Logistics Development Group plc
Annual Report and Accounts for the year ended 30 November 2021
Table of contents
Strategic Report
Letter from Chairman
(cid:149)
(cid:149) Business and Financial review
(cid:149) Risk management and principal risks
The Board of Directors
Governance
(cid:149)
(cid:149) Chairman’s governance statement
(cid:149)
(cid:149) Audit Committee report
(cid:149) Remuneration committee report
(cid:149) Directors’ report
(cid:149)
The Board
Statement of Directors' responsibilities in respect
of the financial statements
Independent Auditor’s report
Financial Statements
(cid:149) Company Statement of Comprehensive Income
(cid:149) Company Statement of Financial Position
(cid:149) Company Statement of Changes in Equity
(cid:149) Company Cash Flow Statement
(cid:149) Notes to the Company Financial Statements
(cid:149) Glossary
(cid:149) Advisors
1
3
8
10
11
13
15
17
19
21
22
29
30
31
32
33
42
44
Strategic Report
Letter from Chairman
Dear Shareholders
I am pleased to present the annual report and the audited financial statements for Logistics Development Group
b^U ’rDda_ fZW Ua_T[‘Sf[a‘ aX DJKs(+
The Financial Statements are presented in pounds sterling, rounded to the nearest thousand, unless otherwise stated.
As at 30 November 2021, the Company has no subsidiaries and, as such, no consolidated financial statements have
been presented. The Financial Statements therefore present Company only information for the current and comparative
periods.
The Financial Statements were prepared under the historical cost convention, except for financial assets recognised at
fair value through profit or loss, which have been measured at fair value. The Company is not registered for VAT and
therefore all expenses are recorded inclusive of VAT.
Significant holdings in undertakings other than subsidiary undertakings
As at 30 November 2021 the Company had a significant holding in Marcelos Limited ’rESdUW^aes(, incorporated in the
Isle of Man. Marcelos has 100 £1 ordinary shares in issue, of which the Company held 49 shares. Its registered address
is First Names House, Victoria Road, Douglas, Isle of Man IM2 4DF.
Going concern
The Directors have a reasonable expectation that the Company has sufficient resources to continue in operation for the
foreseeable future, a period of at least 12 months from the date of this report. The Directors have prepared a cash flow
forecast for a period of 3 years which indicates that available funds significantly exceed anticipated expenditure.
Consequently, the Directors of the Company continue to adopt the going concern basis of accounting in preparing the
annual financial statements.
2. Significant accounting policies
(a) Investments in associates - associates are all entities over which the Company has significant influence but not
control or joint control. Investments in associates are initially recognised at fair value and subsequently measured at fair
value through profit or loss.
(b) Fair value measurement q fZW XS[d hS^gW _WSegdW_W‘f aX fZW ;a_bS‘kue [‘hWef_W‘fe gf[^[eWe _Sd]Wf aTeWdhST^W
inputs and data as far as possible. Inputs used in determining fair value measurements are categorised into different
^WhW^e TSeWV a‘ Zai aTeWdhST^W fZW [‘bgfe geWV [‘ fZW hS^gSf[a‘ fWUZ‘[cgW gf[^[eWV SdW ’fZW tXS[d hS^gW Z[WdSdUZku(7
- Level 1: Quoted prices in active markets for identical items (unadjusted);
- Level 2: Observable direct or indirect inputs other than Level 1 inputs;
- Level 3: Unobservable inputs (i.e. not derived from market data and may include using multiples of trading results or
information from recent transactions).
The classification of an item into the above levels is based on the lowest level of the inputs used that has a significant
effect on the fair value measurement of the item. Transfers of items between levels are recognised in the period they
occur.
(c) Financial instruments
- Financial assets q other receivables and amounts owed to related undertakings. Such assets are recognised initially at
fair value plus any directly attributable transaction costs. Subsequent to initial recognition, such assets are measured at
amortised cost using the effective interest method, less any impairment losses.
- Cash and cash equivalents q in the Statement of Financial Position, cash includes cash and cash equivalents excluding
bank overdrafts. No expected credit loss provision is held against cash and cash equivalents as the expected credit loss
is negligible.
33
Logistics Development Group plc
Notes to the Company Financial Statements (continued)
for the year ended 30 November 2021
2. Significant accounting policies
(c) Financial instruments (continued)
- Financial liabilities q other payables and amounts owed to related undertakings. Such liabilities are initially recognised
on the date that the Company becomes party to contractual provisions of the instrument. The Company derecognises a
financial liability when its contractual obligations are discharged, cancelled or expire. Such financial liabilities are
recognised initially at fair value less any directly attributable transaction costs. Subsequent to initial recognition, these
financial liabilities are measured at amortised cost using the effective interest method.
- Share capital q Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary
shares are recognised as a deduction from equity, net of any tax effects.
(d) Exceptional items q items that are material in size or nature and non-recurring are presented as exceptional items
in the Statement of Comprehensive Income. The Directors are of the opinion that the separate recording of exceptional
items provides helpful information abagf fZW ;a_bS‘kue g‘VWd^k[‘Y Tge[‘Wee bWdXad_S‘UW+ =hW‘fe iZ[UZ _Sk Y[hW d[eW
to the classification of items as exceptional include restructuring of business units and the associated legal and employee
costs, costs associated with business acquisitions, impairments and other significant gains or losses.
(e) Alternative performance measures (APMs) - APMs, such as underlying results, are used in the day-to-day
management of the Company, and represent statutory measures adjusted for items which, in the Directodeu h[Wi) Uag^V
influence the understanding of comparability and performance of the Company year on year. These items include non-
recurring exceptional items and other material unusual items.
(f) Tax q tax expense comprises current and deferred tax. Current tax and deferred tax are recognised in profit or loss
except to the extent that it relates to items recognised directly in equity or in other comprehensive income. Deferred tax
assets are recognised only to the extent that it is probable that future taxable profit will be available against which the
temporary differences can be utilised.
(g) Operating segments q the Company has a single operating segment on a continuing basis, namely investment in a
portfolio of assets.
(h) Fund raise costs q transaction costs incurred in anticipation of an issuance of equity instruments are recorded as a
deduction from the retained earnings reserve in accordance with IAS 32 and the Companies Act 2006.
(i) Own shares reserve q transfer of shares from the trust to employees is treated as a realised loss and recognised as
a deduction from the retained earnings reserve.
New and amended standards adopted by the Company
There are no IFRS standards or IFRIC interpretations that are mandatory for the year ended 30 November 2021 that
have a material impact on the financial statements of the Company.
34
Logistics Development Group plc
Notes to the Company Financial Statements (continued)
for the year ended 30 November 2021
2. Significant accounting policies (continued)
Critical judgements in applying the Company’s accounting policies
A‘ Sbb^k[‘Y fZW ;a_bS‘kue SUUag‘f[‘Y ba^[U[We) fZW <[dWUfade ZShW _SVW fZW Xa^^ai[‘Y \gVYW_W‘fe fZSf ZShW fZW _aef
significant effect on the amounts recognised in the financial statements (apart from those involving estimations, which
are dealt with below) and have been identified as being particularly complex or involve subjective assessments.
(i) Measurement of the investments q during the prior year, the Company elected to measure its investment in Marcelos,
the intermediate holding company of the GWSA Group, at fair value through profit and loss. The election is taken on the
TSe[e aX fZW [‘hWef_W‘f TW[‘Y S thW‘fgdW USb[fS^u [‘hWef_W‘f g‘VWd A9K /5 tA‘hWef_W‘fe [‘ 9eeaU[SfWe S‘V Ba[‘f NW‘fgdWeu+
The strategy of the Company as an Investing Company is to generate value though holding investments for the short to
medium term. Therefore, the Directors believe that the fair value method of accounting for the investments is in line with
the strategy of the Company.
Had the election not been made, the investment in Marcelos would have been subject to equity accounting that involves
recognition of the investment at cost and subsequent measurement at cost plus a share of profits and losses of the
GWSA Group, less dividends received.
(ii) Fair value of the investments q the Directors have recorded the investment in Marcelos at fair value. The fair value
at the period end was calculated on the basis of the net assets of Marcelos, and represents the guaranteed expected
future cashflows relevant to the Company. The fair value at the prior period end was calculated on the basis of the market
capitalisation of the Company, which was considered to be the most suitable valuation methodology as at 30 November
2020. The Directors reviewed other valuation metrics such as peer group trading multiples. Based on these metrics the
valuation was justifiable, albeit at the lower end of the range of possible values. The Directors believed that this valuation
approach represented the price of the Company that would be received in an orderly transaction between market
participants.
Key sources of estimation in applying the Company’s accounting policies
The Directors believe that there are no key assumptions concerning the future, and other key sources of estimation
uncertainty at the balance sheet date that have a significant risk of causing a material adjustment to the carrying amounts
of assets and liabilities within the next financial year.
35
Logistics Development Group plc
Notes to the Company Financial Statements (continued)
for the year ended 30 November 2021
3. Alternative performance measures reconciliations
Alternative performance measures (APMs), such as underlying results, are used in the day-to-day management of the Company,
S‘V dWbdWeW‘f efSfgfadk _WSegdWe SV\gefWV Xad [fW_e iZ[UZ) [‘ fZW <[dWUfadeu h[Wi) Uag^V influence the understanding of comparability
and performance of the Company year on year. The reconciliation of APMs to the reported results is detailed below:
Profit/(Loss) before tax
Exceptional income
Underlying EBIT
Weighted average number of Ordinary Shares q Basic
Weighted average number of Ordinary Shares q Diluted
Underlying Basic earnings/(loss) per share for total operations
Underlying Diluted earnings/(loss) per share for total operations
4. Employees and Directors
2021
£’000
84,655
90
84,565
2020
nu---
(7,899)
3,415
(11,314)
2021
(in
thousands)
702,206
2020
(in
thousands)
379,347
702,206
379,347
12.0p
12.0p
(3.0p)
(3.0p)
Staff costs and the average number of persons (including Directors) employed by the Company during the year are detailed below:
Staff and Director costs for the Company during the year
Wages and salaries
Social security costs
Average monthly number of employees and Directors
Employees and Directors
9 eg__Sdk aX <[dWUfadeu dW_g‘WdSf[a‘ ’]Wk _S‘SYW_W‘f bWdea‘‘W^( [e VWfS[^WV TW^ai7
Emoluments, bonus and benefits in kind
Total Directors’ remuneration
Remuneration of the highest paid Director is detailed below:
Emoluments, bonus and benefits in kind
5. Exceptional items
2021
£’000
250
19
269
4
2021
£’000
194
194
2021
£’000
93
2020
nu---
292
26
318
4
2020
nu---
245
245
2020
nu---
64
During the year, the Company recognised exceptional income in relation to a VAT refund of £90,000 associated with the disposal
of GWSA.
During the prior year, the Company recognised exceptional income in relation to reimbursed transaction costs of £2,845,000
associated with the disposal of GWSA and 2019-related audit fees of £570,000. The costs were incurred by the Company in 2019
and ultimately borne by GWSA upon completion of the transaction in accordance with deal arrangements.
36
Logistics Development Group plc
Notes to the Company Financial Statements (continued)
for the year ended 30 November 2021
6. Audit fees
WWe bSkST^W Xad fZW SgV[f aX fZW ;a_bS‘kue S‘‘gS^ X[‘S‘U[S^ efSfW_W‘fe
Audit-related assurance services
Other assurance services (fund raise expenses)
LafS^ XWWe bSkST^W fa ;a_bS‘kue SgV[fade
7. Income tax charge
2021
£’000
119
-
-
119
2020
nu---
114
96
554
764
The Company did not recognise current and deferred income tax charge or credit (2020: nil). In 2021, the deferred tax asset of
£412,050 (2020: £219,000) was not recognised as the Directors do not consider that there is sufficient certainty over its recovery.
The underlying tax losses can be carried forward indefinitely.
The income tax charge for the year included in the statement of comprehensive income can be reconciled to loss before tax
multiplied by the standard rate of tax as follows:
Profit/(loss) before tax
Expected tax charge/(credit) based on a corporation tax rate of 19%
(2020: 19%)
Effect of expenses not deductible in determining taxable profit
Effect of income not taxable in determining taxable profit
Unused tax losses for which no deferred tax asset has been recognised
Effect of a change in future corporation tax rate on the deferred tax asset
Income tax charge
2021
£’000
84,655
16,084
98
(16,276)
94
-
-
2020
nu---
(7,899)
(1,501)
1,282
-
219
-
-
The current effective UK corporation tax rate for the financial year is 19%. The UK corporation tax rate will remain at 19% until 31
March 2022. On 3 March 2021, it was announced that the main rate of corporation tax will increase to 25% from 1 April 2023. As
a result, the deferred tax asset has been calculated using the 25% rate.
8. Dividends
At the date of approving these Financial Statements, no final dividend has been approved or recommended by the
Directors (2020: £Nil).
37
Logistics Development Group plc
Notes to the Company Financial Statements (continued)
for the year ended 30 November 2021
9. Earnings per share
Basic earnings per share amounts are calculated by dividing profit/(loss) for the period attributable to ordinary equity holders of the
Company by the weighted average number of ordinary shares outstanding during the 12 months to the period end.
Diluted earnings per share amounts are calculated by dividing the profit/(loss) attributable to ordinary equity holders of the Company
by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary
shares that would be issued on conversion of all the potentially dilutive instruments into ordinary shares. The Company has no
dilutive instruments to be included in the calculation.
Profit/(loss) attributed to equity shareholders
Weighted average number of Ordinary Shares q Basic
Weighted average number of Ordinary Shares q Diluted
Basic earnings/(loss) per share for total operations
Diluted earnings/(loss) per share for total operations
10. Investments at fair value through profit or loss
2021
£’000
84,655
2021
(in
thousands)
702,206
702,206
12.1p
12.1p
2020
nu---
(7,899)
2020
(in thousands)
379,347
379,347
(2.1p)
(2.1p)
1 December 2019
Disposals during the year
Additions during the year
Change in fair value
30 November 2020
Additions during the year
Change in fair value
Dividends
30 November 2021
GreenWhiteStar
Acquisitions
Limited
£’000
Alpha Persei
Limited
£’000
Marcelos
Limited
£’000
Total
investments
£’000
45,000
(45,000)
-
-
-
-
-
-
-
-
-
-
-
-
6,000
287
(6,287)
-
-
-
45,000
(9,152)
35,848
-
85,378
(119,008)
2,218
45,000
(45,000)
45,000
(9,152)
35,848
6,000
85,665
(125,295)
2,218
During the year, the Company acquired for £6.0 million a 10.9% equity interest in Alpha Persei Limited which held an 18% PIK Loan
note with indirect exposure to the performance of GWSA.
During the year, the Company announced the disposal of its interest in GWSA Group, held through its investments in Marcelos and
ESdUW^aeu iZa^^k ai‘WV egTe[V[Sdk 9^bZS ;See[abW[SW D[_[fWV+
The disposal resulted in the Company receiving a dividend of £6,287,000 from Alpha Persei Limited and a dividend of £119,008,000
from Marcelos. These dividends were considered to be a return of capital and have been offset against the carrying value of the
investment.
As at 30 November 2021, the Company's investment in Marcelos was revalued to £2,218,000 as a result of a dividend proposed to
be paid to the Company from Marcelos during the next financial year.
38
Logistics Development Group plc
Notes to the Company Financial Statements (continued)
for the year ended 30 November 2021
11. Financial assets and liabilities
Financial assets at fair value through the profit or
loss
Investments in associate (see note 10)
Financial assets at amortised cost
Other receivables
Total financial assets
Financial liabilities at amortised cost
Amounts owed to related undertakings (see note 13)
Other payables
Total financial liabilities
Cash and cash equivalents
Net funds
2021
£’000
2020
nu---
2,218
35,848
114
2,332
-
(290)
(290)
131,902
131,902
28
35,876
(1,235)
(2,184)
(3,419)
652
652
All financial assets and liabilities mature within one year. The fair value of those assets and liabilities approximates their book value.
Other receivables represent prepayments. Other payables include accruals of £216,000 (2020: £2,122,000 with £1,369,000 relating
to the accrued fund raise costs).
LZW ;a_bS‘kue ahWdS^^ d[e] _S‘SYW_W‘f bdaYdS__W XaUgeWe a‘ dWVgU[‘Y X[‘S‘U[S^ d[e] Se XSd as possible and therefore seeks to
_[‘[_[eW bafW‘f[S^ SVhWdeW WXXWUfe a‘ fZW ;a_bS‘kue X[‘S‘U[S^ bWdXad_S‘UW+ LZW ba^[U[We S‘V efdSfWY[We Xad _S‘SY[‘Y ebWU[X[U
financial risks are summarised as follows:
Liquidity risk
The Company finances its operations by equity. The Company undertakes short-term cash forecasting to monitor its expected cash
flows against its cash availability. The Company also undertakes longer-term cash forecasting to monitor its expected funding
requirements in order to meet its current business plan.
Credit risk
LZW ;a_bS‘kue bd[‘U[bS^ WjbaegdW fa UdWV[f d[e] [e [‘ fZW S_ag‘fe aiWV Tk dW^SfWV g‘VWdfS][‘Ye. There are no related undertakings
in the current year.
Capital management
Capital comprises share capital of £7.0m (2020: £3.8m) and share premium of £157.5m (2020: £146.0m).
39
Logistics Development Group plc
Notes to the Company Financial Statements (continued)
for the year ended 30 November 2021
12. Capital and reserves
Ordinary shares of 1p each in issue at 30 November 2020
Ordinary shares of 1p each in issue at 30 November 2021
No of
shares
‘000
379,347
702,206
Called up
share
capital
£’000
3,793
7,022
Share
premium
account
£’000
146,002
157,477
All of the ordinary shares in issue referred to in the table above were authorised and are fully paid.
During the prior year, costs in relation to the fund raise of £1.5m in December 2020 were deducted from the retained earnings
reserve. During the year, these costs were reclassified from retained earnings to be offset against share premium.
Own treasury shares
Included in the total number of ordinary shares outstanding above are 535,440 (2020: 1,634,304) ordinary shares held by
the Company's employee benefit trust. The ordinary shares held by the trustee of the Company's employee benefit trust pursuant
to the SIP SdW fdWSfWV Se Gi‘ eZSdWe [‘ fZW ;a_bS‘kue :S^S‘UW KZWWf [‘ SUUadVS‘UW i[fZ IAS 32. During the year, 1,098,864
(2020: 55,696) shares were transferred to employees of the GWSA Group.
13. Related party transactions
During the year, the Company settled the amount due to related party GWSA as at the prior year end, for the value £1,235,000.
The Company did not enter into any other related party transactions.
During the prior year, from the date of the disposal of the investment in its subsidiary, GWSA, the Company entered into commercial
transactions with GWSA as follows:
9 December 2019
Purchases from related parties
Reimbursement from related parties
30 November 2020
14. Capital commitments
Amounts owed to related parties
£’000
-
385
850
1,235
At 30 November 2021, the Company had no commitments (2020: £Nil).
15. Contingent liabilities
At 30 November 2021, the Company had no contingent liabilities (2020: £Nil).
16. Subsequent events
On 14 January 2022, the Company received a dividend from Marcelos Limited of £2,218,000.
Fa^^ai[‘Y eZSdWZa^VWdeu SbbdahS^ Tk S ebWU[S^ dWea^gf[a‘ a‘ 0. BS‘gSdk /-//) fZW ;agdf SbbdahWV S dWVgUf[a‘ aX fZW ;a_bS‘kue
share premium on 22 February 2022 of £157,477,000 to distributable reserves. The distributable reserve will allow the Company to
proceed with an on-market purchase of up to 20% aX fZW ;a_bS‘kue [eegWV eZSdW USb[fS^.
On 10 March 2022, the Company announced that it had acquired 1,000,000 ordinary shares in Caretech Holdings PLC at £6.335
per share, for a total consideration of £6.3m. This was its first investment since becoming an Investing Company and is consistent
with its investing policy as amended after the General Meeting held on 31 January 2022.
40
Logistics Development Group plc
Notes to the Company Financial Statements (continued)
for the year ended 30 November 2021
16. Subsequent events (continued)
On 1 April 2022, the Company announced that it had acquired a further 974,130 shares in Caretech Holdings Plc at an average
price of £6.95 per share, for a total consideration of £6,769,069.
41
GLOSSARY
Term
Definition
Accounts
Admission
AGM
AIM
AIM Rules
The financial statements of the Company
The admission of the issued ordinary shares in the Company admitted to trading on AIM that became
effective on 31 December 2020
Annual general meeting of the Company
Alternative Investment Market of the London Stock Exchange
The AIM Rules for Companies published by the London Stock Exchange from time to time (including,
without limitation, any guidance notes or statements of practice) which govern the rules and responsibilities
of companies whose shares are admitted to trading on AIM
AIM Investing Company
An Investing Company as defined by the AIM rules.
APMs
Board
CAGR
CGU
Company
DBAY
Alternative Performance Measures
The Board of Directors of the Company
Compound annual growth rate
Cash Generating Unit
Logistics Development Group plc, a public limited company incorporated in England and Wales with
registered number 08922456
DBAY Advisors Limited and/or any fund(s) or entity(ies) managed or controlled by DBAY Advisors
Limited as appropriate in the relevant context
DBAY Transaction
On 9 December 2019 DouglasBay Capital III Fund LP, a fund managed by DBAY Advisors Limited
completed the acquisition of an indirect 51% equity stake in GreenWhiteStar Acquisitions Limited.
Directors
EBITDA
The Directors of the Company as at the date of this document, as identified on page 10
Earnings before interest, tax, depreciation and amortisation
Eddie Stobart Businesses
Eddie Stobart, The Pallet Network, iForce, Eddie Stobart Europe and The Logistics People
EPS
FY20
FY21
GWSA
Earnings per share
Financial Year ended 30 November 2020
Financial Year ended 30 November 2021
GreenWhiteStar Acquisitions Limited, the operational holding company of the Eddie Stobart trading
entities; Eddie Stobart Limited, iForce Limited, The Pallet Network Limited and The Logistic People
Limited.
GWSA Group
GreenWhiteStar Acquisitions Limited and all of its subsidiaries from time to time
HY20
HY21
IAS
IFRS
Six month period ended 31 May 2020
Six month period ended 31 May 2021
International Accounting Standards
International Financial Reporting Standards
Investment Management Agreement
An investment management agreement entered into between the Company and DBAY, pursuant to
iZ[UZ <:9Q ZSe TWW‘ Sbba[‘fWV Se fZW ;a_bS‘kue [‘hWef_W‘f _S‘SYWd
Investing Policy
LZW ;a_bS‘kue [‘hWef[‘Y ba^[Uk _adW bSdf[Ug^Sd^k eWt out on pages 6 and 7
LTIP
Marcelos
The Long Term Incentive Plan
Marcelos Limited, a company incorporated on the Isle of Man (company no. 016829v), whose registered
office is at First Names House, Victoria Road, Douglas, Isle of Man, IM2 4DF
42
Ordinary Shares/Shares
Ordinary shares of £0.01 each in the capital of the Company
PIK Loan note
PWC
QCA
Loan of £55m used to effect the DBAY transaction, which carries interest at 18% compounding
quarterly, maturing in November 2025.
PricewaterhouseCoopers LLP - tZW ;a_bS‘kue SgV[fads
Quoted Companies Alliance
QCA Governance Code
QCA Corporate Governance Code for Small and Mid-Size Quoted Companies published by the QCA
SIP
Share Incentive Plan
43
Advisors
Registrars for Logistics Development Group plc
Link Asset Services
The Registry
34 Beckenham Road
Beckenham
Kent
BR3 4TU
Nomad
Strand Hanson Limited
26 Mount Row
London
W1K 3SQ
Broker
Investec plc
30 Gresham Street
London
EC2V 7QP
Independent Auditors
PricewaterhouseCoopers LLP
No 1 Spinningfields
1 Hardman Square
Manchester
M3 3EB
Solicitors
Fladgate LLP
16 Great Queen Street
London
WC2B 5DG
Public Relations
FTI Consulting
200 Aldergate Street
London
EC1A 4HD
44