2014 Annual Report
and Accounts
Welcome to our
Annual Report 2014
Epwin is a vertically integrated manufacturer of low
maintenance building products, operating in the RMI,
new build and social housing sectors.
Contents
Overview
Financial Highlights
Operational Highlights
Chairman’s Statement
Strategic Report
Business Overview
Strategic and Operational Review
Financial Review
Key Performance Indicators
Principal Risks and Uncertainties
Our Governance
Corporate Governance
Directors and Advisors
Directors’ Report
Directors’ Remuneration Report
Statement of Directors’ Responsibilities
Financial Statements
Independent Auditor’s Report
Consolidated Income Statement
Consolidated Balance Sheet
Consolidated Statement of Changes in Equity
Consolidated Cash Flow Statement
Notes to the Accounts
Company Balance Sheet
Notes to the Company Accounts
Annual General Meeting
004
005
006
010
012
014
018
019
022
030
032
036
040
044
046
047
048
049
051
096
097
Notice of Annual General Meeting
104
Visit us online
www.epwin.co.uk
4
Highlights
The Group believes it is well positioned to benefit from the anticipated
rise in the Repair, Maintenance and Improvement (RMI) market as the UK
economic upturn gathers pace and household disposable incomes begin
to increase.
Revenue
£259.5m
1.6%
Pre-tax operating cash flow
£19.9m
Net cash at year end
£1.1m
Basic earnings per share
11.56p
Final dividend per share
2.83p
Adjusted EBITDA
£24.5m
14.5%
Underlying operating profit
£18.3m
37.6%
Operating profit
£19.3m
Profit before tax
£18.6m
119.3%
138.5%
Epwin Group Plc Annual Report and Accounts 2014 5
Financial highlights
Revenue from continuing operations increased by
1.6% to £259.5 million (2013: £255.3 million).
Basic earnings per share of 11.56 pence (2013: 4.09
pence).
Adjusted EBITDA (*) increased by 14.5% to £24.5
million (2013: £21.4 million) and adjusted EBITDA
margin to 9.4% from 8.4%.
Underlying operating profit (**) up 37.6% to £18.3
million (2013: £13.3 million). Operating profit was up
£10.5 million from £8.8 million to £19.3 million.
Proposed final dividend of 2.83 pence per ordinary
share following on from an interim dividend of 1.41
pence per ordinary share, making the total dividend
for the year 4.24 pence per share.
Profit before tax increased from £7.8 million in
2013 to £18.6 million in 2014 as a result of the
improvement in underlying profitability, the release
of provisions no longer required on the settlement
of a number of legacy property leases and elimination
of the pre-IPO shareholder management charges.
Positive net cash, £1.1 million, at 31 December 2014,
up from a net debt position of £18.7 million at 31
December 2013, after £10 million was received at
IPO, with cash generated from operations before tax
up 54.3% at £19.9 million (2013: £12.9 million).
Operating cash conversion (***) increased from
97.0% in 2013 to 108.7% in 2014.
(*) Adjusted EBITDA is before non-recurring costs, share-based payments,
discontinued operations and pre-IPO shareholder management charges.
Pre-IPO shareholder management charges relate to management services
provided by entities controlled by the pre-IPO majority shareholders. These
charges ceased from the date of admission to AIM.
(**) Underlying operating profit is before amortisation of acquired
intangible fixed assets, business re-organisation costs and share based
payments.
(***) Operating cash conversion is pre-tax operating cash flow as a
percentage of underlying operating profit.
Operational highlights
Strong trading performance from the Extrusion
Investment in property, plant and equipment and
Division, revenues increasing by 6.0% to £142.9
IT systems continues to maintain and improve the
million and underlying operating profit by 50.9%
Group’s overall manufacturing efficiency and capacity,
to £16.6 million reflecting the full impact of synergy
with future improvements targeted over the
savings following the 2012 merger.
coming years.
Rainwater products continue to grow organically with
Further site integrations have been completed in the
sales increasing by 20% from the prior year, potential
year and others will be completed during the first half
further increases in this area continue to represent
of 2015 which will deliver further synergy benefits and
opportunities for 2015 and onwards.
cost savings.
The Fabrication and Distribution Division has had a
Two non-core businesses have been disposed of in
more challenging year. Ongoing revenue decreased
the year allowing the Group to focus on its core
by 3.2% to £116.6 million due to delays to the start
competencies.
of new social housing contracts and the decision to
withdraw from low margin business. Operating profit
was £4.5 million, down from £6.1 million in 2013
due to operational and commercial inefficiencies
which continue to be addressed through investment,
recruitment, training and improved management.
The Group is well positioned to benefit from the
anticipated rise in the Repair, Maintenance and
Improvement (RMI) market as the UK economic upturn
gathers pace and household disposable incomes begin
to increase.
www.epwin.co.uk 6
Chairman’s Statement
In what has been a year of change the Group has delivered a strong
set of results, generating significantly higher profits and cash.
Introduction
Results
I am pleased to present our maiden results as a public
In the year under review, revenue from continuing
company for the financial year ended 31 December 2014.
operations increased by 1.6% to £259.5 million and
In what has been another year of significant change,
underlying operating profit before pre-IPO shareholder
Epwin has made good progress towards the Group’s
management charges improved by 25.8% to £19.5
strategic and financial goals. I believe we will look back on
million.
2014 as a year in which we laid the foundations for a very
successful and competitive business.
Strong cash conversion resulted in an operating cash flow
before taxation of £19.9 million (2013: £12.9 million). Net
funds at the year-end were £1.1 million (2013: net debt
Strategy & operational development
of £18.7 million).
As well as the IPO, the senior management team have
continued their strategy of restructuring and rationalisation
as they continue to realise the opportunities presented by
the merger with the Latium group of companies in 2012.
This strategy has seen a number of senior appointments
to strengthen the management team, in particular in
the Fabrication and Distribution business, as well as the
disposal of some non-core operations.
Dividends
In October 2014 we paid our first interim dividend of
1.41 pence per ordinary share. I am pleased to announce
that, in line with our stated dividend policy, the Board is
recommending a final dividend of 2.83 pence per ordinary
share to be paid on 8 June 2015 to shareholders on the
register on 15 May 2015. This gives a full year dividend of
The completion of the restructuring, together with the
4.24 pence per ordinary share, which represents a yield of
refinancing of bank facilities and proceeds from the IPO,
4.24% based on the market capitalisation of Epwin Group
put the Group in a very healthy funding position and
Plc on admission to AIM.
provides a platform from which to pursue the longer
term Board strategy. This includes continued operational
improvements and the intention to take advantage of
opportunities to increase shareholder value as they arise.
Epwin Group Plc Annual Report and Accounts 2014 7
People
2014 was another year of organisational change as management
continued its programme of restructuring and rationalisation.
The year just ended has also been about hiring and integrating
a number of senior appointments that significantly strengthen
the senior management team for the future.
On behalf of the Board and our shareholders I would like to
thank our employees for the levels of commitment shown to
the Group, and for the benefit of customers and shareholders,
during this year of change. A number of employees throughout
the Group have taken the opportunity that the IPO has
presented to own shares in the Group. It is hoped that more
will do so in the coming year as we launch an SAYE scheme.
Outlook
The Board believes that the Group is well placed
to continue to grow its operating profits and
to capitalise on anticipated future market
improvements over the coming year.
Andrew Eastgate
Chairman
15th April 2015
www.epwin.co.uk 8
Epwin Group Plc Annual Report and Accounts 2014 9
Strategic Report
Strategic Report
Business Overview
Strategic and Operational Review
Financial Review
Key Performance Indicators
Principal Risks and Uncertainties
010
012
014
018
019
www.epwin.co.uk 10
Business Overview
Business overview & principal activities
Epwin is a vertically integrated manufacturer of extrusions,
mouldings and fabricated low maintenance building
products, operating in the RMI, new build and social
housing sectors.
The Group is the result of a merger in January 2012
between the Epwin business and certain of the Latium
businesses. Founded in 1976, the Epwin business has
grown and developed both organically and by acquisition
over the last 38 years. From its origins as one of the first
PVC-U window fabrication businesses in the UK, the
Epwin business has changed significantly to become
a stable and substantial player, selling a broad range
of low maintenance building products.
Listed for a period from the late 1980s, the Epwin
business was taken private in 1999 as a predominantly
fenestration-orientated business. In the following year,
with the acquisition of Swish Building Products, the Epwin
business began to diversify its product offering and has
subsequently played a major role in consolidating the
sector. Epwin’s fabrication operations developed into a
window profile systems manufacturer before widening its
range of products to include cellular roofline and cladding
extrusions, rainwater and underground moulding and
extrusions, GRP and thermoplastic doorsets and glass
sealed units.
The industry consolidation process led ultimately to the
merger in January 2012, and the creation of the current
Group. This gave Epwin a larger market share in its core
markets and broadened its product portfolio as well as
offering the opportunity to make synergistic cost savings
and further leverage the vertically integrated approach
to the market.
The Group has made significant steps in delivering
post-merger synergies over the last three years, having
successfully delivered on an initial programme of factory
mergers, cost savings and logistics optimisation to
improve efficiencies and profitability.
Today the Group operates from a number of facilities
located across the UK. The Board and senior management
view and run the business as two segments, being the
Extrusion businesses that form the manufacturing base,
as well as being a B2B supplier, and the Fabrication and
Distribution businesses that provide alternative routes to
market as well as additional pull on the manufacturing
businesses.
The Group has developed and acquired a portfolio of
over 30 brands, which collectively represent the market
face of the Group and are operated to maximise the
sales opportunities presented by a diverse and
fragmented market.
Epwin Group Plc Annual Report and Accounts 2014 11
Extrusion Business
Fabrication and Distribution Business
Manufactures and markets the following products:
Fabricates and markets ranges of branded windows and
Leading brands of PVC-UE extruded ‘cellular’
roofline and cladding profile systems for the
doors from the Group’s own profile systems for sale to
the trade, social and new build sectors.
replacement and installation of soffits, barge
Manufactures around 350,000 frames per year,
boards, cladding and trims. The Division is the
c. 40,000 Glass Reinforced Plastic (GRP) and
market leader extruding c.30,000 tonnes per
Thermoplastic door sets and 1.3 million glass
annum.
sealed units.
Complete extruded PVC-U window profile
Additionally operates 26 building plastic trade
systems for fabricators of windows, doors, cavity
distribution centres and separately 16 Window
closers and curtain walling. c.35,000 tonnes of
Stores as direct trade outlets for the Group’s
profile manufactured per year, estimated to be
manufactured products.
one of the two largest manufacturers in the UK.
A growing complementary range of PVC-U
rainwater and drainage products, c.5,000 tonnes
per annum.
Operates from four extrusion and
moulding facilities in Telford, Tamworth,
Macclesfield and Scunthorpe.
www.epwin.co.uk
12
Strategic and Operational Review
Overview
The year ended 31 December 2014 was a year of change
for Epwin with the business being admitted to trading on
AIM in July. At the same time the year has been one of
consolidation as the Group further progressed its strategy
of rationalisation, disposing of non-core businesses
and withdrawing from unprofitable business as well as
realising further synergy benefits envisaged at the time
of the merger in 2012 but delayed by the Competition
Commission review of that year.
There is currently a project underway to re-locate a
warehouse from Telford to a newly constructed facility
adjacent to the Tamworth cellular extrusion facility. This
will be completed in Q2 2015 and is expected to generate
operational synergies. Together these projects are expected
to realise synergies of £0.5 million annualised.
Additionally, the Group will build upon these
developments by introducing further products in 2015/16,
including entirely new, market leading, window profile
systems to be sold under the Profile 22 brand.
Extrusion
Within the Extrusion business revenues increased by 6.0%
to £142.9 million, principally driven by sales of cellular
profile. Specification sales of cellular profile were strong
in the year, assisted by the buoyant performance of
housebuilders. Trade sales also performed well particularly
in the second half of the year. Encouragingly, sales of
rainwater products grew organically 20% year on year and
this remains an area of focus for the business, as too is the
growth of drainage products.
Window profile systems revenues were also up year on
year, by 4.5%. This has been driven by an increase in sales
volumes of the Spectus brand, which has seen growth
in both existing and new customer accounts. Sales of
window hardware increased by 4% over the prior year.
Operational performance within the extrusion business
was excellent, with record levels of service and operational
efficiencies being achieved. There has been investment in
capacity and demand at the extrusion sites during 2014
which has helped ensure that demand from the market
has been met effectively.
The window systems foiling plant was successfully
re-located to a better equipped site at the end of 2014,
which is expected to enhance product offer and customer
service.
Fabrication and Distribution
The Fabrication and Distribution business has had a
year of significant change. The changes made are now
substantially completed and have addressed the majority
of the legacy issues in the business, consequently there is
confidence in the greater robustness of the business going
forward. New management has been in post now for
around twelve months and is driving the change process,
focussing on upskilling across the business in order to
improve efficiencies in operational performance and
commercial execution. Revenues decreased by 3.2% to
£116.6 million in the year as certain lower margin business
was exited.
The Door business was consolidated during 2014, reducing
from two sites to one. After a period of re-organisation
the business is now moving forward and the launch of
the new trade door in February 2015 strengthens the
commercial offer significantly.
The Glass business has been through a process of
reviewing customer profitability and has consequently
reduced its revenue by around £2 million. A new Insulated
Glass Unit (IGU) line has been installed in the Northampton
glass plant and this will add an additional £0.5 million of
annualised benefit through improved operational efficiency
and increased output and quality. The Group also took the
opportunity to dispose of a non-core, loss making bespoke
glass business in August 2014.
Epwin Group Plc Annual Report and Accounts 2014 13
Health and safety
The Group is committed to ensuring a safe, clean
and healthy working environment for all 2,300 of its
employees, its customers and suppliers. The Group
actively promotes health and safety and the continuous
improvement in health and safety standards across all
operations.
Market outlook
There has been significant under investment by landlords
and property owners in the UK’s housing stock. The Office
for National Statistics figures indicate that there are 27.8
million homes across the country and only 60% of these
dependent on improving markets, or government policy,
but on operational improvement and selective capital
investment.
The Directors believe that the Group will benefit from
the UK economic upturn in the RMI market, as well as
the increased focus on energy efficient buildings. A four
point strategic plan to take advantage of these market
conditions and drive profit growth is in place, as follows:
Cross selling opportunities
The Directors believe there are a number of opportunities
for the Group’s products to be cross-sold through different
brands and alternative sales channels.
are maintained to a satisfactory level.
Brand extension
Recent industry figures indicate that around 4.3 million
window frames are replaced each year, representing a
replacement rate of less than 2% per annum. The Group
believes that a replacement rate significantly above this is
required to address the ageing population of fenestration
The Group operates a multiple branding strategy and
believes that the use of these brands can be extended.
The Directors are developing the use of these brands in
conjunction with the products portfolio to capitalise on
the opportunities in the new build, social housing and RMI
sectors which the Directors believe could increase revenues
products and due to the recent history of underinvestment
and enhance margins.
in UK housing stock, there is further significant pent up
demand within the RMI space.
Potential exists to increase Group market share in the new
build and social housing sectors by geographical extension
The Group additionally believes that the same
of current regional activities.
opportunities exist for its wider range of low maintenance
building products designed for the broad spectrum of
Market consolidation
demand from the UK RMI market.
The Board believes there is opportunity to consolidate
Forecast growth in real wages and growing consumer
confidence should help the Group grow its revenues in
further operations by identifying potential targets that add
routes to market, products and/or improve market share.
coming years. The forthcoming General Election in May
Operational leverage
2015 may cause some turbulence, however Government
The Board believes the Group has additional capacity in its
policy may assist the business as the Affordable Homes
manufacturing and warehousing network, and therefore
Programme has been extended to 2020. Additionally,
market growth and additional revenues from organic
the Government has said it will release public sector land
growth would enhance margins.
with capacity for 150,000 homes by 2020 and the Group
anticipates continued maintenance expenditure on social
housing stock as well as schools, hospitals and other public
buildings. Importantly, however, the Group’s strategy is not
www.epwin.co.uk 14
Financial Review
Financial performance
Total revenue for the year ended 31 December 2014 increased by 1.6% to £259.5 million compared to £255.3 million for
the year ended 31 December 2013. The growth in revenue was largely driven by strong demand for the Group’s extruded
products.
Underlying operating profit before pre-IPO shareholder management charges was £19.5 million (2013: £15.5 million),
representing growth of 25.8%, as a result of cost savings from synergy and rationalisation projects, and higher extruded
products volumes.
Operating profit was £19.3 million (2013: £8.8 million) as a result of the improvement in underlying business profitability
and the release of provisions no longer required due to the settlement of a number of legacy property leases and elimination
of the pre-IPO shareholder management charges.
Key financials
Year ended 31
December 2014
£m
Year ended 31
December 2013
£m
Revenue (excluding discontinued operations)
259.5
255.3
Adjusted EBITDA (*)
Depreciation
24.5
(5.0)
Underlying operating profit (**) before pre-IPO shareholder management charges
19.5
Pre-IPO Shareholder management charges
Underlying operating profit (**)
Amortisation of acquired intangible fixed assets
Business re-organisation costs
Share-based payments
Operating profit
Underlying operating margin (**) before pre-IPO shareholder management charges
Operating margin
(1.2)
18.3
(1.7)
3.5
(0.8)
19.3
7.5%
7.4%
21.4
(5.9)
15.5
(2.2)
13.3
(1.7)
(2.8)
-
8.8
6.1%
3.4%
(*) Adjusted EBITDA is before non-recurring costs, amortisation of acquired intangible fixed assets, share-based payments, discontinued operations and pre-IPO
shareholder management charges. Pre-IPO shareholder management charges relate to management services provided by entities controlled by the pre-IPO
majority shareholders. These charges ceased from the date of admission to AIM.
(**) Underlying operating profit and margin is before amortisation of acquired intangible fixed assets, business re-organisation costs and share-based payments.
Epwin Group Plc Annual Report and Accounts 2014
15
Year ended 31
December 2014
£m
Year ended 31
December 2013
£m
142.9
116.6
134.8
120.5
259.5
255.3
16.6
4.5
21.1
(1.6)
19.5
(1.2)
18.3
(1.7)
3.5
(0.8)
19.3
11.0
6.1
17.1
(1.6)
15.5
(2.2)
13.3
(1.7)
(2.8)
-
8.8
Reportable segments
Revenue (excluding discontinued operations)
Extrusion
Fabrication and distribution
Total
Underlying segmental operating profit
Extrusion
Fabrication and distribution
Underlying segmental operating profit before corporate and other costs
Corporate and other costs
Underlying operating profit (*) before pre-IPO shareholder management charges (**)
Pre-IPO shareholder management charges
Underlying operating profit (*)
Amortisation of acquired intangible fixed assets
Business re-organisation
Share-based payments
Operating profit
(*) Underlying operating profit is before amortisation of acquired intangible fixed assets, business re-organisation costs and share based payments.
(**) Pre-IPO shareholder management charges relate to management services provided by entities controlled by the pre-IPO majority shareholders. These
charges ceased from the date of admission to AIM.
www.epwin.co.uk
16
Financial Review continued
Extrusion
Revenue increased by 6.0% to £142.9 million (2013: £134.8 million) during the year and operating profit increased to
£16.6 million from £11.0 million.
Operating margins improved to 11.6% compared to 8.2% in the same period in 2013, due to volume increases and
site integration savings.
Fabrication and Distribution
Revenue decreased by 3.2% to £116.6 million (2013: £120.5 million). The revenue decreases are a combination of
delays resulting from contract awards and the withdrawal from low margin work.
Operating profit of £4.5 million, down from £6.1 million in 2013, due to lower sales volumes, disruption as a result
of the re-organisation and the cost of improvement in operational and commercial efficiency which is now being
addressed by new management. Consequently operating margins decreased to 3.9% compared to 5.1% in 2013.
Improvements in the performance of commercial operations are being addressed through recruitment, training and
improved management.
Non underlying items
To assist users of the financial statements to understand underlying trading performance, non-recurring, exceptional items
amortisation and share based payments have been excluded from operating profit in arriving at underlying operating profit.
Non-recurring and exceptional items include:
Amortisation of acquired intangible fixed assets
£1.7 million amortisation of brand and customer contract intangible fixed assets created on the merger in 2012. Customer
contract intangibles are fully amortised at 31 December 2014.
Business re-organisation
Site rationalisation and redundancy costs
Gain on closure of non-trading, legacy distribution business
Settlement of legacy onerous lease obligations
Year ended 31
December 2014
£m
Year ended 31
December 2013
£m
(1.2)
2.9
1.8
3.5
(2.8)
-
-
(2.8)
Business re-organisation gains and costs
Business re-organisation gains of £3.5 million comprise redundancy costs associated with rationalisation and synergy
projects offset by gains made on the favourable settlement of a number of legacy onerous leases.
Epwin Group Plc Annual Report and Accounts 2014
17
Site rationalisation and redundancy costs relate to the re-organisation programme within the Fabrication and Distribution
business. This is now largely completed. In 2013, the site rationalisation and redundancy costs relate to expenditure incurred
on projects to bring about synergistic benefits arising from the Epwin and Latium merger in 2012. They predominantly relate
to severance and site move costs in the Extrusion business.
The gain on closure of a non-trading, legacy distribution business generated a gain of £2.9 million as the business contained
certain property related liabilities which are now no longer due by the Group.
The settlement of onerous lease obligations relates to provisions made for legacy leases for vacant properties that have
subsequently either been settled for less than the amount provided or an alternative use has been found for the property.
Share based payments
Share based payments include the IFRS 2: Share-based payments charge in respect of the Management Incentive Plan
(£0.1 million) and warrants over ordinary shares issued as part of the IPO (£0.7 million).
Cash flow
Pre-tax operating cash flow
Tax paid
Acquisition of subsidiary
Net capital expenditure
Net interest paid
Proceeds of IPO
Net repayment of borrowings
Dividends
Discontinued operations
Net increase in cash and cash equivalents
Net funds / (debt)
Year ended 31
December 2014
£m
Year ended 31
December 2013
£m
19.9
(1.7)
-
(5.6)
(0.7)
10.0
(17.9)
(1.9)
(0.1)
2.0
1.1
12.9
(0.9)
(0.2)
(4.9)
(0.9)
-
(6.3)
-
(1.0)
(1.3)
(18.7)
Pre-tax operating cash flow increased by 54.3% to £19.9 million (2013: £12.9 million) demonstrating the strong cash
generative characteristics of the business. In addition to this, £10.0 million of funding was raised as part of the IPO
and, in combination with the operating cash inflow, was used to pay down the borrowings. After payment of interim
dividends of £1.9 million the Group ended the year in a net funds position of £1.1 million (2013: net debt £18.7 million).
Funding
As part of the IPO the Group renegotiated its existing banking facilities with Barclays. The new facility comprises of a
£25 million revolving credit facility and £5 million overdraft. The term of the revolving credit facility is for five years
ending July 2019.
www.epwin.co.uk
18
Key Performance Indicators
The Group has a range of performance indicators, both financial and
non-financial, that allow the Board to monitor the performance of the
Group as well as manage the business.
The Group has financial KPIs that it monitors on a regular basis at Board level and where relevant at operational
management meetings as follows:
KPI
Revenue
Underlying operating profit
Underlying operating margin
Adjusted EBITDA
Capital expenditure
Pre-tax operating cash flow
Cash conversion
Net cash/(debt)
Leverage ratio (net debt/adjusted EBITDA)
Basic EPS
Dividends declared
2014
2013
£259.5m
£255.3m
£18.3m
£13.3m
7.1%
5.2%
£24.5m
£21.4m
£6.1m
£5.0m
£19.9m
£12.9m
108.7%
97.0%
£1.1m
(£18.7m)
-
11.56p
£5.7m
0.87
4.09p
-
The Group also has non-financial KPIs that it monitors on a regular basis at Board level and where relevant
at operational management meetings as follows:
Tonnes/units manufactured
On time and in full deliveries (OTIF)
Tonnes/units sold
Stock turn
Debtor days
Employee output rates
Health and Safety RIDDOR incidents
Scrap rates
Customer complaints
Backorders
Supplier performance
Epwin Group Plc Annual Report and Accounts 2014
19
Principal Risks and Uncertainties
Epwin is affected by a number of risks and uncertainties, not all of which
are wholly within its control, which could have a material impact on the
Group’s long term performance.
This section is intended to highlight the principal risks and uncertainties affecting the Group’s business.
Epwin manages the risks inherent in its operations in order to mitigate exposure to all forms of risk, where practical.
The Board has identified several specific risks and uncertainties that potentially impact the ongoing business including:
Risk
UK economy
Key personnel
One of the key risks to the business is any deterioration
If we fail to attract and retain highly qualified key
in the UK economy. The level of activity in the RMI, new
personnel, our ability to execute our business model
build and social housing sectors has a direct impact on the
and strategy could be impaired.
levels of revenue, profitability and cash generation.
Key customers
The inability to retain key customers or collect our
receivables may cause our financial performance to suffer.
Commodity prices
Adverse movements in commodity prices such as PVC
glass and power will impact profit margins if the business
is unable to pass the costs onto customers.
Key suppliers
The Group relies upon certain key suppliers, particularly
those supplying raw material such as glass and PVC resin.
As a result, whilst alternative supply sources could be
Regulatory change
The Group recognises that the marketability of its
products could be impacted by changes in regulation
or government policy that in turn could adversely affect
revenues and profitability.
Integration of acquisitions
Acquisitions are an important growth option for the
Group. Realisation of synergies may not occur, or may
take significant time, resources and management
attention. Any acquisitions we make may adversely affect
our operations and, if not properly integrated, could
disrupt our business model and profitability.
identified, the Group is exposed to a number of risks,
The strategic report has been approved by the Board and
including the risk of supply disruption, the risk of key
has been signed on its behalf by:
suppliers increasing prices and the risk of key suppliers
suffering a quality issue which impacts upon the quality of
Jonathan Bednall
Christopher Empson
the Group’s products.
Chief Executive Officer
Group Finance Director
15th April 2015
www.epwin.co.uk
20
Epwin Group Plc Annual Report and Accounts 2014 21
Our Governance
Our Governance
Corporate Governance
Directors and Advisors
Directors’ Report
Directors’ Remuneration Report
022
030
032
036
Statement of Directors’ Responsibilities
040
www.epwin.co.uk 22
Corporate Governance
The Directors acknowledge the importance of the principles set out in the QCA Corporate Governance Code. The
Directors intend to apply the principles as far as they consider appropriate for a company of Epwin’s size and nature
in accordance with the QCA Corporate Governance Code for Small and Mid-Size Quoted Companies 2013.
The Board of Directors is responsible to shareholders for effective direction and control of the Group. This report
describes the framework for corporate governance and internal control that the Directors have established to enable
them to carry out this responsibility.
The Board’s main responsibilities are:
Providing leadership of the Group within a framework which enables risk to be assessed and managed
Reviewing and approving the overall Group strategy and direction
Reviewing and approving communications to shareholders
Reviewing operational and financial performance
Determining, maintaining and overseeing of controls, audit processes and risk management policies
Approving the year end and interim financial statements
Approving the annual budget
Approving significant agreements and contracts
Reviewing and approving acquisitions and disposals
Reviewing the environmental and health and safety performance of the Group
Reviewing and approving remuneration policies
Approving appointments to the Board
Monitoring and maintaining the Group’s financing relationships
Epwin Group Plc Annual Report and Accounts 2014 23
www.epwin.co.uk 24
Corporate Governance continued
Structure and composition
As at the date of this report, the Board comprised three Executive and two Non-Executive Directors. Andrew Eastgate is
Chairman of the Board of Directors and also Chairman of the Audit Committee and Nominations Committee.
Michael O’Leary is Chairman of the Remuneration Committee. Peter Mottershead was Chairman of the Board of Directors
Remuneration Committee and Nominations Committee until his resignation on 19 December 2014.
Appointed
Audit
Remuneration Nominations
Committee
Committee
Committee
Non-Executive
Chairman
14 July 2014
Chairman
Member
Chairman
Andrew
Eastgate
Jonathan
Bednall
Chief Executive
Officer
12 January 2012
-
Christopher
Group Finance
Empson
Director
17 June 2014
Shaun
Hanrahan
Executive
Director
17 June 2014
-
-
-
-
-
Member
-
-
Michael
O’Leary
Non-Executive
Director
2 March 2015
Member
Chairman
Member
Biographies of all the Directors at the date of this report, including those offering themselves for re-election at this year’s
Annual General Meeting on 26 May 2015, are set out on page 30.
Details of the terms of appointment and remuneration of both the Executive and Non-Executive Directors are set out in the
Directors’ Remuneration Report on page 36.
Chairman
The Chairman is responsible for leadership of the Board, ensuring its effectiveness, setting the Board’s agenda and ensuring
that adequate time is available for discussion of all agenda items.
The Chairman facilitates the effective contribution and performance of all Board members whilst identifying any
development needs of the Board. He also ensures that there is sufficient and effective communication with shareholders
to understand their issues and concerns.
Epwin Group Plc Annual Report and Accounts 2014
25
Chief Executive Officer
The Chief Executive Officer has day to day responsibility, within the authority delegated by the Board, for implementing
the Group’s strategy and running the Group.
Board committees
The Board is supported by Audit, Remuneration and Nomination Committees. Their specific responsibilities are set
out on the following page.
Details of attendance at scheduled Board and Board Committee meetings during the period following admission to AIM
on 24 July 2014 to 31 December 2014 are as follows:
Board
Audit
Committee
Remuneration
Committee
Nominations
Committee
Number Attended Number Attended Number Attended Number Attended
Andrew Eastgate
Jonathan Bednall
Christopher Empson
Shaun Hanrahan
Peter Mottershead*
5
5
5
5
5
5
5
5
5
5
2
n/a
n/a
n/a
2
2
n/a
n/a
n/a
2
0
n/a
n/a
n/a
0
0
n/a
n/a
n/a
0
1
1
n/a
n/a
1
1
1
n/a
n/a
0
*Peter Mottershead resigned as a Director of the company on 19 December 2014.
www.epwin.co.uk
26
Corporate Governance continued
The Board is supplied in a timely manner with the
During the period from admission to AIM on 24 July 2014
appropriate information to enable it to discharge its
to 31 December 2014, the Audit Committee met twice.
duties, including providing constructive challenge to, and
Its activities included:
scrutiny of, management. Further information is obtained
by the Board from the Executive Directors and other
relevant senior Executives as the Board, particularly its
Non-Executive members, considers appropriate.
Procedures are in place for Directors to take independent
professional advice, when necessary, at the Company’s
expense. No such advice was sought during the year
under review.
Reviewing the interim announcement to 30 June
2014.
Consideration of the audit plan for the year ended
31 December 2014.
Reviewing and ensuring the suitability of the
Committee’s Terms of Reference.
The Board is supported by the Company Secretary who,
under the direction of the Chairman, ensures good
Remuneration Committee
communication and information flows within the Board,
The Remuneration Committee comprised Andrew
including between Executive and Non-Executive Directors
Eastgate and Peter Mottershead, up to the date of his
and between the Board and its Committees.
resignation on 19 December 2014. On 2 March 2015
Michael O’Leary was appointed to the Board of Directors
If Directors have concerns that cannot be resolved
and as Chairman of the Remuneration Committee on
regarding the running of the Group or a proposed action,
24 March 2015.
they are encouraged to make their views known and
these are recorded in the Board minutes.
The Committee’s principal responsibilities include:
Audit Committee
During the year the Audit Committee comprised two
independent Non-Executive Directors: Andrew Eastgate
(Chairman) and Peter Mottershead, up to the date of his
resignation on 19 December 2014. On 2 March 2015
Michael O’Leary was appointed to the Board of Directors
and to the Audit Committee on 24 March 2015.
The Committee’s principal responsibilities include:
1) Reviewing and challenging the risk identification and
risk management processes across the business; and
2) Managing relations with the external auditor to
ensure the annual audit is effective, objective,
independent and of high quality; and
3) Reviewing the company’s corporate reporting.
Setting the remuneration policy for executive directors;
Reviewing the level and structure of remuneration for
senior management.
Full details of the role, policies and activities of the
Remuneration Committee are set out in the Directors’
Remuneration Report on pages 36.
Directors’ remuneration was set as part of the admission
to AIM, as such there has been no requirement for a
meeting of the Remuneration Committee during the
period from admission to 31 December 2014.
Epwin Group Plc Annual Report and Accounts 2014
27
Nominations Committee
The Nominations Committee comprised Andrew Eastgate
(Chairman) and Peter Mottershead, up to the date of his
resignation on 19 December 2014. On 2 March 2015
Michael O’Leary was appointed to the Board of Directors
and to the Nominations Committee on 24 March 2015.
The Committee’s principal responsibilities include:
Keeping under review the structure, size and
composition of the Board; and
First, only Directors who have no interest in the matter
being considered will be able to take the relevant decision,
and second, in taking the decision, the Directors must
act in a way which they consider, in good faith, will be
most likely to promote the Group’s success. The Directors
will be able to impose limits or conditions when giving
authorisation if they think this is appropriate.
Directors are required to notify the Company Secretary
of any additional conflict situation or if there is a
material change in a conflict situation previously notified,
giving sufficient details of the situation to allow the
Identifying and nominating candidates to fill Board
Board to make an informed decision when considering
vacancies; and
authorisation.
Considering succession planning for Directors and
other senior management.
Internal controls
The Committee meets as and when required and met
once during the year in order to consider the appointment
of an additional Non-Executive Director.
Directors’ conflicts of interest
Under the Companies Act 2006, a Director must avoid
a situation where he has, or can have, a direct or indirect
interest that conflicts, or possibly may conflict with the
Group’s interests. The requirement is considered very
broad and could apply, for example, if a Director becomes
a Director of another Company or a trustee of another
organisation. The Act allows Directors of public companies
The Board is responsible for maintaining a sound system
of internal control to safeguard shareholders’ investments
and the Group’s assets. Such a system is designed to
manage rather than eliminate the risk of failure to achieve
business objectives and can provide only reasonable and
not absolute assurance against material mis-statement
or loss.
Epwin is committed to conducting its business responsibly
and in accordance with all applicable laws and
regulations. Employees are encouraged to raise concerns
about fraud, bribery and other matters through a whistle-
blowing procedure.
to authorise conflicts and potential conflicts, where
The Group’s financial reporting processes are detailed
appropriate, provided that the articles of association
and regularly reviewed. The detailed reporting is reviewed
contain a provision to this effect. The Company’s articles
at least each month end by the members of the central
authorise the Directors to approve such situational
finance team, highlighting areas of concern and checking/
conflicts.
There are safeguards which will apply when Directors
decide whether to authorise a conflict or potential
conflict.
confirming that the reasons for variations are valid.
Quarterly reviews of each of the businesses are performed
by the Executive Directors covering both historic and
forthcoming financial and business performance as well
as anticipating key future events.
www.epwin.co.uk 28
Corporate Governance continued
In addition each business unit is required to submit a
Assignments of non-audit work have been and are subject
quarterly controls checklist which is signed locally to say
to controls by management that have been agreed by
that controls and reviews have been carried out both
the Audit Committee so that audit independence is not
during the month and as part of the month end close.
compromised.
These reports are also used to follow up on any non-
compliance points identified on these forms and are
reviewed by the relevant Divisional Financial Directors.
Auditor independence
The Audit Committee and the Board place great emphasis
on the objectivity of the external auditor in their reporting
to shareholders. The audit partner and senior manager
are present at Audit Committee meetings as required
to ensure full communication of matters relating to the
audit. The overall performance of the auditor is reviewed
annually by the Audit Committee, taking into account
the views of management, and feedback is provided
when necessary to senior members of KPMG unrelated
to the audit. This activity also forms part of KPMG’s own
system of quality control. The Audit Committee also
has discussions with the auditor on the adequacy of
controls and on any judgmental areas. These discussions
have proved satisfactory to date. The scope of the
forthcoming year’s audit is discussed in advance by the
Audit Committee. Audit fees are approved by the Audit
Committee after discussions between the Group Finance
Director and KPMG.
Rotation of the audit partner’s responsibilities within KPMG
is required by their profession’s ethical standards. There will
be rotation of the audit partner and key members within
the audit team as appropriate.
Other than audit, the Board is required to give prior
approval of work carried out by KPMG and its associates
in excess of £20,000. Part of this review is to determine
that other potential providers of the services have been
adequately considered. These controls provide the Audit
Committee with confidence in the independence of KPMG
in their reporting on the audit of the Group.
Relations with shareholders
The Board is committed to maintaining good
communications with shareholders. Other than during
close periods, the Chief Executive Officer and Group
Finance Director maintain a regular dialogue with
institutional shareholders and give presentations to
institutional shareholders and analysts immediately after
the announcement of the Group’s half year and full year
results. The Group also encourages communications with
private shareholders throughout the year and welcomes
their participation at shareholder meetings.
The Group maintains a corporate website (www.epwin.
co.uk), which complies with AIM Rule 26 and contains
a range of information of interest to institutional and
private investors including the Group’s annual and
half year reports, trading statements and all regulatory
announcements relating to the Group.
Epwin Group Plc Annual Report and Accounts 2014
29
The Board wishes to encourage the constructive use of the
Company’s AGM for shareholder communication.
The Chairman of the Board and the Chairmen of the Audit,
Remuneration and Nominations Committees will be available
to answer questions at the forthcoming AGM. Resolutions will
be proposed on each substantially separate issue and the level
of proxies cast for each resolution will be available at the AGM.
www.epwin.co.uk 30
Directors and Advisors
Andrew Eastgate
Non-Executive Chairman
Andrew was formerly a Partner at Pinsents where he
was head of Pinsents’ corporate practice in Birmingham.
Andrew has a broad experience of advising quoted
companies, particularly in connection with transactions
and compliance issues, and is currently a non-executive
director and Chairman of the audit committee of Headlam
Group Plc. Andrew was a director of the old Epwin holding
company between 2008 and 2012, and resigned on
the merger with the Latium businesses. Andrew joined
the Board on admission to AIM and became Chairman
following the resignation of Peter Mottershead on 19
December 2014.
Jonathan Bednall
Chief Executive Officer
Jon joined Epwin Group in 2008, becoming Group
Finance Director in 2009 and was appointed Chief
Executive Officer in 2013. Jon has been responsible for
the significant restructuring of Epwin in that time, as well
as devising and managing the merger with Latium in
2012. Jon has considerable group managerial experience,
including acquisition and disposals, having previously
spent 10 years at BI Group, a Kuwaiti owned engineering
group, becoming Group Finance Director and then Chief
Operating Officer. Prior to that Jon qualified as an ACA
at KPMG in Birmingham where he spent six years in a
number of roles.
Christopher Empson
Group Finance Director
Chris has been with Epwin since 2012, having joined
to assist with the business integration and development
following the Latium merger. Before this Chris was a
divisional Finance Director within Rentokil Initial Plc, having
previously worked at BI Group as Group Finance Director.
Chris also spent five years with 3i after qualifying as an
ACA at PricewaterhouseCoopers. Chris has considerable
group management experience, including in corporate
transactions.
Shaun Hanrahan
Executive Director
Shaun has been with Epwin since the Group acquired
Swish Building Products from Williams Holdings in 2000.
Shaun has overseen the growth of Swish Building Products
to a position of market strength, bringing a wealth of
market knowledge and commercialism to the Group. Prior
to his time at Swish, Shaun was a Business Analyst at Baco,
British Alcan and Williams Holdings working on post-
acquisition projects at companies in the UK and Europe
including Rawlplug, Polycell and Fairey Engineering.
Michael O’Leary
Non-executive Director
Mike was appointed to the Board as a non-executive
Director on 2 March 2015. Mike was joint Chief Operating
Officer at Misys Plc between 1986 and 2000, running
both their UK Insurance Division and US Healthcare
Division. He was then Chief Executive Officer of Huon
Corporation and also Marlborough Stirling Plc. Since 2005
he has undertaken a number of non-executive roles. He is
currently Non-executive Chairman of Emis Group Plc and
a Non-executive Director of Headlam Group Plc, where
he has served since March 2006.
Epwin Group Plc Annual Report and Accounts 2014 31
Registered office
1b Stratford Court
Nominated advisor and
Registrars
broker
Capita Registrars Limited
Cranmore Boulevard
Zeus Capital Limited
The Registry
Solihull
B90 4QT
Company number
07742256
Auditors
KPMG LLP
One Snowhill
Snow Hill Queensway
Birmingham
B4 6GH
34 Beckenham Road
Beckenham
BR3 4TU
Company Secretary
Christopher Empson
82 King Street
Manchester
M2 4WQ
Bankers
Barclays
4th Floor, Bridgewater House
Counterslip
Finzels Reach
Bristol
BS1 6BX
www.epwin.co.uk 32
Directors’ Report
The Directors present their report together with the audited financial
statements for the year ended 31 December 2014.
Full biographical details of the Company’s Directors as at
the date of this report are given on page 30.
The directors’ remuneration and their interests in the share
capital of the Company are detailed on pages 36 to 39.
Directors’ and officers’ liability insurance
The Company has purchased insurance to cover its
directors and officers against costs of defending
themselves in legal proceedings taken against them in that
capacity and in respect of any damages resulting from
those proceedings. The insurance does not provide cover
where the director has acted fraudulently or dishonestly.
Supplier payment policy
The Group agrees payment terms with its suppliers when it
enters into binding purchase contracts. The Group seeks to
abide by the payment terms agreed whenever it is satisfied
that the supplier has provided the goods or services in
accordance with the agreed terms and conditions. The
Group seeks to treat all suppliers fairly, but it does not
have a Group-wide standard or code of practice that deals
specifically with payment to suppliers. Trade payables at
31 December 2014 represented on average 53 days credit
based on actual invoices received (2013: 49 days credit).
Financial results and dividends
The audited accounts for the Group and Company for
the year ended 31 December 2014 are set out on pages
46 to 101. The Group profit for the year after taxation
from continuing operations was £15.1 million (2013: £6.5
million). The Board recommends the payment of a final
dividend of 2.83 pence per ordinary share. If approved, the
final dividend will be paid on 8 June 2015 to shareholders
on the register at the close of business on 15 May 2015.
Directors and directors’ interests
The directors who held office during the year and to the
date of this report were as follows:
A K Eastgate
(appointed 14 July 2014)
J A Bednall
C A Empson
(appointed 17 June 2014)
S P Hanrahan
(appointed 17 June 2014)
M K O’Leary
(appointed 2 March 2015)
P D L Mottershead
(appointed 14 July 2014, resigned 19 December 2014)
A J Rawson
(resigned 17 June 2014)
B G Kennedy
(resigned 17 June 2014)
D J Challinor
(resigned 25 June 2014)
Epwin Group Plc Annual Report and Accounts 2014
33
Share capital
The issued share capital of the Company at 31 December 2014 was £85,500, comprising of 135,000,000 ordinary shares
of 0.05 pence each and 18,000 deferred shares of £1 each.
The Directors will be seeking authority at the forthcoming Annual General Meeting to renew their authority to allot shares
and to repurchase ordinary and deferred shares. Full details of these resolutions, together with explanatory notes, are
contained in the Notice of Annual General Meeting on pages 104 to 111.
Substantial shareholdings
As at 15th April 2015, the following shareholders own more than 3% of the issued share capital of the Company:
% of issued share capital
Number of shares
AJ Rawson
C Kennedy
Schroder Plc
Henderson Global Investors
Premier Fund Managers
AXA Investment Managers UK
Unicorn Asset Management
Ruffer LLP
Chelverton Asset Management
15.00
15.00
12.00
9.77
9.11
7.57
6.89
5.90
3.59
20,250,000
20,250,000
16,195,915
13,200,000
12,303,121
10,218,750
9,299,805
7,965,000
4,850,000
www.epwin.co.uk
34
Directors Report continued
Charitable and political donations
Auditor
The Group made no charitable donations during the year.
KPMG LLP have expressed their willingness to continue
Going concern
As highlighted in note 1 to the financial statements, the
Group meets its day to day working capital requirements
through an overdraft and revolving credit facility which
in office as auditors and a resolution proposing their re-
appointment will be proposed at the forthcoming Annual
General Meeting.
Disclosure of information to the auditor
is due for renewal in July 2019.
As required by Section 418 of the Companies Act 2006,
Further information on the Group’s business activities,
together with the factors likely to affect its future
each Director serving at the date of approval of the
financial statements confirms that:
development, performance and position is set out in the
to the best of his knowledge and belief, there is no
Strategic Report on pages 10 to 19. In addition, note 26
information relevant to the preparation of their report
to the financial statements details the Group’s objectives,
of which the Company’s auditors are unaware; and
policies and processes for managing its capital and its
exposures to credit risk and liquidity risk.
each Director has taken all the steps a director might
reasonably be expected to have taken to be aware of
The Group’s forecasts and projections, taking account
relevant audit information and to establish that the
of possible changes in trading performance, show that
Company’s auditors are aware of that information.
the Group should be able to operate within the level
of its current facilities.
Words and phrases used in this confirmation should
be interpreted in accordance with Section 418 of the
After making enquiries, the Board has a reasonable
Companies Act 2006.
expectation that the Company and the Group have
adequate resources to continue in operational existence
for the foreseeable future. Accordingly, they continue to
Employees
adopt the going concern basis in preparing the annual
Our employment policies, including a commitment to
report and accounts.
Annual General Meeting
equal opportunity, are designed to attract and retain
high-calibre individuals, regardless of age, sex, religion,
disability, marital status, race, ethnicity, nationality or
sexual orientation. Applications for employment by
The Annual General Meeting of the Company will be held
disabled persons are given full and fair consideration for
on 26 May 2015 at Eversheds LLP, 115 Colmore Row,
all vacancies in accordance with their particular aptitudes
Birmingham B3 3AL. The Notice setting out details of the
and abilities. In the event of employees becoming
business to be considered at the meeting is included on
disabled, every effort is made to retain them in order
pages 104 to 111.
that their employment with the Group may continue.
Epwin Group Plc Annual Report and Accounts 2014 35
We take measures to ensure good working conditions. Employees are expected at all times to act honestly, respectfully, and
in accordance with our Company policies. The Company does not tolerate misconduct or harassment in any form and will
diligently investigate and, where necessary, take action following any complaints, including those of confidential
“whistle-blowers.”
The Group keeps its employees informed of matters affecting them as employees through regular team briefings throughout
the year. We value employees’ opinions and seek to actively consult them in the decision making process and keep them
appraised of company news.
The average number of employees within the Group is shown in note 8 to the financial statements on page 71.
By order of the Board
Christopher Empson
Group Finance Director
1b Stratford Court
Cranmore Boulevard
Solihull
B90 4QT
15th April 2015
www.epwin.co.uk
36
Directors’ Remuneration Report
Remuneration Committee and advisers
total rewards should be set to provide a fair and
The Committee reviews the Company’s policy on the
remuneration and terms of engagement of the Executive
Directors and Senior Management Team. Executive
Directors attend by invitation only when appropriate
and are not present at any discussion of their own
remuneration.
The members of the Remuneration Committee and
details of attendance at the meetings are disclosed in
the Corporate Governance report on pages 24 and 25.
The Committee members have no personal financial
interest, other than as shareholders, in the matters to be
decided. They have no conflicts of interest arising from
cross-directorships or from being involved in the day-to-
day business of the Group. The Committee members do
not participate in any bonus, share awards or pension
arrangements.
Remuneration policy
The Group operates in a highly competitive environment,
the Board and Remuneration Committee of Epwin aim
to ensure the Group has the best possible team to drive
continued success and creation of shareholder value.
For the Group to continue to compete successfully, it
is essential that the level of remuneration and benefits
offered achieve the objectives of attracting, retaining,
motivating and rewarding the necessary high calibre of
individuals at all levels across the Group.
The Group therefore sets out to provide competitive
remuneration to all its employees, appropriate to the
business environment in the market in which it operates.
To achieve this, the remuneration package is based upon
the following principles:
attractive remuneration package;
appropriate elements of the remuneration package
should be designed to reinforce the link between
performance and reward; and
Executive Directors’ incentives should be aligned with
the interests of shareholders.
Remuneration of Executive Directors
The Company’s remuneration policy contains the following
remuneration components:
Fixed remuneration components
Fixed remuneration components play a key role in
attracting, retaining and motivating high calibre and higher
performing executives. Fixed remuneration consists of
three components:
Basic salary or fees
Basic salaries or fees are approved by the Remuneration
Committee on an annual basis after taking into
consideration the performance of the individuals, their
levels of responsibility and rate of salary or fees for
similar positions in comparator companies.
Pensions
The Group makes defined contributions on behalf of
the Directors into their individual pension plans based
on a percentage of basic salary
The amounts paid in the financial year are set out in
the Directors’ emoluments table on page 38.
Epwin Group Plc Annual Report and Accounts 2014 37
Other taxable benefits
These principally comprise car benefits, life assurance
and membership of the Group’s healthcare insurance
scheme or payment in lieu of these benefits. These
benefits do not form part of pensionable earnings.
Under the Management Incentive Plan, the Executive
Directors and certain senior employees acquired shares
in a subsidiary of the Group at par value. Subject to
continuing employment and the attainment of specific
performance targets, the employees will be able to
exchange these shares for ordinary shares of Epwin Group
Variable remuneration components
Plc equal to 12.5% of the increase in market capitalisation
Variable remuneration components directly link an
generated in excess of the hurdle rate of £175 million,
individual’s reward, over both the short and the long term,
subject to a cap of £12.5 million.
to their contributions to the success of the Group. The
schemes ensure that only high performance is rewarded
with high reward and that failure is not rewarded.
The purpose of the Management Incentive Plan was to
incentivise key members of the management team by
granting rights to acquire shares based on an increase
Annual performance related bonuses
in market capitalisation, thus aligning their interests with
Performance related bonuses for the Executive
Directors are contractual and are determined by
reference to performance targets based on the Group’s
financial results set at the beginning of the financial
shareholders.
Non-Executive Directors’ remuneration
year. Awards are capped at a maximum of 100% of
The Non-Executive Directors receive fees set at a level
the individual’s basic pay. Terms and conditions are
commensurate with their experience and ability to make
based on the recommendations of the Remuneration
a contribution to the Group’s affairs and are set by the
Committee.
Board as a whole. No other incentives, pensions or other
benefits are available to the Non-Executive Directors.
Long term incentive arrangements
The Group strongly believes that employee share
ownership strengthens the link between employee’s
personal interests and those of the Group and its
shareholders, as well as strengthening employee retention
and motivation. With the aim of linking an individual’s
remuneration to Company performance over the longer
term, the Group currently operates a long term, share
based incentive plan.
In 2014, the Group established the Management Incentive
Plan to create a stronger link between the interests
of senior employees, and those of the Group and our
shareholders, and to support retention in key roles.
www.epwin.co.uk 38
Directors’ Remuneration Report continued
Details of the Directors’ emoluments, share awards and shareholdings are given below and form part of the audited
financial statements.
Salary
and fees
2014
£000
200
65
81
7
-
-
19
30
Other
taxable
benefits
2014
£000
8
5
8
-
-
-
-
-
Bonus
Pension
contributions
Total
Total
2014
£000
100
49
38
-
-
-
-
-
2014
£000
24
2014
£000
332
2013
£000
332
8
127
15
142
-
-
-
-
-
7*
**
**
19
30
-
-
87*
**
**
-
-
EXECUTIVE
J A Bednall
C A Empson
(appointed 17 June 2014)
S P Hanrahan
(appointed 17 June 2014)
A J Rawson
(resigned 17 June 2014)
B G Kennedy
(resigned 17 June 2014)
D J Challinor
(resigned 25 June 2014)
NON-EXECUTIVE
A K Eastgate
(appointed 14 July 2014)
P D L Mottershead
(appointed 14 July 2014,
resigned 19 December 2014)
Total
402
21
187
47
657
419
* Fees of £0.5 million (2013: £0.9 million) were paid in the period from 1 January 2014 to 24 July 2014 to Pentwin Limited, a company controlled by
A J Rawson.
** Fees of £0.7 million (2013: £1.3 million) were paid in the period from 1 January 2014 to 24 July 2014 to Latium Management Services Limited a company
controlled by B G Kennedy and which employs D J Challinor.
Epwin Group Plc Annual Report and Accounts 2014
39
Long term incentives vested during the financial year
Awards were made to JA Bednall, CA Empson, SP Hanrahan and other senior employees under the Management Inventive
Plan on 14 July 2014. The Management Incentive Plan grants the award holder a variable number of ordinary shares of
Epwin Group Plc based on the increase in the market capitalisation of the Group over a 3 year period and also the Group
achieving certain earnings targets. If the market capitalisation of the Group is in excess of £175 million on 14 July 2017
the award holders will be entitled to ordinary shares equal to 12.5% of the excess, subject to a cap of £12.5 million. As
the number of shares awarded is variable, based on the increase in market capitalisation achieved, it is not possible to
quantify the number of awards granted to each Executive Director.
Directors’ service agreements
The service agreements of the Executive Directors entitle them on termination to payments in lieu of notice equal to salary,
benefits and pension contributions for a period of 12 months or less if the Director finds alternative full time employment.
There will be no compensation for loss of office due to misconduct or resignation by the Directors.
Non-Executive Directors are appointed for an initial period of 3 years, subject to reappointment at the forthcoming AGM.
Directors’ shareholdings
The interests of the Directors’ who held office at 31 December 2014 in the ordinary share capital of the Company are as
shown in the table below.
EXECUTIVE
Jonathan Bednall
Christopher Empson
Shaun Hanrahan
NON-EXECUTIVE
Andrew Eastgate
As at 31 December 2014
As at 31 December 2013
Number
578,500
39,200
-
Number
5,000
Number
260*
-
100**
Number
-
* As at 31 December 2013 Jonathan Bednall held 260 ordinary C1 shares of 1 pence each which were part realised during the capital restructuring performed
as part of the IPO.
** As at 31 December 2013 Shaun Hanrahan held 100 ordinary C3 shares of 1 pence each which were realised during the capital restructuring performed as
part of the IPO.
This report has been approved by the Board and has been signed on its behalf by:
Michael O’Leary
Chairman of the Remuneration Committee
15th April 2015
www.epwin.co.uk
40
Statement of Directors’ Responsibilities
in respect of the annual report and accounts
The Directors are responsible for preparing the Annual
for the parent company financial statements, state
Report and the Group and parent company financial
whether applicable UK Accounting Standards have
statements in accordance with applicable law and
been followed, subject to any material departures
regulations.
disclosed and explained in the financial statements;
Company law requires the Directors to prepare Group
and
and parent company financial statements for each
prepare the financial statements on the going
financial year. As required by the AIM Rules of the
concern basis unless it is inappropriate to presume
London Stock Exchange they are required to prepare
that the Group and the parent company will
the Group financial statements in accordance with
continue in business.
IFRSs as adopted by the EU and applicable law and
have elected to prepare the parent company financial
statements in accordance with UK Accounting
Standards and applicable law (UK Generally Accepted
Accounting Practice).
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and
explain the parent company’s transactions and disclose
with reasonable accuracy at any time the financial
position of the parent company and enable them to
Under company law the Directors must not approve
ensure that its financial statements comply with the
the financial statements unless they are satisfied that
Companies Act 2006. They have general responsibility
they give a true and fair view of the state of affairs of
for taking such steps as are reasonably open to them
the Group and parent company and of their profit or
to safeguard the assets of the Group and to prevent
loss for that period. In preparing each of the Group
and detect fraud and other irregularities.
and parent company financial statements, the
Directors are required to:
The Directors are responsible for the maintenance
and integrity of the corporate and financial
select suitable accounting policies and then apply
information included on the Company’s website.
them consistently;
Legislation in the UK governing the preparation and
dissemination of financial statements may differ from
make judgments and estimates that are reasonable
legislation in other jurisdictions.
and prudent;
for the Group financial statements, state whether
they have been prepared in accordance with IFRSs
as adopted by the EU;
Epwin Group Plc Annual Report and Accounts 2014 41
www.epwin.co.uk 42
Epwin Group Plc Annual Report and Accounts 2014 43
Financial Statements
Financial Statements
Independent Auditor’s Report
Consolidated Income Statement
Consolidated Balance Sheet
Consolidated Statement of
Changes in Equity
Consolidated Cash Flow Statement
Notes to the Accounts
Company Balance Sheet
Notes to the Company Accounts
044
046
047
048
049
051
096
097
www.epwin.co.uk 44
Independent Auditor’s Report
to the members of Epwin Group Plc
We have audited the financial statements of Epwin Group Plc for the year ended 31 December 2014 set out on pages 46
to 101.
The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable
law and International Financial Reporting Standards (IFRSs) as adopted by the EU. The financial reporting framework that
has been applied in the preparation of the parent Company financial statements is applicable law and UK Accounting
Standards (UK Generally Accepted Accounting Practice).
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies
Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are
required to state to them in an Auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than the Company and the Company’s members, as a body, for our audit
work, for this report, or for the opinions we have formed.
Respective responsibilities of Directors and auditors
As explained more fully in the Directors’ Responsibilities Statement set out on page 40, the Directors are responsible for the
preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to
audit, and express an opinion on, the financial statements in accordance with applicable law and International Standards
on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s Ethical Standards
for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is provided on the Financial Reporting Council’s web-site at
www.frc.org.uk/auditscopeukprivate
Opinion on financial statements
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 31 December 2014 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 EU;
the parent company financial statements have been properly prepared in accordance with UK Generally
Accepted Accounting Practice;
the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
Epwin Group Plc Annual Report and Accounts 2014 45
Opinion on other matter prescribed by the Companies Act 2006
In our opinion 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.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report
to you if, in our opinion:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit
have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of Directors’ remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Michael Froom
(Senior Statutory Auditor)
for and on behalf of
KPMG LLP, Statutory Auditor
Chartered Accountants
One Snowhill
Snow Hill Queensway
Birmingham
B4 6GH
15 April 2015
www.epwin.co.uk
46
Consolidated Income Statement and Other
Comprehensive Income
(restated,
see note 6)
for the year ended 31 December 2014
Group revenue
Cost of sales
Gross profit
Distribution expenses
Administrative expenses
Underlying operating profit
Amortisation of acquired intangible assets
Business re-organisation
Share-based payments
Operating profit from continuing operations
Net finance costs
Profit before tax
Taxation
Profit from continuing operations
Loss from discontinued operations net of tax
Profit for the year and total comprehensive income
Earnings per share
Basic
Basic - continuing operations
Basic – discontinued operations
Diluted
Diluted – continuing operations
Diluted – discontinued operations
Note
1
15
7
9
10
11
6
12
12
12
12
12
12
2014
£m
2013
£m
259.5
255.3
(186.7)
(185.8)
72.8
(23.3)
(30.2)
18.3
(1.7)
3.5
(0.8)
19.3
(0.7)
18.6
(3.5)
15.1
(0.3)
14.8
69.5
(26.4)
(34.3)
13.3
(1.7)
(2.8)
-
8.8
(1.0)
7.8
(1.3)
6.5
(1.5)
5.0
pence
pence
11.56
11.76
(0.20)
11.55
11.75
(0.20)
4.09
5.32
(1.23)
4.09
5.32
(1.23)
Epwin Group Plc Annual Report and Accounts 2014
Consolidated Balance Sheet
as at 31 December 2014
Assets
Non-current assets
Goodwill
Other intangible assets
Property, plant and equipment
Deferred tax
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
Total assets
Liabilities
Current liabilities
Other interest bearing loans and borrowings
Trade and other payables
Income tax payable
Provisions
Non-current liabilities
Other interest bearing loans and borrowings
Other payables
Provisions
Total liabilities
Net assets
Equity
Ordinary share capital
Share premium
Merger reserve
Retained earnings
Total equity
Note
14
15
17
24
18
19
20
22
21
23
22
21
23
25
25
25
47
2013
£m
24.5
1.9
25.1
3.2
54.7
21.7
40.1
0.3
62.1
2014
£m
24.5
0.2
26.2
2.9
53.8
22.4
37.6
2.3
62.3
116.1
116.8
0.4
45.6
2.0
1.0
49.0
0.8
-
3.5
4.3
53.3
62.8
0.1
12.5
15.6
34.6
62.8
3.0
47.9
0.5
3.1
54.5
16.0
2.7
7.0
25.7
80.2
36.6
-
-
27.0
9.6
36.6
The financial statements were approved by the Board of Directors and authorised for issue on 15 April 2015.
They were signed on its behalf by:
Jonathan Bednall
Chief Executive Officer
Christopher Empson
Group Finance Director
Company number:
07742256
www.epwin.co.uk
48
Consolidated Statement of Changes in Equity
Share
capital
£m
Share
premium
£m
Merger
reserve
£m
Retained
earnings
£m
Total
£m
27.0
4.6
31.6
for the year ended 31 December 2014
Balance as at 31 December 2012
Comprehensive income:
Profit for the year
Total comprehensive income:
Balance as at 31 December 2013
Comprehensive income:
Profit for the year
Total comprehensive income:
-
-
-
-
-
-
-
-
-
-
-
-
2.5
-
-
10.0
-
-
-
-
-
27.0
-
-
-
(11.4)
-
-
-
-
-
5.0
5.0
9.6
5.0
5.0
36.6
14.8
14.8
14.8
14.8
-
-
11.3
-
0.1
0.7
(1.9)
10.2
34.6
2.5
-
-
10.0
0.1
0.7
(1.9)
11.4
62.8
Transactions with owners recorded directly in equity:
Issue of shares (pre IPO)
Bonus issue of shares
Cancellation of shares
IPO share placing
Share-based payments
Share warrants issued on IPO
Dividends
-
11.4
(11.3)
-
-
-
-
Total transactions with owners
Balance as at 31 December 2014
0.1
0.1
12.5
(11.4)
12.5
15.6
Epwin Group Plc Annual Report and Accounts 2014
Consolidated Cash Flow Statement
for the year ended 31 December 2014
Note
15 & 17
10
11
9
6
5
25
Cash flows from operating activities
Profit for the year
Adjustments for:
Depreciation and amortisation
Net finance costs
(Profit) on disposal of property, plant and equipment
Taxation
Share-based payments
Loss from discontinued operations net of tax
Operating cash flow before movement in working capital
(Increase) in inventories
Decrease/(increase) in trade and other receivables
(Decrease)/increase in trade and other payables
(Decrease) in provisions
Tax paid
Net cash inflow from operating activities
Cash flow from investing activities
Acquisition of subsidiary, net of cash acquired
Acquisition of property, plant and equipment
Receipts from disposal of property, plant and equipment
Net cash (outflow) from investing activities
Cash flow from financing activities
Interest paid
Proceeds from the issue of share capital
Repayment of borrowings
Transaction costs related to loans and borrowings
Capital element of finance lease rental payments
Dividends paid
Net cash (outflow) from financing activities
Discontinued operations
Net cash flow from operating activities
Net cash (outflow) from discontinued operations
Net increase/(decrease) in cash and cash equivalents
49
(restated,
see note 6)
2013
£m
5.0
7.6
1.0
(0.1)
1.3
-
1.5
16.3
(0.8)
(2.7)
0.9
(0.8)
12.9
(0.9)
12.0
(0.2)
(5.2)
0.3
(5.1)
(0.9)
-
(5.8)
(0.1)
(0.4)
-
(7.2)
(1.0)
(1.0)
(1.3)
2014
£m
14.8
6.7
0.7
(0.1)
3.5
0.8
0.3
26.7
(0.9)
2.4
(2.7)
(5.6)
19.9
(1.7)
18.2
-
(5.7)
0.1
(5.6)
(0.7)
10.0
(17.6)
-
(0.3)
(1.9)
(10.5)
(0.1)
(0.1)
2.0
www.epwin.co.uk
50
Consolidated Cash Flow Statement continued
for the year ended 31 December 2014
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of year
Cash and cash equivalents at end of year
Secured bank loans
Finance lease liabilities
Net cash/(debt)
Note
20
22
22
2014
£m
2.0
0.3
2.3
-
(1.2)
1.1
(restated,
see note 6)
2013
£m
(1.3)
1.6
0.3
(18.4)
(0.6)
(18.7)
Epwin Group Plc Annual Report and Accounts 2014
Consolidated Cash Flow Statement continued
for the year ended 31 December 2014
Notes to the Accounts
for the year ended 31 December 2014
51
1. Accounting policies
1.1 Basis of preparation
Epwin Group Plc (the “Company”) is a company incorporated and domiciled in the United Kingdom.
The Group financial statements consolidate those of the Company and its subsidiaries (together referred to as the “Group”).
The Group financial statements have been prepared and approved by the directors in accordance with International Financial
Reporting Standards as adopted by the EU (“Adopted IFRSs”).
The financial statements of the parent company have been prepared in accordance with United Kingdom Generally
Accepted Accounting Practice (“UK GAAP”) and presented from page 96.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in
these Group financial statements.
Judgements made by the directors in the application of these accounting policies, that have a significant effect on the
financial statements and estimates with a significant risk of material adjustment in the next year, are discussed in note 2.
The financial statements are prepared on the historical cost basis except where Adopted IFRSs require an alternative
treatment.
1.2 Going concern
The Group financial statements are prepared on a going concern basis as the directors have a reasonable expectation that
the Group has adequate resources to continue in operational existence for the foreseeable future. The Group has considered
financial resources, together with a strong ongoing trading performance. The bank facilities are available until July 2019.
The Group has prepared a detailed business plan, including cash projections, for the period to 31 December 2017 and has
applied sensitivities to these plans. These plans, and sensitised forecasts, demonstrate that the Group’s current facilities
provide adequate headroom for its current and future anticipated cash requirements.
www.epwin.co.uk 52
Notes to the Accounts continued
for the year ended 31 December 2014
1.3 Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to,
variable returns from its involvement with the entity and has the ability to affect those returns through its power over the
entity. In assessing control, the Group takes into consideration potential voting rights that are currently exercisable. The
acquisition date is the date on which control is transferred to the acquirer. The financial statements of subsidiaries are
included in the consolidated financial statements from the date that control commences until the date that control ceases.
Losses applicable to the non-controlling interests in a subsidiary are allocated to the non-controlling interests even if doing
so causes the non-controlling interests to have a deficit balance.
1.4 Foreign currencies
Transactions in foreign currencies are translated to the respective functional currency of the Group at the foreign exchange
rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance
sheet date are retranslated to the functional currency at the foreign exchange rate ruling at that date. Foreign exchange
differences arising on translation are recognised in the consolidated statement of comprehensive income.
1.5 Classification of financial instruments issued by the Group
Financial instruments issued by the Group are treated as equity only to the extent that they meet the following two
conditions:
a) they include no contractual obligations upon the Group to deliver cash or other financial assets or to exchange financial
assets or financial liabilities with another party under conditions that are potentially unfavourable to the Group; and
b) where the instrument will or may be settled in the company’s own equity instruments, it is either a non-derivative that
includes no obligation to deliver a variable number of the company’s own equity instruments or is a derivative that will
be settled by the company’s exchanging a fixed amount of cash or other financial assets for a fixed number of its own
equity instruments.
To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. Where the instrument
so classified takes the legal form of the company’s own shares, the amounts presented in these financial statements for
called up share capital exclude amounts in relation to those shares.
Where a financial instrument that contains both equity and financial liability components exists, these components are
separated and accounted for individually under the above policy.
Epwin Group Plc Annual Report and Accounts 2014 53
1.6 Financial instruments
Financial Assets
The Group’s financial assets include cash and cash equivalents and trade and other receivables. All financial assets are
recognised when the Group becomes party to the contractual provisions of the instrument.
i)
Trade receivables
Trade receivables are recognised and carried at original invoice amount less provision for impairment.
A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be
able to collect all amounts due according to the original terms of receivables. The amount of the provision is determined
as the difference between the asset’s carrying amount and the present value of estimated future cash flows, and is
recognised in the consolidated income statement in administrative expenses.
ii) Cash and cash equivalents
Cash and cash equivalents comprise cash in hand and deposits held at call with banks. For the purpose of the
consolidated cash flow statement, cash and cash equivalents includes bank overdrafts in addition to the definition
above.
Financial Liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered
into. An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of
its liabilities.
The Group’s financial liabilities comprise trade and other payables and borrowings. All financial liabilities are recognised
initially at their fair value and subsequently measured at amortised cost using the effective interest method.
i) Bank borrowings
All loans and borrowings are initially recognised at the fair value of the consideration received net of issue costs
associated with the borrowing. Borrowings are subsequently stated at amortised cost; any difference between the
proceeds (net of transaction costs) and the redemption value is recognised in the statement of profit and loss over
the period of the borrowings using the effective interest method.
Financial expenses comprise interest expense on borrowings.
ii) Trade payables
Trade payables are initially measured at fair value, and are subsequently measured at amortised cost, using the effective
interest rate method.
www.epwin.co.uk
54
Notes to the Accounts continued
for the year ended 31 December 2014
1.7 Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.
Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate
items of property, plant and equipment.
Leases in which the Group assumes substantially all the risks and rewards of ownership of the leased asset are classified
as finance leases. Where land and buildings are held under leases the accounting treatment of the land is considered
separately from that of the buildings. Leased assets acquired by way of finance lease are stated at an amount equal to the
lower of their fair value and the present value of the minimum lease payments at inception of the lease, less accumulated
depreciation and less accumulated impairment losses. Lease payments are accounted for as described below.
Depreciation is charged to the consolidated statement of profit and loss on a straight-line basis over the estimated useful
lives of each part of an item of property, plant and equipment. The estimated useful lives are as follows:
Leasehold improvements
over the term of the lease
Fixtures, fittings and equipment
Motor Vehicles
3-15 years
4 years
Depreciation methods, useful lives and residual values are reviewed at each balance sheet date.
1.8 Business combinations
Business combinations are accounted for using the acquisition method at the acquisition date, which is the date on which
control is transferred to the Group.
The Group measures goodwill at the acquisition date as:
the fair value of the consideration transferred; plus
the fair value of the existing equity interest in the acquiree; less
the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed.
Costs relating to the acquisition, other than those associated with the issue of debt or equity securities, are expensed
as incurred.
Any contingent consideration payable is recognised at fair value at the acquisition date. If the contingent consideration
is classified as equity, it is not re-measured and settlement is accounted for within equity. Otherwise, subsequent changes
to the fair value of the contingent consideration are recognised in profit or loss.
Epwin Group Plc Annual Report and Accounts 2014
55
1.9 Intangible assets and goodwill
Goodwill
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash-generating units and is not
amortised but tested annually for impairment.
Other intangible assets
Other intangible assets that are acquired by the Group are stated at cost less accumulated amortisation and accumulated
impairment losses.
Amortisation
Amortisation is charged to the statement of profit and loss on a straight-line basis over the estimated useful lives
of intangible assets unless such lives are indefinite. Intangible assets with an indefinite useful life and goodwill are
systematically tested for impairment at each balance sheet date. Other intangible assets are amortised from the date they
are available for use. The estimated useful lives are as follows:
Brand
Customer relationships
1.10 Inventories
10 years
3 years
Inventories are stated at the lower of cost and net realisable value. Cost is based on the weighted average principle and
includes expenditure incurred in acquiring the inventories, production or conversion costs and other costs in bringing them
to their existing location and condition. In the case of manufactured inventories and work in progress, cost includes an
appropriate share of overheads based on normal operating capacity.
1.11 Impairment excluding inventories and deferred tax assets
Financial assets (including receivables)
A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there
is objective evidence that it is impaired. A financial asset is impaired if objective evidence indicates that a loss event has
occurred after the initial recognition of the asset, and that the loss event has a negative effect on the estimated future cash
flows of that asset that can be estimated reliably.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its
carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest
rate. Interest on the impaired asset continues to be recognised through the unwinding of the discount. When a subsequent
event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss.
www.epwin.co.uk
56
Notes to the Accounts continued
for the year ended 31 December 2014
Non-financial assets
The carrying amounts of the Group’s non-financial assets, other than inventories and deferred tax assets, are reviewed
at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the
asset’s recoverable amount is estimated. For goodwill, and intangible assets that have indefinite useful lives or that are not
yet available for use, the recoverable amount is estimated each year at the same time.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to
sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose
of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that
generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of
assets (the “cash-generating unit”). The goodwill acquired in a business combination, for the purpose of impairment testing,
is allocated to cash-generating units, (“CGU”). Subject to an operating segment ceiling test, for the purposes of goodwill
impairment testing, CGUs to which goodwill has been allocated are aggregated so that the level at which impairment
is tested reflects the lowest level at which goodwill is monitored for internal reporting purposes. Goodwill acquired in a
business combination is allocated to groups of CGUs that are expected to benefit from the synergies of the combination.
An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount.
Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of CGUs are allocated first to
reduce the carrying amount of any goodwill allocated to the units, and then to reduce the carrying amounts of the other
assets in the units on a pro rata basis.
An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised in
prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An
impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An
impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that
would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.
1.12 Employee benefits
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which the company pays fixed contributions into a
separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to
defined contribution pension plans are recognised as an expense in the statement of profit and loss in the periods during
which services are rendered by employees.
Epwin Group Plc Annual Report and Accounts 2014 57
Share based payments
The Group grants share options to certain employees, which may, if certain performance criteria are met, allow these
employees to acquire shares in the Company. The specific schemes are detailed in note 9 to the accounts.
The share options are measured at fair value at the date of grant and recognised as an employee expense, with a
corresponding increase in equity, on a straight-line basis over the vesting period. The fair value of the options granted
is measured using an option pricing model, taking into account the terms and conditions upon which the options were
granted. The amount recognised as an expense is adjusted to reflect the actual number of share options that vest except
where variations are due only to share prices not achieving the threshold for vesting.
Short-term benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service
is provided. A liability is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing
plans if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided
by the employee and the obligation can be estimated reliably.
1.13 Provisions
A provision is recognised in the balance sheet when the Group has a present legal or constructive obligation as a result of
a past event, that can be reliably measured and it is probable that an outflow of economic benefits will be required to settle
the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects risks
specific to the liability.
1.14 Revenue recognition
Revenue comprises the fair value of goods sold to external customers, net of value added tax, discounts, rebates, VAT and
other sales taxes or duty. Revenue is recognised on the sale of goods when the significant risks and rewards of ownership
of the goods have passed to the customer and the amount of revenue can be measured reliably, usually on the dispatch
of goods.
1.15 Finance lease payments
Minimum lease payments are apportioned between the finance charge and the reduction of the outstanding liability.
The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest
on the remaining balance of the liability.
www.epwin.co.uk
58
Notes to the Accounts continued
for the year ended 31 December 2014
1.16 Operating lease payments
Payments made under operating leases are recognised in the statement of profit and loss on a straight-line basis over the
term of the lease. Lease incentives received are recognised in the statement of profit and loss as an integral part of the total
lease expense.
1.17 Financial income and expense
Financial expenses comprise interest payable and the unwinding of the discount on provisions. Financial income comprises
interest receivable on funds invested.
Interest income and interest payable is recognised in profit or loss as it accrues, using the effective interest method.
1.18 Taxation
Tax on the profit or loss for the period comprises current and deferred tax. Tax is recognised in the consolidated income
statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable or receivable on the taxable income or loss for the period, using tax rates enacted or
substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous periods.
Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for:
the initial recognition of goodwill; the initial recognition of assets or liabilities that affect neither accounting nor taxable
profit other than in a business combination; and differences relating to investments in subsidiaries to the extent that they
will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner
of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted
at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future profits will be available against which
the temporary difference can be utilised.
Epwin Group Plc Annual Report and Accounts 2014 59
1.19 Non-current assets held for sale and discontinued operations
A non-current asset or a group of assets containing a non-current asset (a disposal group) is classified as held for sale if its
carrying amount will be recovered principally through sale rather than through continuing use, it is available for immediate
sale and sale is highly probable within one year.
On initial classification as held for sale, non-current assets and disposal groups are measured at the lower of previous
carrying amount and fair value less costs to sell with any adjustments taken to profit or loss. The same applies to gains
and losses on subsequent re-measurement although gains are not recognised in excess of any cumulative impairment loss.
Any impairment loss on a disposal group first is allocated to goodwill, and then to remaining assets and liabilities on a pro
rata basis, except that no loss is allocated to inventories, financial assets, deferred tax assets, employee benefit assets and
investment property, which continue to be measured in accordance with the Group’s accounting policies. Intangible assets
and property, plant and equipment once classified as held for sale or distribution are not amortised or depreciated.
A discontinued operation is a component of the Group’s business that represents a separate major line of business or
geographical area of operations that has been disposed of or is held for sale, or is a subsidiary acquired exclusively with
a view to resale. Classification as a discontinued operation occurs upon disposal or when the operation meets the criteria
to be classified as held for sale, if earlier. When an operation is classified as a discontinued operation, the comparative
consolidated income statement is restated as if the operation has been discontinued from the start of the comparative
period.
1.20 Underlying operating profit
Underlying operating profit is a key measure used by management to monitor the underlying performance of the business
and is defined as operating profit before amortisation of acquired intangible fixed assets, business re-organisation costs
and share-based payments.
www.epwin.co.uk 60
Notes to the Accounts continued
for the year ended 31 December 2014
1.21 Adopted IFRS not yet applied
At the date of approval of these financial statements the following standards/improvements have been published and
endorsed by the EU, but have not yet been applied by the Group in these financial statements:
IFRS 2 Share-based payments – definition of ‘vesting condition’;
IFRS 3 Business combinations – classification and measurement of contingent consideration and
scope exclusion for the formation of joint arrangements;
IFRS 8 Operating segments – disclosures on the aggregation of operating segments;
IFRS 13 Fair value measurement – measurement of short-term receivables and payables and scope of
portfolio exception;
IAS 16 Property, plant and equipment & IAS 38 Intangible assets – clarification of restatement of
accumulated depreciation/amortisation on revaluation; and
IAS 24 Related party disclosures – definition of ‘related party’.
Epwin Group Plc Annual Report and Accounts 2014 61
2. Critical judgements and estimations in applying
the Group’s accounting policies
The preparation of the consolidated financial statements requires the directors to make judgements, estimates and
assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses.
The estimates and associated assumptions are based on historical experience and various other factors that are believed
to be reasonable under the circumstances. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised and in any future periods impacted.
The key judgements and estimates employed in the financial statements are considered below.
Impairment of goodwill
On an annual basis, the Group is required to perform an impairment review to assess whether the carrying value of goodwill
is less than its recoverable amount. Recoverable amount is based on a calculation of expected future cash flows, which
include estimates of future performance. Details of assumptions used in the impairment of goodwill are detailed in note 14.
Allowances against the carrying amount of inventories
The Group provides against the carrying amount of inventories based on expected demand for its products to ensure that
inventory is stated at the lower of cost and net realisable value.
Provisions
Provisions are made using the directors’ best estimates of future cash flows based on the current level of information
available to them. Actual cash flows will be dependent on future events. For details of assumptions see note 23.
Deferred taxation
The Group recognises deferred tax assets and liabilities based upon future taxable income and the expected recoverability of
the balance. The estimate will include assumptions regarding future income streams of the Group and the future movement
in corporation tax rates in the respective jurisdictions.
www.epwin.co.uk 62
Notes to the Accounts continued
for the year ended 31 December 2014
3. Segmental reporting
Segmental information is presented in respect of the Group’s reportable operating segments in line with IFRS 8 ‘Operating
Segments’, which requires segmental information to be disclosed on the same basis as it is viewed internally by the Chief
Operating Decision Maker.
Following the IPO, the Group’s Board of Directors, considered as the Chief Operating Decision Makers, reviewed the existing
reportable segments and concluded the Group has two reportable segments based on the operations and products and
services offered; Extrusion, and Fabrication and Distribution.
Reportable segments
Operations
Extrusion
Extrusion and marketing of PVC-U window profile systems, PVC-UE cellular
roofline and cladding, rigid rainwater and drainage products.
Fabrication and Distribution
Fabrication and marketing of windows and doors, distribution of cellular
roofline, cladding, rainwater and drainage products, and manufacture
of glass sealed units.
In arriving at the reportable segments, the existing operating segments of Window Systems and Building Components have
been aggregated as the Extrusion reportable segment.
Distribution operations, previously reported as part of the Building Components division, are now reported in the Fabrication
and Distribution reportable segment along with the fabrication and distribution operations previously reported in Building
Products division.
Epwin Group Plc Annual Report and Accounts 2014
Revenue from external customers
Extrusion - total revenue
Inter - segment revenue
Fabrication and Distribution - total revenue
Inter - segment revenue
63
2013
£m
161.2
(26.4)
134.8
120.6
(0.1)
120.5
2014
£m
170.2
(27.3)
142.9
116.7
(0.1)
116.6
Total revenue from external customers
259.5
255.3
Segmental operating profit
Extrusion
Fabrication and Distribution
Segmental operating profit before corporate and other costs
Corporate and other costs
Underlying operating profit before pre-IPO shareholder management charges
Pre-IPO shareholder management charges
Underlying operating profit
Amortisation of acquired intangible fixed assets
Business re-organisation
Share-based payments
Group operating profit
Net finance costs
Profit before tax
16.6
4.5
21.1
(1.6)
19.5
(1.2)
18.3
(1.7)
3.5
(0.8)
19.3
(0.7)
18.6
11.0
6.1
17.1
(1.6)
15.5
(2.2)
13.3
(1.7)
(2.8)
-
8.8
(1.0)
7.8
www.epwin.co.uk
64
Notes to the Accounts continued
for the year ended 31 December 2014
Balance sheet 2014
Total assets
Total liabilities
Segment assets
Group and other balances
Net assets
Balance sheet 2013
Total assets
Total liabilities
Segment assets
Group and other balances
Net assets
Extrusion
£m
Fabrication and
Distribution
£m
73.1
(34.2)
38.9
37.6
(15.7)
21.9
Extrusion
£m
Fabrication and
Distribution
£m
73.4
(37.5)
35.9
39.9
(20.7)
19.2
Total
£m
110.7
(49.9)
60.8
2.0
62.8
Total
£m
113.3
(58.2)
55.1
(18.5)
36.6
Epwin Group Plc Annual Report and Accounts 2014
Extrusion
£m
3.9
4.2
Extrusion
£m
4.3
4.4
Fabrication and
Distribution
£m
Group and other
costs
£m
2.2
0.8
-
-
Fabrication and
Distribution
£m
Group and other
costs
£m
0.7
1.5
-
-
Other material items 2014
Capital expenditure
Depreciation
Other material items 2013
Capital expenditure
Depreciation
Geographical information
Revenue from external customers
UK
Europe
Rest of World
There are no customers which individually account for more than 10% of the Group’s revenues.
4. Operating profit from continuing operations
Operating profit from continuing operations is stated after charging/(crediting):
Amortisation of acquired intangible assets
Depreciation of property, plant and equipment
Operating lease rentals
65
Total
£m
6.1
5.0
Total
£m
5.0
5.9
2013
£m
240.8
13.5
1.0
255.3
2013
£m
1.7
5.9
8.4
2014
£m
247.0
11.4
1.1
259.5
2014
£m
1.7
5.0
8.9
www.epwin.co.uk
66
Notes to the Accounts continued
for the year ended 31 December 2014
The analysis of auditors’ remuneration is as follows:
Fees payable to the Company’s auditors for the audit of the Company’s annual accounts
The audit of the Company’s subsidiaries pursuant to legislation
Total audit fees
Non-audit fees
Taxation advisory services
Non-audit fees
2014
£m
45
125
170
29
29
199
2013
£m
30
93
123
59
59
182
During the year, professional fees of £1,050,000 were paid to KPMG LLP, by the ultimate shareholders, for services in
relation to the IPO.
5. Acquisition of subsidiaries
Acquisitions in the year ended 31 December 2013
In April 2013, the Group acquired the trade and assets of Crown Architectural Aluminium (UK) Limited. The consideration
of £0.2 million was satisfied in cash. This transaction has been accounted for by the acquisition method of accounting.
Acquiree’s net assets at the acquisition date
Property, plant and equipment
Inventories
Total identifiable assets and liabilities
Cash consideration relating to business combination
Goodwill
Book values
on acquisition
£m
Recognised values
on acquisition
£m
-
-
-
-
-
-
-
-
0.2
0.2
Epwin Group Plc Annual Report and Accounts 2014
67
6. Discontinued operations
As part of the Group’s overall rationalisation project, following the merger in 2012, a number of non-core operations have
been discontinued.
On 2 January 2014 the Group disposed of the trade and assets of Europlas, a non-core retail business. No material gain
or loss arose on disposal. This disposal continues the strategy of rationalisation and focussing on the Group’s core activities
of window profile and cellular roofline extrusion, window and door fabrication and glass sealed unit manufacture. The
comparative consolidated income statement and cash flow statement have been restated to show the discontinued
operation separately from continued operations.
Revenue
Cost of sales
Operating expenses
Loss before tax
Taxation
Loss after tax from discontinued operations
2014
£m
-
-
-
-
-
-
2013
£m
5.0
(4.1)
(0.9)
-
-
-
On 29 August 2014 the Group disposed of the trade and assets of a bespoke, glass distributor based in Portsmouth.
A loss of £0.2 million arose on disposal. The comparative consolidated income statement and cash flow statement have
been restated to show the discontinued operation separately from continued operations.
Revenue
Cost of sales
Operating expenses
Loss before tax
Taxation
Loss after tax from discontinued operations
2014
£m
2.4
(2.0)
(0.7)
(0.3)
-
(0.3)
2013
£m
3.8
(3.1)
(0.8)
(0.1)
-
(0.1)
www.epwin.co.uk
68
Notes to the Accounts continued
for the year ended 31 December 2014
In the year to 31 December 2013, the Group closed its material re-processing business. All employees were made
redundant, the site cleared and the plant and equipment sold.
Revenue
Cost of sales
Operating expenses
Loss before tax
Taxation
Loss after tax from discontinued operations
2014
£m
-
-
-
-
-
-
2013
£m
2.8
(2.8)
(1.8)
(1.8)
0.4
(1.4)
Epwin Group Plc Annual Report and Accounts 2014
69
2013
£m
1.7
2.8
-
4.5
2014
£m
1.7
(3.5)
0.8
(1.0)
7. Non-underlying items
Amortisation of acquired intangible assets
Business re-organisation
Share-based payments
(Income)/expense
Non-underlying items included within operating profit include:
Amortisation of acquired intangible fixed assets
£1.7 million amortisation of brand and customer contract intangibles fixed assets created on the merger in 2012. Customer
contract intangibles are fully amortised at 31 December 2014.
Business re-organisation gains and costs
Business re-organisation gains of £3.5 million (2013: £2.8 million costs) comprise redundancy costs associated with
rationalisation and synergy projects offset by gains made on the favourable settlement of a number of legacy onerous leases.
Site rationalisation and redundancy costs
Gain on closure of non-trading, legacy distribution business
Settlement of legacy onerous lease obligations
2014
£m
(1.2)
2.9
1.8
2013
£m
(2.8)
-
-
3.5
(2.8)
www.epwin.co.uk
70
Notes to the Accounts continued
for the year ended 31 December 2014
Site rationalisation and redundancy costs relate to the re-organisation programme within the Fabrication and Distribution
business. This is now largely completed. In 2013, the site rationalisation and redundancy costs relate to expenditure incurred
on projects to bring about synergistic benefits arising from the Epwin and Latium merger in 2012. They predominantly relate
to severance and site move costs in the Extrusion business.
The closure of a non-trading, legacy distribution business generated a gain of £2.9 million as the business contained certain
property related liabilities which are now no longer due by the Group.
The settlement of onerous lease obligations relates to legacy leases for vacant properties that have subsequently either been
settled for less than the amount provided or an alternative use has been found for the property.
Share-based payments
The share-based payment expense of £0.8 million comprises £0.1 million in respect of the IFRS 2: Share-based payments
charge for the Management Incentive Plan and £0.7 million in respect of share warrants issued as part of the IPO.
Epwin Group Plc Annual Report and Accounts 2014 71
2014
Number
2013
Number
1,718
550
2,268
2014
£m
54.1
4.8
1.3
0.1
60.3
1,707
627
2,334
2013
£m
54.9
5.0
1.2
-
61.1
2014
£m
2013
£m
1.1
0.1
0.1
1.3
0.8
0.1
-
0.9
8. Staff costs
Average number of employees
Production and distribution
Marketing and administration
Aggregate payroll costs
Wages and salaries
Social security costs
Contributions to defined contribution plans
Share based payments
Key management personnel have been identified as the Corporate and Operations Boards.
Remuneration of key management personnel is as follows:
Key management personnel costs
Short-term employee benefits
Post-employment benefits
Share based payment charges
Key management personnel costs exclude management fees paid to related parties for the services of Jim Rawson, Brian
Kennedy and David Challinor of £1.2 million (2013: £2.2 million).
The remuneration of individual Directors is detailed in the Remuneration Report on pages 36 to 39.
www.epwin.co.uk
72
Notes to the Accounts continued
for the year ended 31 December 2014
9. Share based payments
The Group operates the Management Incentive Plan for certain Executive Directors and senior management. The terms of
the Management Incentive Plan are disclosed in the Directors’ Remuneration Report.
Awards issued under the equity based Management Incentive Plan vest three years from the date of the grant based on
certain market and non-market performance criteria being met. Options are settled in equity, the number of shares is
calculated based on the increase in market capitalisation above a specified target.
The number of shares vesting under the Management Incentive Plan is determined as follows:
Following the end of the performance period, the Remuneration Committee will determine whether the applicable
performance targets have been satisfied and calculate the increase in market capitalisation over the target set at grant;
Each award holder will be entitled to shares, with a value equal to a specified percentage of the increase in market
capitalisation over the target, provided that the performance targets have been met – that increase for each award
holder is divided by the market value of a share at the end of the performance period to determine the number of
shares to be awarded.
As the number of shares to be awarded is variable, dependent upon the increase in shareholder value generated, it is
not possible to quantify the number of options awarded.
The fair values for the above options were calculated using the inputs and pricing models outlined in the table below:
Management Incentive Plan
Date of grant
Earliest year in which options are exercisable
Option pricing model used
Aggregate fair value of options granted at date of grant
Expected volatility
Risk free interest rate
Exercise price (per share)
Expected dividend yield
Expected term (years)
Expected departures
Settlement
24 July 2014
2017
Monte Carlo
£1.0 million
35.0%
1.98%
-
6.00%
5 years
-
Equity
Epwin Group Plc Annual Report and Accounts 2014
73
In July 2014 the Group also issued warrants to Zeus Capital for services related to the IPO. The warrant is for 3% of the share
capital of the company at IPO. The warrant is exercisable anytime between the first and tenth anniversary of admission to
AIM. The fair value of the warrant has been determined by reference to the estimated value of services provided using a Black
Scholes valuation model and was charged in full as an IPO expense in the year ended 31 December 2014.
Total expense recognised in the income statement for each of the schemes and disclosed on the face on the income statement
was as follows:
Management Incentive Plan
Share warrants issued as part of IPO
10. Finance costs
Total interest expense on financial liabilities measured at amortised cost
Total finance costs
2014
£m
0.1
0.7
0.8
2014
£m
0.7
0.7
2013
£m
-
-
-
2013
£m
1.0
1.0
www.epwin.co.uk
74
Notes to the Accounts continued
for the year ended 31 December 2014
11. Tax
Current tax expense
Current period
Prior period
Total current tax charge
Deferred tax expense
Current period
Prior period
Total deferred tax charge/(credit)
Tax expense from continuing operations
Tax expense from discontinued operations
Total tax expense
2014
£m
3.4
(0.2)
3.2
(0.4)
0.7
0.3
3.5
-
3.5
UK Corporation tax is calculated at 21.5% (2013: 23.25%) of the estimated assessable profit for the year.
The Group’s total income tax charge is reconciled with the standard rates of UK Corporation tax for the year of 21.5%
(2013: 23.25%) as follows:
Profit before tax
Tax at standard UK corporation tax rate of 21.5% (2013: 23.25%)
Factors affecting the charge for the period:
Expenses not deductible
Non-taxable income
Change in recognised deductible temporary difference
Losses utilised for which no deferred tax previously recognised
Prior period
2014
£m
18.6
4.0
0.4
(0.8)
-
(0.6)
0.5
3.5
2013
£m
1.7
-
1.7
(0.8)
0.4
(0.4)
1.3
(0.4)
0.9
2013
£m
7.8
1.8
0.1
-
(0.4)
(0.6)
0.4
1.3
Epwin Group Plc Annual Report and Accounts 2014
75
Factors that may affect future current and total tax charges
Reductions in the UK corporation tax rate from 26 per cent. to 24 per cent. (effective from 1 April 2012) and to
23 per cent. (effective 1 April 2013) were substantively enacted on 26 March 2012 and 3 July 2012 respectively.
Further reductions to 21 per cent. (effective from 1 April 2014) and 20 per cent. (effective from 1 April 2015) were
substantively enacted on 2 July 2013. This will reduce the Company’s future current tax charge accordingly. The
deferred tax assets at 31 December 2014 have been calculated based on the rate of 20 per cent. substantively
enacted at the balance sheet date (31 December 2013: 20 per cent.).
12. Earnings per share (EPS)
Basic earnings per share are calculated by dividing the profit attributable to ordinary shareholders by the weighted average
number of ordinary shares in issue during the period. The weighted average number of shares has been adjusted for the
issues and cancellations of shares during the period.
Diluted earnings per share are calculated by dividing the profit attributable to ordinary shareholders by the weighted
average number of ordinary shares in issue during the period, plus the dilutive potential ordinary shares arising from share
options in issue at the end of the period.
EPS Summary
Basic earnings per share
Basic earnings per share – continuing operations
Basic earnings per share – discontinued operations
Diluted earnings per share
Diluted earnings per share – continuing operations
Diluted earnings per share – discontinued operations
Number of shares
2014
Pence
11.56
11.76
(0.20)
11.55
11.75
(0.20)
2014
No.
2013
Pence
4.09
5.32
(1.23)
4.09
5.32
(1.23)
2013
No.
(restated)
Weighted average number of ordinary shares (basic)
Effect of share options in issue
128,046,892
68,283
122,330,253
-
Weighted average number of ordinary shares (diluted)
128,115,175
122,330,253
The outstanding awards granted under the Management Incentive Plan are not dilutive as at 31 December 2014 and
therefore are excluded from the diluted EPS calculation.
www.epwin.co.uk
76
Notes to the Accounts continued
for the year ended 31 December 2014
13. Dividends
Previous year final dividend
Current year interim dividend
14. Goodwill
Cost
At 31 December 2012
Acquisitions through business combinations
At 31 December 2013
Acquisitions through business combinations
At 31 December 2014
Accumulated impairment losses
At 31 December 2012, 2013 and 2014
Net book value
At 31 December 2014
At 31 December 2013
At 31 December 2012
Impairment testing
2014
£m
-
1.9
1.9
2014
Pence per
share
-
1.41
1.41
2013
£m
-
-
-
2013
Pence per
share
-
-
-
Goodwill
£m
24.3
0.2
24.5
-
24.5
-
24.5
24.5
24.3
Goodwill of £24.5 million arising on the acquisition of subsidiaries is allocated to the Group’s three cash generating units.
For impairment testing purposes, goodwill has been allocated to cash generating units represented by the Group’s three
divisions. This represents the lowest level within the Group at which goodwill is monitored for internal management
Epwin Group Plc Annual Report and Accounts 2014
77
purposes. At 31 December 2014 and 31 December 2013, £11.7 million of goodwill was allocated to Building Components
Division, £8.7 million to Building Products Division and £4.1 million to Window Systems Division.
Goodwill is not amortised, but tested annually for impairment on the basis of value in use calculations using discounted
cash flows. As the value in use exceeded the carrying value for each of the cash generating units, no impairment loss was
recognised in any of the periods.
In assessing the value in use, the 2015 budget and three year business plan were used to provide cash flow projections to
the period ended 31 December 2017. For periods after 31 December 2017 an annual growth rate of 1.5 per cent. is used to
determine the terminal value.
The cash flow projections are subject to key assumptions in respect of discount rates and achievement of future revenue
and EBITDA growth. The directors have reviewed and approved the assumptions inherent in the model as part of the annual
budget process using historic experience and considering economic and business risks facing the Group.
In assessing the Group’s value in use a pre-tax discount rate of 12.77 per cent. (2013: 10 per cent.) has been applied to the
operating cash flows of the Group’s CGUs.
The calculated value in use exceeded the carrying value of goodwill and neither a 10 per cent. increase in the discount rate
or 10 per cent. decrease in the operating cash flows would result in an impairment.
15. Other intangible assets
Customer Relationships
£m
Brands
£m
Total
£m
Cost
At 31 December 2012, 2013 and 2014
Accumulated amortisation
At 31 December 2012
Charge for the year
At 31 December 2013
Charge for the year
At 31 December 2014
Net book value at 31 December 2014
Net book value at 31 December 2013
Net book value at 31 December 2012
5.0
1.7
1.6
3.3
1.7
5.0
-
1.7
3.3
Amortisation
Amortisation is recognised in administrative expenses in the consolidated income statement:
Customer relationships
Brands
Amortisation
0.3
-
0.1
0.1
-
0.1
0.2
0.2
0.3
2014
£m
1.7
-
1.7
5.3
1.7
1.7
3.4
1.7
5.1
0.2
1.9
3.6
2013
£m
1.6
0.1
1.7
www.epwin.co.uk
78
Notes to the Accounts continued
for the year ended 31 December 2014
16. Investments
The Group’s principal subsidiary undertakings are as follows:
Company name
Principal activity of
the company
Ownership percentage by the
Group as at 31 December 2014
Country of
incorporation
Held directly by
the Company
Specialist Building
Products Limited
Held indirectly by
the Company
Venture Building
Plastics Limited
The extrusion of PVC-U and PVC-UE, the
manufacturer of windows, doors and
conservatories, sealed double glazed units, related
building materials and the trade and public sector
sales of these products
100%
England
Supply of plastic building products
100%
England
CET Glass Processors
(Holdings) Limited
Assembly and supply of insulated
glass units
100%
England
Specialist Building
Distribution Limited
(formerly Shepherds
(UK) Limited)
Indigo Products
Limited
Supply of plastic building products
100%
England
Fabrication of PVC-U products
100%
England
All investments are in the ordinary share capital of the subsidiaries.
All subsidiaries are included in the consolidated results of the Group.
Epwin Group Plc Annual Report and Accounts 2014 17. Property, plant and equipment
Cost
At 31 December 2012
Additions
Disposals
At 31 December 2013
Additions
Disposals
At 31 December 2014
Accumulated depreciation
At 31 December 2012
Charge for the year
Disposals
At 31 December 2013
Charge for the year
Disposals
At 31 December 2014
Leasehold
improvements
£m
Fixtures, fittings
and equipment
£m
Motor vehicles
£m
-
0.1
-
0.1
-
-
0.1
-
-
-
-
-
-
-
30.9
4.9
(0.8)
35.0
6.1
-
41.1
5.2
5.7
(0.6)
10.3
4.8
-
15.1
0.7
-
(0.3)
0.4
-
-
0.4
0.2
0.2
(0.3)
0.1
0.2
-
0.3
79
Total
£m
31.6
5.0
(1.1)
35.5
6.1
-
41.6
5.4
5.9
(0.9)
10.4
5.0
-
15.4
Net book value at 31 December 2014
0.1
26.0
0.1
26.2
Net book value at 31 December 2013
Net book value at 31 December 2012
0.1
-
24.7
25.7
0.3
0.5
25.1
26.2
At 31 December 2014 the net book value of property, plant and equipment held under finance leases was £1.9 million
(2013: £0.7 million). The depreciation charge in respect of these assets was £0.2 million (2013: £0.1 million). The lease
obligations are secured on the leased assets.
www.epwin.co.uk
80
Notes to the Accounts continued
for the year ended 31 December 2014
18. Inventories
Raw materials
Work in progress
Finished goods
2014
£m
9.4
1.2
11.8
22.4
2013
£m
9.2
1.4
11.1
21.7
All inventories are expected to be sold within 12 months.
Inventory purchased in the period recognised as an expense was £120.6 million (2013: £123.1 million).
During the year £0.6 million (2013: £0.5 million) was recognised as an expense in cost of sales in respect of the write down
of inventory to net realisable value.
19. Trade and other receivables
Trade receivables
Less: provision for doubtful trade receivables
Trade receivables net of provision
Prepayments and accrued income
Other debtors
Trade and other receivables
2014
£m
36.9
(2.9)
34.0
2.7
0.9
37.6
2013
£m
39.0
(2.6)
36.4
2.4
1.3
40.1
Epwin Group Plc Annual Report and Accounts 2014
81
2014
£m
2013
£m
2.3
0.3
2014
£m
32.4
4.5
1.9
6.8
45.6
2014
£m
2013
£m
30.9
3.9
6.0
7.1
47.9
2013
£m
-
2.7
20. Cash and cash equivalents
Cash at bank and in hand
21. Trade and other payables
Current
Trade payables
Other taxation and social security
Other payables
Accruals and deferred income
Trade and other payables
Non-current
Other payables
www.epwin.co.uk
82
Notes to the Accounts continued
for the year ended 31 December 2014
22. Other interest bearing loans and borrowings
Non-current liabilities:
Secured bank loans
Finance lease liabilities
Current liabilities:
Secured bank loans
Finance lease liabilities
2014
£m
-
0.8
0.8
-
0.4
0.4
2013
£m
15.6
0.4
16.0
2.8
0.2
3.0
The facilities available to the Group at 31 December 2013 were a £15 million term loan, £5 million overdraft and £20 million
revolving credit facility, secured on the assets of the Group. These facilities were due to expire in January 2017. However,
as part of the flotation on the AIM on 24 July 2014, the Group renegotiated its existing banking facilities with Barclays
agreeing a new £25 million revolving credit facility and £5 million overdraft, secured on the assets of the Group. The term
of the revolving credit facility is for five years ending July 2019.
Borrowing costs of £nil (2013: £0.1 million) are set-off against the amount owing at year end.
The revolving credit facility carried an interest rate of 2.25 per cent. above LIBOR. The margin above LIBOR is dependent
on the level of borrowings.
Epwin Group Plc Annual Report and Accounts 2014
83
Year of
maturity
2014
Face value
£m
2014
Carrying amount
£m
2013
Face value
£m
2013
Carrying amount
£m
Term loan
Revolving credit facility
Revolving credit facility
2017
2017
2019
-
-
-
-
-
-
-
-
8.4
10.0
-
18.4
8.4
10.0
-
18.4
The Group had the following undrawn committed borrowing facilities available at each balance sheet date in respect of
which all conditions precedent have been met:
Expiring between two and five years
Expiring after five years
Finance lease liabilities are payable as follows:
Within one year
In the second to fifth years
2014
£m
30.0
-
30.0
2014
£m
0.4
0.8
1.2
2013
£m
-
10.0
10.0
2013
£m
0.2
0.4
0.6
www.epwin.co.uk
84
Notes to the Accounts continued
for the year ended 31 December 2014
23. Provisions
Leasehold
dilapidations
£m
Warranties
£m
Onerous lease
provisions
£m
At 1 January 2014
Created during the year
Utilised during the year
Released to profit and loss (non-underlying items)
At 31 December 2014
2.6
-
(0.1)
-
2.5
2.0
0.5
(0.5)
-
2.0
5.5
-
(0.7)
(4.8)
-
Non-current
Current
At 31 December 2014
Leasehold
dilapidations
£m
Warranties
£m
Onerous lease
provisions
£m
2.0
0.5
2.5
1.5
0.5
2.0
-
-
-
Total
£m
10.1
0.5
(1.3)
(4.8)
4.5
Total
£m
3.5
1.0
4.5
Epwin Group Plc Annual Report and Accounts 2014
85
Total
£m
10.2
1.2
(1.3)
10.1
Total
£m
7.0
3.1
10.1
Leasehold
dilapidations
£m
Warranties
£m
Onerous lease
provisions
£m
2.8
-
(0.2)
2.6
2.0
0.6
(0.6)
2.0
5.4
0.6
(0.5)
5.5
Leasehold
dilapidations
£m
Warranties
£m
Onerous lease
provisions
£m
1.9
0.7
2.6
1.4
0.6
2.0
3.7
1.8
5.5
At 1 January 2013
Created during the year
Utilised during the year
At 31 December 2013
Non-current
Current
At 31 December 2013
Leasehold dilapidations
Epwin Group leases a number of properties. Under the terms of these leases Epwin Group companies, as tenants, are
required to return the property to its original condition prior to the termination of the lease. Epwin Group provides for the
estimated costs as a contractual obligation exists.
Warranties
Epwin Group companies offer warranties of up to 25 years on certain products. As such, a provision is estimated to cover
the cost of any future replacement and reinstallation on these products.
Onerous lease provisions
The Group leases a number of properties which due to restructuring and re-organisations are now vacant. Where the
likelihood of subletting the properties is considered remote, the Group books a provision for the remaining, committed
rental costs under the terms of the lease. During 2014 the Group settled a number of legacy, onerous property leases
resulting in a credit to the profit and loss account, see note 7.
www.epwin.co.uk
86
Notes to the Accounts continued
for the year ended 31 December 2014
24. Deferred tax
Property plant and equipment
Intangible assets
Trade and other payables
Provisions
Tax value of loss carry-forwards
Deferred tax assets/(liabilities)
Net of deferred tax (liabilities)/assets
Net deferred tax asset
Movement in deferred tax during the periods:
Property plant and equipment
Intangible assets
Trade and other payables
Provisions
Tax value of loss carry-forwards
2014
Assets
£m
-
-
0.2
0.2
4.2
4.6
(1.7)
2.9
2014
Liabilities
£m
2013
Assets
£m
2013
Liabilities
£m
(1.6)
(0.1)
-
-
-
(1.7)
(1.0)
(0.4)
-
-
-
(1.4)
-
-
0.3
0.1
4.2
4.6
(1.4)
3.2
At 1
January
2014
£m
Recognised in
comprehensive
income
£m
At 31
December
2014
£m
(1.0)
(0.4)
0.3
0.1
4.2
3.2
(0.6)
0.3
(0.1)
0.1
-
(0.3)
(1.6)
(0.1)
0.2
0.2
4.2
2.9
Epwin Group Plc Annual Report and Accounts 2014
87
At 1
January
2013
£m
Recognised in
comprehensive
income
£m
At 31
December
2013
£m
Property plant and equipment
Intangible assets
Trade and other payables
Provisions
Tax value of loss carry-forwards
(1.5)
(0.8)
0.4
0.1
4.6
2.8
Deferred tax assets have not been recognised in respect of the following items:
Tax losses
0.5
0.4
(0.1)
-
(0.4)
0.4
2014
£m
17.7
(1.0)
(0.4)
0.3
0.1
4.2
3.2
2013
£m
22.2
As at 31 December 2014, of the potential net deferred tax asset of £6.4 million, the Group has recognised a net deferred
tax asset of £2.9 million. This is because, on reviewing the business forecasts, management has concluded that it is only
probable that future taxable profit will be available to utilise £2.9 million of net deferred tax.
www.epwin.co.uk
88
Notes to the Accounts continued
for the year ended 31 December 2014
25. Share capital and reserves
Allotted and called up:
Ordinary A shares of 1p each
Ordinary A1 shares of 1p each
Ordinary B shares of 1p each
Ordinary B1 shares of 1p each
Ordinary C shares of 1p each
Ordinary shares of 0.05p each
Deferred shares of 1p each
2014
Number of
shares
-
-
-
-
-
135,000,000
1,800,000
2013
Number of
shares
1,620,002
36,818
1,952,809
72,191
1,110
-
-
£
-
-
-
-
-
67,500
18,000
85,500
£
16,200
368
19,528
722
11
-
-
36,829
On 24 July 2014 the Company was admitted to AIM. In preparation for the flotation the following transactions with
shareholders occurred:
On 4 July 2014 the Company capitalised £2.5 million loan notes in exchange for 76,378 ordinary A shares of 1 pence each
and 2,998 ordinary A1 shares of 1 pence each, giving rise to a share premium of £2.5 million.
On 4 July 2014 1,800,000 deferred shares of 1 pence each were issued from the Company’s share premium account. These
deferred shares confer no entitlement to receive notice, attend or vote at any general meeting of the company. The shares
may be redeemed at any time by the company for aggregate proceeds of £1.
On 8 July 2014 the Company made a bonus issue of 300 shares of each existing class of ordinary share for each existing
ordinary share of each class. The total number of shares allotted was 1,128,691,800 resulting in the capitalisation of the
sum of £11.3 million standing to the credit on the Company’s merger reserve.
On 9 July 2014 the Company reduced its share capital by £11.3 million by the way of cancellation of the shares issued by
way of the bonus issue on 8 July 2014.
Epwin Group Plc Annual Report and Accounts 2014
89
On 24 July 2014 the company made the following bonus issues of shares:
0.46160647968 new ordinary A shares for every issued ordinary A share;
0.54736789230 new ordinary A1 shares for every issued ordinary A1 share;
0.58324751678 new ordinary B shares for every issued ordinary B share;
0.70686096605 new ordinary B1 shares for every issued ordinary B1 share;
444 new ordinary C1 shares for every issued ordinary C1 share;
444 new ordinary C2 shares for every issued ordinary C2 share; and
444 new ordinary C3 shares for every issued ordinary C3 share.
Following the bonus issue of shares every issued A ordinary share, A1 ordinary share, B ordinary share, B1 ordinary share,
C1 ordinary share, C2 ordinary share and C3 ordinary share was sub-divided and reclassified as 20 ordinary shares of 0.05
pence each.
On 24 July 2014 the Company placed 10 million ordinary shares of 0.05 pence each for proceeds of £10.0 million as part
of its admission to AIM.
Share premium
The share premium arose on the issue of the Company’s shares at a premium to the nominal value of the shares, less any
expenses of issue incurred in issuing equity.
Merger reserve
The merger reserve arose on the share for share exchange on the acquisition of subsidiaries.
Outstanding options
Outstanding options have been granted to the Directors and Senior Management of the Group under the Management
Incentive Plan. Further details are included within note 9.
Share warrants for 3% of the fully diluted share capital of the company were issued to Zeus Capital for services related
to the IPO. The warrant is exercisable anytime between the first and tenth anniversary of admission to AIM.
www.epwin.co.uk 90
Notes to the Accounts continued
for the year ended 31 December 2014
26. Financial instruments and related disclosures
Financial risk management
The directors have overall responsibility for the oversight of the Group’s risk management framework. A formal process for
reviewing and managing risk in the business has been developed. A register of strategic and operational risk is maintained
and reviewed by the directors, who also monitor the status of agreed actions to mitigate key risks.
Credit risk
Credit risk is the risk of financial loss to the Group if counterparties to a financial instrument fail to meet contractual
obligations, and arises principally from the Group’s receivables from customers.
As the principal business of the Group is credit sales, the Group trade receivables are large and therefore contain exposure
to credit risk. The carrying amount of trade receivables recorded in the financial statements represents the Group’s principal
exposure to credit risk other than cash and cash equivalents held with financial institutions.
The concentration of credit risk for trade receivables at the balance sheet date by geographic region was:
UK
Europe
Credit quality of financial assets and impairment losses
The ageing of trade receivables at the balance sheet date was:
Not past due
Past due 0-30 days
Past due 31-120 days
More than 120 days
2014
Gross
£m
24.9
7.3
2.9
1.8
36.9
2014
Impairment
£m
0.6
0.5
0.4
1.4
2.9
2014
£m
35.4
1.5
36.9
2013
Gross
£m
23.1
10.1
4.7
1.1
39.0
2013
£m
36.9
2.1
39.0
2013
Impairment
£m
0.2
0.1
1.2
1.1
2.6
Epwin Group Plc Annual Report and Accounts 2014
91
2013
£m
4.1
0.6
(2.1)
2.6
The movement in the allowance for impairment in respect of trade receivables during the year was as follows:
Balance at 1 January
Impairment loss recognised
Impairment loss utilised
Balance at 31 December
Liquidity risk
2014
£m
2.6
1.0
(0.7)
2.9
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group ensures
that it has sufficient cash or loan facilities to meet all its commitments when they fall due by ensuring that there are sufficient
cash or working capital facilities to meet the cash requirements of the Group.
The risk is measured by review of forecast liquidity each month to determine whether there are sufficient credit facilities
to meet forecast requirements and by monitoring covenants on a regular basis to ensure there are no expected significant
breaches. Cash flow forecasts are submitted monthly to the directors. These continue to demonstrate the strong cash
generating ability of the business and its ability to operate within existing agreed banking facilities. There have been no
breaches of covenants during the reported periods.
The Group has a £5.0 million overdraft and £25.0 million revolving credit facility to support short and medium term liquidity.
Contractual cash flows
The contractual maturity of other interest-bearing loans and borrowings and other payables agreements is shown below:
Due in less than one year
Expiring between one and two years
Expiring between two and five years
Expiring after five years
Contractual cash flows
Carrying amount
2014
£m
0.4
0.4
0.4
-
1.2
1.2
2013
£m
3.0
2.9
13.1
-
19.0
19.0
It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly
different amounts.
www.epwin.co.uk
92
Notes to the Accounts continued
for the year ended 31 December 2014
Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates, will affect the
Group’s income. The Group’s exposure to market risk predominantly relates to currency risk.
Foreign currency risk
The carrying amount of the Group’s foreign currency denominated monetary assets and monetary liabilities at the
reporting date is as follows:
Foreign currency risk
Trade and other receivables
Cash and cash equivalents
Interest bearing loans and borrowings
Tax payable
Trade and other payables
2014
Euro
£m
1.5
0.5
-
-
(0.3)
1.7
2014
GBP
£m
36.1
1.8
(1.2)
(2.0)
(45.3)
(10.6)
2013
Euro
£m
2.1
-
-
-
(0.4)
1.7
2013
GBP
£m
38.0
0.3
(19.0)
(0.5)
(50.2)
(31.4)
Interest rate risk
The Group’s bank borrowings incur variable interest rate charges linked to LIBOR plus a margin. The Group’s policy aims
to manage the interest cost of the Group within the constraints of its financial covenants and forecasts.
Capital risk management
The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern in order to
optimise returns to its shareholders. The Group views its capital as share capital, bank loans, revolving credit facility,
overdraft and operating cash flow. The Board’s policy is to retain a strong capital base so as to maintain investor, creditor,
and market confidence and to sustain future growth. The directors regularly monitor the level of capital in the Group to
ensure that this can be achieved.
Fair value disclosures
The fair value of each class of financial assets and liabilities is the carrying amount, based on the following assumptions:
Trade receivables, trade payables
and short term borrowings
The fair value approximates to the carrying value because
of the short maturity of these instruments.
Long term borrowings
The fair value of bank loans and other loans approximates
to the carrying value reported in the balance sheet.
Epwin Group Plc Annual Report and Accounts 2014
Fair value hierarchy
Financial instruments carried at fair value should be measured with reference to the following levels:
Level 1: quoted prices in active markets for identical assets or liabilities;
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
At 31 December 2014 and 2013, the Group did not hold any assets or liabilities classified at level 1 or 3 in the fair
value hierarchy.
The fair value of financial assets and liabilities are as follows:
Cash and cash equivalents
Trade and other receivables
Total financial assets
Trade and other payables
Borrowings at amortised cost
Total financial liabilities
2014
£m
2.3
37.6
39.9
2014
£m
45.6
1.2
46.8
93
2013
£m
0.3
40.1
40.4
2013
£m
50.6
19.0
69.6
www.epwin.co.uk
94
Notes to the Accounts continued
for the year ended 31 December 2014
Interest rate sensitivity analysis
The table below shows the Group’s sensitivity to interest rates on floating rate borrowings (i.e. cash and cash equivalents
and bank borrowings which attract interest at floating rates) if interest rates were to change by +/- 1%. The impact on the
result in the statement of profit and loss would be:
2014 Increase/
(decrease) in equity
£m
+1 percentage point movement in interest rates
-1 percentage point movement in interest rates
(0.2)
0.2
2013 Increase/
(decrease) in equity
£m
(0.3)
0.3
Foreign exchange rate sensitivity analysis
The table below shows the Group’s sensitivity to foreign exchange rates for its Euro financial instruments, the major
non-sterling currency in which the Group’s receivables are denominated:
2014 Increase/
(decrease) in equity
£m
+10 percentage points appreciation of the Euro
-10 percentage points depreciation of the Euro
0.4
(0.3)
2013 Increase/
(decrease) in equity
£m
0.4
(0.3)
A strengthening/weakening of sterling, as indicated, against the Euro at each period end would have increased/(decreased)
the profit and loss by the amounts shown above. This analysis is based on foreign currency exchange rate variances that the
Group considered to be reasonably possible at the end of the reporting period. The analysis assumes that all other variables,
in particular interest rates, remain constant.
Epwin Group Plc Annual Report and Accounts 2014
27. Commitments
Non-cancellable operating lease rentals are payable as follows:
Less than one year
Between one and five years
More than five years
Land and buildings
2014
£m
Land and buildings
2013
£m
4.7
15.5
33.6
53.8
5.8
17.0
20.6
43.4
Other
2014
£m
2.7
5.1
0.1
7.9
95
Other
2013
£m
1.1
3.6
-
4.7
28. Related party transactions
During the year the Group leased properties at a market rent of £0.8 million (2013: £2.2 million) from entities in which Mr.
A J Rawson (shareholder and former director) has a beneficial interest.
During the year the Group also paid management fees to entities in which Mr. A J Rawson has a beneficial interest, the net
cost of which was £0.5 million (2013: £0.7 million).
The amount outstanding to entities in which Mr. A J Rawson has a beneficial interest at 31 December 2014 was £nil (2013:
£0.7 million).
During the year the Group also paid rentals and management fees to entities in which Mr. B G Kennedy has a beneficial
interest, the net cost of which was £1.6 million (2013: £2.7 million).
The amount owed to the Group by entities in which Mr. B G Kennedy has a beneficial interest at 31 December 2014 was
£0.3 million (2013: £0.2 million).
All transactions with Directors are included in the Directors’ Remuneration Report on pages 36 to 39.
www.epwin.co.uk
96
Company Balance Sheet
for the year ended 31 December 2014
Fixed Assets
Investments in subsidiaries
Current assets
Debtors - included in debtors is £19.4m (2013: 24.8m)
falling due after more than one year
Creditors:
Amounts falling due within one year
Net current assets
Total assets less current liabilities
Creditors:
Amounts falling due after more than one year
Amounts falling due after more than one year
Net assets
Equity
Ordinary share capital
Share premium
Merger reserve
Profit and loss
Equity shareholders’ funds
Note
3
4
5
6
7
8
8
8
2014
£m
27.9
27.9
20.8
20.8
(9.0)
11.8
39.7
-
-
2013
£m
27.8
27.8
25.6
25.6
(13.9)
11.7
39.5
(15.6)
(15.6)
39.7
23.9
0.1
12.5
15.7
11.4
39.7
-
-
27.0
(3.1)
23.9
The financial statements were approved by the Board of Directors and authorised for issue on 15 April 2015.
They were signed on its behalf by:
Jonathan Bednall
Chief Executive Officer
Christopher Empson
Group Finance Director
Company number:
07742256
Epwin Group Plc Annual Report and Accounts 2014
97
Notes to the Company Accounts
for the year ended 31 December 2014
The following accounting policies have been applied consistently in dealing with items which are considered material in
relation to the Company’s financial statements.
1. Basis of preparation
Epwin Group Plc (the “Company”) is a company incorporated and domiciled in the United Kingdom.
The financial statements of the parent company have been prepared in accordance with United Kingdom Generally
Accepted Accounting Practice (“UK GAAP”), and under the historical cost accounting rules.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in
these financial statements.
Under Section 408 of the Companies Act 2006, the Company is exempt from the requirement to present its own profit and
loss account and related notes.
Going concern
As highlighted in note 26 of the Group’s financial statements, the Group meets its day to day working capital requirements
through an overdraft and revolving credit facility which is due for renewal in July 2019.
Further information on the Group’s business activities, together with the factors likely to affect its future development,
performance and position is set out in the Strategic Report on pages 10 to 19. Further information on the financial position
of the Group, its cash flow, liquidity position and borrowing facilities is described in this review.
In addition, note 26 to the Group’s financial statements includes the Group’s objectives, policies and processes for managing
its capital and its exposures to credit risk and liquidity risk.
The Group’s forecasts and projections, taking account of reasonably possible changes in trading performance, show that the
Group should be able to operate within the level of its current facility.
After making enquiries, the Board has a reasonable expectation that the Company and the Group has adequate resources to
continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in
preparing the annual report and accounts.
Investments
Investments in subsidiary undertakings are stated at cost less any provision for impairment where in the opinion of the
directors there has been a diminution in the value of the investment.
Operating leases
Rentals payable under operating leases are recognised in the profit and loss account on a straight line basis over the periods
of the leases.
www.epwin.co.uk 98
Notes to the Company Accounts continued
for the year ended 31 December 2014
Bank borrowings and financing costs
Interest-bearing bank loans and overdrafts are stated at the amount of the proceeds received, net of financing costs, where
the intention is to hold the debt instrument to maturity. Financing costs are amortised over the expected term of the loan so
as to produce a constant rate of return over the period to the date of expected redemption.
Share based payments
The Company operates an equity settled Management Incentive Plan and has issued share warrants as part of the IPO.
Where the Company grants options over its own shares to the employees of its subsidiaries it recognises, in its individual
financial statements, an increase in the cost of investment in its subsidiaries equivalent to the equity-settled share-based
payment charge recognised in its consolidated financial statements with the corresponding credit being recognised directly
in equity.
The fair value of the warrants is recognised as an expense with a corresponding increase in equity.
The fair value of both the share options and warrants is measured at grant date using an option pricing model, taking into
account the terms and conditions upon which the options were granted.
Taxation
The charge for taxation is based on the profit / (loss) for the year and takes into account taxation deferred because of timing
differences between the treatment of certain items for taxation and accounting purposes.
2. Staff costs
Please see disclosure in note 8 of the consolidated financial statements.
Disclosure of individual Directors’ remuneration is included in the Remuneration Report on pages 36 to 39.
Epwin Group Plc Annual Report and Accounts 2014 3. Fixed asset investments
Cost
At 1 January 2014
Additions
At 31 December 2014
Impairment
At 1 January 2014 and 31 December 2014
Net book value
At 31 December 2014
At 31 December 2013
99
Shares in subsidiary
undertakings
£m
27.8
0.1
27.9
-
27.9
27.8
Fixed asset investments represent holdings in the ordinary share capital of wholly owned subsidiaries. Details of the
subsidiaries is provided in note 16 to the Group financial statements.
4. Debtors
Amounts falling due within one year
2014
£m
2013
£m
Amounts due from subsidiary undertakings
1.4
0.8
Amounts falling due after more than one year
2014
£m
2013
£m
Amounts due from subsidiary undertakings
19.4
24.8
www.epwin.co.uk
100
Notes to the Company Accounts continued
for the year ended 31 December 2014
5. Creditors amounts falling due within one year
Bank loans and overdraft
Amounts owed to subsidiary undertakings
Other creditors
2014
£m
9.0
-
-
9.0
2013
£m
13.8
-
0.1
13.9
6. Creditors amounts falling due after more than one year
2014
£m
2013
£m
Bank loans and other borrowings
-
15.6
Analysis of bank loans and borrowings:
Repayable:
Within one year
Between one and two years
Between two and five years
2014
£m
9.0
-
-
9.0
2013
£m
13.8
2.8
12.8
29.4
The terms of the bank loans and borrowings are disclosed in the consolidated accounts in note 22.
Epwin Group Plc Annual Report and Accounts 2014
101
Total
£m
23.9
-
23.9
2.5
(11.3)
11.3
10.0
(1.9)
0.8
4.3
39.6
7. Share capital
The movement in share capital is disclosed in note 25 to the consolidated financial statements.
8. Reserves
At 1 January 2014
Restatement
At 1 January 2014 (restated)
Shares issued prior to IPO
Bonus issue of shares
Cancellation of shares
Shares issued as part of IPO
Dividends paid
Share based payments
Retained profit for the year
Retained profit for the year
Share premium account
£m
Merger reserve
£m
Profit and loss
£m
12.0
(12.0)
-
2.5
-
-
10.0
-
-
-
12.5
15.0
12.0
27.0
-
(11.3)
-
-
-
-
-
15.7
(3.1)
-
(3.1)
-
-
11.3
-
(1.9)
0.8
4.3
11.4
The movements in reserves are explained in note 25 to the consolidated financial statements.
The restatement of reserves as at 1 January 2014 relates to a classification correction from share premium
account to a merger reserve.
www.epwin.co.uk
102
Epwin Group Plc Annual Report and Accounts 2014 103
Notice of AGM
www.epwin.co.uk 104
Notice of Annual General Meeting
Explanatory Notes to the Resolutions
Notice is hereby given that the Annual General Meeting of Epwin Group Plc (“the Company”) will be held at Eversheds LLP,
115 Colmore Row, Birmingham, West Midlands, B3 3AL on Tuesday 26 May 2015 at 11.00am for the following purposes:
Ordinary business
To consider, and if thought fit, pass the following resolutions which will be proposed as ordinary resolutions:
1.
To receive and adopt the Company’s annual accounts for the year ended 31 December 2014, together with the report
of the Directors and the auditors on those accounts.
2.
3.
4.
5.
6.
7.
8.
9.
To declare a final dividend of 2.83 pence per ordinary share in respect of the financial year ended 31 December 2014.
To re-appoint KPMG LLP as auditors of the Company, to hold office from the conclusion of this meeting until the
conclusion of the next general meeting at which accounts are laid before the Company.
To authorise the Directors to determine the remuneration of the auditors of the Company.
To re-elect Jonathan Bednall as a director of the Company.
To re-elect Christopher Empson as a director of the Company.
To re-elect Shaun Hanrahan as a director of the Company.
To re-elect Andrew Eastgate as a director of the Company.
To re-elect Michael O’Leary as a director of the Company.
Special business
As special business, to consider and if thought fit pass the following resolutions which will be proposed as to resolution
10 as an ordinary resolution and as to resolutions 11, 12 and 13 as special resolutions:
10. That in accordance with section 551 of the Companies Act 2006, the Directors be generally and unconditionally
authorised to allot shares in the Company and to grant rights to subscribe for or to convert any security into shares
in the Company:
(a) comprising equity securities (as defined by section 560(1) of the Companies Act 2006) up to an aggregate nominal
amount of £45,000 (such amount to be reduced by the nominal amount of any equity securities (within the
meaning of section 560 of the said Act) allotted pursuant to the authority in paragraph (b) below) in connection
with an offer by way of a rights issue:
(i)
to holders of ordinary shares in proportion (as nearly as may be practicable) to their respective holdings; and
(ii) to holders of other equity securities as required by the rights of those securities or as the Directors consider
necessary but subject to exclusions or other arrangements as the Directors may deem necessary or expedient
in relation to treasury shares, fractional entitlements, record dates, legal or practical problems in or under the
laws of any territory or the requirements of any regulatory body or exchange; and
(b) in any other case, up to a nominal amount of £22,500 (such amount to be reduced by the nominal amount of
any equity securities allotted pursuant to the authority in paragraph (a) above in excess of £22,500.
Epwin Group Plc Annual Report and Accounts 2014
105
Such authorities shall apply until the close of business on 30 June 2016 or, if earlier, the end of the next Annual General
Meeting of the Company, unless previously varied or revoked by the Company in general meeting, save that, in each case,
the Company may make offers or agreements which would or might require shares to be allotted or rights to subscribe for
or convert securities into shares to be granted after the authority ends and the Directors may allot shares or grant rights to
subscribe for or convert securities into shares in pursuance of any such offer or agreement as if the authority had not ended.
11. That, subject to the passing of resolution 10, pursuant to Section 570 of the Companies Act 2006 (“the Act”) the
Directors be and are hereby unconditionally empowered to allot equity securities (within the meaning of Section 560
of the Act) for cash pursuant to the authority conferred by resolution 10 as if Section 561(1) of the Act did not apply
to such allotment, provided that such power shall be limited to:
(a) the allotment of equity securities in connection with an offer (whether by way of a rights issue, open offer or
otherwise) to holders of ordinary shares in the capital of the Company in proportion (as nearly as practicable) to
the respective numbers of ordinary shares held by them, subject to such exclusions or other arrangements as the
Directors may deem necessary or expedient to deal with equity securities representing fractional entitlements or
any legal or practical problems under the laws of any territory or the requirements of any regulatory body or stock
exchange, and
(b) the allotment of equity securities for cash (otherwise than pursuant to paragraph (a) above) up to an aggregate
nominal amount of £3,375,
and (unless previously revoked, varied or renewed) shall expire on 30 June 2016 or at the conclusion of the next annual
general meeting of the Company after the passing of this resolution, whichever is the earlier, save that the Company may
make an offer or agreement before the expiry of this power which would or might require equity securities to be allotted for
cash after such expiry and the Directors may allot equity securities for cash pursuant to any such offer or agreement as if the
power conferred by this resolution had not expired.
12. That the terms of both:
(a) a contract proposed to be made between the Company and Jim Rawson for the purchase by the Company of
990,000 deferred shares of £0.01 each in the capital of the Company for a total consideration of £0.55 as set
out in the contract produced to the meeting and signed by the chairperson of the meeting for the purposes of
identification (the “First Purchase Contract”); and
(b) a contract proposed to be made between the Company and Brian Kennedy for the purchase by the Company of
810,000 deferred shares of £0.01 each in the capital of the Company for a total consideration of £0.45 as set
out in the contract produced to the meeting and signed by the chairperson of the meeting for the purposes of
identification (the “Second Purchase Contract”),
be approved and the Company be authorised to enter into the First Purchase Contract and the Second Purchase Contract.
www.epwin.co.uk
106
Notice of Annual General Meeting
Explanatory Notes to the Resolutions
13. That pursuant to Section 701 of the Companies Act 2006 (“the Act”), the Company be and is generally and
unconditionally authorised to make market purchases (within the meaning of Section 693(4) of the Act) of
ordinary shares of 0.05 pence each in the capital of the Company (“Shares”), provided that:
(a) the maximum number of Shares which may be purchased is 6,750,000;
(b) the minimum price (exclusive of expenses) that may be paid for a share is 0.05 pence;
(c) the maximum price (exclusive of expenses) which may be paid for a Share is an amount equal to the higher
of: (i) 105 per cent of the average of the middle market quotations for the Shares as derived from the Daily
Official List for the five business days immediately preceding the day on which the purchase is made; and (ii)
an amount equal to the higher of the price of the last independent trade of an ordinary share and the highest
current independent bid for an ordinary share as derived from the London Stock Exchange Trading System;
(d) unless previously revoked, varied or renewed, this authority shall expire on 30 June 2016 or at the conclusion
of the next annual general meeting of the Company, whichever is the earlier; and
(e) the Company may enter into a contract to purchase Shares before the expiry of this authority under which
such purchase will or may be completed or executed wholly or partly after such expiry and may make a
purchase of Shares pursuant to any such contract as if the authority conferred by this resolution had not
expired.
By Order of the Board
Christopher Empson
Company Secretary
15 April 2015
Company Number: 07742256
Registered Office
1b Stratford Court
Cranmore Boulevard
Solihull
B90 4QT
Epwin Group Plc Annual Report and Accounts 2014
107
Ordinary Business
Resolutions 1 to 10 will be proposed as ordinary resolutions, and will be passed if more than 50 per cent of shareholders’
votes cast are in favour.
Resolution 1: To receive the 2014 Report and Accounts
The directors of the Company (“the Directors”) must present their annual report and accounts of the Company for the year
ended 31 December 2014 (the “Annual Report”) to shareholders for formal adoption at the Annual General Meeting.
Resolution 2: To declare a final dividend
A final dividend of 2.83 pence per ordinary share is proposed. An interim dividend of 1.41 pence per ordinary share was
paid during the year. If approved, the final dividend will be paid on 8 June 2015 to shareholders on the register at the close
of business on 15 May 2015.
Resolutions 3 and 4: To reappoint the auditors and authorise the Board to determine their remuneration
The Company is required to appoint auditors at each general meeting at which accounts are laid before the Company,
to hold office until the conclusion of the next such meeting. The Audit Committee has reviewed the effectiveness,
independence and objectivity of the external auditors, KPMG LLP, on behalf of the Board.
Following the Audit Committee’s review of the effectiveness of the external auditor referred to above, the Board has
decided to put KPMG LLP forward to be appointed as auditors. Resolution 4 also authorises the Directors, in accordance
with standard practice, to negotiate and agree the remuneration of the auditors.
Resolution 5 to 9: To appoint Directors
At each annual general meeting the following directors will retire from office and be eligible for re-election:
(a) any Directors who have been appointed by the Directors since the last annual general meeting; and
(b) any Director who was not elected or re-elected at either of the two preceding annual general meetings.
Jonathan Bednall, Christopher Empson, Shaun Hanrahan, Andrew Eastgate and Michael O’Leary, will retire and seek election
at this year’s AGM. Biographies for each Director appear on page 30 of the Annual Report.
www.epwin.co.uk
108
Notice of Annual General Meeting
Explanatory Notes to the Resolutions
Special business
As well as the ordinary business of the meeting outlined above, special matters will be dealt with at the Annual General
Meeting. Resolution 10 will be proposed as an ordinary resolution and resolutions 11, 12 and 13 will be proposed as special
resolutions. For these resolutions to be passed, more than 75 per cent of shareholders’ votes cast must be in favour.
Resolution 10: Directors’ authority to allot shares
This resolution would give the Directors authority to allot ordinary shares, and grant rights to subscribe for or convert any
security into shares in the Company, up to an aggregate nominal value of £22,500. This amount represents one third of
the issued ordinary share capital of the Company as at 15 April 2015, the last practicable date prior to the publication of
this document. The resolution would also give the Directors authority to allot equity securities up to an aggregate nominal
amount of £45,000.
The Directors have no present intention to allot new shares other than in connection with employee share and incentive
plans.
Resolution 11: Disapplication of pre-emption rights
If directors of a company wish to allot shares in the company for cash (other than in connection with an employee share
scheme) company law requires that these shares are offered first to shareholders in proportion to their existing holdings.
The purpose of Resolution 11 is to authorise the Directors to allot ordinary shares in the Company for cash (i) in connection
with a rights issue; and, otherwise, (ii) up to a nominal value of £3,375, equivalent to five per cent of the total issued
ordinary share capital of the Company as at 15 April 2015 without the shares first being offered to existing shareholders
in proportion to their existing holdings. This level of authority is required in order to give the Company flexibility in the
event of acquisition opportunities and major shareholders will be consulted in advance of the authority being exercised
Resolution 12: Buyback of deferred shares
This resolution seeks authority for the Company to make off market purchases of its own deferred shares and is proposed
as a special resolution. If passed, the resolution gives authority for the Company to purchase 1,800,000 of its deferred
shares under two separate purchase agreements, representing 100 per cent of the Company’s issued deferred share capital
as at 15 April 2015.
The resolution is proposed in order that clarity be brought to the Company’s share capital position. The directors currently
intend to cancel all shares purchased under this authority.
The buyback for an aggregate sum of £1.00 is based on the existing provisions of the Company’s articles of association.
Resolution 13: Authority to purchase own shares
Under the Companies Act 2006 (“the Act”), the Company requires authorisation from shareholders if it wishes to purchase
its own shares.
Resolution 13 specifies the maximum number of shares that may be purchased (5% of the Company’s issued share capital)
and the highest and lowest prices at which they may be bought.
Epwin Group Plc Annual Report and Accounts 2014
109
Under the Act, the Company can hold the shares which have been repurchased as treasury shares and either resell them
for cash, cancel them, either immediately or at a point in the future, or use them for the purposes of its employee shares
schemes. The Directors believe that it is desirable for the Company to have this choice and therefore intend to hold any
shares purchased pursuant to this authority as treasury shares. Holding the repurchased shares as treasury shares will give
the Company the ability to re-sell or transfer them in the future, and so provide the Company with additional flexibility
in the management of its capital base. However, in order to respond properly to the Company’s capital requirements and
prevailing market conditions, the Directors will need to reassess at the time of any actual purchase, whether to hold the
shares in treasury or cancel them.
The Directors have no present intention of exercising this authority. The Directors intend to keep under review the
Company’s potential to buy back its shares, taking into account other investment and funding opportunities. The authority
will only be used if in the opinion of the Directors this will result in an increase in earnings per share or would otherwise be
in the best interests of shareholders generally.
Entitlement to appoint proxies
1. Members are entitled to appoint a proxy to exercise all or any of their rights to attend and to speak and vote on their
behalf at the meeting. A proxy need not be a shareholder of the company.
2. A shareholder may appoint more than one proxy in relation to the meeting provided that each proxy is appointed to
exercise the rights attached to a different share or shares held by the shareholder. To appoint more than one proxy, you
should contact the Company’s registrars, Capita Asset Services, on 0871 664 0300 (calls cost 10 pence per minute plus
network extras, lines are open 8:30 am to 5:30 pm Monday to Friday) or on +44 208 639 3399 (if calling from outside
the UK), for further forms of proxy, or photocopy this form of proxy as required. Please ensure that, for each proxy
appointed in this way, you fill in, alongside the proxy’s details, the number of shares in respect of which each proxy is
appointed.
3. Shareholders who return the form(s) of proxy will still be able to attend the meeting, speak and vote in person if they so
wish. Shareholders or their duly appointed proxies are requested to bring proof of identity with them to the meeting in
order to confirm their identity for security reasons. A shareholder may only appoint a proxy or proxies:
(a) In hard copy form (together with any power of attorney or other written authority under which it is signed or a copy
of such authority notarially certified or certified in some other way by the Directors) by post, courier or by hand to
the offices of the Company’s registrars, CapitaAsset Services, PXS, 34 Beckenham Road, Beckenham BR3 4TU, or
(b) In the case of CREST members, by utilising the CREST electronic proxy appointment service in accordance with the
procedures set out below.
Appointing Proxies
4. A shareholder wishing to appoint a proxy should complete the accompanying form(s) of proxy and return it/them to
the Company’s registrars, Capita Asset Services, PXS, 34 Beckenham Road, Beckenham BR3 4TU. Alternatively, you
may submit your proxy electronically by using the CREST proxy service.
www.epwin.co.uk
110
Notice of Annual General Meeting
Explanatory Notes to the Resolutions
Electronic proxy appointment through CREST
5. CREST members who wish to appoint a proxy or proxies by utilising the CREST electronic proxy appointment service may
do so by utilising the procedures described in the CREST Manual. CREST personal members or other CREST sponsored
members, and those CREST members who have appointed a voting service provider(s), should refer to their CREST
sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf.
6. In order for a proxy appointment made by means of CREST to be valid, the appropriate CREST message (a ‘CREST Proxy
Instruction’) must be properly authenticated in accordance with Euroclear UK & Ireland Limited (‘EUI’) specifications and
must contain the information required for such instructions, as described in the CREST Manual. The message, regardless
of whether it relates to the appointment of a proxy or to an amendment to the instructions given to a previously
appointed proxy must, in order to be valid, be transmitted so as to be received by the issuer’s agent (ID RA10) by noon
on 22nd May 2015. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp
applied to the message by the CREST Applications Host) from which the issuer’s agent is able to retrieve the message by
enquiry to CREST in the manner prescribed by CREST. After this time, any change of instructions to proxies appointed
through CREST should be communicated to the appointee through other means.
7. CREST members and, where applicable, their CREST sponsors or voting service provider(s) should note that EUI does
not make available special procedures in CREST for any particular messages. Normal system timings and limitations
will therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member
concerned to take (or, if the CREST member is a CREST personal member or sponsored member or has appointed a
voting service provider(s), to procure that his CREST sponsor or voting service provider(s) take(s)) such action as shall
be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this
connection, CREST members and, where applicable, their CREST sponsors or voting service provider(s) are referred, in
particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.
8. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the
Un-certificated Securities Regulations 2001.
Joint holders
9. In the case of joint holdings, only one holder may sign and the vote of the senior who tenders a vote shall be accepted
to the exclusion of the votes of the other joint holders, seniority for this purpose being determined by the order in which
the names stand on the register of members in respect of joint holdings.
Entitlement to attend and vote
10. In accordance with Regulation 41 of the Un-certificated Securities Regulations 2001, only those members registered
in the register of members of the Company as at close of business on 22 May 2015 or, in the event the meeting is
adjourned, in the register of members 48 hours before the time of any adjourned meeting shall be entitled to attend
or vote at the meeting in respect of the number of shares registered in their name at the time. Changes to entries
in the register of members after close of business on 22 May 2015 or, in the event of the meeting being adjourned,
after 48 hours before the time of any adjourned meeting shall be disregarded in determining the rights of any person
to attend or vote at the meeting.
Epwin Group Plc Annual Report and Accounts 2014 111
Corporate Representatives
11. Any corporation which is a member can appoint one or more corporate representatives who may exercise on
its behalf all of its powers as a member provided that they do not do so in relation to the same shares.
Voting Rights
12. As at 15 April 2015 (being the last business day prior to the publication of this Notice), the Company’s issued share
capital consists of 135,000,000 ordinary shares, carrying one vote each and 1,800,000 deferred shares with no
entitlement to vote. Therefore, the total voting rights in the Company as at 15 April 2015 are 135,000,000.
Communicating with the Company in relation to the AGM
13. Except as provided above, shareholders wishing to communicate with the Company in relation to the AGM should
write to the Company Secretary, Epwin Group Plc, 1b Stratford Court, Cranmore Boulevard, Solihull, B90 4QT.
14. You may not use any electronic address provided either in this Notice or any related documents, to communicate
with the Company for any purposes other than those expressly stated.
Inspection of documents
15. Copies of the Executive Directors’ service contracts and Non-executive Directors’ letters of appointment will
be available for inspection during normal business hours at the offices of Epwin Group Plc, 1b Stratford Court,
Cranmore Boulevard, Solihull, B90 4QT (excluding weekends and public holidays). They will also be available
for inspection at the place of the annual general meeting from 10.45 a.m. on the day of the meeting until the
conclusion of the meeting.
Voting Results
16. The results of the voting at the AGM will be announced through a Regulatory Information Service and will appear
on our website www.epwin.co.uk.
Data Protection Statement
17. Your personal data includes all data provided by you, or on your behalf, which relates to you as a shareholder,
including your name and contact details, the votes you cast and your Shareholder Reference Number (attributed
to you by the Company). The Company determines the purposes for which and the manner in which your
personal data is to be processed. The Company and any third party to whom it discloses the data (including the
Company’s registrars) may process your personal data for the purposes of compiling, fulfilling its legal obligations
and processing the shareholder rights you exercise.
www.epwin.co.uk Epwin Group Plc
1b Stratford Court
Solihull
B90 4QT
T: 0121 746 3700
E: info@epwin.co.uk
www.epwin.co.uk
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