Report & Financial Statements
For the year ended 31 December 2015
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Head Office
66 Grosvenor Street
London W1K 3JL
T: 020 7409 2420
E: info@restoreplc.com
W: www.restoreplc.com
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LOCATIONS
Restore Document Management
T: 01293 446 270
E: admin@restore.co.uk
W: www.restore.co.uk
The Databank
Unit 5 Redhill Distribution Centre
Salbrook Road
Redhill Surrey
RH1 5DY
Harrow Green
T: 0345 603 8774
E: info@harrowgreen.com
W: www.harrowgreen.com
2 Oriental Road
Silvertown
London
E16 2BZ
Restore Shred
T: 01869 238 521
E: admin@restoreshred.com
W: www.restore.co.uk/shred
Restore Scan
T: 01293 446 270
E: enquiries@restorescan.co.uk
W: www.restore.co.uk/scan
234 Heyford Park
Upper Heyford
Oxfordshire
OX25 5HA
Relocom
T: 0345 313 1491
E: contactus@relocom.co.uk
W: www.relocom.co.uk
Restore IT Efficient
T: 01462 813 132
E: ite@itefficient.com
W: www.restore.co.uk/it-disposal
Unit 4B-4F Shefford Industrial Park
St Francis Way
Shefford Bedfordshire
SG17 5DZ
Unit 3 The Links
Popham Close
Feltham
TW13 6JE
ITP Group
T: 0118 943 8001
E: info@itp-group.com
W: www.itp-group.com
Unit 1 Stadium Way
Tilehurst
Reading Berkshire
RG30 6BX
Specialising in the UK office services
market, we have grown over the last
6 years to become one of the most
important suppliers in our sector
Your Company
in safe hands
Records Management
In an industry worth
c.£500–600 million in the
UK, we manage millions of
archive boxes of document
files, magnetic data, film,
national heritage items and
other materials for blue-
chip organisations, from
40 sites across mainland
Britain providing near
and deep storage.
Record management
services include
reorganisation of customer
documents, cloud storage,
electronic data back-up,
document restoration
and file-tracking services
within customers’
own buildings.
See page 12 for more detail.
Scanning
The UK scanning sector
is a diverse market with
operators ranging from BPOs
to software and mailroom
providers. We are the
second largest traditional
bureau scanning operation
in the UK.
Relocations & Storage
A demanding market
where success requires
sophisticated logistics for
what are mission-critical
services to our clients,
whether office relocations or
more specialised moves such
as laboratories or museums,
and for both short and
long-term storage needs.
IT Asset Reuse & Recycling
Driven by regulation such
as the EU Waste Electrical
and Electronic Equipment
Directive and clients’
requirement for secure
destruction, there is
significant growth in
secure asset disposal,
reuse and recycling.
Shredding
Onsite and offsite secure
shredding is a relatively
young, fast-growing and
fragmented, industry worth
c.£180 million per year
in the UK, which is
undergoing consolidation.
IT & Server Relocations
Growth in the IT relocation
market is continuing as
organisations change
hardware configurations
particularly to reflect the
move to cloud services.
Printer Cartridge Recycling
As a collector of empty
printer cartridges, we
provide a link between
our customers and
remanufacturers, of which
we estimate there are up
to 3,000 across Europe.
Restore plc Report & Accounts 2015
Highlights
+36%
Revenue
(£’m)
9
1
9
.
6
7
5
.
14
15
+36%
1
6
3
.
+27%
1
2
0
.
+33%
1
5
6
.
1
2
3
.
Adjusted*
profit before tax
(£’m)
14
15
Adjusted*
earnings per share
(p)
14
15
Dividend per
share
(p)
3
2
.
2
4
.
14
15
Financial Highlights
•
Group revenue up 36% to £91.9m
•
Document Management revenue up 46%;
adjusted operating profit up 31%
•
Relocation revenue up 24%; adjusted operating profit up 24%
•
Group adjusted profit before tax up 36% to £16.3m
• Adjusted earnings per share up 27% to 15.6p
•
Dividend per share up 33% to 3.2p
•
New five-year banking facility agreed
Adjusted Results – Continuing Operations
Revenue
EBITDA*
Operating profit*
Profit before tax*
Earnings per share**
Dividend per share
Net debt
2015
2014 % Change
£91.9m
£67.5m
£20.4m
£14.8m
£17.6m
£12.9m
£16.3m
£12.0m
15.6p
3.2p
12.3p
2.4p
£60.6m
£30.9m
36%
37%
36%
36%
27%
33%
Operational Highlights
• Significant progress in expanding scale and scope of
the Group
• Records Management strengthened position in UK
market, particularly following the WRM acquisition
• Cintas UK and Cannon Confidential integrated
• Six acquisitions completed
• New business stream entered through acquisition
of toner cartridge recycler ITP Group
• Major contract with NDA Archives for Restore Scan
Statutory Results – Continuing Operations
Revenue
Operating profit
Profit before tax
Earnings per share
2015
2014
£91.9m
£67.5m
£7.7m
£6.1m
7.0p
£6.9m
£6.1m
6.4p
*
Before exceptional items (including exceptional finance costs), amortisation
of intangible assets, share-based payments charge and other finance
costs. The reconciliation of adjusted figures is shown in the Group Finance
Director’s statement.
** Calculated based on the weighted average shares in issue and a standard
tax charge.
Contents
Overview
Highlights
What we do
Chief Executive’s statement
Group Finance
Director’s statement
18
20
01
02
Strategic report
04
Where we’ve come from
06
Our history of growth
08
Where we are now
10
How we work
Our markets
12
Corporate Social Responsibility 14
16
Chairman’s statement
24
26
Governance
Board of Directors
Directors’ report
Corporate governance
statement
28
Directors’ remuneration report 30
Statement of Directors’
33
responsibilities
Independent auditor’s report 34
Financial statements
Consolidated statement
of comprehensive income
Consolidated statement
of changes in equity
Consolidated statement
of financial position
Consolidated statement
of cash flows
Notes to the Group
financial statements
Company statement of
changes in equity
35
36
37
38
39
72
73
Company statement of
financial position
Company statement of
cash flows
74
Company accounting policies 75
Notes to the Company
financial statements
76
Other information
Notice of Annual
General Meeting
Officers and advisers
Trading record
91
97
97
01
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information
What we do
Providing office services
nationwide from
58 sites across the UK
Restore Records Management
Livingston
Restore Shred
Manchester
Restore Scan
Redditch
Head Office
Harrow Green
Glasgow
Relocom
Shefford
Restore IT Efficient
Shefford
ITP Group
Reading
Document Management Division
Records Management
Restore Shred
Restore Scan
Relocation Division
Harrow Green
Relocom
IT Efficient
ITP Group
02
Restore plc Report & Accounts 2015 Document Management Division
Relocation Division
+46%
Revenue
(£’m)
5
4
7
.
3
7
4
.
14
15
+31%
Adjusted
Operating Profit*
(£’m)
1
5
1
.
1
1
5
.
14
15
+24%
Revenue
(£’m)
3
7
2
.
3
0
1
.
14
15
+24%
4
1
.
3
3
.
Adjusted
Operating Profit*
(£’m)
14
15
Document Management Division
Relocation Division
The majority of Records Management’s sales are from the storage
and retrieval of hard copy documents, typically stored in cardboard
boxes. It manages millions of archive boxes of document files,
magnetic data, film and other materials for blue-chip organisations,
from 40 sites across mainland Britain, including a 70-acre freehold
underground site near Bath. The business generates additional
service income from the reorganisation of customer documents,
document restoration, file-tracking services within customers’
own buildings, and electronic data back-up. Restore services a
broad range of customers throughout the UK, with the largest
sector being law firms who, as meticulous and sophisticated users
of storage services, ensure the business remains at the cutting
edge of developments in document storage. Other important
sectors include accountancy, corporate, financial, insurance and
media firms, as well as local authorities, hospital trusts and other
government bodies.
Harrow Green is the market leader in UK commercial relocations
– the physical movement of office furniture and other physical
resources when an organisation moves staff either within a
building or to a new site. From eight sites across mainland Britain,
it serves a diverse range of customers, including large corporates,
local businesses and a wide range of public sector bodies, such
as libraries, universities and health trusts. The bulk of its business
is in London, servicing many of the largest offices, particularly in
the financial services sector, with regular customers who have
a frequent demand, often involving staff working permanently
on customer sites. Harrow Green also operates Global Moving
Solutions, providing international moving services, typically for
senior managers of global companies.
Restore Shred offers secure shredding and recycling for
customers across the UK and operates from 6 sites, as well
as having 7 mobile shredding units. Restore entered the
market in October 2011 and has grown its reach through
targeted acquisition. The business has also seen sharply
increased volumes through cross-selling, with customers of
other Group businesses switching to Restore Shred for their
secure shredding and recycling needs.
Restore Scan is one of the country’s leading document
conversion and data management specialists operating
from 9 sites. Its main function is the conversion of hard-
copy documents into electronic data. As part of its service,
it organises and indexes the electronic versions, enabling
customers to identify and locate their data more efficiently.
A significant part of its revenues derive from contracts involving
repeat business, notably for the scanning of exam papers.
*
Continuing operations, before exceptional items (including exceptional
finance costs), amortisation of intangible assets, share-based payments
charge and other finance costs.
Relocom is one of the UK’s leading IT relocations service
providers, helping leading blue-chip organisations during a
relocation, reorganisation or period of change. It specialises
in server and data centre relocation, desktop IT and trading
desk relocation, furniture and IT asset audit and management.
IT Efficient is one of the UK’s leading providers of secure
data destruction and hardware disposal services for
computer equipment. It serves predominately large blue-chip
customers nationwide, processing around 200,000 items of
IT equipment a year. It provides on- and off-site destruction
services alongside recycling, refurbishment and resale of
electronic items.
ITP Group, founded in 1992 and acquired by Restore in July
2015, is the UK’s leading collector of empty printing cartridges. It
collects cartridges from thousands of premises across the UK in
all business sectors, including large corporates, SMEs, NHS Trusts
and schools. It also makes bulk purchases of cartridges from
waste operators and other recycling businesses. Under the ITP,
Takeback and Office Green brands, ITP handles over 1.25 million
items a year.
03
Relocation Division
Harrow Green
Relocom
IT Efficient
ITP Group
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information
Where we’ve come from
Restore refocused its business
to create significant shareholder
value and generate excellent
shareholder returns
Over the course of the past six years, we have taken a business
that in 2009 was close to failure, and refocused it purely on
providing office services. In this time, we have been able to
create significant shareholder value and generate excellent
shareholder returns. Here we chart our progress with the help
of extracts from our previous annual reports.
In the 2008 accounts, as Mavinwood plc, we announced our
objective to ‘acquire and develop specialist support services
businesses that have the potential for growth, either organically
or in combination with other complementary businesses...the
Board is satisfied that Document Handling remains an attractive
market to be invested in and would anticipate it growing in
the future’.
Once our course had been set, we began to implement this
strategy. Part of this process was to rename the company
Restore plc, after our core records management business. By
2010, we were ‘pleased to report a return to profitability’ and
announced ‘our intention to play a role in the consolidation of
this market through the sort of acquisitions we made during
2010’. We knew that what we like to call the ‘box’ business
was good, and we stayed the course.
In 2011, we were ‘confident that office services will remain
buoyant. We have excellent business visibility and are well
positioned to continue to broaden the scale and scope of the
Group’s activities’. Therefore, as well as consolidation in our
main market, we pursued a strategy of broadening our scope
by adding services which complement our existing activities.
In that way, we expanded into secure document shredding
and recycling, as well as divesting non-core activities. We also
recorded revenue for the first time, albeit a small amount,
under the complementary activity of office relocation.
By 2012, ‘our markets, particularly records management,
remained robust and we continued to grow profits at the same
time as securing market leadership in UK office relocations and
rationalising our operational structure. The company is now
wholly focused on UK office services’. Through the acquisition
of Harrow Green we became market leader in office relocation,
in addition to adding substantially to our records management
revenue. We have reinvented Restore plc, built it as we had
planned, and have come a long way from being a new entrant in
the market – and turned our lack of legacy operational systems
and processes to our advantage.
Total shareholder return
Adjusted* Profit Before Tax /
Head Office Costs
£’m
200
180
160
140
120
100
80
60
40
20
2.6
0
2010
205.5
169.6
77.9
43.0
19.2
2011
2012
2013
2014
2015
Total shareholder return – cumulative increase in market value, plus
dividends minus capital raised
04
04
15
12
9
6
3
£’m
2.4
0
2010
16.3
12.0
10.0
6.2
3.7
2011
2012
2013
2014
2015
Adjusted Profit Before Tax
Head Office Costs
Restore plc Report & Accounts 2015 +36%
1
8
8
.
4
3
3
.
1
2
7
.
9
1
9
.
6
7
5
.
5
3
6
.
+36%
3
7
.
6
2
.
2
4
.
1
6
3
.
1
2
0
.
1
0
0
.
+27%
4
3
.
7
4
.
2
7
.
1
5
6
.
1
2
3
.
1
0
5
.
+33%
3
2
.
2
4
.
1
9
.
1
5
.
1
0
.
10
11
12
13
14
15
10
11
12
13
14
15
10
11
12
13
14
15
10
11
12
13
14
15
Revenue (£’m)
Adjusted* profit before tax (£’m)
Adjusted* earnings per share (p)
Dividend per share (p)
The rationale behind offering complementary services is
that our customer base has similar or identical channels to
market – IT and facilities managers – and we are able to use our
comprehensive CRM system to make the most of cross-selling.
In 2013, we continued ‘to focus on increasing our UK market
share. In Records Management this is achieved most successfully
through acquisitions. In some of our other services this is most
likely to be achieved through organic growth, particularly by
leveraging our customer base across the Group’.
We have always been clear about what we were doing. We have
often taken on poor-performing acquisitions and turned them
into good performers, understanding that sometimes this takes
time, which we can afford to give them while they reach their
potential. In 2014, we announced that ‘our principal near-term
focus in 2015 is to integrate the acquisitions made in 2014 and
to drive operating margins in the integrated businesses towards
those we have historically achieved. We are making good
progress in this and we are realising the efficiencies anticipated
at the time of acquisition’.
We set out with the aim of becoming the largest UK-based
provider of UK records management, with a truly national
presence. Through acquisition, and organic growth, we have
achieved this. Since 2010, we have completed 26 acquisitions
in records management and complementary office services.
From our original footprint of seven locations in the South and
East of England, we now have 58 sites around mainland Britain.
From £12.8 million in 2009, our turnover solely in document
management has grown to £54.7 million. The corresponding
figures for office relocation show growth from £3.2 million in
2011 to a figure of £37.2 million for 2015, and we are by some
distance the market leader. In the UK records management
market, we have gone from number nine to number two, and
the number one UK-based provider, during that time.
Having achieved stability and strength in the business, our
most recent document management acquisition, Wincanton
Records Management, has extended our position as the UK’s
second biggest records management operator. In March 2016,
our subsequent disposal of Restore Document Management
Ireland, the Irish business of Wincanton Records Management,
reinforces our focus on the market of which we have a deep
knowledge and where we can achieve better returns.
We are part of the UK landscape but, importantly, we still have
plenty of room to improve and grow.
From Document
Management
to Relocation
In 2011, with the acquisition of Sargents, Restore diversified
into other related office services. Since that time, the
Relocation division has been expanded to incorporate
office and workplace relocations – for which Harrow
Green is recognised as the UK market leader – specialist
IT relocations, IT asset secure destruction, reuse and
recycling and, most recently, printer cartridge recycling.
From its initial revenue of £3.2 million in 2011, the
division achieved revenues of £37.2 million in 2015 and
has opened up significant cross-selling opportunities to
our Document Management division.
*
Continuing operations, before exceptional items (including exceptional finance costs), amortisation of intangible assets, share-based
payments charge and other finance costs. The reconciliation of adjusted figures is shown in the Group Finance Director’s statement.
05
05
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information
Our history of growth
A timeline through six
years of successful
acquisitive growth
Acquisition
of Paterson
Document
Management
Acquisition
of Brunswick
Document
Management
Acquisition
of Atix
Acquisition
of Archive
Solutions
Name change
to Restore plc
Acquisition
of Formsafe
Acquisition
of M&L Document
Destruction
Acquisition
of ROC
Relocations
Acquisition
of Management
Archives
28.8p
2010
Acquisition
of Datacare
2011
Acquisition
of Sargents
2012
2013
Sale of
Peter Cox
Acquisition
of File and
Data Storage
Share placings
21 Oct 2010
£4.0m at 26p
02 Aug 2011
£4.6m at 65p
02 Mar 2012
£8.5m at 75p
03 Oct 2012
09 Apr 2013
07 Oct 2014
£3.0m at 93p
£7.0m at 111p
£14.9m at 210p
08 Dec 2015
£34.0m at 260p
06
06
Acquisition
of Restore Shred
Acquisition
of Harrow Green
Acquisition
of IT Efficient
Restore plc Report & Accounts 2015 Current UK market position
Records
Management
Shred
Scan
Relocation
IT Relocation
Reuse &
Recycling
Cartridge Recycling
Collectors
2
3
2
1
Top 10 Top 10
1
Acquisition
of Cintas UK Document
Management UK
Acquisition
of Document
Imaging & Archiving
Acquisition
of Cannon
Confidential
Acquisition
of Filebase
Acquisition
of Magnum
Secure
299.0p
Acquisition of Crimson UK
Continuing to build scale
(while rationalising nationwide
reach), bringing new customers
and 2 significant new contracts.
S
h
a
r
e
P
r
i
c
e
Acquisition of Wincanton
Records Management
Yielding 5 additional sites in key
areas across mainland Britain – providing
an additional 5.2m cu.ft. storage (at 69%
capacity) – and c.600 customers.
2013
2014
2015
2016
Majority stake
in Relocom
Acquisition
of Ancora
Acquisition
of Diamond
Relocations
Acquisition
of Papersafe UK
Acquisition of ITP Group
Entering a new and profitable
area of office support recycling, with
a customer base of c.5,000, provides
further cross-selling opportunities
to the Group.
07
07
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information
Where we are now
• Strong growth
• Good operating margins
• High visibility of earnings
Growth through
acquisition
and market
consolidation
Integration and
improvement of
acquisitions
ACQUISITION OF
WINCANTON
RECORDS
MANAGEMENT
Restore acquired WRM
in December 2015,
extending its position as
the second largest records
management business in
the UK. The acquisition:
• materially increased
the scale of the
enlarged Group in
the UK in terms of
revenue (+£14.8m), RM
customer base (+600)
and storage capacity
(+5.2m cu.ft.
at 69% capacity)
• provided an
opportunity to realise
significant synergies
•
is expected to be
earnings enhancing
in its first full year of
ownership.
INTEGRATION –
CINTAS UK AND
CRIMSON
The acquisition of Cintas
Document Management
UK and, later, Crimson UK
have enabled Restore to
significantly increase the
scale of scanning services,
while realising synergies
and rationalising our
presence across mainland
Britain to best meet
customers’ needs.
Along with new
customers, providing
further cross-selling
opportunities, the
enlarged scanning
business has brought
opportunities to win
larger contracts.
Competitive
advantage
through UK
focus and market
knowledge
CASE STUDY –
OXFORD RADCLIFFE
HOSPITAL NHS
TRUST
Oxford University
Hospitals, a world
renowned centre of clinical
excellence and one of
the largest NHS teaching
trusts in the UK, chose
Restore to provide record
management services
to handle the Trust’s 1.5
million patient records.
They required storage of
both active and non-active
records, daily retrievals
and collection services,
and destruction services.
Critically, they required
emergency retrieval within
2 hours which Restore
was able to provide
through record indexing
and near storage.
Group-wide
cross-selling
opportunities
DIVERSIFYING INTO
COMPLEMENTARY
MARKETS – ITP
GROUP
ITP Group, the market
leader in UK empty printer
cartridge recycling,
provided Restore with
a complementary new
business opportunity.
Bringing with it a customer
base of c.5,000 has
given Restore further
opportunities to cross-sell
Document Management
and other Relocation
services to our new
customers and to cross-sell
printer cartridge recycling
services to the Group’s
existing customers.
08
08
Restore plc Report & Accounts 2015 Growth in revenue of 36% in 2015
Adjusted operating margins of 19% across the Group
Long-term storage and long-term contracts
Complex and
mission-critical
operational
services
Strong,
predictable
recurring
revenues and
high customer
retention
CASE STUDY –
RELOCATING
CAMBRIDGE LMB
CASE STUDY –
GRANT THORNTON
LLP
The brief: move Cambridge
Laboratory of Molecular
Biology staff, equipment,
facilities, IT desktop
equipment and servers
into a new purpose-built
building, while keeping
downtime to a minimum,
with departments back in
operation in the shortest
possible time.
The size: 600 scientists and
support staff; 8 weeks;
9,000 crates.
The added solution:
‘Hot Teams’, flexible in
size, ensured downtime to
science research projects
(expected by the client to be
7 days) was kept to 3-4 days.
Grant Thornton has been
a longstanding customer
of Restore, having sought
a document management
provider who could meet its
requirements for national
coverage and a partner who
understood and reflected
its priorities of service, value
for money, sustainability
and excellence.
We provide training for
our online web portal
that has been tailored to
meet its needs, as well
as advice on retention
periods, destruction best
practice, improved KPIs,
cost analyses, management
information reporting,
shredding and scanning.
Strong growth
• Growth through acquisition and
market consolidation
• Integration and improvement
of acquisitions
• Competitive advantage through UK
focus and market knowledge
• Group-wide cross-selling opportunities
In addition to pursuing organic growth,
being actively acquisitive in our
spheres of expertise provides us with
opportunities to benefit from scale.
Good operating margins
• Integration and improvement
of acquisitions
• Complex and mission-critical
operational services
By offering complex services, which
require long-term investment, our
businesses typically record double-digit
operating margins.
High visibility of earnings
• Strong, predictable recurring
revenues and high customer retention
Through long-term contracts in Records
Management and Relocation, such as churn
based projects, we generate predictable
recurring revenues and through first class
service have high customer retention levels.
09
09
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information How we work
Restore provides office
services across all of
mainland Britain
Our strategy
We aim to be a market leader in the spheres we operate in,
and to maintain a truly national network across mainland
Britain, deriving competitive advantage from our market
knowledge and focus. In all of our business streams,
particularly Records Management, customers prefer not to
change suppliers, due to the complexity and disruption of
doing so. This offers a strong source of predictable, recurring
revenues, as the volume of documents requiring attention
tends not to vary with the economic climate, nor with
advances in technology.
We frequently build our market share and reach by acquisition.
This way, we have been able to offer customers with national
presence the opportunity to consolidate their supplier
base. We have a proven record of acquiring and integrating
businesses, and achieve industry-leading margins in Records
Management through scale, tight cost control and low
property rental costs.
Overall we aim to consolidate certain inter-related UK office
services where there are benefits from scale and through
consistency of demand – and which are of limited interest
to large facilities management companies. With a strong
business in Records Management, we have been building
our shredding, scanning and recycling activities where
the customer base and skillset required are similar. Our
relocations and document activities share a similar customer
base – which is the IT and facilities managers responsible for
keeping their offices running smoothly. We understand these
customers, and what it takes for UK offices to work well.
With our activities all having this similar channel to market,
we cross-sell the services we offer, using our comprehensive
Customer Relationship Management system to identify such
opportunities. Our relocations businesses generate excellent
opportunities as office and IT relocations often lead to a need
for off-site document storage, shredding or scanning, and
computer equipment requiring secure recycling or destruction.
Ours is a decentralised model, with autonomous divisions
supported by a head office. Our key principle is that power
and responsibility go hand in hand. Our people know what
is expected of them and have the power to make their
own decisions. This is crucial in a business where first-class
customer service is the key to satisfying and retaining
customers. We achieve success through well-motivated,
capable people doing their jobs to the best of their ability.
HOW WE CREATE VALUE
Operate in areas where:
• Revenues are recurring
• There is operational complexity
• There is a similar channel to market
• It is unattractive for customer
to change suppliers
• There is reasonable scope
for cross-selling
Operating Model
Operate in an
attractive
market
Generate new
business, including
from Group customers
not using the service
Invest to increase
market share
and operational
efficiency
Use scale to improve
customer service
and operating
margins
10
Restore plc Report & Accounts 2015 We aim to consolidate certain
inter-related UK office services where
there are benefits from scale and
through consistency of demand
Our customer base covers a broad range of sectors such as government and local government, public sector, health services,
retail, manufacturing, construction, education, utilities, financial services, media, legal, IT and FTSE 100 companies.
We provide services to
60%
of FTSE 100 companies
96%
of top 25 UK
accountancy companies
72%
of top 100 UK
legal practices
41%
of local authorities
in England, Scotland
and Wales
41%
of UK National Health
Service trusts
Service Offering Expansion Model
Financial Growth Model
Hold strong
position in
market
Increase market share
and improve margins
through operational
efficiencies
Enter related
market, probably
through
acquisition
Grow business
through acquisition
of companies in same
market
Organise and
understand new
business stream
Grow business
through leveraging
Group customer
base
Strong operational
business generates
funding capability
Achieve and report
results showing
strong return on
invested capital
Invest in
organic
growth
Acquire
related
businesses
where strong
return on
invested
capital
available
Performance
generates strong
return on invested
capital
11
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Our markets
We provide outsourced
services to offices, principally
in mainland Britain
Records Management
This is a large global industry with many
international operators. The UK market,
worth an estimated £500–600 million
per year, has been established for over
30 years and is still growing at around
5 per cent a year. The market continues
to be consolidated, offering participants
the benefits of operating at scale, which
facilitates improved cost control.
There are high barriers to entry in
records management, largely due
to the difficulty in acquiring new
customers and the investment required
to meet increasingly higher regulatory
standards. Larger customers often seek
to consolidate suppliers with a single
operator who can provide geographical
coverage, whilst achieving efficiency,
space and cost savings.
Cloud storage is sometimes perceived
as a threat to hard-copy records
management; while in percentage terms
only a small amount of data now ends
up on paper, the amount of data as a
whole has increased exponentially and
cloud services, which suffer repeatedly
from concerns over security, have not
affected overall storage volumes.
Restore
We remain number 2 in the UK market
behind the leading global player, as we
continue to build scale through market
consolidation and cross-selling. We
offer national coverage and one of
our core differentiators is our
understanding of the specific
requirements of UK customers.
Shredding
The UK security shredding
and recycling market is worth
approximately £180 million a year.
There are two leading players, each
with over 15 per cent of the market.
Shredding is a relatively young,
fragmented and fast-growing industry
at the early stages of consolidation.
Small regional businesses struggle
to meet new legislation and audit
standards, or fund modern high-
security mobile shredding vehicles.
Sales are generated from the
collection and destruction of
documents, as well as sales of baled,
shredded material for recycling,
mainly for tissues. Demand for
destruction continues to grow
strongly, driven by legislation both for
data protection and environmental
disposal. Volume shredding is very
time-consuming and so outsourcing
is likely to remain the chosen
option. On the recycling side, tissue
consumption is growing at 3.5 per
cent a year, and recovered fibre
prices rose 15 per cent in 2015.
Restore
Restore is currently ranked number
3 in the UK market. Consolidation
and acquisition of mid-market firms
will continue to provide growth
opportunities in key geographical
areas. The Restore Shred business is
highly complementary to our storage,
scanning and relocations businesses,
and this leads to important cross-
selling opportunities.
Scanning
It is difficult to assess the size of the
scanning market because such a wide
range of businesses provide these
services. Often they specialise in
certain functions and can principally
be categorised as:
• Business Process
Outsourcing providers
• reprographics and print
providers and retailers
• scanning bureaux
• mailroom providers
• software houses
• other document management
service providers
A rough estimate would place the size
of the entire scanning market at more
than £500 million a year. Industry
consolidation is underway, especially
at the smaller end of the market.
Restore
Restore is the second largest traditional
bureau scanning operation in the UK.
Historically our segment of the market
was dominated by major one-off projects
but now we are more focused on
recurring revenues from major contracts
for long-term backlog clearance, or work
such as exam paper processing.
12
Restore plc Report & Accounts 2015 Most of our larger customers have
a steady demand for our services,
largely unrelated to the economic cycle
Relocation including IT
The market for high-level corporate
and specialist workplace relocations
remains steady at in excess of £100
million a year in the UK.
Success in this demanding market is
based on sophisticated logistics for
what clients see as a mission-critical
service. Thus, there are high barriers
to entry, especially at the top end of
the market. Accordingly, customer
relationships tend to be long-term as
reliability and knowledge of customer
sites is key.
Growth in the IT relocation market is
continuing as organisations change
hardware configuration to reflect
the move to cloud services. We also
anticipate growth in furniture recycling,
a relatively immature market.
IT asset reuse and recycling
The market benefits from regulation
relating to the safe and secure
disposal of IT equipment and mobile
phones, including the EU Waste
Electrical and Electronic Equipment
Directive. This increasing focus within
the industry on responsible handling,
together with security and corporate
social responsibility, provides
significant growth in secure asset
disposal, reuse and recycling, often to
the benefit of charitable causes.
This service includes a manufacturing
and retail element for sale of recycled
and refurbished equipment with a
target of 0% landfill on disposal.
Printer cartridge recycling
There are an estimated 10,000
cartridge remanufacturers
worldwide, employing over
65,000 people. Across Europe we
estimate that there are c.2,000–
3,000 professional cartridge
remanufacturers and many
companies which provide the third
party empty cartridge supply link
between cartridge users and the
remanufacturers.
Worldwide cartridge shipments have
increased from 450 million units to
466 million, with revenues exceeding
$55 billion. Approximately 20–30%
of all cartridges sold worldwide are
now remanufactured and of the
c.150 million toner cartridges sold
in EMEA each year an estimated
100 million units are remanufactured
OEM cartridges.
Restore
In this sector, Restore, through
its Harrow Green and Relocom
businesses, offers national coverage.
We are well-established with a blue-
chip customer base, for whom our skills
in complex project management are
essential. Our relocations businesses
are also excellent lead generators
for our document management and
recycling businesses, as relocation
often prompts decisions about
archiving and legacy equipment.
Restore
IT Efficient has a strong presence in
the financial services sector, including
services to five of the world’s leading
investment banks. In addition to
bringing in new customers, we look to
increase our market share by cross-
selling to the Group customer base.
Restore
ITP Group is the UK’s leading collector
of empty printing cartridges, and also
makes bulk purchases from other
collectors, so extending the Group’s
recycling capabilities. ITP continues
to be market leaders with innovation,
trust, quality and service being key
components of its continued growth.
13
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Corporate Social Responsibility
We strive to change even the little things to
increase our overall impact
Giving back to society
As a company and as a workforce, everyone at Restore is
committed to being a good citizen and playing a useful role in
society. We aim to minimise our carbon footprint, support local
communities and contribute towards charitable efforts.
Within our own operations, the issues of energy conservation,
waste management and the prevention of pollution are key
considerations. We work hard to ensure we:
• reduce consumption of materials and promote
re-use and recycling – our aim is to achieve 0% landfill
• achieve continual improvement in environmental
performance
• minimise the impact of our operations on the environment
• minimise the impact of our buildings, structures and
operational plant by reducing visibility and noise levels.
• Energy management and recycling – we work with the
Carbon Trust to reduce our environmental impacts through
recycling and reducing energy consumption
• Lighting – we are currently migrating our storage facilities
to a mix of ultra-low wattage LED lighting, very slim T5
fluorescent tubes and PIR sensors.
Restore continues to work with The Carbon Trust implementing
the agreed 10-point plan of action and, having been audited
under the Energy Savings Opportunity Scheme in 2015, Restore
is now ESOS compliant.
The Restore Shred recycling programme handled 25,000 tonnes
of office paper in 2015, which is equivalent to saving over
400,000 trees from being cut down. All of the shredded and
baled paper produced is sent to UK tissue mills to be used in
products such as paper towels, hand wipes and tissue sheeting
for the NHS.
We help our clients:
• make more efficient use of office space and public service
facilities, by storing documents in remote premises
•
improve access to important documents – our Restore Scan
service creates efficient processes for public services
• reduce their carbon footprint with our Restore Shred and ITP
Group services
• recycle IT equipment and office furniture, or offer it for
charitable re-use or re-sale.
Working to recycle and reduce energy use in our
Document Management division
As a provider of full life cycle document and digital information
management, recycling is a key element of Restore’s business.
Paper from millions of archive boxes at end of life is despatched
to Restore Shred – with a 100% recycle rate. We also take day-to-
day steps to minimise our use of natural resources:
• Archive boxes – we use millions of easily assembled, double-
walled construction boxes that are made from material that
is 70% recycled, along with responsibly sourced FSC-certified
raw material. At end of life, the boxes are turned into toilet
paper, carpet and cling film rolls
• Fuel and fleet management – we run a modern fleet of
vehicles optimised for fuel efficiency. We plan deliveries and
collections to reduce fuel use and use GPS tracking
to enhance fleet utilisation
Supporting a local bio-energy project
Our two high-security storage facilities at Bentwaters Park
near Ipswich source power from a bio-energy scheme set up
by a group of local farmers. Anaerobic digesters run on a mix
of vegetable and maize silage and apple pressings, consuming
70,000 tonnes a year. Of that, 60,000 tonnes is sourced from
within a five to ten mile radius.
Promoting sustainability at Relocation division
Our Relocation division is fully committed to sustainability. The
division is bringing its knowledge, expertise and passion for
sustainability together to make energy, carbon and cost savings.
Harrow Green has achieved The Planet Mark sustainability
certification, which is provided by Planet First in partnership
with the Eden Project. This certification is awarded only after
a rigorous assessment of business activity and involvement in
the community. It demonstrates our commitment to reducing
energy, water and fuel consumption and associated carbon
emissions. Through The Planet Mark certification, we achieved
a 12% carbon reduction per employee from 2014 to 2015.
Our IT Efficient resale, reuse and recycle programme handled
200,000 items such as mobile phones, PCs and printers, with 0%
going to landfill, and our ITP service collected over 1.25 million
printer cartridges for reconditioning and reuse in 2015.
1414
Restore plc Report & Accounts 2015
Restore plc Report & Accounts 2015 In 2015:
1,250,000+
printer cartridges collected
for reconditioning
200,000
IT assets resold,
reused or recycled
25,000
tonnes of paper recycled
2,000+
tonnes of No Longer
Needed assets distributed
to good causes
Investing in people
We believe in caring for our employees, the communities in
which we work and for everyone that comes into contact with
the organisation. Of course, the more we grow, the more jobs
we are able to create. We are also involved with the Growing
Talent project run by PricewaterhouseCoopers, which helps get
unemployed participants into work.
Our employees regularly take part in a wide variety of
charitable and community initiatives, where possible supported
by the Group. Recent events include the London Marathon,
Moonwalk for Breast Cancer and a skydive raising money for a
local charity. Funds have also been raised for:
• MacMillan Cancer Trust
• Wear it Pink
• Pear Tree Specialist School
• Help For Heroes
• NSPCC
• St Clare Hospice
• Jeans for Genes
• British Legion
• Smartworks
Health and Safety
We are proud of our excellent health and safety record
and are committed to continually improving health
safety management systems and safety cultures throughout
the organisation.
Health & safety incidents
Document
Management
2015
8,309
2014
4,768
5
7
5
7
0.06%
0.10%
Relocation
2015
2014
963,438
604,987
9
3
2
1
0.0009% 0.0003%
• Employee
man months
• Employee
man hours*
• RIDDOR
events
• Near misses
• RIDDOR
events per
man month
• RIDDOR events
per man hour
* Measured in hours due to the nature of the Relocation business.
RIDDOR – Reporting of Injuries, Diseases and Dangerous Occurrences
Regulations 2013.
Charity and
community support
Through our Re-Fresh programme, each year Harrow Green
provides over 2,000 tonnes of No Longer Needed assets to
charities, schools, community and voluntary groups and
start-up businesses in its area of operation. This brings huge
benefit to these organisations, providing them with assets
and equipment which they could not otherwise afford, and
keeps landfill waste to a minimum. So, after the flooding in
Leeds in December 2015, Harrow Green donated furniture to
local businesses affected by the floods.
Harrow Green also contributes to the community by
providing its services free of charge for small charities and
community groups, when possible. For example, we have
provided trucks and drivers to help Crisis at Christmas, which
offers a lifeline for thousands of homeless people during the
holiday period.
Both IT Efficient and ITP Group provide the facility to their
customers to donate respective resale and recycle profits
to charitable causes.
Restore Records Management is a sponsor of the Surrey
Care Trust which provides learning, training, volunteering
opportunities and support for people who have been held back
through disadvantage and hardship. In 2015 we also initiated
support for the Willow Foundation, which helps people aged 16
to 40 who have been diagnosed with a life-threatening illness.
In 2015, Restore Shred formed a corporate partnership with
the Woodland Trust to support its programme of planting
tens of thousands of trees, in addition to supporting tree
conservation and wildlife protection. Restore Shred also
supports a number of regional hospices.
Restore plc Report & Accounts 2015
1515
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Chairman’s statement
The increase in scale of our business in recent
years enhances our ability to grow organically
through increased operational efficiency,
cross-selling and greater market presence
Results
I am pleased to report another strong performance by your
Company. For the year to 31 December 2015, profit before tax,
exceptional items, amortisation, discontinued activities and
share-based payment charges was £16.3 million, a year-on-year
increase of 36% (2014: £12.0 million). Turnover was £91.9 million
(2014: £67.5 million), with a large part of the year-on-year increase
reflecting acquisitions made in both 2014 and 2015. Earnings per
share on an adjusted basis were up 27% at 15.6 pence (2014:
12.3 pence). The recommended final dividend is up 37% at 2.2p.
These results exclude our Irish business, acquired as part of
Wincanton Records Management in December 2015, whose
sale was completed on 10 March 2016.
Strategy
We are now established as an important supplier of services to
UK offices and workplaces. The increase in scale of our business
in recent years enhances our ability to grow organically through
increased operational efficiency, cross-selling and greater
market presence.
The services that all of our operations supply have
common features:
• A strong element of recurring revenues
• A degree of operational complexity which enables
good margins to be achieved
• A similar channel to market: typically through our
customers’ facilities managers or IT managers
• Switching suppliers is neither desirable nor practical
for customers
• Reasonable scope for cross-selling most of the other
services we offer.
business streams in the Document Management division, Scan and
Shred, both have substantial scope for profitable growth and we
expect them to show significant improvements in profitability over
the coming years. As part of this, they now have their own newly-
appointed managing director who is focused exclusively on these
businesses’ growth. In the Relocation division, we offer three other
services in addition to office relocation: IT relocation, IT recycling
and toner cartridge recycling, the last of which was added through
the acquisition of ITP Group in July 2015. We believe all these
businesses have scope for significant growth and benefit greatly
from being part of Restore.
We continue to look at opportunities to enter related markets
which share the attributes referred to above.
We have invested heavily in terms of management time in
establishing a Group-wide customer relationship management
system. This enables all of our sales staff in all our business
streams to recognise and leverage the contacts we have developed
elsewhere in the Group. Despite being operationally and
managerially decentralised, this ability to plug into our Group-
wide customer contacts makes the process far more effective for
our sales people looking to introduce their service into our Group
customers. This creates momentum for all sales staff across
the Group.
We believe that it is key to our business that we focus on areas
where we can benefit from cost and customer synergies. As part
of this, on 10 March 2016 we completed the sale for €36 million
(£27.8 million) of our Irish records management business, acquired
in December 2015 as part of Wincanton Records Management.
While this is a high-quality business, it provides limited scope to
generate substantive cost synergies. We are confident that we will
be able to generate a better return in the long term on the funds
realised by redeploying them in our core UK market.
Most of our business streams have a significant presence in their
respective markets. We are well established as one of the two
major records management businesses in the UK, and further
strengthened that position following the acquisition of Wincanton
Records Management in December 2015. Records Management
currently accounts for about half of Group revenues and the
majority of Group operating profit and we continue to seek out
appropriate records management acquisitions. Harrow Green is
the UK market leader in office relocation by some distance and the
Relocation division has increased operating profit from £0.3 million
to £4.1 million over the last four years.
Trading
Our Document Management division performed satisfactorily
overall. Its turnover was £54.7 million (2014: £37.4 million) and
adjusted operating profit was £15.1 million (2014: £11.5 million).
Its core Records Management business continued to demonstrate
the strength of its financial model. In contrast, our smaller Scan and
Shred businesses, which had both been substantially enlarged by
acquisitions made in 2014, performed below our expectations during
a year of change. We took steps to address the underperformance of
both businesses during the year and are confident they will deliver an
improved contribution to the Group in 2016.
Restore Records Management and Harrow Green are respectively
the two leading businesses in our Document Management and our
Relocation divisions. Sitting alongside these two large activities, we
have other smaller businesses which either currently have a strong
UK market position or the opportunity to build one. Our two other
Our Relocation division continued to trade strongly. The division’s
turnover was £37.2 million (2014: £30.1 million) and adjusted
operating profit was £4.1 million (2014: £3.3 million); these figures
include ITP Group, the toner cartridge recycling business acquired
in July.
16
Restore plc Report & Accounts 2015 +36%
£91.9m
(2014: £67.5m)
Revenue (£’m)
+36%
£16.3m
(2014: £12.0m)
Adjusted* profit
before tax (£’m)
+27%
15.6p
(2014: 12.3p)
Adjusted* earnings
per share (p)
+33%
3.2p
(2014: 2.4p)
Dividend per share (p)
Corporate Transactions
Much of the operational focus of the Group was on integrating
the acquisitions made in 2014, notably Cintas UK and Cannon
Confidential, both of which were operating at marginal
profitability at the time of acquisition. As expected at the time
of acquisition, several acquired businesses required substantial
restructuring during the year and, following significant
investment, these are now showing a marked improvement
in profitability under our ownership.
Nonetheless, 2015 was another key year in the strategic
development of the Group with several acquisitions including the
largest ever undertaken by Restore.
In total, six acquisitions were made in the year:
•
•
•
In January, we acquired Ancora, a records management business
in East Anglia, a region in which we were under-represented, for
£0.5 million
In July, we acquired ITP Group, the UK’s largest toner cartridge
recycling business, for £3.6 million (net of cash acquired). This
took us into a new business activity but one very closely aligned
to our existing services
In August, we acquired Data Imaging and Archiving, a scanning
and records management business based in South London, for
£1.5 million. We are in the process of relocating the acquired
boxes into our estate and have transferred the scanning to our
facility in Hanworth, South-West London
• Also in August, we acquired Crimson UK, a Manchester-
based scanning business for an initial cash consideration of
£1.0 million. We have subsequently moved its Manchester
operations into our facility in Manchester
•
In December, we acquired Wincanton Records Management,
one of the largest UK records management companies, which
also has a significant presence in Ireland, for £57.3 million.
This extended our position as one of the two major UK records
management operators
• Also in December, we acquired Diamond Relocations in South
London for £1.0 million. This provides Harrow Green with a
South London base and a small records management operation,
which has been integrated into Restore.
Funding
Net debt at the year-end was £60.6 million (2014: £30.9 million).
The increase in net debt reflects the cost of acquisitions made
during the year. As part of the acquisition of Wincanton Records
Management in December, a new banking facility was put in place
with Barclays and Royal Bank of Scotland. We now have in place a
£50 million Term Loan maturing in December 2020 and a 5-year
Revolving Credit Facility of £30 million, with an additional
* Before exceptional items (including exceptional finance costs), amortisation
of intangible assets, share-based payments charge and other finance costs.
The reconciliation of adjusted figures is shown in the Group Finance
Director’s statement.
£20 million available. The Wincanton Records Management
acquisition was also funded by the placing of 13.1 million shares
at 260 pence per share.
Following the disposal of our Irish records management business
for €36 million (£27.8 million) on 10 March 2016, net debt has been
reduced sharply. We therefore have considerable funds available to
us to continue to develop the company.
Dividends
Your Board is recommending a final dividend of 2.2p, payable on
8 July 2016 to shareholders on the register on 10 June 2016. The total
dividend for the year is 3.2p, a 33% year-on-year increase. It remains
the Board’s firm intention to follow a progressive dividend policy.
People
Our business has grown significantly in recent years and that is
reflected in the increased size of our workforce. We now have
over 1,200 employees. We remain committed to the principle of
locking power and responsibility together at all levels within the
business and letting our people get on with their job with minimal
interference. I believe this lies at the heart of our current success
as we are wholly dependent on the abilities of our people and their
commitment to serving our customers.
As our Group increases in scale, we are able to offer greater
stability and career opportunities for all our people. We are also in
a position to provide to our people the support and development
that is appropriate to a larger company without losing the flexibility
to treat people as individuals.
I thank all our people for their commitment over the last year and
look forward to them continuing to share in the success of the
Group. I also welcome the people who have joined us through
acquisitions made over the year.
Outlook
Looking ahead, our near-term focus will be on delivering the cost
and capacity synergies from the Wincanton acquisition, continuing
to improve the performance of our Shred and Scan businesses, and
ensuring that our newer activities, in particular IT recycling and printer
cartridge recycling, benefit in full from the cross-selling opportunities
that arise from the breadth of the Group’s customer base.
We will continue to pursue our strategy of organic and acquisitive
growth. The current year has started satisfactorily and we look
forward to delivering another year of strong progress in 2016.
Sir William Wells
Chairman
24 March 2016
17
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Chief Executive’s statement
Our Document Management and
Relocation divisions both delivered
very strong growth in operating profit
Document Management
Trading in Document Management overall was steady in 2015
with adjusted operating profits increasing by £3.6 million to
£15.1 million. Turnover increased from £37.4 million to
£54.7 million. The majority of the increase in revenue derived
from acquisitions made during the year. The decline in operating
margin reflected a higher percentage of revenues deriving from
activities other than records management, but was also affected
by the limited initial contribution from those activities.
Records Management comprises the bulk of these results
and its performance remained robust. Organic box growth in
the established business, defined as increase in box numbers
from existing customers, continued to run at 7%, while new
box growth, at over 6%, was stronger than in prior years
and well above the industry average. After box destructions
and permanent retrievals, overall net box growth (before
acquisitions) was in excess of 6%. The box growth in acquired
businesses was at appreciably lower levels at both the former
Cintas UK and Wincanton Records Management businesses and
we expect this to continue for some time given their weak sales
pipelines at the time of acquisition. This will adversely affect the
overall box growth rate in the business in the short term.
Prior to the acquisition of Wincanton Records Management,
capacity levels across the business were comfortably in excess
of 90%, and approaching full capacity in the South East. On
acquisition, Cintas UK had been operating at 68% of available
space; this is now in excess of 90%, in line with the levels we
have historically achieved. Combined with extensive cost
restructuring, the profitability of the former Cintas UK business
is now in line with the established Restore business. The
increase in capacity utilisation has been driven by a combination
of box growth and the closure of several sites across the
combined business where there was the opportunity to leave
inappropriate sites at low cost. The acquisition of Wincanton,
whose pre-acquisition capacity levels in the UK business were
at 69%, provides us with much-needed space in the South-
East, particularly as we will be exiting our site in Charlton in
2017. With the need to accommodate new box growth and
the opportunity to leave certain other sites, we are confident
that our overall capacity utilisation will have been optimised
by the end of 2016 and that operating margins in the records
management division will be in line with historic levels.
Alongside additional capacity from acquired businesses, we
continue to develop the most attractive of our existing facilities.
We are developing another district in our freehold underground
site in Wiltshire, which we expect to begin utilising in 2017, and
have continued to lease additional hardened aircraft shelters
at Upper Heyford, with a further two currently being prepared.
We have taken on similar aircraft shelters in East Anglia and we
envisage more capacity will become available there. Overall, we
feel we are well positioned with the space currently occupied
and available to us across mainland Britain. In the medium term,
we expect a shortage of appropriately-priced space in the South
East to become more of a feature for the sector as a whole.
Restore Scan, which primarily comprises the Cintas UK scanning
business acquired in October 2014, had a difficult year with
a poor operational performance on its largest contract and
several major contracts being delayed. The management
structure was inappropriate and this was substantially changed
during the course of the year. We also closed part of our site
at Peterborough. Despite the poor operational performance,
Scan’s largest contract has been extended to 2017 and we also
signed a significant 5-year contract in September with NDA
Archives. We have several large contracts for NHS Trusts and
a stable base of recurring business. We have invested heavily
in Scan and following the changes made during the year we
believe it has strong growth prospects.
Restore Shred, our secure shredding and recycling business,
showed steady organic growth but has yet to achieve the critical
mass to generate an appropriate contribution to the Group. We
have invested in new equipment, including a new IT system.
We continue to expect that Restore Shred will in due course
become a significant operator in the UK market, particularly by
leveraging the Group’s customer base effectively, and remain
confident that it can generate good returns.
Relocation
The Relocation division recorded adjusted operating profits
for the year of £4.1 million (2014: £3.3 million) on revenue
of £37.2 million (2014: £30.1 million). The uplift in revenues
partly reflected the acquisition of ITP Group but was also
driven by strong organic growth in all three of the ongoing
business streams.
Revenues in the core Harrow Green office relocation business
showed yet another strong year-on-year improvement, as well
as an increase in operating margins. Market conditions remained
buoyant, particularly in the London office market, and we
benefited from a continued good level of activity by our major
customers. Major one-off projects undertaken during the year
included work for the BBC, European Bank for Reconstruction
and Development, Slater & Gordon and Net-a-Porter. We
completed our first year of our contract for work with the
Ministry of Defence, which was particularly busy following the
rebasing of several Army units to the UK from Germany. GMS,
our international moves business, showed a strong year-on-year
improvement in both revenues and contribution.
18
Restore plc Report & Accounts 2015 Divisional Performance
Document Management
Relocation
Head Office costs
Total
Revenue
2015
£54.7m
£37.2m
–
£91.9m
Revenue
2014
£37.4m
£30.1m
–
£67.5m
Adjusted* Operating
Profit 2015
£15.1m
£4.1m
(£1.6m)
£17.6m
Adjusted* Operating
Profit 2014
£11.5m
£3.3m
(£1.9m)
£12.9m
* before exceptional items (including exceptional finance costs), amortisation of intangible assets, share-based payments charge and other finance costs.
Relocom, our IT relocation business, had an excellent year with
increased revenues and a doubling of its contribution year-on-
year. Its major customers were active and its contract to install
collection lockers for Amazon continued to grow. It continues to
work more closely with Harrow Green and IT Efficient, which is
being reflected in higher revenues.
IT Efficient, our IT recycling business, increased revenues
although its contribution to the Group was broadly flat year-on-
year. In the three years since we entered this market we have
established a blue-chip customer base from whom we receive
equipment. As we look to broaden IT Efficient’s customer base,
the Group’s customer base, particularly that of the recently
acquired ITP business, should be helpful in this regard.
ITP Group, our toner cartridge recycling business acquired in
July 2015, achieved revenues and a contribution broadly in line
with expectations at the time of acquisition. We expect that
volumes should increase over time as ITP benefits from access
to the Group’s customers, many of whom are showing interest
in ITP’s services.
Customers
Our focus on the UK office services market means that we
deliver at least one of our services to a high proportion of
UK offices including most of the UK’s larger offices. We seek
to utilise this extensive customer base by maintaining and
developing our Group customer relationship management
system, which all sales people across the Group use. This
continues to facilitate cross-selling as most of our customers
have a demand for most of our services and the procurement
person or team is often the same. We regularly conduct an
exercise which shows that our current penetration of customers
in various groupings was:
• 60% of FTSE 100 companies
• 96% of top 25 UK accountancy firms
• 72% of top 100 UK legal firms
• 41% of local authorities in England, Scotland and Wales
• 41% of UK National Health Service trusts.
I believe this represents an excellent indication of the strength
of our business and the opportunity for future development.
Charles Skinner
Chief Executive
Ireland
Sale of Restore
Document
Management
Ireland Limited
As part of the acquisition of Wincanton Records
Management from Wincanton plc in December 2015,
Restore acquired Wincanton’s Irish records management
business, which has two sites in Dublin, and which was
subsequently renamed Restore Document Management
Ireland (RDMI).
In view of Restore’s continued strategic focus on the
UK mainland, and the limited synergies between RDMI
and the company’s UK operations, the Board decided to
dispose of RDMI.
RDMI was sold in March 2016 for €36 million.
19
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Group Finance Director’s statement
Significant levels of restructuring
undertaken to improve operating
margins of acquired businesses
Profit Before Tax
Profit before tax from continuing operations for the year ended
31 December 2015 was £6.1 million (2014: £6.1 million). The key
underlying factors driving the performance compared to the
prior year are:
• Contribution resulting from the performance of businesses
acquired in both periods
• Continued performance improvement
• The adverse impact of higher levels of exceptional costs
as a result of the significant restructuring activity undertaken
in the period.
Exceptional costs of £6.4 million (2014: £3.1 million) largely
reflect double running costs and restructuring undertaken
in acquired businesses. The most significant of these is the
restructuring and integration of Cintas UK which was acquired
in October 2014. The integration of acquired businesses is
essential to enable them to attain the operating margins we
achieve in the core business and the financial return expected
at the point of acquisition. The costs incurred in restructuring
Cintas UK have overall been broadly in line with those
expected at the time of the acquisition; within these costs a
higher proportion than expected has been spent on scanning.
Amortisation of intangible assets for the year was £2.6 million
(2014: £1.9 million) with the increase attributable to the higher
carrying value of intangible assets.
Due to the one-off nature of exceptional costs and the non-
cash element of certain charges, the Directors believe that an
adjusted measure of profit before tax and earnings per share
provides shareholders with a more appropriate representation
of the underlying earnings derived from the Restore Group’s
business. The items adjusted for in arriving at that adjusted
profit before tax are as follows:
Continuing operations
Profit before tax
Share-based payments charge
Exceptional items
Amortisation of intangible assets
Other finance costs
Adjusted profit before tax
2015
£’m
6.1
0.9
6.4
2.6
0.3
16.3
2014
£’m
6.1
1.0
3.1
1.9
(0.1)
12.0
Reconciliation of Reported Operating Profit to
Adjusted Operating Profit and Adjusted EBITDA
Continuing operations
Operating profit
Share-based payments charge
Exceptional items
Amortisation of intangible assets
Adjusted operating profit
Depreciation
Adjusted EBITDA
Earnings Per Share (EPS)
Continuing operations
Basic adjusted earnings
per share (pence)
Basic earnings per share (pence)
2015
£’m
7.7
0.9
6.4
2.6
17.6
2.8
20.4
2014
£’m
6.9
1.0
3.1
1.9
12.9
1.9
14.8
2015
2014
15.6p
7.0p
12.3p
6.4p
Basic adjusted earnings per share are calculated as adjusted
profit for the year less standard tax charge divided by the
weighted average number of shares in issue in the year. Basic
earnings per share reflect the actual tax charge which in 2015
includes the utilisation of £2.0 million of brought forward losses
acquired as part of the Cintas UK acquisition.
Exceptional Costs
Acquisition – transaction costs
Acquisition – box relocation
and transport costs
Restructuring and
redundancy costs
Other exceptional
Total
2015
£’m
0.4
0.1
5.1
0.8
6.4
2014
£’m
0.4
0.4
2.5
(0.2)
3.1
20
Restore plc Report & Accounts 2015 96% increase in net cash inflow from
operations largely driven by reduction
in working capital usage
Interest
Net finance costs amounted to £1.6 million (2014: £0.8 million)
which reflects the increased levels of debt as a result of
acquisition activity. Included within finance cost is a credit of
£0.1 million (2014: £0.1 million) representing the change in fair
value of the interest rate collar.
Taxation
UK Corporation Tax is calculated at 20.25% (2014: 21.5%) of
the estimated assessable profit/(loss) for the year. The UK
Corporation Tax rate reduced on 1 April 2015 to 20%, with a
further reduction to 19% on 1 April 2017 falling further to 18%
on 1 April 2020; accordingly, these rate reductions have been
reflected in the deferred tax balance which forms part of the
statement of financial position.
Statement of Financial Position
Net assets increased to £104.7 million (2014: £67.0 million)
following the six acquisitions and placing of shares. Goodwill
and intangibles at 31 December 2015 were £118.6 million
(2014: £68.9 million).
Property, plant and equipment totalled £37.4 million (2014:
£30.2 million), comprising the freehold underground storage
facilities in Wiltshire, storage racking, vehicles and computer
systems. The development of additional storage space in
the underground facility has continued in 2015 including
exploratory investigations into the viability of a further chamber
in the facility which could lead to increased capacity.
The integration of acquisitions remains the key driver of
exceptional costs. In the period the Group completed six
acquisitions and undertook the bulk of the restructuring of the
Cintas UK and Cannon Confidential businesses.
Transaction costs include the cost of legal and professional fees
incurred as part of the acquisitions made in 2015.
Box relocation and transport costs include the cost of uplifting
boxes to existing facilities and the movement of boxes from
facilities which closed as result of the Cintas UK acquisition.
Restructuring and redundancy costs have increased to
£5.1 million in 2015. As expected at the time of acquisition,
the Cintas UK business has required significant restructuring to
enable it to operate at the margins expected. This has included
a rationalisation of the overhead structure, rationalisation of
the storage property portfolio to enable increased utilisation
and the combination of two scanning businesses to deliver
synergies. Also included in the restructuring and redundancy
costs are the costs from the other acquisitions including:
• The integration of both Crimson and Data Imaging
acquisitions into our scanning and storage operations
• The completion of the integration of Cannon Confidential
into our shredding operations
• The integration of ITP into our Relocation division
• The initial integration costs of the Wincanton acquisition.
Other exceptional costs include £0.6 million in relation to a
seasonal scanning contract. The contract involves scanning
exam papers primarily over a two month period in May and
June each year. Due to technical issues during the process
which had not occurred in previous years, significant additional
costs were required to deliver the contract. Further to the
costs borne directly by the Group further fines and costs were
recharged by the customer. Management believe the root cause
of the technical issues has been identified which will enable the
cost of delivering this contract in future periods to fall in line
with patterns previously experienced. As a result of the one
off nature of these costs and their relative size they have been
shown as exceptional to enable a better understanding of the
underlying trading of the Group during the year.
21
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Group Finance Director’s statement continued
Liquidity Risk
The year end net debt was £60.6 million (2014: £30.9 million),
which consisted of £68.5 million of interest bearing loans
and borrowings plus £1.4 million of overdrafts (note 18),
(2014: £37.0 million of interest bearing loans and borrowings
plus £1.2 million of overdrafts). Net debt is monitored on a
daily basis and banking facilities are reviewed against future
expected cash flow movements to ensure that adequate
facilities are in place.
Finance Cost Risk
The Group pays finance costs on its bank facilities. The bank
facilities finance cost is a variable cost linked to LIBOR plus a
margin. Interest rates are managed through an interest rate
swap. The average finance cost on bank facilities for the Group
in 2015 was 2.7% (2014: 2.7%). The potential exposure to
LIBOR movements is deemed acceptable given the current
and anticipated future levels of debt.
Customer Relationship Risk
The Group has commercial relationships with over 14,000
business customers. Attrition rates are low and relationships are
strong. The largest customer accounts for less than 4% of Group
revenue, with the majority of large customers tied into longer
term contracts. Due to the relatively low revenue concentration
of our largest customers the perceived customer relationship
risk is deemed to be low.
Management
It is likely that changes to members of the senior management
team might impact on the Group’s ability to perform to the
expectations within its strategy. The Board ensures that the
management team is appropriately rewarded for its efforts and
that succession planning is considered.
Legislative
The Group has systems and procedures in place to ensure
compliance with, and to manage the impact of changes in,
Government legislation such as agency worker regulations,
vehicle operating procedures and environmental requirements.
Cash Flow
The net cash inflow from operations increased 96% to
£11.0 million (2014: £5.6 million). The improvement from the
prior year has been driven by:
• A reduction of £3.1 million in working capital usage due
to lower levels of one off acquisition related working
capital movements
• An increase of £1.6 million in non cash depreciation and
amortisation charges in the income statement.
Net working capital usage in the year was £3.0 million which
included movement on property provisions, including the Cintas
UK Charlton property, of £2.1 million. Capital expenditure
totalled £4.0 million (2014: £3.6 million) following the continued
development of additional space in the underground storage
facility, development of storage capacity in other sites and
investment in additional scanning capability.
Net Debt
Net debt at the end of the year was £60.6 million
(2014: £30.9 million) reflecting the additional debt taken on to
fund the acquisition spend of £65.9 million which was partially
funded through a placing of shares raising £32.9 million. As part
of the acquisition of Wincanton’s records management business
the Group refinanced its debt facilities entering into a two bank
club arrangement. Facilities at the end of the period totalled
£100 million (£80 million committed) comprising a £50 million
term loan, £30 million revolving credit facility and a potential
£20 million accordion facility. Total amount drawn against these
facilities at the year end was £68.5 million. Following the sale
of Restore Document Management Ireland Limited for
€36 million (£27.8 million) on 10 March 2016, net debt has
reduced significantly, greatly increasing the funding available
to the Group to continue to deliver its growth strategy.
Principal Risks and Uncertainties
The management of the business and the execution of the
Group’s strategies are subject to a number of risks. The key
business risks affecting the Group are shown below.
Risk Management
The significant financial risks the Group faces have been
considered and policies have been implemented to best deal
with each risk. The three most significant risks are considered
to be liquidity risk, finance cost risk and customer relationship
risk. The Group is primarily based in the United Kingdom so the
direct exposure to exchange risk is considered to be small.
22
Restore plc Report & Accounts 2015 Key Performance Indicators (‘KPIs’)
The Group uses many different KPIs at an operational level which are specific to the business and provide information to
management. At an executive level, a selection of operational KPIs, which allow a relevant and robust review of operational
performance, are considered with operational management on a monthly basis. The Board also relies on KPIs that focus on the
financial performance of the Group.
The table below shows the main KPIs used to manage the Group’s performance during the year.
Key Performance Indicator
Revenue
Adjusted operating profit
Operating cash flow before
financing costs and tax
Bank interest cost
Net debt
2015
£’m
91.9
17.6
11.0
1.2
60.6
2014
£’m Analysis
67.5
12.9
Year-on-year change in revenues analysed by segment (see note 4).
Year-on-year change in adjusted operating profit analysed by
segment (see note 4).
5.6 Operating cash flow generated in 2015 increased due to lower
one of working capital movements compared to 2014.
0.9
30.9
Year-on-year change in cost of Group finance. Finance costs in the
year remained increased as a result of higher levels of net debt.
Year-on-year change in bank debt, which increased to fund the
acquisitions in the year.
The non-financial indicators that are regularly monitored are customer satisfaction and retention as well as staff turnover
ratios. Customer attrition rates are very low, as the business has strong and long-term relationships and a high level of customer
satisfaction. The Group has a strong team of experienced and dedicated staff and staff turnover rates are low.
Adam Councell
Group Finance Director
The strategic report on pages 4 to 23 was approved by the Board of Directors on 24 March 2016 and signed on its behalf by:
Charles Skinner
Chief Executive
Adam Councell
Group Finance Director
23
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Board of Directors
Sir William Wells
Aged 76, Non-Executive Chairman
Charles Skinner
Aged 55, Chief Executive
Charles Skinner was appointed Chief Executive of the
Group on 8 June 2009. Charles was previously Chief Executive
of Johnson Services Group plc and Brandon Hire plc for nine
years, prior to which he was at SG Warburg, 3i plc and editor
of Management Today. Charles has nearly 20 years experience
as Chief Executive of quoted companies in the business-to-
business services sector.
Sir William Wells was appointed Chairman of the Board on 8 June
2009. His career encompasses senior positions in public health,
commercial property, insurance and business services. He was
Managing Partner and then Chairman of Chesterton Chartered
Surveyors for 34 years, where he oversaw their transition from
a private partnership to a listed company. His other experience
includes Non-Executive Director roles with AMP (UK), Henderson
Group plc and Exel plc, which was subsequently acquired by
Deutsche Post. Sir William is Chairman of ADL plc, a care home
provider, CMG plc, a specialist in the care of adults with learning
difficulties, Pure Sports Medicine, a leading provider of specialist
muscular skeletal services, and The Practice Group, a leading
provider of primary and community care across England. He was
the Chairman of the Department of Health’s Commercial Advisory
Board and NHS Appointments Commission.
Stephen Davidson
Aged 60, Non-Executive Director
James Wilde
Aged 62, Non-Executive Director
Stephen Davidson joined the Board on 8 January 2014. He
is Non-Executive Chairman of Datatec Limited and PRS for
Music. Stephen is also Non-Executive Director of Informa plc,
Inmarsat plc and Jaywing plc. In his earlier career Stephen was
Chief Financial Officer then Chief Executive officer of Telewest
Communications plc and Vice Chairman of investment banking
at WestLB Panmure. Stephen has a 1st class honours degree in
mathematics and statistics from the University of Aberdeen.
James Wilde joined the Board on 1 June 2014. He is currently
Non-Executive Chairman of Nirvana Equity Limited, the
holding company of NSL Services Group. He has previously
been Non-Executive Chairman of several support services and
manufacturing businesses, including Deb Group Limited, Zenith
Vehicle Contracts Group Limited, ATPI Limited and Allied Glass
Group Limited. He was on the Board of the Navy Army and Air
Force Institutes (NAAFI) for six years and spent much of his
executive career at Securiguard Group plc and Rentokil Initial
plc, where he was Chief Executive.
24
24
Restore plc Report & Accounts 2015 Adam Councell
Aged 37, Group Finance Director
Adam Councell was appointed Group Finance Director on
18 June 2012. Adam began his career at Whitbread plc in the
accounts department of The Pelican Group restaurant division
before moving to the Milward Brown Precis subsidiary of WPP
plc. He joined Rentokil Initial plc in 2003, where he held a
variety of finance posts including Commercial Director of the
Business and Industry division and Finance Director of Catering
and the combined Catering and Hospitals division. Most
recently, he was Finance Director of the UK Business Services
division, supervising eight businesses with a combined turnover
of £250 million.
Sharon Baylay
Aged 47, Non-Executive Director
Sharon Baylay joined the board on 10 September 2014. She is
a Non-Executive Director of ITE Group plc, the listed organiser
of international trade exhibitions and conferences, and Market
Tech Holdings, the listed company combining real estate assets
with e-commerce. She is also Non-Executive Chairman of Dot
Net Solutions Ltd, a private equity backed Cloud Computing
business. She has previously been Marketing Director and
main Board Director of the BBC, responsible for Marketing
Communications and Audiences, and spent much of her career
at Microsoft where she was Board Director of Microsoft UK and
Regional General Manager of MSN International. Sharon is also
a holder of the FT/Pearson Non-Executive Director Diploma.
25
25
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Directors’ report
The Directors submit their report and the financial statements
of Restore plc for the year ended 31 December 2015.
Restore plc is a public limited company quoted on AIM,
incorporated and domiciled primarily in the United Kingdom
and has no branches outside the UK.
Results
The profit before tax for the year ended 31 December 2015
for continuing operations was £6.1 million (2014: £6.1 million).
Dividends
The Directors recommend a final dividend for the year of
2.2 pence per share payable on 8 July 2016 (2014: 1.6 pence
per share). An interim dividend of 1.0 pence was paid during
the year (2014: 0.8 pence). The estimated final dividend to be
paid is £2.1 million (2014: £1.3 million).
Principal Activities
The principal activities of the Group during the year were that of
Document Management and Relocation.
Business Review and Future Developments
This is dealt with in the Strategic report on pages 16 to 23.
Directors
The following directors have held office during the year:
Sir William Wells (Chairman)
Charles Skinner (Chief Executive)
Adam Councell (Group Finance Director)
Stephen Davidson (Non-Executive Director)
James Wilde (Non-Executive Director)
Sharon Baylay (Non-Executive Director)
Information on Directors’ remuneration, share options, long-
term executive plans, pension contributions and benefits is
set out in the Remuneration Report on pages 30 to 32.
The Company maintains liability insurance for its directors
and officers.
Share Capital
Full details of the authorised and issued share capital of the
Company are set out in note 23 to the financial statements.
Substantial Shareholdings
At 22 March 2016 the Company had been notified of the
following interests amounting to 3% or more of the Company’s
issued share capital:
Hargreave Hale
BlackRock Investment
Management (UK)
Octopus Investments
Old Mutual Global Investors
Slater Investments
Franklin Templeton
Investments (UK)
River & Mercantile Asset
Management
M&G Investments
Number of 5p
ordinary shares
Percentage of
issued share
capital
12,471,328
13.0%
10,304,693
9,278,072
5,958,107
5,807,600
4,210,000
3,639,000
2,911,500
10.7%
9.7%
6.2%
6.1%
4.4%
3.8%
3.0%
Property Values
The Directors are aware that a significant difference may exist
between market and book values, as shown in the Consolidated
Statement of Financial Position at 31 December 2015, for the
Group’s freehold properties, all of which have a market value in
excess of the book value recorded. The Directors believe that
this excess is in the region of £7.4 million.
Employees
The Group’s people are its most important asset. Our policy
is to employ the best people irrespective of race, gender,
nationality, disability or sexual orientation. Consultation with
employees or their representatives occurs at all levels, with
the aim of ensuring their views are taken into account when
decisions are made that are likely to affect their interests.
Disabled Employees
Applications for employment by disabled persons are given full
and fair consideration for all vacancies, having regard to their
particular aptitudes and abilities. In the event of an employee
becoming disabled, every effort is made to retain them in order
that their employment with the Group may continue. It is the
policy of the Group that training, career development and
promotion opportunities should be available to all employees.
Environmental Policy
Maintaining and improving the quality of the environment
in which we live is an important concern for the Group, our
staff, customers, suppliers, sub-contractors and communities
in which we operate. We have adopted high standards of
environmental practices and aim to minimise our impact on the
environment wherever this is practical. In particular, we comply
with, and endeavour to exceed the requirements of all laws and
regulations relating to the environment.
26
Restore plc Report & Accounts 2015 Health and Safety
The Group recognises the importance of maintaining high
standards of health and safety for everyone working within
our business and also for anyone who may be affected by
our business. Health and safety is a particular concern to our
customers. Consequently, both of our business segments have
appointed Health and Safety Officers.
The Group’s operational report to the board on a monthly basis
includes a section on all health and safety matters.
Financial Risk Management
Information in respect of the financial risk management
objectives and policies of the Group, including the policy
for hedging each major type of forecasted transaction for
which hedge accounting is used and the exposure of the
Group to market risk, credit risk, liquidity risk and cash flow
risk is contained in note 3, and detailed in the Group Finance
Director’s statement.
Political and Charitable Donations
Donations of £22,000 were made by the Group for charitable
purposes during the year (2014: £12,000). The Group does not
make political donations.
Statement, as to Disclosure of Information
to Auditors
The Directors in office on 24 March 2016 have confirmed that,
as far as they are aware, there is no relevant audit information
of which the auditor is unaware. Each of the Directors have
confirmed that they have taken all steps that they ought to
have taken as Directors in order to make themselves aware of
any relevant audit information and to establish that it has been
communicated to the auditor.
Annual General Meeting
The notice of the Annual General Meeting to be held on 23 May
2016 is set out on pages 91 to 94.
Post Balance Sheet Events
Details of post balance sheet events are given in note 35 of the
financial statements.
Sarah Waudby
Company Secretary
24 March 2016
27
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information
Corporate governance statement
The policy of the Board is to manage the affairs of the Company having regard to Quoted Company Alliance. The Directors support
the principles underlying these requirements insofar as is appropriate for a group of the size of Restore plc.
The Board of Directors
The Group is led and controlled by a Board comprising two Executive Directors and four Non-Executive Directors.
Board meetings are held on a regular basis and no significant decision is made other than by the Directors.
All Directors participate in the key areas of decision-making, including the appointment of new directors. There is no separate
Nomination Committee due to the current size of the Board. The Board receives timely information on all material aspects of the
Group to enable it to discharge its duties.
All Directors submit themselves for re-election at the Annual General Meeting at regular intervals. The following were Directors
during the year:
Number of Board
meetings attended
during the year ended
31 December 2015
Number of
Audit Committee
meetings attended
during the year ended
31 December 2015
Number of
Remuneration
Committee
meetings attended
during the year ended
31 December 2015
Total 11
Total 2
Total 2
11
11
11
11
11
11
2
2
2
2
2
2
–
–
2
2
2
2
Executive Directors
Charles Skinner
Adam Councell
Non-Executive Directors
Sir William Wells
Stephen Davidson
James Wilde
Sharon Baylay
The Executive Directors are not members of the Audit Committee or Remuneration Committee but may attend the meetings as a
guest of the chair of the committee.
Directors’ Remuneration
The Company has an established Remuneration Committee.
Details of the remuneration of each Director are set out in the Remuneration report on page 30.
Accountability and Audit
The Company has established an Audit Committee comprising the Chairman and Non-Executive Directors who are responsible for
reviewing the scope and results of the audit, its cost effectiveness and the independence and objectivity of the auditor.
Relations with Shareholders
The Chief Executive and the Group Finance Director are the Company’s principal contact for investors, fund managers, the press
and other interested parties. At the Annual General Meeting, investors are given the opportunity to question the entire Board.
28
Restore plc Report & Accounts 2015 Internal Control
The Board acknowledges its responsibility for establishing and monitoring the Group’s systems of internal control. Although
no system of internal control can provide absolute assurance against material mis-statement or loss, the Group’s systems
are designed to provide the Directors with reasonable assurance that problems are identified on a timely basis and dealt
with appropriately.
The key procedures that have been established and which are designed to provide effective control are as follows:
Management structure – The Board meets regularly to discuss all issues affecting the Group.
Investment appraisal – The Group has a clearly defined framework for investment appraisal and approval is required by the Board
where appropriate.
The Board regularly reviews the effectiveness of the systems of internal control and considers the major business risks and the
control environment. No significant control deficiencies have come to light during the year and no weakness in internal financial
control has resulted in any material losses, contingencies or uncertainties which would require disclosure as recommended by the
Turnbull guidance for Directors on reporting on internal financial control.
The Board considers that, in light of the control environment described above, there is no current requirement for a separate
internal audit function. The Board will continue to review the need to put in place an internal audit function.
Going Concern
As more fully explained in note 2, having made appropriate enquiries and having examined the major areas which could affect
the Group’s financial position, the Directors are satisfied that the Group has adequate resources to continue in operation for the
foreseeable future.
29
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Directors’ remuneration report
Remuneration Committee
The Company has an established remuneration committee consisting of the Chairman and the Non-Executive Directors. The
Chairman and Non-Executive Directors are responsible for the consideration and approval of the terms of service, remuneration,
bonuses, share options and other benefits of the other Directors. All decisions made are after giving due consideration to the size
and nature of the business and the importance of retaining and motivating management. The committee will meet at least once a
year and at other times as appropriate.
Directors’ Contracts and Letters of Appointment
The Company’s policy on Executive Directors’ service contracts is that, in line with the best practice provisions of the UK Corporate
Governance code, they are to be terminable by the Company on one year’s or 6 months’ notice.
The Non-Executive Directors do not have service contracts but have letters of appointment.
Executive Directors
Charles Skinner
Adam Councell
Non-Executive Directors
Sir William Wells
Stephen Davidson
James Wilde
Sharon Baylay
Date of contract
Notice period
8 June 2009
1 May 2012
12 months
6 months
Date of Letter
Notice period
8 June 2009
8 January 2014
28 March 2014
12 August 2014
3 months
3 months
3 months
3 months
Directors’ Emoluments
The aggregate emoluments of the Directors of the Company were:
£’000
Executive Directors
Charles Skinner
Adam Councell
Non-Executive Directors
Sir William Wells
Stephen Davidson
James Wilde
Sharon Baylay
Salary
& Fees
Benefits
Pension
costs
Total
2015
Salary
& Fees
Benefits
Pension
Costs
Total
2014
432
181
65
40
35
35
788
4
1
–
–
–
–
5
–
21
–
–
–
–
21
436
203
65
40
35
35
814
402
155
60
35
20
11
683
12
1
–
–
–
–
13
–
17
–
–
–
–
17
414
173
60
35
20
11
713
30
Restore plc Report & Accounts 2015
Directors’ Interests in Shares and Options
The beneficial interests of the Directors who were in office at 31 December 2015 in the shares of the Company, including family
interests were as follows:
Charles Skinner
Adam Councell
Sir William Wells
Stephen Davidson
James Wilde
Sharon Baylay
Number of ordinary shares of
5p each 31 December 2015
Number of ordinary shares of
5p each 31 December 2014
541,415
–
352,553
–
–
–
541,415
–
352,553
–
–
–
As at 24 March 2016 there has been no change in any of the above holdings.
The Directors believe that the success of the Group will depend to a high degree on the future performance of the management
team. The Company has established incentive arrangements which will reward the Directors when shareholder value is created,
thereby aligning the interests of the management directly with those of the shareholders.
Restore Share Option Scheme – 2015 Grants
Employee Share Options
The following options have been granted to employees within the Group during the year.
Date of Grant
15 June 2015
Granted
100,000
Number of ordinary
shares of 5p each
100,000
Exercise
price
271.0p
Date from
which exercisable
Expiry date
15 June 2018
15 June 2025
The share options granted have no performance conditions. See note 29 for details of the grant.
The closing price for Restore shares at 31 December 2015 was 299.0 pence. During the year the market price of the Company’s
ordinary shares ranged between 231.7 pence and 309.5 pence.
The Directors’ interests in the share options schemes are as follows:
Charles Skinner
Sir William Wells
Adam Councell
No share options were exercised by any of the Directors in the year (2014: nil).
Number of ordinary
shares of 5p each
31 December 2015
Number of ordinary
shares of 5p each
31 December 2014
2,699,611
1,053,389
400,000
2,699,611
1,053,389
400,000
31
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Directors’ remuneration report continued
Restore Executive Incentive Plan
The Company has an Executive Incentive Plan (‘EIP’), details of which are given in note 29. The Directors’ interests in the EIP are
as follows:
Number of performance units
31 December 2015
Number of performance units
31 December 2014
66,667
16,667
66,667
16,667
Charles Skinner
Adam Councell
By order of the Board
Stephen Davidson
Chairman of the Remuneration Committee
24 March 2016
32
Restore plc Report & Accounts 2015 Statement of Directors’ responsibilities
The Directors are responsible for preparing the Strategic report and the Directors’ report and the financial statements in
accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and Company financial statements for each financial year. The Directors are
required by the AIM Rules of the London Stock Exchange to prepare Group financial statements in accordance with International
Financial Reporting Standards (‘IFRS’) as adopted by the European Union (‘EU’) and have elected under company law to prepare the
company financial statements also in accordance with IFRS.
The Group financial statements are required by law and IFRS adopted by the EU to present fairly the financial position and
performance of the Group; the Companies Act 2006 provides in relation to such financial statements that references in the relevant
part of that Act to financial statements giving a true and fair view are references to their achieving a fair presentation.
Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Group and the Company and of the profit or loss of the Group for that period.
In preparing each of the Group and Company financial statements, the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and accounting estimates that are reasonable and prudent;
• for the Group and Company financial statements, state whether they have been prepared in accordance with IFRSs
adopted by the EU; and
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and the Company
will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group’s and the
Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and the Company
and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for
safeguarding the assets of the Group and the Company and hence for taking reasonable steps for the prevention and detection of
fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Restore
plc website.
Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation
in other jurisdictions.
33
Restore plc Report & Accounts 2015OverviewStrategic reportGovernanceFinancialsOther information Independent Auditor’s Report to the Members of Restore plc
For the year ended 31 December 2015
We have audited the group and parent company financial statements (‘the financial statements’) on pages 35 to 90. The financial
reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards
(IFRSs) as adopted by the European Union and, as regards the parent company financial statements, as applied in accordance with
the provisions of the Companies Act 2006.
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act
2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to
state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for
the opinions we have formed.
Respective responsibilities of Directors and auditor
As more fully explained in the Directors’ Responsibilities Statement set out on page 33, the directors are responsible for the
preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and
express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and
Ireland). Those standards require us to comply with the Auditing Practices Board’s (APB’s) Ethical Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is provided on the FRC’s website at
http://www.frc.org.uk/auditscopeukprivate
Opinion on financial statements
In our opinion:
• the financial statements give a true and fair view of the state of the group’s and the parent company’s affairs as at 31 December
2015 and of the group’s profit for the year then ended;
• the group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;
• the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European
Union and as applied in accordance with the provisions of the Companies Act 2006; and
• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Strategic Report and the Directors’ Report for the financial year for which the financial
statements are prepared is consistent with the financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if,
in our opinion:
• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received
from branches not visited by us; or
• the parent company financial statements are not in agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
Mark Harwood
(Senior Statutory Auditor)
For and on behalf of RSM UK Audit LLP (formerly Baker Tilly UK Audit LLP)
Chartered Accountants
25 Farringdon Street
London EC4A 4AB
24 March 2016
34
34
Restore plc Report & Accounts 2015 Consolidated statement of comprehensive income
For the year ended 31 December 2015
Year Ended 31 December 2015
Year Ended 31 December 2014
Before
exceptional
items
£’m
Exceptional
items
(note 5)
£’m
After
exceptional
items
£’m
Before
exceptional
items
£’m
Exceptional
items
(note 5)
£’m
After
exceptional
items
£’m
Note
Revenue
Cost of sales
Gross Profit
Administrative expenses
Amortisation of intangible assets
Operating profit
Finance costs
Profit before tax
Income tax (charge)/credit
Profit and total comprehensive income
for the year from continuing operations
Profit from discontinued operations
Attributable to owners of the parent
Earnings per share attributable
to owners of the parent (pence)
4
6
6
13
6
7
8
4
9
91.9
(59.0)
32.9
(16.2)
(2.6)
14.1
(1.6)
12.5
(1.6)
10.9
0.2
11.1
–
–
–
(6.4)
–
(6.4)
–
(6.4)
1.3
(5.1)
–
(5.1)
Total
– Basic
– Diluted
Continuing operations
– Basic
– Diluted
Discounted operations
– Basic
– Diluted
91.9
(59.0)
32.9
(22.6)
(2.6)
7.7
(1.6)
6.1
(0.3)
5.8
0.2
6.0
7.2p
6.8p
7.0p
6.6p
0.2p
0.2p
67.5
(43.8)
23.7
(11.8)
(1.9)
10.0
(0.8)
9.2
(1.8)
7.4
–
7.4
–
–
–
(3.1)
–
(3.1)
–
(3.1)
0.6
(2.5)
–
(2.5)
67.5
(43.8)
23.7
(14.9)
(1.9)
6.9
(0.8)
6.1
(1.2)
4.9
–
4.9
6.4p
6.0p
–
–
–
–
35
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015
Consolidated statement of changes in equity
For the year ended 31 December 2015
Balance at 1 January 2014
Profit for the year
Total comprehensive income for the year
Transactions with owners
Issue of shares during the year
Issue costs
Dividends
Transfers (note 26)
Share-based payments charge
Deferred tax on share-based payments
Balance at 31 December 2014
Balance at 1 January 2015
Profit for the year
Total comprehensive income for the year
Transactions with owners
Issue of shares during the year
Issue costs
Dividends
Transfers (note 26)
Share-based payments charge
Deferred tax on share-based payments
Balance at 31 December 2015
Attributable to owners of the parent
Share
capital
£’m
Share
premium
£’m
3.7
–
–
0.4
–
–
–
–
–
0.4
4.1
4.1
–
–
0.7
–
–
–
–
–
0.7
4.8
21.3
–
–
14.6
(0.6)
–
–
–
–
14.0
35.3
35.3
–
–
33.2
(1.0)
–
–
–
–
32.2
67.5
Other
reserves
£’m
1.9
–
–
–
–
–
(0.3)
1.0
1.2
1.9
3.8
3.8
–
–
–
–
–
(0.1)
0.9
0.1
0.9
4.7
Retained
earnings
£’m
Total
equity
£’m
20.2
4.9
4.9
–
–
(1.6)
0.3
–
–
(1.3)
23.8
23.8
6.0
6.0
–
–
(2.2)
0.1
–
–
(2.1)
27.7
47.1
4.9
4.9
15.0
(0.6)
(1.6)
–
1.0
1.2
15.0
67.0
67.0
6.0
6.0
33.9
(1.0)
(2.2)
–
0.9
0.1
31.7
104.7
36
Restore plc Report & Accounts 2015 Consolidated statement of financial position
For the year ended 31 December 2015
Company registered no. 05169780
ASSETS
Non-current assets
Intangible assets
Property, plant and equipment
Deferred tax asset
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
Assets held directly for sale
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Financial liabilities – borrowings
Other financial liabilities
Current tax liabilities
Provisions
Liabilities associated with assets held for sale
Non-current liabilities
Financial liabilities – borrowings
Other long term liabilities
Other financial liabilities
Deferred tax liability
Provisions
Total liabilities
Net assets
Equity
Share capital
Share premium account
Other reserves
Retained earnings
Equity attributable to the owners of the parent
Note
13
14
22
15
16
20
12
17
18
19
21
12
18
11
19
22
21
23
24
25
26
2015
£’m
118.6
37.4
4.3
160.3
1.7
28.8
8.5
39.0
24.2
223.5
(22.4)
(3.7)
(0.1)
(2.2)
(0.8)
(29.2)
(4.6)
(33.8)
(65.4)
(0.5)
(0.2)
(12.0)
(6.9)
(85.0)
(118.8)
104.7
4.8
67.5
4.7
27.7
104.7
2014
£’m
68.9
30.2
4.2
103.3
0.6
24.7
6.9
32.2
–
135.5
(15.2)
(3.7)
–
(0.6)
(1.0)
(20.5)
–
(20.5)
(34.1)
(1.2)
(0.3)
(6.2)
(6.2)
(48.0)
(68.5)
67.0
4.1
35.3
3.8
23.8
67.0
These financial statements were approved by the Board of Directors and authorised for issue on 24 March 2016 and were signed on
its behalf by:
Charles Skinner
Chief Executive
Adam Councell
Group Finance Director
37
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015
Consolidated statement of cash flows
For the year ended 31 December 2015
Net cash generated from operations
Net finance costs
Income taxes paid
Net cash generated from operating activities
Cash flows from investing activities
Purchase of property, plant and equipment and applications software
Purchase of subsidiary undertakings including acquisition costs,
net of cash acquired
Purchase of trade and assets
Sale of subsidiary
Cash flows used in investing activities
Cash flows from financing activities
Net proceeds from share issues
Dividends paid
Repayment of bank borrowings
Drawdown of revolving credit facility
New bank loans raised
Increase in bank overdrafts
Finance lease repayments
Net cash generated from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at start of year
Cash and cash equivalents at end of year
Cash and cash equivalents shown above comprise:
Cash at bank
Note
27
11
11
20
Year ended
31 December
2015
£’m
Year ended
31 December
2014
£’m
11.0
(1.1)
(0.8)
9.1
(4.0)
(63.9)
(2.0)
–
(69.9)
32.9
(2.2)
(47.0)
28.5
50.0
0.2
–
62.4
1.6
6.9
8.5
8.5
5.6
(0.9)
(1.0)
3.7
(3.6)
(28.9)
–
1.2
(31.3)
14.4
(1.6)
(16.0)
21.9
15.0
0.9
(0.1)
34.5
6.9
–
6.9
6.9
38
Restore plc Report & Accounts 2015
Notes to the Group financial statements
For the year ended 31 December 2015
1 GENERAL INFORMATION
Restore plc and its subsidiaries specifically focus on Document Management and Relocation. The Group primarily operates in the
UK. The Company is a public limited company incorporated and domiciled in the United Kingdom. The address of its primarily
registered office is The Databank, Unit 5, Redhill Distribution Centre, Salbrook Road, Redhill, Surrey RH1 5DY.
The Company is listed on the AIM market.
These Group consolidated financial statements were authorised for issue by the Board of Directors on 24 March 2016.
2 SIGNIFICANT ACCOUNTING POLICIES
Basis of Preparation
The consolidated financial statements of Restore plc have been prepared in accordance with EU endorsed International Financial
Reporting Standards (IFRS), IFRIC interpretations and the Companies Act 2006 applicable to companies reporting under IFRS.
The financial statements have been prepared on a historical cost basis although derivatives are reflected at their fair value. The
preparation of financial statements in conformity with IFRS requires the use of certain accounting estimates. It also requires
management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher
degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial
statements are disclosed later in this note.
The consolidated financial statements are presented in pounds sterling and, unless stated otherwise, shown in pounds million to
one decimal place.
Going Concern
The Group’s business activities, together with the factors likely to affect its future development, performance, financial position,
its cash flows, liquidity position, principal risks and uncertainties affecting the business are set out in the Strategic report on
pages 16 to 23.
The Group meets its day-to-day working capital requirements through its financing facilities which are due to expire in November
2020. Details of the Group’s borrowing facilities are given in note 20 of the financial statements.
The Group’s budgets for 2016 and forecasts for 2017, taking account of reasonably possible changes in trading performance, show
that the Group should be able to operate within the level of its current facility.
The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the
foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the annual financial statements.
Basis of Consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company
(its subsidiaries) made up to 31 December each year. Control is achieved where the Company has the power to govern the financial
and operating policies of an investee entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the Consolidated Statement of Comprehensive
Income from the effective date of acquisition or up to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line
with those used by the Group.
All intra-group transactions, balances, income and expenses are eliminated on consolidation.
The acquisition method of accounting is used to account for the acquisition of subsidiaries by the Group. The cost of an acquisition
is measured as the fair value of the assets given, equity instruments issued, contingent consideration and liabilities incurred
or assumed at the date of exchange. Costs directly attributable to the acquisition are expensed as incurred. Identifiable assets
acquired and liabilities and contingent liabilities assumed in a business combination are initially measured at fair value at the
acquisition date. Provisional fair values are adjusted against goodwill if additional information is obtained within one year of
the acquisition date, about facts or circumstances existing at the acquisition date. Other changes in provisional fair values are
recognised through profit or loss.
39
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Notes to the Group financial statements continued
For the year ended 31 December 2015
2 SIGNIFICANT ACCOUNTING POLICIES CONTINUED
Basis of Consolidation continued
Changes in contingent consideration arising from additional information, obtained within one year of the acquisition date, about
facts or circumstances that existed at the acquisition date are recognised as an adjustment to goodwill.
Other changes in contingent consideration are recognised through profit or loss, unless the contingent consideration is classified as
equity. In such circumstances, changes are recognised within equity.
Segmental Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.
In the opinion of the Directors, the chief operating decision maker is the Board of Restore plc and there are two segments,
Document Management and Relocation, whose reports are reviewed by the Board in order to allocate resources and assess
performance. Segment revenue comprises sales to external customers most of whom are located in the UK. Services are provided
primarily from the UK.
Revenue Recognition
Revenue is measured as the fair value of the consideration received or receivable and represents amounts receivable for goods and
services provided in the normal course of business, net of discounts, VAT, returns, rebates and after eliminating intra-group sales.
The Group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits
will flow to the entity and when specific criteria have been met for each of the Group’s activities as described below.
Sale of services – Document Management
Revenue from Records Management represents amounts billed or due for the storage and retrieval of customers’ files and boxes.
Revenue is recognised on retrieval of documents or time-apportioned for the period for which the documents are stored.
The Group sells scanning and IT services which are provided on a time basis or as a fixed price contract with contract terms ranging
up to three years, in which case revenue is recognised based upon the value of work completed, or revenue may be received on a
contractual basis, either as a fixed proportion of managed costs or other fee mechanism, in which case revenue is recognised once
those contractual conditions have been satisfied, either based on managed costs incurred, on a time basis, or other appropriate
contractual measurement.
The Group provides all round secure document destruction and recycling processes, including the rental and servicing of office
recycling units as well as larger secure waste containers providing a confidential waste destruction process. Revenue is recognised
on a time-apportioned basis in respect of rental and when destruction is complete.
Sale of services – Relocation
Revenue represents amounts in respect of relocation, furniture storage and asset disposal and recycling. Revenue is recognised
based upon the value of the work completed for removals, storage revenue is recognised on a per day basis for the furniture stored
on behalf of its customers and when a disposal is complete.
Interest income
Interest income is accrued on a time basis by reference to the principal outstanding and at the effective interest rate applicable,
which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s
net carrying amount.
Dividend income
Dividend income is recognised when the right to receive payment is established.
40
Restore plc Report & Accounts 2015 Exceptional Items
Exceptional items are those significant items which are separately disclosed by virtue of their size or incidence to enable a full
understanding of the Group’s financial performance. Transactions which may give rise to exceptional items are principally gains
or losses on disposal of investments and subsidiaries, redundancy, integration and other restructuring costs, provisions made in
respect of onerous leases and acquisition costs relating to business combinations.
Goodwill
Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’s interest in the fair value of
identifiable assets and liabilities of a subsidiary, at the date of acquisition. Goodwill is initially recognised as an asset at cost and
is subsequently measured at cost less any accumulated impairment losses. Goodwill which is recognised as an asset is reviewed
for impairment at least annually. Any impairment is recognised immediately in profit or loss and is not subsequently reversed.
For the purposes of impairment testing, goodwill is allocated to each of the Group’s cash-generating units expected to benefit from
the synergies of the combination. Cash-generating units to which goodwill has been allocated are tested for impairment annually,
or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating
unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill
allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.
Intangible Assets
Intangible assets are recognised when they are controlled through contractual or other legal rights, or are separable from the rest
of the business, and their fair value can be reliably measured.
Intangible assets that are regarded as having indefinite useful lives are not amortised. Intangible assets that are regarded as having
limited useful lives are amortised on a straight-line basis over those lives. Assets with indefinite lives are reviewed for impairment
annually and other assets are reviewed for impairment whenever events or circumstances indicate that the carrying amount
may not be recoverable. The recoverable amount is the higher of value in use or fair value less cost to sell. Amortisation and any
impairment write downs are recognised immediately in profit or loss.
Customer relationships
Acquired customer relationships are identified as a separate intangible asset as they are separable and can be reliably measured
by valuation of future cash flows. This valuation also assesses the life of the particular relationship. The life of the relationship is
assessed annually. The life of customer relationships for storage customers was assessed during the year following a review of
historic customer attrition rates and management believe that a 5% rate on average is appropriate extending the life of customer
relationships from 10 to 20 years. All customer relationships are being written off on a straight-line basis and have a remaining life
of 5 to 20 years. The customer lists are considered annually to ensure that this classification is still appropriate.
Trade names
Acquired trade names are identified as a separate intangible asset. The life of the trade name is assessed annually. Trade names are
being written off on a straight-line basis over 10 years, except where the trade names are assessed as having an indefinite life due
to the history of trading and the Group being a market leader in the services provided.
Application software and IT
Acquired computer software licences are capitalised on the basis of the costs incurred to acquire and bring to use the specific
software. These costs are amortised on a straight-line basis over their estimated useful lives (three to five years).
Costs associated with developing or maintaining computer software programmes are recognised as an expense as incurred. Costs
that are directly associated with the development of identifiable and unique software products controlled by the Group, and that
will probably generate economic benefits exceeding costs beyond one year, are recognised as intangible assets.
Computer software development costs recognised as assets are amortised on a straight-line basis over their estimated useful lives
(expected to be up to five years). Residual values and useful lives are reviewed each year.
41
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 2 SIGNIFICANT ACCOUNTING POLICIES CONTINUED
Property, Plant and Equipment
Property, plant and equipment is stated at historical cost, less accumulated depreciation and accumulated impairment losses.
Depreciation is provided on a straight-line basis on all property, plant and equipment, except freehold land.
Freehold and long leasehold buildings
Long leasehold land
Leasehold improvements
Plant and machinery
Racking
Office equipment, fixtures and fittings
Motor vehicles
% per annum
2–5%
over the remaining life of the lease
over the life of the lease
5–50%
5%
10–40%
20–25%
Leased Assets
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating
leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to profit or loss on a
straight-line basis over the period of the lease.
Where property lease contracts contain guaranteed minimum incremental rental payments, the total committed cost is
determined and is amortised on a straight-line basis over the life of the lease. Leases of property, plant and equipment which
transfer substantially all the risks and rewards of ownership to the Group are classified as finance leases. Finance leases are
classified as a financial liability and measured at amortised cost. Finance leases are capitalised at the inception of the lease at the
lower of the fair value of the leased property, plant and equipment and the present value of the minimum lease payments and
depreciated over the period of the lease. The resulting lease obligations are included in liabilities. Lease payments are apportioned
between finance charges and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance
of the liability.
Investments
Loan notes are loans and receivables and measured at amortised cost. Impairment losses are recognised in profit or loss when
there is evidence of impairment. Available for sale investments are non-derivative assets and are initially recognised at fair
value net of any transaction costs and are subsequently carried at fair value. Fair value gains and losses are recognised in other
comprehensive income and are recycled to profit or loss on disposal of the investment. If a fair value for an investment cannot be
reliably measured, due to the variability in the range of reasonable fair value estimates being significant, or the probabilities of the
various estimates within the range not being able to be reasonably assessed, that investment will be carried at cost. An impairment
test is performed annually on the carrying value of the investment. An impairment loss is recognised for the amount by which the
asset’s carrying value exceeds its recoverable amount, when there is objective evidence for impairment including significant or
prolonged decline in fair value below cost.
Investments which are held for the long term and over which management do not exercise significant control are carried at cost.
An impairment review is carried out annually.
Investments Accounted for Using the Equity Method
Investments which are held for the long term, and in which the Group has a participating interest and exercises joint control with
one or more other parties under a contractual arrangement, are treated as joint ventures and accounted for by the equity method.
The Group’s share of the results of investments is included in the Consolidated Income Statement and the Group’s share of net
assets is included in investments in the Statement of Financial Position.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined on a first in first out basis. Net realisable
value is the price at which inventories can be sold in the normal course of business. Provision is made where necessary for
obsolete, slow moving and defective inventories.
Trade and Other Receivables
Trade receivables, classified as loans and receivables in accordance with IAS 39 ‘Financial Instruments: Recognition and
Measurement’, are recorded initially at fair value and subsequently measured at amortised cost. A provision for impairment of
trade receivables is established when there is evidence that the Group will not be able to collect all amounts due according to
the original terms. The amount of the provision is the difference between the assets’ carrying amount and the present value
of future cash flows discounted at the effective interest rate. The movement in the provision is recognised in profit or loss. Any
other receivables are recognised at their initial fair value less an allowance for any doubtful amounts. An allowance is made when
collection of the full amount is no longer considered probable.
42
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 Customer Incentives
Incentives provided to new customers are in the form of either costs borne on behalf of new customers or the provision of
services free of charge. Such incentives are recognised as an asset at amortised cost at the point when the contract is signed
and the costs are incurred, or when the service is provided and are amortised in the income statement over the period of
the contract.
Cash and Cash Equivalents
Cash and cash equivalents as defined for the Consolidated Statement of Cash flows comprise cash in hand, cash held at bank with
immediate access, other short-term investments and bank deposits with maturities of three months or less from the date of inception.
Assets Held For Sale
Assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sale
transaction rather than continuing use. This condition is regarded as met only when a sale is highly probable and the asset (or
disposal group) is available for immediate sale in its present condition. Management must be committed to the sale which should
be expected to qualify for recognition as a completed sale within one year from the date of classification. If this condition is no
longer met and the assets and disposal groups are held for continuing use they are transferred out of assets held for sale in the
current year. Disposal groups are groups of assets, and liabilities directly associated with those assets, that are to be disposed of
together as a group in a single transaction.
Non-current assets and disposal groups classified as held for sale are initially measured at the lower of carrying value and fair value
less costs to sell. At subsequent reporting dates non-current assets (and disposal groups) are measured to the latest estimate of fair
value less costs to sell. As a result of this measurement any impairment is recognised by charging to profit or loss.
Trade Payables
Trade payables, classified as other liabilities in accordance with IAS 39, are recognised initially at fair value and subsequently
measured at amortised cost using the effective interest method. Other payables are stated at amortised cost.
Borrowings
Borrowings are classified as other liabilities in accordance with IAS 39 and are recorded at the fair value of the consideration
received, net of direct transaction costs. Finance charges are accounted for in profit or loss over the term of the instrument using
the effective interest rate method.
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from accounting profit as reported in the
Consolidated Statement of Comprehensive Income because it excludes items of income or expense that are taxable or deductible
in other years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax is calculated
using tax rates that have been enacted or substantively enacted at the reporting date.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets and liabilities
in the financial statements and the corresponding tax bases used in the computation of taxable profit and accounted for using
the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent it is probable that taxable profits will be available against which deductible
temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from the
initial recognition of goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a
transaction that affects neither the tax profits nor the accounting profit.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised
based upon tax rates that have been enacted or substantively enacted at the reporting date. Deferred tax is charged or credited in
profit or loss, except when it relates to items charged or credited directly to other comprehensive income and equity, in which case
the deferred tax is also dealt with in other comprehensive income and equity.
Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable
that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be made. If the
effect is material, provisions are determined by discounting the expected future cash flows at an appropriate pre-tax discount rate.
43
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 2 SIGNIFICANT ACCOUNTING POLICIES CONTINUED
Equity Instruments
Equity instruments issued by the Company are recorded at fair value net of transaction costs.
Share-Based Payments
The Group has applied the requirements of IFRS 2 Share-based Payment.
The Group issues equity-settled share-based payments to certain employees. Equity-settled share-based payments are measured at fair
value at the date of grant. The fair value determined at the grant date of equity-settled share-based payments is expensed on a straight-
line basis over the vesting period, based on the Group’s estimate of shares that will eventually vest. Fair value is measured by use of a
stochastic pricing model. Where employees’ contracts are terminated the options are treated as having been forfeited and accordingly
previous charges are credited back to profit or loss if the option has not yet vested or retained earnings if the option has vested.
Pensions
The Group operates a number of defined contribution pension schemes. Contributions are charged to profit or loss as incurred.
Financial Instruments
Financial assets and financial liabilities are recognised on the Group’s Statement of Financial Position when the Group has become
party to the contractual provisions of the instrument. The Group uses derivative financial instruments such as interest rate caps to
hedge its risks associated with interest rates. Such derivative financial instruments are initially recognised at fair value on the date
on which a derivative contract is entered into and are subsequently re-measured at fair value. Derivatives are carried as assets
when the fair value is positive and as liabilities when the fair value is negative.
Any gains or losses arising from changes in fair value on derivatives during the year that do not qualify for hedge accounting are
taken directly to profit or loss.
Critical Accounting Estimates and Judgements
The preparation of the Group’s financial statements requires management to make judgements, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the
reporting date. However, uncertainty about these assumptions and estimates could result in outcomes that could require a
material adjustment to the carrying amount of the asset or liability affected in the future. The assumptions made in 2014 for the
acquisition of Cintas UK have been reassessed in the year and are shown in note 11 and historic attrition rates experienced by the
group have extended the life of the customer relationships to 20 years.
Judgements
In the process of applying the Group’s accounting policies, management has made the following judgements, apart from those
involving estimates, which have the most significant effect on the amounts recognised in the financial statements.
Acquisitions
The Group has made some significant acquisitions in the year, mainly the acquisition of Wincanton Records Management (note 11).
The assessment of the fair values of the assets and liabilities at acquisition is inherently judgemental and where these are still being
assessed until further information is received, the amounts included in these financial statements are included as provisional. The
key assumptions that have been made are in respect of the valuation of customer relationships.
Exceptional costs
Included within exceptional costs, and as disclosed in note 5, are amounts included in respect of restructuring and reorganisation
and the related duplication of costs. The period taken to complete restructuring varies for each acquisition and management
judgement is applied in determining the level of duplication of costs incurred, particularly in relation to personnel costs where it
can take some time for the optimal levels of staffing to be achieved.
Estimates and assumptions
The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are
discussed below.
Impairment of non-financial assets
The Group assesses whether there are any indicators of impairment for all non-financial assets at each reporting date. Goodwill
and other indefinite life intangibles are tested for impairment annually and at other times when such indicators exist. Other
non-financial assets are tested for impairment when there are indicators that the carrying amounts may not be recoverable.
When value in use calculations are undertaken, management must estimate the expected future cash flows from the asset or cash-
generating unit and choose a suitable discount rate in order to calculate the present value of those cash flows. Further details are
given in note 13.
44
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 Valuation of separable intangibles on acquisition
When valuing the intangibles acquired in a business combination, management estimate the expected future cash flows from the
asset and choose a suitable discount rate in order to calculate the present value of those cash flows. Separable intangibles valued
on acquisitions made in the year were £48.2m (2014: £8.8m) as detailed further in note 11.
Provisions
Included within provisions is an ‘over-renting’ provision which relates to the amount by which future lease rental commitments,
arising as a result of acquisitions, exceed the fair market rentals. In calculating this provision the key estimates are those relating
to the fair values of the rentals on the properties concerned, the impact of future rent reviews and the discount rate applicable.
Adoption of New and Revised Standards
a) New standards, amendments and interpretations issued and effective during the financial year commencing
1 January 2015
Annual Improvements to IFRSs 2011–2013 Cycle
The improvements in this Amendment clarify the requirements of IFRSs and eliminate inconsistencies within and
between Standards.
b) Standards, amendments and interpretations, which are effective for reporting periods beginning after the date
of these financial statements which have not been adopted early:
Annual Improvements to IFRSs 2010–2012 Cycle
The improvements in this Amendment clarify the requirements of IFRSs and eliminate inconsistencies within and between Standards.
Amendments to IAS 19: Defined Benefit Plans: Employee Contributions
The amendments allow fixed contributions to be recognised as a reduction in the service cost in the period in which the employee’s
services are rendered, instead of being attributed to periods of service as a ‘negative benefit’.
Amendments to IAS 1: Disclosure Initiative
Amended to further clarify the concept of materiality, namely that it is applicable to the financial statements as a whole, not just
the primary statements and that it applies to specific disclosures required by an IFRS and, therefore, an entity does not have to
disclose information required by an IFRS if that information would not be material.
Amendments to IAS 16 and IAS 38: Clarification of Acceptable Methods of Depreciation and Amortisation
Clarifies that preparers should not use revenue-based methods to calculate charges for the depreciation or amortisation of items of
property, plant and equipment or intangible assets.
Amendments to IFRS 11: Accounting for Acquisitions of Interests in Joint Operations
Introduces guidance as to how a joint operator should account for the acquisition of an interest in a joint operation in which the
activity of the joint operation constitutes a business, as defined in IFRS 3 Business Combinations. Proposes that a joint operator
should apply the relevant principles for business combinations accounting in IFRS 3 and other relevant IFRSs when accounting for
these acquisitions.
Annual Improvements to IFRSs 2012–2014 Cycle
The improvements in this Amendment clarify the requirements of IFRSs and eliminate inconsistencies within and between Standards.
Amendments to IAS 27: Equity Method in Separate Financial Statements
Restoration of the option to use the equity method to account for investments in subsidiaries, joint ventures and associates in the
entity’s separate financial statements.
IFRS 9: Financial Instruments*
Replacement to IAS 39 and is built on a logical, single classification and measurement approach for financial assets which reflects both
the business model in which they are operated and their cash flow characteristics. Also addresses the so-called ‘own credit’ issue and
includes an improved hedge accounting model to better link the economics of risk management with its accounting treatment.
IFRS 15: Revenue from Contracts with Customers*
Introduces requirements for companies to recognise revenue to depict the transfer of goods or services to customers in amounts
that reflect the consideration to which the company expects to be entitled in exchange for those goods or services. Also results
in enhanced disclosure about revenue and provides or improves guidance for transactions that were not previously addressed
comprehensively and for multiple-element arrangements.
*Not yet endorsed by the EU
45
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 2 SIGNIFICANT ACCOUNTING POLICIES CONTINUED
Adoption of New and Revised Standards continued
IFRS 16: Leases*
The new standard recognises a leased asset and a lease liability for almost all leases and requires them to be accounted for in a
consistent manner. This introduces a single lessee accounting model and eliminates the previous distinction between an operating
lease and a finance lease.
*Not yet endorsed by the EU
The Directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material impact on
the financial statements of the Group when the relevant standards and interpretations come into effect.
3 FINANCIAL RISK MANAGEMENT
The Group’s activities expose it to a variety of financial risks: market risk (including fair value interest rate risk and cash flow interest
rate risk), credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial
markets and seeks to minimise potential adverse effects on the Group’s financial performance.
The Group uses derivative financial instruments to hedge certain risk exposures.
Risk management is carried out centrally under policies approved by the Board of Directors. The Group evaluates and hedges
financial risks. The Board provides written principles for overall risk management.
(a) Market risk
(i) Foreign exchange risk:
The Group operates primarily in the UK and has limited exposure to foreign exchange risk.
(ii) Cash flow and fair value interest rate risk:
The Group’s interest rate risk arises from long-term borrowings. Borrowings issued at variable rates expose the Group to cash flow
interest rate risk. During 2015 and 2014, the Group’s borrowings at variable rates were denominated in the UK pound. The Group
analyses its interest rate exposure using financial modelling. Based on the various scenarios, the Group manages its cash flow interest
rate risk by using interest rate swaps. Such interest rate swaps have the economic effect of converting borrowings from floating
rates to fixed rates at a certain level. Interest rate swaps are an agreement with other parties at quarterly intervals, to exchange the
difference between fixed and floating rate calculated by reference to the notional principal amount as shown in note 20.
(b) Credit risk
Credit risk is managed on a Group basis, except for credit risk relating to accounts receivable balances. Each local entity is
responsible for managing and analysing the credit risk for each of their new clients before standard payment and delivery terms
and conditions are offered. Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits with
banks and financial institutions, as well as credit exposures to retail customers, including outstanding receivables and committed
transactions. The maximum exposure is the carrying amount as disclosed in note 16.
With respect to credit risk arising from the other financial assets of the Group, which comprise cash and cash equivalents, the
Group’s exposure to credit risk arises from default of the counterparty, with a maximum exposure equal to the carrying amount of
these instruments as also shown in note 16.
(c) Liquidity risk
The Group monitors its risk to a shortage of funds using a forecasting model. This model considers the maturity of both its financial
assets and financial liabilities (e.g. accounts receivables, other financial assets) and projected cash flows from operations. The
Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank
loans and finance in order to ensure that there is sufficient cash or working capital facilities to meet the requirements of the Group
for its current business plan. A detailed analysis of the Group’s debt facilities is given in note 20.
46
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 Capital risk management
The Group’s main objective when managing capital is to protect returns to shareholders by ensuring the Group will trade profitably in
the foreseeable future. The Group also aims to maximise its capital structure of debt and equity so as to minimise its cost of capital.
The Group manages its capital with regard to the risks inherent in the business and the sector within which it operates by
monitoring its gearing ratio on a regular basis. The Group considers its capital to include share capital, share premium, other
reserves, retained earnings and net debt as noted below. Net debt includes short and long-term borrowings (including overdrafts)
net of cash and cash equivalents.
No changes were made in the objectives, policies or processes during the years ending 31 December 2015 and 31 December 2014.
The Group’s strategy is to strengthen its capital base in order to sustain the future development of the business.
Debt to Capital Ratio
Total debt
Less: cash and cash equivalents (note 20)
Net debt
Total equity
Debt to capital ratio
2015
£’m
69.1
(8.5)
60.6
104.7
0.6
2014
£’m
37.8
(6.9)
30.9
67.0
0.5
The gearing, during 2015 increased as a result of the additional debt to acquire the businesses in the year (note 11) exceeding the
equity raised (note 23). The Group does not have any externally imposed capital requirements.
Fair value estimation
The fair value of financial instruments is market value.
4 SEGMENTAL ANALYSIS
The Group is organised into two main operating segments, Document Management and Relocation, and incurs head office costs.
Services per segment operate as described in the Strategic report. The vast majority of trading of the Group is undertaken within
the United Kingdom. Segment assets include intangibles, property, plant and equipment, inventories, receivables and operating
cash. Central assets include deferred tax and head office assets. Segment liabilities comprise operating liabilities. Central liabilities
include income tax and deferred tax, corporate borrowings and head office liabilities. Capital expenditure comprises additions
to computer software, property, plant and equipment and includes additions resulting from acquisitions through business
combinations. Segment assets and liabilities are allocated between segments on an actual basis.
Revenue
The revenue from external customers was derived from the Group’s principal activities primarily in the UK (the Company is
domiciled in England) as follows:
Revenue
Segment adjusted operating profit/(loss)
Exceptional items
Share-based payments charge
Amortisation of intangible assets
Operating profit
Finance costs
Profit before tax
Tax charge
Profit after tax
Segment assets
Segment liabilities
Capital expenditure
Depreciation and amortisation
Document
Management
£’m
54.7
15.1
Relocation
£’m
37.2
4.1
Head
Office
£’m
–
(1.6)
183.5
41.0
3.8
4.6
39.7
7.8
0.2
0.8
0.3
70.0
–
–
2015
Total
£’m
91.9
17.6
(6.4)
(0.9)
(2.6)
7.7
(1.6)
6.1
(0.3)
5.8
223.5
118.8
4.0
5.4
47
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 4 SEGMENTAL ANALYSIS CONTINUED
Revenue continued
Revenue
Segment adjusted operating profit/(loss)
Exceptional items
Share-based payments charge
Amortisation of intangible assets
Operating profit
Finance costs
Profit before tax
Tax charge
Profit after tax
Segment assets
Segment liabilities
Capital expenditure
Depreciation and amortisation
Discontinued Operations
Revenue
Operating profit
Profit before tax
Tax charge
Profit for the year from discontinued operations
Document
Management
£’m
37.4
11.5
Relocation
£’m
30.1
3.3
Head
Office
£’m
–
(1.9)
101.1
23.3
3.5
3.2
27.4
7.0
0.1
0.6
7.0
38.2
–
–
2014
Total
£’m
67.5
12.9
(3.1)
(1.0)
(1.9)
6.9
(0.8)
6.1
(1.2)
4.9
135.5
68.5
3.6
3.8
Year ended
31 December
2015
£’m
Year ended
31 December
2014
£’m
0.6
0.2
0.2
–
0.2
–
–
–
–
–
Restore Document Management Ireland Limited (previously Wincanton Ireland) has been shown as a discontinued operation
(note 12). Due to the short period between acquisition and the year end there were no cashflows from discontinued operations.
Major Customers
For the year ended 31 December 2015 no customers individually accounted for more than 4% (2014: 4%) of the Group’s
total revenue.
5 E XCEPTIONAL ITEMS
Acquisition – transaction costs
Acquisition – box relocation and transport costs
Restructuring and redundancy costs
Release of deferred consideration provisions
Additional consideration on sale of Peter Cox
Other exceptional items
Total
48
2015
£’m
0.4
0.1
5.1
–
–
0.8
6.4
2014
£’m
0.4
0.4
2.5
(1.0)
(0.6)
1.4
3.1
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 The integration of acquisitions remains the key driver of exceptional costs. In the period the Group completed six acquisitions and
undertook the bulk of the restructuring of the Cintas UK business. As expected at the time of acquisition the Cintas UK business
has required significant restructuring to enable it to operate at the margins expected. This has included a rationalisation of the
overhead structure, rationalisation of the storage property portfolio to enable increased utilisation and the combination of two
scanning businesses to deliver synergies.
Transaction costs include the cost of legal and professional fees incurred as part of the acquisition.
Box relocation and transport costs include the cost of uplifting boxes to existing facilities and the movement of boxes from facilities
which closed as result of the Cintas UK acquisition.
Restructuring and redundancy costs have increased to £5.1m in 2015. As noted above these primarily relate to the Cintas UK
restructuring but also included are the costs from the other acquisitions including:
• the integration of both Crimson and Data Imaging acquisitions into our scanning and storage operations
• the integrations of ITP into our Relocation division
• the initial integration costs of the Wincanton acquisition.
Other exceptional costs include £0.6 million in relation to a seasonal scanning contract. The contract involves scanning exam papers
primarily over a two month period in May and June each year. Due to technical issues during the process which had not occurred in
previous years significant additional costs were required to deliver the contract. Further to the costs borne directly by the Group fines
and costs were recharged by the customer. Management believe the root cause of the technical issues has been identified which will
enable the cost of delivering this contract in future periods to fall in line with patterns previously experienced. As a result the one off
nature of these costs and their relative size they have been shown as exceptional to enable a better understanding of the underlying
trading of the Group during the period.
6 OPERATING PROFIT
The following items have been included in arriving at operating profit:
Amortisation of intangible assets
Depreciation of property, plant and equipment
Share-based payments charge
Operating leases – plant and machinery
Operating leases – land and buildings
Auditors’ remuneration:
– Parent and consolidated financial statements
– Audit of company’s subsidiaries pursuant to legislation
– Corporate finance services
– Tax compliance services
Expenses by function:
Staff costs (note 30)
Depreciation
Premises costs
Materials
Subcontractors
Selling and distribution expenses
Transport costs
Computer costs
Audit and tax services
Legal and professional
Telecommunication costs
Exceptional items
Other expenses
Total cost of sales and administrative expenses
Amortisation of intangible assets
Total operating costs
2015
£’m
2014
£’m
2.6
2.8
0.9
1.4
6.5
0.1
0.1
0.1
0.1
28.3
2.8
13.2
3.8
13.6
0.4
4.2
1.3
0.3
0.4
0.6
6.4
6.3
81.6
2.6
84.2
1.9
1.9
1.0
1.8
4.5
0.1
0.1
0.1
0.1
20.2
1.9
9.2
3.1
11.2
0.2
3.5
0.8
0.3
0.3
0.4
3.1
4.5
58.7
1.9
60.6
49
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 7 FINANCE COSTS
Interest on bank loans and overdrafts
Amortisation of deferred finance costs
Unwind of discount
Interest rate swap
Exceptional finance costs
Total
2015
£’m
1.2
0.1
0.1
(0.1)
1.3
0.3
1.6
Exceptional finance costs relate to the write off of bank arrangement fees as the facility was replaced during the year.
8 TAXATION
Current tax:
UK corporation tax on profit for the year
Adjustments in respect of previous periods
Total current tax
Deferred tax: (note 22)
Current year
Adjustments in respect of previous periods
Total deferred tax
Total tax charge
2015
£’m
1.0
(0.1)
0.9
(0.2)
(0.4)
(0.6)
0.3
The charge for the year can be reconciled to the profit per the Consolidated Statement of Comprehensive income as follows:
Profit before tax
Profit before tax multiplied by the rate of corporation tax of 20.25% (2014: 21.5%)
Effects of:
Expenses not deductible for tax purposes
Tax losses utilised
Effect of change in rate used for deferred tax
Adjustments in respect of corporation tax for previous periods
Adjustments in respect of deferred tax for previous periods
Tax charge
2015
£’m
6.1
1.2
0.2
(0.6)
–
(0.1)
(0.4)
0.3
2014
£’m
0.9
–
–
(0.1)
0.8
–
0.8
2014
£’m
1.1
0.1
1.2
–
–
–
1.2
2014
£’m
6.1
1.3
0.2
(0.3)
(0.1)
0.1
–
1.2
50
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 9 E ARNINGS PER ORDINARY SHARE
Basic earnings per share have been calculated on the profit for the year after taxation and the weighted average number of
ordinary shares in issue during the year.
Weighted average number of shares in issue
Total profit for the year
Total basic earnings per ordinary share (pence)
Weighted average number of shares in issue
Share options
Executive incentive plan
Weighted average fully diluted number of shares in issue
Total fully diluted earnings per share (pence)
Continuing profit for the year
Continuing basic earnings per share
Continuing fully diluted earnings per share
Discontinued profit for the year
Discontinued basic earnings per share
Discontinued fully diluted earnings per share
2015
2014
83,442,266
76,624,278
£6.0m
7.2p
83,442,266
4,430,077
373,579
£4.9m
6.4p
76,624,278
4,490,487
616,035
88,245,922
81,730,800
6.8p
£5.8m
7.0p
6.6p
£0.2m
0.2p
0.2p
6.0p
£4.9m
6.4p
6.0p
–
–
–
Adjusted earnings per share
The Directors believe that the adjusted earnings per share provide a more appropriate representation of the underlying earnings
derived from the Group’s business. The adjusting items are shown in the table below:
Continuing profit before tax
Adjustments:
Amortisation of intangible assets
Exceptional items
Share-based payments charge
Other finance costs
Adjusted profit for the year
2015
£’m
6.1
2.6
6.4
0.9
0.3
16.3
2014
£’m
6.1
1.9
3.1
1.0
(0.1)
12.0
The adjusted earnings per share, based on the weighted average number of shares in issue during the year, 83.4m (2014: 76.6m) is
calculated below:
Adjusted profit before taxation (£’m)
Tax at 20.25% / 21.5% (£’m)
Adjusted profit after taxation (£’m)
Adjusted basic earnings per share (pence)
Adjusted fully diluted earnings per share (pence)
2015
16.3
(3.3)
13.0
15.6p
14.7p
2014
12.0
(2.6)
9.4
12.3p
11.5p
10 DIVIDENDS
In respect of the current year, the Directors propose a final dividend of 2.2p per share (2014: 1.6p) will be paid to ordinary
shareholders on 8 July 2016. This dividend is subject to approval by shareholders at the Annual General Meeting and has not been
included as a liability in these financial statements. An interim dividend of 1.0p per share (2014: 0.8p) was paid during
the year.
The proposed final dividend for 2015 is payable to all shareholders on the Register of Members on 10 June 2016. The final
estimated dividend to be paid is £2.1m (2014: £1.3m).
51
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 11 BUSINESS COMBINATIONS
On 2 January 2015, the Company acquired the business and assets of Ancora Solutions ('Ancora'), a records management business
for a cash consideration of £0.5m. The fair values are as follows:
Intangible assets – customer relationships
Net assets acquired
Consideration
Satisfied by:
Cash to vendors
Fair value
at acquisition
£’m
0.5
0.5
0.5
0.5
Deferred tax at 18.5% has been provided on the value of intangible assets. Acquisition costs of £10k incurred and have been
charged to profit or loss.
On 6 July 2015, the Company acquired ITP Group Holdings Limited (‘ITP’), the UK’s leading collector of empty printing cartridges.
The acquisition broadens the capabilities of the Group to offer additional office services alongside its existing IT recycling,
document management and office relocation activities. The initial cash consideration was £6.9m, with deferred consideration
of £0.4m paid on 5th January 2016, and a further earn out of £0.4m depending on performance. The provisional fair values are
as follows:
Intangible assets – customer relationships
Property, plant and equipment
Inventories
Trade receivables
Cash
Trade and other payables
Current tax liabilities
Deferred tax liabilities
Net assets acquired
Goodwill
Consideration
Satisfied by:
Cash to vendors
Deferred consideration
Earn out consideration
Provisional
fair value
at acquisition
£’m
1.6
0.1
0.6
1.2
4.1
(1.4)
0.1
(0.3)
6.0
1.7
7.7
6.9
0.4
0.4
Deferred tax at 18.5% has been provided on the value of intangible assets. Acquisition costs of £83k were incurred and have been
charged to profit or loss.
52
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 On 5 August 2015, the Company acquired the business of the Data Imaging and Archiving Company, ‘DIAC’, a document
management company, for cash consideration of £1.5m. The fair values are as follows:
Intangible assets – customer relationships
Deferred tax liabilities
Net assets acquired
Goodwill
Consideration
Satisfied by:
Cash to vendors
Fair value at
acquisition
£’m
1.5
(0.3)
1.2
0.3
1.5
1.5
On 14 August 2015, the Group acquired Crimson UK Limited ('Crimson'), a document scanning business for an initial cash
consideration of £1.0m, a further payment of £0.2m was made on 17 September 2015 following the award of a major contract
and further payments of up to a maximum of £0.5m over five years, dependent on the award and execution of a potential major
contract. At 31 December £0.2m was due after more than one year. The provisional fair values are as follows:
Intangible assets – customer relationships
Property, plant and equipment
Other receivables
Cash
Trade and other payables
Deferred tax liabilities
Net assets acquired
Goodwill
Consideration
Satisfied by:
Cash to vendors
Contingent consideration
Provisional
fair value at
acquisition
£’m
0.5
0.3
0.5
0.1
(0.3)
(0.1)
1.0
0.7
1.7
1.7
1.2
0.5
Deferred tax at 18.5% has been provided on the value of intangible assets. Acquisition costs of £32k were incurred and have been
charged to profit or loss.
53
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 11 BUSINESS COMBINATIONS CONTINUED
On 8 December 2015, the company acquired the records management business of Wincanton plc, ‘WRM’ for consideration of
£40.3m and settlement of existing debt of £17.0m. The acquisition was financed by a placing (note 23) and new debt facilities of
£80.0m (note 20). Acquisition costs of £245k were incurred and charged to profit or loss. The provisional fair values are as follows:
Wincanton UK
Intangible assets – customer relationships
Property, plant and equipment
Trade and other payables
Deferred tax liabilities
Net assets acquired
Goodwill
Consideration
Satisfied by:
Cash to vendors
Settlement of exisitng debt
Wincanton Ireland
Intangible assets – customer relationships
Property, plant and equipment
Trade and other payables
Deferred tax liabilities
Net assets acquired
Goodwill
Consideration
Satisfied by:
Cash to vendors
Cash in escrow
Settlement of existing debt
Provisional
fair value at
acquisition
£’m
27.2
6.3
(2.9)
(5.0)
25.6
14.5
40.1
28.6
11.5
Provisional
fair value at
acquisition
£’m
13.0
3.4
(1.6)
(2.4)
12.4
4.8
17.2
10.1
1.6
5.5
Deferred tax at 18.5% has been provided on the value of intangible assets.
Restore Document Management Ireland Limited (previously Wincanton Ireland) was sold on 10 March 2016, and the assets have
been presented as held for sale (note 12).
54
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 On 17 December 2015, the Company acquired Diamond Relocations Limited, a commercial relocations business, for a cash
consideration of £1.0m and settlement of existing debt of £1.5m.
Property, plant and equipment
Trade receivables
Trade and other payables
Deferred tax liabilities
Net assets acquired
Goodwill
Consideration
Satisfied by:
Cash to vendors
Settlement of existing debt
Provisional
fair value at
acquisition
£’m
2.2
0.1
(0.1)
(0.1)
2.1
0.4
2.5
1.0
1.5
Acquisition costs of £1k were incurred and charged to profit or loss.
Reassessment of previous fair values
On 7 October 2014, the Company acquired 100% of the share capital of Cintas UK Document Management Limited and the
fair value of the assets and liabilities acquired, were included in the 2014 financial statements as provisional amounts. Further
assessments have been made during the year as more information has become available and the fair values recognised on the
acquisition have been finalised. The main changes are the valuation of customer relationships, increasing the value by £3.9m and
adjusting the assumption used in assessing the over-renting provision resulting in an increase of £1.7m. Other changes have been
made to the value acquired assets and liabilities as well as deferred tax resulting in a reduction in goodwill of £0.8m. The final fair
value table is as follows:
Intangible assets – customer relationships
Property, plant and equipment
Deferred tax assets
Inventories
Trade receivables
Other receivables
Cash
Trade and other payables
Deferred tax liabilities
Provisions
Net assets required
Goodwill
Consideration
Satisfied by:
Cash to vendors
Purchase price adjustment
Reimbursement – less than 1 year
Reimbursement – more than 1 year
Fair Value
£’m
10.6
8.0
1.3
0.1
2.0
2.0
2.5
(4.1)
(2.0)
(7.1)
13.3
13.3
26.6
23.5
0.6
1.0
1.5
The reimbursement amounts cover rents to the end of the lease for a site which was acquired as it could not be excluded from
the acquisition and was surplus to requirements. The reimbursement of these costs is separate to the business acquisition. The
amounts are included as a deferred income creditor and are being released against costs incurred and is expected to be used by
2017. At 31 December 2015, £0.3m (2014: £1.2m) was classified as due after more than one year.
55
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 11 BUSINESS COMBINATIONS CONTINUED
Post acquisition results
Revenue
Profit before tax since acquisition
included in the consolidated statement
of comprehensive income
Ancora
£’m
0.5
0.2
ITP
£’m
2.0
0.6
Crimson
UK
£’m
0.5
0.1
Wincanton
UK
£’m
Diamond
£’m
1.3
0.4
–
–
DIAC
£’m
0.8
0.1
If the acquisitions had been completed on the first day of the financial year, the revenue would have been £116.3m and Group
profit before tax would have been £10.3m. As explained in note 5, following acquisition a number of restructuring costs are
incurred, and after this post acquisition restructuring the acquisitions have a positive impact on Group profit before tax.
The goodwill on each acquisition represents the value attributable to new business and the assembled and trained workforce.
The acquisitions of the document management businesses were made to extend national coverage and increase the Group’s
market share.
The acquisition of ITP, broadened the capabilities of the Group to offer additional services alongside its existing services.
The acquisition of Diamond Relocations Limited created an additional relocation site.
12 ASSETS CLASSIFIED AS HELD FOR SALE
The assets and liabilities related to Restore Document Management Ireland Limited (previously Wincanton Ireland) have been
presented as held for sale (note 35).
In addition, a freehold site acquired as part of the acquisition of Diamond Relocations Limited has also been classified as held
for sale.
2015
£’m
17.8
5.6
0.8
24.2
2015
£’m
2.2
2.4
4.6
2014
£’m
–
–
–
–
2014
£’m
–
–
–
Assets classified as held for sale
Intangible assets
Property plant and equipment
Other current assets
Liabilities classified as held for sale
Trade and other payables
Deferred taxation
56
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 13 INTANGIBLE ASSETS
Cost
1 January 2014
Additions – external
Acquisitions
Arising on acquisition of subsidiaries
31 December 2014
Cost
1 January 2015
Additions – external
Disposals
Arising on acquisition of subsidiaries
Transferred to assets held for sale
31 December 2015
Accumulated amortisation and impairment
1 January 2014
Charge for the year
31 December 2014
Accumulated amortisation and impairment
1 January 2015
Charge for the year
Disposals
Transferred to assets held for sale
31 December 2015
Carrying amount
31 December 2015
31 December 2014
1 January 2014
The customer relationships have a remaining life of 5–20 years.
Goodwill
£’m
Customer
relationships
£’m
Trade
names
£’m
Applications
software & IT
£’m
39.4
–
–
19.1
58.5
58.5
–
–
21.6
(4.8)
75.3
10.6
–
10.6
10.6
–
–
–
10.6
64.7
47.9
28.8
13.3
–
–
8.8
22.1
22.1
–
–
48.2
(13.0)
57.3
2.7
1.2
3.9
3.9
1.9
–
(0.1)
5.7
51.6
18.2
10.6
2.0
–
–
–
2.0
2.0
–
–
–
–
2.0
0.7
0.2
0.9
0.9
0.2
–
–
1.1
0.9
1.1
1.3
2.8
0.7
0.3
–
3.8
3.8
0.5
(1.6)
–
–
2.7
1.6
0.5
2.1
2.1
0.5
(1.3)
–
1.3
1.4
1.7
1.2
Total
£’m
57.5
0.7
0.3
27.9
86.4
86.4
0.5
(1.6)
69.8
(17.8)
137.3
15.6
1.9
17.5
17.5
2.6
(1.3)
(0.1)
18.7
118.6
68.9
41.9
57
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 £’m
39.4
3.0
0.6
0.4
0.7
0.1
14.3
58.5
1.7
0.3
0.7
19.3
0.4
(0.8)
(4.8)
75.3
10.6
10.6
64.7
47.9
28.8
13 INTANGIBLE ASSETS CONTINUED
The changes to goodwill during the year were as follows:
Cost
1 January 2014
Acquired – Magnum
Acquired – Relocom
Acquired – Filebase
Acquired – Cannon Confidential
Acquired – Papersafe
Acquired – Cintas UK
31 December 2014
Acquired – ITP
Acquired – DIAC
Acquired – Crimson
Acquired – Wincanton
Acquired – Diamond
Adjusted – Cintas UK
Transferred to assets held for sale
31 December 2015
Accumulated impairment
1 January 2014 and 31 December 2014
31 December 2015
Carrying amount at 31 December 2015
Carrying amount at 31 December 2014
Carrying amount 1 January 2014
58
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 Allocation to cash-generating units
Goodwill and indefinite life intangible assets have been allocated for impairment testing purposes to the following cash-generating units.
The carrying value is as follows:
Document Management
Relocation
Goodwill
Indefinite life intangibles
2015
£’m
57.2
7.5
64.7
2014
£’m
42.5
5.4
47.9
2015
£’m
–
–
–
2014
£’m
2.9
–
2.9
Annual test for impairment
For the purpose of impairment testing, goodwill and other intangibles are allocated to business segments which represent the
lowest level that those assets are monitored for internal management purposes. The recoverable amount of each cash-generating
unit is determined from value-in-use calculations. The calculations use pre tax cash flow projections based on financial budgets
approved by the Directors for year one and cash flow projections for years two and three using growth rates that are considered
to be in line with the general trends in which each cash-generating unit operates. Terminal cash flows are based on these 3 year
projections, assumed to grow perpetually at 1%. In accordance with IAS 36, the growth rates for beyond the forecasted three
years do not exceed the long-term average growth rate for the industry. The key assumptions forming inputs to the cash flows are
in revenues and margins. Revenues for 2016 have been assessed by reference to existing contracts and market volumes. Margins
have been assumed to be consistent with those currently achieved in the Document Management and Relocation divisions. The
forecasts have been discounted at a pre-tax rate of 10.3% (2014: 13.1%). This discount rate was calculated using a pre-tax rate
based on the weighted average cost of capital for the Group. The key assumptions used for the value in use calculations are
as follows:
Revenue growth – average over 3 years
Revenue growth – remainder
Cost growth – employee/overheads, average over 3 years
Document
Management
%
Relocation
%
4
1
4
2
1
1
Sensitivity
The Group has not identified any reasonably possible changes to key assumptions that would cause the carrying value of the
remaining goodwill or intangible to exceed its recoverable amount.
59
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 14 PROPERTY, PLANT AND EQUIPMENT
Freehold and
long leasehold
land & buildings
£’m
Leasehold
improvements
£’m
Racking plant
& machinery
£’m
Office
equipment
fixtures
& fittings
£’m
Motor
vehicles
£’m
Cost
At 1 January 2014
Reclassification
Additions
Acquisitions
31 December 2014
1 January 2015
Additions
Disposals
Acquisitions
Transfer to assets
held for sale
31 December 2015
Accumulated Depreciation
1 January 2014
Reclassification
Charged in the year
31 December 2014
At 1 January 2015
Charged in the year
Disposals
31 December 2015
Net book value
31 December 2015
31 December 2014
1 January 2014
11.1
–
0.4
–
11.5
0.4
–
2.2
(2.2)
11.9
0.7
–
0.1
0.8
0.1
–
0.9
11.0
10.7
10.4
2.5
–
0.6
3.9
7.0
0.8
(1.0)
–
–
6.8
0.9
–
0.3
1.2
0.5
(1.0)
0.7
6.1
5.8
1.6
10.1
0.8
1.2
4.2
16.3
1.7
(1.9)
0.1
–
16.2
3.8
–
1.0
4.8
1.3
(1.9)
4.2
12.0
11.5
6.3
4.1
(1.3)
0.3
0.8
3.9
0.5
(2.5)
9.7
(3.4)
8.2
2.5
(0.5)
0.3
2.3
0.7
(2.5)
0.5
7.7
1.6
1.6
0.5
(0.1)
0.4
0.2
1.0
0.1
(0.4)
0.1
–
0.8
0.3
(0.1)
0.2
0.4
0.2
(0.4)
0.2
0.6
0.6
0.2
Total
£’m
28.3
(0.6)
2.9
9.1
39.7
3.5
(5.8)
12.1
(5.6)
43.9
8.2
(0.6)
1.9
9.5
2.8
(5.8)
6.5
37.4
30.2
20.1
Capital expenditure contracted for but not provided in the financial statements is shown in note 32.
Depreciation is charged to profit or loss as an administrative expense. £nil (2014: £0.2m) of plant and machinery is held under a
finance lease.
60
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 15 INVENTORIES
Finished goods and goods for resale
£1.2m (2014: £0.2m) of inventories were recognised as an expense in cost of sales in the year.
16 TRADE AND OTHER RECEIVABLES
Trade receivables
Less: provision for impairment of trade receivables
Trade receivables – net
Other receivables
Prepayments and accrued income
2015
£’m
1.7
2015
£’m
17.3
(0.1)
17.2
2.7
8.9
28.8
2014
£’m
0.6
2014
£’m
16.5
(0.1)
16.4
1.6
6.7
24.7
The average credit period is 57 days (2014: 74 days). No interest is charged on the trade receivables for the first 30 days from
the date of the invoice. Thereafter, interest may be charged at 2% per annum on the outstanding balance. Trade receivables are
provided for based on estimated irrecoverable amounts, determined by reference to past payment history and the current financial
status of the customers.
Movement in the allowance for impairment
Balance at beginning and end of the year
2015
£’m
0.1
2014
£’m
0.1
In determining the recoverability of the trade receivables, the Group considers any change in the credit quality of the trade
receivable from the date credit was initially granted up to the reporting date. See note 20 for an analysis of trade receivables that
were past due but not impaired.
17 TRADE AND OTHER PAYABLES
Trade payables
Other taxation and social security
Other payables
Accruals and deferred income
2015
£’m
9.0
2.6
1.3
9.5
22.4
2014
£’m
5.8
2.8
0.8
5.8
15.2
Other payables include the fair value of the interest rate swap of £nil (2014: £0.1m), see note 20.
The Group has financial risk management policies in place to ensure that all payables are paid within the credit time frame. Trade
and other payables principally comprise amounts outstanding for trade purchases and ongoing costs. The average credit period for
trade purchases is 70 days (2014: 60 days).
61
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 18 FINANCIAL LIABILITIES – BORROWINGS
Current
Bank loans and overdrafts due within one year
Overdrafts on demand
Bank loans – secured
Deferred financing costs
Non-current
Bank loans – secured
Deferred financing costs
2015
£’m
2014
£’m
1.4
2.5
(0.2)
3.7
66.0
(0.6)
65.4
1.2
2.6
(0.1)
3.7
34.4
(0.3)
34.1
The bank debt is due to Royal Bank of Scotland plc and Barclays Bank plc and is secured by a fixed and floating charge over the
assets of the Group. The interest rate profile and an analysis of borrowings is given in note 20. Under the bank facility the Group is
required to meet quarterly covenant tests in respect of cashflow cover, interest cover and leverage. All tests were met during the
year and the Directors expect to continue to meet these tests.
Analysis of net debt
Cash at bank and in hand
Bank loans and overdrafts due within one year
Bank loans due after one year
19 OTHER FINANCIAL LIABILITIES
Obligations under finance leases – present value of finance lease liabilities
Repayable by instalments:
In less than one year
In two to five years
Over five years
2015
£’m
8.5
(3.7)
(65.4)
(60.6)
2015
£’m
0.3
0.1
0.2
–
0.3
2014
£’m
6.9
(3.7)
(34.1)
(30.9)
2014
£’m
0.3
–
0.1
0.2
0.3
62
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 20 FINANCIAL INSTRUMENTS
The Group’s financial instruments comprise cash, bank and various other receivable and payable balances that arise from its
operations. The main purpose of these financial instruments is to finance the Group’s operations.
Cash and cash equivalents
Cash at bank and in hand
2015
£’m
8.5
2014
£’m
6.9
As at 31 December 2015, trade receivables of £3.3m (2014: £3.3m) were past due but not impaired. These relate to a number of
independent customers with no recent history of default. The ageing analysis of these trade receivables is as follows:
60–90 days
Greater than 90 days
2015
£’m
1.5
1.8
2014
£’m
1.4
1.9
The main financial risks arising from the Group’s financial instruments are interest rate risk and liquidity risk. The Directors review
and agree policies for managing each of these risks. Interest rates are regularly reviewed to ensure competitive rates are paid.
Detailed cash flows are produced on a regular basis to minimise liquidity risks.
Carrying value of financial assets and (liabilities) excluding cash and borrowings
Loans and receivables
Derivatives used for hedging
Financial liabilities measured at amortised cost
2015
£’m
18.5
–
(19.5)
2014
£’m
18.1
(0.1)
(13.5)
Currency and interest rate risk profile of financial liabilities
All bank borrowings are subject to floating interest rates, at LIBOR plus a margin of between 1.35% and 2.35%, depending on the
leverage covenant.
The interest rate risk profile of the Group’s gross borrowings for the year was:
Currency
Sterling at 31 December 2015
Sterling at 31 December 2014
Fixed rate
financial
liabilities
£’m
Floating rate
financial
liabilities
£’m
Subject to
interest rate
collar
£’m
Weighted
average
interest rates
%
–
–
65.6
33.7
3.5
4.5
2.7
2.7
Total
£’m
69.1
38.2
The exposure of Group borrowings to interest rate changes and contractual pricing dates at the end of the year are as follows:
6 months or less
2015
£’m
69.1
2014
£’m
38.2
63
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 20 FINANCIAL INSTRUMENTS CONTINUED
Interest rate sensitivity
At 31 December 2015, if interest rates had been 50 basis points higher and all other variables were held constant, it is estimated
that the Group’s profit before tax would be approximately £0.2m (2014: £0.1m) lower. This is mainly attributable to the Group’s
exposure to interest rates on its variable rate borrowings and is based on the change taking place at the beginning of the financial
year and held constant throughout the year.
The Group’s sensitivity to future interest rates changes has increased during the current year due to the increased debt.
Financial assets recognised in the statement of financial position and interest rate profile
All financial assets are short-term receivables and cash in hand. The cash in hand earns interest based on the variable bank base
rate and is held with Barclays Bank plc.
Maturity of financial liabilities
The maturity profile of the carrying amount of the Group’s financial liabilities (including interest payments), other than short-term
trade payables and accruals which are due within one year was as follows:
Bank
Debt
£’m
3.7
6.0
59.7
69.4
Other
financial
liabilities
£’m
1.6
–
–
1.6
2015
Total
£’m
5.3
6.0
59.7
71.0
Bank
Debt
£’m
1.2
0.1
37.2
38.5
Other
financial
liabilities
£’m
0.4
–
–
0.4
2014
Total
£’m
1.6
0.1
37.2
38.9
Within one year, or on demand
Between one and two years
Between two and five years
Borrowing facilities
The Group has a finance facility with Royal Bank of Scotland plc and Barclays Bank plc. This facility comprises a term loan of £50.0m,
a 5 year revolving credit facility (RCF) of £30.0m, both expiring on 4 November 2020, and an on demand net overdraft facility
of £1.5m (2014: a term loan of £15.0m expiring on 30 June 2016, a 3 year revolving credit facility (RCF) of £3.0m, an on demand
net overdraft facility of £1.5m). An offset facility is in place and on a gross basis, £8.6m of the overdraft facility was unutilised at
31 December 2015 (2014: £7.2m). Details of security are given in note 18. Committed but undrawn borrowing facilities as at 31
December 2015 amounted to £8.6m (2014: £8.3m).
All of the Group’s borrowings are in Sterling.
Fair values of financial assets and financial liabilities
The Group’s financial assets and liabilities bear floating interest rates and are relatively short term in nature. In the opinion of the
Directors the book values of the assets and liabilities equate to their fair value.
Interest rate management
The Group holds two interest rate swaps. The Group exchanges the difference between fixed and floating rate interest amounts
calculated on agreed notional principal amounts. Such contracts enable the Group to mitigate the risk of changing interest rates on
the issued variable rate debt held. The fair value of the interest rate swaps at the year end is as follows:
Between one and two years
Between two and five years
Greater than five years
Average contracted
fixed interest rate
Notional
principal amount
Fair value
2015
%
2.8
–
–
2014
%
2.8
2.8
1.5
2015
£’m
3.5
–
–
2014
£’m
3.3
0.6
–
2015
£’m
–
–
–
2014
£’m
–
(0.1)
–
The interest rate swap of 2.8% was entered into on 13 July 2011, expires on 30 June 2016 and settles on a quarterly basis. The
swap was for £5.0m and decreases on a straight-line basis so that it totals 50% of the original term loan facility. A further swap was
entered into on 13 March 2013 for £1.5m in order to hedge the additional £1.5m term loan, put in place to fund the acquisition
of Harrow Green. Both of these term facilities were repaid in 2014. As the hedge was not designated as effective on inception the
movement in fair value has been taken to profit or loss. The valuation of derivatives is within level 2 of the fair value hierarchy as
the significant inputs to the valuation are observable.
64
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 The hierarchy levels have been defined as follows:
• quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1)
•
inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices)
or indirectly (that is, derived from prices) (Level 2)
•
inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs)
21 PROVISIONS
Onerous lease provisions
1 January
Used during the year
Arising on the acquisition of Cintas UK
31 December
2015
£’m
7.2
(1.1)
1.6
7.7
2014
£’m
2.4
(0.6)
5.4
7.2
The onerous leases provision relates to future payments on onerous leases as required in the lease agreements. £1.3m of costs are
expected to be incurred within one year and the balance over the next 7 years. This provision has been discounted at 8%.
Provisions are analysed as follows:
Current
Non-current
Total
2015
£’m
0.8
6.9
7.7
2014
£’m
1.0
6.2
7.2
The provision arising on the acquisition of Cintas UK, 2015 £5.9m (2014: £5.0m) relates to a number of onerous leases expiring
between March 2015 and March 2030 in relation to paying over market rent. The provision has been discounted at 6% (2014:8%).
22 DEFERRED TAX
Summary of balances
Deferred tax liabilities
Deferred tax asset
Net position at 31 December
The movement in the year in the Group’s net deferred tax position is as follows:
1 January
Charge to profit or loss for the year
Tax credited directly to equity
Acquisitions
Transferred to liabilities held for sale
31 December
2015
£’m
(12.0)
4.3
(7.7)
2015
£’m
(2.0)
0.6
0.1
(8.8)
2.4
(7.7)
2014
£’m
(6.2)
4.2
(2.0)
2014
£’m
(2.5)
–
1.2
(0.7)
–
(2.0)
65
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 22 DEFERRED TAX CONTINUED
The following are the major deferred tax liabilities and assets recognised by the Group and the movements thereon during the year:
Deferred tax liabilities
1 January 2014
(Charge)/credit to income for the year
Acquisitions
31 December 2014
Credit to income for the year
Acquisitions
Transferred to liabilities held for sale
31 December 2015
Deferred tax assets
1 January 2014
(Credit)/charge to income for the year
Acquisitions
Transactions with owners
31 December 2014
(Charge)/credit to income for the year
Acquisitions
Transactions with owners
31 December 2015
Accelerated
capital
allowances
£’m
On intangible
assets
£’m
Properties
£’m
(0.9)
(0.3)
(0.1)
(1.3)
0.1
(0.1)
–
(1.3)
(2.5)
0.3
(1.7)
(3.9)
0.7
(8.9)
2.4
(9.7)
(1.1)
0.1
–
(1.0)
0.1
(0.1)
–
(1.0)
Share-based
payments
£’m
Depreciation in
excess of capital
allowances
£’m
Losses
£’m
Provisions
£’m
1.2
0.2
–
1.2
2.6
(0.1)
–
0.1
2.6
0.3
(0.1)
–
–
0.2
(0.2)
–
–
–
0.1
–
–
–
0.1
0.2
–
–
0.3
0.4
(0.2)
1.1
–
1.3
(0.2)
0.3
–
1.4
Total
£’m
(4.5)
0.1
(1.8)
(6.2)
0.9
(9.1)
2.4
(12.0)
Total
£’m
2.0
(0.1)
1.1
1.2
4.2
(0.3)
0.3
0.1
4.3
A deferred tax asset has been recognised on the share-based payments charge. An amount of £0.1m (2014: £1.2m) has been taken
directly to equity.
A deferred tax asset of £nil (2014: £0.2m) has been recognised on brought forward tax losses due to greater certainty over
recoverability of the asset. A potential deferred tax asset amounting to £0.9m (2014: £1.2m) on tax losses of £4.6m (2014: £5.9m)
has not been recognised due to uncertainty over the recoverability of the asset.
66
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 23 CALLED UP SHARE CAPITAL
Authorised:
199,000,000 ordinary shares of 5p each
Allotted, issued and fully paid:
95,954,760 (2014: 82,213,540) ordinary shares of 5p each
The issued ordinary share capital is as follows:
Date
1 January 2014
3 July 2014 – exercise of share options
18 August 2014 – exercise of share options
7 October 2014 – equity raised to acquire Cintas UK
16 October 2014 – exercise of share options
31 December 2014
23 April 2015 – exercise of share options
10 June 2015 – exercise of share options
16 November 2015 – exercise of share options
8 December 2015 – equity raised to acquire Wincanton
31 December 2015
24 SHARE PREMIUM ACCOUNT
1 January
Premium on shares issued during the year
Share issue costs
31 December
2015
£’m
10.0
4.8
2014
£’m
10.0
4.1
Number of
ordinary shares
74,900,491
Issue price
80,000
20,000
7,090,049
123,000
82,213,540
372,541
256,016
35,739
13,076,924
95,954,760
2015
£’m
35.3
33.2
(1.0)
67.5
83.0p
83.0p
210.0p
32.5p
5.0p
5.0p
5.0p
260.0p
2014
£’m
21.3
14.6
(0.6)
35.3
The Company may use the reserve to reduce a deficit in the retained earnings of the Company from time to time subject to
shareholders and court approval, and the Company may release the reserve upon transferring to a blocked trust bank account a
sum equal to the remaining amount outstanding to non-consenting creditors that existed at the date of the capital reduction.
25 OTHER RESERVES
Share-based payments reserve
1 January
Charge for the year
Deferred tax on share-based payments charge
Transfers*
31 December
2015
£’m
3.8
0.9
0.1
(0.1)
4.7
2014
£'m
1.9
1.0
1.2
(0.3)
3.8
* A net amount of £0.1m has been reclassified from share-based payments reserve to retained earnings in respect of lapsed and exercised options, 2014: £0.3m
(in respect of lapsed and exercised).
The share-based payments reserve comprises charges made to the income statement in respect of share-based payments under
the Group’s equity compensation schemes.
67
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 26 RETAINED EARNINGS
1 January
Profit for the year
Dividends paid
Transfers*
31 December
2015
£’m
23.8
6.0
(2.2)
0.1
27.7
2014
£’m
20.2
4.9
(1.6)
0.3
23.8
* A net amount of £0.1m has been reclassified from share-based payments reserve to retained earnings in respect of lapsed and exercised options (2014: £0.3m).
Retained earnings are the balance of income retained by the Group. Retained earnings may be distributed to shareholders by a
dividend payment.
27 CASH INFLOW FROM OPERATIONS
Profit before tax
Depreciation of property, plant and equipment
Amortisation of intangible assets
Net finance costs
Share-based payments charge
Increase in inventories
Increase in trade and other receivables
Decrease in trade and other payables
Net cash generated from operations
Year ended
31 December
2015
£’m
Year ended
31 December
2014
£’m
6.1
2.8
2.6
1.6
0.9
(0.5)
(1.5)
(1.0)
11.0
6.1
1.9
1.9
0.8
1.0
(0.2)
(2.4)
(3.5)
5.6
28 PENSIONS
The Group operates a number of defined contribution schemes for all qualifying employees. The assets of the schemes are held
separately from those of the Group in funds under the control of trustees. The total cost charged to profit or loss of £0.6m (2014:
£0.3m) represents contributions payable to these schemes by the Group at rates specified in the rules of the plan.
68
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 29 SHARE-BASED PAYMENTS
Share options scheme
The Restore share option scheme was introduced in May 2005. Under the scheme the Remuneration Committee can grant options
over shares in the Company to Directors and employees of the Group. Options are granted at a fixed price equal to the market
price of the shares under option at the date of grant. The contractual life of the option is 10 years. Awards under the scheme are
generally reserved for employees at senior management level and above.
Between 2010 and 2015 the Company made a grant of options to senior management and Directors, on which there are no
performance conditions and which are exercisable within 0–10 years.
Options were valued using a stochastic model. The fair value per option and the assumptions used in the calculation are
as follows:
Grant date
Share price at grant date
Exercise price
Number of employees
Share options granted
Vesting period (years)
Expected volatility
Option life (years)
Expected life (years)
Risk free rate
Expected dividends expressed as a
dividend yield
Fair value per option
15 June
2015
2 December
2014
27 November
2013
21 June
2012
271.0p
271.0p
1
240.0p
240.0p
2
149.5p
149.5p
10
83.0p
83.0p
13
30 July
2011
60.0p
69.5p
1
3 May
2011
53.0p
50.0p
4
16 April
2010
41.0p
32.5p
7
100,000
200,000
675,000
3,422,588
400,000
1,160,000
3,360,000
3
30%
10
6
4.0%
0%
100.3p
3
30%
10
6
4.0%
0%
90.2p
3
30%
10
6
4.0%
0%
55.9p
2
30%
10
6
4.0%
0%
30.4p
2
30%
10
6
4.0%
0%
18.9p
2
30%
10
6
4.0%
0%
21.0p
2
30%
10
6
5.6%
0%
5.0p
The total fair value of options issued in the year was £0.1m (2014: £0.2m). The volatility is measured by calculating the standard
deviation of the natural logarithm of share price movements.
A reconciliation of share option movements over the two years to 31 December 2015 is:
Grant date
Outstanding at 1 January
Granted
Exercised
Lapsed
Outstanding at 31 December
Exercisable at 31 December
2015
Weighted average
exercise price
2014
Weighted average
exercise price
Number
73.1p
7,084,588
271.0p
200,000
51.5p
(223,000)
–
(25,000)
79.0p
60.9p
7,036,588
6,186,588
68.0p
240.0p
36.5p
149.5p
73.1p
59.7p
Number
7,036,588
100,000
(820,000)
–
6,316,588
5,366,588
The options outstanding at 31 December 2015 had an exercise price of between 32.5p and 271.0p and a weighted average
remaining contractual life of 5.9 years (2014: 5.6 years). The weighted average share price at exercise date for options exercised in
the year was 265.7p.
69
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 29 SHARE-BASED PAYMENTS CONTINUED
Executive Incentive Plan (EIP)
The Director's interests in the performance units of the EIP is as follows:
Charles Skinner
Adam Councell
2015
66,667
16,667
2014
66,667
16,667
No payment has been made for the grant of these awards. Performance units will convert into a certain number of ordinary shares
(in the form of nil-cost options) at the end of a three year performance period, provided that the value created for shareholders
is in excess of a hurdle ('Threshold Hurdle') calculated by reference to 10% annualised growth in the market capitalisation of
the Company plus dividend payments minus net shareholder investments, from the start of the performance period being 26
November 2013. Providing the Threshold Hurdle has been achieved by the end of the performance period, participants will be
entitled to receive in aggregate 10% of the value created for shareholders above the hurdle. 50% of the entitlement will vest at the
end of the performance period with 25% at the end of each of the following two years.
The fair value per unit and the assumptions used in the calculation are as follows:
Date of grant
26 November 2013
Share price at
date of grant
(pence)
Exercise price
(pence)
Expected
dividend yield
(%)
Expected
volatility
(%)
Risk-free rate
(%)
Term
(years)
Fair value
per unit
(£)
149.5
–
1.1
37.7
0.7
3
18
30 DIRECTORS AND EMPLOYEES
Staff costs during the year
Wages and salaries
Social security costs
Pension costs
Share-based payments charge
2015
£’m
24.4
2.4
0.6
0.9
28.3
2014
£’m
17.2
1.7
0.3
1.0
20.2
Average monthly number of employees during the year
Number
Number
Directors
Management
Administration
Operatives
No Directors exercised share options during the year.
Total amounts for Directors’ remuneration and other benefits
Emoluments for Directors’ services
Directors’ remuneration shown above included the following amounts in respect of the
highest paid Director:
Salary and benefits
Key management compensation
Short-term employment benefits
Post employment benefits
Share-based payments
2
169
82
886
1,139
2015
£’m
0.8
0.4
2015
£’m
2.2
0.1
1.0
3.3
2
107
66
561
736
2014
£’m
0.7
0.4
2014
£’m
2.3
0.1
1.0
3.4
The key management of the Group are management attending divisional Board meetings within each division.
70
Notes to the Group financial statements continuedFor the year ended 31 December 2015Restore plc Report & Accounts 2015 31 LEASING COMMITMENTS
The Group leases various premises and assets under non-cancellable operating lease agreements of varying terms. The majority of
the lease agreements are renewable at the end of the lease period at market rate.
Land and buildings
Plant and machinery
Future aggregate minimum lease payments under
non-cancellable operating leases
– Within one year
– Within two to five years
– Over five years
2015
£’m
9.4
28.8
48.9
87.1
2014
£’m
5.4
21.6
51.9
78.9
2015
£’m
1.1
2.0
0.2
3.3
The operating leases represent rentals payable by the Group for certain properties, vehicles and equipment.
32 C APITAL COMMITMENTS
Capital expenditure
Contracted for but not provided in the financial statements
2015
£’m
–
2014
£’m
1.0
1.7
2.7
2014
£’m
0.1
33 CONTINGENT LIABILITIES
The Company has entered into a bank cross guarantee with its subsidiaries. The guarantee amounts to £60.6m at
31 December 2015 (2014: £30.9m). The assets of the Company and its subsidiaries are pledged as security for the bank borrowings,
by way of a fixed and floating charge.
34 RELATED PARTY TRANSACTIONS AND CONTROLLING PARTY
The remuneration of key management personnel and details of the Directors’ emoluments are shown in note 30. Dividends of
£14,077 and £13,846 (2014: £11,370 and £7,404) were paid to Charles Skinner and Sir William Wells respectively.
The Directors do not consider there to be a controlling party.
35 POST BALANCE SHEET EVENTS
On 10 March 2016, the Group disposed of Restore Document Management Ireland Limited for €36.0m.
71
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Company statement of changes in equity
For the year ended 31 December 2015
Balance at 1 January 2014
Profit for the year
Total comprehensive income for the year
Transactions with owners
Issue of shares during the year
Issue costs
Dividends
Transfers*
Share-based payments charge
Deferred tax on share-based payments
Balance at 31 December 2014
Balance at 1 January 2015
Loss for the year
Total comprehensive income for the year
Transactions with owners
Issue of shares during the year
Issue costs
Dividends
Transfers*
Acquisition*
Share-based payments charge
Deferred tax on share-based payments
Balance at 31 December 2015
Share
capital
£’m
Share
premium
£’m
3.7
–
–
0.4
–
–
–
–
–
0.4
4.1
4.1
–
–
0.7
–
–
–
–
–
–
0.7
4.8
21.3
–
–
14.6
(0.6)
–
–
–
–
14.0
35.3
35.3
–
–
33.2
(1.0)
–
–
–
–
–
32.2
67.5
Other
reserves
£’m
1.9
–
–
–
–
–
(0.3)
0.9
1.2
1.8
3.7
3.7
–
–
–
–
–
(0.1)
–
0.9
0.1
0.9
4.6
Retained
earnings
£’m
Total
equity
£’m
9.5
2.4
2.4
–
–
(1.6)
0.3
–
–
(1.3)
10.6
10.6
(3.1)
(3.1)
–
–
(2.2)
0.1
7.2
–
–
5.1
12.6
36.4
2.4
2.4
15.0
(0.6)
(1.6)
–
0.9
1.2
14.9
53.7
53.7
(3.1)
(3.1)
33.9
(1.0)
(2.2)
–
7.2
0.9
0.1
38.9
89.5
* A net amount of £0.1m has been reclassified from share-based payments reserve to retained earnings in respect of lapsed and exercised options (2014: £0.3m).
As a result of acquisitions shown in note 36, retained earnings of £7.2m were transferred to the Company (2014: £nil).
72
Restore plc Report & Accounts 2015 Company statement of financial position
As at 31 December 2015
ASSETS
Non-current assets
Intangible assets
Property, plant and equipment
Investments
Deferred tax asset
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
Assets held directly for sale
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Financial liabilities – borrowings
Current tax liabilities
Non-current liabilities
Financial liabilities – borrowings
Other long term liabilities
Deferred tax liability
Provisions
Total liabilities
Net assets
Equity
Share capital
Share premium account
Other reserves
Retained earnings
Equity attributable to the owners of the parent
Note
36
37
38
47
40
41
45
39
42
43
43
44
47
46
48
2015
£’m
43.8
22.3
80.6
2.3
149.0
0.2
19.9
3.9
24.0
17.2
190.2
(12.5)
(2.3)
(2.1)
(16.9)
(65.4)
(15.2)
(3.1)
(0.1)
(83.8)
(100.7)
89.5
4.8
67.5
4.6
12.6
89.5
2014
£’m
21.7
13.1
53.6
2.2
90.6
0.1
22.2
2.7
25.0
–
115.6
(6.1)
(2.5)
(0.5)
(9.1)
(34.1)
(17.4)
(1.2)
(0.1)
(52.8)
(61.9)
53.7
4.1
35.3
3.7
10.6
53.7
These financial statements were approved by the Board of Directors and authorised for issue on 24 March 2016 and were signed on
its behalf by:
Charles Skinner
Chief Executive
Adam Councell
Group Finance Director
73
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015
Company statement of cash flows
For the year ended 31 December 2015
Net cash generated (used by) from operations
Net finance costs
Income taxes paid
Net cash generated from operating activities
Cash flows from investing activities
Purchase of property, plant and equipment and applications software
Purchase of subsidiary undertakings including acquisition costs,
net of cash acquired
Purchase of trade and assets
Sale of subsidiary
Cash flows used in investing activities
Cash flows from financing activities
Net proceeds from share issues
Dividends paid
Repayment of bank borrowings
Drawdown of revolving credit facility
New bank loans raised
Decrease in bank overdrafts
Net cash generated from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at start of year
Cash and cash equivalents at end of year
Cash and cash equivalents shown above comprise:
Cash at bank
Year ended
31 December
2015
£’m
Year ended
31 December
2014
£’m
11.8
(1.1)
(0.8)
9.9
(2.3)
(66.6)
(2.0)
–
(70.9)
32.9
(2.2)
(47.0)
28.5
50.0
–
62.2
1.2
2.7
3.9
3.9
0.6
(0.8)
(0.8)
(1.0)
(1.6)
(30.8)
–
1.2
(31.2)
14.4
(1.6)
(15.7)
21.9
15.0
(0.1)
33.9
1.7
1.0
2.7
2.7
Note
49
45
74
Restore plc Report & Accounts 2015 Company accounting policies
These Financial Statements for the Company have been prepared under the historical cost convention and in accordance with
the Companies Act 2006 and EU endorsed International Financial Reporting Standards (IFRS). The Directors consider that the
accounting policies as shown on pages 39 to 46 are suitable, are supported by reasonable judgements and estimates and have
been consistently applied except where stated below. A summary of the more important accounting policies is set out below.
FIRST TIME ADOPTION OF IFRS
These financial statements are the first financial statements of restore plc prepared in accordance with International Financial
Reporting Standards (IFRS). The financial statements of Restore plc for the year ended 31 December 2014 were prepared in
accordance with UK GAAP.
Some of the IFRS recognition, measurement, presentation and disclosure requirements and accounting policy choices differ
from UK GAAP. Consequently, the directors have amended certain accounting policies to comply with IFRS. The directors have
also taken advantage of certain exemptions from the requirements of IFRS permitted by IFRS 1.
Comparative figures have been restated to reflect the adjustments made, except to the extent that the directors have taken
advantage of exemptions to retrospective application of IFRS permitted by IFRS 1. Adjustments are recognised directly in retained
earnings at the transition date.
GOING CONCERN
The going concern basis has been applied in these accounts on the basis that funds will be made available from other
group companies.
The going concern position is discussed further in the consolidated financial statements of the Group on page 39 and applies to
the Company.
COMPANY PROFIT AND LOSS ACCOUNT
In accordance with section 408 of the Companies Act 2006 the Company is exempt from the requirement to present its own
profit and loss account. The results for the financial year of the Company are given on page 72 of the financial statements.
75
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015
Notes to the Company financial statements
For the year ended 31 December 2015
36 INTANGIBLE ASSETS
Cost
1 January 2014
Additions – external
Acquisitions
Arising on acquisition
31 December 2014
Cost
1 January 2015
Additions – external
Transfer from subsidiaries
Disposals
Arising on acquisition
31 December 2015
Accumulated amortisation and impairment
1 January 2014
Charge for the year
31 December 2014
Accumulated amortisation and impairment
1 January 2015
Charge for the year
Disposals
31 December 2015
Carrying amount
31 December 2015
31 December 2014
1 January 2014
Goodwill
£’m
Customer
Relationships
£’m
Applications
Software & IT
£’m
20.3
–
–
2.6
22.9
22.9
–
–
–
10.5
33.4
3.1
0.7
3.8
3.8
–
–
3.8
29.6
19.1
17.2
–
–
–
1.8
1.8
1.8
–
–
–
12.1
13.9
–
0.1
0.1
0.1
0.5
–
0.6
13.3
1.7
–
1.3
0.3
0.1
–
1.7
1.7
0.3
0.2
(0.5)
–
1.7
0.4
0.4
0.8
0.8
0.3
(0.3)
0.8
0.9
0.9
0.9
Total
£’m
21.6
0.3
0.1
4.4
26.4
26.4
0.3
0.2
(0.5)
22.6
49.0
3.5
1.2
4.7
4.7
0.8
(0.3)
5.2
43.8
21.7
18.1
Customer relationships have a life of 5–20 years. Amortisation is charged to profit or loss as an administrative expense.
76
Restore plc Report & Accounts 2015 The changes to goodwill during the year were as follows:
Cost
1 January 2014
Acquired – Magnum
31 December 2014
Acquired – Wansdyke Security
Acquired – Filebase
Acquired – Restore Scan
Acquired – DIAC
31 December 2015
Accumulated impairment
1 January 2014
31 December 2014
31 December 2015
Carrying amount at 31 December 2015
Carrying amount at 31 December 2014
Carrying amount 1 January 2014
£’m
20.3
2.6
22.9
6.0
0.2
4.5
(0.2)
33.4
3.1
3.8
3.8
29.6
19.1
17.2
Annual test for impairment
The recoverable amount of the Company is determined from value-in-use calculations. The calculations use pre tax cash flow
projections based on financial budgets approved by the Directors for year one and cash flow projections for years two and three
using growth rates that are considered to be in line with the general trends in which the Company operates. Terminal cash flows are
based on these 3 year projections, assumed to grow perpetually at 1%. In accordance with IAS 36, the growth rates for beyond the
forecasted three years do not exceed the long-term average growth rate for the industry. The key assumptions forming inputs to
the cash flows are in revenues and margins. Revenues for 2016 have been assessed by reference to existing contracts and market
volumes. Margins have been assumed to be consistent with those currently achieved in the Document Management division. The
forecasts have been discounted at a pre-tax rate of 10.3% (2014: 13.1%). This discount rate was calculated using a pre-tax rate
based on the weighted average cost of capital for the Company.
The key assumptions used for the value in use calculations are as follows:
Revenue growth – average over 3 years
Revenue growth – remainder
Cost growth – employee/overheads, average over 3 years
Document
Management
%
4
1
4
Sensitivity
The Company has not identified any reasonably possible changes to key assumptions that would cause the carrying value of the
remaining goodwill or intangible to exceed its recoverable amount.
77
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Notes to the Company financial statements continued
For the year ended 31 December 2015
37 PROPERTY, PLANT AND EQUIPMENT
Freehold and
long leasehold
land &
buildings
£’m
Leasehold
improvements
£’m
Racking plant
& machinery
£’m
Office
equipment
fixtures &
fittings
£’m
Motor vehicles
£’m
Cost
At 1 January 2014
Reclassification
Additions
Acquisitions
31 December 2014
1 January 2015
Additions
Disposals
Acquisitions
31 December 2015
Accumulated depreciation
1 January 2014
Charged in the year
31 December 2014
At 1 January 2015
Charged in the year
Disposals
31 December 2015
Net book value
31 December 2015
31 December 2014
1 January 2014
5.0
–
–
0.3
5.3
0.4
–
–
5.7
0.1
–
0.1
0.1
–
0.2
5.5
5.2
4.9
1.2
–
0.3
0.2
1.7
0.5
–
3.8
6.0
0.2
0.1
0.3
0.5
–
0.8
5.2
1.4
1.0
3.6
1.9
0.9
0.6
7.0
0.9
–
5.0
12.9
0.4
0.5
0.9
1.0
–
1.9
11.0
6.1
3.2
2.2
(1.9)
0.1
0.1
0.5
0.2
(0.1)
0.2
0.8
–
0.2
0.2
0.2
(0.1)
0.3
0.5
0.3
2.2
0.1
–
–
–
0.1
–
(0.1)
0.1
0.1
–
–
–
0.1
(0.1)
–
0.1
0.1
0.1
Total
£’m
12.1
–
1.3
1.2
14.6
2.0
(0.2)
9.1
25.5
0.7
0.8
1.5
1.9
(0.2)
3.2
22.3
13.1
11.4
Capital expenditure contracted for but not provided in the financial statements is shown in note 52.
Depreciation is charged to profit or loss as an administrative expense. £nil (2014: £0.1m) of plant and machinery is held under a
finance lease.
78
Restore plc Report & Accounts 2015 38 INVESTMENTS
Shares in subsidiary undertakings
Cost
1 January 2014
Acquired – Magnum
Acquired – Filebase
Acquired – Papersafe
Acquired – Cintas UK
Capital Contribution – subsidiary share-based payments
Transfer to intangible assets (less deferred taxation)
31 December 2014
1 January 2015
Adjusted – Shred
Acquired – ITP
Acquired – DIAC
Acquired – Wincanton
Acquired – Diamond
Capital contribution – subsidiary share-based payment
Transfer to intangible assets (less deferred tax)
Transferred to assets held for sale (note 39)
31 December 2015
Provision for impairment
At 1 January 2014 and 31 December 2014
Charge for the year
31 December 2015
Net book value
31 December 2015
31 December 2014
1 January 2014
£’m
55.1
3.2
0.4
0.2
26.6
0.1
(3.2)
82.4
0.3
7.7
0.7
57.3
2.5
0.1
(19.4)
(17.2)
114.4
28.8
5.0
33.8
80.6
53.6
26.3
79
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Notes to the Company financial statements continued
For the year ended 31 December 2015
38 INVESTMENTS CONTINUED
At 31 December 2015 the Company held directly and indirectly equity and voting rights of the following undertakings:
Company
Document Management Division
*Restore (Spur) Limited**
*Restore Document Management
Ireland Limited**
*Restore Shred Limited**
*Restore Scan Limited**
* Magnum Secure Limited**
*Stapledon Holdings Limited**
*Wansdyke Security Limited
Document Control Services Limited
*File and Data Storage Limited
Magnum Docstore Limited
*Filebase Limited
Preview Services Limited
Keymorr imaging Services Limited
Crimson UK Limited
AARMS Limited
*Sargents Trading Limited
Relocation Division
*Harrow Green Limited
Relocom Limited**
*Diamond Relocations Limited**
*IT Efficient Limited**
*ITP Group Holdings Limited**
International technology products (UK)
Limited**
International technology products GmbH**
Office Green Limited**
Takeback Limited**
* Held directly
Class of
holding
% held
Country of
incorporation
Nature of
business
Ordinary
100%
England and Wales
Records Management
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
83%
100%
100%
100%
100%
100%
100%
100%
Ireland
Records Management
England and Wales
Shredding Services
England and Wales
Document Scanning
England and Wales
Holding Company
England and Wales
Holding Company
England and Wales
England and Wales
England and Wales
England and Wales
England and Wales
England and Wales
England and Wales
England and Wales
England and Wales
England and Wales
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
England and Wales
England and Wales
England and Wales
Relocations
Relocations
Relocations
England and Wales
IT Asset Disposal
England and Wales
Holding Company
England and Wales
Printer Cartridge Recycling
Germany
Printer Cartridge Recycling
England and Wales
Printer Cartridge Recycling
England and Wales
Printer Cartridge Recycling
** The Company has taken the exemption from audit under section 479A of the Companies Act 2006.
Dormant companies are exempt from filing accounts under section 394 of the Companies Act 2006.
80
Restore plc Report & Accounts 2015 39 ASSETS CLASSIFIED AS HELD FOR SALE
The assets related to Restore Document Management Ireland Limited (previously Wincanton Ireland) have been presented as held
for sale (note 55).
Assets classified as held for sale
Investments
40 INVENTORIES
Finished goods and goods for resale
£0.1m (2014: £nil) of inventories were recognised as an expense in cost of sales on the year.
41 TRADE AND OTHER RECEIVABLES
Due in less than one year
Trade receivables
Less: provision for impairment of trade receivables
Trade receivables – net
Amounts due from group undertakings
Other receivables
Prepayments and accrued income
Due after more than one year
Amounts due from group undertakings
Total
2015
£’m
17.2
2015
£’m
0.2
2015
£’m
8.4
(0.1)
8.3
2.5
0.1
4.9
15.8
4.1
19.9
2014
£’m
–
2014
£’m
0.1
2014
£’m
5.1
(0.1)
5.0
0.4
0.1
2.9
8.4
13.8
22.2
The average credit period is 62 days (2014: 67 days). No interest is charged on the trade receivables for the first 30 days from
the date of the invoice. Thereafter, interest may be charged at 2% per annum on the outstanding balance. Trade receivables are
provided for based on estimated irrecoverable amounts, determined by reference to past payment history and the current financial
status of the customers.
Movement in the allowance for impairment
Balance at beginning and end of the year
2015
£’m
0.1
2014
£’m
0.1
In determining the recoverability of the trade receivables, the Company considers any change in the credit quality of the trade
receivable from the date credit was initially granted up to the reporting date. See note 45 for an analysis of trade receivables that
were past due but not impaired.
42 TRADE AND OTHER PAYABLES
Trade payables
Amount due to group undertakings
Other taxation and social security
Other payables
Accruals and deferred income
2015
£’m
4.9
1.4
1.3
1.0
3.9
12.5
2014
£’m
2.0
0.3
1.2
0.7
1.9
6.1
Other payables include the fair value of the interest rate swap of £nil (2014: £0.1m), see note 45.
The Company has financial risk management policies in place to ensure that all payables are paid within the credit time frame.
Trade and other payables principally comprise amounts outstanding for trade purchases and ongoing costs. The average credit
period for trade purchases is 95 days (2014: 71 days).
81
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Notes to the Company financial statements continued
For the year ended 31 December 2015
43 FINANCIAL LIABILITIES – BORROWINGS
Current
Bank loans and overdrafts due within one year
Bank loans – secured
Deferred financing costs
Non-current
Bank loans – secured
Deferred financing costs
2015
£’m
2.5
(0.2)
2.3
66.0
(0.6)
65.4
2014
£’m
2.6
(0.1)
2.5
34.4
(0.3)
34.1
The bank debt is due to Royal Bank of Scotland plc and Barclays Bank plc and is secured by a fixed and floating charge over the
assets of the Group. The interest rate profile and an analysis of borrowings is given in note 45. Under the bank facility the Group is
required to meet quarterly covenant tests in respect of cashflow cover, interest cover and leverage. All tests were met during the
year and the Directors expect to continue to meet these tests.
Analysis of net debt
Cash at bank and in hand
Bank loans and overdrafts due within one year
Bank loans due after one year
44 OTHER FINANCIAL LIABILITIES
Amounts due to group undertakings
Other long term liabilities
2015
£’m
3.9
(2.3)
(65.4)
(63.8)
2015
£’m
14.8
0.4
15.2
2014
£’m
2.7
(2.5)
(34.1)
(33.9)
2014
£’m
17.4
–
17.4
45 FINANCIAL INSTRUMENTS
The Company’s financial instruments comprise cash, bank and various other receivable and payable balances that arise from its
operations. The main purpose of these financial instruments is to finance the Company operations.
Cash and cash equivalents
Cash at bank and in hand
2015
£’m
3.9
2014
£’m
2.7
As at 31 December 2015, trade receivables of £1.3m (2014: £1.2m) were past due but not impaired. These relate to a number of
independent customers with no recent history of default. The ageing analysis of these trade receivables is as follows:
60–90 days
Greater than 90 days
82
2015
£’m
0.5
0.8
2014
£’m
0.4
0.8
Restore plc Report & Accounts 2015
The main financial risks arising from the Company’s financial instruments are interest rate risk and liquidity risk. The Directors
review and agree policies for managing each of these risks. Interest rates are regularly reviewed to ensure competitive rates are
paid. Detailed cash flows are produced on a regular basis to minimise liquidity risks.
Carrying value of financial assets and (liabilities) excluding cash and borrowings
Loans and receivables
Derivatives used for hedging
Financial liabilities measured at amortised cost
2015
£’m
10.7
–
(11.2)
2014
£’m
5.4
(0.1)
(4.8)
Currency and interest rate risk profile of financial liabilities
All bank borrowings are subject to floating interest rates, at LIBOR plus a margin of between 1.35% and 2.35%, depending on the
leverage covenant.
The interest rate risk profile of the Company’s gross borrowings for the year was:
Currency
Sterling at 31 December 2015
Sterling at 31 December 2014
Fixed rate
financial
liabilities
£’m
Floating rate
financial
liabilities
£’m
Subject to
interest rate
collar
£’m
Weighted
average interest
rates
%
–
–
64.2
32.1
3.5
4.5
2.7
2.6
Total
£’m
67.7
36.6
The exposure of Company’s borrowings to interest rate changes and contractual pricing dates at the end of the year are as follows:
6 months or less
2015
£’m
67.7
2014
£’m
36.6
Interest rate sensitivity
At 31 December 2015, if interest rates had been 50 basis points higher and all other variables were held constant, it is estimated
that the Company’s loss before tax would be approximately £0.2m higher (2014: profit £0.1m lower). This is mainly attributable to
the Company’s exposure to interest rates on its variable rate borrowings and is based on the change taking place at the beginning
of the financial year and held constant throughout the year.
The Company’s sensitivity to future interest rates changes has increased during the current year due to the increased debt.
Financial assets recognised in the statement of financial position and interest rate profile.
All financial assets are short-term receivables and cash in hand. The cash in hand earns interest based on the variable bank base
rate and is held with Barclays Bank plc.
83
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Notes to the Company financial statements continued
For the year ended 31 December 2015
45 FINANCIAL INSTRUMENTS CONTINUED
Maturity of financial liabilities
The maturity profile of the carrying amount of the Company’s financial liabilities (including interest payments), other than short-
term trade payables and accruals which are due within one year was as follows:
Within one year, or on demand
Between one and two years
Between two and five years
Bank
Debt
£’m
2.3
6.0
60.2
68.5
Other
financial
liabilities
£’m
1.6
–
–
1.6
2015
Total
£’m
3.9
6.0
60.2
70.1
Bank
Debt
£’m
–
–
36.6
36.6
Other
financial
liabilities
£’m
0.1
–
–
–
2014
Total
£’m
0.1
–
36.6
36.7
Borrowing facilities
The Company has a finance facility with Royal Bank of Scotland plc and Barclays Bank plc. This facility comprises a term loan of
£50.0m, a 5 year revolving credit facility (RCF) of £30.0m, expiring on 4 November 2020, and an on demand net overdraft facility
of £1.5m (2014: a term loan of £15.0m expiring on 30 June 2016, a 3 year revolving credit facility (RCF) of £3.0m, an on demand
net overdraft facility of £1.5m. An offset facility is in place and on a gross basis, £1.8m of the overdraft facility was unutilised
at 31 December 2015 (2014: £7.2m). Details of security are given in note 43. Committed but undrawn borrowing facilities as at
31 December 2015 amounted to £8.6m (2014: £8.3m).
All of the Company’s borrowings are in Sterling.
Fair values of financial assets and financial liabilities
The Company’s financial assets and liabilities bear floating interest rates and are relatively short term in nature. In the opinion
of the Directors the book values of the assets and liabilities equate to their fair value.
Interest rate management
The Company holds two interest rate swaps. The Company exchanges the difference between fixed and floating rate interest
amounts calculated on agreed notional principal amounts. Such contracts enable the Company to mitigate the risk of changing
interest rates on the issued variable rate debt held. The fair value of the interest rate swaps at the year end is as follows:
Between one and two years
Between two and five years
Greater than five years
Average contracted fixed
interest rate
Notional
principal amount
Fair
value
2015
%
2.8
–
–
2014
%
2.8
2.8
1.5
2015
%
3.5
–
–
2014
%
3.3
0.6
–
2015
%
–
–
–
2014
%
–
(0.1)
–
The interest rate swap of 2.8% was entered into on 13 July 2011, expires on 30 June 2016 and settles on a quarterly basis. The
swap was for £5.0m and decreases on a straight line basis so that it totals 50% of the original term loan facility. A further swap was
entered into on 13 March 2013 for £1.5m in order to hedge the additional £1.5m term loan, put in place to fund the acquisition
of Harrow Green. Both of these term facilities were repaid in 2014. As the hedge was not designated as effective on inception the
movement in fair value has been taken to profit or loss. The valuation of derivatives is within level 2 of the fair value hierarchy as
the significant inputs to the valuation are observable.
The hierarchy levels have been defined as follows:
• quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1)
•
inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices)
or indirectly (that is, derived from prices) (Level 2)
•
inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs).
84
Restore plc Report & Accounts 2015 46 PROVISIONS
Onerous lease provisions
1 January
Used during the year
31 December
Provisions are analysed as follows:
Non–current
Total
47 DEFERRED TAX
Summary of balances
Deferred tax liabilities
Deferred tax asset
Net position at 31 December
The movement in the year in the Company’s net deferred tax position is as follows:
1 January
Credit/(charge) to profit or loss for the year
Tax credited directly to equity
Acquisitions
31 December
2015
£’m
0.1
–
0.1
2015
£’m
0.1
0.1
2015
£’m
(3.1)
2.3
(0.8)
2015
£’m
1.0
0.2
0.1
(2.1)
(0.8)
2014
£’m
0.1
–
0.1
2014
£’m
0.1
0.1
2014
£’m
(1.2)
2.2
1.0
2014
£’m
(0.7)
(0.2)
2.2
(0.3)
1.0
The following are the major deferred tax liabilities and assets recognised by the Company and the movements thereon during
the year:
Deferred tax liabilities
1 January 2014
Charge to income for the year
Acquisitions
31 December 2014
Credit to income for the year
Acquisitions
31 December 2015
Accelerated
capital
allowances
£’m
On intangible
assets
£’m
(0.7)
(0.2)
–
(0.9)
–
(0.2)
(1.1)
–
–
(0.3)
(0.3)
0.2
(1.9)
(2.0)
Total
£’m
(0.7)
(0.2)
(0.3)
(1.2)
0.2
(2.1)
(3.1)
85
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Notes to the Company financial statements continued
For the year ended 31 December 2015
47 DEFERRED TAX CONTINUED
Deferred tax assets
1 January 2014
Transactions with owners
31 December 2014
Transactions with owners
31 December 2015
Share-based
payments
£’m
1.0
1.2
2.2
0.1
2.3
A deferred tax asset has been recognised on the share-based payments charge. An amount of £0.1m (2014: £1.2m) has been taken
directly to equity.
48 SHARE CAPITAL
Authorised:
199,000,000 ordinary shares of 5p each
Allotted, issued and fully paid:
95,954,760 (2014: 82,213,540) ordinary shares of 5p each
The issued ordinary share capital is as follows:
Date
31 January 2014
3 July 2014 – exercise of share options
18 August 2014 – exercise of share options
7 October 2014 – equity raised to acquire Cintas UK
16 October 2014 – exercise of share options
31 December 2014
23 April 2015 – exercise of share options
10 June 2015 – exercise of share options
16 November 2015 – exercise of share options
8 December 2015 – equity raised to acquire Wincanton
31 December 2015
2015
£’m
10.0
4.8
2014
£’m
10.0
4.1
Number of
ordinary shares
74,900,491
Issue price
80,000
20,000
7,090,049
123,000
82,213,540
372,541
256,016
35,739
13,076,924
95,954,760
83.0p
83.0p
210.0p
32.5p
5.0p
5.0p
5.0p
260.0p
86
Restore plc Report & Accounts 2015
49 CASH INFLOW FROM OPERATIONS
(Loss)/profit before tax
Depreciation of property, plant and equipment
Amortisation and impairment of intangible assets
Net finance costs
Share-based payments charge
Increase in inventories
Decrease/(increase) in trade and other receivables
Increase/(decrease) in trade and other payables
Net cash generated from operations
50 SHARE-BASED PAYMENTS
Details of the share-based payments can be found in Note 29.
Year ended
31 December
2015
£’m
Year ended
31 December
2014
£’m
(3.0)
1.9
5.8
1.6
0.9
(0.1)
2.9
1.8
11.8
3.7
0.8
1.2
0.8
0.9
–
(5.1)
(1.7)
0.6
51 LEASING COMMITMENTS
The Company leases various premises and assets under non-cancellable operating lease agreements of varying terms. The majority
of the lease agreements are renewable at the end of the lease period at market rate.
Future aggregate minimum lease payments
under non-cancellable operating leases
– Within one year
– Within two to five years
– Over five years
Land and buildings
Plant and machinery
2015
£’m
7.9
25.5
28.1
61.5
2014
£’m
3.7
13.4
11.5
28.6
2015
£’m
0.4
0.4
–
0.8
The operating leases represent rentals payable by the Company for certain properties, vehicles and equipment.
52 C APITAL COMMITMENTS
Capital expenditure
Contracted for but not provided in the financial statements
2015
£’m
–
2014
£’m
0.3
0.4
–
0.7
2014
£’m
0.1
53 CONTINGENT LIABILITIES
The Company has entered into a bank cross guarantee with its subsidiaries. The guarantee amounts to £60.6m at 31 December 2015
(2014: £30.9m). The assets of the Company and its subsidiaries are pledged as security for the bank borrowings, by way of a fixed
and floating charge.
54 RELATED PARTY TRANSACTIONS AND CONTROLLING PARTY
Details of related party transactions can be found in note 34.
55 POST BALANCE SHEET EVENT
On 10 March 2016, the Company disposed of Restore Document Management Ireland Limited for €36.0m.
87
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Notes to the Company financial statements continued
For the year ended 31 December 2015
56 EXPLANATION OF TRANSITION TO IFRS
Reconciliation of shareholders’ equity at 1 January 2014
Note
a, b
b
d
d
Effect of
transition to
IFRS
£’m
Restated
under
IFRS
£’m
UK GAAP
£’m
17.2
12.3
26.3
–
55.8
0.1
18.1
1.0
19.2
75.0
(6.1)
(5.8)
(0.2)
(12.1)
(10.0)
(16.6)
(0.7)
(0.1)
(27.4)
35.5
3.7
21.3
1.0
9.5
35.5
0.9
(0.9)
–
1.0
1.0
–
–
–
–
1.0
–
–
–
–
–
–
–
–
–
1.0
–
–
1.0
–
1.0
18.1
11.4
26.3
1.0
56.8
0.1
18.1
1.0
19.2
76.0
(6.1)
(5.8)
(0.2)
(12.1)
(10.0)
(16.6)
(0.7)
(0.1)
(27.4)
36.5
3.7
21.3
2.0
9.5
36.5
FIXED ASSETS
Intangible assets
Property, plant and equipment
Investments
Deferred tax asset
CURRENT ASSETS
Inventories
Trade and other receivables
Cash and cash equivalents
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Financial liabilities – borrowings
Current tax liabilities
NON-CURRENT LIABILITIES
Financial liabilities – borrowings
Other long term liabilities
Deferred tax liability
Provisions
NET ASSETS
SHAREHOLDERS EQUITY
Called up share capital
Share premium account
Other reserves
Retained earnings
TOTAL SHAREHOLDERS EQUITY
88
Restore plc Report & Accounts 2015 Reconciliation of shareholders’ equity at 31 December 2014
FIXED ASSETS
Intangible assets
Property, plant and equipment
Investments
Deferred tax asset
CURRENT ASSETS
Inventories
Trade and other receivables
Cash and cash equivalents
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Financial liabilities – borrowings
Current tax liabilities
NON-CURRENT LIABILITIES
Financial liabilities – borrowings
Other long term liabilities
Deferred tax liability
Provisions
NET ASSETS
SHAREHOLDERS EQUITY
Called up share capital
Share premium account
Other reserves
Retained earnings
TOTAL SHAREHOLDERS EQUITY
Note
a, b, c, d
b
c
d
d
a, c
Effect of
transition to
IFRS
£’m
Restated
under
IFRS
£’m
UK GAAP
£’m
18.5
13.9
53.8
–
86.2
0.1
22.2
2.7
25.0
111.2
(6.0)
(2.5)
(0.5)
(9.0)
(34.1)
(17.4)
(0.9)
(0.1)
(52.5)
49.7
4.1
35.3
1.6
8.7
49.7
3.2
(0.8)
(0.2)
2.2
4.4
–
–
–
–
4.4
(0.1)
–
–
(0.1)
–
–
(0.3)
–
(0.3)
4.0
–
–
2.1
1.9
4.0
21.7
13.1
53.6
2.2
90.6
0.1
22.2
2.7
25.0
115.6
(6.1)
(2.5)
(0.5)
(9.1)
(34.1)
(17.4)
(1.2)
(0.1)
(52.8)
53.7
4.1
35.3
3.7
10.6
53.7
89
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Notes to the Company financial statements continued
For the year ended 31 December 2015
56 EXPLANATION OF TRANSITION TO IFR S CONTINUED
Reconciliation of profit at 31 December 2014
Turnover
Cost of sales
Gross profit
Distribution costs
Administrative expenses
Operating profit
Interest receivable and similar income
Interest payable and similar income
Profit on ordinary activities before taxation
Taxation
Profit on ordinary activities and profit for the financial year
Notes to the reconciliation of shareholders equity
a) Goodwill and intangible assets
Note
UK GAAP
£’m
Effect of
transition to
IFRS
£’m
Restated under
IFRS
£’m
a, c
23.0
(12.2)
10.8
–
(8.3)
2.5
0.2
(1.0)
1.7
(1.2)
0.5
–
–
–
–
1.9
1.9
–
–
1.9
–
1.9
23.0
(12.2)
10.8
–
(6.4)
4.4
0.2
(1.0)
3.6
(1.2)
2.4
The Company has elected not to apply IFRS 3 ‘Business Combinations’ retrospectively to business combinations that took place
before 1 January 2014. The Company has adopted IFRS 3 ‘Business continuations’ in full for all acquisitions that have occurred
after this date.
The Company has recognised customer relationships on acquisition at 31 December 2014 of £1.4m, the amortisation charge on
these was £0.1m. The Company has elected not to amortise goodwill in line with Company policy.
As a result of expenses which were previously capitalised in investments, £nil at 1 January 2014 and £0.2m at 31 December 2014
have been reclassified as an administrative expense through profit or loss.
b) Software classification
Application software, which can be run independently from any specific hardware configuration, is included within intangibles under
IFRS rather than tangible assets as is the norm under UK GAAP. The effect of this is to reclassify software of £0.9m at 1 January 2014
and £0.8m at 31 December 2014 from tangible assets to intangible assets. Total net assets remain unchanged by this adjustment.
c) Retained earnings
Retained earnings have been restated due to the removal of amortisation of goodwill of £2.2m and costs of acquisition of
£0.2m at 31 December 2014.
d) Deferred tax
A deferred tax asset on share options of £1.0m has been recognised at 1 January 2014 and £2.2m at 31 December 2014.
A deferred tax liability on the customer relationship intangible assets has been recognised of £0.3m at 31 December 2014. The
unwinding of the liability has been taken to profit or loss in the year.
90
Restore plc Report & Accounts 2015 Notice of Annual General Meeting
RESTORE PLC
Notice is hereby given that the Annual General Meeting of Restore plc ('the Company') will be held at the offices of Cenkos
Securities plc, 6.7.8 Tokenhouse Yard, London EC2R 7AS on 23 May 2016 at 2.00pm for the following purposes:
ORDINARY BUSINESS
1. To receive the Company’s annual accounts for the financial year ended 31 December 2015, together with the Directors’ report and
the auditors’ report on those accounts.
2. To re-appoint RSM UK Audit LLP (which has changed its name from Baker Tilly UK Audit LLP) as auditors to the Company to hold
office from the conclusion of the meeting until the conclusion of the next annual general meeting at which accounts are laid.
3. To authorise the Directors to set the auditors’ remuneration.
4. To re-appoint Adam Thomas Councell, who retires by rotation pursuant to the Company’s articles of association, as a Director of
the Company.
5. To declare a final dividend of 2.2 pence per ordinary share in respect of the year ended 31 December 2015. This dividend will be
paid on 8 July 2016 to the holders of ordinary shares at 6pm on 10 June 2016 (the ex dividend date being 9 June 2016).
SPECIAL BUSINESS
As special business, to consider and, if thought fit, to pass the following resolutions which will be proposed as to resolution 6 as an
ordinary resolution and as to resolutions 7 and 8 as special resolutions:
6. That the Directors be and they are hereby generally and unconditionally authorised in substitution for all existing authorities
(but without prejudice to any allotment of shares or grant of rights already made, offered or agreed to be made pursuant to such
authorities) to exercise all the powers of the Company to allot equity securities (as defined in section 560 of the Companies Act
2006 (the 'Act')) up to an aggregate nominal amount of £1,599,246 (being 31,984,920 ordinary shares of 5 pence each) provided
that this authority shall, unless renewed, expire at the conclusion of the next annual general meeting of the Company after the
passing of this resolution or if earlier on the date which is 15 months after the date of this annual general meeting, except that the
Company may before such expiry make offers or agreements which would or might require equity securities to be allotted after
such expiry and the directors may allot equity securities in pursuance of any such offers agreements as if the authority conferred by
this resolution had not expired.
7. That, subject to the passing of resolution number 6 above, the directors be and they are hereby empowered, pursuant to section
570 of the Act, to allot equity securities (as defined in section 560 of the Act) for cash pursuant to the authority conferred by
resolution number 6 or by way of a sale of treasury shares as if section 561 of the Act did not apply to any such allotment, provided
that this power shall be limited to:
7.1 the allotment of equity securities in connection with a rights issue or other pro rata offer in favour of holders of equity
securities where the equity securities respectively attributable to the interests of all those persons at such record dates as the
directors may determine are proportionate (as nearly as may be) to the respective numbers of equity securities held by them
subject to such exclusions or other arrangements as the directors may consider necessary or expedient to deal with treasury
shares, fractional entitlements, record dates, practical or legal difficulties under the laws of any territory or the requirements of
any regulatory body or stock exchange or by virtue of equity securities being represented by depositary receipts or any other
matter whatsoever; and
7.2 the allotment (otherwise than pursuant to paragraph 10.1 above) of equity securities up to an aggregate nominal amount of
£479,773.80,
and shall expire upon the expiry of the general authority conferred by resolution 6 above, except that the Company may before
such expiry make offers or agreements which would or might require equity securities to be allotted and/or shares held by the
Company in treasury to be sold or transferred after such expiry and the directors may allot equity securities and/or sell or transfer
shares held by the Company in treasury in pursuance of such offers or agreements as if the power conferred by this resolution had
not expired.
91
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015
Notice of Annual General Meeting continued
SPECIAL BUSINESS CONTINUED
8. That the Company be and is hereby generally and unconditionally authorised, in accordance with section 701 of the Act, to make
market purchases (within the meaning of section 693(4) of the Act) of ordinary shares of 5 pence each in the capital of the Company
('Ordinary Shares') on such terms and in such manner as the directors may from time to time determine provided that:
8.1 the maximum number of Ordinary Shares authorised to be purchased is 9,595,476;
8.2 the minimum price which may be paid for each Ordinary Share is 5 pence (exclusive of expenses payable by the Company); and
8.3 the maximum price which may be paid for each Ordinary Share (exclusive of expenses payable by the Company) cannot be
more than 105 per cent. of the average market value of an Ordinary Share for the five business days prior to the day on which
the Ordinary Share is contracted to be purchased.
The authority conferred shall expire at the conclusion of the next annual general meeting of the Company or if earlier on the date
which is 15 months after the date of this annual general meeting except that the Company may before such expiry make a contract
to purchase its own shares which will or may be completed or executed wholly or partly after such expiry.
By order of the Board
Sarah Waudby
Company Secretary
24 March 2016
Registered Office
The Databank
Unit 5
Redhill Distribution Centre
Salbrook Road
Redhill
Surrey RH1 5DY
92
Restore plc Report & Accounts 2015
NOTES: THESE NOTES ARE IMPORTANT AND REQUIRE YOUR IMMEDIATE ATTENTION.
1. A Shareholder entitled to attend and vote at the Annual General Meeting is entitled to appoint another person of his/her choice as
that Shareholder's proxy to exercise all or any of that Shareholder's rights to attend and to speak and vote at the meeting on his/
her behalf. A Shareholder may appoint more than one proxy in relation to the meeting, provided that each proxy is appointed to
exercise the rights attached to a different share or shares held by that Shareholder. A proxy does not need to be a shareholder of
the Company.
2. A Form of Proxy for use in connection with the meeting is enclosed with the document of which this notice forms part. Completion
and return of a Form of Proxy will not prevent a Shareholder from attending and voting in person at the meeting. Addresses
(including electronic addresses) in this document are included strictly for the purposes specified and not for any other purpose.
3. To appoint a proxy or proxies Shareholders must complete a Form of Proxy, sign it and return it, together with the power of
attorney or, any other authority under which it is signed, or a notarially certified copy of such authority, to the Company's
registrars, Capita Asset Services, PXS1, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4ZF so that it is received no later
than 2.00pm on 19 May 2016.
4. Only those members entered on the register of members of the Company at 6.00pm on 19 May 2016 or, in the event that this
meeting is adjourned, in the register of members as at 6.00pm on the day two days before the date of any adjourned meeting, shall
be entitled to attend and vote at the meeting in respect of the number of ordinary shares registered in their names at that time.
Changes to the entries on the register of members by the close of business on 19 May 2016 or, in the event that this meeting is
adjourned, in the register of members before the close of business on the day two days before the date of the adjourned meeting,
shall be disregarded in determining the rights of any person to attend or vote at the meeting.
5. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so for the
Annual General Meeting to be held at 2.00pm on 23 May 2016 and any adjournment(s) thereof by using the procedures described
in the CREST Manual. CREST personal members or other CREST sponsored members, and those CREST members who have
appointed a voting service provider should refer to their CREST sponsors or voting service provider(s), who will be able to take the
appropriate action on their behalf.
In order for a proxy appointment or instruction made by means of CREST to be valid, the appropriate CREST message (a 'CREST
Proxy Instruction') must be properly authenticated in accordance with Euroclear UK & Ireland Limited’s specifications and must
contain the information required for such instructions, as described in the CREST Manual. The message must be transmitted so as
to be received by the Company’s agent, Capita Registrars Limited (CREST Participant ID: RA10), no later than 48 hours before the
time appointed for the meeting. For this purpose, the time of receipt will be taken to be the time (as determined by the time stamp
applied to the message by the CREST Application Host) from which the Company’s agent is able to retrieve the message by enquiry
to CREST in the manner prescribed by CREST.
CREST members and, where applicable, their CREST sponsor or voting service provider should note that Euroclear UK & Ireland
Limited does not make available special procedures in CREST for any particular messages. Normal system timings and limitations
will therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned
to take (or, if the CREST member is a CREST personal member or sponsored member or has appointed a voting service provider,
to procure that his CREST sponsor or voting service provider takes) such action as shall be necessary to ensure that a message is
transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their
CREST sponsor or voting service provider are referred in particular to those sections of the CREST Manual concerning practical
limitations of the CREST system and timings.
The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated
Securities Regulations 2001.
6. You may appoint more than one proxy provided each proxy is appointed to exercise rights attached to different shares. In the event
of a conflict between a blank proxy form and a proxy form which states the number of shares to which it applies, the specific proxy
form shall be counted first, regardless of whether it was sent or received before or after the blank proxy form, and any remaining
shares in respect of which you are the registered holder will be apportioned to the blank proxy form. You may not appoint more
than one proxy to exercise rights attached to any one share. To appoint more than one proxy, you should contact Capita Asset
Services, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU.
7. Any corporation which is a member can appoint one or more corporate representatives who may exercise on its behalf all of its
powers as a member provided that they do not do so in relation to the same shares.
8. Copies of the following documents will be available for inspection at the Company’s registered office during normal working hours
on any week day (Saturdays, Sundays and public holidays excepted) from the date of this notice until the date of the Annual General
Meeting and at the place of the Annual General Meeting for 15 minutes prior to and during the meeting:
a. copies of all service agreements or letters of appointment under which the Directors of the Company are employed by the Company.
9. Biographical details of each Director who is being proposed for re-appointment or re-election by shareholders can be found by
visiting the Company’s website www.restoreplc.com.
93
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015
Notice of Annual General Meeting continued
EXPLANATION OF RESOLUTIONS
Resolution 6 – authority to allot shares
At the last AGM of the Company held on 15 May 2015, the Directors were given authority to allot ordinary shares in the capital of
the Company up to a maximum nominal amount of £1,370,225.65 representing approximately one third of the Company’s then
issued ordinary share capital.
The Directors consider it appropriate that a further similar authority be granted to allot ordinary shares in the capital of the
Company up to a maximum nominal amount of £1,599,246 representing approximately one third of the Company’s issued ordinary
share capital as at 24 March 2016 (the latest practicable date before publication of this document) during the shorter of the period
up to the conclusion of the next annual general meeting in 2017 or 15 months.
As at the date of this notice the Company does not hold any ordinary shares in the capital of the Company in treasury.
Resolution 7 – disapplication of statutory pre-emption rights
Resolution 7 will empower the directors to allot ordinary shares in the capital of the Company for cash on a non-pre-emptive basis:
•
in connection with a rights issue or other pro-rata offer to existing shareholders; and
• (otherwise than in connection with a rights issue or other pro-rata offer to existing shareholders) up to a maximum nominal value
of £479,773.80, representing approximately 10 per cent of the issued ordinary share capital of the Company as at 24 March 2016
(the latest practicable date before publication of this document).
Resolution 8 – authority to make market purchases of own shares
Resolution 8 gives the Company authority to buy back its own ordinary shares in the market as permitted by the Companies Act
2006. The authority limits the number of shares that could be purchased to a maximum of 9,595,476 (representing approximately
10 per cent. of the Company’s issued ordinary share capital as at 24 March 2016 (the latest practicable date before publication of
this document)), and sets minimum and maximum prices. This authority will expire at the conclusion of the next annual general
meeting or, if earlier, 15 months after the resolution is passed.
The Directors have no present intention of exercising the authority to purchase the Company’s ordinary shares but will keep
the matter under review, taking into account the financial resources of the Company, the Company’s share price and future
funding opportunities. The authority will be exercised only if the directors believe that to do so would be in the best interest of
shareholders generally.
Companies purchasing their own shares are allowed to hold them in treasury as an alterative to cancelling them. No dividends are
paid on shares whilst held in treasury and no voting rights attach to treasury shares.
94
Restore plc Report & Accounts 2015 RESTORE PLC
(the 'Company')
(registered in England – No. 5169780)
FORM OF PROXY FOR USE AT THE ANNUAL GENERAL MEETING
TO BE HELD ON 23 MAY 2016 AT 2.00pm.
I/We
(Name in full in block capitals please)
of
being [a] member[s] of Restore plc appoint the Chairman of the meeting or
as my/our proxy to vote for me/us on my/our behalf at the annual general meeting of the Company to be held on 23 May 2016 at
2.00pm and at any adjournment of the meeting, on the resolutions listed below, as indicated by an ‘X’ in the appropriate box and,
on any other resolutions, as he thinks fit.
Please tick here if this proxy appointment is one of multiple appointments being made
For
Against
Vote
Withheld
Resolution
Business
Ordinary Resolutions
1.
2.
3.
4.
5.
6.
To receive the Company’s annual accounts for the financial year ended
31 December 2015 together with the Directors’ report and the auditor’s report
on those accounts.
To re-appoint RSM UK Audit LLP as auditors.
To authorise the Directors to set the auditors’ remuneration.
To re-appoint Adam Councell as a Director of the Company.
To declare a dividend of 2.2 pence per Ordinary Share
To authorise the Directors to allot shares pursuant to section 551 Companies
Act 2006.
Special Resolutions
7.
8.
To disapply section 561 Companies Act 2006.
To authorise the Company to make market purchases of its own shares.
Signature:
Date:
2016
To return your completed Proxy form
please use the reply paid envelope provided
"
95
OverviewStrategic reportGovernanceFinancialsOther informationRestore plc Report & Accounts 2015 Notice of Annual General Meeting continued
NOTES
1. A member who is entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend, speak and to vote
instead of him/her provided each proxy is appointed to exercise rights in respect of different shares. To appoint more than one
proxy (an) additional proxy form(s) may be obtained by contacting Capita Asset Services, PXS1, The Registry, 34 Beckenham Road,
Beckenham, Kent, BR3 4ZF, or you may photocopy this page indicating on each copy the name of the proxy you wish to appoint and
the number of shares in respect of which the proxy is appointed. All forms must be signed and should be returned to Capita Asset
Services in the same envelope.
2. A proxy need not be a member of the Company but must attend the meeting to represent you. To appoint as your proxy a person
other than the Chairman of the meeting, insert their full name in the space provided. If you sign and return this proxy form with no
name inserted as such, the Chairman of the meeting will be deemed to be your proxy. Where you appoint as your proxy someone
other than the Chairman, you are responsible for ensuring that they attend the meeting and are aware of your voting intentions.
3.
4.
If someone else signed the form on your behalf, you or that person must send the power of attorney or other written authority
under which it is signed to the address detailed in Note 6 below.
In the case of joint holders, the vote of the senior member who tenders a vote, whether in person or by proxy, will be accepted to
the exclusion of the votes of any other of the joint holders. For these purposes, seniority shall be determined by the order in which
the names stand on the register of members.
5.
In the case of a corporation, this Form of Proxy must be executed under its common seal or signed on its behalf by a duly
authorised officer.
6. To be valid any proxy form or other instrument appointing a proxy must be:
a. completed and signed;
b. sent or delivered to Capita Asset Services, PXS1, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4ZF; and
c. received by Capita Asset Services no later than 2.00pm on 19 May 2016.
7. Completion of a Form of Proxy will not affect the right of a member to attend and vote at the Annual General Meeting.
8. To direct your proxy how to vote on the resolutions mark the appropriate box on your proxy form with an ‘X’. To abstain from
voting on a resolution, select the relevant 'Vote withheld' box. A vote withheld is not a vote in law, which means that the vote
will not be counted in the calculation of votes for or against the resolution. If no voting indication is given, your proxy will vote or
abstain from voting at his or her discretion. Your proxy will vote (or abstain from voting) as he or she thinks fit in relation to any
other matter which is put before the meeting.
9. Shares held in uncertificated form (i.e. in CREST) may be voted through the CREST Proxy Voting Service in accordance with the
procedures set out in the CREST Manual. The message must be transmitted so as to be received by the Company’s agent, Capita
Asset Services Limited (CREST Participant ID: RA10), no later than 48 hours before the time appointed for the meeting. For this
purpose, the time of receipt will be taken to be the time (as determined by the time stamp applied to the message by the CREST
Application Host) from which the Company’s agent is able to retrieve the message by enquiry to CREST in the manner prescribed
by CREST.
10. You may not use any electronic address provided either in this form of proxy or any related documents (including the notice of
meeting) to communicate with the Company for any purposes other than those expressly stated.
96
"
Restore plc Report & Accounts 2015
Overview
Strategic report
Governance
Financials
Other information
Officers and advisers
COMPANY SECRETARY
Sarah Waudby
REGISTERED NUMBER AND OFFICE
05169780
The Databank,
Unit 5 Redhill Distribution Centre
Salbrook Road
Redhill
Surrey
RH1 5DY
NOMINATED ADVISER & BROKER
Cenkos Securities plc
6.7.8 Tokenhouse Yard
London
EC2R 7AS
PUBLIC RELATIONS
FTI Consulting
200 Aldersgate
Aldersgate Street
London
EC1A 4HD
INVESTOR RELATIONS CONSULTANTS
Capital Access Group
Sky Light City Tower
50 Basinghall Street
London
EC2V 5DE
Trading Record
INDEPENDENT AUDITOR
RSM UK Audit LLP
Chartered Accountants
25 Farringdon Street
London
EC4A 4AB
SOLICITORS
Brabners LLP
55 King Street
Manchester
M2 4LQ
BANKERS
Barclays Bank PLC
1 Churchill Place
London
E14 5HP
The Royal Bank of Scotland plc
Floor 9
280 Bishopsgate
London
EC2M 4RB
REGISTRARS
Capita Asset Services
The Registry
34 Beckenham Road
Beckenham Kent
BR3 4TU
Year ended 31 December
Revenue
Adjusted profit before taxation*
Adjusted earnings per share*
Net debt
Net assets
2015
£’m
91.9
16.3
15.6p
(60.6)
104.7
2014
£’m
67.5
12.0
12.3p
(30.9)
67.0
2013
£’m
53.6
10.0
10.5p
(16.0)
47.1
2012
£’m
43.3
6.2
7.4p
(17.8)
36.3
2011
£’m
18.8
3.7
4.3p
(11.6)
23.3
* Before exceptional items (including exceptional finance costs), amortisation of intangible assets, share based payments and other finance costs.
Financial calendar
Annual General Meeting
Half year results
Financial year end
Full year results
Held in May
September
31 December
March
97
Restore plc Report & Accounts 2015 Report & Financial Statements
For the year ended 31 December 2015
R
e
p
o
r
t
&
F
i
n
a
n
c
i
a
l
S
t
a
t
e
m
e
n
t
s
Head Office
66 Grosvenor Street
London W1K 3JL
T: 020 7409 2420
E: info@restoreplc.com
W: www.restoreplc.com
f
o
r
t
h
e
y
e
a
r
e
n
d
e
d
3
1
D
e
c
e
m
b
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r
2
0
1
5
LOCATIONS
Restore Document Management
T: 01293 446 270
E: admin@restore.co.uk
W: www.restore.co.uk
The Databank
Unit 5 Redhill Distribution Centre
Salbrook Road
Redhill Surrey
RH1 5DY
Harrow Green
T: 0345 603 8774
E: info@harrowgreen.com
W: www.harrowgreen.com
2 Oriental Road
Silvertown
London
E16 2BZ
Restore Shred
T: 01869 238 521
E: admin@restoreshred.com
W: www.restore.co.uk/shred
Restore Scan
T: 01293 446 270
E: enquiries@restorescan.co.uk
W: www.restore.co.uk/scan
234 Heyford Park
Upper Heyford
Oxfordshire
OX25 5HA
Relocom
T: 0345 313 1491
E: contactus@relocom.co.uk
W: www.relocom.co.uk
Restore IT Efficient
T: 01462 813 132
E: ite@itefficient.com
W: www.restore.co.uk/it-disposal
Unit 4B-4F Shefford Industrial Park
St Francis Way
Shefford Bedfordshire
SG17 5DZ
Unit 3 The Links
Popham Close
Feltham
TW13 6JE
ITP Group
T: 0118 943 8001
E: info@itp-group.com
W: www.itp-group.com
Unit 1 Stadium Way
Tilehurst
Reading Berkshire
RG30 6BX