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Solid State PLC
CONTENTS
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1
Solid State PLC
Directors:
DIRECTORS, SECRETARY AND ADVISERS
Deputy Chairman
Chief Executive Officer
Gordon Leonard Comben, Chairman
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John Michael Lavery, Director
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William George Marsh, Director
Director
Finance Director
Company Secretary and
Registered Office:
Peter Haining, FCA
Solid State PLC
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Company Number:
00771335
Nominated Adviser:
Broker:
Auditors:
Solicitors:
Bankers:
Registrars:
W H Ireland Limited
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haysmacintyre
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Thomson Snell & Passmore
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Capita Registrars Limited
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Country of Incorporation
of Parent Company:
Great Britain
Legal Form:
Public Limited Company
Domicile:
Great Britain
2
Solid State PLC
CHAIRMAN’S STATEMENT
Results
I am very pleased to report that the Group has continued to build on the strong performance achieved last year
delivering a second consecutive year of record results.
Revenues increased by 22% to £25.87m (2011: £21.17m) with profit before tax rising by 29% to £1.60m (2011:
£1.24m). Underlying growth in the core business, excluding costs of £223k associated with the recent acquisition of
the trade and assets of Blazepoint Ltd saw revenue increase by 20% and profits increase by 34%.
The Group typically experiences margin variation due to order size and product mix however retains its ability to
command good margins due to the value added nature of its offering. Pleasingly, despite lower margins in the first
half of the year due to the product mix and continuing margin pressures resulting from broader economic conditions
and competition, Group gross profit margins were maintained at 27.8% for the year as a whole.
The operating margins increased to 6.4% when including the gain on the acquisition of the trade and assets of
Blazepoint Ltd (2011: 6.1%). Profit before tax has increased by 29% to £1.6m (2011: £1.24m) and earnings per
share have increased by 24% to 19.5p (2011: 15.7p).
The balance sheet continues to strengthen. Total net assets have increased 30% to £5.1m (2011: £3.94m). Working
capital requirements have increased in line with sales and at the year end the Company had a net gearing level of
47% (2011: 40%).
Highlights include:
Financial:
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
Turnover
Profit before tax
Earnings per share (basic)
Gross profit margin
Operating margin
Dividend
2102
£25.874m
£1.599m
19.5p
27.8%
6.4%
7.25p
1102
£21.169m
£1.243m
15.7p
27.8%
6.1%
6.0p
egnahC
+22%
+29%
+24%
0%
+30bps
+21%
Operational:
(cid:129) Acquisition of trade and assets of Blazepoint Ltd in October 2011 for £200k
(cid:129) Strong performance from all operating divisions
(cid:129) Planned relocation of Solid State Supplies Ltd to achieve improved operational efficiencies
Commenting on the results, Gordon Comben, Chairman of Solid State said:
“These results demonstrate the value of building embedded partnerships with our clients in targeted niche sectors.
This is the second successive year of record results.
“We continue to see opportunities for both organic and acquisitive growth in a market which demands increasing
levels of product customisation. This plays very much to our strengths, the prospects for Solid State are extremely
positive.”
Dividends
The Directors recommend that a final dividend of 4.75p per share be paid. An interim dividend of 2.5p per share
was paid in January 2012 giving a total dividend in respect of the year of 7.25p per share (2011: 6p per share). The
final dividend will be paid on 31st August 2012 to shareholders on the register at the close of business on 10th
August 2012. The shares will go ex-dividend on 8th August 2012.
Business Review
The Group is focussed on the supply and support of specialist electronics equipment which include high tolerance
and tailor made battery packs, specialist electronic components and industrial/rugged computers.
The market for the Group’s products and services is driven by the need for custom electronic solutions to address
complex needs, typically in harsh environments where enhanced durability and resistance to extreme and volatile
temperatures is vital. Drivers in our markets include efficiency improvement, cost saving, environmental
monitoring and safety.
3
Solid State PLC
CHAIRMAN’S STATEMENT (continued)
Divisional Review
The key performance indicators measured by management are billings, bookings and gross profit margins. Bookings
are sales orders received and billings are sales delivered.
Solid State Supplies Ltd
Solid State Supplies is a distributor of specialist components to the UK OEM community; selling semiconductors,
related components and modules for embedded processing, control and communications switches, power
management units and LED lighting.
The financial year to 31st March 2012 saw a continuation of the growth achieved in the previous year with bookings
growing 15% and billings 39% year on year.
Whilst gross margins on sales remain under pressure the total gross margin including commissions held up well at
27.6% (2011: 27.3%, 2010: 27.2%).
New product franchises acquired during the current and previous financial years have started to reflect in the growth
numbers and are now contributing well to the overall billings of the company. This trend is expected to continue into
FY2012/13 with new franchises accounting for a larger percentage of the overall sales. The company’s dependence
on sales to the military sector reduced during the year thus reducing the exposure to the Government’s austerity
measures. Pleasingly the company’s design-in pipeline (designs in progress at customers) has strengthened
throughout the year.
FY2012/13 will see the company relocating to larger and more suitable premises adjacent to its sister company,
Steatite, in Redditch. The company will enter the value added market space within the electronics distribution sector,
consequently strengthening the company’s position both with key customers and key suppliers. The outlook for
specialist electronic distribution and technical support remains buoyant and the company expects to see sustained
but single digit growth throughout the 2012/13 year.
Steatite Ltd (including Blazepoint Ltd)
Steatite designs, manufactures and supplies a range of products and solutions that include bespoke Lithium battery
packs, rugged mobile computing/radio solutions and industrial computer hardware and software. Key to its strategy
is the ability to design, manufacture and test to customer requirements for usage in some of the most difficult and
harsh environments against the most stringent of standards and qualifications.
Steatite went into the second period of last year with a large order book resulting in a very strong result for the year.
Sales increased during the year by 14% whilst profit increased by 22.5%. In October 2011 the company acquired the
trade and assets of Blazepoint Ltd and traded the business as Steatite Blazepoint Ltd for the balance of the fiscal
year. Excluding the results of Steatite Blazepoint Ltd in the period would have resulted in an increase in sales of
11.7% and profits of 24.9% in the underlying business on a like for like basis.
For the year ahead Steatite Blazepoint Ltd will trade as a division of Steatite Ltd with most of the restructuring
having taken place. This will enable it to contribute within Steatite to a greater level enhancing its product range and
prospects for the year ahead. One-off costs for the year totalled £110k of which all relates to the cost of acquisition
and restructuring of Blazepoint Ltd.
The prospects for Steatite Ltd for the year ahead remain positive. It continues to add to a strong order book and is
competing and winning some major contracts in all its chosen fields of expertise. The economy continues to present
challenges with order visibility difficult to predict. Nevertheless, we are confident that remaining focussed on our
strategy of supplying leading edge solutions will continue to build long term growth and value.
Divisional Summary
The companies in the Solid State group have distinct characteristics in their market places. A depth of technical
understanding and a collaborative approach to client relationships have always promoted an integrated process of
product design and supply. The degree of co-operation has always been appreciated by our clients and we believe it
is of significant commercial value both to us and our customers. Solid State will continue to pursue this approach
and to extend it into new relationships where appropriate.
Our stated strategy is to supplement organic growth with selective acquisitions within the electronics industry which
will complement our existing Group companies and enable us to achieve improved operating margins through the
employment of operational efficiencies, scale and distribution.
4
Solid State PLC
CHAIRMAN’S STATEMENT (continued)
Renewal of authority to purchase the Company’s shares and new authorities to issue shares
Last year, a resolution was passed at the Annual General Meeting to give the Company the authority to purchase its
own Ordinary shares on the Stock Exchange. This authority would expire after a period of eighteen months from
the passing of the resolution. In order to avoid this authority expiring during the next year and the need to call an
extraordinary general meeting to renew the authority, a resolution to renew the authority is set out in the notice of
the Annual General Meeting at the end of this document.
Under the terms of the resolution to be proposed at the Annual General Meeting, the maximum number of shares
which may be purchased is 1,018,715 shares representing 15% of the issued Ordinary share capital of the Company.
The minimum price payable by the Company for its Ordinary shares will be 5p and the maximum price will be
determined by reference to current market prices. The authority will automatically expire after a period of eighteen
months from the passing of the resolution unless renewed.
It is not the Directors’ current intention to exercise the power to purchase the Company’s Ordinary shares but they
believe that under certain circumstances it would be in the Company’s best interests to do so.
Resolutions are also being proposed at the Annual General Meeting with regard to the issue of further shares. One
resolution will authorise the company to issue new shares up to a third of the current issued share capital by way of a
rights issue and the second resolution will authorise the company to issue new shares up to 20% of the current issued
share capital without rights of pre-emption for existing shareholders, and to the extent that new shares are issued
under the second resolution the limit on the first resolution will be reduced such that the total number of new shares
issued cannot exceed one third of the current share capital.
Your Directors consider that the resolutions to be proposed at the meeting are in the best interests of the Company
and its shareholders. They unanimously recommend that all Ordinary shareholders vote in favour of the resolution
at the Annual General Meeting as they intend to do in respect of their beneficial holdings amounting to 4,317,037
Ordinary shares, representing 63.6% of the Company’s issued Ordinary share capital.
Outlook
The Group will continue its stated strategy of both organic and acquisitive growth. The successful acquisition and
integration of both Rugged Systems in 2010 and Blazepoint in October 2011 demonstrates that we can enhance
shareholder value through our policy of selective acquisitions in our chosen fields of computing, components and
batteries. We will continue to seek further acquisitions that complement our growth strategy and benefit
shareholders.
We are mindful of the current economic environment but remain confident of the Group’s prospects for the year
ahead and beyond. We entered the new financial year with a strong order book which at 31st March 2012 stood at
£10.5m (31st March 2011: £8.4m). This has been underpinned with the recent announcement of a £3.5m order to be
delivered during H1 2012. This confidence is reflected in the Board’s decision to declare a final dividend of 4.75p
giving a total dividend for the year 7.25p, a 21% increase on the 2011 dividend of 6.0p. The prospects for Solid
State are extremely positive.
Finally, I would like to thank my fellow Directors and all the staff for their continued support in what has been an
outstanding year for the Group.
Gordon Comben
Chairman
20th June 2012
5
Solid State PLC
DIRECTORS’ REPORT
For the year ended 31st March 2012
The Directors submit their report together with the audited financial statements of the Group in respect of the year
ended 31st March 2012.
Principal Activities, Review of the Business and Future Developments
The principal activities of the Group during the year continued to be those of the manufacturing of electronic
equipment and the distribution of electronic components and materials.
The key performance indicators recognised by management are sales, bookings and group profit margins. Bookings
are sales orders received.
An overall review of the Group’s trading performance and future developments is given in the Chairman’s
Statement.
The principal risks faced by the Group are foreign currency risk, liquidity risk and credit risk.
Foreign currency risk primarily relates to the US dollar: Sterling exchange rate and although much progress has been
made in recent years in converting the sales currency into line with the purchase currency on any contract, the Group
still has purchases in dollars which are considerably in excess of the sales made in dollars. In the year under review the
Group purchased US$7,650,000.
The risk is managed by way of using forward purchase contracts to cover much of the required dollar purchases and
spot purchases to buy the balance of the dollars enabling the Group to take advantage of short term exchange rate
fluctuations. In addition, the extent of dollar holdings by the Group is minimised to avoid unnecessary exposure to
losses in the event of the decline of the dollar against sterling.
The nature of the business means that cash flow requirements fluctuate very significantly with some large contracts
requiring significant funding in the short term. Invoice discounting is used as a source of funding on trade debtors in
Steatite Limited, but in addition the Group has an overdraft facility of £1.5m, temporarily extended to £2.0m, to ensure
that facilities are always available to progress contracts, including circumstances where the contract has been awarded
close to the date of commencement and advance payments to suppliers are required. Such a contract was completed just
prior to the year end giving rise to a significant increase in trade receivables and bank overdraft.
Credit risk arises as the vast majority of sales are on credit terms, and the recent increase in turnover has led to trade
receivables rising from £3,876,414 at the start of the year under review to £6,519,349 at the end of the year. However it
is Group policy that all new customers are assessed for their credit risk before any binding contracts are entered into
and all existing accounts are reviewed at least once a year. In the year under review bad debts written off have
amounted to less than 0.03% of the turnover.
One major decision taken during the year was to purchase the business and relevant assets of Blazepoint Limited. The
Group has incurred non recurring expenditure of £110,000, principally staff termination costs, as a result of this
acquisition and the net loss arising in the period was £62,000. However, several former customers of Blazepoint are
now customers of Solid State PLC and the new acquisition is expected to make a significant positive contribution to
profits in the new financial year.
The Group finances its operations by a mixture of retained profits, bank borrowings and invoice discounting facilities.
The directors are pleased to note that the net tangible assets of the Group have increased during the year under review
by about £1,000,000.
The Group does not comment on environmental matters.
The Group continues to look for suitable acquisitions within the electronics industry.
6
Solid State PLC
DIRECTORS’ REPORT
For the year ended 31st March 2012 (continued)
Results and Dividends
The consolidated statement of comprehensive income is set out on page 13. The Directors recommend that a final
dividend of 4.75p per share is paid. The total dividend for the year is thus 7.25p per share. The final dividend will be
paid on 31st August 2012 to shareholders on the register at the close of business on 10th August 2012.
Directors
The Directors of the Company during the year were:
G L Comben
A B Frere
G S Marsh
P Haining, FCA
J M Lavery
J L Macmichael
W G Marsh
Gordon Comben, (dob 09/09/1939), Chairman
Gordon Comben trained as radio officer and after leaving the merchant navy worked in the electronics industry with
Plessey, Texas Instruments, Philips and International Rectifier. In 1971 he founded Solid State Supplies and has
been employed in various roles including Company Chairman. He is currently a Non-executive Director of the
Company, and was reappointed as Chairman in November 2011.
Tony Frere (dob 15/10/1947), Deputy Chairman
Tony Frere has been in the Electronics Industry for 40 years, 30 of which serving the component distribution sector.
Former directorships include Managing Director of DT Electronics and Nu Horizons Electronics. Currently sitting
on the executive council of the ECSN (the electronic component supply network trade association), and in 2012 was
appointed as Deputy Chairman.
Gary Marsh, (dob 27/04/1966), Chief Executive Officer
Gary Marsh joined the Company in 1986 having gained an HND in Business and Finance Studies. He has held
various positions within the Group including that of Operations Director of Solid State Supplies prior to his
appointment as its Managing Director in 1997. In addition to this role, Gary Marsh was appointed Group Managing
Director in 2002 following the acquisition of Steatite. In 2011 following the acquisition of Rugged Systems Ltd he
was appointed Chief Executive Officer of the Group.
Peter Haining FCA, (dob 05/09/1956), Finance Director and Company Secretary
Peter Haining qualified as a chartered accountant in 1980 and later worked at Binder Hamlyn. He left Binder
Hamlyn in 1992, together with three colleagues, to establish The Kings Mill Partnership. As well as fulfilling a role
as Finance Director and Company Secretary, Peter Haining has specific responsibility for reviewing and advising on
the Group’s budgets and financial affairs.
John Lavery, (dob 06/05/1961), Director
John Lavery is an apprenticed trained engineer in Electronics Communications. He moved into Sales in the 1980’s
with Steatite before being appointed to The Board of Directors at the age of 28.He has held positions of Director of
Sales and Marketing after a years training with the Institute of Directors for Corporate Governance, before being
appointed Managing Director of Steatite in 1999. He presently runs the operations of Steatite on behalf of Solid
State plc.
John Macmichael, (dob 20/04/1961), Director
John Macmichael is an electronics and communications graduate whose career has encompassed design and
development through applications engineering, sales, sales management and general business management. John has
gained extensive management experience of multiple sales channels with distributors and OEMs both here in the
UK and worldwide through his international sales management role whilst living in the USA. Formerly managing
director of Breckenridge Technologies Limited John joined Solid State Supplies Limited in 2006 before being
appointed managing director in April 2011.
7
Solid State PLC
DIRECTORS’ REPORT
For the year ended 31st March 2012 (continued)
William Marsh, (dob 23/07/1937), Director
Educated at Kingston-upon-Thames Technical College, Bill Marsh started work at Hackbridge Transformers in
1954 as a Student Apprentice. In 1960, having gained an HNC qualification in electrical/electronic engineering he
joined the Royal Air Force as an Air Radar Fitter. In 1962 he joined Hewittic Rectifiers where he worked as a
Design Engineer and later as a Contracts Engineer. In 1968 Bill joined International Rectifier as an Area Sales
Manager, rising to the position of General Sales Manager (Northern Europe). In 1974 he joined Solid State Supplies
as Managing Director until he stepped down in 1997. Following a spell as Company Chairman he has continued to
serve on the Board of Directors as a Non-executive Director.
Details of the interests of Directors in the shares of the Company and Directors’ service contracts are stated in Note
5 to the financial statements.
Corporate Governance
The Board confirms that the Group has had regard, throughout the accounting period, with the provisions set out in
Section 1 of the Combined Code which was issued by the Financial Reporting Council in June 2008. Whilst not
required to do so, as a matter of best practice, the Directors have voluntarily endeavoured to comply with those
provisions which they consider to be relevant to a company of this size.
The audit committee consists of Messrs W G Marsh and A B Frere, and meets regularly to ensure that the financial
performance of the Group is properly recorded and monitored, to meet the auditors and to review the reports from
the auditors relating to accounts and internal control systems.
The remuneration committee consists of Messrs G L Comben, A B Frere and P Haining. The purpose of the
committee is to review the performance of the full time executive Directors and to set the scale and structure of their
remuneration and the basis of their service agreements with due regard to the interests of the shareholders. It is a rule
of the committee that no Director shall participate in discussions or decisions concerning his own remuneration.
Board of Directors
The Board consists of four executive Directors and three Non-executive Directors and meets regularly throughout
the year.
The Board comprises the executive management of the Group and thus maintains full control over its activities.
Decisions are accordingly taken quickly and effectively following consultation among the Directors concerned if
any matters arise. The Board takes the view that this direct but flexible approach has enabled the Company to deal
effectively with all matters.
Going Concern
The Directors confirm that they are satisfied that the Group has adequate resources to continue in business for the
foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the accounts.
Purchase of Own Shares
At the year end the Company had in place authority to purchase 1,018,715 ordinary shares under authority given by
a resolution at the Annual General Meeting on 8th September 2011. This authority expires on 8th March 2013.
Financial Instruments
Details of the use of financial instruments by the Company and its subsidiaries are contained in Note 19 of the
financial statements.
Internal Control
In respect of internal controls, the Directors are aware of the Turnbull Report and are continually reviewing the
effectiveness of the systems of internal controls, the key elements of which having regard to the size of the Group
are that the Board meets regularly and takes the decisions on all material matters, the organisational structure
ensures that responsibilities are defined and authority only delegated where appropriate, and that the regular
management accounts are presented to the Board wherein the financial performance of the Group is analysed.
The Directors acknowledge that they are responsible for the system of internal control which is established in order
to safeguard the assets, maintain proper accounting records and ensure that financial information used within the
business or published is reliable. Any such system of control can, however, only provide reasonable, not absolute,
assurance against material misstatement or loss.
8
Solid State PLC
DIRECTORS’ REPORT
For the year ended 31st March 2012 (continued)
Statement of Directors’ Responsibilities
The Directors are responsible for keeping proper accounting records that are sufficient to show and explain the
company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and
enable them to ensure that the financial statements comply with the Companies Act 2006 and Article 4 of the IAS
Regulation. They are also responsible for safeguarding the assets of the group and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities.
The Directors are also required to prepare financial statements for the Group in accordance with International
Financial Reporting Standards as adopted by the European Union (IFRSs) and the rules of the London Stock
Exchange for companies trading securities on the Alternative Investment Market. The Directors have chosen to
prepare financial statements for the Company in accordance with UK Generally Accepted Accounting Practice.
Group Financial Statements
International Accounting Standard 1 requires that financial statements present fairly for each financial year the
Group’s financial position, financial performance and cash flows. This requires the faithful representation of the
effects of transactions, other events and conditions in accordance with the definitions and recognition criteria for
assets, liabilities, income and expenses set out in the International Accounting Standards Board’s “Framework for
the preparation and presentation of financial statements.” In virtually all circumstances, a fair presentation will be
achieved by compliance with all applicable IFRSs.
A fair presentation also requires the Directors to:
(cid:129)
(cid:129)
(cid:129)
select suitable accounting policies in accordance with IAS 8 Accounting Policies, changes in Accounting
Estimates and Errors and then apply them consistently.
present information, including accounting policies, in a manner that provides relevant, reliable, comparable
and understandable information; and
provide additional disclosures when compliance with the specific requirements in IFRSs is insufficient to
enable users to understand the impact of particular transactions, other events and conditions on the entity’s
financial position and financial performance.
(cid:129) State that the group has complied with IFRS, subject to any material departures disclosed and explained in
the financial statements,
(cid:129)
and make judgements and estimates that are reasonable and prudent.
Parent company financial statements
Company law requires directors to prepare financial statements for each financial year which give a true and fair
view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these
financial statements, the Directors are required to:
(cid:129)
(cid:129)
select suitable accounting policies and then apply them consistently.
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
company will continue in business.
(cid:129) make judgements and estimates that are reasonable and prudent.
(cid:129)
state whether UK accounting standards have been followed, subject to any material departures disclosed
and explained in the financial statements.
Financial statements are published on the Group’s website in accordance with legislation in the United Kingdom
governing the preparation and dissemination of financial statements, which may vary from legislation in other
jurisdictions. The maintenance and integrity of the corporate and financial information group’s website is the
responsibility of the Directors. The Directors’ responsibility also extends to the ongoing integrity of the financial
statements contained therein. The work carried out by the auditors does not include consideration of the maintenance
and the integrity of the website and accordingly the auditor accepts no responsibility for any changes that have
occurred to the financial statements when they are presented on the website.
9
Solid State PLC
DIRECTORS’ REPORT
For the year ended 31st March 2012 (continued)
Creditor Payment Policy
The Company’s policy for the year to 31st March 2012 for all suppliers is to fix terms of payment when agreeing the
terms of each business transaction, to ensure the supplier is aware of those terms and to abide by the agreed terms of
payment.
Creditor days based on the year end trade creditors and purchases made in the year were 47 days (2011: 50 days).
Auditors
All of the current directors have taken all the steps that they ought to have taken to make themselves aware of any
information needed by the Company’s auditors for the purposes of their audit and to establish that the auditors are
aware of that information. The directors are not aware of any relevant audit information of which the auditors are
unaware.
A resolution to reappoint haysmacintyre as auditors will be proposed at the next annual general meeting.
By order of the Board
P Haining FCA
Secretary
20th June 2012
Registered Office: Unit 2, Eastlands Lane, Paddock Wood, Kent, TN12 6BU
10
REPORT OF THE INDEPENDENT AUDITORS
TO THE SHAREHOLDERS OF SOLID STATE PLC
Solid State PLC
We have audited the financial statements of Solid State PLC for the year ended 31st March 2012 which comprise the
Consolidated Statement of Comprehensive Income, the Consolidated Statement of Changes in Equity, the
Consolidated Statement of Financial Position, the Consolidated Statement of Cash Flows, the Company Balance
Sheet and the related notes. The financial reporting framework that has been applied in the preparation of the group
financial statements is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the
European Union. The financial reporting framework that has been applied in the preparation of the parent company
financial statements is applicable law and United Kingdom Accounting Standards (United Kingdom GAAP).
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those
matters we are required to state to them in an Auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s
members as a body, for our audit work, for this report, or for the opinions we have formed.
Respective responsibilities of directors and auditors
As explained more fully in the Directors’ Responsibilities Statement set out on pages 9 and 10, 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 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 Ethical
Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give
reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or
error. This includes an assessment of: whether the accounting policies are appropriate to the group’s and the parent
company’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of
significant accounting estimates made by the directors; and the overall presentation of the financial statements. In
addition, we read all the financial and non-financial information in the Directors’ Report to identify material
inconsistencies with the audited financial statements. If we become aware of any apparent material misstatements or
inconsistencies we consider the implications for our report.
Opinion on financial statements
In our opinion:
(cid:129)
the financial statements give a true and fair view of the state of the group’s and of the parent company’s
affairs as at 31 March 2012 and 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 United
Kingdom Generally Accepted Accounting Practice; and
the financial statements have been prepared in accordance with the requirements of the Companies Act
2006 and, as regards the group financial statements, Article 4 of the IAS Regulation.
(cid:129)
(cid:129)
(cid:129)
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Directors’ Report for the financial year for which the financial
statements are prepared is consistent with the 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:
(cid:129)
adequate accounting records have not been kept by the parent company, or returns adequate for our audit
have not been received from branches visited by us; or
(cid:129)
the parent company financial statements are not in agreement with the accounting records and returns; or
(cid:129)
certain disclosures of directors’ remuneration specified by law are not made; or
(cid:129) we have not received all the information and explanations we require for our audit.
11
Solid State PLC
Notes
REPORT OF THE INDEPENDENT AUDITORS
TO THE SHAREHOLDERS OF SOLID STATE PLC (continued)
1. The maintenance and integrity of the group’s website is the responsibility of the directors, the work carried
out by the auditors does not involve consideration of those matters and, accordingly, the auditors accept no
responsibility for any changes that may have occurred to the financial statements since they were initially
presented on the website.
2. Legislation in the United Kingdom governing the preparation and dissemination of financial statements
may differ from legislation in other jurisdictions.
David Cox (Senior statutory auditor)
for and on behalf of haysmacintyre, Statutory Auditor
20th June 2012
Fairfax House
15 Fulwood Place
London WC1V 6AY
12
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31st March 2012
Solid State PLC
euneveR
selas fo tsoC
TIFORP SSORG
stsoc noitubirtsiD
sesnepxe evitartsinimdA
noitisiuqca no niaG
SNOITAREPO MORF TIFORP
stsoc ecnaniF
NOITAXAT EROFEB TIFORP
esnepxe xaT
YTIUQE OT ELBATUBIRTTA TIFORP
TNERAP EHT FO SREDLOH
EMOCNI EVISNEHERPMOC REHTO
Translation differences on overseas operations
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
setoN
2
3
6
7
2012
£
151,478,52
)749,676,81(
_________
402,791,7
)908,813,2(
)039,173,3(
782,061
_________
2011
£
803,961,12
)846,282,51(
_________
066,688,5
)955,448,1(
)555,547,2(
-
_________
257,666,1
645,692,1
)806,76(
_________
)051,35(
_________
441,995,1
)951,282(
_________
693,342,1
)219,472(
_________
589,613,1
_________
484,869
_________
-
_________
807,4
_________
1,316,985
_________
973,192
_________
ERAHS REP SGNINRAE
cisaB
detuliD
8
8
p5.91
p2.91
p7.51
p0.51
The notes on pages 18 to 49 form part of these financial statements.
13
Solid State PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31st March 2012
erahS
latipaC
latipaC
erahS
deniateR egnahcxE noitpmedeR muimerP
evreseR
evreseR
ngieroF
Reserve Earnings Total
Balance at 31st March 2010
307,826
756,980
4,674
55,126
2,070,876
3,195,482
Total comprehensive income
For the year ended 31st March 2011
Share based payment expense
sdnediviD
-
-
-
-
-
-
4,708
968,484
973,192
-
16,188
16,188
-
_______
-
_______
-
_______
-
_______
)062,642(
_______
)062,642(
_______
Balance at 31st March 2011
307,826
756,980
4,674
59,834
2,809,288
3,938,602
Total comprehensive income
For the year ended 31st March 2012
-
-
Issue of new shares
31,746
168,254
Share based payment expense
sdnediviD
-
-
-
-
-
-
-
-
-
-
-
-
1,316,985
1,316,985
-
200,000
92,023
92,023
)344,144(
)344,144(
Reallocation on winding up of a subsidiary
-
_______
-
_______
-
_______
(59,834)
_______
59,834
_______
-
_______
Balance at 31st March 2012
339,572
_______
925,234
_______
4,674
_______
-
_______
3,836,687
_______
5,106,167
_______
The notes on pages 18 to 49 form part of these financial statements.
14
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
at 31st March 2012
setoN
£
£
£
£
2012
2011
Solid State PLC
Company Number: 00771335
STESSA
STESSA TNERRUC-NON
tnempiuqe dna tnalp ,ytreporP
stessa elbignatnI
TOTAL NON-CURRENT ASSETS
STESSA TNERRUC
seirotnevnI
selbaviecer rehto dna edarT
stnelaviuqe hsac dna hsaC
STESSA TNERRUC LATOT
STESSA LATOT
SEITILIBAIL
SEITILIBAIL TNERRUC
tfardrevo knaB
selbayap rehto dna edarT
sgniworrob knaB
seitilibail xat noitaroproC
01
11
41
51
071,158
975,524,2
________
3,276,749
657,316
816,473,2
________
2,988,374
500,260,3
086,278,6
868,14
________
276,567,2
396,412,4
300,37
________
355,679,9
_________
203,352,31
_________
863,350,7
_________
247,140,01
_________
61
71
599,763,1
765,563,5
714,460,1
353,162
________
232,184
021,119,3
469,481,1
628,852
________
TOTAL CURRENT LIABILITIES
8,059,332
5,836,142
81
02
-
308,78
________
000,002
899,66
________
NON CURRENT LIABILITIES
sgniworroB
ytilibail xat derrefeD
TOTAL NON-CURRENT LIABILITIES
SEITILIBAIL LATOT
STESSA TEN LATOT
CAPITAL AND RESERVES ATTRIBUTABLE TO EQUITY
TNERAP EHT FO SREDLOH
latipac erahS
evreser muimerp erahS
evreser noitpmeder latipaC
evreser egnahcxe ngieroF
sgninrae deniateR
12
22
22
22
22
YTIUQE LATOT
87,803
________
531,741,8
________
761,601,5
________
275,933
432,529
476,4
-
786,638,3
________
761,601,5
________
266,998
________
041,301,6
________
206,839,3
________
628,703
089,657
476,4
438,95
882,908,2
________
206,839,3
________
The financial statements were approved by the Board of Directors and authorised for issue on 20th June 2012 and
were signed on its behalf by:
P. Haining, Director
G S Marsh, Director
The notes on pages 18 to 49 form part of these financial statements.
15
Solid State PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31st March 2012
2012
2011
£
£
£
£
SEITIVITCA GNITAREPO
noitaxat erofeb tiforP
:rof stnemtsujdA
noitaicerpeD
noitasitromA
Loss/(profit) on disposal of property, plant and equipment
esnepxe tnemyap desab erahS
stsoc ecnaniF
noitisiuqca no niaG
segnahc erofeb snoitarepo morf tiforP
snoisivorp dna latipac gnikrow ni
seirotnevni ni )esaercnI(
(Increase) in trade and other receivables
Increase in trade and other payables
snoitarepo morf detareneg hsaC
diap sexat emocnI
seitivitca gnitarepo morf wolf hsaC
SEITIVITCA GNITSEVNI
Purchase of property, plant and equipment
erawtfos retupmoc fo esahcruP
Proceeds of sales from property, plant and equipment
Consideration paid on acquisition of subsidiary
Consideration paid on acquisition of business
Cash within subsidiary over which control has
deniatbo neeb
SEITIVITCA GNICNANIF
serahs yranidro fo eussI
deviecer naol mret muideM
gnirotcaf tbed fo tnemyapeR
esael ecnanif fo tnemyapeR
Invoice discounting finance (net movement)
diap tseretnI
Dividend paid to equity shareholders
(DECREASE) IN CASH AND CASH
STNELAVIUQE
693,342,1
391,311
080,22
(6,179)
881,61
051,35
-
________
828,144,1
)338,788(
_______
599,355
)934,411(
_______
655,934
)995,494(
_______
)340,55(
441,995,1
877,691
351,43
8,095
320,29
806,76
)782,061(
________
415,738,1
)333,69(
(2,657,987)
1,147,734
________
)055,628(
(1,268,263)
1,216,980
________
)685,606,1(
_______
829,032
)628,852(
_______
)934,411(
_______
)628,852(
_______
)898,72(
)104,064(
_______
)992,884(
(483,553)
)777,31(
70,466
(225,263)
-
825,751
_______
-
000,002
)009,552(
)350,6(
121,261
)051,35(
(246,260)
_______
(288,787)
)411,8(
36,500
-
(200,000)
-
_______
000,002
-
-
-
(120,548)
)806,76(
(441,443)
_______
)995,924(
_______
)898,719(
_______
)201,042(
_______
)541,592(
_______
The notes on pages 18 to 49 form part of these financial statements.
16
Solid State PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31st March 2012 (continued)
Cash and cash equivalents comprise:
2012
£
2011
£
stnelaviuqe hsac dna hsac ni )esaerced( teN
)898,719(
)541,592(
raey fo gninnigeb ta stnelaviuqe hsac dna hsaC
)922,804(
)297,711(
stnelaviuqe hsac dna hsac no sniag egnahcxE
raey fo dne ta stnelaviuqe hsac dna hsaC
There were no significant non-cash transactions.
dnamed no elbaliava hsaC
stfardrevO
-
_________
)721,623,1(
_________
807,4
_______
)922,804(
_______
2012
£
2011
£
868,14
)599,763,1(
_________
)721,623,1(
_________
300,37
)232,184(
_______
)922,804(
_______
17
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012
1.
ACCOUNTING POLICIES AND CRITICAL ACCOUNTING JUDGEMENTS
The principal accounting policies adopted in the preparation of the financial statements are set out below.
The policies have been consistently applied to all the years presented, unless otherwise stated.
These financial statements have been prepared in accordance with International Financial Reporting
Standards, International Accounting Standards and Interpretations issued by the International Accounting
Standards Board as adopted by the European Union (“IFRSs”) and with those parts of the Companies Act
2006 applicable to companies preparing their accounts under IFRSs. The consolidated financial statements
have been prepared under the historical cost convention.
As allowed by IFRS 1, we have elected not to apply IFRS retrospectively for business combinations
computed prior to 1st April 2006 and have used the carrying value of goodwill resulting from business
combinations occurring before the date of transition as deemed costs, subjecting this to impairment reviews
at the date of transition (1st April 2006) and at the end of each financial year thereafter.
Basis of Consolidation
Where the company has the power, either directly or indirectly, to govern the financial and operating policies
of another entity or business so as to obtain benefits from its activities, it is classified as a subsidiary. The
consolidated financial statements present the results of the company and its subsidiaries (“the Group”) as if
they formed a single entity. Intercompany transactions and balances between Group companies are therefore
eliminated in full.
Business Combinations
The consolidated financial statements incorporate the results of business combinations using the purchase
method other than disclosed above. In the consolidated balance sheet, the acquiree’s identifiable assets,
liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The
results of acquired operations are included in the consolidated statement of comprehensive income from the
date on which control is obtained.
Goodwill
Goodwill represents the excess of the cost of a business combination over the interest in the fair value of
identifiable assets, liabilities and contingent liabilities acquired. Cost comprises the fair value of assets
given, liabilities assumed and equity instruments issued.
Goodwill is capitalised as an intangible asset with any impairment in carrying value being charged to the
income statement.
Any gains on acquisition are recognised in the statement of comprehensive income on the date of acquisition.
Impairment of non-financial assets
Impairment tests on goodwill are undertaken annually on 31st March, and on other non-financial assets
whenever events or changes in circumstances indicate that their carrying value may not be reasonable.
Where the carrying value of an asset exceeds its recoverable amount (ie the higher of value in use and fair
value less costs to sell), the asset is written down accordingly.
Impairment charges are included in the administrative expenses line item in the consolidated statement of
comprehensive income, except to the extent that they reverse gains previously recognised in the consolidated
statement of recognised income and expense. An impairment loss recognised for goodwill is not reversed.
18
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
1.
ACCOUNTING POLICIES AND CRITICAL ACCOUNTING JUDGEMENTS (continued)
Intangible Assets (other than goodwill)
Intangible assets are recognised on business combinations if they are separable from the acquired entity or arise
from other contractual/legal rights. The amounts ascribed to such intangibles are arrived at by using appropriate
valuation techniques.
Externally acquired intangible assets are initially recognised at cost and subsequently amortised on a straight line
basis over their useful economic lives. Cost includes all directly attributable costs of acquisition. The
amortisation expense is included within the administration expense line in the consolidated statement of
comprehensive income. Software is amortised over its useful economic life of 5 years and other intangible assets
over their useful economic life of 10 years.
Intangible assets are subject to impairment tests whenever events or changes in circumstances indicate that their
carrying value may not be recoverable.
Revenue
Revenue represents sales to external customers at invoiced amounts less value added tax or local taxes on sales.
Revenue is recognised when the risks and rewards of owning the goods has passed to the customer which is
generally on collection. For goods that are subject to bill and hold arrangements this means:
the goods are complete and ready for collection;
the goods are separately identified from the Group’s other stock and are not used to fulfil any other orders;
•
•
• and the customer has specifically requested that the goods be held pending collection.
Normal payment terms apply to the bill and hold arrangements.
Property, plant and equipment
Items of property, plant and equipment are initially recognised at cost. As well as the purchase price, cost
includes directly attributable costs.
Depreciation is provided on all items of property, plant and equipment to write off the carrying value of items
over their expected useful economic lives. It is applied at the following rates:
Short leasehold property improvements- straight line over minimum life of lease
Fittings and equipment- 25% per annum on a reducing balance basis
Computers- 20% per annum on a straight line basis
Motor vehicles- 25% per annum on a reducing balance basis
Depreciation is provided on all UN licences to write off the carrying value of each licence over its expected
useful life, which is generally 10 years from its original grant.
Leased assets
Where substantially all of the risks and rewards incidental to ownership are retained by the lessor (an “operating
lease”), the total rentals payable under the lease are charged to the statement of comprehensive income on a
straight-line basis over the lease term.
The land and buildings elements of property leases are considered separately for the purposes of lease
classification.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is based on the cost of purchase on a first
in, first out basis. Work in progress and finished goods include labour and attributable overheads. Net realisable
value is based on estimated selling price less any additional costs to completion and disposal.
19
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
1.
ACCOUNTING POLICIES AND CRITICAL ACCOUNTING JUDGEMENTS (continued)
Deferred taxation
Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the balance
sheet differs from its tax base, except for differences arising on:
(cid:129)
(cid:129)
(cid:129)
the initial recognition of goodwill
the initial recognition of an asset or liability in a transaction which is not a business combination and at
the time of the transaction affects neither accounting nor taxable profit: and
investments in subsidiaries and jointly controlled entities where the Group is able to control the timing
of the reversal of the difference and it is probable the difference will not reverse in the foreseeable
future.
Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be
available against which the differences can be utilised.
The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted
by the balance sheet date and are expected to apply when the deferred tax liabilities/(assets) are
settled/(recovered)
Deferred tax assets and liabilities are offset when the Group has a legally enforceable right to offset current tax
assets and liabilities, and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
Pensions
The pension schemes operated by the Group are defined contribution schemes. The pension cost charge
represents the contributions payable by the Group.
Foreign currency
Transactions entered into by Group entities in a currency other than the currency of the primary economic
environment in which it operates are recorded at the rates ruling when the transactions occur. Foreign currency
monetary assets and liabilities are retranslated at the rates ruling at the balance sheet date. Exchange differences
arising are recognised in the statement of comprehensive income.
On consolidation, the statement of financial position of overseas operations are translated into sterling at rates
approximating to those ruling at the statement of financial position date. Exchange differences arising on
retranslation of the net assets and results of the overseas operations are recognised directly in the “foreign
exchange reserve”.
Research and development costs
Expenditure on internally developed products is capitalised if it can be demonstrated that:
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
it is technically feasible to develop the product for it to be sold;
adequate resources are available to complete the development;
there is an intention to complete and sell the product;
the Group is able to sell the product;
sale of the product will generate future economic benefits; and
expenditure on the project can be measured reliably.
Capitalised development costs are amortised over the periods the Group expects to benefit from selling the
products developed. The amortisation expense is included within the cost of sales line in the statement of
comprehensive income.
Development expenditure not satisfying the above criteria and expenditure on the research phase of internal
projects are recognised in the statement of comprehensive income as incurred.
None of the development costs during the years ended 31st March 2011 and 31st March 2012 met the conditions
necessary for capitalisation.
20
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
1.
ACCOUNTING POLICIES AND CRITICAL ACCOUNTING JUDGEMENTS (continued)
Dividends
Equity dividends are recognised when they become legally payable. Interim dividends are recognised when paid.
Final dividends are recognised when approved by the shareholders at an annual general meeting.
Financial assets
The Group classifies its assets into one of the following categories, depending on the purpose for which the asset
was acquired. The Group’s accounting policy for each category is as follows:
Fair value through profit or loss: This category comprises only in-the-money derivatives. They are carried in the
statement of financial position at fair value with changes in fair value recognised in the statement of
comprehensive income. Other than derivatives, the Group does not have any assets held for trading nor does it
voluntarily classify any financial assets as being at fair value through the profit and loss account
Loans and receivables: These assets are non-derivative financial assets with fixed or determinable payments that
are not quoted in an active market. They arise principally through the provision of goods and services to
customers (trade receivables), but also incorporate other types of contractual monetary asset. They are initially
recognised at fair value plus transaction costs that are directly attributable to the acquisition or issue and
subsequently carried at amortised cost using the effective interest rate method, less provision for impairment.
The effect of discounting on these financial instruments is not considered to be material.
Impairment provisions are recognised when there is objective evidence (such as significant financial difficulties
on the part of the counterparty or default or significant delay in payment) that the Group will be unable to collect
all the amounts due under the terms receivable, the amount of such a provision being the difference between the
net carrying amount and the present value of the future expected cash flows associated with the impaired
receivable. For trade receivables, such provisions are recorded in a separate allowance account with the loss
being recognised within administrative expenses in the income statement. On confirmation that the trade
receivable will not be collectable, the gross carrying value of the asset is written off against the associated
provision.
Financial liabilities
The Group classifies its financial liabilities into one of two categories, depending on the purpose for which the
liability was acquired. Other than financial liabilities in a qualifying hedging relationship (see below), the
Group’s accounting policy for each category is as follows:
Fair value through the profit and loss: This category comprises only out-of-money derivatives. They are carried
in the statement of financial position at fair value with changes in fair value recognised in the statement of
comprehensive income.
Other financial liabilities: Other financial liabilities include the following items:
(cid:129) Trade payables and other short term monetary liabilities, which are recognised at amortised cost.
(cid:129) Bank borrowings are initially recognised at the amount advanced net of any transaction costs directly
attributable to the issue of the instrument. Such interest bearing liabilities are subsequently measured at
amortised cost using the effective interest rate method, which ensures that any interest expense over the
period to repayment is at a constant rate on the balance of liability carried in the statement of financial
position “Interest expense” in this context includes initial transaction costs and premia payable on
redemption, as well as any interest while the liability is outstanding.
21
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
1.
ACCOUNTING POLICIES AND CRITICAL ACCOUNTING JUDGEMENTS (continued)
Shared based payment
Where share options are awarded to employees, the fair value of the options at the date of grant is charged to the
consolidated statement of comprehensive income over the vesting period. Non-market vesting conditions are
taken into account by adjusting the number of equity instruments expected to vest at each statement of financial
position date so that, ultimately, the cumulative amount recognised over the vesting period is based on the
number of options that eventually vest. Market vesting conditions are factored into the fair value of options
granted. As long as all other vesting conditions are satisfied, a charge is made irrespective of whether the market
vesting conditions are satisfied. The cumulative expense is not adjusted for failure to achieve a market vesting
condition.
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the
options, measured immediately before and after the modification, is also charged to the statement of
comprehensive income over the remaining vesting period.
Standards and amendments and interpretations to published standards not yet effective
Certain new standards, amendments and interpretations to existing standards have been published that are
mandatory for the group’s accounting periods beginning on or after 1st April 2013 or later periods and which the
group has decided not to adopt early are:
IFRS 9 Financial Instruments (effective for accounting periods beginning or after 1st January 2015). IFRS 9
introduces new requirements for classifying and measuring financial assets and liabilities.
IFRS 10 Consolidated Financial Statements (effective for accounting periods beginning on or after 1st
January 2013). IFRS 10 establishes principles for the presentation and preparation of consolidated financial
statements when an entity controls one or more entities.
IFRS 11 Joint Arrangements (effective for accounting periods beginning on or after 1st January 2013). IFRS
11 focuses on the rights and obligations of joint arrangements, rather than its legal form.
IFRS 12 Disclosure of Interests in Other Entities (effective for accounting periods beginning on or after 1st
January 2013). IFRS 12 introduces new disclosure requirements for all forms of interests in other entities
including subsidiaries, joint arrangements, associates and unconsolidated structured entities.
IFRS 13 Fair Value Measurement (effective for accounting periods beginning on or after 1st January 2013).
IFRS 10 establishes a single framework for all fair value measurements when fair value is required or permitted
by IFRS.
IAS 1 (amended) Presentation of Items of Other Comprehensive Income (effective for accounting periods
beginning on or after 1st January 2015) IAS 1 prescribes the basis for presentation of general purpose financial
information to ensure comparability with the entity’s financial statements of previous periods and with financial
statements of other entities.
IAS 12 (amended) Deferred Tax: Recovery of Underlying Assets (effective for accounting periods beginning
on or after 1st January 2012).IAS 12 prescribes the accounting treatment for income taxes.
IAS 19 (revised) Employee Benefits (effective for accounting periods beginning on or after 1st January 2013)
IAS 19 prescribes the accounting and disclosure for employee benefits i.e. all forms of consideration given by an
entity in exchange for service rendered by an employee.
IAS 27 (revised) Separate Financial Statements (effective for accounting periods beginning on or after 1st
January 2013) IAS 27 assists in the preparation and presentation of consolidated financial statements for a group
of entities under the control of a parent and in accounting for investments in subsidiaries, jointly controlled
entities and associates when an entity elects, or is required by local regulations to present separate (non
consolidated) financial statements.
22
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
1.
ACCOUNTING POLICIES AND CRITICAL ACCOUNTING JUDGEMENTS (continued)
The implementation of these standards is not expected to have any material effect on the Group’s financial
statements.
2.
REVENUE
Revenue arises from:
sdoog fo elaS
secivres fo noisivorP
3.
PROFIT FROM OPERATIONS
This has been arrived at after charging/(crediting):
)4 eton ees( stsoc ffatS
Employment termination costs (included in staff costs)
tnempiuqe dna tnalp ,ytreporp fo noitaicerpeD
Amortisation of computer software and other intangible assets
Loss/(profit) on disposal of property, plant and equipment
:noitarenumer ’srotiduA
seef tiduA
Audit of accounts of associates of the company pursuant to legislation
:slatner esael gnitarepO
yrenihcam dna tnalP
rehtO
stsoc tnempoleved dna hcraeseR
secnereffid egnahcxe ngieroF
snwod etirw kcotS
2012
£
2011
£
681,287,52
569,19
_________
587,570,12
325,39
_________
151,478,52
_________
803,961,12
_________
2012
£
066,470,4
105,460
877,691
34,153
8,095
005,5
32,000
005,14
349,202
014,871
)195,812(
000,031
_______
2011
£
571,020,3
78,110
391,311
22,080
(6,179)
000,1
35,002
569,12
771,241
216,411
)728,212(
000,261
_______
The foreign exchange differences have been treated as a reduction in cost of sales rather than as a negative
overhead.
4.
STAFF COSTS
Staff costs for all employees during the year, including the executive Directors, were as follows:
seiralas dna segaW
stsoc ytiruces laicoS
stsoc noisnep rehtO
23
2012
£
536,076,3
390,493
239,9
________
066,470,4
________
2011
£
379,176,2
466,882
835,95
________
571,020,3
________
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
4.
STAFF COSTS (continued)
Wages and salaries include termination costs of £105,460 (2011: £78,110)
The average monthly number of employees during the year, including the three executive Directors, was as
follows:
noitubirtsid dna gnilleS
gnirutcafunaM
noitartsinimda dna tnemeganaM
2012
Number
2011
Number
23
72
73
__
69
__
92
02
82
__
77
__
5.
DIRECTORS’ EMOLUMENTS, INTERESTS AND SERVICES CONTRACTS
The value of all elements of remuneration received by each Director in the year was as follows:
Salary/
Fees
Salary/
Fees
£
Benefits
Bonuses
Bonuses
in kind
£
£
£
£
Benefits
Total
in kind
emoluments
£
£
Total
Pension
emoluments
contributions
£
£
Pension
contributions
Total
£
Total
£
£
31st March 2012
W G Marsh
G S Marsh
J M Lavery
J L Macmichael
P Haining
G L Comben
ererF B A
Total
31st March 2011
W G Marsh
G S Marsh
J M Lavery
J L Macmichael
P Haining
L C A Newnham
G L Comben
A B Frere
m
Total
54,000
54,000
264,000
264,000
259,000
259,000
182,000
182,000
19,000
19,000
53,000
53,000
-
-
______
______
831,000
______
831,000
______
17,000
222,000
181,000
90,000
15,000
9,000
19,000
15,000
______
17,000
222,000
181,000
90,000
15,000
9,000
19,000
15,000
______
568,000
______
568,000
______
54,000
-
54,000
-
- 264,000
- 264,000
2,000 261,000
2,000 261,000
- 182,000
- 182,000
19,000
-
19,000
-
53,000
-
53,000
-
-
-
-
-
______
______
______
______
2,000
______
2,000
______
833,000
______
833,000
______
17,000
-
17,000
-
- 222,000
- 222,000
48,000 229,000
48,000 229,000
90,000
-
90,000
-
15,000
-
15,000
-
9,000
-
9,000
-
19,000
-
19,000
-
-
15,000
15,000
-
______
______
______
______
48,000
______
48,000
______
616,000
______
616,000
______
36,000
36,000
125,000
125,000
120,000
120,000
85,000
85,000
19,000
19,000
36,000
36,000
-
-
______
______
18,000
-
18,000
-
14,000
125,000
14,000
125,000
19,000
120,000
19,000
120,000
18,000
79,000
18,000
79,000
-
-
-
-
17,000
-
17,000
-
-
-
-
-
______
______
______
______
421,000
______
421,000
______
324,000
______
324,000
______
86,000
______
86,000
______
12,000
110,000
100,000
75,000
15,000
9,000
6,000
15,000
______
12,000
110,000
100,000
75,000
15,000
9,000
6,000
15,000
______
5,000
-
5,000
-
12,000
100,000
12,000
100,000
16,000
65,000
16,000
65,000
10,000
5,000
10,000
5,000
-
-
-
-
-
-
-
-
13,000
-
13,000
-
-
-
-
-
______
______
______
______
342,000
______
342,000
______
170,000
______
170,000
______
56,000
______
56,000
______
24
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
5. DIRECTORS’ EMOLUMENTS, INTERESTS AND SERVICES CONTRACTS
(continued)
The executive Directors waived their entitlement to emoluments during the year as follows:
hsraM G W
2102
£
1102
£
-
______
000,42
______
The principal benefits in kind relate to the provision of company cars.
In addition to the above, fees totalling £63,345 (2011: £56,000) arose during the year in respect of accountancy
services provided by The Kings Mill Partnership, a firm of which P Haining is a partner. A balance of £7,458
(2011: £14,472) was due to The Kings Mill Partnership at 31st March 2012.
Fees totalling £16,053 (2011: £Nil) arose during the year in respect of the services of A B Frere provided by
Condev Limited. A balance of £1,938 (2011: £Nil) was due to Condev Limited at 31st March 2012.
The executive Directors have service contracts with the Company which are terminable by the Company, or
the relevant Director, on one year’s notice.
The Directors of the Company on 20th June 2012 and at the statement of financial position date, and their
interest in the issued ordinary share capital of the Company at that date, at 31st March 2012 and 31st March
2011 or date of appointment if later, were as follows:
nebmoC L G
hsraM G W
hsraM S G
yrevaL M J
gniniaH P
leahcimcaM L J
ererF B A
20.06.12
31.03.12
31.03.11
000,000,2
000,884,1
291,193
543,813
005,25
000,11
000,65
000,000,2
000,884,1
291,193
543,813
005,25
000,11
000,65
601,517,2
000,886,1
907,37
068
005,21
-
-
Details of the options over the Company’s shares granted under the Enterprise Management Incentives Scheme
are as follows:
snoitpO
ta dleh
desicrexE 11.40.10
detnarG
snoitpO
ta dleh
21.30.13
esicrexE
ecirp
fo etaD
tnarg
esicrexE
doirep
G S Marsh
317,460
317,460
120,603
120,603
99.5p
10.05.11
May 2012- March 2016
J M Lavery
317,460
317,460
120,603
120,603
99.5p
10.05.11 May 2012- March 2016
J L Macmichael
60,000
-
-
-
-
88,085
60,000
88,085
62.0p
94.0p
23.12.10
01.04.11
December 2011 onwards
April 2012 onwards
The market price of the shares at 31st March 2012 was £1.96 (2011: 99p), with a quoted range during the
year of 94.5p to £1.96.
All the options at 31st March 2012 are subject to performance criteria.
25
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
5. DIRECTORS’ EMOLUMENTS, INTERESTS AND SERVICES CONTRACTS
(continued)
The options held by G S Marsh and J M Lavery are split into two equal tranches. For the first tranche to be
exercisable, Solid State PLC’s ordinary share price needs to have exceeded £2.00 per share for 20 consecutive
days and for the second tranche to be exercised the ordinary share price needs to have exceeded £2.50 per
share for 20 consecutive days.
The options held by J Macmichael are subject to Solid State Supplies Limited exceeding a certain level of
annual turnover. The first option over 60,000 shares is dependent on the annual turnover exceeding £4m. The
second options are split into two equal tranches. For the first tranche to be exercisable, the annual turnover
must exceed £5m and for the second tranche the annual turnover must exceed £6m. At the balance sheet date
all these criteria had been met.
6. FINANCE COSTS
sgniworrob knaB
tseretni gnitnuocsid eciovnI
tseretni rehtO
2012
£
443,72
481,62
080,41
______
67,608
______
2011
£
142,81
440,12
568,31
______
53,150
______
Other interest includes £9,000 (2011: £8,798) to G L Comben and £5,080 (2011: £2,850) to W G Marsh in
Other interest includes £9,000 (2011: £8,798) to G L Comben and £5,080 (2011: £2,850) to W G Marsh in
respect of their unsecured loans to the group. Further details of these loans are stated in Note 18 on page 33.
respect of their unsecured loans to the group. Further details of these loans are stated in Note 18 on page 31.
7. TAX EXPENSE
Current tax expense
UK corporation tax and income tax of overseas operations on
raey eht rof sessol ro stiforp
sdoirep roirp fo tcepser ni tnemtsujdA
Deferred tax expense
Total tax charge
2012
£
2011
£
353,162
-
_______
628,852
)573,4(
______
261,353
254,451
20,806
_______
282,159
_______
20,461
_______
274,912
_______
The deferred tax expense has been reduced by £4,883 (2011: £5,l39) as a result of the reduction in the
applicable rate of corporation tax from 26% to 24%.
26
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
7.
TAX EXPENSE (continued)
The reasons for the difference between the actual tax charge for the year and the standard rate of corporation
tax in the UK applied to profits for the year are as follows:
xat erofeb tiforP
Expected tax charge based on the standard rate of
corporation tax in the UK of 26% (2011 – 28%)
Effect of:
sesoprup xat rof elbitcuded ton sesnepxE
Deductible expenses not charged in Group accounts
Difference between depreciation for the year and capital allowances
Tax relief on exercise of share options at less than market value
Timing difference on recognition of gain on acquisition for tax purposes
sessol xat fo noitasilitU
feiler lanigraM
Enhanced relief on research and development expenditure
Adjustment to enhanced relief on research and development
raey roirp ni erutidnepxe
egrahc xat latoT
8. EARNINGS PER SHARE
The earnings per share is based on the following:
sgninraE
serahs fo rebmun egareva dethgieW
serahs fo rebmun detuliD
erahs rep sgninraE
erahs rep sgninrae detuliD
2012
£
2011
£
441,995,1
_______
693,342,1
_______
415,777
348,151
805,82
(5,308)
(26)
(104,825)
(1,600)
-
)005,4(
(45,867)
-
_______
951,282
_______
875,11
(9,649)
1,065
-
-
)594,64(
)592,1(
(24,068)
)573,4(
_______
219,472
_______
2012
£
2011
£
589,613,1
_________
484,869
_______
316,077,6
252,078,6
115,651,6
843,444,6
p5.91
p2.91
p7.51
p0.51
Earnings per ordinary share has been calculated using the weighted average number of shares in issue during
the year. The weighted average number of equity shares in issue was 6,770,613 (2011: 6,156,511).
The Diluted earnings per share is based on 6,870,252 (2011: 6,444,348) ordinary shares which allow for the
exercise of all dilutive potential ordinary shares.
In the prior year, certain employee options were not included in the calculation of diluted EPS because their
exercise was contingent on the satisfaction of certain criteria that had not been met at the end of the year. In
addition, certain employee options were also excluded from the calculation of diluted EPS as their exercise
price was greater than the weighted average share price during the year (ie they are out-of-the-money) and
therefore it would not be advantageous for the holders to exercise the options.
The number of share options which have not been included in the calculation of the weighted average number
of shares was nil (2011: 60,000).
27
Solid State PLC
9. DIVIDENDS
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Final dividend paid for the prior year of 4p per share (2011: 2p)
)p2 :1102( erahs rep p5.2 fo diap dnedivid miretnI
Final dividend proposed for the year 4.75p per share (2011: 4p)
2012
£
271,657
687,961
_______
441,443
_______
322,593
_______
2011
£
123,130
031,321
_______
246,260
_______
271,657
_______
The proposed final dividend has not been accrued for as the dividend was declared after the statement of
financial position date.
28
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
10. PROPERTY, PLANT AND EQUIPMENT
Solid State PLC
Year ended 31st March 2011
tsoC
0102 lirpA ts1
snoitiddA
yraidisbus fo noitisiuqcA
slasopsiD
1102 hcraM ts13
noitaicerpeD
0102 lirpA ts1
raey eht rof egrahC
lasopsid nO
1102 hcraM ts13
eulav koob teN
1102 hcraM ts13
Year ended 31st March 2012
tsoC
1102 lirpA ts1
snoitiddA
slasopsiD
2102 hcraM ts13
noitaicerpeD
1102 lirpA ts1
raey eht rof egrahC
lasopsid nO
2102 hcraM ts13
eulav koob teN
2102 hcraM ts13
trohS
dlohesael
ytreporp
rotoM
selcihev stnemevorpmi
sgnittiF
dna tnempiuqe
sretupmoc
£
£
£
latoT
£
671,552
133,991
-
)671,552(
_______
970,992
381,432
-
)232,531(
_______
561,429
930,05
938,7
)008,2(
_______
024,874,1
355,384
938,7
)802,393(
________
133,991
_______
030,893
_______
342,979
_______
406,675,1
________
671,552
274,8
)671,552(
_______
658,69
461,56
)587,17(
_______
445,628
755,93
)069,1(
_______
675,871,1
391,311
)129,823(
________
274,8
_______
532,09
_______
141,468
_______
848,269
________
958,091
_______
597,703
_______
201,511
_______
657,316
________
133,991
543,91
-
030,893
050,491
)578,06(
342,979
293,562
-
406,675,1
787,874
)578,06(
_______
_______
_______
________
676,812
_______
502,135
_______
536,442,1
_______
615,499,1
________
274,8
168,43
-
_______
532,09
093,99
)082,61(
_______
141,468
725,26
-
_______
848,269
877,691
)082,61(
________
333,34
_______
543,371
_______
866,629
_______
643,341,1
________
343,571
_______
068,753
_______
769,713
_______
071,158
________
At 31 March 2011 the Group was committed to purchase a motor vehicle at a cost of £42,627.
29
Solid State PLC
11. INTANGIBLE ASSETS
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
NU
secneciL
£
retupmoC
erawtfos
£
no lliwdooG
noitadilosnoc
£
Other
elbignatni
stessa
£
latoT
£
Year ended 31st March 2011
1st April 2010
snoitiddA
Acquisition of subsidiary
9,800
-
-
42,312
777,31
-
1,992,737
-
213,541
-
-
140,434
2,044,849
777,31
353,975
_____
______
________
_______
________
31st March 2011
9,800
56,089
2,206,278
140,434
2,412,601
_____
______
________
_______
________
noitasitromA
0102 lirpA ts1
Charge for the year
31st March 2011
eulav koob teN
31st March 2011
Year ended 31st March 2012
tsoC
1st April 2011
snoitiddA
31st March 2012
noitasitromA
1102 lirpA ts1
Charge for the year
31st March 2012
eulav koob teN
31st March 2012
-
-
_____
-
_____
9,800
_____
9,800
-
_____
9,800
_____
-
-
_____
-
_____
9,800
_____
309,51
8,037
______
23,940
______
32,149
______
56,089
411,58
_______
141,203
_______
049,32
20,110
______
44,050
______
97,153
______
-
-
________
-
________
2,206,278
________
2,206,278
-
________
2,206,278
________
-
-
________
-
________
2,206,278
________
-
14,043
_______
309,51
22,080
________
14,043
_______
37,983
________
126,391
_______
2,374,618
________
140,434
-
_______
2,412,601
411,58
________
140,434
_______
2,497,715
________
340,41
14,043
_______
389,73
34,153
________
28,086
_______
72,136
________
112,348
_______
2,425,579
________
Other intangible assets comprise the estimated net present value of customer relationships of Rugged Systems
Limited at the date of acquisition.
30
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
12. GOODWILL AND IMPAIRMENT
Details of the carrying amount of goodwill allocated to cash generating units (CGUs) is as follows:
detimiL etitaetS
detimiL smetsyS degguR
tnuoma gniyrrac lliwdooG
2012
£
2011
£
872,602,2
-
________
737,299,1
145,312
________
2,206,278
________
2,206,278
________
The recoverable amounts of all the above CGUs have been determined from a review of the current and
anticipated performance of these units. In preparing the projection, a discount rate of 15% (2011: 15%) has
been used based on the weighted average cost of capital and a future growth rate of 2.25% has been assumed
beyond the first year for which the projection is based on the budget approved by the board of directors. The
future growth rate has been applied for the next four years. It has been assumed investment in capital
equipment will equate to depreciation over this period. The discount rate was based on the group’s “beta”
which is a measure of the volatility of the share price against the market. This amounts to 0.84 (2011: 0.84).
The recoverable amount exceeds the carrying amount by £9,719,000 (2011: £7,666,000). If any one of the
following changes were made to the above key assumptions, the carrying amount would still exceed the
recoverable amount.
Discount rate: Increase from 15% to 18%
Growth rate: Reduction from 2.25% to 1.75%
13. SUBSIDIARIES
The principal subsidiaries of Solid State PLC, all of which have been included in these consolidated financial
statements are as follows:
In all cases the country of operation and of incorporation or registration is England.
With effect from 1st April 2012 the trade of Steatite Blazepoint Limited has been transferred to Steatite
Limited and the company became dormant.
31
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
14. INVENTORIES
elaser rof sdoog dna sdoog dehsiniF
ssergorp ni kroW
2012
£
591,457,2
018,703
________
500,260,3
________
2011
£
399,293,2
976,273
________
276,567,2
________
There is no material difference between the replacement cost of inventories and the amount stated above.
15. TRADE AND OTHER RECEIVABLES
selbaviecer edarT
selbaviecer rehtO
stnemyaperP
2012
£
943,915,6
-
133,353
________
086,278,6
________
2011
£
414,678,3
808,2
174,533
________
396,412,4
________
Group trade receivables include £1,572,639 (2011: £1,768,843) which are subject to an invoice discounting
agreement. Under this agreement, borrowing equal to 85% of the relevant book debts can be taken with
interest charged at 2% over bank base rate and an administration fee of 0.175% of the gross value of the debts
per month. At 31st March 2012 borrowing under the agreement of £1,280,235 (2011: £1,348,700) was
available of which £1,064,417 (2011: £1,184,164) was taken up. Interest charges in the year amounted to
£26,184 (2011: £21,044) and administration fees to £22,935 (2011: £30,826).
16. TRADE AND OTHER PAYABLES (CURRENT)
selbayap edarT
sexat ytiruces laicos dna sexat rehtO
selbayap rehtO
slaurccA
emocni derrefeD
2012
£
552,061,3
276,708
773,946
571,745
880,102
________
765,563,5
________
2011
£
871,086,2
291,394
576,902
760,023
800,802
________
021,119,3
________
32
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
17. BANK BORROWINGS
sretnuocsid eciovni ot eud stnuomA
Solid State PLC
2012
£
2011
£
714,460,1
________
469,481,1
________
The bank overdraft is secured by a fixed and floating charge over the assets of the Company and the Group.
At the balance sheet date, the Group had an undrawn overdraft facility of £632,000 (2011: £608,000).
18. TRADE AND OTHER PAYABLES (NON CURRENT)
snaol mret muideM
2012
£
2011
£
-
_______
000,002
________
At 31st March 2011, the medium term loans comprised loans of £150,000 from G L Comben and £50,000
from W G Marsh. At 31st March 2012, loans of £150,000 from G L Comben and £150,000 from W G Marsh
are included within other payables due within less than one year. The loans are unsecured and, for G L
Comben’s loan, interest is payable at the rate of 6% per annum and for W G Marsh’s loan, interest is payable
at the rate of 6% per annum on the first £50,000 and at 2% over base rate for the remainder. Both loans were
repaid on 21st May 2012.
19.
FINANCIAL INSTRUMENTS
The Group’s overall risk management programme seeks to minimise potential adverse effects on the Group’s
financial performance.
The Group’s financial instruments comprise cash and cash equivalents and various items such as trade
payables and receivables that arise directly from its operations. The Group is exposed through its operations to
the following risks:
(cid:129) Credit risk
(cid:129) Foreign currency risk
(cid:129) Liquidity risk
(cid:129) Cash flow interest rate risk
In common with all other businesses, the Group is exposed to risks that arise from its use of financial
instruments. This note describes the Group’s objectives, policies and processes for managing those risks.
Further quantitative information in respect of these risks is presented throughout these financial statements.
There have been no substantive changes in the Group’s exposure to financial instrument risks and
consequently the objectives, policies and processes are unchanged from the previous period.
The Board has overall responsibility for the determination of the Group’s risk management policies. The
objective of the Board is to set policies that seek to reduce the risk as far as possible without unduly affecting
the Group’s competitiveness and effectiveness. Further details of these policies are set out on the next page:
33
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
19.
FINANCIAL INSTRUMENTS (continued)
Credit risk
The Group is exposed to credit risk primarily on its trade receivables, which are spread over a range of
customers and countries, a factor that helps to dilute the concentration of the risk.
It is Group policy, implemented locally, to assess the credit risk of each new customer before entering into
binding contracts. Each customer account is then reviewed on an ongoing basis (at least once a year) based on
available information and payment history.
The maximum exposure to credit risk is represented by the carrying value in the statement of financial position
as shown in note 15 and in the statement of financial position. The amount of the exposure shown in note 15 is
stated net of provisions for doubtful debts.
The credit risk on liquid funds is low as the funds are held at banks with high credit ratings assigned by
international credit rating agencies.
Foreign currency risk
Foreign exchange transaction risk arises when individual Group operations enter into transactions denominated
in a currency other than their functional currency. The general policy for the Group is to sell to customers in
the same currency that goods are purchased in reducing the transactional risk. Where transactions are not
matched excess foreign currency amounts generated from trading are converted back to sterling and required
foreign currency amounts are converted from sterling and the use of forward currency contracts is considered.
Foreign exchange translation risk arises on translation of the balance sheets of Group operations whose
functional currency is different to that of the Group as a whole. The predominant area where this risk applies is
US dollars and Swiss francs.
Liquidity risk
The Group operates a Group overdraft facility common to all its trading companies and invoice discounting is
used on some sales to customers meaning that the UK business can receive immediate payment on its sales.
The Group has approximately a three month visibility in its trading and runs a rolling 3 month cash flow
forecast. If any part of the Group identifies a shortfall in its future cash position the Group has sufficient
facilities that it can direct funds to the location where they are required. If this situation is forecast to continue
into the future remedial action is taken.
Cash flow interest rate risk
External Group borrowings are approved centrally. The Board accepts that this neither protects the Group
entirely from the risk of paying rates in excess of current market rates nor eliminates fully cash flow risk
associated with interest payments. It considers, however, that by ensuring approval of borrowings is made by
the Board the risk of borrowing at excessive interest rates is reduced. The Board considers that the rates being
paid are in line with the most competitive rates it is possible for the Group to achieve.
Credit risk
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to
credit risk at the reporting date was:
Current financial assets
selbaviecer rehto dna edarT
stnelaviuqe hsac dna hsaC
34
Loans and Receivables
2011
£
2012
£
086,278,6
868,14
________
845,419,6
________
396,412,4
300,37
________
696,782,4
________
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
19. FINANCIAL INSTRUMENTS (continued)
The maximum exposure to credit risk for trade receivables at the reporting date by geographic region was:
KU
KU noN
Carrying value
2012
£
570,303,6
472,612
________
943,915,6
________
2011
£
331,308,3
182,37
________
414,678,3
________
The Group policy is to make a provision against those debts that are overdue, unless there are grounds for
believing that all or some of the debts will be collected. During the year the value of provisions made in
respect of bad and doubtful debts was £Nil (2011: £7,262) which represented 0% (2011: 0.03%) of revenue.
This provision is included within the management and administration costs in the Consolidated Statement of
Comprehensive Income.
Trade receivables ageing by geographical segment
Geographical area
2102
KU
KU noN
latoT
Total
£
Current
£
30 days
past due
£
60 days
past due
£
90 days
past due
£
311,193,6
390,532
________
162,890,6
946,491
________
368,572
526,12
_______
371,21
838,11
______
618,4
189,6
______
602,626,6
019,292,6
884,792
110,42
797,11
snoisivorP :sseL
)758,601(
-
)940,17(
)110,42(
)797,11(
latoT
943,915,6
019,292,6
934,622
-
-
________
________
_______
______
______
________
________
_______
______
______
2011
KU
KU noN
latoT
830,319,3
182,37
________
984,216,3
511,36
________
290,132
661,01
_______
357,11
-
______
407,75
-
______
913,689,3
406,576,3
852,142
357,11
407,75
snoisivorP :sseL
)509,901(
-
)844,04(
)357,11(
)407,75(
________
________
_______
______
______
latoT
414,678,3
________
406,576,3
________
018,002
______
-
______
-
______
35
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
19.
FINANCIAL INSTRUMENTS (continued)
The Group records impairment losses on its trade receivables separately from gross receivables. The
movements on this allowance account during the year are summarised below:
ecnalab gninepO
snoisivorp ni sesaercnI
snoisivorp tsniaga ffo nettirW
2012
£
509,901
758,6
)509,9(
_______
106,857
_______
2011
£
346,201
262,7
-
_______
109,905
_______
The main factor used in assessing the impairment of trade receivables is the age of the balances and the
circumstances of the individual customer.
As shown in the earlier table, at 31st March 2012 trade receivables of £226,439 which were past their due date
were not impaired (2011: £200,810). All of these were less than 60 days past their due date.
Liquidity risk
Current financial liabilities
selbayap rehto dna edarT
sgniworrob knaB
tfardrevo knaB
Non current financial liabilities
sgniworrob dna snaoL
Financial liabilities
measured at amortised cost
2012
£
765,563,5
714,460,1
599,763,1
________
979,797,7
________
-
________
2011
£
021,119,3
469,481,1
232,184
________
613,775,5
________
000,002
________
36
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
19.
FINANCIAL INSTRUMENTS (continued)
The following are maturities of financial liabilities, including estimated contracted interest payments.
lautcartnoC gniyrraC
tnuoma
wolf hsac
shtnom 6
ssel ro
21 – 6
shtnom
erom ro 1
sraey
2012
Secured bank loans
Bank overdrafts
Amounts due to invoice
discounters
Trade and other payables
2011
Secured bank loans
Bank overdrafts
Amounts due to invoice
discounters
Other loans
Trade and other payables
-
1,367,995
-
1,367,995
-
1,367,995
-
-
-
-
1,064,417
5,365,567
________
1,064,417
5,365,567
________
1,064,417
5,365,567
________
-
-
_______
-
_______
7
,797,979
________
7,797,979
________
7,797,979
________
-
_______
-
_______
-
481,232
-
481,232
-
481,232
-
-
-
-
1,184,964
200,000
3,911,120
________
1,184,964
200,000
3,911,120
________
1,184,964
-
3,911,120
________
-
-
-
_______
200,000
-
_______
5,777,316
________
5,777,316
________
5,577,316
________
-
_______
200,000
_______
Interest rate risk
The Group finances its business through a mixture of bank overdrafts and invoice discounting facilities.
During the year the Group utilised these facilities at floating rates of interest.
The Group bank overdraft with HSBC plc incurs interest at the rate of 2.3% over the HSBC’s base rate. The
Group is affected by changes in the UK interest rate.
Details of interest payable under the invoice discounting agreement are stated in Note 15.
The US Dollar overdraft facility bears the interest rate of 2.3% over the HSBC’s US dollar base rate and is
therefore affected by changes in the US interest rate.
The fair value of the Group’s financial instruments is not materially different to the book value.
In terms of sensitivity, if the HSBC base rate had been 1% higher throughout the year the level of interest
payable would have been £19,117 (2011: £14,030) higher and if 1% lower throughout the year the level of
interest payable would have been lower by the same amount.
37
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
19.
FINANCIAL INSTRUMENTS (continued)
Foreign currency risk
The Group’s main foreign currency risk is the short term risk associated with accounts receivable and payable
denominated in currencies that are not the subsidiaries functional currency. The risk arises on the difference in
the exchange rate between the time invoices are raised/received and the time invoices are settled/paid. For
sales denominated in foreign currencies the Group will try to ensure that the purchases associated with the sale
will be in the same currency.
All monetary assets and liabilities of the Group were denominated in sterling with the exception of the
following items which were denominated in US dollars, and which are included in the financial statements at
the sterling value based on the exchange rate ruling at the statement of financial position date.
The following table shows the net liabilities exposed to exchange rate risk that the Group has at 31st March
2012:
selbaviecer edarT
stnelaviuqe hsac dna hsaC
selbayap edarT
2012
£
2011
£
952,394,1
036,8
)591,228,1(
________
001,119
395,51
)329,991,1(
________
)603,023(
________
)032,372(
_______
There were also net liabilities of £7,660 in euros (2011: £7,422).
The Group is exposed to currency risk because it undertakes trading transactions in US dollars and euros. The
Directors do not generally consider it necessary to enter into derivative financial instruments to manage the
exchange risk arising from its operations, but from time to time when the Directors consider foreign currencies
are weak and it is known that there will be a requirement to purchase those currencies, forward arrangements
are entered into. Details of those outstanding at the statement of financial position date are given later in this
note.
The effect of a strengthening of 10% in the rate of exchange in the currencies against sterling at the statement
of financial position date would have resulted in an estimated net decrease in pre-tax profit for the year and a
decrease in net assets of approximately £32,000 (2011: £21,300) and the effect of a weakening of 10% in the
rate of exchange in the currencies against sterling at the statement of financial position date would have
resulted in an estimated net increase in pre-tax profit for the year and an increase in net assets of approximately
£32,000 (2011: £21,300).
38
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
19.
FINANCIAL INSTRUMENTS (continued)
Foreign currency risk (continued)
At 31st March 2011 the Group had entered into agreement with its bankers to purchase US dollars as follows:
1st April 2011
1st April 2011
1st April 2011
1102 yaM ts1
1st June 2011
2nd June 2011
$
200,000
100,000
200,000
000,05
150,000
150,000
Rate
1.5985
1.6223
1.6350
9995.1
1.6240
1.6150
At 31st March 2012 the Group had entered into agreement with its bankers to purchase US dollars as follows:
2nd April 2012
1st May 2012
1st May 2012
1st June 2012
$
500,000
1,300,000
500,000
500,000
Rate
1.5601
1.579
1.5928
1.5926
Applying the actual exchange rate at the statement of financial position date to these agreements gives rise to a
liability of £19,521 at 31st March 2012 (2011: an asset of £3,128). In view of the immaterial nature of the
prior year amount, no adjustment was made in the financial statements, but a full provision for the current year
liability has been made in the financial statements.
Capital under management
The Group considers its capital to comprise its ordinary share capital, share premium account, capital
redemption reserve, foreign exchange reserve and accumulated retained earnings.
In managing its capital, the Group’s primary objective is to maximise returns for its equity shareholders. The
Group seeks to maintain a gearing ratio that balances risks and returns at an acceptable level and also to
maintain sufficient funding to enable the Group to meet its working capital and strategic investment need. In
making decisions to adjust its capital structure to achieve these aims the Group considers not only its short
term position but also its long term operational and strategic objectives.
The Group’s gearing ratio at 31st March 2012 is shown below:
stnelaviuqe hsac dna hsaC
stfardrevo knaB
ecnavda gnitnuocsid eciovnI
snaol mret muideM
snaol mret trohS
latipac erahS
tnuocca muimerp erahS
sgninrae deniateR
evreser noitpmeder latipaC
evreser egnahcxe ngieroF
2012
£
)868,14(
599,763,1
714,460,1
-
000,003
________
445,026,2
________
275,933
432,529
873,037,3
476,4
-
________
858,999,4
________
2011
£
)300,37(
232,184
469,481,1
000,002
-
________
391,397,1
________
628,703
089,657
882,908,2
476,4
438,95
________
206,839,3
________
oitar gniraeG
45.0
64.0
39
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
20. DEFERRED TAX
1102 lirpA
secnawolla latipac detareleccA
At 1st
yraidisbus fo noitisiuqcA
raey eht rof egrahC
egnahc etar xat fo tceffE
At 31st
2102 hcraM
Deferred tax rates are at 24% (2011: 26%) being the rate substantially enacted.
21. SHARE CAPITAL
diap ylluf dna deussi dettollA
6,791,431 (2011: 6,156,511) ordinary shares of 5p each
2012
£
899,66
-
886,52
)388,4(
______
308,78
______
2011
£
420,01
315,63
006,52
)931,5(
_____
899,66
_____
2012
£
2011
£
339,572
_______
307,826
_______
On 13th April 2011, a further 634,920 shares were been issued at 31.5p as a result of the exercise by
G S Marsh and J M Lavery of share options.
An Enterprise Management Incentive Scheme was adopted by the Company in September 2000 and formally
approved at an Extraordinary General Meeting on 12th December 2000.
Details of options granted are set out in Note 5. At 31st March 2012 the number of shares covered by option
agreements amounted to 389,291 (2011: 694,920).
22. RESERVES
Full details of movements in reserves are set out in the consolidated statement of changes in equity on page 14.
The following describes the nature and purpose of each reserve within owners’ equity.
evreseR
esopruP dna noitpircseD
Share premium
Capital redemption
Foreign exchange
Retained earnings
Amount subscribed for share capital in excess of nominal value.
Amounts transferred from share capital on redemption of issued shares.
Gains/losses from the retranslation of net assets of overseas operations
into sterling
Cumulative net gains and losses recognised in the consolidated income
statement.
23. LEASING COMMITMENTS
The future aggregate minimum lease payments under non-cancellable operating leases are as follows:
raey 1 naht retal oN
sraey 5 naht retal on dna raey 1 naht retaL
sraey 5 naht retaL
40
2012
£
463,551
178,305
005,244
______
2011
£
144,161
729,635
005,765
______
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
24. SHARE BASED PAYMENT
The Group operates an approved Enterprise Management Incentive Scheme whereby Mr G S Marsh, Mr J M
Lavery and Mr J L Macmichael have been granted options to purchase shares in Solid State PLC at a
subscription price which was not less than the market value at the time the option was granted. The options in
place at 31st March 2012 all have an exercise period of any time after one year from the date of the grant
subject to certain criteria having been met. Full details are set out in Note 5 on pages 25 and 26.
On 13th April 2011, options over 634,920 shares were exercised by Mr G S Marsh and Mr J M Lavery. Details
of the current options and further options granted since the statement of financial position date are stated in
Note 5.
The share-based remuneration expenses amounted to £92,023 for the year (2011: £16,188).
The following information is relevant to the determination of the fair value of the options.
Equity settled share based payments
Option pricing model used
etad tnarg ta ecirp erahS
ecirp esicrexE
noitaived dradnatS
etar tseretni eerf ksiR
Black Scholes
Black Scholes
Black Scholes
p0.26
p0.26
%15
%78.1
p0.49
p0.49
%35
%61.2
p5.99
p5.99
%05
%61.2
The standard deviation is based on the statistical analysis of daily share prices over the twelve months prior to
the date of the grant.
The market vesting conditions have been factored into the calculation by applying an appropriate discount to
the fair value of equivalent share options without the specified vesting conditions.
41
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
25.
SEGMENT INFORMATION
The Group’s primary reporting format for segment information is business segments which reflect the
management reporting structure in the Group. The distribution division includes Solid State Supplies Limited
and the manufacturing division includes Steatite Blazepoint Limited and Steatite Limited which incorporates
RZ Pressure and Wordsworth Technology Limited.
Year ended 31st March 2012
euneveR
lanretxE
ynapmocretnI
Profit/(loss) before tax
Balance sheet
stessA
seitilibaiL
Distribution
noisivid
£
Manufacturing
noisivid
£
Head
eciffo
£
latoT
£
011,934,6
-
________
011,934,6
________
493,518
________
140,534,91
269,04
________
-
-
________
151,478,52
269,04
_________
300,674,91
________
-
________
311,519,52
_________
1,709,874
________
(604,248)
________
1,599,144
________
511,956,2
)084,180,3(
_________
851,965,01
(4,416,212)
________
920,52
649,443
_______
203,352,31
(8,147,135)
________
Net assets/(liabilities)
(422,365)
_________
6,152,946
________
(624,414)
_______
5,106,167
________
Other
erutidnepxe latipaC
- Tangible fixed assets
stessa dexif elbignatnI -
Depreciation, amortisation and
other non cash expenses
diap tseretnI
159,664
-
57,119
607,71
________
319,123
411,58
147,843
222,62
________
-
-
34,064
086,32
________
478,787
411,58
239,026
806,76
________
42
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
25.
SEGMENT INFORMATION (continued)
Year ended 31st March 2011
euneveR
lanretxE
ynapmocretnI
Profit/(loss) before tax
Balance sheet
stessA
seitilibaiL
Distribution
noisivid
£
Manufacturing
noisivid
£
Head
eciffo
£
latoT
£
096,966,4
-
________
096,966,4
________
244,745
________
816,994,61
006,732
________
-
-
________
803,961,12
006,732
_________
812,737,61
________
-
________
809,604,12
_________
1,495,172
________
(496,421)
________
1,243,496
________
009,084,2
)120,431,3(
________
248,065,7
(2,836,133)
________
-
(132,986)
_______
247,140,01
(6,103,140)
________
Net assets/(liabilities)
(653,121)
________
4,724,709
_________
(132,986)
_______
3,938,602
________
Other
erutidnepxe latipaC
- Tangible fixed assets
stessa dexif elbignatnI -
Depreciation, amortisation and
other non cash expenses
diap tseretnI
172,870
-
54,666
190,23
________
318,522
257,763
74,428
950,12
________
-
-
-
-
________
491,392
257,763
129,094
051,35
________
yb eunever lanretxE
remotsuc fo noitacol
2011
£
2012
£
ts by
essa latoT
stessa fo noitacol
2011
2012
£
£
24,352,381 19,892,533 13,253,302 10,029,908
-
11,834
-
-
-
-
-
_________ _________ _________ _________
172,762
1,069,359
95,497
143,803
30,000
10,089
260
154,736
846,851
89,929
164,049
16,000
4,646
564
-
-
-
-
-
-
-
Net tangible capital
expenditure by location
stessa fo
2012
£
478,787
-
-
-
-
-
-
-
_______
2011
£
491,392
-
-
-
-
-
-
-
_______
United Kingdom
Ireland
Europe
North America
Asia
Africa
Australasia
South America
247,140,01 203,352,31 803,961,12 151,478,52
_________ _________ _________ _________
787,874
_______
293,194
_______
All the above relate to continuing operations.
43
Solid State PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31st March 2011 (continued)
26. ACQUISITION DURING THE YEAR
On 14th October 2011 the Group acquired the business and certain assets of Blazepoint Limited for a cash
consideration of £200,000. The trade has been operated by Steatite Blazepoint Limited, a newly formed 100%
subsidiary of Solid State PLC, and comprises the distribution, manufacture and maintenance of computer
products.
Analysis of the acquisition of the business and certain assets of Blazepoint Limited.
erawtfos retupmoc :stessa dexif elbignatnI
stessa dexif elbignaT
kcotS
srotiderC
noitisiuqca no stessa teN
noitisiuqca no niaG
noitaredisnoC
Discharged by:
hsaC
eulav riaF
puorG ot
£
000,77
000,091
000,002
)317,601(
_______
782,063
)782,061(
_______
000,002
_______
000,002
_______
In addition to the purchase price, the Group incurred costs relating to the acquisition of £10,000. These are
included in administrative expenses.
The revenue included in the Consolidated Statement of Comprehensive Income arising from Steatite
Blazepoint Limited was £527,969 and the loss before taxation was £61,686.
The gain on acquisition is included separately in the statement of comprehensive income.
44
Solid State PLC
Company Number: 00771335
COMPANY BALANCE SHEET
at 31st March 2012
STESSA DEXIF
stnemtsevnI
STESSA TNERRUC
srotbeD
dnah ni dna knab ta hsaC
CREDITORS: Amounts falling due within
raey eno
NET CURRENT (LIABILITIES)/ASSETS
STESSA TEN
SEVRESER DNA LATIPAC
latipac erahs pu dellaC
tnuocca muimerp erahS
evreser noitpmeder latipaC
tnuocca ssol dna tiforP
SDNUF ’SREDLOHERAHS
setoN
2102
1102
£
£
£
£
4
5
353,617,2
_________
264,037,2
________
353,617,2
264,037,2
940,761,1
-
________
217,424,1
-
________
940,761,1
217,424,1
6
417,172,1
________
430,119
________
(104,665)
________
886,116,2
________
275,933
432,529
476,4
802,243,1
________
886,116,2
________
513,678
________
041,442,3
________
628,703
089,657
476,4
066,471,2
________
041,442,3
________
7
8
8
8
The financial statements were approved by the Board of Directors and authorised for issue on 20th June 2012.
P Haining
Director
G S Marsh
Director
The notes on pages 46 to 49 form part of these financial statements.
45
Solid State PLC
NOTES TO THE COMPANY FINANCIAL STATEMENTS
For the year ended 31st March 2012
1.
ACCOUNTING POLICIES
The following accounting policies have been applied consistently in dealing with items which are considered
material in relation to the Company’s financial statements.
Basis of preparation
The financial statements have been prepared in accordance with applicable UK accounting standards and under
the historical cost convention. The accounts have been prepared on the going concern basis.
Profit and loss account
Under section 408(4) of the Companies Act 2006 the Company is exempt from the requirement to present its
own profit and loss account. The loss for the year ended 31st March 2012 is disclosed in Note 8.
Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling at closing rates of exchange.
Investments in subsidiaries
Investments in subsidiaries are stated at cost less amounts provided for impairment.
Other financial liabilities
Other financial liabilities include the following items:
(cid:129)(cid:129)(cid:129) Amounts owed by group undertakings and other creditors, which are recognised at amortised cost.
(cid:129)(cid:129) Bank borrowings are initially recognised at the amount advanced net of any transaction costs directly
attributable to the issue of the instrument. Such interest bearing liabilities are subsequently measured at
amortised cost using the effective interest rate method which ensures that any interest expense over the
period to repayment is at a constant rate on the balance of the liabilities carried in the balance sheet.
Interest expense in this context includes initial transaction costs and premium payable on redemption, as
well as any interest or coupon payable while the liability is outstanding.
Shared based payment
Where share options are awarded to employees, the fair value of the options at the date of grant is charged to
the profit and loss account over the vesting period. Non-market vesting conditions are taken into account by
adjusting the number of equity instruments expected to vest at each balance sheet date so that, ultimately, the
cumulative amount recognised over the vesting period is based on the number of options that eventually vest.
Market vesting conditions are factored into the fair value of options granted. As long as all other vesting
conditions are satisfied, a change is made irrespective of whether the market vesting conditions are satisfied.
The cumulative expense is not adjusted for factors to achieve a market vesting condition.
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the
options, measured immediately before and after the modification, is also charged to the profit and loss account
over the remaining vesting period.
2.
STAFF COSTS
Staff costs amounted £471,235 (2011: £16,188) and comprised the share based payment expense of £92,023
and salary and related costs in respect of Mr G L Comben, Mr W G Marsh, Mr A B Frere, Mr G S Marsh and
Mr P Haining. No other remuneration was paid by the Company. Details of directors’ emoluments are given in
note 5 to the Group financial statements.
46
Solid State PLC
NOTES TO THE COMPANY FINANCIAL STATEMENTS
For the year ended 31st March 2012
3.
SHARE BASED PAYMENT
The Group operates an approved Enterprise Management Incentive Scheme whereby Mr G S Marsh, Mr J M
Lavery and Mr J L Macmichael have been granted options to purchase shares in Solid State PLC at a
subscription price which was not less than the market value at the time the option was granted. The options in
place at 31st March 2012 all have an exercise period of any time after one year from the date of the grant
subject to certain criteria having been met. Full details are set out in Note 5 on pages 25 and 26.
On 11th April 2011, options of 634,920 shares were exercised by Mr G S Marsh and Mr J M Lavery. Details
of the current options and further options granted since the statement of financial position date are stated in
Note 5.
The share-based remuneration expenses amounted to £92,023 for the year (2011: £16,188).
The following information is relevant to the determination of the fair value of the options.
Equity settled share based payments
Option pricing model used
etad tnarg ta ecirp erahS
ecirp esicrexE
noitaived dradnatS
etar tseretni eerf ksiR
Black Scholes
Black Scholes
Black Scholes
p0.26
p0.26
%15
%78.1
p0.49
p0.49
%35
%61.2
p5.99
p5.99
%05
%61.2
The standard deviation is based on the statistical analysis of daily share prices over the twelve months prior to
the date of the grant.
The market vesting conditions have been factored into the calculation by applying an appropriate discount to
the fair value of equivalent share options without the specified vesting conditions.
47
Solid State PLC
4.
INVESTMENTS
Company
NOTES TO THE COMPANY FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Cost
1st April 2011
Addition
Disposal
2102 hcraM ts13
Net book value
2102 hcraM ts13
1102 hcraM ts13
Subsidiary undertakings
Group
undertakings
£
2,730,462
1,000
(15,109)
________
353,617,2
________
353,617,2
________
264,037,2
________
The principal undertakings in which the Company’s interest at the year end is 20% or more are as follows:
sgnikatrednu yraidisbuS
detimiL seilppuS etatS diloS
detimiL etitaetS
Steatite Blazepoint Limited
gnitov fo noitroporP
rights and Ordinary
share capital held
Nature of business
%001
%001
100%
stnenopmoc cinortcele fo noitubirtsiD
dna stnenopmoc cinortcele fo noitubirtsiD
manufacture of electronic equipment
Distribution, manufacture and maintenance of
computer products.
In all cases the country of operation and of incorporation or registration is England.
5.
DEBTORS
sgnikatrednu puorG yb dewo stnuomA
srotbed rehtO
stnemyaperP
6.
CREDITORS: Amounts falling due within one year
)deruces( tfardrevo knaB
sgnikatrednu puorG ot dewo stnuomA
srotiderc rehtO
slaurccA
48
2012
£
2011
£
020,241,1
944,42
085
_________
217,424,1
-
-
_________
940,761,1
_________
217,424,1
________
657,913
463,833
946,323
549,982
_________
417,172,1
_________
200,61
314,298
916,2
-
_______
430,119
_______
NOTES TO THE COMPANY FINANCIAL STATEMENTS
For the year ended 31st March 2012 (continued)
Solid State PLC
6.
CREDITORS: Amounts falling due within one year (continued)
The Company has guaranteed bank borrowings of its subsidiary undertakings, Solid State Supplies Limited,
Steatite Limited and Steatite Blazepoint Limited. At the year end the liabilities covered by those guarantees
amounted to £1,048,239 (2011: £465,230). The Company accounts for guarantees provided to Group
companies as insurance contracts, recognising a liability only to the extent that it is probable the guarantees
will be called upon.
7.
SHARE CAPITAL
Allotted issued and fully paid
6,791,431 (2011: 6,156,511) ordinary shares of 5p each
2012
2011
£ £
339,572
_______
307,826
_______
On 13th April 2011, a further 634,920 shares were been issued at 31.5p as a result of the exercise by
G S Marsh and J M Lavery of share options.
An Enterprise Management Incentive Scheme was adopted by the Company in September 2000 and formally
approved at an Extraordinary General Meeting on 12th December 2000.
Details of options granted are set out in Note 5. At 31st March 2012 the number of shares covered by option
agreements amounted to 389,291 (2011: 694,920).
8. RESERVES
1102 lirpA ts1
serahs fo eussI
raey eht rof )ssoL(
esnepxe desab erahS :ddA
diap dnediviD
2102 hcraM ts13
Share premium Capital redemption Profit & loss
ser
account
tnuocca
erve
089,657
452,861
-
_______
432,529
-
_______
432,529
-
________
432,529
________
476,4
-
-
_____
476,4
-
_____
476,4
-
_____
476,4
_____
066,471,2
-
)758,785(
_______
308,685,1
320,29
_______
628,876,1
)344,144(
_______
383,732,1
_______
The cumulative amount of goodwill which has been eliminated against reserves at 31st March 2012 is £30,000
(2011: £30,000).
49
Solid State PLC
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the annual general meeting of Solid State PLC will be held at 2, Ravensbank Business Park,
Hedera Road Redditch B98 9EY, on 8th August 2012 at 11.00am for the following purposes:
(1)
(2)
(3)
(4)
(5)
(6)
(7)
ORDINARY RESOLUTIONS
To receive and adopt the accounts for the year ended 31st March 2012, together with the reports of the
Directors and auditors thereon. (Resolution 1)
To declare a final dividend of 4.75p per share. (Resolution 2)
To reappoint Gordon Leonard Comben, who retires by rotation, as a Director of the Company in accordance
with the Company’s Articles of Association. (Resolution 3)
To reappoint Anthony Brian Frere, who retires by rotation, as a Director of the Company in accordance with
the Company’s Articles of Association. (Resolution 4)
To reappoint haysmacintyre as auditors of the Company. (Resolution 5)
To authorise the Directors to fix the auditors’ remuneration, (Resolution 6)
To pass the following resolution:
That the Directors be generally and unconditionally authorised to allot shares in the Company (Relevant
Securities):
i)
comprising equity securities (as defined by section 560 of the Companies Act 2006) up to an
aggregate nominal amount of £113,190.50 (which is 33% of the issued share capital) (such amount
to be reduced by the nominal amount of any Relevant Securities allotted under paragraph (ii) below)
in connection with an offer by way of a rights issue:
ii)
(a) to holders of ordinary shares in proportion (as nearly as may be practicable) to their
respective holdings; and
(b) to holders of other equity securities as required by the rights of those securities or as the
Directors otherwise consider necessary,
but subject to such exclusions or other arrangements as the Board may deem necessary or expedient
in relation to treasury shares, fractional entitlements, record dates, legal or practical problems in or
under the laws of any territory or the requirements of any regulatory body or stock exchange; and
in any other case, up to an aggregate nominal amount of £67,914.30 (which is 20% of the issued
share capital) (such amount to be reduced by the nominal amount of any equity securities allotted
under paragraph i) above,
provided that this authority shall, unless renewed, varied or revoked by the Company, expire after a
period of 18 months from the passing of this resolution or, if earlier, the date of the next annual
general meeting of the Company save that the Company may, before such expiry, make offers or
agreements which would or might require Relevant Securities to be allotted and the Directors may
allot Relevant Securities in pursuance of such offer or agreement notwithstanding that the authority
conferred by this resolution has expired.
This resolution revokes and replaces all unexercised authorities previously granted to the Directors to allot
Relevant Securities but without prejudice to any allotment of shares or grant of rights already made, offered
or agreed to be made pursuant to such authorities. (Resolution 7)
SPECIAL RESOLUTIONS
(8)
To pass the following resolution:
That the Company is authorised to allot equity securities pursuant to resolution 7 above up to an aggregate
nominal amount of £67,914.30, which is 20% of the issued share capital, as if Section 561 of the Companies
Act 2006 (existing shareholders – right of pre-emption):
i)
ii)
did not apply to the allotment; or
applied to the allotment with such modifications as the Directors may determine provided that this
authority shall, unless renewed, varied or revoked by the company, expire after a period of 18 months
from the passing of this resolution save that the company may, before such expiry, make offers or
agreements which would or might require equity securities to be allotted and the Directors may allot
equity securities in pursuance of such offer or agreement not withstanding that the authority conferred
by the resolution ahs expired. (Resolution 8)
50
NOTICE OF ANNUAL GENERAL MEETING (continued)
SPECIAL RESOLUTIONS (continued)
Solid State PLC
(9)
i)
ii)
To pass the following resolution:
That the Company is, pursuant to Section 701 of the Companies Act 2006, hereby generally and
unconditionally authorised to make market purchases (within the meaning of Section 693 of the Companies
Act 2006) of ordinary shares of 5p each in the capital of the Company (“ordinary shares”) provided that:-
the minimum price which may be paid for the ordinary shares is 5p per ordinary share;
the maximum price that may be paid for such shares is, in respect of a share contracted to be
purchased on any day , an amount (exclusive of all expenses) equal to 105 per cent of the average
middle market quotations of the ordinary shares of the company as derived from the Daily Official
List of the London Stock Exchange on the 10 dealing days immediately preceding the day on which
the shares are contracted to be purchased;
the authority hereby conferred shall expire after a period of 18 months from the passing of this
resolution unless such authority is renewed prior to such expiry;
the authority hereby conferred is in substitution for any existing authority to purchase ordinary shares
under the said Section 701;
the Company may make a contract to purchase ordinary shares under the authority hereby conferred
prior to the expiry of such authority which will be executed wholly or partly after the expiry of such
authority and may make a purchase or purchases of ordinary shares in pursuance of any such contract;
and
the maximum number of ordinary shares hereby authorised to be purchased by the Company does not
exceed 15 per cent of the issued ordinary share capital of the Company at the date of the passing of
this resolution. (Resolution 9)
iii)
iv)
vi)
v)
BY ORDER OF THE BOARD
P Haining FCA
Director
20th June 2012
Registered office:
Unit 2, Eastlands Lane, Paddock Wood, Kent, TN12 6BU
NOTES:
1.
2.
Proxies
Only holders of ordinary shares are entitled to attend and vote at this meeting. A member entitled to attend and
vote may appoint a proxy or proxies who need not be a member of the Company to attend and to vote instead of
him or her. Forms of proxy need to be deposited with the Company’s registrar, Capita Group plc, Balfour
House, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU, not later than 48 hours before the time
of the meeting. Completion of a form of proxy will not preclude a member attending and voting in person at the
meeting.
Documents on Display
The register of Directors’ interests in the share capital and debentures of the Company, together with copies of
service agreements under which Directors of the Company are employed, are available for inspection at the
Company’s registered office during normal business hours from the date of this notice until the date of the
Annual General Meeting and will also be available for inspection at the place of the Annual General Meeting for
at least 15 minutes prior to the meeting.
51
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