4
D(cid:1)I(cid:1)R(cid:1)E(cid:1)C(cid:1)T(cid:1)O(cid:1)R(cid:1)S(cid:1) R(cid:1)E(cid:1)P(cid:1)O(cid:1)R T(cid:1) A(cid:1)N(cid:1)D(cid:1) A(cid:1)C(cid:1)C(cid:1)O(cid:1)U(cid:1)N(cid:1)T(cid:1)S(cid:1)
3 Oth(cid:1) A(cid:1)P(cid:1)R(cid:1)I(cid:1)L(cid:1) (cid:19)(cid:1)(cid:17)(cid:1)(cid:19)(cid:1)(cid:18)
INDEX
Notice of Annual General Meeting
Notes to Notice of Annual General Meeting
GROUP STRATEGIC REPORT
Chairman’s Statement
Summary of Consolidated Statement of Profit or Loss
Objectives, Strategy and Business Model
Principal Risks and Uncertainties
Corporate Social Responsibility
DIRECTORS’ REPORTS
Report of the Directors
Corporate Governance Report
Audit Committee Report
Directors’ Remuneration Policy and Report
Statement of Directors’ responsibilities in respect of the
Annual Report and the Financial Statements
AUDITOR’S REPORT
Independent Auditor’s Report to the Members of Goodwin PLC
FINANCIAL STATEMENTS
Consolidated Statement of Profit or Loss
Consolidated Statement of Comprehensive Income
Consolidated Statement of Changes in Equity
Consolidated Balance Sheet
Consolidated Statement of Cash Flows
FIVE YEAR FINANCIAL SUMMARY
1
2
3
6
7
12
14
17
20
22
25
32
33
43
44
45
47
48
97
FINANCIAL HIGHLIGHTS
Accounting policies 49
Estimates and judgements 55
Revenue 59
Alternative performance measures 84
Finance costs (net) 61
Right-of-use assets 64
Borrowings 69
Financial risk management 73
Subsequent events 81
Capital and reserves 73
Guarantees and contingencies 81
Segmental information 56
Capital commitments 81
Intangible assets 67
Staff numbers and costs 60
Cash and cash equivalents 69
Investments in subsidiaries 65
Taxation 61
Company statements 85
Inventories 69
Trade assets 69
Deferred tax 72
Property, plant and equipment 63
Trade liabilities 71
Dividend policy 11
Provisions 71
Earnings per share 62
Related parties 82
GOODWIN PLC
www.goodwin.co.uk
Registered in England and Wales, Number 305907
Established 1883
T. J. W. Goodwin
(Chairman)
Directors:
M. S. Goodwin
(Managing Director)
Mechanical
Engineering Division
S. R. Goodwin
(Managing Director)
Refractory
Engineering Division
J. Connolly N. Brown B. R. E. Goodwin J. E. Kelly (Non-Executive Director)
Secretary and registered office:
Mrs. J. L. Martin, L.L.B., A.C.I.S.
Ivy House Foundry, Hanley,
Stoke-on-Trent, ST1 3NR
Registrar and share transfer office:
Computershare Investor Services PLC,
The Pavilions, Bridgwater Road,
Bristol, BS99 6ZZ
Auditor:
RSM UK Audit LLP,
Festival Way, Festival Park, Stoke-on-Trent, ST1 5BB
NOTICE IS HEREBY GIVEN that the EIGHTY-SIXTH ANNUAL GENERAL MEETING of the
Company will be held at 10.30am on Wednesday, 6th October, 2021 at Crewe Hall, Weston
Road, Crewe, Cheshire CW1 6UZ, for the purpose of considering and, if thought fit, passing
the following resolutions which are proposed as ordinary resolutions.
1.
2.
3.
4.
5.
6.
To receive the Directors’ Reports and the audited financial statements for the year
ended 30th April, 2021.
To approve the payment of the proposed ordinary dividend on the ordinary shares.
To re-elect Mr. N. Brown as a Director.
To re-elect Mrs. J. E. Kelly as a Non-Executive Director.
To approve the Directors' Remuneration Report (excluding the Directors’ Remuneration
Policy) for the year ended 30th April, 2021, as stated on pages 27 to 31 of the Directors'
Report.
To re-appoint RSM UK Audit LLP as auditor and to authorise the Directors to
determine their remuneration.
By Order of the Board
Registered Office:
Ivy House Foundry,
Hanley, Stoke-on-Trent
11th August, 2021
J. L. Martin
Secretary
1
NOTES TO NOTICE OF ANNUAL GENERAL MEETING:
1. Members are entitled to appoint a proxy to exercise all or any of their rights to attend and to speak and vote on
their behalf at the meeting. A shareholder may appoint more than one proxy in relation to the Annual General
Meeting provided that each proxy is appointed to exercise the rights attached to a different share or shares held
by that shareholder. A proxy need not be a shareholder of the Company. A proxy form which may be used to
make such appointment and give proxy instructions accompanies this notice.
2. To be valid any proxy form or other instrument appointing a proxy must be received by post, by scanned
copy sent to proxies@goodwingroup.com or (during normal business hours only) by hand at Ivy House Foundry,
Hanley, Stoke-on-Trent, ST1 3NR no later than 10.30am on 4th October, 2021.
3. The return of a completed proxy form or other such instrument will not prevent a shareholder attending the
Annual General Meeting and voting in person if he/she wishes to do so.
4. Any person, to whom this notice is sent, who is a person nominated under section 146 of the Companies Act
2006 to enjoy information rights (a “Nominated Person”) may, under an agreement between him/her and the
shareholder by whom he/she was nominated, have a right to be appointed (or to have someone else appointed)
as a proxy for the Annual General Meeting. If a Nominated Person has no such proxy appointment right or does
not wish to exercise it, he/she may, under any such agreement, have a right to give instructions to the shareholder
as to the exercise of voting rights.
5. The statement of the rights of shareholders in relation to the appointment of proxies in paragraphs 1 and 2 above
does not apply to Nominated Persons. The rights described in these paragraphs can only be exercised by
shareholders of the Company.
6. To be entitled to attend and vote at the Annual General Meeting (and for the purpose of the determination by
the Company of the votes they may cast), shareholders must be registered in the Register of Members of the
Company at 10.30am on 4th October, 2021 (or, in the event of any adjournment, 10.30am on the date which is
two days before the time of the adjourned meeting). Changes to the Register of Members after the relevant
deadline shall be disregarded in determining the rights of any person to attend and vote at the meeting.
7. As at 10th August, 2021 (being the last business day prior to the publication of this Notice) the Company’s issued
share capital consists of 7,689,600 ordinary shares, carrying one vote each. Therefore, the total voting rights in
the Company as at 11th August, 2021 are 7,689,600.
8. Shareholders should note that it is possible that, pursuant to requests made by shareholders of the Company
under section 527 of the Companies Act 2006, the Company may be required to publish on a website a statement
setting out any matter relating to: (i) the audit of the Company’s accounts (including the auditor’s report and the
conduct of the audit) that are to be laid before the Annual General Meeting; or (ii) any circumstance connected
with an auditor of the Company ceasing to hold office since the previous meeting at which annual accounts and
reports were laid in accordance with section 437 of the Companies Act 2006. The Company may not require the
shareholders requesting any such website publication to pay its expenses in complying with sections 527 or 528
of the Companies Act 2006. Where the Company is required to place a statement on a website under section 527
of the Companies Act 2006, it must forward the statement to the Company’s auditor not later than the time when
it makes the statement available on the website. The business which may be dealt with at the Annual General
Meeting includes any statement that the Company has been required under section 527 of the Companies Act
2006 to publish on a website.
9.
In order to facilitate voting by corporate representatives at the meeting, arrangements will be put in place at
the meeting so that (i) if a corporate shareholder has appointed the chairman of the meeting as its corporate
representative with instructions to vote on a poll in accordance with the directions of all of the other corporate
representatives for that shareholder at the meeting, then on a poll those corporate representatives will give
voting directions to the chairman and the chairman will vote (or withhold a vote) as corporate representative in
accordance with those directions; and (ii) if more than one corporate representative for the same corporate
shareholder attends the meeting but the corporate shareholder has not appointed the chairman of the meeting
as its corporate representative, a designated corporate representative will be nominated, from those corporate
representatives who attend, who will vote on a poll and the other corporate representatives will give voting
directions to that designated corporate representative. Corporate shareholders are referred to the guidance issued
by The Chartered Governance Institute on proxies and corporate representatives (www.icsa.org.uk) for further
details of this procedure. The guidance includes a sample form of representation letter if the chairman is being
appointed as described in (i) above.
10. None of the Directors has a service contract with the Company.
11. If approved by shareholders the ordinary dividends will be paid to shareholders on 8th October, 2021.
2
GROUP STRATEGIC REPORT
GOODWIN PLC
CHAIRMAN’S STATEMENT
The pre-tax profit for the Group for the twelve month period ended 30th April, 2021, was
£16.5 million (2020: £12.1 million), an increase of 36% on a revenue of £131 million, (2020:
£145 million). The Directors propose an increased dividend of 102.24p (2020: 81.71p) per share.
In what has been another year of unique challenges, I am delighted that excellent progress
has been made particularly during the second half of the year in many areas with the
Group’s workload as at the time of writing remaining healthy at £165 million (2020:
£183 million).
Despite the placement of large capital projects having slowed as expected due to the
world having to adapt to new working arrangements, headway has been made within the
Mechanical Engineering Division on the nuclear propulsion engineering products and the
nuclear waste containment box supply agreement. The performance achieved in the year is
a reflection of the Group’s strength through diversification, supplying a wide range of
customers, countries and markets. Following the Group’s decisive actions last financial
year with the global onset of Covid-19, the Group protected its workforce and ensured our
manufacturing facilities continued to operate. In doing so, we placed ourselves in a strong
position to tackle the headwinds that were faced during the year ended 30th April, 2021.
Whilst Covid-19 has been the most recent global ‘Black Swan’ event, it is coupled with another
shockwave sweeping the globe, namely the pace of the uptake of greener energy with the
oil majors now rapidly investing in green energy products rather than new oilfields. So when
looking at the Mechanical Engineering Division, our steel foundry, Goodwin Steel Castings
Limited has faced a difficult year due to the accelerated decline of capital flows into oil
projects. Whilst it has progressed well with transitioning its business away from the oil
industry, it has also been hindered by Covid-19 delaying documentation approvals that
would have enabled the foundry to achieve higher levels of casting activity in the year
within its new targeted markets.
Looking forward, Goodwin Steel Castings should soon start to accelerate the production
of 30 tonne cast nuclear waste boxes, the initial castings of which are being successfully
delivered to Goodwin International Limited for machining, painting and assembly. The
foundry is also having good success winning work for naval vessels both in the UK and
the USA, all for long running programmes that will span decades to come in an area
where there are significant time barriers to entry for other foundries.
Profitability in our submersible pump businesses in India, Australia, Africa and Brazil has
materially improved, a reflection of the four companies maturing and the global metal prices
having dramatically recovered. They have all performed admirably by carrying out more
servicing for existing customers on the sizeable global fleet of Goodwin pumps now
deployed. The submersible pump companies in the financial year just completed generated
14% of the Group pre-tax profitability. With minerals pricing across the board generally
being high, our target customers that use our pumps are profitable and are expected to
continue with their delayed capital expenditure in the new financial year.
Goodwin International Limited has had another successful year with a good mix of business,
supplying a growing range of capabilities to their valve, nuclear waste, naval propulsion
and ship construction customers. Within the year a new 1.5 acre facility with multiple 100
tonne overhead cranes and a new radiography bay, has become operational and has started
to fill up with work already on order.
Valve sales to the oil industry in the last financial year represented 43% of activity for Goodwin
International and in this new financial year, whilst Goodwin International’s overall sales
output remains extremely robust as they have orders on hand, the valve activity for the oil
3
GROUP STRATEGIC REPORT
CHAIRMAN’S STATEMENT (continued)
industry is expected to drop to less than 33% of activity as the manufacture relating to
nuclear waste products, propulsion, and naval hull components is rapidly increasing.
Easat Radar Systems’ recovery to profitability has also been impacted due to the severe
decline in global air traffic associated with Covid-19, starving many airports of cash. Whilst
market expectations forecast that air traffic levels are to return to their historic 2019 levels
by 2022 / 2023, infrastructure surveillance projects continue to be planned and Easat has a
growing pipeline of opportunities with the bids being submitted substantially increasing in
size and therefore margin potential.
The Board has high expectations for Easat Radar Systems as it moves away from selling only
the mechanical parts of a radar system. Since the integration with NRPL, based in Finland,
in 2015, followed by a period of design enhancements to their transceivers and interrogators,
we are now marketing and selling complete air traffic control and coastal surveillance
systems inclusive of the air traffic control systems and screens, recorded radios and runway
lighting control to guide planes on the tarmac should the customer so desire. The sales value
of a complete system is in excess of ten times that of the original mechanical components
that were previously manufactured, and now with our vertically integrated product offering
we have a system that not only performs excellently but is internationally competitive. The
major area of growth for Easat over the coming years will be in the Far East, where in
the year, despite the travel restrictions and national lockdown Easat has successfully
commissioned two of the three turnkey radar systems for which it had orders.
Whilst Goodwin Steel Castings and Easat Radar Systems have not recently been firing on
all cylinders, the Board firmly believes that both businesses will become profitable again
moving forward with the transitions they have both been through.
Within the Refractory Engineering Division, increased levels of consumer spending in the
second half of the year on luxury goods, horticulture and construction as a consequence of
Covid-19 restrictions redirecting consumer spending away from entertainment, hospitality
and travel towards these sectors, has resulted in strong performance, making up for the low
activity levels in the first half of the financial year due to the onset of Covid-19. Business
levels remain strong with continued high levels of pent-up consumer spending. The Division
achieved a record pre-tax profit of £9.3 million (2020: £7 million), equating to 46% of the
Group profitability.
Customer acceptance trials of the patented Silica Free Investment Powder, X-Sil, are
underway and it is hoped that regular sales will start within the year ahead, further increasing
the Group’s market share within the industry sector.
Sales of the patented AVD Lith-EX lithium battery fire extinguishers and vermiculite-
containing fluids continue to gain momentum with industry sectors, insurance companies
and accreditation bodies waking up to the need and requirement for products and
standards that specify their use on lithium battery fires which other extinguishing agents
do not effectively extinguish.
Key industry sectors adopting the products include electric car manufacturers, car repair
workshops, battery manufacturers, battery recyclers, energy storage systems, e-mobility
manufacturers, e-mobility storage and repair, marine and military.
Sales of patented Soluform concrete bag work doubled within the year with good
prospects for future growth with the use of the product in large scale projects such as
HS2 and Thames Tideway Tunnel, along with many other projects for the formation of
headwalls, culverts, scour protection, retaining walls and bridge pier protection.
As at 30th April 2021, the Group finished the year with a net debt and gearing of £17.4 million
and 15.4% respectively, as calculated in note 26 (d). The strength of the Group’s cash
4
GROUP STRATEGIC REPORT
CHAIRMAN’S STATEMENT (continued)
generation was a result of staying operational throughout the pandemic, which meant that
the Group has been able to stay within its funding headroom without the need to
approach our financial lenders for additional facilities. Furthermore, the Group has not
needed to cancel any capital expenditure projects; raise additional funds from shareholders;
nor has it any outstanding deferral of tax payments with HMRC. The CCFF loan, that was
drawn down as an insurance policy during the financial year and referred to in the
previous Chairman’s Statement, was fully repaid on 26th April, 2021.
Armed with a strong balance sheet and a renewed set of bank facilities we are well placed
to benefit from the recovery of the global economy and deliver strong returns on the
capital that has been invested to date. The Board remains confident of the Group’s ability
to continue to develop new and existing activities that will deliver additional sustainable
growth in the long term.
The Board is once again indebted to our Directors, managers and employees around the
world for their unwavering efforts in keeping the Group operational, controlling cost and
delivering what can only be described as an extraordinary Group result in the year of
Covid-19 just completed.
11th August, 2021
T. J. W. Goodwin
Chairman
Alternative performance measures mentioned above are defined in note 34 on page 84.
5
GROUP STRATEGIC REPORT
GOODWIN PLC
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
for the year ended 30th April, 2021
Notes
2021
£’000
2020
£’000
CONTINUING OPERATIONS
Revenue … … … … … … … … … …
3, 4
131,231
Cost of sales
… … … … … … … … …
(92,230)
GROSS PROFIT… … … … … … … … … …
Other income
… … … … … … … … …
5
Distribution expenses … … … … … … … …
Administrative expenses
… … … … … … …
39,001
763
(2,988)
(19,682)
144,512
(109,743)
34,769
690
(2,792)
(19,809)
OPERATING PROFIT … … … … … … … … …
17,094
12,858
Finance costs (net)
… … … … … … … …
Share of profit of associate company
… … … … …
PROFIT BEFORE TAXATION
… … … … … … …
Tax on profit
… … … … … … … … …
7
14
5
8
(640)
60
(809)
66
16,514
(3,508)
12,115
(3,775)
PROFIT AFTER TAXATION… … … … … … … …
13,006
8,340
ATTRIBUTABLE TO:
Equity holders of the parent … … … … … … …
Non-controlling interests
… … … … … … …
12,494
512
7,866
474
PROFIT FOR THE YEAR … … … … … … … …
13,006
8,340
BASIC EARNINGS PER ORDINARY SHARE
… … … …
DILUTED EARNINGS PER ORDINARY SHARE … … … …
9
9
167.82p
107.93p
164.23p
103.31p
The full financial statements and accompanying notes are on pages 43 to 96.
6
GROUP STRATEGIC REPORT
OBJECTIVES, STRATEGY AND BUSINESS MODEL
The Group’s main OBJECTIVE is to have a sustainable long-term engineering based business
with good potential for profitable growth while providing a fair return to our shareholders.
The Board’s STRATEGY to achieve this is:
• to supply a range of technically advanced products to growth markets in the mechanical
engineering and refractory engineering segments in which we have built up a global reputation
for engineering excellence, quality, efficiency, reliability, competitive price and delivery;
• to manufacture advanced technical products profitably, efficiently and economically;
• to maintain an ongoing programme of investment in plant, facilities, sales and marketing,
research and development with a view to increasing efficiency, reducing costs, increasing
performance, delivering better products for our customers, expanding our product range and
global customer base and keeping us at the forefront of technology within our markets, whilst
at all times taking appropriate steps to ensure the health and safety of our employees and
customers;
• to control our working capital and investment programme to ensure a safe level of gearing;
• to maintain a strong capital base to retain investor, customer, creditor and market confidence
and so help sustain future development of the business;
• to support a local presence and a local workforce in order to stay close to our customers;
• to invest in training and development of skills for the Group’s future;
• to manage the environmental and social impacts of our business to support long-term
sustainability.
BUSINESS MODEL
The Group’s focus is on manufacturing within two sectors, mechanical engineering and refractory
engineering, and through this division of our manufacturing activities, our overseas business
facilities and our global sales and marketing activities, the Group benefits from market diversity.
Further details of our business and products are shown on our website www.goodwin.co.uk.
Mechanical Engineering
The Group specialises in supplying industrial goods, generally on a project basis, more often than
not involving the complementary skillset of other Group companies to deliver the requirement.
The projects normally involve international procurement, high integrity castings, forgings or
wrought high alloy steels, precision CNC machining, complex welding and fabrication, and other
operations as are required. In addition to specialist projects, the Group manufactures and sells
a wide range of dual plate check valves, axial nozzle check valves and axial piston control and
isolation valves to serve the oil, petrochemical, gas, liquefied natural gas (LNG), mining, nuclear
power generation, nuclear waste treatment and water markets. We generate value by creating
leading edge technology designs, globally sourcing the best quality raw material at good prices,
manufacturing in highly efficient facilities using up to date technology to provide very reliable
products to the required specification, at competitive prices and with timely deliveries.
Our mechanical engineering markets also include high alloy castings, machining and general
engineering products which typically form part of large construction projects such as chemical
plants, oil refineries and naval vessels, nuclear waste treatment plants, high integrity offshore
structural components and bridges. The Group through its foundry, Goodwin Steel Castings
Limited, has the capability to pour high performance alloy castings up to 35 tonnes, radiograph
and also finish, CNC machine and fabricate them at the foundry’s sister company, Goodwin
International Limited. This capability
industry and nuclear
decommissioning, the oil and gas industry, as well as large, global projects requiring high
integrity machined castings.
is targeting the defence
Goodwin International, the largest company in the Mechanical Engineering Division, not only
designs and manufactures dual plate check valves, axial nozzle check valves and axial piston
control and isolation valves but also undertakes specialised CNC machining and fabrication
work for nuclear decommissioning projects. Goodwin International also has a division that is
focused on manufacturing / machining high precision, high integrity components for naval
marine vessels. Noreva GmbH also designs, manufactures and sells axial nozzle check valves.
Both Goodwin International and Noreva purchase the majority of the value of their sand mould
7
GROUP STRATEGIC REPORT
OBJECTIVES, STRATEGY AND BUSINESS MODEL (continued)
castings from Goodwin Steel Castings for their ranges of check valves and this vertical
integration gives rise to competitive benefits, increased efficiencies and timely deliveries.
At Goodwin Pumps India Private Limited we manufacture a superior range of submersible slurry
pumps for end users in India, Brazil, Australia and Africa. Easat Radar Systems Limited and its
subsidiary, NRPL Aero Oy, design and build bespoke high-performance radar antenna systems
for the global market of major defence contractors, civil aviation authorities and border security
agencies. Easat has a sister company, Easat Radar Systems India Private Limited, that also
manufactures, sells and maintains radar systems for air traffic control. We create value on
these by innovative design, assembly and testing in our own facilities using bought in or
engineered in-house components.
Refractory Engineering
Within the Refractory Engineering Division, Goodwin Refractory Services Limited (GRS) primarily
generates value from designing, manufacturing and selling investment casting powders
rubbers and waxes to the jewellery casting industry. GRS also manufactures and sells
investment casting powders to the tyre mould and aerospace industries. The Refractory
Engineering Division has five other investment powder manufacturing companies located in
China, India and Thailand which sell the consumable investment casting products directly and
through distributors to the jewellery casting industry and also directly to tyre mould and
aerospace industries.
These companies are vertically integrated with another of our UK companies, Hoben International
Limited, which manufactures cristobalite, which it sells to the six casting powder manufacturing
companies as well as producing ground silica that also goes into casting powders and other
UK uses of silica such as wind turbine blade manufacture. Hoben International manufactures
different grades of perlite and a patented range of biodegradable bags, known as Soluform,
for the placement of concrete in or around rivers and other construction applications.
The other UK refractory company is Dupré Minerals Limited which focuses on producing exfoliated
vermiculite that is used in insulation, brake linings and fire protection products, including
technical textiles that can withstand exposure to high temperatures and for lithium battery fire
extinguishers. Dupré also sells consumable refractories to the shell moulding precision casting
industry. Dupré has designed, patented and is now selling a range of fire extinguishers and an
extinguishing agent for lithium battery fires that utilises a vermiculite dispersion as the fire
extinguishing agent.
8
OBJECTIVES, STRATEGY AND BUSINESS MODEL (continued)
Divisional Split of Operating Profits (£’000)
BUSINESS DIVERSITY AND PERFORMANCE
GROUP STRATEGIC REPORT
£14,000
£12,000
£10,000
£8,000
£6,000
£4,000
£2,000
£0
2
8
9
,
6
3
3
9
,
5
2
8
2
,
8
0
3
1
,
9
2017
2018
2
3
9
,
1
1
0
7
0
,
8
2019
5
6
0
,
8
4
3
0
,
7
2020
3
2
8
,
0
1
0
4
3
,
9
2021
Mechanical
Refractory
External Sales: Geographical Segmental Analysis
16%
21%
8%
30%
25%
United Kingdom
Rest of World
Pacific Basin
Rest of Europe
USA
End-User Market Sectors: £131m Sales Turnover
10%
23%
36%
31%
Jewellery
Manufacture,
Powders,
Heat Resistant
Applications,
Moulds for
Tyres & Industry
Power, Defence,
Construction,
Radar
Oil & Gas, LNG,
Petrochemical
Mining
In the year to 30th April, 2021, the Mechanical
Engineering Division generated 54% of the
Group’s operating profit and the Refractory
Engineering Division generated 46%.
The split between the divisions remains largely
unchanged due to the strong performance of
the Refractory Engineering division
the
second half of the year driven by high levels of
consumption of the division’s products in the
jewellery, construction and horticultural sectors.
This has been aided by the integration of the
Castaldo product lines into the product portfolio
along with other growing product offerings.
in
Whilst the Mechanical Engineering division’s
revenue decreased by 14%, its pre-tax operating
profit improved by 34% as a result of the higher
margin contracts for nuclear decommissioning
and naval vessel building programmes starting
to ramp up as compared to the margins available
in the declining oil industry.
The upturn in demand seen within the Refractory
Engineering end markets coupled with the
additional contribution earned by the new and
growing product lines such as Castaldo rubber,
Soluform concrete bags and AVD fire extinguisher
sales has enabled the division to generate the
same revenue as the prior year, despite the
first three quarters being significantly down on
traditional investment casting powder sales.
During the course of the year, the divisional global
footprint helped mitigate the impact of the
ongoing global shipping crisis and improve its
reported pre-tax operating margin by 5% whilst
also increasing market penetration as competitors
that relied on importing product suffered major
delays.
Geographical segmental analysis, we expect a
greater proportion of the foundry revenue to be
generated from the US as naval vessel building
programmes accelerate in the years ahead. Of
the £21,473,000 sales to the rest of Europe, 40%
relate to the European sales of our German
domiciled subsidiary, Noreva GmbH.
9
GROUP STRATEGIC REPORT
OBJECTIVES, STRATEGY AND BUSINESS MODEL (continued)
KEY PERFORMANCE INDICATORS
The key performance indicators for the business are listed below:
Gross profit as a %
of turnover *
Profit before tax
(£ millions)
Gearing % (excluding
deferred consideration)
Sales per employee per
year (£’000)
Dividends proposed
(in £ millions)
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
27.3
28.5
31.9
34.3
32.5
27.8
25.6
28.6
32.0
24.1
29.7
8.1
12.3
20.3
24.1
20.1
12.3
9.2
13.3
14.7
12.1
16.5
22%
26%
23%
5%
12%
26%
31%
11%
20%
18%
15%
106
114
126
124
112
105
114
120
117
121
116
2.1
2.3
3.8
3.0
3.0
3.0
3.0
6.0
6.9
6.0
7.9
Gross Profit as a % of Turnover
Profit before Tax (£ million)
35%
30%
25%
20%
15%
10%
5%
0%
3
.
7
2
5
.
8
2
9
.
1
3
3
.
4
3
5
.
2
3
8
.
7
2
6
.
5
2
6
.
8
2
0
.
2
3
1
.
4
2
7
.
9
2
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
25
20
15
10
5
0
1
.
8
3
.
2
1
3
.
0
2
1
.
4
2
1
.
0
2
3
.
2
1
2
.
9
3
.
3
1
7
.
4
1
1
.
2
1
5
.
6
1
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Gearing % (excluding deferred consideration)
Sales per employee per year (£’000)
35%
30%
25%
20%
15%
10%
5%
0%
2
2
6
2
3
2
5
2
1
6
2
1
3
1
1
0
2
8
1
5
1
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
130
125
120
115
110
105
100
95
5
0
1
4
1
1
6
2
1
4
2
1
2
1
1
5
0
1
4
1
1
0
2
1
7
1
1
1
2
1
6
1
1
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Dividends (£ million)
9
8
7
6
5
4
3
2
1
0
D
E
S
O
P
O
R
P
1
.
2
3
.
2
8
.
3
0
.
3
0
.
3
0
.
3
0
.
3
0
.
6
9
.
6
0
.
6
9
.
7
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
10
The alternative performance measures
referred to above are defined in note 34
on page 84. The alternative performance
measures are important to management and
the readers of the Annual Report in assessing
the Group’s performance and benchmarking
it within its respective industries.
* The calculation of Gross Profit is after taking
into account plant depreciation, training, HR,
R&D, sales, exhibition and sales travel costs,
as well as the material and labour costs.
GROUP STRATEGIC REPORT
OBJECTIVES, STRATEGY AND BUSINESS MODEL (continued)
DIVIDEND AND CAPITAL EXPENDITURE POLICY
Based on the Group generating post tax profits plus depreciation and amortisation of £20,690,000
for the year ending 30th April, 2021, up 31% on the previous year, the Board proposes to pay a
dividend of 102.24 pence per share (2020: 81.71 pence).
The gearing of the Group finished at 15.4% (2020: 17.9%). The Board continues to monitor its
capital expenditure to ensure that shareholder funds re-invested into the Company are targeted
on activities that should provide long-term benefit to the Company, its employees and its
shareholders.
Group Annual Post Tax Profit + Depreciation + Amortisation
£25m
£20m
£15m
£10m
£5m
£0m
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
11
GROUP STRATEGIC REPORT
PRINCIPAL RISKS AND UNCERTAINTIES
The Group's operations expose it to a variety of risks and uncertainties. The Directors confirm that they have
carried out a robust assessment of the principal risks facing the Company, including those that would threaten
its business model, future performance, solvency or liquidity.
Covid-19 risk: The Covid-19 pandemic continues to have a global impact in varying degrees affecting the
population, travel, supply chains, and the global marketplace. The spread temporarily impacted market demand
for certain of our products in the first half of the financial year just completed, as well as delaying the placement
of larger capital orders by our customers. We have also been contending with increased costs and shipping
times from our overseas suppliers which have also been exacerbated by the grounding of the “Ever Green”
container ship in the Suez Canal which whilst afloat has only just docked. It is being suggested that the
combination of Covid-19 and the Ever Green incident will result in shipping costs and times being disrupted for at
least another two years. The intercountry supply chain may face difficulties in the short to medium term in
timely and economically fulfilling our requirements due to the stretched international shipping network, but
fortunately we have so far been able to work around these issues. During the year the Group continued to
dynamically adapt as circumstances changed to protect the wellbeing of the workforce and to ensure facilities
remained operational and able to satisfy the orders in hand, which maintained the Group’s financial strength.
Market risk: The Group provides a range of products and services, and there is a risk that the demand for these
products and services will vary from time to time because of competitor action or economic cycles or international
trade friction or even wars. As shown in note 3 to the financial statements, the Group operates across a range
of geographical regions, and its turnover is split across the UK, Europe, USA, the Pacific Basin and the Rest of
the World.
This spread reduces risk in any one territory. Similarly, the Group operates in both mechanical engineering and
refractory engineering sectors, mitigating the risk of a downturn in any one product area as was seen over the
past three financial years.
The potential risk of the loss of any key customer is limited as, typically, no single customer accounts for more
than 10% of annual turnover.
As described in the Business Model, and to emphasise the Group’s spread of market risk, the Mechanical
Engineering Division generates significant sales not only from valves it supplies to oil, gas, chemical and water
markets, but increasingly significant amounts from other areas such as nuclear new build and decommissioning,
naval propulsion marine applications, and ship hull components. With the submersible pumps that are supplied
to the mining industries and radar systems that are supplied for civil and defence applications it is clear that the
mechanical engineering is now well diversified. Within the Refractory Engineering Division, we manufacture and
sell vermiculite and perlite products to the insulating, horticulture and fire prevention industries and our
investment casting powder companies indirectly sell to the jewellery consumer market through the supply of
investment casting moulding powders, waxes, silicone and natural rubber and so again we see a good spread
of business within this division.
Technical risk: The Group develops and launches new products as part of its strategy to enhance the long-term
value of the Group. Such development projects carry business risks, including reputational risk, abortive expenditure
and potential customer claims which may have a material impact on the Group. The potential risk here is seen as
manageable given the Group is developing products in areas in which it is knowledgeable and new products are
tested prior to their release into the market.
Product failure/Contractual risk: The risks that the Group supplies products that fail or are not manufactured
to specification are risks that all manufacturing companies are exposed to but we try to minimise these risks
through the use of highly skilled personnel operating within robust quality control system environments, using third
party accreditations where appropriate. With regard to the risk of failure in relation to new products coming on
line, the additional risks here are minimised at the research and development stage, where prototype testing and
the deployment of a robust closed loop product performance quality control system provides feed back to the
design department for the products we manufacture and sell. The risk of not meeting safety expectations, or
causing significant adverse impacts to customers or the environment, is countered by the combination of the
controls mentioned within this section and the purchase of product liability insurance. The risk of product
obsolescence is countered by research and development investment.
Supply chain and equipment risk: Failure of a major supplier or essential item of equipment presents a constant
risk of disruption to the manufacturing in progress. Where reasonably possible, management mitigates and
controls the risk with the use of dual sourcing, continual maintenance programmes, and by carrying adequate levels
of stocks and spares to reduce any disruption.
Health and safety: The Group’s operations involve the typical health and safety hazards inherent in manufacturing
and business operations. The Group is subject to numerous laws and regulations relating to health and safety around
the world. Hazards are managed by carrying out risk assessments and introducing appropriate controls, as well as
attending safety training courses.
Acquisitions: The Group’s growth plan over recent years has included a number of acquisitions. There is the risk
that these, or future acquisitions, fail to provide the planned value. This risk is mitigated through financial and
technical due diligence during the acquisition process and the Group’s inherent knowledge of the markets they
operate in.
12
GROUP STRATEGIC REPORT
PRINCIPAL RISKS AND UNCERTAINTIES (continued)
Financial risk: The principal financial risks faced by the Group are changes in market prices (interest rates, foreign
exchange rates and commodity prices). Detailed information on the financial risk management objectives and
policies is set out in note 26 to the financial statements. The Group has in place risk management policies that
seek to limit the adverse effects on the financial performance of the Group by using various instruments and
techniques, including credit insurance, stage payments, forward foreign exchange contracts, secured and unsecured
credit lines. As reported elsewhere within these financial statements the Company, on 2nd July, 2021, has
acted to mitigate the possible impact of higher interest rates by taking out an interest rate swap derivative
fixing £30 million of notional debt at less than 1% versus the variable inter-bank lending rate (SONIA) for a period
of ten years.
Regulatory compliance: The Group’s operations are subject to a wide range of laws and regulations. Both within
Goodwin PLC and its subsidiaries, the Directors and Senior Managers within the companies make best endeavours
to ensure we comply with the relevant laws and regulations.
IT security: The Group performs regular and remote off site backups of its IT systems, from time to time engaging
external companies to test and report any weaknesses and deficiencies found to enable solutions to be put in
place to mitigate and minimise the risk of an IT security breach.
Brexit: As envisaged and disclosed in previous Annual Reports Brexit has not been seen as a significant issue to
the Group, the previously identified risks have been managed or mitigated and the Board no longer consider this
as a significant uncertainty.
13
GROUP STRATEGIC REPORT
CORPORATE SOCIAL RESPONSIBILITY
The Board as a whole is responsible for decisions relating to the long-term success of the Company and the way in
which their duties have been discharged during the year in terms of the strategic, operational and risk management
decisions and these can be found within the Strategic Report on pages 7 to 10.
As set out below and in line with Section 172 of the Companies Act 2006, through engagement the interests and
views of the Group’s employees and other stakeholders are considered by the Board within its decision making
process as well as the impact they have on the environment, our reputation and the surrounding communities.
Employees
Health and Safety: The Group acknowledges that many of its manufacturing processes and some materials that it
handles and sells are hazardous and that providing a safe environment for people at all of our facilities is an
unconditional priority for all of those charged with governance, in addition to each member of the workforce.
Awareness and training to continually reduce risk and improve safety is a mind-set that is reinforced on a daily
basis through the ongoing rollout Group’s “Safety Spectrum” programme. Furthermore in the year the Board
regularly updated all employees on the latest situation on Covid-19 and the measures being taken by the business
in line with the applicable guidance issued by the Government.
We have 18 people whose full time efforts are dedicated to :
a) Risk analyses
b) Writing safe operating and maintenance procedures
c) Ensuring our packing, material handling, customer safety data we provide to customers is fit for purpose.
d) Analysing near misses, accidents and failures to ensure appropriate action is taken to make the operating
environment at our factories and offices become safer.
e) Training within the subsidiaries.
Employee consultation: The Group takes seriously its responsibilities to employees and, as a policy, provides
employees systematically with information on matters of concern to them. It is also the policy of the Group to
consult where appropriate, on an annual basis, with employees or their representatives so that their views may
be taken into account in making decisions that are likely to affect their interest and the continual development of
the Group. The Board considers the most effective form of engagement and communication with its employees
for its size and complexity is by way of informal daily discussions between the employees, the Senior Management
and Board members who walk the floor. Engagement in the year is further supported through workforce
representative meetings, local working groups, team meetings, training, and an honest and open culture.
Employment of disabled persons: The policy of the Group is to offer the same opportunity to disabled people, and
those who become disabled, as to all others in respect of recruitment and career advancement, provided their
disability does not prevent them from carrying out the duties required of them in accordance with the requirements
of the Equality Act 2010.
Diversity Policy: The Group is committed to ensuring that everyone should have the same opportunities for
employment and promotion based on ability, qualifications and suitability for the work in question. The Group
invests in training and development of skills for the Group’s future and has a long-term aim that the composition
of our workforce should reflect that of the community it serves. The Group continues to strive to improve the
balance of diversity by reviewing gender reporting and implementing our Diversity Policy through training and
development, recruitment, our business culture and the Board’s Strategy.
The Group’s approach to investing and rewarding its employees can be found within the Corporate Governance
Report on page 21 and the Directors’ Remuneration report on pages 25 to 31, as well as being evidenced by our
apprentice programme.
The following tables set out the breakdown of our average number of employees and Board members by gender
and age:
Breakdown by gender
Year ended 30th April, 2021
Main Board and Company Secretary
Senior Management
Employees
Total
Male
6
71
851
928
%
75
88
82
82
Female
2
10
189
201
%
25
12
18
18
Total
8
81
1,040
1,129
14
GROUP STRATEGIC REPORT
CORPORATE SOCIAL RESPONSIBILITY (continued)
Breakdown by age
Year ended 30th
April, 2021
Main Board and
Company Secretary
Senior Management
Employees
Total
Age
16 to
21
0
0
77
77
Age
22 to
40
6
14
472
492
%
75
17
45
44
Age
41 to
65
1
62
474
537
%
0
0
7
7
%
12
77
46
47
Age
Over 65
1
5
17
23
%
13
6
2
2
Total
8
81
1,040
1,129
Suppliers, Customers and Regulatory Authorities
The Board considers market trends regularly and reviews their likely long-term implications. Our business
relationships and procedures are developed over time and are regularly reviewed to ensure as a Group we
conduct business responsibly and sustainably. The Board acquires a first-hand understanding of its business
relationships through regular dialogue and site visits where appropriate. Engagement is ensured from the initial
tender processes to embedded sales and engineering project meetings and reinforced by an open door culture,
whilst actively seeking feedback. During the year our engagement with customers, suppliers and other bodies
has been supported by Goodwin’s mandatory principles and good practice guidelines have been incorporated
and issued within a contract guide handbook.
The six Executive Directors of the Board are actively involved with the day to day business and management of the
subsidiaries thereby allowing a good understanding of key members of the supply chain and also ensuring a fair
purchase culture.
Maintaining High Standards of Business Conduct
We are committed to conducting business responsibly and ethically. We endeavour to ensure that our staff,
suppliers and business partners adopt the same or similar high ethical standards and values. This applies, but is
not limited to human rights, modern slavery, anti-bribery and corruption and is all enhanced by an anonymous
whistle-blowing system.
Shareholders
Shareholder engagement occurs through the Annual Report, regulatory disclosures, our website and the
Annual General Meeting, coupled by supplementary RNS announcements made during the course of the year.
The Company has one class of ordinary shares, which have the same rights as regards voting, distributions and
on liquidation. Management are also significant shareholders in the Company, holding approximately 53.23%
of the register. In accordance with LR6.5, there is a controlling shareholder agreement in place. On this basis
the Board feels that the Executive Directors are fully aligned with shareholders.
Communities and Environment
Communities
During the year the Group has continued to communicate to all employees our culture of responsibility and
support for local communities where possible. The Board encourages its sites to support their local communities
through charitable activities and initiatives to support the local area within which they operate. Engagement
occurs through collaboration with local schools where engineering and ’Women in Engineering’ is promoted.
Furthermore, regular dialogue is maintained with the local councils and charities.
Donations
The Group made no political donations during the year (2020: £nil).
Donations by the Group for charitable purposes amounted to £78,000 (2020: £54,000). The majority of these
were made to local communities within the Group’s operating environments.
Environment
Whilst the Group continues to seek to achieve high standards in the management of environmental matters, the
Board is aware of the Group’s impact on the environment and the importance of sustainability and is therefore
undertaking a methodical in-depth analysis of how it can adapt in the years to come to minimise and / or eliminate
its adverse effects on the environment. The results of the work being undertaken will form part of the Group’s
“Balance and Reduce” initiative that will set out realistic targets and timeframes in which it will be achieved.
The initiative report will be finalised and disclosed within next year’s Annual Report.
15
GROUP STRATEGIC REPORT
CORPORATE SOCIAL RESPONSIBILITY (continued)
Greenhouse Gas (“GHG”) emissions
In line with the GHG reporting guidance set out by SECR (Streamlined Energy and Carbon Reporting) we have
used the GHG Reporting Protocol methodology to report our Scope 1 and Scope 2 emissions. Overseas electricity
factors have been taken from the latest IEA ©OECD/IEA documentation, covering both OECD and non OECD
countries.
The reported CO2 emissions are detailed below:
2021
Tonnes of CO2e
Proportion
of emissions
arising from
UK operations
%
2020
Tonnes of CO2e
Proportion
of emissions
arising from
UK operations
%
27,293
98%
38,494
98%
5,176
83%
6,882
82%
32,469
242
45,376
313
69,737,248
76,786,289
Scope 1 – direct emissions
(from Company facilities
and vehicles)
Scope 2 – indirect emissions
(from electricity purchased
for own use)
Total Scope 1 and
Scope 2 emissions
Intensity – emissions of total
CO2 equivalent reported above
per £1 million of Group revenue
Energy Consumption (kWh)
resulting in the above reported
emissions
Partly as a result of Covid-19 impacting our activity our overall emissions have marginally reduced in the year.
FORWARD-LOOKING STATEMENTS
The Group Strategic Report contains forward-looking type statements and information based on current
expectations, and assumptions and forecasts made by the Group. These expectations and assumptions are
subject to various known and unknown risks, uncertainties and other factors, which could lead to substantial
differences between the actual future results, financial performance and the estimates and historical results
given in this report. Many of these factors are outside the Group’s control. The Group accepts no liability to
publicly revise or update these forward-looking statements or adjust them for future events or developments,
whether as a result of new information, future events or otherwise, except to the extent legally required.
The Group Strategic Report was approved by the Board on 11th August, 2021 and is signed on its behalf by:
T. J. W. Goodwin
Director
M. S. Goodwin
Director
S. R. Goodwin
Director
16
DIRECTORS’ REPORTS
REPORT OF THE DIRECTORS
The Directors have pleasure in presenting their reports and audited financial statements for the year ended
30th April, 2021.
The Directors have presented their Group Strategic Report on pages 3 to 16. The Group Strategic Report is intended
to be an analysis of the development and performance of Goodwin PLC and contains a description of the principal
risks and uncertainties facing the Group and an indication of likely future developments. The Chairman’s Statement
is part of the Group Strategic Report of the Directors for the year and provides the financial review, including some
of the key performance indicators and future trends of the business. Also included in the Group Strategic Report for
the year are the Group’s Objectives, Strategy and Business Model on page 7, Principal Risks and Uncertainties on
page 12, and the Corporate Social Responsibility Report on pages 14 to 16.
The Board considers that the Chairman’s Statement, the Group Strategic Report, the Directors’ Reports and the
Financial Statements, taken as a whole, are fair, balanced and understandable and that they provide the information
considered appropriate for shareholders to assess the Group’s position and performance during the financial year
and at the year end, and to assess the business model and strategy.
Proposed ordinary dividends
The Directors recommend that an ordinary dividend of 102.24p per share (2020: 81.71p) be paid to shareholders
on the register at the close of business on 17th September, 2021. If approved by shareholders, the ordinary dividend
will be paid to shareholders on 8th October, 2021.
See comments on page 11 regarding the Dividend Policy.
Directors
The Directors of the Company who have served during the year are set out below.
M. S. Goodwin
S. R. Goodwin
T. J. W. Goodwin
J. Connolly
S. C. Birks (retired on 11th December 2020)
B. R. E. Goodwin
N. Brown (appointed on 11th December 2020)
J. E. Kelly (Non-Executive Director)
The Chairman and the Managing Directors do not retire by rotation.
No Director has a service agreement with the Company, nor any beneficial interest in the share capital of any
subsidiary undertaking. The Chairman does not have any other significant external appointments.
Shareholdings
The Company has been notified that as at 6th August, 2021, the following had an interest in 3% or more of the issued
share capital of the Company:
J. W. and R. S. Goodwin 2,129,153 shares (27.69%), J. W. and R. S. Goodwin 1,424,210 shares (18.52%). These shares
are registered in the names of J. M. Securities Limited and J. M. Securities (No. 3) Limited respectively. J. H. Ridley
501,709 shares (6.52%), Rulegale Nominees Limited (JAMSCLT) 428,091 shares (5.57%) and Rulegale Nominees
Limited (ISA001) 235,460 shares (3.06%).
In line with LR 9.2.2AB R, relating to Controlling Shareholders, the Company confirms that a written and legally
binding agreement is in place, and has complied with the independence provisions set out in LR 6.5.4 R.
The Company confirms that, as far as it is aware, the controlling shareholders have complied with this agreement.
Share capital
The Company’s issued share capital comprises a single class of share capital which is divided into ordinary shares
of 10p each. Information concerning the issued share capital in the Company is set out in note 25 to the financial
statements on page 73.
All of the Company’s shares are ranked equally and the rights and obligations attaching to the Company’s shares are
set out in the Company's Articles of Association, copies of which can be obtained from Companies House in England
and Wales or by writing to the Company Secretary.
There are no restrictions on the voting rights of shares and there are no restrictions in their transfer other than:
• certain restrictions as may from time to time be imposed by laws and regulations (for example, insider trading
laws); and
• pursuant to the Market Abuse Regulation whereby Directors of the Company require approval to deal in the
Company’s shares.
Additionally, the Company is not aware of any agreements between shareholders of the Company that may result
in restrictions on the transfer of ordinary shares or voting rights.
Following the passing of a Resolution at the Company’s Annual General Meeting on 5th October, 2016, to approve
an Equity Long Term Incentive Plan (“LTIP”) for the Executive Directors, the Directors have statutory authority to
issue shares in connection with the exercise of options granted under the LTIP. The Directors have not been given
17
DIRECTORS’ REPORTS
REPORT OF THE DIRECTORS (continued)
Share capital (continued)
authority to issue shares of the Company other than in respect of the LTIP nor have they been given any authority
to buy back any shares. The LTIP earn-out for each of the eight Directors, who were eligible under the scheme, when
it was approved, is 61,200 shares each and these are exercisable within five years from 1st May, 2019. Details of the
options exercised during the year are reported in the Annual Directors’ Remuneration Report on page 31.
Research and development
The Group invests significantly in research and development. The more material investments during the year
include the biodegradable concrete bags marketed under our brand name Soluform, the manufacturability of
complex castings in high yield material grades and production process development for the manufacture of
polyimide polymers. In addition to this, further investment has gone into the ‘respirable silica free’ investment
casting powder for the global jewellery industry and the Group’s range of axial control valves.
Change in control
The Group’s committed loan facilities include a change of control clause, which states that a change of control of
the parent Company will be classed as an event of default and would enable the providers at their discretion to
withdraw the facilities.
Stakeholders relations
All shareholders are encouraged to participate in the Company’s Annual General Meeting. No shareholder meeting
has been called to discuss any business other than ordinary business at the Annual General Meeting.
The Board complies with the recommendations of the UK Corporate Governance Code that the notice of the Annual
General Meeting and related papers should be sent to shareholders at least twenty working days before the meeting.
The Directors attend the Annual General Meeting. The Chairman and other members of the Board and the Chair of
the Audit Committee and Audit Committee members will be available to answer questions at the forthcoming
Annual General Meeting. In addition, proxy votes will be counted and the results announced after any vote on a
show of hands.
The Chairman ensures that the views of shareholders are communicated to the Board as a whole, ensuring that
Directors develop an understanding of the views of shareholders. Any individual requests for information from
shareholders are dealt with by the Chairman, and where any such requests are subject to restraint in that
where any disclosure would give rise to share price sensitive information, then the requests would be declined,
or referred to the Board for release to all shareholders through the Stock Exchange.
Engagement with the Group’s suppliers, customers and other stakeholders can be found within the Strategic Report
on pages 14 and 15.
Going concern
The Directors, after having reviewed the projections and possible challenges that may lie ahead, believe that there
is a reasonable expectation that the Group has adequate resources to continue in operational existence for at
least twelve months from the date of approval of these financial statements, and have continued to adopt the
going concern basis in preparing the financial statements.
During April 2021, the Company repaid in full the £30 million drawn down from the Bank of England’s CCFF scheme
and having completed the refinancing of £10 million referred to within the 30th April 2020 accounts, currently has
at its disposal £50.5 million of bank facilities, £44.5 million of which are vested in long-term committed facilities.
The Directors have, as part of this going concern assessment, considered the ongoing impact of Covid-19 on the
Group’s operations. We are now more than eighteen months on from the onset of Covid-19 and whilst we
experienced a slow down in the Refractory Engineering segment of the business during March 2020 to August
2020, since then most of the entities in this division are seeing record levels of activity. As predicted when writing
the 30th April, 2020 going concern assessment, there has been little Covid-19 impact on the Mechanical Engineering
segment of the business. Whilst we have and are still seeing temporary impacts on our overseas pump company
operations, we are thankfully seeing minimal impact on Group activities as a result of the virus pandemic.
Within our severe but plausible downside model, it is demonstrable that the Group has sufficient funds to cover
the Group’s and the Company’s financial commitments during the forecast period whilst remaining compliant
with its financial covenants. The downside model factors in adverse circumstances such as unexpected problems
on contracts and a further Covid-19 impact on our Refractory Engineering segment.
Since the end of the financial year, the Company has entered into a ten year interest rate swap agreement which
fixes our variable interest rate on borrowings at less than 1% for the entire period. The Directors see no shortage of
investment opportunities in the coming years and so given the historical low level of interest rates, we deemed it
prudent to remove the impact of higher interest rates from our risk modelling.
Whilst our carrying values of trade debtors and contract assets are significant, we see little risk here in terms of
recovery. We credit insure our debtors and pre credit risk (work in progress) and for significant contracts where
credit insurance is not available, we ensure, where possible, that these contracts are backed by letters of credit
or cash positive milestone payments.
As discussed elsewhere within these accounts, the Mechanical Engineering order book remains very high and
the Refractory Engineering segment is buoyant.
18
DIRECTORS’ REPORTS
REPORT OF THE DIRECTORS (continued)
Going concern (continued)
The Directors are confident that the Group and Company will have sufficient funds to continue to meet their
liabilities as they fall due for at least twelve months from the date of approval of the financial statements and
therefore have prepared the financial statements on a going concern basis.
Viability Statement
In accordance with provision 31 of the UK Coporate Governance Code the Directors have assessed the Group’s
viability over a three year period to 30th April, 2024.
While the Board has no reason to believe that the Group will not be viable over a longer period, the Board
believes that a three year review period is prudent, and provides the readers of the report with a sensible degree
of confidence.
As part of the going concern review process we have considered the impact of plausible adverse events over an
extended period (the two years ended 30th April, 2024). The plausible adverse event scenarios have been modelled
without adjusting the capital expenditure programme. The results demonstrate that the Group has sufficient facilities
in place to deal with these adverse events and given that a large proportion of the future capital expenditure is by
definition discretionary, there is further confidence that a downturn will not impact on the Group’s ability to deal
with material adverse events.
The workload within the Mechanical Engineering segment remains high and so underpinning performance in the
short to medium term. This, coupled with our actual trading performance during the height of the pandemic,
the Directors are able to confirm that they have a reasonable expectation that the Group will be able to continue
in operation and remain viable over this extended three year period.
Corporate governance statement
The Company’s Corporate Governance Statement is set out on pages 20 to 21 and forms part of the Directors’
Report.
Financial Risk Management
The Group has in place risk management policies that seek to limit the adverse effects on the financial performance
of the Group by using various instruments and techniques, further details can be found within note 26 on page 73.
Subsequent Events
On 2nd July, 2021, the Company contracted to convert £30 million of notional debt into a fixed rate of interest
of less than 1% versus the floating inter-banking lending rate (SONIA) for a period of ten years. With the level of
expected trade and the opportunities open to the Group going forwards, the Directors deemed it prudent to fix its
variable lending rate as an insurance policy against escalating interest rates in the light of the current and
expected increases in inflation over the ten year period.
Auditor
In accordance with Section 489 of the Companies Act 2006 and the recommendation of the Board of Directors,
a resolution is to be proposed at the Annual General Meeting for the re-appointment of RSM UK Audit LLP as
auditor of the Company.
Approved by the Board of Directors and signed on its behalf by:
T. J. W. Goodwin
Chairman
11th August, 2021
19
DIRECTORS’ REPORTS
CORPORATE GOVERNANCE REPORT
Introduction
The Board comprises six Executive Directors and an independent Non-Executive Director; the Audit Committee
comprises the Non-Executive Director, who is the Audit Committee Chair, and three other members, the previous
Chairman, the previous Managing Director and the previous Company Secretary, all of whom had held these
positions for twenty-seven years and have very substantial knowledge and experience of the diversified Group’s
people, product ranges and the very diversified overseas markets in which the Group operates. The Board and
the Audit Committee fulfil the roles required for effective corporate governance and the Board considers that it
has the right governance to execute its strategy to achieve its objectives.
The Board has always felt that it should be recognised that what may be appropriate for the larger company may
not necessarily be so for the smaller company, a point raised previously in the Cadbury Code of Best Practice. Whilst
conscious of its non-compliance with certain aspects of the revised Code as detailed below, we do not believe
that at this stage in the Group’s development and circumstances it is appropriate to change its own operational or
governance structure with the sole objective of achieving compliance with the revised Code given that the Board’s
current corporate governance strategy has been accepted by a large majority of its shareholders.
For the past six years the Company has had one Non-Executive Director who is also the Chair of the Audit
Committee, which has three other members as described above. This is not in full compliance with the revised Code,
but for a smaller company, due to the limits of time, availability and cost, the Board considers this as an optimum
compromise that is beneficial to shareholders and the Group’s long-term interests. For specific independent expertise
the Board engages independent consultants.
Compliance statement under the UK Corporate Governance Code 2018
The Company is required to report on compliance throughout the year. In relation to all of the provisions except
those mentioned below, the Company complied throughout the period.
As noted in the introduction above, the Group does not comply with aspects of the Code’s requirements under
provisions 11 and 13 and provision 12 in terms of having a senior independent Director. Since 14th April, 2015 a
Non-Executive Director with the role of Chair of the Audit Committee has been appointed. The Group does not
have a Remuneration Committee or a Nominations Committee as required under provisions 17, 32, 33 and 41.
The roles of the Chairman in running the Board and the Managing Directors in running the Group’s businesses are
well understood. It is not considered necessary to have written job descriptions. This is contrary to provision 14.
The Chairman and Managing Directors do not retire by rotation, which is contrary to provision 18 of the Code.
The Board
During the year, the Board met formally thirteen times, and details of attendees at these meetings are set out below:
M. S. Goodwin … … … … … 13 out of 13 attended
S. R. Goodwin … … … … … 13 out of 13 attended
T. J. W. Goodwin … … … … … 13 out of 13 attended
J. Connolly … … … … … … 13 out of 13 attended
S. C. Birks (retired 11th December, 2020) …
8 out of 13 attended
B. R. E. Goodwin … … … … … 13 out of 13 attended
N. Brown (appointed 11th December, 2020)
6 out of 13 attended
J. E. Kelly … … … … … … 11 out of 13 attended
The Chairman and Managing Directors do not retire by rotation. With this exception, all Directors retire at the first
Annual General Meeting after their initial appointment and then by rotation at least every three years, which is
contrary to provision 18 of the Code.
The Board retains full responsibility for the direction and control of the Group and, whilst there is no formal schedule
of matters reserved for the Board, all acquisitions and disposals of assets, investments and material capital-related
projects are, as a matter of course, specifically reserved for Board decision, but referred to the Audit Committee for
comment.
The Board meets regularly with an agenda to discuss corporate strategy; to formulate and monitor the progress of
business plans for all subsidiaries and to identify, evaluate and manage the business risks faced. The management
philosophy of the Group is to operate its subsidiaries on an autonomous basis, subject to overall supervision and
evaluation by the Board, with formally defined areas of responsibility and delegation of authority. The Group has
formal lines of reporting in place with subsidiary management meeting with the Board on a regular basis.
Regular informal meetings are also held to enable all members of the Board to discuss relevant issues with local
management and staff at the business units.
The Audit Committee
The Audit Committee is made up of the following: J.E. Kelly (Chair), J.W. Goodwin, R.S. Goodwin and P. Ashley and
the Audit Committee reports to the Board. The Audit Committee has met formally eight times since the issue of
the Annual Report for the year ended 30th April, 2020, with all members attending each meeting. The responsibility
of the Audit Committee is explained in the Audit Committee Report on pages 22 to 24. The Audit Committee
takes into account the Company’s corporate Mission Statement, Objectives and Strategy, and reviews investor
correspondence and comments, regulatory changes, current issues and market trends. The Audit Committee uses
expert opinion where considered appropriate.
20
DIRECTORS’ REPORTS
CORPORATE GOVERNANCE REPORT (continued)
Board evaluation
The Managing Directors, Chairman and Audit Committee address the development and training needs of the Board
as a whole. An evaluation of the effectiveness and performance of the Board and the Directors of subsidiaries has
been carried out by the Managing Directors, Chairman and Audit Committee, by way of personal discussions and
individual performance evaluation.
All Directors have reasonable access to the Company Secretary and to independent professional advice at the
Company’s expense.
External audit
The external auditor is appointed annually at the Annual General Meeting. The Board, following review and
recommendations received from the Audit Committee, considers the appointment of the auditor, and assesses on
an annual basis the qualification, expertise, cost, independence and objectivity of the external auditor. In addition,
the Audit Committee monitors the level of non-audit services provided to the Group by the external auditor to
ensure that their independence is not compromised.
Disclosure of information to auditor
The Directors who held office at the date of approval of this Corporate Governance Report confirm that, so far as
they are each aware, there is no relevant audit information of which the Company’s auditor is unaware; and each
Director has taken all the steps that he or she ought to have taken as a Director to make himself or herself aware of
any relevant audit information and to establish that the Company’s auditor is aware of that information.
Internal control and risk management
The Board has overall responsibility for the Group’s systems of internal controls and risk management which are
designed to manage rather than eliminate risk and provide reasonable reassurance against material misstatement
or loss.
The Board has primary responsibility for controlling: operational risks; financial risks including funding and capital
spend; compliance risks; and political risks. The Audit Committee has been delegated responsibility for corporate
reporting, financial risk management and to regularly review the effectiveness of the Group’s internal controls
together with consideration of any reports from the external auditor. The Audit Committee Report is on pages
22 to 24. Except as noted within this Corporate Governance Report, the Board confirms that the internal control
systems comply with the UK Corporate Governance Code.
The Group’s main systems of internal controls include regular visits and discussions between Board Directors and
Subsidiary Management, in-house General Counsel, Health and Safety Committee and the Group internal auditor,
on all aspects of the business including financial reporting, risk reporting and compliance reporting. In addition,
there is Board representation with Goodwin PLC Directors on the boards of the subsidiaries. Any concerns are
reported to the members of the Audit Committee and to the Board. The Group maintains a risk register, has
business continuity programmes and has insurance programmes that are all regularly reviewed. These procedures
have been in place throughout the year and are ongoing to endeavour to ensure accordance with the FRC publication
‘Risk Management, Internal Control and Related Financial and Business Reporting'. The Board considers that the
close involvement of Board Directors in all areas of the day to day operations of the Group’s business, including
considering reports from management and discussions with senior personnel throughout the Group, represents the
most effective control over its financial and business risks system, by providing an ongoing process for identifying,
evaluating and managing the principal risks faced by the Group. In particular, authority is limited to Board Directors
in key risk areas such as treasury management, capital expenditure and other investment decisions.
The close involvement of Board Directors in the day to day operations of the business ensures that the Board has
the financial and non-financial controls under constant review and so it is not currently considered that formal
Board reviews of these controls would provide any additional benefit in terms of the effectiveness of the Group’s
internal control systems.
The Board recognises the importance of an effective internal audit function to assist with the management and
review of internal controls and business risk. The Group internal auditor continues to make good progress
reviewing internal controls, procedures and accounting systems, though this has been difficult during the
financial year due to the worldwide Covid-19 pandemic. The Board of Directors and Senior Management will
continue to have close involvement on a day to day operational basis and the scope and results of internal
audit work to be performed will be kept under review in the coming year.
The Board considers that certain functions are best carried out by independent external bodies with specific
expertise, who then report to the Board directly or through the Audit Committee.
The Board confirms that it has not been advised of any material failures or weaknesses in the Group’s internal
control systems.
Approved by the Board of Directors and signed on its behalf by:
T. J. W. Goodwin
Chairman
21
11th August, 2021
DIRECTORS’ REPORTS
AUDIT COMMITTEE REPORT
The key role of the Audit Committee is to provide confidence in the integrity of the Group’s financial risk management,
internal financial controls and corporate reporting. The Audit Committee, as empowered by the Group’s Board of
Directors, has responsibility for:
1. Reviewing and checking the Group’s full year and half year Accounts and the Annual Report, as presented to
the Audit Committee.
2. Reviewing the Group’s financial and non-financial internal controls and risk management systems and
commenting on whether they are relevant and effective.
3. Making recommendations to the Group’s Board of Directors on the appointment and remuneration of the
Group’s external auditor; ensuring independence of the auditor; the effectiveness of the audit process; and
that the Group receives value for money from the audit.
4. Reviewing comments and feedback brought to its attention by Directors or other employees of the Group.
5. Reviewing and commenting to the Board on any significant investment plans of the Group.
6. Reviewing the Group’s “whistle-blowing” procedures and reviewing any significant reports.
7. Reviewing the scope of work for the internal audit function and the resultant reports.
8. Reviewing significant accounting estimates and judgements relating to the financial statements with the
external auditor and members of the Board.
The Audit Committee discharges each of its above responsibilities as follows:
1. Examining the integrity of the Group’s Annual Report and half year Interim Report:
The Chair of the Audit Committee is an independent Non-Executive Director. The other members of the
committee either are persons with experience in the Group’s typical products and or markets or have vast
historical knowledge of the business and activities of the Group. This, together with their regular involvement in
reviewing the Group’s financial performance and accounts, provides sufficient recent financial experience.
Regular meetings are held between members of the Audit Committee, Directors of Goodwin PLC and its
subsidiaries, General Managers and Senior Management of the UK subsidiaries. Members of the Audit
Committee are involved in regular discussions with the Directors, General Managers and Senior Management
of each subsidiary where the positions taken on subjective financial matters are discussed. Each overseas
subsidiary is normally visited at least once during the year by a member of the Audit Committee, and / or by a
Main Board Director, for meetings with the General Managers and Senior Management with reports sent back
to the Audit Committee. However, in the current circumstances of flight and self-quarantining restrictions, this
has not been possible since March 2020 but extensive use of Zoom has enabled regular meetings to continue
with our overseas factories. Any areas where the Audit Committee feels that the positions taken within any
particular subsidiary are either inappropriate or merit further discussion are documented for further discussion
by the Board of Directors of Goodwin PLC.
For the half year Interim Report, the Audit Committee reviews the financial and non-financial content, including
the Chairman’s Statement, and reviews the financial statements and qualitative notes of the financial statements,
to help ensure that they are balanced, relevant, appropriately compliant with relevant accounting standards/
legislation, and are consistent and complete. The Audit Committee reports to the Board of Directors their views
as to whether the half year Interim Report, taken as a whole, is fair, balanced and understandable and provides
the information necessary for shareholders to assess the Group’s half year performance. The figures in the half
year Interim Report are not audited, but the external auditor is given sight of these before publication.
For the full year Annual Report, the Audit Committee reviews the financial and non-financial content of the Group
Strategic Report, including the Chairman’s Statement; the Corporate Governance Report; the Directors’ Report;
the Directors’ Remuneration Policy and Report; and reviews the financial statements and the qualitative notes
to the financial statements to examine whether the content is balanced, relevant, appropriately compliant with
relevant accounting standards / legislation, and are consistent and complete. The Audit Committee has discussed
the full year Annual Report and their views with the Group external auditor. The Audit Committee confirmed
to the Board that in its opinion the proposed Annual Report for the year ended 30th April, 2021 appropriately
represents the Group’s trading position and, taken as a whole, is fair, balanced and understandable and provides
the information necessary for shareholders to assess the Group’s full year performance, its position at the year
end, and its objectives, strategy and business model.
2. Helping to ensure the Group carries effective and relevant financial and non-financial internal
controls and financial risk management systems:
To assess the effectiveness of systems for internal financial controls, financial reporting and financial risk
management, the Audit Committee reviews reports from Main Board Directors on the Group’s subsidiaries;
reviews reports from the Group Chief Accountant; reviews reports from General Managers of the Group’s
subsidiaries; reviews quarterly financial reports; reviews reports from internal and external audit; requests
and reviews reports from independent external consultants; and reviews the Group’s risk register, business
continuity programmes and levels of insurance.
22
DIRECTORS’ REPORTS
AUDIT COMMITTEE REPORT (continued)
2021 Audit Committee Risk Programme
The terms of reference for the Audit Committee and how it discharges its duties have been presented to the
Board and ratified.
Risk Management:
As a method of adding formality to the management of risk within all Group companies, Steven Birks, a former
Goodwin PLC Director, continues to mentor each subsidiary in enhancing their risk analysis and controls, and
reports to the Audit Committee on this task. Having focussed initially on overseas companies, all subsidiaries
in the Group are now included in the mentoring and areas being scrutinised in detail, other than risks individual
to each company, are:
a) having appropriate limits of contract liability
b) having appropriate levels and types of insurance
c) ensuring appropriate control of cash flow
d) ensuring health and safety continues to be given priority and that there is a progressive plan for improvement
e) ensuring product development and life cycles are managed relative to the global market
f) ensuring that the provision of trained and skilled manpower is appropriately matched to the requirements of
each company
g) risk analysis and preventative measures associated with the installation and commissioning of new plant,
modified plant and new processes.
The Audit Committee continues to review the effectiveness of Know Your Customer (KYC), credit insurance,
political risk insurance and contract terms and conditions. Gallagher have recently been appointed as brokers
for the Group’s UK insurance cover. Previously, they had carried out a review of insurance policies in place at
the overseas subsidiaries and it is an ongoing task to consider their comments on any areas of concern.
Market risk
No customer accounts for more than 10% of the annual Group turnover. The country and sector dependency for
the year is shown by the charts on page 9.
Technical risk
The performance of new products issued to market always has a degree of risk until a multi-year track record
has been attained. This statement relates to all Group companies in both the Mechanical and Refractory
Engineering Divisions.
Product failure/contract risk
This has been reviewed and is unchanged from that previously stated.
Financial risk
This has been reviewed and is as stated in previous years with the perceived increased volatility in exchange
rates and the possibility of high foreign exchange hedging costs for forward long-term contracts.
Regulatory compliance
The Audit Committee continues to monitor regulatory compliance, training and competency. The Committee
continues to review the impact on the Group of the Climate Change Act 2008 (2050 Target Amendment)
Order 2019.
Human Resources
The age profile of Senior Managers and perceived skill gaps within each Group company continue to be reviewed
by the Audit Committee. A number of accountancy and business development roles have been filled.
Information Technology
During the year the Audit Committee continued to monitor the risks posed affecting information security and the
steps taken to minimise these. A comprehensive internal audit of the Group’s IT systems was completed during
the year. Some risks have been identified and a plan to address those risks is being devised and implemented.
Capital expenditure
The Audit Committee also reviews and comments to the Board on major capital purchases or company
acquisitions being proposed by the Board of a unit or linked value greater than £2 million. Gross proposed
or actual capital expenditure of all Group companies is also reviewed to help ensure the Board maintain
awareness of how such expenditure will affect the limits agreed to be in place at the time.
The Audit Committee has confirmed its view to the Board that in its opinion, the Group carries relevant internal
controls and risk management systems appropriate to minimise the perceived risks of the Group’s business.
3. The Group’s external auditor
Following shareholder approval at the Annual General Meeting in October 2020, RSM UK Audit LLP (“RSM”)
was appointed as the Group’s Auditor for the year ending 30th April, 2021 and going forward.
23
DIRECTORS’ REPORTS
3. The Group’s external auditor (continued)
AUDIT COMMITTEE REPORT (continued)
RSM did not provide any non-audit services to the Group during the year. The Company has, for many years
now, used a different accountancy practice to that of the statutory auditor for its UK tax services, which further
enhances both objectivity and independence.
The Audit Committee has met formally with the Group’s external auditor, RSM, to discuss the full year Annual
Report, and has met with and discussed matters with them as part of the audit process during the current
financial year being reported on. No material concerns were raised during these meetings or discussions.
The Audit Committee was satisfied with the external auditor’s independence and the effectiveness of the
audit process.
The Audit Committee has recommended to the Board to propose a Resolution to confirm the re-appointment
of RSM UK Audit LLP, as the external auditor at the Annual General Meeting on 6th October, 2021.
4. Reviewing comments and feedback
There is regular contact with Directors and employees where open and frank discussion is encouraged.
5. Whistle-blowing Procedures
The Group has a whistle-blowing policy in place whereby employees can report any suspected misconduct or
concerns, either anonymously on a dedicated telephone line, or to the Chairman, the Company Secretary or the
Chair of the Audit Committee. Such calls are investigated and are reported to the Audit Committee. The Audit
Committee has confirmed to the Board that the Group’s whistle-blowing policy and procedures are appropriate.
6. Internal Audit
The scope of internal audit has been set by the Audit Committee and the results reviewed.
The internal audit function operates a random rotation policy which prioritises based on materiality and
endeavours to cover all Group subsidiaries at least once within a three year cycle either via the Group Internal
Auditor or by the respective Group Managing Directors or members of the Audit Committee. Due to Covid-19,
internal audits of our overseas subsidiaries have been and are frustrated, but the larger profit earning
overseas subsidiaries, Noreva, Gold Star Powders India, Goodwin Pumps India, and Goodwin Submersible
Pumps Africa, have been subject to full statutory audit by RSM Germany, India and South Africa respectively.
7. Covid-19
The Audit Committee has continued to review the likely effects of Covid-19 along with the Board as detailed in
the Principal Risks and Uncertainties section on page 12.
8. Accounting estimates and judgements relating to the Financial Statements
The Audit Committee reviewed what it considered to be the accounting estimates and judgement areas
within the Group Annual Report for the year ended 30th April, 2021.
The Audit Committee also took account of the findings of RSM in relation to their external audit work for
the year.
J. E. Kelly
Chair of the Audit Committee
11th August, 2021
24
DIRECTORS’ REPORTS
DIRECTORS’ REMUNERATION POLICY AND REPORT
This report includes the Group’s Remuneration Policy for Directors and sets out the Annual Directors’ Remuneration
Report.
Group’s Remuneration Policy for Directors
The Group’s policy in respect of Directors’ remuneration is to provide individual packages which are determined
having due regard to the Group’s current and projected profitability, the employee’s specific areas of responsibility
and performance, their related knowledge and experience in the Group’s specific fields of operation, the external
labour market and their personal circumstances whereby a package to remunerate and motivate the individual so
as to best serve the Group is set. Individual salaries are also indirectly linked up and down to the time allocated and
perceived effort by the Director to the Group’s business. Many Directors, as indeed employees, put in hours of work
way beyond what could be requested and such personal devotion to duty by a Director is rewarded without
formulae. All Board members have access to independent advice when considered appropriate. In forming its
policy, consideration has been given to the UK Corporate Governance Code best practice provisions on remuneration
policy, service contracts and compensation and has considered the remuneration levels of Directors of comparative
companies.
The remuneration policy for other employees is broadly based on principles consistent with the policy for
Directors. Salary reviews take into account Group performance as well as subsidiary performance, local pay and
market conditions.
Whilst being aware of the requirements to show in graph form the breakdown of base pay, bonus pay, pension and
long-term benefits, the Group is unable to comply with this requirement as Directors are not paid in accordance
with any specific performance criteria or KPIs. Directors are paid based on their level of activity within the Group,
their knowledge and experience of the Group’s activities or similar, the performance of the Group versus market
opportunity whilst also considering the Director’s personal circumstances and the salary needed to ensure
continuity of employment. This in itself may result in decreases or increases in Director salary within any year as
illustrated in the matrix below.
Operation
Maximum
Reviewed
annually at the
anniversary of the
previous salary
adjustment for
the individual
Director.
Generally in line
with inflation and
the wage/salary
increase awarded
to employees, but
this is not rigid.
Performance
Targets
The Group’s
performance,
good or bad, may
result in the salary
being changed.
Changes for
2020/2021
Directors set the
base increase in
salaries. For the
period May 2020
to April 2021 the
increase was
generally 2.4%.
60% of salary.
Following review
of the half year
and year end
results of the
Company.
Element of
Pay
Salary
Purpose and
Link to Strategy
Reflects the Directors’
level of activity and
achievement within
the Group, their
knowledge and
experience of the
Company’s activities
or similar, the
performance of the
Group versus market
opportunity, whilst
also considering the
salary needed to
ensure continuity of
employment.
No bonus strategy or
incentive is agreed or
contractual with any
Director. Should any
be awarded, it is
discretionary and
generally between 0%
and 25%, but with a
maximum of 60%,
as determined by the
Managing Directors
and audited by the
Chairman.
25
DIRECTORS’ REPORTS
DIRECTORS’ REMUNERATION POLICY AND REPORT (continued)
Group’s Remuneration Policy for Directors (continued)
Element of
Pay
Purpose and
Link to Strategy
Operation
Maximum
Performance
Targets
Changes for
2019/2020
Pensions
Other benefits
All Executive Directors
have 3% added to their
gross remuneration
which, by nature of
salary sacrifice, is put
into a pension
scheme where they
have direct dealings
with the selected
investment fund
provider.
Fully expensed car or
cash alternative,
health insurance or
other services.
Monthly
payments
Currently 3%
of gross
remuneration
N/A
N/A
N/A
N/A
No changes.
This policy
was adopted
in October 2013
for the Directors
and entire UK
workforce.
See details of the
Directors’
emoluments on
pages 29 and 30.
We believe the above meets the requirement of Schedule 8, Companies Act 2006, regarding the changes in 2020 /
2021. The Policy and Report is signed by the Chairman and the Managing Directors.
In any company there are specific individual circumstances that on occasions will merit special treatment in a given
year for a Director either to keep or look after the person, indeed no different than we may do for an employee.
In the matrix of remuneration for Directors you will note the Company has given itself flexibility to deal with
specific circumstances which may not even be able to be made public for confidentiality reasons of which there
are many. However, bearing in mind the performance of the Company over the past twenty years and more and
that the Directors’ salaries are anything but excessive versus the norm of other PLCs, this is the Board’s policy.
Total shareholder return – unaudited
For reference the TSR of Goodwin PLC versus the FTSE 100 and the FTSE 350 is shown below for not only the last
five but also the last ten years and the last twenty years.
TSR for last 5 Years … … …
TSR for last 10 Years … … …
TSR for last 20 Years … … …
Goodwin
63.1%
170.3%
6,211.0%
FTSE 100
35.9%
68.2%
141.7%
FTSE 350
38.7%
78.5%
175.44%
As is required by the Listing Rules, we show in graph form both the salary of the Managing Directors of Goodwin
PLC and the TSR over the past ten years. We, however, do not list out the salary of the Financial Director of
Goodwin PLC versus the TSR as in Goodwin PLC we have a Group Chief Accountant (J. Connolly) who carries out
75% of the duties of a Financial Director and who is also a Director of Goodwin PLC, but we do not have what
would generally be known as a Financial Director. This is for the reason that certain decisions that outsiders might
consider are the sole responsibility of the Financial Director are not. In Goodwin PLC it is a team effort and such
decisions are made not only by the Group Chief Accountant but also by the Managing Directors and the Chairman.
The Company put the Remuneration Policy to the vote of the Annual General Meeting in 2019 when it was passed
by 93.68% of those who voted. The Company will be putting the Remuneration Policy to the vote again in 2022,
which is three years from the last vote, as is required by the Listing Rules.
For confidentiality and flexibility reasons, the Board policy is not to disclose exit/termination payments to
Directors but the policy is to remain within the law, to fairly compensate good leavers and minimise payments to
bad leavers. In the last ten years, the Company has managed to avoid paying any termination payments to bad
leavers. It is, however, Board policy to limit termination payments to a maximum of 100% of gross annual salary
and should such amount be exceeded then it will be reported in the Annual Report giving the reason why.
The Company takes seriously its responsibility for ensuring a fair deal between employees, shareholders, customers
and the local community and maintaining an appropriate balance.
The Company does not use or pay any external advisors or consultants for remuneration or incentive policy.
Shareholder engagement is by nature of the Annual Report, the Annual General Meeting and the votes therein.
26
DIRECTORS’ REPORTS
DIRECTORS REMUNERATION POLICY AND REPORT (continued)
Annual Directors’ Remuneration Report
This report is submitted in accordance with the Directors’ Remuneration Report Regulations.
Consideration by the Directors of matters relating to Directors’ remuneration
The Company’s Remuneration Policy for Directors is set by the Board as a whole and is described in pages 25 to 26.
The Policy has been followed in the financial year to 30th April, 2021 and will be followed in the next financial year.
The Board of Directors are also the key management personnel as defined in IAS 24.
Service contracts
None of the Directors has a service contract. A Director may resign at any time by notice in writing to the Board.
There are no set minimum notice periods but all Directors other than the Chairman and Managing Directors
are subject to retirement by rotation and as employees also have notice periods in accordance with law.
No compensation as of right is payable to Directors on leaving office.
Relative importance of spend on pay
The table below shows shareholder distributions and total employee expenditure, and the percentage change in both:
Ordinary dividends proposed in respect of the year … … … … …
Total employee costs
Average employee numbers … … … … … … … … …
2021
£’000
7,862
… … … … … … … … … 44,873
1,129
2020
£’000
6,016
44,241
1,190
%
31%
1%
(5)%
Approval of the Company’s Annual Directors’ Remuneration Report
An ordinary resolution for the approval of the Annual Directors’ Remuneration Report will be put to shareholders
at the forthcoming Annual General Meeting. The Annual Directors’ Remuneration Report presented in the accounts
to 30th April, 2020 was put to the shareholders at last year’s Annual General Meeting on 7th October, 2020. The
Annual Directors’ Remuneration Report was accepted with 99.26% of proxy votes cast in favour.
Total shareholder return – unaudited
The following graphs compare the Group’s total shareholder return over the ten and twenty years ended
30th April, 2021 with various FTSE indices. The graphs also show the change in the earnings of the previous
Managing Director for the periods up to 30th April, 2019.
The base earnings figure used in the graphs for 30th April, 2020 and 30th April, 2021 is the amount earned by
each Managing Director.
2017
£’000
2018
£’000
2019
£’000
2020
£’000
2021
£’000
368
385
397
310
355
Total payroll costs, excluding the Managing Director’s salary, have increased by 1%. During the year, the base
increase awarded to employees in the UK companies was 2.4%. However, as a result of Covid-19, the total
payroll costs disclosed in note 6 are impacted by a 5% reduction in overall employee numbers.
The following graphs have not been audited.
27
DIRECTORS’ REPORTS
DIRECTORS REMUNERATION POLICY AND REPORT (continued)
Annual Directors’ Remuneration Report (continued)
Total Shareholder Return (TSR)
10 Years ended 30th April 2021
250
200
150
100
50
0
e
g
n
a
h
C
%
e
v
i
t
a
l
u
m
u
C
-50
April 2011
April 2012
April 2013
April 2014
April 2015
April 2016
April 2017
April 2018
April 2019
April 2020
April 2021
Total Shareholder Return (TSR)
20 Years ended 30th April 2021
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
e
g
n
a
h
C
%
e
v
i
t
a
l
u
m
u
C
0
April 2001
April 2003
April 2005
April 2007
April 2009
April 2011
April 2013
April 2015
April 2017
April 2019
April 2021
Goodwin
FTSE 100
FTSE 350
Small Cap
Ind & Eng
MD Earnings
Goodwin
FTSE 100
FTSE 350
Small Cap
Ind & Eng
MD Earnings
The increase in the Goodwin PLC share price since 2001 plus dividends re-invested would mean that £1.00 invested
in 2001 by the 30th April, 2021 would be worth £63.11. The increase in the share price since 2011 plus dividends
re-invested would mean that £1.00 invested in 2011 would at 30th April, 2021 be worth £2.70.
28
DIRECTORS’ REPORTS
DIRECTORS REMUNERATION POLICY AND REPORT (continued)
Annual Directors’ Remuneration Report (continued)
The auditors are required to report on the following information contained in this section of the Annual Directors’
Remuneration Report.
Directors’ interests in the share capital of the Company as well as Audit Committee members /
ex Directors – audited
The interests of the Directors in the share capital of the Company at the beginning and end of the financial year
were as follows:
Number of 10p ordinary shares
30th April
30th April
2020
2021
Beneficial
M. S. Goodwin … … … … …
S. R. Goodwin … … … … …
T. J . W. Goodwin… … … … …
J. Connolly
… … … … …
S. C. Birks (retired 11th December, 2020) …
B. R. E. Goodwin … … … … …
N. Brown (appointed 11th December, 2020)
J. W. Goodwin* … … … … …
R. S. Goodwin* … … … … …
J. W. Goodwin and R.S. Goodwin* … …
J. W. Goodwin and R.S. Goodwin* … …
…
…
…
…
…
…
…
…
…
…
…
67,072
76,785
120,141
18,322
11,300
55,239
445
61,386
22,756
2,129,153
1,424,210
64,034
82,247
112,868
7,622
200
42,501
-
40,986
11,656
2,129,153
1,393,592
Non-beneficial
J. W. Goodwin* and E. M. Goodwin
…
…
14,166
14,166
* Audit committee member / ex Director.
On 28th May, 2021 the last tranche of share options were granted and exercised under the Equity Long-Term
Incentive Plan and the following Executive Directors received 20,400 shares each on the 4th June, 2021.
Details of the total shares held on 11th August, 2021 are:
Mr. M.S. Goodwin 87,472
Mr. S.R. Goodwin 97,185
Mr. T.J.W. Goodwin 140,541
Mr. J. Connolly 38,722
Mr. B.R.E. Goodwin 75,639
There have been no other changes in the Directors’ interests between 30th April, 2021 and 11th August, 2021.
Details of individual emoluments and compensation – audited
The following parts of the Remuneration Report are subject to audit.
Single Total Figure Table
Year ended 30th April, 2021
Salary
M. S. Goodwin … … … … … … …
S. R. Goodwin … … … … … … …
T. J. W. Goodwin … … … … … … …
J. Connolly… … … … … … … …
S. C. Birks (retired 11th December, 2020) … …
B. R. E. Goodwin … … … … … … …
N. Brown (appointed 11th December, 2020) … …
J. E. Kelly … … … … … … … …
2021
£’000
333
333
243
256
64
209
64
-
Benefits
Non-Exec
in kind Director’s
fees
2021
£‘000
-
-
-
-
-
-
-
68
2021
£’000
12
12
6
17
13
6
4
-
Pension
contrib-
utions
2021
£’000
10
10
7
8
2
6
2
-
Total
2021
£’000
355
355
256
281
79
221
70
68
Total … … … … … … … … 1,502
70
68
45
1,685
29
DIRECTORS’ REPORTS
DIRECTORS REMUNERATION POLICY AND REPORT (continued)
Annual Directors’ Remuneration Report (continued)
Single Total Figure Table
Year ended 30th April, 2020
Salary
Benefits
in kind
M. S. Goodwin … … … … … … …
S. R. Goodwin … … … … … … …
T. J. W. Goodwin … … … … … … …
J. Connolly … … … … … … … …
S. C. Birks … … … … … … … …
B. R. E. Goodwin … … … … … … …
J. E. Kelly … … … … … … … …
2020
£’000
275
275
177
199
117
140
-
Total
… … … … … … … …
1,183
2020
£’000
25
25
11
36
25
11
-
133
Non-Exec
Director’s
fees
2020
£’000
-
-
-
-
-
-
63
Pension
contrib-
utions
2020
£’000
10
10
6
6
4
5
-
Total
total
2020
£’000
310
310
194
241
146
156
63
63
41
1,420
Benefits in kind consist of the provision of a fully expensed car, a cash alternative scheme, healthcare insurance
or other services. The employer’s national insurance costs relating to the Directors’ remuneration amounted to
£207,000 (2020: £165,000).
Pay Comparison – audited
For the first time this year in accordance with the new remuneration regulations, we are including in the report a table
comparing the annual change of each directors pay with that of the average employee’s pay. This is required over a
rolling five year period, but as the requirements came into effect for financial years ending 2021, the table below will
only show the comparison from 30th April, 2020.
Annual Percentage Change of Average Remuneration of each Director
M. S. Goodwin … … … … … … … …
S. R. Goodwin … … … … … … … …
T. J. W. Goodwin … … … … … … … …
J. Connolly … … … … … … … … …
S. C. Birks … … … … … … … … …
B. R. E. Goodwin … … … … … … … …
N. Brown … … … … … … … … …
J. E. Kelly … … … … … … … … …
… … … …
UK Average Employee % Change*
…
…
…
…
…
…
…
…
…
2020 - 2021
£’000
15%
15%
32%
16%
N/A
42%
N/A
9%
3%
…
…
…
…
…
…
…
…
…
Notes:
The UK average employee is based on the UK workforce employed by Goodwin PLC as a company and its UK
subsidiaries. The average figure has been calculated using a mean 3% of employee pay.
The increases greater than the UK average employee percentage change are a reflection of the further development
of individual directors in the areas of their new responsibilities.
Pay Ratio of Managing Directors
In accordance with the Pay Ratio Regulations we are disclosing the comparison of our Managing Directors’ pay with
that of our average UK employees. It is appropriate that the Managing Directors’ pay was used in the comparison
as we do not have what is generally known as a Chief Executive Officer.
For the year ended 30th April, 2021 the pay for both the Managing Directors in the Single Total Pay Figure table is
the same. If the figures are different in any subsequent year, the higher of the two figures will be used in the ratio
pay comparison section.
The tables overleaf show our Managing Directors’ pay ratio at the 25th, median and 75th percentile of our UK
employees since 30th April, 2020:
30
DIRECTORS REMUNERATION POLICY AND REPORT (continued)
Annual Directors’ Remuneration Report (continued)
Pay Ratio of Managing Directors (continued)
DIRECTORS’ REPORTS
Financial
Year
2021 ratios
2020 ratios
FTSE SmallCap
FTSE 250
Financial
Year
Method
Option A
Option A
25th
percentile
pay ratio
Median
pay ratio
75th
percentile
pay ratio
14:1
12:1
17:1
22:1
11:1
10:1
27:1
32:1
8:1
7:1
35:1
61:1
Managing
Directors
£’000
25th
percentile
pay
£’000
Median
pay
£’000
75th
percentile
pay
£’000
2021 Total Pay
2020 Total Pay
355
333
26
26
33
33
45
45
Notes:
1. Total pay has been calculated for each employee and, where applicable, prorated to calculate full-time
equivalent pay. It includes payments that are taxable plus any employer pension contributions.
2. We offer competitive and fair rates of pay for all our UK employees taking into account personal circumstances.
3. We have opted for Option A of the pay ratio regulations as this is the preferred option under the regulations
and also provides the most accurate data.
4. The above figures are based on the total pay as at 30th April, 2021.
Equity Long-Term Incentive Plan (LTIP) – Vested Share Options – audited
Under the Long-Term Incentive Plan (LTIP) for the Executive Directors, that was approved at the Annual General
Meeting on 5th October, 2016, the 2016 LTIP target was partially met in 2019, resulting in 85% of the awards granted
vesting, entitling each of the sitting eight Directors to 61,200 shares (17 x 3,600 = 61,200).
Exercised
During the year ended 30th April, 2021 each Director exercised 20,400 share options, increasing the Company’s
total share capital by 163,200 to 7,526,400.
The aggregate share options remaining to be exercised as at 30th April, 2021 amounted to 163,200. These were
exercised on 28th May, 2021, increasing the share capital by 163,200 to 7,689,600.
Whilst the Company has no follow-on LTIP incentive plans in place or proposed, the shares vested as part of the
above scheme further align the Executive Directors with the long-term interests of the shareholders, as do their
not insignificant shareholdings already held.
Total pension entitlements – unaudited
In line with the Government’s requirements the Group administers a pension scheme for all UK employees
including Directors. Under this Auto Enrolment Pension arrangement each Director has an amount of 3% of gross
remuneration paid into a pension scheme where they have direct dealings with the selected investment fund
provider. The employee also contributes a minimum of 4% of remuneration to his / her fund. The pension
contributions are to defined contribution pension schemes which are independent of the Company.
The Company has no obligations to make any payments in relation to pensions when a Director leaves service by
nature of removal from office, resignation or retirement.
The Annual Directors’ Remuneration Report was approved by the Board on 11th August, 2021 and is signed on
its behalf by:
T. J. W. Goodwin
Director
M. S. Goodwin
Director
S. R. Goodwin
Director
31
DIRECTORS’ REPORTS
STATEMENT OF DIRECTORS’ RESPONSIBILITIES IN RESPECT OF THE
ANNUAL REPORT AND THE FINANCIAL STATEMENTS
The Directors are responsible for preparing the Annual Report and the Group and parent Company financial
statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and parent Company financial statements for each financial
year. Under that law they are required to prepare the Group financial statements in accordance with international
accounting standards in conformity with the requirements of the Companies Act 2006 and are additionally required,
under the Listing Rules of the Financial Conduct Authority, to prepare the group financial statements in accordance
with international financial reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in
the European Union. The Directors have elected under company law to prepare the parent Company financial
statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom
Accounting Standards and applicable law).
Under company law the Directors must not approve the financial statements unless they are satisfied that they give
a true and fair view of the state of affairs of the Group and parent Company and of their profit or loss for that period.
In preparing each of the Group and parent Company financial statements, the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable, relevant, reliable and prudent;
• for the Group financial statements, state whether they have been prepared in accordance with international
accounting standards in conformity with the requirements of the Companies Act 2006 and international financial
reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union
• for the parent Company financial statements, state whether applicable UK Accounting Standards have been
followed, subject to any material departures disclosed and explained in the parent Company financial statements;
• assess the Group and parent Company’s ability to continue as a going concern, disclosing, as applicable, matters
related to going concern; and
• use the going concern basis of accounting unless they either intend to liquidate the Group or the parent Company
or to cease operations, or have no realistic alternative but to do so.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain
the Group and parent Company’s transactions and disclose with reasonable accuracy at any time the financial
position of the Group and parent Company and enable them to ensure that its financial statements comply with
the Companies Act 2006. They are responsible for such internal control as they determine is necessary to enable
the preparation of financial statements that are free from material misstatement, whether due to fraud or error,
and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of
the Group and parent Company and to prevent and detect fraud and other irregularities.
Under applicable law and regulations, the Directors are also responsible for preparing a Strategic Report, Directors’
Report, Directors’ Remuneration Report and Corporate Governance Statement that complies with that law and
those regulations.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included
on the Company’s website. Legislation in the UK governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
Responsibility statement of the Directors in respect of the Directors’ Report and Accounts
We confirm that to the best of our knowledge:
• the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and
fair view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings
included in the consolidation taken as a whole; and
• the Group Strategic Report includes a fair review of the development and performance of the business and the
position of the Issuer and the undertakings included in the consolidation taken as a whole, together with a
description of the principal risks and uncertainties that they face.
We consider the Directors Report and Accounts, taken as a whole, is fair, balanced and understandable and
provides the information necessary for shareholders to assess the Group’s position and performance, business
model and strategy.
T. J. W. Goodwin
Director
M. S. Goodwin
Director
S. R. Goodwin
Director
32
11th August, 2021
INDEPENDENT AUDITOR’S REPORT
to the members of Goodwin PLC
'
'
'
'
'
'
'
'
'
'
*678798'
!"#$%&"#%'()*"(#*$"#+),%,-)%.#/*%*"0",*/#1+#211(3),#456#7*$"#89%:",*#6109%,;<=#%,(#)*/#/'>/)()%:)"/#
7*$"#82:1'9<=#+1:#*$"#;"%:#",("(#?@#A9:).#B@BC#3$)-$#-109:)/"#*$"#61,/1.)(%*"(#D*%*"0",*#1+#4:1+)*#1:#
51//E# 61,/1.)(%*"(# D*%*"0",*# 1+# 6109:"$",/)&"# F,-10"E# 61,/1.)(%*"(# D*%*"0",*# 1+# 6$%,G"/# ),#
HI')*;E#61,/1.)(%*"(#J%.%,-"#D$""*E#61,/1.)(%*"(#D*%*"0",*#1+#6%/$#K.13/E#6109%,;#J%.%,-"#D$""*E#
6109%,;#D*%*"0",*#1+#6$%,G"/#),#HI')*;#%,(#,1*"/#*1#*$"#+),%,-)%.#/*%*"0",*/E#),-.'(),G#/)G,)+)-%,*#
%--1',*),G#91.)-)"/L#M$"#+),%,-)%.#:"91:*),G#+:%0"31:N#*$%*#$%/#>"",#%99.)"(#),#*$"#9:"9%:%*)1,#1+#*$"#
2:1'9#+),%,-)%.#/*%*"0",*/#)/#%99.)-%>."#.%3#%,(#F,*":,%*)1,%.#A--1',*),G#D*%,(%:(/#),#-1,+1:0)*;#3)*$#
*$"#:"I'):"0",*/#1+#*$"#6109%,)"/#A-*#B@@O#%,(#),*":,%*)1,%.#+),%,-)%.#:"91:*),G#/*%,(%:(/#%(19*"(#
9':/'%,*#*1#P"G'.%*)1,#7H6=#Q1#CO@ORB@@B#%/#)*#%99.)"/#),#*$"#H':19"%,#S,)1,L#M$"#+),%,-)%.#:"91:*),G#
+:%0"31:N# *$%*# $%/# >"",# %99.)"(# ),# *$"# 9:"9%:%*)1,# 1+# *$"# 9%:",*# 6109%,;# +),%,-)%.# /*%*"0",*/# )/#
%99.)-%>."# .%3# %,(# S,)*"(# T),G(10# A--1',*),G# D*%,(%:(/# ),-.'(),G# KPD# C@C# UP"('-"(# V)/-.1/':"#
K:%0"31:NW#7S,)*"(#T),G(10#2",":%..;#A--"9*"(#A--1',*),G#4:%-*)-"=L#
#
F,#1':#19),)1,X##
•
#
•
#
•
#
•
#
*$"#+),%,-)%.#/*%*"0",*/#G)&"#%#*:'"#%,(#+%):#&)"3#1+#*$"#/*%*"#1+#*$"#2:1'9"",#9:19":.;#9:"9%:"(#),#%--1:(%,-"#3)*$#F,*":,%*)1,%.#
A--1',*),G#D*%,(%:(/#),#-1,+1:0)*;#3)*$#*$"#:"I'):"0",*/#1+#*$"#6109%,)"/#A-*#B@@O#%,(#
),*":,%*)1,%.#+),%,-)%.#:"91:*),G#/*%,(%:(/#%(19*"(#9':/'%,*#*1#P"G'.%*)1,#7H6=#Q1#CO@ORB@@B#
%/#)*#%99.)"/#),#*$"#H':19"%,#S,)1,Y#
*$"#9%:",*#6109%,;#+),%,-)%.#/*%*"0",*/#$%&"#>"",#9:19":.;#9:"9%:"(#),#%--1:(%,-"#3)*$#
S,)*"(#T),G(10#2",":%..;#A--"9*"(#A--1',*),G#4:%-*)-"Y#%,(#
*$"#+),%,-)%.#/*%*"0",*/#$%&"#>"",#9:"9%:"(#),#%--1:(%,-"#3)*$#*$"#:"I'):"0",*/#1+#*$"#
6109%,)"/#A-*#B@@O#%,(E#%/#:"G%:(/#*$"#2:1'9#+),%,-)%.#/*%*"0",*/E#A:*)-."#Z#1+#*$"#FAD#
:"G'.%*)1,/L#
'
0:;7;'<9='9678798'
!"#-1,('-*"(#1':#%'()*#),#%--1:(%,-"#3)*$#F,*":,%*)1,%.#D*%,(%:(/#1,#A'()*),G#7ST=#7FDA/#7ST==#%,(#
%99.)-%>."# .%3L# [':# :"/91,/)>).)*)"/# ',(":# *$1/"# /*%,(%:(/# %:"# +':*$":# ("/-:)>"(# ),# *$"# A'()*1:).)*)"/#+1:#*$"#%'()*#1+#*$"#+),%,-)%.#/*%*"0",*/#/"-*)1,#1+#1':#:"91:*L#!"#%:"#),("9",(",*#1+#*$"#
2:1'9#%,(#9%:",*#6109%,;#),#%--1:(%,-"#3)*$#*$"#"*$)-%.#:"I'):"0",*/#*$%*#%:"#:"."&%,*#*1#1':#%'()*#
1+#*$"#+),%,-)%.#/*%*"0",*/#),#*$"#STE#),-.'(),G#*$"#KP6.)-#
),*":"/*# ",*)*)"/# %,(# 3"# $%&"# +'.+).."(# 1':# 1*$":# "*$)-%.# :"/91,/)>).)*)"/# ),# %--1:(%,-"# 3)*$# *$"/"#
:"I'):"0",*/L# !"# >".)"&"# *$%*# *$"# %'()*# "&)(",-"# 3"# $%&"# 1>*%),"(# )/# /'++)-)",*# %,(# %99:19:)%*"# *1#
9:1&)("#%#>%/)/#+1:#1':#19),)1,L#
#
!
598>?@;798;'=A?:B78C'B9'C978C'>98>A=8
F,#%'()*),G#*$"#+),%,-)%.#/*%*"0",*/E#3"#$%&"#-1,-.'("(#*$%*#*$"#():"-*1:/<#'/"#1+#*$"#G1),G#-1,-":,#
>%/)/#1+#%--1',*),G#),#*$"#9:"9%:%*)1,#1+#*$"#+),%,-)%.#/*%*"0",*/#)/#%99:19:)%*"L#[':#"&%.'%*)1,#1+#*$"#
():"-*1:/<# %//"//0",*# 1+# *$"# 2:1'9).)*;# *1# -1,*),'"# *1# %(19*# *$"# G1),G#
-1,-":,#>%/)/#1+#%--1',*),G#),-.'("(X#
•
# P"&)"3#1+#0%,%G"0",*1%:(#9%9":#3$)-$#/"*#1'*#*$"#G1),G#-1,-":,#>%/)/E#N";#
•
•
•
•
+1:"-%/*),G#%//'09*)1,/E#/",/)*)&)*)"/#%,(#-1,-.'/)1,Y#
# [>*%),"(#-19)"/#1+#0%,%G"0",*'(G"*#:"&)"3#9:1-"//E#),-.'(),G#
/'>0)//)1,/#+:10#*$"#ST#%,(#1&":/"%/#>'/),"//"/#3$)-$#%:"#%99:1&"(#>;#*$"#>1%:(Y#
# A//"//0",*#1+#*$"#+1:"-%/*/#*1#$)/*1:)-%.#*:%(),G#:"/'.*/#%,(#*$"#N";#%//'09*)1,/#+1:#
"\9"-*"(#G:13*$E#0%:G),#)09:1&"0",*#%,(#-%9)*%.#"\9",()*':"#9.%,/Y#
# S,(":*%N),G#1':#13,#/*:"//#*"/*#*1#-1,/)(":#-):-'0/*%,-"/#',(":#3$)-$#$"%(:110#31'.(#>"#
":1("(Y#
33
•
# ]":)+;),G#*$"#-100)**"(#+',(),G#%&%).%>."#*1#*$"#2:1'9#%,(#9%:",*#6109%,;#+1:#*$"#+1:"-%/*#
9":)1(#%,(#*$"#$"%(:110#*$)/#9:1&)("(#*1#*$"#2:1'9#%,(#9%:",*#6109%,;L#
#
J%/"(#1,#*$"#31:N#3"#$%&"#9":+1:0"(E#3"#$%&"#,1*#)(",*)+)"(#%,;#0%*":)%.#',-":*%),*)"/#:".%*),G#*1#
"&",*/#1:#-1,()*)1,/#*$%*E#),()&)('%..;#1:#-1.."-*)&".;E#0%;#-%/*#/)G,)+)-%,*#(1'>*#1,#*$"#2:1'9).)*;#*1#-1,*),'"#%/#%#G1),G#-1,-":,#+1:#%#9":)1(#1+#%*#."%/*#*3".&"#01,*$/#+:10#
3$",#*$"#+),%,-)%.#/*%*"0",*/#%:"#%'*$1:)/"(#+1:#)//'"L#
#
F,#:".%*)1,#*1#*$"#",*)*)"/#:"91:*),G#1,#$13#*$";#$%&"#%99.)"(#*$"#ST#61:91:%*"#21&":,%,-"#61("E#3"#
$%&"#,1*$),G#0%*":)%.#*1#%((#1:#(:%3#%**",*)1,#*1#),#:".%*)1,#*1#*$"#():"-*1:/<#/*%*"0",*#),#*$"#+),%,-)%.#
/*%*"0",*/#%>1'*#3$"*$":#*$"#():"-*1:/#-1,/)(":"(#)*#%99:19:)%*"#*1#%(19*#*$"#G1),G#-1,-":,#>%/)/#1+#
%--1',*),GL#
#
[':#:"/91,/)>).)*)"/#%,(#*$"#:"/91,/)>).)*)"/#1+#*$"#():"-*1:/#3)*$#:"/9"-*#*1#G1),G#-1,-":,#%:"#("/-:)>"(#
),#*$"#:"."&%,*#/"-*)1,/#1+#*$)/#:"91:*L#
'
-@DD:=E'9<'9@=':@F7B':66=9:>G'
HAE':@F7B'D:BBA=;'
•
2=9@6'
#P"&",'"#:"-1G,)*)1,#^#:"&",'"#:"-1G,)/"(#1&":#*)0"#
•
#P"&",'"#:"-1G,)*)1,#^#:"&",'"#:"-1G,)/"(#%*#%#91),*#),#*)0"#
•
#F,*%,G)>."#%//"*/#^#-%9)*%.)/%*)1,#%,(#)09%):0",*#
•
#F,&",*1:;#&%.'%*)1,#
•
%:=A8B'59D6:8E'
#6%::;),G#&%.'"#1+#),&"/*0",*/#),#/'>/)()%:)"/#%,(#),*":-109%,;#
:"-")&%>."/#
/:BA=7:?7BE'
•
2=9@6'
# [&":%..#0%*":)%.)*;X#_O`CE@@@#
•
# 4":+1:0%,-"#0%*":)%.)*;X#_Z`OE@@@##
->96A'
•
%:=A8B'59D6:8E'
# [&":%..#0%*":)%.)*;X#_`@@E@@@#
•
# 4":+1:0%,-"#0%*":)%.)*;X#_?`@E@@@##
[':#%'()*#9:1-"(':"/#-1&":"(#a@b#1+#:"&",'"E#a`b#1+#*1*%.#%//"*/#%,(#
a?b#1+#9:1+)*#>"+1:"#*%\L#
'
HAE':@F7B'D:BBA=;'
T";#%'()*#0%**":/#%:"#*$1/"#0%**":/#*$%*E#),#1':#9:1+"//)1,%.#c'(G0",*E#3":"#1+#01/*#/)G,)+)-%,-"#),#1':#
%'()*#1+#*$"#2:1'9#%,(#9%:",*#6109%,;#+),%,-)%.#/*%*"0",*/#1+#*$"#-'::",*#9":)1(#%,(#),-.'("#*$"#01/*#
/)G,)+)-%,*#%//"//"(#:)/N/#1+#0%*":)%.#0)//*%*"0",*#73$"*$":#1:#,1*#('"#*1#+:%'(=#3"#)(",*)+)"(E#),-.'(),G#
*$1/"#3$)-$#$%(#*$"#G:"%*"/*#"++"-*#1,#*$"#1&":%..#%'()*#/*:%*"G;E#*$"#%..1-%*)1,#1+#:"/1':-"/#),#*$"#%'()*#
%,(#():"-*),G#*$"#"++1:*/#1+#*$"#",G%G"0",*#*"%0L#M$"/"#0%**":/#3":"#%((:"//"(#),#*$"#-1,*"\*#1+#1':#
%'()*#1+#*$"#2:1'9#%,(#9%:",*#6109%,;#+),%,-)%.#/*%*"0",*/#%/#%#3$1."E#%,(#),#+1:0),G#1':#19),)1,#
*$":"1,E#%,(#3"#(1#,1*#9:1&)("#%#/"9%:%*"#19),)1,#1,#*$"/"#0%**":/L##
#
!"#$%&"#("*":0),"(#*$"#0%**":/#("/-:)>"(#>".13#*1#>"#*$"#N";#%'()*#0%**":/#*1#>"#-100',)-%*"(#),#
1':#:"91:*L#
#
+AIA8@A'=A>9C87B798'J'+AIA8@A'=A>9C87;AF'9IA='B7DA'
HAE':@F7B'D:BBA='
#
FA;>=76B798
P"+":#*1#%--1',*),G#91.)-)"/#),#,1*"#CE#%--1',*),G#"/*)0%*"/#%,(#
c'(G"0",*/#),#,1*"#B#%,(#,1*"#ZL#
#
M$"#2:1'9#$%/#-1,*:%-*/#3)*$#-'/*10":/#',(":#3$)-$#:"&",'"#)/#
:"-1G,)/"(#1&":#*)0"L#
34
H/*)0%*"/#%:"#0%("#>;#0%,%G"0",*#>%/"(#1,#31:N#-109."*"(#+1:#"%-$#
-1,*:%-*#%,(#-1/*/#*1#-109."*"L#
P"&",'"#)/#:"-1G,)/"(#>%/"(#1,#/*%G"#1+#-109."*)1,#3)*$#%,#%//1-)%*"(#
%(c'/*0",*#0%("#*1#-1/*#1+#/%."/#*1#%(c'/*#*$"#."&".#1+#9:1+)*/#:"-1G,)/"(#
1,#*$"#-1,*:%-*#*1#>"#),#.),"#3)*$#*$"#/*%G"#1+#-109."*)1,L#
A//1-)%*"(#-1,*:%-*#%//"*/E#.)%>).)*)"/#%,(#31:N#),#9:1G:"//#%:"#
:"-1G,)/"(#3$":"#%99.)-%>."#1,#*$"/"#-1,*:%-*/L#
P"&",'"#',(":9),/#*$"#N";#0"%/':"/#1+#9":+1:0%,-"#1+#*$"#2:1'9L#
M$":"#)/#%#:)/N#*$%*#:"&",'"#-1'.(#>"#0)//*%*"(#*$:1'G$X#
d ),%99:19:)%*"#%99.)-%*)1,#1+#*$"#2:1'9"",#-109."*"(#),#
*$"#;"%:#%,(#*$1/"#19",#%*#*$"#;"%:#",(L####
!"#-1,/)(":"(#0%,%G"0",*
19",#-1,*:%-*/#%*#*$"#9":)1(#",(E#/'>/*%,*)&".;#*"/*),G#/'991:*),G#
/-$"('."/E#),-.'(),G#&":)+)-%*)1,#1+#-1,*:%-*'%.#*":0/L#!"#-$%..",G"(#
0%,%G"0",*#1,#*$"#N";#%//'09*)1,/#%,(#&%:)%,-"/#)(",*)+)"(L#
!"#)(",*)+)"(#*$%*#:"&",'"#1,#-":*%),#0"-$%,)-%.#",G),"":),G#-1,*:%-*/#)/#
%--1',*"(#+1:#%*#%#91),*#),#*)0"L#!"#-$%..",G"(#0%,%G"0",*).)*)"/R-1,*:%-*#%//"*/#/'991:*"(#*$"#*"/*),G#
',(":*%N",L#
.9K'BGA'D:BBA='K:;'
:FF=A;;AF'78'BGA'
:@F7B'
HAE'9L;A=I:B798;'
[':#%'()*#31:N#),#:"/9"-*#1+#:"&",'"#:"-1G,)/"(#1&":#*)0"#-1,-.'("(#*$%*#
*$"#:"&",'"#)/#,1*#0%*":)%..;#0)//*%*"(#%,(#%//1-)%*"(#()/-.1/':"/#%:"#
%99:19:)%*"L#
[':#31:N#()(#)(",*)+;#/10"#"::1:/#*$%*#3":"#/'>/"I'",*.;#%(c'/*"(#>;#
0%,%G"0",*E#*$"/"#%(c'/*0",*/#()(#,1*#)09%-*#*$"#9:1+)*#:"-1G,)/"(#),#
*$"#+),%,-)%.#/*%*"0",*/L!
+AIA8@A'=A>9C87B798'J'=AIA8@A'=A>9C87;AF':B':'6978B'78'B7DA'
HAE':@F7B'D:BBA='
FA;>=76B798'
P"+":#*1#%--1',*),G#91.)-)"/#),#,1*"#CE#%--1',*),G#"/*)0%*"/#%,(#c'(G"0",*/#
),#,1*"#B#%,(#,1*"#ZL#
P"&",'"#)/#:"-1G,)/"(#%*#%#91),*#),#*)0"#),#*$"#P"+:%-*1:;#()&)/)1,#%,(#+1:#
-":*%),#%::%,G"0",*/#),#*$"#e"-$%,)-%.#()&)/)1,L#
P"&",'"#)/#:"-1G,)/"(#3$",#-1,*:1.#1+#G11(/#)/#9%//"(#1,*1#*$"#-'/*10":#
>;#*$"#2:1'9L#f'(G"0",*#)/#),&1.&"(#),#("*":0),),G#*$"#91),*#%*#3$)-$#
-1,*:1.#9%//"/#+1:#-":*%),#0"-$%,)-%.#",G),"":),G#-1,*:%-*/#3$":"#:"&",'"#
)/#:"-1G,)/"(#1,#(".)&":;#*1#*$"#-'/*10":L#
M$":"#)/#%#:)/N#*$%*#:"&",'"#-1'.(#>"#0)//*%*"(#*$:1'G$X#
d ),%99:19:)%*"#%99.)-%*)1,#1+#*$"#2:1'9),%*)1,#1+#/'>/*%,*)&"#%,%.;*)-%.#:"&)"3#%,(#
*"/*/#1+#("*%).L#
#
!"#/"."-*"(#%#/%09."#1+#)*"0/#*1#-$"-N#*$%*#:"&",'"#3%/#:"-1G,)/"(#1,#
(".)&":;#%,(#*$%*#*$"#-'*d1++#1+#:"&",'"#*:%,/%-*)1,/#%:1',(#*$"#;"%:#",(#3%/#
%99:19:)%*"L#
HAE'9L;A=I:B798;'
M$"#:"/'.*/#1+#1':#9:1-"(':"/#3":"#/%*)/+%-*1:;#
!8B:8C7L?A':;;AB;'J'>:67B:?7;:B798':8F'7D6:7=DA8B'
HAE':@F7B'D:BBA='
#
FA;>=76B798
P"+":#*1#%--1',*),G#91.)-)"/#),#,1*"#CE#%--1',*),G#"/*)0%*"/#%,(#c'(G"0",*/#
),#,1*"#B#%,(#,1*"#C`L#
#
M$"#2:1'9#$%/#&%:)1'/#),*%,G)>."#%//"*/#),-.'(),G#G11(3)..E#>:%,(#,%0"/E#
),*".."-*'%.#9:19":*;E#0%,'+%-*':),G#:)G$*/#%,(#("&".190",*#-1/*/L#M$"/"#
%//"*/#+1:0#9%:*#1+#*$"#2:1'9."#%//"*/#
3)*$),#*$"#62SL#
#
M$"#2:1'9#$%/#),-'::"(#"\9",()*':"#1,#("&".190",*#1+#,"3#9:1('-*/#),#*$"#
;"%:#3$)-$#%:"#-%9)*%.)/"(#)+#-":*%),#-:)*":)%#%:"#0"*#),#%--1:(%,-"#3)*$#FAD#
?a#gF,*%,G)>."#%//"*/gL#
!"#1>*%),"(#0%,%G"0",*1:%*),G#%//'09*)1,/#*$:1'G$#()/-'//)1,/#3)*$#19":%*)1,%.#
•
# P"&)"3#1+#*$"#()/-.1/':"/#),#*$"#+),%,-)%.#/*%*"0",*/L##
0%,%G"0",*Y#%,(#
.9K'BGA'D:BBA='
K:;':FF=A;;AF'78'
BGA':@F7B'
#
!"#%./1#%//"//"(#*$"#-%9)*%.)/%*)1,#1+#("&".190",*#-1/*/#('"#*1#*$"#)09%-*#
1,#:"91:*"(#"%:,),G/#%,(#*$"#c'(G"0",*/#),&1.&"(#),#%//"//),G#3$"*$":#*$"#
FAD#?a#-:)*":)%#+1:#-%9)*%.)/%*)1,#$%&"#>"",#0"*L#
!"#-1,/)(":"(#*$"#%01:*)/%*)1,#%--1',*),G#91.)-;#+1:#"%-$#-%*"G1:;#1+#
),*%,G)>."#%//"*L#
J%/"(#1,#1':#9:1-"(':"/E#3"#-1,-.'("(#*$%*#*$"#-%::;),G#&%.'"#%,(#
()/-.1/':"/#),#*$"#+),%,-)%.#/*%*"0",*/#3":"#%99:19:)%*"L#
HAE'9L;A=I:B798;'
36
'
#
!8IA8B9=E'I:?@:B798'
HAE':@F7B'D:BBA='
#
FA;>=76B798
.9K'BGA'D:BBA='
K:;':FF=A;;AF'78'
BGA':@F7B'
P"+":#*1#%--1',*),G#91.)-)"/#),#,1*"#CE#%--1',*),G#"/*)0%*"/#%,(#c'(G"0",*/#
),#,1*"#B#%,(#,1*"#COL#
M$"#2:1'9#$1.(/#%#-10>),%*)1,#1+#:%3#0%*":)%./#%,(#-1,/'0%>."/E#31:N#),#
9:1G:"//#%,(#+),)/$"(#G11(/L#
M$"#&%.'%*)1,#1+#),&",*1:;#)/#',(":9),,"(#>;#%99:19:)%*"#),&",*1:;#-1,*:1./#
%,(#&":)+)-%*)1,#%-:1//#0'.*)9."#>'/),"//"/#%,(#.1-%*)1,/L#
M$"#&%.'%*)1,#1+#),&",*1:;E#3$)-$#>;#)*/#,%*':"#)/#/9"-)%.)/*E#),&1.&"/#
c'(G"0",*#:".%*),G#*1#*$"#&%.'%*)1,#%,(#91*",*)%.#1>/1."/-",-"#1+#),&",*1:;#
),-.'(),G#,"*#:"%.)/%>."#&%.'"#7QP]=L##
M$"#2:1'9#$%/#),#9.%-"#%#91.)-;#+1:#%((:"//),G#*$)/#:)/N#%,(#:"-1G,)/"/#
9:1&)/)1,/#%--1:(),G.;L###
!"#%**",("(#%,(#',(":*11N#9$;/)-%.#),&",*1:;#-1',*/#%*#N";#.1-%*)1,/#
%-:1//#*$"#2:1'9E#&%.)(%*),G#*$%*#),&",*1:;#$".(#3%/#%--':%*".;#:"-1:("(#%,(#
3%/#),#G11(#9$;/)-%.#-1,()*)1,L##
!"#:"&)"3"(#%,(#*"/*"(#*$"#;"%:d",(#),&",*1:;#&%.'"/#%,(#9:1&)/)1,#
-%.-'.%*)1,/#9:"9%:"(#>;#0%,%G"0",*L#
!"#$%&"#-$%..",G"(#0%,%G"0",*#1,#*$"#%//'09*)1,/#%(19*"(#3)*$),#*$"#
9:1&)/)1,),G#-%.-'.%*)1,/#%,(#%//"//"(#%,;#/9"-)+)-#%:"%/#3$":"#%#9:1&)/)1,#
3%/#-1,/)(":"(#,"-"//%:;L#
!"#9":+1:0"(#*"/*),G#*1#",/':"#*$%*#*$"#&%.'%*)1,#1+#),&",*1:;#)/#/*%*"(#%*#
*$"#.13":#1+#-1/*#1:#QP]#>;#-109%:),G#*$"#/%."/#&%.'"#1+#*$"#9:1('-*/#*1#
*$"):#%-*'%.#-1/*L#
HAE'9L;A=I:B798;'
J%/"(#1,#1':#9:1-"(':"/#3"#-1,-.'("(#*$%*#*$"#-%::;),G#&%.'"#1+#),&",*1:;#
)/#/%*)/+%-*1:;L#
5:==E78C'I:?@A'9<';@L;7F7:=E'78IA;BDA8B;':8F'78BA=>9D6:8E'=A>A7I:L?A;'
HAE':@F7B'D:BBA='
#
FA;>=76B798
M$"#9%:",*#6109%,;#$%/#),&"/*0",*/#),#%,(#),*":-109%,;#(">*1:#>%.%,-"/#
3)*$#/"&":%.#-109%,)"/#3$)-$#*1G"*$":#+1:0#%#.%:G"#9:191:*)1,#1+#*$"#9%:",*#
6109%,;g/#%//"*/L#
P"+":#*1#%--1',*),G#91.)-)"/#),#,1*"#6CE#,1*"#6`#%,(#,1*"#6hL#
#
!"#1>*%),"(#0%,%G"0",*g/#)09%):0",*#%//"//0",*/#1+#*$"#-%::;),G#&%.'"/#
%,(#',(":*11N#%'()*#9:1-"(':"/#),-.'(),GX#
#
•
# 61,/)(":"(#*$"#>%/)/#1+#*$"#%//"//0",*E#),-.'(),G#*$"#:".)%>).)*;#1+#
+1:"-%/*/#%,(#*$%*#*$"/"#$%&"#>"",#/)G,"(#1++#>;#*$"#:"/9"-*)&"#
>1%:(/E#*1G"*$":#3)*$#',(":.;),G#%//"*/#1+#*$"#/'>/)()%:)"/Y#
•
# A//"//"(#N";#%//'09*)1,/#%(19*"(#>%/"(#1,#"&)(",-"#9:1&)("(E#
$)/*1:)-%.#*:",(/E#+'*':"#9:1c"-*"(#9:1+)*/#%,(#&":)+)"(#*$"#,"*#%//"*#
&%.'"/Y#
•
# [>*%),"(#%,(#-$%..",G"(#*$"#"\9"-*"(#-:"()*#.1//#%//"//0",*#1,#
•
# 61,+):0"(#*$%*#%,;#)09%):0",*#)(",*)+)"(#>;#0%,%G"0",*#)/#
•
# A//"//"(#*$"#()/-.1/':"/#),#:"/9"-*#1+#*$"/"#)09%):0",*#:"&)"3/E#
),-.'(),G#-1,/)(":%*)1,#1+#*$"#:"I'):"0",*/#1+#FKPDi#%,(#FAD?OL#
J%/"(#1,#1':#9:1-"(':"/E#*$"#-%::;),G#&%.'"/#%,(#%//1-)%*"(#()/-.1/':"/#
3":"#-1,/)(":"(#%--"9*%>."L#
%99:19:)%*".;#),-.'("(#),#*$"#+),%,-)%.#/*%*"0",*/Y#%,(#
),*:%G:1'9#>%.%,-"/Y#
.9K'BGA'D:BBA='
K:;':FF=A;;AF'78'
BGA':@F7B'
HAE'9L;A=I:B798;'
#
#
#
37
*@=':66?7>:B798'9<'D:BA=7:?7BE'
!$",#"/*%>.)/$),G#1':#1&":%..#%'()*#/*:%*"G;E#3"#/"*#-":*%),#*$:"/$1.(/#3$)-$#$".9#'/#*1#("*":0),"#*$"#
,%*':"E# *)0),G# %,(# "\*",*# 1+# 1':# %'()*# 9:1-"(':"/L# !$",# "&%.'%*),G# 3$"*$":# *$"# "++"-*/# 1+#
0)//*%*"0",*/E#>1*$#),()&)('%..;#%,(#1,#*$"#+),%,-)%.#/*%*"0",*/#%/#%#3$1."E#-1'.(#:"%/1,%>.;#),+.'",-"#
*$"# "-1,10)-# ("-)/)1,/# 1+# *$"# '/":/# 3"# *%N"# ),*1# %--1',*# *$"# I'%.)*%*)&"# ,%*':"# %,(# *$"# /)j"# 1+# *$"#
0)//*%*"0",*/L#J%/"(#1,#1':#9:1+"//)1,%.#c'(G"0",*E#3"#("*":0),"(#0%*":)%.)*;#%/#+1..13/X#
#
'
*IA=:??'D:BA=7:?7BE'
0:;7;'<9='FABA=D7878C'
9IA=:??'D:BA=7:?7BE'
+:B798:?A'<9='
LA8>GD:=M':66?7AF'
2=9@6'
_O`CE@@@#
ZL`b#1+#*31#;"%:#%&":%G"#
%(c'/*"(#9:1+)*#>"+1:"#*%\L#
4:1+)*#>"+1:"#*%\#$%/#>"",#
%(c'/*"(#+1:#0%*":)%.#,1,d
:"-'::),G#)*"0/L#
%:=A8B'59D6:8E'
_`@@E@@@#
@LZb#1+#M1*%.#A//"*/#
4:1+)*#>"+1:"#*%\#)/#-1,/)(":"(#*$"#
N";#>",-$0%:N#1+#*$"#2:1'9L##!"#
$%&"#,1:0%.)/"(#*$)/#1&":#%#*31#
;"%:#9":)1(#*1#:"+."-*#*$"#+%-*#*$%*#
/10"#:"&",'"#-1,*:%-*/#/9%,#
0'.*)9."#9":)1(/L#
M1*%.#%//"*/#)/#-1,/)(":"(#*$"#N";#
>",-$0%:N#
9%:",*#
1+#
6109%,;#%/#*$"#",*)*;#:".)"/#1,#)*/#
),&"/*0",*/# %/# %# ,1,d:"&",'"#
G",":%*),G#",*)*;L#
*$"#
%A=<9=D:8>A'D:BA=7:?7BE'
_Z`OE@@@#
_?`@E@@@#
0:;7;'<9='FABA=D7878C'
6A=<9=D:8>A'D:BA=7:?7BE'
+A69=B78C'9<'
D7;;B:BADA8B;'B9'BGA'
(@F7B'59DD7BBAA'
h@b#1+#1&":%..#0%*":)%.)*;#
h@b#1+#1&":%..#0%*":)%.)*;#
e)//*%*"0",*/#),#"\-"//#1+#
_?BE`@@#%,(#0)//*%*"0",*/#>".13#
*$%*#*$:"/$1.(#*$%*E#),#1':#&)"3E#
3%::%,*"(#:"91:*),G#1,#I'%.)*%*)&"#
G:1',(/L##
e)//*%*"0",*/#),#"\-"//#1+#
_B`E@@@#%,(#0)//*%*"0",*/#
>".13#*$%*#*$:"/$1.(#*$%*E#),#1':#
&)"3E#3%::%,*"(#:"91:*),G#1,#
I'%.)*%*)&"#G:1',(/L##
!
(8'9IA=I7AK'9<'BGA';>96A'9<'9@=':@F7B'
M$"#2:1'9#-1,/)/*/#1+#?`#-1091,",*/E#.1-%*"(#),#*$"#+1..13),G#-1',*:)"/X##
•
# S,)*"(#T),G(10#
•
# 2":0%,;#
•
#
F,()%#
•
# D1'*$#A+:)-%#
•
# M$%).%,(#
•
# 6$),%#
•
# D1'*$#T1:"%#
•
# J:%j).#
•
# A'/*:%.)%#
•
# K),.%,(
38
!
#
#
M$"#-1&":%G"#%-$)"&"(#>;#1':#%'()*#9:1-"(':"/#3%/X#
#
1@??';>96A':@F7B'
-6A>7<7>':@F7B'
6=9>AF@=A;''
&9B:?'
"@DLA='9<'
>9D698A8B;'
CC#
d#
OO'
+AIA8@A'
&9B:?':;;AB;'
%=9<7B'LA<9=A'B:N'
a@b#
d#
PQR'
a`b#
d#
PSR'
a?b#
d#
PTR'
A,%.;*)-%.#9:1-"(':"/#%*#2:1'9#."&".#3":"#9":+1:0"(#+1:#*$"#:"0%),),G#BZ#-1091,",*/L##
#
[+#*$"#%>1&"E#+'..#/-19"#%'()*/#+1:#+1':#-1091,",*/#3":"#',(":*%N",#>;#-1091,",*#%'()*1:/L##M$"#G:1'9#
*"%0#$%(#9.%,,"(#*1#&)/)*#.1-%*)1,/#),#2":0%,;#%,(#F,()%E#$13"&":E#*$"/"#&)/)*/#3":"#9:"&",*"(#>;#*:%&".#
:"/*:)-*)1,/#)091/"(#%/#%#:"/'.*#1+#*$"#61&)(dCi#9%,("0)-L##F,/*"%(#*$"#G:1'9#*"%0#9":+1:0"(#&):*'%.#
-%../#%,(#:"01*"#+)."#:"&)"3/#*1#%//"//#*$"#%'()*#:)/N/E#*$"#31:N#9.%,,"(#%,(#*$"#31:N#9":+1:0"(L#
!
*BGA='78<9=D:B798'
M$"#1*$":#),+1:0%*)1,#-109:)/"/#*$"#),+1:0%*)1,#),-.'("(#),#*$"#%,,'%.#:"91:*#1*$":#*$%,#*$"#+),%,-)%.#
/*%*"0",*/# %,(# 1':# %'()*1:."# +1:# *$"# 1*$":# ),+1:0%*)1,#
-1,*%),"(#3)*$),#*$"#%,,'%.#:"91:*L#[':#19),)1,#1,#*$"#+),%,-)%.#/*%*"0",*/#(1"/#,1*#-1&":#*$"#1*$":#
),+1:0%*)1,#%,(E#"\-"9*#*1#*$"#"\*",*#1*$":3)/"#"\9.)-)*.;#/*%*"(#),#1':#:"91:*E#3"#(1#,1*#"\9:"//#%,;#
+1:0#1+#%//':%,-"#-1,-.'/)1,#*$":"1,L##
#
[':# :"/91,/)>).)*;# )/# *1# :"%(# *$"# 1*$":# ),+1:0%*)1,# %,(E# ),# (1),G# /1E# -1,/)(":# 3$"*$":# *$"# 1*$":#
),+1:0%*)1,# )/# 0%*":)%..;# ),-1,/)/*",*# 3)*$# *$"# +),%,-)%.# /*%*"0",*/# 1:# 1':# N,13."(G"# 1>*%),"(# ),# *$"#
-1':/"# 1+# *$"# %'()*# 1:# 1*$":3)/"# %99"%:/# *1# >"# 0%*":)%..;# 0)//*%*"(L# F+# 3"# )(",*)+;# /'-$# 0%*":)%.#
),-1,/)/*",-)"/#1:#%99%:",*#0%*":)%.#0)//*%*"0",*/E#3"#%:"#:"I'):"(#*1#("*":0),"#3$"*$":#*$)/#G)&"/#
:)/"#*1#%#0%*":)%.#0)//*%*"0",*#),#*$"#+),%,-)%.#/*%*"0",*/#*$"0/".&"/L#F+E#>%/"(#1,#*$"#31:N#3"#$%&"#
9":+1:0"(E#3"#-1,-.'("#*$%*#*$":"#)/#%#0%*":)%.#0)//*%*"0",*#1+#*$)/#1*$":#),+1:0%*)1,E#3"#%:"#:"I'):"(#
*1#:"91:*#*$%*#+%-*L##
#
!"#$%&"#,1*$),G#*1#:"91:*#),#*$)/#:"G%:(L#
#
*678798;'98'9BGA='D:BBA=;'6=A;>=7LAF'LE'BGA'59D6:87A;'(>B'UQQV'
F,#1':#19),)1,E#*$"#9%:*#1+#*$"#():"-*1:/<#:"0',":%*)1,#:"91:*#*1#>"#%'()*"(#$%/#>"",#9:19":.;#9:"9%:"(#
),#%--1:(%,-"#3)*$#*$"#6109%,)"/#A-*#B@@OL#
#
F,#1':#19),)1,E#>%/"(#1,#*$"#31:N#',(":*%N",#),#*$"#-1':/"#1+#*$"#%'()*X#
•
#
##
•
#
*$"#),+1:0%*)1,#G)&",#),#*$"#D*:%*"G)-#P"91:*#%,(#*$"
3$)-$#*$"#+),%,-)%.#/*%*"0",*/#%:"#9:"9%:"(#)/#-1,/)/*",*#3)*$#*$"#+),%,-)%.#/*%*"0",*/Y#%,(#
*$"#D*:%*"G)-#P"91:*#%,(#*$"#V):"-*1:/<#P"91:*#$%&"#>"",#9:"9%:"(#),#%--1:(%,-"#3)*$#
%99.)-%>."#."G%.#:"I'):"0",*/L#
V):"-*1:/<#P"91:*#+1:#*$"#+),%,-)%.#;"%:#+1:#
!
#
#
/:BBA=;'98'KG7>G'KA':=A'=AW@7=AF'B9'=A69=B'LE'AN>A6B798'
F,# *$"# .)G$*# 1+# *$"# N,13."(G"# %,(# ',(":/*%,(),G# 1+# *$"# 2:1'9# %,(# *$"# 9%:",*# 6109%,;# %,(# *$"):#
",&):1,0",*#1>*%),"(#),#*$"#-1':/"#1+#*$"#%'()*E#3"#$%&"#,1*#)(",*)+)"(#0%*":)%.#0)//*%*"0",*/#),#*$"#
D*:%*"G)-#P"91:*#1:#*$"#V):"-*1:/<#P"91:*L#
#
#
#
#
#
39
!"#$%&"#,1*$),G#*1#:"91:*#),#:"/9"-*#1+#*$"#+1..13),G#0%**":/#),#:".%*)1,#*1#3$)-$#*$"#6109%,)"/#A-*#
B@@O#:"I'):"/#'/#*1#:"91:*#*1#;1'#)+E#),#1':#19),)1,X#
•
•
•
•
%("I'%*"#%--1',*),G#:"-1:(/#$%&"#,1*#>"",#N"9*#>;#*$"#9%:",*#6109%,;E#1:#:"*':,/#%("I'%*"
+1:#1':#%'()*#$%&"#,1*#>"",#:"-")&"(#+:10#>:%,-$"/#,1*#&)/)*"(#>;#'/Y#1:
*$"#9%:",*#6109%,;#+),%,-)%.#/*%*"0",*/#%,(#*$"#9%:*#1+#*$"#():"-*1:/<#:"0',":%*)1,#:"91:*#*1
>"#%'()*"(#%:"#,1*#),#%G:""0",*#3)*$#*$"#%--1',*),G#:"-1:(/#%,(#:"*':,/Y#1:
-":*%),#()/-.1/':"/#1+#():"-*1:/<#:"0',":%*)1,#/9"-)+)"(#>;#.%3#%:"#,1*#0%("Y#1:
3"#$%&"#,1*#:"-")&"(#%..#*$"#),+1:0%*)1,#%,(#"\9.%,%*)1,/#3"#:"I'):"#+1:#1':#%'()*L
59=69=:BA'C9IA=8:8>A';B:BADA8B'
M$"#5)/*),G#P'."/#:"I'):"#'/#*1#:"&)"3#*$"#():"-*1:/<#/*%*"0",*#),#:".%*)1,#*1#G1),G#-1,-":,E#.1,G":d*":0#
&)%>).)*;# %,(# *$%*# 9%:*# 1+# *$"# 61:91:%*"# 21&":,%,-"# D*%*"0",*# :".%*),G# *1# *$"# 9%:",*# 6109%,;*%),"(#(':),G#*$"#%'()*X#
•
(cid:3)
(cid:30)
(cid:3)
V):"-*1:/<#/*%*"0",*#3)*$#:"G%:(/#*$"#%99:19:)%*","//#1+#%(19*),G#*$"#G1),G#-1,-":,#>%/)/#1+
%--1',*),G#%,(#%,;#0%*":)%.#',-":*%),*)"/#)(",*)+)"(#/"*#1'*#1,#9%G"#Ca
V):"-*1:/<#"\9.%,%*)1,#%/#*1#)*/#%//"//0",*#1+#*$"#G:1'9%.%,-"(#%,(#',(":/*%,(%>."#/"*#1'*#1,#9%G"#ChY
J1%:('/*#%//"//0",*#1+#*$"#"0":G),G#%,(#9:),-)9%.
:)/N/#/"*#1'*#1,#9%G"#CBY
M$"#/"-*)1,#1+#*$"#%,,'%.#:"91:*#*$%*#("/-:)>"/#*$"#:"&)"3#1+#"++"-*)&","//#1+#:)/N
%,(#),*":,%.#-1,*:1.#/;/*"0/#/"*#1'*#1,#9%G"#CBY#%,(E
M$"#/"-*)1,#("/-:)>),G#*$"#31:N#1+#*$"#%'()*#-100)**""#/"*#1'*#1,#9%G"#B?L
(cid:3)
0%,%G"0",*#
(cid:3)
•
•
•
•
•
+A;698;7L7?7B7A;'9<'F7=A>B9=;'
A/#"\9.%),"(#01:"#+'..;#),#*$"#/*%*"0",*#1+#():"-*1:/<#:"/91,/)>).)*)"/#/"*#1'*#1,#9%G"#?BE#*$"#():"-*1:/#
%:"#:"/91,/)>."#+1:#*$"#9:"9%:%*)1,#1+#*$"#+),%,-)%.#/*%*"0",*/#%,(#+1:#>"),G#/%*)/+)"(#*$%*#*$";#G)&"#%#
*:'"#%,(#+%):#&)"3E#%,(#+1:#/'-$#),*":,%.#-1,*:1.#%/#*$"#():"-*1:/#("*":0),"#)/#,"-"//%:;#*1#",%>."#*$"#
9:"9%:%*)1,#1+#+),%,-)%.#/*%*"0",*/#*$%*#%:"#+:""#+:10#0%*":)%.#0)//*%*"0",*E#3$"*$":#('"#*1#+:%'(#1:#
"::1:L#
F,#9:"9%:),G#*$"#+),%,-)%.#/*%*"0",*/E#*$"#():"-*1:/#%:"#:"/91,/)>."#+1:#%//"//),G#*$"#2:1'9).)*;#*1#-1,*),'"#%/#%#G1),G#-1,-":,E#()/-.1/),GE#%/#%99.)-%>."E#0%**":/#:".%*"(#*1#
G1),G# -1,-":,# %,(# '/),G# *$"# G1),G# -1,-":,# >%/)/# 1+#%--1',*),G# ',."//# *$"# ():"-*1:/# ")*$":# ),*",(# *1#
.)I')(%*"#*$"#2:1'9#1:#*$"#9%:",*#6109%,;#1:#*1#-"%/"#19":%*)1,/E#1:#$%&"#,1#:"%.)/*)-#%.*":,%*)&"#>'*#
*1#(1#/1L#
(@F7B9=,;'=A;698;7L7?7B7A;'<9='BGA':@F7B'9<'BGA'<78:8>7:?';B:BADA8B;'
[':#1>c"-*)&"/#%:"#*1#1>*%),#:"%/1,%>."#%//':%,-"#%>1'*#3$"*$":#*$"#+),%,-)%.#/*%*"0",*/#%/#%#3$1."#
%:"#+:""#+:10#0%*":)%.#0)//*%*"0",*E#3$"*$":#('"#*1#+:%'(#1:#"::1:E#%,(#*1#)//'"#%,#%'()*1:."#%//':%,-"#)/#%#$)G$#."&".#1+#%//':%,-"E#>'*#)/#,1*#%#G'%:%,*""#*$%*#%,#
%'()*#-1,('-*"(#),#%--1:(%,-"#3)*$#FDA/#7ST=#3)..#%.3%;/#("*"-*#%#0%*":)%.#0)//*%*"0",*#3$",#)*#"\)/*/L#
e)//*%*"0",*/# -%,# %:)/"# +:10# +:%'(# 1:# "::1:# %,(# %:"# -1,/)(":"(# 0%*":)%.# )+E# ),()&)('%..;# 1:# ),# *$"#
%GG:"G%*"E#*$";#-1'.(#:"%/1,%>.;#>"#"\9"-*"(#*1#),+.'",-"#*$"#"-1,10)-#("-)/)1,/#1+#'/":/#*%N",#1,#
*$"#>%/)/#1+#*$"/"#+),%,-)%.#/*%*"0",*/L#
40
&GA'ANBA8B'B9'KG7>G'BGA':@F7B'K:;'>98;7FA=AF'>:6:L?A'9<'FABA>B78C'7==AC@?:=7B7A;Z'78>?@F78C'
<=:@F'
F::"G'.%:)*)"/#%:"#),/*%,-"/#1+#,1,d-109.)%,-"#3)*$#.%3/#%,(#:"G'.%*)1,/L##M$"#1>c"-*)&"/#1+#1':#%'()*#
%:"#*1#1>*%),#/'++)-)",*#%99:19:)%*"#%'()*#"&)(",-"#:"G%:(),G#-109.)%,-"#3)*$#.%3/#%,(#:"G'.%*)1,/#*$%*#
$%&"# %# ():"-*# "++"-*# 1,# *$"# ("*":0),%*)1,# 1+# 0%*":)%.# %01',*/# %,(# ()/-.1/':"/# ),# *$"# +),%,-)%.#
/*%*"0",*/E#*1#9":+1:0#%'()*#9:1-"(':"/#*1#$".9#)(",*)+;#),/*%,-"/#1+#,1,d-109.)%,-"#3)*$#1*$":#.%3/#
%,(# :"G'.%*)1,/
*$%*# 0%;# $%&"# %# 0%*":)%.# "++"-*# 1,# *$"# +),%,-)%.# /*%*"0",*/E# %,(# *1# :"/91,(#
%99:19:)%*".;#*1#)(",*)+)"(#1:#/'/9"-*"(#,1,d-109.)%,-"#3)*$#.%3/#%,(#:"G'.%*)1,/#)(",*)+)"(#(':),G#*$"#
%'()*L###
(cid:3)
F,# :".%*)1,# *1# +:%'(E# *$"# 1>c"-*)&"/# 1+# 1':# %'()*# %:"# *1# )(",*)+;# %,(# %//"//# *$"# :)/N# 1+# 0%*":)%.#
0)//*%*"0",*#1+# *$"# +),%,-)%.#/*%*"0",*/# ('"# *1# +:%'(E# *1# 1>*%),#/'++)-)",*# %99:19:)%*"#%'()*# "&)(",-"#
:"G%:(),G# *$"# %//"//"(# :)/N/# 1+# 0%*":)%.# 0)//*%*"0",*# ('"# *1# +:%'(# *$:1'G$# ("/)G,),G# %,(#
)09."0",*),G# %99:19:)%*"# :"/91,/"/# %,(# *1# :"/91,(# %99:19:)%*".;# *1# +:%'(# 1:# /'/9"-*"(# +:%'(#
)(",*)+)"(#(':),G#*$"#%'()*L###
k13"&":E# )*# )/# *$"# 9:)0%:;# :"/91,/)>).)*;# 1+# 0%,%G"0",*E# 3)*$# *$"# 1&":/)G$*# 1+# *$1/"# -$%:G"(# 3)*$#
G1&":,%,-"E#*1#",/':"#*$%*#*$"#",*)*;g/#19":%*)1,/#%:"#-1,('-*"(#),#%--1:(%,-"#3)*$#*$"#9:1&)/)1,/#1+#
.%3/#%,(#:"G'.%*)1,/#%,(#+1:#*$"#9:"&",*)1,#%,(#("*"-*)1,#1+#+:%'(L#
F,#)(",*)+;),G#%,(#%//"//),G#:)/N/#1+#0%*":)%.#0)//*%*"0",*#),#:"/9"-*#1+#)::"G'.%:)*)"/E#),-.'(),G#
+:%'(E#*$"#2:1'9#%'()*#",G%G"0",*#*"%0#%,(#-1091,",*#%'()*1:/X##
•
•
•
1>*%),"(#%,#',(":/*%,(),G#1+#*$"#,%*':"#1+#*$"#),('/*:;#%,(#/"-*1:E#),-.'(),G#*$"#."G%.#%,(
:"G'.%*1:;#+:%0"31:N/#*$%*#*$"#2:1'9#%,(#9%:",*#6109%,;#19":%*"/#),#%,(#$13#*$"#2:1'9
%,(#9%:",*#6109%,;#%:"#-109.;),G#3)*$#*$"#."G%.#%,(#:"G'.%*1:;#+:%0"31:N/Y
),I'):"(#1+#0%,%G"0",*E#%,(#*$1/"#-$%:G"(#3)*$#G1&":,%,-"E#%>1'*#*$"):#13,#)(",*)+)-%*)1,
%,(#%//"//0",*#1+#*$"#:)/N/#1+#)::"G'.%:)*)"/E#),-.'(),G#%,;#N,13,#%-*'%.E#/'/9"-*"(#1:#%.."G"(
),/*%,-"/#1+#+:%'(Y
()/-'//"(#0%**":/#%>1'*#,1,d-109.)%,-"#3)*$#.%3/#%,(#:"G'.%*)1,/#%,(#$13#+:%'(#0)G$*#1--':
),-.'(),G#%//"//0",*#1+#$13#%,(#3$":"#*$"#+),%,-)%.#/*%*"0",*/#0%;#>"#/'/-"9*)>."#*1#+:%'(
+1:#:"G'.%*"(#",*)*)"/E#%/#("+),"(#),#FDA#B`@JX#$%&),G#1>*%),"(#%,#',(":/*%,(),G#1+#*$"
"++"-*)&","//#1+#*$"#-1,*:1.#",&):1,0",*L
A..#:"."&%,*#.%3/#%,(#:"G'.%*)1,/#)(",*)+)"(#%*#%#2:1'9#."&".#%,(#%:"%/#/'/-"9*)>."#*1#+:%'(#*$%*#-1'.(#
$%&"# %# 0%*":)%.# "++"-*# 1,# *$"# +),%,-)%.# /*%*"0",*/# 3":"# -100',)-%*"(# *1# -1091,",*# %'()*1:/L## A,;#
),/*%,-"/#1+#,1,d-109.)%,-"#3)*$#.%3/#%,(#:"G'.%*)1,/#)(",*)+)"(#%,(#-100',)-%*"(#>;#%#-1091,",*#
%'()*1:#3":"#-1,/)(":"(#),#1':#%'()*#%99:1%-$L#
M$"#01/*#/)G,)+)-%,*#.%3/#%,(#:"G'.%*)1,/#3":"#("*":0),"(#%/#+1..13/X#
4AC7;?:B798'['
+AC@?:B798'
!1+-[1+-OQO'
:8F'59D6:87A;'
(>B'UQQV'
&:N'>9D6?7:8>A'
=AC@?:B798;'
(FF7B798:?':@F7B'6=9>AF@=A;'6A=<9=DAF'LE'BGA'2=9@6':@F7B'
A8C:CADA8B'BA:D':8F'>9D698A8B':@F7B9=;'78>?@FAF\'
P"&)"3# 1+# *$"# +),%,-)%.# /*%*"0",*# ()/-.1/':"/# %,(# *"/*),G# *1# /'991:*),G#
(1-'0",*%*)1,Y#
6109."*)1,#1+#()/-.1/':"#-$"-N.)/*/#*1#)(",*)+;#%:"%/#1+#,1,d-109.)%,-"L#
F,9'*#+:10#%#*%\#/9"-)%.)/*#3%/#1>*%),"(#:"G%:(),G#2:1'9B@=78C'
:8F' 96A=:B798:?'
=AC@?:B798;'
FDA/# .)0)*# *$"# :"I'):"(# %'()*# 9:1-"(':"/# *1# )(",*)+;# ,1,d-109.)%,-"# 3)*$#
*$"/"#.%3/#%,(#:"G'.%*)1,/#*1#),I'):;#1+#0%,%G"0",*#%,(#3$":"#%99:19:)%*"E#
*$1/"#-$%:G"(#3)*$#G1&":,%,-"#7%/#,1*"(#%>1&"=#%,(#),/9"-*)1,#1+#."G%.#%,(#
:"G'.%*1:;#-1::"/91,(",-"E#)+#%,;L#
41
M$"#%:"%/#*$%*#3"#)(",*)+)"(#%/#>"),G#/'/-"9*)>."#*1#0%*":)%.#0)//*%*"0",*#('"#*1#+:%'(#3":"X#
+7;M'
+AIA8@A'
=A>9C87B798'J'
9IA='B7DA';:?A;'
+AIA8@A'
=A>9C87B798'J'
6978B'78'B7DA'
;:?A;'
/:8:CADA8B'
9IA==7FA'9<'
>98B=9?;''
(@F7B'6=9>AF@=A;'6A=<9=DAF'LE'BGA':@F7B'A8C:CADA8B'BA:D\'
M:%,/%-*)1,/#91/*"(#*1#,10),%.#."(G":#-1("/#1'*/)("#1+#*$"#,1:0%.#:"&",'"#
-;-."#3":"#)(",*)+)"(#'/),G#%#(%*%#%,%.;*)-#*11.#%,(#),&"/*)G%*"(L#
D""#%./1#*$"#N";#%'()*#0%**":/#/"-*)1,#1+#*$)/#:"91:*#+1:#31:N#9":+1:0"(#1&":#
*$)/#:)/NL#
P"&",'"/#%*#*$"#9":)1(#",(#3":"#*"/*"(#*1#)(",*)+;#+1:#:"&",'"#:"-1G,)/"(#
),#*$"#),-1::"-*#9":)1(L#
D""#%./1#*$"#N";#%'()*#0%**":/#/"-*)1,#1+#*$)/#:"91:*#+1:#31:N#9":+1:0"(#1,#
*$)/#%:"%L#
M"/*),G#*$"#%99:19:)%*","//#1+#c1':,%.#",*:)"/#%,(#1*$":#%(c'/*0",*/Y#
A//"//),G# 3$"*$":# *$"# c'(G"0",*/# "\":-)/"(# ),# 0%N),G# %--1',*),G#
"/*)0%*"/#%:"#),()-%*)&"#1+#%#91*",*)%.#>)%/L#
H&%.'%*),G# *$"# >'/),"//# :%*)1,%."# 1+# %,;# /)G,)+)-%,*# *:%,/%-*)1,/# *$%*# %:"#
','/'%.#1:#1'*/)("#*$"#,1:0%.#-1':/"#1+#>'/),"//L#
A# +':*$":# ("/-:)9*)1,# 1+# 1':# :"/91,/)>).)*)"/# +1:# *$"# %'()*# 1+# *$"# +),%,-)%.# /*%*"0",*/# )/# .1-%*"(# 1,# *$"#
K),%,-)%.#P"91:*),G#61',-)./)*"#%*X#$**9XRR333L+:-L1:GL'NR%'()*1:/:"/91,/)>).)*)"/L#M$)/#("/-:)9*)1,#
+1:0/#9%:*#1+#1':#%'()*1:G'KA':=A'=AW@7=AF'B9':FF=A;;'
K1..13),G#*$"#:"-100",(%*)1,#1+#*$"#%'()*#-100)**""E#3"#3":"#%991),*"(#>;#*$"#J1%:(#1+#V):"-*1:/#1,#
Ci# e%:-$# B@BC# *1# %'()*# *$"# +),%,-)%.# /*%*"0",*/# +1:# *$"# ;"%:# ",("(# ?@# A9:).# B@BC# %,(# /'>/"I'",*#
+),%,-)%.#9":)1(/L#
M$"#9":)1(#1+#*1*%.#',),*"::'9*"(#-1,/"-'*)&"#%991),*0",*/#)/#1,"#;"%:L#
M$"#,1,d%'()*#/":&)-"/#9:1$)>)*"(#>;#*$"#KP6":/E#%/#%#>1(;E#),#%--1:(%,-"#3)*$#6$%9*":#?#1+#4%:*#
CO# 1+# *$"# 6109%,)"/# A-*# B@@OL# # [':# %'()*# 31:N# $%/# >"",# ',(":*%N",# /1# *$%*# 3"# 0)G$*# /*%*"# *1# *$"#
6109%,;":/#*$1/"#0%**":/#3"#%:"#:"I'):"(#*1#/*%*"#*1#*$"0#),#%,#%'()*1:;# .%3E# 3"# (1# ,1*# %--"9*# 1:# %//'0"# :"/91,/)>).)*;# *1#
%,;1,"#1*$":#*$%,#*$"#6109%,;#%,(#*$"#6109%,;":/#%/#%#>1(;E#+1:#1':#%'()*#31:NE#+1:#*$)/#
:"91:*E#1:#+1:#*$"#19),)1,/#3"#$%&"#+1:0"(L#
F%,#!%..#7D",)1:#D*%*'*1:;#A'()*1:=#
K1:#%,(#1,#>"$%.+#1+#PDe#ST#A'()*#554E#D*%*'*1:;#A'()*1:#
6$%:*":"(#A--1',*%,*/#
K"/*)&%.#!%;#
K"/*)&%.#4%:N#
D*1N"d1,dM:",*#
DMC#`JJ#
42
FINANCIAL STATEMENTS
GOODWIN PLC
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
for the year ended 30th April, 2021
Notes
2021
£’000
2020
£’000
CONTINUING OPERATIONS
Revenue … … … … … … … … … …
3, 4
131,231
Cost of sales
… … … … … … … … …
(92,230)
GROSS PROFIT… … … … … … … … … …
Other income
… … … … … … … … …
5
Distribution expenses … … … … … … … …
Administrative expenses
… … … … … … …
39,001
763
(2,988)
(19,682)
144,512
(109,743)
34,769
690
(2,792)
(19,809)
OPERATING PROFIT … … … … … … … … …
17,094
12,858
Finance costs (net)
… … … … … … … …
Share of profit of associate company
… … … … …
PROFIT BEFORE TAXATION
… … … … … … …
Tax on profit
… … … … … … … … …
7
14
5
8
(640)
60
(809)
66
16,514
(3,508)
12,115
(3,775)
PROFIT AFTER TAXATION… … … … … … … …
13,006
8,340
ATTRIBUTABLE TO:
Equity holders of the parent … … … … … … …
Non-controlling interests
… … … … … … …
12,494
512
7,866
474
PROFIT FOR THE YEAR … … … … … … … …
13,006
8,340
BASIC EARNINGS PER ORDINARY SHARE
… … … …
DILUTED EARNINGS PER ORDINARY SHARE … … … …
9
9
167.82p
107.93p
164.23p
103.31p
The notes on pages 49 to 96 form part of these financial statements.
43
FINANCIAL STATEMENTS
GOODWIN PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 30th April, 2021
PROFIT FOR THE YEAR … … … … … … … … …
2021
£’000
13,006
2020
£’000
8,340
OTHER COMPREHENSIVE INCOME / (EXPENSE)
ITEMS THAT WILL NOT BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS:
Goodwill arising from purchase of non-controlling interest in subsidiaries
-
(72)
ITEMS THAT MAY BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS:
Foreign exchange translation differences … … … … … …
… …
Effective portion of changes in fair value of cash flow hedges
Ineffectiveness in cash flow hedges transferred to profit or loss … …
Change in fair value of cash flow hedges transferred to profit or loss
…
Effective portion of changes in fair value of cost of hedging … … …
Ineffectiveness in cost of hedging transferred to profit or loss
… …
Change in fair value of cost of hedging transferred to profit or loss … …
Tax (charge) / credit on items that may be reclassified subsequently
(1,371)
1,296
(657)
1,932
(37)
631
381
(1,007)
(355)
-
522
(843)
-
395
to profit or loss … … … … … … … … … …
(673)
77
OTHER COMPREHENSIVE INCOME / (EXPENSE) FOR THE YEAR,
NET OF INCOME TAX… … … … … … … … … …
1,502
(1,283)
TOTAL COMPREHENSIVE INCOME FOR THE YEAR … … … …
14,508
7,057
ATTRIBUTABLE TO:
Equity holders of the parent … … … … … … … …
Non-controlling interests
… … … … … … … …
14,081
427
14,508
6,587
470
7,057
The notes on pages 49 to 96 form part of these financial statements.
44
FINANCIAL STATEMENTS
GOODWIN PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 30th April, 2021
Share-
Trans-
based
lation payment
reserve
£’000
reserve
£’000
Share
capital
£’000
Cash
flow Cost of
hedge hedging Retained
reserve earnings
£’000
reserve
£’000
£’000
Total
attributable
to equity
Non-
holders of controlling
interests
the parent
£’000
£’000
Total
equity
£’000
YEAR ENDED
30TH APRIL, 2021
Balance at 1st May, 2020 …
736
361
5,244
(499)
(743) 99,918
105,017
4,585 109,602
Total comprehensive income:
Profit for the year … …
Other comprehensive income:
Foreign exchange translation
differences … … …
Effective portion of changes
in fair value
Ineffectiveness transferred
to profit or loss
Change in fair value
transferred to profit
or loss … … … …
Tax
… … … …
TOTAL COMPREHENSIVE
INCOME / (EXPENSE)
FOR THE YEAR
Transactions with owners:
Issue of shares … … …
Dividends paid … … …
Recycling of translation
reserve on the disposal
of subsidiary … … …
BALANCE AT
30TH APRIL, 2021
-
-
-
-
-
-
-
(1,255)
-
-
-
-
-
(1,255)
17
-
-
-
-
42
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,252
(42)
(617)
596
1,957
(492)
362
(174)
12,494
12,494
512
13,006
-
-
-
-
-
(1,255)
(116)
(1,371)
1,210
49
1,259
(21)
(5)
(26)
2,319
(666)
(6)
(7)
2,313
(673)
2,100
742 12,494
14,081
427 14,508
-
-
-
-
-
-
-
17
-
17
(6,016)
(6,016)
(125)
(6,141)
-
42
-
42
753
(852)
5,244
1,601
(1) 106,396
113,141
4,887 118,028
The notes on pages 49 to 96 form part of these financial statements.
45
FINANCIAL STATEMENTS
GOODWIN PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (continued)
for the year ended 30th April, 2021
Share-
Trans-
based
lation payment
reserve
£’000
reserve
£’000
Share
capital
£’000
Cash
flow Cost of
hedge hedging Retained
reserve earnings
£’000
reserve
£’000
£’000
Total
attributable
to equity
Non-
holders of controlling
interests
the parent
£’000
£’000
Total
equity
£’000
YEAR ENDED
30TH APRIL, 2020
Balance at 1st May, 2019 …
720
1,044
4,991
(573)
(426)
99,409
105,165
4,126 109,291
Total comprehensive income:
Profit for the year … …
Other comprehensive income:
Foreign exchange translation
differences … … …
Goodwill arising from
purchase of NCI interest
in subsidiaries
… …
Effective portion of changes
in fair value
Change in fair value
transferred to profit
or loss … … … …
Tax
… … … …
TOTAL COMPREHENSIVE
INCOME / (EXPENSE)
FOR THE YEAR
Transactions with owners:
Dividends paid … … …
-
-
-
-
-
-
-
-
Issue of shares … … …
16
Tax on equity-settled share-based
payment transactions …
Acquisition of NCI without
a change of control … …
Recycling of translation
reserve on the disposal
of subsidiary … … …
Reclassification
… …
-
-
-
-
-
(964)
-
-
-
-
(964)
-
-
-
-
(77)
358
-
-
-
-
-
-
-
-
-
253
-
-
-
-
-
-
-
-
-
7,866
7,866
474
8,340
-
(964)
(43)
(1,007)
(72)
(72)
-
(72)
(446)
(802)
522
(2)
398
87
-
-
-
(1,248)
50
(1,198)
920
85
(3)
(8)
917
77
74
(317)
7,794
6,587
470
7,057
-
-
-
-
-
-
-
-
-
-
-
-
(6,927)
(6,927)
-
-
-
-
(358)
16
253
-
(77)
-
-
-
-
(6,927)
16
253
(11)
(11)
-
-
(77)
-
BALANCE AT
30TH APRIL, 2020
736
361
5,244
(499)
(743) 99,918
105,017
4,585 109,602
The notes on pages 49 to 96 form part of these financial statements.
46
GOODWIN PLC
CONSOLIDATED BALANCE SHEET
at 30th April, 2021
NON-CURRENT ASSETS
… … … … … … …
Property, plant and equipment
… … … … … … … …
Right-of-use assets
Investment in associate
… … … … … … … …
Intangible assets… … … … … … … … … …
Derivative financial assets … … … … … … … …
Other financial assets at amortised cost … … … … … …
CURRENT ASSETS
Inventories… … … … … … … … … … …
Contract assets … … … … … … … … … …
Trade receivables and other financial assets … … … … …
Other receivables
… … … … … … … … …
Derivative financial assets … … … … … … … …
Cash and cash equivalents … … … … … … … …
FINANCIAL STATEMENTS
Notes
11
12
14
15
26
17
16
4
17
18
26
19
2021
£’000
77,063
3,691
829
24,813
191
-
2020
£’000
69,626
5,343
816
24,695
749
252
106,587
101,481
34,547
15,844
20,540
5,627
4,106
15,160
95,824
44,887
6,558
24,486
4,566
456
9,840
90,793
TOTAL ASSETS … … … … … … … … … …
202,411
192,274
CURRENT LIABILITIES
… … … … … … … … … …
Borrowings
Contract liabilities
… … … … … … … … …
Trade payables and other financial liabilities … … … … …
Other payables … … … … … … … … … …
Derivative financial liabilities … … … … … … … …
… … … … … … … …
Liabilities for current tax
… … … … … …
Provisions for liabilities and charges
NON-CURRENT LIABILITIES
Borrowings
… … … … … … … … … …
Derivative financial liabilities … … … … … … … …
Provisions for liabilities and charges
… … … … … …
Deferred tax liabilities … … … … … … … … …
TOTAL LIABILITIES… … … … … … … … … …
20
4
21
22
26
23
20
26
23
24
1,607
14,332
21,730
4,025
2,016
1,174
608
45,492
33,066
-
251
5,574
38,891
84,383
14,624
18,965
23,485
3,298
1,071
1,873
160
63,476
15,599
202
324
3,071
19,196
82,672
NET ASSETS … … … … … … … … … … …
118,028
109,602
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT
Share capital … … … … … … … … … …
Translation reserve … … … … … … … … …
Share-based payments reserve … … … … … … …
… … … … … … … …
Cash flow hedge reserve
… … … … … … … …
Cost of hedging reserve
… … … … … … … … …
Retained earnings
25
753
(852)
5,244
1,601
(1)
106,396
736
361
5,244
(499)
(743)
99,918
TOTAL EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT
113,141
105,017
NON-CONTROLLING INTERESTS … … … … … … …
4,887
4,585
TOTAL EQUITY
… … … … … … … … … …
118,028
109,602
These financial statements were approved by the Board of Directors on 11th August, 2021, and signed on its
behalf by:
T. J. W. Goodwin
Director
M. S. Goodwin
Director
S. R. Goodwin
Director
Company Registration Number: 305907
The notes on pages 49 to 96 form part of these financial statements.
47
FINANCIAL STATEMENTS
GOODWIN PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended 30th April, 2021
2021
£’000
2021
£’000
2020
£’000
CASH FLOW FROM OPERATING ACTIVITIES
Profit from continuing operations after tax
… … … …
Adjustments for:
Depreciation of property, plant and equipment … … …
Depreciation of right-of-use assets … … … … …
Amortisation and impairment of intangible assets
… …
Finance costs (net)… … … … … … … …
… … … … … …
Foreign exchange losses
(Profit) / loss on sale of property, plant and equipment … …
… … … … …
Profit on disposal of subsidiary
Share of profit of associate company
… … … …
… … … … … … … …
Tax expense
OPERATING PROFIT BEFORE CHANGES IN WORKING
CAPITAL AND PROVISIONS
Decrease in inventories … … … … … … …
Increase in contract assets … … … … … …
Decrease / (increase) in trade and other reservables … …
(Decrease) / increase in contract liabilities … … … …
Increase in trade and other payables… … … … …
Increase in unhedged derivative balances … … … …
CASH GENERATED FROM OPERATIONS
… … … … … … … …
Interest paid
Corporation tax paid … … … … … … …
NET CASH FROM OPERATING ACTIVITIES
… … …
13,006
5,696
972
1,566
640
292
(745)
(32)
(60)
3,508
24,843
10,344
(9,242)
2,885
(4,428)
1,047
(438)
25,011
(734)
(3,068)
21,209
2020
£’000
8,340
5,874
827
1,328
809
203
52
(172)
(66)
3,775
20,970
4,748
(2,863)
(2,549)
874
2,310
(980)
22,510
(844)
(2,493)
19,173
CASH FLOW FROM INVESTING ACTIVITIES
1,958
Proceeds from sale of property, plant and equipment
Acquisition of property, plant and equipment … … … (11,738)
-
Additional investment in existing subsidiaries … … …
… … … … …
Acquisition of intangible asset
(719)
(1,420)
… … … …
Development expenditure capitalised
…
139
(6,062)
(83)
(1,855)
(1,105)
NET CASH OUTFLOW FROM INVESTING ACTIVITIES … …
(11,919)
(8,966)
CASH FLOWS FROM FINANCING ACTIVITIES
17
Issue of shares … … … … … … … …
(1,635)
Payment of capital element of lease liabilities … … …
(6,016)
Dividends paid … … … … … … … …
(125)
Dividends paid to non-controlling interests
… … …
Proceeds from new loans… … … … … … …
35,048
Repayment of loans and committed facilities … … … (30,772)
16
(1,463)
(6,927)
-
7,658
-
NET CASH OUTFLOW FROM FINANCING ACTIVITIES
NET INCREASE IN CASH AND CASH EQUIVALENTS
Cash and cash equivalents at beginning of year … … …
… …
Effect of exchange rate fluctuations on cash held
(3,483)
5,807
9,449
(96)
CASH AND CASH EQUIVALENTS AT END OF YEAR (see note 19)
15,160
(716)
9,491
493
(535)
9,449
The notes on pages 48 to 96 form part of these financial statements.
48
NOTES TO THE FINANCIAL STATEMENTS
1. Accounting policies
Goodwin PLC (the “Company”) is incorporated in England and Wales.
The Group financial statements consolidate those of the Company and its subsidiaries (together referred to as
the “Group”) and equity account the Group’s interest in associates. The parent Company financial statements
present information about the Company as a separate entity and not about its Group.
The Group’s financial statements have been approved by the Directors and prepared in accordance with
international accounting standards in conformity with the requirements of the Companies Act 2006 and
international financial reporting standards adopted pursuant to Regulation (EC) No. 1606/2002 as it applies in
the European Union. The Company has elected to prepare its financial statements in accordance with Financial
Reporting Standard (FRS) 101 issued in the UK. These are presented on pages 85 to 96.
The accounting policies set out below have been applied consistently to all periods presented in these Group
financial statements.
Judgements made by the Directors, in the application of these accounting policies that have significant effect on
the financial statements and estimates with a significant risk of material adjustment in the next year are discussed
in note 2.
With the level of order input remaining high, the opportunity for continued profitability remains good for the next
twelve months. The impact of working capital requirements on our banking facilities given the expected level of
activity and capital spend commitments will continue to be monitored and managed. After reviewing the situation,
the Directors have a reasonable expectation that the Group has adequate resources to continue in operational
existence for twelve months from the date of approval of these financial statements and have continued to adopt
the going concern basis in preparing the financial statements. Going concern and viability of the Group are
discussed in detail within the Report of the Directors on pages 18 and 19 within these financial statements.
New IFRS standards and interpretations adopted during 2021
In 2021 the following amendments had been endorsed by the EU, became effective and were, therefore,
mandated to be adopted by the Group:
•
Amendments to IFRS 9, IAS39 and IFRS 7 – Interest rate benchmark reform phase 1 (effective for annual
periods beginning on or after 1st January 2020)
Amendments to IFRS 3 – Definition of a business (effective for annual periods beginning on or after
1st January 2020)
Amendments to IAS 1 and IAS 8 – Definition of material (effective for annual periods beginning on or after
1st January 2020)
Amendments to References to the Conceptual Framework in IFRS Standards (effective for annual periods
beginning on or after 1st January 2020)
•
•
•
The implementation of these standards and amendments has not had a material impact on the Group’s financial
statements.
Measurement convention
The financial statements are rounded to the nearest thousand pounds. The financial statements are based on
the historical cost basis except where the measurement of balances at fair value is required as below.
Going concern
The Directors, after having reviewed the projections and possible challenges that may lie ahead, believe that
there is a reasonable expectation that the Group has adequate resources to continue in operational existence
for at least twelve months from the date of approval of these financial statements, and have continued to
adopt the going concern basis in preparing the financial statements.
During April 2021, the Company repaid in full the £30 million drawn down from the Bank of England’s CCFF
scheme and having completed the refinancing of £10 million referred to within the 30th April, 2020 accounts,
currently has at its disposal £50.5 million of Bank facilities, £44.5 million of which are vested in long term
committed facilities.
The Directors have, as part of this going concern assessment, considered the ongoing impact of Covid-19 on the
Group’s operations. We are now more than eighteen months on from the onset of Covid-19 and whilst we
experienced a slow down in the Refractory Engineering segment of the business during March 2020 to August
2020, since then most of the entities in this division are seeing record levels of activity. As predicted when
writing the 30th April, 2020 going concern assessment, there has been little Covid-19 impact on the Mechanical
Engineering segment of the business. Whilst we have and are still seeing temporary impacts on our overseas
pump company operations, we are thankfully seeing minimal impact on Group activities as a result of the virus
pandemic.
Within our severe but plausible downside model, it is demonstrable that the Group has sufficient funds to
cover the Group’s and the Company’s financial commitments during the forecast period whilst remaining
compliant with its financial covenants. The downside model factors in adverse circumstances such as the loss
of a major customer and a new Covid-19 impact on our Refractory Engineering segment.
Since the end of the financial year, the Company has entered into a ten year interest rate swap agreement
which fixes our variable interest rate on borrowings at less than 1% for the entire period. The Directors see
49
NOTES TO THE FINANCIAL STATEMENTS
1. Accounting policies (continued)
Going concern (continued)
no shortage of investment opportunities in the coming years and so, given the historical low level of interest
rates, we deemed it prudent to remove the impact of higher interest rates from our risk modelling.
Whilst our carrying values of trade debtors and contract assets are significant, we see little risk here in terms
of recovery. We credit insure our debtors and pre credit risk (work in progress) and for significant contracts
where credit insurance is not available, we ensure where possible that these contracts are backed by letters of
credit or cash positive milestone payments.
As discussed elsewhere within these accounts, the Mechanical Engineering order book remains very high and
the Refractory Engineering segment is buoyant.
The Directors are confident that the Group and Company will have sufficient funds to continue to meet their
liabilities as they fall due for at least twelve months from the date of approval of the financial statements and
therefore have prepared the financial statements on a going concern basis.
Basis of consolidation
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or
indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with
the entity and has the ability to affect those returns through its power over the entity. The financial statements
of subsidiaries are included in the consolidated financial statements from the date that control commences
until the date that control ceases.
Associates are those entities in which the Group has significant influence, but not control, over the financial and
operating policies. Significant influence is presumed to exist when the Group holds between 20 and 50 percent
of the voting power of another entity. Associates are accounted for using the equity method and are initially
recognised at cost. The Group's investment includes goodwill identified on acquisition, net of any accumulated
impairment losses. The consolidated financial statements include the Group's share of the total recognised
income and expense and equity movements of equity accounted investees, from the date that significant
influence commences until the date that significant influence ceases. When the Group's share of losses
exceeds its interest in an equity accounted investee, the Group's carrying amount is reduced to nil and
recognition of further losses is discontinued except to the extent that the Group has incurred legal or
constructive obligations or made payments on behalf of an investee.
Foreign currency
The functional and presentational currency of the Group is GBP. Transactions in foreign currencies are translated
to the respective functional currencies of the Group entities at the foreign exchange rate ruling at the date of
the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are
translated at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation
are recognised in the statement of profit or loss within operating profit.
Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are
translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated
in foreign currencies that are stated at fair value are retranslated to the functional currency at foreign exchange
rates ruling at the dates the fair value was determined.
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on
consolidation, are translated to Sterling at foreign exchange rates ruling at the balance sheet date. The revenues
and expenses of foreign operations are translated at an average rate for the period where this rate approximates
to the foreign exchange rates ruling at the dates of the transactions.
Exchange differences arising from the translation of foreign operations are taken directly to the translation
reserve. They are released into the statement of profit or loss upon disposal of the foreign operation.
Financial instruments
Measurement
Trade receivables, which do not contain a significant financing component, are measured, initially, at the
transaction price. All other financial assets and liabilities are measured at fair value, on initial recognition.
Non-derivative financial assets are measured subsequently at amortised cost if the objective is to hold them
to collect contractual cash flows and their contractual terms include cash flows on specified dates, which are
payments of principal and interest.
Principal non-derivative financial assets
Trade receivables
Trade receivables are amounts due from customers for goods sold or services performed in the ordinary
course of business. They are recognised initially at the amount of consideration that is unconditional.
Trade receivables are held with the intention of collecting the contractual cash flows and are measured
subsequently, therefore, at amortised cost.
50
NOTES TO THE FINANCIAL STATEMENTS
1. Accounting policies (continued)
Financial instruments (continued)
Principal non-derivative financial assets and liabilities (continued)
Other receivables
Other receivables principally comprise short-term tax balances and a loan to an associate company. Interest
is charged at commercial rates on long-term balances. After being recognised initially at fair value, other
receivables are measured, subsequently, at amortised cost. The carrying amount of other receivables is
considered to be a reasonable approximation of their fair value.
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand, together with cash deposits with an original
maturity of three months or less. Included with cash and cash equivalents, for the cash flow statement
only, are bank overdrafts, which are repayable on demand and form an integral part of the Group’s cash
management.
Principal non-derivative financial liabilities
Bank borrowings
Interest-bearing bank loans and overdrafts are measured initially at their fair value less attributable transaction
costs. They are carried, subsequently, at amortised cost and finance charges are recognised in the statement
of profit or loss over the contract term, using an effective rate of interest.
Trade and other payables
Trade and other payables are recognised initially at fair value, and are subsequently reported at amortised cost.
Impairment
The Group has elected to measure loss allowances for trade receivables and contract assets at an amount
equal to lifetime expected credit losses (ECLs). Specific impairments are made when there is a known
impairment need against trade receivables and contract assets. When estimating ECLs, the Group assesses
reasonable, relevant and supportable information, which does not require undue cost or effort to produce.
This includes quantitative and qualitative information and analysis, incorporating historical experience,
informed credit assessments and forward-looking information. Loss allowances are deducted from the
gross carrying amount of the assets. Where material, impairment losses related to trade and other
receivables, including contract assets, are disclosed separately in the statement of profit or loss.
Derivative financial assets and liabilities
Derivative financial assets and liabilities are recognised at fair value. The fair value of forward exchange
contracts is equal to the present value of the difference between the contractual forward price and the current
forward price for the residual maturity of the contract adjusted for counterparty credit risk. The recognition
of the gain or loss on re-measuring to fair value those forward exchange contracts, which are used for hedging,
is outlined below; for other forward exchange contracts, the gain or loss is recognised in the profit or loss.
Fair value derivation
IFRS 7 requires that the classification of financial instruments at fair value be determined by reference to the
source of inputs used to derive the fair value. This classification uses the following three-level hierarchy:
Level 1 — quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2 — inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived from prices);
Level 3 — inputs for the asset or liability that are not based on observable market data (unobservable inputs).
The fair value of derivative financial assets and liabilities is derived using level 2 inputs. As at the year-end,
the Group held only currency derivatives, with the valuations based on the period end currency rates,
as adjusted for the forward points to maturity, the time value of money and the banks’ assessed credit
risk and margin.
Cash flow hedges
Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised
asset or liability, or a highly probable forecast transaction, the effective part of any gain or loss on the derivative
financial instrument is recognised directly in the hedging reserve. Our hedge relationships are aligned with
our risk management objectives and strategy, resulting in a more qualitative and forward-looking approach in
ensuring hedge effectiveness.
For cash flow hedges, the associated cumulative gain or loss on the relevant derivative financial instrument is
removed from equity and recognised in the statement of profit or loss in the same period or periods during which
the hedged forecast transaction affects the statement of profit or loss. Any identified ineffective portion of the
hedge is recognised immediately in the statement of profit or loss. Only the change in spot rate is designated
as the hedging instrument, with the change in fair value relating to forward points being reported separately as
deferred costs of hedging within other comprehensive income as permitted by IFRS 9.
51
NOTES TO THE FINANCIAL STATEMENTS
1. Accounting policies (continued)
Cash flow hedges (continued)
When a hedging instrument expires or is sold, terminated or exercised, or the entity revokes designation of the
hedge relationship but the hedged forecast transaction is still expected to occur, the cumulative gain or loss at
that point remains in equity and is recognised in accordance with the above policy when the transaction occurs.
If the cash flow hedge transaction is no longer expected to take place, the cumulative unrealised gain or loss
recognised in equity is recognised in the statement of profit or loss immediately, within cost of sales.
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses.
Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as
separate items of property, plant and equipment.
Depreciation is charged to the statement of profit or loss over the estimated useful lives of each part of an item
of property, plant and equipment on the following bases:
• Freehold land
… … … …
• Freehold buildings … … … …
• Leasehold property
… … …
• Plant and machinery
… … …
• Motor vehicles
… … … …
• Tooling
… … … … …
• Other equipment … … … …
Assets in the course of construction are not depreciated.
Nil
2% to 4% on reducing balance or cost
over period of lease
5% to 25% on reducing balance or cost
15% or 25% on reducing balance
over estimated production life
15% to 25% on reducing balance or cost
Intangible assets and goodwill
All business combinations are accounted for by applying the purchase method. Goodwill represents amounts
arising on acquisition of businesses. In respect of business acquisitions that have occurred since 1st May, 2006,
goodwill represents the difference between the cost of the acquisition and the fair value of the identifiable net
assets acquired. For acquisitions prior to the adoption of Revised IFRS 3 “Business Combinations” (1st May,
2010), cost includes directly attributable acquisition costs. For acquisitions after this date, such costs are
charged to the statement of profit or loss. Identifiable intangibles are those which can be sold separately or
which arise from legal rights regardless of whether those rights are separable.
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash-generating
units and is not amortised but is tested annually for impairment.
Negative goodwill arising on an acquisition is recognised immediately in the statement of profit or loss.
Goodwill or negative goodwill resulting from increasing the percentage ownership of an existing subsidiary is
dealt with in other comprehensive income.
Expenditure on research activities is recognised in the statement of profit or loss as an expense as incurred.
Expenditure on development activities is capitalised if the product or process is technically and commercially
feasible and the Group has sufficient resources to complete development. The expenditure capitalised
includes the cost of materials, direct labour and an appropriate proportion of overheads. Other development
expenditure is recognised in the statement of profit or loss as an expense as incurred. Capitalised development
expenditure is stated at cost less accumulated amortisation and impairment losses.
Other intangible assets that are acquired by the Group are stated at cost less accumulated amortisation and
impairment losses.
Amortisation is charged to the statement of profit or loss on a straight-line basis over the estimated useful lives
of intangible assets unless such lives are indefinite. Intangible assets with an indefinite useful life and
goodwill are systematically tested for impairment at each balance sheet date. Other intangible assets are
amortised from the date they are available for use. The estimated useful lives are as follows:
• Capitalised development costs
Minimum expected order unit intake or minimum product life
• Manufacturing rights
6 - 15 years
• Brand names and intellectual property 3 - 20 years
• Customer lists
2 - 10 years
• Order book
1 year
• Distribution rights
25 years
• Software and licences
3 - 5 years
• Non-compete agreements
15 years
Impairment of intangibles
The carrying amounts of the Group’s assets are reviewed at each balance sheet date to determine whether
there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated.
Recoverable amount is the greater of an asset’s or cash-generating unit’s fair value less costs to sell or value
in use.
For goodwill, assets that have an indefinite useful life and intangible assets that are not yet available for use, the
52
NOTES TO THE FINANCIAL STATEMENTS
1. Accounting policies (continued)
Impairment of intangibles (continued)
recoverable amount is estimated at each balance sheet date.
An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds
its recoverable amount. Impairment losses are recognised in the statement of profit or loss.
Reversals of impairment
An impairment loss in respect of goodwill is not reversed.
In respect of other assets, an impairment loss is reversed when there is an indication that the impairment loss
may no longer exist and there has been a change in the estimates used to determine the recoverable amount.
An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying
amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been
recognised.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is based on the first-in, first-out principle
and includes expenditure incurred in acquiring the inventories and bringing them to their existing location and
condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of
overheads based on normal operating capacity.
Government grants
Government grants relating to income are recognised in the statement of profit or loss.
Government grants relating to assets are recognised in the balance sheet as a deduction in the carrying amount
of the asset. Depreciation is charged on the value of the asset less the associated grant.
Provisions
General provisions
A provision is recognised in the balance sheet when the Group has a present legal or constructive obligation
as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the
obligation. 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.
Warranty provisions
The Group carries a warranty provision where applicable. The warranties are committed at contract placement
stage and typically, where given to a customer, the warranty has a duration of between 1 and 3 years. At the
expiry of the warranty period, to the extent not utilised the warranty provision is then released back into the
statement of profit or loss. The warranties are generally passive in nature confirming that the goods comply
with contractual specifications and given the incidence of product failure is low, the warranties have no
tangible customer value.
Revenue
Revenue is recognised when a customer obtains control of the goods or services i.e. upon the satisfaction of a
performance obligation. Judgement is required to determine the timing of the transfer of control, and whether
it is at a point in time or over time. Where a contract contains several performance obligations then the contract
is unbundled and each performance obligation is dealt with separately.
Standard inventory product lines and consumables
Typically applies to the whole of the Group’s Refractory Engineering segment and the sale of slurry pumps
within the Mechanical Engineering segment. The revenue here relates to standard products manufactured for
sale. The performance obligation is satisfied and revenue recognised at the point when customers obtain
control of the goods in accordance with the International Commercial (INCO) terms agreed or via a bill and
hold arrangement.
Minimum period contracts for the provision of goods and services
Predominantly the supply of broadband and related services under minimum term contracts. Performance
obligations are satisfied over time and revenue is recognised equally over the term of the contract
Engineered bespoke products – performance obligations satisfied over time
Typically applies to the Group’s Mechanical Engineering segment and covers sales orders which are customer
bespoke, but permit the Group subsidiary to claim profit earned to date if the customer were to trigger the cancel
for convenience clause within the contract. In such cases, the performance obligations are treated as satisfied
over time (i.e. as the contract progresses) and revenue is taken based on the percentage completion of the
contract by the creation of a contract asset. Work in progress is eliminated and replaced by a contract asset.
Measuring progress requires judgement as to the stage of completion of each job, and the production of
forecasts, which contain allowances for technical risks and inherent uncertainties.
53
NOTES TO THE FINANCIAL STATEMENTS
1. Accounting policies (continued)
Revenue (continued)
Engineered bespoke products – performance obligations satisfied at a point in time
Typically applies to the Group’s Mechanical Engineering segment and covers sales orders which are customer
bespoke, but permit the Group subsidiary to claim only for costs in the event the customer triggers the cancel
for convenience clause within the contract. In such cases, the performance obligation is deemed to be met
and revenue taken as order lines are shipped in accordance with the relevant shipping terms or via a bill and
hold arrangement, whereby control passes to the customer, once the invoice has been raised.
The incremental costs of obtaining a contract are recognised as an expense, as occurred, when the contract
period is less than one year.
Contract assets represent the Group’s rights to consideration for work completed but not invoiced at the
reporting date for bespoke product contracts where, as part of the contract terms, there is a termination for
convenience clause which, if invoked, allows the Group company to charge for profit earned to date. Contract
assets are transferred to receivables when the rights to consideration become unconditional, which is generally
when the Group invoices the customer. Where payments are received in advance and exceed the costs
incurred in constructing the asset together with forecast margin earned, the balances are disclosed as
contract liabilities.
the contract involves the use of an identified asset;
the Group has the right to obtain substantially all of the economic benefit of using the asset; and
the Group has the right to direct the use of the asset by deciding how the asset is employed.
Leases
Definition of a lease
A contract is a lease or contains a lease if it transfers the right to use an identified asset over the contract
term, in exchange for payment. In determining whether a contract gives the Group the right to use an asset,
the Group assesses whether:
•
•
•
Lease term
The lease term is the non-cancellable period of a lease, and options to extend the lease or terminate it, where it
is probable that the Group will exercise the available options. At the start of a lease, the Group makes a judgement
about whether it is reasonably certain to exercise the options, and reassesses this judgement at every reporting
period. Contracts, where the original lease term has expired, with assets continuing to be leased on a short-term
rolling basis of a few months, are treated as short-term leases.
Lease balances
A right-of-use asset and a lease liability are calculated at the beginning of a lease. The right-of-use asset is
measured initially at cost, being the opening lease liability, adjusted for any lease payments made by the start
of the lease, adjusted for any initial direct costs, which have been incurred.
The lease liability is measured initially at the present value of the lease payments, which are outstanding at the
start date, discounted at either the rate implicit in the lease or the Group’s incremental borrowing rate. With the
exception of leases containing an option to purchase, the Group uses its incremental borrowing rate as the
discount rate. Lease liabilities are measured at amortised cost, using the effective rate, and adjusted as
required for any subsequent change to the lease terms.
The right-of-use asset is depreciated on a straight-line basis over the lease term, or from the start date of the
lease to the end of the useful life of the right-of-use asset as appropriate. The method of calculating the
estimated useful lives of the right-of-use assets and testing for impairment is the same as that for property,
plant and equipment.
Recognition exemptions
Payments for short-term leases, lasting twelve months or less, without a purchase option continue to be
reported as an operating expense on a straight-line basis over the term of the lease.
The cost of leasing low-value items will continue to be reported as an operating expense over the life of the lease.
Lease portfolios
The Group has leases for the following types of assets:
Land and buildings – the Group leases a number of factory buildings, warehouses and office buildings.
Plant and equipment – a number of significant items of plant, such as CNC machines and furnaces, have been
leased under contracts with an option to buy the asset at the end of the lease term. The Group also leases motor
vehicles. For motor vehicles the Group has applied the practical expedient in paragraph 15 of IFRS 16, whereby
non-lease components have not been separated from lease components, such that lease costs and service
costs are treated as a single lease component.
Printers and photocopiers – the Group has applied the recognition exemption for low-value assets to these leases.
54
NOTES TO THE FINANCIAL STATEMENTS
1. Accounting policies (continued)
Financial income and costs
Financial expenses comprise interest payable, interest on lease liabilities using the effective interest method
together with the amortisation of any facility arrangement fees. Borrowing costs that are directly attributable
to the acquisition, construction or production of an asset that takes a substantial time to be prepared for use
are capitalised as part of the cost of that asset.
Interest income and interest payable is recognised in the statement of profit or loss as it accrues.
Employment costs
Pension costs
The Group contributes to a defined contribution pension scheme for UK employees under an Auto Enrolment
Pension arrangement as required by Government legislation. The assets of the scheme are held in independently
administered funds. Group pension costs are charged to the statement of profit or loss in the year for which
contributions are payable.
Contributions to the schemes are made on a monthly basis and at the end of the financial year there were one
month’s contributions outstanding, which were paid in the following month.
Termination costs
Employee termination costs are expended in the profit and loss figures in a year as soon as the expense is known
and is certain.
Share-based payment transactions
Share-based payments arrangements, in which the Group receives goods or services as consideration for its own
equity instruments, are accounted for as equity-settled share-based payment transactions, regardless of how
the equity instruments are obtained by the Group.
The grant date fair value of share-based payment awards granted to employees is recognised as an expense,
with a corresponding increase in equity, over the period in which the employees become unconditionally
entitled to the awards. The fair value of the awards is measured using an option valuation model, taking into
account the terms and conditions upon which the awards were granted.
Taxation
Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the statement of
profit or loss except to the extent that it relates to items recognised directly in equity, in which case it is recognised
in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively
enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for taxation purposes. The following temporary differences
are not provided for: the initial recognition of goodwill, the initial recognition of assets or liabilities that affect
neither accounting nor taxable profit other than in a business combination, and differences relating to investments
in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred
tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and
liabilities, using tax rates enacted or substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available
against which the asset can be utilised.
New IFRS standards, amendments and interpretations not adopted
The IASB and IFRIC have issued additional standards and amendments which are effective for periods starting
after the date of these financial statements. The following standards and amendments have not yet been
adopted by the Group:
•
Amendments to IFRS 9, IAS39, IFRS 7, IFRS 4 and IFRS 16 – Interest rate benchmark reform phase 2 (effective
for annual periods beginning on or after 1st January 2021)
Amendments to IAS 16 – Property, plant and equipment: proceeds before intended use (effective for
annual periods beginning on or after 1st January 2022)
•
The Group has considered the impact of these new standards and interpretations in future periods on profit,
earnings per share and net assets and none are expected to result in a material impact.
2. Accounting estimates and judgements
The Group makes judgements and estimates in applying the Group’s accounting policies, to prepare the
financial statements. The Directors do not believe there have been any key judgements exercised during the
period, but see the following as the key estimates considered.
Key estimates and judgements
IFRS 15 Revenue Recognition
The Directors consider that a key estimate, which may have a material impact on the financial statements, is in
relation to IFRS 15 and, in particular, where we are mandated to account on a revenue over time basis on some
55
NOTES TO THE FINANCIAL STATEMENTS
2. Accounting estimates and judgements (continued)
Key estimates and judgements (continued)
IFRS 15 Revenue Recognition (continued)
of our mechanical engineering work in progress contracts. When reviewing the terms of contracts with customers,
judgement is required to assess the number of performance obligations within the contracts and when to
recognise contract provisions.
For contracts where revenue is recognised over time, there is a need to estimate the costs to complete on these
contracts. The costs to complete estimates can be complex, as they need to consider several variable factors
such as the impact of delays, cost overruns and also any variations to contract. Once complete, these estimates
then drive the amount of revenue recognised. The estimates are prepared and reviewed by management with
suitable experience and qualifications, and who endeavour to ensure the revenue mandated to be recognised
prior to the completion of the contract is not overstated, based on possible technical risks and inherent
uncertainties.
Whilst cost to complete estimates are based on management’s best knowledge at the time, it is clear, due to
the very nature of an estimate that the eventual outcomes may differ due to unforeseen events. However, the
advanced stage of completion of a number of contracts reduces the risk of unforeseen events arising, and
given that the initial position taken on material contracts at the balance sheet date are revisited as part of
the post balance sheet review process prior to the financial statements being signed off, we would conclude
that the risk of a material impact on the financial statements arising here is low.
Determination of the basis for the amortisation / impairment of intangible assets
The Group carries different classes of intangible assets on its balance sheet, which include goodwill,
manufacturing rights, brand names and development costs. Capitalised intangible costs are amortised on a
straight-line basis, which commences when the Group is expected to benefit from cash inflows. A key estimate
is required in determining the useful economic life over which each asset is to be amortised, with current
timeframes ranging from fifteen to twenty-five years. In arriving at the appropriate timeframe for amortisation,
there are essentially two key estimates, namely the product life cycle and the amount of profit generated
from the expected income streams. In terms of sensitivity, then, in regard to the intangible assets other than
goodwill, if we were to assume assets with estimated useful lives of fifteen years or more were reduced by
one third, then the pre tax profit and loss impact on the current year reported figures would be to reduce
profits by £481,000 (2020: £656,000). In accordance with IAS 38, the basis on which goodwill / intangible assets
are amortised / impaired is assessed annually. Sensitivity as regards goodwill is considered within note 15
to these financial statements.
Apart from above, the Group does not have any key assumptions concerning the future, or other key sources
of estimation uncertainty in the reporting period that may have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within the next financial year.
Other estimates / judgements
Other than as reported above, the Directors do not consider there to be any key estimates or judgements in
preparing the financial statements. The estimates and judgements outlined below formed the main areas of
focus for the Directors throughout the year.
Inventory provisions
The Group's Directors in conjunction with senior management in the subsidiaries regularly review the
recoverability of their stated raw material and work in progress balances, paying particular attention to net
realisable value and stock obsolescence issues. The estimates are in relation to costs to complete and the
expected level of future sales orders for slow moving stocks. Where it is judged that a provision is deemed
necessary the appropriate adjustments are made in the relevant subsidiary's books at the time a shortfall is
identified.
Trade receivable provisions
Whilst trade debtors are insured wherever possible, the Directors are able to exercise judgement in relation to
non-credit insured contracts as set out in note 26(a). The Group Directors, in conjunction with the subsidiary credit
controllers, closely monitor the adherence to payment terms across all accounts (whether insured or not) and
make provision for any losses that are likely to materialise. There is a requirement under IFRS 9 to consider the
statistical likelihood of a bad debt based off previous experience. Historically, the Group’s bad debt write offs have
been negligible and the Group results are not impacted by this requirement for a statistically based provision.
3. Segmental information
Products and services from which reportable segments derive their revenues
For the purposes of management reporting to the chief operating decision maker, the Board of Directors, the
Group is organised into two reportable operating divisions: mechanical engineering and refractory engineering.
Segment assets and liabilities include items directly attributable to segments as well as those that can be allocated
on a reasonable basis. Associates are included in refractory engineering. In accordance with the requirements of
IFRS 8, information regarding the Group’s operating segments is reported on the opposite page.
56
NOTES TO THE FINANCIAL STATEMENTS
3. Segmental information (continued)
Products and services from which reportable segments derive their revenues (continued)
Year Ended 30th April
Revenue
Mechanical
Engineering
Refractory
Engineering
Sub Total
2021
£’000
2020
£’000
2021
£’000
2020
£’000
2021
£’000
2020
£’000
External sales … … … …
86,616
100,078
Inter-segment sales … … …
20,871
25,821
44,615
11,526
44,434
131,231
144,512
8,361
32,397
34,182
Total revenue … … … …
107,487
125,899
56,141
52,795
163,628
178,694
Reconciliation to consolidated revenue:
Inter-segment sales … … …
Consolidated revenue for the year
Year Ended 30th April
Profits
Operating profit including share
(32,397)
(34,182)
131,231
144,512
Mechanical
Engineering
Refractory
Engineering
Sub Total
2021
£’000
2020
£’000
2021
£’000
2020
£’000
2021
£’000
2020
£’000
of associates … … … …
10,823
8,065
9,340
7,034
20,163
15,099
% of total operating profit including
share of associates … … …
Group centre … … … …
Group finance expenses … …
Consolidated profit before
tax for the year … … …
Tax
… … … … …
Consolidated profit after
tax for the year … … …
Year Ended 30th April
Segmental net assets
54%
53%
46%
47%
100%
100%
(3,009)
(2,175)
(640)
(809)
16,514
12,115
(3,508)
(3,775)
13,006
8,340
Segmental
total assets
2021
£’000
2020
£’000
Segmental
total liabilities
2021
£’000
2020
£’000
Segmental
net assets
2021
£’000
2020
£’000
Mechanical Engineering … …
Refractory Engineering
… …
92,929
44,114
95,193
41,962
66,909
20,591
72,207
22,850
26,020
23,523
22,986
19,112
Sub total reportable segment …
137,043
137,155
87,500
95,057
49,543
42,098
Goodwin PLC net assets … …
Elimination of Goodwin PLC investments
Goodwill
… … … …
Consolidated total net assets
…
83,998
(25,392)
9,879
83,415
(25,801)
9,890
118,028
109,602
57
NOTES TO THE FINANCIAL STATEMENTS
3. Segmental information (continued)
The investment in associate of £829,000 (2020: £816,000) is reported within the refractory engineering total
assets. For the purposes of monitoring segment performance and allocating resources between segments, the
Group’s Board of Directors monitors the tangible and financial assets attributable to each segment. All assets
and liabilities are allocated to reportable segments with the exception of those held by the parent Company,
Goodwin PLC, and those held as consolidation adjustments.
Segmental capital expenditure
Property, plant
and equipment
Right-of-use
assets
Intangible
assets
Total
Year Ended 30th April
2021
£’000
Goodwin PLC … … 5,315
2020
£’000
2,824
2021
£’000
1,180
2020
£’000
-
2021
£’000
151
2020
£’000
2,333
2021
£’000
6,646
2020
£’000
5,157
Mechanical
Engineering … … 4,952
2,511
1,146
156
1,123
613
7,221
3,280
Refractory
Engineering … … 1,570
633
74
1,033
456
633
2,100
2,299
11,837
5,968
2,400
1,189
1,730
3,579
15,967
10,736
Segmental depreciation, amortisation and impairment
Year Ended 30th April
Goodwin PLC … … … …
Mechanical Engineering … …
Refractory Engineering
… …
Depreciation
Amortisation and
impairment
Total
2021
£’000
2,970
2,346
1,352
2020
£’000
2,934
2,369
1,398
2021
£’000
1,106
20
440
2020
£’000
708
97
523
2021
£’000
4,076
2,366
1,792
2020
£’000
3,642
2,466
1,921
6,668
6,701
1,566
1,328
8,234
8,029
Geographical segments
The Group operates in the following principal locations.
In presenting the information on geographical segments, revenue is based on the location of its customers and
assets on the location of the assets.
Year ended 30th April, 2021
Year ended 30th April, 2020
Revenue
£’000
39,755
21,473
8,027
28,255
33,721
UK
Rest of Europe
USA
Pacific Basin
Rest of World
Opera-
tional
net
assets
£’000
Non-
Capital
current expendi-
ture
£’000
assets
£’000
81,982
89,944
13,634
8,309
3,264
-
13,708
14,029
-
6,499
6,880
279
-
719
1,335
Opera-
tional
net
assets
£’000
76,467
8,346
-
13,513
11,276
Non-
current
assets
£’000
84,198
3,439
-
7,132
6,712
Capital
expendi-
ture
£’000
8,681
207
-
1,248
600
Revenue
£’000
39,609
20,004
12,749
34,844
37,306
Total
131,231
118,028
106,587
15,967
144,512
109,602
101,481
10,736
Of the £21,473,000 (April 2020: £20,004,000) sales to the rest of Europe, £8,366,000 (April 2020: £5,975,000),
relate to the European sales of our German-domiciled subsidiary, Noreva GmbH.
58
NOTES TO THE FINANCIAL STATEMENTS
4. Revenue
The following tables provide an analysis of revenue by geographical market and by product line.
Geographical market
Year ended 30th April, 2021
Year ended 30th April, 2020
Mechanical
Refractory
Engineering Engineering
£’000
£’000
Mechanical
Refractory
Total Engineering Engineering
£’000
£’000
£’000
11,497
39,755
6,350
21,473
431
8,027
17,356
28,255
8,981
33,721
29,187
13,088
12,664
16,361
28,778
10,422
6,916
85
18,483
8,528
44,615 131,231
100,078
44,434
144,512
Total
£’000
39,609
20,004
12,749
34,844
37,306
UK
Rest of Europe
USA
Pacific Basin
Rest of World
Total
Product lines
28,258
15,123
7,596
10,899
24,740
86,616
Year ended 30th April, 2020
Year ended 30th April, 2019
Mechanical
Refractory
Engineering Engineering
£’000
£’000
Mechanical
Refractory
Total Engineering Engineering
£’000
£’000
£’000
Standard products and consumables 10,630
44,615
55,245
Bespoke products – point in time
11,203
-
11,203
9,545
25,427
44,434
-
Total
£’000
53,979
25,427
Point in time revenue
21,833
44,615
66,448
34,972
44,434
79,406
Minimum period contracts
Bespoke products – over time
Over time revenue
3,306
61,477
64,783
-
-
-
3,306
61,477
4,143
60,963
64,783
65,106
-
-
-
4,143
60,963
65,106
Total revenue
86,616
44,615 131,231
100,078
44,434
144,512
The following table presents information about receivables, contract assets and liabilities from contracts with
customers.
2021
£’000
2020
£’000
Trade receivables (note 17) … … … … … … … … … …
… … … … … … … … … … …
Contract assets
Contract liabilities … … … … … … … … … … …
19,378
15,844
(14,332)
23,589
6,558
(18,965)
Revenue recognised in the year, which was included in the contract liability balance at the beginning of the
period, totalled £9,710,000 (2020: £9,495,000).
Revenue of £387,000 (2020: £Nil) has been recognised from performance obligations, which were satisfied (or
partially satisfied) in previous periods.
The Group has applied the practical expedient in IFRS 15, paragraph 121, and has not disclosed the
remaining performance obligations for contracts which have an original expected duration of one year or less.
The aggregate amount of the transaction price allocated to the performance obligations for longer-term
contracts, which are unsatisfied (or partially unsatisfied) as at the end of the reporting period is shown below.
20,890
11,182
Performance obligations due to be satisfied within one year … … … …
Performance obligations due to be satisfied after more than one year … … …
2021
£’000
33,216
14,855
2020
£’000
19,585
45,586
48,071
65,171
Incremental costs of obtaining contracts lasting less than one year, are recognised as an expense, when incurred,
in accordance with the practical expedient in IFRS 15, paragraph 94. The impairment charge for contract assets
was £2,235,000 (2020: £2,218,000).
The Group’s revenue is not significantly impacted by seasonal or cyclical events. The potential risk of the loss
of any key customer is limited as, typically, no single customer accounts for more than 10% of annual turnover.
59
NOTES TO THE FINANCIAL STATEMENTS
5. Expenses and auditor’s remuneration
Included in profit before taxation are the following:
Charged / (credited) to the statement of profit or loss
… … … … … … … … …
Insurance claim proceeds
Profit on sale of property
… … … … … … … … …
Write back of deferred consideration … … … … … … … …
Depreciation:
Owned assets … … … … … … … … … … …
Right-of-use assets (see below) … … … … … … … …
Amortisation and impairment of intangible assets
… … … … …
Loss on sale of other tangible fixed assets … … … … … … …
Profit on disposal of subsidiary
… … … … … … … …
Research expenditure … … … … … … … … … …
…
Impairment of trade receivables charged to the statement of profit or loss
Foreign exchange (gains) / losses … … … … … … … …
Mark to market derivative gains
… … … … … … … …
Fees receivable by the auditor and the auditor’s associates in respect of:
Audit of these financial statements … … … … … … …
Audit of the financial statements of subsidiaries … … … … …
Expenses relating to short-term property leases … … … … … …
Expenses relating to short-term plant and equipment leases … … … …
Expenses relating to leases of low-value assets … … … … … …
Government grants received including Covid-19 support … … … …
Depreciation on right-of-use assets may be analysed as follows:
Right of use assets depreciation – finance leases (IAS 17 definition)
… …
Right of use assets depreciation – operating leases (IAS 17 definition) … …
Depreciation – right of use assets … … … … … … … …
6. Staff numbers and costs
2021
£’000
-
(763)
-
5,696
972
1,566
18
(32)
4,185
319
(686)
(438)
63
188
268
142
14
(1,427)
£’000
422
550
972
2020
£’000
(690)
-
(204)
5,874
827
1,328
52
(172)
306
49
1,465
(980)
120
271
380
121
20
(227)
£’000
290
537
827
The average number of persons employed by the Group (including Directors) during the year, analysed by
category, was as follows:
Number of employees
2020
2021
Subsidiary employees … … … … … … … … … …
Goodwin PLC company employees … … … … … … … …
The aggregate payroll costs of these persons were as follows:
Wages and salaries … … … … … … … … … …
Social security costs… … … … … … … … … …
Other pension costs … … … … … … … … … …
1,080
49
1,129
2021
£’000
38,577
4,976
1,320
44,873
1,139
51
1,190
2020
£’000
38,633
4,027
1,581
44,241
Of the total staff costs £31,522,000 (2020: £32,204,000) are reported within cost of sales, and £13,351,000 (2020:
£12,037,000) are reported within administrative expenses.
Details of the Directors’ remuneration can be found within the Directors Remuneration Report on pages 29 and
30. The emoluments of the highest paid Director were £355,000 (2020: £310,000). The number of Directors, who
were members of a defined contribution pension scheme, was 6 (2020: 6).
60
NOTES TO THE FINANCIAL STATEMENTS
2021
£’000
111
95
747
(91)
751
640
2020
£’000
122
97
874
(40)
931
809
£’000
£’000
7. Finance costs (net)
Interest income … … … … … … … … … … …
Interest expense on lease liabilities … … … … … … … …
Interest expenses on bank loans and overdrafts … … … … … …
Capitalised interest on fixed asset projects … … … … … … …
Interest expense … … … … … … … … … … …
Finance costs (net)… … … … … … … … … … …
Interest on right-of-use assets may be analysed as follows:
Interest on lease liabilities – finance leases (IAS 17 definition)
… … …
Interest on lease liabilities – operating leases (IAS 17 definition) … … …
Interest expense on lease liabilities … … … … … … … …
8. Taxation
Recognised in the statement of profit or loss
Current tax expense
Current year … … … … … … … … … … …
Over provision in prior years … … … … … … … …
Deferred tax expense
Origination and reversal of temporary differences – current year
Origination and reversal of temporary differences – over provision in prior years
Origination and reversal of temporary differences – rate change to prior year
… …
Total tax expense … … … … … … … … … … …
Reconciliation of effective tax rate
44
51
95
2021
£’000
1,878
(128)
1,750
1,845
(87)
-
1,758
3,508
2021
£’000
Profit before taxation … … … … … … … … … …
16,514
Tax using the UK corporation tax rate of 19.00% (2020: 19.00%) … … …
… … … … … … … … … …
Non-taxable income
Non-deductible expenses
… … … … … … … … …
Other permanent timing differences … … … … … … … …
Over provision in prior years … … … … … … … … …
Losses not recognised … … … … … … … … … …
Share-based payments … … … … … … … … … …
Losses utilised where a deferred tax asset was not recognised
… … …
Rate change to prior year
… … … … … … … … …
Withholding tax unrelieved … … … … … … … … …
… … … … … … … …
Difference in overseas tax rates
Effect of equity accounting for associate … … … … … … …
3,138
(45)
33
309
(210)
133
59
(115)
-
108
113
(15)
Total tax expense … … … … … … … … … … …
3,508
Where subsidiary companies have incurred losses in the year, which are unlikely to be relieved against future
profits in the next twelve months, deferred tax assets are not recognised.
Withholding tax unrelieved represents withholding tax deducted on dividends from overseas subsidiaries and
associates.
Deferred tax recognised directly in equity
The following amounts are included in the consolidated statement of:
Cash flow hedge deferred tax (charge) / credit … … … … … …
61
2021
£’000
(673)
2020
£’000
77
41
56
97
2020
£’000
1,985
(62)
1,923
1,531
(50)
371
1,852
3,775
2020
£’000
12,115
2,302
(57)
116
214
(112)
114
-
-
371
36
805
(14)
3,775
9. Earnings per share
NOTES TO THE FINANCIAL STATEMENTS
Number of
ordinary shares
2021
£’000
2020
£’000
Ordinary shares in issue
Balance at 1st May, 2020 (1st May, 2019) … … … … … … … 7,363,200
7,200,000
Shares issued in the year (note 33) … … … … … … … …
163,200
163,200
7,526,400
7,363,200
Outstanding ordinary share options (note 33)
… … … … …
163,200
326,400
Total ordinary shares (issued and options) … … … … … … 7,689,600
7,689,600
Weighted average number of ordinary shares in issue … … … … … 7,445,024
7,288,289
Weighted average number of outstanding ordinary share options … … …
162,651
325,365
Denominator used for diluted earnings per share calculation … … 7,607,675
7,613,654
Relevant profits attributable to ordinary shareholders … … … … …
12,494
2021
£’000
10. Dividends
Paid ordinary dividends during the year in respect of prior years
81.71p (2019: 96.21p) per qualifying ordinary share … … … … …
2021
£’000
6,016
2020
£’000
7,866
2020
£’000
6,927
After the balance sheet date an ordinary dividend of 102.24p per qualifying ordinary share was proposed by
the Directors (2020: Ordinary dividend of 81.71p).
The proposed current year ordinary dividend of £7,862,000 has not been provided for within these financial
statements (2020: Proposed ordinary dividend of £6,016,000 was not provided for within the comparative
figures).
62
NOTES TO THE FINANCIAL STATEMENTS
11. Property, plant and equipment
Cost
Land and
buildings machinery
£’000
Other
Plant and equipment
**
£’000
£’000
Balance at 1st May, 2019 … … …
Additions … … … … … …
Reclassification … … … … …
Disposals … … … … … …
Transfer to right-of-use assets on
transition to IFRS 16… … … …
Exchange adjustment … … … …
41,808
206
91
(34)
-
(400)
76,528
3,843
5,173
(1,632)
(4,648)
(305)
3,949
158
(744)
(68)
-
(17)
Assets in
course of
construc-
tion
£’000
4,767
1,761
(4,520)
-
Total
£’000
127,052
5,968
-
(1,734)
-
(2)
(4,648)
(724)
Balance at 30th April, 2020 … …
41,671
78,959
3,278
2,006
125,914
Balance at 1st May, 2020 … … …
Additions … … … … … …
Reclassification – others … … …
Reclassification – ROU*
… … …
Disposals … … … … … …
Exchange adjustment … … … …
41,671
1,397
74
-
(641)
(503)
78,959
3,906
(3,888)
4,045
(1,221)
(222)
3,278
486
4,002
-
(747)
(64)
2,006
6,048
(188)
-
(75)
(12)
125,914
11,837
-
4,045
(2,684)
(801)
Balance at 30th April, 2021 … …
41,998
81,579
6,955
7,779
138,311
Depreciation
Balance at 1st May, 2019 … … …
Charged in year … … … … …
Reclassification … … … … …
Disposals … … … … … …
Transfer to right-of-use assets on
transition to IFRS 16… … … …
Exchange adjustment … … … …
7,035
1,209
36
(2)
-
(128)
43,147
4,425
595
(1,498)
(693)
(177)
2,764
240
(631)
(43)
-
9
Balance at 30th April, 2020 … …
8,150
45,799
2,339
Balance at 1st May, 2020 … … …
Charged in year … … … … …
Reclassification – others … … …
Reclassification – ROU*
… … …
Disposals … … … … … …
Exchange adjustment … … … …
8,150
1,195
-
-
-
(119)
45,799
4,004
(3,032)
1,045
(812)
(147)
2,339
497
3,032
-
(659)
(44)
Balance at 30th April, 2021 … …
9,226
46,857
5,165
-
-
-
-
-
-
-
-
-
-
-
-
-
-
52,946
5,874
-
(1,543)
(693)
(296)
56,288
56,288
5,696
-
1,045
(1,471)
(310)
61,248
Net book value
At 1st May, 2019
… … … …
34,773
33,381
At 30th April, 2020 and 1st May, 2020 …
33,521
33,160
1,185
939
4,767
2,006
74,106
69,626
At 30th April, 2021
… … …
32,772
34,722
1,790
7,779
77,063
* This is a transfer from the right-of-use assets category on the settlement of a lease purchase agreement and
payment of the option to purchase fee.
** Other equipment comprises motor vehicles, IT hardware and office equipment.
Plant and machinery
During the year the Group expended £11,837,000 on fixed assets. The focus here has been within the mechanical
engineering segment and to develop further the infrastructure and capabilities at both Goodwin International and
Goodwin Steel Castings to deal with their increased workloads.
Assets in the course of construction of £7,779,000 (2020: £2,006,000) comprise £4,481,000 (2020: £1,345,000) in
relation to land and buildings and £3,298,000 (2020: £661,000) for plant and machinery.
63
NOTES TO THE FINANCIAL STATEMENTS
11. Property, plant and equipment (continued)
Depreciation
Depreciation is reported as follows:
Cost of sales
Administrative expenses
… … … … … … … … … … …
… … … … … … … … …
2021
£’000
5,393
303
5,696
2020
£’000
5,557
317
5,874
Security
There is a charge over Noreva GmbH’s land and buildings of €1.4 million to secure a bank loan repayable by
instalments and at Goodwin PLC a bank loan of £4.0 million is secured against three furnaces located at
Goodwin Steel Castings Limited (see note 20).
12. Right-of-use assets
Cost
Land and
buildings
£’000
Plant and
machinery
£’000
Other
equipment
£’000
Total
£’000
-
100
1,042
Balance recognised on transition to IFRS 16
Opening balance transfer from property,
plant and equipment … … … …
Additions … … … … … …
Exchange adjustment … … … …
Balance at 30th April, 2020
Balance at 1st May, 2020
… … …
Additions … … … … … …
Transfer to tangible fixed assets … …
Reclassification … … … … …
Disposals … … … … … …
Exchange adjustment … … … …
Balance at 30th April, 2021
Depreciation
Opening balance transfer from property,
plant and equipment … … … …
Charged in year … … … … …
Exchange adjustment … … … …
Balance at 30th April, 2020
Balance at 1st May, 2020
… … …
Charged in year … … … … …
Transfer to tangible fixed assets … …
Reclassification … … … … …
Disposals … … … … … …
Exchange adjustment … … … …
Balance at 30th April, 2021
Net book value
At 1st May, 2019 … … … … …
At 30th April, 2020 and 1st May, 2020
…
At 30th April, 2021
Depreciation
Depreciation is charged as follows:
942
-
1,013
(18)
1,937
1,937
1,079
-
-
(285)
(3)
2,728
-
506
(6)
500
500
499
-
-
(212)
(2)
785
942
1,437
1,943
4,648
144
(5)
4,787
4,787
70
(4,045)
(86)
(6)
1
721
693
290
(1)
982
982
306
(1,045)
(13)
(6)
-
224
3,955
3,805
497
-
32
-
4,648
1,189
(23)
132
6,856
132
1,251
-
86
-
(10)
6,856
2,400
(4,045)
-
(291)
(12)
1,459
4,908
-
31
-
31
31
167
-
13
-
(3)
693
827
(7)
1,513
1,513
972
(1,045)
-
(218)
(5)
208
1,217
100
101
4,997
5,343
1,251
3,691
2021
£’000
473
499
972
2020
£’000
321
506
827
Cost of sales
Administrative expenses
… … … … … … … … … … …
… … … … … … … … …
Of the £972,000 depreciation, £422,000 relates to finance leases (IAS 17 definition) (2020: £290,000) and £550,000
relates to operating leases (2020: £537,000).
64
NOTES TO THE FINANCIAL STATEMENTS
13. Investments in subsidiaries
The Group has the following principal subsidiaries. Non-principal subsidiaries are listed in note 30:
Registered Country of
address*
Incorporation
Class of
shares held
% held
Subsidiaries:
Mechanical Engineering:
Goodwin Steel Castings Limited
… … …
Goodwin International Limited … … … …
Easat Radar Systems Limited … … … …
Goodwin Korea Company Limited … … …
Goodwin Pumps India Private Limited
… …
Goodwin Shanghai Company Limited … … …
Noreva GmbH
… … … … … …
Goodwin Indústria e Comércio de Bombas
8
Submersas Ltda … … … … … …
1
Internet Central Limited … … … … …
9
Goodwin Submersible Pumps Australia Pty. Limited
1
Metal Proving Services Limited … … … …
NRPL Aero Oy
… … … … … … 10
Goodwin Submersible Pumps Africa Pty. Limited … 15
1
Duvelco Limited … … … … … …
1
1
1
3
4
5
6
Refractory Engineering:
1
Goodwin Refractory Services Limited … … …
1
Dupré Minerals Limited … … … … …
2
Hoben International Limited … … … …
Gold Star Powders Private Limited … … …
4
Siam Casting Powders Limited … … … … 11
Ultratec Jewelry Supplies Limited … … … 12
SRS (Qingdao) Casting Materials Company Limited
13
Jewelry Plaster Limited … … … … … 14
100
England and Wales Ordinary
100
England and Wales Ordinary
77
England and Wales Ordinary
95
Ordinary
South Korea
100
Ordinary
India
Ordinary
China
100
Ordinary 100
Germany
Brazil
Ordinary
England and Wales Ordinary
Australia
Ordinary
England and Wales Ordinary
Ordinary
Finland
South Africa
Ordinary
England and Wales Ordinary
England and Wales Ordinary
England and Wales Ordinary
England and Wales Ordinary
Ordinary
India
Ordinary
Thailand
Ordinary
China
Ordinary
China
Ordinary
Thailand
100
82
100
100
77
100
100
100
100
100
100
58
75.5
75.5
75
*The registered address for each company can be found in note 32.
All of the above companies are included as part of the consolidated accounts and are involved in mechanical and
refractory engineering.
NCI – Non-controlling interests
The following subsidiaries each have non-controlling interests:
Registered Country of
address*
Incorporation
Class of
shares held
% held
by NCI
Mechanical Engineering:
Easat Radar Systems Limited … … … … 1
Goodwin Korea Company Limited … … … 3
Internet Central Limited … … … … … 1
NRPL Aero Oy
… … … … … … 10
Refractory Engineering:
Jewelry Plaster Limited … … … … … 14
Jewelry Wax Limited
… … … … … 14
Siam Casting Powders Limited … … … … 11
SRS Guangzhou Limited … … … … … 12
SRS (Qingdao) Casting Materials Company Limited 13
Shenzhen King-Top Modern Hi-Tech Company Limited 16
Ultratec Jewelry Supplies Limited … … … 12
Ying Tai (UK) Limited
… … … … … 1
England and Wales Ordinary
South Korea
Ordinary
England and Wales Ordinary
Ordinary
Finland
Ordinary
Thailand
Ordinary
Thailand
Ordinary
Thailand
Ordinary
China
Ordinary
China
Ordinary
China
China
Ordinary
England and Wales Ordinary
23
5
18
23
25
25
42
24.5
24.5
24.5
24.5
24.5
The financial information on subsidiaries with non-controlling interests has been aggregated, analysing the data by
segment, as the entities in each segment have similar characteristics and risk profiles.
Year Ended 30th April
Profit / (loss) allocated to non-controlling
interests … … … … …
Dividends paid to non-controlling
interests … … … … …
Accumulated reserves held by
non-controlling interests … …
Mechanical
Engineering
Refractory
Engineering
Total
2021
£’000
2020
£’000
2021
£’000
2020
£’000
2021
£’000
2020
£’000
(283)
(262)
795
736
512
474
-
-
(125)
-
(125)
-
243
458
4,644
4,127
4,887
4,585
65
NOTES TO THE FINANCIAL STATEMENTS
13. Investments in subsidiaries (continued)
The summarised financial information below represents the amounts in the financial statements of the
subsidiaries, before any intercompany eliminations, and does not reflect the Group’s share of those amounts.
Year Ended 30th April
Non-current assets … … …
Mechanical
Engineering
2021
£’000
2,954
2020
£’000
2,985
Current assets
… … …
13,425
20,550
Refractory
Engineering
2021
£’000
12,037
14,529
2020
£’000
12,236
12,671
Total
2021
£’000
14,991
27,954
2020
£’000
15,221
33,221
Current liabilities
… … …
(13,333)
(17,170)
(7,071)
(7,082)
(20,404)
(24,252)
Non-current liabilities
… …
(388)
(2,939)
(511)
(728)
(899)
(3,667)
Total net assets of companies with
non-controlling interests
Revenue of companies with
non-controlling interests … …
Profit / (loss) for the year of companies
with non-controlling interests …
Total comprehensive income of
companies with non-controlling interests
Net cash from operating activities
Net cash from investing activities
Net cash from financing activities
14. Investment in associate
2,658
3,426
18,984
17,097
21,642
20,523
15,984
19,835
19,269
18,764
35,253
38,599
(918)
(1,177)
3,137
2,851
2,219
1,674
(769)
823
(320)
(146)
(985)
511
(646)
(32)
2,733
1,926
(992)
(1,037)
2,647
3,977
(1,937)
(1,032)
1,964
2,749
(1,312)
(1,183)
1,662
4,488
(2,583)
(1,064)
The Group’s share of profit after tax in its immaterial associate for the year ended 30th April, 2021 was £60,000
(2020: £66,000).
Summary financial information of the Group’s share of its associate company is as follows:
… … … … … … … … … …
Balance at 1st May
Profit before tax … … … … … … … … … … …
Tax … … … … … … … … … … … … …
Exchange adjustment … … … … … … … … … …
Balance at 30th April… … … … … … … … … …
Assets
… … … … … … … … … … … …
Liabilities … … … … … … … … … … … …
2021
£’000
816
75
(15)
(47)
829
967
(138)
829
2020
£’000
739
80
(14)
11
816
1,076
(260)
816
66
NOTES TO THE FINANCIAL STATEMENTS
15. Intangible assets
Cost
Balance at 1st May, 2019 …
Additions… … … …
Reclassification
… …
Disposals… … … …
…
Exchange adjustment
Brand
names
and
intellectual
property
£’000
7,674
1,936
-
-
62
Goodwill
£’000
10,008
161
-
-
64
Balance at 30th April, 2020
10,233
9,672
Balance at 1st May, 2020 …
Additions… … … …
Disposals… … … …
…
Exchange adjustment
10,233
-
-
(15)
9,672
18
-
(45)
Order
book
£’000
159
-
-
-
2
161
161
-
(161)
-
Manufact- Software Develop-
ment
costs
£’000
and
Licences
£’000
uring
rights
£’000
5,318
102
-
-
-
684
275
357
(116)
(25)
7,313
1,105
-
-
8
Total
£’000
31,156
3,579
357
(116)
111
5,420
1,175
8,426 35,087
5,420
68
-
5
1,175
224
(11)
3
8,426
1,420
(25)
-
35,087
1,730
(197)
(52)
Balance at 30th April, 2021
10,218
9,645
-
5,493
1,391
9,821 36,568
Amortisation and impairment
Balance at 1st May, 2019 …
Amortisation for the year …
Reclassification
… …
Disposals… … … …
…
Exchange adjustment
343
-
-
-
-
5,411
439
-
-
34
Balance at 30th April, 2020
343
5,884
Balance at 1st May, 2020 …
Amortisation for the year …
Impairment … … …
Disposals… … … …
…
Exchange adjustment
343
-
-
-
(4)
5,884
591
-
-
(12)
Balance at 30th April, 2021
339
6,463
Net book value
At 1st May, 2019… … …
9,665
2,263
At 30th April, 2020
and 1st May, 2020 … …
9,890
3,788
At 30th April, 2021
…
9,879
3,182
159
-
-
-
2
161
161
-
-
(161)
-
-
-
-
-
1,845
382
-
-
-
2,227
2,227
334
-
-
2
365
220
357
(116)
(16)
810
810
240
-
(6)
2
679
287
-
-
1
8,802
1,328
357
(116)
21
967 10,392
967
381
20
(24)
-
10,392
1,546
20
(191)
(12)
2,563
1,046
1,344 11,755
3,473
319
6,634
22,354
3,193
2,930
365
345
7,459
24,695
8,477 24,813
Customer lists are included within brand names and intellectual property or within manufacturing rights,
depending on the nature of the acquisition; non-compete agreements are disclosed within manufacturing rights.
During the year, the Group added to its portfolio of intangible assets.
On 23rd December, 2019, Goodwin PLC successfully acquired the globally recognised Castaldo silicone rubber
and wax assets, including the intellectual property, trade name and associated trademarks. For the past 75 years,
Castaldo has been at the heart of the worldwide jewellery casting industry by supplying moulding rubber and
injection waxes, and the recent acquisition will further increase the Group’s global market share.
Identifiable assets acquired
The table below analyses the total identifiable Castaldo assets acquired during the year ended 30th April, 2020.
Property, plant and equipment
… … … … … … … …
Brand name and registered trademarks … … … … … … …
Customer list
… … … … … … … … … … …
Recipe intellectual property … … … … … … … … …
…
…
…
…
…
…
…
…
Total identifiable net assets acquired
£’000
38
1,301
77
558
1,974
67
NOTES TO THE FINANCIAL STATEMENTS
15. Intangible assets (continued)
Consideration
The consideration for the net assets acquired was as follows:
Cash consideration paid in the previous year … … … … … …
… … … … … …
Cash consideration paid in the current year
…
…
…
…
Total cash consideration
Acquisition costs … … … … … … … … … … …
…
…
£’000
1,517
457
1,974
23
Amortisation and impairment charges
The amortisation charge of £1,546,000 (2020: £1,328,000) and impairment charge of £20,000 (2020: £Nil) are
reported in cost of sales in the statement of profit or loss.
Impairment testing for cash-generating units containing goodwill
The Group tests goodwill annually for impairment or more frequently if there are indications that goodwill might
be impaired. For the purpose of impairment testing, goodwill is allocated to the relevant subsidiary which
is the lowest level within the Group at which the goodwill is monitored for internal management purposes.
The aggregate carrying amounts of goodwill allocated to each unit are:
2021
£’000
4,742
3,346
1,260
531
2020
£’000
4,744
3,346
1,260
540
Noreva GmbH
… … … … … … … … … …
Goodwin Refractory Services Holdings Limited … … … … …
NRPL Aero Oy… … … … … … … … … … …
Other … … … … … … … … … … … …
9,879
9,890
An impairment test is a comparison of the carrying value of the assets of a cash-generating unit (“CGU”) to
their recoverable amount, based on a value-in-use calculation. Recoverable amount is the greater of value-in-
use and fair value less costs of disposal. Where the recoverable amount is less than the carrying value an
impairment results. During the year each CGU containing goodwill was separately assessed and tested for
impairment.
As part of testing goodwill for impairment detailed forecasts of operating cash flows for the next five years
are used, which are based on budgets and plans approved by the Board. The forecasts represent the best
estimate of future performance of the CGU based on past performance and expectations for the market
development of the CGU.
A number of key assumptions are used as part of impairment testing. These key assumptions, such as the
CGU’s position within its relevant market; its ability to generate profitable orders within that market; expected
growth rates both in the market and geographically, are made by management who also take into account
past experience and knowledge of forecast future performance together with other relevant external sources
of information.
The projections use various growth rates consistent with the profit forecasts of the CGU for the first five
years (typically 0% to 15%), with a zero growth rate then assumed for any terminal values. The forecasts are
then discounted at an appropriate pre-tax weighted average cost of capital rate considering the perceived
levels of risk, ranging between 9.8% and 17.8% (2020: between 10% and 20%) for the Mechanical Engineering
Division and 11.4% to 12% (2020: between 13% and 21%) for the Refractory Engineering Division. Further
sensitivity tests are then performed reducing the discounted cash flows by 10% and also increasing the
discount rate by a range of up to 10% to confirm there is no need to consider further a need for impairment.
The estimates and assumptions made in connection with the impairment testing could differ from future actual
results of operations and cash flows. A reasonably likely variation in the assumptions would not give rise to an
impairment. However, future events could cause the Group to conclude that impairment indicators exist and
that the asset values associated with a given operation have become impaired.
68
NOTES TO THE FINANCIAL STATEMENTS
16. Inventories
Raw materials and consumables … … … … … … … …
Work in progress … … … … … … … … … … …
Finished goods … … … … … … … … … … …
The amount of inventory impaired during the year was £1,427,000 (2020: £2,745,000).
The Group carries provisions against inventories as follows:
Raw materials and consumables … … … … … … … …
Work in progress … … … … … … … … … … …
Finished goods … … … … … … … … … … …
17. Trade and other financial assets
Balances due within one year
Trade receivables … … … … … … … … … …
Other financial assets … … … … … … … … …
…
…
2021
£’000
16,572
9,784
8,191
34,547
2021
£’000
373
493
435
1,301
2021
£’000
19,378
1,162
20,540
2020
£’000
18,717
17,334
8,836
44,887
2020
£’000
301
532
417
1,250
2020
£’000
23,589
897
24,486
The Group had a long-term receivable balance due from an associate company, which is repayable within five
years. The balance, which is due after more than one year, is disclosed within non-current assets, with the
balance due within one year, of £250,000 (2020: £255,000) being reported within other current financial assets.
Interest is charged at a commercial rate.
Balances due after more than one year
Other receivables … … … … … … … … … …
…
18. Other receivables
Advance payments to suppliers
… … … … … … … …
Prepayments and other non-financial assets … … … … … …
Corporation tax receivable … … … … … … … … …
… … … … … … … …
Deferred tax asset (see note 24)
19. Cash and cash equivalents
Cash and cash equivalents per balance sheet … … … … … …
Bank overdrafts … … … … … … … … … … …
2021
£’000
-
2021
£’000
2,002
2,594
902
129
5,627
2021
£’000
15,160
-
Cash and cash equivalents per cash flow statement … … … … …
15,160
2020
£’000
252
2020
£’000
1,640
2,582
284
60
4,566
2020
£’000
9,840
(391)
9,449
20. Borrowings
This note provides information about the contractual terms of the Group’s lease liabilities, bank loans and
borrowings. The bank loans repayable by instalment are secured against a property in Germany and
furnaces in the UK (see note 11). For more information about the Group’s exposure to interest rate and
foreign currency risk, see note 26.
Non-current liabilities
Bank loans – repayable by instalments … … … … … … …
Bank loans – rolling credit facilities … … … … … … … …
Lease liabilities … … … … … … … … … … …
2021
£’000
4,538
26,000
2,528
33,066
2020
£’000
5,260
9,000
1,339
15,599
69
NOTES TO THE FINANCIAL STATEMENTS
20. Borrowings (continued)
Current liabilities
Bank overdrafts … … … … … … … … … … …
Bank loans – repayable by instalments … … … … … … …
Bank loans – rolling credit facilities … … … … … … … …
Lease liabilities … … … … … … … … … … …
-
761
-
846
1,607
391
750
12,000
1,483
14,624
Reconciliation of liabilities arising from financing activities
Opening
balance
1st May
Change in
bank
2020 movements overdrafts
£’000
£’000
£’000
Non-cash
Foreign
Cash
exchange
flows movement
£’000
£’000
-
-
-
2,195
2,195
(391)
-
-
-
-
(724)
5,000
(1,635)
(391)
2,641
-
13
-
(8)
5
Non-cash
movements
£’000
Change in
bank
overdrafts
£’000
Foreign
Cash
exchange
flows movement
£’000
£’000
Closing
balance
30th April
2021
£’000
-
5,299
26,000
3,374
34,673
Closing
balance
30th
April 2020
£’000
-
-
-
2,087
2,087
(8,756)
-
-
-
-
4,556
3,000
(1,361)
(8,756)
6,195
-
20
-
(7)
13
391
6,010
21,000
2,822
30,223
Bank overdrafts used for
cash management …
391
Bank loans – repayable
by instalments … …
6,010
Bank loans – rolling
credit facilities … …
Lease liabilities … …
21,000
2,822
30,223
Opening
balance
1st May
2019
£’000
Bank overdrafts used for
cash management …
9,147
Bank loans – repayable
by instalments … …
1,434
Bank loans – rolling
credit facilities … …
Lease liabilities … …
18,000
2,103
30,684
Bank loans repayable by instalments
Bank loans are payable as follows:
Less than one year … … …
Between one and five years
…
… …
More than five years
2021
2020
Minimum
loan
payments
£’000
903
3,570
1,406
5,879
Interest Principal
£’000
£’000
142
324
114
580
761
3,246
1,292
5,299
Minimum
loan
payments
£’000
912
3,547
2,289
6,748
Interest
£’000
Principal
£’000
162
419
157
738
750
3,128
2,132
6,010
70
NOTES TO THE FINANCIAL STATEMENTS
20. Borrowings (continued)
Lease liabilities
The contractual undiscounted cash flows are payable as follows:
Less than one year … … …
…
Between one and five years
… …
More than five years
2021
2020
Minimum
lease
payments
£’000
938
2,219
454
3,611
Interest Principal
£’000
£’000
92
127
18
237
846
2,092
436
3,374
Minimum
lease
payments
£’000
1,552
1,410
-
2,962
Interest
£’000
Principal
£’000
69
71
-
140
1,483
1,339
-
2,822
Of the total lease liabilities, £1,292,000 (2020: £1,256,000) relate to finance leases (IAS17 definition) and £2,082,000
(2020: £1,566,000) to operating leases (IAS17 definition).
21. Trade and other financial liabilities
Trade payables … … … … … … … … … … …
Other financial liabilities… … … … … … … … … …
Other taxation and social security costs … … … … … … …
… 16,791
1,424
…
3,515
…
2021
£’000
2020
£’000
19,238
1,688
2,559
22. Other payables
Accrued expenses… … … … … … … … … … …
Advance payments from customers … … … … … … … …
…
…
23. Provisions
Balance at 1st May, 2020 (1st May, 2019) … … … … … … …
Increase in provision … … … … … … … … … …
Release of provision … … … … … … … … … …
Provision utilised … … … … … … … … … … …
Exchange adjustment … … … … … … … … … …
Balance at 30th April… … … … … … … … … …
Warranty due within one year … … … … … … … … …
Warranty due after one year … … … … … … … … …
Balance at 30th April… … … … … … … … … …
…
…
…
…
…
…
…
…
…
21,730
23,485
2021
£’000
3,543
482
4,025
2021
£’000
484
550
(164)
(11)
-
859
608
251
859
2020
£’000
3,212
86
3,298
2020
£’000
493
251
-
(265)
5
484
160
324
484
Provisions include warranties for products sold which generally cover a period of between 1 and 3 years, and
other provisions which are due within one year.
71
NOTES TO THE FINANCIAL STATEMENTS
24. Deferred tax assets and liabilities
Deferred tax assets and liabilities are attributable to the following:
Assets
Liabilities
Property, plant and equipment
… … … … …
Intangible assets … … … … … … … …
Derivative financial instruments … … … … …
… … … … …
Share-based payments reserve
Other temporary differences … … … … … …
2021
£’000
127
46
58
915
234
1,380
2020
£’000
221
286
241
1,888
192
2,828
Deferred tax asset (see note 18) … … … … … … … …
Deferred tax liability … … … … … … … … … …
…
…
2021
£’000
(4,509)
(1,732)
(494)
-
(90)
2020
£’000
(3,765)
(1,898)
(98)
-
(78)
(6,825)
(5,839)
2021
£’000
2020
£’000
129
(5,574)
60
(3,071)
(5,445)
(3,011)
Property,
plant and Intangible
Derivative
financial
assets instruments
£’000
£’000
equipment
£’000
Share-
based
payments
Other
temporary
reserve differences
£’000
£’000
Total
£’000
Balance at 1st May, 2019
(3,014)
(1,306)
252 2,630
125
(1,313)
Recognised in profit or loss …
…
Recognised in equity
…
Exchange adjustment
(546)
-
16
(115)
(161)
(30)
(186) (995)
77 253
- -
(10)
-
(1)
(1,852)
169
(15)
Balance at 30th April, 2020
(3,544)
(1,612)
143 1,888
114
(3,011)
Recognised in profit or loss …
…
Recognised in equity
…
Exchange adjustment
(866)
-
28
(31)
-
(43)
94 (973)
(673) -
- -
18
-
12
(1,758)
(673)
(3)
Balance at 30th April, 2021
(4,382)
(1,686)
(436) 915
144
(5,445)
Within the current and previous year, the Group has no material tax losses where a deferred tax asset has
been recognised. As at 30th April, 2021, the Group has not recognised £436,000 (2020: £511,000) of deferred tax
assets in relation to the accumulated losses of £2,016,000 (2020: £2,015,000) within subsidiaries.
The Finance (No.2) Act 2015 reduced the main rate of UK corporation tax to 19%, effective from 1st April, 2017.
A further reduction in the UK corporation tax rate to 17% was expected to come into effect from 1 April, 2020
(as enacted by Finance Act 2016 on 15th September, 2016). However, legislation introduced in the Finance Act
2020 (enacted on 22nd July, 2020) repealed the reduction of the corporation tax, thereby maintaining the
current rate of 19%. Deferred taxes on the balance sheet have been measured at 19% which represents the
future corporation tax rate that was enacted at the balance sheet date.
The UK Budget 2021 announcements on 3rd March, 2021 included measures to support economic recovery as
a result of the ongoing Covid-19 pandemic. These included an increase to the UK’s main corporation tax rate
to 25%, which is due to be effective from 1st April, 2023. These changes were not substantively enacted at the
balance sheet date and hence have not been reflected in the measurement of deferred tax balances at the
period end. If the Group’s deferred tax balances at the period end were re-measured at 25% this would result
in a deferred tax charge of £1.5 million.
72
NOTES TO THE FINANCIAL STATEMENTS
25. Capital and reserves
Share capital
Authorised, allotted, called up and fully paid:
7,363,000 (2020: 7,200,000) ordinary shares of 10p each … … … … …
Issue of 163,200 ordinary shares of 10p each … … … … … … …
2021 2020
£’000
£’000
736
17
753
720
16
736
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled
to one vote per share at meetings of the Company.
Translation reserve
The translation reserve comprises all foreign exchange differences arising from the translation of the financial
statements of foreign operations.
Share-based payments reserve
The share-based payments reserve is a non cash-impacting provision, as required by Accounting Standard
IFRS 2, relating to the Equity Long Term Incentive Plan, which vested at 1st May, 2019. Further details are
included in note 33.
Cash flow hedging reserve
The hedging reserve comprises the effective portion of the cumulative net change in the fair value of cash flow
hedge instruments related to hedged transactions that have not yet occurred.
Deferred tax
The aggregate deferred tax relating to items that are recognised in equity is an asset of £528,000 (2020:
£1,629,000), being an asset of £915,000 (2020: £1,348,000) in respect of the Equity Long Term Incentive Plan and
a liability of £387,000 (2020: asset of £281,000) in respect of derivatives.
26. Financial risk management
The Group’s operations expose it to a variety of financial risks that include the effects of changes in market
prices (interest rates, foreign exchange rates and commodity prices), credit risk and liquidity. The Group has
in place risk management policies that seek to limit the adverse effects on the financial performance of the
Group by using various instruments and techniques.
Risk management policies have been set by the Board and applied by the Group.
a) Credit risk
The Group’s financial assets are cash and cash equivalents; trade and other receivables; contract assets, the
carrying amounts of which represent the Group’s maximum exposure to credit risk in relation to financial
assets.
The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings
assigned by international credit rating agencies.
The Group’s credit risk is primarily attributable to its trade receivables and is managed through the
following processes:
i) The majority of orders accepted by Group companies are backed by credit insurance.
ii) Some orders are accepted with no credit insurance but with letters of credit.
iii) Some orders are accepted with no credit insurance and no letter of credit but with an internal analysis of
the customer’s size, creditworthiness, historic profitability and payment record.
iv) A few orders (less than 10%), with a material value, are taken at risk following review by at least two
Board members.
v) Major orders are normally accompanied by stage payments which go towards mitigating our credit risk.
Whilst the theoretical credit risk would be the actual balances themselves as reported within the table below,
this assumes that the credit insurance company is also a credit risk for the invoiced trade debtors and
contract assets underwritten by them. Our insurer enjoys a strong credit rating with the likes of Moody’s, S&P
and Fitch. As a result, and after having looked back on the Group’s track record of negligible impairment
losses on these type of assets over the last 10 years, the Directors are of the opinion that there is no cost /
benefit in performing an ECL type loss analysis and so impairment provisions are based on known issues
rather than a statistical estimate.
73
NOTES TO THE FINANCIAL STATEMENTS
26. Financial risk management (continued)
a) Credit risk (continued)
Exposure to credit risk
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure
to credit risk at the reporting date was:
Carrying amount
Contract assets … … … … … … … …
Trade and other financial assets – due after more than one year
Trade and other financial assets – due within one year … …
Cash at bank and cash equivalents … … … … …
Derivative financial assets… … … … … … …
Notes
4
17
17
19
26d)
2021
£’000
15,844
-
20,540
15,160
4,297
55,841
2020
£’000
6,558
252
24,486
9,840
1,205
42,341
The maximum exposure to credit risk for trade receivables, before taking into account credit insurance,
at the reporting date by geographic region was:
UK … … … … … … … … … … … …
Rest of Europe … … … … … … … … … …
USA … … … … … … … … … … … …
Pacific Basin
… … … … … … … … … …
Rest of World … … … … … … … … … …
Carrying amount
2021
£’000
3,874
4,102
775
5,008
5,619
2020
£’000
5,403
1,947
1,640
5,072
9,527
19,378
23,589
The ageing of trade receivables and impairments at the reporting date was:
Net
2021
£’000
Not past due … … … 13,446
Past due 1-30 days … …
3,033
Past due 31-90 days… …
1,175
Past due more than 90 days
1,724
Gross
2021
£’000
13,503
3,035
1,189
2,199
Impairment
provision
2021
£’000
(57)
(2)
(14)
(475)
Net
2020
£’000
14,696
3,067
2,609
3,217
Gross
2020
£’000
14,709
3,083
2,656
3,457
Impairment
provision
2020
£’000
(13)
(16)
(47)
(240)
19,378
19,926
(548)
23,589
23,905
(316)
Management believes that there are no significant credit risks remaining with the above net receivables and
that the credit quality of customers is good, based on a review of past payment history and the current
financial status of the customers. Included in trade receivables are retentions which are job specific and
have varying due dates depending on the complexity of the job. These are included in the not past due
category. The Group has not renegotiated the terms of any trade receivables and has not pledged any
trade receivables as security.
The Directors estimate that the fair value of the Group’s trade and other receivables is approximate to their
carrying values.
An analysis of the provision for impairment of receivables is as follows:
Balance at 1st May, 2020 (1st May, 2019) … … … … … …
Increase in provision … … … … … … … … …
Release of provision … … … … … … … … …
Provision utilised during the year … … … … … … …
Exchange adjustment … … … … … … … … …
At 30th April
… … … … … … … … … …
2021
£’000
316
369
(50)
(89)
2
548
2020
£’000
281
188
(139)
(8)
(6)
316
74
NOTES TO THE FINANCIAL STATEMENTS
26. Financial risk management (continued)
b) Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring
unacceptable losses or risking damage to the Group’s reputation.
At the year end the Group had the following unutilised bank facilities in respect of which all conditions
precedent had been met:
Uncommitted
2020
2021
£’000
£’000
Committed
2021
£’000
2020
£’000
Total
2021
£’000
2020
£’000
Unutilised bank facilities
…
6,050
17,095
18,500
12,000
24,550
29,095
The Group’s principal borrowing facilities are provided by three banks in the form of borrowings and short-
term overdraft facilities. The quantum of borrowing facilities available to the Group is reviewed regularly in
light of current working capital requirements and the need for capital investment for the long-term future
for the Group.
Maturity analysis
The table below analyses the Group’s financial liabilities into maturity groupings based on the period
outstanding at the balance sheet date up to the contractual maturity date. All figures are contracted gross
cash flows that have not been discounted.
2021
Contractual cash flows
Within
1 year
£’000
1-5 years
£’000
5+ years
£’000
Non-derivative financial liabilities
903
Bank loans and committed facilities …
Lease liabilities
938
… … … …
Trade and other financial liabilities … 21,730
29,570
2,219
-
1,406
454
-
Total
£’000
31,879
3,611
21,730
2021
Carrying
value
Total
£’000
31,299
3,374
21,730
Total … … … … … … 23,571
31,789
1,860
57,220
56,403
The interest rates chargeable on these loans are on a floating basis against LIBOR and UK base rate, with
bank margins of less than 2%. With effect from 1st September, 2021 the Group has entered into a ten year
derivative with HSBC to fix its variable interest rate at less than 1% against a notional £30 million of debt.
There is also a bank loan of £1.3 million repayable by instalments, with the final payment due in the year ended
30th April, 2039. Interest is charged at an effective interest rate of 1.96%, which is fixed for the whole period.
2020
Carrying
value
Total
£’000
2020
Contractual cash flows
Within
1 year
£’000
1-5 years
£’000
5+ years
£’000
Total
£’000
Non-derivative financial liabilities
Bank loans and committed facilities …
Overdrafts … … … … …
Lease liabilities … … … …
Trade and other financial liabilities …
12,912
391
1,552
23,485
12,547
-
1,410
-
Total … … … … … …
38,340
13,957
2,289
-
-
-
2,289
27,748
391
2,962
23,485
54,586
27,010
391
2,822
23,485
53,708
c) Market risk
Foreign exchange risk
The Group is subject to fluctuations in exchange rates on its net investments overseas and transactional
monetary assets and liabilities not denominated in the operating (or “functional”) currency of the operating
unit involved.
The Group is exposed to fluctuations in several currencies which give rise to the net currency gains and
losses recognised in the statement of profit or loss.
The Group at its discretion is empowered to hedge its estimated annual foreign currency exposure in
respect of forecast sales and purchases if the Board deems it appropriate after having taken into account
the expected movement in the foreign exchange rates. The Group uses forward exchange contracts to
hedge its foreign currency risk. The foreign exchange contracts have maturities within three years after the
balance sheet date. Where necessary, the forward exchange contracts are rolled over at maturity.
75
NOTES TO THE FINANCIAL STATEMENTS
26. Financial risk management (continued)
c) Market risk (continued)
Foreign exchange risk (continued)
In respect of other monetary assets and liabilities held in currencies, the Group ensures that the net exposure
is eliminated through the use of forward exchange contracts or spot transactions at the time the contractual
commitment is in place.
Currency profile of financial assets and liabilities:
2021
US
Dollar
£’000
2020
US
Dollar
£’000
2021
2020
2021
2020
2021
Euro
£’000
Euro
£’000
Other
£’000
Other
£’000
Total
£’000
2020
Total
£’000
Trade and other
receivables
Cash and cash
equivalents
Trade and other
payables
2,511
4,584
1,513
1,068
-
-
4,024
5,652
789
576
(40)
(2,634)
454
1,786
1,203
(272)
(537)
(1,770)
(661)
(1,185)
(763)
(1,768)
(1,961)
(4,723)
2,763
3,390
812
(2,751)
(309)
18
3,266
657
The following significant exchange rates applied during the year:
US Dollar … … … … …
Euro … … … … … …
Average exchange rate
2020
1.2661
1.1427
2021
1.3202
1.1222
Reporting date spot rate
2020
1.2594
1.1497
2021
1.3845
1.1500
Interest rate risk
The Group is subject to fluctuations in interest rates on its borrowings and surplus cash. The Group is aware
of the financial products available to hedge against adverse movements in interest rates. Formal reviews
are undertaken to determine whether such instruments are appropriate for the Group. During the financial
year just completed, no new interest rate swaps or caps were entered into. As reported elsewhere in these
financial statements the Company on 2nd July, 2021 has mitigated the impact of interest rate risk by taking
out an interest rate swap derivative fixing £30 million of notional debt at less than 1% versus the variable
inter-bank lending rate (SONIA) for a period of ten years.
The table below shows the Group’s financial assets and liabilities split by those bearing fixed and floating
rates and those that are non interest-bearing.
Fixed rate
Floating rate
Non interest-bearing
Total
2021
£’000
2020
£’000
2021
£’000
2020
£’000
2021
£’000
2020
£’000
2021
£’000
-
-
250
-
-
-
-
-
-
-
15,160
-
9,840
-
-
15,844
-
6,558
15,160
15,844
507
-
-
-
-
-
-
-
-
-
-
-
-
-
-
20,290
4,297
(14,332)
24,231
1,205
(18,965)
20,540
4,297
(14,332)
-
-
(391)
(21,730)
(2,016)
-
(23,485)
(1,273)
-
(21,730)
(2,016)
-
2020
£’000
9,840
6,558
24,738
1,205
(18,965)
(23,485)
(1,273)
(391)
Cash and cash
equivalents
Contract assets
Trade and
financial assets
Derivative assets
Contract liabilities
Trade and other
financial liabilities
Derivative liabilities
Bank overdrafts
Bank loans and
committed
facilities
Lease liabilities
(5,299)
(2,945)
(5,988)
(2,822)
(26,000)
(429)
(21,022)
-
-
-
-
-
(31,299)
(3,374)
(27,010)
(2,822)
(7,994)
(8,303)
(11,269)
(11,573)
2,353
(11,729)
(16,910)
(31,605)
76
NOTES TO THE FINANCIAL STATEMENTS
26. Financial risk management (continued)
d) Capital management
The Group’s main objective when managing capital is to safeguard the Group’s ability to continue as a going
concern in order to provide returns to shareholders. The Board maintains a strong capital base so as to
maintain investor, creditor and market confidence and to sustain future development of the business.
Operations are funded through various shareholders’ funds, bank debt, finance leases and, where
appropriate, deferred consideration on acquisitions. The capital structure of the Group reflects the judgement
of the Board as to the appropriate balance of funding required. At 30th April, 2021, the capital used was
£130.6 million, (2020: £123.8 million) as shown in the following table:
2021
£’000
Cash and cash equivalents … … … … … … (15,160)
Total lease liabilities … … … … … … …
3,374
… … … … 31,299
Bank loans and committed facilities
-
Overdrafts
… … … … … … … …
Net debt in accordance with IFRS16
… … … … 19,513
Operating lease debt (IAS17 definition) … … … … (2,082)
2020
£’000
(9,840)
2,822
27,010
391
20,383
(1,566)
Relevant net debt for KPI purposes… … … … … 17,431
Total equity attributable to equity holders of the parent … 113,141
18,817
105,017
Capital
130,572
123,834
The Directors, for the purpose of calculating and monitoring the Group’s gearing ratio, do not recognise
the value of the capitalised leases where ownership does not ultimately vest with the Group – see note 34.
The Group aims to maintain a strong credit rating and headroom whilst optimising return to shareholders
through an appropriate balance of debt and equity funding. The Group's general strategy is to keep the debt
to equity ratio below 30%, adjusted where appropriate for the effect of acquisitions. At 30th April, 2021 net
debt was £17.4 million (2020: £18.8 million). The gearing ratio is 15.4% (2020: 17.9%).
The Group manages its capital structure and makes adjustments to it with regard to the risks inherent in the
business and in light of changes to economic conditions.
Working capital is managed in order to generate maximum conversion of profits into cash and cash
equivalents. Dividends are paid from current year profits, thereby maintaining equity.
The policy for debt is to ensure a smooth debt maturity profile with the objective of ensuring continuity of
funding. The repayment profile for the debt is shown in note 26(b).
There were no changes in the Group’s approach to capital management during the year.
Currency derivatives
The Group utilises currency derivatives to hedge future transactions and cash flows. The Group is party to
a variety of foreign currency forward contracts in the management of its exchange rate exposures. Foreign
currency forward contracts are denominated in the same currency as the highly probable future sales
and the hedged ratio is 1:1.
Forecast transactions
The Group classifies its forward exchange contracts hedging forecast transactions as cash flow hedges and
states them at fair value.
Recognised assets and liabilities
Changes in the fair value of forward exchange contracts that economically hedge monetary assets and
liabilities in foreign currencies and for which no hedge accounting is applied are recognised in the
statement of profit or loss. Both the changes in fair value of the forward contracts and the foreign
exchange gains and losses relating to the monetary items are recognised as part of cost of sales.
77
26. Financial risk management (continued)
d) Capital management (continued)
Derivative financial instruments
Nominal
value
Carrying amount
of hedged item
NOTES TO THE FINANCIAL STATEMENTS
2021
Accumulated amount
of fair value hedge
adjustments included
in the carrying
amount of the
hedged item
Change
in value
used to
calculate
hedge
ineffect-
iveness
Cash Cost of
flow hedging
and reserve
(net of
tax)
reserve
(net of
tax)
£’000
Assets
£’000
Liabilities
£’000
Assets
£’000
Liabilities
£’000
£’000
£’000
£’000
Cash flow
hedges
Forward
exchange
contracts
– current
Forward
exchange
contracts
– matured
43,945
1,166
(5)
1,166
(5)
1,259
929
14
15,852
904
-
904
904
732
59,797
2,070
(5)
2,070
(5)
2,163
1,661
Analysis of cash flow and cost of hedging reserve
Attributable to equity holders of the parent
Attributable to non-controlling interests
1,601
60
1,661
-
14
(1)
15
14
Nominal
value
Carrying amount
of hedged item
2020
Accumulated amount
of fair value hedge
adjustments included
in the carrying
amount of the
hedged item
Change
in value
used to
calculate
hedge
ineffect-
iveness
Cash
Cost of
flow hedging
reserve
and
(net of
reserve
tax)
(net of
tax)
£’000
Assets
£’000
Liabilities
£’000
Assets
£’000
Liabilities
£’000
£’000
£’000
£’000
97,107
338
(1,088)
9,400
106,507
-
338
(731)
(1,819)
-
-
-
(750)
(466)
169
(776)
(731)
(731)
(1,481)
(1,197)
(593)
(424)
-
(776)
Cash flow
hedges
Forward
exchange
contracts
– current
Forward
exchange
contracts
– matured
Analysis of cash flow and cost of hedging reserve
Attributable to equity holders of the parent
Attributable to non-controlling interests
78
(499)
75
(424)
(743)
(33)
(776)
NOTES TO THE FINANCIAL STATEMENTS
26. Financial risk management (continued)
d) Capital management (continued)
2021
2020
Nominal
value
Carrying amount of
unhedged item
Nominal
value
Carrying amount of
unhedged item
£’000
Assets
£’000
Liabilities
£’000
£’000
Assets
£’000
Liabilities
£’000
Forward exchange contracts
not designated in a cash
flow hedge … … …
28,926
3,131
(2,011)
36,802
867
(185)
The following table sets out the periods when the cash flows are expected to occur and when they are
expected to affect profit or loss:
2021
Carrying
amount
£’000
Expected Within
cash flow 1 year
£’000
£’000
Between
1 and
5 years
£’000
Forward exchange contracts / currency swaps
Assets not designated in a cash
…
Assets designated and effective
flow hedge relationship
… …
as cash flow hedging instruments … …
Total assets
Liabilities not designated in a cash
3,131
1,166
4,297
3,131
3,128
1,166
978
4,297
4,106
flow hedge relationship
… … …
(2,011)
(2,011)
(2,011)
Liabilities designated and effective
as cash flow hedging instruments … …
Total liabilities
(5)
(5)
(5)
(2,016)
(2,016)
(2,016)
Derivative financial instruments
3
188
191
-
-
-
2020
Carrying
amount
£’000
Expected Within
1 year
cash flow
£’000
£’000
Between
1 and
5 years
£’000
867
338
867
338
1,205
1,205
223
233
456
(185)
(185)
(185)
(1,088)
(1,273)
(1,088)
(886)
(1,273)
(1,071)
644
105
749
-
(202)
(202)
Forward exchange contracts / currency swaps
Assets not designated in a cash
…
Assets designated and effective
flow hedge relationship
… …
as cash flow hedging instruments … …
Total assets
Liabilities not designated in a cash
flow hedge relationship
… … …
Liabilities designated and effective
as cash flow hedging instruments … …
Total liabilities
79
NOTES TO THE FINANCIAL STATEMENTS
26. Financial risk management (continued)
d) Capital management (continued)
Sensitivity analysis
The Group has calculated the following sensitivities based on available data from forward contract markets
for the principal foreign currencies in which the Group operates. Given recent fluctuations in rates, it is
deemed sensible to provide the quantum for a 1% change in rates to aid understanding. These figures can
be extrapolated proportionately to obtain an estimate of the impact of large movements. The Group’s
exposure to foreign currency changes for all other foreign currencies is not considered material.
Impact on equity
2021
£’000
(Profit)/loss
2020
£’000
(Profit)/loss
1% increase in US Dollar fx rate against pound Sterling
… … …
1% increase in Euro fx rate against pound Sterling … … … …
1% decrease in US Dollar fx rate against pound Sterling … … …
1% decrease in Euro fx rate against pound Sterling … … … …
1% increase in interest rates
… … … … … … …
(345)
(207)
345
207
(424)
(633)
(202)
633
202
-
Impact on the statement of profit or loss
1% increase in US Dollar fx rate against pound Sterling
… … …
1% increase in Euro fx rate against pound Sterling … … … …
1% decrease in US Dollar fx rate against pound Sterling … … …
1% decrease in Euro fx rate against pound Sterling … … … …
2021
£’000
(Profit)/loss
2020
£’000
(Profit)/loss
(177)
(96)
177
96
(102)
(175)
102
175
e) Total financial assets and liabilities
The table below sets out the Group’s accounting classification of each class of financial assets and liabilities
and their fair values at 30th April, 2021 and 30th April, 2020.
Financial assets
At amortised cost
Cash and cash equivalents … … …
Contract assets … … … … …
Trade receivables … … … … …
Other receivables… … … … …
At fair value through profit and loss
Derivative financial assets not designated in
a cash flow hedge relationship … …
30th April, 2021
30th April, 2020
Carrying
amount
£’000
Fair value
£’000
Carrying
amount
£’000
Fair value
£’000
15,160
15,844
19,378
1,162
15,160
15,844
19,378
1,162
9,840
6,558
23,589
1,149
9,840
6,558
23,589
1,149
3,131
3,131
867
867
Fair value – hedging instrument
Derivative financial assets designated and
effective as cash flow hedging instruments
1,166
Total financial assets… … … …
55,841
1,166
55,841
338
338
42,341
42,341
80
NOTES TO THE FINANCIAL STATEMENTS
26. Financial risk management (continued)
e) Total financial assets and liabilities (continued)
30th April, 2021
30th April, 2020
Carrying
amount
£’000
Fair value
£’000
Carrying
amount
£’000
Fair value
£’000
Financial liabilities at amortised cost
… … … …
Contract liabilities
Trade payables … … … … …
Other financial liabilities
… … …
Lease liabilities … … … … …
Bank loans and committed facilities… …
Bank overdrafts … … … … …
14,332
16,791
4,939
3,374
31,299
-
14,332
16,791
4,939
3,374
31,299
-
18,965
19,238
4,247
2,822
27,010
391
18,965
19,238
4,247
2,822
27,010
391
At fair value through the profit and loss
Derivative financial liabilities not designated in
a cash flow hedge relationship … …
Fair value – hedging instrument
Derivative financial liabilities designated and
effective as cash flow hedging instruments
2,011
2,011
185
185
Total financial liabilities … … …
72,751
72,751
5
5
1,088
73,946
1,088
73,946
Derivative financial assets and liabilities fair values in the above table are derived using Level 2 inputs as
defined by IFRS 7 as detailed in the paragraph below.
IFRS 7 requires that the classification of financial instruments at fair value be determined by reference to
the source of inputs used to derive the fair value. This classification uses the following three-level
hierarchy: Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2 - inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); Level 3 - inputs for the asset
or liability that are not based on observable market data (unobservable inputs).
The Group does not use derivatives for speculative purposes. All transactions in derivative financial
instruments are underpinned by firm orders from customers or to suppliers or where there is a high
degree of probability that orders will be received.
For short-term cash and cash equivalents, trade and other receivables, trade and other financial liabilities,
fixed and floating rate borrowings, the fair values are the same as carrying value.
27. Capital commitments
Contracted capital commitments at 30th April, 2021 for which no provision has been made in these financial
statements were £488,000 (2020: £4,154,000).
28. Guarantees and contingencies
The table below sets out the number and value of unexpired bank guarantee bonds as at 30th April, 2021 and
30th April, 2020. These guarantee bonds are required as part of the terms and conditions within our mechanical
engineering contracts.
165 guarantee and bonds contracts (2020: 219) … … … … …
2021
£’000
9,613
2020
£’000
11,944
29. Subsequent events
After the balance sheet date an ordinary dividend of 102.24p per qualifying ordinary share was proposed by the
Directors (2020: Ordinary dividend of 81.71p).
The current year proposed ordinary dividend of £7,862,000 has not been provided for within these financial
statements (2020: Proposed ordinary dividend of £6,016,000 was not provided for within the comparative figures).
On 2nd July, 2021, the Company contracted to convert £30 million of notional debt in to a fixed rate of interest
of less than 1% versus the floating inter-banking rate (SONIA) for a period of ten years. With the level of
expected trade and the opportunities open to the Group going forwards, the Directors deemed it prudent to
fix its variable lending rate at what is perceived to be a favourable rate over this time frame.
81
NOTES TO THE FINANCIAL STATEMENTS
30. Non-principal subsidiaries and associates
Registered Country of
address*
Incorporation
Class of
shares held % held
Non-principal Subsidiaries:
Asian Industrial Investment Casting
4
Powders Private Limited … … … … …
5
Goodwin (Shanxi) Pumps Company Limited … …
8
… … … … …
Gold Star Brazil Limited
4
Easat Radar Systems India Private Limited
… …
1
Goodwin Engineering Training Company Limited …
Goodwin Refractory Services India Private Limited …
4
Jewelry Wax Limited … … … … … … 14
GRS Silicone Company Limited … … … … 17
… … … … … 12
SRS Guangzhou Limited
16
Shenzhen King-Top Modern Hi-Tech Company Limited
Ordinary
India
Ordinary
China
Ordinary
Brazil
India
Ordinary
England and Wales Ordinary
Ordinary
India
Ordinary
Thailand
Ordinary
China
Ordinary
China
Ordinary
China
Holding Companies:
Goodwin Refractory Services Holdings Limited… …
Ying Tai (UK) Limited … … … … … …
1
1
England and Wales Ordinary
England and Wales Ordinary
Non-principal Associates:
Tet Goodwin Property Company Limited … … … 11
Dormant companies:
Gold Star Powders Limited … … … … …
Net Central Limited … … … … … …
Sandersfire International Limited … … … …
Specialist Refractory Services Limited … … …
1
1
1
1
Thailand
Ordinary
England and Wales Ordinary
England and Wales Ordinary
England and Wales Ordinary
England and Wales Ordinary
*The registered address for each company can be found in note 32.
All of the above companies are included as part of the consolidated accounts.
100
100
100
100
100
100
75
75
75
75
100
75
49
100
100
100
100
31. Related parties
Transactions between the Company and its subsidiaries have been eliminated on consolidation and are not
reported in this note. Year end balances and transactions during the year with the Group’s associate
companies are shown below.
2021 2020
£’000 £’000
TET Goodwin Property Company Limited
… … … … …
Rental cost …
Interest income
… … … … …
Receivable balance … … … … …
…
…
…
…
…
…
…
…
…
…
…
…
…
…
…
311
7
260
337
24
507
32. Registered offices of subsidiaries and associates
The registered offices of the companies listed in notes 14 and 30 are listed below.
Ivy House Foundry, Hanley, Stoke-on-Trent ST1 3NR
1.
2. Brassington, Nr. Matlock, Derbyshire DE4 4HF
3. 13-1, Jungbong-daero, 396 Beon-Gil, Seo-gu, Incheon, South Korea
4. No 39/1-5, Old Mahabalipuram Road, Kalavakkam, Thiruporur Chengalpattu District – 603110, India
5. Suite C, F1, Building #14, Xiya Road No.11, Waigaoqiao Free Trade Zone, 200131, Shanghai, China
6. Hocksteiner Weg 56, D - 41189 Mönchengladbach, Germany
7. Suite 1105, Building 1, Wanguocheng Moma, No.16 Changfeng West Street, Wanbailin District, Taiyuan,
Shanxi Province, 30021, China
8. Rua das Margaridas s/n, No. 70, Barrio Terra Preta - Mairipora – SP, CEP 07662-025, São Paulo, Brazil
9. Confidential Tax and Business Services, Level 1, 449 Gympie Road, Kedron Qld 4031, Australia
10. Koivupuistontie 34, 01510 Vantaa, Finland
11. 99/9 Moo5 Khlong Yong, Bhudhamontol, Nakhonpathom, 73170 Thailand
12. No.73, Jiao Xin Road, Lanhe Town, Nansha District, Guangzhou City, 511480, China
13. 400 metres North from Nan Zhai Committee, Xifuzhen Street, Chengyang District, Qingdao City, 266106, China
14. 238, 3rd Floor, OPG Tech Building Bangkhuntien-Chatalay, Samaedum Sub-district, Bangkhuntien District,
Bangkok 10150, Thailand
15. Unit 1 Bridgeway Business Park, Cnr Sam Green Road and Pinnacle Close, Tunney Extension 9, Germiston,
Gauteng, 1401, South Africa
16. No.2-1, Shanzixia Road, Dakang Community, Yuanshan Street, Longgang District, Shenzhen City, Guangdong
Province, China
17. 165 Minsheng Road, Lanhe Town, Nansha District, Guangzhou, China
82
NOTES TO THE FINANCIAL STATEMENTS
33. Share-based payment transactions
The Group had one share option scheme, the LTIP, the terms of which are outlined in the Directors’ Remuneration
Policy and Report on page 31. The scheme has now ended.
Grant date/ Method of Maximum Vesting Contractual life
employees settlement number of conditions of options
entitled instruments
Options granted on Equity 576,000 For every 10% Expiry date:
5th October, 2016 growth in TSR 30th April, 2019
to Executive 28,800 shares
Directors will vest
Awards entitle each holder to earn up to 1% of the share capital of the Company subject to the performance
condition.
An award vested and became exercisable over 0.05% of the share capital of the Company for every 10%
increase in the TSR of the Company at the end of the three financial years ending on 30th April, 2019 with
a base year of 2009 but excluding the growth already achieved up to 30th April, 2016.
Number of share options
Vested 1st May, 2019 … … … … … … … … 489,600
489,600
2021
2020
Outstanding at beginning of year … … … … … … … … 326,400
489,600
Exercised during the year … … … … … … … … 163,200
163,200
Share price at the date of exercise … … … … … … … … £30.45
£34.00
Exerciseable at end of year … … … … … … … … 163,200
326,400
83
34. Alternative performance measures
NOTES TO THE FINANCIAL STATEMENTS
Measure
Method of calculation / reference
2021
2020
Gross profit (£’000)
Revenue (£’000)
Consolidated statement of profit or loss, page 43
39,001
Consolidated statement of profit or loss, page 43 131,231
34,769
144,512
Gross profit as percentage of
revenue (%)
Gross profit / revenue
29.7
24.1
Operating profit (£’000)
Capital employed (£’000)
Consolidated statement of profit or loss, page 43
Note 26 (d), page 77
17,094
130,572
12,858
123,834
Return on capital employed (%)
Operating profit / capital employed
13.1
10.4
Net debt (£’000)
Net assets attributable to equity
holders of the parent (£’000)
Note 26 (d), page 77
17,431
18,817
Consolidated balance sheet, page 47
113,141
105,017
Gearing (%)
Net debt / equity, as above
15.4
17.9
Net profit attributable to equity
holders of the parent (£’000)
Net assets attributable to equity
holders of the parent (£’000)
Consolidated statement of profit or loss, page 43
12,494
7,866
Consolidated balance sheet, page 47
113,141
105,017
Return on investment (%)
Net profit / net assets
11.0
7.5
Revenue (£’000)
Average number of employees
Consolidated statement of profit or loss, page 43 131,231
1,129
Note 6, page 60
144,512
1,190
Sales per employee (£’000)
Group revenue / average employees
116
121
Consolidated statement of profit or loss, page 43
Annual post tax profit (£’000)
Depreciation owned assets (£’000)
Note 5, page 60
Depreciation right-of-use assets (£’000) Note 5, page 60
Amortisation and impairment (£’000) Note 5, page 60
Exclude operating
lease depreciation (£’000)
Note 5, page 60
13,006
5,696
972
1,566
8,340
5,874
827
1,328
(550)
(537)
Annual post tax profit +
depreciation + amortisation (£’000)
20,690
15,832
84
NOTES TO THE FINANCIAL STATEMENTS
GOODWIN PLC
COMPANY BALANCE SHEET
at 30th April, 2021
NON-CURRENT ASSETS
Property, plant and equipment … … … … … …
Investment properties … … … … … … …
Right-of-use assets… … … … … … … …
Investments … … … … … … … … …
Intangible assets … … … … … … … …
CURRENT ASSETS
Other receivables … … … … … … … …
Cash at bank and in hand
… … … … … …
Notes
C4
C4
C4
C5
C6
C7
2021
£’000
27,984
23,900
1,077
25,392
15,877
2020
£’000
22,210
24,811
3,202
25,801
15,531
94,230
91,555
28,609
3,783
26,383
111
32,392
26,494
TOTAL ASSETS
… … … … … … … …
126,622
118,049
CURRENT LIABILITIES
Borrowings … … … … … … … … …
Other payables … … … … … … … …
Provisions … … … … … … … … …
NON-CURRENT LIABILITIES
Borrowings … … … … … … … … …
Deferred income … … … … … … … …
Deferred tax liabilities … … … … … … …
C8
C9
C8
C10
920
7,570
300
13,958
5,515
-
8,790
19,473
30,116
981
2,737
13,009
1,034
1,118
33,834
15,161
TOTAL LIABILITIES … … … … … … … …
42,624
34,634
NET ASSETS … … … … … … … … …
83,998
83,415
EQUITY
Called up share capital … … … … … … …
C11
Share-based payments reserve
… … … … …
Profit and loss account … … … … … … …
753
5,244
78,001
736
5,244
77,435
TOTAL EQUITY
… … … … … … … …
83,998
83,415
Profit after tax for the year … … … … … … …
6,582
8,824
These financial statements were approved by the Board of Directors on 11th August, 2021 and signed on its behalf by:
T. J. W. Goodwin
Director
M. S. Goodwin
Director
S. R. Goodwin
Director
Company Registration Number: 305907
The notes on pages 87 to 96 form part of these financial statements.
85
NOTES TO THE FINANCIAL STATEMENTS
GOODWIN PLC
COMPANY STATEMENT OF CHANGES IN EQUITY
for the year ended 30th April, 2021
YEAR ENDED 30TH APRIL, 2021
Balance at 1st May, 2020
Total comprehensive income:
Profit for the year
… … … … …
… … … …
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR
Issue of shares … … … … … …
Dividends paid … … … … … …
Share-
based
payments
reserve
£’000
Share
capital
£’000
Retained
earnings
£’000
Total
equity
£’000
736
-
-
17
-
5,244
77,435
83,415
-
-
-
-
6,582
6,582
6,582
-
(6,016)
6,582
17
(6,016)
BALANCE AT 30TH APRIL, 2021
753
5,244
78,001
83,998
YEAR ENDED 30TH APRIL, 2020
Balance at 1st May, 2019
Total comprehensive income:
Profit for the year
… … … … …
… … … …
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR
Issue of shares … … … … … …
Other transactions
… … … … …
Dividends paid … … … … … …
720
-
-
16
-
-
4,991
75,538
81,249
-
8,824
8,824
-
-
253
-
8,824
-
-
(6,927)
8,824
16
253
(6,927)
BALANCE AT 30TH APRIL, 2020
736
5,244
77,435
83,415
The notes on pages 87 to 96 form part of these financial statements.
86
C1
Accounting policies
NOTES TO THE FINANCIAL STATEMENTS
Principal accounting policies
These financial statements present information about the Company as an individual undertaking and not
about its Group. These financial statements were prepared in accordance with Financial Reporting Standard
101 Reduced Disclosure Framework (“FRS 101”).
Basis of accounting
Goodwin PLC (the “Company”) is a company incorporated and domiciled in England and Wales.
These financial statements have been prepared in accordance with international accounting standards in
conformity with the requirements of the Companies Act 2006.
The Company proposes to continue to adopt the reduced disclosure framework of FRS 101 in its next financial
statements. The accounting policies set out below have, unless otherwise stated, been applied consistently
to all periods presented in these financial statements.
The consolidated financial statements of Goodwin PLC are prepared in accordance with International
Financial Reporting Standards and are available to the public and may be obtained from The Company
Secretary, Goodwin PLC, Ivy House Foundry, Hanley, Stoke-on-Trent, ST1 3NR.
The Company is exempt under S408 (3) Companies Act 2006 from the requirement to present its own profit
and loss account.
In these financial statements, the Company has applied the exemptions available under FRS101 in respect
of the following disclosures:
• A cash flow statement and related notes;
• Comparative period reconciliations for share capital, tangible fixed assets and intangible assets;
• Disclosures in respect of transactions with wholly-owned subsidiaries;
• Disclosures in respect of capital management;
• The effects of new but not yet effective IFRSs;
As the consolidated financial statements of Goodwin PLC include the equivalent disclosures, the Company
has also taken the exemptions under FRS101 available in respect of certain disclosures required by IFRS 13
Fair Value Measurement and the disclosures required by IFRS 7 Financial Instrument Disclosures.
Judgements made by the Directors, in the application of these accounting policies that have significant
effect on the financial statements and estimates with a significant risk of material adjustment in the next
year are discussed in note 2 of the Group financial statements.
Measurement convention
The financial statements have been prepared under the historical cost accounting rules and in accordance
with applicable Accounting Standards.
Investments in subsidiary undertakings
In the Company’s financial statements, investments in subsidiary undertakings are stated at cost less amounts
written off for impairment.
Foreign currency
Transactions in foreign currencies are translated to the respective functional currencies at the foreign
exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign
currencies at the balance sheet date are translated at the foreign exchange rate ruling at that date. Foreign
exchange differences arising on translation are recognised in the statement of profit or loss within
operating profit.
Financial instruments
Financial assets and financial liabilities are recognised on the Company’s balance sheet when the Company
has become a party to the contractual provisions of the instrument. The principal financial assets and
liabilities of the Company are as follows:
Principal non-derivative financial assets
Other receivables
Other receivables principally comprise short-term tax balances and receivables from Group undertakings.
After being recognised initially at fair value, other receivables are measured, subsequently, at amortised
cost. The carrying amount of other receivables is considered to be a reasonable approximation of their
fair value. A provision for expected credit losses (ECL) is not seen as necessary given that the
counterparties here are Group undertakings. The Company is privy to both the accounts and future
prospects of its subsidiary and associate companies. Accordingly, impairment provisions are raised
where the carrying value of a subsidiary company / associated company cannot be fully supported.
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand including cash deposits with an original
maturity of three months or less.
Bank overdrafts that are repayable on demand and form an integral part of the Company’s cash
management are included as a component of cash and cash equivalents for the purpose only of the
statement of cash flows.
87
NOTES TO THE FINANCIAL STATEMENTS
C1
Accounting policies (continued)
Financial instruments (continued)
Equity instruments
Equity instruments are stated at par value. For ordinary share capital, the par value is recognised in share
capital and the premium in the share premium reserve.
Principal non-derivative financial liabilities
Financial liabilities are classified according to the substance of the contractual arrangements into which
the Company has entered.
Bank borrowings
Interest-bearing bank loans and overdrafts are recorded initially at their fair value less attributable
transaction costs. They are subsequently carried at their amortised cost and finance charges and are
recognised in the statement of profit or loss over the term of the instrument using an effective rate
of interest.
Trade and other payables
Trade and other payables are recognised initially at fair value and subsequently at amortised cost using
the effective interest method where material.
Intangible fixed assets and amortisation
Manufacturing rights, brand names and customer lists purchased by the Company are amortised to nil
by equal annual instalments over their estimated useful lives. Expenditure on development activities is
capitalised if the product or process is technically and commercially feasible and the Company has sufficient
resources to complete development. The expenditure capitalised includes the cost of materials, direct labour
and an appropriate proportion of overheads.
Amortisation rates are as follows:
Manufacturing rights … … … … … 11 - 15 years
Brand names … … … … … … 20 years
Software and licences
Intellectual property rights … … … … 15 - 20 years
Non-compete agreements … … … … 2 - 15 years
Capitalised development costs … … … Minimum expected order unit intake or
… … … … 3 - 5 years
minimum product life
… … … … … … over estimated production life
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses.
Where parts of an item of property, plant and equipment have different useful lives, they are accounted for
as separate items of property, plant and equipment.
Depreciation is charged to the statement of profit or loss over the estimated useful lives of each part of an
item of property, plant and equipment on the following bases:
Freehold land … … … … … … Nil
Freehold buildings … … … … … 2% to 4% on reducing balance or cost
Plant and machinery … … … … … 5% to 25% on reducing balance or cost
Motor vehicles … … … … … … 15% or 25% on reducing balance
Tooling
Other equipment … … … … … 15% to 25% on reducing balance
Assets in the course of construction are not depreciated.
Investment properties
Investment properties are properties which are held either to earn rental income or for capital appreciation
or for both. Investment properties are stated at cost less accumulated depreciation.
Depreciation is charged to the statement of profit or loss on a straight-line basis or reducing balance over the
estimated useful lives of investment properties which is typically 25 years.
Government grants
Government grants relating to income are recognised in the statement of profit or loss.
Unamortised government grants relating to property, plant and equipment are recognised in the balance
sheet as a deferred creditor. Amortisation of such grants is credited to profit and loss in accordance with the
useful lives of the assets to which they relate.
Provisions
A provision is recognised in the balance sheet when the Company has a present legal or constructive
obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required
to settle the obligation. 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.
Leases
Definition of a lease
A contract is a lease or contains a lease if it transfers the right to use an identified asset over the contract
term, in exchange for payment. In determining whether a contract gives the Company the right to use an
asset, the Company assesses whether:
88
C1
NOTES TO THE FINANCIAL STATEMENTS
Accounting policies (continued)
Leases (continued)
Definition of a lease (continued)
• the contract involves the use of an identified asset;
• the Company has the right to obtain substantially all of the economic benefit of using the asset; and
• the Company has the right to direct the use of the asset by deciding how the asset is employed.
Lease term
The lease term is the non-cancellable period of a lease, and options to extend the lease or terminate it, where
it is probable that the Company will exercise the available options. At the start of a lease, the Company makes
a judgement about whether it is reasonably certain to exercise the options, and reassesses this judgement at
every reporting period. Contracts, where the original lease term has expired, with assets continuing to be
leased on a short-term rolling basis of a few months, are treated as short-term leases.
Lease balances
A right-of-use asset and a lease liability are calculated at the beginning of a lease. The right-of-use asset is
measured initially at cost, being the opening lease liability, adjusted for any lease payments made by the start
of the lease, adjusted for any initial direct costs, which have been incurred.
The lease liability is measured initially at the present value of the lease payments, which are outstanding at
the start date, discounted at either the rate implicit in the lease or the Company’s incremental borrowing rate.
With the exception of leases containing an option to purchase, the Company uses its incremental borrowing
rate as the discount rate. Lease liabilities are measured at amortised cost, using the effective rate, and
adjusted as required for any subsequent change to the lease terms.
The right-of-use asset is depreciated on a straight-line basis over the lease term, or from the start date of
the lease to the end of the useful life of the right-of-use asset as appropriate. The method of calculating
the estimated useful lives of the right-of-use assets and testing for impairment is the same as that for
property, plant and equipment.
Recognition exemptions
Payments for short-term leases, lasting twelve months or less, without a purchase option, continue to be re-
ported an as operating expense on a straight-line basis over the term of the lease.
The cost of leasing low-value items will continue to be reported as an operating expense over the life of the
lease.
Financial expenses
Financial expenses comprise interest payable and interest on finance leases using the effective interest
method together with the amortisation of any facility arrangement fees. Borrowing costs that are directly
attributable to the acquisition, construction or production of an asset which takes a substantial time to be
prepared for use are capitalised as part of the cost of that asset.
Interest income and interest payable is recognised in the statement of profit or loss as it accrues.
Pension costs
The Company contributes to a defined contribution pension scheme for employees under an Auto
Enrolment Pension arrangement as required by Government legislation. The assets of the scheme are held
in independently administered funds. Company pension costs are charged to the statement of profit or
loss in the year for which contributions are payable.
Taxation
Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the statement
of profit or loss except to the extent that it relates to items recognised directly in equity, in which case it is
recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous
years.
Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes. The amount of deferred tax
provided is based on the expected manner of realisation or settlement of the carrying amount of assets and
liabilities, using tax rates enacted or substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be
available against which the asset can be utilised.
Share-based payment transactions
Share-based payment arrangements, in which the Company receives goods or services as consideration for
its own equity instruments, are accounted for as equity-settled share-based payment transactions, regardless
of how the equity instruments are obtained by the Company.
The grant date fair value of share-based payment awards granted to employees is recognised as an
employee expense, with a corresponding increase in equity, over the period in which the employees
become unconditionally entitled to the awards. The fair value of the awards is measured using an option
valuation model, taking into account the terms and conditions upon which the awards were granted.
89
NOTES TO THE FINANCIAL STATEMENTS
C2
Auditor’s remuneration
Included in the profit / (loss) before taxation are the following:
Fees receivable by the auditors and the auditor’s associates in respect of:
Audit of these financial statements
… … … … … … …
2021
£’000
2020
£’000
40
45
Amounts paid to the Company’s auditor in respect of services to the Company, other than the audit of the
Company’s financial statements, have not been disclosed as the information is required instead to be
disclosed on a consolidated basis (see note 5 of the Group financial statements).
C3
Staff numbers and costs
The average number of persons employed by the Company (including Directors) during the year, analysed
by category, was as follows:
Number of employees
2021 2020
Administration staff … … … … … … … … … … 49 51
2021 2020
£’000 £’000
The aggregate payroll costs of these persons were as follows:
Wages and salaries … … … … … … … … … … 4,055 3,730
Social security costs … … … … … … … … … … 1,902 469
Other pension costs … … … … … … … … … … 99 98
6,056 4,297
Details of the Directors’ remuneration can be found within the Directors’ Remuneration Report on pages
29 and 30. The emoluments of the highest paid Director were £355,000 (2020: £310,000). The number of
Directors who were members of a defined contribution pension scheme was 6 (2020: 6). The social
security costs include £1.4 million in respect of employer’s national insurance relating to exercised share
options under the Executive Directors Long Term Investment Plan.
90
NOTES TO THE FINANCIAL STATEMENTS
C4
Tangible fixed assets
Investment
properties
Property, Plant and Equipment
Cost
Balance at 1st May, 2020
… …
Additions
Reclass - Other … …
Reclass ROU* … …
Disposals
… …
Intercompany transfers
£’000
30,562
663
-
-
(632)
-
Other
Land and Plant and equipment
buildings machinery
£’000
Assets in
course of
** construction
£’000
£’000
£’000
1,166
-
-
-
-
-
34,352
280
(186)
4,045
(30)
(36)
1,703
103
157
-
(85)
-
1,982
4,320
29
-
(75)
-
Total
£’000
39,203
4,703
-
4,045
(190)
(36)
Balance at 30th April, 2021 30,593
1,166
38,425
1,878
6,256 47,725
Depreciation
Balance at 1st May, 2020
Charged in the year …
Reclass ROU* … …
Reclass other … …
Disposals
… …
Intercompany transfers
5,751
942
-
-
-
-
664
19
-
-
-
-
15,127
1,648
1,045
(133)
-
(7)
1,202
108
-
133
(65)
-
-
-
-
-
-
16,993
1,775
1,045
-
(65)
(7)
Balance at 30th April, 2021
6,693
683
17,680
1,378
- 19,741
Net book value
At 30th April, 2020 …
24,811
502
19,225
At 30th April, 2021
23,900
483
20,745
501
500
1,982
22,210
6,256 27,984
*
This is a transfer from the right-of-use assets category on the settlement of a lease purchase agreement
and payment of the option to purchase fee.
** Other equipment comprises motor vehicles, IT hardware and office equipment.
A bank loan of £4 million is secured against three furnaces (see note C8).
The Company’s investment properties have been valued, using the cost model, and depreciated over their
estimated useful lives – typically 25 years. In the opinion of the Directors, the fair value of the investment
properties as at 30th April, 2021 was estimated to be £47 million (2020: £45 million). Fair value for this
purpose is based on Level 3 fair value inputs and, specifically, the Directors’ opinion as to the amount
for which the property could be exchanged between knowledgeable, willing parties in an arm’s length
transaction given a reasonable timeframe in which to conclude such an exchange. There has not been a
valuation by an independent valuer.
91
NOTES TO THE FINANCIAL STATEMENTS
C4
Tangible fixed assets (continued)
Right-of-use assets
Cost
Balance at 1st May, 2020 … … … … …
Additions
… … … … … … …
Transfer to tangible fixed … … … … …
Plant and
machinery
£’000
Other
equipment
£’000
4,045
-
(4,045)
-
1,181
-
Total
£’000
4,045
1,181
(4,045)
Balance at 30th April, 2021
-
1,181
1,181
Depreciation
Balance at 1st May, 2020 … … … … …
Charged in the year … … … … … …
Transfer to tangible fixed … … … … …
Balance at 30th April, 2021
Net book value
At 30th April, 2020 … … … … … …
At 30th April, 2021
C5
Fixed asset investments
Cost
Balance at 1st May, 2020 … … … … …
… … … … … … …
Disposals
Balance at 30th April, 2021
Impairment
Balance at 1st May, 2020 … … … … …
Balance at 30th April, 2021
Net book value
At 30th April, 2020 … … … … … …
At 30th April, 2021
843
202
(1,045)
-
3,202
-
-
104
-
104
843
306
(1,045)
104
-
3,202
1,077
1,077
Shares in
associated
undertakings
£’000
Shares in
Group
undertakings
£’000
Total
£’000
237
-
237
-
-
237
237
31,477
(409)
31,714
(409)
31,068
31,305
5,913
5,913
5,913
5,913
25,564
25,801
25,155
25,392
A list of principal subsidiaries and associates is given in note 13 and a list of non-principal subsidiaries and
associates is given in note 30 of the Group financial statements.
The disposal in the year is due to the dissolution of Goodwin (Shanxi) Pump Company Limited.
92
NOTES TO THE FINANCIAL STATEMENTS
C6
Intangible assets
Brand names
and Manu- Software Develop-
ment
intellectual facturing
costs Total
property rights
£’000 £’000
£’000 £’000
and
Licences
£’000
Cost
Balance at 1st May, 2020 … … … 7,866 2,247
Additions … … … … … 18 -
Intercompany transfers in … … … - -
Intercompany transfers out … … - -
Disposals … … … … … - -
289
133
-
-
(6)
8,685 19,087
- 151
1,409 1,409
(105) (105)
(25) (31)
Balance at 30th April, 2021 7,884 2,247
416
9,964 20,511
Amortisation
Balance at 1st May, 2020 … … … 1,120 1,476
Amortisation for the year … … … 422 121
Impairment charge … … … … - -
Disposals … … … … … - -
133
109
-
(6)
827 3,556
437 1,089
20 20
(25) (31)
Balance at 30th April, 2021 1,542 1,597
236
1,259 4,634
Net book value
At 30th April, 2020 … … … … 6,746 771
At 30th April, 2021 6,342 650
156
180
7,858 15,531
8,705 15,877
C7
Debtors
Interest-bearing
Amounts owed by Group undertakings – repayable on demand
… …
Amounts owed by Group undertakings – repayable within five years … …
Non interest-bearing
Amounts owed by Group undertakings – repayable on demand
… …
Amounts owed by Group undertakings – repayable within five years … …
Other debtors … … … … … … … … … … …
… … … … … … …
Prepayments and accrued income
Corporation tax receivable… … … … … … … … …
2021
£’000
8,038
-
18,759
602
240
813
157
2020
£’000
5,229
2,782
17,095
598
202
439
38
28,609
26,383
C8
Borrowings
This note provides information about the contractual terms of the Company’s interest-bearing bank loans and
borrowings. For more information about the Group’s exposure to interest rate and foreign currency risk,
see note 26 of the Group financial statements.
Non-current liabilities
Finance lease liabilities … … … … … … … … … …
757
Bank loans and committed facilities … … … … … … … … 26,000
3,359
Bank loans repayable by instalments
… … … … … … …
2021
£’000
2020
£’000
-
9,000
4,009
Current liabilities
Finance lease liabilities … … … … … … … … … …
Bank loans and committed facilities … … … … … … … …
… … … … … … …
Bank loans repayable by instalments
Bank overdrafts … … … … … … … … … … …
30,116
13,009
230
-
690
-
920
859
12,000
657
442
13,958
93
NOTES TO THE FINANCIAL STATEMENTS
C8
Borrowings (continued)
Lease liabilities
Finance Lease liabilities are payable as follows:
Less than one year
Between one and five years
2021
2020
Minimum
lease
payments
£’000
264
799
Interest Principal
£’000
230
757
£’000
34
42
Minimum
lease
payments
£’000
872
-
Interest Principal
£’000
859
-
£’000
13
-
1,063
76
987
872
13
859
Bank loan repayable by instalments
The loan is secured against three furnaces (see note C4). Bank loans are payable as follows:
2021
2020
Minimum
loan
payments
£’000
807
3,208
399
Interest Principal
£’000
690
2,964
395
£’000
117
244
4
Minimum
loan
payments
£’000
795
3,180
1,192
Interest Principal
£’000
657
2,846
1,163
£’000
138
334
29
4,414
365
4,049
5,167
501
4,666
Less than one year
Between one and five years
More than five years
C9
Other payables
2021
£’000
352
4,596
372
1,890
360
7,570
2020
£’000
1,164
2,535
784
617
415
5,515
2020
£’000
1,118
1,619
2,737
2020
£’000
3,009
(1,888)
(3)
1,118
Trade payables… … … … … … … … … … …
Amounts owed to Group undertakings – interest-bearing… … … …
Amounts owed to Group undertakings – non interest-bearing … … …
… … … … … … …
Other taxation and social security
Accruals and deferred income … … … … … … … …
C10 Provisions for deferred tax
Deferred taxation
Balance at 1st May, 2020
… … … … … … … … … … …
Recognised in the statement of profit or loss … … … … … … … …
Balance at 30th April, 2021… … … … … … … … … … …
The elements of deferred taxation are as follows:
Difference between accumulated depreciation and
amortisation and capital allowances … … … … … … …
Share-based payment reserve … … … … … … … … …
Other temporary differences … … … … … … … … …
Within the current and previous year, the Company has no unrelieved tax losses.
2021
£’000
3,656
(915)
(4)
2,737
94
NOTES TO THE FINANCIAL STATEMENTS
C11 Called up share capital
Authorised, allotted, called up and fully paid:
… … … …
7,362,200 (2020: 7,200,000) ordinary shares of 10p each
Issue of 163,200 ordinary shares of 10p each … … … … … …
2021
£’000
736
17
753
2020
£’000
720
16
736
Details of the share issue are contained in note 33 of the Group financial statements.
C12 Contingent liabilities
The Company is jointly and severally liable for value added tax due by other members of the Group
amounting to £216,000 (2020: £Nil).
C13 Related Party Transactions
The Company has applied the exemptions available under FRS 101 in respect of the disclosure of transactions
with wholly-owned subsidiary companies. The Company has transacted with Easat Radar Systems Limited,
Goodwin Korea Company Limited, Internet Central Limited, Jewelry Plaster Limited, NRPL Aero Oy, Siam
Casting Powers Limited, Ultratec Jewelry Supplies Limited and Ying Tai (UK) Limited which are not
wholly-owned subsidiaries.
Transactions and balances are summarised below:
2021
£’000
… … … … … … … …
… … … … … … … …
… … … … … … … …
… … … … … … … …
… … … … … … … …
… … … … … … … …
Interest receivable
Interest payable
Dividend income
Management fee income
Rental income
Royalty income
Interest-bearing balances
Amounts owed by Group undertakings – repayable on demand … … … 8,038
Amounts owed by Group undertakings – repayable within five years
-
Non interest-bearing balances
Amounts owed to Group undertakings – repayable on demand
Interest-bearing balances
Amounts owed to Group undertakings – repayable on demand
239
11
389
536
213
218
… … … 2,011
… … … 1,631
… …
2020
£’000
238
10
-
810
257
-
5,229
2,782
-
1,837
Compensation of key management personnel
Key management personnel are defined in the Directors’ Remuneration Report on page 27, and their
remuneration is disclosed on pages 29 to 30 of the Group financial statements. Some of the Executive
Directors are party to an Equity Long Term Incentive Plan (LTIP). Further details of the LTIP can be found in
note 33 of the Group financial statements.
C14 Commitments
Contracted capital commitments at 30th April, 2021 for which no provision has been made in these financial
statements were £142,000 (2020: £Nil).
C15 Subsequent events
After the balance sheet date, ordinary dividends were declared of £7,862,000, which have not been provided
for within these financial statements
On 2nd July, 2021, the Company contracted to convert £30 million of notional debt in to a fixed rate of less
than 1% versus the floating inter-banking lending rate (SONIA) for a period of ten years. With the level of
expected trade and the opportunities open to the Group going forwards, the Directors deemed it prudent
to fix its variable lending rate at what is perceived to be a favourable rate over this time frame.
C16 Dividends
Paid ordinary dividends during the year in respect of prior years
81.71p (2020: 96.21p) per qualifying ordinary share… … … … …
2021
£’000
6,016
2020
£’000
6,927
After the balance sheet date an ordinary dividend of 102.24p per qualifying ordinary share was proposed by
the Directors (2020: Ordinary dividend of 81.71p).
The proposed current year ordinary dividend of £7,862,000 has not been provided for within these financial
statements (2020: Proposed ordinary dividend of £6,016,000 was not provided for).
95
NOTES TO THE FINANCIAL STATEMENTS
C17 Accounting estimates and judgements
The material accounting estimates and judgements for the Company follow that of the Group which have
been considered in note 2 of the Group financial statements.
C18 Share-based payment transactions
Details of the equity-settled share-based payment transactions are disclosed in note 33 of the Group financial
statements.
96
FIVE YEAR FINANCIAL SUMMARY
Continuing operations
2017
£’000
2018
£’000
2019
£’000
2020
£’000
2021
£’000
Revenue… … … … … … … …
… … … … …
Profit before taxation
Tax on profit … … … … … … …
Profit after taxation … … … … … …
131,587
9,244
(2,487)
6,757
124,811
13,300
(3,865)
9,435
127,046
16,410
(3,963)
12,447
144,512
12,115
(3,775)
8,340
131,231
16,514
(3,508)
13,006
Basic earnings per ordinary share
… … …
Diluted earnings per ordinary share … … …
84.47p
84.47p
118.11p
118.11p
159.79p
159.79p
107.93p
103.31p
167.82p
164.23p
Total equity … … … … … … …
93,661
104,827
109,291
109,602
118,028
97