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W W W . P L E X U S P L C . C O M
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P O S - G R IP ®
P O S - G R I P ®
P O S-G R IP ®
P ROPRIETARY METHOD O F
P ROPRIETARY M ETHO D OF
PROPRIETARY METHOD OF
FRICTION GRIP ENGINEERING
F RICTION GRIP EN GIN EERING
F RICTION GRIP ENGINEERING
POS-GRIP friction-grip technology is based
on a very simple concept. A compressive
force is applied on the outside of a wellhead
or pipe, to flex it inwards. As the bore of
the vessel moves inwards, it makes contact
with an inner pipe (or hanger) on the inside.
Sufficient contact force is generated to fix
the inner member (hanger) in place through
friction between the two components.
In wellheads, POS-GRIP can replace the
conventional load shoulder or slips to
provide an improved hanger support
mechanism.
Utilising our patented POS-GRIP technology,
we are continually developing new wellhead
equipment to meet our customers’
requirements, delivering solutions for
the surface, subsea and decommissioning
markets.
Plexus HG® technology, is a simple scientific
POS-GRIP friction-grip technology is based
method of design for metal interface seals, used to
on a very simple concept. A compressive
permanently contain METHANE GAS in wellheads,
force is applied on the outside of a wellhead
throughout the life of a producing well.
or pipe, to flex it inwards. As the bore of
the vessel moves inwards, it makes contact
The seal system comprises of multiple integral
with an inner pipe (or hanger) on the inside.
radiused bump rings, which interact directly with
Sufficient contact force is generated to fix
the wellhead bore, to halve the number of leak paths
the inner member (hanger) in place through
past the annulus, using a series of redundant gallery
friction between the two components.
seals. A preload above yield is carefully delivered
and recorded by the externally controlled horizontal
In wellheads, POS-GRIP can replace the
deflection of the housing wall against solid hanger
conventional load shoulder or slips to
bodies, thereby equally distributing perimeter
provide an improved hanger support
stress, in compliance with the principles of Hertzian
mechanism.
Stress Theory (HST).
Production wellheads and surface subsea
have all benefitted from POS-GRIP. Casing and
tubing hangers can be gripped, but POS-GRIP
can also be used to support wearbushings,
BOP test tools and seal sleeves.
Outlet valve equipment to be
supplied through PPC
POS-GRIP APPLICATIONS
Connectors
Wellheads
POS-GRIP is ideal for high integrity, low
fatigue connector applications. Wellhead
connectors, riser connectors, subsea jumper
connectors, pipeline connectors, and even
vessel mooring connectors can benefit from
the simplicity of POS-GRIP.
Utilising our patented POS-GRIP technology,
The system stays permanently rigid, guarantees
we are continually developing new wellhead
life-cycle integrity and is maintenance-free, using
equipment to meet our customers’
re-usable components. By matching materials at the
requirements, delivering solutions for
seal interface, bi-metallic corrosion is prevented and
the surface, subsea and decommissioning
POS-GRIP “HG” Production Wellhead
multiple metal seals are used to anticipate the pace
with PPC valves and tree
markets.
of chemical degradation, throughout field-life.
Wellheads and connectors can both benefit
from the direct contact created when the
POS-GRIP metal to metal HG® seal is activated,
delivering an unrivalled gas-proof seal.
Metal-to-metal sealing
P L E X U S
P O S - G R I P T E C H N O L O G Y
POS-GRIP in OPEN Position
A potential low cost application of
POS-GRIP in CLOSED Position
POS-GRIP in an “HG” Tubing Head
P L E X U S
P O S - G R I P T E C H N O L O G Y
P L E X U S
P O S - G R I P T E C H N O L O G Y
POS-SET Connector recently deployed
POS-GRIP
for a well decommissioning project
Production Wellhead System
POS-GRIP
“HG” Production Wellhead installed offshore
POS-GRIP “HG” Production Wellhead recently intalled offshore
P OS-G RIP AP PL ICAT IO NS
P OS-G R IP APP LIC AT ION S
Wellheads
P L E X U S
P O S - G R I P T E C H N O L O G Y
Wellheads
Production wellheads and surface subsea
have all benefitted from POS-GRIP. Casing and
Production wellheads, both surface and subsea
tubing hangers can be gripped, but POS-GRIP
have all benefitted from POS-GRIP. Casing
can also be used to support wearbushings,
and tubing hangers can be gripped, but
BOP test tools and seal sleeves.
POS-GRIP can also be used to support
wearbushings, BOP test tools and seal
Connectors
sleeves.
Connectors
POS-GRIP is ideal for high integrity, low
fatigue connector applications. Wellhead
connectors, riser connectors, subsea jumper
POS-GRIP is ideal for high integrity, low
connectors, pipeline connectors, and even
fatigue connector applications. Wellhead
vessel mooring connectors can benefit from
connectors, riser connectors, subsea jumper
the simplicity of POS-GRIP.
connectors, pipeline connectors, and even
vessel mooring connectors can benefit from
the simplicity of POS-GRIP.
Metal-to-metal sealing
Metal-to-metal sealing
Wellheads and connectors can both benefit
from the direct contact created when the
POS-GRIP metal to metal HG® seal is activated,
Wellheads and connectors can both benefit
delivering an unrivalled gas-proof seal.
from the direct contact created when the
POS-GRIP metal to metal HG® seal is
activated.
Exact EX 18-3/4” 10k Adjustable Surface
Exploration Rental Wellhead System
POS-GRIP “HG” production wellhead is assembled ready for testing ahead of
drilling and producing a new North Sea well
P L E X U S
P O S - G R I P T E C H N O L O G Y
Financial and Operational Overview
Financial Summary
l
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Continuing operations sales revenue £2,306k (2021: £2,017k)
Adjusted EBITDA on continuing activities £2.78m loss (2021: £2.69m loss), (page 10).
Continuing operations operating loss £4,291k (2021: £4,546k)
Continuing operations loss before tax £5,556k (2021: £4,372)
Continuing operations operating loss after tax £7,457k (2021: £4,110k)
Basic loss per share from continuing activities 7.42p (2021: 4.09p loss)
Cash and cash equivalents of £5.84m (2021: £5.18m)
Bank borrowing of £3.96m (2021: £2.04m) relating to a drawn down Lombard facility
The Group has £0.1m invested in financial assets (2021: £3.04m)
Operational Overview
Revenue streams are derived from both direct sales and the licencing of the Plexus’ POS-GRIP method of
engineering technology to third parties, including Schlumberger. The goal is to establish the Company’s proprietary
and patented leak-proof wellhead systems and specialist engineering solutions across the oil and gas industry,
whilst helping to meet ESG and NetZero goals by offering ‘through the BOP’ (Blow out Preventer) designs, and
leak-proof seals capable of retaining their integrity for the life of well thereby avoiding costs associated with
maintenance and well shut ins.
l
June 2022 secured Oceaneering order for Plug & Abandonment (“P&A”) equipment and services estimated
to generate revenues of circa. £500,000
l March 2022 suspended activities with LLC Gusar (“Gusar”), its Russian licencee partner following the
outbreak of the war in Ukraine, with little or no impact on the Company’s finances during the period.
l
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December 2021 signed a contract with a leading North Sea Operator for a POSGRIP surface production
wellhead system
December 2021 expanded market reach via revised nonexclusive licence agreement terms with Cameron
International Corporation (“Cameron”), Schlumberger’s wellhead company enabling Cameron to:
o
o
Design, market and sell Plexus' POSGRIP and HG® metaltometal seal method of wellhead engineering
for surface production wellheads to its existing clients
Add additional territories to the agreement to make the licence worldwide and where higher royalty
rates will apply in the range of 3% to 6% of the revenues generated from the sale, lease, or rental of
surface wellheads
August 2021 reentered the Jackup Exploration Rental Wellhead market, through a collaboration agreement
with Cameron
July 2021 received the London Stock Exchange's Green Economy Mark awarded to companies and funds
where 50% or more of their revenues are attributable to environmental solutions which contribute to the
global green economy, in alignment with Net Zero and ESG principles
Post period end
l
October 2022 raised £1,550,000 through the issue of Convertible Loan Notes (“CLNs”), which will be used
for working capital and to fund the Group’s activities as it seeks to capitalise on the increasing pipeline of
opportunities within its target markets.
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Plexus Holdings plc Annual Report 2022
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Chief Executive Ben Van Bilderbeek said:
“During the year to 30th June 2022, the Group made a loss before tax on continuing operations of £5.56m compared
to a loss in the prior year of £4.37m. The board is focussing reversing this performance and several pivotal decisions
have been taken. Perhaps the most significant being the Company’s reentry into the drilling from Jackup rigs
exploration rental wellhead business. This is the sector in which Plexus initially built its name and reputation,
before we elected to exit this market in 2018 following the collapse of the oil price in 2014 and 2015. During that
time, capital investment in exploration activity dwindled away and, six years on, the oil and gas market has changed
once again.
During the pandemic we saw a major shift in geopolitics and industry sentiment led initially by a boom in renewable
energy. Followed by Russia’s war against Ukraine which has subsequently led to the recognition of the need to
increase and deliver energy security closer to home. This has flagged the importance of the oil and gas industry
investing in exploration and production activities as, without this, as suggested by Saudi Arabia, the world could
be short of approximately 30 million barrels of oil a day in eight years’ time, while currently the world consumes
circa 100 million barrels per day.
This change of industry circumstances is beginning to have a positive effect as evidenced by the significant increases
in profits of the oil and gas operators, and it is anticipated that the oil services companies will similarly benefit.
As reported by Rystad Energy, global oil and gas investments will rise 4% to US$628 billion this year from
US$602 billion in 2021, while Schlumberger’s CEO recently said that it is “one of the strongest outlooks for the
energy services industry in recent times”, and Baker Hughes head said there are “very busy years ahead” in an
“accelerating multiyear upcycle”. In the same vein, Shell suggested it will cost billions of dollars just to keep
production flat as production from existing wells declining at circa 15% to 20% a year; this requires investment
tied to older wells as well as having to discover and develop new wells to replenish portfolios.
However, it is not all plain sailing for the industry as investors, governments, and regulators are no longer tolerating
the oil and gas industry’s previously accepted practices as far as emission levels are concerned, which are now
recognised as being too high and unsustainable. Pressure continues to build with operators required to operate more
sustainably with the aim of achieving a 45% reduction in emissions by 2030 and NetZero targets by 2050. While in
the past, many oil companies have focused on using/fixing old solutions and infrastructure, their hands are now being
forced to invest in and utilise new technology that can help to prevent rather than cure emissions. I believe that as a
result, companies like Plexus, which can offer leak proof wellheads with long term integrity for the life of a well, are
well positioned to benefit from these major green initiatives, whilst also helping to significantly reduce the amount of
methane gas being released into the atmosphere as a result of fugitive emissions, the polite name for leaks.
A major step forward in the journey towards a greener and more responsible oil and gas industry was the introduction
of the Inflation Reduction Act (‘IRA’) in August this year by US President Biden. This is a US$369bn package of
investment designed to tackle the climate crisis, which holds major oil and gas companies in the US to account for
their operations and the amount of methane gas leaked into the atmosphere. Estimates suggest that it could cut
US greenhouse gas emissions by 40% by 2030. Aside from penalising the worst polluters, the fund has set aside
US$1.5bn in subsidies to help the companies affected invest in the technology to fix the leaks, as well as providing
tax breaks for those that invest in green energy solutions. It is hoped that, as suggested by Jonathan Banks at the
Clean Air Task Force, a similar fee “could be repeated elsewhere in the world”.
I believe that Plexus can make a meaningful contribution to such emission reduction demands, particularly in
relation to supplying the industry with its HG® metaltometal wellhead seals which can deliver leak proof
performance for surface and subsea production wellheads, and specialist POSGRIP applications such as P&A.
We gained a boost in recognition of our green technology credentials in July 2021 when Plexus was recognised by
the London Stock Exchange as contributing to the green economy by deriving more than 50% of revenues from
environmental solutions with the Green Economy Mark accreditation.
Encouragingly, we are experiencing an increased level of interest in our ExactEX ‘through the BOP’ exploration
wellhead rental services, Centric15 mudline hangers and our POSGRIP “HG” surface production wellhead
technology, for which we are positioning the Company to benefit, by way of planned investment in additional rental
inventory and increased customer, industry partner and licencee engagement.
For example, in December 2021, we signed a purchase order for a POSGRIP surface production wellhead system for
a leading North Sea operator, and we are pursuing a number of other additional prospects. This is in line with our
IPled strategy to gain surface production wellheads market share in conjunction with a licence cooperation agreement
signed with Cameron, a Schlumberger Group company, the scope of which was expanded in midDecember 2021.
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Plexus Holdings plc Annual Report 2022
Our research and development (“R&D”) team continues to work hard to ensure that our innovative patented
POSGRIP technology is fully utilised and deployed across various applications. For example, the highgrowth,
multibillion P&A market, which focuses on preparing a well to be closed permanently at the end of its life, is such
an opportunity. Towards the end of the period in June 2022, we were delighted to announce a Purchase Order for
P&A equipment and services from Oceaneering International Services Limited (“Oceaneering”), a division of
Oceaneering International Inc., a leading subsea engineering and applied technology company, to support its
vesselbased P&A services for a sixoperator joint campaign in the Dutch Sector of the North Sea. Given the size
and rapid growth prospects for the P&A market, we hope this project will lead to other similar work in the North
Sea and internationally both with Oceaneering and other customers.
Another pressing topic we believe that we can help address is the mitigation of problems related to subsea wellheads
such as Sustained Casing Pressure (“SCP”), which is a major threat to subsea wellhead integrity and for which no
means of remediation currently exists. Since 2015, following an industry Joint Industry Project, Plexus has
considered a unique subsea annulus management solution, as part of our patented Python® subsea wellhead system,
without needing penetrations through the wellhead body in line with API standards. As subsea wellheads are difficult
and expensive to access and maintain, and in some cases are not able to have remedial work carried out at all, the
new regulations and demands bring into sharp focus the argument that Plexus has always promoted which is that
prevention is better than supposed cures.
As the oil and gas industry transitions to being more responsible and innovative, an area that is developing fast,
where I believe Plexus can also play a part is gas storage, whether natural gas, CO2, or indeed hydrogen.
Such longterm gas storage applications demand equipment and infrastructure that can last for periods well beyond
that expected of conventional oil and gas equipment. Wellheads are still required, but for injection rather than
extraction purposes, and being able to supply leak proof wellheads, where our unique seal design can address
corrosive conditions, such as exists with CO2 delivers unique benefits. With one of the largest potential carbon
dioxide storage capacities in Europe, the North Sea, the UK Government is committed to supporting the deployment
of largescale carbon capture, usage, and storage facilities. Accordingly, in June, the North Sea Transition Authority
(“NSTA”) launched the UK’s first carbon storage licensing round, inviting applications for 13 areas across the United
Kingdom Continental Shelf (“UKCS”), which, alongside the six licences issued previously, could have the ability
to store circa 2030 million tonnes of CO2 by 2030. We are assessing how Plexus could play a part in this unfolding
opportunity.
To help ensure Plexus continues to have sufficient working capital to expedite our growth plans, post period end,
in October 2022, we raised £1,550,000 through the issue of Convertible Loan Notes (“CLNs”). My fellow board
member, Jeffrey Thrall, and my family interests took part in this raise, demonstrating our belief in the contributions
Plexus can once again make to the oil and gas industry in reaching NetZero targets, and confidence that its
increasingly diversified product and services mix will deliver value to shareholders. The funds raised will be used
to support day to day activities including reentering the Jackup Exploration (Adjustable) Rental Wellhead market,
and our ongoing R&D programme.
In summary, I am optimistic that as momentum grows for greater efficiency and environmentally responsible
extraction of fossil fuels, oil and gas companies will look to innovative engineering companies like Plexus to support
their growth trajectory with the provision of safer, more reliable, and sustainable solutions. Furthermore, those
companies in related industries such as gas storage and carbon capture can also benefit from using our technology.
I look forward to reporting on progress during the 2022 /2023 financial year.”
Summary of Results for the year ended 30 June 2022
2022 2021
£’000 £’000
Revenue (continuing operations) 2,306 2,017
Adjusted EBITDA (page 10) (continuing operations) (2,780) (2,692)
Operating Loss (continuing operations) (4,291) (4,546)
Loss before taxation (continuing operations) (5,556) (4,372)
Loss after taxation (continuing operations) (7,457) (4,110)
Loss after taxation (discontinued operation) – (392)
Loss after taxation (combined) (7,457) (4,502)
Basic loss per share (pence) (continuing operations) (7.42p) (4.09p)
Basic (loss) / earning per share (pence) (discontinued operation) – (0.39p)
Plexus Holdings plc Annual Report 2022
4
Contents
Chairman’s Statement
Strategic Report
6
9
– Principal Activity 9
– Financial Results 9
– Operations 12
– Strategy and Future Developments 12
– Key Performance Indicators 14
– Principal Risks and Risk Management 14
– Section 172 Statement 17
Board of Directors
Directors’ Report
Corporate Governance
Audit Committee Report
Remuneration Committee Report
Statement of Directors’ Responsibilities
Independent Auditor’s Report to the Shareholders of Plexus Holdings plc
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Parent Company Statement of Financial Position
Parent Company Statement of Changes in Equity
Parent Company Statement of Cash Flows
Notes to the Parent Company Financial Statements
Corporate Information
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20
23
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51
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Plexus Holdings plc Annual Report 2022
Chairman’s Statement
Business progress
The Group’s revenues increased in the 12 months to 30 June 2022 to £2,306k (2021: £2,017k), with a loss on
continuing operations before tax of £5.56m compared to loss in the prior year of £4.37m in the prior year.
Encouragingly, the global outlook for growth in oil and gas development in the coming years is, as a result of the
war in Ukraine and the consequent increase in global energy prices, becoming more stable and positive after a
period of extreme volatility. In the North Sea, and internationally, there is a continued pickup in activity for
exploration and appraisal, production drilling and P&A work. As is usual in the cyclical oil and gas business,
operators’ initial priority in the up cycle is to increase production from existing wells and assets, and then turn to
pursuing new exploration work and field developments.
The August 2021 cooperation agreement with Cameron has enabled Plexus to reenter the Jackup exploration rental
wellhead market with the proven Exact and Centric wellhead and mudline suspension products. With the significant
increase in the planning of new exploration wells, and an established reputation in the exploration drilling market,
Plexus is well positioned to benefit from this growth in activity. During the period, Plexus has manufactured and
tested several sets of this equipment in response to enquiries and an anticipated growth in demand from customers.
This year saw a major order from Oceaneering for decommissioning work with innovative Plexus products. The
initial project scope will take place during the first half of 2023 where the equipment will be deployed on several
wells in the Dutch sector of the North Sea. Importantly, this contract has the potential for followon work both with
Oceaneering and with other contractors and operators with similar requirements.
As Plexus continues to be known as experts in Jackup exploration drilling and mudline suspension systems and has
knowledge of many of the legacy wells in the North Sea and worldwide which are now being considered for reentry
and permanent decommissioning, there is plenty of scope for gaining contracts in this growing space. Plexus has
also been active in general product engineering and support for several specialised projects, such as P&A.
The Company’s investment in associate company Kincardine Manufacturing Services Limited (“KMS”) has, like
many other similar companies in the sector, suffered a downturn in business over the past two years, primarily
driven by the effects of the COVID19 pandemic. KMS has managed to navigate through these turbulent times
with reasonable success by careful management of costs and utilisation of available Government support, such as
the furlough scheme. In the period, earnings have been lower than previous years and KMS has not been in a
position to pay dividends. Accordingly, an impairment charge of £109k has been taken by the Company after an
Impairment Review as required under IAS36. Management is confident that KMS is well positioned to recover as
activity levels continue to pick up in the second half of 2022 and into 2023.
Plexus’ primary core strength is its intellectual property (“IP”), together with its broad family of products and associated
equipment, which feature and incorporate this IP. The IP consists of a mix of patents, confidential test results and
analysis methods, as well as field experience and extensive product knowhow, and has in the year been recognised
by the LSE for its emissions reducing features with the accreditation of the Green Economy Mark. This all combines
to continue to give Plexus a robust and longterm level of protection, which is evidenced by ongoing licensing with
industry majors TechnipFMC and Schlumberger. Although product patents expire over time, the additional IP
surrounding the technology continues to protect all Plexus and licenced products. In addition to this, new Method
Patents for POSGRIP are expected to be published in the coming months, which are anticipated to give Plexus and
its licensees further general protection of the POSGRIP method for another 20 years in the UK and worldwide.
Overview
Plexus is a wellhead engineering and engineering technology led business. While the industry norm is often for
companies to try to win business with products which just meet the lowest acceptable technical requirement at the
lowest price, Plexus has always pushed for ways to significantly enhance safety and performance of the products
offered to result in a significantly improved value proposition for the end user, especially when considered over
the life of a well. These proprietary products are invariably protected by Plexus IP, such as POSGRIP technology
and “HG” metaltometal seals. The Company has demonstrated that its products and technology perform and can
be profitable over a wide range of products and applications and has also licenced its technology to industry majors,
whilst at the same time delivering green ESG and NetZero compliant features in relation to being “through the
BOP” and most importantly offering leakproof sealing throughout the life of a well thereby avoiding periodic and
often unsuccessful seal maintenance.
Plexus Holdings plc Annual Report 2022
6
Chairman’s Statement continued
As well as supporting licensees to begin to deploy the Plexus technology on a worldwide basis in markets that
Plexus is best placed to reach through its licencee partners, the Company continues to pursue surface and subsea
wellhead opportunities directly. In addition to this, Plexus is also actively pursuing opportunities in the Jackup
exploration wellhead business through a second licensing deal with Cameron which enables Plexus to offer Exact
exploration wellhead and Centric mudline suspension systems once again.
Staff
On behalf of the Board, I would once again like to thank all our employees for their dedication and hard work
during the year. Following the relaxation of COVID19 working restrictions we were pleased to welcome all staff
back to working in our Dyce, Aberdeen operational headquarters. Having weathered this difficult period, I am sure
that future developments and the anticipated increase in sales activity will be positive for our staff, and for future
employment opportunities within Plexus.
Outlook
The past year has highlighted the critical need for energy independence, and it is clear that the West is still beholden
to a variety of global macroeconomic factors, with some of these beyond its control. Whilst in an ideal world energy
independence would come solely from renewable energy, the world is still a long way from that being possible,
and at the same time population growth and energy demand continues to grow. In the meantime, with natural gas
being recognised and utilised as a cleaner transitional energy source, it is vitally important that it is extracted as
cleanly as possible.
The major importance of gas, and the unavoidable role that it has to play in the world’s energy future needs was
perhaps most clearly illustrated by statements made very recently to the Financial Times by Saad alKaabi the chief
executive of QatarEnergy. He argues that natural gas, which emits significant carbon when burnt but less than oil
and coal, should be central to the world’s energy transition, and said – “I agree with going green, but I always say
gas is not a transition fuel, it is a destination fuel. If you look at the base load of electricity in the world, it’s either
going to be gas, or nuclear for the ones that accept to have nuclear and can afford it. The rest is going to be some
fuel oils and a lot of renewables.”
The war in Ukraine and closure of the Nord Stream 1 gas pipeline highlighted the need for energy security in the
UK and Europe, leading to a demand for a resurgence in the exploration and development of oil and gas fields,
including in the North Sea. Governments across the globe have a precarious tightrope to walk – delivering on
promises to cut methane emissions in half by 2030 whilst safeguarding the reliable supply of energy to its
population. It is clear that currently hydrocarbons have a key role to play in energy provision and will do so for
many years to come.
We are confident that Plexus’ proprietary POSGRIP HG wellhead sealing technology, which offers leakfree
performance over the life of the well, can be utilised to simultaneously help operators secure energy independence
whilst helping achieve pledges on methane emissions reductions in line with ESG and NetZero strategies of
governments, regulators and organisations worldwide. This is key; as Durwood Zaelke, president of the Institute
for Governance & Sustainable Development pointed out when he said, “If you think of fossil fuel emissions as
putting the world on a slow boil, methane is a blow torch that is cooking us today.”
Accordingly, we are delighted with positive progress being made in this regard. Recently, the USA issued a
firstofitskind fee on methane leaks from the oil and gas sector, with the law imposing a charge of US$900 per
ton of fugitive methane emitted from oil and gas company wells. Whilst some of the oil and gas majors have pushed
back on this, others, including Shell, have supported this approach, which we hope will galvanise the industry into
eradicating leaks wherever possible whilst recognising that leaking wellheads would always be better addressed
through prevention rather than cure.
Another positive step towards reducing methane emissions is the creation of a Responsibly Sourced Gas (“RSG”)
stamp, which certifies and demonstrates to a buyer that the gas has been produced with minimal or even zero
methane leaks or other environmentally ‘responsible’ procurement practices. In time, I am hopeful that stamps like
these and other similar steps will become more commonplace to ensure that natural gas is the clean transitional
energy source that it has been earmarked to become.
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Plexus Holdings plc Annual Report 2022
Chairman’s Statement continued
With this fastchanging background and following the recent raising of £1,550,000 through the issue of convertible
loan notes which I supported alongside CEO Ben van Bilderbeek’s family interests, I am confident that our sales
team will convert the increasing number of enquiries and tenders into contracts, and that accordingly Plexus’ outlook
is a positive one.
J Jeffrey Thrall
Non-Executive Chairman
24 November 2022
Plexus Holdings plc Annual Report 2022
8
Strategic Report
Principal Activity
The Group markets oil and gas industry wellhead and associated equipment that utilises its patented friction grip
method of engineering known as POSGRIP Technology. This involves squeezing one tubular member against
another within the elastic range to effect gripping between the components and can also set metaltometal seals,
known as “HG”® Seal Technology. This superior method of load support and sealing for wellheads offers several
important and unique advantages to operators, particularly for HP/HT surface and subsea production applications,
and can include improved technical performance, improved integrity of metaltometal seals, significant installation
time savings, reduced operating and maintenance costs and enhanced safety.
The Company has developed a range of products based on this technology, and is focused on pursuing surface
production, abandonment, subsea and geothermal wellhead opportunities, as well as connectors and the subsea
market. It has also recently reentered the rental exploration wellhead from Jackup rigs market through a licence
arrangement with Schlumberger and it is hoped that this can be a main focus for Plexus to generate revenues from.
In addition to Plexus’ organic activities, the Company also pursues licencing opportunities, and is currently
supporting Cameron International Limited, a Schlumberger group company, to enable Cameron to use the
Company’s technology under a nonexclusive licence for the development of conventional and unconventional oil
and gas surface production wellheads. Cameron is in the process of testing, completing Performance Verification
Testing, and marketing two new POSGRIP products, which should lead to a royalty revenue stream for the
Company.
The Company retains the right to pursue Jackup exploration rental wellhead related business with POSGRIP
products in Russia and the CIS where it has existing licence agreements with LLC Gusar and CJSC Konar. However,
the licence agreement with Gusar is currently suspended due to the war in Ukraine and resulted in a bad debt
provision of £277k being recognised in the year.
Following the sale of the Company’s POSGRIP based rental wellhead exploration business to TFMC in 2018
revenues fell away as focus was turned to building up a new range of activities, namely production wellheads and
other specialist engineering opportunities, and longerterm subsea wellheads. This change of strategic direction
coincided with market challenges, and losses have had to be incurred over the past few years. However, having
reentered the rental wellhead sector, and having begun to make progress in the production wellhead sector it is
anticipated that this situation will begin to reverse in the 2023 calendar year.
Business review
A review of the development and performance during the year consistent with the size and complexity of the
business together with commentary on future developments including the main trends and factors likely to affect
the business is given in the Chairman’s Statement on page 6. Where guidelines make reference to the provision of
key performance indicators, the directors are of the opinion certain financial and nonfinancial indicators included
in the highlights on page 1, and the Directors’ Report on page 20 meet this requirement. The Directors have provided
a description of the principal risks and uncertainties facing the Group on page 14.
Financial Results
Statement of Comprehensive Income
Revenue
Continuing revenue for the year was £2,306k, an increase from £2,017k in the previous year. The increase in
continuing sales revenue is a result of increased operational project work taking place during the year.
Margin
Gross margin on continuing operations increased to 64.7% (compared to 47.3% in the previous year). The increase
in margin is largely driven by higher margins on sold equipment being achieved when compared to the prior year.
Additionally, cost of sales includes a stock provision charge of nil in the current year compared to £569k in the
prior year.
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Plexus Holdings plc Annual Report 2022
Strategic Report continued
Overhead expenses
Continuing activities administrative expenses have increased when compared to the prior year with expenditure of
£5.78m (2021: £5.50m). Included within administrative expenses is a bad debt provision of £277k, relating to a
licensing fee due from Gusar LLC which has been compromised by the suspension of activities due to the war in
Ukraine. Overhead expenses also include an impairment charge of £109k following a review of the carrying value
of the Group’s associate undertaking KMS.
Continuing salary and benefit costs remain the largest component of administrative expenses at £2.87m compared
to £2.79m in the prior year.
Non-recurring item
The statement of comprehensive income includes a fair value adjustment on an asset held for sale of £1.03m,
relating to the writedown in a building’s value to its fair value.
Adjusted EBITDA
The Directors use, amongst other things, Adjusted EBITDA on continuing operations as a nonGAAP measure to
assess the Group’s financial performance. The Directors consider Adjusted EBITDA on continuing operations,
which approximates the operational cash generated by, or used in the business, to be the most appropriate measure
of the underlying financial performance of the Group in the period.
Adjusted EBITDA on continuing operations for the year was a loss of £2.78m, compared to a loss of £2.69m in the
previous year. Adjusted EBITDA on continuing operations is calculated as follows:
Operating loss
Add back:
–Depreciation
–Amortisation
Share in profit / (loss) of associate
Fair value adjustment on financial assets
Impairment charge on associate undertaking
Other income
Adjusted EBITDA on continuing operations
2022 2021
£’000 £’000
(4,291) (4,546)
449 482
1,230 1,219
111 (77)
(513) 19
109 –
125 211
––––––– –––––––
(2,780) (2,692)
––––––– –––––––
Loss Before Tax
Loss before tax on continuing operations of £5.56m compared to a loss in the prior year of £4.37m. The loss on
discontinued operations is nil compared to a profit of £0.02m in the prior year.
Tax
The Group shows a total income tax credit of £0.04m for the year compared to a tax credit of £0.39m for the prior
year. The income tax credit wholly relates to continuing activities compared to the prior year split of £0.26m credit
on continuing activities and £0.41m charge on discontinued activities.
Investments
In December 2018, Plexus acquired a 49% shareholding in Kincardine Manufacturing Services Limited (“KMS”),
for a consideration of £735k plus associated legal fees of £50k. At the yearend a share in profit of associate of
£111k (2021: loss £77k) has been recognised. Following an impairment of the investment overhead expenses include
an impairment charge of £109k (2021: nil).
Plexus Holdings plc Annual Report 2022
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Strategic Report continued
EPS
The Group reports basic loss per share on continuing activities of 7.42p compared to a loss per share of 4.09p in
the prior year. The basic loss per share on discontinued activities of nil, compared to a loss per share of 0.39p in
the prior year.
Statement of Financial Position
Intangible Assets and Intellectual Property (“IP”)
The net book value of goodwill and intangible assets was £9.17m, a decrease of 4.9% from £9.64m last year.
This movement represents investment of £0.45m less the annual amortisation charge of £0.93m.
Plexus owns an extensive range of IP which includes many registered patents and trademarks across a number of
jurisdictions, and actively works to develop and protect new methods and applications where deemed commercially
advantageous to do so. In addition to registered IP, Plexus has developed over many years a vast body of specialist
knowhow in relation to the POSGRIP friction grip method of engineering and related activities.
The loss in the year and the market capitalisation of the company being less than the carrying value of the assets
are clear indicators of impairment. Following a thorough review, including a discounted cashflow model which
has included cashflows for 20 years. the Directors have concluded no impairment of IP is required. Therefore, the
Directors consider the current carrying values to be appropriate.
Research and Development (“R&D”)
R&D expenditure including patents increased from £0.24m in 2021 to £0.45m in 2022. Continued investment as
and where necessary in R&D demonstrates the Group is protecting, developing, and broadening the range of
proprietary POSGRIP frictiongrip method of engineering applications, related IP and Plexus products.
Tangible Assets
The net book value of property, plant and equipment including items at the yearend was £0.82m compared to
£2.96m last year. Current assets include a property held for sale with a carrying value of £1.1m. Capital expenditure
on tangible assets increased to £0.25m compared to £0.17m in the prior year.
Cash and Cash Equivalents
Net cash at the yearend was £1.88m (cash and cash equivalents of £5.84m less the bank Lombard facility of
£3.96m) compared to net cash of £3.14m in the prior year (cash and cash equivalents of £5.18m less the bank
Lombard facility of £2.04m) reflecting a net cash outflow for the year of £1.26m (net increase in cash of £0.66m
per Statement of Cash Flows plus net increase in bank borrowings of £1.92m).
The increase in bank borrowing represents £3.96m, which has been drawn down on a Lombard facility. This facility
was repaid in its entirety in July 2022.
It should also be noted that the Group has financial asset investments with a value of £0.10m (2021: £3.04m) at the
reporting date. These investments are included in noncurrent financial investments in the statement of financial
position.
The expected future cash inflows and the cash balances held are anticipated to be adequate to meet current ongoing
working capital, capital expenditure, R&D and project related commitments.
Dividends
The Company has not paid any dividends in the year and does not propose to pay a final dividend at this time.
Whilst the Company remains committed to distributing dividends to its shareholders when appropriate, the Directors
believe that it is prudent to suspend the payment of dividends in light of the ongoing capital and operational
requirements of the business.
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Strategic Report continued
Operations
Progress has continued during the year with the Company’s strategy to build a portfolio of revenue streams based
on its POSGRIP technology and associated products and services.
The Company’s primary focus continues to be the marketing of its POSGRIPenabled products and supporting
licensees of the technology, as well as the reentry to the rental exploration market with its nonPOSGRIP
equipment designs. Plexus continues to supply surface production wellheads and is also pursuing supplemental
business opportunities relating to well abandonment and decommissioning, which are anticipated to be growth
areas as the world’s older producing oil and gas fields, such as in the North Sea, come to the end of their lives.
Plexus continued to invest in R&D during the year, with significant focus on optimising the Exact rental exploration
wellhead product range for the current market, and also to complete product development and testing required for
the Oceaneering decommissioning work. R&D remains an important operational activity and further develops the
value of our IP and ability to extend the range of applications of POSGRIP technology. Innovation in the oil and
gas industry continues to be an essential part of developing both cost saving initiatives and ever safer drilling
methods, particularly in relation to greener leakproof technologies and equipment, and the Board is confident that
Plexus can continue to play an important role in delivering such solutions whilst raising wellhead standards to a
level that conventional technology cannot reach, such as passing test standards equivalent to those used for
premium couplings.
Staff at the end of June 2022 (excluding nonexecutive directors) comprised of 35 employees, including 1 international
employee, which compared to a weighted average total of 35 in the current year and 33 in the prior year.
Competency across the business has continued to evolve and broaden, with a system developed and implemented
within the existing appraisal process, to demonstrate the competency of officebased personnel. The Company
continues to maintain the OPITO accreditation for its competency management system, ensuring a robust assessment
of employees in safetycritical roles.
Public Health Scotland is no longer delivering a Healthy Working Lives Award but Plexus’ commitment to the
health and wellbeing of its employees will continue with a programme of activities aiming to encourage habits of
wellbeing and inspiring individuals to take responsibility for their own health.
Health and Safety continues to be a pivotal part of the business and remains at the centre of everything we do.
Plexus remains fully committed to continually improving safety standards and the safety culture across the business.
This is reflected in the business being once again lost time injury (“LTI”) free this year. Plexus has now passed its
seventh anniversary of this milestone in September 2022.
Plexus continues to comply with the requirements of the API Q1/ISO 9001 and ISO 45001 standards to include the
retention of both API 6A and 17D Licences. These accreditations demonstrate Plexus’ capability and determination
to operate under the highest standards.
The IT Department provides technology leadership for Plexus, including governance, information security, software
development and expertise in deploying modern information technologies to improve company efficiency. Plexus
has continued to develop its inhouse systems to ensure the Company is able to react swiftly to changing market
requirements, and constantly review the Company’s IT infrastructure.
Strategy and Future Developments
Technology
Plexus’ proprietary POSGRIP technology involves applying compressive force to the outside of a wellhead or
pipe, to flex it inwards. As the bore of the vessel moves inwards, it makes contact with an inner pipe (or hanger)
on the inside. Sufficient contact force is generated to hold the inner member in place through friction between the
two components, whilst at the same time creating a superior metal to metal seal. The Company’s strategy is
primarily focused on delivering the highest standard of wellhead design for the upstream oil and gas markets
around the world, and one which has already proven to be uniquely advantageous in terms of safety features,
operational efficiency, and cost savings for Jackup drilling, especially HP/HT applications, and for surface
production. The Company is now focused on replicating this past success in other wellhead markets including
Plexus Holdings plc Annual Report 2022
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Strategic Report continued
surface production, subsea, gas storage and geothermal, as well as other initiatives such as a POSGRIP Crown
Plugs and POSGRIP Lateral Trees. Plexus’ reentry into the exploration rental wellhead for the Jackup drilling
market will be built on nonPOSGRIP technology but with specific benefits and features including “through
the BOP”.
POSGRIP wellhead designs deliver many advantages over conventional “slip and seal” and “mandrel hanger”
wellhead technologies for surface exploration and land and platform production applications. These include larger
metal to metal seal contact areas, virtual elimination of movement between parts, fewer components, simplified
design and assembly, enhanced corrosion resistance, simpler manufacture, long term integrity, annulus management,
and reduced installation and maintenance costs.
Plexus’ POSGRIP enabled product suite also includes the innovative Python® Subsea Wellhead as well as the
POSSET Connector® for use in the growing decommissioning market. We believe the Python subsea wellhead is
important as it can eliminate the need for wear bushings, packoffs, lockrings, and lockdown sleeves, whilst
delivering instant rigid lockdown in all directions, and is fully reversible for ease of workover, sidetracking or
abandonment. These design simplifications and features not only reduce the risk of installation problems and safety
issues, they also significantly reduce installation time and the number of trips that are needed such that it has been
independently estimated that over ten days of savings per well can be achieved in deepwater under certain
conditions which, depending on water depth, Plexus estimates could result in a saving of over $10m for the operator.
The POSSET Connector, which is designed to reconnect to bare conductor pipe for well reentry or permanent
abandonment operations, creates a solid connection with reliable sealing directly against the pipe, and retains bend
and load capabilities at 80% of pipe strength. The Directors believe that such features mean that Plexus’ wellhead
equipment sets and delivers a superior standard. Apart from the operational time savings and related safety benefits,
at an engineering level the Company has demonstrated that its technology can raise and even exceed the integrity
of wellhead testing and sealing to that of premium couplings, which supports its claim that wellheads no longer
need to be the weak link in the well architecture chain.
POSGRIP frictiongrip technology has wide ranging applications both within and outside the oil and gas industry.
As POSGRIP is a method of engineering and not a product in its own right, where there is an opportunity for the
technology to improve the performance of conventional products the Company will look to integrate POSGRIP
so that the benefits together with “HG” sealing can be realised organically or in conjunction with partners, including
licensees. In line with this strategy, in November 2020 Plexus entered into a licence agreement with Cameron
International Limited, which grants the Schlumberger group company a nonexclusive licence to use the POSGRIP
and HG® metaltometal seal method of wellhead engineering for the development of conventional and
unconventional oil and gas surface wellheads. The scope of this licence was further expanded in December 2021.
Schlumberger continue to make good progress with their engineering and testing of their new wellhead which will
incorporate Plexus technology, and it is anticipated that marketing and sales by Schlumberger to its customers will
begin in the first half of 2023 calendar year.
In addition to POSGRIP Technology, Plexus is now reentering the Jackup Exploration Wellhead market with
Cameron’s Exact and Centric wellhead and mudline suspension products. These products are tried and tested, and
well suited to the exploration market as they are “through the BOP” products which deliver crucial time savings
and safety benefits over conventional wellhead products. As the exploration market regrows in the North Sea and
internationally, these products, combined with Plexus’ experience and reputation in this business means that we
are well placed to win a significant share of the work now being planned.
Business Model and Markets
The Company is proprietary technology driven and its extensive patent protected IP and many years’ worth of
specialist knowhow has been successfully deployed in hundreds of wells around the world. Its superior
performance, safety and operational advantages led to the Company becoming established initially as a leading
equipment and services provider to the niche Jackup exploration wellhead market. The Directors believe that this
success can over time be replicated and extended to the wider and much larger energy sectors including surface
production, subsea, geothermal and fracking applications based on its POSGRIP technology. In addition to this
there is a surge in interest in subsurface storage wells for gas, CO2 and hydrogen, for which POSGRIP technology
is also ideally placed.
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Strategic Report continued
Plexus has a good reputation for the agility and customer focus required to succeed in the Jackup Exploration
Wellhead market, and so the agreement with Cameron to allow Plexus to reenter this market with field proven
products is welcome and is anticipated to see an addition to revenues as global exploration activity increases.
Strategy
Plexus’ longterm goal is to establish POSGRIP technology as a new industry standard for wellhead and metal
sealing designs, whilst continuing to develop new Plexus products, which can also offer multiple benefits and
advantages to the industry in terms of improved safety, functionality, and cost and time savings. An example of
such extensions for POSGRIP technology is the Company’s connector technology, which is ideal for high integrity,
low fatigue applications. The Directors believe wellhead connectors, riser connectors, subsea jumper connectors,
pipeline connectors, tether tensioners and even vessel mooring connectors can all benefit from the simplicity of
POSGRIP.
The Company has taken on the Cameron Exact adjustable wellhead and Centric mudline suspension products.
This has resulted in initial minor orders for P&A and decommissioning work associated with this equipment.
We expect that the increase in activity and revenue from this business will be positive and will also allow Plexus
to reengage with customers at the exploration stage, which then has the potential to lead to further production and
subsea opportunities.
As the world and the oil and gas industry strives to implement a range of ESG compliant initiatives, particularly in
relation to achieving NetZero. Plexus believes that its technology can make a valuable contribution in terms of its
leakfree sealing capabilities, and its ‘through the BOP’ wellhead designs.
Key Performance Indicators
The Directors monitor the performance of the Group by reference to certain financial and nonfinancial key
performance indicators. The financial indicators include revenue, EBITDA, profit and loss, earnings per share,
cash balances, and working capital resources and requirements. The analysis of these is included in the financial
results section of this report. Nonfinancial indicators include Health and Safety statistics, equipment utilisation
rates, geographical diversity of revenues and customers, the level of ongoing customer interest and support,
geopolitical considerations such as emissions concerns and awareness, effectiveness of various research and
development initiatives, for example, in relation to new patent activity and inventions, and appropriate employee
headcount numbers and turnover rates. The nonfinancial key performance indicators are included within the
strategic report on page 9.
Principal Risks and Risk Management
There are a number of potential risks and uncertainties that could have an impact on the Group’s performance
which include the following.
(a) Political, legal and environmental risks
Plexus participates in a global market where the exploration and production of oil and gas reserves, and even
the access to those reserves can be adversely impacted by changes in political, operational, and environmental
circumstances. This has for example been evidenced by the impact of the war in Ukraine. The current global
political and environmental landscape, particularly in relation to climate change issues and NetZero goals, and
the relentless move away from hydrocarbons to, for example renewables, continues to demonstrate how any
combination of such factors can generate risks and uncertainties that can undermine commercial opportunities
and trading conditions. Some risks are of course unforeseen, and one such significant risk took the form of the
global pandemic caused by COVID19 which materialised in 2020 and continued in the prior year. Although
Plexus has taken all reasonable steps to mitigate the effects of this risk, both economic and to the health and
wellbeing of our employees, customers and suppliers by complying with legislation and taking measures to
ensure business continuity, the negative impact has clearly been felt. Such risks also extend to legal and
regulatory issues, and it is important to understand that these can change at short notice. For example ongoing
and future changes to oil and gas industry windfall taxes may have an adverse impact on investment levels.
Plexus Holdings plc Annual Report 2022
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Strategic Report continued
To help address and balance such risks, the Group where possible seeks to broaden its geographic footprint
and customer base, as well as actively look to forge commercial relationships with large industry players.
The Company continues to closely monitor the potential impact and risks of the UK’s exit (“Brexit”) from
the European Union (“EU”). This includes assessing and monitoring the potential impact of the introduction
of trade tariffs and the potential supply chain disruption that could result from increased customs checks at
borders and related matters. Plexus has an IPled business model, which provides it with operational flexibility
and the ability to respond to and mitigate some of the potential impacts of the different scenarios resulting
from the UK’s exit from the EU. In the meantime, Plexus has amongst other activities obtained an Economic
Operator Registration and Identification (“EORI”) number to enable the Company to continue to import and
export with the EU.
(b) Oil and Gas Sector Trends
It is readily understood that the world continues to move away from coal as part of the COP21 as well as the
COP26 and COP 27 pronouncements, together with other climate change objectives in relation to the ongoing
need to urgently reduce CO2 and CH4 (methane) emissions. However, the commercial and environmental
dynamics between traditional hydrocarbons in terms of coal, oil and gas is not the only trend to consider.
New technologies, particularly in relation to renewables such as wind and solar, alternative energies and
developments such as the increasing use of electric vehicles and corresponding improvements in battery
storage life, and wave energy, could all in the future prove very disruptive to the traditional oil and gas industry
and the corresponding demand for exploration and production equipment and services. However, it is also
recognised that the world will continue to need hydrocarbons as an energy and materials source, and in
particular gas for many years to come, and indeed currently global demand for hydrocarbons is forecast to
continue to grow for the foreseeable future. It should be noted that the climate change impact of methane is
now better understood by environmentalists, regulators and the oil and gas industry and that it is essential
that methane wellhead leaks are prevented whenever and wherever possible. The impending Methane
Emissions Reduction Act in the US and similar legislation being progressed in Europe demonstrate regulations
are increasingly becoming more stringent.
(c) Technology
Having originally proved the superior qualities of POSGRIP technology within the Jackup wellhead
exploration market which culminated in the sale of that business to FMC Technologies Limited, a subsidiary
of TechnipFMC (Paris:FTI, NYSE:FTI) (jointly “TFMC”), in early 2018, the Company has focused on
establishing its technology and equipment in other markets including surface production wellheads, subsea
and decommissioning, both organically and through licence partners. Plexus has since reentered the rental
exploration wellhead market with nonPOSGRIP designed equipment following a licence agreement with
Schlumberger in August 2021. Further, in November 2020 Plexus entered into a licence agreement with
Cameron International Limited, which grants the Schlumberger group company a nonexclusive licence to
use the POSGRIP and HG® metaltometal seal method of wellhead engineering for the development of
conventional and unconventional oil and gas surface wellheads. The scope of this licence was further expanded
in December 2021.
(d) Competitive risk
The Group operates in highly competitive markets and often competes directly with large multinational
corporations who have greater resources and are more established, and who are more resilient to extended
adverse trading conditions. This risk has become more concentrated over recent years as a result of the large
oil service company competitors becoming even larger and more influential through a series of mergers and
acquisitions. These major oil service and equipment company consolidations have therefore magnified such
issues as competitors reduce in number but increase in size, influence, and reach. Unforeseen product
innovation or technical advances by competitors could adversely affect the Group, and lead to a slower take
up of the Group’s proprietary technology. To mitigate this risk, Plexus maintains an extensive suite of patents
and trademarks, and actively continues to develop and improve its IP, including adding to its existing extensive
‘knowhow’ to ensure that it continues to be able to offer unique superior wellhead design solutions.
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Plexus Holdings plc Annual Report 2022
Strategic Report continued
(e) Operational
Plexus, like many other oil service companies, has had to make significant reductions in its workforce numbers
over the past few years as a result of a volatile oil price and market challenges and a corresponding reduction
in drilling activity and related levels of capex spend. These adverse trading conditions had been magnified
since early 2020 by the Covid19 pandemic, which in turn has coincided with an acceleration in the world’s
desire to reduce its dependence on hydrocarbons, particularly following the start of the war in Ukraine in
February 2022. Therefore, although there are now some encouraging signs of a pickup in drilling activity, it
is possible that the industry and Plexus could experience difficulties in rehiring past or new employees and
this could deprive Plexus of the key personnel necessary for expanding operational activities, as well as R&D
initiatives, at the rate that may be required. Plexus has developed effective recruitment and training procedures,
which combined with the appeal of working in a company with unique technology and engineering solutions
will hopefully help to mitigate such risks. In addition, there are signs that certain pressure groups such as Just
Stop Oil and Extinction Rebellion are increasing their level of activity and this may also impact on oil and
gas investment and drilling activities, at least in the West.
(f) Going Concern, liquidity, and finance requirements
In an economic climate that in many ways remains uncertain, it has become increasingly possible for potential
sources of finance to be closed to businesses for a variety of reasons that have not been an issue in the past.
Some of these may even relate to the lender itself in terms of its own capital ratios and lending capacity where
financial pressures and constraints can apply. Also, the significant decline in the size of Plexus’ market cap
is a negative factor if consideration is given to raising additional funds in the public markets. Furthermore,
a number of large and influential institutions have actively divested oil and gas investments and declared that
further investments and funding will not be made available for oil and gas projects as a result of climate
change concerns and as part of the move to NetZero. The Group undertakes cashflow forecasting throughout
the year to ensure the goingconcern assumption is still appropriate. The recent raising of funds from
convertible loans is an example of this and helps to ensure the Group has adequate working capital headroom
to see it through the next 12 months.
(g) Credit
The main credit risk is attributable to trade receivables. Where the Group’s customers are large international
oil and gas companies the risk of nonpayment is significantly reduced, and therefore is more likely to be
related to client satisfaction and/or trade sanction issues. Where smaller independent oil and gas companies
are concerned, credit risk can be a factor. Customer payments can potentially involve extended periods of
time especially from countries where exchange control regulations can delay the transfer of funds outside
those countries. As Plexus begins to establish international licensee relationships there may be instances
whereby certain capital and royalty payments could be due some way into the future and as such greater credit
risk than exists under normal payments terms could apply. The Group’s exposure to credit risk is
monitored continuously.
(h) Risk assessment
The Board has established an ongoing process for identifying, evaluating, and managing the more significant
risk areas faced by the Group. One of the Board’s control documents is a detailed “Risks assessment &
management document”, which categorises risks in terms of business (including IT), compliance, finance,
cash, debtors, fixed assets, other debtors/prepayments, creditors, legal, and personnel. These risks are assessed
and updated as and when appropriate and can be associated with a variety of internal and external sources
including regulatory requirements, disruption to information systems including cybercrime, control
breakdowns and social, ethical, environmental and health and safety issues.
(i) COVID-19
Although the regulations around COVID19 were relaxed during the year, Plexus places the health and safety
of its employees as its highest priority and in line with this has implemented various protocols. The Board
continuously monitors the situation, should Government guidance change.
Plexus Holdings plc Annual Report 2022
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Strategic Report continued
Section 172 Statement
This section serves as the section 172 statement and should be read in conjunction with the full Strategic Report
and the Corporate Governance Report. Section 172 of the Companies Act 2006 requires directors to take into
consideration the interests of stakeholders in their decision making. The Directors continue to have regard to the
interests of the Company’s employees and other stakeholders, including shareholders, customers and suppliers,
Licence Partners and the community and environment, through positive engagement and when making decisions.
Acting in good faith and fairly between members, the Directors consider what is most likely to promote the success
of the Company for its members in the long term and to protect the reputation of the Company.
Shareholders
Plexus seeks to develop an investor base of longterm holders that are aligned to our strategy. By communicating
our strategy and objectives, we seek to maintain continued support from our investor base. Such opportunities have
been compromised by the financial performance of Plexus over the past few years, and the resultant decline in the
size of the market cap of the business. It is the Directors’ intention that as soon as positive news flow begins to be
generated a fresh approach to the investment community market to both existing and new potential shareholders
will take place in conjunction with its advisors. Important issues include financial stability and protecting and
strengthening the value of our intellectual property. Engagement with shareholders is a key element to this objective
and methods of engagement are detailed in the Corporate Governance Report on pages 23 to 36, although over the
past years, as a result of the Covid pandemic, such interactions have been adversely impacted; in common with
many other businesses those impacts have gradually lessened over the past year since the rollout of the vaccine
programme and we are able to resume “normal” interaction levels. During the year, the Finance Director supported
by other members of the executive team, the Company’s broker, and the Investor Relations advisor, engaged where
possible with investors by email, presentations, direct conversations, and adhoc meetings. In the prior year the
Company relaunched its website to provide investors and other stakeholders with an improved platform to access
information about the Company. The website includes details of the LSE “Green Economy Mark” status, which
was awarded in July 2021, and associated NetZero commentary. During the year several key decisions were made
by the board, including the reentering of the exploration market, the decision to sell a building (currently held as
an asset held for sale at the financial year end), and post year end the raising of funds through convertible loans.
All of these decisions are aimed at increasing longterm shareholder value.
Employees
The Group’s UK staff are engaged by the Company’s subsidiary Plexus Ocean Systems Limited based in Aberdeen,
Scotland. Being a relatively small company with just over 30 employees largely operating in one location, there is
a high level of visibility regarding employee engagement and satisfaction. The Company is engaged with a specialist
firm of benefits advisers who are able to offer a comprehensive service to employees as well as to the Company.
The Company consults with employees on matters of competency, training, and health and safety as detailed in the
Corporate Governance Report on pages 23 to 36. During the year, the Company successfully achieved seven
continuous years with no Lost Time Incidents (LTI’s) and this successful safety culture has continued beyond that
anniversary to the date of writing. In the course of the year under review, there was a gradual return of staff from
homeworking to permanent working in the office; at the time of writing, all staff are now fully returned to office
based working. The challenges of maintaining close contact with employees presented by remote working were
very successfully managed by use of appropriate software such as Microsoft Teams alongside the use of a secure
VPN and other network security protocols. The easing of restrictions has enabled more inperson contact to be
achieved and the Company is now operating under normal – and importantly, safe – direct conditions.
Customers and Suppliers
The Company is committed to acting ethically and with integrity in all business dealings and relationships. Fostering
good business relationships with key stakeholders including customers and suppliers is important to the Company’s
success. The Board seeks to implement and enforce effective systems and controls to ensure its supply chain is
maintaining the highest standard of business conduct in line with best practice including in relation to antibribery
and modern slavery.
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Strategic Report continued
Licence Partners
The Company engages with Licence Partners in a way that follows the same principles as those applied to
relationships with other customers and suppliers. Additionally, the Company engages with its Licence Partners to
support their efforts to achieve commercial success by holding as and when required technical workshops, technical
training and data transfer. Following the announcement in November 2020 of entering into a nonexclusive surface
wellhead licencing agreement with Cameron and the extension of this agreement in December 2021, regular Teams
meetings and occasional face to face meetings have been held as part of the process of transferring Plexus’ relevant
IP so that Cameron can design and develop its own lowcost wellhead with POSGRIP technology inside.
The licence agreement with our Russian partner LLC Gusar was indefinitely suspended by Plexus in March 2022
following the Russian invasion of Ukraine and remains suspended.
Community and Environment
The Company has minimal environmental impact in the localities in which it operates. This clearly helps the
Company meet its corporate objectives in this regard but is never taken for granted. In the year under review, the
Company met its target for waste management and in general continues to operate in a manner that is open, honest,
and socially responsible.
G Stevens
Director
24 November 2022
Plexus Holdings plc Annual Report 2022
18
Board of Directors
Jerome Jeffrey Thrall BBA MBA (aged 73), Non-Executive Chairman
Jeff joined Thrall Enterprises, Inc. (“TEI”), a familyowned holding company headquartered in Chicago, USA, in
1980 as vice president of corporate development of TEI’s subsidiary, Nazdar Company, a manufacturer and
distributor of ink jet, screen printing, flexo inks and supplies. Jeff was named President of TEI in 1995. Prior to
joining TEI, Jeff’s professional career included a number of appointments in investment banking, commercial
lending and administration.
Bernard Herman van Bilderbeek BSc M. Eng (aged 74), Chief Executive
Ben founded the Plexus business in 1986. He has over 40 years’ experience in the industry in both engineering and
management roles, and previously held senior positions with Vetco Offshore Industries, DrilQuip, and Ingram
Cactus. Following a career at Vetco, where Ben rose to the position of General Manager of UK Engineering, he
went on to found his own oil and gas consultancy company, VBC Consultants, in 1982. During this time, his clients
included Amoco, Marathon Oil, FMC Corporation and DrilQuip. In 1986, Ben founded Plexus and went on to
merge the wellhead division of his company with Ingram Cactus where he became President Eastern Hemisphere.
In 1996 Ben regained the Plexus Ocean Systems Limited name through which POSGRIP technology was invented
and then developed and commercialised for the oil services wellhead equipment market.
Graham Paul Stevens BA (Hons) (aged 64), Finance Director
Graham has broad experience in financial, corporate, and operational management within both public and private
companies including J Sainsbury plc, BSM Group Limited, Sketchley Group plc, and Fii Group plc. He has been
involved in a range of industries as a director, investor, and advisor, and overseen a number of acquisitions and
disposals, as well as the implementation of turn around and growth strategies. Graham was, until its sale to Betsson
AB in 2017, a nonexecutive director of Netplay TV PLC, the AIM listed largest UK interactive TV gaming
company. He was previously a nonexecutive director of NRX Global Inc. a worldwide Asset Information
Management solutions provider used by leading companies in asset intensive industries, including oil and gas.
Craig Francis Bryce Hendrie M. Eng (Oxon) (aged 49), Technical Director
After gaining a master’s degree in Engineering Science from the University of Oxford, Craig began his career with
ICI plc in 1996 as a machines engineer. He joined Plexus in 1998 and was instrumental in the development, testing
and analysis of the original POSGRIP products. As Technical Director, Craig is responsible for overseeing new
technology and concept development, product testing and analysis, as well as pursuing new applications for
POSGRIP technology both internally and externally.
Charles Edward Jones BSc M. Eng (Age 63), Non-Executive Director
Charles has over 30 years of senior management and Board experience in the energy sector. In 2007, Charles was
CEO of Houstonbased Forum Oilfield Technology, a global oilfield products company which he successfully
merged with three other companies in 2010 to create Forum Energy Technologies (NYSE: FET) and where he
remained as President until 2013. Prior to Forum, Charles was COO of privately owned Hydril Company LP, where
he played a leading role in the US based drilling and downhole products company’s IPO in 2000 and subsequent
sale for US$2.1 billion. Before joining Hydril, Charles served as Director of Subsea Businesses for Cooper Cameron
Corporation where he developed the global subsea production business. Charles is a former Chairman of the
Petroleum Equipment Suppliers Association, a Distinguished Alumni of the Cullen College of Engineering at the
University of Houston and graduate of the Advanced Management Program a Harvard Business School.
Kunming Liu (Aged 45), Non-Executive Director
Kunming has over 20 years’ experience in corporate finance and financial accounting. She currently holds the
position of Vice President and Chief Administrator of HITIC Energy, an emerging oil and gas development company
based in Canada, which is a subsidiary of Jereh Oilfield Services Group, a multibilliondollar Chinese oil services
provider. Prior to this, Ms Liu was the Financial Director of Jereh Energy Services Corporation, a wholly owned
subsidiary of Jereh. Additionally, Ms Liu holds a major in financial accounting from Shandong Cadres Institute of
Economics and Management in China.
19
Plexus Holdings plc Annual Report 2022
Directors’ Report
The directors present their annual report together with the audited financial statements for the year ended
30 June 2022.
Directors who served during the year
J. Jeffrey Thrall
Ben van Bilderbeek
Graham Stevens
Craig Hendrie
Charles Edward Jones
Kunming Liu
Research and development
The Group actively engages in various ongoing research and development initiatives designed to expand and
develop the range of commercial applications deriving from its technology, including an inhouse R&D engineering
team. For the year, R&D expenditure including capitalised wage and salary costs totalled £0.39m (2021: £0.24m).
Results and dividends
The results for the year show a loss from continuing operations before taxation of £5.56m (2021: loss £4.37m),
and a loss from discontinued operations before taxation of £nil (2021: gain £20k) and are set out on page 50.
The directors do not recommend the payment of a final dividend for the year ended 30 June 2022 (2021: nil).
Corporate governance
This is the subject of a separate report set out on page 23. This is an expanded report following the adoption of the
Quoted Companies Alliance Corporate Governance Code in line with the AIM Rules of the London Stock Exchange
that require all AIMlisted companies to adopt a recognised corporate governance code against which they must
comply or explain why there is any divergence in complying with that code.
Related party transactions
Details of related party transactions are set out in Note 29 in the financial statements.
Financial instruments and risk management
The Group maintains a commercial objective of contracting in sterling whenever possible. In circumstances where
this is not possible, the Group converts foreign currency balances into sterling on receipt so far as they will not be
used for future payments in the foreign currency. The Group maintains risk management policies which are set out
in more detail in Note 26 to the accounts.
Streamlined Energy and Carbon Reporting Summary
The Group is below the threshold to report on its Greenhouse gas emissions and energy consumption.
Subsequent event
In October 2022 the Group raised £1,550,000 through the issue of Convertible Loan Notes (“CLNs”), which will
be used for working capital and to fund the Group’s activities as it seeks to capitalise on the increasing pipeline of
opportunities within its target markets.
Going concern
The directors, having made appropriate enquiries, believe that the Group has adequate resources to continue in
operational existence for the foreseeable future. The Group continues to adopt the going concern basis in preparing
the financial statements.
Plexus Holdings plc Annual Report 2022
20
Directors’ Report continued
Directors’ interests
The directors who served during the year and to the date of this report are listed below.
The interests of the directors who held office during the year in the shares of the Company at 30 June 2022 were
as follows:
Number of
Number of
Ordinary Shares Ordinary Shares
of 1p each
2021
of 1p each
2020
J. Jeffrey Thrall1
Ben van Bilderbeek2
Graham Stevens
Craig Hendrie
Charles Edward Jones
Kunming Liu
44,307,513
58,077,461
15,100
12,600
–
–
44,307,513
58,077,461
15,100
12,600
–
–
1. J. Jeffrey Thrall has an indirect beneficial interest in a company which controls 32.477% of Mutual Holdings
Limited. The number of Ordinary shares held by Mutual Holdings Limited in the Company at 30 June 2022
was 42,700,001 (2021: 42,700,001). Additionally, J. Jeffrey Thrall has both a direct and an indirect beneficial
interest in Thrall Enterprises Inc., a company which holds 1,591,512 Ordinary shares in the Company, and he
holds 16,000 Ordinary shares directly.
2. Ben van Bilderbeek is settlor of a trust which controls 59.962% of the shares of Mutual Holdings Limited and
the entire issued share capital of OFM Investment Limited. At 30 June 2022, Mutual Holdings Limited held
42,700,001 shares and OFM Investment Limited held 15,069,767. Additionally, Ben van Bilderbeek holds
307,693 Ordinary shares directly.
Retirement and re-election of Directors
Mr Thrall and Ms Liu will retire by rotation at the Annual General Meeting (“AGM”) and, being eligible, will offer
themselves for reelection.
Substantial shareholdings and interests in Shares
At the date of this Annual Report the Company is aware of the following shareholdings in excess of 3% of the
Company’s issued ordinary share capital:
Shareholder
Mutual Holdings Limited
OFM Investment Limited
CGWL Nominees Limited
Vidacos Nominees Limited
Hargreaves Lansdown Nominees Limited
Jereh International (Hong Kong) Co. Ltd
HSDL Nominees Limited
Interactive Investor Services Nominees Limited
Shares Held
% In Issue
share capital
42,700,001
15,069,767
7,698,020
7,295,395
7,171,129
4,468,537
3,251,065
3,065,479
42.51%
15.00%
7.66%
7.26%
7.14%
4.45%
3.24%
3.05%
Executive 2005 Share Option Scheme and Non-Executive 2005 Share Option Scheme
Details of the Executive and NonExecutive Schemes in addition to details of the directors’ remuneration can be
found in the Remuneration Committee Report on page 40.
Plexus is a nondiscriminatory employer, which aims to eliminate unfair discrimination, harassment, victimisation,
and bullying. The Group is committed to ensuring that all individuals are treated fairly, with respect and are valued
irrespective of disability, race, gender, health, social class, sexual preference, marital status, nationality, religion,
employment status, age or membership or nonmembership of a trade union.
21
Plexus Holdings plc Annual Report 2022
Directors’ Report continued
Disclosure of information to auditors
The directors who held office at the date of approval of this Directors’ Report confirm that, so far as they are each
aware, there is no relevant audit information of which the Company’s auditor is unaware; and each director has
taken steps that they ought to have taken as a director to make themselves aware of any relevant audit information
and to establish that the Company’s auditor is aware of that information.
Annual General Meeting
The AGM of the Company will be held on 23 December 2022. The Notice convening the meeting may be found
on the Company’s website www.plexusplc.com under the Investors tab.
The Notice comprises the resolutions that will be proposed at the Annual General Meeting.
Your attention is drawn to the Notes on each of these resolutions at the foot of the Notice and to the Notes generally.
Auditors
Crowe U.K. LLP has indicated its willingness to be reappointed as statutory auditor. In accordance with Section 489
of the Act, two resolutions for the reappointment of Crowe U.K. LLP as auditor of the Company and authorising
the directors to determine its remuneration will be proposed at the forthcoming AGM.
Company number
The Company is registered in England and Wales under Company Number 03322928.
By order of the Board
G Stevens
Director
24 November 2022
Plexus Holdings plc Annual Report 2022
22
Corporate Governance
Chairman’s Introduction
Plexus’ longterm goal is to establish POSGRIP friction grip technology as a superior industry standard for wellhead
and metal sealing systems, whilst continuing to develop new POSGRIP based products, which can also offer
multiple benefits and advantages to the industry in terms of improved safety, functionality, and cost and time
savings. Key to this is the Board ensuring the Company is managed for the longterm benefit of all shareholders,
by effective and efficient decision making which may only happen where a culture of corporate governance
is engendered.
Plexus remains committed to a culture built on its objectives of developing the products described above for the
stated purposes, and its strategic aims and business model are consistent with that culture. The Board promotes a
healthy culture within the business by actively encouraging a collegiate manner of working amongst all staff.
It monitors and assesses the culture from time to time through contact as appropriate with staff at all levels which it
is able to do because of the relatively small number of staff Plexus employs. The Board also has the benefit if required
of feedback from the annual personal development appraisal reviews which all staff are required to complete.
The Board has adopted the Quoted Companies Alliance Corporate Governance Code in line with the AIM Rules
of the London Stock Exchange that require all AIM companies to adopt a recognised corporate governance code
against which they must comply or explain why there is any divergence in complying with that code. The Board
considers Plexus complies in all material respects with the principles of the QCA Corporate Governance Code
although as indicated in the summary below, the adoption of certain informal procedures rather than formal
procedures to reflect the size of the Company and the composition of the Board, does not constitute full compliance
in all respects. The disclosures made within the principles comprising the QCA Corporate Governance Code are
anticipated to evolve over time.
Principle 1: Establish a strategy and business model which promotes long-term value for shareholders
Plexus has developed a range of products and applications based on its patentprotected POSGRIP frictiongrip
method of wellhead engineering. The Company is focused on establishing this technology and equipment in a range
of sectors including surface production wellheads, subsea and decommissioning, both organically and through
licence partners. In line with this strategy, in November 2020 Plexus entered into a licence agreement with Cameron
International Limited, which granted the Schlumberger group company a nonexclusive licence to use the
POSGRIP and HG metaltometal seal method of wellhead engineering for the development of conventional and
unconventional oil and gas surface wellheads. The scope of this licence was extended in December 2021.
In August 2021 Plexus has taken the opportunity to reenter the exploration rental wellhead market from Jackup
rigs market which it had previously been successful in before selling the division (with the exception of Russia
and the CIS) to TechnipFMC in February 2018. This activity will now be built around nonPOSGRIP technology
with bespoke Plexus design features, and “through the BOP” for enhanced safety. Shortly after the beginning of
the conflict in Ukraine, all licensed activities in Russia and the CIS were suspended indefinitely.
Since it was established, Plexus has focused on being an innovative, IPled company mainly built around its
proprietary POSGRIP technology. POSGRIP was designed to address limitations associated with conventional
wellhead technology particularly in terms of metal sealing and has subsequently raised standards for HP/HT
wellhead applications. POSGRIP enables Plexus to provide operators with superior solutions, offering unique
safety and operational advantages, while at the same time delivering significant time and cost savings on the surface
and, the Board in due course anticipates moving into the subsea sector. Thanks to POSGRIP, Plexus has
successfully raised wellhead test standards to equal or exceed those of premium couplings and there are numerous
applications and products beyond Jackup exploration drilling which the Board believes could benefit from the
POSGRIP method of engineering now and in the future.
The Company has, over many years, invested, and indeed continues to invest in R&D and IP development and
areas and applications outside of Jackup exploration wellheads, including in addition to surface production and
subsea wellhead equipment, proprietary connector technology. This suite of new products and applications has
grown significantly and includes: the Python Subsea Wellhead (a new standard for subsea wellheads – where a JIP
was supported by BG, Royal Dutch Shell, Wintershall, Maersk, Total, Tullow Oil, Eni, Senergy, and Oil States
23
Plexus Holdings plc Annual Report 2022
Corporate Governance continued
Industries Inc); the development of the POSSET Connector® (“POSSET”) product for the growing
decommissioning and abandonment market; development of HP/HT dual marine barrier risers to provide an
efficient, safe and costeffective solution for use on Jackup rigs; an innovative HP/HT TieBack connector product
and a Well Tree product. Plexus is also assessing opportunities in geothermal drilling and for gas storage. Plexus
can also offer outlet valves and Xmas trees, resulting in a complete package offering to its customers.
Prior to the sale of the POSGRIP Jackup rental wellhead business to TFMC, Plexus successfully expanded its
focus as part of its strategy to raise the awareness of its superior technology with contracts extending to Asia,
Australia, China, Egypt, Middle East, Russia, and West Africa from the UKCS, and in the process became a supplier
to a wide customer base, including bluechip customers. An Asian business hub was established to increase the
supply of POSGRIP wellhead equipment and services to the Australian, Brunei, Indonesian, Malaysian, Thai, and
Singaporean oil and gas exploration and production markets. Strategic licence agreements were pursued, including
in 2016 with Gusar, and Konar, two independent Russian oil and gas equipment manufacturers, for the rental,
manufacture, and servicing of Plexus’ Jackup drilling exploration wellhead equipment into the Russian Federation
and the other CIS states’ oil and gas markets. The licencing relationship with Gusar is outside of the business
activities that were sold to TFMC. However, as noted above, all activities in Russia and the CIS have been suspended
indefinitely following the start of the war in Ukraine.
One of the key challenges faced by the Company continues to be the impact of a volatile oil price, which combined
with the overhang impact of Covid19 has resulted in a significant decline in capital spending and exploration
activity by the major E&P operators over the last couple of years. The Board is hopeful that this trend is now
reversing as the impact of under investment by the industry, partly due to the downturn in economic activity caused
by Covid19, and partly due to the desire to reduce dependence on hydrocarbons appears to be causing supply
problems and a significant spike in oil and gas prices. Furthermore, the ongoing conflict in Ukraine is causing
widely reported Russian oil and gas supply interruptions and constraints, and this has led to increased prices and a
surge in activity as the world scrambles to replace Russian hydrocarbons. Plexus sees this as positive indicator for
new business opportunities outside of Russia and is seeing a marked increase in tender opportunities.
Plexus’ longterm goal is to establish POSGRIP technology as a superior industry standard for wellhead and
leakfree metal sealing designs, whilst continuing to develop new products, which can also offer multiple benefits
and advantages to the industry in terms of improved safety, functionality, and cost and time savings. An example
of such extensions for POSGRIP technology is the Company’s connector technology, which is ideal for high
integrity, low fatigue applications. The Directors believe wellhead connectors, riser connectors, subsea jumper
connectors, pipeline connectors, tether tensioners and even vessel mooring connectors can all benefit from the
simplicity of POSGRIP.
Production wellheads are required for the entire field life, and the size of the market for production wellheads is
many times that of Jackup exploration wells. At the same time as the market shows signs of recovery there is a
major shift from coal and even oil to cleaner natural gas production. This should be a positive trend for Plexus as
it is widely recognised that gas leaks are very damaging to the atmosphere in terms of climate change, particularly
with regard to the impact of methane on the environment, and therefore the need for superior and reliable longterm
metaltometal leakfree sealing technology and integrity has never been greater.
In terms of performance, the Board monitors the Group by reference to certain financial and nonfinancial key
performance indicators. The financial indicators include revenue and margins, overhead expenses, EBITDA, profit
and loss, earnings per share and both fixed and working capital resources and requirements. Nonfinancial indicators
include Health and Safety statistics, employee welfare, geographical diversity of revenues and customers,
geopolitical considerations, effectiveness of various research and development initiatives, for example, in relation
to new patent activity and inventions and appropriate employee headcount numbers and turnover rates. The key
performance indicators of the Group are currently focused on both financial and nonfinancial key performance
indicators such as cash resources, research and development activities and commercialization objectives, including
licencing initiatives. Over time, as financial key performance indicators such as revenue streams become more
established it may be that for example licence income rather than sales revenue becomes more relevant.
Plexus Holdings plc Annual Report 2022
24
Corporate Governance continued
2: Seek to understand and meet shareholder needs and expectations
The Company remains committed to regular dialogue and communications with its shareholders to ensure that
its strategy, business model and performance are understood by the market. Inevitably the Covid pandemic has
had an adverse impact on such activities. Understanding what analysts and investors think about Plexus, and
helping these audiences understand our business, is part of moving our business forward and we welcome
dialogue with the market with the support of our broker Cenkos Securities and Investor Relations advisors
St Brides Partners. Such communications when and where appropriate include investor presentations,
RNS updates, responding to specific phone calls and emails, ad hoc meetings as required and results period
meetings, and our regular reporting. The Company also maintains a dedicated email address which investors
can use to contact the Company which is displayed on the website together with the Company’s address and
phone number – http://www.plexusplc.com/contactus
As the Company is too small to have a dedicated investor relations department, the Finance Director is primarily
responsible for reviewing communications received from members, and in conjunction as necessary with the CEO
and if appropriate the Board, before determining the most appropriate response.
Responses to shareholders are typically sent by email or letter in a timely manner.
Private shareholders
Our AGM is the main forum for dialogue with private shareholders. The Notice of Meeting is sent to shareholders
at least 21 days before the meeting. The chairs of the Board and all committees, together with all other Directors,
whenever possible attend the AGM and are available to answer questions raised by shareholders. Time is set aside
specifically to allow such questions from attending members to any board member. For each vote, the number of
proxy votes received for, against and withheld is announced at the meeting. The results of the AGM are subsequently
published on the Company’s corporate website under the Stock Exchange (RNS) Announcements tab –
https://www.plexusplc.com/rns/. However, in 2020 and 2021 as a direct result of the Covid19 pandemic, the
Company held “closed” annual general meetings where only a quorum of members was present in a compliant and
secure arrangement. The Board intends to return to prepandemic arrangements for this year’s AGM and looks
forward to welcoming shareholders once again in person.
Institutional shareholders
The Directors seek to build relationships with institutional shareholders, as well as long term private investors who
continue to remain supportive of the Company and its strategy. Shareholder relations are managed primarily by the
CEO and Finance Director, and supported by the Technical Director, as appropriate. The CEO and Finance Director
make presentations as required to institutional shareholders and analysts following the release of the fullyear and
halfyear results.
The Board as a whole is kept informed as necessary of the views and concerns of major shareholders and is aware
that a number of investors and sources of finance have actively begun to move away from investing in oil and gas
related companies. However, the Board believes that as the Company’s technology can claim to be greener than
conventional wellhead designs in terms of its leak proof sealing capabilities, that a case can be made for investing
in the technology not just on superior technology grounds, but also on green ones. Any significant investment
reports from analysts are also circulated to the Board. The NonExecutive Chairman and NonExecutive Directors
are available to meet with major shareholders if required to discuss issues of importance to them.
3: Take into account wider stakeholder and social responsibilities and their implications for
long-term success
During the year Plexus entered into an expanded licencing agreement with Cameron and post yearend reentered
the exploration wellhead market in conjunction with Cameron. Despite Plexus’ strategy continuing to evolve around
such different ways of exploiting its proprietary POSGRIP IP, the key stakeholders (both internal and external)
and the way we engage with them has not changed. Stakeholders continue to consist of shareholders, employees,
suppliers, customers, licensees and advisers.
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Plexus Holdings plc Annual Report 2022
Corporate Governance continued
Engaging with all our stakeholders as constructively as possible is important to Plexus, and we understand that
good relations and sound business practices and principles all contribute to helping make a business a success.
Feedback from shareholders is responded to where possible through interaction via letters, emails, phone calls,
meetings and the AGM.
Where necessary the Board is updated on stakeholder engagement feedback should any issues arise, to stay abreast
of stakeholder insights into what matters most to them and our business, and to enable the Board to understand and
consider such issues in relevant decisionmaking. Aside from our shareholders, suppliers and customers, our
employees are one of our most important stakeholder groups and the Board monitors relevant employee issues
through regular operating company operations reports.
Employees
Plexus is a nondiscriminatory employer which aims to eliminate unfair discrimination, harassment, victimisation
and bullying. The Group is committed to ensuring that all individuals are treated fairly, with respect and are valued
irrespective of disability, race, gender, health, social class, sexual preference, marital status, nationality, religion,
employments status, age or membership or nonmembership of a trade union.
Staff and staff development continues to be important to the Group. To achieve this, the Group operates inhouse
training and accredited competency programmes ensure that necessary skill levels are maintained.
Additionally, competency across the business has continued to evolve and broaden; particularly within workshop
and officebased staff areas. The workshop competency system has been developed under the OPITO standards
with a view to being accredited by OPITO. The officebased competency system has been developed under the
OPITO standard as it is a concise system that supports the requirements of ISO9001:2015, for which Plexus has
received and retains APIQR certification.
Importantly Health and Safety is an operational area for employee stakeholders where Plexus remains fully
committed to delivering the highest practical safety standards in everything we do. The Group continues to
maintain a positive safety culture which is aligned with our Company Safety Values and are pleased to report our
HSE culture remains strong across the business, and this is reflected by our LTCF and TRCF percentages both
being zero, with no major findings during our most recent LRQA certification surveillance audits set against the
ISO 45001:2018 standard.
Suppliers
The Plexus business model has been built around the conscious decision of not having its own manufacturing
facilities, and thereby avoids incurring fixed overheads associated with such activities. This means that
manufacturing is subcontracted to carefully selected and assessed manufacturers and machine shops who must
operate to prescribed high standards and requirements for delivering Plexus’ products’ highquality threshold levels.
Such relationships are of course important to Plexus and tend to be of a longterm nature reflecting the professional
manner in which business is conducted.
Customers
We continue to seek opportunities for continual improvement regarding our relationships with customers, and our
Business Management System complies with the ISO 45001 standard, demonstrating our commitment to attain
and sustain the highest standards possible and allow us to respond quickly to client demands.
Quality also remains a key focus in the delivery of our products and services demonstrated by our accreditation of
API Q1 certification in February 2020 along with ISO 45001 certification in January 2022.
Modern Slavery
In light of the ongoing activities and resultant human misery that have brought about the Modern Slavery Act 2015,
in 2018 a review of the requirements was carried out and a focus group was formed (HR, Executive Assistant,
Contracts & Supply Chain) to create a Business Code of Conduct, Supplier Code of Conduct, Modern Slavery
Statement and Whistleblowing procedure suitable for the business needs. Plexus takes such matters seriously, and
Plexus Holdings plc Annual Report 2022
26
Corporate Governance continued
it is considered good practice that Plexus manages its supply chain in line with the Modern Slavery Act to support
the legislative requirement placed on the majority of our clients. In addition, these business tools have proven to
be relevant for tendering processes as companies’ awareness levels about this pernicious crime increase.
4: Embed effective risk management, considering both opportunities and threats, throughout
the organisation
Audit, risk and internal control
Financial controls
The Company has an established framework of internal financial controls. These are reviewed by the Executive
Management, the Audit Committee and the Board as part of an ongoing assessment of significant risks by category
facing the Company.
The Group continues not to have an internal audit programme due to the small size of the administrative function
and the level of Director review and authorisation of transactions.
The Board is responsible for reviewing and approving overall Company strategy, approving revenue and capital
budgets and plans, and for determining the financial structure of the Company including treasury, tax and relevant
dividend policy. Monthly results and variances from plans and forecasts are reported to the Board. In addition, the
Board has a formal schedule of matters reserved for its decision which includes the setting of Company goals,
objectives, budgets and other plans. All directors have access to independent professional advice at the Company’s
expense, if required, as well as to the advice and services of the company secretary.
The Audit Committee assists the Board in discharging its duties regarding the interim and full year results, financial
statements, accounting policies, and operational and financial controls. Duties include:
(A)
to consider and recommend to the Board the approval of the appointment of the external auditors of the
Company, the audit fee and other external remuneration of the auditors, and any questions of resignation or
dismissal;
(B)
to ensure the independence and objectivity of the external auditors;
(C)
to discuss with the external auditors before each annual audit commences the nature and scope of the audit,
and other relevant matters;
(D)
any changes in accounting policies and practices;
to review the half year and annual financial statements before submission to the Board, focusing particularly on:
(1)
(2) major judgmental areas;
(3)
(4)
(5)
(6)
significant adjustments resulting from the audit;
the going concern assumption;
compliance with accounting standards; and
compliance with legal requirements.
(E)
to discuss problems and reservations arising from final audits, interim reviews or otherwise (if any), and any
matters the external auditors may wish to discuss (in the absence of the executive directors where necessary);
(F)
to review management’s letter of representation;
(G)
to review the nature and extent of nonaudit services provided by the external auditors (if any) and be satisfied
that the auditors’ independence and objectivity is maintained;
(H)
to keep under review the effectiveness of the Company’s internal controls and risk management systems;
(I)
to undertake an annual assessment of internal controls and risk management;
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Plexus Holdings plc Annual Report 2022
Corporate Governance continued
(J)
to review the Company’s statement on internal control systems prior to endorsement by the Board;
(K)
to consider the major findings of any internal investigations and management’s response;
(L)
to review any internal audit programme and ensure that it is adequately resourced (currently not applicable);
(M)
to consider other topics, as defined by and referred to the Audit Committee by the Board; and
(N)
to review the Company’s arrangements for its employees to raise concerns, in confidence, about possible
wrongdoing in financial reporting or other matters. The Committee shall ensure that these arrangements allow
proportionate and independent investigation of such matters and appropriate follow up action.
Risk assessment & management controls
The Board recognises that maintaining sound controls and discipline is key to managing the downside risks to our
plan. The Board has ultimate responsibility for the Group’s internal controls and for reviewing their effectiveness.
However, any such system of internal control can provide only reasonable, but not absolute, assurance against
material misstatement or loss. The Board considers that the internal controls in place, as summarised and explained
below are appropriate for the size, complexity and risk profile of the Group. The principal elements of the Group’s
internal control system include:
l Management of the daytoday activities of the Group by the Executive Directors;
l An organisational structure with defined levels of responsibility, which promotes responsible decisionmaking
and implementation while minimising risks;
l A comprehensive annual budgeting process producing an income statement, balance sheet and cash flow, which
are approved by the Board;
l Detailed monthly reporting of performance against budget;
l Control over key areas such as capital expenditure authorisation and banking facilities; and
l The Group continues to review its system of internal control to ensure compliance with best practice, while also
having regard to its size and the resources available. As part of such controls the Company maintains a “Risk
assessment & management document” which reviews as necessary both financial and nonfinancial controls
areas and risks including Business (including IT); Compliance; Finance; Cash; Debtors; Fixed Assets; Other
Debtors/Prepayments; Creditors; Legal and Personnel. Such risks are assessed and reviewed, and changes made
where appropriate. The key elements of the nonfinancial controls are set out below.
Standards and policies
The Board is committed to maintaining appropriate standards for the Company’s business activities and ensuring
that these standards are set out in written policies. Key examples of such standards and policies include the ‘Anti
Modern Slavery Policy’ and ‘Employee Code of Conduct’. Operating procedures for control of operations are
clearly documented and set out in operation manuals where a key emphasis is on the Company actively assessing
and minimising health and safety risks in all areas of the business and educating the workforce to provide as safe
a working environment as possible. Managers are responsible for the implementation of these procedures and
compliance is monitored.
Approval process
Material contracts are required to be reviewed by a senior Director of the Company and where necessary reviewed
by external legal Counsel.
Code of Conduct
Our internal Code of Conduct includes guidance to employees on business integrity, antibribery, gifts, intellectual
property and design rights.
Plexus Holdings plc Annual Report 2022
28
Corporate Governance continued
Legal controls
Contracting with customers that include large international oil companies inevitably requires the entering into at
times complex contracts where the need to address such issues as limitation of liability need careful review and
negotiation. The Company’s commercial personnel have full access to external legal advice to ensure that
appropriate steps are taken to help mitigate the damage that can result from poorly negotiated contracts.
5: Maintain the board as a well-functioning, balanced team led by the chair.
The Board currently comprises the NonExecutive Chairman, J. Jeffrey Thrall; three Executive Directors comprising
Ben van Bilderbeek (CEO), Graham Stevens (FD); and Craig Hendrie (Technical Director); and two NonExecutive
Directors, Kunming Liu and Charles Jones; and a Company Secretary (nondirector) is in attendance at board
meetings.
The Audit Committee comprises two NonExecutive Directors, J. Jeffrey Thrall and Charles Jones and is scheduled
to meet twice a year. It is the Audit Committee’s role to provide formal and transparent arrangements for considering
how to apply financial reporting and internal controls, whilst maintaining an appropriate relationship with the
independent auditors of the Group. In order to comply with best practice that at least one member has relevant
financial experience, the Chairman of the Board sits on the Audit Committee. The Audit Committee review the
Group’s policy on auditor rotation. The current auditors have served for 16 years and there are no current plans to
retender.
The Remuneration Committee comprises two NonExecutive Directors, J. Jeffrey Thrall and Charles Jones and
meets when required. It is the Remuneration Committee’s role to set remuneration packages for individual Directors.
Where necessary the Remuneration Committee obtains advice and research material from external remuneration
specialists. There was no requirement for the Remuneration Committee to meet during the year as currently it is
not felt appropriate to consider annual reviews or bonus arrangements.
The Board considers that the NonExecutive Directors bring an independent judgement to bear, although it is
recognised that factors such as length of service and shareholdings can have an impact. The Board is satisfied that
it has a suitable balance between independence on the one hand, and knowledge of the Company on the other, to
enable it to discharge its duties and responsibilities effectively. In view of the specialist nature of the Company’s
technology and IP, knowledge gained over time is considered an important part of the NonExecutives understanding
and therefore contribution to the business. The executive members of the Board have considered the independence
of their nonexecutive colleagues and have concluded they remain independent in the context that they provide
independent oversight of the Company removed from daytoday operations and constructively challenge the
executive members of the Board.
All Directors are encouraged to apply their independent judgement and to challenge all matters, whether strategic
or operational.
During the last financial year five Board meetings took place (including Board Committee meetings, but excluding
meetings of the Audit Committee, and, as disclosed above, the Remuneration Committee did not meet during the
last financial year), and key Board activities as listed below are included but are not exclusive:
l Discussed strategic priorities
l Discussed the Group’s financial strength and strategy, including capital investments, shareholder returns and
the dividend policy
l Reviewed the performance of the Company’s licensees
l Discussed actual and potential M&A activity
l Discussed the internal risk management and assessment report
l Reviewed feedback where relevant from shareholders post full and half year results
Details of the dates of meetings during the last financial year of the Board, Board Committee, and Audit Committee,
together with attendees are set out in the tables below.
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Plexus Holdings plc Annual Report 2022
Corporate Governance continued
All members of the Board are expected to attend all scheduled main Board meetings whenever possible, but for
practical purposes, the completion of the interim or full year accounts, or certain corporate transactions are delegated
to a committee of the board to which all directors are entitled to attend by whatever practical means possible.
The directors receive timely notice of each meeting along with an agenda and supporting papers which they review
in advance of each meeting.
Directors’ conflicts of interest
The Company has effective procedures in place to monitor and deal with conflicts of interest. The Board is aware
of the other commitments and interests and if necessary, the relevant Board member will recuse themselves from
the matter at hand so as to avoid any conflicts for the individual or the Company.
Executive Directors and NonExecutive Directors are expected to be available in person or virtually, and to have
spent sufficient time studying all papers relevant to the regular meetings. Additionally, they are required to similarly
attend meetings whenever required where nonroutine course of business activity is going on, such as the Board
approval of the expanded Licence Agreement with Cameron in November 2021, and the Jackup Exploration
Wellhead Agreements in August 2021.
The executive members of the Board have considered the independence of their nonexecutive colleagues and have
concluded they remain independent in the context that they provide independent oversight of the Company removed
from daytoday operations and constructively challenge the executive members of the Board.
Details of the Directors along with their experience and skills may be found here https://www.plexusplc.com/board
ofdirectors/
Audit Board
Board Board Committee Committee
2021: 03.08.2021 11.11.2021 11.11.2021 19.11.2021
Jeff Thrall
Ben van Bilderbeek
Graham Stevens
Craig Hendrie
Kunming Liu
Charles Jones
Audit Board Board
Committee Board Committee Board Board Committee
2022: 16.03.2022 16.03.2022 18.03.2022 18.07.2022 07.09.2022 19.10.22
Jeff Thrall
Ben van Bilderbeek
Graham Stevens
Craig Hendrie
Kunming Liu
Charles Jones
As already disclosed above, the Remuneration Committee did not meet during the last financial year.
6: Ensure that between them the Directors have the necessary up-to-date experience, skills and capabilities
The Board is satisfied that, between the Directors, it has an effective and appropriate balance of skills and
experience, including in the areas of finance, governance, commercial experience, public markets, oil and gas
industry, and international trade. All Directors receive regular and timely information on the Group’s operational
and financial performance. Relevant information is circulated to the Directors in advance of Board and Committee
meetings. The business reports regularly on its headline performance against its agreed budget, and the Board
reviews updates on performance and any significant variances are reviewed at each Board meeting. Directors’
Service contracts are available for inspection at the Company’s registered office and at the AGM. Further details
of the Directors’ experience and skills are set out on page 19 of this report.
Plexus Holdings plc Annual Report 2022
30
Corporate Governance continued
The Directors are experienced in their own fields, and they act on their own initiative in ensuring they remain up
to date in their respective skills where relevant by being members of relevant professional organisations, attending
seminars and conferences, attending continuing professional development courses to maintain any current
accreditation and approaching the Company to arrange training where and if it is considered appropriate. The Board
does not at the current time undertake specific due diligence on or carry out a formal review of an individual
Director’s skills and training but is comfortable with such experience being appropriate from regular engagement
and dialogue with each Director. No such review is anticipated at the current time.
All Directors retire by rotation at regular intervals in accordance with the Company’s Articles of Association.
Appointment, removal and re-election of Directors
The Board makes decisions regarding the appointment and removal of Directors. As and when necessary suitable
candidates are identified and put forward for consideration and additionally external views are sought, and, if
relevant, background checks are undertaken in addition to any regulatory checks that are required. The process is
formal and transparent, and consideration is given to what skills the candidate brings to the Board and how they
will work and fit in with other Board members. The Company’s Articles of Association require that onethird of
the Directors must stand for reelection by shareholders annually in rotation and that any new Directors appointed
during the year must stand for reelection at the AGM immediately following their appointment. Jeff Thrall and
Kunming Liu will retire by rotation this year, and being eligible, will offer themselves for reelection.
Independent advice
All Directors can take independent professional advice in the furtherance of their duties, if necessary, at the
Company’s expense. In addition, the Directors have direct access to the advice and services of the Company
Secretary, whose role is to consider compliance with primarily the Companies Act 2006 along with all other relevant
legislation, the Finance Director, and the Company’s nominated adviser.
The Company has not had to engage external advisers to the Board other than its usual professional advisers during
the normal course of business.
The Company outsources the company secretarial duties and responsibilities to a firm of professional company
secretaries, (“the OutSourced Provider”), which engagement is overseen by the Finance Director. In addition to
the routine company secretarial compliance work, the OutSourced Provider fulfils a wideranging support role to
the FD on matters pertaining to the Companies Act, regulatory matters, transactional support, and ad hoc assistance
generally. Its services are also available to any other board director who may wish to make an approach for
independent advice which the OutSourced Provider strives to deliver in an impartial manner.
7: Evaluate board performance based on clear and relevant objectives, seeking continuous improvement
On an informal basis the Chairman Jeff Thrall and CEO Ben van Bilderbeek monitor the individual contributions
of each of the members of the team to ensure that:
l Their contribution is relevant and effective;
l That they are committed;
l Where relevant, they have maintained their independence; and
l The skills of the board members are appropriate for the size and complexity of the Group.
The responsibilities of the Chairman and CEO are summarised below:
The Chairman’s primary responsibility is to lead the Board effectively and to oversee the adoption, delivery and
communication of the Company’s corporate governance model. The Chairman has sufficient separation from the
daytoday business to be able to make independent decisions. The Chairman is also responsible for making sure
that the board agenda concentrates on the key issues, both operational and financial, including reviews of the
Company’s strategy and its overall implementation.
3131
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Corporate Governance continued
The CEO is responsible for the delivery of the business model within the timetable agreed by the Board. Keeps the
Chairman and Board up to date with operational performance, risks and other issues to ensure that the business
remains aligned with the agreed strategy.
Because of the relative size of the Company, the composition of the Board and the level of experience of each Board
member, the Company has not adopted a formal board evaluation process although keeps the topic under review and
would conduct an assessment of the effectiveness of the whole Board’s performance if it were considered beneficial.
The Board is mindful of the subject of succession planning, although has yet to adopt a formal process. At the present
time, any succession planning deemed necessary would be carried out on an ad hoc basis. The Board keeps this
subject under review. The Board is aware of the current shareholding structure and the significance of the founder’s
shareholding and is always mindful of the need to balance the interests of all shareholders and stakeholders alike.
8: Promote a corporate culture that is based on ethical values and behaviours
The culture of the Group is to treat all of our customers, suppliers, shareholders and staff fairly and with respect
and to be responsive and professional in all that we do whilst at all times being aware of the critical nature of the
industry we operate in and the importance of monitoring and managing a range of risks that include political, legal,
environmental, IP infringement, competitive risk, operational, liquidity and financial requirements, and credit.
The risk assessment of such areas is an ongoing process, and the Board has established a process for identifying,
evaluating and managing the more significant risk areas faced by the Group. One of the Board’s control documents
is a detailed “Risks assessment & management document” which categorises risks in terms of – Business (including
IT), Compliance, Finance, Cash, Debtors, Fixed assets, other Debtors/prepayments, Creditors, Legal, and Personnel.
These risks are assessed and updated on a regular basis and can be associated with a variety of internal and external
sources including regulatory requirements, disruption to information systems including cybercrime, control
breakdowns and social, ethical, environmental and health and safety issues.
The Company ensures that ethical values and behaviours are recognised and respected by the adoption of appropriate
policies which all members of staff are required to read and have ready access e.g. Code of conduct; antibribery
and corruption policy, HR policy etc.
9: Maintain governance structures and processes that are fit for purpose and support good
decision-making by the Board
Board programme
The Board meets regularly during each year and in accordance with its scheduled meeting calendar as listed below
and when necessary considers a formal agenda of reserved matters for its decision.
Companies Act Requirements
1.
2.
3.
4.
5.
Approval of interim and final financial statements.
Approval of the interim dividend and recommendation of the final dividend.
Approval of any significant changes in accounting policies or practices.
Appointment or removal of the company secretary.
Remuneration of the auditors and recommendations for the appointment or removal of auditors, following
recommendation of the Audit Committee.
Draft resolutions and corresponding documentation to be put forward to shareholders at a General Meeting.
6.
Stock Exchange/Financial Services Authority
7.
8.
Approval of all circulars, listing particulars and announcements.
Approval of press releases concerning matters decided by the Board.
Plexus Holdings plc Annual Report 2022
32
Corporate Governance continued
Board membership and Board committees
9.
Board appointments and removals, the overall remuneration policy and any special terms and conditions
attached to the appointment (subject to the recommendations of the Remuneration Committee).
10. Selection and terms of reference of chairman, chief executive and other executive directors.
11. Terms of reference and membership of Board committees.
12. Where applicable, appointment of the senior independent director. None is currently appointed, and the role
would be defined appropriate to requirements and circumstances applicable at the time.
13. Succession planning for the Board and senior management.
14. Continuance in office of Directors at the end of their office, where they are due to be reelected by shareholders
in general meeting or at any other time, subject to the law and the director’s service contract.
15. Reviewing reports from committees on activities and progress.
Strategy and Management
16. Overall management of the Group.
17. Approval of the Group’s longterm objectives and commercial strategy.
18. Approval of the annual Group budgets and any material changes to them.
19. Changes relating to the Group’s capital structure, listing or its status as a plc.
20. Oversight of the Group’s operations to ensure competent management, sound planning, adequate systems of
internal control, adequate accounting and other records are kept, and compliance with statutory and regulatory
obligations are achieved.
21. Review of performance against strategy, budgets, business plans and set objectives and implementation of
necessary corrective action.
22. Extending the Group’s activities into new business or geographic areas or ceasing all or any material part of
the Group’s business.
23. Changes to the Group’s management and control structure.
24. Capital expenditure projects.
25. Material, either by reason of size or strategically such as the granting of licences in relation to the Company’s
IP, contracts of the Company in the ordinary course of business (defined as the sale and rental of wellhead
equipment), above £750,000 for rental equipment, or above £350,000 p.a. for contracts of one year or more.
26. Major investments including the acquisition or disposal of interests of more than 5 percent in the voting shares
of any company or the making of any takeover bid.
27. Risk management strategy and review.
28. Treasury policies including foreign currency exposure
Miscellaneous
29. Review of the Company’s overall corporate governance arrangements and performance of the board,
its committees and the individual directors.
Investor relations management.
30. Determining ‘independence’ of the directors.
31.
32. Major changes in the rules of the company pension scheme.
33. Major changes in employee share schemes.
34. Formulation of policy regarding charitable donations.
35. Political donations.
36. Approval of the company’s principal professional advisers.
37. Litigation of any nature to be notified to the Board and any settlements above £5,000.
38.
Internal control arrangements, annual review and statement in the annual report, subject to recommendations
of the Audit Committee as appropriate.
39. Directors’ & Officers’ liability insurance.
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Plexus Holdings plc Annual Report 2022
Corporate Governance continued
40. Approval of the Group’s share dealing, code of conduct, health and safety, environmental and corporate social
responsibility policies.
41. Approval of thirdparty guarantees.
Prior to the start of each financial year, a schedule of Key Dates for that year’s Board and associated meetings is
compiled to align as far as reasonably practicable with the Company’s financial calendar, while also ensuring an
appropriate spread of meetings across the financial year.
The Key Dates schedule is updated throughout the year as necessary. This may be supplemented by additional
meetings as and when required, for example in relation to corporate activity. The Board and its Committees receive
appropriate and timely information prior to each meeting; a formal agenda is produced for each meeting, and Board
and Committee papers are distributed several days before meetings take place. Any Director may challenge
Company proposals and decisions are taken democratically after discussion. Any Director who feels that any
concern remains unresolved after discussion may ask for that concern to be noted in the minutes of the meeting,
which are then circulated to all Directors. Any specific actions arising from such meetings are agreed by the Board
or if relevant by a committee, and then followed up by the Company’s management.
Roles of the Board, Chairman and Chief Executive Officer.
The Board is responsible for the longterm success of the Company. There is a formal schedule of reserved Board
matters, and it is responsible for overall Group strategy; approval of major investments (whether Capex or Opex);
approval of the annual and interim results; annual budgets; dividend policy; and Board structure. It also monitors
the exposure to key business risks. There is a clear division of responsibility at the head of the Company. The
Chairman is responsible for running the business of the Board and for reviewing appropriate strategic focus and
direction. The Chief Executive Officer is responsible for proposing the strategic focus to the Board, implementing
it once it has been approved and overseeing the management of the Company through the Executive Team.
All Directors receive regular information on the Group’s operational and financial performance. Relevant
information is circulated to the Directors in advance of meetings. The business regularly reports on its headline
performance against its agreed budget, and the Board reviews updates on performance and any significant variances
are reviewed at each Board meeting. Senior executives below Board level attend Board meetings where appropriate
to present business updates.
Executive Team
The Executive Team consists of Ben van Bilderbeek (CEO), Graham Stevens (CFO) and Craig Hendrie (Technical
Director), with input from the subsidiary company Directors and teams, all of which are fulltime staff members
and are responsible for the daytoday management of the Group’s businesses and its overall trading, operational
and financial performance in fulfilment of that strategy, as well as plans and budgets approved by the Board of
Directors. They in conjunction with the Board manage and oversee key risks, and where appropriate management
development. Graham Stevens is responsible for overseeing shareholder communications, and Craig Hendrie leads
on R&D and engineering development activities. The Chief Executive Officer reports to the plc Board on issues,
progress and recommendations for change. The controls applied by the Executive Team to financial and
nonfinancial matters are set out earlier in this document.
Board Committees
The Board is supported by the Audit Committee and where necessary the Remuneration Committee. Each committee
has access to such resources, information and advice as it deems necessary, at the cost of the Company, to enable
each committee to discharge its duties. The duties of the Audit Committee have been outlined in the detail on
Principle 4 in this report.
The overall duties of the Remuneration Committee, which did not meet during the year are determining the policy
and all elements of the remuneration of the executive directors of the Company and other senior executives (“the
Executives”) of the Group and the duties of the Remuneration Committee are:
l to consider the basic salary paid to the Executives and any recommendations made by the Chairman of the
Company for changes to that basic salary
Plexus Holdings plc Annual Report 2022
34
Corporate Governance continued
l to consider any bonuses to be paid to the Executives and, in respect of any element of remuneration of an
Executive which is performance related, to formulate suitable performancerelated criteria and monitor their
operation, and to consider any recommendations of the Chairman of the Company regarding bonuses or
performancerelated remuneration
l to advise on and determine all performancerelated formulae relevant to the remuneration of the Directors of
the Company and to consider the eligibility of Directors for annual bonuses and benefits under long term
incentive schemes
l to administer all aspects of any executive share option scheme operated by or to be established by the Company
including but not limited to (subject always to the rules of that scheme and any applicable legal and Stock
Exchange requirements):
(1)
(2)
(3)
(4)
(5)
the selection of those eligible Directors of the Company and its subsidiary companies to whom options should
be granted
the timing of any grant
the numbers of shares over which options are to be granted
the exercise price at which options are to be granted
the imposition of any objective condition which must be complied with before any option may be exercised
l to have regard in the performance of the duties set out in this clause to any published guidelines or
recommendations regarding the remuneration of directors of listed companies and formation and operation of
share option schemes (in particular the guidelines published by the Association of British Insurers and National
Association of Pension Funds) which the Remuneration Committee considers relevant or appropriate
l to consider and make recommendations to the Directors of the Company concerning disclosure of details of
remuneration packages and structures in addition to those required by law
l to consider other benefits granted to the Executives and any recommendations of the Chairman of the Company
for changes in those benefits
l to consider the pension arrangements applicable to the Executives
l to consider and make recommendations in respect of the terms of the service contracts of the Executives and
any proposed changes to these contracts (including, without limitation, any compensation payments, notice
periods, or other entitlements under these contracts)
l to consider other matters relating to the remuneration of or terms of employment applicable to the Executives
and referred to the Remuneration Committee by the Board
The governance framework is subject to review on an ongoing basis. No changes to the governance framework are
currently planned.
10: Communicate how the company is governed and is performing by maintaining a dialogue with
shareholders and other relevant stakeholders
The Company communicates with shareholders through Regulatory News Service announcements, the Annual
Report and Accounts, fullyear and halfyear announcements, the Annual General Meeting (AGM), and when
required onetoone meetings with existing or potential institutional new shareholders.
Most daytoday shareholder interaction and communication is the responsibility of the CEO and the CFO.
A range of corporate information (including all Company announcements) is also available to shareholders,
investors, and the public on the Company’s corporate website, www.plexusplc.com
The Board receives when relevant, updates on the views of shareholders through briefings and reports from the
Company’s brokers, Cenkos Securities Plc.
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Plexus Holdings plc Annual Report 2022
Corporate Governance continued
The Company communicates with institutional investors where requested through briefings with management. In
addition, analysts’ notes and brokers’ briefings are reviewed to achieve a wide understanding of investors’ views.
Regular and open communication is encouraged between all layers of management to ensure that any issues or
concerns can be raised.
The Company announces the results of all votes on resolutions proposed at any general meeting of the members of
the Company by releasing an RNS to the London Stock Exchange immediately upon the conclusion of the meeting.
It has not had occasion to announce where a significant proportion of votes (e.g. 20% or more of independent votes)
has been cast against any particular resolution, although intends to include this information in the future, should
such an occasion arise, including a summary of the actions it would take to understand the reasons behind such a
voting result. The Company maintains on its website an increasing library of documents including all circulars to
shareholders, RNS news releases and historic documents which the Board considers adequate –
https://www.plexusplc.com/aimrule26/
Plexus Holdings plc Annual Report 2022
36
Audit Committee Report
Introduction
This report details how the Audit Committee (“the Committee”) has met its responsibilities under its terms of
reference. The Committee is a subcommittee of the Board and has the responsibility for reviewing and, where
appropriate, recommending the approval of the Annual Reports and Accounts and interim financial statements by
the Board with whom ultimate responsibility for their approval rests. The Committee does not believe it is
appropriate to have an internal audit function at this point in time as the Group is relatively small and not sufficiently
complex.
Members
The members of the Audit Committee are Jerome Jeffrey Thrall (Chairman) and Charles Jones. The Executive
Directors and the external auditors attend the meetings by invitation. The Board considers that the Committee has
an appropriate and experienced blend of commercial, financial and industry expertise to enable it to fulfil its duties,
and that the Committee Chairman has appropriate recent and relevant financial experience.
Committee Meetings
The Committee met twice during the year to 30 June 2021. One meeting related to the 201920 Annual Report and
Accounts, and the second meeting was to review and sign off the 2021 Interim Financial Statements. The external
auditors attended both meetings.
Role and Responsibilities
The Board has established an Audit Committee and set clear Terms of Reference so as to monitor the integrity of
the Group’s financial statements and the effectiveness of the Group’s internal financial controls.
The Terms of Reference are reviewed annually and amended where appropriate. During the year the Committee
worked with management, the external auditors, and other members of the senior management team in fulfilling
these responsibilities. The Committee considers financial reporting and internal controls. It also reviews the scope
and results of the external audit and the independence and objectivity of the auditors. It meets at least twice a year
and reviews the interim and annual financial statements before they are submitted for approval by the Board upon
its recommendation. The Committee considers annually whether the auditors remain independent for the purposes
of the audit and whether a separate internal audit function is required. As referenced above, the Committee does
not believe it is appropriate to have an internal audit function at this time
The Committee report deals with the key duties and areas in which it plays an active role and has responsibility.
These duties and areas include the following:
Financial reporting and related primary areas of judgement;
The external audit process;
i)
ii)
iii) Risk management and internal controls;
iv) Whistleblowing procedures;
v)
Consider and approve the appointment of the external auditors of the Company, the audit fee and other fees
for nonaudit related services;
vi) Ensure the independence and objectivity of the external auditors; and
vii) Review the external auditor’s management representations letter and management’s response.
37
Plexus Holdings plc Annual Report 2022
Audit Committee Report continued
Annual Report and Accounts
General
The Committee has satisfied itself that the 202122 Annual Report and Accounts have been prepared in accordance
UKadopted internal accounting standards, are fair, balanced and provide the information necessary for shareholders
to assess the Group’s performance, business model and strategy. The Committee reviewed the key risk areas as
identified in the Audit Plan document including revenue recognition and management override of controls.
The Committee understands that the auditors have followed their procedures for reviewing these risks and have
undertaken detailed testing as appropriate.
In preparing the financial statements for the period, the main area requiring the exercise of management judgement,
or a high degree of estimation was the valuation, and possible impairment, of intangibles. This was discussed with
the auditor. The Committee, having reviewed management’s assessment of impairment, concluded that the relevant
value in use was above the carrying value of the assets and hence no impairment provision was required. Further
information on the methodology and assumptions used in the valuation of intangible assets and the assessment of
impairment thereof is given in notes 1.g and 1.h to the consolidated accounts on page 54, and in the Parent company
Accounts on page 83
Going Concern
The Committee reviewed the going concern paper prepared by management including detailed monthly financial
forecasts, which included the twelve months from the date of signing the financial statements for 202122 and
included related assumptions, risks and opportunities, sensitivities, areas for mitigation and contingency plans.
Based on this review, the Committee has a reasonable expectation that the Group has adequate resources to continue
in operational existence for the foreseeable future, being the period of twelve months from the date of signing the
financial statements for 202122. Accordingly, the Committee concluded that it is appropriate to adopt the going
concern basis in preparing the annual financial statements.
Internal Control Systems
The Committee ensures that it monitors internal control systems reporting by the auditors and that there are no issues.
Risk Management
The Board has established an ongoing process for identifying, evaluating and managing the more significant risk
areas faced by the Group. One of the Board’s control documents is a detailed “Risks assessment & management
document” which categorises risks in terms of Business (including IT), Compliance, Finance, Cash, Debtors,
Fixed Assets, Other debtors/prepayments, Creditors, Legal, and Personnel. These risks are assessed and updated
when necessary and can be associated with a variety of internal and external sources including regulatory
requirements, disruption to information systems including cybercrime, control breakdowns and social, ethical,
environmental and health and safety issues. Further details on the Principal Risks and Risk Management may be
found in the Strategic Report on page 9 of the financial statements.
Board Conduct and Effectiveness Review
As reported in the Corporate Governance section of the financial statements because of the relative size of the
Company, the composition of the Board and the level of experience of each Board member, the Company has not
adopted a formal whole board evaluation process although keeps the topic under review and would conduct one if
it were considered necessary.
The Board is mindful of the subject of succession planning, although has yet to adopt a formal process and, the
Company having been in transition since the disposal of the rental wellhead Jackup business in 2018, any
succession planning deemed necessary would be carried out on an ad hoc basis. The Board keeps this subject under
review. The Board is aware of the current shareholding structure and the importance of the founder’s shareholding
and is always mindful of the need to balance the interests of all shareholders and stakeholders alike.
Plexus Holdings plc Annual Report 2022
38
Audit Committee Report continued
Auditor Independence
The Committee satisfied itself on the auditors’ independence. Mr John Charlton has replaced Mr Stephen Bullock
as the senior statutory auditor in this period, in accordance with the auditor’s internal mandatory rotation policy.
Whistleblowing
The Committee had no whistleblowing incidents reported directly or indirectly during the year to 30 June 2022.
The Report of the Audit Committee was approved by a Committee of the Board of Directors on and signed on its
behalf by:
Jerome J Thrall
Chairman of the Audit Committee
39
Plexus Holdings plc Annual Report 2022
Remuneration Committee Report
Introduction
Companies trading on AIM are not required to provide a formal remuneration report. However, in line with current
best practice this report provides information to enable a greater level of understanding as to how Directors’
remuneration is determined.
The Remuneration Committee of the Board is responsible for considering Directors’ remuneration packages. The
Committee comprises two NonExecutive Directors J. Jeffrey Thrall and Charles Jones. There was no requirement
for the Remuneration Committee to meet during the last financial year.
Remuneration policy
The Group’s policy is to attract, retain and motivate high calibre executives capable of achieving the Group’s
objectives. Executive Directors receive salaries, annual bonuses (as and when appropriate), medical cover, and
pension scheme contributions.
The Committee determines the policy of the overall remuneration package for Executive Directors and other senior
executives. Basic salaries and benefits of all employees are normally reviewed every year, and the Group and the
Committee as part of this process may seek advice from external remuneration consultants as and when appropriate.
In reviewing salaries, consideration is given to personal performance, the Group’s overall performance and external
comparative information.
An annual performance or transaction related bonuses may be payable to Executive Directors and senior staff, and
when appropriate an exercise is undertaken, again in conjunction where appropriate with external remuneration
consultants to look at market comparisons, benchmarks, relative performance as well as consideration of strategic
progress in addition to simply financial ones. Comparator group analysis includes oil and gas exploration companies
with broadly similar market capitalisations and numbers of employees, as well as oil and gas service companies
where, although the market capitalisation range is wide, it is still relevant as these are the sort of companies with
which Plexus may compete for talent.
Service contracts
The Executive Directors have service agreements with the Company dated 25 November 2005 subject to termination
upon twelve months’ notice being given by either party.
Pensions
The Group offers a contributory group stakeholder pension scheme, into which the Group makes matching
contributions up to a preagreed level of base salary; the scheme is open to Executive Directors and permanent
employees. Directors may alternatively choose to have contributions paid into existing personal pension plans, or
to receive salary in lieu.
Non-executive Directors
The NonExecutive Chairman, J. Jeffrey Thrall, entered into a Letter of Appointment with the Company dated
25 November 2005 for an initial term through to the first AGM and having been reelected as a director either party
can terminate upon three months’ notice being given. The subsequently appointed NonExecutive Directors, Charles
Jones and Kunming Liu, entered into their Letters of Appointment with the Company dated 18 September 2014,
and 17 December 2015 respectively, and having been reelected as a director at the first respective AGM following
their appointment, are subject to the same termination conditions as those applicable to Mr Thrall.
Plexus Holdings plc Annual Report 2022
40
Remuneration Committee Report continued
Directors’ remuneration
Details of Directors’ remuneration for the year are set out below:
Executive Directors
Ben van Bilderbeek
Graham Stevens
Craig Hendrie
Non-executive Directors
J Jeffrey Thrall
Charles Jones
Kunming Liu
Total
Salary & Fees
£
Benefits
£
295,815
167,191
138,777
–
–
–
––––––––––
601,783
––––––––––
5,881
15,328
1,236
–
–
–
––––––––––
22,445
––––––––––
Pension
£
–
–
19,857
2022
Total
£
2021
Total
£
301,696
182,519
159,870
348,595
185,216
159,389
–
–
–
––––––––––
19,857
––––––––––
–
–
–
––––––––––
644,085
––––––––––
–
–
–
––––––––––
693,200
––––––––––
The highest paid director is the Group CEO with total remuneration for the year of £302k (2020: £349K). This
compares to the average of all company employees (salaries and benefits plus pension) of £75k (2021: £78k).
Directors’ interest in share options
The options and awards have been granted pursuant to the Executive 2005 Share Option Scheme and NonExecutive
2005 Share Option Scheme to the following Directors:
Executive 2005 Share Option Scheme
Name
B. van Bilderbeek
B. van Bilderbeek
B. van Bilderbeek
B. van Bilderbeek
G. Stevens
G. Stevens
G. Stevens
G. Stevens
C. Hendrie
C. Hendrie
C. Hendrie
C. Hendrie
No of
options at
30/06/21 &
30/06/22
194,152
65,902
332,110
169,642
138,407
43,177
217,795
101,042
254,407
43,177
217,79
105,853
No of
Options
Vested at
30/06/22
194,152
65,902
332,110
169,642
138,407
43,177
217,795
101,042
254,407
43,177
217,79
105,853
Date of
Grant
09/12/05
20/06/07
17/12/09
25/03/11
09/12/05
20/06/07
17/12/09
25/03/11
09/12/05
20/06/07
17/12/09
25/03/11
Expiry
Date
08/12/25
19/07/27
13/12/29
24/03/31
08/12/25
19/07/27
13/12/29
24/03/31
08/12/25
19/07/27
13/12/29
24/03/31
Exercise
Price
0.59
0.385
0.41
0.60
0.59
0.385
0.41
0.60
0.59
0.385
0.41
0.60
No executive share options have been granted, lapsed, forfeited or exercised during the years to 30 June 2022 and
2021. No share options have been exercised since 2015.
41
Plexus Holdings plc Annual Report 2022
Remuneration Committee Report continued
Non-executive 2005 Share Option Scheme
No of
options at
30/06/21
No of
Lapsed
during options at
30/06/22
40,169
21/22
40,169 –
No of
Options
Date of Vested at
30/06/22
Grant
40,169
09/12/05
Expiry
Date
08/12/25
Exercise
Price
0.59
Name
J. Thrall
No nonexecutive share options have been granted, forfeited or exercised during the years to 30 June 2022 and 2021.
No options are expected to lapse at the AGM.
On 9 July 2015 the Board of Plexus approved certain amendments to the rules of the Plexus Holdings plc 2005
Share Option Scheme (the “Plan”) such that the Company is permitted to extend the exercise period for options
granted under the Plan by a further ten years. On 9 July 2015 the directors approved an amendment to the rules of
the scheme such that the Company is permitted to extend the exercise period for options granted under the scheme
by a further ten years. Subsequently on 8 June 2017, 13 December 2019 and 25 March 2021 the Company entered
into deeds of amendment with Ben van Bilderbeek, Graham Stevens, Craig Hendrie, and eleven employees in
respect of options granted to them on 20 June 2007 and 17 December 2009 and 25 March 2011 under the scheme,
to extend the exercise period by ten years, subject to all other terms of the scheme rules.
The lowest midmarket price of the Company’s shares in the year to 30 June 2022 was 2.80p on the 30th June 2022.
The high price in the period to 30 June 2022 was 14.35p on 9th August 2021. The midmarket price on 30 June
2022 was 2.80p.
The 6year history of the share price on reporting date (30 June) is as follows, 2022: 2.80p, 2021:
13.25p, 2020: 14.00p, 2019: 40.50p, 2018: 46.90p and 2017: 57.00p.
Total staff remuneration costs for the year, as set out in note 5 was £2.86m (2021: £2.81m). This compares to
distributions to shareholders of nil (2020: £nil).
Plexus Holdings plc Annual Report 2022
42
Statement of Directors’ Responsibilities
The directors are responsible for preparing the Directors’ Report, Strategic Report and the financial statements in
accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the
directors have elected to prepare the group and parent company financial statements in accordance with UKadopted
international accounting standards. 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 Company and of the Group
and of the profit or loss of the Group for that period. In preparing these financial statements, the directors are
required to:
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select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable accounting standards have been followed, subject to any material departures disclosed
and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
Group and the parent company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the
Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company
and enable them to ensure that the financial statements comply with the Companies Act 2006. They have a general
responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to
prevent and detect fraud and other irregularities.
The directors are further responsible for ensuring that the Strategic Report and the Report of the Directors and other
information included in the Annual Report and Financial Statements is prepared in accordance with applicable law
in the United Kingdom.
The directors are responsible for the maintenance and integrity of the corporate and financial information included
on the Group’s website (www.plexusplc.com). The work carried out by the auditors does not involve the
consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have
occurred in the accounts since they were initially presented on the website. Legislation in the UK governing the
preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
By order of the Board
G Stevens
Director
24 November 2022
43
43
Plexus Holdings plc Annual Report 2022
Independent Auditor’s Report to the Shareholders of Plexus Holdings plc
Opinion
We have audited the financial statements of Plexus Holdings plc (the “Parent Company”) and its subsidiaries (the
“Group”) for the year ended 30 June 2022, which comprise:
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the Group statement of comprehensive income for the year ended 30 June 2022;
the Group and Parent Company statements of financial position as at 30 June 2022;
the Group and Parent Company statements of cash flows for the year then ended;
the Group and Parent Company statements of changes in equity for the year then ended; and
the notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in the preparation of the financial statements is applicable
law and UKadopted international accounting standards.
In our opinion the financial statements:
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give a true and fair view of the state of the Group’s and of the Parent Company's affairs as at 30 June 2022
and of the Group’s loss for the period then ended;
have been properly prepared in accordance with UKadopted international accounting standards; and
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’s responsibilities for the audit
of the financial statements section of our report. We are independent of the Group and the Parent Company in
accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK,
including the FRC’s Ethical Standard as applied to listed entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
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.
We have identified going concern as a key audit matter, and our audit response to this and the directors’ assessment
of the Group’s and Parent Company’s ability to continue to adopt the going concern basis of accounting is disclosed
in the key audit matters section of this report.
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 and Parent Company’s ability
to continue as a going concern for a period of at least twelve months from when the financial statements are
authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the
relevant sections of this report.
Plexus Holdings plc Annual Report 2022
44
44
Independent Auditor’s Report to the Shareholders of Plexus Holdings plc
continued
Overview of our audit approach
Materiality
In planning and performing our audit we applied the concept of materiality. An item is considered material if it
could reasonably be expected to change the economic decisions of a user of the financial statements. We used the
concept of materiality to both focus our testing and to evaluate the impact of misstatements identified.
Based on our professional judgement, we determined overall materiality for the Group financial statements as a
whole to be £275,000 (2021 £205,000), based on 5% percent of Group loss before taxation (2021: approximately
4.6% of the Group’s loss before taxation). Materiality for the Parent Company financial statements as a whole was
set at £65,000 (2021: £40,000) based on a percentage of net assets. These metrics were considered to be those of
most interest to shareholders and users of the financial statements, given the Group’s trading activity.
We use a different level of materiality (‘performance materiality’) to determine the extent of our testing for the
audit of the financial statements. Performance materiality is set based on the audit materiality as adjusted for the
judgements made as to the entity risk and our evaluation of the specific risk of each audit area having regard to the
internal control environment. This is set at £192,500 (2021: £143,500) for the group and £45,500 (2021: £28,000)
for the parent. This level was set based on our assessment of the overall control environment, and a low level of
expected misstatements.
We agreed with the Audit Committee to report to it all identified errors in excess of £13,750 (2021: £20,000). Errors
below that threshold would also be reported to it if, in our opinion as auditor, disclosure was required on qualitative
grounds.
Overview of the scope of our audit
Our Group audit was scoped by obtaining an understanding of the Group and its environment, including the Group’s
system of internal control and assessing the risks of material misstatement in the financial statements. We also
addressed the risk of management override of internal controls, assessing whether there was evidence of bias by
the directors that may have represented a risk of material misstatement.
The Group and its subsidiaries are accounted for from one central operating location, the Group’s registered office.
There are two significant components in the Group: the Parent Company and Plexus Ocean Systems Limited.
These two entities were subject to full scope audits by ourselves.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) that we identified. These matters included 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.
This is not a complete list of all risks identified by our audit.
45
45
Plexus Holdings plc Annual Report 2022
Independent Auditor’s Report to the Shareholders of Plexus Holdings plc
continued
Key audit matter
How the scope of our audit addressed the key audit
matter
1. Impairment of intangible assets, including goodwill
(notes 11 and 12)
The Group carries intangible assets at a net book value
of £9.9 million (2021: £10.4 million). This balance is
primarily represented by intellectual property, patent
and other development expenditure.
Management prepare annual impairment calculations
to assess the carrying value of intangible assets as set
out in the accounting policy in notes 1g and 1h to the
financial statements.
The performance of the impairment review requires
management to make key judgements and assumptions.
As a result, we identified the impairment of intangible
assets, including goodwill, as a significant risk.
l We evaluated, in comparison to the requirements set
out in IAS 36, management’s assessment (using
discounted cash flow models) as to whether
goodwill or other intangible assets were impaired.
l We challenged, reviewed and considered by
reference to external evidence, management’s
impairment and fair value models as appropriate
and their key estimates, including the discount rate
and growth rates. We reviewed the appropriateness
and consistency of the process for making such
estimates.
Sensitivity analysis was performed by management
on the key assumptions such as the discount rate to
identify those assumptions to which that the goodwill
or intangible asset valuation was highly sensitive. We
have applied further sensitivity to create a worstcase
scenario and challenged management on the
likelihood of such a scenario occurring, and on what
remedial actions would be taken.
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l We challenged the likelihood of occurrence of key
contracts supporting the cashflows in the models.
We also had regard to other evidence that supports
the fair value less costs to sell of the intangibles.
2. Revenue recognition (notes 1d and 2)
Revenue is recognised in accordance with the
accounting policy set out in the financial statements.
The principal income stream during the period was
revenue from sale of equipment.
l We assessed that the accounting policy conformed
with the requirements of IFRS15 and tested its
application to a sample of contracts.
l We performed cut off testing to ensure revenue is
The principal areas of risk were considered to be
cutoff, being that revenue is recognised in the correct
period; and existence, being
that performance
obligations have been met and so revenue should be
recognised.
l
Given the significance of revenue to the financial result,
this is considered to be a key audit matter.
being recorded in the correct period.
A sample of revenue transactions were verified to
supporting invoices, delivery confirmation, and
traced through to receipt of cash.
Plexus Holdings plc Annual Report 2022
46
46
Independent Auditor’s Report to the Shareholders of Plexus Holdings plc
continued
Key audit matter
How the scope of our audit addressed the key audit
matter
3. Going concern (note 1b)
The Group has incurred a loss for the year, and has
made losses in previous periods. The level of cash and
liquid assets available to the Group has reduced during
the year, given the divestment of much of the Groups
investment portfolio (note 17).
Accordingly, the directors must assess whether the
Group and Parent Company has sufficient cash
balances to support its operations for a period of at least
12 months from the date of approval of the financial
statements.
We have identified going concern as a key audit matter
as a result of the judgements and estimates which the
directors make in their going concern assessment.
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l We obtained the director’s assessment of going
concern, which covered a period up to 30 November
2023, including cash flow forecasts for this period.
Income from sales receipts was challenged to
management against amounts that were currently
contracted.
Following our challenge, management produced a
stresstested version of their forecast excluding all
noncontracted income other than two contracts.
Management provided detail on the nature of these
two projects, and supporting detail over the
certainty of them proceeding.
The expenditure planned on administrative
expenses was compared to the prior year actual
costs, and expectations for the period considered.
The sensitivity of the cash flows in the stresstest
forecast was reviewed, including the impact of the
two noncontracted projects and projected income
from the sale of a building. If one or both of these
events occurred, the Group would not have
sufficient cash to support the operations in the
stresstest scenario.
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l Management consider that the conditions of the
stresstest to be an extreme scenario. In order to
address the potential outcome, a letter of support
has been provided by the Chief Executive, to
confirm he is willing to provide funding to the
Group up to £3 million if required to allow the
Group to meet its obligations as they fall due.
l We have obtained confirmation from a reputable
thirdparty source of the Chief Executive’s ability
to access these funds if required.
l We have assessed the completeness and accuracy of
the matters described in the going concern
disclosure within the significant accounting policies
as set out in Note 1b.
l We held discussions with management to determine
whether indicators of impairment existed in relation
to these balances and concurred with their conclusion
that an impairment review was required. The key
considerations were an assessment of the future
trading expectations for Plexus Ocean Systems
Limited, together with the carrying value of the
Group’s intangible assets and the market capitalisation
of the Group.
In assessing whether impairment was required,
because the recoverability of these amounts is
closely linked to the impairment consideration of
the intangible assets, our work was substantially
that as set out in KAM number 1 above.
l
47
47
Plexus Holdings plc Annual Report 2022
4. Carrying value of Parent Company investments
in subsidiaries and intercompany receivables
(parent company note 7)
The carrying value of investments in subsidiaries in the
Parent Company financial statements at 30 June 2022
was £8.3m (2021: £8.3m) as well as an intercompany
balance of £7.5m (2021: £20.5m) after a current year
impairment of £12.8m. The value of these investments
and the recoverability of the intercompany balance are
almost entirely dependent on the successful trading of
the subsidiary Plexus Ocean Systems Limited, utilising
the IP included as intangible assets in the Group
financial statements.
Independent Auditor’s Report to the Shareholders of Plexus Holdings plc
continued
Our audit procedures in relation to these matters were designed in the context of our audit opinion as a whole. They
were not designed to enable us to express an opinion on these matters individually and we express no such opinion.
Other information
The directors are responsible for the other information contained within the annual report. The other information
comprises the information included in the annual report, other than the financial statements and our auditor’s report
thereon. Our opinion on the financial statements does not cover the other information and, except to the extent
otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is
materially inconsistent with the financial statements or our knowledge obtained in the 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.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion based on the work undertaken in the course of our audit
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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 directors’ report and strategic report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In light of the knowledge and understanding of the Group and the Parent Company and their environment obtained
in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report
to you if, in our opinion:
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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 the directors for the financial statements
As explained more fully in the statement of directors’ responsibilities set out on page 43, 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.
Plexus Holdings plc Annual Report 2022
48
48
Independent Auditor’s Report to the Shareholders of Plexus Holdings plc
continued
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 noncompliance 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:
l We obtained an understanding of the legal and regulatory frameworks that are applicable to the Group, and the
procedures in place for ensuring compliance. The most significant regulations identified were the Companies
Act 2006, AIM rules and the QCA Corporate Governance Code. Our work included direct enquiry of the
directors, who oversee all legal proceedings, reviewing Board minutes and inspection of correspondence.
l We communicated the relevant laws and regulations identified to all members of the engagement team, and
remained alert to any indication of noncompliance with laws and regulations, or potential fraud, throughout
our audit work.
As part of our audit planning process we assessed the different areas of the financial statements, including
disclosures, for the risk of material misstatement. This included considering the risk of fraud where direct
enquiries were made of management and those charged with governance concerning both whether they had
any knowledge of actual or suspected fraud and their assessment of the susceptibility of fraud. We considered
the risk was greater in areas that involve significant management estimate or judgement. Based on this
assessment we designed audit procedures to focus on the key areas of estimation or judgement, this included
specific testing of journal transactions, both at the year end and throughout the year.
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l We used data analytic techniques to identify any unusual transactions or unexpected relationships, including
considering the risk of undisclosed related party transactions.
Owing to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements of the
financial statements may not be detected, even though the audit is properly planned and performed in accordance
with the ISAs (UK).
The potential effects of inherent limitations are particularly significant in the case of misstatement resulting from
fraud because fraud may involve sophisticated and carefully organised schemes designed to conceal it, including
deliberate failure to record transactions, collusion or intentional misrepresentations being made to us.
A further description of our responsibilities is available on the Financial Reporting Council’s website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our 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.
John Charlton (Senior Statutory Auditor)
for and on behalf of
Crowe U.K. LLP
Statutory Auditor
London
24 November 2022
49
49
Plexus Holdings plc Annual Report 2022
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2022
Revenue
Cost of sales
Gross profit
Administrative expenses
Operating loss
Finance income
Finance costs
Share in profit / (loss) of associate
Other income
Non-recurring item
Fairvalue adjustment on asset held for sale
Loss before taxation
Income tax charge / (credit)
Loss after taxation from continuing operations
Loss after taxation from discontinued operations
Loss for year
Other comprehensive income
Total comprehensive
income for the year attributable to the owners of the parent
Loss per share
Basic from continuing operations
Diluted from continuing operations
Basic from discontinued operations
Diluted from discontinued operations
Notes
2
4
6
7
14
8
9
10
2022
£’000
2,306
(813)
–––––––
1,493
(5,784)
–––––––
(4,291)
164
(640)
111
125
–––––––
(1,025)
–––––––
(5,556)
(1,901)
–––––––
(7,457)
–
–––––––
(7,457)
–
–––––––
(7,457)
–––––––
(7.42p)
(7.42p)
–
–
2021
£’000
2,017
(1,062)
–––––––
955
(5,501)
–––––––
(4,546)
143
(103)
(77)
211
–––––––
–
–––––––
(4,372)
262
–––––––
(4,110)
(392)
–––––––
(4,502)
–
–––––––
(4,502)
–––––––
(4.09p)
(4.09p)
(0.39p)
(0.39p)
Plexus Holdings plc Annual Report 2022
50
Consolidated Statement of Financial Position
at 30 June 2022
Assets
Goodwill
Intangible assets
Property, plant and equipment
Financial assets
Investment in associate
Deferred tax asset
Right of use asset
Total non-current assets
Asset held for sale
Inventories
Trade and other receivables
Cash and cash equivalents
Total current assets
Total Assets
Equity and Liabilities
Called up share capital
Shares held in treasury
Share based payments reserve
Retained earnings
Total equity attributable to equity holders of the parent
Liabilities
Lease liabilities
Total non-current liabilities
Trade and other payables
Lease liabilities
Bank Lombard facility
Total current liabilities
Total liabilities
Total Equity and Liabilities
Notes
11
12
15
17
14
8
27
16
18
19
21
22
23
27
20
27
25
2022
£’000
767
9,165
821
101
723
–
941
–––––––
12,518
–––––––
1,100
1,394
971
5,840
–––––––
9,305
–––––––
21,823
–––––––
1,054
(2,500)
674
16,307
–––––––
15,535
–––––––
761
–––––––
761
–––––––
1,245
324
3,958
–––––––
5,527
–––––––
6,288
–––––––
21,823
–––––––
2021
£’000
767
9,644
2,961
3,042
721
1,899
1,245
–––––––
20,279
–––––––
–
575
1,051
5,175
–––––––
6,801
–––––––
27,080
–––––––
1,054
(2,500)
674
23,764
–––––––
22,992
–––––––
1,085
–––––––
1,085
–––––––
643
316
2,044
–––––––
3,003
–––––––
4,088
–––––––
27,080
–––––––
These financial statements were approved and authorised for issue by the board of directors on 24 November 2022
and were signed on its behalf by:
G Stevens
Director
C Hendrie
Director
Company Number: 03322928
51
Plexus Holdings plc Annual Report 2022
Consolidated Statement of Changes in Equity
for the year ended 30 June 2022
Balance as at 30 June 2020
Total comprehensive income for the year
Balance as at 30 June 2021
Total comprehensive income for the year
Balance as at 30 June 2022
Called Up
Share
Capital
£’000
1,054
–
––––––––––
1,054
–
––––––––––
1,054
––––––––––
Shares
Held in
Treasury
£’000
(2,500)
–
––––––––––
(2,500)
–
––––––––––
(2,500)
––––––––––
Share
Based
Payments
Reserve
£’000
674
–
––––––––––
674
–
––––––––––
674
––––––––––
Retained
Earnings
£’000
28,266
(4,502)
––––––––––
23,764
(7,457)
––––––––––
16,307
––––––––––
Total
£’000
27,494
(4,502)
––––––––––
22,992
(7,457)
––––––––––
15,535
––––––––––
Plexus Holdings plc Annual Report 2022
52
Consolidated Statement of Cash Flows
for the year ended 30 June 2022
Notes
Cash flows from operating activities
Loss before taxation from continuing activities
Loss before taxation from discontinued activities
Loss before tax
Adjustments for:
Depreciation and amortisation charges
Profit on disposal of property, plant and equipment
Share in (profit)/loss of associate
Property rental and dilapidations income
Lease liability reassessment
Fair value adjustment on asset held for sale
Impairment of associate
Fair value adjustment on financial assets
Investment income
Interest expense
Changes in working capital:
(Increase)/decrease in inventories
Decrease/(increase) in trade and other receivables
Increase/(decrease) in trade and other payables
Cash used in operating activities
Income taxes (paid)/refunded
Net cash used in operating activities
Cash flows from investing activities
Funds divested/(invested) in financial instruments
Property rental and dilapidations income
Purchase of intangible assets
Purchase of property, plant and equipment
Preparation costs for asset held for sale
Proceeds of sale of property, plant and equipment
Interest and investment income received
Dividend income from associate
Deferred proceeds from sale of discontinued operation
Net cash generated in investing activities
Cash flows from financing activities
Draw down of Lombard facility
Repayments of lease liabilities
Interest paid
Net cash inflow from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at 1 July 2021
Cash and cash equivalents at 30 June 2022
25
2022
£’000
(5,556)
–
–––––––
(5,556)
1,679
(4)
(111)
(114)
–
1,025
109
513
(164)
127
(819)
80
602
–––––––
(2,633)
(2)
–––––––
(2,635)
–––––––
2,428
114
(447)
(253)
(180)
3
164
–
–
–––––––
1,829
–––––––
1,914
(347)
(96)
–––––––
1,471
–––––––
665
5,175
–––––––
5,840
–––––––
2021
£’000
(4,372)
20
–––––––
(4,352)
1,701
(1)
77
(123)
25
–
19
(143)
84
295
(255)
(135)
–––––––
(2,808)
157
–––––––
(2,651)
–––––––
(66)
123
(235)
(170)
–
1
143
100
2,186
–––––––
2,082
–––––––
2,044
(342)
(45)
–––––––
1,657
–––––––
1,088
4,087
–––––––
5,175
–––––––
53
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements
1.
Summary of significant accounting policies
The following accounting policies have been applied consistently in dealing with items which are considered
material in relation to the financial information.
Basis of preparation
a.
The consolidated financial statements have been prepared in accordance with UKadopted international
accounting standards and interpretations issued by the International Accounting Standards Board and are in
accordance with the Companies Act 2006.
There are a number of standards, amendments to standards, and interpretations which have been issued by
the IASB that are effective in future accounting. The Directors’ have assessed the impact of these standards
and do not expect any significant impact to the Group on their adoption.
The Group financial statements are presented in sterling and all values are rounded to the nearest thousand
pounds except where otherwise indicated.
The financial information has been prepared under the historical cost convention except where fair value
adjustments are required.
Going concern
b.
The Group’s activities and an outline of the developments taking place in relation to its products, services
and marketplace are considered in the Strategic Review on pages 9 to 16 along with an explanation of revenue,
trading results and cash flows.
Note 26 to the Financial Statements sets out the Group’s financial risks and the management of capital risks.
At the year end, the Group had cash and cash equivalents of £5.84m, financial assets with a value of £0.1m
and a drawdown Lombard facility with a balance of £3.96m, which was subsequently repaid post year end.
The Group also had a further cash inflow of £1.55m from the issue of convertible loan notes subsequent to
the year end (note 30).
Accordingly, after careful enquiry and review of available financial information, including multiscenario
projections and cash flows for the period to 30 November 2023 (which included a severe, but plausible
downside scenario), the Directors believe that the Group has adequate resources to continue to operate for
the foreseeable future. A letter of support from the Chief Executive has also been provided, confirming that
he will provide financial support to the Group if required, to meet its obligations as they fall due. The Directors
therefore consider it appropriate to continue to adopt the going concern basis of accounting in the preparation
of the consolidated and company financial statements.
Basis of consolidation
c.
The Group’s financial statements consolidate the financial statements of Plexus Holdings plc and the entities
it controls (its subsidiaries) and are drawn up to 30 June each year. Control comprises the power to govern
the financial and operating policies of the investee so as to obtain benefit from its activities and is achieved
through direct and indirect ownership of voting rights, currently exercisable or convertible potential voting
rights. Subsidiaries are consolidated from the date of their acquisition, being the date on which the Group
obtains control, and continue to be consolidated until the date that such control ceases. The financial statements
of subsidiaries are prepared for the same reporting year as the parent company, using consistent accounting
policies. All intercompany balances and transactions, including unrealised profits arising from intra group
transactions, have been eliminated in full. Unrealised losses are eliminated unless the transaction provides
evidence of an impairment of the asset transferred.
Within twelve months of the date of acquisition of a subsidiary undertaking a reassessment is made of the
fair value of the assets and liabilities acquired in order to assess any provisional values used in
initial accounting.
Plexus Holdings plc Annual Report 2022
54
Notes to the Consolidated Financial Statements continued
1.
Summary of significant accounting policies (continued)
The financial statements of the Company and its subsidiaries are prepared in sterling (the functional currency),
which is the currency that best reflects the economic substance of the underlying events and circumstances
relevant to the Group. Transactions and balances in foreign currencies are converted into sterling in accordance
with the principles set forth by IAS 21 (“The Effects of Changes in Foreign Exchange Rates”). Accordingly,
transactions and balances have been converted as follows:
l Monetary assets and liabilities – at the rate of exchange applicable at the reporting date; and
l
Income and expense items – at exchange rates applicable as of the date of recognition of those items.
Exchange gains and losses are recognised in the consolidated statement of comprehensive income.
d.
Revenue
Sale of equipment
The Group sells a range of equipment derived from its proprietary technology, spares and ancillary equipment.
Revenue from the sale of equipment is recognised when performance obligations are met. This is considered
to be on acceptance of the equipment by the customer, or where contractual delivery date is specified in the
terms and conditions of sale. Invoicing and subsequent payment follow the transfer of ownership.
Rental income
The Group rents out equipment to customers. Revenue from rental contacts, all of which are short term,
is recognised in the statement of comprehensive income on a straightline basis as the performance obligations
are satisfied over time. Rental income is invoiced on a monthly basis.
Service income
The Group provides Field Service Technicians to its customers, on daily rate basis. Revenue from service
contracts are recognised on a performance basis as work is undertaken. Customers are invoiced following
receipt of a signed field service ticket.
Royalty income
The Group has licensing agreements which are subject to royalty payments. Royalty income is recognised
under the terms and conditions of the underlying licensing agreement, and revenue is recognised when
performance obligations are satisfied.
Rebillable income
The Group passes on third party costs to customers at cost plus markup where applicable. The level of
markup is specified in the underlying contract with the customer. Revenue is invoiced and recognised, along
with the associated expenditure in the period in which it relates.
Cost of sales
e.
Cost of sales includes salary and related costs for service personnel, depreciation, refurbishment costs on
rental assets and other costs which are directly attributable to revenue generating projects.
Income taxes and deferred taxation
f.
The income tax credit for the period comprises current and deferred tax. Tax is recognised in the income
statement, except to the extent that it relates to items recognised in other comprehensive income or directly in
equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.
The current income tax credit is calculated on the basis of the tax laws enacted or substantively enacted at the
reporting date in the countries where the Company and its subsidiaries operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable
tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts
expected to be paid to the tax authorities.
55
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
1.
Summary of significant accounting policies (continued)
Deferred income tax is recognised on temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the consolidated financial statements.
Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted
by the reporting date and are expected to apply when the related deferred income tax asset is realised, or the
deferred income tax liability is settled.
Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will
be available against which the temporary differences can be utilised.
As set out in note 23 the Group operates a share option scheme. Where the market price of the shares at the
yearend exceeds the option price there is a potential tax deduction. This is treated as a deferred tax asset.
The portion of the expected future tax deduction which is less than or equal to the associated cumulative
IFRS2 charge is recognised in the income statement. The balance of the credit is recognised directly in equity.
Goodwill
g.
Purchased goodwill (representing the excess of the fair value of the consideration given over the fair value
of the separable assets acquired) arising on business combinations in respect of acquisitions is capitalised.
Goodwill is not amortised; it is measured at cost less any accumulated impairment losses. Goodwill is
reviewed for impairment at least annually.
Goodwill is monitored by management at the operating segment level. All goodwill has been allocated to the
single operating segment, which is considered to be a group of similar cash generating units (CGU’s) for
impairment purposes.
Intangible assets and amortisation
h.
Patents are recorded initially at cost and amortised on a straightline basis over 20 years which represents the
life of the patent. The Group operates a policy of continual patent enhancement in order that technology
enhancements and modifications are incorporated within the registered patent, thereby protecting the value
of technology advances for a full 20year period.
Intellectual Property rights are initially recorded at cost and amortised over 20 years on a straightline basis.
The technology defined by the Intellectual Property is believed to be able to generate income streams for the
Group for many years; key Intellectual Property is protected by patents; the lowest common denominator in
terms of economic life of the intangible assets is the life of the original patents and therefore the life of the
Intellectual Property has been matched to the remaining life of the patents protecting it.
Development expenditure is capitalised in respect of development of patentable technology at cost including
an allocation of own time when such expenditure is incurred on separately identifiable technology and its
future recoverability can reasonably be regarded as assured. Any expenditure carried forward is amortised
on a straightline basis over its useful economic life, which the directors consider to be 20 years.
Computer software is amortised over 2 to 5 years on a straightline basis.
In all cases the amortisation period represents the expected useful life of the asset.
Amortisation is charged to the Administrative Expenses line of the Statement of Comprehensive Income.
Expenditure on research and development, which does not meet the capitalisation criteria, is written off to
the Statement of Comprehensive Income in the period in which it is incurred.
Plexus Holdings plc Annual Report 2022
56
Notes to the Consolidated Financial Statements continued
1.
Summary of significant accounting policies (continued)
The carrying value of intangible assets is reviewed on an ongoing basis by the directors, and where
appropriate, provision is made for any indication of impairment in value. Where impairment arises, the
recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).
Where it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the
recoverable amount of the cashgenerating unit to which the asset belongs.
The 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 discount rate that reflects
the current market assessments of the time value of money and the risks specific to the asset. If the recoverable
amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced
to its recoverable amount.
Any impairment loss would be recognised immediately in the Statement of Comprehensive Income.
Property, plant and equipment
i.
Property, plant and equipment are stated at cost less accumulated depreciation. Cost represents the cost of
acquisition or construction, including the direct cost of financing the acquisition or construction until the
asset comes into use. Depreciation is provided to write off the cost or valuation of property, plant and
equipment less the estimated residual value by equal instalments over their estimated useful economic lives
as follows:
Buildings Over the remaining life of the lease on the land on which the building is
constructed
Tenant improvements Over the remaining life of the lease of the relevant building
Equipment 7% – 50% per annum
Motor vehicles 20% per annum
The expected useful lives and residual values of property, plant and equipment are reviewed on an annual
basis and, if necessary, changes in useful life or residual value are accounted for prospectively.
The carrying value of property, plant and equipment is reviewed for impairment whenever events or changes
in circumstances indicate the carrying value may not be recoverable.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits
are expected to arise from the continued use of the asset. Any gain or loss arising on derecognition of the
asset (calculated as the difference between the net disposal proceeds and the carrying amount of the item) is
included in the Statement of Comprehensive Income in the period the item is derecognised.
IFRS 5 sets out the criteria for designating an asset as held for sale:
l Management must be committed to a plan to sell the asset;
l
l
l
l
An active program to find a buyer must have been initiated;
The asset must be actively marketed for sale at a price reasonable to its current fair value;
The sale is expected to be completed within 1 year from the date of classification;
Significant changes to the plan are unlikely.
Should the above criteria be met the asset, or group of assets, is reclassified to current assets, at the lower of
its carrying amount and its fair value less costs to sell.
Cash and cash equivalents
j.
Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on
demand form an integral part of the Group’s cash management and are included as a component of cash and
cash equivalents for the purpose of the statement of cash flows.
57
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
1.
Summary of significant accounting policies (continued)
Foreign currencies
k.
Transactions in foreign currencies are recorded using the rate of exchange ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are translated using the rate of exchange
ruling at the statement of financial position date and the gains or losses on translation are included in the
Statement of Comprehensive Income. The functional currency of the Group is pounds sterling.
Leases
l.
Operating lease rentals are charged to the Statement of Comprehensive Income on a straightline basis over
the period of the lease.
A lessee will be required to recognise assets and liabilities for all leases with a term of more than 12 months
(unless the underlying asset is of low value) and is required to present depreciation of leased assets separately
from interest on lease liabilities in the consolidated statement of comprehensive income.
The right of use asset is initially measured at cost, and is subsequently measured at cost less accumulated
depreciation and impairment, and adjusted for any amendment to the lease liability. The lease liability is
initially measured at the present value of the lease payments due at inception, and is subsequently adjusted
for lease payments and interest, or any amendment to the lease liability.
The Group has taken the exemptions where applicable for low value and shortterm leases. A lessor will
continue to classify its leases as operating leases or financing leases, and to account for those two types of
leases separately.
Inventory
m.
Inventory is stated at the lower of cost and net realisable value. Cost is determined on a first in first out basis
and includes all direct costs incurred and attributable production overheads. Net realisable value is based on
estimated selling price allowing for all further costs to completion and disposal.
Pensions
n.
The Group offers a contributory Group stakeholder pension scheme, into which the Group will make matching
contributions up to a preagreed level of base salary; the scheme is open to executive directors and permanent
employees. Directors may choose to have contributions paid into personal pension plans. Payments to the
defined contribution retirement benefit plans are recognised as an expense when the employees have rendered
service entitling them to contributions.
Dividends
o.
Dividends are recognised when they become legally payable. In the case of interim dividends to equity
shareholders, this is when they are paid. In the case of final dividends, this is when approved by the shareholders
at the AGM. Dividends unpaid at the statement of financial position date are only recognised as a liability at
that date to the extent that they are appropriately authorised and are no longer at the discretion of the Company.
Unpaid dividends that do not meet these criteria are disclosed in the notes to the financial statements.
Classification of financial instruments issued by the Group
p.
In accordance with IAS 32, financial instruments issued by the Group are treated as equity (i.e. forming part
of shareholders’ funds) only to the extent that they meet the following two conditions:
(a)
they include no contractual obligations upon the Company (or Group as the case may be) to deliver
cash or other financial assets or to exchange financial assets or financial liabilities with another party
under conditions that are potentially unfavourable to the Company (or Group); and
(b) where the instrument will or may be settled in the Company’s own equity instruments, it is either
a nonderivative that includes no obligation to deliver a variable number of the Company’s own equity
instruments or is a derivative that will be settled by the Company exchanging a fixed amount of cash or
other financial assets for a fixed number of its own equity instruments.
Plexus Holdings plc Annual Report 2022
58
Notes to the Consolidated Financial Statements continued
1.
Summary of significant accounting policies (continued)
To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. Where
the instrument so classified takes the legal form of the Company’s own shares, the amounts presented in these
financial statements for called up share capital and share premium account exclude amounts in relation to
those shares.
Finance payments associated with financial liabilities are dealt with as part of finance charges. Finance
payments associated with financial instruments that are classified as part of shareholders’ funds (see dividends
policy), are dealt with as appropriations in the reconciliation of movements in shareholders’ funds.
Share based payments
q.
The Group issues share options to directors and employees, which are measured at fair value at the date of
grant. The fair value of the equity settled options determined at the grant date is expensed on a straightline
basis over the vesting period based on an estimate of the number of options that will actually vest. The Group
has adopted a Stochastic model to calculate the fair value of options, which enables the Total Shareholder
Return (TSR) performance condition attached to the awards to be factored into the fair value calculation.
Management of capital
r.
The Group’s capital is comprised of share capital, shares held in treasury and retained earnings. (notes 21
and 22).
The Group’s objective when managing capital is to safeguard its ability to continue as a going concern so
that it can continue to provide returns to shareholders.
The Group sets the amount of capital in proportion to its assessment of the risks that it faces. The Group
manages the capital structure and adjusts it in the light of changes in economic conditions and the risk
characteristics of the underlying assets. In order to maintain or adjust the capital structure the Group may
adjust the value of dividends paid or issue new equity.
Significant judgements made by management
s.
Estimates and judgements are continually evaluated and are based on historical experience and other factors,
including expectations of future events that are believed to be reasonable under the circumstances.
The principal areas in which significant judgements have been made by management are as follows:
(a)
In assessing the intangibles assets for impairment, the directors have prepared projections of future
revenues expected to be derived from exploiting the Group’s intangible assets in future periods as part
of their consideration of impairment. The core technology has proven commercial value, despite the
recent trading losses made. The projections for future application are subject to a significant degree of
judgement.
(b) The directors have considered the recognition of a deferred tax asset in relation to future utilisation of
trading losses. That recognition is predicated on a judgement in relation to the probable extent that
sufficient taxable profit will be available against which the unused tax losses can be utilised. In arriving
at that judgement, the directors have adopted modelling based on approved budgets for the next
12 months, and modelling for an additional two years, and applied estimates and assumptions consistent
with those set out in note 12 in relation to expectation of future developments, sales models and
growth rates.
(c)
Included within administrative expenses is an impairment charge of £109k relating to the Group’s
investment in an associate undertaking. A profit before tax multiple model has been used to revalue the
investment.
59
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
1.
Summary of significant accounting policies (continued)
t.
Key assumptions and sources of estimation
Judgements
The life of the Group’s Intellectual Property is estimated with reference to the lifespan of the patents which
help protect the knowledge and the Group’s ability to generate income from it. Changes to these estimates
can result in significant variations in the carrying value and amounts charged to the consolidated statement
of comprehensive income in specific periods.
When measuring goodwill and intangible assets for impairment a range of assumptions are required and these
are detailed in the Goodwill and Intangible Asset notes 1g and 1h. When reviewing the Intellectual Property
(“IP”) for impairment a multi scenario model is employed which includes an organic sales model and a
licensing model for the two main stands of IP, Conventional and Deepwater. A number of assumptions and
judgements are used in the modelling, including assumed growth rates, cost inflation and salary inflation.
A sensitivity analysis is applied to the modelling including flexing the weight average cost of capital and
revenue growth rate. In all scenarios the discounted cash flows are in excess of the carrying values of the IP.
Estimates
Provisions requiring management estimates and judgements: A provision has been made against slow moving
inventory based upon historical experience of the viability of the older parts as technological improvements
are made. Changes to these estimates can result in significant variations in the carrying value and amounts
charged to the consolidated statement of comprehensive income in specific periods.
In forming their assessment of going concern, the Directors prepare budgets and forecasts, which include
multiscenario modelling. The main area of estimation within the modelling is revenue levels. The Directors
estimate revenues based on their current expectation from contracted works and other projects considered very
likely to proceed. These are sensitised for more severe scenarios, to ensure that the Group has enough cash
headroom to ensure the goingconcern assumption is appropriate. Refer to going concern disclosure at note 1b.
2.
Revenue
By geographical area
UK
Europe
Rest of World
The revenue information above is based on the location of the customer.
By revenue stream
Rental
Service
Sold Equipment
Royalty Fees
Rebillables
Support services and Engineering
2022
£’000
1,984
277
45
–––––
2,306
–––––
2022
£’000
417
167
1,289
277
24
132
–––––
2,306
–––––
2021
£’000
1,992
–
25
–––––
2,017
–––––
2021
£’000
401
235
835
386
19
141
–––––
2,017
–––––
Substantially all of the revenue in the current and previous periods derives from the sale, rental and the
provision of services relating to the Group’s patent protected equipment.
Plexus Holdings plc Annual Report 2022
60
Notes to the Consolidated Financial Statements continued
3.
Segment Reporting
The Group derives revenue from the sale of its POSGRIP technology and associated products, the rental of
equipment utilising the POSGRIP technology and service income principally derived in assisting with the
commissioning and ongoing service requirements of our equipment. These income streams are all derived
from the utilisation of the technology which the Group believes is its only segment.
Per IFRS 8, the operating segment is based on internal reports about components of the group, which are
regularly reviewed and used by the board of directors being the Chief Operating Decision Maker (“CODM”).
All of the Group’s noncurrent assets are held in the UK.
The following customers each account for more than 10% of the Group’s continuing revenue:
Customer 1
Customer 2
Customer 3
2022
£’000
1,471
277
–
2021
£’000
1,485
–
386
4. Group operating loss
Loss on ordinary continuing activities before tax taxation is stated after charging/(crediting).
Depreciation of tangible assets
Amortisation of intangible assets:
– Intellectual property rights
– Research and development
– Computer software
– IFRS 16 lease amortisation
Operating lease charges:
– Land and buildings
– Other
Foreign currency exchange loss
Gain on disposal of property, plant and equipment
Directors’ emoluments
Inventories recognised as expense
Inventory write down provision
Auditors’ remuneration:
Fees payable to the Company’s auditors for:
The audit of the Company’s annual accounts
The audit of the Company’s subsidiary pursuant to legislation
Audit related assurance services
Total audit fees
2022
£’000
2021
£’000
449
238
687
1
304
17
48
15
4
644
598
–
10
30
3
–––––
43
–––––
482
237
676
3
303
17
47
17
1
693
319
569
10
30
3
–––––
43
–––––
61
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
5.
Staff numbers and costs
The average number of persons, including executive directors, during the year was:
Management
Technical
Administrative
The aggregate payroll costs of these persons were as follows:
Wages and salaries
Social security costs
Pension contributions to defined contribution plans
2022
Number
6
26
6
–––––
38
–––––
2022
£’000
2,509
239
115
–––––
2,863
–––––
2021
Number
6
25
5
–––––
36
–––––
2021
£’000
2,466
231
111
–––––
2,808
–––––
Key management are considered to be the Board of Directors and details of Directors’ remuneration are given
in the remuneration report on page 40 and this forms part of the financial statements.
Other income includes Job Retention Scheme income of £11k (2021: £87k).
6.
Finance Income
Bank interest receivable
Investment income
Other interest receivable
7.
Finance Costs
On bank loans and overdraft
Investment costs
Fair value adjustment on financial assets
Interest on right of use assets
Plexus Holdings plc Annual Report 2022
62
2022
£’000
19
143
2
–––––
164
–––––
2022
£’000
29
67
513
31
–––––
640
–––––
2021
£’000
24
109
10
–––––
143
–––––
2021
£’000
8
37
19
39
–––––
103
–––––
Notes to the Consolidated Financial Statements continued
8.
Income tax credit
(i) The taxation charge for the year comprises:
UK Corporation tax:
Adjustment in respect of prior years
Foreign tax
Current tax on income for the year
Adjustment in respect of prior years
Total current tax charge/(credit)
Deferred tax:
Origination and reversal of timing differences
Adjustment in respect of prior years
Total deferred tax
Total tax (credit)/charge
The effective rate of tax is 19% (2021: 19%)
Tax charge on discontinued activities
Tax credit on continuing activities
Total tax (credit)/charge
(ii) Factors affecting the tax charge on continuing activities for the year
Loss on ordinary activities before tax
Tax on (loss)/profit at standard rate of UK
corporation tax of 19% (2021: 19%)
Effects of:
Expenses not deductible for tax purposes
Effect of change in tax rate
Tax adjustments on sharebased payments
Adjustments in respect of prior year
Foreign tax rates
Deferred tax not recognised
Total tax credit on continuing activities
2022
£’000
–
–––––
–
–––––
2
–
–––––
2
–––––
2
–––––
(14)
(23)
–––––
(37)
–––––
(35)
–––––
–
(35)
–––––
(35)
–––––
2022
£’000
(5,784)
(1,098)
282
(257)
(22)
–
1,060
–––––
(35)
–––––
2021
£’000
(83)
–––––
(83)
–––––
1
–
–––––
1
–––––
(82)
–––––
(23)
255
–––––
(232)
–––––
150
–––––
412
(262)
–––––
150
–––––
2021
£’000
(4,372)
(831)
186
(816)
(92)
1,291
–––––
(262)
–––––
63
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
8.
Income tax credit (continued)
(iii) Movement in deferred tax asset balance
Deferred tax asset at beginning of year
Debit to Statement of Comprehensive Income
Deferred asset at end of year
(iv) Deferred tax asset balance
The deferred tax asset balance is made up of the following items:
Difference between depreciation and capital allowances
Tax provisions
Tax losses
Deferred tax asset at end of year
2022
£’000
(1,899)
1,899
–––––
–
–––––
2022
£’000
–
–
–––––
–
–––––
2021
£’000
(2,130)
231
–––––
(1,899)
–––––
2021
£’000
1,131
(1)
(3,029)
–––––
(1,899)
–––––
As outlined in the accounting policy (note 1f) deferred tax assets are recognised only to the extent that it is
probable that future taxable profit will be available. The deferred tax asset relates to losses and is reviewed
at the end of each reporting period. The Group has previously recognised a deferred tax asset based upon its
midterm forecast profitability. On the basis losses have not been utilised in the current financial year
management consider that the probable threshold is not met and have released the asset to the extent there
are not sufficient taxable temporary differences. Once this threshold can be demonstrated an asset will be
recognised. At 30 June 2022 the Group has tax losses available of £21.5m and have not recognised a potential
deferred tax asset in relation to these of £4.29m.
9.
Discontinued Operations
On 1st February 2018 the Group sold its “Jackup Business” to TFMC for an initial gross consideration of
£15m, with an additional sum of up to £27.5m payable dependent on the future performance of the Jackup
Business during a three year earnout period.
The recognised profit on discontinued operations in the prior year represented an increase in the expected
deferred consideration received.
Revenue
Expenses
Gain/(loss) before tax of discontinued operations
Income tax charge
Loss after tax of discontinued operations
Loss after taxation from discontinued operations
2022
£’000
–
–
–
–
–
–––––
–
–––––
The Statement of cash flows includes the following amounts related to discontinued operations:
Operating activities
Investing activities
Financing activities
Net cash generated/(used) from discontinued activities
Plexus Holdings plc Annual Report 2022
64
2022
£’000
–
–
–
–––––
–
–––––
2021
£’000
–
20
20
(412)
(392)
–––––
(392)
–––––
2021
£’000
–
–
–
–––––
–
–––––
Notes to the Consolidated Financial Statements continued
10. Loss per share
Loss attributable to shareholders – continuing operations
Loss attributable to shareholders – discontinued operations
Loss attributable to shareholders
Weighted average number of shares in issue
Dilution effects of share schemes
Diluted weighted average number of shares in issue
Loss per share
Basic Loss per share for continuing operations
Diluted Loss per share for continuing operations
Basic Loss per share for discontinued operations
Diluted loss per share for discontinued operations
2022
£’000
2021
£’000
(7,457)
–
––––––––––
(7,457)
––––––––––
(4,110)
(392)
––––––––––
(4,502)
––––––––––
Number
Number
100,435,744
–
––––––––––
100,435,744
––––––––––
(7.42p)
(7.42p)
––––––––––
–
–
––––––––––
100,435,744
–
––––––––––
100,435,744
––––––––––
(4.09p)
(4.09p)
––––––––––
(0.39p)
(0.39p)
––––––––––
Basic loss per share is calculated on the results attributable to ordinary shares divided by the weighted average
number of shares in issue during the year.
Diluted earnings per share calculations include additional shares to reflect the dilutive effect of share option
schemes. As a loss was made on continuing operations for the current year the option schemes are considered
to be antidilutive.
11. Goodwill
Cost
As at 30 June 2020, 2021 and 2022
Impairment
As at 1 July 2020, 2021 and 2022
Net Book Value
As at 30 June 2021 and 2022
£’000
767
––––––
–
––––––
767
––––––
The recoverable amount of goodwill has been determined on a value in use basis.
The key assumptions on which the valuation is based are that:
l
l
Industry acceptance will over time result in growth of the business above longterm industry growth rates.
Management considers this to be appropriate for a new technology still gaining industry acceptance,
Prices will rise with inflation,
These assumptions were determined from the directors’ knowledge and experience.
65
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
11. Goodwill (continued)
The cash flows are based upon a 20year period which is the period covered by the relevant patents, and, in
accordance with historical trends and current expectations. In making these calculations Management have not
included an assessment of the terminal value. The Company’s Weighted Average Cost of Capital for discounting
purposes has been measured at 10.87%. A discounted cashflow model has been prepared for both an organic
sales model and a licensing sales model. The cashflows are based upon approved budgets for the following
12 months, beyond this they are based upon management’s expectations of future developments. As the Group
are starting from a base point of trading the growth rates are high in the initial years (varying from 50% to
400% depending on the model employed), then in later years where the technology becomes established the
expected rate of growth declines (varying from 5% to 10% depending on the model employed).
To scrutinise the model a sensitivity analysis has been conducted on the WACC and the revenue growth rates
which has not highlighted impairment of the intangible assets is required. Management regularly assesses the
sensitivity of the key assumptions and the probability that any of them would change to the degree that the
carrying value would exceed the recoverable amount. It would require significant adjustments to key
assumptions before the goodwill would be impaired
Note 1g provides information on the Goodwill.
12.
Intangible Assets
Cost
As at 30 June 2020
Additions
Disposals
As at 30 June 2021
Additions
Disposals
As at 30 June 2022
Amortisation
As at 30 June 2020
Charge for the year
On disposals
As at 30 June 2021
Charge for the year
On disposals
As at 30 June 2022
Net Book Value
As at 30 June 2022
As at 30 June 2021
Intellectual
Property
£’000
Patent and
Other
Development
£’000
Computer
Software
£’000
4,600
–
–
––––––––––
4,600
–
–
––––––––––
4,600
––––––––––
3,313
237
–
––––––––––
3,550
238
–
––––––––––
3,788
––––––––––
812
––––––––––
1,050
––––––––––
13,455
235
–
––––––––––
13,690
447
–
––––––––––
14,137
––––––––––
4,422
676
–
––––––––––
5,098
687
–
––––––––––
5,785
––––––––––
8,352
––––––––––
8,592
––––––––––
261
–
–
––––––––––
261
–
(17)
––––––––––
244
––––––––––
256
3
–
––––––––––
259
1
(17)
––––––––––
243
––––––––––
1
––––––––––
2
––––––––––
Total
£’000
18,316
235
–
––––––––––
18,551
447
(17)
––––––––––
18,981
––––––––––
7,991
916
–
––––––––––
8,907
926
(17)
––––––––––
9,816
––––––––––
9,165
––––––––––
9,644
––––––––––
Plexus Holdings plc Annual Report 2022
66
Notes to the Consolidated Financial Statements continued
12.
Intangible Assets (continued)
When assessing the valuation of the Group’s assets the key assumptions on which the valuation is based
are that:
l
l
l
Industry acceptance will result in continued growth of the business above longterm industry growth rates
Management considers this to be appropriate for a new technology gaining industry acceptance,
Prices will rise with inflation,
Costs, in particular direct costs and staff costs are based on past experiences, and management’s knowledge
of the industry,
These assumptions were determined from the directors’ knowledge and experience.
The value in use calculation is based on cash flow forecasts derived from the most recent financial model
information available. Although the Group’s technology is proven and has proven commercial value the
exploitation of opportunities beyond the rental wellhead exploration equipment services market are at a
relatively early stage and the commercialisation process is expected to be a long term one. The cash flow
forecasts therefore extend to 2042 to ensure the full benefit of all current projects is realised. The rationale
for using a timescale up to 2042 with growth projections which increase in the first five years and decline
thereafter, is that as time progresses, Plexus expects to gain an increasing foothold in the surface, subsea and
other equipment markets, including the recent reentry into the Jackup exploration rental wellhead sector.
As the Group is starting from a base point of trading the growth rates are expected to be high in the initial
years (varying from 50% to 400% depending on the model employed) then in later years where the technology
becomes established the expected rate of growth declines (varying from 5% to 10 depending on the model
employed).
The key assumptions used in these calculations include discount rate, revenue projections, growth rates,
expected gross margins and the lifespan of the Group’s technology.
Management estimates the discount rates using pretax rates that reflect current market assessments of the
time value of money and risks specific to the Group and the markets in which it operates. Revenue projections,
growth rates, margins and technology lifespans are all estimated based on the latest business models and the
most recent discussions with customers, suppliers and other business partners.
Management regularly assesses the sensitivity of the key assumptions, including a sensitivity analysis, and
the probability that any of them would change to the degree that the carrying value would exceed the
recoverable amount. It would require significant adjustments to key assumptions before the goodwill and
other intangibles would be impaired.
Patent and other development costs are internally generated Note 1h provides additional information on
intangible assets.
67
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
13.
Investments
Included within the consolidated Group accounts are the following subsidiaries and associated undertakings:
Country of Registration Nature of Business
Percentage of Ordinary
Shares held
Subsidiary/Associated
undertaking
Plexus Ocean Systems
Limited
Plexus Limited
Plexus Applied
Technologies Limited
Plexus Holdings
USA Inc.
Plexus Ocean Systems
US. LLC
Plexus Deepwater
Technologies Limited
Plexus Response
Services Limited
Plexus Subsea
International Limited
Plexus Ocean Systems
(Malaysia) Sdn Bhd
Scotland
Scotland
Scotland
USA
USA
USA
Turks and
Caicos Islands
Turks and
Caicos Islands
Malaysia
Plexus Ocean Systems
(Brunei) Sdn Bhd
Brunei
Plexus Offshore Systems
(Singapore) Pte Ltd
Singapore
Turks and
Caicos Islands
Scotland
Afrotel Corporation Ltd
Kincardine
Manufacturing Services
Limited
Plexus Pressure Control
Limited
Supply of wellheads
and associated
equipment for
oil and gas drilling
Dormant
Dormant
Investment Holding
Investment Holding
Dormant
Dormant
Commercial exploitation
of subsea applications
Supply of wellheads and
associated equipment for
oil and gas drilling
Supply of wellheads and
associated equipment for
oil and gas drilling
Supply of wellheads and
associated equipment for
oil and gas drilling
Dormant
Manufacture and machining
of fabricated metal products
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
49%
100%
Scotland
Dormant
The Group’s investments are unlisted.
Plexus Holdings plc Annual Report 2022
68
Notes to the Consolidated Financial Statements continued
14.
Investment in associate
Investment in associate at 30 June 2020
Share of loss for the period
Dividends received
Investment in associate at 30 June 2021
Share of profit for the period
Impairment of investment
Investment in associate at 30 June 2022
£’000
898
(77)
(100)
––––––––––
721
––––––––––
111
(109)
––––––––––
723
––––––––––
On 14 December 2018 Plexus Ocean Systems Limited acquired a 49% interest in Kincardine Manufacturing
Services Limited (“KMS”) for a consideration of £735k plus associated legal fees. KMS are a precision
engineering company which serves the oil and gas industry. This is viewed as a longterm strategic investment
by Plexus. KMS are based at Sky House, Spurryhillock Industrial Estate, Stonehaven, Aberdeenshire AB39 2NH
Following the investment Graham Stevens PLC Finance Director was appointed to the board of KMS.
The company remains under the control and influence of the 51% majority shareholders.
On 30 June 2022, an impairment review has been undertaken. The investment has been revalued using a profit
after tax earnings model. This has resulted in an impairment charge of £109k.
The summary financial information of KMS, extracted on a 100% basis from the accounts for the 6 months to
30 June 2022 are as follows:
Noncurrent assets
Current assets
Current liabilities
Noncurrent liabilities
Revenue
(Loss) / profit before tax
2022
£’000
846
1,951
844
836
3,473
(196)
2021
£’000
1,066
1,822
787
1,211
3,313
(194)
KMS have a December 31 yearend date. Therefore, the profit before tax figure is based on management
accounts for the 12month period to 30 June 2022.
69
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
15. Property plant and equipment
Assets under
Buildings Improvements Equipment Construction
£’000
Tenant
£’000
£’000
£’000
Motor
Vehicles
£’000
Total
£’000
Cost
As at 30 June 2020
Additions
Transfers
Disposals
As at 30 June 2021
Additions
Transfers
Reclassified to assets
held for sale
Disposals
As at 30 June 2022
Depreciation
As at 30 June 2020
Charge for the year
On disposals
As at 30 June 2021
Charge for the year
Reclassified to assets
held for sale
On disposals
As at 30 June 2022
Net book value
As at 30 June 2022
As at 30 June 2021
3,740
–
–
–
––––––––––
3,740
–
–
(3,055)
–
––––––––––
685
––––––––––
1,490
153
–
––––––––––
1,643
153
(1,111)
–
––––––––––
685
––––––––––
–
––––––––––
2,097
––––––––––
714
–
–
–
––––––––––
714
130
–
–
–
––––––––––
844
––––––––––
525
41
–
––––––––––
566
40
–
–
––––––––––
606
––––––––––
238
––––––––––
148
––––––––––
5,393
42
128
(2)
––––––––––
5,561
69
54
(3)
(321)
––––––––––
5,360
––––––––––
4,569
284
(2)
––––––––––
4,851
252
(3)
(321)
––––––––––
4,779
––––––––––
581
––––––––––
710
––––––––––
–
128
(128)
–
––––––––––
–
54
(54)
–
–
––––––––––
–
––––––––––
–
–
–
––––––––––
–
–
–
–
––––––––––
–
––––––––––
–
––––––––––
–
––––––––––
17
–
–
–
––––––––––
17
–
–
–
–
––––––––––
17
––––––––––
7
4
–
––––––––––
11
4
–
–
––––––––––
15
––––––––––
2
––––––––––
6
––––––––––
9,864
170
–
(2)
––––––––––
10,032
253
–
(3,058)
(321)
––––––––––
6,906
––––––––––
6,591
482
(2)
––––––––––
7,071
449
(1,114)
(321)
––––––––––
6,085
––––––––––
821
––––––––––
2,961
––––––––––
The value in use of property, plant and equipment is not materially different from the carrying value.
Plexus Holdings plc Annual Report 2022
70
Notes to the Consolidated Financial Statements continued
16. Asset held for sale
Cost
Accumulated depreciation
Net book value
Preparation costs
Cost of sale
Fair value adjustment
2022
£’000
3,058
(1,114)
––––––––––
1,944
172
9
––––––––––
(1,025)
––––––––––
1,100
––––––––––
2021
£’000
–
–
––––––––––
–
–
–
––––––––––
–
––––––––––
–
––––––––––
The asset held for sale relates to a property that will be sold during the financial year ended 30 June 2023.
The Group has agreed a sale in principle prior to the year end, with the building having been previously
marketed for sale. In line with IFRS5 the asset is held for sale at the lower of its carrying value and fair value.
A fair value adjustment to reduce the carrying value of the asset to its fair value has been recognised as shown
above. The fair value was assessed by reference to an independent property agent.
17. Financial Assets
Financial instruments held at fair value
2022
£’000
101
––––––––––
101
––––––––––
2021
£’000
3,042
––––––––––
3,042
––––––––––
The financial asset relates to cash invested in an investment portfolio, made up of highyield bonds held at
fair value in the statement of financial position. The portfolio can be divested to cash at any time. Included
in the statement of comprehensive income is a writedown in the carrying value of the financial asset of £513k
(2021: £19k). The fair value of the investment is evaluated by reviewing the portfolio on a quarterly basis,
including the reporting date of 30 June 2022.
18.
Inventories
Raw materials and consumables
Finished goods and goods for resale
2022
£’000
662
732
––––––––––
1,394
––––––––––
2021
£’000
91
484
––––––––––
575
––––––––––
71
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
19. Trade and other receivables
Trade receivables
Prepayments and other amounts
2022
£’000
336
635
––––––––––
971
––––––––––
2021
£’000
772
279
––––––––––
1,051
––––––––––
Trade and other receivables are classified as loans and receivables and are held at amortised cost. The carrying
value approximates fair value.
20. Trade and other payables
Trade payables
Social security and other taxes
Other payables and accruals
21. Share Capital
Authorised:
Equity: 110,000,000 (2021: 110,000,000) Ordinary shares of 1p each
Allotted, called up and fully paid:
Equity: 105,386,239 (2021: 105,386,239) Ordinary shares of 1p each
22. Shares held in treasury
Buyback of shares
2022
£’000
724
90
431
––––––––––
1,245
––––––––––
2021
£’000
136
81
426
––––––––––
643
––––––––––
2022
£’000
2021
£’000
1,100
––––––––––
1,054
––––––––––
2022
£’000
2,500
––––––––––
1,100
––––––––––
1,054
––––––––––
2021
£’000
2,500
––––––––––
On 1 February 2019 Plexus Holdings PLC completed the acquisition of 4,950,495 Ordinary Shares
beneficially held by LLC Gusar. Following the above transaction, the Company’s issued share capital
comprises 105,386,239 Ordinary Shares, of which 4,950,495 Ordinary Shares are held in treasury. The
Company now has a total of 100,435,744 Ordinary Shares in issue with voting rights. This figure, 100,435,744,
should be used by shareholders as the denominator when determining whether they are required to notify
their interest in, or a change to their interest in the Company under the Financial Conduct Authority’s
Disclosure Guidance and Transparency Rules.
Plexus Holdings plc Annual Report 2022
72
Notes to the Consolidated Financial Statements continued
23. Share based payments
Share options have been granted to subscribe for ordinary shares, which are exercisable between 2021 and
2031 at prices ranging from £0.385 to £1.18. At 30 June 2022 there were 3,577,899 options outstanding.
The Company has an unapproved share option scheme for the directors and employees of the Group. Options
are exercisable at the quoted midmarket price of the Company’s shares on the date of grant. The options may
vest in three equal portions, at the end of each of three assessment periods, provided that the option holder is
still employed by the Group at vesting date and that the Total Shareholder Return (TSR) performance
conditions are satisfied. Options that do not meet the TSR criteria at the first available vesting date may vest
at the end of the complete assessment period, provided that the compounded TSR performance is met over
the complete assessment period. Vested but unexercised options ordinarily expire on the tenth anniversary of
the date of grant. The options are equity settled.
On 9 July 2015 the directors approved an amendment to the rules of the scheme such that the Company is
permitted to extend the exercise period for options granted under the scheme by a further ten years.
Subsequently on 8 June 2017, 13 December 2019 and 25 March 2021 the Company entered into deeds of
amendment with Ben van Bilderbeek, Graham Stevens, Craig Hendrie, and eleven employees in respect of
options granted to them on 20 June 2007 and 17 December 2009 and 25 March 2011 under the scheme, to
extend the exercise period by ten years, subject to all other terms of the scheme rules.
Details of the share options outstanding during the year are as follows:
Outstanding at the beginning of the period
Outstanding at the end of the period
Exercisable at the end of the period
2022
2021
Weighted
Average
Exercise
Price
No of
shares
0.52
0.52
0.52
3,577,899
3,577,899
3,577,899
Weighted
Average
Exercise
Price
0.53
0.52
0.52
No of
shares
3,577,899
3,577,899
3,577,899
The Group has recognised an expense in the current year of £nil (2021: £nil) towards equity settled sharebased
payments.
The weighted average contractual life of the share options outstanding at the end of the period is 6 years
3 months.
24. Reconciliation of net cash flow to movement in net cash/debt
Movement in cash and cash equivalents
Drawdown of Lombard facility
(Decrease) in net cash in year
Net cash at start of year
Net cash at end of year
2022
£’000
665
(1,914)
––––––––––
(1,249)
3,131
––––––––––
1,882
––––––––––
2021
£’000
1,088
(2,044)
––––––––––
(956)
4,087
––––––––––
3,131
––––––––––
73
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
25. Analysis of net cash/(debt)
2022:
Cash in hand and at bank
Bank Lombard facility
(3,958)
Lease Liability
(1,085)
Total
At beginning
of year
£’000
5,175
(2,044)
(1,401)
Cashflow
£’000
665
(1,914)
316
At end
of year
£’000
5,840
––––––––––
1,730
––––––––
––––––––––
(933)
––––––––
––––––––––
797
––––––––
A maturity analysis of the Bank Lombard Facility and Lease Liability are included in notes 26 and
27 respectively.
2021:
Cash in hand and at bank
Bank Lombard facility
(2,044)
Lease Liability
(1,401)
Total
At beginning
of year
£’000
4,087
–
Cashflow
£’000
1,088
(2,044)
(1,679)
278
At end
of year
£’000
5,175
––––––––––
2,408
––––––––
––––––––––
(678)
––––––––
––––––––––
1,730
––––––––
26. Financial Instruments and risk management
Treasury management
The Group’s activities give rise to a number of different financial risks: market risk (including foreign currency
exchange risk and interest rate risk), credit risk and liquidity risk. The Group’s management regularly monitors
the risks and potential exposures to which the Group is exposed and seeks to take action, where appropriate,
to minimise any potential adverse impact on the Group’s performance.
Risk management is carried out by Management in line with the Group’s Treasury policies. The Group’s
Treasury policies cover specific areas, such as foreign exchange risk, interest rate risk and investment of
excess cash. The Group’s policy does not permit entering into speculative trading of financial instruments
and this policy has been applied throughout the year.
(a) Market risks
(i)
Foreign currency exchange risk
The Group is exposed to foreign exchange risk arising from various currencies. In order to protect the
Group’s statement of financial position from movements in exchange rates, the Group converts foreign
currency balances into sterling on receipt so far as they will not be used for future payments in the
foreign currency.
The Group carefully monitors the economic and political situation in the countries in which it operates
to ensure appropriate action is taken to minimise any foreign currency exposure.
The Group’s main foreign exchange risk relates to movements in the sterling/US dollar and sterling/euro
exchange rates. Movements in these rates impact the translation of US dollar and euro denominated net
assets. Outstanding debts are in GBP and USD, minimal cash is held in foreign currency. Therefore, the
Group has minimal foreign exchange risk for the reporting period.
Plexus Holdings plc Annual Report 2022
74
Notes to the Consolidated Financial Statements continued
26. Financial Instruments and risk management (continued)
(ii)
Interest rate risk
The Group has historically financed its operations through a mixture of retained profits and bank
borrowings. The Group borrows in sterling at floating rates of interest.
The Group is also exposed to interest rate risk on cash held on deposit. The Group’s policy is to maximise
the return on cash deposits whilst ensuring that cash is deposited with a financial institution with a credit
rating of ‘AA’ or better.
The consolidated income statement would be affected by gain/loss £69k (2021: £49k) by a reasonably
possible 1 percentage point change down/up in LIBOR interest rates on a full year basis. Post yearend
the Lombard facility was repaid which significantly minimises interest rate risk.
(b) Credit risk
The Group’s credit risk primarily relates to its trade receivables. Responsibility for managing credit risks lies
with the Company’s management.
The Group applies the IFRS 9 simplified approach to measure expected credit losses for all trade receivables
and contract assets. To measure the expected credit losses, trade receivables and contract assets have been
grouped based on shared credit risk characteristics and the number of days past due. The expected loss rates
are based on payment profiles of sales and the corresponding historical credit losses experienced within this
period. The amount of expected credit losses is updated at each reporting date to reflect changes in credit risk
since initial recognition of the respective financial instrument.
The investment portfolio consists of funds invested in highyield bonds with reputable financial institutions.
The Company do not consider the investment portfolio presents a credit risk.
A customer evaluation is typically obtained from an appropriate credit rating agency. Where required,
appropriate trade finance instruments such as letters of credit, bonds, guarantees and credit insurance will be
used to manage credit risk.
The Group’s major customers are typically large companies which have strong credit ratings assigned by
international credit rating agencies. Where a customer does not have sufficiently strong credit ratings,
alternative forms of security such as the trade finance instruments referred to above may be obtained. The
Group’s customer base is concentrated on a few major companies. A bad debt provision of £277k has been
included in relation to LLC Gusar, which cannot currently be settled while current economic sanctions remain
in place.
Management review trade receivables across the Group based on receivable days’ calculations to assess
performance. There is significant management focus on receivables that are overdue. All receivables are with
large corporations with good credit history with which the entity has not experienced any recoverability issues
in the past. Individual trade receivables and contract assets are written off when management deem them not
to be collectible. No bad debt provision has been provided for within the accounts.
Amounts deposited with banks and other financial institutions also give rise to credit risk. This risk is managed
by limiting the aggregate amount of exposure to any such institution by reference to their rating and by regular
review of these ratings. The possibility of material loss in this way is considered unlikely.
75
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
26. Financial Instruments and risk management (continued)
The currency composition of trade receivables at the yearend was:
Sterling
U.S Dollar
The ageing of trade receivables at the yearend was:
Not past due
Past due 030 days
Past due 30+ days
Past due 120+ days
(c) Liquidity risk
2022
£’000
336
–
–––––––
336
–––––––
2022
£’000
333
3
–
–
–––––––
336
–––––––
2021
£’000
555
217
–––––––
772
–––––––
2021
£’000
772
–
–
–
–––––––
772
–––––––
The Group has historically financed its operations through equity financing and bank borrowings. The Group
has continued with its policy of ensuring that there are sufficient funds available to meet the expected funding
requirements of the Group’s operations and investment opportunities. The Group monitors its liquidity position
through cash flow forecasting. Based on the current outlook the Group has sufficient funding in place to meet
its future obligations.
30 June 2022
Cash and liquid resources
30 June 2021
Cash and liquid resources
– Sterling
– US Dollar
– Malaysian Ringgit
– Sterling
– US Dollar
– Malaysian Ringgit
Floating Non-interest
bearing
£’000
rates
£’000
Book and
fair value
£’000
5,241
–
–
––––––––––
5,241
––––––––––
4,738
–
–
––––––––––
4,738
––––––––––
596
–
3
––––––––––
599
––––––––––
431
4
2
––––––––––
437
––––––––––
5,837
–
3
––––––––––
5,840
––––––––––
5,169
4
2
––––––––––
5,175
––––––––––
Plexus Holdings plc Annual Report 2022
76
Notes to the Consolidated Financial Statements continued
26. Financial Instruments and risk management (continued)
At 30 June 2022 the Group had £5,840k of cash. The average rate of interest earned in the year is on a floating
rate basis and ranged between 0% and 1.25% on sterling deposits.
Cash is categorised as loans and receivables.
The Group has classified its financial instruments into the three levels prescribed under the accounting
standards. The definition of the levels is as follows.
Level 1: The fair value of financial instruments traded in active markets (such as publicly traded derivatives,
and trading and availableforsale securities) is based on quoted market prices at the end of the reporting period.
The quoted market price used for financial assets held by the Group is the current bid price. These instruments
are included in level 1.
Level 2: The fair value of financial instruments that are not traded in an active market (for example,
overthecounter derivatives) is determined using valuation techniques which maximise the use of observable
market data and rely as little as possible on entityspecific estimates. If all significant inputs required to fair
value an instrument are observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is
included in level 3. This is the case for unlisted equity securities.
Noncurrent assets (note 17) meet the level 1 criteria and have been recorded in the statement of financial
position at fair value. As at 30 June 2022 the fair value of the financial assets held by the Group are £101k
(2021: £3,042k).
The interest rate and currency profiles of the Group’s financial liabilities at 30 June 2022 are as follows:
30 June 2022
Bank Lombard facility – Sterling
30 June 2021
Bank Lombard facility – Sterling
30 June 2022
Bank Lombard facility – Sterling
Total
30 June 2021
Bank Lombard facility – Sterling
Total
Floating Non-interest
bearing
£’000
rates
£’000
Book and
fair value
£’000
3,958
––––––––––
–
––––––––––
3,958
––––––––––
2,044
––––––––––
–
––––––––––
2,044
––––––––––
Due
within
1 Year
£’000
Due
between
2–5 Years
£’000
3,958
––––––––––
3,958
––––––––––
2,044
––––––––––
2,044
––––––––––
–
––––––––––
–
––––––––––
–
––––––––––
–
––––––––––
Due
after
5 Years
£’000
–
––––––––––
–
––––––––––
–
––––––––––
–
––––––––––
Total
£’000
3,958
––––––––––
3,958
––––––––––
2,044
––––––––––
2,044
––––––––––
Bank borrowings are other financial liabilities which are measured at amortised cost. The carrying value
approximates fair value.
77
Plexus Holdings plc Annual Report 2022
Notes to the Consolidated Financial Statements continued
27. Leased Assets and Liabilities
Leased Assets
The Group’s leased assets relates to a building. Key movements relating to the lease balance is
presented below:
As at 30 June 2020
Amortisation charge
(303)
As at 30 June 2021
Amortisation charge
(304)
As at 30 June 2022
Leased Liabilities
The maturity of the lease liability is as follows
Less than one year
One to five years
Total lease liability
£’000
1,548
–––––––
1,245
–––––––
941
–––––––
2021
£’000
316
1,085
–––––––
1,401
–––––––
2022
£’000
324
761
–––––––
1,085
–––––––
The total interest expense on lease liabilities and the total cash outflow in the year to 30 June 2021 was £31k
and £347k respectively (2021: £39k and £342k).
The borrowing rate applied to the lease liability is 2.5%.
Other leases
The Group leases storage facilities, IT equipment and other workshop machinery with terms between 1 month
and 2 years. The Group considers these assets to be of low value or shortterm in nature. Therefore, no right
of use assets and lease liabilities are recognised on these leases.
Expenses recognised relating to shortterm leases and leases of low value for the year to June 2022 was £53k
and £11k respectively (2021: £53k and £11k).
The Group had a capital commitment of £nil as at 30 June 2022 (2021: £nil).
28. Contingent liabilities
The Group had no contingent liabilities as at 30 June 2022 (2021: £nil).
Plexus Holdings plc Annual Report 2022
78
Notes to the Consolidated Financial Statements continued
29. Related Party Transactions
Control
No one party owns a controlling interest in the Company.
Ultimate parent company
There is no ultimate parent company.
During the year the Group had the following transactions with related parties:
Purchase of goods and services from Other Related Parties
Payables to Other Related Parties
Repayables from Other Related Parties
Purchases from associate undertaking
2022
£’000
347
–
–
57
–––––––
2021
£’000
342
–
–
65
–––––––
Other related parties were @SIPP (Pension Trustees) Limited, OFM Holdings Limited and Plexus Properties
International Limited. The transactions related to accommodation, rent and related charges. @SIPP (Pension
Trustees) Limited are the trustees of Ben van Bilderbeek’s pension fund. OFM Holdings Limited is a trust of
which Ben van Bilderbeek’s family are beneficiaries. Plexus Properties International Limited is a company
under the control of the van Bilderbeek family.
All of these transactions were between either Plexus Ocean Systems Limited or Plexus Ocean Systems
International Limited and the relevant related party.
30. Subsequent Event
In October 2022 the Group raised £1,550,000 through the issue of Convertible Loan Notes (“CLNs”), which
will be used for working capital and to fund the Group’s activities as it seeks to capitalise on the increasing
pipeline of opportunities within its target markets.
31. General information
These financial statements are for Plexus Holdings plc and subsidiary undertakings. The Company is
registered, and domiciled, in England and Wales and incorporated under the Companies Act 2006. The nature
of the Company’s operations and its principal activities are set out in the strategic report on page 9 and the
directors’ report on page 20.
79
Plexus Holdings plc Annual Report 2022
Parent Company Statement of Financial Position
at 30 June 2022
Assets
Intangible assets
Receivables due from subsidiary undertakings
Investments
Total Non-current assets
Trade and other receivables
Cash at bank and in hand
Total current assets
Total Assets
Equity and Liabilities
Called up share capital
Shares held in treasury
Share based payments reserve
Retained earnings
Total equity attributable to equity holders of the company
Liabilities
Deferred tax liabilities
Total non-current liabilities
Trade and other payables
Total current liabilities
Total liabilities
Total Equity and Liabilities
Notes
4
7
5
7
10
9
6
8
2022
£’000
8,962
7,466
8,294
–––––––
24,722
–––––––
53
8
–––––––
61
–––––––
24,783
–––––––
1,054
(2,500)
326
25,383
–––––––
24,263
–––––––
358
–––––––
358
–––––––
162
–––––––
162
–––––––
520
–––––––
24,783
–––––––
2021
£’000
9,380
20,469
8,294
–––––––
38,143
–––––––
251
55
–––––––
306
–––––––
38,449
–––––––
1,054
(2,500)
326
38,910
–––––––
37,790
–––––––
489
–––––––
489
–––––––
170
–––––––
170
–––––––
659
–––––––
38,449
–––––––
As permitted by section 408 of the Companies Act 2006, the parent company’s Statement of Comprehensive Income
has not been included in these financial statements. The parent company’s loss after tax for the year was £13,527k
(2021: loss of £794k).
These financial statements were approved and authorised for issue by the board of directors on 24 November 2022
and were signed on its behalf by:
G Stevens
Director
C Hendrie
Director
Company Number: 03322928
Plexus Holdings plc Annual Report 2022
80
Parent Company Statement of Changes in Equity
for the year ended 30 June 2022
Balance as at 30 June 2020
Total comprehensive income
for the period
Balance as at 30 June 2021
Total comprehensive income
for the period
Balance as at 30 June 2022
Called
Up
Share
Capital
£’000
Shares
Held in
Treasury
£’000
Share
Based
Payments
Reserve
£’000
Retained
Earnings
£’000
Total
£’000
1,054
(2,500)
326
39,704
38,584
–
–––––––
1,054
–––––––
–
–––––––
1,054
–––––––
–
–––––––
(2,500)
–––––––
–
–––––––
(2,500)
–––––––
–
–––––––
326
–––––––
–
–––––––
326
–––––––
(794)
–––––––
38,910
–––––––
(13,527)
–––––––
25,383
–––––––
(794)
–––––––
37,790
–––––––
(13,527)
–––––––
24,263
–––––––
81
Plexus Holdings plc Annual Report 2022
Parent Company Statement of Cash Flows
at 30 June 2022
Notes
Cash flows from operating activities
Loss before taxation
Adjustments for:
Amortisation
Intercompany loan impairment
Investment income
Changes in working capital:
Decrease / (Increase) in trade and other receivables
Decrease in trade and other payables
Cash (used) / generated from operations activities
Income taxes refunded
Net cash (used) / generated from operations
Cash flows from investing activities
Purchase of intangible assets
Interest received
Net cash generated from investing activities
Net (decrease) / increase in cash and cash equivalents
Cash and cash equivalents at 1 July 2021
Cash and cash equivalents at 30 June 2022
10
2022
£’000
(13,658)
865
12,819
(530)
382
(8)
–––––––
(130)
–
–––––––
(130)
–––––––
(447)
530
–––––––
83
–––––––
(47)
55
–––––––
8
–––––––
2021
£’000
(611)
854
–
(423)
(1,095)
(29)
–––––––
(1,304)
159
–––––––
(1,145)
–––––––
(235)
422
–––––––
187
–––––––
(958)
1,013
–––––––
55
––––––
Plexus Holdings plc Annual Report 2022
82
Notes to the Parent Company Financial Statements
1.
Summary of significant accounting policies
The following accounting policies have been applied consistently in dealing with items which are considered
material in relation to the financial information.
Basis of preparation
a.
The Company’s financial statements have been prepared in accordance with UKadopted international
accounting standards and interpretations issued by the International Accounting Standards Board and are in
accordance with the Companies Act 2006.
There are a number of standards, amendments to standards, and interpretations which have been issued by
the IASB that are effective in future accounting. The Directors’ have assessed the impact of these standards
and do not expect any significant impact to the Company on their adoption.
The Company financial statements are presented in sterling and all values are rounded to the nearest thousand
pounds except where otherwise indicated.
The financial information has been prepared under the historical cost convention except where fair value
adjustments are required.
Income taxes and deferred taxation
b.
The income tax expense for the period comprises current and deferred tax. Tax is recognised in the income
statement, except to the extent that it relates to items recognised in other comprehensive income or directly
in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity,
respectively.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at
the reporting date in the countries where the Company and its subsidiaries operate and generate taxable
income. Management periodically evaluates positions taken in tax returns with respect to situations in which
applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis
of amounts expected to be paid to the tax authorities.
Deferred income tax is recognised on temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the consolidated financial statements.
Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted
by the reporting date and are expected to apply when the related deferred income tax asset is realised, or the
deferred income tax liability is settled.
Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will
be available against which the temporary differences can be utilised.
As set out in note 23 of the Group accounts, the Company operates a share option scheme. Where the market
price of the shares at the yearend exceeds the option price there is a potential tax deduction. This is treated
as a deferred tax asset. The portion of the expected future tax deduction which is less than or equal to the
associated cumulative IFRS2 charge is recognised in the income statement. The balance of the credit is
recognised directly in equity.
Intangible assets and amortisation
c.
Patents are recorded initially at cost and amortised on a straightline basis over 20 years which represents the
life of the patent. The Group operates a policy of continual patent enhancement in order that technology
enhancements and modifications are incorporated within the registered patent, thereby protecting the value
of technology advances for a full 20year period.
83
Plexus Holdings plc Annual Report 2022
Notes to the Parent Company Financial Statements continued
1.
Summary of significant accounting policies (continued)
Intellectual Property rights are initially recorded at cost and amortised over 20 years on a straightline basis.
The technology defined by the Intellectual Property is believed to be able to generate income streams for the
Group for many years; key Intellectual Property is protected by patents; the lowest common denominator in
terms of economic life of the intangible assets is the life of the original patents and therefore the life of the
Intellectual Property has been matched to the remaining life of the patents protecting it.
Development expenditure is capitalised in respect of development of patentable technology at cost including
an allocation of own time when such expenditure is incurred on separately identifiable technology and its
future recoverability can reasonably be regarded as assured. Any expenditure carried forward is amortised
on a straightline basis over its useful economic life, which the directors consider to be 20 years.
Amortisation is charged to the Administrative Expenses line of the Statement of Comprehensive Income.
Expenditure on research and development, which does not meet the capitalisation criteria, is written off to
the Statement of Comprehensive Income in the period in which it is incurred.
The carrying value of intangible assets is reviewed on an ongoing basis by the directors and, where
appropriate, provision is made for any impairment in value. It would require a substantial movement (over
100%) in the assumptions employed in valuations before there would be any impairment to intangible assets.
Potential impairment of intangible assets has been reviewed and is outlined in note 1h in the Group accounts,
with no impairment required.
Investments
d.
The investment in subsidiary undertakings is stated at cost less provision for impairment. Cost is the amount
of cash paid or the fair value of the consideration given to acquire the investment. Income from such
investments is recognised only to the extent that the Company receives distributions from accumulated profits
of the investee company arising after the date of acquisition.
Potential impairment of investments and the intangible assets each subsidiary undertaking holds has been
reviewed and is outlined in note 1h in the Group accounts, with no impairment required.
Cash and cash equivalents
e.
Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on
demand form an integral part of the Company’s cash management and are included as a component of cash
and cash equivalents for the purpose of the statement of cash flows.
Foreign currencies
f.
Transactions in foreign currencies are recorded using the rate of exchange ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are translated using the rate of exchange
ruling at the statement of financial position date and the gains or losses on translation are included in the
Statement of Comprehensive Income.
Pensions
g.
The Group offers a contributory Group stakeholder pension scheme, into which the Group will make matching
contributions up to a preagreed level of base salary; the scheme is open to executive directors and permanent
employees. Directors may choose to have contributions paid into personal pension plans.
Dividends
h.
Dividends are recognised when they become legally payable. In the case of interim dividends to equity
shareholders, this is when they are paid. In the case of final dividends, this is when approved by the shareholders
at the AGM. Dividends unpaid at the statement of financial position date are only recognised as a liability at
that date to the extent that they are appropriately authorised and are no longer at the discretion of the Company.
Unpaid dividends that do not meet these criteria are disclosed in the notes to the financial statements.
Plexus Holdings plc Annual Report 2022
84
Notes to the Parent Company Financial Statements continued
1.
Summary of significant accounting policies (continued)
Classification of financial instruments issued by the Group
i.
In accordance with IAS 32, financial instruments issued by the Group are treated as equity (i.e. forming part
of shareholders’ funds) only to the extent that they meet the following two conditions:
(a)
they include no contractual obligations upon the Company (or Group as the case may be) to deliver
cash or other financial assets or to exchange financial assets or financial liabilities with another party
under conditions that are potentially unfavourable to the Company (or Group); and
(b) where the instrument will or may be settled in the Company’s own equity instruments, it is either a
nonderivative that includes no obligation to deliver a variable number of the Company’s own equity
instruments or is a derivative that will be settled by the Company exchanging a fixed amount of cash or
other financial assets for a fixed number of its own equity instruments.
To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. Where the
instrument so classified takes the legal form of the Company’s own shares, the amounts presented in these financial
statements for called up share capital and share premium account exclude amounts in relation to those shares.
Finance payments associated with financial liabilities are dealt with as part of finance charges. Finance
payments associated with financial instruments that are classified as part of shareholders’ funds (see dividends
policy), are dealt with as appropriations in the reconciliation of movements in shareholders’ funds.
Share based payments
j.
The Company issues share options to directors and employees, which are measured at fair value at the date of
grant. The fair value of the equity settled options determined at the grant date is expensed on a straightline
basis over the vesting period based on an estimate of the number of options that will actually vest. The Group
has adopted a Stochastic model to calculate the fair value of options, which enables the Total Shareholder
Return (TSR) performance condition attached to the awards to be factored into the fair value calculation.
Key assumptions and sources of estimation
k.
The estimated life of the Company’s Intellectual Property is estimated with reference to the lifespan of the
patents which protect the knowledge and their forecast income generation.
When measuring Intellectual Property for impairment a range of assumptions are required and these are
detailed in the Intangible Assets note above.
The recoverability of loan between parent company and subsidiary is a key estimate. Recoverability is based
on future financial performance.
2.
Profit for the year
As permitted by section 408 of the Companies Act 2006, the parent company’s Statement of Comprehensive
Income has not been included in these financial statements. The parent company’s loss after tax for the year
was £13,527k (2021: loss of £794k). The Company had revenue of £277k for the financial year (2021: £386k).
3.
Staff numbers and costs
Management
2022
Number
3
–––––––
3
–––––––
2021
Number
3
–––––––
3
–––––––
85
Plexus Holdings plc Annual Report 2022
Notes to the Parent Company Financial Statements continued
3.
Staff numbers and costs (continued)
The aggregate payroll costs of these persons were as follows:
Wages and salaries
Social security costs
2022
£’000
183
25
–––––––
208
–––––––
2021
£’000
185
24
–––––––
209
–––––––
All payroll costs are of a continuing nature.
Key management are considered to be the Board of Directors and details of Directors’ remuneration are
given in the remuneration report on page 40 and this forms part of the financial statements.
4.
Intangible fixed assets
As at 30 June 2020
Additions
As at 30 June 2021
Additions
As at 30 June 2022
Amortisation
As at 30 June 2020
Charge for the year
As at 30 June 2021
Charge for the year
As at 30 June 2022
Net Book Value
As at 30 June 2022
As at 30 June 2021
Intellectual
Property
£’000
Patent and
Other
Development
£’000
2,761
–
–––––
2,761
–
–––––
2,761
–––––
1,797
178
–––––
1,975
178
–––––
2,153
–––––
608
–––––
786
–––––
13,226
235
–––––
13,461
447
–––––
13,908
–––––
4,191
676
–––––
4,867
687
–––––
5,554
–––––
8,354
–––––
8,594
–––––
Total
£’000
15,987
235
–––––
16,222
447
–––––
16,669
–––––
5,988
854
–––––
6,842
865
–––––
7,707
–––––
8,962
–––––
9,380
–––––
Plexus Holdings plc Annual Report 2022
86
Notes to the Parent Company Financial Statements continued
5.
Investments
Subsidiary undertakings:
As at 30 June 2020, 2021 and 2022
The Company’s undertakings are:
Subsidiary undertaking Country of Registration
Nature of Business
Address and
£’000
8,294
–––––
Percentage of
Ordinary
Shares held
100%
Plexus Ocean Systems
Limited
Plexus Limited
Plexus Applied
Technologies Limited
Johnstone House,
5254 Rose Street,
Aberdeen, AB10 1HA
Scotland
Johnstone House,
5254 Rose Street,
Aberdeen, AB10 1HA
Scotland
Highdown House,
Yeoman Way,
Worthing,
West Sussex, BN99 3HH
England
Supply of wellheads and
associated equipment for
oil and gas drilling
Dormant
100%
Dormant
100%
Plexus Holdings USA
Inc.
4295 San Felipe #1200,
Houston, TX 77027, USA
Investment Holding
Plexus Ocean Systems
US. LLC
4295 San Felipe #1200,
Houston, TX 77027, USA
Investment Holding
Plexus Deepwater
Technologies Limited
4295 San Felipe #1200,
Houston, TX 77027, USA
Dormant
Plexus Response
Services Limited
Plexus Subsea
International Limited
Plexus Ocean Systems
(Malaysia) Sdn Bhd
1, Caribbean Place,
P.O Box 97,
Leeward Highway,
Providenciales,
Turks and Caicos Islands
1, Caribbean Place,
P.O Box 97, Leeward
Highway, Providenciales,
Turks and Caicos Islands
Level 16, Tower C,
Megan Avenue II,
12, Jalan Yap Kwan Seng,
50450, Kuala Lumpur,
Malaysia
Commercial exploitation
of subsea applications
Commercial exploitation
of subsea applications
Supply of wellheads and
associated equipment for
oil and gas drilling
100%
100%
100%
100%
100%
100%
87
Plexus Holdings plc Annual Report 2022
Notes to the Parent Company Financial Statements continued
5.
Investments (continued)
Subsidiary undertaking Country of Registration
Nature of Business
Address and
Percentage of
Ordinary
Shares held
100%
Supply of wellheads and
associated equipment for
oil and gas drilling
Supply of wellheads and
associated equipment for
oil and gas drilling
100%
Investment Holding
100%
Design, fabrication and
manufacture of valve
related products
100%
2022
£’000
489
(131)
–––––––
358
–––––––
2022
£’000
1,470
(1,112)
–––––––
358
–––––––
2021
£’000
224
265
–––––––
489
–––––––
2021
£’000
1,601
–
(1,113)
–––––––
488
–––––––
Plexus Ocean Systems
(Brunei) Sdn Bhd
Plexus Offshore Systems
(Singapore) Pte Ltd
Afrotel Corporation Ltd
Plexus Pressure
Control Limited
Ground Floor Unit 30,
Block D Simpang 21,
Kg Menglait Gadong,
BE4119, Bandar,
Seri Begawan,
Brunei Darussalam
137 Telok Ayer Street,
0801, Singapore,
Singapore
1, Caribbean Place,
P.O Box 97, Leeward
Highway, Providenciales,
Turks and Caicos Islands
Johnstone House,
5254 Rose Street,
Aberdeen, AB10 1HA
Scotland
6.
Deferred tax
i) Movement in deferred tax liability balance
Deferred tax liability at beginning of year
(Credit) / debit to Statement of Comprehensive Income
Deferred liability at end of year
ii) Deferred tax liability balance
The deferred tax liability balance is made up of the following items:
Difference between depreciation and capital allowances
Share based payments
Tax losses
Deferred tax liability at end of year
Plexus Holdings plc Annual Report 2022
88
Notes to the Parent Company Financial Statements continued
7.
Trade and other receivables
Trade receivables
Receivables due from group companies
Prepayments and other amounts
2022
£’000
–
7,466
53
–––––––
7,519
–––––––
2021
£’000
217
20,469
34
–––––––
20,720
–––––––
Trade and other receivables are classified as loans and receivables and are held at amortised cost. The carrying
value approximates fair value.
Prepayments relate to prepaid amounts for services to be consumed over the next 12 months.
The recoverability of all receivables has been assessed, a provision of £12.8m has been provided against
a balance due from a subsidiary undertaking.
8.
Trade and other payables
Trade payables
Nontrade payables and accrued expenses
2022
£’000
68
94
–––––––
162
–––––––
2021
£’000
78
92
–––––––
170
–––––––
Trade and other payables are held at amortised cost. The carrying value approximates fair value. All trade
and other payable are due within one year.
9.
Share Capital
Authorised:
Equity: 110,000,000 (2021: 110,000,000) Ordinary shares of 1p each
Allotted, called up and fully paid:
Equity: 105,386,239 (2021: 105,386,239) Ordinary shares of 1p each
10. Reconciliation of net cash flow to movement in net cash
Movement in net cash in year
Net cash at start of year
Net cash at end of year
2022
£’000
1,100
–––––––
1,054
–––––––
2022
£’000
(47)
55
–––––––
8
–––––––
2021
£’000
1,100
–––––––
1,054
–––––––
2021
£’000
(958)
1,013
–––––––
55
–––––––
89
Plexus Holdings plc Annual Report 2022
Notes to the Parent Company Financial Statements continued
11. Financial instruments and risk management
The Company’s activities give rise to a number of different financial risks: market risk (including foreign
currency exchange risk and interest rate risk), credit risk and liquidity risk. The Company’s management
regularly monitors the risks and potential exposures to which the Company is exposed and seeks to take action,
where appropriate, to minimise any potential adverse impact on the Company’s performance.
Risk management is carried out by Management in line with the Company’s Treasury policies. The Company’s
Treasury policies cover specific areas, such as foreign exchange risk, interest rate risk and investment of excess
cash. The Company’s policy does not permit entering into speculative trading of financial instruments and this
policy has been applied throughout the year.
(a) Market risks
(i)
Foreign currency exchange risk
The Company is exposed to foreign exchange risk arising from various currencies. In order to protect the
Company’s statement of financial position from movements in exchange rates, the Company converts foreign
currency balances into sterling on receipt so far as they will not be used for future payments in the foreign
currency.
The Company carefully monitors the economic and political situation in the countries in which it operates to
ensure appropriate action is taken to minimise any foreign currency exposure.
(ii)
Interest rate risk
The Company is also exposed to interest rate risk on cash held on deposit. The Company’s policy is to maximise
the return on cash deposits whilst ensuring that cash is deposited with a financial institution with a credit rating
of ‘AA’ or better.
(b) Credit risk
The Company’s credit risk primarily relates to its intercompany loans and intercompany receivables.
Management have reviewed the recoverability of intercompany loan balances at the reporting date, this has
resulted in a writeoff of £nil (2021: £nil) charged in the year from the assessment of credit losses on Group
balances.
Amounts deposited with banks and other financial institutions also give rise to credit risk. This risk is managed
by limiting the aggregate amount of exposure to any such institution by reference to their rating and by regular
review of these ratings. The possibility of material loss in this way is considered unlikely.
(c) Liquidity risk
The Company has historically financed its operations through equity finance and the flow of intercompany
loan repayments. The Company has continued with its policy of ensuring that there are sufficient funds available
to meet the expected funding requirements of the Company’s operations and investment opportunities. The
Company monitors its liquidity position through cash flow forecasting. Based on the current outlook the
Company has sufficient funding in place to meet its future obligations.
12. Financial commitments
The Company had no capital commitments as at 30 June 2022 (2021: £nil).
13. Contingent liabilities
The Company had no contingent liabilities as at 30 June 2022 (2021: £nil).
Plexus Holdings plc Annual Report 2022
90
Notes to the Parent Company Financial Statements continued
14. Related party transactions
Control
No one party owns a controlling interest in the Company.
Ultimate parent company
There is no ultimate parent company.
Transactions
During the year, the Company had the following transactions with related parties:
Plexus Ocean Systems Limited, a wholly owned subsidiary made net repayments of £660k less net purchases
of £844k, following review the balance has been written down by £12,819k decreasing the balance owed
from £20,469k to £7,466k.
Ben Van Bilderbeek, Graham Stevens and Craig Hendrie are considered to be the Key Management Personnel
of the parent entity. Details of their remuneration is included in the remuneration report.
15. Subsequent Event
In October 2022, the Company raised £1,550,000 through the issue of Convertible Loan Notes (“CLNs”),
which will be used for working capital and to fund the Group’s activities as it seeks to capitalise on the
increasing pipeline of opportunities within its target markets.
91
Plexus Holdings plc Annual Report 2022
Corporate Information
Directors
Jerome Jeffrey Thrall† (NonExecutive Chairman)
Bernard Herman van Bilderbeek (Chief Executive)
Graham Paul Stevens (Finance Director)
Craig Francis Bryce Hendrie (Technical Director)
Charles Edward Jones† (NonExecutive Director)
Kunming Liu (NonExecutive Director)
† Member of Audit and Remuneration committees
Registered Office
Highdown House
Yeoman Way
Worthing
West Sussex
BN99 3HH
Company Number
03322928
Company Secretary
Nominated Adviser and Broker
Auditor
Solicitors to the Company
Registrars
Prism Cosec Limited
Highdown House
Yeoman Way
Worthing
West Sussex
BN99 3HH
Cenkos Securities plc
66 Hanover Street
Edinburgh
EH2 1EL
68 Tokenhouse Yard
London
EC2R 7AS
Crowe U.K. LLP
55 Ludgate Hill
London
EC4Y 8EH
Fox Williams LLP
10 Finsbury Square
London
EC2A 1AF
Ledingham Chalmers LLP
5254 Rose Street
Aberdeen
AB10 1HA
SLC Registrars
Highdown House
Yeoman Way
Worthing
West Sussex
BN99 3HH
Plexus Holdings plc Annual Report 2022
92
Perivan 264659
P O S - G R IP ®
P O S - G R I P ®
P O S-G R IP ®
P ROPRIETARY METHOD O F
P ROPRIETARY M ETHO D OF
PROPRIETARY METHOD OF
FRICTION GRIP ENGINEERING
F RICTION GRIP EN GIN EERING
F RICTION GRIP ENGINEERING
POS-GRIP friction-grip technology is based
on a very simple concept. A compressive
force is applied on the outside of a wellhead
or pipe, to flex it inwards. As the bore of
the vessel moves inwards, it makes contact
with an inner pipe (or hanger) on the inside.
Sufficient contact force is generated to fix
the inner member (hanger) in place through
friction between the two components.
In wellheads, POS-GRIP can replace the
conventional load shoulder or slips to
provide an improved hanger support
mechanism.
Utilising our patented POS-GRIP technology,
we are continually developing new wellhead
equipment to meet our customers’
requirements, delivering solutions for
the surface, subsea and decommissioning
markets.
Plexus HG® technology, is a simple scientific
POS-GRIP friction-grip technology is based
method of design for metal interface seals, used to
on a very simple concept. A compressive
permanently contain METHANE GAS in wellheads,
force is applied on the outside of a wellhead
throughout the life of a producing well.
or pipe, to flex it inwards. As the bore of
the vessel moves inwards, it makes contact
The seal system comprises of multiple integral
with an inner pipe (or hanger) on the inside.
radiused bump rings, which interact directly with
Sufficient contact force is generated to fix
the wellhead bore, to halve the number of leak paths
the inner member (hanger) in place through
past the annulus, using a series of redundant gallery
friction between the two components.
seals. A preload above yield is carefully delivered
and recorded by the externally controlled horizontal
In wellheads, POS-GRIP can replace the
deflection of the housing wall against solid hanger
conventional load shoulder or slips to
bodies, thereby equally distributing perimeter
provide an improved hanger support
stress, in compliance with the principles of Hertzian
mechanism.
Stress Theory (HST).
Production wellheads and surface subsea
have all benefitted from POS-GRIP. Casing and
tubing hangers can be gripped, but POS-GRIP
can also be used to support wearbushings,
BOP test tools and seal sleeves.
Outlet valve equipment to be
supplied through PPC
POS-GRIP APPLICATIONS
Connectors
Wellheads
POS-GRIP is ideal for high integrity, low
fatigue connector applications. Wellhead
connectors, riser connectors, subsea jumper
connectors, pipeline connectors, and even
vessel mooring connectors can benefit from
the simplicity of POS-GRIP.
Utilising our patented POS-GRIP technology,
The system stays permanently rigid, guarantees
we are continually developing new wellhead
life-cycle integrity and is maintenance-free, using
equipment to meet our customers’
re-usable components. By matching materials at the
requirements, delivering solutions for
seal interface, bi-metallic corrosion is prevented and
the surface, subsea and decommissioning
POS-GRIP “HG” Production Wellhead
multiple metal seals are used to anticipate the pace
with PPC valves and tree
markets.
of chemical degradation, throughout field-life.
Wellheads and connectors can both benefit
from the direct contact created when the
POS-GRIP metal to metal HG® seal is activated,
delivering an unrivalled gas-proof seal.
Metal-to-metal sealing
P L E X U S
P O S - G R I P T E C H N O L O G Y
POS-GRIP in OPEN Position
A potential low cost application of
POS-GRIP in CLOSED Position
POS-GRIP in an “HG” Tubing Head
P L E X U S
P O S - G R I P T E C H N O L O G Y
P L E X U S
P O S - G R I P T E C H N O L O G Y
POS-SET Connector recently deployed
POS-GRIP
for a well decommissioning project
Production Wellhead System
POS-GRIP
“HG” Production Wellhead installed offshore
POS-GRIP “HG” Production Wellhead recently intalled offshore
P OS-G RIP AP PL ICAT IO NS
P OS-G R IP APP LIC AT ION S
Wellheads
P L E X U S
P O S - G R I P T E C H N O L O G Y
Wellheads
Production wellheads and surface subsea
have all benefitted from POS-GRIP. Casing and
Production wellheads, both surface and subsea
tubing hangers can be gripped, but POS-GRIP
have all benefitted from POS-GRIP. Casing
can also be used to support wearbushings,
and tubing hangers can be gripped, but
BOP test tools and seal sleeves.
POS-GRIP can also be used to support
wearbushings, BOP test tools and seal
Connectors
sleeves.
Connectors
POS-GRIP is ideal for high integrity, low
fatigue connector applications. Wellhead
connectors, riser connectors, subsea jumper
POS-GRIP is ideal for high integrity, low
connectors, pipeline connectors, and even
fatigue connector applications. Wellhead
vessel mooring connectors can benefit from
connectors, riser connectors, subsea jumper
the simplicity of POS-GRIP.
connectors, pipeline connectors, and even
vessel mooring connectors can benefit from
the simplicity of POS-GRIP.
Metal-to-metal sealing
Metal-to-metal sealing
Wellheads and connectors can both benefit
from the direct contact created when the
POS-GRIP metal to metal HG® seal is activated,
Wellheads and connectors can both benefit
delivering an unrivalled gas-proof seal.
from the direct contact created when the
POS-GRIP metal to metal HG® seal is
activated.
Exact EX 18-3/4” 10k Adjustable Surface
Exploration Rental Wellhead System
POS-GRIP “HG” production wellhead is assembled ready for testing ahead of
drilling and producing a new North Sea well
P L E X U S
P O S - G R I P T E C H N O L O G Y
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