Report and Accounts
FULL RESULTS FOR THE YEAR ENDED 30 JUNE 2024
Summary Information
1
Strategic Report
Chairman’s Statement
3
Strategy and Performance
6
1. The Group’s Strategy
6
2. The Business Model
7
3. Key Performance Indicators (KPI’s)
8
4. Performance Review
9
5. Financial Review and Position
9
6. Principal Risks and Uncertainties
10
7. Future Prospects
11
8. Events after the reporting period
11
Governance Report
Report of the Directors
15
Report to Shareholders by the
Board on Directors Remuneration
17
Corporate Governance
19
Statement of Directors’ Responsibilities
25
Directors and Advisers
26
Report of the Independent Auditor
28
Financial Statements
Statement of Comprehensive Income
35
Statements of Changes in Equity
36
Statements of Financial Position
38
Statements of Cash Flows
40
Notes to the Financial Statements
42
Mission
Be the most proactive,
specialist AV & IT distributor,
delivering exceptional
service for our partners.
Vision
To create the industry’s
best customer experience,
through unrivalled passion,
dedication, and expertise.
Values
We Win as a Team.
We Raise the Bar.
We are Trusted Experts.
We are Customer Obsessed.
We are passionate
about technology
and delivering the
very best experience
for our customers.
Experts in
Technology
Distribution
Summary
Information
Northamber plc and its
subsidiaries are primarily
distributors of computers,
peripheral equipment and
related services to resellers who
then sell on to the general public
and corporations – the end users.
The company’s shares are listed on AIM, a market
operated and regulated by the London Stock Exchange
under stock symbol “NAR”.
2024
£’000
2023
£’000
2022
£’000
2021
£’000
2020
£’000
Revenue
56,008
67,149
66,260
60.009
52,835
Gross Margin
8,039
8,906
8,469
7,809
5,478
Gross Margin %
14.4
13.3
12.8
13.0
10.4
(Loss)/Profit before tax
(1,329)
(411)
(447)
385
9,925
(Loss)/Earnings per share
(4.85)p
(1.51)p
(1.64)p
1.24p
31.16
Net Assets per share
82p
87.7p
89.8p
92.1p
91.5p
Dividends paid per share (net)
0.6 p
0.6 p
0.7p
0.6p
0.2p
Northamber Report and Accounts 2024
1
Strategic
Report
In this section
Chairman’s Statement
3
Strategy and Performance
6
1. The Group’s Strategy
6
2. The Business Model
7
3. Key Performance Indicators (KPI’s)
8
4. Performance Review
9
5. Financial Review and Position
9
6. Principal Risks and Uncertainties
10
7. Future Prospects
11
8. Events after the reporting period
11
2
2
Northamber Report and Accounts 2024
Chairman’s Statement
Alexander Phillips
Chairman
Revenue (£’000)
£56,008
2023: 67,149
Gross Margin (%)
14.4%
2023: 13.3
Results
During the year under
review, Northamber
took significant, exciting
strategic strides forward
that position the Group for
a strong mid and long term
performance, albeit the
financial performance was
disappointing.
Our continued focus on sustainable and
healthy gross margin business yielded
a record gross profit percentage of
14.4%, up from 13.3% for the prior year
and continuing a trend of 3 years of
gross margin increases. Some of this
gross margin increase came as a result
of exiting non-strategic commodity
business which, when combined
with a challenging macro-economic
background resulted in a drop in
revenue. The gross margin increase
was also supported by the acquisition
of leading UC&C distributor Tempura
Communications Group at the end of
April 2024 which was margin accretive
and should support further healthy
Group gross margins for the long
term, with a more significant impact
expected in the current financial year,
its first full year of contribution.
Unfortunately, the revenue declines in
the first half of FY2024 continued into
the second half and overall revenue
declined year on year from £67 million
to £56 million (a 16% decline) as market
challenges continued. The gross profit
for the period declined £0.9m to £8m (a
9.7% decline).
During H2 FY2024 we maintained our
market share position on key vendors
and remain number 1 or number 2 for
most of our key supplier franchises.
We are therefore confident that as the
market recovers from the continued
economic downturn we will be in a
strong position to capitalise on this.
Our focus will remain on working with
suppliers who offer a strong gross profit
and strategic fit where we can add and
capture value.
Northamber Report and Accounts 2024
3
Strategic Report
Governance Report
Financial Statements
Following a change in management,
we did initiate a number of strategies
aimed at stimulating sales, but as these
did not deliver the anticipated benefits,
the Board took steps to re-balance the
approach taken.
In addition, the Board made key
strategic decisions to provide a
strong foundation for sustainable and
profitable growth from the current year
onwards, including:
• The acquisition of the Tempura
Communications Group, a leading
Value-Add UC&C distributor based
in Basingstoke, with a strong services
experience and a presence in the
Netherlands and Ireland which will
enable us to grow our European
presence. We have already invested
in a sales team in the Netherlands
and already have several leading
franchises interested in partnering
with us.
• The launch of a new ERP systems
launched in the original Northamber
trading business which encompasses
all processes of the organisation
from logistics to administration and
sales. As is often the case with a new
ERP system this had an impact on
the business during transition but we
see this new system as key to driving
efficient scalability.
The ERP system roll out continued into
the second half of the year with a new
webstore which should also help us
improve our customer experience for
customers who prefer to procure online.
We remain committed to a proactive,
people-centric business model
where we provide a flexible, value
add approach but want to allow our
customers to procure as they prefer.
We have also launched a CSOP share
option scheme for all employees in
the business; we see this as a strong
mechanism for both rewarding our
employees who play a key role in the
value of our business as well as firmly
aligning shareholder and employee
interests by focusing all the team on
shareholder value.
There were a number of exceptional
costs tied to these and other changes
totalling £387k, including £104k of
exceptional recruitment or termination
costs, £283k of acquisition and related
costs. Our continued investment in
improving and automating processes
resulted in IT costs increasing to £231k
up from £157k in the prior year.
After allowing for these exceptional
costs combined with the reduction in
Gross Profit this resulted in an adjusted
EBTDA loss of £396K vs £3K profit on
EBTDA for the prior year.
Shortly after the start of the current
financial year, we announced
the acquisition of Renaissance
Contingency Services Limited, a
value-add distributor of cyber security
solutions and services in Ireland which
as previously reported will:
• build on Northamber’s almost 30
year heritage in Cyber Security; a
core strategic focus area for the
Group
• provide European expansion,
especially into the Irish market,
following the recent acquisition of
Tempura Communications which
has an Irish and Dutch Subsidiary;
• provide strong cross selling
opportunities in Ireland with an
enhanced offering in audio-visual,
unified communications, and cyber
solutions and services; and
• be value enhancing in the first full
year of ownership (FY25), before
consideration of potential synergies,
with an expectation that it will
be earnings enhancing from the
second year of ownership (FY26)
Financial position
We remain diligent in managing
our balance sheet; whilst we have
taken some debt we have done this
in a flexible manner through invoice
discounting to allow us to complete
acquisitions and react to opportunities.
Cash reserves reduced from £5.5 million
at 30 June 2023 to £4.7 million at 30
June 2024, due mainly to the acquisition
of Tempura Communications for £3.3
million of cash with a further deferred
consideration of £2.64 million based
on performance over the next 3 years.
The group has drawn £2.8 million of its
invoice discounting facility. With Net
Assets at £22.4 million, including two
freehold properties, the Group’s overall
financial position remains very sound.
Group stock levels remained consistent
at £11.8 million, up from £11.4 million
the prior year albeit the £11.8 million
includes the stock from Tempura
Communications as well. Like for like
stock levels reduced to £8.7 million.
Net Assets at 82p per share are
considerably in excess of the average
price of the ordinary shares throughout
the period.
Dividend
The Board is proposing a final dividend
of 0.3p, at a total cost of £82,240. The
dividend will be paid on 17 January 2025
to shareholders on the register as at 13
December 2024.
Staff
Our staff remain a key asset for the
business and an area we continue to
invest in. The team has continued to work
hard to support our partners and each
other. Our plans remain to continue to
invest in our evolving business model by
continuing to invest in building out the
best team in the market to achieve our
business evolution.
Chairman’s Statement continued
4
Northamber Report and Accounts 2024
Outlook
Following the period end, we have had
a number of changes coming into
effect. These include
• Acquisition of leading Irish
cybersecurity value-add distributor
- Renaissance Contingency Services
Limited
• Investment in developing a Group
wide services business under the
Avail brand name that will unite
expertise across Group companies
in our AV, UC, Cyber security offerings
and offer a consistent growth
framework.
•
A significant cost reduction exercise
targeting £750,000 of annualised
savings within Northamber Plc which
will start to take effect from January
2025, with initial benefits seen in
the current financial year, before
becoming more fully realised in FY2026.
• Restructure of the senior
management team.
We expect to see the benefit of the
above in the current financial year,
albeit more so in the second half. As it
stands, despite a soft market impacting
Q1 than anticipated, the Group is
trading at an EBITDA positive level year
to date and is hopeful of delivering
an EBITDA profit for the first half. Cost
savings and the benefit from some new
initiatives will benefit H2 and beyond.
Whilst we necessarily remain cautious
short term as the UK market continues
to be challenging, we believe we are
well positioned to capture business
as demand levels and business
confidence hopefully return. Our wider
geographic footprint and investment in
strategic acquisitions should also serve
to de-risk the Group.
Mid-term we are optimistic that our
focus and investments will allow us to
drive growth of strategic business units
and therefore unlock long term value
for shareholders.
The strength of our balance sheet allows
us to continue to do what is best for the
business strategically and we continue
to review organic and non-organic
opportunities for growth which meet
our strict criteria and add value for
our shareholders. We remain primarily
interested in strategic acquisitions in
technical, higher margin distributors who
we can help scale and who re-enforce
our strategic focus areas.
Alexander Phillips
Chairman
20 November 2024
Chairman’s Statement continued
“Our continued focus
on sustainable and
healthy gross margin
business yielded a
record gross profit
percentage of 14.4%”
Northamber Report and Accounts 2024
Strategic Report
Governance Report
Financial Statements
5
Strategy and Performance
The Directors present their
strategic report on the
Group for the year ended
30 June 2024.
This report provides an overview of the
Group’s strategy, its business model
and a review of how the Group has
performed for the year. It also sets
out the principal risks involved in its
business and the financial position of
the Group at the year end. There are
also some comments and observations
on the future prospects for the Group.
1 The Group’s Strategy
As explained below in the notes
on the business model, the Group
is not directly involved with the
ultimate users of the products
it sells. It purchases goods from
manufacturers and sells these
products to resellers for sale to the
ultimate end user.
This being the case requires us
to develop strategies with both
suppliers and resellers to satisfy the
needs of those ultimate users of the
products.
Our strategy has always been
to assess the requirements of
the end users and then source
quality products and services from
manufacturers and make them
available to resellers at the best
prices in the most efficient time
frame. With an ever changing
product range it has also been part
of our strategy to support fresh new
products which will be attractive to
end users.
In addition to the supply of
hardware and software products
we also ensure that our customers
are provided with the technical
support either directly or through
the suppliers which they may
require to effectively use the high
tech products we sell, thus ensuring
quality of supply and satisfaction
to users.
“Northamber aims to
be the most proactive,
specialist AV & IT
distributor, delivering
exceptional service for
our partners.”
6
Northamber Report and Accounts 2024
Strategy and Performance continued
2 The Business Model
The Group has, since its inception,
been involved in the distribution
of electronics and computer
related products. Initially this was
predominantly printers but this
has been extended over the years
to include not only computers
themselves but also a wide range
of peripheral and ancillary related
products including audio visual.
The Group has a two pronged
approach in driving the business,
being both demand driven and
supply driven. The demand
drivers are the requirements of
our customers where we strive to
provide a wide range of products
and get them to the customer in
the quickest possible time and
at acceptable prices. The supply
drivers are the requirements of our
suppliers – the vendors. Vendors in
the main are one of two types, there
is the major brand type of supplier
who is looking for us to increase its
turnover, to physically get products
to the customer. The second type
of supplier differs only in that they
tend to be the smaller producers,
who often develop new or innovative
products and are looking for a
method of reaching an established
wide ranging customer base which
is beyond their own resources.
Our business model is to satisfy
all those wants by providing a
marketing and selling operation
to optimise the penetration of the
products to the customers and a
distribution facility which includes
warehousing and bulk breaking
using sophisticated systems and
procedures to achieve a first class
delivery service.
Audio Visual
Network
infrastructure
Peripherals
Cyber
security
Print &
Document
Management
Unified
communications
and collaboration
7
Strategic Report
Governance Report
Financial Statements
Northamber Report and Accounts 2024
The Group has an extensive
management reporting
system and uses a wide
variety of information in its
everyday management
of the business. This
information is tailored to
the various aspects of the
business with individual
managers being responsible
for variances in movements
within their particular
sphere of operations to the
executive management of
the company.
The principal KPIs which are used and
which have been reported elsewhere in
our Annual Report are the following:-
1
Working Capital Ratio is calculated by adding Inventory and Net Trade Receivables, divided by Trade Payables.
Strategy and Performance continued
3 Key Performance Indicators (KPI’s)
Revenue (£m)
2023/24
2022/23
£56.0m
£67.1m
Gross Profit Percentage Margin (%)
2023/24
2022/23
14.4%
13.3%
Net Assets per share (pence)
2023/24
2022/23
82.0p
87.7p
Working Capital Ratio1 (Times)
2023/24
2022/23
2.56x
2.20x
8
Northamber Report and Accounts 2024
5 Financial Review and Position
4 Performance Review
For some time the Group has been
following a strategy of change away
from the basic hardware type products
which are in the main physically larger
type products with relatively low margin
and subject to great price pressure,
towards more application intensive
type products where there is greater
scope for adding value and gaining
margin.
However such changes need very
careful planning and implementation to
minimise the inevitable consequences
which usually includes not only
significant costs upfront before the
benefits of the changes are manifest
but also some tail off of some parts of
the existing business.
There was a continuation of the move
towards consolidation in some parts
of the industry, particularly towards the
ultimate consumer end of the industry.
Revenue decreased 17% by £11.1 million
compared with last year with an
increase of 10% in gross margin
percentage.
Our cash balance at the end of
the financial year was £4.7 million
decreased from £5.5 million. £2.8 million
has been drawn down on the invoice
discounting facility at the balance
sheet date.
Some of the Net Assets comprise the
carrying value of freehold properties,
cash and the balance working capital.
The Net Assets were which represented
more than the average share price in
the year.
Strategy and Performance continued
9
Strategic Report
Governance Report
Financial Statements
Northamber Report and Accounts 2024
Strategy and Performance continued
Financial Risks
The Group uses various financial
instruments, including cash, equity,
trade receivables and trade payables
in the course of its operations. During
the year the Group opened an invoice
discounting facility to assist with
working capital requirements and
strategic acquisition opportunities.
The use of these instruments gives rise
to risks associated with exchange rate
risk, liquidity risk, interest rate risk, credit
risk, inventory risk and reputational risk.
The Directors review and agree policies
to deal with each of these risks as
summarised below.
Exchange Rate Risk
The Group purchases some of its
products in foreign currency. Foreign
currency purchases are subject to
close management supervision. The
Directors are informed regularly of
the potential impact of exchange
rate movements on the business and
purchases are scheduled to mitigate
any adverse movement wherever
possible. It is the Group’s policy not
to speculate in derivative financial
instruments in either sterling or foreign
currencies, nor to hedge translation or
currency exposures.
Liquidity Risk
The Group seeks to manage financial
risk of liquidity by ensuring it has
sufficient cash resources available to
meet foreseeable needs at all times
through regular cash flow forecasting.
Interest Rate Risk
The Group’s exposure to interest
rate risk is principally with its new
invoice discounting facility which was
approved by the Board during the
financial year.
Credit Risk
Credit risk is deemed a risk due to
default in payment. The Group’s
principal financial assets are cash
and trade receivables. The credit
risk associated with cash is reduced
through ensuring the funds are
held with major financial institutions
and where possible deposits being
split across a number of banks. The
credit risk arising from the Group
and company’s trade receivables is
reduced through prescribing credit
limits for customers based on a
combination of payment history,
third party credit references and
credit insurance levels. Credit limits
are reviewed on a regular basis in
conjunction with debt ageing, collection
history and credit insurance levels.
Given the current economic climate the
Group feel it prudent to maintain Credit
Insurance.
Inventory Risk
The Group operates in the technology
industry and has an inventory risk in
that older inventory can decrease in
value. The Group mitigates this risk by
seeking to have strong contracts with
suppliers which allow the return and
rotation of stock where possible, and
by internal control procedures where
the ageing of inventory is regularly
reviewed and remedial plans are
actioned.
Reputational Risk
The Group’s reputation is reliant on
timely delivery of goods and services
according to customer requirements
and associated goodwill generated
with customers. The principal risk
involved is that the warehouse could
be destroyed or made inoperable
although the cost of such eventuality
is of course covered by insurance,
including loss of profits cover, but
the operation is such that alternative
accommodation could quickly be
brought into action, or alternatively
a warehousing function could be
subcontracted at very short notice.
Although such an event would have
costs attached and would cause some
disruption in the business, it would be
far from catastrophic.
The existence of the Group’s facilities
such as the warehouse, the sales staff,
the control systems and not least the
financial soundness of the company
means that we can offer a distribution
facility which is quick and efficient,
an attraction to both vendors and
customers.
Market Risk
The Group is subject to both general
market conditions and particularly
to those affecting its own particular
industry. The Group is a distributor
of other businesses’ products and is
therefore dependent on the suppliers
of such products to continue to
provide products which are required
by the customers of the company,
at prices which are acceptable to
those customers. This is managed
within the Group by being alert to all
the movements in the market place
relating to both products and suppliers
and to negotiating with existing and
prospective suppliers for the supply
of goods on the best possible terms
to enable the company to trade
effectively.
Where products are bought in foreign
currency, the Group manages the
risk inherent in such currencies by
continuously updating its rates of
conversion in calculating its costs
to ensure prices remain competitive
and in order to minimise the currency
conversion risk.
6 Principal Risks and Uncertainties
10
Northamber Report and Accounts 2024
Strategy and Performance continued
The Group recognises the importance
of providing additional services to
its customers in relation to next day
deliveries, credit limits, handling queries
efficiently and maintaining a strong
relationship with the customer and in
this way aims to resist the competitive
pressures in the sector.
Other Principal Risks and
Uncertainties
Other than the risks stated above, in the
opinion of the Directors, the principal
operating risks are as stated in the
section on Internal Control on page 23.
The risks and uncertainties associated
with the business model are set out
below.
The model depends in part on working
closely with the brand names in the
industry as it is often the products
from these vendors which form the
core of the business, and in part on
the development of new vendors
particularly for the innovative products
which are integral to the IT industry. Co-
operation with vendors is therefore key
and this risk of attrition is addressed by
a combination of mutual co-operation
with vendors on the range of products
being offered, the pricing of those
products and the marketing of those
products. The company’s continual
search for new and improved products,
particularly in peripherals, from new
vendors also improves the range of
products we can offer and thereby
attract more customers to ourselves
which enhances our attraction to the
vendors and reduces the risk of loss of
vendors.
All systems within the Group, including
the control systems, are backed up
securely on a regular basis, thus limiting
the risk of data loss to a short period.
The financial soundness of the Group
is a matter which is constantly in the
minds of the senior staff and Directors
of the Group. Systems are in place to
ensure that any deviation from the
norm is immediately brought to the
attention of staff and Directors. These
systems have a proven history as
shown in the strength of the Statement
of Financial Position. The Group has
sufficient working capital to enable it to
meet its requirements.
Inflationary Risk
In line with most businesses, the
Group has experienced rising supply
prices over the past 2 years due to the
increases in energy prices and also
market uncertainty due to interest rate
rises and supply chain issues. Whilst the
Group has passed on price rises where
possible, this has caused uncertainty in
demand. The Group believes that there
is likely to be a continuing slowdown in
demand for some of its products but
believes that with its diverse range it
can mitigate some of these demand
decreases.
6 Principal Risks and Uncertainties continued
7 Future Prospects
The Board’s long term approach
to investment decisions is well
documented and often referenced
in these statements. This approach
was continued in the last year as
we invested significantly in our new
focus categories to help drive the
business forward. This coupled with
other investments in new vendors,
customer acquisition and our
renewed strategy leave us excited
about the revenue and margin
opportunities for the coming year.
We see significant potential in
both our existing vendors and
categories and the new categories
we are developing and exploring.
We will continue our customer-
centric focus and ensuring
that our offering and service
levels allow our customers to
profitably grow their business and
consequently grow ours.
8 Events after the
reporting period
The Company acquired 100% of
the share capital of Renaissance
Contingency Services Limited on 1
July 2024. The total consideration
for the Acquisition is up to €0.9
million in cash with €0.6m paid
on completion and Performance
based contingent consideration of
up to a maximum of €0.3 million
based on the EBITDA for three
financial periods ending 30 June
2025, 2026 and 2027. If it becomes
due, the Contingent Consideration
will be paid in three instalments
with the final payment due to be
made following completion of
the audit of the enlarged group’s
accounts for the financial year
ended 30 June 2027.
Northamber Report and Accounts 2024
11
Strategic Report
Governance Report
Financial Statements
The following disclosure forms the Directors’ statement required under section 414CZA of the Companies Act 2006 on how the
Directors have had regard to the matters set out in section 172 (1) (a) to (f) in performing their duties. The Board recognises
that engagement with its stakeholders is fundamental to the long-term success of the company and considers the views and
interests of all key stakeholders in its decision making.
People
As reported on page 4 our people are key stakeholders in the business as the recruitment, training
and retention of experienced staff is key to the high quality service delivery to our customers.
Employee engagement and interaction is encouraged through a variety of means including:
• Group wide town quarterly hall calls and half yearly Group kick off meetings
• team meetings; and
• staff one-to-one meetings throughout the year.
Following the periods of lockdown and subsequent home working in previous financial years,
the Group has adopted a hybrid working approach during the year for office based employees
with employees required to attend the office on Tuesdays, Wednesdays, Thursdays and Fridays
and working from home on Mondays. We also have a number of remote workers. We believe this
flexible approach maximises efficiency and allows us to attract the talent required regardless
of location. We ensure that our employees have appropriate equipment to enable them to
operate efficiently when working from home and that they have the collaboration tools to enable
continued communication and interaction across the business and between colleagues.
We invest in the development of future talent within the Group providing financial support for
employees who are undertaking professional training to gain the qualifications required to
progress with their careers. In addition we strongly support training and accreditation schemes
from our suppliers to further the professional development of our employees.
Shareholders
The chairman and company secretary have primary responsibility for investor relations (IR).
The company makes announcements using the regulatory news service (RNS) throughout the
financial year so that all investors are aware of current developments and financial performance
of the Group.
The annual general meeting of the company, which is generally attended by all Directors,
provides an opportunity for all shareholders to ask questions and to meet the Directors. The Board
is always open to meet separately with shareholders on request.
Customers
Our customers are key stakeholders as their retention and acquisition are fundamental to the
ongoing success of our business.
The Group has a diverse customer base across all our sectors servicing clients of all sizes. Our
customer facing teams are in continuous contact with their base and have responsibility for both
understanding their expectations and managing the delivery of our products and solutions.
Strategy and Performance continued
Section 172 statement
12
Northamber Report and Accounts 2024
Suppliers
Our suppliers are key stakeholders to the business as the Group is reliant on the constant flow of
quality products and solutions to service our customer base and maintain and gain market share.
The Group has periodic reviews with all existing suppliers to ensure that business objectives are
met and to ensure that quality of products and services is maintained at all times.
The Group employs product specialists who constantly review the market for new suppliers
who can maintain the high quality of products and services offered by the Group and can
complement existing products and services offered.
The impact of
the company’s
operations on the
community and
the environment
The Company is committed to ensuring that it is an asset to the local community and seeks to
ensure that it meets the highest level of health and safety standards, and minimises its impact
on the environment. The Company seeks to engage with the community, where appropriate, to
achieve this.
Our goal in terms of climate change is to do all we reasonably can to reduce the impact of our
activities on the climate. This involves constantly working with our suppliers to meet the growing
demand for more sustainable, greener products.
We are investing in electric car schemes and have installed solar panels to power our warehouse
and are looking at solar power options for our other buildings.
Acquisitions
During the reporting period the Company acquired 100% of the share capital of Tempura
Communications Ltd (Group).The total consideration for the Acquisition is up to £6.02 million in
cash and the issue and allotment to the Seller of 181,818 ordinary shares of 1 pence each in the
capital of the Company.
Governance
The Board believes that it is has the right mix of skills and experience in order to deliver its strategy
for the benefit of all stakeholders.
On behalf of the Board
P. Dosanjh
Director
20 November 2024
Strategy and Performance continued
Northamber Report and Accounts 2024
13
Strategic Report
Governance Report
Financial Statements
Governance
Report
In this section
Report of the Directors
15
Report to Shareholders by the
Board on Directors Remuneration
17
Corporate Governance
19
Statement of Directors’ Responsibilities 25
Directors and Advisers
26
Report of the Independent Auditor
28
Northamber Report and Accounts 2024
14
The Directors have pleasure in presenting
their report and the accounts for the year
ended 30 June 2024.
The financial statements include the individual entity
Northamber plc and its wholly owned subsidiaries
Anitass Limited, Audio Visual Material Limited, Tempura
Communications Ltd and Tempura Technology Limited. Anitass
Limited owns the freehold of the premises at Swindon which is
the Group’s distribution centre which were purchased during
the year to 30 June 2020. Audio Visual Material Limited trades
as a distributor and was acquired by Northamber plc on 31
January 2020. Tempura group trades as a distributor and
was acquired by Northamber plc on 29 April 2024. The other
subsidiaries of Northamber plc are dormant and not material
to the financial statements for the year to 30 June 2024.
Principal Activities
The Group’s and company’s principal activities are those of
specialist supply of computer hardware, computer printers
and peripheral products, computer telephony products and
other electronic transmission equipment.
Financial Risks
The Group uses various financial instruments including cash,
equity and various items such as trade receivables and
trade payables that arise directly from its operations. The
existence of these instruments expose the Group to a number
of financial risks, the main ones being exchange rate risk,
liquidity risk, interest rate risk and credit risk. The Directors
review and agree policies for managing each of these risks
and these are summarised in the Strategic Report.
Corporate Governance
The Corporate Governance Report on pages 19 to 24 forms
part of the Directors’ Report and is incorporated into this
report by reference.
Dividends
The following dividends were paid in the year ended 30 June 2024
2024
£’000
2023
£’000
Ordinary dividends
Previous year’s final dividend paid
82
82
Interim paid
81
81
163
163
The final proposed dividend of 0.3p (2023: 0.3p) will be paid on
17 January 2025 to all members on the register at the close of
business on 13 December 2024.
Directors
Directors of the company who have served at any time during
the year are listed on page 26.
Directors’ indemnity provision
Qualifying third-party indemnity provision was in place for
all Directors throughout the financial year and at the date of
approval of this report.
Share Capital
At 30 June 2024, the company had 27,413,404 (2023: 27,231,586)
Ordinary shares of 1p each issued. The shares have no special
rights and there is no restriction on their voting rights.
Substantial Shareholdings
The company has been notified that the following
shareholders held beneficial interest of 3 per cent or more of
the company’s issued share capital at 15 November 2024.
Ordinary
Shares of 1p
each
Mr A.M. Phillips
62.58%
Herald Investment Management Limited
6.41%
Worsley Investors Limited
6.08%
Mr & Mrs J. Rockliff
3.66%
Mrs F. Phillips
3.83%
Purchase of Own Shares
At the end of the year, the Directors had authority, under
the shareholders’ resolutions of 20 December 2023 to
purchase through the market 2,723,158 (2023: 2,723,158) of
the company’s ordinary shares at prices ranging between 1p
and 105% (202:3 1p and 105%) of the average middle market
quotations for those shares as derived from the London Stock
Exchange on the ten dealing days immediately preceding the
day on which the shares are contracted to be purchased. This
authority expires on 19 December 2024, the date of the next
Annual General Meeting.
Auditors
The auditors, Dains Audit Limited, have expressed their
willingness to continue in office and a resolution to reappoint
Dains Audit Limited will be proposed at the forthcoming Annual
General Meeting.
Report of the Directors
Northamber Report and Accounts 2024
15
Strategic Report
Governance Report
Financial Statements
Report of the Directors continued
Employee Engagement
Every effort is made to keep staff as fully informed as
possible about the operations and progress of the company.
This is achieved through regular communication from the
Operations Director to all staff and from the CEO to the
Operational Management team meetings.
The Group encourages its staff to pursue career development
and to that end has made available resources for training
courses including video and computer training aids.
Applications received from disabled persons are given
full and equal consideration but are small in number.
The company fulfils its obligations towards employees who
are disabled or who become so whilst in the employment of
the company.
Energy and carbon reporting
Under the Streamlined Energy and Carbon Reporting Regime,
the Company is required to report its energy consumption
and greenhouse gas emissions arising in the UK.
Our disclosures are set out below and include energy and
emissions from the entire Group, regardless of whether
individual companies would be required to report.
UK Energy Use
Electricity
Gas
TOTAL
To 30 June 2024
Consumption
218.8, MWH
0, MWH
Greenhouse Gas (GHG)
Emissions (tCO2e)
45
0
45
To 30 June 2023
Consumption
194.0, MWH
79.7, MWH
Greenhouse Gas (GHG)
Emissions (tCO2e)
40
15
55
Notes
Electricity
consumed
relates to routine
office and
warehouse power
requirements
Gas used to
fuel heating
and hot water
boilers in office
and warehouse
locations
Methodology
• Electricity – The electricity consumed by the Group
relates to the routine power requirements of its offices
and warehousing – lighting, heating, IT, air conditioning
etc. To calculate the tCO2e figure we have taken our
overall electricity usage for the year to which a kgCo2e
factor of 0.207075 was applied, being the UK Government’s
Conversion Factor 2024 for this type of electricity use.
• Gas – During the year the Group ceased using gas in its
warehouse having installed solar panels in its warehouse.
Gas used in the Group’s head office is minimal and not
considered material.
• Motor Vehicles – The company owned one petrol van
and one electric car for the entire year and two electric
company cars for part of the year so emissions are not
included above as not considered material.
Intensity Ratio
Tonnes of CO2e per total £56 sales revenue during the year to
30 June 2024: 1.2 (2023: 1.1).
Energy Efficiency Activity
The Group continues to invest in a scheme to provide
electric cars as a salary sacrifice arrangement. The Group
is mindful of its environmental obligations and will examine
opportunities to further cut its carbon emissions.
Customers and Suppliers
The Directors foster and maintain strong relationships with
customers and suppliers as set out in the s172 Report on
pages 12 to 13.
Events after the reporting period
Details of important events occurring after the end of the
reporting period and future developments are described in
the Strategic Report, and the details are incorporated into this
Directors’ report by cross-reference.
Statement of disclosure to auditor
The Directors confirm that:
• in so far as each director is aware there is no relevant audit
information of which the company’s auditors are unaware;
and
• the Directors have taken all steps that they ought to
have taken as Directors to make themselves aware of
any relevant audit information and to establish that the
auditors are aware of that information.
By order of the Board
S. Yoganathan ACMA
Company Secretary
20 November 2024
16
Northamber Report and Accounts 2024
The Group voluntarily provides the following
Directors’ Remuneration Report
Remuneration Committee
The Remuneration Committee comprised the Non-Executive
Directors Mr C.M. Thompson, and Mr R. Reggio. This committee
meets at least once a year and decides the remuneration
policy that applies to executive Directors.
In setting the policy it considers a number of factors including:
(a)
the basic salaries and benefits available to executive
Directors of comparable companies;
(b)
the need to attract and retain Directors of an
appropriate calibre and experience; and
(c)
the need to ensure executive Directors’ commitment
to the continued success of the company by means of
incentive schemes.
The Group’s remuneration policy for executive Directors is to:
(a)
have regard to the Directors’ experience and the
nature and complexity of their work in order to
pay a competitive salary that attracts and retains
management of the highest quality;
(b)
link individual remuneration packages to the company’s
performance through target-related bonuses which are
not considered to be excessive in terms of salary;
(c)
provide employment-related benefits including the
provision of a company car, life assurance, insurance
relating to the Directors’ duties and medical insurance.
The final determination of an individual director’s
remuneration is taken by the Board as a whole but with no
director participating in the discussions, nor voting on, his own
remuneration package.
The Non-Executive Directors each receive a fee for
their services which is agreed by the Board following
recommendation by the chairman. The Non-Executive
Directors do not receive any pension or other benefits from
the company, nor do they participate in any of the bonus or
incentive schemes.
When reviewing or amending remuneration arrangements
the committee considers any impact on the cost to the
company, employee behaviour, stakeholders (including
shareholders, governance bodies and employees) best
practice, corporate governance and market competitiveness.
Salaries and Benefits
The remuneration packages for executive Directors are
benchmarked to ensure comparability with companies
of a similar size and complexity. The bonuses have regard
to personal performance measured against pre-stated
objectives and profitability of the company.
Share Options
There are share option schemes in force in the Group or
company in the year ended 30 June 2024.
Contracts of Service
The five executive Directors, Mr A.M. Phillips, Mr J.P. Henry,
Mr A.R. Lee, Mr J. Keefe and Mr P. Dosanjh, have service
contracts. All five contracts are one year rolling contracts
and contain no specific provisions in relation to any
termination payments over and above the notice periods as
stated below.
Notice
period
Mr A.M. Phillips
six months
Mr J.Keefe
six months
Mr J.P. Henry
six months
Mr A.R. Lee
six months
Mr P. Dosanjh
six months
Mr J Keefe resigned from the Board on 30 September 2024.
The Non-Executive Directors do not have service contracts
with the company. The terms of their appointment are
reviewed by the Board every two years.
Directors’ Detailed Emoluments
Details of Directors’ emoluments are as follows:
During the year pension contributions were made by the
company on behalf of 3 Executive Directors under money
purchase schemes. The aggregate amounts paid are shown
in the table below.
Report to Shareholders by the Board
on Directors’ Remuneration
Northamber Report and Accounts 2024
17
Strategic Report
Governance Report
Financial Statements
Directors’ Interests
Salaries and Fees
Benefits
Pension
Total
2024
£’000
2023
£’000
2024
£’000
2023
£’000
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Executive
Mr P. Dosanjh
111
114
1
-
1
1
113
115
Mr J.P. Henry
100
100
13
13
10
10
123
123
Mr A.M. Phillips
33
33
4
7
10
10
47
50
Mr Jeremy Keefe
95
-
3
-
2
-
100
-
Mr A.R. Lee
110
100
8
11
10
10
128
121
Non-Executive
Mr G.P. Walters
-
10
-
-
-
-
-
10
Mr C.M. Thompson
59
61
-
-
-
-
59
61
Mr R. G. Reggio
20
20
-
-
-
-
20
20
528
438
29
31
33
31
590
500
The amounts above include £39,000 for IT consultancy fees paid to C Thompson (2023: £41,000).
For the year ended 30 June 2024 Mr A.M. Phillips has waived £67,000 of his salary (2023: £67,000).
Directors in office at 30 June 2024 had the following beneficial interests in the shares of the company:
Ordinary Shares of 1p each
Mr A.M. Phillips
17,154,874
17,154,874
Mr J. Keefe
1,000
-
Mr J.P. Henry
-
-
Mr A.R. Lee
-
-
Mr P. Dosanjh
1,000
1,000
Mr R. Reggio
-
-
Mr C.M. Thompson
14,500
14,500
Between 30 June 2024 and 15 November 2024 there have been no changes in the interests of the above named Directors in the
shares of the company.
The market price of the company’s shares at 15 November 2024 was 29p. The range of market prices during the year was
35p to 50.5p.
By order of the Board
S. Yoganathan ACMA.
20 November 2024
Report to Shareholders by the Board on
Directors’ Remuneration continued
18
Northamber Report and Accounts 2024
Corporate Governance
The Corporate Governance Report forms
part of the Directors’ Report included on
pages 15 to 16.
Northamber plc (“the Company”) is an AIM quoted Company
and is committed to high ethical values and professionalism
in all its activities. As an essential part of this commitment,
the Directors acknowledge the importance of high standards
of Corporate Governance and, given the Group’s size and
the constitution of the Board, have decided to apply the
principles set out in the Corporate Governance Code for small
and mid-sized companies published by the QCA in April 2018
(‘‘QCA Code’’). The Board is accountable to the Company’s
shareholders for good Governance.
Corporate Governance Policy
The Group’s policy on Corporate Governance is published on
the Group’s website which is www.northamber.com.
The Company’s objective is in alignment with the purpose
of the QCA Code in that it is to deliver growth in long-term
shareholder value and to deliver benefits to other
stakeholders, accompanied by good communication to
promote confidence and trust.
Set out below are the principles of the QCA Code and the
Company’s approach to compliance with the QCA Code,
in support of its medium to long term success. In some
areas, further development is required internally to more
fully comply with the QCA Code and as these take place the
website will be updated.
Strategy for long term shareholder growth
The Group’s strategy is set out in full on page 6. Whilst
the basic strategy remains the same, changes to its
implementation from time to time to meet changing
circumstances are determined by the Board as necessary.
The management team, reporting to the Board, is responsible
for implementing the strategy and managing the business at
an operational level.
Meeting shareholders’ needs and expectations
As set out on page 15 under Substantial Shareholdings, 83.26%
of the shares are held by five parties, of which Alexander
Philips holds 62.58%, leaving only 16.42% in other shareholders’
hands. The Chairman is in contact with shareholders from
time to time and via the Company’s brokers issues the
Half-Yearly Statements and other statutory information.
In addition, the holding of an Annual General Meeting at
a convenient time and place enables contact between
shareholders and Directors. Notice of the Annual General
Meeting is circulated to all shareholders at least 21 days prior
to the meeting. Directors attend the AGM and will be available
to answer shareholders’ questions.
Shareholders may, at any time, communicate with the
Company either via the Company Secretary or through the
Company’s brokers.
The Company intends to announce the detailed results of
Shareholder voting at the AGM to the market, including any
actions to be taken as a result of resolutions for which votes
against have been received from at least 20 per cent of
independent shareholders.
Consider wider stakeholder and social
responsibilities
The Company has a policy of being socially responsible and
has established Social and Community Policy to be followed
by the Company in respect of Social, Community and
Environmental matters. The Board also recognises the need
to maintain effective working relationships across a range
of stakeholder groups, including shareholders, employees,
partners and suppliers.
The Company’s operations and working methodologies take
account of the need to balance the needs of all of these
stakeholder groups while maintaining focus on the Board’s
primary responsibility to promote the success of Northamber
for the benefit of its members as a whole.
Effective Risk Management
The Board is responsible for the systems of risk management
and internal control and for reviewing their effectiveness.
The internal controls are designed to manage rather than
eliminate risk and provide reasonable but not absolute
assurance against material misstatement or loss. The
Company’s detailed approach to the management of risk is
set out in the section on Principal Risks and Uncertainties on
pages 10 to 11. There is a risk assessment carried out by the
Board at regular intervals.
The Board maintains full control and direction over
appropriate strategic, financial, organisational and
compliance issues and has put in place an organisational
structure with formally defined lines of responsibilities and
delegation of authority. There are established procedures
for planning, capital expenditure, information and reporting
systems and for monitoring the company’s business and
its performance. The Board has delegated to executive
management the implementation of the systems of internal
control within an established framework that applies within
the Company.
Northamber Report and Accounts 2024
19
Strategic Report
Governance Report
Financial Statements
Effective, well-functioning Board, with up to date
skills and experience
The Board normally comprises 4 executive and 2 independent
Non-Executive Directors.
The biographies of the Directors are set out on pages 26 to 27.
Similarly, the method of establishing the effectiveness and
appropriateness of the Board is set out on page 23. This
process includes the assessment of the range of skills and an
evaluation of the effectiveness of each Director.
All Directors have access to the advice and services of
the Company Secretary and the Board has established a
procedure whereby any Director may seek independent
professional advice in the furtherance of his duties
at the Company’s expense. All Directors are able to
allocate sufficient time to the company to discharge their
responsibilities.
As required by the Company’s articles of association, in every
year at least one-third of the Directors offer themselves for
re-election at the Annual General Meeting.
The Board is responsible to the shareholders for the proper
management of Northamber and meets at least four times
a year to set the overall direction and strategy, to review
operational and financial performance and to advise
on management appointments. All key operational and
investment decisions are subject to Board approval. The
Board also regularly discusses matters informally through
the year. Any Board member may request the Company
Secretary to report on any specific matter and prepare
information for discussion at the Board meetings.
In addition to the Main Board there is an Audit Committee and
Remuneration Committee, in each case chaired by a Non-
Executive Director. Further details regarding the responsibilities
of these committees can be found on pages 17 & 22.
In view of the size of the Company and its share and Board
structure it has determined that the appointment of a
Nominations Committee is not warranted.
Below the Main Board there is an Operations Committee
comprising the executive Directors and senior management
of the Company.
The Director’s attendance at Board meetings is shown on
page 22.
The role of the Board is to ensure that the Company is
managed to optimise the benefits to its stakeholders
including shareholders, staff, customers, suppliers and the
community at large. To achieve this objective the Board
reserves to itself certain matters such as the formulation of
strategy, the assessment of risk, and the setting of internal
control systems. Certain areas of responsibility of the Board
are dealt with by committees of the Board such as the audit
committee and the remuneration committee reporting back
to the Main Board.
The implementation of the decisions of the Main Board
is delegated to the senior management of the company
through the Operations Committee chaired by the Managing
Director.
Evaluate Board performance
During the year, the Board reviewed each aspect of its role
to ensure that it was fulfilling its role effectively and that
each Director was individually making a full and effective
contribution to the process. This was carried out by the
Chairman reviewing the individual and collective contribution
of the Board members against objectives.
The result of that review was that, having reviewed each
Director’s contribution and the requirements of the Company
as a whole, each Director was effective and that the
composition of the Board was appropriate and more than
adequate for the time being.
The Chairman, in conjunction with the executive team,
ensures that the Directors’ knowledge is kept up to date on
key issues and developments pertaining to financial and
governance matters, its operational environment and to the
Directors’ responsibilities as members of the Board. During
the course of the year, Directors received updates from
the Company Secretary and various external advisers on a
number of corporate governance matters.
Corporate Culture and Ethical Structures
The corporate culture and ethics is based on honesty and
integrity in all matters and relating to all parties. There are
policies in place within the working practices within the
Company to ensure compliance with the high standards
set. Whistle blowing provisions are also in place to deal with
any infringements of the policies. The policies are regularly
reviewed, updated and communicated to all staff.
The Company has adopted a share dealing code for the
Directors and certain employees, which is appropriate for
a company whose shares are admitted to trading on AIM
(including relating to the restrictions on dealings during close
periods in accordance with UK MAR and with Rule 21 of the
AIM Rules for Companies). The Company takes all reasonable
steps to ensure compliance with the share dealing code by
the Directors and any relevant employees.
Corporate Governance continued
20
Northamber Report and Accounts 2024
Corporate Governance continued
Governance Structures and Processes
The Corporate Governance structure and processes are set
out on pages 17 to 23.
The Board is led by the Executive chairman and is responsible
for the overall direction and strategy of the Company.
The Non-Executive Directors are responsible for bringing
independent and objective judgment to Board decisions,
bringing a range of views and experience from different fields.
As part of their role, the Non-Executive Directors constructively
challenge and develop proposals on strategy.
The Company Secretary is responsible for ensuring that Board
procedures are followed and applicable rules and regulations
are complied with.
The Board has established an Audit Committee and a
Remuneration Committee, each with formally delegated
duties and responsibilities.
The Audit Committee, which meets at least twice a year, is
responsible for keeping under review the scope and results of
the audit, its cost effectiveness and the independence of the
auditor.
The Remuneration Committee, which meets at least once
a year, is responsible for considering the remuneration
packages for executive Directors and making
recommendations as appropriate.
The Directors’ Remuneration Report is set out on page 17.
Detailed processes and procedures are in place and
available to all employees on a dedicated in house system to
ensure that all operations, actions and decisions made by the
employees are fully compliant and avoid undue risk.
The internal procedures are reviewed and updated regularly
to maintain the highest level of standards.
Communication
The Board places a high priority on regular communications
with its various stakeholder groups and aims to ensure that
all communications concerning Northamber’s activities
are clear, fair and accurate. In addition to the statutory
published information, the Company regularly updates
its website for the benefit of shareholders, customers and
suppliers. Communications with employees are maintained
both by personal interaction with the Directors and
senior management on a daily basis and through formal
procedures. Communications with professional advisers
ensure that the Company maintains and complies with up
to date regulations regarding both internal and external
communications.
The results of voting on all resolutions in future general
meetings will be posted to the website, including any actions
to be taken as a result of resolutions for which votes against
have been received from at least 20 per cent of independent
shareholders.
Directors
Board of Directors
The Group is led and controlled through the Board of Directors,
which during the year comprised four executive and two Non-
Executive Directors. Biographical details of each director in
office during the year appear on pages 26 to 27.
All Directors have access to the advice and services of
the company secretary and the Board has established a
procedure whereby any director may seek independent
professional advice in the furtherance of his duties at the
company’s expense. All Directors are able to allocate sufficient
time to the company to discharge their responsibilities.
As required by the company’s articles of association, one third
of the Directors offer themselves for re-election every year.
Non-Executive Directors
The Board considers that the Non-Executive Directors were
independent throughout the year. The Non-Executive Directors
actively contribute to the functioning of the Board and bring a
range of views and experience from different fields.
As part of their role, the Non-Executive Directors
constructively challenge and develop proposals on strategy.
The Non-Executive Directors scrutinise the performance of
management in meeting agreed goals and objectives and
monitor the reporting of performance. They satisfy themselves
on the integrity of financial information and that financial
controls and systems of risk management are robust and
defensible. They determine appropriate levels of remuneration
of executive Directors and have a prime role in appointing
and, where necessary, removing executive Directors, and in
succession planning.
The senior independent Non-Executive director, as included
in the biographical details on page 26, is available to
shareholders if they have concerns which contact through
the normal channels of chairman or other executive
Directors have failed to resolve or for which such contact is
inappropriate.
Northamber Report and Accounts 2024
21
Strategic Report
Governance Report
Financial Statements
Directors’ Attendance
The following table shows the attendance of Directors at the
Board meetings held in the last year.
Number of Board Meetings
Entitled to
Attend
Attended
Mr Alexander Michael Phillips
6
6
Mr John Phelim Henry
6
4
Mr Antony Richard Lee
6
6
Mr Colin Mark Thompson
6
6
Mr Peter Dosanjh
6
6
Mr Riccardo Reggio
6
6
Mr Jeremy Keefe
4
4
Audit Committee
The Audit Committee, currently chaired by Mr Riccardo
Reggio, comprised the two Non-Executive Directors, all of
whom are considered by the Board to be independent and
to have sufficient recent and relevant financial experience to
discharge the committee’s duties.
The Board considers that the members of the audit
committee have the required understanding of:-
• the principles of, content of and developments in financial
reporting, including the applicable accounting standards
and statements of recommended practice;
• key aspects of the company’s operations, including
corporate policies, financing and systems of internal
control;
• matters that could influence or distort the presentation of
accounts and key information;
• the role of external auditors.
The primary function of the audit committee is to enable
the Board to monitor the integrity of the company’s financial
reports and manage the Board’s relationship with the
external auditors. Its other functions include the review and
monitoring of:-
• the financial reporting process
• the annual audit
• the effectiveness of the company’s internal controls and
risk management
• the independence of the external auditors.
The audit committee reports to the Board its findings
identifying any matters which it considers requires that action
or improvement is required and makes recommendations on
the steps to be taken.
The committee’s terms of reference include all relevant
matters required by the Disclosure and Transparency Rules
and the relevant code provisions. The terms of reference of
the audit committee have been reviewed and are available
on request by writing to the company secretary at the
registered address and on the Company’s website.
Overview of the Actions Taken by the Audit
Committee to Discharge its Duties
During the year the audit committee:-
• reviewed the June 2023 annual report and financial
statements and the December 2023 half yearly financial
report. As part of the review the committee received a
report from the external auditors on their audit of the
annual report and financial statements
• reviewed the effectiveness of the company’s internal
controls
• reviewed and agreed the scope of the audit work to be
undertaken by the external auditors
• agreed the fees to be paid to the external auditors for their
audit of the 2023 report and financial statements
• reviewed the whistle blowing procedures in place to
enable staff to raise concerns in confidence about possible
wrongdoing
• considered the requirement for an internal audit function
in the company and decided to recommend to the Board
that such a function was not necessary at this stage
• recommended that the Board re-appoint the external
auditors Dains Audit Limited
External Audit
The engagement and independence of external auditors
is considered annually by the Audit Committee before it
recommends its selection to the Board.
The fees paid to the Auditors in the year are disclosed in
Note 4 to the Group financial statements.
Dains Audit Limited also follows its own ethical guidelines and
continually reviews its audit team to ensure its independence
is not compromised.
Corporate Governance continued
22
Northamber Report and Accounts 2024
Operations Committee
The Operations Committee comprises the executive Directors
and certain senior business managers. It meets weekly, and
deals with the operational matters of the company other than
those dealt with by the Remuneration and Audit Committees
or by the full Board.
Board Effectiveness
The role of the Board is to ensure that the company is
managed to optimise the benefits to its stakeholders
including shareholders, staff, customers, suppliers and the
community at large. To achieve this objective the Board
reserves to itself certain matters such as the formulation of
strategy, the assessment of risk, and the setting of internal
control systems. Certain areas of responsibility of the Board
are dealt with by committees of the Board such as the audit
committee and the remuneration committee reporting back
to the main Board. The implementation of the decisions of the
main Board is delegated to the senior management of the
company through the Operations Committee chaired by the
operations director.
During the year the Board reviewed each aspect of its role
to ensure that it was fulfilling its role effectively and that
each director was individually making a full and effective
contribution to the process. This was carried out by the
chairman reviewing the individual and collective contribution
of the Board members against objectives and by the audit
committee reviewing the performance of the chairman.
The result of that review was that, having reviewed each
director’s contribution and the requirements of the company
as a whole, each director was effective and that the
composition of the Board was appropriate and more than
adequate for the time being.
Going Concern Basis
The Group’s activities together with the factors likely to affect its
future development, performance and position are set out in
the Strategic Report and the Directors’ Report on pages 6 to 16.
The financial position of the Group, its cash flow and its liquidity
position are described in the Chairman’s Statement on pages 3
to 5. In addition, the Strategic Report also includes the Group’s
objectives, policies and processes for managing its capital;
its financial risk management objectives; and its exposure to
credit risk and liquidity risk.
The Group has considerable financial resources and established
market profile and relationships with a number of suppliers
and customers. As a consequence, the Directors believe that
the company is well placed to manage its business risks
appropriately despite the current economic outlook.
In carrying out their duties in respect of going concern, the
Directors in November 2024 completed a review of the Group’s
financial forecasts for a period exceeding 12 months from the
date of approving these financial statements to determine the
potential impact on the Group of reasonably possible downside
scenarios, including a review of the current market and relevant
downsides due to inflationary and cost of living pressures
together with the global economy. The Board are confident that
with the strong balance sheet and cash position all working
capital requirements will be met. There have been no significant
changes in levels of trading since the year end date.
After making enquiries, the Directors have formed a judgement,
at the time of approving the financial statements, that there
is a reasonable expectation that the company has adequate
resources to continue in operational existence for the foreseeable
future. For this reason the Directors continue to adopt the going
concern basis in preparing the financial statements.
Relations with Shareholders
The Directors are available to meet with the Group’s
institutional shareholders throughout the year on request.
Notice of the Annual General Meeting (AGM) is circulated to all
shareholders at least 21 days prior to the meeting. Directors attend
the AGM and will be available to answer shareholders’ questions.
Accountability and Audit
Financial Reporting
The Board believes that its Annual Reports and financial
statements represent a balanced and understandable
assessment of the company’s position and prospects whilst
also complying with the legal and regulatory requirements for
financial reporting relevant to the company.
Internal Control
The Board of Directors has overall responsibility for the
Group’s systems of internal control and for monitoring their
effectiveness.
The Board maintains full control and direction over
appropriate strategic, financial, organisational and
compliance issues and has put in place an organisational
structure with formally defined lines of responsibilities and
delegation of authority. There are established procedures
for planning, capital expenditure, information and reporting
systems and for monitoring the company’s business and
its performance. The Board has delegated to executive
management the implementation of the systems of internal
control within an established framework that applies within
the company.
Corporate Governance continued
Northamber Report and Accounts 2024
23
Strategic Report
Governance Report
Financial Statements
The Group’s control systems address key business and
financial risks. The Board considers the greatest risks to be
related to the realisable value of current assets, principally
inventories and trade receivables. Particular attention is paid
to all matters relating to purchasing, inventories, revenues,
trade receivables, cash, capital expenditure and foreign
exchange. Comprehensive documented procedures are
used and are available to all staff via the extensive computer
system.
A system of control is designed to manage rather than
eliminate the risk of failure to achieve business objectives,
and can only provide reasonable and not absolute assurance
against material misstatement or loss. As and when areas
of improvement are brought to the attention of the Board
and management steps are taken to further embed internal
control and risk management into the operations of the
business.
The Board has considered the need for internal audit but has
decided that because of the size of the Group it cannot be
justified at present.
During the year, the company installed a new ERP, warehouse
management and accounting system which will drive
efficiencies within the business and improve internal and
financial controls. The effectiveness of this will continue to be
reviewed in the forthcoming financial year.
Other Matters
The Directors have published the company’s Corporate
Governance policies which the Directors consider are relevant
to the company on the company’s website.
Induction programmes for new Directors are specifically
designed for each director as appointed as the content
varies depending on the background and experience of
the appointee. There is therefore no standard induction
programme for new Directors.
By order of the Board
S. Yoganathan ACMA
Company Secretary
20 November 2024
Corporate Governance continued
24
Northamber Report and Accounts 2024
Statement of Directors’ Responsibilities
The Directors are responsible for preparing the Strategic
Report, the Directors’ Report, and the financial statements in
accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and
company financial statements for each financial year.
Under that law the Directors are required by the AIM rules
of the London Stock Exchange to prepare Group financial
statements and have elected to prepare the parent company
financial statements, in accordance with international
accounting standards in conformity with the requirements of
the Companies Act 2006. The Group financial statements are
required by law and International Accounting Standards in
conformity with the requirement of the Companies Act 2006
to present fairly the financial position and performance of the
Group. The Companies Act 2006 provides in relation to such
financial statements that references in the relevant part of
that Act to financial statements giving a true and fair view
are references to their achieving a fair presentation. Under
company law the Directors must not approve the financial
statements unless they are satisfied that they give a true and
fair view of the state of affairs of the Group and the company
and profit or loss of 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 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
Group’s and the company’s transactions and disclose with
reasonable accuracy at any time the financial position of the
Group and the company and enable them to ensure that the
financial statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the
Group and the company and hence for taking reasonable
steps for the prevention and detection of fraud and other
irregularities.
The Directors are responsible for the maintenance and
integrity of the corporate and financial information included
on the company’s website. Legislation in the United Kingdom
governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
Northamber Report and Accounts 2024
25
Strategic Report
Governance Report
Financial Statements
Colin Mark
Thompson
Riccardo Reggio
Non executive director
Age 64
Colin Thompson has over
40 years’ experience in
the distribution sector,
and was a Director in
the Company from
September 1991 to
January 1999.
Committees:
Member of Remuneration
Committee
Member of Audit
Committee
Non-Executive Director
Age 53
Riccardo Reggio is an
experienced corporate
strategy and M&A adviser
who works with a variety
of companies to help
them achieve their
strategic goals.
Committees:
Member of Remuneration
Committee
Member of Audit
Committee
Directors and Advisers
Non-Executive Directors
Executive Directors
Jeremy Keefe
Managing Director
Age 60
(resigned 30 September
2024)
Jeremy Keefe has
over 30 years industry
experience and Joined
Northamber plc as
Managing Director in
January 2024.
Alexander Michael
Phillips
Executive Chairman
Age 38
Alex Phillips joined
Northamber Plc in 2014
as Director of Strategy,
was appointed as
Commercial Director in
February 2020, promoted
to Managing Director
in September 2020
and was appointed as
Executive Chairman in
January 2024.
26
Northamber Report and Accounts 2024
John Phelim Henry
Operations director
Age 62
John Henry joined
Northamber plc in 1992
in the Sales Department.
He was promoted to
Operations Director in
2012.
Advisers
Registered Office
Namber House
23 Davis Road,
Chessington
Surrey, KT9 1HS
Registrars
Computershare Investor
Services plc
The Pavilions,
Bridgewater Road
Bristol, BS13 8AE
Registered Auditor
Dains Audit Limited
2 Chamberlain Square,
Paradise Circus
Birmingham, B3 3AX
Bankers
Barclays Bank plc
6 Clarence Street
Kingston upon Thames
Surrey, KT1 1NY
Nominated Advisor &
Broker
Singer Capital Markets
One Bartholomew Lane
London, EC2N 2A
Directors and Advisers continued
Peter Dosanjh
Executive Director
Age 55
Peter Dosanjh joined
Northamber Plc in 2018
as Director of Sales,
was appointed as an
Executive Director in July
2022.
Antony Richard Lee
Finance director
Age 58
Antony Lee joined
Northamber plc in 2020
as Director of Finance
and was appointed as
Finance Director in 2021.
Northamber Report and Accounts 2024
27
Strategic Report
Governance Report
Financial Statements
Independent Auditor’s Report to The Members
of Northamber Plc
For the year ended 30 June 2024
Opinion
We have audited the financial statements of Northamber Plc
(the ‘parent company’) and its subsidiaries (the ‘Group’) for
the year ended 30 June 2024 which comprise the consolidated
statement of comprehensive income, the consolidated
and parent company statements of financial position, the
consolidated and parent company statements of changes in
equity, the consolidated and parent company statements of
cash flows, and notes to the financial statements, including
a summary of significant accounting policies. The financial
reporting framework that has been applied in the preparation
of the Group financial statements is applicable law and UK
adopted international accounting standards and, as regards
the parent company financial statements, as applied in
accordance with the provisions of the Companies Act 2006.
In our opinion:
• the financial statements give a true and fair view of the state
of the Group’s and of the parent company’s affairs as at
30 June 2024 and of the Group’s loss for the year then ended;
• the Group financial statements have been properly
prepared in accordance with UK adopted international
accounting standards;
• the parent company financial statements have been
properly prepared in accordance with UK adopted
international accounting standards; and
• the financial statements have been prepared in accordance
with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further described
in the Auditor responsibilities for the audit of the financial
statements section of our report. We are independent of the
Group and parent company in accordance with the ethical
requirements that are relevant to our audit of the financial
statements in the UK, including the FRC’s Ethical Standard
as applied to listed entities, and we have fulfilled our other
ethical responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Our approach to the audit
As part of designing our audit approach, we obtained
an understanding of the Group and its environment, we
determined materiality and assessed the risks of material
misstatement in the financial statements. In particular,
we looked at where the Directors made subjective judgments,
for example in respect of significant accounting estimates
that involved making assumptions and considering future
events that are inherently uncertain. As in all of our audits
we also addressed the risk of management override of internal
controls, including evaluating whether there was evidence
of bias by the Directors that represented a risk of material
misstatement due to fraud.
We tailored the scope of our audit to ensure that we performed
enough work to be able to give an opinion on the financial
statements as a whole, taking into account the structure of the
Group and the parent company, the accounting processes
and controls, and the industry in which they operate.
In establishing the overall approach to the Group audit, we
assessed the audit significance of each reporting unit in the
Group by reference to both its financial significance and other
indicators of audit risk, such as complexity of operations and
the degree of estimation and judgement in the financial results.
The Group financial statements are a consolidation of seven
reporting units, comprising the Group’s operating businesses
and property holding companies.
The Group audit team performed full scope audits of
the complete financial information of Northamber Plc,
Audio Visual Material Limited, Anitass Limited, Tempura
Communications Ltd and Tempura Connect Ltd which are
considered to be the Group’s significant components and
which accounted for 97% of the Group’s total revenue and
assets. The remaining components were not significant and
so were subject to analytical review procedures and specified
audit procedures over certain account balances and
transaction classes by the group engagement team.
Key audit matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the
financial statements of the current period and include the
most significant assessed risks of material misstatement
(whether or not due to fraud) we identified, including those
which had the greatest effect on the overall audit strategy,
the allocation of resources in the audit; and directing the
efforts of the engagement team. These matters were
addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.
28
Northamber Report and Accounts 2024
Key audit matters
How our scope addressed this matter
Business combination
During the year the group acquired the entire issue share
capital of Tempura Technology Limited and Tempura
Communications Limited (collectively “Tempura”).
The directors have to make a number of judgements
concerning the purchase consideration, given that an
element of the consideration is contingent, and the fair value
of separately identifiable intangibles assets and resulting
goodwill which arise on consolidation.
Details of the business combination are provided in note 23.
We carried out a review of the fair value of the assets and
liabilities acquired as identified by the directors.
We reviewed management calculations used to estimate the
value of the customer list, including customer attrition rates
and we compared these to post acquisition actual events
and similar previous comparable acquisitions.
We reviewed management’s assessment of the contingent
consideration to be paid by considering the post acquisition
performance of the acquired entities together with agreed
budgets and forecasts.
Nothing has come to our attention that causes us to believe
that the business combination has not been accounted for
appropriately.
Impairment of goodwill and other intangible assets (Group)
The Group has goodwill and other intangible assets with a
carrying value of £3.933m which arise from the acquisitions of
Audio Visual Material Limited and Tempura.
In accordance with accounting standards goodwill is not
amortised but is subject to an annual impairment review
through assessment of the value in use. The determination of
the value in use to which the goodwill and intangible assets
are allocated involves management judgment and estimates
including the discount rate and both short term and long
term growth rates.
Furthermore the group has now recorded operating losses
for three successive years. We therefore consider that there
are indicators that impairments may be present and as such
there is a risk that goodwill and other intangibles may be
materially misstated.
Management have concluded that no impairment is
necessary.
We have tested the judgements made by management
in undertaking the impairment tests which included, but is
not limited to, identifying the cash generating units (CGUs),
assessing the reasonableness of the discount rate used,
comparing the forecasts to information used to assess
going concern and challenging the robustness of the key
assumptions including those around revenue growth.
We also performed our own sensitivity analysis on
managements impairment model to consider the impact
of other plausible scenarios and we considered whether the
related financial statement disclosures set out in notes 2 and
11 were adequate and appropriate.
Nothing has come to our attention to suggest that the
impairment conclusions reached by management are not
appropriate.
Valuation of investment in Audio Visual Material and Tempura (Company)
There is a risk that if there are any impairment indicators that
would impact the carrying value of the CGU in the group
financial statements, these may also impact the carrying
value of the investments in the parent company financial
statements which have a carrying amount of £7.211m.
Our audit procedures included but were not limited to
considering the results of the assessment for impairment
indicators of the goodwill and other intangible assets detailed
above and evaluating whether the relevant disclosures in the
financial statements set out in notes 2 and 17 were adequate
and appropriate.
Nothing has come to our attention to suggest that the
impairment conclusions reached by management are not
appropriate.
Independent Auditor’s Report to The Members of Northamber Plc continued
Northamber Report and Accounts 2024
29
Strategic Report
Governance Report
Financial Statements
Key audit matters
How our scope addressed this matter
Revenue recognition
There is a rebuttable presumption that revenue recognition
gives rise to a risk of material misstatement. Revenue
recognition is therefore regarded as a key audit matter.
We have assessed the Group’s revenue accounting policy
as disclosed in note 2 to the financial statements to ensure
revenue is recognised at the point when the satisfaction of
performance obligations is fulfilled.
We have documented and evaluated the revenue processes
within the Group to ensure that the capture of revenue data is
accurate and within the correct accounting period.
We have specifically tested the completeness of revenue,
tracing a sample of customer orders from delivery note to
invoice.
Nothing has come to our attention to suggest that revenue is
not recognised appropriately.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that
the directors’ use of the going concern basis of accounting in
the preparation of the financial statements is appropriate.
To evaluate the directors’ assessment of the Group’s ability
to continue to adopt the going concern basis of accounting,
we completed the following audit procedures:
• obtained an understanding of the relevant controls relating
to the Group’s budgeting and forecasting process;
• challenged the key assumptions underpinning the Group’s
forecasts; and
• assessed the appropriateness of the Group’s disclosure
concerning the adoption of the going concern basis of
accounting.
The Directors’ forecasts demonstrate that the Group can
continue to trade for a period of at least 12 months from the
date of approval of the financial statements.
We have reviewed the disclosures prepared by the Directors
set out in Note 2 and consider them to be appropriate.
Based on the work we have performed, we have not identified
any material uncertainties relating to events or conditions
that, individually or collectively, may cast significant doubt on
the Group’s ability to continue as a going concern for a period
of at least twelve months from when the financial statements
are authorised for issue.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
Our application of materiality
The scope of our audit was influenced by our application
of materiality. We set certain quantitative thresholds for
materiality. These, together with qualitative considerations,
helped us to determine the scope of our audit and the nature,
timing and extent of our audit procedures on the individual
financial statement line items and disclosures and in
evaluating the effect of misstatements, both individually and
in aggregate on the financial statements as a whole.
We apply the concept of materiality, both in planning
and performing our audit and in evaluating the effect of
misstatements. We consider materiality to be the magnitude
by which misstatements, including omissions, could influence
the economic decisions of reasonable users that are taken on
the basis of the financial statements.
Independent Auditor’s Report to The Members of Northamber Plc continued
30
Northamber Report and Accounts 2024
Independent Auditor’s Report to The Members of Northamber Plc continued
Based on our professional judgment, we determined materiality for the financial statements as a whole as follows:
Group financial statements
Company financial statements
Materiality
£840,000 (2023: £1,005,000).
£750,000 (2023: £925,000).
How we determined materiality
1.5% (2023: 1.5%) of Group revenue
1.5% (2023: 1.5%) of company revenue
Rationale for benchmark
applied
We believe that revenue is the primary
measure used by shareholders in assessing
performance.
We believe that revenue is the primary
measure used by shareholders in assessing
performance.
Performance materiality
£714,000 (2023: £754,000).
£638,000 (2023: £694,000).
How we determined
performance materiality
Performance materiality is set to reduce to
an appropriately low level the probability
that the aggregate of uncorrected and
undetected misstatements exceeds
materiality for the financial statements as
a whole.
Having considered a number of factors
including the control environment, we have
set performance materiality at 85% (2023:
75%) of materiality.
Performance materiality is set to reduce to
an appropriately low level the probability
that the aggregate of uncorrected and
undetected misstatements exceeds
materiality for the financial statements as
a whole.
Having considered a number of factors
including the control environment, we
have set performance materiality at 85%
(2023: 75%) of materiality.
Component materiality
For each component in the scope of our Group audit, we
allocated a materiality that is less than our overall Group
materiality. The range of materiality allocated across
components was between £2,000 and £750,000.
We agreed with the Audit Committee that we would
report to them misstatements identified during our audit
above £42,000 (Group audit) (2023 - £50,000) and £38,000
(Company audit) (2023 - £48,000) as well as misstatements
below those amounts that, in our view, warranted reporting for
qualitative reasons.
Other information
The other information comprises the information included in
the annual report other than the financial statements and
our auditor’s report thereon. The directors are responsible
for the other information contained within the annual report.
Our opinion on the financial statements does not cover the
other information and, except to the extent otherwise explicitly
stated in our report, we do not express any form of assurance
conclusion thereon.
Our responsibility is to read the other information and, in
doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge
obtained in the course of the audit, or otherwise appears
to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements,
we are required to determine whether this gives rise to
a material misstatement in the financial statements
themselves. If, based on the work we have performed, we
conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the
Companies Act 2006
In our opinion, based on the work undertaken in the course of
the audit:
• the information given in the Strategic Report and the
Directors’ Report for the financial year for which the
financial statements are prepared is consistent with the
financial statements; and
• the Strategic report and the Directors’ Report have been
prepared in accordance with applicable legal requirements.
Matters on which we are required to report by
exception
In the light of the knowledge and understanding of the
Group and parent company and its environment obtained
in the course of the audit, we have not identified material
misstatements in the Strategic Report or the Directors’ Report.
Northamber Report and Accounts 2024
31
Strategic Report
Governance Report
Financial Statements
We have nothing to report in respect of the following matters
in relation to which the Companies Act 2006 requires us to
report to you if, in our opinion:
• adequate accounting records have not been kept by the
parent company, or returns adequate for our audit have
not been received from branches not visited by us; or
• the parent company financial statements are not in
agreement with the accounting records and returns; or
• certain disclosures of Directors’ remuneration specified by
law are not made; or
• we have not received all the information and explanations
we require for our audit.
Responsibilities of Directors
As explained more fully in the Directors’ responsibilities
statement set out on page 25, the Directors are responsible
for the preparation of the financial statements and for being
satisfied that they give a true and fair view, and for such
internal control as the Directors determine is necessary to
enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are
responsible for assessing the Group’s and parent company’s
ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the
going concern basis of accounting unless the Directors either
intend to liquidate the Group or the parent company or to
cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the
financial statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance but is not a guarantee
that an audit conducted in accordance with ISAs (UK) will
always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of
users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non‑compliance
with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material
misstatements in respect of irregularities, including fraud.
The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below:
Our approach to identifying and assessing the risks of
material misstatement in respect of irregularities, including
fraud and non-compliance with laws and regulations, was as
follows:
• the senior statutory auditor ensured that the engagement
team collectively had the appropriate competence,
capabilities and skills to identify or recognise
non‑compliance with applicable laws and regulations;
• we identified the laws and regulations applicable to
the Group through discussions with directors and other
management, and from our commercial knowledge and
experience of the distribution sector;
• we focused on specific laws and regulations which we
considered may have a direct material effect on the
financial statements or the operations of the Group,
including the financial reporting legislation, Companies
Act 2006, the AIM listing rules, taxation legislation, anti-bribery,
employment, and environmental and health and safety
legislation;
• we assessed the extent of compliance with the laws and
regulations identified above through making enquiries of
management and inspecting legal correspondence; and
• identified laws and regulations were communicated within
the audit team regularly and the team remained alert to
instances of non-compliance throughout the audit.
We assessed the susceptibility of the Group’s financial
statements to material misstatement, including obtaining an
understanding of how fraud might occur, by:
• making enquiries of management as to where they
considered there was susceptibility to fraud, their
knowledge of actual, suspected and alleged fraud; and
• considering the internal controls in place to mitigate risks
of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and
override of controls, we:
• performed analytical procedures to identify any unusual or
unexpected relationships;
• tested journal entries to identify unusual transactions;
• assessed whether judgements and assumptions made
in determining the accounting estimates set out in Note 2
were indicative of potential bias; and
• investigated the rationale behind significant or unusual
transactions.
Independent Auditor’s Report to The Members of Northamber Plc continued
32
Northamber Report and Accounts 2024
In response to the risk of irregularities and non-compliance
with laws and regulations, we designed procedures which
included, but were not limited to:
• agreeing financial statement disclosures to underlying
supporting documentation;
• reading the minutes of meetings of those charged with
governance;
• enquiring of management as to actual and potential
litigation and claims; and
• reviewing correspondence with HMRC, relevant regulators
and the company’s legal advisors.
Because of the inherent limitations of an audit, there is a risk
that we will not detect all irregularities, including those leading
to a material misstatement in the financial statements or
non-compliance with regulation. This risk increases the more
that compliance with a law or regulation is removed from the
events and transactions reflected in the financial statements,
as we will be less likely to become aware of instances of
non‑compliance. The risk is also greater regarding irregularities
occurring due to fraud rather than error, as fraud involves
intentional concealment, forgery, collusion, omission or
misrepresentation.
A further description of our responsibilities for the audit of the
financial statements is located on the Financial Reporting
Council’s website at: www.frc.org.uk/auditorsresponsibilities.
This description forms part of our auditor’s report.
Use of this report
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.
Mark Hargate FCA (Senior Statutory Auditor)
For and on behalf of Dains Audit Limited
Statutory Auditor and Chartered Accountants
Birmingham
20 November 2024
Independent Auditor’s Report to The Members of Northamber Plc continued
Northamber Report and Accounts 2024
33
Strategic Report
Governance Report
Financial Statements
Financial
Statements
In this section
Statement of Comprehensive Income
35
Statements of Changes in Equity
36
Statements of Financial Position
38
Statements of Cash Flows
40
Notes to the Financial Statements
42
Northamber Report and Accounts 2024
34
Consolidated Statement of Comprehensive Income
For the year ended 30 June 2024
Notes
2024
£’000
2023
£’000
Revenue
3
56,008
67,149
Cost of sales
(47,969)
(58,243)
Gross Profit
8,039
8,906
Distribution costs
(5,308)
(5,907)
Administrative costs
(4,147)
(3,491)
Operating Loss
4
(1,416)
(492)
Finance income
87
81
Finance cost
-
-
Loss before tax
(1,329)
(411)
Tax expense
6
-
-
Loss for the year and total comprehensive income
attributable to the owners
(1,329)
(411)
Basic and diluted Loss per ordinary share
8
(4.85)p
(1.51)p
The above results arise from continuing operations
The notes on pages 42 to 62 form part of the financial statements
Northamber Report and Accounts 2024
35
Strategic Report
Financial Statements
Governance Report
Share
Capital
£’000
Share
Premium
Account
£’000
Capital
Redemption
Reserve
£’000
Retained
Earnings
£’000
Total
Equity
£’000
Balance at 1 July 2022
272
5,734
1,514
16,931
24,451
Dividends
-
-
-
(163)
(163)
Transactions with owners
-
-
-
(163)
(163)
Loss and total comprehensive income
for the year
-
-
-
(411)
(411)
Balance at 30 June 2023
272
5,734
1,514
16,357
23,877
Issue of Shares
2
98
-
-
100
Dividends
-
-
-
(163)
(163)
Transactions with owners
2
98
-
(163)
(63)
Loss and total comprehensive income
for the year
-
-
-
(1,329)
(1,329)
Balance at 30 June 2024
274
5,832
1,514
14,865
22,485
Consolidated Statement of Changes in Equity
For the year ended 30 June 2024
36
Northamber Report and Accounts 2024
Company Statement of Changes in Equity
For the year ended 30 June 2024
Share
Capital
£’000
Share
Premium
Account
£’000
Capital
Redemption
Reserve
£’000
Retained
Earnings
£’000
Total
Equity
£’000
Balance at 1 July 2022
272
5,734
1,514
4,534
12,054
Dividends
-
-
-
(163)
(163)
Transactions with owners
-
-
-
(163)
(163)
Loss and total comprehensive loss for the year
-
-
-
(725)
(725)
Balance at 30 June 2023
272
5,734
1,514
3,646
11,166
Issue of Shares
2
98
-
-
100
Dividends
-
-
-
(163)
(163)
Transactions with owners
2
98
-
(163)
(63)
Loss and total comprehensive income
for the year
-
-
-
(1,905)
(1,905)
Balance at 30 June 2024
274
5,832
1,514
1,578
9,198
Northamber Report and Accounts 2024
37
Strategic Report
Financial Statements
Governance Report
Consolidated Statement of Financial Position
At 30 June 2024
Notes
2024
£’000
2023
£’000
Non-current assets
Property, plant and equipment
9
5,835
5,519
Intangible assets
11
3,933
1,251
9,768
6,770
Current assets
Inventories
12
11,838
11,447
Trade and other receivables
13
12,107
12,099
Cash and cash equivalents
14
4,687
5,512
28,632
29,058
Total assets
38,400
35,828
Current liabilities
Trade and other payables
15
(15,459)
(11,951)
Corporation tax payable
-
-
Non-current liabilities
Deferred tax liability
6
(456)
-
Total liabilities
(15,915)
(11,951)
Net assets
22,485
23,877
Equity
Share capital
16
274
272
Share premium account
5,832
5,734
Capital redemption reserve
1,514
1,514
Retained earnings
14,865
16,357
Equity shareholders’ funds attributable to the owners of the parent
22,485
23,877
The financial statements on pages 35 to 62 are authorised for issue and were approved by the Board of Directors on
20 November 2024 and were signed on its behalf by:
A.R. Lee
P. Dosanjh
Director
Director
Company Registration number: 01499584
38
Northamber Report and Accounts 2024
Company Statement of Financial Position
At 30 June 2024
Notes
2024
£’000
2023
£’000
Non-current assets
Property, plant and equipment
10
1,586
1,620
Intangible assets
11
324
-
Investments
17
7,211
2,135
9,121
3,755
Current assets
Inventories
12
8,014
10,456
Trade and other receivables
13
9,497
11,852
Cash and cash equivalents
14
3,559
5,240
21,070
27,548
Total assets
30,191
31,303
Current liabilities
Trade and other payables
15
(20,993)
(20,137)
Corporation tax payable
-
-
Total liabilities
(20,993)
(20,137)
Net assets
9,198
11,166
Equity
Share capital
16
274
272
Share premium account
5,832
5,734
Capital redemption reserve
1,514
1,514
Retained earnings
1,578
3,646
Equity shareholders’ funds attributable to the owners of the parent
9,198
11,166
The loss after tax for the parent company was £1,905,000 (2023: £725,000)
The financial statements on pages 35 to 62 are authorised for issue and were approved by the Board of Directors on
20 November 2024 and were signed on its behalf by:
A.R. Lee
P. Dosanjh
Director
Director
Company Registration number: 01499584
Northamber Report and Accounts 2024
39
Strategic Report
Financial Statements
Governance Report
Consolidated Statement of Cash Flows
For the year ended 30 June 2024
Notes
2024
£’000
2023
£’000
Cash flows from operating activities
Operating Loss from continuing operations
(1,416)
(492)
Depreciation of property, plant and equipment
4
180
357
Amortisation of intangible assets
4
128
58
Profit on disposal of property, plant and equipment
-
(74)
Operating loss before changes in working capital
(1,108)
(151)
Decrease/(Increase) in inventories
2,588
(798)
Decrease/(Increase) in trade and other receivables
2,193
(854)
(Decrease)/Increase in trade and other payables
(3,942)
1,622
Cash used in operations
(269)
(181)
Income taxes paid
-
(38)
Net cash used in operating activities
(269)
(219)
Cash flows from investing activities
Interest received
87
81
Proceeds from disposal of Property, plant and equipment
-
1,475
Purchase of subsidiaries (net of cash acquired)
(2,865)
-
Purchase of property, plant equipment
(40)
(358)
Purchase of software
(395)
-
Net cash generated from/(used in) investing activities
(3,213)
1,198
Cash flows from financing activities
Dividends paid to equity shareholders
7
(163)
(163)
Interest Paid
-
-
New invoice discounting facility
2,820
-
Net cash generated from/(used in) financing activities
2,657
(163)
Net (decrease)/increase in cash and cash equivalents
(825)
816
Cash and cash equivalents at beginning of year
14
5,512
4,696
Cash and cash equivalents at end of year
14
4,687
5,512
40
Northamber Report and Accounts 2024
Company Statement of Cash Flows
For the year ended 30 June 2024
2024
£’000
2023
£’000
Cash flows from operating activities
Operating Loss from continuing operations
(1,993)
(804)
Depreciation of property, plant and equipment
221
163
Profit on disposal of property, plant and equipment
-
-
Operating loss before changes in working capital
(1,772)
(641)
Decrease/(Increase) in inventories
2,442
(767)
Decrease /(Increase) in trade and other receivables
2,355
(327)
(Decrease)/Increase in trade and other payables
(3,628)
3,086
Cash used in/generated from operations
(603)
1,351
Income taxes paid
-
-
Net cash (used in)/generated from operating activities
(603)
1,351
Cash flows from investing activities
Interest received
88
79
Purchase of property, plant and equipment
(511)
(131)
Purchase of subsidiaries
(3,312)
-
Increase of share capital
-
-
Proceeds from disposal of property, plant and equipment
-
-
Net cash used in investing activities
(3,735)
(52)
Cash flows from financing activities
Dividends paid to equity shareholders
(163)
(163)
New invoice discounting facility
2,820
-
Net cash generated from/(used in) financing activities
2,657
(163)
Net (decrease)/increase in cash and cash equivalents
(1,681)
1,136
Cash and cash equivalents at beginning of year
5,240
4,104
Cash and cash equivalents at end of year
3,559
5,240
Northamber Report and Accounts 2024
41
Strategic Report
Financial Statements
Governance Report
Notes to the Financial Statements
For the year ended 30 June 2024
1. General information
Northamber plc is a public limited company incorporated and
domiciled in the England and Wales under the Companies
Act 2006 and is listed on the London Stock Exchange on the
Alternative Investment Market. The address of the registered
office is given on page 27. The nature of the company’s
operations and its principal activities are set out in the
Strategic Report and the Directors’ Report on pages 6 to 16.
2. Significant accounting policies
Basis of accounting
The financial statements have been prepared in accordance
with UK-adopted international accounting standards in
conformity with the requirements of the Companies Act 2006.
The financial statements have been prepared under the
historical cost basis. The functional and presentational
currency of the Group is pounds sterling. The figures have
been rounded to the nearest one thousand pounds.
Basis of consolidation
The consolidated financial statements incorporate the
financial statements of Northamber plc and entities controlled
by Northamber plc. Control is achieved if all three of the
following are achieved: power over the investee, exposure to
variable returns for the investee, and the ability of the investor
to use its power to affect those variable returns.
The results of subsidiaries are included in the consolidated
statement of comprehensive income and consolidated
statement of financial position.
The results of entities acquired or disposed of during the year
are included in the consolidated statement of comprehensive
income from the effective date of acquisition or up to the
effective date of disposal, as appropriate.
Where necessary, the accounts of the subsidiaries are
adjusted to conform to the group’s accounting policies.
All intra-group transactions, balances, income and expenses
are eliminated on consolidation.
New and amended standards adopted by the
Group
The Group has applied the following new standards and
interpretations for the first time for the annual reporting period
ended 30 June 2024:
• IAS 1 Amendment: Disclosure of Accounting Policies
• IAS 8 Amendment: Definition of Accounting Estimates
• IAS 1 Amendment: Classification of Liabilities as Current or
Non-current and Non-current Liabilities with Covenants
• IAS 12 Amendment: Deferred Tax related to Assets and
Liabilities arising from a Single Transaction
• IFRS 16 (Amendment: Lease Liability in a Sale and Leaseback
The adoption of the standards and interpretations listed
above has not led to any changes to the Group’s accounting
policies or had any material impact on the financial position
or performance of the Group.
Standards issued but not yet effective
At the date of authorisation of these financial statements, the
following standards and interpretations relevant to the Group
and which have not been applied in the financial statements,
were in issue but were not yet effective.
IFRS standards effective from 1 January 2024 onwards
• IAS 1 Amendment: Non-current liabilities with covenants
• IFRS16 Amendment: Lease liability in a sale and leaseback
• IAS7 and IFRS7 Amendment: Supplier finance arrangements
The adoption of the above mentioned standards,
amendments and interpretations in future years are not
expected to have a material impact on the Group or
Company’s financial statements.
Critical accounting judgements and other key
sources of estimation uncertainty
In the process of applying the Group’s accounting policies,
the Group is required to make certain estimates, judgements
and assumptions that it believes are reasonable based upon
the information available. These estimates and assumptions
affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of
revenue and expenses during the periods presented.
On an ongoing basis, the Group evaluates its estimates
using historical experience, consultation with experts and
other methods considered reasonable in the particular
circumstances. Actual results may differ from the estimates,
the effect of which is recognised in the period in which the
facts that give rise to the revision become known. The Group
believes that the estimates and judgements in relation to
goodwill and intangible assets have the most significant
impact on the annual results under IFRS as set out below.
Business Combination
Following the acquisition of Tempura Communications
Limited and Tempura Technology Limited, the Directors have
to make a number of judgements concerning the purchase
42
Northamber Report and Accounts 2024
consideration, given that an element of the consideration is
contingent, and the separately identifiable intangibles and
resulting goodwill. The Directors have assessed the contingent
consideration to be paid by considering the post acquisition
performance of the acquired entities together with agreed
budgets and forecasts. The Directors have estimated the
value of the customer list, taking into account expected
customer attrition rates, and have compared this to pre and
post acquisition actual events.
Impairment of intangible assets including goodwill
Goodwill is not amortised but is subject, at a minimum, to
annual tests for impairment or if there has been an indication
of any impairment in the year. The initial goodwill recorded
and subsequent impairment review require management
to make subjective judgements concerning the value in use
of cash-generating units. This requires an estimate of the
future cash flows expected to arise from the cash-generating
unit and a suitable discount rate to calculate present value.
The carrying amount at the end of the reporting period is
£3,933,000 and details of the assumptions made are provided
in note 11. No impairment has been identified during the year
or at year end.
Impairment of Investment – Parent entity
The Directors assess the recoverability of investments
in subsidiaries at the reporting date by reference to the
profitability and its net asset position. Impairment reviews
require management to make subjective judgements
concerning the future cash flows arising from the subsidiary.
Estimates over the future cash flows are made by
management. Where applicable, investments in subsidiaries
are impaired down to the amount assessed as recoverable.
Directors have made an estimate of the future cash flows
expected to arise from the investment and a suitable
discount rate to calculate present value. The carrying amount
at the end of the reporting period is £7,211,000, the details of
the assumptions made are provided in note 11 as these are
the same as the goodwill impairment review. No impairment
has been identified during the year or at year end.
The principal accounting policies adopted are set out below.
Revenue recognition
Revenue is measured at the fair value of the consideration
received or receivable for goods provided in the normal
course of business, net of discounts, VAT and other sales
related taxes.
Nearly all the Group’s revenues relate to the sale of goods,
and the performance obligation under contracts with
customers is satisfied on shipment of goods to the customer.
Payment terms are varying between 30 and 90 days.
The Group has determined therefore that revenue on sale of
goods is recognised at the date the delivery of goods to the
customer leaves the warehouse. Revenue is recognised at a
point in time.
The Group has a very small level of revenue from the provision
of services, mainly assisting customers with the installation of
equipment. The performance obligation in this case is satisfied
on installation and is recognised as revenue at that point.
The company makes bill and hold sales, in which delivery is
delayed at the buyer’s request but the buyer takes title to
and risk in the goods, and accepts billing. This is on the basis
that (a) the reason for the bill-and-hold arrangement must
be substantive (for example, the customer has requested the
arrangement); (b) the product must be identified separately
as belonging to the customer; (c) the product currently must
be ready for physical transfer to the customer; and (d) the
company cannot have the ability to use the product or to
direct it to another customer. The revenue is recognised at the
time of invoicing, which is also when the goods are identified
and made ready for the buyer and despatched.
Revenues are stated after discounts, rebates, price reductions
and provision for estimated levels of returns. Customers only
have a right to return goods in accordance with contractual
terms. Warranties are provided directly by the Group’s
suppliers to customers.
Investment revenue is accrued on a time basis in accordance
with the effective interest rate method.
Foreign currencies
Transactions in currencies other than pounds sterling, the
functional currency of all Group entities, are recorded at the
rates of exchange prevailing on the date of the transactions.
At each reporting date, monetary assets and liabilities that
are denominated in foreign currencies are retranslated at the
rates prevailing on the reporting date. Exchange differences
arising on the settlement of monetary items, and on the
retranslation of monetary items, are included in profit or loss
for the period.
Loss from operations
Loss from operations is stated before investment income and
finance costs.
Notes to the Financial Statements continued
Northamber Report and Accounts 2024
43
Strategic Report
Financial Statements
Governance Report
Retirement benefit costs
Payments to defined contribution retirement benefit schemes
are charged as an expense in the period in which they
are incurred. The Group has no defined benefit retirement
schemes.
Taxation
The tax expense represents the sum of the tax currently
payable and deferred tax.
The tax currently payable is based on the taxable profit for the
year. Taxable profit differs from net profit as reported in the
profit or loss because it excludes items of income or expense
that are taxable or deductible in other years and it further
excludes items that are never taxable or deductible. The
company’s liability for current tax is calculated using tax rates
that have been enacted, or substantively enacted, by the
reporting date.
Deferred tax is the tax expected to be payable or recoverable
on differences between the carrying amounts of assets and
liabilities in the financial statements and the corresponding
tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognised for all
taxable temporary differences and deferred tax assets are
recognised to the extent that it is probable that taxable
profits will be available against which deductible temporary
differences can be utilised. Such assets and liabilities are not
recognised if the temporary differences arise from the initial
recognition of goodwill or from the initial recognition (other
than in a business combination) of other assets and liabilities
in a transaction that affects neither the tax profit nor the
accounting profit.
The carrying amount of deferred tax assets is reviewed at
each reporting date and reduced to the extent that it is no
longer probable that sufficient taxable profits will be available
to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are
substantively enacted in the period when the liability is settled
or the asset is realised. Deferred tax is charged or credited to
the profit or loss, except when it relates to items charged or
credited directly to equity, in which case the deferred tax is
also dealt with in equity.
Deferred tax balances have not been discounted.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes by
the same taxation authority and the Group intends to settle its
current tax assets and liabilities on a net basis.
Business combinations
The acquisition of subsidiaries and businesses is accounted
for using the acquisition method.
Measurement of consideration
The consideration for each acquisition is measured at the
aggregate of the fair values, at the date of exchange, of
assets given, liabilities incurred or assumed, and equity
instruments issued by the Group in exchange for control of
the acquiree.
Contingent consideration is initially measured at fair value
at the date of the business combination. Any subsequent
adjustment to this fair value (such as meeting an earnings
target), where the consideration is payable in cash, is
recognised in the consolidated statement of comprehensive
income.
Fair value assessment
Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured
initially at their fair values at the acquisition date. Where the
fair value of the assets and liabilities at acquisition cannot be
determined reliably in the initial accounting, these values are
considered to be provisional for a period of 12 months from
the date of acquisition. If additional information relating to
the condition of these assets and liabilities at the acquisition
date is obtained within this period, then the provisional values
are adjusted retrospectively. This includes the restatement of
comparative information for prior periods.
Goodwill arises where the cost of the business combination
exceeds the Group’s interest in the net fair value of the
identifiable assets, liabilities and contingent liabilities
recognised. This is recognised as an asset and is subject to
impairment tests as noted in note 11.
Acquisition costs
Acquisition costs are recognised in the consolidated
statement of comprehensive income as incurred and
separately disclosed due to the nature of this expense.
Goodwill
Goodwill arising on consolidation is recognised as an asset.
Following initial recognition, goodwill is subject to impairment
reviews, at least annually or if there is an indication of
impairment and measured at cost less accumulated
impairment losses. Any impairment is recognised immediately
in the consolidated statement of comprehensive income and
is not subsequently reversed.
Notes to the Financial Statements continued
44
Northamber Report and Accounts 2024
On disposal of a subsidiary the attributable amount of
goodwill is included in the determination of the gain or loss on
disposal.
Other intangible assets
Other intangible assets are measured initially at cost and
are amortised on a straight-line basis over their estimated
useful lives.
The carrying amount is reduced by any provision for
impairment where necessary.
On a business combination, as well as recording separable
intangible assets already recognised in the balance sheet of
the acquired entity at their fair value, identifiable intangible
assets that are separable or arise from contractual or other
legal rights are also included in the acquisition balance sheet
at fair value.
Amortisation is charged within administrative expenses in the
consolidated statement of comprehensive income so as to
write off the cost or valuation of assets over their estimated
useful lives, on the following basis:
Intangible assets arising on acquisitions
Brands
7 years straight line
Customer relationships
7 years straight line
Property, plant and equipment
Land and buildings are held for use in the production or
supply of goods and services, or for administrative purposes
and are stated in the balance sheet at cost less accumulated
depreciation and impairment losses.
Plant and equipment are stated at cost less accumulated
depreciation and any recognised impairment loss.
Depreciation is charged so as to write off the cost of assets
less any residual value, other than land, over their estimated
useful lives, using the straight line method, on the following
bases:
Land and Buildings:
Freehold premises
(Northamber)
4% on freehold buildings,
freehold improvements 25%
straight line
Freehold premises
(Anitass Ltd)
2.5% on freehold buildings,
freehold improvements 25%
straight line
Plant and equipment
25% straight line
The gain or loss arising on the disposal or retirement of an
asset is determined as the difference between the sales
proceeds and the carrying amount of the asset and is
recognised in profit or loss.
Material residual value estimates are updated as required,
but at least annually.
Impairment of tangible and intangible assets
At each balance sheet date, the Group reviews the carrying
amounts of its tangible and intangible assets to determine
whether there is any indication that those assets have
suffered an impairment loss. If any such indication exists,
the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any). Where the
asset does not generate cash flows that are independent from
other assets, the Company estimates the recoverable amount
of the cash generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to
sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value
using a pre tax discount rate that reflects current market
assessments of the time value of money and the risks specific
to the asset for which the estimates of future cash flows have
not been adjusted.
If the recoverable amount of an asset (or cash generating
unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (or cash generating unit) is
reduced to its recoverable amount. An impairment loss is
recognised as an expense immediately, unless the relevant
asset is carried at a revalued amount, in which case the
impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying
amount of the asset (cash generating unit) is increased to
the revised estimate of its recoverable amount, but so that
the increased carrying amount does not exceed the carrying
amount that would have been determined had no impairment
loss been recognised for the asset (cash generating unit) in
prior years. A reversal of an impairment loss is recognised as
income immediately, unless the relevant asset is carried at a
revalued amount, in which case the reversal of the impairment
loss is treated as a revaluation increase.
Inventories
Inventories are stated at the lower of cost and net realisable
value. Cost is on the FIFO basis and comprises finished goods
and goods for resale. Net realisable value represents the
estimated selling price less costs to be incurred in marketing,
selling and distribution.
Notes to the Financial Statements continued
Northamber Report and Accounts 2024
45
Strategic Report
Financial Statements
Governance Report
Cost of inventories is based on original cost as amended by
credits subsequently received or agreed with suppliers in
respect of specific products. The provision for obsolete and
slow moving stock is determined by frequent and regular
reviews of stock, its ageing and rate of sale. Provisions are
made which enable such obsolete stock as not returned to
suppliers and slow moving stock to be sold at no loss.
Investments
Investments in subsidiaries are held at cost less any provision
for impairment.
Financial instruments
(i) Financial assets
The Group has one class of financial asset that is recorded at
amortised cost as detailed below.
These assets, which are held to collect, arise principally
from the provision of goods and services to customers (e.g.
trade receivables). Impairment provisions for current and
non-current trade receivables are recognised based on the
simplified approach with IFRS 9 using a provision matrix in the
determination of the lifetime expected credit losses. During
this process, the probability of the non-payment of the trade
receivables is assessed. The probability is then multiplied
by the amount of the expected loss arising from default to
determine the lifetime expected credit loss for the trade
receivables.
For trade receivables, which are reported net, such provisions
are recorded in a separate provision account with the loss
being recognised within administrative expenses in the
consolidated statement of comprehensive income. On
confirmation that the trade receivables will not be collectable,
the gross carrying value of the asset is written off against the
associated provision.
Credit insurance is used for the large majority of trade
receivables to mitigate against any potential risk of non-
payment. The point at which the trade receivable is de-
recognised, and an insurance asset is recognised under IAS37
when the economic benefit arising from the claim is virtually
certain.
Impairment provisions for receivables from related parties
and loans to related parties are recognised based on a
forward looking expected credit loss model. The methodology
used to determine the amount of the provision is based on
whether there has been a significant increase in credit risk
since initial recognition of the financial asset. For those where
the credit risk has not increased significantly since initial
recognition of the financial asset, twelve month expected
credit losses along with gross interest income are recognised.
For those for which credit risk has increased significantly,
lifetime expected credit losses along with the gross interest
income are recognised. For those that are determined to be
credit impaired, lifetime expected credit losses along with
interest income on a net basis are recognised.
The Group’s financial assets measured at amortised cost
comprise trade and other receivables and cash and cash
equivalents in the consolidated statement of financial
position. Cash and cash equivalents include cash in hand,
deposits held at call with banks and other short term highly
liquid investments.
(ii) Financial liabilities
The Group has one class of financial liability that is measured
at amortised cost as detailed below.
Trade payables are initially recognised at fair value, net of
any transaction costs directly attributable to the issue of the
instrument and are subsequently measured at amortised
cost using the effective interest method which ensures that
any interest expense and associated finance costs over the
period to repayment is at a constant rate on the balance of
the liability carried in the consolidated statement of financial
position. For the purpose of each financial liability, interest
expense includes initial transaction costs and any premium
payable on redemption as well as any interest payable while
the liability is outstanding. Contingent deferred consideration
is initially measured at fair value, with subsequent changes
recorded at fair value through profit and loss.
Equity instruments
Equity instruments issued by the Company are recorded at
fair value on initial recognition net of transaction costs.
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 the nominal value of
shares which have been redeemed
and cancelled.
Retained Earnings
– represents all current and prior
period retained profits and losses.
Notes to the Financial Statements continued
46
Northamber Report and Accounts 2024
The transaction costs of an equity transaction are accounted
for as a deduction from equity (net of any related income tax
benefit) to the extent that they are incremental costs directly
attributable to the equity transaction that otherwise would
have been avoided. The costs of an equity transaction that is
abandoned are recognised as an expense.
Where the Company purchases the Company’s equity share
capital (treasury shares), the consideration paid including
any directly attributable incremental costs is deducted from
equity attributable to the Company’s equity holders until the
shares are cancelled or re-issued.
Where shares are cancelled a corresponding transfer of the
nominal value of the shares cancelled is made to the capital
redemption reserve.
Capital management
The Group’s capital comprises equity, and its objectives when
managing capital are to safeguard the Group’s ability to
continue as a going concern in order to provide returns to
shareholders and to maintain an optimal capital structure.
In order to manage the capital structure the Group can
adjust the amount of dividends paid to shareholders,
purchase the Company’s shares, return capital to
shareholders or issue new shares.
In line with Group policy, the Group has no external debt
finance hence gearing is not measured. The company has
paid final and interim dividends in the year.
Equity comprises the items detailed within the principal
accounting policy for equity and financial details can be
found in the statement of financial position. The company
adheres to the capital maintenance requirements set out in
the Companies Act 2006.
Going Concern basis
The going concern basis of preparing the financial
statements has been adopted as in the view of the Directors,
as set out in the notes on Corporate Governance, the
company has adequate resources to continue in operational
existence for the foreseeable future. Please see Corporate
Governance Report for further information on page 23.
Segmental reporting
Management has determined that there is only one operating
segment of the Group as the total business of the company
is the sourcing and distribution of computer related products
and this is how information is reported to the Chief Operating
Decision Maker. The Board in carrying out its strategic
planning and decision making has, necessarily, to take
consideration of the inter relatedness of the product range
and the customer base and thus treat the operations of the
Group as a whole. All decisions on the allocation of resources
impacts on all aspects of the Group. Information presented to
the Chief Operating Decision Maker is the same as is reported
in these financial statements.
Leases
Leases of low-value assets or short-term leases are
immediately expensed in profit or loss.
Notes to the Financial Statements continued
3. Revenue
Although the sales of the Group are predominantly to the UK there are sales to other countries and the following table sets out
the split of the sales for the year. Revenue is attributed to individual countries based on the location of the customer.
Revenues comprise:
2024
£’000
2023
£’000
Revenue from contracts with customers – UK
55,339
66,489
Revenue from contracts with customers – Non UK
669
660
56,008
67,149
Revenue from contracts with customers comprises sale of goods which are recognised at a point in time and relate to electrical
or electronic products. Service revenues are immaterial.
No customer accounted for more than 10% of the Group’s revenue for the year.
All non-current assets are located in the country of domicile.
Northamber Report and Accounts 2024
47
Strategic Report
Financial Statements
Governance Report
4. Loss from operations
Operating loss is stated after charging:
2024
£’000
2023
£’000
Foreign exchange loss
76
29
Depreciation of property, plant and equipment
412
357
Amortisation of intangible assets
296
58
Fees paid to the company’s auditor
- for the audit of the company annual financial statements
57
55
- for the audit of subsidiary undertakings
38
8
Employee benefit expense
5,548
5,791
No profit and loss account for Northamber plc has been presented as permitted by Section 408 of the Companies Act 2006.
5. Staff costs
The average monthly number of persons (including executive Directors) employed by the Group during the year was:
2024
Number
2023
Number
Sales
45
57
Administration
35
38
Warehouse
11
12
Engineering
1
1
92
108
2024
£’000
2023
£’000
Their aggregate remuneration comprised:
Wages and salaries
4,840
4,987
Social security costs
531
608
Pension costs
128
140
Other benefits
49
56
5,548
5,791
All pension costs relate to defined contribution schemes.
Included in the above is key management personnel compensation as set out below. Full details of director’s remuneration
are set out in the Report to Shareholders by the Board of Directors’ Remuneration on page 17 to 18. The company has identified
the key management personnel as the executive and Non-Executive Directors and all their remuneration received amounts to
short-term employment benefits except for pension contributions.
Notes to the Financial Statements continued
48
Northamber Report and Accounts 2024
2024
£’000
2023
£’000
Remuneration
Salaries and Fees
528
438
Social security costs
60
48
Pension costs
33
31
Benefits
29
31
650
548
6. Tax expense
Group
2024
£’000
2023
£’000
Current taxation
Charge for the year
-
-
-
-
The charge for the year can be reconciled to the loss per the Statement of comprehensive income as follows:
Group
2024
£’000
2023
£’000
Loss on ordinary activities before tax
(1,329)
(411)
Tax at the UK corporation tax rate of 25.00% (2023:25.00%)
(385)
(103)
Profit on disposal of fixed assets
-
-
Capital gain
-
-
Non-deductible expenses
158
(3)
Sundry items
-
-
Use of post April 2017 losses brought forward
-
-
Loss available to carry forward
227
106
Total actual amount of charge for the year
-
-
The average main rate of corporation tax for the year ended 30 June 2024 was 25%.
The Group has tax losses of £5.4 million (2023: £4.1 million) to carry forward. No deferred tax asset is recognised in respect of the
losses as there is uncertainty over the timing of future taxable profits sufficient to utilise the losses. The unprovided deferred tax
asset in respect of these losses at a rate of 25% (2023: 25%) is approximately £1,300,000 (2023: £1,025,000).
Notes to the Financial Statements continued
Northamber Report and Accounts 2024
49
Strategic Report
Financial Statements
Governance Report
Deferred Tax
Deferred tax is calculated in full on temporary differences under the liability method using a tax rate of 25% (2023: 25%).
The movement on the deferred tax account is as shown below:
Group
2024
£’000
2023
£’000
At 1 July
-
-
Arising on business combination
456
-
At 30 June
456
-
See note 26 for further details of the deferred tax arising on business combination.
7. Dividends
Amounts recognised as distribution to equity holders in the period:
Dividends paid in year
2024
2023
Pence
Per Share
£’000
Pence
Per Share
£’000
Final – for year ended 30 June 2023 and
30 June 2022
0.30
82
0.30
82
Interim – for year ended 30 June 2024 and
30 June 2023
0.30
81
0.30
81
0.60
163
0.70
163
Proposed final for the year ended
30 June 2024 and 30 June 2023
0.30
82
0.30
82
The proposed final dividend is subject to approval at the Annual General Meeting and has not been included as a liability in
these financial statements.
8. Loss per ordinary share
The calculation of the basic and diluted loss per share is based on the following data:
2024
£’000
2023
£’000
Loss for the year attributable to equity holders of the parent company
(1,329)
(411)
Number of shares
2024
Number
2023
Number
Weighted average number of ordinary shares for the purpose of basic loss
per share and diluted loss per share
27,261,889
27,231,586
Basic and diluted loss per share is calculated by dividing the loss attributable to ordinary shareholders by the weighted average
number of ordinary shares in issue during the year.
Net assets per share, as disclosed within the summary of the last five years of trading, is calculated by dividing the net assets as
disclosed in the consolidated statement of financial position by the number of ordinary shares in issue at the year end.
Notes to the Financial Statements continued
50
Northamber Report and Accounts 2024
9. Property, plant and equipment
Land and
Buildings
£’000
Plant and
Equipment
£’000
Total
£’000
Group
Cost
At 1 July 2022
7,474
1,544
9,018
Additions
-
358
358
Disposals
(1478)
-
(1478)
At 30 June 2023
5,996
1,902
7,898
Depreciation
At 1 July 2021
1,382
717
2,099
Depreciation charge for the year
125
232
357
Disposals
(77)
-
(77)
At 30 June 2022
1,430
949
2,379
Net book value at 30 June 2023
4,566
953
5,519
Group
Cost
At 1 July 2023
5,996
1,902
7,898
Additions
13
639
652
Additions from business combination
738
738
Disposals
-
(612)
(612)
At 30 June 2024
6,009
2,667
8,676
Depreciation
At 1 July 2023
1,430
949
2,379
Depreciation charge for the year
79
339
418
Depreciation from business combination
282
282
Disposals
-
(238)
(238)
At 30 June 2024
1,509
1,332
2,841
Net book value at 30 June 2024
4,500
1,335
5,835
Notes to the Financial Statements continued
Northamber Report and Accounts 2024
51
Strategic Report
Financial Statements
Governance Report
10. Property, plant and equipment
Company
Land and
Buildings
£’000
Plant and
Equipment
£’000
Total
£’000
Cost
At 1 July 2022
2,574
682
3,256
Additions
-
131
131
Disposals
-
At 30 June 2023
2,574
813
3,387
Depreciation
At 1 July 2022
1,171
433
1,604
Depreciation charge for the year
56
107
163
Disposals
-
-
-
At 30 June 2023
1,227
540
1,767
Net book value at 30 June 2023
1,347
273
1,620
Cost
At 1 July 2023
2,574
813
3,387
Additions
13
153
166
Disposals
-
(50)
(50)
At 30 June 2024
2,587
916
3,503
Depreciation
At 1 July 2023
1,227
540
1,767
Depreciation charge for the year
21
129
150
Disposals
-
-
-
At 30 June 2024
1,248
669
1,917
Net book value at 30 June 2024
1,339
247
1,586
Notes to the Financial Statements continued
52
Northamber Report and Accounts 2024
11. Intangible assets
Group
Goodwill
£’000
Software
£’000
Brands
£’000
Customer
Relationships
£’000
Total
£’000
Cost
At 30 June 2021, 30 June 2022 and
30 June 2023
1,025
63
333
1,421
Additions
589
395
120
1,706
2,810
At 30 June 2024
1,614
395
183
2,039
4,231
Amortisation and impairment
At 1 July 2022
-
(18)
(95)
(113)
Amortisation during the year
-
(9)
(48)
(57)
At 30 June 2023
-
-
(27)
(143)
(170)
Amortisation and impairment
At 1 July 2023
-
-
(27)
(143)
(170)
Amortisation during the year
-
(71)
(9)
(48)
(128)
At 30 June 2024
-
(71)
(36)
(191)
(298)
Carrying Amount
At 30 June 2024
1,614
324
147
1,848
3,933
At 30 June 2023
1,025
-
36
190
1,251
The Group tests goodwill annually for impairment or more frequently if there are indications that goodwill might be impaired.
Amortisation is included under administration costs in the Statement of Comprehensive Income.
The remaining amortisation period for Audio Visual Material Ltd is 3 years, and the remaining amortisation period for Tempura
Communications Group is 7 years.
The recoverable amount of the CGU is based on a value in use calculation using cash flow projections over a 5-year period,
including the latest one year forecast approved by the Board. The one year forecast is prepared considering expectations based
on market knowledge, and financial performance since the date of acquisition. The remaining years are based on anticipated
sales over an economic cycle, together with historical financial performance. A terminal value using a 5-times EBITDA multiple is
used as the basis for the final year.
Key assumptions used in value in use calculation
The key assumptions for the value in use calculation are those regarding:
• pre-tax discount rate;
• revenue;
• gross profit margins; and
• operating profit margins.
Notes to the Financial Statements continued
Northamber Report and Accounts 2024
53
Strategic Report
Financial Statements
Governance Report
Audio visual material limited
Pre-tax discount rate
The Group’s post-tax weighted average cost of capital has
been used to calculate a Group pre-tax discount rate of
22.5%, which reflects current market assessments of the time
value of money for the period under review and the risks
specific to the Group.
Revenue
Revenue assumptions in the one year forecast are derived
from expectations based on market knowledge, and the
financial performance since the date of acquisition. Future
year revenue levels are based on anticipated opportunities
over an economic cycle. The average number of
opportunities over the period is in line with historical levels.
Gross profit margins
The gross profit growth rate used in Year 1 is 10% (2023: 15.1%)
and thereafter the average annual gross margin growth rates
are 7.1% reducing to 4.5% (2023: 9.6%).
Gross profit margin percentages over the extrapolation
period are 16% (2023: 15.15%), which is based on historical
financial performance and expectations of future market
developments.
Operating profit margins
Operating profit margins in the one year forecast are derived
from the expected gross margin and the overhead cost base.
Operating profit margins average 6% (2023: 5.1%) over the
period.
Sensitivity to changes in assumptions
There is headroom in the value in use calculation compared
to the carrying value of the CGU. Audio Visual Material
Limited has a recoverable amount of £3.36 million (2023:
£2.54 million) exceeds its carrying amount by £1.23 million
(2023: £0.44 million).
If any one of the following changes were made to the above
key assumptions, the carrying amount and recoverable
amount would be equal.
• Discount rate increase from 23 % to 40%
• Gross margin falls to 14 % each year on the above revenue
growth rates
Tempura communications limited
(group)
Pre-tax discount rate
The Group’s post-tax weighted average cost of capital has
been used to calculate a Group pre-tax discount rate of
29.5%, which reflects current market assessments of the time
value of money for the period under review and the risks
specific to the Group.
Revenue
Revenue assumptions in the one year forecast are derived
from expectations based on market knowledge, and the
financial performance since the date of acquisition. Future
year revenue levels are based on anticipated opportunities
over an economic cycle. The average number of
opportunities over the period is in line with historical levels.
Gross profit margins
The gross profit growth rate used in Year 1 is 10% and
thereafter the average annual gross margin growth rates
are 10%.
Gross profit margin percentages over the extrapolation period
are 19% which is based on historical financial performance
and expectations of future market developments.
Notes to the Financial Statements continued
54
Northamber Report and Accounts 2024
Operating profit margins
Operating profit margins in the one year forecast are derived from the expected gross margin and the overhead cost base.
Operating profit margins average 9.7% over the period.
Company
Software
£’000
Total
£’000
Cost
At 30 June 2021, 30 June 2022 and 30 June 2023
Additions
395
395
At 30 June 2024
395
395
Amortisation and impairment
At 1 July 2022
Amortisation during the year
At 30 June 2023
-
-
Amortisation and impairment
At 1 July 2023
Amortisation during the year
(71)
(71)
At 30 June 2024
(71)
(71)
Carrying Amount
At 30 June 2024
324
324
At 30 June 2023
-
-
12. Inventories
Group
Company
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Goods for resale
11,838
11,447
8,014
10,456
Cost of sales include £47,969,000 (2023: £58,243,000) inventory expensed in the year’s statement of comprehensive income.
An impairment charge of nil is recognised in cost of sales (2023: Nil). A provision against slow moving stock has been included
amounting to £646,000 (2023: £330,000).
13. Trade and other receivables
Group
Company
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Trade receivables
10,182
10,567
7,394
10,212
Less provision for impairment of
receivables
(162)
(119)
(119)
(101)
Net trade receivables
10,020
10,448
7,275
10,111
Intercompany receivables
-
-
-
315
Prepayments and other receivables
2,087
1,651
2,222
1,426
12,107
12,099
9,497
11,852
Notes to the Financial Statements continued
Northamber Report and Accounts 2024
55
Strategic Report
Financial Statements
Governance Report
The Directors do not consider the fair value of trade and other receivables to be significantly different from their carrying values.
The Directors have used historical experience of collecting receivables, supported by the level of default (non-payment from
customer), together with forward looking information to determine that credit risk is very low.
The Group applies the IFRS 9 simplified approach to measuring expected credit losses using a lifetime expected credit loss
provision for trade receivables. To measure expected credit losses on a collective basis, trade receivables are assessed based
on similar credit risk and ageing. The expected loss rates are based on the Group’s historical credit losses experienced over the
three year period prior to the year end. The historical loss rates are then adjusted for current and forward-looking information
on macroeconomic factors affecting the Group’s customers. Credit insurance forms a key part of the credit risk management
strategy.
Trade receivables that are more than three months past due are reviewed for impairment on an individual basis including
consideration of previous payment history and the ongoing relationship with the customer.
Trade receivables older than credit terms
Ageing of past due receivables are as follows:
Group
Company
2024
£’000
2023
£’000
2024
£’000
2023
£’000
0 - 30 days past due
2,429
850
2,003
674
30 - 60 days past due
664
125
402
102
60 - 90 days past due
279
95
176
21
90 + days past due
695
275
320
169
Trade and other receivables impairment provision
Group
Company
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Balance at beginning of period
119
330
101
312
Amounts written off as uncollectable
(7)
(321)
(6)
(321)
Increase in impairment loss provision
43
110
24
110
162
119
119
101
At 30 June 2024 the Group’s total lifetime credit loss provision was £162,000, of which trade receivables of £50,000 had lifetime
expected credit losses of the full value of the receivables.
At 30 June 2024 the Company’s total lifetime credit loss provision was £119,000, of which trade receivables of £32,000 had lifetime
expected credit losses of the full value of the receivables.
The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable mentioned above.
The Group does not hold any collateral as security.
Credit risk is deemed a risk due to default in payment. The Group’s exposure to credit risk is influenced mainly by the individual
characteristics of each customer. However, management also considers the factors that may influence the credit risk of its
customer base, including the default risk associated with the industry. Receivables are written off where it is considered there is
no chance of recoverability generally due to the cessation of trade of a customer.
The Group has established a credit policy under which each new customer is analysed individually for creditworthiness before
the Group’s standard payment and delivery terms and conditions are offered. The Group’s review includes external ratings,
if they are available, financial statements, credit agency information, credit insurers recommendations and industry information.
Notes to the Financial Statements continued
56
Northamber Report and Accounts 2024
Sale limits are established for each customer and reviewed regularly. Any sales exceeding those limits require approval.
The Group limits its exposure to credit risk from trade receivables by establishing a maximum payment period of one and
three months.
The Group uses credit insurance to mitigate against any potential risk of non-payment.
14. Cash and cash equivalents
Group
Company
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Bank balances and cash in hand
4,687
5,512
3,559
5,240
Cash and cash equivalents in statement
of cash flows
4,687
5,512
3,559
5,240
15. Trade and other payables
Group
Company
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Trade payables
8,540
9,966
6,325
9,218
Intercompany payables
-
-
9,242
9,030
Other payables
5,618
60
4,525
51
VAT
488
1,093
188
1,086
Other tax and social security
157
165
123
148
Accruals and deferred income
656
667
590
604
15,459
11,951
20,993
20,137
Included within other payables is £2,820,000 invoice discounting (2023: £nil). The financial liabilities shown above are those which
were outstanding at 30 June 2024. The average credit period taken for trade payables is 65 days (2023: 52 days).
The Directors consider that the fair values of trade and other payables are not materially different from those disclosed above.
Trade payables are not interest bearing.
The liquidity in trade and other payables is managed by the company through the management of its cash resources as
referred to in the Strategic Report, to ensure that for all practical purposes’ creditors are paid in accordance with the credit
terms agreed with the suppliers.
16. Share capital
Number
£’000
Authorised shares of 1p each At 30 June 2024 and 2023
80,000,000
2,000
Issued and fully paid shares of 1p each At 30 June 2024
27,413,404
274
At 30 June 2023
27,231,586
272
The company has one class of ordinary shares which carry no right to fixed income.
Notes to the Financial Statements continued
Northamber Report and Accounts 2024
57
Strategic Report
Financial Statements
Governance Report
17. Investment in Group companies
Company
2024
£’000
2023
£’000
Cost and net book value
7,211
2,135
An impairment review has been undertaken at the end of the financial year as required under IAS36: Impairment of assets.
See note 11 for the assumptions and sensitivity analysis.
In the opinion of the Directors, the value of the company’s investments is not less than the amount included in the company
statement of financial position.
Name
Country of
Incorporation
% owned
Status
Anitass Limited
England
100
Operational
Audio Visual Material Limited
England
100
Operational
Tempura Communications Limited
England
100
Operational
Solution Point Limited
England
99
Dormant
Tempura Technology Limited
England
100
Operational
Tempura Connect Limited
England
100
Operational
Tempura Ireland Limited
Ireland
100
Operational
Tempura Netherlands (BV)
Netherlands
100
Operational
Solution Technology Limited
England
100
Dormant
Thripple-Thrift Limited
England
100
Dormant
The registered office of all of these companies is detailed on page 27.
18. Capital commitments
At 30 June 2024, the company had capital commitments, contracted for but not provided in these financial statements of £nil
(2023: £278,000).
19. Related party transactions and ultimate controlling party
Mr A.M. Phillips is the ultimate controlling party of the company due to his majority shareholding in the issued share capital of the
Company.
During the year, the company paid £300,000 (2023: £300,000) rent to Anitass Limited, a wholly owned subsidiary. At the year-end
Northamber plc owed Anitass Limited £9,242,000 (2023: £9,030,000).
During the year, the company received £46,500 (2023: £46,500) rent and £66,000 (2023: £66,000) management charge from
Audio Visual Material Limited “AVM”, a wholly owned subsidiary.
During the year AVM purchased £496,000(2023: £537,000) worth of goods from Northamber Plc and Northamber Plc purchased
£133,000(2023: £589,000) worth of goods from AVM. AVM owed £342,000 (2023: £315,000) to Northamber Plc at the year end.
During the year Tempura purchased £54,000 worth of goods from Northamber Plc and Northamber Plc purchased £28,000 worth
of goods from Tempura. Tempura owed £342,000 to Northamber Plc at the year end.
All intercompany balances are interest free and unsecured.
Notes to the Financial Statements continued
58
Northamber Report and Accounts 2024
20. Share option scheme
On 27 July 2023, the company adopted a Company Share Option Plan (CSOP), under which all of the company’s eligible
employees will be able to participate. Options under the CSOP (CSOP Options) to acquire a total of 131,250 ordinary shares of
£0.01 each in the capital of the company (Ordinary Shares), have been granted to three directors, which represent 0.48 per cent.
of the existing issued share capital of the company.
In addition, the company subsequently granted additional CSOP Options to acquire 1,124,993 Ordinary Shares to senior
management and other employees, which represents 4.13 per cent of the existing issued share capital of the company.
Share Options
Number
Outstanding at 1 July 23
0
Granted during period
1,047,408
Forfeited during period
(261,250)
Expired during period
0
Outstanding at 30 June 24
786,158
The weighted average exercise price of share options at the end of the period was 42.7p. The weighted average remaining
contractual life was 2 years and 1 month from 30 June 2024.
The calculated fair value of equity instruments granted is £37,140. This has not been included in the financial statements.
21. Events after the reporting date
On 1st July 2024 the company acquired 100% of the share capital of Renaissance Contingency Services Ltd a company registered
in the Republic of Ireland, for the cash value of £507,000.
22. Financial instruments exposure
Trade and other receivables, cash and cash equivalents, and trade and other payables are measured at amortised cost.
The accounting policies applied are set out in note 2. The carrying amounts of financial assets and liabilities as at 30 June 2024
are categorised below.
The interest rate exposure of the financial assets and liabilities of the Group and company as at 30 June 2024 is shown in the
table below. The table includes trade receivables and payables as these do not attract interest and are therefore subject to fair
value interest rate risk.
Based on exposure at the reporting date, currency movements are not considered likely to have a material effect on profits or equity.
Note 15 above refers to further matters relating to credit risk as does the Strategic Report under the heading of Financial Risk.
Floating
£’000
Zero
£’000
Total
£’000
Group – Year ended 30 June 2024
Financial assets at amortised cost Cash and cash equivalents:
Sterling
1,242
-
1,242
US Dollars (Sterling equivalent)
95
-
95
Euros (Sterling equivalent)
530
-
530
Trade and other receivables
-
10,020
10,020
Total
1,867
10,020
11,887
Notes to the Financial Statements continued
Northamber Report and Accounts 2024
59
Strategic Report
Financial Statements
Governance Report
Floating
£’000
Zero
£’000
Total
£’000
Financial liabilities at amortised cost Trade payables:
Sterling
-
5,519
5,519
US Dollars (Sterling equivalent)
-
1,591
1,591
Euros (Sterling equivalent)
-
1,431
1,431
Other payables
-
2,657
2,657
Total
-
11,198
11,198
Floating
£’000
Zero
£’000
Total
£’000
Group – Year ended 30 June 2023
Financial assets at amortised cost Cash and cash equivalents:
Sterling
4,951
-
4,951
US Dollars (Sterling equivalent)
290
-
290
Euros (Sterling equivalent)
271
-
271
Trade and other receivables
-
10,448
10,448
Total
5,512
10,448
15,960
Floating
£’000
Zero
£’000
Total
£’000
Financial liabilities at amortised cost Trade payables:
Sterling
-
7,641
7,641
US Dollars (Sterling equivalent)
-
1,992
1,992
Euros (Sterling equivalent)
-
333
333
Other payables
-
60
60
Total
-
10,026
10,026
Floating
£’000
Zero
£’000
Total
£’000
Company – Year ended 30 June 2024
Financial assets - at amortised cost Cash and cash equivalents:
Sterling
119
-
119
US Dollars (Sterling equivalent)
95
-
95
Euros (Sterling equivalent)
525
-
525
Trade and other receivables
-
7,275
7,275
Total
739
7,275
8,014
Floating
£’000
Zero
£’000
Total
£’000
Financial liabilities at amortised cost Trade payables:
Sterling
-
7,326
7,326
US Dollars (Sterling equivalent)
-
12
12
Euros (Sterling equivalent)
-
56
56
Inter Company payables
-
9,242
9,242
Other payables
-
2,674
2,674
Total
-
19,310
19,310
Notes to the Financial Statements continued
60
Northamber Report and Accounts 2024
The Directors estimate that an increase or decrease in annual average interest rates of 0.5% would increase/decrease profit
before tax by approximately £6,000 (2023: £26,000).
Floating
£’000
Zero
£’000
Total
£’000
Company – Year ended 30 June 2023
Financial assets - at amortised cost Cash and cash equivalents:
Sterling
4,679
-
4,679
US Dollars (Sterling equivalent)
290
-
290
Euros (Sterling equivalent)
271
-
271
Trade and other receivables
-
10,111
10,111
Total
5,240
10,111
15,351
Floating
£’000
Zero
£’000
Total
£’000
Financial liabilities at amortised cost Trade payables:
Sterling
-
6,893
6,893
US Dollars (Sterling equivalent)
-
1,992
1,992
Euros (Sterling equivalent)
-
333
333
Inter Company payables
-
9,030
9,030
Other payables
-
51
51
Total
-
18,299
18,299
Maturity of Financial Instruments
All financial liabilities are classified as current and are due within 60 days.
There is no material difference between the fair value and book value of financial instruments.
23. Acquisitions
On 29 April 2024, the Group acquired 100% of the issued share capital of Tempura Communications Limited and Tempura
Technology Limited (“Tempura”). Tempura is a specialist distributor of UC7C and audio visual hardware and services. Tempura
was acquired to extend the Group’s offering into the audio visual market and accelerates the Group’s evolution towards higher
Gross margins.
The acquisition develops a new customer base for the Group, complements the existing customer base and provides the Group
with additional market share in the significant audio visual market sector.
Notes to the Financial Statements continued
Northamber Report and Accounts 2024
61
Strategic Report
Financial Statements
Governance Report
The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are set out below:
Book value
£’000
Fair value
adjustments
£’000
Fair value
£’000
Net assets acquired
Intangible Asset – Brand
-
120
120
Intangible Asset – Customers relationships
-
1,706
1,706
Deferred tax liability
-
(456)
(456)
Property, plant and equipment
456
456
Stock of finished goods
2,979
-
2,979
Trade and other receivables
2,200
-
2,200
Cash
447
447
Trade and other payables
(2,964)
-
(2,964)
Total identifiable assets
3,118
1,370
4,488
Satisfied by:
Consideration under IFRS 3
Cash consideration
3,312
Share issue
100
Deferred consideration
1,665
Goodwill
589
Cash outflows arising on acquisition
Cash consideration
3,312
Acquisition costs of £265,000 have been charged to the statement of comprehensive income as a transaction cost.
The share issue was by virtue of the issue of 181,818 Ordinary Shares (the “Consideration Shares”) at an issue price of 55 pence
per Consideration Share. The Consideration Shares are subject to a 36 month lock in period during which the Consideration
Shares cannot be sold or transferred other than in respect of typical carve outs.
£2,635,000 is the maximum deferred consideration that will be paid. The deferred consideration above is calculated using a
discount rate of 29.5% as per the Purchase Price Allocation calculation.
Stock of finished goods is stated after a provision of £275,000 and Trade Debtors are stated after a provision of £25,000.
The acquisition contributed £733,000 of revenue and £226,000 to the group’s operating loss (before amortisation and transaction
costs) for the period between the date of acquisition and the balance sheet date.
The acquisition would have contributed £12,304,000 of revenue and £289,000 of profit for the full year.
Notes to the Financial Statements continued
62
Northamber Report and Accounts 2024
23 DAVIS ROAD
CHESSINGTON, SURREY,
KT9 1HS
NORTHAMBER.COM