ANNUAL REPORT & ACCOUNTS 2022
Evolving
our Group
Dewhurst Group plc Annual report & accounts 2022 00 01 Financial highlights
STRATEGIC REPORT
02 Chairman’s statement
04 Dewhurst Group at a glance
06 Group Managing Director’s review
11 Principal risks and uncertainties
12 Section 172(1) Stakeholder compliance statement
14 Financial review
16 Group five year review
GOVERNANCE
17 Report of the Directors
20 Sustainability report
25 Board of Directors
GROUP FINANCIAL STATEMENTS
26 Consolidated statement of comprehensive income
27 Consolidated statement of financial position
28 Consolidated statement of changes in equity
29 Consolidated cash flow statement
30 Notes to the financial statements
COMPANY FINANCIAL STATEMENTS
50 Company statement of changes in equity
51 Company statement of financial position
52 Company cash flow statement
OTHER INFORMATION
53 Report of the independent auditor
58 Notice of meeting
59 Group companies
60 Advisers and company information
FINANCIAL HIGHLIGHTS
Maintaining
growing sales
£57.6m
Revenue £ million
£8.8m
Operating profit* £ million
2022 57.6
2022 8.8
2021 56.2
2021 9.2
2020 55.6
2020 8.6
2019 56.4 65.9†
2019 7.7 8.8†
2018 45.7 54.5†
2018 6.0 6.7†
60.00p
14.75p
Earnings per share Pence
Dividend per share Pence
2022 60.00
2022 14.75
2021 65.33 86.98^
2021 14.00
2020 51.78
2020 13.00
2019 32.09
2019 13.00
2018 39.41 39.41
2018 12.50
* Operating profit before goodwill write down, amortisation of acquired intangibles, gain on property disposal, GMP equalisation
and cyber attack remediation costs
† Total including discontinued operations
^ Total including gain arising on the disposal of old premises at Dupar Controls Inc.
Dewhurst Group plc Annual report & accounts 2022 01
CHAIRMAN’S STATEMENT
Planning our
succession
Richard Dewhurst
Non-executive Chairman
02 Dewhurst Group plc Annual report & accounts 2022
Results
I am pleased that the Group is able to
report increased sales this year, but
disappointed that adjusted operating
profit was slightly down on reduced
margins. Group sales for the year to
30 September 2022 increased 2.3%
to £57.6 million (2021: £56.2 million).
Adjusted operating profit before the
cyber attack remediation costs and last
year’s amortisation of acquired
intangibles and gain on the sale of
a property was £8.8 million (2021:
£9.2 million) and profit before tax was
£7.2 million (2021: £9.6 million).
Although reported sales were slightly
up overall, at constant currencies sales
were broadly flat. Transport and
Highways fell back a further 16% this
year with no cycleway schemes
compared to a residue of projects in
2021. Keypad sales recovered from
the low levels experienced during the
pandemic-affected 2020-21 period.
The Lift division improved 3% with
stronger sales in the UK and
particularly North America, offset by
lower sales in Australia. Currency
movements were responsible for
an increase in reported sales of
£1.2 million, with the pound
weakening against most currencies
and the US & Canadian dollars
strengthening.
Our continuing profitability and strong
balance sheet enable us to propose an
increase in our final dividend by 0.5p,
making an increase of 0.75p for the
year. If approved this would result in a
total dividend for 2022 of 14.75p per
share which is 5.4% up on 2021.
Operations and people
I would like to pay tribute to our
employees for working through the
challenges of this year. The previously
reported cyber attack in May disrupted
our operations for several weeks and
Senior management
transition
From 1 October 2022,
John Bailey took on the CEO
role and will continue to be
supported by David Dewhurst
as strategic advisor.
remediation costs affected our profits.
Our employees put in a tremendous
effort to help us recover and do our
best to minimise the impact on our
customers. It has also been a year in
which it has been difficult to recruit
sufficient staff to support our
operations. Despite this we delivered
solid results in the circumstances.
In common with many companies, we
have experienced rapidly rising costs in
many of the commodities and
components we use. Whilst we have
increased prices during the year, we
have not been able to recover all of
these increased costs, with a
corresponding impact on our operating
margin. Whilst it is important to
protect our margin as much as we can,
it is also crucial to support our
customer relationships and honour our
long-term commitments.
After driving the growth of the Group
for more than 30 years David Dewhurst
stepped back from his full time role of
Group Managing Director at the end of
the financial year. David has played a
key role in shaping the Group and
driving its strategy to broaden its
markets for a very long time. His
energy, decisiveness and determination
have been instrumental in the Group’s
growth. On behalf of all shareholders
I want to thank him for his huge
contribution to the success of the
Group. John Bailey has moved over
from managing A&A to take on the
role of CEO for the Group from
1 October 2022. David will be
supporting John in the role of strategic
advisor to ensure a successful transition
in the senior management team. I am
delighted that John is taking on the
CEO role. John has worked with David
and myself for many years in several of
the Group’s businesses and shares our
values. There are plenty of challenges
for businesses at present and I am
confident John will take on these
challenges with enthusiasm and help
to build the senior team for long-term
success.
ideas to improve recruitment and
retention. At some companies we have
not yet seen the full impact of energy
price rises, but these are going to come
through during the first half.
With the strength of our balance sheet
we are continuing to invest to increase
our resilience to these challenges and
to improve our operational and
environmental performance. We
continue to look for opportunities to
invest in growth and will be happy to
commit our cash when suitable
opportunities are found that align with
the Group strategy.
Our continuing
profitability and
strong balance
sheet enable an
increased dividend
Investment
We recently established a Group fund
to provide investment in projects to
improve our environmental
sustainability. I am delighted that we
have completed a major project this
year under the scheme to install a solar
panel array on the roof of our Feltham
factory. Even with November’s gloomy
weather this has contributed 16% of
the site’s electricity needs since
commissioning in October.
Outlook
Group sales in the first quarter are
looking as though they will be similar
overall to last year.
Lift product demand in Australia is a
little softer, primarily as a result of a
reduction in major projects and the
outlook for the UK is expected to be
weaker with a recession underway or
looming, In North America the
economic conditions are stronger and
we have a reasonable pipeline of
projects, which should carry us through
the first half at least.
For our other product sectors,
keypad sales are expected to be slightly
stronger in the short term, continuing
the bounce back from the pandemic
lull, while sales of Highways and
Transport products are forecast to
show steady improvement over
the year.
Cost pressures on materials are likely to
be a continuing concern, but we are
working hard to mitigate these effects.
It seems that the worst of the staff
shortages following the pandemic have
eased, but we continue to explore
Dewhurst Group plc Annual report & accounts 2022 03
DEWHURST GROUP AT A GLANCE
Our global
reach
SALES BY REGION
24%
40%
36%
NORTH AMERICA
UK, EUROPE & MIDDLE EAST AUSTRALIA & ASIA
EMPLOYEES BY REGION
67
177
97
NORTH AMERICA
UK & EUROPE
AUSTRALIA & ASIA
04 Dewhurst Group plc Annual report & accounts 2022
We are a global supplier
of quality components to the
lift, transport and keypad
industries
NORTH AMERICA
UK & EUROPE
AUSTRALIA & ASIA
Dupar Controls Inc.
Dewhurst Ltd
UK & Europe
P&R Liftcars Pty Ltd
North America & Canada
Australia & New Zealand
Asia
Dewhurst UK Ltd
Dupar Controls Inc.
P&R Liftcars Pty Ltd
Dewhurst (Hong Kong) Ltd
Elevator Research Manufacturing Corp.
A&A Electrical Distributors Ltd
Australian Lift Components Pty Ltd
A&A Electrical Distributors Ltd
Elevator Research Manufacturing Corp.
Australian Lift Components Pty Ltd
Traffic Management Products Ltd
Traffic Management Products Ltd
Lift Material Australia Pty Ltd
Lift Material Australia Pty Ltd
Dewhurst (Hungary) Kft
Dewhurst (Hungary) Kft
Dual Engraving Pty Ltd
Dual Engraving Pty Ltd
Dewhurst (Hong Kong) Ltd
16/09/2021
Dewhurst Group plc Annual report & accounts 2022 05
GROUP MANAGING DIRECTOR’S REVIEW
Strengthening
our business
David Dewhurst
Group Managing Director
06 Dewhurst Group plc Annual report & accounts 2022
Business review
The Group’s principal activity in the
year continued to be the manufacture
of electrical components and control
equipment for industrial and
commercial capital goods. The Group
maintained its position as a speciality
supplier of equipment to lift, transport
and keypad sectors. A business review
of the Group’s operations is dealt
with below in operating highlights
and in the Chairman’s statement
on page 2.
Key performance indicators
The Directors believe that the key
financial performance indicators
relevant to the Group are earnings per
share, adjusted operating profit, profit
before tax and return on equity which
are stated in the five-year review on
page 16. The key non-financial
performance indicators relevant to the
Group are quality measures and
on-time deliveries to our customers.
Operating highlights
The business environment has generally
been better than we anticipated at the
start of the year.
It has been refreshing to return to
some form of normality after two
trading years of uncertainty caused by
the pandemic. Despite business having
settled down, the environment we find
ourselves in today is very different to
that in which we operated prior to the
pandemic. There are still significant
supply chain issues both in terms of
supply and rising costs of materials.
However we are able to mitigate those
to a certain extent. The biggest post
pandemic challenge that we faced
during the year was in human
resources and the availability of labour.
Our people are key to the success of
our businesses and around the world
we have found it very challenging to
recruit the people we need. This put
Train Dispatch Equipment
Unit (TDEU)
This has been designed to
create a standard approach
for train dispatch staff by
bringing together the Train
Ready To Start control unit
and the Dispatcher Indicator
Unit in one convenient and
easy to use system.
regrinds our plastic waste back into
pellets. We are now able to use 10%
of recycled plastic in our mouldings
and to use 100% recycled material
when purging our moulding machines.
Our pushbutton products are
manufactured from polycarbonate,
which whilst being extremely strong
and durable, can be damaged by
aggressive cleaning agents. Since the
pandemic we have seen increased use
of these cleaning agents in lifts. For
some time we have been researching
new plastics which have improved
resistance to chemical attack, whilst
still being strong. This year we found a
new plastic that has these qualities and
we are currently launching our
pushbutton range in this new material
across our markets.
Our antibacterial pushbuttons have
continued to prove very successful and
Investing in IT to
reduce the impact
of malicious
attacks
Contributing to the
Elizabeth Line
Dewhurst were selected to
supply pushbuttons and lift
position indicators for the
Elizabeth Line. The classic
square-shaped US96-EN
Jumbo pushbutton
was chosen, maintaining
a consistent identity.
Dewhurst Group plc Annual report & accounts 2022 07
significant stresses on our staff,
particularly senior management.
Early in the second half of the year we
suffered an extremely serious cyber
attack, which impacted all our
businesses. We worked hard to
minimise any impact to our customers
and by and large we were successful in
that respect. The financial impact of
the attack was significant but the
speed with which we resolved it,
ensured that there was no material
impact to trading revenues. It is
frustrating that our IT defences were
breached and this is becoming an all
too common situation within the
business community. Although it is
virtually impossible to totally protect
your business from these types of
attack, we are investing to ensure
the chance of a repeat is minimised
and the impact of another attack far
less serious.
The spirit shown by all our staff after
the attack was impressive. The recovery
put a great deal of additional workload
onto staff in our businesses and we are
very grateful for the support they gave.
The business has faced some stiff
challenges this year. To have delivered
these results in the face of these
challenges is a credit to the team and
I would like to thank all our colleagues
for their hard work in the past year.
UNITED KINGDOM
Dewhurst Limited
Sales grew strongly at Dewhurst Ltd led
by increased demand for our products
particularly from our overseas
customers.
We worked hard throughout the year
to reduce the environmental impact of
our manufacturing. One initiative that
proved quite successful was the
purchase of a grinding machine which
GROUP MANAGING DIRECTOR’S REVIEW
Our NonCrete Bio
Polymer bollard
won the Green
Apple Environment
Award
the manufacture of our products.
Our new NonCrete Bio Polymer bollard
recently won the Green Apple
Environment Award. The award
recognises companies that promote
environmental best practice around
the world.
A&A Electrical Distributors (A&A)
Sales grew marginally at A&A over the
year despite the fact that A&A (due to
its high percentage of same day sales)
was the only company to be impacted
in terms of lost sales through the cyber
attack. Margins at A&A were broadly in
line with the previous year.
John Bailey’s move to Group Chief
Executive Officer created a vacancy at
A&A and we are very pleased to
welcome Dean White as the new
Managing Director. Dean was
previously a Director of Schindler UK
and has a wealth of experience in the
lift industry.
A&A has focussed on implementing
core changes at operational and
process level this year. The
implementation of Tempo within
Syspro as part of our supply chain
strategy, has given us the opportunity
to improve the accuracy of our
inventory and streamline the
purchasing process. This has enabled
us to safely reduce inventory levels by
around 10% whilst maintaining an
inventory availability to our customers
at 98% or above.
With Tempo in place, we have had
more time to look at the supply chain,
review previous price increases, and
manage these by agreeing price freezes
and rebate schemes with some of
our suppliers.
We have continued to refine and
improve our E-Commerce platform and
now believe that we have a industry
leading offering.
Evo-Max Traffic Bollard
The Evo-Max is a non-
illuminated retro-reflective
self-righting bollard designed
to deliver maximum visibility
at any angle. Ideal for road
junctions and locations
requiring greater lateral
visibility day and night.
at the request of the Melbourne Metro
we have added the new US91 Jumbo
to our antibacterial range of buttons.
Traffic Management Products
(TMP)
Sales fell back from the high levels we
have seen in the last two years. The
first phase of the Government’s Active
Travel Fund trial cycle schemes is now
complete. Local authorities are now
in the process of assessing those
trials before rolling out longer-term
schemes.
Demand for TMP’s traffic bollards
remained buoyant and overseas
demand for our new Evo-Max traffic
bollard was particularly strong.
At TMP we have also focused our
energies on minimising our
environmental impact and this has
been well received by our customers.
We have increased the use of bio-
polymers (derived from sugar cane) in
08 Dewhurst Group plc Annual report & accounts 2022
Strong presence at LIFTEX
A&A and Dewhurst exhibited
together at Excel which
saw record attendance
and allowed us to engage
in person again with our
customers.
A&A’s LED Shaft Lighting
LED Shaft lighting helps to
provide a well illuminated
working zone for engineers,
while still reducing energy
usage.
EUROPE
Dewhurst Hungary
After two unspectacular years,
Dewhurst Hungary saw a double digit
percentage growth in sales.
We have been concerned for some
time now about the decline in cash
usage. It seems that although it
declined during the pandemic, the
outlook for cash usage is currently
improving and in turn the demand
for ATM’s.
NORTH AMERICA
Dupar Controls
In our first full year in our new facility
we saw a double digit growth in
sales, building on last year’s record
levels. Profits also grew to a new
record, despite considerable margin
pressures.
The team at Dupar were focused on
optimising the new facility. Particular
attention was paid to storage and
material handling. We purchased a
new sheet metal racking system, which
allows single man handling of sheets
from storage onto our fibre laser
cutting machine bed.
We have also invested in our front end
processes, developing a new quote
module to our Engineer to Order
drawing package. This will generate an
automatic drawing of the fixtures
directly from the quote, significantly
enhancing the pre-order experience for
our customers.
Elevator Research & Manufacturing
(ERM)
We recovered sales at ERM after the
challenges of the previous year. We
achieved double digit sales growth
which was driven by our new Sales
Manager. The sales growth ensured
that once again ERM was in the black.
ERM have traditionally found it hard to
penetrate the California market and
our sales have never truly reflected the
potential of the market. We need to
redress this and that is the challenge
for the team at ERM.
AUSTRALIA & ASIA
Australian Lift Components (ALC)
After a run of strong years for ALC,
last year saw a reduction in sales as
the number of new commercial
property projects in Sydney declined.
We had anticipated this fall and both
sales and profits were broadly in line
with our budgets.
We continue to work hard to develop
interstate markets and we recently
won a very substantial order for
fixtures for the Melbourne Metro.
The fixtures are the first to use the
new Antibacterial Jumbo pushbutton
developed by Dewhurst.
P&R Lift Cars (P&R)
In line with ALC, P&R have experienced
a reduction of new projects in Sydney,
which is their primary market. This has
led to a considerable fall in both sales
and profits.
Throughout the year we have been
working to leverage our ALC sales
opportunities to include P&R’s offering.
We have substantially increased the
number of joint projects we have sold
where we supply both ALC fixtures and
P&R interiors. The team have been
reasonably successful with this initiative
but these projects tend to be of a
smaller size.
Lift Material
Sales grew strongly through the year to
a new record level and profits in turn
saw double digit growth also to a new
record level. Despite being based in
Sydney, Lift Material as a distributor
has truly countrywide sales and they
Dewhurst Group plc Annual report & accounts 2022 09
GROUP MANAGING DIRECTOR’S REVIEW
One Farrer Place Lift
interior
P&R designed and installed
the top end equipment
and finishes in the lift cars
for One Farrer Place. This
premium office complex has
two landmark towers and
is located in the heart of
Sydney’s financial district.
have benefitted considerably from
increased levels of service and repair
work in all states.
We have seen reasonable traction this
year on products that Lift Material
share with A&A. Prysmian cables saw
good growth as did the A&A LED shaft
lighting system.
The team at Lift Material have
completed a reorganisation of the
warehouse. There is now a much
cleaner, efficient layout. We have
installed purpose built racking for our
cable and handrail drums, allowing
easier and safer cutting to length for
customer orders.
Dual
In 2021 we saw a parts and labour
shortage in Western Australia, which
caused a delay to many of Dual’s
projects. The lift companies in Perth by
and large resolved those issues and this
year proved to be a very busy one for
Dual. Sales grew to a record level,
Chevron Tower Elizabeth
Quay
Dual provided door entrances
and lift interiors for this 29
floor tower. The building
will house Chevron’s Perth
headquarters and has
spectacular views over the
Swan River and Central Perth.
10 Dewhurst Group plc Annual report & accounts 2022
however profits, although growing
substantially, were not at record levels.
We faced some margin erosion
through material cost increases.
Dual struggled with recruitment to
cover the increased sales and this
meant that we were not able to
operate as efficiently as we would have
liked. It also put significant pressure on
the team at Dual who worked tirelessly
to meet customer project deadlines.
The labour market in Perth has
improved recently and we have been
able to take on a number of new
recruits in the last month.
Dewhurst Hong Kong
Dewhurst Hong Kong achieved double
digit sales growth and we saw a
corresponding increase in profits. There
was strong sales growth in the South
East Asia region, which was a real
achievement. It is not easy to generate
new sales outside Hong Kong when it
is not possible to travel.
The Covid-19 pandemic has been
quite a challenge for the team.
The company is the only Group
company we have not been able to
visit, due to the continued quarantine
restrictions. However Feona Lai has
remained extremely positive and
upbeat, whilst having to work in
isolation. It is our hope that quarantine
rules will be relaxed in the coming
year and we will be able to visit the
company once again.
Delivering these
results in the face
of stiff challenges is
a credit to the team
PRINCIPAL RISKS AND UNCERTAINTIES
RISK
Operational
Cyber attack. The increased reliance on
global IT systems and infrastructure means
the chance of a repeat cyber attack has
increased.
IMPACT
MITIGATION
Inability to manufacture and
deliver to customers leading
to fall in sales and profits.
Increased risk of staff
personal data being exploited
by criminals. Increased risk of
a reduction in cash as hackers
look use ransomware against
the organisation.
Restrict the Group IT network structure so any attack is
limited to one site. Ensure each business has enhanced
cyber security including multi-factor authentication, active
software patching and antivirus monitoring as well as
holding secure and offsite back ups. Ensure each business
has a manual operating process ready that can be
applied as short notice. Ensure high levels of security for
personal data.
Staff well-being, recruitment and retention.
Staff absence, high staff
turnover, difficulty recruiting
new staff.
Implement and apply IiP actions and consider flexible
benefits and ESG impacts. HR to monitor via absence
reporting. Review long-term incentive scheme.
Business Control. The geographically
diverse nature of our business means that
many subsidiary companies are remote
from our senior management.
Reduction in control and
increased risk on individual
subsidiary’s performance.
We aim to strike a balance between autonomy and
responsibility of the local management. Senior management
generally visit all subsidiaries regularly to maintain senior
contact directly with the business. We operate the same
IT system across the business so that information flow to
management is consistent.
Loss of a key customer. Because the Group
tends to operate in niche markets there are
limited numbers of major customers in
some of these markets.
Problems at a key supplier.
Reduced sales and reduced
profits.
We aim to provide key customers with excellent products
and service at a competitive price. We closely monitor
our performance with these customers to ensure we are
meeting the objectives.
Inability to maintain required
service levels.
Where necessary we dual source, if possible in different
regions, and/or hold strategic stocks of particularly time
critical key components.
Reduced sales and reduced
profits.
We monitor our markets for innovations and endeavour to
ensure we retain a competitive offering for our customers,
supported by an active product development programme.
Technological change reducing demand for
the Group’s products. Our products are
primarily human machine interfaces. These
are subject to significant technological
change at present. New ways of interacting
with machines are constantly being
developed. Also there is a trend towards
electronic payments, which reduces the
demand for cash and thus for cash
machines.
Financial
inflationary pressures.
The Group operates a defined benefit
pension scheme in the UK. This is subject
to risks in relation to liabilities caused by
changes in life expectancy and inflation.
It is also subject to risks regarding the
value of and return on investments.
Increased materials and
labour costs, reducing
margins and profits.
Potential impact on the
balance sheet and on
cash flow.
Being an international Group,
foreign currency is our most significant
treasury risk.
Changes in foreign currencies
can have a significant impact
on profit performance.
Limit the duration of our quotes to customers. Continually
monitor component cost increases and where sensible take
on additional inventory of key components to delay any
increase. Look for efficiency savings before looking to pass
these increases onto customers.
The UK defined benefit schemes were closed to new future
accrual on 30 September 2010. Our investment strategy is
designed to diversify risk and reduce volatility. A proportion
of the liabilities are covered by Liability Driven Investments
which more closely match the movements in the values
of liabilities.
Our wide international spread reduces risk to individual
markets but inevitably increases exchange rate risks.
We aim to minimise holdings of non-functional currencies at
companies around the Group, unless there are specific
reasons. The Group does not hedge operating profits.
Dewhurst Group plc Annual report & accounts 2022 11
SECTION 172(1) STAKEHOLDER COMPLIANCE STATEMENT
Section 172 of the Companies Act 2006
requires Directors to take into
consideration the interests of
stakeholders in their decision making.
They must make decisions in good faith
that they believe will most likely
promote the success of the Company
for the benefit of its members as a
whole. In making these decisions the
Directors must consider, amongst other
things:
• Likely long-term impact of their decisions
• Interests of employees and the need to act fairly between members of the Company
• The reputation of the Company and relationships with customers and suppliers
• The effect on the community and environment in which the Company operates
KEY STAKEHOLDERS
HOW WE ENGAGE
Shareholders
Employees
Customers
Suppliers
As an AIM listed business, we have a dedicated investor website with all key information
and RNS updates. We also communicate regularly with investors particularly after trading
updates as well as at the AGM.
With the lifting of Covid-19 travel restrictions, everywhere apart from China, the Group
senior management have been able to visit all subsidiaries during the year except Hong
Kong. In addition, being mindful of our carbon footprint, this has also been supported by
more regular video conferences. Within the individual companies there are regular briefing
sessions with employees on the performance of the company and key decisions and issues.
Our customers are at the heart of everything we do. We use email and social platforms to
update them about new products and regularly review any feedback we receive to
understand how we can improve their experience. Face to face meetings with our customers
are now back to normal, unless customers request a remote meeting.
We have personal relationships across our supply chain and update each other through
regular meetings and phone calls.
SIGNIFICANT EVENTS/DECISIONS 2022
EVENT/DECISION
and stakeholders considered
Cyber attack
Shareholders, potential investors and
lenders, employees, operating
companies, customers, suppliers,
government, society.
CONSIDERATIONS, ACTIONS & IMPACT
• The Executive Board convened immediately and initiated a four element approach
upon discovery of the cyber attack – 1 a business and operational continuity plan,
2 an IT system security review and recovery plan, 3 a staff and customer potential data
breach plan and 4 a communications and information plan.
• Businesses switched overnight to a manual system to ensure customer orders,
manufacturing and deliveries could be maintained whilst our IT systems were recovered
and restored.
• IT specialists were engaged to identify the method of breach and strengthen our cyber
security and IT infrastructure.
• IT specialists in conjunction with inhouse IT staff were engaged to wipe, clean, and scan
all IT hardware ready for the restored data.
• Data security experts were engaged to monitor for data leaks and give staff peace of
mind.
• We recognised the great work that our staff have done to support the business and our
customers during this challenging time.
12 Dewhurst Group plc Annual report & accounts 2022
EVENT/DECISION
and stakeholders considered
Director role changes
Shareholders, potential investors,
employees and governments.
CONSIDERATIONS, ACTIONS & IMPACT
• With Richard Dewhurst and David Dewhurst starting to step back from day-to-day
responsibilities, the Board considered John Bailey’s development and appointment to
CEO of Dewhurst Group on the 1 October 2022 as fundamental to ensure the future
success of Dewhurst.
• John Bailey is a strong and strategic leader whose people and customer centric focus
combined with his commercial experience make him ideally suited to lead the growth
of the business.
• John will be supported by David Dewhurst in his new role of strategic advisor.
• The Board felt the change in roles would bring a fresh and positive perspective to bear
on issues of strategy, performance and staff development and would build further
resilience into our businesses.
Supply chain resilience
Employees, customers and suppliers.
• We continued our regular review of actions necessary resulting from delivery
disruptions, base material increases and stock availability.
Margin pressures & inflation
Shareholders, potential investors,
employees, customers and suppliers.
Sustainability and the
environment
Shareholders, employees, customers,
suppliers and society.
• Additional stocks have been put in place at most businesses to partially mitigate
these factors.
• We have dual sourced some of our critical components to increase flexibility and
resilience.
• We have also assessed the contingency plans and readiness of suppliers and particularly
our freight suppliers to achieve dependable deliveries.
• We continually assess the effect component cost increases and inflation have on our
margins.
• Additional stocks have been put in place at most businesses to delay any price increases
for as long as possible.
• The Group has also absorbed cost increases and sought efficiency savings before looking
to pass increases on to our customers.
• The Board is monitoring and reporting its UK carbon footprint. This will be expanded to
the rest of Group going forward.
• We have recruited our ESG manager, who is driving change throughout the
manufacturing business; a more detailed report can be found in the Sustainability
section.
• We are switching electric contracts on expiry to 100% carbon neutral sources, where
we have the option, to reduce our carbon emissions and global warming.
• We continue to expand our UK electric vehicle fleet and introduced an Electric Vehicle
Salary Sacrifice scheme in the UK to further encourage staff.
• We have installed a 207 kWp capacity solar panel system at Feltham which will
hopefully supply c.30% of our Feltham site’s annual electricity usage and should reduce
our carbon footprint by 40 tonnes of CO2 annually.
The information provided in the Chairman’s report, Review of operations, Principal risks and uncertainties, S172 Stakeholder compliance
statement and the Financial review all form part of the requirement by CA2006 to be included in a Strategic report.
Dewhurst Group plc Annual report & accounts 2022 13
FINANCIAL REVIEW
Stability and
resilience
Jared Sinclair
Finance Director
14 Dewhurst Group plc Annual report & accounts 2022
Trading results
Despite the cyber attack in May 2022
forcing the Group to adapt over a
weekend and revert to manual systems
for around a month whilst our IT
systems were restored, it is pleasing to
report no significant impact on sales
and the Group is still able to report
record revenues. Customers were
understanding and our staff adapted
admirably to these temporary working
arrangements whilst continuing to
deliver to our customers which is a
testament to their hard work and
loyalty for which I and the Group
are grateful.
Lift sales overall increased 3% due to
strong UK and North America sales
which more than offset a tough year in
Australia, particularly at P&R. Transport
sales fell 16% due to no UK
Government cycle lane delineator trials
converting to projects in 2022 but this
is still 26% up on pre Covid-19 levels.
Keypads saw a resurgence as cash
starts to be used again and reported a
16% increase on 2021. Overall revenue
increased by 2.3% to £57.6 million
(2021: £56.2 million).
With increased and uncertain lead
times from suppliers, the Group
proactively increased its inventories.
This also helped to mitigate the
impact of cost increases, which
we could not fully recover. Overall
adjusted operating profit decreased
by 4.3% to £8.8 million (2021:
£9.2 million).
The various Government schemes
around the world to support
companies during Covid-19 have pretty
much now concluded everywhere, so
in 2022 the total support from all
Governments was £0.3 million (2021:
£0.2 million) of which nil (2021: £10k)
was received in the UK. As was the
case in 2021, the Group director
5.4% increase
in dividend for
the year
foreseeable needs and to invest
cash assets safely and profitably.
The policies and procedures operated
are regularly reviewed and approved by
the Board. By varying the duration of
its fixed and floating cash deposits,
the Group maximises the return on
interest earned.
The Group continues to hedge foreign
currencies internally where possible
and did not use derivatives during the
year in the form of foreign exchange
contracts to manage its currency risk,
as reported in note 24.
Dividends
The Board is proposing a final dividend
of 10.25p (2021: 9.75p). If approved,
this would be paid on 22 February
2023 and would result in a total
dividend for 2022 of 14.75p per share
which is 5.4% up on 2021 and is
covered 4.3 times by earnings.
Dividends are accounted for when paid
or approved by shareholders, and not
when proposed, therefore the
proposed final dividend for 2022 has
not been accrued at the end of the
reporting period.
There was no change in the number of
the total issued share capital of the
Company during the year.
8 December 2022
SHAREHOLDERS’ RETURN
1900p
1700p
1500p
1300p
1100p
900p
700p
500p
300p
100p
Sept
2017
Sept
2018
Sept
2019
Sept
Sept
2020 2021
Sept
2022
Ordinary share price
‘A’ ordinary share price
bonuses in 2022 exclude any benefit
from government grants received.
Although a significant proportion of
the Group’s revenue and profits are
generated and held in foreign currency,
the foreign exchange retranslation
impact on the reporting performance
of the Group this year increased
both like-for-like revenue and profit
before tax by only 2% (2021: an
increase of 1% each).
Strong cash position
The subsidiaries continued to trade
throughout 2022 without the need for
Group cash support. The Group
started and ended the year without
any bank borrowings along with a
strong cash balance of £21.8 million,
up £1.3 million from 2021.
During the year, the Group spent
£1.5 million on cyber attack
remediation costs, £1.5 million on
dividends, as well as £0.8 million on
the purchase of property, plant and
equipment. The most significant asset
addition in 2022 was £0.12 million
spent on a 207 kWp capacity solar
panel system at Feltham which has
been operational since October 2022
and hopefully will supply c.30% of our
Feltham site’s annual electricity usage,
reduce our annual carbon footprint by
40 tonnes of CO2, as well as hopefully
pay for itself within 3 years.
Pension scheme deficit
As in 2021, I am again pleased to
report a further reduction in the
pension scheme deficit. Whilst the
pension scheme assets underperformed
expectations, the liability discount rate
increased from 2.05% to 5.25% at the
year-end which means the liability
reduction more than eliminated any
asset fall. The Company paid a total of
£1.2 million deficit reduction
contributions into the pension scheme
this year and, as a result of all these
changes, the scheme deficit decreased
by £2.9 million to £1.8 million (2021:
£4.7 million).
A more detailed analysis of the
retirement benefit fund assets and
liabilities movements is reported in
note 21 and all recommendations
made by the scheme’s actuary to
eliminate the scheme deficit within an
agreed timeframe have been fully
implemented.
Capital management and
treasury policy
The Group defines capital as total
equity plus net debt. The objective
is to maintain a strong and efficient
capital base to support the Group’s
strategic objectives, provide optimal
returns for shareholders and safeguard
the Group’s assets and status as a
going concern. The Group is not
subject to externally imposed capital
requirements and the Group’s
philosophy is to have minimal or no
borrowing where possible.
The Group seeks to reduce or eliminate
financial risk to ensure sufficient
liquidity is available to meet
Dewhurst Group plc Annual report & accounts 2022 15
FINANCIAL REVIEW
GROUP FIVE YEAR REVIEW
Continuing operations
Revenue
2018
£(000)
2019
£(000)
2020
£(000)
2021
£(000)
2022
£(000)
45,730
56,446
55,617
56,249
57,565
Adjusted operating profit*
6,013
7,700
8,630
9,214
8,818
Profit before taxation
5,253
5,244
6,740
9,563
7,169
As a percentage of total equity
14.2%
12.3%
15.7%
18.1%
11.7%
Taxation
Profit after taxation
Total equity
ROTIC1
EPS^
Dividends per share
Defective parts per million
On time delivery (%)
1,710
2,149
2,061
2,110
2,051
3,543
3,095
4,679
7,453
5,118
37,008
42,680
42,826
52,731
61,533
13.1%
12.5%
13.6%
13.4%
11.6%
39.41p
32.09p
51.78p
86.98p
60.00p
12.50p
13.00p
13.00p
14.00p
14.75p
1,525
1,932
1,085
1,026
2,020
90%
90%
91%
90%
86%
* Operating profit before goodwill write down, amortisation of acquired intangibles, gain on property disposal, GMP equalisation and cyber attack
remediation costs.
1 ROTIC – Return on Total Invested Capital being Adjusted operating profit*/Total invested capital. Total invested capital is total equity adjusted for net
retirement benefit obligations and the associated deferred tax, cumulative amortisation of acquired intangibles and historical depreciation or impairments
to goodwill.
^ Earnings per share (EPS) – basic and diluted.
16 Dewhurst Group plc Annual report & accounts 2022
REPORT OF THE DIRECTORS
The Directors present their Annual
Report on the affairs of the Group
together with the financial statements
and Auditor’s report for the year ended
30 September 2022.
Results and dividends
The profit for the year, after
taxation, amounted to £5.1 million
(2021: £7.5 million).
A final dividend on the Ordinary and
‘A’ non-voting ordinary shares of
10.25p per share (2021: 9.75p) for the
financial year ended 30 September
2022 will be proposed at the Annual
General Meeting (AGM) to be held on
14 February 2023. If approved, this
dividend will be paid on 22 February
2023 to members on the register at
20 January 2023. The ex-dividend date
will be 19 January 2023.
An interim dividend of 4.50p per
share (2021: 4.25p) was paid on
16 August 2022.
A final dividend on the Ordinary and
‘A’ non-voting ordinary shares of 9.75p
per share (2020: 9.25p) which
amounted to £788k (2020: £748k) for
the financial year ended 30 September
2021 was approved at the AGM held
on 15 February 2022 and was paid on
23 February 2022 to members on the
register at 21 January 2022.
Share repurchases
There have been no share purchases
during the financial year.
Directors
The members of the Board during the
year were:
Mr R M Dewhurst
(Non-executive Chairman)
Mr D Dewhurst
(Group Managing Director)
Mr J C Sinclair
Mr J Bailey
Mr P Tett
(Non-executive)
– resigned 31 December 2021
Ms S McErlain
(Non-executive)
Mr C Holroyd
(Non-executive)
The Directors retiring by rotation
at this year’s Annual General Meeting
are Mr J C Sinclair and Mr J Bailey
who, being eligible, offer themselves
for re-election. The unexpired period
of Mr J C Sinclair and Mr J Bailey’s
service agreement is less than one year.
During the year and at the date of
approval of the accounts, the Group
maintained liability insurance for all
Directors.
DIRECTORS’ SHARE INTERESTS
The table below sets out the names of the persons who were Directors of the Company during the financial year ended
30 September 2022 together with details of their own and their families’ beneficial interests in the shares of the Company at
that date and corresponding details at 30 September 2021.
Mr R M Dewhurst
Mr D Dewhurst
Mr J C Sinclair
Mr J Bailey
Mr P Tett
Ms S McErlain
Mr C Holroyd
30 September 2022
‘A’ ordinary
shares
Ordinary
shares
30 September 2021
Ordinary
shares
‘A’ ordinary
shares
492,333
123,666
492,333
123,666
419,595
69,932
419,595
69,932
1,000
1,000
1,000
–
100
–
–
–
2,586
6,649
1,000
1,000
1,000
–
–
–
–
–
–
–
At 30 September 2022 and 30 September 2021 there were no share options allocated to the Directors. During the financial year
no Director was materially interested in any contract which was significant to the Group’s business.
Dewhurst Group plc Annual report & accounts 2022 17
REPORT OF THE DIRECTORS
DIRECTORS’ REMUNERATION
The remuneration of the Directors is shown below:
Continuing operations
Executive Directors:
Mr R M Dewhurst
Mr D Dewhurst
Mr J C Sinclair
Mr J Bailey
Non-executive Directors:
Mr R M Dewhurst
Mr P Tett (resigned 31 Dec 2021)
Ms S McErlain
Mr C Holroyd
Salary
and fees
£(000)
Bonus
£(000)
Benefits
in kind
£(000)
Pension
2022
Total
2021
Total
£(000)
£(000)
£(000)
–
128
134
163
61
5
30
30
–
94
30
53
38
–
–
–
551
215
–
3
–
2
–
–
–
–
5
–
–
15
2
–
–
–
–
–
225
179
220
99
5
30
30
96
250
164
206
72
20
10
10
17
788
828
The calculation of Group Directors’ bonuses excludes any benefit from government grants received.
SUBSTANTIAL SHAREHOLDINGS
At 20 November 2022, the Company had been advised of the following beneficial interests in excess of 3% of the Ordinary
voting share capital (other than the holdings shown under Directors’ share interests).
Mrs V E Dewhurst
651,000 Mr J H Ridley
Fidelity NorthStar Fund
201,300 Mr I Scott
138,500
118,000
Mrs B Bruce
190,208
Interactive Investor Services Nominees Ltd
100,028
At the same date the register shows interests in excess of 3% of the ‘A’ non-voting ordinary share capital (other than Directors’
holdings) of:
JIM Nominees Ltd
Mrs V E Dewhurst
665,100
Hargreaves Lansdown Nominees Ltd (15942 acct)
228,066
518,000
HSBC Global Custody Nominees (UK) Ltd
Interactive Investor Services Nominees Ltd
339,140 Mr J H Ridley
Montoya Investments Ltd (IOUAA acct)
287,000
Hargreaves Lansdown Nominees Ltd (HLNOM acct) 150,456
18 Dewhurst Group plc Annual report & accounts 2022
223,500
153,100
Group and hence for taking reasonable
steps for the prevention and detection
of fraud and other irregularities.
The Directors are responsible for the
maintenance and integrity of the
corporate and financial information
included on the Company’s website.
Legislation in the United Kingdom
governing the preparation and
dissemination of financial statements
may differ from legislation in other
jurisdictions.
By order of the Board
Jared Sinclair
Secretary
8 December 2022
Employee involvement
Meetings, chaired by Managing
Directors, are held with employee
representatives. The financial position
and prospects of the Company are
discussed together with details of
investment and changes in facilities
which are planned by management.
Opportunity is given at the meetings to
question senior executives about
matters which concern the employees.
Environment, Social and
Governance (ESG)
The Company recognises that all of its
activities have an environmental, social
and governance impact and as such a
new more detailed section on
sustainability and ESG has been
included this year on pages 20-24.
Research and development
The Group continues to invest in
research and development programmes
for new products as well as new
processes and technologies to improve
overall operational effectiveness.
Financial risks
The Group seeks to reduce or eliminate
financial risk to ensure sufficient
liquidity is available to meet
foreseeable needs and to invest cash
assets safely and profitably. These risks
are further reported in the principal
risks and uncertainties within the
Strategic report, the Financial review
and in note 24.
Going concern and future
developments
Positive steps to develop sales, control
costs and maintain a strong cash
balance have been taken by
management to ensure the Company
has adequate resources to continue in
operational existence during this
Covid-19 pandemic and for the
foreseeable future. The strong
performance, statement of position as
well as robust cash reserves lead the
Directors to continue to adopt a going
concern basis in preparing the financial
statements. Future developments are
covered in the Strategic Report.
Auditor
The current Directors have taken all the
steps that they ought to have taken to
make themselves aware of any
information needed by the Group’s
Auditor for the purposes of the 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.
A resolution will be proposed at the
Annual General Meeting to re-appoint
Jeffreys Henry LLP as the Company’s
Auditors and to authorise the Directors
to determine their remuneration.
Statement of Directors’
responsibilities
The Directors are responsible for
preparing the Annual Report and the
financial statements in accordance with
applicable law and regulations.
Company law requires the Directors to
prepare financial statements for each
financial year. Under that law the
Directors have elected to prepare the
financial statements in accordance with
International Financial Reporting
Standards as adopted by the European
Union (“IFRS”). Under company law
the Directors must not approve the
financial statements unless they are
satisfied that they give a true and fair
view of the state of affairs of the
Company and the Group and of the
profit or loss of the Group for that
period. In preparing these financial
statements, the Directors are required
to:
• select suitable accounting policies
and then apply them consistently;
• make judgements and accounting
estimates that are reasonable and
prudent;
• state that the financial statements
comply with IFRS;
• prepare the financial statements on
the going concern basis unless it is
inappropriate to presume that the
Group will continue in business.
The Directors are responsible for
keeping adequate accounting records
that are sufficient to show and explain
the Company’s and the Group’s
transactions and disclose with
reasonable accuracy at any time the
financial position of the Company and
the Group and enable them to ensure
that the financial statements comply
with the Companies Act 2006. They
are also responsible for safeguarding
the assets of the Company and the
Dewhurst Group plc Annual report & accounts 2022 19
SUSTAINABILITY REPORT
A platform
for change
INTRODUCTION FROM
THE CHAIRMAN
At Dewhurst Group, we are
committed to improving
sustainability. We have a
responsibility to limit our impact on
the environment, protect our
people and safeguard our
stakeholders and we consider these
impacts in everything we do.
We look to the values of the Group
to guide the development of our
ESG Strategy. We have always
sought to operate with integrity, to
minimise waste and to learn and
improve every year. Our priority as
a responsible business, is to aim to
embed sustainability into every
aspect of our business operations
from our supply chains through to
the communities in which we
operate. Our strategy is
underpinned with a robust
corporate governance approach
and our heritage of over 100 years
of business.
This year we have been focused on
understanding our current position
and establishing a foundation, in
order to set meaningful achievable
targets and commitments going
forwards. I very much look
forward to reporting on our
progress next year.
ENVIRONMENT
At Dewhurst Group, we aim to
minimise the environmental impact
within our operations and supply chain
and to be a recognised industry leader
in environmental initiatives. We will
educate our employees and
stakeholders to ensure we are as
effective as possible in our business
processes, to increase their awareness
and change the way they think about
the environment and sustainability, so
that we are at the forefront of industry
best practice.
By 2027 Dewhurst Group aim to
reduce Scope 1 and Scope 2 carbon
emissions by 50% compared to 2020.
We have already seen a significant
reduction through investing in green
electricity, and we will continue to
reduce our emissions through investing
in on-site electricity generation,
sourcing 100% green energy, and
offsetting where emissions are
unavoidable.
To achieve this, Dewhurst Group has
improved its environmental
management by reducing our energy
consumption and greenhouse gas
emissions. We have invested in
renewable energy on-site where
possible, implemented site specific
initiatives such as investing in more
energy-efficient equipment and electric
vehicles for our staff, decreasing water
consumption, reducing raw material
consumption and waste, and reusing
packaging materials.
EV charging points
We are encouraging
the switch to electric
vehicles with vehicle
charging points installed
at our UK sites.
Highlights
• 84% of the electricity currently used
in the Group’s European operations is
supplied by green electricity providers.
• More than 200 kg of plastic granules
reused in our injection moulding
processes annually.
• TMP’s fully recyclable NonCrete
Bio-Polymer bollard won the 2022
Green Apple Environment award for
‘Helping the Environment’.
• 207 kWp capacity solar panels
installed at our Feltham site in
October 2022, in addition to 60 kWp
solar panels already installed at Dual
Engraving in Perth, Australia.
• Water consumption reduced by 24%
at our Feltham site between 2019
and 2021.
• More than 300 kg of packaging
materials reused and circulated
between our subsidiaries annually.
• Over 210,000 litres of water saved
annually through collection of
rainwater for toilet flushing at our
Feltham site.
• New eco range of environmental
products launched at A&A, such as
our Shaftpak™ Evo range of
energy-efficient LED luminaires and
fully recyclable Ecobox solution for
oil packaging, to join our cycle
delineators from TMP which are used
extensively across the UK to promote
cleaner and safer travel.
• Natural gas consumption at our
Feltham site reduced by 56% in the
year to 30 September 2022 due to
improved energy efficiency in
production.
Priorities
• Switch non-green electricity
contracts in the UK to green
contracts by 31 December 2022 and
20 Dewhurst Group plc Annual report & accounts 2022
25% reduction
in scope 1 & 2
greenhouse gas
emissions over
two years
Caption
Caption
Solar panels at
Feltham site
207 kWp capacity solar
panels installed in
October to generate
one-third of on-site
electricity requirements.
become zero carbon in Scope 2
emissions.
ENERGY CONSUMPTION MWh
• Move to fully recyclable packaging in
all our UK companies by 2025.
Direct
2020
2021
2022
• Continue to reuse raw materials in
manufacturing processes where we
can, to reduce the total inputs and
waste generated.
• Continue to develop environmentally
sustainable products through our
circular economy mindset of cradle
to cradle.
• Expand our environmental
measurements to all overseas
subsidiaries in 2023. These include
hazardous and non-hazardous waste
generation and water and energy
consumption. We already measure
these in our UK subsidiaries as part
of our KPI monitoring and reporting.
• Educate all our employees on
sustainability best practice.
Performance
The following table provides an
overview of the energy performance in
our UK companies in the last three
fiscal years.
Our energy consumption reduced by
4% compared with 2020 and
purchased green electricity increased
by 35% in the last three years. 84% of
electricity in our UK operations was
sourced with green providers in 2022.
Our Scope 2 emissions accounted for
14% of total carbon emissions from
Scope 1 and 2.
Carbon equivalent emissions from
Scope 1 and Scope 2 activities have
been reduced by 25% in total and
40% per sale in the last three years, a
large part of which is due to our move
to green energy. Our target is to reduce
absolute emissions by 50% compared
to 2020 and become carbon neutral by
2030 in Scope 1 and 2 emissions.
Heating & transport fuels
974
907
866
Indirect
Purchased green electricity
Purchased non-green electricity
Total consumption
537
293
647
187
723
137
1,805
1,742
1,726
GREENHOUSE GAS EMISSIONS tCO2E1
Scope 1 Direct emissions from operations
2020
2021
2022
Natural gas
Transport fuels
Cooling gasses
Total Scope 1
112
90
0
202
Scope 2 Indirect emissions from electricity consumption
Market based*
Total consumption Scope 1 & 2 emissions
62
265
122
57
12
191
38
229
110
62
0
172
28
200
1 We have followed the UK Government Environmental Reporting Guidelines: Including streamlined energy and carbon
reporting guidance and the UK Government GHG Conversion Factors for Company Reporting for Dewhurst UK companies.
*Location-based; 2020:192, 2021:182, 2022:170
CARBON EMISSIONS TREND*
CARBON EMISSIONS
tCO2e/£m
tCO2e
14.0
12.0
10.0
8.0
6.0
4.0
2.0
13.4
11.6
8.1
0
2020 2021 2022
Intensity ratio (tCO2e/£m)
Carbon emissions (tCO2e)
300
250
200
150
100
50
0
Scope 1 86%
Scope 2 14%
*The graph shows the trends based on market-based emissions calculations. Location-based intensity ratios are 2020:20,
2021:19 and 2022:14 for the UK Group companies with 31% reduction.
Dewhurst Group plc Annual report & accounts 2022 21
Charity cycle
A sizeable contingent of
employees and customers
completed the 250km cycle
challenge from Leicester to
Feltham in aid of the UK Lift
Industry Charity.
34% of our
employees globally
are female in
a wide range
of office and
production roles
44% employee
engagement on
Step Challenge
Step Challenge
Amazing Walker - Scott won
the individual prize in the
step challenge with a grand
total of 1,450,000 steps
recorded in one month.
22 Dewhurst Group plc Annual report & accounts 2022
SUSTAINABILITY REPORT
PERFORMANCE
Employee turnover
Serious H&S incidents
Reduction in H&S incidents
over last three years
Employee engagement on
Step Challenge
15%
0
20%
44%
SOCIAL
Our people strategy is centred around
Dewhurst Group’s values of honesty
and integrity, and our aim is to create
and maintain an environment where
people are engaged and feel
empowered, motivated, and fulfilled.
Diversity and inclusion
Dewhurst Group is committed to
equality in terms of opportunity, where
people are recruited to the positions
which best suit their abilities. We want
to foster a culture where everyone
belongs and feels truly included, as we
believe that through diversity and
empowering our employees to share
their different perspectives, we will
make the Group stronger and more
successful long-term.
We are committed to having a
workplace which is free from
discrimination, harassment and
bullying and ensuring that all
employees are treated with dignity and
respect. Our Discrimination, Equality,
Bullying and Harassment policies are
promoted and publicised across the
Group, and Dewhurst Ltd and TMP
have been awarded silver accreditations
from Investors in People.
One woman serves on our board of six,
and women run three of our eleven
subsidiary businesses. 34% of our
employees globally are female, and we
aim to continue to promote women to
senior positions across the Group.
Health and safety
Our General Managers (“GMs”) lead
health and safety for their businesses,
and they are supported by the Group
quality team. Employees must
undertake regular health and safety
training, with further specific and
refresher training organised dependent
on role and length of employment.
The Group Board monitor and record
all near-misses and incidents,
investigate reasons why these took
place, and put in place training and
operational process changes where
appropriate to ensure incidents do not
happen again. We also take corrective
actions according to our internal audit
reports to prevent incidents. In 2023
we will implement a Group-wide
health and safety policy, which will
provide a comprehensive description of
responsibilities for health and safety
throughout the organisation.
We have updated our Coronavirus
policy in each business in line with the
UK Government’s “Living with Covid”
plan or the equivalent local government
recommendations. Our priority is
protecting the health and safety of our
employees and encouraging people to
always behave safely.
Wellbeing
The wellbeing of our staff is of
paramount importance in maintaining
an organisation with engaged, resilient
and motivated employees. This not
only includes physical health but also
mental health.
Mental health
12 of our employees have been trained
and appointed as mental health first
aiders in the UK, and we encourage an
“It’s good to talk” approach with all
employees across the Group.
Employees can take advantage of
dedicated independent mental health
support via our healthcare benefits
scheme, and we provide wellness
rooms on site to further promote
mental and physical wellbeing.
To reduce our environmental impact
and support healthier lifestyles we
encourage our employees to
participate in the Cycle to Work
Scheme.
Engagement
We are continuously listening to our
employees to ensure that working
conditions are in line with expectations.
One example is that we are currently
reviewing flexible working patterns
within our manufacturing teams. All
employees are encouraged to provide
comments and feedback via forums
such as Works Councils or one-to-ones
with their line managers, and we will
roll out a formal annual employee
engagement survey in 2023.
GMs hold regular companywide
meetings to ensure engagement with
all staff, and our quarterly newsletter
shares information and updates from
around the Group. We hold an annual
Forum located at one of our businesses
for our senior management team to
come together and discuss issues they
are facing, share solutions and best
practice, and for the Group Board to
communicate the Group’s strategy to
the team.
Community
Dewhurst Group encourages
volunteering to give back to our local
communities. In April 2022, 148 of our
employees from all over the world
volunteered to compete in teams of
four to walk the most steps over a
month long Step Challenge. The aim
was to raise money for the Hungarian
Red Cross to help the refugee situation
regarding the war in Ukraine. Dewhurst
Group employees walked nearly 47
million steps and raised over £10,000.
We continue to work on events and
initiatives as part of our drive to
working with our local communities
and achieving our social objectives.
Training and development
At Dewhurst Group our aim is to
develop, reward and retain talent. We
support a collaborative culture in which
Dewhurst Group plc Annual report & accounts 2022 23
SUSTAINABILITY REPORT
people are encouraged to come
forward with ideas for their own
regular development, and provide
continuous learning and development
opportunities to all employees for their
professional growth.
Our performance management process
includes identifying training needs for
our people. This process includes
regular one-to-ones and annual
reviews to measure performance
against documented objectives.
During the coming year we will
enhance our Group apprenticeship
programme, to take on more
apprentices and invest in our local
markets.
GOVERNANCE
The Board of Directors of Dewhurst
Group plc believe that good corporate
governance is a central element of the
successful growth and development of
the Group. The Board and its
Committees play a key role in the
Group’s governance by providing an
independent perspective to the senior
management team, and by seeking to
ensure that an effective system of
internal controls and risk management
procedures is in place. Below describes
our corporate governance structures
and processes which are reviewed
regularly and at least annually.
AIM Rule 26 from 28 September 2018
requires companies to report against
an adopted corporate governance
code. Dewhurst’s Board considers that
the QCA Corporate Governance Code
(“QCA Code”) is the most suitable
framework for smaller public
companies and, consequently, formally
adopted the QCA Code. The QCA
Code continues to be applied during its
financial year ended 30 September
2022.
The Board ensures that the Company
adopts proper standards of corporate
governance and, where appropriate,
the principles of best practice as set
out in the QCA Code. Set out on our
website (www.dewhurst-group.com)
and below is a summary of how the
Company is applying the key
requirements of the Code.
The Board comprises persons from
technical and professional qualified
backgrounds ensuring there are the
appropriate skills and capabilities to
perform their duties. These are
maintained through continuing
professional development, in-house
training and regular courses to ensure
they are up-to-date. In addition the
Directors commit all the time necessary
to fulfil their roles and there are
processes in place enabling Directors to
take independent advice at the
Company’s expense in the furtherance
of their duties and to have access to
the advice and services of the
Company Secretary.
The Board considers its Non-executive
Directors to be independent in
character and judgement; however
only Ms S McErlain and Mr C Holroyd
are technically independent as defined
by the Code.
The full Board met nine times this
year and deals with all important
aspects of the Group’s affairs. During
the year all directors were able to
attend all executive meetings.
Formal executive Director performance
evaluations are conducted annually
through appraisals. Each Non-executive
Director’s performance is evaluated as
an outcome of the formal performance
evaluations of the Committee(s) of
which they are a member.
Annual performance evaluations of
both executive Directors and
24 Dewhurst Group plc Annual report & accounts 2022
Non-executive Directors (via Committee
evaluation) identify and record
achievements and areas for
improvement in relation to annual
objectives and performance of their
role, in order to consider effectiveness.
Objectives for the forthcoming year are
defined along with identification of
how achievements will be met, target
dates and details of resource
constraints or issues to ensure that
actions are planned and taken as a
result of the evaluation process. These
objectives and the performance of the
Director are monitored monthly
through formal meetings with the
Chairman or Group Managing Director.
The Committees conduct a self-
assessment of their performance
during the year, measuring their
performance against their Terms of
Reference. The Audit committee risks
and concerns are reported in the body
of the audit report, particularly the
audit approach and key audit matters
as detailed on pages 54 to 55.
In light of the size of the Board, the
Board do not consider it necessary to
establish a Nomination committee. All
members of the Board participate in
the recruitment of members to the
Board. The Remuneration committee
does not produce a formal report. The
Remuneration committee considers
Directors’ remuneration based on
market conditions, Group values and
business objectives. We seek to set
remuneration that is competitive and
motivational whilst consistent with our
values. Bonuses for Directors are based
on profit and growth in profit and
some Directors also have bonuses
based on achieving individual personal
objectives.
BOARD OF THE DIRECTORS
The Board and
its Committees
are committed to
responsible
governance
Richard Dewhurst BA (Eng Sc), ACMA
Non-executive Chairman
David Dewhurst BSc (Elec Eng)
Group Managing Director
Age 66. Joined in 1985.
Previously with Ford Motor Co,
Ernst & Whinney, Senior Management
Consultant.
Committees: Remuneration (Chair)*
Age 61, Joined in 1987.
Previously with
Holmes & Marchant plc.
Jared Sinclair BSc, ACA
Finance Director and
Company Secretary
Age 52. Joined in 1997.
Previously with Moores Rowland,
Chartered Accountants, Audit Senior.
John Bailey
Managing Director
A&A Electrical Distributors Ltd
Age 52. Joined in 2008.
Previously with Brett Landscaping
& Building Products, Commercial
Director.
Susan McErlain BSc
Non-executive Director
Age 59. Joined in 2021.
Previously with Ultra Electronics
Holdings plc, Director of Corporate
Affairs.
Committees: Audit, Remuneration*
Charles Holroyd BSc (Elec Eng), MBA
Non-executive Director
Age 66. Joined in 2021.
Previously with Oxford Instruments plc,
Director.
Committees: Audit, Remuneration*
*Audit Committee meets twice per year, Remuneration Committee meets once per year.
Peter Tett, Non-executive Director,
resigned on 31 December 2021.
Dewhurst Group plc Annual report & accounts 2022 25
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 September 2022
Continuing operations
Revenue
Operating costs
Adjusted operating profit*
Cyber attack remediation costs+
Profit on sales of property, plant and equipment^
Amortisation of acquired intangibles
Operating profit
Finance income
Finance costs
Profit before taxation
Taxation
Profit for the period
Other comprehensive income:
Actuarial gains/(losses) on the defined benefit pension scheme
Deferred tax effect
Tax on items taken directly to equity
Total that will not be subsequently reclassified to income statement
Exchange differences on translation of foreign operations
Total that may be subsequently reclassified to income statement
Other comprehensive income/(expense) for the year, net of tax
Notes
2022
£(000)
2021
£(000)
2
3
57,565
(50,269)
56,249
(46,395)
11
5
6
7
8
21
8,818
(1,522)
–
–
7,296
64
(191)
7,169
(2,051)
9,214
–
1,751
(1,111)
9,854
20
(311)
9,563
(2,110)
5,118
7,453
1,887
(472)
200
1,615
3,563
3,563
5,178
5,344
(1,336)
224
4,232
(425)
(425)
3,807
Total comprehensive income for the year
10,296
11,260
Profit for the year attributable to:
Equity Shareholders of the Company
Non-controlling interests
Total comprehensive income for the year attributable to:
Equity Shareholders of the Company
Non-controlling interests
Basic and diluted earnings per share
Basic and diluted earnings per share – continuing operations
* Operating profit before amortisation of acquired intangibles, profit on sale of property and cyber attack remediation costs
+ Cyber attack remediation is explained further in the Strategic report
^ Gain arising on the disposal of old premises at Dupar Controls Inc.
4,849
269
5,118
9,867
429
7,030
423
7,453
10,877
383
10,296
11,260
9
9
60.00p
60.00p
86.98p
86.98p
The notes on pages 30 – 49 form part of these financial statements
26 Dewhurst Group plc Annual report & accounts 2022
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 30 September 2022
Non-current assets
Goodwill
Other intangibles
Property, plant and equipment
Right-of-use assets
Deferred tax asset
Current assets
Inventories
Trade and other receivables
Current tax asset
Cash and cash equivalents
Total assets
Current liabilities
Trade and other payables
Current tax liabilities
Short-term provisions
Lease liabilities
Non-current liabilities
Retirement benefit obligation
Lease liabilities
Total liabilities
Net assets
Equity
Share capital
Share premium account
Capital redemption reserve
Translation reserve
Retained earnings
Total attributable to equity Shareholders of the Company
Non-controlling interests
Total equity
Notes
2022
£(000)
2021
£(000)
10
11
12
22
19
14
15
16
17
18
22
21
22
20
10,105
19
19,147
2,473
118
9,626
24
17,827
2,802
1,111
31,862
31,390
7,931
12,318
281
21,764
6,597
10,008
–
20,463
42,294
37,068
74,156
68,458
7,783
–
344
505
8,632
1,798
2,193
7,571
89
343
450
8,453
4,737
2,537
12,623
15,727
61,533
52,731
808
157
329
5,065
53,525
808
157
329
1,662
48,213
59,884
51,169
1,649
1,562
61,533
52,731
The financial statements were approved by the Board of Directors and authorised for issue on 8 December 2022 and were signed
on its behalf by:
Richard Dewhurst Chairman
Jared Sinclair Finance Director
Company Registration Number: 160314
The notes on pages 30 – 49 form part of these financial statements
Dewhurst Group plc Annual report & accounts 2022 27
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 September 2022
At 30 September 2020
Exchange differences on translation
of foreign operations
Actuarial gains/(losses) on defined benefit
defined benefit pension scheme
Deferred tax effect
Tax on items taken directly to equity
Dividends paid
Profit for the year
–
–
–
–
–
–
Share
capital
account
£(000)
Share
premium
reserve
£(000)
Capital
redemption
Translation
reserve
£(000)
£(000)
Retained
earnings
interests
£(000)
Non
controlling
Total
equity
£(000)
£(000)
808
157
329
2,047
38,042
1,443
42,826
–
–
–
–
–
–
–
–
–
–
–
–
(385)
–
(40)
(425)
–
–
–
–
–
5,344
(1,336)
224
(1,091)
7,030
–
–
–
(264)
423
5,344
(1,336)
224
(1,355)
7,453
At 30 September 2021
Exchange differences on translation
of foreign operations
Actuarial gains/(losses) on defined benefit
pension scheme
Deferred tax effect
Tax on items taken directly to equity
Dividends paid
Profit for the year
808
157
329
1,662
48,213
1,562
52,731
– –
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
3,403
–
160
3,563
–
–
–
–
–
1,887
(472)
200
(1,152)
4,849
–
–
–
(342)
269
1,887
(472)
200
(1,494)
5,118
At 30 September 2022
808
157
329
5,065
53,525
1,649
61,533
The notes on pages 30 – 49 form part of these financial statements
28 Dewhurst Group plc Annual report & accounts 2022
CONSOLIDATED CASH FLOW STATEMENT
For the year ended 30 September 2022
Continuing operations
Notes
2022
£(000)
2021
£(000)
Cash flows from operating activities
Operating profit
Depreciation, amortisation and impairments
Right-of-use asset depreciation
Contributions to pension scheme, net of administration fee & GMP equalisation costs
Exchange adjustments
(Profit)/loss on disposal of property, plant and equipment
22
(Increase)/decrease in inventories
(Increase)/decrease in trade and other receivables
Increase/(decrease) in trade and other payables
Increase/(decrease) in provisions
Cash generated from operations
Interest paid
Tax paid
Interest and tax paid
Net cash from operating activities
Cash flows from investing activities
Acquisition of subsidiary undertaking
Proceeds from sale of property, plant and equipment
Purchase of property, plant and equipment
Development costs capitalised
Interest received
7,296
1,050
509
(1,137)
738
(13)
8,443
(1,334)
(2,310)
212
1
5,012
(1)
(1,712)
9,854
2,317
489
(1,357)
(49)
(1,774)
9,480
(389)
(455)
(1,213)
–
7,423
(25)
(1,896)
(1,713)
(1,921)
3,299
5,502
–
23
(789)
(5)
64
(649)
2,122
(2,500)
(15)
20
Net cash generated from/(used in) investing activities
(707)
(1,022)
Cash flows from financing activities
Dividends paid
Repayment of lease liabilities including interest
(Repayment)/Proceeds from bank borrowings
Net cash used in financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Exchange adjustments on cash and cash equivalents
9
22
24
16
(1,494)
(584)
–
(1,355)
(562)
(69)
(2,078)
(1,986)
514
2,494
20,463
787
18,139
(170)
Cash and cash equivalents at end of year
16
21,764
20,463
The notes on pages 30 – 49 form part of these financial statements
Dewhurst Group plc Annual report & accounts 2022 29
NOTES TO THE ACCOUNTS
NOTE 1 ACCOUNTING POLICIES
Basis of preparation Dewhurst Group Plc prepares its
consolidated and Company financial statements on a going
concern basis and in accordance with International Financial
Reporting Standards (IFRS) as adopted by the United Kingdom.
The Group and Company financial statements have been
prepared in accordance with those parts of the Companies
Act 2006 that are applicable to companies adopting IFRS. The
Company is registered and incorporated in the United Kingdom;
and quoted on AIM.
These are the first financial statements prepared under UK
adopted international accounting standards. On 31 December
2020, IFRS as adopted by the European Union at that date was
brought into UK law and became UK adopted international
accounting standards, with future changes being subject to
endorsement by the UK Endorsement Board. Dewhurst Group
plc transitioned to UK-adopted International Accounting
Standards in its consolidated and Company financial statements
on 1 October 2021. This change constitutes a change in
accounting framework. However, there is no change on
recognition, measurement or disclosure in the financial year
reported as a result of the change in framework.
The principal accounting policies applied in the preparation
of these financial statements are set out below. These policies
have been consistently applied to the years presented, unless
otherwise stated. The results have been prepared on the basis
of all IFRS issued by the International Accounting Standards
Board currently effective.
There are no standards that are not yet effective and that would
be expected to have a material impact on the entity in the
current or future reporting periods and on foreseeable future
transactions.
The financial statements have been prepared under the
historical cost convention and are presented in GB Pounds to
the nearest thousand (£’000).
Consolidation The consolidated financial statements
incorporate the results of Dewhurst Group Plc and all of its
subsidiary undertakings made up to 30 September 2022,
adjusted to eliminate intra-group balances, transactions, income
and expenses. The Group has used the acquisition method of
accounting to consolidate the results of subsidiary undertakings,
which are included from the date of acquisition.
Revenue Revenue is measured at the fair value of sales of
goods and services less returns and sales taxes. The Group has
analysed its business activities and applied the five-step model
prescribed by IFRS 15 to each material line of business, as
outlined below:
the customer formally accepts transfer of risk and control even
though the product has not been dispatched.
Sale of services The contract to provide a service is
established when the customer places a purchase order. The
performance obligation is to provide the service requested
either by an agreed date if it relates to the servicing of a specific
product or over an agreed period if it relates to a constant
access or monitoring service. The transaction price is the
value of the service as stated in our order acknowledgement.
The performance obligation for a specific product service is
typically met when the service is performed and so revenue is
recognised for each service when the servicing takes place. The
performance obligation for a constant access or monitoring
service is typically met over a time-based measure and so
revenue is recognised for each service on a straight-line basis
over the service period.
The Group has no material revenue of a servicing nature. The
Group’s revenue is from contracts with customers and by sale
of products which is further analysed within note 2 - segment
reporting.
Customer loyalty rebates The cost of customer loyalty
rebates is recognised within sales, with deferred revenue equal
to the estimated fair value of the loyalty rebate recognised
when the original transaction occurs. On redemption, the value
which has been redeemed is released from deferred revenue.
Government grants The Group has received government
assistance income in the period as a result of the Covid-19
pandemic. Government grants are recognised where there
is reasonable assurance that the grant will be received and
that the group will comply with the conditions attached to
them. Government grants that compensate the Group for
expenses incurred are recognised in the income statement,
as a deduction against the related expense, over the periods
necessary to match them with the related costs.
Goodwill Goodwill arising on the acquisition of a subsidiary
undertaking is the difference between the fair value of the
consideration paid and the fair value of the assets and liabilities
acquired and is recognised as an asset and reviewed for
impairment at least annually. Any impairment is recognised
immediately in the income statement and is not subsequently
reversed. On disposal of a subsidiary, the attributable
amount of goodwill is included in the determination of the
profit or loss on disposal. Goodwill arising on acquisitions
before the date of transition to IFRS has been retained at
the previous UK GAAP amount subject to being tested for
impairment at that date.
Sale of products The contract to provide a product is
established when the customer places a purchase order. The
performance obligation is to provide the product requested
by an agreed date, and the transaction price is the value of
the product as stated in our order acknowledgement. The
performance obligation is typically met when the product
is dispatched and so revenue is primarily recognised for
each product when dispatching takes place. In some limited
situations when the product is complete but the customer is
unable to take delivery the performance obligation is met when
Other intangible assets
Product research and development costs Research
expenditure is written off in the financial year in which it
is incurred. Development expenditure is written off in the
financial year in which it is incurred unless it satisfies the
criteria of IAS 38 for recognition as an intangible asset. Such
expenditure is capitalised in the consolidated statement
of financial position at cost and is amortised through the
consolidated income statement on a straight-line basis over its
estimated economic life of three years.
30 Dewhurst Group plc Annual report & accounts 2022
Acquired intangible assets An intangible resource acquired
with a subsidiary undertaking is recognised as an intangible
asset if it is separable from the acquired business or arises
from contractual or legal rights, is expected to generate future
economic benefits and its fair value can be measured reliably.
Acquired intangible assets, comprising of trademarks and
customer relationships, are amortised through the consolidated
income statement on a straight-line basis over their estimated
economic lives of between three and ten years.
Property, plant and equipment Property, plant and
equipment is stated at cost or deemed cost less accumulated
depreciation and any recognised impairment loss. Depreciation
is charged so as to write off the cost over the assets expected
useful life. The depreciation rates used are:
Property (basic structure)
1½% – on a declining balance basis
Property (fittings)
5% to 20% – on a straight-line basis
Plant and equipment
10% to 33⅓% – on a straight-line basis
Investments in subsidiaries In the accounts of the Company,
investments in subsidiaries are held as non-current assets and
stated at cost less provision for impairment.
Inventories Inventories are stated at the lower of weighted
average cost and net realisable value. Cost represents direct
materials, labour and appropriate production overheads on a
product-by-product basis. The Group provides 30% where there
is more than one year’s usage held and for all inventories where
there is no usage in the year. Usage is either units sold or units
used as components in manufacturing.
Taxation The tax expense represents the sum of the tax
currently payable and deferred tax. The tax currently payable is
based on taxable profit for the year. Taxable profit differs from
the net profit as reported in the income statement because
it excludes items of income or expense that are taxable or
deductible in other years and it further excludes items that are
never taxable or deductible. The Group’s liability for current
tax is calculated using tax rates that have been enacted or
substantively enacted by the end of the reporting period. Current
tax is charged or credited to the income statement, except when
it relates to items charged to other comprehensive income (OCI),
in which case the current tax is also dealt within the OCI. As
such the current tax savings arising from the OCI element of the
closed defined benefit pension scheme deficit contributions are
also recognised in the OCI as required by IAS 12.
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 end of the reporting period liability
method. Deferred tax liabilities are generally recognised for all
material taxable temporary differences and deferred tax assets
are only recognised to the extent that taxable profits will be
available against which deductible temporary differences can be
utilised. A deferred tax asset has been recognised in relation to
the pension scheme deficit.
Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled or the asset is
realised, based upon tax rates and laws that have been enacted
or substantively enacted by the end of the reporting period.
Deferred tax is charged or credited in the income statement,
except when it relates to items charged or credited through
other comprehensive income, in which case the deferred tax is
also dealt with through other comprehensive income.
Foreign currencies Foreign currency transactions of individual
companies are translated at the rates ruling when they
occurred. Foreign currency monetary assets and
liabilities are retranslated at the rates ruling at the end of the
reporting period. Any differences are taken to the income
statement.
The results of overseas operations are translated at the average
rates of exchange during the year and their statement of
financial positions translated into GB Pounds at the rates of
exchange ruling at the end of the reporting period. Exchange
differences which arise from translation of the opening net
assets and results of foreign subsidiary undertakings and from
translating the income statement at an average rate are taken
to other comprehensive income. All other differences are taken
to the income statement.
The treatment of tax charges or credits resulting from the
exchange differences reported above match the accounting
treatment and are either taken to other comprehensive income
or to the income statement as appropriate.
Leases The Group recognises a right-of-use asset and a
lease liability at the lease commencement date. The right-of-
use asset is initially measured at cost, comprising the initial
amount of the lease liability plus any initial direct costs incurred
and an estimate of costs to restore the underlying asset,
less any lease incentives received. The right-of-use asset is
subsequently depreciated using the straight-line method from
the commencement date to the earlier of the end of the useful
life of the asset or the end of the lease term.
The lease liability is initially measured at the present value of the
lease payments that are not paid at the commencement date,
discounted using the incremental borrowing rate.
The lease liability is measured at amortised cost using the
effective interest method by increasing the carrying amount to
reflect interest on the lease liability and by reducing the
carrying amount to reflect the lease payments made. The
lease liability is remeasured when there is a change in future
lease payments arising from a change in an index or a rate or
a change in the Group’s assessment of whether it will exercise
an extension or termination option. When the lease liability is
remeasured, a corresponding adjustment is made to the
right-of-use asset.
Payments associated with long-term leases with less than
12 months from the date of application, short-term leases or
low-value assets are recognised on a straight-line basis as an
expense in the consolidated income statement. Short-term
leases are leases with a lease term of 12 months or less. Low-
value assets mostly comprise of IT equipment and small items of
office furniture.
Dewhurst Group plc Annual report & accounts 2022 31
NOTES TO THE ACCOUNTS
NOTE 1 ACCOUNTING POLICIES CONTINUED
Employee benefits The Group operates both a defined
contribution and a defined benefit type pension scheme.
Contributions in respect of the defined contribution schemes
are charged to the income statement in the year they fall due.
The defined benefit scheme has been set up under a trust deed
with its financial assets held separately from those of the Group
and is controlled by the Trustees. The pension cost is assessed
in accordance with the advice of an independent qualified
actuary to recognise the expected cost of providing pensions
on a systematic and rational basis over the expected remaining
service lives of employees.
The liability recognised in the statement of financial position
in respect of the defined benefit pension scheme is the
present value of the defined benefit obligation at the end
of the reporting period less the fair value of scheme assets,
together with adjustments for unrecognised actuarial gains and
losses and past service costs. The defined benefit obligation
is determined by discounting the estimated future cash
outflows using interest rates of high-quality corporate bonds
approximating to the terms of the related pension liability.
Actuarial gains and losses are recognised in full in the statement
of comprehensive income. Interest on the pension scheme’s
liabilities and the expected return on the scheme’s assets are
recognised within finance costs in the income statement.
Dividends Dividend distribution to the Company’s
Shareholders is recognised in the Group’s financial statements
in the year in which dividends are approved by Shareholders or
paid, whichever is earlier.
FINANCIAL INSTRUMENTS
Trade receivables and payables Trade receivables do not
carry any interest and trade payables are not interest bearing.
Receipts and payments occur over a short period and are
subject to an insignificant risk of changes in value. The Group
provides for all trade receivables that are more than ninety days
overdue therefore the Directors consider the carrying amounts
are stated at their fair value after deduction of appropriate
allowances for expected credit losses.
Financial liabilities Financial liabilities incurred by the Group
are classified according to the substance of the contractual
arrangements entered into and measured at their amortised cost.
Cash and cash equivalents Cash and cash equivalents
comprise cash on hand and short-term deposits that are readily
convertible to a known amount of cash and are subject to an
insignificant risk of changes in value. The short-term deposits
have maturities of six months or less.
Derivative financial instruments Derivative financial
instruments are measured at fair value. Changes in the fair
value of derivative financial instruments are recognised as
income or expense in the statement of comprehensive income
as they arise.
Provisions Provisions are recognised for liabilities of uncertain
timing or amount when there is a present legal or constructive
obligation that has arisen as a result of past events, for which it
is probable that an outflow of economic benefit will be required
to settle the obligation and where the amount of the obligation
can be reliably estimated (see notes 15 and 18).
Key judgements and estimates The Group makes
judgements and assumptions concerning the future that impact
the application of policies and reported amounts. The resulting
accounting estimates calculated using these judgements and
assumptions will, by definition, seldom equal the related actual
results but are based on historical experience and expectation
of future events. The key judgements and sources of estimation
uncertainty that have a significant effect on the amounts
recognised in the financial statements are discussed below.
KEY ACCOUNTING JUDGEMENTS
Goodwill impairment The Directors review each cash
generating unit (CGU) and calculate whether its goodwill
has suffered any impairment loss, based upon the fair value
calculation. The Directors judged the 2022 fair value calculation
to be the 2022 EBITDA multiplied by an externally derived
private company price index (PCPI). This calculation is disclosed
further in note 10.
Retirement benefit obligation Determining the value of
the future defined benefit obligation requires judgement in
respect of the assumptions used to calculate present values.
These include inflation, salary increases, liability discount rate
and future mortality. Management makes these judgements
in consultation with an independent actuary. Details of the
judgements made in calculating these transactions are
disclosed in note 21, along with sensitivities. The retirement
benefit obligation is most sensitive to changes in the liability
discount rate.
KEY ACCOUNTING ESTIMATES
Provisions Provisions have been made for obsolete inventory,
expected credit losses and product warranties. These provisions
are estimates and the actual costs and timing of the future cash
flows are dependent on future events. Any difference between
expectations and the actual future liability will be accounted
for in the period when such determination is made. Details of
provisions are set out in notes 12, 14, 15 and 18.
Lease term and incremental borrowing rate The Group
determines the lease term as the non-cancellable term of the
lease, together with any periods covered by an option to extend
the lease if it is reasonably certain to be exercised. The Group is
also required to determine its incremental borrowing rate (IBR)
to measure lease liabilities. Judgement is applied based on a
series of inputs including local bank borrowing rates, country-
specific base rates and credit risk assessments of the entities
involved.
Income taxes The Group recognises expected liabilities for tax
based upon an estimation of the likely taxes due, which requires
significant judgement as to the ultimate tax determination
of certain items. The Directors determined an element of the
closed defined benefit pension scheme payment could give
rise to a potential current tax saving which under IAS 12 is
reportable in the other comprehensive income (OCI) section
of the income statement. The Directors judged the best way
to calculate this is to perform two tax computations, with and
without the OCI element, thus determining the tax difference
to be the OCI tax saving. Details of the tax charge and deferred
tax are set out in notes 7 and 19 respectively.
32 Dewhurst Group plc Annual report & accounts 2022
NOTE 2 SEGMENT REPORTING
The Group Board assess the performance of all segments on the basis of location and reports its primary segmental information
by geographical destination.
The geographical analysis by significant regions is as follows:
United Kingdom
Europe
The Americas
Asia & Australia
Other
Inter-company sales
Finance income/(costs)
2022
£(000)
19,590
5,087
15,854
22,060
41
62,632
(5,067)
Revenue
2021
£(000)
19,693
5,785
13,557
21,624
243
60,902
(4,653)
Operating profit
2021
£(000)
2022
£(000)
1,266
356
2,024
3,645
5
7,296
1,501
281
3,568
4,465
39
9,854
(127)
(291)
Consolidated revenue/profit before tax for the year
57,565
56,249
7,169
9,563
United Kingdom
Europe
The Americas
Asia & Australia
Other
2022
£(000)
24,261
5,015
19,863
24,935
82
Assets
2021
£(000)
24,036
5,516
16,018
22,761
127
2022
£(000)
4,830
1,081
2,300
4,400
12
Liabilities
2021
£(000)
6,508
1,546
2,444
5,045
184
Consolidated assets/liabilities for the year
74,156
68,458
12,623
15,727
Capital additions
2021
£(000)
2022
£(000)
Depreciation and amortisation
2021
£(000)
2022
£(000)
United Kingdom
Europe
The Americas
Asia & Australia
Other
Total Group
The secondary segmental reporting is by the following business sectors:
Sector
Lift
Transport
Keypad
Inter-company sales
349
74
275
168
1
867
228
46
1,383
898
8
2,563
559
76
283
640
1
1,559
2022
£(000)
52,647
4,144
5,841
62,632
(5,067)
1,651
113
222
610
8
2,604
Revenue
2021
£(000)
50,936
4,947
5,019
60,902
(4,653)
57,565
56,249
Dewhurst Group plc Annual report & accounts 2022 33
NOTES TO THE ACCOUNTS
NOTE 2 SEGMENT REPORTING CONTINUED
For the year ended 30 September 2022
Lift
Transport
Keypad
Total Group
2022
£(000)
65,802
4,109
4,245
Assets
2021
£(000)
61,112
3,460
3,886
74,156
68,458
Capital additions
2022
£(000)
689
126
52
867
2021
£(000)
2,448
90
25
2,563
The Group has one major customer who accounts for £4.5 million (2021: £4.6 million) of the keypad revenue which is split
across Europe, Asia and the Americas. The qualitative aspects such as the nature, timing and uncertainty of revenue, expenses,
assets and liabilities are disclosed within the Strategic report and accounting policies.
NOTE 3 OPERATING COSTS
Movement in inventory obsolescence provision
Cost of inventories recognised as an expense
Staff costs (see note 4)
Depreciation
Impairment
Amortisation
Right-of-use asset depreciation
Foreign exchange differences
Cyber attack remediation costs
Profit on sale of Dupar’s old building
Other operating charges
2022
£(000)
260
26,427
16,323
1,037
–
13
509
(83)
1,522
–
4,261
2021
£(000)
429
24,487
16,404
985
202
1,130
489
50
–
(1,751)
3,970
Operating costs
50,269
46,395
Other operating charges include a gain on sale of property, plant and equipment £13k (2021: gain of £1,774k) and auditor’s
remuneration are detailed below. Expenditure on research and development was £364k (2021: £440k).
Auditor’s remuneration:
Amounts paid to Jeffreys Henry LLP
Statutory audit services
Amounts paid to BDO LLP
Pension audit services
Taxation compliance services
Other taxation advisory services
2022
£(000)
84
12
16
35
63
The Group
2021
£(000)
77
11
15
21
47
147
124
2022
£(000)
34
12
5
35
52
86
The Company
2021
£(000)
35
11
4
21
36
71
34 Dewhurst Group plc Annual report & accounts 2022
NOTE 4 STAFF COSTS AND INFORMATION REGARDING EMPLOYEES
Costs during the year were as follows:
Wages and salaries
Social security costs
Pension costs – GMP equalisation
Pension costs – Other (see note 21)
2022
£(000)
14,573
927
–
823
The Group
2021
£(000)
14,619
942
19
824
16,323
16,404
2022
£(000)
The Company
2021
£(000)
826
98
–
53
977
653
79
19
67
818
The Group has utilised government support measures in the geographies in which it operates, including employee furlough
schemes and job keeper schemes. The total UK, Hong Kong, Hungarian, Canadian and Australian government grant income
recognised in the year in relation to these schemes was £0.3 million (2021: £0.2 million). These grants have been deducted
against the related wage and salary costs. There are no unfulfilled conditions or contingencies attached to these grants.
The average number of employees during the year was:
Office and management
Manufacturing
2022
No.
136
205
341
The Group
2021
No.
2022
No.
The Company
2021
No.
137
203
340
10
–
10
The Executive Directors comprise the key management personnel of the Group and Company in both the current and
previous years.
The total amount of the Directors’ remuneration was as follows:
Emoluments - Executive Directors
Emoluments - Non-executive Directors
2022
£(000)
607
164
771
7
–
7
2021
£(000)
702
112
814
Two Directors also received pension payments into their defined contribution schemes totalling £17k (2021: £14k).
The emoluments of the Directors are reported on page 18 of the Report of the Directors and the remuneration of the highest
paid Director during the year was £225k (2021: £250k). The highest paid Director, under the defined benefit scheme has
accrued pension of £166k (2021: £159k) and a transfer value of £1,986k (2021: £2,580k).
NOTE 5 FINANCE INCOME
Bank deposit interest
2022
£(000)
64
2021
£(000)
20
Dewhurst Group plc Annual report & accounts 2022 35
NOTES TO THE ACCOUNTS
NOTE 6 FINANCE COSTS
Interest payable on bank overdraft and loans
Interest payable on lease liabilities
Net costs on defined benefit pension scheme (note 21)
NOTE 7 TAXATION
Current tax
UK corporation tax at 19.0% (2021: 19.0%)
Adjustment on prior years tax
Overseas taxation
Deferred tax
Origination and reversal of temporary differences
Tax expense in the income statement
2022
£(000)
(1)
(105)
(85)
(191)
2022
£(000)
245
(59)
1,364
1,550
2021
£(000)
(25)
(116)
(170)
(311)
2021
£(000)
593
(26)
1,385
1,952
501
158
2,051
2,110
The tax assessed for the year is different from the standard rate of corporation tax in the UK. The differences are explained
below:
Profit before tax
Standard rate ofcorporation tax in the UK
Effects of:
Adjustments in respect of prior years
Different rate of tax on overseas earnings
Additional reduction for R&D expenditure
Expenses not deductible for tax purposes
Other permanent differences
Tax charged to other comprehensive income
Movement in deferred tax rates
Deferred tax not recognised
Effective tax rate for the year
2022
£(000)
2021
£(000)
7,169
9,563
19.0%
19.0%
(0.5%)
6.1%
(0.9%)
0.7%
(0.1%)
2.8%
(1.1%)
2.6%
(0.3%)
4.6%
(0.5%)
2.8%
(0.1%)
2.4%
(6.8%)
1.0%
28.6%
22.1%
NOTE 8 PROFIT FOR THE FINANCIAL YEAR
The parent company made a profit after tax for the financial year of £2,407k (2021: £4,954k), which has been dealt with in the
financial statements of the holding company. The Company has taken advantage of the exemption allowed under section 408 of
the Companies Act 2006 and has not presented its own income statement in these financial statements.
36 Dewhurst Group plc Annual report & accounts 2022
NOTE 9 EARNINGS PER SHARE AND DIVIDEND PER SHARE
Weighted average number of shares
For basic and diluted earnings per share
2022
No.
2021
No.
8,081,398
8,081,398
The calculation of basic and diluted earnings per share is based on the profit for the financial year of £4,848,816 and on
8,081,398 Ordinary 10p and ‘A’ non-voting ordinary 10p shares, being the weighted average number of shares in issue
throughout the financial year. There are no share options issued.
Paid dividends per 10p Ordinary share
2021 final paid of 9.75p (2020: 9.25p)
2022 interim paid of 4.50p (2021: 4.25p)
Dividends paid – The Company
Dividends paid to non-controlling interests – Dual Engraving Pty Ltd & P&R Liftcars Pty Ltd
Dividends paid – The Group
2022
£(000)
(788)
(364)
2021
£(000)
(748)
(343)
(1,152)
(342)
(1,091)
(264)
(1,494)
(1,355)
The final proposed dividend is based on 3,309,200 Ordinary 10p shares and 4,772,198 ‘A’ non-voting ordinary 10p shares, being
the latest number of shares in issue. The Directors are proposing a final dividend of 10.25p (2021: 9.75p) per share, totalling
£828k (2021: £788k). This dividend has not been accrued at the end of the reporting period.
NOTE 10 GOODWILL
Cost or valuation:
At 1 October
Exchange adjustment
Additions on acquisition of subsidiaries
At 30 September
Impairment:
At 1 October
Exchange adjustment
At 30 September
Net book value:
At 30 September 2022
At 30 September 2021
2022
£(000)
The Group
2021
£(000)
16,290
954
–
16,515
(225)
–
17,244
16,290
6,664
475
6,772
(108)
7,139
6,664
10,105
9,626
9,626
9,743
Goodwill is allocated at acquisition to the business units that are expected to benefit from that acquisition.
The remaining goodwill relates to five CGUs, four in Australia, Australian Lift Components Pty Ltd acquired in February 2000
- £1,234k (2021: £1,108k), Lift Material Australia Pty Ltd acquired in July 2005 - £879k (2021: £789k), Dual Engraving Pty Ltd
acquired in February 2013 - £1,372k (2021: £1,232k), P&R Liftcars Pty Ltd acquired in January 2017 - £1,200k (2021: £1,077k)
and one in the UK, A&A Electrical Distributors Ltd acquired in June 2018 - £5,420k (2021: £5,420k).
Goodwill values have been tested for impairment by comparing them against the fair value of the relevant CGUs. The fair value
calculations for 2022 are based on 2022 EBITDA profits multiplied by an externally derived private company price index (PCPI).
The goodwill impairment charge that arose during the current year is nil (2021: nil) and the calculations indicate sufficient
headroom such that a 15% change to key assumptions would not result in an impairment of the related goodwill.
Dewhurst Group plc Annual report & accounts 2022 37
NOTES TO THE ACCOUNTS
NOTE 11 OTHER INTANGIBLES
Cost or valuation:
At 1 October
Exchange adjustment
Additions
Disposals
At 30 September
Amortisation:
At 1 October
Exchange adjustment
Charge for the year
Disposals
At 30 September
Net book value:
At 30 September 2022
At 30 September 2021
2022
Acquired
intangibles
£(000)
2022
Other
2022
Total
£(000)
£(000)
2021
Acquired
intangibles
£(000)
2021
Other
The Group
2021
Total
£(000)
£(000)
5,859
98
–
–
5,957
5,859
98
–
–
5,957
–
–
637
9
5
–
651
613
6
13
–
632
19
24
6,496
107
5
–
6,608
6,472
104
13
–
6,589
19
24
5,883
(24)
–
–
5,859
4,772
(24)
1,111
–
5,859
–
1,111
624
(2)
15
–
637
596
(2)
19
–
613
24
28
6,507
(26)
15
–
6,496
5,368
(26)
1,130
–
6,472
24
1,139
All amortisation has been charged to the statement of comprehensive income through operating costs and no intangible items
are held as security.
38 Dewhurst Group plc Annual report & accounts 2022
NOTE 12 PROPERTY, PLANT AND EQUIPMENT
Property
£(000)
Plant and
equipment
£(000)
The Group
Total
Property
£(000)
£(000)
Plant and
equipment
£(000)
Cost or valuation:
At 30 September 2020
Exchange adjustment
Additions
Disposals
At 30 September 2021
Exchange adjustment
Additions
Disposals
16,389
(75)
1,146
(760)
16,700
1,457
37
–
9,851
(95)
1,354
(632)
10,478
731
752
(131)
26,240
(170)
2,500
(1,392)
27,178
2,188
789
(131)
6,197
–
–
(26)
6,171
–
–
–
At 30 September 2022
18,194
11,830
30,024
6,171
Depreciation:
At 30 September 2020
Exchange adjustment
Charge for the year
Impairment charge for the year
Disposals
At 30 September 2021
Exchange adjustment
Depreciation charge for the year
Disposals
2,226
(21)
224
–
(456)
1,973
100
230
–
7,067
(64)
761
202
(588)
7,378
509
807
(120)
9,293
(85)
985
202
(1,044)
9,351
609
1,037
(120)
1,115
–
103
–
(24)
1,194
–
73
–
At 30 September 2022
2,303
8,574
10,877
1,267
Net book value:
266
–
–
(81)
185
–
117
–
302
169
–
28
–
(81)
116
–
21
–
137
The Company
Total
£(000)
6,463
–
–
(107)
6,356
–
117
–
6,473
1,284
–
131
–
(105)
1,310
–
94
–
1,404
At 30 September 2022
15,891
3,256
19,147
4,904
165
5,069
At 30 September 2021
14,727
3,100
17,827
At 1 October 2020
14,163
2,784
16,947
4,977
5,082
69
97
5,046
5,179
Capital commitments contracted by the Group at 30 September 2022 for property, plant and equipment amounted to £173k
(2021: £285k) and by the Company is £39k (2021: nil).
Dewhurst Group plc Annual report & accounts 2022 39
NOTES TO THE ACCOUNTS
NOTE 13 NVESTMENTS – SHARES IN SUBSIDIARY UNDERTAKINGS
The Company
Investments (Ordinary shares) are:
Cost
Provision for impairment
Investments in subsidiary undertakings are:
Cost (after provision for impairment):
Dewhurst Ltd
A&A Electrical Distributors Ltd
Traffic Management Products Ltd
Dewhurst (Hungary) Kft
Dupar Controls Inc.
The Fixture Company
Elevator Research Manufacturing Corp.
Australian Lift Components Pty Ltd
P&R Liftcars Pty Ltd
Lift Material Australia Pty Ltd
Dual Engraving Pty Ltd
Dewhurst Australian Property Pty Ltd
Dewhurst (Hong Kong) Ltd
2022
£(000)
22,354
(7,002)
2021
£(000)
22,354
(7,002)
15,352
15,352
2022
£(000)
2021
£ (000)
–
10,886
–
72
35
–
–
1,798
933
85
1,445
97
1
–
10,886
–
72
35
–
–
1,798
933
85
1,445
97
1
15,352
15,352
The Company has eleven wholly-owned trading subsidiaries, Dewhurst Ltd, A&A Electrical Distributors Ltd and Traffic
Management Products Ltd (TMP), registered and principally operating in England, Dewhurst (Hungary) Kft, registered and
principally operating in Hungary, Dupar Controls Inc., registered and principally operating in Canada, The Fixture Company and
Elevator Research Manufacturing Corp. (ERM) registered and principally operating in the United States of America, Australian
Lift Components Pty Ltd, Lift Material Australia Pty Ltd and Dewhurst Australian Property Pty Ltd, all registered and principally
operating in Australia and Dewhurst (Hong Kong) Ltd registered and principally operating in Hong Kong. Dual Engraving Pty
Ltd and P&R Liftcars Pty Ltd which principally operate in Australia are not wholly owned but instead are owned 70% and 75%
respectively. All companies have similar principal activities to Dewhurst Group Plc, except TMP which operates solely in the
transport sector and Dewhurst Australian Property Pty Ltd, which operates solely to hold Australian Lift Components Pty Ltd’s
and Lift Material Australia Pty Ltd properties.
In addition to the trading companies above the following dormant companies are also subsidiaries of the Group - Dewhurst &
Partner Ltd, Dewhurst Hounslow Property Ltd, LiftStore Ltd, TMP Solutions Ltd and Dewhurst UK Ltd.
40 Dewhurst Group plc Annual report & accounts 2022
NOTE 14 INVENTORIES
Raw materials and components
Work-in-progress
Finished goods and goods for re-sale
2022
£(000)
2,191
793
4,947
7,931
The Group
2021
£(000)
2022
£(000)
The Company
2021
£(000)
1,234
643
4,720
6,597
–
–
–
–
–
–
–
–
Inventory above is shown net after an obsolete impairment provision of £1,597k (2021: £1,337k). There is no material difference
between the replacement cost of inventories and the amounts stated above.
NOTE 15 TRADE AND OTHER RECEIVABLES
Trade receivables
Amounts due from subsidiary undertakings (note 23)
Other receivables
Prepayments and accrued income
2022
£(000)
11,839
–
–
479
The Group
2021
£(000)
9,619
–
–
389
2022
£(000)
The Company
2021
£(000)
25
8
78
21
3
2
10
42
57
12,318
10,008
132
Trade receivables which relate solely to contracts with customers are shown net of provision for impairment. As a result of the
perceived risks declining from Covid-19 the Group released its provision for impairment by £200k down to nil (2021: £200k). The
movements in the provision for impairment of trade receivables were as follows:
At 1 October
Charge for the year
Foreign exchange
Costs recovered/(incurred)
At 30 September
2022
£(000)
349
(83)
22
(21)
267
The Group
2021
£(000)
2022
£(000)
The Company
2021
£(000)
396
(50)
(4)
7
349
–
–
–
–
–
–
–
–
–
–
At the end of the reporting period the ageing analysis of trade receivables, with normal terms being 30 days net monthly, not
provided for was as follows:
As at 30 September 2022
As at 30 September 2021
These receivables are of good credit quality.
Total
£(000)
11,839
9,619
Within
terms
£(000)
8,907
8,146
Up to 1
month
overdue
£(000)
1,850
873
Up to 2
months
overdue
£(000)
613
600
Over 2
months
overdue
£(000)
469
–
Dewhurst Group plc Annual report & accounts 2022 41
NOTES TO THE ACCOUNTS
NOTE 16 CASH AND CASH EQUIVALENTS
Cash
Short-term deposits
NOTE 17 TRADE AND OTHER PAYABLES
Trade payables
Other taxes and social security costs
Other payables
Accruals and deferred income
2022
£(000)
11,264
10,500
The Group
2021
£(000)
11,963
8,500
2022
£(000)
The Company
2021
£(000)
652
10,500
2,081
8,500
21,764
20,463
11,152
10,581
2022
£(000)
2,207
784
233
4,559
7,783
The Group
2021
£(000)
2022
£(000)
The Company
2021
£(000)
2,232
1,051
272
4,016
7,571
95
33
27
379
534
5
19
114
390
528
The Directors consider that the carrying amount of trade and other payables approximates to their fair value.
NOTE 18 SHORT-TERM PROVISIONS
Warranty provisions
2022
£(000)
344
The Group
2021
£(000)
343
2022
£(000)
–
The Company
2021
£(000)
–
Warranties, which relate to product or service defects identified within 12 months of invoice, are provided in the normal course
of business based on current issues and are costed on an assessment of future claims with reference to past claims. The provision
is in relation to replacement and change-out costs and although it is not possible to estimate the timing of crystallisation of the
potential liability it is expected that it will be utilised during the coming year. Amounts charged to the Group income statement
during the year were £27k (2021: £25k). Amounts utilised by the Group in the year were £25k (2021: £22k). There were no
amounts charged or utilised this year or last year by the Company.
42 Dewhurst Group plc Annual report & accounts 2022
NOTE 19 DEFERRED TAXATION
Deferred tax asset:
At 1 October
Transfer directly (to)/from other comprehensive income
Foreign exchange on deferred tax
Transfer (to)/from income statement
2022
£(000)
1,111
(472)
(20)
(501)
The Group
2021
£(000)
2,621
(1,336)
(16)
(158)
2022
£(000)
1,184
(472)
–
(460)
The Company
2021
£(000)
2,141
(1,336)
–
379
At 30 September
118
1,111
252
1,184
Deferred tax at 30 September relates to the following:
Defined benefit pension scheme
Provisions
Deferred tax asset
NOTE 20 SHARE CAPITAL
Authorised:
Shares of 10p each – 4,500,000 Ordinary
– 9,000,000 ‘A’ non-voting ordinary
Allotted and fully paid:
Shares of 10p each – 3,309,200 (2021: 3,309,200) Ordinary
– 4,772,198 (2021: 4,772,198) ‘A’ non-voting ordinary
2022
£(000)
450
(332)
The Group
2021
£(000)
1,184
(73)
118
1,111
2022
£(000)
450
(198)
252
The Company
2021
£(000)
1,184
–
1,184
2022
£(000)
450
900
2021
£(000)
450
900
1,350
1,350
2022
£(000)
331
477
808
2021
£(000)
331
477
808
The Ordinary shares and the ‘A’ non-voting ordinary shares rank in all respects pari passu except that the ‘A’ non-voting ordinary
shares do not carry the right to receive notices, attend or vote at meetings of the Company.
The share premium reserve arose when shares were issued and sold at above the par value, the capital redemption reserve was
created on the repurchase and cancellation of the Company’s own shares and the translation reserve represents the cumulative
foreign exchange differences on the translation of the net assets of the Group’s foreign operations from their functional currency
to the presentation currency of the parent.
Dewhurst Group plc Annual report & accounts 2022 43
NOTES TO THE ACCOUNTS
NOTE 21 RETIREMENT BENEFIT OBLIGATION
The Group operates pension schemes in the UK, Canada, USA, Australia and Hong Kong, and also complies with Hungarian
state legislation in relation to retirement provision. During the year the UK operated both defined contribution schemes, the
assets of which are held in independently administered funds, and a defined benefit scheme, the assets of which are held in
Trustee administered funds. The total pension cost for the Group was £823k (2021: £843k). All, apart from nil (2021: £19k)
relating to defined benefit pension scheme GMP equalisation and £25k (2021: £36k) of defined benefit pension protection fund
levy fees relates to defined contribution schemes. The active UK, Hungarian, Canadian, USA, Australian and Hong Kong schemes
are of the defined contribution type and the cost to the Group amounted to £799k (2021: £788k). There was an accrued charge
of £18k at the end of the reporting period in respect of the defined benefit scheme (2021: £19k). On 30 September 2010 the
Company closed the defined benefit scheme to future accrual and offered all existing members future pension benefits in a
new Group defined contribution scheme. There were contributions during the year of £1,170k into the defined benefit scheme
(2021: £1,404k) and the contributions for next year will be £1,404k. The funding policy is to review triennially the funding
position with the actuary and from that review the trustees, Company and actuary agree the funding arrangements for the next
three years.
The pension cost relating to the UK defined benefit scheme is assessed in accordance with the advice of qualified actuaries using
the new scheme specific funding regime. The latest actuarial valuation of the scheme was on 1 June 2021. It has been assumed
that future investment yields would be at 3.3% per annum (pre-retirement) and 1.8% (post-retirement).
At the date of the latest actuarial valuation of the UK scheme, the market value of the assets of the scheme were £47.8 million
(2018: £37.4 million) and the funding level on the on-going valuation basis was 90% (2018: 78%). The 2021 actuarial valuation
takes account of secured pensioners when assessing the assets and liabilities of the fund. All the recommendations made by the
scheme’s actuary to eliminate the scheme deficit have been fully implemented.
IAS 19 Employee benefits
Under IAS 19 a snapshot is taken of the retirement benefit fund assets and liabilities to coincide with the Company’s financial
year-end. Thus movements in equity and bond markets and in discount rates may create some volatility in the calculation of the
scheme assets and liabilities. The weighted average duration of the liabilities is 18 years and payments from the scheme assets
are made on a monthly basis.
Assumptions
The following actuarial assumptions, updated to 30 September 2022 by the scheme actuary and taking account of Covid-19,
have been used in preparing the disclosures required under IAS 19:
Retail price index expected to rise by
Pensionable salaries will increase by
Deferred pensions and pensions in payment will increase by
Liabilities discounted at a rate of
Expected return on pension scheme assets
Expected lifetime for a member retiring at the accounting date – for males
Future expected lifetime for a member retiring in 20 years’ time – for males
– for females
The sensitivities regarding the principal assumptions used are set out below:
Change in assumption
Assumption
– for females
Liability Discount Rate
Rate of inflation (RPI)
Rate of mortality
Increase/decrease by 0.1%
Increase/decrease by 0.1%
Increase/decrease by 1 year
2022
2021
3.65%
n/a
3.65%
5.25%
5.25%
22.4 yrs
24.9 yrs
23.7 yrs
26.3 yrs
3.45%
n/a
3.45%
2.05%
2.05%
21.9 yrs
23.9 yrs
23.2 yrs
25.4 yrs
Impact on plan liabilities
Decrease/increase by 6.4%
Increase/decrease by 2.7%
Increase/decrease by 2.7%
44 Dewhurst Group plc Annual report & accounts 2022
IAS 19 requires the value of annuities purchased in respect of pensioners and widow(er)s to be taken into current year
calculations.
Equities
Bonds
Other
Total fair value of scheme assets
Present value of scheme liabilities
Scheme deficit
Related deferred tax asset
Net pension liability
Fair value at
30 Sept 2022
£(000)
Fair value at
30 Sept 2021
£(000)
Fair value at
30 Sept 2020
£(000)
21,819
9,732
1,839
33,390
(35,188)
(1,798)
450
38,246
9,247
1,335
48,828
(53,565)
(4,737)
1,184
35,157
7,150
3,482
45,789
(57,057)
(11,268)
2,141
(1,348)
(3,553)
(9,127)
The amounts charged to operating profit in relation to current service costs (GMP Equalisation) are nil (2021: £19k and 2020: nil).
Amounts charged to other finance costs:
Interest on pension scheme assets
Interest on pension scheme liabilities
Net benefit/(cost)
Amounts recognised in the statement of comprehensive income (SOCI):
Experience gains and losses arising on the scheme assets
Experience gains and losses arising on the scheme liabilities
Changes in assumptions underlying the present value of the scheme liabilities
2022
£(000)
1,002
(1,087)
(85)
2022
£(000)
(16,506)
(336)
18,729
2021
£(000)
730
(900)
(170)
2021
£(000)
2,588
54
2,702
2020
£(000)
792
(970)
(178)
2020
£(000)
754
133
(2,773)
Actuarial gains/(losses) recognised in SOCI
1,887
5,344
(1,886)
History of experience gains and losses:
Experience gains and losses arising on the scheme assets
Percentage of scheme assets
Experience gains and losses on scheme liabilities
Percentage of the present value of scheme liabilities
Total amount recognised in SOCI
Percentage of the present value of scheme liabilities
2022
£(000)
(16,506)
(49.4%)
(336)
1.0%
1,887
(5.4%)
2021
£(000)
2,588
5.3%
54
(0.1%)
5,344
(10.0%)
2020
£(000)
754
1.6%
133
(0.2%)
(1,886)
3.3%
Dewhurst Group plc Annual report & accounts 2022 45
NOTES TO THE ACCOUNTS
NOTE 21 RETIREMENT BENEFIT OBLIGATION CONTINUED
The movement in the scheme assets, liabilities and the net deficit are as follows:
Deficit in scheme at 1 October
Movement in the year:
Benefits paid
Contributions
Administration charge
Current Service Costs (GMP equalisation)
Other finance costs
Actuarial gains/(losses)
2022
Assets
£(000)
2022
Liabilities
£(000)
2022
Total
£(000)
2021
Total
£(000)
2020
Total
£(000)
48,828
(53,565)
(4,737)
(11,268)
(10,570)
(1,071)
1,170
(33)
–
1,002
(16,506)
1,071
–
–
–
(1,087)
18,393
–
1,170
(33)
–
(85)
1,887
–
1,404
(28)
(19)
(170)
5,344
–
1,404
(38)
–
(178)
(1,886)
Deficit in scheme at 30 September
33,390
(35,188)
(1,798)
(4,737)
(11,268)
Included in retained earnings is £11,037k (2021: £12,924k) being the cumulative actuarial losses on the defined benefit pension
scheme.
NOTE 22 RIGHT-OF-USE ASSETS AND LEASE LIABILITIES
Right-of-use assets
Cost or valuation:
At 30 September 2021
Exchange adjustment
Additions
Disposals
At 30 September 2022
Depreciation:
At 30 September 2021
Exchange adjustment
Charge for the year
Disposals
At 30 September 2022
Net book value:
At 30 September 2022
At 30 September 2021
Property
£(000)
Plant and
equipment
£(000)
Property
£(000)
Plant and
equipment
£(000)
2022
Total
£(000)
3,631
154
73
(22)
65
–
68
(15)
3,573
(37)
30
–
118
3,836
3,566
33
–
35
(15)
53
65
32
829
47
509
(22)
1,363
333
(7)
470
–
796
2,473
2,770
2,802
3,240
2021
Total
£(000)
3,626
(37)
48
(6)
3,631
353
(7)
489
(6)
829
2,802
3,273
53
–
18
(6)
65
20
–
19
(6)
33
32
33
3,566
154
5
(7)
3,718
796
47
474
(7)
1,310
2,408
2,770
46 Dewhurst Group plc Annual report & accounts 2022
Lease liabilities
Cost or valuation:
At 30 September 2021
Exchange adjustment
Additions
Interest
Repayments
At 30 September 2022
Of which:
Current lease liabilities
Non-current lease liabilities
2022
£(000)
2021
£(000)
2,987
116
74
105
(584)
3,416
(31)
48
116
(562)
2,698
2,987
505
2,193
2,698
450
2,537
2,987
Of the non-current lease liabilities £1,983k falls due in the next 2 to 5 years (2021: £1,954k) and £210k after 5 years (2021:
£583k). Other operating charges include short-term leases paid and expensed on a straight-line basis of £205k (2021: £204k).
NOTE 23 RELATED PARTIES
The controlling party of the Group is Dewhurst Group Plc. Transactions between the Company and its subsidiaries, which are
related parties to the Company, have been eliminated on consolidation. However during the year, in the Company’s financial
statements, there have been the following transactions: group management charges, interest on loans at floating rates on a
commercial basis and dividend income received. All transactions are settled by cash. Any loans given are secured on the assets of
the relevant company and repayable on demand.
Company related party transactions
Management charges to subsidiaries
Rent charges to subsidiaries
Interest income received
Expected credit gains/(losses) charged to income statement
Dividend income received
Dividends paid to Directors
Loans and trade receivables due
2022
£(000)
1,354
150
8
100
4,258
159
408
2021
£(000)
1,189
150
11
214
4,552
150
502
Dewhurst Group plc Annual report & accounts 2022 47
NOTES TO THE ACCOUNTS
NOTE 24 FINANCIAL INSTRUMENTS
The Group’s policies towards using financial instruments to manage interest rate, liquidity and currency exposure risks are
explained in the Financial review on page 15. The Group defines capital as total equity plus net debt. The objective is to maintain
a strong and efficient capital base to support the Group’s strategic objectives, provide optimal returns for Shareholders and
safeguard the Group’s assets and status as a going concern. The Group is not subject to externally imposed capital requirements.
Credit risk
The Group is mainly exposed to credit risk from credit sales. It is Group policy, implemented locally, to assess the credit risk of
new customers before entering contracts. Such credit ratings, taking into account local business practices, are then factored into
any contracts. Credit risk also extends to the banks utilised by the Group. The majority of cash deposits were held by the RBS
NatWest bank £3.9 million (2021: £4.1 million) and the Santander bank £10.8 million (2021: £10.2 million) at the year end and
these banks’ credit ratings (long-term) with Standard & Poor were A & A respectively.
Interest risk
The Group is exposed to interest risk but purely on bank deposits. It is Group policy to maximise the return on interest earned
whilst taking adequate steps to monitor the viability of the bank and safeguarding the assets of the Group.
Foreign exchange risk
The Group is exposed to foreign exchange risk both on a transactional and translational basis. The Group looks to mitigate
transactional foreign exchange risk by trying to balance its trade in foreign currencies and only hold sufficient currencies to meet
its future needs.
The sensitivities regarding the foreign exchange rate translation however are set out below:
Metric
Group Revenue
Group Profit
Group Net Assets
Change in GB Pounds
Translational Impact
Weaken/strengthen by 10%
Weaken/strengthen by 10%
Weaken/strengthen by 10%
Increase/decrease by 5.5%
Increase/decrease by 6.6%
Increase/decrease by 4.2%
The Group did not use forward contract derivatives to manage credit risk during the year.
Liquidity risk
At the end of the reporting period the ageing analysis of financial liabilities, with normal terms for trade payables being 30 days
net monthly, was as follows:
As at 30 September 2022
As at 30 September 2021
Total
£(000)
6,853
6,452
Within one
year
£(000)
Within one
to two years
£(000)
Over two
years
£(000)
6,465
6,112
–
–
388
340
48 Dewhurst Group plc Annual report & accounts 2022
Currency and interest rate exposure of financial assets and liabilities
The cash and cash equivalent amount of £21,764k (2021: £20,463k) is made up of cash of £11,264k (2021: £11,963k) and
short-term deposits of £10,500k (2021: £8,500k). The cash was invested at overnight rates based on the relevant national LIBOR.
Of the cash, £14,475k (2021: £14,144k) is denominated in GB Pounds with the balance of £7,289k (2021: £6,319k) held in
foreign currencies. Other financial assets and liabilities do not attract interest.
GB Pounds
AUS Dollars
US Dollars
CAN Dollars
Other
Floating
rate
assets
£(000)
5,644
4,409
1,034
502
374
Fixed
rate
assets
£(000)
8,500
–
–
–
–
Interest
free
assets
£(000)
2,933
3,054
1,663
1,736
233
Interest
free
liabilities
£(000)
1,088
484
290
84
286
Floating
rate
assets
£(000)
2,081
–
–
–
–
Fixed
rate
assets
£(000)
8,500
–
–
–
–
At 30 September 2021
11,963
8,500
9,619
2,232
2,081
8,500
GB Pounds
AUS Dollars
US Dollars
CAN Dollars
Other
3,975
4,445
1,360
1,193
291
10,500
–
–
–
–
4,400
2,987
1,582
2,624
246
1,033
397
322
132
323
526
126
–
–
–
10,500
–
–
–
–
At 30 September 2022
11,264
10,500
11,839
2,207
652
10,500
Interest
free
assets
£(000)
Interest
free
liabilities
£(000)
3
–
–
–
–
3
25
–
–
–
–
25
5
–
–
–
–
5
95
–
–
–
–
95
The only operations that hold material monetary assets and liabilities in currencies other than their functional currency are Traffic
Management Products Ltd (TMP), Dupar Controls Inc and Dewhurst (Hungary) Kft. TMP holds trade payables denominated in
US Dollars with a balance of £39k (2021: nil), Dupar holds trade receivables denominated in US Dollars with a balance of £457k
(2021: £210k), Dewhurst (Hungary) Kft holds trade receivables denominated in US Dollars with a balance of £626k (2021:
£1,185k) and trade payables denominated in Euros with a balance of £81k (2021: £109k).
Fair value of financial instruments
Fair value is defined as the amount at which a financial instrument could be exchanged in an arm’s length transaction between
informed and willing parties, excluding accrued interest, and is calculated by reference to market rates discounted to current
value. Accordingly, the Directors believe that there is no material difference between the carrying amount and the fair value of its
financial instruments.
Borrowings - bank lines of credit
The Group through Dupar Controls Inc continues with one line of credit following its built of its new premises in Canada. There
is a £1.7 million (C$2.5 million) operating line of credit bearing interest at Canadian prime plus 0.5% and at the year end the
amount borrowed was nil (2021: nil). This credit facility is secured by a general security agreement. Dupar Controls also signed a
£0.1 million (C$0.2 million) letter of credit with the City of Cambridge, Ontario, on which the City can draw from in the case of
any unpaid development costs. This loan bears interest at Canadian prime plus 2.0%, is secured by Dupar’s commercial property
and at the year end the balance on this loan was nil (2021: nil).
Dewhurst Group plc Annual report & accounts 2022 49
COMPANY FINANCIAL STATEMENTS
COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 30 September 2022
At 30 September 2020
Actuarial gains/(losses) on defined benefit pension scheme
Deferred tax effect
Dividends paid
Profit for the year
At 30 September 2021
Actuarial gains/(losses) on defined benefit
pension scheme
Deferred tax effect
Dividends paid
Profit for the year
Share
capital
£(000)
808
–
–
–
–
808
–
–
–
–
Share
premium
account
£(000)
Capital
redemption
reserve
£(000)
Retained
earnings
Total
equity
£(000)
£(000)
157
–
–
–
–
157
–
–
–
–
329
–
–
–
–
329
–
–
–
–
17,790
5,344
(1,336)
(1,091)
4,954
19,084
5,344
(1,336)
(1,091)
4,954
25,661
26,955
1,887
(472)
(1,152)
2,407
1,887
(472)
(1,152)
2,407
At 30 September 2022
808
157
329
28,331
29,625
The notes on pages 30 – 49 form part of these financial statements
50 Dewhurst Group plc Annual report & accounts 2022
COMPANY STATEMENT OF FINANCIAL POSITION
At 30 September 2022
Non-current assets
Property, plant and equipment
Deferred tax asset
Investments in subsidiaries
Current assets
Trade and other receivables
Cash and cash equivalents
Total assets
Current liabilities
Trade and other payables
Non-current liabilities
Retirement benefit obligation
Total liabilities
Net assets
Equity
Share capital
Share premium account
Capital redemption reserve
Retained earnings
Total equity
Notes
2022
£(000)
2021
£(000)
12
19
13
15
16
17
21
20
5,069
252
15,352
5,046
1,184
15,352
20,673
21,582
132
11,152
57
10,581
11,284
10,638
31,957
32,220
534
534
1,798
2,332
528
528
4,737
5,265
29,625
26,955
808
157
329
28,331
808
157
329
25,661
29,625
26,955
Retained earnings includes £2,407k (2021: £4,954k) of profit after tax for the financial year, which has been dealt with in the
financial statements of the holding company.
The financial statements were approved by the Board of Directors and authorised for issue on 8 December 2022 and were
signed on its behalf by:
Richard Dewhurst Chairman
Jared Sinclair Finance Director
Company Registration Number: 160314
The notes on pages 30 – 49 form part of these financial statements
Dewhurst Group plc Annual report & accounts 2022 51
COMPANY FINANCIAL STATEMENTS
COMPANY CASH FLOW STATEMENT
For the year ended 30 September 2022
Cash flows from operating activities
Operating profit/(loss)
Depreciation and amortisation
Contributions to pension scheme, net of administration fee & GMP equalisation
(Profit)/loss on disposal of property, plant and equipment
(Increase)/decrease in trade and other receivables
Increase/(decrease) in trade and other payables
Cash generated from/(used in) operations
Income tax paid
Net cash from/(used in) operating activities
Cash flows from investing activities
Acquisition of subsidiary undertaking
Purchase of property, plant and equipment
Interest received
Dividends received
Net cash generated from/(used in) investing activities
Cash flows from financing activities
Dividends paid
Purchase of own shares
Net cash used in financing activities
Notes
2022
£(000)
2021
£(000)
(1,368)
94
(1,137)
–
(2,411)
(75)
6
(2,480)
–
(2,480)
–
(117)
62
4,258
4,203
167
131
(1,357)
2
(1,057)
8
60
(989)
–
(989)
(649)
–
26
4,552
3,929
9
(1,152)
–
(1,091)
–
(1,152)
(1,091)
Net increase/(decrease) in cash and cash equivalents
571
1,849
Cash and cash equivalents at beginning of year
16
16
10,581
8,732
11,152
10,581
The notes on pages 30 – 49 form part of these financial statements
52 Dewhurst Group plc Annual report & accounts 2022
REPORT OF THE INDEPENDENT AUDITOR
Independent Auditor’s report
to the members of Dewhurst Group plc
for the year ended 30 September
2022.
Opinion
We have audited the financial
statements of Dewhurst Group Plc (the
‘Company’) and its subsidiaries (the
‘Group’) for the period ended 30
September 2022 which comprise the
consolidated statement of income and
other comprehensive income, the
consolidated and parent Company
statements of financial position, the
consolidated and parent Company
statements of cash flows, the
consolidated and parent Company
statements of changes in equity and
notes to the financial statements,
including a summary of significant
accounting policies. The financial
reporting framework that has been
applied in the preparation of the Group
and parent Company financial
statements is applicable law and
International Financial Reporting
Standards (IFRSs) as adopted by the
United Kingdom, as applied in
accordance with the provisions of the
Companies Act 2006.
In our opinion:
• the financial statements give a true
and fair view of the state of the
Group’s and of the parent Company’s
affairs as at 30 September 2022 and
of the Group’s profit for the year
then ended;
• the Group financial statements have
been properly prepared in
accordance with IFRSs as adopted by
the United Kingdom;
• the parent Company financial
statements have been properly
prepared in accordance with IFRS’s as
adopted by the United Kingdom as
applied in accordance with the
provisions of the Companies Act
2006; and
• the financial statements have been
prepared in accordance with the
requirements of the Companies Act
2006.
Basis for opinion
We conducted our audit in accordance
with International Standards on
Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities
under those standards are further
described in the Auditor’s
responsibilities for the audit of the
financial statements section of our
report. We are independent of the
Company in accordance with the
ethical requirements that are relevant
to our audit of the financial statements
in the UK, including the FRC’s Ethical
Standard as applied to listed entities,
and we have fulfilled our other ethical
responsibilities in accordance with
these requirements. We believe that
the audit evidence we have obtained is
sufficient and appropriate to provide a
basis for our opinion.
Conclusions relating to going
concern
In auditing the financial statements,
we have concluded that the director’s
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 entity’s ability to continue to
adopt the going concern basis of
accounting included:
• Reviewing bank statements to
monitor the cash position of the
group post year end
• Obtaining an understanding of
significant expected cash outflows in
the forthcoming 12-month period
from the date of signing these
financial statements including any
cash requirements the group may
have to provide to its investee
companies
• Assessing significant post year events
that have a material effect on the
financial statements
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’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.
Our audit approach
Overview
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 (whether or not due to
fraud) we identified, including those
which had the greatest effect on: the
overall audit strategy, the allocation of
resources in the audit; and directing
the efforts of the engagement team.
These matters were addressed in the
context of our audit of the financial
statements as a whole, and in forming
our opinion thereon, and we do not
provide a separate opinion on these
matters. This is not a complete list of
all risks identified by our audit.
• Revenue recognition
• Inventory provisioning
• Carrying value of investments/
intangibles and recoverability of
intercompany loans
• Carrying value of the retirement
benefit obligation
These are explained in more detail
below.
Audit scope
• We conducted audits of the
complete financial information of
Dewhurst Group Plc, Dewhurst
Limited, Traffic Management
Products Limited and A&A Electrical
Distributors Limited.
• We performed specified procedures
over certain account balances and
transaction classes at other Group
companies.
• Taken together, the Group
companies over which we performed
our audit procedures accounted for
100% of the absolute profit before
tax (i.e. the sum of the numerical
values without regard to whether
they were profits or losses for the
relevant reporting units) and 100%
of revenue.
Dewhurst Group plc Annual report & accounts 2022 53
REPORT OF THE INDEPENDENT AUDITOR
KEY AUDIT MATTERS
Key audit matter
How our audit addressed the key audit matter
Revenue recognition
The Group has 3 main revenue sources: lift components,
transport and keypad sales. The Group had a total turnover
of £57,565,000 for the year to 30 September 2022
(2021: £56,249,000) .
We checked compliance with IFRS 15, Revenue from
Contracts with Customers.
Inventory provisioning
The Group held £7,931,000 (2021: 6,597,000) of inventory
as at 30 September 2022.
There are key assumptions that drive the inventory provision
including the ability to sell older inventory and the realisable
value that will be achieved on sale. A provision for items
looking to be sold off at below cost and a provision for aged
items which there is a concern may ultimately be sold at
below cost.
The Group provides against 30% of the stock value where an
item has no significant movement in the year; and, provides
100% against stock which has not moved during the period.
Investments/Intangibles carrying value
The Company has investments of £15,352,000 (2021:
£15,352,000). And the Group had Goodwill and Intangible
assets of £10,124,000 (2021: £9,650,000).
The Company has amounts due from Group companies of
£8,000 (2021: £2,000).
Management have performed impairment reviews and have
exercised judgement as to the recovery of these investments
and amounts due.
54 Dewhurst Group plc Annual report & accounts 2022
Each component of the Group has a specific specialisation and focuses its
sales on its target market. A significant proportion of the Group’s sales
comes from the lift market. The majority of the revenue is for goods
transferred at a point in time. The Group has no material sources of
revenue relating to the sale of services.
We performed substantive tests to validate the revenue transactions. In
addition, we performed cut-off tests to check that items were recorded in
the appropriate period. We tested the inventory movement, ownership at
the period end, deferred revenue and work in progress.
We also checked and considered whether the Group had any material
contract assets and liabilities.
We reviewed post year end credit notes to check if there was any material
post year end adjustment that related to the period. In addition, we
checked the provision for expected credit losses and warranty provisions.
We checked the methodology used to calculate the inventory provision
and determined it was consistent with that applied in the prior year.
We tested the reasonableness of the Group inventory provision.
We attended the year end stocktakes, either in person or virtually, and
tested sheet to floor and vice versa to agree stock counts.
We compared a sample of inventory items at the reporting date to the
purchase cost and compared this with sales made around the reporting
period or after the year end. For samples which were components, we
traced the item to the bill of materials for the finished good and
compared the total sales price to the total purchase cost.
We reconciled the inventory values used in the provision to the general
ledger. We reviewed the calculations and determined that the policy was
correctly applied.
We reviewed the carrying value of the investments and intangible assets
and the loans to fellow subsidiaries. The review considered the current
position of the subsidiaries, the future outlook and forecasts prepared by
management.
We reviewed the subsidiary accounts and forecasts and have assessed the
financial position of each subsidiary.
We have also discussed the budgets and forecasts as part of the going
concern review and to consider whether we believed any investment was
impaired. We considered the loans held by Group entities and their ability
to service those loans. We assessed the impairment reviews performed by
management.
The Group is expected to remain cash generative and profitable based on
current trading trends. We have assessed and understood the
methodology and assumptions used by the Directors in their analysis and
determined it to be reasonable.
There were no permitted adjustments to the goodwill figure
but payments were made in the current and prior year due to an
earn-out which was accrued for in the Goodwill balance. We have
checked that any adjustment made passed through the income
statement.
We performed sensitivity analysis on the forecasts to check that the
values arrived at could be supported by a range of performance outcomes
that could be expected from the Company.
Key audit matter
Cyber attack
There is a risk that due to the cyber attack, accounting
information was altered, added to or deleted.
How our audit addressed the key audit matter
Enquiries were made by group and component auditors to consider the
risks relating to the integrity of the underlying data. Additional sampling of
entries, around the time of the breach and circularisation’s of debtors and
creditors were performed. We have nothing to report in respect of this
additional work.
Carrying value of the retirement benefit obligation and disclosures of retirement benefit obligations
There is a risk that the retirement benefit obligation
amounting to £1,798,000 (2021: £4,737,000) and before
deferred tax adjustment, has been incorrectly stated.
Management are required to ensure that all retirement
benefit obligations are appropriately disclosed.
Audit procedures were designed to ensure that reliance could be placed on
the expert actuary. Additional procedures were designed to ensure that the
calculations used were reasonable and that they were properly extracted
from the report prepared by the actuary and presented in the consolidated
financial statements.
We confirm that we reviewed the accounting disclosures pertaining to
retirement benefit obligations.
Our application of materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for
materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature,
timing and extent of our audit procedures on the individual financial statement line items and disclosures and in evaluating
the effect of misstatements, both individually and in aggregate on the financial statements as a whole.
Based on our professional judgment, we determined materiality for the financial statements as a whole as follows:
Group financial statements
Company financial statements
Overall materiality
£576,000 (30 September 2021: £562,000).
£300,000 (30 September 2021: £270,000).
How we determined it
A benchmark of 1% of Turnover was used to determine the
materiality for the Group (2021: 1% of Turnover).
Rationale for benchmark applied
We believe that turnover is a primary measure used by
shareholders in assessing the performance of the Group and
is an appropriate and accepted auditing benchmark.
A benchmark of 1% of net assets.
We consider an asset based measure best reflects the nature of the
Company which acts as a parent holding company for the Group’s
investments.
For each component in the scope of
our Group audit, we allocated a
materiality that is less than our overall
Group materiality. The range of
materiality allocated across components
was between £10,000 and £300,000.
We agreed with the Audit and Risk
Committee that we would report to
them misstatements identified during
our audit above £28,800 being 5% of
Group financial materiality as a whole,
as well as misstatements below those
amounts that, in our view, warranted
reporting for qualitative reasons.
An overview of the scope of
our audit
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 judgments, for example in
respect of significant accounting
estimates that involved making
assumptions and considering future
events that are inherently uncertain. As
in all of our audits we also addressed
the risk of management override of
internal controls, including evaluating
whether there was evidence of bias by
the Directors that represented a risk of
material misstatement due to fraud.
How we tailored the audit scope
We tailored the scope of our audit to
ensure that we performed enough
work to be able to give an opinion on
the financial statements as a whole,
taking into account the structure of the
Group and the Company, the
accounting processes and controls, and
the industry in which they operate.
The Group financial statements are a
consolidation of 14 reporting units,
comprising the Group’s operating
businesses of which 12 components
are trading subsidiaries. Each subsidiary
has its own accounting records and
controls and each reports to the head
office finance team in the UK.
Of the 12 trading subsidiaries, we
identified six which were considered to
be significant components for the
purposes of the Group financial
statements, and which, in our view,
Dewhurst Group plc Annual report & accounts 2022 55
REPORT OF THE INDEPENDENT AUDITOR
required a full audit of their complete
financial information in order to ensure
that sufficient audit evidence was
obtained. The Group audit team
performed the statutory audit of the
three trading UK subsidiaries, with
full-scope Group instructions issued to
the other three subsidiaries.
In addition to the significant
components, certain agreed upon
procedures were performed on six
subsidiaries where non-statutory audits
in local jurisdictions were also not
required. These works were planned and
conducted such that the audit work was
complete prior to completion of the
Group financial statements. For these
non-significant components, component
auditors were operating under our
instruction on a limited scope basis.
For all subsidiaries which are subject to
full-scope audits and had component
Auditors, the Group audit team was in
contact, at each stage of the audit, in
line with detailed instructions issued
and through planning calls and regular
written communication with the
component Auditors. Specifically, for all
component teams, the Group team
discussed in detail the planned audit
approach at the component level and
following the Group audit team review,
discussed the detailed reported
findings of the audit with each
component team.
The remaining trading subsidiaries
were not subject to full-scope audits.
Specific audit procedures on certain
balances and transactions were
performed, based upon component
materiality. This focused on revenue
recognition, inventory valuation, debtor
recoverability and existence and
completeness of related parties.
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.
In connection with our audit of the
financial statements, our responsibility
is to read the other information and, in
doing so, consider whether the other
information is materially inconsistent
with the financial statements or our
knowledge obtained in the audit or
otherwise appears to be materially
misstated. If we identify such material
inconsistencies or apparent material
misstatements, we are required to
determine whether there is a material
misstatement in the financial
statements or a material misstatement
of the other information. If, based on
the work we have performed, we
conclude that there is a material
misstatement of this other information,
we are required to report that fact. We
have nothing to report in this regard.
Opinions on other matters
prescribed by the Companies Act
2006
In our opinion, based on the work
undertaken in the course of the audit:
• the information given in the strategic
report and the Directors’ Report for
the financial year for which the
financial statements are prepared is
consistent with the financial
statements; and
• the strategic report and the
Directors’ Report have been prepared
in accordance with applicable legal
requirements.
Matters on which we are required
to report by exception
In the light of the knowledge and
understanding of the Group and
parent Company and its environment
obtained in the course of the audit, we
have not identified material
misstatements in the strategic report or
the Directors’ Report.
We have nothing to report in respect of
the following matters in relation to
which the Companies Act 2006 requires
us to report to you if, in our opinion:
• adequate accounting records have
not been kept by the parent
Company, or returns adequate for
our audit have not been received
from branches not visited by us; or
• the parent Company financial
statements and the part of the
Directors’ remuneration
report to be audited are not in
agreement with the accounting
records and returns; or
56 Dewhurst Group plc Annual report & accounts 2022
• certain disclosures of Directors’
remuneration specified by law are
not made; or
• we have not received all the
information and explanations we
require for our audit.
Responsibilities of Directors
As explained more fully in the
Directors’ responsibilities statement set
out on page 19, the Directors are
responsible for the preparation of the
financial statements and for being
satisfied that they give a true and fair
view, and for such internal control as
the Directors determine is necessary to
enable the preparation of financial
statements that are free from material
misstatement, whether due to fraud
or error.
In preparing the financial statements,
the Directors are responsible for
assessing the Group’s and parent
Company’s ability to continue as a
going concern, disclosing, as
applicable, matters related to going
concern and using the going concern
basis of accounting unless the Directors
either intend to liquidate the Group or
the parent Company or to cease
operations, or have no realistic
alternative but to do so.
Auditor’s responsibilities for the
audit of the financial statements
Our objectives are to obtain reasonable
assurance about whether the financial
statements as a whole are free from
material misstatement, whether due to
fraud or error, and to issue an Auditor’s
report that includes our opinion.
Reasonable assurance is a high level of
assurance, but is not a guarantee that
an audit conducted in accordance with
ISAs (UK) will always detect a material
misstatement when it exists.
Misstatements can arise from fraud or
error and are considered material if,
individually or in the aggregate, they
could reasonably be expected to
influence the economic decisions of
users taken on the basis of these
financial statements.
A further description of our
responsibilities for the audit of the
financial statements is located on the
Financial Reporting Council’s website at:
www.frc.org.uk/auditorsresponsibilities.
This description forms part of our
Auditor’s Report.
The extent to which the audit was
considered capable of detecting
irregularities including fraud
Our approach to identifying and
assessing the risks of material
misstatement in respect of
irregularities, including fraud and
non-compliance with laws and
regulations, was as follows:
• The senior statutory auditor ensured
the engagement team collectively
had the appropriate competence,
capabilities and skills to identify or
recognise non-compliance with
applicable laws and regulations.
• We identified the laws and
regulations applicable to the group
through discussions with directors
and other management:
– The Companies Act 2006 and IFRS
in respect of the preparation and
presentation of the financial
statements and;
– AIM regulations and Market Abuse
Regulations
• We focused on specific laws and
regulations which we considered
may have a direct material effect on
the financial statements or the
operations of the company, including
taxation legislation, data protection,
anti-bribery, employment,
environmental, health and safety
legislation and anti-money
laundering regulations.
• We assessed the extent of
compliance with the laws and
regulations identified above through
making enquiries of management
and inspecting legal correspondence.
• Identified laws and regulations were
communicated within the audit team
regularly and the team remained
alert to instances of non-compliance
throughout the audit; and
We assessed the susceptibility of the
company’s financial statements to
material misstatement, including
obtaining an understanding of how
fraud might occur, by:
• making enquiries of management as
to where they considered there was
susceptibility to fraud, their
knowledge of actual, suspected and
alleged fraud; and
• considering the internal controls in
place to mitigate risks of fraud and
non-compliance with laws and
regulations.
To address the risk of fraud through
management bias and override of
controls, we:
• Performed analytical procedures to
identify any unusual or unexpected
relationships;
• Tested journal entries to identify
unusual transactions;
• Assessed whether judgements and
assumptions made in determining
the accounting estimates set out in
note 1 of the financial statements
were indicative of potential bias;
• Investigated the rationale behind
significant or unusual transactions;
and
In response to the risk of irregularities
and non-compliance with laws and
regulations, we designed procedures
which included, but were not limited to:
• agreeing financial statement
disclosures to underlying supporting
documentation;
• reading the minutes of meetings of
those charged with governance;
• enquiring of management as to
actual and potential litigation and
claims; and
• reviewing correspondence with
HMRC and the company’s legal
advisors.
There are inherent limitations in our
audit procedures described above.
The more removed that laws and
regulations are from financial
transactions, the less likely it is that we
would become aware of
noncompliance. Auditing standards
also limit the audit procedures required
to identify non-compliance with laws
and regulations to enquiry of the
directors and other management and
the inspection of regulatory and legal
correspondence, if any.
Material misstatements that arise due
to fraud can be harder to detect than
those that arise from error as they may
involve deliberate concealment or
collusion.
A further description of our
responsibilities for the audit of the
financial statement is located on the
Financial Reporting Council’s website at:
www.frc.ork.uk/auditorsresponsibilities
This description forms part of our
auditor’s report.
Other matters which we are
required to address
We were appointed by the board of
directors on 9 July 2018 to audit the
financial statements. Our total
uninterrupted period of engagement is
5 years, covering the period ending
30 September 2022.
The audit has been designed to detect
all material irregularities, including
fraud. We believe our tests are
sufficient in this regard. The
engagement team has remained
alert to any indication of fraud or
non-compliance with laws and
regulations throughout the audit.
The non-audit services prohibited by
the FRC’s Ethical Standard were not
provided to the Group or the parent
Company and we remain independent
of the Group and the parent Company
in conducting our audit.
Our audit opinion is consistent with the
additional Report to the Audit
committee.
Use of this 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.
Sachin Ramaiya
(Senior Statutory Auditor)
For and on behalf of
Jeffreys Henry LLP
(Statutory Auditors)
Finsgate
5–7 Cranwood Street
London EC1V 9EE
8 December 2022
Dewhurst Group plc Annual report & accounts 2022 57
NOTICE OF MEETING
Notice is hereby given that the one
hundredth and third Annual General
Meeting of Dewhurst Group plc
will be held at its registered office,
Unit 9, Hampton Business Park,
Hampton Road West, Feltham,
TW13 6DB on 14 February 2023 at
10.00 am. The meeting will be held in
order to consider and, if thought fit,
pass resolutions 1 to 6 as ordinary
resolutions.
Ordinary resolutions
1 To receive and adopt the statement
of accounts for the year ended
30 September 2022 and the Reports of
the Directors and Auditor thereon.
2 To declare and approve a final
dividend on the Ordinary and ‘A’
non-voting ordinary shares to
Shareholders on the register of
members on 20 January 2023.
3 To re-elect as a Director
Mr J C Sinclair, who retires by rotation
under the Articles of Association.
4 To re-elect as a Director Mr J Bailey,
who retires by rotation under the
Articles of Association.
5 To re-appoint Jeffreys Henry LLP as
Auditor at a fee to be agreed by the
Directors.
6 As special business to consider and,
if thought fit, pass the following
ordinary resolution: that the Company
be and is hereby generally and
unconditionally authorised to make
market purchases (within the meaning
of section 693(4) of the Companies Act
2006) of up to an aggregate of
496,380 Ordinary shares and 715,830
‘A’ non-voting ordinary shares of 10p
each (representing 15% of the issued
share capital) in the Company at a
price per share (exclusive of expenses)
of not less than 10p and not more
than 105% of the average of the
middle market quotations for such
Ordinary and ‘A’ non-voting ordinary
shares, as derived from the Stock
Exchange Daily Official List, for the ten
dealing days immediately preceding
the day of the purchase; such authority
to expire at the conclusion of the
Annual General Meeting to be held in
2024 save that the Company may
purchase shares at any later date
where such purchase is pursuant to any
contract made by the Company before
the expiry of this authority.
7 To transact any other ordinary
business of the Company.
By order of the Board
Jared Sinclair
Secretary
31 December 2022
Notes
1 All Shareholders who wish to attend and vote at
the meeting must be entered on the Company’s
register of members no later than 10.00 am on
12 February 2023 (being 48 hours prior to the time
fixed for the meeting) or, in the case of an
adjournment, as at 48 hours prior to the time of
the adjourned meeting. Changes to entries on the
register after that time will be disregarded in
determining the rights of any person to attend or
vote at the meeting. ‘A’ non-voting ordinary shares
do not carry the right to attend or vote at meetings
of the Company.
2 Shareholders entitled to attend and vote at the
meeting may appoint a proxy or proxies to attend,
vote and speak on their behalf. A proxy need not be
a member of the Company. Investors who hold
their shares through a nominee may wish to attend
the meeting as a proxy, or to arrange for someone
else to do so for them, in which case they should
discuss this with their nominee or stockbroker.
Shareholders are invited to complete and return the
enclosed Proxy Form. Completion of the Proxy Form
will not prevent a Shareholder from attending and
voting at the meeting if subsequently he/she finds
that he/she is able to do so. To be valid, completed
Proxy Forms must be received by the Company
Secretary at the registered office of the Company,
Dewhurst Group plc, Unit 9, Hampton Business
Park, Hampton Road West, Feltham, TW13 6DB or
the scanned Proxy Form emailed to cosec@
dewhurst-group.com by no later than 48 hours
before the time appointed for the holding of the
meeting, or, in the case of an adjournment, as at 48
hours prior to the time of the adjourned meeting.
3 Representatives of Shareholders which are
corporations attending the meeting should produce
evidence of their appointment by an instrument
executed in accordance with Section 44 of the
Companies Act 2006 or signed on behalf of the
corporation by a duly authorised officer or agent
and in accordance with article 71 of the Company’s
Articles of Association.
4 The Company, pursuant to Regulation 41 of the
Uncertificated Securities Regulations 2001, specifies
that only those holders of Ordinary Shares
registered in the register of members of the
Company at 10.00 am on 12 February 2023 (being
48 hours prior to the time fixed for the meeting)
shall be entitled to attend and vote at the Annual
General Meeting in respect of such number of
shares registered in their name at that time.
Changes to entries in the register of members after
that time shall be disregarded in determining the
rights of any person to attend or vote at the
meeting.
5 A copy of the Company’s current Articles of
Association will be available for inspection during
usual business hours on any weekday (Saturdays,
Sundays and Public Holidays excluded) at the
registered office of the Company until the date of
the Annual General Meeting and at the place of the
meeting for 15 minutes prior to and until the
termination of the meeting.
58 Dewhurst Group plc Annual report & accounts 2022
Dual Engraving Pty Ltd
104 Howe Street,
Osborne Park, WA 6017
Australia
Tel: 00 618 9443 3677
garry@dualengraving.com.au
www.dualengraving.com.au
Dewhurst (Hong Kong) Ltd
Unit 19, 7/F, Block A
Hoi Luen Industrial Centre
55 Hoi Yuen Road
Hong Kong
Tel: 00 852 3523 1563
flai@dewhurst-group.com
www.dewhurst-group.com
GROUP COMPANIES
HEAD OFFICE
Dewhurst Group plc
Unit 9, Hampton Business Park
Hampton Road West
Feltham TW13 6DB
Tel: 020 8744 8200
cosec@dewhurst-group.com
www.dewhurst-group.com
UK SUBSIDIARIES
Dewhurst Ltd
Unit 9, Hampton Business Park
Hampton Road West
Feltham TW13 6DB
Tel: 020 8744 8200
info@dewhurst.co.uk
www.dewhurst.co.uk
A&A Electrical Distributors Ltd
234-262 Maybank Road
South Woodford
London E18 1ET
Tel: 020 8559 7000
sales@aa-electrical.com
www.aa-electrical.com
Traffic Management Products Ltd
Unit 6, Trident Drive
Wednesbury WS10 7XB
Tel: 020 8744 8201
info@tmp.solutions
www.tmp.solutions
OVERSEAS SUBSIDIARIES
Dewhurst (Hungary) Kft
H-2038, Soskut
Hrsz. 3518/8
Hungary
Tel: 00 362 356 0550
Dupar Controls Inc.
150 Goddard Crescent
Cambridge, Ontario
Canada N3E 0A9
Tel: 001 519 624 2510
sales@dupar.com
www.dupar.com
Elevator Research
Manufacturing Corp.
1417 Elwood Street
Los Angeles
CA 90021 USA
Tel: 001 213 746 1914
sales@elevatorresearch.com
www.elevatorresearch.com
Australian Lift Components Pty Ltd
5 Saggartfield Road
Minto
NSW 2566
Australia
Tel: 00 612 9603 0200
info@ausliftcomp.com.au
www.ausliftcomp.com.au
P&R Liftcars Pty Ltd
7 Kiama Street, Miranda
NSW 2228, Australia
Tel: 00 612 9522 4777
info@prlift.com.au
www.prlift.com.au
Lift Material Australia Pty Ltd
Unit 2, 73 Beauchamp Road Matraville
NSW 2036
Australia
Tel: 00 612 93 10 4288
info@liftmaterial.com
www.liftmaterial.com
Dewhurst Group plc Annual report & accounts 2022 59
ADVISERS AND COMPANY INFORMATION
SECRETARY AND
REGISTERED OFFICE
Jared Sinclair
Dewhurst Group plc
Unit 9, Hampton Business Park
Hampton Road West
Feltham TW13 6DB
Registered No. 160314
AUDITOR
Jeffreys Henry LLP
Chartered Accountants and
Statutory Auditor
5-7 Cranwood Street
London EC1V 9EE
BANKERS
National Westminster Bank plc
275-277 High Street
Hounslow
Middlesex TW3 1EG
REGISTRARS
Link Group
10th Floor
Central Square
29 Wellington Street
Leeds LS1 4DL
NOMINATED ADVISER
AND BROKER
Singer Capital Markets
1 Bartholomew Lane
London EC2N 2AX
SOLICITORS
Taylor Wessing LLP
5 New Street Square
London EC4A 3TW
60 Dewhurst Group plc Annual report & accounts 2022
Design: Gill Davies Associates
www.dewhurst-group.com
BC Dewhurst plc Annual report & accounts 2022
RUNNING-HEAD