Report & Accounts 2022
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Expona Commercial
Polysafe Wood fx
Beechfield
Hollinhurst Road
Radcliffe
Manchester
M26 1JN
Tel +44 (0)161 767 2500
Fax +44 (0)161 766 7499
www.jameshalstead.com
JH-Accounts-Cover-2022-ARTWORK.indd All Pages
JH-Accounts-Cover-2022-ARTWORK.indd All Pages
04/10/2022 15:05
04/10/2022 15:05
Nominated adviser and stockbrokers
Panmure Gordon & Co
One New Change
London
EC4M 9AF
Stockbrokers
WH Ireland
24 Martin Lane
London
EC4R 0DR
Auditor
BDO LLP
3 Hardman Street
Spinningfields
Manchester
M3 3AT
Directors and Advisers
Directors
J A Wild FCA
M Halstead
G R Oliver FCA MCT
S D Hall
M J Halstead
R P Whiting
Secretary
D N Fletcher ACMA ACG
Registered office
Beechfield
Hollinhurst Road
Radcliffe
Manchester
M26 1JN
Company registration No.
140269
Website
www.jameshalstead.com
Bankers
National Westminster Bank plc
1 Hardman Boulevard
Manchester
M3 3AQ
Registrars
Link Group
Central Square
29 Wellington Street
Leeds
LS1 4DL
HM Queen Elizabeth II
1926 – 2022
Polyflor was created in 1950. At the time it seemed to many as if Britain was losing its way in
the post war world, but many more were optimistic. The newly formed NHS and the extension
of the welfare state were part of what was to become the new Elizabethan age. Our company,
and many others, were engaged in a seller’s market exporting our goods, initially to the
Commonwealth countries and then extending globally. HM Queen Elizabeth II travelled the
world throughout the following years as our head of state. Her honesty, sincerity, sense of duty
and service reflected back, in no small way, on the many businesses that exported from this
relatively small nation.
Trusted, reliable and constant.
I had the honour to meet the Queen when we were presented with the Queen’s Award for
Enterprise, as did others from our business as further awards followed. I can speak for all our
employees from the shop floors of Manchester and Teesside, to our offices in Germany,
Australia, France, Asia, Scandinavia, New Zealand, Canada, India and South America – you
served us well your Majesty.
Thank you. May you Rest in Peace.
Geoffrey Halstead
President
1
Contents
Strategic Report
Chairman’s Statement 2
Chief Executive’s Review 5
Financial Director’s Review 7
Section 172 Statement 11
Governance
Report of the Directors 13
Board Report on Remuneration 17
Corporate Governance 18
Financial Statements
Independent Auditor’s Report to the Members
of James Halstead plc 24
Consolidated Income Statement 30
Consolidated Statement of Comprehensive Income 31
Consolidated Balance Sheet 32
Consolidated Statement of Changes in Equity 33
Consolidated Cash Flow Statement 34
Notes to the Consolidated Financial Statements 35
Company Balance Sheet 61
Company Statement of Changes in Equity 62
Notes to the Company Financial Statements 63
Supplementary Information
Ten Year Summary 70
Shareholder Information 71
Notice of Annual General Meeting 72
Chairman’s Statement
Results
Revenue for the year at £291.9m (2021: £266.4m) is 9.6%
ahead of the comparative year.
Underlying operating profit is £51.1 million (2021:
£51.3m) – 0.4 % below last year. The reported profit for
the year of £52.2m differed from this due to the one-off
effect of insurance pay-outs in respect of the breakdown of
one of the major production lines at our Radcliffe
manufacturing plant in September 2019.
As I wrote in our trading update on 1 August 2022, the
second half of the year has been, on the one hand, a period
of full production for our factories in the UK but also with
its challenges. The optimism at the start of the year on the
decline of Covid-19, related supply problems and greater
availability of
labour was offset by a myriad of
shortages/cost increases following the invasion of the
Ukraine. Transport, fuel and energy increases were
immediately obvious and whilst a significant issue during
the spring/summer period, we have been mindful that the
autumn/winter period may bring deeper problems. The
most obvious effect on our business has been our decision
to increase stockholdings as we sought to mitigate the
risks associated with
to
manufacture. This, in our view, seemed judicious and
hopefully is over-cautious. In the event that the crisis does
not escalate, then it is likely we will temporarily suspend
some production for a period to bring stock levels back to
normal.
the potential
inability
Trading margins during the year decreased but are
acceptable given the flood of cost increases that we have
in part passed on. As I noted in the last two years’ trading
updates, this period was again not normal. For example, in
some flooring projects that have been severely delayed, we
have honoured the prices originally quoted to preserve the
volume needed to feed our production lines. In other
instances, we have re-priced to find volume still goes
elsewhere and in many cases we have re-priced again and
retained the business. This is the nature of our industry
with over-capacity of supply and at least one global
competitor has fallen into receivership on the back of
facing similar issues. Whilst some other industries have
priced daily on the back of this difficult situation, we have
2
walked a more cautious path and I commend our teams
that collectively have been successful in managing the
challenges we face.
There have been some positives in the midst of a generally
difficult trading environment. The general boycott in
Russian trade has eased the widespread shortage of
shipping containers that has prevailed since Covid-19
disrupted normal shipping routes. Similarly, with Russian
bound supplies of certain raw materials facing export
restrictions there was, at times, more availability to our
factories as these were diverted back into the European
market. Overall it was a difficult period for manufacturing.
The company and our strategy
James Halstead is a group of companies involved in the
manufacture and supply of flooring for commercial and
domestic purposes, based in Bury UK. James Halstead plc
has been listed on the London Stock Exchange for nearly 75
years.
The group was established in 1914 and continues to
operate out of the original premises in Bury. In its factories
in Bury and Teesside it manufactures resilient flooring for
distribution in the UK and worldwide.
The company’s strategy is to constantly develop its brand
identity and its reputation for quality, product innovation,
durability and availability, thereby enhancing and
maintaining goodwill with the aim of achieving repeat
business. Our focus is to work with stockists who in turn
distribute those bulk deliveries whilst promoting and
representing the products to the end users and specifiers
who will purchase the stock from those stockists.
This approach is designed to increase and secure revenue
streams and drive profitability and cash flow which enables
the continuation of dividends thereby creating shareholder
wealth. In the normal course of business one key element
of the company ethos is having dedicated sales personnel
to present our product to our customers’ clientele.
Over many years our strategy has also included a policy of
continual investment in both process improvement and in
product development to improve output efficiency and
product offering.
3
Chairman’s Statement
continued
Corporate governance and corporate
social responsibility and the
environment
The board has over many years recognised its responsibility
towards good corporate governance. It is part of our
character and, I believe, contributes to our ability to deliver
long-term shareholder value. Increasingly companies are,
quite rightly, tasked with demonstrating that their
environmental credentials and supply chain management
are supported by social and sustainability dimensions with
appropriate stewardship.
We can say, with some pride, that almost 100% of our
electric usage is now derived from renewables. Our bi-
annual Sustainability Report was published in 2021 and we
have this report independently audited to further under-
line our credentials. (Available to download on our website).
PVC polymer is one of our main raw materials and we
began recycling waste into our processes in the 1950s and
have continued to use waste PVC as part of the process of
manufacturing in ever increasing volumes. For many years
we have funded waste collection with Recofloor – our UK
joint venture that collects post installation waste PVC
within our industry. We are also founder members of the
European PVC recycling venture, the AgPr, which funds the
recycling of post-consumer PVC waste and diverts waste
from landfill back into the manufacturing process.
An important point to note about PVC is that it has evolved
and it is no longer just derived from petrochemicals. It is
increasingly produced from bio-mass. Indeed, many of the
by-products of PVC manufacturing are indispensable to the
medical and food industries. PVC manufacture has the
lowest consumption of primary energy of any of the major
commodity plastics and our PVC flooring is made with over
80% renewable materials. Our recycling initiatives further
reduce our footprint on the environment.
As part of our focus on the future and the footprint of our
industry we are major partners in industry wide bodies. We
are, for example, active members of the ERFMI (the
European Resilient Flooring Manufacturing Institute).
ERFMI activities range from involvement in the EU carbon
neutral strategy through to funding new recycling
initiatives to extend the ability of PVC to be recovered and
recycled.
The UK may have left the European Union but our work on
standards, the circular economy, sustainability and
meaningful recycling is both Europe wide and globally
focused and is progressing at pace. In no way has “Brexit”
lessened our involvement as Europeans in the flooring
industry.
Dividend
Our cash balances stand at £52.1 million (2021: £83.3
million) with the major reason for the reduction being,
obviously, increased stock. The inventory at the year end is
£112.3 million (2021: £60.7 million) which is about 85%
higher than the prior year comparative.
Also of note regarding the cash flow for the year is taxation
paid of £9.9 million (2021: £9.9 million) – unchanged and
equity dividends paid of £32.3 million (2021: £34.1 million)
– down 5.3%.
Having this large investment in our stockholdings and with
the challenges facing our companies in terms of cash flow,
the Board do not propose to increase the final dividend
which will remain at the level of last year and will be paid
in December 2022.
The interim dividend of 2.25p (2021: 4.25p) was paid in
June 2022.
Acknowledgements
As is customary, I would like to thank our staff for their
continued efforts in achieving this year’s result.
In addition, I feel I must note the death of HM Queen
Elizabeth II. The brand ‘Polyflor’ was created in 1950, just
prior to start of her reign. Her Majesty’s service over the
years since has no doubt been the rock on which the
reputation of the United Kingdom has been built and helped
in the growth of our exports over the last 70 years.
Our thanks also to the UK Contract Flooring Association for
their members’ accolades with Polyflor being awarded the
2022 Manufacturer of the Year, as well as the Healthcare
Installation of the Year (Kitwood House Care Home in
Cheshire) and International Installation of the Year (Live
Sport Offices, Prague).
4
Outlook
Trading from the year-end to date has been positive. Post
year end, prices have been increased and demand has
remained strong.
Sales volume is higher and we have continued to pass on
cost increases. Costs, most particularly energy, have
continued to rise. The fall in the value of sterling, most
markedly against the US dollar, in recent days will no doubt
have implications to certain input costs but equally, given
our level of exports, will have some positives.
We cannot forecast the effects of energy costs on the
myriad of materials and goods that are needed to
undertake mass volume manufacture but with the vast
array of skills, knowledge and entrepreneurs within our
collective, each challenge should be overcome.
In the light of current demand, with the accumulated
industry experience at our disposal, I, and the Board, remain
confident of progress over
term,
notwithstanding the short term challenges I have
highlighted in my statement.
the medium
Anthony Wild
Chairman
30 September 2022
5
Chief Executive’s Review
As noted by the Chairman, it has been a mixed year. For the
largest input costs to our manufacturing we have had to
accept price increases. Be it energy or raw materials it has
been a constant adverse situation. The simple idea that
these costs are passed on is complicated.
(a)
(b)
(c)
Complicated by the project related nature of
quotations and the time from quotation to
supply of the stock, reality of losing business at
high prices or maintaining it at a loss.
Complicated by the fact that at least two
generations that have never seen inflation of
this scale and who are partly in denial as to its
reality, duration and implications.
Complicated by the possibility that this may yet
affect the continuous production we have
enjoyed over many, many years.
These challenges are faced by many of our European
competitors and inevitably there is a degree of margin
erosion which manufacturers from all types of industry face.
Reviewing the businesses in more detail:
Objectflor/Karndean and James
Halstead France, our European
operations
In Germany sales growth of near 12% came largely from
cost surcharges and price increases as costs increased during
the year. In one of the most competitive markets for
flooring, volumes were maintained. The year was one of two
halves with the earlier part facing stock shortages due to
adverse shipping conditions. There were key product
launches that were delayed by both the availability of
complete stock ranges and difficulties in supply of
marketing materials to support launches. The stock situation
improved as the year progressed.
In France sales were increased by 18%, volumes also
increased though by a lesser percentage. Investments in
regional sales teams were key to the sales growth. Stock
levels have grown, once again largely planned in the
expectation of supply problems.
Polyflor Pacific – encompassing
Australia, New Zealand and Asia
In Australia, sales were some 6% ahead of the prior year
with increases in profitability that resulted from increased
margin due to favourable product mix and staff costs
savings compared to the prior year. The staff savings were
the result of difficulties in recruitment leaving vacancies for
periods of time. The favourable product mix was due to
higher margin domestic flooring sales having taken a larger
proportion of sales than commercial flooring. This was, no
doubt, in part because Covid-19 restrictions were in place
for a long part of the first half financial year. Freight costs,
as with all markets, were greater. Stock levels increased.
In New Zealand sales were lower than the comparative year.
This market had the longest Covid restrictions of our major
markets. Operational restrictions impacted the economy
and the building sector in particular. Supplying New Zealand
was challenging with shipments of flooring from the UK
taking up to 8 months from order due to sea freight
complexities such as shortages of shipping containers in
Europe and severe congestion in ports such as Singapore.
The supply of flooring into nationwide social housing
contracts continues to be an important source of revenue
and will continue as backlogs in the roll-out programme
alleviate. One negative was the supply of cushion vinyl from
European manufacturers which was severely disrupted.
Nevertheless, it is pleasing to report increased market share
and customer satisfaction – largely due to our company
having stock and offering service levels far better than
competitors. Stock levels have been increased.
This was the first full year of our Malaysian business (which
also covers the South Eastern markets of Indonesia,
Singapore, Thailand, Vietnam and the Philippines) and we
can be satisfied with the progress made to date. The start of
the year was again hampered by various lockdowns and
travel movements across the territories, but as the year
progressed, we saw the order book and sales grow, with sales
across the region 153% ahead of last year.
The order book remains healthy, and we have every
expectation that sales will continue to grow. At the end of
the financial year, we strengthened the sales team further
by employing salespeople directly in Vietnam and Thailand
to support the distributors, and similar plans are in place for
the Philippines before the end of 2022.
Polyflor & Riverside Flooring, based in
UK
We continue to see growth in the heterogeneous ranges
manufactured at Teesside, and a falloff in certain of the
‘older’ ranges manufactured in Radcliffe. Overall volumes
were maintained. Output was increased as we returned to a
situation of being able to run all production lines, albeit with
continued absenteeism levels that are above the “normal”
levels that existed prior to the Covid-19 pandemic.
The increase in energy and raw material costs have put
pressure on our margins and whilst we have a proportion of
6
South America up 48% and the Middle East up 59%. In
some instances the comparative for 2021 was affected by
the impact of the Covid-19 virus (most notably in Spain). It
is pleasing to see these markets have recovered, this has
been hard to achieve with the cost of international freight
and equally as problematical have been delays and
difficulties in available shipping. The markets that did not
grow in the year were Africa and North Asia.
The North Asia markets have experienced a challenging year
due to the increase in Covid-19 cases and the “zero-Covid”
policy adopted across China. This meant our local
warehouse in China, which became operational last year
supplying smaller and local orders, as well as being able to
support other Asian markets, could not despatch products.
Several larger Asian projects, which are shipped direct, have
been delayed. Latterly we have started to see some
improvement but sales for 2022 fell by 28% against the
previous year.
In conclusion
Given the circumstances we can only be pleased with the
results for the year. The hard work, dedication and
experience of our subsidiary directors and management has
been a key factor in this achievement.
However, the challenges have not lessened.
Mark Halstead
Chief Executive
30 September 2022
our energy consumption on forward contracts, costs
continue to rise to unprecedented levels. The recent
announcement by the government, whilst welcome, will
only limit the increase, not reduce it. Availability of raw
materials has improved, but costs remain high. The impact
of rising energy costs on the production costs has been a
significant issue.
We have made several price increases during the year across
our ranges and across all markets to pass on these increases.
This continues to be the case after the year end.
Stocks in the UK also increased, both in manufactured and
merchanted goods. Delays in product launches earlier in the
year compounded the issue as we waited for marketing
material, such as shade cards and display boards. This was
another fallout of the Ukraine war due to the lack of wood
pulp and related materials.
Polyflor Nordic comprising Polyflor
Norway based in Oslo and Falck
Design based in Sweden
The markets have been re-organised to bring both Norway
and Sweden under one reporting structure. In Norway sales
are 17% ahead of the prior year largely supported by price
increases. Net profit rose by just under 6%. Heterogeneous
flooring (supplied by Riverside) grew and there has been
investment in additional staff in internal sales and regional
sales areas. In Sweden, sales increased 37% and the volume
of product supplied from our UK factories increased by near
50%. It must be noted that the prior year comparatives
were subdued by Covid-19 but nevertheless this is a good
result for both countries.
Polyflor Canada, based in Toronto
A record year for sales and a significant increase in net profit
against a generally sluggish economy. Our market share is
still embryonic in this market but with the shadow of Covid-
19 having crippled travel for much of the financial year this
was a creditable performance. Our Canadian business is very
largely project based and these have faced delays in funding
and progress but the business is well placed for further
growth.
Rest of the World
Our products are sold in many markets across the globe and
the preceding sections cover some of the key markets where
we have a local presence and warehousing. These markets
have been long established for the sales of our flooring and
there has also been significant growth in several other
markets when compared to last year. Spain was up 30%,
7
Financial Director’s Review
As is usual, we have prepared these accounts by the
consistent application of accounting standards with due
appraisal and judicious accrual for known probable liabilities
with as yet uncertain outcome at the year end. As in
previous years we, as a board, look to be prudent.
The group operates through separate legal entities in certain
areas of the world and though these are discussed in the
Chief Executive’s Review we, as a board, have concluded
that these operations are one segment for the purposes of
IFRS 8.
Some key statistics:
Group turnover at £291.9 million (2021: £266.4
million) was 9.6% higher than last year.
Profit before tax was £52.1 million (2021: £51.3
million) 1.6% higher than last year.
Selling and distribution costs were 8.6% higher than
last year. Administration expenses were 19.2% lower
than last year
Trade debtors increased to £46.7 million (2021: £39.3
million). Trade creditors increased to £61.5 million
(2021: £40.9 million).
Stock levels stand at £112.3 million (2021: £60.7
million).
Cash stands at £52.1 million (2021: £83.3 million)
even after the payment of £32.3 million in dividends,
£9.9 million in tax and £3.2 million of capital
expenditure.
Key performance indicators
The board considers growth in profit before tax and growth
in dividend key targets in line with the task of delivering
shareholder value. Control of working capital continues to
be important and the level of cash is monitored. Cash flow
has been a key performance measure.
Rather than focus on individual working capital targets or
ratios, the board are informed of all significant issues
directly by subsidiary management by means of monthly
reports on the key decisions and influences on working
capital. Our focus at subsidiary level is on stock availability
and appropriate credit given to and received from
customers and suppliers respectively. Obviously sales,
margin and profitability are monitored as well as cash,
which is the final result of our economic activities.
Appropriate summaries of these statistics are collated into
monthly group reports. These accounts contain analysis and
more importantly we require each director to undertake a
written report on their area and often these include key
indicators (obvious examples are level of absenteeism in the
factories, debtor days and margin by product line but these
are backed up with detail of the key drivers of these ratios
and the planned response).
No individual key performance indicator, or group thereof, is
regarded as more important than informed, in-depth
knowledge of the underlying businesses. Subsidiaries
present key performance indicators on debtor days, stock
turn and creditor days but the consolidation of these for the
whole group offers no extra benefit as the component of
mix can mask underlying effects. One such indicator that is
under close scrutiny is absenteeism.
In terms of non-financial KPIs brand awareness, reputation,
customer satisfaction and market share are all important
but difficult to assess. We do not believe that surveys and
market share data, to the extent that they are collated by
various trade bodies, is complete and wholly accurate.
Consequently little reliance is placed upon this data. We
subscribe to various third party reports on the flooring
industry which to an extent match and compare us to our
competitors and whilst valid snap-shots of the sector they
are limited. Customer satisfaction awards are always
welcome and we note these in our strategic report.
Principal decisions
The strategic report notes our approach to our Section 172
of the Companies Act 2006 and we have faced many
decisions in the year. We define principal decisions as those
that have a significant impact on the company and/or group
and/or our stakeholders. Principal decisions that are
currently confidential to the group are not included in the
list below. Any such decision would be included in future
report and accounts if and when confidentiality is no longer
a factor.
The potential impact of principal decisions on stakeholders is
assessed in detail by the board. Obviously a significant
number of decisions had to be made in the period of the
lockdown and principally the level of manufacturing activity.
The executive directors kept the board appraised and these
actions are described in the strategic review and in our
interim reporting. To the extent that these decisions affect
employees there is a bi-annual update on group performance.
Each of the principal decisions has an effect on employment
and hence employees as a whole so this high level update is
important to provide context for the individuals.
During the year the following were considered by the board.
Payment of dividends
The board considered shareholder expectations in setting
these dividends, along with the cash position of the
company. Cash flow projections are an important part of
8
this, particularly in the current economic environment - the
executive directors were tasked with keeping the board
appraised of the working capital position.
Defined benefit (DB) pension scheme
Further to the triennial valuation of the last year and the
adoption of the new funding arrangements the DB scheme
has remained under review. The board had discussed with
the trustees the future accrual of benefits and the trustees
made clear that an equitable payment by members would
see an increase in member contributions of around 12-15%.
The view was that the members would not consider this
appropriate and as a consequence the board tasked the
executive directors with entering consultation with the
employees over the closure to future accrual of the final
salary pension scheme.
Post Covid-19 immunisation manufacturing
The success of the initial vaccine rollout in the UK, the very
high efficacy of this vaccine and the alteration to self-
isolation rules provided the opportunity, in the early part of
the financial year, to return to more normal shift patterns
and to increase output from our UK manufacturing sites.
The board, however, needed to consider the impact of the
lesser efficacy of vaccines in the Far East, from which we
also source goods, and the ongoing lock-downs of a region
that continued to take a zero-tolerance approach to Covid-
19 cases. In order to mitigate possible supply shortages
stock levels were raised over a period of several months.
Some progress has been made on this project. The land
identified has been granted approval and environmental
considerations are being addressed and the scale of the
project agreed.
Price increases
The increase in costs over many months has been widely
reported and, we, in common with many other companies
have had to increase our prices and will undoubtedly have
to do so again. The board has been, and remains, ever
conscious of the effect of price increases on demand and it
was resolved that price increases should, to an extent, lag
cost increases to mitigate this risk. As manufacturers we
make no holding gain on stock on hand subsequent to a
price increase. Many stockists make gains on the stock they
hold, in effect increasing prices to their customers in
advance of the adverse margin effect and this can give us a
degree of knowledge of the effect of increases. The increases
in cost and availability concerns that were constant through
the Covid-19 crisis did seem to alleviate in the autumn of
2021 though the cost of international freight continued to
climb into early 2022. This situation significantly worsened
since February 2022 – when the Ukraine was invaded.
Price increases have been several during the year and
continue to the time of writing. Flooring contracts can take
several months from initial quotation to supply and it has
become ever more difficult to hold to the initial quotations.
To the extent that we have tried to work with end users on
these projects margins have eroded.
Approval of group budget
Ukraine conflict
A key process is to each year agree budgets with our trading
subsidiaries and this is presented to the board towards the
end of each trading year. Having regard to the
unprecedented situation across our markets regarding
ongoing supply chain issues re the pandemic and the
Ukrainian conflict with the energy crisis a budgetary process
this year would be neither accurate nor a useful use of time.
The Board, therefore, has assessed progress against the prior
year comparative. This year a budget (i.e. for 2022/23)
process has been followed but, again, the flow of trade is still
far from normal. In the normal course of budget preparation
manning levels and shift patterns are assessed and this
effect of working hours disseminated to the various
departmental employees. Our business, as with many
others, is still experiencing unprecedented levels of
absenteeism and huge increases in energy costs both of
which present challenges to the manufacturing process.
Warehouse expansion
In 2020 the board appraised the need for increased
warehouse capacity in the UK and plans are being finalised
for final approval. The board has agreed this in principle and
the cost of this expansion will be in excess of £15 million
(excluding stock holdings).
Since February 2022 the fragility of global supply markets
has worsened as the implications of the Ukraine conflict
became clearer.
The board resolved that we should cease to undertake sales
of flooring to Russia and given the close involvement of
Belarus to only supply the latter with healthcare related
products (after a review by the board of individual projects).
The effects on UK energy costs have been widely reported
but the implications to UK manufacture go much deeper.
Certainly the cost of our UK energy of both gas and
electricity has been significant but the effects on raw
material supplies have also been significant. The
dependency of many industries in Europe on the large
refinery and chemical plants being fed oil and gas from
Russia made it immediately apparent that the conflict
would lead to major disruptions in supply beyond the cost
of energy. The Nord Stream 1 pipe line supplying gas is
significant but more disruptive to our supply chain is the
Druzhba oil pipe line. For these reasons the board resolved
to try and increase stock levels. The resultant record level of
year end stock is a consequence.
9
Financial Director’s Review
continued
Principal business risks and
uncertainties
The ongoing pandemic continues to be an uncertainty,
though very much lower in our risk analysis given the
vaccine roll outs across the globe. The actions we take will
necessarily evolve. We have detailed procedures to minimise
risk of transmission within our business. During the year
with employees self-isolating and shielding we have
struggled to run all of our production lines at once and there
has been overtime costs of employees covering for those
absent. Many governments have offered a range of financial
support packages to help companies and these have been
taken advantage of where appropriate. There is little doubt
that whilst we offered secure employment there was among
a number of people a degree of resentment that other
people were paid to stay at home, not within the
organisation but within the economy in general.
The situation regarding the UK leaving the EU (“Brexit”) is
still an ongoing uncertainty. The availability and free flow of
raw materials has been disrupted and where the
complexities of the pandemic have superimposed
themselves on the issue of border controls. The transport
industry has not seen a normal period of activity and in the
melee includes a mix of increased paperwork, employee
shortages and excess demand. The increases in fuel and
energy costs, most particularly since February 2022, has
added to the uncertainties.
The Ukraine conflict has become a significant risk and
uncertainty and the inter-dependencies of global markets
goes far beyond energy. Just one example is the effect on
wood pulp and the manufacture of wood laminate flooring.
This is not a flooring that we manufacture or supply but it
has vastly increased in cost as a direct result of the Ukraine
invasion. Across Europe the production of urea has been
disrupted in Croatia, Spain, Italy and Germany which affects
to availability of “ad-blue” which is essential to vehicle
transport. Just one example of the risks that indirectly
impact on our group. The point is reported in the key
decisions of the year.
The board constantly assesses risks and discusses business
issues regularly. To the extent risk is insurable the board is
risk averse and the group is widely insured. A comprehensive
insurance appraisal takes place annually to mitigate
exposure to risks, such as business interruption and fire but
obviously key risks such as escalating raw material prices
and energy costs fall outside any insurable event. Inevitably
the unexpected cannot be anticipated but given the depth
of understanding of our principal business by the senior
management, and the board, risk is ameliorated but not
eliminated.
Our goals are simple and we avoid over-stretching our
capabilities. During the year the unknowns associated with
the pandemic were a key unknown and consequently a key
risk. Our plans are not limited to a twelve month set of
figures, though budgets are prepared and monitored, and we
look to benefit from decisions over a longer time frame. A
major mitigation of risk is a close understanding of our
people, their motivations, experience and limitations. In
general it is in the nature of the board to talk about and
focus on the problems of our business. This is the major way
in which risk is not merely identified but mitigated. Excess
capacity exists in our businesses and across Europe.
The risks identified beyond insured events include foreign
exchange risk, credit risk, liquidity risk and key management.
There are, additionally, key customers and key suppliers
which create dependencies. Sales and purchasing policies
are under regular review to assess these dependencies. In
the main, risk and control are measured and assessed from
a financial perspective, but this is not to the exclusion of
non-financial risks and uncertainties. It is clear that
scenarios can be envisaged where the group’s activities may
be disrupted and little could be done to mitigate the
negative effects.
In terms of credit risk certain companies have insurance in
place and where there is no insurance we often require
letters of credit or bills of exchange but fundamentally
credit control and market awareness are important. Our
cash balances, and bank facilities combined with a robust
balance sheet are buffers against liquidity risk.
respect of exchange
In
risk, the group operates
internationally and is exposed to foreign exchange risk on
both sales and purchases that are denominated in
currencies other than sterling. Those giving rise to the most
significant risk are US dollar, euro and Australian dollar. To
mitigate risk associated with exchange rate fluctuations the
group’s policy is to hedge known and forecast transactions.
This hedging is at least 25% and on occasion, albeit rarely,
more than 100% of the next year’s anticipated exposure.
IFRS 7 dictates several disclosures on risk and we have
undertaken a market risk sensitivity analysis on fluctuations
in our major currency exposure and the effects on the
financial assets and liabilities in the balance sheet (which is
included in the notes to the accounts).
Several external factors can be envisaged that would affect
operating activities. These include technical failures, labour
disputes outside our businesses, availability of raw
materials, and import or customs delays. Given the spread
of our operating activities there is a reduced risk of any
single event being catastrophic, but external factors are an
area of risk that continues to be monitored. Certain
suppliers would be difficult to replace or their products to
substitute and delays could be of several weeks duration,
10
consultation with members over the closure of the scheme to
ongoing accrual and given the large changes in interest rates, gilt
yields and the upswing in non Covid-19 related excess death we
have instigated another formal valuation of the scheme. It may
well be that the “deficit” identified at the last valuation has
significantly dwindled or may be a “surplus”.
Accounting for this defined benefit scheme is prescribed by IAS
19 and the quantum of the deficit or surplus is ever more
volatile due to the nature of using current (higher – but still
historically low) gilt yields and arguably over prudent
assumptions as driven by the actuarial profession.
The scheme comprises active members (existing employees),
deferred members (past employees not yet in retirement) and
pensioners. Under the current accounting standard for pensions
the current service costs of active members are dealt with in the
income statement with actuarial gains/losses on the accrued
benefits dealt with through the Consolidated Statement of
Comprehensive Income. This year there is a net actuarial gain of
£7.1 million against a net actuarial gain in 2021 of £12.7 million.
Gordon Oliver
Finance Director
30 September 2022
which wouldn’t be covered by our current levels of stock
holding. Given the length of service of many senior
managers, succession planning becomes a risk and/or an
uncertainty but again the open style of decision making and
collaboration mitigate the risk.
The activity and progress of our competitors is a significant
risk. Whether there is a new innovation or a gain in
competitive advantage by a new process, or the loss of
market share by any means, any effect on our volume
throughput will have an effect on profitability. The board
looks for market intelligence, and devotes significant time to
understanding the strategy of our competitors. It is clear
that the success this business has achieved over the last
twenty years leads our competitors to scour all information
we publish for data on our activities.
I would note that we have overseas subsidiaries with
significant profit and assets which are translated at average
exchange rates (in the case of profit and loss items) and at
year end rates (in the case of balance sheet items). The
effect of this is shown annually in the Consolidated
Statement of Comprehensive Income. Inevitably there is a
translational exposure on these items and since they are not
necessarily cash flows (excepting dividend payments) the
consolidated net worth of the group varies over time. We do
not hedge this translational exposure though we have in the
past hedged overseas assets with matching debt. At present
the cost and complexity in terms of arranging facilities and
complying with local taxation rules would seem to
outweigh the benefits.
The last five years of these exposures in terms of
increase/(decrease) in the value of our overseas assets are as
follows:
2022
2021
2020
2019
2018
£’000
926
(615)
336
(170)
(759)
Aside from the strategic, operational and financial risks
described there are also compliance risks relating to the
legal and regulatory requirements of the various markets in
which we operate. Directors and senior management are
involved in health and safety, duty and customs clearance,
waste management and other such issues.
Defined benefit pension scheme
In common with other long established businesses we have the
complications and uncertainty associated with having a “final
salary” pension scheme. The scheme has been closed to new
entrants since 2002 and was only offered to UK based
employees; of our UK based work force around 20% of
employees are members of this scheme. We are currently in
11
Section 172 Statement
The directors and the board as a collective consider that they acted in a way that would be most likely to promote the success
of the company for the benefit of its members as a whole (having regard to the stakeholders and matters set out in S172(1)
(a) to (f) of the Act) in the decisions taken during the year ended 30 June 2022.
The group comprises business units in various locations worldwide, all of which have engagement with their local stakeholders
and other companies within the group structure. The group’s governance delegation of authority allows decisions to be made
at business unit level up to defined limits, which allows them to take account of the needs of their local stakeholders through
their decisions implemented locally. The board routinely monitors these decisions and ultimately takes responsibility for the
interaction with all stakeholders.
In consideration of major matters discussed at board level, the likely impact on all stakeholders are carefully considered and
where possible, decisions are carefully explained and discussed with affected stakeholders before actions are implemented to
ensure they understand and have any necessary support.
The group’s key stakeholders and how we engage with them are set out below.
Stakeholder group
How do we engage with them?
How has the board considered their interests?
Shareholders
Members of the board have regular dialogue
with institutional Investors and individual
shareholders in order to develop an
understanding of their views.
The AGM is an important forum for private
shareholders to meet the board and ask any
questions they may have, directly.
The company’s website has an investors
section which gives investors direct access to
reports, press releases and business
information. There is also a contact mailbox
facility.
Customers
We interact with our customers through:
Regular visits and meetings
Industry exhibitions
Customer site tours and presentations
Business unit websites
Supplying extensive samples and
supporting literature
Delivering a high standard of technical
support
Providing enhanced digital design
services and support
The board understands that shareholders
require sustainable growth and value
creation. In recognising this, it has
implemented a policy which has resulted in
increasing dividend returns and incremental
shareholder returns over a sustained period.
Shareholder views, together with movements
in the shareholder base, are regularly
reported to and discussed by the board and
their views are considered.
Our NOMAD’s views on market sentiment
are fed back on a regular basis, and are
considered by the board where it impacts
strategy.
Our strategy of attaining sustainable growth
in profit and building goodwill in our brands
will only be achieved through an
understanding of the needs of our customers
and the markets we serve.
The board regularly considers the impact on
customers when considering strategic
decisions, for instance the major investment
in a new warehousing facility has been driven
by the need to improve customer service.
Suppliers
Employees
Communities
Engagement with suppliers and business
partners is achieved by holding regular
meetings, regular evaluation reviews and
through audits of the supplier base.
We engage with our employees through site
communications, briefings, performance
reviews, newsletters and notice boards.
Employees are also written to individually on
matters which are deemed important.
We operate from multiple sites and seek to
be a good neighbour with the local
communities. Where possible we create
opportunities to recruit and develop local
people, which helps support the local
economy and look after the environment. We
also support local charities through
fundraising and donations.
12
The board recognises that relationships with
the supplier base is important to the
reputation and long term success of the
group. There is regular dialogue between our
management team and our suppliers, where
quality, price, sustainability and health and
safety are key to the discussions. Any matters
which the board needs to be aware of are
reported back as appropriate.
The board is aware that our employees are
critical to the successful achievement of the
strategic aims. The group prides itself on
providing a friendly and safe working
environment for all employees, and given the
nature of our manufacturing process, health
and safety is taken extremely seriously. There
are a number of employees who have
achieved thirty, forty and even fifty years’
service. The group has operated a share
scheme which enabled employees to build up
personal shareholding in James Halstead plc
and participate in its expansion and success.
The board has a full understanding of the
importance of good community relations
with both internal and external stakeholders.
The impact of our operations from an
environmental perspective is recognised on a
local and global level. Capital expenditure
projects, for example, focus on improving
energy efficiency and reducing environmental
emissions.
The corporate social responsibility section of the latest Polyflor Sustainability Report outlines in further detail, the group’s
commitment to its stakeholders, including the supply chain, employees and the communities.
The principal decisions in the year are included in the Financial Director’s Review.
The strategic report was approved by the
board of directors and signed on behalf of the
board.
D N Fletcher
Secretary
30 September 2022
13
Report of the Directors
The directors are pleased to present their report, together
with the audited accounts for the year ended 30 June 2022.
Substantial interests
Results and dividends
The group results for the year and the financial position at
30 June 2022 are shown in the consolidated income
statement on page 30 and the consolidated balance sheet
on page 32.
The directors are recommending a final dividend of 5.50p
(2021: 11.00p) per share on the ordinary share capital for
payment on 16 December 2022 to those shareholders on the
register at 18 November 2022. This final dividend together
with the interim dividend of 2.25p (2021: 4.25p) per share
paid on 10 June 2022 makes a total dividend of 7.75p
(2021: 15.25p) per share for the year.
Directors
The directors who held office during the year were as
follows:
J A Wild
M Halstead
G R Oliver
S D Hall
M J Halstead
R P Whiting
Mr G R Oliver and Mr S D Hall are the directors retiring by
rotation, and offer themselves for re-election at the annual
general meeting.
The interests of the directors and their families in the share
capital of the company were as follows:
30 June 2022 30 June 2021
Beneficial As Trustee Beneficial As Trustee
J A Wild 300,600 23,950,720 150,300 11,975,360
M Halstead 26,505,604 22,250,344 13,252,567 11,126,112
G R Oliver 430,988 258,188 215,259 130,034
S D Hall 11,400 – 5,700 –
M J Halstead 1,376,234 – 688,117 –
R P Whiting – – – –
The directors consider that the board of directors include
key management for all areas of the business and that there
are no other key management which require disclosure.
Details of the directors’ options under the terms of the
executive share option scheme are set out in note 27.
As at 16 September 2022 the company had been notified of
the following interests which represent 3% or more of the
existing issued share capital:
Number %
Rulegale Nominees 73,582,520 17.7
John Halstead Settlement 70,894,436 17.0
Octopus Investment Nominees 26,250,579 6.3
Nortrust Nominees 12,555,794 3.0
Share capital
During the year new ordinary shares were issued and
allotted as fully paid to enable share options to be exercised
as follows:
11 November 2021
12 November 2021
15 November 2021
100,000
50,000
62,110
212,110
The issued share capital was increased by a bonus issue of
one ordinary share for each ordinary share held at
14 January 2022, amounting to 208,372,026 shares.
Special business at the annual general
meeting
Resolution 6 renews the directors’ authority to offer
ordinary shareholders the opportunity to take ordinary
shares in lieu of any cash dividends which may be payable
prior to the Annual General Meeting in 2023.
Resolution 7 authorises the directors to allot relevant
securities pursuant to section 551 of the Companies Act
2006 up to a maximum nominal amount of £6,945,901
representing approximately 33.33% of the total ordinary
share capital. The authority will expire at the next Annual
General Meeting of the company to be held in 2023 or six
months after the next accounting reference date of the
company (whichever is the earlier).
Except for the issue of shares to satisfy the exercise of share
options granted under the share schemes, the board has no
present intention of issuing any ordinary share capital of the
company. As at the date of this document, the company
holds no treasury shares.
Resolution 8 invites shareholders to renew the board’s
authority to issue shares for cash without first being
required to offer them pro rata to existing shareholders.
The proposed authority will terminate at the next Annual
General Meeting of the company to be held in 2023 or six
14
months after the next accounting reference date of the
company (whichever is earlier). The authority is limited to
equity securities up to an aggregate nominal amount of
5.0% of the company’s issued ordinary share capital. The
resolution also contains provisions to enable the directors to
deal with fractional entitlements and other practical
difficulties which could arise in the event of a rights issue or
similar pre-emptive offer.
Resolution 9 seeks to renew the authority of shareholders to
allow the company to purchase its own shares in respect of
up to 10% of the issued capital at prices not exceeding 5%
above the average of the middle market quotations for the
five business days preceding the purchase. The directors
undertake that the authority would only be exercised if the
directors were satisfied that a purchase would result in an
increase in expected earnings per share and was in the best
interests of the company at that time. The directors may
choose to hold shares purchased under such authority in the
form of treasury shares (subject to a maximum of 10% of
the issued ordinary share capital at any one time).
Going concern
The directors have reviewed current performance and forecasts,
combined with capital
investment and expenditure
commitments, and a range of trading scenarios. The group has
no net borrowings and owns the freeholds on many of its
premises (the most significant being four UK operating sites
and two sites in Germany).
After considering current trading and forward forecasts, the
directors have the reasonable expectation that the group has
adequate financial resources to continue in operation, including
contractual and commercial commitments, for the foreseeable
future.
As the global pandemic recedes, but with many markets now
facing high energy costs and supply chain concerns, the directors
have considered that there may be a weakening of demand for
flooring products in arriving at the conclusion above.
Fluctuations in exchange rates have been a constant factor
since sterling floated in 1971. Our hedging delays the effect of
sharp changes.
Working with our senior executives we have considered
scenarios for the purpose of the statutory audit that involve
layoffs and cessation of production in the winter months and,
whilst we do not believe they are likely, have been considered
to assess the going concern concept. The cost and availability of
international freight has continued to frustrate export sales and
as part of the going concern review we have factored in the
scenario that this will continue for several months.
Based on the above the directors are satisfied the group has
adequate resources to continue as a going concern for at least
one year from the date of approval of the financial statements.
Employment involvement
Within the UK we have both 25 year clubs and 40 year clubs
for all employees. Many employees have worked their entire
career for the group, and retaining an experienced workforce
is important to our long term success. Our workforce
retention rate is very high. Recruitment is biased to the local
area, and we have a number of graduate recruits and offer
internships to support younger people looking to develop
their employment skills. We look to pass on knowledge and
we are involved in skills training to the flooring industry,
technical knowledge to the industry in general and
involvement in the Chartered Institute of Human Resource
Management’s “Skills Ahead Mentoring Project”. We have a
floor fitting school for the industry and this is accessible to
employees allowing them to gain skills for use in their own
homes.
Promotion or opportunities in different departments are
often recruited from within the business and is preferred to
external candidates. The senior management and the
directors having, in the main, come from lower positions
within the business, including the executive directors of the
main company. Our recycling partnership presents to senior
management and staff on a regular basis to promote a better
understanding of achievements and goals to involve more of
our staff in sustainability.
We have a firm belief in equality and our main subsidiaries are
SA8000 accredited (an independent standard for decent
working environments). Also BS OHAS 18001 accredits our
occupational and safety management protocols.
All our UK employees are offered pension scheme benefits
with company contribution and the majority of UK
employees are shareholders in the company by virtue of a
long standing employee participation scheme. This is
currently being reviewed to make it even more relevant to the
group today. On the more personal level we operate a
company supported social club for employees, we have
outdoor seating, we offer bike sheds and there are shower
facilities at most sites. Also there are break out zones and
facilities to either buy or prepare food at all our sites. The
company looks favourably on providing time for employees
to undertake voluntary work.
15
Report of the Directors
continued
(some with
representatives
Across our sites there are regular consultation meetings with
employee
trade union
representatives). Our employees are an important asset and
are kept abreast of group performance at least twice a year.
In terms of decisions directly affecting employees,
communication is by line managers in the first instance, but
the directors will discuss overall matters with designated
representatives. In regard to the principal decisions of the
business the board has considered the employees as a group
and their wellbeing as a whole.
Health and safety
The health and safety of the group’s employees, customers
and members of the general public who may be affected by
the group’s activities continue to be matters of primary
concern. It is therefore the group’s policy to manage its
activities so far as to avoid causing any unnecessary or
unacceptable risk to the health and safety of all those
affected by its activities. In order to ensure that the group’s
high standards in this area are maintained, a substantial
programme of training and retraining of employees took
place throughout the year.
Research and development
We
remain totally committed to the continuing
development of our processes and our products to both
satisfy the needs of our customers and ensure that we
remain at the forefront of our industry.
Environmental policy
A policy has been issued and implemented on safeguarding
against air, water, noise and land pollution. The management
implements at every
team constantly reviews and
opportunity the most effective use of materials and energy.
A number of control measures have been introduced and
these, combined with materials storage and handling
methods, together with training, form the basis of the
environmental programme. The policy is fully endorsed by
the directors and is under constant review to ensure full
compliance with the UK Environmental Protection Act 1990.
All employees, suppliers and contractors are made aware of
the environmental policy which is also freely available to
the general public and regulatory authorities.
Emissions and energy consumption
Scope 1 and 2 consumption and carbon dioxide emission
data has been calculated in line with the 2019 UK
Government environmental reporting guidance. Emissions
Factor Database 2021 version 1 has been used, utilising the
published kWh gross calorific volume and kgCO2e
emissions factors relevant for the reporting period.
Year ended 30 June
2021
Tonnes
of CO2e
2022
Tonnes
of CO2e
9,370
9,488
5,464
5,775
15,263
Scope 1 - direct emissions
(UK facilities and vehicles)
Scope 2 - indirect emissions
(UK purchased electricity)
Total Scope 1 and Scope 2 emissions
14,834
Intensity metric – total scope
1 & 2 emissions per metric tonne
produced
0.25
0.28
Total UK energy consumption
(kWh)
74,936,963 74,343,719
Total Scope 1 and Scope 2 emissions figures for the year
ended 30 June 2021 have been restated by 1,992 Tonnes of
CO2e for comparability.
The group is committed to year on year improvements in
operational energy efficiency. A number of energy efficiency
projects continued in the year. These included the installation
of LED lighting, in conjunction with PIR sensors to ensure
that lighting is not in use when not required, and lagging for
extruder barrels. The group is mandated to comply with the
Energy Savings Opportunity Scheme (ESOS), and the
available energy efficiency improvements identified in phase
2 reporting are being reviewed and implemented where
possible. Training in energy conservation and sustainability
awareness is being considered for all staff across the business
in the coming year. All these projects and initiatives reinforce
the commitment to implementing an Energy & Environment
strategy, which reduces energy and carbon usage, and is in
line with the UK’s 2050 net zero targets.
Risk management
Information in relation to risk management and future
developments can be found in the financial director’s review
in the strategic report.
Directors’ responsibilities statement
The directors are responsible for preparing the annual report
and the financial statements in accordance with applicable
law and regulations.
16
Company law requires the directors to prepare financial
statements for each financial year. Under that law the
directors have, as required by the AIM Rules of the London
Stock Exchange, elected to prepare the group financial
statements in accordance with UK adopted international
accounting standards. The directors have elected to prepare
the parent company financial statements in accordance
with United Kingdom Generally Accepted Accounting
Practice (United Kingdom Accounting Standards and
applicable law) including Financial Reporting Standard 101
Reduced Disclosure Framework. 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 the company and of the
profit or loss of the group for that period.
The directors are also required to prepare financial
statements in accordance with the rules of the London
Stock Exchange for companies trading securities on the
Alternative Investment Market.
In preparing these financial statements the directors are
required to:
select suitable accounting policies and then apply
them consistently;
make judgements and accounting estimates that are
reasonable and prudent;
state whether the group financial statements have
been prepared in accordance with UK adopted
international accounting standards subject to any
material departures disclosed and explained in the
financial statements; and
prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the
group and company will continue in business.
The directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the company’s transactions, to disclose with reasonable
accuracy at any time the financial position of the company
and enable them to ensure that the financial statements
comply with the Companies Act 2006. They are also
responsible for safeguarding the assets of the company and
the group and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The directors are responsible for ensuring the annual report
and financial statements are made available on a website.
Financial statements are published on the company’s
website in accordance with legislation in the United
Kingdom governing the preparation and dissemination of
financial statements which may vary from legislation in
other jurisdictions.
The directors are responsible for the maintenance and
integrity of the corporate and financial information included
on the company's website. The directors’ responsibilities
also extend to the ongoing integrity of the financial
statements contained therein.
Auditor
A resolution to re-appoint BDO LLP as auditor will be
proposed at the forthcoming annual general meeting.
Directors’ statement as to the disclosure
of information to the auditor
All of the current directors have taken all the steps that they
ought to have taken to make themselves aware of any
information needed by the company’s auditor for the
purposes of their audit and to establish that the auditor is
aware of that information. The directors are not aware of any
relevant audit information of which the auditor is unaware.
Approved by the board of directors and signed on behalf of
the board.
D N Fletcher
Secretary
30 September 2022
17
Board Report on Remuneration
the aggregate price payable on the exercise of all options or
rights to subscribe for ordinary shares granted to an
individual employee under the share option plan and under
all other discretionary schemes.
Pensions
The company operates Inland Revenue Approved defined
benefit and defined contribution pension schemes. The
group chief executive and group finance director are
members of the defined benefit scheme. Pension
entitlements are calculated on basic salary only.
All members of the schemes are required to contribute a
percentage of their pensionable earnings.
Increase in
pensionable salary is restricted to the increase in the
consumer price index.
Other benefits within the schemes are death in service lump
sums, spouse’s and dependant’s pensions following death in
service of the member and ill health early retirement where
the appropriate circumstances arise.
Service agreements
The chairman and the group chief executive do not have
service agreements. The group finance director has a service
agreement which terminates within or is terminable by the
company and the executive on not more than one year’s
notice. The remuneration committee has taken the view
that notice periods of one year are reasonable and in the
interests of both the company and its executive directors
having regard to prevailing market conditions and current
practice. Mr S D Hall, Mr M J Halstead and Mr R P Whiting
each has a service contract for an initial term of two years
from the date of his appointment, which can be terminated
by either party by one month’s written notice.
S D Hall
Chairman of the Remuneration Committee
Remuneration committee
The remuneration committee comprises the non-executive
directors, with Mr S D Hall, as chairman. The committee
meets at least once a year, although usually more
frequently, to determine the remuneration packages of the
executive directors of the group.
The remuneration policy for the non-executive directors is
determined by the board as a whole by reference to market
rates. They do not participate in the group bonus scheme,
pension scheme or share option scheme. No director can
vote in regard to his own remuneration.
Remuneration policy
The remuneration policy is to provide terms of employment
such that the recruitment, motivation and retention of high
calibre personnel is achieved and maintained to the mutual
benefit of shareholders and employees. The committee is
assisted from time to time by data supplied by independent
professional remuneration consultants as to comparable
companies, although identical circumstances are rarely
found.
Basic salary and bonus payments
The directors’ salaries and fees for the year are disclosed in
note 14. Annual bonus schemes are in place which reward
the executive directors on achieving performance
objectives. Performance is determined by index-linked profit
improvements through a trend of earnings per share growth.
UK based executives are eligible members of the employee
share scheme. Performance bonuses of £500,000 to each of
the group chief executive and group finance director were
paid during the year. These related to the 2021 financial
year.
Share option schemes
The remuneration committee believes that share option
plans are an important long term incentive to executive
directors and other senior employees. They are intended to
link the exercise of the option to a sustained and significant
improvement in the underlying financial performance of the
group.
The share option plan is reviewed by the remuneration
committee and is open to executive directors and selected
employees of the group. The option price per ordinary share
will not be less than the market value on the day of grant. A
limit of four times earnings has been placed on the value of
18
Corporate Governance
Chairman’s introduction to
governance
The board
The role of the board is summarised as follows:
The board has over many years recognised its responsibility
towards good corporate governance. It is part of our
character and, I believe, contributes to our ability to deliver
long-term shareholder value. The Financial Reporting
Council and the Quoted Company Alliance have both issued
guidance on governance and having assessed these codes
we have aligned our approach to the latter. In many ways
this is a continuing process but in the following paragraphs
we outline how we effect this code and I trust our
shareholders will take the time to review our comments.
It is my belief that good governance is accountability to
shareholders as a whole over time rather than being swayed
by current short term objectives of individual holders. For
many companies some shareholders are transient and focus
short term, looking for ambitious acquisitions or risky
strategies and yet quick to exit at the first sign of problems.
Management need to be focused on the medium to long
term goal as much as current issues.
Anthony Wild
Chairman
Directors and committees
The company is controlled by the board of directors. The
board consists of a non-executive chairman, two executive
directors, a senior independent director and two non-
executive directors.
The board has two sub committees: a remuneration
committee and an audit committee.
The directors are named below along with their membership
of board committees.
Director
Role
Mr Anthony Wild
Mr Mark Halstead
Mr Gordon Oliver
Mr Steve Hall
Non-executive
Chairman
Chief
Executive
Finance
Director
Senior
Independent
Director
Mr Michael Halstead Non-executive
Mr Russell Whiting
Director
Non-executive
Director
Remuneration
Audit
Committee
Committee
X
X
X
X
X
X
X
X
To establish and maintain the group’s vision, mission
and values
Decide on the current and future strategy to ensure
the group’s longevity
To delegate to management the implementation of
policies, strategies and business plans while ensuring
the framework of internal controls is effective
Account to shareholders and stakeholders to promote
their interests and the goodwill to the group
The board comprises two executive directors and four non-
executive directors. The roles of chairman and chief
executive are separated.
Directors
Mr Anthony Wild – non-executive Chairman
Mr Wild was appointed to the board as senior independent
director in 2001 and chairman in 2017. He is a Chartered
Accountant and was senior partner in a local firm for many
years offering management consultancy services. He brings a
long and in depth knowledge of James Halstead plc, its
heritage and strategy over many years along with business
and commercial knowledge obtained in a career of business
advice. A key responsibility of the chairman is to lead the
board effectively and to oversee the adoption, delivery and
communication of the company’s corporate governance
model. The chairman as a non-executive director has
adequate separation from the day-to-day business to be able
to have an independent view. The chairman ensures that the
board receives accurate, timely and clear information and
there should be good information flows within the board and
its committees as well as between the NEDs and senior
management.
Mr Mark Halstead – Chief Executive
Mr Halstead has over 30 years’ experience in the group
holding senior management positions within Polyflor prior
to his appointment as group chief executive in 2002. Having
gained his grounding in many aspects of the group’s flooring
activities Mr Halstead focused on exports and founded our
operations in Europe. He brings unparalleled knowledge of
the group’s activities, the products and positioning in
markets and experience to allow for the assessment of
future opportunities for the group both in commercial terms
and product related. Mr Halstead is tasked with the delivery
of the business model agreed within the strategy set by the
board.
19
Corporate Governance
continued
Mr Gordon Oliver – Finance Director
Mr Russell Whiting – non-executive director
Mr Oliver is a Chartered Accountant. He trained with KPMG
and held a number of financial positions in industry prior to
joining James Halstead in 1987 as group financial controller.
He was instrumental in the disposal of non-core businesses
in the UK and overseas and became finance director of the
group
in 1999. He brings knowledge of financial
management and control, corporate governance and
business acumen to the business as well as development of
future strategy arising from a long period as a member of
the board. During his time with the company Mr Oliver’s
standing has been recognised by several awards from his
peers and the financial press. Mr Oliver is tasked with
working closely with the chief executive to progress the
business and to have regard to mitigation of risk. In addition
a key role is integrity of the financial information and
communicating to the board the financial implications of
areas of subjective judgement.
Mr Steve Hall – Senior independent director
Mr Hall was appointed to the board in 2012 as a non-
executive director. He has 21 years’ experience as a director
of corporate banking for the Royal Bank of Scotland where
he was responsible for corporate SMEs and quoted clients.
For several years he has acted as a consultant outside of
banking and is a non-executive director to a large retail
chemist chain. He brings with him this banking experience
as well as broad experience of mergers, acquisitions and
disposals and the financing thereof. One of the key
responsibilities of the SID is leading the performance
evaluation of the chairman, or the search for a new
chairman. As SID, Mr Hall is an alternative route of access
for shareholders and other directors who have a concern
that cannot be raised through the normal channels of the
chair or the executive directors. Mr Hall is chairman of the
remuneration and the audit committees.
Mr Michael Halstead – non-executive director
Mr Halstead was appointed to the board in 2017. He has
many years’ experience in the advertising industry having
been an account director for Saatchi and Saatchi and more
recently running his own company HH&S Group Limited.
He brings general business acumen to the board along with
specifics relating to marketing and public relations arising
from his background. Mr Halstead provides oversight and
scrutiny of the performance of the executive directors,
whilst both constructively challenging and inspiring them,
thereby ensuring the business develops, communicates and
executes the agreed strategy and operates with reference to
the risk management framework. Mr Halstead is in the 4th
generation after the founder and has never worked within
the business but is passionate to preserve the principles of
the company and to contribute to its continued success.
Mr Whiting was appointed to the board in 2017. He is a
local businessman and is director of a company involved in
leasing of assets, Associated Credits Holdings Ltd. As well as
general business acumen he brings specific understanding of
business and asset financing to a broad range of commercial
enterprises. He has known the group for a number of years
through his business. Mr Whiting possesses the critical skills
that are relevant to modern companies, which includes both
technical experience and the ability to positively challenge
and to listen in equal measure.
Attendance at the six board meetings during the year was as
follows:
Possible Actual
J A Wild 6 6
M Halstead 6 6
G R Oliver 6 6
S D Hall 6 5
M J Halstead 6 6
R P Whiting 6 6
Senior management team
Mr David Drillingcourt – Corporate development director
Mr Drillingcourt is a Chartered Accountant and trained with
KPMG before joining the company in 1996 as group
accountant. He served as finance director at two of the
company’s subsidiaries, Phoenix Distribution (NW) Limited
(1999-2005) and Polyflor Limited (2005 – 2013). He served
as company secretary (2013 – 2021). He was appointed
corporate development director in 2019. Working closely
with the board and subsidiary directors, the role is designed
to help support the future growth of the business across the
globe.
Internal control
The board has ultimate responsibility for the system of
internal control operating throughout the group and for
reviewing its effectiveness. Internal control systems in any
group are designed to meet the particular needs of that
group and the risks to which it is exposed. No system of
internal control can provide absolute assurance against
material misstatement or loss. The group’s system is
designed to manage rather than eliminate the risk of failure
in order to achieve business objectives and to provide the
board with reasonable assurance that potential problems
will normally be prevented or will be detected in a manner
which will enable appropriate action to be taken.
20
The key procedures which the directors have established
with a view to providing effective internal control are as
follows:
the audit committee keeps under review the
effectiveness of the system of internal control and
reports its conclusions to the full board;
the group directors are responsible for establishing,
maintaining and reviewing the group’s system of
internal control and meet regularly to consider group
financial performance, business development and
management issues, and to review these against
predetermined objectives;
the group board establishes corporate strategy and
business objectives. Management of subsidiary
companies integrate these objectives into their
business strategies for presentation to the group
board with supporting financial objectives;
subsidiary company budgets, containing financial and
operating targets, capital expenditure proposals and
performance/profitability indicators, are presented to
and reviewed by the group executive directors. The
consolidated group budget is approved by the group
board;
there is an ongoing process for identifying, evaluating
and managing the significant risks faced by the group.
These risks are appraised and evaluated by
responsible executives and endorsed by subsidiary
and group management. This process has been in
place throughout the year and up to the date of
approval of the annual accounts;
as part of the regular monitoring and review, the
group executive directors hold regular meetings with
the management of the subsidiary companies at
which reports covering such areas as forecasts,
business development, strategic planning, risk
exposure and performance against budget, are
presented and discussed. These are then reported to
the group board, on a quarterly basis;
the group board reviews and considers any major
problem which may have occurred and assesses how
the risks have changed in the period under review;
there is a group-wide policy governing appraisal and
approval of capital expenditure and asset disposals;
to underpin the effectiveness of controls, it is the
group’s policy to recruit management and staff of
high calibre, integrity and appropriate disciplines.
High standards of integrity, business ethics and
compliance with laws, regulations and internal
policies are demanded from staff at all levels;
the board also conducts an assessment of the
effectiveness of the
internal control system.
This assessment consists of a review of all the
significant areas of internal control, including risk
assessment, the control environment, control
activities, information and communication, and
monitoring.
The Quoted Company Alliance Code
(“QCA code”)
The directors recognise the importance of good corporate
governance and have chosen to apply the QCA code as their
framework to do so. The QCA code was developed by the
Quoted Company Alliance in consultation with a number of
institutional small company investors as an alternative code
applicable to AIM companies. The QCA code was published
in April 2018.
The QCA code sets out ten principles which seek to ensure
that the overall framework for corporate governance is
robust. The directors believe that this framework is
appropriate to the size and operations of the business and
each of the principles is commented on below. Many of the
disclosures relevant to the code are already made in our
annual report and accounts.
The chairman has the responsibility for corporate
governance and has taken a lead on this matter. The
executive team are directed with day to day management
and are accountable to the rest of the board. The chairman
expects and demands open discussion of issues facing the
business and in the application of this code has sought input
from the auditors, the company’s advisors and a review by
the company lawyer. The board is tasked with continuing
the success of the business over time and through
successive generations of management and the importance
of corporate governance is to oversee the division of
ownership and stewardship. The executive directors have the
day to day responsibility of stewardship and the chairman
and non-executives monitor and evaluate this on behalf of
the owners.
James Halstead plc has been listed on the London stock
exchange for over 70 years and continues to look for growth
in sales and profit to continue its strong record of reward to
shareholders in the form of dividend. Whilst this is a primary
role, the board is proud of its reputation within its industry
and the financial markets and corporate control is central to
the ethos.
21
Corporate Governance
continued
The disclosures below were last reviewed and approved by
the board on 30 September 2022.
QCA Principles and James Halstead
plc’s approach
1. Establish a strategy and business model which promote
long-term value for shareholders
James Halstead plc’s strategy is explained fully within our
Strategic Report section in our Report and Accounts each
financial year.
Our strategy is focussed on stable profitable growth from
building the goodwill in our brands and products leading to
increasing dividends over time.
Key risks and mitigating factors to our business are also
detailed annually in our Report and Accounts.
2. Seek to understand and meet shareholder needs and
expectations
The board has a track record of increasing dividends over
many years. Where the business has generated funds in
excess of its medium-term requirements and no specific
investment requirements exist the board has also
encouraged the payment of special dividends over the years.
Members of the board talk regularly to both institutional
and private investors and the financial press to ensure that
company’s strategy and objectives are communicated. The
group has a large number of shareholders and regular broker
updates are published.
The company regularly hosts institution and broker site
visits to update on progress and the executive directors are
in ongoing contact with the nominated advisor who
communicates more closely with the market.
Shareholders can contact the company secretary with
questions and may be referred to the directors.
In addition, the AGM acts as a forum for all shareholders to
meet with the board and raise any questions they may have.
3. Take into account wider stakeholder and social
responsibilities and their implications for long-term
success.
The board recognises that the group has responsibilities to
many stakeholders other than its shareholders. This includes
employees, customers, suppliers and the wider societies in
which we operate.
In terms of communications with stakeholders this is done
in ways appropriate to the stakeholder and may take the
form of formal announcements, individual meetings (for
example appraisals with employees) and negotiations with
other stakeholders.
The environmental impact of our manufacturing and our
output is of significant importance to our medium term
prospects not only to demonstrate our commitment to the
community at large but also to customers who increasingly,
and rightly, look for suppliers with strong ethical values.
As a member of the communities in which we operate the
board takes seriously the impact the business has, positively
in terms of being an employer and seeking continuous
impact on the
improvement with respect to the
environment and communities. This is illustrated by our
annual “Sustainability Report” copies of which are available
on www.polyflor.com which outlines the impact of our
manufacturing operations on the wider environment and
local
improvements over time. Feedback from the
community is received directly to the head office. This
report has been published for nearly two decades and is now
an annual report.
We understand continuous development of our products
also contributes to our responsibilities as well as the success
of the business. This is illustrated, for example, by
development of “dementia friendly” flooring in recent years.
The operating businesses encourage feedback from
customers through their relationship managers in the
business and customer service teams.
4. Embed effective risk management, considering both
opportunities and threats, throughout the organisation.
Risk management is reported annually in our Report and
Accounts along with how those risks are mitigated and how
they change over time.
The board meets six times a year during which business and
other risks are assessed. Key subsidiaries have their own
management boards which meet regularly and assess the
risks relevant to that specific business and relevant
responses. These are communicated to the main board
either by direct representation or via group management
structures that are in place. There are also formal and
informal communication routes that allow for risks to be
communicated to board members in a timely manner from
all operational entities.
5. Maintain the board as a well-functioning, balanced
team led by the chair.
Anthony Wild, the non-executive chairman is responsible for
the running of the board and Mark Halstead as chief
executive has responsibility for implementation of the
board’s direction.
22
A monthly report is provided to the board of the financial and
operational performance of the group. Information is
provided in advance of meetings.
The board is responsible for all strategic decisions and the
overall governance and culture of the group.
All the directors have access to the services and advice of the
company secretary and are able to take independent
professional advice to enable them to do so. This may be done
at the group’s expense.
The board has a majority of non-executive directors and
consider that they bring independent thought and judgement
to bear as well as business experience out-with the group.
The board has sub committees with specific remits,
specifically remuneration and audit committees and detail of
the number of meetings and attendance by directors is noted
in the Annual Report.
6. Ensure that between them the directors have the
necessary up-to-date experience, skills and capabilities
The board evaluates consistently those skills that are
required and whether they are adequately provided for. In
doing so and where relevant it will consider guidance available
on appointment and training of board members. The Company
Secretary has the responsibility to make the board aware of
legal changes and will advise on the company’s approach. For
example the recent GDPR requirements and previously the
Market Abuse Regulations (MAR).
The company secretary supports the chairman in addressing
the training and development needs of the directors. In the
case of new directors there is an induction process to ensure
they become aware of the operations of the group.
The directors are aware of their individual responsibility to
undertake appropriate continuing development.
7. Evaluate board performance based on clear and relevant
objectives seeing continuous improvement.
The board will take account of the Financial Reporting
Council’s Guidance on Board Effectiveness as it evaluates on
a regular basis its performance. The remuneration committee
meets formally and is tasked with not only the remuneration
of the executive directors but also evaluation of performance.
To this end the board is circulated with press comment and
market feedback on the business. Market share data and peer
group analysis is available.
In terms of the financial performance the auditors meet the
audit committee (comprising the non-executives) bi-
annually and beyond the audit report do comment on the
systems, procedures and efficacy of the management. The
nominated advisor has access to the Chairman and meets
the non-executives annually.
A rigorous recruitment process is undertaken for new
directors prior to their proposal and election. In terms of re-
election their performance is reconsidered prior to them
being proposed to ensure they remain effective in their role
and that they retain their independence.
Re-election is considered by the shareholders at the AGM at
which shareholders have the opportunity as a body to
approve or otherwise board membership. Succession
planning for the board and as importantly the key
executives around the world who manage our businesses is
an ongoing topic of discussion.
8. Promote a corporate culture that is based on ethical
values and behaviours.
The board expects the highest ethical standards of its
members and management across the group.
The group has documented procedures with respect to its
responsibilities regarding ethical behaviour, specifically
bribery and corrupt practices and modern slavery and these
are applicable across its operations including supply and
customer chains.
The board also takes seriously its responsibilities towards
sustainability of its operations and the impact of our
operations on the environment. This is documented and
reported on annually in Polyflor’s Sustainability Report.
As an employer and member of many communities
throughout the world, the board consider that strong ethical
values to be a good member of these communities is a mind-
set not one underpinned by rules and procedures. Ensuring,
via recruitment processes and cultural values that this
cascades through the business is critical to ensuring the
group is a “good member of the community”. All directors of
the group’s companies are expected to comply and are given
a manual on procedures and expectations. This covers
authority levels and gives guidance on appropriate behaviour.
Ultimately service contracts underpin this by indicating
behaviour that can be deemed a breach of contract and the
directors are clear about their statutory duties as formally
set out in sections 171 – 177 of the Companies Act 2006.
23
Corporate Governance
continued
9. Maintain governance structures and processes that are
fit for purpose and support good decision making by the
board
10. Communicate how the company is governed and is
performing by maintaining a dialogue with shareholders
and other relevant stakeholders
The AGM is a key forum for communications with any
shareholders who wish to attend, and the directors are
available here to listen to views expressed both formally and
informally. This combined with the normal cycle of
announcements is the key method of communication. The
outcome of resolutions put to the AGM are published and
are available on the company website.
In terms of publication of results, the company uses the
Stock Exchange regulatory news service (RNS) to advise the
market (i.e. shareholders and others) of performance and
significant matters. As a group we do not find social media
(Facebook, twitter etc.) an appropriate medium for
dissemination of news due to the “sound-bite” nature of the
medium. Brokers are updated and circulate notes regularly.
The group has, where appropriate, communications with
major institutional and private shareholders and encourages
dialogue.
Corporate governance disclosures are assessed at least
annually, including whether the structures and processes are
fit for purpose.
The board retains ultimate accountability for maintaining
good governance. The executive directors are responsible for
the day-to-day operational management of the group and
the non-executive directors are responsible for bringing
their independent and objective judgement to board
discussions and decisions. The roles of chairman and chief
executive are split in accordance with best practice. The
board are responsible for the implementation of strategy,
the achievement of performance and ensuring the
framework of internal controls is effective. The board has
delegated specific responsibilities to the audit and
remuneration committees.
The audit committee assists the board by ensuring that the
financial performance of the group is properly reported. It
oversees and reviews the internal control processes, its
relationship with external auditors and the process for
ensuring compliance with laws, regulations and corporate
governance.
The remuneration committee is responsible for establishing
a formal and transparent procedure for developing policy on
remuneration and to set the remuneration packages of
individual directors, including, where appropriate, bonuses,
incentive payments and share options.
Due the nature and size of the company, the directors have
determined that a nomination committee is not necessary
and that issues concerning the nomination of directors will
be dealt with by the board directly.
24
Independent Auditor’s Report to the Members of
James Halstead plc
Opinion on the financial statements
In our opinion:
Independence
the financial statements give a true and fair view of
the state of the group’s and of the parent company’s
affairs as at 30 June 2022 and of the group’s profit for
the year then ended;
the group financial statements have been properly
prepared
in accordance with UK adopted
international accounting standards;
the parent company financial statements have been
in accordance with United
properly prepared
Kingdom Generally Accepted Accounting Practice; and
the financial statements have been prepared in
accordance with the requirements of the Companies
Act 2006.
We have audited the financial statements of James
Halstead plc (the ‘parent company’) and its subsidiaries (the
‘group’) for the year ended 30 June 2022 which comprise
the Consolidated Income Statement, the Consolidated
Statement of Comprehensive Income, the Consolidated and
the Parent Company Balance Sheets, the Consolidated and
Parent Company Statement of Changes in Equity, the
Consolidated Cash Flow Statement and notes to the
consolidated and Parent Company financial statements,
including a summary of significant accounting policies.
The financial reporting framework that has been applied in
the preparation of the group financial statements is
applicable law and UK adopted international accounting
standards. The financial reporting framework that has been
applied in the preparation of the parent company financial
statements
law and United Kingdom
including Financial Reporting
Accounting Standards,
Standard 101 Reduced Disclosure Framework (United
Kingdom Generally Accepted Accounting Practice).
is applicable
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further
described in the Auditor’s responsibilities for the audit of the
financial statements section of our report. We believe that
the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
We remain independent of the group and the parent
company in accordance with the ethical requirements that
are relevant to our audit of the financial statements in the
UK, including the FRC’s Ethical Standard as applied to listed
entities, and we have
fulfilled our other ethical
responsibilities in accordance with these requirements.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that
the directors’ use of the going concern basis of accounting
in the preparation of the financial statements is appropriate.
Our evaluation of the directors’ assessment of the group
and the parent company’s ability to continue to adopt the
going concern basis of accounting included:
Examining the directors’ business plan covering the
period to October 2023. We examined the cash flow
forecasts for key judgements, verifying to source data
as appropriate, as well as considering downside
sensitivities to these;
Testing their mechanical accuracy and assessing
historical forecast accuracy;
Challenge of the directors’ stress test scenarios
including levers available to the directors to mitigate
the impacts;
Challenge of the directors on the key assumptions
included in the scenarios and confirmed the directors’
mitigating actions are within their control; and
Assessing the adequacy of the disclosures within the
financial statements relating to the directors’
assessment of the going concern basis of preparation.
Based on the work we have performed, we have not
identified any material uncertainties relating to events or
conditions that, individually or collectively, may cast
significant doubt on the group and the parent company’s
ability to continue as a going concern for a period of at least
twelve months from when the financial statements are
authorised for issue.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
25
Independent Auditor’s Report to the Members of
James Halstead plc continued
Overview
Coverage
99% (2021: 97%) of Group profit before tax
90% (2021: 90%) of Group revenue
95% (2021: 96%) of Group total assets
Key audit matters
Inventory provisioning
Pension scheme assumptions
Materiality
2022
(cid:0)(cid:0)
(cid:0)(cid:0)
2021
(cid:0)(cid:0)
(cid:0)(cid:0)
Group financial statements as a whole: £2.60m (2021:
£2.56m) based on 5% of profit before tax (2021: 5% of
profit before tax).
An overview of the scope of our audit
Our group audit was scoped by obtaining an understanding
of the group and its environment, including the group’s
system of internal control, and assessing the risks of
material misstatement in the financial statements. We also
addressed the risk of management override of internal
controls, including assessing whether there was evidence of
bias by the directors that may have represented a risk of
material misstatement.
Our group audit scope focused on the group’s principal
operating locations being the United Kingdom, Germany
and Australia. The operations in the United Kingdom, which
were deemed to be significant components, were subject to
a full scope audit given the statutory audit requirements
whilst the significant components in Germany and Australia
were also subject to a full scope audit to component
materiality. The German component was audited by a non-
BDO member firm. The Australian component was audited
by a BDO member firm. The remaining components of the
these
group were considered non-significant and
components were principally subject to analytical review
procedures by the group engagement team.
Our involvement with component auditors
For the work performed by component auditors, we
determined the level of involvement needed in order to be
able to conclude whether sufficient appropriate audit
evidence has been obtained as a basis for our opinion on the
group financial statements as a whole. Our involvement
with component auditors included the following:
The German operations form a significant part of group
turnover and profitability. As part of our audit strategy, the
Responsible Individual and senior members of the group
audit team were involved during the planning and risk
assessment process of the German component in addition
to during the completion of detailed audit procedures. We
attended key meetings with component management and
auditors, and reviewed component auditor work papers.
The Australian operations form a further significant part of
group turnover and profits. Again the Responsible Individual
and senior members of the group audit team were involved
at all stages of the audit process, directing the planning and
risk assessment work performed through calls with the
component auditors and local management. Reviews of the
component auditor working papers were also completed.
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the
financial statements of the current period and include the
most significant assessed risks of material misstatement
(whether or not due to fraud) that we identified, including
those which had the greatest effect on: the overall audit
strategy, the allocation of resources in the audit, and
directing the efforts of the engagement team. These matters
were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.
Key audit matter – Inventory provisioning
As described in Note 2 (accounting policies) and Note 19
(inventories), the group carries inventory at the lower of
cost and net realisable value.
Provision is made against slow moving, obsolete and
damaged inventories. As at 30 June 2022, the group held
inventories of £112.3m (2021: £60.7m).
judgement
This area represented a key audit matter as significant
management
is required to assess the
appropriate level of provisioning for items which may be
sold below cost or written off as a result of a reduction in
consumer demand particularly in light of changing
consumer tastes and new products being developed. Such
judgements include management’s expectations for future
sales.
26
How the scope of our audit addressed the key
audit matter
We obtained evidence concerning management’s
assumptions applied in calculating the value of inventory
provisions by:
Challenging the group’s inventory provisioning policy
with specific consideration given to slow moving or
obsolete stock lines. This involved a review of
production and sales records for a sample of products
to ascertain when they were last made or sold and
whether they had been appropriately provided for;
assessing the appropriateness of the percentages
applied within the provision by reviewing historic
sales and the ageing of stock; and
testing of a sample of inventory to confirm it is held
at the lower of cost and net realisable value, through
comparison to invoices for cost and sales prices.
We also audited the basis of stock provisioning applied by
all group entities and considered whether these were being
applied consistently and reflected the nature of the stock
held in each location.
Key observation: Our work did not highlight evidence that
the method of inventory provision was inappropriate.
Key audit matter – Pension scheme
assumptions
As described in Note 2 (accounting policies) and Note 26
(retirement benefit obligations), the group has a defined
benefit pension plan in the UK.
At 30 June 2022, the group recorded a net retirement
benefit of £6.1m (2021: £4.4m obligation), comprising
scheme assets of £69.2m (2021: £77.3m) and scheme
liabilities of £63.1m (2021: £81.6m).
The pension valuation is dependent on market conditions
and key assumptions made by management, in particular
relating to investment markets, discount rate, inflation
expectations and life expectancy assumptions.
This area and the related disclosures represented a key audit
matter given that the setting of these assumptions is
complex and
requires the exercise of significant
management judgement with the support of third party
actuaries.
In testing the pension valuation, with the help of external
pension actuarial experts, we reviewed the key actuarial
assumptions used, both financial and demographic, and
considered the appropriateness of the methodology utilised
to derive these assumptions.
We benchmarked the scheme assumptions against other
schemes of a similar size and profile. Specifically, we
challenged the discount rate, inflation and mortality
assumptions applied in the calculation by using pension
experts to benchmark the assumptions applied against
comparable
the
appropriateness of the assumptions in the context of the
group’s own position. We have also performed sensitivity
analysis on the assumptions determined by the directors.
third party data and assessed
We have tested the accuracy of the scheme asset
statements by reference to service organisation control
reports to gain assurance over the robustness of the
provider’s internal controls. Further, we have sample tested
assets to third party sources in order to confirm ownership
and valuation
Furthermore, we have assessed the disclosure of the net
pension asset and the related assumptions and sensitivities
in the financial statements against the relevant accounting
framework.
Key observation: We have not identified any evidence to
suggest that the methodology and assumptions applied in
relation to determining the pension valuation are not within
an acceptable range. Furthermore, the disclosures made are
in accordance with the relevant accounting framework.
Our application of materiality
We apply the concept of materiality both in planning and
performing our audit, and in evaluating the effect of
misstatements. We consider materiality to be the
magnitude by which misstatements, including omissions,
could influence the economic decisions of reasonable users
that are taken on the basis of the financial statements.
In order to reduce to an appropriately low level the
probability that any misstatements exceed materiality, we
use a lower materiality level, performance materiality, to
determine the extent of testing needed. Importantly,
misstatements below these levels will not necessarily be
evaluated as immaterial as we also take account of the
nature of identified misstatements, and the particular
circumstances of their occurrence, when evaluating their
effect on the financial statements as a whole.
27
Independent Auditor’s Report to the Members of
James Halstead plc continued
Based on our professional judgement, we determined
materiality for the financial statements as a whole and
performance materiality as follows:
Group financial statements
2022
£2.60m
Materiality
Basis for determining
materiality
Performance materiality £1.69m
5% of profit before tax
2021
£2.56m
5% of profit before tax
£1.67m
Parent company financial statements
Materiality
Basis for determining
materiality
2022
£1.61m
5% of profit before tax.
.
Performance materiality £1.05m
2021
£1.66m
5% of profit before tax.
For the purposes of
the group audit, the
amount above was
restricted to
component materiality.
£1.08m
Rationale for the benchmark applied – Pre-tax profit is
determined to be a stable basis of assessing business
performance and is considered to be the most significant
determinant of performance used by shareholders.
Basis for determining performance materiality – 65% of the
above materiality level. This is considered the appropriate
basis given the multiple significant components across three
geographic regions (United Kingdom, Germany and
Australia), the level of misstatements in the past and our
overall risk assessment.
Other information
The directors are responsible for the other information. The
other information comprises the information included in
the Report and Accounts 2022 other than the financial
statements and our auditor’s report thereon. Our opinion
on the financial statements does not cover the other
information and, except to the extent otherwise explicitly
stated in our report, we do not express any form of
assurance conclusion thereon. Our responsibility is to read
the other information and, in doing so, consider whether the
other information is materially inconsistent with the
financial statements or our knowledge obtained in the
course of the audit, or otherwise appears to be materially
misstated. If we identify such material inconsistencies or
apparent material misstatements, we are required to
determine whether this gives rise to a material
misstatement in the financial statements themselves. If,
based on the work we have performed, we conclude that
there is a material misstatement of this other information,
we are required to report that fact.
We have nothing to report in this regard.
Other Companies Act 2006 reporting
Based on the responsibilities described below and our work
performed during the course of the audit, we are required by
the Companies Act 2006 and ISAs (UK) to report on certain
opinions and matters as described below.
Component materiality
Strategic report and directors’ report
We set materiality for each significant component of the
group based on a percentage of between 20% and 70% of
group materiality dependent on the size and our assessment
of the risk of material misstatement of that component.
Component materiality ranged from £0.52m to £1.82m. In
the audit of each component, we further applied
performance materiality levels of 65% of the component
materiality to our testing to ensure that the risk of errors
exceeding component materiality was appropriately
mitigated.
Reporting threshold
We agreed with the Audit Committee that we would report
to them all individual audit differences in excess of £52,000
(2021: £51,260). We also agreed to report differences below
this threshold that, in our view, warranted reporting on
qualitative grounds.
In our opinion, based on the work undertaken in the course
of the audit:
the information given in the Strategic report and the
Directors’ report for the financial year for which the
financial statements are prepared is consistent with
the financial statements; and
the Strategic report and the Directors’ report have
been prepared in accordance with applicable legal
requirements.
In the light of the knowledge and understanding of the
group and parent company and its environment obtained in
the course of the audit, we have not identified material
misstatements in the Strategic report or the Directors’
report.
28
Matters on which we are required to report by
exception
Extent to which the audit was capable of detecting
irregularities, including fraud
We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
adequate accounting records have not been kept by
the parent company, or returns adequate for our
audit have not been received from branches not
visited by us; or
the parent company financial statements are not in
agreement with the accounting records and returns;
or
certain disclosures of directors’ remuneration
specified by law are not made; or
we have not received all the information and
explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors’ responsibilities
statement, the directors are responsible for the preparation
of the financial statements and for being satisfied that they
give a true and fair view, and for such internal control as the
directors determine is necessary to enable the preparation
of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are
responsible for assessing the group’s and the parent
company’s ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors
either intend to liquidate the group or the parent company
or to cease operations, or have no realistic alternative but to
do so.
Auditor’s responsibilities for the audit
of the financial statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and
to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not
a guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when
it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial
statements.
Irregularities, including fraud, are instances of non-
laws and regulations. We design
compliance with
procedures in line with our responsibilities, outlined above,
to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are
capable of detecting irregularities, including fraud is detailed
below.
Based on our understanding and accumulated knowledge of
the group and the sector in which it operates we considered
the risk of acts by the group which were contrary to
applicable laws and regulations, including fraud and whether
such actions or non-compliance might have a material
effect on the financial statements. These included but were
not limited to those that relate to the form and content of
the financial statements, such as the group accounting
policies, international accounting standards, the UK
Companies Act 2006 and the QCA Code; those that relate to
the payment of employees; and industry related such as
compliance with health and safety requirements.
We assessed the susceptibility of the financial statements
to material misstatement including fraud and evaluated
management’s incentives and opportunities for fraudulent
manipulation of the financial statements (including the risk
of override of controls) and determined that the principal
risks were related to posting inappropriate journal entries,
revenue recognition and management bias in accounting
estimates.
Our audit procedures included, but were not limited to:
Obtaining an understanding of
the control
environment in monitoring compliance with laws and
regulations;
Enquiring of management concerning potential
litigations and claims;
Performing analytical procedures to identify any
unusual or unexpected relationships that may
indicate risks of material misstatement due to fraud;
Reading minutes of meetings of those charged with
governance;
in
their
Challenging assumptions and judgements made by
management
significant accounting
estimates, in particular in relation to the group’s
defined benefit pension scheme liabilities, accruals,
stock provisions (as set out in the key audit matters
section above) and forecasts used within impairment
models utilised to assess goodwill impairment;
29
Independent Auditor’s Report to the Members of
James Halstead plc continued
A critical assessment of the consolidation and
consideration of manual or late journals posted at
consolidation level;
Identification and testing of journal entries, in
particular any journal entries posted with unusual
account combinations or including specific keywords
using data analytics; and
Agreement of the financial statement disclosures to
underlying supporting documentation.
We communicated relevant identified laws and regulations
and potential fraud risks to all engagement team members,
including the component auditors, and remained alert to
any indications of fraud or non-compliance with laws and
regulations throughout the audit. Our audit procedures
were designed to respond to risks of material misstatement
in the financial statements, recognising that the risk of not
detecting a material misstatement due to fraud is higher
than the risk of not detecting one resulting from error, as
fraud may involve deliberate concealment by, for example,
forgery, misrepresentations or through collusion. There are
inherent limitations in the audit procedures performed and
the further removed non-compliance with laws and
regulations is from the events and transactions reflected in
the financial statements, the less likely we are to become
aware of it.
Financial
A further description of our responsibilities is available on
the
at:
www.frc.org.uk/auditorsresponsibilities. This description
forms part of our auditor’s report.
Reporting Council’s website
Use of our report
This report is made solely to the parent company’s
members, as a body, in accordance with Chapter 3 of Part 16
of the Companies Act 2006. Our audit work has been
undertaken so that we might state to the parent company’s
members those matters we are required to state to them in
an auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume
responsibility to anyone other than the parent company and
the parent company’s members as a body, for our audit
work, for this report, or for the opinions we have formed.
Stuart Wood (Senior Statutory Auditor)
For and on behalf of BDO LLP, Statutory Auditor
Manchester
United Kingdom
30 September 2022
BDO LLP is a limited liability partnership registered in
England and Wales (with registered number OC305127).
30
Consolidated Income Statement
for the year ended 30 June 2022
Note 2022 2021
£’000 £’000
Revenue 5 291,860 266,362
Cost of sales (178,355) (154,722)
Gross profit 113,505 111,640
Selling and distribution costs (50,316) (46,335)
Administration expenses (10,931) (13,532)
Operating profit 52,258 51,773
Finance income 9 42 48
Finance cost 10 (237) (553)
Profit before income tax 7 52,063 51,268
Income tax expense 11 (11,735) (11,407)
Profit for the year attributable to equity shareholders 40,328 39,861
Earnings per ordinary share of 5p
– basic 12 9.7p 9.6p
– diluted 12 9.7p 9.6p
All amounts relate to continuing operations.
Details of dividends paid and proposed are given in note 13.
The earnings per ordinary share of 5p for the year ended 30 June 2021 have been restated for the effect of the one-for-one bonus
issue on 14 January 2022
31
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2022
Note 2022 2021
£’000 £’000
Profit for the year 40,328 39,861
Other comprehensive income net of tax:
Items that will not be reclassified subsequently
to the income statement:
Remeasurement of the net defined benefit liability 26 7,090 12,708
7,090 12,708
Items that could be reclassified subsequently
to the income statement if specific conditions are met:
Foreign currency translation differences 926 (615)
Fair value movements on hedging instruments (111) 1,089
815 474
Other comprehensive income for the year net of tax 7,905 13,182
Total comprehensive income for the year 48,233 53,043
Attributable to:
Equity holders of the company 48,233 53,043
Items in the statement above are disclosed net of tax. The income tax relating to each component of other comprehensive income
is disclosed in note 11.
32
Consolidated Balance Sheet
as at 30 June 2022
Note 2022 2021
£’000 £’000
Non-current assets
Property, plant and equipment 15 36,671 37,242
Right of use assets 16 5,634 6,015
Intangible assets 17 3,232 3,232
Retirement benefit obligations 26 6,144 –
Deferred tax assets 18 234 254
51,915 46,743
Current assets
Inventories 19 112,279 60,684
Trade and other receivables 20 51,171 42,949
Derivative financial instruments 29 2,166 848
Cash and cash equivalents 21 52,144 83,261
217,760 187,742
Total assets 269,675 234,485
Current liabilities
Trade and other payables 22 84,507 65,551
Derivative financial instruments 29 517 92
Current income tax liabilities 2,097 1,160
Lease liabilities 23 2,166 2,948
89,287 69,751
Non-current liabilities
Retirement benefit obligations 26 – 4,357
Other payables 22 453 447
Deferred tax liabilities 18 2,929 –
Lease liabilities 23 3,548 3,236
Preference shares 24 200 200
7,130 8,240
Total liabilities 96,417 77,991
Net assets 173,258 156,494
Equity
Equity share capital 27 20,837 10,408
Equity share capital (B shares) 27 160 160
20,997 10,568
Share premium account – 4,122
Capital redemption reserve – 1,174
Currency translation reserve 5,912 4,986
Hedging reserve 941 1,052
Retained earnings 145,408 134,592
Total equity attributable to shareholders of the parent 173,258 156,494
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 30 September 2022.
M Halstead G R Oliver
Director Director
James Halstead plc Registration Number 140269
33
Consolidated Statement of Changes in Equity
for the year ended 30 June 2022
Capital Currency
Share Share redemption translation Hedging Retained Total
capital premium reserve reserve reserve earnings equity
£'000 £'000 £'000 £'000 £’000 £’000 £'000
Balance at 30 June 2020 10,567 4,072 1,174 5,601 (37) 116,098 137,475
Profit for the year – – – – – 39,861 39,861
Remeasurement of the net defined
benefit liability – – – – – 12,708 12,708
Foreign currency translation
differences – – – (615) – – (615)
Fair value movements on
hedging instruments – – – – 1,089 – 1,089
Total comprehensive income for
the year – – – (615) 1,089 52,569 53,043
Transactions with equity shareholders
Dividends – – – – – (34,083) (34,083)
Issue of share capital 1 50 – – – – 51
Share based payments – – – – – 8 8
Balance at 30 June 2021 10,568 4,122 1,174 4,986 1,052 134,592 156,494
Profit for the year – – – – – 40,328 40,328
Remeasurement of the net defined
benefit liability – – – – – 7,090 7,090
Foreign currency translation
differences – – – 926 – – 926
Fair value movements on
hedging instruments – – – – (111) – (111)
Total comprehensive income for
the year – – – 926 (111) 47,418 48,233
Transactions with equity shareholders
Dividends – – – – – (32,298) (32,298)
Issue of share capital 11 812 – – – – 823
Bonus issue of share capital 10,418 (4,934) (1,174) – – (4,310) –
Share based payments – – – – – 6 6
Balance at 30 June 2022 20,997 – – 5,912 941 145,408 173,258
34
Consolidated Cash Flow Statement
for the year ended 30 June 2022
2022 2021
£’000 £’000
Profit for the year attributable to equity shareholders 40,328 39,861
Income tax expense 11,735 11,407
Profit before income tax 52,063 51,268
Finance cost 237 553
Finance income (42) (48)
Operating profit 52,258 51,773
Depreciation of property, plant and equipment 3,794 3,541
Depreciation of right of use assets 3,139 3,115
Profit on sale of property, plant and equipment (198) (64)
Defined benefit pension scheme service cost 500 620
Defined benefit pension scheme employer contributions paid (1,970) (4,144)
Changes in fair value of financial instruments 703 (90)
Share based payments 6 8
(Increase)/decrease in inventories (50,272) 6,346
(Increase) in trade and other receivables (7,451) (15,573)
Increase in trade and other payables 15,905 20,248
Cash inflow from operations 16,414 65,780
Taxation paid (9,879) (9,895)
Cash inflow from operating activities 6,535 55,885
Purchase of property, plant and equipment (3,248) (2,811)
Proceeds from disposal of property, plant and equipment 280 131
Cash outflow from investing activities (2,968) (2,680)
Interest received 42 48
Interest paid (20) (26)
Lease interest paid (143) (173)
Lease capital paid (3,233) (3,010)
Equity dividends paid (32,298) (34,083)
Shares issued 823 51
Cash outflow from financing activities (34,829) (37,193)
Net (decrease)/increase in cash and cash equivalents (31,262) 16,012
Effect of exchange differences 145 (196)
Cash and cash equivalents at start of year 83,261 67,445
Cash and cash equivalents at end of year 52,144 83,261
35
Notes to the Consolidated Financial Statements
1. General information
James Halstead plc (“the company” or “the parent company”) is a limited liability company, registered in England and Wales,
domiciled in the United Kingdom and listed on AIM on the London Stock Exchange. The address of its registered office is Beechfield,
Hollinhurst Road, Radcliffe, Manchester, M26 1JN.
2.
Accounting policies
Basis of preparation
On 31 December 2020, IFRS as adopted by the European Union at that date was brought into UK Law and became UK adopted
international accounting standards, with future changes being subject to endorsement by the UK Endorsement Board. The group
transitioned to UK adopted international accounting standards in its consolidated financial statements on 1 July 2021. There was
no impact or changes in accounting from the transition.
The group financial statements have been prepared in accordance with UK adopted international accounting standards. The
company financial statements have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure
Framework, and are presented separately following the group financial statements.
The group financial statements have been prepared on a going concern basis and on the historical cost basis as modified by the
valuation of certain financial assets and financial liabilities (being derivative instruments) at fair value.
Going concern
The directors have reviewed current performance and forecasts, combined with capital investment and expenditure commitments,
and a range of trading scenarios. The group has no net borrowings and owns the freeholds on many of its premises (the most
significant being four UK operating sites and two sites in Germany).
After considering current trading and forward forecasts, the directors have the reasonable expectation that the group has adequate
financial resources to continue in operation, including contractual and commercial commitments, for the foreseeable future.
As the global pandemic recedes, but with many markets now facing high energy costs and supply chain concerns, the directors have
considered that there may be a weakening of demand for flooring products in arriving at the conclusion above.
Fluctuations in exchange rates have been a constant factor since sterling floated in 1971. Our hedging delays the effect of sharp
changes.
Working with our senior executives we have considered scenarios for the purpose of the statutory audit that involve layoffs and
cessation of production in the winter months and, whilst we do not believe they are likely, have been considered to assess the going
concern concept. The cost and availability of international freight has continued to frustrate export sales and as part of the going
concern review we have factored in the scenario that this will continue for several months.
Based on the above the directors are satisfied the group has adequate resources to continue as a going concern for at least one
year from the date of approval of the financial statements.
Recent accounting developments
The financial statements are prepared in accordance with UK adopted international accounting standards and interpretations in
force at the reporting date. The group has not adopted any standards or interpretations in advance of the required implementation
dates.
36
2.
Accounting policies (continued)
Recent accounting developments (continued)
The following standards were adopted in the period.
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Interest Rate Benchmark Reform – Phase 2
There were no new standards, interpretations and amendments, which are not yet effective and have not been adopted early in
these financial statements, which will or may have an effect on the group’s future financial statements.
Basis of consolidation
The group financial statements consolidate the financial statements of the parent company and all its subsidiaries, as if they formed
a single entity. Subsidiaries are entities controlled by the group. Control exists if all three of the following elements are present:
power over the entity, exposure to variable returns from the entity, and the ability to affect those variable returns. Control is
reassessed whenever facts and circumstances indicate that there may be a change in any of these elements of control. Control is
normally achieved by a majority shareholding. The company, directly or through an intermediate subsidiary owned 100% of the
share capital of all of its subsidiaries. The results of subsidiaries acquired are consolidated from the date on which control passes to
the group. The results of disposed subsidiaries are consolidated up to the date on which control passes from the group. All intra-
group transactions and balances are eliminated on consolidation.
Segment reporting
Operating segments are those segments for which results are reviewed by the group’s chief operating decision maker (CODM) to
assess performance and make decisions about resources to be allocated. The CODM is the group board which meets regularly
throughout the year to discuss the performance and results of the group as a whole. The business of the group is the manufacture
and distribution of flooring products. The group operates through separate legal entities in certain areas of the world and in order
to provide information in a structured manner to readers of the accounts who are unfamiliar with the internal management
reporting of the group, these operations are discussed by the chief executive in his report. However, the directors consider that
under the definitions contained within IFRS 8 there is only one reportable segment, which is the group as a whole. This is consistent
with the core principle of IFRS 8, which is to disclose information to enable users of the financial statements to evaluate the nature
and financial effects of the business activities in which the group engages and the economic activities in which it operates.
Foreign currencies
Functional and presentation currency – the group’s consolidated financial statements are presented in pounds sterling, the
functional currency of the parent company, being the currency of the primary economic environment in which the parent company
operates.
Transactions and balances – transactions in foreign currencies are recorded at the rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are reported at the rates of exchange prevailing at the balance
sheet date. Exchange differences on retranslating monetary assets and liabilities are recognised in the income statement except
where they relate to qualifying cash flow hedges, in which case the exchange differences are deferred in equity.
Foreign subsidiaries – the results of foreign subsidiaries (none of which has the currency of a hyperinflationary economy), that have
a functional currency different from the group’s presentation currency, are translated at the average rates of exchange for the year.
Assets and liabilities of foreign subsidiaries, that have a functional currency different from the group’s presentation currency, are
translated at the exchange rates prevailing at the balance sheet date. Exchange differences arising from the translation of the results
of foreign subsidiaries and their opening net assets are recognised as a separate component of equity.
When a foreign subsidiary is sold the cumulative exchange differences relating to the retranslation of the net investment in that
foreign subsidiary are recognised in the income statement as part of the gain or loss on disposal. This applies only to exchange
differences recorded in equity after 1 July 2006. Exchange differences arising prior to 1 July 2006 remain in equity on disposal as
permitted by IFRS 1.
37
Notes to the Consolidated Financial Statements
continued
2.
Accounting policies (continued)
Intangible assets
Goodwill – goodwill arising on the acquisition of a subsidiary undertaking is the excess of the aggregate of the fair value of the
consideration transferred, the fair value of any previously held interests, and the recognised value of the non-controlling interest in
the acquiree over the net of the acquisition date amounts of the identifiable assets acquired and liabilities assumed. Goodwill is
reviewed for impairment at least annually and when there are indications that the carrying amount may not be recoverable. For
the purpose of impairment review, goodwill is allocated to the relevant cash generating unit (CGU) within the group. An
impairment loss is recognised if the carrying value of the goodwill or its CGU exceeds its recoverable amount. Any impairment
loss is recognised immediately in the income statement and is not subsequently reversed. On disposal of a subsidiary, the
attributable amount of goodwill is included in the calculation of the profit or loss on disposal. Goodwill arising on acquisitions
before the date of transition to IFRS has been retained at the UK GAAP value as at that date having been reviewed for impairment
at that date and subsequently at least annually.
Taxation
Income tax on the profit for the year comprises current and deferred tax. Income tax is recognised in the income statement except
to the extent that it relates to items recognised in other comprehensive income.
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to taxation authorities based
on tax rates and laws that are enacted at the balance sheet date. Deferred income tax is provided in full, using the liability method,
on temporary differences arising between the tax bases of assets and liabilities and their corresponding book values as recorded in
the group’s financial statements with the following exceptions:
where the temporary difference arises from the initial recognition of goodwill or of an asset or liability in a transaction that
is not a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss;
deferred income tax assets are recognised only to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences can be utilised;
deferred income tax is not provided on unremitted earnings of foreign subsidiaries where there is no likelihood to remit the
earnings.
Deferred income tax assets and liabilities are based on tax rates and laws that are substantively enacted at the balance sheet date.
Share-based payments
The group grants share options to certain of its employees. An expense in relation to such options based on their fair value at the
date of grant, is recognised over the vesting period. The group uses the Black Scholes model for the purpose of computing fair value.
Inventories
Inventories are measured at the lower of cost and net realisable value on a weighted average cost basis. Cost includes expenditure
incurred in acquiring the inventories and bringing them to their existing location and condition. In the case of finished and partly
finished goods, cost represents the cost of raw materials, direct labour, other direct costs and related production overheads on bases
consistently applied from year to year. In all cases provision is made for obsolete, slow-moving or defective items where appropriate.
Financial assets and liabilities
Financial assets comprise trade and other receivables and cash and cash equivalents. Financial liabilities comprise trade and other
payables.
38
2.
Accounting policies (continued)
Trade and other receivables
Trade and other receivables are non-interest bearing and are initially stated at fair value and then subsequently at amortised cost
less provision for lifetime expected credit losses using the simplified approach in IFRS 9. Estimated irrecoverable amounts are based
on historical experience and forward looking information, together with specific amounts that are not expected to be collectable.
Individual amounts are written off when management deems them not to be collectible.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks, short-term (with an original maturity of three
months or less) deposits and bank overdrafts. Bank overdrafts are disclosed as current liabilities except where the group participates
in offset arrangements with certain banks whereby cash and overdraft amounts are offset against each other. Cash and cash
equivalents are held at amortised cost.
Trade and other payables
Trade and other payables are non-interest bearing and are initially stated at fair value and then subsequently at amortised cost.
Pension scheme arrangements
The group operates several defined contribution pension schemes and a defined benefit pension scheme for certain of its United
Kingdom domiciled employees.
A defined contribution scheme is a scheme in which the group pays contributions into publicly or privately administered schemes
on a voluntary, statutory or contractual basis. The group has no further payment obligations once the contributions have been
made. The amount charged to the income statement is the contribution payable in the year. Differences between contributions
payable in the year and contributions actually paid are shown as receivables or payables in the balance sheet.
A defined benefit scheme is a scheme in which the amount of pension benefit that an employee will receive on retirement is
defined. For the defined benefit scheme, pension costs and the costs of providing other post retirement benefits are charged to the
income statement in accordance with the advice of qualified independent actuaries. Past service costs are recognised immediately
in the income statement. The service cost is charged against operating profit and the net interest cost is charged as a finance cost.
The net interest cost is calculated using the discount rate at the beginning of the period. The retirement benefit obligations
recognised on the balance sheet represent the difference between the fair value of the scheme’s assets and the present value of
the scheme’s defined benefit obligations measured at the balance sheet date. The defined benefit obligation is calculated annually
by independent actuaries using the projected unit method. Remeasurements of the net defined benefit obligations are recognised
in the period in which they arise in other comprehensive income. A net defined benefit obligations asset is recognised to the extent
that the group can realise an economic benefit from that asset.
Property, plant and equipment
Property, plant and equipment is recorded at cost less subsequent depreciation and impairment except for land which is shown at
cost less any impairment. Cost includes expenditure that is directly attributable to the acquisition of the asset. Depreciation is
calculated on the depreciable amount (being cost less the estimated residual value) on a straight line basis over the estimated
useful lives of the assets as follows:
Freehold land: Not depreciated
Freehold buildings: 10 to 50 years
Plant and equipment: 2 to 20 years
Residual values and useful lives are reviewed at each group balance sheet date for continued appropriateness and indications of
impairment and adjusted if appropriate.
39
Notes to the Consolidated Financial Statements
continued
2.
Accounting policies (continued)
Right of use assets and lease liabilities
A right of use asset and a lease liability are recognised for all leased asset contracts on their commencement, except for low value
leases and short term leases of one year or less.
On recognition, the right of use asset and lease liability are measured at the present value of the lease payments discounted over
the lease term. The discount rate used is the rate inherent in the lease if this can be determined, or the incremental borrowing rate.
Subsequent to initial recognition, the right of use assets are depreciated on a straight line basis over the shorter of the lease term
or the useful life of the asset. The lease liabilities are increased by the interest cost and reduced by the lease payments made. A
depreciation charge and an interest cost are recognised in the income statement.
The lease payments for low value and short term leases are expensed in the income statement on a straight line basis over the
lease term.
Revenue recognition
Revenue is from the sales of flooring products and is recognised at the point in time when control of the products has been
transferred to the customer. Sales are recognised on despatch of the goods to the customer. Control passes to the customer at the
point terms of despatch are met. Sales are invoiced at the time of despatch and payment terms are based on the invoice date.
Payment terms vary by customer, but do not exceed six months. Revenue is stated after provision for trade discounts and rebates
due on the sales. Revenue excludes VAT and sales taxes.
Research and development
Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and
understanding, is recognised in the income statement as an expense as incurred.
Development expenditure not meeting all the criteria for capitalisation contained in IAS 38 – Intangible Assets, is recognised in the
income statement as an expense as incurred.
Grants
Grants that compensate for expenses are recognised in the income statement in the same period and category in which the
expenses are recognised.
Dividends
Interim dividends are recognised when they are paid. Final dividends are recognised when they are approved by the shareholders.
Derivative financial instruments and hedging
The group uses derivative financial instruments to hedge its exposure to foreign currency transactional risk. In accordance with its
treasury policy the group does not hold or issue derivative financial instruments for trading purposes.
Derivative financial instruments are recorded at fair value on the date the derivative contract is entered into and are subsequently
remeasured at fair value at each group balance sheet date.
The method by which any gain or loss arising from remeasurement is recognised depends on whether the instrument is designated
as a hedging instrument and, if so, the nature of the item being hedged. The group recognises an instrument as a hedging
instrument by documenting at the inception of the transaction the relationship between the instrument and the hedged items and
the objectives and strategy for undertaking the hedging transaction. To be designated as a hedging instrument, an instrument must
also be assessed, at inception and on an ongoing basis, to be highly effective in offsetting changes in cash flows of hedged items.
40
Accounting policies (continued)
2.
Derivative financial instruments and hedging (continued)
For derivatives not used in hedging transactions, the gain or loss on remeasurement of fair value is recognised immediately in the
income statement.
Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised asset or liability, or
of a highly probable forecast future transaction, the gain or loss on remeasurement which relates to the portion of the hedge which
is deemed effective is recognised directly in equity, with the balance of the gain or loss, relating to the ineffective portion, being
recognised immediately in the income statement.
Amounts accumulated in equity are recycled in the income statement in the periods when the hedged item affects profit or loss.
The fair value of forward foreign exchange contracts is determined using forward exchange market rates at the balance sheet date.
Financial risk management
3.
Financial risk and treasury policies
A full description of the James Halstead plc group’s treasury policy is contained in the financial director’s review.
The group’s activities expose it to a number of financial risks as detailed below. These risks are managed, with the objective of
limiting adverse effects, from the group’s head office in accordance with policies determined by and decisions made by the group
board.
There have been no changes in financial risks from the previous year.
Market risks
Market risk is the risk that changes in market prices, such as currency exchange rates and interest rates will affect the group’s results.
The objective of market risk management is to control it within suitable parameters.
(a) Foreign exchange risk
The group operates internationally and is exposed to foreign currency risk on sales and purchases that are denominated in a
currency other than the functional currency of the entity making the sale or purchase. There are a range of currencies giving rise to
this risk, but most significant is the euro. To mitigate risks associated with future exchange rate fluctuations, the group’s policy is
to use forward exchange contracts to hedge its known and certain forecast transaction exposures based on historical experience
and projections. The group hedges at least 25% but rarely more than 100% of the next twelve months’ anticipated exposure.
(b) Interest rate risk
The group does not use derivative financial instruments to mitigate its exposure to interest rate risk. The main element of interest
rate risk concerns sterling deposits which are made on floating market based rates and short-term overdrafts in foreign currencies
which are also on floating rates.
41
Notes to the Consolidated Financial Statements
continued
3.
Financial risk management (continued)
Credit risk
Credit risk is the risk of financial loss to the group if a customer or counterparty to a financial instrument fails to meet its
contractual obligations and arises principally from the group’s trade receivables from customers and monies on deposit with
financial institutions.
With regard to trade receivables, the group is not subject to significant concentration of credit risk. Exposure is spread across a large
number of companies and the underlying local economic and sovereign risks vary across the world. Trade receivable exposures are
managed locally in the individual operating units where they arise and credit limits are set as deemed appropriate. Where
practicable and deemed necessary the group endeavours to minimise credit risks by the use of trade finance instruments such as
letters of credit and insurance.
The group controls credit risk in relation to counterparties to other financial instruments by dealing only with highly rated financial
institutions.
The group’s maximum credit exposure on financial assets is represented by their book value.
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.
Capital risk
The group’s objectives in managing capital are to safeguard the ability of all entities within the group to continue as going concerns,
whilst maximising the overall return to shareholders over time. The capital structure of the group consists of equity attributable
to equity holders of the parent company less cash and cash equivalents.
The group will only usually take on borrowings where those borrowings would be financed by the cash expected to be generated
by the related investment opportunity and where the borrowing would not significantly increase the group’s exposure to risk.
At the year end the group had preference shares classified as debt of £200,000.
Critical accounting estimates and judgements
4.
The preparation of financial statements in conformity with generally accepted accounting principles requires the use of certain
estimates and associated assumptions that affect the application of policies, the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these
estimates are based on management’s best assessments of amounts, events or actions, actual results may ultimately differ from
those estimates. The estimates and underlying assumptions are reviewed on a regular and ongoing basis. There are no significant
judgements.
The estimates that have had the most significant effect on the amounts included in these consolidated financial statements are as
follows:
42
4.
Critical accounting estimates and judgements (continued)
Inventories
For financial reporting purposes the group evaluates its inventory to ensure it is carried at the lower of cost or net realisable value.
Provision is made against slow moving, obsolete and damaged inventories. Damaged inventories are identified and written down
through the inventory counting procedures conducted within each business. Provision for slow moving and obsolete inventories is
assessed by each business as part of their ongoing financial reporting. Obsolescence is assessed based on comparison of the level
of inventory holding to the projected likely future sales. Future sales are assessed based on historical experience, and adjusted where
the market conditions are known to have changed. To the extent that future events impact the saleability of inventory these
provisions could vary significantly. For example, changes in specifications or regulations may render inventory, previously considered
to have a realisable value in excess of cost, obsolete and require such inventory to be fully written off.
Expected credit losses
Provision is made against trade receivables for lifetime expected credit losses using the simplified approach in IFRS 9. Within each
of the operating units, assessment is made locally of the recoverability of trade receivables based on a range of factors including
the age of the receivable, the creditworthiness of the customer and forward looking information. Determining the recoverability of
an account involves estimation as to the likely financial condition of the customer and their ability to subsequently make payment.
If the group is cautious as to the financial condition of the customer the group may provide for accounts that are subsequently
recovered. Similarly, if the group is optimistic as to the financial condition of the customer, the group may not provide for an
account that is subsequently determined to be irrecoverable. In recent years the group has not experienced significant variation in
the amount charged to the income statement in respect of doubtful accounts, when compared to sales. Further details are provided
in note 20.
Income taxes
In determining the group’s provisions for income tax and deferred tax it is necessary to consider transactions in a small number of
key tax jurisdictions for which the ultimate tax determination is uncertain. To the extent that the final outcome differs from the
tax that has been provided, adjustments will be made to income tax and deferred tax provisions held in the period the
determination is made.
Retirement benefit obligations
The liability recognised in respect of retirement benefit obligations is dependent on a number of estimates including those relating
to mortality, inflation, salary increases, and the rate at which liabilities are discounted. Any change in these assumptions would
impact the retirement benefit obligations recognised. Further details on these estimates are provided in note 26.
43
Notes to the Consolidated Financial Statements
continued
Segmental information
5.
Operating segments are those segments for which results are reviewed by the group’s chief operating decision maker (CODM) to
assess performance and make decisions about resources to be allocated. The CODM is the group board which meets regularly
throughout the year to discuss the performance and results of the group as a whole. The business of the group is focussed almost
entirely on the manufacture and distribution of flooring products. The directors consider that under the definitions contained within
IFRS 8 there is only one reportable segment, which is the group as a whole. This is consistent with the core principle of IFRS 8, which
is to disclose information to enable users of the financial statements to evaluate the nature and financial effects of the business
activities in which the group engages and the economic activities in which it operates. Therefore the majority of the disclosures
required under IFRS 8 have already been given in these financial statements.
Segment assets comprise property, plant and equipment, right of use and intangible assets. Geographical disclosures in respect of
revenues and segment assets are provided below and include revenue for Germany of £62,553,000 (2021: £55,656,000) and assets
in Germany of £9,016,000 (2021: £10,560,000).
Revenue
United Kingdom
Europe and Scandinavia
Australasia and Asia
Rest of the World
Assets
United Kingdom
Europe and Scandinavia
Australasia and Asia
Rest of the World
Total segment assets
Retirement benefit obligations
Deferred tax assets
Total non-current assets
2022
£’000
110,612
121,109
38,021
22,118
2021
£’000
98,243
111,863
38,386
17,870
291,860
266,362
2022
£’000
30,018
10,544
4,870
105
45,537
6,144
234
51,915
2021
£’000
30,213
12,021
3,900
355
46,489
–
254
46,743
Revenue is by location of customer. Assets are by location of asset.
Employee profit share
6.
Profit for the year is after charging the cost of the James Halstead plc share ownership plan. Since 1980 the group has operated an
employee share scheme, approved under the Finance Act 1978. In December 2001 the shareholders approved a new share ownership
plan in line with the requirements of legislative changes. The aim of this scheme is to enable employees to build up a personal
shareholding in James Halstead plc and to participate in its continued expansion and success as shareholders as well as employees.
As members of the scheme the following directors received shares to the value of, Mr M Halstead £nil and Mr G R Oliver £nil.
Profit before income tax
7.
Profit before tax is stated after charging/(crediting) the following:
Depreciation of property, plant and equipment
Depreciation of right of use assets
Profit on disposal of property, plant and equipment
Research and development
Government grant income for business support UK and overseas
Fees payable to the group’s auditor for the audit of the parent company and
consolidated financial statements
Fees payable to the group’s auditor and its associates for other services:
The audit of the group’s subsidiaries pursuant to legislation
Taxation compliance
Other services
8.
Staff costs and numbers
Staff costs comprised:
Wages and salaries
Social security costs
Pension costs – defined benefit scheme
– defined contribution schemes
Share based payments
The average monthly number of employees during the year was:
Manufacturing, selling and distribution
Administration
The directors’ remuneration was:
Salary or fees
Bonuses
Benefits
Total remuneration excluding pension contributions
Pension contributions
44
2021
£’000
3,541
3,115
(64)
1,484
(1,668)
50
122
39
3
2021
£’000
36,284
4,353
620
836
8
42,101
2022
£’000
3,794
3,139
(198)
1,549
(112)
55
148
–
–
2022
£’000
37,092
4,564
500
907
6
43,069
2022
Number
2021
Number
654
165
819
2022
£’000
1,004
1,000
25
2,029
25
2,054
660
159
819
2021
£’000
968
926
24
1,918
25
1,943
Social security costs related to this remuneration
272
257
45
Notes to the Consolidated Financial Statements
continued
9.
Finance income
Bank deposit interest
Other interest
Finance income
10. Finance cost
Other interest
Preference share dividend
Lease interest
Net pension interest cost
Finance cost
11.
Income tax expense
Current tax
Current tax – current year
Current tax – adjustments in respect of prior years
Deferred tax
Deferred tax – current year temporary differences
Deferred tax – current year tax rate difference
Deferred tax – adjustments in respect of prior years
Total taxation
2022
£’000
36
6
42
2022
£’000
9
11
20
143
74
237
2022
£’000
11,310
(516)
10,794
565
137
239
941
11,735
2021
£’000
44
4
48
2021
£’000
15
11
26
173
354
553
2021
£’000
10,733
(415)
10,318
650
224
215
1,089
11,407
Current tax includes £3,737,000 (2021: £3,666,000) of overseas tax.
The effective tax rate for the year to 30 June 2022 is higher (2021: higher) than the standard rate of corporation tax in the UK. The
differences are explained below:
Profit before tax
Profit before tax multiplied by the standard rate of corporation tax in
the UK of 19% (2021: 19%)
Effects of:
Adjustments to tax in respect of prior periods
Overseas tax rates
Disallowable items
Deferred tax rate difference
Total taxation
2022
£’000
52,063
2021
£’000
51,268
9,892
9,741
(277)
1,659
324
137
11,735
(200)
1,469
173
224
11,407
In addition to the amounts above £2,015,000 has been charged (2021: £2,981,000 charged) as other comprehensive income in
respect of the remeasurement of the net defined benefit liability, and has been netted off the amounts shown in the Consolidated
Statement of Comprehensive Income.
At 30 June 2022 the UK corporation tax rate was enacted to change to 25% on 1 April 2023. The UK deferred tax balances at 30
June 2022 were measured at 25%. On 23 September 2022 the UK government proposed to keep the UK corporation tax at 19%,
and this is still to be enacted.
12. Earnings per share
Profit for the year attributable to equity shareholders
Weighted average number of shares in issue
Dilution effect of outstanding share options
Diluted weighted average number of shares
Basic earnings per 5p ordinary share
Diluted earnings per 5p ordinary share
46
2022
£’000
40,328
2021
£’000
39,861
416,586,675
416,283,040
201,425
246,330
416,788,100
416,529,370
9.7p
9.7p
9.6p
9.6p
The earnings per 5p ordinary share are attributable to equity shareholders.
The figures for the year ended 30 June 2021 have been restated for the effect of the one-for-one bonus issue on 14 January 2022.
13. Dividends
Equity dividends
Interim dividend for previous year of nil (2021: 2.125p)
Final dividend for previous year of 11.00p (2021: 10.00p)
Interim dividend for current year of 2.25p (2021: 4.25p)
Amounts recognised as distributions to equity shareholders in the year
2022
£’000
–
22,921
9,377
32,298
2021
£’000
4,423
20,814
8,846
34,083
A final dividend of 5.50p per share for the year ended 30 June 2022, amounting to £22,921,000 will be proposed at the Annual
General Meeting.
14. Profit of the parent company
The company has taken advantage of the provisions of Section 408 of the Companies Act 2006 and elected not to present its own
profit and loss account. The profit after taxation for the financial year dealt with in the financial statements of the company was
£30,797,000 (2021: £43,332,000). The aggregate amount of directors’ emoluments excluding pension contributions was
£2,029,000 (2021: £1,918,000) of which the highest paid director’s emoluments were £978,000 (2021: £922,000). The directors’
salaries or fees for the year ended 30 June 2022 were Mr J A Wild £40,000, Mr M Halstead £463,000, Mr G R Oliver £436,000,
Mr S D Hall £25,000, Mr M J Halstead £20,000 and Mr R P Whiting £20,000.
47
Notes to the Consolidated Financial Statements
continued
15. Property, plant and equipment
Cost
At 30 June 2020
Additions
Disposals
Exchange differences
At 30 June 2021
Additions
Disposals
Exchange differences
At 30 June 2022
Depreciation
At 30 June 2020
Charge for the year
Disposals
Exchange differences
At 30 June 2021
Charge for the year
Disposals
Exchange differences
At 30 June 2022
Net book value
At 30 June 2020
At 30 June 2021
At 30 June 2022
Freehold
land and
buildings
£’000
Plant and
equipment
£’000
28,215
406
–
(579)
28,042
311
–
27
28,380
10,573
680
–
(199)
11,054
676
–
13
11,743
17,642
16,988
16,637
74,399
2,405
(733)
(341)
75,730
2,937
(783)
119
78,003
53,521
2,861
(666)
(240)
55,476
3,118
(701)
76
57,969
20,878
20,254
20,034
Total
£’000
102,614
2,811
(733)
(920)
103,772
3,248
(783)
146
106,383
64,094
3,541
(666)
(439)
66,530
3,794
(701)
89
69,712
38,520
37,242
36,671
16. Right of use assets
Cost
At 30 June 2020
Additions
Disposals
Exchange differences
At 30 June 2021
Additions
Disposals
Exchange differences
At 30 June 2022
Depreciation
At 30 June 2020
Charge for the year
Disposals
Exchange differences
At 30 June 2021
Charge for the year
Disposals
Exchange differences
At 30 June 2022
Net book value
At 30 June 2020
At 30 June 2021
At 30 June 2022
17.
Intangible assets
Cost and net book value at 30 June 2020, 2021 and 2022
48
Right of use
assets
£’000
8,883
3,471
(696)
(332)
11,326
2,641
(1,276)
251
12,942
3,011
3,115
(675)
(140)
5,311
3,139
(1,276)
134
7,308
5,872
6,015
5,634
Goodwill
£’000
3,232
An impairment review of goodwill was done by reference to value in use. Value in use was determined using conservative five year
plus terminal value cash flow projections, based on current levels of profitability and assumed conservative growth rates of 0% to
5% and discount rates of 7% to 11%. The result of the review indicated that no impairment was required with no reasonable
sensitivities indicating an impairment.
49
Notes to the Consolidated Financial Statements
continued
18. Deferred tax assets and liabilities
Deferred tax assets
Deferred tax liabilities
At 30 June 2020
Credited/(charged) to income
Charged to other comprehensive income
Exchange differences
At 30 June 2021
Credited/(charged) to income
Charged to other comprehensive income
Exchange differences
At 30 June 2022
2022
£’000
234
(2,929)
(2,695)
Retirement
benefit
obligations
£’000
Accelerated
tax
depreciation
£’000
Other
timing
differences
£’000
4,411
(602)
(2,981)
–
828
(349)
(2,015)
–
(1,536)
(1,124)
(585)
–
–
(1,709)
(87)
–
–
(1,796)
1,047
98
–
(10)
1,135
(505)
–
7
637
2021
£’000
254
–
254
Total
£’000
4,334
(1,089)
(2,981)
(10)
254
(941)
(2,015)
7
(2,695)
Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets against current tax
liabilities and the deferred income taxes relate to the same tax authority. All deferred tax assets and liabilities are analysed as non-
current.
19.
Inventories
Raw materials and consumables
Work in progress
Finished goods
2022
£’000
8,161
2,258
101,860
112,279
2021
£’000
4,726
1,262
54,696
60,684
An amount of £1,283,000 has been charged (2021: £904,000 credited) to the income statement in respect of movements in
inventory write-downs. The cost of inventory recognised as an expense was £178,355,000 (2021: £154,722,000).
20. Trade and other receivables
Trade receivables
Other receivables
Prepayments
50
2022
£’000
46,734
1,781
2,656
51,171
2021
£’000
39,262
1,258
2,429
42,949
All amounts within trade and other receivables are due within one year. The fair value of amounts included in trade and other
receivables approximates to book value. The maximum exposure to credit risk at the reporting date is the fair value of each class
of receivable. The group does not hold any collateral as security.
The group’s trade receivables are stated after a provision for expected credit losses of £1,820,000 (2021: £1,746,000). The provision
against trade receivables for expected credit losses is based on specific risk assessments taking into account past default experience
and appropriate forward looking information. The provision is analysed as follows:
Opening balance
Exchange differences
Debts written off
Charged to income
Closing balance
Not past due
Up to three months past due
Over three months past due
Loss rate
2022
%
2
5
93
Gross
2022
£’000
34,143
13,736
675
48,554
Provision
2022
£’000
541
651
628
1,820
Loss rate
2021
%
2
21
100
The maximum exposure to credit risk for trade and other receivables by currency was:
Sterling
Euro
Australian Dollar
New Zealand Dollar
Canadian Dollar
Norwegian Krone
US Dollar
Hong Kong Dollar
Other currencies
Total
2022
£’000
1,746
12
(135)
197
1,820
Gross
2021
£’000
38,013
2,433
562
41,008
2022
£’000
22,896
13,985
3,650
844
792
977
3,818
221
1,332
48,515
2021
£’000
1,588
(14)
(66)
238
1,746
Provision
2021
£’000
674
512
560
1,746
2021
£’000
19,852
11,574
3,429
1,012
1,057
586
1,178
753
1,079
40,520
51
Notes to the Consolidated Financial Statements
continued
21. Cash and cash equivalents
The fair values of cash and cash equivalents approximate to book value due to their short maturities.
The currency analysis of cash and cash equivalents is as follows:
Sterling
Euro
Australian Dollar
New Zealand Dollar
Canadian Dollar
Norwegian Krone
US Dollar
Other currencies
Total
22. Trade and other payables
Amounts falling due within one year
Trade payables
Value added, payroll and other taxes
Other payables
Accruals
2022
£’000
29,483
3,533
2,023
599
1,396
335
13,223
1,552
52,144
2022
£’000
61,466
5,565
1,355
16,121
84,507
2021
£’000
64,530
3,258
2,615
161
808
805
10,061
1,023
83,261
2021
£’000
40,949
6,238
2,594
15,770
65,551
Amounts falling due after more than one year
Other payables
453
447
The fair value of amounts included in trade and other payables approximates to book value.
23. Lease liabilities
Opening balance
Leases started
Leases cancelled
Lease interest
Lease payments
Exchange differences
Closing balance
Amounts payable in less than one year
Amounts payable in more than one year
All amounts are payable within five years.
2022
£’000
6,184
2,641
–
143
(3,376)
122
5,714
2,166
3,548
5,714
2021
£’000
5,939
3,471
(21)
173
(3,183)
(195)
6,184
2,948
3,236
6,184
24. Preference shares
Preference shares
52
2022
£’000
200
2021
£’000
200
The cumulative preference shares have no fixed repayment date. They are not listed and therefore no market price is available. At
30 June 2022 and 30 June 2021 the fair value of the preference shares was not materially different from their book value.
25. Net cash analysis
At 30 June 2020
Cash flow
Other changes
Exchange differences
At 30 June 2021
Cash flow
Other changes
Exchange differences
At 30 June 2022
Cash
and cash
equivalents
£’000
67,445
16,012
–
(196)
83,261
(31,262)
–
145
52,144
Lease
liabilities
£’000
Preference
shares
£’000
(5,939)
3,183
(3,623)
195
(6,184)
3,376
(2,784)
(122)
(5,714)
(200)
–
–
–
(200)
–
–
–
(200)
Net
cash
£’000
61,306
19,195
(3,623)
(1)
76,877
(27,886)
(2,784)
23
46,230
26. Retirement benefit obligations
In the UK the group operates a defined benefit pension scheme which was closed to new members in 2002. In addition some
employees both in the UK and overseas are provided with retirement benefits through defined contribution arrangements.
Executive directors Mr M Halstead and Mr G R Oliver are members of the defined benefit scheme and the employer pension
contributions for the year were £25,000 and £nil respectively. At 30 June 2022 the accrued pension for the highest paid
director was £131,000 and the transfer value of this accrued benefit was £2,557,000.
Disclosures relating to the defined benefits pension scheme are as follows:
The company sponsors the Halstead Group Pension Scheme, a funded defined benefit pension scheme in the UK. The scheme is
administered within a trust which is legally separate from the company. Trustees are appointed by both the company and the
scheme’s membership and act in the interest of the scheme and all relevant stakeholders, including the members and the company.
The trustees are also responsible for the investment of the scheme’s assets.
Existing members accrue an annual pension of 1/60th or 1/80th (depending on category) of final salary for each year of pensionable
service, increasing in line with inflation whilst in payment. On the death of an active member the scheme provides the widow(er)
a lump sum and a spouse’s pension. Members who leave service before retirement are entitled to a deferred pension.
Active members of the scheme pay contributions at the rate of either 7.5% or 6% of salary depending on category and the
company pays the balance of the cost as determined by regular actuarial valuations.
The scheme poses a number of risks to the company, for example, longevity risk, investment risk, interest rate risk, inflation risk and
salary risk. The trustees are aware of these risks and use various techniques to control them. The trustees have a number of internal
control policies including a risk register, which are in place to manage and monitor the various risks they face.
53
Notes to the Consolidated Financial Statements
continued
26. Retirement benefit obligations (continued)
The scheme is subject to regular actuarial valuations, which are usually carried out every three years. These actuarial valuations are
carried out in accordance with the requirements of the Pensions Act 2004 and so include margins for prudence. This contrasts with
these accounting disclosures, which are determined using best estimate assumptions.
The last formal actuarial valuation was carried out as at 5 April 2020. The results of that valuation have been projected forward to
30 June 2022 by a qualified independent actuary. The figures in the following disclosure were measured using the Projected Unit
Method.
On 26 October 2018, the High Court reached a judgement in relation to Lloyds Banking Group’s defined benefit pension schemes
which concluded that schemes should equalise pension benefits for men and women as regards guaranteed minimum pension
benefits. The impact of this judgement on the scheme has been estimated and included in the pension liability.
At the end of the reporting period the scheme was in surplus as measured under the principles of IAS19. Under the accounting
standard an entity is allowed to recognise a pension scheme surplus on its balance sheet to the extent that it is able to realise an
economic benefit from that surplus.
The directors have reviewed the rules of the scheme and have concluded that the company can gain full economic benefit from
the scheme on the basis that the rules provide it access to any surplus after the last member has no further benefits in the scheme
(referred to in the standard as gradual settlement). Furthermore, the rules are such that the trustees are not able to take any actions
that would reduce the accounting surplus, such as benefit augmentations or triggering a scheme wind-up, without the company’s
action or consent.
Principal actuarial assumptions at the balance sheet date
Discount rate at end of year
Future salary increases
Future pension increases
Rate of inflation – RPI
– CPI
Future expected lifetime of current pensioner at age 65:
Male born in 1957
Female born in 1957
Future expected lifetime of future pensioner at age 65:
Male born in 1977
Female born in 1977
The sensitivities of the principal assumptions used to measure the scheme liabilities are as follows:
Assumption
Discount rate
Rate of inflation
Expected lifetime
Change in assumption
Decrease by 0.1%
Increase by 0.1%
Increase by 1 year
2022
2021
4.00%
2.45%
2.95%
3.05%
2.45%
2.05%
2.55%
3.00%
3.15%
2.55%
21.0 years
23.4 years
20.9 years
23.3 years
22.3 years
24.9 years
22.3 years
24.8 years
Impact on scheme liabilities
Increase by £0.8m
Increase by £0.5m
Increase by £2.7m
The sensitivities may not be representative of the actual change in the present value of the scheme obligations, as it is unlikely that
the change in assumptions would occur in isolation of each other, as the assumptions may be linked.
Amounts recognised in the balance sheet
Present value of funded obligations
Fair value of scheme assets
Net asset/(liability) before deferred taxation
Related deferred tax (liability)/asset
Net asset/(liability) after deferred taxation
2022
£’000
(63,092)
69,236
6,144
(1,536)
4,608
2021
£’000
(81,622)
77,265
(4,357)
828
(3,529)
26. Retirement benefit obligations (continued)
Amounts recognised in the income statement
Current service cost
Net interest cost
Amounts recognised in other comprehensive income
Return on assets excluding amount included in net interest cost
Gain arising from changes in financial assumptions
Gain arising from changes in demographic assumptions
Experience (loss)/gain
Deferred tax
Remeasurement of the net defined benefit liability
The actual return on the scheme assets in the year was a £6,980,000 loss (2021: £10,118,000 gain).
Changes in the present value of the scheme assets
Opening fair value of scheme assets
Interest income
Return on assets excluding interest income
Employer contributions
Employee contributions
Benefits paid
Changes in the present value of the scheme obligations
Opening defined benefit obligations
Service cost
Interest cost
Employee contributions
Gain arising from changes in financial assumptions
Gain arising from changes in demographic assumptions
Experience (loss)/gain
Benefits paid
54
2021
£’000
(620)
(354)
(974)
2021
£’000
9,009
877
3,405
2,398
15,689
(2,981)
12,708
2021
£’000
67,272
1,109
9,009
4,144
181
(4,450)
77,265
2021
£’000
(90,488)
(620)
(1,463)
(181)
877
3,405
2,398
4,450
2022
£’000
(500)
(74)
(574)
2022
£’000
(8,553)
18,303
–
(645)
9,105
(2,015)
7,090
2022
£’000
77,265
1,573
(8,553)
1,970
152
(3,171)
69,236
2022
£’000
(81,622)
(500)
(1,647)
(152)
18,303
–
(645)
3,171
(63,092)
(81,622)
55
Notes to the Consolidated Financial Statements
continued
26. Retirement benefit obligations (continued)
Changes in the net defined benefit asset/(liability)
Opening net defined benefit liability
Service cost
Net interest cost
Return on assets excluding interest income
Gain arising from changes in financial assumptions
Gain arising from changes in demographic assumptions
Experience (loss)/gain
Employer contributions
Major categories of scheme assets
UK and overseas equities
Diversified growth fund
Liability driven assets
Cash
Total market value of assets
The scheme has no investments in the company or in property occupied by the company.
Scheme liabilities by category of membership
Active members
Deferred pensioners
Pensions in payment
Average duration of scheme liabilities
Active members
Deferred pensioners
Pensions in payment
All scheme liabilities
2022
£’000
(4,357)
(500)
(74)
(8,553)
18,303
–
(645)
1,970
6,144
2022
£’000
–
55,154
6,256
7,826
69,236
2022
£’000
22,559
7,883
32,650
63,092
2022
years
15
16
9
12
2021
£’000
(23,216)
(620)
(354)
9,009
877
3,405
2,398
4,144
(4,357)
2021
£’000
17,023
51,090
8,057
1,095
77,265
2021
£’000
28,842
11,877
40,903
81,622
2021
years
17
18
11
14
Normal company contributions of £1,907,000 are expected to be paid into the scheme during the year ended 30 June 2023.
27. Share capital
Ordinary shares – allotted, issued and fully paid
Opening ordinary shares of 5p each
Ordinary shares of 5p each issued
Ordinary shares of 5p each bonus issue
Closing ordinary shares of 5p each
Ordinary B shares of 1p each
Total allotted, issued and fully paid
2022
Number
2021
Number
208,159,916
212,110
208,372,026
208,141,108
18,808
–
416,744,052
208,159,916
16,042,530
16,042,530
2022
£’000
10,408
11
10,418
20,837
160
20,997
56
2021
£’000
10,407
1
–
10,408
160
10,568
The ordinary shares of 5p each were issued during the year for a consideration of £823,000 (2021: £51,000).
The issued share capital was increased by a bonus issue of one fully paid ordinary share for each fully paid ordinary share held on
the register at 14 January 2022.
The preference shares detailed below are included as financial instruments within creditors. Full details of these are given in note
11 of the financial statements of the company.
Allotted, issued and fully paid
200,000 5.5% preference shares of £1 each
2022
£’000
200
2021
£’000
200
Throughout the remainder of this note all share numbers and share prices have been adjusted for the effect of the one-for-one
bonus issue on 14 January 2022.
Ordinary shares under option
Under the terms of the executive share option scheme approved on 3 December 1998, share options were granted and exercised
during the year. The share options outstanding are as follows:
Date of
grant
Date
exercisable
21 Jul 14
12 Jun 17
18 Oct 18
21 Jul 14
12 Jun 17
18 Oct 18
21 Jul 17
12 Jun 20
18 Oct 21
21 Jul 17
12 Jun 20
18 Oct 21
Date of
expiry
20 Jul 24
11 Jun 27
17 Oct 28
20 Jul 24
11 Jun 27
17 Oct 28
Exercise
price
(pence)
135.145
238.250
195.415
135.145
238.250
195.415
21 Jul 14
12 Jun 17
22 Dec 17
18 Oct 18
4 Oct 21
27 Jun 22
21 Jul 17
12 Jun 20
22 Dec 20
18 Oct 21
4 Oct 24
27 Jun 25
20 Jul 24
11 Jun 27
21 Dec 27
17 Oct 28
3 Oct 31
26 Jun 31
135.145
238.250
218.040
195.415
262.665
205.330
Director
M Halstead
G R Oliver
Total – directors
Employees
Total – employees
Grand total
Number
30.06.21
Exercised
in the year
Granted
in the year
17,802
100,000
120,000
24,582
100,000
120,000
482,384
10,000
340,000
40,000
650,000
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(10,000)
–
–
(414,220)
–
–
–
–
–
–
690,000
20,000
Number
30.06.22
17,802
100,000
120,000
24,582
100,000
120,000
482,384
–
340,000
40,000
235,780
690,000
20,000
1,040,000
(424,220)
710,000
1,325,780
1,522,384
(424,220)
710,000
1,808,164
57
Notes to the Consolidated Financial Statements
continued
27. Share capital (continued)
The market price of the shares at 30 June 2022 was 203p (2021: 260p). The share price during the year ranged from 200p to 314p.
Directors exercised nil (2021: 37,616) share options during the year. Aggregate gains on exercising the share options by directors in
the year amounted to £nil (2021: £46,000) of which £nil (2021: £27,000) related to the highest paid director.
A summary of movements in numbers of share options is as follows:
At 30 June 2020
Exercised in the year
Lapsed in the year
At 30 June 2021
Exercised in the year
Granted in the year
At 30 June 2022
Weighted
average
exercise
price
208p
135p
239p
209p
194p
261p
231p
Number of
options
1,600,000
(37,616)
(40,000)
1,522,384
(424,220)
710,000
1,808,164
At 30 June 2022 there were 1,098,164 (2021: 52,384) share options exercisable at a weighted average exercise price of 215p
(2021: 135p).
The weighted average remaining contractual life of share options outstanding at 30 June 2022 was 7.0 years (2021: 6.7 years).
Share based payments
The group’s equity settled share based payments comprise the grant of share options to certain employees under the group’s
executive share option scheme. Details of such options are given above. The group calculated the fair value of the options at the
date of grant using the Black Scholes model.
An expense based on the fair value calculated at the date of grant was recognised in the income statement over the vesting period
of the options. The share based payment expense for the year ended 30 June 2022 was £6,000 (2021: £8,000).
The inputs into the Black Scholes model for the share options granted in the year were as follows:
Expected life of option
Expected share price volatility
Expected dividend yield
Risk free interest rate
Exercise price
3 Years
17.5%
3.5%
0.8%
263p
3 Years
17.5%
3.9%
1.9%
205p
58
28. Reserves
The nature and purpose of each reserve within equity is as follows.
Reserve
Equity share capital
Share premium account
Capital redemption reserve
Currency translation reserve
Hedging reserve
Retained earnings
Description and purpose
Nominal value of equity share capital issued.
Amount subscribed for equity share capital in excess of nominal value.
Amounts transferred from share capital on redemption of issued shares.
Cumulative currency translation gains and losses arising on the
retranslation of the net assets of the group’s foreign operations.
Gains and losses arising on the fair value of financial instruments in an
effective designated cash flow hedging relationship.
All other gains and losses and transactions with owners, such as
dividends, not recognised in other reserves.
The share premium account and capital redemption reserve were utilised in paying up at par the new ordinary shares issued for
the bonus issue on 14 January 2022.
29. Derivative financial instruments
The group is exposed to foreign currency risk on sales and purchases that are denominated in a currency other than the functional
currency of the entity concerned. The currencies giving rise to this risk are various, but the most significant are the US Dollar and
the Euro. Forward exchange contracts are used to manage this exposure to fluctuations in foreign exchange rates. The group buys
or sells foreign currency at spot where necessary to address any short-term imbalances.
The group hedges, using forward exchange contracts, transactions denominated in a foreign currency which are not matched
against other transactions in the same currency within the group. The forward exchange contracts have maturities of less than one
year after the balance sheet date.
The group classifies its forward exchange contracts hedging forecasted transactions as cash flow hedges and states them at fair
value. The hedged cash flows are expected to occur within one year after the balance sheet date.
The fair values have been calculated by applying (where relevant), for equivalent maturity profiles, the rate at which forward
currency contracts with the same principal amounts could be acquired at the balance sheet date.
Changes in the fair value of forward exchange contracts for which no hedge accounting is applied or where the hedge is considered
ineffective are recognised in the income statement.
Other than the use of forward exchange contracts as detailed above, the group does not make use of derivative financial
instruments.
59
Notes to the Consolidated Financial Statements
continued
30. Financial instruments
For cash and cash equivalents and trade and other payables and receivables the fair value approximates to their book value due to the
short maturity profile of these financial instruments. On receivables, allowances are made within the book value for credit risk. The fair
value of forward exchange contracts is determined by reference to spot rates adjusted for the forward points to the contract value date.
The book values and fair values of financial instruments are set out below:
Current:
Trade and other receivables
Forward exchange contracts
Cash and cash equivalents
Trade and other payables
Forward exchange contracts
Lease liabilities
Total
Non-current:
Other payables
Lease liabilities
Preference shares
Total
2022
Book value
£’000
2022
Fair value
£’000
2021
Book value
£’000
2021
Fair value
£’000
48,515
2,166
52,144
(78,942)
(517)
(2,166)
21,200
(453)
(3,548)
(200)
(4,201)
48,515
2,166
52,144
(78,942)
(517)
(2,166)
21,200
(453)
(3,548)
(200)
(4,201)
40,520
848
83,261
(59,313)
(92)
(2,948)
62,276
(447)
(3,236)
(200)
(3,883)
40,520
848
83,261
(59,313)
(92)
(2,948)
62,276
(447)
(3,236)
(200)
(3,883)
Other than forward exchange contracts which are categorised as derivative instruments, all financial assets are categorised as financial
assets measured at amortised cost and all financial liabilities are categorised as financial liabilities measured at amortised cost.
The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value.
IFRS 7 requires that these be grouped into Levels 1 to 3 based on the degree to which the fair value is observable. All items in the
table below are categorised as Level 2 which, as defined by IFRS 7, refers to those items whose fair value measurement is derived
from inputs other than that are observable for the asset or liability either directly or indirectly.
Forward exchange contracts at fair value through profit and loss account
Forward exchange contracts at fair value through hedging reserve
2022
£’000
24
1,625
1,649
2021
£’000
8
749
757
Sensitivity analysis
The group’s principal exposures in relation to market risks are to changes in the euro exchange rate against sterling and to changes
in UK interest rates. The group does not fix the interest rate receivable on its sterling balances, and based on balances held at the
year end, a 1% increase or decrease in sterling interest rates would lead to an increase or decrease in post-tax earnings of
£239,000 (2021: £523,000). The table below details the notional impact of changes in the euro exchange rate against sterling on
the group’s post-tax profit and equity. The gains and losses arise from the translation of receivables, payables, cash and forward
exchange contracts which are denominated in currencies other than each subsidiary’s reporting currency.
Euro 5% stronger against sterling
Euro 5% weaker against sterling
2022
Post-tax profits
£’000
2021
2022
Equity Post-tax profits
£’000
£’000
36
(32)
36
(32)
2
(2)
2021
Equity
£’000
2
(2)
60
Proportion
owned
(%)
100
100
100
100
100
100
100
100
100
100
100
31. Group companies
At 30 June 2022, the trading subsidiaries of the group were:
Name of subsidiary
Activity
Polyflor Limited
Riverside Flooring Limited
Polyflor Australia Pty Limited
Polyflor New Zealand Limited
Polyflor Canada Inc
Polyflor India Pvt Limited
Polyflor (M) SDN BHD
Objectflor Art und Design Belags GmbH
Karndean International GmbH
James Halstead France SAS
Falck Design AB
Flooring manufacturing and distribution
Flooring manufacturing
Flooring distribution
Flooring distribution
Flooring distribution
Flooring distribution
Flooring distribution
Flooring distribution
Flooring distribution
Flooring distribution
Flooring distribution
Country of
incorporation
England
England
Australia
New Zealand
Canada
India
Malaysia
Germany
Germany
France
Sweden
A complete list of the group’s subsidiaries is provided in note 4 of the financial statements of the company.
32. Exchange rates
The currency exchange rates used to translate the results, assets and liabilities of foreign subsidiaries were:
Euro
Australian dollar
New Zealand dollar
Canadian dollar
Swedish krona
Indian rupee
Malaysian ringgit
UAE dirham
2022
Closing
1.16
1.77
1.95
1.57
12.44
95.91
5.35
4.46
2022
Average
1.18
1.83
1.96
1.68
12.18
100.05
5.62
4.89
2021
Closing
1.16
1.84
1.98
1.71
11.81
102.68
5.74
5.07
2021
Average
1.13
1.80
1.94
1.73
11.53
99.11
5.55
4.95
33. Related parties
Transactions between the company and its subsidiaries have been eliminated on consolidation and are not disclosed in this note.
The group’s contributions to the defined benefit pension scheme are disclosed in note 26.
Details of other related party transactions for the group are shown in the directors' report, board report on remuneration and in
the notes to the financial statements. The key management personnel are the directors.
Polyflor Limited, a subsidiary of the company, leases cars from a company of which Mr Russell Whiting is a director. The lease
payments during the year were £41,000 (2021 £81,000) and the maximum outstanding lease commitments at 30 June 2022 were
£128,000 (2021: £18,000).
61
Company Balance Sheet
as at 30 June 2022
Fixed assets
Tangible fixed assets
Investments
Current assets
Debtors due within one year
Debtors due after one year
Retirement benefit obligations
Total debtors
Derivative financial instruments
Cash at bank and in hand
Total current assets
Creditors due within one year
Derivative financial instruments
Net current assets
Total assets less current liabilities
Creditors due after more than one year
Provision for liabilities
Retirement benefit obligations
Net assets
Capital and reserves
Equity share capital
Equity share capital (B shares)
Called up share capital
Share premium account
Capital redemption reserve
Hedging reserve
Profit and loss account
Total shareholders’ funds
Note
3
4
5
5
10
7
8
7
9
6
10
11
2022
£’000
4,291
40,152
44,443
63,042
–
6,144
69,186
2,166
41,171
112,523
(11,063)
(517)
100,943
145,386
(200)
(1,765)
–
143,421
20,837
160
20,997
–
–
1,625
120,799
143,421
2021
£’000
4,363
40,152
44,515
36,148
615
–
36,763
848
69,860
107,471
(11,210)
(92)
96,169
140,684
(200)
–
(4,357)
136,127
10,408
160
10,568
4,122
1,174
749
119,514
136,127
The company has taken advantage of the provisions of Section 408 of the Companies Act 2006 and has elected not to present its
own profit and loss account. The profit after taxation for the financial year dealt with in the financial statements of the company
was £30,797,000 (2021: £43,332,000).
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 30 September 2022.
M Halstead
Director
G R Oliver
Director
James Halstead plc Registration Number 140269
62
Company Statement of Changes in Equity
for the year ended 30 June 2022
Share
capital
£'000
Share
premium
£'000
Capital
redemption
reserve
£'000
Hedging
reserve
£’000
Profit
and loss
account
£’000
Total
shareholders’
funds
£'000
Balance at 30 June 2020
10,567
4,072
1,174
(805)
97,549
112,557
Profit for the year
Remeasurement of the net defined
benefit liability
Fair value movements on
hedging instruments
Total comprehensive income for
the year
Transactions with equity shareholders
Dividends
Issue of share capital
Share based payments
–
–
–
–
–
1
–
–
–
–
–
–
50
–
–
–
–
–
–
–
–
–
–
43,332
43,332
12,708
12,708
1,554
–
1,554
1,554
56,040
57,594
–
–
–
(34,083)
–
8
(34,083)
51
8
Balance at 30 June 2021
10,568
4,122
1,174
749
119,514
136,127
Profit for the year
Remeasurement of the net defined
benefit liability
Fair value movements on
hedging instruments
Total comprehensive income for
the year
Transactions with equity shareholders
Dividends
Issue of share capital
Bonus issue of share capital
Share based payments
Balance at 30 June 2022
–
–
–
–
–
11
10,418
–
20,997
–
–
–
–
–
812
(4,934)
–
–
–
–
–
–
–
–
(1,174)
–
–
–
30,797
30,797
7,090
7,090
876
–
876
876
37,887
38,763
–
–
–
–
(32,298)
–
(4,310)
6
(32,298)
823
–
6
–
1,625
120,799
143,421
63
Notes to the Company Financial Statements
1.
Accounting policies
Basis of preparation
The separate financial statements of the company are presented as required by the Companies Act 2006. The company meets the
definition of a qualifying entity under FRS 100 Application of Financial Reporting Requirements issued by the Financial Reporting
Council. Accordingly, the financial statements have been prepared in accordance with FRS 101 Reduced Disclosure Framework as
issued by the Financial Reporting Council.
The company has used the disclosure exemptions available under FRS 101 in relation to presentation of a cash flow statement,
comparative information for certain assets, capital management, transactions with other group companies, compensation of key
management personnel and the effects of new but not yet effective IFRS.
As the consolidated financial statements include the equivalent disclosures, the company has used the disclosure exemptions
available under FRS 101 in relation to share based payments, and financial instruments. The disclosures for the defined benefit
retirement obligations are included in the consolidated financial statements.
The financial statements are prepared on a going concern basis and in accordance with the historical cost convention, except for
certain financial instruments that have been measured at fair value.
The statement on going concern in the consolidated financial statements also justifies the going concern basis used for the
company financial statements.
The accounting policies of the company are the same as those set out in the consolidated financial statements. The critical
accounting estimates and judgements are income taxes and retirement benefit obligations as set out in the consolidated financial
statements.
The following additional accounting policies are specific to the company’s financial statements.
Investments
Investments in subsidiaries are stated at cost less provision for impairment in value.
Investment land and buildings
Investment land and buildings are stated at cost less depreciation and any provision for impairment. Depreciation is calculated to
write off the buildings on a straight line basis over their estimated economic life of fifty years. No depreciation is charged in respect
of land.
Group debtors
Amounts owed by group undertakings are stated after any provision for expected credit loss in line with the three stage model in
IFRS 9.
2.
Staff costs and numbers
Staff costs comprised:
Wages and salaries
Social security costs
Pension costs
Share based payments
The average monthly number of employees during the year was 22 (2021: 22).
3.
Tangible fixed assets
2022
£’000
3,493
472
98
6
4,069
Cost
At 30 June 2021
Additions
At 30 June 2022
Depreciation
At 30 June 2021
Charge for the year
At 30 June 2022
Net book value
At 30 June 2022
At 30 June 2021
Investment
land and
buildings
£’000
7,978
113
8,091
4,796
158
4,954
3,137
3,182
Freehold
land and
buildings
£’000
1,311
15
1,326
325
25
350
976
986
Plant and
equipment
£’000
581
15
596
386
32
418
178
195
64
2021
£’000
3,105
399
99
8
3,611
Total
£’000
9,870
143
10,013
5,507
215
5,722
4,291
4,363
The investment land and buildings relates to a freehold property that is occupied by a subsidiary company. The rental income was
£600,000 (2021: £600,000).
65
Notes to the Company Financial Statements
continued
4.
Investments
Cost
At 30 June 2021
At 30 June 2022
Provision for impairment
At 30 June 2021
At 30 June 2022
Net book value
At 30 June 2022
At 30 June 2021
Shares in
subsidiary
undertakings
£’000
49,552
49,552
9,400
9,400
40,152
40,152
At 30 June 2022, the company held directly and indirectly 100% of the equity and voting rights of the following undertakings:
Subsidiary
Owned by the company
Polyflor Limited
Riverside Flooring Limited
Titan Leisure Group Limited
Halstead Flooring International Limited
Expona Limited
JHL Limited
Arai (UK) Limited
James Halstead Pension Co Limited
Halstead Floorings Limited
Halstead Flooring Concepts Pty Limited
Polyflor Canada Inc
Polyflor India Pvt Limited
Polyflor (M) SDN BHD
Objectflor Art und Design Belags GmbH
James Halstead France SAS
Falck Design AB
Owned by subsidiaries
Phoenix Distribution (NW) Limited
Polyflor Australia Pty Limited
Colonia Flooring Pty Limited
Polyflor New Zealand Limited
Karndean International GmbH
Polyflor FZE
Activity
Flooring manufacturing and distribution
Flooring manufacturing
Holding company
Dormant company
Dormant company
Dormant company
Dormant company
Dormant company
Dormant company
Holding company
Flooring distribution
Flooring distribution
Flooring distribution
Flooring distribution
Flooring distribution
Flooring distribution
Dormant company
Flooring distribution
Dormant company
Flooring distribution
Flooring distribution
Sales office
Country of
incorporation
Proportion
owned
(%)
England
England
England
England
England
England
England
England
Ireland
Australia
Canada
India
Malaysia
Germany
France
Sweden
England
Australia
Australia
New Zealand
Germany
UAE
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
66
Investments continued
4.
Subsidiary
Polyflor Limited
Riverside Flooring Limited
Titan Leisure Group Limited
Halstead Flooring International Limited
Expona Limited
JHL Limited
Arai (UK) Limited
James Halstead Pension Co Limited
Phoenix Distribution (NW) Limited
Halstead Floorings Limited
Halstead Flooring Concepts Pty Limited
Polyflor Australia Pty Limited
Colonia Flooring Pty Limited
Polyflor Canada Inc
Polyflor India Pty Limited
Polyflor (M) SDN BHD
Objectflor Art und Design Belags GmbH
Karndean International GmbH
James Halstead France SAS
Falck Design AB
Polyflor New Zealand Limited
Polyflor FZE
Registered office
Beechfield
Hollinhurst Road
Radcliffe
Manchester
M26 1JN
England
24/26 City Quay
Dublin 2
D02NY19
Ireland
101 Prosperity Way
Dandenong
VIC 3175
Australia
3209 Orlando Drive
Mississauga
Ontario L4V IC5
Canada
B-408 Knox Plaza
Mindspace, Malad West
Mumbai 400 064
India
802, 8th Floor, Block C
Kelana Square
17 Jalan 557/26
Petaling Jaya
Salangor 47301
Malaysia
Wankelstrasse 50
D 50996 Koln
Germany
Parc Saint Christophe
10 Avenue de l’Enterprise
95861 Cergy Pontoise
France
Box 102 51
434 23 Kungsbacka
Besoksadress
Energigatan 9
Sweden
2 Narek Place
Manukau City
Auckland 2104
New Zealand
Office No LB16112
PO Box 17054
Jafza 16 Building
Jebel Ali Free Zone
Dubai
UAE
67
Notes to the Company Financial Statements
continued
5.
Debtors
Trade debtors
Amounts owed by group undertakings
Corporation tax
Other debtors
Prepayments
Debtors due within one year
Deferred tax assets (note 6)
Debtors due after one year
6.
Deferred tax assets/(liabilities)
At 30 June 2021
Charged to income
Charged to other comprehensive income
At 30 June 2022
2022
£’000
172
62,084
544
86
156
63,042
–
–
Retirement
benefit
obligations
£’000
Accelerated
tax
depreciation
£’000
Other
timing
differences
£’000
828
(349)
(2,015)
(1,536)
(231)
2
–
(229)
18
(18)
–
–
Derivative financial instruments
7.
Derivative financial instruments are forward foreign exchange contracts recognised in the balance sheet at fair value.
8.
Creditors due within one year
Trade creditors
Amounts due to group undertakings
Other taxation and social security
Other creditors
Accruals
2022
£’000
370
6,631
122
427
3,513
2021
£’000
26
35,691
90
86
255
36,148
615
615
Total
£’000
615
(365)
(2,015)
(1,765)
2021
£’000
241
7,367
117
601
2,884
11,063
11,210
9.
Creditors due after more than one year
Preference shares
10. Retirement benefit obligations
Present value of funded obligations
Fair value of scheme assets
Net asset/(liability)
68
2021
£’000
200
2021
£’000
(81,622)
77,265
(4,357)
2022
£’000
200
2022
£’000
(63,092)
69,236
6,144
The company sponsors the Halstead Group Pension Scheme. Disclosure information is provided in note 26 to the consolidated
financial statements.
11. Share capital
Ordinary shares – allotted, issued and fully paid
Opening ordinary shares of 5p each
Ordinary shares of 5p each issued
Ordinary shares of 5p each bonus issue
Closing ordinary shares of 5p each
Ordinary B shares of 1p each
Total allotted, issued and fully paid
2022
Number
2021
Number
208,159,916
212,110
208,372,026
208,141,108
18,808
–
416,744,052
208,159,916
16,042,530
16,042,530
2022
£’000
10,408
11
10,418
20,837
160
2021
£’000
10,407
1
–
10,408
160
20,997
10,568
The ordinary shares of 5p each were issued during the year for a consideration of £823,000 (2021: £51,000).
The issued share capital was increased by a bonus issue of one fully paid ordinary share for each fully paid ordinary share held on
the register at 14 January 2022.
Shareholders approved a proposal for the return of capital (“return of capital”) at an extraordinary general meeting on 6 December
2004. This resulted in the creation of the 1 pence B ordinary shares (“B shares”), which were issued on 14 January 2005. Following
the issue of the B shares, holders received a single dividend of 60 pence per B share. The B shares are not listed, have extremely
limited rights and are of negligible value.
The preference shares detailed below are included as financial instruments within creditors.
Allotted, issued and fully paid
200,000 5.5% preference shares of £1 each
2022
£’000
2021
£’000
200
200
69
Notes to the Company Financial Statements
continued
11. Share capital (continued)
The 5.5% cumulative preference shares of £1 shall confer on the holders thereof the right to receive in priority to all other shares
in the capital of the company out of the profits of the company which it shall be determined to distribute, a fixed cumulative
preferential dividend at the rate of 5.5% per annum on the capital for the time being paid up thereon and the right in the event of
a winding up, in priority to all other shares in the capital of the company, to repayment of the capital paid up thereon together
with a premium of 5p per share and a sum equivalent to any arrears and accruals of the said fixed cumulative preferential dividend
thereon (whether earned or declared or not) calculated up to the date of such repayment of capital but shall not confer any further
right to participate in profits or assets of James Halstead plc.
The company shall not be at liberty to create or issue any further shares ranking in priority to or pari passu with the preference
shares without the consent in writing of the holders of three-fourths of the issued preference shares or the sanction of an
extraordinary resolution of the holders of such preference shares passed at a separate general meeting of such holders. The
preference shares shall not confer upon the holders thereof the right to attend or vote at any general meeting of the company or
to receive notice thereof, unless either:
(i) At the date of the notice convening the meeting the fixed cumulative preferential dividend on the preference shares is six
months in arrears and then so long only as such dividend shall remain unpaid, and so that for this purpose the dividend on the
preference shares shall be deemed to accrue due and be payable by equal half-yearly instalments on 30 June and 31 December in
every year, or
(ii) The business of the meeting includes the consideration of a resolution for reducing the capital or winding up the company or
for the sale of its undertaking or of any resolution directly abrogating or varying any of the special rights or privileges attached to
the preference shares.
The preference shares shall nevertheless entitle the holders thereof to receive notice of every general meeting. At a general
meeting at which the holders of preference shares are entitled to attend and vote, the preference shares shall entitle a holder
thereof, or his proxy, to vote only for every preference share held by him.
12. Related party transactions
The company has taken advantage of the exemption granted by FRS 101 not to disclose transactions and balances with other group
companies.
70
Ten Year Summary (Unaudited)
2013
£’000
2014
£’000
2015
£’000
2016
£’000
2017
£’000
2018
£’000
2019
£’000
2020
£’000
2021
£’000
2022
£’000
Revenue
217,082 223,488 227,261 226,141 240,784 249,510 253,038 238,630 266,362 291,860
Profit before income tax
40,495
41,753
44,184
45,499
46,616
46,702
48,276
43,857
51,268
52,063
Income tax
(10,446) (10,301) (10,250) (10,243) (10,106)
(9,994) (10,484)
(9,502) (11,407) (11,735)
Profit after income tax
30,049
31,452
33,934
35,256
36,510
36,708
37,792
34,355
39,861
40,328
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Basic earnings per 5p share
Dividends per 5p share
7.3p
4.4p
7.6p
5.0p
8.2p
5.5p
8.5p
6.0p
8.8p
6.5p
8.8p
6.8p
9.1p
7.0p
8.3p
7.1p
9.6p
7.6p
9.7p
7.8p
Figures for the previous years have been restated to take account of the one-for-one bonus share issue in the year ended 30 June
2022.
Special dividends are not included.
71
Shareholder Information
Financial calendar
Annual general meeting
Announcement of results
For the half year
For the full year
Dividend payments
Ordinary shares – interim
– final
1 December 2022
March
September
June
December
Preference shares
June and December
Share dealing information
The ordinary shares of the company are traded on the Alternative Investment Market of the London Stock Exchange.
Information concerning the day-to-day movement of the share price can be found on the London Stock Exchange website.
Shareholder analysis
as at 16 September 2022
By size of holding
1-20,000
20,001-100,000
100,001-200,000
200,001-1,000,000
1,000,001 and over
By category
Private individuals
Banks and nominee companies
Other limited companies/corporate bodies
Miscellaneous bodies/pension funds
Investment trusts and funds
Number of
holders
Number of
shares
1,392
431
65
80
52
8,566,346
19,697,283
8,887,594
35,349,844
344,252,985
%
2.1
4.7
2.1
8.5
82.6
2,020
416,754,052
100.0
Number of
holders
Number of
shares
1,709
268
29
9
5
203,466,777
211,324,700
1,463,777
333,966
164,832
%
48.8
50.7
0.4
0.1
0.0
2,020
416,754,052
100.0
72
Notice of Annual General Meeting
NOTICE IS HEREBY GIVEN that the ONE HUNDREDTH and SEVENTH ANNUAL GENERAL MEETING of the company will be
held at Platinum Suite, The University of Bolton Stadium, De Havilland Way, Bolton, BL6 6SF, on 1 December 2022 at 12pm.
Ordinary business
1
To receive and adopt the report of the directors and the statement of accounts for the year ended 30 June 2022
together with the report of the auditors.
2
3
4
5
To declare a final dividend on the ordinary shares in the capital of the company for the year ended 30 June 2022.
To re-elect Mr G R Oliver who is retiring by rotation under the articles of association as a director.
To re-elect Mr S D Hall who is retiring by rotation under the articles of association as a director.
To re-appoint BDO LLP as auditors of the company and authorise the directors to fix their remuneration for the
ensuing year.
Special business
To consider and, if thought fit, pass the following resolutions of which resolutions 6 and 7 shall be proposed as ordinary
resolutions and resolutions 8 and 9 will be proposed as special resolutions:
6
That, subject to the passing of the ordinary and special resolutions numbered 8 and 9 below, the directors be and they
are hereby authorised, pursuant to article 35.14 of the company’s articles of association:
7
8
(i)
(ii)
to exercise the power contained in article 35.14 so that, to the extent determined by the directors, the holders of
ordinary shares be permitted to elect to receive new ordinary shares of 5.0p each in the capital of the company,
credited as fully paid, instead of all or part of any interim or final dividends which shall be declared before the
conclusion of the next annual general meeting of the company after the passing of this resolution; and
to capitalise the appropriate amount of new ordinary shares falling to be allotted pursuant to any elections made
as aforesaid out of profits, or sums standing to the credit of any share premium account or capital reserves of
the company, to apply such sums in paying up such new ordinary shares and to allot such new ordinary shares
to the members of the company making such elections in accordance with their respective entitlements.
That in substitution for all existing and unexercised authorities and powers, the directors of the company be and they
are hereby generally and unconditionally authorised for the purpose of section 551 Companies Act 2006 (the “Act”)
to exercise all or any of the powers of the company to allot shares of the company or to grant rights to subscribe for,
or to convert any security into, shares of the company (such shares and rights being together referred to as “Relevant
Securities”) up to an aggregate nominal value of £6,945,901 to such persons at such times and generally on such
terms and conditions as the directors may determine (subject always to the articles of association of the company)
PROVIDED THAT this authority shall, unless previously renewed, varied or revoked by the company in general meeting,
expire at the conclusion of the next annual general meeting or on the date which is six months after the next
accounting reference date of the company (if earlier) save that the directors of the company may, before the expiry
of such period, make an offer or agreement which would or might require relevant securities or equity securities (as
the case may be) to be allotted after the expiry of such period and the directors of the company may allot relevant
securities or equity securities (as the case may be) in pursuance of such offer or agreement as if the authority
conferred hereby had not expired.
That subject to the passing of the ordinary resolution numbered 8 above the directors be and they are hereby
empowered pursuant to Section 570 of the Companies Act 2006 to allot equity securities (within the meaning of
Section 560 subsection (1) of the said Act) for cash pursuant to the authority conferred by resolution numbered 6
above as if Section 561 of the said Act did not apply to any such allotment provided that this power shall be limited
to:
(i)
(ii)
the allotment of equity securities in connection with an offer of such securities by way of rights to holders of
ordinary shares in proportion (as nearly as may be practical) to their respective holdings of such shares, but
subject to such exclusions or other arrangements as the directors may deem necessary or expedient in relation
to fractional entitlements or any legal or practical problems under the laws of any territory, or the
requirements of any regulatory body or stock exchange; and
the allotment (otherwise than pursuant to sub-paragraph (i) above) of equity securities up to an aggregate
nominal amount of 5% of the ordinary share capital of the company in issue at the date of the passing of this
resolution
73
Notice of Annual General Meeting
continued
and shall expire at the conclusion of the next annual general meeting or on the date which is six months after the next
accounting reference date of the company (if earlier) save that the company may before such expiry make an offer or
agreement which would or might require equity securities to be allotted after such expiry and the directors may allot
equity securities in pursuance of such an offer or agreement as if the power conferred hereby had not expired.
9
That the company is hereby generally and unconditionally authorised for the purposes of section 693 and 701 of the
Companies Act 2006 to make one or more market purchases (within the meaning of section 693(4) of the said Act)
of fully paid ordinary shares of 5 pence each in the capital of the company (“ordinary shares”) provided that:
(i)
(ii)
(iii)
(iv)
(v)
the maximum aggregate number of ordinary shares hereby authorised to be purchased is 10% of the ordinary
shares in issue at the date of passing of this resolution;
the maximum price (exclusive of any expenses) which may be paid for an ordinary share shall not be more
than 5% above the average of the middle market quotations for an ordinary share as derived from the Daily
Official List of The London Stock Exchange plc for the five business days immediately preceding the day on
which the ordinary share is purchased;
the minimum price which may be paid for each ordinary share is 5 pence (exclusive of any expenses);
unless previously revoked or varied, the authority hereby conferred shall expire at the conclusion of the next
annual general meeting of the company or twelve months from the date, if earlier, of passing this resolution;
the company may make a contract or contracts to purchase its ordinary shares under the authority hereby
conferred prior to the expiry of such authority which will or may be executed wholly or partly after the expiry
of such authority and the company may make a purchase of its ordinary shares in pursuance of such contract
as if the authority hereby conferred had not expired; and
(vi)
the directors may elect to hold shares purchased under this authority in the form of treasury shares (subject
to a maximum of 10% of the issued ordinary share capital of the company at any one time).
By order of the board
D N Fletcher
Secretary
14 October 2022
Beechfield
Hollinhurst Road
Radcliffe
Manchester
M26 1JN
Notes
1
At the date of this notice, Covid-19 is still affecting people, although there are no public health restrictions in place. The situation will
be continued to be monitored and the right to attend the meeting will be in accordance with the UK Government's guidance in force
at the time.
Preference shareholders are advised that they are not entitled to attend or vote at the annual general meeting.
2
3
You can vote either:
i.
By logging on to www.signalshares.com and following the instructions. If you experience difficulties in logging in or require
assistance, please contact Link Group directly on Tel: 0371 664 0300 (Calls are charged at the standard geographic rate and will
vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. Lines are open between
09:00 – 17:30, Monday to Friday excluding public holidays in England and Wales).
By appointing 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 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. Please
consider appointing the Chairman of the AGM as your proxy, with voting instructions, to ensure your vote is counted. You may
request a form of proxy directly from the registrars, Link Group using the telephone number above (same call terms and
conditions apply). In order for a proxy appointment to be valid a form of proxy must be completed. In each case the form of proxy
must be received by Link Group, Central Square, 29 Wellington Street, Leeds, LS1 4DL by 12pm on 29 November 2022.
By attending the meeting in person at the address and time set out at the beginning of this notice, bringing either your
attendance card or other appropriate form of identification so that you can be identified by the company’s registrars. It is
recommended that you arrive at least 15 minutes before the time appointed for the meeting to begin. To be entitled to attend
and vote at the meeting (and for the purpose of the determination by the company of the votes they may cast), shareholders
must be entered in the register of members of the company at close of business on 29 November 2022.
In the case of CREST members, by utilising the CREST electronic proxy appointment service in accordance with the procedures
set out below.
ii
iii
iv.
74
4
5
6
7
8
9
10
11
If you return more than one proxy appointment, either by paper or electronic communication, the appointment received last by the
Registrar before the latest time for the receipt of proxies will take precedence. You are advised to read the terms and conditions of use
carefully. Electronic communication facilities are open to all shareholders and those who use them will not be disadvantaged
CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so for the
Meeting (and any adjournment of the Meeting) by using the procedures described in the CREST Manual (available from
www.euroclear.com/site/public/EUI). CREST Personal Members or other CREST sponsored members, and those CREST members who
have appointed a service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the
appropriate action on their behalf. In order for a proxy appointment or instruction made by means of CREST to be valid, the appropriate
CREST message (a ‘CREST Proxy Instruction’) must be properly authenticated in accordance with Euroclear UK & Ireland Limited’s
specifications and must contain the information required for such instructions, as described in the CREST Manual. The message must
be transmitted so as to be received by the issuer’s agent (ID RA10) by 12pm on 29 November 2022. For this purpose, the time of receipt
will be taken to mean the time (as determined by the timestamp applied to the message by the CREST application host) from which
the issuer’s agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time, any change
of instructions to proxies appointed through CREST should be communicated to the appointee through other means.
CREST members and, where applicable, their CREST sponsors or voting service providers should note that Euroclear UK & Ireland Limited
does not make available special procedures in CREST for any particular message. Normal system timings and limitations will, therefore,
apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the
CREST member is a CREST personal member, or sponsored member, or has appointed a voting service provider(s), to procure that their
CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means
of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting
system providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system
and timings. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the
Uncertificated Securities Regulations 2001.
Any corporation which is a shareholder can appoint one or more corporate representatives who may exercise on its behalf all of its
powers as a shareholder provided that no more than one corporate representative exercises powers in relation to the same shares.
As at 29 September 2022 (being the latest practicable business day prior to the publication of this Notice), the company’s ordinary
issued share capital consisted of 416,754,052 ordinary shares, carrying one vote each. Therefore, the total voting rights in the company
as at 29 September 2022 were 416,754,052.
You may not use any electronic address (within the meaning of Section 333(4) of the Companies Act 2006) provided in either this
Notice or any related documents (including the form of proxy) to communicate with the company for any purposes other than those
expressly stated.
A copy of this Notice, and other information required by Section 311A of the Companies Act 2006, can be found on the company’s
website at www.jameshalstead.com.
The documents listed below will be available for inspection at an agreed time at the registered office of the company during the usual
business hours on any weekday except bank holidays. Please e-mail secretary@jameshalstead.plc.uk (Label your e-mail “AGM
documents”) to book an appointment to view the following documents:
i.
ii.
The register of interests of the directors in the share capital of the company: and
Copy of the service contract of Mr G R Oliver.
12
The final dividend, if approved, will be paid on 16 December 2022 to shareholders on the register as at 18 November 2022.
75
Report & Accounts 2022
J
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2
2
Expona Commercial
Polysafe Wood fx
Beechfield
Hollinhurst Road
Radcliffe
Manchester
M26 1JN
Tel +44 (0)161 767 2500
Fax +44 (0)161 766 7499
www.jameshalstead.com
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