if thought fit, pass the resolutions below: Resolutions 1 to 8 are proposed as ordinary resolutions and resolutions 9 and 10 are proposed as special resolutions. ORDINARY BUSINESS Ordinary resolutions 1. To receive and adopt the Company’s annual accounts for the financial year ended 30 September 2022 together with the directors’ report and the auditors’ report on those accounts. 2. To approve the directors’ remuneration report for the financial year ended 30 September 2022. 3. To re-appoint Saffery Champness LLP as auditor of the Company to hold office from the conclusion of this meeting to the conclusion of the next meeting at which accounts are laid before the Company. 4. To authorise the Directors of the Company to agree the remuneration of the auditors. 5. To re-appoint Bimaljit Singh Sandhu, who retires by rotation, as a Director of the Company. 6. To re-appoint Christopher James David Ware, who retires by rotation, as a Director of the Company. SPECIAL BUSINESS 7. (a) That the Directors be and are generally and unconditionally authorised for the purposes of section 551 of the Companies Act 2006 (the “Act”) to exercise all the powers of the Company to allot shares in the Company and grant rights to subscribe for, or convert any security into shares in the Company provided that this authority shall be limited to the allotment of up to an aggregate nominal amount of £750,000 (comprising 15,000,000 Ordinary Shares) and provided that this authority (unless renewed, varied or revoked by the Company in a general meeting) is for a period expiring on the earlier of (i) the conclusion of the next Annual General Meeting of the Company or (ii) the expiry of 15 months from the passing of this resolution; and (b) the Company may, before such expiry of this authority, make an offer or agreement which would or might require the shares to be allotted or rights to subscribe for, or convert any security into shares to be granted after such expiry and the Directors may allot shares or grant rights to subscribe for, or convert any security into shares in pursuance of such offer or agreement notwithstanding that the authority conferred by this resolution has expired. This authority is in substitution for all subsisting authorities to allot any shares in the Company and to grant rights to subscribe for or convert any security into shares in the Company to the extent unused. 8. That the maximum fees payable to Directors under article 108.1 of the Company’s Articles of Association be increased from £100,000 a year in aggregate to £300,000 a year in aggregate, and any existing or prior breach of this Article by the Directors hereby be ratified. 64 The Conygar Investment Company PLC NOTICE OF ANNUAL GENERAL MEETING (continued) Special resolutions 9. That subject to the passing of resolution 7 above, the Directors be and are hereby generally and unconditionally empowered pursuant to sections 570 (1) and 573 of the Act to allot equity securities (within the meaning of section 560(1) of the Act) wholly for cash pursuant to the authority conferred by resolution 7 and / or by way of a sale of treasury shares as if section 561(1) of the Act did not apply to any such allotment, provided that this power shall be limited to the allotment of equity securities: (a) in connection with an offer of such securities by way of rights to holders of Ordinary Shares in proportion (as nearly as may be practicable) to their respective holdings of such shares, but subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to treasury shares, fractional entitlements or any legal or practical problems under the laws of any territory, or the requirements of any regulatory body or stock exchange; (b) otherwise than pursuant to sub-paragraph (a) above up to an aggregate nominal amount of £750,000 (comprising 15,000,000 Ordinary Shares); and this power (unless renewed, varied or revoked by the Company in a general meeting) shall expire on the earlier of (i) the conclusion of the next Annual General Meeting of the Company after the passing of this resolution and (ii) the date falling 15 months after the date of the passing of this resolution, save that the Company may, before such expiry make an offer or agreement which would or might require equity securities to be allotted, or treasury shares to be sold after such expiry and the Directors may allot equity securities, or sell treasury shares, in pursuance of any such offer or agreement notwithstanding that the power conferred by this resolution has expired. The authority granted by this resolution shall replace all existing authorities previously granted to the Directors to allot equity securities for cash or by way of a sale of treasury shares as if section 561 (1) of the Act did not apply. 10. That the Company be and is generally and unconditionally authorised for the purposes of section 701(1) of the Act to make one or more market purchases (within the meaning of section 693(4) of the Act) on the London Stock Exchange of ordinary shares of £0.05 each (each an “Ordinary Share”) in the Company provided that: (a) the maximum aggregate number of Ordinary Shares authorised to be purchased is 14.99% of the Ordinary Shares in issue immediately following the Annual General Meeting at which this authority to purchase is granted; (b) the minimum price (excluding expenses) which may be paid for such shares is £0.05 per share; (c) (d) (e) the maximum price (excluding expenses) which may be paid for an Ordinary Share shall not be more than an amount equal to the higher of (i) 105% of the average of the middle market quotations for an Ordinary Share as derived from The London Stock Exchange Daily Official List for the five business days immediately preceding the date on which the Ordinary Share is purchased and (ii) the higher of the price of the last independent trade of and the highest current independent bid for, an Ordinary Share on the London Stock Exchange; unless previously renewed, varied or revoked, the authority conferred shall expire on the earlier of the conclusion of the Company’s next Annual General Meeting and 15 months from the date of passing this resolution; and the Company may make a contract or contracts to purchase Ordinary Shares under the authority conferred prior to the expiry of such authority which will or may be executed wholly or partly after the expiry of such authority and may make a purchase of Ordinary Shares in pursuance of any such contract or contracts. Registered Office By Order of the Board 1 Duchess Street D Baldwin London Company Secretary W1W 6AN 21 November 2022 65 The Conygar Investment Company PLC NOTICE OF ANNUAL GENERAL MEETING (continued) Notes Entitlement to attend and vote 1. In accordance with Regulation 41 of the Uncertificated Securities Regulations 2001, only those members registered in the Company's register of members at: • 10:00am on 15 December 2022; or • if this meeting is adjourned, 48 hours prior to the adjourned meeting (excluding non-working days), shall be entitled to attend and vote at the Meeting. Changes to the register of members after the relevant deadline shall be disregarded in determining the rights of any person to attend and vote at the Meeting. 2. Only the holders of Ordinary Shares registered in the Company shall be entitled to attend and vote at the Meeting. Appointment of proxies 3. As a member of the Company, you are entitled to appoint a proxy to exercise all or any of your rights to attend, speak and vote at the Meeting and you should have received a proxy form with this Notice of Meeting. You can only appoint a proxy using the procedures set out in these notes and the notes to the proxy form. 4. A proxy does not need to be a member of the Company but must attend the Meeting to represent you. Details of how to appoint the Chairman of the Meeting or another person as your proxy using the proxy form are set out in the notes to the proxy form. If you wish your proxy to speak on your behalf at the Meeting, you will need to appoint your own choice of proxy (not the Chairman) and give your instructions directly to them. 5. You may appoint more than one proxy provided each proxy is appointed to exercise rights attached to different shares. You may not appoint more than one proxy to exercise rights attached to any one share. 6. If you do not give your proxy an indication of how to vote on any resolution, your proxy will vote or abstain from voting at his or her discretion. Your proxy will vote (or abstain from voting) as he or she thinks fit in relation to any other matter which is put before the Meeting. A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of votes for or against the resolution. 7. You can register your vote(s) for the Annual General Meeting either: • by logging on to www.shareregistrars.uk.com, clicking on the “Proxy Vote” button and then following the on-screen instructions (you can locate your log-in details on the top of the proxy form); • by post or by hand to Share Registrars Limited, 3 The Millennium Centre, Crosby Way, Farnham, Surrey, GU9 7XX using the proxy form accompanying this notice; • in the case of CREST members, by utilising the CREST electronic proxy appointment service in accordance with the procedures set out in note 14 below. In order for a proxy appointment to be valid the proxy must be received by Share Registrars Limited by 10:00am on 15 December 2022. Appointment of proxy using hard copy proxy form 8. The notes to the proxy form explain how to direct your proxy to vote on each resolution or withhold their vote. To appoint a proxy using the proxy form, the form must be • completed and signed; • sent or delivered to the Company at Share Registrars Limited, 3 The Millennium Centre, Crosby Way, Farnham, Surrey, GU9 7XX and; • received by the Company no later than 10:00am on 15 December 2022. In the case of a member which is a company, the proxy form must be executed under its common seal or signed on its behalf by an officer of the company or an attorney for the company. Any power of attorney or any other authority under which the proxy form is signed (or a duly certified copy of such power or authority) must be included with the proxy form. 9. If a member appoints a proxy or proxies and then decides to attend the Meeting in person and vote using his poll card, then the vote in person will override the proxy vote(s). If the vote in person is in respect of the member's holding, then all proxy votes will be disregarded. If, however, the member votes at the meeting in respect of less than the member's entire holding, then if the member indicates on his polling card that all proxies are to be disregarded, that shall be the case, but if the member does not specifically revoke proxies, then the vote in person will be treated in the same way as if it were the last received proxy and earlier proxies will only be disregarded to the extent that to count them would result in the number of votes being cast exceeding the member's entire holding. If you do not have a proxy form and/or believe that you should have one or if you require additional forms, please contact Share Registrars Limited. Appointment of proxy by joint members 10. In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only the appointment submitted by the most senior holder will be accepted. Seniority is determined by the order in which the names of the joint holders appear in the Company's register of members in respect of the joint holding (the first-named being the most senior). 66 The Conygar Investment Company PLC NOTICE OF ANNUAL GENERAL MEETING (continued) Changing proxy instructions 11. To change your proxy instructions simply submit a new proxy appointment using the methods set out above. Note that the cut-off time for receipt of proxy appointments (see above) also applies in relation to amended instructions; any amended proxy appointment received after the relevant cut-off time will be disregarded. Where you have appointed a proxy using the hard-copy proxy form and would like to change the instructions using another hard-copy proxy form, please contact Share Registrars Limited. If you submit more than one valid proxy appointment, the appointment received last before the latest time for the receipt of proxies will take precedence. Termination of proxy appointments 12. In order to revoke a proxy instruction, you will need to inform the Company using the following method: • by sending a signed hard copy notice clearly stating your intention to revoke your proxy appointment to Share Registrars Limited (Proxies), 3 The Millennium Centre, Crosby Way, Farnham, Surrey, GU9 7XX. In the case of a member which is a company, the revocation notice must be executed under its common seal or signed on its behalf by an officer of the company or an attorney for the company. Any power of attorney or any other authority under which the revocation notice is signed (or a duly certified copy of such power or authority) must be included with the revocation notice. The revocation notice must be received by Share Registrars Limited no later than 10:00am on 15 December 2022. If you attempt to revoke your proxy appointment but the revocation is received after the time specified then, subject to the paragraph directly below, your proxy appointment will remain valid. Appointment of a proxy does not preclude you from attending the Meeting and voting in person. If you have appointed a proxy and attend the Meeting in person, your proxy appointment will automatically be terminated. Communication 13. Except as provided above, members who have general queries about the Meeting should email the Company Secretary at davidbaldwin@conygar.com (no other methods of communication will be accepted). You may not use any electronic address provided either: • in this notice of general meeting; or • any related documents (including the proxy form), to communicate with the Company for any purposes other than those expressly stated. Appointment of proxies through CREST 14. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so for the Annual General Meeting and any adjournment(s) thereof by using the procedures described in the CREST Manual (available via euroclear.com). 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 using the CREST service to be valid, the appropriate CREST message (a “CREST Proxy Instruction”) must be properly authenticated in accordance with CRESTCO Limited’s specifications and must contain the information required for such instructions, as described in the CREST Manual. The message, regardless of whether it relates to the appointment of a proxy or to 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 7RA36 by the latest time(s) for receipt of proxy appointments specified above. 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 Applications 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 CRESTCO Limited does not make available special procedures in CREST for any particular messages. 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 or her 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 CREST by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting service providers 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 (as amended). 67 The Conygar Investment Company PLC NOTICE OF ANNUAL GENERAL MEETING (continued) Corporate representatives If a corporation is a member of the Company, it may by resolution of its directors or other governing body authorise one or more persons to act as its representative or representatives at the Meeting and any such representative or representatives shall be entitled to exercise on behalf of the corporation all the powers that the corporation could exercise if it were an individual member of the Company. Corporate representatives should bring with them either an original or certified copy of the appropriate board resolution or an original letter confirming the appointment, provided it is on the corporation’s letterhead and is signed by an authorised signatory and accompanied by evidence of the signatory’s authority. Issued shares and total voting rights 15. As at 21 November 2022 (being the last business day prior to the publication of this Notice) the Company’s issued share capital consists of 59,638,588 ordinary shares, carrying one vote each. Therefore, the total voting rights in the Company as at 21 November 2022 are 59,638,588. Documents on display 16. Copies of the Executive Directors' service contracts with the Company and any of its subsidiary undertakings and letters of appointment of the Non-Executive Directors are available for inspection at the registered office of the Company during the usual business hours on any weekday (Saturday, Sunday or public holidays excluded) from the date of this notice until the conclusion of the Annual General Meeting. Resolution on Directors’ fees 17. Under the Company's existing articles of association ("Existing Articles"), there is a cap on Directors' fees of £100,000 in aggregate each year. This limit was set when the Existing Articles were adopted in 2013. The Board considers it appropriate to increase the annual limit to £300,000 to provide flexibility and headroom for possible market increases, the appointment of new directors, and to enable the Board to execute any future succession plans. Any increases in the fees that are paid to Directors under this limit will be in line with the latest remuneration report which is approved by shareholders. 68 The Conygar Investment Company PLC Report and accounts 30 September 2022 Perivan 264665
Continue reading text version or see original annual report in PDF format above