FW Thorpe Plc

FW Thorpe Plc

Merse Road 
North Moons Moat 
Redditch 
Worcestershire 
B98 9HH 
England

Tel: +44 (0)1527 583200 
Fax: +44 (0)1527 584177

Incorporating 
Thorlux Lighting 
Compact Lighting 
Philip Payne 
Sugg Lighting 
Solite Europe 
Portland Lighting 
TRT Lighting

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Annual Report and Accounts 2012

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FInancIal calendar

2012

19 October

Posting of the Annual Report and Accounts

15 November

Annual General Meeting

22 November

Payment of final dividend

2013

March

May

Announcement of interim results

Payment of interim dividend

September

Announcement of results for the year

FW Thorpe Plc 
annual report and accounts 2012

Business review
IntrOdUctIOn

We specialise in designing and 
manufacturing professional lighting 
equipment. We currently employ 
approximately 470 people and 
although each company works 
autonomously, our skills and markets 
are complementary. Our focus is 
for long-term growth and stability 
achieved by developing market 
leading products backed by excellent 
customer service.

Our products are sold throughout 
the world. The group management 
team is passionate about developing 
the business for the benefit of 
the shareholders, employees and 
customers. With the energy and 
ability of our staff we look forward 
to the future with enthusiasm. Our 
aim is to create shareholder value 
through market leadership in the 
design, manufacture and supply 
of professional lighting systems. 

In this report

Business review

01  How we have performed
02  FW Thorpe Plc at a glance
04  Our geographic reach
05  Chairman’s statement
08  New LED product ranges
10  TRT Lighting
12  Portland Lighting
14  Carbon offsetting project

Governance

Accounts

Additional information

16  Directors
17  Advisers and Company information
18  Report of the directors
22  Directors’ remuneration report
25  Statement of directors’ responsibilities
26  Independent auditors’ report

65  Notice of meeting
67  Shareholder notes
IBC Financial calendar

27  Consolidated income statement
28   Consolidated statement 

of comprehensive income
29   Consolidated and company 

balance sheets

30  Consolidated statement
of changes in equity

31   Company statements of changes 

in equity

32  Consolidated and Company
statements of cash flows
33  Notes to the consolidated
financial statements

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to access further content. 

Or visit: 
www.fwthorpe.co.uk

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This material used in the publication of this document is carbon balanced.

Printed on FSC certified paper.

This document is printed on material manufactured at a mill which is ISO14001 accredited.

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Business Review
How we HAve peRfoRmed

Turnover
£m

+5%

Operating profit
£m

+5%

2008

2009

2010

2011

2012

42.5

44.6

47.0

52.8

55.6

2008

2009

2010

2011

2012

8.8

9.5

10.6

11.3

11.9

Earnings per share
Pence
(continuing operations)

+18%

Dividend per share
Pence

+10%

2008

2009

2010

2011

2012

61.9

63.8

66.1

71.8

84.8

2008

2009

2010

2011

2012

13.9

16.2

16.7

17.6

19.4

operational highlights

–– –Strong–export–performance,–47%–increase–to–£7.8m
–– –Investment–in–new–LED–street–lighting–division–– TRT Lighting
–– Successful–integration–of–Portland–Lighting
–– –Continued–investment–in–LED–products–across–the group

FW Thorpe Plc
Annual Report and Accounts 2012

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02

FW Thorpe Plc 
Annual Report and Accounts 2012

Business Review
fw THoRpe AT A GlAnce

Thorlux lighting

The–Thorlux–range–of–luminaires–is designed,–
manufactured–and distributed–by–Thorlux–Lighting,–
a division–of–FW Thorpe–Plc.

Thorlux–luminaires–have–been–manufactured–
continuously–since–1936,–the–year–Frederick–William–
Thorpe–founded–the company.

The–company–now–operates–from–the–group’s–
modern–14,410–square–metre–self-contained–factory–
in–Redditch,–Worcestershire,–central–England. 

compact lighting

Compact–manufactures–and–supplies–professional–
lighting–systems–to–retailers.–Its–focus–on this–market–
enables–it–to–produce–cost-effective–products–
designed–specifically–for–today’s–retail–environment.

Its–aim–is–to–enable–retailers–to–design–and–test–new–
lighting–concepts,–control–their–implementation–
and manage–the–roll-out–to–a–budget.–Compact–
employs–both–lighting–and project–management–
professionals–and–already–supplies–lighting–to–many–
of the UK’s–top–100–retailers.

philip payne

Philip–Payne–recognises–that–most–trade emergency–
exit–signage–products–are–generally–designed–
with the–functional–in mind.

Philip–Payne–offers–a–backbone–range of quality–
standard–products–but–more importantly–encourage–
direct–dialogue–with architects–and–designers–
to ensure–via–product–variation–or–bespoke–work–
aesthetic–aspirations–and–requirements–are–fully met.

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FW Thorpe Plc
Annual Report and Accounts 2012

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sugg lighting

Established–in–1837,–Sugg–Lighting–is renowned–
as the–leading–name–in decorative–and heritage–
lighting.

Ornate–Sugg–Lighting–columns–and decorative–
lanterns–are–in–use–throughout–the–world,–with–many–
nineteenth–century–installations–still in excellent–
working–order.

The–historic–skills–and–traditions–behind this–unique–
pedigree–remain–the–cornerstone–of–the–Sugg–
Lighting–success–story.

solite europe

Solite–Europe–is–a–leading–manufacturer–and–supplier–
of–cleanroom–lighting–equipment–and luminaires–
within–the–UK–and Europe.

It–provides–luminaires–for–laboratories,–
pharmaceutical–and semi-conductor–manufacturing–
areas–including–hospitals,–kitchens–and–food–
preparation–applications.

portland lighting

Portland–Lighting–design,–manufacture–and–supply–
innovative–lighting–products–to–the–brewery,–retail–
and–sign–lighting–industries.

The–company–operates–from–a–modern–1,300–square–
metre–facility–in–Walsall–that–was–purposely–designed–
to–enable–the–fast–turnaround–of–customer–orders.–

Established–in–1994,–the–product–range–has–
continually–evolved–to–ensure–that–Portland–remains–
one–of–the–leading–companies–in–their–sector.

*using your smartphone, scan this code to access further content, or visit: www.fwthorpe.co.uk

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04

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

Business	Review
OuR	geOgRAphic	ReAch

We focus on long-term growth and stability, achieved by developing market leading 
products, backed by excellent customer service.
We operate as separate companies and although each company works autonomously, 
our skills and markets are complementary.

united	Kingdom

Thorlux Lighting 
TRT Lighting 
Redditch

Philip Payne 
Solihull

Solite Europe 
Manchester

Sugg Lighting 
Horsham

Compact Lighting 
Portsmouth

Portland Lighting 
Walsall

germany

Thorlux Lighting 
Munich

ireland

Thorlux Lighting 
Dublin

Australia

Thorlux Lighting Australasia 
Melbourne

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Business Review
cHAiRmAn’s sTATemenT

FW Thorpe Plc
Annual Report and Accounts 2012

05

5%–is,–however,–5%–and–marks–another–
group record–operating–profit.

Investment–in–the–group–has–continued–
during–the–year–and–has–centred–around–
four majors,–being–the–installation–of–the–
£1m sheet–metal–laser–punching–machine–at–
Thorlux,–the–purchase–of–a–new–1,000–square–
metre–factory,–the–starting–of–a–new–venture,–
TRT–Lighting,–and–the–purchase–of–Portland–
Lighting–Ltd–in–Walsall,–West–Midlands.–
More detail–will–be–given–on–these–
investments–later–in–the–report.

Export–sales–excluding–the–previous–sizeable–
contribution–from–Mackwell–Electronics–Ltd–
increased–47%–during–the–financial–year–in–
question.–Thorlux–contributed–a–42%–increase–
with–notable–“one–off”–order–contributions–
from–Solite–Europe–Ltd–and–Compact–
Lighting–Ltd.

The–financial–performance–outlined–at–the–
beginning–of–this–report–allows–your–Board–
to recommend–a–final–dividend–of–14.6p–per–
share–(2011:–13.3p)–which–together–with–the–
interim–dividend–paid–in–April–2012–makes–
a total–dividend–for–the–year–of–19.4p–
(2011: 17.6p)–an–increase–of–10%.

The–financial–year–ended–30–June–2012–
provided–your–company–with–revenue–
of £55.6m–being–an–increase–on–the–
corresponding–period–of–5%.–Operating–profit–
increased–to–£11.9m–which–combined–with–an–
increase–in–net–financial–income–resulted–in–a–
group–profit–before–tax–expense–of–£12.7m,–
up–9%–compared–to–the–2010/2011–figure.

The–above–represents–the–results–of–our–
continuing–operations–and–excludes–the–
profit–on–sale–of–Mackwell–Electronics–Ltd–and–
any–contribution–prior–to–the–business–leaving–
the–group–in–December–2011.

A–5%–rise–in–operating–profit–is–perhaps–
not what–some–commentators–may–have–
expected–looking–at–our–half–year–figures.–
Times–are–strange,–however,–and–some–of–
our subsidiaries–as–well–as–our–largest–firm,–
Thorlux,–experienced–a–noticeable–downturn–
in–orders–during–May–and–June–2012,–the–two–
final–months–of–our–financial–year–and–those–
which–normally–provide–the–“fruit–on–the–
sideboard”–in–the–way–of–a–good–finale–to–
the year.

The–reasons–for–this–occurrence–are–not–clear–
especially–as–the–first–two–months–of–the–new–
financial–year,–July–and–August,–have–seen–
trading–for–those–companies–affected,–return–
to–the–levels–of–last–year.–Indeed,–the–recently–
published–UK–Manufacturing–Purchasing–
Managers–Index–which–had–been–falling––
in–recent–months,–showed–a–sharp–rise–in–
August–and–somewhat–correlates–with–our–
experiences.–Elements–within–the–group––
have–also–reported–a–notable–slowdown–in–
business–from–the–areas–affected–by–the–
Olympic–Games.

A B Thorpe 
Chairman

“ 5% is, however, 5% and 
marks another group 
record operating profit.”

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06

FW Thorpe Plc 
Annual Report and Accounts 2012

Business Review
cHAiRmAn’s sTATemenT conTinued

“ Continuing investment in 
design and introduction 
of new products, the bulk 
of which are for the LED 
light source”

Thorlux Lighting

Industrial–and–commercial–lighting–systems–
maker,–Thorlux,–entered–the–financial–year–
with–a–healthy–backlog–of–orders.–This–and–
ongoing–business–resulted–in–a–busy–first––
half–after–which,–however,–orders–slowed–
marginally–followed–by–a–dip–in–May–and–June–
2012.–This–phenomenon–within–the–group–
was–most–noticed–at–Thorlux–which,–as–
mentioned–earlier,–is–now–trading–at–levels–
akin–to–last–year.

Notwithstanding–the–continuing–investment–
in–design–and–introduction–of–new–products,–
the–bulk–of–which–are–for–the–LED–light–source,–
the–main–investment–at–Thorlux–has–been–the–
actual–installation–of–the–£1m–sheet–metal–
laser–cutting–and–punching–machine.–
The machine–which–takes–up–a–similar–space–
as–a–single–tennis–court,–punches–holes–in–
sheet–metal–to–the–shape–of–the–individual–
tool–selected–for–the–particular–punching–
stroke.–This–part–of–the–operation–is–the–same–
as–with–other–existing–similar–machines–
at Thorlux,–except–that–it–is–much–quicker.–
The laser–cutting–function–allows–the–cutting–
of–shapes–in–the–sheet–metal–without–the–
need–for–expensive–tooling;–this–latter–
function–means–that–sheet–metal–blanks–
with complicated–profiles–can–be–produced–
on–a–“one–stop–shop”–basis–on–this–machine.–
In addition–a–finished–component–picking–
and–stacking–facility–negates–the–need–for–
manual–separation–and–stacking–of–
finished profiles.

The–year–2010/11–severely–strained–current–
manufacturing–capacity–and–so–to–free–
further–manufacturing–space–in–the–required–
areas,–Thorlux–will–be–building–a–new–2,400–
square–metre–high–roof–warehouse–on–
existing–spare–land–adjacent–to–the–main–
factory.–The–new–facility–will–house–some–90%–
more–finished–goods–per–square–metre–than–
the–current–facility–and–be–equipped–with–
more–appropriate–product–picking–
equipment–than–currently–installed.–

The–export–effort–continues–with–an–increase–
of–42%–on–last–year.–Virtually–all–areas–have–
performed–well–with–a–caveat–that–our–office–
in–Munich–though–not–contributing–an–
increase–this–year,–has–substantially–modified–
its–sales–platform–to–one–which–we–are–
confident–will–provide–noticeable–growth–
in the–coming–financial–year.–

Compact Lighting Ltd

Compact–Lighting,–our–Portsmouth–retail–
and display–lighting–company,–has–seen–a–flat–
year–as–the–sector–as–a–whole–has–not–been–
buoyant.–New–sales–staff–brought–in–due–to–
the–retirement–of–a–successful–long–running–
Sales–Manager–last–year–and–the–imminent–
retirement–of–another–have–not–produced–
the required–results.–A–new–high–calibre–Sales–
Director–has,–therefore,–just–been–engaged–
with–a–view–to–improving–the–situation.–

Compact–is–continuing–to–follow–the–group–
directive–to–increase–its–already–now–
significant–range–of–tooled–display–lighting–
luminaires.–These–highly–tooled–ranges–of–
product–have–played–an–important–role–in–
Compact–specification–lighting–during–the–
last–financial–year–and–they–will–be–at–the–
forefront–of–our–improved–sales–initiative.–

Philip Payne Ltd

Philip–Payne–Ltd,–the–group’s–manufacturer–
of specification–exit–signage,–experienced–
a patchy–year–struggling–to–match–last–year’s–
volumes–and,–no–doubt,–suffering–from–the–
general–reduction–in–construction–activity.–
Saying–this,–Payne–still–managed–to–present–
a profit–to–sales–ratio–which–would–be–
considered–most–satisfactory–for–many–
organisations.–

Notable–projects–supplied–during–the–year–
include–the–provision–of–exit–signage–for–the–
Jacobean–Theatre–at–the–Globe–complex–and–
exit–lighting–for–the–shell–and–core–areas–of–
the Shard–in–London.

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Annual Report and Accounts 2012

07

Sugg Lighting Ltd

TRT Lighting

The future

Heritage–lighting–maker–and–refurbisher,–
Sugg,–endured–another–fairly–stand-still–year–
in–financial–performance–terms–despite–
producing,–again,–some–fine–quality–work–
such–as–the–manufacture–and–supply–of–
exterior–lighting–for–the–Bomber–Command–
Memorial–which–included–a–series–of–special–
lanterns–mounted–on–bespoke–eight–metre–
columns.

A–proportion–of–Sugg’s–product–offering–is–
the–supply–of–complete–heritage–lanterns–of–
traditional–but–fairly–standard–patterns–and–
in this–sector–of–the–market–there–are–a–
number–of–small–similar–“family-style”–firms–
producing–similar–products–and–whose–
existence–continues–mainly–due–to–their–
small and–parochial–make–up.–

It–is–hard–for–Sugg–to–compete–in–this–sector–
and–make–the–required–profit,–and–there–is,–
therefore,–a–current–project–of–“blue–sky”–
thinking–in–regard–to–Sugg–Lighting–and–its–
forward–strategy.

Solite Europe Ltd

A–specialist–in–“clean–room”–lighting,–Solite,–
performed–well–in–its–first–year–with–new–
Managing–Director–Mr–Phil–Myles.–

Solite,–as–with–Compact–Lighting,–has–been–
lacking–the–market–penetration–deserved–
of its–product–range–and–expertise–and–I–can–
report–that,–at–this–time,–a–new–Sales–Director–
with–a–deal–of–successful–clean–room–lighting–
experience–has–just–been–appointed.

Portland Lighting Ltd

Portland,–a–specialist–in–external–sign–lighting,–
joined–the–group–as–stated–earlier–in–July–2011,–
and–so–may–I–take–this–opportunity–to–
officially–welcome–Portland–and–Managing–
Director–Mr–Andy–Truelove–and–his–team–to–
the–group.–The–change–of–ownership–does–
not–seem–to–have–dampened–enthusiasm–
at Portland–and,–I–am–pleased–to–report,–that–
they–have–put–Thorlux,–for–once,–in–number–
two–slot–in–regard–to–operational–profit–to–
sales–ratio!–

Portland,–which–is–based–in–Walsall,–West–
Midlands,–makes–lights–for–signs–and,–though–
you–may–not–know–it–you–will–be–seeing–their–
products–most–days.

Initially–a–division–of–Thorlux,–TRT–has–been–
established–to–concentrate–on–the–design,–
manufacture–and–supply–of–LED–outdoor–
lighting–systems.–It–is–currently–in–its–one–year–
design–and–establishment–phase.–Thorlux–has–
in–recent–years–successfully–concentrated–
on commercial–indoor–lighting–systems–
somewhat–to–the–detriment–of–its–outdoor–
offering–and–the–complexity–of–modern–
lighting–renders–it–hard–for–one–company–to–
concentrate–100%–on–very–many–aspects–at–
the–same–time.–

The–inauguration–of–TRT–will–not–only–allow–
100%–group–concentration–on–both–areas–
of lighting–but–also–a–move–into–LED–street–
lighting,–an–area–new–to–the–group,–and–one–
which–is–no–longer–in–the–commodity–sector–
due–to–the–shift–over–to–LED–light–sources–
for these–applications.–

The–almost–new–factory–purchased–for–
around–£0.75m–is–close–to–the–group–HQ–in–
Redditch–and–has–been–purchased–on–a–
999 year–lease,–a–period–which–is–considered–
sufficient–by–the–current–management.

Carbon Offsetting Project

The–FW–Thorpe–Plc–Carbon–Offsetting–Project–
at–Devauden–in–Monmouthshire–has now–
35,000–trees–planted.–Ahead–of–the schedule–
required–for–group–carbon–offsetting–but–as–
required–to–take–advantage–of–grants–
available–from–the–Forestry–Commission–
Wales.–In–November–2011–the–company–was–
awarded–the–accolade–of–being–the–first–
company–to–be–successfully–assessed–to–the–
“Woodland–Carbon–Code”–of– Wales.

A–press–day–was–held–on–site–during–which–
a “celebration–tree”–was–planted–by–Welsh–
Minister–of–Environment–and–Sustainability,–
Mr–John–Griffiths;–Mr–Jon–Owen–Jones–of–
Forestry–Commission–Wales,–and–FW–Thorpe–
Plc–Joint–Managing–Director,–Mr–Mike–Allcock.

People

Once–again–I–would–like–to–thank–all–those–
within–FW–Thorpe–Plc–for–their–loyalty–and–
hard–work–throughout–this–slightly–up–and–
down–year.–I–am–pleased–that–the–company–
has–once–again–been–able–to–supply–a–stable–
work-place–and–I–would–like–to–express–my–
appreciation–for–the–most–cooperative–
attitude–shown–by–so–many–and–which–
makes–heading–the–group–a–pleasure.

In–lighting–terms–the–future–now–definitely–
includes–LED–for–general–lighting–
applications.–The–amount–of–light–output–
from–an–LED–per–watt–of–electricity–can–now–
match–or–even–surpass–more–traditional–light–
sources–such–as–high–intensity–discharge–
or fluorescent–lamps.–That–is–not–to–say,–
however,–that–an–LED–lighting–solution–
should–be–the–only–consideration,–as–the–
“fluorescent–boys”–have–not–been–asleep–
to the–challenge.–Fifty–thousand–hour–
fluorescent–lamps–are–now–available–at–
reasonable–prices–and–these–match–the–life–
expectancy–of–an–LED–product.

LED–technology–is–currently–expensive–and–
although–this–will–change,–conventional–
technology–may–still–give–a–better–economic–
outcome–when–considering–initial–cost,–
energy–savings,–longevity–and–ease–of–
maintenance.

The–new–technology–has–created–an–entry–
point–for–many–new–small–start-up–
companies–and–some–users–are–being–
tempted–by–the–“pot–of–gold”–in–energy–
savings–that–are–possible–using–LED–products.–
Unfortunately–the–temptation–of–the–“pot–of–
gold”–often–clouds–the–judgement–in–regard–
to–the–selection–of–a–quality–supplier.–

Behind–an–LED–product–there–are–electronic–
circuits–which–have–to–be–designed–properly,–
circuit–boards–which–have–to–be–made–
properly,–LED–chips–which–have–to–be–placed–
and–cooled–properly–otherwise–failures–will–
be–frequent–and–a–great–deal–more–costly–to–
put–right–than–with–conventional–technology.–

Your–company–has–availed–itself–of–the–
expertise–in–all–these–areas–and–sees–no–
long-term–threat–from–these–new–starters.

The–rest–just–depends–on–our–ability–to–sell–
and–a–reasonable–market–prevailing.

A B Thorpe 
Chairman
20–September–2012

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New–LED––
product–ranges

Advanced LED Luminaire Technology

In–the–last–six–months,–LEDs–have–developed–
significantly–and–sometimes–exceed–the–
performance–of–the–best–fluorescent–
solutions.–Volume–increases–have–reduced–
costs,–making–LEDs–the–ideal–choice–in–many–
more–applications.

Not–all–LED–solutions–are–the–same,–however,–
and–not–all–will–provide–customers–with–long–
lasting,–efficient–installations–often–promised–
by–some–competitors.–Thorlux–has–invested–
heavily–in–technology–to–be–at–the–forefront–
of the–industry,–providing–excellent–technical–
lighting–solutions.–Thorlux–designs,–
manufacturers–and–tests–the–vast–majority–
of its–own–LED–electronic–circuits–and–lenses–
––the–latter–for–precise–optical–control.

The–company’s–76-year–history,–running–into–
thousands–of–years–of–combined–experience,–
ensures–every–aspect–of–lighting–a–space–is–
carefully–considered–––a–requirement–all–the–
more–important–as–system–lifetimes–are–now–
expected–to–reach–50,000–to–100,000–hours–
or even–more.–Thorlux–carefully–considers–
end-of-life–scenarios–––for–example–LED–
failures,–solder–joint–failures–and–isolated–
component–failures–––to–ensure–new–designs–
have–on-going–system–reliability–even–when–
individual–components–fail.

Solow–LED

In–2011/2012–Thorlux–launched–more–new–
products–than–ever–before.–Late–in–2012–the–
company–will–launch–a–significant–number–
of new–products,–several–with–patents–
applied–for,–and–all–LED–based.–Thorlux–
expects–to–see–significant–growth–in–LED–
luminaire–sales–in–2013.

Group–technical–capabilities–will–drive–
increasing–LED–market–penetration–
and increased–revenue–potential–whilst–
presenting–a–serious–technical–challenge–
to others–in–the–marketplace.

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lighting–applications.–They–can–be–switched–
on–and–off–without–the–warm-up–time–
associated–with–conventional–discharge–light–
sources,–and–can–be–dimmed–to–save–energy.–
The LED luminaires–use–approximately–half–
of–the–energy–required–for–an–equivalent–
fluorescent–scheme.–

Initial–monitoring–studies–conducted–during–
September–2012–indicate–that–the–installation–
will–provide–savings–of–approximately–80%–
compared–with–LED–luminaires–remaining–
on at–full–brightness–all–night.

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Luminaires go to full output 
when movement is detected

Background Security Lighting
from dusk until dawn

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Smart External Monitored Installation

The–car–park–lighting–at–FW–Thorpe’s–head–
office–in–Redditch–has–been–upgraded–to–
demonstrate–the–savings–that–can–be–made–
by–using–the–latest–in–lighting–technology–––
a Smart–External–control–system–with–Realta–
LED–luminaires.

Smart–External–is–an–innovative–control–
system–developed–specifically–for–use–with–
external–LED–lighting.–It–utilises–the–instant–
switching–and–dimming–capability–of–LEDs–
to–produce–substantial–energy–savings.–
The system–is–configured–so–that–the–
luminaires–in the–office–car–park–switch–on–

at–a–low–output–level–at–dusk–and–remain–on–
at–that–level–until–dawn–to–provide–security–
lighting.–If a person–drives–or–walks–into–the–
car–park,–the–luminaires–go–to–full–output–then–
dim–down–again–five–minutes–after–the–last–
movement–detection.–This–is–a–convenient–
feature–for–early–starters–and–those–working–
late,–and–it–also–deters–intruders.–

Realta–LED–luminaires–have–been–installed–
to–reduce–energy–consumption,–improve–
the–lighting–level–and–improve–the–quality–
of–light,–providing–better–security.–LEDs–offer–
very–long–life–and–are–ideally–suited–to–exterior–

Luminaires go to full output 
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TRT Lighting

TRT–(Thorlux–Road–and–Tunnel)–Lighting,–
an independent–specialist–division–which–has–
evolved–from–Thorlux–Lighting,–is–the–latest–
venture–within–the–FW–Thorpe–Plc–group.–

Building–on–76–years–of–lighting–experience,–
TRT–is–dedicated–to–the–design,–manufacture–
and–supply–of–LED–road–and–tunnel–
luminaires.–The–target–for–TRT–is–to–produce–
quality,–efficient,–stylish,–high–performance–
LED–products–that–are–manufactured–in–
the UK.

Historically,–Thorlux–supplied–products–to–
many–major–road–tunnel–projects–within–
the UK–and–the–Far–East,–with–a–global–
supply in–excess–of–30,000–luminaires.–
With this–specialist–knowledge,–TRT–can–
provide–unique–tunnel–lighting–and–control–
systems–using–the–Scanlight–DALI–based–
lighting–control–system.–

The–group–has–invested–in–a–new–facility,–
a few–miles–from–Thorlux’s–main–
manufacturing–site,–to–enable–TRT–to–
concentrate–on–the–fast-track–development–
of–new–products–and–control–systems–for–
the road–and–tunnel–lighting–market.–

TRT–is–developing–a–range–of–LED-based–
road-lighting–luminaires–for–residential–
S-lighting-class–and–up–to–ME3-lighting-class–
roads.–The–products–take–full–advantage–
of LED–technology–by–providing–instant–
white–light,–reduced–running–costs–and–long–
lifetimes,–promoting–minimum–maintenance.–
Additional–road–lighting–controls,–via–some–
of the–latest–command–and–monitoring–
systems–(CMSs),–will–provide–enhanced–user–
benefits–such–as–lamp–failure–feedback–and–
operational–statistics,–while–optimising–
energy–usage–and–reducing–the–carbon–
footprint.

The–new–TRT–premises,–currently–being–
used for–the–initial–design–and–development–
phase,–will–shortly–be–furnished–with–an–
interactive–showroom–facility–and–a–
production–capability.

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Factory

The–1,000–square–metre–factory–is–close–to–
the group’s–main–manufacturing–unit–and–
head–office.

The–relatively–new–building–will–enable–the–
factory–layout–to–be–effective–and–efficient.–

Tunnel Luminaires

A–very–successful–range,–adopted–from–that–of–
Thorlux–Lighting,–provides–extensive–product–
lifetimes–and–exceptionally–high–performance–
for–the–most–challenging–environments.

TRT–has–introduced–LED–variations–of–existing–
luminaires.–Also,–a–new–product,–designed–
with–LED–technology–at–the–core,–will–soon–
be launched.

LED Road Luminaires

A–range–of–road–luminaires–targeted–at–
specific–road–classes–is–in–the–later–stages–
of development.–

Products–embrace–LED–technology–and–
use two–head–sizes–and–numerous–optical–
arrays–and–power–ratings.–All–accommodate–
the–latest–CMS-based–wireless–
communication–systems.–

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Annual Report and Accounts 2012

Portland Lighting

Established–in–1994,–Portland–Lighting–is–
among–the–leading–brands–in–the–external–
sign–lighting–industry.–Portland–has–
differentiated–itself–by–providing–excellent–
customer–service–and–continuing–
enthusiastically–to–embrace–ever-changing–
technology.

Together–with–fluorescent–options,–Portland–
offers–a–range–of–fully–CE-compliant–sign–
lighting–for–all–budgets–and–every–installation.–
The–advent–of–LED–technology,–which–has–
reduced–energy–consumption–and–enhanced–
life–expectancy,–has–given–Portland–the–
opportunity–to–enhance–its–product–range.–
(For–many–years,–advertising–billboards,–
hoardings–and–shop–fronts–have–been–
illuminated–using–conventional–tungsten–
or fluorescent–light–sources.)–The–LED–Ecolux–
trough–light,–with–its–specialist–lens,–now–
generates–30%–of–revenue.–Portland–also–
offer a–range–of–floodlights–for–signs,–and–
its Uni–Bracket–System–for–trough–lighting–
provides–a–solution–to–all–fixing–situations.

Affiliation–to–FW–Thorpe–Plc–gives–Portland–
access–to–the–development–resources–and–
expertise–of–the–group–and–affords–new–and–
greater–opportunities–to–improve–the–
product–portfolio.–After–a–successful–first–year,–
Portland–looks–to–develop–its–LED–product–
range–further–and–improve–its–export–
business.

Portland–designs–and–manufactures–all–
products–in–a–purpose-built–facility–in–Walsall,–
from–where–products–are–distributed.–
Portland’s–modern–manufacturing–
techniques–and–in-house–powder-coating–
plant–enable–a–fast–turnaround–for–standard–
and–special–colour–variations.–Raw–materials–
are–held–in–stock–and,–following–a–customer’s–
order,–products–can–be–cut–to–length–and–
powder–coated–to–meet–special–needs,–
and then–assembled–and–despatched.

Customers–are–from–a–variety–of–business–
sectors–including–retail,–brewing,–advertising–
and–commercial.–Projects–often–include–
rebranding–an–entire–estate–portfolio.–Last–
year’s–acquisition–of–Tote–by–Betfred–gave–
Portland–the–opportunity–to–help–rebrand–
many–of–Tote’s–500–high–street–outlets.

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Factory

Portland’s–1,300–square–metre–factory–
is located–near–the–motorway–network–
in Walsall,–West–Midlands.

The–purpose-built–facility–includes–
an automated–powder-coating–plant.

Key Products

•  –LED–and–fluorescent–trough–lights–for–signs–

and–billboards–of–various–dimensions

•  –Traditional–bullet-style–lights–and–menu–

cases–for–the–hospitality–sector

•  –Decorative–lanterns–and–globe–lights,–

as well–as–a–range–of–brackets

Ecolux

Key features:
•  –Latest–high–power–chip–technology–gives–

85–lumens–per–watt–output

•  Over–1,000–lumens–per–metre–of–LED–output

•  –Only–12.5–watts–per–metre–power–

consumption;–energy–saving–of–75%–
compared–with–fluorescent

•  IP67–rating;–50,000–hours–or–more–of–lamp–life

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Annual Report and Accounts 2012

The–first–site–in–Wales–to–
be–certified–against–the–
Woodland–Carbon–Code

FW–Thorpe–is–committed–to–minimising–the–environmental–impact–of–both–its–manufacturing–
processes–and–its–products.–However,–even–with–the–most–responsible–approach,–some–carbon–
dioxide–(CO2)–will–be–released–into–the–atmosphere–as–an–indirect–result–of–factory–and selling–
activities–and–customers’–use–of–luminaires.–In–2009,–FW–Thorpe–designed–an–ambitious–
carbon-offsetting–scheme–to–help–compensate–for–these–emissions.

MONMOUTH

WOLVESNEWTON

Oak,–Sweet–Chestnut,–Beech

Alder,–Ash

Ash,–Field–Maple

Oak,–Ash,–Hazel

European–Larch,–Ash

Douglas–Fir,–Ash

River

Path

Road

B4293

MONMOUTH

WOLVESNEWTON

DEVAUDEN

B4293

CHEPSTOW

DEVAUDEN

CHEPSTOW

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The–project–has–been–designed–and–is–
managed–by–a–silviculturalist–(an–expert–
in the development–and–management–of–
forests).–The–woodland–has–the–backing–
of the–Forestry–Commission–Wales–and–is–
the first–site–in–Wales–to–meet–the–Woodland–
Carbon–Code,–a–voluntary–standard–for–
woodland–creation–projects–in–the–UK–
to monitor–and–assess–claims–about–the–
CO2 sequestered.

www.forestry.gov.uk/carboncode

FW–Thorpe–has–chosen–to–plant–trees.–
Why trees?–Trees–and–other–plants–absorb–
CO2 during–photosynthesis.–One–tree–
grown to–maturity–in–open–space–can–
absorb approximately–1–tonne–of–CO2–over–
its lifetime.–A–forest–covering–many–acres–
can effectively–lock–up–CO2,–creating–a–
carbon sink.

On–215–acres–of–land–in–Cwm–Fagor,–near–
Devauden–in–Monmouthshire,–FW–Thorpe–
plans–to–plant–enough–trees–to–offset–group–
emissions–each–year.–Between–2009–and–2012,–
a–total–of–35,000–trees–have–been–planted.–

Native–broadleaf–species–will–maximise–the–
potential–of–the–site–and–link–up–adjoining–
ancient–woodlands,–improving–the–local–
environment.–Sustainable–forest–
management–will–ensure–that–the–trees–thrive–
and–are–harvested–at–appropriate–times–to–be–
used–in–wood-related–products,–ensuring–that–
the–carbon–is–held–within–the–wood–well–past–
the–lifetime–of–the–tree.

left: Jon–Owen–Jones–––(Forestry–commission’s–
Commissioner–for–Wales),–middle:–John–Griffiths–
(Minister–for–Environment–and–Sustainable–
Development),–Right:–Mike–Allcock–––(Managing–
Director–of–Thorlux–Lighting).

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Annual Report and Accounts 2012

GoveRnAnce
diRecToRs

mike Allcock 
Joint Group chief executive 
and managing director, 
Thorlux lighting 

Mike–joined–FW–Thorpe–Plc–in–1984–as–an–
apprentice,–working–his–way–to–Technical–
Director–for–Thorlux–Lighting–in–1998,–
taking–responsibility–for–the–company’s–
design–programme.–He–was–appointed–
Group–Technical–Director–in–2001,–
Managing–Director–of–Thorlux–Lighting–
in 2003–and–Joint–Group–Chief–Executive–
in 2010.–Mike–is–a–Chartered–Electrical–
Engineer–and–a–Fellow–of–the–Institution–
of Engineering–and–Technology.–He is–
passionate–about–developing–innovative,–
high–technology,–market–leading–
products.

Tony cooper
manufacturing director, 
Thorlux lighting 

Tony–graduated–from–Loughborough–
University–with–a–B.Tech–in–Production–
Engineering–and–Management–in–1984–
and became–a–Chartered–Engineer–in–
1988. He–worked–in–various–manufacturing–
industries,–including–Mars–Electronics–and–
Thomas–&–Betts,–before–joining–Thorlux–
Lighting–as–Manufacturing–Director–
in 1998.

Andrew Thorpe
chairman and  
Joint Group chief executive 

Andrew–is–the–grandson–of–the–company–
founder,–Frederick–William–Thorpe.–
After serving–an–apprenticeship–with–the–
company,–he–has–worked–in–various–parts–
of–the–business,–leading–to–the–positions–
of Export–Sales–Director,–Manufacturing–
Director–and–then–Managing–Director–of–
Thorlux–Lighting.–In–2000,–he–became–
Joint Group–Chief–Executive–and–in–2003–
Group–Chairman.

craig muncaster
financial director and  
company secretary 

After–graduating–in–Business–
Administration,–Craig–qualified–as–a–
Chartered–Management–Accountant–
in 2000.–He–has–spent–time–in–the–
manufacturing–and–engineering–sectors,–
more–recently–as–UK–Financial–Director–for–
Durr,–which–included–a–number–of–
overseas–ventures–and–projects–for–the–
wider–group.

david Taylor 
managing director, philip payne

David–joined–FW–Thorpe–Plc–in–1978–
and on–completion–of–a–commercial–
apprenticeship–leading–to–an–HNC–in–
Business–Studies–he–worked–in–various–
roles–at–Thorlux–Lighting–and–elsewhere–
within–the–group.–In–1996,–he became–
Managing–Director–of–Philip–Payne–Limited.

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peter mason 
non-executive director 

After–studying–Electrical–Engineering–at–
Aberdeen–University,–Peter–qualified–
as a Chartered–Accountant–with–Price–
Waterhouse–in–1976.–He–spent–time–with–
Planet–Group–and–TI–Group–before–joining–
FW–Thorpe–Group–in–1987–as–Finance–
Director.–He–became–Joint–Chief–Executive–
in–July–2000.–He–became–a non-executive–
director–in–June–2010,–and is the–Chairman–
of–the–remuneration–committee.

ian Thorpe
non-executive director

Ian,–grandson–of–the–company–founder,–
was–Manufacturing–Director–of–Thorlux–
Lighting–from–1978–until–1993–when–he–
became–Personnel–Director.–He–became–a–
non-executive–director–on–1–October–1997–
and–is–a member–of–the–remuneration–
committee.

colin Brangwin 
non-executive director 

After–joining–the–company–in–1963,–Colin–
was appointed–a–director–in–1969,–later–
as joint Managing–Director–and–in–1995–
was appointed Chairman.–He–became––
non-executive–Chairman–in–2000–
resigning from this–role–on–30–June–2003.

Nominated Adviser
n+1 Brewin
12–Smithfield–Street,
London–EC1A–9BD

Registrars
equiniti
Aspect–House,–Spencer–Road,
Lancing–BN99–6DA

company information

Registered Office
Merse–Road,–North–Moons–Moat,
Redditch,–Worcestershire––
B98–9HH

Registered No.
F–W–Thorpe–Plc–is–registered–in–
England and Wales–No.–317886

Advisers

Auditors
pricewaterhousecoopers llp
Cornwall–Court,–
19 Cornwall Street,
Birmingham–B3–2DT

Bankers
lloyds TsB
Church–Green–East,–Redditch,
Worcestershire–B98–8BZ

Solicitors
martineau
No–1–Colmore–Square,
Birmingham–B4–6AA

Websites
www.fwthorpe.co.uk
www.thorlux.com
www.thorluxdesign.com
www.thorlux.com.au
www.thorlux.de
www.thorlux.ie
www.thorlux.es
www.thorlux.se
www.compact-lighting.co.uk
www.philippayne.co.uk
www.solite-europe.com
www.sugglighting.co.uk
www.portlandlighting.co.uk
www.trtlighting.co.uk

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18

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

GOVERNANCE 
REPORT OF THE DIRECTORS 

GOVERNANCE 

The directors have the pleasure in submitting their annual report 
and the audited consolidated financial statements of the group 
and the company for the year ended 30 June 2012. 

Principal activity and business review 
The main activity of the group continues to be the design, 
manufacture and supply of professional lighting equipment. 
Each company within the group operates in a different market 
of the lighting sector. 

Business review 
A review of the business and future developments is included 
in the Chairman’s statement on pages 5 to 7. 

Key performance indicators 
The directors consider the main financial key performance 
indicators (KPIs) to be those disclosed within page 1 of the financial 
highlights. The two most important KPIs to the business are 
turnover and operating profit. 

The directors monitor non-financial areas of the business relating 
to energy saving and environmental responsibility, market and 
product development, customer service and product support 
on a regular basis.  

Objectives are set for each company within the group 
incorporating financial and non-financial targets which have 
appropriate measurements that reflect their nature. These are 
monitored regularly at local and group Board level, during the year 
the majority of objectives were achieved or substantially achieved. 

Principal risks and uncertainties 
We have detailed below what we consider to be the principal risks 
and uncertainties to the business, and how we seek to manage 
and mitigate these risks. 

The group’s revenue and profit could be affected by spending 
reductions and inflationary pressures, particularly concerning the 
current global economic challenges. Adverse economic conditions 
can defer or reduce capital investment plans which our products 
are supplied into and are key sources of revenue for the group. 
We seek to manage and mitigate these risks by ensuring we have a 
broad range of customers in differing sectors, and also ensuring we 
offer high quality, technically advanced products, to differentiate 
the group from competitors. In addition, we actively seek to identify 
new opportunities to ensure we maximise our potential of winning 
new business. 

Changes in government policy, laws and regulation are constantly 
evolving, with continuing pressures on government spending 
plans. Reductions in spending and changing policy increases the 
risk to our order book; we have sought and continue to seek to 
diversify our customer portfolio to ensure we have an appropriate 
spread, mitigating the risk of any industry or specific sector 
spending issues. 

The group operates within a competitive environment with 
threats from existing competitors, potential new entrants and the 
continued evolution of existing technologies within the lighting 
industry. The group seeks to minimise these risks by offering 
innovative products and service solutions. We seek to manage and 
mitigate these risks by offering technologically advanced products 
to enable us to differentiate ourselves from our competitors, 
investing in our research and development activities to produce 
new and evolving product ranges for the future, to maintain and 

enhance our market position. The financial risks which impact the 
company are covered in the following paragraphs. 

Management reviews prices at least annually to take into account 
fluctuations in costs in order to minimise the risk of reduction in 
gross margin, or loss of market share from lack of competitiveness. 

The group has financial risks and seeks to minimise and manage 
these by incorporating controls into key functions as part of the 
normal business operation. 

The group offers credit terms to the majority of its customers and 
this activity carries financial risks of default and slow payment. 
There is a credit policy, which includes an assessment of the risk of 
bad debt and management of higher risk customers. The group has 
underwritten a significant part of its customer debt risk with a credit 
insurance policy. 

Details of other risk management procedures are included within 
the internal control section of this report. 

Cash and liquidity management 
The group’s cash is managed in accordance with the treasury 
policy. Cash is managed centrally on a daily basis to ensure that the 
group has sufficient funds available to meet its needs and invests 
the remainder. The majority of cash is placed with approved 
counterparties either on overnight deposit or time deposit. 
There are a series of time deposits which are maturing on a rolling 
cycle in order to meet regular business payments with a margin 
for larger regular and one-off payments as well as seasonal 
variation in cash requirements. 

The group primarily trades in sterling. There is an exposure to 
foreign currency as the group buys and sells in foreign currencies 
and maintains currency bank accounts in US Dollars and Euros. 
The activities of buying and selling in foreign currency are broadly 
matched with currencies bought and sold as required in order 
to minimise currency exposures. Larger exposures would be 
hedged in order to reduce the risk of adverse exchange rate 
movement. There were no currency hedging derivatives in place 
at 30 June 2012 or 30 June 2011. 

Employee policies 
Employees are kept informed of matters of concern to them 
as employees by publication and distribution of a company 
newsletter and other notices, or by specially convened meetings. 

Committees representing the different groups of employees meet 
regularly to ensure the views of employees are taken into account 
in making decisions that are likely to affect their interests. 

The involvement of employees in the group’s performance 
is encouraged by various incentive schemes including a profit 
related bonus scheme. 

Information on the financial and economic factors affecting 
the performance of the group is made available twice yearly 
at the time of publication of the interim and annual statements 
to shareholders. 

The group is committed to developing a safe and healthy working 

Creditor payment policy 

environment for all employees consistent with the requirements 

The group’s policy concerning the payment of its trade creditors 

of the Health and Safety at Work Act. Within the constraints 

of health and safety, disabled people are given full and fair 

consideration for job vacancies. Depending on their skills and 

is to accept and follow the normal terms of payment amongst 

suppliers to the lighting industry. Payments are made when they 

fall due, which is usually on the day after the end of the calendar 

abilities, disabled people enjoy the same career prospects as other 

month following the month in which delivery of goods or services 

employees, and if employees become disabled every effort is made 

is made. Where reasonable settlement discount terms are offered 

to ensure their continued employment, with appropriate training 

for early payment, these terms are usually taken up. The number 

where necessary. 

of days represented by the company’s year end trade payables is 

Policies for recruiting employees are designed to ensure equal 

opportunities irrespective of colour, ethnic or national origin, 

nationality, sex or marital status. 

Pension scheme position and funding 

The pension scheme position as shown in the balance sheet 

remains in surplus although there has been a decline during the 

year, which is primarily due to changes in actuarial assumptions. 

This may continue to adversely affect the surplus. A triennial 

actuarial valuation at 30 June 2012 is currently in progress. 

Following the previous valuation at 30 June 2009, a funding level 

44 (2011: 42).  

Group research and development activities 

The group is committed to research and development activities in 

order to maintain its market share in the industrial and commercial 

lighting market. These activities encompass constant development 

of both new and existing products to ensure that a leading position 

in the lighting market is maintained. 

During the year the group spent £1,052,000 on capitalised 

development costs which includes internal labour. 

for the future has been agreed between the trustees of the scheme 

Property, plant and equipment 

and the directors of the company. The directors consider it unlikely 

The directors are of the opinion that the market value of the 

that any changes to the present funding levels will have any 

freehold land and buildings is in excess of their net book value. 

significant effect on the strength of the company’s balance sheet. 

Whilst it is considered that the market value is significantly greater 

Results and dividends 

The results for the year are set out in detail on page 27. 

On 8 May 2012 the company paid an interim dividend of 4.6p 

per share (2011: 4.3p) amounting to £563,000 (2011: £504,000). 

A final dividend of 14.6p (2011: 13.3p) per ordinary share is 

proposed amounting to £1,712,000 (2011: £1,559,000) and, 

if approved, will be paid on 22 November 2012. Total dividends 

paid during the year amounted to £2,122,000 in aggregate 

(2011: £1,981,000). 

Directors 

on page 16. 

than the net book value for many of the group’s properties as a 

result of being acquired between six months and 23 years ago, 

management consider that undertaking formal valuation exercises 

would be costly for limited value and consequently no formal 

exercise has been undertaken. 

Charitable gifts 

During the year the group gave £21,910 (2011: £4,714) for 

charitable purposes. This is made up of donations to UK charities 

for children’s welfare of £2,640, cancer care of £70, healthcare 

of £150, emergency aid of £150, armed forces welfare of £17,500 

and local causes of £1,400. 

Substantial shareholdings 

The directors of the company at the date of this report are set out 

The directors retiring by rotation are A B Thorpe, M Allcock and C 

the following interests in 3% or more of the issued share capital, 

M Brangwin who, being eligible, offer themselves for re-election. 

excluding holdings of directors: 

At 12 October 2012 the company had received notification of 

The contracts for A B Thorpe and M Allcock are terminable 

on 24 months’ notice. C M Brangwin does not have a service 

FMR LLC 

E G Thorpe 

636,000 shares (5.3%) 

655,698 shares (5.5%) 

contract with the company. 

Directors’ share interests 

The details of the directors’ share interests are set out in the 

Directors’ remuneration report on pages 22 to 24. 

Directors’ indemnities 

As permitted by the Articles of Association, the directors have the 

benefit of an indemnity which is a qualifying third party indemnity 

provision as defined by section 234 of the Companies Act 2006. 

The indemnity was in force throughout the last financial year and 

is currently in force. The company also purchased and maintained 

throughout the financial year Directors’ and Officers’ liability 

insurance in respect of itself and its directors. 

Statement on the provision of information to auditors 

Each of the directors confirms that, as far as he is aware, there is 

no relevant audit information of which the group’s auditors are 

unaware, and that he has taken all the steps he ought to have as 

a director to make himself aware of any relevant audit information, 

and to establish that the auditors are aware of that information. 

The above is in accordance with the provisions of section 418 

of the Companies Act 2006. 

Independent auditors 

The auditors, PricewaterhouseCoopers LLP, have expressed 

their willingness to continue in office and a resolution for their 

re-appointment will be proposed at the next Annual 

General Meeting. 

015702_FW_Thorpe_18-68.indd   18

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GOVERNANCE 

REPORT OF THE DIRECTORS 

The directors have the pleasure in submitting their annual report 

enhance our market position. The financial risks which impact the 

and the audited consolidated financial statements of the group 

company are covered in the following paragraphs. 

and the company for the year ended 30 June 2012. 

Principal activity and business review 

The main activity of the group continues to be the design, 

Management reviews prices at least annually to take into account 

fluctuations in costs in order to minimise the risk of reduction in 

gross margin, or loss of market share from lack of competitiveness. 

manufacture and supply of professional lighting equipment. 

The group has financial risks and seeks to minimise and manage 

Each company within the group operates in a different market 

these by incorporating controls into key functions as part of the 

of the lighting sector. 

Business review 

A review of the business and future developments is included 

in the Chairman’s statement on pages 5 to 7. 

normal business operation. 

The group offers credit terms to the majority of its customers and 

this activity carries financial risks of default and slow payment. 

There is a credit policy, which includes an assessment of the risk of 

bad debt and management of higher risk customers. The group has 

underwritten a significant part of its customer debt risk with a credit 

Key performance indicators 

The directors consider the main financial key performance 

insurance policy. 

indicators (KPIs) to be those disclosed within page 1 of the financial 

Details of other risk management procedures are included within 

highlights. The two most important KPIs to the business are 

the internal control section of this report. 

turnover and operating profit. 

The directors monitor non-financial areas of the business relating 

to energy saving and environmental responsibility, market and 

product development, customer service and product support 

on a regular basis.  

Objectives are set for each company within the group 

incorporating financial and non-financial targets which have 

appropriate measurements that reflect their nature. These are 

Cash and liquidity management 

The group’s cash is managed in accordance with the treasury 

policy. Cash is managed centrally on a daily basis to ensure that the 

group has sufficient funds available to meet its needs and invests 

the remainder. The majority of cash is placed with approved 

counterparties either on overnight deposit or time deposit. 

There are a series of time deposits which are maturing on a rolling 

cycle in order to meet regular business payments with a margin 

monitored regularly at local and group Board level, during the year 

for larger regular and one-off payments as well as seasonal 

the majority of objectives were achieved or substantially achieved. 

variation in cash requirements. 

Principal risks and uncertainties 

We have detailed below what we consider to be the principal risks 

and uncertainties to the business, and how we seek to manage 

and mitigate these risks. 

The group primarily trades in sterling. There is an exposure to 

foreign currency as the group buys and sells in foreign currencies 

and maintains currency bank accounts in US Dollars and Euros. 

The activities of buying and selling in foreign currency are broadly 

matched with currencies bought and sold as required in order 

The group’s revenue and profit could be affected by spending 

to minimise currency exposures. Larger exposures would be 

reductions and inflationary pressures, particularly concerning the 

hedged in order to reduce the risk of adverse exchange rate 

current global economic challenges. Adverse economic conditions 

movement. There were no currency hedging derivatives in place 

can defer or reduce capital investment plans which our products 

at 30 June 2012 or 30 June 2011. 

are supplied into and are key sources of revenue for the group. 

We seek to manage and mitigate these risks by ensuring we have a 

Employee policies 

broad range of customers in differing sectors, and also ensuring we 

Employees are kept informed of matters of concern to them 

offer high quality, technically advanced products, to differentiate 

as employees by publication and distribution of a company 

the group from competitors. In addition, we actively seek to identify 

newsletter and other notices, or by specially convened meetings. 

new opportunities to ensure we maximise our potential of winning 

new business. 

Committees representing the different groups of employees meet 

regularly to ensure the views of employees are taken into account 

Changes in government policy, laws and regulation are constantly 

in making decisions that are likely to affect their interests. 

evolving, with continuing pressures on government spending 

plans. Reductions in spending and changing policy increases the 

risk to our order book; we have sought and continue to seek to 

diversify our customer portfolio to ensure we have an appropriate 

spread, mitigating the risk of any industry or specific sector 

spending issues. 

The group operates within a competitive environment with 

threats from existing competitors, potential new entrants and the 

continued evolution of existing technologies within the lighting 

industry. The group seeks to minimise these risks by offering 

innovative products and service solutions. We seek to manage and 

mitigate these risks by offering technologically advanced products 

to enable us to differentiate ourselves from our competitors, 

investing in our research and development activities to produce 

new and evolving product ranges for the future, to maintain and 

The involvement of employees in the group’s performance 

is encouraged by various incentive schemes including a profit 

related bonus scheme. 

Information on the financial and economic factors affecting 

the performance of the group is made available twice yearly 

at the time of publication of the interim and annual statements 

to shareholders. 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

19

The group is committed to developing a safe and healthy working 
environment for all employees consistent with the requirements 
of the Health and Safety at Work Act. Within the constraints 
of health and safety, disabled people are given full and fair 
consideration for job vacancies. Depending on their skills and 
abilities, disabled people enjoy the same career prospects as other 
employees, and if employees become disabled every effort is made 
to ensure their continued employment, with appropriate training 
where necessary. 

Policies for recruiting employees are designed to ensure equal 
opportunities irrespective of colour, ethnic or national origin, 
nationality, sex or marital status. 

Pension scheme position and funding 
The pension scheme position as shown in the balance sheet 
remains in surplus although there has been a decline during the 
year, which is primarily due to changes in actuarial assumptions. 
This may continue to adversely affect the surplus. A triennial 
actuarial valuation at 30 June 2012 is currently in progress. 
Following the previous valuation at 30 June 2009, a funding level 
for the future has been agreed between the trustees of the scheme 
and the directors of the company. The directors consider it unlikely 
that any changes to the present funding levels will have any 
significant effect on the strength of the company’s balance sheet. 

Results and dividends 
The results for the year are set out in detail on page 27. 

On 8 May 2012 the company paid an interim dividend of 4.6p 
per share (2011: 4.3p) amounting to £563,000 (2011: £504,000). 
A final dividend of 14.6p (2011: 13.3p) per ordinary share is 
proposed amounting to £1,712,000 (2011: £1,559,000) and, 
if approved, will be paid on 22 November 2012. Total dividends 
paid during the year amounted to £2,122,000 in aggregate 
(2011: £1,981,000). 

Directors 
The directors of the company at the date of this report are set out 
on page 16. 

The directors retiring by rotation are A B Thorpe, M Allcock and C 
M Brangwin who, being eligible, offer themselves for re-election. 
The contracts for A B Thorpe and M Allcock are terminable 
on 24 months’ notice. C M Brangwin does not have a service 
contract with the company. 

Directors’ share interests 
The details of the directors’ share interests are set out in the 
Directors’ remuneration report on pages 22 to 24. 

Directors’ indemnities 
As permitted by the Articles of Association, the directors have the 
benefit of an indemnity which is a qualifying third party indemnity 
provision as defined by section 234 of the Companies Act 2006. 
The indemnity was in force throughout the last financial year and 
is currently in force. The company also purchased and maintained 
throughout the financial year Directors’ and Officers’ liability 
insurance in respect of itself and its directors. 

Creditor payment policy 
The group’s policy concerning the payment of its trade creditors 
is to accept and follow the normal terms of payment amongst 
suppliers to the lighting industry. Payments are made when they 
fall due, which is usually on the day after the end of the calendar 
month following the month in which delivery of goods or services 
is made. Where reasonable settlement discount terms are offered 
for early payment, these terms are usually taken up. The number 
of days represented by the company’s year end trade payables is 
44 (2011: 42).  

Group research and development activities 
The group is committed to research and development activities in 
order to maintain its market share in the industrial and commercial 
lighting market. These activities encompass constant development 
of both new and existing products to ensure that a leading position 
in the lighting market is maintained. 

During the year the group spent £1,052,000 on capitalised 
development costs which includes internal labour. 

Property, plant and equipment 
The directors are of the opinion that the market value of the 
freehold land and buildings is in excess of their net book value. 
Whilst it is considered that the market value is significantly greater 
than the net book value for many of the group’s properties as a 
result of being acquired between six months and 23 years ago, 
management consider that undertaking formal valuation exercises 
would be costly for limited value and consequently no formal 
exercise has been undertaken. 

Charitable gifts 
During the year the group gave £21,910 (2011: £4,714) for 
charitable purposes. This is made up of donations to UK charities 
for children’s welfare of £2,640, cancer care of £70, healthcare 
of £150, emergency aid of £150, armed forces welfare of £17,500 
and local causes of £1,400. 

Substantial shareholdings 
At 12 October 2012 the company had received notification of 
the following interests in 3% or more of the issued share capital, 
excluding holdings of directors: 

FMR LLC 
E G Thorpe 

636,000 shares (5.3%) 
655,698 shares (5.5%) 

Statement on the provision of information to auditors 
Each of the directors confirms that, as far as he is aware, there is 
no relevant audit information of which the group’s auditors are 
unaware, and that he has taken all the steps he ought to have as 
a director to make himself aware of any relevant audit information, 
and to establish that the auditors are aware of that information. 
The above is in accordance with the provisions of section 418 
of the Companies Act 2006. 

Independent auditors 
The auditors, PricewaterhouseCoopers LLP, have expressed 
their willingness to continue in office and a resolution for their 
re-appointment will be proposed at the next Annual 
General Meeting. 

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20

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

GOVERNANCE 
REPORT OF THE DIRECTORS CONTINUED 

GOVERNANCE 

Directors’ authority to issue shares 
There is no longer a requirement to obtain the consent of 
shareholders to each issue by the company of equity share 
capital for cash made otherwise than to existing shareholders in 
proportion to their existing shareholdings. This relaxation is subject 
to the company obtaining the authority of shareholders under 
section 571 of the Companies Act 2006 to disapply generally the 
statutory pre-emption rights conferred by section 561 of the 
Companies Act 2006. Ordinary resolution number 8 would give the 
directors the authority to allot shares in the company or to grant 
rights to subscribe for, or to convert any security into, shares in the 
company up to an aggregate nominal amount of £310,644 (which 
represents approximately 26% of the company’s issued ordinary 
shares, excluding treasury shares, as at 12 October 2012). Special 
resolution number 9 would further allow the directors to allot 
equity securities or sell treasury shares for cash without first offering 
them to existing shareholders, in proportion to existing holdings, 
up to the same maximum nominal amount of £310,644 (which 
represents approximately 26% of the company’s issued ordinary 
shares, excluding treasury shares) as at 12 October 2012.  

This authority would, however, only allow the directors to do so 
in connection with a pre-emptive rights issue and, in any other 
case, the maximum nominal amount of equity securities which 
may be so allotted is £58,618 (which represents approximately 5% 
of the company’s issued ordinary shares (excluding treasury shares) 
as at 12 October 2012.  

These authorities, if approved, would expire at the conclusion of 
the next Annual General Meeting, save that the authority relating 
to section 561 would expire 15 months after being passed, if earlier. 

Purchase of own shares 
Resolution number 10 set out in the notice of the Annual General 
Meeting will, if it is approved, allow the company to exercise the 
authority contained in the Articles of Association to purchase its 
own shares. The Board has no firm intention that the company 
should make purchases of its own shares if the proposed authority 
becomes effective, but would like to be able to act quickly if 
circumstances arise in which such a purchase would be desirable. 
Purchases will only be made on the Alternative Investment Market 
and only in circumstances where the directors believe that they are 
in the best interests of the shareholders generally. Furthermore, 
purchases will only be made if the directors believe that they would 
result in an increase in earnings per share. 

The proposed authority will be limited by the terms of the 
special resolution to the purchase of 1,189,356 ordinary shares 
representing 10% of the company’s issued ordinary share capital at 
12 October 2012 and a nominal value of £118,936. 

The minimum price per ordinary share payable by the company 
(exclusive of expenses) will be 10p. The maximum to be paid will 
be an amount not more than 5% above the average of the middle 
market quotations for ordinary shares of the company as derived 
from the Alternative Investment Market on the five business days 
immediately preceding the date of each purchase. The company 
may either cancel any shares which it purchases under this 
authority or transfer them into treasury, and subsequently sell 
or transfer them out of treasury or cancel them. The maximum 
number of shares and the permitted price range are stated in order 
to comply with statutory and Stock Exchange requirements and 
should not be taken as representative of the number of shares 
(if any) which may be purchased, or the terms of such a purchase.  

The authority will lapse on the date of the Annual General Meeting 
of the company in 2013. However, in order to maintain the Board’s 
flexibility of action it is envisaged that it will be renewed at future 
Annual General Meetings. 

Corporate governance 
As a company whose shares are traded on the Alternative 
Investment Market of the London Stock Exchange Plc, the 
company is not required to comply with the Principles of Good 
Governance and Code of Best Practice (“The UK Corporate 
Governance Code”, or the “Code”). However, the Board supports 
the standards required by the Code and fully endorses the 
principles of openness, integrity and accountability of the Code. 
The directors consider that the company applies the principles of 
best practice with the exception of the matters listed below. 

•  The Board does not have an independent audit committee. 

•  At least half the Board does not comprise independent 

non-executive directors and the Board has not appointed 
a senior independent director. 

•  The terminable period of the service contract for A B Thorpe and 

M Allcock exceeds one year. 

•  The pensionable salary includes profit bonus for those directors 

who are members of the defined benefit scheme. 

•  The Board has combined the roles of Joint Chief Executive 

and Chairman. 

•  There are no independent Board members. 

The directors believe that the exceptions, which are more fully 
explained in the sections relating to the Board constitution and 
the directors’ remuneration report, are appropriate for the size 
and context of the group’s business. 

Board constitution 
The company continues to be proprietorial in nature and the 
directors act as a unitary Board and as a consequence are unable 
to see the benefits of splitting the Board into sub-committees and 
in particular of constituting audit and nomination committees, 
as recommended by the Code, as matters that would normally 
be considered by an audit or nomination committee are addressed 
by the full Board with the non-executive directors present and the 
auditors attending as appropriate. 

A remuneration committee has been established with the 
following people serving on it: 

P D Mason 
Non-executive director and Chairman of the committee. 

I A Thorpe  
Non-executive director. 

Terms and conditions for the operation of this committee are in 
place and it meets as and when required. The committee’s report 
is presented on pages 22 to 24. 

The auditors have direct access to all members of the Board and 
attend and present their reports at appropriate Board meetings. 
The Board considers, at least annually, the relationships and 
fees in place with the auditors to confirm their independence 
is maintained. 

Where there is a requirement for a senior personnel or subsidiary 

Going concern 

board appointment a sub-committee is formed. Any appointment 

The directors confirm that they are satisfied that the group and 

to the group board would involve all board members in the 

company have adequate resources, with £14.1m cash and £17.1m 

selection process. 

The Board meets regularly during the year and has a schedule 

of matters reserved for its approval, which only the Board may 

change. 

By order of the Board 

short-term deposits, to continue in business for the foreseeable 

future, and for this reason, they continue to adopt the going 

concern basis in preparing the accounts. 

C Muncaster 

Company Secretary 

12 October 2012  

Registered Office: 

Merse Road 

North Moons Moat 

Redditch 

Worcestershire 

B98 9HH 

Company Registration Number: 317886 

Relations with shareholders 

Directors are kept informed of the views of shareholders by  

face-to-face contact at the company’s premises on the day of 

the Annual General Meeting and, if appropriate, by meeting 

with major shareholders at other times during the year. 

Internal control 

The Board of directors has overall responsibility for the system 

of internal control and for reviewing its effectiveness throughout 

the group. The internal control systems are designed to meet 

the group’s particular needs and the risks to which it is exposed, 

and by their nature can only provide reasonable but not absolute 

assurance against misstatement or loss. 

The directors have responsibility for maintaining a system of 

internal control which provides reasonable assurance of the 

effective and efficient operations, internal financial control and 

compliance with laws and regulations. 

Internal financial control 

During the year, a member of the group finance department has 

visited all operating sites to assess their compliance with a selection 

of key control procedures and non-compliance has been reported 

to the group Board. Any areas of non-compliance noted as part of 

this process have been addressed. 

In addition, the executive directors regularly visit all operating sites 

and review with local management financial and commercial 

issues affecting the group’s operations. Regular financial reporting 

includes rolling forecasts and monthly financial reports comparing 

performance against plan. These reports are reviewed locally 

with a group representative and monitored by the group Board. 

Accordingly, the directors do not consider that an internal 

audit department is required. 

Other areas of control 

During the year and continuing after the year end, the Board has 

operated a formal risk identification and evaluation process as part 

of a continuous review of the group’s internal controls. This process 

considers financial, operational and compliance risks and includes 

participation from senior executives from all operating subsidiaries. 

The results of this process to date have been utilised by the Board 

to focus the ongoing process for identifying, evaluating and 

managing the group’s significant risks. The programme is utilised 

to monitor the potential impact of the risks identified and, where 

appropriate, actions are taken to ensure they are effectively 

controlled. This process is extended to include a detailed review 

of risk, as assessed by local senior executives, and procedures have 

been established to ensure that the group Board is made aware 

of any additional significant risks identified and to consider 

appropriate action. This process culminated in the provision of a 

certificate, by senior executives at the operating sites, confirming 

that they have identified and addressed the risks arising in their 

business and reported them to the group Board accordingly. 

015702_FW_Thorpe_18-68.indd   20

10/10/2012   15:49

 
 
 
 
 
 
 
 
GOVERNANCE 

REPORT OF THE DIRECTORS CONTINUED 

Directors’ authority to issue shares 

There is no longer a requirement to obtain the consent of 

shareholders to each issue by the company of equity share 

The authority will lapse on the date of the Annual General Meeting 

of the company in 2013. However, in order to maintain the Board’s 

flexibility of action it is envisaged that it will be renewed at future 

capital for cash made otherwise than to existing shareholders in 

Annual General Meetings. 

proportion to their existing shareholdings. This relaxation is subject 

to the company obtaining the authority of shareholders under 

Corporate governance 

section 571 of the Companies Act 2006 to disapply generally the 

As a company whose shares are traded on the Alternative 

statutory pre-emption rights conferred by section 561 of the 

Investment Market of the London Stock Exchange Plc, the 

Companies Act 2006. Ordinary resolution number 8 would give the 

company is not required to comply with the Principles of Good 

directors the authority to allot shares in the company or to grant 

Governance and Code of Best Practice (“The UK Corporate 

rights to subscribe for, or to convert any security into, shares in the 

Governance Code”, or the “Code”). However, the Board supports 

company up to an aggregate nominal amount of £310,644 (which 

the standards required by the Code and fully endorses the 

represents approximately 26% of the company’s issued ordinary 

principles of openness, integrity and accountability of the Code. 

shares, excluding treasury shares, as at 12 October 2012). Special 

The directors consider that the company applies the principles of 

resolution number 9 would further allow the directors to allot 

best practice with the exception of the matters listed below. 

equity securities or sell treasury shares for cash without first offering 

them to existing shareholders, in proportion to existing holdings, 

•  The Board does not have an independent audit committee. 

up to the same maximum nominal amount of £310,644 (which 

•  At least half the Board does not comprise independent 

represents approximately 26% of the company’s issued ordinary 

non-executive directors and the Board has not appointed 

shares, excluding treasury shares) as at 12 October 2012.  

a senior independent director. 

This authority would, however, only allow the directors to do so 

in connection with a pre-emptive rights issue and, in any other 

case, the maximum nominal amount of equity securities which 

may be so allotted is £58,618 (which represents approximately 5% 

of the company’s issued ordinary shares (excluding treasury shares) 

as at 12 October 2012.  

•  The terminable period of the service contract for A B Thorpe and 

M Allcock exceeds one year. 

•  The pensionable salary includes profit bonus for those directors 

who are members of the defined benefit scheme. 

•  The Board has combined the roles of Joint Chief Executive 

These authorities, if approved, would expire at the conclusion of 

and Chairman. 

the next Annual General Meeting, save that the authority relating 

•  There are no independent Board members. 

to section 561 would expire 15 months after being passed, if earlier. 

Purchase of own shares 

Resolution number 10 set out in the notice of the Annual General 

Meeting will, if it is approved, allow the company to exercise the 

authority contained in the Articles of Association to purchase its 

own shares. The Board has no firm intention that the company 

should make purchases of its own shares if the proposed authority 

becomes effective, but would like to be able to act quickly if 

circumstances arise in which such a purchase would be desirable. 

Purchases will only be made on the Alternative Investment Market 

and only in circumstances where the directors believe that they are 

in the best interests of the shareholders generally. Furthermore, 

purchases will only be made if the directors believe that they would 

result in an increase in earnings per share. 

The directors believe that the exceptions, which are more fully 

explained in the sections relating to the Board constitution and 

the directors’ remuneration report, are appropriate for the size 

and context of the group’s business. 

Board constitution 

The company continues to be proprietorial in nature and the 

directors act as a unitary Board and as a consequence are unable 

to see the benefits of splitting the Board into sub-committees and 

in particular of constituting audit and nomination committees, 

as recommended by the Code, as matters that would normally 

be considered by an audit or nomination committee are addressed 

by the full Board with the non-executive directors present and the 

auditors attending as appropriate. 

A remuneration committee has been established with the 

following people serving on it: 

The proposed authority will be limited by the terms of the 

special resolution to the purchase of 1,189,356 ordinary shares 

representing 10% of the company’s issued ordinary share capital at 

P D Mason 

12 October 2012 and a nominal value of £118,936. 

Non-executive director and Chairman of the committee. 

The minimum price per ordinary share payable by the company 

I A Thorpe  

(exclusive of expenses) will be 10p. The maximum to be paid will 

Non-executive director. 

be an amount not more than 5% above the average of the middle 

market quotations for ordinary shares of the company as derived 

from the Alternative Investment Market on the five business days 

immediately preceding the date of each purchase. The company 

may either cancel any shares which it purchases under this 

authority or transfer them into treasury, and subsequently sell 

Terms and conditions for the operation of this committee are in 

place and it meets as and when required. The committee’s report 

is presented on pages 22 to 24. 

The auditors have direct access to all members of the Board and 

attend and present their reports at appropriate Board meetings. 

or transfer them out of treasury or cancel them. The maximum 

The Board considers, at least annually, the relationships and 

number of shares and the permitted price range are stated in order 

fees in place with the auditors to confirm their independence 

to comply with statutory and Stock Exchange requirements and 

is maintained. 

should not be taken as representative of the number of shares 

(if any) which may be purchased, or the terms of such a purchase.  

FW Thorpe Plc
Annual	Report	and	Accounts	2012

21

Where there is a requirement for a senior personnel or subsidiary 
board appointment a sub-committee is formed. Any appointment 
to the group board would involve all board members in the 
selection process. 

The Board meets regularly during the year and has a schedule 
of matters reserved for its approval, which only the Board may 
change. 

Going concern 
The directors confirm that they are satisfied that the group and 
company have adequate resources, with £14.1m cash and £17.1m 
short-term deposits, to continue in business for the foreseeable 
future, and for this reason, they continue to adopt the going 
concern basis in preparing the accounts. 

By order of the Board 

C Muncaster 
Company Secretary 

12 October 2012  

Registered Office: 
Merse Road 
North Moons Moat 
Redditch 
Worcestershire 
B98 9HH 

Company Registration Number: 317886 

Relations with shareholders 
Directors are kept informed of the views of shareholders by  
face-to-face contact at the company’s premises on the day of 
the Annual General Meeting and, if appropriate, by meeting 
with major shareholders at other times during the year. 

Internal control 
The Board of directors has overall responsibility for the system 
of internal control and for reviewing its effectiveness throughout 
the group. The internal control systems are designed to meet 
the group’s particular needs and the risks to which it is exposed, 
and by their nature can only provide reasonable but not absolute 
assurance against misstatement or loss. 

The directors have responsibility for maintaining a system of 
internal control which provides reasonable assurance of the 
effective and efficient operations, internal financial control and 
compliance with laws and regulations. 

Internal financial control 
During the year, a member of the group finance department has 
visited all operating sites to assess their compliance with a selection 
of key control procedures and non-compliance has been reported 
to the group Board. Any areas of non-compliance noted as part of 
this process have been addressed. 

In addition, the executive directors regularly visit all operating sites 
and review with local management financial and commercial 
issues affecting the group’s operations. Regular financial reporting 
includes rolling forecasts and monthly financial reports comparing 
performance against plan. These reports are reviewed locally 
with a group representative and monitored by the group Board. 
Accordingly, the directors do not consider that an internal 
audit department is required. 

Other areas of control 
During the year and continuing after the year end, the Board has 
operated a formal risk identification and evaluation process as part 
of a continuous review of the group’s internal controls. This process 
considers financial, operational and compliance risks and includes 
participation from senior executives from all operating subsidiaries. 
The results of this process to date have been utilised by the Board 
to focus the ongoing process for identifying, evaluating and 
managing the group’s significant risks. The programme is utilised 
to monitor the potential impact of the risks identified and, where 
appropriate, actions are taken to ensure they are effectively 
controlled. This process is extended to include a detailed review 
of risk, as assessed by local senior executives, and procedures have 
been established to ensure that the group Board is made aware 
of any additional significant risks identified and to consider 
appropriate action. This process culminated in the provision of a 
certificate, by senior executives at the operating sites, confirming 
that they have identified and addressed the risks arising in their 
business and reported them to the group Board accordingly. 

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22

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

GOVERNANCE 
DIRECTORS’ REMUNERATION REPORT  

Remuneration policy – non-executive directors 
The Board as a whole determines the remuneration of the 
non-executive directors. The Board takes into account the 
contribution made and the relative time spent on the company’s 
affairs. The non-executive directors do not receive bonuses. 
Their benefits in kind consist of the provision of health insurance.  

Directors’ service contracts 
The policy for directors’ service contracts is to follow the Code 
for new appointments; however, for contracts in existence prior 
to the date the Code became effective, no amendment is expected 
to be made in view of the predicted service lives of the people 
concerned. A B Thorpe and M Allcock have service contracts 
terminable on two years’ notice. These contracts do not comply 
with the Code because they are in excess of one year. A M Cooper 
and D Taylor have service contracts terminable on one year’s 
notice. C Muncaster has a service contract which is terminable on 
six months’ notice. P D Mason, C M Brangwin and I A Thorpe do not 
have formal service contracts with the company. 

Performance graph 
The graph below shows the comparative data for the FTSE AIM 
share index and the FTSE Fledgling share index, rebased to 100, 
as these are considered to be the most appropriate comparative 
indices for the company’s business. 

Total shareholder return

FW Thorpe Plc
AIM All Share
FTSE Fledgling

29/6/08

29/6/09

29/6/10

29/6/11

29/6/12

The Board has prepared this report to the shareholders, taking 
into account the provisions in the UK Corporate Governance Code 
and sections 420 to 422 of the Companies Act 2006. The Board 
has delegated the responsibility for the executive directors’ 
remuneration to the remuneration committee. The scope of their 
responsibilities includes the executive directors’ service contracts, 
salaries and other benefits, which comprise their terms and 
conditions of employment. 

Remuneration committee 
The current members of the remuneration committee are 
the non-executive directors P D Mason (Chairman of the 
committee) and I A Thorpe. The committee has met as and 
when required during the financial year. No member of the 
committee has any personal financial interest in the matters 
to be decided other than as shareholders. There are no 
conflicts of interest arising from cross-directorships or day-to-day 
involvement in running the business. The committee has access 
to market data when considering the remuneration of the 
executive directors.  

Remuneration policy – executive directors 
The aim of the committee is to ensure that the executive directors 
are fairly rewarded for their responsibilities and contribution to the 
performance of the group. The committee seeks to achieve this 
with a combination of performance and non-performance related 
remuneration designed to attract, retain and motivate the directors.  

In establishing the salaries of the directors, the committee takes 
into account the responsibilities and performance of the individual 
together with data from comparable organisations and indicative 
trends for the business and its economic sector. 

The remuneration package consists of the following elements. 

1.  Basic salary, benefits in kind and other benefits. The salary 
is determined in August each year, unless there has been 
a change in responsibilities, where an adjustment will be 
made at the same time. The benefits in kind mainly consist 
of the provision of a car and health insurance. A director may 
choose to take a cash allowance instead of a car. Other benefits 
consist of pension arrangements and life assurance. 

2.  Annual bonus. The bonus is made up of two elements. 

The first element relates to the operating profit of the 
business unit for which the director has specific performance 
responsibilities. The second element relates to the operating 
profit of the group as a whole. The bonuses are paid in 
September and relate to the period ending on 30 June in the 
same year. 

200

150

100

50

0
29/6/07

GOVERNANCE 

Directors’ emoluments 

Executive directors 

A B Thorpe 

M Allcock 

D Taylor 

A M Cooper 

C Muncaster  

C M Brangwin 

I A Thorpe 

P D Mason 

Total emoluments 

D A Dimeloe – resigned 2 December 2011 

N A Brangwin – resigned 2 December 2011 

Non-executive directors 

2012 

Salary/fees 

£’000

2012 

Bonus 

£’000

2012 

Benefits  

£’000 

2012 

Total 

£’000

2011

Total 

£’000

178

178

78

89

89

46

27

24

24

24

89

89

30

62

75

–

–

–

–

–

25 

23 

14 

11 

11 

5 

4 

10 

12 

4 

292

290

122

162

175

51

31

34

36

28

285

272

118

157

156

255

94

34

35

114

757

345

119 

1,221

1,520

In addition to the above emoluments, payments were made to D A Dimeloe of £48,000 and N A Brangwin of £5,000 in respect of 

compensation for loss of office. The total directors’ emoluments including compensation for loss of office amounted to £1,274,000.  

Directors’ pension arrangements 

M Allcock, A M Cooper and D Taylor are members of the defined 

The defined benefit section aims to provide a maximum pension 

contribution section of the FW Thorpe Retirement Benefits Scheme. 

of two-thirds of pensionable salary at normal retirement date. 

M Allcock and D Taylor have a final salary guarantee as they were 

M Allcock’s and D Taylor’s pensionable salary includes an average 

previously members of the defined benefit section. C Muncaster 

of the previous three years’ profit bonus. These definitions do not 

has a personal pension to which the company contributes. 

comply with the Code; however, the committee believes that they 

C M Brangwin, I A Thorpe, A B Thorpe and P D Mason are retired 

members of the defined benefit section. 

The FW Thorpe Retirement Benefits Scheme is a funded, Inland 

Revenue approved occupational pension scheme. The scheme 

is divided into two sections – a defined benefit scheme and a 

defined contribution scheme. The defined benefit section was 

closed to new members on 1 October 1995.  

are appropriate when looking at the remuneration package as 

a whole. Defined contribution members contribute up to 5% 

of basic salary and the company contributes up to 14%. 

All the executive directors are covered by life assurance benefit 

of four times pensionable salary. In addition, the defined benefit 

scheme members are entitled to a spouse’s pension on death.  

The following directors, excluding those classified as pensioners, had accrued entitlements under the defined benefit section of 

the pension scheme.  

The following table shows the contributions paid by the company in respect of those directors participating in the defined contribution 

section of the pension scheme. 

M Allcock 

D Taylor 

D A Dimeloe 

N A Brangwin 

A M Cooper 

Value of 

accrued 

Director’s 

contributions 

Change in 

value of 

accrued 

Age at 

Normal 

30 June 2012 

year

30 June 2011

year end

pension age

£pa 

£

£pa

pension at 

during the 

pension since 

44

50

65

65

61,005 

40,112 

8,650

4,848

5,364

6,439

2012 

£

6,304

1,291

4,320

2011

£

14,688

3,008

4,000

015702_FW_Thorpe_18-68.indd   22

10/10/2012   15:49

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
GOVERNANCE 

DIRECTORS’ REMUNERATION REPORT  

The Board has prepared this report to the shareholders, taking 

Remuneration policy – non-executive directors 

into account the provisions in the UK Corporate Governance Code 

The Board as a whole determines the remuneration of the 

and sections 420 to 422 of the Companies Act 2006. The Board 

non-executive directors. The Board takes into account the 

has delegated the responsibility for the executive directors’ 

contribution made and the relative time spent on the company’s 

remuneration to the remuneration committee. The scope of their 

affairs. The non-executive directors do not receive bonuses. 

responsibilities includes the executive directors’ service contracts, 

Their benefits in kind consist of the provision of health insurance.  

salaries and other benefits, which comprise their terms and 

conditions of employment. 

Remuneration committee 

The current members of the remuneration committee are 

the non-executive directors P D Mason (Chairman of the 

committee) and I A Thorpe. The committee has met as and 

when required during the financial year. No member of the 

committee has any personal financial interest in the matters 

to be decided other than as shareholders. There are no 

Directors’ service contracts 

The policy for directors’ service contracts is to follow the Code 

for new appointments; however, for contracts in existence prior 

to the date the Code became effective, no amendment is expected 

to be made in view of the predicted service lives of the people 

concerned. A B Thorpe and M Allcock have service contracts 

terminable on two years’ notice. These contracts do not comply 

with the Code because they are in excess of one year. A M Cooper 

and D Taylor have service contracts terminable on one year’s 

conflicts of interest arising from cross-directorships or day-to-day 

notice. C Muncaster has a service contract which is terminable on 

involvement in running the business. The committee has access 

six months’ notice. P D Mason, C M Brangwin and I A Thorpe do not 

to market data when considering the remuneration of the 

have formal service contracts with the company. 

executive directors.  

Remuneration policy – executive directors 

The graph below shows the comparative data for the FTSE AIM 

The aim of the committee is to ensure that the executive directors 

share index and the FTSE Fledgling share index, rebased to 100, 

are fairly rewarded for their responsibilities and contribution to the 

as these are considered to be the most appropriate comparative 

performance of the group. The committee seeks to achieve this 

indices for the company’s business. 

with a combination of performance and non-performance related 

remuneration designed to attract, retain and motivate the directors.  

Total shareholder return

Performance graph 

FW Thorpe Plc

AIM All Share

FTSE Fledgling

29/6/07

29/6/08

29/6/09

29/6/10

29/6/11

29/6/12

In establishing the salaries of the directors, the committee takes 

into account the responsibilities and performance of the individual 

together with data from comparable organisations and indicative 

trends for the business and its economic sector. 

The remuneration package consists of the following elements. 

1.  Basic salary, benefits in kind and other benefits. The salary 

is determined in August each year, unless there has been 

a change in responsibilities, where an adjustment will be 

made at the same time. The benefits in kind mainly consist 

of the provision of a car and health insurance. A director may 

choose to take a cash allowance instead of a car. Other benefits 

consist of pension arrangements and life assurance. 

200

150

100

50

0

2.  Annual bonus. The bonus is made up of two elements. 

The first element relates to the operating profit of the 

business unit for which the director has specific performance 

responsibilities. The second element relates to the operating 

profit of the group as a whole. The bonuses are paid in 

September and relate to the period ending on 30 June in the 

same year. 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

23

Directors’ emoluments 

Executive directors 
A B Thorpe 
M Allcock 
D Taylor 
A M Cooper 
C Muncaster  
D A Dimeloe – resigned 2 December 2011 
N A Brangwin – resigned 2 December 2011 
Non-executive directors 
C M Brangwin 
I A Thorpe 
P D Mason 

2012 
Salary/fees 
£’000

2012 
Bonus 
£’000

2012 
Benefits  
£’000 

2012 
Total 
£’000

2011
Total 
£’000

178
178
78
89
89
46
27

24
24
24

89
89
30
62
75
–
–

–
–
–

25 
23 
14 
11 
11 
5 
4 

10 
12 
4 

292
290
122
162
175
51
31

34
36
28

285
272
118
157
156
255
94

34
35
114

Total emoluments 

757

345

119 

1,221

1,520

In addition to the above emoluments, payments were made to D A Dimeloe of £48,000 and N A Brangwin of £5,000 in respect of 
compensation for loss of office. The total directors’ emoluments including compensation for loss of office amounted to £1,274,000.  

Directors’ pension arrangements 
M Allcock, A M Cooper and D Taylor are members of the defined 
contribution section of the FW Thorpe Retirement Benefits Scheme. 
M Allcock and D Taylor have a final salary guarantee as they were 
previously members of the defined benefit section. C Muncaster 
has a personal pension to which the company contributes. 

C M Brangwin, I A Thorpe, A B Thorpe and P D Mason are retired 
members of the defined benefit section. 

The FW Thorpe Retirement Benefits Scheme is a funded, Inland 
Revenue approved occupational pension scheme. The scheme 
is divided into two sections – a defined benefit scheme and a 
defined contribution scheme. The defined benefit section was 
closed to new members on 1 October 1995.  

The defined benefit section aims to provide a maximum pension 
of two-thirds of pensionable salary at normal retirement date. 
M Allcock’s and D Taylor’s pensionable salary includes an average 
of the previous three years’ profit bonus. These definitions do not 
comply with the Code; however, the committee believes that they 
are appropriate when looking at the remuneration package as 
a whole. Defined contribution members contribute up to 5% 
of basic salary and the company contributes up to 14%. 

All the executive directors are covered by life assurance benefit 
of four times pensionable salary. In addition, the defined benefit 
scheme members are entitled to a spouse’s pension on death.  

The following directors, excluding those classified as pensioners, had accrued entitlements under the defined benefit section of 
the pension scheme.  

M Allcock 
D Taylor 

Value of 
accrued 
pension at 
30 June 2012 
£pa 

Director’s 
contributions 
during the 
year
£

Change in 
value of 
accrued 
pension since 
30 June 2011
£pa

Age at 
year end

Normal 
pension age

44
50

65
65

61,005 
40,112 

8,650
4,848

5,364
6,439

The following table shows the contributions paid by the company in respect of those directors participating in the defined contribution 
section of the pension scheme. 

D A Dimeloe 
N A Brangwin 
A M Cooper 

2012 
£

6,304
1,291
4,320

2011
£

14,688
3,008
4,000

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24

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

GOVERNANCE 
DIRECTORS’ REMUNERATION REPORT CONTINUED 

GOVERNANCE 

STATEMENT OF DIRECTORS’ RESPONSIBILITIES 

C Muncaster has a personal pension which is not part of the company scheme, and the following contributions have been made during 
the year. 

and regulations. 

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law 

C Muncaster 

2012 
£

2011
£

7,828

8,480

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have prepared 

the group and parent company financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted 

by the European Union. Under company law the directors must not approve the financial statements unless they are satisfied that they 

give a true and fair view of the state of the affairs of the group and the company and of the profit or loss of the group for that period.  

Directors’ shareholdings 
The directors listed below were in office during the year. Directors’ interests in the share capital of the company at 30 June 2012 and 1 July 
2011 were as follows: 

Executive directors 
A B Thorpe 
M Allcock 
D Taylor 
A M Cooper 
C Muncaster  
Non-executive directors 
C M Brangwin 
I A Thorpe 
P D Mason 

  Ordinary shares of 10p 

Beneficial 
2012

2011

2,789,984 2,805,841
11,400
5,022
8,400
–

11,400
5,022
8,400
–

773,155

773,155
2,504,712 2,504,712
165,137

162,637

In addition, C M Brangwin has a joint non-beneficial interest in 170,000 shares (2011: 170,000 shares).  

The market price of the company’s shares at the beginning and end of the financial year was 797.5p and 1035p respectively and the range 
of market prices during the year was from 749p to 1090p.  

There have been no other changes in the interests of the directors in the share capital of any company in the group during the period 
1 July 2012 to 12 October 2012. 

Approved by the Board and signed on its behalf by: 

C Muncaster 
Company Secretary 

12 October 2012 

015702_FW_Thorpe_18-68.indd   24

10/10/2012   15:49

In preparing those accounts, the directors are required to: 

•  select suitable accounting policies and then apply them consistently; 

•  make judgements and accounting estimates that are reasonable and prudent; 

•  state whether applicable IFRS’s as adopted by the European Union have been followed, subject to any material departures disclosed 

and explained in the financial statement;  

business. 

•  prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in 

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

and disclose with reasonable accuracy at any time the financial position of the company and the group and enable them to ensure that 

the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company 

and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. 

The directors are responsible for the maintenance and integrity of the company’s website. Legislation in the United Kingdom governing 

the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. 

By order of the Board 

C Muncaster 

Company Secretary 

12 October 2012 

 
 
 
 
 
 
 
GOVERNANCE 

DIRECTORS’ REMUNERATION REPORT CONTINUED 

GOVERNANCE 
STATEMENT OF DIRECTORS’ RESPONSIBILITIES 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

25

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law 
and regulations. 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have prepared 
the group and parent company financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted 
by the European Union. Under company law the directors must not approve the financial statements unless they are satisfied that they 
give a true and fair view of the state of the affairs of the group and the company and of the profit or loss of the group for that period.  

In preparing those accounts, the directors are required to: 

•  select suitable accounting policies and then apply them consistently; 

•  make judgements and accounting estimates that are reasonable and prudent; 

•  state whether applicable IFRS’s as adopted by the European Union have been followed, subject to any material departures disclosed 

and explained in the financial statement;  

•  prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in 

business. 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions 
and disclose with reasonable accuracy at any time the financial position of the company and the group and enable them to ensure that 
the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company 
and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. 

The directors are responsible for the maintenance and integrity of the company’s website. Legislation in the United Kingdom governing 
the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. 

In addition, C M Brangwin has a joint non-beneficial interest in 170,000 shares (2011: 170,000 shares).  

The market price of the company’s shares at the beginning and end of the financial year was 797.5p and 1035p respectively and the range 

of market prices during the year was from 749p to 1090p.  

There have been no other changes in the interests of the directors in the share capital of any company in the group during the period 

1 July 2012 to 12 October 2012. 

Approved by the Board and signed on its behalf by: 

By order of the Board 

C Muncaster 
Company Secretary 

12 October 2012 

C Muncaster has a personal pension which is not part of the company scheme, and the following contributions have been made during 

The directors listed below were in office during the year. Directors’ interests in the share capital of the company at 30 June 2012 and 1 July 

2012 

£

2011

£

7,828

8,480

  Ordinary shares of 10p 

Beneficial 

2012

2011

2,789,984 2,805,841

11,400

5,022

8,400

–

11,400

5,022

8,400

–

773,155

773,155

2,504,712 2,504,712

162,637

165,137

the year. 

C Muncaster 

Directors’ shareholdings 

2011 were as follows: 

Executive directors 

A B Thorpe 

M Allcock 

D Taylor 

A M Cooper 

C Muncaster  

C M Brangwin 

I A Thorpe 

P D Mason 

Non-executive directors 

C Muncaster 

Company Secretary 

12 October 2012 

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26

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

GOVERNANCE 
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF 
FW THORPE PLC 

ACCOUNTS 

CONSOLIDATED INCOME STATEMENT 

FOR THE YEAR ENDED 30 JUNE 2012 

Continuing operations 

Revenue 

Cost of sales 

Gross profit 

Distribution costs 

Administrative expenses 

Operating profit 

Net finance income 

Share of loss of joint venture 

Profit before income tax 

Income tax expense 

Profit for the year from continuing operations 

Profit for the year from discontinued operations* 

Profit for the year 

operations. 

year (expressed in pence per share). 

Basic and diluted earnings per share 

– Basic 

– Diluted 

– Basic 

– Diluted 

– Basic 

– Diluted 

Note 

2012

£’000

2011

£’000

2 

55,559

(30,674)

52,833

(29,635)

24,885

(4,128)

(8,907)

23,198

(3,994)

(7,952)

11,850

11,252

831

(23)

372

(11)

12,658

(2,718)

11,613

(3,201)

9,940

1,377

8,412

999

11,317

9,411

3 

6 

32 

7 

Note 

23 

23 

23 

23 

23 

23 

Continuing operations

Continuing operations

Discontinued operations

Discontinued operations

Total

Total

2012 

pence

84.8

84.8

11.7

11.7

96.5

96.5

2011 

pence

71.8

71.8

8.5

8.5

80.3

80.3

*Profit for the year from discontinued operations in 2012 includes the exceptional item of profit on sale from disposal of a subsidiary.  There is no other income from discontinued 

Earnings per share from continuing and discontinued operations attributable to the equity holders of the company during the 

The notes on pages 33 to 64 are an integral part of these consolidated financial statements and parent company financial statements. 

The company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the parent company 

income statement. 

The profit for the parent company for the year was £16,525,000 (2011: £8,376,000) inclusive of exceptional profit on disposal of Mackwell 

Electronics Limited amounting to £5,578,000. 

We have audited the group and parent company financial statements (the “financial statements”) of FW Thorpe Plc for the year ended 
30 June 2012 which comprise the consolidated income statement, consolidated statement of comprehensive income, consolidated 
and company balance sheets, consolidated and company statement of changes in equity, consolidated and company statements 
of cash flows and the related notes. The financial reporting framework that has been applied in their preparation is applicable law 
and International Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards the parent company 
financial statements, as applied in accordance with the provisions of the Companies Act 2006. 

Respective responsibilities of directors and auditors 
As explained more fully in the statement of directors’ responsibilities set out on page 25, 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. 

This report, including the opinions, has been prepared for and only for the company’s members as a body in accordance with Chapter 3 
of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for 
any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed 
by our prior consent in writing. 

Scope of the audit of the financial statements 
An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable 
assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an 
assessment of: whether the accounting policies are appropriate to the group’s and parent company’s circumstances and have been 
consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the directors; and the 
overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the Annual Report 
and Accounts to identify material inconsistencies with the audited financial statements. If we become aware of any apparent material 
misstatements or inconsistencies we consider the implications for our report. 

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 30 June 2012 

and of the group’s profit and group’s and parent company’s cash flows for the year then ended; 

•  the group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;  

•  the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union 

and as applied in accordance with the provisions of the Companies Act 2006; and 

•  the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.  

Opinion on other matters prescribed by the Companies Act 2006 
In our opinion the information given in the report of the directors 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. 

Andrew Hammond (Senior Statutory Auditor)  
for and on behalf of PricewaterhouseCoopers LLP 

Chartered Accountants and Statutory Auditors 
Birmingham 

12 October 2012 

015702_FW_Thorpe_18-68.indd   26

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INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF 

GOVERNANCE 

FW THORPE PLC 

ACCOUNTS 
CONSOLIDATED INCOME STATEMENT 

FOR THE YEAR ENDED 30 JUNE 2012 

Continuing operations 
Revenue 
Cost of sales 

Gross profit 
Distribution costs 
Administrative expenses 

Operating profit 
Net finance income 
Share of loss of joint venture 

Profit before income tax 
Income tax expense 

Profit for the year from continuing operations 

Profit for the year from discontinued operations* 

Profit for the year 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

27

Note 

2012
£’000

2011
£’000

2 

55,559
(30,674)

52,833
(29,635)

3 

6 

32 

7 

24,885
(4,128)
(8,907)

11,850
831
(23)

12,658
(2,718)

9,940

1,377

23,198
(3,994)
(7,952)

11,252
372
(11)

11,613
(3,201)

8,412

999

11,317

9,411

*Profit for the year from discontinued operations in 2012 includes the exceptional item of profit on sale from disposal of a subsidiary.  There is no other income from discontinued 
operations. 

Earnings per share from continuing and discontinued operations attributable to the equity holders of the company during the 
year (expressed in pence per share). 

Basic and diluted earnings per share 

– Basic 

– Diluted 

– Basic 

– Diluted 

– Basic 

– Diluted 

Continuing operations

Continuing operations

Discontinued operations

Discontinued operations

Total

Total

Note 

23 

23 

23 

23 

23 

23 

2012 
pence

84.8

84.8

11.7

11.7

96.5

96.5

2011 
pence

71.8

71.8

8.5

8.5

80.3

80.3

The notes on pages 33 to 64 are an integral part of these consolidated financial statements and parent company financial statements. 

The company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the parent company 
income statement. 

The profit for the parent company for the year was £16,525,000 (2011: £8,376,000) inclusive of exceptional profit on disposal of Mackwell 
Electronics Limited amounting to £5,578,000. 

We have audited the group and parent company financial statements (the “financial statements”) of FW Thorpe Plc for the year ended 

30 June 2012 which comprise the consolidated income statement, consolidated statement of comprehensive income, consolidated 

and company balance sheets, consolidated and company statement of changes in equity, consolidated and company statements 

of cash flows and the related notes. The financial reporting framework that has been applied in their preparation is applicable law 

and International Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards the parent company 

financial statements, as applied in accordance with the provisions of the Companies Act 2006. 

Respective responsibilities of directors and auditors 

As explained more fully in the statement of directors’ responsibilities set out on page 25, 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. 

This report, including the opinions, has been prepared for and only for the company’s members as a body in accordance with Chapter 3 

of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for 

any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed 

by our prior consent in writing. 

Scope of the audit of the financial statements 

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable 

assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an 

assessment of: whether the accounting policies are appropriate to the group’s and parent company’s circumstances and have been 

consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the directors; and the 

overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the Annual Report 

and Accounts to identify material inconsistencies with the audited financial statements. If we become aware of any apparent material 

misstatements or inconsistencies we consider the implications for our report. 

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 30 June 2012 

and of the group’s profit and group’s and parent company’s cash flows for the year then ended; 

•  the group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;  

•  the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union 

and as applied in accordance with the provisions of the Companies Act 2006; and 

•  the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.  

Opinion on other matters prescribed by the Companies Act 2006 

In our opinion the information given in the report of the directors 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 

in our opinion: 

from branches not visited by us; or 

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you, if, 

•  adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received 

•  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. 

Andrew Hammond (Senior Statutory Auditor)  

for and on behalf of PricewaterhouseCoopers LLP 

Chartered Accountants and Statutory Auditors 

Birmingham 

12 October 2012 

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28

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 

FOR THE YEAR ENDED 30 JUNE 2012 

ACCOUNTS 

AS AT 30 JUNE 2012 

CONSOLIDATED AND COMPANY BALANCE SHEETS 

Profit for the year: 

Other comprehensive income 
Actuarial (loss)/gain on pension scheme 
Movement on unrecognised pension scheme surplus 
Movement on associated deferred tax asset relating to the pension scheme 
Revaluation of available-for-sale financial assets 
Movement on associated deferred tax 
Impact of deferred tax rate change 
Exchange rate movement on investment in joint venture 

Other comprehensive income for the year, net of tax 

Total comprehensive income for the year 

Total comprehensive income attributable to equity shareholders arises from: 
 – Continuing operations 
 – Discontinued operations 

Note 

2012
£’000

2011
£’000

11,317

9,411

30 

30 

22 

22 

22 

(1,410)
468
–
29
(8)
56
(2)

1,054
(483)
(148)
37
(10)
(24)
(9)

(867)

417

10,450

9,828

9,073
1,377

10,450

8,829
999

9,828

All comprehensive income is attributable to the owners of the company. 

The notes on pages 33 to 64 are an integral part of these consolidated financial statements and parent company financial statements. 

Other financial assets at fair value through profit or loss 

Short-term financial assets – deposits 

Cash and cash equivalents 

Total current assets (excluding non-current assets and disposal groups 

held for sale) 

Non-current assets and disposal groups held for sale 

Total current liabilities (excluding liabilities directly associated with  

non-current assets and disposal groups for sale) 

Liabilities directly associated with non-current assets and disposal groups 

Assets 

Non-current assets 

Property, plant and equipment 

Intangible assets 

Investment in subsidiaries 

Investment property 

Loans and receivables 

Investment in joint venture 

Available-for-sale financial assets 

Deferred tax assets 

Current assets 

Inventories 

Trade and other receivables 

Total assets 

Liabilities 

Current liabilities 

Trade and other payables 

Current tax liabilities 

held for resale 

Total current liabilities 

Net current assets 

Non-current liabilities  

Retirement benefit deficit 

Provisions for liabilities and charges 

Deferred tax liabilities 

Total liabilities 

Net assets 

Called up share capital 

Share premium account 

Capital redemption reserve 

Retained earnings 

Total equity 

Equity attributable to owners of the company 

Group 

2012

£’000

Company 

2011 

£’000 

2012

£’000

2011

£’000

Note

10

9

31

13

29

32

14

22

17

18

19

15

16

29

20

29

30

21

22

24

25

25

23,064

15,947 

23,067

15,830

11,204

5,984

–

2,081

1,828

111

1,841

15

11,144

10,942

387

17,108

14,120

53,701

–

53,701

11,109 

2,533 

– 

– 

1,037 

136 

1,105 

27 

11,297 

11,377 

387 

11,616 

14,236 

48,913 

5,823 

54,736 

10,491

2,502

4,168

2,081

1,828

156

1,841

–

9,257

11,042

387

17,108

14,081

10,429

2,014

1,008

1,037

–

156

1,105

81

9,149

12,116

387

11,616

14,260

51,875

47,528

–

–

51,875

47,528

76,765

70,683 

74,942

63,358

(7,677)

(1,395)

(8,199) 

(1,564) 

(8,696)

(1,121)

(10,235)

(1,486)

(9,072)

(9,763) 

(9,817)

(11,721)

–

(9,072)

(1,634) 

(11,397) 

–

–

(9,817)

(11,721)

44,629

43,339 

42,058

35,807

–

(102)

(778)

– 

(102) 

(699) 

–

(102)

(723)

–

(102)

(769)

(9,952)

(12,198) 

(10,642)

(12,592)

66,813

58,485 

64,300

50,766

1,189

656

137

1,189 

656 

137 

1,189

656

137

64,831

56,503 

62,318

1,189

656

137

48,784

66,813

58,485 

64,300

50,766

The notes on pages 33 to 64 form part of these financial statements. 

The financial statements on pages 27 to 64 were approved by the Board on 12 October 2012 and signed on its behalf by 

A B Thorpe 

  C Muncaster 

Company Registration Number: 317886 

015702_FW_Thorpe_18-68.indd   28

10/10/2012   15:49

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ACCOUNTS 

FOR THE YEAR ENDED 30 JUNE 2012 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 

ACCOUNTS 
CONSOLIDATED AND COMPANY BALANCE SHEETS 

AS AT 30 JUNE 2012 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

29

Profit for the year: 

Other comprehensive income 

Actuarial (loss)/gain on pension scheme 

Movement on unrecognised pension scheme surplus 

Movement on associated deferred tax asset relating to the pension scheme 

Revaluation of available-for-sale financial assets 

Movement on associated deferred tax 

Impact of deferred tax rate change 

Exchange rate movement on investment in joint venture 

Other comprehensive income for the year, net of tax 

Total comprehensive income for the year 

Total comprehensive income attributable to equity shareholders arises from: 

 – Continuing operations 

 – Discontinued operations 

All comprehensive income is attributable to the owners of the company. 

Note 

2012

£’000

2011

£’000

11,317

9,411

30 

30 

22 

22 

22 

(1,410)

468

–

29

(8)

56

(2)

(867)

1,054

(483)

(148)

37

(10)

(24)

(9)

417

10,450

9,828

9,073

1,377

10,450

8,829

999

9,828

Assets 
Non-current assets 
Property, plant and equipment 
Intangible assets 
Investment in subsidiaries 
Investment property 
Loans and receivables 
Investment in joint venture 
Available-for-sale financial assets 
Deferred tax assets 

Current assets 
Inventories 
Trade and other receivables 
Other financial assets at fair value through profit or loss 
Short-term financial assets – deposits 
Cash and cash equivalents 
Total current assets (excluding non-current assets and disposal groups 
held for sale) 
Non-current assets and disposal groups held for sale 

The notes on pages 33 to 64 are an integral part of these consolidated financial statements and parent company financial statements. 

Total assets 

Liabilities 
Current liabilities 
Trade and other payables 
Current tax liabilities 
Total current liabilities (excluding liabilities directly associated with  
non-current assets and disposal groups for sale) 
Liabilities directly associated with non-current assets and disposal groups 
held for resale 
Total current liabilities 

Net current assets 

Non-current liabilities  
Retirement benefit deficit 
Provisions for liabilities and charges 
Deferred tax liabilities 

Total liabilities 

Net assets 

Equity attributable to owners of the company 
Called up share capital 
Share premium account 
Capital redemption reserve 
Retained earnings 

Total equity 

Group 

2012
£’000

2011 
£’000 

Company 
2012
£’000

2011
£’000

Note

10
9
31
13
29
32
14
22

17
18
19
15
16

29

20

29

30
21
22

24
25
25

11,204
5,984
–
2,081
1,828
111
1,841
15
23,064

11,144
10,942
387
17,108
14,120

53,701
–
53,701

11,109 
2,533 
– 
1,037 
– 
136 
1,105 
27 
15,947 

11,297 
11,377 
387 
11,616 
14,236 

48,913 
5,823 
54,736 

10,491
2,502
4,168
2,081
1,828
156
1,841
–
23,067

9,257
11,042
387
17,108
14,081

51,875
–
51,875

10,429
2,014
1,008
1,037
–
156
1,105
81
15,830

9,149
12,116
387
11,616
14,260

47,528
–
47,528

76,765

70,683 

74,942

63,358

(7,677)
(1,395)

(8,199) 
(1,564) 

(8,696)
(1,121)

(10,235)
(1,486)

(9,072)

(9,763) 

(9,817)

(11,721)

–
(9,072)

(1,634) 
(11,397) 

–
(9,817)

–
(11,721)

44,629

43,339 

42,058

35,807

–
(102)
(778)

– 
(102) 
(699) 

–
(102)
(723)

–
(102)
(769)

(9,952)

(12,198) 

(10,642)

(12,592)

66,813

58,485 

64,300

50,766

1,189
656
137
64,831

1,189 
656 
137 
56,503 

1,189
656
137
62,318

1,189
656
137
48,784

66,813

58,485 

64,300

50,766

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The notes on pages 33 to 64 form part of these financial statements. 

The financial statements on pages 27 to 64 were approved by the Board on 12 October 2012 and signed on its behalf by 

A B Thorpe 

  C Muncaster 

Company Registration Number: 317886 

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30

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 

FOR THE YEAR ENDED 30 JUNE 2012 

ACCOUNTS 

COMPANY STATEMENT OF CHANGES IN EQUITY 

FOR THE YEAR ENDED 30 JUNE 2012 

Balance at 1 July 2010 
Comprehensive income 
Profit for the year to 30 June 2011 
Actuarial gain on pension scheme 
Movement on unrecognised pension scheme surplus 
Movement on associated deferred tax asset relating to the 
pension scheme 
Revaluation of available-for-sale financial assets 
Movement on associated deferred tax 
Impact of deferred tax rate change 
Exchange rate movement on joint venture 
Total comprehensive income 
Transactions with owners 
Dividends paid to shareholders 
Total transactions with owners 
Balance at 30 June 2011 
Comprehensive income 
Profit for the year to 30 June 2012 
Actuarial loss on pension scheme 
Movement on unrecognised pension scheme surplus 
Revaluation of available-for-sale financial assets 
Movement on associated deferred tax 
Impact of deferred tax rate change 
Exchange rate movement on joint venture 
Total comprehensive income 
Transactions with owners 
Dividends paid to shareholders 
Total transactions with owners 
Balance at 30 June 2012 

The notes on pages 33 to 64 form part of these financial statements. 

Note

Share 
capital 
£’000

1,189

Share 
premium 
£’000

Capital  
redemption  
reserve  
£’000 

Retained 
earnings 
£’000

Total 
equity 
£’000

656

137 

48,656

50,638

30
30

22
22

30
30

22
22

–
–
–

–
–
–
–
–
–

–
–
–

–
–
–
–
–
–

– 
– 
– 

– 
– 
– 
– 
– 
– 

9,411
1,054
(483)

(148)
37
(10)
(24)
(9)
9,828

9,411
1,054
(483)

(148)
37
(10)
(24)
(9)
9,828

–
–
1,189

–
–
656

– 
– 
137 

(1,981)
(1,981)
56,503

(1,981)
(1,981)
58,485

–
–
–
–
–
–
–
–

–
–
–
–
–
–
–
–

– 
– 
– 
– 
– 
– 
– 
– 

11,317
(1,410)
468
29
(8)
56
(2)
10,450

11,317
(1,410)
468
29
(8)
56
(2)
10,450

–
–
1,189

–
–
656

– 
– 
137 

(2,122)
(2,122)
64,831

(2,122)
(2,122)
66,813

Balance at 1 July 2010 

Comprehensive income 

Profit for the year to 30 June 2011 

Actuarial gain on pension scheme 

Movement on unrecognised pension scheme surplus 

Movement on associated deferred tax asset relating to the 

pension scheme 

Revaluation of available-for-sale financial assets 

Movement on associated deferred tax 

Impact of deferred tax rate change 

Exchange rate movement on joint venture 

Total comprehensive income 

Transactions with owners 

Dividends paid to shareholders 

Total transactions with owners 

Balance at 30 June 2011 

Comprehensive income 

Profit for the year to 30 June 2012 

Actuarial loss on pension scheme 

Movement on unrecognised pension scheme surplus 

Revaluation of available-for-sale financial assets 

Movement on associated deferred tax 

Impact of deferred tax rate change 

Total comprehensive income 

Transactions with owners 

Dividends paid to shareholders 

Total transactions with owners 

Balance at 30 June 2012 

Note

Share 

capital 

£’000

1,189

Share 

redemption  

Capital  

reserve  

£’000 

premium 

£’000

Retained 

earnings 

£’000

Total 

equity 

£’000

656

137 

41,937

43,919

30

30

22

22

30

30

22

22

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

8,376

1,054

(483)

(148)

37

(10)

11

(9)

8,376

1,054

(483)

(148)

37

(10)

11

(9)

8,828

8,828

(1,981)

(1,981)

(1,981)

(1,981)

16,525

(1,410)

468

29

(8)

52

16,525

(1,410)

468

29

(8)

52

15,656

15,656

(2,122)

(2,122)

(2,122)

(2,122)

1,189

656

137 

48,784

50,766

The notes on pages 33 to 64 form part of these financial statements. 

1,189

656

137 

62,318

64,300

015702_FW_Thorpe_18-68.indd   30

10/10/2012   15:49

 
 
 
 
 
 
 
 
 
 
 
 
 
 
ACCOUNTS 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 

FOR THE YEAR ENDED 30 JUNE 2012 

ACCOUNTS 
COMPANY STATEMENT OF CHANGES IN EQUITY 

FOR THE YEAR ENDED 30 JUNE 2012 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

31

Balance at 1 July 2010 

Comprehensive income 

Profit for the year to 30 June 2011 

Actuarial gain on pension scheme 

Movement on unrecognised pension scheme surplus 

Movement on associated deferred tax asset relating to the 

pension scheme 

Revaluation of available-for-sale financial assets 

Movement on associated deferred tax 

Impact of deferred tax rate change 

Exchange rate movement on joint venture 

Total comprehensive income 

Transactions with owners 

Dividends paid to shareholders 

Total transactions with owners 

Balance at 30 June 2011 

Comprehensive income 

Profit for the year to 30 June 2012 

Actuarial loss on pension scheme 

Movement on unrecognised pension scheme surplus 

Revaluation of available-for-sale financial assets 

Movement on associated deferred tax 

Impact of deferred tax rate change 

Exchange rate movement on joint venture 

Total comprehensive income 

Transactions with owners 

Dividends paid to shareholders 

Total transactions with owners 

Balance at 30 June 2012 

Note

Share 

capital 

£’000

1,189

Share 

redemption  

Capital  

reserve  

£’000 

premium 

£’000

Retained 

earnings 

£’000

Total 

equity 

£’000

656

137 

48,656

50,638

30

30

22

22

30

30

22

22

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

9,411

1,054

(483)

(148)

37

(10)

(24)

(9)

9,411

1,054

(483)

(148)

37

(10)

(24)

(9)

9,828

9,828

(1,981)

(1,981)

(1,981)

(1,981)

11,317

(1,410)

468

11,317

(1,410)

468

29

(8)

56

(2)

29

(8)

56

(2)

10,450

10,450

(2,122)

(2,122)

(2,122)

(2,122)

1,189

656

137 

56,503

58,485

Balance at 1 July 2010 
Comprehensive income 
Profit for the year to 30 June 2011 
Actuarial gain on pension scheme 
Movement on unrecognised pension scheme surplus 
Movement on associated deferred tax asset relating to the 
pension scheme 
Revaluation of available-for-sale financial assets 
Movement on associated deferred tax 
Impact of deferred tax rate change 
Exchange rate movement on joint venture 
Total comprehensive income 
Transactions with owners 
Dividends paid to shareholders 
Total transactions with owners 
Balance at 30 June 2011 
Comprehensive income 
Profit for the year to 30 June 2012 
Actuarial loss on pension scheme 
Movement on unrecognised pension scheme surplus 
Revaluation of available-for-sale financial assets 
Movement on associated deferred tax 
Impact of deferred tax rate change 
Total comprehensive income 
Transactions with owners 
Dividends paid to shareholders 
Total transactions with owners 
Balance at 30 June 2012 

Note

Share 
capital 
£’000

1,189

Share 
premium 
£’000

Capital  
redemption  
reserve  
£’000 

Retained 
earnings 
£’000

Total 
equity 
£’000

656

137 

41,937

43,919

30
30

22
22

30
30

22
22

–
–
–

–
–
–
–
–
–

–
–
–

–
–
–
–
–
–

– 
– 
– 

– 
– 
– 
– 
– 
– 

8,376
1,054
(483)

(148)
37
(10)
11
(9)
8,828

8,376
1,054
(483)

(148)
37
(10)
11
(9)
8,828

–
–
1,189

–
–
656

– 
– 
137 

(1,981)
(1,981)
48,784

(1,981)
(1,981)
50,766

–
–
–
–
–
–
–

–
–
–
–
–
–
–

– 
– 
– 
– 
– 
– 
– 

16,525
(1,410)
468
29
(8)
52
15,656

16,525
(1,410)
468
29
(8)
52
15,656

–
–
1,189

–
–
656

– 
– 
137 

(2,122)
(2,122)
62,318

(2,122)
(2,122)
64,300

The notes on pages 33 to 64 form part of these financial statements. 

1,189

656

137 

64,831

66,813

The notes on pages 33 to 64 form part of these financial statements. 

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32

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
CONSOLIDATED AND COMPANY STATEMENTS OF CASH FLOWS 

FOR THE YEAR ENDED 30 JUNE 2012 

ACCOUNTS 

FOR THE YEAR ENDED 30 JUNE 2012 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 

Cash flows from operating activities 
Cash generated from operations 
Tax paid 
Net cash generated from operating activities 

Cash flows from investing activities 
Purchases of property, plant and equipment 
Proceeds from sale of property, plant and equipment 
Purchase of intangibles  
Purchase of subsidiary (net of cash acquired) 
Purchase of investment property 
Purchase of available-for-sale financial assets 
Property rental and similar income 
Dividend income 
Net (purchase)/sale of deposits 
Interest received 
Proceeds of disposal of subsidiary net of loan notes issued and direct costs 
Net cash (outflow)/inflow from investing activities 

Cash flows from financing activities 
Dividends paid to company’s shareholders 
Net cash outflow from financing activities 
Net (decrease)/increase in cash in the year 
Cash and cash equivalents at beginning of year 
Cash and cash equivalents at end of year 

Discontinued operations (note 29) 

Net cash generated from operating activities 
Net cash outflow from investing activities 
Net cash outflow from financing activities 
Cash and cash equivalents at the end of the year 

Note

26

Group 

2012
£’000

2011 
£’000 

Company 
2012
£’000

2011
£’000

12,691
(3,223)
9,468

9,861 
(2,901) 
6,960 

10,298
(2,808)
7,490

(2,198)
120
(1,341)
(2,502)
(35)
(706)
195
69
(5,492)
322
4,106
(7,462)

(2,122)
(2,122)
(116)
14,236
14,120

(2,209) 
112 
(1,116) 
– 
(31) 
(990) 
65 
– 
4,442 
230 
– 
503 

(1,993)
85
(1,259)
(2,734)
(35)
(706)
390
1,769
(5,492)
322
4,106
(5,547)

(1,981) 
(1,981) 
5,482 
8,754 
14,236 

(2,122)
(2,122)
(179)
14,260
14,081

2012 
£’000

(8)
–
–
–

7,800
(2,570)
5,230

(1,459)
88
(908)
–
(31)
(990)
359
507
4,442
233
–
2,241

(1,981)
(1,981)
5,490
8,770
14,260

2011
£’000

756
(366)
(282)
(101)

The notes on pages 33 to 64 are an integral part of these consolidated financial statements and parent company financial statements.  

•  Amendments to IAS 32 “Financial Instruments: Presentation – Offsetting Financial Assets and Financial Liabilities”  

1 Accounting policies 

The principal accounting policies applied in the preparation of these consolidated financial statements and parent company financial 

statements are set out below. These policies have been consistently applied to all years presented, unless otherwise stated. 

FW Thorpe Plc is incorporated in England and Wales. The company is domiciled in the UK. The company is a public limited company 

which is listed on the Alternative Investment Market and is incorporated and domiciled in the UK. The address of its registered office 

is Merse Road, North Moons Moat, Redditch, Worcestershire B98 9HH. 

Basis of preparation 

The consolidated financial statements of FW Thorpe Plc have been prepared in accordance with International Financial Reporting 

Standards as adopted by the European Union (IFRSs as adopted by the EU), IFRIC interpretations and the Companies Act 2006 applicable 

to Companies reporting under IFRS. The financial statements have been prepared on a going concern basis, under the historical cost 

convention, as modified by available-for-sale financial assets, financial assets and financial liabilities (including derivative instruments) 

at fair value through the profit and loss.  

The company and group has adopted all IAS and IFRS adopted in the EU except for IAS 34, as AIM-listed companies are not required 

to adopt IAS 34. The company and group has not early adopted any other standards or interpretations not yet endorsed by the EU. 

The group has not yet adopted certain new standards, amendments and interpretations to existing standards, which have been 

published but are only effective for our accounting periods beginning on or after 1 July 2012 or later periods. These new pronouncements 

are listed below: 

(effective 1 July 2012) 

•  Amendments to IAS 12 “Income Taxes: Deferred Tax – Recovery of Underlying Assets” (effective 1 January 2012) 

•  Amendments to IAS 1 “Presentation of Financial Statements – Presentation of Items of Other Comprehensive Income” 

•  IFRS 10 “Consolidated Financial Statements” (effective 1 January 2013) 

•  IFRS 11 “Joint Arrangements” (effective 1 January 2013) 

•  IFRS 12 “Disclosure of Interests in Other Entities” (effective 1 January 2013) 

•  IFRS 13 “Fair Value Measurement” (effective 1 January 2013) 

•  Amendment to IAS 19 “Employee Benefits” (effective 1 January 2013) 

•  Amendment to IAS 27 “Separate Financial Statements” (effective 1 January 2013) 

•  Amendment to IAS 28 “Investments in Associates and Joint Ventures” (effective 1 January 2013) 

•  Amendment to IFRS 7 “Financial Instruments: Disclosures – Offsetting Financial Assets and Financial Liabilities”  

(effective 1 January 2013) 

•  Annual Improvements 2009-2011 Cycle (effective 1 January 2013) 

(effective 1 January 2014) 

•  IFRS 9 “Financial Instruments” (effective 1 January 2015) 

The directors are currently evaluating the impact of the adoption of these standards, amendments and interpretations in future periods. 

The company has adopted the following new and amended standards as of 1 July 2011. 

IAS 12 (amendment) 

“Income taxes” on deferred tax – effective from annual periods beginning on or after  

IFRIC 14 and 

IAS 19 

IAS 24 (revised) 

IFRS 1 (amendment) 

1 January 2012 

on or after 1 January 2011 

after 1 July 2011. 

Prepayments of a minimum funding requirement – effective from annual periods beginning 

Related party disclosures – effective from annual periods beginning on or after 1 January 2011  

 First time adoption, on hyperinflation and fixed dates – effective from annual periods beginning on or 

Annual improvements 2010  

Effective from annual periods beginning on or after 1 January 2011. 

The adoption of these accounting standards did not have a material impact on the company’s financial statements. 

015702_FW_Thorpe_18-68.indd   32

10/10/2012   15:49

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
 
 
 
 
 
FW Thorpe Plc
Annual	Report	and	Accounts	2012

33

ACCOUNTS 

FOR THE YEAR ENDED 30 JUNE 2012 

CONSOLIDATED AND COMPANY STATEMENTS OF CASH FLOWS 

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 

FOR THE YEAR ENDED 30 JUNE 2012 

Cash flows from operating activities 

Cash generated from operations 

Tax paid 

Net cash generated from operating activities 

Cash flows from investing activities 

Purchases of property, plant and equipment 

Proceeds from sale of property, plant and equipment 

Purchase of intangibles  

Purchase of subsidiary (net of cash acquired) 

Purchase of investment property 

Purchase of available-for-sale financial assets 

Property rental and similar income 

Dividend income 

Net (purchase)/sale of deposits 

Interest received 

Cash flows from financing activities 

Dividends paid to company’s shareholders 

Net cash outflow from financing activities 

Net (decrease)/increase in cash in the year 

Cash and cash equivalents at beginning of year 

Cash and cash equivalents at end of year 

Discontinued operations (note 29) 

Net cash generated from operating activities 

Net cash outflow from investing activities 

Net cash outflow from financing activities 

Cash and cash equivalents at the end of the year 

Proceeds of disposal of subsidiary net of loan notes issued and direct costs 

Net cash (outflow)/inflow from investing activities 

Note

26

Group 

2012

£’000

2011 

£’000 

Company 

2012

£’000

2011

£’000

12,691

(3,223)

9,468

9,861 

(2,901) 

6,960 

10,298

(2,808)

7,490

7,800

(2,570)

5,230

(2,198)

120

(1,341)

(2,502)

(35)

(706)

195

69

(5,492)

322

4,106

(7,462)

(2,122)

(2,122)

(116)

14,236

14,120

(2,209) 

(1,993)

(1,459)

112 

(1,116) 

– 

(31) 

(990) 

65 

– 

4,442 

230 

– 

503 

85

(1,259)

(2,734)

(35)

(706)

390

1,769

(5,492)

322

4,106

(5,547)

88

(908)

–

(31)

(990)

359

507

4,442

233

–

2,241

(1,981) 

(1,981) 

5,482 

8,754 

14,236 

(2,122)

(2,122)

(179)

14,260

14,081

(1,981)

(1,981)

5,490

8,770

14,260

2012 

£’000

(8)

–

–

–

2011

£’000

756

(366)

(282)

(101)

1 Accounting policies 
The principal accounting policies applied in the preparation of these consolidated financial statements and parent company financial 
statements are set out below. These policies have been consistently applied to all years presented, unless otherwise stated. 

FW Thorpe Plc is incorporated in England and Wales. The company is domiciled in the UK. The company is a public limited company 
which is listed on the Alternative Investment Market and is incorporated and domiciled in the UK. The address of its registered office 
is Merse Road, North Moons Moat, Redditch, Worcestershire B98 9HH. 

Basis of preparation 
The consolidated financial statements of FW Thorpe Plc have been prepared in accordance with International Financial Reporting 
Standards as adopted by the European Union (IFRSs as adopted by the EU), IFRIC interpretations and the Companies Act 2006 applicable 
to Companies reporting under IFRS. The financial statements have been prepared on a going concern basis, under the historical cost 
convention, as modified by available-for-sale financial assets, financial assets and financial liabilities (including derivative instruments) 
at fair value through the profit and loss.  

The company and group has adopted all IAS and IFRS adopted in the EU except for IAS 34, as AIM-listed companies are not required 
to adopt IAS 34. The company and group has not early adopted any other standards or interpretations not yet endorsed by the EU. 

The group has not yet adopted certain new standards, amendments and interpretations to existing standards, which have been 
published but are only effective for our accounting periods beginning on or after 1 July 2012 or later periods. These new pronouncements 
are listed below: 

•  Amendments to IAS 12 “Income Taxes: Deferred Tax – Recovery of Underlying Assets” (effective 1 January 2012) 

•  Amendments to IAS 1 “Presentation of Financial Statements – Presentation of Items of Other Comprehensive Income” 

(effective 1 July 2012) 

•  IFRS 10 “Consolidated Financial Statements” (effective 1 January 2013) 

•  IFRS 11 “Joint Arrangements” (effective 1 January 2013) 

•  IFRS 12 “Disclosure of Interests in Other Entities” (effective 1 January 2013) 

•  IFRS 13 “Fair Value Measurement” (effective 1 January 2013) 

•  Amendment to IAS 19 “Employee Benefits” (effective 1 January 2013) 

•  Amendment to IAS 27 “Separate Financial Statements” (effective 1 January 2013) 

•  Amendment to IAS 28 “Investments in Associates and Joint Ventures” (effective 1 January 2013) 

•  Amendment to IFRS 7 “Financial Instruments: Disclosures – Offsetting Financial Assets and Financial Liabilities”  

(effective 1 January 2013) 

•  Annual Improvements 2009-2011 Cycle (effective 1 January 2013) 

The notes on pages 33 to 64 are an integral part of these consolidated financial statements and parent company financial statements.  

•  Amendments to IAS 32 “Financial Instruments: Presentation – Offsetting Financial Assets and Financial Liabilities”  

(effective 1 January 2014) 

•  IFRS 9 “Financial Instruments” (effective 1 January 2015) 

The directors are currently evaluating the impact of the adoption of these standards, amendments and interpretations in future periods. 

The company has adopted the following new and amended standards as of 1 July 2011. 

IAS 12 (amendment) 

IFRIC 14 and 
IAS 19 
IAS 24 (revised) 
IFRS 1 (amendment) 

Annual improvements 2010  

“Income taxes” on deferred tax – effective from annual periods beginning on or after  
1 January 2012 
Prepayments of a minimum funding requirement – effective from annual periods beginning 
on or after 1 January 2011 
Related party disclosures – effective from annual periods beginning on or after 1 January 2011  
 First time adoption, on hyperinflation and fixed dates – effective from annual periods beginning on or 
after 1 July 2011. 
Effective from annual periods beginning on or after 1 January 2011. 

The adoption of these accounting standards did not have a material impact on the company’s financial statements. 

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34

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ACCOUNTS 

1 Accounting policies continued 
The preparation of financial information in conformity with the basis of preparation described above requires the use of certain critical 
accounting estimates. It also requires management to exercise its judgement in the process of applying the company’s and group’s 
accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are 
significant to the consolidated financial information are disclosed in the critical accounting estimates and judgements section. 

Basis of consolidation 
The financial statements for FW Thorpe Plc incorporate the financial statements of the company and its subsidiary undertakings. 
A subsidiary is a company controlled directly by the group and all the subsidiaries are wholly owned by the group. The group achieves 
control over the subsidiaries by being able to influence financial and operating policies so as to obtain benefits from their activities. 

Intra-group transactions, balances, income and expenses are eliminated in preparing consolidated financial statements. 

•  For members joining post-1 October 1995, benefits provided are defined contribution in nature (the “pure defined contribution” 

Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. 

Joint venture 
Joint ventures are all entities over which the group exercised joint control. Investments in joint ventures are accounted for by the equity 
method of accounting and are initially recognised at cost. 

The group discloses its share of the revenue and the operating profits on the face of the income statement. The group also discloses its 
share of the gross assets and liabilities on the face of the balance sheet. 

The carrying amount of an investment in a joint venture is tested for impairment by comparing its recoverable amount with its carrying 
amount whenever there is an indication that the investment may be impaired. 

Revenue recognition 
The group recognises revenue when the amount of revenue can be reliably measured; it is probable that future economic benefits will 
flow to the entity and when specific criteria have been met for each of the group’s activities. The amount of revenue is not considered to 
be reliably measurable until all contingencies relating to the sale have been resolved. The group bases its estimates on historical results, 
taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. Revenue is subsequently 
recognised based upon the goods and services provided, when these goods have been delivered to the customer or the service 
performed, excluding VAT and trade discounts. 

Interest income 
Interest income is recognised on a time proportion basis using the effective interest method. When a receivable is impaired the group 
reduces the carrying amount to its recoverable amount, being the estimated cash flow discounted at the original effective interest rate 
of the instrument and continues unwinding the discount as interest income. 

Interest on impaired loans is recognised using the original effective interest rate.  

Dividend income 
Dividend income is recognised when the right to receive payment is established. 

Segment reporting 
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. 
The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, 
it is identified as the group Board that makes strategic decisions. 

The group is organised into six operating segments based on the products and customer base in the lighting market. The largest business 
is Thorlux. The five remaining operating segments have been aggregated into the “other companies” reportable segment based upon 
their size, comprising the entities Compact Lighting, Philip Payne, Sugg Lighting, Solite Europe and Portland Lighting. 

015702_FW_Thorpe_18-68.indd   34

10/10/2012   15:49

1 Accounting policies continued 

Pension costs 

The group operates a hybrid defined benefit and defined contribution pension scheme. The basis of the groups’ hybrid pension scheme 

provides benefits to members based upon the following: 

•  Service before 1 October 1995, benefits provided are defined benefit in nature (the ”pure“ defined benefit element); 

•  Service after 1 October 1995 has two elements; 

•  For members joining pre-1 October 1995, benefits provided are the maximum of their defined contribution pension and their defined 

benefit pension (the ”defined benefit underpin“ element); 

element). 

The contributions of all three elements are paid into one pension scheme, where the contributions and assets are segregated and ring-

fenced from each other. The assets of the scheme are invested and managed independently of the finances of the group. Pension costs 

are assessed in accordance with the advice of an independent qualified actuary. Costs include the regular cost of providing benefits which 

it is intended should remain at a substantially level percentage of current and expected future earnings of the employees covered. 

Variations from the regular pensions cost are spread evenly through the income over the remaining service lives of current employees. 

Contributions made to the defined benefit scheme are charged to the income statement in the period in which they are made. 

The liability recognised in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit 

obligation at the balance sheet date less the fair value of plan assets, together with adjustments for unrecognised past-service costs. 

The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. In the defined 

benefit underpin element of the scheme the liabilities reflect the greater of the defined contribution or defined benefit liabilities. 

For the defined benefit underpin element of the scheme each member is tested to see whether the pension on a defined contribution 

or defined benefit basis is higher. The liabilities shown in the pensions note are based on the greater of the two liabilities for each member, 

which in almost all cases is the defined benefit liability. For the service cost, again tests are performed to see which is the higher for each 

member out of the company’s share of the defined contribution payments or the company’s share of accruing benefits on a defined 

benefit basis. The higher of these two figures for each member is then used to give the total service cost; again the defined benefit cost 

is the higher for the vast majority of members. 

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates 

of high quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity 

approximating to the terms of the related pension liability. 

Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to equity 

in the statement of comprehensive income in the period in which they arise. 

Past service costs are recognised immediately in income, unless the changes to the pension plan are conditional on the employees 

remaining in service for a specified period of time (the vesting period). In this case, the past-service costs are amortised on a straight-line 

basis over the vesting period.  

For defined contribution plans and pure defined contribution elements, the group pays contributions to publicly or privately 

administered pension insurance plans on a mandatory, contractual or voluntary basis. The group has no further payment obligations 

once the contributions have been paid. The contributions are recognised as employee benefit expense in the income statement as they 

fall due, or as an accrued or prepaid expense. Prepaid contributions are recognised as an asset to the extent that a cash refund or a 

reduction in the future payments is available. A defined benefit surplus is only recognised if it meets the following criteria; if the group 

has an unconditional right to a refund; or if the group can realise it at some point during the life of the plan or when the plan liabilities 

are settled. If the criteria are not met then a defined benefit surplus is not recognised. 

Foreign currencies 

Transactions in foreign currency are converted to sterling using the exchange rate applicable to the date of the transaction. Foreign 

currency gains and losses resulting from the settlement of foreign currency transactions at a different time are recognised in the income 

statement. Currency exchange differences arising from holding monetary assets or liabilities in a foreign currency are fair valued at the 

balance sheet date in accordance with prevailing exchange rates and resulting gains or losses are recognised in the income statement. 

The results of joint ventures and financial position of the joint ventures (which does not have the currency of a hyper-inflationary 

economy) that has a functional currency different from the presentational currency is translated into presentational currency as follows; 

assets and liabilities for the balance sheet presented are translated at the closing rate at the date of the balance sheet; and income and 

expenses for the income statement are translated at average exchange rates. All resulting exchange differences are recognised in other 

comprehensive income. 

 
 
 
 
 
ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

1 Accounting policies continued 

The preparation of financial information in conformity with the basis of preparation described above requires the use of certain critical 

accounting estimates. It also requires management to exercise its judgement in the process of applying the company’s and group’s 

accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are 

significant to the consolidated financial information are disclosed in the critical accounting estimates and judgements section. 

Basis of consolidation 

The financial statements for FW Thorpe Plc incorporate the financial statements of the company and its subsidiary undertakings. 

A subsidiary is a company controlled directly by the group and all the subsidiaries are wholly owned by the group. The group achieves 

control over the subsidiaries by being able to influence financial and operating policies so as to obtain benefits from their activities. 

Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. 

Joint venture 

Joint ventures are all entities over which the group exercised joint control. Investments in joint ventures are accounted for by the equity 

method of accounting and are initially recognised at cost. 

The group discloses its share of the revenue and the operating profits on the face of the income statement. The group also discloses its 

share of the gross assets and liabilities on the face of the balance sheet. 

The carrying amount of an investment in a joint venture is tested for impairment by comparing its recoverable amount with its carrying 

amount whenever there is an indication that the investment may be impaired. 

Revenue recognition 

The group recognises revenue when the amount of revenue can be reliably measured; it is probable that future economic benefits will 

flow to the entity and when specific criteria have been met for each of the group’s activities. The amount of revenue is not considered to 

be reliably measurable until all contingencies relating to the sale have been resolved. The group bases its estimates on historical results, 

taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. Revenue is subsequently 

recognised based upon the goods and services provided, when these goods have been delivered to the customer or the service 

performed, excluding VAT and trade discounts. 

Interest income 

Interest income is recognised on a time proportion basis using the effective interest method. When a receivable is impaired the group 

reduces the carrying amount to its recoverable amount, being the estimated cash flow discounted at the original effective interest rate 

of the instrument and continues unwinding the discount as interest income. 

Interest on impaired loans is recognised using the original effective interest rate.  

Dividend income is recognised when the right to receive payment is established. 

Dividend income 

Segment reporting 

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. 

The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, 

it is identified as the group Board that makes strategic decisions. 

The group is organised into six operating segments based on the products and customer base in the lighting market. The largest business 

is Thorlux. The five remaining operating segments have been aggregated into the “other companies” reportable segment based upon 

their size, comprising the entities Compact Lighting, Philip Payne, Sugg Lighting, Solite Europe and Portland Lighting. 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

35

Intra-group transactions, balances, income and expenses are eliminated in preparing consolidated financial statements. 

•  For members joining post-1 October 1995, benefits provided are defined contribution in nature (the “pure defined contribution” 

1 Accounting policies continued 
Pension costs 
The group operates a hybrid defined benefit and defined contribution pension scheme. The basis of the groups’ hybrid pension scheme 
provides benefits to members based upon the following: 

•  Service before 1 October 1995, benefits provided are defined benefit in nature (the ”pure“ defined benefit element); 

•  Service after 1 October 1995 has two elements; 

•  For members joining pre-1 October 1995, benefits provided are the maximum of their defined contribution pension and their defined 

benefit pension (the ”defined benefit underpin“ element); 

element). 

The contributions of all three elements are paid into one pension scheme, where the contributions and assets are segregated and ring-
fenced from each other. The assets of the scheme are invested and managed independently of the finances of the group. Pension costs 
are assessed in accordance with the advice of an independent qualified actuary. Costs include the regular cost of providing benefits which 
it is intended should remain at a substantially level percentage of current and expected future earnings of the employees covered. 
Variations from the regular pensions cost are spread evenly through the income over the remaining service lives of current employees. 
Contributions made to the defined benefit scheme are charged to the income statement in the period in which they are made. 

The liability recognised in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit 
obligation at the balance sheet date less the fair value of plan assets, together with adjustments for unrecognised past-service costs. 
The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. In the defined 
benefit underpin element of the scheme the liabilities reflect the greater of the defined contribution or defined benefit liabilities. 

For the defined benefit underpin element of the scheme each member is tested to see whether the pension on a defined contribution 
or defined benefit basis is higher. The liabilities shown in the pensions note are based on the greater of the two liabilities for each member, 
which in almost all cases is the defined benefit liability. For the service cost, again tests are performed to see which is the higher for each 
member out of the company’s share of the defined contribution payments or the company’s share of accruing benefits on a defined 
benefit basis. The higher of these two figures for each member is then used to give the total service cost; again the defined benefit cost 
is the higher for the vast majority of members. 

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates 
of high quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity 
approximating to the terms of the related pension liability. 

Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to equity 
in the statement of comprehensive income in the period in which they arise. 

Past service costs are recognised immediately in income, unless the changes to the pension plan are conditional on the employees 
remaining in service for a specified period of time (the vesting period). In this case, the past-service costs are amortised on a straight-line 
basis over the vesting period.  

For defined contribution plans and pure defined contribution elements, the group pays contributions to publicly or privately 
administered pension insurance plans on a mandatory, contractual or voluntary basis. The group has no further payment obligations 
once the contributions have been paid. The contributions are recognised as employee benefit expense in the income statement as they 
fall due, or as an accrued or prepaid expense. Prepaid contributions are recognised as an asset to the extent that a cash refund or a 
reduction in the future payments is available. A defined benefit surplus is only recognised if it meets the following criteria; if the group 
has an unconditional right to a refund; or if the group can realise it at some point during the life of the plan or when the plan liabilities 
are settled. If the criteria are not met then a defined benefit surplus is not recognised. 

Foreign currencies 
Transactions in foreign currency are converted to sterling using the exchange rate applicable to the date of the transaction. Foreign 
currency gains and losses resulting from the settlement of foreign currency transactions at a different time are recognised in the income 
statement. Currency exchange differences arising from holding monetary assets or liabilities in a foreign currency are fair valued at the 
balance sheet date in accordance with prevailing exchange rates and resulting gains or losses are recognised in the income statement. 

The results of joint ventures and financial position of the joint ventures (which does not have the currency of a hyper-inflationary 
economy) that has a functional currency different from the presentational currency is translated into presentational currency as follows; 
assets and liabilities for the balance sheet presented are translated at the closing rate at the date of the balance sheet; and income and 
expenses for the income statement are translated at average exchange rates. All resulting exchange differences are recognised in other 
comprehensive income. 

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36

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ACCOUNTS 

1 Accounting policies continued 
Taxation 
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the 
countries where the company’s subsidiaries operate and generate taxable income. Management periodically evaluates positions taken 
in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where 
appropriate on the basis of amounts expected to be paid to the tax authorities.  

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and 
liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it 
arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction 
affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted 
or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the 
deferred income tax liability is settled. 

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the 
temporary differences can be utilised. 

Deferred income tax is provided on temporary differences arising on investments in subsidiaries and joint ventures, except where the 
timing of the reversal of the temporary difference is controlled by the group and it is probable that the temporary difference will not 
reverse in the foreseeable future. 

Dividend distribution 
Final dividend distribution to the company’s shareholders is recognised as a liability in the group’s financial statements in the period in 
which the dividends are approved by the company’s shareholders. 

Interim dividends are recognised as a liability in the group’s financial statements when approved by the directors. 

impairment in accordance with IAS 36. 

Property, plant and equipment 
Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses where applicable. Cost includes 
the original purchase price together with the costs attributable to bringing the asset to its working condition for its intended use. 

Depreciation is calculated on a straight-line basis to write down the cost less estimated residual value of all plant and equipment assets 
by equal instalments over their expected useful life. The rates generally applicable are: 

Freehold land 
Buildings 
Plant, vehicles and equipment  

Nil 
2–4% 
7–33% 

The assets’ residual values and useful lives are reviewed and adjusted, if appropriate, at each balance sheet date.  

Assets are reviewed for impairment where there is an indication that the carrying value may not be recoverable. 

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised within 
administrative expenses in the income statement. 

Leases 
Operating leases, and payments made under them are charged to the income statement on a straight-line basis over the term 
of the lease. 

1 Accounting policies continued 

Intangible assets 

Development costs 

The group undertakes development activities on an ongoing basis. Part of these costs relate to projects where the benefit is received 

in the short term (less than one year) and part relates to longer term projects where the benefit is expected to be received for several years 

to come. Costs associated with the shorter term activities are expensed as and when they are incurred. Costs associated with the longer 

term projects are capitalised as an intangible asset and amortised over the expected life of the benefit, generally at 33.33% per annum, 

commencing when the asset is available for use within the business. Development assets are recognised as intangible assets when the 

following criteria are met: 

•  It is technically feasible to complete the intangible asset so that it will be available for use; 

•  Management intends to complete the intangible asset and use or sell it; 

•  There is an ability to use or sell the intangible asset; 

•  It can be demonstrated how the intangible asset will generate probable future economic benefits; 

•  Adequate technical, financial and other resources to complete the development and to use or sell the intangible asset are available; and 

•  The expenditure attributable to the intangible asset during its development can be reliably measured. 

Other development expenditures that do not meet these criteria are recognised as an expense as incurred. 

Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. 

The economic success for development activities is uncertain and carrying amounts are reviewed at each balance sheet date for 

Development assets are valued at cost less accumulated amortisation and any impairment losses. 

Fishing rights are stated at cost less accumulated impairment where applicable. The rights are not amortised, but assessed annually 

Fishing rights 

for impairment.  

Goodwill 

its recoverable amount. 

Software costs 

20% and 50% per annum. 

Patent costs 

Other intangible assets 

Goodwill is stated at cost less accumulated impairment where applicable. Goodwill represents the excess of the cost of an acquisition 

over the fair value of the group’s share of the net assets of the acquired subsidiary undertaking at the date of acquisition. Goodwill is 

tested at least annually for impairment. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds 

Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating 

units or groups of cash-generating units that are expected to benefit from business combination in which the goodwill arose. 

Software costs are stated at cost less accumulated amortisation and impairment where applicable. Amortisation is calculated 

on a straight-line basis to write down the cost less estimated residual value over its useful life. The amortisation rates are between 

Patents are stated at cost less accumulated amortisation. Amortisation is calculated on a straight-line basis to write down the cost less 

estimated residual value over its useful life. The amortisation rate is 20%. 

An intangible asset acquired in a business combination is recognised at fair value to the extent it is probable that the expected future 

economic benefits attributable to the asset will flow to the group and that its cost can be measured reliably. Intangible assets principally 

relate to brand names and technology which was valued using an income approach. The cost of intangible assets is amortised through 

the income statement on a straight line basis over their estimated economic life. 

015702_FW_Thorpe_18-68.indd   36

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ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

1 Accounting policies continued 

Taxation 

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the 

countries where the company’s subsidiaries operate and generate taxable income. Management periodically evaluates positions taken 

in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where 

appropriate on the basis of amounts expected to be paid to the tax authorities.  

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and 

liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it 

arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction 

affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted 

or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the 

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the 

Deferred income tax is provided on temporary differences arising on investments in subsidiaries and joint ventures, except where the 

timing of the reversal of the temporary difference is controlled by the group and it is probable that the temporary difference will not 

deferred income tax liability is settled. 

temporary differences can be utilised. 

reverse in the foreseeable future. 

Dividend distribution 

which the dividends are approved by the company’s shareholders. 

Interim dividends are recognised as a liability in the group’s financial statements when approved by the directors. 

Property, plant and equipment 

Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses where applicable. Cost includes 

the original purchase price together with the costs attributable to bringing the asset to its working condition for its intended use. 

Depreciation is calculated on a straight-line basis to write down the cost less estimated residual value of all plant and equipment assets 

by equal instalments over their expected useful life. The rates generally applicable are: 

Freehold land 

Buildings 

Plant, vehicles and equipment  

Nil 

2–4% 

7–33% 

The assets’ residual values and useful lives are reviewed and adjusted, if appropriate, at each balance sheet date.  

Assets are reviewed for impairment where there is an indication that the carrying value may not be recoverable. 

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised within 

administrative expenses in the income statement. 

Operating leases, and payments made under them are charged to the income statement on a straight-line basis over the term 

Leases 

of the lease. 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

37

1 Accounting policies continued 
Intangible assets 
Development costs 
The group undertakes development activities on an ongoing basis. Part of these costs relate to projects where the benefit is received 
in the short term (less than one year) and part relates to longer term projects where the benefit is expected to be received for several years 
to come. Costs associated with the shorter term activities are expensed as and when they are incurred. Costs associated with the longer 
term projects are capitalised as an intangible asset and amortised over the expected life of the benefit, generally at 33.33% per annum, 
commencing when the asset is available for use within the business. Development assets are recognised as intangible assets when the 
following criteria are met: 

•  It is technically feasible to complete the intangible asset so that it will be available for use; 

•  Management intends to complete the intangible asset and use or sell it; 

•  There is an ability to use or sell the intangible asset; 

•  It can be demonstrated how the intangible asset will generate probable future economic benefits; 

•  Adequate technical, financial and other resources to complete the development and to use or sell the intangible asset are available; and 

•  The expenditure attributable to the intangible asset during its development can be reliably measured. 

Other development expenditures that do not meet these criteria are recognised as an expense as incurred. 

Final dividend distribution to the company’s shareholders is recognised as a liability in the group’s financial statements in the period in 

Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. 

The economic success for development activities is uncertain and carrying amounts are reviewed at each balance sheet date for 
impairment in accordance with IAS 36. 

Development assets are valued at cost less accumulated amortisation and any impairment losses. 

Fishing rights 
Fishing rights are stated at cost less accumulated impairment where applicable. The rights are not amortised, but assessed annually 
for impairment.  

Goodwill 
Goodwill is stated at cost less accumulated impairment where applicable. Goodwill represents the excess of the cost of an acquisition 
over the fair value of the group’s share of the net assets of the acquired subsidiary undertaking at the date of acquisition. Goodwill is 
tested at least annually for impairment. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds 
its recoverable amount. 

Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating 
units or groups of cash-generating units that are expected to benefit from business combination in which the goodwill arose. 

Software costs 
Software costs are stated at cost less accumulated amortisation and impairment where applicable. Amortisation is calculated 
on a straight-line basis to write down the cost less estimated residual value over its useful life. The amortisation rates are between 
20% and 50% per annum. 

Patent costs 
Patents are stated at cost less accumulated amortisation. Amortisation is calculated on a straight-line basis to write down the cost less 
estimated residual value over its useful life. The amortisation rate is 20%. 

Other intangible assets 
An intangible asset acquired in a business combination is recognised at fair value to the extent it is probable that the expected future 
economic benefits attributable to the asset will flow to the group and that its cost can be measured reliably. Intangible assets principally 
relate to brand names and technology which was valued using an income approach. The cost of intangible assets is amortised through 
the income statement on a straight line basis over their estimated economic life. 

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38

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ACCOUNTS 

1 Accounting policies continued 
Investment properties 
Investment properties are recognised at cost, and then subsequently cost less accumulated depreciation and (if applicable) any 
accumulated impairment losses. Freehold land is not depreciated. 

Investments in subsidiaries and Joint Ventures 
Investments in subsidiaries are held at cost less impairment. Cost includes directly attributable costs of investment. The group has applied 
the equity method of accounting to recognise the interest in the joint venture. 

Inventories 
Inventories are stated at the lower of cost and net realisable value. Cost is determined by the first-in, first-out (FIFO) method.  

The cost of finished goods and work in progress comprises raw materials, direct labour, other direct costs and related production 
overheads based on normal operating capacity. Net realisable value is the estimated selling price in the ordinary course of business, 
less the costs of completion and selling expenses. Provision is made against the cost of slow-moving, obsolete and other stock lines based 
on their net realisable value. 

Trade receivables 
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, 
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 the receivables. Significant financial difficulties of the 
debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 
30 days overdue) are considered indicators that the trade receivable is impaired. The amount of the provision is the difference between 
the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. 
The carrying amount of the asset is reduced through the use of an allowance account, the amount of the loss is recognised in the income 
statement within “selling and distribution costs”. When a trade receivable is uncollectible, it is written off against the allowance account 
for trade receivables. Subsequent recoveries of amounts previously written off are credited against “selling and distribution costs” in the 
income statement. 

Financial assets at fair value through profit and loss 
Financial assets at fair value through profit and loss are financial assets held for trading and are measured at their fair values. 

Non-current assets and disposal groups held for sale 
Non-current assets and disposal groups are classified as assets held for sale when their carrying amount is to be recovered principally 
through a sale transaction and a sale is considered highly probable. They are stated at the lower of their carrying amount and fair value 
less costs to sell if their carrying amount is to be recovered principally through a sale transaction rather than through continuing use 
and a sale is considered highly probable. 

Short-term financial assets 
Short-term financial assets are defined as cash term deposits with banks with an original term of three months and over. 

Cash and cash equivalents 
Cash and cash equivalents are defined as cash in hand, on demand deposits and short-term deposits with banks with an original term 
less than three months. 

Current asset investments 
Current asset investments are valued at fair value. Changes in fair value are recognised in the income statement. 

Available-for-sale financial assets 
The fair value of quoted investments is based on current bid prices. Changes to fair value are recognised in the statement 
of comprehensive income. 

Trade payables 
Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. 

Provisions 
Provisions are recognised in the balance sheet when a group company has a present obligation (legal or constructive) as a result of a past 
event; it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable 
estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the expenditure 
required to settle the present obligation at the balance sheet date. 

If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current 
market assessments of the time value of money and, where appropriate, the risks specific to the liability. A provision for restructuring 
is recognised when the group has approved a detailed and formal restructuring plan, and the restructuring has either commenced 
or has been announced to those affected by it. In accordance with the group’s published environmental policy and applicable legal 
requirements, a provision for site restoration in respect of contaminated land is recognised when land is contaminated. 

A provision for onerous contracts is recognised when the expected benefits to be derived by the group from a contract are lower than 
the unavoidable cost of meeting its obligations under the contract.  

1 Accounting policies continued 

Critical accounting estimates and judgements 

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

of future events that are believed to be reasonable under the circumstances. 

The group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal 

the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying 

amounts of assets and liabilities within the next financial year are discussed below. 

Retirement benefit obligations 

The group recognises its obligations to employee retirement benefits. The quantification of these obligations is subject to significant 

estimates and assumptions regarding life expectancy, discount and inflation rates and the rate of increase in pension payments. In making 

these assumptions the group takes advice from an independent qualified actuary about which assumptions best reflect the nature of the 

group’s obligations to employee retirement benefits. These assumptions are regularly reviewed by our actuaries Bluefin Corporate 

Consulting Ltd to ensure their appropriateness. 

Warranty provisions 

The group makes provisions for the warranty provided with the terms and conditions of sale to the customer based on past experience 

together with specific provisions for known issues. There are quality control procedures in place to ensure that products reaching 

customers are of a high standard. The technical support areas record all warranty issues in order that problems can be identified that 

may affect a wider customer base. Additionally, product failures are tested thoroughly to examine technical failures and strategies are 

developed to minimise and correct issues arising from that examination. The group works closely with its suppliers to ensure a low 

IFRS 3 requires the identification of acquired intangible assets as part of a business combination. The methods used to value such 

intangible assets require the use of estimates. Future results are impacted by the amortisation periods adopted and changes to the 

estimated useful lives would result in different effects on the income statement and balance sheet. 

Goodwill is not amortised but is tested annually for impairment. Tests for impairment are based on discounted cash flows and 

assumptions (including discount rates, timing and growth prospects) which are inherently subjective. 

The group’s activities expose it to a variety of financial risks: market risk (including currency risk, commodity price risk and security price 

risk), credit risk and liquidity risk. The group’s overall risk management programme focuses on the unpredictability of financial markets 

and seeks to minimise potential adverse effects on the group’s financial performance. The group may use derivative financial instruments 

failure rate for components. 

Intangible assets 

Financial risk factors  

to hedge certain risk exposures. 

(a) Market risk 

(i) Foreign exchange risk 

The group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect 

to the euro, US dollar and the UK pound. Foreign exchange risk arises from future commercial transactions denominated in a currency 

that is not the entity’s functional currency as well as bank account balances denominated in currencies other than sterling. The group has 

carried out an exercise to evaluate the effect of a movement of 1% in each currency other than sterling, and the results are not significant. 

(ii) Price risk  

The group is exposed to equity securities price risk because of investments held by the group and classified on the consolidated balance 

sheet either as available-for-sale or at fair value through profit or loss.  

The group has investments in UK listed securities of other entities and these are publicly traded on the London Stock Exchange. 

The group has an exposure to the risk of commodity price changes, in particular, metals. The group seeks to minimise the risk by agreeing 

(iii) Commodity price risk 

prices with major suppliers in advance. 

(iv) Interest rate risk 

The group is exposed to interest rate risk because it has cash investments and short-term financial assets which are mostly interest 

bearing. The effect of a reduction in interest rates is to reduce financial income. There are no borrowings and the group has no exposure 

to the risk of increased interest cost other than pension scheme interest cost. 

(b) Credit risk 

Credit risk is managed on a group basis. Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits 

with banks and financial institutions, as well as credit exposures to wholesale and retail customers, including outstanding receivables 

and committed transactions. For banks and financial institutions, only independently rated parties with a minimum Fitch rating 

of F1 are accepted. If wholesale customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, 

risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. 

Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board. The utilisation of credit 

limits is regularly monitored.  

015702_FW_Thorpe_18-68.indd   38

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ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

Investment properties are recognised at cost, and then subsequently cost less accumulated depreciation and (if applicable) any 

1 Accounting policies continued 

Investment properties 

accumulated impairment losses. Freehold land is not depreciated. 

Investments in subsidiaries and Joint Ventures 

Investments in subsidiaries are held at cost less impairment. Cost includes directly attributable costs of investment. The group has applied 

the equity method of accounting to recognise the interest in the joint venture. 

Inventories 

Inventories are stated at the lower of cost and net realisable value. Cost is determined by the first-in, first-out (FIFO) method.  

The cost of finished goods and work in progress comprises raw materials, direct labour, other direct costs and related production 

overheads based on normal operating capacity. Net realisable value is the estimated selling price in the ordinary course of business, 

less the costs of completion and selling expenses. Provision is made against the cost of slow-moving, obsolete and other stock lines based 

on their net realisable value. 

Trade receivables 

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, 

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 the receivables. Significant financial difficulties of the 

debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 

30 days overdue) are considered indicators that the trade receivable is impaired. The amount of the provision is the difference between 

the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. 

The carrying amount of the asset is reduced through the use of an allowance account, the amount of the loss is recognised in the income 

statement within “selling and distribution costs”. When a trade receivable is uncollectible, it is written off against the allowance account 

for trade receivables. Subsequent recoveries of amounts previously written off are credited against “selling and distribution costs” in the 

income statement. 

Financial assets at fair value through profit and loss 

Financial assets at fair value through profit and loss are financial assets held for trading and are measured at their fair values. 

Non-current assets and disposal groups held for sale 

Non-current assets and disposal groups are classified as assets held for sale when their carrying amount is to be recovered principally 

through a sale transaction and a sale is considered highly probable. They are stated at the lower of their carrying amount and fair value 

less costs to sell if their carrying amount is to be recovered principally through a sale transaction rather than through continuing use 

Short-term financial assets are defined as cash term deposits with banks with an original term of three months and over. 

Cash and cash equivalents are defined as cash in hand, on demand deposits and short-term deposits with banks with an original term 

Current asset investments are valued at fair value. Changes in fair value are recognised in the income statement. 

The fair value of quoted investments is based on current bid prices. Changes to fair value are recognised in the statement 

Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. 

Provisions are recognised in the balance sheet when a group company has a present obligation (legal or constructive) as a result of a past 

event; it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable 

estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the expenditure 

required to settle the present obligation at the balance sheet date. 

If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current 

market assessments of the time value of money and, where appropriate, the risks specific to the liability. A provision for restructuring 

is recognised when the group has approved a detailed and formal restructuring plan, and the restructuring has either commenced 

or has been announced to those affected by it. In accordance with the group’s published environmental policy and applicable legal 

requirements, a provision for site restoration in respect of contaminated land is recognised when land is contaminated. 

A provision for onerous contracts is recognised when the expected benefits to be derived by the group from a contract are lower than 

the unavoidable cost of meeting its obligations under the contract.  

and a sale is considered highly probable. 

Short-term financial assets 

Cash and cash equivalents 

less than three months. 

Current asset investments 

Available-for-sale financial assets 

of comprehensive income. 

Trade payables 

Provisions 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

39

1 Accounting policies continued 
Critical accounting estimates and judgements 
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations 
of future events that are believed to be reasonable under the circumstances. 

The group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal 
the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying 
amounts of assets and liabilities within the next financial year are discussed below. 

Retirement benefit obligations 
The group recognises its obligations to employee retirement benefits. The quantification of these obligations is subject to significant 
estimates and assumptions regarding life expectancy, discount and inflation rates and the rate of increase in pension payments. In making 
these assumptions the group takes advice from an independent qualified actuary about which assumptions best reflect the nature of the 
group’s obligations to employee retirement benefits. These assumptions are regularly reviewed by our actuaries Bluefin Corporate 
Consulting Ltd to ensure their appropriateness. 

Warranty provisions 
The group makes provisions for the warranty provided with the terms and conditions of sale to the customer based on past experience 
together with specific provisions for known issues. There are quality control procedures in place to ensure that products reaching 
customers are of a high standard. The technical support areas record all warranty issues in order that problems can be identified that 
may affect a wider customer base. Additionally, product failures are tested thoroughly to examine technical failures and strategies are 
developed to minimise and correct issues arising from that examination. The group works closely with its suppliers to ensure a low 
failure rate for components. 

Intangible assets 
IFRS 3 requires the identification of acquired intangible assets as part of a business combination. The methods used to value such 
intangible assets require the use of estimates. Future results are impacted by the amortisation periods adopted and changes to the 
estimated useful lives would result in different effects on the income statement and balance sheet. 

Goodwill is not amortised but is tested annually for impairment. Tests for impairment are based on discounted cash flows and 
assumptions (including discount rates, timing and growth prospects) which are inherently subjective. 

Financial risk factors  
The group’s activities expose it to a variety of financial risks: market risk (including currency risk, commodity price risk and security price 
risk), credit risk and liquidity risk. The group’s overall risk management programme focuses on the unpredictability of financial markets 
and seeks to minimise potential adverse effects on the group’s financial performance. The group may use derivative financial instruments 
to hedge certain risk exposures. 

(a) Market risk 
(i) Foreign exchange risk 
The group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect 
to the euro, US dollar and the UK pound. Foreign exchange risk arises from future commercial transactions denominated in a currency 
that is not the entity’s functional currency as well as bank account balances denominated in currencies other than sterling. The group has 
carried out an exercise to evaluate the effect of a movement of 1% in each currency other than sterling, and the results are not significant. 

(ii) Price risk  
The group is exposed to equity securities price risk because of investments held by the group and classified on the consolidated balance 
sheet either as available-for-sale or at fair value through profit or loss.  

The group has investments in UK listed securities of other entities and these are publicly traded on the London Stock Exchange. 

(iii) Commodity price risk 
The group has an exposure to the risk of commodity price changes, in particular, metals. The group seeks to minimise the risk by agreeing 
prices with major suppliers in advance. 

(iv) Interest rate risk 
The group is exposed to interest rate risk because it has cash investments and short-term financial assets which are mostly interest 
bearing. The effect of a reduction in interest rates is to reduce financial income. There are no borrowings and the group has no exposure 
to the risk of increased interest cost other than pension scheme interest cost. 

(b) Credit risk 
Credit risk is managed on a group basis. Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits 
with banks and financial institutions, as well as credit exposures to wholesale and retail customers, including outstanding receivables 
and committed transactions. For banks and financial institutions, only independently rated parties with a minimum Fitch rating 
of F1 are accepted. If wholesale customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, 
risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. 
Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board. The utilisation of credit 
limits is regularly monitored.  

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40

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

1 Accounting policies continued 
(c) Liquidity risk 
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the ability to close out 
market positions.  

Management monitors rolling forecasts of the group’s liquidity reserve which comprises cash and cash equivalents together with  
short-term financial assets (note 15) on the basis of expected cash flow.  

All external current liabilities are expected to mature within four months. 

Capital risk management 
The group’s policy has been to maintain a strong capital basis in order to maintain investor, customer, creditor and market confidence. 
This sustains future development of the business, safeguarding the group’s ability to continue as a going concern in order to provide 
returns for shareholders and benefits for other stakeholders.  

In order to maintain or adjust the capital structure, the group may adjust the amount of dividends paid to shareholders, return capital 
to shareholders or issue new shares. From time to time the group purchases its own shares in the market; the timing of these purchases 
is dependent on market prices, to ensure such transactions are sufficiently beneficial for the company, its earnings per share and returns 
to investors. The group continues to seek to maintain the balance of these returns, while strengthening the reserves and equity position 
of the company, via continued profitability, and structured growth. 

The group has a long-standing policy not to utilise debt within the business, providing a robust capital structure even within the toughest 
economic conditions. The group’s significant cash resources allow such a position, but also require close management, to ensure that 
sufficient returns are being generated from these resources. The group’s policy with regards the cash resources are to ensure they 
generate sufficient returns, whether by investment in business activities, such as plant and equipment, or assessing suitable opportunities 
to grow the business, or the physical investment of these funds to ensure appropriate returns to investors. The maintenance of the 
group’s cash position is also assessed against other assets of the business to allow investors the benefits of obtaining business property 
relief from investing within the group, which will continue to be a focus of the group due to our balance sheet position. 

The group is able to maintain its current capital structure because there are no externally imposed capital requirements, and there were 
no changes in the group’s approach to capital management during the year. 

The group’s objectives when managing capital are to safeguard the group’s ability to continue as a going concern in order to provide 
returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.  

In order to maintain or adjust the capital structure, the group may adjust the amount of dividends paid to shareholders, return capital 
to shareholders, issue new shares or sell assets to reduce debt.  

Fair value estimation 
Financial instruments 
Financial instruments that are measured at fair value are disclosed in the consolidated financial statements in accordance with the 
following fair value measurement hierarchy: 

i)  Quoted prices (unadjusted) in active markets for identical assets and liabilities (level 1) 

ii) Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices, 

or indirectly (that is, derived from prices) (level 2) 

iii) Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3) 

The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques.  

These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity 
specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2. 

Other assets and liabilities 
The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values. The fair value 
of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest 
rate that is available to the group for similar financial instruments. 

Share capital 
Ordinary shares are classified as equity. 

Where any group company purchases the company’s equity share capital (treasury shares), the consideration paid, including any directly 
attributable incremental costs (net of income taxes) is deducted from the equity attributable to the company’s equity holders until the 
shares are cancelled or reissued. Where such shares are subsequently reissued, any consideration received, net of any directly attributable 
incremental transaction costs and the related income tax effects, is included in equity attributable to the company’s equity holders. 

015702_FW_Thorpe_18-68.indd   40

10/10/2012   15:49

ACCOUNTS 

2 Segmental analysis 

(a) Business segments 

Year to 30 June 2012 

Revenue to external customers 

Revenue to other group companies 

Total revenue 

Operating profit 

Net finance income 

Share of loss of joint venture 

Profit before income tax 

Year to 30 June 2011 

Revenue to external customers 

Revenue to other group companies 

Total revenue 

Operating profit 

Net finance income 

Share of loss of joint venture 

Profit before income tax 

group companies. 

(b) Geographical analysis  

UK 

Europe 

Other countries 

The segmental analysis is presented on the same basis as that used for internal reporting purposes. For internal reporting FW Thorpe 

is organised into six operating segments based on the products and customer base in the lighting market – the largest business 

is Thorlux, which manufactures professional lighting systems for industrial, commercial and controls markets. The five remaining 

operating segments have been aggregated into the “other companies” reportable segment based upon their size, comprising the 

entities Compact Lighting Limited, Philip Payne Limited, Sugg Lighting Limited, Solite Europe Limited and Portland Lighting Limited. 

FW Thorpe’s chief operating decision-maker (CODM) is the group Board. The group Board reviews the group’s internal reporting in order 

to monitor and assess performance of the operating segments for the purpose of making decisions about resources to be allocated. 

Performance is evaluated based on a combination of revenue and operating profit. Assets and liabilities have not been segmented, 

which is consistent with the group’s internal reporting. 

Thorlux 

companies 

adjustments 

Other 

£’000 

Inter-

segment 

£’000

Total 

continuing 

operations 

£’000

£’000

44,869

10,690 

–

55,559

80

44,949

10,740

507 

11,197 

828 

(587)

(587)

282

43,909

145

44,054

10,407

8,924 

619 

9,543 

649 

–

(764)

(764)

196

–

55,559

11,850

831

(23)

12,658

52,833

–

52,833

11,252

372

(11)

11,613

2012 

£’000 

47,806 

4,704 

3,049 

55,559 

2011

£’000

47,577

3,101

2,155

52,833

Inter segment adjustments to operating profit consist of property rentals on premises owned by FW Thorpe Plc, adjustments to profit 

related to stocks held within the group that were supplied by another segment and adjustments to investment provisions relating to 

The group’s business segments operate in three main areas, the UK, the rest of Europe and the rest of the World. 

The home country of the company, which is also the main operating company, is the UK. 

The group’s revenue is generated mainly within the UK. 

All assets and consequently capital expenditure are in the UK, and cannot be split geographically in relation to the group’s revenues. 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

1 Accounting policies continued 

(c) Liquidity risk 

market positions.  

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the ability to close out 

Management monitors rolling forecasts of the group’s liquidity reserve which comprises cash and cash equivalents together with  

short-term financial assets (note 15) on the basis of expected cash flow.  

All external current liabilities are expected to mature within four months. 

Capital risk management 

The group’s policy has been to maintain a strong capital basis in order to maintain investor, customer, creditor and market confidence. 

This sustains future development of the business, safeguarding the group’s ability to continue as a going concern in order to provide 

returns for shareholders and benefits for other stakeholders.  

In order to maintain or adjust the capital structure, the group may adjust the amount of dividends paid to shareholders, return capital 

to shareholders or issue new shares. From time to time the group purchases its own shares in the market; the timing of these purchases 

is dependent on market prices, to ensure such transactions are sufficiently beneficial for the company, its earnings per share and returns 

to investors. The group continues to seek to maintain the balance of these returns, while strengthening the reserves and equity position 

of the company, via continued profitability, and structured growth. 

The group has a long-standing policy not to utilise debt within the business, providing a robust capital structure even within the toughest 

economic conditions. The group’s significant cash resources allow such a position, but also require close management, to ensure that 

sufficient returns are being generated from these resources. The group’s policy with regards the cash resources are to ensure they 

generate sufficient returns, whether by investment in business activities, such as plant and equipment, or assessing suitable opportunities 

to grow the business, or the physical investment of these funds to ensure appropriate returns to investors. The maintenance of the 

group’s cash position is also assessed against other assets of the business to allow investors the benefits of obtaining business property 

relief from investing within the group, which will continue to be a focus of the group due to our balance sheet position. 

The group is able to maintain its current capital structure because there are no externally imposed capital requirements, and there were 

no changes in the group’s approach to capital management during the year. 

The group’s objectives when managing capital are to safeguard the group’s ability to continue as a going concern in order to provide 

returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.  

In order to maintain or adjust the capital structure, the group may adjust the amount of dividends paid to shareholders, return capital 

to shareholders, issue new shares or sell assets to reduce debt.  

Fair value estimation 

Financial instruments 

Financial instruments that are measured at fair value are disclosed in the consolidated financial statements in accordance with the 

following fair value measurement hierarchy: 

i)  Quoted prices (unadjusted) in active markets for identical assets and liabilities (level 1) 

ii) Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices, 

or indirectly (that is, derived from prices) (level 2) 

iii) Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3) 

The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques.  

These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity 

specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2. 

Other assets and liabilities 

The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values. The fair value 

of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest 

rate that is available to the group for similar financial instruments. 

Share capital 

Ordinary shares are classified as equity. 

Where any group company purchases the company’s equity share capital (treasury shares), the consideration paid, including any directly 

attributable incremental costs (net of income taxes) is deducted from the equity attributable to the company’s equity holders until the 

shares are cancelled or reissued. Where such shares are subsequently reissued, any consideration received, net of any directly attributable 

incremental transaction costs and the related income tax effects, is included in equity attributable to the company’s equity holders. 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

41

2 Segmental analysis 
(a) Business segments 
The segmental analysis is presented on the same basis as that used for internal reporting purposes. For internal reporting FW Thorpe 
is organised into six operating segments based on the products and customer base in the lighting market – the largest business 
is Thorlux, which manufactures professional lighting systems for industrial, commercial and controls markets. The five remaining 
operating segments have been aggregated into the “other companies” reportable segment based upon their size, comprising the 
entities Compact Lighting Limited, Philip Payne Limited, Sugg Lighting Limited, Solite Europe Limited and Portland Lighting Limited. 

FW Thorpe’s chief operating decision-maker (CODM) is the group Board. The group Board reviews the group’s internal reporting in order 
to monitor and assess performance of the operating segments for the purpose of making decisions about resources to be allocated. 
Performance is evaluated based on a combination of revenue and operating profit. Assets and liabilities have not been segmented, 
which is consistent with the group’s internal reporting. 

Year to 30 June 2012 
Revenue to external customers 
Revenue to other group companies 
Total revenue 
Operating profit 
Net finance income 
Share of loss of joint venture 
Profit before income tax 

Year to 30 June 2011 
Revenue to external customers 
Revenue to other group companies 
Total revenue 
Operating profit 
Net finance income 
Share of loss of joint venture 
Profit before income tax 

Thorlux 
£’000

Other 
companies 
£’000 

Inter-
segment 
adjustments 
£’000

Total 
continuing 
operations 
£’000

44,869
80
44,949
10,740

10,690 
507 
11,197 
828 

–
(587)
(587)
282

43,909
145
44,054
10,407

8,924 
619 
9,543 
649 

–
(764)
(764)
196

55,559
–
55,559
11,850
831
(23)
12,658

52,833
–
52,833
11,252
372
(11)
11,613

Inter segment adjustments to operating profit consist of property rentals on premises owned by FW Thorpe Plc, adjustments to profit 
related to stocks held within the group that were supplied by another segment and adjustments to investment provisions relating to 
group companies. 

(b) Geographical analysis  
The group’s business segments operate in three main areas, the UK, the rest of Europe and the rest of the World. 

The home country of the company, which is also the main operating company, is the UK. 

The group’s revenue is generated mainly within the UK. 

UK 
Europe 
Other countries 

2012 
£’000 

47,806 
4,704 
3,049 
55,559 

2011
£’000

47,577
3,101
2,155
52,833

All assets and consequently capital expenditure are in the UK, and cannot be split geographically in relation to the group’s revenues. 

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42

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

3 Group operating profit 

Group operating profit is stated after charging/(crediting): 
Profit on sale of fixed assets 
Rental income from investment property 
Depreciation of tangible fixed assets (note 10): 
– owned assets 
Operating lease rentals: 
– plant and machinery 
– other 
Intangible amortisation (note 9) 
Foreign exchange losses/(gains) recognised in income statement 

Services provided by the company’s auditors 
During the year, the group obtained the following services from the company’s audit and its auditors: 

Group 

Fees payable to company’s auditors for the audit of parent company and consolidated financial statements 
Fee payable to the company’s auditor and its associates for other services: 
– the audit of company’s subsidiaries pursuant to legislation 
– tax services 
– Transactional services 

2012
£’000

(71)
(69)

1,062

31
118
993
141

2011
£’000

(48)
(5)

914

43
46
733
(108)

2012
£’000

2011
£’000

41

34
6
–
81

38

26
–
15
79

It is the group’s practice to employ PricewaterhouseCoopers LLP on assignments additional to their statutory audit duties where their 
expertise and experience with the group are important. 

4 Other gains – net 
Other financial assets at fair value through profit or loss (note 19). 

Fair value gains 

Other financial assets at fair value consist of units in a sterling cash fund. 

2012
£’000

–
–

2011
£’000

1
1

Aggregate emoluments 

Contributions to money purchase pension schemes 

Highest paid director 

Total of emoluments and amounts receivable 

The highest paid director is a pensioner of the retirement benefits scheme (2012 and 2011: accrued pension of £131,000). 

At the 30 June retirement benefits were accruing to M Allcock and D Taylor (2011: M Allcock and D Taylor) under the defined benefit 

scheme and to A M Cooper (2011: D Dimeloe, N A Brangwin and A M Cooper) under the defined contribution scheme. 

Further details are provided in the directors’ remuneration report on pages 22 to 24. 

The average monthly number of employees employed by the group (including executive directors) during the year is analysed below: 

ACCOUNTS 

5 Employee information 

Production 

Sales and distribution 

Administration 

Total average headcount 

Employment costs of all employees (including executive directors). 

Aggregate gross wages and salaries 

Employers’ national insurance contributions 

Employers’ pension and related charges 

Employers’ pension related charges include life assurance of £51,000 (2011: £58,000), pension administration and professional charges of 

£91,000 (2011: £62,000), a pension paid to a former director, contributions to Sugg Lighting Ltd group personal pension plan and a private 

pension scheme amounting to £75,000 (2011: £68,000). 

Contributions to the defined contribution section amounted to £333,000 (2011: £311,000). 

Directors’ emoluments 

2012

Number

2011

Number

230

95

142

467

2012

£’000

13,423

1,487

717

15,627

2012

£’000

1,274

20

1,294

2012

£’000

292

216

91

136

443

2011

£’000

12,854

1,425

610

14,889

2011

£’000

1,520

30

1,550

2011

£’000

285

015702_FW_Thorpe_18-68.indd   42

10/10/2012   15:49

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

3 Group operating profit 

Group operating profit is stated after charging/(crediting): 

Profit on sale of fixed assets 

Rental income from investment property 

Depreciation of tangible fixed assets (note 10): 

– owned assets 

Operating lease rentals: 

– plant and machinery 

– other 

Intangible amortisation (note 9) 

Foreign exchange losses/(gains) recognised in income statement 

Services provided by the company’s auditors 

During the year, the group obtained the following services from the company’s audit and its auditors: 

Fees payable to company’s auditors for the audit of parent company and consolidated financial statements 

Fee payable to the company’s auditor and its associates for other services: 

– the audit of company’s subsidiaries pursuant to legislation 

Group 

– tax services 

– Transactional services 

It is the group’s practice to employ PricewaterhouseCoopers LLP on assignments additional to their statutory audit duties where their 

expertise and experience with the group are important. 

4 Other gains – net 

Other financial assets at fair value through profit or loss (note 19). 

Fair value gains 

Other financial assets at fair value consist of units in a sterling cash fund. 

2012

£’000

(71)

(69)

1,062

31

118

993

141

41

34

6

–

81

2011

£’000

(48)

(5)

914

43

46

733

(108)

38

26

–

15

79

2012

£’000

2011

£’000

2012

£’000

–

–

2011

£’000

1

1

FW Thorpe Plc
Annual	Report	and	Accounts	2012

43

5 Employee information 
The average monthly number of employees employed by the group (including executive directors) during the year is analysed below: 

Production 
Sales and distribution 
Administration 
Total average headcount 

Employment costs of all employees (including executive directors). 

Aggregate gross wages and salaries 
Employers’ national insurance contributions 
Employers’ pension and related charges 

2012
Number

2011
Number

230
95
142
467

2012
£’000

13,423
1,487
717
15,627

216
91
136
443

2011
£’000

12,854
1,425
610
14,889

Employers’ pension related charges include life assurance of £51,000 (2011: £58,000), pension administration and professional charges of 
£91,000 (2011: £62,000), a pension paid to a former director, contributions to Sugg Lighting Ltd group personal pension plan and a private 
pension scheme amounting to £75,000 (2011: £68,000). 

Contributions to the defined contribution section amounted to £333,000 (2011: £311,000). 

Directors’ emoluments 

Aggregate emoluments 
Contributions to money purchase pension schemes 

Highest paid director 

Total of emoluments and amounts receivable 

2012
£’000

1,274
20
1,294

2012
£’000

292

2011
£’000

1,520
30
1,550

2011
£’000

285

The highest paid director is a pensioner of the retirement benefits scheme (2012 and 2011: accrued pension of £131,000). 

At the 30 June retirement benefits were accruing to M Allcock and D Taylor (2011: M Allcock and D Taylor) under the defined benefit 
scheme and to A M Cooper (2011: D Dimeloe, N A Brangwin and A M Cooper) under the defined contribution scheme. 

Further details are provided in the directors’ remuneration report on pages 22 to 24. 

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015702_FW_Thorpe_18-68.indd   43

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44

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

6 Net financial income 

Finance income 
Current assets 
Interest receivable 
Non-current assets 
Dividend income on available-for-sale financial assets 
Net rental income 
Net interest on pension scheme assets and liabilities 

7 Income tax expense 
Analysis of income tax expense in the year. 

Current tax 
Current tax on profits for the year 
Adjustments in respect of prior years 
Total current tax 

Deferred tax (note 22) 
Origination and reversal of temporary differences 
Total deferred tax 
Income tax expense 

2012
£’000

2011
£’000

387

79
197
168
831

258

16
65
33
372

2012
£’000

2011
£’000

2,699
(57)
2,642

76
76
2,718

2,669
6
2,675

526
526
3,201

The tax assessed for the year is lower (2011: higher) than the standard rate of corporation tax in the UK of 25.5% (2011: 27.5%). 
The differences are explained below: 

Accumulated amortisation 

Profit before tax 

Profit on ordinary activities multiplied by the standard rate in the UK of 25.5% (2011: 27.5%) 
Effects of: 
Expenses not deductible for tax purposes 
Accelerated tax allowances and other timing differences 
Adjustments in respect of prior years 
Profits taxed at small companies rate 
Other 
Tax charge 

The weighted average applicable tax rate was 21.5% (2011: 27.6%). 

2012
£’000

2011
£’000

12,658

11,613

3,228

3,194

18
(356)
(57)
(3)
(112)
2,718

44
(116)
6
(2)
75
3,201

8 Dividends 
The dividends paid in 2012 and 2011 were £2,122,000 (18.1p per share) and £1,981,000 (16.9p per share) respectively.  

A final dividend in respect of the year ended 30 June 2012 of 14.6p per share, amounting to a total dividend of £1,712,000, is to be 
proposed at the Annual General Meeting on 15 November 2012. These financial statements do not reflect this dividend payable. 

Acquisition of subsidiary (note 28) 

Accumulated amortisation 

ACCOUNTS 

9 Intangible assets 

Group 2012 

Cost 

At 1 July 2011 

Additions 

Write-offs 

At 30 June 2012 

At 1 July 2011  

Charge for the year 

Write-offs 

At 30 June 2012 

Net book amount 

At 30 June 2012 

Group 2011 

Cost 

At 1 July 2010 

Additions 

Write-offs 

At 30 June 2011 

At 1 July 2010  

Charge for the year 

Write-offs 

At 30 June 2011 

Net book amount 

At 30 June 2011 

2,903 

2,278

249

116

120 

182

5,984

Write-offs relate to development assets where no further economic benefits will be obtained. 

Development 

Goodwill  

£’000 

costs 

£’000

Technology 

Brand name 

£’000

£’000

Software 

£’000

Patents  

£’000 

Fishing 

rights 

£’000

Fishing 

rights 

£’000

35

147

150 

182

Development 

Goodwill  

£’000 

costs 

£’000

Technology 

Brand name 

£’000

£’000

Software 

£’000

Patents  

£’000 

885 

2,618 

– 

– 

3,503 

600 

– 

– 

600 

885 

– 

– 

885 

600 

– 

– 

600 

2,961

1,052

–

(575)

3,438

982

753

(575)

1,160

3,561

930

(861)

3,630

1,320

884

(861)

1,343

–

–

–

311

311

–

62

–

62

–

–

–

–

–

–

–

–

–

–

–

–

–

–

174

174

–

58

–

58

–

–

–

–

–

–

–

–

–

–

–

587

142

–

–

729

503

90

–

593

136

584

36

–

620

462

63

–

525

95

(12)

83

150 

– 

– 

– 

– 

30 

– 

30 

150 

– 

– 

150 

– 

– 

– 

– 

150 

– 

150 

Total 

£’000

4,618

3,959

485

(575)

8,487

2,085

993

(575)

2,503

Total 

£’000

5,065

1,116

(861)

5,320

2,382

947

(861)

2,468

2,852

(319)

2,533

–

–

–

–

–

–

35

–

–

35

–

–

–

–

35

–

35

Less intangible assets transferred to 

non-current assets and disposal 

groups held for sale at 30 June 2011 

Net book amount at 30 June 2011 

carried forward 

285 

2,287

– 

(307)

285 

1,980

The group tests intangible assets annually for impairment, or more frequently if there are indications of impairment. A discounted cash 

flow analysis is computed to compare the discounted estimated future operating cash flows to the net carrying value of the goodwill 

and other intangible assets for each operating segment or business as appropriate. 

The tests are based on the following assumptions: 

•  Cash flows for the 12 months are based upon the group’s annual budget; 

•  Cash flows beyond the budget period are based on the annual budget cash flows with a growth rate of 2%; 

•  The estimated cash flows are discounted using a pre-tax discounted rate based upon the group’s estimated weighted average cost 

Any impairments identified as a result of the analysis are expensed to the income statement. The test is dependent on management 

estimates and judgements, in particular in relation to the forecasting of future cash flows, and the discount rate applied to these 

of capital of 10%. 

cash flows. 

The group performed various sensitivity analyses which involved reducing future cash flows by up to 25%, reducing terminal growth rates 

by up to five percentage points, or increasing pre-tax discount rates by up to 100 bps. The results of these analyses showed that, despite 

significantly lower post-tax operating cash flows, or increased pre-tax discount rates, the carrying value of goodwill and other intangible 

assets continued to exceed their value in use.

015702_FW_Thorpe_18-68.indd   44

10/10/2012   15:49

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

6 Net financial income 

Finance income 

Current assets 

Interest receivable 

Non-current assets 

Net rental income 

Dividend income on available-for-sale financial assets 

Net interest on pension scheme assets and liabilities 

7 Income tax expense 

Analysis of income tax expense in the year. 

Current tax 

Current tax on profits for the year 

Adjustments in respect of prior years 

Total current tax 

Deferred tax (note 22) 

Total deferred tax 

Income tax expense 

The differences are explained below: 

Origination and reversal of temporary differences 

The tax assessed for the year is lower (2011: higher) than the standard rate of corporation tax in the UK of 25.5% (2011: 27.5%). 

Profit on ordinary activities multiplied by the standard rate in the UK of 25.5% (2011: 27.5%) 

Profit before tax 

Effects of: 

Other 

Tax charge 

8 Dividends 

Expenses not deductible for tax purposes 

Accelerated tax allowances and other timing differences 

Adjustments in respect of prior years 

Profits taxed at small companies rate 

The weighted average applicable tax rate was 21.5% (2011: 27.6%). 

A final dividend in respect of the year ended 30 June 2012 of 14.6p per share, amounting to a total dividend of £1,712,000, is to be 

proposed at the Annual General Meeting on 15 November 2012. These financial statements do not reflect this dividend payable. 

2012

£’000

2011

£’000

387

79

197

168

831

258

16

65

33

372

2012

£’000

2011

£’000

2,699

(57)

2,642

76

76

2,718

2,669

6

2,675

526

526

3,201

2012

£’000

2011

£’000

12,658

11,613

3,228

3,194

18

(356)

(57)

(3)

(112)

2,718

44

(116)

6

(2)

75

3,201

FW Thorpe Plc
Annual	Report	and	Accounts	2012

45

9 Intangible assets 

Group 2012 

Cost 
At 1 July 2011 
Additions 
Acquisition of subsidiary (note 28) 
Write-offs 
At 30 June 2012 

Accumulated amortisation 
At 1 July 2011  
Charge for the year 
Write-offs 
At 30 June 2012 
Net book amount 
At 30 June 2012 

Goodwill  
£’000 

Development 
costs 
£’000

Technology 
£’000

Brand name 
£’000

Software 
£’000

Patents  
£’000 

885 
2,618 
– 
– 
3,503 

600 
– 
– 
600 

2,961
1,052
–
(575)
3,438

982
753
(575)
1,160

–
–
311
–
311

–
62
–
62

–
–
174
–
174

–
58
–
58

2,903 

2,278

249

116

587
142
–
–
729

503
90
–
593

136

Fishing 
rights 
£’000

35
147
–
–
182

–
–
–
–

Total 
£’000

4,618
3,959
485
(575)
8,487

2,085
993
(575)
2,503

150 
– 
– 
– 
150 

– 
30 
– 
30 

120 

182

5,984

Write-offs relate to development assets where no further economic benefits will be obtained. 

Group 2011 

Cost 
At 1 July 2010 
Additions 
Write-offs 
At 30 June 2011 

Accumulated amortisation 
At 1 July 2010  
Charge for the year 
Write-offs 
At 30 June 2011 
Net book amount 
At 30 June 2011 
Less intangible assets transferred to 
non-current assets and disposal 
groups held for sale at 30 June 2011 
Net book amount at 30 June 2011 
carried forward 

Goodwill  
£’000 

Development 
costs 
£’000

Technology 
£’000

Brand name 
£’000

Software 
£’000

Patents  
£’000 

Fishing 
rights 
£’000

885 
– 
– 
885 

600 
– 
– 
600 

3,561
930
(861)
3,630

1,320
884
(861)
1,343

285 

2,287

– 

(307)

285 

1,980

–
–
–
–

–
–
–
–

–

–

–

–
–
–
–

–
–
–
–

–

–

–

584
36
–
620

462
63
–
525

95

(12)

83

– 
150 
– 
150 

– 
– 
– 
– 

150 

– 

150 

35
–
–
35

–
–
–
–

35

–

35

Total 
£’000

5,065
1,116
(861)
5,320

2,382
947
(861)
2,468

2,852

(319)

2,533

The group tests intangible assets annually for impairment, or more frequently if there are indications of impairment. A discounted cash 
flow analysis is computed to compare the discounted estimated future operating cash flows to the net carrying value of the goodwill 
and other intangible assets for each operating segment or business as appropriate. 

The dividends paid in 2012 and 2011 were £2,122,000 (18.1p per share) and £1,981,000 (16.9p per share) respectively.  

The tests are based on the following assumptions: 

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•  Cash flows for the 12 months are based upon the group’s annual budget; 

•  Cash flows beyond the budget period are based on the annual budget cash flows with a growth rate of 2%; 

•  The estimated cash flows are discounted using a pre-tax discounted rate based upon the group’s estimated weighted average cost 

of capital of 10%. 

Any impairments identified as a result of the analysis are expensed to the income statement. The test is dependent on management 
estimates and judgements, in particular in relation to the forecasting of future cash flows, and the discount rate applied to these 
cash flows. 

The group performed various sensitivity analyses which involved reducing future cash flows by up to 25%, reducing terminal growth rates 
by up to five percentage points, or increasing pre-tax discount rates by up to 100 bps. The results of these analyses showed that, despite 
significantly lower post-tax operating cash flows, or increased pre-tax discount rates, the carrying value of goodwill and other intangible 
assets continued to exceed their value in use.

015702_FW_Thorpe_18-68.indd   45

10/10/2012   15:49

	
	
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
46

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ACCOUNTS 

9 Intangible assets continued 

10 Property, plant and equipment 

Company 2012 

Cost 
At 1 July 2011 
Additions 
Write-offs 
At 30 June 2012 

Accumulated amortisation 
At 1 July 2011  
Charge for the year 
Write-offs 
At 30 June 2012 
Net book amount 
At 30 June 2012 

Company 2011 

Cost 
At 1 July 2010 
Additions 
Write-offs 
At 30 June 2011 

Accumulated amortisation 
At 1 July 2010  
Charge for the year 
Write-offs 
At 30 June 2011 
Net book amount 
At 30 June 2011 

Goodwill 
£’000

Development 
costs 
£’000

Software 
£’000

Patents  
£’000 

Fishing  
rights  
£’000 

600
–
–
600

600
–
–
600

2,618
979
(480)
3,117

846
670
(480)
1,036

–

2,081

442
135
–
577

385
73
–
458

119

600
–
–
600

600
–
–
600

2,301
740
(423)
2,618

699
570
(423)
846

–

1,772

424
18
–
442

346
39
–
385

57

Total 
£’000

3,845
1,261
(480)
4,626

1,831
773
(480)
2,124

Total 
£’000

3,360
908
(423)
3,845

1,645
609
(423)
1,831

150 
– 
– 
150 

– 
30 
– 
30 

35 
147 
– 
182 

– 
– 
– 
– 

– 
150 
– 
150 

– 
– 
– 
– 

35 
– 
– 
35 

– 
– 
– 
– 

150 

35 

2,014

120 

182 

2,502

Goodwill 
£’000

Development 
costs 
£’000

Software 
£’000

Patents  
£’000 

Fishing  
rights  
£’000 

Amortisation of £993,000 (2011: £733,000) is included in the administration costs. 

For development costs, the group capitalises employee costs and directly attributable material costs necessary to design, construct and 
test new and improved product ranges and technology. These costs are only capitalised where they meet all the criteria set out in IAS 38. 

Where development costs relate to products or technologies that are not expected to generate future economic benefits, do not meet 
the requirements of IAS 38 or relate to research, they are charged to the income statement. 

015702_FW_Thorpe_18-68.indd   46

10/10/2012   15:49

Cost 

At 1 July 2011  

Additions 

Acquisition of subsidiary (note 28) 

Transferred to investment property 

Disposals 

At 30 June 2012 

Accumulated depreciation 

At 1 July 2011 

Charge for the year 

Transferred to investment property 

Disposals 

At 30 June 2012 

Net book amount 

At 30 June 2012 

Accumulated depreciation 

Cost 

At 1 July 2010  

Additions 

Disposals 

At 30 June 2011 

At 1 July 2010 

Charge for the year 

Disposals 

At 30 June 2011 

Net book amount 

At 30 June 2011 

Group 

Company 

Freehold land 

and buildings

Plant and 

equipment

£’000

£’000

Freehold land 

and buildings 

Plant and 

equipment

£’000 

£’000

Total

£’000

9,744

708

(1,245)

–

–

2,018

175

(257)

–

12,766

1,438

69

(33)

(340)

22,510

2,146

69

(1,278)

(340)

9,744 

708 

10,094

1,230

(1,245) 

– 

– 

–

(33)

(257)

9,207

13,900

23,107

9,207 

11,034

20,241

9,383

887

(12)

(291)

11,401

1,062

(269)

(291)

2,018 

175 

(257) 

– 

1,936 

7,391

651

(12)

(216)

7,814

1,936

9,967

11,903

7,271

3,933

11,204

7,271 

3,220

10,491

Freehold land 

and buildings

£’000

Group 

Plant and 

equipment

£’000

Freehold land 

and buildings 

£’000 

Total

£’000

Company 

Plant and 

equipment

£’000

9,608

136

–

9,744

1,848

170

–

14,296

2,081

(620)

15,757

11,422

969

(556)

2,018

11,835

23,904

2,217

(620)

25,501

13,270

1,139

(556)

13,853

9,608 

136 

– 

9,096

1,354

(356)

9,744 

10,094

1,848 

170 

– 

2,018 

7,143

551

(303)

7,391

Total

£’000

19,838

1,938

–

(1,278)

(257)

9,409

826

(269)

(216)

9,750

Total

£’000

18,704

1,490

(356)

19,838

8,991

721

(303)

9,409

Freehold land which was not depreciated at 30 June 2012 amounted to £947,000 (2011: £1,218,000) (group and company). 

Following the disposal of a subsidiary company which rented a group property, the company and group has reclassified this property as 

an investment property. 

Less property, plant and equipment transferred to non-current 

assets and disposal groups held for sale at 30 June 2011 

Net book amount at 30 June 2011 carried forward 

7,726

3,922

11,648

7,726 

2,703

10,429

–

7,726

(539)

3,383

(539)

11,109

– 

7,726 

–

–

2,703

10,429

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

Accumulated amortisation 

Company 2012 

Cost 

At 1 July 2011 

Additions 

Write-offs 

At 30 June 2012 

At 1 July 2011  

Charge for the year 

Write-offs 

At 30 June 2012 

Net book amount 

At 30 June 2012 

Company 2011 

Cost 

At 1 July 2010 

Additions 

Write-offs 

At 30 June 2011 

At 1 July 2010  

Charge for the year 

Write-offs 

At 30 June 2011 

Net book amount 

At 30 June 2011 

Accumulated amortisation 

Total 

£’000

3,845

1,261

(480)

4,626

1,831

773

(480)

2,124

Total 

£’000

3,360

908

(423)

3,845

1,645

609

(423)

1,831

35 

147 

– 

182 

– 

– 

– 

– 

35 

– 

– 

35 

– 

– 

– 

– 

150 

– 

– 

150 

– 

30 

– 

30 

150 

– 

– 

150 

– 

– 

– 

– 

600

600

600

600

–

–

–

–

–

600

600

600

600

–

–

–

–

–

2,618

979

(480)

3,117

846

670

(480)

1,036

2,081

2,301

740

(423)

2,618

699

570

(423)

846

1,772

442

135

–

577

385

73

–

458

119

424

18

–

442

346

39

–

385

57

120 

182 

2,502

Development 

Goodwill 

£’000

costs 

£’000

Software 

£’000

Patents  

£’000 

Fishing  

rights  

£’000 

Amortisation of £993,000 (2011: £733,000) is included in the administration costs. 

For development costs, the group capitalises employee costs and directly attributable material costs necessary to design, construct and 

test new and improved product ranges and technology. These costs are only capitalised where they meet all the criteria set out in IAS 38. 

Where development costs relate to products or technologies that are not expected to generate future economic benefits, do not meet 

the requirements of IAS 38 or relate to research, they are charged to the income statement. 

150 

35 

2,014

9 Intangible assets continued 

10 Property, plant and equipment 

Development 

Goodwill 

£’000

costs 

£’000

Software 

£’000

Patents  

£’000 

Fishing  

rights  

£’000 

Cost 
At 1 July 2011  
Additions 
Acquisition of subsidiary (note 28) 
Transferred to investment property 
Disposals 
At 30 June 2012 

Accumulated depreciation 
At 1 July 2011 
Charge for the year 
Transferred to investment property 
Disposals 
At 30 June 2012 
Net book amount 
At 30 June 2012 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

47

Freehold land 
and buildings
£’000

Group 

Plant and 
equipment
£’000

Company 

Freehold land 
and buildings 
£’000 

Plant and 
equipment
£’000

Total
£’000

Total
£’000

9,744
708
–
(1,245)
–
9,207

2,018
175
(257)
–
1,936

12,766
1,438
69
(33)
(340)
13,900

9,383
887
(12)
(291)
9,967

22,510
2,146
69
(1,278)
(340)
23,107

11,401
1,062
(269)
(291)
11,903

9,744 
708 
– 
(1,245) 
– 
9,207 

2,018 
175 
(257) 
– 
1,936 

10,094
1,230
–
(33)
(257)
11,034

7,391
651
(12)
(216)
7,814

19,838
1,938
–
(1,278)
(257)
20,241

9,409
826
(269)
(216)
9,750

7,271

3,933

11,204

7,271 

3,220

10,491

Freehold land which was not depreciated at 30 June 2012 amounted to £947,000 (2011: £1,218,000) (group and company). 

Following the disposal of a subsidiary company which rented a group property, the company and group has reclassified this property as 
an investment property. 

Cost 
At 1 July 2010  
Additions 
Disposals 
At 30 June 2011 

Accumulated depreciation 
At 1 July 2010 
Charge for the year 
Disposals 
At 30 June 2011 
Net book amount 
At 30 June 2011 
Less property, plant and equipment transferred to non-current 
assets and disposal groups held for sale at 30 June 2011 
Net book amount at 30 June 2011 carried forward 

Freehold land 
and buildings
£’000

Group 
Plant and 
equipment
£’000

Freehold land 
and buildings 
£’000 

Total
£’000

Company 

Plant and 
equipment
£’000

9,608
136
–
9,744

1,848
170
–
2,018

14,296
2,081
(620)
15,757

11,422
969
(556)
11,835

23,904
2,217
(620)
25,501

13,270
1,139
(556)
13,853

9,608 
136 
– 
9,744 

1,848 
170 
– 
2,018 

9,096
1,354
(356)
10,094

7,143
551
(303)
7,391

Total
£’000

18,704
1,490
(356)
19,838

8,991
721
(303)
9,409

7,726

3,922

11,648

7,726 

2,703

10,429

–
7,726

(539)
3,383

(539)
11,109

– 
7,726 

–
2,703

–
10,429

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015702_FW_Thorpe_18-68.indd   47

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48

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ACCOUNTS 

11 Commitments 
(a) Capital commitments 
Capital expenditure contracted for at the balance sheet date but not yet incurred is as follows: 

Property, plant and equipment 

Group 

2012
£’000

56

2011 
£’000 

648 

Company 
2012
£’000

56

2011
£’000

635

(b) Operating lease commitments 
The group leases premises under non-cancellable operating lease agreements. The lease terms are between five and twenty years 
(2011: five and twenty years), and the lease agreements are renewable at the end of the lease period at market rate. 

The future aggregate minimum lease payments under non-cancellable operating leases are as follows: 

Within one year 
Within two to five years 
Over five years 

Group 

Land and 
buildings
2012
£’000

Land and 
buildings  
2011 
£’000 

Other 
2012
£’000

Other 
2011
£’000

124
321
102
547

46 
80 
– 
126 

–
–
–
–

–
–
–
–

12 Financial instruments by category 
All financial instruments measured at fair value are categorised as level 2 in the fair value measurement hierarchy, whereby the fair 
value is determined by using valuation techniques, except for £2,228,000 (2011: £1,492,000) of fixed rate listed investments included 
in available-for-sale and other financial assets at fair value through profit or loss that are classified as level 1. The valuation techniques 
for level 2 instruments use observable market data where it is available, for example quoted market prices, and rely less on estimates. 

The accounting policies for financial instruments have been applied to the line items below: 

Group  

30 June 2012 
Assets as per balance sheet 
Loans and other receivables 
Available-for-sale financial assets 
Other financial assets at fair value through profit or loss 
Trade and other receivables 
Short-term financial assets – deposits 
Cash and cash equivalents 
Total 

Loans and 
receivables 
£’000

Available- 
for-sale  
£’000 

Assets at 
fair value 
through the 
profit 
and loss
£’000

1,828
–
–
10,154
17,108
14,120
43,210

– 
1,841 
– 
– 
– 
– 
1,841 

–
–
387
–
–
–
387

Total
£’000

1,828
1,841
387
10,154
17,108
14,120
45,438

12 Financial instruments by category continued 

Group  

30 June 2011 

Assets as per balance sheet 

Available-for-sale financial assets 

Other financial assets at fair value through profit or loss 

Trade and other receivables 

Short-term financial assets – deposits 

Cash and cash equivalents 

Total 

Company  

30 June 2012 

Assets as per balance sheet 

Loans and other receivables 

Available-for-sale financial assets 

Other financial assets at fair value through profit or loss 

Trade and other receivables 

Short-term financial assets – deposits 

Short-term financial assets – cash and cash equivalents 

Total 

Company  

30 June 2011 

Assets as per balance sheet 

Available-for-sale financial assets 

Other financial assets at fair value through profit or loss 

Trade and other receivables 

Short-term financial assets – deposits 

Short-term financial assets – cash and cash equivalents 

Total 

The above analysis excludes prepayments. 

Liabilities as per balance sheet 

Trade and other payables (excluding statutory liabilities) 

Total

£’000

1,105

387

10,748

11,616

14,236

38,092

Total

£’000

1,828

1,841

387

10,493

17,108

14,081

45,738

Total

£’000

1,105

387

11,674

11,616

14,260

39,042

Loans and 

receivables

£’000

Available- 

for-sale 

£’000 

Assets at fair 

value through 

the profit 

and loss

£’000

–

–

10,748

11,616

14,236

36,600

1,105 

– 

– 

– 

– 

387

–

–

–

–

1,105 

387

Loans and 

receivables

£’000

Available- 

for-sale 

£’000 

Assets at 

fair value 

through the 

profit 

and loss 

£’000

1,828

–

–

10,493

17,108

14,081

43,510

1,841 

– 

– 

– 

– 

– 

387

–

–

–

–

–

1,841 

387

Loans and 

receivables

£’000

Available- 

for-sale 

£’000 

Assets at fair 

value through 

the profit 

and loss

£’000

1,105 

– 

– 

– 

– 

387

–

–

–

–

1,105 

387

–

–

11,674

11,616

14,260

37,550

2012

£’000

6,659

6,659

Group 

Company 

2011  

£’000 

7,036 

7,036 

2012 

£’000

7,948

7,948

2011 

£’000

9,271

9,271

The group and company did not have derivative financial instruments at 30 June 2012 or 30 June 2011. 

All assets and liabilities above are considered to be at fair value. 

015702_FW_Thorpe_18-68.indd   48

10/10/2012   15:49

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

11 Commitments 

(a) Capital commitments 

Capital expenditure contracted for at the balance sheet date but not yet incurred is as follows: 

Property, plant and equipment 

(b) Operating lease commitments 

The group leases premises under non-cancellable operating lease agreements. The lease terms are between five and twenty years 

(2011: five and twenty years), and the lease agreements are renewable at the end of the lease period at market rate. 

The future aggregate minimum lease payments under non-cancellable operating leases are as follows: 

Within one year 

Within two to five years 

Over five years 

12 Financial instruments by category 

All financial instruments measured at fair value are categorised as level 2 in the fair value measurement hierarchy, whereby the fair 

value is determined by using valuation techniques, except for £2,228,000 (2011: £1,492,000) of fixed rate listed investments included 

in available-for-sale and other financial assets at fair value through profit or loss that are classified as level 1. The valuation techniques 

for level 2 instruments use observable market data where it is available, for example quoted market prices, and rely less on estimates. 

The accounting policies for financial instruments have been applied to the line items below: 

Group 

Company 

2012

£’000

56

2011 

£’000 

648 

2012

£’000

56

2011

£’000

635

Group 

Land and 

buildings

2012

£’000

Land and 

buildings  

2011 

£’000 

Other 

2012

£’000

Other 

2011

£’000

124

321

102

547

46 

80 

– 

126 

–

–

–

–

–

–

–

–

Loans and 

receivables 

£’000

Available- 

for-sale  

£’000 

Assets at 

fair value 

through the 

profit 

and loss

£’000

1,828

–

–

10,154

17,108

14,120

43,210

1,841 

– 

– 

– 

– 

– 

387

–

–

–

–

–

1,841 

387

Total

£’000

1,828

1,841

387

10,154

17,108

14,120

45,438

Group  

30 June 2012 

Assets as per balance sheet 

Loans and other receivables 

Available-for-sale financial assets 

Trade and other receivables 

Short-term financial assets – deposits 

Cash and cash equivalents 

Total 

Other financial assets at fair value through profit or loss 

12 Financial instruments by category continued 

Group  

30 June 2011 
Assets as per balance sheet 
Available-for-sale financial assets 
Other financial assets at fair value through profit or loss 
Trade and other receivables 
Short-term financial assets – deposits 
Cash and cash equivalents 
Total 

Company  

30 June 2012 
Assets as per balance sheet 
Loans and other receivables 
Available-for-sale financial assets 
Other financial assets at fair value through profit or loss 
Trade and other receivables 
Short-term financial assets – deposits 
Short-term financial assets – cash and cash equivalents 
Total 

Company  

30 June 2011 
Assets as per balance sheet 
Available-for-sale financial assets 
Other financial assets at fair value through profit or loss 
Trade and other receivables 
Short-term financial assets – deposits 
Short-term financial assets – cash and cash equivalents 
Total 

The above analysis excludes prepayments. 

Liabilities as per balance sheet 

Trade and other payables (excluding statutory liabilities) 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

49

Loans and 
receivables
£’000

Available- 
for-sale 
£’000 

Assets at fair 
value through 
the profit 
and loss
£’000

–
–
10,748
11,616
14,236
36,600

1,105 
– 
– 
– 
– 
1,105 

–
387
–
–
–
387

Loans and 
receivables
£’000

Available- 
for-sale 
£’000 

Assets at 
fair value 
through the 
profit 
and loss 
£’000

1,828
–
–
10,493
17,108
14,081
43,510

– 
1,841 
– 
– 
– 
– 
1,841 

–
–
387
–
–
–
387

Loans and 
receivables
£’000

Available- 
for-sale 
£’000 

Assets at fair 
value through 
the profit 
and loss
£’000

–
387
–
–
–
387

–
–
11,674
11,616
14,260
37,550

Group 

2012
£’000

6,659
6,659

1,105 
– 
– 
– 
– 
1,105 

2011  
£’000 

7,036 
7,036 

Company 
2012 
£’000

7,948
7,948

2011 
£’000

9,271
9,271

Total
£’000

1,105
387
10,748
11,616
14,236
38,092

Total
£’000

1,828
1,841
387
10,493
17,108
14,081
45,738

Total
£’000

1,105
387
11,674
11,616
14,260
39,042

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The group and company did not have derivative financial instruments at 30 June 2012 or 30 June 2011. 

All assets and liabilities above are considered to be at fair value. 

015702_FW_Thorpe_18-68.indd   49

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50

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

13 Investment property 

Group and company 

At 1 July  
Addition 
Transferred from property, plant and equipment 
At 30 June 

The following amounts have been recognised in the income statement: 

Group and company 

Rental income 
Direct operating expenses arising from investment properties that generate rental income 

2012 
£’000

1,037
35
1,009
2,081

2012 
£’000

69
(8)

2011 
£’000

1,006
31
–
1,037

2011 
£’000

5
(12)

The investment property and land consists of property held for investment purposes, a property with land and fishing rights by the river 
Wye, and land designated for woodland in Monmouthshire.  

Investment property of £1,288,000 (2011: £992,000) is freehold land and therefore not depreciated; the property element includes 
accumulated depreciation of £269,000 (2011: £nil). The associated fishing rights for the property by the river Wye are included in 
intangible assets. 

A fair value exercise was undertaken in September 2011 of the land by the river Wye and the land in Monmouthshire which has resulted 
in a valuation of £1.2m. 

Each investment property generates rental income. 

14 Available-for-sale financial assets 

Group and company 

Beginning of year 
Additions 
Revaluation 

End of year 

There were no impairment provisions on available-for-sale financial assets in 2012 or 2011. 

Available-for-sale financial assets comprise listed equity in the UK, and denominated in UK pounds. 

None of these assets is either past due or impaired. 

15 Deposits 

Group and company 

Beginning of year 
Net additions/(disposals) 
End of year 

2012 
£’000

1,105
707
29

1,841

2011 
£’000

78
990
37

1,105

2012 
£’000

11,616
5,492
17,108

2011 
£’000

16,058
(4,442)
11,616

The short-term financial assets consist of term cash deposits in sterling with an original term in excess of three months. 

The banks where the deposits are held are rated “A” by Fitch, with a specific rating of F1 for short-term funds. 

16 Cash and cash equivalents 

Cash at bank and on hand 

Group 

2012 
£’000

2011  
£’000 

Company 
2012 
£’000

2011 
£’000

14,120

14,236 

14,081

14,260

The banks where the funds are held are rated “A” by Fitch, with a specific rating of F1 for short-term funds. 

015702_FW_Thorpe_18-68.indd   50

10/10/2012   15:49

The cost of inventories recognised as an expense and included in cost of sales amounted to £22,733,000 (2011: £21,896,000). 

ACCOUNTS 

17 Inventories 

Raw materials 

Work in progress 

Finished goods 

18 Trade and other receivables 

Current 

Trade receivables  

Other debtors 

Prepayments and accrued income 

Amounts owed by subsidiaries 

Bad debts written off  

Bad debts recovered  

Net bad debt expense 

Due in £ sterling  

Due in € euro  

Due in Australian dollars 

Total trade receivables  

Group 

Company 

2012 

£’000

6,784

1,739

2,621

2011  

£’000 

6,832 

1,561 

2,904 

11,144

11,297 

2012 

£’000

5,175

1,537

2,545

9,257

2011 

£’000

4,845

1,376

2,928

9,149

Group 

2012 

£’000

Company 

2011  

£’000 

2012 

£’000

2011 

£’000

9,752

10,687 

8,021

402

788

–

61 

629 

– 

402

549

2,070

11,042

10,942

11,377 

8,929

84

442

2,661

12,116

Group 

Company 

2012 

£’000

299

2011  

£’000 

321 

2012 

£’000

98

2011 

£’000

72

Group 

Company 

2012 

£’000

64

(58)

6

2011  

£’000 

78 

(5) 

73 

2012 

£’000

59

(58)

1

Group 

2012 

£’000

Company 

2011  

£’000 

2012 

£’000

9,409

10,337 

7,690

244

99

198 

152 

232

99

9,752

10,687 

8,021

2011 

£’000

41

(5)

36

2011 

£’000

8,605

172

152

8,929

Amounts owed by subsidiaries are unsecured, interest free and have no fixed date for repayment. 

Trade receivables past due date not provided 

A significant proportion of the amounts past due date were settled shortly after the end of the financial year, and taken together with 

the credit insurance policy and good credit history, the directors considered that there is no impairment and the trade receivables are 

therefore stated at their fair value, which equals their book value. 

Provisions are made for bad debt when an undisputed debt is three months past due date or earlier if an adverse event occurs. 

A significant proportion of the trade receivables are insured. The policy covers 90% of the debt in the event of a claim for default. The bad 

debt provision includes the remaining 10% of the default in the event of a potential claim. No bad debt provision is made in respect of 

trade receivables from government departments or agencies. At 30 June 2012 the bad debt provision for the group amounted to £53,000 

(2011: £125,000) and for the company £52,000 (2011: £102,000). 

During the year the following amounts were written off: 

At 30 June 2012, trade receivables were due to the group and company in the following currency denominations. 

The other assets within trade and other receivables do not contain impaired assets. 

The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable mentioned above. The group 

does not hold any collateral as security. 

 
 
 
 
 
 
 
 
 
 
 
 
ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

Transferred from property, plant and equipment 

The following amounts have been recognised in the income statement: 

Direct operating expenses arising from investment properties that generate rental income 

The investment property and land consists of property held for investment purposes, a property with land and fishing rights by the river 

Wye, and land designated for woodland in Monmouthshire.  

Investment property of £1,288,000 (2011: £992,000) is freehold land and therefore not depreciated; the property element includes 

accumulated depreciation of £269,000 (2011: £nil). The associated fishing rights for the property by the river Wye are included in 

A fair value exercise was undertaken in September 2011 of the land by the river Wye and the land in Monmouthshire which has resulted 

Each investment property generates rental income. 

14 Available-for-sale financial assets 

There were no impairment provisions on available-for-sale financial assets in 2012 or 2011. 

Available-for-sale financial assets comprise listed equity in the UK, and denominated in UK pounds. 

None of these assets is either past due or impaired. 

13 Investment property 

Group and company 

At 1 July  

Addition 

At 30 June 

Group and company 

Rental income 

intangible assets. 

in a valuation of £1.2m. 

Group and company 

Beginning of year 

Additions 

Revaluation 

End of year 

15 Deposits 

Group and company 

Beginning of year 

Net additions/(disposals) 

End of year 

2012 

£’000

1,037

35

1,009

2,081

2012 

£’000

69

(8)

2011 

£’000

1,006

31

–

1,037

2011 

£’000

5

(12)

2012 

£’000

1,105

707

29

1,841

2011 

£’000

78

990

37

1,105

2012 

£’000

11,616

5,492

17,108

2011 

£’000

16,058

(4,442)

11,616

The short-term financial assets consist of term cash deposits in sterling with an original term in excess of three months. 

The banks where the deposits are held are rated “A” by Fitch, with a specific rating of F1 for short-term funds. 

16 Cash and cash equivalents 

Cash at bank and on hand 

Group 

2012 

£’000

Company 

2011  

£’000 

2012 

£’000

2011 

£’000

14,120

14,236 

14,081

14,260

The banks where the funds are held are rated “A” by Fitch, with a specific rating of F1 for short-term funds. 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

51

17 Inventories 

Raw materials 
Work in progress 
Finished goods 

Group 

2012 
£’000

6,784
1,739
2,621
11,144

2011  
£’000 

6,832 
1,561 
2,904 
11,297 

Company 
2012 
£’000

5,175
1,537
2,545
9,257

2011 
£’000

4,845
1,376
2,928
9,149

The cost of inventories recognised as an expense and included in cost of sales amounted to £22,733,000 (2011: £21,896,000). 

18 Trade and other receivables 

Current 

Trade receivables  
Other debtors 
Prepayments and accrued income 
Amounts owed by subsidiaries 

Group 

2012 
£’000

9,752
402
788
–
10,942

2011  
£’000 

10,687 
61 
629 
– 
11,377 

Company 
2012 
£’000

8,021
402
549
2,070
11,042

2011 
£’000

8,929
84
442
2,661
12,116

Amounts owed by subsidiaries are unsecured, interest free and have no fixed date for repayment. 

Trade receivables past due date not provided 

Group 

2012 
£’000

299

2011  
£’000 

321 

Company 
2012 
£’000

98

2011 
£’000

72

A significant proportion of the amounts past due date were settled shortly after the end of the financial year, and taken together with 
the credit insurance policy and good credit history, the directors considered that there is no impairment and the trade receivables are 
therefore stated at their fair value, which equals their book value. 

Provisions are made for bad debt when an undisputed debt is three months past due date or earlier if an adverse event occurs. 
A significant proportion of the trade receivables are insured. The policy covers 90% of the debt in the event of a claim for default. The bad 
debt provision includes the remaining 10% of the default in the event of a potential claim. No bad debt provision is made in respect of 
trade receivables from government departments or agencies. At 30 June 2012 the bad debt provision for the group amounted to £53,000 
(2011: £125,000) and for the company £52,000 (2011: £102,000). 

During the year the following amounts were written off: 

Bad debts written off  
Bad debts recovered  
Net bad debt expense 

Group 

2012 
£’000

64
(58)
6

2011  
£’000 

78 
(5) 
73 

At 30 June 2012, trade receivables were due to the group and company in the following currency denominations. 

Due in £ sterling  
Due in € euro  
Due in Australian dollars 
Total trade receivables  

Group 

2012 
£’000

9,409
244
99
9,752

2011  
£’000 

10,337 
198 
152 
10,687 

Company 
2012 
£’000

59
(58)
1

Company 
2012 
£’000

7,690
232
99
8,021

2011 
£’000

41
(5)
36

2011 
£’000

8,605
172
152
8,929

The other assets within trade and other receivables do not contain impaired assets. 

The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable mentioned above. The group 
does not hold any collateral as security. 

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015702_FW_Thorpe_18-68.indd   51

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52

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ACCOUNTS 

19 Other financial assets at fair value through profit and loss 
The group and company have units in a sterling cash fund. At 30 June 2012 this amounted to £387,000 (2011: £387,000). 

22 Deferred income tax 

Deferred income tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets against current tax 

liabilities and when the deferred income taxes relate to the same fiscal authority. The offset amounts are as follows: 

20 Trade and other payables 

Current 
Trade payables 
Social security and other taxes 
Other creditors 
Accruals and deferred income 
Amounts owed to subsidiaries 

Group 

2012 
£’000

3,675
1,018
2,298
686
–
7,677

2011  
£’000 

4,733 
1,163 
1,745 
558 
– 
8,199 

Company 
2012 
£’000

2011 
£’000

2,945
748
2,272
421
2,310
8,696

3,642
964
1,707
385
3,537
10,235

Deferred tax assets: 

– Deferred tax assets to be recovered after more than 12 months 

– Deferred tax asset to be recovered within 12 months 

Deferred tax liabilities: 

– Deferred tax liability to be recovered after more than 12 months 

– Deferred tax liability to be recovered within 12 months 

Amounts owed to subsidiaries are unsecured, interest free and have no fixed date of repayment. 

Net deferred tax liabilities  

21 Provisions for liabilities and charges 

The net movement on the deferred income tax account is as follows: 

WEEE provision 
Total 

Analysis of total provisions: 

Non-current 
Total 

Group 

2012 
£’000

102
102

Group 

2012 
£’000

102
102

2011  
£’000 

102 
102 

2011  
£’000 

102 
102 

Company 
2012 
£’000

102
102

Company 
2012 
£’000

102
102

2011 
£’000

102
102

2011 
£’000

102
102

WEEE provision 
A potential liability exists for the future cost of disposal of products under the WEEE legislation for a transitional period between the 
adoption of the WEEE legislation in the European Union in August 2005 and the effective date in the UK of 1 July 2007.  

From 1 July 2007 the group has followed Regulation 9 of the Legislation and amended the terms of sale to its customers so that the 
customer is responsible for the actual costs of WEEE at the time of disposal. 

Although the time scale of the utilisation of this provision cannot be predicted with certainty, it is expected that it will not be utilised 
before 30 June 2015. 

Group 

2012 

£’000

Company 

2011  

£’000 

2012 

£’000

2011 

£’000

Group 

Company 

15

–

15

(778)

–

(778)

(763)

2012 

£’000

(672)

(6)

(76)

48

(57)

(763)

£’000

224

(57)

(168)

20

19

(4)

–

15

–

–

55

–

55

106

(11)

150

27 

– 

27 

(699) 

– 

(699) 

(672) 

2011  

£’000 

(62) 

– 

(451) 

(182) 

23 

(672) 

£’000 

386 

– 

(238) 

(148) 

– 

– 

– 

– 

57 

– 

– 

32 

89 

(2) 

(6) 

81 

–

–

–

–

(723)

(723)

(723)

2012 

£’000

(688)

–

(79)

44

–

(723)

Other

£’000

12

–

–

8

–

–

(4)

(8)

Other 

£’000

627

(80)

(10)

18

555

(32)

24

547

81

–

81

(769)

–

(769)

(688)

2011 

£’000

28

–

(569)

(147)

–

(688)

Total 

£’000

622

(57)

(406)

(132)

27

(4)

(8)

15

Total 

£’000

684

(80)

45

50

699

72

7

778

Accelerated 

Retirement 

tax 

benefit 

depreciation

obligations 

Accelerated 

tax 

depreciation 

£’000

Fair value  

gains and 

losses  

£’000 

The movement in deferred income tax assets and liabilities during the year, without taking into consideration the offsetting of balances 

within the same tax jurisdiction, is as follows: 

Beginning of year 

Acquisition of subsidiary (note 28) 

Income statement charge  

Tax charged directly to equity 

Transferred to non-current assets and disposal groups for sale 

End of year 

Transferred to non-current assets and disposal groups for sale 

Deferred tax assets 

At 1 July 2010 

(Charged) to the income statement 

Credited/(charged) directly to equity 

At 1 July 2011 

(Charged) to the income statement 

Credited/(charged) directly to equity 

At 30 June 2012 

Deferred tax liabilities 

At 1 July 2010 

Transferred to non-current assets and disposal groups for sale 

Charged/(credited) to the income statement 

Charged/(credited) directly to equity 

At 1 July 2011 

Charged/(credited) to the income statement 

Charged/(credited) directly to equity 

At 30 June 2012 

015702_FW_Thorpe_18-68.indd   52

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20 Trade and other payables 

Current 

Trade payables 

Social security and other taxes 

Other creditors 

Accruals and deferred income 

Amounts owed to subsidiaries 

WEEE provision 

Total 

Analysis of total provisions: 

Non-current 

Total 

WEEE provision 

Group 

2012 

£’000

Company 

2011  

£’000 

2012 

£’000

2011 

£’000

3,675

1,018

2,298

686

–

7,677

4,733 

1,163 

1,745 

558 

– 

8,199 

2,945

748

2,272

421

2,310

8,696

3,642

964

1,707

385

3,537

10,235

Group 

Company 

2012 

£’000

102

102

2012 

£’000

102

102

2011  

£’000 

102 

102 

2011  

£’000 

102 

102 

2012 

£’000

102

102

2012 

£’000

102

102

2011 

£’000

102

102

2011 

£’000

102

102

Group 

Company 

A potential liability exists for the future cost of disposal of products under the WEEE legislation for a transitional period between the 

adoption of the WEEE legislation in the European Union in August 2005 and the effective date in the UK of 1 July 2007.  

From 1 July 2007 the group has followed Regulation 9 of the Legislation and amended the terms of sale to its customers so that the 

customer is responsible for the actual costs of WEEE at the time of disposal. 

Although the time scale of the utilisation of this provision cannot be predicted with certainty, it is expected that it will not be utilised 

before 30 June 2015. 

ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

53

19 Other financial assets at fair value through profit and loss 

The group and company have units in a sterling cash fund. At 30 June 2012 this amounted to £387,000 (2011: £387,000). 

22 Deferred income tax 
Deferred income tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets against current tax 
liabilities and when the deferred income taxes relate to the same fiscal authority. The offset amounts are as follows: 

Amounts owed to subsidiaries are unsecured, interest free and have no fixed date of repayment. 

Net deferred tax liabilities  

21 Provisions for liabilities and charges 

The net movement on the deferred income tax account is as follows: 

Deferred tax assets: 
– Deferred tax assets to be recovered after more than 12 months 
– Deferred tax asset to be recovered within 12 months 

Deferred tax liabilities: 
– Deferred tax liability to be recovered after more than 12 months 
– Deferred tax liability to be recovered within 12 months 

Beginning of year 
Acquisition of subsidiary (note 28) 
Income statement charge  
Tax charged directly to equity 
Transferred to non-current assets and disposal groups for sale 
End of year 

Group 

2012 
£’000

15
–
15

(778)
–
(778)
(763)

Group 

2012 
£’000

(672)
(6)
(76)
48
(57)
(763)

2011  
£’000 

27 
– 
27 

(699) 
– 
(699) 
(672) 

2011  
£’000 

(62) 
– 
(451) 
(182) 
23 
(672) 

Company 
2012 
£’000

2011 
£’000

–
–
–

(723)
–
(723)
(723)

Company 
2012 
£’000

(688)
–
(79)
44
–
(723)

81
–
81

(769)
–
(769)
(688)

2011 
£’000

28
–
(569)
(147)
–
(688)

The movement in deferred income tax assets and liabilities during the year, without taking into consideration the offsetting of balances 
within the same tax jurisdiction, is as follows: 

Deferred tax assets 

At 1 July 2010 
Transferred to non-current assets and disposal groups for sale 
(Charged) to the income statement 
Credited/(charged) directly to equity 
At 1 July 2011 
(Charged) to the income statement 
Credited/(charged) directly to equity 
At 30 June 2012 

Deferred tax liabilities 

At 1 July 2010 
Transferred to non-current assets and disposal groups for sale 
Charged/(credited) to the income statement 
Charged/(credited) directly to equity 
At 1 July 2011 
Charged/(credited) to the income statement 
Charged/(credited) directly to equity 
At 30 June 2012 

Accelerated 
tax 
depreciation
£’000

Retirement 
benefit 
obligations 
£’000 

224
(57)
(168)
20
19
(4)
–
15

386 
– 
(238) 
(148) 
– 
– 
– 
– 

Accelerated 
tax 
depreciation 
£’000

Fair value  
gains and 
losses  
£’000 

–
–
55
–
55
106
(11)
150

57 
– 
– 
32 
89 
(2) 
(6) 
81 

Other
£’000

12
–
–
(4)
8
–
(8)
–

Other 
£’000

627
(80)
(10)
18
555
(32)
24
547

Total 
£’000

622
(57)
(406)
(132)
27
(4)
(8)
15

Total 
£’000

684
(80)
45
50
699
72
7
778

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54

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

22 Deferred income tax continued 
The “other” deferred tax liabilities consist of deferred tax on development expenditure classified as an intangible asset. 

The deferred income tax charged to equity during the year is as follows: 

Tax on actuarial loss on retirement benefits scheme 
Tax on revaluation of available-for-sale assets 
Impact of deferred tax rate change 

Group 

2012 
£’000

–
(8)
56
48

2011  
£’000 

(148) 
(10) 
(24) 
(182) 

Company 
2012 
£’000

–
(8)
52
44

2011 
£’000

(148)
(10)
11
(147)

15,000,000 ordinary shares of 10p each (2011: 15,000,000 ordinary shares of 10p each) 

11,893,559 ordinary shares of 10p each (2011: 11,893,559 ordinary shares of 10p each) 

The ordinary shareholders each have one vote per share. 

23 Earnings per share 
Basic earnings per share for profit attributable to equity holders of the company 
Basic earnings per share is calculated by dividing the profit attributable to equity holders of the company by the weighted average 
number of ordinary shares in issue during the period. 

Weighted average number of ordinary 
shares in issue 

Profit attributable to equity holders 
of the company (£’000) 
Basic earnings per share (pence per share) 

Continuing operations 

Discontinued operations 

Total 

11,723,559 

11,723,559 

11,723,559 

2012

2011

2012

2011 

2012 

2011

9,940
84.8

8,412
71.8

1,377
11.7

999 
8.5 

11,317 
96.5 

9,411
80.3

Diluted earnings per share 
Diluted earnings per share are calculated by adjusting the weighted average number of ordinary shares outstanding to assume 
conversion of all dilutive potential ordinary shares. The company does not have any dilutive potential ordinary shares; hence there 
is no difference between basic earnings per share and dilutive earnings per share. 

Weighted average number of ordinary 
shares in issue for diluted earnings per share 

Profit attributable to equity holders 
of the company (£’000) 
Diluted earnings per share (pence per share) 

Continuing operations 

Discontinued operations 

Total 

11,723,559 

11,723,559 

11,723,559 

2012

2011

2012

2011 

2012 

2011

9,940
84.8

8,412
71.8

1,377
11.7

999 
8.5 

11,317 
96.5 

9,411
80.3

ACCOUNTS 

24 Share capital 

Authorised 

Allotted and fully paid  

Share capital at 1 July and 30 June 

Movements in treasury shares included in share capital 

Shares held in treasury at 1 July  

Share capital at 30 June  

Number of shares held in treasury at 30 June  

25 Other reserves 

Group and company 

At 30 June 2011 and 30 June 2012 

There were no shares issued during the year (2011: nil). There are no share options outstanding at the year end (2011: nil). 

Group and Company 

2012

£’000

2011

£’000

1,500

1,500

1,189

1,189

Group and Company 

2012

£’000

2011

£’000

1,189

1,189

Group and Company 

2012

£’000

2011

£’000

17

17

17

17

170,000

170,000

Share 

Capital 

premium 

redemption 

account

£’000

reserves

£’000

656

137

015702_FW_Thorpe_18-68.indd   54

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ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

22 Deferred income tax continued 

The “other” deferred tax liabilities consist of deferred tax on development expenditure classified as an intangible asset. 

The deferred income tax charged to equity during the year is as follows: 

24 Share capital 

Tax on actuarial loss on retirement benefits scheme 

Tax on revaluation of available-for-sale assets 

Impact of deferred tax rate change 

Group 

2012 

£’000

–

(8)

56

48

2011  

£’000 

(148) 

(10) 

(24) 

(182) 

Company 

2012 

£’000

–

(8)

52

44

2011 

£’000

(148)

(10)

11

(147)

Authorised 
15,000,000 ordinary shares of 10p each (2011: 15,000,000 ordinary shares of 10p each) 
Allotted and fully paid  
11,893,559 ordinary shares of 10p each (2011: 11,893,559 ordinary shares of 10p each) 

The ordinary shareholders each have one vote per share. 

23 Earnings per share 

Basic earnings per share for profit attributable to equity holders of the company 

Basic earnings per share is calculated by dividing the profit attributable to equity holders of the company by the weighted average 

number of ordinary shares in issue during the period. 

Share capital at 1 July and 30 June 

Movements in treasury shares included in share capital 
Shares held in treasury at 1 July  

Share capital at 30 June  

Number of shares held in treasury at 30 June  

FW Thorpe Plc
Annual	Report	and	Accounts	2012

55

Group and Company 

2012
£’000

2011
£’000

1,500

1,500

1,189

1,189

Group and Company 

2012
£’000

2011
£’000

1,189

1,189

Group and Company 

2012
£’000

2011
£’000

17

17

17

17

170,000

170,000

There were no shares issued during the year (2011: nil). There are no share options outstanding at the year end (2011: nil). 

25 Other reserves 

Group and company 

At 30 June 2011 and 30 June 2012 

Share 
premium 
account
£’000

Capital 
redemption 
reserves
£’000

656

137

Weighted average number of ordinary 

shares in issue 

Profit attributable to equity holders 

of the company (£’000) 

Basic earnings per share (pence per share) 

Diluted earnings per share 

Continuing operations 

Discontinued operations 

Total 

11,723,559 

11,723,559 

11,723,559 

2012

2011

2012

2011 

2012 

2011

9,940

84.8

8,412

71.8

1,377

11.7

999 

8.5 

11,317 

96.5 

9,411

80.3

Diluted earnings per share are calculated by adjusting the weighted average number of ordinary shares outstanding to assume 

conversion of all dilutive potential ordinary shares. The company does not have any dilutive potential ordinary shares; hence there 

is no difference between basic earnings per share and dilutive earnings per share. 

Weighted average number of ordinary 

shares in issue for diluted earnings per share 

11,723,559 

11,723,559 

11,723,559 

2012

2011

2012

2011 

2012 

2011

Continuing operations 

Discontinued operations 

Total 

Profit attributable to equity holders 

of the company (£’000) 

Diluted earnings per share (pence per share) 

9,940

84.8

8,412

71.8

1,377

11.7

999 

8.5 

11,317 

96.5 

9,411

80.3

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56

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ACCOUNTS 

26 Cash generated from operations 

Cash generated from continuing operations 

Profit before income tax 
Depreciation charge 
Amortisation of intangibles 
Profit on disposal of property, plant and equipment 
Finance income  
Retirement benefit contributions in excess of current and past service charge 
Share of loss from joint venture 
Changes in working capital 
– Inventories 
– Trade and other receivables 
– Trade and other payables 
Cash generated from continuing operations 

The cash generation from discontinued operations is as follows: 

Group 

2012
£’000

12,658
1,062
993
(71)
(831)
(774)
23

304
918
(1,583)
12,699

2011 
£’000 

11,613 
913 
733 
(42) 
(372) 
(776) 
11 

(2,843) 
(2,424) 
2,292 
9,105 

Cash generated from discontinued operations 

Profit before income tax 
Depreciation charge 
Amortisation of intangibles 
Profit on disposal of property, plant and equipment 
Finance income – net 
Changes in working capital 
– Inventories 
– Trade and other receivables 
– Trade and other payables 
Cash generated from discontinued operations 

Total cash generated from operations 

Continuing operations 
Discontinued operations 
Total cash generated from operations 

Company 
2012
£’000

13,469
826
773
(44)
(2,729)
(774)
–

(108)
1,127
(2,242)
10,298

2012
£’000

388
92
70
(1)
(1)

(84)
(439)
(33)
(8)

2012
£’000

12,699
(8)
12,691

2011
£’000

11,482
721
609
(35)
(1,165)
(776)
–

(1,977)
(2,341)
1,282
7,800

2011
£’000

1,333
226
214
(6)
(4)

(182)
303
(1,128)
756

2011
£’000

9,105
756
9,861

27 Related party transactions 

The following amounts relate to transactions between the company and its subsidiaries: 

2012 

Compact Lighting Ltd 

Philip Payne Ltd 

Sugg Lighting Ltd 

Solite Europe Ltd 

Portland Lighting Ltd 

2011 

Mackwell Electronics Ltd 

Compact Lighting Ltd 

Philip Payne Ltd 

Sugg Lighting Ltd 

Solite Europe Ltd 

Compact Lighting Ltd 

Philip Payne Ltd 

Sugg Lighting Ltd 

Solite Europe Ltd 

Portland Lighting Ltd 

Total 

(2011: £3,397,000). 

on pages 22 to 24. 

Purchases of 

goods

£’000

Sales of 

goods 

£’000 

Sales of 

services

£’000

Dividends 

paid to 

company

£’000

Purchases of 

Sales of  

goods 

£’000 

Sales of 

services

£’000

Dividends 

paid to 

company

£’000

38 

30 

1 

12 

– 

33 

46 

11 

7 

47 

51

339

7

79

–

goods

£’000

2,823

53

350

6

147

2012

£’000

(1)

–

(58)

(738)

18

4

1

2

–

4

3

1

18

2

1

–

–

43

143

98

–

–

282

32

111

–

66

–

–

–

Amounts due to related  

Amounts due from related 

party at 30 June 

party at 30 June 

(1,513)

(1,559) 

2011 

£’000 

2012

£’000

2011

£’000

(9) 

1,382

2,004

4,097

4,053

(177) 

– 

– 

(2,310)

(1,745) 

5,480

6,057

Balances due to and from the company by related entities were as follows: 

Trading balances arise from transactions of goods and services carried out under normal commercial terms. 

Cash resources are managed centrally by the company and result in balances owed to and from the company when cash is transferred. 

In addition to the balances stated above, the company has made a provision for losses at Sugg Lighting Ltd of £3,410,000 

The key management personnel are the group Board directors; their interests are disclosed in the directors’ remuneration report 

Although Mackwell Electronics Ltd was disposed of during the year, it remains a related party because there is a connection between a 

director of the company C M Brangwin and N A Brangwin who is a director of Mackwell Electronics Ltd. During the year the company 

sold goods to Mackwell amounting to £15,000 (2011: £33,000), purchased goods amounting to £2,328,000 (2011: £2,823,000), and sold 

services of £3,000 (2011: £4,000). At the year end there were no trade balances due to or from Mackwell Electronics Ltd (2011: £(1,792,000) 

and £1,000 respectively). The company is owed £2,000,000 in respect of the loan notes issued to the company as part of the sale 

agreement (note 29), plus accrued interest of £24,000 at the balance sheet date. Prior to the disposal a dividend of £1,416,000 was paid to 

the company (2011: £282,000). The company owns the premises occupied by Mackwell Electronics Ltd and rent is charged of £102,000 

per annum (2011: £102,000). The rent is comparable to commercial rents for similar buildings in the area. 

015702_FW_Thorpe_18-68.indd   56

10/10/2012   15:49

 
 
 
 
 
 
 
 
 
ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

26 Cash generated from operations 

Cash generated from continuing operations 

Profit before income tax 

Depreciation charge 

Amortisation of intangibles 

Profit on disposal of property, plant and equipment 

Finance income  

Retirement benefit contributions in excess of current and past service charge 

Share of loss from joint venture 

Changes in working capital 

– Inventories 

– Trade and other receivables 

– Trade and other payables 

Cash generated from continuing operations 

The cash generation from discontinued operations is as follows: 

Cash generated from discontinued operations 

Profit on disposal of property, plant and equipment 

Profit before income tax 

Depreciation charge 

Amortisation of intangibles 

Finance income – net 

Changes in working capital 

– Inventories 

– Trade and other receivables 

– Trade and other payables 

Cash generated from discontinued operations 

Total cash generated from operations 

Continuing operations 

Discontinued operations 

Total cash generated from operations 

Group 

2012

£’000

Company 

2011 

£’000 

2012

£’000

2011

£’000

11,613 

13,469

11,482

12,658

1,062

993

(71)

(831)

(774)

23

304

918

(1,583)

12,699

913 

733 

(42) 

(372) 

(776) 

11 

(2,843) 

(2,424) 

2,292 

9,105 

826

773

(44)

(2,729)

(774)

–

(108)

1,127

(2,242)

10,298

721

609

(35)

(1,165)

(776)

–

(1,977)

(2,341)

1,282

7,800

2011

£’000

1,333

226

214

(6)

(4)

(182)

303

(1,128)

756

2011

£’000

9,105

756

9,861

2012

£’000

388

92

70

(1)

(1)

(84)

(439)

(33)

(8)

2012

£’000

12,699

(8)

12,691

FW Thorpe Plc
Annual	Report	and	Accounts	2012

57

27 Related party transactions 
The following amounts relate to transactions between the company and its subsidiaries: 

2012 

Compact Lighting Ltd 
Philip Payne Ltd 
Sugg Lighting Ltd 
Solite Europe Ltd 
Portland Lighting Ltd 

2011 

Mackwell Electronics Ltd 
Compact Lighting Ltd 
Philip Payne Ltd 
Sugg Lighting Ltd 
Solite Europe Ltd 

Balances due to and from the company by related entities were as follows: 

Compact Lighting Ltd 
Philip Payne Ltd 
Sugg Lighting Ltd 
Solite Europe Ltd 
Portland Lighting Ltd 
Total 

Purchases of 
goods
£’000

Sales of 
goods 
£’000 

Sales of 
services
£’000

51
339
7
79
–

38 
30 
1 
12 
– 

4
1
18
2
–

Purchases of 
goods
£’000

Sales of  
goods 
£’000 

Sales of 
services
£’000

2,823
53
350
6
147

33 
46 
11 
7 
47 

4
3
1
18
2

Dividends 
paid to 
company
£’000

43
143
–
98
–

Dividends 
paid to 
company
£’000

282
32
111
–
66

Amounts due to related  
party at 30 June 

Amounts due from related 
party at 30 June 

2012
£’000

(1)
(1,513)
–
(58)
(738)
(2,310)

2011 
£’000 

(9) 
(1,559) 
– 
(177) 
– 
(1,745) 

2012
£’000

1,382
1
4,097
–
–
5,480

2011
£’000

2,004
–
4,053
–
–
6,057

Trading balances arise from transactions of goods and services carried out under normal commercial terms. 

Cash resources are managed centrally by the company and result in balances owed to and from the company when cash is transferred. 

In addition to the balances stated above, the company has made a provision for losses at Sugg Lighting Ltd of £3,410,000 
(2011: £3,397,000). 

The key management personnel are the group Board directors; their interests are disclosed in the directors’ remuneration report 
on pages 22 to 24. 

Although Mackwell Electronics Ltd was disposed of during the year, it remains a related party because there is a connection between a 
director of the company C M Brangwin and N A Brangwin who is a director of Mackwell Electronics Ltd. During the year the company 
sold goods to Mackwell amounting to £15,000 (2011: £33,000), purchased goods amounting to £2,328,000 (2011: £2,823,000), and sold 
services of £3,000 (2011: £4,000). At the year end there were no trade balances due to or from Mackwell Electronics Ltd (2011: £(1,792,000) 
and £1,000 respectively). The company is owed £2,000,000 in respect of the loan notes issued to the company as part of the sale 
agreement (note 29), plus accrued interest of £24,000 at the balance sheet date. Prior to the disposal a dividend of £1,416,000 was paid to 
the company (2011: £282,000). The company owns the premises occupied by Mackwell Electronics Ltd and rent is charged of £102,000 
per annum (2011: £102,000). The rent is comparable to commercial rents for similar buildings in the area. 

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58

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

28 Acquisition of subsidiary  
On 1 July 2011 the group acquired 100% of the share capital of Portland Lighting Ltd for an initial amount of £2,500,000. An additional 
amount of £234,000 has been paid, and a provision has been made for a contingent consideration of £754,000. The provision is based 
on the profitability of Portland Lighting for both 2011/2012 and the following year.  

The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are set out below. 

On 14 November 2011, the group entered into a sale agreement to dispose of Mackwell Electronics Ltd. The disposal was completed on 

2 December 2011, on which date control of Mackwell Electronics Ltd passed to the acquirer. The results of the discontinued operations, 

which have been included in the consolidated income statement were as follows: 

Cash  
Intangible assets 
Property, plant and equipment 
Inventories 
Trade and other receivables 
Trade and other payables 
Total identifiable assets 
Goodwill 
Total purchase consideration 

Total purchase consideration satisfied by: 
Cash 
Contingent consideration 
Total consideration 

Net cash outflow arising on acquisition 
Cash consideration 
Less cash in subsidiary acquired 
Cash outflow on acquisition 

£’000

232
485
69
150
413
(479)
870
2,618
3,488

2,734
754
3,488

2,734
(232)
2,502

A fair value exercise has been performed on the assets and liabilities, the results were that property, plant and equipment, inventories, 
trade and other receivables and trade and other payables were assessed and book value was considered fair value. 

Fair value of intangible assets was assessed and determined on the basis of the technology and brand name acquired. The technology 
element was determined using an industry typical royalty rate over a five year period discounted to the present day. The brand name 
element was determined by assessing the impact on profitability of a change in name over a three year period. 

The goodwill relates to the ongoing levels of profitability business model, established customer base and potential sourcing benefits for 
other group companies.  

The contingent consideration is based on EBIT performance for the financial year. £250,000 is payable if EBIT is greater than £500,000 for 
the year, a further amount is payable of 50% of EBIT in excess of £500,000. This agreement expires in two financial years from the original 
acquisition date.  

Portland Lighting Ltd contributed £2,458,000 in revenue, and £588,000 to the group’s operating profit for the period between the date 
of acquisition and the balance sheet date. 

015702_FW_Thorpe_18-68.indd   58

10/10/2012   15:49

ACCOUNTS 

29 Disposal of subsidiary 

Discontinued operations 

Revenue 

Expenses 

Profit before tax expense 

Attributable tax expense 

Profit on disposal of discontinued operations 

Attributable tax expense 

Period ended 

2 December 

Year ended 

30 June 2011

£’000

2011

£’000

4,342

(3,958)

384

(99)

1,092

–

1,377

9,669

(8,336)

1,333

(334)

–

–

999

Profit attributable to discontinued operations – (attributable to owners of the company) 

During the year Mackwell Electronics Ltd contributed £(8,000) (2011: £756,000) to the group’s net operating cash flows. 

A profit of £1,377,000 arose on the disposal of Mackwell Electronics Ltd, being the proceeds of disposal less the associated costs and the 

carrying amount of the subsidiary’s net assets and attributable goodwill. 

Disposal of subsidiary 

On 2 December 2011 the group disposed of its interest in Mackwell Electronics Ltd, a subsidiary company which had been classed as held 

for sale in the prior year. The net assets of Mackwell Electronics Ltd were £4,487,000 at the date of disposal. 

The gain on disposal of £1,092,000 resulted from total consideration of £6,500,000 less net assets of £4,487,000, costs of £749,000, less fair 

value adjustment of £172,000 in respect of the loan notes issued. 

The total consideration was satisfied by cash of £4,500,000 and loan notes issued of £2,000,000. 

The loan notes are repayable on 2 December 2016 and attract two different rates of interest; £1,625,000 at 1% over the Bank of England 

base rate and £375,000 at 4% over Bank of England base rate. 

The loan note tranche of £1,625,000 has been subject to a fair value adjustment in respect to the interest rate. The carrying value has 

been adjusted to reflect a commercial interest rate of 4.2% over Bank of England base rate, which is considered to be a rate that Mackwell 

Electronics Ltd would incur in the external market. The fair value of the loans is considered to be £1,453,000. 

The impact of Mackwell Electronics Ltd on the group’s results in the current and prior periods is disclosed in the section relating to 

discontinued operations.  

30 Pension scheme 

pension scheme. 

benefit pension. 

The group operates a funded hybrid pension scheme for employees in the UK. The scheme is approved by the Inland Revenue under 

Chapter 1 Part XIV of the Income and Corporation Taxes Act 1988. Membership is contracted in to the second state pension. 

The basis of the group’s hybrid pension scheme is to provide benefits to members based on the following: 

•  For service prior to 1 October 1995, the benefits provided are defined benefit in nature. 

•  For service from 1 October 1995, the benefits provided have two elements depending on the date that the member joined the 

•  For members joining before 1 October 1995, benefits provided are the higher of their defined contribution pension and their defined 

•  For members joining on or after 1 October 1995, benefits provided are defined contribution in nature. 

 
 
 
 
 
 
 
 
ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

59

28 Acquisition of subsidiary  

On 1 July 2011 the group acquired 100% of the share capital of Portland Lighting Ltd for an initial amount of £2,500,000. An additional 

amount of £234,000 has been paid, and a provision has been made for a contingent consideration of £754,000. The provision is based 

on the profitability of Portland Lighting for both 2011/2012 and the following year.  

The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are set out below. 

29 Disposal of subsidiary 
Discontinued operations 
On 14 November 2011, the group entered into a sale agreement to dispose of Mackwell Electronics Ltd. The disposal was completed on 
2 December 2011, on which date control of Mackwell Electronics Ltd passed to the acquirer. The results of the discontinued operations, 
which have been included in the consolidated income statement were as follows: 

Cash  

Intangible assets 

Property, plant and equipment 

Inventories 

Trade and other receivables 

Trade and other payables 

Total identifiable assets 

Goodwill 

Total purchase consideration 

Total purchase consideration satisfied by: 

Cash 

Contingent consideration 

Total consideration 

Net cash outflow arising on acquisition 

Cash consideration 

Less cash in subsidiary acquired 

Cash outflow on acquisition 

A fair value exercise has been performed on the assets and liabilities, the results were that property, plant and equipment, inventories, 

trade and other receivables and trade and other payables were assessed and book value was considered fair value. 

Fair value of intangible assets was assessed and determined on the basis of the technology and brand name acquired. The technology 

element was determined using an industry typical royalty rate over a five year period discounted to the present day. The brand name 

element was determined by assessing the impact on profitability of a change in name over a three year period. 

The goodwill relates to the ongoing levels of profitability business model, established customer base and potential sourcing benefits for 

other group companies.  

acquisition date.  

The contingent consideration is based on EBIT performance for the financial year. £250,000 is payable if EBIT is greater than £500,000 for 

the year, a further amount is payable of 50% of EBIT in excess of £500,000. This agreement expires in two financial years from the original 

Portland Lighting Ltd contributed £2,458,000 in revenue, and £588,000 to the group’s operating profit for the period between the date 

of acquisition and the balance sheet date. 

£’000

232

485

69

150

413

(479)

870

2,618

3,488

2,734

754

3,488

2,734

(232)

2,502

Revenue 
Expenses 
Profit before tax expense 
Attributable tax expense 
Profit on disposal of discontinued operations 
Attributable tax expense 
Profit attributable to discontinued operations – (attributable to owners of the company) 

Period ended 
2 December 
2011
£’000

Year ended 
30 June 2011
£’000

4,342
(3,958)
384
(99)
1,092
–
1,377

9,669
(8,336)
1,333
(334)
–
–
999

During the year Mackwell Electronics Ltd contributed £(8,000) (2011: £756,000) to the group’s net operating cash flows. 

A profit of £1,377,000 arose on the disposal of Mackwell Electronics Ltd, being the proceeds of disposal less the associated costs and the 
carrying amount of the subsidiary’s net assets and attributable goodwill. 

Disposal of subsidiary 
On 2 December 2011 the group disposed of its interest in Mackwell Electronics Ltd, a subsidiary company which had been classed as held 
for sale in the prior year. The net assets of Mackwell Electronics Ltd were £4,487,000 at the date of disposal. 

The gain on disposal of £1,092,000 resulted from total consideration of £6,500,000 less net assets of £4,487,000, costs of £749,000, less fair 
value adjustment of £172,000 in respect of the loan notes issued. 

The total consideration was satisfied by cash of £4,500,000 and loan notes issued of £2,000,000. 

The loan notes are repayable on 2 December 2016 and attract two different rates of interest; £1,625,000 at 1% over the Bank of England 
base rate and £375,000 at 4% over Bank of England base rate. 

The loan note tranche of £1,625,000 has been subject to a fair value adjustment in respect to the interest rate. The carrying value has 
been adjusted to reflect a commercial interest rate of 4.2% over Bank of England base rate, which is considered to be a rate that Mackwell 
Electronics Ltd would incur in the external market. The fair value of the loans is considered to be £1,453,000. 

The impact of Mackwell Electronics Ltd on the group’s results in the current and prior periods is disclosed in the section relating to 
discontinued operations.  

30 Pension scheme 
The group operates a funded hybrid pension scheme for employees in the UK. The scheme is approved by the Inland Revenue under 
Chapter 1 Part XIV of the Income and Corporation Taxes Act 1988. Membership is contracted in to the second state pension. 

The basis of the group’s hybrid pension scheme is to provide benefits to members based on the following: 

•  For service prior to 1 October 1995, the benefits provided are defined benefit in nature. 

•  For service from 1 October 1995, the benefits provided have two elements depending on the date that the member joined the 

pension scheme. 

•  For members joining before 1 October 1995, benefits provided are the higher of their defined contribution pension and their defined 

benefit pension. 

•  For members joining on or after 1 October 1995, benefits provided are defined contribution in nature. 

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015702_FW_Thorpe_18-68.indd   59

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60

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ACCOUNTS 

30 Pension scheme continued 
The contributions of the pure defined contribution, the defined benefit underpin and pure defined benefit elements are paid into one 
pension scheme, where the contributions and assets are segregated and ring-fenced from each other. 

For the defined benefit underpin element of the scheme, each member is tested to see whether the pension on a defined contribution 
or defined benefit basis is higher. The liabilities shown in the pensions note are based on the greater of the two liabilities for each member, 
which in almost all cases is the defined benefit liability. For the service cost, again, tests are performed to see which is the higher for each 
member out of the company’s share of the defined contribution payments or the company’s share of accruing benefits on a defined 
benefit basis. The higher of these two figures for each member is then used to give the total service cost; again the defined benefit cost 
is the higher for the vast majority of members. 

The assets of the scheme are held separately from the assets of the group, being invested in Managed Funds. Contributions by the group 
to the scheme during the year ended 30 June 2012 amounted to £1,340,000 (2011: £1,381,000). Contributions are determined by an 
independent qualified actuary on the basis of triennial valuations using the Project Unit Method. 

The date of the most recent actuarial valuation was 1 July 2012, and is in progress. The previous valuation was carried out on 1 July 2009 
and at that date the value of the fund was £17,169,000. This was sufficient to cover 83% of the value of the benefits accrued to members 
after allowing for future increases in earnings. In arriving at the actuarial valuation, the following assumptions were adopted. 

Price inflation 
Salary increases 
Discount rate 
Revaluation for deferred pensioners 
Pension increases in payment of 5% pa or RPI if less 
Pension increases in payment of 2.5% pa or RPI if less 

3.75% 
5.66% 
5.50% 
3.75% 
3.60% 
2.35% 

The figures at 1 July 2009 have been updated as at the balance sheet dates in order to assess the additional disclosures required under  
IAS 19 as at 30 June 2012 by an independent qualified actuary using the following major assumptions. 

The movement in the fair value of the plan assets of the year is as follows: 

Price inflation 
Salary increases 
Discount rate 
Revaluation for deferred pensioners 
Pension increases in payment of 5% pa or RPI if less 
Pension increases in payment of 2.5% pa or RPI if less 
Life expectancy at age 65 – men 
Life expectancy at age 65 in 20 years – men 
Life expectancy at age 65 – women 
Life expectancy at age 65 in 20 years – women  

The balance sheet figures required under IAS 19 are as follows: 

2012

2011

2010 

2009 

2008

2.80%
4.55%
4.40%
2.05%
2.75%
2.10%
22.5 years
24.4 years
24.9 years
26.8 years

3.70%
5.45%
5.50%
2.95%
3.55%
2.35%
22.4 years
24.4 years
24.8 years
26.7 years

3.50% 
5.25% 
5.35% 
3.50% 
3.30% 
2.20% 
22.3 years 
24.3 years 
24.7 years 
26.6 years 

3.75% 
5.66% 
6.00% 
3.75% 
3.60% 
2.35% 
22.2 years 

4.00%
5.89%
6.40%
4.00%
3.80%
2.40%
22.0 years

24.6 years 

24.9 years

30 June 2012 

30 June 2011 

30 June 2010 

30 June 2009 

30 June 2008 

Expected  
long-term  
rate of  
return 

Expected 
long-term 
rate of 
return

Value
£’000

Expected 
long-term 
rate of 
return

Value
£’000

Equities 
Bonds 
Property 
Other 
Total market value of assets 
Present value of scheme liabilities 
Surplus/(deficit) in the scheme 

– 
0.50% 

6.20% 
9,744
4.40%  12,484
–
1,596
  23,824
  (23,809)
15

–
0.50%

7.75% 11,166
5.00% 10,982
–
1,328
23,476
(22,993)
483

7.65%
4.84%
7.35%
0.50%

Expected  
long-term  
rate of  
return 

7.80% 
5.30% 
7.80% 
0.50% 

Expected 
long-term 
rate of 
return

7.75%
5.60%
7.75%
5.00%

Value 
£’000 

7,265 
8,066 
12 
1,832 
17,175 
(19,208) 
(2,033) 

Value
£’000

8,573
7,002
11
1,755
17,341
(17,622)
(281)

Value
£’000

9,045
9,464
19
1,565
20,093
(21,472)
(1,379)

The property assets have been amalgamated with equities for reporting purposes during the year ended 2011 due to their low value. 

015702_FW_Thorpe_18-68.indd   60

10/10/2012   15:49

30 Pension scheme continued 

The amounts recognised in the balance sheet are determined as follows: 

Present value of funded obligations 

Fair value of plan assets 

Surplus in the scheme 

Less restriction of surplus recognised in the balance sheet 

Liability recognised in the balance sheet 

The movement in the defined benefit obligation over the year is as follows: 

Contributions by plan participants 

At 1 July  

Current service cost 

Interest cost 

Actuarial losses 

Benefits paid 

At 30 June  

At 1 July  

Expected return in plan assets 

Actuarial gains/(losses) 

Employer contributions 

Employee contributions 

Benefits paid 

At 30 June  

Current service cost 

Interest cost 

Expected return on plan assets 

income” respectively. 

The amounts recognised in the income statement are as follows: 

2012

£’000

2011

£’000

(23,809)

23,824

(22,993)

23,476

(22,993)

(21,472)

(23,809)

(22,993)

15

(15)

–

2012

£’000

(566)

(1,220)

(350)

(1,603)

2,923

2012

£’000

23,476

1,388

193

1,340

350

(2,923)

23,824

2012

£’000

566

1,220

(1,388)

398

483

(483)

–

2011

£’000

(548)

(1,151)

(349)

(281)

808

2011

£’000

20,093

1,184

1,335

1,323

349

(808)

23,476

2011

£’000

548

1,151

(1,184)

515

Total included within staff costs and other financial income 

Of the total charge, £566,000 (2011: £548,000) and £168,000 (2011: £33,000) were included in “administrative expenses” and “net finance 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
30 Pension scheme continued 
The amounts recognised in the balance sheet are determined as follows: 

Present value of funded obligations 
Fair value of plan assets 
Surplus in the scheme 
Less restriction of surplus recognised in the balance sheet 
Liability recognised in the balance sheet 

The movement in the defined benefit obligation over the year is as follows: 

At 1 July  
Current service cost 
Interest cost 
Contributions by plan participants 
Actuarial losses 
Benefits paid 
At 30 June  

The figures at 1 July 2009 have been updated as at the balance sheet dates in order to assess the additional disclosures required under  

IAS 19 as at 30 June 2012 by an independent qualified actuary using the following major assumptions. 

The movement in the fair value of the plan assets of the year is as follows: 

At 1 July  
Expected return in plan assets 
Actuarial gains/(losses) 
Employer contributions 
Employee contributions 
Benefits paid 
At 30 June  

The amounts recognised in the income statement are as follows: 

Current service cost 
Interest cost 
Expected return on plan assets 
Total included within staff costs and other financial income 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

61

2012
£’000

2011
£’000

(23,809)
23,824
15
(15)
–

(22,993)
23,476
483
(483)
–

2012
£’000

2011
£’000

(22,993)
(566)
(1,220)
(350)
(1,603)
2,923
(23,809)

(21,472)
(548)
(1,151)
(349)
(281)
808
(22,993)

2012
£’000

23,476
1,388
193
1,340
350
(2,923)
23,824

2012
£’000

566
1,220
(1,388)
398

2011
£’000

20,093
1,184
1,335
1,323
349
(808)
23,476

2011
£’000

548
1,151
(1,184)
515

Of the total charge, £566,000 (2011: £548,000) and £168,000 (2011: £33,000) were included in “administrative expenses” and “net finance 
income” respectively. 

ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

30 Pension scheme continued 

The contributions of the pure defined contribution, the defined benefit underpin and pure defined benefit elements are paid into one 

pension scheme, where the contributions and assets are segregated and ring-fenced from each other. 

For the defined benefit underpin element of the scheme, each member is tested to see whether the pension on a defined contribution 

or defined benefit basis is higher. The liabilities shown in the pensions note are based on the greater of the two liabilities for each member, 

which in almost all cases is the defined benefit liability. For the service cost, again, tests are performed to see which is the higher for each 

member out of the company’s share of the defined contribution payments or the company’s share of accruing benefits on a defined 

benefit basis. The higher of these two figures for each member is then used to give the total service cost; again the defined benefit cost 

is the higher for the vast majority of members. 

The assets of the scheme are held separately from the assets of the group, being invested in Managed Funds. Contributions by the group 

to the scheme during the year ended 30 June 2012 amounted to £1,340,000 (2011: £1,381,000). Contributions are determined by an 

independent qualified actuary on the basis of triennial valuations using the Project Unit Method. 

The date of the most recent actuarial valuation was 1 July 2012, and is in progress. The previous valuation was carried out on 1 July 2009 

and at that date the value of the fund was £17,169,000. This was sufficient to cover 83% of the value of the benefits accrued to members 

after allowing for future increases in earnings. In arriving at the actuarial valuation, the following assumptions were adopted. 

Price inflation 

Salary increases 

Discount rate 

Revaluation for deferred pensioners 

Pension increases in payment of 5% pa or RPI if less 

Pension increases in payment of 2.5% pa or RPI if less 

3.75% 

5.66% 

5.50% 

3.75% 

3.60% 

2.35% 

Price inflation 

Salary increases 

Discount rate 

Revaluation for deferred pensioners 

Pension increases in payment of 5% pa or RPI if less 

Pension increases in payment of 2.5% pa or RPI if less 

Life expectancy at age 65 – men 

Life expectancy at age 65 in 20 years – men 

Life expectancy at age 65 – women 

Life expectancy at age 65 in 20 years – women  

The balance sheet figures required under IAS 19 are as follows: 

2012

2.80%

4.55%

4.40%

2.05%

2.75%

2.10%

2011

3.70%

5.45%

5.50%

2.95%

3.55%

2.35%

2010 

3.50% 

5.25% 

5.35% 

3.50% 

3.30% 

2.20% 

2009 

3.75% 

5.66% 

6.00% 

3.75% 

3.60% 

2.35% 

2008

4.00%

5.89%

6.40%

4.00%

3.80%

2.40%

22.5 years

24.4 years

24.9 years

26.8 years

22.4 years

24.4 years

24.8 years

26.7 years

22.3 years 

24.3 years 

24.7 years 

26.6 years 

22.2 years 

22.0 years

24.6 years 

24.9 years

30 June 2012 

30 June 2011 

30 June 2010 

30 June 2009 

30 June 2008 

Expected  

long-term  

rate of  

return 

Expected 

long-term 

rate of 

return

Value

£’000

Expected 

long-term 

rate of 

return

Value

£’000

6.20% 

9,744

7.75% 11,166

4.40%  12,484

5.00% 10,982

– 

–

–

0.50% 

1,596

0.50%

7.65%

4.84%

7.35%

0.50%

–

1,328

23,476

(22,993)

483

Expected  

long-term  

rate of  

return 

7.80% 

5.30% 

7.80% 

0.50% 

Expected 

long-term 

rate of 

return

7.75%

5.60%

7.75%

5.00%

Value 

£’000 

7,265 

8,066 

12 

1,832 

17,175 

(19,208) 

(2,033) 

Value

£’000

8,573

7,002

11

1,755

17,341

(17,622)

(281)

Value

£’000

9,045

9,464

19

1,565

20,093

(21,472)

(1,379)

Equities 

Bonds 

Property 

Other 

Total market value of assets 

Present value of scheme liabilities 

Surplus/(deficit) in the scheme 

  23,824

  (23,809)

15

The property assets have been amalgamated with equities for reporting purposes during the year ended 2011 due to their low value. 

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62

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ACCOUNTS 

30 Pension scheme continued 
Analysis of amount recognised in the statement of comprehensive income 

Actual return less expected return on pension scheme assets 
Experience gains/(losses) arising on the scheme liabilities 
Changes in assumptions underlying the present value on the scheme liabilities 
Restriction of pension scheme surplus 
Actuarial (loss)/gain recognised in the statement of comprehensive income 

Cumulative actuarial loss recognised in the statement of comprehensive income at 1 July  
Actuarial loss recognised in the statement of comprehensive income for the year 
Cumulative actuarial loss recognised in the statement of comprehensive income at 30 June  

2012
£’000

193
227
(1,830)
468
(942)

2012
£’000

(2,864)
(1,410)
(4,274)

2011
£’000

1,335
(433)
152
(483)
571

2011
£’000

(3,918)
1,054
(2,864)

The restriction in the scheme surplus is excluded from the cumulative actuarial loss recognised in the statement of comprehensive 
income. 

The expected return on plan assets is determined by considering the expected returns available on the assets underlying the current 
investment policy. Expected yields on fixed interest investments are based on gross redemption yields as at the balance sheet date. 
Expected returns on equity and property investments reflect long-term real rates of return experienced in the respective markets. 

The actual return on plan assets over the period ending 30 June 2012 was £1,551,000 or 6.5%. 

The group expect to pay £1,363,000 contributions (2011: £1,229,000) into the pension scheme during the forthcoming year. 

History of experience gains and losses recognised in the statement of comprehensive income 

2012 

£’000 

2011 

2010 

2009 

2008 

% 

£’000

%

£’000

%

£’000 

% 

£’000

%

1,335

1,713

(1,969) 

(2,038)

11% 

12%

(492) 

(219)

Difference between the 
expected and actual return  
on scheme assets 
Percentage of scheme assets 
Experience loss on  
scheme liabilities 
Percentage of the present 
value of scheme liabilities 
Changes in assumptions 
underlying the present value 
of scheme liabilities 
Percentage of the present 
value of scheme liabilities 
Restriction of pension 
scheme surplus 
Percentage of the present 
value of scheme liabilities 
Amount which has been 
recognised in the SoCI 
Percentage of the present 
value of the scheme 
liabilities 

193 

227 

1% 

1% 

(433)

6%

2%

(388)

(1,830) 

152 

(1,371)

– 

8% 

0% 

(483)

(1,410) 

571

6% 

0%

2%

2%

–

9%

2%

6%

–

344 

– 

3% 

2% 

– 

633

–

1%

4%

–

9%

(46)

(2,117) 

(1,624)

0%

11% 

31 Group companies 

The parent company has the following investments as at 30 June 2012 and 30 June 2011: 

Name of undertaking 

Mackwell Electronics Limited 

Compact Lighting Limited 

Philip Payne Limited 

Sugg Lighting Limited 

Solite Europe Limited 

Portland Lighting Limited 

TRT Lighting Limited 

Country of 

incorporation 

England 

England 

England 

England 

England 

England 

England 

Description of shares held

Ordinary £1 shares

Ordinary £1 shares

Ordinary £1 shares

Ordinary £1 shares

Ordinary £1 shares

Ordinary £1 shares

Ordinary £1 shares

Proportion of nominal value 

of issued shares held by

 group and company

100%

100%

100%

100%

The principal activities of these subsidiaries are: 

Compact Lighting Limited 

  – design and manufacture of lighting solutions for retail applications  

Philip Payne Limited 

Sugg Lighting Limited 

Solite Europe Limited 

  – design and manufacture of illuminated signs  

  – design and manufacture of traditional architectural lighting  

  – design and manufacture of cleanroom lighting equipment  

Portland Lighting Limited 

  – design and manufacture of lighting for signs 

TRT Lighting Limited 

  – non-trading 

The cost of investment in subsidiaries is as follows: 

100% Disposed on 2 December 2011 

100% Acquired on 1 July 2011 

100% Non trading 

Investment in subsidiaries – cost 

Less provisions 

The movement in the investment and provisions is as follows: 

At 1 July 2010 and 1 July 2011 

Acquisition of Portland Lighting Ltd 

Disposal of Mackwell Electronics Ltd 

At 30 June 2012 

Group 

2012

£’000

Company 

2011 

£’000 

2012

£’000

–

–

–

– 

– 

– 

5,732

(1,564)

4,168

2011

£’000

2,572

(1,564)

1,008

Cost 

£’000

Provisions

£’000

2,572

3,488

(328)

5,732

(1,564)

–

–

(1,564)

TRT Lighting Ltd was established during the year by FW Thorpe Plc. It has an authorised and issued share capital of £100. 

There were no other additions or disposals during the year. 

015702_FW_Thorpe_18-68.indd   62

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ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

2012

£’000

193

227

(1,830)

468

(942)

2012

£’000

(2,864)

(1,410)

(4,274)

2011

£’000

1,335

(433)

152

(483)

571

2011

£’000

(3,918)

1,054

(2,864)

Actual return less expected return on pension scheme assets 

Experience gains/(losses) arising on the scheme liabilities 

Changes in assumptions underlying the present value on the scheme liabilities 

Restriction of pension scheme surplus 

Actuarial (loss)/gain recognised in the statement of comprehensive income 

Cumulative actuarial loss recognised in the statement of comprehensive income at 1 July  

Actuarial loss recognised in the statement of comprehensive income for the year 

Cumulative actuarial loss recognised in the statement of comprehensive income at 30 June  

The restriction in the scheme surplus is excluded from the cumulative actuarial loss recognised in the statement of comprehensive 

income. 

The expected return on plan assets is determined by considering the expected returns available on the assets underlying the current 

investment policy. Expected yields on fixed interest investments are based on gross redemption yields as at the balance sheet date. 

Expected returns on equity and property investments reflect long-term real rates of return experienced in the respective markets. 

The actual return on plan assets over the period ending 30 June 2012 was £1,551,000 or 6.5%. 

The group expect to pay £1,363,000 contributions (2011: £1,229,000) into the pension scheme during the forthcoming year. 

History of experience gains and losses recognised in the statement of comprehensive income 

2012 

£’000 

2011 

2010 

2009 

2008 

% 

£’000

%

£’000

%

£’000 

% 

£’000

%

of scheme liabilities 

(1,830) 

152 

(1,371)

344 

Difference between the 

expected and actual return  

on scheme assets 

Percentage of scheme assets 

Experience loss on  

scheme liabilities 

Percentage of the present 

value of scheme liabilities 

Changes in assumptions 

underlying the present value 

Percentage of the present 

value of scheme liabilities 

Restriction of pension 

scheme surplus 

Percentage of the present 

value of scheme liabilities 

Amount which has been 

recognised in the SoCI 

Percentage of the present 

value of the scheme 

liabilities 

193 

227 

1,335

1,713

(1,969) 

(2,038)

11% 

12%

(433)

(388)

(492) 

(219)

1% 

1% 

8% 

0% 

6% 

6%

2%

0%

2%

2%

9%

2%

6%

–

0%

633

–

3% 

2% 

– 

11% 

1%

4%

–

9%

– 

(483)

–

– 

(1,410) 

571

(46)

(2,117) 

(1,624)

30 Pension scheme continued 

Analysis of amount recognised in the statement of comprehensive income 

31 Group companies 
The parent company has the following investments as at 30 June 2012 and 30 June 2011: 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

63

Name of undertaking 

Mackwell Electronics Limited 
Compact Lighting Limited 
Philip Payne Limited 
Sugg Lighting Limited 
Solite Europe Limited 
Portland Lighting Limited 
TRT Lighting Limited 

Country of 
incorporation 

England 
England 
England 
England 
England 
England 
England 

Description of shares held

Ordinary £1 shares
Ordinary £1 shares
Ordinary £1 shares
Ordinary £1 shares
Ordinary £1 shares
Ordinary £1 shares
Ordinary £1 shares

Proportion of nominal value 
of issued shares held by
 group and company

100% Disposed on 2 December 2011 
100%
100%
100%
100%
100% Acquired on 1 July 2011 
100% Non trading 

The principal activities of these subsidiaries are: 

Compact Lighting Limited 
Philip Payne Limited 
Sugg Lighting Limited 
Solite Europe Limited 
Portland Lighting Limited 
TRT Lighting Limited 

  – design and manufacture of lighting solutions for retail applications  
  – design and manufacture of illuminated signs  
  – design and manufacture of traditional architectural lighting  
  – design and manufacture of cleanroom lighting equipment  
  – design and manufacture of lighting for signs 
  – non-trading 

The cost of investment in subsidiaries is as follows: 

Investment in subsidiaries – cost 
Less provisions 

The movement in the investment and provisions is as follows: 

At 1 July 2010 and 1 July 2011 
Acquisition of Portland Lighting Ltd 
Disposal of Mackwell Electronics Ltd 
At 30 June 2012 

Group 

2012
£’000

–
–
–

2011 
£’000 

– 
– 
– 

Company 
2012
£’000

5,732
(1,564)
4,168

2011
£’000

2,572
(1,564)
1,008

Cost 
£’000

Provisions
£’000

2,572
3,488
(328)
5,732

(1,564)
–
–
(1,564)

TRT Lighting Ltd was established during the year by FW Thorpe Plc. It has an authorised and issued share capital of £100. 

There were no other additions or disposals during the year. 

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64

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ACCOUNTS 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ADDITIONAL INFORMATION 

NOTICE OF MEETING 

32 Investment in joint venture 
The group has a joint venture in Australia with its local agent. The venture is jointly controlled with equal voting rights with the group 
holding a 51% interest. Thorlux Lighting Pty Ltd is registered in Queensland and operates from a sales office in Melbourne. The group has 
applied the equity method of accounting to recognise this interest. 

Notice is hereby given that the seventy-sixth Annual General 

Meeting of FW Thorpe Plc will be held at Merse Road, North Moons 

Moat, Redditch, Worcestershire B98 9HH on 15 November 2012 at 

3.15 pm to transact the following business: 

At 1 July  
Share of loss 
Exchange rate movement 
At 30 June  

Group 
2012
£’000

136
(23)
(2)
111

2011 
£’000 

156 
(11) 
(9) 
136 

Company 
2012 
£’000 

156 
– 
– 
156 

2011
£’000

156
–
–
156

33 Events after the balance sheet date 
Taxation 
A reduction in the main rate of corporation tax from 27% to 25% from 1 April 2012 was announced in the Budget on 23 March 2011 and 
substantively enacted on 5 July 2011. In addition to the change in corporation tax rate disclosed above, a number of further changes to 
the UK corporation tax system were announced in the March 2012 UK Budget Statement. A resolution passed by Parliament on 26 March 
2012 reduced the main rate of corporation tax from 26% to 24% from 1 April 2012. Legislation to reduce the main rate of corporation 
tax from 24% to 23% from 1 April 2013 is included in the Finance Act 2012 which was substantially enacted on 3 July 2012. A further 
reduction in the main rate is also proposed to reduce the rate to 22% from 1 April 2014. None of these rate reductions had been 
substantively enacted at the balance sheet date and therefore they are not included in these financial statements. 

The effect of the changes in corporation tax rates enacted by Parliament on 26 March 2012 and the further changes substantively enacted 
on 3 July 2012 are not material to the financial statements and have not therefore been calculated. 

9.  That, subject to the passing of resolution number 8, the 

directors be and hereby are given the general power to allot 

equity securities (as defined by section 560 of the Act) for cash, 

either pursuant to the authority conferred by resolution 

number 8 or by way of a sale of treasury shares, as if section 

561(1) of the Act did not apply to any such allotment, provided 

that this power shall be limited to the allotment of equity 

securities; 

9.1  in connection with an offer by way of a rights issue: 

(a)  to the holders of ordinary shares in proportion (as nearly as may 

be practicable) to their respective holdings; and 

(b)  to holders of other equity securities as required by the rights 

attaching to those securities or as the directors otherwise 

consider necessary 

but subject to such 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 stock exchange; and 

9.2  the allotment (otherwise than pursuant to paragraph 9.1) of 

equity securities up to an aggregate nominal amount of 

£58,618 representing no more than 5% of the issued ordinary 

share capital at 12 October 2012. 

The power granted by this resolution will (unless renewed, varied 

or revoked by the company prior to or on such date) expire on the 

earlier of the conclusion of the company’s next Annual General 

Meeting and the expiry of the period of 15 months following the 

passing of this resolution, save that the company may, before such 

expiry, make offers or agreements which would or might require 

equity securities to be allotted after such expiry and the directors 

may allot equity securities in pursuance of any such offer or 

agreement notwithstanding that the power conferred by this 

resolution has expired. 

This resolution revokes and replaces all unexercised powers 

previously granted to the directors to allot equity securities as if 

section 561(1) of the 2006 Act did not apply but without prejudice 

to any allotment of equity securities already made or agreed to be 

made pursuant to such powers. 

1.  To receive and adopt the directors’ Report and Accounts for the 

Ordinary business 

year ended 30 June 2012. 

2.  To declare a dividend. 

3.  To re-elect Mr A B Thorpe as a director. 

4.  To re-elect Mr M Allcock as a director. 

5.  To re-elect Mr C M Brangwin as a director. 

6.  To re-appoint PricewaterhouseCoopers LLP as auditors of the 

company, to hold office until the conclusion of the next General 

Meeting at which accounts are laid before the company and 

to authorise the directors to fix the auditors’ remuneration. 

Special business 

To consider and, if thought fit, to pass the following resolutions 

which will be proposed in the case of 7 and 8 as ordinary 

resolutions and in the case of 9 and 10 as special resolutions. 

7.  That the directors’ remuneration report (as set out on pages 

22 to 24 of the Annual Report and Accounts) for the year ended 

30 June 2012 be approved. 

8.  That the directors be and hereby are generally and 

unconditionally authorised to allot shares in the company 

or to grant rights to subscribe for, or to convert any security 

into, shares in the company (“Rights”) comprising equity 

securities (as defined by section 560 of the Companies Act 2006 

(“the Act”)) up to an aggregate nominal amount of £310,644.  

Provided that this authority shall, unless renewed, varied or revoked 

by the company, expire on the date of the next Annual General 

Meeting of the company, save that the company may, before 

such expiry, make offers or agreements which would or might 

require shares to be allotted or Rights to be granted and the 

directors may allot shares or grant Rights in pursuance of such 

offer or agreement notwithstanding that the authority conferred 

by this resolution has expired. 

This resolution revokes and replaces all unexercised authorities 

previously granted to the directors to allot shares or to grant 

Rights but without prejudice to any allotment of shares or grant 

of Rights already made, offered or agreed to be made pursuant 

to such authorities. 

015702_FW_Thorpe_18-68.indd   64

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ACCOUNTS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 

ADDITIONAL INFORMATION 
NOTICE OF MEETING 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

65

32 Investment in joint venture 

The group has a joint venture in Australia with its local agent. The venture is jointly controlled with equal voting rights with the group 

holding a 51% interest. Thorlux Lighting Pty Ltd is registered in Queensland and operates from a sales office in Melbourne. The group has 

applied the equity method of accounting to recognise this interest. 

Group 

2012

£’000

136

(23)

(2)

111

2011 

£’000 

156 

(11) 

(9) 

136 

Company 

2012 

£’000 

156 

– 

– 

156 

2011

£’000

156

–

–

156

At 1 July  

Share of loss 

At 30 June  

Exchange rate movement 

33 Events after the balance sheet date 

Taxation 

A reduction in the main rate of corporation tax from 27% to 25% from 1 April 2012 was announced in the Budget on 23 March 2011 and 

substantively enacted on 5 July 2011. In addition to the change in corporation tax rate disclosed above, a number of further changes to 

the UK corporation tax system were announced in the March 2012 UK Budget Statement. A resolution passed by Parliament on 26 March 

2012 reduced the main rate of corporation tax from 26% to 24% from 1 April 2012. Legislation to reduce the main rate of corporation 

tax from 24% to 23% from 1 April 2013 is included in the Finance Act 2012 which was substantially enacted on 3 July 2012. A further 

reduction in the main rate is also proposed to reduce the rate to 22% from 1 April 2014. None of these rate reductions had been 

substantively enacted at the balance sheet date and therefore they are not included in these financial statements. 

The effect of the changes in corporation tax rates enacted by Parliament on 26 March 2012 and the further changes substantively enacted 

on 3 July 2012 are not material to the financial statements and have not therefore been calculated. 

Notice is hereby given that the seventy-sixth Annual General 
Meeting of FW Thorpe Plc will be held at Merse Road, North Moons 
Moat, Redditch, Worcestershire B98 9HH on 15 November 2012 at 
3.15 pm to transact the following business: 

Ordinary business 
1.  To receive and adopt the directors’ Report and Accounts for the 

year ended 30 June 2012. 

2.  To declare a dividend. 

3.  To re-elect Mr A B Thorpe as a director. 

4.  To re-elect Mr M Allcock as a director. 

5.  To re-elect Mr C M Brangwin as a director. 

6.  To re-appoint PricewaterhouseCoopers LLP as auditors of the 

company, to hold office until the conclusion of the next General 
Meeting at which accounts are laid before the company and 
to authorise the directors to fix the auditors’ remuneration. 

Special business 
To consider and, if thought fit, to pass the following resolutions 
which will be proposed in the case of 7 and 8 as ordinary 
resolutions and in the case of 9 and 10 as special resolutions. 

7.  That the directors’ remuneration report (as set out on pages 

22 to 24 of the Annual Report and Accounts) for the year ended 
30 June 2012 be approved. 

8.  That the directors be and hereby are generally and 

unconditionally authorised to allot shares in the company 
or to grant rights to subscribe for, or to convert any security 
into, shares in the company (“Rights”) comprising equity 
securities (as defined by section 560 of the Companies Act 2006 
(“the Act”)) up to an aggregate nominal amount of £310,644.  

Provided that this authority shall, unless renewed, varied or revoked 
by the company, expire on the date of the next Annual General 
Meeting of the company, save that the company may, before 
such expiry, make offers or agreements which would or might 
require shares to be allotted or Rights to be granted and the 
directors may allot shares or grant Rights in pursuance of such 
offer or agreement notwithstanding that the authority conferred 
by this resolution has expired. 

This resolution revokes and replaces all unexercised authorities 
previously granted to the directors to allot shares or to grant 
Rights but without prejudice to any allotment of shares or grant 
of Rights already made, offered or agreed to be made pursuant 
to such authorities. 

9.  That, subject to the passing of resolution number 8, the 

directors be and hereby are given the general power to allot 
equity securities (as defined by section 560 of the Act) for cash, 
either pursuant to the authority conferred by resolution 
number 8 or by way of a sale of treasury shares, as if section 
561(1) of the Act did not apply to any such allotment, provided 
that this power shall be limited to the allotment of equity 
securities; 

9.1  in connection with an offer by way of a rights issue: 

(a)  to the holders of ordinary shares in proportion (as nearly as may 

be practicable) to their respective holdings; and 

(b)  to holders of other equity securities as required by the rights 
attaching to those securities or as the directors otherwise 
consider necessary 

but subject to such 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 stock exchange; and 

9.2  the allotment (otherwise than pursuant to paragraph 9.1) of 
equity securities up to an aggregate nominal amount of 
£58,618 representing no more than 5% of the issued ordinary 
share capital at 12 October 2012. 

The power granted by this resolution will (unless renewed, varied 
or revoked by the company prior to or on such date) expire on the 
earlier of the conclusion of the company’s next Annual General 
Meeting and the expiry of the period of 15 months following the 
passing of this resolution, save that the company may, before such 
expiry, make offers or agreements which would or might require 
equity securities to be allotted after such expiry and the directors 
may allot equity securities in pursuance of any such offer or 
agreement notwithstanding that the power conferred by this 
resolution has expired. 

This resolution revokes and replaces all unexercised powers 
previously granted to the directors to allot equity securities as if 
section 561(1) of the 2006 Act did not apply but without prejudice 
to any allotment of equity securities already made or agreed to be 
made pursuant to such powers. 

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ADDITIONAL INFORMATION 

SHAREHOLDER NOTES 

6. As at 12 October 2012 (being the last practicable day prior to the publication of this 
notice), the company’s issued share capital consists of ordinary shares of 10p each, 
carrying one vote each. Excluding 170,000 shares held in treasury, the total voting rights 
in the company as at 12 October 2012 are 11,723,559. 

7. Appointment of a proxy will not preclude a member from subsequently attending 
and voting at the meeting should he or she subsequently decide to do so. You can only 
appoint a proxy using the procedures set out in these notes and the notes to the form 
of proxy. 

By order of the Board 

C Muncaster 
Company Secretary 
Merse Road 
North Moons Moat 
Redditch 
Worcestershire 
B98 9HH 

12 October 2012 

66

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ADDITIONAL INFORMATION 
NOTICE OF MEETING CONTINUED 

10.  That the company be generally and unconditionally authorised 
to make market purchases (within the meaning of section 
693(4) of the Companies Act 2006) of ordinary shares of 10p 
each of the company provided that: 

(a)  the maximum number of ordinary shares hereby authorised 

to be acquired is 1,189,356; 

(b)  the minimum price which may be paid for any such share 

is 10p; 

(c)  the maximum price which may be paid for any such share is 

an amount equal to 105% of the average of the middle market 
quotations for an ordinary share in the company as derived 
from the Alternative Investment Market for the five business 
days immediately preceding the day on which such share is 
contracted to be purchased; 

(d)  the authority hereby conferred shall expire on the date of the 

Annual General Meeting of the company in 2013; and 

(e)  the company may make a contract to purchase its ordinary 

shares under the authority hereby conferred prior to the expiry 
of such authority, which contract will or may be executed 
wholly or partly after the expiry of such authority, and may 
purchase its ordinary shares in pursuance of any such contract. 

Notes 

1. Copies of the directors’ service contracts will be available for inspection during usual 
business hours, at the registered office of the company on any weekday (Saturdays 
and public holidays excepted) from the date of this notice until the date of the meeting 
and also at the meeting for at least 15 minutes prior to, and until the conclusion of, 
the meeting. 

2. To be entitled to attend and vote at the meeting (and for the purposes of the 
determination by the company of the votes they may cast), members must be registered 
in the Register of Members of the company at 6.00 pm on 13 November 2012 (or, in the 
event of any adjournment, 6.00 pm on the date which is two days before the time of 
the adjourned meeting). Changes to the Register of Members of the company after the 
relevant deadline shall be disregarded in determining the rights of any person to attend 
and vote at the meeting. 

3. A member entitled to attend and vote at the meeting is entitled to appoint a proxy 
or proxies to attend, speak and vote on his or her behalf. A proxy need not also be a 
member but must attend the meeting to represent you. Details of how to appoint the 
chairman of the meeting or another person as your proxy using the form of proxy are set 
out in the notes on the form of proxy. If you wish your proxy to speak on your behalf at 
the meeting you will need to appoint your own choice of proxy (not the chairman) and 
give your instructions directly to them. 

4. To appoint more than one proxy, an additional proxy form(s) may be obtained by 
contacting the company’s registrars, Equiniti, Aspect House, Spencer Road, Lancing, 
West Sussex BN99 6DA, or you may photocopy the proxy form. Please indicate in the 
box next to the proxy holder’s name the number of shares in relation to which they 
are authorised to act as your proxy. Please also indicate by ticking the box provided 
if the proxy instruction is one of multiple instructions being given. 

5. A reply paid form of proxy is enclosed with shareholders’ copies of this document. 
To be valid, it should be lodged with the company’s registrars, Equiniti, Aspect House, 
Spencer Road, Lancing, West Sussex BN99 6DA, so as to be received not later than 
3.15 pm on 13 November 2012 or 48 hours before the time appointed for any adjourned 
meeting or, in the case of a poll taken subsequent to the date of the meeting or 
adjourned meeting, so as to be received no later than 24 hours before the time 
appointed for taking the poll. 

015702_FW_Thorpe_18-68.indd   66

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ADDITIONAL INFORMATION 

NOTICE OF MEETING CONTINUED 

ADDITIONAL INFORMATION 
SHAREHOLDER NOTES 

FW Thorpe Plc
Annual	Report	and	Accounts	2012

67

10.  That the company be generally and unconditionally authorised 

to make market purchases (within the meaning of section 

693(4) of the Companies Act 2006) of ordinary shares of 10p 

6. As at 12 October 2012 (being the last practicable day prior to the publication of this 

notice), the company’s issued share capital consists of ordinary shares of 10p each, 

carrying one vote each. Excluding 170,000 shares held in treasury, the total voting rights 

in the company as at 12 October 2012 are 11,723,559. 

each of the company provided that: 

7. Appointment of a proxy will not preclude a member from subsequently attending 

and voting at the meeting should he or she subsequently decide to do so. You can only 

appoint a proxy using the procedures set out in these notes and the notes to the form 

(a)  the maximum number of ordinary shares hereby authorised 

to be acquired is 1,189,356; 

(b)  the minimum price which may be paid for any such share 

of proxy. 

is 10p; 

By order of the Board 

C Muncaster 

Company Secretary 

Merse Road 

North Moons Moat 

Redditch 

Worcestershire 

B98 9HH 

12 October 2012 

(c)  the maximum price which may be paid for any such share is 

an amount equal to 105% of the average of the middle market 

quotations for an ordinary share in the company as derived 

from the Alternative Investment Market for the five business 

days immediately preceding the day on which such share is 

contracted to be purchased; 

(d)  the authority hereby conferred shall expire on the date of the 

Annual General Meeting of the company in 2013; and 

(e)  the company may make a contract to purchase its ordinary 

shares under the authority hereby conferred prior to the expiry 

of such authority, which contract will or may be executed 

wholly or partly after the expiry of such authority, and may 

purchase its ordinary shares in pursuance of any such contract. 

Notes 

the meeting. 

1. Copies of the directors’ service contracts will be available for inspection during usual 

business hours, at the registered office of the company on any weekday (Saturdays 

and public holidays excepted) from the date of this notice until the date of the meeting 

and also at the meeting for at least 15 minutes prior to, and until the conclusion of, 

2. To be entitled to attend and vote at the meeting (and for the purposes of the 

determination by the company of the votes they may cast), members must be registered 

in the Register of Members of the company at 6.00 pm on 13 November 2012 (or, in the 

event of any adjournment, 6.00 pm on the date which is two days before the time of 

the adjourned meeting). Changes to the Register of Members of the company after the 

relevant deadline shall be disregarded in determining the rights of any person to attend 

and vote at the meeting. 

3. A member entitled to attend and vote at the meeting is entitled to appoint a proxy 

or proxies to attend, speak and vote on his or her behalf. A proxy need not also be a 

member but must attend the meeting to represent you. Details of how to appoint the 

chairman of the meeting or another person as your proxy using the form of proxy are set 

out in the notes on the form of proxy. If you wish your proxy to speak on your behalf at 

the meeting you will need to appoint your own choice of proxy (not the chairman) and 

give your instructions directly to them. 

4. To appoint more than one proxy, an additional proxy form(s) may be obtained by 

contacting the company’s registrars, Equiniti, Aspect House, Spencer Road, Lancing, 

West Sussex BN99 6DA, or you may photocopy the proxy form. Please indicate in the 

box next to the proxy holder’s name the number of shares in relation to which they 

are authorised to act as your proxy. Please also indicate by ticking the box provided 

if the proxy instruction is one of multiple instructions being given. 

5. A reply paid form of proxy is enclosed with shareholders’ copies of this document. 

To be valid, it should be lodged with the company’s registrars, Equiniti, Aspect House, 

Spencer Road, Lancing, West Sussex BN99 6DA, so as to be received not later than 

3.15 pm on 13 November 2012 or 48 hours before the time appointed for any adjourned 

meeting or, in the case of a poll taken subsequent to the date of the meeting or 

adjourned meeting, so as to be received no later than 24 hours before the time 

appointed for taking the poll. 

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68

FW Thorpe Plc	
Annual	Report	and	Accounts	2012

ADDITIONAL INFORMATION 
SHAREHOLDER NOTES CONTINUED 

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Financial calendar

2012

19 October

Posting of the Annual Report and Accounts

15 November

Annual General Meeting

22 November

Payment of final dividend

2013

March

May

Announcement of interim results

Payment of interim dividend

September

Announcement of results for the year

Designed and produced by Radley Yeldar www.ry.com using the paperless proofing system Wizardry. 

This material used in the publication of this document is carbon balanced.

Printed on FSC certified paper.

This document is printed on material manufactured at a mill which is ISO14001 accredited

FW Thorpe Plc

Merse Road 
North Moons Moat 
Redditch 
Worcestershire 
B98 9HH 
England

Tel: +44 (0)1527 583200 
Fax: +44 (0)1527 584177

Incorporating 
Thorlux Lighting 
Compact Lighting 
Philip Payne 
Sugg Lighting 
Solite Europe 
Portland Lighting 
TRT Lighting

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www.fwthorpe.co.uk

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Annual Report and Accounts 2012

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