Judges Scientific plc
ANNUAL REPORT & ACCOUNTS 2014
CONTENTS
£’000
10 year financial history ...........................................................................................................1
Consolidated financial statements
Chairman’s statement .......................................................................................................2 – 3
Strategic report .....................................................................................................................4 – 5
Directors’ report .................................................................................................................6 – 8
Independent auditor’s report ................................................................................................9
Consolidated statement of comprehensive income ............................................10
Consolidated balance sheet .................................................................................................11
Consolidated statement of changes in equity .........................................................12
Consolidated cash flow statement .................................................................................13
Notes to the consolidated financial statements ........................................14 – 32
Parent company financial statements
Independent auditor’s report .............................................................................................34
Parent company balance sheet ..........................................................................................35
Notes to the parent company financial statements ................................36 – 39
£’000
Company meeting
Notice of Annual General Meeting ....................................................................40 – 41
Form of Proxy for the Annual General Meeting .......................................43 – 44
Front Page:
The Armfield BE4 Anaerobic Tank
Reactor
The Armfield BE4 Anaerobic Tank Reactor
is a self-contained, small scale reactor
offering a diverse range of reaction
options, all presented in such a way that
the process is transparent and easily
followed. Anaerobic digestion is a process
by which micro organisms break down
organic matter into simpler chemical
components without oxygen. This process
can be very useful to treat organic waste.
Legislation on climate change and
renewable obligations has greatly increased
the interest and research in this area.
10 YEAR FINANCIAL HISTORY
Revenue and adjusted operating profit
s
s
s
s
s
s
s
s
s
s
Dec 2005
Dec 2006
Dec 2007
Dec 2008
Dec 2009
Dec 2010
Dec 2011
Dec 2012
Dec 2013
Dec 2014
Revenue Adjusted operating profit Adjusted operating profit as a percentage of revenue
s
Earnings, dividends and share price
Dec 2005
Dec 2006
Dec 2007
Dec 2008
Dec 2009
Dec 2010
Dec 2011
Dec 2012
Dec 2013
Dec 2014
Dividend per share Adjusted basic earnings per share Share price in pence
Annual debt repaid and dividends paid from cashflow
Dec 2005
Dec 2006
Dec 2007
Dec 2008
Dec 2009
Dec 2010
Dec 2011
Dec 2012
Dec 2013
Dec 2014
Dividends Repayment of borrowings
£’000
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
-
e
c
n
e
p
n
i
e
r
a
h
s
r
e
p
i
s
g
n
n
r
a
E
/
d
n
e
d
i
v
D
£’000
120
100
80
60
40
20
-
4.500
4.000
3.500
3.000
2.500
2.000
1.500
1.000
0.500
-
25%
20%
15%
10%
5%
0%
2,550
2,050
1,550
1,050
550
50
e
c
n
e
p
n
i
e
c
i
r
p
e
r
a
h
S
1
CHAIRMAN’S STATEMENT
The last year was undoubtedly challenging
for Judges. The scientific instrumentation
sector had generally experienced patchy
demand in the past two to three years and
this finally affected most of the group in the
course of 2014. For the ninth consecutive
year, sales reached a record £40.6 million
(2013: £36.0 million) but adjusted pre-tax
profits and adjusted earnings per share
declined. Despite this, cash generation was
strong and the group’s ability to increase
the dividend and pursue acquisitions remains
very much intact.
Trading in 2014
Group revenues for the financial year
ended 31 December 2014 advanced from
£36.0 million to £40.6 million. This reflects
an organic contraction of 3.0% offset by
a full year’s contribution from Scientifica
Limited (“Scientifica”) compared to six
months in 2013. For the year as a whole and
excluding Scientifica, revenues decreased
5.3% in continental Europe, encompassing a
particularly weak performance in Germany
(down 41.1%) partially offset by a 29.4%
increase in France. Turnover declined 8.8%
in the USA but registered a 55.9% increase
in Canada. Elsewhere, revenues were 21.5%
lower in China, stable in the UK and buoyant
in Australasia and the rest of the world.
In part we believe this picture reflects a
general reduction in levels of government
funded scientific capital expenditure as a
consequence of austerity programmes in
many advanced economies. It is difficult
to predict when the climate will improve
substantially but we believe the need to
advance scientific research capabilities
remains an imperative for both developed
and emerging economies.
Profit before tax, exceptional items and
non-controlling interests declined by 11.8%
to £6.5 million (2013: £7.3 million), with
the operating contribution of the businesses
owned as at 1 January 2014 (i.e. excluding
Scientifica) down 20.6%. The operating
subsidiaries (including Scientifica) produced
a Return on Total Invested Capital of 24.0%
(2013: 30.2%).
Basic earnings per share before exceptional
items declined by 17.7% from 100.5p to
82.7p. The contraction in earnings per share
reflected lower profits and the dilution
created by the full-year effects of the
October 2013 share placing. Fully diluted
earnings per share before exceptional items
decreased 16.5% to 80.5p (2013: 96.4p).
Exceptional items include the amortisation
of intangible assets, tax relief arising from
the issue of shares to employees and other
non-trading items, as set out in the income
statement. Profit, including exceptional items
but before tax and non-controlling interests,
amounted to £2.4 million (2013: £1.2 million).
Including exceptional items, basic earnings
per share amounted to 35.7p (2013: 23.4p)
while fully diluted earnings per share totalled
34.7p (2013: 22.5p).
Mirroring widespread experience in the
scientific instruments sector at various times
in recent years, the group suffered weak
order intake in most of its businesses during
the first three quarters of the financial year.
During the first half, the group managed
to mitigate the impact on the income
statement of this slowdown in orders but at
the expense of a first-half reduction in the
order book from 10.5 weeks to 7.8 weeks.
This progressively affected the trading
performance of the group’s operations.
Order intake recovered in the last quarter,
thereby restoring the order book to 9.9
weeks of budgeted sales.
Your Board attributes the difficult
trading environment to risk factors it
has consistently highlighted in the past:
the aforementioned restrictions in public
spending in many advanced economies, a
slowdown in China and, especially in the first
half of the year, the strength of Sterling.
Judges Chairman, Alex Hambro
2
Your Board’s thanks go to all our employees
and stakeholders for their important
contributions during the year.
Current trading and prospects
After experiencing an excellent order inflow
during the last quarter of 2014, bookings for
the first eleven weeks of 2015 reverted to a
similar level to those for the corresponding
period in 2014. It is, of course, too early to
draw conclusions for the year as a whole,
other than to recognise that demand
supported by public sector funding remains
patchy. On the currency front, the recent
strength of the US dollar may well result
in a gradual improvement in orders and
margins from outside Europe; although
the group’s activities in continental Europe
could struggle, given the recent weakness of
the Euro. The group started the year with
a restored order book, an exciting new
acquisition and a solid financial position, and
is therefore well equipped to weather any
further headwinds should they materialise.
Alex Hambro
Chairman
26 March 2015
Financial position
Cash-flow was strong during 2014.
Cash generated from operations amounted
to £7.5 million (2013: £5.0 million) and
adjusted net debt as at 31 December 2014,
excluding subordinated debt owed to non-
controlling shareholders, reduced to just
£1.3 million (2013: £5.2 million). Year-end
cash balances progressed from £10.1 million
to £11.1 million.
In December 2014, the group’s various
bank loans (excluding those extended to
Bordeaux Acquisition) were consolidated
into one five-year term loan. In addition,
the bank granted the company a £10 million
revolving acquisition facility; this will facilitate
the acquisition process and avoid the need
for the company to hold large amounts of
unproductive cash. I would like to place
on record the Board’s appreciation of the
continued backing that the Group receives
from its bankers, Lloyds Bank Corporate
Markets, in support of its expansion strategy.
Dividends
Your Board is pleased to recommend a
final dividend of 14.7p per share
(2013: 13.4p per share) which, subject to
approval at the forthcoming Annual General
Meeting on 27 May 2015, will make a total
distribution of 22p per share in respect of
2014 (2013: 20p per share). Despite the
proposed increase, the dividend total is
still covered almost four times by adjusted
earnings per share.
The proposed final dividend will be payable
on 10 July 2015 to shareholders on the
register on 12 June 2015 and the shares will
go ex-dividend on 11 June 2015.
Post Balance sheet events
On 22 January 2015, the company acquired
Armfield Limited (“Armfield”), a company
involved in the production and marketing
of engineering equipment and research
instruments for educational applications
and R&D systems focused on the food,
beverage, dairy, vegetable oils and
pharmaceutical industries. The purchase
consideration included an £8.3 million
cash payment and a potential £1.5 million
earn-out - 50% in cash and 50% in shares
at a price of 2055p per share - based on
Armfield’s 2014 profitability. It is expected
that this earn-out will be paid in full.
Armfield’s adjusted EBIT for the calendar
year 2013 amounted to £1.66 million. The
acquisition was financed from the company’s
cash resources and £4.0 million drawn from
the new acquisition facility.
After ten years of service, Ralph Cohen, the
group’s finance director, will retire from his
executive position at the end of April. This
is a cause of sadness for his colleagues and,
I am sure, for the company’s shareholders
and other stakeholders. His contribution to
Judges Scientific has been immense during
this critical period which has seen the
group’s market capitalisation develop from
£4 million to £100 million. I am pleased that
we will continue to enjoy his insight and
delightful personality, hopefully for many
years, as a non-executive director. He will
be succeeded as group finance director
by Brad Ormsby who joined the Board
on 3 March 2015 after a successful career
encompassing PwC, Eurovestech plc and
several of its investee companies including
Kalibrate Technologies plc where, as CFO,
he was actively involved in the company’s
successful IPO.
Our team
Our employees have continued to uphold
your company’s culture of autonomous
hard work and engineering excellence during
a difficult year. The marketing and sales
teams have had to work particularly hard
to win business but we believe that these
efforts will reward the group handsomely
when the trading environment returns to a
more predictable footing.
3
STRATEGIC REPORT
Inevitably, when a material acquisition is made, the overall group
ROTIC is diluted, given the profit multiples that such businesses
command. The out-turn for 2014, at 24% as compared with 30% in
2013, reflected both the full-year effect of the acquisition of Scientifica
in June 2013 and the difficult trading environment in 2014.
• Acquisitions: while there were no acquisitions in 2014
significant efforts were expended during the year in the
furtherance of our strategy, culminating in the completion of the
purchase on 22 January 2015 of the entire issued share capital
of Armfield, a company which designs and markets engineering
equipment and research instruments for educational applications,
together with research and development systems focused on the
food, beverage, dairy, vegetable oils and pharmaceutical industries.
Further details of this transaction are set out in note 32. It is
regarded as paramount that acquisitions are completed only when
the directors are satisfied that the target business has sound long-
term strength.
• Ongoing performance: the directors regard the trend of
earnings per share (excluding exceptional items), reduction
in net debt and the company’s ability to pay dividends to its
shareholders as key indicators of its performance against the
overall group strategy. It is a source of great disappointment
to the directors that earnings per share fell in 2014 (for the
first time since the company entered the scientific instruments
business in 2005) to 82.7p in 2014 from 100.5p in 2013, both
figures undiluted and excluding exceptional items. On the other
hand, cash generation remained strong, with net debt reducing
by some £3.9 million, despite the payment of an increased
dividend and a £0.5 million cash earn-out in respect of the
Scientifica acquisition. The directors consider that there is still
clear scope to increase dividend payments, while still remaining
within prudent parameters; the Board will recommend a total
distribution in respect of 2014 amounting to 22.0p (including
the 7.3p that has already been paid at the interim stage), a 10%
increase on the payment in respect of 2013. This is covered
3.8 times by adjusted earnings, without taking account of the
earnings enhancement that is expected to accrue from the
Armfield acquisition.
• Revenue trends
• The Materials Sciences group: revenues declined by 2% in
comparison with 2013.
• The Vacuum group: revenues rose by 23%, driven by
the inclusion for the first time of a full year’s trading from
Scientifica, acquired in June 2013. However, excluding
Scientifica, revenues declined by 4% in the year.
Profitability
The group’s operating profit margin (excluding exceptional items)
fell from 21.7% in 2013 to 17.3% in 2014. Margins were impacted
by weaker sales against a largely fixed cost base and by adverse
currency movements.
Group activities and strategy
The company is the parent of a trading group involved in the design
and manufacture of scientific instruments. Since its entry into this field
of activity in 2005, the company’s strategy has been to develop its
business through a “buy-and-build” programme of acquisitions.
This has seen the purchase of businesses which meet exacting
performance criteria, including a successful product range, an
international customer profile and sustainable sales, profits and cash
generation. Companies are acquired only when sensible terms can be
negotiated with vendors. Debt financing is used to the extent that it
is available and remains within prudent parameters and the group’s
primary focus is to enrich shareholders through the repayment of debt.
Business review
After eight years of unbroken growth in revenues and profits, 2014
proved a more challenging year. Headline revenues continued to
advance, reflecting the first full year of ownership of Scientifica
Limited (2013: six months). However, the underlying sales trend was
one of modest decline, with revenues on a like-for-like basis falling by
3%. This reflected the economic difficulties that have affected large
segments of the global economy as governments in many parts of the
developed world continue to struggle to bring public sector debt and
spending under control. Inevitably, this weakness in activity resulted
in a decline in profits for the year, with earnings per share (undiluted,
before exceptional items) reducing by 18% from 100.5p to 82.7p.
Despite these trading headwinds during 2014, the group’s
fundamental business strategy remains intact, namely to acquire
solid businesses in our chosen sector, utilising strong cash flows
to pay down the resulting debt as quickly as possible. The securing
of an enhanced Bank facility in December 2014, aimed principally
at acquisition financing, and the acquisition of Armfield Limited
(“Armfield”) in January 2015 are testament to the enduring strength
of this strategy.
A significant proportion of group output is sold to customers
financed directly or indirectly by the public sector, albeit in a
diversified portfolio of regions and countries. Movements in exchange
rates influence international competitiveness and trading margins.
Sterling strengthened steadily through 2014 against the Euro but
remained volatile against the US dollar, rising strongly in the first
half of the year but falling back in the second. In consequence, the
directors considered it prudent to maintain the group’s hedging
strategies, covering both existing exposure on a day-to-day
basis throughout the year and affording some protection against
prospective trading risks into 2015.
The company’s business strategy calls for a steady increase in the
scope of its operations, achieved both through acquisitions of
companies operating in its chosen field of activity and through the
ongoing performance of its established subsidiaries. In addition to
the dilution of head office costs that results from acquisitions, the
company closely monitors the return it derives on the capital invested
in its subsidiaries. The annual rate of return on total invested capital
(“ROTIC”) is computed monthly by comparing attributable earnings
excluding exceptional items and before interest, tax and amortisation
(“EBITA”) with the investment in property, plant and equipment,
goodwill and other intangibles and net current assets (excluding cash).
4
Cash generation and management
Cash generated from operations amounted to £7.47 million
(2013: £5.01 million), slightly in excess of the year’s earnings before
interest, tax, depreciation and amortisation. The year saw a sharp
reduction in capital expenditure following the completion in 2013
of the construction of the new “Stonecross” factory in East Sussex.
The overall effect was to reduce adjusted net debt by £3.9 million
during the year to a year-end balance of £1.8 million (or £1.3 million
if subordinated loans from minority shareholders in group subsidiaries
are excluded).
In December 2014, the directors agreed a new financing arrangement
with its bankers, Lloyds Bank Corporate Markets. The new
agreement saw the consolidation of all existing term loans (with
the exception of those advanced to the 51%-owned subsidiary,
Bordeaux Acquisition Limited) into a single new five year term loan;
additionally, the group entered into a new £10.0 million revolving
acquisition facility, which was put in place to simplify the acquisition
funding process both for “permitted acquisitions”, which fall within
set criteria, and for larger transactions where the consent process
was streamlined. These new arrangements, coupled with the strong
cash generation profile of the underlying businesses, give the group
substantial financial strength in the context of the size of the group’s
earnings and balance sheet.
Commercial risks and uncertainties
The group’s customers are located in all parts of the globe and a
major part of sales is to enterprises that are state-owned or closely
tied to state spending. Accordingly, the prevailing uncertainties in the
world economy, and particularly the borrowing constraints currently
affecting many western nations, represent a risk to the group’s
prospects. In addition, the group’s exporting subsidiaries are exposed
to possible adverse impacts on the international competitiveness of
their activities caused by fluctuations in exchange rates. The group
seeks, so far as is practicable, to mitigate these currency effects, as
set out in note 29.
An important element of the group’s business strategy is
development through acquisition; the group is exposed to the risk
of an insufficient availability of target companies of requisite quality
and to the risk that an acquired company does not meet its expected
profitability. The group manages this risk by maintaining relationships
with organisations that market appropriate targets and by performing
detailed research into potential acquisitions.
Across all the group’s activities lies the exposure to human resource
shortages. This reflects the small niche-serving nature of the
group’s businesses and the impracticality at this stage of the group’s
development of providing significant back-up support in respect of
key roles.
The principal drivers of the individual segments within the group,
together with their key commercial risks and uncertainties, are
as follows:
• The Materials Sciences group supplies measurement equipment
across both public and private sectors. The principal risks
relate to the degree of funding available to public-sector
customers. Sales to the private sector into industries with a
history of cyclicality are at risk of periodic downturns in
activity. Overall, the long-term growth of the business is
supported by the development of safety regulations internationally
and by the globalisation of trade, as well as by maintaining a
strong global presence;
•
The Vacuum group designs and manufactures instruments to aid
the examination of samples in optical and electron microscopes
and to create motion, heating and cooling within ultra high
vacuum chambers. Over the years it has benefited from buoyancy
of the high-tech markets which it serves, though the directors
consider that there is scope to improve the division’s output and
market share through technical innovation. In consequence, the
division is engaged in a high level of development work, with the
attendant risk of technical failure or delays. The directors seek
to mitigate this risk through the quality of the division’s technical
skills base and through its contractual arrangements with its
customers. The degree of funding available to its public-sector
customer base also represents a risk.
Capital management objectives
The group monitors capital on the basis of the carrying amount of
equity, less cash and cash equivalents as presented on the face of the
balance sheet. The directors manage the capital structure and make
adjustments to it in the light of changes in economic conditions and
the risk characteristics of the underlying assets. In order to maintain
its capital structure the group may adjust the amount of dividends
paid to shareholders, issue new shares or sell assets to reduce debt.
The directors seek to maintain a conservative gearing position
(7% at 31 December 2014, 2013: 27%), through utilising bank
funding to support their acquisition strategy to the maximum degree
prudently possible. The new financing arrangements described above
(under the heading of cash generation and management) will enable
the group to manage its capital resources and acquisition financing
requirements in a more efficient and flexible manner.
The directors’ capital management strategy is to ensure the group’s
ability to continue as a going concern and to provide an adequate
return to shareholders. The parent and subsidiary companies’
boards meet regularly to review performance and discuss future
opportunities and threats with the aim of optimising sustainable
returns and minimising risk.
On behalf of the board
David Cicurel
Director
Judges Scientific plc
Company registration number: 4597315
26 March 2015
5
DIRECTORS’ REPORT
2. Liquidity risk
The group seeks to manage liquidity risk by ensuring that
sufficient funds are available to meet foreseeable needs and to
invest cash assets safely and profitably. Primarily this is achieved
through loans arranged at group level. Short term flexibility is
achieved through the significant cash balances that the group
currently holds.
3. Credit risk
The group reviews the credit risk relating to its customers by
ensuring, wherever possible, that it deals with long established
trading partners, agents and government / university backed
bodies, where the risk of default is considered low. Where
considered appropriate, the group insists on up-front payment
and requires letters of credit to be provided.
4. Currency risk
With exports representing a significant proportion of its sales,
the main risk area to which the group is exposed is that of
foreign currencies (principally US$ and Euros). The group adopts
a strategy to hedge against this risk by entering into currency
options/forward exchange contracts and/or by maintaining
a proportion of its bank loans in these currencies, although
this does not represent a hedge under IAS 39. The directors
review the value of this economic hedge on a regular basis.
There remains, nevertheless, an ongoing threat to the group’s
competitive position in international markets from any sustained
period of Sterling strength. Forward and option contracts are
entered into in both US$ and Euros maturing in the subsequent
year, aimed at protecting the ensuing year’s competitive position
and margins from adverse currency movements.
5. Price risk
The conversion terms of the Convertible Redeemable shares gave
rise to a derivative financial instrument, which was affected by
fluctuations in the company’s Ordinary share price. As described
in note 25, the Convertible Redeemable shares were fully
converted or redeemed prior to 31 December 2014.
6. Cash flow risk
The group manages its cash flow through a mixture of working
capital, bank borrowings, equity and retained profits. With
adjusted net debt at 31 December 2014 of just £1.3 million
(excluding loans from non-controlling interests) and cash and
cash equivalents of £11.1 million, the group’s cash position is
considered to be one of its key strengths.
The directors present their report and financial statements for the
year ended 31 December 2014.
Results and dividends
The results for the financial year to 31 December 2014 are set out in
the Consolidated Statement of Comprehensive Income. The company
paid an interim dividend of 7.3p per Ordinary share on 7 November
2014. At the forthcoming Annual General Meeting, the directors will
recommend payment of a final dividend for the year of 14.7p per
Ordinary share to be paid on Friday 10 July 2015 to shareholders on
the register on Friday 12 June 2015. The shares will go ex-dividend
on Thursday 11 June 2015.
Going concern
The consolidated financial statements have been prepared on a
going concern basis. The directors have taken note of guidance
issued by the Financial Reporting Council on Going Concern
Assessments in determining that this is the appropriate basis of
preparation of the financial statements. The group’s principal
operating companies experienced a difficult trading environment
in 2014 but cash generation was strong, net debt has fallen to just
7% of equity attributable to equity holders of the parent company
and overall the group went into 2015 with a much improved order
book compared to the mid-point of the year. Although the global
economic environment remains uncertain, the directors consider that
the parent company and the group are well placed to manage their
business risks successfully.
The directors have a reasonable expectation that the parent
company and the group have adequate resources to continue in
operational existence for the foreseeable future. Accordingly, they
continue to adopt the going concern basis in preparing the annual
report and accounts.
Financial risk management objectives and policies
The group utilises financial instruments (see note 28), comprising
borrowings, cash and cash equivalents and various other items
such as trade receivables and payables that arise directly from its
operations. The main purpose of these financial instruments is to
raise finance for the group’s operations. The main risks arising from
the group’s financial instruments relate to interest rates, liquidity,
credit and foreign currency exposure. The directors review and
agree policies for managing each of these risks, which are described
and evaluated in more detail in note 29 and which are summarised
below. Except as stated, the policies have remained unchanged from
previous years.
1. Interest rate risk
The group finances its operations through a mixture of bank
borrowings, equity and retained profits. With adjusted net debt
of just £1.3 million at 31 December 2014 (excluding £497,000
of subordinated loans which do not bear interest), exposure to
interest rate fluctuations is not considered to be a major threat
to the group; however, the group’s loans are subject to interest
rate hedges, as described in note 29.
6
Directors
The following directors have held office during the year:
Hon AR Hambro1 - non-executive
Mr DE Cicurel
Mr D Barnbrook
Mr RL Cohen
Mr RJ Elman1 - non-executive
Mr GC Reece1 - non-executive
Details of share options and Share Incentive Plan purchases by
directors are set out in note 24.
In addition to the above holdings of Ordinary shares, the following
director had interests in the Convertible Redeemable share capital of
the company:
Convertible Redeemable of 1p each (quarter-paid)
31 December 2014
1 January 2014
Shares
-
Shares
208,333
Mr B Ormsby was appointed a director on 3 March 2015
1 Member of the audit and remuneration committees
Mr RJ Elman
The conversion of the Convertible Redeemable shares and
movements in the year are detailed in note 25. During 2014
Mr Elman’s SIPP converted its remaining holding of Convertible
Redeemable shares as disclosed in note 24. There were no
conversions or redemptions in 2013.
Directors’ interests
The directors’ interests in the Ordinary shares of the company were
as stated below:
Ordinary of 5p each
31 December 2014 1 January 2014
Shares
Options
Shares
Options
Hon AR Hambro
92,500
-
92,500
-
Mr DE Cicurel
916,520
1,775
916,389
1,775
Mr D Barnbrook
22,491
28,325
22,381
28,325
Mr RL Cohen
Mr RJ Elman
Mr GC Reece
58,039
7,875
50,907
44,875
62,398
-
-
-
32,429
-
-
-
Dividends paid in the year to directors who hold shares amounted to
£234,000 in aggregate (2013: £196,000).
Directors’ remuneration
The remuneration paid to or receivable by each person who served as a director during the year was as follows:
Base
salary/fees
Performance
related bonus
Contribution
to pension
schemes
Benefits
£000
£000
£000
£000
33
23
38
158
127
137
516
-
-
-
-
-
-
-
-
-
-
-
6
-
6
-
-
-
4
15
5
24
2014
Total
£000
33
23
38
162
148
142
546
Non Executive Directors
Hon AR Hambro
Mr RJ Elman
Mr GC Reece
Executive Directors
Mr DE Cicurel
Mr D Barnbrook
Mr RL Cohen
Total
During 2014 one director exercised share options as disclosed under note 24 (2013: one director).
2013
Total
£000
30
20
37
184
166
161
598
7
Corporate governance
Being AIM listed, the company is not required to and does not fully
comply with the UK Corporate Governance Code. However, drawing
upon best practice, the directors have established an audit committee
and a remuneration committee with formally delegated duties and
responsibilities. The members of both committees are the non-
executive directors.
The audit committee determines the terms of engagement of the
company’s auditor and, in consultation with the company’s auditor,
the scope of the audit. The audit committee has unrestricted access
to the company’s auditor. The remuneration committee has delegated
authority to determine the scale and structure of the executive
directors’ remuneration and the terms of their service contracts.
The remuneration of the non-executive directors is determined by the
board as a whole.
Payment policy
The group’s policy is to agree terms and conditions with suppliers
before business takes place and to pay agreed invoices in accordance
with the terms of payment. Trade creditor days of the company at the
end of the year represented 7 days (2013: 16 days).
Auditor
Grant Thornton UK LLP have expressed willingness to continue in
office. In accordance with section 489(4) of the Companies Act 2006,
a resolution to reappoint Grant Thornton UK LLP will be proposed at
the Annual General Meeting.
On behalf of the board
Ralph Cohen
Director and Company Secretary
Judges Scientific plc
Company registration number: 4597315
26 March 2015
Directors’ responsibilities
The directors are responsible for preparing the Annual Report and the
financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements
for each financial year. Under that law the directors have elected to
prepare the parent company financial statements in accordance with
United Kingdom Accounting Standards (United Kingdom Generally
Accepted Accounting Practice) and the consolidated financial
statements in accordance with International Financial Reporting
Standards as adopted by the European Union (IFRSs). 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 and of the profit or loss of the company and the group for
that period.
In preparing these financial statements, the directors are required to:
•
•
•
•
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and
prudent;
state whether applicable UK Accounting Standards or IFRSs have
been followed, 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 company will continue in
business.
The directors are responsible for keeping adequate accounting records
that are sufficient to show and explain the company’s transactions and
disclose with reasonable accuracy at any time the financial position
of the company and the group and enable them to ensure that the
financial statements comply with the Companies Act 2006. They are
also responsible for safeguarding the assets of the company and group
and hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
The directors confirm that:
•
•
so far as each director is aware, there is no relevant audit
information of which the company’s auditor is unaware; and
the directors have taken all the steps that they ought to have
taken as directors in order to make themselves aware of any
relevant audit information and to establish that the auditor is
aware of that information.
The directors are responsible for the maintenance and integrity of the
corporate and financial information included on the company’s website.
Information published on the website is accessible in many countries
and legislation in the United Kingdom governing the preparation and
dissemination of financial statements may differ from legislation in
other jurisdictions.
8
INDEPENDENT AUDITOR’S REPORT
Matters on which we are required to report by exception
We have nothing to report in respect of the following:
Under the Companies Act 2006 we are required to report to you if,
in our opinion:
•
•
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.
Other matter
We have reported separately on the parent company
financial statements of Judges Scientific plc for the year ended
31 December 2014.
Philip Sayers
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
East Midlands
26 March 2015
We have audited the consolidated financial statements of Judges
Scientific plc for the year ended 31 December 2014 which comprise
the consolidated statement of comprehensive income, the consolidated
balance sheet, the consolidated statement of changes in equity, the
consolidated cash flow statement and notes 1 to 32. The financial
reporting framework that has been applied in their preparation is
applicable law and International Financial Reporting Standards (IFRSs)
as adopted by the European Union.
This report is made solely to the company’s members, as a body, in
accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
company’s members those matters we are required to state to them
in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone
other than the company and the company’s members as a body, for
our audit work, for this report, or for the opinions we have formed.
Respective responsibilities of directors and auditor
As explained more fully in the statement of directors’ responsibilities,
the directors are responsible for the preparation of the consolidated
financial statements and for being satisfied that they give a true and
fair view. Our responsibility is to audit and express an opinion on the
consolidated financial statements in accordance with applicable law and
International Standards on Auditing (UK and Ireland). Those standards
require us to comply with the Auditing Practices Board’s (APB’s)
Ethical Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is
provided on the Financial Reporting Council’s website at
www.frc.org.uk/auditscopeukprivate
Opinion on financial statements
In our opinion the consolidated financial statements:
•
•
•
give a true and fair view of the state of the group’s affairs as at
31 December 2014 and of its profit for the year then ended;
have been properly prepared in accordance with IFRS as adopted
by the European Union; and
have been prepared in accordance with the requirements of the
Companies Act 2006
Opinion on other matter prescribed by the Companies
Act 2006
In our opinion the information given in the Strategic Report and
Directors’ Report for the financial year for which the consolidated
financial statements are prepared is consistent with the consolidated
financial statements.
9
CONSOLIDATED STATEMENT
OF COMPREHENSIVE INCOME
Revenue
Operating costs excluding exceptional items
Operating profit excluding exceptional items
Exceptional items
Amortisation of intangible assets
Contingent consideration measured at fair value
Financial instruments measured at fair value
Convertible Redeemable shares
Hedging contracts
Relocation costs
Acquisition costs
Operating profit/(loss)
Interest receivable
Interest payable
Profit/(loss) before tax
Taxation
Note
Before)
exceptional)
items)
£000)
Exceptional)
items)
2014)
Total)
£000)
£000)
Before)
exceptional)
items)
£000)
Exceptional)
items)
2013)
Total)
£000)
£000)
7
8
16
31
25
8
8
8
10
10
40,568)
(33,555)
7,013)
-)
-)
-)
40,568)
36,041)
(33,555)
(28,228)
7,013)
7,813)
-)
-)
-)
36,041)
(28,228)
7,813)
-)
-)
-)
-) 4
-)
-)
(4,251)
(16)
)
185)
) 4
-) -
-) -
(4,251)
(16)
185)
)
)
)
-)
-)
-)
-)
-)
-)
(4,498)
(317)
(4,498)
(317)
(340)
24)
(158)
(794)
(340)
24)
(158)
(794)
7,013)
(4,078)
2,935)
7,813)
(6,083)
1,730)
19)
(577)
-)
-)
19)
(577)
6) -
(497)
) 6
-)
)
(497)
6,455)
(4,078)
2,377)
7,322)
(6,083)
1,239)
11
(1,200)
1,175)
(25)
(1,530)
1,632)
102)
Profit/(loss) and total comprehensive income for the year
5,255)
(2,903)
2,352)
5,792)
(4,451)
1,341)
Attributable to:
Equity holders of the parent company
Non-controlling interest
Earnings per share - total and continuing
Basic
Diluted
4,926)
329)
(2,803)
(100)
2,123)
229)
5,444)
348)
(4,178)
(273)
13
13
82.7p)
80.5p)
)
)
35.7p)
34.7p)
100.5p)
96.4p)
)
)
1,266)
75)
23.4p
22.5p
There are no items of other comprehensive income for the two years in question.
The accompanying notes form an integral part of these consolidated financial statements.
10
CONSOLIDATED BALANCE SHEET
Note
14
15
16
17
18
19
20
21
23
24
2014)
£000)
4,511)
8,678)
8,662)
21,851)
6,296)
6,227)
11,148)
23,671)
45,522)
(6,397)
-)
(118)
(3,139)
(992)
(10,646)
(9,666)
(1,820)
(11,486)
(22,132)
23,390)
300
14,294)
23)
1,351)
6,910)
22,878)
512)
23,390)
ASSETS
Non-current assets
Property, plant and equipment
Goodwill
Other intangible assets
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Derivative financial instruments: Convertible Redeemable shares
Payables relating to acquisitions
Current portion of long-term borrowings
Current tax payable
Non-current liabilities
Long-term borrowings
Deferred tax liabilities
Total liabilities
Net assets
EQUITY
Share capital
Share premium
Capital redemption reserve
Merger reserve
Retained earnings
Equity attributable to equity holders of the parent company
Non-controlling interest
Total equity
The accompanying notes form an integral part of these consolidated financial statements.
The financial statements were approved by the board on 26 March 2015
David Cicurel
Director
Ralph Cohen
Director
2013)
£000)
4,695)
8,678)
12,913)
26,286)
5,824)
6,547)
10,054)
22,425)
48,711)
(6,075)
(574)
(1,554)
(4,043)
(1,320)
(13,566)
(11,547)
(2,704)
(14,251)
(27,817)
20,894)
293)
14,186)
22)
475)
5,635)
20,611)
283)
20,894)
11
CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
Share
Share
capital premium redemption
reserve
£000
£000
£000
Capital Merger Retained
reserve earnings
Total*
Note
£000
£000)
£000)
Non-
controlling
interest
£000)
Total)
equity)
£000)
Balance at 1 January 2014
293
14,186
22
475
5,635)
20,611)
283)
20,894)
Dividends
Issue of share capital
Arising on conversion and redemption of Convertible
Redeemable shares
Transactions with owners
Profit for the year
Total comprehensive income for the year
12
24
)
25
-
7
-
7
-
-
-
108
-
108
-
-
-
-
1
1
-
-
-
(1,237)
(1,237)
-)
(1,237)
876
-)
991) -
-
389)
390) -
876
(848)
144) -
)
)
)
991)
390)
144)
-
-
2,123)
2,123)
229)
2,352)
2,123)
2,123)
229)
2,352)
Balance at 31 December 2014
300
14,294
23
1,351
6,910)
22,878)
512)
23,390)
Balance at 1 January 2013
265
6,467
22
475
5,254)
12,483)
306)
12,789)
Dividends
Issue of share capital
Transactions with owners
Profit for the year
Total comprehensive income for the year
12
24
-
-
28
7,719
28
7,719
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(885)
(885)
(98)
(983)
-)
7,747) -
)
7,747)
(885)
6,862)
(98)
6,764)
1,266)
1,266)
75)
1,341)
1,266)
1,266)
75)
1,341)
Balance at 31 December 2013
293
14,186
22
475
5,635)
20,611)
283)
20,894)
* - Total represents amounts attributable to equity holders of the parent company.
The accompanying notes form an integral part of these consolidated financial statements.
12
CONSOLIDATED CASH FLOW STATEMENT
Cash flows from operating activities
Profit after tax
Adjustments for:
Financial instruments measured at fair value
Convertible Redeemable shares
Hedging contracts
Contingent consideration measured at fair value
Depreciation
Amortisation of intangible assets
(Gain)/loss on disposal of property, plant and equipment
Foreign exchange (gain)/loss on foreign currency loans
Interest receivable
Interest payable
Tax recovery/(expense) recognised in income statement
Increase in inventories
Decrease)/(increase) in trade and other receivables
Increase/(decrease) in trade and other payables
Cash generated from operations
Interest paid
Tax paid
Net cash from operating activities
Cash flows from investing activities
Paid on acquisition of new subsidiary
Gross cash inherited on acquisition -
Acquisition of subsidiaries, net of cash acquired
Paid on the acquisition of trade and certain assets
Purchase of property, plant and equipment
Interest received
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of share capital
Repayments of borrowings
Proceeds from bank loans -
Dividends paid - equity share holders
Dividends paid - non-controlling interest in subsidiary
Net cash (used in)/from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
The accompanying notes form an integral part of these consolidated financial statements.
2014)
£000)
2,352)
(185)
(4)
16)
376)
4,251)
(5)
(34)
(19)
577)
25)
(472)
320)
268)
7,466)
(572)
(1,237)
5,657)
(500)
)
(500)
(37)
(187)
19)
(705)
113)
(2,734)
)
(1,237)
-)
(3,858)
1,094)
10,054)
11,148)
2013)
£000)
1,341)
340)
(24)
317)
292)
4,498)
18)
127)
(6)
497)
(102)
(783)
(798)
(709)
5,008)
(497)
(840)
3,671)
(13,400)
1,772)
(11,628)
(91)
(2,080)
6)
(13,793)
7,747)
(1,776)
9,770)
(885)
(98)
14,758)
4,636)
5,418)
10,054)
13
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
1. General information
Judges Scientific plc is the ultimate parent company of the group,
whose principal activities comprise the design, manufacture and
sale of scientific instruments.
2. Registered office
The address of the registered office and principal place of
business of Judges Scientific plc is Unit 19, Charlwoods Road, East
Grinstead, West Sussex RH19 2HL.
3. Basis of accounting
The consolidated financial statements have been prepared
under the historical cost convention except for certain financial
instruments which are carried at fair value.
Being listed on the Alternative Investment Market of the
London Stock Exchange, the company is required to present its
consolidated financial statements in accordance with International
Financial Reporting Standards (IFRS) as adopted by the European
Union. Accordingly, these financial statements have been
prepared in accordance with the accounting policies set out
below which are based on the IFRS in issue as adopted by the
European Union (EU) and in effect at 31 December 2014.
4. Use of accounting estimates and judgements
Many of the amounts included in the consolidated financial
statements involve the use of judgement and/or estimation.
These judgements and estimates are based on management’s
best knowledge of the relevant facts and circumstances, having
regard to prior experience, but actual results may differ from
the amounts included in the consolidated financial statements.
Information about such judgements and estimation is contained
in the accounting policies and/or the notes to the consolidated
financial statements and the key areas are summarised below:
Judgements in applying accounting policies:
• the directors must judge whether all of the conditions required
for revenues to be recognised in the income statement of the
financial year, as set out in note 6.4 below, have been met;
Sources of estimation uncertainty:
• depreciation rates are based on estimates of the useful lives
and residual values of the assets involved (see note 6.6);
• estimates are required as to intangible asset carrying values,
their useful lives and goodwill impairment charges. These are
assessed by reference to budgeted profits and cash flows for
future periods for the relevant income generating units and an
estimate of their values in use (see notes 15 and 16);
• warranty provisions are based on estimates of the likely cost of
repairing or replacing faulty units.
5. Changes in accounting policies
5.1 Standards adopted for the first time
A number of new and revised standards are effective for annual
periods beginning on or after 1 January 2014 including IFRS 10
‘Consolidated Financial Statements’. Adoption of these standards
has not had an impact on the group’s financial statements.
5.2 Standards, amendments and interpretations to
existing Standards that are not yet effective
At the date of approval of these consolidated financial statements,
certain new standards, amendments and interpretations to
existing standards have been published but are not yet effective,
and have not been adopted early by the group.
Management anticipates that all of the pronouncements will be
adopted in the group’s accounting policies for the first period
beginning after the effective date of the pronouncement. None of
these new standards, amendments and interpretations are expected
to have a significant impact on the group’s financial statements.
IFRS 9 ‘Financial Instruments’ (EU effective date 1 January 2018)
IFRS 15 ‘Revenues from contracts with customers’
(EU effective date 1 January 2017)
6. Accounting policies
6.1 Basis of consolidation
The consolidated financial statements include those of the parent
call drawn up to 31 December 2014. Subsidiaries are entities
over which the group has the power to control the financial and
operating policies so as to obtain benefits from their activities.
The group obtains and exercises control through voting rights.
Income, expenditure, unrealised gains and intra-group balances
arising from transactions within the group are eliminated.
Unrealised losses are also eliminated unless the transaction
provides evidence of an impairment of the asset transferred.
Amounts reported in the financial statements of subsidiaries have
been adjusted where necessary to ensure consistency with the
accounting policies adopted by the group.
Acquisitions of subsidiaries are dealt with by the acquisition
method. The acquisition method involves the recognition at fair
value of all identifiable assets and liabilities, including contingent
liabilities of the subsidiary, at the acquisition date, regardless of
whether or not they were recorded in the financial statements
of the subsidiary prior to acquisition. In the case of acquisitions
after 31 December 2005, goodwill is stated after separating out
identifiable intangible assets. Goodwill represents the excess of
acquisition cost over the fair value of the group’s share of the
identifiable net assets of the acquired subsidiary at the date of
acquisition. Acquisition-related transaction costs are recorded as
an expense in the income statement.
The parent company has taken the merger relief that is
required by section 612 of the Companies Act 2006 in respect
of the fair value of the consideration received in excess of the
nominal value of the equity shares issued in connection with
the acquisition of Fire Testing Technology Limited, UHV Design
Limited and Scientifica Limited.
14
6.2 Business combinations completed prior to the date of
transition to IFRS
The group has elected not to apply IFRS 3 Business Combinations
retrospectively to business combinations prior to the date of
transition to IFRS on 1 January 2006. Accordingly the classification
of the combination (acquisition, reverse acquisition or merger)
remains unchanged from that used under UK GAAP. Assets and
liabilities are recognised at the date of transition if they would
be recognised under IFRS, and are measured using their UK
GAAP carrying amounts immediately post-acquisition as deemed
cost under IFRS, unless IFRS requires fair value measurement.
Amounts recorded as goodwill under UK GAAP have not
been re-assessed to identify intangible assets. Deferred tax and
minority interest are adjusted for the impact of any consequential
adjustments after taking advantage of the transitional provisions.
6.3 Goodwill
Goodwill, representing the excess of the cost of acquisition over
the fair value of the group’s share of the identifiable net assets
acquired, is capitalised and reviewed annually for impairment.
Goodwill is carried at cost less accumulated impairment losses.
Negative goodwill (where the fair value of net assets acquired
exceeds the purchase price) is recognised immediately after
acquisition in the income statement.
value of the intangible asset reflects market expectations about
the probability that the future economic benefits embodied in the
asset will flow to the group.
Amortisation charges are included as adjusting items in operating
costs in the income statement. Amortisation begins when the
intangible asset is first available for use and is provided at rates
calculated to write off the cost of each intangible asset over its
expected useful life, as follows:
Customer relationships
Non-competition agreements
Distribution agreements
Research and development
Sales order backlog
Brand and domain names
3 years
2 years
Between 2 and 5 years
5 years
On shipment
Between 1 and 5 years
Subsequent to initial recognition, intangible assets are stated
at deemed cost less accumulated amortisation and
impairment charges.
6.6 Property, plant and equipment
Property, plant and equipment is stated at cost, net of
depreciation and any provision for impairment.
The carrying value of negative goodwill at the date of transition
has been credited to reserves. There is no re-instatement of
goodwill or negative goodwill that was amortised prior to
transition to IFRS.
Disposal of assets: the gain or loss arising on the disposal of
an asset is determined as the difference between the disposal
proceeds and the carrying amount of the asset and is recognised
in the income statement.
6.4 Revenue
Revenue is measured by reference to the fair value of
consideration received or receivable by the group, excluding
Value Added Tax, and is recognised when all the following
conditions have been satisfied:
• sales of instruments and spares are recognised on point of
despatch to the customer;
• income from services such as installation, support, training or
consultancy is recognised when the service is performed;
• the amount of revenue and the costs incurred or to be
incurred in respect of the transaction can be measured reliably;
and
• it is probable that the economic benefits associated with the
transaction will flow to the group.
Interest income is recognised using the effective interest method
which calculates the amortised cost of a financial asset and
allocates the interest income over the relevant period. Dividend
income is recognised when the shareholder’s right to receive
payment is established.
6.5 Intangible assets acquired as part of a
business combination
In accordance with IFRS 3 Business Combinations, an intangible
asset acquired in a business combination is deemed to have a
cost to the group of its fair value at the acquisition date. The fair
Depreciation: Depreciation is provided at annual rates calculated
to write off the cost less residual value of each asset over its
expected useful life, within the following ranges:
• Property
2% straight-line on cost of buildings
(excluding the estimated cost of land)
• Plant and machinery 15% on written down value to 25%
• Fixtures, fittings
and equipment
• Motor vehicles
• Building
improvements
straight-line on cost
15% on written down value to 33%
straight-line on cost
25% on written down value to 25%
straight-line on cost
over the minimum life of the lease
Material residual value estimates and expected useful lives are
updated as required but at least annually.
6.7 Impairment testing of goodwill, other intangible assets
F
and property, plant and equipment
or the purposes of assessing impairment, assets are grouped
at the lowest levels for which there are largely independent
cash inflows (cash-generating units). As a result, some assets
are tested individually for impairment and some are tested at
cash-generating unit level. Goodwill is allocated to those cash-
generating units that are expected to benefit from synergies of
the related business combination and represent the lowest level
15
6.7 Impairment testing of goodwill, other intangible
assets and property, plant and equipment - continued
within the group at which management monitors goodwill.
Cash-generating units to which goodwill has been allocated
are tested for impairment at least annually. All other individual
assets or cash-generating units are tested whenever events or
changes in circumstances indicate that the carrying amount may
not be recoverable.
An impairment loss is recognised for the amount by which the
asset’s or cash-generating unit’s carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of
fair value, reflecting market conditions less costs to sell, and
value in use. Value in use is based on estimated future cash flows
from each cash-generating unit, discounted at a suitable rate in
order to calculate the present value of those cash flows. The
data used for impairment testing procedures is directly linked
to the group’s latest approved budgets, adjusted as necessary to
exclude any future restructuring to which the group is not yet
committed. Discount rates are determined individually for each
cash-generating unit and reflect their respective risk profiles as
assessed by the directors.
Impairment losses for cash-generating units reduce first the
carrying amount of any goodwill allocated to that cash-generating
unit. Any remaining impairment loss is charged pro rata to the
other assets in the cash-generating unit. With the exception of
goodwill, all assets are subsequently reassessed for indications
that an impairment loss previously recognised may no longer
exist. Impairment charges are included in operating costs in
the income statement. An impairment charge that has been
recognised is reversed if the cash-generating unit’s recoverable
amount exceeds its carrying amount.
6.8 Leases
For finance leases, in accordance with IAS 17, the economic
ownership of a leased asset is transferred to the lessee if the
lessee bears substantially all the risks and rewards related to the
ownership of the leased asset. The related asset is recognised
as an asset in the balance sheet at the time of inception of the
lease at the fair value of the leased asset or, if lower, the present
value of the minimum lease payments plus incidental payments,
if any, to be borne by the lessee. A corresponding amount is
recognised as a finance lease liability. The interest element of
leasing payments represents a constant proportion of the capital
balance outstanding and is charged to the income statement over
the period of the lease.
All other leases are regarded as operating leases and the
payments made under them are charged to the income statement
on a straight line basis over the period of the lease term. Lease
incentives are spread over the term of the lease.
6.9 Inventories
Inventories are stated at the lower of cost and net realisable
value. Costs of ordinarily interchangeable items are assigned using
the first-in, first-out cost formula. Cost includes materials, direct
labour and an attributable proportion of manufacturing overheads
based on normal levels of activity.
6.10 Taxation
Current tax is the tax currently payable based on taxable profit
for the year.
Deferred taxes are calculated using the liability method on
temporary differences. Deferred tax is generally provided on the
difference between the carrying amounts of assets and liabilities
and their tax bases. However, deferred tax is not provided on
the initial recognition of goodwill, nor on the initial recognition
of an asset or liability unless the related transaction is a business
combination or affects tax or accounting profit. Deferred tax on
temporary differences associated with shares in subsidiaries is
not provided if reversal of those temporary differences can be
controlled by the group and it is probable that reversal will not
occur in the foreseeable future. In addition, tax losses available
to be carried forward as well as other income tax credits to the
group are assessed for recognition as deferred tax assets.
Deferred tax liabilities are provided in full, with no discounting.
Deferred tax assets are recognised to the extent that it is
probable that the underlying deductible temporary differences will
be able to be offset against future taxable income. Current and
deferred tax assets and liabilities are calculated at tax rates that
are expected to apply to their respective period of realisation,
provided they are enacted or substantively enacted at the balance
sheet date.
Changes in deferred tax assets or liabilities are recognised as a
component of tax expense in the income statement, except:
• where they relate to items that are charged or credited
directly to equity in which case the related deferred tax is also
charged or credited directly to equity, or
• where items are recognised in other comprehensive income,
in which case the related deferred tax is recognised in other
comprehensive income.
6.11 Share-based payments
IFRS 2 has been applied, in accordance with IFRS 1 and where the
effect is material, to equity-settled share options granted on or
after 7 November 2002 and not vested prior to 1 January 2006.
All goods and services received in exchange for the grant of
any share-based payment are measured at their fair values.
Where employees are rewarded using share-based payments,
the fair values of employees’ services are determined indirectly
by reference to the fair value of the instrument granted to the
employee. This fair value is appraised at the grant date and
excludes the impact of non-market vesting conditions.
16
All equity-settled share-based payments are ultimately recognised
as an expense in the income statement, with a corresponding
credit to “other reserve”.
If vesting periods or other non-market vesting conditions
apply, the expense is allocated over the vesting period, based
on the best available estimate of the number of share options
expected to vest. Estimates are subsequently revised if there
is any indication that the number of share options expected to
vest differs from previous estimates. Any cumulative adjustment
prior to vesting is recognised in the current period. The impact
of the revision of the original estimates, if any, is recognised in
the income statement over the remaining vesting period, with
a corresponding adjustment to the appropriate reserve. No
adjustment is made to any expense recognised in prior periods if
share options ultimately exercised are different to that estimated
on vesting.
Upon exercise of share options, the proceeds received net of
attributable transaction costs are credited to share capital and,
where appropriate, share premium (see note 24).
6.12 Financial assets
Financial assets (other than cash) are assigned to relevant
categories by management on initial recognition, depending on
the purpose for which they were acquired. At the balance sheet
date, the group held only loans, receivables and derivatives.
All financial assets are recognised when the group becomes a
party to the contractual provisions of the instrument. Loans
and receivables are recognised initially at fair value plus
transaction costs.
Loans and receivables are non-derivative financial assets with
fixed or determinable payments that are not quoted in an active
market. Trade receivables are classified as loans and receivables.
Loans and receivables are measured subsequent to initial
recognition at amortised cost using the effective interest method,
less provision for impairment. Any change in their value through
impairment or reversal of impairment is recognised in operating
costs in the income statement.
Provision against trade and other receivables is made when there
is objective evidence that the group will not be able to collect all
amounts due to it in accordance with the original terms of those
receivables. The amount of the write-down is determined as the
difference between the asset’s carrying amount and the present
value of estimated future cash flows, discounted at the original
effective interest rate.
A financial asset is derecognised only where the contractual rights
to the cash flows from the asset expire or the financial asset is
transferred and that transfer qualifies for derecognition.
A financial asset is transferred if the contractual rights to receive
the cash flows of the asset have been transferred or the group
retains the contractual rights to receive the cash flows of the
asset but assumes a contractual obligation to pay the cash flows
to one or more recipients. A financial asset that is transferred
qualifies for derecognition if the group transfers substantially all
the risks and rewards of ownership of the asset, or if the group
neither retains nor transfers substantially all the risks and rewards
of ownership but does transfer control of that asset.
6.13 Financial liabilities
Financial liabilities are obligations to pay cash or other financial
assets and are recognised when the group becomes a party to
the contractual provisions of the instrument. Financial liabilities
are recorded initially at fair value net of direct issue costs if they
are not held at fair value through profit and loss. Derivatives
are recorded at fair value through profit or loss. The fair value
of derivative financial instruments is determined by reference to
active market transactions or using a valuation technique where
no active market exists.
All financial liabilities with the exception of Convertible
Redeemable shares (see paragraph 6.19), interest rate swaps
and foreign currency options are recorded at amortised cost
using the effective interest method, with interest-related charges
recognised as an expense in finance cost in the income statement.
These financial liabilities include trade and other payables and
borrowings, including bank loans, subordinated loans and hire
purchase commitments. Finance charges, including premiums
payable on settlement or redemption and direct issue costs, are
charged to the income statement on an accruals basis using the
effective interest method and are added to the carrying amount
of the instrument to the extent that they are not settled in the
period in which they arise.
Interest rate swaps and foreign currency options are treated as
derivative financial instruments and are accounted for at fair value
through profit and loss.
A financial liability is derecognised only when the obligation
is extinguished, that is, when the obligation is discharged or
cancelled or expires.
6.14 Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and
demand deposits, together with other short-term, highly
liquid investments that are readily convertible into known
amounts of cash and which are subject to an insignificant risk of
changes in value.
6.15 Pensions
Companies in the group operate defined contribution pension
schemes for employees and directors. The assets of the
schemes are held by investment managers separately from
those of the group. The pension costs charged against profits
are the contributions payable to the schemes in respect of the
accounting period.
17
6.16 Foreign currencies
6.20 Exceptional items
Transactions in foreign currencies are translated at the exchange
rate ruling at the date of the transaction. Monetary assets and
liabilities in foreign currencies are translated at the rates of
exchange ruling at the balance sheet date. Exchange differences
arising on the settlement of monetary items or on translating
monetary items at rates different from those at which they were
initially recorded are recognised in the income statement in the
period in which they arise.
6.17 Dividends
Final dividend distributions payable to equity shareholders are
included in trade and other payables when the dividends are
approved in general meeting but not paid prior to the balance
sheet date. Interim dividends are recognised in the periods in
which they are paid.
6.18 Equity
Equity comprises the following:
•
•
•
•
•
•
•
“Share capital” represents the nominal value of equity
shares.
“Share premium” represents the excess over nominal value
of the fair value of consideration received for equity shares,
net of expenses of the share issue.
“Capital redemption reserve” represents amounts set
aside from retained earnings on conversion of Convertible
Redeemable shares equal to the reduction then arising in
the overall nominal value of share capital of all classes.
“Merger reserve” represents the fair value of the
consideration received in excess of the nominal value of
equity shares issued in connection with acquisitions where
the company has taken the merger relief that is required by
section 612 of the Companies Act 2006.
“Retained earnings” represents retained profits and losses.
“Revaluation reserve” represents gains and losses due to
the revaluation of certain financial assets.
“Non-controlling interest” represents retained profits
and losses attributable to minority shareholders in
subsidiary companies.
6.19 Convertible Redeemable shares
Under the terms of IAS 39 Financial Instruments – Recognition
and Measurement, the Convertible Redeemable shares in
the company are deemed to represent a derivative financial
instrument. As such, it is a requirement that they be fair-
valued at each accounting date, with changes in fair-value being
recognised through profit and loss. The fair value is calculated
with reference to the market price of the company’s Ordinary
shares and the exercise price. In accordance with IAS 32
Financial Instruments: Presentation, on conversion the fair value
of the Convertible Redeemable shares converted is transferred
directly to equity. As described in note 25, the Convertible
Redeemable shares were fully converted or redeemed prior to
31 December 2014.
Exceptional items (and their related tax impact) are those
which by their size or nature are disclosed separately for the
purposes of presenting results and earnings per share figures so
as to enable users of the financial statements to evaluate more
effectively the ongoing performance of the group.
6.21 Research and development
Research and development expenditure is recognised in the
income statement as an expense as incurred until it can be
demonstrated that the conditions for capitalisation under
IAS 38 apply.
The criteria for capitalisation include demonstration that the
project is technically and commercially feasible, the group has
sufficient resources to complete development and the asset will
generate probable future economic benefit.
6.22 Provisions for warranty claims
Provisions for warranty claims are recognised when; the
company has a legal or constructive obligation as a result of
a past event; it is probable that an outflow of resources will
be required to settle the obligation; and the amount has been
reliably estimated. Provisions are discounted where the time
value of money is material.
7. Segment reporting
7.1 Identification of reportable segments
The group’s activities are predominantly in or in support of the
design and manufacture of scientific instruments. The group
operates two main operating segments: the Materials Sciences
group and the Vacuum group. No operating segments have been
aggregated.
7.2 Management of operating segments
The operating segments are monitored by the group’s
Chief Operating Decision Maker. Each of the operating
segments is managed independently, each range of instruments
having its individual requirements in terms of design,
manufacture and marketing.
7.3 Measurement policies
The results of operating segments are prepared by reference
to their contributions to group earnings before interest, tax
and exceptional items (“group EBITA”). This is stated before
the allocation of head office costs and after elimination of non-
controlling interest. Assets and liabilities directly attributable
to the activities of the operating segments are included in their
respective balance sheets; corporate assets and liabilities held by
the parent company are not allocated to subsidiaries.
18
7.4 Segment analysis
Segment analysis is as follows:
2014
Consolidated group revenues from external customers
Contributions to group EBITA
Depreciation
Amortisation of intangible assets
Segment assets
Segment liabilities
Intangible assets - goodwill
Other intangible assets
Additions to non-current assets
Materials Sciences
£000
14,427
3,175
76
1,641
6,548
4,892
5,156
2,515
14
2013
Materials Sciences
Consolidated group revenues from external customers
Contributions to group EBITA
Depreciation
Amortisation of intangible assets
Segment assets
Segment liabilities
Intangible assets - goodwill
Other intangible assets
Additions to non-current assets
£000
14,764
3,710
91
1,647
7,375
5,009
5,156
4,156
39
Vacuum
£000
26,141
4,235
243
2,610
12,021
19,318
3,522
6,147
177
Vacuum
£000
21,277
4,631
177
2,851
13,234
21,225
3,522
8,757
13,647
Total
£000
40,568
7,410
319
4,251
18,569
24,210
8,678
8,662
191
Total
£000
36,041
8,341
268
4,498
20,609
26,234
8,678
12,913
13,686
Segment revenue is presented on the basis of the destination of the goods where known, failing which on the geographical location of
customers. Segment assets are based on the geographical location of assets.
United Kingdom (domicile)
Rest of Europe
United States/Canada
Rest of the world
Total
2014
2013
Revenue
£000
Non-current
assets
£000
7,160
12,799
8,235
12,374
40,568
21,851
-
-
-
21,851
Revenue
£000
6,680
11,434
6,055
11,872
36,041
Non-current
assets
£000
26,286
-
-
-
26,286
19
7.4 Segment analysis - continued
Reconciliations between totals presented by operating segment and the group’s consolidated figures are as follows:
Contribution to group EBITA
Total contribution to group EBITA
Expenses not allocated
Exceptional items
Amortisation of intangible assets
Contingent consideration measured at fair value
Financial instruments measured at fair value
Convertible Redeemable shares
Hedging contracts
Relocation costs
Acquisition costs
Elimination of non-controlling interest adjustment in contribution to group EBITA
Operating profit after exceptional items
Interest receivable
Interest payable
Profit before tax
Depreciation
Total segment depreciation charge
Head office depreciation not allocated
Consolidated depreciation charge
Segment assets and liabilities
Total segment assets
Parent company assets (excluding corporation tax)
Assets eliminated on consolidation
Other assets - goodwill
Other assets - intangible assets
Consolidated total assets
Total segment liabilities
Parent company liabilities
Derivative financial instruments
Liabilities eliminated on consolidation
Acquisition related loans
Other liabilities
Convertible Redeemable shares
Deferred tax
Consolidated total liabilities
2014)
£000)
7,410)
(830)
(4,251)
(16)
185)
4)
)
)
433)
2,935)
19)
(577)
2,377)
319)
57)
376)
18,569)
25,327)
(15,714)
8,678)
8,662)
45,522)
24,210)
11,605)
)
(24,132)
8,421)
302)
)
1,726)
22,132)
)
-
-
-
-
2013)
£000)
8,341)
(980)
(4,498)
(317)
(340)
24)
(158)
(794)
452)
1,730)
6)
(497)
1,239)
268)
24)
292)
20,609)
16,510)
(9,999)
8,678)
12,913)
48,711)
26,234)
6,661)
574)
(11,312)
1,316)
1,711)
1)
2,632)
27,817)
Revenues are derived from the sales of manufactured products; revenues from installation and support services are not material. There are no major
customers which make up 10% or more of the group’s revenues.
Expenses not allocated comprise head office costs. Parent company assets include £3,256,000 (2013: £3,318,000) in respect of two freehold properties.
One is partly let at open market value to a member of the Materials Sciences segment, whilst the other is let at open market value to two members of the
Vacuum segment.
20
8. Operating costs
11. Taxation charge/(credit)
Raw materials and consumables
Other external charges
Staff costs
Depreciation
Other operating costs, excluding exceptional items
Amortisation of intangible assets
Contingent consideration measured at fair value
(Credit)/charge relating to derivative
financial instruments
Hedging contracts
Relocation costs
Acquisition costs
Total operating costs, including exceptional items
2014)
£000)
2013)
£000)
17,548) 14,232)
4,435)
4,806
9,269)
10,825
292)
376
33,555 28,228)
4,498
4,251
317
16
(185)
(4)
-
-
340)
(24)
158
794
37,633 34,311)
Research and development expensed in the year totalled
£1,629,000 (2013: £1,366,000). This does not include
amortisation of research and development intangibles arising
on acquisition.
9. Operating profit
2014
£000
2013
£000
23
70)
31)
-)
12)
376)
Operating profit is stated after charging:
Fees payable to the company’s auditor:
for the audit of the company’s annual accounts
Fees payable to the company’s auditor for other services:
for the audit of the company’s subsidiaries,
pursuant to legislation
for tax services
for corporate finance transactions
for all other services
Depreciation
Crystallised loss on foreign exchange
(prior to accounting for enhanced gross profits
estimated in a similar amount arising from
currency movements)
Amortisation of intangible assets
Operating lease rentals - land and property
Operating lease rentals - vehicles
Operating lease rentals - other
-)
4,251)
363)
32)
6) -
20
70)
29)
66)
13)
292)
431)
4,498)
322)
24)
)
10. Interest receivable and payable
Interest receivable - short-term bank deposits
Interest payable - bank loans
Net interest payable
2014)
£000)
2013)
£000)
19) 6
(577)
(558)
)
(497)
(491)
UK corporation tax at 21.5% (2013: 23.25%)
Current year
Prior years
Deferred tax - origination and reversal of
temporary differences:
Current year
Prior years
Tax on profit for the year - current year
Tax on profit for the year - prior years
2014) 2013)
£000) £000)
1,101) 1,339)
(192)
(163)
909) 1,176)
(890) (1,271)
(7)
(884) (1,278)
6)
211)
(186)
25)
68)
(170)
(102)
Factors affecting the tax charge for the year:
Profit before tax
2,377) 1,239)
Profit before tax multiplied by standard rate of
UK corporation tax of 21.5% (2013: 23.25%)
Carry back against prior year losses
Exercise of share options
Provisions and expenditure not deductible
for tax purposes
Derivative (credit)/charge
Contingent consideration
Other timing differences
Tax on profit for the year - current year
Tax on profit for the year - prior years
Total net taxation charge/(credit)
511)
-)
(255)
) 16)
(59)
3)
(5)
211)
(186)
25)
288)
(40)
(154)
128)
79)
74)
(307)
68)
(170)
(102)
12. Dividends
2014
2013
p/share £000
p/share £000
Final dividend for the previous year
Interim dividend for the current year
13.4
7.3
799
438
20.7 1,237
10.0
6.6
16.6
532
353
885
The directors will propose a final dividend of 14.7p per share,
amounting to £882,000, for payment on 10 July 2015. As this
remains conditional on shareholders’ approval, provision has not
been made in these consolidated financial statements.
Dividends declared by subsidiaries that are not wholly-owned are
paid to the non-controlling interest in the period in which they are
declared and amounted to £nil in the year (2013: £98,000).
21
13. Earnings per share
Options over Ordinary shares and rights of conversion of the
Convertible Redeemable shares are described in notes 24 and 25.
The calculation of basic earnings per share is derived from the
earnings attributable to Ordinary shareholders divided by the
weighted average number of shares in issue during the period.
The calculation of diluted earnings per share is derived from
the basic earnings per share, adjusted to allow for the issue of
shares on the assumed conversion of all dilutive options and
other dilutive potential Ordinary shares in line with the treasury
method prescribed in IAS 33. This regards the assumed proceeds
from these instruments as having been received from the issue of
Ordinary shares at the average market price of Ordinary shares
during the period. The difference between the number of Ordinary
shares issued on the assumed exercise of the dilutive options and
the number of Ordinary shares that would have been issued at
the average market price of Ordinary shares during the period is
treated as an issue of Ordinary shares for no consideration, and
thus dilutive.
Year to 31 December 2014
Earnings attributable to equity) Weighted average)
number of shares)
holders of the parent company)
no.)
£000)
Earnings)
per share)
pence)
Profit after tax including exceptional items for calculation of basic and diluted earnings per share
Add-back exceptional items net of tax and non-controlling interest, as applicable:
Charge relating to derivative financial instruments
Hedging contracts
Convertible Redeemable shares
Contingent consideration measured at fair value
Tax relief on exercise of share options
Amortisation of intangible assets
Utilisation of prior year tax losses
Basic and diluted profit after tax, excluding exceptional terms
Number of shares for calculation of basic earnings per share including exceptional items
Effect of potential shares
Number of shares for calculation of diluted earnings per share including exceptional items
Dilutive effect of potential derivative financial instruments
Number of shares for calculation of diluted earnings per share excluding exceptional items
2,123)
(3)
(204)
16
(255)
3,244)
5)
4,926)
)
5,952,952)
151,350)
6,104,302)
17,002)
6,121,304)
Basic earnings per share (including exceptional items)
Diluted earnings per share (including exceptional items)
Basic earnings per share (excluding exceptional items)
Diluted earnings per share (excluding exceptional items)
Year to 31 December 2013
35.7)
34.7)
82.7)
80.5)
Earnings attributable to equity) Weighted average
number of shares
holders of the parent company)
no.
£000)
Earnings)
per share)
pence)
Profit after tax including exceptional items for calculation of basic and diluted earnings per share
Add-back exceptional items net of tax and non-controlling interest, as applicable:
Charge relating to derivative financial instruments
Hedging contracts
Convertible Redeemable shares
Contingent consideration measured at fair value
Tax relief on exercise of share options
Amortisation of intangible assets
Acquisition costs
Relocation costs
Utilisation of prior year tax losses
Basic and diluted profit after tax, excluding exceptional terms
Number of shares for calculation of basic earnings per share including exceptional items
Effect of potential shares
Number of shares for calculation of diluted earnings per share including exceptional items
Dilutive effect of potential derivative financial instruments
Number of shares for calculation of diluted earnings per share excluding exceptional items
Basic earnings per share (including exceptional items)
Diluted earnings per share (including exceptional items)
Basic earnings per share (excluding exceptional items)
Diluted earnings per share (excluding exceptional items)
1,266)
(18)
340)
317)
(154)
2,897)
716)
120)
(40)
5,444)
)
5,417,971)
201,205)
5,619,176)
26,068)
5,645,244)
23.4)
22.5)
100.5)
96.4)
22
14. Property, plant and equipment
Cost / deemed cost
1 January 2013
Additions
Acquisitions
Disposals
31 December 2013
Additions
Disposals
31 December 2014
Depreciation
1 January 2013
Charge
Disposals
31 December 2013
Charge
Disposals
31 December 2014
Net book value – 31 December 2014
Net book value – 31 December 2013
Plant &)
machinery)
£000)
Fixtures,)
fittings &)
equipment)
£000)
Motor)
vehicles)
£000)
Property)
& building)
improvements)
£000)
633)
38)
-)
(22)
649)
112)
-)
761)
402)
63)
(12)
453)
59)
-)
512)
249)
196)
597)
159)
67)
(34)
789)
54)
(12)
831)
306)
120)
(26)
400)
151)
(12)
539)
292)
389)
108)
67)
37)
(28)
184)
16) 5
(28)
172)
75)
39)
(28)
86)
40)
(33)
93)
79)
98)
2,277)
1,816)
119)
(59)
4,153)
)
-)
4,158)
130)
70)
(59)
141)
126)
-)
267)
3,891)
4,012)
Total)
£000)
3,615)
2,080)
223)
(143)
5,775)
187)
(40)
5,922)
913)
292)
(125)
1,080)
376)
(45)
1,411)
4,511)
4,695)
Included in the net book value of property and building improvements at 31 December 2014 is £2,710,000 (2013: £2,764,000) relating to the development
of a new factory in Laughton, East Sussex. Quorum Technologies Limited and UHV Design Limited relocated to the premises in September 2013.
The remaining contractual commitment under this project, not provided for in these financial statements, amounted to £36,000 at 31 December 2014
(2013: £36,000). The net book value of plant, machinery and vehicles included above held under finance leases and hire purchase contracts amounted to
£48,000 at 31 December 2014 (2013: £70,000).
15. Goodwill
Cost
1 January
Addition in year
31 December
2014
£000
8,678
-
8,678
2013
£000
5,809
2,869
8,678
An analysis of goodwill by operating segment is given in note 7.
There have been no impairment charges in either 2014 or 2013.
Goodwill is tested annually for impairment by reference to the
value in use of the relevant cash generating units, which are the
group’s operating segments. This is calculated on the basis of
projected cash flows for the following five years derived from
detailed budgets for the ensuing year based on past experience,
with subsequent years including modest nominal rates of sales
and cost growth of 3% per annum and generally steady gross
margins. The 3% long term growth rate takes into account
both UK and overseas markets. These cash flows are adjusted
to present day values at a discount rate based on a weighted
average cost of capital of 11.3% (2013: 10.6%) per annum,
calculated by reference to year-end data on equity values and
interest, dividend and tax rates. The long term growth rate and
discount rate is consistent for all segments on the basis that
they all operate in similar markets and are exposed to similar
risks. The residual value at the end of the five years, computed
by reference to projected year six cash flows and discounted,
is also included. There was no requirement for any impairment
provision at 31 December 2014.
The directors have considered the sensitivity of the key
assumptions, including the weighted average cost of capital and
long term growth rates, and have concluded that any possible
changes that may be reasonably contemplated in these key
assumptions would not result in the value in use falling below
the carrying value of goodwill, given the amount of headroom
available.
23
16. Other intangible assets
Non- Distribution
compete agreements
Research Sales order
backlog
agreement
£000
and
development
£000
£000
Gross carrying amount
1 January 2013
Additions
At 31 December 2013 and 31 December 2014
Amortisation
1 January 2013
Charge for the year
31 December 2013
Charge for the year
31 December 2014
Carrying amount 31 December 2014
Carrying amount 31 December 2013
497
-
497
448
49
497
-
497
-
-
1,519
430
1,949
826
257
1,083
304
1,387
562
866
2,930
1,508
4,438
634
737
1,371
868
2,239
2,199
3,067
An analysis of other intangible assets by operating segment is given in note 7.
Brand and Customer
domain relationships
names
£000
£000
2,892
4,456
7,348
725
995
1,720
1,427
3,147
3,424
3,001
6,425
1,534
1,539
3,073
1,652
4,725
Total
£000
12,617
10,316
22,933
5,522
4,498
10,020
4,251
14,271
4,201
1,700
8,662
5,628
3,352
12,913
£000
1,355
921
2,276
1,355
921
2,276
-
2,276
-
-
17. Inventories
18. Trade and other receivables
Raw materials
Work in progress
Finished goods
2014
£000
4,331
895
1,070
6,296
2013
£000
4,326
848
650
5,824
Trade receivables
Prepayments and accrued income
Other receivables
2014
£000
5,221
542
464
6,227
2013
£000
5,595
417
535
6,547
In 2014, a total of £17,548,000 of inventories was included in
the income statement as an expense (2013: £14,232,000).
This includes an amount of £95,000 (2013: £52,000) resulting
from write-downs of inventories and an amount of £44,000
(2013: £64,000) which is the reversal of previous write-downs.
The carrying amount of inventories held at fair value less costs
to sell is £859,000 (2013: £463,000). All group inventories form
part of the assets pledged as security in respect of bank loans.
The carrying value of receivables, all of which are short-term, is
considered a reasonable approximation of fair value. All trade
and other receivables have been reviewed for impairment with
no material provision being required.
In addition, some of the unimpaired trade receivables were past
due at the balance sheet date as follows:
Not more than 3 months
More than 3 months but not more than 6 months
More than 6 months but not more than 1 year
Greater than one year
2014
£000
1,525
71
48
44
1,688
2013
£000
2,189
737
131
12
3,069
24
All amounts are short-term and their carrying values are
considered reasonable approximations of fair value.
31 December 2013
19. Trade and other payables
Trade payables
Accruals and deferred income
Social security and other taxes
Other payables
2014
£000
3,517
1,875
496
509
6,397
2013
£000
3,617
1,694
428
336
6,075
All amounts are short-term and their carrying values are
considered reasonable approximations of fair value. Other
payables include £nil (2013: £521) of non equity shares classed
as financial liabilities (see note 25).
20. Current portion of long-term borrowings
Bank loans
Subordinated loans
Net obligations under hire purchase contracts
2014
£000
2,625
497
17
3,139
2013
£000
3,523
497
23
4,043
The subordinated loans were advanced by minority shareholders
in Bordeaux Acquisition Limited. They are unsecured, interest free
and repayable at the discretion of that company.
21. Long-term borrowings
Bank loans
Net obligations under hire purchase contracts
2014
£000
9,655
11
9,666
2013
£000
11,519
28
11,547
Borrowings comprise three bank loans secured on assets of the
group. The hire purchase obligations are secured on the related
assets. The repayment profile of borrowings is as set out in
note 22:
• The first loan, amounting to £11,228,000 and negotiated in
December 2014, is repayable in quarterly instalments over the
period ending 31 December 2019 and bears interest at 1.75 to
2.75% (depending upon gearing) above LIBOR-related rates.
• The second loan, amounting to £860,000 (2013: £1,180,000),
is repayable in quarterly instalments with a final payment in
March 2016 and bears interest at 3.25% above LIBOR-related
rates.
•
The third loan, amounting to £192,000 (2013: £238,000), is
repayable in quarterly instalments over the period ending 31
March 2019 and bears interest at 3.75% above LIBOR-related
rates.
22. Maturity of borrowings and net debt
31 December 2014
Bank Subordinated
loans
£000
loans purchase
£000
£000 £000
Hire Total
Repayable in less than 6 months 1,456
Repayable in months 7 to 12
1,441
Current portion of long-term
borrowings
Repayable in years 1 to 5
Total borrowings
2,897
10,101
12,998
718
Less: interest included above
cash and cash equivalents 11,148
497
-
497
-
497
-
-
8 1,961
9 1,450
17 3,411
11 10,112
28 13,523
718
-
- 11,148
Total net debt
1,132
497
28 1,657
Adjusted net debt (including
accrued deferred consideration)
1,775
Hire Total
Bank Subordinated
loans
£000
loans purchase
£000
£000 £000
Repayable in less than 6 months 2,069
2,036
Repayable in months 7 to 12
Current portion of long-term
borrowings
Repayable in years 1 to 5
Later than 5 years
Total borrowings
4,105
12,331
11
16,447
Less: interest included above
1,405
cash and cash equivalents 10,054
497
-
497
-
-
497
-
-
15 2,581
11 2,047
26 4,628
25 12,356
11
51 16,995
-
- 1,405
- 10,054
Total net debt
4,988
497
51 5,536
Adjusted net debt (including
accrued deferred consideration)
5,691
A proportion of the group’s bank loans is drawn in foreign
currencies to provide a hedge against assets denominated in
those currencies. The Sterling equivalent at 31 December 2014
of loans denominated in Euros was £466,000 (2013: £499,000).
These amounts are included in the figures above for bank loans,
repayable in years 1 to 5.
25
Equity share options and warrants
At 31 December 2014, options had been granted and remained
outstanding in respect of 180,254 Ordinary shares in the company,
all priced by reference to the mid-market price of the shares on the
date of grant and all exercisable, following a 3-year vesting period,
between the third and tenth anniversaries of grant, as below:
2014
2013
Number)) Weighted Number) Weighted
average
exercise
price
p/share
average
exercise
price
p/share
2005 Approved Plan
113,554))
Outstanding at 1 January
5,200))
Granted in year
Exercised or lapsed in year
(29,850))
Outstanding at 31 December 88,904))
563.0 140,450)
22,875)
1,794.7
442.4
(49,771)
675.5 113,554)
229.9
1,642.6
119.3
563.0
Of which exercisable at
31 December
56,079))
240.5
55,179)
110.5
2005 Unapproved Plan
127,650))
Outstanding at 1 January
700))
Granted in year
Exercised or lapsed in year
(37,000))
Outstanding at 31 December 91,350))
186.1 127,650)
-) -
2,180.0
101.5
-) -
235.6 127,650)
186.1
186.1
Of which exercisable at
31 December
90,650))
220.6
99,150
104.5
Total
241,204))
Outstanding at 1 January
5,900))
Granted in year
Exercised or lapsed in year
(66,850))
Outstanding at 31 December 180,254))
363.5 268,100)
22,875)
1,840.4
253.7
(49,771)
452.6 241,204)
209.1
1,642.6
119.3
363.5
Of which exercisable at
31 December
146,729))
228.2 154,329)
106.6
Exercise prices at 31 December 2014 ranged from 92.0p/share
to 2317.5p/share (2013: 92.0p/share to 1690.0p/share), with a
weighted average remaining contractual life of 4.98 years
(2013: 5.32 years).
23. Deferred tax liabilities
2014)
£000)
2013)
£000)
1 January
Acquisition in year - amount recognised
Acquisition in year - attributable to intangible assets
Credit to income statement in the year
31 December
2,704)
-)
-)
(884)
1,820)
1,562)
48)
2,372)
(1,278)
2,704)
Deferred tax balances relate to temporary
differences as follows:
Accelerated capital allowances
Provisions allowable for tax in subsequent period
Intangible assets
Total
94)
6) 5
1,720)
1,820)
72)
)
2,627)
2,704)
Amounts provided in respect of deferred tax are computed at
20% (2013: 21%).
24. Share capital
Allotted, called up and fully paid -
Ordinary shares of 5p each
1 January: 5,862,270 shares (2013: 5,312,499)
2014
£000
2013
£000
293
265
Placing of 500,000 new Ordinary shares at 1625p/share
in 2013
-
25
Issue of 42,372 Ordinary shares as part of the deferred
consideration due following the acquisition of
Scientifica Limited
Exercise of share options: 61,600 shares (2013: 49,771)
Conversion of Convertible Redeemable shares:
29,969 Ordinary shares (2013: nil)
2 -
3 3
2
-
31 December: 5,996,211 shares (2013: 5,862,270)
300
293
Allotments of Ordinary shares in 2014 were made:
by way of the issue of 42,372 Ordinary shares on 22 May,
when the share price was 2080.0p, to satisfy the deferred
consideration due following the acquisition of Scientifica
Limited in June 2013;
on the conversion of 208,333 Convertible Redeemable shares
(1p paid/share) into 29,969 Ordinary shares (at a subscription
price of 95.0p/Ordinary share) on 18 August when the
•
Ordinary share price was 1392.5p; and
•
to satisfy the exercise of 61,600 share options in aggregate
on 13 occasions during the year when the share price was
within the range of 1530.0p to 2375.0p (2013: the exercise of
49,771 share options when the share price was within the
range 975.0p to 1830.0p).
•
26
Options were exercised during 2014 by one director
(2013: one) as follows:
25. Convertible Redeemable shares classed as
financial liabilities
Grant of options
Market price on
date of exercise
per share
Number of shares
Mr R L Cohen
20 October 2005 at 101.5p
2000.0p
37,000
Options remain exercisable by three directors as follows:
Allotted - shares of 1p each
1 January 2014: 208,333 shares (2013: 208,333)
- ¼p paid
Paid up to 1p per share - 208,333 shares (2013: nil)
Conversion into Ordinary shares: 208,333 shares
(2013: nil) - see note 24
Grant of options
Number of shares
Mr D E Cicurel Mr D Barnbrook Mr R L Cohen
31 December 2014: nil shares
(2013: 208,333) - ¼p paid
2014)
£000)
2013)
£000)
)
1) 1
1) -
)
(2)
)
)
-)
-) 1
)
The last outstanding holding of Convertible Redeemable
shares was converted into Ordinary shares in 2014. Under
the terms of IAS 39 Financial Instruments, Recognition and
Measurement, the conversion and redemption feature within
the Convertible Redeemable shares was deemed to represent
a derivative financial instrument. As such, it is a requirement
that they be fair-valued at each accounting date, with changes in
fair-value being recognised through the income statement. The
increase in the market price of the company’s Ordinary shares
over time has correspondingly increased the fair value of the
Convertible Redeemable shares. This has resulted in a £185,000
credit (before and after tax) in the year ended 31 December
2014 (2013: £340,000 charge before and after tax), arising
from changes in the Ordinary share price between 1 January
2014 and the date of conversion. Reductions in the provision
arising on redemptions and conversions into Ordinary shares
are transferred directly to equity. The fair value liability at
31 December 2014 was £nil (2013: £574,000).
20 October 2005
at 101.5p
28 April 2008
at 124p
23 July 2009
at 92p
9 May 2011
at 470p
25 October 2013
at 1690p
-
-
-
-
1,775
1,775
5,000
6,550
10,000
5,000
1,775
28,325
-
-
1,100
5,000
1,775
7,875
The market price of the company’s Ordinary shares on
31 December 2014 was 1375.0p, the highest price during 2014
was 2375.0p on 11 April, the lowest price during 2014 was
1095.0p on 15 October and the price on 18 March 2015 was
1687.5p.
In accordance with IFRS 2, a Black Scholes valuation model
has been used. This has indicated that no material expense
is required to be charged for the years ended 31 December
2014 and 31 December 2013. As such, no adjustment has been
made to either the consolidated or parent company financial
statements.
Throughout 2014, the group continued to award a free
“matching share” under the Judges Scientific Share Incentive Plan
for every share purchased up to a maximum value of £600 per
employee per tax year. In 2014, an average of 63 employees
participated in the scheme each month (2013: 55 employees),
purchasing 6,762 shares in total, including matching shares
(2013: 8,560 shares). Included in these figures, shares acquired
by directors, including matching shares, were 131 acquired by
Mr D E Cicurel (2013: 153), 110 by Mr D Barnbrook
(2013: 133) and 132 by Mr R L Cohen (2013: 152).
27
26. Emoluments of directors and key
management personnel
27. Employees
Executive directors
Non-executive directors
Total directors’ emoluments:
Emoluments
Defined contribution pension scheme contributions
Emoluments of the highest paid director:
Emoluments
2014
no.
2013
no.
3 3
3 3
6 6
£000
£000
540
6 6
546
592
598
162
184
During the year one director participated in a defined contribution
pension scheme (2013: one).
Compensation of key management personnel
Emoluments, benefits, pension contributions
and social security costs
1,331
1,355
Short term employee benefits:
Salaries including bonuses and social security costs 1,229
54
Company car allowance and other benefits
1,283
Total short term employee benefits
1,251
57
1,308
Post-employment benefits:
Defined contribution pension plans
Total post-employment benefits:
Total remuneration
48
48
47
47
1,331
1,355
Key management personnel comprise directors of the parent
company and the managing directors of the principal operating
companies. The compensation of the non-executive directors
of the parent company is determined by the Board of directors
as a whole, that of the executive directors of the parent
company is determined by the Remuneration Committee of
the Board (comprising the non-executive directors) and that of
the managing directors of the principal operating companies is
determined by the group Chief Executive.
Number of employees – average in the year
By function - manufacturing
- sales and administration
By operating segment
Materials Sciences group
Vacuum group
Head office (including 3 non-executive directors
in both years)
Employment costs
Wages and salaries
Social security costs
Pension costs
2014
no.
2013
no.
125
145
270
94
168
114
108
222
91
123
8
8
270
222
2014
£000
9,591
1,000
234
2013
£000
8,209
866
194
10,825
9,269
28. Financial instruments
The group’s policies on treasury management, capital
management objectives and financial instruments are given in the
Strategic Report.
Fair value of financial instruments
Financial instruments include the borrowings set out in note 22.
The group enters into derivative financial instruments in order
to manage its interest rate and foreign currency exposure.
The principal derivatives used include interest rate swaps and
foreign currency options. Material changes in the carrying values
of these instruments are recognised in the income statement
in the periods in which the changes arise. Such recognition is
treated as an exceptional item in the income statement where
the foreign currency hedge was entered into in order to
protect profits in later accounting periods. In such cases, the
charge or credit will be reversed out of exceptional items in
the accounting period for which the hedge was intended and
will be shown in results before exceptional items. All financial
instruments denominated in foreign currencies are translated
at the rate of exchange ruling at the balance sheet date. The
directors believe that there is no material difference between
the book value and fair value of all financial instruments.
Borrowing facilities
The group had an undrawn revolving acquisition facility of £10
million at 31 December 2014.
28
Trade payables
All amounts are short-term (all payable within six months) and their
carrying values are considered reasonable approximations of fair
value. The values are set out in note 19.
Fair value hierarchy
The fair value hierarchy has the following levels:
• Level 1: quoted prices (unadjusted) in active markets for
identical assets or liabilities
• Level 2: inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either
directly (ie as prices) or indirectly (ie derived from prices)
• Level 3: inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
The interest rate swaps and foreign currency hedges are
measured at fair value in accordance with the fair value
hierarchy and are classed as level 2.
Summary of financial assets and financial liabilities by category
Financial Assets
Trade and other receivables
Cash and cash equivalents
Loans and receivables
Financial Liabilities
Derivative financial instruments -
Financial liabilities designated at fair value
through profit or loss
2014)
£000)
2013)
£000)
5,685)
6,130)
11,148) 10,054)
16,833) 16,184)
)
-)
574)
574)
Trade payables
Accruals and deferred income
Other payables
Trade and other payables relating to acquisitions
Current portion of long-term borrowings
Long-term borrowings
Financial liabilities measured at amortised cost
3,617)
3,517)
1,694)
1,875)
336)
509)
1,554)
118)
3,139)
4,043)
9,666) 11,547)
18,824) 22,791)
The derivative financial instruments in respect of the Convertible
Redeemable shares are measured at fair value in accordance with
the fair value hierarchy and are classed as level 2.
Total financial liabilities
Net financial liabilities
Non financial assets and financial liabilities not
within the scope of IAS 39
Property, plant and equipment
Goodwill
Other intangible assets
Inventories
Prepayments and accrued income
Social security and other taxes
Current tax payable
Deferred tax liabilities
Total equity
18,824) 23,365)
1,991)
7,181)
4,695)
4,511)
8,678)
8,678)
8,662) 12,913)
5,824)
6,296)
417)
542)
(428)
(496)
(1,320)
(992)
(2,704)
(1,820)
25,381) 28,075)
23,390) 20,894)
29
31 December 2014
Sterling)
equivalent)
of US$)
£000)
Sterling)
equivalent)
of €)
£000)
Amount of foreign currency hedged
at year-end
)
2,750)
Residual exposure at year-end - short
108)
Impact on pre-tax profits of a 5%
variation in exchange rate on year-end
residual exposure
Impact on equity of a 5% variation
in exchange rate on year-end
residual exposure
)
5)
4)
2,716)
911)
46)
36)
31 December 2013
Sterling)
equivalent)
of US$)
£000)
Sterling)
equivalent)
of €)
£000)
Amount of foreign currency hedged
at year-end
Residual exposure at year-end - long
)
1,000)
2,418)
Impact on pre-tax profits of a 5%
variation in exchange rate on year-end
residual exposure
Impact on equity of a 5% variation
in exchange rate on year-end
residual exposure
121)
93)
1,499)
700)
35)
)
27)
In addition to the hedging of existing measured foreign currency
exposure, the group seeks to mitigate the impact of currency
fluctuations on future trading performance. This was achieved at
31 December 2014 by entering into currency forward contracts
and options to sell €4.1 million and $6.4 million during 2015, at
pre-determined exchange rates. These were over and above the
hedges already in place to cover measured currency exposure
at that date.
The fair value of these financial instruments is an asset of
£101,000, offset by a fair value liability of £73,000 on interest
rate swaps. These transactions have been recognised in these
accounts and are held within other receivables.
28. Financial instruments - continued
Financial assets
The group’s financial assets (which are summarised in note 29
– credit risk) comprise cash and cash equivalents and trade and
other receivables.
• The amounts derived from these assets and included as
interest income in the income statement are £19,000
(2013: £6,000) (see note 10).
• Cash and cash equivalents are principally denominated in
sterling and earn interest at floating rates.
• There is no material difference between the book and fair
values of the financial assets.
• At 31 December 2014 the group had trade receivables
denominated in foreign currency as follows: US$ - £1,239,000
(2013: £1,606,000) and Euros - £726,000 (2013: £655,000).
Financial liabilities
The group’s principal financial liabilities are bank loans, trade and
other payables and derivative financial instruments. The group
also holds interest rate swaps and foreign currency forward
contracts and options:
• The costs attributable to these liabilities and included
as interest expense in the income statement amounted to
£577,000 (2013: £497,000) (see note 10).
• A proportion of the bank loans are denominated in foreign
currencies to provide a hedge against currency risk on group
assets (see note 22). Foreign exchange gains attributable to
bank loans and included as operating income in the income
statement amounted to £34,000 (2013: £127,000 charge).
29. Risk management objectives and policies
The group is exposed to market risks, arising predominantly from
currency exposure resulting from its export activities, interest
rate fluctuation on its loans and deposits and credit and liquidity
risks. Risk management strategies are co-ordinated by the board
of directors of the parent company.
Foreign currency sensitivity
The group exports a substantial proportion of its sales,
frequently denominated in foreign currencies (principally in US$
and Euros). Exposure to currency rate fluctuations exists from
the moment a sales order is confirmed through to the time
when the related remittance is converted into Sterling. This
exposure is computed monthly (along with offsetting exposure
on purchases, generally of minimal amounts) and economically
hedged, predominantly through the use of currency forward
contracts and options. The net exposure to risk is therefore
substantially reduced. This does not however represent a hedge
under IAS 39. Residual exposure is the difference between
the net exposure and the amounts of currency hedges, both
translated into Sterling at each date of measurement.
30
The credit risk for liquid funds and other short-term financial
assets is considered small. The substantial majority of these
assets are deposited with Bank of Scotland, part of the Lloyds
Banking Group. The British Government continues to hold a
significant interest in this group.
Liquidity risk
Longer-term finance is required to enable the group to pursue it
strategic goal of growing through acquisitions as well as through
organic development. This financing need has been satisfied for
the foreseeable future by a newly-secured £10 million revolving
acquisition facility advanced by Lloyds Bank Capital Markets.
The group’s strategy envisages the servicing of this debt to be
achieved from the cash flow arising from the businesses acquired.
For short and medium term financial needs, the group regularly
compares its projected requirements with available cash and
borrowing facilities.
The periods of maturity of the group’s borrowings are set out
in note 22. The maturity of all trade and other payables is within
the period of less than six months.
30. Operating lease commitments
Operating lease payments expensed during the year:
Land and property
Vehicles
Other
Minimum operating lease commitments falling due:
Within one year - Land and property
Within one year - Vehicles
Within one year - Other
Between one and five years - Land and property
Between one and five years - Vehicles
Between one and five years - Other
2014
£000
2013
£000
363
32
6 -
401
328
29
39 -
396
354
36
56 -
446
322
24
346
307
23
330
756
41
797
Total commitment
842
1,127
Interest rate sensitivity
The group’s interest rate exposure arises in respect of its bank
loans, which are LIBOR-linked for interest rate purposes and
its surplus funds, which are bank base-rate-linked. To hedge this
risk the group is party to interest rate swaps at pre-determined
rates. The fair value of these financial instruments has been
recognised in these accounts. The group’s sensitivity to interest
rate changes is as follows:
2014
£000
2013
£000
Unhedged bank loans outstanding at year-end
2,270
1,101
Impact on pre-tax profits of a 1% change in LIBOR
Impact on equity of a 1% change in LIBOR
23
18
11
8
Surplus funds at year-end
11,148
10,054
Impact on pre-tax profits of a 1% change in bank
base rates
Impact on equity of a 1% change in bank base rates
111
87
101
78
Credit risk
The group’s exposure to credit risk is limited to the carrying
amounts of financial assets recognised at the balance sheet date,
as follows:
Cash and cash equivalents
Trade and other receivables
2014
£000
2013
£000
11,148
5,685
10,054
6,130
16,833
16,184
The group reviews the credit risk relating to its customers by
ensuring wherever possible that it deals with long established
trading partners, and agents and government / university
backed bodies, where the risk of default is considered low.
Where considered appropriate, the group insists on up-front
payment and requires letters of credit to be provided. The
directors consider that all the group’s financial assets that are
not impaired at each of the reporting dates under review are of
good credit quality, including those that are past due (see note
18). None of the financial assets are secured by collateral or
other credit enhancements.
Group companies generally trade through overseas agents and
credit exposure to an individual agent can be significant at times.
At 31 December 2014, no counterparty owed more than 10%
of the group’s total trade and other receivables (2013: none).
31
of £1.96 million or more in respect of the twelve month period
to 31 December 2014, reducing by five times any shortfall
below £1.96 million. Half of the earn-out will be paid in cash
and half through the issue of new Ordinary shares in Judges
Scientific plc at a price of 2055p per Ordinary share, based on
the prevailing price of Judges’ Ordinary shares on the day the
headline terms of the acquisition were agreed.
An additional payment will be made to reflect any excess
working capital over and above the ongoing requirements of the
business; the company expects such payment to be covered by
the cash inherited at the completion date. A further payment
capped at £360,000 may become due if the triennial actuarial
valuation of Armfield’s defined benefit pension fund as at
31 March 2017 shows a reduction in the yearly contribution
required to eliminate its funding deficit. The defined benefit
scheme closed to new members with effect from 2001 and
closed to new accrual in 2006.
The acquisition was financed from existing cash resources and
an additional £4 million drawn down from the £10 million
revolving acquisition facility recently agreed with Lloyds Bank
Corporate Markets.
Accounts to the date of completion will be drawn up promptly.
However at the time of finalising these financial statements the
information required under IFRS 3R concerning the acquired net
identifiable assets and liabilities, the fair value of the contingent
consideration and the residual goodwill to be recognised was
not yet available.
31. Prior year acquisition of Scientifica Limited
– contingent consideration
On 26 June 2013 the Company’s wholly owned subsidiary,
Judges Capital Limited, acquired the entire issued share capital
of Scientifica Limited (“Scientifica”). During 2014, Scientifica
reached the profit threshold that triggered the payment of the
maximum deferred consideration due under the terms of the
share purchase agreement. This deferred consideration was
satisfied by the payment during 2014 of £500,000 in cash plus
the issue of 42,372 Ordinary shares in Judges Scientific plc (see
note 24).
Both the cash and share elements of the contingent
consideration were recognised at fair value. The maximum
contingent consideration was assumed in the calculation of fair
value as the best estimate of the amounts payable. The fair
value of the share contingent consideration at acquisition was
based on the mid-market share price on 31 December 2013 of
£20.42, less expected dividends to be paid in the remainder of
the contingent period; this reflected an estimate of a contract
to issue shares at the end of the contingent period. The
movement in the Ordinary share price from 1 January 2014
to the date of issue of the deferred consideration shares has
resulted in a £16,000 increase to the fair value of the contingent
consideration and this movement has been recognised in the
income statement as an exceptional item. The fair value of
£877,000 at the date of issue has been transferred to equity.
32. Post Balance Sheet Event – acquisition of
Armfield Limited
On 22 January 2015, the company acquired the entire issued
share capital of Armfield Limited (“Armfield”). Armfield designs
and markets engineering equipment and research instruments
for educational applications, together with research and
development systems focused on the food, beverage, dairy,
vegetable oils and pharmaceutical industries. The company is
based in Ringwood, Hampshire and New Jersey, USA.
Armfield’s audited accounts for the financial year to
31 December 2013 show revenues of £12.2 million and pre-
tax profits of £1.3 million. The directors believe that, had
the business been owned by the group during that year and
excluding one-off items, Armfield would have generated
operating profits in the order of £1.66 million (before interest,
tax, amortisation of intangible assets and expensed transaction
costs). The audited accounts also show net tangible assets of
£3 million, including cash of £2.56 million.
The acquisition was completed for a cash consideration of
£8.28 million, plus estimated transaction costs of £800,000 and
an earn-out capped at £1.51 million. The maximum earn-out will
be payable if Armfield has generated adjusted operating profits
32
A scanning electron microscopy (SEM) image showing
red palm mites preparing to mate. Prepared using
a Quorum Technologies cryo preparation system in
combination with a Hitachi S-4700 SEM.
The smaller male positions itself under the immature
female and curls up its posterior end for mating.
Image courtesy of Dr. Gary Bauchan and Dr. Ronald
Ochoa, USDA-ARS, Beltsville, MD USA.
INDEPENDENT AUDITOR’S REPORT
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where
the Companies Act 2006 requires us to report to you if, in our
opinion:
•
•
•
adequate accounting records have not been kept by the parent
company, or returns adequate for our audit have not been
received from branches not visited by us; or
the parent company financial statements are not in agreement
with the accounting records and returns; or
certain disclosures of directors’ remuneration specified by law
are not made; or
• we have not received all the information and explanations we
require for our audit.
Other matter
We have reported separately on the consolidated financial statements
of Judges Scientific plc for the year ended 31 December 2014.
Philip Sayers
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
East Midlands
26 March 2015
We have audited the parent company financial statements of Judges
Scientific plc for the year ended 31 December 2014 which comprise
the parent company balance sheet and notes 1 to 13. The financial
reporting framework that has been applied in their preparation is
applicable law and United Kingdom Accounting Standards (United
Kingdom Generally Accepted Accounting Practice).
This report is made solely to the company’s members, as a body, in
accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to
the company’s members those matters we are required to state to
them in an auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility
to anyone other than the company and the company’s members as a
body, for our audit work, for this report, or for the opinions we have
formed.
Respective responsibilities of directors and auditors
As explained more fully in the Statement of Directors’
Responsibilities, the directors are responsible for the preparation
of the parent company financial statements and for being satisfied
that they give a true and fair view. Our responsibility is to audit
and express an opinion on the parent company financial statements
in accordance with applicable law and International Standards on
Auditing (UK and Ireland). Those standards require us to comply
with the Auditing Practices Board’s (APB’s) Ethical Standards for
Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is
provided on the Financial Reporting Council’s website at
www.frc.org.uk/auditscopeukprivate
Opinion on financial statements
In our opinion the parent company financial statements:
•
•
•
give a true and fair view of the state of the company’s affairs as at
31 December 2014;
have been properly prepared in accordance with United Kingdom
Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the
Companies Act 2006.
Opinion on other matter prescribed by the
Companies Act 2006
In our opinion the information given in the Directors’ Report for
the financial year for which the financial statements are prepared is
consistent with the parent company financial statements.
34
PARENT COMPANY BALANCE SHEET
Fixed assets
Tangible assets
Investments in subsidiaries
Current assets
Debtors
Cash in hand and at bank
Creditors: amounts falling due within one year
Net current assets
Total assets less current liabilities
Creditors: amounts falling due after more than one year
Deferred tax liability
Total net assets
Capital and reserves
Called up share capital
Share premium
Capital redemption reserve
Profit and loss account
Shareholders’ funds
Note
3
4
5
6
7
8
9, 10
10
10
10
10
2014)
£000)
3,256)
16,537)
19,793)
15,799)
6,245)
22,044)
(2,630)
19,414)
39,207)
(8,968)
(56) -
30,183)
300)
14,294)
23)
15,566)
30,183)
2013)
£000)
3,318)
16,535)
19,853)
8,694)
4,475)
13,169)
(2,828)
10,341)
30,194)
(3,835)
)
26,359)
293)
14,186)
22)
11,858)
26,359)
In accordance with the exemptions permitted by section 408 of the Companies Act 2006, the profit and loss account of the parent company has not been
presented.
These parent company financial statements were approved by the board on 26 March 2015.
David Cicurel
Director
Ralph Cohen
Director
35
NOTES TO THE PARENT COMPANY
FINANCIAL STATEMENTS
1. General information
These separate financial statements of the parent company
have been prepared under the historical cost convention and in
accordance with applicable United Kingdom Accounting Standards.
2. Accounting policies
2.1 Tangible fixed assets
Property is stated at cost, net of depreciation and any provision
for impairment.
Depreciation is provided at annual rates calculated to write off the
cost less residual value of each asset over its expected useful life at
the following rate:
•
Property: 2% straight-line on cost of buildings (excluding the
estimated value of land).
2.2 Investments
All material equity-settled share-based payments are ultimately
recognised as an expense in the profit and loss account, with a
corresponding credit to “other reserve”.
If vesting periods or other non-market vesting conditions apply,
the expense is allocated over the vesting period, based on the best
available estimate of the number of share options expected to
vest. Estimates are subsequently revised if there is any indication
that the number of share options expected to vest differs from
previous estimates. Any cumulative adjustment prior to vesting
is recognised in the current period. The impact of the revision of
the original estimates, if any, is recognised in the profit and loss
account over the remaining vesting period, with a corresponding
adjustment to the appropriate reserve. No adjustment is made
to any expense recognised in prior periods if share options
ultimately exercised are different to that estimated on vesting.
Upon exercise of share options, the proceeds received net of
attributable transaction costs are credited to share capital and,
where appropriate, share premium.
Fixed asset investments in subsidiaries are stated at cost less
provision for impairment.
2.6 Foreign currencies
2.3 Taxation
Current tax is provided at amounts expected to be paid or
recovered either directly or through group relief arrangements.
Tax assets and liabilities are calculated at rates that are expected
to apply to their respective period of realisation, provided they are
enacted or substantively enacted at the balance sheet date.
2.4 Pensions
The company operates a defined contribution pension scheme
for employees and directors. The assets of the scheme are held
by investment managers separately from those of the company
and group. The pension costs charged against operating results
represent the amount of the contributions payable to the scheme
in respect of the accounting period.
2.5 Share-based payments
FRS 20 has been applied, where the effect is material, to equity-
settled share options granted on or after 7 November 2002 and
not vested prior to 1 January 2006. The Black Scholes valuation
model is used and, up to 31 December 2014, has indicated that no
material adjustment to results is required. The impact of a material
adjustment would be reflected in the accounts of any affected
subsidiary company.
All goods and services received in exchange for the grant of
any share-based payment are measured at their fair values.
Where employees are rewarded using share-based payments,
the fair values of employees’ services are determined indirectly
by reference to the fair value of the instrument granted to the
employee. This fair value is appraised at the grant date and
excludes the impact of non-market vesting conditions.
36
Monetary assets and liabilities denominated in foreign currencies
are translated into Sterling at the rates of exchange prevailing
at the balance sheet date. Transactions in foreign currencies
are recorded at the rate of exchange prevailing at the date
of transaction. All differences are taken to the profit and loss
account.
2.7 Convertible Redeemable shares
In accordance with FRS 25, the Convertible Redeemable shares
have been recorded as a current liability at the net proceeds
received and any future conversion into Ordinary shares has
not been taken into account. The underlying finance cost is not
reflected until conversion takes place. As described in note 25 to
the consolidated financial statements, the Convertible Redeemable
shares were fully converted or redeemed prior to
31 December 2014.
3. Tangible assets
Cost
1 January 2014
Reclassification
31 December 2014
Depreciation
1 January 2014
Charge
31 December 2014
Net book value - 31 December 2014
Net book value - 31 December 2013
Property)
£000)
3,379)
(5)
3,374)
61)
57)
118)
3,256)
3,318)
4.
Investments in subsidiaries
Cost
1 January
Addition
31 December
2014
£000
2013
£000
16,535
2
16,537
16,535
-
16,535
All of the above companies are owned directly by Judges
Scientific plc, with the exception of Aitchee Engineering Limited
and Sircal Instruments (UK) Limited, both of which are owned
directly by Fire Testing Technology Limited, Deben UK Limited,
which is wholly-owned by a 51%-owned intermediate holding
company, Bordeaux Acquisition Limited and Scientifica Limited,
which is owned directly by a wholly-owned intermediate holding
company, Judges Capital Limited.
The addition in the year relates to shares in the company
issued as part of the deferred consideration due on the
acquisition of Scientifica Limited by the company’s subsidiary,
Judges Capital Limited.
5. Debtors
The group’s trading subsidiaries at 31 December 2014, all of
which were incorporated and operate in the United Kingdom,
were as follows:
Amounts owed by group companies
Prepayments and accrued income
Company
Principal activity
Class of shares % held
2014
£000
2013
£000
15,552
247
15,799
8,604
90
8,694
Fire Testing Design and assembly of Ordinary £1
Technology
fire testing instruments
Limited
PE.fiberoptics Design and assembly
of fibre-optic testing
Limited
instruments
100%
“A” Ordinary 50p 100% of “A”
class; being
51% of
total equity
100%
UHV Design Design and manufacture Ordinary £1
of instruments used to
Limited
manipulate objects in
ultra high vacuum
chambers
Manufacture of
Aitchee
engineering parts and
Engineering
finished products
Limited
Quorum
Design, manufacture
Technologies and distribution of
Limited
Ordinary £1
Ordinary £1
instruments that
prepare samples for
examination in electron
microscopes
Design, manufacture Ordinary £1
and distribution of
Sircal
Instruments
(UK) Limited rare gas purifiers for
use in metals analysis
Deben UK Design and manufacture Ordinary £1
Limited
of devices used to enable
or improve the
observation of objects
under a microscope
Global Digital Design and manufacture “A” and “B”
of instruments used to Ordinary £1
Systems
test the physical
Limited
properties of soil
and rocks
Design and manufacture Ordinary £1
of instruments used in
electrophysiology to
enable or improve the
observation of objects
under a microscope
Scientifica
Limited
100%
100%
100%
51%
100%
100 %
Included in amounts owed by group companies are:
•
the sum of £13,846,000 (2013: £6,150,000) which is
repayable on demand at any time after 30 June 2016
provided that all liabilities to third parties falling due on or
before that date have been met; and
a loan to Fire Testing Technology Limited, made during
2010 to finance the acquisition of Sircal Instruments (UK)
Limited, amounting to £1,316,000 at 31 December 2014
(2013: £1,316,000). This loan is unsecured, repayable on
demand and bears interest at the rate of 7.5% per annum.
•
Except as stated, all amounts are recoverable in less than 1 year.
6. Creditors: amounts falling due within one year
Trade and other payables
Amounts owed to group companies
Corporation tax
Accruals and deferred income
Social security and other taxes
Current portion of bank loans
Other creditors
2014
£000
2013
£000
71
-
49
84
155
2,260
11 1
2,630
47
1,162
69
165
121
1,263
2,828
Other creditors include £nil (2013: £521) of non equity shares
classed as financial liabilities (see note 25 to the consolidated
financial statements).
37
7. Creditors: amounts falling due after more than one year
9. Share capital
Bank loans
2014
£000
2013
£000
8,968
3,835
Details relating to the parent company’s share capital are set
out in notes 24 and 25 to the consolidated financial statements.
10. Statement of movements in shareholders’ funds
Share
Share
capital premium
£000
£000
redemption
reserve
Capital Profit and) Total)
loss) share-)
account) holders’)
funds)
£000)
£000)
£000
1 January 2014
293
14,186
22
11,858) 26,359)
Profit for the year
-
-
Shares issued in
the year
Arising on
conversion of
Convertible)
Redeemable shares
Dividends paid in
the year
7
)
-
-
108
-
-
-
-
1
-
4,945)
4,945)
-)
115)
-)
1)
(1,237)
(1,237)
31 December 2014 300
14,294
23
15,566) 30,183)
The profit for the financial year in the accounts of the parent
company amounted to £4,945,000 (2013: £2,868,000).
Details relating to the dividends paid in the year are set out in
note 12 to the consolidated financial statements.
11. Related party transactions
The company is exempt under the terms of FRS 8 from
disclosing transactions with its wholly owned subsidiaries.
Funds were advanced by the company in 2011 to its 51%-
owned subsidiary, Bordeaux Acquisition Limited, to facilitate the
purchase during that year of the entire issued share capital of
Deben UK Limited. The amount of £517,000 was outstanding at
31 December 2014 (2013: £517,000). There are no interest or
repayment terms to these advances.
Dividends paid in the year to directors who hold shares
amounted to £234,000 in aggregate (2013: £196,000).
Borrowings comprise a bank loan secured on assets of the
group. The loan is repayable in quarterly instalments over the
period ending 31 December 2019 and bears interest at 1.75%
to 2.75% above LIBOR-related rates, depending upon gearing.
The repayment profile of borrowings is as follows:
Repayable in less than 1 year
Repayable in years 1 to 5
Less: interest included above
Bank loan
£000
2,471
9,399
11,870
642
11,228
A proportion of the company’s bank loans is drawn in foreign
currencies to provide a hedge against group assets denominated
in those currencies. The Sterling equivalent at
31 December 2014 of loans denominated in Euros was
£466,000 (2013: £499,000). These amounts are included in the
figures above for bank loans, repayable in years 1 to 5.
The company enters into derivative financial instruments
in order to manage its interest rate and foreign currency
exposure. The principal derivatives used include interest rate
swaps and foreign currency forward contracts and options.
The parent company guarantees bank loans advanced to its
51% owned subsidiary Bordeaux Acquisition Limited and to its
wholly owned subsidiary Judges Capital Limited amounting in
aggregate at 31 December 2014 to £1,052,000
(2013: £9,379,000). During 2014, a bank loan to Judges Capital
Limited was replaced by a loan from the parent company.
8. Deferred tax liability
1 January
Charge
31 December
2014
£000
-
56
56
Amounts provided in respect of deferred tax are computed at
20% and relate to accelerated capital allowances.
38
12. Directors and employees
Further details of the transaction are set out in note 32 to the
consolidated financial statements.
Staff costs (including directors)
Wages and salaries
Social security costs
Other pension costs
Total directors’ emoluments
Emoluments
Defined contribution pension
scheme contributors
2014
£000
2013
£000
612
75
10 9
697
540
6
546
674
84
767
592
6
598
Emoluments of the highest paid director
Emoluments
162
184
During the year, one director participated in a defined
contribution pension scheme (2013: one).
Average number of persons employed
Directors
Administrative staff
Total
no.
no.
6
2
8
6
2
8
13. Post Balance Sheet Event
On 22 January 2015, the company acquired the entire issued
share capital of Armfield Limited (“Armfield”). Armfield designs
and markets engineering equipment and research instruments
for educational applications, together with research and
development systems focused on the food, beverage, dairy,
vegetable oils and pharmaceutical industries.
The acquisition was completed for a cash consideration of
£8.28 million, plus estimated transaction costs of £800,000 and
an earn-out capped at £1.51 million. An additional payment
will be made to reflect any excess working capital over and
above the ongoing requirements of the business; the company
expects such payment to be covered by the cash inherited at
the completion date. A further payment capped at £360,000
may become due if the triennial actuarial valuation of Armfield’s
defined benefit pension fund as at 31 March 2017 shows a
reduction in the yearly contribution required to eliminate
its funding deficit. The defined benefit scheme closed to new
members with effect from 2001 and closed to new accrual in
2006. The acquisition was financed from existing cash resources
and an additional £4 million drawn down from the £10 million
revolving acquisition facility recently agreed with Lloyds Bank
Corporate Markets.
39
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the twelfth Annual General Meeting of Judges
Scientific plc (the “Company”) will be held at The Lansdowne Club,
9 Fitzmaurice Place, London W1X 6JD on Wednesday 27 May 2015 at
12 noon for the purpose of dealing with the following business of which
items 7, 8 and 9 are special business.
ORDINARY BUSINESS
1. To receive and adopt the audited financial statements of the Company
for the year ended 31 December 2014, together with the strategic
report, the directors’ report, and the report of the auditor.
2. To re-appoint Hon. Alexander Hambro, who retires by rotation, as a
director.
3. To re-appoint David Barnbrook, who retires by rotation, as a
director.
4. To re-appoint Bradley Ormsby, who was appointed by the board on
3 March 2015, as a director.
5. To approve a final dividend of 14.7 pence per Ordinary share.
6. To re-appoint Grant Thornton UK LLP as auditor to hold office from
the conclusion of this meeting until the conclusion of the next general
meeting at which financial statements are laid before the Company
and to authorise the directors to fix the remuneration of the auditor
for the year ending 31 December 2015.
SPECIAL BUSINESS
To consider and, if thought fit, to pass the following resolutions, as
to the resolution numbered 7 as an ordinary resolution and as to the
resolutions numbered 8 and 9 as special resolutions:
ORDINARY RESOLUTION
7. That the directors of the Company be and are hereby generally and
unconditionally authorised pursuant to section 551 of the Companies
Act 2006 (the “Act”) to allot shares in the Company and to grant
rights to subscribe for or to convert any security into shares in the
Company up to a maximum aggregate nominal amount of £99,936
provided that this authority unless renewed shall expire at the close
of the next Annual General Meeting of the Company, save that the
Company may before such expiry make any offer, agreement or other
arrangement which would or might require shares to be allotted or
rights to subscribe for or convert securities into shares to be granted
after such expiry and the directors of the Company may allot shares
or grant rights to subscribe for or convert securities into shares in
pursuance of such offer, agreement or other arrangement as if the
authority conferred hereby had not expired, this authority to replace
any previous authority which is hereby revoked with immediate effect.
SPECIAL RESOLUTIONS
8. That:
(a) subject to and conditional upon the passing of resolution 7 above,
the directors of the Company be and they are hereby empowered
pursuant to section 570 of the Act to allot equity securities (as
defined for the purposes of section 560 of the Act) for cash,
pursuant to the authority granted by resolution 7 above, as if
section 561(1) of the Act did not apply to any such allotment,
provided that such power shall be limited to:
(i) the allotment of equity securities in connection with a relevant
rights issue or open offer in favour of Ordinary shareholders
where the equity securities attributable to the respective
interests of all Ordinary shareholders are proportionate to
the respective numbers of Ordinary shares held by them
on the record date for such allotment, but subject to such
exclusions as the directors may deem fit to deal with fractional
entitlements or impediments arising under the laws of any
overseas territory or the requirements of any recognised
regulatory body or stock exchange; and
(ii) the allotment (otherwise than pursuant to sub-paragraph (i)
above) of equity securities for cash up to an aggregate nominal
amount of £99,936.
and, unless previously renewed, revoked or varied, such power
shall expire at the close of the next Annual General Meeting of
the Company, save that the Company may before such expiry
make any offer, agreement or other arrangement which would
or might require equity securities to be allotted after such expiry
and the directors of the Company may allot equity securities in
pursuance of such offer, agreement or other arrangement as if the
power conferred hereby had not expired.
(b) For the purposes of this resolution:
(i) “relevant rights issue” means an offer of equity securities
open for acceptance for a period fixed by the directors of the
Company to holders on the register on a fixed record date of
Ordinary shares in the Company in proportion (or as nearly
as may be practicable) to their respective holdings but subject
in any case to such exclusions or other arrangements as the
directors of the Company may deem necessary or desirable
to deal with fractional entitlements or legal or practical
impediments under the laws of any overseas territory or the
requirements of any recognised regulatory body or stock
exchange; and
(ii) the nominal amount of any securities shall be taken to be, in
the case of rights to subscribe for or convert any securities
into shares of the Company, the nominal amount of such
shares, which may be allotted pursuant to such rights.
40
3 To appoint more than one proxy you may photocopy the Form of
Proxy. Please indicate the proxy holder’s name and the number of
shares in relation to which he/she is authorised to act as your proxy
(which, in aggregate, should not exceed the number of shares held by
you). Please also indicate if the proxy is one of multiple instructions
being given. All forms must be signed and should be returned
together in the same envelope.
4 The completion and return of a Form of Proxy will not preclude a
member of the Company from subsequently attending and voting in
person at the meeting should he/she so wish. If you appoint a proxy
and attend the meeting in person, your proxy appointment will
automatically be terminated.
5 Pursuant to Regulation 41 of The Uncertificated Securities Regulations
2001, only those members registered in the Register of Members
of the Company as at 12 noon on 25 May 2015 (being not more
than 48 weekday hours prior to the time fixed for the Meeting)
or, if the Meeting is adjourned, such time being not more than 48
weekday hours prior to the time fixed for the adjourned meeting are
entitled to attend or vote at the meeting in respect of the number
of Ordinary shares registered in their name at that time. Changes
to entries in the Register after that time shall be disregarded in
determining the rights of any person to attend or vote at the meeting.
6
7
In the case of joint holders the vote of the first-named holder on the
Register of Members (whether voting in person or proxy) will be
accepted to the exclusion of the votes of the other joint holders.
In order to facilitate voting by corporate representatives at the
meeting, arrangements will be put in place at the meeting so that (i)
if a corporate shareholder has appointed the chairman of the meeting
as its corporate representative to vote on a poll in accordance
with the directions of all of the other corporate representatives
for that shareholder at the meeting, then on a poll those corporate
representatives will give voting directions to the chairman and the
chairman will vote (or withhold a vote) as corporate representatives
in accordance with those directions; or (ii) any corporation which is
a member can appoint one or more corporate representatives who
may exercise on its behalf all of its powers as a member provided that
they do not do so in relation to the same shares.
9. That the Company be and is hereby generally and unconditionally
authorised for the purpose of section 701 of the Act to make one
or more market purchases (within the meaning of section 693(4)
of the Act) of Ordinary shares of 5 pence each in the capital of the
Company on such terms and in such manner as the directors of the
Company may from time to time determine, provided that:
(a) the maximum aggregate number of Ordinary shares hereby authorised
to be purchased is 898,832 (representing approximately 14.99 per
cent. of the Company’s issued share capital at 31 December 2014);
(b) the minimum price which may be paid for such shares is the nominal
value of 5 pence per Ordinary share (exclusive of expenses);
(c) unless the Company makes market purchases of its own Ordinary
shares by way of a tender or partial offer made to all holders of
Ordinary shares on the same terms, the maximum price (exclusive
of expenses) which may be paid for an Ordinary share shall not be
more than five per cent. above the average of the market values for
an Ordinary share as derived from the AIM Appendix to the London
Stock Exchange Official List for the five business days immediately
preceding the date on which the Ordinary share is purchased;
(d) unless previously renewed, varied or revoked, the authority hereby
conferred shall expire at the conclusion of the next Annual General
Meeting of the Company to be held in 2016 or 15 months from the
date of passing of this resolution, whichever shall be the earlier; and
(e) the Company may validly make a contract or contracts to purchase
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 may make a purchase of
Ordinary shares in pursuance of any such contract or contracts.
By Order of the Board
Chris Talbot
Company Secretary
4 May 2015
Registered Office:
Unit 19, Charlwoods Road
East Grinstead
West Sussex RH19 2HL
Notes:
1 A member entitled to attend, speak and vote at the meeting convened
by the Notice set out above is entitled to appoint one or more
proxies to exercise all or any of your rights to attend, speak and vote
at a general meeting of the Company. A proxy need not be a member
of the Company. A Form of Proxy is enclosed for your use. Please
carefully read the instructions on how to complete the form.
2 To be valid, the instrument appointing a proxy together with any
power of attorney or other authority under which it is signed or
a notarially certified copy of such power or authority, must be
deposited at the registered office of the Company not less than 48
weekday hours before the time fixed for holding the meeting or any
adjournment thereof.
41
A GDS Instruments triaxial cell allows
pressure and load to be applied to soil and
rock samples for the assessment of strength
properties for the civil engineering industry.
Form of Proxy
for the Annual General Meeting of Judges Scientific plc on 27 May 2015 at 12.00 noon at
The Lansdowne Club, 9 Fitzmaurice Place, London W1X 6JD
If you are unable to attend the Annual General Meeting, you may appoint a proxy to exercise all or any of your rights to
attend, speak and vote in your place. A proxy need not be a member of Judges Scientific plc but must attend the meeting to represent
you. A proxy must vote as you have instructed. If you wish to appoint a proxy other than the Chairman of the meeting you may do so by
crossing out the words ‘Chairman of the meeting’ and writing another proxy’s name and address in the space provided. You may appoint
more than one proxy, provided each proxy is appointed to exercise rights attached to different shares. Please indicate for each Resolution
how you wish your proxy to vote by placing a tick in the relevant box. If you do not tell your proxy how to vote, your proxy may vote or
withhold his/her vote as he/she thinks fit on the Resolutions or any other business at the meeting (including amendments to Resolutions).
I/We
of
Chairman of the meeting or
(Block Letters)
appoint the
as my/our proxy in
respect of
attend and, on a poll, to vote on my/our behalf at the Annual General Meeting of Judges Scientific plc to be held at 12.00 noon on
27 May 2015, and at any adjournment(s) of that meeting.
Ordinary shares to
For
Against
Withheld
Vote
1 Approval and adoption of Annual Report and Accounts
2 Re-appointment of Hon Alexander Hambro
3 Re-appointment of David Barnbrook
4 Re-appointment of Bradley Ormsby
5 Approval of final dividend
6 Re-appointment of auditor
7 Authority to allot shares
8 Authority to disapply pre-emption rights
9 Authority to make market purchases
If this proxy is signed by someone else on your behalf, their authority must also be returned with this form. In the case of joint holdings, any
one holder may sign this form. In the case of a corporation, the proxy must be executed under its common seal or under the hand of a duly
authorised officer or attorney. Even if you complete and return this proxy form, you may still attend the meeting and vote in person should
you later decide to do so.
Please sign here:
Date:
Please indicate here with an ‘X’ if this proxy is one of multiple appointments being made.
Please post this form once you have completed it to the address printed overleaf. To be valid, this form must be received no later
than 48 weekday hours before the time fixed for holding the meeting or any adjournment thereof.
Please refer to the notes in the Notice of Meeting to which this proxy relates if you require any assistance.
Any alterations to this form must be initialled.
Mailing address for Form of Proxy
The Company Secretary, Judges Scientific plc, Unit 19, Charlwoods Road
East Grinstead, West Sussex RH19 2HL
Mailing address for Form of Proxy
The Company Secretary, Judges Scientific plc, Unit 19, Charlwoods Road,
East Grinstead, West Sussex RH19 2HL
Fold here
Fold here
COMPANY INFORMATION
Directors
The Hon. Alexander Robert Hambro (Non-Executive Chairman)
David Elie Cicurel (Chief Executive)
David Barnbrook (Chief Operating Officer)
Ralph Leslie Cohen (Non-Executive Director)
Ralph Julian Elman (Non-Executive Director)
Brad Ormsby (Finance Director)
Glynn Carl Reece (Non-Executive Director)
Company Secretary
Ralph Leslie Cohen
Chris Talbot (from 1 May 2015)
Registered Office
Unit 19, Charlwoods Road
East Grinstead
West Sussex RH19 2HL
Registrar
Capita Asset Services
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
Nominated Adviser
Shore Capital and Corporate Ltd
Bond Street House
14 Clifford Street
London W1S 4JU
Stockbroker
Shore Capital Stockbrokers Ltd
Bond Street House
14 Clifford Street
London W1S 4JU
Auditor
Grant Thornton UK LLP
Statutory Auditor
Chartered Accountants
Regent House
80 Regent Road
Leicester LE1 7NH
Principal Bankers
Lloyds Bank Corporate Markets
125 Colmore Row
Birmingham B3 3SF
Solicitors
Hogan Lovells International LLP
Atlantic House
Holborn Viaduct
London EC1A 2FG
Registered in England and Wales, Company No. 4597315
Judges Scientific plc
Judges Scientific plc
Unit 19, Charlwoods Road
East Grinstead
West Sussex RH19 2HL
01342.323600
Tel:
01342.323608
Fax:
Website: www.judges.uk.com
E-mail: enquiries@judges.uk.com